MORGAN STANLEY CAPITAL I INC. Depositor and LASALLE BANK NATIONAL ASSOCIATION Trustee TRUST AGREEMENT Dated as of October 1, 2006 MORGAN STANLEY MORTGAGE LOAN TRUST 2006-14SL MORTGAGE PASS-THROUGH CERTIFICATES, SERIES 2006-14SL
EXECUTION
XXXXXX
XXXXXXX CAPITAL I INC.
Depositor
and
LASALLE
BANK NATIONAL ASSOCIATION
Trustee
___________________________
Dated
as
of October 1, 2006
___________________________
XXXXXX
XXXXXXX MORTGAGE LOAN TRUST 2006-14SL
MORTGAGE
PASS-THROUGH CERTIFICATES, SERIES 2006-14SL
TABLE
OF
CONTENTS
Page
|
ARTICLE
I DEFINITIONS
|
2
|
|
|
Section
1.01
|
Definitions.
|
2
|
|
ARTICLE
II DECLARATION OF TRUST; ISSUANCE OF CERTIFICATES
|
36
|
|
|
Section
2.01
|
Creation
and Declaration of Trust Fund; Conveyance of Mortgage
Loans.
|
36
|
|
Section
2.02
|
Acceptance
of Trust Fund by Trustee; Review of Documentation for Trust
Fund.
|
39
|
|
Section
2.03
|
Representations
and Warranties of the Depositor.
|
39
|
|
Section
2.04
|
Representations
and Warranties of the Depositor and the Seller as to the Mortgage
Loans.
|
41
|
|
Section
2.05
|
Representations
and Warranties of the Seller; Discovery of Breach; Repurchase or
Substitution of Mortgage Loans.
|
42
|
|
Section
2.06
|
Grant
Clause.
|
46
|
|
ARTICLE
III THE CERTIFICATES
|
47
|
|
|
Section
3.01
|
The
Certificates.
|
47
|
|
Section
3.02
|
Registration.
|
48
|
|
Section
3.03
|
Transfer
and Exchange of Certificates.
|
48
|
|
Section
3.04
|
Cancellation
of Certificates.
|
51
|
|
Section
3.05
|
Replacement
of Certificates.
|
52
|
|
Section
3.06
|
Persons
Deemed Owners.
|
52
|
|
Section
3.07
|
Temporary
Certificates.
|
52
|
|
Section
3.08
|
Appointment
of Paying Agent.
|
53
|
|
Section
3.09
|
Book-Entry
Certificates.
|
53
|
|
ARTICLE
IV ADMINISTRATION OF THE TRUST FUND
|
54
|
|
|
Section
4.01
|
Custodial
Accounts; Distribution Account.
|
54
|
|
Section
4.02
|
Permitted
Withdrawals from the Distribution Account.
|
56
|
|
Section
4.03
|
Enforcement
of Servicer’s Obligations.
|
56
|
|
Section
4.04
|
Reports
to Certificateholders.
|
57
|
|
Section
4.05
|
Annual
Statement of Compliance.
|
60
|
|
Section
4.06
|
Regulation
AB Compliance, Intent of the Parties; Reasonableness.
|
61
|
|
ARTICLE
V DISTRIBUTIONS TO HOLDERS OF CERTIFICATES
|
61
|
|
|
Section
5.01
|
Distributions
Generally.
|
61
|
|
Section
5.02
|
Priorities
of Distribution.
|
62
|
|
Section
5.03
|
Allocation
of Losses.
|
65
|
|
Section
5.04
|
Determination
of Pass-Through Rates for LIBOR Certificates.
|
66
|
|
ARTICLE
VI CONCERNING THE TRUSTEE; EVENTS OF DEFAULT
|
69
|
|
|
Section
6.01
|
Duties
of Trustee.
|
69
|
|
Section
6.02
|
Certain
Matters Affecting the Trustee.
|
71
|
|
Section
6.03
|
Trustee
Not Liable for Certificates.
|
72
|
|
Section
6.04
|
Trustee
May Own Certificates.
|
72
|
|
Section
6.05
|
Eligibility
Requirements for Trustee.
|
73
|
|
Section
6.06
|
Resignation
and Removal of Trustee.
|
73
|
|
Section
6.07
|
Successor
Trustee.
|
74
|
|
Section
6.08
|
Merger
or Consolidation of Trustee.
|
75
|
|
Section
6.09
|
Appointment
of Co-Trustee, Separate Trustee or Custodian.
|
75
|
|
Section
6.10
|
Authenticating
Agents.
|
76
|
|
Section
6.11
|
Indemnification
of the Trustee.
|
77
|
|
Section
6.12
|
Fees
and Expenses of the Trustee.
|
78
|
|
Section
6.13
|
Collection
of Monies.
|
78
|
|
Section
6.14
|
Periodic
Filings
|
78
|
|
ARTICLE
VII PURCHASE OF MORTGAGE LOANS AND TERMINATION OF THE TRUST
FUND
|
84
|
|
|
Section
7.01
|
Purchase
of Mortgage Loans; Termination of Trust Fund Upon Purchase or Liquidation
of All Mortgage Loans.
|
84
|
|
Section
7.02
|
Procedure
Upon Redemption of Trust Fund.
|
85
|
|
Section
7.03
|
Additional
Trust Fund Termination Requirements.
|
86
|
|
Section
7.04
|
Charged-off
Loans and Released Mortgage Loans.
|
87
|
|
ARTICLE
VIII RIGHTS OF CERTIFICATEHOLDERS
|
88
|
|
|
Section
8.01
|
Limitation
on Rights of Holders.
|
88
|
|
Section
8.02
|
Access
to List of Holders.
|
88
|
|
Section
8.03
|
Acts
of Holders of Certificates.
|
89
|
|
ARTICLE
IX REMIC ADMINISTRATION
|
90
|
|
|
Section
9.01
|
REMIC
Administration.
|
90
|
|
Section
9.02
|
Prohibited
Transactions and Activities.
|
92
|
|
Section
9.03
|
Indemnification
with Respect to Prohibited Transactions or Loss of REMIC
Status.
|
93
|
|
Section
9.04
|
REO
Property.
|
93
|
|
ARTICLE
X MISCELLANEOUS PROVISIONS
|
94
|
|
|
Section
10.01
|
Binding
Nature of Agreement; Assignment.
|
94
|
|
Section
10.02
|
Entire
Agreement.
|
94
|
|
Section
10.03
|
Amendment.
|
94
|
|
Section
10.04
|
Voting
Rights.
|
95
|
|
Section
10.05
|
Provision
of Information.
|
95
|
|
Section
10.06
|
Governing
Law.
|
96
|
ii
|
Section
10.07
|
Notices.
|
96
|
|
Section
10.08
|
Severability
of Provisions.
|
96
|
|
Section
10.09
|
Indulgences;
No Waivers.
|
97
|
|
Section
10.10
|
Headings
Not To Affect Interpretation.
|
97
|
|
Section
10.11
|
Benefits
of Agreement.
|
97
|
|
Section
10.12
|
Special
Notices to the Rating Agencies.
|
97
|
|
Section
10.13
|
Conflicts.
|
98
|
|
Section
10.14
|
Counterparts.
|
98
|
|
Section
10.15
|
No
Petitions.
|
98
|
|
Section
10.16
|
Indemnification
by Trust.
|
98
|
iii
ATTACHMENTS
|
Exhibit
A
|
Forms
of Certificates
|
|
Exhibit
B
|
Form
of Residual Certificate Transfer Affidavit (Transferee)
|
|
Exhibit
C
|
Form
of Residual Certificate Transfer Affidavit (Transferor)
|
|
Exhibit
D
|
[Reserved]
|
|
Exhibit
E
|
List
of Purchase Agreements and Servicing Agreements
|
|
Exhibit
F
|
List
of Custodial Agreements
|
|
Exhibit
G
|
[Reserved]
|
|
Exhibit
H
|
Form
of Rule 144A Transfer Certificate
|
|
Exhibit
I
|
Form
of Purchaser’s Letter for Institutional Accredited
Investors
|
|
Exhibit
J
|
Form
of ERISA Transfer Affidavit
|
|
Exhibit
K
|
Form
of Letter of Representations with the Depository Trust
Company
|
|
Exhibit
L
|
Form
of Certificates to be Provided with Form 10-K
|
|
Exhibit
M
|
Form
of Certification to be provided by the Trustee to the
Depositor
|
|
Exhibit
N
|
Servicing
Criteria to be Addressed in Assessment of Compliance
|
|
Exhibit
O
|
Additional
Form 10-D Disclosure
|
|
Exhibit
P
|
Additional
Form 10-K Disclosure
|
|
Exhibit
Q
|
Form
8-K Disclosure Information
|
|
Schedule
A
|
Mortgage
Loan Schedule
|
|
Schedule
B
|
Principal
Balances Schedule
|
iv
This
TRUST AGREEMENT dated as of October 1, 2006 (the “Agreement”),
is
between XXXXXX XXXXXXX CAPITAL I INC., a Delaware corporation, as depositor
(the
“Depositor”)
and
LASALLE BANK NATIONAL ASSOCIATION, a national banking association, as trustee
(the “Trustee”)
and
acknowledged by XXXXXX XXXXXXX MORTGAGE CAPITAL INC., a New York corporation,
as
seller (the “Seller”),
for
purposes of Section 2.05.
WITNESSETH
THAT
In
consideration of the mutual agreements herein contained, the parties hereto
agree as follows:
PRELIMINARY
STATEMENT
The
Depositor is the owner of the Trust Fund that is hereby conveyed to the Trustee
in return for the Certificates. As provided herein, the Trustee will make
multiple elections to treat a segregated pool of assets subject to this
Agreement for federal income tax purposes as the following two separate real
estate mortgage investment conduits (each, a “REMIC”):
the
Subsidiary REMIC and the Master REMIC. The Subsidiary REMIC will consist of
the
Mortgage Loans. The Subsidiary REMIC will issue the uncertificated REMIC regular
interests specified below (each, a “Subsidiary
REMIC Regular Interest”).
The
Subsidiary REMIC Regular Interests will represent the “regular interests” in the
Subsidiary REMIC and the Class SR Interest will represent the single Class
of
“residual interest” in the Subsidiary REMIC.
The
Trustee will hold the Subsidiary REMIC Regular Interest for the benefit of
the
Master REMIC. The Master REMIC will consist of the Subsidiary REMIC Interests
and will be evidenced by the Certificates (other than the Class R Certificates),
which will constitute the regular interests in the Master REMIC (the
“Regular
Certificates”)
and
the Class MR Interest, which will represent the single Class of “residual
interest” in the Master REMIC. The Class R Certificates will represent the
beneficial ownership of each of the Class SR and Class MR Interests. The
“latest
possible maturity date”
for
federal income tax purposes of all REMICs, and regular and residual interests
created hereunder will be the Latest Possible Maturity Date.
Subsidiary
REMIC
The
Subsidiary REMIC Interests, each of which (except for the Class SR Interest)
is
hereby designated as a REMIC regular interest for federal income tax purposes,
will have the principal balances, pass-through rates and Corresponding Master
REMIC Certificates as set forth in the following table:
|
Subsidiary
REMIC Interest
|
Initial
Principal Balance
|
Interest
Rate
|
Corresponding
Master REMIC Certificate
|
|
S-A-1
|
(1)
|
(2)
|
Class
A-1
|
|
S-M-1
|
(1)
|
(2)
|
Class M-1
|
|
S-M-2
|
(1)
|
(2)
|
Class M-2
|
|
S-M-3
|
(1)
|
(2)
|
Class M-3
|
|
S-M-4
|
(1)
|
(2)
|
Class M-4
|
|
S-B-1
|
(1)
|
(2)
|
Class B-1
|
|
S-B-2
|
(1)
|
(2)
|
Class B-2
|
|
S-B-3
|
(1)
|
(2)
|
Class B-3
|
|
S-B-4
|
(1)
|
(2)
|
Class B-4
|
|
S-B-5
|
(1)
|
(2)
|
Class
B-5
|
|
S-Accrual
|
(1)
|
(2)(3)
|
N/A
|
|
SR
|
(4)
|
(4)
|
N/A
|
_______________
|
(1)
|
For
each Distribution Date, following the allocation of scheduled principal,
prepayments and Realized Losses: (i) each such Class of Interests
(other
than the Class S-Accrual Interest) will have a principal balance
equal to
50% of the principal balance in respect of the Corresponding Master
REMIC
Certificates, and (ii) the Class S-Accrual Interest will have a principal
balance equal to 50% of the principal balance of Mortgage Loans plus
50%
of the Overcollateralized Amount.
|
|
(2)
|
The
interest rate with respect to any Distribution Date (and the related
Interest Accrual Period) for this REMIC Interest is a per annum rate
equal
to the Weighted Average Net Mortgage Rate of the Mortgage
Loans.
|
|
(3)
|
The
Class S-Accrual Interest will also be entitled to 100% of any prepayment
premiums paid on the Mortgage Loans.
|
|
(4)
|
The
SR Interest is the sole Class of residual interest in the Subsidiary
REMIC. It pays no interest or
principal.
|
The
Master REMIC
The
following table sets forth characteristics of the Master REMIC Certificates,
together with the minimum denominations and integral multiples in excess thereof
in which such Classes shall be issuable (except that one Certificate of each
Class of Certificates may be issued in a different amount and, in addition,
one
Residual Certificate representing the Tax Matters Person Certificate may be
issued in a different amount):
|
Class
Designation
|
Initial
Class Principal Balance
|
Pass-Through
Rate
(per
annum)
|
Minimum
Denomination(3)
|
Integral
Multiples in Excess of Minimum(3)
|
|
Class
A-1
|
$234,162,000.00
|
(1)
|
$25,000.00
|
$1,000.00
|
|
Class
M-1
|
$35,929,000.00
|
(1)
|
$25,000.00
|
$1,000.00
|
|
Class
M-2
|
$6,902,000.00
|
(1)
|
$25,000.00
|
$1,000.00
|
|
Class
M-3
|
$19,469,000.00
|
(1)
|
$25,000.00
|
$1,000.00
|
|
Class
M-4
|
$6,017,000.00
|
(1)
|
$25,000.00
|
$1,000.00
|
|
Class
B-1
|
$8,495,000.00
|
(1)
|
$25,000.00
|
$1,000.00
|
|
Class
B-2
|
$5,663,000.00
|
(1)
|
$25,000.00
|
$1,000.00
|
|
Class
B-3
|
$4,601,000.00
|
(1)
|
$25,000.00
|
$1,000.00
|
|
Class
B-4
|
$5,663,000.00
|
(2)
|
$100,000.00
|
$1,000.00
|
|
Class
B-5
|
$4,430,864.00
|
(2)
|
$100,000.00
|
$1,000.00
|
|
Class
P
|
$100.00
|
(4)
|
$100.00
|
N/A
|
|
Class
OC
|
(5)
|
(6)
|
(7)
|
(7)
|
|
Class R(8)
|
$0.00
|
(9)
|
(10)
|
(10)
|
__________________________________________
|
(1)
|
Interest
will accrue on each such Class of Certificates during each Interest
Accrual Period at a rate equal to the lesser of (x) LIBOR plus the
Pass-Through Margin for such Class for such Distribution Date and
(y) the
Net WAC Cap for such Distribution
Date.
|
vi
|
(2)
|
Interest
will accrue on each such Class of Certificates during each Interest
Accrual Period for each Distribution Date (i) occurring on or prior
to the
Initial Optimal Purchase Date at a rate equal to 7.000% per annum
and (ii)
occurring after the Initial Optimal Purchase Date at a rate equal
to
7.500% per annum.
|
|
(3)
|
The
minimum dollar denomination for any Certificate purchased by any
Person
within a Member State of the European Economic Area shall be
$100,000.
|
|
(4)
|
The
Class P Certificates will not be entitled to any interest, but will
be
entitled to 100% of any prepayment premiums paid on the Mortgage
Loans.
|
|
(5)
|
The
Class Principal Balance of the Class OC Certificates for any Distribution
Date shall be equal to (x) the aggregate Stated Principal Balances
of the
Mortgage Loans as of such Distribution Date, minus (y) the aggregate
Class
Principal Balances of the other Certificates as of such Distribution
Date.
For purposes of compliance with the REMIC Provisions, the Class OC
Certificates shall have an initial Certificate Balance equal to the
Overcollateralized Amount as of the Closing
Date.
|
|
(6)
|
For
each Interest Accrual Period the Class OC Certificates shall accrue
a
specified portion of the interest on the Subsidiary REMIC Regular
Interests equal to the excess of the Weighted Average Net Mortgage
Rate of
the Mortgage Loans over the product of two and the weighted average
interest rate of the Subsidiary REMIC Regular Interests having “(1)”
designated in the column entitled “Initial Principal Balance” with each
such Class other than the Class S-Accrual Interest subject to a cap
equal
to the Pass-Through Rate of the Corresponding Master REMIC Class
and the
S-Accrual Interest subject to a cap of 0.00%. The Pass-Through Rate
of the
Class OC Certificates shall be a rate sufficient to entitle it to
all
interest accrued on the Mortgage Loans less the interest accrued
on the
other interests issued by the Master REMIC. The Class OC Distributable
Amount for any Distribution Date is payable from current interest
on the
Mortgage Loans and any OC Release Amount for that Distribution
Date.
|
|
(7)
|
The
Class OC Certificates will be issued as a single Class of
Certificates.
|
|
(8)
|
The
Class R Certificates represent beneficial ownership of the sole Class
of
residual interest in each REMIC.
|
|
(9)
|
The
Class R Certificates shall not be entitled to any
interest.
|
|
(10)
|
The
Class R Certificate shall be issued as two separate certificates,
one with
an initial Percentage Interest of 99.99% and the Tax Matters Person
Certificate with an initial Percentage Interest of
0.01%.
|
The
foregoing provisions in the Preliminary Statement are intended to cause net
interest and principal collections in respect of the Mortgage Loans to be
distributed from the Subsidiary REMIC to the Master REMIC and from the Master
REMIC to each Class of Certificates. The Preliminary Statement will be
interpreted and applied consistently with such intent.
For
any
purpose for which the Pass-Through Rate is calculated, the interest rate on
the
Mortgage Loans shall be appropriately adjusted to account for the difference
between the monthly day count convention of the Mortgage Loans and the monthly
day count convention of the regular interests issued by each of the REMICs.
For
purposes of calculating the pass-through rates for each of the interests issued
by the Subsidiary REMIC and the Master REMIC such rates shall be adjusted to
equal a monthly day count convention based on the actual number of days elapsed
in each Due Period and a 360-day year so that the Mortgage Loans and all regular
interests will be using the same monthly day count convention.
vii
Set
forth
below are designations of Classes or Components of Certificates and other
defined terms to the categories used herein:
|
Book-Entry
Certificates.
|
All
Classes of Certificates other than the Definitive Certificates.
|
|
Delay
Certificates
|
Fixed
Rate Certificates.
|
|
ERISA-Restricted
Certificates.
|
The
Residual Certificates and Private Certificates; and any Certificate
of a
Class that ceases to satisfy the applicable rating requirement under
the Underwriter’s Exemption.
|
|
Fixed
Rate Certificates.
|
Class
B-4 and Class B-5 Certificates.
|
|
Floating
Rate Certificates.
|
LIBOR
Certificates.
|
|
LIBOR
Certificates
|
Class
A-1, Class M-1, Class M-2, Class M-3, Class M-4, Class B-1, Class
B-2 and
Class B-3 Certificates.
|
|
Non-Delay
Certificates
|
LIBOR
Certificates.
|
|
Offered
Certificates
|
All
Classes of Certificates other than the Private Certificates.
|
|
Definitive
Certificates
|
Private
Certificates.
|
|
Private
Certificates
|
Class
R, Class P, Class OC, Class B-4 and Class B-5 Certificates.
|
|
Rating
Agencies
|
S&P
and Xxxxx’x.
|
|
Regular
Certificates
|
All
Classes of Certificates, other than the Residual Certificates.
|
|
Residual
Certificates.
|
Class
R Certificates.
|
|
Senior
Certificates
|
Class
A-1 Certificates.
|
|
Subordinated
Certificates
|
Class M-1,
Class M-2, Class M-3, Class M-4, Class B-1, Class B-2, Class B-3,
Class
B-4 and Class B-5 Certificates.
|
|
Underwriter
|
Xxxxxx
Xxxxxxx & Co. Incorporated.
|
Defined
terms and provisions herein relating to statistical rating agencies not
designated above as Rating Agencies shall be of no force or effect.
ARTICLE
I
DEFINITIONS
Section
1.01 Definitions.
The
following words and phrases, unless the context otherwise requires, shall have
the following meanings:
Aames:
Aames
Capital Corporation.
Aames
Mortgage Loan:
Each
Mortgage Loan originated by Aames and listed on the Mortgage Loan Schedule.
Aames
Purchase Agreement:
The
Third Amended and Restated Mortgage Loan Purchase and Warranties Agreement
dated
as of March 1, 2006, listed in Exhibit E hereto and each between the Seller
and
Aames.
Accountant:
A
Person engaged in the practice of accounting who (except when this Agreement
provides that an Accountant must be Independent) may be employed by or
affiliated with the Depositor or an Affiliate of the Depositor.
Acknowledgements:
The
Assignment, Assumption and Recognition Agreements, each dated as of October
1,
2006, assigning rights under the Purchase Agreements and the Servicing
Agreements from the Seller to the Depositor and from the Depositor to the
Trustee, for the benefit of the Certificateholders.
Adverse
REMIC Event:
Either
(i) loss of status as a REMIC, within the meaning of Section 860D of
the Code, for any group of assets identified as a REMIC in the Preliminary
Statement to this Agreement, or (ii) imposition of any tax, including the
tax imposed under Section 860F(a)(1) on prohibited transactions, and the
tax imposed under Section 860G(d) on certain contributions to a REMIC, on
any REMIC created hereunder to the extent such tax would be payable from assets
held as part of the Trust Fund.
Aegis:
Aegis
Mortgage Corporation.
Aegis
Mortgage Loan:
Each
Mortgage Loan originated by Aegis and listed on the Mortgage Loan Schedule.
Aegis
Purchase Agreement:
Collectively, the Seller Agreement dated July 28, 2004 and the Flow Addendum
to
Seller Agreement dated as of April 6, 2005, each listed in Exhibit E hereto
and
each between the Seller and Aegis.
Affiliate:
With
respect to any specified Person, any other Person controlling or controlled
by
or under common control with such specified Person. For the purposes of this
definition, “control” when used with respect to any specified Person 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.
2
Agreement:
This
Trust Agreement and all amendments or supplements hereto.
Applied
Loss Amount:
As to
any Distribution Date, with respect to the Class X-0, Xxxxx X-0, Class M-3,
Class M-4, Class B-1, Class B-2, Class B-3, Class B-4 and Class B-5
Certificates, the excess, if any, of (i) the aggregate Class Principal Balances
of the Class A-1, Class M-1, Class M-2, Class M-3, Class M-4, Class B-1, Class
B-2, Class B-3, Class B-4 and Class B-5 Certificates, after giving effect
to all Realized Losses during the Due Period for such Distribution Date and
payments of principal on such Distribution Date over (ii) the aggregate Stated
Principal Balance of the Mortgage Loans for such Distribution Date.
Appraised
Value:
With
respect to any Mortgage Loan, the Appraised Value of the related Mortgaged
Property shall be: (i) with respect to a Mortgage Loan other than a
Refinancing Mortgage Loan, the lesser of (a) the value of the Mortgaged
Property based upon the appraisal made at the time of the origination of such
Mortgage Loan and (b) the sales price of the Mortgaged Property at the time
of the origination of such Mortgage Loan; and (ii) with respect to a
Refinancing Mortgage Loan, the value of the Mortgaged Property based upon the
appraisal made at the time of the origination of such Refinancing Mortgage
Loan.
Assignment
of Mortgage:
An
assignment of the Mortgage, notice of transfer or equivalent instrument, in
recordable form, sufficient under the laws of the jurisdiction wherein the
related Mortgaged Property is located to reflect the sale of the Mortgage to
the
Trustee, which assignment, notice of transfer or equivalent instrument may
be in
the form of one or more blanket assignments covering the Mortgage Loans secured
by Mortgaged Properties located in the same jurisdiction, if permitted by law;
provided,
however,
that
neither the Trustee nor the related Custodian shall be responsible for
determining whether any such assignment is in recordable form or sufficient
under the laws of the applicable jurisdiction to reflect the sale of the
Mortgage to the Trustee.
Assignment
of Proprietary Lease:
With
respect to a Cooperative Loan, an assignment of the Proprietary Lease sufficient
under the laws of the jurisdiction wherein the related Cooperative Unit is
located to reflect the assignment of such Proprietary Lease; provided,
however,
that
neither the Trustee nor the related Custodian shall be responsible for
determining whether such assignment is sufficient to reflect the assignment
of
the Proprietary Lease.
Assignment
of Recognition Agreement:
With
respect to a Cooperative Loan, an assignment of the Recognition Agreement
sufficient under the laws of the jurisdiction wherein the related Cooperative
Unit is located to reflect the assignment of such Recognition Agreement;
provided,
however,
that
the neither the Trustee nor the related Custodian shall be responsible for
determining whether such assignment is sufficient to reflect the assignment
of
the Recognition Agreement.
Auction
Administrator:
The
Trustee, or any successor in interest, or if any successor trustee shall be
appointed as herein provided, then such successor trustee.
3
Auction
Date:
As
defined in Section 7.01(b).
Auction
Purchaser:
As
defined in Section 7.01(b).
Auction
Sale:
As
defined in Section 7.01(b).
Authenticating
Agent:
Any
authenticating agent appointed pursuant to Section 6.10 until any successor
authenticating agent for the Certificates is named, and thereafter
“Authenticating Agent” shall mean any such successor. The initial Authenticating
Agent shall be the Trustee under this Agreement.
Authorized
Officer:
Any
Person who may execute an Officer’s Certificate on behalf of the
Depositor.
Available
Distribution Amount:
For any
Distribution Date, the sum of the following amounts:
(1) the
total
amount of all cash received by or on behalf of the Servicer with respect to
the
Mortgage Loans or received by the Trustee by such Distribution Date and not
previously distributed (including Liquidation Proceeds, condemnation proceeds
and Insurance Proceeds), except:
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all
scheduled payments of principal and related interest collected on
the
Mortgage Loans but due on a date after the related Due
Date;
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all
partial Principal Prepayments received with respect to the Mortgage
Loans
after the related Prepayment Period, together with all related interest
accrued on such Mortgage Loans;
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all
Prepayment Penalties received in connection with the Mortgage
Loans;
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all
Principal Prepayments in full received with respect to the Mortgage
Loans
after the related Prepayment Period, together with all related interest
accrued on such Mortgage Loans;
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Liquidation
Proceeds, condemnation proceeds and Insurance Proceeds received on
the
Mortgage Loans after the previous calendar
month;
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all
amounts reimbursable or payable to the Servicer pursuant to the terms
of
the Servicing Agreement or to the Trustee and/or the Custodians pursuant
to the terms of this Agreement or the Custodial Agreements (which
shall,
in each case, reduce the Interest Remittance Amount before reducing
the
principal portion of the Available Distribution
Amount);
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reinvestment
income on the balance of funds, if any, in the Custodial Accounts
or
Distribution Account;
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any
fees payable to the Servicer (which
shall reduce the Interest Remittance Amount before reducing the principal
portion of the Available Distribution Amount);
and
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the
Class P Distribution Amount.
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(2) all
P&I Advances on the Mortgage Loans made by the Servicer for that
Distribution Date;
(3) any
Compensating Interest Payments with respect to the Mortgage Loans for that
Distribution Date;
(4) the
total
amount of any cash deposited in the distribution account in connection with
the
repurchase of any Mortgage Loans by the Seller pursuant to this Agreement or
the
Mortgage Loan Purchase Agreement or the related Originator pursuant to the
related Acknowledgement; and
(5) all
Subsequent Recoveries received by the Servicer with respect to the Mortgage
Loans during the related Prepayment Period.
Bankruptcy:
As to
any Person, the making of an assignment for the benefit of creditors, the filing
of a voluntary petition in bankruptcy, adjudication as a bankrupt or insolvent,
the entry of an order for relief in a bankruptcy or insolvency proceeding,
the
seeking of reorganization, arrangement, composition, readjustment, liquidation,
dissolution or similar relief, or seeking, consenting to or acquiescing in
the
appointment of a trustee, receiver or liquidator, dissolution, or termination,
as the case may be, of such Person pursuant to the provisions of either the
Bankruptcy Code or any other similar state laws.
Bankruptcy
Code:
The
United States Bankruptcy Code of 1986, as amended.
Basis
Risk Carry Forward Amount:
With
respect to any Class of LIBOR Certificates and any Distribution Date on which
the Pass-Through Rate for that Class of Certificates is limited to the Net
WAC
Cap, an amount equal to the sum of (i) the excess of (x) the amount of interest
such Class of Certificates would have been entitled to receive on such
Distribution Date at the related Pass-Through Rate (calculated for this purpose
without regard to the Net WAC Cap for such Distribution Date) over (y) the
amount of interest accrued on such Distribution Date at the Net WAC Cap plus
(ii) the related Basis Risk Carry Forward Amount for the previous Distribution
Date not previously distributed together with interest thereon at a rate equal
to the related Pass-Through Rate (calculated for this purpose without regard
to
the Net WAC Cap) for such Class of Certificates for the most recently ended
Interest Accrual Period.
Book-Entry
Certificates:
Beneficial interests in Certificates designated as “Book-Entry Certificates” in
this Agreement, ownership and transfers of which shall be evidenced or made
through book entries by a Clearing Agency as described in Section 3.09;
provided,
that
after
the occurrence of a Book-Entry Termination whereupon book-entry registration
and
transfer are no longer permitted and Definitive Certificates are to be issued
to
Certificate Owners, such Book-Entry Certificates shall no longer be “Book-Entry
Certificates.” The Classes of Certificates that constitute “Book-Entry
Certificates” as of the Closing Date are set forth in the Preliminary
Statement.
5
Book-Entry
Termination:
The
date on which the Clearing Agency is no longer willing or able to properly
discharge its responsibilities with respect to the Book Entry Certificates,
and
the Depositor is unable to locate a qualified successor.
Business
Day:
Any day
other than (i) a Saturday or a Sunday or (ii) a day on which banks of
any of the states of California, New York, New Jersey or any other state in
which the Corporate Trust Office of the Trustee is located, are authorized
or
obligated by law or executive order to be closed.
Certificate:
Any one
of the certificates signed by the Trustee and authenticated by the Trustee
as
Authenticating Agent in substantially the forms attached hereto as
Exhibit A.
Certificate
Balance:
With
respect to any Certificate other than a Class OC 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 principal balance as of the Closing
Date (A) plus any Subsequent Recoveries added to the Certificate Balance of
such
Certificate pursuant to Section 5.03, (B) minus
the sum
of (i) all distributions of principal previously made with respect thereto
and
(ii) with respect to the Subordinated Certificates only, all Applied Loss
Amounts allocated thereto and all other reductions in Certificate Balance
previously allocated thereto pursuant to Section 5.03.
Certificate
Owner:
With
respect to a Book-Entry Certificate, the Person who is the owner of such
Book-Entry Certificate, as reflected on the books of the Clearing Agency, or
on
the books of a Person maintaining an account with such Clearing Agency (directly
or as an indirect participant, in accordance with the rules of such Clearing
Agency).
Certificate
Register and Certificate Registrar:
The
register maintained and the registrar appointed pursuant to Section 3.02.
The initial Certificate Registrar is the Trustee under this
Agreement.
Certificateholder:
The
meaning provided in the definition of “Holder.”
Charged-off
Loan:
As of
any date of determination, any Mortgage Loan that was delinquent in payment
for
a period of 180 days or more as of the last calendar day of the month
immediately preceding the month in which such date of determination occurs,
without giving effect to any grace period permitted by the related Mortgage
Note, provided, however, that with respect to any such Mortgage Loan, (i) an
equity analysis performed by the Servicer supports charge-off over foreclosure,
(ii) the related Mortgaged Property has not become REO Property, (iii) there
are
no active foreclosure or other loss mitigation activities and (iv) nothing
has
come to the attention of the Servicer indicating that any such Mortgage Loan,
at
the time of its origination, violated any applicable federal, state or local
law
or regulation, including, without limitation, usury, truth-in-lending, consumer
credit protection and privacy, equal credit opportunity, disclosure or predatory
and abusive lending laws, applicable to the origination and servicing of such
Mortgage Loan.
6
Class:
All
Certificates bearing the same Class designation as set forth in the Preliminary
Statement.
Class
A Interest Distribution Amount:
For the
Senior Certificates and any Distribution Date, the sum of (x) interest accrued
on the Class Principal Balance for such Distribution Date for the Senior
Certificates and (y) Interest Carry Forward Amounts, if any, for such
Distribution Date for the Senior Certificates.
Class
A Principal Distribution Amount:
With
respect to any Distribution Date (i) prior to the Stepdown Date or on or after
the Stepdown Date if a Trigger Event is in effect, the Principal Distribution
Amount or (ii) on or after the Stepdown Date if a Trigger Event is not in effect
for that Distribution Date, the lesser of:
· the
Principal Distribution Amount for that Distribution Date; and
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the
excess (if any) of (A) the aggregate Class Principal Balance of the
Senior
Certificates immediately prior to that Distribution Date over (B)
the
lesser of (i) the aggregate Stated Principal Balance of the Mortgage
Loans
as of the last day of the related Due Period multiplied by 32.30%
and (ii)
the amount, if any, by which (x) the aggregate Stated Principal Balance
of
the Mortgage Loans as of the last day of the related Due Period exceeds
(y) the Overcollateralization Target
Amount.
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Class
B Certificates:
The
Class B-1, Class B-2, Class B-3, Class B-4 and Class B-5
Certificates.
Class
B-1 Principal Distribution Amount:
With
respect to the Class B-1 Certificates and any Distribution Date (i) prior to
the
Stepdown Date or on or after the Stepdown Date if a Trigger Event is in effect
for that Distribution Date, the Principal Distribution Amount for that
Distribution Date remaining after distribution of the Class A Principal
Distribution Amount, the Class M-1 Principal Distribution Amount, the Class
M-2
Principal Distribution Amount, the Class M-3 Principal Distribution Amount
and
the Class M-4 Principal Distribution Amount, or (ii) on or after the Stepdown
Date if a Trigger Event is not in effect for that Distribution Date, the lesser
of:
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the
Principal Distribution Amount for that Distribution Date remaining
after
distribution of the Class A Principal Distribution Amount, the Class
M-1
Principal Distribution Amount, the Class M-2 Principal Distribution
Amount, the Class M-3 Principal Distribution Amount and the Class
M-4
Principal Distribution Amount; and
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the
excess (if any) of (A) the sum of (1) the Class Principal Balance
of the
Class B-1 Certificates immediately prior to that Distribution Date
and (2)
the aggregate Class Principal Balance of the Class A and Class M
Certificates (after taking into account the payment of the Class
A
Principal Distribution Amount, Class M-1 Principal Distribution Amount,
Class M-2 Principal Distribution Amount, Class M-3 Principal Distribution
Amount and Class M-4 Principal Distribution Amount for such Distribution
Date) over (B) the lesser of (i) the aggregate Stated Principal Balance
of
the Mortgage Loans as of the last day of the related Due Period multiplied
by 75.70% and (ii) the amount, if any, by which (x) the aggregate
Stated
Principal Balance of the Mortgage Loans as of the last day of the
related
Due Period exceeds (y) the Overcollateralization Floor
Amount.
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Class
B-2 Principal Distribution Amount:
With
respect to the Class B-2 Certificates and any Distribution Date (i) prior to
the
Stepdown Date or on or after the Stepdown Date if a Trigger Event is in effect
for that Distribution Date, the Principal Distribution Amount for that
Distribution Date remaining after distribution of the Class A Principal
Distribution Amount, the Class M-1 Principal Distribution Amount, the Class
M-2
Principal Distribution Amount, the Class M-3 Principal Distribution Amount,
the
Class M-4 Principal Distribution Amount and the Class B-1 Principal Distribution
Amount or (ii) on or after the Stepdown Date if a Trigger Event is not in effect
for that Distribution Date, the lesser of:
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the
Principal Distribution Amount for that Distribution Date remaining
after
distribution of the Class A Principal Distribution Amount, the Class
M-1
Principal Distribution Amount, the Class M-2 Principal Distribution
Amount, the Class M-3 Principal Distribution Amount, the Class M-4
Principal Distribution Amount and the Class B-1 Principal Distribution
Amount; and
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the
excess (if any) of (A) the sum of (1) the Class Principal Balance
of the
Class B-2 Certificates immediately prior to that Distribution Date
and (2)
the aggregate Class Principal Balance of the Class A, Class M and
Class
B-1 Certificates (after taking into account the payment of the Class
A
Principal Distribution Amount, Class M-1 Principal Distribution Amount,
Class M-2 Principal Distribution Amount, Class M-3 Principal Distribution
Amount, the Class M-4 Principal Distribution Amount and Class B-1
Principal Distribution Amount for such Distribution Date) over (B)
the
lesser of (i) the aggregate Stated Principal Balance of the Mortgage
Loans
as of the last day of the related Due Period multiplied by 78.90%
and (ii)
the amount, if any, by which (x) the aggregate Stated Principal Balance
of
the Mortgage Loans as of the last day of the related Due Period exceeds
(y) the Overcollateralization Floor
Amount.
