HSI ASSET SECURITIZATION CORPORATION, Depositor, WELLS FARGO BANK, N.A., Originator, Servicer, Master Servicer, Securities Administrator and Custodian, DEUTSCHE BANK NATIONAL TRUST COMPANY, Trustee and OFFICETIGER GLOBAL REAL ESTATE SERVICES INC.,...
EXECUTION
HSI
ASSET
SECURITIZATION CORPORATION,
Depositor,
▇▇▇▇▇
FARGO BANK, N.A.,
Originator,
Servicer, Master Servicer, Securities Administrator and Custodian,
DEUTSCHE
BANK NATIONAL TRUST COMPANY,
Trustee
and
OFFICETIGER
GLOBAL REAL ESTATE SERVICES INC.,
Credit
Risk Manager
Dated
as
of June 1, 2007
HSI
ASSET
SECURITIZATION CORPORATION TRUST 2007-WF1
MORTGAGE
PASS-THROUGH CERTIFICATES,
SERIES 2007-WF1
TABLE
OF
CONTENTS
Page
|
ARTICLE
I
|
||
|
DEFINITIONS
|
||
|
ARTICLE
II
|
||
|
CONVEYANCE
OF MORTGAGE LOANS;
|
||
|
REPRESENTATIONS
AND WARRANTIES
|
||
|
Section
2.01
|
Conveyance
of Mortgage Loans
|
43
|
|
Section
2.02
|
Acceptance
by the Custodian of the Mortgage Loans
|
47
|
|
Section
2.03
|
Representations,
Warranties and Covenants of the Originator and the Servicer; Remedies
for
Breaches of Representations and Warranties with Respect to the
Mortgage
Loans
|
48
|
|
Section
2.04
|
Execution
and Delivery of Certificates
|
52
|
|
Section
2.05
|
REMIC
Matters
|
52
|
|
Section
2.06
|
Representations
and Warranties of the Depositor
|
52
|
|
ARTICLE
III
|
||
|
ADMINISTRATION
AND SERVICING
|
||
|
OF
MORTGAGE LOANS
|
||
|
Section
3.01
|
Servicer
to Service Mortgage Loans
|
53
|
|
Section
3.02
|
Subservicing
Agreements between Servicer and Subservicers; Use of
Subcontractors
|
55
|
|
Section
3.03
|
Successor
Subservicers
|
57
|
|
Section
3.04
|
Liability
of the Servicer
|
57
|
|
Section
3.05
|
No
Contractual Relationship between Subservicers and the Master
Servicer
|
57
|
|
Section
3.06
|
Assumption
or Termination of Subservicing Agreements by Master
Servicer
|
58
|
|
Section
3.07
|
Collection
of Certain Mortgage Loan Payments
|
58
|
|
Section
3.08
|
Subservicing
Accounts
|
61
|
|
Section
3.09
|
Collection
of Taxes, Assessments and Similar Items; Escrow Accounts
|
61
|
|
Section
3.10
|
Collection
Account
|
62
|
|
Section
3.11
|
Withdrawals
from the Collection Account
|
63
|
|
Section
3.12
|
Investment
of Funds in the Collection Account, Escrow Accounts and the Distribution
Account
|
64
|
|
Section
3.13
|
Maintenance
of Hazard Insurance and Errors and Omissions and Fidelity
Coverage
|
66
|
|
Section
3.14
|
Enforcement
of Due-On-Sale Clauses; Assumption Agreements
|
67
|
|
Section
3.15
|
Realization
upon Defaulted Mortgage Loans
|
68
|
|
Section
3.16
|
Release
of Mortgage Files
|
70
|
|
Section
3.17
|
Title,
Conservation and Disposition of REO Property
|
71
|
|
Section
3.18
|
Notification
of Adjustments
|
72
|
|
Section
3.19
|
Access
to Certain Documentation and Information Regarding the Mortgage
Loans
|
72
|
|
Section
3.20
|
Documents,
Records and Funds in Possession of the Servicer to Be Held for
the
Trustee
|
73
|
|
Section
3.21
|
Servicing
Compensation
|
73
|
|
Section
3.22
|
Report
on Assessment of Compliance with Relevant Servicing
Criteria.
|
74
|
|
Section
3.23
|
Report
on Attestation of Compliance with Relevant Servicing
Criteria.
|
75
|
|
Section
3.24
|
Annual
Officer’s Certificates.
|
75
|
|
Section
3.25
|
Master
Servicer to Act as Servicer
|
77
|
|
Section
3.26
|
Compensating
Interest
|
78
|
|
Section
3.27
|
Credit
Reporting; ▇▇▇▇▇-▇▇▇▇▇-▇▇▇▇▇▇ Act
|
78
|
|
Section
3.28
|
[Reserved]
|
78
|
|
Section
3.29
|
Notifications
to Parties.
|
78
|
|
Section
3.30
|
Indemnification.
|
79
|
|
ARTICLE
IV
|
||
|
DISTRIBUTIONS
AND
|
||
|
ADVANCES
BY THE SERVICER
|
||
|
Section
4.01
|
Advances
|
80
|
|
Section
4.02
|
Priorities
of Distribution
|
81
|
|
Section
4.03
|
Monthly
Statements to Certificateholders
|
87
|
|
Section
4.04
|
Certain
Matters Relating to the Determination of LIBOR
|
89
|
|
Section
4.05
|
Allocation
of Applied Realized Loss Amounts
|
90
|
|
Section
4.06
|
Supplemental
Interest Trust.
|
90
|
|
Section
4.07
|
Rights
of the Swap Counterparty.
|
93
|
|
Section
4.08
|
Termination
Receipts.
|
93
|
|
ARTICLE
V
|
||
|
THE
CERTIFICATES
|
||
|
Section
5.01
|
The
Certificates
|
94
|
|
Section
5.02
|
Certificate
Register; Registration of Transfer and Exchange of
Certificates
|
95
|
|
Section
5.03
|
Mutilated,
Destroyed, Lost or Stolen Certificates
|
101
|
|
Section
5.04
|
Persons
Deemed Owners
|
102
|
|
Section
5.05
|
Access
to List of Certificateholders’ Names and Addresses
|
102
|
-ii-
|
Section
5.06
|
Maintenance
of Office or Agency
|
102
|
|
ARTICLE
VI
|
||
|
THE
DEPOSITOR AND THE SERVICER
|
||
|
Section
6.01
|
Respective
Liabilities of the Depositor and the Servicer
|
102
|
|
Section
6.02
|
Merger
or Consolidation of the Depositor or the Servicer
|
103
|
|
Section
6.03
|
Limitation
on Liability of the Depositor, the Servicer and Others.
|
103
|
|
Section
6.04
|
Limitation
on Resignation of the Servicer.
|
104
|
|
Section
6.05
|
Additional
Indemnification by the Servicer; Third Party Claims.
|
104
|
|
Section
6.06
|
Compliance
with Regulation AB; Cooperation of Parties
|
105
|
|
ARTICLE
VII
|
||
|
DEFAULT
|
||
|
Section
7.01
|
Events
of Default
|
105
|
|
Section
7.02
|
Master
Servicer to Act; Appointment of Successor
|
108
|
|
Section
7.03
|
Notification
to Certificateholders
|
110
|
|
ARTICLE
VIII
|
||
|
CONCERNING
THE TRUSTEE
|
||
|
Section
8.01
|
Duties
of the Trustee
|
110
|
|
Section
8.02
|
Certain
Matters Affecting the Trustee
|
111
|
|
Section
8.03
|
Trustee
Not Liable for Certificates or Mortgage Loans
|
112
|
|
Section
8.04
|
Trustee
May Own Certificates
|
113
|
|
Section
8.05
|
Trustee’s
Fees Indemnification and Expenses
|
113
|
|
Section
8.06
|
Eligibility
Requirements for the Trustee
|
114
|
|
Section
8.07
|
Resignation
and Removal of the Trustee
|
114
|
|
Section
8.08
|
Successor
Trustee
|
115
|
|
Section
8.09
|
Merger
or Consolidation of the Trustee
|
116
|
|
Section
8.10
|
Appointment
of Co-Trustee or Separate Trustee
|
116
|
|
Section
8.11
|
Tax
Matters
|
117
|
|
Section
8.12
|
Commission
Reporting
|
121
|
|
Section
8.13
|
Tax
Classification of the Excess Reserve Fund Account and the Supplemental
Interest Trust
|
128
|
|
ARTICLE
IX
|
||
|
ADMINISTRATION
OF THE MORTGAGE LOANS
|
||
|
BY
THE MASTER SERVICER AND THE CREDIT RISK MANAGER
|
||
|
Section
9.01
|
Duties
of the Master Servicer; Enforcement of Servicer’s
Obligations.
|
128
|
-iii-
|
Section
9.02
|
[Reserved]
|
130
|
|
Section
9.03
|
[Reserved]
|
130
|
|
Section
9.04
|
Maintenance
of Fidelity Bond and Errors and Omissions Insurance.
|
130
|
|
Section
9.05
|
Representations
and Warranties of the Master Servicer
|
130
|
|
Section
9.06
|
Master
Servicer Events of Default
|
131
|
|
Section
9.07
|
Waiver
of Default.
|
133
|
|
Section
9.08
|
Successor
to the Master Servicer.
|
133
|
|
Section
9.09
|
Compensation
of the Master Servicer.
|
134
|
|
Section
9.10
|
Merger
or Consolidation.
|
134
|
|
Section
9.11
|
Resignation
of the Master Servicer.
|
135
|
|
Section
9.12
|
Assignment
or Delegation of Duties by the Master Servicer.
|
135
|
|
Section
9.13
|
Limitation
on Liability of the Master Servicer.
|
135
|
|
Section
9.14
|
Indemnification;
Third Party Claims.
|
136
|
|
Section
9.15
|
Duties
of the Credit Risk Manager.
|
136
|
|
Section
9.16
|
Limitation
Upon Liability of the Credit Risk Manager.
|
137
|
|
Section
9.17
|
Removal
and Resignation of Credit Risk Manager.
|
138
|
|
ARTICLE
X
|
||
|
CONCERNING
THE SECURITIES ADMINISTRATOR
|
||
|
Section
10.01
|
Duties
of Securities Administrator.
|
138
|
|
Section
10.02
|
Certain
Matters Affecting the Securities Administrator.
|
139
|
|
Section
10.03
|
Securities
Administrator Not Liable for Certificates or Mortgage
Loans.
|
141
|
|
Section
10.04
|
Securities
Administrator May Own Certificates.
|
141
|
|
Section
10.05
|
Securities
Administrator’s Fees and Expenses.
|
142
|
|
Section
10.06
|
Eligibility
Requirements for Securities Administrator.
|
142
|
|
Section
10.07
|
Resignation
and Removal of Securities Administrator.
|
143
|
|
Section
10.08
|
Successor
Securities Administrator.
|
144
|
|
Section
10.09
|
Merger
or Consolidation of Securities Administrator.
|
144
|
|
Section
10.10
|
Assignment
or Delegation of Duties by the Securities Administrator.
|
145
|
|
ARTICLE
XI
|
||
|
TERMINATION
|
||
|
Section
11.01
|
Termination
upon Liquidation or Purchase of the Mortgage Loans
|
145
|
|
Section
11.02
|
Final
Distribution on the Certificates
|
146
|
|
Section
11.03
|
Additional
Termination Requirements
|
147
|
|
ARTICLE
XII
|
||
|
MISCELLANEOUS
PROVISIONS
|
||
|
Section
12.01
|
Amendment
|
148
|
|
Section
12.02
|
Recordation
of Agreement; Counterparts
|
150
|
-iv-
|
Section
12.03
|
Governing
Law
|
150
|
|
Section
12.04
|
Intention
of Parties
|
150
|
|
Section
12.05
|
Notices
|
152
|
|
Section
12.06
|
Severability
of Provisions
|
153
|
|
Section
12.07
|
Assignment
|
153
|
|
Section
12.08
|
Limitation
on Rights of Certificateholders
|
153
|
|
Section
12.09
|
Inspection
and Audit Rights
|
154
|
|
Section
12.10
|
Certificates
Nonassessable and Fully Paid
|
154
|
|
Section
12.11
|
Rule of
Construction
|
154
|
|
Section
12.12
|
Waiver
of Jury Trial
|
154
|
-v-
|
SCHEDULES
|
|
|
Schedule I
|
Mortgage
Loan Schedule
|
|
EXHIBITS
|
|
|
Exhibit A
|
Form
of Class A and Class M Certificates
|
|
Exhibit B
|
Form
of Class P Certificate
|
|
Exhibit C
|
Form
of Class R Certificate
|
|
Exhibit D
|
Form
of Class X Certificate
|
|
Exhibit E
|
Form
of Initial Certification of Custodian
|
|
Exhibit F
|
Form
of Document Certification and Exception Report of
Custodian
|
|
Exhibit G
|
Form
of Residual Transfer Affidavit
|
|
Exhibit H
|
Form
of Transferor Certificate
|
|
Exhibit I-A
|
Form
of Rule 144A Investment Letter
|
|
Exhibit
I-B
|
Form
of Regulation S Investment Letter
|
|
Exhibit J
|
Form
of Request for Release
|
|
Exhibit K
|
Contents
for Each Mortgage File
|
|
Exhibit L
|
Form
of ▇▇▇▇▇▇▇▇-▇▇▇▇▇ Certification to be Provided by Master Servicer
(or
other Certification Party) signing Form 10-K
|
|
Exhibit M
|
Form
of Back-Up ▇▇▇▇▇▇▇▇-▇▇▇▇▇ Certification
|
|
Exhibit
N-1
|
Standard
File Layout - Master Servicing (Form of Monthly Remittance
Advice)
|
|
Exhibit
N-2
|
Standard
File Layout for Delinquency Reporting
|
|
Exhibit
N-3
|
Form
332 Realized Loss Report
|
|
Exhibit
O
|
Form
of Swap Agreement
|
|
Exhibit
P
|
Form
of Cap Agreement
|
|
Exhibit
Q
|
Seller’s
Warranties and Servicing Agreement
|
|
Exhibit
R
|
[Reserved]
|
-vi-
|
Exhibit
S
|
Servicing
Criteria Matrix
|
|
Exhibit
T
|
Transaction
Parties
|
|
Exhibit
U
|
Form
of Annual Compliance Certificate
|
|
Exhibit
V
|
Additional
Form 10-D Disclosure
|
|
Exhibit
W
|
Additional
Form 10-K Disclosure
|
|
Exhibit
X
|
Form
8-K Disclosure Information
|
|
Exhibit
Y
|
Additional
Disclosure Notification
|
-vii-
THIS
POOLING AND SERVICING AGREEMENT, dated as of June 1, 2007, among HSI ASSET
SECURITIZATION CORPORATION, as depositor (the “Depositor”),
▇▇▇▇▇
FARGO BANK, N.A., a national banking association, as originator (in such
capacity, the “Originator”),
as
servicer (in such capacity, the “Servicer”)
as
master servicer (in such capacity, the “Master
Servicer”)
as
securities administrator (in such capacity, the “Securities
Administrator”)
and as
custodian (in such capacity, the “Custodian”),
OFFICETIGER GLOBAL REAL ESTATE SERVICES INC., as credit risk manager (the
“Credit
Risk Manager”),
and
DEUTSCHE BANK NATIONAL TRUST COMPANY, a national banking association, as trustee
(the “Trustee”).
WITNESSETH:
In
consideration of the mutual agreements herein contained, the parties hereto
agree as follows:
PRELIMINARY
STATEMENT
The
Securities Administrator on behalf of the Trust Fund (exclusive of (i) the
Swap
Agreement, (ii) the Cap Agreement (iii) the right to receive and the obligation
to pay Basis Risk Carryover Amounts, (iv) the Excess Reserve Fund Account,
(v)
the Supplemental Interest Trust and the Supplemental Interest Trust Account
and
(vi) the obligation to pay Class I Shortfalls (collectively, the “Excluded
Trust Assets”)
shall
elect that the segregated asset pool within the Trust Fund be treated for
federal income tax purposes as comprising three real estate mortgage investment
conduits under Section 860D of the Code (each a “REMIC”
or,
in
the alternative, “REMIC
1,”
REMIC
2,”
and
“REMIC 3”; REMIC 3 also being referred to herein as the “Upper
Tier REMIC.”)
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 election.
Each
Certificate, other than the Class R Certificates, represents ownership of a
regular interest in the Upper Tier REMIC for purposes of the REMIC Provisions.
In addition, each Certificate, other than the Class R, Class X and Class P
Certificates, represents (i) the right to receive payments with respect to
any
Basis Risk Carryover Amounts and (ii) the obligation to pay Class I Shortfalls.
The Class R Certificate represents ownership of the sole Class of residual
interest in each of REMIC 1, REMIC 2, and the Upper Tier REMIC for purposes
of
the REMIC Provisions.
The
Upper
Tier REMIC shall hold as its assets the uncertificated Lower Tier Interests
in
REMIC 2, and each such Lower Tier Interest is hereby designated as a regular
interest in REMIC 2. REMIC 2 shall hold as its assets the uncertificated Lower
Tier Interests in REMIC 1, and each such Lower Tier Interest is hereby
designated as a regular interest in REMIC 1. REMIC 1 shall hold as its assets
the property of the Trust Fund other than the Lower Tier Interests in REMIC
1,
and REMIC 2 and the Excluded Trust Assets.
REMIC
1:
The
following table sets forth the designations, principal balances and interest
rates for each interest in REMIC 1, each of which (other than the Class LT1-R
Lower Tier Interest) is hereby designated as a regular interest in REMIC 1
(the
“REMIC 1 Regular Interests”):
|
Class
Designation
|
Initial Principal
Balance
|
Interest
Rate
|
|
LT1-A
|
(5)
|
(1)
|
|
LT1-F1
|
$ 5,929,610.00
|
(2)
|
|
LT1-V1
|
$ 5,929,610.00
|
(3)
|
|
LT1-F2
|
$ 6,908,510.50
|
(2)
|
|
LT1-V2
|
$ 6,908,510.50
|
(3)
|
|
LT1-F3
|
$ 7,866,553.00
|
(2)
|
|
LT1-V3
|
$ 7,866,553.00
|
(3)
|
|
LT1-F4
|
$ 8,789,214.00
|
(2)
|
|
LT1-V4
|
$ 8,789,214.00
|
(3)
|
|
LT1-F5
|
$ 9,669,169.00
|
(2)
|
|
LT1-V5
|
$ 9,669,169.00
|
(3)
|
|
LT1-F6
|
$ 10,485,224.50
|
(2)
|
|
LT1-V6
|
$ 10,485,224.50
|
(3)
|
|
LT1-F7
|
$ 11,185,943.50
|
(2)
|
|
LT1-V7
|
$ 11,185,943.50
|
(3)
|
|
LT1-F8
|
$ 11,592,632.00
|
(2)
|
|
LT1-V8
|
$ 11,592,632.00
|
(3)
|
|
LT1-F9
|
$ 11,053,493.00
|
(2)
|
|
LT1-V9
|
$ 11,053,493.00
|
(3)
|
|
LT1-F10
|
$ 10,532,533.00
|
(2)
|
|
LT1-V10
|
$ 10,532,533.00
|
(3)
|
|
LT1-F11
|
$ 10,036,181.50
|
(2)
|
|
LT1-V11
|
$ 10,036,181.50
|
(3)
|
|
LT1-F12
|
$ 9,563,272.50
|
(2)
|
|
LT1-V12
|
$ 9,563,272.50
|
(3)
|
|
LT1-F13
|
$ 9,113,884.50
|
(2)
|
|
LT1-V13
|
$ 9,113,884.50
|
(3)
|
|
LT1-F14
|
$ 8,712,157.00
|
(2)
|
|
LT1-V14
|
$ 8,712,157.00
|
(3)
|
|
LT1-F15
|
$ 8,320,114.50
|
(2)
|
|
LT1-V15
|
$ 8,320,114.50
|
(3)
|
|
LT1-F16
|
$ 7,978,796.00
|
(2)
|
|
LT1-V16
|
$ 7,978,796.00
|
(3)
|
|
LT1-F17
|
$ 7,843,377.00
|
(2)
|
|
LT1-V17
|
$ 7,843,377.00
|
(3)
|
|
LT1-F18
|
$ 8,175,163.50
|
(2)
|
-2-
|
Class
Designation
|
Initial Principal
Balance
|
Interest
Rate
|
|
LT1-V18
|
$ 8,175,163.50
|
(3)
|
|
LT1-F19
|
$ 12,095,772.00
|
(2)
|
|
LT1-V19
|
$ 12,095,772.00
|
(3)
|
|
LT1-F20
|
$ 10,935,936.00
|
(2)
|
|
LT1-V20
|
$ 10,935,936.00
|
(3)
|
|
LT1-F21
|
$ 9,860,172.00
|
(2)
|
|
LT1-V21
|
$ 9,860,172.00
|
(3)
|
|
LT1-F22
|
$ 8,818,945.00
|
(2)
|
|
LT1-V22
|
$ 8,818,945.00
|
(3)
|
|
LT1-F23
|
$ 7,667,386.50
|
(2)
|
|
LT1-V23
|
$ 7,667,386.50
|
(3)
|
|
LT1-F24
|
$ 4,979,129.50
|
(2)
|
|
LT1-V24
|
$ 4,979,129.50
|
(3)
|
|
LT1-F25
|
$ 4,711,935.00
|
(2)
|
|
LT1-V25
|
$ 4,711,935.00
|
(3)
|
|
LT1-F26
|
$ 4,522,471.50
|
(2)
|
|
LT1-V26
|
$ 4,522,471.50
|
(3)
|
|
LT1-F27
|
$ 4,296,560.00
|
(2)
|
|
LT1-V27
|
$ 4,296,560.00
|
(3)
|
|
LT1-F28
|
$ 4,053,839.50
|
(2)
|
|
LT1-V28
|
$ 4,053,839.50
|
(3)
|
|
LT1-F29
|
$ 3,825,611.00
|
(2)
|
|
LT1-V29
|
$ 3,825,611.00
|
(3)
|
|
LT1-F30
|
$ 3,612,702.00
|
(2)
|
|
LT1-V30
|
$ 3,612,702.00
|
(3)
|
|
LT1-F31
|
$ 3,412,058.00
|
(2)
|
|
LT1-V31
|
$ 3,412,058.00
|
(3)
|
|
LT1-F32
|
$ 3,219,043.50
|
(2)
|
|
LT1-V32
|
$ 3,219,043.50
|
(3)
|
|
LT1-F33
|
$ 3,018,353.50
|
(2)
|
|
LT1-V33
|
$ 3,018,353.50
|
(3)
|
|
LT1-F34
|
$ 2,846,370.50
|
(2)
|
|
LT1-V34
|
$ 2,846,370.50
|
(3)
|
|
LT1-F35
|
$ 2,694,336.50
|
(2)
|
|
LT1-V35
|
$ 2,694,336.50
|
(3)
|
|
LT1-F36
|
$ 2,550,619.00
|
(2)
|
|
LT1-V36
|
$ 2,550,619.00
|
(3)
|
|
LT1-F37
|
$ 2,414,751.50
|
(2)
|
|
LT1-V37
|
$ 2,414,751.50
|
(3)
|
|
LT1-F38
|
$ 2,286,296.50
|
(2)
|
|
LT1-V38
|
$ 2,286,296.50
|
(3)
|
|
LT1-F39
|
$ 2,164,844.50
|
(2)
|
|
LT1-V39
|
$ 2,164,844.50
|
(3)
|
|
LT1-F40
|
$ 2,050,002.50
|
(2)
|
-3-
|
Class
Designation
|
Initial
Principal
Balance
|
Interest
Rate
|
|
LT1-V40
|
$ 2,050,002.50
|
(3)
|
|
LT1-F41
|
$ 1,941,404.50
|
(2)
|
|
LT1-V41
|
$ 1,941,404.50
|
(3)
|
|
LT1-F42
|
$ 1,838,701.50
|
(2)
|
|
LT1-V42
|
$ 1,838,701.50
|
(3)
|
|
LT1-F43
|
$ 1,741,568.00
|
(2)
|
|
LT1-V43
|
$ 1,741,568.00
|
(3)
|
|
LT1-F44
|
$ 32,138,167.50
|
(2)
|
|
LT1-V44
|
$ 32,138,167.50
|
(3)
|
|
LT1-R
|
(4)
|
(4)
|
|
(1)
|
For
any Distribution Date (and the related Interest Accrual Period) the
interest rate for the Class LT1-A Interest shall be the Net WAC Rate.
|
|
(2)
|
For
any Distribution Date (and the related Interest Accrual Period) the
interest rate for each of these Lower Tier Interests shall be the
lesser
of (i) 10.90% and (ii) the product of (a) the Net WAC Rate and (b)
2.
|
|
(3)
|
For
any Distribution Date (and the related Interest Accrual Period) the
interest rate for each of these Lower Tier Interests shall be the
excess,
if any, of (i) the product of (a) the Net WAC Rate and (b) 2, over
(ii)
10.90%.
|
|
(4)
|
The
Class LT1-R interest shall not have a principal amount and shall
not bear
interest. The Class LT1-R interest is hereby designated as the sole
class
of residual interest in REMIC 1.
|
(5)
This interest shall have an initial principal balance equal to the excess of
the
aggregate stated Principal Balance of the Mortgage Loans as of the Cut-off
Date
over the aggregate initial principal balance of each remaining interest in
REMIC
1.
On
each
Distribution Date, the Securities Administrator shall first pay or charge as
an
expense of REMIC 1 all expenses of the Trust Fund for such Distribution Date,
other than any Net Swap Payment or Swap Termination Payment required to be
made
from the Trust Fund.
On
each
Distribution Date the Securities Administrator shall distribute the Interest
Remittance Amount (net of expenses described in the preceding paragraph) with
respect to each of the Lower Tier Interests in REMIC 1 based on the
above-described interest rates.
On
each
Distribution Date, the Securities Administrator shall distribute the Principal
Remittance Amount with respect to the Lower Tier Interests in REMIC 1, first
to
the Class LT1-A Interest until its principal balance is reduced to zero, and
then sequentially, to the other Lower Tier Interests in REMIC 1 in ascending
order of their numerical class designation, and, with respect to each pair
of
classes having the same numerical designation, in equal amounts to each such
class, until the principal balance of each such class is reduced to zero. All
losses on the Mortgage Loans shall be allocated among the Lower Tier Interests
in REMIC 1 in the same manner that principal distributions are
allocated.
-4-
On
each
Distribution Date, the Securities Administrator shall distribute the Prepayment
Charges collected during the preceding Prepayment Period to the Class LT1-F41
Lower Tier Interest.
REMIC
2:
The
following table sets forth the designations, principal balances and interest
rates for each interest in REMIC 2, each of which (other than the Class LT2-R
interest) is hereby designated as a regular interest in REMIC 2 (the “REMIC 2
Regular Interests”):
|
REMIC
2
Lower
Tier
Class
Designation
|
REMIC
2
Lower
Tier
Interest
Rate
|
Initial
Class
Principal
Amount
|
Corresponding
Class
of
Certificate(s)
|
|
Class
LT2-I-A
|
(1)
|
(4)
|
I-A
|
|
Class
LT2-II-A1
|
(1)
|
(4)
|
II-A-1
|
|
Class
LT2-II-A2
|
(1)
|
(4)
|
II-A-2
|
|
Class
LT2-II-A3
|
(1)
|
(4)
|
II-A-3
|
|
Class
LT2-II-A4
|
(1)
|
(4)
|
II-A-4
|
|
Class
LT2-M1
|
(1)
|
(4)
|
M-1
|
|
Class
LT2-M2
|
(1)
|
(4)
|
M-2
|
|
Class
LT2-M3
|
(1)
|
(4)
|
M-3
|
|
Class
LT2-M4
|
(1)
|
(4)
|
M-4
|
|
Class
LT2-M5
|
(1)
|
(4)
|
M-5
|
|
Class
LT2-M6
|
(1)
|
(4)
|
M-6
|
|
Class
LT2-M7
|
(1)
|
(4)
|
M-7
|
|
Class
LT2-M8
|
(1)
|
(4)
|
M-8
|
|
Class
LT2-M9
|
(1)
|
(4)
|
M-9
|
|
Class
LT2-M10
|
(1)
|
(4)
|
M-10
|
|
Class
LT2-Q
|
(1)
|
(5)
|
N/A
|
|
Class
LT2-IO
|
(2)
|
(2)
|
N/A
|
|
Class
LT2-R
|
(3)
|
(3)
|
R
|
___________________________
|
(1)
|
For
any Distribution Date (and the related Interest Accrual Period) the
interest rate for each of these Lower Tier Interests in REMIC 2 is
a per
annum rate equal to the weighted average of the interest rates on
the
Lower Tier Interests in REMIC 1 for such Distribution Date; provided,
however,
that for any Distribution Date on which the Class LT2-IO Interest
is
entitled to a portion of the interest accruals on a Lower Tier Interest
in
REMIC 1 having an “F” in its class designation, as described in footnote
two below, such weighted average shall be computed by first subjecting
the
rate on such Lower Tier Interest in REMIC 1 to a cap equal to Swap
LIBOR
for such Distribution Date.
|
|
(2)
|
The
Class LT2-IO Interest is an interest only class that does not have
a
principal balance. For only those Distribution Dates listed in the
first
column in the table below, the Class LT2-IO Interest shall be entitled
to
interest accrued on the Lower Tier Interest in REMIC 1 listed in
the
second column in the table below at a per annum rate equal to the
excess,
if any, of (i) the interest rate for such Lower Tier Interest in
REMIC 1
for such Distribution Date over (ii) Swap LIBOR for such Distribution
Date.
|
|
Distribution
Dates
|
REMIC
1
Class Designation
|
|
2
|
Class
LT1-F1
|
|
2-3
|
Class
LT1-F2
|
|
2-4
|
Class
LT1-F3
|
-5-
|
Distribution
Dates
|
REMIC
1
Class Designation
|
|
2-5
|
Class
LT1-F4
|
|
2-6
|
Class
LT1-F5
|
|
2-7
|
Class
LT1-F6
|
|
2-8
|
Class
LT1-F7
|
|
2-9
|
Class
LT1-F8
|
|
2-10
|
Class
LT1-F9
|
|
2-11
|
Class
LT1-F10
|
|
2-12
|
Class
LT1-F11
|
|
2-13
|
Class
LT1-F12
|
|
2-14
|
Class
LT1-F13
|
|
2-15
|
Class
LT1-F14
|
|
2-16
|
Class
LT1-F15
|
|
2-17
|
Class
LT1-F16
|
|
2-18
|
Class
LT1-F17
|
|
2-19
|
Class
LT1-F18
|
|
2-20
|
Class
LT1-F19
|
|
2-21
|
Class
LT1-F20
|
|
2-22
|
Class
LT1-F21
|
|
2-23
|
Class
LT1-F22
|
|
2-24
|
Class
LT1-F23
|
|
2-25
|
Class
LT1-F24
|
|
2-26
|
Class
LT1-F25
|
|
2-27
|
Class
LT1-F26
|
|
2-28
|
Class
LT1-F27
|
|
2-29
|
Class
LT1-F28
|
|
2-30
|
Class
LT1-F29
|
|
2-31
|
Class
LT1-F30
|
|
2-32
|
Class
LT1-F31
|
|
2-33
|
Class
LT1-F32
|
|
2-34
|
Class
LT1-F33
|
|
2-35
|
Class
LT1-F34
|
|
2-36
|
Class
LT1-F35
|
|
2-37
|
Class
LT1-F36
|
|
2-38
|
Class
LT1-F37
|
|
2-39
|
Class
LT1-F38
|
|
2-40
|
Class
LT1-F39
|
|
2-41
|
Class
LT1-F40
|
|
2-42
|
Class
LT1-F41
|
|
2-43
|
Class
LT1-F42
|
|
2-44
|
Class
LT1-F43
|
|
2-45
|
Class
LT1-F44
|
|
(3)
|
The
Class LT2-R interest is the sole class of residual interests in REMIC
2.
It does not have an interest rate or a principal balance.
|
|
(4)
|
This
Lower Tier Interest shall have an initial class principal amount
equal to
one-half of the initial Class Certificate Balance of its Corresponding
Class of Certificates.
|
|
(5)
|
This
Lower Tier Interest shall have an initial class principal amount
equal to
the excess of (i) the Pool Stated Principal Balance as of the Cut-off
Date, over (ii) the aggregate initial class principal amount of each
other
regular interest in REMIC 2 (other than any interest-only Lower Tier
Interest).
|
On
each
Distribution Date, interest shall be distributed on the Lower Tier Interests
in
REMIC 2 based on the above-described interest rates; provided,
however,
that
interest that accrues on the Class LT2-Q Interest shall be deferred in an amount
equal to one-half of the increase, if any, in the Overcollateralization Amount
for such Distribution Date. Any interest so deferred shall itself bear interest
at the interest rate for the Class LT2-Q Interest. An amount equal to the
interest so deferred shall be distributed as additional principal on the other
Lower Tier Interests in REMIC 2 having a principal balance in the manner
described under priority (a) below.
-6-
On
each
Distribution Date principal shall be distributed, and Realized Losses shall
be
allocated, among the Lower Tier Interests in REMIC 2 in the following order
of
priority:
(a) First,
to
the Class LT2-I-A, Class LT2-II-A1, Class LT2-II-A2, Class LT2-II-A3, Class
LT2-II-A4, Class LT2-M1, Class LT2-M2, Class LT2-M3, Class LT2-M4, Class
LT2-M5, Class LT2-M6, Class LT2-M7, Class LT2-M8, Class LT2-M9, and Class
LT2-M10 Interests until the principal balance of each such Lower Tier Interest
equals one-half of the Class Certificate Balance of the Corresponding Class
of
Certificates for such interest immediately after such Distribution Date;
and
(b) Second,
to the Class LT2-Q Interests, any remaining amounts.
On
each
Distribution Date, the Securities Administrator shall be deemed to have
distributed the Prepayment Charges passed through with respect to the Class
LT1-F44 Lower Tier Interest in REMIC 1 on such Distribution Date to the Class
LT2-Q Interest.
Upper
Tier REMIC
The
Upper
Tier REMIC shall issue the following Classes of Upper Tier REMIC Regular
Interests and each such interest, other than the Class R Interest, is hereby
designated as a regular interest in the Upper Tier REMIC.
Upper
Tier REMIC
|
Upper
Tier REMIC
Class Designation
|
Upper
Tier REMIC Interest Rate and Corresponding Class Interest
Rate
|
Initial
Upper Tier REMIC Principal Amount and Corresponding Class Certificate
Balance or Class Notional Balance
|
Corresponding
Class of
Certificates
|
|||
|
Class I-A
|
(1)
|
$195,515,000.00
|
Class I-A
|
|||
|
Class II-A-1
|
(2)
|
$180,356,000.00
|
Class II-A-1
|
|||
|
Class II-A-2
|
(3)
|
$33,480,000.00
|
Class II-A-2
|
|||
|
Class II-A-3
|
(4)
|
$87,647,000.00
|
Class II-A-3
|
|||
|
Class II-A-4
|
(5)
|
$27,822,000.00
|
Class II-A-4
|
|||
|
Class M-1
|
(6)
|
$29,797,000.00
|
Class M-1
|
|||
|
Class M-2
|
(6)
|
$23,390,000.00
|
Class M-2
|
|||
|
Class M-3
|
(6)
|
$6,728,000.00
|
Class M-3
|
|||
|
Class M-4
|
(6)
|
$7,690,000.00
|
Class M-4
|
|||
|
Class M-5
|
(6)
|
$7,049,000.00
|
Class M-5
|
|||
|
Class M-6
|
(6)
|
$4,806,000.00
|
Class M-6
|
|||
|
Class M-7
|
(6)
|
$7,049,000.00
|
Class M-7
|
|||
|
Class M-8
|
(6)
|
$5,126,000.00
|
Class M-8
|
|||
|
Class M-9
|
(6)
|
$6,408,000.00
|
Class M-9
|
|||
|
Class M-10
|
(6)
|
$7,690,000.00
|
Class M-10
|
|||
|
Class X
|
(7)
|
(7)
|
Class X
|
|||
|
Class R
|
(8)
|
(8)
|
Class R
|
|||
|
Class P
|
(9)
|
(9)
|
Class
P
|
-7-
|
(1)
|
The
Class I-A Interest will bear interest during each Interest Accrual
Period
at a per annum rate equal to (a) on or prior to the Optional
Termination Date, the lesser of (i) LIBOR plus the applicable
Interest Margin and (ii) the Group I Available Funds Cap or
(b) after the Optional Termination Date, the lesser of (i) LIBOR
plus the applicable Interest Margin and (ii) the Group I Available
Funds Cap. For purposes of the REMIC Provisions, the reference to
“Group I
Available Funds Cap” in clause (ii) of the preceding sentence shall be
deemed a reference to the REMIC 2 Net Funds Cap; therefore, on any
Distribution Date on which the Interest Rate for the Class I-A
Certificates exceeds the REMIC 2 Net Funds Cap, interest accruals
based on
such excess shall be treated as having been paid from the Excess
Reserve
Fund Account or the Supplemental Interest Trust, as applicable; on
any
Distribution Date on which the Interest Rate on the Class I-A Certificates
is based on the Group I Available Funds Cap, the amount of interest
that
would have accrued on the Class I-A Certificates if the REMIC 2 Net
Funds
Cap were substituted for the Group I Available Funds Cap shall be
treated
as having been paid by the Class I-A Certificateholders to the
Supplemental Interest Trust, all pursuant to and as further provided
in
Section 8.11 hereof.
|
|
(2)
|
The
Class II-A-1 Interest will bear interest during each Interest Accrual
Period at a per annum rate equal to (a) on or prior to the Optional
Termination Date, the lesser of (i) LIBOR plus the applicable
Interest Margin and (ii) the Group II Available Funds Cap or
(b) after the Optional Termination Date, the lesser of (i) LIBOR
plus the applicable Interest Margin and (ii) the Group II Available
Funds Cap. For purposes of the REMIC Provisions, the reference to
“Group
II Available Funds Cap” in clause (ii) of the preceding sentence shall be
deemed a reference to the REMIC 2 Net Funds Cap; therefore, on any
Distribution Date on which the Interest Rate for the Class II-A-1
Certificates exceeds the REMIC 2 Net Funds Cap, interest accruals
based on
such excess shall be treated as having been paid from the Excess
Reserve
Fund Account or the Supplemental Interest Trust, as applicable; on
any
Distribution Date on which the Interest Rate on the Class II-A-1
Certificates is based on the Group II Available Funds Cap, the amount
of
interest that would have accrued on the Class II-A-1 Certificates
if the
REMIC 2 Net Funds Cap were substituted for the Group II Available
Funds
Cap shall be treated as having been paid by the Class II-A-1
Certificateholders to the Supplemental Interest Trust, all pursuant
to and
as further provided in Section 8.11
hereof.
|
|
(3)
|
The
Class II-A-2 Interest will bear interest during each Interest Accrual
Period at a per annum rate equal to (a) on or prior to the Optional
Termination Date, the lesser of (i) LIBOR plus the applicable
Interest Margin and (ii) the Group II Available Funds Cap or
(b) after the Optional Termination Date, the lesser of (i) LIBOR
plus the applicable Interest Margin and (ii) the Group II Available
Funds Cap. For purposes of the REMIC Provisions, the reference to
“Group
II Available Funds Cap” in clause (ii) of the preceding sentence shall be
deemed a reference to the REMIC 2 Net Funds Cap; therefore, on any
Distribution Date on which the Interest Rate for the Class II-A-2
Certificates exceeds the REMIC 2 Net Funds Cap, interest accruals
based on
such excess shall be treated as having been paid from the Excess
Reserve
Fund Account or the Supplemental Interest Trust, as applicable; on
any
Distribution Date on which the Interest Rate on the Class II-A-2
Certificates is based on the Group II Available Funds Cap, the amount
of
interest that would have accrued on the Class II-A-2 Certificates
if the
REMIC 2 Net Funds Cap were substituted for the Group II Available
Funds
Cap shall be treated as having been paid by the Class II-A-2
Certificateholders to the Supplemental Interest Trust, all pursuant
to and
as further provided in Section 8.11
hereof.
|
-8-
|
(4)
|
The
Class II-A-3 Interest will bear interest during each Interest Accrual
Period at a per annum rate equal to (a) on or prior to the Optional
Termination Date, the lesser of (i) LIBOR plus the applicable
Interest Margin and (ii) the Group II Available Funds Cap or
(b) after the Optional Termination Date, the lesser of (i) LIBOR
plus the applicable Interest Margin and (ii) the Group II Available
Funds Cap. For purposes of the REMIC Provisions, the reference to
“Group
II Available Funds Cap” in clause (ii) of the preceding sentence shall be
deemed a reference to the REMIC 2 Net Funds Cap; therefore, on any
Distribution Date on which the Interest Rate for the Class II-A-3
Certificates exceeds the REMIC 2 Net Funds Cap, interest accruals
based on
such excess shall be treated as having been paid from the Excess
Reserve
Fund Account or the Supplemental Interest Trust, as applicable; on
any
Distribution Date on which the Interest Rate on the Class II-A-3
Certificates is based on the Group II Available Funds Cap, the amount
of
interest that would have accrued on the Class II-A-3 Certificates
if the
REMIC 2 Net Funds Cap were substituted for the Group II Available
Funds
Cap shall be treated as having been paid by the Class II-A-3
Certificateholders to the Supplemental Interest Trust, all pursuant
to and
as further provided in Section 8.11
hereof.
|
|
(5)
|
The
Class II-A-4 Interest will bear interest during each Interest Accrual
Period at a per annum rate equal to (a) on or prior to the Optional
Termination Date, the lesser of (i) LIBOR plus the applicable
Interest Margin and (ii) the Group II Available Funds Cap or
(b) after the Optional Termination Date, the lesser of (i) LIBOR
plus the applicable Interest Margin and (ii) the Group II Available
Funds Cap. For purposes of the REMIC Provisions, the reference to
“Group
II Available Funds Cap” in clause (ii) of the preceding sentence shall be
deemed a reference to the REMIC 2 Net Funds Cap; therefore, on any
Distribution Date on which the Interest Rate for the Class II-A-4
Certificates exceeds the REMIC 2 Net Funds Cap, interest accruals
based on
such excess shall be treated as having been paid from the Excess
Reserve
Fund Account or the Supplemental Interest Trust, as applicable; on
any
Distribution Date on which the Interest Rate on the Class II-A-4
Certificates is based on the Group II Available Funds Cap, the amount
of
interest that would have accrued on the Class II-A-4 Certificates
if the
REMIC 2 Net Funds Cap were substituted for the Group II Available
Funds
Cap shall be treated as having been paid by the Class II-A-4
Certificateholders to the Supplemental Interest Trust, all pursuant
to and
as further provided in Section 8.11
hereof.
|
|
(6)
|
The
Class M-1, Class M-2, Class M-3, Class M-4,
Class M-5, Class M-6, Class M-7, Class M-8,
Class M-9 and Class M-10 Interests will bear interest during
each Interest Accrual Period at a per annum rate equal to (a) on or
prior to the Optional Termination Date, the lesser of (i) LIBOR plus
the applicable Interest Margin and (ii) the Class M Available Funds
Cap or (b) after the Optional Termination Date, the lesser of
(i) LIBOR plus the applicable Interest Margin and (ii) the Class
M Available Funds Cap. For purposes of the REMIC Provisions, the
reference
to Class M Available Funds Cap in clause (ii) of the preceding sentence
shall be deemed to be a reference to the REMIC 2 Net Funds Cap; therefore,
on any Distribution Date on which the Interest Rate for the Class
▇-▇,
▇-▇, ▇-▇, ▇-▇, ▇-▇, M-6, M-7, M-8, M-9 and M-10 Certificates, as
applicable, exceeds the REMIC 2 Net Funds Cap, interest accruals
based on
such excess shall be treated as having been paid from the Excess
Reserve
Fund Account or the Supplemental Interest Trust, as applicable; on
any
Distribution Date on which the Interest Rate on the Class ▇-▇, ▇-▇,
▇-▇,
▇-▇, ▇-▇, M-6, M-7, M-8, M-9 and M-10 Certificates, as applicable, is
based on the Class M Available Funds Cap, the amount of interest
that
would have accrued on each such Class of Certificates if the REMIC
2 Net
Funds Cap were substituted for the Class M Available Funds Cap shall
be
treated as having been paid by the Class ▇-▇, ▇-▇, ▇-▇, ▇-▇, ▇-▇,
M-6,
M-7, M-8, M-9 and M-10 Certificateholders, as applicable, to the
Supplemental Interest Trust, all pursuant to and as further provided
in
Section 8.11 hereof.
|
|
(7)
|
For
purposes of the REMIC Provisions, the Class X Interest shall have
an
initial principal balance of $10,252,547.75 (initial overcollateralization
of $10,252,647.75 less $100.00 attributable to the Class P Principal
Amount), and the right to receive distributions of such amount represents
a regular interest in the Upper Tier REMIC. The Class X Certificate
shall
also comprise two notional components, each of which represents a
regular
interest in the Upper Tier REMIC. The first such component has a
notional
balance that will at all times equal the aggregate of the Class
Certificate Balances of the Lower Tier Interests in REMIC 2, and,
for each
Distribution Date (and the related Interest Accrual Period) this
notional
component shall bear interest at a per annum rate equal to the excess,
if
any, of (i) (a) the weighted average of the interest rates on the
Lower
Tier Interests in REMIC 2 (other than any interest-only regular interest)
minus (b) the Credit Risk Manager’s Fee Rate over (ii) the Adjusted Lower
Tier WAC. The second notional component represents the right to receive
all distributions in respect of the Class LT2-IO interest in REMIC
2 (the
“LT3-I” interest). In addition, for purposes of the REMIC Provisions, the
Class X Certificate shall represent beneficial ownership of (i) the
Excess
Reserve Fund Account; (ii) the Supplemental Interest Trust, including
the
Swap Agreement, Swap Account, Cap Agreement, and Cap Account, and
(iii) an
interest in the notional principal contracts described in Section
8.11
hereof.
|
-9-
|
(8)
|
The
Class R Interest is the sole Class of residual interest in the Upper
Tier REMIC. The Class R Interest is issued without a principal amount
does not bear a stated Interest Rate. The Class R Certificate will
be
issued as a single certificate evidencing the initial Percentage
Interest
of such Class, and shall represent ownership of each of the Class
R, Class
LT1-R and Class LT2-R Interests.
|
|
(9)
|
The
Class P Certificate shall not bear interest at a stated Interest
Rate.
Prepayment Charges paid with respect to the Mortgage Loans shall
be paid
to the Class P Certificateholders as provided in Section 4.02(b).
For
purposes of the REMIC Provisions, the Class P Certificate shall represent
a regular interest in the Upper Tier REMIC. The Class P Certificate
will
have a Class P Principal Amount of
$100.
|
The
minimum denomination for each Class of Certificates, other than the
Class P, Class R and the Class X Certificates, will be $25,000 of
Certificate Balance ($100,000 with respect to initial investors resident in
a
Member State of the European Economic Area subject to the EU Prospectus
Directive 2003/71/EC) with integral multiples of $1 in excess thereof, except
that one Certificate in each Class may be issued in a different amount. The
minimum denomination for each of the Class P and Class X Certificates
will be a 10.00% Percentage Interest in such Class, and the minimum denomination
for the Class R Certificates shall be 100% Percentage Interest in such
Class.
Set
forth
below are designations of Classes of Certificates to the categories used
herein:
|
Book-Entry
Certificates
|
All
Classes of Certificates other than the Physical
Certificates.
|
|
Class A
Certificates
|
Class
I-A, Class II-A-1, Class II-A-2, Class II-A-3 and Class II-A-4
Certificates.
|
|
Class M
Certificates
|
Class M-1,
Class M-2, Class M-3, Class M-4, Class M-5,
Class M-6, Class M-7, Class M-8, Class M-9 and
Class M-10 Certificates.
|
ERISA-Restricted
|
Certificates
|
Any
Class P, Class X and Class R Certificates and any Certificate with
a
rating which falls below the lowest applicable permitted rating under
the
Underwriters’ Exemption.
|
-10-
ERISA-Restricted
|
Trust Certificates
|
Any
Offered Certificate and Class M-10 Certificate prior to the termination
of
the Cap Agreement and the Swap
Agreement.
|
|
Group
I Certificates
|
The
Class I-A Certificates.
|
|
Group
II Certificates
|
Collectively,
the Class II-A-1, Class II-A-2, Class II-A-3 and Class II-A-4
Certificates.
|
|
LIBOR
Certificates
|
Collectively,
the Class A Certificates and the Class M
Certificates.
|
|
Non-Delay
Certificates
|
The
Class A Certificates, the Class M Certificates and Class X
Certificates.
|
|
Offered
Certificates
|
All
Classes of Certificates other than the Private
Certificates.
|
|
Physical
Certificates
|
Class P,
Class X and Class R
Certificates.
|
|
Private
Certificates
|
Class
M-10, Class P, Class X and Class R
Certificates.
|
|
Rating
Agencies
|
Moody’s
and Standard & Poor’s.
|
|
Regular
Certificates
|
All
Classes of Certificates other than the Class R
Certificates.
|
|
Residual
Certificates
|
Class R
Certificates.
|
ARTICLE
I
DEFINITIONS
Whenever
used in this Agreement, the following words and phrases, unless the context
otherwise requires, shall have the following meanings:
10-K
Filing Deadline:
As
defined in Section 8.12(a)(ii).
Accepted
Servicing Practices:
With
respect to any Mortgage Loan and the Servicer, the servicing and administration
of such Mortgage Loan (i) in the same manner in which, and with the same
care, skill, prudence and diligence with which the Servicer generally services
and administers similar mortgage loans with similar mortgagors (A) for
other third parties, giving due consideration to customary and usual standards
of practice of prudent institutional residential mortgage lenders servicing
their own mortgage loans or (B) held in the Servicer’s own portfolio,
whichever standard is higher, and (ii) in accordance with applicable local,
state and federal laws, rules and regulations.
-11-
Account:
Any of
the Collection Account, the Distribution Account and any Escrow Account, and
with respect to the Supplemental Interest Trust, the Excess Reserve Fund Account
and the Supplemental Interest Trust Account. Each Account shall be an Eligible
Account.
Additional
Disclosure Notification:
The
form of notice set forth on Exhibit Y.
Additional
Form 10-D Disclosure:
As
defined in Section 8.12(a)(i).
Additional
Form 10-K Disclosure:
As
defined in Section 8.12(a)(ii).
Additional
Termination Event:
As
defined in the Cap Agreement or the Swap Agreement, as applicable.
Adjustable
Rate Mortgage Loan:
A
Mortgage Loan which provides for the adjustment of the Mortgage Rate payable
in
respect thereto.
Adjusted
Lower Tier WAC: For
any
Distribution Date (and the related Interest Accrual Period), an amount equal
to
(i) two, multiplied by (ii) the weighted average of the interest rates for
such
Distribution Date for the Class LT2-I-A, LT2-II-A-1, LT2-II-A-2, LT2-II-A-3,
LT2-II-A-4, LT2-M-1, LT2-M-2, LT2-M-3, LT2-M-4, LT2-M-5, LT2-M-6, LT2-M-7,
LT2-M-8, LT2-M-9, LT2-M-10 and LT2-Q Interests, weighted in proportion to their
Class Certificate Balances as of the beginning of the related Interest Accrual
Period and computed by subjecting the rate on the Class LT2-Q Interest to a
cap
of 0.00%, and by subjecting the rate on each of the Class LT2-I-A, LT2-II-A-1,
LT2-II-A-2, LT2-II-A-3, LT2-II-A-4, LT2-M-1, LT2-M-2, LT2-M-3, LT2-M-4, LT2-M-5,
LT2-M-6, LT2-M-7, LT2-M-8, LT2-M-9 and LT2-M-10 Interests to a cap that
corresponds to the Interest Rate (determined by substituting the REMIC 2 Net
Funds Cap for the applicable Available Funds Cap) for the Corresponding Class
of
Certificates; provided,
however,
that
for each Class of LIBOR Certificates, the Certificate Interest Rate shall be
multiplied by the quotient of (a) the actual number of days in the Interest
Accrual Period, divided by (b) 30.
Adjustment
Date:
As to
any Adjustable Rate Mortgage Loan, the first Due Date on which the related
Mortgage Rate adjusts as set forth in the related Mortgage Note and each Due
Date thereafter on which the Mortgage Rate adjusts as set forth in the related
Mortgage Note.
Advance:
Any
P&I Advance or Servicing Advance.
Affected
Party:
As
defined in the Swap Agreement.
Affiliate:
With
respect to any Person, any other Person controlling, controlled by or under
common control with such first Person. For the purposes of this definition,
“control” means the power to direct the management and policies of such Person,
directly or indirectly, whether through the ownership of voting securities,
by
contract or otherwise; and the terms “controlling” and “controlled” have
meanings correlative to the foregoing.
-12-
Agreement:
This
Pooling and Servicing Agreement and all amendments or supplements
hereto.
Amounts
Held for Future Distribution:
As to
the Certificates on any Distribution Date, the aggregate amount held in the
Collection Account at the close of business on the related Determination Date
on
account of (i) Principal Prepayments, Insurance Proceeds, Condemnation
Proceeds, Liquidation Proceeds and Subsequent Recoveries on the Mortgage Loans
received after the end of the related Prepayment Period and (ii) all
Scheduled Payments on the Mortgage Loans due after the end of the related Due
Period.
Applied
Realized Loss Amount:
With
respect to any Distribution Date, the amount, if any, by which the aggregate
Class Certificate Balance of the LIBOR Certificates after distributions of
principal on such Certificates on such Distribution Date exceeds the aggregate
Stated Principal Balance of the Mortgage Loans for such Distribution
Date.
Appraised
Value:
The
value set forth in an appraisal made in connection with the origination of
the
related Mortgage Loan as the value of the Mortgaged Property.
Assignment
of Mortgage:
An
assignment of the Mortgage, notice of transfer or equivalent instrument in
recordable form (other than the assignee’s name and recording information not
yet returned from the recording office), reflecting the sale of the Mortgage
to
the Trustee.
Available
Funds:
With
respect to any Distribution Date and the Mortgage Loans to the extent received
by the Master Servicer (x) the sum of (i) all scheduled installments
of interest (net of the related Expense Fees) and principal due on the Due
Date
on such Mortgage Loans in the related Due Period and received by the Servicer
on
or prior to the related Determination Date, together with any
P&I Advances in respect thereof; (ii) all Condemnation Proceeds,
Insurance Proceeds, Liquidation Proceeds and Subsequent Recoveries received
by
the Servicer during the related Prepayment Period (in each case, net of
unreimbursed expenses incurred in connection with a liquidation or foreclosure
and unreimbursed Advances, if any); (iii) all partial or full prepayments
on the Mortgage Loans received by the Servicer during the related Prepayment
Period together with all Compensating Interest paid by the Servicer in
connection therewith (excluding any Prepayment Charges); (iv) all
Substitution Adjustment Amounts with respect to the substitutions of Mortgage
Loans that occur on or prior to the related Determination Date; (v) all
amounts received with respect to such Distribution Date as the Repurchase Price
in respect of a Mortgage Loan repurchased by the Originator or the Sponsor
on or
prior to the related Determination Date; and (vi) the proceeds with respect
to the termination of the Trust Fund pursuant to clause (a) of
Section 11.01; reduced by (y) amounts in reimbursement for Advances
previously made with respect to the Mortgage Loans and other amounts as to
which
the Servicer, the Depositor, the Master Servicer, the Credit Risk Manager,
the
Securities Administrator or the Trustee are entitled to be paid or reimbursed
pursuant to this Agreement.
Back-up
▇▇▇▇▇▇▇▇-▇▇▇▇▇ Certification:
As
defined in Section 3.24.
-13-
Basic
Principal Payment Amount:
With
respect to any Distribution Date, the excess of (i) the Principal
Remittance Amount for such Distribution Date over (ii) the Excess
Overcollateralization Amount, if any, for such Distribution Date.
Basis
Risk Carryover Amount:
With
respect to each Class of LIBOR Certificates, as of any Distribution Date,
the sum of (A) if on such Distribution Date the Interest Rate for any
Class of LIBOR Certificates is based upon the Group I Available Funds Cap,
the Group II Available Funds Cap or the Class M Available Funds Cap, as
applicable, the excess of (i) the amount of interest such Class of
Certificates would otherwise be entitled to receive on such Distribution Date
had such Interest Rate been calculated as the sum of LIBOR and the applicable
Interest Margin on such Class of Certificates for such Distribution Date,
over (ii) the amount of interest payable on such Class of
Certificates, in the case of any Group I Certificates, based on the Group I
Available Funds Cap, in the case of any Group II Certificates, based on the
Group II Available Funds Cap and in the case of any Class of Class M
Certificates, based on the Class M Available Funds Cap and (B) the portion
of any such excess described in clause (A) for such Class of
Certificates from all previous Distribution Dates not previously paid, together
with interest thereon at a rate equal the applicable Interest Rate for each
such
Class of Certificates for such Distribution Date.
Basis
Risk Payment:
For any
Distribution Date, an amount equal to the lesser of (i) the aggregate of
the Basis Risk Carryover Amounts of the LIBOR Certificates for such Distribution
Date and (ii) the Class X Distributable Amount (prior to any reduction
for Basis Risk Payments).
Best’s:
Best’s
Key Rating Guide, as the same shall be amended from time to time.
Book-Entry
Certificates:
As
specified in the Preliminary Statement.
Business
Day:
Any day
other than (i) Saturday or Sunday, or (ii) a day on which banking and
savings and loan institutions, in (a) the States of New York, California,
Maryland or Minnesota, (b) the Commonwealth of Pennsylvania or any other
State in which the Servicer’s servicing operations are located, or (c) any
State in which the Corporate Trust Office is located, are authorized or
obligated by law or executive order to be closed.
Cap
Account:
The
sub-account of the Supplemental Interest Trust Account created pursuant to
Section 4.06(a).
Cap
Agreement:
The
interest rate cap agreement entered into by the Supplemental Interest Trust
Trustee on behalf of the Supplemental Interest Trust and the Cap Counterparty,
dated July 3, 2007, which agreement provides for the monthly payment specified
to the Supplemental Interest Trust (for the benefit of Certificateholders)
commencing with the Distribution Date in January 2008 and ending on the
Distribution Date in July 2014, by the Cap Counterparty, but subject to the
conditions set forth therein, together with any schedule, confirmations or
other
agreements relating thereto, attached as Exhibit P.
Cap
Amount:
With
respect to each Distribution Date, the amount of any Cap Payment deposited
into
the Cap Account.
-14-
Cap
Counterparty:
The
counterparty to the Supplemental Interest Trust under the Cap Agreement, and
any
successor in interest or its assigns. Initially, the Cap Counterparty shall
be
Credit Suisse International.
Cap
Payment:
With
respect to each Distribution Date, any payment required to be made by the Cap
Counterparty to the Supplemental Interest Trust pursuant to the terms of the
Cap
Agreement.
Cap
Payment Date:
For as
long as the Cap Agreement is in effect or any amounts remain unpaid thereunder,
the Business Day immediately preceding each Distribution Date.
Cap
Replacement Receipts:
As
defined in Section 4.08(b)(i).
Cap
Replacement Receipts Account:
As
defined in Section 4.08(b)(i).
Cap
Termination Payment:
Upon
the designation of an “Early Termination Date” as defined in the Cap Agreement,
the payment required to be made by the Cap Counterparty to the Supplemental
Interest Trust pursuant to the terms of the Cap Agreement and any unpaid amounts
due on previous Cap Payment Dates and accrued interest thereon as provided
in
the Cap Agreement, as calculated by the Cap Counterparty and furnished to the
Securities Administrator.
Cap
Termination Receipts:
As
defined in Section 4.08(b)(i).
Cap
Termination Receipts Account:
As
defined in Section 4.08(b)(i).
Certificate:
Any one
of the Certificates executed and authenticated by the Securities Administrator
in substantially the forms attached hereto as exhibits.
Certificate
Balance:
With
respect to any Certificate, other than a Class X, Class P or
Class R Certificate, at any date, the maximum dollar amount of principal to
which the Holder thereof is then entitled hereunder, such amount being equal
to
the Denomination thereof minus all distributions of principal previously made
with respect thereto and in the case of any Class M Certificates, reduced by
any
Applied Realized Loss Amounts allocated to such Class of Certificates
pursuant to Section 4.05; provided,
however,
that
immediately following the Distribution Date on which a Subsequent Recovery
is
distributed, the Class Certificate Balances of any Class or Classes of
Certificates that have been previously reduced by Applied Realized Loss Amounts
will be increased, in order of seniority, by the amount of any Subsequent
Recovery distributed on such Distribution Date (up to the amount of Unpaid
Realized Loss Amount for such Class or Classes for such Distribution Date).
The Class P Certificates are issued with an initial Class P Principal
Amount of $100. The Class X and Class R Certificates have no
Certificate Balance.
Certificate
Group:
The
Group I Certificates or the Group II Certificates, as
applicable.
Certificate
Owner:
With
respect to a Book-Entry Certificate, the Person who is the beneficial owner
of
such Book-Entry Certificate.
-15-
Certificate
Register:
The
register maintained pursuant to Section 5.02.
Certificateholder
or
Holder:
The
person in whose name a Certificate is registered in the Certificate Register,
except that, solely for the purpose of giving any consent pursuant to this
Agreement, any Certificate registered in the name of the Depositor or any
Affiliate of the Depositor shall be deemed not to be Outstanding and the
Percentage Interest evidenced thereby shall not be taken into account in
determining whether the requisite amount of Percentage Interests necessary
to
effect such consent has been obtained; provided,
however,
that if
any such Person (including the Depositor) owns 100.00% of the Percentage
Interests evidenced by a Class of Certificates, such Certificates shall be
deemed to be Outstanding for purposes of any provision hereof that requires
the
consent of the Holders of Certificates of a particular Class as a condition
to the taking of any action hereunder. The Securities Administrator is entitled
to rely conclusively on a certification of the Depositor or any Affiliate of
the
Depositor in determining which Certificates are registered in the name of an
Affiliate of the Depositor.
Certification
Parties:
As
defined in Section 3.24.
Certifying
Person:
As
defined in Section 3.24.
Class:
All
Certificates bearing the same class designation as set forth in the Preliminary
Statement.
Class I-A
Certificates:
All
Certificates bearing the Class designation of “Class I-A”.
Class II-A-1
Certificates:
All
Certificates bearing the Class designation of “Class II-A-1”.
Class II-A-2
Certificates:
All
Certificates bearing the Class designation of “Class II-A-2”.
Class II-A-3
Certificates:
All
Certificates bearing the Class designation of “Class II-A-3”.
Class II-A-4
Certificates:
All
Certificates bearing the Class designation of “Class II-A-4”.
Class A
Certificates:
As
specified in the Preliminary Statement.
Class Certificate
Balance:
With
respect to any Class of LIBOR Certificates and as to any date of determination,
the aggregate of the Certificate Balances of all Certificates of such
Class as of such date. With respect to the Class X, Class P and Class R
Certificates, zero. With respect to any Lower Tier Interest and as to any date
of determination, the initial Class Principal Balance as shown or described
in
the table set forth in the Preliminary Statement to this Agreement for the
issuing REMIC, as reduced by any principal distributed with respect to such
Lower Tier Interest and Realized Losses allocated to such Lower Tier
Interest.
-16-
Class
I Shortfalls:
As
defined in Section 8.11 hereof. For
purposes of clarity, the Class I Shortfall for any Distribution Date shall
equal
the amount payable to the Derivative Counterparty on such Distribution Date
in
excess of the amount payable with respect to the Class LT4-I interest in the
Upper Tier REMIC on such Distribution Date, all as further provided in Section
8.11 hereof.
Class
M Available Funds Cap: With
respect to the Class M Certificates as of any Distribution Date, a per annum
rate equal to the weighted average of the Group I Available Funds Cap and the
Group II Available Funds Cap, weighted on the basis of the Group Subordinate
Amount for the Group I Mortgage Loans and the Group Subordinate Amount for
the
Group II Mortgage Loans, respectively.
Class M
Certificates:
As
specified in the Preliminary Statement.
Class M
Principal Payment Amount:
With
respect to any Distribution Date and any Class of Class M
Certificates, the lesser of (i) the excess of (a) the Principal
Payment Amount over (b) the aggregate amount distributed on that
Distribution Date as principal to all Classes of Certificates more senior than
that Class of Class M Certificates and (ii) the excess of (a) the sum
of the aggregate Class Certificate Balances of all Class of
Certificates more senior than that Class of Class M Certificates
(after giving effect to all amounts distributed on that Distribution Date to
those Classes of more senior certificates) and the Class Certificate
Balance of that Class of Class M Certificates immediately prior to
that Distribution Date over (b) the lesser of:
(x) the
percentage set forth in the table below for the applicable Class of
Class M Certificates multiplied by the aggregate Stated Principal Balance
of the Mortgage Loans for that Distribution Date:
|
Class
|
Percentage
|
|
|
M-1
|
73.10%
|
|
|
M-2
|
80.40%
|
|
|
M-3
|
82.50%
|
|
|
M-4
|
84.90%
|
|
|
M-5
|
87.10%
|
|
|
M-6
|
88.60%
|
|
|
M-7
|
90.80%
|
|
|
M-8
|
92.40%
|
|
|
M-9
|
94.40%
|
|
|
M-10
|
96.80%
|
and
(y) the
excess, if any, of the aggregate Stated Principal Balance of the Mortgage Loans
for that Distribution Date over 0.50% of the aggregate Stated Principal Balance
of the Mortgage Loans as of the Cut-off Date, until the Class Certificate
Balance of that Class of Class M Certificates has been reduced to
zero.
-17-
Class M-1
Certificates:
All
Certificates bearing the Class designation of “Class M-1”.
Class M-2
Certificates:
All
Certificates bearing the Class designation of “Class M-2”.
Class M-3
Certificates:
All
Certificates bearing the Class designation of “Class M-3”.
Class M-4
Certificates:
All
Certificates bearing the Class designation of “Class M-4”.
Class M-5
Certificates:
All
Certificates bearing the Class designation of “Class M-5”.
Class M-6
Certificates:
All
Certificates bearing the Class designation of “Class M-6”.
Class M-7
Certificates:
All
Certificates bearing the Class designation of “Class M-7”.
Class M-8
Certificates:
All
Certificates bearing the Class designation of “Class M-8”.
Class M-9
Certificates:
All
Certificates bearing the Class designation of “Class M-9”.
Class M-10
Certificates:
All
Certificates bearing the Class designation of “Class M-10”.
Class Notional
Balance:
Not
applicable.
Class P
Certificates:
All
Certificates bearing the Class designation of “Class P”.
Class P
Principal Amount:
As of
the Closing Date, $100.00.
Class R
Certificates:
All
Certificates bearing the Class designation of “Class R”.
Class X
Certificates:
All
Certificates bearing the Class designation of “Class X”.
Class
X Distributable Amount:
With
respect to any Distribution Date, the amount of interest that has accrued on
the
Class X Notional Balance, as described in the Preliminary Statement, but that
has not been distributed prior to such date. In addition, such amount shall
include the initial Overcollateralization Amount of $10,252,647.75 less $100
(which $100 shall be allocated to the Class P Certificates) to the extent such
amount has not been distributed on an earlier Distribution Date as part of
the
Overcollateralization Reduction Amount.
-18-
Class
X Notional Balance:
With
respect to
any
Distribution Date (and the related Interest Accrual Period) the aggregate
principal balance of the regular interests in REMIC 2 as specified in the
Preliminary Statement hereto.
Closing
Date:
July 3,
2007.
Code:
The
Internal Revenue Code of 1986, including any successor or amendatory
provisions.
Collateral
Account:
The
account maintained by the Supplemental Interest Trust Trustee in accordance
with
the provisions of Section 4.06(b).
Collection
Account:
As
defined in Section 3.10(a).
Commission:
The
United States Securities and Exchange Commission.
Compensating
Interest:
For any
Distribution Date, the aggregate amount of the Servicing Fee actually retained
by or paid to the Servicer for such Distribution Date.
Condemnation
Proceeds:
All
awards or settlements in respect of a Mortgaged Property, whether permanent
or
temporary, partial or entire, by exercise of the power of eminent domain or
condemnation.
Corporate
Trust Office:
With
respect to the Securities Administrator, (i) for transfer, presentation or
surrender of Certificates, the office at ▇▇▇▇▇ Fargo Center, ▇▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇
▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇, Attention: Corporate Trust
Services -HASCO 2007-WF1, and (ii) for all other purposes, ▇▇▇▇ ▇▇▇ ▇▇▇▇▇▇▇▇▇
▇▇▇▇, ▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇ ▇▇▇▇▇, Attention: Client Manager - HASCO 2007-WF1
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
and
the Trustee. With respect to the Trustee, the designated office of the Trustee
in the State of California at which any particular time its corporate trust
business with respect to this Agreement is administered, which office at the
date of the execution of this Agreement is located at ▇▇▇▇ ▇▇▇▇ ▇▇. ▇▇▇▇▇▇
▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇, ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇-▇▇▇▇, Attention: Trust Administration -
HB07F1, facsimile number (▇▇▇) ▇▇▇-▇▇▇▇, and its telephone number is (▇▇▇)
▇▇▇-▇▇▇▇ and which is also the address to which notices to and correspondence
with the Trustee under this Agreement should be directed.
Corresponding
Class:
As
described in the Preliminary Statement.
Credit
Enhancement Percentage:
With
respect to any Distribution Date, the percentage obtained by dividing
(x) the sum of (i) the aggregate Class Certificate Balance of the
Class M Certificates and (ii) the Overcollateralization Amount
(assuming the Overcollateralization Amount is not less than zero and in each
case after taking into account the distributions of principal for such
Distribution Date assuming no Trigger Event has occurred) by (y) the
aggregate Stated Principal Balance of the Mortgage Loans for such Distribution
Date.
-19-
Credit
Risk Manager:
OfficeTiger Global Real Estate Services Inc., and its successors and assigns.
Credit
Risk Management Agreement:
Each of
the loan performance management agreements, dated as of the Closing Date,
entered into by (i) ▇▇▇▇▇ Fargo Bank, N.A., as Servicer and the Credit Risk
Manager, and (ii) the Master Servicer and the Credit Risk Manager.
Credit
Risk Manager’s Fee:
With
respect to any Distribution Date and each Mortgage Loan, an amount equal to
the
product of (a) one twelfth, (b) the Credit Risk Manager’s Fee Rate and (c) the
Stated Principal Balance of such Mortgage Loan as of the first day of the
related Due Period; provided, however, that such amount shall not be less than
$1,500.00 on each Distribution Date.
Credit
Risk Manager’s Fee Rate:
0.014%
per
annum.
