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ACE SECURITIES CORP.
Depositor
▇▇▇▇▇ FARGO BANK, N.A.
a Servicer
▇▇▇▇▇ FARGO BANK, N.A.
Master Servicer and Securities Administrator
HSBC BANK USA, NATIONAL ASSOCIATION
Trustee
POOLING AND SERVICING AGREEMENT
Dated as of November 1, 2005
ACE Securities Corp. Home Equity Loan Trust, Series 2005-HE7
Asset Backed Pass-Through Certificates
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TABLE OF CONTENTS
ARTICLE I DEFINITIONS..................................................................................
SECTION 1.01. Defined Terms.......................................................................
SECTION 1.02. Allocation of Certain Interest Shortfalls...........................................
ARTICLE II CONVEYANCE OF MORTGAGE LOANS; ORIGINAL ISSUANCE OF CERTIFICATES..............................
SECTION 2.01. Conveyance of the Mortgage Loans....................................................
SECTION 2.02. Acceptance of REMIC I by Trustee....................................................
SECTION 2.03. Repurchase or Substitution of Mortgage Loans........................................
SECTION 2.04. Representations and Warranties of the Master Servicer...............................
SECTION 2.05. Representations, Warranties and Covenants of each Servicer..........................
SECTION 2.06. Issuance of the REMIC I Regular Interests and the Class R-I Interest................
SECTION 2.07. Conveyance of the REMIC I Regular Interests; Acceptance of REMIC II and REMIC
III by the Trustee..................................................................
SECTION 2.08. Issuance of Residual Certificates...................................................
SECTION 2.09. Establishment of the Trust..........................................................
ARTICLE III ADMINISTRATION AND SERVICING OF THE MORTGAGE LOANS; ACCOUNTS.................................
SECTION 3.01. The Servicers to Act as Servicers...................................................
SECTION 3.02. Sub-Servicing Agreements Between a Servicer and Sub-Servicers.......................
SECTION 3.03. Successor Sub-Servicers.............................................................
SECTION 3.04. No Contractual Relationship Between Sub-Servicer, Trustee or the
Certificateholders..................................................................
SECTION 3.05. Assumption or Termination of Sub-Servicing Agreement by Successor Servicer..........
SECTION 3.06. Collection of Certain Mortgage Loan Payments........................................
SECTION 3.07. Collection of Taxes, Assessments and Similar Items; Servicing Accounts..............
SECTION 3.08. Collection Accounts and Distribution Account........................................
SECTION 3.09. Withdrawals from the Collection Accounts and Distribution Account...................
SECTION 3.10. Investment of Funds in the Investment Accounts......................................
SECTION 3.11. Maintenance of Hazard Insurance, Errors and Omissions and Fidelity Coverage and
Primary Mortgage Insurance..........................................................
SECTION 3.12. Enforcement of Due-on-Sale Clauses; Assumption Agreements...........................
SECTION 3.13. Realization Upon Defaulted Mortgage Loans...........................................
SECTION 3.14. Trustee to Cooperate; Release of Mortgage Files.....................................
SECTION 3.15. Servicing Compensation..............................................................
SECTION 3.16. Collection Account Statements.......................................................
SECTION 3.17. Statement as to Compliance..........................................................
SECTION 3.18. Independent Public Accountants' Servicing Report....................................
SECTION 3.19. Annual Certification................................................................
SECTION 3.20. Access to Certain Documentation.....................................................
SECTION 3.21. Title, Management and Disposition of REO Property...................................
SECTION 3.22. Obligations of the Servicers in Respect of Prepayment Interest Shortfalls;
Relief Act Interest Shortfalls......................................................
SECTION 3.23. Obligations of the Servicers in Respect of Mortgage Rates and Monthly Payments......
SECTION 3.24. Reserve Fund........................................................................
SECTION 3.25. Advance Facility....................................................................
SECTION 3.26. The Servicers Indemnification.......................................................
ARTICLE IV ADMINISTRATION AND MASTER SERVICING OF THE MORTGAGE LOANS BY THE MASTER SERVICER.............
SECTION 4.01. Master Servicer.....................................................................
SECTION 4.02. REMIC-Related Covenants.............................................................
SECTION 4.03. Monitoring of Servicers.............................................................
SECTION 4.04. Fidelity Bond.......................................................................
SECTION 4.05. Power to Act; Procedures............................................................
SECTION 4.06. Due-on-Sale Clauses; Assumption Agreements..........................................
SECTION 4.07. Documents, Records and Funds in Possession of Master Servicer To Be Held for
Trustee.............................................................................
SECTION 4.08. Standard Hazard Insurance and Flood Insurance Policies..............................
SECTION 4.09. Presentment of Claims and Collection of Proceeds....................................
SECTION 4.10. Maintenance of Primary Mortgage Insurance Policies..................................
SECTION 4.11. Trustee to Retain Possession of Certain Insurance Policies and Documents............
SECTION 4.12. Reserved............................................................................
SECTION 4.13. Compensation for the Master Servicer................................................
SECTION 4.14. REO Property........................................................................
SECTION 4.15. Annual Officer's Certificate as to Compliance.......................................
SECTION 4.16. Annual Independent Accountant's Servicing Report....................................
SECTION 4.17. Reserved............................................................................
SECTION 4.18. Obligation of the Master Servicer in Respect of Prepayment Interest Shortfalls......
SECTION 4.19. Prepayment Penalty Verification.....................................................
ARTICLE V PAYMENTS TO CERTIFICATEHOLDERS...............................................................
SECTION 5.01. Distributions.......................................................................
SECTION 5.02. Statements to Certificateholders....................................................
SECTION 5.03. Servicer Reports; P&I Advances......................................................
SECTION 5.04. Allocation of Realized Losses.......................................................
SECTION 5.05. Compliance with Withholding Requirements............................................
SECTION 5.06. Reports Filed with Securities and Exchange Commission...............................
SECTION 5.07. Supplemental Interest Trust.........................................................
SECTION 5.08. Tax Treatment of Swap Payments and Swap Termination Payments........................
ARTICLE VI THE CERTIFICATES.............................................................................
SECTION 6.01. The Certificates....................................................................
SECTION 6.02. Registration of Transfer and Exchange of Certificates...............................
SECTION 6.03. Mutilated, Destroyed, Lost or Stolen Certificates...................................
SECTION 6.04. Persons Deemed Owners...............................................................
SECTION 6.05. Certain Available Information.......................................................
ARTICLE VII THE DEPOSITOR, THE SERVICERS AND THE MASTER SERVICER.........................................
SECTION 7.01. Liability of the Depositor, the Servicers and the Master Servicer...................
SECTION 7.02. Merger or Consolidation of the Depositor, the Servicers or the Master Servicer......
SECTION 7.03. Limitation on Liability of the Depositor, the Servicers, the Master Servicer and
Others..............................................................................
SECTION 7.04. Limitation on Resignation of the Servicers..........................................
SECTION 7.05. Limitation on Resignation of the Master Servicer....................................
SECTION 7.06. Assignment of Master Servicing......................................................
SECTION 7.07. Rights of the Depositor in Respect of the Servicers and the Master Servicer.........
SECTION 7.08. Duties of the Credit Risk Manager...................................................
SECTION 7.09. Limitation Upon Liability of the Credit Risk Manager................................
SECTION 7.10. Removal of the Credit Risk Manager..................................................
ARTICLE VIII DEFAULT 198
SECTION 8.01. Servicer Events of Default..........................................................
SECTION 8.02. Master Servicer or Trustee to Act; Appointment of Successor.........................
SECTION 8.03. Notification to Certificateholders..................................................
SECTION 8.04. Waiver of Events of Default.........................................................
ARTICLE IX CONCERNING THE TRUSTEE AND THE SECURITIES ADMINISTRATOR......................................
SECTION 9.01. Duties of Trustee and Securities Administrator......................................
SECTION 9.02. Certain Matters Affecting Trustee and Securities Administrator......................
SECTION 9.03. Trustee and Securities Administrator not Liable for Certificates or Mortgage
Loans...............................................................................
SECTION 9.04. Trustee and Securities Administrator May Own Certificates...........................
SECTION 9.05. Fees and Expenses of Trustee and Securities Administrator...........................
SECTION 9.06. Eligibility Requirements for Trustee and Securities Administrator...................
SECTION 9.07. Resignation and Removal of Trustee and Securities Administrator.....................
SECTION 9.08. Successor Trustee or Securities Administrator.......................................
SECTION 9.09. Merger or Consolidation of Trustee or Securities Administrator......................
SECTION 9.10. Appointment of Co-Trustee or Separate Trustee.......................................
SECTION 9.11. Appointment of Office or Agency.....................................................
SECTION 9.12. Representations and Warranties......................................................
ARTICLE X TERMINATION..................................................................................
▇▇▇▇▇▇▇ ▇▇.▇▇. ▇▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇▇▇▇▇ or Liquidation of All Mortgage Loans....................
SECTION 10.02. Additional Termination Requirements.................................................
ARTICLE XI REMIC PROVISIONS.............................................................................
SECTION 11.01. REMIC Administration................................................................
SECTION 11.02. Prohibited Transactions and Activities..............................................
SECTION 11.03. Indemnification.....................................................................
ARTICLE XII MISCELLANEOUS PROVISIONS.....................................................................
SECTION 12.01. Amendment...........................................................................
SECTION 12.02. Recordation of Agreement; Counterparts..............................................
SECTION 12.03. Limitation on Rights of Certificateholders..........................................
SECTION 12.04. Governing Law.......................................................................
SECTION 12.05. Notices.............................................................................
SECTION 12.06. Severability of Provisions..........................................................
SECTION 12.07. Notice to Rating Agencies...........................................................
SECTION 12.08. Article and Section References......................................................
SECTION 12.09. Grant of Security Interest..........................................................
SECTION 12.10. Survival of Indemnification.........................................................
EXHIBITS
Exhibit A-1 Form of Class A Certificate
Exhibit A-2 Form of Class M Certificate
Exhibit A-3 Form of Class CE Certificate
Exhibit A-4 Form of Class P Certificate
Exhibit A-5 Form of Class R Certificate
Exhibit B-1 Form of Transferor Representation Letter and Form of Transferee Representation Letter in
Connection with Transfer of the Class P Certificates, Class CE Certificates and Residual
Certificates Pursuant to Rule 144A Under the Securities Act
Exhibit B-2 Form of Transferor Representation Letter and Form of Transferee Representation Letter in
Connection with Transfer of the Class P Certificates, Class CE Certificates and Residual
Certificates Pursuant to Rule 501(a) Under the Securities Act
Exhibit B-3 Form of Transfer Affidavit and Agreement and Form of Transferor Affidavit in Connection with
Transfer of Residual Certificates
Exhibit C Form of Servicer Certification
Exhibit D Form of Power of Attorney
Schedule 1 Mortgage Loan Schedule
Schedule 2 Prepayment Charge Schedule
Schedule 3 Reserved
Schedule 4 Standard File Layout - Delinquency Reporting
Schedule 5 Standard File Layout - Scheduled/Scheduled
Schedule 6 Data Requirements of Servicing Advances Incurred Prior to Cut-off Date
Schedule 7 Standard File Layout - Simple Interest Mortgage Loans
This Pooling and Servicing Agreement, is dated and effective as of
November 1, 2005, among ACE SECURITIES CORP., as Depositor, ▇▇▇▇▇ FARGO BANK,
N.A., as a Servicer, ▇▇▇▇▇ FARGO BANK, N.A., Master Servicer and Securities
Administrator and HSBC BANK USA, NATIONAL ASSOCIATION, as Trustee.
PRELIMINARY STATEMENT:
The Depositor intends to sell pass-through certificates to be issued
hereunder in multiple classes, which in the aggregate will evidence the entire
beneficial ownership interest of the Trust Fund created hereunder. The Trust
Fund will consist of a segregated pool of assets comprised of the Mortgage Loans
and certain other related assets subject to this Agreement.
REMIC I
As provided herein, the Trustee will elect to treat the segregated pool
of assets consisting of the Mortgage Loans and certain other related assets
subject to this Agreement (other than the Reserve Fund and, for the avoidance of
doubt, the Supplemental Interest Trust and the Swap Agreement) as a REMIC for
federal income tax purposes, and such segregated pool of assets will be
designated as "REMIC I". The Class R-I Interest will be the sole class of
"residual interests" in REMIC I for purposes of the REMIC Provisions (as defined
herein). The following table irrevocably sets forth the designation, the REMIC I
Remittance Rate, the initial Uncertificated Balance and, for purposes of
satisfying Treasury regulation Section 1.860G-1(a)(4)(iii), the "latest possible
maturity date" for each of the REMIC I Regular Interests (as defined herein).
None of the REMIC I Regular Interests will be certificated.
REMIC I INITIAL LATEST POSSIBLE
DESIGNATIO REMITTANCE RATE UNCERTIFICATED BALANCE MATURITY DATE(1)
--------------- --------------- ---------------------- ------------------
A-I Variable(2) $ 42.04 November 25, 2035
I-1-A Variable(2) $ 4,735,346.21 November 25, 2035
I-1-B Variable(2) $ 4,735,346.21 November 25, 2035
I-2-A Variable(2) $ 5,735,991.09 November 25, 2035
I-2-B Variable(2) $ 5,735,991.09 November 25, 2035
I-3-A Variable(2) $ 6,725,530.52 November 25, 2035
I-3-B Variable(2) $ 6,725,530.52 November 25, 2035
I-4-A Variable(2) $ 7,696,214.32 November 25, 2035
I-4-B Variable(2) $ 7,696,214.32 November 25, 2035
I-5-A Variable(2) $ 8,640,043.89 November 25, 2035
I-5-B Variable(2) $ 8,640,043.89 November 25, 2035
I-6-A Variable(2) $ 9,548,932.09 November 25, 2035
I-6-B Variable(2) $ 9,548,932.09 November 25, 2035
I-7-A Variable(2) $ 10,414,799.34 November 25, 2035
I-7-B Variable(2) $ 10,414,799.34 November 25, 2035
I-8-A Variable(2) $ 11,229,145.22 November 25, 2035
I-8-B Variable(2) $ 11,229,145.22 November 25, 2035
I-9-A Variable(2) $ 11,981,078.71 November 25, 2035
I-9-B Variable(2) $ 11,981,078.71 November 25, 2035
I-10-A Variable(2) $ 12,505,464.81 November 25, 2035
I-10-B Variable(2) $ 12,505,464.81 November 25, 2035
I-11-A Variable(2) $ 11,983,726.31 November 25, 2035
I-11-B Variable(2) $ 11,983,726.31 November 25, 2035
I-12-A Variable(2) $ 11,483,707.34 November 25, 2035
I-12-B Variable(2) $ 11,483,707.34 November 25, 2035
I-13-A Variable(2) $ 11,004,599.77 November 25, 2035
I-13-B Variable(2) $ 11,004,599.77 November 25, 2035
I-14-A Variable(2) $ 10,545,526.89 November 25, 2035
I-14-B Variable(2) $ 10,545,526.89 November 25, 2035
I-15-A Variable(2) $ 10,105,649.72 November 25, 2035
I-15-B Variable(2) $ 10,105,649.72 November 25, 2035
I-16-A Variable(2) $ 9,684,163.70 November 25, 2035
I-16-B Variable(2) $ 9,684,163.70 November 25, 2035
I-17-A Variable(2) $ 9,280,276.44 November 25, 2035
I-17-B Variable(2) $ 9,280,276.44 November 25, 2035
I-18-A Variable(2) $ 8,893,295.00 November 25, 2035
I-18-B Variable(2) $ 8,893,295.00 November 25, 2035
I-19-A Variable(2) $ 8,532,650.86 November 25, 2035
I-19-B Variable(2) $ 8,532,650.86 November 25, 2035
I-20-A Variable(2) $ 8,241,777.01 November 25, 2035
I-20-B Variable(2) $ 8,241,777.01 November 25, 2035
I-21-A Variable(2) $ 10,676,921.79 November 25, 2035
I-21-B Variable(2) $ 10,676,921.79 November 25, 2035
I-22-A Variable(2) $ 26,862,664.08 November 25, 2035
I-22-B Variable(2) $ 26,862,664.08 November 25, 2035
I-23-A Variable(2) $ 22,292,564.05 November 25, 2035
I-23-B Variable(2) $ 22,292,564.05 November 25, 2035
I-24-A Variable(2) $ 86,305,093.06 November 25, 2035
I-24-B Variable(2) $ 86,305,093.06 November 25, 2035
I-25-A Variable(2) $ 2,864,777.94 November 25, 2035
I-25-B Variable(2) $ 2,864,777.94 November 25, 2035
I-26-A Variable(2) $ 1,567,270.64 November 25, 2035
I-26-B Variable(2) $ 1,567,270.64 November 25, 2035
I-27-A Variable(2) $ 1,502,078.06 November 25, 2035
I-27-B Variable(2) $ 1,502,078.06 November 25, 2035
I-28-A Variable(2) $ 1,440,680.23 November 25, 2035
I-28-B Variable(2) $ 1,440,680.23 November 25, 2035
I-29-A Variable(2) $ 1,381,855.31 November 25, 2035
I-29-B Variable(2) $ 1,381,855.31 November 25, 2035
I-30-A Variable(2) $ 1,325,492.52 November 25, 2035
I-30-B Variable(2) $ 1,325,492.52 November 25, 2035
I-31-A Variable(2) $ 1,271,486.36 November 25, 2035
I-31-B Variable(2) $ 1,271,486.36 November 25, 2035
I-32-A Variable(2) $ 1,219,734.21 November 25, 2035
I-32-B Variable(2) $ 1,219,734.21 November 25, 2035
I-33-A Variable(2) $ 1,170,164.97 November 25, 2035
I-33-B Variable(2) $ 1,170,164.97 November 25, 2035
I-34-A Variable(2) $ 1,123,541.03 November 25, 2035
I-34-B Variable(2) $ 1,123,541.03 November 25, 2035
I-35-A Variable(2) $ 1,077,323.46 November 25, 2035
I-35-B Variable(2) $ 1,077,323.46 November 25, 2035
I-36-A Variable(2) $ 7,428,413.80 November 25, 2035
I-36-B Variable(2) $ 7,428,413.80 November 25, 2035
I-37-A Variable(2) $ 677,223.61 November 25, 2035
I-37-B Variable(2) $ 677,223.61 November 25, 2035
I-38-A Variable(2) $ 652,546.40 November 25, 2035
I-38-B Variable(2) $ 652,546.40 November 25, 2035
I-39-A Variable(2) $ 628,774.67 November 25, 2035
I-39-B Variable(2) $ 628,774.67 November 25, 2035
I-40-A Variable(2) $ 605,875.25 November 25, 2035
I-40-B Variable(2) $ 605,875.25 November 25, 2035
I-41-A Variable(2) $ 583,815.44 November 25, 2035
I-41-B Variable(2) $ 583,815.44 November 25, 2035
I-42-A Variable(2) $ 562,564.16 November 25, 2035
I-42-B Variable(2) $ 562,564.16 November 25, 2035
I-43-A Variable(2) $ 542,091.86 November 25, 2035
I-43-B Variable(2) $ 542,091.86 November 25, 2035
I-44-A Variable(2) $ 522,369.14 November 25, 2035
I-44-B Variable(2) $ 522,369.14 November 25, 2035
I-45-A Variable(2) $ 503,368.54 November 25, 2035
I-45-B Variable(2) $ 503,368.54 November 25, 2035
I-46-A Variable(2) $ 13,371,104.85 November 25, 2035
I-46-B Variable(2) $ 13,371,104.85 November 25, 2035
A-II Variable(2) $ 1141 November 25, 2035
II-1-A Variable(2) $ 1,284,685.51 November 25, 2035
II-1-B Variable(2) $ 1,284,685.51 November 25, 2035
II-2-A Variable(2) $ 1,556,157.52 November 25, 2035
II-2-B Variable(2) $ 1,556,157.52 November 25, 2035
II-3-A Variable(2) $ 1,824,616.66 November 25, 2035
II-3-B Variable(2) $ 1,824,616.66 November 25, 2035
II-4-A Variable(2) $ 2,087,960.32 November 25, 2035
II-4-B Variable(2) $ 2,087,960.32 November 25, 2035
II-5-A Variable(2) $ 2,344,018.51 November 25, 2035
II-5-B Variable(2) $ 2,344,018.51 November 25, 2035
II-6-A Variable(2) $ 2,590,597.21 November 25, 2035
II-6-B Variable(2) $ 2,590,597.21 November 25, 2035
II-7-A Variable(2) $ 2,825,504.45 November 25, 2035
II-7-B Variable(2) $ 2,825,504.45 November 25, 2035
II-8-A Variable(2) $ 3,046,434.09 November 25, 2035
II-8-B Variable(2) $ 3,046,434.09 November 25, 2035
II-9-A Variable(2) $ 3,250,431.43 November 25, 2035
II-9-B Variable(2) $ 3,250,431.43 November 25, 2035
II-10-A Variable(2) $ 3,392,695.84 November 25, 2035
II-10-B Variable(2) $ 3,392,695.84 November 25, 2035
II-11-A Variable(2) $ 3,251,149.72 November 25, 2035
II-11-B Variable(2) $ 3,251,149.72 November 25, 2035
II-12-A Variable(2) $ 3,115,496.04 November 25, 2035
II-12-B Variable(2) $ 3,115,496.04 November 25, 2035
II-13-A Variable(2) $ 2,985,515.57 November 25, 2035
II-13-B Variable(2) $ 2,985,515.57 November 25, 2035
II-14-A Variable(2) $ 2,860,970.45 November 25, 2035
II-14-B Variable(2) $ 2,860,970.45 November 25, 2035
II-15-A Variable(2) $ 2,741,633.06 November 25, 2035
II-15-B Variable(2) $ 2,741,633.06 November 25, 2035
II-16-A Variable(2) $ 2,627,285.14 November 25, 2035
II-16-B Variable(2) $ 2,627,285.14 November 25, 2035
II-17-A Variable(2) $ 2,517,711.72 November 25, 2035
II-17-B Variable(2) $ 2,517,711.72 November 25, 2035
II-18-A Variable(2) $ 2,412,724.79 November 25, 2035
II-18-B Variable(2) $ 2,412,724.79 November 25, 2035
II-19-A Variable(2) $ 2,314,883.10 November 25, 2035
II-19-B Variable(2) $ 2,314,883.10 November 25, 2035
II-20-A Variable(2) $ 2,235,969.88 November 25, 2035
II-20-B Variable(2) $ 2,235,969.88 November 25, 2035
II-21-A Variable(2) $ 2,896,617.50 November 25, 2035
II-21-B Variable(2) $ 2,896,617.50 November 25, 2035
II-22-A Variable(2) $ 7,287,761.80 November 25, 2035
II-22-B Variable(2) $ 7,287,761.80 November 25, 2035
II-23-A Variable(2) $ 6,047,907.10 November 25, 2035
II-23-B Variable(2) $ 6,047,907.10 November 25, 2035
II-24-A Variable(2) $ 23,414,318.05 November 25, 2035
II-24-B Variable(2) $ 23,414,318.05 November 25, 2035
II-25-A Variable(2) $ 777,205.83 November 25, 2035
II-25-B Variable(2) $ 777,205.83 November 25, 2035
II-26-A Variable(2) $ 425,195.92 November 25, 2035
II-26-B Variable(2) $ 425,195.92 November 25, 2035
II-27-A Variable(2) $ 407,509.36 November 25, 2035
II-27-B Variable(2) $ 407,509.36 November 25, 2035
II-28-A Variable(2) $ 390,852.31 November 25, 2035
II-28-B Variable(2) $ 390,852.31 November 25, 2035
II-29-A Variable(2) $ 374,893.28 November 25, 2035
II-29-B Variable(2) $ 374,893.28 November 25, 2035
II-30-A Variable(2) $ 359,602.23 November 25, 2035
II-30-B Variable(2) $ 359,602.23 November 25, 2035
II-31-A Variable(2) $ 344,950.51 November 25, 2035
II-31-B Variable(2) $ 344,950.51 November 25, 2035
II-32-A Variable(2) $ 330,910.31 November 25, 2035
II-32-B Variable(2) $ 330,910.31 November 25, 2035
II-33-A Variable(2) $ 317,462.32 November 25, 2035
II-33-B Variable(2) $ 317,462.32 November 25, 2035
II-34-A Variable(2) $ 304,813.38 November 25, 2035
II-34-B Variable(2) $ 304,813.38 November 25, 2035
II-35-A Variable(2) $ 292,274.69 November 25, 2035
II-35-B Variable(2) $ 292,274.69 November 25, 2035
II-36-A Variable(2) $ 2,015,306.83 November 25, 2035
II-36-B Variable(2) $ 2,015,306.83 November 25, 2035
II-37-A Variable(2) $ 183,728.77 November 25, 2035
II-37-B Variable(2) $ 183,728.77 November 25, 2035
II-38-A Variable(2) $ 177,033.92 November 25, 2035
II-38-B Variable(2) $ 177,033.92 November 25, 2035
II-39-A Variable(2) $ 170,584.72 November 25, 2035
II-39-B Variable(2) $ 170,584.72 November 25, 2035
II-40-A Variable(2) $ 164,372.18 November 25, 2035
II-40-B Variable(2) $ 164,372.18 November 25, 2035
II-41-A Variable(2) $ 158,387.41 November 25, 2035
II-41-B Variable(2) $ 158,387.41 November 25, 2035
II-42-A Variable(2) $ 152,622.00 November 25, 2035
II-42-B Variable(2) $ 152,622.00 November 25, 2035
II-43-A Variable(2) $ 147,067.93 November 25, 2035
II-43-B Variable(2) $ 147,067.93 November 25, 2035
II-44-A Variable(2) $ 141,717.21 November 25, 2035
II-44-B Variable(2) $ 141,717.21 November 25, 2035
II-45-A Variable(2) $ 136,562.40 November 25, 2035
II-45-B Variable(2) $ 136,562.40 November 25, 2035
II-46-A Variable(2) $ 3,627,541.44 November 25, 2035
II-46-B Variable(2) $ 3,627,541.44 November 25, 2035
A-III Variable(2) $ 46.75 November 25, 2035
III-1-A Variable(2) $ 5,265,683.78 November 25, 2035
III-1-B Variable(2) $ 5,265,683.78 November 25, 2035
III-2-A Variable(2) $ 6,378,396.39 November 25, 2035
III-2-B Variable(2) $ 6,378,396.39 November 25, 2035
III-3-A Variable(2) $ 7,478,759.82 November 25, 2035
III-3-B Variable(2) $ 7,478,759.82 November 25, 2035
III-4-A Variable(2) $ 8,558,155.85 November 25, 2035
III-4-B Variable(2) $ 8,558,155.85 November 25, 2035
III-5-A Variable(2) $ 9,607,690.10 November 25, 2035
III-5-B Variable(2) $ 9,607,690.10 November 25, 2035
III-6-A Variable(2) $ 10,618,369.71 November 25, 2035
III-6-B Variable(2) $ 10,618,369.71 November 25, 2035
III-7-A Variable(2) $ 11,581,210.21 November 25, 2035
III-7-B Variable(2) $ 11,581,210.21 November 25, 2035
III-8-A Variable(2) $ 12,486,759.19 November 25, 2035
III-8-B Variable(2) $ 12,486,759.19 November 25, 2035
III-9-A Variable(2) $ 13,322,905.86 November 25, 2035
III-9-B Variable(2) $ 13,322,905.86 November 25, 2035
III-10-A Variable(2) $ 13,906,020.85 November 25, 2035
III-10-B Variable(2) $ 13,906,020.85 November 25, 2035
III-11-A Variable(2) $ 13,325,849.97 November 25, 2035
III-11-B Variable(2) $ 13,325,849.97 November 25, 2035
III-12-A Variable(2) $ 12,769,831.12 November 25, 2035
III-12-B Variable(2) $ 12,769,831.12 November 25, 2035
III-13-A Variable(2) $ 12,237,065.65 November 25, 2035
III-13-B Variable(2) $ 12,237,065.65 November 25, 2035
III-14-A Variable(2) $ 11,726,578.66 November 25, 2035
III-14-B Variable(2) $ 11,726,578.66 November 25, 2035
III-15-A Variable(2) $ 11,237,437.22 November 25, 2035
III-15-B Variable(2) $ 11,237,437.22 November 25, 2035
III-16-A Variable(2) $ 10,768,746.65 November 25, 2035
III-16-B Variable(2) $ 10,768,746.65 November 25, 2035
III-17-A Variable(2) $ 10,319,625.84 November 25, 2035
III-17-B Variable(2) $ 10,319,625.84 November 25, 2035
III-18-A Variable(2) $ 9,889,304.21 November 25, 2035
III-18-B Variable(2) $ 9,889,304.21 November 25, 2035
III-19-A Variable(2) $ 9,488,269.54 November 25, 2035
III-19-B Variable(2) $ 9,488,269.54 November 25, 2035
III-20-A Variable(2) $ 9,164,819.12 November 25, 2035
III-20-B Variable(2) $ 9,164,819.12 November 25, 2035
III-21-A Variable(2) $ 11,872,689.21 November 25, 2035
III-21-B Variable(2) $ 11,872,689.21 November 25, 2035
III-22-A Variable(2) $ 29,871,162.12 November 25, 2035
III-22-B Variable(2) $ 29,871,162.12 November 25, 2035
III-23-A Variable(2) $ 24,789,231.36 November 25, 2035
III-23-B Variable(2) $ 24,789,231.36 November 25, 2035
III-24-A Variable(2) $ 95,970,876.89 November 25, 2035
III-24-B Variable(2) $ 95,970,876.89 November 25, 2035
III-25-A Variable(2) $ 3,185,620.23 November 25, 2035
III-25-B Variable(2) $ 3,185,620.23 November 25, 2035
III-26-A Variable(2) $ 1,742,797.94 November 25, 2035
III-26-B Variable(2) $ 1,742,797.94 November 25, 2035
III-27-A Variable(2) $ 1,670,304.08 November 25, 2035
III-27-B Variable(2) $ 1,670,304.08 November 25, 2035
III-28-A Variable(2) $ 1,602,029.96 November 25, 2035
III-28-B Variable(2) $ 1,602,029.96 November 25, 2035
II-29-A Variable(2) $ 1,536,616.91 November 25, 2035
III-29-B Variable(2) $ 1,536,616.91 November 25, 2035
III-30-A Variable(2) $ 1,473,941.75 November 25, 2035
III-30-B Variable(2) $ 1,473,941.75 November 25, 2035
III-31-A Variable(2) $ 1,413,887.13 November 25, 2035
III-31-B Variable(2) $ 1,413,887.13 November 25, 2035
III-32-A Variable(2) $ 1,356,338.98 November 25, 2035
III-32-B Variable(2) $ 1,356,338.98 November 25, 2035
III-33-A Variable(2) $ 1,301,218.21 November 25, 2035
III-33-B Variable(2) $ 1,301,218.21 November 25, 2035
III-34-A Variable(2) $ 1,249,372.59 November 25, 2035
III-34-B Variable(2) $ 1,249,372.59 November 25, 2035
III-35-A Variable(2) $ 1,197,978.86 November 25, 2035
III-35-B Variable(2) $ 1,197,978.86 November 25, 2035
III-36-A Variable(2) $ 8,260,362.87 November 25, 2035
III-36-B Variable(2) $ 8,260,362.87 November 25, 2035
III-37-A Variable(2) $ 753,069.62 November 25, 2035
III-37-B Variable(2) $ 753,069.62 November 25, 2035
III-38-A Variable(2) $ 725,628.68 November 25, 2035
III-38-B Variable(2) $ 725,628.68 November 25, 2035
III-39-A Variable(2) $ 699,194.61 November 25, 2035
III-39-B Variable(2) $ 699,194.61 November 25, 2035
III-40-A Variable(2) $ 673,730.57 November 25, 2035
III-40-B Variable(2) $ 673,730.57 November 25, 2035
III-41-A Variable(2) $ 649,200.15 November 25, 2035
III-41-B Variable(2) $ 649,200.15 November 25, 2035
III-42-A Variable(2) $ 625,568.83 November 25, 2035
III-42-B Variable(2) $ 625,568.83 November 25, 2035
III-43-A Variable(2) $ 602,803.72 November 25, 2035
III-43-B Variable(2) $ 602,803.72 November 25, 2035
III-44-A Variable(2) $ 580,872.15 November 25, 2035
III-44-B Variable(2) $ 580,872.15 November 25, 2035
III-45-A Variable(2) $ 559,743.56 November 25, 2035
III-45-B Variable(2) $ 559,743.56 November 25, 2035
III-46-A Variable(2) $ 14,868,608.70 November 25, 2035
III-46-B Variable(2) $ 14,868,608.70 November 25, 2035
P Variable(2) $ 100.00 November 25, 2035
------------------
(1) For purposes of Section 1.860G-1(a)(4)(iii) of the Treasury regulations,
the Distribution Date immediately following the maturity date for the
Mortgage Loan with the latest maturity date has been designated as the
"latest possible maturity date" for each REMIC I Regular Interest.