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Class
B-3 Principal Distribution Amount:
With
respect to the Class B-3 Certificates and any Distribution Date (i) prior to
the
Stepdown Date or on or after the Stepdown Date if a Trigger Event is in effect
for that Distribution Date, the Principal Distribution Amount for that
Distribution Date remaining after distribution of the Class A Principal
Distribution Amount, the Class M-1 Principal Distribution Amount, the Class
M-2
Principal Distribution Amount, the Class M-3 Principal Distribution Amount,
the
Class M-4 Principal Distribution Amount, the Class B-1 Principal Distribution
Amount and the Class B-2 Principal Distribution Amount or (ii) on or after
the
Stepdown Date if a Trigger Event is not in effect for that Distribution Date,
the lesser of:
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the
Principal Distribution Amount for that Distribution Date remaining
after
distribution of the Class A Principal Distribution Amount, the Class
M-1
Principal Distribution Amount, the Class M-2 Principal Distribution
Amount, the Class M-3 Principal Distribution Amount, the Class M-4
Principal Distribution Amount, the Class B-1 Principal Distribution
Amount
and the Class B-2 Principal Distribution Amount; and
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the
excess (if any) of (A) the sum of (1) the Class Principal Balance
of the
Class B-3 Certificates immediately prior to that Distribution Date
and (2)
the aggregate Class Principal Balance of the Class A, Class M, Class
B-1
and Class B-2 Certificates (after taking into account the payment
of the
Class A Principal Distribution Amount, Class M-1 Principal Distribution
Amount, Class M-2 Principal Distribution Amount, Class M-3 Principal
Distribution Amount, Class M-4 Principal Distribution Amount, Class
B-1
Principal Distribution Amount and Class B-2 Principal Distribution
Amount
for such Distribution Date) over (B) the lesser of (i) the aggregate
Stated Principal Balance of the Mortgage Loans as of the last day
of the
related Due Period multiplied by 81.50% and (ii) the amount, if any,
by
which (x) the aggregate Stated Principal Balance of the Mortgage
Loans as
of the last day of the related Due Period exceeds (y) the
Overcollateralization Floor Amount.
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Class
B-4 Principal Distribution Amount:
With
respect to the Class B-4 Certificates and any Distribution Date (i) prior to
the
Stepdown Date or on or after the Stepdown Date if a Trigger Event is in effect
for that Distribution Date, the Principal Distribution Amount for that
Distribution Date remaining after distribution of the Class A Principal
Distribution Amount, the Class M-1 Principal Distribution Amount, the Class
M-2
Principal Distribution Amount, the Class M-3 Principal Distribution Amount,
the
Class M-4 Principal Distribution Amount, the Class B-1 Principal Distribution
Amount, the Class B-2 Principal Distribution Amount and the Class B-3 Principal
Distribution Amount or (ii) on or after the Stepdown Date if a Trigger Event
is
not in effect for that Distribution Date, the lesser of:
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the
Principal Distribution Amount for that Distribution Date remaining
after
distribution of the Class A Principal Distribution Amount, the Class
M-1
Principal Distribution Amount, the Class M-2 Principal Distribution
Amount, the Class M-3 Principal Distribution Amount, the Class M-4
Principal Distribution Amount, the Class B-1 Principal Distribution
Amount, the Class B-2 Principal Distribution Amount and the Class
B-3
Principal Distribution Amount; and
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the
excess (if any) of (A) the sum of (1) the Class Principal Balance
of the
Class B-4 Certificates immediately prior to that Distribution Date
and (2)
the aggregate Class Principal Balance of the Class A, Class M, Class
B-1,
Class B-2 and Class B-3 Certificates (after taking into account the
payment of the Class A Principal Distribution Amount, Class M-1 Principal
Distribution Amount, Class M-2 Principal Distribution Amount, Class
M-3
Principal Distribution Amount, Class M-4 Principal Distribution Amount,
Class B-1 Principal Distribution Amount, Class B-2 Principal Distribution
Amount and Class B-3 Principal Distribution Amount for such Distribution
Date) over (B) the lesser of (i) the aggregate Stated Principal Balance
of
the Mortgage Loans as of the last day of the related Due Period multiplied
by 84.70% and (ii) the amount, if any, by which (x) the aggregate
Stated
Principal Balance of the Mortgage Loans as of the last day of the
related
Due Period exceeds (y) the Overcollateralization Floor
Amount.
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Class
B-5 Principal Distribution Amount:
With
respect to the Class B-5 Certificates and any Distribution Date (i) prior to
the
Stepdown Date or on or after the Stepdown Date if a Trigger Event is in effect
for that Distribution Date, the Principal Distribution Amount for that
Distribution Date remaining after distribution of the Class A Principal
Distribution Amount, the Class M-1 Principal Distribution Amount, the Class
M-2
Principal Distribution Amount, the Class M-3 Principal Distribution Amount,
the
Class M-4 Principal Distribution Amount, the Class B-1 Principal Distribution
Amount, the Class B-2 Principal Distribution Amount, the Class B-3 Principal
Distribution Amount and the Class B-4 Principal Distribution Amount or (ii)
on
or after the Stepdown Date if a Trigger Event is not in effect for that
Distribution Date, the lesser of:
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the
Principal Distribution Amount for that Distribution Date remaining
after
distribution of the Class A Principal Distribution Amount, Class
M-1
Principal Distribution Amount, Class M-2 Principal Distribution Amount,
Class M-3 Principal Distribution Amount, Class M-4 Principal Distribution
Amount, Class B-1 Principal Distribution Amount, Class B-2 Principal
Distribution Amount, Class B-3 Principal Distribution Amount and
Class B-4
Principal Distribution Amount; and
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the
excess (if any) of (A) the sum of (1) the Class Principal Balance
of the
Class B-5 Certificates immediately prior to that Distribution Date
and (2)
the aggregate Class Principal Balance of the Class A, Class M, Class
B-1,
Class B-2, Class B-3 and Class B-4 Certificates (after taking into
account
the payment of the Class A Principal Distribution Amount, Class M-1
Principal Distribution Amount, Class M-2 Principal Distribution Amount,
Class M-3 Principal Distribution Amount, Class M-4 Principal Distribution
Amount, Class B-1 Principal Distribution Amount, Class B-2 Principal
Distribution Amount, Class B-3 Principal Distribution Amount and
Class B-4
Principal Distribution Amount for such Distribution Date) over (B)
the
lesser of (i) the aggregate Stated Principal Balance of the Mortgage
Loans
as of the last day of the related Due Period multiplied by 87.20%
and (ii)
the amount, if any, by which (x) the aggregate Stated Principal Balance
of
the Mortgage Loans as of the last day of the related Due Period exceeds
(y) the Overcollateralization Floor
Amount.
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Class
M Certificates:
The
Class M-1, Class M-2, Class M-3 and Class M-4 Certificates.
Class
M-1 Principal Distribution Amount:
With
respect to the Class M-1 Certificates and any Distribution Date (i) prior to
the
Stepdown Date or on or after the Stepdown Date if a Trigger Event is in effect
for that Distribution Date, the Principal Distribution Amount for that
Distribution Date remaining after distribution of the Class A Principal
Distribution Amount or (ii) on or after the Stepdown Date if a Trigger Event
is
not in effect for that Distribution Date, the lesser of:
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the
Principal Distribution Amount for that Distribution Date remaining
after
distribution of the Class A Principal Distribution Amount;
and
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the
excess (if any) of (A) the sum of (1) the Class Principal Balance
of the
Class M-1 Certificates immediately prior to that Distribution Date
and (2)
the Class Principal Balance of the Class A-1 Certificates (after
taking
into account the payment of the Class A Principal Distribution Amount
for
such Distribution Date) over (B) the lesser of (i) the aggregate
Stated
Principal Balance of the Mortgage Loans as of the last day of the
related
Due Period multiplied by 52.60% and (ii) the amount, if any, by which
(x)
the aggregate Stated Principal Balance of the Mortgage Loans as of
the
last day of the related Due Period exceeds (y) the Overcollateralization
Floor Amount.
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Class
M-2 Principal Distribution Amount:
With
respect to the Class M-2 Certificates and any Distribution Date (i) prior to
the
Stepdown Date or on or after the Stepdown Date if a Trigger Event is in effect
for that Distribution Date, the Principal Distribution Amount for that
Distribution Date remaining after distribution of the Class A Principal
Distribution Amount and the Class M-1 Principal Distribution Amount or (ii)
on
or after the Stepdown Date if a Trigger Event is not in effect for that
Distribution Date, the lesser of:
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the
Principal Distribution Amount for that Distribution Date remaining
after
distribution of the Class A Principal Distribution Amount and the
Class
M-1 Principal Distribution Amount;
and
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the
excess (if any) of (A) the sum of (1) the Class Principal Balance
of the
Class M-2 Certificates immediately prior to that Distribution Date
and (2)
the aggregate Class Principal Balance of the Class A-1 and Class
M-1
Certificates (after taking into account the payment of the Class
A
Principal Distribution Amount and the Class M-1 Principal Distribution
Amount for such Distribution Date) over (B) the lesser of (i) the
aggregate Stated Principal Balance of the Mortgage Loans as of the
last
day of the related Due Period multiplied by 56.50% and (ii) the amount,
if
any, by which (x) the aggregate Stated Principal Balance of the Mortgage
Loans as of the last day of the related Due Period exceeds (y) the
Overcollateralization Floor Amount.
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Class
M-3 Principal Distribution Amount:
With
respect to the Class M-3 Certificates and any Distribution Date (i) prior to
the
Stepdown Date or on or after the Stepdown Date if a Trigger Event is in effect
for that Distribution Date, the Principal Distribution Amount for that
Distribution Date remaining after distribution of the Class A Principal
Distribution Amount, the Class M-1 Principal Distribution Amount and the Class
M-2 Principal Distribution Amount or (ii) on or after the Stepdown Date if
a
Trigger Event is not in effect for that Distribution Date, the lesser
of:
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the
Principal Distribution Amount for that Distribution Date remaining
after
distribution of the Class A Principal Distribution Amount, the Class
M-1
Principal Distribution Amount and the Class M-2 Principal Distribution
Amount; and
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the
excess (if any) of (A) the sum of (1) the Class Principal Balance
of the
Class M-3 Certificates immediately prior to that Distribution Date
and (2)
the aggregate Class Principal Balance of the Class A-1, Class M-1
and
Class M-2 Certificates (after taking into account the payment of
the Class
A Principal Distribution Amount, the Class M-1 Principal Distribution
Amount and Class M-2 Principal Distribution Amount for such Distribution
Date) over (B) the lesser of (i) the aggregate Stated Principal Balance
of
the Mortgage Loans as of the last day of the related Due Period multiplied
by 67.50% and (ii) the amount, if any, by which (x) the aggregate
Stated
Principal Balance of the Mortgage Loans as of the last day of the
related
Due Period exceeds (y) the Overcollateralization Floor
Amount.
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Class
M-4 Principal Distribution Amount:
With
respect to the Class M-4 Certificates and any Distribution Date (i) prior to
the
Stepdown Date or on or after the Stepdown Date if a Trigger Event is in effect
for that Distribution Date, the Principal Distribution Amount for that
Distribution Date remaining after distribution of the Class A Principal
Distribution Amount, the Class M-1 Principal Distribution Amount, the Class
M-2
Principal Distribution Amount and the Class M-3 Principal Distribution Amount
or
(ii) on or after the Stepdown Date if a Trigger Event is not in effect for
that
Distribution Date, the lesser of:
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the
Principal Distribution Amount for that Distribution Date remaining
after
distribution of the Class A Principal Distribution Amount, the Class
M-1
Principal Distribution Amount, the Class M-2 Principal Distribution
Amount
and the Class M-3 Principal Distribution Amount; and
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the
excess (if any) of (A) the sum of (1) the Class Principal Balance
of the
Class M-3 Certificates immediately prior to that Distribution Date
and (2)
the aggregate Class Principal Balance of the Class A-1, Class M-1,
Class
M-2 and Class M-3 Certificates (after taking into account the payment
of
the Class A Principal Distribution Amount, the Class M-1 Principal
Distribution Amount, Class M-2 Principal Distribution Amount and
Class M-3
Principal Distribution Amount for such Distribution Date) over (B)
the
lesser of (i) the aggregate Stated Principal Balance of the Mortgage
Loans
as of the last day of the related Due Period multiplied by 70.90%
and (ii)
the amount, if any, by which (x) the aggregate Stated Principal Balance
of
the Mortgage Loans as of the last day of the related Due Period exceeds
(y) the Overcollateralization Floor
Amount.
|
Class
OC Certificates:
As
specified in the Preliminary Statement.
Class
OC Distributable Amount:
With
respect to any Distribution Date and the Class OC Certificates, the excess,
if
any, of (x) the sum of (i) the amount of interest accrued during the related
Accrual Period at the related Pass-Through Rate on the Class Principal Balance
for such Distribution Date and (ii) the Overcollateralization Release Amount,
if
any, for such Distribution Date, over (y) the Overcollateralization Increase
Amount, if any, for such Distribution Date.
Class
P Distribution Amount:
For
each Distribution Date, an amount equal to the total of all Prepayment Penalties
received by the Trustee from the Servicer on the Mortgage Loans in the prior
Due
Period.
12
Class
Principal Balance:
With
respect to any Class of Certificates other than the Class OC 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 OC
Certificates and any Distribution Date, the Overcollateralized Amount as of
that
Distribution Date.
Clearing
Agency:
An
organization registered as a “clearing agency” pursuant to Section 17A of
the Exchange Act. As of the Closing Date, the Clearing Agency shall be The
Depository Trust Company.
Clearing
Agency Participant:
A
broker, dealer, bank, other financial institution or other Person for whom
from
time to time a Clearing Agency effects book-entry transfers and pledges of
securities deposited with the Clearing Agency.
Closing
Date:
October
31, 2006.
CLTV:
As of
any date and as to any Second Lien Loan, the ratio, expressed as a percentage,
of the (a) sum of (i) the outstanding principal balance of such Second Lien
Loan
and (ii) the outstanding principal balance as of such date of any mortgage
loan
or mortgage loans that are senior or equal in priority to such Second Lien
Loan
and which are secured by the same Mortgaged Property to (b) the appraised value
of the Mortgaged Property.
Code:
The
Internal Revenue Code of 1986, as amended, and as it may be further amended
from
time to time, any successor statutes thereto, and applicable U.S. Department
of
Treasury regulations issued pursuant thereto in temporary or final
form.
Compensating
Interest Payment:
As to
any Distribution Date, an amount equal to the aggregate amount of any Prepayment
Interest Shortfalls required to be paid by the Servicer with respect to such
Distribution Date pursuant to the Servicing Agreement.
Consent:
A
document executed by the Cooperative Corporation (i) consenting to the sale
of
the Cooperative Unit to the Mortgagor and (ii) certifying that all maintenance
charges relating to the Cooperative Unit have been paid.
Cooperative
Corporation:
The
entity that holds title (fee or an acceptable leasehold estate) to the real
property and improvements constituting the Cooperative Property and which
governs the Cooperative Property, which Cooperative Corporation must qualify
as
a Cooperative Housing Corporation under Section 216 of the
Code.
Cooperative
Loan:
A
Mortgage Loan secured by Cooperative Shares and a Proprietary Lease, if
any.
Cooperative
Property:
The
real property and improvements owned by the Cooperative Corporation, that
includes the allocation of individual dwelling units to the holders of the
shares of the Cooperative Corporation.
Cooperative
Shares:
Shares
issued by a Cooperative Corporation.
13
Cooperative
Unit:
With
respect to any Cooperative Loan, a specific unit in a Cooperative Property.
Corporate
Trust Office:
With
respect to the Trustee, LaSalle Bank National Association, 000 Xxxxx XxXxxxx
Xxxxxx, Xxxxx 0000, Xxxxxxx, Xxxxxxxx 00000 Attention: Global Securities and
Trust Services/Xxxxxx Xxxxxxx Mortgage Loan Trust 2006-14SL, or such other
address as the Trustee may designate from time to time by notice to the
Certificateholders, the Depositor or the principal corporate trust office of
any
successor Trustee.
Custodial
Account:
Each
custodial account (other than an Escrow Account) established and maintained
by
the Servicer pursuant to a Servicing Agreement.
Custodial
Agreement:
The
Custodial Agreements listed on Exhibit F, as each such agreement may be amended
or supplemented from time to time as permitted hereunder and
thereunder.
Custodian:
A
Person who is at anytime appointed by the Trustee, the Seller or the Depositor
as a custodian of the Mortgage Documents and the Trustee Mortgage Files. The
initial Custodian under this Agreement is LaSalle. “Custodian” shall refer to
each Custodian or all Custodians, as the context requires.
Cut-off
Date:
October
1, 2006.
Cut-off
Date Pool Principal Balance:
$353,987,032.37.
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.
Decision
One:
Decision One Mortgage Company, LLC.
Decision
One Mortgage Loan:
Each
Mortgage Loan originated by Decision One and listed on the Mortgage Loan
Schedule.
Decision
One Purchase Agreement:
The
Fourth Amended and Restated Mortgage Loan Purchase and Warranties Agreement
dated as of May 1, 2006, listed in Exhibit E hereto and each between the Seller
and Decision One.
Debt
Service Reduction:
With
respect to any Mortgage Loan, a reduction by a court of competent jurisdiction
in a proceeding under the 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.
Defective
Mortgage Loan:
The
meaning specified in Section 2.05(b).
Deficient
Valuation:
With
respect to any Mortgage Loan, a valuation of the related Mortgaged Property
by a
court of competent jurisdiction in an amount less than the then outstanding
indebtedness under the Mortgage Loan, or any reduction in the amount of
principal to be paid in connection with any Scheduled Payment that results
in a
permanent forgiveness of principal, which valuation or reduction results from
an
order of such court which is final and non-appealable in a proceeding under
the
Bankruptcy Code.
14
Definitive
Certificate:
A
Certificate of any Class issued in definitive, fully registered, certificated
form. As of the Closing Date the Classes of Certificates being issued as
“Definitive Certificates” are set forth in the Preliminary
Statement.
Delay
Certificates:
As
specified in the Preliminary Statement.
Deleted
Mortgage Loan:
A
Mortgage Loan that is repurchased, or replaced or to be replaced with a
Replacement Mortgage Loan.
Delinquent:
For
reporting purposes, a Mortgage Loan is “delinquent” when any payment
contractually due thereon has not been made by the close of business on the
Due
Date therefor. Such Mortgage Loan is “30 days Delinquent” if such payment has
not been received by the close of business on the corresponding day of the
month
immediately succeeding the month in which such payment was first due, or, if
there is no such corresponding day (e.g., as when a 30-day month follows a
31-day month in which a payment was due on the 31st day of such month), then
on
the last day of such immediately succeeding month. Similarly for “60 days
Delinquent” and the second immediately succeeding month and “90 days Delinquent”
and the third immediately succeeding month.
Depositor:
Xxxxxx
Xxxxxxx Capital I Inc., a Delaware corporation having its principal place of
business in New York, or its successors in interest.
Determination
Date:
With
respect to the Servicer, the “Determination Date” set forth in the Servicing
Agreement.
Disqualified
Organization:
A
“disqualified organization” as defined in Section 860E(e)(5) of the
Code.
Distribution
Account:
The
separate Eligible Account created and maintained by the Trustee pursuant to
Section 4.01. Funds in the Distribution Account (exclusive of any earnings
on investments made with funds deposited 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:
With
respect to the Servicer, not later than 1:00 p.m., New York time, on the 18th
day of each calendar month after the initial issuance of the Certificates or,
if
such 18th day is not a Business Day, the immediately following Business Day,
commencing in November 2006.
Distribution
Date:
The
25th day of each month or, if such 25th day is not a Business Day, the next
succeeding Business Day, commencing in November 2006.
Due
Date:
With
respect to any Mortgage Loan, the date on which a Scheduled Payment is due
under
the related Mortgage Note as indicated in the related Servicing
Agreement.
15
Due
Period:
As to
any Distribution Date, the period beginning on the second day of the month
preceding the month of such Distribution Date, and ending on the first day of
the month of such Distribution Date.
Eligible
Account:
Any of
(i) an account or accounts maintained with a federal or state chartered
depository institution or trust company the short-term unsecured debt
obligations of which (or, in the case of a depository institution or trust
company that is the principal subsidiary of a holding company, the debt
obligations of such holding company) have the highest short-term ratings of
each
Rating Agency at the time any amounts are held on deposit therein, or
(ii) an account or accounts in a depository institution or trust company in
which such accounts are insured by the FDIC or the SAIF (to the limits
established by the FDIC or the SAIF) and the uninsured deposits in which
accounts are otherwise secured such that, as evidenced by an Opinion of Counsel
delivered to the Trustee and to each Rating Agency, the Certificateholders
have
a claim with respect to the funds in such account or a perfected first priority
security interest against any collateral (which shall be limited to Permitted
Investments) securing such funds that is superior to claims of any other
depositors or creditors of the depository institution or trust company in which
such account is maintained, or (iii) a trust account or accounts maintained
with the trust department of a federal or state chartered depository institution
or trust company, acting in its fiduciary capacity or (iv) any other
account acceptable to each Rating Agency, as evidenced by a signed writing
delivered by each Rating Agency. Eligible Accounts may bear interest, and may
include, if otherwise qualified under this definition, accounts maintained
with
the Trustee or the Paying Agent.
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 an Underwriter’s Exemption.
ERISA-Restricted
Certificate:
As
specified in the Preliminary Statement.
Escrow
Account:
With
respect to each Mortgage Loan, as defined in Article I of the Servicing
Agreement.
Estoppel
Letter:
A
document executed by the Cooperative Corporation certifying, with respect to
a
Cooperative Unit, (i) the appurtenant Proprietary Lease will be in full force
and effect as of the date of issuance thereof, (ii) the related stock
certificate was registered in the Mortgagor’s name and the Cooperative
Corporation has not been notified of any lien upon, pledge of, levy of execution
on or disposition of such stock certificate, and (iii) the Mortgagor is not
in
default under the appurtenant Proprietary Lease and all charges due the
Cooperative Corporation have been paid.
Exchange
Act:
The
Securities Exchange Act of 1934, as amended.
Extra
Principal Distribution Amount:
For any
Distribution Date, the lesser of (i) the Net Monthly Excess Cashflow for such
Distribution Date and (ii) the Overcollateralization Increase
Amount.
16
Xxxxxx
Xxx:
The
entity formerly known as the Federal National Mortgage Association, a federally
chartered and privately owned corporation organized and existing under the
Federal National Mortgage Association Charter Act, or any successor
thereto.
FDIC:
The
Federal Deposit Insurance Corporation or any successor thereto.
FHLMC:
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.
Global
Securities:
The
global certificates representing the Book-Entry Certificates.
GMAC:
GMAC
Mortgage Corporation.
Holder:
The
registered owner of any Certificate as recorded on the books of the Certificate
Registrar except that, solely for the purposes of taking any action or giving
any consent pursuant to this Agreement, any Certificate registered in the name
of the Depositor, the Trustee and the Servicer, or any Affiliate thereof shall
be deemed not to be outstanding in determining whether the requisite percentage
necessary to effect any such consent has been obtained, except that, in
determining whether the Trustee shall be protected in relying upon any such
consent, only Certificates that a Responsible Officer of the Trustee knows
to be
so owned shall be disregarded. The Trustee may request and conclusively rely
on
certifications by the Depositor or the Servicer in determining whether any
Certificates are registered to an Affiliate of the Depositor or the
Servicer.
Independent:
When
used with respect to any Accountants, a Person who is “independent” within the
meaning of Rule 2-01(b) of the Securities and Exchange Commission’s
Regulation S-X. 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 financial interest
in such other Person or any Affiliate of such other Person, and (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.
Initial
Optional Purchase Date:
The
first Distribution Date following the date on which the aggregate Stated
Principal Balance of the Mortgage Loans is equal to or less than 10% of the
aggregate Stated Principal Balance thereof as of the Cut-off Date.
Insurance
Policy:
With
respect to any Mortgage Loan, any insurance policy, including all names and
endorsements thereto in effect, including any replacement policy or policies
for
any Insurance Policies.
Insurance
Proceeds:
Proceeds paid by any Insurance Policy (excluding proceeds required to be applied
to the restoration and repair of the related Mortgaged Property or released
to
the Mortgagor), in each case other than any amount included in such Insurance
Proceeds in respect of Insured Expenses.
17
Insured
Expenses:
Expenses covered by an Insurance Policy or any other insurance policy with
respect to the Mortgage Loans.
Interest
Accrual Period:
With
respect to each Class of Delay Certificates, its corresponding Subsidiary REMIC
Regular Interest and any Distribution Date, the calendar month prior to the
month of such Distribution Date. With respect to any Class of Non-Delay
Certificates, its corresponding Subsidiary REMIC Regular Interest and any
Distribution Date, the one month period commencing on and including the
Distribution Date in the month immediately preceding the month in which such
Distribution Date occurs (or in the case of the Distribution Date in November
2006, commencing on and including the Closing Date) and ending on the day
immediately preceding such Distribution Date. Interest shall be calculated
on
each Class of Non-Delay Certificates based on the actual number of days elapsed
in each Interest Accrual Period and a 360-day year. Interest shall be calculated
on each Class of Delay Certificates based upon a 360-day year consisting of
twelve 30-day months, and each Interest Accrual Period shall be deemed to have
30 days.
Interest
Carry Forward Amount:
With
respect to any of the Class A-1, Class M-1, Class M-2, Class M-3, Class M-4,
Class B-1, Class B-2, Class B-3, Class B-4 and Class B-5 Certificates and any
Distribution Date, the amount, if any, by which the Interest Distribution Amount
for such Class of Certificates for the immediately preceding Distribution Date
exceeds the actual amount distributed on such Class in respect of interest
on
the immediately preceding Distribution Date, together with any Interest Carry
Forward Amount with respect to such Class remaining unpaid from the previous
Distribution Date, plus interest accrued thereon at the related Pass-Through
Rate for the most recently ended Interest Accrual Period.
Interest
Determination Date:
With
respect to any Interest Accrual Period for any Class of LIBOR Certificates,
the
second LIBOR Business Day prior to the first day of such Interest Accrual
Period.
Interest
Distribution Amount:
With
respect to the Senior Certificates, the Class A Interest Distribution Amount.
With respect to the Subordinated Certificates, the Subordinated Interest
Distribution Amount.
Interest
Remittance Amount:
For any
Distribution Date, that portion of the Available Distribution Amount for such
Distribution Date that represents interest received or advanced on the Mortgage
Loans.
LaSalle:
LaSalle
Bank National Association.
Latest
Possible Maturity Date:
The
Distribution Date in October 2041.
LIBOR:
The
London interbank offered rate for one-month United States dollar deposits
calculated in the manner described in Section 5.05.
LIBOR
Business Day:
Any day
on which banks in London, England and The City of New York are open and
conducting transactions in foreign currency and exchange.
LIBOR
Certificates:
As
specified in the Preliminary Statement.
18
Liquidated
Mortgage Loan:
With
respect to any Distribution Date, a Charged-Off Mortgage Loan, or 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 Trustee (in accordance with the Servicing
Agreement) 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:
Amounts, including Insurance Proceeds, received in connection with the partial
or complete liquidation of defaulted Mortgage Loans, whether through trustee’s
sale, foreclosure sale or otherwise or amounts received in connection with
any
condemnation or partial release of a Mortgaged Property and any other proceeds
received in connection with an REO Property.
Loan-To-Value
Ratio:
With
respect to any Mortgage Loan and as to any date of determination, the fraction
(expressed as a percentage) the numerator of which is the principal balance
of
the related Mortgage Loan at such date of determination and the denominator
of
which is the Appraised Value of the related Mortgaged Property.
Master
REMIC:
As
described in the Preliminary Statement.
Memorandum:
The
private placement memorandum to be dated as of October 24, 2006, relating to
the
Private Certificates.
MERS:
Mortgage Electronic Registration Systems, Inc., a corporation organized and
existing under the laws of the State of Delaware, or any successor to Mortgage
Electronic Registration Systems, Inc.
MERS
Mortgage Loan:
Any
Mortgage Loan registered with MERS on the MERS® System.
MERS®
System:
The
system of recording transfers of mortgages electronically maintained by
MERS.
MIN:
The
mortgage identification number for any MERS Mortgage Loan.
Minimum
Auction Price:
With
respect to any Distribution Date on which an auction is being held, the sum
of
(a) 100% of the current aggregate Stated Principal Balance of the Mortgage
Loans, plus accrued interest thereon, (b) the fair market value of any related
REO Property in the Trust Fund, as determined by an appraiser selected by the
Auction Administrator (in consultation with the Servicer) with the consent
of
the Depositor, and all other property in the Trust Fund being purchased
(reduced, in the case of REO Property, by (1) reasonably anticipated disposition
costs and (2) any amount by which the fair market value as so reduced exceeds
the outstanding Stated Principal Balance of the related Mortgage Loan plus
accrued interest thereon at the applicable Mortgage Rate), (c) any xxxxxxxxxxxx
X&X Advances and Servicer Advances related to the Mortgage Loans, (d)
any
amounts owed to the Trustee and the Custodians and not previously reimbursed
and
(e)
any expenses incurred by the Auction Administrator relating to the auction
process.
19
MOM
Loan:
Any
Mortgage Loan as to which MERS is acting as mortgagee, solely as nominee for
the
originator of such Mortgage Loan and its successors and assigns.
Moody’s:
Xxxxx’x
Investors Service, Inc., or any successor thereto. For purposes of Section
10.07
the address for notices to Moody’s shall be Xxxxx’x Investors Service, Inc., 00
Xxxxxx Xxxxxx, Xxx Xxxx, Xxx Xxxx 00000, Attention: Residential Pass-Through
Monitoring, or such other address as Moody’s may hereafter furnish to the
Depositor or the Trustee.
Mortgage:
A
mortgage, deed of trust or other instrument encumbering a fee simple interest
in
real property securing a Mortgage Note, together with improvements
thereto.
Mortgage
Documents:
With
respect to each Mortgage Loan, the mortgage documents required to be delivered
to the Custodian pursuant to the applicable Custodial Agreement.
Mortgage
Loan:
A
Mortgage and the related notes or other evidences of indebtedness secured by
each such Mortgage conveyed, transferred, sold, assigned to or deposited with
the Trustee pursuant to Section 2.01 (including any REO Property),
including without limitation, each Mortgage Loan listed on the Mortgage Loan
Schedule, as amended from time to time. Any Released Mortgage Loan shall not
be
considered a Mortgage Loan subject to this Agreement.
Mortgage
Loan Auction Price:
As
defined in Section 7.01(b).
Mortgage
Loan Schedule:
The
schedule of Mortgage Loans setting forth the following information with respect
to each Mortgage Loan as of the close of business on the Cut-off Date: (1)
the
applicable Originator’s Mortgage Loan identifying number; (2) the Mortgagor’s
name; (3) the street address of the Mortgaged Property including the city,
state
and zip code; (4) a code indicating whether the Mortgagor is self-employed;
(5)
a code indicating whether the Mortgaged Property is owner-occupied; (6) the
number and type of residential units constituting the Mortgaged Property; (7)
the original months to maturity or the remaining months to maturity from the
Cut-off Date, in any case based on the original amortization schedule and,
if
different, the maturity expressed in the same manner but based on the actual
amortization schedule; (8) with respect to each Second Lien Loan, the CLTV
at
origination; (9) the Mortgage Interest Rate as of the related Cut-off Date;
(10)
the day of the month on which the Monthly Payment is due on the Mortgage Loan
and, if such date is not consistent with the Due Date currently in effect,
such
Due Date; (11) the stated maturity date; (12) the first payment date; (13)
the
amount of the Monthly Payment as of the Cut-off Date; (14) the last payment
date
on which a payment was actually applied to the outstanding principal balance;
(15) the original principal amount of the Mortgage Loan; (16) the principal
balance of the Mortgage Loan as of the close of business on the Cut-off Date,
after deduction of payments of principal due and collected on or before the
Cut-off Date; (17) delinquency status as of the Cut-off Date; (18) the type
of
Mortgage Loan (i.e., fixed or adjustable rate Mortgage Loan, first or Second
Lien Loan); (19) a code indicating the purpose of the loan (i.e., purchase,
rate
and term refinance, equity take-out refinance); (20) a code indicating the
documentation style (i.e., full, alternative or reduced); (21) asset
verification (Y/N); (22) the loan credit classification (as described in the
Underwriting Guidelines); (23) whether such Mortgage Loan provides for a
Prepayment Penalty and, if applicable, the Prepayment Penalty Period; (24)
the
Mortgage Interest Rate as of origination; (25) the credit risk score (FICO
score); (26) the date of origination; (27) a code indicating whether the
Mortgage Loan is categorized as a Home Loan pursuant to Appendix E of Standard
& Poor’s LEVELS® Glossary, as in effect from time to time; (28) the
applicable Custodian; (29) the Due Date for the first Monthly Payment; (30)
the
original Monthly Payment due; (31) a code indicating the Primary Insurance
Policy provider and percentage of coverage, if applicable; (32) Appraised Value;
(33) appraisal type; (34) automated valuation model (AVM); (35) appraisal date;
(36) with respect the related Mortgagor, the debt-to-income ratio and any other
information reasonably requested by the Trustee; and (37) the MERS
Identification Number, if any. With respect to the Mortgage Loans in the
aggregate, the Mortgage Loan Schedule shall set forth the following information,
as of the related Cut-off Date: (1) the number of Mortgage Loans; (2) the
current aggregate outstanding principal balance of the Mortgage Loans; (3)
the
weighted average Mortgage Interest Rate of the Mortgage Loans and (4) the
weighted average maturity of the Mortgage Loans.
20
Mortgage
Note:
The
original executed note or other evidence of the indebtedness of a Mortgagor
secured by a Mortgage under a Mortgage Loan.
Mortgage
Rate:
As to
any Mortgage Loan, the annual rate of interest borne by the related Mortgage
Notes.
Mortgaged
Property:
The
underlying property, which, with respect to a Cooperative Loan, is the related
Cooperative Shares and Proprietary Lease.
Mortgagor:
The
obligor on a Mortgage Note.
Net
Liquidation Proceeds:
With
respect to any Liquidated Mortgage Loan or any other disposition of related
Mortgaged Property, the related Liquidation Proceeds net of Servicer Advances,
P&I Advances, Servicing Fees and any other accrued and unpaid servicing fees
received and retained in connection with the liquidation of such Mortgage Loan
or Mortgaged Property.
Net
Monthly Excess Cashflow:
For any
Distribution Date, the excess, if any, of (x) the Available Distribution Amount
for the Distribution Date over (y) the sum for the Distribution Date of the
aggregate of the Interest Distribution Amounts payable to the holders of the
Certificates and the Principal Distribution Amount.
Net
Mortgage Rate:
With
respect to any Mortgage Loan and any Distribution Date, the related Mortgage
Rate as of the Due Date in the month preceding the month of such Distribution
Date reduced by the Servicing Fee Rate for such Mortgage Loan.
Net
Prepayment Interest Shortfalls:
As to
any Distribution Date, the amount by which the aggregate of Prepayment Interest
Shortfalls exceeds the Compensating Interest Payments for such Distribution
Date.
Net
WAC Cap:
For any
Distribution Date, a per annum rate (adjusted on the basis of a 360-day year
and
the actual number of days in the related Interest Accrual Period) equal to
the
Weighted Average Net Mortgage Rate of the Mortgage Loans as of the first day
of
the month preceding the month in which such Distribution Date occurs, not
including any Mortgage Loan for which a prepayment in full was received after
such first day and distributed on the preceding Distribution Date.
21
Non-Book-Entry
Certificate:
Any
Certificate other than a Book-Entry Certificate.
Non-Delay
Certificates:
As
specified in the Preliminary Statement.
Non-permitted
Foreign Holder:
As
defined in Section 3.03(f).
Non-U.S.
Person:
Any
person other than a “United States person” within the meaning of
Section 7701(a)(30) of the Code.
Nonrecoverable
Advance:
Any
portion of a P&I Advance or Servicer Advance previously made or proposed to
be made by the Servicer (as certified in an Officer’s Certificate of the
Servicer), which in the good faith judgment of such party, shall not be
ultimately recoverable by the Servicer from the related Mortgagor, related
Liquidation Proceeds or otherwise.
Offered
Certificates:
As
specified in the Preliminary Statement.
Offering
Document:
The
Prospectus or the Memorandum, as applicable.
Officer’s
Certificate:
A
certificate signed by two Authorized Officers of the Depositor, and delivered
to
the Trustee.
Officer’s
Certificate of the Servicer:
A
certificate (i) signed by the Chairman of the Board, the Vice Chairman of
the Board, the President, a Managing Director, a Vice President (however
denominated), an Assistant Vice President, the Treasurer, the Secretary, or
one
of the Assistant Treasurers or Assistant Secretaries of the Servicer, or
(ii) if provided for herein, signed by a Servicing Officer, as the case may
be, and delivered to the Trustee.
Opinion
of Counsel:
A
written opinion of counsel, reasonably acceptable in form and substance to
the
Trustee and who may be in-house or outside counsel to the Depositor or the
Trustee but which must be Independent outside counsel with respect to any such
opinion of counsel concerning the transfer of any Residual Certificate or
concerning certain matters with respect to ERISA, or the taxation, or the
federal income tax status, of each REMIC.
Originator:
Any one
of Aames, Aegis or Decision One, as applicable.
Overcollateralization
Floor Amount:
For any
Distribution Date, an amount equal to $1,769,935.
Overcollateralization
Increase Amount:
With
respect to any Distribution Date, the amount, if any, by which the
Overcollateralization Target Amount exceeds the Overcollateralized Amount for
such Distribution Date (calculated for this purpose only after assuming that
100% of the Principal Distribution Amount on such Distribution Date has been
distributed).