Credit
Support Annex:
The
credit support annex to the Swap Agreement and the Cap Agreement dated as of
July 3, 2007, between the Supplemental Interest Trust Trustee, on behalf of
the
Supplemental Interest Trust, the Swap Counterparty and Cap
Counterparty.
Cumulative
Loss Percentage:
With
respect to any Distribution Date, the percentage equivalent of a fraction,
the
numerator of which is the aggregate amount of Realized Losses incurred from
the
Cut-off Date to the last day of the calendar month preceding the month in which
such Distribution Date occurs and the denominator of which is the Cut-off Date
Pool Principal Balance of the Mortgage Loans.
Cumulative
Loss Trigger Event:
If,
with respect to any Distribution Date, the quotient (expressed as a
percentage) of (x) the aggregate amount of Realized Losses incurred since
the Cut-off Date through the last day of the related Prepayment Period, divided
by (y) the Cut-off Date Pool Principal Balance, exceeds the applicable loss
percentages set forth below with respect to such Distribution Date:
-20-
|
Distribution
Date Occurring In:
|
Loss
Percentage:
|
|||
|
July
2009 through June 2010
|
1.05%
for the first month, plus an additional 1/12th of
1.30%
for each month thereafter
|
|||
|
July
2010 through June 2011
|
2.35%
for the first month, plus an additional 1/12th of
1.35%
for each month thereafter
|
|||
|
July
2011 through June 2012
|
3.70%
for the first month, plus an additional 1/12th of
1.10%
for each month thereafter
|
|||
|
July
2012 through June 2013
|
4.80%
for the first month, plus an additional 1/12th of
0.65%
for each month thereafter
|
|||
|
July
2013 through June 2014
|
5.45%
for the first month, plus an additional 1/12th of
0.05%
for each month thereafter
|
|||
|
July
2014 and thereafter
|
5.50%
|
|||
Custodial
File:
The
meaning assigned to such term in Section 2.01(a).
Custodian:
Initially, ▇▇▇▇▇ Fargo, or any successor custodian appointed
hereunder.
Cut-off
Date:
June 1,
2007.
Cut-off
Date Pool Principal Balance:
The
aggregate Stated Principal Balances of all Mortgage Loans as of the Cut-off
Date.
Cut-off
Date Principal Balance:
As to
any Mortgage Loan, the Stated Principal Balance thereof as of the close of
business on the Cut-off Date.
Data
Tape Information:
With
respect to each Mortgage Loan, the same information (provided as of the Cut-off
Date) included in the data fields specified under the definition of “Mortgage
Loan Schedule” in the Seller’s Warranties and Servicing Agreement, with such
additions and modifications as agreed upon by the Originator and the Depositor.
A copy of the Seller’s Warranties and Servicing Agreement is attached as Exhibit
Q hereto.
Debt
Service Reduction:
With
respect to any Mortgage Loan, a reduction by a court of competent jurisdiction
in a proceeding under the United States Bankruptcy Code in the Scheduled Payment
for such Mortgage Loan which became final and non-appealable, except such a
reduction resulting from a Deficient Valuation or any reduction that results
in
a permanent forgiveness of principal.
Defaulting
Party:
As
defined in the Swap Agreement or Cap Agreement, as applicable.
Deficient
Valuation:
With
respect to any Mortgage Loan, a valuation of the related Mortgaged Property
by a
court of competent jurisdiction in an amount less than then outstanding
principal balance of the Mortgage Loan, which valuation results from a
proceeding initiated under the United States Bankruptcy Code.
-21-
Definitive
Certificates:
Any
Certificate evidenced by a Physical Certificate and any Certificate issued
in
lieu of a Book-Entry Certificate pursuant to Section 5.02(e).
Deleted
Mortgage Loan:
As
defined in Section 2.03.
Delinquency
Rate:
For any
calendar month, a fraction, expressed as a percentage, the numerator of which
is
the aggregate Stated Principal Balance of 60+ Day Delinquent Mortgage Loans
(including Mortgage Loans that have been modified within the last 12 months)
as
of the close of business on the last day of such month (not including those
Mortgage Loans that are liquidated as of the end of the related Prepayment
Period), and the denominator of which is the aggregate Stated Principal Balance
of the Mortgage Loans as of the close of business on the last day of such month
(not including those Mortgage Loans that are liquidated as of the end of the
related Prepayment Period).
Delinquency
Trigger Event:
With
respect to any Distribution Date on or after the Stepdown Date, the
circumstances in which the Rolling Three Month Delinquency Rate as of the last
day of the immediately preceding calendar month exceeds the applicable
percentages of the Credit Enhancement Percentage for the prior Distribution
Date
(for the purpose of this definition, the Credit Enhancement Percentage for
each
class of the Class M Certificates will be calculated by dividing (x) the sum
of
(i) the aggregate Class Certificate Balance of the Class M Certificates with
a
lower payment priority than that Class and (ii) the Overcollateralization Amount
(in each case after taking into account distributions of principal for that
Distribution Date) by (y) the aggregate Stated Principal Balance of the Mortgage
Loans for that Distribution Date) as
set
forth below for the most senior Class of LIBOR Certificates then
outstanding:
|
Class
|
Percentage
|
|
A
|
42.37%
|
|
M-1
|
55.92%
|
|
M-2
|
76.74%
|
|
M-3
|
85.95%
|
|
M-4
|
99.61%
|
|
M-5
|
118.44%
|
|
M-6
|
131.94%
|
|
M-7
|
163.49%
|
|
M-8
|
197.91%
|
|
M-9
|
268.60%
|
|
M-10
|
470.04%
|
Denomination:
With
respect to each Certificate, the amount set forth on the face thereof as the
“Initial Certificate Balance of this Certificate” or the Percentage Interest
appearing on the face thereof.
Depositor:
HSI
Asset Securitization Corporation, a Delaware corporation, and its successors
in
interest.
-22-
Depository:
The
initial Depository shall be The Depository Trust Company, the nominee of which
is CEDE & Co., as the registered Holder of the Book-Entry Certificates.
The Depository shall at all times be a “clearing corporation” as defined in
Section 8-102(a)(5) of the Uniform Commercial Code of the State of New
York.
Depository
Institution:
Any
depository institution or trust company, including the Trustee and the
Securities Administrator, that (a) is incorporated under the laws of the
United States of America or any State thereof, (b) is subject to
supervision and examination by federal or state banking authorities and
(c) has outstanding unsecured commercial paper or other short-term
unsecured debt obligations that are rated P-1 by Moody’s, F1+ by Fitch and A-1
by Standard & Poor’s.
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.
Derivative
Agreement:
The
Swap Agreement and the Cap Agreement.
Derivative
Counterparty:
Collectively, the Cap Counterparty and the Swap Counterparty.
Derivative
Payment Date:
For so
long as either the Cap Agreement or the Swap Agreement is in effect, the
Business Day preceding each Distribution Date.
Determination
Date:
With
respect to each Remittance Date, the Business Day immediately preceding such
Remittance Date.
Disqualified
Non-U.S. Person:
With
respect to a Class R Certificate, any Non-U.S. Person or agent thereof
other than (i) a Non-U.S. Person that holds the Class R Certificate in
connection with the conduct of a trade or business within the United States
and
has furnished the transferor and the Securities Administrator with an effective
IRS Form W-8ECI or (ii) a Non-U.S. Person that has delivered to both the
transferor and the Securities Administrator an opinion of a nationally
recognized tax counsel to the effect that the transfer of the Class R
Certificate to it is in accordance with the requirements of the Code and the
regulations promulgated thereunder and that such transfer of the Class R
Certificate will not be disregarded for federal income tax
purposes.
Distribution
Account:
The
separate Eligible Account created and maintained by the Securities Administrator
pursuant to Section 3.07(d) in the name of the Securities Administrator as
paying agent for the benefit of the Trustee and the Certificateholders and
designated “▇▇▇▇▇ Fargo Bank, N.A. as securities administrator in trust for
registered holders of HSI Asset Securitization Corporation Trust 2007-WF1
Mortgage Pass-Through Certificates, Series 2007-WF1”. Funds in the
Distribution Account shall be held in trust for the Certificateholders for
the
uses and purposes set forth in this Agreement.
Distribution
Account Deposit Date:
As to
any Distribution Date, 12:00 noon New York City time on the third Business
Day
immediately preceding such Distribution Date.
-23-
Distribution
Date:
The
25th day of each calendar month, or if such day is not a Business Day, the
next
succeeding Business Day, commencing in July 2007.
Document
Certification and Exception Report:
The
form of report attached to Exhibit F hereto.
Due
Date:
The day
of the month on which the Scheduled Payment is due on a Mortgage Loan, exclusive
of any days of grace.
Due
Period:
With
respect to any Distribution Date, the period commencing on the second day of
the
calendar month preceding the month in which such Distribution Date occurs and
ending on the first day of the calendar month in which such Distribution Date
occurs.
▇▇▇▇▇:
The
Commission’s Electronic Data Gathering and Retrieval System.
Eligible
Account:
Either
(i) an account maintained with a federal or state-chartered depository
institution or trust company that complies with the definition of Eligible
Institution, (ii) an account maintained with the corporate trust department
of a
federal depository institution or state-chartered depository institution subject
to regulations regarding fiduciary funds on deposit similar to Title 12 of
the
U.S. Code of Federal Regulation Section 9.10(b), which, in either case, has
corporate trust powers and is acting in its fiduciary capacity or (iii) any
other account acceptable to each Rating Agency; provided,
however,
that if
any account maintained pursuant to this Agreement no longer complies with this
definition of Eligible Account, then such account shall promptly (and in any
case within 30 calendar days) be transferred to an Eligible Account. Eligible
Accounts may bear interest, and may include, if otherwise qualified under this
definition, accounts maintained with the Securities Administrator.
Eligible
Institution:
A
federal or state-chartered depository institution or trust company the
commercial paper, short-term debt obligations, or other short-term deposits
of
which are rated at least “A-1+” by Standard & Poor’s if the amounts on
deposit are to be held in the account for no more than 365 days (or at least
“A-2” if the amounts on deposit are to be held in the account for no more than
30 days), “P-1” by Moody’s and “F1+” by Fitch (or a comparable rating if another
Rating Agency is specified by the Depositor by written notice to each of the
Servicer and the Securities Administrator) or long-term unsecured debt
obligations are rated at least “AA-” by Standard & Poor’s if the amounts on
deposit are to be held in the account for no more than 365 days. Upon the loss
of a required rating, the amounts shall be transferred immediately (and in
any
case within 30 calendar days) to accounts which have a required
rating.
ERISA:
The
Employee Retirement Income Security Act of 1974, as amended.
ERISA-Qualifying
Underwriting:
A best
efforts or firm commitment underwriting or private placement that meets the
requirements of Prohibited Transaction Exemption (“PTE”) 96-84,
61 Fed. Reg. 58234 (1996), as amended by ▇▇▇ ▇▇-▇▇, ▇▇ ▇▇▇. ▇▇▇. ▇▇▇▇▇
(1997), PTE 2000-58, 65 Fed. Reg. 67765 (2000) and PTE 2002-41, 67 Fed.
Reg. 54487 (2002) (or any successor thereto), or any substantially
similar administrative exemption granted by the U.S. Department of
Labor.
-24-
ERISA-Restricted
Certificate:
As
specified in the Preliminary Statement.
ERISA-Restricted
Trust Certificate:
As
specified in the Preliminary Statement.
Escrow
Account:
The
Eligible Account or Accounts established and maintained by the Servicer pursuant
to Section 3.09.
Escrow
Payments:
As
defined in Section 3.09.
Event
of Default:
As
defined in Section 7.01.
Excess
Overcollateralization
Amount:
With
respect to any Distribution Date, the excess, if any, of (a) the
Overcollateralization Amount (for purposes of this calculation only, assuming
100% of the Principal Remittance Amount is applied as a principal payment to
the
LIBOR Certificates on such Distribution Date, but before giving effect to any
other distributions on the LIBOR Certificates in reduction of their respective
Class Certificate Balances on such Distribution Date) on such Distribution
Date
over (b) the Overcollateralization Target Amount for such Distribution
Date.
Excess
Reserve Fund Account:
The
separate Eligible Account created and maintained by the Securities Administrator
under the Supplemental Interest Trust pursuant to Sections 3.07(b) and
3.07(c) in the name of the Securities Administrator as paying agent for the
benefit of the LIBOR Certificateholders and the Class X Certificateholders
and
designated “▇▇▇▇▇ Fargo Bank, N.A. as paying agent in trust for registered
holders of HSI Asset Securitization Corporation Trust 2007-WF1, Mortgage
Pass-Through Certificates, Series 2007-WF1”. Funds in the Excess Reserve
Fund Account shall be held in trust for such Certificateholders for the uses
and
purposes set forth in this Agreement. Amounts on deposit in the Excess Reserve
Fund Account shall not be invested. The Excess Reserve Fund Account shall be
considered part of the Supplemental Interest Trust but not part of any
REMIC.
Exchange
Act:
The
Securities Exchange Act of 1934, as amended, and the rules and regulations
thereunder.
Excluded
Trust Assets:
As
defined in the Preliminary Statement.
Expense
Adjusted Mortgage Rate:
With
respect to any Distribution Date and as to each Mortgage Loan, the per annum
rate equal to the Mortgage Rate as of the first day of the related Due Period
less the Expense Fee Rate.
Expense
Fees:
As to
each Mortgage Loan and any Distribution Date, the Servicing Fee.
Expense
Fee Rate:
As to
each Mortgage Loan, a per annum rate equal to the Servicing Fee
Rate.
Extra
Principal Payment Amount:
As of
any Distribution Date, the lesser of (x) the related Total Monthly Excess
Spread for such Distribution Date and (y) the related Overcollateralization
Deficiency for such Distribution Date.
-25-
▇▇▇▇▇▇
Mae:
The
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 Originator or the Sponsor as
contemplated by this Agreement or the Purchase Agreement, as applicable), a
determination made by the Servicer that all Insurance Proceeds, Condemnation
Proceeds, Liquidation Proceeds and other payments or recoveries which the
Servicer, in its reasonable good faith judgment, expects to be finally
recoverable in respect thereof have been so recovered. The Servicer shall
maintain records, prepared by a Servicing Officer, of each Final Recovery
Determination made thereby.
Final
Scheduled Distribution Date:
The
Final Scheduled Distribution Date for each Class of Certificates is the
Distribution Date occurring in May 2037.
Fitch:
Fitch,
Inc., or any successor thereto. If Fitch is designated as a Rating Agency in
the
Preliminary Statement, for purposes of Section 12.05(c) the address for
notices to Fitch shall be Fitch, Inc., ▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇, ▇▇▇ ▇▇▇▇, ▇▇▇
▇▇▇▇ ▇▇▇▇▇, Attention: MBS Monitoring - HASCO (HSI Asset Securitization
Corporation Trust 2007-WF1), or such other address as Fitch may hereafter
furnish to the Depositor and the Securities Administrator.
Fixed
Rate Mortgage Loan:
A
Mortgage Loan with respect to which the Mortgage Rate set forth in the Mortgage
Note is fixed for the term of such Mortgage Loan.
Form
8-K Disclosure Information:
As
defined in Section 8.12(a)(iii).
▇▇▇▇▇▇▇
Mac:
The
Federal Home Loan Mortgage Corporation, a corporate instrumentality of the
United States created and existing under Title III of the Emergency Home
Finance Act of 1970, as amended, or any successor thereto.
Gross
Margin:
With
respect to each Adjustable Rate Mortgage Loan, the fixed percentage amount
set
forth in the related Mortgage Note to be added to the Index to determine the
Mortgage Rate.
Group I
Available Funds Cap:
With
respect to the Group I Mortgage Loans as of any Distribution Date, the per
annum
rate (subject to adjustment based on the actual number of days elapsed in the
related Interest Accrual Period) equal to (x) the weighted average of the
Expense Adjusted Mortgage Rate for each Group I Mortgage Loan then in effect
at
the beginning of the related Due Period (not including for this purpose any
Group I Mortgage Loans for which Principal Prepayments in Full have been
received and distributed in the month prior to that Distribution Date)
minus
(y) a
percentage equal to the product of (i) a fraction, the numerator of which is
equal to the portion of the Net Derivative Payment or Swap Termination Payment
(other than a Swap Termination Payment resulting
from a Derivative Counterparty Trigger Event)
made to
the Swap Counterparty with respect to such Due Period allocated to the Group
I
Mortgage Loans based on the applicable Group Percentage, and the denominator
of
which is equal to the aggregate Stated Principal Balance of the Group I Mortgage
Loans as of the beginning of the related Due Period and (ii)
12.
-26-
Group I
Certificates:
As
specified in the Preliminary Statement.
Group I
Mortgage Loans:
The
Mortgage Loans identified on the Mortgage Loan Schedule as Group I Mortgage
Loans.
Group I
Principal Payment Amount:
With
respect to any Distribution Date prior to the Stepdown Date, the Principal
Payment Amount multiplied by the Group Principal Allocation Percentage for
the Group I Certificates.
Group I
Senior Principal Payment Amount:
With
respect to any Distribution Date, the lesser of (i) the Group I Principal
Payment Amount for that Distribution Date and (ii) the excess of (a) the
aggregate Class Certificate Balance of the Group I Certificates
immediately prior to that Distribution Date over (b) the lesser of
(x) 63.80% of the aggregate Stated Principal Balance of the Group I
Mortgage Loans for that Distribution Date and (y) the excess, if any, of
the aggregate Stated Principal Balance of the Group I Mortgage Loans for
that Distribution Date over 0.50% of the aggregate State Principal Balance
of
the Group I Mortgage Loans as of the Cut-off Date.
Group II
Available Funds Cap:
With
respect to the Group II Mortgage Loans as of any Distribution Date, the per
annum rate (subject to adjustment based on the actual number of days elapsed
in
the related Interest Accrual Period) equal to (x) the weighted average of the
Expense Adjusted Mortgage Rate for each Group II Mortgage Loan then in effect
at
the beginning of the related Due Period (not including for this purpose any
Group II Mortgage Loans for which Principal Prepayments in Full have been
received and distributed in the month prior to that Distribution Date)
minus
(y) a
percentage equal to the product of (i) a fraction, the numerator of which is
equal to the portion of the Net Derivative Payment or Swap Termination Payment
(other than a Swap Termination Payment resulting from a Derivative Counterparty
Trigger Event) made to the Swap Counterparty with respect to such Due Period
allocated to the Group II Mortgage Loans based on the applicable Group
Percentage, and the denominator of which is equal to the aggregate Stated
Principal Balance of the Group II Mortgage Loans as of the beginning of the
related Due Period and (ii) 12.
Group II
Certificates:
As
specified in the Preliminary Statement.
Group II
Mortgage Loans:
The
Mortgage Loans identified on the Mortgage Loan Schedule as Group II
Mortgage Loans.
Group II
Principal Payment Amount:
With
respect to any Distribution Date, the Principal Payment Amount multiplied by
the
Group Principal Allocation Percentage for the Group II
Certificates.
Group II
Senior Principal Payment Amount:
With
respect to any Distribution Date, the lesser of (i) the Group II Principal
Payment Amount for that Distribution Date and (ii) the excess of (a) the
aggregate Class Certificate Balance of the Group II Certificates
immediately prior to that Distribution Date over (b) the lesser of
(x) 63.80% of the aggregate Stated Principal Balance of the Group II
Mortgage Loans for that Distribution Date and (y) the excess, if any, of
the aggregate Stated Principal Balance of the Group II Mortgage Loans for
that Distribution Date over 0.50% of the aggregate State Principal Balance
of
the Group II Mortgage Loans as of the Cut-off Date.
-27-
Group Available
Funds Cap:
The
Group I Available Funds Cap or the Group II Available Funds Cap, as
applicable.
Group
Percentage: For
any
Distribution Date and for each of the Group I Mortgage Loans and the
Group II Mortgage Loans, a fraction (expressed as a percentage) the
numerator of which is the aggregate Stated Principal Balance of the Mortgage
Loans in such Loan Group as of the beginning of the related Due Period and
the
denominator of which is equal to the aggregate Stated Principal Balance of
all
the Mortgage Loans as of such date.
Group Principal
Allocation Percentage:
With
respect to any Distribution Date, the percentage equivalent of a fraction,
determined as follows:
(i) with
respect to the Group I Certificates, a fraction, the numerator of which is
the portion of the Principal Remittance Amount for that Distribution Date that
is attributable to the principal received or advanced on the Group I
Mortgage Loans and the denominator of which is the Principal Remittance Amount
for that Distribution Date; and
(ii) with
respect to the Group II Certificates, a fraction, the numerator of
which is the portion of the Principal Remittance Amount for that Distribution
Date that is attributable to the principal received or advanced on the
Group II Mortgage Loans and the denominator of which is the Principal
Remittance Amount for that Distribution Date.
Group Subordinate
Amount:
For any
Distribution Date and (i) for the Group I Mortgage Loans, the excess
of the aggregate Stated Principal Balance of the Group I Mortgage Loans as
of the beginning of the related Due Period over the Class Certificate
Balance of the Group I Certificates immediately prior to such Distribution
Date
and (ii) for the Group II Mortgage Loans, the excess of the aggregate
Stated Principal Balance of the Group II Mortgage Loans as of the beginning
of the related Due Period over the aggregate Class Certificate Balance of
the Group II Certificates immediately prior to the current Distribution
Date.
Independent:
When
used with respect to any accountants, a Person who is “independent” within the
meaning of Rule 2-01(B) of the 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, trustee, 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.
-28-
Index:
As to
each Adjustable Rate Mortgage Loan, the six-month LIBOR index or one-year CMT
index, as applicable, from time to time in effect for the adjustment of the
Mortgage Rate as set forth in the related Mortgage Note.
Initial
Certification:
As
defined in Section 2.02.
Initial
Sale Date:
The
date the Mortgage Loan was purchased by the Sponsor from the Originator under
the Seller’s Warranties and Servicing Agreement.
Insurance
Policy:
With
respect to any Mortgage Loan included in the Trust Fund, any insurance policy,
including, but not limited to, any standard hazard insurance policy, flood
insurance policy, earthquake insurance policy, title insurance policy or Primary
Mortgage Insurance Policy (if any), including all riders and endorsements
thereto in effect, including any replacement policy or policies.
Insurance
Proceeds:
With
respect to each Mortgage Loan, proceeds of Insurance Policies insuring the
Mortgage Loan or the related Mortgaged Property.
Interest
Accrual Period:
With
respect to each Class of LIBOR Certificates and any Distribution Date, the
period commencing on the Distribution Date occurring in the month preceding
the
month in which the current Distribution Date occurs and ending on the day
immediately preceding the current Distribution Date (or, in the case of the
first Distribution Date, the period from and including the Closing Date to
but
excluding such first Distribution Date). For purposes of computing interest
accruals on each Class of LIBOR Certificates, each Interest Accrual Period
has the actual number of days in such month and each year is assumed to have
360 days. With respect to each Class of Lower Tier Interests and any
Distribution Date, the calendar month immediately preceding the month in which
such Distribution Date occurs.
Interest
Carry Forward Amount:
As of
any Distribution Date and any Class of LIBOR Certificates, the sum, if
applicable, of (i) the portion of the Interest Payment Amount from Distribution
Dates prior to the current Distribution Date remaining unpaid immediately prior
to the current Distribution Date (excluding any Basis Risk Carryover Amount
with
respect to such Class), and (ii) interest on the amount in clause (i) above
at
the applicable Interest Rate (to the extent permitted by applicable
law).
Interest
Margin:
Except
as set forth in the following sentence, with respect to each Class of LIBOR
Certificates, the following percentages: Class I-A Certificates, 0.160%;
Class II-A-1 Certificates, 0.060%; Class II-A-2 Certificates, 0.130%;
Class II-A-3 Certificates, 0.170%; Class II-A-4 Certificates, 0.250%;
Class M-1 Certificates, 0.250%; Class M-2 Certificates, 0.270%;
Class M-3 Certificates, 0.300%; Class M-4 Certificates, 0.360%;
Class M-5 Certificates, 0.420%; Class M-6 Certificates, 0.700%,
Class M-7 Certificates, 1.580%, Class M-8 Certificates, 2.000%,
Class M-9 Certificates, 2.000% and Class M-10 Certificates, 2.000%. On the
first Distribution Date after the Optional Termination Date, the Interest
Margins shall increase to the following percentages: Class I-A
Certificates, 0.320%; Class II-A-1 Certificates, 0.120%; Class II-A-2
Certificates, 0.260%; Class II-A-3 Certificates, 0.340%; Class II-A-4
Certificates, 0.500%; Class M-1 Certificates, 0.375%; Class M-2
Certificates, 0.405%; Class M-3 Certificates, 0.450%; Class M-4
Certificates, 0.540%; Class M-5 Certificates, 0.630%; Class M-6
Certificates, 1.050%, Class M-7 Certificates, 2.370%, Class M-8
Certificates, 3.000%, Class M-9 Certificates, 3.000% and Class M-10
Certificates, 3.000%.
-29-
Interest
Payment Amount:
With
respect to any Distribution Date for each Class of LIBOR Certificates, the
amount of interest accrued during the related Interest Accrual Period at the
applicable Interest Rate on the related Class Certificate Balance
immediately prior to such Distribution Date, as reduced by such Class’s share of
Net Prepayment Interest Shortfalls and Relief Act Interest Shortfalls for such
Distribution Date allocated to such Class pursuant to
Section 4.02.
Interest
Rate:
For
each Class of LIBOR Certificates, each Class of Upper Tier REMIC Regular
Interest and each class of Lower Tier Interest, the per annum rate set forth
or
calculated in the manner described in the Preliminary Statement.
Interest
Remittance Amount:
With
respect to any Distribution Date and the Mortgage Loans in a Loan Group, that
portion of Available Funds attributable to interest relating to the Mortgage
Loans in that Loan Group.
Investment
Account:
As
defined in Section 3.12(a).
Investor:
With
respect to each MERS Designated Mortgage Loan, the Person named on the MERS
System as the investor pursuant to the MERS Procedures Manual.
IRS:
The
Internal Revenue Service.
Late
Collections:
With
respect to any Mortgage Loan and any Due Period, all amounts received after
the
Determination Date immediately following such Due Period, whether as late
payments of Scheduled Payments or as Insurance Proceeds, Condemnation Proceeds,
Liquidation Proceeds, Subsequent Recoveries or otherwise, which represent late
payments or collections of principal and/or interest due (without regard to
any
acceleration of payments under the related Mortgage and Mortgage Note) but
delinquent for such Due Period and not previously recovered.
LIBOR:
With
respect to any Interest Accrual Period for the LIBOR Certificates, the rate
determined by the Securities Administrator on the related LIBOR Determination
Date on the basis of the offered rate for one-month U.S. dollar deposits as
such
rate appears on Reuters screen “LIBOR01” as of 11:00 a.m. (London time) on
such date; provided,
that if
such rate does not appear on Reuters screen “LIBOR01”, the rate for such date
will be determined on the basis of the rates at which one-month U.S. dollar
deposits are offered by the Reference Banks at approximately 11:00 a.m.
(London time) on such date to prime banks in the London interbank market. In
such event, the Securities Administrator shall request the principal London
office of each of the Reference Banks to provide a quotation of its rate. If
at
least two such quotations are provided, the rate for that date will be the
arithmetic mean of the quotations (rounded upwards if necessary to the nearest
whole multiple of 1/16%). If fewer than two quotations are provided as
requested, the rate for that date will be the arithmetic mean of the rates
quoted by major banks in New York City, selected by the Securities Administrator
(after consultation with the Depositor), at approximately 11:00 a.m. (New
York City time) on such date for one-month U.S. dollar loans to leading European
banks.
-30-
LIBOR
Certificates:
As
specified in the Preliminary Statement.
LIBOR
Determination Date:
With
respect to any Interest Accrual Period for the LIBOR Certificates, the second
London Business Day preceding the commencement of such Interest Accrual
Period.
Liquidated
Mortgage Loan:
With
respect to any Distribution Date, a defaulted Mortgage Loan (including any
REO
Property) which was liquidated in the calendar month preceding the month of
such
Distribution Date and as to which the Servicer has certified to the Securities
Administrator that it has received all amounts it expects to receive in
connection with the liquidation of such Mortgage Loan including the final
disposition of an REO Property.
Liquidation
Proceeds:
Cash
received in connection with the liquidation of a Liquidated Mortgage Loan,
whether through a trustee’s sale, foreclosure sale or otherwise.
Loan
Group: The Group I Mortgage Loans or the Group II Mortgage Loans, as
applicable.
Loan-to-Value
Ratio
or
LTV:
As of
any date and as to any Mortgage Loan, the ratio (expressed as a
percentage) of the outstanding principal balance of the Mortgage Loan to
(a) in the case of a purchase, the lesser of (i) the sale price of the
Mortgaged Property and (ii) its appraised value at the time of sale or
(b) in the case of a refinancing or modification, the appraised value of
the Mortgaged Property at the time of the refinancing or
modification.
London
Business Day:
Any day
on which dealings in deposits of United States dollars are transacted in the
London interbank market.
Lower
Tier Interest:
An
interest in any REMIC formed hereby other than the Upper Tier
REMIC.
Master
Agreement:
The
ISDA Master Agreement, dated July 3, 2007, entered into between the Supplemental
Interest Trust Trustee, on behalf of the Supplemental Interest Trust and the
Derivative Counterparty.
Master
Servicer:
▇▇▇▇▇
Fargo and any successor in interest, and if a successor master servicer is
appointed hereunder, such successor.
Master
Servicer Event of Default:
As
defined in Section 9.06.
Master
Servicing Officer:
Any
officer of the Master Servicer involved in, or responsible for, the
administration and master servicing of the Mortgage Loans.
MERS:
Mortgage Electronic Registration Systems, Inc., a Delaware corporation, and
its
successors in interest.
MERS
Designated Mortgage Loan:
Any
Mortgage Loan as to which the related Mortgage, or an Assignment of Mortgage,
has been or will be recorded in the name of MERS, as nominee for the holder
from
time to time of the Mortgage Note.
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MERS
Procedure Manual:
The
MERS Procedures Manual, as it may be amended, supplemented or otherwise modified
from time to time.
MERS®
System:
MERS
mortgage electronic registry system, as more particularly described in the
MERS
Procedures Manual.
MIN:
The
Mortgage Identification Number of Mortgage Loans registered with MERS on the
MERS® System.
Monthly
Statement:
The
statement made available to the Certificateholders by the Securities
Administrator (through its website) pursuant to Section 4.03.
Moody’s:
▇▇▇▇▇’▇
Investors Service, Inc. If ▇▇▇▇▇’▇ is designated as a Rating Agency in the
Preliminary Statement, for purposes of Section 12.05 the address for
notices to Moody’s shall be ▇▇▇▇▇’▇ Investors Service, Inc., ▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇▇,
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇, Attention: Residential Mortgage Pass-Through Group,
HASCO (HSI Asset Securitization Corporation Trust Series 2007-WF1), or such
other address as Moody’s may hereafter furnish to the Depositor and the
Securities Administrator.
Mortgage:
The
mortgage, deed of trust or other instrument identified on the Mortgage Loan
Schedule as securing a Mortgage Note.
Mortgage
File:
The
items pertaining to a particular Mortgage Loan contained in either the Servicing
File or Custodial File.
Mortgage
Loan:
An
individual Mortgage Loan that is the subject of this Agreement, each Mortgage
Loan originally sold and subject to this Agreement being identified on the
Mortgage Loan Schedule, which Mortgage Loan includes, without limitation, the
Mortgage File, the Scheduled Payments, Principal Prepayments, Liquidation
Proceeds, Subsequent Recoveries, Condemnation Proceeds, Insurance Proceeds,
REO
Disposition proceeds, Prepayment Charges, 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 Schedule:
A
schedule of Mortgage Loans prepared by the Depositor, delivered to the Trustee
on the Closing Date and referred to in Exhibit Q, such schedule setting forth
the Data Tape Information with respect to each Mortgage Loan.
Mortgage
Note:
The
note or other evidence of the indebtedness of a Mortgagor under a Mortgage
Loan.
Mortgage
Rate:
The
annual rate of interest borne on a Mortgage Note, which shall be adjusted from
time to time.
Mortgaged
Property:
With
respect to each Mortgage Loan, the real property (or leasehold estate, if
applicable) identified on the Mortgage Loan Schedule as securing repayment
of
the debt evidenced by the related Mortgage Note.
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Mortgagor:
The
obligor(s) on a Mortgage Note.
Net
Derivative Payment:
The net
payment required to be made on the Derivative Payment Date either by (a) the
Supplemental Interest Trust to the Derivative Counterparty, to the extent that
the fixed amount payable by the Supplemental Interest Trust under the terms
of
the Swap Agreement exceeds the aggregate amount of the corresponding floating
amount payable by the Derivative Counterparty under the terms of the Swap
Agreement and any amounts payable by the Derivative Counterparty under the
Cap
Agreement, or (b) the Derivative Counterparty to the Supplemental Interest
Trust, to the extent that the aggregate amount of the floating amount payable
by
the Derivative Counterparty under the terms of the Swap Agreement and any such
amount payable by the Derivative Counterparty under the Cap Agreement exceeds
the corresponding fixed amount payable by the Supplemental Interest Trust under
the terms of the Swap Agreement, plus in the case of a payment made under either
clause (a) or clause (b) any unpaid amounts due under such clause from previous
Derivative Payment Dates, and accrued interest thereon as provided in the
applicable Derivative Agreement, as calculated by the Derivative Counterparty
and furnished to the Supplemental Interest Trust Trustee. Any Swap Termination
Payment or Cap Termination Payment will be made exclusive of the Net Derivative
Payment required to be made by the Derivative Counterparty or Supplemental
Interest Trust, as applicable, under the Swap Agreement or the Cap
Agreement.
Net
Monthly Excess Cash Flow:
For any
Distribution Date, the amount of interest and principal remaining for
distribution pursuant to subsection 4.02(a)(iii) (before giving effect to
distributions pursuant to such subsection).
Net
Prepayment Interest Shortfall:
For any
Distribution Date, the amount by which the sum of the Prepayment Interest
Shortfalls for such Distribution Date exceeds the sum of Compensating Interest
payments made with respect to such Distribution Date.
Net
Swap Payment:
With
respect to each Swap Payment Date, the net payment (not including any Swap
Termination Payment) required to be made pursuant to the terms of the Swap
Agreement plus any unpaid amounts due on previous Swap Payment Dates and accrued
interest thereon as provided in the Swap Agreement, as calculated by the Swap
Counterparty and furnished to the Securities Administrator.
Net
WAC Rate:
With
respect to any Distribution Date (and the related Interest Accrual Period),
a
per annum rate equal to the weighted average of the Expense Adjusted Mortgage
Rates of the Mortgage Loans as of the first day of the related Due Period (not
including for this purpose Mortgage Loans for which Principal Prepayments in
Full have been received and distributed in the month prior to that Distribution
Date).
NIM
Issuer:
The
entity established as the issuer of the NIM Securities.
NIM
Securities:
Any
debt securities secured or otherwise backed by some or all of the Class X
and Class P Certificates that are rated by any Rating Agency.
NIM
Trustee:
The
indenture trustee for the NIM Securities.
Non-Delay
Certificates:
As
specified in the Preliminary Statement.
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Non-Permitted
Transferee:
A
Person other than a Permitted Transferee.
Non-U.S.
Person:
A
person that is not a U.S. Person.
Nonrecoverable
P&I Advance:
Any
P&I Advance previously made or proposed to be made in respect of a Mortgage
Loan or REO Property that, in the good faith business judgment (taking into
account Accepted Servicing Practices) of the Servicer, the Master Servicer,
as
successor servicer, or any successor master servicer including the Trustee,
as
applicable, will not or, in the case of a proposed P&I Advance, would not be
ultimately recoverable from related Late Collections on such Mortgage Loan
or
REO Property as provided herein.
Nonrecoverable
Servicing Advance:
Any
Servicing Advances previously made or proposed to be made in respect of a
Mortgage Loan or REO Property, which, in accordance with Accepted Servicing
Practices, will not or, in the case of a proposed Servicing Advance, would
not
be ultimately recoverable from related Late Collections.
Notice
of Final Distribution:
The
notice to be provided by the Securities Administrator pursuant to
Section 11.02 to the effect that final distribution on any of the
Certificates shall be made only upon presentation and surrender
thereof.
Offered
Certificates:
As
specified in the Preliminary Statement.
Offering
Documents:
The
Prospectus and the Private Placement Memorandum.
Officer’s
Certificate:
A
certificate signed by an officer of the Servicer or the Master Servicer, as
applicable, with responsibility for the servicing of the Mortgage
Loans.
Opinion
of Counsel:
A
written opinion of counsel, which may be in-house or outside counsel to the
Servicer, the Subservicer, the Depositor, the Sponsor, the Master Servicer,
the
Securities Administrator or the Trustee, acceptable to the Trustee or the
Securities Administrator, as applicable (and/or such other Persons as may be
set
forth herein), except that any opinion of counsel relating to (a) the
qualification of any REMIC created hereunder as a REMIC or (b) compliance with
the REMIC Provisions must be an opinion of Independent counsel.
Option
to Purchase:
With
respect to any Optional Termination Date, the right of the Master Servicer
at
its own option to purchase the Mortgage Loans.
Optional
Termination Date:
Any
Distribution Date on which the aggregate Stated Principal Balance of the
Mortgage Loans, as of the last day of the related Due Period, is less than
or
equal to 10.00% of the Cut-off Date Pool Principal Balance.
Originator:
▇▇▇▇▇
Fargo and its successors in interest.
OTS:
Office
of Thrift Supervision, and any successor thereto.
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Outstanding:
With
respect to the Certificates as of any date of determination, all Certificates
theretofore executed and authenticated under this Agreement except:
(i) Certificates
theretofore canceled by the Securities Administrator or delivered to the
Securities Administrator for cancellation; and
(ii) 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 Due Date, a Mortgage Loan with a Stated Principal Balance greater than
zero
which was not the subject of a Principal Prepayment in Full prior to such Due
Date and which did not become a Liquidated Mortgage Loan prior to such Due
Date.
Overcollateralization
Amount:
As of
any Distribution Date, the excess, if any, of (a) the aggregate Stated
Principal Balance of the Mortgage Loans for such Distribution Date over
(b) the aggregate of the Class Certificate Balances of the LIBOR
Certificates as of such Distribution Date (after giving effect to all payments
of principal on such Certificates on such Distribution Date).
Overcollateralization
Deficiency:
With
respect to any Distribution Date, the excess, if any, of (a) the
Overcollateralization Target Amount applicable to such Distribution Date over
(b) the Overcollateralization Amount (for purposes of this calculation
only, assuming 100% of the Principal Remittance Amount is applied as a principal
payment to the LIBOR Certificates on such Distribution Date, but before giving
effect to any other distributions on the LIBOR Certificates in reduction of
their respective Class Certificate Balances on such Distribution Date)
applicable to such Distribution Date.
Overcollateralization
Reduction Amount:
With
respect to any Distribution Date, an amount equal to the lesser of (a) the
Excess Overcollateralization Amount and (b) the Net Monthly Excess Cash
Flow.
Overcollateralization
Target Amount:
Prior
to the Stepdown Date, an amount equal to 1.60% of the aggregate Stated Principal
Balance of the Mortgage Loans as of the Cut-off Date. On and after the Stepdown
Date, provided a Trigger Event is not in effect, an amount equal to the greater
of (i) 3.20% of the aggregate Stated Principal Balance of the Mortgage Loans
as
of the last day of the related Due Period and (ii) 0.50% of the aggregate Stated
Principal Balance of the Mortgage Loans as of the Cut-off Date; provided,
however,
that
if, on any Distribution Date a Trigger Event exists, the Overcollateralization
Target Amount shall not be reduced to the applicable percentage of then current
aggregate Stated Principal Balance of the Mortgage Loans until the Distribution
Date on which a Trigger Event no longer exists but rather shall remain the
Overcollateralization Target Amount as determined for the immediately preceding
Distribution Date. When the Class Certificate Balance of each Class of
LIBOR Certificates has been reduced to zero, the Overcollateralization Target
Amount will thereafter equal zero.
-35-
Ownership
Interest:
As to
any Residual Certificate, any ownership interest in such Certificate including
any interest in such Certificate as the Holder thereof and any other interest
therein, whether direct or indirect, legal or beneficial.
P&I
Advance:
As to
any Mortgage Loan or REO Property, any advance made by the Servicer in respect
of any Remittance Date representing the aggregate of all payments of principal
and interest, net of the Servicing Fee, that were due during the related Due
Period on the Mortgage Loans and that were delinquent on the related
Determination Date, plus certain amounts representing assumed payments not
covered by any current net income on the Mortgaged Properties acquired by
foreclosure or deed in lieu of foreclosure as determined pursuant to
Section 4.01.
Percentage
Interest:
As to
any Certificate, the percentage interest evidenced thereby in distributions
required to be made on the related Class, such percentage interest being set
forth on the face thereof or equal to the percentage obtained by dividing the
Denomination of such Certificate by the aggregate of the Denominations of all
Certificates of the same Class.
Permitted
Investments:
Any one
or more of the following obligations or securities acquired at a purchase price
of not greater than par, regardless of whether issued by the Servicer, the
Securities Administrator, the Trustee or any of their respective
Affiliates:
(i) direct
obligations of, or obligations fully guaranteed as to timely payment of
principal and interest by, the United States or any agency or instrumentality
thereof, provided such obligations are backed by the full faith and credit
of
the United States;
(ii) demand
and time deposits in, certificates of deposit of, or bankers’ acceptances (which
shall each have an original maturity of not more than 90 days and, in the
case of bankers’ acceptances, shall in no event have an original maturity of
more than 365 days or a remaining maturity of more than 30 days)
denominated in United States dollars and issued by, any Depository Institution
and rated F1+ by Fitch, A-1+ by Standard & Poor’s and P-1 by
Moody’s;
(iii) repurchase
obligations with respect to any security described in clause (i) above
entered into with a Depository Institution (acting as principal);
(iv) securities
bearing interest or sold at a discount that are issued by any corporation
incorporated under the laws of the United States of America or any state thereof
and that are rated by Fitch, Moody’s and Standard & Poor’s (in each case, to
the extent they are designated as Rating Agencies in the Preliminary Statement),
and by each other Rating Agency that rates such securities, in its highest
long-term unsecured rating categories at the time of such investment or
contractual commitment providing for such investment;
(v) commercial
paper (including both non-interest-bearing discount obligations and
interest-bearing obligations payable on demand or on a specified date not more
than 30 days after the date of acquisition thereof) that is rated by Fitch,
Moody’s and Standard & Poor’s (in each case, to the extent they are
designated as Rating Agencies in the Preliminary Statement), and by each other
Rating Agency that rates such securities, in its highest short-term unsecured
debt rating available at the time of such investment;
-36-
(vi) units
of
money market funds, including money market funds managed or advised by the
Trustee, the Securities Administrator or an Affiliate thereof, that have been
rated “Aaa” by Moody’s, “AAAm” by Standard & Poor’s and, if rated by
Fitch, “AAA” by Fitch; and
(vii) if
previously confirmed in writing to the Securities Administrator, any other
demand, money market or time deposit, or any other obligation, security or
investment, as may be acceptable to each of the Rating Agencies as a permitted
investment of funds backing “Aaa” or “AAA” rated securities;
provided,
however,
that no
instrument described hereunder shall evidence either the right to receive
(a) only interest with respect to the obligations underlying such
instrument or (b) both principal and interest payments derived from
obligations underlying such instrument and the interest and principal payments
with respect to such instrument provide a yield to maturity at par greater
than
120.00% of the yield to maturity at par of the underlying
obligations.
Permitted
Transferee:
Any
Person other than (i) the United States, any State or political subdivision
thereof, or any agency or instrumentality of any of the foregoing, (ii) a
foreign government, international organization or any agency or instrumentality
of either of the foregoing, (iii) an organization (except certain farmers’
cooperatives described in Section 521 of the Code) which is exempt from tax
imposed by Chapter 1 of the Code (including the tax imposed by Section 511
of the Code on unrelated business taxable income) on any excess inclusions
(as
defined in Section 860E(c)(1) of the Code) with respect to any Residual
Certificate, (iv) rural electric and telephone cooperatives described in
Section 1381(a)(2)(C) of the Code, (v) a Person that is a Disqualified
Non-U.S. Person or a U.S. Person with respect to whom income from a Residual
Certificate is attributable to a foreign permanent establishment or fixed base,
within the meaning of an applicable income tax treaty, of such Person or any
other U.S. Person, (vi) an “electing large partnership” within the meaning
of Section 775 of the Code and (vii) any other Person so designated by
the Depositor based upon an Opinion of Counsel that the Transfer of an Ownership
Interest in a Residual Certificate to such Person may cause any REMIC formed
hereby to fail to qualify as a REMIC at any time that the Certificates are
outstanding. The terms “United States”, “State” and “international organization”
shall have the meanings set forth in Section 7701 of the Code or successor
provisions. A corporation will not be treated as an instrumentality of the
United States or of any State or political subdivision thereof for these
purposes if all of its activities are subject to tax and, with the exception
of
▇▇▇▇▇▇▇ Mac, a majority of its board of directors is not selected by such
government unit.
Person:
Any
individual, corporation, partnership, joint venture, association, limited
liability company, joint-stock company, trust, unincorporated organization
or
government, or any agency or political subdivision thereof.
Physical
Certificates:
As
specified in the Preliminary Statement.
-37-
Pool
Stated Principal Balance:
As to
any Distribution Date, the aggregate of the Stated Principal Balances of the
Mortgage Loans for such Distribution Date that were Outstanding Mortgage Loans
on the Due Date in the related Due Period.
Prepayment
Charge:
Any
prepayment premium, penalty or charge collected by the Servicer with respect
to
a Mortgage Loan from a Mortgagor in connection with any Principal Prepayment
pursuant to the terms of the related Mortgage Note.
Prepayment
Interest Shortfall:
With
respect to any Distribution Date, the sum of, for each Mortgage Loan that was,
during the portion of the related Prepayment Period from the first day of such
Prepayment Period through the last day of the month preceding the month in
which
such Distribution Date occurs, the subject of a Principal Prepayment which
is
not accompanied by an amount equal to one month of interest that would have
been
due on such Mortgage Loan on the Due Date that occurs during such Prepayment
Period and which was applied by the Servicer to reduce the outstanding principal
balance of such Mortgage Loan on a date preceding such Due Date, an amount
equal
to the product of (a) the Mortgage Rate net of the Servicing Fee Rate for
such Mortgage Loan, (b) the amount of the Principal Prepayment for such
Mortgage Loan, (c) 1/360 and (d) the number of days commencing on the
date on which such Principal Prepayment was applied and ending on the last
day
of the calendar month in which the related Prepayment Period
begins.
Prepayment
Period:
With
respect to any Distribution Date and any Principal Prepayments, the calendar
month preceding the month in which such Distribution Date occurs.
Primary
Mortgage Insurance Policy:
Any
mortgage guaranty insurance, if any, on an individual Mortgage Loan as evidenced
by a policy or certificate, whether such policy is obtained by the Originator,
the lender or the borrower.
Principal
Payment Amount:
For any
Distribution Date, the sum of (i) the Basic Principal Payment Amount for
such Distribution Date and (ii) the Extra Principal Payment Amount for such
Distribution Date.
Principal
Prepayment:
Any
full or partial payment or other recovery of principal on a Mortgage Loan
(including upon liquidation of a Mortgage Loan) that is received in advance
of
its scheduled Due Date, excluding any Prepayment Charge thereon, and that is
not
accompanied by an amount of interest representing scheduled interest due on
any
date or dates in any month or months subsequent to the month of prepayment.
Principal
Prepayment in Full:
Any
Principal Prepayment made by a Mortgagor of the entire principal balance of
a
Mortgage Loan.
Principal
Remittance Amount:
With
respect to any Distribution Date, the amount equal to the sum of the following
amounts (without duplication) with respect to the related Due Period:
(i) each scheduled payment of principal on a Mortgage Loan due during such
Due Period and received by the Servicer on or prior to the related Determination
Date or advanced by the Servicer for the related Remittance Date, (ii) all
Principal Prepayments received during the related Prepayment Period;
(iii) all net Liquidation Proceeds, Condemnation Proceeds and Insurance
Proceeds on the Mortgage Loans allocable to principal, and all Subsequent
Recoveries, actually collected by the Servicer during the related Prepayment
Period; (iv) the portion of the Repurchase Price allocable to principal
with respect to each Mortgage Loan repurchased by the Originator or the Sponsor,
as the case may be, that was repurchased on or prior to the related
Determination Date; (v) all Substitution Adjustment Amounts allocable to
principal with respect to the substitutions of Mortgage Loans that occur on
or
prior to the related Determination Date; and (vi) the allocable portion of
the proceeds received with respect to the termination of the Trust Fund pursuant
to clause (a) of Section 11.01 (to the extent such proceeds
relate to principal).
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Private
Certificates:
As
specified in the Preliminary Statement.
Private
Placement Memorandum:
The
Private Placement Memorandum, dated July 2, 2007, relating to the offering
of
the Class M-10 Certificates.
Prospectus:
The
Prospectus, dated April 27, 2007, as supplemented by the Prospectus
Supplement.
Prospectus
Supplement:
The
Prospectus Supplement, dated July 2, 2007, relating to the Offered
Certificates.
PTCE:
As
defined in Section 5.02(b).
Purchase
Agreement:
The
Mortgage Loan Purchase Agreement, dated as of June 1, 2007, between the
Depositor and the Sponsor.
Rating
Agency:
Each of
the Rating Agencies specified in the Preliminary Statement. If such organization
or a successor is no longer in existence, “Rating Agency” shall be such
nationally recognized statistical rating organization, or other comparable
Person, as is designated by the Depositor, notice of which designation shall
be
given to the Trustee and the Securities Administrator. References herein to
a
given rating or rating category of a Rating Agency shall mean such rating
category without giving effect to any modifiers. For purposes of
Section 12.05, the addresses for notices to each Rating Agency shall be the
address specified therefor in the definition corresponding to the name of such
Rating Agency, or such other address as either such Rating Agency may hereafter
furnish to the Depositor and the Securities Administrator.
Realized
Losses:
With
respect to any date of determination and any Liquidated Mortgage Loan, the
amount, if any, by which (a) the unpaid principal balance of such
Liquidated Mortgage Loan together with accrued and unpaid interest thereon
exceeds (b) the Liquidation Proceeds with respect thereto net of the
expenses incurred by the Servicer in connection with the liquidation of such
Liquidated Mortgage Loan and net of the amount of unreimbursed Servicing
Advances with respect to such Liquidated Mortgage Loan.
Record
Date:
With
respect to any Distribution Date and any Certificate (other than a Certificate
issued in definitive form), the close of business on the Business Day
immediately preceding such Distribution Date; provided,
however,
that,
for any Certificate issued in definitive form, the Record Date shall be the
close of business on the last Business Day of the month preceding the month
in
which such applicable Distribution Date occurs (or, in the case of the first
Distribution Date, the Closing Date).
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Reference
Bank:
As
defined in Section 4.04.
Regulation
AB:
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, 1,631 (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.
Regulation
S:
Regulation S promulgated under the Securities Act or any successor provision
thereto, in each case as the same may be amended from time to time; and all
references to any rule, section or subsection of, or definition or term
contained in, Regulation S means such rule, section, subsection, definition
or
term, as the case may be, or any successor thereto, in each case as the same
may
be amended from time to time.
Regulation
S Investment Letter: As defined in Section 5.02(b).
Regular
Certificates:
As
specified in the Preliminary Statement.
Relevant
Servicing Criteria:
The
Servicing Criteria applicable to the parties having reporting obligations
hereunder, as set forth on Exhibit S attached hereto. For clarification
purposes, multiple parties can have responsibility for the same Relevant
Servicing Criteria. With respect to any Servicing Function Participant engaged
by the Master Servicer, the Securities Administrator, the Custodian or the
Servicer, the term “Relevant Servicing Criteria” may refer to a portion of the
Relevant Servicing Criteria applicable to such parties.
Relief
Act Interest Shortfall:
With
respect to any Distribution Date and any Mortgage Loan, any reduction in the
amount of interest collectible on such Mortgage Loan for the most recently
ended
Due Period as a result of the application of the Servicemembers Civil Relief
Act
or any applicable similar state statutes.
REMIC:
Each
pool of assets in the Trust Fund designated as a REMIC pursuant to the
Preliminary Statement.
REMIC
1:
As
described in the Preliminary Statement.
REMIC
2:
As
described in the Preliminary Statement.
REMIC
2 Net Funds Cap:
For any
Distribution Date (and the related Interest Accrual Period) and any Class of
Certificates, an amount equal to (i) the weighted average of the interest rates
on the Lower Tier Interests in REMIC 2 (other than any interest-only regular
interest), weighted in proportion to their Class Certificate Balances as of
the
beginning of the related Interest Accrual Period, multiplied, in the case of
a
LIBOR Certificate, by (ii) the quotient of (a) 30, divided by (b) the actual
number of days in the Interest Accrual Period.
REMIC
3:
As
described in the Preliminary Statement.
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REMIC
Provisions:
Provisions of the federal income tax law relating to real estate mortgage
investment conduits, which appear at Sections 860A through 860G of
Subchapter M of Chapter 1 of the Code, and related provisions, and regulations
promulgated thereunder, as the foregoing may be in effect from time to time
as
well as provisions of applicable state laws.
Remittance
Date:
With
respect to any Distribution Date, the 18th
day of
the month in which such Distribution Date occurs, or, if the 18th
is not a
Business Day, the immediately succeeding Business Day.
REO
Disposition:
The
final sale by the Servicer of any REO Property.
REO
Imputed Interest:
As to
any REO Property, for any period, an amount equivalent to interest (at the
Mortgage Rate net of the applicable Servicing Fee Rate that would have been
applicable to the related Mortgage Loan had it been outstanding) on the unpaid
principal balance of the Mortgage Loan as of the date of acquisition thereof
(as
such balance is reduced pursuant to Section 3.17 by any income from the REO
Property treated as a recovery of principal).
REO
Mortgage Loan:
A
Mortgage Loan where title to the related Mortgaged Property has been obtained
by
the Servicer in the name of the Trustee on behalf of the
Certificateholders.
REO
Property:
A
Mortgaged Property acquired by the Trust Fund through foreclosure or
deed-in-lieu of foreclosure in connection with a defaulted Mortgage
Loan.
Reportable
Event:
As
defined in Section 8.12(a)(iii).
Reporting
Servicer:
As
defined in Section 8.12(a)(ii).
Repurchase
Price:
With
respect to any Mortgage Loan, an amount equal to the sum of (i) the
Stated
Principal Balance
of such
Mortgage Loan as of the date of repurchase, (ii) interest on such Stated
Principal Balance of such Mortgage Loan at the Mortgage Rate, net, in the case
of repurchase by the Originator only, of the Servicing Fee Rate, from the last
date through which interest has been paid to the date of repurchase,
(iii) all unreimbursed Servicing Advances, (iv) the amount of any
costs and damages incurred by the Trust Fund as a result of any violation of
any
applicable federal, state or local predatory- or abusive-lending law arising
from or in connection with the origination of such Mortgage Loan and
(v) all expenses incurred by the Master Servicer, the Securities
Administrator, the Servicer or Trustee arising out of the Master Servicer’s, the
Servicer’s or Trustee’s enforcement of the Originator’s or Sponsor’s repurchase
obligation hereunder.
Request
for Release:
The
Request for Release submitted by the Servicer to the Trustee, substantially
in
the form of Exhibit J.
Residual
Certificates:
As
specified in the Preliminary Statement.
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Responsible
Officer:
When
used with respect to the Trustee, the Securities Administrator, the Master
Servicer, any vice president, any assistant vice president, any assistant
secretary, any assistant treasurer, any associate, or any other officer of
the
Trustee, the Securities Administrator or the Master Servicer customarily
performing functions similar to those performed by any of the above designated
officers who at such time shall be officers to whom, with respect to a
particular matter, such matter is referred because of such officer’s knowledge
of and familiarity with the particular subject and who, in each case, shall
have
direct responsibility for the administration of this Agreement.
Reuters
screen “LIBOR01:
The
display page currently so designated by the BBA (or such other page as may
replace that page on that service for displaying comparable rates or
prices) for the offered rates for U.S. dollar deposits of one month maturity,
as
such rates appear as of 11:00 a.m. (London time) on such LIBOR Determination
Date.
Rolling
Three Month Delinquency Rate:
With
respect to any Distribution Date, the average of the Delinquency Rates for
each
of the three (or one or two, in the case of the first and second Distribution
Dates) immediately preceding calendar months.
Rule 144A
Investment Letter:
As
defined in Section 5.02(b).
▇▇▇▇▇▇▇▇-▇▇▇▇▇
Act:
The
▇▇▇▇▇▇▇▇-▇▇▇▇▇ Act of 2002 and the rules and regulations of the Commission
promulgated thereunder (including any interpretations thereof by the
Commission’s staff).
▇▇▇▇▇▇▇▇-▇▇▇▇▇
Certification:
A
written certification signed by an officer of the Master Servicer that complies
with (i) the ▇▇▇▇▇▇▇▇-▇▇▇▇▇ Act, 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 ▇▇▇▇▇▇▇▇-▇▇▇▇▇ Act 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 ▇▇▇▇▇▇▇▇-▇▇▇▇▇ Act, 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 that then form of the required certification as of
the
Closing Date, the ▇▇▇▇▇▇▇▇-▇▇▇▇▇ Certification shall be as agreed to by the
Master Servicer and the Depositor 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 which, unless otherwise
specified herein, shall give effect to any related Debt Service Reduction and
any Deficient Valuation that affects the amount of the monthly payment due
on
such Mortgage Loan.
Securities
Act:
The
Securities Act of 1933, as amended and the rules and regulations
thereunder.
Securities
Administrator:
▇▇▇▇▇
Fargo and any successors in interest, and if a successor securities
administrator is appointed hereunder, such successor.
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Securities
Administrator Float Period:
With
respect to the Distribution Date and the related amounts in the Distribution
Account, the period commencing on the Remittance Date immediately preceding
such
Distribution Date and ending on such Distribution Date.
Seller’s
Warranties and Servicing Agreement:
The
Seller’s Warranties and Servicing Agreement between the Sponsor, as purchaser of
the Mortgage Loans, and ▇▇▇▇▇ Fargo, as Seller, dated as of April 1,
2007.
Senior
Interest Payment Amount:
With
respect to any Distribution Date and any Class of Class A
Certificates, the sum of the Interest Payment Amount and the Interest Carry
Forward Amount, if any, for that Distribution Date for that Class.
Servicer:
▇▇▇▇▇
Fargo, and any successor in interest.
Servicer
Remittance Report:
As
defined in Section 4.03(d).
Service(s)(ing):
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 Item 1108 of Regulation AB. For
clarification purposes, any uncapitalized occurrence of this term in this
Agreement shall have the meaning commonly understood by participants in the
residential mortgage-backed securitization market.
Servicing
Advances:
With
respect to the Servicer and the Master Servicer (including the Trustee in its
capacity as successor master servicer), all customary and reasonable
“out-of-pocket” costs and expenses (including reasonable legal fees and
expenses) incurred by the Servicer in the performance of its servicing
obligations in connection with a default, delinquency or other unanticipated
event, including, but not limited to, the cost of (i) the maintenance,
preservation, restoration, inspection and protection of a Mortgaged Property,
(ii) any enforcement or judicial proceedings, including foreclosures and
litigation, in respect of a particular Mortgage Loan, (iii) the management
(including reasonable fees in connection therewith) and liquidation of any
REO
Property and (iv) the performance of its obligations under
Sections 3.01, 3.09, 3.13 and 3.15. The Servicing Advances shall also
include any reasonable “out-of-pocket” costs and expenses (including reasonable
legal fees and expenses) incurred by the Servicer in connection with executing
and recording instruments of satisfaction, deeds of reconveyance or Assignments
of Mortgage in connection with any satisfaction or foreclosure in respect of
any
Mortgage Loan to the extent not recovered from the Mortgagor or otherwise
payable under this Agreement and obtaining or correcting any legal documentation
required to be included in the Mortgage File and necessary for the Servicer
to
perform its obligations under this Agreement. The Servicer shall not be required
to make any Nonrecoverable Servicing Advances.
Servicing
Criteria:
The
criteria set forth in paragraph (d) of Item 1122 of Regulation AB, as such
may
be amended from time to time.
Servicing
Fee:
With
respect to each Mortgage Loan and for any calendar month, an amount equal to
one
month’s interest (or in the event of any payment of interest which accompanies a
Principal Prepayment made by the Mortgagor during such calendar month, interest
for the number of days covered by such payment of interest) at the applicable
Servicing Fee Rate on the applicable Stated Principal Balance of such Mortgage
Loan as of the first day of such calendar month. Such fee shall be payable
monthly, and shall be prorated for any portion of a month during which the
Mortgage Loan is serviced by the Servicer under this Agreement. The Servicing
Fee is payable solely from the interest portion (including recoveries with
respect to interest from Liquidation Proceeds, Subsequent Recoveries, Insurance
Proceeds, Condemnation Proceeds and proceeds received with respect to
REO Properties) of such Scheduled Payment collected by the Servicer, or as
otherwise provided under Section 3.11.
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Servicing
Fee Rate:
With
respect to each Mortgage Loan, 0.500% per annum.
Servicing
File:
With
respect to each Mortgage Loan, the file retained by the Servicer consisting
of
originals or copies of all documents in the Mortgage File which are not
delivered to the Custodian on behalf of the Trustee in the Custodial File and
copies of the Mortgage Loan Documents set forth in Exhibit K
hereto.
Servicing
Function Participant:
Any
Sub-Servicer or Subcontractor of the Servicer, the Master Servicer, the
Custodian or the Securities Administrator, respectively, that is “participating
in the servicing function” within the meaning of Item 1122 of Regulation
AB.
Servicing
Officer:
Any
officer of the Servicer involved in, or responsible for, the administration
and
servicing of the Mortgage Loans whose name and facsimile signature appear on
a
list of servicing officers furnished to the Master Servicer and the Trustee
by
the Servicer on the Closing Date pursuant to this Agreement, as such list may
from time to time be amended.
Similar
Law:
As
defined in Section 5.02(b).
60+
Day Delinquent Mortgage Loan:
Each
Mortgage Loan with respect to which any portion of a Scheduled Payment is,
as of
the last day of the prior Due Period, two months or more past due (including
any
such Mortgage Loan in foreclosure, any such Mortgage Loan related to REO
Property and any such Mortgage Loan where the related Mortgagor has filed for
bankruptcy), without giving effect to any grace period.
Sponsor:
HSBC
Bank USA, National Association, a national banking association, and its
successors in interest.
Standard &
Poor’s:
Standard & Poor’s Ratings Services, a division of The ▇▇▇▇▇▇-▇▇▇▇
Companies, Inc. If Standard & Poor’s is designated as a Rating Agency
in the Preliminary Statement, for purposes of Section 12.05(c) the address
for notices to Standard & Poor’s shall be Standard & Poor’s,
▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇, Attention: Residential Mortgage
Surveillance Group - HASCO (HSI Asset Securitization Corporation Trust),
Series 2007-WF1, or such other address as Standard & Poor’s may
hereafter furnish to the Depositor and the Securities
Administrator.
Standard &
Poor’s Glossary:
The
Standard & Poor’s LEVELS® Glossary, as may be in effect from time to
time.
Startup
Day:
The
Closing Date.
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Stated
Principal Balance:
As to
each Mortgage Loan and as of any date of determination, (i) the principal
balance of the Mortgage Loan at the Cut-off Date after giving effect to payments
of principal due on or before such date (whether or not received), minus
(ii) all amounts previously remitted to the Securities Administrator with
respect to the related Mortgage Loan representing payments or recoveries of
principal including advances in respect of scheduled payments of principal.
For
purposes of any Distribution Date, the Stated Principal Balance of any Mortgage
Loan will give effect to any scheduled payments of principal received by the
Servicer on or prior to the related Determination Date or advanced by the
Servicer for the related Remittance Date and any unscheduled principal payments
and other unscheduled principal collections received during the related
Prepayment Period, and the Stated Principal Balance of any Mortgage Loan that
has prepaid in full or has become a Liquidated Mortgage Loan during the related
Prepayment Period shall be zero.
Stepdown
Date:
The
earlier to occur of (i) the first Distribution Date following the Distribution
Date on which the aggregate Class Certificate Balances of the Class A
Certificates have been reduced to zero and (ii) the later to occur of (a) the
Distribution Date in July 2010 and (b) the first Distribution Date on which
the
Credit Enhancement Percentage for the Class A Certificates (calculated for
this
purpose only after taking into account payments of principal applied to reduce
the Stated Principal Balance of the Mortgage Loans for that Distribution Date
but prior to any applications of Principal Payment Amount to the Certificates
on
that Distribution Date) is greater than or equal to 36.20%.
Subcontractor:
Any
vendor, subcontractor or other Person that is not responsible for the overall
servicing of the 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 the Servicer (or a Sub-Servicer of the Servicer),
the Master Servicer, the Custodian or the Securities Administrator.
Subsequent
Recovery:
With
respect to any Mortgage Loan or related Mortgaged Property that became a
Liquidated Mortgage Loan or was otherwise disposed of, all amounts received
in
respect of such Liquidated Mortgage Loan after an Applied Realized Loss Amount
related to such Mortgage Loan or Mortgaged Property is allocated to reduce
the
Class Certificate Balance of any Class of Class M Certificates.
Any Subsequent Recovery that is received during a Prepayment Period will be
included as part of the Principal Remittance Amount for the related Distribution
Date.
Sub-Servicer:
Any
Person that services Mortgage Loans on behalf of a Servicer, and is responsible
for the performance (whether directly or through sub-servicers or
Subcontractors) of servicing functions required to be performed under this
Agreement, any related servicing agreement or any sub-servicing agreement that
are identified in Item 1122(d) of Regulation AB.
Subservicing
Account:
As
defined in Section 3.08.
Subservicing
Agreement:
As
defined in Section 3.02(a).
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Substitute
Mortgage Loan:
A
Mortgage Loan substituted by the Originator or the Sponsor for a Deleted
Mortgage Loan which must, on the date of such substitution, as confirmed in
a
Request for Release, substantially in the form of Exhibit J,
(i) have a Stated Principal Balance, after deduction of all Scheduled
Payments due in the month of substitution, not in excess of the Stated Principal
Balance of the Deleted Mortgage Loan; (ii) be accruing interest at a rate
not lower than and not more than 1.00% higher than that of the Deleted Mortgage
Loan; (iii) have a remaining term to maturity not greater than (and not
more than one year less than) that of the Deleted Mortgage Loan; (iv) be of
the same type as the Deleted Mortgage Loan; and (v) comply with each
representation and warranty set forth in Section 2.03.
Substitution
Adjustment Amount: As
defined in Section 2.03.
Supplemental
Interest Trust:
The
corpus of a trust created pursuant to Section 4.06 of this Agreement and
designated as the “Supplemental Interest Trust,” consisting of the Swap
Agreement, the Supplemental Interest Trust Account, the Swap Account, the Excess
Reserve Fund Account, the Cap Agreement, the Cap Account, the Collateral
Account, the right to receive the Class X Distributable Amount as provided
in
Section 4.02(a)(iii)(H), the Class LT3-I Interest in REMIC 3 and the right
to
receive Class I Shortfalls.
Supplemental
Interest Trust Account:
The
Account created pursuant to Section 4.06(a).
Supplemental
Interest Trust Trustee:
The
trustee of the Supplemental Interest Trust appointed pursuant to Section
4.06(a), which is initially ▇▇▇▇▇ Fargo.
Swap
Account:
The
sub-account of the Supplemental Interest Trust Account created pursuant to
Section 4.06(a).
Swap
Agreement:
The
interest rate swap agreement entered into by the Supplemental Interest Trust
Trustee, on behalf of the Supplemental Interest Trust and the Swap Counterparty,
dated July 3, 2007, which agreement provides for, among other things, a Net
Swap
Payment to be paid pursuant to the conditions provided therein, commencing
with
the Distribution Date in August 2007 and ending on the Distribution Date in
March 2011, together with any schedules, confirmations or other agreements
relating thereto, attached hereto as Exhibit O.
Swap
Amount:
With
respect to each Distribution Date and the related Swap Payment Date, the sum
of
any Net Swap Payment and any Swap Termination Payment deposited in the Swap
Account.
Swap
Counterparty:
The
counterparty to the Supplemental Interest Trust under the Swap Agreement, and
any successor in interest or assigns. Initially, the Swap Counterparty shall
be
Credit Suisse International.
Swap
Counterparty Trigger Event:
A Swap
Counterparty Trigger Event shall have occurred if any of a Swap Default with
respect to which the Swap Counterparty is a Defaulting Party, a Termination
Event (other than a “Tax Event” or “Illegality” as such terms are defined in the
Master Agreement) with respect to which the Swap Counterparty is the sole
Affected Party or an Additional Termination Event with respect to which the
Swap
Counterparty is the sole Affected Party has occurred.
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Swap
Default:
Any of
the circumstances constituting an “Event of Default” under the Swap
Agreement.
Swap
LIBOR:
With
respect to any Distribution Date (and the Accrual Period relating to such
Distribution Date), the product of (i) the Floating Rate Option (as defined
in
the Swap Agreement) for the related Swap Payment Date, (ii) two, and (iii)
the
quotient of (a) the actual number of days in the Accrual Period for the LIBOR
Certificates and (b) 30, as calculated by the Swap Counterparty and furnished
to
the Securities Administrator.
Swap
Payment Date:
For so
long as the Swap Agreement is in effect or any amounts remain unpaid thereunder,
the Business Day immediately preceding each Distribution Date.
Swap
Replacement Receipts:
As
defined in Section 4.08(a)(i).
Swap
Replacement Receipts Account:
As
defined in Section 4.08(a)(i).
Swap
Termination Payment:
Upon
the designation of an “Early Termination Date” as defined in the Swap Agreement,
the payment required to be made by the Supplemental Interest Trust to the Swap
Counterparty, or by the Swap Counterparty to the Supplemental Interest Trust,
as
applicable, pursuant to the terms of the Swap Agreement, and any unpaid amounts
due on previous Distribution Dates and accrued interest thereon as provided
in
the Swap Agreement, as calculated by the Swap Counterparty and furnished to
the
Securities Administrator.
Swap
Termination Receipts:
As
defined in Section 4.08(a)(i).
Swap
Termination Receipts Account:
As
defined in Section 4.08(a)(i).
Tax
Matters Person:
The
Holder of the Class R Certificates designated as “tax matters person” of each
REMIC created hereunder in the manner provided under Treasury Regulations
Section 1.860F-4(d) and Treasury Regulations Section
301.6231(a)(7)-1.
Termination
Event:
The
occurrence of a termination event under the termination provision of the Cap
Agreement or Swap Agreement, as applicable.
Termination
Price:
As
defined in Section 11.01.