(2) Calculated in accordance with the definition of "REMIC I Remittance Rate"
herein.
REMIC II
As provided herein, the Trustee will elect to treat the segregated pool
of assets consisting of the REMIC I Regular Interests as a REMIC for federal
income tax purposes, and such segregated pool of assets will be designated as
"REMIC II." The Class R-II Interest will evidence the sole class of "residual
interests" in REMIC II for purposes of the REMIC Provisions. The following table
irrevocably sets forth the designation, the REMIC II Remittance Rate, the
initial aggregate Uncertificated Balance and, for purposes of satisfying
Treasury regulation Section 1.860G-1(a)(4)(iii), the "latest possible maturity
date" for each of the REMIC II Regular Interests. None of the REMIC II Regular
Interests will be certificated.
REMIC II INITIAL LATEST POSSIBLE
REMITTANCE UNCERTIFICATED BALANCE MATURITY DATE (1)
DESIGNATION RATE
----------- ----------- ---------------------- -----------------
AA Variable(2) $ 880,829,570.91 November 25, 2035
A-1A Variable(2) $ 2,860,515.00 November 25, 2035
A-1B1 Variable(2) $ 620,840.00 November 25, 2035
A-1B2 Variable(2) $ 155,210.00 November 25, 2035
A-2A Variable(2) $ 1,570,465.00 November 25, 2035
A-2B Variable(2) $ 728,510.00 November 25, 2035
A-2C Variable(2) $ 485,025.00 November 25, 2035
A-2D Variable(2) $ 396,880.00 November 25, 2035
M-1 Variable(2) $ 346,040.00 November 25, 2035
M-2 Variable(2) $ 314,580.00 November 25, 2035
M-3 Variable(2) $ 224,700.00 November 25, 2035
M-4 Variable(2) $ 161,785.00 November 25, 2035
M-5 Variable(2) $ 152,795.00 November 25, 2035
M-6 Variable(2) $ 134,820.00 November 25, 2035
M-7 Variable(2) $ 143,810.00 November 25, 2035
M-8 Variable(2) $ 107,855.00 November 25, 2035
M-9 Variable(2) $ 98,870.00 November 25, 2035
M-10 Variable(2) $ 94,375.00 November 25, 2035
M-11 Variable(2) $ 89,880.00 November 25, 2035
ZZ Variable(2) $ 9,289,158.69 November 25, 2035
P Variable(2) $ 100.00 November 25, 2035
IO Variable(2) (3) November 25, 2035
IA-SUB Variable(2) $ 18,215.25 November 25, 2035
IA-GRP Variable(2) $ 75,425.55 November 25, 2035
IB-SUB Variable(2) $ 4,941.73 November 25, 2035
IB-GRP Variable(2) $ 20,462.73 November 25, 2035
II-SUB Variable(2) $ 20,255.27 November 25, 2035
II-GRP Variable(2) $ 83,872.87 November 25, 2035
XX Variable(2) $ 898,582,511.21 November 25, 2035
---------------------------
(1) For purposes of Section 1.860G-1(a)(4)(iii) of the Treasury
regulations, the Distribution Date immediately following the maturity
date for the Mortgage Loan with the latest maturity date has been
designated as the "latest possible maturity date" for each REMIC II
Regular Interest.
(2) Calculated in accordance with the definition of "REMIC II Remittance
Rate" herein.
(3) REMIC II Regular Interest IO will not have an Uncertificated Balance,
but will accrue interest on its Uncertificated Notional Amount.
REMIC III
As provided herein, the Trustee will elect to treat the segregated pool
of assets consisting of the REMIC II Regular Interests as a REMIC for federal
income tax purposes, and such segregated pool of assets will be designated as
"REMIC III." The Class R-III Interest will evidence the sole class of "residual
interests" in REMIC III for purposes of the REMIC Provisions. The following
table irrevocably sets forth the designation, the Pass-Through Rate, the initial
aggregate Certificate Principal Balance and, for purposes of satisfying Treasury
regulation Section 1.860G-1(a)(4)(iii), the "latest possible maturity date" for
the indicated Classes of Certificates.
INITIAL AGGREGATE
CERTIFICATE PRINCIPAL LATEST POSSIBLE
DESIGNATION PASS-THROUGH RATE BALANCE MATURITY DATE (1)
----------------------------- ----------------- --------------------- -----------------
Class A-1A Variable(2) $572,103,000.00 November 25, 2035
Class A-1B1 Variable(2) $124,168,000.00 November 25, 2035
Class A-1B2 Variable(2) $ 31,042,000.00 November 25, 2035
Class A-2A Variable(2) $314,093,000.00 November 25, 2035
Class A-2B Variable(2) $145,702,000.00 November 25, 2035
Class A-2C Variable(2) $ 97,005,000.00 November 25, 2035
Class A-2D Variable(2) $ 79,376,000.00 November 25, 2035
Class M-1 Variable(2) $ 69,208,000.00 November 25, 2035
Class M-2 Variable(2) $ 62,916,000.00 November 25, 2035
Class M-3 Variable(2) $ 44,940,000.00 November 25, 2035
Class M-4 Variable(2) $ 32,357,000.00 November 25, 2035
Class M-5 Variable(2) $ 30,559,000.00 November 25, 2035
Class M-6 Variable(2) $ 26,964,000.00 November 25, 2035
Class M-7 Variable(2) $ 28,762,000.00 November 25, 2035
Class M-8 Variable(2) $ 21,571,000.00 November 25, 2035
Class M-9 Variable(2) $ 19,774,000.00 November 25, 2035
Class M-10 Variable(2) $ 18,875,000.00 November 25, 2035
Class M-11 Variable(2) $ 17,976,000.00 November 25, 2035
Class P N/A(3) 100.00 November 25, 2035
Class CE N/A(4) $ 60,220,369.20 November 25, 2035
REMIC III Regular Interest IO N/A(5) (5) November 25, 2035
----------------
(1) For purposes of Section 1.860G-1(a)(4)(iii) of the Treasury regulations,
the Distribution Date immediately following the maturity date for the
Mortgage Loan with the latest maturity date has been designated as the
"latest possible maturity date" for each Class of Certificates.
(2) Calculated in accordance with the definition of "Pass-Through Rate"
herein. (3) The Class P Certificates will not accrue interest.
(4) The Class CE Certificates will accrue interest at its variable
Pass-Through Rate on a Notional Amount outstanding from time to time which
shall equal the Uncertificated Balance of the REMIC II Regular Interests
(other than REMIC II Regular Interest P). The Class CE Certificates will
not accrue interest on their Certificate Principal Balance.
(5) The REMIC III Regular Interest IO will not have a Pass-Through Rate or a
Certificate Principal Balance, but will be entitled to 100% of amounts
distributed on REMIC II Regular Interest IO.
The Mortgage Loans had an aggregate Scheduled Principal Balance as of
the Cut-off Date, after deducting all Monthly Payments due on or before the
Cut-off Date, of 1,797,611,469.20. As of the Cut-off Date, the Group IA Mortgage
Loans had an aggregate Scheduled Principal Balance equal to 754,255,471.43, the
Group IB Mortgage Loans had an aggregate Scheduled Principal Balance equal to
204,627,292.22 and the Group II Mortgage Loans had an aggregate Scheduled
Principal Balance equal to 838,728,705.55.
In consideration of the mutual agreements herein contained, the
Depositor, the Servicers, the Master Servicer, the Securities Administrator and
the Trustee agree as follows:
ARTICLE I
DEFINITIONS
SECTION 1.01. Defined Terms.
Whenever used in this Agreement, including, without limitation, in the
Preliminary Statement hereto, the following words and phrases, unless the
context otherwise requires, shall have the meanings specified in this Article.
Unless otherwise specified, all calculations described herein shall be made on
the basis of a 360-day year consisting of twelve 30-day months.
"Accepted Master Servicing Practices": With respect to any Mortgage
Loan, as applicable, either (x) those customary mortgage master servicing
practices of prudent mortgage servicing institutions that master service
mortgage loans of the same type and quality as such Mortgage Loan in the
jurisdiction where the related Mortgaged Property is located, to the extent
applicable to the Master Servicer or (y) as provided in Section 3.01 hereof, but
in no event below the standard set forth in clause (x).
"Accepted Servicing Practices": As defined in Section 3.01.
"Account": The Collection Accounts and the Distribution Account, as the
context may require.
"Accrued Certificate Interest": With respect to any Class A
Certificate, Mezzanine Certificate or Class CE Certificate and each Distribution
Date, interest accrued during the related Interest Accrual Period at the
Pass-Through Rate for such Certificate for such Distribution Date on the
Certificate Principal Balance, in the case of the Class A Certificates and the
Mezzanine Certificates, or on the Notional Amount in the case of the Class CE
Certificates, of such Certificate immediately prior to such Distribution Date.
The Class P Certificates are not entitled to distributions in respect of
interest and, accordingly, will not accrue interest. All distributions of
interest on the Class A Certificates and the Mezzanine Certificates will be
calculated on the basis of a 360-day year and the actual number of days in the
applicable Interest Accrual Period. All distributions of interest on the Class
CE Certificates will be based on a 360-day year consisting of twelve 30-day
months. Accrued Certificate Interest with respect to each Distribution Date, as
to any Class A Certificate, Mezzanine Certificate or Class CE Certificate shall
be reduced by an amount equal to the portion allocable to such Certificate
pursuant to Section 1.02 hereof, if any, of the sum of (a) the aggregate
Prepayment Interest Shortfall, if any, for such Distribution Date to the extent
not covered by payments pursuant to Section 3.22 or Section 4.18 of this
Agreement or pursuant to the Servicing Agreement and (b) the aggregate amount of
any Relief Act Interest Shortfall, if any, for such Distribution Date. In
addition, Accrued Certificate Interest with respect to each Distribution Date,
as to any Class CE Certificate, shall be reduced by an amount equal to the
portion allocable to such Class CE Certificate of Realized Losses, if any,
pursuant to Section 1.02 and Section 5.04 hereof.
"Adjustable Rate Mortgage Loan": Each of the Mortgage Loans identified
in the Mortgage Loan Schedule as having a Mortgage Rate that is subject to
adjustment.
"Adjustment Date": With respect to each Adjustable Rate Mortgage Loan,
the first day of the month in which the Mortgage Rate of an Adjustable Rate
Mortgage Loan changes pursuant to the related Mortgage Note. The first
Adjustment Date following the Cut-off Date as to each Adjustable Rate Mortgage
Loan is set forth in the Mortgage Loan Schedule.
"Administration Fees: The sum of (i) the Servicing Fees, (ii) the
Master Servicing Fee, (iii) the Credit Risk Management Fee and (iv) any fees
payable in connection with any lender paid mortgage insurance policies.
"Administration Fee Rate": The sum of (i) the Servicing Fee Rate, (ii)
the Master Servicer Fee Rate, (iii) the Credit Risk Management Fee Rate and (iv)
the rate at which any fee payable in connection with any lender paid mortgage
insurance policies.
"Advance Facility": As defined in Section 3.25(a).
"Advance Financing Person": As defined in Section 3.25(a).
"Advance Reimbursement Amounts": As defined in Section 3.25(b).
"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.
"Aggregate Loss Severity Percentage": With respect to any Distribution
Date, the percentage equivalent of a fraction, the numerator of which is the
aggregate amount of Realized Losses incurred on any Mortgage Loans from the
Cut-off Date to the last day of the preceding calendar month and the denominator
of which is the aggregate principal balance of such Mortgage Loans immediately
prior to the liquidation of such Mortgage Loans.
"Agreement": This Pooling and Servicing Agreement, including all
exhibits and schedules hereto and all amendments hereof and supplements hereto.
"Allocated Realized Loss Amount": With respect to any Class of
Mezzanine Certificates and any Distribution Date, an amount equal to the sum of
any Realized Loss allocated to that Class of Certificates on the Distribution
Date and any Allocated Realized Loss Amount for that Class remaining unpaid from
the previous Distribution Date.
"Amounts Held for Future Distribution": As to any Distribution Date,
the aggregate amount held in the Collection Accounts at the close of business on
the immediately preceding Determination Date on account of (i) all Monthly
Payments or portions thereof received in respect of the Mortgage Loans due after
the related Due Period and (ii) Principal Prepayments and Liquidation Proceeds
received in respect of such Mortgage Loans after the last day of the related
Prepayment Period.
"Assignment": An assignment of Mortgage, notice of transfer or
equivalent instrument, in recordable form, which is sufficient under the laws of
the jurisdiction where the related Mortgaged Property is located to reflect of
record the sale and assignment of the Mortgage, which assignment, notice of
transfer or equivalent instrument may be in the form of one or more blanket
assignments covering Mortgages secured by Mortgaged Properties located in the
same county, if permitted by law.
"Assignment Agreement": The Assignment, Assumption and Recognition
Agreement, dated as of November 28, 2005, by and among the Seller, the Depositor
and Countrywide evidencing the assignment of the Servicing Agreement to the
extent of the servicing of the Countrywide Mortgage Loans, to the Depositor.
"Available Distribution Amount": With respect to any Distribution Date,
an amount equal to (1) the sum of (a) the aggregate of the amounts on deposit in
the Collection Accounts and Distribution Account as of the close of business on
the related Servicer Remittance Date, (b) the aggregate of any amounts deposited
in the Distribution Account by the Servicers or the Master Servicer in respect
of Prepayment Interest Shortfalls for such Distribution Date pursuant to Section
3.22 or Section 4.18 of this Agreement or pursuant to the Servicing Agreement,
(c) the aggregate of any P&I Advances for such Distribution Date made by the
Servicers pursuant to Section 5.03 of this Agreement or pursuant to the
Servicing Agreement and (d) the aggregate of any P&I Advances made by a
successor Servicer (including the Master Servicer or the Trustee, as applicable)
for such Distribution Date pursuant to Section 8.02 of this Agreement or
pursuant to the Servicing Agreement, reduced (to an amount not less than zero)
by (2) the portion of the amount described in clause (1)(a) above that
represents (i) Amounts Held for Future Distribution, (ii) Principal Prepayments
on the Mortgage Loans received after the related Prepayment Period (together
with any interest payments received with such Principal Prepayments to the
extent they represent the payment of interest accrued on the Mortgage Loans
during a period subsequent to the related Prepayment Period), (iii) Liquidation
Proceeds, Insurance Proceeds and Subsequent Recoveries received in respect of
the Mortgage Loans after the related Prepayment Period, (iv) amounts
reimbursable or payable to the Depositor, the Servicers, the Trustee, the Master
Servicer, the Securities Administrator or the Custodians pursuant to Section
3.09 or 9.05 of this Agreement or otherwise payable in respect of Extraordinary
Trust Fund Expenses or reimbursable or payable under the Servicing Agreement,
(v) the Credit Risk Management Fee, (vi) amounts deposited in a Collection
Account or the Distribution Account in error, (vii) the amount of any Prepayment
Charges collected by the Servicer in connection with the Principal Prepayment of
any of the Mortgage Loans and (viii) amounts reimbursable to a successor
Servicer (including the Master Servicer or the Trustee, as applicable) pursuant
to Section 8.02 of this Agreement or pursuant to the Servicing Agreement.
"Balloon Mortgage Loan": A Mortgage Loan that provides for the payment
of the unamortized principal balance of such Mortgage Loan in a single payment,
that is substantially greater than the preceding monthly payment at the maturity
of such Mortgage Loan.
"Balloon Payment": A payment of the unamortized principal balance of a
Mortgage Loan in a single payment, that is substantially greater than the
preceding Monthly Payment at the maturity of such Mortgage Loan.
"Bankruptcy Code": The Bankruptcy Reform Act of 1978 (Title 11 of the
United States Code), as amended.
"Book-Entry Certificates": The Offered Certificates for so long as the
Certificates of such Class shall be registered in the name of the Depository or
its nominee.
"Book-Entry Custodian": The custodian appointed pursuant to Section
6.01.
"Business Day": Any day other than a Saturday, a Sunday or a day on
which banking or savings and loan institutions in the States of New York,
California, Maryland, Minnesota, Texas or in the city in which the Corporate
Trust Office of the Trustee is located, are authorized or obligated by law or
executive order to be closed.
"Cash-Out Refinancing": A Refinanced Mortgage Loan the proceeds of
which are more than a nominal amount in excess of the principal balance of any
existing first mortgage plus any subordinate mortgage on the related Mortgaged
Property and related closing costs.
"Certificate": Any one of ACE Securities Corp., Asset Backed
Pass-Through Certificates, Series 2005-HE7, Class A-1A, Class A-1B1, Class
A-1B2, Class A-2A, Class A-2B, Class A-2C, Class A-2D, Class M-1, Class M-2,
Class M-3, Class M-4, Class M-5, Class M-6, Class M-7, Class M-8, Class M-9,
Class M-10, Class M-11, Class P, Class CE and Class R Certificates issued under
this Agreement.
"Certificate Factor": With respect to any Class of Certificates (other
than the Residual Certificates) as of any Distribution Date, a fraction,
expressed as a decimal carried to six places, the numerator of which is the
aggregate Certificate Principal Balance (or Notional Amount, in the case of the
Class CE Certificates) of such Class of Certificates on such Distribution Date
(after giving effect to any distributions of principal and allocations of
Realized Losses resulting in reduction of the Certificate Principal Balance (or
Notional Amount, in the case of the Class CE Certificates) of such Class of
Certificates to be made on such Distribution Date), and the denominator of which
is the initial aggregate Certificate Principal Balance (or Notional Amount, in
the case of the Class CE Certificates) of such Class of Certificates as of the
Closing Date.
"CERTIFICATE MARGIN": With respect to the Class A-1A Certificates and,
for purposes of the definition of "Marker Rate", REMIC II Regular Interest A-1A,
0.24% in the case of each Distribution Date through and including the Optional
Termination Date and 0.48% in the case of each Distribution Date thereafter.
With respect to the Class A-1B1 Certificates and, for purposes of the
definition of "Marker Rate", REMIC II Regular Interest A-1B1, 0.25% in the case
of each Distribution Date through and including the Optional Termination Date
and 0.50% in the case of each Distribution Date thereafter.
With respect to the Class A-1B2 Certificates and, for purposes of the
definition of "Marker Rate", REMIC II Regular Interest A-1B2, 0.30% in the case
of each Distribution Date through and including the Optional Termination Date
and 0.60% in the case of each Distribution Date thereafter.
With respect to the Class A-2A Certificates and, for purposes of the
definition of "Marker Rate", REMIC II Regular Interest A-2A, 0.10% in the case
of each Distribution Date through and including the Optional Termination Date
and 0.20% in the case of each Distribution Date thereafter.
With respect to the Class A-2B Certificates and, for purposes of the
definition of "Marker Rate", REMIC II Regular Interest A-2B, 0.18% in the case
of each Distribution Date through and including the Optional Termination Date
and 0.36% in the case of each Distribution Date thereafter.
With respect to the Class A-2C Certificates and, for purposes of the
definition of "Marker Rate", REMIC II Regular Interest A-2C, 0.25% in the case
of each Distribution Date through and including the Optional Termination Date
and 0.50% in the case of each Distribution Date thereafter.
With respect to the Class A-2D Certificates and, for purposes of the
definition of "Marker Rate", REMIC II Regular Interest A-2D, 0.33% in the case
of each Distribution Date through and including the Optional Termination Date
and 0.66% in the case of each Distribution Date thereafter.
With respect to the Class M-1 Certificates and, for purposes of the
definition of "Marker Rate", REMIC II Regular Interest M-1, 0.44% in the case of
each Distribution Date through and including the Optional Termination Date and
0.66% in the case of each Distribution Date thereafter.
With respect to the Class M-2 Certificates and, for purposes of the
definition of "Marker Rate", REMIC II Regular Interest M-2, 0.46% in the case of
each Distribution Date through and including the Optional Termination Date and
0.69% in the case of each Distribution Date thereafter.
With respect to the Class M-3 Certificates and, for purposes of the
definition of "Marker Rate", REMIC II Regular Interest M-3, 0.48% in the case of
each Distribution Date through and including the Optional Termination Date and
0.72% in the case of each Distribution Date thereafter. With respect to the
Class M-4 Certificates and, for purposes of the definition of "Marker Rate",
REMIC II Regular Interest M-4, 0.62% in the case of each Distribution Date
through and including the Optional Termination Date and 0.93% in the case of
each Distribution Date thereafter.
With respect to the Class M-5 Certificates and, for purposes of the
definition of "Marker Rate", REMIC II Regular Interest M-5, 0.70% in the case of
each Distribution Date through and including the Optional Termination Date and
1.05% in the case of each Distribution Date thereafter.
With respect to the Class M-6 Certificates and, for purposes of the
definition of "Marker Rate", REMIC II Regular Interest M-6, 0.80% in the case of
each Distribution Date through and including the Optional Termination Date and
1.20% in the case of each Distribution Date thereafter.
With respect to the Class M-7 Certificates and, for purposes of the
definition of "Marker Rate", REMIC II Regular Interest M-7, 1.60% in the case of
each Distribution Date through and including the Optional Termination Date and
2.10% in the case of each Distribution Date thereafter.
With respect to the Class M-8 Certificates and, for purposes of the
definition of "Marker Rate", REMIC II Regular Interest M-8, 1.70% in the case of
each Distribution Date through and including the Optional Termination Date and
2.20% in the case of each Distribution Date thereafter.
With respect to the Class M-9 Certificates and, for purposes of the
definition of "Marker Rate", REMIC II Regular Interest M-9, 2.50% in the case of
each Distribution Date through and including the Optional Termination Date and
3.00% in the case of each Distribution Date thereafter.
With respect to the Class M-10 Certificates and, for purposes of the
definition of "Marker Rate", REMIC II Regular Interest M-10, 2.50% in the case
of each Distribution Date through and including the Optional Termination Date
and 3.00% in the case of each Distribution Date thereafter.
With respect to the Class M-11 Certificates and, for purposes of the
definition of "Marker Rate", REMIC II Regular Interest M-11, 2.50% in the case
of each Distribution Date through and including the Optional Termination Date
and 3.00% in the case of each Distribution Date thereafter.
"Certificateholder" or "Holder": The Person in whose name a Certificate
is registered in the Certificate Register, except that a Disqualified
Organization or a Non-United States Person shall not be a Holder of a Residual
Certificate for any purposes hereof, and solely for the purposes of giving any
consent pursuant to this Agreement, any Certificate registered in the name of or
beneficially owned by the Depositor, the Seller, a Servicer, the Master
Servicer, the Securities Administrator, the Trustee or any Affiliate thereof
shall be deemed not to be outstanding and the Voting Rights to which it is
entitled shall not be taken into account in determining whether the requisite
percentage of Voting Rights necessary to effect any such consent has been
obtained, except as otherwise provided in Section 12.01 of this Agreement. The
Trustee and the Securities Administrator may conclusively rely upon a
certificate of the Depositor, the Seller, the Master Servicer, the Securities
Administrator or a Servicer in determining whether a Certificate is held by an
Affiliate thereof. All references herein to "Holders" or "Certificateholders"
shall reflect the rights of Certificate Owners as they may indirectly exercise
such rights through the Depository and participating members thereof, except as
otherwise specified herein; provided, however, that the Trustee and the
Securities Administrator shall be required to recognize as a "Holder" or
"Certificateholder" only the Person in whose name a Certificate is registered in
the Certificate Register.
"Certificate Owner": With respect to a Book-Entry Certificate, the
Person who is the beneficial owner of such Certificate as reflected on the books
of the Depository or on the books of a Depository Participant or on the books of
an indirect participating brokerage firm for which a Depository Participant acts
as agent.
"Certificate Principal Balance": With respect to each Class A
Certificate, Mezzanine Certificate or Class P Certificate as of any date of
determination, the Certificate Principal Balance of such Certificate on the
Distribution Date immediately prior to such date of determination plus any
Subsequent Recoveries added to the Certificate Principal Balance of such
Certificate pursuant to Section 5.04 of this Agreement, minus all distributions
allocable to principal made thereon and Realized Losses allocated thereto, if
any, on such immediately prior Distribution Date (or, in the case of any date of
determination up to and including the first Distribution Date, the initial
Certificate Principal Balance of such Certificate, as stated on the face
thereof). With respect to each Class CE Certificate as of any date of
determination, an amount equal to the Percentage Interest evidenced by such
Certificate times the excess, if any, of (A) the then aggregate Uncertificated
Balances of the REMIC II Regular Interests over (B) the then aggregate
Certificate Principal Balances of the Class A Certificates, the Mezzanine
Certificates and the Class P Certificates then outstanding. The aggregate
initial Certificate Principal Balance of each Class of Regular Certificates is
set forth in the Preliminary Statement hereto.
"Certificate Register": The register maintained pursuant to Section
6.02 of this Agreement.
"Class": Collectively, all of the Certificates bearing the same class
designation.
"Class A Certificate": Any Class A-1A, Class A-1B1, Class A-1B2, Class
A-2A, Class A-2B, Class A-2C or Class A-2D Certificate.
"Class A Principal Distribution Amount": The Class A Principal
Distribution Amount is an amount equal to the sum of: (i) the Class A-1A
Principal Distribution Amount, (ii) the Class A-1B Principal Distribution Amount
and (iii) the Class A-2 Principal Distribution Amount.
"Class A-1A Allocation Percentage": With respect to any Distribution
Date is the percentage equivalent of a fraction, the numerator of which is (x)
the Group IA Principal Remittance Amount for such Distribution Date and the
denominator of which is (y) the Principal Remittance Amount for such
Distribution Date.
"Class A-1A Certificate": Any one of the Class A-1A Certificates
executed and authenticated by the Securities Administrator and delivered by the
Trustee, substantially in the form annexed hereto as Exhibit A-1 and evidencing
a Regular Interest in REMIC III for purposes of the REMIC Provisions.
"Class A-1A Principal Distribution Amount": With respect to any
Distribution Date on or after the Stepdown Date and on which a Trigger Event is
not in effect, the excess of (x) the Certificate Principal Balance of the Class
A-1A Certificates immediately prior to such Distribution Date over (y) the
lesser of (A) the product of (i) 51.70% and (ii) the aggregate Stated Principal
Balance of the Group IA Mortgage Loans as of the last day of the related Due
Period (after giving effect to scheduled payments of principal due during the
related Due Period, to the extent received or advanced and unscheduled
collections of principal received during the related Prepayment Period) and (B)
the aggregate Stated Principal Balance of the Group IA Mortgage Loans as of the
last day of the related Due Period (after giving effect to scheduled payments of
principal due during the related Due Period, to the extent received or advanced
and unscheduled collections of principal received during the related Prepayment
Period) minus the product of (i) 0.50% and (ii) the aggregate principal balance
of the Group IA Mortgage Loans as of the Cut-off Date.
"Class A-1B Allocation Percentage": With respect to any Distribution
Date is the percentage equivalent of a fraction, the numerator of which is (x)
the Group IB Principal Remittance Amount for such Distribution Date and the
denominator of which is (y) the Principal Remittance Amount for such
Distribution Date.