22
Overcollateralization
Release Amount:
For any
Distribution Date, the lesser of (1) the Principal Distribution Amount and
(2)
the excess of (a) the Overcollateralized Amount over (b) the
Overcollateralization Target Amount. In addition, in connection with the final
distribution on the Class A-1, Class M-1, Class M-2, Class M-3, Class M-4,
Class
B-1, Class B-2, Class B-3, Class B-4 and Class B-5 Certificates pursuant to
Section 7.02 hereof, the Overcollateralization Release Amount for the related
Distribution Date shall also include the excess, if any of, (a) the purchase
price paid for the Mortgage Loans and any REO Properties pursuant to Section
7.01 hereof, less any costs incurred by the Trust Fund in connection with the
liquidation thereof pursuant to Section 7.02 hereof, over (b) the amount
distributed on the Class A-1, Class M-1, Class M-2, Class M-3, Class M-4, Class
B-1, Class B-2, Class B-3, Class B-4 and Class B-5 Certificates on such
Distribution Date.
Overcollateralization
Target Amount:
With
respect to any Distribution Date (a) prior to the Stepdown Date will equal
the
product of (x) 6.40% and (y) the Cut-off Date Pool Principal Balance, (b) on
or
after the Stepdown Date and on which a Trigger Event is not in effect, shall
equal the greater of (i) product of (x) 12.80% and (y) the aggregate Stated
Principal Balance of the Mortgage Loans as of such Distribution Date and (ii)
the Overcollateralization Floor Amount and (c) on or after the Stepdown Date
and
on which a Trigger Event is in effect, the Overcollateralization Target Amount
for the immediately preceding Distribution Date.
Overcollateralized
Amount:
As of
the Closing Date will be an amount equal to $22,655,168.37. With respect to any
Distribution Date following the Closing Date, the amount by which the aggregate
Stated Principal Balance of the Mortgage Loans as of the last day of the related
Due Period exceeds the aggregate Class Principal Balances of the Class A-1,
Class M-1, Class M-2, Class M-3, Class M-4, Class B-1, Class B-2, Class B-3,
Class B-4 and Class B-5 Certificates after taking into account all payments
of principal on such Distribution Date.
P&I
Advances:
With
respect to a Mortgage Loan, the payments required to be made by the Servicer
with respect to any Distribution Date pursuant to the Servicing Agreement,
the
amount of any such payment being equal to the aggregate of the payments of
principal and interest (net of the applicable Servicing Fee and net of any
net
income in the case of any REO Property) on the Mortgage Loans (other than
Charged-off Loans or Released Mortgage Loans) that were due on the related
Due
Date and not received as of the Business Day immediately preceding the
Distribution Account Deposit Date, less the aggregate amount of any such
delinquent payments that the Servicer has determined would constitute
Nonrecoverable Advances if advanced.
Pass-Through
Margin:
For
each of the Class A-1, Class M-1, Class M-2, Class M-3, Class M-4, Class B-1,
Class B-2 and Class B-3 Certificates and the Interest Accrual Period related
to
each Distribution Date, as follows:
23
|
(1)
|
(2)
|
||
|
Class
A-1
|
0.160%
|
0.320%
|
|
|
Class
M-1
|
0.370%
|
0.555%
|
|
|
Class
M-2
|
0.390%
|
0.585%
|
|
|
Class
M-3
|
0.550%
|
0.825%
|
|
|
Class
M-4
|
0.650%
|
0.975%
|
|
|
Class
B-1
|
1.250%
|
1.875%
|
|
|
Class
B-2
|
1.400%
|
2.100%
|
|
|
Class
B-3
|
2.600%
|
3.900%
|
__________
|
(1)
|
For
the Interest Accrual Period for each Distribution Date occurring
on or
prior to the Initial Optional Purchase
Date.
|
|
(2)
|
For
each Interest Accrual Period following the Initial Optional Purchase
Date.
|
Pass-Through
Rate:
For any
interest bearing Class of Certificates or Component, the per annum rate set
forth or calculated in the manner described in the Preliminary
Statement.
Paying
Agent:
Any
paying agent appointed pursuant to Section 3.08. The initial Paying Agent
shall be the Trustee under this Agreement.
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
initial principal balance of such Certificate by the aggregate of the Class
Principal Balance of all Certificates of the same Class.
Permitted
Investments:
At any
time, any one or more of the following obligations and securities:
(i) obligations
of the United States or any agency thereof, provided that such obligations
are
backed by the full faith and credit of the United States;
(ii) general
obligations of or obligations guaranteed by any state of the United States
or
the District of Columbia receiving the highest long-term debt rating of each
Rating Agency, or such lower rating as shall not result in the downgrading
or
withdrawal of the ratings then assigned to the Certificates by the Rating
Agencies, as evidenced by a signed writing delivered by each Rating
Agency;
(iii) commercial
or finance company paper which is then receiving the highest commercial or
finance company paper rating of each Rating Agency rating such paper, or such
lower rating as shall not result in the downgrading or withdrawal of the ratings
then assigned to the Certificates by the Rating Agencies, as evidenced by a
signed writing delivered by each Rating Agency;
(iv) certificates
of deposit, demand or time deposits, or bankers’ acceptances issued by any
depository institution or trust company incorporated under the laws of the
United States or of any state thereof and subject to supervision and examination
by federal and/or state banking authorities, provided that the commercial paper
and/or long-term unsecured debt obligations of such depository institution
or
trust company (or in the case of the principal depository institution in a
holding company system, the commercial paper or long-term unsecured debt
obligations of such holding company, but only if Xxxxx’x is not the applicable
Rating Agency) are then rated one of the two highest long-term and the highest
short-term ratings of each Rating Agency for such securities, or such lower
ratings as shall not result in the downgrading or withdrawal of the ratings
then
assigned to the Certificates by the Rating Agencies, as evidenced by a signed
writing delivered by each Rating Agency;
24
(v) demand
or
time deposits or certificates of deposit issued by any bank or trust company
or
savings institution to the extent that such deposits are fully insured by the
FDIC;
(vi) guaranteed
reinvestment agreements issued by any bank, insurance company or other
corporation acceptable to the Rating Agencies at the time of the issuance of
such agreements, as evidenced by a signed writing delivered by each Rating
Agency;
(vii) repurchase
obligations with respect to any security described in clauses (i) and (ii)
above, in either case entered into with a depository institution or trust
company (acting as principal) described in clause (iv) above;
(viii) securities
(other than stripped bonds, stripped coupons or instruments sold at a purchase
price in excess of 115% of the face amount thereof) bearing interest or sold
at
a discount issued by any corporation incorporated under the laws of the United
States or any state thereof which, at the time of such investment, have one
of
the two highest ratings of each Rating Agency (except if the Rating Agency
is
Moody’s, such rating shall be the highest commercial paper rating of Moody’s for
any such series), or such lower rating as shall not result in the downgrading
or
withdrawal of the ratings then assigned to the Certificates by the Rating
Agencies, as evidenced by a signed writing delivered by each Rating
Agency;
(ix) interests
in any money market fund which at the date of acquisition of the interests
in
such fund and throughout the time such interests are held in such fund has
the
highest applicable rating by each Rating Agency rating such fund or such lower
rating as shall not result in a change in the rating then assigned to the
Certificates by each Rating Agency, as evidenced by a signed writing delivered
by each Rating Agency, including funds for which the Trustee or any of its
Affiliates is investment manager or adviser;
(x) short-term
investment funds sponsored by any trust company or national banking association
incorporated under the laws of the United States or any state thereof which
on
the date of acquisition has been rated by each applicable Rating Agency in
their
respective highest applicable rating category or such lower rating as shall
not
result in a change in the rating then specified stated maturity and bearing
interest or sold at a discount acceptable to each Rating Agency as shall not
result in the downgrading or withdrawal of the ratings then assigned to the
Certificates by the Rating Agencies, as evidenced by a signed writing delivered
by each Rating Agency; and
25
(xi) such
other investments having a specified stated maturity and bearing interest or
sold at a discount acceptable to the Rating Agencies as shall not result in
the
downgrading or withdrawal of the ratings then assigned to the Certificates
by
the Rating Agencies, as evidenced by a signed writing delivered by each Rating
Agency;
provided,
that no such instrument shall be a Permitted Investment if (i) such
instrument evidences the right to receive interest only payments with respect
to
the obligations underlying such instrument or (ii) such instrument would
require the Depositor to register as an investment company under the Investment
Company Act of 1940, as amended.
Person:
Any
individual, corporation, partnership, joint venture, association, joint-stock
company, limited liability company, trust, unincorporated organization or
government or any agency or political subdivision thereof.
Plan:
Any
employee benefit plan or other plan or arrangement subject to Section 406 of
ERISA or Section 4975 of the Code, including individual retirement accounts
and
annuities, Xxxxxx plans or collective investment funds and such plans, accounts
or arrangements are invested.
Plan
Asset Regulations:
The
Department of Labor regulations set forth in 29 C.F.R. §2510.3-101.
Pool
Assets:
The
Mortgage Loans, any REO Property and any other property remaining in the Trust
Fund.
Prepayment
Interest Excess Amount:
With
respect to any Principal Prepayment in full that is applied to the related
Mortgage Loan from the first day of the month of any Distribution Date through
the fifteenth day of the month of such Distribution Date, all amounts paid
in
respect of interest on such Principal Prepayment in full. A Prepayment Interest
Excess Amount cannot result from a Principal Prepayment in part, but only from
a
Principal Prepayment in full.
Prepayment
Interest Shortfall:
With
respect to each Mortgage Loan, the amount of the shortfall in interest payable
on such Mortgage Loan that occurs as a result of the prepayment by the related
Mortgagor of such Mortgage Loan calculated in accordance with formula set forth
in the Servicing Agreement.
Prepayment
Penalty:
As to a
Mortgage Loan, any premium, penalty or charge payable by a Mortgagor in
connection with certain partial prepayments and all prepayments in full made
within the related Prepayment Penalty Period, the Prepayment Penalties with
respect to each applicable Mortgage Loan so held by the Trust Fund being
identified in the Prepayment Penalty Schedule.
Prepayment
Penalty Period:
As to
any Mortgage Loan, the period of time during which a Prepayment Penalty may
be
imposed.
Prepayment
Penalty Schedule:
As of
any date, the list of Prepayment Penalties included in the Trust Fund on that
date (including the Prepayment Penalty summary attached thereto). The Prepayment
Penalty Schedule shall set forth the following information with respect to
each
Prepayment Penalty:
26
|
·
|
the
Mortgage Loan account number;
|
|
·
|
a
code indicating the type of Prepayment
Penalty;
|
|
·
|
the
state of origination in which the related Mortgage Property is
located;
|
|
·
|
the
first date on which a monthly payment is or was due under the related
Mortgage Note;
|
|
·
|
the
term of the Prepayment Penalty;
|
|
·
|
the
original principal amount of the related Mortgage Loan;
and
|
|
·
|
the
Cut-off Date Principal Balance of the related Mortgage
Loan.
|
The
Prepayment Penalty Schedule shall be amended from time to time by the Seller
in
accordance with this Agreement. For the avoidance of doubt, the Trustee shall
have no duty or responsibility with respect to the Prepayment Penalty Schedule
or to verify, recomputed, recalculate or confirm the amount of Prepayment
Penalties remitted to it by the Servicer.
Prepayment
Period:
With
respect to any Mortgage Loan and the Distribution Date in November 2006, the
calendar month immediately preceding the month in which such Distribution Date
occurs plus, in the case of any voluntary prepayment in full, the period from
and including November 1, 2006 to and including November 15, 2006. With respect
to any Mortgage Loan and each Distribution Date following the Distribution
Date
in November 2006, (1) for any principal prepayment in part or any involuntary
principal prepayment in full on any Mortgage Loan, the calendar month
immediately preceding the month in which such Distribution Date occurs, and
(2)
for any voluntary principal prepayment in full, the period beginning on the
sixteenth day of the month preceding the month of such Distribution Date through
and including the fifteenth day of the month in which such Distribution Date
occurs.
Principal
Distribution Amount:
For any
Distribution Date, the sum
of
(i)
the
principal portion of all Scheduled Payments on the Mortgage Loans due during
the
related Due Period, whether or not received on or prior to the related
Determination Date;
(ii)
the
principal portion of all proceeds received in respect of the repurchase of
a
Mortgage Loan (or, in the case of a substitution, certain amounts representing
a
principal adjustment as required by this Agreement during the related Prepayment
Period; and
(iii)
the
principal portion of all other unscheduled collections, including Insurance
Proceeds, condemnation proceeds, Liquidation Proceeds and all partial Principal
Prepayments and Principal Prepayments in full, received during the related
Prepayment Period, to the extent applied as recoveries of principal on the
Mortgage Loans, provided, that in no event will the Principal Distribution
Amount with respect to any Distribution Date be (x) less than zero or (y)
greater than the then outstanding aggregate Class Principal Balance of the
Class
A-1, Class M-1, Class M-2, Class M-3, Class M-4, Class B-1, Class B-2, Class
B-3, Class B-4 and Class B-5 Certificates.
27
Principal
Prepayment:
Any
payment of principal by a Mortgagor on a Mortgage Loan that is received in
advance of its scheduled Due Date and is not accompanied by an amount
representing scheduled interest due on any date or dates in any month or months
subsequent to the month of prepayment.
Private
Certificate:
As
specified in the Preliminary Statement.
Proceeding:
Any
suit in equity, action at law or other judicial or administrative
proceeding.
Proprietary
Lease:
With
respect to any Cooperative Property, a lease or occupancy agreement between
a
Cooperative Corporation and a holder of related Cooperative Shares.
Prospectus:
The
prospectus supplement dated October 24, 2006, together with the accompanying
prospectus dated March 14, 2006, relating to the Certificates.
Purchase
Agreement:
Each
mortgage loan purchase and warranties agreement, as amended by the related
Acknowledgement, listed in Exhibit E hereto, as such agreement may be
amended or supplemented from time to time as permitted hereunder.
Purchase
Date:
As
defined in Section 7.01(c).
Purchase
Price:
With
respect to any Mortgage Loan required or permitted to be purchased by the Seller
or Depositor pursuant to this Agreement, or by the related Originator pursuant
to the related Purchase Agreement, an amount equal to the sum of (i) 100%
of the unpaid principal balance of the Mortgage Loan on the date of such
purchase and (ii) accrued interest thereon at the applicable Net Mortgage
Rate from the date through which interest was last paid by the Mortgagor to
the
Due Date in the month in which the Purchase Price is to be distributed to
Certificateholders, or such other amount as may be specified in the related
Purchase Agreement and (iii) costs and damages incurred by the Trust Fund and
Trustee in connection with a repurchase pursuant to Section 2.05 hereof that
arises out of a violation of any predatory or abusive lending law with respect
to the related Mortgage Loan.
Rating
Agency:
Each of
the Rating Agencies specified in the Preliminary Statement. If any such
organization or a successor is no longer in existence, “Rating Agency” shall be
such nationally recognized statistical rating organization, or other comparable
Person, as is designated by the Depositor, notice of which designation shall
be
given to the Trustee. References herein to a given rating category of a Rating
Agency shall mean such rating category without giving effect to any
modifiers.
Realized
Loss:
With
respect to each Liquidated Mortgage Loan, an amount (not less than zero or
more
than the Stated Principal Balance of the related Mortgage Loan) as of the date
of such liquidation, equal to (i) the Stated Principal Balance of such Mortgage
Loan remaining outstanding (after all recoveries of principal have been applied
thereto) and the principal portion of P&I Advances made by the Servicer with
respect to such Mortgage Loan which have been reimbursed from Liquidation
Proceeds plus (ii) the accrued interest on such Mortgage Loan remaining unpaid
and the interest portion of P&I Advances made by the Servicer with respect
to such Mortgage Loan which have been reimbursed from Liquidation Proceeds.
With
respect to each Mortgage Loan which has become the subject of a Deficient
Valuation, if the principal amount due under the related Mortgage Note has
been
reduced, the difference between the principal balance of the Mortgage Loan
outstanding immediately prior to such Deficient Valuation and the principal
balance of the Mortgage Loan as reduced by the Deficient Valuation. With respect
to each Mortgage Loan which has become the subject of a Debt Service Reduction
and any Distribution Date, the amount, if any, by which the principal portion
of
the related Scheduled Payment has been reduced.
28
To
the
extent the Servicer receives Subsequent Recoveries with respect to any Mortgage
Loan, the amount of the Realized Loss with respect to that Mortgage Loan will
be
offset by such Subsequent Recoveries.
Recognition
Agreement:
An
agreement among a Cooperative Corporation, a lender and a Mortgagor with respect
to a Cooperative Loan whereby such parties (i) acknowledge that such lender
may
make, or intends to make, such Cooperative Loan, and (ii) make certain
agreements with respect to such Cooperative Loan.
Record
Date:
As to
any Distribution Date (i) with respect to the Non-Delay Certificates, the last
Business Day preceding such Distribution Date (or the Closing Date, in the
case
of the first Distribution Date) unless such Certificates shall no longer be
Book-Entry Certificates, in which case the Record Date shall be the last
Business Day of the month preceding the month of such Distribution Date and
(ii)
in the case of the Delay Certificates (including the Non-Delay Certificates
that
are subsequently reissued as Definitive Certificates), the last Business Day
of
the month preceding the month of each Distribution Date.
Redemption
Price:
With
respect to any Distribution Date, the sum of (a) 100% of the aggregate Stated
Principal Balance of the Mortgage Loans as of the related Due Date (after giving
effect to Principal Prepayments received in the related Prepayment Period),
(b)
the fair market value of any related REO Property and (c) all amounts
(including, without limitation, all previously xxxxxxxxxxxx X&X Advances and
Servicer Advances and accrued and unpaid Servicing Fees ) payable or
reimbursable to the Trustee and the Servicer pursuant to this Agreement and
the
Servicing Agreement, to each Custodian under the related Custodial Agreement
(to
the extent such amounts are not paid to such Custodian by the
Seller).
Refinancing
Mortgage Loan:
Any
Mortgage Loan originated in connection with the refinancing of an existing
mortgage loan.
Regular
Certificates:
As
specified in the Preliminary Statement.
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, 1,531 (Jan. 7, 2005)) or
by the staff of the Commission, or as may be provided by the Commission or
its
staff from time to time.
29
Released
Mortgage Loan:
As of
any transfer date as set forth in the Servicing Agreement, any Mortgage Loan
that was delinquent in payment for a period of time equal to the later to occur
of (i) 210 days or more or (ii) 30 days or more after such Mortgage Loan became
a Charged-off Loan, in each case as of the last calendar day of the month
immediately preceding the month in which such transfer date occurs, without
giving effect to any grace period permitted by the related Mortgage Note, and
for which foreclosure proceedings have not been initiated and reported by the
Servicer to the Trustee as a “Released Mortgage Loan.”
Released
Mortgage Transferee:
Initially, Xxxxxx Xxxxxxx Capital Inc., and its successors and
assigns.
Relief
Act:
The
Servicemembers Civil Relief Act (formerly known as the Soldiers’ and Sailors’
Civil Relief Act of 1940), as amended, and any similar state laws.
Relief
Act Shortfalls:
With
respect to any Distribution Date and any Mortgage Loan as to which there has
been a reduction in the amount of interest collectible thereon for the most
recently ended calendar month as a result of the application of the Relief
Act,
the amount, if any, by which (i) interest collectible on such Mortgage Loan
for the most recently ended calendar month is less than (ii) interest
accrued thereon for such month pursuant to the Mortgage Note.
REMIC:
Each
pool of assets in the Trust Fund designated as a REMIC as described in the
Preliminary Statement.
REMIC
Provisions:
The
provisions of the federal income tax law relating to real estate mortgage
investment conduits, which appear at Sections 860A through 860G of the
Code, and related provisions, and regulations, including proposed regulations
and rulings, and administrative pronouncements promulgated thereunder, as the
foregoing may be in effect from time to time.
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 or
otherwise treated as having been acquired pursuant to the REMIC
Provisions.
Replacement
Mortgage Loan:
A
mortgage loan substituted by an Originator or the Seller for a Deleted Mortgage
Loan which must, on the date of such substitution, as confirmed in a
certification by the Seller to the Trustee (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)
have a Mortgage Rate not less than (and not more than two percentage points
greater than) the Mortgage Rate 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) comply with all of the
representations and warranties set forth in the related Purchase Agreement
and
(v) shall be accompanied by an Opinion of Counsel that such Replacement
Mortgage Loan would not adversely affect the REMIC status of any REMIC created
hereunder or would not otherwise be prohibited by this Agreement.
30
Residual
Certificate:
The
Class R Certificates.
Responsible
Officer:
With
respect to the Trustee, any officer in the corporate trust department or similar
group of the Trustee with direct responsibility for the administration of this
Agreement and also, with respect to a particular corporate trust matter, any
other officer to whom such matter is referred because of his or her knowledge
of
and familiarity with the particular subject.
Restricted
Global Security:
As
defined in Section 3.01(c).
S&P:
Standard & Poor’s, a division of The XxXxxx-Xxxx Companies, Inc. If S&P
is designated as a Rating Agency in the Preliminary Statement, for purposes
of
Section 10.07 the address for notices to S&P shall be Standard & Poor’s,
00 Xxxxx Xxxxxx, Xxx Xxxx, Xxx Xxxx 00000, Attention: Mortgage Surveillance
Monitoring, or such other address as S&P may hereafter furnish to the
Depositor.
SAIF:
The
Saving’s Association Insurance Fund, or any successor thereto.
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 in the Servicing Agreement, shall give effect to any related Debt
Service Reduction and any Deficient Valuation that affects the amount of the
monthly payment due on such Mortgage Loan.
Second
Lien Loan:
A
Mortgage Loan secured by a second lien Mortgage on the related Mortgaged
Property.
Securities
Act:
The
Securities Act of 1933, as amended.
Security
Agreement:
The
agreement creating a security interest in the stock allocated to a dwelling
until in the Cooperative Corporation that was pledged to secure such Cooperative
Loan and the related Proprietary Lease.
Seller:
Xxxxxx
Xxxxxxx Mortgage Capital Inc., a New York corporation.
Senior
Certificates:
As
specified in the Preliminary Statement.
Senior
Enhancement Percentage:
For any
Distribution Date and the Senior Certificates, the percentage obtained by
dividing (x) the sum of (i) the aggregate Class Principal Balance of the
Subordinated Certificates and (ii) the Overcollateralized Amount by (y) the
aggregate Stated Principal Balance of the Mortgage Loans as of the end of the
related Due Period, calculated after taking into account distributions of
principal on the Mortgage Loans and distribution of the Principal Distribution
Amount to the holders of the Certificates then entitled to distributions of
principal on such Distribution Date.
Servicer:
The
Servicer under the Servicing Agreement, and its respective successors and
assigns. As of the Closing Date, the Servicer of the Mortgage Loans shall be
GMAC Mortgage Corporation.
31
Servicer
Advance:
A
“Servicer Advance” or “Servicing Advance” as defined in the Servicing
Agreement.
Servicing
Agreement:
As of
the Closing Date, the Servicing Agreement listed in Exhibit E hereto between
the
Seller and GMAC
Mortgage Corporation.
Servicing
Criteria:
The
“servicing criteria” set forth in Item 1122(d) of Regulation AB, which as of the
Closing Date are listed on Exhibit V hereto.
Servicing
Fee:
As to
any Distribution Date and each Mortgage Loan, an amount equal to the product
of
(a) one-twelfth of the related Servicing Fee Rate and (b) the Stated
Principal Balance of such Mortgage Loan as of the first day of the related
Due
Period. No Servicing Fee will accrue with respect to any Charged-off Loan or
any
Released Mortgage Loan.
Servicing
Fee Rate:
With
respect to each Mortgage Loan and any Distribution Date, the per annum rate
specified in the related Servicing Agreement and on the Mortgage Loan
Schedule.
Servicing
Officer:
Any
officer of the Servicer involved in, or responsible for, the administration
and
servicing of the Mortgage Loans whose name and facsimile signature appear on
a
list of servicing officers furnished to the Trustee by the Servicer on the
Closing Date pursuant to the Servicing Agreement, as such list may from time
to
time be amended.
Startup
Day:
The day
designated as such pursuant to Section 9.01(b) hereof.
Stated
Principal Balance:
As to
any Mortgage Loan and Due Date, the unpaid principal balance of such Mortgage
Loan as of such Due Date as specified in the amortization schedule at the time
relating thereto (before any adjustment to such amortization schedule by reason
of any moratorium or similar waiver or grace period) after giving effect to
any
previous partial Principal Prepayments and Liquidation Proceeds allocable to
principal (other than with respect to any Liquidated Mortgage Loan) and to
the
payment of principal due on such Due Date and irrespective of any delinquency
in
payment by the related Mortgagor.
Stepdown
Date:
The
later to occur of (x) earlier to occur of (1) the Distribution Date immediately
following the Distribution Date on which the aggregate Class Principal Balance
of the Senior Certificates is reduced to zero and (2) the Distribution Date
in
November 2009 and (y) the first Distribution Date on which the Senior
Enhancement Percentage (calculated for this purpose only after taking into
account distributions of principal on the Mortgage Loans, but prior to any
distribution of principal to the holders of the Certificates then entitled
to
distributions of principal on the Distribution Date) is greater than or equal
to
67.70%.
Subcontractor:
Any
third-party or Affiliated vendor, subcontractor or other Person utilized by
the
Servicer, that is not responsible for the overall servicing (as “servicing” is
commonly understood by participants in the mortgage-backed securities market)
of
Mortgage Loans but performs one or more discrete functions identified in Item
1122(d) of Regulation AB with respect to Mortgage Loans.
Subordinated
Certificates:
As
specified in the Preliminary Statement.
32
Subordinated
Interest Distribution Amount:
With
respect to any Class of Subordinated Certificates and any Distribution Date,
interest accrued during the related Interest Accrual Period on the related
Class
Principal Balance of that Class immediately prior to the Distribution Date
at
the Pass-Through Rate for that Class reduced (to an amount not less than zero),
in the case of such Class, by the allocable share, if any, for that Class of
(x)
Prepayment Interest Shortfalls on the Mortgage Loans to the extent not covered
by Compensating Interest Payments paid by the Servicer and (y) Relief Act
Interest Shortfalls.
Subsequent
Recoveries:
As to
any Distribution Date, with respect to a Liquidated Mortgage Loan (other than
a
Released Mortgage Loan) that resulted in a Realized Loss in a prior calendar
month, amounts received by the Trustee from the Servicer (net of any related
expenses permitted to be reimbursed pursuant to Section 4.02) specifically
related to such Liquidated Mortgage Loan.
Subservicer:
Any
Person that services Mortgage Loans on behalf of the Servicer, as applicable,
or
any Subservicer and is responsible for the performance (whether directly or
through Subservicers or Subcontractors) of a substantial portion of the material
servicing functions required to be performed by the Servicer under the Servicing
Agreement, with respect to some or all of the Mortgage Loans, that are
identified in Item 1122(d) of Regulation AB.
Subservicing
Account:
As
defined in the Servicing Agreement,
Subsidiary
REMIC:
As
specified in the Preliminary Statement.
Subsidiary
REMIC Interest:
As
specified in the Preliminary Statement.
Subsidiary
REMIC Regular Interest:
As
specified in the Preliminary Statement.
Substitution
Adjustment Amount:
As
defined in the second paragraph of Section 2.05(c).
Tax
Matters Person:
The
person designated as “tax matters person” in the manner provided under Treasury
regulation § 1.860F-4(d) and temporary Treasury regulation §301.6231(a)(7)1T.
Tax
Matters Person Certificate:
The
Class R Certificate with a Denomination of $0.01.
Telerate
Page 3750:
The
display page currently so designated on the Moneyline Telerate Service (formerly
the Dow Xxxxx Markets) (or such other page as may replace that page on that
service for the purpose of displaying comparable rates or prices)
Three
Month Rolling Average:
With
respect to the end of the Due Period related to any Distribution Date, the
rolling 3 month average percentage of the aggregate Stated Principal Balance
of
the Mortgage Loans that are 60 or more days Delinquent (including Mortgage
Loans
in foreclosure, REO Property or discharged in bankruptcy).
Trigger
Event:
With
respect to any Distribution Date, a Trigger Event is in effect if (x) the Three
Month Rolling Average with respect to the Mortgage Loans exceeds 11.82% of
the
Senior Enhancement Percentage for the prior Distribution Date, or (y) the
aggregate amount of Realized Losses on the Mortgage Loans incurred since the
Cut-off Date through the last day of the related Prepayment Period divided
by
the aggregate outstanding principal balance of the Mortgage Loans as of the
Cut-off exceeds the applicable percentages set forth below with respect to
such
Distribution Date:
33
|
Distribution
Date
|
Percentage
|
|
November
2008 — October 2009
|
2.25%
with respect to November 2008, plus an additional 0.23333% for each
month
thereafter
|
|
November
2009 — October 2010
|
5.05%
with respect to November 2009, plus an additional 0.23333% for each
month
thereafter
|
|
November
2010 — October 2011
|
7.85%
with respect to November 2010, plus an additional 0.15833% for each
month
thereafter
|
|
November
2011 — October 2012
|
9.75%
with respect to November 2011, plus an additional 0.06250% for each
month
thereafter
|
|
November
2012 and thereafter
|
10.50%
|
Trust
Fund:
The
corpus of the trust created pursuant to this Agreement consisting of (i) the
Mortgage Loans and all interest and principal received on or with respect
thereto after the Cut-off Date (other than Scheduled Payments due on or prior
to
the Cut-off Date) to the extent not applied in computing the Cut-off Date
Principal Balance thereof; (ii) all cash, instruments or property held or
required to be held in the Custodial Accounts and the Distribution Account
and
all amounts deposited therein pursuant to the applicable provisions of this
Agreement; (iii) property that secured a Mortgage Loan and has been acquired
by
foreclosure, deed-in-lieu of foreclosure or otherwise; (iv) the Depositor’s
rights assigned to the Trustee under the Purchase Agreements and Servicing
Agreements, each as modified by the Acknowledgements, and under this Agreement
and the Custodial Agreements; (v) all insurance policies related to the Mortgage
Loans and any insurance proceeds; and (vi) all proceeds of the conversion,
voluntary or involuntary, of any of the foregoing.
Trustee:
LaSalle
Bank National Association, a national banking association, organized under
the
laws of the United States, in its capacity as Trustee hereunder, and any Person
succeeding the Trustee hereunder, or if any successor trustee or any co-trustee
shall be appointed as herein provided, then such successor trustee and such
co-trustee, as the case may be.
34
Trustee
Mortgage Files:
With
respect to each Mortgage Loan, the Mortgage Documents to be retained in the
custody and possession of the Trustee or the applicable Custodian on behalf
of
the Trustee.
UCC:
The
Uniform Commercial Code as enacted in the relevant jurisdiction.
Underwriter:
As
specified in the Preliminary Statement.
Underwriter’s
Exemption:
Prohibited Transaction Exemption 2002-41, 67 Fed. Reg. 54487 (2002), as amended
(or any successor thereto), or any substantially similar administrative
exemption granted by the U.S. Department of Labor.
Uniform
Commercial Code:
The
Uniform Commercial Code as in effect in any applicable jurisdiction from time
to
time.
Unpaid
Realized Loss Amount:
For any
of the Class M-1, Class M-2, Class M-3, Class M-4, Class B-1, Class B-2, Class
B-3, Class B-4 or Class B-5 Certificates, the portion of any Realized Losses
previously allocated to that Class remaining unpaid from prior Distribution
Dates.
Voting
Interests:
The
portion of the voting rights of all the Certificates that is allocated to any
Certificate for purposes of the voting provisions of this Agreement. At all
times during the term of this Agreement, 98.00% of all Voting Interests shall
be
allocated to the Offered Certificates and the Class B4, Class B5 and Class
R
Certificates. The portion of such 98% of the Voting Interests allocated among
the Offered Certificates and the Class B4 and Class B5 Certificates shall be
based on the fraction, expressed as a percentage, the numerator of which is
the
aggregate Class Principal Balance of the Offered Certificates and the Class
B4
and Class B5 Certificates then outstanding and the denominator of which is
the
aggregate Stated Principal Balance of the Mortgage Loans. The portion of such
98% of the Voting Interests allocated to the Class R Certificates shall equal
one minus the percentage determined in accordance with the immediately preceding
sentence. At all times during the term of this Agreement, 1.00% of all Voting
Interests shall be allocated to each of the Class P and Class OC Certificates
while they remain outstanding. To the extent required, Voting Interests shall
be
further allocated among the Classes of Certificates (and among the Certificates
within each such Class) in proportion to their Class Principal Balances (or
Certificate Balances) or Percentage Interests.
Weighted
Average Net Mortgage Rate:
As to
any Distribution Date, the average of the Net Mortgage Rate of each Mortgage
Loan, weighted on the basis of its Stated Principal Balance as of the end of
the
Prepayment Period related to the immediately preceding Distribution
Date.
35
ARTICLE
II
DECLARATION
OF TRUST;
ISSUANCE
OF CERTIFICATES
Section
2.01 Creation
and Declaration of Trust Fund; Conveyance of Mortgage Loans.
(a) Concurrently
with the execution and delivery of this Agreement, the Depositor does hereby
transfer, assign, set over, deposit with and otherwise convey to the Trustee,
without recourse, subject to Sections 2.02 and 2.05, in trust, all the
right, title and interest of the Depositor in and to the Trust Fund. Such
conveyance includes, without limitation, (i) the Mortgage Loans, including
the right to all payments of principal and interest received on or with respect
to the Mortgage Loans on and after the Cut-off Date (other than Scheduled
Payments due on or before such date), and all such payments due after such
date
but received prior to such date and intended by the related Mortgagors to be
applied after such date; (ii) all of the Depositor’s right, title and
interest in and to all amounts from time to time credited to and the proceeds
of
the Distribution Account, any Custodial Accounts or any Escrow Account
established with respect to the Mortgage Loans; (iii) all of the rights and
obligations of the Depositor as assignee of the Seller with respect to the
Seller’s rights and obligations under the Purchase Agreements and Servicing
Agreement pursuant to the Acknowledgements; (iv) all of the Depositor’s
right, title or interest in REO Property and the proceeds thereof; (v) all
of the Depositor’s rights under any Insurance Policies related to the Mortgage
Loans; (vi) $100 (which amount has been delivered by the Depositor to the
Trustee to be held in the Distribution Account until distributed to the Holders
of the Class P Certificates pursuant to Section 5.02(d)); and (vii) if
applicable, the Depositor’s security interest in any collateral pledged to
secure the Mortgage Loans, including the Mortgaged Properties, to have and
to
hold, in trust; and the Trustee declares that, subject to the review provided
for in Section 2.02, it has received and shall hold the Trust Fund, as
trustee, in trust, for the benefit and use of the Holders of the Certificates
and for the purposes and subject to the terms and conditions set forth in this
Agreement, and, concurrently with such receipt, has caused to be executed,
authenticated and delivered to or upon the order of the Depositor, in exchange
for the Trust Fund, Certificates in the authorized denominations evidencing
the
entire ownership of the Trust Fund.
The
foregoing sale, transfer, assignment, set-over, deposit and conveyance does
not
and is not intended to result in the creation or assumption by the Trustee
of
any obligation of the Depositor, the Seller or any other Person in connection
with the Mortgage Loans or any other agreement or instrument relating thereto
except as specifically set forth therein.
In
connection with such transfer and assignment of the Mortgage Loans, each
Custodian acting on the Trustee’s behalf, will continue to hold the applicable
documents or instruments listed below with respect to each related Mortgage
Loan
(each, a “Trustee
Mortgage File”)
so
transferred and assigned:
36
(i)
with
respect to each Mortgage Loan, the original Mortgage Note endorsed without
recourse in proper form to the order of the Trustee, or in blank (in each case,
with all necessary intervening endorsements, as applicable);
(ii)
with
respect to each Mortgage Loan (other than a Cooperative Loan) that is not a
MERS
Mortgage Loan, the original Mortgage with evidence of recording thereon, or
if
the original Mortgage has not yet been returned from the recording office,
a
copy of such Mortgage certified by the applicable Originator, title company,
escrow agent or closing attorney to be a true copy of the original of the
Mortgage which has been sent for recording in the appropriate jurisdiction
in
which the Mortgaged Property is located, and in the case of the each MERS
Mortgage Loan, the original Mortgage, noting the presence of the MIN of the
Mortgage Loans and either language indicating that the Mortgage Loan is a MOM
Loan if the Mortgage Loan is a MOM Loan or if the Mortgage Loan was not a MOM
Loan at origination, the original Mortgage and the assignment thereof to MERS,
with evidence of recording indicated thereon;
(iii)
with respect to each Mortgage Loan (other than a Cooperative Loan) that is
not a
MERS Mortgage Loan, the Assignment of Mortgage in form and substance acceptable
for recording in the relevant jurisdiction, such assignment being either (A)
in
blank, without recourse, or (B) endorsed to “LaSalle Bank National Association,
as Trustee of Xxxxxx Xxxxxxx Mortgage Loan Trust 2006-14SL, Mortgage
Pass-Through Certificates, without recourse”;
(iv)
with
respect to each Mortgage Loan (other than a Cooperative Loan) that is not a
MERS
Mortgage Loan, the originals of all intervening assignments of the Mortgage,
if
any, with evidence of recording thereon, or if the original intervening
assignment has not yet been returned from the recording office, a copy of such
assignment certified by the applicable Originator, title company, escrow agent
or closing attorney to be a true copy of the original of the assignment which
has been sent for recording in the appropriate jurisdiction in which the
Mortgaged Property is located;
(v)
with
respect to each Mortgage Loan (other than a Cooperative Loan), the originals
of
all assumption, modification, consolidation or extension agreements, if any,
with evidence of recording thereon;
(vi)
if
any, with respect to each Mortgage Loan (other than a Cooperative Loan), the
original policy of title insurance (or a true copy thereof) with respect to
any
such Mortgage Loan, or, if such policy has not yet been delivered by the
insurer, the title commitment or title binder to issue same;
(vii)
if
any, with respect to each Mortgage Loan (other than a Cooperative Loan), the
original power of attorney and guaranty agreement with respect to such Mortgage
Loan;
(viii)
with respect to each Mortgage Loan which constitutes a Cooperative
Loan:
(a)
the
original of any Security Agreement or similar document executed in connection
with the Cooperative Loan;
(b)
the
original Recognition Agreement and the original Assignment of Recognition
Agreement;
37
(c)
UCC-1
financing statements with recording information thereon from the appropriate
governmental recording offices if necessary to perfect the security interest
of
the Cooperative Loan under the Uniform Commercial Code in the jurisdiction
in
which the Cooperative Property is located, accompanied by UCC-3 financing
statements executed in blank for recordation of the change in the secured party
thereunder;
(d)
an
Estoppel Letter and/or Consent;
(e)
a
search for (i) federal tax liens, mechanics’ liens, lis
pendens,
judgments of record or otherwise against (x) the Cooperative Corporation and
(y)
the seller of the Cooperative Unit, (ii) filings of financing statements and
(iii) the deed of the cooperative project into the Cooperative
Corporation;
(f)
the
guaranty of the Mortgage Note and Cooperative Loan, if any;
(g)
the
original Proprietary Lease and the Assignment of Proprietary Lease executed
by
the Mortgagor in blank or if the Proprietary Lease has been assigned by the
Mortgagor to the Seller, then the Seller must execute an assignment of the
Assignment of Proprietary Lease in blank; and
(h)
if
any, the original or certified copy of the certificates evidencing ownership
of
the Cooperative Shares issued by the Cooperative Corporation and related
assignment of such certificates or an assignment of such Cooperative Shares,
in
blank, executed by the Mortgagor with such signature guaranteed.