Total
Monthly Excess Spread:
As to
any Distribution Date, an amount equal to the excess, if any, of (i) the
interest on the Mortgage Loans received by the Servicer on or prior to the
related Determination Date or advanced by the Servicer for the related
Remittance Date (net of Expense Fees) over (ii) the sum of the amounts
payable to the Certificates pursuant to Section 4.02(a)(i)(A) through (C)
on such Distribution Date.
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Transfer:
Any
direct or indirect transfer or sale of any Ownership Interest in a Residual
Certificate.
Transfer
Affidavit:
As
defined in Section 5.02(c).
Transferor
Certificate:
As
defined in Section 5.02(b).
Trigger
Event:
Either
a Cumulative Loss Trigger Event or a Delinquency Trigger Event.
Trust:
The
express trust created hereunder in Section 2.01(c).
Trust
Fund:
The
corpus of the trust created hereunder consisting of (i) the Mortgage Loans
and all interest and principal with respect thereto received on or after the
related Cut-off Date, other than such amounts which were due on the Mortgage
Loans on or prior to the related Cut-off Date; (ii) the Collection Account,
the Distribution Account, the Cap Termination Receipts Account, the Cap
Replacement Receipts Account the Swap Termination Receipts Account, the Swap
Replacement Receipts Account and
all
amounts deposited therein pursuant to the applicable provisions of this
Agreement; (iii) property that secured a Mortgage Loan and has been
acquired by foreclosure, deed-in-lieu of foreclosure or otherwise; (iv) the
Depositor’s rights under the Purchase Agreement; (v) the Insurance
Policies; and (vi) all proceeds of the conversion, voluntary or
involuntary, of any of the foregoing.
Trustee:
Deutsche Bank National Trust Company, a national banking association, and its
successors in interest and, if a successor trustee is appointed hereunder,
such
successor.
Underwriters’
Exemption:
Any
exemption listed under footnote 1 of, and amended by, Prohibited Transaction
Exemption 96-84, 61 Fed. Reg. 58234 (1996), as amended by ▇▇▇ ▇▇-▇▇,
▇▇ ▇▇▇. ▇▇▇. ▇▇▇▇▇ (1997), PTE 2000-58, 65 Fed. Reg. 67765 (2000) and
PTE 2002-41, 67 Fed. Reg. 54487 (2002) and PTE 2007-5, 72 Fed. Reg. 13130
(2007), or any successor exemption.
Unpaid
Realized Loss Amount:
With
respect to any Class of Class M Certificates and as to any
Distribution Date, is the excess of (i) Applied Realized Loss Amounts with
respect to such Class over (ii) the sum of (a) all distributions
in reduction of such Applied Realized Loss Amounts on all previous Distribution
Dates, and (b) the amount by which the Class Certificate Balance of
such Class has been increased due to the distribution of any Subsequent
Recoveries on all previous Distribution Dates. Any amounts distributed to a
Class of Class M Certificates in respect of any Unpaid Realized Loss
Amount will not be applied to reduce the Class Certificate Balance of such
Class.
Upper
Tier REMIC:
As
described in the Preliminary Statement.
Upper
Tier REMIC Regular Interest:
As
described in the Preliminary Statement.
U.S.
Person:
(i) A citizen or resident of the United States; (ii) a corporation (or
entity treated as a corporation for tax purposes) created or organized in the
United States or under the laws of the United States or of any State thereof,
including, for this purpose, the District of Columbia; (iii) a partnership
(or entity treated as a partnership for tax purposes) organized in the United
States or under the laws of the United States or of any State thereof,
including, for this purpose, the District of Columbia (unless provided otherwise
by future Treasury regulations); (iv) an estate whose income is includible
in gross income for United States income tax purposes regardless of its source;
or (v) a trust, if a court within the United States is able to exercise
primary supervision over the administration of the trust and one or more U.S.
Persons have authority to control substantial decisions of the trust.
Notwithstanding the last clause of the preceding sentence, to the extent
provided in Treasury regulations, certain trusts in existence on August 20,
1996, and treated as U.S. Persons prior to such date, may elect to continue
to
be U.S. Persons.
-48-
Voting
Rights:
The
portion of the voting rights of all of the Certificates which is allocated
to
any Certificate. As of any date of determination, 1.00% of all Voting Rights
shall be allocated to each of the Class X, Class P and Class R Certificates,
if
any (such Voting Rights to be allocated among the holders of Certificates
of
each such Class in accordance with their respective Percentage Interests)
and the remaining Voting Rights shall be allocated among Holders of the
remaining Classes of Certificates in proportion to the Certificate Balances
of
their respective Certificates on such date.
▇▇▇▇▇
Fargo:
▇▇▇▇▇
Fargo Bank, N.A., a national banking association, and its successors in
interest.
ARTICLE
II
CONVEYANCE
OF MORTGAGE LOANS;
REPRESENTATIONS
AND WARRANTIES
Section
2.01 Conveyance
of Mortgage Loans.
(a) The Depositor, concurrently with the execution and delivery hereof,
hereby sells, transfers, assigns, sets over and otherwise conveys to the
Trustee
for the benefit of the Certificateholders, without recourse, all the right,
title and interest of the Depositor in and to the Trust Fund including all
interest and principal received on or with respect to the Mortgage Loans
on or
after the Cut-off Date (other than Scheduled Payments due on the Mortgage
Loans
on or before the Cut-off Date).
Concurrently
with the execution of this Agreement, the Derivative Agreements shall be
delivered to the Securities Administrator. In connection therewith, the
Depositor hereby directs the Securities Administrator (solely in its capacity
as
Supplemental Interest Trust Trustee) and the Securities Administrator is
hereby
authorized to execute and deliver each of the Derivative Agreements on behalf
of
the Supplemental Interest Trust, for the benefit of Certificateholders. The
Depositor, the Sponsor, the Master Servicer, the Servicer, the Originator,
the
Credit Risk Manager and the Certificateholders (by their acceptance of such
Certificates) acknowledge and agree that the Securities Administrator is
executing and delivering the Derivative Agreements solely in its capacity
as
Supplemental Interest Trust Trustee and not in its individual capacity. The
Securities Administrator shall have no duty or responsibility to enter into
any
other interest rate swap agreement upon the expiration or termination of
the
Swap Agreement or interest rate cap agreement upon the termination of the
Cap
Agreement unless so directed by the Depositor.
-49-
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 Purchase
Agreement, including the right to enforce the Sponsor’s obligation to repurchase
or substitute defective Mortgage Loans under Section 5 of the Purchase
Agreement. The Trustee hereby accepts such assignment, and as set forth herein
in Section 2.03(k), shall be entitled to exercise all the rights of the
Depositor under the Purchase Agreement as if, for such purpose, it were the
Depositor.
(b) In
connection with the transfer and assignment of each Mortgage Loan, the Depositor
has delivered or caused to be delivered to the Custodian for the benefit
of the
Certificateholders the following documents or instruments with respect to
each
Mortgage Loan so assigned:
(i) the
original Mortgage Note bearing all intervening endorsements necessary to
show a
complete chain of endorsements from the original payee, endorsed in blank,
“Pay
to the order of _____________, without recourse”, and, if previously endorsed,
signed in the name of the last endorsee by a duly qualified officer of the
last
endorsee;
(ii) the
original Assignment of Mortgage for each Mortgage Loan, in form and substance
acceptable for recording. The Mortgage shall be assigned, with assignee’s name
left blank;
(iii) the
original of each guarantee executed in connection with the Mortgage Note,
if
any;
(iv) the
original recorded Mortgage, with evidence of recording thereon. If in connection
with any Mortgage Loan, the original Mortgage cannot be delivered with evidence
of recording thereon on or prior to the Closing Date because of a delay caused
by the public recording office where such Mortgage has been delivered for
recordation or because such Mortgage has been lost or because such public
recording office retains the original recorded Mortgage, the Originator shall
deliver or cause to be delivered to the Custodian, (A) in the case of a
delay caused by the public recording office, a copy of such Mortgage certified
by the Originator, escrow agent, title insurer or closing attorney to be
a true
and complete copy of the original recorded Mortgage and (B) in the case
where a public recording office retains the original recorded Mortgage or
in the
case where a Mortgage is lost after recordation in a public recording office,
a
copy of such Mortgage certified by such public recording office to be a true
and
complete copy of the original recorded Mortgage;
(v) originals
or a certified copy of each modification agreement, if any;
(vi) the
originals of all 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 (A) in the case of a delay caused by the public
recording office, an officer’s certificate of the Originator, escrow agent,
closing attorney or the title insurer insuring the Mortgage 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 Originator; or (B) 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;
-50-
(vii) 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 copy
of the
power of attorney or other instrument that authorized and empowered such
Person
to sign;
(viii) the
original lender’s title insurance policy (or a marked title insurance
commitment, in the event that an original lender’s title insurance policy has
not yet been issued) in the form of an ALTA mortgage title insurance policy,
containing all required endorsements and insuring the Trustee and its successors
and assigns as to the first priority lien of the Mortgage in the original
principal amount of the Mortgage Loan;
(ix) if
applicable, the original of any Primary Mortgage Insurance Policy or certificate
or, an electronic certification, evidencing the existence of the Primary
Mortgage Insurance Policy or certificate, if private mortgage guaranty insurance
is required; and
(x) original
of any security agreement, chattel mortgage or equivalent document executed
in
connection with the Mortgage, if any.
To
the
extent not previously delivered to the Sponsor pursuant to the Seller’s
Warranties and Servicing Agreement, the Originator shall promptly upon receipt
from the respective recording office cause to be delivered to the Custodian
the
original recorded document described in clauses (iv) and
(vi) above.
From
time
to time, the Originator, the Depositor or the Servicer, as applicable, shall
forward to the Custodian additional original documents, additional documents
evidencing an assumption, modification, consolidation or extension of a Mortgage
Loan, in accordance with the terms of this Agreement upon receipt of such
documents. All such mortgage documents held by the Custodian as to each Mortgage
Loan shall constitute the “Custodial
File”.
-51-
To
the
extent not previously delivered to the Sponsor pursuant to the Seller’s
Warranties and Servicing Agreement, on or prior to the Closing Date, the
Originator shall deliver to the Custodian Assignments of Mortgages, in blank,
for each Mortgage Loan. No later than thirty (30) Business Days following
the
later of the Closing Date and the date of receipt by the Servicer of the
complete recording information for a Mortgage, the Servicer shall promptly
submit or cause to be submitted for recording, at the expense of the Originator
and at no expense to the Trust Fund, the Trustee, the Servicer or the Depositor,
in the appropriate public office for real property records, each Assignment
of
Mortgage referred to in Section 2.01(b)(ii). Notwithstanding the foregoing,
however, for administrative convenience and facilitation of servicing and
to
reduce closing costs, the Assignments of Mortgage shall not be required to
be
completed and submitted for recording with respect to any Mortgage Loan if
the Trustee and each Rating Agency have received an Opinion of Counsel from
the
Depositor, satisfactory in form and substance to the Trustee and each Rating
Agency to the effect that the recordation of such Assignments of Mortgage
in any
specific jurisdiction is not necessary to protect the Trust Fund’s interest in
the related Mortgage Note. If the Assignment of Mortgage is to be recorded,
the
Mortgage shall be assigned by the Originator, at the expense of the Originator,
to “Deutsche Bank National Trust Company, as trustee under the Pooling and
Servicing Agreement dated as of June 1, 2007, for HSI Asset Securitization
Corporation Trust 2007-WF1”. In the event that any such Assignment of Mortgage
is lost or returned unrecorded because of a defect therein, the Originator
shall
promptly cause to be delivered a substitute Assignment of Mortgage to cure
such
defect and thereafter cause each such assignment to be duly recorded at no
expense to the Trust Fund.
In
the
event that such original or copy of any document submitted for recordation
to
the appropriate public recording office is not so delivered to the Custodian
within 180 days (or such other time period as may be required by any Rating
Agency) following the Closing Date, and in the event that the Originator
does
not cure such failure within 30 days of discovery or receipt of written
notification of such failure from the Depositor, the related Mortgage Loan
shall, upon the request of the Depositor, be repurchased by the Originator
at
the price and in the manner specified in Section 2.03. The foregoing
repurchase obligation shall not apply in the event that the Originator cannot
deliver such original or copy of any document submitted for recordation to
the
appropriate public recording office within the specified period due to a
delay
caused by the recording office in the applicable jurisdiction; provided,
that
the Originator shall instead deliver a recording receipt of such recording
office or, if such recording receipt is not available, an officer’s certificate
of an officer of the Originator, confirming that such document has been accepted
for recording.
Notwithstanding
anything to the contrary contained in this Section 2.01, in those instances
where the public recording office retains or loses the original Mortgage
or
assignment after it has been recorded, the obligations of the Originator
shall
be deemed to have been satisfied upon delivery by the Originator to the
Custodian, prior to the Closing Date of a copy of such Mortgage or assignment,
as the case may be, certified (such certification to be an original thereof)
by
the public recording office to be a true and complete copy of the recorded
original thereof.
(c) The
Depositor does hereby establish, pursuant to the further provisions of this
Agreement and the laws of the State of New York, an express trust (the
“Trust”)
to be
known, for convenience, as “HSI Asset Securitization Corporation Trust 2007-WF1”
and Deutsche Bank National Trust Company is hereby appointed as Trustee and
▇▇▇▇▇ Fargo Bank, N.A. is appointed as Securities Administrator in accordance
with the provisions of this Agreement. The parties hereto acknowledge and
agree
that it is the policy and intention of the Trust to acquire only Mortgage
Loans
meeting the requirements set forth in this Agreement, including without
limitation, the representations and warranties set forth in Exhibit Q
hereto.
-52-
(d) The
Trust
shall have the capacity, power and authority, and the Trustee on behalf
of the
Trust is hereby authorized, to accept the sale, transfer, assignment, set
over
and conveyance by the Depositor to the Trust of all the right, title and
interest of the Depositor in and to the Trust Fund (including, without
limitation, the Mortgage Loans) pursuant to Section 2.01(a).
Section
2.02 Acceptance
by the Custodian of the Mortgage Loans. The Custodian shall acknowledge, on
the Closing Date, receipt by the Custodian of the documents identified
in the
Initial Certification in the form annexed hereto as Exhibit E
(“Initial
Certification”),
and
declares that it holds and will hold such documents and the other documents
delivered to it pursuant to Section 2.01, and that it holds or will hold
such other assets as are included in the Trust Fund, in trust for the exclusive
use and benefit of all present and future Certificateholders. The Custodian
shall maintain possession of the related Mortgage Notes in the States of
Minnesota, California, and Utah unless otherwise permitted by the Rating
Agencies.
In
connection with the Closing Date, the Custodian shall be required to deliver
via
facsimile (with original to follow the next Business Day) to the Depositor,
the
Securities Administrator, the Servicer and the Trustee, an Initial Certification
prior to the Closing Date, or, as the Depositor agrees on the Closing Date,
certifying receipt of a Mortgage Note and Assignment of Mortgage for each
Mortgage Loan. The Custodian shall not be responsible to verify the validity,
sufficiency or genuineness of any document in any Custodian File.
Within
90 days of the Closing Date, the Custodian shall ascertain that all
documents identified in the Document Certification and Exception Report
in the
form attached hereto as Exhibit F are in its possession, and shall deliver
to the Depositor, the Securities Administrator, the Trustee, the Originator,
the
Servicer, a Document Certification and Exception Report, in the form annexed
hereto as Exhibit F, to the effect that, as to each Mortgage Loan listed in
the Mortgage Loan Schedule (other than any Mortgage Loan paid in full or
any
Mortgage Loan specifically identified in such certification as an exception
and
not covered by such certification): (i) all documents identified in the
Document Certification and Exception Report and required to be reviewed
by it
are in its possession; (ii) such documents have been reviewed by it and
appear regular on their face and relate to such Mortgage Loan; (iii) based
on its examination and only as to the foregoing documents, the Mortgage
Loan
identifying number, the state and five-digit ZIP code of the Mortgaged
Property
and the original principal balance of the Mortgage Loan is correct; and
(iv) each Mortgage Note has been endorsed as provided in Section 2.01
of this Agreement. Neither the Trustee nor the Custodian shall be responsible
to
verify the validity, sufficiency or genuineness of any document in any
Custodial
File.
The
Custodian shall retain possession and custody of each Custodial File in
accordance with and subject to the terms and conditions set forth herein.
The
Servicer shall promptly deliver to the Custodian, upon the execution or
receipt
thereof, the originals of such other documents or instruments constituting
the
Custodial File as come into the possession of the Servicer from time to
time.
-53-
Section
2.03 Representations,
Warranties and Covenants of the Originator and the Servicer; Remedies for
Breaches of Representations and Warranties with Respect to the Mortgage
Loans. (a) ▇▇▇▇▇ Fargo, in its capacity as Servicer, makes the
representations and warranties set forth in Section 3.01 of the Seller’s
Warranties and Servicing Agreement attached as Exhibit Q hereto, to the
Depositor, the Master Servicer, the Securities Administrator and the Trustee
as
of the Closing Date.
(b) ▇▇▇▇▇
Fargo, in its capacity as Originator, makes the representations and warranties
set forth in (1) Section 3.01 of the Seller’s Warranties and Servicing Agreement
attached as Exhibit Q hereto as of the Closing Date and (2) Section 3.02
of the
Seller’s Warranties and Servicing Agreement attached as Exhibit Q hereto as of
the Initial Sale Date, to the Depositor, the Master Servicer, the Securities
Administrator and the Trustee as of the date specified therein.
(c) It
is
understood and agreed by the Servicer and the Originator that the
representations and warranties set forth in this Section 2.03 shall survive
the transfer of the Mortgage Loans by the Depositor to the Trustee on the
Closing Date, and shall inure to the benefit of the Depositor, the Trustee
and
the Trust Fund notwithstanding any restrictive or qualified endorsement
on any
Mortgage Note or Assignment of Mortgage or the examination or failure to
examine
any Mortgage File. Upon discovery by the Originator, the Depositor, the
Securities Administrator, the Trustee, the Master Servicer or the Servicer
of a
breach of any of the foregoing representations and warranties, the party
discovering such breach shall give prompt written notice to the
others.
(d) Within
30 days of the earlier of either discovery by or notice to the Originator
that any Mortgage Loan does not conform to the requirements as determined
in the
Custodian’s review of the related Custodial File or within 60 days of the
earlier of either discovery by or notice to the Originator of any breach
of a
representation or warranty referred to in Section 2.03(b) that materially
and adversely affects the value of any Mortgage Loan or the interest of
the
Trustee or the Certificateholders therein, the Originator shall use its
best
efforts to cause to be remedied a material defect in a document constituting
part of a Mortgage File or promptly to cure such breach in all material
respects
and, if such defect or breach cannot be remedied, the Originator shall,
at the
Depositor’s option as specified in writing and provided to the Originator and
the Trustee, (i) if such 30- or 60-day period, as applicable, expires prior
to the second anniversary of the Closing Date, remove such Mortgage Loan
(a
“Deleted
Mortgage Loan”)
from
the Trust Fund and substitute in its place a Substitute Mortgage Loan,
in the
manner and subject to the conditions set forth in this Section 2.03; or
(ii) repurchase such Mortgage Loan at the Repurchase Price; provided,
however,
that
any such substitution pursuant to clause (i) above shall not be
effected prior to the delivery to the Custodian of a Request for Release
substantially in the form of Exhibit J, and the delivery of the Mortgage
File to the Custodian for any such Substitute Mortgage Loan. Notwithstanding
the
foregoing, a breach (i) that causes a Mortgage Loan not to constitute a
“qualified mortgage” within the meaning of Section 860G(a)(3) of the Code
or (ii) of any of the representations and warranties set forth in items
(i),
(oo), (qq), (ss), (vv) and (yy) of Section 3.02 of the Seller’s Warranties and
Servicing Agreement attached as Exhibit Q hereto with respect to any Mortgage
Loan will be deemed automatically to materially and adversely affect the
value
of such Mortgage Loan and the interests of the Trustee and Certificateholders
in
such Mortgage Loan, thus requiring the repurchase or substitution of such
Mortgage Loan by the Originator. In the event that a Responsible Officer
of the
Trustee receives notice of a breach by the Originator of any of the
representations and warranties described in the immediately preceding sentence,
the Trustee shall give notice of such breach to the Originator and request
the
Originator to substitute such Mortgage Loan or to repurchase such Mortgage
Loan
at the Repurchase Price within sixty (60) days of the receipt of such
notice. The Originator shall repurchase each such Mortgage Loan within
60 days of the earlier of discovery or receipt of notice with respect to
each such Mortgage Loan.
-54-
(e) With
respect to any Substitute Mortgage Loan or Loans, the Originator shall
deliver
to the Custodian for the benefit of the Certificateholders the Mortgage
Note,
the Mortgage, the related assignment of the Mortgage, and such other documents
and agreements as are required by Section 2.01, with the Mortgage Note
endorsed and the Mortgage assigned as required by Section 2.01. No
substitution is permitted to be made with respect to any Distribution Date
after
the end of the related Prepayment Period. Scheduled Payments due with respect
to
Substitute Mortgage Loans in the Due Period of substitution shall not be
part of
the Trust Fund and will be retained by the Originator on the next succeeding
Distribution Date. For the Due Period of substitution, distributions to
Certificateholders will include the Scheduled Payment due on any Deleted
Mortgage Loan for such Due Period and thereafter the Originator shall be
entitled to retain all amounts received in respect of such Deleted Mortgage
Loan.
(f) Upon
removal of such Deleted Mortgage Loan and the substitution of the Substitute
Mortgage Loan or Loans, the Substitute Mortgage Loan or Loans shall be
subject
to the terms of this Agreement in all respects, and the Originator shall
be
deemed to have made with respect to such Substitute Mortgage Loan or Loans,
as
of the date of substitution, the representations and warranties made pursuant
to
Section 2.03(b) with respect to such Mortgage Loan. Upon any such
substitution and the deposit to the Collection Account of the amount required
to
be deposited therein in connection with such substitution as described
in the
following paragraph, the Custodian shall release the Mortgage File held
for the
benefit of the Certificateholders relating to such Deleted Mortgage Loan
to the
Originator and the Trustee, upon receipt of a Request for Release certifying
that all amounts required to be deposited in accordance with this Section
2.03(f) have been deposited in the Collection Account, shall execute and
deliver
at the Originator’s direction such instruments of transfer or assignment
prepared by the Originator in each case without recourse, as shall be necessary
to vest title in the Originator of the Trustee’s interest in any Deleted
Mortgage Loan substituted for pursuant to this Section 2.03.
(g) For
any
month in which the Originator substitutes one or more Substitute Mortgage
Loans
for one or more Deleted Mortgage Loans, the Servicer will determine the
amount
(if any) by which the aggregate unpaid principal balance of all such Substitute
Mortgage Loans as of the date of substitution is less than the aggregate
unpaid
principal balance of all such Deleted Mortgage Loans. The amount of such
shortage plus an amount equal to the aggregate of any unreimbursed Advances
with
respect to such Deleted Mortgage Loans (collectively, the “Substitution
Adjustment Amount”)
shall
be remitted by the Originator to the Servicer for deposit into the Collection
Account on or before the Remittance Date for the Distribution Date in the
month
succeeding the calendar month during which the related Mortgage Loan became
required to be purchased or replaced hereunder.
-55-
(h) In
addition to the repurchase or substitution obligations referred to in
Section 2.03(d) above and Section 2.03 (k) below, the Originator or
the Sponsor, as applicable, shall indemnify the Depositor, any of its
Affiliates, the Master Servicer, the Servicer, the Securities Administrator,
the
Trustee and the Trust and hold such parties harmless against any losses,
damages, penalties, fines, forfeitures, reasonable and necessary legal
fees and
related costs, judgments and other costs and expenses (including, without
limitation, any taxes payable by the Trust) resulting from any third party
claim, demand, defense or assertion based on or grounded upon, or resulting
from, a breach by the Originator or the Sponsor, as applicable, of any
of its
representations and warranties or obligations contained in this
Agreement.
(i) The
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 Substitute Mortgage Loan or Loans and the Servicer
shall
deliver the amended Mortgage Loan Schedule to the Trustee, the Custodian,
the
Master Servicer and the Securities Administrator.
(j) In
the
event that a Mortgage Loan shall have been repurchased pursuant to this
Agreement or the Purchase Agreement, the proceeds from such repurchase
shall be
deposited by the Servicer in the Collection Account pursuant to
Section 3.10 on or before the Remittance Date for the Distribution Date in
the month following the month during which the Originator or Sponsor became
obligated to repurchase or replace such Mortgage Loan and upon such deposit
of
the Repurchase Price, and receipt of a Request for Release in the form
of
Exhibit J hereto, the Custodian shall release the related Custodial File
held for the benefit of the Certificateholders to the Originator or the
Sponsor,
as applicable, as directed by the Servicer, and the Trustee shall execute
and
deliver at such Person’s direction such instruments of transfer or assignment
prepared by such Person, in each case without recourse, as shall be necessary
to
transfer title from the Trustee. In accordance with Section 12.05(a), if a
Responsible Officer of the Securities Administrator has actual knowledge
of a
purchase of a Mortgage Loan pursuant to this Section 2.03, the Securities
Administrator shall promptly notify each Rating Agency of a purchase of
a
Mortgage Loan pursuant to this Section 2.03.
It
is
understood and agreed that the obligation of the Originator under this
Agreement
to cure, repurchase or substitute any Mortgage Loan as to which a breach
of a
representation and warranty has occurred and is continuing, together with
any
related indemnification obligations of the Originator set forth in
Section 2.03(h), shall constitute the sole remedies against such Person
respecting such breach available to Certificateholders, the Depositor and
any of
its Affiliates, or the Trustee on their behalf.
(k) The
Trustee acknowledges that, except as provided in Section 5 of the Purchase
Agreement, the Sponsor shall not have any obligation or liability with
respect
to any breach of a representation or warranty made by it with respect to
a
Mortgage Loan sold by it, provided that such representation or warranty
was also
made by the Originator with respect to the related Mortgage Loan. It is
understood and agreed that the representations and warranties of the Sponsor
set
forth in Section 4 of the Purchase Agreement and assigned to the Trustee
by the
Depositor hereunder shall survive the transfer of the Mortgage Loans by
the
Depositor to the Trustee on the Closing Date, and shall inure to the benefit
of
the Trustee and the Certificateholders notwithstanding any restrictive
or
qualified endorsement on any Mortgage Note or Assignment of Mortgage and
shall
continue throughout the term of this Agreement. Upon the discovery by any
of the
Sponsor, the Depositor, the Securities Administrator, the Trustee, the
Master
Servicer or the Servicer of a breach of any of the Sponsor’s representations and
warranties set forth in Section 4 of the Purchase Agreement, the party
discovering the breach shall give prompt written notice to the others.
Within
30 days of the earlier of either discovery by or notice to the Sponsor of
any breach of any of the foregoing representations or warranties that materially
and adversely affects the value of any Mortgage Loan or the interest of
the
Trustee or the Certificateholders therein, the Sponsor shall use its best
efforts to cure such breach in all material respects and, if such defect
or
breach cannot be remedied, the Sponsor shall, at the Depositor’s instructions as
specified in writing and provided to the Sponsor and the Trustee, (i) if
such 30-day period expires prior to the second anniversary of the Closing
Date,
remove such Mortgage Loan from the Trust Fund and substitute in its place
a
Substitute Mortgage Loan, in the same manner and subject to the same conditions
set forth in this Section 2.03 that apply to repurchases or substitutions
of Mortgage Loans by the Originator or (ii) repurchase such Mortgage Loan
at the Repurchase Price; provided,
however,
that
any such substitution pursuant to clause (i) above shall not be
effected prior to the delivery to the Custodian of a Request for Release
substantially in the form of Exhibit J, and the delivery of the Mortgage
File to the Custodian for any such Substitute Mortgage Loan. In the event
of any
such repurchase or substitution of a Mortgage Loan by the Sponsor, the
procedures set forth in Sections 2.03(e), (f), (g), (h), (i) and (j) shall
apply
to the Sponsor in the same manner and to the same extent that they are
applicable to the Originator. It is understood and agreed that the obligations
of the Sponsor under this Agreement to cure, repurchase or substitute any
Mortgage Loan as to which a breach of a representation and warranty has
occurred
and is continuing, together with any related indemnification obligations
of the
Sponsor set forth in Section 2.03(h), shall constitute the sole remedies
against
the Sponsor available to the Certificateholders, the Depositor and any
of its
affiliates, or the Trustee on their behalf.
-56-
The
provisions of this Section 2.03 shall survive delivery of the respective
Custodial Files to the Custodian for the benefit of the
Certificateholders.
Section
2.04 Execution
and Delivery of Certificates. The Trustee acknowledges the transfer and
assignment to it of the Trust Fund and, concurrently with such transfer
and
assignment, the Securities Administrator has executed and delivered to,
or upon
the order of the Depositor, the Certificates in authorized denominations
evidencing directly or indirectly the entire ownership of the Trust Fund.
The
Trustee agrees to hold the Trust Fund and exercise the rights referred
to above
for the benefit of all present and future Holders of the
Certificates.
Section
2.05 REMIC
Matters. The Preliminary Statement sets forth the designations for federal
income tax purposes of all interests created hereby. The “Startup
Day”
for
purposes of the REMIC Provisions shall be the Closing Date. The “latest
possible maturity date”
is
the
Distribution Date occurring three years after the month in which the latest
Mortgage Loan maturity date (of the Mortgage Loans held in the Trust on
the
Closing Date) occurs.
-57-
Section
2.06 Representations
and Warranties of the Depositor. The Depositor hereby represents, warrants
and covenants to the other parties to this agreement that as of the date
of this
Agreement or as of such date specifically provided herein:
(a) The
Depositor is a corporation duly organized, validly existing and in good
standing
under the laws of the State of Delaware;
(b) The
Depositor has the power and authority to convey the Mortgage Loans and
to
execute, deliver and perform, and to enter into and consummate transactions
contemplated by, this Agreement;
(c) This
Agreement has been duly and validly authorized, executed and delivered
by the
Depositor, all requisite company action having been taken, and, assuming
the due
authorization, execution and delivery hereof by the other parties hereto,
constitutes or will constitute the legal, valid and binding agreement of
the
Depositor, enforceable against the Depositor in accordance with its terms,
except as such enforcement may be limited by bankruptcy, insolvency,
reorganization, moratorium or other similar laws relating to or affecting
the
rights of creditors generally, and by general equity principles (regardless
of
whether such enforcement is considered in a proceeding in equity or at
law);
(d) No
consent, approval, authorization or order of, or registration or filing
with, or
notice to, any governmental authority or court is required for the execution,
delivery and performance of or compliance by the Depositor with this Agreement
or the consummation by the Depositor of any of the transactions contemplated
hereby, except as have been received or obtained on or prior to the Closing
Date;
(e) None
of
the execution and delivery of this Agreement, the consummation of the
transactions contemplated hereby or thereby, or the fulfillment of or compliance
with the terms and conditions of this Agreement, (i) conflicts or will
conflict with or results or will result in a breach of, or constitutes
or will
constitute a default or results or will result in an acceleration under
(A) the charter or bylaws of the Depositor, or (B) of any term,
condition or provision of any material indenture, deed of trust, contract
or
other agreement or instrument to which the Depositor or any of its subsidiaries
is a party or by which it or any of its subsidiaries is bound; (ii) results
or will result in a violation of any law, rule, regulation, order, judgment
or
decree applicable to the Depositor of any court or governmental authority
having
jurisdiction over the Depositor or its subsidiaries; or (iii) results in
the creation or imposition of any lien, charge or encumbrance which would
have a
material adverse effect upon the Mortgage Loans or any documents or instruments
evidencing or securing the Mortgage Loans;
(f) There
are
no actions, suits or proceedings before or against or investigations of,
the
Depositor pending, or to the knowledge of the Depositor, threatened, before
any
court, administrative agency or other tribunal, and no notice of any such
action, which, in the Depositor’s reasonable judgment, might materially and
adversely affect the performance by the Depositor of its obligations under
this
Agreement, or the validity or enforceability of this Agreement;
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(g) The
Depositor is not in default with respect to any order or decree of any
court or
any order, regulation or demand of any federal, state, municipal or governmental
agency that would materially and adversely affect its performance hereunder;
and
(h) Immediately
prior to the transfer and assignment by the Depositor to the Trustee on
the
Closing Date, the Depositor had good title to, and was the sole owner of
each
Mortgage Loan, free of any interest of any other Person, and the Depositor
has
transferred all right, title and interest in each Mortgage Loan to the
Trustee.
The transfer of the Mortgage Note and the Mortgage as and in the manner
contemplated by this Agreement is sufficient either (i) fully to transfer
to the Trustee, for the benefit of the Certificateholders, all right, title,
and
interest of the Depositor thereto as note holder and mortgagee or (ii) to
grant to the Trustee, for the benefit of the Certificateholders, the security
interest referred to in Section 12.04.
It
is
understood and agreed that the representations, warranties and covenants
set
forth in this Section 2.06 shall survive delivery of the respective
Mortgage Files to the Custodian and shall inure to the benefit of the
Trustee.
ARTICLE
III
ADMINISTRATION
AND SERVICING
OF
MORTGAGE LOANS
Section
3.01 Servicer
to Service Mortgage Loans. (a) For and on behalf of the
Certificateholders, the Servicer shall service and administer the Mortgage
Loans
in accordance with the terms of this Agreement and the respective Mortgage
Loans
and, to the extent consistent with such terms, in accordance with Accepted
Servicing Practices, but without regard to:
(i) any
relationship that the Servicer, any Subservicer or any Affiliate of the
Servicer
or any Subservicer may have with the related Mortgagor;
(ii) the
ownership or non-ownership of any Certificate by the Servicer or any Affiliate
of the Servicer;
(iii) the
Servicer’s obligation to make P&I Advances or Servicing Advances;
or
(iv) the
Servicer’s or any Subservicer’s right to receive compensation for its services
hereunder or with respect to any particular transaction.
To
the
extent consistent with the foregoing, the Servicer shall seek to maximize
the
timely and complete recovery of principal and interest on the Mortgage
Notes.
Subject only to the above-described servicing standards and the terms of
this
Agreement and of the respective Mortgage Loans, the Servicer shall have
full
power and authority, acting alone or through Subservicers as provided in
Section 3.02, to do or cause to be done any and all things in connection
with such servicing and administration which it may deem necessary or desirable.
Without limiting the generality of the foregoing, the Servicer in its own
name
or in the name of a Subservicer is hereby authorized and empowered by the
Trustee when the Servicer believes it appropriate in its best judgment
in
accordance with Accepted Servicing Practices to execute and deliver any
and all
instruments of satisfaction or cancellation, or of partial or full release
or
discharge, and all other comparable instruments, with respect to the Mortgage
Loans and the Mortgaged Properties and to institute foreclosure proceedings
or
obtain a deed-in-lieu of foreclosure so as to convert the ownership of
such
properties, and to hold or cause to be held title to such properties, on
behalf
of the Trustee; provided,
further,
that
upon the full release and discharge, the Servicer shall notify the Custodian
of
the Mortgage Loan of any such full release or discharge with respect to
the
Mortgage Loan and related Mortgage Properties. The Servicer shall at its
own
expense be responsible for preparing and recording all lien releases and
mortgage satisfactions in accordance with state and local regulations.
The
Servicer shall service and administer the Mortgage Loans in accordance
with
applicable state and federal law and shall provide to the Mortgagors any
reports
required to be provided to them thereby. The Servicer shall also comply
in the
performance of this Agreement with all reasonable rules and requirements
of each
insurer under any standard hazard insurance policy or any Primary Mortgage
Insurance Policy (if applicable). Subject to Section 3.16, the Trustee
shall execute, at the written request of the Servicer, and furnish to the
Servicer and any Subservicer such documents provided to the Trustee as
are
necessary or appropriate to enable the Servicer or any Subservicer to carry
out
their servicing and administrative duties hereunder, and the Trustee hereby
grants to the Servicer, and this Agreement shall constitute a limited power
of
attorney to carry out such duties including a power of attorney to take
title to
Mortgaged Properties after foreclosure on behalf of the Trustee. The Trustee
shall execute a separate power of attorney, furnished to it by the Servicer,
in
favor of the Servicer for the purposes described herein, to the extent
necessary
or desirable to enable the Servicer to perform its duties hereunder. The
Trustee
shall not be liable for the actions of the Servicer or any Subservicers
under
such powers of attorney. Notwithstanding anything contained herein to the
contrary, no Servicer or Subservicer shall without the Trustee’s consent: (i)
initiate any action, suit or proceeding solely under the Trustee’s name without
indicating the Servicer’s or Subservicer’s, as applicable, representative
capacity, or (ii) knowingly take any action with the intent to, or which
actually does cause, the Trustee to be registered to do business in any
state.
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(b) Subject
to Section 3.09, in accordance with the standards of the preceding
paragraph, the Servicer shall advance or cause to be advanced funds as
necessary
for the purpose of effecting the timely payment of taxes and assessments
on the
Mortgaged Properties, which advances shall be Servicing Advances reimbursable
in
the first instance from the collection from the Mortgagors pursuant to
Section 3.09, and further as provided in Section 3.11. Any cost
incurred by the Servicer or by Subservicers in effecting the timely payment
of
taxes and assessments on a Mortgaged Property shall not be added to the
unpaid
principal balance of the related Mortgage Loan, notwithstanding that the
terms
of such Mortgage Loan so permit.
(c) Notwithstanding
anything in this Agreement to the contrary, the Servicer may not make any
future
advances with respect to a Mortgage Loan (except as provided in
Section 4.01) and the Servicer shall not, except as provided in Section
3.07(a), (i) permit any modification with respect to any Mortgage Loan that
would change the Mortgage Rate, reduce or increase the principal balance
(except
for reductions resulting from actual payments of principal) or change the
final
maturity date on such Mortgage Loan (except for a reduction of interest
payments
resulting from the application of the Servicemembers Civil Relief Act or
any
similar state statutes) or (ii) permit any modification, waiver or
amendment of any term of any Mortgage Loan that would both (A) effect an
exchange or reissuance of such Mortgage Loan under Section 1001 of the Code
(or final, temporary or proposed Treasury regulations promulgated thereunder)
and (B) cause any REMIC formed hereby to fail to qualify as a REMIC under
the Code or the imposition of any tax on “prohibited transactions” or
“contributions after the startup day” under the REMIC Provisions or (iii) waive
any Prepayment Charges.
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(d) The
Servicer may delegate its responsibilities under this Agreement; provided,
however,
that no
such delegation shall release the Servicer from the responsibilities or
liabilities arising under this Agreement.
Section
3.02 Subservicing
Agreements between Servicer and Subservicers; Use of Subcontractors. (a) The
Servicer may enter into a subservicing agreement with a Subservicer, for
the
servicing and administration of the Mortgage Loans (“Subservicing
Agreement”)
without obtaining the prior consent of the Trustee, the Depositor, the
Master
Servicer, the Securities Administrator or other parties hereto to the
utilization of any such Subservicer, provided the provisions of such
Subservicing Agreement comply with the requirements set forth in this Section
3.02. None of the Trustee, the Securities Administrator, the Master Servicer
or
the Depositor shall be required to review or consent to such Subservicing
Agreement and none shall have any liability in connection
therewith.
(b) Each
Subservicer shall be (i) authorized to transact business in the state or
states in which the related Mortgaged Properties it is to service are situated,
if and to the extent required by applicable law to enable the Subservicer
to
perform its obligations hereunder and under the Subservicing Agreement
and (ii)
a ▇▇▇▇▇▇▇ Mac or ▇▇▇▇▇▇ Mae approved mortgage servicer. Each Subservicing
Agreement must impose on the Subservicer requirements conforming to the
provisions set forth in Sections 3.08, 3.22, 3.23, 3.24, 3.29, 6.05, 6.06,
7.01(i), 8.12 and Exhibit S of this Agreement to the same extent as if
such
Subservicer were the Servicer and otherwise provide for servicing of the
Mortgage Loans consistent with the terms of this Agreement. The Servicer
shall
examine each Subservicing Agreement and will be familiar with the terms
thereof
in order to determine that the foregoing requirements have been incorporated
into the Subservicing Agreement and that the terms thereof are not otherwise
inconsistent with any of the provisions of this Agreement. The Servicer
and the
Subservicers may enter into and make amendments to the Subservicing Agreements
or enter into different forms of Subservicing Agreements; provided,
however,
that
any such amendments or different forms shall be consistent with and not
violate
the provisions of this Agreement, and that no such amendment or different
form
shall be made or entered into which could be reasonably expected to have
a
materially adverse effect on the interests of the Trustee, the Depositor,
the
Master Servicer or the Securities Administrator without their prior written
consent. Any variation without the consent of the Trustee, the Depositor,
the
Securities Administrator and the Master Servicer from the requirements
set forth
in Sections 3.08, 3.22, 3.23, 3.24, 3.29, 6.05, 6.06, 7.01(i), 8.12 and
Exhibit S, are conclusively deemed to be inconsistent with this Agreement
and
therefore prohibited. The Servicer shall deliver to the Master Servicer,
the
Securities Administrator, the Trustee and the Depositor copies of all
Subservicing Agreements, and any amendments or modifications thereof, promptly
upon the Servicer’s execution and delivery of such instruments.
(c) As
part
of its servicing activities hereunder, the Servicer (except as otherwise
provided in the last sentence of this paragraph) shall enforce the obligations
of each Subservicer under the related Subservicing Agreement, including,
without
limitation, (i) any obligation to make advances in respect of delinquent
payments as required by a Subservicing Agreement and (ii) the reporting
obligations set forth under Section 3.22, 3.23, 3.24 and 3.29 hereof to
the same
extent as if such Subservicer were the Servicer. The Servicer shall be
responsible for obtaining from each Subservicer and delivering to the Master
Servicer, the Securities Administrator and the Depositor (i) any servicer
annual
compliance statement required to be delivered by such Subservicer under
Section
3.24(b); (ii) any report on assessments and attestations of compliance
with
Relevant Servicing Criteria required to be delivered by the Subservicer
pursuant
to Sections 3.22 and 3.23; and (iii) any certifications required to be
delivered
under Section 3.24(a) to the Master Servicer or such other Person that
will be
responsible for signing the ▇▇▇▇▇▇▇▇-▇▇▇▇▇ Certification as and where required
to be delivered hereunder. Such enforcement, including, without limitation,
the
legal prosecution of claims, termination of Subservicing Agreements, and
the
pursuit of other appropriate remedies, shall be in such form and carried
out to
such an extent and at such time as the Servicer, in its good faith business
judgment, would require were it the owner of the related Mortgage Loans.
The
Servicer shall pay the costs of such enforcement at its own expense, and
shall
be reimbursed therefor only (i) from a general recovery resulting from such
enforcement, to the extent, if any, that such recovery exceeds all amounts
due
in respect of the related Mortgage Loans or (ii) from a specific recovery
of costs, expenses or attorneys’ fees against the party against whom such
enforcement is directed.
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(d) It
shall
not be necessary for the Servicer to seek the consent of the Depositor,
the
Trustee, the Master Servicer, the Securities Administrator or other parties
hereto to the utilization of a Subcontractor. The Servicer shall give prompt
written notice to the Master Servicer, the Securities Administrator and
the
Depositor of the appointment of any Servicing Function Participant and
provide a
written description (in form and substance satisfactory to the Depositor)
of the
role and function of each Servicing Function Participant specifying which
elements of the Servicing Criteria set forth under Item 1122(d) of Regulation
AB
will be addressed in assessments and attestations of compliance with Relevant
Servicing Criteria provided by such Servicing Function Participant.
(e) As
a
condition to the utilization of any Subcontractor determined to be a Servicing
Function Participant, the Servicer shall cause any such Subcontractor used
by
the Servicer (or by any Subservicer) to comply with the provisions of Sections
3.22, 3.23, 3.24, 3.29, 6.05, 6.06, 7.01(i), 8.12 and Exhibit S of this
Agreement to the same extent as if such Subcontractor were the Servicer.
The
Servicer shall be responsible for obtaining from each Subcontractor and
delivering to the Securities Administrator, the Master Servicer and the
Depositor any assessments and attestations of compliance required to be
delivered by such Subcontractor pursuant to Sections 3.22 and 3.23, in
each case
as and when required to be delivered.
Section
3.03 Successor
Subservicers. The Servicer shall be entitled to terminate any Subservicing
Agreement and the rights and obligations of any Subservicer pursuant to
any
Subservicing Agreement in accordance with the terms and conditions of such
Subservicing Agreement. In the event of termination of any Subservicer,
all
servicing obligations of such Subservicer shall be assumed simultaneously
by the
Servicer without any act or deed on the part of such Subservicer or Servicer,
and the Servicer either shall service directly the related Mortgage Loans
or
shall enter into a Subservicing Agreement with a successor subservicer
which
qualifies under Section 3.02.
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Any
Subservicing Agreement shall include the provision that such agreement
may be
immediately terminated by the Master Servicer without fee, in accordance
with
the terms of this Agreement, in the event that the Servicer shall, for
any
reason, no longer be the Servicer (including termination due to an Event
of
Default).
Section
3.04 Liability
of the Servicer. Notwithstanding any subservicing agreement or the
provisions of this Agreement relating to agreements or arrangements between
the
Servicer and a Subservicer, Subcontractor or other third party or reference
to
actions taken through a Subservicer, a Subcontractor, another third party
or
otherwise, the Servicer shall remain obligated and primarily liable to
the
Trustee and the Trust Fund for the servicing and administering of the Mortgage
Loans in accordance with the provisions hereof without diminution of such
obligation or liability by virtue of any subservicing, subcontracting or
other
agreements or arrangements or by virtue of indemnification from a Subservicer,
Subcontractor or a third party and to the same extent and under the same
terms
and conditions as if the Servicer alone were servicing the Mortgage Loans,
including with respect to compliance with Item 1122 of Regulation AB. The
Servicer shall be entitled to enter into any agreement with a Subservicer,
Subcontractor or other third party for indemnification of the Servicer
by such
Subservicer, Subcontractor or third party and nothing contained in the
Agreement
shall be deemed to limit or modify such indemnification.
Section
3.05 No
Contractual Relationship between Subservicers and the Master Servicer. Any
Subservicing Agreement that may be entered into and any transactions or
services
relating to the Mortgage Loans involving a Subservicer in its capacity
as such
shall be deemed to be between the Subservicer and the Servicer alone, and
none
of the Trustee, the Depositor, the Securities Administrator, or the Master
Servicer (nor any successor master servicer) shall be deemed a party thereto
and
shall have no claims, rights, obligations, duties or liabilities with respect
to
the Subservicer except as set forth in Section 3.06. The Servicer shall be
solely liable for all fees owed by it to any Subservicer, irrespective
of
whether the Servicer’s compensation pursuant to this Agreement is sufficient to
pay such fees.
Section
3.06 Assumption
or Termination of Subservicing Agreements by Master Servicer. In the event
the Servicer at any time shall for any reason no longer be the Servicer
(including by reason of the occurrence of an Event of Default), the Master
Servicer (or, if the Master Servicer and the Servicer are the same entity,
the
Trustee (as successor master servicer)), or other successor servicer, shall
thereupon assume all of the rights and obligations of the Servicer under
each
Subservicing Agreement that the Servicer may have entered into, with copies
thereof provided to the Master Servicer, the Trustee (as successor master
servicer) or other successor servicer, as applicable, prior to such party
assuming such rights and obligations, unless such party elects to terminate
any
Subservicing Agreement in accordance with its terms as provided in
Section 3.03.
Upon
such
assumption, the Master Servicer, the Trustee (as successor master servicer)
or
other successor servicer, as applicable, shall be deemed, subject to
Section 3.03, to have assumed all of the Servicer’s interest therein and to
have replaced the Servicer as a party to each Subservicing Agreement to
the same
extent as if each Subservicing Agreement had been assigned to the assuming
party, except that (i) the Servicer shall not thereby be relieved of any
liability or obligations under any Subservicing Agreement that arose before
it
ceased to be the Servicer and (ii) none of the Trustee, the Depositor, the
Master Servicer, the Securities Administrator, their designees or any successor
servicer shall be deemed to have assumed any liability or obligation of
the
Servicer that arose before it ceased to be the Servicer.
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The
Servicer at its expense shall, upon request of the Master Servicer, or
other
successor servicer, as applicable, deliver to the assuming party all documents
and records relating to the Subservicing Agreement and the Mortgage Loans
then
being serviced and an accounting of amounts collected and held by or on
behalf
of it, and otherwise use its best efforts to effect the orderly and efficient
transfer of the Subservicing Agreements to the assuming party.
Section
3.07 Collection
of Certain Mortgage Loan Payments. (a) The Servicer shall make
reasonable efforts to collect all payments called for under the terms and
provisions of the Mortgage Loans, and shall, to the extent such procedures
shall
be consistent with this Agreement and the terms and provisions of any applicable
Insurance Policies, follow such collection procedures as it would follow
with
respect to mortgage loans comparable to the Mortgage Loans and held for
its own
account. Consistent with the foregoing and Accepted Servicing Practices,
the
Servicer may (i) waive any late payment charge or, if applicable, any
penalty interest, or (ii) extend the due dates for the Scheduled Payments
due on a Mortgage Note for a period of not greater than 180 days;
provided,
that
any extension pursuant to clause (ii) above shall not affect the
amortization schedule of any Mortgage Loan for purposes of any computation
hereunder, except as provided below. In the event of any such arrangement
pursuant to clause (ii) above, the Servicer shall make timely advances
on such Mortgage Loan during such extension pursuant to Section 4.01 and in
accordance with the amortization schedule of such Mortgage Loan without
modification thereof by reason of such arrangements, subject to
Section 4.01(d) pursuant to which the Servicer shall not be required to
make any such advances that are Nonrecoverable P&I Advances. Notwithstanding
the foregoing, in the event that any Mortgage Loan is in default, or in
the
judgment of the Servicer such default is reasonably foreseeable, the Servicer,
consistent with the standards set forth in Section 3.01, may also waive,
modify or vary any term of such Mortgage Loan (including, but not limited
to,
modifications that would change the Mortgage Rate, forgive the payment
of
principal or interest, extend the final maturity date of such Mortgage
Loan or
waive, in whole or in part, a Prepayment Charge), accept payment from the
related Mortgagor of an amount less than the Stated Principal Balance in
final
satisfaction of such Mortgage Loan, or consent to the postponement of strict
compliance with any such term or otherwise grant indulgence to any Mortgagor
(any and all such waivers, modifications, variances, forgiveness of principal
or
interest, postponements, or indulgences collectively referred to herein
as
“Forbearance”);
provided,
however,
that
the final maturity date of any Mortgage Loan may not be extended beyond
the
Final Scheduled Distribution Date for the LIBOR Certificates. The Servicer’s
analysis supporting any Forbearance and the conclusion that any Forbearance
meets the standards of Section 3.01 shall be reflected in writing in the
Servicing File or on the Servicer’s servicing records. In addition,
notwithstanding the foregoing, the Servicer may also waive (or permit a
Subservicer to waive), in whole or in part, a Prepayment Charge if such
waiver
would, in the Servicer’s judgment, maximize recoveries on the related Mortgage
Loan or if such Prepayment Charge is (i) not permitted to be collected by
applicable law, or the collection of the Prepayment Charge would be considered
“predatory” pursuant to written guidance published by any applicable federal,
state or local regulatory authority having jurisdiction over such matters,
or
(ii) the enforceability of such Prepayment Charge is limited (1) by
bankruptcy, insolvency, moratorium, receivership or other similar laws
relating
to creditors’ rights or (2) due to acceleration in connection with a
foreclosure or other involuntary payment. If a Prepayment Charge is waived
other
than as permitted in this Section 3.07(a), then the Servicer is required to
pay the amount of such waived Prepayment Charge, for the benefit of the
Holders
of the Class P Certificates, by depositing such amount into the Collection
Account together with and at the time that the amount prepaid on the related
Mortgage Loan is required to be deposited into the Collection Account;
provided,
however,
that
the Servicer shall not have an obligation to pay the amount of any uncollected
Prepayment Charge if the failure to collect such amount is the direct result
of
inaccurate or incomplete information on the Mortgage Loan Schedule in effect
at
such time. The Master Servicer shall have no responsibility for verifying
the
accuracy of the amount of Prepayment Charges waived or remitted by the
Servicer.
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(b) (i) The
Securities Administrator shall establish and maintain the Excess Reserve
Fund
Account as an asset of the Supplemental Interest Trust, on behalf of the
Class X Certificateholders, to receive any Basis Risk Payment and to secure
their limited recourse obligation to pay to the LIBOR Certificateholders
any
Basis Risk Carryover Amounts. The Excess Reserve Fund Account shall be
funded on
the Closing Date with an initial deposit of $1,000 by the
Depositor.
(ii) On
each
Distribution Date, the Securities Administrator shall deposit the amount
of any
Basis Risk Payment for such date into the Excess Reserve Fund
Account.
(c) (i) On
each
Distribution Date on which there exists a Basis Risk Carryover Amount on
any
Class of LIBOR Certificates, the Securities Administrator shall
(1) withdraw from the Distribution Account and deposit in the Excess
Reserve Fund Account, as set forth in Section 4.02(a)(iii)(D), the lesser
of (x) the Class X Distributable Amount (without regard to the
reduction in the definition thereof with respect to the Basis Risk Payment
(to
the extent remaining after the distributions specified in
Sections 4.02(a)(iii)(A)
through (H)) and (y) the aggregate Basis Risk Carryover Amounts for such
Distribution Date and (2) withdraw from the Excess Reserve Fund Account
amounts necessary to pay to such Class or Classes of LIBOR Certificates the
applicable Basis Risk Carryover Amount. Such payments shall be allocated
to
those Classes on a pro rata
basis
based upon the amount of Basis Risk Carryover Amount owed to each such
Class and shall be paid in the priority set forth in
Sections 4.02(a)(iii)(E).
(ii) [Reserved].
(iii) Any
Basis
Risk Carryover Amounts paid by the Securities Administrator to the LIBOR
Certificateholders shall be accounted for by the Securities Administrator
as
amounts paid first to the Holders of the Class X Certificates and then to
the respective Class or Classes of LIBOR Certificates. In addition, the
Securities Administrator shall account for such Certificateholders’ rights to
receive payments of Basis Risk Carryover Amounts as rights in a limited
recourse
notional principal contract written by the Class X Certificateholders in
favor of such Certificateholders.
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(iv) Notwithstanding
any provision contained in this Agreement, the Securities Administrator
shall
not be required to make any payments to and from the Excess Reserve Fund
Account
except as expressly set forth in this Section 3.07(c) and
Sections 4.02(a)(iii)(D) and (E).
(d) The
Securities Administrator shall establish and maintain the Distribution
Account
on behalf of the Certificateholders. The Master Servicer shall, promptly
upon
receipt, deposit in the Distribution Account and retain therein the
following:
(i) the
aggregate amount remitted by the Servicer to the Master Servicer pursuant
to
Section 3.11;
(ii) any
amount deposited by the Servicer pursuant to Section 3.12(b) in connection
with any losses on Permitted Investments; and
(iii) any
other
amounts deposited hereunder which are required to be deposited in the
Distribution Account.
In
the
event that the Servicer shall remit any amount not required to be remitted,
it
may at any time direct the Securities Administrator in writing to withdraw
such
amount from the Distribution Account, any provision herein to the contrary
notwithstanding. Such direction may be accomplished by delivering notice
to the
Securities Administrator which describes the amounts deposited in error
in the
Distribution Account. All funds deposited in the Distribution Account shall
be
held by the Securities Administrator in trust for the Certificateholders
until
disbursed in accordance with this Agreement or withdrawn in accordance
with
Section 4.02.
(e) The
Securities Administrator may invest the funds in the Distribution Account
during
the Securities Administrator Float Period in one or more Permitted Investments
in accordance with Section 3.12. The Securities Administrator may withdraw
from the Distribution Account any income or gain earned from the investment
of
funds deposited therein for its own benefit.
Section
3.08 Subservicing
Accounts. In those cases where a Subservicer is servicing a Mortgage Loan
pursuant to a Subservicing Agreement, the Subservicer will be required
to
establish and maintain one or more segregated accounts (collectively, the
“Subservicing
Account”).
The
Subservicing Account shall be an Eligible Account and shall otherwise be
acceptable to the Servicer. The Subservicer shall deposit in the clearing
account (which account must be an Eligible Account) in which it customarily
deposits payments and collections on mortgage loans in connection with
its
mortgage loan servicing activities on a daily basis, and in no event more
than
one Business Day after the Subservicer’s receipt thereof, all proceeds of
Mortgage Loans received by the Subservicer less its servicing compensation
to
the extent permitted by the Subservicing Agreement, and shall thereafter
deposit
such amounts in the Subservicing Account, in no event more than two Business
Days after the deposit of such funds into the clearing account. The Subservicer
shall thereafter deposit such proceeds in the Collection Account or remit
such
proceeds to the Servicer for deposit in the Collection Account not later
than
two Business Days after the deposit of such amounts in the Subservicing
Account.
For purposes of this Agreement, the Servicer shall be deemed to have received
payments on the Mortgage Loans when the Subservicer receives such payments.
Funds in the clearing account and any Subservicing Account may, in the
discretion of the Servicer, be invested in Permitted Investments pending
their
deposit into the Subservicing Account and the Collection Account, respectively;
provided,
however,
the
Servicer shall be responsible for any losses incurred on such investments
immediately upon realization.
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Section
3.09 Collection
of Taxes, Assessments and Similar Items; Escrow Accounts.
To
the
extent the related Mortgage provides for Escrow Payments, the Servicer
shall
establish and maintain, or cause to be established and maintained, one
or more
segregated accounts (the “Escrow
Accounts”),
which
shall be Eligible Accounts. The Servicer shall deposit in the clearing
account
(which account must be an Eligible Account) in which it customarily deposits
payments and collections on mortgage loans in connection with its mortgage
loan
servicing activities on a daily basis, and in no event more than one Business
Day after the Servicer’s receipt thereof, all collections from the Mortgagors
(or related advances from Subservicers) for the payment of taxes, assessments,
hazard insurance premiums and comparable items for the account of the Mortgagors
(“Escrow
Payments”)
collected on account of the Mortgage Loans and shall thereafter deposit
such
Escrow Payments in the Escrow Accounts, in no event more than two Business
Days
after the deposit of such funds in the clearing account, for the purpose
of
effecting the payment of any such items as required under the terms of
this
Agreement. Withdrawals of amounts from an Escrow Account may be made only
to
(i) effect payment of taxes, assessments, hazard insurance premiums, and
comparable items; (ii) reimburse the Servicer (or a Subservicer to the
extent provided in the related Subservicing Agreement) out of the collection
for
any advances made pursuant to Section 3.01 (with respect to taxes and
assessments) and Section 3.13 (with respect to hazard insurance);
(iii) refund to Mortgagors any sums as may be determined to be overages;
(iv) pay interest, if required and as described below, to Mortgagors on
balances in the Escrow Account; (v) clear and terminate the Escrow Account
at the termination of the Servicer’s obligations and responsibilities in respect
of the Mortgage Loans under this Agreement; or (vi) recover amounts
deposited in error. As part of its servicing duties, the Servicer or
Subservicers shall pay to the Mortgagors interest on funds in Escrow Accounts,
to the extent required by law and, to the extent that interest earned on
funds
in the Escrow Accounts is insufficient, to pay such interest from its or
their
own funds, without any reimbursement therefor. To the extent that a Mortgage
does not provide for Escrow Payments, the Servicer shall determine whether
any
such payments are made by the Mortgagor in a manner and at a time that
avoids
the loss of the Mortgaged Property due to a tax sale or the foreclosure
of a tax
lien. The Servicer assumes full responsibility for the payment of all such
bills
within such time and shall effect payments of all such bills irrespective
of the
Mortgagor’s faithful performance in the payment of same or the making of the
Escrow Payments and shall make advances from its own funds to effect such
payments; provided,
however,
that
such advances are deemed to be Servicing Advances.
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Section
3.10 Collection
Account. (a) On behalf of the Trust, the Servicer shall establish
and maintain, or cause to be established and maintained, one or more
segregated
Eligible Accounts (such account or accounts, the “Collection
Account”),
held
in trust for the benefit of the Trustee. On behalf of the Trust, the
Servicer
shall deposit or cause to be deposited in the clearing account (which
account
must be an Eligible Account) in which it customarily deposits payments
and
collections on mortgage loans in connection with its mortgage loan servicing
activities on a daily basis, and in no event more than one Business Day
after
the Servicer’s receipt thereof, and shall thereafter deposit into the Collection
Account, in no event more than two Business Days after the deposit of
such funds
into the clearing account, as and when received or as otherwise required
hereunder, the following payments and collections received or made by
it
subsequent to the Cut-off Date (other than in respect of principal or
interest
on the related Mortgage Loans due on or before the Cut-off Date), or
payments
(other than Principal Prepayments) received by it on or prior to the
Cut-off
Date but allocable to a Due Period subsequent thereto:
(i) all
payments on account of principal, including Principal Prepayments, on the
Mortgage Loans;
(ii) all
payments on account of interest (net of the related Servicing Fee) on each
Mortgage Loan;
(iii) all
Insurance Proceeds and Condemnation Proceeds to the extent such Insurance
Proceeds and Condemnation Proceeds are not to be applied to the restoration
of
the related Mortgaged Property or released to the related Mortgagor in
accordance with the express requirements of law or in accordance with Accepted
Servicing Practices, Liquidation Proceeds and Subsequent
Recoveries;
(iv) any
amounts required to be deposited pursuant to Section 3.12 in connection
with any losses realized on Permitted Investments with respect to funds
held in
the Collection Account;
(v) any
amounts required to be deposited by the Servicer pursuant to the second
paragraph of Section 3.13(a) in respect of any blanket policy
deductibles;
(vi) all
proceeds of any Mortgage Loan repurchased or purchased in accordance with
this
Agreement; and
(vii) all
Prepayment Charges collected by the Servicer.
The
foregoing requirements for deposit in the Collection Account shall be exclusive,
it being understood and agreed that, without limiting the generality of
the
foregoing, payments in the nature of late payment charges, NSF fees,
reconveyance fees, assumption fees and other similar fees and charges need
not
be deposited by the Servicer in the Collection Account and shall, upon
collection, belong to the Servicer as additional compensation for its servicing
activities. In the event the Servicer shall deposit in the Collection Account
any amount not required to be deposited therein, it may at any time withdraw
such amount from the Collection Account, any provision herein to the contrary
notwithstanding.
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(b) Funds
in
the Collection Account may be invested in Permitted Investments in accordance
with the provisions set forth in Section 3.12. The Servicer shall give
notice to the Securities Administrator and the Master Servicer of the location
of the Collection Account maintained by it when established and prior to
any
change thereof.
Section
3.11 Withdrawals
from the Collection Account. (a) The Servicer shall, from time to time,
make withdrawals from the Collection Account maintained by it for any of
the
following purposes or as described in Section 4.01:
(i) on
or
prior to each Remittance Date, to remit to the Master Servicer all Available
Funds in respect of the related Distribution Date together with all amounts
representing Prepayment Charges (payable to the Class P Certificateholders)
from the Mortgage Loans received during the related Prepayment
Period;
(ii) to
reimburse the Servicer for (A) P&I Advances, but only to the extent of
amounts received which represent Late Collections (net of the related Servicing
Fees) of Scheduled Payments on Mortgage Loans with respect to which such
P&I
Advances were made by the Servicer in accordance with the provisions of
Section 4.01 and (B) any ▇▇▇▇▇▇▇▇▇▇▇▇ ▇&▇ Advances to the extent of
funds held in the Collection Account for a future Distribution Date that
were
not included in Available Funds for the preceding Distribution
Date;
(iii) to
pay
the Servicer or any Subservicer (A) any unpaid Servicing Fees or
(B) any unreimbursed Servicing Advances with respect to each Mortgage Loan,
but only to the extent of any Late Collections or other amounts as may
be
collected by the Servicer from a Mortgagor, or otherwise received with
respect
to such Mortgage Loan (or the related REO Property);
(iv) to
pay to
the Servicer as servicing compensation (in addition to the Servicing Fee)
on
each Remittance Date any interest or investment income earned on funds
deposited
in the Collection Account;
(v) to
pay to
the Originator, with respect to each Mortgage Loan that has previously
been
repurchased or replaced pursuant to this Agreement, all amounts received
thereon
subsequent to the date of purchase or substitution, as the case may
be;
(vi) to
reimburse the Servicer for (A) any P&I Advance or Servicing Advance
previously made which the Servicer has determined to be a Nonrecoverable
P&I
Advance or Nonrecoverable Servicing Advance in accordance with the provisions
of
Section 4.01 and (B) any unpaid Servicing Fees to the extent not
recoverable from Late Collections or other amounts received with respect
to the
related Mortgage Loan under Section 3.11(a)(iii);
(vii) to
pay,
or to reimburse the Servicer for Servicing Advances in respect of, expenses
incurred in connection with any Mortgage Loan pursuant to
Section 3.15;
(viii) to
reimburse the Master Servicer, the Servicer, the Depositor, the Securities
Administrator or the Trustee for expenses incurred by or reimbursable to
the
Master Servicer, the Servicer, the Depositor, the Securities Administrator
or
the Trustee, as the case may be, pursuant to Section 6.03,
Section 7.02, Section 8.05, Section 9.13 or
Section 10.02;
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(ix) to
reimburse the Master Servicer, the Servicer, the Securities Administrator
or the
Trustee, as the case may be, for expenses reasonably incurred in respect
of the
breach or defect giving rise to the repurchase obligation of the Originator
or
the Sponsor under this Agreement that were included in the Repurchase Price
of
the Mortgage Loan, including any expenses arising out of the enforcement
of the
repurchase obligation, to the extent not otherwise paid pursuant to the
terms
hereof;
(x) to
withdraw any amounts deposited in the Collection Account in error;
and
(xi) to
clear
and terminate the Collection Account upon termination of this
Agreement.
(b) The
Servicer shall keep and maintain separate accounting, on a Mortgage Loan
by
Mortgage Loan basis, for the purpose of justifying any withdrawal from
the
Collection Account, to the extent held by or on behalf of it, pursuant
to
subclauses (a)(ii), (iii), (v), (vi), (vii), (viii) and (ix) above.
The Servicer shall provide written notification (as set forth in
Section 4.01(d)) to the Master Servicer, on or prior to the next succeeding
Remittance Date, upon making any withdrawals from the Collection Account
pursuant to subclause (a)(vi) above.
Section
3.12 .
(a) The Servicer may invest the funds in the Collection Account
maintained by it and the Escrow Accounts (to the extent permitted by law
and the
related Mortgage Loan documents) and the Securities Administrator may invest
funds in the Distribution Account during the Securities Administrator’s Float
Period and shall invest such funds in the Distribution Account (for purposes
of
this Section 3.12, each such Account is referred to as an “Investment
Account”),
in
one or more Permitted Investments bearing interest or sold at a discount,
and
maturing, unless payable on demand, no later than the Business Day immediately
preceding the date on which such funds are required to be withdrawn from
such
account pursuant to this Agreement; provided,
however,
that
any such Permitted Investment managed by or advised by the Securities
Administrator or any of its Affiliates may mature, unless payable on demand,
no
later than the date on which such funds are required to be withdrawn from
such
account pursuant to this Agreement. All such Permitted Investments shall
be held
to maturity, unless payable on demand. Any investment of funds in an Investment
Account shall be made in the name of the Servicer or the Securities
Administrator, as applicable. The Servicer or the Securities Administrator,
as
applicable, shall be entitled to sole possession over each such investment,
and
any certificate or other instrument evidencing any such investment shall
be
delivered directly to the Servicer or the Securities Administrator or its
agent,
as applicable, together with any document of transfer necessary to transfer
title to such investment to the Servicer or the Securities Administrator
or its
agent, as applicable. In the event amounts on deposit in an Investment
Account
are at any time invested in a Permitted Investment payable on demand, the
Servicer or the Securities Administrator, as applicable, may:
|
(x)
|
consistent
with any notice required to be given thereunder, demand that
payment
thereon be made on the last day such Permitted Investment may
otherwise
mature hereunder in an amount equal to the lesser of (1) all amounts
then payable thereunder and (2) the amount required to be withdrawn
on such date; and
|
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|
(y)
|
demand
payment of all amounts due thereunder that such Permitted Investment
would
not constitute a Permitted Investment in respect of funds thereafter
on
deposit in an Investment Account.
|
(b) All
income and gain realized from the investment of funds deposited in the
Collection Account or Escrow Account, as applicable, held by or on behalf
of the
Servicer, shall be for the benefit of the Servicer and shall be subject
to its
withdrawal in the manner set forth in Section 3.11. The Servicer shall
deposit in the Collection Account or Escrow Account, as applicable, the
amount
of any loss of principal incurred in respect of any such Permitted Investment
made with funds in such accounts immediately upon realization of such
loss.
(c) All
income and gain realized from the investment of funds deposited in the
Distribution Account held by the Securities Administrator during the Securities
Administrator’s Float Period, shall be for the benefit of the Securities
Administrator, and shall be subject to the Securities Administrator’s withdrawal
in the manner set forth in Section 3.07(d). Notwithstanding anything in
this Section 3.12(c), the Securities Administrator shall be liable to the
Trust
for any such loss on any funds it has invested under this Section 3.12(c)
only
during the Securities Administrator Float Period, and the Securities
Administrator shall deposit in the Distribution Account the amount of any
loss
of principal incurred in respect of any such Permitted Investment made
with
funds in such account immediately upon realization of such loss.
(d) Except
as
otherwise expressly provided in this Agreement, if any default occurs in
the
making of a payment due under any Permitted Investment of funds held in
the
Escrow Account or any Collection Account, or if a default occurs in any
other
performance required under any Permitted Investment of funds held in the
Escrow
Account or any Collection Account, the Servicer or the Securities Administrator,
as applicable, shall take such action as may be appropriate to enforce
such
payment or performance, including the institution and prosecution of appropriate
proceedings.
(e) The
Securities Administrator or its Affiliates are permitted to receive additional
compensation that could be deemed to be in the Securities Administrator’s
economic self-interest for (i) serving as investment adviser,
administrator, shareholder, servicing agent, custodian or sub-custodian
with
respect to certain of the Permitted Investments, (ii) using Affiliates to
effect transactions in certain Permitted Investments and (iii) effecting
transactions in certain Permitted Investments. The Master Servicer or its
Affiliates are permitted to receive compensation that could be deemed to
be in
the Master Servicer’s economic self-interest for (i) serving as investment
adviser, administrator, shareholder, servicing agent, custodian or sub-custodian
with respect to certain of the Permitted Investments, (ii) using Affiliates
to effect transactions in certain Permitted Investments and (iii) effecting
transactions in certain Permitted Investments. Such compensation shall
not be
considered an amount that is reimbursable for payable pursuant to this
Agreement.