"Class ▇-▇▇ ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇": With respect to any
Distribution Date on or after the Stepdown Date and on which a Trigger Event is
not in effect, the excess of (x) the sum of the Certificate Principal Balances
of the Class A-1B1 Certificates and Class A-1B2 Certificates immediately prior
to such Distribution Date over (y) the lesser of (A) the product of (i) 51.70%
and (ii) the aggregate Stated Principal Balance of the Group IB Mortgage Loans
as of the last day of the related Due Period (after giving effect to scheduled
payments of principal due during the related Due Period, to the extent received
or advanced and unscheduled collections of principal received during the related
Prepayment Period) and (B) the aggregate Stated Principal Balance of the Group
IB Mortgage Loans as of the last day of the related Due Period (after giving
effect to scheduled payments of principal due during the related Due Period, to
the extent received or advanced and unscheduled collections of principal
received during the related Prepayment Period) minus the product of (i) 0.50%
and (ii) the aggregate principal balance of the Group IB Mortgage Loans as of
the Cut-off Date.
"Class A-1B1 Certificate": Any one of the Class A-1B1 Certificates
executed and authenticated by the Securities Administrator and delivered by the
Trustee, substantially in the form annexed hereto as Exhibit A-1 and evidencing
a Regular Interest in REMIC III for purposes of the REMIC Provisions.
"Class A-1B2 Certificate": Any one of the Class A-1B2 Certificates
executed and authenticated by the Securities Administrator and delivered by the
Trustee, substantially in the form annexed hereto as Exhibit A-1 and evidencing
a Regular Interest in REMIC III for purposes of the REMIC Provisions.
"Class A-2 Allocation Percentage": With respect to any Distribution
Date is the percentage equivalent of a fraction, the numerator of which is (x)
the Group II Principal Remittance Amount for such Distribution Date and the
denominator of which is (y) the Principal Remittance Amount for such
Distribution Date.
"Class A-2 Certificate": Any Class A-2A, Class A-2B, Class A-2C or
Class A-2D Certificate.
"Class A-2 Principal Distribution Amount": With respect to any
Distribution Date on or after the Stepdown Date and on which a Trigger Event is
not in effect, the excess of (x) the sum of the Certificate Principal Balances
of the Class A-2A, Class A-2B, Class A-2C and Class A-2D Certificates
immediately prior to such Distribution Date over (y) the lesser of (A) the
product of (i) 51.70% and (ii) the aggregate Stated Principal Balance of the
Group II Mortgage Loans as of the last day of the related Due Period (after
giving effect to scheduled payments of principal due during the related Due
Period, to the extent received or advanced and unscheduled collections of
principal received during the related Prepayment Period) and (B) the aggregate
Stated Principal Balance of the Group II Mortgage Loans as of the last day of
the related Due Period (after giving effect to scheduled payments of principal
due during the related Due Period, to the extent received or advanced and
unscheduled collections of principal received during the related Prepayment
Period) minus the product of (i) 0.50% and (ii) the aggregate principal balance
of the Mortgage Loans as of the Cut-off Date.
"Class A-2A Certificate": Any one of the Class A-2A Certificates
executed and authenticated by the Securities Administrator and delivered by the
Trustee, substantially in the form annexed hereto as Exhibit A-1 and evidencing
a Regular Interest in REMIC III for purposes of the REMIC Provisions.
"Class A-2B Certificate": Any one of the Class A-2B Certificates
executed and authenticated by the Securities Administrator and delivered by the
Trustee, substantially in the form annexed hereto as Exhibit A-1 and evidencing
a Regular Interest in REMIC III for purposes of the REMIC Provisions.
"Class A-2C Certificate": Any one of the Class A-2C Certificates
executed and authenticated by the Securities Administrator and delivered by the
Trustee, substantially in the form annexed hereto as Exhibit A-1 and evidencing
a Regular Interest in REMIC III for purposes of the REMIC Provisions.
"Class A-2D Certificate": Any one of the Class A-2D Certificates
executed and authenticated by the Securities Administrator and delivered by the
Trustee, substantially in the form annexed hereto as Exhibit A-1 and evidencing
a Regular Interest in REMIC III for purposes of the REMIC Provisions.
"Class CE Certificate": Any one of the Class CE Certificates executed
and authenticated by the Securities Administrator and delivered by the Trustee,
substantially in the form annexed hereto as Exhibit A-3 and evidencing a Regular
Interest in REMIC III for purposes of the REMIC Provisions.
"Class IO Distribution Amount": As defined in Section 5.07(e) hereof.
For purposes of clarity, the Class IO Distribution Amount for any Distribution
Date shall equal the amount payable to the Supplemental Interest Trust on such
Distribution Date in excess of the amount payable on the Class IO Interest on
such Distribution Date, all as further provided in Section 5.07(e) hereof.
"Class IO Interest": An uncertificated interest in the Trust Fund held
by the Trustee, evidencing a REMIC Regular Interest in REMIC III for purposes of
the REMIC Provisions.
"Class M Certificates": The Class M-1, Class M-2, Class M-3, Class M-4,
Class M-5, Class M-6, Class M-7, Class M-8, Class M-9, Class M-10 and Class M-11
Certificates.
"Class M-1 Certificate": Any one of the Class M-1 Certificates executed
and authenticated by the Securities Administrator and delivered by the Trustee,
substantially in the form annexed hereto as Exhibit A-2 and evidencing a Regular
Interest in REMIC III for purposes of the REMIC Provisions.
"Class M-1 Principal Distribution Amount": With respect to any
Distribution Date on or after the Stepdown Date and on which a Trigger Event is
not in effect, the excess of (x) the sum of (i) the aggregate Certificate
Principal Balance of the Class A Certificates (after taking into account the
payment of the Class A Principal Distribution Amount on such Distribution Date)
and (ii) the Certificate Principal Balance of the Class M-1 Certificates
immediately prior to such Distribution Date over (y) the lesser of (A) the
product of (i) 59.40% and (ii) the aggregate Stated Principal Balance of the
Mortgage Loans as of the last day of the related Due Period (after giving effect
to scheduled payments of principal due during the related Due Period, to the
extent received or advanced and unscheduled collections of principal received
during the related Prepayment Period) and (B) the aggregate Stated Principal
Balance of the Mortgage Loans as of the last day of the related Due Period
(after giving effect to scheduled payments of principal due during the related
Due Period, to the extent received or advanced and unscheduled collections of
principal received during the related Prepayment Period) minus the product of
(i) 0.50% and (ii) the aggregate principal balance of the Mortgage Loans as of
the Cut-off Date.
"Class M-2 Certificate": Any one of the Class M-2 Certificates executed
and authenticated by the Securities Administrator and delivered by the Trustee,
substantially in the form annexed hereto as Exhibit A-2 and evidencing a Regular
Interest in REMIC III for purposes of the REMIC Provisions.
"Class M-2 Principal Distribution Amount": With respect to any
Distribution Date on or after the Stepdown Date and on which a Trigger Event is
not in effect, the excess of (x) the sum of (i) the aggregate Certificate
Principal Balance of the Class A Certificates (after taking into account the
payment of the Class A Principal Distribution Amount on such Distribution Date),
(ii) the Certificate Principal Balance of the Class M-1 Certificates (after
taking into account the payment of the Class M-1 Principal Distribution Amount
on such Distribution Date) and (iii) the Certificate Principal Balance of the
Class M-2 Certificates immediately prior to such Distribution Date over (y) the
lesser of (A) the product of (i) 66.40% and (ii) the aggregate Stated Principal
Balance of the Mortgage Loans as of the last day of the related Due Period
(after giving effect to scheduled payments of principal due during the related
Due Period, to the extent received or advanced and unscheduled collections of
principal received during the related Prepayment Period) and (B) the aggregate
Stated Principal Balance of the Mortgage Loans as of the last day of the related
Due Period (after giving effect to scheduled payments of principal due during
the related Due Period, to the extent received or advanced and unscheduled
collections of principal received during the related Prepayment Period) minus
the product of (i) 0.50% and (ii) the aggregate principal balance of the
Mortgage Loans as of the Cut-off Date.
"Class M-3 Certificate": Any one of the Class M-3 Certificates executed
and authenticated by the Securities Administrator and delivered by the Trustee,
substantially in the form annexed hereto as Exhibit A-2 and evidencing a Regular
Interest in REMIC III for purposes of the REMIC Provisions.
"Class M-3 Principal Distribution Amount": With respect to any
Distribution Date on or after the Stepdown Date and on which a Trigger Event is
not in effect, the excess of (x) the sum of (i) the aggregate Certificate
Principal Balance of the Class A Certificates (after taking into account the
payment of the Class A Principal Distribution Amount on such Distribution Date),
(ii) the Certificate Principal Balance of the Class M-1 Certificates (after
taking into account the payment of the Class M-1 Principal Distribution Amount
on such Distribution Date), (iii) the Certificate Principal Balance of the Class
M-2 Certificates (after taking into account the payment of the Class M-2
Principal Distribution Amount on such Distribution Date) and (iv) the
Certificate Principal Balance of the Class M-3 Certificates immediately prior to
such Distribution Date over (y) the lesser of (A) the product of (i) 71.40% and
(ii) the aggregate Stated Principal Balance of the Mortgage Loans as of the last
day of the related Due Period (after giving effect to scheduled payments of
principal due during the related Due Period, to the extent received or advanced
and unscheduled collections of principal received during the related Prepayment
Period) and (B) the aggregate Stated Principal Balance of the Mortgage Loans as
of the last day of the related Due Period (after giving effect to scheduled
payments of principal due during the related Due Period, to the extent received
or advanced and unscheduled collections of principal received during the related
Prepayment Period) minus the product of (i) 0.50% and (ii) the aggregate
principal balance of the Mortgage Loans as of the Cut-off Date.
"Class M-4 Certificate": Any one of the Class M-4 Certificates executed
and authenticated by the Securities Administrator and delivered by the Trustee,
substantially in the form annexed hereto as Exhibit A-2 and evidencing a Regular
Interest in REMIC III for purposes of the REMIC Provisions.
"Class M-4 Principal Distribution Amount": With respect to any
Distribution Date on or after the Stepdown Date and on which a Trigger Event is
not in effect, the excess of (x) the sum of (i) the aggregate Certificate
Principal Balance of the Class A Certificates (after taking into account the
payment of the Class A Principal Distribution Amount on such Distribution Date),
(ii) the Certificate Principal Balance of the Class M-1 Certificates (after
taking into account the payment of the Class M-1 Principal Distribution Amount
on such Distribution Date), (iii) the Certificate Principal Balance of the Class
M-2 Certificates (after taking into account the payment of the Class M-2
Principal Distribution Amount on such Distribution Date), (iv) the Certificate
Principal Balance of the Class M-3 Certificates (after taking into account the
payment of the Class M-3 Principal Distribution Amount on such Distribution
Date) and (v) the Certificate Principal Balance of the Class M-4 Certificates
immediately prior to such Distribution Date over (y) the lesser of (A) the
product of (i) 75.00% and (ii) the aggregate Stated Principal Balance of the
Mortgage Loans as of the last day of the related Due Period (after giving effect
to scheduled payments of principal due during the related Due Period, to the
extent received or advanced and unscheduled collections of principal received
during the related Prepayment Period) and (B) the aggregate Stated Principal
Balance of the Mortgage Loans as of the last day of the related Due Period
(after giving effect to scheduled payments of principal due during the related
Due Period, to the extent received or advanced and unscheduled collections of
principal received during the related Prepayment Period) minus the product of
(i) 0.50% and (ii) the aggregate principal balance of the Mortgage Loans as of
the Cut-off Date.
"Class M-5 Certificate": Any one of the Class M-5 Certificates executed
and authenticated by the Securities Administrator and delivered by the Trustee,
substantially in the form annexed hereto as Exhibit A-2 and evidencing a Regular
Interest in REMIC III for purposes of the REMIC Provisions.
"Class M-5 Principal Distribution Amount": With respect to any
Distribution Date on or after the Stepdown Date and on which a Trigger Event is
not in effect, the excess of (x) the sum of (i) the aggregate Certificate
Principal Balance of the Class A Certificates (after taking into account the
payment of the Class A Principal Distribution Amount on such Distribution Date),
(ii) the Certificate Principal Balance of the Class M-1 Certificates (after
taking into account the payment of the Class M-1 Principal Distribution Amount
on such Distribution Date), (iii) the Certificate Principal Balance of the Class
M-2 Certificates (after taking into account the payment of the Class M-2
Principal Distribution Amount on such Distribution Date), (iv) the Certificate
Principal Balance of the Class M-3 Certificates (after taking into account the
payment of the Class M-3 Principal Distribution Amount on such Distribution
Date), (v) the Certificate Principal Balance of the Class M-4 Certificates
(after taking into account the payment of the Class M-4 Principal Distribution
Amount on such Distribution Date) and (vi) the Certificate Principal Balance of
the Class M-5 Certificates immediately prior to such Distribution Date over (y)
the lesser of (A) the product of (i) 78.40% and (ii) the aggregate Stated
Principal Balance of the Mortgage Loans as of the last day of the related Due
Period (after giving effect to scheduled payments of principal due during the
related Due Period, to the extent received or advanced and unscheduled
collections of principal received during the related Prepayment Period) and (B)
the aggregate Stated Principal Balance of the Mortgage Loans as of the last day
of the related Due Period (after giving effect to scheduled payments of
principal due during the related Due Period, to the extent received or advanced
and unscheduled collections of principal received during the related Prepayment
Period) minus the product of (i) 0.50% and (ii) the aggregate principal balance
of the Mortgage Loans as of the Cut-off Date.
"Class M-6 Certificate": Any one of the Class M-6 Certificates executed
and authenticated by the Securities Administrator and delivered by the Trustee,
substantially in the form annexed hereto as Exhibit A-2 and evidencing a Regular
Interest in REMIC III for purposes of the REMIC Provisions.
"Class M-6 Principal Distribution Amount": With respect to any
Distribution Date on or after the Stepdown Date and on which a Trigger Event is
not in effect, the excess of (x) the sum of (i) the aggregate Certificate
Principal Balance of the Class A Certificates (after taking into account the
payment of the Class A Principal Distribution Amount on such Distribution Date),
(ii) the Certificate Principal Balance of the Class M-1 Certificates (after
taking into account the payment of the Class M-1 Principal Distribution Amount
on such Distribution Date), (iii) the Certificate Principal Balance of the Class
M-2 Certificates (after taking into account the payment of the Class M-2
Principal Distribution Amount on such Distribution Date), (iv) the Certificate
Principal Balance of the Class M-3 Certificates (after taking into account the
payment of the Class M-3 Principal Distribution Amount on such Distribution
Date), (v) the Certificate Principal Balance of the Class M-4 Certificates
(after taking into account the payment of the Class M-4 Principal Distribution
Amount on such Distribution Date), (vi) the Certificate Principal Balance of the
Class M-5 Certificates (after taking into account the payment of the Class M-5
Principal Distribution Amount on such Distribution Date) and (vii) the
Certificate Principal Balance of the Class M-6 Certificates immediately prior to
such Distribution Date over (y) the lesser of (A) the product of (i) 81.40% and
(ii) the aggregate Stated Principal Balance of the Mortgage Loans as of the last
day of the related Due Period (after giving effect to scheduled payments of
principal due during the related Due Period, to the extent received or advanced
and unscheduled collections of principal received during the related Prepayment
Period) and (B) the aggregate Stated Principal Balance of the Mortgage Loans as
of the last day of the related Due Period (after giving effect to scheduled
payments of principal due during the related Due Period, to the extent received
or advanced and unscheduled collections of principal received during the related
Prepayment Period) minus the product of (i) 0.50% and (ii) the aggregate
principal balance of the Mortgage Loans as of the Cut-off Date.
"Class M-7 Certificate": Any one of the Class M-7 Certificates executed
and authenticated by the Securities Administrator and delivered by the Trustee,
substantially in the form annexed hereto as Exhibit A-2 and evidencing a Regular
Interest in REMIC III for purposes of the REMIC Provisions.
"Class M-7 Principal Distribution Amount": With respect to any
Distribution Date on or after the Stepdown Date and on which a Trigger Event is
not in effect, the excess of (x) the sum of (i) the aggregate Certificate
Principal Balance of the Class A Certificates (after taking into account the
payment of the Class A Principal Distribution Amount on such Distribution Date),
(ii) the Certificate Principal Balance of the Class M-1 Certificates (after
taking into account the payment of the Class M-1 Principal Distribution Amount
on such Distribution Date), (iii) the Certificate Principal Balance of the Class
M-2 Certificates (after taking into account the payment of the Class M-2
Principal Distribution Amount on such Distribution Date), (iv) the Certificate
Principal Balance of the Class M-3 Certificates (after taking into account the
payment of the Class M-3 Principal Distribution Amount on such Distribution
Date), (v) the Certificate Principal Balance of the Class M-4 Certificates
(after taking into account the payment of the Class M-4 Principal Distribution
Amount on such Distribution Date), (vi) the Certificate Principal Balance of the
Class M-5 Certificates (after taking into account the payment of the Class M-5
Principal Distribution Amount on such Distribution Date), (vii) the Certificate
Principal Balance of the Class M-6 Certificates (after taking into account the
payment of the Class M-6 Principal Distribution Amount on such Distribution
Date) and (viii) the Certificate Principal Balance of the Class M-7 Certificates
immediately prior to such Distribution Date over (y) the lesser of (A) the
product of (i) 84.60% and (ii) the aggregate Stated Principal Balance of the
Mortgage Loans as of the last day of the related Due Period (after giving effect
to scheduled payments of principal due during the related Due Period, to the
extent received or advanced and unscheduled collections of principal received
during the related Prepayment Period) and (B) the aggregate Stated Principal
Balance of the Mortgage Loans as of the last day of the related Due Period
(after giving effect to scheduled payments of principal due during the related
Due Period, to the extent received or advanced and unscheduled collections of
principal received during the related Prepayment Period) minus the product of
(i) 0.50% and (ii) the aggregate principal balance of the Mortgage Loans as of
the Cut-off Date.
"Class M-8 Certificate": Any one of the Class M-8 Certificates executed
and authenticated by the Securities Administrator and delivered by the Trustee,
substantially in the form annexed hereto as Exhibit A-2 and evidencing a Regular
Interest in REMIC III for purposes of the REMIC Provisions.
"Class M-8 Principal Distribution Amount": With respect to any
Distribution Date on or after the Stepdown Date and on which a Trigger Event is
not in effect, the excess of (x) the sum of (i) the aggregate Certificate
Principal Balance of the Class A Certificates (after taking into account the
payment of the Class A Principal Distribution Amount on such Distribution Date),
(ii) the Certificate Principal Balance of the Class M-1 Certificates (after
taking into account the payment of the Class M-1 Principal Distribution Amount
on such Distribution Date), (iii) the Certificate Principal Balance of the Class
M-2 Certificates (after taking into account the payment of the Class M-2
Principal Distribution Amount on such Distribution Date), (iv) the Certificate
Principal Balance of the Class M-3 Certificates (after taking into account the
payment of the Class M-3 Principal Distribution Amount on such Distribution
Date), (v) the Certificate Principal Balance of the Class M-4 Certificates
(after taking into account the payment of the Class M-4 Principal Distribution
Amount on such Distribution Date), (vi) the Certificate Principal Balance of the
Class M-5 Certificates (after taking into account the payment of the Class M-5
Principal Distribution Amount on such Distribution Date), (vii) the Certificate
Principal Balance of the Class M-6 Certificates (after taking into account the
payment of the Class M-6 Principal Distribution Amount on such Distribution
Date), (viii) the Certificate Principal Balance of the Class M-7 Certificates
(after taking into account the payment of the Class M-7 Principal Distribution
Amount on such Distribution Date) and (ix) the Certificate Principal Balance of
the Class M-8 Certificates immediately prior to such Distribution Date over (y)
the lesser of (A) the product of (i) 87.00% and (ii) the aggregate Stated
Principal Balance of the Mortgage Loans as of the last day of the related Due
Period (after giving effect to scheduled payments of principal due during the
related Due Period, to the extent received or advanced and unscheduled
collections of principal received during the related Prepayment Period) and (B)
the aggregate Stated Principal Balance of the Mortgage Loans as of the last day
of the related Due Period (after giving effect to scheduled payments of
principal due during the related Due Period, to the extent received or advanced
and unscheduled collections of principal received during the related Prepayment
Period) minus the product of (i) 0.50% and (ii) the aggregate principal balance
of the Mortgage Loans as of the Cut-off Date.
"Class M-9 Certificate": Any one of the Class M-9 Certificates executed
and authenticated by the Securities Administrator and delivered by the Trustee,
substantially in the form annexed hereto as Exhibit A-2 and evidencing a Regular
Interest in REMIC III for purposes of the REMIC Provisions.
"Class M-9 Principal Distribution Amount": With respect to any
Distribution Date on or after the Stepdown Date and on which a Trigger Event is
not in effect, the excess of (x) the sum of (i) the aggregate Certificate
Principal Balance of the Class A Certificates (after taking into account the
payment of the Class A Principal Distribution Amount on such Distribution Date),
(ii) the Certificate Principal Balance of the Class M-1 Certificates (after
taking into account the payment of the Class M-1 Principal Distribution Amount
on such Distribution Date), (iii) the Certificate Principal Balance of the Class
M-2 Certificates (after taking into account the payment of the Class M-2
Principal Distribution Amount on such Distribution Date), (iv) the Certificate
Principal Balance of the Class M-3 Certificates (after taking into account the
payment of the Class M-3 Principal Distribution Amount on such Distribution
Date), (v) the Certificate Principal Balance of the Class M-4 Certificates
(after taking into account the payment of the Class M-4 Principal Distribution
Amount on such Distribution Date), (vi) the Certificate Principal Balance of the
Class M-5 Certificates (after taking into account the payment of the Class M-5
Principal Distribution Amount on such Distribution Date), (vii) the Certificate
Principal Balance of the Class M-6 Certificates (after taking into account the
payment of the Class M-6 Principal Distribution Amount on such Distribution
Date). (viii) the Certificate Principal Balance of the Class M-7 Certificates
(after taking into account the payment of the Class M-7 Principal Distribution
Amount on such Distribution Date), (ix) the Certificate Principal Balance of the
Class M-8 Certificates (after taking into account the payment of the Class M-8
Principal Distribution Amount on such Distribution Date) and (x) the Certificate
Principal Balance of the Class M-9 Certificates immediately prior to such
Distribution Date over (y) the lesser of (A) the product of (i) 89.20% and (ii)
the aggregate Stated Principal Balance of the Mortgage Loans as of the last day
of the related Due Period (after giving effect to scheduled payments of
principal due during the related Due Period, to the extent received or advanced
and unscheduled collections of principal received during the related Prepayment
Period) and (B) the aggregate Stated Principal Balance of the Mortgage Loans as
of the last day of the related Due Period (after giving effect to scheduled
payments of principal due during the related Due Period, to the extent received
or advanced and unscheduled collections of principal received during the related
Prepayment Period) minus the product of (i) 0.50% and (ii) the aggregate
principal balance of the Mortgage Loans as of the Cut-off Date.
"Class M-10 Certificate": Any one of the Class M-10 Certificates
executed and authenticated by the Securities Administrator and delivered by the
Trustee, substantially in the form annexed hereto as Exhibit A-2 and evidencing
a Regular Interest in REMIC III for purposes of the REMIC Provisions.
"Class M-10 Principal Distribution Amount": With respect to any
Distribution Date on or after the Stepdown Date and on which a Trigger Event is
not in effect, the excess of (x) the sum of (i) the aggregate Certificate
Principal Balance of the Class A Certificates (after taking into account the
payment of the Class A Principal Distribution Amount on such Distribution Date),
(ii) the Certificate Principal Balance of the Class M-1 Certificates (after
taking into account the payment of the Class M-1 Principal Distribution Amount
on such Distribution Date), (iii) the Certificate Principal Balance of the Class
M-2 Certificates (after taking into account the payment of the Class M-2
Principal Distribution Amount on such Distribution Date), (iv) the Certificate
Principal Balance of the Class M-3 Certificates (after taking into account the
payment of the Class M-3 Principal Distribution Amount on such Distribution
Date), (v) the Certificate Principal Balance of the Class M-4 Certificates
(after taking into account the payment of the Class M-4 Principal Distribution
Amount on such Distribution Date), (vi) the Certificate Principal Balance of the
Class M-5 Certificates (after taking into account the payment of the Class M-5
Principal Distribution Amount on such Distribution Date), (vii) the Certificate
Principal Balance of the Class M-6 Certificates (after taking into account the
payment of the Class M-6 Principal Distribution Amount on such Distribution
Date). (viii) the Certificate Principal Balance of the Class M-7 Certificates
(after taking into account the payment of the Class M-7 Principal Distribution
Amount on such Distribution Date), (ix) the Certificate Principal Balance of the
Class M-8 Certificates (after taking into account the payment of the Class M-8
Principal Distribution Amount on such Distribution Date), (x) the Certificate
Principal Balance of the Class M-9 Certificates (after taking into account the
payment of the Class M-9 Principal Distribution Amount on such Distribution
Date) and (xi) the Certificate Principal Balance of the Class M-10 Certificates
immediately prior to such Distribution Date over (y) the lesser of (A) the
product of (i) 91.30% and (ii) the aggregate Stated Principal Balance of the
Mortgage Loans as of the last day of the related Due Period (after giving effect
to scheduled payments of principal due during the related Due Period, to the
extent received or advanced and unscheduled collections of principal received
during the related Prepayment Period) and (B) the aggregate Stated Principal
Balance of the Mortgage Loans as of the last day of the related Due Period
(after giving effect to scheduled payments of principal due during the related
Due Period, to the extent received or advanced and unscheduled collections of
principal received during the related Prepayment Period) minus the product of
(i) 0.50% and (ii) the aggregate principal balance of the Mortgage Loans as of
the Cut-off Date.
"Class M-11 Principal Distribution Amount": With respect to any
Distribution Date on or after the Stepdown Date and on which a Trigger Event is
not in effect, the excess of (x) the sum of (i) the aggregate Certificate
Principal Balance of the Class A Certificates (after taking into account the
payment of the Class A Principal Distribution Amount on such Distribution Date),
(ii) the Certificate Principal Balance of the Class M-1 Certificates (after
taking into account the payment of the Class M-1 Principal Distribution Amount
on such Distribution Date), (iii) the Certificate Principal Balance of the Class
M-2 Certificates (after taking into account the payment of the Class M-2
Principal Distribution Amount on such Distribution Date), (iv) the Certificate
Principal Balance of the Class M-3 Certificates (after taking into account the
payment of the Class M-3 Principal Distribution Amount on such Distribution
Date), (v) the Certificate Principal Balance of the Class M-4 Certificates
(after taking into account the payment of the Class M-4 Principal Distribution
Amount on such Distribution Date), (vi) the Certificate Principal Balance of the
Class M-5 Certificates (after taking into account the payment of the Class M-5
Principal Distribution Amount on such Distribution Date), (vii) the Certificate
Principal Balance of the Class M-6 Certificates (after taking into account the
payment of the Class M-6 Principal Distribution Amount on such Distribution
Date), (viii) the Certificate Principal Balance of the Class M-7 Certificates
(after taking into account the payment of the Class M-7 Principal Distribution
Amount on such Distribution Date), (ix) the Certificate Principal Balance of the
Class M-8 Certificates (after taking into account the payment of the Class M-8
Principal Distribution Amount on such Distribution Date), (x) the Certificate
Principal Balance of the Class M-9 Certificates (after taking into account the
payment of the Class M-9 Principal Distribution Amount on such Distribution
Date), (xi) the Certificate Principal Balance of the Class M-10 Certificates
(after taking into account the payment of the Class M-10 Principal Distribution
Amount on such Distribution Date) and (xii) the Certificate Principal Balance of
the Class M-11 Certificates immediately prior to such Distribution Date over (y)
the lesser of (A) the product of (i) 93.30% and (ii) the aggregate Stated
Principal Balance of the Mortgage Loans as of the last day of the related Due
Period (after giving effect to scheduled payments of principal due during the
related Due Period, to the extent received or advanced and unscheduled
collections of principal received during the related Prepayment Period) and (B)
the aggregate Stated Principal Balance of the Mortgage Loans as of the last day
of the related Due Period (after giving effect to scheduled payments of
principal due during the related Due Period, to the extent received or advanced
and unscheduled collections of principal received during the related Prepayment
Period) minus the product of (i) 0.50% and (ii) the aggregate principal balance
of the Mortgage Loans as of the Cut-off Date.
"Class P Certificate": Any one of the Class P Certificates executed and
authenticated by the Securities Administrator and delivered by the Trustee,
substantially in the form annexed hereto as Exhibit A-4 and evidencing a Regular
Interest in REMIC III for purposes of the REMIC Provisions.
"Class R Certificates": Any one of the Class R Certificates executed
and authenticated by the Securities Administrator and delivered by the Trustee,
substantially in the form annexed hereto as Exhibit A-5, and evidencing the
Class R-I Interest, the Class R-II Interest and the Class R-III Interest.
"Class R-I Interest": The uncertificated residual interest in REMIC I.
"Class R-II Interest": The uncertificated residual interest in REMIC
II.
"Class R-III Interest": The uncertificated residual interest in REMIC
III.
"Closing Date": November 28, 2005.
"Code": The Internal Revenue Code of 1986 as amended from time to time.
"Collection Account": The separate account or accounts created and
maintained, or caused to be created and maintained, by ▇▇▇▇▇ Fargo pursuant to
Section 3.08(a) of this Agreement, which shall be entitled "▇▇▇▇▇ Fargo Bank,
National Association, as a Servicer for HSBC Bank USA, National Association as
Trustee, in trust for the registered Holders of ACE Securities Corp., Home
Equity Loan Trust, Series 2005-HE7, Asset Backed Pass-Through Certificates",
respectively. The Collection Accounts must be Eligible Accounts.
"Commission": The Securities and Exchange Commission.