(ix)
Any
other document or instruments required to be delivered under the related
Custodial Agreement.
Notwithstanding
the foregoing, in the event of any inconsistency between any provision of this
Agreement and a provision of either Custodial Agreement, then the provision
of
the Custodial Agreement shall control.
In
addition, in connection with the assignment of any MERS Mortgage Loan, it is
understood that the related Originator will cause the MERS® System to indicate
that such Mortgage Loans have been assigned by the related Originator to the
Trustee in accordance with this Agreement for the benefit of the
Certificateholders by including (or deleting, in the case of Mortgage Loans
which are repurchased in accordance with this Agreement) in such computer files
the information required by the MERS® System to identify the series of
Certificates issued in connection with such Mortgage Loans. It is further
understood that the related Originator will not, and the Trustee hereby agrees
that it will not alter the information referenced in this paragraph with respect
to any Mortgage Loan during the term of this Agreement unless and until such
Mortgage Loan is repurchased in accordance with the terms of this
Agreement.
(b) In
instances where a title insurance policy is required to be delivered to the
applicable Custodian on behalf of the Trustee and is not so delivered, the
Depositor will provide a copy of such title insurance policy to the applicable
Custodian on behalf of the Trustee, as promptly as practicable after the
execution and delivery hereof, but in any case within 180 days of the Closing
Date.
38
(c) For
Mortgage Loans (if any) that have been prepaid in full after the Cut-off Date
and prior to the Closing Date, the Depositor, in lieu of delivering the above
documents, herewith delivers such amount to the Trustee, and delivers to the
Trustee and the applicable Custodian, an Officer’s Certificate which shall
include a statement to the effect that all amounts received in connection with
such prepayment that are required to be deposited in the Distribution Account
pursuant to Section 4.01 have been so deposited. All original documents
that are not delivered to the applicable Custodian on behalf of the Trustee
shall be held by the related Originator in trust for the benefit of the Trustee
and the Certificateholders.
(d) Neither
the Depositor nor the Trust will acquire or hold any Mortgage Loan that would
violate the representations made by the Seller set forth in clauses (iv) through
(vi) of Section 2.05(b) hereof.
Section
2.02 Acceptance
of Trust Fund by Trustee; Review of Documentation for Trust Fund.
(a) The
Trustee, by execution and delivery hereof, acknowledges receipt by it of notice
from each Custodian that each holds the documents identified in the Initial
Certification in the form annexed to the applicable Custodial Agreement (the
“Initial
Certification”)
pertaining to the Mortgage Loans listed on the Mortgage Loan Schedule.
(b) Nothing
in this Agreement shall be construed to constitute an assumption by the Trust
Fund, the Trustee, the Custodians or the Certificateholders of any unsatisfied
duty, claim or other liability on any Mortgage Loan or to any
Mortgagor.
(c) Each
of
the parties hereto acknowledges that (i) each Custodian has delivered to the
Depositor and the Trustee, the related Initial Certification, stating that
it
has performed the applicable review of the Mortgage Loans as required under
the
applicable Custodial Agreement on the Closing Date and (ii) thereafter, if
applicable, each Custodian shall perform the applicable review of the Mortgage
Loans and deliver the further certifications as provided in the applicable
Custodial Agreement, as applicable.
(d) Upon
execution of this Agreement, the Depositor hereby delivers to the Trustee and
the Trustee acknowledges receipt of the Acknowledgements, together with the
related Purchase Agreements and the Servicing Agreement.
Section
2.03 Representations
and Warranties of the Depositor.
(a) The
Depositor hereby represents and warrants to the Trustee, for the benefit of
the
Certificateholders, as of the Closing Date or such other date as is specified,
that:
(i) the
Depositor is a corporation duly organized, validly existing and in good standing
under the laws governing its creation and existence and has full corporate
power
and authority to own its property, to carry on its business as presently
conducted, to enter into and perform its obligations under this Agreement,
and
to create the trust pursuant hereto;
39
(ii) the
execution and delivery by the Depositor of this Agreement have been duly
authorized by all necessary corporate action on the part of the Depositor;
neither the execution and delivery of this Agreement, nor the consummation
of
the transactions herein contemplated, nor compliance with the provisions hereof,
will conflict with or result in a breach of, or constitute a default under,
any
of the provisions of any law, governmental rule, regulation, judgment, decree
or
order binding on the Depositor or its properties or the certificate of
incorporation or bylaws of the Depositor;
(iii) the
execution, delivery and performance by the Depositor of this Agreement and
the
consummation of the transactions contemplated hereby do not require the consent
or approval of, the giving of notice to, the registration with, or the taking
of
any other action in respect of, any state, federal or other governmental
authority or agency, except such as has been obtained, given, effected or taken
prior to the date hereof;
(iv) this
Agreement has been duly executed and delivered by the Depositor and, assuming
due authorization, execution and delivery by the Trustee, constitutes a valid
and binding obligation of the Depositor enforceable against it in accordance
with its terms except as such enforceability may be subject to
(A) applicable bankruptcy and insolvency laws and other similar laws
affecting the enforcement of the rights of creditors generally and
(B) general principles of equity regardless of whether such enforcement is
considered in a proceeding in equity or at law;
(v) there
are
no actions, suits or proceedings pending or, to the knowledge of the Depositor,
threatened or likely to be asserted against or affecting the Depositor, before
or by any court, administrative agency, arbitrator or governmental body
(A) with respect to any of the transactions contemplated by this Agreement
or (B) with respect to any other matter which in the judgment of the
Depositor will be determined adversely to the Depositor and will if determined
adversely to the Depositor materially and adversely affect it or its business,
assets, operations or condition, financial or otherwise, or adversely affect
its
ability to perform its obligations under this Agreement;
(vi) immediately
prior to the transfer and assignment of the Mortgage Loans to the Trustee,
the
Depositor was the sole owner of record and holder of each Mortgage Loan, and
the
Depositor had good and marketable title thereto, and had full right to transfer
and sell each Mortgage Loan to the Trustee free and clear, subject only to
(1) liens of current real property taxes and assessments not yet due and
payable and, if the related Mortgaged Property is a condominium unit, any lien
for common charges permitted by statute, (2) covenants, conditions and
restrictions, rights of way, easements and other matters of public record as
of
the date of recording of such Mortgage acceptable to mortgage lending
institutions in the area in which the related Mortgaged Property is located
and
specifically referred to in the lender’s title insurance policy or attorney’s
opinion of title and abstract of title delivered to the originator of such
Mortgage Loan, and (3) such other matters to which like properties are
commonly subject which do not, individually or in the aggregate, materially
interfere with the benefits of the security intended to be provided by the
Mortgage, of any encumbrance, equity, participation interest, lien, pledge,
charge, claim or security interest, and had full right and authority, subject
to
no interest or participation of, or agreement with, any other party, to sell
and
assign each Mortgage Loan pursuant to this Agreement;
40
(vii) This
Agreement creates a valid and continuing security interest (as defined in the
applicable UCC,) in the Mortgage Loans in favor of the Trustee, which security
interest is prior to all other liens, and is enforceable as such against
creditors of and purchasers from the Depositor;
(viii) The
Mortgage Loans constitute “instruments” within the meaning of the applicable
UCC;
(ix) Other
than the security interest granted to the Trustee pursuant to this Agreement,
the Depositor has not pledged, assigned, sold, granted a security interest
in,
or otherwise conveyed any of the Mortgage Loans. The Depositor has not
authorized the filing of and is not aware of any financing statement against
the
Depositor that includes a description of the collateral covering the Mortgage
Loans other than a financing statement relating to the security interest granted
to the Trustee hereunder or that has been terminated. The Depositor is not
aware
of any judgment or tax lien filings against the Depositor;
(x) None
of
the Mortgage Loans has any marks or notations indicating that such Mortgage
Loans have been pledged, assigned or otherwise conveyed to any Person other
than
the Trustee; and
(xi) The
Depositor has received all consents and approvals required by the terms of
the
Mortgage Loans to convey the Mortgage Loans hereunder to the
Trustee.
The
foregoing representations made in this Section 2.03 shall survive the
termination of this Agreement and shall not be waived by any party
hereto.
Section
2.04 Representations
and Warranties of the Depositor and the Seller as to the Mortgage
Loans.
The
Depositor hereby represents and warrants to the Trustee with respect to the
Mortgage Loans or each Mortgage Loan, as the case may be, as of the date hereof
or such other date set forth herein that as of the Closing Date:
41
(a)
Immediately prior to the transfer and assignment contemplated herein, the
Depositor was the sole owner and holder of the Mortgage Loans. The Mortgage
Loans were not assigned or pledged by the Depositor and the Depositor had good
and marketable title thereto, and the Depositor had full right to transfer
and
sell the Mortgage Loans to the Trustee free and clear of any encumbrance,
participation interest, lien, equity, pledge, claim or security interest and
had
full right and authority subject to no interest or participation in, or
agreement with any other party to sell or otherwise transfer the Mortgage
Loans.
(b)
As of
the Closing Date, the Depositor has transferred all right, title and interest
in
the Mortgage Loans to the Trustee on behalf of the Trust.
(c)
As of
the Closing Date, the Depositor has not transferred the Mortgage Loans to the
Trustee on behalf of the Trust with any intent to hinder, delay or defraud
an of
its creditors.
It
is
understood and agreed that the representations and warranties set forth in
this
Section 2.04 shall survive delivery of the respective Mortgage Files to the
Trustee or the related Custodian and shall inure to the benefit of the Trustee,
notwithstanding any restrictive or qualified endorsement or
assignment.
Section
2.05 Representations
and Warranties of the Seller; Discovery of Breach; Repurchase or Substitution
of
Mortgage Loans.
(a) With
respect to the Aames Mortgage Loans, the Seller hereby makes the representations
and warranties contained in Section 9.01 of the Xxxx Purchase Agreement with
respect to each of the Aames Mortgage Loans to and for the benefit of the
Depositor, the Trustee and the Trust Fund. The Seller agrees to comply with
the
provisions of Section 9.03 of
the
Aames Purchase Agreement in respect of a breach of any of such representations
and warranties. In addition, with respect to the Aames Mortgage Loans, the
Seller hereby represents and warrants that each such Aames Mortgage Loan is
a
“qualified mortgage” within the meaning of Section 860G(a)(3) of the
Code.
With
respect to the Aegis Mortgage Loans, the Seller hereby makes the representations
and warranties contained in Section 5.01 of the Aegis Purchase Agreement with
respect to each of the Aegis Mortgage Loans to and for the benefit of the
Depositor, the Trustee and the Trust Fund. The Seller agrees to comply with
the
provisions of Section 6.01 of the Aegis Purchase Agreement in respect of a
breach of any of such representations and warranties. In addition, with respect
to the Aegis Mortgage Loans, the Seller hereby represents and warrants that
each
such Mortgage Loan is a “qualified mortgage” within the meaning of Section
860G(a)(3) of the Code.
With
respect to the Decision One Mortgage Loans, the Seller hereby makes the
representations and warranties contained in Section 9.01 of the Decision One
Purchase Agreement with respect to each of the Decision One Mortgage Loans
to
and for the benefit of the Depositor, the Trustee and the Trust Fund. The Seller
agrees to comply with the provisions of Section 9.03 of the Decision One
Purchase Agreement in respect of a breach of any of such representations and
warranties. In addition, with respect to the Decision One Mortgage Loans, the
Seller hereby represents and warrants that each such Mortgage Loan is a
“qualified mortgage” within the meaning of Section 860G(a)(3) of the
Code.
42
The
Seller agrees to comply with the provisions of this Section 2.05 in respect
of a
breach of any of such representations and warranties.
(b) The
Seller hereby represents and warrants to the Trustee with respect to the
Mortgage Loans as of the date hereof or such other date set forth herein that
as
of the Closing Date:
(i) Each
Mortgage Loan at origination complied in all material respects with applicable
predatory and abusive lending laws and consummation of the transactions
contemplated by this Agreement will not involve the violation of any such
laws.
(ii) All
of
the Mortgage Loans were originated in compliance with all applicable laws,
including, but not limited to, all applicable anti-predatory and abusive lending
laws.
(iii) None
of
the Mortgage Loans is covered by the Home Ownership and Equity Protection Act
of
1994.
(iv) None
of
the Mortgage Loans is a “high cost” loan as defined by applicable predatory and
abusive lending laws.
(v) No
Mortgage Loan is a High Cost Loan or Covered Loan, as applicable, and with
respect to the foregoing, the terms "High Cost Loan" and "Covered Loan" have
the
meaning assigned to them in the then current version of Standard & Poor’s
LEVELS®, Appendix E which is attached hereto as Exhibit Q (the "Glossary") where
(x) a "High Cost Loan" is each loan identified in the column "Category under
applicable anti-predatory lending law" of the table entitled "Standard &
Poor's High Cost Loan Categorization" in the Glossary as each such loan is
defined in the applicable anti-predatory lending law of the State or
jurisdiction specified in such table and (y) a "Covered Loan" is each loan
identified in the column "Category under applicable anti-predatory lending
law"
of the table entitled "Standard & Poor's High Covered Loan Categorization"
in the Glossary as each such loan is defined in the applicable anti-predatory
lending law of the State or jurisdiction specified in such table.
(vi) No
Mortgage Loan originated on or after October 1, 2002 through March 6, 2003
is
governed by the Georgia Fair Lending Act.
Upon
discovery by the Depositor, the Seller or the related Originator or receipt
of
written notice of any materially defective document in, or, following the date
of delivery to the Trustee of the Custodian’s certifications as required under
the related Custodial Agreement, that a document is missing from, a Trustee
Mortgage File, or discovery by the Trustee, the Depositor, the Seller or the
related Originator of the breach by such Originator or Seller of any
representation or warranty under the related Purchase Agreement, as modified
by
the Acknowledgement, in the case of the Originator, or under this Agreement,
in
the case of the Seller, in respect of any Mortgage Loan which materially
adversely affects the value of that
43
Mortgage
Loan or the interest therein of the Certificateholders (a “Defective
Mortgage Loan”)
(each
of the Depositor, the Seller and the related Originator hereby agreeing to
give
written notice thereof to the Trustee and the other of such parties), the
Trustee, or the applicable Custodian, shall promptly notify the Depositor and
the Seller or the related Originator, as applicable, in writing of such
nonconforming or missing document or breach and request that the Seller or
related Originator deliver such missing document or cure or cause the cure
of
such defect or breach within a period of time specified in the related Purchase
Agreement, and if the Seller or related Originator, as applicable, does not
deliver such missing document or cure such defect or breach in all material
respects during such period, the Trustee, shall notify the Depositor of such
and, in consultation with the Depositor, undertake commercially reasonable
efforts to enforce the obligations of the related Originator under the related
Purchase Agreement, as modified by the Acknowledgement, or the Seller under
this
Agreement, as applicable, and cause the related Originator or the Seller, as
the
case may be, to repurchase that Mortgage Loan from the Trust Fund at the
Purchase Price on or prior to the Determination Date following the expiration
of
such specified period (subject to Section 2.05(d) below); provided,
however,
that,
in connection with any such breach that could not reasonably have been cured
within such specified period (unless permitted a greater period of time to
cure
under the related Purchase Agreement), subject to Section 2.05(d) below, if
the
related Originator or the Seller, as applicable, shall have commenced to cure
such breach within such specified period, the related Originator or the Seller
shall be permitted to proceed thereafter diligently and expeditiously to cure
the same within such additional time as is reasonably necessary to cure such
breach. To the extent that any costs and damages are 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 any Mortgage Loan repurchased by the related Originator or the
Seller, such costs and damages shall be included in the Purchase Price of such
repurchased Mortgage Loan and shall be borne by the Seller. With respect to
a
breach of a representation or warranty of by the related Originator under the
related Purchase Agreement, if that Originator fails to cure the breach or
repurchase the affected Mortgage Loan within the time period required by such
Purchase Agreement, the Seller hereby agrees to honor that Originator’s cure
obligations. The Purchase Price for the repurchased Mortgage Loan shall be
deposited in the related Distribution Account, and the Trustee shall cause
the
related Custodian to release to the related Originator or the Seller, as
applicable, the related Trustee Mortgage File and shall execute and deliver
such
instruments of transfer or assignment, in each case without recourse,
representation or warranties, as either party shall furnish to it and as shall
be necessary to vest in such party any Mortgage Loan released pursuant hereto
and the Trustee, and the related Custodian, shall have no further responsibility
with regard to such Trustee Mortgage File (it being understood that the Trustee
shall have no responsibility for determining the sufficiency of such assignment
for its intended purpose). If pursuant to the foregoing provisions the related
Originator or the Seller repurchases a Mortgage Loan that is a MERS Mortgage
Loan, the Servicer shall cause MERS to designate on the MERS® System the related
Originator or the Seller, as applicable, as the beneficial holder of such
Mortgage Loan.
In
lieu
of repurchasing any such Mortgage Loan as provided above, the Originator or
the
Seller may cause such Mortgage Loan to be removed from the Trust Fund (in which
case it shall become a Deleted Mortgage Loan) and substitute one or more
Replacement Mortgage Loans in the manner and subject to the limitations set
forth in Section 2.05(c) below. It is understood and agreed that the
obligations of the Originators and the Seller to cure or to repurchase (or
to
substitute for) any related Mortgage Loan as to which a document is missing,
a
material defect in a constituent document exists or as to which such a breach
has occurred and is continuing shall constitute the sole remedy against the
such
party respecting such omission, defect or breach available to the Trustee on
behalf of the Certificateholders.
44
(c) Any
substitution of Replacement Mortgage Loans for Deleted Mortgage Loans made
pursuant to Section 2.05(b) above must be effected prior to the last
Business Day that is within two years after the Closing Date. As to any Deleted
Mortgage Loan for which the related Originator or the Seller substitutes a
Replacement Mortgage Loan or Loans, such substitution shall be effected by
delivering to the related Custodian, on behalf of the Trustee, for such
Replacement Mortgage Loan or Loans, the Mortgage Note, the Mortgage, any related
assignment thereof and the Acknowledgement to the Trustee, and such other
documents and agreements, with all necessary endorsements thereon, together
with
an Officers’ Certificate stating that each such Replacement Mortgage Loan
satisfies the definition thereof and specifying the Substitution Adjustment
Amount (as described below), if any, in connection with such substitution.
Monthly Payments due with respect to Replacement Mortgage Loans in the month
of
substitution shall not be included as part of the Trust Fund and shall be
retained by the related Originator or the Seller, as applicable. For the month
of substitution, distributions to the Certificateholders shall reflect the
collections and recoveries in respect of such Deleted Mortgage in the Due Period
preceding the month of substitution and the related Originator or the Seller,
as
applicable, shall thereafter be entitled to retain all amounts subsequently
received in respect of such Deleted Mortgage Loan. Upon such substitution,
such
Replacement Mortgage Loan shall constitute part of the Trust Fund and shall
be
subject in all respects to the terms of this Agreement and the related Purchase
Agreement, as modified by the related Acknowledgement, including all
representations and warranties thereof included in such Purchase Agreement,
as
modified by the Acknowledgement, in each case as of the date of
substitution.
For
any
month in which an Originator or the Seller substitutes one or more Replacement
Mortgage Loans for one or more Deleted Mortgage Loans, the Servicer shall
determine the excess (each, a “Substitution
Adjustment Amount”),
if
any, by which the aggregate Purchase Price of all such Deleted Mortgage Loans
exceeds the aggregate Stated Principal Balance of the Replacement Mortgage
Loans
replacing such Deleted Mortgage Loans, together with one month’s interest on
such excess amount at the applicable Net Mortgage Rate. On the date of such
substitution, the related Originator or Seller, as applicable, shall deliver
or
cause to be delivered to the Servicer for deposit in the related Custodial
Account an amount equal to the related Substitution Adjustment Amount, if any,
and the related Custodian, on behalf of the Trustee, upon receipt of the related
Replacement Mortgage Loan or Loans and certification by the Servicer of such
deposit, shall release to the related Originator or the Seller, as applicable,
the related Trustee Mortgage File or Files and shall execute and deliver such
instruments of transfer or assignment, in each case without recourse, as the
related Originator or Seller shall deliver to it and as shall be necessary
to
vest therein any Deleted Mortgage Loan released pursuant hereto.
In
addition, the related Originator or the Seller, as applicable, shall obtain
at
its own expense and deliver to the Trustee an Opinion of Counsel to the effect
that such substitution (either specifically or as a class of transactions)
shall
not cause an Adverse REMIC Event. If such Opinion of Counsel cannot be
delivered, then such substitution may only be effected at such time as the
required Opinion of Counsel can be given.
45
(d) Upon
discovery by the related Originator, the Seller, the Depositor or the Trustee
that any Mortgage Loan does not constitute a “qualified mortgage” within the
meaning of Section 860G(a)(3) of the Code, the party discovering such fact
shall within two Business Days give written notice thereof to the other parties.
In connection therewith, the applicable Originator or the Seller shall
repurchase or, subject to the limitations set forth in Section 2.05(c),
substitute one or more Replacement Mortgage Loans for the affected Mortgage
Loan
within 90 days of the earlier of discovery or receipt of such notice with
respect to such affected Mortgage Loan. Any such repurchase or substitution
shall be made in the same manner as set forth in Section 2.05(d) above
and/or in accordance with this Section 2.05(d). The Trustee shall re-convey
to
the related Originator or the Seller, as applicable, the Mortgage Loan to be
released pursuant hereto in the same manner, and on the same terms and
conditions, as it would a Mortgage Loan repurchased for breach of a
representation or warranty.
Section
2.06 Grant
Clause.
(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 in all
of
the Depositor’s right, title and interest in, to and under, whether now owned or
hereafter acquired, the Trust Fund and all proceeds of any and all property
constituting the Trust Fund to secure payment of the Certificates; and
(3) this Agreement shall constitute a security agreement under applicable
law. 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 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 will
be
maintained as such throughout the term of this Agreement. The Depositor will,
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 an Originator, the Depositor or the
Trustee, (2) any change of location of the place of business or the chief
executive office of the Seller or the Depositor, (3) any transfer of any
interest of an Originator or the Depositor in any Mortgage Loan or (4) any
change under the relevant UCC or other applicable laws. Neither the Originators
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,
any Originator 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 Originators and the Depositor authorizes its
immediate or intermediate transferee (but not the Trustee) 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).
46
ARTICLE
III
THE
CERTIFICATES
Section
3.01 The
Certificates.
(a) The
Certificates shall be issuable in registered form only and shall be securities
governed by Article 8 of the New York Uniform Commercial Code. The Book-Entry
Certificates will be evidenced by one or more certificates, beneficial ownership
of which will be held in the dollar denominations in Certificate Balance, or
in
the Percentage Interests, specified herein. Each Class of Certificates will
be
issued in the minimum denominations and integral multiples thereof of the
initial Certificate Balance specified in the Preliminary Statement hereto.
(b) The
Certificates shall be executed by manual or facsimile signature on behalf of
the
Trustee by an authorized officer of the Trustee. Each Certificate shall, on
original issue, be authenticated by the Authenticating Agent upon the order
of
the Depositor upon receipt by the Trustee of the Trustee Mortgage Files
described in Section 2.01. No Certificate shall be entitled to any benefit
under this Agreement, or be valid for any purpose, unless there appears on
such
Certificate a certificate of authentication substantially in the form provided
for herein, executed by an authorized officer of the Authenticating Agent,
by
manual signature, and such certification upon any Certificate shall be
conclusive evidence, and the only evidence, that such Certificate has been
duly
authenticated and delivered hereunder. All Certificates shall be dated the
date
of their authentication. At any time and from time to time after the execution
and delivery of this Agreement, the Depositor may deliver Certificates executed
by or on behalf of the Trustee to the Authenticating Agent for authentication
and the Authenticating Agent shall authenticate and deliver such Certificates
as
in this Agreement provided and not otherwise.
(c) The
Class
OC, Class B-4, Class B-5, Class P and Class R Certificates offered
and sold in reliance on the exemption from registration under Rule 144A
under the Securities Act shall be issued initially in definitive, fully
registered form without interest coupons with the applicable legends set forth
in Exhibit A added to the forms of such Certificates (each, a “Restricted
Global Security”).
47
Section
3.02 Registration.
The
Trustee is hereby appointed, and the Trustee hereby accepts its appointment
as,
initial Certificate Registrar in respect of the Certificates and shall maintain
books for the registration and for the transfer of Certificates (the
“Certificate
Register”).
The
Trustee may appoint a bank or trust company to act as successor Certificate
Registrar. A registration book shall be maintained for the Certificates
collectively. The Certificate Registrar may resign or be discharged or removed
and a new successor may be appointed in accordance with the procedures and
requirements set forth in Sections 6.06 and 6.07 hereof with respect to the
resignation, discharge or removal of the Trustee and the appointment of a
successor Trustee. The Certificate Registrar may appoint, by a written
instrument delivered to the Holders, any bank or trust company to act as
co-registrar under such conditions as the Certificate Registrar may prescribe;
provided,
however,
that
the Certificate Registrar shall not be relieved of any of its duties or
responsibilities hereunder by reason of such appointment.
Section
3.03 Transfer
and Exchange of Certificates.
(a) A
Certificate (other than Book-Entry Certificates which shall be subject to
Section 3.09 hereof) may be transferred by the Holder thereof only upon
presentation and surrender of such Certificate at the office of the Certificate
Registrar duly endorsed or accompanied by an assignment duly executed by such
Holder or his duly authorized attorney in such form as shall be satisfactory
to
the Certificate Registrar. Upon the transfer of any Certificate in accordance
with the preceding sentence, the Trustee shall execute, and the Authenticating
Agent shall authenticate and deliver to the transferee, one or more new
Certificates of the same Class and evidencing, in the aggregate, the same
aggregate Certificate Balance as the Certificate being transferred. No service
charge shall be made to a Certificateholder for any registration of transfer
of
Certificates, but the Certificate Registrar may require payment of a sum
sufficient to cover any tax or governmental charge that may be imposed in
connection with any registration of transfer of Certificates.
(b) A
Certificate may be exchanged by the Holder thereof for any number of new
Certificates of the same Class, in authorized denominations, representing in
the
aggregate the same Certificate Balance as the Certificate surrendered, upon
surrender of the Certificate to be exchanged at the office of the Certificate
Registrar duly endorsed or accompanied by a written instrument of transfer
duly
executed by such Holder or his duly authorized attorney in such form as is
satisfactory to the Certificate Registrar. Certificates delivered upon any
such
exchange will evidence the same obligations, and will be entitled to the same
rights and privileges, as the Certificates surrendered. No service charge shall
be made to a Certificateholder for any exchange of Certificates, but the
Certificate Registrar may require payment of a sum sufficient to cover any
tax
or governmental charge that may be imposed in connection with any exchange
of
Certificates. Whenever any Certificates are so surrendered for exchange, the
Trustee shall execute, and the Authenticating Agent shall authenticate, date
and
deliver the Certificates which the Certificateholder making the exchange is
entitled to receive.
(c) By
acceptance of a Restricted Certificate, whether upon original issuance or
subsequent transfer, each Holder of such a Certificate acknowledges the
restrictions on the transfer of such Certificate set forth thereon and agrees
that it will transfer such a Certificate only as provided herein.
48
The
following restrictions shall apply with respect to the transfer and registration
of transfer of a Restricted Certificate to a transferee that takes delivery
in
the form of a Definitive Certificate:
(i) The
Certificate Registrar shall register the transfer of a Restricted Certificate
if
the requested transfer is (x) to the Depositor or an affiliate (as defined
in Rule 405 under the 0000 Xxx) of the Depositor or (y) being made to
a “qualified institutional buyer” (a “QIB”)
as
defined in Rule 144A under the Securities Act by a transferor that has
provided the Certificate Registrar with a certificate in the form of
Exhibit H hereto; and
(ii) The
Certificate Registrar shall register the transfer of a Restricted Certificate
if
the requested transfer is being made to an “accredited investor” under
Rule 501(a)(1), (2), (3) or (7) under the Securities Act, or to any Person
all of the equity owners in which are such accredited investors, by a transferor
who furnishes to the Certificate Registrar a letter of the transferee
substantially in the form of Exhibit I hereto.
(d) No
transfer of an ERISA-Restricted Certificate in the form of a Definitive
Certificate shall be made to any Person or shall be effective unless the
Certificate Registrar, on behalf of the Trustee, has received (A) a
certificate substantially in the form of Exhibit J hereto (or
Exhibit B, in the case of a Residual Certificate) from such transferee or
(B) an Opinion of Counsel satisfactory to the Certificate Registrar and the
Trustee to the effect that the purchase and holding of such a Certificate will
not constitute or result in any nonexempt prohibited transactions under
Title I of ERISA or Section 4975 of the Code and will not subject the
Certificate Registrar, the Trustee or the Depositor to any obligation in
addition to those undertaken in the Agreement; provided,
however,
that
the Certificate Registrar will not require such certificate or opinion in the
event that, as a result of a change of law or otherwise, counsel satisfactory
to
the Certificate Registrar has rendered an opinion to the effect that the
purchase and holding of an ERISA-Restricted Certificate by a Plan or a Person
that is purchasing or holding such a Certificate with the assets of a Plan
will
not constitute or result in a prohibited transaction under Title I of ERISA
or Section 4975 of the Code and will not subject the Certificate Registrar,
the Trustee or the Depositor to any obligation in addition to those undertaken
in this Agreement. Each Transferee of an ERISA-Restricted Certificate that
is a
Book-Entry Certificate shall be deemed to have made the appropriate
representation set forth in paragraph 2 and the representation set forth in
paragraph 3 of Exhibit J. The preparation and delivery of the certificate
and opinions referred to above shall not be an expense of the Trust Fund, the
Certificate Registrar, the Trustee or the Depositor.
Notwithstanding
the foregoing, no opinion or certificate shall be required for the initial
issuance of the ERISA-Restricted Certificates to the Underwriter. The
Certificate Registrar shall have no obligation to monitor transfers of
Book-Entry Certificates that are ERISA-Restricted Certificates and shall have
no
liability for transfers of such Certificates in violation of the transfer
restrictions. The Certificate Registrar shall be under no liability to any
Person for any registration of transfer of any ERISA-Restricted Certificate
that
is in fact not permitted by this Section 3.03(d) and neither the Trustee
nor the Paying Agent shall have any liability 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 by the Certificate Registrar in accordance with the foregoing
requirements. The Trustee shall be entitled, but not obligated, to recover
from
any Holder of any ERISA-Restricted Certificate that was in fact a Plan or a
Person acting on behalf of a Plan any payments made on such ERISA-Restricted
Certificate at and after such time. Any such payments so recovered by the
Trustee shall be paid and delivered by the Trustee to the last preceding Holder
of such Certificate that is not such a Plan or Person acting on behalf of a
Plan.
49
(e) As
a
condition of the registration of transfer or exchange of any Certificate, the
Certificate Registrar may require the certified taxpayer identification number
of the owner of the Certificate and the payment of a sum sufficient to cover
any
tax or other governmental charge imposed in connection therewith; provided,
however,
that
the Certificate Registrar shall have no obligation to require such payment
or to
determine whether or not any such tax or charge may be applicable. No service
charge shall be made to the Certificateholder for any registration, transfer
or
exchange of a Certificate.
(f) Notwithstanding
anything to the contrary contained herein, no Residual Certificate may be owned,
pledged or transferred, directly or indirectly, by or to (i) a Disqualified
Organization or (ii) an individual, corporation or partnership or other
person unless such person (A) is not a Non-U.S. Person or (B) is a Non-U.S.
Person that holds a Residual Certificate in connection with the conduct of
a
trade or business within the United States and has furnished the transferor
and
the Certificate Registrar with an effective Internal Revenue Service
Form W-8ECI or successor form at the time and in the manner required by the
Code (any such person who is not covered by clause (A) or (B) above is
referred to herein as a “Non-permitted
Foreign Holder”).
Prior
to
and as a condition of the registration of any transfer, sale or other
disposition of a Residual Certificate, the proposed transferee shall deliver
to
the Certificate Registrar an affidavit in substantially the form attached hereto
as Exhibit B representing and warranting, among other things, that such
transferee is neither a Disqualified Organization, an agent or nominee acting
on
behalf of a Disqualified Organization, nor a Non-permitted Foreign Holder (any
such transferee, a “Permitted
Transferee”),
and
the proposed transferor shall deliver to the Trustee and the Certificate
Registrar an affidavit in substantially the form attached hereto as
Exhibit C. In addition, the Trustee or the Certificate Registrar may (but
shall have no obligation to) require, prior to and as a condition of any such
transfer, the delivery by the proposed transferee of an Opinion of Counsel,
addressed to the Trustee and the Certificate Registrar, that such proposed
transferee or, if the proposed transferee is an agent or nominee, the proposed
beneficial owner, is not a Disqualified Organization, agent or nominee thereof,
or a Non-permitted Foreign Holder. Notwithstanding the registration in the
Certificate Register of any transfer, sale, or other disposition of a Residual
Certificate to a Disqualified Organization, an agent or nominee thereof, or
Non-permitted Foreign Holder, such registration shall be deemed to be of no
legal force or effect whatsoever and such Disqualified Organization, agent
or
nominee thereof, or Non-permitted Foreign Holder shall not be deemed to be
a
Certificateholder for any purpose hereunder, including, but not limited to,
the
receipt of distributions on such Residual Certificate. The Depositor and the
Certificate Registrar shall be under no liability to any Person for any
registration or transfer of a Residual Certificate to a Disqualified
Organization, agent or nominee thereof or Non-permitted Foreign Holder or for
the Trustee or the Paying Agent making any payments due on such Residual
Certificate to the Holder thereof or for taking any other action with respect
to
such Holder under the provisions of the Agreement, so long as the transfer
was
effected in accordance with this Section 3.03(f), unless the Certificate
Registrar shall have actual knowledge at the time of such transfer or the time
of such payment or other action that the transferee is a Disqualified
Organization, or an agent or nominee thereof, or Non-permitted Foreign Holder.
The Certificate Registrar shall be entitled to recover from any Holder of a
Residual Certificate that was a Disqualified Organization, agent or nominee
thereof, or Non-permitted Foreign Holder at the time it became a Holder or
any
subsequent time it became a Disqualified Organization, agent or nominee thereof,
or Non-permitted Foreign Holder, all payments made on such Residual Certificate
at and after either such times (and all costs and expenses, including but not
limited to attorneys’ fees, incurred in connection therewith). Any payment (not
including any such costs and expenses) so recovered by the Certificate Registrar
shall be paid and delivered to the last preceding Holder of such Residual
Certificate.
50
If
any
purported transferee shall become a registered Holder of a Residual Certificate
in violation of the provisions of this Section 3.03(f), then upon receipt
of written notice to the Trustee or the Certificate Registrar that the
registration of transfer of such Residual Certificate was not in fact permitted
by this Section 3.03(f), the last preceding Permitted Transferee shall be
restored to all rights as Holder thereof retroactive to the date of such
registration of transfer of such Residual Certificate. The Depositor, the
Certificate Registrar and the Trustee shall be under no liability to any Person
for any registration of transfer of a Residual Certificate that is in fact
not
permitted by this Section 3.03(f), or for the Trustee or the Paying Agent
making any payment due on such Certificate to the registered Holder thereof
or
for taking any other action with respect to such Holder under the provisions
of
this Agreement so long as the transfer was registered upon receipt of the
affidavit described in the preceding paragraph of this
Section 3.03(f).
(g) Each
Holder or Certificate Owner of a Restricted Certificate, ERISA-Restricted
Certificate or Residual Certificate, or an interest therein, by such Holder’s or
Owner’s acceptance thereof, shall be deemed for all purposes to have consented
to the provisions of this section.
Neither
the Certified Registrar nor the Trustee will have any responsibility for any
aspect of the records relating to or payments made on account of beneficial
ownership interests of the Book-Entry Certificates or for maintaining,
supervising or reviewing any records relating to such beneficial ownership
interests or transfers thereof.