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Section
3.13 Maintenance
of Hazard Insurance and Errors and Omissions and Fidelity Coverage.
(a) The Servicer shall cause to be maintained for each Mortgage Loan
fire insurance with extended coverage on the related Mortgaged Property
in an
amount which is at least equal to the least of (i) the outstanding
principal balance of such Mortgage Loan, (ii) the amount necessary to fully
compensate for any damage or loss to the improvements that are a part of
such
property on a replacement cost basis and (iii) the maximum insurable value
of the improvements which are a part of such Mortgaged Property, in each
case in
an amount not less than such amount as is necessary to avoid the application
of
any coinsurance clause contained in the related hazard insurance policy.
The Servicer shall also cause to be maintained fire insurance with extended
coverage on each REO Property in an amount which is at least equal to the
lesser
of (i) the maximum insurable value of the improvements which are a part of
such property and (ii) the outstanding principal balance of the related
Mortgage Loan at the time it became an REO Property. The Servicer will
comply in the performance of this Agreement with all reasonable rules and
requirements of each insurer under any such hazard policies. Any amounts
to be
collected by the Servicer under any such policies (other than amounts required
to be deposited in the Escrow Account and applied to the restoration or
repair
of the property subject to the related Mortgage or amounts to be released
to the
Mortgagor in accordance with the procedures that the Servicer would follow
in
servicing loans held for its own account, subject to the terms and conditions
of
the related Mortgage and Mortgage Note) shall be deposited in the Collection
Account, subject to withdrawal pursuant to Section 3.11. Any cost incurred
by the Servicer in maintaining any such insurance shall not, for the purpose
of
calculating distributions to the Master Servicer, be added to the unpaid
principal balance of the related Mortgage Loan, notwithstanding that the
terms
of such Mortgage Loan so permit. It is understood and agreed that no earthquake
or other additional insurance is to be required of any Mortgagor other
than
pursuant to such applicable laws and regulations as shall at any time be
in
force and as shall require such additional insurance. If the Mortgaged
Property
or REO Property is at any time in an area identified in the Federal Register
by
the Federal Emergency Management Agency as having special flood hazards
and
flood insurance has been made available, the Servicer will cause to be
maintained a flood insurance policy in respect thereof. Such flood insurance
shall be in an amount equal to the lesser of (i) the unpaid principal
balance of the related Mortgage Loan and (ii) the maximum amount of such
insurance available for the related Mortgaged Property under the national
flood
insurance program (assuming that the area in which such Mortgaged Property
is
located is participating in such program).
In
the
event that the Servicer shall obtain and maintain a blanket policy with
an
insurer having a general policy rating of A:VI or better in Best’s (or such
other rating that is comparable to such rating) insuring against hazard
losses
on all of the Mortgage Loans, it shall conclusively be deemed to have satisfied
its obligations as set forth in the first two sentences of this
Section 3.13, it being understood and agreed that such policy may contain a
deductible clause, in which case the Servicer shall, in the event that
there
shall not have been maintained on the related Mortgaged Property or REO
Property
a policy complying with the first two sentences of this Section 3.13, and
there shall have been one or more losses which would have been covered
by such
policy, deposit to the Collection Account from its own funds the amount
not
otherwise payable under the blanket policy because of such deductible clause.
In
connection with its activities as administrator and servicer of the Mortgage
Loans, the Servicer agrees to prepare and present, on behalf of itself
and the
Trustee, claims under any such blanket policy in a timely fashion in accordance
with the terms of such policy.
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(b) The
Servicer shall keep in force during the term of this Agreement a policy
or
policies of insurance covering errors and omissions for failure in the
performance of the Servicer’s obligations under this Agreement, which policy or
policies shall be in such form and amounts as shall be consistent with
Accepted
Servicing Practices. The Servicer shall also maintain a fidelity bond in
such
form and amount as shall be consistent with Accepted Servicing Practices.
The
Servicer shall provide the Master Servicer with copies of any such insurance
policies and fidelity bond; provided,
however,
so long
as the Servicer hereunder is ▇▇▇▇▇ Fargo, the Servicer may satisfy such
requirement by providing the Master Servicer with a certification of any
such
insurance upon request. The Servicer shall be deemed to have complied with
this
provision if an Affiliate of the Servicer has such errors and omissions
and
fidelity bond coverage and, by the terms of such insurance policy or fidelity
bond, the coverage afforded thereunder extends to the Servicer. Any such
errors
and omissions policy and fidelity bond shall by its terms not be cancelable
without thirty days’ prior written notice to the Master Servicer. The
Servicer shall also cause each Subservicer to maintain a policy of insurance
covering errors and omissions and a fidelity bond which would meet such
requirements.
Section
3.14 Enforcement
of Due-On-Sale Clauses; Assumption Agreements. The Servicer will, to the
extent it has knowledge of any conveyance or prospective conveyance of
any
Mortgaged Property by any Mortgagor (whether by absolute conveyance or
by
contract of sale, and whether or not the Mortgagor remains or is to remain
liable under the Mortgage Note and/or the Mortgage), exercise its rights
to
accelerate the maturity of such Mortgage Loan under the “due-on-sale” clause, if
any, applicable thereto; provided,
however,
that
the Servicer shall not exercise any such rights if prohibited by law from
doing
so or if the exercise of such rights would impair or threaten to impair
recovery
under the related Primary Mortgage Insurance Policy, if any. If the Servicer
believes it is unable under applicable law to enforce such “due-on-sale”
clause or if any of the other conditions set forth in the proviso to the
preceding sentence apply, the Servicer will enter into either (i) an
assumption and modification agreement from or with the person to whom such
property has been conveyed or is proposed to be conveyed, pursuant to which
such
person becomes liable under the Mortgage Note and, to the extent permitted
by
applicable state law, the Mortgagor remains liable thereon or (ii) a
substitution agreement as provided in the succeeding sentence. The Servicer
is
also authorized to enter into a substitution of liability agreement with
such
person, pursuant to which the original Mortgagor is released from liability
and
such person is substituted as the Mortgagor and becomes liable under the
Mortgage Note, provided,
that no
such substitution shall be effective unless such person satisfies the
underwriting criteria of the Originator and has a credit risk rating at
least
equal to that of the original Mortgagor. The Mortgage Loan, as assumed,
shall
conform in all respects to the requirements, representations and warranties
of
this Agreement. The Servicer shall not take or enter into any assumption
and
modification agreement, however, unless (to the extent practicable in the
circumstances) it shall have received confirmation, in writing, of the
continued
effectiveness of any applicable hazard insurance policy, or a new policy
meeting
the requirements of this Section is obtained. Any fee collected by the
Servicer in respect of an assumption or substitution of liability agreement
will
be retained by the Servicer as additional servicing compensation. In connection
with any such assumption, no material term of the Mortgage Note (including
but
not limited to the related Mortgage Rate and the amount of the Scheduled
Payment) may be amended or modified, except as otherwise required pursuant
to
the terms thereof. The Servicer shall notify the Master Servicer that any
such
substitution, modification or assumption agreement has been completed and
shall
forward to the Custodian the executed original of such substitution or
assumption agreement, which document shall be added to the related Mortgage
File
and shall, for all purposes, be considered a part of such Mortgage File
to the
same extent as all other documents and instruments constituting a part
thereof.
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Notwithstanding
the foregoing paragraph or any other provision of this Agreement, the
Servicer shall not be deemed to be in default or any other violation of
its
obligations hereunder by reason of any assumption of a Mortgage Loan by
operation of law or by the terms of the Mortgage Note or any assumption
which
the Servicer may be restricted by law from preventing, for any reason
whatsoever. For purposes of this Section 3.14, the term “assumption” is
deemed to also include a sale (of the Mortgaged Property) subject to the
Mortgage that is not accompanied by an assumption or substitution of liability
agreement.
Section
3.15 Realization
upon Defaulted Mortgage Loans. The Servicer shall use its best efforts,
consistent with Accepted Servicing Practices, to foreclose upon or otherwise
comparably convert (which may include an acquisition of REO Property) the
ownership of properties securing such of the Mortgage Loans as come into
and
continue in default and as to which no satisfactory arrangements can be
made for
collection of delinquent payments pursuant to Section 3.07, and which are
not released from this Agreement pursuant to any other provision hereof.
The
Servicer shall use reasonable efforts to realize upon such defaulted Mortgage
Loans in such manner as will maximize the receipt of principal and interest
by
the Securities Administrator, taking into account, among other things,
the
timing of foreclosure proceedings; provided,
however,
in
the
event that any payment due under any Mortgage Loan is not permissibly postponed
pursuant to this Agreement and remains delinquent for a period of 90 days
or any
other default continues for a period of 90 days beyond the expiration of
any
grace or cure period, the Servicer shall commence foreclosure proceedings;
and
provided,
further,
with
respect to any second-lien Mortgage Loan, if, after such Mortgage Loan
becomes
180 days or more delinquent, the Servicer determines that a significant
net
recovery is not possible through foreclosure, such Mortgage Loan may be
charged-off and the Mortgage Loan will be treated as a Liquidated Mortgage
Loan
giving rise to a Realized Loss. The foregoing is subject to the provisions
that
the Servicer shall not be required to expend its own funds in connection
with
foreclosure or other conversion, correction of a default on a senior mortgage
or
restoration of any property unless it shall determine in its sole discretion
(i) that such foreclosure, correction or restoration will increase the net
Liquidation Proceeds of the related Mortgage Loan to the Securities
Administrator, after reimbursement to itself for such expenses and
(ii) that such expenses will be recoverable by the Servicer through
Insurance Proceeds, Condemnation Proceeds, Liquidation Proceeds or Subsequent
Recoveries from the related Mortgaged Property, as contemplated in
Section 3.11. The Servicer shall be responsible for all other costs and
expenses incurred by it in any such proceedings; provided,
however,
that it
shall be entitled to reimbursement thereof from the related property, as
contemplated in Section 3.11.
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The
proceeds of any liquidation or REO Disposition, as well as any recovery
resulting from a partial collection of Insurance Proceeds, Condemnation
Proceeds, Liquidation Proceeds or Subsequent Recoveries or any income from
an
REO Property, will be applied in the following order of priority: first,
to
reimburse the Servicer or any Subservicer for any related unreimbursed
Servicing
Advances, pursuant to Section 3.11 or 3.17; second,
to
reimburse the Servicer for any related ▇▇▇▇▇▇▇▇▇▇▇▇ ▇&▇ Advances, pursuant
to Section 3.11; third,
to
accrued and unpaid interest on the Mortgage Loan or REO Imputed Interest,
at the
Mortgage Rate, to the date of the liquidation or REO Disposition, or to
the Due
Date prior to the Remittance Date on which such amounts are to be distributed
if
not in connection with a liquidation or REO Disposition; and fourth,
as a
recovery of principal of the Mortgage Loan. If the amount of the recovery
so
allocated to interest is less than a full recovery thereof, that amount
will be
allocated as follows: first,
to
unpaid Servicing Fees; and second,
as
interest at the Mortgage Rate (net of the Servicing Fee Rate). The portion
of
the recovery so allocated to unpaid Servicing Fees shall be reimbursed
to the
Servicer or any Subservicer pursuant to Section 3.11 or 3.17. The portions
of the recovery so allocated to interest at the Mortgage Rate (net of the
Servicing Fee Rate) and to principal of the Mortgage Loan shall be applied
as
follows: first,
to
reimburse the Servicer or any Subservicer for any related unreimbursed
Servicing
Advances in accordance with Section 3.11 or 3.17, and second,
to the
Securities Administrator in accordance with the provisions of Section 4.02,
subject to paragraph (e) of Section 3.17 with respect to certain
excess recoveries from an REO Disposition.
Notwithstanding
anything to the contrary contained herein, in connection with a foreclosure
or
acceptance of a deed in lieu of foreclosure, in the event the Servicer
has
received actual notice of, or has actual knowledge of the presence of,
hazardous
or toxic substances or wastes on the related Mortgaged Property, or if
the
Trustee or the Master Servicer otherwise requests, the Servicer shall cause
an
environmental inspection or review of such Mortgaged Property to be conducted
by
a qualified inspector. Upon completion of the inspection, the Servicer
shall
promptly provide the Trustee, the Master Servicer and the Depositor with
a
written report of the environmental inspection.
After
reviewing the environmental inspection report, the Servicer shall determine
consistent with Accepted Servicing Practices how to proceed with respect
to the
Mortgaged Property. In the event (a) the environmental inspection report
indicates that the Mortgaged Property is contaminated by hazardous or toxic
substances or wastes and (b) the Servicer proceeds with foreclosure or
acceptance of a deed in lieu of foreclosure, the Servicer shall be reimbursed
for all reasonable costs associated with such foreclosure or acceptance
of a
deed in lieu of foreclosure and any related environmental clean-up costs,
as
applicable, from the related Liquidation Proceeds, or if the Liquidation
Proceeds are insufficient to fully reimburse the Servicer, the Servicer
shall be
entitled to be reimbursed from amounts in the Collection Account pursuant
to
Section 3.11. In the event the Servicer does not proceed with foreclosure
or acceptance of a deed in lieu of foreclosure, the Servicer shall be reimbursed
from general collections for all Servicing Advances made with respect to
the
related Mortgaged Property from the Collection Account pursuant to
Section 3.11. The Trustee shall not be responsible for any determination
made by the Servicer pursuant to this paragraph or otherwise.
Section
3.16 Release
of Mortgage Files. (a) Upon the payment in full of any Mortgage
Loan, or the receipt by the Servicer of a notification that payment in
full
shall be escrowed in a manner customary for such purposes, the Servicer
will,
within five (5) Business Days of the payment in full, notify the Custodian
by a
certification (which certification shall include a statement to the effect
that
all amounts received or to be received in connection with such payment
which are
required to be deposited in the Collection Account pursuant to Section 3.10
have been or will be so deposited) of a Servicing Officer and shall request
delivery to it of the Custodial File by submitting a Request for Release
to the
Custodian, which Request for Release may be in an electronic format in
a form
acceptable to the Custodian, to the Custodian. Upon receipt of such
certification and Request for Release, the Custodian shall promptly release
the
related Custodial File to the Servicer within five (5) Business Days. No
expenses incurred in connection with any instrument of satisfaction or
deed of
reconveyance shall be chargeable to the Collection Account.
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(b) From
time
to time and as appropriate for the servicing or foreclosure of any Mortgage
Loan, including, for this purpose, collection under any Insurance Policy
relating to the Mortgage Loans, the Custodian shall, upon request of the
Servicer and delivery to the Custodian of a Request for Release, which
Request
for Release may be in an electronic format in a form acceptable to the
Custodian, release the related Custodial File to the Servicer, and the
Custodian
shall, at the direction of the Servicer, execute such documents as shall
be
necessary to the prosecution of any such proceedings and the Servicer shall
retain the Mortgage File in trust for the benefit of the Trustee. Such
Request
for Release shall obligate the Servicer to return each and every document
previously requested from the Custodial File to the Custodian when the
need
therefor by the Servicer no longer exists, unless the Mortgage Loan has
been
liquidated and the Liquidation Proceeds relating to the Mortgage Loan have
been
deposited in the Collection Account or the Mortgage File or such document
has
been delivered to an attorney, or to a public trustee or other public official
as required by law, for purposes of initiating or pursuing legal action
or other
proceedings for the foreclosure of the Mortgaged Property either judicially
or
non-judicially, and the Servicer has delivered to the Custodian a certificate
of
a Servicing Officer certifying as to the name and address of the Person
to which
such Mortgage File or such document was delivered and the purpose or purposes
of
such delivery. Upon receipt of a certificate of a Servicing Officer stating
that
such Mortgage Loan was liquidated and that all amounts received or to be
received in connection with such liquidation that are required to be deposited
into the Collection Account have been so deposited, or that such Mortgage
Loan
has become an REO Property, a copy of the Request for Release shall be
released
by the Custodian to the Servicer or its designee.
Upon
written certification of a Servicing Officer, the Trustee shall execute
and
deliver to the Servicer copies of any court pleadings, requests for trustee’s
sale or other documents reasonably necessary to the foreclosure or trustee’s
sale in respect of a Mortgaged Property or to any legal action brought
to obtain
judgment against any Mortgagor on the Mortgage Note or Mortgage or to obtain
a
deficiency judgment, or to enforce any other remedies or rights provided
by the
Mortgage Note or Mortgage or otherwise available at law or in equity, or
shall
exercise and deliver to the Servicer a power of attorney sufficient to
authorize
the Servicer to execute such documents on its behalf. Each such certification
shall include a request that such pleadings or documents be executed by
the
Trustee and a statement as to the reason such documents or pleadings are
required and that the execution and delivery thereof by the Trustee will
not
invalidate or otherwise affect the lien of the Mortgage, except for the
termination of such a lien upon completion of the foreclosure or trustee’s
sale.
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Section
3.17 Title,
Conservation and Disposition of REO Property. (a) This Section
shall apply only to REO Properties acquired for the account of the Trustee
and
shall not apply to any REO Property relating to a Mortgage Loan which was
purchased or repurchased from the Trustee pursuant to any provision hereof.
In
the event that title to any such REO Property is acquired, the deed or
certificate of sale shall be issued to the Trust, or if not permitted by
law, to
Deutsche Bank National Trust Company (or, if applicable, the name of the
successor Trustee) as Trustee for HSI Asset Securitization Corporation
Trust
2007-WF1 Mortgage Pass-Through Certificates, Series 2007-WF1, or to its
nominee,
for the benefit of the Certificateholders.
(b) The
Servicer shall manage, conserve, protect and operate each REO Property for
the Trustee solely for the purpose of its prompt disposition and sale.
The
Servicer, either itself or through an agent selected by the Servicer, shall
manage, conserve, protect and operate the REO Property in the same manner
that
it manages, conserves, protects and operates other foreclosed property
for its
own account, and in the same manner that similar property in the same locality
as the REO Property is managed. The Servicer shall attempt to sell the
same (and
may temporarily rent the same for a period not greater than one year, except
as
otherwise provided below) on such terms and conditions as the Servicer
deems to
be in the best interest of the Trustee on behalf of the Certificateholders.
The
Servicer shall notify the Trustee from time to time as to the status of
each REO
Property.
(c) The
Servicer shall segregate and hold all funds collected and received in connection
with the operation of any REO Property separate and apart from its own
funds and
general assets and shall deposit such funds in the Collection
Account.
(d) The
Servicer shall deposit net of reimbursement to the Servicer for any related
outstanding Servicing Advances and unpaid Servicing Fees provided in
Section 3.11, or cause to be deposited in the Collection Account, in no
event later than two Business Days after the deposit of such funds into
the
clearing account, all revenues received with respect to the related REO
Property
and shall withdraw therefrom funds necessary for the proper operation,
management and maintenance of the REO Property.
(e) The
Servicer, upon an REO Disposition, shall be entitled to reimbursement for
any
related unreimbursed Servicing Advances as well as any unpaid Servicing
Fees
from proceeds received in connection with the REO Disposition, as further
provided in Section 3.11.
(f) Any
net
proceeds from an REO Disposition which are in excess of the unpaid principal
balance of the related Mortgage Loan plus all unpaid REO Imputed Interest
thereon through the date of the REO Disposition shall be retained by the
Servicer as additional servicing compensation.
(g) The
Servicer shall use Accepted Servicing Practices to sell, or cause the
Subservicer to sell, in accordance with Accepted Servicing Practices, any
REO
Property as soon as possible, but in no event later than the conclusion
of the
third calendar year beginning after the year of its acquisition by the
REMIC 1
unless (i) the Servicer applies for an extension of such period from the
Internal Revenue Service pursuant to the REMIC Provisions and Code
Section 856(e)(3), in which event such REO Property shall be sold within
the applicable extension period, or (ii) the Servicer obtains for the
Trustee an Opinion of Counsel, addressed to the Depositor, the Trustee
and the
Servicer, to the effect that the holding by the REMIC of such REO Property
subsequent to such period will not result in the imposition of taxes on
“prohibited transactions” as defined in Section 860F of the Code or cause
any REMIC created under this Agreement to fail to qualify as a REMIC under
the
REMIC Provisions or comparable provisions of relevant state laws at any
time.
The Servicer shall manage, conserve, protect and operate each REO Property
for
the Trustee solely for the purpose of its prompt disposition and sale in
a
manner which does not cause such REO Property to fail to qualify as “foreclosure
property” within the meaning of Section 860G(a)(8) or result in the receipt
by any REMIC created hereunder of any “income from non-permitted assets” within
the meaning of Section 860F(a)(2)(B) of the Code or any “net income from
foreclosure property” which is subject to taxation under Section 860G(a)(1)
of the Code. Pursuant to its efforts to sell such REO Property, the Servicer
shall either itself or through an agent selected by the Servicer protect
and
conserve such REO Property in the same manner and to such extent as is
customary
in the locality where such REO Property is located and may, incident to
its
conservation and protection of the interests of the Trustee on behalf of
the
Certificateholders, rent the same, or any part thereof, as the Servicer
deems to
be in the best interest of the Trustee on behalf of the Certificateholders
for
the period prior to the sale of such REO Property; provided,
however,
that
any rent received or accrued with respect to such REO Property qualifies
as
“rents from real property” as defined in Section 856(d) of the
Code.
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Section
3.18 Notification
of Adjustments. With respect to each Adjustable Rate Mortgage Loan, the
Servicer shall adjust the Mortgage Rate on the related Adjustment Date
and shall
adjust the Scheduled Payment on the related mortgage payment adjustment
date, if
applicable, in compliance with the requirements of applicable law and the
related Mortgage and Mortgage Note. In the event that an Index becomes
unavailable or otherwise unpublished, the Servicer shall select a comparable
alternative index over which it has no direct control and which is readily
verifiable. The Servicer shall execute and deliver any and all necessary
notices
required under applicable law and the terms of the related Mortgage Note
and
Mortgage regarding the Mortgage Rate and Scheduled Payment adjustments.
The
Servicer shall promptly, upon written request therefor, deliver to the
Master
Servicer such notifications and any additional applicable data regarding
such
adjustments and the methods used to calculate and implement such adjustments.
Upon the discovery by the Servicer or the receipt of notice from the Master
Servicer that the Servicer has failed to adjust a Mortgage Rate or Scheduled
Payment in accordance with the terms of the related Mortgage Note, the
Servicer
shall deposit in the Collection Account from its own funds the amount of
any
interest loss caused as such interest loss occurs.
Section
3.19 Access
to Certain Documentation and Information Regarding the Mortgage Loans. The
Servicer shall provide, or cause the Subservicer to provide, to the Depositor
and the Trustee, at the request of the OTS or the FDIC and the examiners
and
supervisory agents thereof, access to the documentation regarding the Mortgage
Loans in its possession required by applicable regulations of the OTS.
Such
access shall be afforded without charge, but only upon 10 days (or, if
an Event
of Default has occurred and is continuing, 3 Business Days) prior written
request and during normal business hours at the offices of the Servicer
or, if
applicable, any Subservicer. Nothing in this Section shall derogate from
the
obligation of any such party to observe any applicable law prohibiting
disclosure of information regarding the Mortgagors and the failure of any
such
party to provide access as provided in this Section as a result of such
obligation shall not constitute a breach of this Section.
Nothing
in this Section 3.19 shall require the Servicer to collect, create, collate
or
otherwise generate any information that it does not generate in its usual
course
of business. The Servicer shall not be required to make copies of or to
ship
documents to any Person who is not a party to this Agreement, and then
only if
provisions have been made for the reimbursement of the costs
thereof.
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Section
3.20 Documents,
Records and Funds in Possession of the Servicer to Be Held for the Trustee.
Not later than thirty days after each Distribution Date, the Servicer shall
forward to the Trustee, the Master Servicer and the Securities Administrator
a
statement prepared by the Servicer setting forth the status of the Collection
Account as of the close of business on the last day of the calendar month
relating to such Distribution Date and showing, for the period covered
by such
statement, the aggregate amount of deposits into and withdrawals from the
Collection Account of each category of deposit specified in Section 3.10(a)
and each category of withdrawal specified in Section 3.11. Copies of such
statement shall be provided by the Securities Administrator to any
Certificateholder and to any Person identified to the Securities Administrator
as a prospective transferee of a Certificate, upon the written request
and at
the expense of the requesting party, provided such statement is delivered
by the
Servicer to the Securities Administrator.
Section
3.21 Servicing
Compensation. (a) As compensation for its activities hereunder,
the Servicer shall, with respect to each Mortgage Loan, be entitled to
retain
from deposits to the Collection Account and from applicable Liquidation
Proceeds, Condemnation Proceeds, Insurance related Proceeds, Subsequent
Recoveries and REO Proceeds related to such Mortgage Loan, the Servicing
Fee
with respect to each Mortgage Loan (less any portion of such amounts retained
by
any Subservicer). In addition, the Servicer shall be entitled to recover
unpaid
Servicing Fees out of related Late Collections and as otherwise permitted
under
Section 3.11. The right to receive the Servicing Fee may not be transferred
in whole or in part except in connection with the transfer of all of the
Servicer’s responsibilities and obligations under this Agreement; provided,
however,
that
the Servicer may pay from the Servicing Fee any amounts due to a Subservicer
pursuant to a Subservicing Agreement entered into under
Section 3.02.
(b) Additional
servicing compensation in the form of assumption or modification fees,
late
payment charges, NSF fees, reconveyance fees and other similar fees and
charges
(other than Prepayment Charges) shall be retained by the Servicer only
to the
extent such fees or charges are received by the Servicer. The Servicer
shall
also be entitled pursuant to Section 3.11(a)(iv) to withdraw from the
Collection Account, as additional servicing compensation, interest or other
income earned on deposits therein. The Servicer shall also be entitled
as
additional servicing compensation, to interest or other income earned on
deposits in the Escrow Account (to the extent permitted by law and the
related
Mortgage Loan documents) in accordance with Section 3.12.
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(c) The
Servicer shall be required to pay all expenses incurred by it in connection
with
its servicing activities hereunder (including payment of premiums for
any
blanket policy insuring against hazard losses pursuant to Section 3.13,
servicing compensation of the Subservicer to the extent not retained
by it and
the fees and expenses of independent accountants and any agents appointed
by the
Servicer), and shall not be entitled to reimbursement therefor from the
Trust
Fund except as specifically provided in Section 3.11.
Section
3.22 Report
on Assessment of Compliance with Relevant Servicing Criteria. On or before
March 15th
of each
calendar year, commencing in March 2008, the Servicer, the Master Servicer,
the
Securities Administrator and the Custodian, each at its own expense,
shall
furnish or otherwise make available, and each such party shall cause
any
Servicing Function Participant engaged by it to furnish, each at its
own
expense, to the Master Servicer, the Securities Administrator and the
Depositor,
a report on an assessment of compliance with the Relevant Servicing Criteria
set
forth in Exhibit S 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 as of and for the fiscal
year
covered by the Form 10-K required to be filed pursuant to Section 8.12,
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 as of and for such period.
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 Master
Servicer, the Securities Administrator, the Custodian, the Servicer and
any
Servicing Function Participant engaged by any such party 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 S.
The
Master Servicer shall enforce any obligation of the Servicer (and the Servicer
shall enforce any obligation of a Servicing Function Participant engaged
by the
Servicer) to cause to be delivered to the Securities Administrator an annual
report on assessment of compliance within the time frame and
to
the parties indicated in
this
Section 3.22, and in such form and
substance as may be required by this Agreement.
In
the
event the Servicer, the Master Servicer, the Securities Administrator,
the
Custodian or any Servicing Function Participant engaged by any such party
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 a report on assessment of compliance pursuant
to
this Section 3.22, or to such other applicable agreement, for the period
of time
in such reporting period prior to such termination, assignment or resignation,
notwithstanding any such termination, assignment or resignation.
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The
Custodian shall only be required to provide an assessment of compliance
as set
forth herein for so long as the Depositor is required to file reports
with
respect to the Trust under the Exchange Act.
Section
3.23 Report
on Attestation of Compliance with Relevant Servicing Criteria.
On or
before March 15th
of each
calendar year, commencing in March 2008, the Servicer, the Master Servicer,
the
Securities Administrator and the Custodian, each at its own expense,
shall
cause, and each such party shall cause any Servicing Function Participant
engaged by it to cause, each at its own expense, a registered public
accounting
firm (which may also render other services to the Servicer, the Master
Servicer,
the Securities Administrator, the Custodian or such other Servicing Function
Participants, as the case may be) that is a member of the American Institute
of
Certified Public Accountants to furnish an attestation report to the
Master
Servicer, the Securities Administrator and the Depositor, 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 Public Company Accounting Oversight Board, 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 each such assessment of compliance and attestation report,
the
Securities Administrator shall confirm that each assessment submitted pursuant
to Section 3.22 is coupled with an attestation meeting the requirements
of this
Section and notify the Depositor of any exceptions.
The
Master Servicer shall enforce any obligation of the Servicer (and the Servicer
shall enforce any obligation of a Servicing Function Participant engaged
by the
Servicer) to cause to be delivered to the Securities Administrator an
attestation within the time frame and to the parties indicated in this
Section
3.23, and in such form and substance as may be required by this Agreement.
In
the
event the Servicer, the Master Servicer, the Securities Administrator,
the
Custodian or any Servicing Function Participant engaged by any such party,
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 3.23, or to such other applicable
agreement, notwithstanding any such termination, assignment or resignation.
The
Custodian shall only be required to cause a registered public accounting
firm to
provide an attestation report as set forth herein for so long as the Depositor
is required to file reports with respect to the Trust under the Exchange
Act.
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Section
3.24 Annual
Officer’s Certificates.
(a)
Each Form 10-K filed with the Commission shall include a ▇▇▇▇▇▇▇▇-▇▇▇▇▇
Certification exactly as set forth in Exhibit L attached hereto, required
to be
included therewith pursuant to the ▇▇▇▇▇▇▇▇-▇▇▇▇▇ Act. Each of the Servicer,
the
Master Servicer, the Securities Administrator and the Custodian shall,
and shall
cause any Servicing Function Participant engaged by it to, provide to the
Person
who signs the ▇▇▇▇▇▇▇▇-▇▇▇▇▇ Certification (the “Certifying
Person”),
by
March 10th
of each
year in which the Trust is subject to the reporting requirements of the
Exchange
Act, commencing in March 2008, and otherwise within a reasonable period
of time
upon request, a certification (each, a “Back-Up
▇▇▇▇▇▇▇▇-▇▇▇▇▇ Certification”),
substantially in the form of 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 serve as the Certifying Person on behalf
of the
Trust. Such officer of the Certifying Person can be contacted by e-mail
at
▇▇▇.▇▇▇.▇▇▇▇▇▇▇▇▇▇▇▇▇@▇▇▇▇▇▇▇▇▇▇.▇▇▇
or by
facsimile at ▇▇▇-▇▇▇-▇▇▇▇. In the event any such party or any Servicing
Function
Participant engaged by any such party is terminated or resigns pursuant
to the
terms of this Agreement, or any applicable sub-servicing agreement, as
the case
may be, such party shall provide a Back-Up ▇▇▇▇▇▇▇▇-▇▇▇▇▇ Certification
to the
Certifying Person pursuant to this Section 3.24 with respect to the period
of
time it was subject to this Agreement or any applicable sub-servicing 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 both are the same Person and the Master Servicer is the
Certifying Person and (ii) the Master Servicer shall not be obligated to
sign
the ▇▇▇▇▇▇▇▇-▇▇▇▇▇ Certification in the event that it does not receive
any
Back-Up ▇▇▇▇▇▇▇▇-▇▇▇▇▇ Certification required to be furnished to it pursuant
to
this section.
(b) On
or
before March 15th
of each
calendar year, commencing in March 2008, the Servicer, the Master Servicer
and
the Securities Administrator shall deliver (or otherwise make available)
(and
the Servicer, the Master Servicer and Securities Administrator shall cause
any
Servicing Function Participant engaged by it to deliver) to the Depositor
and
the Securities Administrator, an Officer’s Certificate substantially in the form
of Exhibit U 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 party’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, 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.
In
the
event the Servicer, the Master Servicer, the Securities Administrator or
any
Servicing Function Participant engaged by any such party is terminated
or
resigns pursuant to the terms of this Agreement, or any applicable agreement
in
the case of a Servicing Function Participant, as the case may be, such
party
shall provide an Officer’s Certificate covering the portion of the reporting
period for which it is served pursuant to this Section 3.24 or to such
applicable agreement, as the case may be, notwithstanding any such termination,
assignment or resignation.
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(c) The
Servicer shall indemnify and hold harmless the Trustee, the Master Servicer,
the
Securities Administrator, the Depositor and their respective officers,
directors, agents and affiliates from and against any losses, damages,
penalties, fines, forfeitures, reasonable legal fees and related costs,
judgments and other costs and expenses arising out of or based upon a breach
by
the Servicer or any of its officers, directors, agents or affiliates of
its
obligations under this Section 3.24 or the negligence, bad faith or willful
misconduct of the Servicer in connection therewith. If the indemnification
provided for herein is unavailable or insufficient to hold harmless the
Trustee,
the Master Servicer, the Securities Administrator and the Depositor, then
the
Servicer agrees that it shall contribute to the amount paid or payable
by the
Trustee, the Master Servicer, the Securities Administrator, the Depositor
or
their respective officers, directors, agents or affiliates as a result
of the
losses, claims, damages or liabilities of any such party in such proportion
as
is appropriate to reflect the relative fault of such party or parties on
the one
hand and the Servicer on the other in connection with a breach of the Servicer’s
obligations under this Section 3.24 or the Servicer’s negligence, bad faith or
willful misconduct in connection therewith.
Section
3.25 Master
Servicer to Act as Servicer. (a) Subject to Section 7.02, in
the event that the Servicer shall for any reason no longer be the Servicer
hereunder (including by reason of an Event of Default), the Master Servicer
or
its successor shall thereupon assume all of the rights and obligations
of the
Servicer hereunder arising thereafter, except that the Master Servicer
shall not
be (i) liable for losses of the predecessor Servicer pursuant to
Section 3.10 or any acts or omissions of the predecessor Servicer
hereunder, (ii) obligated to effectuate repurchases or substitutions of
Mortgage Loans hereunder, including but not limited to repurchases or
substitutions pursuant to Section 2.03, (iii) responsible for expenses
of the predecessor Servicer pursuant to Section 2.03 or (iv) deemed to
have made any representations and warranties of the Servicer hereunder.
Any such
assumption shall be subject to Section 7.02.
(b) Every
Subservicing Agreement entered into by the Servicer shall contain a provision
giving the successor servicer the option to terminate such agreement in
the
event a successor servicer is appointed.
(c) If
the
Servicer shall for any reason no longer be the Servicer (including by reason
of
any Event of Default), the Master Servicer or the Trustee (as successor
master
servicer), as applicable, (or any other successor servicer) may, at its
option,
succeed to any rights and obligations of the Servicer under any Subservicing
Agreement in accordance with the terms thereof; provided,
that
the Master Servicer or the Trustee (as successor master servicer), as
applicable, (or any other successor servicer) shall not incur any liability
or
have any obligations in its capacity as successor servicer under a Subservicing
Agreement arising prior to the date of such succession unless it expressly
elects to succeed to the rights and obligations of the Servicer thereunder;
and
the Servicer shall not thereby be relieved of any liability or obligations
under
the Subservicing Agreement arising prior to the date of such
succession.
(d) The
Servicer shall, upon request of the Master Servicer or the Trustee (as
successor
master servicer), as applicable, but at the expense of the Servicer, deliver
to
the assuming party all documents and records relating to each Subservicing
Agreement (if any) and the Mortgage Loans then being serviced thereunder
and an
accounting of amounts collected and held by it, and otherwise use its best
efforts to effect the orderly and efficient transfer of the Subservicing
Agreement to the assuming party.
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Section
3.26 Compensating
Interest. The Servicer shall remit to the Master Servicer on each Remittance
Date an amount from its own funds equal to the Compensating Interest payable
by
the Servicer for the related Distribution Date.
Section
3.27 Credit
Reporting; ▇▇▇▇▇-▇▇▇▇▇-▇▇▇▇▇▇ Act. (a) With respect to each
Mortgage Loan serviced by it, the Servicer agrees to fully furnish, in
accordance with the Fair Credit Reporting Act and its implementing regulations,
accurate and complete information (e.g., favorable and unfavorable) on
the
primary borrower of such Mortgage Loan to Equifax, Experian and TransUnion
Credit Information Company (three of the credit repositories) on a monthly
basis.
(b) The
Servicer shall comply with Title V of the ▇▇▇▇▇-▇▇▇▇▇-▇▇▇▇▇▇ Act of 1999
and all applicable regulations promulgated thereunder, relating to the
Mortgage
Loans and the related borrowers and shall provide all required notices
thereunder.
Section
3.28 [Reserved].
Section
3.29 Notifications
to Parties. The Servicer shall promptly notify the Master Servicer and the
Depositor (i) of any legal proceedings pending against the Servicer of
the type
described in Item 1117 (§ 229.1117) of Regulation AB and (ii) if the Servicer
shall become (but only to the extent not previously disclosed to the Master
Servicer and the Depositor) at any time an affiliate of any of the parties
listed on Exhibit T to this Agreement. If so requested by the Master Servicer
or
the Depositor on any date following the date on which information was first
provided to the Master Servicer and the Depositor, pursuant to the preceding
sentence, the Servicer shall within five Business Days following such request,
confirm in writing that except as disclosed in writing to the Master Servicer,
the Depositor, the Trustee, and the Securities Administrator, prior to
the
Closing Date: (i) ▇▇▇▇▇ Fargo is not aware and has not received notice
that any
default, early amortization or other performance triggering event has occurred
as to any other securitization due to any act or failure to act of ▇▇▇▇▇
Fargo;
(ii) ▇▇▇▇▇ Fargo has not been terminated as servicer in a residential mortgage
loan securitization, either due to a servicing default or to application
of a
servicing performance test or trigger; (iii) no material noncompliance
with the
relevant servicing criteria with respect to other securitizations of residential
mortgage loans involving ▇▇▇▇▇ Fargo as servicer has been disclosed or
reported
by ▇▇▇▇▇ Fargo; (iv) no material changes to ▇▇▇▇▇ Fargo’s policies or procedures
with respect to the servicing function it will perform under this Agreement
for
mortgage loans of a type similar to the Mortgage Loans have occurred during
the
three-year period immediately preceding the Closing Date; (v) there are
no
aspects of ▇▇▇▇▇ Fargo’s financial condition that could have a material adverse
effect on the performance by ▇▇▇▇▇ Fargo’s financial condition that could have a
material adverse effect on the performance by ▇▇▇▇▇ Fargo of its servicing
obligations under this Agreement and (vi) there are no affiliations,
relationships or transactions relating to ▇▇▇▇▇ Fargo or any Subservicer
with
any party listed on Exhibit T hereto, other than its affiliation with the
Securities Administrator, the Master Servicer, the Custodian and the Originator,
or, the Servicer shall, if such a representation and warranty is not accurate
as
of the date of such request, provide reasonable adequate disclosure of
the
pertinent facts, in writing, to the requesting party.
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The
Servicer shall provide to the Master Servicer and the Depositor prompt
notice of
the occurrence of any of the following: (i) any event of default under
the terms
of this Agreement; (ii) any merger, consolidation or sale of substantially
all
of the assets of the Servicer; (iii) the Servicer’s engagement of any
Subservicer or Subcontractor; (iv) any material litigation involving
the
Servicer; and (v) any affiliation or other significant relationship between
the
Servicer and other transaction parties.
Section
3.30 Indemnification.
(a) Each
of
the Depositor, the Servicer, the Master Servicer, the Securities Administrator,
the Custodian, the Trustee (only in the case of any failure to deliver
any
information, data or materials required to be included in any Additional
Form
10-D Disclosure, Additional Form 10-K Disclosure or Form 8-K Disclosure
Information that the Trustee is obligated to provide, and only with respect
to
the Depositor, the Master Servicer and the Securities Administrator)
and any
Servicing Function Participant (each, an “Indemnifying Party”) engaged by any
such party, shall indemnify and hold harmless each other Indemnifying
Party, and
each of its 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
annual statement of compliance, annual assessment of compliance with
Servicing
Criteria, attestation report or any information, data or materials required
to
be included in any Exchange Act report, (b) any material misstatement
or
omission in any information, data or materials provided by such party
pursuant
to this Agreement including any material misstatement or material omission
in
(i) any annual statement of compliance, annual assessment of compliance
with
Servicing Criteria or attestation report delivered by it, or by any Servicing
Function Participant engaged by it, pursuant to this Agreement, or (ii)
any
Additional Form 10-D Disclosure, Additional Form 10-K Disclosure or Form
8-K
Disclosure Information provided by it, or (c) the negligence, bad faith
or
willful misconduct of such indemnifying party in connection with its
performance
hereunder. If the indemnification provided for herein is unavailable
or
insufficient to hold harmless the Servicer, the Master Servicer, the
Securities
Administrator, the Trustee, the Custodian or the Depositor, as the case
may be,
then each Indemnifying Party agrees that it shall contribute to the amount
paid
or payable by the Servicer, the Master Servicer, the Securities Administrator,
the Trustee, the Custodian or the Depositor, as applicable, as a result
of any
claims, losses, damages or liabilities incurred by such party in such
proportion
as is appropriate to reflect the relative fault of the indemnified party
on the
one hand and the indemnifying party on the other. This indemnification
shall
survive the termination of this Agreement or the termination of any party
to
this Agreement.
(b) The
Depositor, the Servicer, the Securities Administrator,
the
Custodian and
the
Trustee shall immediately notify the Master Servicer if a claim is made
by a
third party with respect to this Agreement or the Mortgage Loans which
would
entitle the Depositor, the Servicer, the Securities Administrator, the
Custodian, the Trustee or the Trust to indemnification from the Master
Servicer,
whereupon the Master Servicer shall assume 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
them in respect of such claim. If the Master Servicer and any such indemnified
party have a conflict of interest with respect to any such claim, the
indemnified party shall have the right to retain separate counsel.
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ARTICLE
IV
DISTRIBUTIONS
AND
ADVANCES
BY THE SERVICER
Section
4.01 Advances.
(a) The amount of P&I Advances to be made by the Servicer for any
Remittance Date shall equal, subject to Section 4.01(c), the sum of
(i) the aggregate amount of Scheduled Payments (with each interest portion
thereof net of the related Servicing Fee), due during the Due Period immediately
preceding such Remittance Date in respect of the Mortgage Loans, which
Scheduled
Payments were not received as of the close of business on the related
Determination Date, plus (ii) with respect to each REO Property, which REO
Property was acquired during or prior to the related Prepayment Period
and as to
which such REO Property an REO Disposition did not occur during the related
Prepayment Period, an amount equal to the excess, if any, of the Scheduled
Payments (with each interest portion thereof net of the related Servicing
Fee)
that would have been due on the related Due Date in respect of the related
Mortgage Loans, over the net income from such REO Property transferred
to the
Collection Account for distribution on such Remittance Date.
(b) On
each
Remittance Date, the Servicer shall remit in immediately available funds
to the
Master Servicer an amount equal to the aggregate amount of P&I Advances, if
any, to be made in respect of the Mortgage Loans and REO Properties for
the
related Remittance Date either (i) from its own funds or (ii) from the
Collection Account, to the extent of funds held therein for future distribution
(in which case, it will cause to be made an appropriate entry in the records
of
the Collection Account that Amounts Held for Future Distribution have been,
as
permitted by this Section 4.01, used by it in discharge of any such P&I
Advance) or (iii) in the form of any combination of (i) and
(ii) aggregating the total amount of P&I Advances to be made by the
Servicer with respect to the Mortgage Loans and REO Properties. Any Amounts
Held
for Future Distribution and so used shall be appropriately reflected in
the
Servicer’s records and replaced by the Servicer by deposit in the Collection
Account on or before any future Remittance Date to the extent
required.
(c) The
obligation of the Servicer to make such P&I Advances is mandatory,
notwithstanding any other provision of this Agreement but subject to
(d) below, and, with respect to any Mortgage Loan or REO Property, shall
continue until a Final Recovery Determination in connection therewith or
the
removal thereof from coverage under this Agreement, except as otherwise
provided
in this Section.
(d) Notwithstanding
anything herein to the contrary, no P&I Advance or Servicing Advance shall
be required to be made hereunder by the Servicer if such P&I Advance or
Servicing Advance would, if made, constitute a Nonrecoverable P&I Advance or
Nonrecoverable Servicing Advance. The determination by the Servicer that
it has
made a Nonrecoverable P&I Advance or a Nonrecoverable Servicing Advance or
that any proposed P&I Advance or Servicing Advance, if made, would
constitute a Nonrecoverable P&I Advance or a Nonrecoverable Servicing
Advance, respectively, shall be evidenced by a Servicing Officer’s certificate
of the Servicer delivered to the Master Servicer. In addition, the Servicer
shall not be required to advance any Relief Act Interest
Shortfalls.
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(e) Except
as
otherwise provided herein, the Servicer shall be entitled to reimbursement
pursuant to Section 3.11 for Servicing Advances from recoveries from the
related Mortgagor or from all Liquidation Proceeds and other payments or
recoveries (including Insurance Proceeds, Condemnation Proceeds and Subsequent
Recoveries) with respect to the related Mortgage Loan.
(f) On
each
Remittance Date, the Master Servicer shall deposit in the Distribution
Account
all funds remitted to it by the Servicer pursuant to Sections 3.11(a)(i),
Section 3.26 and this Section 4.01. The Securities Administrator may retain
or
withdraw from the Distribution Account, (i) amounts necessary to reimburse
the
Servicer pursuant to this Agreement, (ii) amounts necessary to reimburse
the
Master Servicer for any previously unreimbursed Advances and any Advances
the
Master Servicer deems to be nonrecoverable from the related Mortgage Loan
proceeds and any investment income earned on amounts in the Distribution
Account
during the Securities Administrator Float Period, (iii) an amount to indemnify
the Master Servicer , the Securities Administrator or the Servicer for
amounts
due in accordance with this Agreement, (iv) all amounts representing Prepayment
Charges (payable to the Class P Certificateholders), (v) to reimburse the
Master Servicer, the Servicer or the Trustee, as the case may be, for expenses
reasonably incurred in respect of any breach or defect giving rise to the
repurchase obligation of the Sponsor under this Agreement that were included
in
the Repurchase Price of the Mortgage Loan, including any expenses arising
out of
the enforcement of the repurchase obligation, to the extent not otherwise
paid
pursuant to the terms hereof and (vi) any other amounts that each of the
Depositor, the Trustee, the Master Servicer, the Servicer and the Securities
Administrator is entitled to receive hereunder for reimbursement,
indemnification or otherwise.
Section
4.02 Priorities
of Distribution. (a) On each Distribution Date (or, in the case
of deposits into the Supplemental Interest Trust, on the Derivative Payment
Date), the Securities Administrator shall make the disbursements and transfers
from amounts then on deposit in the Distribution Account and from amounts
that
are available for payment to the Swap Counterparty, and shall allocate
such
amounts to the interests issued in respect of each REMIC created pursuant
to
this Agreement and shall distribute such amounts in the following order
of
priority and to the extent of the Available Funds remaining:
(i) to
the
Supplemental Interest Trust and the holders of each Class of LIBOR
Certificates in the following order of priority:
(A) from
the
Interest Remittance Amount, for deposit into the Supplemental Interest
Trust
Account, the amount of any Net Derivative Payment or Swap Termination Payment
(other than a Swap Termination Payment resulting from a Swap Counterparty
Trigger Event) owed to the Derivative Counterparty, including any such
amounts
remaining unpaid from previous Distribution Dates;
(B) concurrently:
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(1)
from
the remaining Interest Remittance Amount related to the Group I Mortgage
Loans,
to the Class I-A Certificates, the related Senior Interest Payment Amount
for
such Class of Certificates on such Distribution Date; and
(2)
from
the remaining Interest Remittance Amount related to the Group II Mortgage
Loans,
to the Class II-A-1, Class II-A-2, Class II-A-3 and Class II-A-4 Certificates,
pro
rata,
based
on the amounts distributable under this clause (i)(B)(2), the related
Senior
Interest Payment Amount for each such Class of Certificates on such Distribution
Date;
provided, that,
if the
Interest Remittance Amount for either Loan Group is insufficient to make
the
related payments set forth in clauses (i)(B)(1) or (i)(B)(2) above, any
Interest
Remittance Amount relating to the other Loan Group remaining after payment
of
the Senior Interest Payment Amount to the related Certificate Group will
be
available to cover that shortfall, such amounts to be allocated to those
Classes
experiencing such shortfall on a pro
rata
basis in
proportion to the amounts of such shortfall; and
(C) from
any
remaining Interest Remittance Amount after taking into account the distributions
made under clauses (i)(A) and (i)(B) above, sequentially, to each Class
of Class
M Certificates, in ascending order by numerical Class designation, the
Interest
Payment Amount for such Class and such Distribution Date;
(ii) (A) on
each Distribution Date (or, in the case of deposits into the Supplemental
Interest Trust, on the Derivative Payment Date) (1) before the Stepdown
Date or (2) with respect to which a Trigger Event is in effect, to the
Supplemental Interest Trust and to the holders of the Class or Classes of
LIBOR Certificates then entitled to distributions of principal as set forth
below, from amounts remaining on deposit in the Distribution Account after
making distributions pursuant to paragraph (a)(i) of this Section 4.02,
an
amount equal to, in the aggregate, the Principal Payment Amount, in the
following amounts and order of priority:
(a) for
deposit into the Supplemental Interest Trust Account, any Net Derivative
Payment
or Swap Termination Payment (other than a Swap Termination Payment resulting
from a Swap Counterparty Trigger Event) owed to the Derivative Counterparty
to
the extent unpaid pursuant to clause (a)(i)(A) of this Section
4.02;
(b) concurrently:
(1)
to
the Class I-A Certificates, the Group I Principal Payment Amount, until
the
Class Certificate Balance of the Class I-A Certificates is reduced to zero;
and
(2)
to
the Group II Certificates, the Group II Principal Payment Amount, until
their
respective Class Certificate Balances are reduced to zero, allocated in
each
case among such Classes of a Certificate Group as set forth in Section
4.02(c);
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(c) sequentially,
to each Class of Class M Certificates, in ascending order by numerical
Class designation, until their respective Class Certificate Balances are
reduced to zero;
(B) on
each
Distribution Date (or, in the case of deposits into the Supplemental Interest
Trust, on the Derivative Payment Date) on and after the Stepdown Date and
as
long as a Trigger Event is not in effect, to the Supplemental Interest
Trust and
to the holders of the Class or Classes of LIBOR Certificates then entitled
to distributions of principal, from amounts remaining on deposit in the
Distribution Account after making distributions pursuant to paragraph (a)(i)
of
this Section 4.02, an amount equal to, in the aggregate, the Principal
Payment
Amount, in the following amounts and order of priority:
(a) for
deposit into the Supplemental Interest Trust Account, any Net Derivative
Payment
or Swap Termination Payment (other than a Swap Termination Payment resulting
from a Swap Counterparty Trigger Event) owed to the Derivative Counterparty
to
the extent unpaid pursuant to clause (a)(i)(A) of this Section
4.02;
(b) concurrently:
(1)
to
the Class I-A Certificates, the Group I Senior Principal Payment Amount,
until
the Class Certificate Balance of the Class I-A Certificates is reduced
to zero;
and
(2)
to
the Group II Certificates, the Group II Senior Principal Payment Amount,
until
their respective Class Certificate Balances are reduced to zero, allocated
in
each case among such Classes of a Certificate Group as described in Section
4.02(c); and
(c) sequentially,
to each Class of Class M Certificates, in the order set forth in the
definition of Class M Principal Payment Amount, the Class M Principal
Payment Amount for the related Class of Class M certificates, until their
respective Class Certificate Balances are reduced to zero;
(iii) any
amounts remaining after the distributions in paragraphs (i) and (ii) of
this Section 4.02(a), plus, as specifically indicated below, from amounts
on
deposit in the Excess Reserve Fund Account, shall be distributed in the
following order of priority:
(A)
to
the Class A Certificates, any Senior Interest Payment Amount not paid pursuant
to clause (a)(i)(B) of this Section 4.02 allocated pro
rata
among
such Classes in proportion to the amount of the unpaid Senior Interest
Payment
Amount for such Classes;
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(B) sequentially,
to each Class of Class M Certificates, in ascending order by numerical
Class designation, to the extent not paid for such Distribution Date pursuant
to
Section 4.02(a)(i)(C), any Interest Payment Amount for any such
Class;
(C) sequentially,
to each Class of Class M Certificates, in ascending order by numerical
Class
designation, first,
any
Interest Carry Forward Amount for that Class, and second,
any
Unpaid Realized Loss Amount for that Class;
(D) to
the
Excess Reserve Fund Account, the amount of any Basis Risk Payment for such
Distribution Date;
(E) from
amounts on deposit in the Excess Reserve Fund Account with respect to such
Distribution Date, an amount equal to any unpaid Basis Risk Carryover Amount
with respect to each Class of LIBOR Certificates for such Distribution
Date,
allocated in the same order and priority as set forth in clauses (a)(i)(B)
and
(a)(i)(C) of this Section 4.02;
(F) to
the
Credit Risk Manager, the Credit Risk Manager Fee;
(G) on
the
Distribution Date occurring in July 2010 (or the next succeeding Distribution
Date on which sufficient funds are available in the Distribution Account
to make
such distributions to the Class P Certificates), $100 to the Class P
Certificates in payment of its Class P Principal Amount;
(H) to
the
Swap Counterparty, any Swap Termination Payment resulting from a Swap
Counterparty Trigger Event;
(I) to
the
holders of the Class X Certificates, the remainder of the Class X
Distributable Amount not distributed pursuant to Sections 4.02(a)(iii)(A)
through (H); and
(J) to
the
holders of the Class R Certificates, any remaining amount;
If
on any
Distribution Date, as a result of the foregoing allocation rules, any
Class of Class A Certificates does not receive in full the related
Senior Interest Payment Amount then such shortfall will be allocated to
the
Holders of such Class, with interest thereon, on future Distribution Dates,
as
Interest Carry Forward Amounts, subject to the priorities described
above.
(b) On
each
Distribution Date, prior to any distributions on any other Class of
Certificates, all amounts representing Prepayment Charges from the Mortgage
Loans received during the related Prepayment Period shall be distributed
by the
Securities Administrator to the holders of the Class P
Certificates.
(c) All
principal distributions to the holders of the Class A Certificates on any
Distribution Date prior to the Stepdown Date will be allocated concurrently
to
(i) the Group I Certificates and (ii) the Group II Certificates based on
the
Group Principal Allocation Percentage for the Group I Certificates and
the Group
II Certificates, as applicable, for that Distribution Date. On or after
the
Stepdown Date, as long as no Trigger Event is in effect, principal distributions
to the holders of the Certificates of either Certificate Group will be
determined based on the Group I Senior Principal Payment Amount or Group
II
Senior Principal Payment Amount, as applicable. However, if the Class
Certificate Balances of the Certificates in either Certificate Group are
reduced
to zero before the Stepdown Date, then the remaining amount of principal
distributions distributable to the Certificates of the retired Certificate
Group
on that Distribution Date, and on all subsequent Distribution Dates, will
be
distributed to the holders of the Certificates in the other Certificate
Group
remaining outstanding, in accordance with the principal distribution priorities
described in Section 4.02(a)(ii)(A)(b) for such Certificate Group and this
Section 4.02(c). If the Class Certificate Balances of the Certificates
in either
Certificate Group are reduced to zero on or after the Stepdown Date, then
the
remaining Principal Payment Amount distributable to the Certificates of
the
retired Certificate Group on that Distribution Date, and all subsequent
Distribution Dates, will be distributed to the holders of the Certificates
of
the Certificate Group remaining outstanding, in accordance with the priorities
described in Section 4.02(a)(ii)(B)(b) for such Certificate Group and this
Section 4.02(c), except that the remaining Certificate Group’s Senior Principal
Payment Amount will be computed without regard to that Certificate Group’s
Principal Payment Amount.
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Any
principal distributions allocated to the Group II Certificates will be
allocated
sequentially as follows:
(i) to
the
Class II-A-1 Certificates, until the Class Certificate Balance of such
Class has
been reduced to zero;
(ii)
to the
Class II-A-2 Certificates, until the Class Certificate Balance of such
Class has
been reduced to zero;
(iii) to
the
Class II-A-3 Certificates, until the Class Certificate Balance of such
Class has
been reduced to zero; and
(iv) to
the
Class II-A-4 Certificates, until the Class Certificate Balance of such
Class has
been reduced to zero.
Notwithstanding
the above paragraph, on and after the Distribution Date on which the aggregate
Class Certificate Balances of the Class M Certificates and the
Overcollateralization Amount have been reduced to zero, any principal
distributions allocated to the Group II Certificates are required to be
allocated pro
rata
among
the Classes of Group II Certificates, based upon their respective Class
Certificate Balances.
(d) On
any
Distribution Date, any Relief Act Shortfalls and Net Prepayment Interest
Shortfalls for such Distribution Date shall be allocated by the Securities
Administrator as a reduction in the following order:
(i) First,
to the
amount of interest payable to the Class X Certificates; and
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(ii) Second,
pro
rata,
as a
reduction of the Interest Payment Amount for the Class A and Class M
Certificates, based on the amount of interest to which such Classes would
otherwise be entitled.
(e) On
any
Distribution Date (or any Derivative Payment Date, as applicable), the
Securities Administrator shall distribute any Swap Amount and Cap Amount
for
such date as follows:
(i) to
the
Derivative Counterparty, any Net Derivative Payment owed to the Derivative
Counterparty pursuant to the Swap Agreement for such Derivative Payment
Date to
the extent not previously paid pursuant to Sections 4.02(a)(i)(A),
4.02(a)(ii)(A) or 4.02(a)(ii)(B);
(ii) to
the
Swap Counterparty, any Swap Termination Payment not resulting from a Swap
Counterparty Trigger Event owed to the Swap Counterparty pursuant to the
Swap
Agreement for such Derivative Payment Date;
(iii) to
the
extent not paid and in the order of priority provided in clauses (a)(i)(B)
and
(a)(i)(C) of this Section 4.02, to the Class A Certificates any Senior
Interest
Payment Amounts, and to the Class M Certificates, in ascending order by
numerical class designation, any Interest Payment Amounts;
(iv) to
the
Class A Certificates and the Class M Certificates in the order of priority
set
forth in clauses (a)(ii)(A)(b), (a)(ii)(A)(c), (a)(ii)(B)(b) and (a)(ii)(B)(c)
of this Section 4.02, an amount necessary to maintain the Overcollateralization
Target Amount for such Distribution Date after giving effect to distributions
pursuant to such clauses;
(v) to
the
extent not paid and in the order of priority provided in clause (a)(iii)(C)
of
this Section 4.02, sequentially, to each Class of Class M Certificates,
in
ascending order by numerical Class designation, first,
any
Interest Carry Forward Amount for that Class, and second,
any
Unpaid Realized Loss Amount for that Class;
(vi) to
the
extent not paid and in the order of priority provided in clause (a)(iii)(D)
of
this Section 4.02, to the Excess Reserve Fund Account, the amount of any
Basis
Risk Payment for such Distribution Date;
(vii) to
the
extent not paid and in the order of priority provided in clause (a)(iii)(E)
of
this Section 4.02, to the LIBOR Certificates, any remaining unpaid Basis
Risk
Carryover Amount with respect to such Certificates for that Distribution
Date,
allocated in the same order and priority as set forth in such
clause;
(viii) to
the
extent not paid and in the order of priority provided in clause (a)(iii)(F)
of
this Section 4.02, to the Credit Risk Manager, the Credit Risk Manager
Fee;
(ix) if
applicable, to the Swap Termination Receipts Account or Cap Termination
Receipts
Account for application to the purchase of a replacement swap agreement
or
replacement cap agreement pursuant to Section 4.08;
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(x) to
the
extent not paid and in the order of priority provided in clause (a)(iii)(H)
of
this Section 4.02, to the Swap Counterparty, any Swap Termination Payment
resulting from a Swap Counterparty Trigger Event; and
(xi) to
the
extent not paid pursuant to clause (a)(iii)(I) of this Section 4.02, to
the
holders of the Class X Certificates, the remainder of the Class X
Distributable Amount.
With
respect to each Distribution Date, the sum of all amounts distributed in
priorities (e)(iv) and (e)(v) second
of this
Section 4.02(e) cannot exceed the amount of cumulative Realized Losses
incurred
up to such Distribution Date minus any distributions made on previous
Distribution Dates pursuant to such priorities.
Section
4.03 Monthly
Statements to Certificateholders. (a) Not
later than each Distribution Date, the Securities Administrator shall make
available to each Certificateholder, the Master Servicer, the Servicer,
the
Depositor, the Credit Risk Manager, the Trustee, the Derivative Counterparty
and
each Rating Agency a statement, based on information provided by the Servicer
and the Derivative Counterparty, setting forth with respect to the related
distribution:
(i) the
amount thereof allocable to principal, separately identifying the aggregate
amount of any Principal Prepayments, Liquidation Proceeds and Subsequent
Recoveries;
(ii) the
amount thereof allocable to interest, any Interest Carry Forward Amounts
included in such distribution and any remaining Interest Carry Forward
Amounts
after giving effect to such distribution, any Basis Risk Carryover Amount
for
such Distribution Date and the amount of all Basis Risk Carryover Amount
covered
by withdrawals from the Excess Reserve Fund Account on such Distribution
Date;
(iii) if
the
distribution to the Holders of such Class of Certificates is less than the
full amount that would be distributable to such Holders if there were sufficient
funds available therefor, the amount of the shortfall and the allocation
thereof
as between principal and interest, including any Basis Risk Carryover Amount
not
covered by amounts in the Excess Reserve Fund Account;
(iv) the
Class Certificate Balance of each Class of Certificates after giving
effect to the distribution of principal on such Distribution Date;
(v) the
Pool
Stated Principal Balance for the following Distribution Date;
(vi) the
amount of the Expense Fees (in the aggregate and separately stated) paid
to or
retained by the Servicer, any Subservicer and the Master Servicer with
respect
to such Distribution Date;
(vii) the
Interest Rate for each such Class of Certificates with respect to such
Distribution Date;
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(viii) the
amount of P&I Advances included in the distribution on such Distribution
Date and the aggregate amount of P&I Advances outstanding as of the close of
business on the Determination Date immediately preceding such Distribution
Date;
(ix) by
Loan
Group and in the aggregate, the number and aggregate outstanding principal
balances of Mortgage Loans (except those Mortgage Loans that are liquidated
as
of the end of the related Prepayment Period) (1) as to which the Scheduled
Payment is delinquent 31 to 60 days, 61 to 90 days and 91 or
more days, (2) that have become REO Property, (3) that are in
foreclosure and (4) that are in bankruptcy, in each case as of the close of
business on the last Business Day of the immediately preceding month
calculated
in accordance with the OTS method (regardless of the format used by the
Servicer
to report to the Securities Administrator);
(x) by
Loan
Group and in the aggregate, with respect to Mortgage Loans that became
REO
Properties during the preceding calendar month, the number and the aggregate
Stated Principal Balance of such Mortgage Loans as of the close of business
on
the Determination Date preceding such Distribution Date and the date of
acquisition thereof;
(xi) by
Loan
Group and in the aggregate, the total number and aggregate principal balance
of
any REO Properties as of the close of business on the Determination Date
preceding such Distribution Date;
(xii) whether
a
Trigger Event has occurred and is continuing;
(xiii) the
amount on deposit in the Excess Reserve Fund Account (after giving effect
to
distributions on such Distribution Date);
(xiv) in
the
aggregate and for each Class of Certificates, the aggregate amount of
Applied Realized Loss Amounts incurred during the preceding calendar month
and
aggregate Applied Realized Loss Amounts through such Distribution
Date.;
(xv) the
amount of any Net Monthly Excess Cash Flow on such Distribution Date and
the
allocation thereof to the Certificateholders with respect to Applied Realized
Loss Amounts and Interest Carry Forward Amounts;
(xvi) the
Overcollateralization Amount and Overcollateralization Target
Amount;
(xvii) Prepayment
Charges collected by the Servicer;
(xviii) the
Cumulative Loss Percentage and the Rolling Three Month Delinquency
Rate;
(xix) the
amount of Credit Risk Management Fees paid during the Due Period to which
such
Distribution Date relates;
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(xx) the
aggregate amount of any insurance claim payments received with respect
to any
Primary Mortgage Insurance Policy during the related Collection Period;
and
(xxi) the
amount of any Net Derivative Payment made to the Supplemental Interest
Trust
pursuant to Section 4.02, any Net Derivative Payment made to the Derivative
Counterparty pursuant to Section 4.02, any Swap Termination Payment or
Cap
Termination Payment made to the Supplemental Interest Trust pursuant to
Section
4.02 and any Swap Termination Payment made to the Swap Counterparty pursuant
to
Section 4.02.
(a) For
purposes of preparing the Monthly Statement, delinquencies shall be determined
and reported by the Master Servicer based on the so-called “OTS” methodology
irrespective of the method for determining delinquencies utilized by the
Servicer on mortgage loans similar to the Mortgage Loans. By way of example,
a
Mortgage Loan would be delinquent with respect to a Scheduled Payment due
on a
Due Date if such Scheduled Payment is not made by the close of business
on the
Mortgage Loan’s next succeeding Due Date, and a Mortgage Loan would be more than
30-days Delinquent with respect to such Scheduled Payment if such Scheduled
Payment were not made by the close of business on the Mortgage Loan’s second
succeeding Due Date.
(b) The
Securities Administrator’s responsibility for making available the above
statement to the Certificateholders, each Rating Agency, the Master Servicer,
the Servicer, the Trustee and the Depositor is limited to the availability,
timeliness and accuracy of the information derived from the Master Servicer
and
the Servicer. The Securities Administrator will provide the above statement
via
the Securities Administrator’s internet website. The Securities Administrator’s
website will initially be located at ▇▇▇▇▇://▇▇▇.▇▇▇▇▇▇▇.▇▇▇
and
assistance in using the website can be obtained by calling the Securities
Administrator’s customer service desk at (▇▇▇) ▇▇▇-▇▇▇▇. Parties that are unable
to use the above distribution method 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 shall have the right to change the manner
in
which the above statement is distributed in order to make such distribution
more
convenient and/or more accessible, and the Securities Administrator shall
provide timely and adequate notification to the Certificateholders and
the
parties hereto regarding any such changes. A paper copy of the statement
will
also be made available upon request.
(c) Within
a
reasonable period of time after the end of each calendar year, the Securities
Administrator shall, upon request, cause to be furnished 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), (a)(ii) and (a)(vi)
of this Section 4.03 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
have
previously been provided by the Securities Administrator pursuant to any
requirements of the Code as from time to time in effect.
(d) On
the
10th
day of
each calendar month (or, if such 10th
day is
not a Business Day, then on the next succeeding Business Day), the Servicer
shall furnish to the Master Servicer (i) a monthly remittance advice in
the
format set forth in Exhibit N-1 hereto, (ii) a monthly defaulted loan report
in
the format set forth in Exhibit N-2 hereto (or in such other format mutually
agreed to between the Servicer and the Master Servicer) and (iii) a realized
loss report in the format set forth in Exhibit N-3 hereto (or in such other
format mutually agreed to between the Servicer and the Master Servicer)
relating
to the period ending on the last day of the preceding calendar month in
a media
reasonably acceptable to the Master Servicer.
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The
Depositor shall have the right upon providing ten Business Days prior
written
notice to the Servicer to receive any report provided by the Servicer
to the
Master Servicer under this Section 4.03(d) and to disseminate or otherwise
utilize such information in its discretion, subject to applicable laws
and
regulations.
Section
4.04 Certain
Matters Relating to the Determination of LIBOR. LIBOR shall be calculated by
the Securities Administrator in accordance with the definition of LIBOR.
Until
all of the LIBOR Certificates are paid in full, the Securities Administrator
will at all times retain at least four Reference Banks for the purpose
of
determining LIBOR with respect to each LIBOR Determination Date. The
Securities
Administrator initially shall designate the Reference Banks (after consultation
with the Depositor). Each “Reference
Bank”
shall
be a leading bank engaged in transactions in Eurodollar deposits in the
international Eurocurrency market, shall not control, be controlled by,
or be
under common control with, the Securities Administrator and shall have
an
established place of business in London. If any such Reference Bank should
be
unwilling or unable to act as such or if the Securities Administrator
should
terminate its appointment as Reference Bank, the Securities Administrator
shall
promptly appoint or cause to be appointed another Reference Bank (after
consultation with the Depositor). The Securities Administrator shall
have no
liability or responsibility to any Person for (i) the selection of any
Reference Bank for purposes of determining LIBOR or (ii) any inability to
retain at least four Reference Banks which is caused by circumstances
beyond its
reasonable control.
The
Interest Rate for each Class of LIBOR Certificates for each Interest
Accrual Period shall be determined by the Securities Administrator on each
LIBOR
Determination Date so long as the LIBOR Certificates are outstanding on
the
basis of LIBOR and the respective formulae appearing in footnotes corresponding
to the LIBOR Certificates in the table relating to the Certificates in
the
Preliminary Statement. The Securities Administrator shall not have any
liability
or responsibility to any Person for its inability, following a good-faith
reasonable effort, to obtain quotations from the Reference Banks or to
determine
the arithmetic mean referred to in the definition of LIBOR, all as provided
for
in this Section 4.04 and the definition of LIBOR. The establishment of
LIBOR and each Interest Rate for the LIBOR Certificates by the Securities
Administrator shall (in the absence of manifest error) be final, conclusive
and
binding upon each Holder of a Certificate and the Trustee.
Section
4.05 Allocation
of Applied Realized Loss Amounts. Any Applied Realized Loss Amounts shall be
allocated by the Securities Administrator to the most junior Class of
Class M Certificates then outstanding in reduction of the
Class Certificate Balance thereof.
Section
4.06 Supplemental
Interest Trust. (a)
A
separate trust is hereby established (the “Supplemental
Interest Trust”),
the
corpus of which shall be held by the Supplemental Interest Trust Trustee
for the
benefit of the Class X Certificateholders. The Securities Administrator
is
hereby appointed Supplemental Interest Trust Trustee. The Supplemental
Interest
Trust Trustee shall establish an account (the “Supplemental Interest Trust
Account”) consisting of two sub-accounts (the “Swap
Account”
and
the
“Cap
Account,”
respectively), into each of which the Depositor shall deposit $500 on the
Closing Date. The Supplemental Interest Trust Account 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 monies, including, without limitation,
other monies of the Securities Administrator held pursuant to this Agreement.
(b) In
addition, the Supplemental Interest Trust Trustee shall establish a collateral
account (the “Collateral
Account”).
The
Collateral Account 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 monies, including, without limitation, other monies of the Securities
Administrator held pursuant to this Agreement.