"Corporate Trust Office": The principal corporate trust office of the
Trustee or the Securities Administrator, as the case may be, at which, at any
particular time, its corporate trust business in connection with this Agreement
shall be administered, which office at the date of the execution of this
instrument is located at (i) with respect to the Trustee, HSBC Bank USA,
National Association, ▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇, Attention: ACE
Securities Corp., 2005-HE7, or at such other address as the Trustee may
designate from time to time by notice to the Certificateholders, the Depositor,
the Master Servicer, the Securities Administrator and the Servicer and (ii) with
respect to the Securities Administrator, (A) for purposes of Certificate
transfers and surrender, ▇▇▇▇▇ Fargo Bank, National Association, ▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇ ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇, Attention: Corporate Trust
(ACE 2005-HE7), and (B) for all other purposes, ▇▇▇▇▇ Fargo Bank, National
Association, ▇.▇. ▇▇▇ ▇▇, ▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇ ▇▇▇▇▇, Attention: Corporate Trust
(ACE 2005-HE7) (or for overnight deliveries, at ▇▇▇▇ ▇▇▇ ▇▇▇▇▇▇▇▇▇ ▇▇▇▇,
▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇ ▇▇▇▇▇, Attention: Corporate Trust (ACE 2005-HE7)), or at such
other address as the Securities Administrator may designate from time to time by
notice to the Certificateholders, the Depositor, the Master Servicer, the
Servicer and the Trustee.
"Corresponding Certificate": With respect to each REMIC II Regular
Interest, as follows:
REMIC II Regular Interest Class
------------------------- -----
REMIC II Regular Interest A-1A A-1A
REMIC II Regular Interest A-1B1 A-1B1
REMIC II Regular Interest A-1B2 A-1B2
REMIC II Regular Interest A-2A A-2A
REMIC II Regular Interest A-2B A-2B
REMIC II Regular Interest A-2C A-2C
REMIC II Regular Interest A-2D A-2D
REMIC II Regular Interest M-1 M-1
REMIC II Regular Interest M-2 M-2
REMIC II Regular Interest M-3 M-3
REMIC II Regular Interest M-4 M-4
REMIC II Regular Interest M-5 M-5
REMIC II Regular Interest M-6 M-6
REMIC II Regular Interest M-7 M-7
REMIC II Regular Interest M-8 M-8
REMIC II Regular Interest M-9 M-9
REMIC II Regular Interest M-10 M-10
REMIC II Regular Interest M-11 M-11
REMIC II Regular Interest P P
"Countrywide": Countrywide Home Loans Servicing LP or any successor
thereto.
"Countrywide Mortgage Loans": Those Mortgage Loans serviced by
Countrywide pursuant to the terms of the Servicing Agreement as specified on the
Mortgage Loan Schedule.
"Credit Enhancement Percentage": For any Distribution Date, the
percentage equivalent of a fraction, the numerator of which is the sum of the
aggregate Certificate Principal Balances of the Mezzanine Certificates and the
Class CE Certificates, and the denominator of which is the aggregate Stated
Principal Balance of the Mortgage Loans, calculated after taking into account
distributions of principal on the Mortgage Loans and distribution of the
Principal Distribution Amount to the Certificates then entitled to distributions
of principal on such Distribution Date.
"Credit Risk Management Agreements": The agreements between the Credit
Risk Manager and each Servicer and/or Master Servicer, each regarding the loss
mitigation and advisory services to be provided by the Credit Risk Manager.
"Credit Risk Management Fee": The amount payable to the Credit Risk
Manager on each Distribution Date as compensation for all services rendered by
it in the exercise and performance of any and all powers and duties of the
Credit Risk Manager under the Credit Risk Management Agreements, which amount
shall equal one twelfth of the product of (i) the Credit Risk Management Fee
Rate multiplied by (ii) the Stated Principal Balance of the Mortgage Loans and
any related REO Properties as of the first day of the related Due Period.
"Credit Risk Management Fee Rate": 0.013% per annum.
"Credit Risk Manager": ▇▇▇▇▇▇▇ Fixed Income Services Inc. (formerly
known as The Murrayhill Company), a Colorado corporation, and its successors and
assigns.
"Custodial Account": The separate account or accounts maintained by
Countrywide pursuant to the Servicing Agreement.
"Custodial Agreement": Either of the DBNT Custodial Agreement or the
▇▇▇▇▇ Fargo Custodial Agreement, or any other custodial agreement entered into
after the date hereof with respect to any Mortgage Loan subject to this
Agreement.
"Custodian": Either ▇▇▇▇▇ Fargo or DBNT or any other custodian
appointed under any custodial agreement entered into after the date of this
Agreement.
"Cut-off Date": With respect to each Mortgage Loan, November 1, 2005.
With respect to all Qualified Substitute Mortgage Loans, their respective dates
of substitution. References herein to the "Cut-off Date," when used with respect
to more than one Mortgage Loan, shall be to the respective Cut-off Dates for
such Mortgage Loans.
"DBNT": Deutsche Bank National Trust Company, a national banking
association, or its successor in interest.
"DBNT Custodial Agreement": The Custodial Agreement dated as of
November 1, 2005, among the Trustee, DBNT and the Servicers, as may be amended
or supplemented from time to time.
"Debt Service Reduction": With respect to any Mortgage Loan, a
reduction in the scheduled Monthly Payment for such Mortgage Loan by a court of
competent jurisdiction in a proceeding under the Bankruptcy Code, except such a
reduction resulting from a Deficient Valuation.
"Deficient Valuation": With respect to any Mortgage Loan, a valuation
of the related Mortgaged Property by a court of competent jurisdiction in an
amount less than the then outstanding principal balance of the Mortgage Loan,
which valuation results from a proceeding initiated under the Bankruptcy Code.
"Definitive Certificates": As defined in Section 6.01(b) of this
Agreement.
"Deleted Mortgage Loan": A Mortgage Loan replaced or to be replaced by
a Qualified Substitute Mortgage Loan.
"Delinquency Percentage": As of the last day of the related Due Period,
the percentage equivalent of a fraction, the numerator of which is the aggregate
Stated Principal Balance of all Mortgage Loans that, as of the last day of the
previous calendar month, are sixty (60) or more days delinquent, are in
foreclosure, have been converted to REO Properties or have been discharged by
reason of bankruptcy, and the denominator of which is the aggregate Stated
Principal Balance of the Mortgage Loans and REO Properties as of the last day of
the previous calendar month.
"Depositor": ACE Securities Corp., a Delaware corporation, or its
successor in interest.
"Depository": The Depository Trust Company, or any successor Depository
hereafter named. The nominee of the initial Depository, for purposes of
registering those Certificates that are to be Book-Entry Certificates, is Cede &
Co. The Depository shall at all times be a "clearing corporation" as defined in
Section 8-102(3) of the Uniform Commercial Code of the State of New York and a
"clearing agency" registered pursuant to the provisions of Section 17A of the
Exchange Act.
"Depository Institution": Any depository institution or trust company,
including the Trustee, that (a) is incorporated under the laws of the United
States of America or any State thereof, (b) is subject to supervision and
examination by federal or state banking authorities and (c) has outstanding
unsecured commercial paper or other short-term unsecured debt obligations (or,
in the case of a depository institution that is the principal subsidiary of a
holding company, such holding company has unsecured commercial paper or other
short-term unsecured debt obligations) that are rated at least A-1+ by S&P and
P-1 by ▇▇▇▇▇'▇ (or, if such Rating Agencies are no longer rating the Offered
Certificates, comparable ratings by any other nationally recognized statistical
rating agency then rating the Offered Certificates).
"Depository Participant": A broker, dealer, bank or other financial
institution or other Person for whom from time to time a Depository effects
book-entry transfers and pledges of securities deposited with the Depository.
"Determination Date": With respect to each Distribution Date and (i)
▇▇▇▇▇ Fargo, the Business Day immediately preceding the related Servicer
Remittance Date and (ii) Countrywide, the date specified in the Servicing
Agreement. The Determination Date for purposes of Article X hereof shall mean
the 15th day of the month or, if such 15th day is not a Business Day, the first
Business Day following such 15th day.
"Directly Operate": With respect to any REO Property, the furnishing or
rendering of services to the tenants thereof, the management or operation of
such REO Property, the holding of such REO Property primarily for sale to
customers, the performance of any construction work thereon or any use of such
REO Property in a trade or business conducted by REMIC I other than through an
Independent Contractor; provided, however, that the related Servicer, on behalf
of the Trustee, shall not be considered to Directly Operate an REO Property
solely because the related Servicer establishes rental terms, chooses tenants,
enters into or renews leases, deals with taxes and insurance, or makes decisions
as to repairs or capital expenditures with respect to such REO Property.
"Disqualified Organization": Any of the following: (i) the United
States, any State or political subdivision thereof, any possession of the United
States, or any agency or instrumentality of any of the foregoing (other than an
instrumentality which is a corporation if all of its activities are subject to
tax and, except for ▇▇▇▇▇▇▇ Mac, a majority of its board of directors is not
selected by such governmental unit), (ii) any foreign government, any
international organization, or any agency or instrumentality of any of the
foregoing, (iii) any organization (other than certain farmers' cooperatives
described in Section 521 of the Code) which is exempt from the tax imposed by
Chapter 1 of the Code (including the tax imposed by Section 511 of the Code on
unrelated business taxable income), (iv) rural electric and telephone
cooperatives described in Section 1381(a)(2)(C) of the Code, (v) an "electing
large partnership" and (vi) any other Person so designated by the Trustee based
upon an Opinion of Counsel that the holding of an Ownership Interest in a
Residual Certificate by such Person may cause any Trust REMIC or any Person
having an Ownership Interest in any Class of Certificates (other than such
Person) to incur a liability for any federal tax imposed under the Code that
would not otherwise be imposed but for the Transfer of an Ownership Interest in
a Residual Certificate to such Person. The terms "United States," "State" and
"international organization" shall have the meanings set forth in Section 7701
of the Code or successor provisions.
"Distribution Account": The separate trust account or accounts created
and maintained by the Securities Administrator pursuant to Section 3.08(b) of
this Agreement in the name of the Securities Administrator for the benefit of
the Certificateholders and designated "▇▇▇▇▇ Fargo Bank, National Association,
in trust for registered holders of ACE Securities Corp. Home Equity Loan Trust,
Series 2005-HE7". Funds in the Distribution Account shall be held in trust for
the Certificateholders for the uses and purposes set forth in this Agreement.
The Distribution Account must be an Eligible Account.
"Distribution Date": The 25th day of any month, or if such 25th day is
not a Business Day, the Business Day immediately following such 25th day,
commencing in December 2005.
"Due Date": With respect to each Distribution Date, the day of the
month on which the Monthly Payment is due on a Mortgage Loan during the related
Due Period, exclusive of any days of grace.
"Due Period": With respect to any Distribution Date, the period
commencing on the second day of the month immediately preceding the month in
which such Distribution Date occurs and ending on the first day of the month in
which such Distribution Date occurs.
"Eligible Account": Any of (i) an account or accounts maintained with a
Depository Institution, (ii) an account or accounts the deposits in which are
fully insured by the FDIC or (iii) a trust account or accounts maintained with a
federal depository institution or state chartered depository institution acting
in its fiduciary capacity. Eligible Accounts may bear interest.
"ERISA": The Employee Retirement Income Security Act of 1974, as
amended from time to time.
"Estate in Real Property": A fee simple estate in a parcel of land.
"Excess Liquidation Proceeds": To the extent that such amount is not
required by law to be paid to the related Mortgagor, the amount, if any, by
which Liquidation Proceeds with respect to a liquidated Mortgage Loan exceed the
sum of (i) the outstanding principal balance of such Mortgage Loan and accrued
but unpaid interest at the related Net Mortgage Rate through the last day of the
month in which the related Liquidation Event occurs, plus (ii) related
liquidation expenses or other amounts to which the related Servicer is entitled
to be reimbursed from Liquidation Proceeds with respect to such liquidated
Mortgage Loan pursuant to Section 3.09 of this Agreement.
"Exchange Act": The Securities Exchange Act of 1934, as amended.
"Extraordinary Trust Fund Expense": Any amounts payable or reimbursable
to the Trustee, the Master Servicer, the Securities Administrator, the
Custodians or any director, officer, employee or agent of any such Person from
the Trust Fund pursuant to the terms of this Agreement and any amounts payable
from the Distribution Account in respect of taxes pursuant to Section
11.01(g)(v) of this Agreement or pursuant to the Servicing Agreement.
"Extra Principal Distribution Amount": With respect to any Distribution
Date, the lesser of (i) the Net Monthly Excess Cashflow for such Distribution
Date and (ii) the Overcollateralization Increase Amount for such Distribution
Date.
"▇▇▇▇▇▇ ▇▇▇": ▇▇▇▇▇▇ ▇▇▇, formerly known as the Federal National
Mortgage Association, or any successor thereto.
"FDIC": Federal Deposit Insurance Corporation or any successor thereto.
"Final Maturity Date": The Distribution Date occurring in November
2035.
"Final Recovery Determination": With respect to any defaulted Mortgage
Loan or any REO Property (other than a Mortgage Loan or REO Property purchased
by an originator, the Seller or the Master Servicer pursuant to or as
contemplated by Section 2.03, 3.13(c) or Section 10.01 of this Agreement), a
determination made by the related Servicer that all Insurance Proceeds,
Liquidation Proceeds and other payments or recoveries which the related
Servicer, in its reasonable good faith judgment, expects to be finally
recoverable in respect thereof have been so recovered, which determination shall
be evidenced by a certificate of a Servicing Officer of the related Servicer
delivered to the Master Servicer and maintained in its records.
"▇▇▇▇▇▇▇ Mac": ▇▇▇▇▇▇▇ Mac, formerly known as the Federal Home Loan
Mortgage Corporation, or any successor thereto.
"Gross Margin": With respect to each Adjustable Rate Mortgage Loan, the
fixed percentage set forth in the related Mortgage Note that is added to the
Index on each Adjustment Date in accordance with the terms of the related
Mortgage Note used to determine the Mortgage Rate for such Adjustable Rate
Mortgage Loan.
"Group IA Allocation Percentage": The aggregate principal balance of
the Group IA Mortgage Loans divided by the sum of the aggregate principal
balance of the Group IA Mortgage Loans, Group IB Mortgage Loans and Group II
Mortgage Loans.
"Group IA Interest Remittance Amount": With respect to any Distribution
Date is that portion of the Available Distribution Amount for such Distribution
Date that represents interest received or advanced on the Group IA Mortgage
Loans (other than any Simple Interest Excess, if applicable, and net of the
Administration Fees and any Prepayment Charges and after taking into account
amounts payable or reimbursable to the Trustee, the Custodians, the Securities
Administrator, the Credit Risk Manager, the Master Servicer or the Servicers
pursuant to this Agreement or the Custodial Agreements), plus any amounts
withdrawn from the Simple Interest Excess Sub-Account.
"Group IA Mortgage Loans": Those Mortgage Loans identified on the
Mortgage Loan Schedule as Group IA Mortgage Loans.
"Group IA Principal Distribution Amount": With respect to any
Distribution Date will be the sum of (i) the principal portion of all Monthly
Payments on the Group IA 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
Group IA Mortgage Loan or, in the case of a substitution, certain amounts
representing a principal adjustment, during the related Prepayment Period
pursuant to or as contemplated by Section 2.03, Section 3.13(c) and Section
10.01 of this Agreement; (iii) the principal portion of all other unscheduled
collections, including Insurance Proceeds, Liquidation Proceeds and all
Principal Prepayments in full and in part, received during the related
Prepayment Period, to the extent applied as recoveries of principal on the Group
IA Mortgage Loans, net in each case of payments or reimbursements to the
Trustee, the Custodians, the Master Servicer, the Securities Administrator or
the Servicers and (iv) the Class A-1A Allocation Percentage of the amount of any
Overcollateralization Increase Amount for such Distribution Date MINUS (v) the
Class A-1A Allocation Percentage of the amount of any Overcollateralization
Reduction Amount for such Distribution Date.
"Group IA Principal Remittance Amount": With respect to any
Distribution Date will be the sum of (a) the amounts described in clauses (i)
through (iii) of the definition of Group IA Principal Distribution Amount.
"Group IB Allocation Percentage": The aggregate principal balance of
the Group IB Mortgage Loans divided by the sum of the aggregate principal
balance of the Group IA Mortgage Loans, Group IB Mortgage Loans and Group II
Mortgage Loans.
"Group IB Interest Remittance Amount": With respect to any Distribution
Date is that portion of the Available Distribution Amount for such Distribution
Date that represents interest received or advanced on the Group IB Mortgage
Loans (other than any Simple Interest Excess, if applicable, and net of the
Administration Fees and any Prepayment Charges and after taking into account
amounts payable or reimbursable to the Trustee, the Custodians, the Securities
Administrator, the Master Servicer or the Servicers pursuant to this Agreement
or the Custodial Agreements), plus any amounts withdrawn from the Simple
Interest Excess Sub-Account.
"Group IB Mortgage Loans": Those Mortgage Loans identified on the
Mortgage Loan Schedule as Group IB Mortgage Loans.
"Group IB Principal Distribution Amount": With respect to any
Distribution Date will be the sum of (i) the principal portion of all Monthly
Payments on the Group IB 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
Group IB Mortgage Loan or, in the case of a substitution, certain amounts
representing a principal adjustment, during the related Prepayment Period
pursuant to or as contemplated by Section 2.03, Section 3.13(c) and Section
10.01 of this Agreement; (iii) the principal portion of all other unscheduled
collections, including Insurance Proceeds, Liquidation Proceeds and all
Principal Prepayments in full and in part, received during the related
Prepayment Period, to the extent applied as recoveries of principal on the Group
IB Mortgage Loans, net in each case of payments or reimbursements to the
Trustee, the Custodians, the Master Servicer, the Securities Administrator or
the Servicers and (iv) the Class A-1B Allocation Percentage of the amount of any
Overcollateralization Increase Amount for such Distribution Date MINUS (v) the
Class A-1B Allocation Percentage of the amount of any Overcollateralization
Reduction Amount for such Distribution Date.
"Group IB Principal Remittance Amount": With respect to any
Distribution Date will be the sum of the amounts described in clauses (i)
through (iii) of the definition of Group IB Principal Distribution Amount.
"Group II Allocation Percentage": The aggregate principal balance of
the Group II Mortgage Loans divided by the sum of the aggregate principal
balance of the Group IA Mortgage Loans, Group IB Mortgage Loans and Group II
Mortgage Loans.
"Group II Interest Remittance Amount": With respect to any Distribution
Date is that portion of the Available Distribution Amount for such Distribution
Date that represents interest received or advanced on the Group II Mortgage
Loans (other than any Simple Interest Excess, if applicable, and net of the
Administration Fees and any Prepayment Charges and after taking into account
amounts payable or reimbursable to the Trustee, the Custodians, the Securities
Administrator, the Credit Risk Manager, the Master Servicer or the Servicers
pursuant to this Agreement or the Custodial Agreements), plus any amounts
withdrawn from the Simple Interest Excess Sub-Account.
"Group II Mortgage Loans": Those Mortgage Loans identified on the
Mortgage Loan Schedule as Group II Mortgage Loans.
"Group II Principal Distribution Amount": With respect to any
Distribution Date will be the sum of (i) the principal portion of all Monthly
Payments on the Group II 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
Group II Mortgage Loan or, in the case of a substitution, certain amounts
representing a principal adjustment, during the related Prepayment Period
pursuant to or as contemplated by Section 2.03, Section 3.13(c) and Section
10.01 of this Agreement; (iii) the principal portion of all other unscheduled
collections, including Insurance Proceeds, Liquidation Proceeds and all
Principal Prepayments in full and in part, received during the related
Prepayment Period, to the extent applied as recoveries of principal on the Group
II Mortgage Loans, net in each case of payments or reimbursements to the
Trustee, the Custodians, the Master Servicer, the Securities Administrator or
the Servicers and (iv) the Class A-2 Allocation Percentage of the amount of any
Overcollateralization Increase Amount for such Distribution Date MINUS (v) the
Class A-2 Allocation Percentage of the amount of any Overcollateralization
Reduction Amount for such Distribution Date.
"Group II Principal Remittance Amount": With respect to any
Distribution Date will be the sum of the amounts described in clauses (i)
through (iii) of the definition of Group II Principal Distribution Amount.
"Independent": When used with respect to any specified Person, any such
Person who (a) is in fact independent of the Depositor, the Master Servicer, the
Securities Administrator, the Servicers, the Seller, any originator and their
respective Affiliates, (b) does not have any direct financial interest in or any
material indirect financial interest in the Depositor, the Master Servicer, the
Securities Administrator, the Servicers, the Seller, any originator or any
Affiliate thereof, and (c) is not connected with the Depositor, the Master
Servicer, the Securities Administrator, the Servicers, the Seller, any
originator or any Affiliate thereof as an officer, employee, promoter,
underwriter, trustee, partner, director or Person performing similar functions;
provided, however, that a Person shall not fail to be Independent of the
Depositor, the Master Servicer, the Securities Administrator, the Servicers, the
Seller, any originator or any Affiliate thereof merely because such Person is
the beneficial owner of 1% or less of any class of securities issued by the
Depositor, the Master Servicer, the Securities Administrator, the Servicers, the
Seller, any originator or any Affiliate thereof, as the case may be.
"Independent Contractor": Either (i) any Person (other than a Servicer)
that would be an "independent contractor" with respect to REMIC I within the
meaning of Section 856(d)(3) of the Code if REMIC I were a real estate
investment trust (except that the ownership tests set forth in that section
shall be considered to be met by any Person that owns, directly or indirectly,
35% or more of any Class of Certificates), so long as REMIC I does not receive
or derive any income from such Person and provided that the relationship between
such Person and REMIC I is at arm's length, all within the meaning of Treasury
Regulation Section 1.856-4(b)(5), or (ii) any other Person (including any
Servicer) if the Trustee has received an Opinion of Counsel to the effect that
the taking of any action in respect of any REO Property by such Person, subject
to any conditions therein specified, that is otherwise herein contemplated to be
taken by an Independent Contractor will not cause such REO Property to cease to
qualify as "foreclosure property" within the meaning of Section 860G(a)(8) of
the Code (determined without regard to the exception applicable for purposes of
Section 860D(a) of the Code), or cause any income realized in respect of such
REO Property to fail to qualify as Rents from Real Property.
"Index": As of any Adjustment Date, the index applicable to the
determination of the Mortgage Rate on each Adjustable Rate Mortgage Loan will
generally be the average of the interbank offered rates for six-month United
States dollar deposits in the London market as published in THE WALL STREET
JOURNAL and as most recently available either (a) as of the first Business Day
forty-five (45) days prior to such Adjustment Date or (b) as of the first
Business Day of the month preceding the month of such Adjustment Date, as
specified in the related Mortgage Note.
"Institutional Accredited Investor": As defined in Section 6.01(c).
"Insurance Proceeds": Proceeds of any title policy, hazard policy or
other insurance policy, covering a Mortgage Loan or the related Mortgaged
Property, to the extent such proceeds are not to be applied to the restoration
of the related Mortgaged Property or released to the Mortgagor or a senior
lienholder in accordance with Accepted Servicing Practices, subject to the terms
and conditions of the related Mortgage Note and Mortgage.
"Interest Accrual Period": With respect to any Distribution Date and
the Class A Certificates and the Mezzanine Certificates, the period commencing
on the Distribution Date of the month immediately preceding the month in which
such Distribution Date occurs (or, in the case of the first Distribution Date,
commencing on the Closing Date) and ending on the day preceding such
Distribution Date. With respect to any Distribution Date and the Class CE
Certificates and the REMIC I Regular Interests, the one-month period ending on
the last day of the calendar month immediately preceding the month in which such
Distribution Date occurs.
"Interest Carry Forward Amount": With respect to any Distribution Date
and any Class A Certificate or Mezzanine Certificate, the sum of (i) the amount,
if any, by which (a) the Interest Distribution Amount for such Class as of the
immediately preceding Distribution Date exceeded (b) the actual amount
distributed on such Class in respect of interest on such immediately preceding
Distribution Date and (ii) the amount of any Interest Carry Forward Amount for
such Class remaining unpaid from the previous Distribution Date, plus accrued
interest on such sum calculated at the related Pass-Through Rate for the most
recently ended Interest Accrual Period.
"Interest Determination Date": With respect to the Class A
Certificates, the Mezzanine Certificates, REMIC I Regular Interests and REMIC II
Regular Interests (other than REMIC I Regular Interest P and REMIC II Regular
Interest P) and any Interest Accrual Period therefor, the second London Business
Day preceding the commencement of such Interest Accrual Period.
"Interest Distribution Amount": With respect to any Distribution Date
and any Class A Certificates, any Mezzanine Certificates and any Class CE
Certificates, the aggregate Accrued Certificate Interest on the Certificates of
such Class for such Distribution Date.
"Interest Remittance Amount": With respect to any Distribution Date,
the sum of: (i) the Group IA Interest Remittance Amount, (ii) the Group IB
Interest Remittance Amount and (iii) the Group II Interest Remittance Amount.
"Last Scheduled Distribution Date": The Distribution Date in November
2035, which is the Distribution Date immediately following the maturity date for
the Mortgage Loan with the latest maturity date.
"Late Collections": With respect to any Mortgage Loan and any Due
Period, all amounts received subsequent to the Determination Date immediately
following such Due Period with respect to such Mortgage Loan, whether as late
payments of Monthly Payments or as Insurance Proceeds, Liquidation Proceeds or
otherwise, which represent late payments or collections of principal and/or
interest due (without regard to any acceleration of payments under the related
Mortgage and Mortgage Note) but delinquent for such Due Period and not
previously recovered.
"Liquidation Event": With respect to any Mortgage Loan, any of the
following events: (i) such Mortgage Loan is paid in full; (ii) a Final Recovery
Determination is made as to such Mortgage Loan or (iii) such Mortgage Loan is
removed from REMIC I by reason of its being purchased, sold or replaced pursuant
to or as contemplated by Section 2.03, Section 3.13(c) or Section 10.01 of this
Agreement. With respect to any REO Property, either of the following events: (i)
a Final Recovery Determination is made as to such REO Property or (ii) such REO
Property is removed from REMIC I by reason of its being purchased pursuant to
Section 10.01 of this Agreement.
"Liquidation Proceeds": The amount (other than Insurance Proceeds,
amounts received in respect of the rental of any REO Property prior to REO
Disposition, or required to be released to a Mortgagor or a senior lienholder in
accordance with applicable law or the terms of the related Mortgage Loan
Documents) received by the related Servicer in connection with (i) the taking of
all or a part of a Mortgaged Property by exercise of the power of eminent domain
or condemnation (other than amounts required to be released to the Mortgagor or
a senior lienholder), (ii) the liquidation of a defaulted Mortgage Loan through
a trustee's sale, foreclosure sale or otherwise, (iii) the repurchase,
substitution or sale of a Mortgage Loan or an REO Property pursuant to or as
contemplated by Section 2.03, Section 3.13(c), Section 3.21 or Section 10.01 of
this Agreement pursuant to the Servicing Agreement or (iv) any Subsequent
Recoveries.
"Loan-to-Value Ratio": As of 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 and the denominator of which is the Value
of the related Mortgaged Property.
"London Business Day": Any day on which banks in the Cities of London
and New York are open and conducting transactions in United States dollars.
"Loss Severity Percentage": With respect to any Distribution Date, the
percentage equivalent of a fraction, the numerator of which is the amount of
Realized Losses incurred on a Mortgage Loan and the denominator of which is the
principal balance of such Mortgage Loan immediately prior to the liquidation of
such Mortgage Loan.
"Marker Rate": With respect to the Class CE Certificates and any
Distribution Date, a per annum rate equal to two (2) times the weighted average
of the REMIC II Remittance Rate for each of REMIC II Regular Interest A-1A,
REMIC II Regular Interest A-1B1, REMIC II Regular Interest A-1B2, REMIC II
Regular Interest A-2A, REMIC II Regular Interest A-2B, REMIC II Regular Interest
A-2C, REMIC II Regular Interest A-2D, REMIC II Regular Interest M-1, REMIC II
Regular Interest M-2, REMIC II Regular Interest M-3, REMIC II Regular Interest
M-4, REMIC II Regular Interest M-5, REMIC II Regular Interest M-6, REMIC II
Regular Interest M-7, REMIC II Regular Interest M-8, REMIC II Regular Interest
M-9, REMIC II Regular Interest M-10, REMIC II Regular Interest M-11, and REMIC
II Regular Interest ZZ, with the rate on each such REMIC II Regular Interest
(other than REMIC II Regular Interest ZZ) subject to a cap equal to the lesser
of (i) the related One-Month LIBOR Pass-Through Rate and (ii) the related Net
WAC Pass-Through Rate for the corresponding Certificate for the purpose of this
calculation for such Distribution Date and with the rate on REMIC II Regular
Interest ZZ subject to a cap of zero for the purpose of this calculation;
provided however, each such cap for each REMIC II Regular Interest shall be
multiplied by a fraction the numerator of which is the actual number of days in
the related Interest Accrual Period and the denominator of which is 30.
"Master Servicer": As of the Closing Date, ▇▇▇▇▇ Fargo Bank, National
Association and thereafter, its respective successors in interest who meet the
qualifications of this Agreement. The Master Servicer and the Securities
Administrator shall at all times be the same Person or an Affiliate.
"Master Servicer Certification": A written certification covering the
servicing of the Mortgage Loans by a Servicer and signed by an officer of the
Master Servicer that complies with (i) the ▇▇▇▇▇▇▇▇-▇▇▇▇▇ Act of 2002, as
amended from time to time, and (ii) the February 21, 2003 Statement by the Staff
of the Division of Corporation Finance of the Securities and Exchange Commission
Regarding Compliance by Asset-Backed Issuers with Exchange Act Rules 13a-14 and
15d-14, as in effect from time to time; provided that if, after the Closing Date
(a) the ▇▇▇▇▇▇▇▇-▇▇▇▇▇ Act of 2002 is amended, (b) the Statement referred to in
clause (ii) is modified or superseded by any subsequent statement, rule or
regulation of the Securities and Exchange Commission or any statement of a
division thereof, or (c) any future releases, rules and regulations are
published by the Securities and Exchange Commission from time to time pursuant
to the ▇▇▇▇▇▇▇▇-▇▇▇▇▇ Act of 2002, which in any such case affects the form or
substance of the required certification and results in the required
certification being, in the reasonable judgment of the Master Servicer,
materially more onerous than the form of the required certification as of the
Closing Date, the Master Servicer Certification shall be as agreed to by the
Master Servicer, the Depositor and the Seller following a negotiation in good
faith to determine how to comply with any such new requirements.