Section
3.04 Cancellation
of Certificates.
Any
Certificate surrendered for registration of transfer or exchange shall be
cancelled and retained in accordance with normal retention policies with respect
to cancelled certificates maintained by the Certificate Registrar.
51
Section
3.05 Replacement
of Certificates.
If
(i) any Certificate is mutilated and is surrendered to the Trustee or the
Certificate Registrar or (ii) the Certificate Registrar receives evidence
to its satisfaction of the destruction, loss or theft of any Certificate, and
there is delivered to the Trustee and the Certificate Registrar such security
or
indemnity as may be required by them to save each of them harmless, then, in
the
absence of notice to the Depositor, the Trustee or the Certificate Registrar
that such destroyed, lost or stolen Certificate has been acquired by a protected
purchaser, the Trustee shall execute and the Authenticating Agent shall
authenticate and deliver, in exchange for or in lieu of any such mutilated,
destroyed, lost or stolen Certificate, a new Certificate of like tenor and
Certificate Balance. Upon the issuance of any new Certificate under this
Section 3.05, the Trustee, the Depositor or the Certificate Registrar 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 Trustee, the Depositor or the Certificate
Registrar) connected therewith. Any replacement Certificate issued pursuant
to
this Section 3.05 shall constitute complete and indefeasible evidence of
ownership in the applicable Trust Fund, as if originally issued, whether or
not
the lost, stolen or destroyed Certificate shall be found at any
time.
If
after
the delivery of such new Certificate, a protected purchaser of the original
Certificate in lieu of which such new Certificate was issued presents for
payment such original Certificate, the Depositor, the Certificate Registrar
and
the Trustee or any agent shall be entitled to recover such new Certificate
from
the Person to whom it was delivered or any Person taking therefrom, except
a
protected purchaser, and shall be entitled to recover upon the security or
indemnity provided therefor to the extent of any loss, damage, cost or expenses
incurred by the Depositor, the Certificate Registrar, the Trustee or any agent
in connection therewith.
Section
3.06 Persons
Deemed Owners.
Subject
to the provisions of Section 3.09 with respect to Book-Entry Certificates,
the Depositor, the Trustee, the Certificate Registrar, the Paying Agent and
any
agent of any of them shall treat the Person in whose name any Certificate is
registered upon the books of the Certificate Registrar as the owner of such
Certificate for the purpose of receiving distributions pursuant to
Sections 5.01 and 5.02 and for all other purposes whatsoever, and none of
the Depositor, the Trustee, the Certificate Registrar, the Paying Agent nor
any
agent of any of them shall be affected by notice to the contrary.
Section
3.07 Temporary
Certificates.
(a) Pending
the preparation of definitive Certificates, upon the order of the Depositor,
the
Trustee shall execute and the Authenticating Agent shall authenticate and
deliver temporary Certificates that are printed, lithographed, typewritten,
mimeographed or otherwise produced, in any authorized denomination,
substantially of the tenor of the definitive Certificates in lieu of which
they
are issued and with such variations as the authorized officers executing such
Certificates may determine, as evidenced by their execution of such
Certificates.
52
(b) If
temporary Certificates are issued, the Depositor will cause definitive
Certificates to be prepared without unreasonable delay. After the preparation
of
definitive Certificates, the temporary Certificates shall be exchangeable for
definitive Certificates upon surrender of the temporary Certificates at the
office or agency of the Certificate Registrar without charge to the Holder.
Upon
surrender for cancellation of any one or more temporary Certificates, the
Trustee shall execute and the Authenticating Agent shall authenticate and
deliver in exchange therefor a like aggregate Certificate Balance of definitive
Certificates of the same Class in the authorized denominations. Until so
exchanged, the temporary Certificates shall in all respects be entitled to
the
same benefits under this Agreement as definitive Certificates of the same
Class.
Section
3.08 Appointment
of Paying Agent.
The
Trustee may appoint a Paying Agent (which may be the Trustee) for the purpose
of
making distributions to the Certificateholders hereunder. The Trustee is hereby
appointed as the initial Paying Agent. The Trustee shall cause any Paying Agent,
other than the Trustee, to execute and deliver to the Trustee an instrument
in
which such Paying Agent shall agree with the Trustee that such Paying Agent
will
hold all sums held by it for the payment to the Certificateholders in an
Eligible Account (which shall be the Distribution Account) in trust for the
benefit of the Certificateholders entitled thereto until such sums shall be
paid
to the Certificateholders. All funds remitted by the Trustee to any such Paying
Agent for the purpose of making distributions shall be paid to the
Certificateholders on each Distribution Date and any amounts not so paid shall
be returned on such Distribution Date to the Trustee. If the Paying Agent is
not
the Trustee, the Trustee shall cause to be remitted to the Paying Agent on
or
before the Business Day prior to each Distribution Date, by wire transfer in
immediately available funds, the funds to be distributed on such Distribution
Date. Any Paying Agent shall be either a bank or trust company or otherwise
authorized under law to exercise corporate trust powers.
Section
3.09 Book-Entry
Certificates.
(a) Each
Class of Book-Entry Certificates, upon original issuance, shall be issued in
the
form of one or more typewritten Certificates representing the Book-Entry
Certificates. The Book-Entry Certificates shall initially be registered on
the
Certificate Register in the name of the nominee of the Clearing Agency, and
no
Certificate Owner will receive a definitive certificate representing such
Certificate Owner’s interest in the Book-Entry Certificates, except as provided
in Section 3.09(c). Unless Definitive Certificates have been issued to
Certificate Owners of Book-Entry Certificates pursuant to
Section 3.09(c):
(i) the
provisions of this Section 3.09 shall be in full force and
effect;
(ii) the
Certificate Registrar, the Paying Agent and the Trustee shall deal with the
Clearing Agency for all purposes (including the making of distributions on
the
Book-Entry Certificates) as the authorized representatives of the Certificate
Owners and the Clearing Agency shall be responsible for crediting the amount
of
such distributions to the accounts of such Persons entitled thereto, in
accordance with the Clearing Agency’s normal procedures;
53
(iii) to
the
extent that the provisions of this Section 3.09 conflict with any other
provisions of this Agreement, the provisions of this Section 3.09 shall
control; and
(iv) the
rights of Certificate Owners shall be exercised only through the Clearing Agency
and the Clearing Agency Participants and shall be limited to those established
by law and agreements between such Certificate Owners and the Clearing Agency
and/or the Clearing Agency Participants. Unless and until Definitive
Certificates are issued pursuant to Section 3.09(c), the initial Clearing
Agency will make book-entry transfers among the Clearing Agency Participants
and
receive and transmit distributions of principal of and interest on the
Book-Entry Certificates to such Clearing Agency Participants.
(b) Whenever
notice or other communication to the Certificateholders is required under this
Agreement, unless and until Definitive Certificates shall have been issued
to
Certificate Owners pursuant to Section 3.09(c), the Trustee shall give all
such notices and communications specified herein to be given to Holders of
the
Book-Entry Certificates to the Clearing Agency.
(c) If
(A) the Clearing Agency or the Depositor advises the Certificate Registrar
in writing that the Clearing Agency is no longer willing or able to discharge
properly its responsibilities with respect to the Book-Entry Certificates,
and
(B) the Depositor is unable to locate a qualified successor satisfactory to
the Depositor and the Certificate Registrar, the Certificate Registrar shall
notify the Clearing Agency to effect notification to all Certificate Owners,
through the Clearing Agency, of the occurrence of any such event and of the
availability of Definitive Certificates to Certificate Owners requesting the
same. Upon surrender to the Certificate Registrar of the Book-Entry Certificates
by the Clearing Agency, accompanied by registration instructions from the
Clearing Agency for registration, the Certificate Registrar shall issue the
Definitive Certificates. Neither the Depositor, the Certificate Registrar nor
the Trustee shall be liable for any delay in delivery of such instructions
and
may conclusively rely on, and shall be protected in relying on, such
instructions. Upon the issuance of Definitive Certificates all references herein
to obligations imposed upon or to be performed by the Clearing Agency shall
be
deemed to be imposed upon and performed by the Certificate Registrar, to the
extent applicable, with respect to such Definitive Certificates and the
Certificate Registrar shall recognize the holders of the Definitive Certificates
as Certificateholders hereunder. Notwithstanding the foregoing, the Certificate
Registrar, upon the instruction of the Depositor, shall have the right to issue
Definitive Certificates on the Closing Date in connection with credit
enhancement programs.
ARTICLE
IV
ADMINISTRATION
OF THE TRUST FUND
Section
4.01 Custodial
Accounts; Distribution Account.
(a) On
each
Distribution Account Deposit Date, the Servicer shall remit to the Trustee
for
deposit into the Distribution Account, all amounts so required to be deposited
into such account in accordance with the terms of the Servicing
Agreements.
54
(b) The
Trustee, shall establish and maintain an Eligible Account entitled “Distribution
Account of LaSalle Bank National Association, as Trustee for the benefit of
Xxxxxx Xxxxxxx Mortgage Loan Trust 2006-14SL, Holders of Mortgage Pass-Through
Certificates.” The Trustee shall, promptly upon receipt from the Servicer on
each related Distribution Account Deposit Date, deposit into the Distribution
Account and retain on deposit until the related Distribution Date the following
amounts:
(i) the
aggregate of collections with respect to the Mortgage Loans remitted by the
Servicer from the Custodial Accounts in accordance with the Servicing Agreement;
and
(ii) any
other
amounts so required to be deposited in the Distribution Account in the related
Due Period pursuant to this Agreement.
(c) In
the
event the Servicer has remitted in error to the Distribution Account any amount
not required to be remitted in accordance with the definition of Available
Funds, it may at any time direct the Trustee to withdraw such amount from the
Distribution Account for repayment to the Servicer by delivery of an Officer’s
Certificate to the Trustee which describes the amount deposited in
error.
(d) On
each
Distribution Date and Initial Optional Purchase Date, the Trustee, as Paying
Agent, shall withdraw from funds available in the Distribution Account and
distribute the Available Funds to the Certificateholders and any other parties
entitled thereto in the amounts and priorities set forth in Section 5.02.
The Trustee may from time to time withdraw from the Distribution Account and
pay
itself, the related Custodian or the Servicer any amounts permitted to be paid
or reimbursed to such Person from funds in the Distribution Account pursuant
to
this Agreement, any Purchase Agreement, the Servicing Agreement or the related
Custodial Agreement.
(e) Funds
in
the Distribution Account may be invested in Permitted Investments selected
by
and at the written direction of the Trustee, which shall mature not later than
one Business Day prior to the Distribution Date (except that if such Permitted
Investment is an obligation of the Trustee or any of its Affiliates, or is
managed or advised by the Trustee or any Affiliate, then such Permitted
Investment shall mature not later than such applicable Distribution Date) and
any such Permitted Investment shall not be sold or disposed of prior to its
maturity. All such Permitted Investments shall be made in the name of the
Trustee (in its capacity as such) or its nominee. All income and gain realized
from any Permitted Investment of amounts on deposit in the Distribution Account
shall be for the benefit of the Trustee, as additional compensation for its
duties hereunder, and shall be subject to its withdrawal or order from time
to
time, and shall not be part of the Trust Fund; provided,
however,
that if
LaSalle Bank National Association is no longer the Trustee, any such income
and
gain shall be paid to the successor Trustee. The amount of any losses incurred
in respect of any such investments shall be deposited in such Distribution
Account by the Trustee out of its own funds, without any right of reimbursement
therefor, immediately as realized. At the Trustee’s discretion, funds in the
Distribution Account may remain uninvested.
Section
4.02 Permitted
Withdrawals from the Distribution Account.
55
The
Trustee shall withdraw funds from the Distribution Account for distributions
to
Certificateholders in the manner specified in this Agreement (and to withhold
from the amounts so withdrawn, the amount of any taxes that it is authorized
to
withhold pursuant to Section 9.01). In addition, the Trustee may from time
to
time make withdrawals from the Distribution Account for the following
purposes:
(i) to
pay
all amounts described in the sixth bullet of clause (1) of the definition of
“Available Distribution Amount”;
(ii) to
withdraw and retain the investment earnings on the Distribution Account as
its
compensation for the related Distribution Date;
(iii) to
withdraw and return to the Servicer any amount deposited in the Distribution
Account and not required to be deposited therein; and
(iv) to
clear
and terminate the Distribution Account upon termination of the Agreement
pursuant to Section 7.01.
Section
4.03 Enforcement
of Servicer’s Obligations.
(a) Upon
the
occurrence of a default under the Servicing Agreement of which a Responsible
Officer of the Trustee has actual knowledge, the Trustee, so long as any such
default shall be continuing, may, and shall if it determines such action to
be
in the best interests of Certificateholders, (i) terminate all of the
rights and powers of the Servicer pursuant to the applicable provisions of
the
Servicing Agreement; (ii) exercise any rights it may have to enforce the
Servicing Agreement against the Servicer; and/or (iii) waive any such
default under the Servicing Agreement or take any other action with respect
to
such default as is permitted thereunder; provided,
however,
that
the Trustee shall not waive any default by the Servicer in making any P&I
Advance required to be made by the Servicer under the Servicing Agreement.
(b) Any
termination by the Trustee of the Servicer’s rights and powers pursuant to the
Servicing Agreement shall not be effected unless or until the Trustee shall
have
assumed all of the rights and obligations of the Servicer under the Servicing
Agreement or shall have appointed, with the consent of the Rating Agencies
and
in accordance with the applicable provisions of the Servicing Agreement, a
new
Xxxxxx Xxx- or FHLMC-approved Person to serve as successor to the Servicer
and
such successor to the Servicer has accepted such appointment; provided,
however,
that it
is understood and agreed by the parties hereto that there will be a period
of
transition (not to exceed 90 days) before the actual servicing functions can
be
fully transferred to a successor servicer. Upon appointment of a successor
servicer, as authorized under this Section 4.03(b), unless the successive
servicer shall have assumed the obligations of the terminated Servicer under
the
Servicing Agreement, the Trustee and such successor servicer shall enter into
a
servicing agreement in a form substantially similar to the affected Servicing
Agreement. In connection with any such appointment, the Trustee may make such
arrangements for the compensation of such successor servicer as it and such
successor servicer shall agree, but in no event shall such compensation of
any
successor servicer be in excess of that payable to the Servicer under the
Servicing Agreement. If the Trustee assumes the servicing of the Mortgage Loans,
it will not assume liability for the representations or warranties of the
Servicer it replaces or for the actions, errors or omissions of such
Servicer.
56
(c) Upon
any
termination of the Servicer’s rights and powers pursuant to the Servicing
Agreement, the Trustee shall promptly notify each Rating Agency and the
Depositor, specifying in such notice that the successor servicer has succeeded
the Servicer under the Servicing Agreement (or under any other servicing
agreement reasonably satisfactory to the Trustee and the Rating Agencies),
which
notice shall also specify the name and address of any such successor
servicer.
(d) The
Depositor shall not consent to the assignment by the Servicer of the Servicer’s
rights and obligations under the Servicing Agreement without the prior written
consent of the Trustee, which consent shall not be unreasonably
withheld.
(e) The
Trustee shall execute and deliver, at the written request of the Servicer,
and
furnish to the Servicer, at the expense of the requesting party, a power of
attorney in the standard form provided by the Trustee to take title to the
Mortgaged Properties after foreclosure in the name of and on behalf of the
Trustee and for the purposes described herein to the extent necessary or
desirable to enable the Servicer to perform its duties. The Trustee shall not
be
liable for the actions of the Servicer under such powers of attorney or under
its Servicing Agreement.
Section
4.04 Reports
to Certificateholders.
On
each
Distribution Date, the Trustee shall have prepared and shall make available
to
the Depositor, the Rating Agencies and each Certificateholder a written report
setting forth the following information (on the basis of Mortgage Loan level
information obtained from the Servicer pursuant to the Servicing
Agreement):
(a) the
aggregate amount of the distribution to be made on such Distribution Date to
the
Holders of each Class of Certificates, allocable to principal on the Mortgage
Loans, including Liquidation Proceeds and Insurance Proceeds, stating separately
the amount attributable to scheduled principal payments and unscheduled payments
in the nature of principal;
(b) the
aggregate amount of the distribution to be made on such Distribution Date to
the
Holders of each Class of Certificates allocable to interest and the calculation
thereof;
(c) the
amount, if any, of any distributions to the Holders of the Class P, Class OC
and
Class R Certificates on such Distribution Date, stated separately, and the
aggregate amounts, if any, of distributions to the Holders of the Class P,
Class
OC and Class R Certificates on all Distribution Dates, stated
separately;
(d) the
aggregate amount of any P&I Advances required to be made by or on behalf of
the Servicer with respect to such Distribution Date;
57
(e) the
total
number of Mortgage Loans, the aggregate Stated Principal Balance of all the
Mortgage Loans as of the close of business on the last day of the related Due
Period, after giving effect to payments allocated to principal reported under
clause (a) above;
(f) the
Class
Principal Balance of each Class of Certificates, to the extent applicable,
as of
such Distribution Date after giving effect to payments allocated to principal
reported under clause (i) above, separately identifying any reduction of any
of
the foregoing Class Principal Balances due to Realized Losses;
(g) the
amount of any Prepayment Penalties distributed to the Class P
Certificates;
(h) the
amount of any Realized Losses incurred with respect to the Mortgage Loans (x)
in
the applicable Prepayment Period and (y) in the aggregate since the Cut-off
Date;
(i) the
amount of the Servicing Fees paid or retained by the Servicer during the Due
Period to which such distribution relates;
(j) the
number and aggregate Stated Principal Balance of Mortgage Loans, as reported
to
the Trustee by the Servicer, (a) remaining outstanding (b) Delinquent 30 to
59
days on a contractual basis, (c) Delinquent 60 to 89 days on a contractual
basis, (d) Delinquent 90 or more days on a contractual basis, (e) as to which
foreclosure proceedings have been commenced, each as of the close of business
on
the last Business Day of the calendar month immediately preceding the month
in
which such Distribution Date occurs, (f) in bankruptcy and (g) that are REO
Properties, (h) that are Charged-off Loans and (i) that are Released Mortgage
Loans;
(k) the
aggregate Stated Principal Balance of any Mortgage Loans with respect to which
the related Mortgaged Property became a REO Property, each as of the close
of
business on the last Business Day of the calendar month immediately preceding
the month in which such Distribution Date occurs;
(l) with
respect to substitution of Mortgage Loans in the preceding calendar month,
the
Stated Principal Balance of each Deleted Mortgage Loan, and of each Replacement
Mortgage Loan;
(m) the
aggregate outstanding Interest Carryforward Amount, Net Prepayment Interest
Shortfalls and Basis Risk Carryforward Amount, if any, for each applicable
Class
of Certificates, after giving effect to the distributions made on such
Distribution Date;
(n) the
Pass-Through Rate applicable to such Distribution Date with respect to each
Class of Certificates (with a notation if such Pass-Through Rate reflects the
application of the Net WAC Cap);
(o) the
Available Distribution Amount, the Interest Remittance Amount, the Principal
Distribution Amount applicable to such Distribution Date;
(p) if
applicable, the amount of any shortfall (i.e., the difference between the
aggregate amounts of principal and interest which Certificateholders would
have
received if there were sufficient available amounts in the Distribution Account
and the amounts actually distributed);
58
(q) the
Overcollateralized Amount after giving effect to the distributions made on
such
Distribution Date;
(r) the
amount of any Overcollateralization Increase Amount after giving effect to
the
distributions made on such Distribution Date; and
(s) the
level
of LIBOR for such Distribution Date and the level of LIBOR for the following
Distribution Date.
The
Trustee shall make such reports available each month via its website at
xxx.xxxxxxxx.xxx. Assistance in using the website may be obtained by calling
the
Trustee’s customer service desk at (000) 000-0000. Certificateholders and other
parties that are unable to use the website are entitled to have a paper copy
mailed to them via first class mail by contacting the Trustee and indicating
such. In preparing or furnishing the foregoing reports, the Trustee shall be
entitled to rely conclusively on the accuracy and completeness of the
information or data regarding the Mortgage Loans and the related REO Properties
that has been provided to the Trustee by the Servicer, without any independent
investigation, and the Trustee shall not be obligated to verify, recompute,
reconcile or recalculate any such information or data.
Upon
the
reasonable advance written request of any Certificateholder that is a savings
and loan, bank or insurance company, the Trustee shall provide, or cause to
be
provided, (or, to the extent that such information or documentation is not
required to be provided by the Servicer under the Servicing Agreement, shall
use
reasonable efforts to obtain such information and documentation from the
Servicer, and provide) to such Certificateholders such reports and access to
information and documentation regarding the Mortgage Loans as such
Certificateholders may reasonably deem necessary to comply with applicable
regulations of the Office of Thrift Supervision or its successor or other
regulatory authorities with respect to an investment in the Certificates;
provided,
however,
that
the Trustee shall be entitled to be reimbursed by such Certificateholders for
the Trustee’s actual expenses incurred in providing such reports and
access.
(b)
For
all purposes of this Agreement, with respect to any Mortgage Loan, delinquencies
shall be determined and reported based on the so-called “OTS” methodology for
determining delinquencies 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. The Servicer hereby represents and warrants
to the Depositor that this delinquency recognition policy is not less
restrictive than any delinquency recognition policy established by the primary
safety and soundness regulator, if any, of the Servicer.
59
Section
4.05 Annual
Statement of Compliance.
(a)
Not
later than March 15th of each calendar year commencing in 2007, the Trustee
and
the Custodian shall deliver, and the Trustee shall cause each Subcontractor
utilized by the Trustee and determined by the Trustee to be “participating in a
servicing function” within the meaning of Item 1122 of Regulation AB (in each
case, a “Servicing Function Participant”), to deliver, each at its own expense,
to the Depositor and the Trustee, a report on an assessment of compliance with
the Servicing Criteria applicable to it that contains (A) a statement by such
party of its responsibility for assessing compliance with the Servicing Criteria
applicable to it, (B) a statement that such party used the Servicing Criteria
to
assess compliance with the applicable Servicing Criteria, (C) such party’s
assessment of compliance with the applicable Servicing Criteria as of and for
the period ending the end of the fiscal year covered by the Form 10-K required
to be filed pursuant to Section 6.14 of the Trust Agreement, including, if
there
has been any material instance of noncompliance with the applicable 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 Person’s assessment of compliance with the applicable
Servicing Criteria as of and for such period. Each such assessment of compliance
report shall be addressed to the Depositor and signed by an authorized officer
of the applicable company, and shall address each of the applicable Servicing
Criteria set forth on Exhibit N hereto, or as set forth in the notification
furnished to the Depositor and the Trustee pursuant to Section 4.05(c). The
Trustee and the Custodian hereby acknowledge and agree that their respective
assessments of compliance will cover the items identified on Exhibit N hereto
are being covered by such party. 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 Trustee or the Custodian, as applicable,
Servicer as to the nature of any material instance of noncompliance with the
Servicing Criteria (and Servicing Function Participant engaged or utilized
by
the Trustee), as the case may be. None of the Trustee, the Custodian or
Servicing Function Participant shall be required to cause the delivery of any
such assessments if it has received written confirmation from the Depositor
that
a Form 10-K is not required to be filed in respect of the Trust for the
preceding calendar year.
(b)
Not
later than March 15th of each calendar year commencing in 2007, the Trustee
and
the Custodian shall cause, and the Trustee shall cause each Servicing Function
Participant utilized by the Trustee to cause, each at its own expense, a
registered public accounting firm (which may also render other services to
such
party) and that is a member of the American Institute of Certified Public
Accountants to furnish a report to the Trustee and the Depositor, with a copy
to
the Rating Agencies, to the effect that (i) it has obtained a representation
regarding certain matters from the management of such Person, which includes
an
assertion that such Person has complied with the Servicing Criteria applicable
to it and (ii) on the basis of an examination conducted by such firm in
accordance with standards for attestation engagements issued or adopted by
the
PCAOB, that attests to and reports on such Person’s assessment of compliance
with the Servicing Criteria applicable to it. 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. Each such related
accountant’s attestation report shall be made in accordance with Rules
1-02(a)(3) and 2-02(g) of Regulation S-X under the Securities Act and the
Exchange Act. Such report must be available for general use and not contain
restricted use language. Promptly after receipt of each such accountants’
attestation report, the Depositor shall review the report and, if applicable,
consult with the Trustee or the Custodian, as applicable, as to the nature
of
any defaults by the Trustee or the Custodian, as applicable, (and each Servicing
Function Participant engaged or utilized by the Trustee), as the case may be,
in
the fulfillment of any of the Trustee’s, the Custodian’s or the applicable
Servicing Function Participant’s obligations hereunder. None of the Trustee or
the Custodian or the Servicing Function Participant shall be required to cause
the delivery of any such attestation required by this paragraph in any year
in
which a Form 10-K is not required to be filed in respect of the Trust for the
preceding calendar year.
60
(c)
No
later than February 1 of each fiscal year, commencing in 2007, in which a Form
10-K will be required to be filed in respect of the Trust for the preceeding
calendar year, the Trustee shall notify the Depositor as to the name of each
Servicing Function Participant utilized by it, and each such notice will specify
what specific Servicing Criteria will be addressed in the report on assessment
of compliance prepared by such Servicing Function Participant in each case,
to
the extent of any change from the prior year’s notice, if any. When the Trustee
submits its assessment pursuant to Section 4.05(a), the Trustee will also at
such time include the assessment (and related attestation pursuant to Section
4.05(b)) of each Servicing Function Participant utilized by it.
Section
4.06 Regulation
AB Compliance, Intent of the Parties; Reasonableness.
The
parties hereto acknowledge that interpretations of the requirements of
Regulation AB may change over time, whether due to interpretive guidance
provided by the Commission or its staff, consensus among participants in the
asset-backed securities markets, advice of counsel, or otherwise, and agree
to
comply with requests made by the Depositor in good faith for delivery of
information under these provisions on the basis of evolving interpretations
of
Regulation AB. In connection with the Trust, the Trustee, at the expense of
the
Depositor, shall cooperate fully with the Depositor to deliver to the Depositor
(including its assignees or designees), any and all statements, reports,
certifications, records and any other information available to the Trustee
and
reasonably necessary in the good faith determination of the Depositor to permit
the Depositor to comply with the provisions of Regulation AB, together with
such
disclosures relating to the Trustee or Servicing Function Participant engaged
by
it, reasonably believed by the Depositor to be necessary in order to effect
such
compliance.
ARTICLE
V
DISTRIBUTIONS
TO HOLDERS OF CERTIFICATES
Section
5.01 Distributions
Generally.
(a) Subject
to Section 7.01 respecting the final distribution on the Certificates, on
each Distribution Date the Trustee or the Paying Agent shall make all
distributions in accordance with this Article V. Such distributions shall be
made by check mailed to each Certificateholder’s address as it appears on the
Certificate Register of the Certificate Registrar or, upon written request
made
to the Trustee at least five Business Days prior to the related Record Date
by
any Certificateholder owning an aggregate initial Certificate Balance of at
least $1,000,000, by wire transfer in immediately available funds to an account
specified in the request and at the expense of such Certificateholder;
provided,
however,
that
the final distribution in respect of any Certificate shall be made only upon
presentation and surrender of such Certificate at the Certificate Registrar’s
Corporate Trust Office; provided,
further,
that
the foregoing provisions shall not apply to any Class of Certificates as long
as
such Certificate remains a Book-Entry Certificate in which case all payments
made shall be made through the Clearing Agency and its Clearing Agency
Participants. Notwithstanding the reduction of the Class Principal Balance
of
any Class of Certificates to zero, such Class will be outstanding hereunder
(solely for the purpose of receiving distributions and not for any other
purpose) until the termination of the respective obligations and
responsibilities of the Depositor and the Trustee hereunder in accordance with
Article VII. Wire transfers will be made at the expense of the Holder requesting
such wire transfer by deducting a wire transfer fee from the related
distribution. Notwithstanding such final payment of principal of any of the
Certificates, each Residual Certificate will remain outstanding until the
termination of each REMIC and the payment in full of all other amounts due
with
respect to the Residual Certificates and at such time such final payment in
retirement of any Residual Certificate will be made only upon presentation
and
surrender of such Certificate at the Certificate Registrar’s Corporate Trust
Office. If any payment required to be made on the Certificates is to be made
on
a day that is not a Business Day, then such payment will be made on the next
succeeding Business Day.
61
(b) All
distributions or allocations made with respect to the Certificateholders within
each Class on each Distribution Date shall be allocated among the outstanding
Certificates in such Class equally in proportion to their respective initial
Class Principal Balances or Percentage Interests.
Section
5.02 Priorities
of Distribution.
On
each
Distribution Date, the Trustee shall withdraw from the Distribution Account
the
Available Distribution Amount (to the extent that such amount is then on deposit
in the Distribution Account) and shall distribute such amount in the following
order of priority:
(a) With
respect to the portion of Available Distribution Amount for such Distribution
Date consisting of the Interest Remittance Amount for such Distribution Date,
on
each Distribution Date, the Trustee shall withdraw the Interest Remittance
Amount from the Available Distribution Amount on deposit in the Distribution
Account for that Distribution Date, and apply such funds to distributions on
the
specified Class of Certificates that have outstanding Class Principal Balances,
sequentially, as follows: first,
(i) to
the Class A-1 Certificates, the Class A Interest Distribution Amount for such
Distribution Date and second,
(ii)
sequentially, to the Class X-0, Xxxxx X-0, Class M-3, Class M-4, Class B-1,
Class B-2, Class B-3, Class B-4 and Class B-5 Certificates, in that order,
their
respective Subordinated Interest Distribution Amounts, in each case, to the
extent of the Interest Remittance Amount remaining for such Class for such
Distribution Date;
(b)(i) On
each
Distribution Date (a) prior to the Stepdown Date or (b) on which a Trigger
Event
is in effect, the Holders of each of the Class A-1, Class M-1, Class M-2, Class
M-3, Class M-4, Class B-1, Class B-2, Class B-3, Class B-4 and Class B-5
Certificates shall be entitled to receive distributions in respect of principal
from the Principal Distribution Amount, first, to the holders of (x) the Class
A-1 Certificates in accordance, until their Class Principal Balance is reduced
to zero, and then, to the holders of (y) the Class X-0, Xxxxx X-0, Class M-3,
Class M-4, Class B-1, Class B-2, Class B-3, Class B-4 and Class B-5
Certificates, sequentially, in that order, until their respective Class
Principal Balances are reduced to zero.
62
(ii) On
each
Distribution Date (a) on or after the Stepdown Date and (b) on which a Trigger
Event is not in effect, the Holders of the Class A-1, Class M-1, Class M-2,
Class M-3, Class M-4, Class B-1, Class B-2, Class B-3, Class B-4 and Class
B-5
Certificates shall be entitled to receive distributions in respect of principal
from the Principal Distribution Amount in the following amounts and order of
priority:
|
(i)
|
to
the Class A-1 Certificates, the Class A Principal Distribution Amount,
until their Class Principal Balance is reduced to
zero;
|
|
(ii)
|
to
the Class M-1 Certificates, the Class M-1 Principal Distribution
Amount,
until their Class Principal Balance is reduced to
zero;
|
|
(iii)
|
to
the Class M-2 Certificates, the Class M-2 Principal Distribution
Amount,
until their Class Principal Balance is reduced to
zero;
|
|
(iv)
|
to
the Class M-3 Certificates, the Class M-3 Principal Distribution
Amount,
until their Class Principal Balance is reduced to
zero;
|
|
(v)
|
to
the Class M-4 Certificates, the Class M-4 Principal Distribution
Amount,
until their Class Principal Balance is reduced to
zero;
|
|
(vi)
|
to
the Class B-1 Certificates, the Class B-1 Principal Distribution
Amount,
until their Class Principal Balance is reduced to zero;
|
|
(vii)
|
to
the Class B-2 Certificates, the Class B-2 Principal Distribution
Amount,
until their Class Principal Balance is reduced to zero;
|
|
(viii)
|
to
the Class B-3 Certificates, the Class B-3 Principal Distribution
Amount,
until their Class Principal Balance is reduced to zero;
|
|
(ix)
|
to
the Class B-4 Certificates, the Class B-4 Principal Distribution
Amount,
until their Class Principal Balance is reduced to zero;
|
|
(x)
|
to
the Class B-5 Certificates, the Class B-5 Principal Distribution
Amount,
until their Class Principal Balance is reduced to zero;
and
|
(c) On
each
Distribution Date the sum of (i) the Overcollateralization Release Amount and
(ii) Net Monthly Excess Cashflow, each for such Distribution Date, shall be
distributed in the following order of priority, in each case to the extent
of
the amounts remaining:
63
(i) the
Extra
Principal Distribution Amount will be distributed (a) prior to the Stepdown
Date
or if a Trigger Event is in effect, sequentially, first,
to the
holders of (x) the Class A-1 Certificates, until their Class Principal Balance
is reduced to zero, and second,
to the
holders of (y) the Class X-0, Xxxxx X-0, Class M-3, Class M-4, Class B-1, Class
B-2, Class B-3, Class B-4 and Class B-5 Certificates, sequentially, in that
order, until their respective Class Principal Balances are reduced to zero
and
(b) on and after the Stepdown Date and if a Trigger Event is not in effect,
sequentially, first,
to the
holders of (x) the Class A-1 Certificates, the amount calculated pursuant to
the
second bullet point of Class A Principal Distribution Amount, and second,
to the
holders of (y) the Class X-0, Xxxxx X-0, Class M-3, Class M-4, Class B-1, Class
B-2, Class B-3, Class B-4 and Class B-5 Certificates, sequentially, in that
order, the amount calculated pursuant to the second bullet point of Class M-1
Principal Distribution Amount, Class M-2 Principal Distribution Amount, Class
M-3 Principal Distribution Amount, Class M-4 Principal Distribution Amount,
Class B-1 Principal Distribution Amount, Class B-2 Principal Distribution
Amount, Class B-3 Principal Distribution Amount, Class B-4 Principal
Distribution Amount and Class B-5 Principal Distribution Amount, respectively,
in each case after application of the distributions to such Certificates on
that
Distribution Date pursuant to clause (b)(i) above, until their respective Class
Principal Balances are reduced to zero;
(ii) to
the
Class M-1 Certificates, the related Interest Carry Forward Amount;
(iii) to
the
Class M-1 Certificates, the related Unpaid Realized Loss Amount;
(iv) to
the
Class M-2 Certificates, the related Interest Carry Forward Amount;
(v) to
the
Class M-2 Certificates, the related Unpaid Realized Loss Amount;
(vi) to
the
Class M-3 Certificates, the related Interest Carry Forward Amount;
(vii) to
the
Class M-3 Certificates, the related Unpaid Realized Loss Amount;
(viii) to
the
Class M-4 Certificates, the related Interest Carry Forward Amount;
(ix) to
the
Class M-4 Certificates, the related Unpaid Realized Loss Amount;
(x) to
the
Class B-1 Certificates, the related Interest Carry Forward Amount;
(xi) to
the
Class B-1 Certificates, the related Unpaid Realized Loss Amount;
(xii) to
the
Class B-2 Certificates, the related Interest Carry Forward Amount;
(xiii) to
the
Class B-2 Certificates, the related Unpaid Realized Loss Amount;
(xiv) to
the
Class B-3 Certificates, the related Interest Carry Forward Amount;
(xv) to
the
Class B-3 Certificates, the related Unpaid Realized Loss Amount;
64
(xvi) to
the
Class B-4 Certificates, the related Interest Carry Forward Amount;
(xvii) to
the
Class B-4 Certificates, the related Unpaid Realized Loss Amount;
(xviii) to
the
Class B-5 Certificates, the related Interest Carry Forward Amount;
(xix) to
the
Class B-5 Certificates, the related Unpaid Realized Loss Amount;
(xx) to
the
Class A-1 Certificates, any unpaid remaining Basis Risk Carry Forward Amount
for
such Class;
(xxi) sequentially,
to the Class X-0, Xxxxx X-0, Class M-3, Class M-4, Class B-1, Class B-2 and
Class B-3 Certificates, in that order,
any
unpaid remaining Basis Risk Carry Forward Amount for each such
Class;
(xxii) to
the
Class OC Certificates, the Class OC Distributable Amount; and
(xxiii) to
the
holders of the Class R Certificates, any remaining amounts.
For
the
avoidance of doubt, Section 5.02(c) is intended to cause the Class OC
Certificates to receive from amounts remaining after the application of all
other clauses of Section 5.02(c) preceding it, an amount up to the sum of the
Class OC Distributable Amount for that Distribution Date and any Class OC
Distributable Amounts remaining unpaid from prior Distribution Dates and the
Trustee shall construe Section 5.02(c) as necessary so as to accomplish such
result.
(d) On
each
Distribution Date, the Class P Distribution Amount received during the related
Prepayment Period will be distributed to the holders of the Class P
Certificates. On the Distribution Date in November 2011, the $100 held in trust
for the Class P Certificates will be distributed to the holders of the Class
P
Certificates.
Section
5.03 Allocation
of Losses.
(a) On
or
prior to each Distribution Date, the Trustee shall aggregate the information
provided by the Servicer with respect to the total amount of Realized Losses
for
the related Distribution Date.
(b) Any
Applied Loss Amounts on the Mortgage Loans shall be allocated to the
Subordinated Certificates in reverse order of their respective priorities of
payment (beginning with the Class of Class B Certificates then outstanding
with
the highest numerical Class designation or, if no Classes of Class B
Certificates are outstanding, then beginning with the Class of Class M
Certificates then outstanding with the highest numerical Class designation)
until the respective Class Principal Balance of each such Class is reduced
to
zero.