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(c) The
Supplemental Interest Trust Trustee shall deposit into the Swap Account
any Net
Derivative Payment required pursuant to Sections 4.02(a)(i)(A),
4.02(a)(ii)(A)(a) and 4.02(a)(ii)(B)(a), any Swap Termination Payment required
pursuant to Sections 4.02(a)(i)(A), 4.02(a)(ii)(A)(a), 4.02(a)(ii)(B)(a)
and
4.02(a)(iii)(H), and any amounts received from the Swap Counterparty under
the
Swap Agreement, and shall distribute from the Supplemental Interest Trust
Account any Net Derivative Payment required pursuant to Section 4.02(e)(i)
or
any Swap Termination Payment required pursuant to Sections 4.02(e)(ii)
or
4.02(e)(x), as applicable.
(d) The
Supplemental Interest Trust Trustee shall deposit into the Cap Account
any
amounts received from the Cap Counterparty under the Cap Agreement.
(e) Funds
in
the Swap Account shall be invested in Permitted Investments constituting
time
deposits under clause (ii) of the definition thereof. Any earnings on such
amounts shall be distributed on each Distribution Date pursuant to Section
4.02(e). The Class X Certificates shall evidence ownership of the Swap
Account
for federal income tax purposes and the Holder thereof shall direct the
Supplemental Interest Trust Trustee, in writing, as to investment of amounts
on
deposit therein. The Sponsor shall be liable for any losses incurred on
such
investments. In the absence of written instructions from the Class X
Certificateholders as to investment of funds on deposit in the Swap Account,
such funds shall be invested in the ▇▇▇▇▇ Fargo Advantage Prime Investment
Money
Market Fund or a comparable investment vehicle. Any amounts on deposit
in the
Swap Account in excess of the Swap Amount on any Distribution Date shall
be held
for distribution pursuant to Section 4.02(e) on the following Distribution
Date.
(f) Funds
in
the Cap Account shall be invested in Permitted Investments constituting
time
deposits under clause (ii) of the definition thereof. Any earnings on such
amounts shall be distributed on each Distribution Date pursuant to Section
4.02(e). The Class X Certificates shall evidence ownership of the Cap Account
for federal income tax purposes and the Holder thereof shall direct the
Supplemental Interest Trust Trustee, in writing, as to investment of amounts
on
deposit therein. The Sponsor shall be liable for any losses incurred on
such
investments. In the absence of written instructions from the Class X
Certificateholders as to investment of funds on deposit in the Cap Account,
such
funds shall be invested in the ▇▇▇▇▇ Fargo Advantage Prime Investment Money
Market Fund or a comparable investment vehicle. Any amounts on deposit
in the
Cap Account in excess of the Cap Amount on any Distribution Date shall
be held
for distribution pursuant to Section 4.02(e) on the following Distribution
Date.
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(g) Funds
required to be held pursuant to the Credit Support Annex shall be deposited
into
the Collateral Account. Funds in the form of cash posted by the Cap Counterparty
(or its credit support provider) and/or the Swap Counterparty (or its
credit
support provider) in the Collateral Account shall be invested in Permitted
Investments at the written direction of the Cap Counterparty and/or Swap
Counterparty, as applicable. Any interest earnings on such amounts shall
be
remitted to the Cap Counterparty and/or Swap Counterparty, as applicable,
pursuant to the terms of the Credit Support Annex. The Supplemental Interest
Trust Trustee shall not be liable for any losses incurred on such investments.
In the absence of prior written instructions from the Cap Counterparty
(or its
credit support provider) and/or the Swap Counterparty (or its credit
support
provider) as to investment of funds on deposit in the Collateral Account,
such
funds shall be invested in the ▇▇▇▇▇ Fargo Advantage Prime Investment
Money
Market Fund or a comparable investment vehicle. On the Distribution Date
immediately following a Swap Payment Date where a shortfall exists with
respect
to a Net Swap Payment or a Swap Termination Payment owed by the Swap
Counterparty as a result of its failure to make payments pursuant to
the Swap
Agreement, amounts necessary to cover such shortfall shall be removed
from the
Collateral Account, remitted to the Swap Account and distributed as all
or a
portion of such Net Swap Payment or Swap Termination Payment pursuant
to Section
4.02(e). On the Distribution Date where a shortfall exists with respect
to Cap
Amounts owed by the Cap Counterparty as a result of its failure to make
payments
pursuant to the Cap Agreement, amounts necessary to cover such shortfall
shall
be removed from the Collateral Account, remitted to the Cap Account and
distributed as all or a portion of such Cap Amount pursuant to Section
4.02(e).
Any amounts on deposit in the Collateral Account required to be returned
to the
Cap Counterparty (or its credit support provider) and/or the Swap Counterparty
(or its credit support provider), as applicable, as a result of (i) the
termination of the Swap Agreement or Cap Agreement, as applicable, (ii)
the
procurement of a guarantor, (iii) the reinstatement of required ratings
or (iv)
otherwise pursuant to the Swap Agreement, shall be released directly
to the Swap
Counterparty and/or the Cap Counterparty, as applicable, pursuant to
the terms
of the Credit Support Annex
(h) Upon
termination of the Trust Fund, any amounts remaining in the Swap Account
or the
Cap Account shall be distributed pursuant to the priorities set forth in
Section
4.02(e).
(i) It
is the
intention of the parties hereto that, for federal and state income and
state and
local franchise tax purposes, the Supplemental Interest Trust be disregarded
as
an entity separate from the holder of the Class X Certificates unless and
until
the date when either (i) there is more than one Class X Certificateholder
or
(ii) any Class of Certificates in addition to the Class X Certificates
is
recharacterized as an equity interest in the Supplemental Interest Trust
for
federal income tax purposes. Neither the Securities Administrator nor the
Trustee shall be responsible for any entity level tax reporting for the
Supplemental Interest Trust.
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(j) Any
obligation of the Securities Administrator with respect to the Supplemental
Interest Trust under the Swap Agreement or Cap Agreement shall be deemed
to be
an obligation of the Supplemental Interest Trust.
(k) In
the
event that the Swap Counterparty or the Cap Counterparty fails to perform
any of
its obligations under the Swap Agreement and the Cap Agreement, respectively,
(including, without limitation, its obligations to make any payment or
transfer
collateral), or breaches any of its representations and warranties under
the
Swap Agreement or the Cap Agreement, as applicable, or in the event that
an
Event of Default, Termination Event, or Additional Termination Event
occurs (as
such terms are defined in the Swap Agreement and the Cap Agreement),
the
Supplemental Interest Trust Trustee shall, no later than the next Business
Day
following such failure, breach or occurrence, to the extent it has actual
knowledge, of any such failure, breach or occurrence, notify the Swap
Counterparty or Cap Counterparty, as applicable, and make any demand
for payment
pursuant to the Swap Agreement or Cap Agreement, as applicable. In the
event
that the Swap Counterparty’s or Cap Counterparty’s obligations are at any time
guaranteed by a third party, then to the extent that the Swap Counterparty
or
Cap Counterparty fails to make any payment or delivery required under
terms of
the Swap Agreement or the Cap Agreement, as applicable, the Supplemental
Interest Trust Trustee shall, to the extent it has actual knowledge,
of any such
failure, breach or occurrence, no later than the next Business Day following
such failure, demand that such guarantor make any and all payments then
required
to be made by the applicable guarantor.
Section
4.07 Rights
of the Swap Counterparty.
The Swap
Counterparty shall be deemed a third-party beneficiary of this Agreement
to the
same extent as if it were a party hereto and shall have the right to enforce
its
rights under this Agreement, which rights include but are not limited to
the
obligation of the Supplemental Interest Trust Trustee (A) to deposit any
Net
Derivative Payment required pursuant to Sections 4.02(a)(i)(A),
4.02(a)(ii)(A)(a) and 4.02(a)(ii)(B)(a), and any Swap Termination Payment
required pursuant to Sections 4.02(a)(i)(A), 4.02(a)(ii)(A)(a),
4.02(a)(ii)(B)(a) and 4.02(a)(iii)(H), into the Supplemental Interest Trust
Account (B) to pay any Net Derivative Payment required pursuant to Section
4.02(e)(i) or Swap Termination Payment required pursuant to Sections 4.02(e)(ii)
or Section 4.02(e)(x), as applicable, to the Swap Counterparty and (C)
to
establish and maintain the Swap Account, to make such deposits thereto,
investments therein and distributions therefrom as are required pursuant
to
Section 4.06. For the protection and enforcement of the provisions of this
Section the Swap Counterparty shall be entitled to such relief as can be
given
either at law or in equity.
Section
4.08 Termination
Receipts. (a)(i) In the event of an “Early Termination Event” as defined
under the Swap Agreement, (a) any Swap Termination Payment made by the
Swap
Counterparty to the Swap Account and paid pursuant to Section 4.02(e)(ix)
(“Swap
Termination Receipts”)
will
be deposited in a segregated non-interest bearing account which shall be
an
Eligible Account established by the Securities Administrator (the “Swap
Termination Receipts Account”)
and
(b) any amounts received from a replacement swap counterparty (“Swap
Replacement Receipts”)
will
be deposited in a segregated non-interest bearing account which shall be
an
Eligible Account established by the Securities Administrator (the “Swap
Replacement Receipts Account”).
The
Securities Administrator shall invest, or cause to be invested, funds held
in
the Swap Termination Receipts Account and the Swap Replacement Receipts
Account
in time deposits of the Securities Administrator as permitted pursuant
to clause
(ii) of the definition of Permitted Investments or as otherwise directed
in
writing by a majority of the Certificateholders. All such Permitted Investments
must be payable on demand or mature on a Distribution Date or such other
date as
directed by the Certificateholders. All such Permitted Investments will
be made
in the name of the Supplemental Interest Trust Trustee (in its capacity
as such)
or its nominee. All income and gain realized from any such investment shall
be
deposited in the Termination Receipts Account or the Replacement Receipts
Account, as applicable, and all losses, if any, shall be borne by the related
account.
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(ii) Unless
otherwise permitted by the Rating Agencies as evidenced in a written
confirmation, the Depositor shall arrange for replacement swap agreement(s)
or
procure a replacement guarantor, if applicable, and the Securities Administrator
shall promptly, with the assistance and cooperation of the Depositor, use
amounts on deposit in the Swap Termination Receipts Account, if necessary,
to
enter into replacement swap agreement(s) or to execute any other agreements
with
respect to such replacement guarantor, if applicable, which shall be executed
and delivered by the Supplemental Interest Trust Trustee upon receipt of
written
confirmation from each Rating Agency (if required pursuant to the terms
of the
Swap Agreement) that such replacement swap agreement(s) will not result
in the
reduction or withdrawal of the rating of any outstanding Class of Certificates
with respect to which it is a Rating Agency.
Amounts
on deposit in the Swap Replacement Receipts Account shall be held for the
benefit of the related Swap Counterparty and paid to such Swap Counterparty
if
the Supplemental Interest Trust is required to make a payment to such Swap
Counterparty following an event of default or termination event with respect
to
the Supplemental Interest Trust under the related Swap Agreement. Any amounts
not so applied shall, following the termination or expiration of such Swap
Agreement, be paid to the Class X Certificates.
(b) (i)
In
the event of an “Termination Event” as defined under the Cap Agreement, (a) any
Cap Termination Payment made by the Cap Counterparty to the Cap Account
and paid
pursuant to Section 4.02(e)(ix) (“Cap Termination Receipts”) shall be deposited
in a segregated non-interest bearing account which shall be an Eligible
Account
established by the Securities Administrator (the “Cap Termination Receipts
Account”) and (b) any amounts received from a replacement cap counterparty (“Cap
Replacement Receipts”) will be deposited in a segregated non-interest bearing
account which shall be an Eligible Account established by the Securities
Administrator (the “Cap Replacement Receipts Account”). The Securities
Administrator shall invest, or cause to be invested, funds held in the
Cap
Termination Receipts Account in time deposits of the Securities Administrator
as
permitted by clause (ii) of the definition of Permitted Investments or
as
otherwise directed in writing by a majority of the Certificateholders.
All such
Permitted Investments must be payable on demand or mature on a Cap Payment
Date,
a Distribution Date or such other date as directed by the Certificateholders.
All such Permitted Investments shall be made in the name of the Supplemental
Interest Trust Trustee (in its capacity as such) or its nominee. All income
and
gain realized from any such investment shall be deposited in the Cap Termination
Receipts Account and all losses, if any, shall be borne by such account.
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(ii) Unless
otherwise permitted by the Rating Agencies as evidenced in a written
confirmation, the Depositor shall arrange for one or more replacement interest
rate cap agreements and the Securities Administrator shall promptly, with
the
assistance and cooperation of the Depositor, use amounts on deposit in
the Cap
Termination Receipts Account, if necessary, to enter into any such replacement
interest rate cap agreement which shall be executed and delivered by the
Supplemental Interest Trust Trustee upon receipt of written confirmation
from
each Rating Agency that any such replacement interest rate cap agreement
will
not result in the reduction or withdrawal of the rating of any outstanding
Class
of Certificates with respect to which it is a Rating Agency
ARTICLE
V
THE
CERTIFICATES
Section
5.01 The
Certificates. The Certificates shall be substantially in the forms attached
hereto as exhibits. The Certificates shall be issuable in registered form,
in
the minimum denominations, integral multiples in excess thereof (except
that one
Certificate in each Class may be issued in a different amount) and
aggregate denominations per Class set forth in the Preliminary
Statement.
The
Depositor hereby directs the Securities Administrator to register the
Class X, Class P and Class R Certificates in the name of HSBC
Securities (USA) Inc. or its designee. On a date as to which the Depositor
notifies the Securities Administrator, the Securities Administrator shall
transfer the Class X and Class P Certificates in the name of the NIM
Trustee, or such other name or names as the Depositor shall request, and
to
deliver the Class X and Class P Certificates to the NIM Trustee or to
such other Person or Persons as the Depositor shall request.
Subject
to Section 11.02 respecting the final distribution on the Certificates, on
each Distribution Date the Securities Administrator shall make distributions
to
each Certificateholder of record on the preceding Record Date either (x) by
wire transfer in immediately available funds to the account of such holder
at a
bank or other entity having appropriate facilities therefor, if such Holder
has
so notified the Securities Administrator at least five Business Days prior
to
the related Record Date or (y) by check mailed by first Class mail to such
Certificateholder at the address of such holder appearing in the Certificate
Register; provided,
however,
so long
as such Certificate is a Book-Entry Certificate, all distributions on such
Certificate will be made through the Depository or the Depository
Participant.
The
Certificates shall be executed by manual or facsimile signature on behalf
of the
Securities Administrator by an authorized officer. Certificates bearing
the
manual or facsimile signatures of individuals who were, at the time such
signatures were affixed, authorized to sign on behalf of the Securities
Administrator shall bind the Securities Administrator, notwithstanding
that such
individuals or any of them have ceased to be so authorized prior to the
authentication and delivery of any such Certificates or did not hold such
offices at the date of such Certificate. No Certificate shall be entitled
to any
benefit under this Agreement, or be valid for any purpose, unless authenticated
by the Securities Administrator by manual signature, and such authentication
upon any Certificate shall be conclusive evidence, and the only evidence,
that
such Certificate has been duly executed and delivered hereunder. All
Certificates shall be dated the date of their authentication. On the Closing
Date, the Securities Administrator shall authenticate the Certificates
to be
issued at the direction of the Depositor, or any affiliate thereof.
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Section
5.02 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 5.06, a Certificate
Register for the Trust Fund 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 execute and deliver, in the name of the designated
transferee or transferees, one or more new Certificates of the same
Class and 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 which 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
cancelled 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 said Act and such state securities laws. In determining whether a
transfer
is being made pursuant to an effective registration statement, the Securities
Administrator shall be entitled to rely solely upon a written notice to
such
effect from the Depositor. Except with respect to (i) the transfer of the
Class X, Class P or Class R Certificates to the Depositor or an
Affiliate of the Depositor, (ii) the transfer of the Class X or
Class P Certificates to the NIM Issuer or the NIM Trustee, or (iii) a
transfer of the Class X or Class P Certificates from the NIM Issuer or
the NIM Trustee to the Depositor or an Affiliate of the Depositor, in the
event
that a transfer of a Private Certificate which is a Physical Certificate
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 shall certify to the
Securities Administrator in writing the facts surrounding the transfer
in
substantially the form set forth in Exhibit H (the “Transferor
Certificate”)
and
either (i) there shall be delivered to the Securities Administrator a
letter in substantially the form of Exhibit I-A (the “Rule 144A
Investment Letter”)
or
Exhibit I-B (the “Regulation
S Investment Letter”)
or
(ii) there shall be delivered to the Securities Administrator at the
expense of the transferor an Opinion of Counsel stating that such transfer
may
be made without registration under the Securities Act. In the event that
a
transfer of a Private Certificate which is a Book-Entry Certificate 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 will be deemed to have
made
as of the transfer date each of the certifications set forth in the Transferor
Certificate in respect of such Certificate and the transferee will be deemed
to
have made as of the transfer date each of the certifications set forth
in the
Rule 144A Investment Letter or Regulation S Investment Letter, as
applicable, in respect of such Certificate, in each case as if such Certificate
were evidenced by a Physical Certificate. As directed by the Depositor,
the
Securities Administrator 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 Depositor, the Master Servicer, the
Servicer and the Trustee shall cooperate with the Securities Administrator
in
providing the Rule 144A information referenced in the preceding sentence,
including providing to the Securities Administrator such information regarding
the Certificates, the Mortgage Loans and other matters regarding the Trust
Fund
as the Securities Administrator shall reasonably determine 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 Trustee, the Servicer, the Master Servicer
and the
Depositor 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.
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Except
with respect to (i) the transfer of the Class X, Class P or
Class R Certificates to the Depositor or an Affiliate of the Depositor,
(ii) the transfer of the Class X or Class P Certificates to the
NIM Issuer or the NIM Trustee, or (iii) a transfer of the Class X or
Class P Certificates from the NIM Issuer or the NIM Trustee to the
Depositor or an Affiliate of the Depositor, 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 (in the event such Certificate is a Private Certificate
or a Residual Certificate, such requirement is satisfied only by the Securities
Administrator’s receipt of a representation letter from the transferee
substantially in the form of Exhibit I-A or Exhibit I-B), to the effect
that such transferee is not an employee benefit plan or arrangement subject
to
Section 406 of ERISA, a plan subject to Section 4975 of the Code or a
plan subject to any Federal, state or local law (“Similar
Law”)
materially similar to the foregoing provisions of ERISA or the Code, nor
a
person acting on behalf of any such plan or arrangement nor using the assets
of
any such plan or arrangement to effect such transfer, or (ii) in the case
of an ERISA-Restricted Certificate (other than a Residual Certificate,
Class X
Certificate or a Class P Certificate) that has been the subject of an
ERISA-Qualifying Underwriting, and the purchaser is an insurance company,
a
representation that the purchaser is an insurance company that is purchasing
such Certificates with funds contained in an “insurance company general account”
(as such term is defined in Section V(e) of Prohibited Transaction
Class Exemption (“PTCE”)
95-60)
and that the purchase and holding of such Certificates are covered under
Sections I and III of PTCE 95-60 or (iii) in the case of any such
ERISA-Restricted Certificate other than a Residual Certificate, Class X
Certificate or Class P Certificate presented for registration in the name
of an employee benefit plan subject to Title I of ERISA, a plan or
arrangement subject to Section 4975 of the Code (or comparable provisions
of any subsequent enactments), or a plan subject to Similar Law, or a trustee
of
any such plan or any other person acting on behalf of any such plan or
arrangement or using such plan’s or arrangement’s assets, an Opinion of Counsel
satisfactory to the Securities Administrator, which Opinion of Counsel
shall not
be an expense of the Depositor, the Trustee, the Master Servicer, the Servicer,
the Securities Administrator or the Trust Fund, addressed to the Securities
Administrator, to the effect that the purchase or holding of such
ERISA-Restricted Certificate will not constitute or result in a non-exempt
prohibited transaction within the meaning of ERISA, Section 4975 of the
Code or any Similar Law and will not subject the Trustee, the Depositor,
the
Securities Administrator, the Master Servicer or the Servicer to any obligation
in addition to those expressly undertaken in this Agreement or to any liability.
For purposes of the preceding sentence, with respect to an ERISA-Restricted
Certificate that is not a Physical Certificate or a Residual Certificate,
in the
event the representation letter referred to in the preceding sentence is
not
furnished, such representation shall be deemed to have been made to the
Securities Administrator by the transferee’s (including an initial acquirer’s)
acceptance of the ERISA-Restricted Certificates. Notwithstanding anything
else
to the contrary herein, (a) any purported transfer of an ERISA-Restricted
Certificate that is a Physical Certificate, other than a Class P
Certificate, Class X Certificate or Residual Certificate, to or on behalf
of an
employee benefit plan subject to ERISA, the Code or Similar Law without
the
delivery to the Securities Administrator of a representation letter or
an
Opinion of Counsel satisfactory to the Securities Administrator as described
above shall be void and of no effect and (b) any purported transfer of a
Class P Certificate, Class X Certificate or Residual Certificate to a
transferee that does not make the representation in clause (i) above
shall be void and of no effect.
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None
of
the Class R, Class X or Class P Certificates may be sold to any
employee benefit plan subject to Title I of ERISA, any plan subject to
Section 4975 of the Code, or any plan subject to any Similar Law or any
person investing on behalf or with plan assets of such plan.
No
transfer of an ERISA-Restricted Trust Certificate prior to the termination
of
the Cap Agreement and the Swap Agreement shall be made unless the Securities
Administrator shall have received a representation letter from the transferee
of
such Certificate, substantially in the form set forth in Exhibit I-A or
Exhibit
I-B, to the effect that either (i) such transferee is neither an employee
benefit plan or arrangement subject to Section 406 of ERISA, a plan subject
to
Section 4975 of the Code or a plan subject to Similar Law nor a Person
acting on
behalf of any such Plan or using the assets of any such Plan to effect
such
transfer or (ii) the acquisition and holding of the ERISA-Restricted Trust
Certificate are eligible for exemptive relief under the statutory exemption
for
non-fiduciary service providers under Section 408(b)(17) of ERISA and Section
4975(d)(20) of the Code, ▇▇▇▇ ▇▇-▇▇, ▇▇▇▇ ▇▇-▇, ▇▇▇▇ 91-38, PTCE 95-60
or PTCE
96-23 or some other applicable exemption. Notwithstanding anything else
to the
contrary herein, any purported transfer of an ERISA-Restricted Trust Certificate
prior to the termination of the Cap Agreement and the Swap Agreement on
behalf
of such Plan without the delivery to the Securities Administrator of a
representation letter as described above shall be void and of no effect.
If the
ERISA-Restricted Trust Certificate is a Book-Entry Certificate, the transferee
will be deemed to have made a representation as provided in clause (i)
or (ii)
of this paragraph, as applicable.
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If
any
ERISA-Restricted Trust Certificate, or any interest therein, is acquired
or held
in violation of the provisions of the preceding paragraph, the next preceding
permitted beneficial owner will be treated as the beneficial owner of that
Certificate, retroactive to the date of transfer to the purported beneficial
owner. Any purported beneficial owner whose acquisition or holding of an
ERISA-Restricted Trust Certificate, or interest therein, was effected in
violation of the provisions of the preceding paragraph shall indemnify
to the
extent permitted by law and hold harmless the Depositor, the Securities
Administrator, the Trustee, the Servicer and the Master Servicer from and
against any and all liabilities, claims, costs or expenses incurred by
such
parties as a result of such acquisition or holding.
To
the
extent permitted under applicable law (including, but not limited to, ERISA),
the Securities Administrator shall be under no liability to any Person
for any
registration of transfer of any ERISA-Restricted Certificate or ERISA-Restricted
Trust Certificate that is in fact not permitted by this Section 5.02(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 so long as, in the case of a Physical Certificate, the transfer
was
registered by the Securities Administrator in accordance with the foregoing
requirements.
(c) 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:
(i) 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;
(ii) No
Ownership Interest in a Residual Certificate may be registered on the Closing
Date or thereafter transferred, and the Securities Administrator shall
not
register the Transfer of any Residual Certificate unless, in addition to
the
certificates required to be delivered to the Securities Administrator under
subparagraph (b) above, the Securities Administrator shall have been
furnished with an affidavit (a “Transfer
Affidavit”)
of the
initial owner or the proposed transferee in the form attached hereto as
Exhibit G;
(iii) Each
Person holding or acquiring any Ownership Interest in a Residual Certificate
shall agree (A) to obtain a Transfer Affidavit from any other Person to
whom such Person attempts to Transfer its Ownership Interest in a Residual
Certificate, (B) to obtain a Transfer Affidavit from any Person for whom
such Person is acting as nominee, trustee or agent in connection with any
Transfer of a Residual Certificate and (C) not to Transfer its Ownership
Interest in a Residual Certificate or to cause the Transfer of an Ownership
Interest in a Residual Certificate to any other Person if it has actual
knowledge that such Person is a Non-Permitted Transferee;
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(iv) Any
attempted or purported Transfer of any Ownership Interest in a Residual
Certificate in violation of the provisions of this Section 5.02(c) shall be
absolutely null and void and shall vest no rights in the purported Transferee.
If any purported transferee shall become a Holder of a Residual Certificate
in
violation of the provisions of this Section 5.02(c), then the last
preceding Permitted Transferee shall be restored to all rights as Holder
thereof
retroactive to the date of registration of 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 Section 5.02(a) and this Section 5.02(c) 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
so long as the Transfer was registered after receipt of the related Transfer
Affidavit, Transferor Certificate and the Rule 144A Investment Letter. The
Securities Administrator shall be entitled but not obligated to recover
from any
Holder of a Residual Certificate that was in fact a Non-Permitted Transferee
at
the time it became a Holder or, at such subsequent time as it became a
Non-Permitted Transferee, all payments made on such Residual 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 Permitted Transferee of such Certificate; and
(v) The
Depositor shall use its best efforts to make available, upon receipt of
written
request from the Securities Administrator, all information necessary to
compute
any tax imposed under Section 860E(e) of the Code as a result of a Transfer
of an Ownership Interest in a Residual Certificate to any Holder who is
a
Non-Permitted Transferee.
The
restrictions on Transfers of a Residual Certificate set forth in this
Section 5.02(c) shall cease to apply (and the applicable portions of the
legend on a Residual Certificate may be deleted) with respect to Transfers
occurring after delivery to the Securities Administrator of an Opinion
of
Counsel, which Opinion of Counsel shall not be an expense of the Trust
Fund, the
Trustee, the Securities Administrator or the Servicer, to the effect that
the
elimination of such restrictions will not cause any REMIC created hereunder
to
fail to qualify as a REMIC at any time that the Certificates are outstanding
or
result in the imposition of any tax on the Trust Fund, a Certificateholder
or
another Person. Each Person holding or acquiring any Ownership Interest
in a
Residual Certificate hereby consents to any amendment of this Agreement
which,
based on an Opinion of Counsel furnished to the Securities Administrator,
is
reasonably necessary (a) to ensure that the record ownership of, or any
beneficial interest in, a Residual Certificate is not transferred, directly
or
indirectly, to a Person that is a Non-Permitted Transferee and (b) to
provide for a means to compel the Transfer of a Residual Certificate which
is
held by a Person that is a Non-Permitted Transferee to a Holder that is
a
Permitted Transferee.
-106-
(d) The
preparation and delivery of all certificates and opinions referred to above
in
this Section 5.02 in connection with transfer shall be at the expense of
the parties to such transfers.
(e) Except
as
provided below, the Book-Entry Certificates shall at all times remain registered
in the name of the Depository or its nominee and at all times:
(i) registration of the Certificates may not be transferred by the
Securities Administrator except to another Depository; (ii) the Depository
shall maintain book-entry records with respect to the Certificate Owners
and
with respect to ownership and transfers of such Book-Entry Certificates;
(iii) ownership and transfers of registration of the Book-Entry
Certificates on the books of the Depository shall be governed by applicable
rules established by the Depository; (iv) the Depository may collect its
usual and customary fees, charges and expenses from its Depository Participants;
(v) the Securities Administrator shall deal with the Depository, Depository
Participants and indirect participating firms as representatives of the
Certificate Owners of the Book-Entry Certificates for purposes of exercising
the
rights of holders under this Agreement, and requests and directions for
and
votes of such representatives shall not be deemed to be inconsistent if
they are
made with respect to different Certificate Owners; and (vi) 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
furnished by the Depository Participants with respect to indirect participating
firms and persons shown on the books of such indirect participating firms
as
direct or indirect Certificate Owners.
All
transfers by Certificate Owners of Book-Entry Certificates shall be made
in
accordance with the procedures established by the Depository Participant
or
brokerage firm representing such Certificate Owner. Each Depository Participant
shall only transfer Book-Entry Certificates of Certificate Owners it represents
or of brokerage firms for which it acts as agent in accordance with the
Depository’s normal procedures.
If
(x) (i) the Depository or the Depositor advises the Securities
Administrator in writing that the Depository is no longer willing or able
to
properly discharge its responsibilities as Depository, and (ii) the
Securities Administrator or the Depositor is unable to locate a qualified
successor, or (y) the Depositor notifies the Depository (and the Securities
Administrator consents) of its intent to terminate the book-entry system
through
the Depository and, upon receipt of notice of such intent from the Depository,
the Depository Participants holding beneficial interests in the Book-Entry
Certificates agree to initiate such termination, the Securities Administrator
shall notify all Certificate Owners, through the Depository, of the occurrence
of any such event and of the availability of definitive, fully registered
Certificates (the “Definitive
Certificates”)
to
Certificate Owners requesting the same. Upon surrender to the Securities
Administrator of the related Class of Certificates by the Depository,
accompanied by the instructions from the Depository for registration, the
Securities Administrator shall issue the Definitive Certificates. None
of the
Servicer, the Depositor or the Securities Administrator shall be liable
for any
delay in delivery of such instruction and each may conclusively rely on,
and
shall be protected in relying on, such instructions. The Depositor shall
provide
the Securities Administrator with an adequate inventory of Certificates
to
facilitate the issuance and transfer of Definitive Certificates. Upon the
issuance of 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 the Definitive Certificates as Certificateholders hereunder;
provided,
that
the Securities Administrator shall not by virtue of its assumption of such
obligations become liable to any party for any act or failure to act of
the
Depository.
-107-
(f) Each
Private Certificate presented or surrendered for registration of transfer
or
exchange shall be accompanied by a written instrument of transfer and
accompanied by IRS Form W-8ECI, W-8BEN, W-8IMY (and all appropriate attachments)
or W-9 in form satisfactory to the Securities Administrator, duly executed
by
the Certificateholder or his attorney duly authorized in writing. Each
Certificate presented or surrendered for registration of transfer or exchange
shall be canceled and subsequently disposed of by the Securities Administrator
in accordance with its customary practice. No service charge shall be made
for
any registration of transfer or exchange of Private 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 Private Certificates.
Section
5.03 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 (b) there is delivered to the Depositor, the
Securities Administrator and the Trustee such security or indemnity as
may be
required by them to hold 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 5.03, 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 5.03 shall constitute complete and
indefeasible evidence of ownership, as if originally issued, whether or
not the
lost, stolen or destroyed Certificate shall be found at any time.
Section
5.04 Persons
Deemed Owners. The Trustee, the Depositor, the Securities Administrator and
any agent of the Trustee, the Depositor or the Securities Administrator
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 neither the Trustee,
the
Depositor, the Securities Administrator nor any agent of the Trustee, the
Depositor or the Securities Administrator shall be affected by any notice
to the
contrary.
Section
5.05 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 which such Certificateholders propose to transmit, or if
the
Depositor or the Servicer 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,
the
Servicer or such Certificateholders at such recipients’ expense the most recent
list of the Certificateholders of such 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.
-108-
Section
5.06 Maintenance
of Office or Agency. The Securities Administrator will maintain or cause to
be maintained at its expense an office or offices or agency or agencies
where
Certificates may be surrendered for registration of transfer or exchange.
The
Securities Administrator initially designates its offices located at ▇▇▇▇▇
▇▇▇▇▇▇ ▇▇▇ ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇ for such purposes.
The
Securities Administrator shall give prompt written notice to the
Certificateholders of any change in such location of any such office or
agency.
ARTICLE
VI
THE
DEPOSITOR AND THE SERVICER
Section
6.01 Respective
Liabilities of the Depositor and the Servicer. The Depositor and the
Servicer shall each be liable in accordance herewith only to the extent
of the
obligations specifically and respectively imposed upon and undertaken by
them
herein.
Section
6.02 Merger
or Consolidation of the Depositor or the Servicer. (a) The Depositor
and the Servicer will each keep in full effect its existence, rights and
franchises as a corporation, under the laws of the United States or under
the
laws of one of the states thereof and will each 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 respective duties under this Agreement.
(b) The
Servicer is and shall continue to be an institution which is a ▇▇▇▇▇▇
▇▇▇-approved and ▇▇▇▇▇▇▇ Mac-approved seller/servicer, shall maintain a
net
worth of at least $30,000,000 (as determined in accordance with generally
accepted accounting principles) and shall maintain its license to do business
or
service residential mortgage loans in any jurisdictions in which the Mortgaged
Properties are located.
(c) Any
Person into which the Depositor or the Servicer may be merged or consolidated,
or any Person resulting from any merger or consolidation to which the Depositor
or the Servicer shall be a party, or any person succeeding to the business
of
the Depositor or the Servicer, shall be the successor of the Depositor
or the
Servicer, as the case may be, 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 to the Servicer shall make the covenant
set
forth in Section 6.02(a) and (b).
Section
6.03 Limitation
on Liability of the Depositor, the Servicer and Others.
Neither
the Depositor, the Servicer, nor any of their respective directors, officers,
employees or agents, shall be under any liability to the Certificateholders
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; provided,
however,
that
this provision shall not protect the Depositor, the Servicer or any such
Person
against any breach of representations or warranties made by it herein or
protect
the Depositor, the Servicer or any such Person from any liability which
would
otherwise be imposed by reasons of willful misfeasance, bad faith or negligence
(or gross negligence in the case of the Depositor) in the performance of
duties
or by reason of reckless disregard of obligations and duties hereunder.
The
Depositor, its Affiliates, the Servicer and any of their respective directors,
officers, employees or agents 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. The Depositor, its Affiliates, the Servicer and any
of their
respective directors, officers, employees or agents shall be indemnified
by the
Trust Fund and held harmless against any loss, liability or expense incurred
in
connection with any audit, controversy or judicial proceeding relating
to a
governmental taxing authority or any legal action relating to this Agreement
or
the Certificates other than any loss, liability or expense related to any
specific Mortgage Loan or Mortgage Loans (except as any such loss, liability
or
expense shall be otherwise reimbursable pursuant to this Agreement and
any loss,
liability or expense incurred by reason of willful misfeasance, bad faith
or
negligence (or gross negligence in the case of the Depositor) in the performance
of duties hereunder or by reason of reckless disregard of obligations and
duties
hereunder. Neither the Depositor nor the Servicer shall be under any obligation
to appear in, prosecute or defend any legal action that is not incidental
to its
respective duties hereunder and which in its opinion may involve it in
any
expense or liability; provided,
however,
that
the Depositor may in its discretion undertake any such action (or direct
the
Trustee to undertake such actions pursuant to Section 2.03 for the benefit
of the Certificateholders) that it may deem necessary or desirable in respect
of
this Agreement and the rights and duties of the parties hereto and interests
of
the Trustee and the Certificateholders hereunder. In such event, the legal
expenses and costs of such action and any liability resulting therefrom
shall be
expenses, costs and liabilities of the Trust Fund, and the Depositor and
the
Servicer shall be entitled to be reimbursed therefor out of the Collection
Account.
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Section
6.04 Limitation
on Resignation of the Servicer.
Subject
to Section 7.01, the Servicer shall not assign this Agreement or resign
from the obligations and duties hereby imposed on it except by mutual consent
of
the Servicer, the Depositor, the Master Servicer and the Securities
Administrator with prior written notice to the Trustee or upon the determination
that its duties hereunder are no longer permissible under applicable law
and
such incapacity cannot be cured by the Servicer. Any such resignation shall
not
relieve the Servicer of responsibility for any of the obligations specified
in
Sections 7.01 and 7.02 as obligations that survive the resignation or
termination of the Servicer. Any such determination permitting the resignation
of the Servicer shall be evidenced by an Opinion of Counsel to such effect
delivered to the Depositor, the Securities Administrator, the Trustee and
the
Master Servicer which Opinion of Counsel shall be in form and substance
acceptable to the Depositor, the Securities Administrator and the Master
Servicer. No such resignation shall become effective until a successor
shall
have assumed the Servicer’s responsibilities and obligations hereunder.
Section
6.05 Additional
Indemnification by the Servicer; Third Party Claims.
Notwithstanding the limitations set forth in Section 6.03, the Servicer
shall
indemnify the Depositor, the Master Servicer, the Securities Administrator,
the
Trustee, the Trust Fund and any Affiliate, director, officer, employee
or agent
of the Depositor and hold each of them harmless against any and all claims,
losses, damages, penalties, fines, forfeitures, reasonable and necessary
legal
fees and related costs, judgments, and any other costs, fees and expenses
that
any of them may sustain in any way related to any breach by the Servicer,
of
(i) any of its representations and warranties referred to in
Section 2.03(a), (ii) any error in any tax or information return
prepared by the Servicer, (iii) the failure of the Servicer to perform its
duties and service the Mortgage Loans in compliance with the terms of this
Agreement or (iv) any failure by the Servicer, any Subservicer or any
Subcontractor to deliver any information, report, certification, accountants’
letter or other material when and as required under this Agreement, including
any report under Sections 3.22, 3.23, 3.24 and 3.29 or any failure by the
Servicer to identify pursuant to Section 3.02(c) any Subcontractor that
is a
Servicing Function Participant. The Servicer immediately shall notify the
Depositor, the Master Servicer, the Securities Administrator and the Trustee
if
a claim is made by a third party with respect to this Agreement or the
Mortgage
Loans, assume (solely with the prior written consent of the indemnified
party in
the event of an indemnified claim) 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 Depositor, the Master Servicer, the Securities Administrator or the
Trustee
in respect of such claim. In the case of any failure of performance described
in
clause (iv) of this Section 6.05, the Servicer shall promptly reimburse
the
Trustee, the Master Servicer, the Securities Administrator or the Depositor,
as
applicable, and each Person responsible for the preparation, execution
or filing
of any report required to be filed with the Commission with respect to
the
transaction relating to this Agreement, or for execution of a certification
pursuant to Rule 13a-14(d) or Rule 15d-14(d) under the Exchange Act with
respect
to this transaction, for all costs reasonably incurred by each such party
in
order to obtain the information, report, certification, accountants’ letter or
other material not delivered as required by the Servicer, any Subservicer
or any
Subcontractor. This indemnity shall survive the termination of this Agreement
and the earlier resignation or removal of the Servicer and the parties
indemnified by the Servicer under this paragraph.
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Section
6.06 Compliance
with Regulation AB; Cooperation of Parties. Notwithstanding any other
provision of this Agreement, the Servicer acknowledges and agrees that
the
purpose of Sections 3.02, 3.22, 3.23, 3.24, 3.29, 6.05, 7.01(i) and 8.12
and
Exhibit S of this Agreement is to facilitate compliance by the Securities
Administrator, the Master Servicer and the Depositor with the provisions
of
Regulation AB. Therefore, the Servicer agrees that (a) the obligations
of the
Servicer hereunder shall be interpreted in such a manner as to accomplish
that
purpose, (b) such obligations may change over time due to interpretive
advice or
guidance of the Commission, 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 Servicer shall agree to enter
into
such amendments to this Agreement as may be necessary, in the judgment
of the
Servicer, the Depositor, the Master Servicer and the Securities Administrator
and their respective counsel, to comply with such interpretive advice or
guidance, convention, consensus, advice of counsel, or otherwise, (d) the
Servicer shall otherwise comply with requests made by the Securities
Administrator, the Master Servicer or the Depositor, and mutually agreed
upon by
the Servicer, for delivery of additional or different information reasonably
available to the Servicer as such parties may determine in good faith is
necessary to comply with the provisions of Regulation AB and (e) the
Servicer
shall (i) agree to such modifications and enter into such amendments to
this
Agreement as may be necessary, in the judgment of the Depositor, the Master
Servicer and
the
Securities Administrator and
their
respective counsel
and
mutually agreed upon by the Servicer, to
comply
with any such clarification, interpretive guidance, convention or consensus
and
(ii) promptly
upon request provide to the Depositor or the Securities Administrator for
inclusion in any periodic report required to be filed under the Securities
Exchange Act, such items of information reasonably available to the Servicer
regarding this Agreement and matters related to the Servicer (collectively,
the
“Servicer Information”), provided
that
such
information shall be required to be provided by the Servicer only to the
extent
that such shall be determined by the Depositor or the Master Servicer in
its
sole discretion and its counsel to be necessary or advisable to comply
with any
Commission and industry guidance and convention.
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ARTICLE
VII
DEFAULT
Section
7.01 Events
of Default. “Event
of Default”,
wherever used herein, means any one of the following events:
(a) any
failure by the Servicer to remit to the Master Servicer any payment required
to
be made under the terms of this Agreement which continues unremedied for
a
period of two Business Days after the date upon which written notice of
such
failure, requiring the same to be remedied, shall have been given to the
Servicer by the Depositor or by the Master Servicer, or to the Servicer,
the
Depositor, the Master Servicer, the Securities Administrator and the Trustee
by
Certificateholders entitled to at least 25.00% of the Voting Rights in
the
Certificates; or
(b) subject
to clause (i) of this Section 7.01, the failure on the part of the Servicer
duly
to observe or perform in any material respect any other of the covenants
or
agreements on the part of the Servicer set forth in this Agreement which
continues unremedied for a period of sixty days (except that such
number of days shall be fifteen in the case of a failure to pay any premium
for
any insurance policy required to be maintained under this Agreement)
after the earlier of (i) the date on which written notice of such
failure, requiring the same to be remedied, shall have been given to the
Servicer by the Depositor or by the Master Servicer, or to the Servicer,
the
Depositor, the Master Servicer, the Securities Administrator and the Trustee
by
Certificateholders entitled to at least 25.00% of the Voting Rights in
the
Certificates and (ii) actual knowledge of such failure by a Servicing
Officer of the Servicer; or
(c) 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 Servicer and such decree or order shall have
remained in force undischarged or unstayed for a period of sixty
consecutive days; or
(d) the
Servicer shall 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 Servicer
or
of or relating to all or substantially all of its property; or
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(e) the
Servicer shall admit in writing its inability generally to pay its debts
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
(f) any
failure of the Servicer to make any P&I Advance on any Remittance Date
required to be made from its own funds pursuant to Section 4.01 which
continues unremedied for one Business Day immediately following the Remittance
Date; or
(g) a
breach
of any representation and warranty of the Servicer referred to in
Section 2.03(a) (including those representations and warranties set forth
in Exhibit Q and referenced therein), which materially and adversely affects
the
interests of the Certificateholders and which continues unremedied for
a period
of thirty days after the date upon which written notice of such breach is
given to the Servicer by the Master Servicer or by the Depositor, or to
the
Servicer, the Master Servicer, the Depositor, the Securities Administrator
and
the Trustee by Certificateholders entitled to at least 25.00% of the Voting
Rights in the Certificates; or
(h) Fitch
reduces its primary subprime servicer rating of the Servicer to “RPS3-“ or
lower, ▇▇▇▇▇’▇ reduces its primary subprime servicer rating of the Servicer to
“SQ3” or lower, or Standard & Poor’s reduces its primary subprime servicer
rating of the Servicer to “Average” or lower, and any such downgrade continues
unremedied for a period of ninety days; or
(i) any
failure by the Servicer to duly perform, within the required time period,
its
obligations under Sections 3.02, 3.22, 3.23, 3.24, 3.29 or 8.12 or any
other
information, data or materials required to be provided hereunder, including
any
items required to be included in any Exchange Act report; provided, that
in any
given year in which the Servicer has received written confirmation from
the
Depositor that a Form 10-K is not required to be filed with the Commission
in
respect of the Trust for the preceding calendar year, there shall be a
ten (10)
day cure period applicable to the reporting requirements under Section
3.22 and
3.23; or
If
an
Event of Default described in clauses (a) through (i) of this
Section 7.01 shall occur, then, and in each and every such case, so long as
such Event of Default shall not have been remedied, the Master Servicer
(or, if
the Master Servicer and the Servicer are the same entity, the Trustee)
may, or
at the direction of a majority of the Voting Rights shall, by notice in
writing
to the Servicer related to such Event of Default (with a copy to each Rating
Agency and the Derivative Counterparty), terminate all of the rights and
obligations of the Servicer under this Agreement and in and to the Mortgage
Loans and the proceeds thereof, other than its rights as a Certificateholder
hereunder; provided,
however,
that
the Master Servicer or the Trustee (as successor master servicer), as
applicable, shall not be required to give written notice to the Servicer
of the
occurrence of an Event of Default described in clauses (b) through
(j) of this Section 7.01 unless and until a Responsible Officer of the
Master Servicer or the Trustee (as successor master servicer), as applicable,
has actual knowledge of the occurrence of such an event; provided further,
that
the Depositor shall give written notice to the Servicer, Master Servicer
and the
Trustee of the occurrence of an Event of Default described in
clause (h) of this Section 7.01 upon obtaining actual knowledge
of the occurrence of such an event. In the event that a Responsible Officer
of
the Master Servicer or the Trustee (as successor master servicer), as
applicable, has actual knowledge of the occurrence of an event of default
described in clause (a) or (f) of this Section 7.01, the Master
Servicer or the Trustee (as successor master servicer), as applicable,
shall
give written notice to the Servicer of the occurrence of such an event
within
one Business Day of the first day on which such Responsible Officer obtains
actual knowledge of such occurrence. On and after receipt by the Servicer
of
such written notice, all authority and power of the Servicer hereunder,
whether
with respect to the Mortgage Loans or otherwise, shall pass to and be vested
in
the Master Servicer or the Trustee (as successor master servicer), as
applicable,. Subject to Section 7.02, the Master Servicer or the Trustee
(as successor master servicer), as applicable, is hereby authorized and
empowered to execute and deliver, on behalf of the Servicer, as attorney-in-fact
or otherwise, 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. Unless expressly provided in such written notice, no such termination
shall affect any obligation of the Servicer to pay amounts owed pursuant
to
Article VIII. The Servicer agrees to cooperate with the Master Servicer or
the Trustee, as applicable, in effecting the termination of the Servicer’s
responsibilities and rights hereunder, including, without limitation, the
transfer to the Master Servicer or the Trustee (as successor master servicer),
as applicable, of all cash amounts which shall at the time be credited
to the
Collection Account, or thereafter be received with respect to the Mortgage
Loans.
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Notwithstanding
any termination of the activities of the Servicer hereunder, the Servicer
shall
be entitled to receive from the Trust Fund, prior to transfer of its servicing
obligations hereunder, payment of all accrued and unpaid Servicing Fees
and
reimbursement for all outstanding P&I Advances and Servicing
Advances.
Section
7.02 Master
Servicer to Act; Appointment of Successor. On and after the time the
Servicer receives a notice of termination pursuant to Section 3.25 or
Section 7.01, the Master Servicer or the Trustee (as successor master
servicer) , as applicable, shall, subject to and to the extent provided
in
Section 3.05, and subject to the rights of the Master Servicer or the
Trustee (as successor master servicer) , as applicable, to appoint a successor
servicer pursuant to this Section 7.02, be the successor to the Servicer
in its
capacity as servicer under this Agreement and the transactions set forth
or
provided for herein and shall be subject to all the responsibilities, duties
and
liabilities relating thereto placed on the Servicer by the terms and provisions
hereof and applicable law, including the obligation to make P&I Advances and
Servicing Advances pursuant to Section 3.25 or Section 7.01. It is
understood and acknowledged by the parties hereto that there will be a
period of
transition before the transfer of servicing obligations is fully effective.
Notwithstanding the foregoing, the Master Servicer or the Trustee (as successor
master servicer), as applicable, will have a period (not to exceed 90 days)
to complete the transfer of all servicing data and correct or manipulate
such
servicing data as may be required by the Master Servicer or the Trustee
(as
successor master servicer), as applicable, to correct any errors or
insufficiencies in the servicing data or otherwise enable the Master Servicer
or
the Trustee (as successor master servicer), as applicable, to service the
Mortgage Loans in accordance with Accepted Servicing Practices. As compensation
therefor, the Master Servicer or the Trustee (as successor master servicer),
as
applicable, shall be entitled to all funds relating to the Mortgage Loans
that
the Servicer would have been entitled to charge to the Collection Account
if the
Servicer had continued to act hereunder including, if the Servicer was
receiving
the Servicing Fee, the Servicing Fee and the income on investments or gain
related to the Collection Account which the Servicer would be entitled
to
receive. Notwithstanding the foregoing, if the Master Servicer or the Trustee
(as successor master servicer) , as applicable, has become the successor
to the
Servicer in accordance with Section 7.01, the Master Servicer or the
Trustee (as successor master servicer) , as applicable, may, if it shall
be
unwilling to so act, or shall, if it is prohibited by applicable law from
making
P&I Advances and Servicing Advances pursuant to Section 4.01, if it is
otherwise unable to so act, or at the written request of Certificateholders
entitled to at least a majority of the Voting Rights, 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 Servicer hereunder in the assumption of all or any part of the
responsibilities, duties or liabilities of the Servicer hereunder. Any
successor
to the Servicer shall make the covenant set forth in Section 6.02(b). Any
successor to the Servicer shall be an institution which is willing to service
the Mortgage Loans and which executes and delivers to the Depositor, the
Master
Servicer and the Trustee (as successor master servicer) an agreement accepting
such delegation and assignment, containing an assumption by such Person
of the
rights, powers, duties, responsibilities, obligations and liabilities of
the
Servicer (other than liabilities of the Servicer under Section 6.03
incurred prior to termination of the Servicer under Section 7.01), with
like effect as if originally named as a party to this Agreement; provided,
that
each Rating Agency acknowledges 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. Pending appointment
of a
successor to the Servicer hereunder, the Master Servicer or the Trustee
(as
successor master servicer), as applicable, unless such party is prohibited by
law from so acting, shall, subject to Section 3.05, act in such capacity as
hereinabove provided. In connection with such appointment and assumption,
the
Master Servicer or the Trustee (as successor master servicer), as applicable,
may make such arrangements for the compensation of such successor out of
payments on Mortgage Loans as it and such successor shall agree; provided,
however,
that no
such compensation shall be in excess of the Servicing Fee Rate and amounts
paid
to the Servicer from investments. The Master Servicer or the Trustee (as
successor master servicer), as applicable, and such successor servicer
shall
take such action, consistent with this Agreement, as shall be necessary
to
effectuate any such succession. Neither the Master Servicer, the Trustee
(as
successor master servicer), nor any other successor to the 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 Servicer to deliver or provide,
or
any delay in delivering or providing, any cash, information, documents
or
records to it.
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Notwithstanding
the foregoing, the parties hereto agree that the Master Servicer or the
Trustee
(as successor master servicer), as applicable, in its capacity as successor
servicer, immediately shall assume all of the obligations of the Servicer
to
make Advances and the Master Servicer or the Trustee (as successor master
servicer), as applicable, will assume the other duties of the Servicer
as soon
as practicable, but in no event later than 90 days after the Master Servicer
or
the Trustee (as successor master servicer), as applicable, becomes successor
servicer pursuant to the preceding paragraph. If the Master Servicer or
the
Trustee (as successor master servicer) as applicable, acts as a successor
servicer, it will have no obligation to make an Advance if it determines
in its
reasonable judgment that such Advance is nonrecoverable. Notwithstanding
the
foregoing, the Master Servicer or the Trustee (as successor master servicer),
as
applicable, in its capacity as successor servicer, shall not be responsible
for
the lack of information and/or documents that it cannot obtain through
reasonable efforts; provided,
however,
that
any failure to perform any duties or responsibilities caused by the Servicer’s
failure to provide information required by this Agreement shall not be
considered a default by the Trustee (as successor master servicer) hereunder.
In
the Trustee’s capacity as such successor, the Trustee (as successor master
servicer) shall have the same limitations on liability herein granted to
the
Servicer.
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In
the
event that the Servicer is terminated pursuant to Section 7.01, the
terminated Servicer shall provide notices to the Mortgagors, transfer the
Servicing Files to a successor servicer and pay all of its own out-of-pocket
costs and expenses at its own expense. In addition, in the event that the
Servicer is terminated pursuant to Section 7.01, the terminated Servicer
shall pay all reasonable out-of-pocket costs and expenses of a servicing
transfer incurred by parties other than the terminated Servicer (including
without limitation, any costs or 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 or the Trustee
(as
successor master servicer), as applicable, to correct any errors or
insufficiencies in the servicing data or otherwise to enable the Master
Servicer
or the Trustee (as successor master servicer), as applicable, to service
the
Mortgage Loans properly and effectively), promptly upon presentation of
reasonable documentation of such costs. If the Master Servicer or the Trustee
(as successor master servicer), as applicable, is the terminated Servicer
(except in the case where the Master Servicer in its role as successor
servicer
is being terminated pursuant to Section 7.01 by reason of an Event of
Default caused solely by the Master Servicer as the successor servicer
and not
by the predecessor Servicer’s actions or omissions), such costs shall be paid by
the prior terminated Servicer promptly upon presentation of reasonable
documentation of such costs. If the terminated Servicer defaults in its
obligation to pay such costs and expenses, the same shall be paid by the
successor servicer, the Master Servicer or the Trustee (as successor master
servicer), in which case the successor servicer, the Master Servicer or
the
Trustee (as successor master servicer), as applicable, shall be entitled
to
reimbursement therefor from the Trust Fund.
Any
successor to the Servicer as servicer shall give notice to the Mortgagors
of
such change of servicer and shall, during the term of its service as servicer,
maintain in force the policy or policies that the Servicer is required
to
maintain pursuant to Section 3.13.
Section
7.03 Notification
to Certificateholders. (a) Upon any termination of or appointment
of a successor to the Servicer, the Securities Administrator shall give
prompt
written notice thereof to Certificateholders, each Rating Agency and the
Derivative Counterparty.
(b) Within
60 days after the occurrence of any Event of Default, the Securities
Administrator shall transmit by mail to all Certificateholders, each Rating
Agency and the Derivative Counterparty notice of each such Event of Default
hereunder known to the Securities Administrator, unless such event shall
have
been cured or waived.
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ARTICLE
VIII
CONCERNING
THE TRUSTEE
Section
8.01 Duties
of the Trustee. The Trustee, before the occurrence of a Master Servicer
Event of Default and after the curing of all Master Servicer Events of
Default
that may have occurred, shall undertake to perform such duties and only
such
duties as are specifically set forth in this Agreement. In case a Master
Servicer Event of Default has occurred and remains uncured, 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.
The
Trustee, upon receipt of all resolutions, certificates, statements, opinions,
reports, documents, orders or other instruments furnished to the Trustee
that
are specifically required to be furnished pursuant to any provision of
this
Agreement, shall examine them to determine whether they are in the form
required
by this Agreement. The Trustee shall not be responsible for the accuracy
or
content of any resolution, certificate, statement, opinion, report, document,
order, or other instrument.
No
provision of this Agreement shall be construed to relieve the Trustee from
liability for its own negligent action, its own negligent failure to act
or its
own willful misconduct.
Unless
an
Event of Default known to the Trustee has occurred and is
continuing:
(a) the
duties and obligations of the Trustee shall be determined solely by the
express
provisions of this Agreement, the Trustee shall not be liable except for
the
performance of the duties and obligations specifically set forth in this
Agreement, no implied covenants or obligations shall be read into this
Agreement
against the Trustee, and the Trustee may conclusively rely, as to the truth
of
the statements and the correctness of the opinions expressed therein, upon
any
certificates or opinions furnished to the Trustee and conforming to the
requirements of this Agreement which it believes in good faith to be genuine
and
to have been duly executed by the proper authorities respecting any matters
arising hereunder;
(b) the
Trustee shall not be liable for an error of judgment made in good faith
by a
Responsible Officer or Responsible Officers of the Trustee, unless it is
finally
proven that the Trustee was negligent in ascertaining the pertinent facts;
and
(c) the
Trustee shall not be liable with respect to any action taken, suffered,
or
omitted to be taken by it in good faith in accordance with the direction
of the
Holders of Certificates evidencing not less than 25.00% of the Voting Rights
of
Certificates relating to the time, method, and place of conducting any
proceeding for any remedy available to the Trustee, or exercising any trust
or
power conferred upon the Trustee under this Agreement.
Section
8.02 Certain
Matters Affecting the Trustee. Except as otherwise provided in
Section 8.01:
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(a) the
Trustee may rely upon and shall be protected in acting or refraining from
acting
upon any resolution, Officer’s Certificate, certificate 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 and
the
Trustee shall have no responsibility to ascertain or confirm the genuineness
of
any signature of any such party or parties;
(b) the
Trustee may consult with counsel, financial advisers or accountants and
the
advice of any such counsel, financial advisers or accountants and any Opinion
of
Counsel shall be full and complete authorization and protection in respect
of
any action taken or suffered or omitted by it hereunder in good faith and
in
accordance with such advice or Opinion of Counsel;
(c) the
Trustee shall not be liable 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;
(d) the
Trustee shall not 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 the Holders of Certificates evidencing
not less than 25.00% of the Voting Rights allocated to each Class of
Certificates;
(e) the
Trustee may execute any of the trusts or powers hereunder or perform any
duties
hereunder either directly or by or through agents, accountants, custodians,
nominees or attorneys and the Trustee shall not be responsible for any
misconduct or negligence on the part of any agents, accountants or attorneys
appointed with due care by it hereunder;
(f) the
Trustee shall not be required to risk or expend its own funds or otherwise
incur
any financial liability in the performance of any of its duties or in the
exercise of any of its rights or powers hereunder if it shall have reasonable
grounds for believing that repayment of such funds or indemnity satisfactory
to
it against such risk or liability is not assured to it;
(g) the
Trustee shall not be liable for any loss on any investment of funds pursuant
to
this Agreement;
(h) unless
a
Responsible Officer of the Trustee has actual knowledge of the occurrence
of a
Master Servicer Event of Default or an Event of Default, the Trustee shall
not
be deemed to have knowledge of a Master Servicer Event of Default or an
Event of
Default until a Responsible Officer of the Trustee shall have received
written
notice thereof;
(i) the
Trustee shall be under no obligation to exercise any of the trusts, rights
or
powers vested in it by 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 this Agreement, unless such
Certificateholders shall have offered to the Trustee reasonable security
or
indemnity satisfactory to the Trustee against the costs, expenses and
liabilities which may be incurred therein or thereby;
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(j) if
the
Trustee, in its role as successor master servicer under this Agreement,
assumes
the servicing or master servicing with respect to any of the Mortgage Loans,
it
shall not assume liability for the representations and warranties of the
Servicer or Master Servicer, as applicable, or for any errors or omissions
of
the Servicer or Master Servicer, as applicable; and
(k) in
order
to comply with laws, rules, regulations and executive orders in effect
from time
to time applicable to banking institutions, including those relating to
the
funding of terrorist activities and money laundering (“Applicable Law”), the
Trustee is required to obtain, verify and record certain information relating
to
individuals and entities which maintain a business relationship with the
Trustee. Accordingly, each of the parties agrees to provide to the Trustee
upon
its request from time to time such identifying information and documentation
as
may be available to such party in order to enable the Trustee to comply
with
Applicable Law.
Section
8.03 Trustee
Not Liable for Certificates or Mortgage Loans. The recitals contained herein
and in the Certificates shall be taken as the statements of the Depositor
and
the Trustee assumes no responsibility for their correctness. The Trustee
makes
no representations as to the validity or sufficiency of this Agreement,
the Cap
Agreement, the Swap Agreement, or of the Certificates or of any Mortgage
Loan or
related document. The Trustee shall not be accountable for the use or
application by the Depositor, the Master Servicer, the Servicer, the Securities
Administrator or the Derivative Counterparty of any funds paid to the Depositor,
the Master Servicer, the Servicer, the Securities Administrator or the
Derivative Counterparty in respect of the Mortgage Loans or deposited in
or
withdrawn from the Collection Account, the Distribution Account or any
other
fund or account with respect to the Certificates by the Depositor, the
Master
Servicer, the Servicer, the Securities Administrator or the Derivative
Counterparty.
The
Trustee shall have no responsibility for filing or recording any financing
or
continuation statement in any public office at any time or to otherwise
perfect
or maintain the perfection of any security interest or lien granted to
it
hereunder.
Section
8.04 Trustee
May Own Certificates. The Trustee in its individual or any other
capacity may become the owner or pledgee of Certificates with the same
rights as
it would have if it were not the Trustee.
Section
8.05 Trustee’s
Fees Indemnification and Expenses. (a) As compensation for its
activities under this Agreement, the Trustee shall be paid its fee by the
Master
Servicer from the Master Servicer’s own funds pursuant to a separate agreement.
The Trustee shall have no lien on the Trust Fund for the payment of such
fees.
(b) The
Trustee shall be entitled to be reimbursed, from funds on deposit in the
Distribution Account, amounts sufficient to indemnify and hold harmless
the
Trustee and any director, officer, employee, or agent of the Trustee against
any
loss, liability, or expense (including reasonable attorneys’ fees) incurred in
connection with any claim or legal action relating to:
(i) this
Agreement,
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(ii) the
Certificates, or
(iii) the
performance of any of the Trustee’s duties under this Agreement,
other
than any loss, liability, or expense (i) resulting from any breach of the
Servicer’s obligations in connection with this Agreement for which the Servicer
has performed its obligation to indemnify the Trustee pursuant to
Section 6.05, (ii) resulting from any breach of the Originator’s
obligations in connection with this Agreement for which the Originator
has
performed its obligation to indemnify the Trustee pursuant to
Section 2.03(h), (iii) resulting from any breach of the Master
Servicer’s obligation hereunder for which the Master Servicer has performed its
obligation to indemnify the Trustee pursuant to this Agreement or
(iv) incurred because of willful misconduct, bad faith, or negligence in
the performance of any of the Trustee’s duties under this Agreement. Without
limiting the foregoing, except as otherwise agreed upon in writing by the
Depositor and the Trustee, and except for any expense, disbursement, or
advance
arising from the Trustee’s negligence, bad faith, or willful misconduct, the
Trust Fund shall pay or reimburse the Trustee for all reasonable expenses,
disbursements, and advances incurred or made by the Trustee in accordance
with
this Agreement with respect to:
(A) the
reasonable compensation, expenses, and disbursements of its counsel not
associated with the closing of the issuance of the Certificates,
and
(B) the
reasonable compensation, expenses, and disbursements of any accountant,
engineer, or appraiser that is not regularly employed by the Trustee, to
the
extent that the Trustee must engage them to perform services under this
Agreement.
The
Trustee’s right to indemnity and reimbursement under this Section 8.05(b) shall
survive the termination of this Agreement and the resignation or removal
of the
Trustee under this Agreement.
Except
as
otherwise provided in this Agreement or a separate letter agreement between
the
Trustee and the Depositor, the Trustee shall not be entitled to payment
or
reimbursement for any routine ongoing expenses incurred by the Trustee
in the
ordinary course of its duties as Trustee under this Agreement or for any
other
routine expenses incurred by the Trustee; provided,
further,
that no
expense shall be reimbursed hereunder if it would not constitute an
“unanticipated expense incurred by the REMIC” within the meaning of the REMIC
Provisions.
The
Trustee shall not be (a) liable for any acts or omissions of the Servicer
(other
than where the Trustee (as successor master servicer) is such Servicer),
(b)
obligated to make any Advance if it is prohibited from doing so under applicable
law, (c) responsible for expenses of the Servicer (other than where the
Trustee
(as successor master servicer) is such Servicer) pursuant to the terms
of this
Agreement, (d) liable for any amount necessary to induce any successor
servicer
to act as successor servicer under this Agreement and enter into the
transactions set forth or provided for therein.
Section
8.06 Eligibility
Requirements for the Trustee. The Trustee hereunder shall at all times be a
corporation or association organized and doing business under the laws
of a
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, subject to supervision or examination by federal or state
authority
and with a credit rating which would not cause any of the Rating Agencies
to
reduce their respective then current ratings of the Certificates (or having
provided such security from time to time as is sufficient to avoid such
reduction) as evidenced in writing by each Rating Agency. If such corporation
or
association publishes reports of condition at least annually, pursuant
to law or
to the requirements of the aforesaid supervising or examining authority,
then
for the purposes of this Section 8.06 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 condition so published.
In
case at any time the Trustee shall cease to be eligible in accordance with
this
Section 8.06, the Trustee shall resign immediately in the manner and with
the effect specified in Section 8.07. The entity serving as Trustee may
have normal banking and trust relationships with the Depositor and its
affiliates, the Master Servicer, the Securities Administrator or the Servicer
and its affiliates; provided,
however,
that
such entity cannot be an affiliate of the Depositor or the Servicer other
than
the Trustee in its role as successor to the Master Servicer.
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Section
8.07 Resignation
and Removal of the Trustee. The Trustee may at any time resign and be
discharged from the trusts hereby created by giving written notice of
resignation to the Depositor, the Master Servicer, the Securities Administrator
and each Rating Agency not less than 60 days before the date specified in
such notice, when, subject to Section 8.08, such resignation is to take
effect and acceptance by a successor trustee in accordance with
Section 8.08 meeting the qualifications set forth in Section 8.06. If
no successor trustee meeting such qualifications shall have been so appointed
and have accepted appointment within 30 days after the giving of such
notice or resignation, the resigning Trustee may petition any court of
competent
jurisdiction for the appointment of a successor trustee.
If
at any
time the Trustee shall cease to be eligible in accordance with Section 8.06
and shall fail to resign after written request thereto by the Depositor,
or if
at any time the Trustee shall become incapable of acting, or shall be adjudged
as bankrupt or insolvent, or a receiver of the Trustee or of its property
shall
be appointed, or any public officer shall take charge or control of the
Trustee
or of its property or affairs for the purpose of rehabilitation, conservation
or
liquidation, or a tax is imposed with respect to the Trust Fund by any
state in
which the Trustee or the Trust Fund is located and the imposition of such
tax
would be avoided by the appointment of a different trustee, then the Depositor
or the Servicer may remove the Trustee and, subject to the approval of
the
Rating Agencies, appoint a successor trustee by written instrument, in
triplicate, one copy of which shall be delivered to the Trustee, one copy
to the
Servicer and one copy to the successor trustee.
The
Holders of Certificates entitled to at least a majority of the Voting Rights
may
at any time remove the Trustee and, subject to the confirmation of the
Rating
Agencies, appoint a successor trustee by written instrument or instruments,
in
triplicate, signed by such Holders or their attorneys-in-fact duly authorized,
one complete set of which shall be delivered by the successor Trustee to
the
Servicer, one complete set to the Trustee so removed and one complete set
to the
successor so appointed. The successor trustee shall notify each Rating
Agency of
any removal of the Trustee.
Any
resignation or removal of the Trustee and appointment of a successor trustee
pursuant to this Section 8.07 shall become effective upon acceptance of
appointment by the successor trustee as provided in
Section 8.08.
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Section
8.08 Successor
Trustee. Any successor trustee appointed as provided in Section 8.07
shall execute, acknowledge and deliver to the Depositor and to its predecessor
trustee and the Servicer an instrument accepting such appointment hereunder
and
thereupon the resignation or removal of the predecessor trustee shall become
effective and such successor trustee, without any further act, deed or
conveyance, shall become fully vested with all the rights, powers, duties
and
obligations of its predecessor hereunder, with like effect as if originally
named as trustee herein. The Depositor, the Servicer and the predecessor
trustee
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 all such rights, powers, duties, and
obligations.
No
successor trustee shall accept appointment as provided in this Section 8.08
unless at the time of its acceptance, the successor trustee is eligible
under
Section 8.06 and its appointment does not adversely affect then the current
rating of the Certificates.
Upon
acceptance of appointment by a successor trustee as provided in this
Section 8.08, the Depositor shall mail notice of the succession of such
trustee hereunder to all Holders of Certificates. If the Depositor fails
to mail
such notice within 10 days after acceptance of appointment by the successor
trustee, the successor trustee shall cause such notice to be mailed at
the
expense of the Depositor.
Section
8.09 Merger
or Consolidation of the Trustee. Any corporation into which the Trustee may
be merged or converted or with which it may be consolidated or any corporation
resulting from any merger, conversion or consolidation to which the Trustee
shall be a party, or any corporation succeeding to the business of the
Trustee,
shall be the successor of the Trustee hereunder; provided,
that
such corporation shall be eligible under Section 8.06 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
8.10 Appointment
of Co-Trustee or Separate Trustee. Notwithstanding any other provisions of
this Agreement, at any time, for the purpose of meeting any legal requirements
of any jurisdiction in which any part of the Trust Fund or property securing
any
Mortgage Note 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
the
Trust Fund, and to vest in such Person or Persons, in such capacity and
for the
benefit of the Certificateholders, such title to the Trust Fund or any
part
thereof, whichever is applicable, and, subject to the other provisions
of this
Section 8.10, such powers, duties, obligations, rights and trusts as the
Servicer and the Trustee may consider appropriate. No co-trustee or separate
trustee hereunder shall be required to meet the terms of eligibility as
a
successor trustee under Section 8.06 and no notice to Certificateholders of
the appointment of any co-trustee or separate trustee shall be required
under
Section 8.08.
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Every
separate trustee and co-trustee shall, to the extent permitted by law,
be
appointed and act subject to the following provisions and
conditions:
(a) To
the
extent necessary to effectuate the purposes of this Section 8.10, all
rights, powers, duties and obligations conferred or imposed upon the Trustee,
except for the obligation of the Trustee (as successor master servicer)
under
this Agreement to advance funds on behalf of the Master Servicer, shall
be
conferred or imposed upon and exercised or performed by the Trustee and
such
separate trustee or co-trustee jointly (it being understood that such separate
trustee or co-trustee is not authorized to act separately without the Trustee
joining in such act), except to the extent that under any law of any
jurisdiction in which any particular act or acts are to be performed (whether
as
Trustee hereunder or as successor to the 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
the applicable Trust Fund or any portion thereof in any such jurisdiction)
shall
be exercised and performed singly by such separate trustee or co-trustee,
but
solely at the direction of the Trustee;
(b) No
trustee hereunder shall be held personally liable because of any act or
omission
of any other trustee hereunder and such appointment shall not, and shall
not be
deemed to, constitute any such separate trustee or co-trustee as agent
of the
Trustee;
(c) The
Trustee may at any time accept the resignation of or remove any separate
trustee
or co-trustee; and
(d) The
Trust
Fund, and not the Trustee, shall be liable for the payment of reasonable
compensation, reimbursement and indemnification to any such separate trustee
or
co-trustee.