"Master Servicer Event of Default": One or more of the events described
in Section 8.01(b) of this Agreement.
"Master Servicing Fee": With respect to each Mortgage Loan and for any
calendar month, an amount equal to one twelfth of the product of the Master
Servicing Fee Rate multiplied by the Scheduled Principal Balance of the Mortgage
Loans as of the Due Date in the preceding calendar month.
"Master Servicing Fee Rate": 0.0015% per annum.
"Maximum ZZ Uncertificated Interest Deferral Amount": With respect to
any Distribution Date, the excess of (i) accrued interest at the REMIC II
Remittance Rate applicable to REMIC II Regular Interest ZZ for such Distribution
Date on a balance equal to the Uncertificated Balance of REMIC II Regular
Interest ZZ minus the REMIC II Overcollateralization Amount, in each case for
such Distribution Date, over (ii) Uncertificated Interest on REMIC II Regular
Interest A-1A, REMIC II Regular Interest A-1B1, REMIC II Regular Interest A-1B2,
REMIC II Regular Interest A-2A, REMIC II Regular Interest A-2B, REMIC II Regular
Interest A-2C, REMIC II Regular Interest A-2D, REMIC II Regular Interest M-1,
REMIC II Regular Interest M-2, REMIC II Regular Interest M-3, REMIC II Regular
Interest M-4, REMIC II Regular Interest M-5, REMIC II Regular Interest M-6,
REMIC II Regular Interest M-7, REMIC II Regular Interest M-8, REMIC II Regular
Interest M-9, REMIC II Regular Interest M-10 and REMIC II Regular Interest M-11
for such Distribution Date, with the rate on each such REMIC II Regular Interest
subject to a cap equal to the lesser of (i) the related One-Month LIBOR
Pass-Through Rate and (ii) the related Net WAC Pass-Through Rate for the
Corresponding Certificate for the purpose of this calculation for such
Distribution Date; provided however, each such cap for each REMIC II Regular
Interest shall be multiplied by a fraction the numerator of which is the actual
number of days in the related Interest Accrual Period and the denominator of
which is 30.
"Maximum Mortgage Rate": With respect to each Adjustable Rate Mortgage
Loan, the percentage set forth in the related Mortgage Note as the maximum
Mortgage Rate thereunder.
"MERS": Mortgage Electronic Registration Systems, Inc., a corporation
organized and existing under the laws of the State of Delaware, or any successor
thereto.
"MERS(R) System": The system of recording transfers of mortgages
electronically maintained by MERS.
"Mezzanine Certificate": Any Class ▇-▇, ▇▇▇▇▇ ▇-▇, Class M-3, Class
M-4, Class M-5, Class M-6, Class M-7, Class M-8, Class M-9, Class M-10 and Class
M-11 Certificate.
"MIN": The Mortgage Identification Number for Mortgage Loans registered
with MERS on the MERS(R) System.
"Minimum Mortgage Rate": With respect to each Adjustable Rate Mortgage
Loan, the percentage set forth in the related Mortgage Note as the minimum
Mortgage Rate thereunder.
"MOM Loan": With respect to any Mortgage Loan, MERS acting as the
mortgagee of such Mortgage Loan, solely as nominee for the originator of such
Mortgage Loan and its successors and assigns, at the origination thereof.
"Monthly Payment": With respect to any Mortgage Loan, the scheduled
monthly payment of principal and interest on such Mortgage Loan which is payable
by the related Mortgagor from time to time under the related Mortgage Note,
determined: (a) after giving effect to (i) any Deficient Valuation and/or Debt
Service Reduction with respect to such Mortgage Loan and (ii) any reduction in
the amount of interest collectible from the related Mortgagor pursuant to the
Relief Act or similar state laws; (b) without giving effect to any extension
granted or agreed to by the related Servicer pursuant to Section 3.01 of this
Agreement of pursuant to the Servicing Agreement; and (c) on the assumption that
all other amounts, if any, due under such Mortgage Loan are paid when due.
"Moody's": ▇▇▇▇▇'▇ Investors Service, Inc. or any successor in
interest.
"Mortgage": The mortgage, deed of trust or other instrument creating a
first or second lien on, or first or second priority security interest in, a
Mortgaged Property securing a Mortgage Note.
"Mortgage File": The Mortgage Loan Documents pertaining to a particular
Mortgage Loan.
"Mortgage Loan": Each mortgage loan transferred and assigned to the
Trustee and the Mortgage Loan Documents for which have been delivered to the
related Custodian pursuant to Section 2.01 of this Agreement and pursuant to the
related Custodial Agreement, as held from time to time as a part of the Trust
Fund, the Mortgage Loans so held being identified in the Mortgage Loan Schedule.
"Mortgage Loan Documents": The documents evidencing or relating to each
Mortgage Loan delivered to the Custodian under the related Custodial Agreement
on behalf of the Trustee.
"Mortgage Loan Purchase Agreement": Shall mean the Mortgage Loan
Purchase Agreement dated as of November 28, 2005, between the Depositor and the
Seller.
"Mortgage Loan Schedule": As of any date, the list of Mortgage Loans
included in REMIC I on such date, separately identifying the Group IA Mortgage
Loans, the Group IB Mortgage Loans and the Group II Mortgage Loans, attached
hereto as Schedule 1. The Depositor shall deliver or cause the delivery of the
initial Mortgage Loan Schedule to the related Servicer, the Master Servicer, the
Custodians and the Trustee on the Closing Date. The Mortgage Loan Schedule shall
set forth the following information with respect to each Mortgage Loan:
(i) the Mortgage Loan identifying number;
(ii) the Mortgagor's first and last name;
(iii) the street address of the Mortgaged Property including
the state and zip code;
(iv) a code indicating whether the Mortgaged Property is
owner-occupied;
(v) the type of Residential Dwelling constituting the
Mortgaged Property;
(vi) the original months to maturity;
(vii) the original date of the Mortgage Loan and the remaining
months to maturity from the Cut-off Date, based on the original
amortization schedule;
(viii) the Loan-to-Value Ratio at origination;
(ix) the Mortgage Rate in effect immediately following the
Cut-off Date;
(x) the date on which the first Monthly Payment was due on the
Mortgage Loan;
(xi) the stated maturity date;
(xii) the amount of the Monthly Payment at origination;
(xiii) the amount of the Monthly Payment as of the Cut-off
Date;
(xiv) the last Due Date on which a Monthly Payment was
actually applied to the unpaid Stated Principal Balance;
(xv) the original principal amount of the Mortgage Loan;
(xvi) the Stated Principal Balance of the Mortgage Loan as of
the close of business on the Cut-off Date;
(xvii) with respect to each Adjustable Rate Mortgage Loan, the
first Adjustment Date;
(xviii) with respect to each Adjustable Rate Mortgage Loan,
the Gross Margin;
(xix) a code indicating the purpose of the loan (i.e.,
purchase financing, rate/term refinancing, cash-out refinancing);
(xx) with respect to each Adjustable Rate Mortgage Loan, the
Maximum Mortgage Rate under the terms of the Mortgage Note;
(xxi) with respect to each Adjustable Rate Mortgage Loan, the
Minimum Mortgage Rate under the terms of the Mortgage Note;
(xxii) the Mortgage Rate at origination;
(xxiii) with respect to each Adjustable Rate Mortgage Loan,
the Periodic Rate Cap;
(xxiv) with respect to each Adjustable Rate Mortgage Loan, the
first Adjustment Date immediately following the Cut-off Date;
(xxv) with respect to each Adjustable Rate Mortgage Loan, the
Index;
(xxvi) the date on which the first Monthly Payment was due on
the Mortgage Loan and, if such date is not consistent with the Due Date
currently in effect, such Due Date;
(xxvii) a code indicating whether the Mortgage Loan is an
Adjustable Rate Mortgage Loan or a fixed rate Mortgage Loan;
(xxviii) a code indicating the documentation style (i.e.,
full, stated or limited);
(xxix) a code indicating if the Mortgage Loan is subject to a
primary insurance policy or lender paid mortgage insurance policy and
the name of the insurer and, if applicable, the rate payable in
connection therewith;
(xxx) the Appraised Value of the Mortgaged Property;
(xxxi) the sale price of the Mortgaged Property, if
applicable;
(xxxii) a code indicating whether the Mortgage Loan is subject
to a Prepayment Charge, the term of such Prepayment Charge and the
amount of such Prepayment Charge;
(xxxiii) the product type (e.g., 2/28, 15 year fixed, 30 year
fixed, 15/30 balloon, etc.);
(xxxiv) the Mortgagor's debt to income ratio;
(xxxv) the FICO score at origination;
(xxxvi) with respect to each Mortgage Loan registered on MERS,
the MIN;
(xxxvii) whether such Mortgage Loan is a Simple Interest
Mortgage Loan;
(xxxviii) the applicable Custodian; and
(xxxix) the applicable Servicer.
The Mortgage Loan Schedule shall set forth the following information
with respect to the Mortgage Loans in the aggregate as of the Cut-off Date: (1)
the number of Mortgage Loans; (2) the current principal balance of the Mortgage
Loans; (3) the weighted average Mortgage Rate of the Mortgage Loans; and (4) the
weighted average maturity of the Mortgage Loans. The Mortgage Loan Schedule
shall be amended from time to time by the Depositor in accordance with the
provisions of this Agreement. With respect to any Qualified Substitute Mortgage
Loan, the Cut-off Date shall refer to the related Cut-off Date for such Mortgage
Loan, determined in accordance with the definition of Cut-off Date herein.
"Mortgage Note": The original executed note or other evidence of the
indebtedness of a Mortgagor under a Mortgage Loan.
"Mortgage Rate": With respect to each Mortgage Loan, the annual rate at
which interest accrues on such Mortgage Loan from time to time in accordance
with the provisions of the related Mortgage Note, which rate with respect to
each Adjustable Rate Mortgage Loan (A) as of any date of determination until the
first Adjustment Date following the Cut-off Date shall be the rate set forth in
the Mortgage Loan Schedule as the Mortgage Rate in effect immediately following
the Cut-off Date and (B) as of any date of determination thereafter shall be the
rate as adjusted on the most recent Adjustment Date equal to the sum, rounded to
the nearest 0.125% as provided in the Mortgage Note, of the Index, as most
recently available as of a date prior to the Adjustment Date as set forth in the
related Mortgage Note, plus the related Gross Margin; provided that the Mortgage
Rate on such Adjustable Rate Mortgage Loan on any Adjustment Date shall never be
more than the lesser of (i) the sum of the Mortgage Rate in effect immediately
prior to the Adjustment Date plus the related Periodic Rate Cap, if any, and
(ii) the related Maximum Mortgage Rate, and shall never be less than the greater
of (i) the Mortgage Rate in effect immediately prior to the Adjustment Date less
the Periodic Rate Cap, if any, and (ii) the related Minimum Mortgage Rate. With
respect to each Mortgage Loan that becomes an REO Property, as of any date of
determination, the annual rate determined in accordance with the immediately
preceding sentence as of the date such Mortgage Loan became an REO Property.
"Mortgaged Property": The underlying property securing a Mortgage Loan,
including any REO Property, consisting of an Estate in Real Property improved by
a Residential Dwelling.
"Mortgagor": The obligor on a Mortgage Note.
"Net Monthly Excess Cashflow": With respect to any Distribution Date,
the sum of (i) any Overcollateralization Reduction Amount for such Distribution
Date and (ii) the excess of (x) the Available Distribution Amount for such
Distribution Date over (y) the sum for such Distribution Date of (A) the
aggregate Senior Interest Distribution Amounts payable to the Holders of the
Class A Certificates, (B) the aggregate Interest Distribution Amounts payable to
the holders of the Mezzanine Certificates and (C) the Principal Remittance
Amount.
"Net Mortgage Rate": With respect to any Mortgage Loan (or the related
REO Property) as of any date of determination, a per annum rate of interest
equal to the then applicable Mortgage Rate for such Mortgage Loan minus the
Administration Fee Rate.
"Net Simple Interest Excess": As of any Distribution Date, an amount
equal to the excess, if any, of the aggregate amount of Simple Interest Excess
with respect to the Mortgage Loans over the amount of Simple Interest Shortfall
with respect to the Mortgage Loans.
"Net Simple Interest Shortfall": As of any Distribution Date, an amount
equal to the excess, if any, of the aggregate amount of Simple Interest
Shortfall with respect to the Mortgage Loans over the amount of Simple Interest
Excess with respect to the Mortgage Loans.
"Net Swap Payment": With respect to each Distribution Date, the net
payment required to be made pursuant to the terms of the Swap Agreement by
either the Swap Provider or the Supplemental Interest Trust, which net payment
shall not take into account any Swap Termination Payment.
"Net WAC Pass-Through Rate": With respect to the Class A-1A
Certificates and any Distribution Date, a rate per annum (adjusted for the
actual number of days elapsed in the related Interest Accrual Period) equal to a
fraction, expressed as a percentage, the numerator of which is the amount of
interest which accrued on the Group IA Mortgage Loans in the prior calendar
month minus the fees payable to the Servicers, the Master Servicer and any fee
payable in connection with any lender paid mortgage insurance policies with
respect to the Group IA Mortgage Loans for such Distribution Date and the Group
IA Allocation Percentage of any Net Swap Payment payable to the Swap Provider or
Swap Termination Payment payable to the Swap Provider which was not caused by
the occurrence of a Swap Provider Trigger Event, in each case for such
Distribution Date and the denominator of which is the aggregate principal
balance of the Group IA Mortgage Loans as of the last day of the immediately
preceding Due Period (or as of the Cut-off Date with respect to the first
Distribution Date), after giving effect to Principal Prepayments received during
the related Prepayment Period. For federal income tax purposes, the economic
equivalent of such rate shall be expressed as the weighted average of (adjusted
for the actual number of days elapsed in the related Interest Accrual Period)
the REMIC II Remittance Rate on REMIC II Regular Interest IA-GRP, weighted on
the basis of the Uncertificated Balance of such REMIC II Regular Interest.
With respect to the Class A-1B1 Certificates and Class A-1B2
Certificates and any Distribution Date, a rate per annum (adjusted for the
actual number of days elapsed in the related Interest Accrual Period) equal to a
fraction, expressed as a percentage, the numerator of which is the amount of
interest which accrued on the Group IB Mortgage Loans in the prior calendar
month minus the fees payable to the Servicers, the Master Servicer and any fee
payable in connection with any lender paid mortgage insurance policies with
respect to the Group IB Mortgage Loans for such Distribution Date and the Group
IB Allocation Percentage of any Net Swap Payment payable to the Swap Provider or
Swap Termination Payment payable to the Swap Provider which was not caused by
the occurrence of a Swap Provider Trigger Event, in each case for such
Distribution Date and the denominator of which is the aggregate principal
balance of the Group IB Mortgage Loans as of the last day of the immediately
preceding Due Period (or as of the Cut-off Date with respect to the first
Distribution Date), after giving effect to Principal Prepayments received during
the related Prepayment Period. For federal income tax purposes, the economic
equivalent of such rate shall be expressed as the weighted average of (adjusted
for the actual number of days elapsed in the related Interest Accrual Period)
the REMIC II Remittance Rate on REMIC II Regular Interest IB-GRP, weighted on
the basis of the Uncertificated Balance of such REMIC II Regular Interest.
With respect to the Class A-2 Certificates and any Distribution Date, a
rate per annum (adjusted for the actual number of days elapsed in the related
Interest Accrual Period) equal to a fraction, expressed as a percentage, the
numerator of which is the amount of interest which accrued on the Group II
Mortgage Loans in the prior calendar month minus the fees payable to the
Servicers, the Master Servicer and any fee payable in connection with any lender
paid mortgage insurance policies with respect to the Group II Mortgage Loans for
such Distribution Date and the Group II Allocation Percentage of any Net Swap
Payment payable to the Swap Provider or Swap Termination Payment payable to the
Swap Provider which was not caused by the occurrence of a Swap Provider Trigger
Event, in each case for such Distribution Date and the denominator of which is
the aggregate principal balance of the Group II Mortgage Loans as of the last
day of the immediately preceding Due Period (or as of the Cut-off Date with
respect to the first Distribution Date), after giving effect to Principal
Prepayments received during the related Prepayment Period. For federal income
tax purposes, the economic equivalent of such rate shall be expressed as the
weighted average of (adjusted for the actual number of days elapsed in the
related Interest Accrual Period) the REMIC II Remittance Rate on REMIC II
Regular Interest II-GRP, weighted on the basis of the Uncertificated Balance of
such REMIC II Regular Interest.
With respect to the Mezzanine Certificates and any Distribution Date a
rate per annum equal to (x) the weighted average (weighted in proportion to the
results of subtracting from the Scheduled Principal Balance of each loan group,
the Certificate Principal Balance of the related Class A Certificates) of (i)
the Net WAC Pass-Through Rate for the Class A-1A Certificates, (ii) the Net WAC
Pass-Through Rate for the Class A-1B1 Certificates and Class A-2B2 Certificates
and (iii) the Net WAC Pass-Through Rate for the Class A-2 Certificates. For
federal income tax purposes, the economic equivalent of such rate shall be
expressed as the weighted average of (adjusted for the actual number of days
elapsed in the related Interest Accrual Period) the REMIC II Remittance Rates on
(a) REMIC II Regular Interest IA-SUB, subject to a cap and a floor equal to the
REMIC II Remittance Rate on REMIC II Regular Interest IA-GRP, (b) REMIC II
Regular Interest IB-SUB, subject to a cap and a floor equal to the REMIC II
Remittance Rate on REMIC II Regular Interest IB-GRP and (c) REMIC II Regular
Interest II-SUB, subject to a cap and a floor equal to the REMIC II Remittance
Rate on REMIC II Regular Interest II-GRP, weighted on the basis of the
Uncertificated Balance of each such REMIC II Regular Interest.
"Net WAC Rate Carryover Amount": With respect to any Class A
Certificate or Mezzanine Certificate and any Distribution Date on which the
Pass-Through Rate is limited to the applicable Net WAC Pass-Through Rate, an
amount equal to the sum of (i) the excess of (x) the amount of interest such
Class would have been entitled to receive on such Distribution Date if the
applicable Net WAC Pass-Through Rate would not have been applicable to such
Class on such Distribution Date over (y) the amount of interest paid to such
Class on such Distribution Date at the applicable Net WAC Pass-Through Rate plus
(ii) the related Net WAC Rate Carryover Amount for the previous Distribution
Date not previously distributed to such Class together with interest thereon at
a rate equal to the Pass-Through Rate for such Class for the most recently ended
Interest Accrual Period without taking into account the applicable Net WAC
Pass-Through Rate.
"New Lease": Any lease of REO Property entered into on behalf of REMIC
I, including any lease renewed or extended on behalf of REMIC I, if REMIC I has
the right to renegotiate the terms of such lease.
"Nonrecoverable P&I Advance": Any P&I Advance previously made or
proposed to be made in respect of a Mortgage Loan or REO Property that, in the
good faith business judgment of the related Servicer or a successor to the
related Servicer (including the Master Servicer or the Trustee, as applicable)
will not or, in the case of a proposed P&I Advance, would not be ultimately
recoverable from related Late Collections, Insurance Proceeds or Liquidation
Proceeds on such Mortgage Loan or REO Property as provided herein or in the
Servicing Agreement.
"Nonrecoverable Servicing Advance": Any Servicing Advance previously
made or proposed to be made in respect of a Mortgage Loan or REO Property that,
in the good faith business judgment of the related Service or a successor to a
Servicer (including the Master Servicer or the Trustee, as applicable), will not
or, in the case of a proposed Servicing Advance, would not be ultimately
recoverable from related Late Collections, Insurance Proceeds or Liquidation
Proceeds on such Mortgage Loan or REO Property as provided herein or in the
Servicing Agreement.
"Non-United States Person": Any Person other than a United States
Person.
"Notional Amount": With respect to the Class CE Certificates and any
Distribution Date, the Uncertificated Balance of the REMIC II Regular Interests
(other than REMIC II Regular Interest P) for such Distribution Date. As of the
Closing Date, the Notional Amount of the Class CE Certificates is equal to
60,220,369.
"Offered Certificates": The Class A Certificates and the Mezzanine
Certificates, collectively.
"Officer's Certificate": With respect to any Person, a certificate
signed by the Chairman of the Board, the Vice Chairman of the Board, the
President or a vice president (however denominated), or by the Treasurer, the
Secretary, or one of the assistant treasurers or assistant secretaries of such
Person (or, in the case of a Person that is not a corporation, signed by a
person or persons having like responsibilities.
"One-Month LIBOR": With respect to the Class A Certificates, the
Mezzanine Certificates, REMIC II Regular Interests (other than REMIC II Regular
Interest P) and any Interest Accrual Period therefor, the rate determined by the
Securities Administrator on the related Interest Determination Date on the basis
of the offered rate for one-month U.S. dollar deposits, as such rate appears on
Telerate Page 3750 as of 11:00 a.m. (London time) on such Interest Determination
Date; provided that if such rate does not appear on Telerate Page 3750, the rate
for such date will be determined on the basis of the offered rates of the
Reference Banks for one-month U.S. dollar deposits, as of 11:00 a.m. (London
time) on such Interest Determination Date. In such event, the Securities
Administrator will request the principal London office of each of the Reference
Banks to provide a quotation of its rate. If on such Interest Determination
Date, two or more Reference Banks provide such offered quotations, One-Month
LIBOR for the related Interest Accrual Period shall be the arithmetic mean of
such offered quotations (rounded upwards if necessary to the nearest whole
multiple of 1/16). If on such Interest Determination Date, fewer than two
Reference Banks provide such offered quotations, One-Month LIBOR for the related
Interest Accrual Period shall be the higher of (i) LIBOR as determined on the
previous Interest Determination Date and (ii) the Reserve Interest Rate.
Notwithstanding the foregoing, if, under the priorities described above, LIBOR
for an Interest Determination Date would be based on LIBOR for the previous
Interest Determination Date for the third consecutive Interest Determination
Date, the Securities Administrator shall select an alternative comparable index
(over which the Securities Administrator has no control), used for determining
one-month Eurodollar lending rates that is calculated and published (or
otherwise made available) by an independent party. The establishment of
One-Month LIBOR by the Securities Administrator and the Securities
Administrator's subsequent calculation of the One-Month LIBOR Pass-Through Rates
for the relevant Interest Accrual Period, shall, in the absence of manifest
error, be final and binding.
"One-Month LIBOR Pass-Through Rate": With respect to the Class A-1A
Certificates and, for purposes of the definition of "Marker Rate", REMIC II
Regular Interest A-1A, a per annum rate equal to One-Month LIBOR plus the
related Certificate Margin.
With respect to the Class A-1B1 Certificates and, for purposes of the
definition of "Marker Rate", REMIC II Regular Interest A-1B1, a per annum rate
equal to One-Month LIBOR plus the related Certificate Margin.
With respect to the Class A-1B2 Certificates and, for purposes of the
definition of "Marker Rate", REMIC II Regular Interest A-1B2, a per annum rate
equal to One-Month LIBOR plus the related Certificate Margin.
With respect to the Class A-2A Certificates and, for purposes of the
definition of "Marker Rate", REMIC II Regular Interest A-2A, a per annum rate
equal to One-Month LIBOR plus the related Certificate Margin.
With respect to the Class A-2B Certificates and, for purposes of the
definition of "Marker Rate", REMIC II Regular Interest A-2B, a per annum rate
equal to One-Month LIBOR plus the related Certificate Margin.
With respect to the Class A-2C Certificates and, for purposes of the
definition of "Marker Rate", REMIC II Regular Interest A-2C, a per annum rate
equal to One-Month LIBOR plus the related Certificate Margin.
With respect to the Class A-2D Certificates and, for purposes of the
definition of "Marker Rate", REMIC II Regular Interest A-2D, a per annum rate
equal to One-Month LIBOR plus the related Certificate Margin.
With respect to the Class M-1 Certificates and, for purposes of the
definition of "Marker Rate", REMIC II Regular Interest M-1, a per annum rate
equal to One-Month LIBOR plus the related Certificate Margin.
With respect to the Class M-2 Certificates and, for purposes of the
definition of "Marker Rate", REMIC II Regular Interest M-2, a per annum rate
equal to One-Month LIBOR plus the related Certificate Margin.
With respect to the Class M-3 Certificates and, for purposes of the
definition of "Marker Rate", REMIC II Regular Interest M-3, a per annum rate
equal to One-Month LIBOR plus the related Certificate Margin.
With respect to the Class M-4 Certificates and, for purposes of the
definition of "Marker Rate", REMIC II Regular Interest M-4, a per annum rate
equal to One-Month LIBOR plus the related Certificate Margin.
With respect to the Class M-5 Certificates and, for purposes of the
definition of "Marker Rate", REMIC II Regular Interest M-5, a per annum rate
equal to One-Month LIBOR plus the related Certificate Margin.
With respect to the Class M-6 Certificates and, for purposes of the
definition of "Marker Rate", REMIC II Regular Interest M-6, a per annum rate
equal to One-Month LIBOR plus the related Certificate Margin.
With respect to the Class M-7 Certificates and, for purposes of the
definition of "Marker Rate", REMIC II Regular Interest M-7, a per annum rate
equal to One-Month LIBOR plus the related Certificate Margin.
With respect to the Class M-8 Certificates and, for purposes of the
definition of "Marker Rate", REMIC II Regular Interest M-8, a per annum rate
equal to One-Month LIBOR plus the related Certificate Margin.
With respect to the Class M-9 Certificates and, for purposes of the
definition of "Marker Rate", REMIC II Regular Interest M-9, a per annum rate
equal to One-Month LIBOR plus the related Certificate Margin.
With respect to the Class M-10 Certificates and, for purposes of the
definition of "Marker Rate", REMIC II Regular Interest M-10, a per annum rate
equal to One-Month LIBOR plus the related Certificate Margin.
With respect to the Class M-11 Certificates and, for purposes of the
definition of "Marker Rate", REMIC II Regular Interest M-11, a per annum rate
equal to One-Month LIBOR plus the related Certificate Margin.
"Opinion of Counsel": A written opinion of counsel, who may, without
limitation, be salaried counsel for the Depositor, the related Servicer, the
Securities Administrator or the Master Servicer, acceptable to the Trustee,
except that any opinion of counsel relating to (a) the qualification of any
REMIC as a REMIC or (b) compliance with the REMIC Provisions must be an opinion
of Independent counsel; provided however, any Opinion of Counsel provided by a
Servicer pursuant to clause (b) above with respect to the continued eligibility
of modified Mortgage Loans may be provided by internal counsel, provided that,
the delivery of such Opinion of Counsel shall not release the Servicer from any
of its obligations hereunder and the Servicer shall be responsible for such
contemplated actions or inaction, as the case may be, to the extent it conflicts
with the terms of this Agreement.
"Optional Termination Date": The Distribution Date on which the
aggregate principal balance of the Mortgage Loans (and properties acquired in
respect thereof) remaining in the Trust Fund is equal to or less than 10% of the
aggregate principal balance of the Mortgage Loans as of the Cut-off Date.
"Overcollateralization Amount": With respect to any Distribution Date,
the excess, if any, of (a) the aggregate Stated Principal Balances of the
Mortgage Loans and REO Properties immediately following such Distribution Date
over (b) the sum of the aggregate Certificate Principal Balances of the Class A
Certificates, the Mezzanine Certificates and the Class P Certificates as of such
Distribution Date (after taking into account the payment of the Principal
Remittance Amount on such Distribution Date).
"Overcollateralization Increase Amount": With respect to any
Distribution Date, the amount of Net Monthly Excess Cashflow actually applied as
an accelerated payment of principal to the Class A Certificates and the
Mezzanine Certificates then entitled to distributions of principal to the extent
the Required Overcollateralization Amount exceeds the Overcollateralization
Amount.
"Overcollateralization Reduction Amount": With respect to any
Distribution Date, the lesser of (i) the amount by which the
Overcollateralization Amount exceeds the Required Overcollateralization Amount
and (ii) the Principal Remittance Amount; provided however that on any
Distribution Date on which a Trigger Event is in effect, the
Overcollateralization Reduction Amount shall equal zero.
"Ownership Interest": As to any Certificate, any ownership or security
interest in such Certificate, including any interest in such Certificate as the
Holder thereof and any other interest therein, whether direct or indirect, legal
or beneficial, as owner or as pledgee.
"P&I Advance": As to any Mortgage Loan or REO Property, any advance
made by the related Servicer in respect of any Determination Date pursuant to
Section 5.03 of this Agreement, an Advance Financing Person pursuant to Section
3.25 of this Agreement or in respect of any Distribution Date by a successor
Servicer (including the Master Servicer or the Trustee, as applicable) pursuant
to Section 8.02 of this Agreement or pursuant to the Servicing Agreement (which
advances shall not include principal or interest shortfalls due to bankruptcy
proceedings or application of the Relief Act or similar state or local laws).
"Pass-Through Rate": With respect to the Class A Certificates and the
Mezzanine Certificates, and any Distribution Date, a rate per annum equal to the
lesser of (i) the related One-Month LIBOR Pass-Through Rate for such
Distribution Date and (ii) the related Net WAC Pass-Through Rate for such
Distribution Date.