(c) The
Class
Principal Balance of the Class of Subordinated Certificates then outstanding
with the highest numerical Class designation shall be reduced on each
Distribution Date by the Applied Loss Amount, if any. For the avoidance of
doubt, no reductions will be made in the Class Principal Balance of the Senior
Certificates in respect of Realized Losses on the Mortgage Loans.
65
(d) Any
Applied Loss Amounts allocated to a Class of Certificates or any reduction
in
the Class Principal Balance of a Class of Certificates pursuant to Section
5.03(b) above shall be allocated among the Certificates of such Class in
proportion to their respective Certificate Balances.
(e) Any
allocation of Realized Losses to a Certificate or any reduction in the
Certificate Balance of a Certificate, pursuant to Section 5.03(b) above shall
be
accomplished by reducing the Certificate Balance thereof immediately following
the distributions made on the related Distribution Date in accordance with
the
definition of “Certificate Balance.”
(f) For
the
avoidance of doubt, no Realized Losses on the Mortgage Loans shall be allocated
to the Class P Certificates.
(g) In
the
event of any Subsequent Recoveries, (i) such amount shall be treated as a
Principal Prepayment and shall be included in the Available Distribution Amount
for the Distribution Date occurring in the month following the month in which
such recovery is received and (ii) the Certificate Balance of the Class or
Classes to which the related Realized Loss had previously been allocated,
whether or not such Class or Classes remain outstanding, shall be increased
in
direct order of priority, in each case by an amount equal to the lesser of
(x)
the amount of such recovery and (y) the aggregate amount of Realized Losses
previously allocated to such Classes less amounts previously allocated to such
Classes pursuant to this paragraph.
Section
5.04 Determination
of Pass-Through Rates for LIBOR Certificates.
(a) On
each
Interest Determination Date after the initial Interest Determination Date and
for so long as any LIBOR Certificates are outstanding, the Trustee will
determine LIBOR on the basis of the British Bankers’ Association (“BBA”)
“Interest Settlement Rate” for one-month deposits in U.S. dollars as found on
Telerate Page 3750 as of 11:00 a.m. London time on each Interest Determination
Date.
(b) If
on any
Interest Determination Date, LIBOR cannot be determined as provided in paragraph
(a) of this Section 5.05, the Trustee shall either (i) request each Reference
Bank to inform the Trustee of the quotation offered by its principal London
office for making one-month United States dollar deposits in leading banks
in
the London interbank market, as of 11:00 a.m. (London time) on such Interest
Determination Date or (ii) in lieu of making any such request, rely on such
Reference Bank quotations that appear at such time on the Reuters Screen LIBO
Page (as defined in the International Swap Dealers Association Inc. Code of
Standard Wording, Assumptions and Provisions for Swaps, 1986 Edition), to the
extent available. LIBOR for the next Interest Accrual Period will be established
by the Trustee on each interest Determination Date as follows:
(i) If
on any
Interest Determination Date two or more Reference Banks provide such offered
quotations, LIBOR for the next applicable Interest Accrual Period shall be
the
arithmetic mean of such offered quotations (rounding such arithmetic mean
upwards if necessary to the nearest whole multiple of 1/32%).
66
(ii) If
on any
Interest Determination Date only one or none of the Reference Banks provides
such offered quotations, LIBOR for the next Interest Accrual Period shall be
whichever is the higher of (i) LIBOR as determined on the previous Interest
Determination Date or (ii) the Reserve Interest Rate. The “Reserve
Interest Rate”
shall
be the rate per annum which the Trustee determines to be either (i) the
arithmetic mean (rounded upwards if necessary to the nearest whole multiple
of
1/32%) of the one-month United States dollar lending rates that New York City
banks selected by the Trustee are quoting, on the relevant Interest
Determination Date, to the principal London offices of at least two of the
Reference Banks to which such quotations are, in the opinion of the Trustee,
being so made, or (ii) in the event that the Trustee can determine no such
arithmetic mean, the lowest one-month United States dollar lending rate which
New York City banks selected by the Trustee are quoting on such Interest
Determination Date to leading European banks.
(iii) If
on any
Interest Determination Date the Trustee is required but is unable to determine
the Reserve Interest Rate in the manner provided in paragraph (b) above, LIBOR
for the related Classes of Certificates shall be LIBOR as determined on the
preceding applicable Interest Determination Date.
(iv) In
the
case of the first Distribution Date, LIBOR shall be 5.3391%.
Until
all
of the LIBOR Certificates are paid in full, the Trustee will at all times retain
at least four Reference Banks for the purpose of determining LIBOR with respect
to each Interest Determination Date. The Trustee initially shall designate
the
Reference Banks. 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 Trustee 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 Trustee should terminate its appointment as Reference
Bank, the Trustee shall promptly appoint or cause to be appointed another
Reference Bank. The Trustee 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.
(c) The
Pass-Through Rate for each Class of LIBOR Certificates for each Interest Accrual
Period shall be determined by the Trustee on each Interest 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.
(d) In
determining LIBOR, any Pass-Through Rate for the LIBOR Certificates, any
Interest Settlement Rate, or any Reserve Interest Rate, the Trustee may
conclusively rely and shall be protected in relying upon the offered quotations
(whether written, oral or on the Dow Xxxxx Markets) from the BBA designated
banks, the Reference Banks or the New York City banks as to LIBOR, the Interest
Settlement Rate or the Reserve Interest Rate, as appropriate, in effect from
time to time. The Trustee shall not have any liability or responsibility to
any
Person for (i) the selection of New York City banks for purposes of determining
any Reserve Interest Rate or (ii) its inability, following a good-faith
reasonable effort, to obtain such quotations from, the BBA designated banks,
the
Reference Banks or the New York City banks or to determine such arithmetic
mean,
all as provided for in this Section 5.04.
67
(e) The
establishment of LIBOR and each Pass-Through Rate for the LIBOR Certificates
by
the Trustee shall (in the absence of manifest error) be final, conclusive and
binding upon each Holder of a Certificate and the Trustee.
68
ARTICLE
VI
CONCERNING
THE TRUSTEE; EVENTS OF DEFAULT
Section
6.01 Duties
of
Trustee.
(a) The
Trustee undertakes to perform such duties and only such duties as are
specifically set forth in this Agreement. Any permissive right of the Trustee
provided for in this Agreement shall not be construed as a duty of the
Trustee.
(b) The
Trustee, upon receipt of all resolutions, certificates, statements, opinions,
reports, documents, orders or other instruments furnished to the Trustee which
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 Trustee shall not be responsible for the accuracy or content of any such
resolution, certificate, statement, opinion, report, document, order or other
instrument furnished by the Servicer to the Trustee pursuant to this Agreement,
and shall not be required to recalculate or verify any numerical information
furnished to the Trustee pursuant to this Agreement. Subject to the immediately
preceding sentence, if any such resolution, certificate, statement, opinion,
report, document, order or other instrument is found not to conform to the
form
required by this Agreement in a material manner the Trustee shall take such
action as it deems appropriate to cause the instrument to be corrected, and
if
the instrument is not corrected to the Trustee’s satisfaction, the Trustee will
provide notice thereof to the Certificateholders and will, at the expense of
the
Trust Fund, which expense shall be reasonable given the scope and nature of
the
required action, take such further action as directed by the
Certificateholders.
(i) The
Trustee shall not have any liability arising out of or in connection with this
Agreement, except for its negligence or willful misconduct. 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; provided,
however,
that:
(ii) No
provision of this Agreement shall require the Trustee to expend or risk its
own
funds or otherwise incur any financial liability in the performance of any
of
its duties hereunder, or in the exercise of any of its rights or powers, if
it
shall have reasonable grounds for believing that repayment of such funds or
indemnity reasonably satisfactory to it against such risk or liability is not
reasonably assured to it; and
(iii) The
Trustee shall not be responsible for any act or omission of the Depositor,
the
Seller, the Servicer or any Custodian (unless the Trustee and the Custodian
are
the same Person).
(c) The
Trustee shall have no duty hereunder with respect to any complaint, claim,
demand, notice or other document it may receive or which may be alleged to
have
been delivered to or served upon it by the parties as a consequence of the
assignment of any Mortgage Loan hereunder.
69
(d) The
Trustee shall not be personally 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 Certificateholders of any Class holding Certificates which
evidence, as to such Class, Percentage Interests aggregating not less than
25%
as 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 or the Acknowledgements.
(e) The
Trustee shall not be required to perform services under this Agreement, or
to
expend or risk its own funds or otherwise incur financial liability for the
performance of any of its duties hereunder or the exercise of any of its rights
or powers if there is reasonable ground for believing that the timely payment
of
its fees and expenses or the repayment of such funds or indemnity reasonably
satisfactory to it against such risk or liability is not reasonably assured
to
it, and none of the provisions contained in this Agreement shall in any event
require the Trustee to perform, or be responsible for the manner of performance
of, any of the obligations of the Servicer under this Agreement or the Servicing
Agreement.
(f) The
Trustee shall not be held liable by reason of any insufficiency in the
Distribution Account resulting from any investment loss on any Permitted
Investment included therein (except to the extent that the Trustee is the
obligor and has defaulted thereon).
(g) The
Trustee shall not have any duty (A) to see to 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 of any thereof, (B) to see to any
insurance, (C) to see to the payment or discharge of 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, or (D) to confirm or
verify the contents of any reports or certificates of the Servicer delivered
to
the Trustee pursuant to this Agreement believed by the Trustee to be genuine
and
to have been signed or presented by the proper party or parties.
(h) The
Trustee shall not be liable in its individual capacity for an error of judgment
made in good faith by a Responsible Officer or other officers of the Trustee
unless it shall be proved that the Trustee was negligent in ascertaining the
pertinent facts.
(i) Notwithstanding
anything in this Agreement to the contrary, the Trustee shall not be liable
for
special, indirect or consequential losses or damages of any kind whatsoever
(including, but not limited to, lost profits), even if the Trustee has been
advised of the likelihood of such loss or damage and regardless of the form
of
action.
For
all
purposes under this Agreement, the Trustee shall not be deemed to have any
notice of any event of default under a Servicing Agreement unless a Responsible
Officer of the Trustee has actual knowledge thereof or unless written notice
of
any event which is in fact such a default is received by the Trustee at the
Corporate Trust Office of the Trustee, and such notice references the Holders
of
the Certificates and this Agreement.
70
Section
6.02 Certain
Matters Affecting the Trustee.
Except
as
otherwise provided in Section 6.01:
(i) The
Trustee may request, and may rely 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, approval, bond or other paper or document believed
by
it to be genuine and to have been signed or presented by the proper party or
parties;
(ii) The
Trustee may consult with counsel and any advice of its counsel 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
Trustee shall not be personally liable for any action taken, suffered or omitted
by it in good faith and reasonably believed by it to be authorized or within
the
discretion or rights or powers conferred upon it by this Agreement;
(iv) 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 at least a majority
in
Class Principal Balance or Percentage Interest of each Class of Certificates;
provided,
however,
that,
if the payment within a reasonable time to the Trustee of the costs, expenses
or
liabilities likely to be incurred by it in the making of such investigation
is,
in the opinion of the Trustee not reasonably assured to the Trustee by the
security afforded to it by the terms of this Agreement, the Trustee o may
require indemnity reasonably satisfactory to it against such expense or
liability or payment of such estimated expenses from the Certificateholders
as a
condition to proceeding. The reasonable expense thereof shall be paid by the
party requesting such investigation and if not reimbursed by the requesting
party shall be reimbursed to the Trustee by the Trust Fund;
(v) The
Trustee may execute any of the trusts or powers hereunder or perform any duties
hereunder either directly or by or through agents, custodians or attorneys,
which agents, custodians or attorneys shall have any and all of the rights,
powers, duties and obligations of the Trustee conferred on them by such
appointment, provided that the Trustee shall continue to be responsible for
its
duties and obligations hereunder to the extent provided herein, and provided
further that the Trustee shall not be responsible for any misconduct or
negligence on the part of any such agent or attorney appointed with due care
by
the Trustee;
(vi) The
Trustee shall not be under any obligation to exercise any of the trusts or
powers vested in it by this Agreement or the Acknowledgements or to institute,
conduct or defend any litigation hereunder or in relation hereto, in each case
at the request, order or direction of any of the Certificateholders pursuant
to
the provisions of this Agreement, unless such Certificateholders shall have
offered to the Trustee security or indemnity reasonably satisfactory to it
against the costs, expenses and liabilities which may be incurred therein or
thereby;
71
(vii) The
right
of the Trustee to perform any discretionary act enumerated in this Agreement
shall not be construed as a duty, and the Trustee shall not be answerable for
other than its negligence or willful misconduct in the performance of such
act;
(viii) The
Trustee shall not be required to give any bond or surety in respect of the
execution of the Trust Fund created hereby or the powers granted hereunder;
and
(ix) In
order
to comply with its duties under the U.S.A. Patriot Act, the Trustee shall obtain
and verify certain information and documentation from the other parties to
this
Agreement, including, but not limited to each such party’s name, address and
other identifying information.
Section
6.03 Trustee
Not Liable for Certificates.
The
Trustee makes no representations as to the validity or sufficiency of this
Agreement, any Purchase Agreement, the Servicing Agreement, the Custodial
Agreements or Acknowledgement or of the Certificates (other than the certificate
of authentication on the Certificates) or of any Mortgage Loan, or related
document save that the Trustee represents that, assuming due execution and
delivery by the other parties hereto, this Agreement has been duly authorized,
executed and delivered by it and constitutes its valid and binding obligation,
enforceable against it in accordance with its terms except that such
enforceability may be subject to (A) applicable bankruptcy and insolvency
laws and other similar laws affecting the enforcement of the rights of creditors
generally, and (B) general principles of equity regardless of whether such
enforcement is considered in a proceeding in equity or at law. The Trustee
shall
not be accountable for the use or application by the Depositor of funds paid
to
the Depositor in consideration of the assignment of the Mortgage Loans to the
Trust Fund by the Depositor or for the use or application of any funds deposited
into the Distribution Account or any other fund or account maintained with
respect to the Certificates. The Trustee shall not be responsible for the
legality or validity of this Agreement or any other document or agreement
described in this Section 6.03 or the validity, priority, perfection or
sufficiency of the security for the Certificates issued or intended to be issued
hereunder. The Trustee shall not have any responsibility for filing 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 or to record this Agreement.
Section
6.04 Trustee
May Own Certificates.
The
Trustee and any Affiliate or agent of it in its individual or any other capacity
may become the owner or pledgee of Certificates and may transact banking and
trust business with the other parties hereto and their Affiliates with the
same
rights it would have if it were not Trustee or such agent.
72
Section
6.05 Eligibility
Requirements for 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 6.05
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 the provisions of this Section 6.05, the Trustee
shall resign immediately in the manner and with the effect specified in Section
6.06 hereof. The entity serving as Trustee may have normal banking and trust
relationships with the Depositor, the Seller, the Servicer, each Custodian
and
their respective affiliates.
The
Trustee (i) may not be an Originator, Servicer, the Depositor or an affiliate
of
the Depositor, (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/A1" by S&P or the equivalent rating by Xxxxx'x (or such rating acceptable
to S&P and Xxxxx’x pursuant to a written confirmation). If at any time the
Trustee shall cease to be eligible in accordance with the provisions of this
Section 6.05, the Trustee shall resign in the manner and with the effect
specified in Section 6.06.
Section
6.06 Resignation
and Removal of Trustee.
(a) The
Trustee may at any time resign and be discharged from the trust hereby created
by giving written notice thereof to the Depositor. Upon receiving such notice
of
resignation, the Depositor will promptly appoint a successor trustee, by written
instrument, one copy of which instrument shall be delivered to the resigning
Trustee, one copy to the successor trustee and one copy to the Servicer. If
no
successor trustee shall have been so appointed and shall have accepted
appointment within 30 days after the giving of such notice of resignation,
the
resigning Trustee may petition any court of competent jurisdiction for the
appointment of a successor trustee.
(b) If
at any
time (i) the Trustee shall cease to be eligible in accordance with the
provisions of Section 6.05 and shall fail to resign after written request
therefor by the Depositor, (ii) the Trustee shall become incapable of
acting, or shall be adjudged a bankrupt or insolvent, or a receiver of the
Trustee of its property shall be appointed, or any public officer shall take
charge or control of the Trustee or of either of their property or affairs
for
the purpose of rehabilitation, conservation or liquidation, (iii) a tax is
imposed or threatened with respect to the Trust Fund by any state in which
the
Trustee or the Trust Fund held by the Trustee is located due to the location
of
the Trustee, or (iv) the continued use of the Trustee would result in a
downgrading of the rating by any Rating Agency of any Class of Certificates
with
a rating, then the Depositor shall remove the Trustee and the Depositor shall
appoint a successor trustee by written instrument, one copy of which instrument
shall be delivered to the Trustee so removed, one copy to the successor trustee
and one copy to the Servicer.
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(c) The
Holders of more than 50% of the Class Principal Balance (or Percentage Interest)
of each Class of Certificates may at any time upon 30 days’ written notice to
the Trustee and to the Depositor remove the Trustee by such written instrument,
signed by such Holders or their attorney-in-fact duly authorized, one copy
of
which instrument shall be delivered to the Depositor, one copy to the Trustee
and one copy to the Servicer; the Depositor shall thereupon appoint a successor
trustee in accordance with this Section 6.06.
(d) Any
resignation or removal of the Trustee and appointment of a successor trustee
pursuant to any of the provisions of this Section shall become effective upon
acceptance of appointment by the successor trustee, as provided in
Section 6.07. If no successor trustee shall have been so appointed and
shall have accepted appointment within 30 days after such notice of dismissal,
the Trustee who received such notice of dismissal may petition any court of
competent jurisdiction for the appointment of a successor trustee.
Section
6.07 Successor
Trustee.
(a) Any
successor trustee appointed as provided in Section 6.06 shall execute,
acknowledge and deliver to the Depositor and to its predecessor trustee 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
predecessor trustee shall deliver to the successor trustee all Trustee Mortgage
Files and documents and statements related to each Trustee Mortgage File held
by
it hereunder, and shall duly assign, transfer, deliver and pay over to the
successor trustee the entire Trust Fund, together with all necessary instruments
of transfer and assignment or other documents properly executed necessary to
effect such transfer and such of the records or copies thereof maintained by
the
predecessor trustee in the administration hereof as may be requested by the
successor trustee and shall thereupon be discharged from all duties and
responsibilities under this Agreement. In addition, the Depositor and the
predecessor trustee shall execute and deliver such other instruments and do
such
other things as may reasonably be required to more fully and certainly vest
and
confirm in the successor trustee all such rights, powers, duties and
obligations.
(b) No
successor trustee shall accept appointment as provided in this Section 6.07
unless at the time of such appointment such successor trustee shall be eligible
under the provisions of Section 6.05.
(c) Upon
acceptance of appointment by a successor trustee as provided in this Section
6.07, such successor trustee shall mail notice of the succession of such trustee
hereunder to all Holders of Certificates at their addresses as shown in the
Certificate Register and to any Rating Agency. The costs of such mailing shall
be borne by the Trustee.
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(d) Any
successor trustee shall also serve as auction administrator pursuant to Section
7.01(b).
Section
6.08 Merger
or
Consolidation of Trustee.
Any
Person into which the Trustee may be merged or with which it may be
consolidated, or any Person resulting from any merger, conversion or
consolidation to which the Trustee shall be a party, or any Persons succeeding
to the corporate trust business of the Trustee, shall be the successor to the
Trustee 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 that, such Person shall be eligible under the
provisions of Section 6.05.
Section
6.09 Appointment
of Co-Trustee, Separate Trustee or Custodian.
(a) Notwithstanding
any other provisions hereof, at any time, the Trustee, the Depositor or the
Certificateholders evidencing more than 50% of the Class Principal Balance
(or
Percentage Interest) of every Class of Certificates shall have the power from
time to time to appoint one or more Persons, approved by the Trustee, to act
either as co-trustees jointly with the Trustee, or as separate trustees, or
as
custodians, for the purpose of holding title to, foreclosing or otherwise taking
action with respect to any Mortgage Loan outside the state where the Trustee
has
its principal place of business where such separate trustee or co-trustee is
necessary or advisable (or the Trustee has been advised by the Servicer that
such separate trustee or co-trustee is necessary or advisable) under the laws
of
any state in which a property securing a Mortgage Loan is located or for the
purpose of otherwise conforming to any legal requirement, restriction or
condition in any state in which a property securing a Mortgage Loan is located
or in any state in which any portion of the Trust Fund is located. The separate
Trustees, co-trustees, or custodians so appointed shall be trustees or
custodians for the benefit of all the Certificateholders and shall have such
powers, rights and remedies as shall be specified in the instrument of
appointment; provided,
however,
that no
such appointment shall, or shall be deemed to, constitute the appointee an
agent
of the Trustee.
(b) Every
separate trustee, co-trustee, and custodian shall, to the extent permitted
by
law, be appointed and act subject to the following provisions and
conditions:
(i) all
powers, duties, obligations and rights conferred upon the Trustee in respect
of
the receipt, custody and payment of moneys shall be exercised solely by the
Trustee;
(ii) all
other
rights, powers, duties and obligations conferred or imposed upon the Trustee
shall be conferred or imposed upon and exercised or performed by the Trustee
and
such separate trustee, co-trustee, or custodian jointly, except to the extent
that under any law of any jurisdiction in which any particular act or acts
are
to be performed 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 Trust Fund or any portion thereof in
any
such jurisdiction, shall be exercised and performed by such separate trustee,
co-trustee, or custodian;
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(iii) no
trustee or custodian hereunder shall be personally liable by reason of any
act
or omission of any other trustee or custodian hereunder; and
(iv) the
Trustee may at any time, by an instrument in writing executed by it, with the
concurrence of the Depositor, accept the resignation of or remove any separate
trustee, co-trustee or custodian, so appointed by it or them, if such
resignation or removal does not violate the other terms of this
Agreement.
(c) Any
notice, request or other writing given to the Trustee shall be deemed to have
been given to each of the then separate trustees and co-trustees, as effectively
as if given to each of them. Every instrument appointing any separate trustee,
co-trustee or custodian shall refer to this Agreement and the conditions of
this
Article VI. 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 to, the Trustee. Every
such instrument shall be filed with the Trustee and a copy given to the
Servicer.
(d) Any
separate trustee, co-trustee or custodian 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, co-trustee
or
custodian 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.
(e) No
separate trustee, co-trustee or custodian hereunder shall be required to meet
the terms of eligibility as a successor trustee under Section 6.05
hereunder and no notice to the Certificateholders of the appointment shall
be
required under Section 6.07 hereof.
(f) The
Trust
shall pay the reasonable compensation of the co-trustees (which compensation
shall not reduce any compensation payable to the Trustee under such
Section).
Section
6.10 Authenticating
Agents.
(a) The
Trustee may appoint one or more Authenticating Agents which shall be authorized
to act on behalf of the Trustee in authenticating Certificates. In the absence
of any such appointment, references herein to the Authenticating Agent shall
mean the Trustee. Wherever reference is made in this Agreement to the
authentication of Certificates by the Trustee or the Trustee’s certificate of
authentication, such reference shall be deemed to include authentication on
behalf of the Trustee by an Authenticating Agent and a certificate of
authentication executed on behalf of the Trustee by an Authenticating Agent.
Each Authenticating Agent must be a corporation organized and doing business
under the laws of the United States of America or of any state, having a
combined capital and surplus of at least $15,000,000, authorized under such
laws
to do a trust business and subject to supervision or examination by federal
or
state authorities.
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(b) Any
Person into which any Authenticating Agent may be merged or converted or with
which it may be consolidated, or any Person resulting from any merger,
conversion or consolidation to which any Authenticating Agent shall be a party,
or any Person succeeding to the corporate agency business of any Authenticating
Agent, shall continue to be the Authenticating Agent without the execution
or
filing of any paper or any further act on the part of the Trustee or the
Authenticating Agent.
(c) Any
Authenticating Agent may at any time resign by giving at least 30 days’ advance
written notice of resignation to the Trustee and the Depositor. The Trustee
may
at any time terminate the agency of any Authenticating Agent by giving written
notice of termination to such Authenticating Agent and the Depositor. Upon
receiving a notice of resignation or upon such a termination, or in case at
any
time any Authenticating Agent shall cease to be eligible in accordance with
the
provisions of this Section 6.10, the Trustee may appoint a successor
authenticating agent, shall give written notice of such appointment to the
Depositor and shall mail notice of such appointment to all Holders of
Certificates. Any successor authenticating agent upon acceptance of its
appointment hereunder shall become vested with all the rights, powers, duties
and responsibilities of its predecessor hereunder, with like effect as if
originally named as Authenticating Agent. No successor authenticating agent
shall be appointed unless eligible under the provisions of this
Section 6.10. No Authenticating Agent shall have responsibility or
liability for any action taken by it as such at the direction of the
Trustee.
Section
6.11 Indemnification
of the Trustee.
The
Trustee (in its individual capacity and in its capacity as trustee hereunder)
and its directors, officers, employees and agents shall be entitled to
indemnification from the Trust Fund for any loss, liability or expense
(including the reasonable compensation and the expenses and disbursements of
its
agents or counsel), incurred without negligence or willful misconduct on their
part, arising out of, or in connection with, the acceptance or administration
of
the trusts created hereunder or under the Purchase Agreements, the Servicing
Agreement, Acknowledgements or the Custodial Agreements or in connection with
the performance of their duties hereunder or thereunder including the costs
and
expenses of defending themselves against any claim in connection with the
exercise or performance of any of their powers or duties hereunder or
thereunder, provided
that:
(i) with
respect to any such claim, the Trustee shall have given the Depositor written
notice thereof promptly after the Trustee shall have knowledge
thereof;
(ii) while
maintaining control over its own defense, the Trustee shall cooperate and
consult fully with the Depositor in preparing such defense; and
(iii) notwithstanding
anything to the contrary in this Section 6.11, the Trust Fund shall not be
liable for settlement of any such claim by the Trustee entered into without
the
prior consent of the Depositor, which consent shall not be unreasonably
withheld.
77
The
provisions of this Section 6.11 shall survive any termination of this
Agreement and the resignation or removal of the Trustee or any Custodian and
shall be construed to include, but not be limited to any loss, liability or
expense under any environmental law.
Section
6.12 Fees
and
Expenses of the Trustee.
As
compensation for its services hereunder, the Trustee shall be entitled to
receive all off the investment income on the funds held by it from time to
time
in the Distribution Account. Any expenses incurred by the Trustee shall be
reimbursed in accordance with Section 6.11.
Section
6.13 Collection
of Monies.
Except
as
otherwise expressly provided in this Agreement, the Trustee may demand payment
or delivery of, and shall receive and collect, all money and other property
payable to or receivable by the Trustee pursuant to this Agreement. The Trustee
shall hold all such money and property received by it as part of the Trust
Fund
and shall distribute it as provided in this Agreement.
Section
6.14 Periodic
Filings
(a)
The
Trustee shall reasonably cooperate with the Depositor in connection with the
reporting requirements of the Trust under the Exchange Act. The Trustee shall
prepare for execution by the Depositor any Forms 8-K (other than the initial
report on Form 8-K), 10-D and 10-K required by the Exchange Act and the rules
and regulations of the Commission thereunder, in order to permit the timely
filing thereof pursuant to the terms of this Section 6.14, and the Trustee
shall
file (via the Commission’s Electronic Data Gathering and Retrieval System) such
Forms executed by the Depositor. The Trustee shall have no duty to verify
information received by it from other Persons (other than Subcontractors
utilized by the Trustee) in connection with its duties under this Section
6.14.
(b)
Within 15 calendar days after each Distribution Date (subject to permitted
extensions under the Exchange Act), the Trustee 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 Trustee 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 prepared by the party responsible
for preparing such disclosure as set forth on Exhibit O hereto and the Trustee
shall compile such disclosure pursuant to the following paragraph. The Trustee
will have no duty or liability for any failure hereunder to determine, prepare
or file any Additional Form 10-D Disclosure, except as set forth in the next
paragraph.
As
set
forth on Exhibit O hereto, within 5 calendar days after the related Distribution
Date, certain parties to this Agreement shall be required to provide to the
Trustee and the Depositor, to the extent known by such applicable parties,
any
Additional Form 10-D Disclosure, if applicable. In addition, the Servicer is
obligated under the Servicing Agreement to provide certain information to the
Trustee. The Trustee shall compile all such information provided to it in a
Form
10-D prepared by it.
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After
preparing the Form 10-D, the Trustee shall forward electronically a draft copy
of the Form 10-D to the Depositor for review, verification and execution by
the
Depositor. No later than 2 Business Days prior to the 15th calendar day after
the related Distribution Date, an officer of the Depositor shall sign the Form
10-D and return an electronic or fax copy of such signed Form 10-D (with an
original executed hard copy to follow by overnight mail) to the Trustee. If
a
Form 10-D cannot be filed on time or if a previously filed Form 10-D needs
to be
amended, the Trustee will follow the procedures set forth in Section
6.14(f)(ii). The signing party at the Depositor can be contacted at the
Depositor’s address for notices set forth in Section 10.07, or such other
address as to which the Depositor has provided prior written notice to the
Trustee. The Depositor acknowledges that the performance by the Trustee of
its
duties under this Section 6.14(b) related to the timely preparation and filing
of Form 10-D is contingent upon the Servicer, the Depositor and any other Person
obligated to provide Additional Form 10-D Disclosure as set forth on Exhibit
O
hereto observing all applicable deadlines in the performance of their duties
under this Section 6.14(b) or the applicable provisions of the Servicing
Agreement. The Trustee shall have no liability for any loss, expense, damage,
or
claim arising out of or with respect to any failure to properly prepare and/or
timely file such Form 10-D, where such failure results from the Trustee’s
inability or failure to obtain or receive, on a timely basis, any information
from any party hereto or the Servicer or Custodian (other than the Trustee
or
any Subcontractor utilized by the Trustee) needed to prepare, arrange for
execution or file such Form 10-D, not resulting from its own negligence, bad
faith or willful misconduct.
(c)
Within 90 days 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”),
commencing in March 2007, the Trustee 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 Trustee within the applicable time frames set
forth in this Agreement, (i) an annual compliance statement for the Servicer,
and each Subservicer engaged by the Servicer, and the Trustee, (ii)(A) the
annual reports on assessment of compliance with servicing criteria for the
Trustee, the Servicer, the Custodian, each Subservicer engaged by the Servicer
and each Servicing Function Participant utilized by the Servicer or the Trustee,
and (B) if any such report on assessment of compliance with servicing criteria
identifies any material instance of noncompliance, disclosure identifying such
instance of noncompliance, or such report on assessment of compliance with
servicing criteria is not included as an exhibit to such Form 10-K, disclosure
that such report is not included and an explanation why such report is not
included, (iii)(A) the registered public accounting firm attestation report
for
the Trustee, the Servicer, the Custodian, each Subservicer engaged by the
Servicer and each Servicing Function Participant utilized by the Servicer,
or
the Trustee, and (B) if any registered public accounting firm attestation report
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 in the form attached hereto as Exhibit L,
with such changes as may be necessary or appropriate as a result of changes
promulgated by the Commission (the “Sarbanes Certification”), which shall be
signed by the senior officer of the Depositor in charge of securitization.
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
prepared by party responsible for preparing such disclosure as set forth on
Exhibit P hereto, and the Trustee shall compile such disclosure pursuant to
the
following paragraph. The Trustee will have no duty or liability for any failure
hereunder to determine or prepare any Additional Form 10-K Disclosure, except
as
set forth in the next paragraph.
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As
set
forth on Exhibit P hereto, no later than March 15th of
each
year that the Trust is subject to the Exchange Act reporting requirements,
commencing in 2007, certain parties to this Agreement and the Servicer and
the
Custodian shall be required to provide to the Trustee and the Depositor, to
the
extent known by such applicable parties, any Additional Form 10-K Disclosure,
if
applicable. In addition, the Servicer is obligated under the Servicing Agreement
to provide certain information to the Trustee. The Trustee shall compile all
such information provided to it in a Form 10-K prepared by it.
After
preparing the Form 10-K, the Trustee shall forward electronically a draft copy
of the Form 10-K to the Depositor for review, verification and execution by
the
Depositor. No later than 5:00 p.m. EST on the 3rd Business Day prior to the
10-K
Filing Deadline, an officer of the Depositor shall sign the Form 10-K and return
an electronic or fax copy of such signed Form 10-K (with an original executed
hard copy to follow by overnight mail) to the Trustee. If a Form 10-K cannot
be
filed on time or if a previously filed Form 10-K needs to be amended, the
Trustee will follow the procedures set forth in Section 6.14(f)(ii). The signing
party at the Depositor can be contacted at the Depositor’s address for notices
set forth in Section 10.07, or such other address as to which the Depositor
has
provided prior written notice to the Trustee. The Depositor acknowledges that
the performance by the Trustee of its duties under this Section 6.14(c) related
to the timely preparation and filing of Form 10-K is contingent upon the
Servicer (and any Subservicer or Servicing Function Participant engaged by
the
Servicer) and the Depositor and any other Person obligated to provide Additional
Form 10-K Disclosure as set forth on Exhibit P hereto, observing all applicable
deadlines in the performance of their duties under this Section 6.14(c), Section
6.14(d), or the applicable provisions of the Servicing Agreement. The Trustee
shall have no liability for any loss, expense, damage or claim arising out
of or
with respect to any failure to properly prepare and/or timely file such Form
10-K, where such failure results from the Trustee’s inability or failure to
obtain or receive, on a timely basis, any information from any party hereto
(other than the Trustee or any Subcontractor utilized by the Trustee) 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)
In
connection with the execution of a Sarbanes Certification, the Trustee shall
sign a certification (in the form attached hereto as Exhibit M, with such
changes as may be necessary or appropriate as a result of changes promulgated
by
the Commission) for the benefit of the Depositor and its officers, directors
and
Affiliates, and the Servicer shall sign a certification solely with respect
to
the Servicer (in the form attached to the Servicing Agreement, with such changes
as may be necessary or appropriate as a result of changes promulgated by the
Commission) for the benefit of the Depositor, the Trustee and their respective
officers, directors and Affiliates. Each such certification shall be delivered
to the Depositor no later than March 10th of each year (or if such day is not
a
Business Day, the immediately preceding Business Day) and the Depositor shall
deliver the Sarbanes Certification no later than the time set forth for the
delivery to the Trustee of the signed Form 10-K pursuant to Section 6.14(d)
for
such year. In the event that prior to the filing date of the Form 10-K in March
of each year, the Trustee or the Servicer has actual knowledge of information
material to the Sarbanes Certification, that party shall promptly notify the
Depositor and each of the other parties signing the certifications. In addition,
the Trustee shall indemnify and hold harmless the Depositor and the Sponsor
and
their officers, directors, employees, agents and Affiliates from and against
any
losses, damages, penalties, fines, forfeitures, reasonable and necessary legal
fees and related costs, judgments and other costs and expenses arising out
of or
based upon any breach of the Trustee’s obligations under this Section 6.14(d) or
any material misstatement or material omission contained in any information,
report, certification or other material provided by the Trustee in written
or
electronic form pursuant to Section 6.14 of this Agreement and Exhibits O,
P and
Q to this Agreement provided by the Trustee (excluding any information, report,
accountants’ letter, certification or other materials provided in written or
electronic form by or on behalf of any Person other than the Trustee or any
Subcontractor utilized by the Trustee), which results from negligence, bad
faith
or willful misconduct on the part of the Trustee in connection therewith. If
the
indemnification provided for herein is unavailable or insufficient to hold
harmless any indemnified party, then the Trustee agrees in connection with
a
breach of the Trustee’s obligations under this Section 6.14(d) or any material
misstatement or material omission contained in any information, report,
certification or other material provided in written or electronic form pursuant
to Section 6.14 of this Agreement and Exhibits O, P and Q to this Agreement
provided by or on behalf of the Trustee (excluding any information, report,
certification, accountants’ letter or other materials provided in written or
electronic form by or on behalf of any Person other than the Trustee or any
Subcontractor utilized by the Trustee), results from the negligence, bad faith
or willful misconduct on the part of the Trustee in connection therewith that
it
shall contribute to the amount paid or payable by the Depositor and the Sponsor
as a result of the losses, claims, damages or liabilities of the Depositor
and
the Sponsor in such proportion as is appropriate to reflect the relative fault
of the Depositor and the Sponsor on the one hand and the Trustee on the
other.
(e)
Upon
any filing with the Commission, the Trustee shall promptly deliver to the
Depositor a copy of each such executed report, statement or
information.
(f)
(i)
The obligations set forth in paragraphs (a) through (d) of this Section shall
only apply with respect to periods for which reports are required to be filed
with respect to the Trust under the Exchange Act. Prior to January 30 of the
first year in which the Trustee is able to do so under applicable law, the
Trustee shall file a Form 15 Suspension Notification with respect to the Trust,
with a copy to the Depositor. At any time after the filing of a Form 15
Suspension Notification, if the number of Holders of the Offered Certificates
of
record exceeds the number set forth in Section 15(d) of the Exchange Act or
the
regulations promulgated pursuant thereto which would cause the Trust to again
become subject to the reporting requirements of the Exchange Act, the Trustee
shall recommence preparing and filing reports on Form 10-K, 10-D and 8-K as
required pursuant to this Section 6.14 and the parties hereto shall again have
the obligations set forth in this Section, in Section 12 of the Custodial
Agreement and Section 5.04 of the Servicing Agreement.