Any
notice, request or other writing given to the Trustee shall be deemed to
have
been given to each of the separate trustees and co-trustees, when and 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 VIII. Each separate trustee and co-trustee, upon its
acceptance of the trusts 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 and
indemnity to, the Trustee. Every such instrument shall be filed with the
Trustee
and a copy thereof given to the Master Servicer and the Depositor.
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.
Section
8.11 Tax
Matters. It is intended that the assets with respect to which any REMIC
election pertaining to the Trust Fund is to be made, as set forth in the
Preliminary Statement, shall constitute, and that the conduct of matters
relating to such assets shall be such as to qualify such assets 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 each REMIC
created hereunder and that in such capacity it shall:
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(a) prepare
and file in a timely manner, a U.S. Real Estate Mortgage Investment Conduit
(REMIC) Income Tax Return (Form 1066 or any successor form adopted by the
Internal Revenue Service), which return the Trustee shall sign upon receipt
from
the Securities Administrator, and the Securities Administrator shall
prepare and
file 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 REMIC hereunder 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 to Certificateholders the schedules, statements
or
information at such times and in such manner as may be required
thereby;
(b) within
thirty days of the Closing Date, apply for an employer identification
number from the Internal Revenue Service via Form SS-4 or any other
acceptable method for all tax entities and shall also furnish to the
Internal
Revenue Service, on Form 8811 or as otherwise may be required by the Code,
the name, title, address, and telephone number of the person that the
holders of
the Certificates may contact for tax information relating thereto, 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;
(c) make
an
election that each REMIC created hereunder be treated as a REMIC on the
federal
tax return for its first taxable year (and, if necessary, under applicable
state
law);
(d) prepare
and forward 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 the calculation of any original issue discount using the prepayment
assumption (as described in the Prospectus Supplement);
(e) provide
information necessary for the computation of tax imposed on the transfer
of a
Residual Certificate to a Person that is a Non-Permitted Transferee, or
an agent
(including a broker, nominee or other middleman) of a Non-Permitted Transferee,
or a pass-through entity in which a Non-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) to
the
extent that they are under its control, conduct matters relating to such
assets
at all times that any Certificates are outstanding so as to maintain the
status
of each REMIC created hereunder as a REMIC under the REMIC
Provisions;
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(g) not
knowingly or intentionally take any action or omit to take any action that
would
cause the termination of the REMIC status of any of the REMICs created
hereunder;
(h) pay,
from
the sources specified in the last paragraph of this Section 8.11, the
amount of any federal or state tax, including prohibited transaction taxes
as
described below, imposed on each REMIC created hereunder before its termination
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) cause
federal, state or local income tax or information returns to be signed
by the
Securities Administrator or, if required by applicable tax law, the Trustee
or
such other person as may be required to sign such returns by the Code or
state
or local laws, regulations or rules; and
(j) maintain
records relating to each REMIC created hereunder, including the income,
expenses, assets, and liabilities thereof on a calendar year basis and
on the
accrual method of accounting and the adjusted basis of the assets 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
Holder of the largest Percentage Interest of the Class R Certificates shall
act as Tax Matters Person for each REMIC created hereunder, within the
meaning
of Treasury Regulations Section 1.860F-4(d), and the Securities
Administrator is hereby designated as agent of such Certificateholder for
such
purpose (or if the Securities Administrator is not so permitted, such Holder
shall be the Tax Matters Person in accordance with the REMIC Provisions).
In
such capacity, the Securities Administrator shall, as and when necessary
and
appropriate, represent each REMIC created hereunder 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
each REMIC created hereunder, enter into settlement agreements with any
governmental taxing agency, extend any statute of limitations relating
to any
tax item of each REMIC created hereunder, and otherwise act on behalf of
each
REMIC in relation to any tax matter or controversy involving it.
(l) The
Securities Administrator shall treat the beneficial owners of the Certificates
(other than the Class P, Class X and Class R Certificates) as having entered
into a notional principal contract with the beneficial owners of the Class
X
Certificates. Pursuant to each such notional principal contract, all beneficial
owners of the LIBOR Certificates shall be treated as having agreed to pay,
on
each Distribution Date, to the beneficial owners 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 interest in the Upper Tier REMIC corresponding
to such
Class of Certificates over (ii) the amount payable on such Class of Certificates
on such Distribution Date (such excess, a “Class I Shortfall”). A Class I
Shortfall payable from interest collections shall be allocated to each
Class of
Certificates (other than the Class P, Class X and Class R Certificates)
to the
extent that interest accrued on such Class for the related Interest Accrual
Period at the Interest Rate for a Class, computed by substituting “REMIC 2 Net
Funds Cap” for “Group I Available Funds Cap,” “Group II Available Funds Cap” or
“Class M Available Funds Cap,” as applicable, exceeds the amount of interest
accrued for the related Interest Accrual Period based on the applicable
Available Funds Cap, and a Class I Shortfall payable from principal collections
shall be allocated to the most subordinate Class of Certificates with an
outstanding principal balance to the extent of such balance. In addition,
pursuant to such notional principal contract, the beneficial owner of the
Class
X Certificates shall be treated as having agreed to pay Basis Risk Carryover
Amounts to the Owners of the LIBOR Certificates in accordance with the
terms of
this Agreement. Any payments to the Certificates in light of the foregoing
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
of a Class I Shortfall shall be treated for tax purposes as having been
received
by the beneficial owners of such Certificates in respect of their Interests
in
the Upper Tier REMIC and as having been paid by such beneficial owners
to the
Supplemental Interest Trust pursuant to the notional principal
contract. Thus,
each Certificate (other than a Class P and Class R Certificate) shall be
treated
as representing not only ownership of regular interests in the Upper Tier
REMIC,
but also ownership of an interest in (and obligations with respect to)
a
notional principal contract. For tax purposes, the notional principal contract
shall be deemed to have a value in favor of the Certificates entitled to
receive
Basis Risk Carryover Amounts of $10,000 as of the Closing Date.
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Notwithstanding
the priority and sources of payments set forth in Article IV hereof or
otherwise, the Securities Administrator shall account for all distributions
on
the Certificates as set forth in this Section 8.11. In no event shall
any
payments of Basis Risk Carryover Amounts provided for in this Section
8.11 be
treated as payments
with respect to a “regular interest” in a REMIC within the meaning of Code
Section 860G(a)(1). The
Securities Administrator shall file or cause to be filed with the IRS
together
with Form 1041 or such other form as may be applicable and shall furnish
or
cause to be furnished, to the Class X Certificateholders and the LIBOR
Certificateholders, the respective amounts described above that are received,
in
the time or times and in the manner required by the Code.
(m) To
enable
the Securities Administrator to perform its duties under this Agreement,
the
Depositor shall provide to the Securities Administrator within ten 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 the price,
yield,
prepayment assumption, and projected cash flows of the Certificates and
the
Mortgage Loans. Moreover, the Depositor shall provide information to the
Securities Administrator concerning the value to each Class of Certificates
of the right to receive Basis Risk Carryover Amounts from the Excess Reserve
Fund Account. Unless otherwise advised by the Depositor, for federal income
tax
purposes, the Securities Administrator is hereby directed to assign a value
of
zero to the right of each Holder allocating the purchase price of an initial
Offered Certificateholder between such right and the related Upper Tier
Regular
Interest. Thereafter, the Depositor shall provide to the Securities
Administrator promptly upon written request therefor any additional information
or data that the Securities Administrator may, from time to time, reasonably
request to enable the Securities Administrator to perform its duties under
this
Agreement; provided,
however,
that
the Depositor shall not be required to provide any information regarding
the
Mortgage Loans that the Servicer is required to provide to the Securities
Administrator pursuant to this Agreement. 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, pursuant to this paragraph, accurate information
or
data to the Securities Administrator on a timely basis.
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(n) None
of
the Master Servicer, the Securities Administrator or the Trustee shall
(i)
permit the creation of any interests in any REMIC other than the regular
and
residual interests set forth in the Preliminary Statement, (ii) receive
any
amount representing a fee or other compensation for services (except as
otherwise permitted by this Agreement or the related Mortgage Loan documents)
or
(iii) otherwise knowingly or intentionally take any action, cause the Trust
Fund
to 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, could (i) endanger the status of any REMIC as a REMIC or (ii)
result in the imposition of a tax upon any REMIC or 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, or the tax on “net income from foreclosure
property”) unless the Securities Administrator receives an Opinion of Counsel
(at the expense of the party seeking to take such action or, if such party
fails
to pay such expense, and the Securities Administrator determines that taking
such action is in the best interest of the Trust Fund and the
Certificateholders, at the expense of the Trust Fund, but in no event at
the
expense of the Securities Administrator) to the effect that the contemplated
action will not, with respect to the Trust Fund or any REMIC created hereunder,
endanger such status or result in the imposition of such a tax).
(o) If
any
tax is imposed on “prohibited transactions” of a REMIC created hereunder as
defined in Section 860F(a)(2) of the Code, on the “net income from
foreclosure property” of any REMIC created hereunder as defined in
Section 860G(c) of the Code, on any contribution to any REMIC created
hereunder after the Startup Day pursuant to Section 860G(d) of the Code, or
any other tax is imposed, including any minimum tax imposed on either REMIC
pursuant to Sections 23153 and 24874 of the California Revenue and Taxation
Code, if not paid as otherwise provided for herein, the tax shall be paid
by
(i) the Master Servicer, the Trustee, or the Securities Administrator, as
applicable, if such tax arises out of or results from negligence of the
Master
Servicer, the Trustee or the Securities Administrator, as applicable, in
the
performance of any of its obligations under this Agreement, (ii) the Originator
if such tax arises out of or results from the Originator’s obligation to
repurchase a Mortgage Loan pursuant to Section 2.03, (iii) the Sponsor,
if such
tax arises out of or results from the Sponsor’s obligation to repurchase a
Mortgage Loan pursuant to Section 2.03(k), (iv) the Servicer, in the case
of any
such minimum tax, and otherwise if such tax arises out of or results from
a
breach by the Servicer of any of its obligations under this Agreement,
or
(v) in all other cases, or if the Master Servicer, the Trustee, the
Securities Administrator or the Servicer fails to honor its obligations
under
the preceding clauses (i) through (iv), any such tax will be paid with
amounts otherwise to be distributed to the Certificateholders, as provided
in
Section 4.02(a).
Section
8.12 Commission
Reporting. (a) The Securities Administrator shall, in accordance with
industry standards, prepare and file with the Commission, via ▇▇▇▇▇, the
following reports in respect of the Trust as and to the extent required
under
the Exchange Act:
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(i) (A)
Within 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 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. Any disclosure in addition to the Monthly Statement that is required
to
be included on Form 10-D (“Additional Form 10-D Disclosure”) shall be reported
by the parties set forth on Exhibit V 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 Additional
Form
10-D Disclosure, except to the extent of its obligations set forth in the
next
paragraph.
(B)
As
set forth on Exhibit V hereto, within 5 calendar days after the related
Distribution Date, (i) the parties specified in Exhibit V hereto, shall
be
required to provide to the Securities Administrator and to the Depositor,
to the
extent known, in ▇▇▇▇▇-compatible format, or in such other format as 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, 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 Securities Administrator has no
duty
under this Agreement to monitor or enforce the performance by the parties
listed
on Exhibit V of their duties under this paragraph or proactively solicit
or
procure from such parties any Additional Form 10-D Disclosure information.
The
Depositor shall 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.
(C)
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 process
for
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 paragraph (d) of
this
Section 8.12. Promptly (but no later than one Business Day) after filing
with
the Commission, the Securities Administrator will make available on its
internet
website (located at ▇▇▇.▇▇▇▇▇▇▇.▇▇▇)
a final
executed copy of each Form 10-D prepared and filed by the Securities
Administrator. Each party to this Agreement acknowledges that the performance
by
each of the Master Servicer and the Securities Administrator of its duties
under
this Section 8.12(a)(i) 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 under this Section 8.12(a)(i).
The
Depositor acknowledges that the performance by each of the Master Servicer
and
the Securities Administrator of its duties under this Section 8.12(i) related
to
the timely preparation, execution and filing of Form 10-D is also contingent
upon any Servicing Function Participant strictly observing deadlines no
later
than those set forth in this paragraph that are applicable to the parties
to
this Agreement in the delivery to the Securities Administrator of any necessary
Additional Form 10-D Disclosure pursuant to any applicable 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
receive, on a timely basis, any information from any other party hereto
or any
Servicing Function Participant needed to prepare, arrange for execution
or file
such Form 10-D, not resulting from its own negligence, bad faith or willful
misconduct.
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(D)
Form
10-D
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 instructs the
Securities Administrator to check “Yes” for each item, unless 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, that the answer to either item should be “no.” The
Depositor 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 Depositor was required to file such reports) and it has been subject
to such
filing requirement for the past 90 days.” The Securities Administrator shall be
entitled to rely on such representations in preparing, executing and/or
filing
any such Form 10-D.
(ii) (A)
On or
prior to the 90th
day
after the end of each fiscal year of the Trust or such earlier date as
may be
required by the Exchange Act (the “10-K
Filing Deadline”)
(it
being understood that the fiscal year for the Trust ends on December
31st
of each
year), for so long as the Depositor is required to file reports with respect
to
the Trust under the Exchange Act, commencing in March 2008, the Securities
Administrator shall prepare and file on behalf of the Trust 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 the Servicer, the Master
Servicer and the Securities Administrator and any Servicing Function Participant
engaged by any such party (together with the Custodian, each a “Reporting
Servicer”)
as
described under Section 3.24(b), (ii)(A) the annual reports on assessment
of
compliance with Servicing Criteria for each Reporting Servicer, as described
under Section 3.22, and (B) if each Reporting Servicer’s report on assessment of
compliance with Servicing Criteria described under Section 3.22 identifies
any
material instance of noncompliance, disclosure identifying such instance
of
noncompliance, or if each Reporting Servicer’s report on assessment of
compliance with Servicing Criteria described under Section 3.22 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, provided,
however,
that
the Securities Administrator, at its discretion, may omit from the Form
10-K any
assessment of compliance or attestation report described in clause (iii)
below
that is not required to be filed with such Form 10-K pursuant to Regulation
AB;
(iii)(A) the registered public accounting firm attestation report for each
Reporting Servicer, as described under Section 3.23, and (B) if any registered
public accounting firm attestation report described under Section 3.23
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 ▇▇▇▇▇▇▇▇-▇▇▇▇▇ Certification as described in Section
3.24.
Any disclosure or information in addition to (i) through (iv) above that
is
required to be included on Form 10-K (“Additional
Form 10-K Disclosure”)
shall
be reported by the parties set forth on Exhibit W 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 Additional
Form
10-K Disclosure, except to the extent of its obligations set forth in the
next
paragraph.
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(B)
As
set forth on Exhibit W hereto, no later than March 10 (with a 5 calendar
day
cure period, but in no event later than March 15) of each year that the
Trust is
subject to the Exchange Act reporting requirements, commencing in 2008,
(i) the
parties specified on Exhibit W shall be required to provide to the Securities
Administrator and to the Depositor, to the extent known, in ▇▇▇▇▇-compatible
format, or in such other format as 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
Securities Administrator has no duty under this Agreement to monitor or
enforce
the performance by the parties listed on Exhibit W of their duties under
this
paragraph or proactively solicit or procure from such parties any Additional
Form 10-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 Additional Form 10-K Disclosure
on Form 10-K pursuant to this Section 8.12 (a) (ii) (B).
(C)
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,
in any
year in which the Trust is subject to the reporting requirements of the
Exchange
Act, commencing in March 2008, 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 process
for
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
paragraph (d) of this Section 8.12. Promptly (but no later than one 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
prepared and filed by the Securities Administrator. The parties to this
Agreement acknowledge that the performance by the Securities Administrator
of
its duties under this Section 8.12(a)(ii) related to the timely preparation,
execution and filing of Form 10-K is contingent upon such parties strictly
observing all applicable deadlines in the performance of their duties under
this
Section 8.12(a)(ii) and Sections 3.22, 3.23 and 3.24. The Depositor acknowledges
that the performance by the Master Servicer and the Securities Administrator
of
its duties under this Section 8.12(ii) related to the timely preparation,
execution and filing of Form 10-K is also contingent upon any Servicing
Function
Participant strictly observing deadlines no later than those set forth
in this
paragraph that are applicable to the parties to this Agreement in the delivery
to the Securities Administrator of any necessary Additional Form 10-K
Disclosure, any annual statement of compliance and any assessment of compliance
and attestation pursuant to any applicable 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-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 or any Servicing
Function Participant needed to prepare, arrange for execution or file such
Form
10-K, not resulting from its own negligence, bad faith or willful
misconduct.
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(D) 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 requirement for the past 90 days.” The Depositor hereby instructs the
Securities Administrator to check “Yes” for each item, unless the Depositor
shall notify the Securities Administrator in writing, no later than the
15th
calendar
day of March in any year in which the Trust is subject to the reporting
requirements of the Exchange Act, commencing in March 2008, that the answer
to
either item should be “no.” The Depositor 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 Depositor was required to file such
reports) and it has been subject to such filing requirement for the past
90
days.” The Securities Administrator shall be entitled to rely on such
representations in preparing, executing and/or filing any such Form 10-K.
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(iii) (A)
Within four (4) Business Days after the occurrence of an event requiring
disclosure on Form 8-K (each such event, a “Reportable
Event”),
if
directed by the Depositor, 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 (“Form
8-K Disclosure Information”)
shall
be reported by the parties set forth on Exhibit X 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 to the extent of its obligations
set forth in the next paragraph.
(B)
As
set forth on Exhibit X 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 hereto shall be required to provide to the Securities
Administrator and the Depositor, to the extent known, in ▇▇▇▇▇-compatible
format, or in such other format as 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.
(C)
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 process for 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 paragraph (d) of this Section 8.12. Promptly (but
no
later than one Business Day) after filing with the Commission, the Securities
Administrator will make available on its internet website (located at
▇▇▇.▇▇▇▇▇▇▇.▇▇▇)
a final
executed copy of each Form 8-K prepared and filed by the Securities
Administrator. The parties to this Agreement acknowledge that the performance
by
the Securities Administrator of its duties under this Section 8.12(d)(iii)
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 Section 8.12(d)(iii). The Depositor
acknowledges that the performance by the Master Servicer and the Securities
Administrator of its duties under this Section 8.12(iii) related to the
timely
preparation, execution and filing of Form 8-K is also contingent upon any
Servicing Function Participant strictly observing deadlines no later than
those
set forth in this paragraph that are applicable to the parties to this
Agreement
in the delivery to the Securities Administrator of any necessary Form 8-K
Disclosure Information pursuant to the related any applicable agreement.
The
Securities Administrator shall have no liability for any loss, expense,
damage,
claim arising out of or with respect to any failure to properly prepare
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 or any Servicing Function
Participant needed to prepare, arrange for execution or file such Form
8-K, not
resulting from its own negligence, bad faith or willful misconduct.
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(b) The
Depositor acknowledges and agrees that the Securities Administrator may
include
in any Exchange Act report all relevant information, data, and exhibits
as the
Securities Administrator may receive in connection with such report irrespective
of any provision or Regulation AB that may permit the exclusion of such
material. By the way of example, the Securities Administrator may file
all
assessments of compliance, attestation reports and compliance statements
timely
received from any Item 1122 Servicing Function Participant irrespective
of any
applicable minimum pool asset percentage requirement for disclosure related
to
such Servicing Function Participant.
(c) The
Depositor agrees to furnish promptly to the Securities Administrator, from
time
to time upon request, such additional information, data, reports, documents,
and
financial statements within the Depositor’s possession or control as the
Securities Administrator reasonably requests as necessary or appropriate
to
prepare and file the foregoing reports. The Securities Administrator shall
make
available to the Depositor copies of all Exchange Act reports filed
hereunder.
(d)
(i) On
or
before 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 relating to the automatic suspension of reporting in
respect
of the Trust 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-DA and 10-KA 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, in
the case
of Form 10-D, for the purpose of restating any Monthly Statement), Additional
Form 10-K Disclosure or Form 8-K Disclosure Information, the Securities
Administrator will notify electronically the Depositor and such other parties
to
this Agreement as are affected by this Amendment and such parties will
cooperate
to prepare any necessary 8-KA, 10-DA or 10-KA. 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 each of the Master Servicer and the Securities Administrator
of
its duties under this Section 8.12(d) 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 or any Servicing Function Participant 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.
The Depositor shall be responsible for all costs and expenses of the Securities
Administrator related to the preparation and filing of any such amendment.
Notwithstanding the foregoing, if any Form 10-D needs to be amended solely
to
change the information contained in the Monthly Statement, the Securities
Administrator shall not be required to notify the Depositor of such
amendment.
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(e) Other
than the Exchange Act reports specified above, the Securities Administrator
shall have no responsibility to file any items or reports with the Commission
under the Exchange Act or otherwise; provided,
however,
the
Securities Administrator and Master Servicer will cooperate with the Depositor
in connection with any additional filings with respect to the Trust as
the
Depositor deems necessary under the Exchange Act.
(f) The
Depositor shall pay all costs and expenses of the Securities Administrator
related to the preparation and filing of any current report on Form 8-K,
any
periodic report on Form 10-D (other than the costs and expense of the Securities
Administrator associated with the preparation and filing of the Monthly
Statement), or any amendment to any Exchange Act report. Except as otherwise
provided herein, all expenses incurred by the Securities Administrator
in
connection with its preparation and filing of Exchange Act reports hereunder
shall not be reimbursable from the Trust.
(g) Any
notice required under this Section 8.12 may be given by facsimile or by
electronic mail.
Section
8.13 Tax
Classification of the Excess Reserve Fund Account and the Supplemental
Interest
Trust. For federal income tax purposes, the Securities Administrator shall
treat the Excess Reserve Fund Account and the Supplemental Interest Trust
as a
disregarded entity for so long as a single holder owns all of the Class
X
Certificates. For all federal tax purposes, amounts transferred by the
Upper
Tier REMIC to the Excess Reserve Fund Account shall be treated as distributions
by the Securities Administrator to the Class X Certificateholders.
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ARTICLE
IX
ADMINISTRATION
OF THE MORTGAGE LOANS
BY
THE MASTER SERVICER AND THE CREDIT RISK MANAGER
Section
9.01 Duties
of the Master Servicer; Enforcement of Servicer’s Obligations. (a) The
Master Servicer, on behalf of the Trustee, the Securities Administrator,
the
Depositor and the Certificateholders, shall monitor the performance of
the
obligations of the Servicer under this Agreement, and (except as set forth
below) shall use its reasonable good faith efforts to cause the Servicer
to duly
and punctually perform its duties and obligations hereunder. Upon the occurrence
of an Event of Default of which a Responsible Officer of the Master Servicer
or,
if the Master Servicer and the Servicer are the same entity, the Trustee,
has
actual knowledge, the Master Servicer or the Trustee, as applicable, shall
promptly notify the Securities Administrator and the Trustee, as applicable,
and
shall specify in such notice the action, if any, the Master Servicer or
the
Trustee, as applicable, plans to take in respect of such default. So long
as an
Event of Default shall occur and be continuing, the Master Servicer or
the
Trustee, as applicable, shall take the actions specified in Article VII.
Notwithstanding anything in this Agreement or the Credit Risk Management
Agreement entered into by the Servicer to the contrary, the Master Servicer
or
the Trustee, as applicable, shall have no duty or obligation to enforce
the
Credit Risk Management Agreement or to supervise, monitor or oversee the
activities of the Servicer under the Credit Risk Management Agreement with
respect to any action taken or not taken by the Servicer at the direction
of the
Sponsor or pursuant to a recommendation of the Credit Risk Manager.
If
(i) the Servicer reports a delinquency on a monthly report and
(ii) the Servicer, by 11 a.m. (New York Time) on the related
Remittance Date, neither makes an Advance nor provides the Securities
Administrator, the Master Servicer and the Trustee with an Officer’s Certificate
certifying that such an Advance would be a Nonrecoverable P&I Advance or
Nonrecoverable Servicing Advance, then the Master Servicer or, if the Master
Servicer and such Servicer are the same entity, the Trustee, shall deposit
in
the Distribution Account not later than the Business Day immediately preceding
the related Distribution Date an Advance in an amount equal to the difference
between (x) with respect to each Monthly Payment due on a Mortgage Loan
that is delinquent (other than Relief Act Interest Shortfalls) and for
which the
Servicer was required to make an Advance pursuant to this Agreement and
(y) amounts deposited in the Collection Account to be used for Advances
with respect to such Mortgage Loan, except to the extent the Master Servicer
or
the Trustee, as applicable, determines any such Advance to be a Nonrecoverable
P&I Advance or Nonrecoverable Servicing Advance. Subject to the foregoing
and Section 7.02, the Master Servicer or the Trustee, as applicable, shall
continue to make such Advances for so long as the Servicer is required
to do so
under this Agreement. If applicable, on the Business Day immediately preceding
the Distribution Date, the Master Servicer shall deliver an Officer’s
Certificate to the Trustee stating that the Master Servicer elects not
to make
an Advance in a stated amount and detailing the reason(s) it deems the
Advance
to be a Nonrecoverable P&I Advance or Nonrecoverable Servicing Advance. Any
amounts deposited by the Master Servicer or the Trustee, as applicable,
pursuant
to this Section 9.01 shall be net of the Servicing Fee for the related
Mortgage Loans.
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(b) The
Master Servicer or the Trustee (as successor master servicer), as applicable,
shall pay the costs of monitoring the Servicer as required hereunder
(including
costs associated with (i) termination of the Servicer, (ii) the
appointment of a successor servicer or (iii) the transfer to and assumption
of the servicing by the Master Servicer or the Trustee, as applicable)
and
shall, to the extent permitted hereunder, seek reimbursement therefor
initially
from the terminated Servicer. In the event the full costs associated
with the
transition of servicing responsibilities to the Master Servicer or the
Trustee
(as successor master servicer), as applicable, are not paid for by the
predecessor or successor servicer (provided such successor servicer is
not the
Master Servicer or the Trustee (as successor master servicer)), the Master
Servicer or the Trustee, as applicable, may be reimbursed therefor by
the Trust
for all costs incurred by the Master Servicer or the Trustee (as successor
master servicer), as applicable, associated with any such transfer of
servicing
duties from the Servicer to the Master Servicer or the Trustee, as applicable,
or any other successor servicer.
(c) If
the
Master Servicer or the Trustee (as successor master servicer), as applicable,
assumes the servicing with respect to any of the Mortgage Loans, it will
not
assume liability for the representations and warranties of the Servicer
it
replaces or for any errors or omissions of the Servicer.
(d) Neither
the Depositor nor the Securities Administrator shall consent to the assignment
by the Servicer of the Servicer’s rights and obligations under this Agreement
without the prior written consent of the Master Servicer and the Trustee,
which
consent shall not be unreasonably withheld.
Section
9.02 [Reserved].
Section
9.03 [Reserved].
Section
9.04 Maintenance
of Fidelity Bond and Errors and Omissions Insurance. The Master Servicer, at
its expense, shall maintain in effect a blanket fidelity bond and an errors
and
omissions insurance policy, affording coverage with respect to all directors,
officers, directors, 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. The errors and omissions insurance
policy and the fidelity bond shall be in such form and amount generally
acceptable for entities serving as master servicers or trustees.
Section
9.05 Representations
and Warranties of the Master Servicer. (a) The Master Servicer hereby
represents and warrants to the Depositor, the Securities Administrator
and the
Trustee, for the benefit of the Certificateholders, as of the Closing Date
that:
(i) it
is a
national banking association validly existing and in good standing under
the
laws of the United States of America, and as Master Servicer has full power
and
authority to transact any and all business contemplated by this Agreement
and to
execute, deliver and comply with its obligations under the terms of this
Agreement, the execution, delivery and performance of which have been duly
authorized by all necessary corporate action on the part of the Master
Servicer;
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(ii) the
execution and delivery of this Agreement by the Master Servicer and its
performance and compliance with the terms of this Agreement will not
(A) violate the Master Servicer’s charter or bylaws, (B) violate any
law or regulation or any administrative decree or order to which it is
subject
or (C) constitute a default (or an event which, with notice or lapse of
time, or both, would constitute a default) under, or result in the breach
of,
any material contract, agreement or other instrument to which the Master
Servicer is a party or by which it is bound or to which any of its assets
are
subject, which violation, default or breach would materially and adversely
affect the Master Servicer’s ability to perform its obligations under this
Agreement;
(iii) this
Agreement constitutes, assuming due authorization, execution and delivery
hereof
by the other respective parties hereto, a legal, valid and binding obligation
of
the Master Servicer, enforceable against it in accordance with the terms
hereof,
except as such enforcement may be limited by bankruptcy, insolvency,
reorganization, moratorium and other laws affecting the enforcement of
creditors’ rights in general, and by general equity principles (regardless of
whether such enforcement is considered in a proceeding in equity or at
law);
(iv) the
Master Servicer is not in default with respect to any order or decree of
any
court or any order or regulation of any federal, state, municipal or
governmental agency to the extent that any such default would materially
and
adversely affect its performance hereunder;
(v) the
Master Servicer is not a party to or bound by any agreement or instrument
or
subject to any charter provision, bylaw or any other corporate restriction
or
any judgment, order, writ, injunction, decree, law or regulation that may
materially and adversely affect its ability as Master Servicer to perform
its
obligations under this Agreement or that requires the consent of any third
person to the execution of this Agreement or the performance by the Master
Servicer of its obligations under this Agreement;
(vi) no
litigation is pending or, to the best of the Master Servicer’s knowledge,
threatened against the Master Servicer which would prohibit its entering
into
this Agreement or performing its obligations under this Agreement;
(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 of the transactions contemplated by this Agreement, except
for such
consents, approvals, authorizations and orders (if any) as have been obtained;
and
(viii) the
consummation of the transactions contemplated by this Agreement are in
the
ordinary course of business of the Master Servicer.
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(b) It
is
understood and agreed that the representations and warranties set forth
in this
Section shall survive the execution and delivery of this Agreement. The
Master
Servicer shall indemnify the Depositor, the Servicer, Securities Administrator,
the Trustee and the Trust and hold them harmless against any loss, damages,
penalties, fines, forfeitures, reasonable legal fees and related costs,
judgments, and other reasonable costs and expenses resulting from any claim,
demand, defense or assertion based on or grounded upon, or resulting from,
a
material breach of the Master Servicer’s representations and warranties
contained in Section 9.05(a) above. It is understood and agreed that the
enforcement of the obligation of the Master Servicer set forth in this
Section 9.05 to indemnify the Depositor, the Servicer, the Securities
Administrator, the Trustee and the Trust constitutes the sole remedy of
the
Depositor the Servicer, the Securities Administrator, the Trustee and the
Trust
respecting a breach of the foregoing representations and warranties. Such
indemnification shall survive any termination of the Master Servicer as
Master
Servicer hereunder, any termination of this Agreement and resignation or
removal
of the Trustee.
Any
cause
of action against the Master Servicer relating to or arising out of the
breach
of any representations and warranties made in this Section shall accrue
upon
discovery of such breach by either the Depositor, the Master Servicer,
Securities Administrator or the Trustee or notice thereof by any one of
such
parties to the other parties.
Section
9.06 Master
Servicer Events of Default. Each of the following shall constitute a
“Master
Servicer Event of Default”:
(a) any
failure by the Master Servicer to deposit in the Distribution Account any
payment received by it from the Servicer to make any P&I Advance or required
to be made by the Master Servicer 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 Master Servicer by any other party
hereto;
(b) failure
by the Master Servicer to duly observe or perform, in any material respect,
any
other covenants, obligations or agreements of the Master Servicer as set
forth
in this Agreement 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 Master Servicer by
the
Trustee or to the Master Servicer and Trustee by the holders of Certificates
evidencing at least 25.00% of the Voting Rights;
(c) 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 the Master Servicer and such decree or order
shall
have remained in force, undischarged or unstayed for a period of sixty
(60) days;
(d) the
Master 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 the Master
Servicer or relating to all or substantially all of its property;
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(e) the
Master Servicer shall admit in writing its inability to pay its debts 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 for three (3) Business
Days;
(f) Except
as
otherwise set forth herein, the Master Servicer attempts to assign this
Agreement or its responsibilities hereunder or to delegate its duties hereunder
(or any portion thereof) without the consent of the Securities Administrator
and
the Depositor;
(g) the
indictment of the Master Servicer for the taking of any action by the Master
Servicer, any Affiliate or any director or employee thereof that constitutes
fraud or criminal activity in the performance of its obligations under
this
Agreement, in each case, where such indictment materially and adversely
affects
the ability of the Master Servicer to perform its obligations under this
Agreement (subject to the condition that such indictment is not dismissed
within
ninety (90) days); or
(h) failure
of the Master Servicer to timely provide the Depositor with the assessment,
attestation and annual statement of compliance required by Item 1122 of
Regulation AB in accordance with Sections 3.22, 3.23 and 3.24.
In
each
and every such case, so long as a Master Servicer Event of Default shall
not
have been remedied, in addition to whatever rights the Trustee may have
at law
or equity or to damages, including injunctive relief and specific performance,
the Trustee, by notice in writing to the Master Servicer, may, and upon
the
request of the Holders of Certificates representing at least 51.00% of
the
Voting Rights shall, terminate with cause all the rights and obligations
of the
Master Servicer under this Agreement.
Upon
receipt by the Master Servicer of such written notice, all authority and
power
of the Master Servicer under this Agreement, shall pass to and be vested
in any
successor master servicer appointed hereunder which accepts such appointments.
Upon written request from the Trustee or the Depositor, the Master Servicer
shall prepare, execute and deliver to the successor entity designated by
the
Trustee any and all documents and other instruments related to the performance
of its duties hereunder as the Master Servicer and, place in such successor’s
possession all such documents with respect to the master servicing of the
Mortgage Loans and do or cause to be done all other acts or things necessary
or
appropriate to effect the purposes of such notice of termination, at the
Master
Servicer’s sole expense. The Master Servicer shall cooperate with the Trustee
and such successor master servicer in effecting the termination of the
Master
Servicer’s responsibilities and rights hereunder, including without limitation,
the transfer to such successor master servicer for administration by it
of all
cash amounts which shall at the time be credited to the Distribution Account
or
are thereafter received with respect to the Mortgage Loans.
Section
9.07 Waiver
of Default.
By a
written notice, the Trustee may at the direction of Holders of Certificates
evidencing at least 51.00% of the Voting Rights waive any default by the
Master
Servicer in the performance of its obligations hereunder and its consequences.
Upon any waiver of a past default, such default shall cease to exist, and
any
Master Servicer 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.
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Section
9.08 Successor
to the Master Servicer.
Upon
termination of the Master Servicer’s responsibilities and duties under this
Agreement, the Depositor shall use its reasonable good faith efforts to
appoint
a successor, which shall succeed to all rights and assume all of the
responsibilities, duties and liabilities of the Master Servicer under this
Agreement prior to the termination of the Master Servicer. Any successor
shall
be a ▇▇▇▇▇▇ ▇▇▇ and ▇▇▇▇▇▇▇ Mac approved servicer in good standing and
acceptable to the Depositor and the Rating Agencies. In connection with
such
appointment and assumption, the Depositor may make such arrangements for
the
compensation of such successor as it and such successor shall agree. In
the
event that the Master Servicer’s duties, responsibilities and liabilities under
this Agreement are terminated, the Master Servicer shall continue to discharge
its duties and responsibilities hereunder until the effective date of such
termination 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 of its successor. The termination of the
Master
Servicer shall not become effective until a successor shall be appointed
pursuant hereto and shall in no event (i) relieve the Master Servicer of
responsibility for the representations and warranties made pursuant to
Section 9.05(a) hereof and the remedies available to the Trustee under
Section 9.05(b) hereof, it being understood and agreed that the provisions
of Section 9.05 hereof shall be applicable to the Master Servicer
notwithstanding any such sale, assignment, resignation or termination of
the
Master Servicer or the termination of this Agreement; or (ii) affect the
right of the Master Servicer to receive payment and/or reimbursement of
any
amounts accruing to it hereunder prior to the date of termination (or during
any
transition period in which the Master Servicer continues to perform its
duties
hereunder prior to the date the successor master servicer fully assumes
its
duties).
If
no
successor master servicer has accepted its appointment within 90 days of
the time the Trustee receives the resignation of the Master Servicer, the
Trustee shall be the successor master servicer in all respects under this
Agreement and shall have all the rights and powers and be subject to all
the
responsibilities, duties and liabilities relating thereto, including the
obligation to make Advances; provided,
however,
that
any failure to perform any duties or responsibilities caused by the Master
Servicer’s failure to provide information required by this Agreement shall not
be considered a default by the Trustee hereunder. In the Trustee’s capacity as
such successor, the Trustee shall have the same limitations on liability
herein
granted to the Master Servicer. Notwithstanding anything herein to the
contrary,
the Trustee in its role as successor master servicer shall have no obligation
to
monitor or supervise the Servicer, shall only have the obligation to make
Advances if it terminates the Servicer pursuant to Section 7.01 (in its
role as
successor master servicer), and shall make such Advances only pursuant
to
Section 7.02. As compensation therefor, the Trustee shall be entitled to
receive
the compensation, reimbursement and indemnities otherwise payable to the
Master
Servicer, including the fees and other amounts payable pursuant to
Section 9.09 hereof.
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Any
successor master servicer appointed as provided herein, shall execute,
acknowledge and deliver to the Master Servicer, the Depositor and to the
Trustee
an instrument accepting such appointment, wherein the successor shall make
the
representations and warranties set forth in Section 9.05 hereof, and
whereupon such successor shall become fully vested with all of the rights,
powers, duties, responsibilities, obligations and liabilities of the Master
Servicer, with like effect as if originally named as a party to this Agreement.
Any termination or resignation of the Master Servicer or termination of
this
Agreement shall not affect any claims that the Trustee may have against
the
Master Servicer arising out of the Master Servicer’s actions or failure to act
prior to any such termination or resignation or in connection with the
Trustee’s
assumption of such obligations, duties and responsibilities.
Upon
a
successor’s acceptance of appointment as such, the Master Servicer shall notify
by mail the Trustee and the Depositor of such appointment.
Section
9.09 Compensation
of the Master Servicer.
[Reserved].
Section
9.10 Merger
or Consolidation.
Any
Person into which the Master Servicer may be merged or consolidated, or
any
Person resulting from any merger, conversion, other change in form or
consolidation to which the Master Servicer shall be a party, or any Person
succeeding to the business of the Master Servicer, shall be the successor
to the
Master Servicer 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 resulting Person to the Master Servicer shall (i) be a
Person (or have an Affiliate) that is qualified and approved to service
mortgage
loans for ▇▇▇▇▇▇ ▇▇▇ and ▇▇▇▇▇▇▇ Mac (provided further
that a
successor master servicer that satisfies subclause (i) through an
Affiliate agrees to service the Mortgage Loans in accordance with all applicable
▇▇▇▇▇▇ Mae and ▇▇▇▇▇▇▇ Mac guidelines) and (ii) have a net worth of not
less than $25,000,000.
Section
9.11 Resignation
of the Master Servicer.
Except
as otherwise provided in Sections 9.08 and 9.10 hereof, the Master Servicer
shall not resign from the obligations and duties hereby imposed on it unless
the
Master Servicer’s duties hereunder are no longer permissible under applicable
law or are in material conflict by reason of applicable law with any other
activities carried on by it and cannot be cured. Any such determination
permitting the resignation of the Master Servicer shall be evidenced by
an
Opinion of Counsel that shall be independent to such effect delivered to
the
Trustee. No such resignation shall become effective until the Trustee shall
have
assumed, or a successor master servicer satisfactory to the Trustee and
the
Depositor shall have assumed, the Master Servicer’s responsibilities and
obligations under this Agreement. Notice of such resignation shall be given
promptly by the Master Servicer and the Depositor to the Trustee.
If
at any
time, ▇▇▇▇▇ Fargo, as Master Servicer, resigns under this Section 9.11, or
is removed as Master Servicer pursuant to Section 9.06, then at such time
▇▇▇▇▇ Fargo shall also resign (and shall be entitled to resign) as Securities
Administrator under this Agreement.
Section
9.12 Assignment
or Delegation of Duties by the Master Servicer.
Except
as expressly provided herein, the Master 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
the
Master Servicer; provided,
however,
that
the Master Servicer shall have the right with the prior written consent
of the
Depositor (which shall not be unreasonably withheld or delayed), and upon
delivery to the Trustee and the Depositor of a letter from each Rating
Agency to
the effect that such action shall not result in a downgrade of the ratings
assigned to any of the Certificates, to delegate or assign to or subcontract
with or authorize or appoint any qualified Person to perform and carry
out any
duties, covenants or obligations to be performed and carried out by the
Master
Servicer hereunder. Notice of such permitted assignment shall be given
promptly
by the Master Servicer to the Depositor and the Trustee. If, pursuant to
any
provision hereof, the duties of the Master Servicer are transferred to
a
successor master servicer, the entire compensation payable to the Master
Servicer pursuant hereto shall thereafter be payable to such successor
master
servicer but in no event shall the fee payable to the successor master
servicer
exceed that payable to the predecessor master servicer.
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Section
9.13 Limitation
on Liability of the Master Servicer.
Neither
the Master Servicer nor any of the directors, officers, employees or agents
of
the Master Servicer shall be under any liability to the Trustee or the
Certificateholders 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;
provided,
however,
that
this provision shall not protect the Master Servicer or any such person
against
any liability that would otherwise be imposed by reason of willful malfeasance,
bad faith or negligence in the performance of its duties or by reason of
reckless disregard for its obligations and duties under this Agreement.
The
Master Servicer and any director, officer, employee or agent of the Master
Servicer may rely in good faith on any document prima facie properly executed
and submitted by any Person respecting any matters arising hereunder. The
Master
Servicer shall be under no obligation to appear in, prosecute or defend
any
legal action that is not incidental to its duties as Master Servicer with
respect to the Mortgage Loans under this Agreement and that in its opinion
may
involve it in any expenses or liability; provided,
however,
that
the Master Servicer may in its sole discretion undertake any such action
that it
may deem necessary or desirable in 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, shall be liabilities of the Trust, and the
Master
Servicer shall be entitled to be reimbursed therefor out of the Distribution
Account in accordance with the provisions of Section 9.09 and
Section 9.14.
The
Master Servicer shall not be liable under this Agreement for any acts or
omissions of the Servicer except to the extent that damages or expenses
are
incurred as a result of such acts or omissions and such damages and expenses
would not have been incurred but for the negligence, willful malfeasance,
bad
faith or recklessness of the Master Servicer in supervising, monitoring
and
overseeing the performance of the obligations of the Servicer as required
under
this Agreement.
Section
9.14 Indemnification;
Third Party Claims.
The
Master Servicer agrees to indemnify and hold harmless the Trustee as successor
master servicer from and against any and all claims, losses, penalties,
fines,
forfeitures, legal fees and related costs, judgments, and any other costs,
liabilities, fees and expenses (including reasonable attorneys’ fees) that the
Trustee may sustain as a result of such liability or obligations of the
Master
Servicer and in connection with the Trustee’s assumption (not including the
Trustee’s performance, except to the extent that costs or liability of the
Trustee are created or increased as a result of negligent or wrongful acts
or
omissions of the Master Servicer prior to its replacement as Master Servicer)
of
the Master Servicer’s obligations, duties or responsibilities under such
agreement.
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The
Trust
will indemnify the Master Servicer and hold it harmless against any and
all
claims, losses, penalties, fines, forfeitures, legal fees and related costs,
judgments, and any other costs, liabilities, fees and expenses that the
Master
Servicer may incur or sustain in connection with, arising out of or related
to
this Agreement or the Certificates, except to the extent that any such
loss,
liability or expense is related to (i) a material breach of the Master
Servicer’s representations and warranties in this Agreement, (ii) the
Master Servicer’s willful malfeasance, bad faith or negligence or by reason of
its reckless disregard of its duties and obligations under this Agreement
or
(iii) failure to provide the assessment, attestation and annual statement
of
compliance in accordance with Sections 3.22, 3.23 and 3.24; provided that
any
such loss, liability or expense constitutes an “unanticipated expense incurred
by the REMIC” within the meaning of Treasury Regulations
Section 1.860G-1(b)(3)(ii). The Master Servicer shall be entitled to
reimbursement for any such indemnified amount from funds on deposit in
the
Distribution Account. The Master Servicer shall not be liable for any course
of
action taken by the Servicer with respect to loss mitigation of defaulted
Mortgage Loans at the direction of the Credit Risk Manager or the Sponsor
pursuant to a Credit Risk Management Agreement or otherwise. Further, the
Master
Servicer shall not be liable for the performance by the Servicer under
any
Credit Risk Management Agreement.
Section
9.15 Duties
of the Credit Risk Manager.
(a) The
Certificateholders, by their purchase and acceptance of the Certificates,
appoint OfficeTiger Global Real Estate Services Inc., formerly known as
MortgageRamp, Inc., as Credit Risk Manager. For and on behalf of the Depositor
and the Trust, the Credit Risk Manager will provide reports and recommendations
concerning certain delinquent and defaulted Mortgage Loans, and as to the
collection of any Prepayment Charges with respect to the Mortgage Loans.
Such
reports and recommendations will be based upon the Monthly Statement and
information provided by the Servicer and the Master Servicer pursuant to
the
Credit Risk Management Agreement to the Credit Risk Manager by the Servicer
and
the Master Servicer. The Credit Risk Manager shall look solely to the Servicer,
the Master Servicer and to the Monthly Statement for all information and
data
(including loss and delinquency information and data) and loan level information
and data relating to the servicing of the Mortgage Loans and neither the
Securities Administrator nor the Trustee shall have any obligation to provide
any such information to the Credit Risk Manager and shall not otherwise
have any
responsibility under any Credit Risk Management Agreement. The Credit Risk
Manager shall be entitled to compensation from the Trust equal to the Credit
Risk Manager Fee.
(b) On
or
about the 15th calendar day of each month, the Credit Risk Manager shall
have
prepared and shall make available to the Depositor, the following
reports:
(i) Executive
Summary:
The
Executive Summary will consist of a brief high level summary of certain
key
performance metrics as well as a narrative summary of loans identified
and
reviewed for follow-up actions by the Servicer.
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(ii) General
Pool Characteristics:
This
report will contain a listing of various characteristics of the mortgage
loan
pool (including history and stratification) such as documentation levels,
occupancy status, weighted aging, CLTV, NOO rate, junior lien percentage,
etc.
(iii) Performance
Report:
This
report will graphically summarize the delinquency rates as well as the
loss
mitigation, foreclosure, REO, CPR and loss severity and related summary
information.
(iv) Prepayment
Analysis:
This
report will consist of a compilation and summary of various loan characteristics
for Mortgage Loans that have prepaid, along with prepayment premium
analytics.
(v) Servicer
Remittance Report:
This
report will consist of an analysis of any discrepancy between the monthly
servicer remittance file and the final monthly trust report including,
without
limitation, the collection of prepayment premiums.
(vi) OfficeTiger
Loan Review Report:
This
report will consist of a narrative summary with respect to the individual
loans
that have been flagged for manual review and follow-up consultation with
the
Servicer. This report may also include narrative summaries of the recommendation
of the Credit Risk Manager.
Section
9.16 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 the Trustee, the Securities
Administrator, 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 the Servicer, and the
Master
Servicer under the Credit Risk Management Agreements or for 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
or
by reason of reckless disregard for its obligations and duties under this
Agreement or the Credit Risk Management Agreements. 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 Servicer
and the
Master Servicer pursuant to the Credit Risk Management Agreements in the
performance of its duties thereunder and hereunder.
Section
9.17 Removal
and Resignation of Credit Risk Manager. The Credit Risk Manager may be
removed as Credit Risk Manager by Certificateholders holding not less than
66-2/3% of the Voting Rights of Certificates, in the exercise of its or
their
sole discretion, at any time, without cause, upon ten (10) days prior written
notice. The Certificateholders shall provide such written notice to the
Trustee
and upon receipt of such notice, the Trustee shall provide written notice
to the
Credit Risk Manager of its removal, effective upon receipt of such notice.
In
addition, on July 3, 2012 and each anniversary date thereafter, upon thirty
(30)
days prior written notice, the Credit Risk Manager will have the option
to
resign as Credit Risk Manager and the Depositor shall have the option to
terminate the Credit Risk Manager without cause.
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ARTICLE
X
CONCERNING
THE SECURITIES ADMINISTRATOR
Section
10.01 Duties
of Securities Administrator.
The
Securities Administrator shall undertake to perform such duties and only
such
duties as are specifically set forth in this Agreement.
The
Securities Administrator, upon receipt of all resolutions, certificates,
statements, opinions, reports, documents, orders or other instruments furnished
to the Securities Administrator that are specifically required to be furnished
pursuant to any provision of this Agreement, shall examine them to determine
whether they are in the form required by this Agreement; provided,
however,
that
the Securities Administrator shall not be responsible for the accuracy
or
content of any such resolution, certificate, statement, opinion, report,
document, order or other instrument. If any such instrument is found not
to
conform in any material respect to the requirements of this Agreement,
the
Securities Administrator shall notify the Certificateholders of such
non-conforming instrument in the event the Securities Administrator, after
so
requesting, does not receive a satisfactorily corrected instrument.
No
provision of this Agreement shall be construed to relieve the Securities
Administrator of liability for its own negligent action, its own negligent
failure to act or its own willful misconduct; provided,
however,
that:
(i) the
duties and obligations of the Securities Administrator shall be determined
solely by the express provisions of this Agreement, the Securities Administrator
shall not be liable except for the performance of such duties and obligations
as
are specifically set forth in this Agreement, no implied covenants or
obligations shall be read into this Agreement against the Securities
Administrator and the Securities Administrator may conclusively rely, as
to the
truth of the statements and the correctness of the opinions expressed therein,
upon any certificates or opinions furnished to the Securities Administrator
and
conforming to the requirements of this Agreement which it believed in good
faith
to be genuine and to have been duly executed by the proper authorities
respecting any matters arising hereunder;
(ii) the
Securities Administrator shall not be liable for any error of judgment
made in
good faith by a Responsible Officer or Responsible Officers of the Securities
Administrator, unless it shall be conclusively determined by a court of
competent jurisdiction, such determination not subject to appeal, that
the
Securities Administrator was negligent in ascertaining the pertinent
facts;
(iii) the
Securities Administrator shall not be liable with respect to any action
or
inaction taken, suffered or omitted to be taken by it in good faith in
accordance with the direction of Holders of Certificates evidencing not
less
than 25.00% of the Voting Rights of Certificates relating to the time,
method
and place of conducting any proceeding for any remedy available to the
Securities Administrator, or exercising or omitting to exercise any trust
or
power conferred upon the Securities Administrator under this Agreement;
and
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(iv) the
Securities Administrator shall not be accountable, shall have no liability
and
makes no representation as to any acts or omissions hereunder of the Master
Servicer or the Trustee.
Section
10.02 Certain
Matters Affecting the Securities Administrator.
Except
as otherwise provided in Section 10.01:
(i) the
Securities Administrator may request and conclusively rely upon and shall
be
fully protected in acting or refraining from acting upon any resolution,
Officer’s Certificate, certificate 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 and the Securities
Administrator shall have no responsibility to ascertain or confirm the
genuineness of any signature of any such party or parties;
(ii) the
Securities Administrator may consult with counsel, financial advisers or
accountants and the advice of any such counsel, financial advisers or
accountants and any advice or Opinion of Counsel shall be full and complete
authorization and protection in respect of any action taken or suffered
or
omitted by it hereunder in good faith and in accordance with such advice
or
Opinion of Counsel;
(iii) the
Securities Administrator shall not be liable for any action or inaction
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;
(iv) the
Securities Administrator shall not 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 so to do by Holders of Certificates
evidencing not less than 25.00% of the Voting Rights allocated to each
Class of Certificates; provided,
however,
that if
the payment within a reasonable time to 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 Securities Administrator, not reasonably
assured to the Securities Administrator by the security afforded to it
by the
terms of this Agreement, the Securities Administrator may require reasonable
indemnity against such expense or liability as a condition to so proceeding.
Nothing in this clause (iv) shall derogate from the obligation of the
Securities Administrator to observe any applicable law prohibiting disclosure
of
information regarding the Mortgagors, provided that the Securities Administrator
shall have no liability for disclosure required by this Agreement;
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(v) the
Securities Administrator may execute any of the trusts or powers hereunder
or
perform any duties hereunder either directly or by or through agents or
attorneys or a custodian and the Securities Administrator shall not be
responsible for any misconduct or negligence on the part of any such agent,
attorney or custodian appointed by the Securities Administrator with due
care;
(vi) the
Securities Administrator shall not be required to risk or expend its own
funds
or otherwise incur any financial liability in the performance of any of
its
duties or in the exercise of any of its rights or powers hereunder if it
shall
have reasonable grounds for believing that repayment of such funds or adequate
indemnity against such risk or liability is not assured to it, and none
of the
provisions contained in this Agreement shall in any event require the Securities
Administrator to perform, or be responsible for the manner of performance
of,
any of the obligations of the Master Servicer or the Trustee under this
Agreement;
(vii) the
Securities Administrator shall be under no obligation to exercise any of
the
trusts, rights or powers vested in it by 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
Securities Administrator reasonable security or indemnity satisfactory
to the
Securities Administrator against the costs, expenses and liabilities which
may
be incurred therein or thereby; and
(viii) the
Securities Administrator shall have no obligation to appear in, prosecute
or
defend any legal action that is not incidental to its duties hereunder
and which
in its opinion may involve it in any expense or liability; provided,
however,
that in
the event of a breach or default by the Derivative
Counterparty
under
the Cap Agreement or the Swap Agreement, the Securities Administrator shall
pursue all legal remedies available against the Derivative
Counterparty
under
the Cap Agreement or the Swap Agreement, as applicable, in consultation
with the
Depositor; provided,
further,
that
the Securities Administrator may in its discretion undertake any such action
that it may deem necessary or desirable in respect of this Agreement and
the
rights and duties of the parties hereto and the interests of the Trustee,
the
Securities Administrator and the Certificateholders hereunder. In such
event,
the legal expenses and costs of such action and any liability resulting
therefrom shall be expenses, costs and liabilities of the Trust Fund, and
the
Securities Administrator shall be entitled to be reimbursed therefor out
of the
Collection Account.
The
Securities Administrator shall have no duty (A) to undertake or ensure any
recording, filing, or depositing of this Agreement or any agreement referred
to
herein or any financing statement or continuation statement evidencing
a
security interest, or to see to the maintenance of any such recording or
filing
or depositing or to any rerecording, refiling or redepositing thereof,
(B) to procure or maintain any insurance or (C) to pay or discharge
any tax, assessment, or other governmental charge or any lien or encumbrance
of
any kind owing with respect to, assessed or levied against, any part of
the
Trust Fund other than from funds available in the Distribution
Account.
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Section
10.03 Securities
Administrator Not Liable for Certificates or Mortgage Loans.
The
recitals contained herein and in the Certificates shall be taken as the
statements of the Depositor or the transferor, as the case may be, and
the
Securities Administrator assumes no responsibility for their correctness.
The
Securities Administrator makes no representations as to the validity or
sufficiency of this Agreement, the Cap Agreement, the Swap Agreement, or
of the
Certificates or of any Mortgage Loan or related document other than with
respect
to the Securities Administrator’s execution and authentication of the
Certificates. The Securities Administrator shall not be accountable for
the use
or application by the Depositor, the Trustee, the Master Servicer, or the
Derivative Counterparty of any funds paid to the Depositor, the Trustee,
the
Master Servicer or the Derivative Counterparty in respect of the Mortgage
Loans
or deposited in or withdrawn from any Collection Account or any other fund
or
account with respect to the Certificates by the Depositor, the Trustee,
the
Master Servicer or the Derivative Counterparty.
The
Securities Administrator executes and authenticates the Certificates not
in its
individual capacity but solely as Securities Administrator of the Trust
Fund
created by this Agreement, in the exercise of the powers and authority
conferred
and vested in it by this Agreement. Each of the undertakings and agreements
made
on the part of the Securities Administrator on behalf of the Trust Fund
in the
Certificates is made and intended not as a personal undertaking or agreement
by
the Securities Administrator but is made and intended for the purpose of
binding
only the Trust Fund.
Section
10.04 Securities
Administrator May Own Certificates.
The
Securities Administrator in its individual or any other capacity may become
the
owner or pledgee of Certificates and may transact business with the parties
hereto and their Affiliates with the same rights as it would have if it
were not
the Securities Administrator.
Section
10.05 Securities
Administrator’s Fees and Expenses.
The
Securities Administrator shall be entitled to the investment income earned
on
amounts in the Distribution Account during the Securities Administrator
Float
Period. The Securities Administrator and any director, officer, employee,
agent
or “control person” within the meaning of the Securities Act of 1933, as
amended, and the Securities Exchange Act of 1934, as amended (“Control
Person”),
of
the Securities Administrator shall be indemnified by the Trust and held
harmless
against any loss, liability or expense (including reasonable attorney’s fees)
(i) incurred in connection with any claim or legal action relating to
(a) this Agreement, (b) the Mortgage Loans or (c) the
Certificates, other than any loss, liability or expense incurred by reason
of
willful misfeasance, bad faith or negligence in the performance of any
of the
Securities Administrator’s duties hereunder, (ii) incurred in connection
with the performance of any of the Securities Administrator’s duties hereunder,
other than any loss, liability or expense incurred by reason of willful
misfeasance, bad faith or negligence in the performance of any of the Securities
Administrator’s duties hereunder or (iii) incurred by reason of any action
of the Securities Administrator taken at the direction of the
Certificateholders, provided that any such loss, liability or expense
constitutes an “unanticipated expense incurred by the REMIC” within the meaning
of Treasury Regulations Section 1.860G 1(b)(3)(ii). Such indemnity shall
survive the termination of this Agreement or the resignation or removal
of the
Securities Administrator hereunder. Without limiting the foregoing, and
except
for any such expense, disbursement or advance as may arise from the Securities
Administrator’s negligence, bad faith or willful misconduct, or which would not
be an “unanticipated expense” within the meaning of the second preceding
sentence, the Securities Administrator shall be reimbursed by the Trust
for all
reasonable expenses, disbursements and advances incurred or made by the
Securities Administrator in accordance with any of the provisions of this
Agreement with respect to: (A) the reasonable compensation and the expenses
and disbursements of its counsel not associated with the closing of the
issuance
of the Certificates, (B) the reasonable compensation, expenses and
disbursements of any accountant, engineer, appraiser or other agent that
is not
regularly employed by the Securities Administrator, to the extent that
the
Securities Administrator must engage such Persons to perform acts or services
hereunder and (C) printing and engraving expenses in connection with
preparing any Definitive Certificates. The Trust shall fulfill its obligations
under this paragraph from amounts on deposit from time to time in the
Distribution Account.
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The
Securities Administrator 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.
Section
10.06 Eligibility
Requirements for Securities Administrator.
The
Securities Administrator hereunder shall at all times be a corporation
or
association organized and doing business under the laws the United States
of
America or any state thereof, authorized under such laws to exercise corporate
trust powers, having a combined capital and surplus of at least $50,000,000,
subject to supervision or examination by federal or state authority and
with a
credit rating of at least investment grade. If such corporation or association
publishes reports of condition at least annually, pursuant to law or to
the
requirements of the aforesaid supervising or examining authority, then
for the
purposes of this Section 10.06 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 condition so published.
In
case at any time the Securities Administrator shall cease to be eligible
in
accordance with the provisions of this Section 10.06, the Securities
Administrator shall resign immediately in the manner and with the effect
specified in Section 10.07 hereof. The entity serving as Securities
Administrator may have normal banking and trust relationships with the
Depositor
and its affiliates or the Trustee and its affiliates.
Any
successor securities administrator (i) may not be the Originator, the
Master Servicer, the Servicer, the Depositor or an affiliate of the Depositor
unless such successor securities administrator’s functions are operated through
an institutional trust department of the Securities Administrator,
(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/F1” by Fitch, if Fitch is a Rating Agency and if rated by Fitch, or the
equivalent rating by Standard & Poor’s or Moody’s. If no successor
securities administrator shall have been appointed and shall have accepted
appointment within 60 days after the Securities Administrator ceases to be
the Securities Administrator pursuant to Section 10.07, then the Trustee
may (but shall not be obligated to) become the successor securities
administrator. The Depositor shall appoint a successor to the Securities
Administrator in accordance with Section 10.07. The Trustee shall notify
the Rating Agencies of any change of Securities Administrator.
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Section
10.07 Resignation
and Removal of Securities Administrator.
The
Securities Administrator may at any time resign by giving written notice
of
resignation to the Depositor and the Trustee and each Rating Agency not
less
than 60 days before the date specified in such notice when, subject to
Section 10.08, such resignation is to take effect, and acceptance by a
successor securities administrator in accordance with Section 10.08 meeting
the qualifications set forth in Section 10.06. If no successor securities
administrator meeting such qualifications shall have been so appointed
by the
Depositor and have accepted appointment within 30 days after the giving of
such notice of resignation, the resigning Securities Administrator may
petition
any court of competent jurisdiction for the appointment of a successor
securities administrator.
If
at any
time the Securities Administrator shall cease to be eligible in accordance
with
the provisions of Section 10.06 hereof and shall fail to resign after
written request thereto by the Depositor, or if at any time the Securities
Administrator shall become incapable of acting, or shall be adjudged as
bankrupt
or insolvent, or a receiver of the Securities Administrator or of its property
shall be appointed, or any public officer shall take charge or control
of the
Securities Administrator or of its property or affairs for the purpose
of
rehabilitation, conservation or liquidation, or a tax is imposed with respect
to
the Trust Fund by any state in which the Securities Administrator or the
Trust
Fund is located and the imposition of such tax would be avoided by the
appointment of a different securities administrator, then the Depositor
may
remove the Securities Administrator and appoint a successor securities
administrator by written instrument, in triplicate, one copy of which instrument
shall be delivered to the Securities Administrator so removed, one copy
of which
shall be delivered to the Master Servicer and one copy to the successor
securities administrator.
The
Holders of Certificates entitled to at least 51.00% of the Voting Rights
may at
any time remove the Securities Administrator and appoint a 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 by the successor securities administrator
to the Trustee, one complete set to the Securities Administrator so removed
and
one complete set to the successor so appointed. Notice of any removal of
the
Securities Administrator shall be given to the Derivative Counterparty
and each
Rating Agency by the successor securities administrator.
Any
resignation or removal of the Securities Administrator and appointment
of a
successor securities administrator pursuant to any of the provisions of
this
Section 10.07 shall become effective upon acceptance by the successor
securities administrator of appointment as provided in Section 10.08
hereof.
If
at any
time, ▇▇▇▇▇ Fargo, as Securities Administrator, resigns under this
Section 10.07, or is removed as Securities Administrator pursuant to this
Section 10.07, then at such time ▇▇▇▇▇ Fargo shall also resign (and shall
be entitled to resign) as Master Servicer under this Agreement.
Section
10.08 Successor
Securities Administrator.
Any
successor securities administrator (which may be the Trustee) appointed
as
provided in Section 10.07 hereof shall execute, acknowledge and deliver to
the Depositor and to its predecessor Securities Administrator and the Trustee
an
instrument accepting such appointment hereunder and thereupon the resignation
or
removal of the predecessor Securities Administrator shall become effective
and
such 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 Securities Administrator herein. The Depositor, the Trustee, the
Master
Servicer and the 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 securities
administrator all such rights, powers, duties, and obligations.
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No
successor securities administrator shall accept appointment as provided
in this
Section 10.08 unless at the time of such acceptance such successor
securities administrator shall be eligible under the provisions of
Section 10.06 hereof and its appointment shall not adversely affect then
current rating of the Certificates, as confirmed in writing by each Rating
Agency.
Upon
acceptance by a successor securities administrator of appointment as provided
in
this Section 10.08, the Depositor shall mail notice of the succession of
such Securities Administrator hereunder to all Holders of Certificates
and the
Derivative Counterparty. If the Depositor fails to mail such notice within
10 days after acceptance by the successor securities administrator of
appointment, the successor securities administrator shall cause such notice
to
be mailed at the expense of the Depositor.
Section
10.09 Merger
or Consolidation of Securities Administrator.
Any
corporation or other entity into which the Securities Administrator may
be
merged or converted or with which it may be consolidated or any corporation
or
other entity resulting from any merger, conversion or consolidation to
which the
Securities Administrator shall be a party, or any corporation or other
entity
succeeding to the business of the Securities Administrator, shall be the
successor of the Securities Administrator hereunder, provided that such
corporation or other entity shall be eligible under the provisions of
Section 10.06 hereof, 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
10.10 Assignment
or Delegation of Duties by the Securities Administrator.
Except
as expressly provided herein, the Securities Administrator 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
the Securities Administrator; provided,
however,
that
the Securities Administrator shall have the right with the prior written
consent
of the Depositor (which shall not be unreasonably withheld or delayed),
and upon
delivery to the Trustee, the Derivative Counterparty and the Depositor
of a
letter from each Rating Agency to the effect that such action shall not
result
in a downgrade of the ratings assigned to any of the Certificates, to delegate
or assign to or subcontract with or authorize or appoint any qualified
Person to
perform and carry out any duties, covenants or obligations to be performed
and
carried out by the Securities Administrator hereunder. Notice of such permitted
assignment shall be given promptly by the Securities Administrator to the
Depositor and the Trustee. If, pursuant to any provision hereof, the duties
of
the Securities Administrator are transferred to a successor securities
administrator, the entire compensation payable to the Securities Administrator
pursuant hereto shall thereafter be payable to such successor securities
administrator but in no event shall the fee payable to the successor securities
administrator exceed that payable to the predecessor securities
administrator.
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ARTICLE
XI
TERMINATION
Section
11.01 Termination
upon Liquidation or Purchase of the Mortgage Loans. Subject to
Section 11.03, the obligations and responsibilities of the Depositor, the
Master Servicer, the Servicer, the Credit Risk Manager, the Securities
Administrator and the Trustee created hereby with respect to the Trust
Fund
shall terminate upon the earlier of (a) the exercise of an Option to Purchase,
on or after the Optional Termination Date, in the aggregate of all Mortgage
Loans (and REO Properties) at the price (the “Termination
Price”)
equal
to the sum of (i) 100.00% of the unpaid principal balance of each Mortgage
Loan (other than in respect of REO Property) plus accrued and unpaid interest
thereon at the applicable Mortgage Rate, (ii) the lesser of (x) the
appraised value of any REO Property as determined by the higher of two
appraisals completed by two independent appraisers selected by the Master
Servicer at the expense of that Trust Fund and (y) the unpaid principal
balance of each Mortgage Loan related to any REO Property, in each case
plus
accrued and unpaid interest thereon at the applicable Mortgage Rate,
(iii) amounts in reimbursement for Advances previously made with respect to
the Mortgage Loans and other amounts as to which the Servicer, the Depositor,
the Master Servicer, the Securities Administrator, the Credit Risk Manager
or
the Trustee are entitled to be paid or reimbursed pursuant to this Agreement
and
(iv) any Net Swap Payments remaining unpaid and any Swap Termination Payments
payable to the Swap Counterparty as a result of a termination pursuant
to this
Section 11.01 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 REO Property and
(ii) the distribution to 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 expiration of 21 years from the death of
the survivor of the descendants of ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇, the late Ambassador
of the
United States to the Court of St. James’s, living on the date
hereof.
Notwithstanding
anything to the contrary contained herein, no such purchase by the Master
Servicer (either upon instruction from the Depositor or voluntarily) shall
be
permitted unless (i) after distribution of the proceeds thereof to the
Certificateholders (other than the Holders of the Class X, Class P and
Residual Certificates and any other Classes of Certificates which constitute
NIM
Securities) pursuant to Section 11.02, the distribution of the remaining
proceeds to the Class X and Class P Certificates is sufficient to pay
the outstanding principal amount of and accrued and unpaid interest on
the NIM
Securities, to the extent the NIM Securities are then outstanding, or
(ii) prior to such purchase, the Master Servicer, remits to the Securities
Administrator an amount that, together with such remaining proceeds, will
be
sufficient to pay the outstanding principal amount of, and accrued and
unpaid
interest on, the NIM Securities, to the extent the NIM Securities are then
outstanding.
Section
11.02 Final
Distribution on the Certificates. If on any Remittance Date, the Master
Servicer determines that there are no Outstanding Mortgage Loans and no
other
funds or assets in the Trust Fund other than the funds in any Collection
Account, the Master Servicer shall direct the Securities Administrator
promptly
to send a Notice of Final Distribution to each Certificateholder and to
the Swap
Counterparty. If the Master Servicer (upon instruction from the Depositor
or
voluntarily) elects to exercise their option to purchase the Mortgage Loans
pursuant to clause (a) of Section 11.01, at least 20 days
prior to the date the Notice of Final Distribution is to be mailed to the
affected Certificateholders, the Master Servicer shall notify the Depositor,
the
Swap Counterparty and the Securities Administrator of (a) the date on which
the Master Servicer intends to exercise such purchase option and (b) the
Termination Price.
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A
Notice
of Final Distribution, specifying the Distribution Date on which
Certificateholders may surrender their Certificates for payment of the
final
distribution and cancellation, shall be given promptly by the Securities
Administrator by letter to Certificateholders mailed not earlier than the
10th
day and not later than the 15th day of the month of such final distribution.
Any
such Notice of Final Distribution shall specify (a) the Distribution Date
upon which final distribution on the Certificates will be made upon presentation
and surrender of 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 of Final Distribution to the Swap Counterparty and to
each
Rating Agency at the time such Notice of Final Distribution is given to
Certificateholders.
In
the
event such Notice of Final Distribution is given, the Servicer shall cause
all
funds in the Collection Account to be remitted to the Master Servicer for
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 such final deposit with respect to the Trust Fund and
the
receipt by the Custodian of a Request for Release therefor, the Custodian
shall
promptly release to the Servicer the Custodial Files for the Mortgage
Loans.
Upon
presentation and surrender of the Certificates, the Securities Administrator
shall cause to be distributed to the Certificateholders of each
Class (after reimbursement of all amounts due to the Servicer, the Master
Servicer, the Securities Administrator, the Depositor, the Trustee and
the Swap
Counterparty hereunder and payment of any amounts due to the Supplemental
Interest Trust as provided under Section 4.02), in each case on the final
Distribution Date and in the order set forth in Section 4.02, in proportion
to their respective Percentage Interests, with respect to Certificateholders
of
the same Class, up to an amount equal to (i) as to each Class of
Regular Certificates (except the Class X Certificates), the Certificate
Balance thereof plus for each such Class and the Class X Certificates
accrued interest thereon in the case of an interest-bearing Certificate
and all
other amounts to which such Classes are entitled pursuant to Section 4.02
and (ii) as to the Residual Certificates, the amount, if any, which remains
on deposit in the Distribution Account (other than the amounts retained
to meet
claims) after application pursuant to clause (i) above.