With respect to the Class CE Certificates and any Distribution Date, a
rate per annum equal to the percentage equivalent of a fraction, the numerator
of which is the sum of the amounts calculated pursuant to clauses (i) through
(xxi) below, and the denominator of which is the aggregate Uncertificated
Balances of REMIC II Regular Interest AA, REMIC II Regular Interest A-1A, REMIC
II Regular Interest A-1B1, REMIC II Regular Interest A-1B2, REMIC II Regular
Interest A-2A, REMIC II Regular Interest A-2B, REMIC II Regular Interest A-2C,
REMIC II Regular Interest A-2D, REMIC II Regular Interest M-1, REMIC II Regular
Interest M-2, REMIC II Regular Interest M-3, REMIC II Regular Interest M-4,
REMIC II Regular Interest M-5, REMIC II Regular Interest M-6, REMIC II Regular
Interest M-7, REMIC II Regular Interest M-8, REMIC II Regular Interest M-9,
REMIC II Regular Interest M-10, REMIC II Regular Interest M-11 and REMIC II
Regular Interest ZZ. For purposes of calculating the Pass-Through Rate for the
Class CE Certificates, the numerator is equal to the sum of the following
components:
(i) the REMIC II Remittance Rate for REMIC II Regular Interest
AA minus the Marker Rate, applied to an amount equal to the
Uncertificated Balance of REMIC II Regular Interest AA;
(ii) the REMIC II Remittance Rate for REMIC II Regular
Interest A-1A minus the Marker Rate, applied to an amount equal to the
Uncertificated Balance of REMIC II Regular Interest A-1A;
(iii) the REMIC II Remittance Rate for REMIC II Regular
Interest A-1B1 minus the Marker Rate, applied to an amount equal to the
Uncertificated Balance of REMIC II Regular Interest A-1B1;
(iv) the REMIC II Remittance Rate for REMIC II Regular
Interest A-1B2 minus the Marker Rate, applied to an amount equal to the
Uncertificated Balance of REMIC II Regular Interest A-1B2;
(v) the REMIC II Remittance Rate for REMIC II Regular Interest
A-2A minus the Marker Rate, applied to an amount equal to the
Uncertificated Balance of REMIC II Regular Interest A-2A;
(vi) the REMIC II Remittance Rate for REMIC II Regular
Interest A-2B minus the Marker Rate, applied to an amount equal to the
Uncertificated Balance of REMIC II Regular Interest A-2B;
(vii) the REMIC II Remittance Rate for REMIC II Regular
Interest A-2C minus the Marker Rate, applied to an amount equal to the
Uncertificated Balance of REMIC II Regular Interest A-2C;
(viii) the REMIC II Remittance Rate for REMIC II Regular
Interest A-2D minus the Marker Rate, applied to an amount equal to the
Uncertificated Balance of REMIC II Regular Interest A-2D;
(ix) the REMIC II Remittance Rate for REMIC II Regular
Interest M-1 minus the Marker Rate, applied to an amount equal to the
Uncertificated Balance of REMIC II Regular Interest M-1;
(x) the REMIC II Remittance Rate for REMIC II Regular Interest
M-2 minus the Marker Rate, applied to an amount equal to the
Uncertificated Balance of REMIC II Regular Interest M-2;
(xi) the REMIC II Remittance Rate for REMIC II Regular
Interest M-3 minus the Marker Rate, applied to an amount equal to the
Uncertificated Balance of REMIC II Regular Interest M-3;
(xii) the REMIC II Remittance Rate for REMIC II Regular
Interest M-4 minus the Marker Rate, applied to an amount equal to the
Uncertificated Balance of REMIC II Regular Interest M-4;
(xiii) the REMIC II Remittance Rate for REMIC II Regular
Interest M-5 minus the Marker Rate, applied to an amount equal to the
Uncertificated Balance of REMIC II Regular Interest M-5;
(xiv) the REMIC II Remittance Rate for REMIC II Regular
Interest M-6 minus the Marker Rate, applied to an amount equal to the
Uncertificated Balance of REMIC II Regular Interest M-6;
(xv) the REMIC II Remittance Rate for REMIC II Regular
Interest M-7 minus the Marker Rate, applied to an amount equal to the
Uncertificated Balance of REMIC II Regular Interest M-7;
(xvi) the REMIC II Remittance Rate for REMIC II Regular
Interest M-8 minus the Marker Rate, applied to an amount equal to the
Uncertificated Balance of REMIC II Regular Interest M-8;
(xvii) the REMIC II Remittance Rate for REMIC II Regular
Interest M-9 minus the Marker Rate, applied to an amount equal to the
Uncertificated Balance of REMIC II Regular Interest M-9;
(xviii) the REMIC II Remittance Rate for REMIC II Regular
Interest M-10 minus the Marker Rate, applied to an amount equal to the
Uncertificated Balance of REMIC II Regular Interest M-10;
(xix) the REMIC II Remittance Rate for REMIC II Regular
Interest M-11 minus the Marker Rate, applied to an amount equal to the
Uncertificated Balance of REMIC II Regular Interest M-11;
(xx) the REMIC II Remittance Rate for REMIC II Regular
Interest ZZ minus the Marker Rate, applied to an amount equal to the
Uncertificated Balance of REMIC II Regular Interest ZZ; and
(xxi) 100% of the interest on REMIC II Regular Interest P.
With respect to REMIC III Regular Interest IO, REMIC III Regular
Interest IO shall not have a Pass-Through Rate, but current interest for REMIC
III Regular Interest IO and each Distribution Date shall be an amount equal to
100% of the amounts distributable to REMIC II Regular Interest IO for such
Distribution Date.
"Percentage Interest": With respect to any Class of Certificates (other
than the Residual Certificates), the undivided percentage ownership in such
Class evidenced by such Certificate, expressed as a percentage, the numerator of
which is the initial Certificate Principal Balance represented by such
Certificate and the denominator of which is the aggregate initial Certificate
Principal Balance or Notional Amount of all of the Certificates of such Class.
The Class A Certificates and the Mezzanine Certificates are issuable only in
minimum Percentage Interests corresponding to minimum initial Certificate
Principal Balances of 25,000 and integral multiples of 1.00 in excess thereof.
The Class P Certificates are issuable only in Percentage Interests corresponding
to initial Certificate Principal Balances of 20 and integral multiples thereof.
The Class CE Certificates are issuable only in minimum Percentage Interests
corresponding to minimum initial Notional Balances of 10,000 and integral
multiples of 1.00 in excess thereof; provided, however, that a single
Certificate of each such Class of Certificates may be issued having a Percentage
Interest corresponding to the remainder of the aggregate initial Notional
Balance of such Class or to an otherwise authorized denomination for such Class
plus such remainder. With respect to any Residual Certificate, the undivided
percentage ownership in such Class evidenced by such Certificate, as set forth
on the face of such Certificate. The Residual Certificates are issuable in
Percentage Interests of 20% and integral multiples of 5% in excess thereof.
"Periodic Rate Cap": With respect to each Adjustable Rate Mortgage Loan
and any Adjustment Date therefor, the fixed percentage set forth in the related
Mortgage Note, which is the maximum amount by which the Mortgage Rate for such
Adjustable Rate Mortgage Loan may increase or decrease (without regard to the
Maximum Mortgage Rate or the Minimum Mortgage Rate) on such Adjustment Date from
the Mortgage Rate in effect immediately prior to such Adjustment Date.
"Permitted Investments": Any one or more of the following obligations
or securities acquired at a purchase price of not greater than par, regardless
of whether issued by the Depositor, ▇▇▇▇▇ Fargo, the Master Servicer, the
Trustee or any of their respective Affiliates:
(i) direct obligations of, or obligations fully guaranteed as
to timely payment of principal and interest by, the United States or
any agency or instrumentality thereof, provided such obligations are
backed by the full faith and credit of the United States;
(ii) (A) demand and time deposits in, certificates of deposit
of, bankers' acceptances issued by or federal funds sold by any
depository institution or trust company (including the Trustee or its
agent acting in their respective commercial capacities) incorporated
under the laws of the United States of America or any state thereof and
subject to supervision and examination by federal and/or state
authorities, so long as, at the time of such investment or contractual
commitment providing for such investment, such depository institution
or trust company (or, if the only Rating Agency is S&P, in the case of
the principal depository institution in a depository institution
holding company, debt obligations of the depository institution holding
company) or its ultimate parent has a short-term uninsured debt rating
in the highest available rating category of ▇▇▇▇▇'▇ and S&P and
provided that each such investment has an original maturity of no more
than 365 days; and provided further that, if the only Rating Agency is
S&P and if the depository or trust company is a principal subsidiary of
a bank holding company and the debt obligations of such subsidiary are
not separately rated, the applicable rating shall be that of the bank
holding company; and, provided further that, if the original maturity
of such short-term obligations of a domestic branch of a foreign
depository institution or trust company shall exceed 30 days, the
short-term rating of such institution shall be A-1+ in the case of S&P
if S&P is the Rating Agency; and (B) any other demand or time deposit
or deposit which is fully insured by the FDIC;
(iii) repurchase obligations with a term not to exceed 30 days
with respect to any security described in clause (i) above and entered
into with a depository institution or trust company (acting as
principal) rated A-1+ or higher by S&P and A2 or higher by ▇▇▇▇▇'▇,
provided, however, that collateral transferred pursuant to such
repurchase obligation must be of the type described in clause (i) above
and must (A) be valued daily at current market prices plus accrued
interest, (B) pursuant to such valuation, be equal, at all times, to
105% of the cash transferred by a party in exchange for such collateral
and (C) be delivered to such party or, if such party is supplying the
collateral, an agent for such party, in such a manner as to accomplish
perfection of a security interest in the collateral by possession of
certificated securities;
(iv) securities bearing interest or sold at a discount that
are issued by any corporation incorporated under the laws of the United
States of America or any state thereof and that are rated by each
Rating Agency that rates such securities in its highest long-term
unsecured rating categories at the time of such investment or
contractual commitment providing for such investment;
(v) commercial paper (including both non-interest-bearing
discount obligations and interest-bearing obligations payable on demand
or on a specified date not more than 30 days after the date of
acquisition thereof) that is rated by each Rating Agency that rates
such securities in its highest short-term unsecured debt rating
available at the time of such investment;
(vi) units of money market funds that have been rated "AAA" by
S&P or "Aaa" by ▇▇▇▇▇'▇ including any such money market fund managed or
advised by the Master Servicer, the Trustee or any of their Affiliates;
and
(vii) if previously confirmed in writing to the Trustee, any
other demand, money market or time deposit, or any other obligation,
security or investment, as may be acceptable to the Rating Agencies as
a permitted investment of funds backing securities having ratings
equivalent to its highest initial rating of the Class A Certificates;
provided, however, that no instrument described hereunder shall evidence either
the right to receive (a) only interest with respect to the obligations
underlying such instrument or (b) both principal and interest payments derived
from obligations underlying such instrument and the interest and principal
payments with respect to such instrument provide a yield to maturity at par
greater than 120% of the yield to maturity at par of the underlying obligations.
"Permitted Transferee": Any Transferee of a Residual Certificate other
than a Disqualified Organization or Non-United States Person.
"Person": Any individual, limited liability company, corporation,
partnership, joint venture, association, joint-stock company, trust,
unincorporated organization or government or any agency or political subdivision
thereof.
"Plan": Any employee benefit plan or certain other retirement plans and
arrangements, including individual retirement accounts and annuities, ▇▇▇▇▇
plans and bank collective investment funds and insurance company general or
separate accounts in which such plans, accounts or arrangements are invested,
that are subject to ERISA or Section 4975 of the Code.
"Prepayment Assumption": A prepayment rate for (a) the Adjustable Rate
Mortgage Loans of 100% PPC, which represents (i) a per annum prepayment rate of
5% of the then outstanding principal balance of the Adjustable Rate Mortgage
Loans in the first month of the life of the Adjustable Rate Mortgage Loans, (ii)
an additional 2% per annum in each month thereafter through the eleventh month,
(iii) building to a constant prepayment rate of 27% per annum beginning in the
twelfth month and remaining constant until the twenty-third month, (iv)
increasing to and remaining constant at a prepayment rate of 60% per annum
beginning in the twenty-fourth month until the twenty-seventh month and (v)
decreasing and remaining constant at a prepayment rate of 30% per annum from the
twenty-eighth month and thereafter and (b) the fixed-rate Mortgage Loans of 100%
PPC, which represents (i) a per annum prepayment rate of 4% of the then
outstanding principal balance of the fixed rate Mortgage Loans in the first
month of the life of such Mortgage Loans, (ii) an additional 1.72727% per annum
in each month thereafter through the eleventh month and (iii) a constant
prepayment rate of 23% per annum beginning in the twelfth month and in each
month thereafter during the life of the fixed rate Mortgage Loans; provided,
however, the prepayment rate will not exceed 85% per annum in any period for any
percentage of PPC. The Prepayment Assumption is used solely for determining the
accrual of original issue discount on the Certificates for federal income tax
purposes.
"Prepayment Charge": With respect to any Principal Prepayment, any
prepayment premium, penalty or charge payable by a Mortgagor in connection with
any Principal Prepayment on a Mortgage Loan pursuant to the terms of the related
Mortgage Note.
"Prepayment Charge Schedule": As of any date, the list of Mortgage
Loans providing for a Prepayment Charge included in the Trust Fund on such date,
attached hereto as Schedule 2 (including the prepayment charge summary attached
thereto). The Depositor shall deliver or cause the delivery of the Prepayment
Charge Schedule to ▇▇▇▇▇ Fargo (with respect to the ▇▇▇▇▇ Fargo Mortgage Loans),
the Master Servicer and the Trustee on the Closing Date. The Prepayment Charge
Schedule shall set forth the following information with respect to each
Prepayment Charge:
(i) the Mortgage Loan identifying number;
(ii) a code indicating the type of Prepayment Charge;
(iii) the date on which the first Monthly Payment was due on
the related Mortgage Loan;
(iv) the term of the related Prepayment Charge;
(v) the original Stated Principal Balance of the related
Mortgage Loan; and
(vi) the Stated Principal Balance of the related Mortgage Loan
as of the Cut-off Date.
"Prepayment Interest Excess": With respect to each ▇▇▇▇▇ Fargo Mortgage
Loan that was the subject of a Principal Prepayment in full during the portion
of the related Prepayment Period occurring between the first day of the calendar
month in which such Distribution Date occurs and the Determination Date of the
calendar month in which such Distribution Date occurs, an amount equal to
interest (to the extent received) at the applicable Net Mortgage Rate on the
amount of such Principal Prepayment for the number of days commencing on the
first day of the calendar month in which such Distribution Date occurs and
ending on the last date through which interest is collected from the related
Mortgagor. ▇▇▇▇▇ Fargo may withdraw such Prepayment Interest Excess from the
related Collection Account in accordance with Section 3.09(a)(x) of this
Agreement. The entitlement of Countrywide, if any, with respect to Prepayment
Interest Excess is set forth in the Servicing Agreement.
"Prepayment Interest Shortfall": With respect to any Distribution Date,
for each such Mortgage Loan that was the subject of a Principal Prepayment in
full or in part during the portion of the related Prepayment Period occurring
between the first day of the related Prepayment Period and the last day of the
calendar month preceding the month in which such Distribution Date occurs that
was applied by the related Servicer to reduce the outstanding principal balance
of such Mortgage Loan on a date preceding the Due Date in the succeeding
Prepayment Period, an amount equal to interest at the applicable Net Mortgage
Rate on the amount of such Principal Prepayment for the number of days
commencing on the date on which the prepayment is applied and ending on the last
day of the calendar month preceding such Distribution Date. The obligations of
▇▇▇▇▇ Fargo and the Master Servicer in respect of any Prepayment Interest
Shortfall are set forth in Section 3.22 and Section 4.18, respectively of this
Agreement. The obligations of Countrywide in respect of any Prepayment Interest
Shortfalls are set forth in the Servicing Agreement.
"Prepayment Period": With respect to the ▇▇▇▇▇ Fargo Mortgage Loans and
any Distribution Date, the calendar month preceding the month in which the
related Distribution Date occurs with respect to prepayments in part, and the
period beginning on the fourteenth (14th) day of the month preceding the related
Distribution Date (or, the period commencing on the Cut-off Date, in connection
with the first Prepayment Period) and ending on the thirteenth (13th) day of the
month in which such Distribution Date occurs with respect to prepayments in
full. With respect to the Countrywide Mortgage Loans, the period specified in
the Servicing Agreement.
"Principal Prepayment": Any voluntary payment of principal made by the
Mortgagor on a Mortgage Loan which is received in advance of its scheduled Due
Date and which is not accompanied by an amount of interest representing the full
amount of scheduled interest due on any Due Date in any month or months
subsequent to the month of prepayment.
"Principal Distribution Amount": With respect to any Distribution Date
is the sum of the Group IA Principal Distribution Amount, the Group IB Principal
Distribution Amount and the Group II Principal Distribution Amount.
"Principal Remittance Amount": With respect to any Distribution Date is
the sum of the Group IA Principal Remittance Amount, the Group IB Principal
Remittance Amount and the Group II Principal Remittance Amount.
"Purchase Price": With respect to any Mortgage Loan or REO Property to
be purchased pursuant to or as contemplated by Section 2.03, Section 3.13(c) or
Section 10.01 of this Agreement, and as confirmed by a certification of a
Servicing Officer of the related Servicer to the Trustee, an amount equal to the
sum of (i) 100% of the Stated Principal Balance thereof as of the date of
purchase (or such other price as provided in Section 10.01 of this Agreement),
(ii) in the case of (x) a Mortgage Loan, accrued interest on such Stated
Principal Balance at the applicable Net Mortgage Rate in effect from time to
time from the Due Date as to which interest was last covered by a payment by the
Mortgagor or a P&I Advance by the related Servicer, which payment or P&I Advance
had as of the date of purchase been distributed pursuant to Section 5.01 of this
Agreement, through the end of the calendar month in which the purchase is to be
effected and (y) an REO Property, the sum of (1) accrued interest on such Stated
Principal Balance at the applicable Net Mortgage Rate in effect from time to
time from the Due Date as to which interest was last covered by a payment by the
Mortgagor or a P&I Advance by the related Servicer through the end of the
calendar month immediately preceding the calendar month in which such REO
Property was acquired, plus (2) REO Imputed Interest for such REO Property for
each calendar month commencing with the calendar month in which such REO
Property was acquired and ending with the calendar month in which such purchase
is to be effected, net of the total of all net rental income, Insurance
Proceeds, Liquidation Proceeds and P&I Advances that as of the date of purchase
had been distributed as or to cover REO Imputed Interest pursuant to Section
5.01 of this Agreement, (iii) any unreimbursed Servicing Advances and P&I
Advances (including Nonrecoverable P&I Advances and Nonrecoverable Servicing
Advances) and any unpaid Servicing Fees allocable to such Mortgage Loan or REO
Property, (iv) any amounts previously withdrawn from the related Collection
Account pursuant to Section 3.09(a)(ix) and Section 3.13(b) of this Agreement
and the Custodial Account pursuant to corresponding sections of the Servicing
Agreement and (v) in the case of a Mortgage Loan required to be purchased
pursuant to Section 2.03 of this Agreement, expenses reasonably incurred or to
be incurred by the related Servicer or the Trustee in respect of the breach or
defect giving rise to the purchase obligation and any costs and damages incurred
by the Trust Fund and the Trustee in connection with any violation by any such
Mortgage Loan of any predatory or abusive lending law.
"QIB": As defined in Section 6.01(c).
"Qualified Substitute Mortgage Loan": A mortgage loan substituted for a
Deleted Mortgage Loan pursuant to the terms of this Agreement which must, on the
date of such substitution, (i) have an outstanding principal balance, after
application of all scheduled payments of principal and interest due during or
prior to the month of substitution, not in excess of the Scheduled Principal
Balance of the Deleted Mortgage Loan as of the Due Date in the calendar month
during which the substitution occurs, (ii) have a Mortgage Rate not less than
(and not more than one percentage point in excess of) the Mortgage Rate of the
Deleted Mortgage Loan, (iii) if the mortgage loan is an Adjustable Rate Mortgage
Loan, have a Maximum Mortgage Rate not less than the Maximum Mortgage Rate on
the Deleted Mortgage Loan, (iv) if the mortgage loan is an Adjustable Rate
Mortgage Loan, have a Minimum Mortgage Rate not less than the Minimum Mortgage
Rate of the Deleted Mortgage Loan, (v) if the mortgage loan is an Adjustable
Rate Mortgage Loan, have a Gross Margin equal to the Gross Margin of the Deleted
Mortgage Loan, (vi) if the mortgage loan is an Adjustable Rate Mortgage Loan,
have a next Adjustment Date not more than two months later than the next
Adjustment Date on the Deleted Mortgage Loan, (vii) have a remaining term to
maturity not greater than (and not more than one year less than) that of the
Deleted Mortgage Loan, (viii) have the same Due Date as the Due Date on the
Deleted Mortgage Loan, (ix) have a Loan-to-Value Ratio as of the date of
substitution equal to or lower than the Loan-to-Value Ratio of the Deleted
Mortgage Loan as of such date, (x) be secured by the same lien priority on the
related Mortgaged Property as the Deleted Mortgage Loan, (xi) have a credit
grade at least equal to the credit grading assigned on the Deleted Mortgage
Loan, (xii) be a "qualified mortgage" as defined in the REMIC Provisions and
(xiii) conform to each representation and warranty set forth in Section 6 of the
Mortgage Loan Purchase Agreement applicable to the Deleted Mortgage Loan. In the
event that one or more mortgage loans are substituted for one or more Deleted
Mortgage Loans, the amounts described in clause (i) hereof shall be determined
on the basis of aggregate principal balances, the Mortgage Rates described in
clause (ii) hereof shall be determined on the basis of weighted average Mortgage
Rates, the terms described in clause (vii) hereof shall be determined on the
basis of weighted average remaining term to maturity, the Loan-to-Value Ratios
described in clause (ix) hereof shall be satisfied as to each such mortgage
loan, the credit grades described in clause (x) hereof shall be satisfied as to
each such mortgage loan and, except to the extent otherwise provided in this
sentence, the representations and warranties described in clause (xii) hereof
must be satisfied as to each Qualified Substitute Mortgage Loan or in the
aggregate, as the case may be.
"Rate/Term Refinancing": A Refinanced Mortgage Loan, the proceeds of
which are not more than a nominal amount in excess of the existing first
mortgage loan and any subordinate mortgage loan on the related Mortgaged
Property and related closing costs, and were used exclusively (except for such
nominal amount) to satisfy the then existing first mortgage loan and any
subordinate mortgage loan of the Mortgagor on the related Mortgaged Property and
to pay related closing costs.
"Rating Agency or Rating Agencies": ▇▇▇▇▇'▇ and S&P or their
successors. If such agencies or their successors are no longer in existence,
"Rating Agencies" shall be such nationally recognized statistical rating
agencies, or other comparable Persons, designated by the Depositor, notice of
which designation shall be given to the Trustee and the Servicers.
"Realized Loss": With respect to each Mortgage Loan as to which a Final
Recovery Determination has been made, an amount (not less than zero), as
reported by the related Servicer to the Master Servicer (in substantially the
form of Schedule 4 hereto), equal to (i) the unpaid principal balance of such
Mortgage Loan as of the commencement of the calendar month in which the Final
Recovery Determination was made, plus (ii) accrued interest from the Due Date as
to which interest was last paid by the Mortgagor through the end of the calendar
month in which such Final Recovery Determination was made, calculated in the
case of each calendar month during such period (A) at an annual rate equal to
the annual rate at which interest was then accruing on such Mortgage Loan and
(B) on a principal amount equal to the Stated Principal Balance of such Mortgage
Loan as of the close of business on the Distribution Date during such calendar
month, plus (iii) any amounts previously withdrawn from the related Collection
Account or Custodial Account in respect of such Mortgage Loan pursuant to
Section 3.09(a)(ix) and Section 3.13(b) of this Agreement or pursuant to
corresponding provisions of the Servicing Agreement, as applicable, minus (iv)
the proceeds, if any, received in respect of such Mortgage Loan during the
calendar month in which such Final Recovery Determination was made, net of
amounts that are payable therefrom to the related Servicer with respect to such
Mortgage Loan pursuant to Section 3.09(a)(iii) of this Agreement or pursuant to
the Servicing Agreement.
With respect to any REO Property as to which a Final Recovery
Determination has been made, an amount (not less than zero) equal to (i) the
unpaid principal balance of the related Mortgage Loan as of the date of
acquisition of such REO Property on behalf of REMIC I, plus (ii) accrued
interest from the Due Date as to which interest was last paid by the Mortgagor
in respect of the related Mortgage Loan through the end of the calendar month
immediately preceding the calendar month in which such REO Property was
acquired, calculated in the case of each calendar month during such period (A)
at an annual rate equal to the annual rate at which interest was then accruing
on the related Mortgage Loan and (B) on a principal amount equal to the Stated
Principal Balance of the related Mortgage Loan as of the close of business on
the Distribution Date during such calendar month, plus (iii) REO Imputed
Interest for such REO Property for each calendar month commencing with the
calendar month in which such REO Property was acquired and ending with the
calendar month in which such Final Recovery Determination was made, plus (iv)
any amounts previously withdrawn from the related Collection Account or the
Custodial Account in respect of the related Mortgage Loan pursuant to Section
3.09(a)(ix) and Section 3.13(b) of this Agreement or pursuant to corresponding
sections of the Servicing Agreement, as applicable, minus (v) the aggregate of
all P&I Advances and Servicing Advances (in the case of Servicing Advances,
without duplication of amounts netted out of the rental income, Insurance
Proceeds and Liquidation Proceeds described in clause (vi) below) made by the
related Servicer in respect of such REO Property or the related Mortgage Loan
for which the related Servicer has been or, in connection with such Final
Recovery Determination, will be reimbursed pursuant to Section 3.21 of this
Agreement or pursuant to the Servicing Agreement out of rental income, Insurance
Proceeds and Liquidation Proceeds received in respect of such REO Property,
minus (vi) the total of all net rental income, Insurance Proceeds and
Liquidation Proceeds received in respect of such REO Property that has been, or
in connection with such Final Recovery Determination, will be transferred to the
Distribution Account pursuant to Section 3.21 of this Agreement or pursuant to
the Servicing Agreement.
With respect to each Mortgage Loan which has become the subject of a
Deficient Valuation, the difference between the principal balance of the
Mortgage Loan outstanding immediately prior to such Deficient Valuation and the
principal balance of the Mortgage Loan as reduced by the Deficient Valuation.
With respect to each Mortgage Loan which has become the subject of a
Debt Service Reduction, the portion, if any, of the reduction in each affected
Monthly Payment attributable to a reduction in the Mortgage Rate imposed by a
court of competent jurisdiction. Each such Realized Loss shall be deemed to have
been incurred on the Due Date for each affected Monthly Payment.
To the extent the related Servicer receives Subsequent Recoveries, with
respect to any Mortgage Loan, the amount of Realized Loss with respect to that
Mortgage Loan will be reduced to the extent such recoveries are applied to
reduce the Certificate Principal Balance of any Class of Certificates on any
Distribution Date.
"Record Date": With respect to each Distribution Date and the Class A
Certificates and the Mezzanine Certificates, the Business Day immediately
preceding such Distribution Date for so long as such Certificates are Book-Entry
Certificates. With respect to each Distribution Date and any other Class of
Certificates, including any Definitive Certificates, the last day of the
calendar month immediately preceding the month in which such Distribution Date
occurs.
"Reference Banks": Barclays Bank PLC, The Tokyo Mitsubishi Bank and
National Westminster Bank PLC and their successors in interest; provided,
however, that if any of the foregoing banks are not suitable to serve as a
Reference Bank, then any leading banks selected by the Securities Administrator
which are engaged in transactions in Eurodollar deposits in the International
Eurocurrency market (i) with an established place of business in London, (ii)
not controlling, under the control of or under common control with the Depositor
or any Affiliate thereof and (iii) which have been designated as such by the
Securities Administrator.
"Refinanced Mortgage Loan": A Mortgage Loan the proceeds of which were
not used to purchase the related Mortgaged Property.
"Regular Certificate": Any Class A Certificate, Mezzanine Certificate,
Class CE Certificate or Class P Certificate.
"Regular Interest": A "regular interest" in a REMIC within the meaning
of Section 860G(a)(1) of the Code.
"Relief Act": The Servicemembers Civil Relief Act, as amended, or
similar state or local laws.
"Relief Act Interest Shortfall": With respect to any Distribution Date
and any Mortgage Loan, any reduction in the amount of interest collectible on
such Mortgage Loan for the most recently ended Due Period as a result of the
application of the Relief Act.
"REMIC": A "real estate mortgage investment conduit" within the meaning
of Section 860D of the Code.
"REMIC I": The segregated pool of assets subject hereto, constituting
the primary trust created hereby and to be administered hereunder, with respect
to which a REMIC election is to be made, consisting of: (i) such Mortgage Loans
and Prepayment Charges as from time to time are subject to this Agreement,
together with the Mortgage Files relating thereto, and together with all
collections thereon and proceeds thereof; (ii) any REO Property, together with
all collections thereon and proceeds thereof; (iii) the Trustee's rights with
respect to the Mortgage Loans under all insurance policies required to be
maintained pursuant to this Agreement and any proceeds thereof; (iv) the
Depositor's rights under the Mortgage Loan Purchase Agreement (including any
security interest created thereby), the Servicing Agreement and the Assignment
Agreement, and (v) the Collection Accounts, the Custodial Account, the
Distribution Account and any REO Account, and such assets that are deposited
therein from time to time and any investments thereof, together with any and all
income, proceeds and payments with respect thereto. Notwithstanding the
foregoing, however, REMIC I specifically excludes (i) all payments and other
collections of principal and interest due on the Mortgage Loans on or before the
Cut-off Date and all Prepayment Charges payable in connection with Principal
Prepayments made before the Cut-off Date; (ii) the Reserve Fund and any amounts
on deposit therein from time to time and any proceeds thereof; (iii) the Swap
Agreement Contracts; and (iv) the Supplemental Interest Trust.
"REMIC I Group IA Regular Interests": REMIC I Regular Interest A-I and
REMIC I Regular Interest I-1-A through REMIC I Regular Interest I-46-B as
designated in the Preliminary Statement hereto.
"REMIC I Group IB Regular Interests": REMIC I Regular Interest A-II and
REMIC I Regular Interest II-1-A through REMIC I Regular Interest II-46-B as
designated in the Preliminary Statement hereto.
"REMIC I Group II Regular Interests": REMIC I Regular Interest A-III
and REMIC I Regular Interest III-1-A through REMIC I Regular Interest III-46-B
as designated in the Preliminary Statement hereto.
"REMIC I Regular Interest": Any of the 280 separate non-certificated
beneficial ownership interests in REMIC I issued hereunder and designated as a
"regular interest" in REMIC I. Each REMIC I Regular Interest shall accrue
interest at the related REMIC I Remittance Rate in effect from time to time, and
shall be entitled to distributions of principal, subject to the terms and
conditions hereof, in an aggregate amount equal to its initial Uncertificated
Balance as set forth in the Preliminary Statement hereto.