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(ii)
In
the event that the Trustee 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 pursuant
to 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, the Trustee will immediately notify the Depositor and the
Servicer. In the case of Form 10-D and 10-K, the Depositor, the Servicer and
the
Trustee will thereupon 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 Trustee will, upon receipt of all disclosure information
required to be included on Form 8-K, 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, the party to this Agreement deciding that an amendment
to
such Form 8-K, 10-D or 10-K is required will notify the Depositor, the Trustee
and the Servicer and such parties will cooperate to prepare any necessary Form
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 an officer of the Depositor. The Depositor
acknowledges that the performance by the Trustee of its duties under this
Section 6.14(f) related to the timely preparation and filing of Form 15, a
Form
12b-25 or any amendment to Form 8-K, 10-D or 10-K is contingent upon the
Servicer, the Depositor observing all applicable deadlines in the performance
of
their duties under this Section 6.14 or the applicable provisions of the
Servicing Agreement. The Trustee 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 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 Trustee’s inability or failure
to obtain or receive, on a timely basis, any information from the Depositor,
the
Servicer or the Custodian (other than the Trustee or any Subcontractor utilized
by the Trustee) 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.
(g)
Within four (4) Business Days after the occurrence of an event requiring
disclosure on Form 8-K (each such event, a “Reportable
Event”),
and
also if requested by the Depositor, the Trustee shall prepare and file on behalf
of the Trust 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 prepared by the party responsible for preparing such
disclosure as set forth on Exhibit Y hereto and compiled by the Trustee pursuant
to the following paragraph. The Trustee will have no duty or liability for
any
failure hereunder to determine or prepare any Form 8-K Disclosure Information
or
any Form 8-K, except as set forth in the next paragraph.
As
set
forth on Exhibit Q hereto, for so long as the Trust is subject to the Exchange
Act reporting requirements, no later than noon on the 2nd Business Day after
the
occurrence of a Reportable Event, certain parties to this Agreement and the
Servicer under the Servicing Agreement shall be required to provide to the
Depositor and the Trustee, to the extent known by such applicable parties,
any
Form 8-K Disclosure Information, if applicable. In addition, the Servicer is
obligated under the Servicing Agreement to provide certain information to the
Trustee. The Trustee shall compile all such information provided to it in a
Form
8-K prepared by it.
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After
preparing the Form 8-K, the Trustee shall forward electronically a draft copy
of
the Form 8-K to the Depositor for review, verification and execution by the
Depositor. No later than the end of the 3rd Business Day after the Reportable
Event, an officer of the Depositor shall sign the Form 8-K and return an
electronic or fax copy of such signed Form 8-K (with an original executed hard
copy to follow by overnight mail) to the Trustee. If a Form 8-K cannot be filed
on time or if a previously filed Form 8-K needs to be amended, the Trustee
will
follow the procedures set forth in Section 6.14(f)(ii). The signing party at
the
Depositor can be contacted at the Depositor’s address for notices set forth in
Section 10.07, or such other address as to which the Depositor has provided
prior written notice to the Trustee. The Depositor acknowledges that the
performance by the Trustee of its duties under this Section 6.14(g) related
to
the timely preparation and filing of Form 8-K is contingent upon the Servicer,
the Depositor and any other Person obligated to provide Form 8-K Disclosure
Information as set forth on Exhibit Q hereto, observing all applicable deadlines
in the performance of their duties under this Section 6.14(g). The Trustee
shall
have no liability for any loss, expense, damage or claim arising out of or
with
respect to any failure to properly prepare and/or timely file such Form 8-K,
where such failure results from the Trustee’s inability or failure to obtain or
receive, on a timely basis, any information from any party hereto (other than
the Trustee or any Subcontractor utilized by the Trustee) needed to prepare,
arrange for execution or file such Form 8-K, not resulting from its own
negligence, bad faith or willful misconduct.
(h)
The
Trustee shall have no liability for any loss, expense, damage or claim arising
out of or resulting from (i) the accuracy or inaccuracy of any Additional Form
10-D Disclosure, Additional Form 10-K Disclosure or Form 8-K Disclosure
Information (excluding any information therein provided by the Trustee or any
Subcontractor utilized by the Trustee) provided to the Trustee in connection
with the preparation of Forms 10-D, 10-K and 8-K pursuant to this Section 6.14,
or (ii) the failure of the Depositor to timely execute and return for filing
any
Forms 10-D, 10-K and 8-K required to be filed by the Trustee pursuant to this
Section 6.14, in either case, not resulting from the Trustee’s own negligence,
bad faith or misconduct.
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ARTICLE
VII
PURCHASE
OF MORTGAGE LOANS AND
TERMINATION
OF THE TRUST FUND
Section
7.01 Purchase
of Mortgage Loans; Termination of Trust Fund Upon Purchase or Liquidation of
All
Mortgage Loans.
(a) The
obligations and responsibilities of the Trustee created hereby (other than
the
obligation of the Trustee to make payments to the Certificateholders as set
forth in Section 7.02), shall terminate on the earliest of (i) the
final payment or other liquidation of the last Mortgage Loan remaining in the
Trust Fund and the disposition of all REO Property, (ii) the sale or
auction of the property held by the Trust Fund in accordance with
Section 7.01(b) or 7.01(c) and (iii) the Latest Possible Maturity
Date; provided,
however,
that in
no event shall the Trust Fund created hereby continue beyond the expiration
of
21 years from the death of the last survivor of the descendants of Xxxxxx X.
Xxxxxxx, the late Ambassador of the United States to the Court of St. James’s,
living on the date hereof. Any termination of the Trust Fund shall be carried
out in such a manner so that the termination of each REMIC included therein
shall qualify as a “qualified liquidation” under the REMIC
Provisions.
(b) On
the
Initial Optional Termination Date, at the option of and in consultation with
the
Depositor, the Auction Administrator shall solicit bids for the Pool Assets
from
at least three institutions that are regular purchasers and/or sellers in the
secondary market of residential whole mortgage loans similar to the Mortgage
Loans. If the Auction Administrator receives at least three bids for the Pool
Assets, and one of such bids is equal to or greater than the Minimum Auction
Price, the Auction Administrator shall sell the related Pool Assets to the
highest bidder (the “Auction
Purchaser”)
at the
price offered by the Auction Purchaser (the “Mortgage
Loan Auction Price”).
If
the Auction Administrator receives less than three bids, or does not receive
any
bid that is at least equal to the Minimum Auction Price, unless the Servicer
exercises its option under subsection (c) below, the Auction Administrator
shall, on each six-month anniversary of the initial Optional Termination Date,
repeat these auction procedures until the Auction Administrator receives a
bid
that is at least equal to the Minimum Auction Price, at which time the Auction
Administrator shall sell the Pool Assets to the Auction Purchaser at that
Mortgage Loan Auction Price; provided,
however,
that
the Auction Administrator shall not be required to repeat these auction
procedures on any Distribution Date for any six-month anniversary of the initial
Optional Termination Date unless the Auction Administrator reasonably believes
that there is a reasonable likelihood of receiving a bid of at least the Minimum
Auction Price. The Auction Administrator shall give notice to the Rating
Agencies and the Servicer that is servicing any of the Mortgage Loans of the
sale of the Pool Assets pursuant to this Section 7.01(b) (an “Auction
Sale”)
and of
the date of such auction (the “Auction
Date”).
The
Trustee may engage an investment banking firm and/or other agents in connection
with the Auction, the cost of which shall be included in the Minimum Auction
Price (unless an Optional Termination does not occur in which case such costs
shall be an expense of the Trust Fund); provided, however, that any such
engagement and the choice of any such investment banking firm and/or other
agents shall be subject to the consent of the Depositor.
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(c) On
any
Distribution Date occurring after the Initial Optional Purchase Date, the
Servicer shall have the option to cause the Trust Fund to adopt a plan of
complete liquidation of the Mortgage Loans pursuant to Sections 7.02 and
7.03 hereof to sell all of the property related thereto. If the Servicer elects
to exercise such option, it shall no later than 30 days prior to the
Distribution Date selected for purchase of the Mortgage Loans and all other
assets of the Trust Fund (the “Purchase
Date”)
deliver written notice to the Trustee and either (a) deposit in the
Distribution Account the related Redemption Price or (b) state in such
notice that the Redemption Price shall be deposited in the Distribution Account
not later than 10:00 a.m., New York City time, on the applicable Purchase Date.
Upon exercise of such option, the property of the Trust Fund shall be sold
to
the Servicer at a price equal to the related Redemption Price.
(d) The
Depositor, the Servicer, the Trustee and each Custodian shall be reimbursed
from
the Redemption Price for any P&I Advances, Servicer Advances, accrued and
unpaid Servicing Fees or other amounts with respect to the Mortgage Loans and
any related assets being purchased pursuant to Section 7.01(b) or 7.01(c) above
that are reimbursable to such parties (and such other amounts which, if not
related to the Mortgage Loans and other assets of the Trust Fund not being
purchased, that are then due and owing to any such Person) under this Agreement
and the Servicing Agreement or the related Custodial Agreement.
Section
7.02 Procedure
Upon Redemption of Trust Fund.
(a) Notice
of
any termination pursuant to the provisions of Section 7.01, specifying the
Distribution Date upon which the final distribution shall be made or the
purchase of the Trust’s assets will occur, shall be given promptly by the
Trustee by first class mail to the Certificateholders mailed in the case of
a
redemption of the Certificates, no later than (i) the first day of the month
in
which the Distribution Date selected for redemption of such Certificates shall
occur or (ii) upon (x) the sale of all of the property of the Trust Fund by
the Trustee or in the case of a sale of assets of the Trust Fund, or
(y) upon the final payment or other liquidation of the last Mortgage Loan
or REO Property in the Trust Fund. Such notice shall specify (A) the
Initial Optional Purchase Date, Distribution Date upon which final distribution
on the Certificates of all amounts required to be distributed to
Certificateholders pursuant to Section 5.02 will be made upon presentation
and surrender of the Certificates at the Certificate Registrar’s Corporate Trust
Office, and (B) that the Record Date otherwise applicable to such
Distribution Date is not applicable, distribution being made only upon
presentation and surrender of the Certificates at the office or agency of the
Trustee therein specified. The Trustee shall give such notice to the Certificate
Registrar, if not the Trustee, at the time such notice is given to Holders
of
the Certificates. Upon any such termination, the duties of the Certificate
Registrar with respect to the affected Certificates shall terminate and the
Trustee shall terminate the Distribution Account and any other account or fund
maintained with respect to the Certificates, subject to the Trustee’s obligation
hereunder to hold all amounts payable to Certificateholders in trust without
interest pending such payment.
(b) In
the
event that all of the Holders do not surrender their Certificates for
cancellation within three months after the time specified in the above-mentioned
written notice, the Trustee 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 one year after the second
notice any Certificates shall not have been surrendered for cancellation, the
Trustee may take appropriate steps to contact the remaining Certificateholders
concerning surrender of such Certificates, and the cost thereof shall be paid
out of the amounts distributable to such Holders. If within two years after
the
second notice any Certificates shall not have been surrendered for cancellation,
the Trustee shall deliver any remaining funds being held by it to the Holder
of
the Class R Certificates and the Holder of the Class R Certificates shall,
subject to applicable state law relating to escheatment, hold all amounts
distributable to such Holders for the benefit of such Holders. No interest
shall
accrue on any amount held by the Trustee and not distributed to a
Certificateholder due to such Certificateholder’s failure to surrender its
Certificate(s) for payment of the final distribution thereon in accordance
with
this Section 7.02. The foregoing provisions are intended to distribute to each
Class of Certificates any accrued and unpaid interest and/or principal to which
they are entitled based on their Pass-Through Rates and Class Certificate
Balances set forth in the Preliminary Statement upon liquidation of the Trust
Fund.
85
(c) Any
reasonable expenses incurred by the Trustee in connection with any purchase
or
termination or liquidation of the portion of the Trust Fund shall be reimbursed
from proceeds received from the liquidation of the Trust Fund.
(d) Any
purchase of the Pool Assets by the Auction Purchaser shall be made on an Auction
Date by receipt of the Auction Administrator of the Mortgage Loan Auction Price
from the Auction Purchaser, and deposit of the Mortgage Loan Auction Price
into
the Distribution Account by the Auction Administrator before the Distribution
Date on which such purchase is effected. Upon deposit of such purchase price
into the Distribution Account, the Trustee shall, upon request and at the
expense of the Auction Purchaser execute and deliver all such instruments of
transfer or assignment, in each case without recourse, as shall be reasonably
requested by the Auction Purchaser to vest title in the Auction Purchaser in
the
Pool Assets so purchased and shall transfer or deliver to the Auction Purchaser
the purchased Pool Assets.
Section
7.03 Additional
Trust Fund Termination Requirements.
(a) On
the
termination of the Trust Fund under Section 7.01 (a), upon an Auction Sale
pursuant to Section 7.01(b) or upon the exercise of the right to purchase all
of
the Mortgage Loans pursuant to Section 7.01(c), the Trustee shall comply with
requirements of this Section 7.03 with respect to each REMIC and with respect
to
the Certificates, unless the party having the right to purchase the assets
of
the Affected REMIC (the “Purchaser”)
delivers to the Trustee, an Opinion of Counsel (at the Servicer’s expense),
addressed to the Trustee to the effect that the failure of the Trustee to comply
with the requirements of this Section 7.03 will not result in an Adverse REMIC
Event:
(i) Within
89
days prior to the time of making the final payment on the Certificates, (and
upon notification by (1) the Auction Administrator in the case of a purchase
under Section 7.01(b) or (2) the Servicer in the case of a purchase under
Section 7.01(c)) the Trustee shall adopt on behalf of each REMIC, a plan of
complete liquidation, meeting the requirements of a qualified liquidation under
the REMIC Provisions;
86
(ii) Any
sale
of the assets of any REMIC shall be for cash and shall occur at or after the
time the plan of complete liquidation is adopted and prior to the time the
final
payments on the Certificates are made;
(iii)
On the
date specified for final payment of the Certificates, the Trustee shall make
final distributions of principal and interest on the Certificates in accordance
with Section 5.02 and, after payment of, or provision for any outstanding
expenses, distribute or credit, or cause to be distributed or credited, to
the
Holders of the Residual Certificates all cash on hand after such final payment
(other than cash retained to meet claims), and the portion of the Trust Fund
(and each REMIC) shall terminate at that time; and
(i) In
no
event may the final payment on the Certificates or the final distribution or
credit to the Holders of the Residual Certificates be made after the 89th day
from the date on which the plan of complete liquidation is adopted.
(b) By
its
acceptance of a Residual Certificate, each Holder thereof hereby agrees to
accept the plan of complete liquidation adopted by the Trustee under this
Section 7.03 and to take such other action in connection therewith as may be
reasonably requested by the Trustee or the Servicer.
Section
7.04 Charged-off
Loans and Released Mortgage Loans.
Notwithstanding
anything to the contrary contained in this Agreement, each Charged-off Loan
that
becomes a Released Mortgage Loan shall be released from the Trust Fund as soon
as practicable after the Trustee has received notice in writing from the
Servicer that a Mortgage Loan has become a Released Mortgage Loan. Upon receipt
of such notice, the Trustee shall cause the related Custodian to release to
the
Released Mortgage Transferee the related Trustee Mortgage File and the Trustee
shall execute and delivery such instruments of transfer or assignment, in each
case without recourse, representation or warranty, as the Released Mortgage
Transferee shall furnish to the Trustee and as shall be necessary to vest in
such party the Mortgage Loan released pursuant hereto. Thereafter (i) the
Released Mortgage Loan shall no longer constitute part of the Trust Fund or
be
an asset of any REMIC, and the Released Mortgage Transferee shall be entitled
to
any amounts subsequently received in respect of any such Released Mortgage
Loans, (ii) the Released Mortgage Transferee may designate any servicer to
service any such Released Mortgage Loan and (iii) the Released Mortgage
Transferee may sell any such Released Mortgage Loan to a third party. For
purposes of compliance with the REMIC Provisions, any such Released Mortgage
Loan transferred to the Released Mortgage Transferee pursuant to this Section
7.04 and having any value as of the date of such transfer shall be treated
as
having been transferred by the related REMIC as additional compensation for
services provided to such REMIC and if no such services were provided, as an
additional distribution to the Class OC Certificates.
87
ARTICLE
VIII
RIGHTS
OF
CERTIFICATEHOLDERS
Section
8.01 Limitation
on Rights of Holders.
(a) The
death
or incapacity of any Certificateholder shall not operate to terminate this
Agreement or this Trust Fund, nor entitle such Certificateholder’s legal
representatives or heirs to claim an accounting or take any action or proceeding
in any court for a partition or winding up of this Trust Fund, nor otherwise
affect the rights, obligations and liabilities of the parties hereto or any
of
them. Except as otherwise expressly provided herein, no Certificateholder,
solely by virtue of its status as a Certificateholder, shall have any right
to
vote or in any manner otherwise control the Trustee or 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 person by reason of any action taken by the parties
to this Agreement pursuant to any provision hereof.
(b) No
Certificateholder, solely by virtue of its status as Certificateholder, shall
have any right by virtue or by availing of any provision 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 the Holders of Certificates evidencing
not less than 25% of the Class Principal Amount or Percentage Interest of
Certificates of each Class affected thereby shall have made written request
upon
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 cost, expenses and liabilities to be
incurred therein or thereby, and the Trustee, for sixty 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 and no direction inconsistent
with such written request has been given such Trustee during such sixty-day
period by such Certificateholders; 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 of any
provision of this Agreement to affect, disturb or prejudice the rights of the
Holders of any other of such 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 benefit
of all Certificateholders. For the protection and enforcement of the provisions
of this Section 8.01, each and every Certificateholder and the Trustee shall
be
entitled to such relief as can be given either at law or in equity.
Section
8.02 Access
to
List of Holders.
(a) If
the
Trustee is not acting as Certificate Registrar, the Certificate Registrar will
furnish or cause to be furnished to the Trustee, within fifteen days after
receipt by the Certificate Registrar of a request by the Trustee in writing,
a
list, in such form as the Trustee may reasonably require, of the names and
addresses of the Certificateholders of each Class as of the most recent Record
Date.
88
(b) If
three
or more Holders or Certificate Owners (hereinafter referred to as “Applicants”)
apply
in writing to the Certificate Registrar, and such application states that the
Applicants desire to communicate with other Holders with respect to their rights
under this Agreement or under the Certificates and is accompanied by a copy
of
the communication which such Applicants propose to transmit, then the
Certificate Registrar shall, within five Business Days after the receipt of
such
application, afford such Applicants reasonable access during the normal business
hours of the Certificate Registrar to the most recent list of Certificateholders
held by the Certificate Registrar or shall, as an alternative, send, at the
Applicants’ expense, the written communication proffered by the Applicants to
all Certificateholders at their addresses as they appear in the Certificate
Register.
(c) Every
Holder or Certificate Owner, if the Holder is a Clearing Agency, by receiving
and holding a Certificate, agrees with the Depositor, the Certificate Registrar
and the Trustee that none of the Depositor, the Certificate Registrar nor the
Trustee shall be held accountable by reason of the disclosure of any such
information as to the names and addresses of the Certificateholders hereunder,
regardless of the source from which such information was derived.
Section
8.03 Acts
of
Holders of Certificates.
(a) Any
request, demand, authorization, direction, notice, consent, waiver or other
action provided by this Agreement to be given or taken by Holders or Certificate
Owners, if the Holder is a Clearing Agency, may be embodied in and evidenced
by
one or more instruments of substantially similar tenor signed by such Holders
in
person or by agent duly appointed in writing; and, except as herein otherwise
expressly provided, such action shall become effective when such instrument
or
instruments are delivered to the Trustee. Such instrument or instruments (as
the
action embodies therein and evidenced thereby) are herein sometimes referred
to
as an “Act”
of
the
Holders signing such instrument or instruments. Proof of execution of any such
instrument or of a writing appointing any such agents shall be sufficient for
any purpose of this Agreement and conclusive in favor of the Trustee, if made
in
the manner provided in this Section 8.03.
(b) The
fact
and date of the execution by any Person of any such instrument or writing may
be
proved by the affidavit of a witness of such execution or by the certificate
of
any notary public or other officer authorized by law to take acknowledgments
or
deeds, certifying that the individual signing such instrument or writing
acknowledged to him the execution thereof. Whenever such execution is by an
officer of a corporation or a member of a partnership on behalf of such
corporation or partnership, such certificate or affidavit shall also constitute
sufficient proof of his authority. The fact and date of the execution of any
such instrument or writing, or the authority of the individual executing the
same, may also be proved in any other manner which the Trustee deems
sufficient.
(c) The
ownership of Certificates (whether or not such Certificates shall be overdue
and
notwithstanding any notation of ownership or other writing thereon made by
anyone other than the Trustee) shall be proved by the Certificate Register,
and
neither the Trustee nor the Depositor shall be affected by any notice to the
contrary.
89
(d) Any
request, demand, authorization, direction, notice, consent, waiver or other
action by the Holder of any Certificate shall bind every future Holder of the
same Certificate and the Holder of every Certificate issued upon the
registration of transfer thereof or in exchange therefor or in lieu thereof,
in
respect of anything done, omitted or suffered to be done by the Trustee in
reliance thereon, whether or not notation of such action is made upon such
Certificate.
ARTICLE
IX
REMIC
ADMINISTRATION
Section
9.01 REMIC
Administration.
(a) REMIC
elections as set forth in the Preliminary Statement shall be made on Forms
1066
or other appropriate federal tax or information return for the taxable year
ending on the last day of the calendar year in which the Certificates are
issued. The regular interests and residual interest in each REMIC shall be
as
designated in the Preliminary Statement.
(b) The
Closing Date is hereby designated as the “Startup
Day”
of
each
REMIC within the meaning of section 860G(a)(9) of the Code. The latest
possible maturity date for purposes of Treasury Regulation 1.860G-1(a)(4)
will be the Latest Possible Maturity Date.
(c) The
Trustee shall represent the Trust Fund in any administrative or judicial
proceeding relating to an examination or audit by any governmental taxing
authority with respect thereto. The Trustee shall pay any and all tax related
expenses (not including taxes) of each REMIC, including but not limited to
any
professional fees or expenses related to audits or any administrative or
judicial proceedings with respect to such REMIC that involve the Internal
Revenue Service or state tax authorities, but only to the extent that
(i) such expenses are ordinary or routine expenses, including expenses of a
routine audit but not expenses of litigation (except as described in (ii));
or
(ii) such expenses or liabilities (including taxes and penalties) are
attributable to the negligence or willful misconduct of the Trustee in
fulfilling its duties hereunder (including its duties as tax return preparer).
The Trustee shall be entitled to reimbursement of expenses to the extent
provided in clause (i) above from the Distribution Account, provided,
however,
the
Trustee shall not be entitled to reimbursement for expenses incurred in
connection with the preparation of tax returns and other reports as required
by
this Section 9.01.
(d) The
Trustee shall prepare, sign and file all of each REMIC’s federal and appropriate
state tax and information returns as such REMIC’s direct representative. The
expenses of preparing and filing such returns shall be borne by the Trustee.
In
preparing such returns, the Trustee shall, with respect to each REMIC other
than
the Master REMIC: (i) treat the accrual period for interests in such REMIC
as the calendar month; (ii) account for distributions made from each REMIC
other than the Master REMIC as made on the first day of each succeeding calendar
month; (iii) account for income under the all-OID method at the weighted
average of the Net Mortgage Rates; (iv) use the aggregation method provided
in Treasury Regulation section 1.1275-2(c); and (v) account for
income and expenses related to each REMIC other than the Master REMIC in the
manner resulting in the lowest amount of excess inclusion income possible
accruing to the Holder of the residual interest in each such REMIC.
90
(e) The
Trustee or its designee shall perform on behalf of each REMIC all reporting
and
other tax compliance duties that are the responsibility of such REMIC under
the
Code, the REMIC Provisions, or other compliance guidance issued by the Internal
Revenue Service or any state or local taxing authority. Among its other duties,
if required by the Code, the REMIC Provisions, or other such guidance, the
Trustee shall provide, upon receipt of additional reasonable compensation,
(i) to the Treasury or other governmental authority such information as is
necessary for the application of any tax relating to the transfer of a Residual
Certificate to any disqualified person or organization pursuant to Treasury
Regulation 1.860E-2(a)(5) and any person designated in
Section 860E(e)(3) of the Code and (ii) to the Certificateholders and
the Trustee such information or reports as are required by the Code or REMIC
Provisions.
(f) To
the
extent within their control, the Trustee and the Holders of Certificates shall
take any action or cause any REMIC to take any action necessary to maintain
the
status of any REMIC as a REMIC under the REMIC Provisions and shall assist
each
other as necessary to create or maintain such status. Neither the Trustee nor
the Holder of any Residual Certificate shall knowingly take any action, cause
any REMIC to take any action or fail to take (or fail to cause to be taken)
any
action that, under the REMIC Provisions, if taken or not taken, as the case
may
be, could result in an Adverse REMIC Event unless the Trustee has received
an
Opinion of Counsel (at the expense of the party seeking to take such action)
to
the effect that the contemplated action will not endanger such status or result
in the imposition of such a tax. In addition, prior to taking any action with
respect to any REMIC or the assets therein, or causing any REMIC to take any
action, which is not expressly permitted under the terms of this Agreement,
any
Holder of a Residual Certificate will consult with the Trustee or its designee,
in writing, with respect to whether such action could cause an Adverse REMIC
Event to occur with respect to any REMIC, and no such Person shall take any
such
action or cause any REMIC to take any such action as to which the Trustee has
advised it in writing that an Adverse REMIC Event could occur; provided,
however,
that if
no Adverse REMIC Event would occur but such action could result in the
imposition of additional taxes on the Residual Certificateholders, no such
Person shall take any such action, or cause any REMIC to take any such action
without the written consent of the Residual Certificateholders.
(g) Each
Holder of a Residual Certificate shall pay when due any and all taxes imposed
on
the related REMIC by federal or state governmental authorities. To the extent
that such taxes are not paid by a Residual Certificateholder, the Paying Agent
shall pay any remaining REMIC taxes out of current or future amounts otherwise
distributable to the Holder of the Residual Certificate in any such REMIC or,
if
no such amounts are available, (A) out of other amounts held in the Distribution
Account, and shall reduce amounts otherwise payable to holders of regular
interests in any such REMIC or (B) to the extent that any such taxes are imposed
on the REMIC as a result of the breach of any representation, warranty or
covenant of the Trustee, then the Trustee shall pay when due any and all such
taxes.
(h) The
Trustee shall, for federal income tax purposes, maintain books and records
with
respect to each REMIC on a calendar year and on an accrual basis.
91
(i) No
additional contributions of assets shall be made to any REMIC, except as
expressly provided in this Agreement.
(j) The
Trustee shall not enter into any arrangement by which any REMIC will receive
a
fee or other compensation for services.
(k) The
Class R Holder shall act as “tax matters person” with respect to each REMIC
created hereunder and the Trustee shall act as agent for the Class R Holder
in such roles, unless and until another party is so designated by the
Class R Holder.
(l) The
Trustee shall treat the rights of the LIBOR Certificateholders to receive Basis
Risk Carryforward Amounts as rights in an interest rate cap contract written
by
the Class OC Certificateholder in favor of such Certificateholders. Thus, each
LIBOR Certificateholder shall be treated as representing not only ownership
of
regular interests in a REMIC, but also ownership of an interest in an interest
rate cap contract. For tax purposes the interest rate cap contract will be
deemed to have a value of $10,000.
Section
9.02 Prohibited
Transactions and Activities.
Neither
the Depositor nor the Trustee shall sell, dispose of, or substitute for any
of
the Mortgage Loans, except in a disposition pursuant to (i) the foreclosure
of a Mortgage Loan, (ii) the bankruptcy of the Trust Fund, (iii) the
termination of each REMIC pursuant to Article VII of this Agreement, (iv) a
substitution pursuant to Article II of this Agreement or (v) a repurchase
of Mortgage Loans pursuant to Article II of this Agreement, nor acquire any
assets for any REMIC, nor sell or dispose of any investments in the Distribution
Account for gain, nor accept any contributions to any REMIC after the Closing
Date, unless it has received an Opinion of Counsel (at the expense of the party
causing such sale, disposition, substitution or acceptance) that such
disposition, acquisition, substitution, or acceptance will not result in an
Adverse REMIC Event, (b) affect the distribution of interest or principal
on the Certificates or (c) result in the encumbrance of the assets
transferred or assigned to the Trust Fund (except pursuant to the provisions
of
this Agreement).
The
Trustee with respect to the Mortgage Loans shall not permit the Servicer to
consent to any modification of any such Mortgage Loan for which the consent
of
the Trustee is required under the Servicing Agreement under which such Mortgage
Loan is serviced, that would (i) increase the interest rate in respect of such
Mortgage, defer for a period in excess of six months or forgive the payment
of
any principal or interest, reduce the outstanding principal amount (except
for
actual payments of principal), increase the Servicing Fee on such Mortgage
Loan
or extend the final maturity date on such Mortgage Loan, or (ii) result in
a
substitution or release of collateral or in the provision of additional
collateral for the Mortgage Loan, unless the applicable Mortgage Loan is in
default or default is reasonably foreseeable in respect of such Mortgage Loan,
or the Trustee has received an Opinion of Counsel (at the expense of the party
requesting consent for such modification) that such modification will not result
in an Adverse REMIC Event.
92
Section
9.03 Indemnification
with Respect to Prohibited Transactions or Loss of REMIC Status.
Upon
the
occurrence of an Adverse REMIC Event due to the negligent performance by the
Trustee of its duties and obligations set forth herein, the Trustee shall
indemnify the Certificateholders of the related Residual Certificate against
any
and all losses, claims, damages, liabilities or expenses (“Losses”)
resulting from such negligence; provided,
however,
that
the Trustee shall not be liable for any such Losses attributable to the action
or inaction of the Depositor or the Holder of the Residual Certificate, nor
for
any such Losses resulting from misinformation provided by any of the foregoing
parties on which the Trustee has relied. Notwithstanding the foregoing, however,
in no event shall the Trustee have any liability (1) for any action or
omission that is taken in accordance with and in compliance with the express
terms of, or which is expressly permitted by the terms of, this Agreement or
under any Purchase Agreement or Servicing Agreements or under any
Acknowledgement, (2) for any Losses other than arising out of malfeasance,
willful misconduct or negligent performance by the Trustee of its duties and
obligations set forth herein, and (3) for any special or consequential
damages to Certificateholders of the related Residual Certificate (in addition
to payment of principal and interest on the Certificates).
Section
9.04 REO
Property.
(a) Notwithstanding
any other provision of this Agreement, the Trustee shall not, except to the
extent provided in the Servicing Agreement, knowingly permit (if the permission
of the Trustee is required by the Servicing Agreement) the Servicer to, rent,
lease, or otherwise earn income on behalf of any REMIC with respect to any
REO
Property which might cause an Adverse REMIC Event unless the Servicer has
provided to the Trustee an Opinion of Counsel concluding that, under the REMIC
Provisions, such action would not adversely affect the status of any REMIC
as a
REMIC and any income generated for any REMIC by the REO Property would not
result in an Adverse REMIC Event.
(b) The
Depositor shall cause the Servicer (to the extent provided in its Servicing
Agreement) to make reasonable efforts to sell any REO Property for its fair
market value. In any event, however, the Depositor shall, or shall cause the
Servicer (to the extent provided in its Servicing Agreement) to, dispose of
any
REO Property within three years of its acquisition by the Trust Fund unless
the
Depositor or the Servicer (on behalf of the Trust Fund) has received a grant
of
extension from the Internal Revenue Service to the effect that, under the REMIC
Provisions and any relevant proposed legislation and under applicable state
law,
the REMIC may hold REO Property for a longer period without causing an Adverse
REMIC Event. If such an extension has been received, then the Depositor, acting
on behalf of the Trustee hereunder, shall, or shall cause the Servicer to,
continue to attempt to sell the REO Property for its fair market value for
such
period longer than three years as such extension permits (the “Extended
Period”).
If
such an extension has not been received and the Depositor or the Servicer,
acting on behalf of the Trust Fund hereunder, is unable to sell the REO Property
within 33 months after its acquisition by the Trust Fund or if such an
extension, has been received and the Depositor or the Servicer is unable to
sell
the REO Property within the period ending three months before the close of
the
Extended Period, the Depositor shall cause the Servicer, before the end of
the
three year period or the Extended Period, as applicable, to (i) purchase
such REO Property at a price equal to the REO Property’s fair market value or
(ii) auction the REO Property to the highest bidder (which may be the
Servicer) in an auction reasonably designed to produce a fair price prior to
the
expiration of the three-year period or the Extended Period, as the case may
be.
93
ARTICLE
X
MISCELLANEOUS
PROVISIONS
Section
10.01 Binding
Nature of Agreement; Assignment.
This
Agreement shall be binding upon and inure to the benefit of the parties hereto
and their respective successors and permitted assigns.
Section
10.02 Entire
Agreement.
This
Agreement contains the entire agreement and understanding among the parties
hereto with respect to the subject matter hereof, and supersedes all prior
and
contemporaneous agreements, understandings, inducements and conditions, express
or implied, oral or written, of any nature whatsoever with respect to the
subject matter hereof. The express terms hereof control and supersede any course
of performance and/or usage of the trade inconsistent with any of the terms
hereof.
Section
10.03 Amendment.
(a) This
Agreement may be amended from time to time by the Depositor and the Trustee,
without notice to or the consent of any of the Holders, (i) to cure any
ambiguity or mistake, (ii) to cause the provisions herein to conform to or
be consistent with or in furtherance of the statements made with respect to
the
Certificates, the Trust Fund or this Agreement in any Offering Document, or
to
correct or supplement any provision herein which may be inconsistent with any
other provisions herein or with the provisions of any Purchase Agreement or
Servicing Agreement, (iii) to make any other provisions with respect to
matters or questions arising under this Agreement or (iv) to add, delete,
or amend any provisions to the extent necessary or desirable to comply with
any
requirements imposed by the Code and the REMIC Provisions. No such amendment
effected pursuant to the preceding sentence shall, as evidenced by an Opinion
of
Counsel, result in an Adverse REMIC Event, nor shall such amendment effected
pursuant to clause (iii) of such sentence adversely affect in any material
respect the interests of any Holder. Prior to entering into any amendment
without the consent of Holders pursuant to this paragraph, the Trustee shall
be
provided with an Opinion of Counsel (at the expense of the party requesting
such
amendment) to the effect that such amendment is permitted under this Section
10.03. Any such amendment shall be deemed not to adversely affect in any
material respect any Holder, if the Trustee receives written confirmation from
each Rating Agency that such amendment will not cause such Rating Agency to
reduce the then current rating assigned to the Certificates.
94
(b) This
Agreement may also be amended from time to time by the Depositor and the
Trustee, with the consent of the Holders of not less than 66-2/3% of the Class
Principal Balance or Percentage Interest 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; provided,
however,
that no
such amendment shall be made unless the Trustee receives an Opinion of Counsel,
at the expense of the party requesting the change, that such change will not
cause an Adverse REMIC Event; and provided further, that no such amendment may
(i) reduce in any manner the amount of, or delay the timing of, payments
received on Mortgage Loans which are required to be distributed on any
Certificate, without the consent of the Holder of such Certificate or (ii)
reduce the aforesaid percentages of Class Principal Balance or Percentage
Interest of Certificates of each Class, the Holders of which are required to
consent to any such amendment without the consent of the Holders of 100% of
the
Class Principal Balance or Percentage Interest of each Class of Certificates
affected thereby. For purposes of this paragraph, references to “Holder” or
“Holders” shall be deemed to include, in the case of any Class of Book-Entry
Certificates, the related Certificate Owners.
(c) Promptly
after the execution of any such amendment, the Trustee shall furnish written
notification of the substance of such amendment to each Holder, the Depositor
and the Rating Agencies.
(d) It
shall
not be necessary for the consent of Holders under this Section 10.03 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 Holders shall be subject to such reasonable regulations as the
Trustee may prescribe.
Section
10.04 Voting
Rights.
Except
to
the extent that the consent of all affected Certificateholders is required
pursuant to this Agreement, with respect to any provision of this Agreement
requiring the consent of Certificateholders representing specified percentages
of aggregate outstanding Certificate Balance or Percentage Interest,
Certificates owned by the Depositor, the Trustee, the Servicer or any Affiliates
thereof are not to be counted so long as such Certificates are owned by the
Depositor, the Trustee, the Servicer or any Affiliate thereof.
Section
10.05 Provision
of Information.
(a) For
so
long as any of the Certificates of any Class are “restricted securities” within
the meaning of Rule 144(a)(3) under the Securities Act, each of the
Depositor and the Trustee (upon instruction from the Depositor) agree to
cooperate with each other to provide to any Certificateholders and to any
prospective purchaser of Certificates designated by such holder, upon the
request of such holder or prospective purchaser, any information required to
be
provided to such holder or prospective purchaser to satisfy the condition set
forth in Rule 144A(d)(4) under the Securities Act. Any reasonable,
out-of-pocket expenses incurred by the Trustee in providing such information
shall be reimbursed by the Depositor.
(b) The
Trustee shall provide to any person to whom a Prospectus was delivered, upon
the
request of such person specifying the document or documents requested, a copy
(excluding exhibits) of any report on Form 8-K or Form 10-K filed with
the Securities and Exchange Commission pursuant to Section 6.14(b). Any
reasonable out-of-pocket expenses incurred by the Trustee in providing copies
of
such documents shall be reimbursed by the Depositor.
95
Section
10.06 Governing
Law.
THIS
AGREEMENT SHALL BE GOVERNED BY AND CONSTRUED IN ACCORDANCE WITH THE LAWS OF
THE
STATE OF NEW YORK, AND THE OBLIGATIONS, RIGHTS AND REMEDIES OF THE PARTIES
HEREUNDER SHALL BE DETERMINED IN ACCORDANCE WITH SUCH LAWS WITHOUT REGARD TO
CONFLICT OF LAWS PRINCIPLES APPLIED IN NEW YORK (OTHER THAN SECTION 5-1401
OF
THE NEW YORK GENERAL OBLIGATIONS LAW).