In
the
event that any affected Certificateholders shall not surrender Certificates
for
cancellation within six months after the date specified in the Notice of
Final
Distribution, 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 months after such second notice all the applicable 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 which
remain a
part of the Trust Fund. If within one year after the second notice all
Certificates shall not have been surrendered for cancellation, the Class R
Certificateholders shall be entitled to all unclaimed funds and other assets
of
the Trust Fund which remain subject hereto.
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Section
11.03 Additional
Termination Requirements. In the event an Option to Purchase is exercised
with respect to the Mortgage Loans as provided in Section 11.01, the Trust
Fund shall be terminated in accordance with the following additional
requirements, unless the Trustee has been supplied with an Opinion of Counsel,
at the expense of the party upon whose instruction causes the exercise
of an
Option to Purchase (with notice to the Derivative Counterparty of such
Option to
Purchase), to the effect that the failure to comply with the requirements
of
this Section 11.03 will not (i) result in the imposition of taxes on
“prohibited transactions” on any REMIC formed hereby as defined in
Section 860F of the Code or (ii) cause any REMIC formed hereby to fail
to qualify as a REMIC at any time that any Certificates are
outstanding:
(a) The
Securities Administrator on behalf of the Trustee shall sell all of the
assets
of the Trust Fund to the party exercising the Option to Purchase, and,
within
90 days of such sale, shall distribute to the Certificateholders the
proceeds of such sale in complete liquidation of each REMIC formed hereby;
and
(b) The
Securities Administrator shall attach a statement to the final federal
income
tax return for each REMIC formed hereby stating that pursuant to Treasury
Regulations Section 1.860F-1, the first day of the 90-day liquidation
period for each such REMIC was the date on which the Securities Administrator
on
behalf of the Trustee sold the assets of the Trust Fund to the Master
Servicer.
ARTICLE
XII
MISCELLANEOUS
PROVISIONS
Section
12.01 Amendment.
This Agreement may be amended from time to time by the Depositor, the
Originator, the Master Servicer, the Servicer, the Securities Administrator
and
the Trustee, without the consent of any of the Certificateholders or the
Derivative Counterparty (except to the extent that the rights or obligations
of
the Derivative Counterparty under the Cap Agreement or the Swap Agreement
are
affected thereby, and except to the extent that the ability of the Securities
Administrator to perform fully and timely its obligations under the Cap
Agreement or the Swap Agreement is adversely affected, in which case prior
written consent of the Derivative Counterparty is required) (i) to cure any
ambiguity or mistake, (ii) to correct any defective provision herein or to
supplement any provision herein which may be inconsistent with any other
provision herein, (iii) to add to the duties of the Depositor, the Master
Servicer, the Servicer, the Securities Administrator or the Trustee,
(iv) to add any other provisions with respect to matters or questions
arising hereunder, (v) to modify, alter, amend, add to or rescind any of
the terms or provisions contained in this Agreement, (vi) to comply with
the
requirements of the Internal Revenue Code or (vii) to conform this agreement
to
the Offering Documents provided to investors in connection with the offering
of
the Certificates; provided,
that
any action pursuant to clause (iv) or (v) above shall not, as
evidenced by an Opinion of Counsel (which Opinion of Counsel shall not
be an
expense of the Trustee, the Master Servicer, the Securities Administrator
or the
Trust Fund), adversely affect in any material respect the interests of
any
Certificateholder; provided,
further,
that
any such action pursuant to clause (iv) or (v) above shall not be
deemed to adversely affect in any material respect the interests of the
Certificateholders if the Person requesting the amendment obtains a letter
from
each Rating Agency stating that the amendment would not result in the
downgrading or withdrawal of the respective ratings then assigned to the
Certificates; it being understood and agreed that any such letter in and
of
itself will not represent a determination as to the materiality of any
such
amendment and will represent a determination only as to the credit issues
affecting any such rating. The Trustee, the Depositor, the Master Servicer,
the
Originator, the Servicer and the Securities Administrator also may at any
time
and from time to time amend this Agreement, but without the consent of
the
Certificateholders or the Derivative Counterparty (except to the extent
that the
rights or obligations of the Derivative Counterparty hereunder or under
the Cap
Agreement or the Swap Agreement are affected thereby, and except to the
extent
that the ability of the Supplemental Interest Trust Trustee to perform
fully and
timely its obligations under the Cap Agreement or the Swap Agreement is
adversely affected, in which case prior written consent of the Derivative
Counterparty is required) to modify, eliminate or add to any of its provisions
to such extent as shall be necessary or helpful to (i) maintain the
qualification of each REMIC created hereunder under the Code, (ii) avoid or
minimize the risk of the imposition of any tax on any REMIC created hereunder
pursuant to the Code that would be a claim at any time prior to the final
redemption of the Certificates or (iii) comply with any other requirements
of the Code; provided,
that
the Trustee and the Master Servicer have 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 helpful to, as applicable, (i) maintain
such qualification, (ii) avoid or minimize the risk of the imposition of
such a tax or (iii) comply with any such requirements of the
Code.
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This
Agreement may also be amended from time to time by the Depositor, the Master
Servicer, the Servicer, the Originator, the Securities Administrator and
the
Trustee, but with the consent of the Holders of Certificates evidencing
Percentage Interests aggregating not less than 662/3%
of each
Class of Certificates affected thereby 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; provided,
however,
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) adversely affect in any
material respect the interests of the Holders of any Class of Certificates
in a manner other than as described in clause (i), without the consent of
the Holders of Certificates of such Class evidencing, as to such Class,
Percentage Interests aggregating not less than 662/3%,
(iii) reduce the aforesaid percentages of Certificates the Holders of which
are required to consent to any such amendment, without the consent of the
Holders of all such Certificates then outstanding or (iv) adversely affect
the
rights or obligations of the Derivative Counterparty hereunder or under
the Cap
Agreement or the Swap Agreement or the rights of the Securities Administrator,
as the Supplemental Interest Trust Trustee, to fully and timely perform
its
obligations under the Cap Agreement or the Swap Agreement without obtaining
the
prior written consent of the Derivative Counterparty.
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Notwithstanding
any contrary provision of this Agreement, the Trustee and the Master Servicer
shall not consent to any amendment to this Agreement unless (i) it shall
have first received an Opinion of Counsel, which opinion shall not be an
expense
of the Trustee, the Master Servicer or the Trust Fund, to the effect that
such
amendment will not cause the imposition of any tax on any REMIC created
hereunder or the Certificateholders or cause any such REMIC to fail to
qualify
as a REMIC at any time that any Certificates are outstanding and (ii) the
party seeking such amendment shall have provided written notice to the
Rating
Agencies (with a copy of such notice to the Trustee, the Master Servicer
and the
Derivative Counterparty) of such amendment, stating the provisions of the
Agreement to be amended.
Notwithstanding
the foregoing provisions of this Section 12.01, with respect to any
amendment that significantly modifies the permitted activities of the Trustee
or
the Servicer, any Certificate beneficially owned by the Depositor shall
be
deemed not to be outstanding (and shall not be considered when determining
the
percentage of Certificateholders consenting or when calculating the total
number
of Certificates entitled to consent) for purposes of determining if the
requisite consents of Certificateholders under this Section 12.01 have been
obtained.
Promptly
after the execution of any amendment to this Agreement requiring the consent
of
Certificateholders, the Trustee shall furnish written notification of the
substance or a copy of such amendment to each Certificateholder and each
Rating
Agency.
It
shall
not be necessary for the consent of Certificateholders under this
Section 12.01 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.
Nothing
in this Agreement shall require the Trustee, the Master Servicer or the
Securities Administrator to enter into an amendment without receiving an
Opinion
of Counsel (which opinion shall not be an expense of the Trustee, the Master
Servicer, the Securities Administrator or the Trust Fund), satisfactory
to the
Trustee, the Master Servicer and the Securities Administrator, as applicable,
that (i) such amendment is permitted and is not prohibited by this
Agreement and that all requirements for amending this Agreement have been
complied with and (ii) either (A) the amendment does not adversely
affect in any material respect the interests of any Certificateholder or
(B) the conclusion set forth in the immediately preceding
clause (A) is not required to be reached pursuant to this
Section 12.01.
Notwithstanding
the foregoing, the consent of Originator shall not be required to enter
into any
amendment to this Agreement unless such amendment would potentially have
a
material and adverse effect on the rights or obligations of the Originator
under
this Agreement.
Section
12.02 Recordation
of Agreement; Counterparts. 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 or all of the Mortgaged Properties
are situated, and in any other appropriate public recording office or elsewhere,
such recordation to be effected by the Securities Administrator at the
direction
and expense of the Depositor, but only upon receipt of an Opinion of Counsel
to
the effect that such recordation materially and beneficially affects the
interests of the Certificateholders.
-156-
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
12.03 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.
Section
12.04 Intention
of Parties. (a) It is intended that the conveyance of the Depositor’s right,
title and interest in and to property constituting the Trust Fund pursuant
to
this Agreement shall constitute, and shall be construed as, a sale of such
property and not a grant of a security interest to secure a loan. However,
if
such conveyance is deemed to be in respect of a loan, it is intended that:
(1)
the rights and obligations of the parties shall be established pursuant
to the
terms of this Agreement; (2) the Depositor hereby grants to the Trustee
for the
benefit of the Holders of the Certificates a first priority security interest
to
secure repayment of an obligation in an amount equal to the aggregate Class
Certificate Balances of the Certificates in all of the Depositor’s right, title
and interest in, to and under, whether now owned or hereafter acquired,
the
Trust Fund and the Supplemental Interest Trust and all proceeds of any
and all
property constituting the Trust Fund and the Supplemental Interest Trust
to
secure payment of the Certificates (such security interest being, to the
extent
of the assets that constitute the Supplemental Interest Trust, pari
passu
with the
security interest as provided in clause (4) below); (3) this Agreement
shall
constitute a security agreement under applicable law; and (4) the Derivative
Counterparty shall be deemed, during the term of such agreement and while
such
agreement is the property of the Trustee, to have a security interest in
all of
the assets that constitute the Supplemental Interest Trust, but only to
the
extent of such Derivative Counterparty’s right to payment under the Derivative
Agreements (such security interest being pari
passu
with the
security interest as provided in clause (2) above). If such conveyance
is deemed
to be in respect of a loan and the trust created by this Agreement terminates
prior to the satisfaction of the claims of any Person holding any Certificate,
the security interest created hereby shall continue in full force and effect
and
the Trustee shall be deemed to be the collateral agent for the benefit
of such
Person, and all proceeds shall be distributed by the Securities Administrator
as
herein provided.
(b) The
Depositor shall, to the extent consistent with this Agreement, take such
reasonable actions as may be necessary to ensure that, if this Agreement
were
deemed to create a security interest in the Mortgage Loans and the other
property described above, such security interest would be deemed to be
a
perfected security interest of first priority under applicable law and
shall be
maintained as such throughout the term of this Agreement. The Depositor
shall,
at its own expense, make all initial filings on or about the Closing Date
and
shall forward a copy of such filing or filings to the Trustee. Without
limiting
the generality of the foregoing, the Depositor shall prepare and forward
for
filing, or shall cause to be forwarded for filing, at the expense of the
Depositor, all filings necessary to maintain the effectiveness of any original
filings necessary under the relevant UCC to perfect the Trustee’s security
interest in or lien on the Mortgage Loans, including without limitation
(x)
continuation statements, and (y) such other statements as may be occasioned
by
(1) any change of name of the Sponsor, the Depositor or the Trustee, (2)
any
change of location of the jurisdiction of organization of the Sponsor or
the
Depositor, (3) any transfer of any interest of the Sponsor or the Depositor
in
any Mortgage Loan or (4) any change under the relevant UCC or other applicable
laws. Neither the Sponsor nor the Depositor shall organize under the law
of any
jurisdiction other than the State under which each is organized as of the
Closing Date (whether changing its jurisdiction of organization or organizing
under an additional jurisdiction) without giving 30 days prior written
notice of
such action to its immediate and intermediate transferee, including the
Trustee.
Before effecting such change, the Sponsor or the Depositor proposing to
change
its jurisdiction of organization shall prepare and file in the appropriate
filing office any financing statements or other statements necessary to
continue
the perfection of the interests of its immediate and intermediate transferees,
including the Trustee, in the Mortgage Loans. In connection with the
transactions contemplated by this Agreement, each of the Sponsor and the
Depositor authorizes its immediate or intermediate transferee to file in
any
filing office any initial financing statements, any amendments to financing
statements, any continuation statements, or any other statements or filings
described in this paragraph (b).
-157-
Section
12.05 Notices.
(a) 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 Event of Default that has not been cured;
3. The
resignation or termination of the Servicer, the Master Servicer, the Securities
Administrator or the Trustee and the appointment of any successor;
4. The
repurchase or substitution of Mortgage Loans pursuant to Section 2.03;
and
5. The
final
payment to Certificateholders; and
6. An
Early
Termination Event with respect to the Cap Agreement or the Swap
Agreement.
(b) In
addition, the Securities Administrator shall promptly make available on
its
internet website to each Rating Agency copies of the following:
1. Each
report to Certificateholders described in Section 4.03; and
-158-
2. Any
notice of a purchase of a Mortgage Loan pursuant to
Section 2.03.
(c) All
directions, demands, consents and notices hereunder shall be in writing
and
shall be deemed to have been duly given when delivered to:
(i) in
the
case of the Depositor,
HSI
Asset Securitization Corporation, ▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇
▇▇▇▇▇,
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇, Attention: Head MBS Principal Finance, or such
other
address as may be hereafter furnished to the other parties by the Depositor
in
writing;
(ii) in
the
case of the Originator or Servicer,
to
▇▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇, ▇.▇., ▇ ▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇-▇▇▇▇,
Attention: ▇▇▇▇ ▇. ▇▇▇▇▇, MAC X2302-033 with a copy to ▇▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇,
▇.▇., ▇ ▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇-▇▇▇▇, Attention: General Counsel,
MAC X2401-06T;
(iii) in
the
case of ▇▇▇▇▇ Fargo as Master Servicer,
▇▇▇▇▇
Fargo Bank, N.A., ▇.▇. ▇▇▇ ▇▇, ▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇ ▇▇▇▇▇, with a copy to
▇▇▇▇ ▇▇▇
▇▇▇▇▇▇▇▇▇ ▇▇▇▇, ▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇ ▇▇▇▇▇, Attention: Client Service Manager
--
HASCO 2007-WF1, or such other address as may be hereafter furnished to
the to
the other parties by ▇▇▇▇▇ Fargo in writing;
(iv) in
the
case of the Trustee,
the
Corporate Trust Office (Attention: HB06WF1), or such other address as may
be
hereafter furnished to the to the other parties by the Trustee in
writing;
(v) in
the
case of the Derivative Counterparty,
Credit
Suisse International, One ▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇▇ ▇▇▇ ▇▇▇, ▇▇▇▇▇▇▇, Attention:
Managing Director—Legal Department;
(vi) in
the
case of each of the Rating Agencies,
the
address specified therefor in the definition corresponding to the name
of such
Rating Agency; and
(vii) in
the
case of the Credit Risk Manager,
OfficeTiger Global Real Estate Services Inc., ▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇, ▇▇▇▇▇
▇▇▇▇,
▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇, Attention: General Counsel. Notices to Certificateholders
shall be deemed given when mailed, first class postage prepaid, to their
respective addresses appearing in the Certificate Register.
Section
12.06 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
12.07 Assignment.
Notwithstanding anything to the contrary contained herein, except as provided
in
Section 6.02, this Agreement may not be assigned by the Servicer without
the prior written consent of the Master Servicer, the Securities Administrator,
the Trustee and Depositor; provided,
however,
that
the Servicer may pledge its interest in any reimbursements for P&I Advances
or Servicing Advances hereunder.
-159-
Section
12.08 Limitation
on Rights of Certificateholders. The death or incapacity of any
Certificateholder shall not operate to terminate this Agreement or the
trust
created hereby, 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 created hereby, 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 an
Event
of Default and of the continuance thereof, as herein provided, and unless
the
Holders of Certificates evidencing not less than 25.00% 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 reasonable indemnity
as it
may require against the costs, expenses, and liabilities to be incurred
therein
or thereby, and the Trustee, for 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 12.08, each and every Certificateholder and
the Trustee shall be entitled to such relief as can be given either at
law or in
equity.
Section
12.09 Inspection
and Audit Rights. The Servicer agrees that, on reasonable prior notice,
which shall not be less than two Business Days prior written notice, it
will
permit any representative of the Depositor, the Master Servicer and/or
the
Trustee during the Servicer’s normal business hours, to examine all the books of
account, records, reports and other papers of the Servicer relating to
the
Mortgage Loans, to make copies and extracts therefrom, to cause such books
to be
audited by independent certified public accountants selected by the Depositor,
the Master Servicer and/or the Trustee and to discuss its affairs, finances
and
accounts relating to the Mortgage Loans with its officers, employees and
independent public accountants (and by this provision the Servicer hereby
authorizes said accountants to discuss with such representative such affairs,
finances and accounts), all at such reasonable times and as often as may
be
reasonably requested. Any out-of-pocket expense of the Servicer incident
to the
exercise by the Depositor, the Master Servicer and/or the Trustee of any
right
under this Section 12.09 shall be borne by the Servicer.
-160-
Section
12.10 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 Securities Administrator pursuant to this
Agreement, are and shall be deemed fully paid.
Section
12.11 Rule of
Construction. Article and section headings are for the convenience of the
reader and shall not be considered in interpreting this Agreement or the
intent
of the parties hereto.
Section
12.12 Waiver
of Jury Trial. EACH PARTY HEREBY KNOWINGLY, VOLUNTARILY AND INTENTIONALLY,
WAIVES (TO THE EXTENT PERMITTED BY APPLICABLE LAW) ANY RIGHT IT MAY HAVE
TO A
TRIAL BY JURY OF ANY DISPUTE ARISING UNDER OR RELATING TO THIS AGREEMENT
AND
AGREES THAT ANY SUCH DISPUTE SHALL BE TRIED BEFORE A JUDGE SITTING WITHOUT
A
JURY.
[SIGNATURE
PAGE FOLLOWS]
-161-
IN
WITNESS WHEREOF, each of the parties below have caused their names to be
signed
hereto by their respective officers thereunto duly authorized as of the
day and
year first above written.
HSI
ASSET SECURITIZATION
CORPORATION,
as Depositor
By /s/
▇▇▇▇▇▇
▇▇▇▇▇
Name:
▇▇▇▇▇▇ ▇▇▇▇▇
Title:
Vice President
DEUTSCHE
BANK NATIONAL TRUST
COMPANY,
as Trustee
By:
/s/
▇▇▇▇▇▇
▇▇▇▇▇
Name:
▇▇▇▇▇▇ ▇▇▇▇▇
Title:
Authorized Signer
By:
/s/
▇▇▇▇▇▇▇
▇▇▇▇▇▇
Name:
▇▇▇▇▇▇▇ ▇▇▇▇▇▇
Title:
Vice President
▇▇▇▇▇
FARGO BANK, N.A., as Master
Servicer
By:
/s/
▇▇▇▇▇▇
▇▇▇▇
Name:
▇▇▇▇▇▇ ▇▇▇▇
Title:
Vice President
▇▇▇▇▇
FARGO BANK, N.A., as Securities
Administrator
By:
/s/
▇▇▇▇▇▇
▇▇▇▇
Name:
▇▇▇▇▇▇ ▇▇▇▇
Title:
Vice President
▇▇▇▇▇
FARGO BANK, N.A., as Custodian
By: /s/
▇▇▇▇▇▇▇ ▇
▇▇▇▇▇▇▇
Name:
▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇
Title:
Vice President
▇▇▇▇▇
FARGO BANK, N.A., as Originator
By:
/s/ ▇▇▇▇▇▇▇▇ ▇
▇▇▇▇
Name:
▇▇▇▇▇▇▇▇ ▇ ▇▇▇▇
Title:
Assistant Vice President
▇▇▇▇▇
FARGO BANK, N.A., as Servicer
By:
/s/ ▇▇▇▇▇▇▇▇ ▇
▇▇▇▇
Name:
▇▇▇▇▇▇▇▇ ▇ ▇▇▇▇
Title:
Assistant Vice President
OFFICETIGER
GLOBAL REAL ESTATE
SERVICES
INC., as Credit Risk Manager
By: /s/
▇▇▇ ▇
▇▇▇▇▇
Name:
▇▇▇ ▇ ▇▇▇▇▇
Title:
President
ACKNOWLEDGED
BY HSBC BANK USA,
NATIONAL
ASSOCIATION,
as
Sponsor, solely for the purposes of
Section
2.03(k).
By:
/s/ ▇▇▇▇
▇▇▇▇▇
Name:
▇▇▇▇ ▇▇▇▇▇
Title:
Managing Director #15252
SCHEDULE
I
Mortgage
Loan Schedule
[To
be
retained in a separate closing binder entitled “HASCO 2007-WF1 Mortgage Loan
Schedules” at the Washington, D.C. offices of ▇▇▇▇▇ ▇▇▇▇▇▇ LLP]
SCH-I-1
EXHIBIT
A
[IF
THIS
CERTIFICATE IS A PHYSICAL CERTIFICATE, NEITHER THIS CERTIFICATE NOR ANY
INTEREST
HEREIN MAY BE TRANSFERRED UNLESS THE PROPOSED TRANSFEROR DELIVERS TO THE
SECURITIES ADMINISTRATOR A TRANSFEROR LETTER (THE “TRANSFEROR
LETTER”)
IN THE
FORM OF EXHIBIT H TO THE AGREEMENT REFERRED TO HEREIN AND EITHER
(I) THE SECURITIES ADMINISTRATOR RECEIVES A RULE 144A INVESTMENT LETTER
(THE “144A
INVESTMENT LETTER”)
OR A
REGULATION S INVESTMENT LETTER (THE “REGULATION S INVESTMENT LETTER”) IN THE
FORM OF EXHIBIT I-A AND EXHIBIT I-B, RESPECTIVELY, TO THE AGREEMENT
REFERRED TO HEREIN OR (II) THE SECURITIES ADMINISTRATOR RECEIVES AN OPINION
OF COUNSEL, DELIVERED AT THE EXPENSE OF THE TRANSFEROR, THAT SUCH TRANSFER
MAY
BE MADE WITHOUT REGISTRATION UNDER THE SECURITIES ACT OF 1933, AS AMENDED.]
[To
be added to the Class M-10 Certificates while such Certificates remain
Private Certificates.]
[IF
THIS
CERTIFICATE IS A BOOK-ENTRY CERTIFICATE, THE PROPOSED TRANSFEROR WILL BE
DEEMED
TO HAVE MADE EACH OF THE CERTIFICATIONS SET FORTH IN THE TRANSFEROR LETTER
AND
THE PROPOSED TRANSFEREE WILL BE DEEMED TO HAVE MADE EACH OF THE CERTIFICATIONS
SET FORTH IN THE RULE 144A INVESTMENT LETTER OR REGULATION S INVESTMENT
LETTER,
AS APPLICABLE, IN EACH CASE AS IF SUCH CERTIFICATE WERE EVIDENCED BY A
PHYSICAL
CERTIFICATE.] [To be added to the Class M-10 Certificates while such
Certificates remain Private Certificates.]
UNLESS
THIS CERTIFICATE IS PRESENTED BY AN AUTHORIZED REPRESENTATIVE OF THE DEPOSITORY
TRUST COMPANY, A NEW YORK CORPORATION (“DTC”),
TO
ISSUER OR ITS AGENT FOR REGISTRATION OF TRANSFER, EXCHANGE, OR PAYMENT,
AND ANY
CERTIFICATE ISSUED IS REGISTERED IN THE NAME OF CEDE & CO. OR IN SUCH OTHER
NAME AS IS REQUESTED BY AN AUTHORIZED REPRESENTATIVE OF DTC (AND ANY PAYMENT
IS
MADE TO CEDE & CO. OR TO SUCH OTHER ENTITY AS IS REQUESTED BY AN AUTHORIZED
REPRESENTATIVE OF DTC), ANY TRANSFER, PLEDGE, OR OTHER USE HEREOF FOR VALUE
OR
OTHERWISE BY OR TO ANY PERSON IS WRONGFUL INASMUCH AS THE REGISTERED OWNER
HEREOF, CEDE & CO., HAS AN INTEREST HEREIN.
SOLELY
FOR U.S. FEDERAL INCOME TAX PURPOSES, THIS CERTIFICATE REPRESENTS AN INTEREST
IN
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, AS AMENDED (THE “CODE”),
AND
CERTAIN OTHER ASSETS.
[PRIOR
TO
TERMINATION OF THE SWAP AGREEMENT AND THE CAP AGREEMENT, NO TRANSFER OF
THIS
CERTIFICATE SHALL BE MADE UNLESS THE SECURITIES ADMINISTRATOR SHALL HAVE
RECEIVED A REPRESENTATION LETTER FROM THE TRANSFEREE OF THIS CERTIFICATE
TO THE
EFFECT THAT EITHER (I) SUCH TRANSFEREE IS NEITHER AN EMPLOYEE BENEFIT PLAN
OR
OTHER RETIREMENT ARRANGEMENT WHICH IS SUBJECT TO SECTION 406 OF ERISA AND/OR
SECTION 4975 OF THE CODE OR ANY ENTITY WHOSE UNDERLYING ASSETS INCLUDE
SUCH
PLAN’S OR ARRANGEMENT’S ASSETS BY REASON OF THEIR INVESTMENT IN THE ENTITY (A
“PLAN”) NOR A PERSON ACTING ON BEHALF OF ANY SUCH PLAN OR USING THE ASSETS OF
ANY SUCH PLAN TO EFFECT SUCH TRANSFER OR (II) THE ACQUISITION AND HOLDING
OF
THIS CERTIFICATE ARE ELIGIBLE FOR EXEMPTIVE RELIEF UNDER THE
STATUTORY EXEMPTION FOR NON-FIDUCIARY SERVICE PROVIDERS UNDER SECTION
408(b)(17)
OF
ERISA AND SECTION 4975(d)(20)
OF
THE CODE, PROHIBITED TRANSACTION CLASS EXEMPTION (“PTCE”) 84-14, PT▇▇ ▇▇-▇, ▇▇▇▇
▇▇-▇▇, ▇▇▇▇ ▇5-60 OR PTCE 96-23 OR SOME OTHER APPLICABLE EXEMPTION.
ANY
PURPORTED TRANSFER OF THIS CERTIFICATE PRIOR TO THE TERMINATION OF THE
SWAP
AGREEMENT AND THE CAP AGREEMENT TO OR ON BEHALF OF A PLAN WITHOUT THE DELIVERY
TO THE SECURITIES ADMINISTRATOR OF A REPRESENTATION LETTER AS DESCRIBED
ABOVE
SHALL BE VOID AND OF NO EFFECT. IF THIS CERTIFICATE IS A BOOK-ENTRY CERTIFICATE,
THE TRANSFEREE WILL BE DEEMED TO HAVE MADE A REPRESENTATION AS PROVIDED
IN
CLAUSE (I) OR (II) OF THIS PARAGRAPH, AS APPLICABLE.] [To
be
added to all Offered Certificates and Class M-10 Certificates.]
EXH-A-1
[THE
HOLDER OF THIS CERTIFICATE BY ITS ACCEPTANCE HEREOF REPRESENTS AND WARRANTS
THAT
(A) UNTIL THE EXPIRATION OF THE APPLICABLE “DISTRIBUTION COMPLIANCE PERIOD”
WITHIN THE MEANING OF REGULATION S, ANY OFFER, SALE, PLEDGE OR OTHER TRANSFER
OF
THIS CERTIFICATE SHALL NOT BE MADE IN THE UNITED STATES OR TO, OR FOR THE
ACCOUNT OR BENEFIT OF, ANY U.S. PERSON (EACH AS DEFINED IN REGULATION S)
AND (B)
IF THIS CERTIFICATE IS HELD WITHIN THE UNITED STATES OR SUCH HOLDER IS
A U.S.
PERSON OR THIS CERTIFICATE IS HELD FOR THE ACCOUNT OR SUCH BENEFIT OF,
A U.S.
PERSON (EACH AS DEFINED IN REGULATION S) SUCH CERTIFICATE WAS ACQUIRED
ONLY (1)
PURSUANT TO A REGISTRATION STATEMENT WHICH HAS BEEN DECLARED EFFECTIVE
UNDER THE
1933 ACT OR (2) BY SUCH HOLDER AS A “QUALIFIED INSTITUTIONAL BUYER” AS DEFINED
IN RULE 144A UNDER THE 1933 ACT THAT PURCHASES FOR ITS OWN ACCOUNT OR FOR
THE
ACCOUNT OF A QUALIFIED INSTITUTIONAL BUYER TO WHOM NOTICE IS GIVEN THAT
THE
TRANSFER IS BEING MADE IN RELIANCE ON RULE 144A.][For any Private Certificate
to
be acquired or transferred pursuant to Regulation S.]
EXH-A-2
|
Certificate
No:
|
1
|
|
|
Cut-off
Date:
|
June
1, 2007
|
|
|
First
Distribution Date:
|
July
25, 2007
|
|
|
Initial
Certificate Balance of this Certificate (“Denomination”):
|
$[ ]
|
|
|
Initial
Certificate Balances of all Certificates of this Class:
|
||
|
I-A
|
$195,515,000.00
|
|
|
II-A-1
|
$180,356,000.00
|
|
|
II-A-2
|
$33,480,000.00
|
|
|
II-A-3
|
$87,647,000.00
|
|
|
II-A-4
|
$27,822,000.00
|
|
|
M-1
|
$29,797,000.00
|
|
|
M-2
|
$23,390,000.00
|
|
|
M-3
|
$6,728,000.00
|
|
|
M-4
|
$7,690,000.00
|
|
|
M-5
|
$7,049,000.00
|
|
|
M-6
|
$4,806,000.00
|
|
|
M-7
|
$7,049,000.00
|
|
|
M-8
|
$5,126,000.00
|
|
|
M-9
|
$6,408,000.00
|
|
|
M-10
|
$7,690,000.00
|
|
EXH-A-3
|
Interest
Rate:
|
||
|
I-▇
|
▇▇▇▇▇▇▇▇
|
|
|
▇▇-▇-▇
|
▇▇▇▇▇▇▇▇
|
|
|
▇▇-▇-▇
|
▇▇▇▇▇▇▇▇
|
|
|
▇▇-▇-▇
|
▇ariable
|
|
|
II-A-4
|
Variable
|
|
|
M-▇
|
▇▇▇▇▇▇▇▇
|
|
|
▇-▇
|
▇▇▇▇▇▇▇▇
|
|
|
▇-▇
|
▇ariable
|
|
|
M-▇
|
▇▇▇▇▇▇▇▇
|
|
|
▇-▇
|
▇ariable
|
|
|
M-▇
|
▇▇▇▇▇▇▇▇
|
|
|
▇-▇
|
▇▇▇▇▇▇▇▇
|
|
|
▇-▇
|
▇ariable
|
|
|
M-▇
|
▇▇▇▇▇▇▇▇
|
|
|
▇-▇▇
|
▇▇▇▇▇▇▇▇
|
|
|
▇▇▇▇▇:
|
||
|
▇-▇
|
▇▇▇▇▇▇
▇A3
|
|
|
II-A-1
|
40431R
AB1
|
|
|
II-A-2
|
40431R
AC9
|
|
|
II-A-3
|
40431R
AD7
|
|
|
II-A-4
|
40431R
AE5
|
|
|
M-1
|
40431R
AF2
|
|
|
M-2
|
40431R
AG0
|
|
|
M-3
|
40431R
AH8
|
|
|
M-4
|
40▇▇▇▇
▇▇▇
|
|
|
M-5
|
40431R
AK1
|
|
|
M-6
|
40431R
AL▇
|
|
|
▇-▇
|
▇0431R
AM▇
|
|
|
▇-▇
|
▇0431R
AN5
|
|
|
M-9
|
40431R
AP0
|
|
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M-10
|
40431R
AQ8
|
|
|
ISIN:
|
||
|
I-▇
|
▇▇▇▇▇▇▇▇▇▇▇▇
|
|
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▇▇-▇-▇
|
▇▇▇▇▇▇▇▇▇▇▇▇
|
|
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▇▇-▇-▇
|
▇▇▇▇▇▇▇▇▇▇▇▇
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|
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II-▇-▇
|
▇▇▇▇▇▇▇▇▇▇▇▇
|
|
|
▇▇-▇-▇
|
▇▇▇▇▇▇▇▇▇▇▇▇
|
|
|
M-1
|
US40431RAF29
|
|
|
M-2
|
US40431RAG02
|
|
|
M-3
|
US40431RAH84
|
|
|
M-4
|
US40431RAJ41
|
EX▇-▇-▇
|
▇-▇
|
▇▇▇▇▇▇▇▇▇▇▇▇
|
|
|
▇-▇
|
▇▇▇▇▇▇▇▇▇▇▇▇
|
|
|
M-7
|
US40431RAM79
|
|
|
M-8
|
US40431RAN52
|
|
|
M-9
|
US40431RAP01
|
|
|
M-10
|
US40431RAQ83
|
EXH-A-5
HSI
ASSET
SECURITIZATION CORPORATION
HSI
Asset
Securitization Corporation Trust 2007-WF1\
Mortgage
Pass-Through Certificates, Series 2007-WF1
[Class
[A[-__][Class M-__]
evidencing
a percentage interest in the distributions allocable to the Certificates
of the
above-referenced Class.
Principal
in respect of this Certificate is distributable monthly as set forth herein.
Accordingly, the Certificate Balance at any time may be less than the
Certificate Balance as set forth herein. This Certificate does not evidence
an
obligation of, or an interest in, and is not guaranteed by the Depositor,
the
Trustee or any other party to the Agreement referred to below or any of
their
respective affiliates. Neither this Certificate nor the Mortgage Loans
are
guaranteed or insured by any governmental agency or
instrumentality.
This
certifies that [____________]is the registered owner of the Percentage
Interest
evidenced by this Certificate (obtained by dividing the denomination of
this
Certificate by the aggregate of the denominations of all Certificates of
the
Class to which this Certificate belongs) in certain monthly distributions
of
principal and interest pursuant to a Pooling and Servicing Agreement dated
as of
the Cut-off Date specified above (the “Agreement”)
among
HSI Asset Securitization Corporation, as depositor (the “Depositor”),
▇▇▇▇▇
Fargo Bank, N.A., as originator, as servicer, master servicer, (in such
capacity, the “Master
Servicer”)
securities administrator (in such capacity, the “Securities
Administrator”)
and
custodian, OfficeTiger Global Real Estate Services Inc., as credit risk
manager,
and Deutsche Bank National Trust Company, as trustee (the “Trustee”).
To
the extent not defined herein, the capitalized terms used herein have the
meanings assigned 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 the acceptance hereof
assents and by which such Holder is bound.
Reference
is hereby made to the further provisions of this Certificate set forth
on the
reverse hereof, which further provisions shall for all purposes have the
same
effect as if set forth at this place.
This
Certificate shall not be entitled to any benefit under the Agreement or
be valid
for any purpose unless manually authenticated by an authorized signatory
of the
Securities Administrator.
* * *
IN
WITNESS WHEREOF, the Securities Administrator has caused this Certificate
to be
duly executed.
|
Dated:
|
EXH-A-6
▇▇▇▇▇
FARGO BANK, N.A.,
not
in
its individual capacity, but solely as
Securities
Administrator
By:
Authenticated:
By:
Authorized
Signatory of
▇▇▇▇▇
FARGO BANK, N.A.,
not
in
its individual capacity,
but
solely as Securities Administrator
EXH-A-7
HSI
ASSET
SECURITIZATION CORPORATION
HSI
Asset
Securitization Corporation Trust 2007-WF1
Mortgage
Pass-Through Certificates
This
Certificate is one of a duly authorized issue of Certificates designated
as HSI
Asset Securitization Corporation Trust 2007-WF1 Mortgage Pass-Through
Certificates, of the Series specified on the face hereof (herein collectively
called the “Certificates”),
and
representing a beneficial ownership interest in the Trust Fund created
by the
Agreement.
The
Certificateholder, by its acceptance of this Certificate, agrees that it
will
look solely
to the
funds on deposit in the Distribution Account or Supplemental Interest Trust
Account for payment hereunder and that neither the Trustee nor the Securities
Administrator is 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 thereby, and the rights, duties and immunities
of the Trustee.
Pursuant
to the terms of the Agreement, a distribution will be made on the 25th
day of
each month or, if such day is not a Business Day, the Business Day immediately
following (the “Distribution
Date”),
commencing on the first Distribution Date specified on the face hereof,
to the
Person in whose name this Certificate is registered at the close of business
on
the applicable Record Date in an amount equal to the product of the Percentage
Interest evidenced by this Certificate and the amount required to be distributed
to Holders of Certificates of the Class to which this Certificate belongs
on
such Distribution Date pursuant to the Agreement. The Record Date applicable
to
each Distribution Date is the Business Day immediately preceding such
Distribution Date.
Distributions
on this Certificate shall be made by wire transfer of immediately available
funds to the account of the Holder hereof at a bank or other entity having
appropriate facilities therefor, if such Certificateholder shall have so
notified the Securities Administrator in writing at least five Business
Days
prior to the related Record Date and such Certificateholder shall satisfy
the
conditions to receive such form of payment set forth in the Agreement,
or, if
not, by check mailed by first class mail to the address of such
Certificateholder appearing in the Certificate Register. The final distribution
on each Certificate will be made in like manner, but only upon presentment
and
surrender of such Certificate at the offices designated by the Securities
Administrator for such purposes or such other location specified in the
notice
to Certificateholders of such final distribution.
The
Agreement permits, with certain exceptions therein provided, the amendment
thereof and the modification of the rights and obligations of the Trustee
and
the rights of the Certificateholders under the Agreement at any time by
the
parties to the Agreement with the consent of the Holders of Certificates
affected by such amendment evidencing the requisite Percentage Interest,
as
provided in the Agreement. 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
exchange therefor 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.
EXH-A-8
As
provided in the Agreement and subject to certain limitations therein set
forth,
the transfer of this Certificate is registrable in the Certificate Register
of
the Securities Administrator upon surrender of this Certificate for registration
of transfer at the offices designated by the Securities Administrator for
such
purposes, 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 of the same Class in authorized denominations and evidencing
the
same aggregate Percentage Interest in the Trust Fund will be issued to
the
designated transferee or transferees.
The
Certificates are issuable only as registered Certificates without coupons
in
denominations specified in the Agreement. As provided in the Agreement
and
subject to certain limitations therein set forth, Certificates are exchangeable
for new Certificates of the same Class in authorized denominations and
evidencing the same aggregate Percentage Interest, as requested by the
Holder
surrendering the same.
No
service charge will be made for any such registration of transfer or exchange,
but the Securities Administrator may require payment of a sum sufficient
to
cover any tax or other governmental charge payable in connection
therewith.
The
Trustee, the Depositor and the Securities Administrator and any agent of
the
Trustee, the Depositor or the Securities Administrator may treat the Person
in
whose name this Certificate is registered as the owner hereof for all purposes,
and neither the Trustee, the Depositor, the Securities Administrator nor
any
such agent shall be affected by any notice to the contrary.
The
Master Servicer shall have the option to purchase the Mortgage Loans and
therefore cause the termination of the Trust on any Optional Termination
Date,
which is any Distribution Date in which the aggregate Stated Principal
Balance
of the Mortgage Loans as of the last day of the related Due Period is less
than
or equal to 10% of the aggregate Stated Principal Balance of the Mortgage
Loans
as of the Cut-off Date.
The
obligations and responsibilities created by the Agreement will terminate
as
provided in Section 11.01 of the Agreement.
Any
term
used herein that is defined in the Agreement shall have the meaning assigned
in
the Agreement, and nothing herein shall be deemed inconsistent with that
meaning.
EXH-A-9
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)
the
Percentage Interest evidenced by the within Certificate and hereby authorizes
the transfer of registration of such Percentage Interest to assignee on
the
Certificate Register of the Trust Fund.
I
(We)
further direct the Securities Administrator 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
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 ,
the
assignee named above, or ,
as
its
agent.
EXH-A-10
EXHIBIT
B
NEITHER
THIS CERTIFICATE NOR ANY INTEREST HEREIN MAY BE TRANSFERRED UNLESS THE
PROPOSED
TRANSFEROR DELIVERS TO THE SECURITIES ADMINISTRATOR A TRANSFEROR LETTER
IN THE
FORM OF EXHIBIT H TO THE AGREEMENT REFERRED TO HEREIN AND EITHER
(I) THE SECURITIES ADMINISTRATOR RECEIVES EITHER A RULE 144A INVESTMENT
LETTER OR REGULATION S INVESTMENT LETTER IN THE FORM OF EXHIBIT I-A AND
EXHIBIT I-B, RESPECTIVELY, TO THE AGREEMENT REFERRED TO HEREIN OR (II) THE
SECURITIES ADMINISTRATOR RECEIVES AN OPINION OF COUNSEL, DELIVERED AT THE
EXPENSE OF THE TRANSFEROR, STATING THAT SUCH TRANSFER MAY BE MADE WITHOUT
REGISTRATION UNDER THE SECURITIES ACT OF 1933, AS AMENDED.
NEITHER
THIS CERTIFICATE NOR ANY INTEREST HEREIN MAY BE TRANSFERRED UNLESS THE
TRANSFEREE DELIVERS TO THE SECURITIES ADMINISTRATOR A REPRESENTATION LETTER
TO
THE EFFECT THAT SUCH TRANSFEREE IS NOT AN EMPLOYEE BENEFIT PLAN SUBJECT
TO
TITLE I OF THE EMPLOYEE RETIREMENT INCOME SECURITY ACT OF 1974, AS AMENDED
(“ERISA”),
OR A
PLAN SUBJECT TO SECTION 4975 OF THE CODE OR A PLAN SUBJECT TO MATERIALLY
SIMILAR PROVISIONS OF APPLICABLE FEDERAL, STATE OR LOCAL LAW (“SIMILAR
LAW”)
OR A
PERSON INVESTING ON BEHALF OF OR WITH PLAN ASSETS OF SUCH A PLAN. IN THE
EVENT
THAT SUCH REPRESENTATION IS VIOLATED, OR ANY ATTEMPT IS MADE TO TRANSFER
TO A
PLAN OR ARRANGEMENT SUBJECT TO SECTION 406 OF ERISA, A PLAN SUBJECT TO
SECTION 4975 OF THE CODE OR A PLAN SUBJECT TO SIMILAR LAW, OR A PERSON
ACTING ON BEHALF OF ANY SUCH PLAN OR ARRANGEMENT OR USING THE ASSETS OF
ANY SUCH
PLAN OR ARRANGEMENT, SUCH ATTEMPTED TRANSFER OR ACQUISITION SHALL BE VOID
AND OF
NO EFFECT.
|
Certificate
No.
|
:
|
P-1
|
|
Cut-off
Date
|
:
|
June
1, 2007
|
|
First
Distribution Date
|
:
|
July
25, 2007
|
|
Percentage
Interest of this Certificate
|
:
|
100%
|
|
Interest
|
:
|
None
|
|
CUSIP
|
:
|
40431R
AR6
|
|
ISIN
|
:
|
US40431RAR66
|
EXH-B-1
HSI
ASSET
SECURITIZATION CORPORATION
HSI
Asset
Securitization Corporation Trust 2007-WF1
Mortgage
Pass-Through Certificates, Series 2007-WF1
Class
P
evidencing
a percentage interest in the distribution of Prepayment Charges allocable
to the
Certificates of the above-referenced Class.
Distributions
in respect of this Certificate are distributable monthly as set forth herein.
This Certificate does not evidence an obligation of, or an interest in,
and is
not guaranteed by the Depositor, the Trustee or any other party to the
Agreement
referred to below or any of their respective affiliates. Neither this
Certificate nor the Mortgage Loans are guaranteed or insured by any governmental
agency or instrumentality.
This
certifies that [________] is the registered owner of the Percentage Interest
evidenced by this Certificate in certain monthly distributions of Prepayment
Charges pursuant to a Pooling and Servicing Agreement dated as of the Cut-off
Date specified above (the “Agreement”)
among
HSI Asset Securitization Corporation, as depositor (the “Depositor”),
▇▇▇▇▇
Fargo Bank, N.A., as originator, as servicer, master servicer, (in such
capacity, the “Master
Servicer”)
securities administrator (in such capacity, the “Securities
Administrator”)
and
custodian, OfficeTiger Global Real Estate Services Inc., as credit risk
manager,
and Deutsche Bank National Trust Company, as trustee (the “Trustee”).
To
the extent not defined herein, the capitalized terms used herein have the
meanings assigned 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 the acceptance hereof
assents and by which such Holder is bound.
This
Certificate does not have an Interest Rate and will solely be entitled
to
receive distributions of Prepayment Charges to the extent set forth in
the
Agreement. In addition, any distribution of the proceeds of any remaining
assets
of the Trust will be made only upon presentment and surrender of this
Certificate at the offices designated by the Securities Administrator for
such
purpose, or such other location specified in the notice to
Certificateholders.
No
transfer of a Certificate of this Class shall be made unless such disposition
is
exempt from the registration requirements of the Securities Act of 1933,
as
amended (the “1933 Act”),
and
any applicable state securities laws or is made in accordance with the
1933 Act
and such laws. In the event of any such transfer, the Securities Administrator
shall require the transferor to execute a transferor certificate (in
substantially the form attached to the Agreement) and deliver either (i) a
Rule 144A Investment Letter or a Regulation S Investment Letter, as
applicable, in either case substantially in the form attached as Exhibit
I-A and
Exhibit I-B, respectively, to the Agreement, or (ii) a written Opinion of
Counsel to the Securities Administrator that such transfer may be made
pursuant
to an exemption, describing the applicable exemption and the basis therefor,
from the 1933 Act or is being made pursuant to the 1933 Act, which Opinion
of
Counsel shall be an expense of the transferor.
EXH-B-2
No
transfer of a Certificate of this Class shall be made unless the Securities
Administrator shall have received a representation letter 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, Section 4975 of the Code
or any materially similar provisions of applicable federal, state or local
law
(“Similar
Law”),
or a
person acting on behalf of or investing plan assets of any such plan, which
representation letter shall not be an expense of the Securities
Administrator.
Reference
is hereby made to the further provisions of this Certificate set forth
on the
reverse hereof, which further provisions shall for all purposes have the
same
effect as if set forth at this place.
This
Certificate shall not be entitled to any benefit under the Agreement or
be valid
for any purpose unless manually authenticated by an authorized signatory
of the
Securities Administrator.
* * *
EXH-B-3
IN
WITNESS WHEREOF, the Securities Administrator has caused this Certificate
to be
duly executed.
|
Dated:
|
▇▇▇▇▇
FARGO BANK, N.A.,
not
in
its individual capacity, but solely as
Securities
Administrator
By:
Authenticated:
By:
Authorized
Signatory of
▇▇▇▇▇
FARGO BANK, N.A.,
not
in
its individual capacity,
but
solely as Securities Administrator
EXH-B-4
HSI
ASSET
SECURITIZATION CORPORATION
HSI
Asset
Securitization Corporation Trust 2007-WF1
Mortgage
Pass-Through Certificates
This
Certificate is one of a duly authorized issue of Certificates designated
as HSI
Asset Securitization Corporation Trust 2007-WF1 Mortgage Pass-Through
Certificates, of the Series specified on the face hereof (herein collectively
called the “Certificates”),
and
representing a beneficial ownership interest in the Trust Fund created
by the
Agreement.
The
Certificateholder, by its acceptance of this Certificate, agrees that it
will
look solely
to the
funds on deposit in the Distribution Account or constituting Prepayment
Charges
for payment hereunder and that neither the Trustee nor the Securities
Administrator is 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 thereby, and the rights, duties and immunities
of the Trustee.
Pursuant
to the terms of the Agreement, a distribution will be made on the 25th
day of
each month or, if such day is not a Business Day, the Business Day immediately
following (the “Distribution
Date”),
commencing on the first Distribution Date specified on the face hereof,
to the
Person in whose name this Certificate is registered at the close of business
on
the applicable Record Date in an amount equal to the product of the Percentage
Interest evidenced by this Certificate and the amount required to be distributed
to Holders of Certificates of the Class to which this Certificate belongs
on
such Distribution Date pursuant to the Agreement. The Record Date applicable
to
each Distribution Date is the last Business Day of the month next preceding
the
month of such Distribution Date.
Distributions
on this Certificate shall be made by wire transfer of immediately available
funds to the account of the Holder hereof at a bank or other entity having
appropriate facilities therefor, if such Certificateholder shall have so
notified the Securities Administrator in writing at least five Business
Days
prior to the related Record Date and such Certificateholder shall satisfy
the
conditions to receive such form of payment set forth in the Agreement,
or, if
not, by check mailed by first class mail to the address of such
Certificateholder appearing in the Certificate Register. The final distribution
on each Certificate will be made in like manner, but only upon presentment
and
surrender of such Certificate at the offices designated by the Securities
Administrator for such purposes or such other location specified in the
notice
to Certificateholders of such final distribution.
The
Agreement permits, with certain exceptions therein provided, the amendment
thereof and the modification of the rights and obligations of the Trustee
and
the rights of the Certificateholders under the Agreement at any time by
the
parties to the Agreement with the consent of the Holders of Certificates
affected by such amendment evidencing the requisite Percentage Interest,
as
provided in the Agreement. 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
exchange therefor 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.
EXH-B-5
As
provided in the Agreement and subject to certain limitations therein set
forth,
the transfer of this Certificate is registrable in the Certificate Register
of
the Securities Administrator upon surrender of this Certificate for registration
of transfer at the offices designated by the Securities Administrator for
such
purposes, 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 of the same Class in authorized denominations and evidencing
the
same aggregate Percentage Interest in the Trust Fund will be issued to
the
designated transferee or transferees.
The
Certificates are issuable only as registered Certificates without coupons
in
denominations specified in the Agreement. As provided in the Agreement
and
subject to certain limitations therein set forth, Certificates are exchangeable
for new Certificates of the same Class in authorized denominations and
evidencing the same aggregate Percentage Interest, as requested by the
Holder
surrendering the same.
No
service charge will be made for any such registration of transfer or exchange,
but the Securities Administrator may require payment of a sum sufficient
to
cover any tax or other governmental charge payable in connection
therewith.
The
Trustee, the Depositor and the Securities Administrator and any agent of
the
Trustee, the Depositor or the Securities Administrator may treat the Person
in
whose name this Certificate is registered as the owner hereof for all purposes,
and neither the Trustee, the Depositor, the Securities Administrator nor
any
such agent shall be affected by any notice to the contrary.
The
Master Servicer shall have the option to purchase the Mortgage Loans and
therefore cause the termination of the Trust on any Optional Termination
Date,
which is any Distribution Date in which the aggregate Stated Principal
Balance
of the Mortgage Loans as of the last day of the related Due Period is less
than
or equal to 10% of the aggregate Stated Principal Balance of the Mortgage
Loans
as of the Cut-off Date.
The
obligations and responsibilities created by the Agreement will terminate
as
provided in Section 11.01 of the Agreement.
Any
term
used herein that is defined in the Agreement shall have the meaning assigned
in
the Agreement, and nothing herein shall be deemed inconsistent with that
meaning.
EXH-B-6
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)
the
Percentage Interest evidenced by the within Certificate and hereby authorizes
the transfer of registration of such Percentage Interest to assignee
on the
Certificate Register of the Trust Fund.
I
(We)
further direct the Securities Administrator 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
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 ,
the
assignee named above, or ,
as
its
agent.
EXH-B-7
EXHIBIT
C
SOLELY
FOR U.S. FEDERAL INCOME TAX PURPOSES, THIS CERTIFICATE IS A “RESIDUAL INTEREST”
IN ONE OR MORE “REAL ESTATE MORTGAGE INVESTMENT CONDUITS,” AS THOSE TERMS ARE
DEFINED, RESPECTIVELY, IN SECTIONS 860G AND 860D OF THE INTERNAL REVENUE
CODE OF
1986, AS AMENDED (THE “CODE”).
NEITHER
THIS CERTIFICATE NOR ANY INTEREST HEREIN MAY BE TRANSFERRED UNLESS THE
PROPOSED
TRANSFEREE DELIVERS TO THE SECURITIES ADMINISTRATOR A TRANSFER AFFIDAVIT
IN
ACCORDANCE WITH THE PROVISIONS OF THE AGREEMENT REFERRED TO HEREIN.
NEITHER
THIS CERTIFICATE NOR ANY INTEREST HEREIN MAY BE TRANSFERRED (I) TO A PERSON
OTHER THAN A PERMITTED TRANSFEREE IN COMPLIANCE WITH SECTION 5.02I OF THE
AGREEMENT OR (II) UNLESS THE TRANSFEREE DELIVERS TO THE SECURITIES
ADMINISTRATOR A REPRESENTATION LETTER TO THE EFFECT THAT SUCH TRANSFEREE
IS NOT
AN EMPLOYEE BENEFIT PLAN SUBJECT TO TITLE I OF THE EMPLOYEE RETIREMENT
INCOME
SECURITY ACT OF 1974, AS AMENDED (“ERISA”),
OR A
PLAN SUBJECT TO SECTION 4975 OF THE CODE OR A PLAN SUBJECT TO MATERIALLY
SIMILAR PROVISIONS OF APPLICABLE FEDERAL, STATE OR LOCAL LAW (“SIMILAR
LAW”)
OR A
PERSON INVESTING ON BEHALF OF OR WITH PLAN ASSETS OF SUCH A PLAN. IN THE
EVENT
THAT SUCH REPRESENTATION IS VIOLATED, OR ANY ATTEMPT IS MADE TO TRANSFER
TO A
PLAN OR ARRANGEMENT SUBJECT TO SECTION 406 OF ERISA, A PLAN SUBJECT TO
SECTION 4975 OF THE CODE OR A PLAN SUBJECT TO SIMILAR LAW, OR A PERSON
ACTING ON BEHALF OF ANY SUCH PLAN OR ARRANGEMENT OR USING THE ASSETS OF
ANY SUCH
PLAN OR ARRANGEMENT, SUCH ATTEMPTED TRANSFER OR ACQUISITION SHALL BE VOID
AND OF
NO EFFECT.
|
Certificate
No.
|
:
|
R-1
|
|
Cut-off
Date
|
:
|
June
1, 2007
|
|
First
Distribution Date
|
:
|
July
25, 2007
|
|
Percentage
Interest of this Certificate
|
:
|
100.00%
|
|
Interest
Rate
|
:
|
None
|
|
CUSIP
|
:
|
40431R
AT2
|
|
ISN
|
:
|
US40431RAT23
|
EXH-C-1
HSI
ASSET
SECURITIZATION CORPORATION
HSI
Asset
Securitization Corporation Trust 2007-WF1
Mortgage
Pass-Through Certificates, Series 2007-WF1
Class
R
evidencing
a percentage interest in the distributions allocable to the Certificates
of the
above-referenced Class.
Distributions
in respect of this Certificate are distributable monthly as set forth herein.
This Class R Certificate has no Certificate Balance and is not entitled to
distributions in respect of principal or interest. This Certificate does
not
evidence an obligation of, or an interest in, and is not guaranteed by
the
Depositor, the Trustee or any other party to the Agreement referred to
below or
any of their respective affiliates. Neither this Certificate nor the Mortgage
Loans are guaranteed or insured by any governmental agency or
instrumentality.
This
certifies that [HSBC SECURITIES (USA) INC.] is the registered owner of
the
Percentage Interest specified above of any monthly distributions due to
the
Class R Certificates pursuant to a Pooling and Servicing Agreement dated as
of the Cut-off Date specified above (the “Agreement”)
among
HSI Asset Securitization Corporation, as depositor (the “Depositor”),
▇▇▇▇▇
Fargo Bank, N.A., as originator, as servicer, master servicer, (in such
capacity, the “Master
Servicer”)
securities administrator (in such capacity, the “Securities
Administrator”)
and
custodian, OfficeTiger Global Real Estate Services Inc., as credit risk
manager,
and Deutsche Bank National Trust Company, as trustee (the “Trustee”).
To
the extent not defined herein, the capitalized terms used herein have the
meanings assigned 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 the acceptance hereof
assents and by which such Holder is bound.
Any
distribution of the proceeds of any remaining assets of the Trust will
be made
only upon presentment and surrender of this Class R Certificate at the
offices designated by the Securities Administrator for such purpose, or
such
other location specified in the notice to Certificateholders.
No
transfer of a Class R Certificate shall be made unless the Securities
Administrator shall have received a representation letter 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 or arrangement subject to Section 406 of ERISA, a plan or
arrangement subject to Section 4975 of the Code or a plan subject to
Similar Law, or a person acting on behalf of any such plan or arrangement
nor
using the assets of any such plan or arrangement to effect such transfer,
which
representation letter shall not be an expense of the Trustee, the Securities
Administrator, the Depositor, the Master Servicer or the Trust Fund. In
the
event that such representation is violated, or any attempt is made to transfer
to a plan or arrangement subject to Section 406 of ERISA or a plan subject
to Section 4975 of the Code or a plan subject to Similar Law, or a person
acting on behalf of any such plan or arrangement or using the assets of
any such
plan or arrangement, such attempted transfer or acquisition shall be void
and of
no effect.
EXH-C-2
Each
Holder of this Class R Certificate shall be deemed by the acceptance or
acquisition an Ownership Interest in this Class R Certificate to have
agreed to be bound by the following provisions, and the rights of each
Person
acquiring any Ownership Interest in this Class R Certificate are expressly
subject to the following provisions: (i) each Person holding or acquiring
any Ownership Interest in this Class R 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, (ii) no
Ownership Interest in this Class R Certificate may be registered on the
Closing Date or thereafter transferred, and the Securities Administrator
shall
not register the Transfer of this Certificate unless, in addition to the
certificates required to be delivered to the Securities Administrator under
Section 5.02(b) of the Agreement, the Securities Administrator shall have
been furnished with a Transfer Affidavit of the initial owner or the proposed
transferee in the form attached as Exhibit G to the Agreement,
(iii) each Person holding or acquiring any Ownership Interest in this
Class R Certificate shall agree (A) to obtain a Transfer Affidavit
from any other Person to whom such Person attempts to Transfer its Ownership
Interest this Class R Certificate, (B) to obtain a Transfer Affidavit
from any Person for whom such Person is acting as nominee, trustee or agent
in
connection with any Transfer of this Class R Certificate, (C) not to
cause income with respect to the Class R Certificate to be attributable to
a foreign permanent establishment or fixed base, within the meaning of
an
applicable income tax treaty, of such Person or any other U.S. Person and
(D) not to Transfer the Ownership Interest in this Class R Certificate
or to cause the Transfer of the Ownership Interest in this Class R
Certificate to any other Person if it has actual knowledge that such Person
is a
Non-Permitted Transferee and (iv) any attempted or purported Transfer of
the Ownership Interest in this Class R Certificate in violation of the
provisions herein shall be absolutely null and void and shall vest no rights
in
the purported Transferee.
Reference
is hereby made to the further provisions of this Certificate set forth
on the
reverse hereof, which further provisions shall for all purposes have the
same
effect as if set forth at this place.
This
Certificate shall not be entitled to any benefit under the Agreement or
be valid
for any purpose unless manually authenticated by an authorized signatory
of the
Securities Administrator.
* * *
EXH-C-3
IN
WITNESS WHEREOF, the Securities Administrator has caused this Certificate
to be
duly executed.
|
Dated:
|
▇▇▇▇▇
FARGO BANK, N.A.,
not
in
its individual capacity, but solely as
Securities
Administrator
By:
Authenticated:
By:
Authorized
Signatory of
▇▇▇▇▇
FARGO BANK, N.A.,
not
in
its individual capacity,
but
solely as Securities Administrator
EXH-C-4
HSI
ASSET
SECURITIZATION CORPORATION
HSI
Asset
Securitization Corporation Trust 2007-WF1
Mortgage
Pass-Through Certificates
This
Certificate is one of a duly authorized issue of Certificates designated
as HSI
Asset Securitization Corporation Trust 2007-WF1 Mortgage Pass-Through
Certificates, of the Series specified on the face hereof (herein collectively
called the “Certificates”),
and
representing a beneficial ownership interest in the Trust Fund created
by the
Agreement.
The
Certificateholder, by its acceptance of this Certificate, agrees that it
will
look solely
to the
funds on deposit in the Distribution Account or Supplemental Interest Trust
Account for payment hereunder and that neither the Trustee nor the Securities
Administrator is 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 thereby, and the rights, duties and immunities
of the Trustee.
Pursuant
to the terms of the Agreement, a distribution will be made on the 25th
day of
each month or, if such day is not a Business Day, the Business Day immediately
following (the “Distribution
Date”),
commencing on the first Distribution Date specified on the face hereof,
to the
Person in whose name this Certificate is registered at the close of business
on
the applicable Record Date in an amount equal to the product of the Percentage
Interest evidenced by this Certificate and the amount required to be distributed
to Holders of Certificates of the Class to which this Certificate belongs
on
such Distribution Date pursuant to the Agreement. The Record Date applicable
to
each Distribution Date is the last Business Day of the month next preceding
the
month of such Distribution Date.
Distributions
on this Certificate shall be made by wire transfer of immediately available
funds to the account of the Holder hereof at a bank or other entity having
appropriate facilities therefor, if such Certificateholder shall have so
notified the Securities Administrator in writing at least five Business
Days
prior to the related Record Date and such Certificateholder shall satisfy
the
conditions to receive such form of payment set forth in the Agreement,
or, if
not, by check mailed by first class mail to the address of such
Certificateholder appearing in the Certificate Register. The final distribution
on each Certificate will be made in like manner, but only upon presentment
and
surrender of such Certificate at the offices designated by the Securities
Administrator for such purpose, or such other location specified in the
notice
to Certificateholders of such final distribution.
The
Agreement permits, with certain exceptions therein provided, the amendment
thereof and the modification of the rights and obligations of the Trustee
and
the rights of the Certificateholders under the Agreement at any time by
the
parties to the Agreement with the consent of the Holders of Certificates
affected by such amendment evidencing the requisite Percentage Interest,
as
provided in the Agreement. 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
exchange therefor 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.
EXH-C-5
As
provided in the Agreement and subject to certain limitations therein set
forth,
the transfer of this Certificate is registrable in the Certificate Register
of
the Securities Administrator upon surrender of this Certificate for registration
of transfer at the offices designated by the Securities Administrator for
such
purposes, 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 of the same Class in authorized denominations and evidencing
the
same aggregate Percentage Interest in the Trust Fund will be issued to
the
designated transferee or transferees.
The
Certificates are issuable only as registered Certificates without coupons
in
denominations specified in the Agreement. As provided in the Agreement
and
subject to certain limitations therein set forth, Certificates are exchangeable
for new Certificates of the same Class in authorized denominations and
evidencing the same aggregate Percentage Interest, as requested by the
Holder
surrendering the same.
No
service charge will be made for any such registration of transfer or exchange,
but the Securities Administrator may require payment of a sum sufficient
to
cover any tax or other governmental charge payable in connection
therewith.
The
Trustee, the Depositor and the Securities Administrator and any agent of
the
Trustee, the Depositor or the Securities Administrator may treat the Person
in
whose name this Certificate is registered as the owner hereof for all purposes,
and neither the Trustee, the Depositor, the Securities Administrator nor
any
such agent shall be affected by any notice to the contrary.
The
Master Servicer shall have the option to purchase the Mortgage Loans and
therefore cause the termination of the Trust on any Optional Termination
Date,
which is any Distribution Date in which the aggregate Stated Principal
Balance
of the Mortgage Loans as of the last day of the related Due Period is less
than
or equal to 10% of the aggregate Stated Principal Balance of the Mortgage
Loans
as of the Cut-off Date.
The
obligations and responsibilities created by the Agreement will terminate
as
provided in Section 11.01 of the Agreement.
Any
term
used herein that is defined in the Agreement shall have the meaning assigned
in
the Agreement, and nothing herein shall be deemed inconsistent with that
meaning.
EXH-C-6
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)
the
Percentage Interest evidenced by the within Certificate and hereby authorizes
the transfer of registration of such Percentage Interest to assignee
on the
Certificate Register of the Trust Fund.
I
(We)
further direct the Securities Administrator 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
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 ,
the
assignee named above, or ,
as
its
agent.
EXH-C-7
EXHIBIT
D
SOLELY
FOR U.S. FEDERAL INCOME TAX PURPOSES, THIS CERTIFICATE REPRESENTS AN INTEREST
IN
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, AS AMENDED (THE “CODE”)
AND
CERTAIN OTHER ASSETS.
NEITHER
THIS CERTIFICATE NOR ANY INTEREST HEREIN MAY BE TRANSFERRED UNLESS THE
PROPOSED
TRANSFEROR DELIVERS TO THE SECURITIES ADMINISTRATOR A TRANSFEROR LETTER
IN THE
FORM OF EXHIBIT H TO THE AGREEMENT REFERRED TO HEREIN AND EITHER
(I) THE SECURITIES ADMINISTRATOR RECEIVES EITHER A RULE 144A INVESTMENT
LETTER OR A REGULATION S INVESTMENT LETTER IN THE FORM OF EXHIBIT I-A AND
EXHIBIT I-B, RESPECTIVELY, TO THE AGREEMENT REFERRED TO HEREIN OR (II) THE
SECURITIES ADMINISTRATOR RECEIVES AN OPINION OF COUNSEL, DELIVERED AT THE
EXPENSE OF THE TRANSFEROR, THAT SUCH TRANSFER MAY BE MADE WITHOUT REGISTRATION
UNDER THE SECURITIES ACT OF 1933, AS AMENDED.
NEITHER
THIS CERTIFICATE NOR ANY INTEREST HEREIN MAY BE TRANSFERRED UNLESS THE
TRANSFEREE DELIVERS TO THE SECURITIES ADMINISTRATOR A REPRESENTATION LETTER
TO
THE EFFECT THAT SUCH TRANSFEREE IS NOT AN EMPLOYEE BENEFIT PLAN SUBJECT
TO
TITLE I OF THE EMPLOYEE RETIREMENT INCOME SECURITY ACT OF 1974, AS AMENDED
(“ERISA”),
OR A
PLAN SUBJECT TO SECTION 4975 OF THE CODE OR A PLAN SUBJECT TO MATERIALLY
SIMILAR PROVISIONS OF APPLICABLE FEDERAL, STATE OR LOCAL LAW (“SIMILAR
LAW”)
OR A
PERSON INVESTING ON BEHALF OF OR WITH PLAN ASSETS OF SUCH A PLAN. IN THE
EVENT
THAT SUCH REPRESENTATION IS VIOLATED, OR ANY ATTEMPT IS MADE TO TRANSFER
TO A
PLAN OR ARRANGEMENT SUBJECT TO SECTION 406 OF ERISA, A PLAN SUBJECT TO
SECTION 4975 OF THE CODE OR A PLAN SUBJECT TO SIMILAR LAW, OR A PERSON
ACTING ON BEHALF OF ANY SUCH PLAN OR ARRANGEMENT OR USING THE ASSETS OF
ANY SUCH
PLAN OR ARRANGEMENT, SUCH ATTEMPTED TRANSFER OR ACQUISITION SHALL BE VOID
AND OF
NO EFFECT.
|
Certificate
No.
|
:
|
X-1
|
|
Cut-off
Date
|
:
|
June
1, 2007
|
|
First
Distribution Date
|
:
|
July
25, 2007
|
|
Percentage
Interest of this Certificate
|
:
|
100%
|
|
Interest
Rate
|
:
|
None
|
|
CUSIP
|
:
|
40431R
AS4
|
|
ISIN
|
:
|
US▇▇▇▇▇▇▇▇▇▇
|
▇▇▇-▇-▇
HSI
ASSET
SECURITIZATION CORPORATION
HSI
Asset
Securitization Corporation Trust 2007-WF1
Mortgage
Pass-Through Certificates, Series 2007-WF1
Class
X
evidencing
a percentage interest in the distributions allocable to the Certificates
of the
above-referenced Class.
Distributions
in respect of this Certificate are distributable monthly as set forth herein.
This Certificate does not evidence an obligation of, or an interest in,
and is
not guaranteed by the Depositor, the Trustee or any other party to the
Agreement
referred to below or any of their respective affiliates. Neither this
Certificate nor the Mortgage Loans are guaranteed or insured by any governmental
agency or instrumentality.
This
certifies that [____________________] is the registered owner of the Percentage
Interest evidenced by this Certificate (obtained by dividing the denomination
of
this Certificate by the aggregate of the denominations of all Certificates
of
the Class to which this Certificate belongs) in certain monthly distributions
pursuant to a Pooling and Servicing Agreement dated as of the Cut-off Date
specified above (the “Agreement”)
among
HSI Asset Securitization Corporation, as depositor (the “Depositor”),
▇▇▇▇▇
Fargo Bank, N.A., as originator, as servicer, master servicer, (in such
capacity, the “Master
Servicer”)
securities administrator (in such capacity, the “Securities
Administrator”)
and
custodian, OfficeTiger Global Real Estate Services Inc., as credit risk
manager,
and Deutsche Bank National Trust Company, as trustee (the “Trustee”).
To
the extent not defined herein, the capitalized terms used herein have the
meanings assigned 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 the acceptance hereof
assents and by which such Holder is bound.
This
Certificate does not have a Certificate Balance or an Interest Rate and
will be
entitled to distributions only to the extent set forth in the Agreement.
In
addition, any distribution of the proceeds of any remaining assets of the
Trust
will be made only upon presentment and surrender of this Certificate at
the
offices designated by the Securities Administrator for such purpose, or
such
other location specified in the notice to Certificateholders.
No
transfer of a Certificate of this Class shall be made unless such disposition
is
exempt from the registration requirements of the Securities Act of 1933,
as
amended (the “1933 Act”),
and
any applicable state securities laws or is made in accordance with the
1933 Act
and such laws. In the event of any such transfer, the Securities Administrator
shall require the transferor to execute a transferor certificate (in
substantially the form attached to the Agreement) and deliver either (i) a
Rule 144A Investment Letter or Regulation S Investment Letter, as
applicable, in either case substantially in the form attached to the Agreement,
or (ii) a written Opinion of Counsel to the Securities Administrator that
such transfer may be made pursuant to an exemption, describing the applicable
exemption and the basis therefor, from the 1933 Act or is being made pursuant
to
the 1933 Act, which Opinion of Counsel shall be an expense of the
transferor.
EXH-D-2
No
transfer of a Certificate of this Class shall be made unless the Securities
Administrator shall have received a representation letter 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, Section 4975 of the Code
or any materially similar provisions of applicable federal, state or local
law
(“Similar
Law”),
or a
person acting on behalf of or investing plan assets of any such plan, which
representation letter shall not be an expense of the Securities
Administrator.
Reference
is hereby made to the further provisions of this Certificate set forth
on the
reverse hereof, which further provisions shall for all purposes have the
same
effect as if set forth at this place.