"REMIC I Remittance Rate": With respect to REMIC I Regular Interest
A-I, a per annum rate equal to the weighted average of the Net Mortgage Rates of
the Group IA Mortgage Loans. With respect to each REMIC I Group IA Regular
Interest ending with the designation "A", a per annum rate equal to the weighted
average of the Net Mortgage Rates of the Group IA Mortgage Loans multiplied by
2, subject to a maximum rate of 9.55%. With respect to each REMIC I Group IA
Regular Interest ending with the designation "B", the greater of (x) a per annum
rate equal to the excess, if any, of (i) 2 multiplied by the weighted average of
the Net Mortgage Rates of the Group IA Mortgage Loans over (ii) 9.55% and (y)
0.00%. With respect to REMIC I Regular Interest A-II, a per annum rate equal to
the weighted average of the Net Mortgage Rates of the Group IB Mortgage Loans.
With respect to each REMIC I Group IB Regular Interest ending with the
designation "A", a per annum rate equal to the weighted average of the Net
Mortgage Rates of the Group IB Mortgage Loans multiplied by 2, subject to a
maximum rate of 9.55%. With respect to each REMIC I Group IB Regular Interest
ending with the designation "B", the greater of (x) a per annum rate equal to
the excess, if any, of (i) 2 multiplied by the weighted average of the Net
Mortgage Rates of the Group IB Mortgage Loans over (ii) 9.55% and (y) 0.00%.
With respect to REMIC I Regular Interest A-III, a per annum rate equal to the
weighted average of the Net Mortgage Rates of the Group II Mortgage Loans. With
respect to each REMIC I Group II Regular Interest ending with the designation
"A", a per annum rate equal to the weighted average of the Net Mortgage Rates of
the Group II Mortgage Loans multiplied by 2, subject to a maximum rate of 9.55%.
With respect to each REMIC I Group II Regular Interest ending with the
designation "B", the greater of (x) a per annum rate equal to the excess, if
any, of (i) 2 multiplied by the weighted average of the Net Mortgage Rates of
the Group II Mortgage Loans over (ii) 9.55% and (y) 0.00%. With respect to REMIC
I Regular Interest P, 0.00%.
"REMIC II": The segregated pool of assets consisting of all of the
REMIC I Regular Interests conveyed in trust to the Trustee, for the benefit of
the REMIC II Regular Interests pursuant to Section 2.07, and all amounts
deposited therein, with respect to which a separate REMIC election is to be
made.
"REMIC II Interest Loss Allocation Amount": With respect to any
Distribution Date, an amount equal to (a) the product of (i) 50% of the
aggregate Stated Principal Balance of the Mortgage Loans and REO Properties then
outstanding and (ii) the REMIC II Remittance Rate for REMIC II Regular Interest
AA minus the Marker Rate, divided by (b) 12.
"REMIC II Marker Allocation Percentage": 50% of any amount payable or
loss attributable from the Mortgage Loans, which shall be allocated to REMIC II
Regular Interest AA, REMIC II Regular Interest A-1A, REMIC II Regular Interest
A-1B1, REMIC II Regular Interest A-1B2, REMIC II Regular Interest A-2A, REMIC II
Regular Interest A-2B, REMIC II Regular Interest A-2C, REMIC II Regular Interest
A-2D, REMIC II Regular Interest M-1, REMIC II Regular Interest M-2, REMIC II
Regular Interest M-3, REMIC II Regular Interest M-4, REMIC II Regular Interest
M-5, REMIC II Regular Interest M-6, REMIC II Regular Interest M-8, REMIC II
Regular Interest M-9, REMIC II Regular Interest M-10, REMIC II Regular Interest
M-11, REMIC II Regular Interest M-11, REMIC II Regular Interest ZZ and REMIC II
Regular Interest P.
"REMIC II Overcollateralization Amount": With respect to any date of
determination, (i) 0.50% of the aggregate Uncertificated Balances of the REMIC
II Regular Interests minus (ii) the aggregate of the Uncertificated Balances of
REMIC II Regular Interest A-1A, REMIC II Regular Interest A-1B1, REMIC II
Regular Interest A-1B2, REMIC II Regular Interest A-2A, REMIC II Regular
Interest A-2B, REMIC II Regular Interest A-2C, REMIC II Regular Interest A-2D,
REMIC II Regular Interest M-1, REMIC II Regular Interest M-2, REMIC II Regular
Interest M-3, REMIC II Regular Interest M-4, REMIC II Regular Interest M-5,
REMIC II Regular Interest M-6, REMIC II Regular Interest M-7, REMIC II Regular
Interest M-8, REMIC II Regular Interest M-9, REMIC II Regular Interest M-10,
REMIC II Regular Interest M-11 and REMIC II Regular Interest P, in each case as
of such date of determination.
"REMIC II Principal Loss Allocation Amount": With respect to any
Distribution Date, an amount equal to (a) the product of (i) 50% of the
aggregate Stated Principal Balance of the Mortgage Loans and REO Properties then
outstanding and (ii) 1 minus a fraction, the numerator of which is two times the
aggregate of the Uncertificated Balances of REMIC II Regular Interest A-1A,
REMIC II Regular Interest A-1B1, REMIC II Regular Interest A-1B2, REMIC II
Regular Interest A-2A, REMIC II Regular Interest A-2B, REMIC II Regular Interest
A-2C, REMIC II Regular Interest A-2D, REMIC II Regular Interest M-1, REMIC II
Regular Interest M-2, REMIC II Regular Interest M-3, REMIC II Regular Interest
M-4, REMIC II Regular Interest M-5, REMIC II Regular Interest M-6, REMIC II
Regular Interest M-7, REMIC II Regular Interest M-8, REMIC II Regular Interest
M-9, REMIC II Regular Interest M-10, REMIC II Regular Interest M-11 and the
denominator of which is the aggregate of the Uncertificated Balances of REMIC II
Regular Interest A-1A, REMIC II Regular Interest A-1B1, REMIC II Regular
Interest A-1B2, REMIC II Regular Interest A-2A, REMIC II Regular Interest A-2B,
REMIC II Regular Interest A-2C, REMIC II Regular Interest A-2D, REMIC II Regular
Interest M-1, REMIC II Regular Interest M-2, REMIC II Regular Interest M-3,
REMIC II Regular Interest M-4, REMIC II Regular Interest M-5, REMIC II Regular
Interest M-6, REMIC II Regular Interest M-7, REMIC II Regular Interest M-8,
REMIC II Regular Interest M-9, REMIC II Regular Interest M-10, REMIC II Regular
Interest M-11 and REMIC II Regular Interest ZZ.
"REMIC II Regular Interest": Any of the separate non-certificated
beneficial ownership interests in REMIC II issued hereunder and designated as a
"regular interest" in REMIC II. Each REMIC II Regular Interest shall accrue
interest at the related REMIC II Remittance Rate in effect from time to time,
and shall be entitled to distributions of principal, subject to the terms and
conditions hereof, in an aggregate amount equal to its initial Uncertificated
Balance as set forth in the Preliminary Statement hereto. The designations for
the respective REMIC II Regular Interests are set forth in the Preliminary
Statement hereto.
"REMIC II Regular Interest AA": One of the separate non-certificated
beneficial ownership interests in REMIC II issued hereunder and designated as a
Regular Interest in REMIC II. REMIC II Regular Interest AA shall accrue interest
at the related REMIC II Remittance Rate in effect from time to time, and shall
be entitled to distributions of principal, subject to the terms and conditions
hereof, in an aggregate amount equal to its initial Uncertificated Balance as
set forth in the Preliminary Statement hereto.
"REMIC II Regular Interest A-1A": One of the separate non-certificated
beneficial ownership interests in REMIC II issued hereunder and designated as a
Regular Interest in REMIC II. REMIC II Regular Interest A-1A shall accrue
interest at the related REMIC II Remittance Rate in effect from time to time,
and shall be entitled to distributions of principal, subject to the terms and
conditions hereof, in an aggregate amount equal to its initial Uncertificated
Balance as set forth in the Preliminary Statement hereto.
"REMIC II Regular Interest A-1B1": One of the separate non-certificated
beneficial ownership interests in REMIC II issued hereunder and designated as a
Regular Interest in REMIC II. REMIC II Regular Interest A-1B1 shall accrue
interest at the related REMIC II Remittance Rate in effect from time to time,
and shall be entitled to distributions of principal, subject to the terms and
conditions hereof, in an aggregate amount equal to its initial Uncertificated
Balance as set forth in the Preliminary Statement hereto.
"REMIC II Regular Interest A-1B2": One of the separate non-certificated
beneficial ownership interests in REMIC II issued hereunder and designated as a
Regular Interest in REMIC II. REMIC II Regular Interest A-1B2 shall accrue
interest at the related REMIC II Remittance Rate in effect from time to time,
and shall be entitled to distributions of principal, subject to the terms and
conditions hereof, in an aggregate amount equal to its initial Uncertificated
Balance as set forth in the Preliminary Statement hereto.
"REMIC II Regular Interest A-2A": One of the separate non-certificated
beneficial ownership interests in REMIC II issued hereunder and designated as a
Regular Interest in REMIC II. REMIC II Regular Interest A-2A shall accrue
interest at the related REMIC II Remittance Rate in effect from time to time,
and shall be entitled to distributions of principal, subject to the terms and
conditions hereof, in an aggregate amount equal to its initial Uncertificated
Balance as set forth in the Preliminary Statement hereto.
"REMIC II Regular Interest A-2B": One of the separate non-certificated
beneficial ownership interests in REMIC II issued hereunder and designated as a
Regular Interest in REMIC II. REMIC II Regular Interest A-2B shall accrue
interest at the related REMIC II Remittance Rate in effect from time to time,
and shall be entitled to distributions of principal, subject to the terms and
conditions hereof, in an aggregate amount equal to its initial Uncertificated
Balance as set forth in the Preliminary Statement hereto.
"REMIC II Regular Interest A-2C": One of the separate non-certificated
beneficial ownership interests in REMIC II issued hereunder and designated as a
Regular Interest in REMIC II. REMIC II Regular Interest A-2C shall accrue
interest at the related REMIC II Remittance Rate in effect from time to time,
and shall be entitled to distributions of principal, subject to the terms and
conditions hereof, in an aggregate amount equal to its initial Uncertificated
Balance as set forth in the Preliminary Statement hereto.
"REMIC II Regular Interest A-2D": One of the separate non-certificated
beneficial ownership interests in REMIC II issued hereunder and designated as a
Regular Interest in REMIC II. REMIC II Regular Interest A-2D shall accrue
interest at the related REMIC II Remittance Rate in effect from time to time,
and shall be entitled to distributions of principal, subject to the terms and
conditions hereof, in an aggregate amount equal to its initial Uncertificated
Balance as set forth in the Preliminary Statement hereto.
"REMIC II Regular Interest IO": One of the separate non-certificated
beneficial ownership interests in REMIC II issued hereunder and designated as a
Regular Interest in REMIC II. REMIC II Regular Interest IO shall accrue interest
at the related REMIC II Remittance Rate in effect from time to time and shall
not be entitled to distributions of principal.
"REMIC II Regular Interest M-1": One of the separate non-certificated
beneficial ownership interests in REMIC II issued hereunder and designated as a
Regular Interest in REMIC II. REMIC II Regular Interest M-1 shall accrue
interest at the related REMIC II Remittance Rate in effect from time to time,
and shall be entitled to distributions of principal, subject to the terms and
conditions hereof, in an aggregate amount equal to its initial Uncertificated
Balance as set forth in the Preliminary Statement hereto.
"REMIC II Regular Interest M-2": One of the separate non-certificated
beneficial ownership interests in REMIC II issued hereunder and designated as a
Regular Interest in REMIC II. REMIC II Regular Interest M-2 shall accrue
interest at the related REMIC II Remittance Rate in effect from time to time,
and shall be entitled to distributions of principal, subject to the terms and
conditions hereof, in an aggregate amount equal to its initial Uncertificated
Balance as set forth in the Preliminary Statement hereto.
"REMIC II Regular Interest M-3": One of the separate non-certificated
beneficial ownership interests in REMIC II issued hereunder and designated as a
Regular Interest in REMIC II. REMIC II Regular Interest M-3 shall accrue
interest at the related REMIC II Remittance Rate in effect from time to time,
and shall be entitled to distributions of principal, subject to the terms and
conditions hereof, in an aggregate amount equal to its initial Uncertificated
Balance as set forth in the Preliminary Statement hereto.
"REMIC II Regular Interest M-4": One of the separate non-certificated
beneficial ownership interests in REMIC II issued hereunder and designated as a
Regular Interest in REMIC II. REMIC II Regular Interest M-4 shall accrue
interest at the related REMIC II Remittance Rate in effect from time to time,
and shall be entitled to distributions of principal, subject to the terms and
conditions hereof, in an aggregate amount equal to its initial Uncertificated
Balance as set forth in the Preliminary Statement hereto.
"REMIC II Regular Interest M-5": One of the separate non-certificated
beneficial ownership interests in REMIC II issued hereunder and designated as a
Regular Interest in REMIC II. REMIC II Regular Interest M-5 shall accrue
interest at the related REMIC II Remittance Rate in effect from time to time,
and shall be entitled to distributions of principal, subject to the terms and
conditions hereof, in an aggregate amount equal to its initial Uncertificated
Balance as set forth in the Preliminary Statement hereto.
"REMIC II Regular Interest M-6": One of the separate non-certificated
beneficial ownership interests in REMIC II issued hereunder and designated as a
Regular Interest in REMIC II. REMIC II Regular Interest M-6 shall accrue
interest at the related REMIC II Remittance Rate in effect from time to time,
and shall be entitled to distributions of principal, subject to the terms and
conditions hereof, in an aggregate amount equal to its initial Uncertificated
Balance as set forth in the Preliminary Statement hereto.
"REMIC II Regular Interest M-7": One of the separate non-certificated
beneficial ownership interests in REMIC II issued hereunder and designated as a
Regular Interest in REMIC II. REMIC II Regular Interest M-7 shall accrue
interest at the related REMIC II Remittance Rate in effect from time to time,
and shall be entitled to distributions of principal, subject to the terms and
conditions hereof, in an aggregate amount equal to its initial Uncertificated
Balance as set forth in the Preliminary Statement hereto.
"REMIC II Regular Interest M-8": One of the separate non-certificated
beneficial ownership interests in REMIC II issued hereunder and designated as a
Regular Interest in REMIC II. REMIC II Regular Interest M-8 shall accrue
interest at the related REMIC II Remittance Rate in effect from time to time,
and shall be entitled to distributions of principal, subject to the terms and
conditions hereof, in an aggregate amount equal to its initial Uncertificated
Balance as set forth in the Preliminary Statement hereto.
"REMIC II Regular Interest M-9": One of the separate non-certificated
beneficial ownership interests in REMIC II issued hereunder and designated as a
Regular Interest in REMIC II. REMIC II Regular Interest M-9 shall accrue
interest at the related REMIC II Remittance Rate in effect from time to time,
and shall be entitled to distributions of principal, subject to the terms and
conditions hereof, in an aggregate amount equal to its initial Uncertificated
Balance as set forth in the Preliminary Statement hereto.
"REMIC II Regular Interest M-10": One of the separate non-certificated
beneficial ownership interests in REMIC II issued hereunder and designated as a
Regular Interest in REMIC II. REMIC II Regular Interest M-10 shall accrue
interest at the related REMIC II Remittance Rate in effect from time to time,
and shall be entitled to distributions of principal, subject to the terms and
conditions hereof, in an aggregate amount equal to its initial Uncertificated
Balance as set forth in the Preliminary Statement hereto.
"REMIC II Regular Interest M-11": One of the separate non-certificated
beneficial ownership interests in REMIC II issued hereunder and designated as a
Regular Interest in REMIC II. REMIC II Regular Interest M-11 shall accrue
interest at the related REMIC II Remittance Rate in effect from time to time,
and shall be entitled to distributions of principal, subject to the terms and
conditions hereof, in an aggregate amount equal to its initial Uncertificated
Balance as set forth in the Preliminary Statement hereto.
"REMIC II Regular Interest P": One of the separate non-certificated
beneficial ownership interests in REMIC II issued hereunder and designated as a
Regular Interest in REMIC II. REMIC II Regular Interest P shall accrue interest
at the related REMIC II Remittance Rate in effect from time to time, and shall
be entitled to distributions of principal, subject to the terms and conditions
hereof, in an aggregate amount equal to its initial Uncertificated Balance as
set forth in the Preliminary Statement hereto.
"REMIC II Regular Interest XX": One of the separate non-certificated
beneficial ownership interests in REMIC II issued hereunder and designated as a
Regular Interest in REMIC II. REMIC II Regular Interest XX shall accrue interest
at the related REMIC II Remittance Rate in effect from time to time, and shall
be entitled to distributions of principal, subject to the terms and conditions
hereof, in an aggregate amount equal to its initial Uncertificated Balance as
set forth in the Preliminary Statement hereto.
"REMIC II Regular Interest ZZ": One of the separate non-certificated
beneficial ownership interests in REMIC II issued hereunder and designated as a
Regular Interest in REMIC II. REMIC II Regular Interest ZZ shall accrue interest
at the related REMIC II Remittance Rate in effect from time to time, and shall
be entitled to distributions of principal, subject to the terms and conditions
hereof, in an aggregate amount equal to its initial Uncertificated Balance as
set forth in the Preliminary Statement hereto.
"REMIC II Regular Interest IA-SUB": One of the separate
non-certificated beneficial ownership interests in REMIC II issued hereunder and
designated as a Regular Interest in REMIC II. REMIC II Regular Interest IA-SUB
shall accrue interest at the related REMIC II Remittance Rate in effect from
time to time, and shall be entitled to distributions of principal, subject to
the terms and conditions hereof, in an aggregate amount equal to its initial
Uncertificated Balance as set forth in the Preliminary Statement hereto.
"REMIC II Regular Interest IA-GRP": One of the separate
non-certificated beneficial ownership interests in REMIC II issued hereunder and
designated as a Regular Interest in REMIC II. REMIC II Regular Interest IA-GRP
shall accrue interest at the related REMIC II Remittance Rate in effect from
time to time, and shall be entitled to distributions of principal, subject to
the terms and conditions hereof, in an aggregate amount equal to its initial
Uncertificated Balance as set forth in the Preliminary Statement hereto.
"REMIC II Regular Interest IB-SUB": One of the separate
non-certificated beneficial ownership interests in REMIC II issued hereunder and
designated as a Regular Interest in REMIC II. REMIC II Regular Interest IB-SUB
shall accrue interest at the related REMIC II Remittance Rate in effect from
time to time, and shall be entitled to distributions of principal, subject to
the terms and conditions hereof, in an aggregate amount equal to its initial
Uncertificated Balance as set forth in the Preliminary Statement hereto.
"REMIC II Regular Interest IB-GRP": One of the separate
non-certificated beneficial ownership interests in REMIC II issued hereunder and
designated as a Regular Interest in REMIC II. REMIC II Regular Interest IB-GRP
shall accrue interest at the related REMIC II Remittance Rate in effect from
time to time, and shall be entitled to distributions of principal, subject to
the terms and conditions hereof, in an aggregate amount equal to its initial
Uncertificated Balance as set forth in the Preliminary Statement hereto.
"REMIC II Regular Interest II-SUB": One of the separate
non-certificated beneficial ownership interests in REMIC II issued hereunder and
designated as a Regular Interest in REMIC II. REMIC II Regular Interest II-SUB
shall accrue interest at the related REMIC II Remittance Rate in effect from
time to time, and shall be entitled to distributions of principal, subject to
the terms and conditions hereof, in an aggregate amount equal to its initial
Uncertificated Balance as set forth in the Preliminary Statement hereto.
"REMIC II Regular Interest II-GRP": One of the separate
non-certificated beneficial ownership interests in REMIC II issued hereunder and
designated as a Regular Interest in REMIC II. REMIC II Regular Interest II-GRP
shall accrue interest at the related REMIC II Remittance Rate in effect from
time to time, and shall be entitled to distributions of principal, subject to
the terms and conditions hereof, in an aggregate amount equal to its initial
Uncertificated Balance as set forth in the Preliminary Statement hereto.
"REMIC II Remittance Rate": With respect to REMIC II Regular Interest
AA, REMIC II Regular Interest A-1A, REMIC II Regular Interest A-1B1, REMIC II
Regular Interest A-1B2, REMIC II Regular Interest A-2A, REMIC II Regular
Interest A-2B, REMIC II Regular Interest A-2C, REMIC II Regular Interest A-2D,
REMIC II Regular Interest M-1, REMIC II Regular Interest M-2, REMIC II Regular
Interest M-3, REMIC II Regular Interest M-4, REMIC II Regular Interest M-5,
REMIC II Regular Interest M-6, REMIC II Regular Interest M-7, REMIC II Regular
Interest M-8, REMIC II Regular Interest M-9, REMIC II Regular Interest M-10,
REMIC II Regular Interest M-11, REMIC II Regular Interest ZZ, REMIC II Regular
Interest IA-SUB, REMIC II Regular Interest IB-SUB, REMIC II Regular Interest
II-SUB and REMIC II Regular Interest XX, a per annum rate (but not less than
zero) equal to the weighted average of: (w) with respect to REMIC I Regular
Interest A-I, REMIC I Regular Interest A-II and REMIC I Regular Interest A-III,
the REMIC I Remittance Rate for each such REMIC I Regular Interest for each such
Distribution Date, (x) with respect to each REMIC I Regular Interest ending with
the designation "B", the weighted average of the REMIC I Remittance Rates for
such REMIC I Regular Interests, weighted on the basis of the Uncertificated
Balances of such REMIC I Regular Interests for each such Distribution Date and
(y) with respect to REMIC I Regular Interests ending with the designation "A",
for each Distribution Date listed below, the weighted average of the rates
listed below for each such REMIC I Regular Interest listed below, weighted on
the basis of the Uncertificated Balances of each such REMIC I Regular Interest
for each such Distribution Date:
DISTRIBUTION
DATE REMIC I REGULAR INTEREST RATE
1 I-1-A through I-46-A 2 multiplied by Swap LIBOR, subject to a maximum rate of
REMIC I Remittance Rate
II-1-A through II-46-A 2 multiplied by Swap LIBOR, subject to a maximum rate of
REMIC I Remittance Rate
III-1-A through III-46-A 2 multiplied by Swap LIBOR, subject to a maximum rate of
REMIC I Remittance Rate
2 I-2-A through I-46-A 2 multiplied by Swap LIBOR, subject to a maximum rate of
REMIC I Remittance Rate
II-2-A through II-46-A 2 multiplied by Swap LIBOR, subject to a maximum rate
REMIC I Remittance Rate
III-2-A through III-46-A 2 multiplied by Swap LIBOR, subject to a maximum rate
REMIC I Remittance Rate
I-1-A REMIC I Remittance Rate
II-1-A REMIC I Remittance Rate
III-1-A REMIC I Remittance Rate
3 I-3-A through I-46-A 2 multiplied by Swap LIBOR, subject to a maximum rate of
REMIC I Remittance Rate
II-3-A through II-46-A 2 multiplied by Swap LIBOR, subject to a maximum rate of
REMIC I Remittance Rate
III-3-A through III-46-A 2 multiplied by Swap LIBOR, subject to a maximum rate of
REMIC I Remittance Rate
I-1-A and I-2-A REMIC I Remittance Rate
II-1-A and II-2-A REMIC I Remittance Rate
III-1-A and III-2-A REMIC I Remittance Rate
4 I-4-A through I-46-A 2 multiplied by Swap LIBOR, subject to a maximum rate of
REMIC I Remittance Rate
II-4-A through II-46-A 2 multiplied by Swap LIBOR, subject to a maximum rate of
REMIC I Remittance Rate
III-4-A through III-46-A 2 multiplied by Swap LIBOR, subject to a maximum rate of
REMIC I Remittance Rate
I-1-A through I-3-A REMIC I Remittance Rate
II-1-A through II-3-A REMIC I Remittance Rate
III-1-A through III-3-A REMIC I Remittance Rate
5 I-5-A through I-46-A 2 multiplied by Swap LIBOR, subject to a maximum rate of
REMIC I Remittance Rate
II-5-A through II-46-A 2 multiplied by Swap LIBOR, subject to a maximum rate of
REMIC I Remittance Rate
III-5-A through III-46-A 2 multiplied by Swap LIBOR, subject to a maximum rate of
REMIC I Remittance Rate
I-1-A through I-4-A REMIC I Remittance Rate
II-1-A through II-4-A REMIC I Remittance Rate
III-1-A through III-4-A REMIC I Remittance Rate
6 I-6-A through I-46-A 2 multiplied by Swap LIBOR, subject to a maximum rate of
REMIC I Remittance Rate
II-6-A through II-46-A 2 multiplied by Swap LIBOR, subject to a maximum rate of
REMIC I Remittance Rate
III-6-A through III-46-A 2 multiplied by Swap LIBOR, subject to a maximum rate of
REMIC I Remittance Rate
I-1-A through I-5-A REMIC I Remittance Rate
II-1-A through II-5-A REMIC I Remittance Rate
III-1-A through III-5-A REMIC I Remittance Rate
7 I-7-A through I-46-A 2 multiplied by Swap LIBOR, subject to a maximum rate of
REMIC I Remittance Rate
II-7-A through II-46-A 2 multiplied by Swap LIBOR, subject to a maximum rate of
REMIC I Remittance Rate
III-7-A through III-46-A 2 multiplied by Swap LIBOR, subject to a maximum rate of
REMIC I Remittance Rate
I-1-A through I-6-A REMIC I Remittance Rate
III-1-A through III-6-A REMIC I Remittance Rate
II-1-A through II-6-A REMIC I Remittance Rate
8 I-8-A through I-46-A 2 multiplied by Swap LIBOR, subject to a maximum rate of
REMIC I Remittance Rate
II-8-A through II-46-A 2 multiplied by Swap LIBOR, subject to a maximum rate of
REMIC I Remittance Rate
III-8-A through III-46-A 2 multiplied by Swap LIBOR, subject to a maximum rate of
REMIC I Remittance Rate
I-1-A through I-7-A REMIC I Remittance Rate
II-1-A through II-7-A REMIC I Remittance Rate
III-1-A through III-7-A REMIC I Remittance Rate
9 I-9-A through I-46-A 2 multiplied by Swap LIBOR, subject to a maximum rate of
REMIC I Remittance Rate
II-9-A through II-46-A 2 multiplied by Swap LIBOR, subject to a maximum rate of
REMIC I Remittance Rate
III-9-A through III-46-A 2 multiplied by Swap LIBOR, subject to a maximum rate of
REMIC I Remittance Rate
I-1-A through I-8-A REMIC I Remittance Rate
II-1-A through II-8-A REMIC I Remittance Rate
III-1-A through III-8-A REMIC I Remittance Rate
10 I-10-A through I-46-A 2 multiplied by Swap LIBOR, subject to a maximum rate of
REMIC I Remittance Rate
II-10-A through II-46-A 2 multiplied by Swap LIBOR, subject to a maximum rate of
REMIC I Remittance Rate