Section
10.07 Notices.
All
requests, demands, notices, authorizations, directions, consents, waivers and
communications hereunder shall be in writing and shall be deemed to have been
duly given when received by (a) in the case of the Depositor, Xxxxxx
Xxxxxxx Capital I Inc., 0000 Xxxxxxxx, Xxx Xxxx, Xxx Xxxx 00000, telephone
number (000) 000-0000, Attention: Xxxxxx Xxxxxxx Mortgage Loan Trust 2006-14SL,
(b) in the case of the Seller, Xxxxxx Xxxxxxx Mortgage Capital Inc., 0000
Xxxxxxxx, Xxx Xxxx, Xxx Xxxx 00000, telephone number (000) 000-0000, Attention:
Xxxxxx Xxxxxxx Mortgage Loan Trust 2006-14SL, (c) in the case of the
Trustee, LaSalle Bank National Association, 000 Xxxxx XxXxxxx Xxxxxx, Xxxxx
0000, Xxxxxxx, Xxxxxxxx 00000 Attention: Global Securities and Trust
Services/Xxxxxx Xxxxxxx Mortgage Loan Trust 2006-14SL, facsimile number (000)
000-0000 Attention: Global Securities and Trust Services/Xxxxxx Xxxxxxx Mortgage
Loan Trust 2006-14SL, (d) in the case of LaSalle Bank National Association,
as
Custodian, LaSalle Bank National Association, 000 Xxxxx XxXxxxx Xxxxxx, Xxxxx
0000, Xxxxxxx, Xxxxxxxx 00000 Attention: Global Securities and Trust
Services/Xxxxxx Xxxxxxx Mortgage Loan Trust 2006-14SL, facsimile number (000)
000-0000, Attention: Global Securities and Trust Services/Xxxxxx Xxxxxxx
Mortgage Loan Trust 2006-14SL and (e) in the case of the Rating Agencies, the
address specified therefor in the definition corresponding to the name of such
Rating Agency, or as to each party such other address as may hereafter be
furnished by such party to the other parties in writing. All demands, notices
and communications to a party hereunder shall be in writing and shall be deemed
to have been duly given when delivered to such party at the relevant address,
facsimile number or electronic mail address set forth above or at such other
address, facsimile number or electronic mail address as such party may designate
from time to time by written notice in accordance with this
Section 10.07.
Section
10.08 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.
96
Section
10.09 Indulgences;
No Waivers.
Neither
the failure nor any delay on the part of a party to exercise any right, remedy,
power or privilege under this Agreement shall operate as a waiver thereof,
nor
shall any single or partial exercise of any right, remedy, power or privilege
preclude any other or further exercise of the same or of any other right,
remedy, power or privilege, nor shall any waiver of any right, remedy, power
or
privilege with respect to any occurrence be construed as a waiver of such right,
remedy, power or privilege with respect to any other occurrence. No waiver
shall
be effective unless it is in writing and is signed by the party asserted to
have
granted such waiver.
Section
10.10 Headings
Not To Affect Interpretation.
The
headings contained in this Agreement are for convenience of reference only,
and
they shall not be used in the interpretation hereof.
Section
10.11 Benefits
of Agreement.
Nothing
in this Agreement or in the Certificates, express or implied, shall give to
any
Person, other than the parties to this Agreement and their successors hereunder
and the Holders of the Certificates, any benefit or any legal or equitable
right, power, remedy or claim under this Agreement, except to the extent
specified in Section 10.15.
Section
10.12 Special
Notices to the Rating Agencies.
(a) The
Depositor shall give prompt notice to the Rating Agencies of the occurrence
of
any of the following events of which it has notice:
(i) any
amendment to this Agreement pursuant to Section 10.03;
(ii) the
making of a final payment pursuant to Section 7.02; and
(iii) any
termination of the rights and obligations of the Servicer under the applicable
Servicing Agreement.
(b) All
notices to the Rating Agencies provided for this Section 10.12 shall be in
writing and sent by first class mail, telecopy or overnight courier, to the
address specified therefor in the definition corresponding to the name of such
Rating Agency.
(c) The
Trustee shall provide or make available to the Rating Agencies reports prepared
pursuant to Section 4.04. In addition, the Trustee shall, at the expense of
the Trust Fund, make available to each Rating Agency such information as such
Rating Agency may reasonably request regarding the Certificates or the Trust
Fund, to the extent that such information is reasonably available to the
Trustee.
(d) The
Depositor hereby represents to S&P that, to the Depositor’s knowledge, the
information provided to such Rating Agency, including the loan level detail,
is
true and correct according to such Rating Agency’s requirements.
97
Section
10.13 Conflicts.
To
the
extent that the terms of this Agreement conflict with the terms of any Purchase
Agreement or the Servicing Agreement, such Purchase Agreement or the Servicing
Agreement, as applicable, shall govern.
Section
10.14 Counterparts.
This
Agreement may be executed in one or more counterparts, each of which shall
be
deemed to be an original, and all of which together shall constitute one and
the
same instrument.
Section
10.15 No
Petitions.
The
Trustee, by entering into this Agreement, hereby covenants and agrees that
it
shall not at any time institute against the Depositor, or join in any
institution against the Depositor of, any bankruptcy, reorganization,
arrangement, insolvency or liquidation proceedings, or other proceedings under
any United States federal or state bankruptcy or similar law in connection
with
any obligations relating to this Agreement or any of the documents entered
into
by the Depositor in connection with the transactions contemplated by this
Agreement, except that the Trustee shall not be prohibited from filing a proof
of claim in any such proceeding.
Section
10.16 Indemnification
by Trust.
Pursuant
to the Purchase Agreements and the Servicing Agreement, each of the Originators
and the Servicer shall be indemnified by the Trust to the extent specified
in
the related Purchase Agreement or the Servicing Agreement, as
applicable.
Pursuant
to the Custodial Agreements, each of the Custodians shall be indemnified by
the
Trust to the extent specified in the related Custodial Agreement.
98
IN
WITNESS WHEREOF, the parties hereto have caused their names to be signed hereto
by their respective officers hereunto duly authorized as of the day and year
first above written.
XXXXXX
XXXXXXX CAPITAL I INC.,
as
Depositor
By:
/s/
Xxx Xxx
Name:
Xxx
Xxx
Title:
Vice President
LASALLE
BANK NATIONAL ASSOCIATION,
as
Trustee
By:
/s/
Xxxxx X Xxxx
Name:
Xxxxx X. Xxxx
Title:
Assistant Vice President
99
Solely
for purposes of Section 2.05
accepted
and agreed to by:
XXXXXX
XXXXXXX MORTGAGE CAPITAL INC.
By: ___/s/
Val Kay____________________
Name:
Xxx
Xxx
Title:
Vice President
100
EXHIBIT
A
FORMS
OF
CERTIFICATES
A-1
EXHIBIT
B
FORM
OF
RESIDUAL CERTIFICATE TRANSFER AFFIDAVIT (TRANSFEREE)
STATE
OF )
) ss.:
COUNTY
OF )
[NAME
OF
OFFICER], _________________ being first duly sworn, deposes and
says:
|
1.
|
That
he [she] is [title of officer] ________________________ of [name
of
Purchaser] _________________________________________ (the “Purchaser”),
a _______________________ [description of type of entity] duly organized
and existing under the laws of the [State of __________] [United
States],
on behalf of which he [she] makes this
affidavit.
|
|
2.
|
That
the Purchaser’s Taxpayer Identification Number is
[
].
|
|
3.
|
That
the Purchaser is not a “disqualified organization” within the meaning of
Section 860E(e)(5) of the Internal Revenue Code of 1986, as amended
(the “Code”)
and will not be a “disqualified organization” as of [date of transfer],
and that the Purchaser is not acquiring a Residual Certificate (as
defined
in the Agreement) for the account of, or as agent (including a broker,
nominee, or other middleman) for, any person or entity from which
it has
not received an affidavit substantially in the form of this affidavit.
For
these purposes, a “disqualified organization” means the United States, any
state or political subdivision thereof, any foreign government, any
international organization, any agency or instrumentality of any
of the
foregoing (other than an instrumentality if all of its activities
are
subject to tax and a majority of its board of directors is not selected
by
such governmental entity), any cooperative organization furnishing
electric energy or providing telephone service to persons in rural
areas
as described in Code Section 1381(a)(2)(C), any “electing large
partnership” within the meaning of Section 775 of the Code, or any
organization (other than a farmers’ cooperative described in Code
Section 521) that is exempt from federal income tax unless such
organization is subject to the tax on unrelated business income imposed
by
Code Section 511.
|
|
4.
|
That
the Purchaser either (x) is not, and on __________________ [date of
transfer] will not be, an employee benefit plan or other plan or
arrangement subject to Section 406 of the Employee Retirement Income
Security Act of 1974, as amended (“ERISA”),
or Section 4975 of the Code (“Code”),
(collectively, a “Plan”)
or a person acting on behalf of any such Plan or investing the assets
of
any such Plan to acquire a Residual Certificate; (y) is an insurance
company that is purchasing the Certificate with funds contained in
an
“insurance company general account” as defined in Section V(e) of
Prohibited Transaction Class Exemption (“PTCE”)
95-60 and the purchase and holding of the Certificate satisfy the
requirements for exemptive relief under Sections I and III of PTCE
95-60;
or (z) herewith delivers to the Certificate Registrar an opinion of
counsel satisfactory to the Certificate Registrar and the Trustee
and upon
which the Certificate Registrar, the Trustee and the Depositor shall
be
entitled to rely, to the effect that the purchase or holding of such
Residual Certificate by the Purchaser will not result in any non-exempt
prohibited transactions under Title I of ERISA or Section 4975
of the Code and will not subject the Certificate Registrar, the Trustee
or
the Depositor to any obligation in addition to those undertaken by
such
entities in the Trust Agreement, which opinion of counsel shall not
be an
expense of the Trust Fund or any of the above
parties.
|
B-1
|
5.
|
That
the Purchaser hereby acknowledges that under the terms of the Trust
Agreement dated as of October 1, 2006 (the “Agreement”),
between Xxxxxx Xxxxxxx Capital I Inc., as Depositor, and LaSalle
Bank
National Association, as Trustee, with respect to Xxxxxx Xxxxxxx
Mortgage
Loan Trust 2006-14SL, Mortgage Pass-Through Certificates, no transfer
of
the Residual Certificates shall be permitted to be made to any person
unless the Certificate Registrar has received a certificate from
such
transferee containing the representations in paragraphs 3 and 4
hereof.
|
|
6.
|
That
the Purchaser does not hold REMIC residual securities as nominee
to
facilitate the clearance and settlement of such securities through
electronic book-entry changes in accounts of participating organizations
(such entity, a “Book-Entry
Nominee”).
|
|
7.
|
That
the Purchaser does not have the intention to impede the assessment
or
collection of any federal, state or local taxes legally required
to be
paid with respect to such Residual
Certificate.
|
|
8.
|
That
the Purchaser will not transfer a Residual Certificate to any person
or
entity (i) as to which the Purchaser has actual knowledge that the
requirements set forth in paragraph 3, paragraph 6 or
paragraph 10 hereof are not satisfied or that the Purchaser has
reason to believe does not satisfy the requirements set forth in
paragraph 7 hereof, and (ii) without obtaining from the
prospective Purchaser an affidavit substantially in this form and
providing to the Certificate Registrar a written statement substantially
in the form of Exhibit C to the
Agreement.
|
|
9.
|
That
the Purchaser understands that, as the holder of a Residual Certificate,
the Purchaser may incur tax liabilities in excess of any cash flows
generated by the interest and that it intends to pay taxes associated
with
holding such Residual Certificate as they become
due.
|
|
10.
|
That
the Purchaser (i) is not a Non-U.S. Person or (ii) is a Non-U.S.
Person that holds a Residual Certificate in connection with the conduct
of
a trade or business within the United States and has furnished the
transferor the Certificate Registrar with an effective Internal Revenue
Service Form W-8ECI (Certificate of Foreign Person’s Claim for
Exemption From Withholding on Income Effectively Connected With the
Conduct of a Trade or Business in the United States) or successor
form at
the time and in the manner required by the Code or (iii) is a
Non-U.S. Person that has delivered to the transferor, the Trustee
and the
Certificate Registrar an opinion of a nationally recognized tax counsel
to
the effect that the transfer of such Residual Certificate to it is
in
accordance with the requirements of the Code and the regulations
promulgated thereunder and that such transfer of a Residual Certificate
will not be disregarded for federal income tax purposes. “Non-U.S.
Person”
means an individual, corporation, partnership or other person other
than
(i) a citizen or resident of the United States; (ii) a
corporation, partnership or other entity created or organized in
or under
the laws of the United States or any state thereof, including for
this
purpose, the District of Columbia; (iii) an estate that is subject to
U.S. federal income tax regardless of the source of its income;
(iv) a trust if a court within the United States is able to exercise
primary supervision over the administration of the trust and one
or more
United States trustees have authority to control all substantial
decisions
of the trust; and, (v) to the extent provided in Treasury
regulations, certain trusts in existence on August 20, 1996 that
are
treated as United States persons prior to such date and elect to
continue
to be treated as United States
persons.
|
B-2
|
11.
|
The
Purchaser will not cause income from the Residual Certificate to
be
attributable to a foreign permanent establishment or fixed base of
the
Purchaser or another U.S. taxpayer.
|
|
12.
|
That
the Purchaser agrees to such amendments of the Trust Agreement as
may be
required to further effectuate the restrictions on transfer of any
Residual Certificate to such a “disqualified organization,” an agent
thereof, a Book-Entry Nominee, or a person that does not satisfy
the
requirements of paragraph 7 and paragraph 10
hereof.
|
|
13.
|
That
the Purchaser consents to the designation of the Trustee to act as
agent
for the “tax matters person” of each REMIC created by the Trust Fund
pursuant to the Trust Agreement.
|
B-3
IN
WITNESS WHEREOF, the Purchaser has caused this instrument to be executed on
its
behalf, pursuant to authority of its Board of Directors, by its [title of
officer] this _____ day of __________ 20__.
_________________________________
[name
of
Purchaser]
By:
Name:
Title:
Personally
appeared before me the above-named [name of officer] ________________, known
or
proved to me to be the same person who executed the foregoing instrument and
to
be the [title of officer] _________________ of the Purchaser, and acknowledged
to me that he [she] executed the same as his [her] free act and deed and the
free act and deed of the Purchaser.
Subscribed
and sworn before me this _____ day of __________ 20__.
NOTARY
PUBLIC
______________________________________
COUNTY
OF
_________________________________
STATE
OF
___________________________________
My
commission expires the _____ day of __________ 20__.
B-4
EXHIBIT
C
FORM
OF
RESIDUAL CERTIFICATE TRANSFER AFFIDAVIT (TRANSFEROR)
____________________________
Date
|
Re:
|
Xxxxxx
Xxxxxxx Mortgage Loan Trust
2006-14SL
|
Mortgage
Pass-Through Certificates
_______________________
(the “Transferor”)
has
reviewed the attached affidavit of _____________________________ (the
“Transferee”),
and
has no actual knowledge that such affidavit is not true and has no reason to
believe that the information contained in paragraph 7 thereof is not true,
and has no reason to believe that the Transferee has the intention to impede
the
assessment or collection of any federal, state or local taxes legally required
to be paid with respect to a Residual Certificate. In addition, the Transferor
has conducted a reasonable investigation at the time of the transfer and found
that the Transferee had historically paid its debts as they came due and found
no significant evidence to indicate that the Transferee will not continue to
pay
its debts as they become due.
Very
truly yours,
______________________________
Name:
Title:
C-1
EXHIBIT
D
[RESERVED]
D-1
EXHIBIT
E
LIST
OF
PURCHASE AGREEMENTS AND SERVICING AGREEMENTS
1. Third
Amended and Restated Mortgage Loan Purchase and Warranties Agreement dated
as of
March 1, 2006 between Xxxxxx Xxxxxxx Mortgage Capital Inc., as purchaser, and
Aames Capital Corporation, as seller;
2.
Seller
Agreement dated as of July 28, 2004 (together with the Seller’s Guide and any
and all of the other documents and agreements incorporated by reference therein)
by and between Xxxxxx Xxxxxxx Mortgage Capital Inc., as purchaser, and Aegis
Mortgage Corporation, as seller, as supplemented by the Flow Addendum to Seller
Agreement dated as of April 6, 2005 by and between Xxxxxx Xxxxxxx Mortgage
Capital Inc., as purchaser, and Aegis Mortgage Corporation, as seller;
and
3. Fourth
Amended and Restated Mortgage Loan Purchase and Warranties Agreement dated
as of
May 1, 2006 between Xxxxxx Xxxxxxx Mortgage Capital Inc., as purchaser, and
Decision One Mortgage Company, LLC, as seller;
4. Servicing
Agreement dated as of October 1, 2006 between Xxxxxx Xxxxxxx Mortgage Capital
Inc., as owner, and GMAC Mortgage Corporation, as servicer.
E-1
EXHIBIT
F
LIST
OF
CUSTODIAL AGREEMENTS
1. Custodial
Agreement dated as of October 1, 2006 among Xxxxxx Xxxxxxx Capital I Inc.,
as
purchaser, Aames Capital Corporation, as a Seller, Aegis Mortgage Corporation,
as a Seller, Decision One Mortgage Company, LLC, as, a Seller, LaSalle Bank
National Association, as Truste and LaSalle Bank National Association, as
Custodian.
F-1
EXHIBIT
G
[RESERVED]
G-1
EXHIBIT
H
FORM
OF
RULE 144A TRANSFER CERTIFICATE
|
Re:
|
Xxxxxx
Xxxxxxx Mortgage Loan Trust 2006-14SL,
Mortgage Pass-Through Certificates |
Reference
is hereby made to the Trust Agreement dated as of October 1, 2006 (the
“Trust
Agreement”),
between Xxxxxx Xxxxxxx Capital I Inc., as Depositor, and LaSalle Bank National
Association, as Trustee. Capitalized terms used but not defined herein shall
have the meanings given to them in the Trust Agreement.
This
letter relates to $__________ initial Certificate Balance of Class _____
Certificates which are held in the form of Definitive Certificates registered
in
the name of ______________ (the “Transferor”).
The
Transferor has requested a transfer of such Definitive Certificates for
Definitive Certificates of such Class registered in the name of [insert name
of
transferee].
In
connection with such request, and in respect of such Certificates, the
Transferor hereby certifies that such Certificates are being transferred in
accordance with (i) the transfer restrictions set forth in the Trust
Agreement and the Certificates and (ii) Rule 144A under the Securities
Act to a purchaser that the Transferor reasonably believes is a “qualified
institutional buyer” within the meaning of Rule 144A purchasing for its own
account or for the account of a “qualified institutional buyer,” which purchaser
is aware that the sale to it is being made in reliance upon Rule 144A, in a
transaction meeting the requirements of Rule 144A and in accordance with
any applicable securities laws of any state of the United States or any other
applicable jurisdiction.
This
certificate and the statements contained herein are made for your benefit and
the benefit of the Underwriter, the Certificate Registrar and the
Depositor.
_________________________________
[Name
of
Transferor]
By:___________________________________
Name:
Title:
Dated:
___________, ____
H-1
EXHIBIT
I
FORM
OF
PURCHASER’S LETTER FOR
INSTITUTIONAL
ACCREDITED INVESTOR
Date
Dear
Sirs:
In
connection with our proposed purchase of $______________ principal amount of
Xxxxxx Xxxxxxx Mortgage Loan Trust 2006-14SL, Mortgage Pass-Through Certificates
(the “Privately
Offered Certificates”)
of
Xxxxxx Xxxxxxx Capital I Inc. (the “Depositor”),
we
confirm that:
|
(1)
|
We
understand that the Privately Offered Certificates have not been,
and will
not be, registered under the Securities Act of 1933, as amended (the
“Securities
Act”),
and may not be sold except as permitted in the following sentence.
We
agree, on our own behalf and on behalf of any accounts for which
we are
acting as hereinafter stated, that if we should sell any Privately
Offered
Certificates within two years of the later of the date of original
issuance of the Privately Offered Certificates or the last day on
which
such Privately Offered Certificates are owned by the Depositor or
any
affiliate of the Depositor we will do so only (A) to the Depositor,
(B) to “qualified institutional buyers” (within the meaning of
Rule 144A under the Securities Act) in accordance with Rule 144A
under the Securities Act (“QIBs”),
(C) pursuant to the exemption from registration provided by
Rule 144 under the Securities Act, or (D) to an institutional
“accredited investor” within the meaning of Rule 501(a)(1), (2), (3)
or (7) of Regulation D under the Securities Act that is not a QIB (an
“Institutional
Accredited Investor”)
which, prior to such transfer, delivers to the Certificate Registrar
under
the Trust Agreement dated as of October 1, 2006 (the “Trust
Agreement”),
between Xxxxxx Xxxxxxx Capital I Inc., as Depositor, and LaSalle
Bank
National Association, as Trustee, a signed letter in the form of
this
letter; and we further agree, in the capacities stated above, to
provide
to any person purchasing any of the Privately Offered Certificates
from us
a notice advising such purchaser that resales of the Privately Offered
Certificates are restricted as stated
herein.
|
|
(2)
|
We
understand that, in connection with any proposed resale of any Privately
Offered Certificates to an Institutional Accredited Investor, we
will be
required to furnish to the Certificate Registrar a certification
from such
transferee in the form hereof to confirm that the proposed sale is
being
made pursuant to an exemption from, or in a transaction not subject
to,
the registration requirements of the Securities Act. We further understand
that the Privately Offered Certificates purchased by us will bear
a legend
to the foregoing effect.
|
I-1
|
(3)
|
We
are acquiring the Privately Offered Certificates for investment purposes
and not with a view to, or for offer or sale in connection with,
any
distribution in violation of the Securities Act. We have such knowledge
and experience in financial and business matters as to be capable
of
evaluating the merits and risks of our investment in the Privately
Offered
Certificates, and we and any account for which we are acting are
each able
to bear the economic risk of such
investment.
|
|
(4)
|
We
are an Institutional Accredited Investor and we are acquiring the
Privately Offered Certificates purchased by us for our own account
or for
one or more accounts (each of which is an Institutional Accredited
Investor) as to each of which we exercise sole investment
discretion.
|
|
(5)
|
We
have received such information as we deem necessary in order to make
our
investment decision.
|
|
(6)
|
If
we are acquiring ERISA-Restricted Certificates, we understand that
in
accordance with ERISA, the Code and the Exemption, no Plan and no
person
acting on behalf of such a Plan may acquire such Certificate except
in
accordance with Section 3.03(d) of the Trust
Agreement.
|
Terms
used in this letter which are not otherwise defined herein have the respective
meanings assigned thereto in the Trust Agreement.
I-2
You
and
the Certificate Registrar are entitled to rely upon this letter and are
irrevocably authorized to produce this letter or a copy hereof to any interested
party in any administrative or legal proceeding or official inquiry with respect
to the matters covered hereby.
Very
truly yours,
___________________________________
[Purchaser]
By:______________________________________
Name:
Title:
I-3
EXHIBIT
J
FORM
OF
ERISA TRANSFER AFFIDAVIT
STATE
OF
NEW YORK )
) ss.:
COUNTY
OF
NEW YORK )
The
undersigned, being first duly sworn, deposes and says as follows:
1. The
undersigned is the ______________________ of ______________ (the “Investor”),
a
[corporation duly organized] and existing under the laws of __________, on
behalf of which he makes this affidavit.
2. The
Investor either (x) is not, and on ___________ [date of transfer] will not
be, an employee benefit plan or other plan or arrangement subject to
Section 406 of the Employee Retirement Income Security Act of 1974, as
amended (“ERISA”),
or
Section 4975 of the Internal Revenue Code of 1986, as amended (the
“Code”),
(collectively, a “Plan”)
or a
person acting on behalf of any such Plan or investing the assets of any such
Plan; (y) if the Certificate has been the subject of an ERISA-Qualifying
Underwriting, is an insurance company that is purchasing the Certificate with
funds contained in an “insurance company general account” as defined in
Section V(e) of Prohibited Transaction Class Exemption (“PTCE”)
95-60
and the purchase and holding of the Certificate satisfy the requirements for
exemptive relief under Sections I and III of PTCE 95-60; or (z) herewith
delivers to the Certificate Registrar an opinion of counsel satisfactory to
the
Certificate Registrar and the Trustee and upon which the Certificate Registrar,
the Trustee and the Depositor shall be entitled to rely, to the effect that
the
purchase and holding of such Certificate by the Investor will not constitute
or
result in any non-exempt prohibited transactions under Title I of ERISA or
Section 4975 of the Code and will not subject the Certificate Registrar,
the Trustee or the Depositor to any obligation in addition to those undertaken
by such entities in the Trust Agreement, which opinion of counsel shall not
be
an expense of the Trust Fund or the above parties.
3. The
Investor hereby acknowledges that under the terms of the Trust Agreement dated
as of October 1, 2006 (the “Trust
Agreement”),
between Xxxxxx Xxxxxxx Capital I Inc., as Depositor, and LaSalle Bank National
Association, as Trustee, no transfer of the ERISA-Restricted Certificates shall
be permitted to be made to any person unless the Certificate Registrar has
received a certificate from such transferee in the form hereof.
J-1
IN
WITNESS WHEREOF, the Investor has caused this instrument to be executed on
its
behalf, pursuant to proper authority, by its duly authorized officer, duly
attested, this ____ day of _______________ 20___.
________________________________
[Investor]
By:___________________________________
Name:
Title:
ATTEST:
_____________________________________
STATE
OF )
) ss.:
COUNTY
OF
)
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 Investor, and acknowledged that he executed the
same
as his free act and deed and the free act and deed of the Investor.
Subscribed
and sworn before me this _____ day of _________ 20___.
___________________________
NOTARY
PUBLIC
My
commission expires the
_____
day
of __________ 20___.
J-2
EXHIBIT
K
FORM
OF
LETTER OF REPRESENTATIONS
WITH
THE
DEPOSITORY TRUST COMPANY
[On
File
with the Trustee]
K-1
EXHIBIT
L
FORM
OF
CERTIFICATION TO BE
PROVIDED
WITH FORM 10-K
|
Re:
|
Xxxxxx
Xxxxxxx Mortgage Loan Trust 2006-14SL (the “Trust”),
Mortgage Pass-Through Certificates, Series 2006-14SL, issued pursuant
to
the Trust Agreement dated as of October 1, 2006 (the “Trust
Agreement”),
between Xxxxxx Xxxxxxx Capital I Inc., as depositor, and LaSalle
Bank
National Association, as trustee (the “Trustee”).
|
I,
[identify the certifying individual], certify that:
1. I
have
reviewed this annual report on Form 10-K (the “Annual
Report”),
and
all reports on Form 8-K containing distribution reports (collectively with
this
Annual Report, the “Reports”)
filed
in respect of periods included in the year covered by this Annual Report, of
the
Trust;
2. Based
on
my knowledge, the information in the Reports, 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 light of the circumstances under
which
such statements were made, not misleading as of the last day of the period
covered by this Annual Report;
3. Based
on
my knowledge, the distribution or servicing information required to be provided
to the Trustee by the Servicer under the Trust Agreement, for inclusion in
the
Reports is included in the Reports;
4. Based
on
my knowledge and upon the annual compliance statement included in this Annual
Report and required to be delivered to the Trustee in accordance with the terms
of the Trust Agreement, and except as disclosed in the Reports, the Servicer
has
fulfilled its obligations under the Trust Agreement; and
5. The
Reports disclose all significant deficiencies relating to the Servicer’s
compliance with the minimum servicing standards based upon the report provided
by an independent public accountant, after conducting a review in compliance
with the Uniform Single Attestation Program for Mortgage Bankers or similar
procedure, as set forth in the Trust Agreement, that is included in the
Reports.
In
giving
the certifications above, I have reasonably relied on information provided
to me
by the following unaffiliated parties: the Trustee and the
Servicer.
Date:_______________________________
_____________________________________
[Signature]
[Title]
L-1
EXHIBIT
M
FORM
OF
CERTIFICATION
TO
BE
PROVIDED BY THE TRUSTEE TO THE DEPOSITOR
|
Re:
|
Xxxxxx
Xxxxxxx Capital I Inc. Trust 2006-14SL (the “Trust”),
Mortgage Pass-Through Certificates, Series 2006-14SL, issued pursuant
to
the Trust Agreement dated as October 1, 2006 (the “Trust
Agreement”),
between Xxxxxx Xxxxxxx Capital I Inc., as depositor (the “Depositor”),
and LaSalle Bank National Association, as trustee (the “Trustee”)
|
________________________________________________________________________
I,
[identify the certifying individual], certify to the Depositor, and its
officers, directors and affiliates, and with the knowledge and intent that
they
will rely upon this certification, that:
1. I
have
reviewed the annual report on Form 10-K for the fiscal year [___] (the
“Annual
Report”),
and
all reports on Form 10-D required to be filed in respect of the period covered
by the Annual Report (collectively with the Annual Report, the “Reports”),
of
the Trust;
2. To
the
best of my knowledge, the information in the Reports, 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 light of the circumstances under
which
such statements were made, not misleading as of the last day of the period
covered by the Annual Report; and
3. To
the
best of my knowledge, and assuming the accuracy of information and statements
required to be made or delivered by the Servicer, Custodian and the Depositor,
the distribution information required to be provided by the Trustee under the
Trust Agreement and the servicing information required to be provided by the
Servicer under the Servicing Agreement for inclusion in the Reports is included
in the Reports.
Date:_______________________________
LASALLE
BANK NATIONAL ASSOCIATION
_____________________________________
[Signature]
[Title]
M-1
EXHIBIT
N
SERVICING
CRITERIA TO BE ADDRESSED IN ASSESSMENT OF COMPLIANCE
The
assessment of compliance to be delivered by the Servicer, Trustee and the
Custodian shall address, at a minimum, the criteria identified below
“Applicable
Servicing Criteria”:
|
SERVICING
CRITERIA
|
APPLICABLE
SERVICING
CRITERIA
|
|
|
Reference
|
Criteria
|
|
|
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.
|
Trustee/Servicer
|
|
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.
|
Trustee/Servicer
(as applicable to such party)
|
|
1122(d)(1)(iii)
|
Any
requirements in the transaction agreements to maintain a back-up
servicer
for the mortgage loans are maintained.
|
N/A
|
|
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.
|
Servicer
|
|
Cash
Collection and Administration
|
||
|
1122(d)(2)(i)
|
Payments
on mortgage loans 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.
|
Servicer
|
|
1122(d)(2)(ii)
|
Disbursements
made via wire transfer on behalf of an obligor or to an investor
are made
only by authorized personnel.
|
Servicer/Trustee
|
|
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.
|
Servicer
|
|
1122(d)(2)(iv)
|
The
related accounts for the transaction, such as cash reserve accounts
or
accounts established as a form of overcollateralization, are separately
maintained (e.g., with respect to commingling of cash) as set forth
in the
transaction agreements.
|
Servicer/Trustee
|
|
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.
|
Servicer
|
|
1122(d)(2)(vi)
|
Unissued
checks are safeguarded so as to prevent unauthorized
access.
|
Servicer/Trustee
|
|
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.
|
Servicer/Trustee
|
N-1
|
SERVICING
CRITERIA
|
APPLICABLE
SERVICING
CRITERIA
|
|
|
Reference
|
Criteria
|
|
|
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
the investors’ or the trustee’s records as to the total unpaid principal
balance and number of mortgage loans serviced by the
Servicer.
|
Trustee/Servicer
|
|
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.
|
Trustee/Servicer
|
|
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.
|
Trustee/Servicer
|
|
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.
|
Trustee/Servicer
|
|
Pool
Asset Administration
|
||
|
1122(d)(4)(i)
|
Collateral
or security on mortgage loans is maintained as required by the transaction
agreements or related mortgage loan documents.
|
Custodian/
Servicer
|
|
1122(d)(4)(ii)
|
Mortgage
loan and related documents are safeguarded as required by the transaction
agreements.
|
Custodian/Servicer
|
|
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.
|
Trustee/Servicer
|
|
1122(d)(4)(iv)
|
Payments
on mortgage loans, including any payoffs, made in accordance with
the
related mortgage loan 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 mortgage loan documents.
|
Servicer
|
|
1122(d)(4)(v)
|
The
Servicer’s records regarding the mortgage loans agree with the Servicer’s
records with respect to an obligor’s unpaid principal
balance.
|
Servicer
|
|
1122(d)(4)(vi)
|
Changes
with respect to the terms or status of an obligor’s mortgage loans (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.
|
Servicer
|
|
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.
|
Servicer
|
|
1122(d)(4)(viii)
|
Records
documenting collection efforts are maintained during the period a
mortgage
loan 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 mortgage loans including, for
example,
phone calls, letters and payment rescheduling plans in cases where
delinquency is deemed temporary (e.g., illness or
unemployment).
|
Servicer
|
|
1122(d)(4)(ix)
|
Adjustments
to interest rates or rates of return for mortgage loans with variable
rates are computed based on the related mortgage loan
documents.
|
Servicer
|
N-2
|
SERVICING
CRITERIA
|
APPLICABLE
SERVICING
CRITERIA
|
|
|
Reference
|
Criteria
|
|
|
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 mortgage loan
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 mortgage loan
documents and state laws; and (C) such funds are returned to the
obligor
within 30 calendar days of full repayment of the related mortgage
loans,
or such other number of days specified in the transaction
agreements.
|
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.
|
Servicer
|
|
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.
|
Servicer
|
|
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.
|
Servicer
|
|
1122(d)(4)(xiv)
|
Delinquencies,
charge-offs and uncollectible accounts are recognized and recorded
in
accordance with the transaction agreements.
|
Servicer
|
|
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.
|
Trustee
|
N-3
EXHIBIT
O
ADDITIONAL
FORM 10-D DISCLOSURE
|
Item
on Form 10-D
|
Party
Responsible
|
|
Item
1: Distribution and Pool Performance
Information
Any
information required by Item 1121 of
Regulation
AB which is NOT included
on
the Monthly Statement
|
Servicer
Trustee
|
|
Item
2: Legal Proceedings
per
Item 1117 of Regulation AB
|
(i)
All parties to the Agreement (as to themselves), (ii) the Trustee
and
Servicer as to the issuing entity, (iii) the Depositor as to the
sponsor,
and each Originator or any Regulation AB Item 1100(d)(1)
party
|
|
Item
3: Sale of Securities and Use of Proceeds
|
Depositor
|
|
Item
4: Defaults Upon Senior Securities
|
Trustee
|
|
Item
5: Submission of Matters to a Vote of Security Holders
|
Depositor
or the party to this Agreement submitting such matter to a vote of
Certificateholders
|
|
Item
6: Significant Obligors of Pool Assets
|
N/A
|
|
Item
7: Significant Enhancement Provider Information
|
Depositor
|
|
Item
8: Other Information
|
Any
party to the Agreement responsible for disclosure items on Form
8-K
|
|
Item
9: Exhibits
|
Trustee/Depositor
|
O-1
EXHIBIT
P
ADDITIONAL
FORM 10-K DISCLOSURE
|
Item
on Form 10-K
|
Party
Responsible
|
|
Item
9B: Other Information
|
Any
party to the Agreement responsible for disclosure items on Form
8-K
|
|
Item
15: Exhibits, Financial Statement Schedules
|
Depositor,
Servicer and Trustee (as
applicable)
|
|
Additional
Item:
Disclosure
per Item 1117 of
Regulation
AB
|
(i)
All parties to the Agreement (as to themselves), (ii) the Trustee,
Depositor and Servicer as to the Trust, (iii) the Depositor as to
the
sponsor and each Originator or any 1100(d)(1) party
|
|
Additional
Item:
Disclosure
per Item 1119 of
Regulation
AB
|
(i)
All parties to the Agreement (as to themselves), (ii) the Depositor
as to
the sponsor
|
|
Additional
Item:
Disclosure
per Item 1112(b) of
Regulation
AB
|
N/A
|
|
Additional
Item:
Disclosure
per Items 1114(b) and
1115(b)
of Regulation AB
|
Depositor
|
P-1
EXHIBIT
Q
FORM
8-K
DISCLOSURE INFORMATION
|
Item
on Form 8-K
|
Party
Responsible
|
|
Item
1.01- Entry into a Material Definitive Agreement
|
The
party to this Agreement entering into such material definitive
agreement
|
|
Item
1.02- Termination of a Material Definitive Agreement
|
The
party to this Agreement requesting termination of a material definitive
agreement
|
|
Item
1.03- Bankruptcy or Receivership
|
(i)
All parties to the Agreement (as to themselves), (ii) the Trustee
and
Servicer as to the Trust, (iii) the Depositor as to the sponsor and
each
Originator or any 1100(d)(1) party
|
|
Item
2.04- Triggering Events that Accelerate or Increase a Direct Financial
Obligation or an Obligation under an Off-Balance Sheet
Arrangement
|
Depositor
|
|
Item
3.03- Material Modification to Rights of Security Holders
|
The
party requesting such modification
|
|
Item
5.03- Amendments of Articles of Incorporation or Bylaws; Change of
Fiscal
Year
|
Depositor
|
|
Item
6.01- ABS Informational and Computational Material
|
Depositor
|
|
Item
6.02- Change of Servicer or Trustee
|
Servicer,
Trustee, successor servicer, successor trustee
|
|
Item
6.03- Change in Credit Enhancement or External Support
|
Depositor
|
|
Item
6.04- Failure to Make a Required Distribution
|
Trustee
|
|
Item
6.05- Securities Act Updating Disclosure
|
Depositor
|
|
Item
7.01- Regulation FD Disclosure
|
Depositor
|
|
Item
8.01
|
Xxxxxxxxx
|
X-0