This
Certificate shall not be entitled to any benefit under the Agreement or
be valid
for any purpose unless manually authenticated by an authorized signatory
of the
Securities Administrator.
* * *
EXH-D-3
IN
WITNESS WHEREOF, the Securities Administrator has caused this Certificate
to be
duly executed.
|
Dated:
|
▇▇▇▇▇
FARGO BANK, N.A.,
not
in
its individual capacity, but solely as
Securities
Administrator
By:
Authenticated:
By:
Authorized
Signatory of
▇▇▇▇▇
FARGO BANK, N.A.,
not
in
its individual capacity,
but
solely as Securities Administrator
EXH-D-4
HSI
ASSET
SECURITIZATION CORPORATION
HSI
Asset
Securitization Corporation Trust 2007-WF1
Mortgage
Pass-Through Certificates
This
Certificate is one of a duly authorized issue of Certificates designated
as HSI
Asset Securitization Corporation Trust 2007-WF1 Mortgage Pass-Through
Certificates, of the Series specified on the face hereof (herein collectively
called the “Certificates”),
and
representing a beneficial ownership interest in the Trust Fund created
by the
Agreement.
The
Certificateholder, by its acceptance of this Certificate, agrees that it
will
look solely
to the
funds on deposit in the Distribution Account or Supplemental Interest Trust
Account for payment hereunder and that neither the Trustee nor the Securities
Administrator is 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 thereby, and the rights, duties and immunities
of the Trustee.
Pursuant
to the terms of the Agreement, a distribution will be made on the 25th
day of
each month or, if such 25th day is not a Business Day, the Business Day
immediately following (the “Distribution
Date”),
commencing on the first Distribution Date specified on the face hereof,
to the
Person in whose name this Certificate is registered at the close of business
on
the applicable Record Date in an amount equal to the product of the Percentage
Interest evidenced by this Certificate and the amount required to be distributed
to Holders of Certificates of the Class to which this Certificate belongs
on
such Distribution Date pursuant to the Agreement. The Record Date applicable
to
each Distribution Date is the last Business Day of the month next preceding
the
month of such Distribution Date.
Distributions
on this Certificate shall be made by wire transfer of immediately available
funds to the account of the Holder hereof at a bank or other entity having
appropriate facilities therefor, if such Certificateholder shall have so
notified the Securities Administrator in writing at least five Business
Days
prior to the related Record Date and such Certificateholder shall satisfy
the
conditions to receive such form of payment set forth in the Agreement,
or, if
not, by check mailed by first class mail to the address of such
Certificateholder appearing in the Certificate Register. The final distribution
on each Certificate will be made in like manner, but only upon presentment
and
surrender of such Certificate at the offices designated by the Securities
Administrator for such purposes or such other location specified in the
notice
to Certificateholders of such final distribution.
The
Agreement permits, with certain exceptions therein provided, the amendment
thereof and the modification of the rights and obligations of the Trustee
and
the rights of the Certificateholders under the Agreement at any time by
the
parties to the Agreement with the consent of the Holders of Certificates
affected by such amendment evidencing the requisite Percentage Interest,
as
provided in the Agreement. 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
exchange therefor 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.
EXH-D-5
As
provided in the Agreement and subject to certain limitations therein set
forth,
the transfer of this Certificate is registrable in the Certificate Register
of
the Securities Administrator upon surrender of this Certificate for registration
of transfer at the offices designated by the Securities Administrator for
such
purposes, 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 of the same Class in authorized denominations and evidencing
the
same aggregate Percentage Interest in the Trust Fund will be issued to
the
designated transferee or transferees.
The
Certificates are issuable only as registered Certificates without coupons
in
denominations specified in the Agreement. As provided in the Agreement
and
subject to certain limitations therein set forth, Certificates are exchangeable
for new Certificates of the same Class in authorized denominations and
evidencing the same aggregate Percentage Interest, as requested by the
Holder
surrendering the same.
No
service charge will be made for any such registration of transfer or exchange,
but the Securities Administrator may require payment of a sum sufficient
to
cover any tax or other governmental charge payable in connection
therewith.
The
Trustee, the Depositor and the Securities Administrator and any agent of
the
Trustee, the Depositor or the Securities Administrator may treat the Person
in
whose name this Certificate is registered as the owner hereof for all purposes,
and neither the Trustee, the Depositor, the Securities Administrator nor
any
such agent shall be affected by any notice to the contrary.
The
Master Servicer shall have the option to purchase the Mortgage Loans and
therefore cause the termination of the Trust on any Optional Termination
Date,
which is any Distribution Date in which the aggregate Stated Principal
Balance
of the Mortgage Loans as of the last day of the related Due Period is less
than
or equal to 10% of the aggregate Stated Principal Balance of the Mortgage
Loans
as of the Cut-off Date.
The
obligations and responsibilities created by the Agreement will terminate
as
provided in Section 11.01 of the Agreement.
Any
term
used herein that is defined in the Agreement shall have the meaning assigned
in
the Agreement, and nothing herein shall be deemed inconsistent with that
meaning
EXH-D-6
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)
the
Percentage Interest evidenced by the within Certificate and hereby authorizes
the transfer of registration of such Percentage Interest to assignee
on the
Certificate Register of the Trust Fund.
I
(We)
further direct the Securities Administrator 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
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 ,
the
assignee named above, or ,
as
its
agent.
EXH-D-7
EXHIBIT
E
FORM
OF
INITIAL CERTIFICATION OF CUSTODIAN
[date]
|
HSI
Asset Securitization Corporation
45▇
▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇
▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇
|
▇▇▇▇▇
Fargo Bank, N.A.
1
Home Campus
De▇
▇▇▇▇▇▇, ▇▇▇▇ ▇▇▇▇▇-▇▇▇▇
|
|
▇▇▇▇▇
Fargo Bank, N.A.
9062
Old Annapolis Road
Columbia,
Maryland 21045-1951
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Deutsche
Bank National Trust Company
1761
East St. ▇▇▇▇▇▇ Place
Santa
Ana, California 92705-4934
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Re:
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HSI
Asset Securitization Corporation Trust, Series
2007-WF1
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Ladies
and Gentlemen:
In
accordance with Section 2.02 of the Pooling and Servicing Agreement (the
“Pooling
and Servicing Agreement”)
dated
as of June 1, 2007 among HSI Asset Securitization Corporation, as depositor,
▇▇▇▇▇ Fargo Bank, N.A., as originator, as servicer, master servicer, securities
administrator and custodian, OfficeTiger Global Real Estate Services Inc.,
as
credit risk manager, and Deutsche Bank National Trust Company, as trustee,
for
each Mortgage Loan listed in the Mortgage Loan Schedule (other than any
Mortgage
Loan listed in the attached schedule), it has received:
(i) the
original Mortgage Note, endorsed as provided in the following form: “Pay to the
order of ________, without recourse”; and
(ii) a
duly
executed assignment of the Mortgage (which may be included in a blanket
assignment or assignments).
Based
on
its review and examination and only as to the foregoing documents, such
documents appear regular on their face and related to such Mortgage
Loan.
The
Custodian has made no independent examination of any documents contained
in each
Mortgage File beyond the review specifically required in the Pooling and
Servicing Agreement. The Custodian makes no representations as to: (i) the
validity, legality, sufficiency, enforceability or genuineness of any of
the
documents contained in each Mortgage File of any of the Mortgage Loans
identified on the Mortgage Loan Schedule, or (ii) the collectability,
insurability, effectiveness or suitability of any such Mortgage
Loan.
EXH-E-1
Capitalized
words and phrases used herein shall have the respective meanings assigned
to
them in the Pooling and Servicing Agreement.
▇▇▇▇▇
FARGO BANK, N.A., as Custodian
By:
Name:
Title:
EXH-E-2
EXHIBIT
F
FORM
OF
DOCUMENT CERTIFICATION
AND
EXCEPTION REPORT OF CUSTODIAN
______,
20___
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HSI
Asset Securitization Corporation
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▇▇▇
▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇
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▇▇▇▇▇
Fargo Bank, N.A.
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▇▇▇▇▇▇▇▇,
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Deutsche
Bank National Trust Company
▇▇▇▇
▇▇▇▇ ▇▇. ▇▇▇▇▇▇ ▇▇▇▇▇
▇▇▇▇▇
▇▇▇, ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇-▇▇▇▇
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▇▇▇▇▇
Fargo Bank, N.A.
1
Home Campus
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▇▇▇▇▇▇, ▇▇▇▇ ▇▇▇▇▇-▇▇▇▇
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Re:
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HSI
Asset Securitization Corporation, Series
2007-WF1
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Ladies
and Gentlemen:
In
accordance with Section 2.02 of the Pooling and Servicing Agreement (the
“Pooling
and Servicing Agreement”)
dated
as of June 1, 2007 among HSI Asset Securitization Corporation, as depositor,
▇▇▇▇▇ Fargo Bank, N.A., as originator, as servicer, master servicer, securities
administrator and custodian, OfficeTiger Global Real Estate Services Inc.,
as
credit risk manager, and Deutsche Bank National Trust Company, as trustee,
the
undersigned, as Custodian, hereby certifies that as to each Mortgage Loan
listed
in the Mortgage Loan Schedule (other than any Mortgage Loan paid in full
or
listed on the attached Document Exception Report) it has received:
(i) The
original Mortgage Note, endorsed in the form provided in Section 2.01 of
the Pooling and Servicing Agreement, with all intervening endorsements
showing a
complete chain of endorsement from the originator to the last
endorsee.
(ii) The
original recorded Mortgage.
(iii) A
duly
executed assignment of the Mortgage in the form provided in Section 2.01 of
the Pooling and Servicing Agreement; or, if the Originator has certified
or the
Custodian otherwise knows that the related Mortgage has not been returned
from
the applicable recording office, a copy of the assignment of the Mortgage
(excluding information to be provided by the recording office).
EXH-F-1
(iv) The
original or duplicate original recorded assignment or assignments of the
Mortgage showing a complete chain of assignment from the Originator to
the last
endorsee.
(v) The
original or duplicate original lender’s title policy and all riders thereto or,
any one of an original title binder, an original preliminary title report
or an
original title commitment, or a copy thereof certified by the title
company.
Based
on
its review and examination and only as to the foregoing documents, (a) such
documents appear regular on their face and related to such Mortgage Loan,
and
(b) the information set forth in items (1), (2), (3), (15), (18) and
(22) of the Data Tape Information accurately reflects information set forth
in
the Custodial File.
The
Custodian has made no independent examination of any documents contained
in each
Mortgage File beyond the review of the Custodial File specifically required
in
the Pooling and Servicing Agreement. The Custodian makes no representation
as
to: (i) the validity, legality, sufficiency, enforceability or genuineness
of any of the documents contained in each Mortgage File of any of the Mortgage
Loans identified on the Mortgage Loan Schedule, or (ii) the collectability,
insurability, effectiveness or suitability of any such Mortgage Loan.
Notwithstanding anything herein to the contrary, the Custodian has made
no
determination and makes no representations as to whether (i) any
endorsement is sufficient to transfer all right, title and interest of
the party
so endorsing, as noteholder or assignee thereof, in and to that Mortgage
Note or
(ii) any assignment is in recordable form or sufficient to effect the
assignment of and transfer to the assignee thereof, under the Mortgage
to which
the assignment relates.
Capitalized
words and phrases used herein shall have the respective meanings assigned
to
them in the Pooling and Servicing Agreement.
▇▇▇▇▇
FARGO BANK, N.A., as Custodian
By:
Name:
Title:
EXH-F-2
EXHIBIT
G
FORM
OF
RESIDUAL TRANSFER AFFIDAVIT
HSI
Asset
Securitization Corporation Trust 2007-WF1
Mortgage
Pass-Through Certificates, Series 2007-WF1
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STATE
OF
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)
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) ss.:
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COUNTY
OF
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)
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The
undersigned, being first duly sworn, deposes and says as follows:
1. The
undersigned is an officer of ___________________, the proposed Transferee
of an
Ownership Interest in a Class R Certificate (the “Certificate”)
issued
pursuant to the Pooling and Servicing Agreement (the “Agreement”),
relating to the above-referenced Series, dated as of June 1, 2007 among
HSI
Asset Securitization Corporation, as depositor, ▇▇▇▇▇ Fargo Bank, N.A.,
as
originator, as servicer, master servicer, securities administrator and
custodian, OfficeTiger Global Real Estate Services Inc., as credit risk
manager,
and Deutsche Bank National Trust Company, as trustee. Capitalized terms
used,
but not defined herein, shall have the meanings ascribed to such terms
in the
Agreement. The Transferee has authorized the undersigned to make this affidavit
on behalf of the Transferee for the benefit of the Depositor, the Securities
Administrator and the Trustee.
2. The
Transferee is, as of the date hereof, and will be, as of the date of the
Transfer, a Permitted Transferee. The Transferee is acquiring its Ownership
Interest in the Certificate for its own account. The Transferee has no
knowledge
that any such affidavit is false.
3. The
Transferee has been advised of, and understands that (i) a tax will be
imposed on Transfers of the Certificate to Persons that are Non-Permitted
Transferees; (ii) such tax will be imposed on the transferor, or, if such
Transfer is through an agent (which includes a broker, nominee or middleman)
for
a Person that is a Non-Permitted Transferee, on the agent; and (iii) the
Person otherwise liable for the tax shall be relieved of liability for
the tax
if the subsequent Transferee furnished to such Person an affidavit that
such
subsequent Transferee is a Permitted Transferee and, at the time of Transfer,
such Person does not have actual knowledge that the affidavit is
false.
4. The
Transferee has been advised of, and understands that a tax will be imposed
on a
“pass-through entity” holding the Certificate if at any time during the taxable
year of the pass-through entity a Person that is a Non-Permitted Transferee
is
the record holder of an interest in such entity. The Transferee understands
that
such tax will not be imposed for any period with respect to which the record
holder furnishes to the pass-through entity an affidavit that such record
holder
is a Permitted Transferee and the pass-through entity does not have actual
knowledge that such affidavit is false. (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
and, except as may be provided in Treasury Regulations, persons holding
interests in pass-through entities as a nominee for another
Person.)
EXH-G-1
5. The
Transferee has reviewed the provisions of Section 5.02(c) of the Agreement
and understands the legal consequences of the acquisition of an Ownership
Interest in the Certificate including, without limitation, the restrictions
on
subsequent Transfers and the provisions regarding voiding the Transfer
and
mandatory sales. The Transferee expressly agrees to be bound by and to
abide by
the provisions of Section 5.02(c) of the Agreement and the restrictions
noted on the face of the Certificate. The Transferee understands and agrees
that
any breach of any of the representations included herein shall render the
Transfer to the Transferee contemplated hereby null and void.
6. The
Transferee agrees to require a Transfer Affidavit from any Person to whom
the
Transferee attempts to Transfer its Ownership Interest in the Certificate,
and
in connection with any Transfer by a Person for whom the Transferee is
acting as
nominee, trustee or agent, and the Transferee will not Transfer its Ownership
Interest or cause any Ownership Interest to be Transferred to any Person
that
the Transferee knows is a Non-Permitted Transferee. In connection with
any such
Transfer by the Transferee, the Transferee agrees to deliver to the Securities
Administrator a certificate substantially in the form set forth as
Exhibit H to the Agreement (a “Transferor
Certificate”)
to the
effect that, among other things, such Transferee has no actual knowledge
that
the Person to which the Transfer is to be made is a Non-Permitted
Transferee.
7. The
Transferee does not have the intention to impede the assessment or collection
of
any tax legally required to be paid with respect to the Certificate. The
Transferee has historically paid its debts as they have come due and intends
to
pay its debts as they come due in the future. The Transferee intends to
pay all
taxes due with respect to the Certificate as they become due.
8. The
Transferee’s taxpayer identification number is __________.
9. The
Transferee is not a Disqualified Non-U.S. Person as defined in the
Agreement.
10. The
Transferee is aware that the Certificate may be a “noneconomic residual
interest” within the meaning of proposed Treasury regulations promulgated
pursuant to 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 was to impede the
assessment or collection of tax.
11. The
Transferee will not cause income from the Residual Certificate to be
attributable to a foreign permanent establishment or fixed base, within
the
meaning of an applicable income tax treaty, of the Transferee or any other
U.S.
Person.
EXH-G-2
12. Check
the
applicable paragraph:
o The
present value of the
anticipated tax liabilities associated with holding the Certificate, as
applicable, does not exceed the sum of:
(i) the
present value of any consideration given to the Transferee to acquire such
Certificate;
(ii) the
present value of the expected future distributions on such Certificate;
and
(iii) the
present value of the anticipated tax savings associated with holding such
Certificate as the related REMIC generates losses.
For
purposes of this calculation, (i) the Transferee is assumed to pay tax at
the highest rate currently specified in Section 11(b) of the Code (but the
tax rate in Section 55(b)(1)(B) of the Code may be used in lieu of the
highest
rate specified in Section 11(b) of the Code if the Transferee has been
subject to the alternative minimum tax under Section 55 of the Code in the
preceding two years and will compute its taxable income in the current
taxable
year using the alternative minimum tax rate) and (ii) present values are
computed using a discount rate equal to the short-term Federal rate prescribed
by Section 1274(d) of the Code for the month of the transfer and the
compounding period used by the Transferee.
o The
transfer of the Certificate complies with U.S. Treasury Regulations Sections
1.860E-1(c)(5) and (6) and, accordingly,
(i) the
Transferee is an “eligible corporation,” as defined in U.S. Treasury Regulations
Section 1.860E-1(c)(6)(i), as to which income from the Certificate will
only be
taxed in the United States;
(ii) at
the
time of the transfer, and at the close of the Transferee’s two fiscal years
preceding the year of the transfer, the Transferee had gross assets for
financial reporting purposes (excluding any obligation of a person related
to
the Transferee within the meaning of U.S. Treasury Regulations Section
1.860E-1(c)(6)(ii)) in excess of $100 million and net assets in excess of
$10 million;
(iii) the
Transferee will transfer the Certificate only to another “eligible corporation,”
as defined in U.S. Treasury Regulations Section 1.860E-1(c)(6)(i), in a
transaction that satisfies the requirements of Sections 1.860E-1(c)(4)(i),
(ii)
and (iii) and Section 1.860E-1(c)(5) of the U.S. Treasury Regulations;
and
(iv) the
Transferee determined the consideration paid to it to acquire the Certificate
based on reasonable market assumptions (including, but not limited to,
borrowing
and investment rates, prepayment and loss assumptions, expense and reinvestment
assumptions, tax rates and other factors specific to the Transferee) that
it has
determined in good faith.
o None
of
the above.
EXH-G-3
13. The
Transferee is not an employee benefit plan that is subject to Title I of
ERISA or a plan that is subject to Section 4975 of the Code or a plan
subject to any Federal, state or local law that is substantially similar
to
Title I of ERISA or Section 4975 of the Code, and the Transferee is
not acting on behalf of or investing plan assets of such a plan.
* * *
IN
WITNESS WHEREOF, the Transferee has caused this instrument to be executed
on its
behalf, pursuant to authority of its Board of Directors, by its duly authorized
officer and its corporate seal to be hereunto affixed, duly attested, this
___
day of _______, 20__.
Print
Name of Transferee
By:
Name:
Title:
[Corporate
Seal]
ATTEST:
[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 the ___________
of
the Transferee, and acknowledged that he executed the same as his free
act and
deed and the free act and deed of the Transferee.
Subscribed
and sworn before me this ___ day of _______, 20__.
NOTARY
PUBLIC
My
Commission expires the __ day
of
_________, 20__
EXH-G-4
EXHIBIT
H
FORM
OF
TRANSFEROR CERTIFICATE
__________,
20__
HSI
Asset
Securitization Corporation
▇▇▇
▇▇▇▇▇
▇▇▇▇▇▇
▇▇▇
▇▇▇▇,
▇▇▇ ▇▇▇▇ ▇▇▇▇▇
Attention:
Head MBS Principal Finance
▇▇▇▇▇
Fargo Bank, N.A.,
as
Securities Administrator
▇▇▇▇▇
▇▇▇▇▇▇ ▇▇▇ ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇▇▇▇▇▇,
▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Attention:
Corporate Trust Services - HASCO 2007-WF1
Re: HSI
Asset
Securitization Corporation Trust 2007-WF1 Mortgage Pass-Through Certificates,
Series 2007-WF1, Class [__]
Ladies
and Gentlemen:
In
connection with our disposition of the above Certificates we certify that
(a) we understand that the Certificates have not been registered under the
Securities Act of 1933, as amended (the “Act”),
and
are being disposed by us in a transaction that is exempt from the registration
requirements of the Act, (b) we have not offered or sold any Certificates
to, or solicited offers to buy any Certificates from, any person, or otherwise
approached or negotiated with any person with respect thereto, in a manner
that
would be deemed, or taken any other action which would result in, a violation
of
Section 5 of the Act and (c) to the extent we are disposing of a
Residual Certificate, (i) we have no knowledge the Transferee is a
Non-Permitted Transferee, (ii) after conducting a reasonable investigation
of the financial condition of the Transferee, we have no knowledge and
no reason
to believe that the Transferee will not pay all taxes with respect to the
Residual Certificates as they become due and (iii) we have no reason to
believe that the statements made in paragraphs 7, 10 and 11 of the
Transferee’s Residual Transfer Affidavit are false.
In
connection with any disposition of the above Certificates in accordance
with
Rule 904 of Regulation S we hereby certify that:
a. the
offer
of the Certificates was not made to a person in the United States;
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b.
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at
the time the buy order was originated, the transferee was outside
the
United States or the Transferor and any person acting on its
behalf
responsibly believed
the transferee was outside the United
States;
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EXH-H-1
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c.
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no
directed selling efforts have been made in contravention of the
requirements of Rule 903 or Rule 904 of Regulation S, as
applicable;
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d.
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the
transaction is not part of a plan or scheme to
evade the registration requirements of the Securities Act, as
amended;
and
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e. the
transferee is not a U.S. person (as defined in Regulation S).
Very
truly yours,
Print
Name of Transferor
By:
Authorized
Officer
EXH-H-2
EXHIBIT
I-A
FORM
OF
RULE 144A INVESTMENT LETTER
____________,
20__
HSI
Asset
Securitization Corporation
▇▇▇
▇▇▇▇▇
▇▇▇▇▇▇
▇▇▇
▇▇▇▇,
▇▇▇ ▇▇▇▇ ▇▇▇▇▇
Attention:
Head MBS Principal Finance
▇▇▇▇▇
Fargo Bank, N.A.,
as
Securities Administrator
▇▇▇▇▇
▇▇▇▇▇▇ ▇▇▇ ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇▇▇▇▇▇,
▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Attention:
Corporate Trust Services - HASCO 2007-WF1
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Re:
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HSI
Asset Securitization Corporation Trust 2007-WF1
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Mortgage
Pass-Through Certificates, Series 2007-WF1, Class [__]
Ladies
and Gentlemen:
In
connection with our acquisition of the above Certificates we certify that
(a) we understand that the Certificates are not being registered under the
Securities Act of 1933, as amended (the “Act”),
or
any state securities laws and are being transferred to us in a transaction
that
is exempt from the registration requirements of the Act and any such laws,
(b) we have such knowledge and experience in financial and business matters
that we are capable of evaluating the merits and risks of investments in
the
Certificates, (c) we have had the opportunity to ask questions of and
receive answers from the Depositor concerning the purchase of the Certificates
and all matters relating thereto or any additional information deemed necessary
to our decision to purchase the Certificates, (d) in the case of an
ERISA-Restricted Certificate, we are not an employee benefit plan that
is
subject to Title I of the Employee Retirement Income Security Act of 1974,
as amended (“ERISA”),
or a
plan or arrangement that is subject to Section 4975 of the Internal Revenue
Code of 1986, as amended, or a plan subject to materially similar provisions
of
applicable federal, state or local law, nor are we acting on behalf of
any such
plan or arrangement nor using the assets of any such plan or arrangement
to
effect such acquisition or, with respect to an ERISA-Restricted Certificate
other than a Class P Certificate, a Class X Certificate or a Residual
Certificate, such Certificate has been the subject of an ERISA-Qualifying
Underwriting and the purchaser is an insurance company that is purchasing
this
certificate with funds contained in an “insurance company general account” (as
such term is defined in Section V(e) of Prohibited Transaction Class
Exemption (“PTCE”)
95-60)
and that the purchase and holding of such Certificates are covered under
Sections I and III of PTCE 95-60, (e) in the case of an
ERISA-Restricted Trust Certificate prior to the termination of the swap
agreement and the cap agreement, either (i) we are not an employee benefit
plan
that is subject to Title I of ERISA, or a plan or arrangement that is
subject to Section 4975 of the Internal Revenue Code of 1986, as amended,
nor a person acting on behalf of any such plan, nor are we using the assets
of
any such plan to effect such transfer or (ii) our acquisition and holding
of the
ERISA-Restricted Trust Certificate is eligible for exemptive relief under
the
statutory exemption for non-fiduciary service providers under Section 408(b)(17)
of ERISA and Section 4975(d)(20) of the Code, ▇▇▇▇ ▇▇-▇▇, ▇▇▇▇ ▇▇-▇, ▇▇▇▇
91-38,
PTCE 95-60 or PTCE 96-23 or some other applicable exemption, (f) we have
not,
nor has anyone acting on our behalf offered, transferred, pledged, sold
or
otherwise disposed of the Certificates, any interest in the Certificates
or any
other similar security to, or solicited any offer to buy or accept a transfer,
pledge or other disposition of the Certificates, any interest in the
Certificates or any other similar security from, or otherwise approached
or
negotiated with respect to the Certificates, any interest in the Certificates
or
any other similar security with, any person in any manner, or made any
general
solicitation by means of general advertising or in any other manner, or
taken
any other action, that would constitute a distribution of the Certificates
under
the Securities Act or that would render the disposition of the Certificates
a
violation of Section 5 of the Securities Act or require registration
pursuant thereto, nor will act, nor has authorized or will authorize any
person
to act, in such manner with respect to the Certificates, and (g) we are a
“qualified institutional buyer” as that term is defined in Rule 144A under
the Securities Act and have completed either of the forms of certification
to
that effect attached hereto as Annex 1 or Annex 2. We are aware that
the sale to us is being made in reliance on Rule 144A. We are acquiring the
Certificates for our own account or for resale pursuant to Rule 144A and
further, understand that such Certificates may be resold, pledged or transferred
only (i) to a person reasonably believed to be a qualified institutional
buyer that purchases for its own account or for the account of a qualified
institutional buyer to whom notice is given that the resale, pledge or
transfer
is being made in reliance on Rule 144A, or (ii) pursuant to another
exemption from registration under the Securities Act.
EXH-I-A-1
ANNEX
1 TO EXHIBIT I
QUALIFIED
INSTITUTIONAL BUYER STATUS UNDER SEC RULE 144A
[For
Transferees Other Than Registered Investment Companies]
The
undersigned (the “Buyer”)
hereby
certifies as follows to the parties listed in the Rule 144A Transferee
Certificate to which this certification relates with respect to the Certificates
described therein:
1. As
indicated below, the undersigned is the President, Chief Financial Officer,
Senior Vice President or other executive officer of the Buyer.
2. In
connection with purchases by the Buyer, the Buyer is a “qualified institutional
buyer” as that term is defined in Rule 144A under the Securities Act of
1933, as amended (“Rule 144A”),
because (i) the Buyer owned and/or invested on a discretionary basis
$________ in securities (except for the excluded securities referred to
below)
as of the end of the Buyer’s most recent fiscal year (such amount being
calculated in accordance with Rule 144A and (ii) the Buyer satisfies
the criteria in the category marked below.
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____
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Corporation,
etc.
The Buyer is a corporation (other than a bank, savings and loan
association or similar institution), Massachusetts or similar
business
trust, partnership, or charitable organization described in
Section 501(c)(3) of the Internal Revenue Code of 1986, as
amended.
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____
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Bank.
The Buyer (a) is a national bank or banking institution organized
under the laws of any State, territory or the District of Columbia,
the
business of which is substantially confined to banking and is
supervised
by the State or territorial banking commission or similar official
or is a
foreign bank or equivalent institution, and (b) has an audited net
worth of at least $25,000,000 as demonstrated in its latest annual
financial statements, a copy of which is attached
hereto.
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____
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Savings
and Loan.
The Buyer (a) is a savings and loan association, building and loan
association, cooperative bank, homestead association or similar
institution, which is supervised and examined by a State or Federal
authority having supervision over any such institutions or is
a foreign
savings and loan association or equivalent institution and (b) has an
audited net worth of at least $25,000,000 as demonstrated in
its latest
annual financial statements, a copy of which is attached
hereto.
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____
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Broker-dealer.
The Buyer is a dealer registered pursuant to Section 15 of the
Securities Exchange Act of 1934.
|
1 Buyer
must own and/or invest on a discretionary basis at least $100,000,000
in
securities unless Buyer is a dealer, and, in that case, Buyer must own
and/or
invest on a discretionary basis at least $10,000,000 in
securities.
EXH-I-A-2
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____
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Insurance
Company.
The Buyer is an insurance company whose primary and predominant
business
activity is the writing of insurance or the reinsuring of risks
underwritten by insurance companies and which is subject to supervision
by
the insurance commissioner or a similar official or agency of
a State,
territory or the District of
Columbia.
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____
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State
or Local Plan.
The Buyer is a plan established and maintained by a State, its
political
subdivisions, or any agency or instrumentality of the State or
its
political subdivisions, for the benefit of its
employees.
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____
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ERISA
Plan.
The Buyer is an employee benefit plan within the meaning of Title I
of the Employee Retirement Income Security Act of
1974.
|
|
____
|
Investment
Advisor.
The Buyer is an investment advisor registered under the Investment
Advisors Act of 1940.
|
|
____
|
Small
Business Investment Company.
Buyer is a small business investment company licensed by the
U.S. Small
Business Administration under Section 301(c) or (d) of the Small
Business
Investment Act of 1958.
|
|
____
|
Business
Development Company.
Buyer is a business development company as defined in Section
202(a)(22)
of the Investment Advisors Act of
1940.
|
3. The
term
“securities”
as
used
herein does
not include
(i) securities of issuers that are affiliated with the Buyer,
(ii) securities that are part of an unsold allotment to or subscription by
the Buyer, if the Buyer is a dealer, (iii) securities issued or guaranteed
by the U.S. or any instrumentality thereof, (iv) bank deposit notes and
certificates of deposit, (v) loan participations, (vi) repurchase
agreements, (vii) securities owned but subject to a repurchase agreement
and (viii) currency, interest rate and commodity swaps.
4. For
purposes of determining the aggregate amount of securities owned and/or
invested
on a discretionary basis by the Buyer, the Buyer used the cost of such
securities to the Buyer and did not include any of the securities referred
to in
the preceding paragraph, except (i) where the Buyer reports its securities
holdings in its financial statements on the basis of their market value,
and
(ii) no current information with respect to the cost of those securities
has been published. If clause (ii) in the preceding sentence applies, the
securities may be valued at market. Further, in determining such aggregate
amount, the Buyer may have included securities owned by subsidiaries of
the
Buyer, but only if such subsidiaries are consolidated with the Buyer in
its
financial statements prepared in accordance with generally accepted accounting
principles and if the investments of such subsidiaries are managed under
the
Buyer’s direction. However, such securities were not included if the Buyer is
a
majority-owned, consolidated subsidiary of another enterprise and the Buyer
is
not itself a reporting company under the Securities Exchange Act of 1934,
as
amended.
5. The
Buyer
acknowledges that it is familiar with Rule 144A and understands that the
seller to it and other parties related to the Certificates are relying
and will
continue to rely on the statements made herein because one or more sales
to the
Buyer may be in reliance on Rule 144A.
EXH-I-A-3
6. Until
the
date of purchase of the Rule 144A Securities, the Buyer will notify each of
the parties to which this certification is made of any changes in the
information and conclusions herein. Until such notice is given, the Buyer’s
purchase of the Certificates will constitute a reaffirmation of this
certification as of the date of such purchase. In addition, if the Buyer
is a
bank or savings and loan is provided above, the Buyer agrees that it will
furnish to such parties updated annual financial statements promptly after
they
become available.
Print
Name of Transferee
By:
Name:
Title:
Date:
EXH-I-A-4
ANNEX
2 TO EXHIBIT I
QUALIFIED
INSTITUTIONAL BUYER STATUS UNDER SEC RULE 144A
[For
Transferees That Are Registered Investment Companies]
The
undersigned (the “Buyer”)
hereby
certifies as follows to the parties listed in the Rule 144A Transferee
Certificate to which this certification relates with respect to the Certificates
described therein:
1. As
indicated below, the undersigned is the President, Chief Financial Officer
or
Senior Vice President of the Buyer or, if the Buyer is a “qualified
institutional buyer” as that term is defined in Rule 144A under the
Securities Act of 1933, as amended (“Rule 144A”),
because Buyer is part of a Family of Investment Companies (as defined below),
is
such an officer of the Adviser.
2. In
connection with purchases by Buyer, the Buyer is a “qualified institutional
buyer” as defined in SEC Rule 144A because (i) the Buyer is an
investment company registered under the Investment Company Act of 1940,
as
amended, and (ii) as marked below, the Buyer alone, or the Buyer’s Family
of Investment Companies, owned at least $100,000,000 in securities (other
than
the excluded securities referred to below) as of the end of the Buyer’s most
recent fiscal year. For purposes of determining the amount of securities
owned
by the Buyer or the Buyer’s Family of Investment Companies, the cost of such
securities was used, except (i) where the Buyer or the Buyer’s Family of
Investment Companies reports its securities holdings in its financial statements
on the basis of their market value, and (ii) no current information with
respect to the cost of those securities has been published. If clause (ii)
in the preceding sentence applies, the securities may be valued at
market.
|
____
|
The
Buyer owned $_______ in securities (other than the excluded securities
referred to below) as of the end of the Buyer’s most recent fiscal year
(such amount being calculated in accordance with
Rule 144A).
|
|
____
|
The
Buyer is part of a Family of Investment Companies which owned
in the
aggregate $_______ in securities (other than the excluded securities
referred to below) as of the end of the Buyer’s most recent fiscal year
(such amount being calculated in accordance with
Rule 144A).
|
3. The
term
“Family
of Investment Companies”
as
used
herein means two or more registered investment companies (or series thereof)
that have the same investment adviser or investment advisers that are affiliated
(by virtue of being majority owned subsidiaries of the same parent or because
one investment adviser is a majority owned subsidiary of the
other).
4. The
term
“securities”
as
used
herein does not include (i) securities of issuers that are affiliated with
the Buyer or are part of the Buyer’s Family of Investment Companies,
(ii) securities issued or guaranteed by the U.S. or any instrumentality
thereof, (iii) bank deposit notes and certificates of deposit,
(iv) loan participations, (v) repurchase agreements,
(vi) securities owned but subject to a repurchase agreement and
(vii) currency, interest rate and commodity swaps.
EXH-I-A-5
5. The
Buyer
is familiar with Rule 144A and understands that the parties listed in the
Rule 144A Transferee Certificate to which this certification relates are
relying and will continue to rely on the statements made herein because
one or
more sales to the Buyer will be in reliance on Rule 144A. In addition, the
Buyer will only purchase for the Buyer’s own account.
6. Until
the
date of purchase of the Certificates, the undersigned will notify the parties
listed in the Rule 144A Transferee Certificate to which this certification
relates of any changes in the information and conclusions herein. Until
such
notice is given, the Buyer’s purchase of the Certificates will constitute a
reaffirmation of this certification by the undersigned as of the date of
such
purchase.
Print
Name of Transferee
By:
Name:
Title:
IF
AN
ADVISER:
Print
Name of Buyer
Date:
EXH-I-A-6
EXHIBIT
I-B
FORM
OF
REGULATION S INVESTMENT LETTER
____________,
20__
HSI
Asset
Securitization Corporation
▇▇▇
▇▇▇▇▇
▇▇▇▇▇▇
▇▇▇
▇▇▇▇,
▇▇▇ ▇▇▇▇ ▇▇▇▇▇
Attention:
Head MBS Principal Finance
▇▇▇▇▇
Fargo Bank, N.A.,
as
Securities Administrator
▇▇▇▇▇
▇▇▇▇▇▇ ▇▇▇ ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇▇▇▇▇▇,
▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Attention:
Corporate Trust Services - HASCO 2007-WF1
|
Re:
|
HSI
Asset Securitization Corporation Trust 2007-WF1
|
Mortgage
Pass-Through Certificates, Series 2007-WF1, Class [__]
Ladies
and Gentlemen:
In
connection with our acquisition of the above Certificates we certify that
(a) we understand that the Certificates are not being registered under the
Securities Act of 1933, as amended (the “Act”),
or
any state securities laws and are being transferred to us in a transaction
that
is exempt from the registration requirements of the Act and any such laws,
(b) we have such knowledge and experience in financial and business matters
that we are capable of evaluating the merits and risks of investments in
the
Certificates, (c) we have had the opportunity to ask questions of and
receive answers from the Depositor concerning the purchase of the Certificates
and all matters relating thereto or any additional information deemed necessary
to our decision to purchase the Certificates, (d) in the case of an
ERISA-Restricted Certificate, we are not an employee benefit plan that
is
subject to Title I of the Employee Retirement Income Security Act of 1974,
as amended (“ERISA”),
or a
plan or arrangement that is subject to Section 4975 of the Internal Revenue
Code of 1986, as amended, or a plan subject to materially similar provisions
of
applicable federal, state or local law, nor are we acting on behalf of
any such
plan or arrangement nor using the assets of any such plan or arrangement
to
effect such acquisition or, with respect to an ERISA-Restricted Certificate
other than a Class P Certificate, a Class X Certificate or a Residual
Certificate, such Certificate has been the subject of an ERISA-Qualifying
Underwriting and the purchaser is an insurance company that is purchasing
this
certificate with funds contained in an “insurance company general account” (as
such term is defined in Section V(e) of Prohibited Transaction Class
Exemption (“PTCE”)
95-60)
and that the purchase and holding of such Certificates are covered under
Sections I and III of PTCE 95-60, (e) in the case of an
ERISA-Restricted Trust Certificate prior to the termination of the swap
agreement and the cap agreement, either (i) we are not an employee benefit
plan
that is subject to Title I of ERISA, or a plan or arrangement that is
subject to Section 4975 of the Internal Revenue Code of 1986, as amended,
nor a person acting on behalf of any such plan, nor are we using the assets
of
any such plan to effect such transfer or (ii) our acquisition and holding
of the
ERISA-Restricted Trust Certificate is eligible for exemptive relief under
the
statutory exemption for non-fiduciary service providers under Section 408(b)(17)
of ERISA and Section 4975(d)(20) of the Code, ▇▇▇▇ ▇▇-▇▇, ▇▇▇▇ ▇▇-▇, ▇▇▇▇
91-38,
PTCE 95-60 or PTCE 96-23 or some other applicable exemption, (f) we have
not,
nor has anyone acting on our behalf offered, transferred, pledged, sold
or
otherwise disposed of the Certificates, any interest in the Certificates
or any
other similar security to, or solicited any offer to buy or accept a transfer,
pledge or other disposition of the Certificates, any interest in the
Certificates or any other similar security from, or otherwise approached
or
negotiated with respect to the Certificates, any interest in the Certificates
or
any other similar security with, any person in any manner, or made any
general
solicitation by means of general advertising or in any other manner, or
taken
any other action, that would constitute a distribution of the Certificates
under
the Securities Act or that would render the disposition of the Certificates
a
violation of Section 5 of the Securities Act or require registration
pursuant thereto, nor will act, nor has authorized or will authorize any
person
to act, in such manner with respect to the Certificates, and (g) we are not
a U.S. person within the meaning of Regulation S of the Securities Act
and was
at the time the buy order was originated for the Class [ ] Certificates
outside
the United States. We are aware that the sale to us is being made in reliance
on
Regulation S of the Securities Act and we understand (x) that until the
expiration of the 40-day distribution
compliance period (within the meaning of Regulation S), no offer, sale,
pledge
or other transfer of such Certificates or any interest therein shall be
made in
the United States or to or for the account or benefit of a U.S. person
(each as
defined in Regulation S), (y) if in the future we decide to offer, resell,
pledge or otherwise transfer such Certificates, such Certificates may be
offered, resold, pledged or transferred only to (A) a person which the
seller
reasonably believes is a “qualified institutional buyer” (a “QIB”) as defined in
Rule 144A under the Securities Act, that is purchasing such Certificate
for its
own account or for the account of a QIB in reliance on Rule 144A or (B)
in an
offshore transaction (as defined in Regulation S) in compliance with the
provisions of Regulation S, in each case in compliance with the requirements
of
the Agreement; and we will notify such transferee of the transfer restrictions
specified in the Agreement.
EXH-I-B-1
Print
Name of Transferee
By:
Name:
Title:
IF
AN
ADVISER:
Print
Name of Buyer
Date:
EXH-I-B-2
EXHIBIT
J
FORM
OF
REQUEST FOR RELEASE
(for
Custodian)
To: ▇▇▇▇▇
Fargo Bank, N.A.
▇▇
▇▇▇▇▇▇▇▇▇ ▇▇▇▇
▇▇▇▇▇▇,
▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇
|
Re:
|
Pooling
and Servicing Agreement (the “Pooling and Servicing Agreement”) dated as
of June 1, 2007 among HSI Asset Securitization Corporation, as
depositor,
▇▇▇▇▇ Fargo Bank, N.A., as originator, as servicer, master servicer,
securities administrator and custodian, OfficeTiger Global Real
Estate
Services Inc., as credit risk manager, and Deutsche Bank National
Trust
Company, as trustee.
|
In
connection with the administration of the Mortgage Loans held by you as
the
Custodian on behalf of the Certificateholders, we request the release,
and
acknowledge receipt, of the (Custodial File/[specify documents]) for the
Mortgage Loan described below, for the reason indicated.
Mortgagor’s
Name, Address & Zip Code:
Mortgage
Loan Number:
Send
Custodial File to:
Delivery
Method (check one)
____1. Regular
mail
____2. Overnight
courier (Tracking information:
)
If
neither box 1 nor 2 is checked, regular mail shall be assumed.
Reason
for Requesting Documents
(check
one)
____1. Mortgage
Loan Paid in Full.
(The
Servicer hereby certifies that all amounts received in connection therewith
have
been credited to the Collection Account as provided in the Pooling and
Servicing
Agreement.)
____2. Mortgage
Loan Repurchase Pursuant to Subsection 2.03 of the Pooling and Servicing
Agreement.
(The
Servicer hereby certifies that the repurchase price has been credited to
the
Collection Account as provided in the Pooling and Servicing
Agreement.)
EXH-J-1
____3. Mortgage
Loan Liquidated by _________________. (The Servicer hereby certifies that
all
proceeds of foreclosure, insurance, condemnation or other liquidation have
been
finally received and credited to the Collection Account pursuant to the
Pooling
and Servicing Agreement.)
____4. Mortgage
Loan in Foreclosure.
____5. Other
(explain).
If
box 1,
2 or 3 above is checked, and if all or part of the Custodial File was previously
released to us, please release to us our previous request and receipt on
file
with you, as well as any additional documents in your possession relating
to the
specified Mortgage Loan.
If
box 4
or 5 above is checked, upon our return of all of the above documents to
you as
the Trustee, please acknowledge your receipt by signing in the space indicated
below, and returning this form if requested by us.
[______________]
By:
Name:
Title:
Date:
ACKNOWLEDGED
AND AGREED:
▇▇▇▇▇
FARGO BANK, N.A.
By:
Name:
Title:
Date:
EXH-J-2
EXHIBIT
K
CONTENTS
OF EACH 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 Depositor
and
which shall be retained by the Servicer or delivered to and retained by
the
Custodian:
(a) The
documents or instruments set forth as items (i) to (ix) in Section 2.01(b)
of the Pooling and Servicing Agreement.
(b) Residential
loan application.
(c) Mortgage
Loan closing statement.
(d) Verification
of employment and income.
(e) Verification
of acceptable evidence of source and amount of downpayment.
(f) Credit
report on Mortgagor.
(g) Residential
appraisal report.
(h) Photograph
of the Mortgaged Property.
(i) Survey
of
the Mortgaged Property.
(j) Copy
of
each instrument necessary to complete identification of any exception set
forth
in the exception schedule in the title policy, i.e., map or plat, restrictions,
easements, sewer agreements, home association declarations, etc.
(k) All
required disclosure statements and statement of Mortgagor confirming receipt
thereof.
(l) If
available, termite report, structural engineer’s report, water potability and
septic certification.
(m) Sales
contract, if applicable.
(n) Hazard
insurance policy.
(o) Tax
receipts, insurance premium receipts, ledger sheets, payment history from
date
of origination, insurance claim files, correspondence, current and historical
computerized data files, and all other processing, underwriting and closing
papers and records which are customarily contained in a mortgage loan file
and
which are required to document the Mortgage Loan or to service the Mortgage
Loan.
EXH-K-1
(p) Amortization
schedule, if available.
(q) Payment
history for Mortgage Loans that have been closed for more than 90
days.
EXH-K-2
EXHIBIT
L
FORM
OF
▇▇▇▇▇▇▇▇-▇▇▇▇▇ CERTIFICATION TO BE
PROVIDED
BY MASTER SERVICER (OR OTHER
CERTIFICATION
PARTY) WITH FORM 10-K
HSI
Asset
Securitization Corporation Trust 2007-WF1
Mortgage
Pass-Through Certificates
Series
2007-WF1
This
Certification is being made pursuant to Section 3.24 and Section 8.12 of
the Pooling and Servicing Agreement dated as of June 1, 2007 (the “Pooling
and Servicing Agreement”)
relating to the above-referenced Series, among HSI Asset Securitization
Corporation, as depositor, ▇▇▇▇▇ Fargo Bank, N.A., as originator, as servicer,
master servicer, securities administrator and custodian, OfficeTiger Global
Real
Estate Services Inc., as credit risk manager, and Deutsche Bank National
Trust
Company, as trustee. Capitalized terms used but not defined herein shall
have
the meanings assigned in the Pooling and Servicing Agreement.
1. I
have
reviewed this annual report on Form 10-K, and all reports on Form 10-D
required to be filed in respect of the period covered by this report on
Form
10-K of HSI Asset Securitization Corporation Trust 2007-WF1 (the “Exchange Act
periodic reports”);
2. Based
on
my knowledge, the Exchange Act periodic reports, taken as a whole, do not
contain any untrue statement of a material fact or omit to state a material
fact
necessary to make the statements made, in light of the circumstances under
which
such statements were made, not misleading with respect to the period covered
by
this report;
3. Based
on
my knowledge, all of the distribution, servicing and other information
required
to be provided under Form 10-D for the period covered by this report is
included
in the Exchange Act periodic reports;
4. I
am
responsible for reviewing the activities performed by the servicer and
based on
my knowledge and the compliance review conducted in preparing the Servicer
compliance statement required in this report under Item 1123 of Regulation
AB,
and except as disclosed in the Exchange Act periodic reports, the Servicer
has
fulfilled its obligations under the Pooling and Servicing agreement;
and
5. All
of
the reports on assessment of compliance with servicing criteria for asset-backed
securities and their related attestation reports on assessment of compliance
with servicing criteria for asset-backed securities required to be included
in
this report in accordance with Item 1122 of Regulation AB and Exchange
Act Rules
13a-18 and 15d-18 have been included as an exhibit to this report, except
as
otherwise disclosed in this report. Any material instances of noncompliance
described in such reports have been disclosed in this report on Form
10-K.
EXH-L-1
In
giving
the certifications above, I have reasonably relied on information provided
to me
by the following parties: [_____].
▇▇▇▇▇
FARGO BANK, N.A.
as
Master
Servicer
By:
Name:
Title:
Date:
EXH-L-2
EXHIBIT
M
FORM
OF
BACK-UP ▇▇▇▇▇▇▇▇-▇▇▇▇▇ CERTIFICATION
|
Re:
|
Pooling
and Servicing Agreement, dated as of May 1, 2007 (the “Agreement”),
among HSI Asset Securitization Corporation, as depositor (the
“Depositor”),
▇▇▇▇▇ Fargo Bank, N.A., as originator, as servicer, as master
servicer
(the “Master
Servicer”),
securities administrator (the “Securities
Administrator”)
and custodian, OfficeTiger Global Real Estate Services Inc.,
as credit
risk manager, and Deutsche Bank National Trust Company, as
trustee
|
I,
____________________________, the _______________________ of [NAME OF COMPANY]
(the “Company”), certify to the Depositor and their officers, with the knowledge
and intent that they will rely upon this certification, that:
1. I
have
reviewed the servicer compliance statement of the Company provided in accordance
with Item 1123 of Regulation AB (the “Compliance Statement”), the report on
assessment of the Company’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 Company during 200[ ] that were delivered
by the
Company to the Depositor, the Master Servicer and the Securities Administrator
pursuant to the Agreement (collectively, the “Company Servicing
Information”);
2. Based
on
my knowledge, the Company 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 Company Servicing Information;
3. Based
on
my knowledge, all of the Company Servicing Information required to be provided
by the Company under the Agreement has been provided to the Depositor,
the
Master Servicer and the Securities Administrator;
4. I
am
responsible for reviewing the activities performed by the Company 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
Company has fulfilled its obligations under the Agreement in all material
respects; and
EXH-M-1
5. The
Compliance Statement required to be delivered by the Company pursuant to
this
Agreement, and the Servicing Assessment and Attestation Report required
to be
provided by the Company and by any Subservicer and Subcontractor pursuant
to the
Agreement, have been provided to the Depositor, the Master Servicer and
the
Securities Administrator. Any material instances of noncompliance described
in
such reports have been disclosed to the Depositor, the Master Servicer
and the
Securities Administrator. Any material instance of noncompliance with the
Servicing Criteria has been disclosed in such reports.
|
Date:
_________________________
|
|
|
By: _______________________________
|
|
|
Name:
|
|
|
Title:
|
EXH-M-2
EXHIBIT
N-1
FORM
OF
MONTHLY REMITTANCE ADVICE
|
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 ($)
|
11
|
|
SERV_CURT_DATE_1
|
The
curtailment date associated with the first curtailment amount.
|
|
MM/DD/YYYY
|
10
|
EXH-N-1-1
|
Column
Name
|
Description
|
Decimal
|
Format
Comment
|
Max
Size
|
|
CURT_ADJ_
AMT_1
|
The
curtailment interest on the first curtailment amount, if
applicable.
|
2
|
No
commas(,) or dollar signs ($)
|
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 ($)
|
11
|
|
PIF_DATE
|
The
paid in full date as reported by the Servicer.
|
|
MM/DD/YYYY
|
10
|
|
|
|
|
Action
Code Key: 15=Bankruptcy, ▇▇▇▇▇▇▇▇▇▇▇▇▇▇, , ▇▇▇▇▇▇, 63=Substitution,
65=Repurchase,70=REO
|
2
|
|
ACTION_CODE
|
The
standard FNMA numeric code used to indicate the default/delinquent
status
of a particular loan.
|
|||
|
INT_ADJ_AMT
|
The
amount of the interest adjustment as reported by the
Servicer.
|
2
|
No
commas(,) or dollar signs ($)
|
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 ($)
|
11
|
EXH-N-1-2
|
Column
Name
|
Description
|
Decimal
|
Format
Comment
|
Max
Size
|
|
ACTL_PRIN_AMT
|
The
actual principal amount collected by the Servicer for the current
reporting cycle -- only applicable for Actual/Actual
Loans.
|
2
|
No
commas(,) or dollar signs ($)
|
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
|
EXH-N-1-3
EXHIBIT
N-2
STANDARD
LAYOUT FOR MONTHLY DEFAULTED LOAN REPORT
Exhibit
: Standard
File Layout - Delinquency Reporting
*The
column/header names in bold
are
the minimum fields ▇▇▇▇▇ Fargo must receive from every
Servicer
|
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
|
EXH-N-2-1
|
Column/Header
Name
|
Description
|
Decimal
|
Format
Comment
|
|
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
|
EXH-N-2-2
|
Column/Header
Name
|
Description
|
Decimal
|
Format
Comment
|
|
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
|
EXH-N-2-3
NOTE:
▇▇▇▇▇
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 ▇▇▇▇▇ 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
EXH-N-2-4
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
|
EXH-N-2-5
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
|
EXH-N-2-6
EXHIBIT
N-3
FORM
OF
LOAN LOSS REPORT
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.
(b)
(c) 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
Servicing Officer certification
*
Unusual
or extraordinary items may require further documentation.
EXH-N-3-1
13. The
total
of lines 1 through 12.
(d) 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 ( ).
|
EXH-N-3-2
Exhibit
3A: Calculation
of Realized Loss/Gain Form 332
|
Prepared
by: __________________
|
Date:
_______________
|
|
|
Phone:
______________________
|
Email
Address:_____________________
|
|
Servicer
Loan No.
|
Servicer
Name
|
Servicer
Address
|
▇▇▇▇▇
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
|
|||
|
HUD
Part B
|
________________
|
(18b)
|
|
|
(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)
|
|
EXH-N-3-3
Escrow
Disbursement Detail
|
Type
(Tax
/Ins.)
|
Date
Paid
|
Period
of Coverage
|
Total
Paid
|
Base
Amount
|
Penalties
|
Interest
|
EXH-N-3-4
EXHIBIT
O
FORM
OF SWAP AGREEMENT
EXH-O-1
EXHIBIT
P
FORM
OF CAP AGREEMENT
EXH-P-1
EXHIBIT
Q
SELLER’S
WARRANTIES AND SERVICING AGREEMENT
EXH-Q-1
EXHIBIT
R
[RESERVED]
EXH-R-1
EXHIBIT
S
SERVICING
CRITERIA MATRIX
The
assessment of compliance to be delivered by ▇▇▇▇▇ Fargo Bank, N.A. (“▇▇▇▇▇
Fargo”), in its capacities as Servicer, Master Servicer, Securities
Administrator and Custodian, shall address, at a minimum, the criteria
identified as below as “Applicable Servicing Criteria”.
Capitalized
terms used herein but not defined herein shall have the meanings assigned
to
them in the Pooling and Servicing Agreement dated as of June 1, 2007 (the
“Pooling and Servicing Agreement”), by and among HSI Asset Securitization
Corporation, as depositor, ▇▇▇▇▇ Fargo Bank, N.A., as originator, as servicer,
master servicer, securities administrator and custodian, OfficeTiger Global
Real
Estate Services Inc., as credit risk manager, and Deutsche Bank National
Trust
Company, as trustee.
|
Reg
AB Reference
|
Servicing
Criteria
|
▇▇▇▇▇
Fargo
|
Servicer*
|
|
General Servicing
Considerations
|
|||
|
1122(d)(1)(i)
|
Policies
and procedures are instituted to monitor any performance or other
triggers
and events of default in accordance with the transaction
agreements.
|
X
|
X
|
|
1122(d)(1)(ii)
|
If
any material servicing activities are outsourced to third parties,
policies and procedures are instituted to monitor the third party’s
performance and compliance with such servicing activities.
|
X
|
X
|
|
1122(d)(1)(iii)
|
Any
requirements in the transaction agreements to maintain a back-up
servicer
for the pool assets are maintained.
|
||
|
1122(d)(1)(iv)
|
A
fidelity bond and errors and omissions policy is in effect on
the party
participating in the servicing function throughout the reporting
period in
the amount of coverage required by and otherwise in accordance
with the
terms of the transaction agreements.
|
X
|
X
|
|
Cash Collection and Administration
|
|||
|
1122(d)(2)(i)
|
Payments
on pool assets are deposited into the appropriate custodial bank
accounts
and related bank clearing accounts no more than two business
days
following receipt, or such other number of days specified in
the
transaction agreements.
|
X
|
X
|
|
1122(d)(2)(ii)
|
Disbursements
made via wire transfer on behalf of an obligor or to an investor
are made
only by authorized personnel.
|
X
|
X
|
|
1122(d)(2)(iii)
|
Advances
of funds or guarantees regarding collections, cash flows or distributions,
and any interest or other fees charged for such advances, are
made,
reviewed and approved as specified in the transaction agreements.
|
X
|
X
|
EXH-S-1
|
Reg
AB Reference
|
Servicing
Criteria
|
▇▇▇▇▇
Fargo
|
Servicer*
|
|
1122(d)(2)(iv)
|
The
related accounts for the transaction, such as cash reserve accounts
or
accounts established as a form of over collateralization, are
separately
maintained (e.g., with respect to commingling of cash) as set
forth in the
transaction agreements.
|
X
|
X
|
|
1122(d)(2)(v)
|
Each
custodial account is maintained at a federally insured depository
institution as set forth in the transaction agreements. For purposes
of
this criterion, “federally insured depository institution” with respect to
a foreign financial institution means a foreign financial institution
that
meets the requirements of Rule 13k-1(b)(1) of the Securities
Exchange Act.
|
X
|
X
|
|
1122(d)(2)(vi)
|
Unissued
checks are safeguarded so as to prevent unauthorized access.
|
X
|
X
|
|
1122(d)(2)(vii)
|
Reconciliations
are prepared on a monthly basis for all asset-backed securities
related
bank accounts, including custodial accounts and related bank
clearing
accounts. These reconciliations are (A) mathematically accurate;
(B)
prepared within 30 calendar days after the bank statement cutoff
date, or
such other number of days specified in the transaction agreements;
(C)
reviewed and approved by someone other than the person who prepared
the
reconciliation; and (D) contain explanations for reconciling
items. These
reconciling items are resolved within 90 calendar days of their
original
identification, or such other number of days specified in the
transaction
agreements.
|
X
|
A,
B & D
|
|
Investor
Remittances and Reporting
|
|||
|
1122(d)(3)(i)
|
Reports
to investors, including those to be filed with the Commission,
are
maintained in accordance with the transaction agreements and
applicable
Commission requirements. Specifically, such reports (A) are prepared
in
accordance with timeframes and other terms set forth in the transaction
agreements; (B) provide information calculated in accordance
with the
terms specified in the transaction agreements; (C) are filed
with the
Commission as required by its rules and regulations; and (D)
agree with
investors’ or the trustee’s records as to the total unpaid principal
balance and number of pool assets serviced by the Servicer.
|
X
|
X
|
|
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
|
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
|
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
|
X
|
|
Pool
Asset Administration
|
EXH-S-2
|
Reg
AB Reference
|
Servicing
Criteria
|
▇▇▇▇▇
Fargo
|
Servicer*
|
|
1122(d)(4)(i)
|
Collateral
or security on pool assets is maintained as required by the transaction
agreements or related pool asset documents.
|
X
|
X
|
|
1122(d)(4)(ii)
|
Pool
assets and related documents are safeguarded as required by the
transaction agreements
|
X
|
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
|
|
|
1122(d)(4)(iv)
|
Payments
on pool assets, including any payoffs, made in accordance with
the related
pool asset documents are posted to the Servicer’s obligor records
maintained no more than two business days after receipt, or such
other
number of days specified in the transaction agreements, and allocated
to
principal, interest or other items (e.g., escrow) in accordance
with the
related pool asset documents.
|
X
|
|
|
1122(d)(4)(v)
|
The
Servicer’s records regarding the pool assets agree with the Servicer’s
records with respect to an obligor’s unpaid principal balance.
|
X
|
|
|
1122(d)(4)(vi)
|
Changes
with respect to the terms or status of an obligor's pool assets
(e.g.,
loan modifications or re-agings) are made, reviewed and approved
by
authorized personnel in accordance with the transaction agreements
and
related pool asset documents.
|
X
|
|
|
1122(d)(4)(vii)
|
Loss
mitigation or recovery actions (e.g., forbearance plans, modifications
and
deeds in lieu of foreclosure, foreclosures and repossessions,
as
applicable) are initiated, conducted and concluded in accordance
with the
timeframes or other requirements established by the transaction
agreements.
|
X
|
|
|
1122(d)(4)(viii)
|
Records
documenting collection efforts are maintained during the period
a pool
asset is delinquent in accordance with the transaction agreements.
Such
records are maintained on at least a monthly basis, or such other
period
specified in the transaction agreements, and describe the entity’s
activities in monitoring delinquent pool assets including, for
example,
phone calls, letters and payment rescheduling plans in cases
where
delinquency is deemed temporary (e.g., illness or unemployment).
|
X
|
|
|
1122(d)(4)(ix)
|
Adjustments
to interest rates or rates of return for pool assets with variable
rates
are computed based on the related pool asset documents.
|
X
|
|
|
1122(d)(4)(x)
|
Regarding
any funds held in trust for an obligor (such as escrow accounts):
(A) such
funds are analyzed, in accordance with the obligor’s pool asset documents,
on at least an annual basis, or such other period specified in
the
transaction agreements; (B) interest on such funds is paid, or
credited,
to obligors in accordance with applicable pool asset documents
and state
laws; and (C) such funds are returned to the obligor within 30
calendar
days of full repayment of the related pool assets, or such other
number of
days specified in the transaction agreements.
|
X
|
EXH-S-3
|
Reg
AB Reference
|
Servicing
Criteria
|
▇▇▇▇▇
Fargo
|
Servicer*
|
|
1122(d)(4)(xi)
|
Payments
made on behalf of an obligor (such as tax or insurance payments)
are made
on or before the related penalty or expiration dates, as indicated
on the
appropriate bills or notices for such payments, provided that
such support
has been received by the servicer at least 30 calendar days prior
to these
dates, or such other number of days specified in the transaction
agreements.
|
X
|
|
|
1122(d)(4)(xii)
|
Any
late payment penalties in connection with any payment to be made
on behalf
of an obligor are paid from the Servicer’s funds and not charged to the
obligor, unless the late payment was due to the obligor’s error or
omission.
|
X
|
|
|
1122(d)(4)(xiii)
|
Disbursements
made on behalf of an obligor are posted within two business days
to the
obligor’s records maintained by the servicer, or such other number of
days
specified in the transaction agreements.
|
X
|
|
|
1122(d)(4)(xiv)
|
Delinquencies,
charge-offs and uncollectible accounts are recognized and recorded
in
accordance with the transaction agreements.
|
X
|
X
|
|
1122(d)(4)(xv)
|
Any
external enhancement or other support, identified in Item 1114(a)(1)
through (3) or Item 1115 of Regulation AB, is maintained as set
forth in
the transaction agreements.
|
[X]
if
obligated under transaction documents
|
|
EXH-S-4
EXHIBIT
T
Trustee:
Deutsche Bank National Trust Company
Securities
Administrator:
▇▇▇▇▇
Fargo Bank, N.A.
Master
Servicer:
▇▇▇▇▇
Fargo Bank, N.A.
Derivative
Counterparty:
Credit
Suisse International
Servicer:
▇▇▇▇▇
Fargo Bank, N.A.
Originator:
▇▇▇▇▇
Fargo Bank, N.A.
Custodian:
▇▇▇▇▇
Fargo Bank, N.A.
Sponsor:
HSBC
Bank USA, National Association
Credit
Risk Manager:
OfficeTiger Global Real Estate Services Inc.
EXH-T-1
EXHIBIT
U
FORM
OF ANNUAL COMPLIANCE CERTIFICATE
Via
Overnight Delivery
[DATE]
HSI
Asset
Securitization Corporation,
▇▇▇
▇▇▇▇▇
▇▇▇▇▇▇
▇▇▇
▇▇▇▇,
▇▇▇ ▇▇▇▇ ▇▇▇▇▇
Attention:
Head MBS Principal Finance
▇▇▇▇▇
Fargo Bank, N.A.,
▇▇▇▇
▇▇▇
▇▇▇▇▇▇▇▇▇ ▇▇▇▇
▇▇▇▇▇▇▇▇,
▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Attention:
Client Manager - HASCO 2007-WF1
|
RE:
|
Annual
officer’s certificate delivered pursuant to Section 3.24 of that certain
Pooling Servicing Agreement, dated as of June 1, 2007 (the “Pooling
and Servicing Agreement”),
among HSI Asset Securitization Corporation, as depositor (the
“Depositor”),
▇▇▇▇▇ Fargo Bank, N.A., as originator, as servicer (the “Servicer”),
master servicer (the “Master
Servicer”),
securities administrator (the “Securities
Administrator”)
and custodian, OfficeTiger Global Real Estate Services Inc.,
as credit
risk manager, and Deutsche Bank National Trust Company, as trustee
(the
“Trustee”)
|
[_______],
the undersigned, a duly authorized [_______] of [the Servicer] [Master
Servicer]
[Securities Administrator] [Subservicer], does hereby certify the following
for
the [calendar year][identify other period] ending on December 31,
20[__]:
|
1.
|
A
review of the activities of the [Servicer] [Master Servicer]
[Securities
Administrator] during the preceding calendar year (or portion
thereof) and
of its performance under the Agreement for such period has been
made under
my supervision.
|
|
2.
|
To
the best of my knowledge, based on such review, the [Servicer]
[Master
Servicer] [Securities Administrator] [Subservicer] has fulfilled
all of
its obligations under the Agreement in all material respects
throughout
such year (or applicable portion thereof), or, if there has been
a failure
to fulfill any such obligation in any material respect, I have
specifically identified to the Depositor and the [Servicer][Master
Servicer][Securities Administrator] each such failure known to
me and the
nature and status thereof, including the steps being taken by
the
[Servicer] [Master Servicer] [Securities Administrator] [Subservicer]
to
remedy such default.
|
EXH-U-1
Certified
By:
______________________________
Name:
Title:
EXH-U-2
EXHIBIT
V
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]
|
Master
Servicer, 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)
|
Master
Servicer, Securities Administrator, Servicer 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
|
|
▪
Servicer
|
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
|
EXH-V-1
|
ADDITIONAL
FORM 10-D DISCLOSURE
|
|
|
Item
on Form 10-D
|
Party
Responsible
|
|
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
|
|
Item
5: Submission of Matters to a Vote of Security
Holders
Information
from Item 4 of Part II of Form 10-Q
|
Securities
Administrator
|
|
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
|
EXH-V-2
|
ADDITIONAL
FORM 10-D DISCLOSURE
|
|
|
Item
on Form 10-D
|
Party
Responsible
|
|
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
|
EXH-V-3
EXHIBIT
W
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-K if 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-K if updated
information
is required pursuant to the Item.
|
|
|
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-K if updated
information
is required pursuant to the Item.
|
|
EXH-W-1
|
ADDITIONAL
FORM 10-K DISCLOSURE
|
|
|
Item
on Form 10-K
|
Party
Responsible
|
|
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)
|
Master
Servicer, Securities Administrator, Servicer 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
|
|
▪
Servicer
|
Servicer
|
|
▪
Custodian
|
Custodian
|
|
▪
1110(b) Originator
|
Depositor
|
|
▪
Any 1108(a)(2) Servicer (other than the Servicer, 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
|
|
▪
Servicer
|
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 Derivative Counterparty Provider
|
Depositor/Sponsor
|
|
▪
Any other 1101(d)(1) material party
|
Depositor/Sponsor
|
EXH-W-2
|
ADDITIONAL
FORM 10-K DISCLOSURE
|
|
|
Item
on Form 10-K
|
Party
Responsible
|
|
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
|
|
▪
Servicer
|
Servicer
|
|
▪
Securities Administrator
|
Securities
Administrator
|
|
▪
Trustee
|
Depositor/Sponsor
|
|
▪
Any other 1108(a)(3) servicer
|
Depositor/Sponsor
|
|
▪
Any 1110 Originator
|
Depositor/Sponsor
|
|
▪
Any 1112(b) Significant Obligor
|
Depositor/Sponsor
|
|
▪
Any 1114 Credit Enhancement Provider
|
Depositor/Sponsor
|
|
▪
Any 1115 Derivative 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
|
|
▪
Servicer
|
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
|
EXH-W-3
EXHIBIT
X
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 other than the Trustee
|
|
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 other than the Trustee
|
|
Item
1.03- Bankruptcy or Receivership
Disclosure
is required regarding the bankruptcy or receivership, with respect
to any
of the following:
|
Depositor
|
|
▪
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
|
EXH-X-1
|
FORM
8-K DISCLOSURE INFORMATION
|
|
|
Item
on Form 8-K
|
Party
Responsible
|
|
▪
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
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
|
|
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
|
EXH-X-2
|
FORM
8-K DISCLOSURE INFORMATION
|
|
|
Item
on Form 8-K
|
Party
Responsible
|
|
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
|
|
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 other than the Trustee
|
|
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
|
EXH-X-3
EXHIBIT
Y
ADDITIONAL
DISCLOSURE NOTIFICATION
**SEND
TO ▇▇▇▇▇ FARGO VIA FAX TO ▇▇▇-▇▇▇-▇▇▇▇ AND VIA EMAIL TO
▇▇▇.▇▇▇.▇▇▇▇▇▇▇▇▇▇▇▇▇@▇▇▇▇▇▇▇▇▇▇.▇▇▇ AND VIA OVERNIGHT MAIL TO THE ADDRESS
IMMEDIATELY BELOW. SEND TO THE DEPOSITOR AT THE ADDRESS
BELOW**
▇▇▇▇▇
Fargo Bank, N.A.
as
Securities Administrator
▇▇▇▇
▇▇▇
▇▇▇▇▇▇▇▇▇ ▇▇▇▇
▇▇▇▇▇▇▇▇,
▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Fax:
(▇▇▇) ▇▇▇-▇▇▇▇
E-mail:
▇▇▇.▇▇▇.▇▇▇▇▇▇▇▇▇▇▇▇▇@▇▇▇▇▇▇▇▇▇▇.▇▇▇
HSI
Asset
Securitization Corporation
▇▇▇
▇▇▇▇▇
▇▇▇▇▇▇
▇▇▇
▇▇▇▇,
▇▇▇ ▇▇▇▇ ▇▇▇▇▇
Attention:
Head MBS Principal Finance
Attn:
Client Manager-HASCO 2007-WF1-SEC REPORT PROCESSING
RE:
**Additional Form [ ] Disclosure**Required
Ladies
and Gentlemen:
In
accordance with Section 8.12 of the Pooling and Servicing Agreement, dated
as of
June 1, 2007 (the “Pooling
and Servicing Agreement”),
among
HSI Asset Securitization Corporation, as depositor (the “Depositor”),
▇▇▇▇▇
Fargo Bank, N.A., as originator, as servicer, as master servicer (the
“Master
Servicer”),
as
securities administrator (the “Securities
Administrator”)
and as
custodian, OfficeTiger Global Real Estate Services Inc., as credit risk
manager,
and Deutsche Bank National Trust Company, as trustee. The Undersigned,
as [ ],
hereby notifies you that certain events have come to our attention that
[will][may] need to be disclosed on Form [ ].
Description
of Additional Form [ ] Disclosure:
List
of
Any Attachments hereto to be included in the Additional Form [ ]
Disclosure:
Any
inquiries related to this notification should be directed to [ ], phone
number:
[ ]; email address: [ ].
EXH-Y-1
[NAME
OF
PARTY]
as
[role]
By:
__________________
Name:
Title:
EXH-Y-2