III-10-A through III-46-A 2 multiplied by Swap LIBOR, subject to a maximum rate of
REMIC I Remittance Rate
I-1-A through I-9-A REMIC I Remittance Rate
II-1-A through II-9-A REMIC I Remittance Rate
III-1-A through III-9-A REMIC I Remittance Rate
11 I-11-A through I-46-A 2 multiplied by Swap LIBOR, subject to a maximum rate of
REMIC I Remittance Rate
II-11-A through II-46-A 2 multiplied by Swap LIBOR, subject to a maximum rate of
REMIC I Remittance Rate
III-11-A through III-46-A 2 multiplied by Swap LIBOR, subject to a maximum rate of
REMIC I Remittance Rate
I-1-A through I-10-A REMIC I Remittance Rate
II-1-A through II-10-A REMIC I Remittance Rate
III-1-A through III-10-A REMIC I Remittance Rate
12 I-12-A through I-46-A 2 multiplied by Swap LIBOR, subject to a maximum rate of
REMIC I Remittance Rate
II-12-A through II-46-A 2 multiplied by Swap LIBOR, subject to a maximum rate of
REMIC I Remittance Rate
III-12-A through III-46-A 2 multiplied by Swap LIBOR, subject to a maximum rate of
REMIC I Remittance Rate
I-1-A through I-11-A REMIC I Remittance Rate
II-1-A through II-11-A REMIC I Remittance Rate
III-1-A through III-11-A REMIC I Remittance Rate
13 I-13-A through I-46-A 2 multiplied by Swap LIBOR, subject to a maximum rate of
REMIC I Remittance Rate
II-13-A through II-46-A 2 multiplied by Swap LIBOR, subject to a maximum rate of
REMIC I Remittance Rate
III-13-A through III-46-A 2 multiplied by Swap LIBOR, subject to a maximum rate of
REMIC I Remittance Rate
I-1-A through I-12-A REMIC I Remittance Rate
II-1-A through II-12-A REMIC I Remittance Rate
III-1-A through III-12-A REMIC I Remittance Rate
14 I-14-A through I-46-A 2 multiplied by Swap LIBOR, subject to a maximum rate of
REMIC I Remittance Rate
II-14-A through II-46-A 2 multiplied by Swap LIBOR, subject to a maximum rate of
REMIC I Remittance Rate
2 multiplied by Swap LIBOR, subject to a maximum rate of
III-14-A through III-46-A REMIC I Remittance Rate
I-1-A through I-13-A REMIC I Remittance Rate
II-1-A through II-13-A REMIC I Remittance Rate
III-1-A through III-13-A REMIC I Remittance Rate
15 I-15-A through I-46-A 2 multiplied by Swap LIBOR, subject to a maximum rate of
REMIC I Remittance Rate
II-15-A through II-46-A 2 multiplied by Swap LIBOR, subject to a maximum rate of
REMIC I Remittance Rate
III-15-A through III-46-A 2 multiplied by Swap LIBOR, subject to a maximum rate of
REMIC I Remittance Rate
I-1-A through I-14-A REMIC I Remittance Rate
II-1-A through II-14-A REMIC I Remittance Rate
III-1-A through III-14-A REMIC I Remittance Rate
16 I-16-A through I-46-A 2 multiplied by Swap LIBOR, subject to a maximum rate of
REMIC I Remittance Rate
II-16-A through II-46-A 2 multiplied by Swap LIBOR, subject to a maximum rate of
REMIC I Remittance Rate
III-16-A through III-46-A 2 multiplied by Swap LIBOR, subject to a maximum rate of
REMIC I Remittance Rate
I-1-A through I-15-A REMIC I Remittance Rate
II-1-A through II-15-A REMIC I Remittance Rate
III-1-A through III-15-A REMIC I Remittance Rate
17 I-17-A through I-46-A 2 multiplied by Swap LIBOR, subject to a maximum rate of
REMIC I Remittance Rate
II-17-A through II-46-A 2 multiplied by Swap LIBOR, subject to a maximum rate of
REMIC I Remittance Rate
III-17-A through III-46-A 2 multiplied by Swap LIBOR, subject to a maximum rate of
REMIC I Remittance Rate
I-1-A through I-16-A REMIC I Remittance Rate
II-1-A through II-16-A REMIC I Remittance Rate
III-1-A through III-16-A REMIC I Remittance Rate
18 I-18-A through I-46-A 2 multiplied by Swap LIBOR, subject to a maximum rate of
REMIC I Remittance Rate
II-18-A through II-46-A 2 multiplied by Swap LIBOR, subject to a maximum rate of
REMIC I Remittance Rate
III-18-A through III-46-A 2 multiplied by Swap LIBOR, subject to a maximum rate of
REMIC I Remittance Rate
I-1-A through I-17-A REMIC I Remittance Rate
II-1-A through II-17-A REMIC I Remittance Rate
III-1-A through III-17-A REMIC I Remittance Rate
19 I-19-A through I-46-A 2 multiplied by Swap LIBOR, subject to a maximum rate of
REMIC I Remittance Rate
II-19-A through II-46-A 2 multiplied by Swap LIBOR, subject to a maximum rate of
REMIC I Remittance Rate
III-19-A through III-46-A 2 multiplied by Swap LIBOR, subject to a maximum rate of
REMIC I Remittance Rate
I-1-A through I-18-A REMIC I Remittance Rate
II-1-A through II-18-A REMIC I Remittance Rate
III-1-A through III-18-A REMIC I Remittance Rate
20 I-20-A through I-46-A 2 multiplied by Swap LIBOR, subject to a maximum rate of
REMIC I Remittance Rate
II-20-A through II-46-A 2 multiplied by Swap LIBOR, subject to a maximum rate of
REMIC I Remittance Rate
III-20-A through III-46-A 2 multiplied by Swap LIBOR, subject to a maximum rate of
REMIC I Remittance Rate
I-1-A through I-19-A REMIC I Remittance Rate
II-1-A through II-19-A REMIC I Remittance Rate
III-1-A through III-19-A REMIC I Remittance Rate
21 I-21-A through I-46-A 2 multiplied by Swap LIBOR, subject to a maximum rate of
REMIC I Remittance Rate
II-21-A through II-46-A 2 multiplied by Swap LIBOR, subject to a maximum rate of
REMIC I Remittance Rate
III-21-A through III-46-A 2 multiplied by Swap LIBOR, subject to a maximum rate of
REMIC I Remittance Rate
I-1-A through I-20-A REMIC I Remittance Rate
II-1-A through II-20-A REMIC I Remittance Rate
III-1-A through III-20-A REMIC I Remittance Rate
22 I-22-A through I-46-A 2 multiplied by Swap LIBOR, subject to a maximum rate of
REMIC I Remittance Rate
II-22-A through II-46-A 2 multiplied by Swap LIBOR, subject to a maximum rate of
REMIC I Remittance Rate
III-22-A through III-46-A 2 multiplied by Swap LIBOR, subject to a maximum rate of
REMIC I Remittance Rate
I-1-A through I-21-A REMIC I Remittance Rate
II-1-A through II-21-A REMIC I Remittance Rate
III-1-A through III-21-A REMIC I Remittance Rate
23 I-23-A through I-46-A 2 multiplied by Swap LIBOR, subject to a maximum rate of
REMIC I Remittance Rate
II-23-A through II-46-A 2 multiplied by Swap LIBOR, subject to a maximum rate of
REMIC I Remittance Rate
III-23-A through III-46-A 2 multiplied by Swap LIBOR, subject to a maximum rate of
REMIC I Remittance Rate
I-1-A through I-22-A REMIC I Remittance Rate
II-1-A through II-22-A REMIC I Remittance Rate
III-1-A through III-22-A REMIC I Remittance Rate
24 I-24-A through I-46-A 2 multiplied by Swap LIBOR, subject to a maximum rate of
REMIC I Remittance Rate
II-24-A through II-46-A 2 multiplied by Swap LIBOR, subject to a maximum rate of
REMIC I Remittance Rate
III-24-A through III-46-A 2 multiplied by Swap LIBOR, subject to a maximum rate of
REMIC I Remittance Rate
I-1-A through I-23-A REMIC I Remittance Rate
II-1-A through II-23-A REMIC I Remittance Rate
III-1-A through III-23-A REMIC I Remittance Rate
25 I-25-A through I-46-A 2 multiplied by Swap LIBOR, subject to a maximum rate of
REMIC I Remittance Rate
II-25-A through II-46-A 2 multiplied by Swap LIBOR, subject to a maximum rate of
REMIC I Remittance Rate
III-25-A through III-46-A 2 multiplied by Swap LIBOR, subject to a maximum rate of
REMIC I Remittance Rate
I-1-A through I-24-A REMIC I Remittance Rate
II-1-A through II-24-A REMIC I Remittance Rate
III-1-A through III-24-A REMIC I Remittance Rate
26 I-26-A through I-46-A 2 multiplied by Swap LIBOR, subject to a maximum rate of
REMIC I Remittance Rate
II-26-A through II-46-A 2 multiplied by Swap LIBOR, subject to a maximum rate of
REMIC I Remittance Rate
III-26-A through III-46-A 2 multiplied by Swap LIBOR, subject to a maximum rate of
REMIC I Remittance Rate
I-1-A through I-25-A REMIC I Remittance Rate
II-1-A through II-25-A REMIC I Remittance Rate
III-1-A through III-25-A REMIC I Remittance Rate
27 I-27-A through I-46-A 2 multiplied by Swap LIBOR, subject to a maximum rate of
REMIC I Remittance Rate
II-27-A through II-46-A 2 multiplied by Swap LIBOR, subject to a maximum rate of
REMIC I Remittance Rate
III-27-A through III-46-A 2 multiplied by Swap LIBOR, subject to a maximum rate of
REMIC I Remittance Rate
I-1-A through I-26-A REMIC I Remittance Rate
II-1-A through II-26-A REMIC I Remittance Rate
III-1-A through III-26-A REMIC I Remittance Rate
28 I-28-A through I-46-A 2 multiplied by Swap LIBOR, subject to a maximum rate of
REMIC I Remittance Rate
II-28-A through II-46-A 2 multiplied by Swap LIBOR, subject to a maximum rate of
REMIC I Remittance Rate
III-28-A through III-46-A 2 multiplied by Swap LIBOR, subject to a maximum rate of
REMIC I Remittance Rate
I-1-A through I-27-A REMIC I Remittance Rate
II-1-A through II-27-A REMIC I Remittance Rate
III-1-A through III-27-A REMIC I Remittance Rate
29 I-29-A through I-46-A 2 multiplied by Swap LIBOR, subject to a maximum rate of
REMIC I Remittance Rate
II-29-A through II-46-A 2 multiplied by Swap LIBOR, subject to a maximum rate of
REMIC I Remittance Rate
III-29-A through III-46-A 2 multiplied by Swap LIBOR, subject to a maximum rate of
REMIC I Remittance Rate
I-1-A through I-28-A REMIC I Remittance Rate
II-29-A through II-46-A 2 multiplied by Swap LIBOR, subject to a maximum rate of
REMIC I Remittance Rate
III-29-A through III-46-A 2 multiplied by Swap LIBOR, subject to a maximum rate of
REMIC I Remittance Rate
30 I-30-A through I-46-A 2 multiplied by Swap LIBOR, subject to a maximum rate of
REMIC I Remittance Rate
II-30-A through II-46-A 2 multiplied by Swap LIBOR, subject to a maximum rate of
REMIC I Remittance Rate
III-30-A through III-46-A 2 multiplied by Swap LIBOR, subject to a maximum rate of
REMIC I Remittance Rate
I-1-A through I-29-A REMIC I Remittance Rate
II-1-A through II-29-A REMIC I Remittance Rate
III-1-A through III-29-A REMIC I Remittance Rate
31 I-31-A through I-46-A 2 multiplied by Swap LIBOR, subject to a maximum rate of
REMIC I Remittance Rate
II-31-A through II-46-A 2 multiplied by Swap LIBOR, subject to a maximum rate of
REMIC I Remittance Rate
III-31-A through III-46-A 2 multiplied by Swap LIBOR, subject to a maximum rate of
REMIC I Remittance Rate
I-1-A through I-30-A REMIC I Remittance Rate
II-1-A through II-30-A REMIC I Remittance Rate
III-1-A through III-30-A REMIC I Remittance Rate
32 I-32-A through I-46-A 2 multiplied by Swap LIBOR, subject to a maximum rate of
REMIC I Remittance Rate
II-32-A through II-46-A 2 multiplied by Swap LIBOR, subject to a maximum rate of
REMIC I Remittance Rate
III-32-A through III-46-A 2 multiplied by Swap LIBOR, subject to a maximum rate of
REMIC I Remittance Rate
I-1-A through I-31-A REMIC I Remittance Rate
II-1-A through II-31-A REMIC I Remittance Rate
III-1-A through III-31-A REMIC I Remittance Rate
33 I-33-A through I-46-A 2 multiplied by Swap LIBOR, subject to a maximum rate of
REMIC I Remittance Rate
II-33-A through II-46-A 2 multiplied by Swap LIBOR, subject to a maximum rate of
REMIC I Remittance Rate
III-33-A through III-46-A 2 multiplied by Swap LIBOR, subject to a maximum rate of
REMIC I Remittance Rate
I-1-A through I-32-A REMIC I Remittance Rate
II-1-A through II-32-A REMIC I Remittance Rate
III-1-A through III-32-A REMIC I Remittance Rate
34 I-34-A through I-46-A 2 multiplied by Swap LIBOR, subject to a maximum rate of
REMIC I Remittance Rate
II-34-A through II-46-A 2 multiplied by Swap LIBOR, subject to a maximum rate of
REMIC I Remittance Rate
III-34-A through III-46-A 2 multiplied by Swap LIBOR, subject to a maximum rate of
REMIC I Remittance Rate
I-1-A through I-33-A REMIC I Remittance Rate
II-1-A through II-33-A REMIC I Remittance Rate
III-1-A through III-33-A REMIC I Remittance Rate
35 I-35-A through I-46-A 2 multiplied by Swap LIBOR, subject to a maximum rate of
REMIC I Remittance Rate
II-35-A through II-46-A 2 multiplied by Swap LIBOR, subject to a maximum rate of
REMIC I Remittance Rate
III-35-A through III-46-A 2 multiplied by Swap LIBOR, subject to a maximum rate of
REMIC I Remittance Rate
I-1-A through I-34-A REMIC I Remittance Rate
II-1-A through II-34-A REMIC I Remittance Rate
III-1-A through III-34-A REMIC I Remittance Rate
36 I-36-A through I-46-A 2 multiplied by Swap LIBOR, subject to a maximum rate of
REMIC I Remittance Rate
II-36-A through II-46-A 2 multiplied by Swap LIBOR, subject to a maximum rate of
REMIC I Remittance Rate
III-36-A through III-46-A 2 multiplied by Swap LIBOR, subject to a maximum rate of
REMIC I Remittance Rate
I-1-A through I-35-A REMIC I Remittance Rate
II-1-A through II-35-A REMIC I Remittance Rate
III-1-A through III-35-A REMIC I Remittance Rate
37 I-37-A through I-46-A 2 multiplied by Swap LIBOR, subject to a maximum rate of
REMIC I Remittance Rate
II-37-A through II-46-A 2 multiplied by Swap LIBOR, subject to a maximum rate of
REMIC I Remittance Rate
III-37-A through III-46-A 2 multiplied by Swap LIBOR, subject to a maximum rate of
REMIC I Remittance Rate
I-1-A through I-36-A REMIC I Remittance Rate
II-1-A through II-36-A REMIC I Remittance Rate
III-1-A through III-36-A REMIC I Remittance Rate
38 I-38-A through I-46-A 2 multiplied by Swap LIBOR, subject to a maximum rate of
REMIC I Remittance Rate
II-38-A through II-46-A 2 multiplied by Swap LIBOR, subject to a maximum rate of
REMIC I Remittance Rate
III-38-A through III-46-A 2 multiplied by Swap LIBOR, subject to a maximum rate of
REMIC I Remittance Rate
I-1-A through I-37-A REMIC I Remittance Rate
II-1-A through II-37-A REMIC I Remittance Rate
III-1-A through III-37-A REMIC I Remittance Rate
39 I-39-A through I-46-A 2 multiplied by Swap LIBOR, subject to a maximum rate of
REMIC I Remittance Rate
II-39-A through II-46-A 2 multiplied by Swap LIBOR, subject to a maximum rate of
REMIC I Remittance Rate
III-39-A through III-46-A 2 multiplied by Swap LIBOR, subject to a maximum rate of
REMIC I Remittance Rate
I-1-A through I-38-A REMIC I Remittance Rate
II-1-A through II-38-A REMIC I Remittance Rate
III-1-A through III-38-A REMIC I Remittance Rate
40 I-40-A through I-46-A 2 multiplied by Swap LIBOR, subject to a maximum rate of
REMIC I Remittance Rate
II-40-A through II-46-A 2 multiplied by Swap LIBOR, subject to a maximum rate of
REMIC I Remittance Rate
III-40-A through III-46-A 2 multiplied by Swap LIBOR, subject to a maximum rate of
REMIC I Remittance Rate
I-1-A through I-39-A REMIC I Remittance Rate
II-1-A through II-39-A REMIC I Remittance Rate
III-1-A through III-39-A REMIC I Remittance Rate
41 I-41-A through I-46-A 2 multiplied by Swap LIBOR, subject to a maximum rate of
REMIC I Remittance Rate
II-41-A through II-46-A 2 multiplied by Swap LIBOR, subject to a maximum rate of
REMIC I Remittance Rate
III-41-A through III-46-A 2 multiplied by Swap LIBOR, subject to a maximum rate of
REMIC I Remittance Rate
I-1-A through I-40-A REMIC I Remittance Rate
II-1-A through II-40-A REMIC I Remittance Rate
III-1-A through III-40-A REMIC I Remittance Rate
42 I-42-A through I-46-A 2 multiplied by Swap LIBOR, subject to a maximum rate of
REMIC I Remittance Rate
II-42-A through II-46-A 2 multiplied by Swap LIBOR, subject to a maximum rate of
REMIC I Remittance Rate
III-42-A through III-46-A 2 multiplied by Swap LIBOR, subject to a maximum rate of
REMIC I Remittance Rate
I-1-A through I-41-A REMIC I Remittance Rate
II-1-A through II-41-A REMIC I Remittance Rate
III-1-A through III-41-A REMIC I Remittance Rate
43 I-43-A through I-46-A 2 multiplied by Swap LIBOR, subject to a maximum rate of
REMIC I Remittance Rate
II-43-A through II-46-A 2 multiplied by Swap LIBOR, subject to a maximum rate of
REMIC I Remittance Rate
III-43-A through III-46-A 2 multiplied by Swap LIBOR, subject to a maximum rate of
REMIC I Remittance Rate
I-1-A through I-42-A REMIC I Remittance Rate
II-1-A through II-42-A REMIC I Remittance Rate
III-1-A through III-42-A REMIC I Remittance Rate
44 I-44-A through I-46-A 2 multiplied by Swap LIBOR, subject to a maximum rate of
REMIC I Remittance Rate
II-44-A through II-46-A 2 multiplied by Swap LIBOR, subject to a maximum rate of
REMIC I Remittance Rate
III-44-A through III-46-A 2 multiplied by Swap LIBOR, subject to a maximum rate of
REMIC I Remittance Rate
I-1-A through I-43-A REMIC I Remittance Rate
II-1-A through II-43-A REMIC I Remittance Rate
III-1-A through III-43-A REMIC I Remittance Rate
45 I-45-A through I-46-A 2 multiplied by Swap LIBOR, subject to a maximum rate of
REMIC I Remittance Rate
II-45-A through II-46-A 2 multiplied by Swap LIBOR, subject to a maximum rate of
REMIC I Remittance Rate
III-45-A through III-46-A 2 multiplied by Swap LIBOR, subject to a maximum rate of
REMIC I Remittance Rate
I-1-A through I-44-A REMIC I Remittance Rate
II-1-A through II-44-A REMIC I Remittance Rate
III-1-A through III-44-A REMIC I Remittance Rate
46 I-46-A 2 multiplied by Swap LIBOR, subject to a maximum rate of
REMIC I Remittance Rate
II-46-A 2 multiplied by Swap LIBOR, subject to a maximum rate of
REMIC I Remittance Rate
III-46-A 2 multiplied by Swap LIBOR, subject to a maximum rate of
REMIC I Remittance Rate
I-1-A through I-45-A REMIC I Remittance Rate
II-1-A through II-45-A REMIC I Remittance Rate
III-1-A through III-45-A REMIC I Remittance Rate
thereafter I-1-A through I-46-A REMIC I Remittance Rate
II-1-A through II-46-A REMIC I Remittance Rate
III-1-A through III-46-A REMIC I Remittance Rate
With respect to REMIC II Regular Interest IA-GRP, a per annum rate (but
not less than zero) equal to the weighted average of: (w) with respect to REMIC
I Regular Interest A-I, the REMIC I Remittance Rate for such REMIC 1 Regular
Interest for each such Distribution Date, (x) with respect to REMIC I Group IA
Regular Interests ending with the designation "B", the weighted average of the
REMIC I Remittance Rates for such REMIC I Regular Interests, weighted on the
basis of the Uncertificated Balances of each such REMIC I Regular Interest for
each such Distribution Date and (y) with respect to REMIC I Group IA Regular
Interests ending with the designation "A", for each Distribution Date listed
below, the weighted average of the rates listed below for such REMIC I Regular
Interests listed below, weighted on the basis of the Uncertificated Balances of
each such REMIC I Regular Interest for each such Distribution Date:
DISTRIBUTION
DATE REMIC I REGULAR INTEREST RATE
------------- ------------------------ --------------------------------------------------------
1 I-1-A through I-46-A 2 multiplied by Swap LIBOR, subject to a maximum rate of
REMIC I Remittance Rate
2 I-2-A through I-46-A 2 multiplied by Swap LIBOR, subject to a maximum rate of
REMIC I Remittance Rate
I-1-A REMIC I Remittance Rate
3 I-3-A through I-46-A 2 multiplied by Swap LIBOR, subject to a maximum rate of
REMIC I Remittance Rate
I-1-A and I-2-A REMIC I Remittance Rate
4 I-4-A through I-46-A 2 multiplied by Swap LIBOR, subject to a maximum rate of
REMIC I Remittance Rate
I-1-A through I-3-A REMIC I Remittance Rate
5 I-5-A through I-46-A 2 multiplied by Swap LIBOR, subject to a maximum rate of
REMIC I Remittance Rate
I-1-A through I-4-A REMIC I Remittance Rate
6 I-6-A through I-46-A 2 multiplied by Swap LIBOR, subject to a maximum rate of
REMIC I Remittance Rate
I-1-A through I-5-A REMIC I Remittance Rate
7 I-7-A through I-46-A 2 multiplied by Swap LIBOR, subject to a maximum rate of
REMIC I Remittance Rate
I-1-A through I-6-A REMIC I Remittance Rate
8 I-8-A through I-46-A 2 multiplied by Swap LIBOR, subject to a maximum rate of
REMIC I Remittance Rate
I-1-A through I-7-A REMIC I Remittance Rate
9 I-9-A through I-46-A 2 multiplied by Swap LIBOR, subject to a maximum rate of
REMIC I Remittance Rate
I-1-A through I-8-A REMIC I Remittance Rate
10 I-10-A through I-46-A 2 multiplied by Swap LIBOR, subject to a maximum rate of
REMIC I Remittance Rate
I-1-A through I-9-A REMIC I Remittance Rate
11 I-11-A through I-46-A 2 multiplied by Swap LIBOR, subject to a maximum rate of
REMIC I Remittance Rate
I-1-A through I-10-A REMIC I Remittance Rate
12 I-12-A through I-46-A 2 multiplied by Swap LIBOR, subject to a maximum rate of
REMIC I Remittance Rate
I-1-A through I-11-A REMIC I Remittance Rate
13 I-13-A through I-46-A 2 multiplied by Swap LIBOR, subject to a maximum rate of
REMIC I Remittance Rate
I-1-A through I-12-A REMIC I Remittance Rate
14 I-14-A through I-46-A 2 multiplied by Swap LIBOR, subject to a maximum rate of
REMIC I Remittance Rate
I-1-A through I-13-A REMIC I Remittance Rate
15 I-15-A through I-46-A 2 multiplied by Swap LIBOR, subject to a maximum rate of
REMIC I Remittance Rate
I-1-A through I-14-A REMIC I Remittance Rate
16 I-16-A through I-46-A 2 multiplied by Swap LIBOR, subject to a maximum rate of
REMIC I Remittance Rate
I-1-A through I-15-A REMIC I Remittance Rate
17 I-17-A through I-46-A 2 multiplied by Swap LIBOR, subject to a maximum rate of
REMIC I Remittance Rate
I-1-A through I-16-A REMIC I Remittance Rate
18 I-18-A through I-46-A 2 multiplied by Swap LIBOR, subject to a maximum rate of
REMIC I Remittance Rate
I-1-A through I-17-A REMIC I Remittance Rate
19 I-19-A through I-46-A 2 multiplied by Swap LIBOR, subject to a maximum rate of
REMIC I Remittance Rate
I-1-A through I-18-A REMIC I Remittance Rate
20 I-20-A through I-46-A 2 multiplied by Swap LIBOR, subject to a maximum rate of
REMIC I Remittance Rate
I-1-A through I-19-A REMIC I Remittance Rate
21 I-21-A through I-46-A 2 multiplied by Swap LIBOR, subject to a maximum rate of
REMIC I Remittance Rate
I-1-A through I-20-A REMIC I Remittance Rate
22 I-22-A through I-46-A 2 multiplied by Swap LIBOR, subject to a maximum rate of
REMIC I Remittance Rate
I-1-A through I-21-A REMIC I Remittance Rate
23 I-23-A through I-46-A 2 multiplied by Swap LIBOR, subject to a maximum rate of
REMIC I Remittance Rate
I-1-A through I-22-A REMIC I Remittance Rate
24 I-24-A through I-46-A 2 multiplied by Swap LIBOR, subject to a maximum rate of
REMIC I Remittance Rate
I-1-A through I-23-A REMIC I Remittance Rate
25 I-25-A through I-46-A 2 multiplied by Swap LIBOR, subject to a maximum rate of
REMIC I Remittance Rate
I-1-A through I-24-A REMIC I Remittance Rate
26 I-26-A through I-46-A 2 multiplied by Swap LIBOR, subject to a maximum rate of
REMIC I Remittance Rate
I-1-A through I-25-A REMIC I Remittance Rate
27 I-27-A through I-46-A 2 multiplied by Swap LIBOR, subject to a maximum rate of
REMIC I Remittance Rate
I-1-A through I-26-A REMIC I Remittance Rate
28 I-28-A through I-46-A 2 multiplied by Swap LIBOR, subject to a maximum rate of
REMIC I Remittance Rate
I-1-A through I-27-A REMIC I Remittance Rate
29 I-29-A through I-46-A 2 multiplied by Swap LIBOR, subject to a maximum rate of
REMIC I Remittance Rate
I-1-A through I-28-A REMIC I Remittance Rate
30 I-30-A through I-46-A 2 multiplied by Swap LIBOR, subject to a maximum rate of
REMIC I Remittance Rate
I-1-A through I-29-A REMIC I Remittance Rate
31 I-31-A through I-46-A 2 multiplied by Swap LIBOR, subject to a maximum rate of
REMIC I Remittance Rate
I-1-A through I-30-A REMIC I Remittance Rate
32 I-32-A through I-46-A 2 multiplied by Swap LIBOR, subject to a maximum rate of
REMIC I Remittance Rate
I-1-A through I-31-A REMIC I Remittance Rate
33 I-33-A through I-46-A 2 multiplied by Swap LIBOR, subject to a maximum rate of
REMIC I Remittance Rate
I-1-A through I-32-A REMIC I Remittance Rate
34 I-34-A through I-46-A 2 multiplied by Swap LIBOR, subject to a maximum rate of
REMIC I Remittance Rate
I-1-A through I-33-A REMIC I Remittance Rate
35 I-35-A through I-46-A 2 multiplied by Swap LIBOR, subject to a maximum rate of
REMIC I Remittance Rate
I-1-A through I-34-A REMIC I Remittance Rate
36 I-36-A through I-46-A 2 multiplied by Swap LIBOR, subject to a maximum rate of
REMIC I Remittance Rate
I-1-A through I-35-A REMIC I Remittance Rate
37 I-37-A through I-46-A 2 multiplied by Swap LIBOR, subject to a maximum rate of
REMIC I Remittance Rate
I-1-A through I-36-A REMIC I Remittance Rate
38 I-38-A through I-46-A 2 multiplied by Swap LIBOR, subject to a maximum rate of
REMIC I Remittance Rate
I-1-A through I-37-A REMIC I Remittance Rate
39 I-39-A through I-46-A 2 multiplied by Swap LIBOR, subject to a maximum rate of
REMIC I Remittance Rate
I-1-A through I-38-A REMIC I Remittance Rate
40 I-40-A through I-46-A 2 multiplied by Swap LIBOR, subject to a maximum rate of
REMIC I Remittance Rate
I-1-A through I-39-A REMIC I Remittance Rate
41 I-41-A through I-46-A 2 multiplied by Swap LIBOR, subject to a maximum rate of
REMIC I Remittance Rate
I-1-A through I-40-A REMIC I Remittance Rate
42 I-42-A through I-46-A 2 multiplied by Swap LIBOR, subject to a maximum rate of
REMIC I Remittance Rate
I-1-A through I-41-A REMIC I Remittance Rate
43 I-43-A through I-46-A 2 multiplied by Swap LIBOR, subject to a maximum rate of
REMIC I Remittance Rate
I-1-A through I-42-A REMIC I Remittance Rate
44 I-44-A through I-46-A 2 multiplied by Swap LIBOR, subject to a maximum rate of
REMIC I Remittance Rate
I-1-A through I-43-A REMIC I Remittance Rate
45 I-45-A through I-46-A 2 multiplied by Swap LIBOR, subject to a maximum rate of
REMIC I Remittance Rate
I-1-A through I-44-A REMIC I Remittance Rate
46 I-46-A 2 multiplied by Swap LIBOR, subject to a maximum rate of
REMIC I Remittance Rate
I-1-A through I-45-A REMIC I Remittance Rate
thereafter I-1-A through I-46-A REMIC I Remittance Rate
With respect to REMIC II Regular Interest IB-GRP, a per annum rate (but
not less than zero) equal to the weighted average of: (w) with respect to REMIC
I Regular Interest A-II, the REMIC I Remittance Rate for such REMIC 1 Regular
Interest for each such Distribution Date, (x) with respect to REMIC I Group IB
Regular Interests ending with the designation "B", the weighted average of the
REMIC I Remittance Rates for such REMIC I Regular Interests, weighted on the
basis of the Uncertificated Balances of each such REMIC I Regular Interest for
each such Distribution Date and (y) with respect to REMIC I Group IB Regular
Interests ending with the designation "A", for each Distribution Date listed
below, the weighted average of the rates listed below for such REMIC I Regular
Interests listed below, weighted on the basis of the Uncertificated Balances of
each such REMIC I Regular Interest for each such Distribution Date:
DISTRIBUTION
DATE REMIC I REGULAR INTEREST RATE
------------ ------------------------ --------------------------------------------------------
1 II-1-A through II-46-A 2 multiplied by Swap LIBOR, subject to a maximum rate of
REMIC I Remittance Rate
2 II-2-A through II-46-A 2 multiplied by Swap LIBOR, subject to a maximum rate of
REMIC I Remittance Rate
II-1-A REMIC I Remittance Rate
3 II-3-A through II-46-A 2 multiplied by Swap LIBOR, subject to a maximum rate of
REMIC I Remittance Rate
II-1-A and II-2-A REMIC I Remittance Rate
4 II-4-A through II-46-A 2 multiplied by Swap LIBOR, subject to a maximum rate of
REMIC I Remittance Rate
II-1-A through II-3-A REMIC I Remittance Rate
5 II-5-A through II-46-A 2 multiplied by Swap LIBOR, subject to a maximum rate of
REMIC I Remittance Rate
II-1-A through II-4-A REMIC I Remittance Rate
6 II-6-A through II-46-A 2 multiplied by Swap LIBOR, subject to a maximum rate of
REMIC I Remittance Rate
II-1-A through II-5-A REMIC I Remittance Rate
7 II-7-A through II-46-A 2 multiplied by Swap LIBOR, subject to a maximum rate of
REMIC I Remittance Rate
II-1-A through II-6-A REMIC I Remittance Rate
8 II-8-A through II-46-A 2 multiplied by Swap LIBOR, subject to a maximum rate of
REMIC I Remittance Rate
II-1-A through II-7-A REMIC I Remittance Rate
9 II-9-A through II-46-A 2 multiplied by Swap LIBOR, subject to a maximum rate of
REMIC I Remittance Rate
II-1-A through II-8-A REMIC I Remittance Rate
10 II-10-A through II-46-A 2 multiplied by Swap LIBOR, subject to a maximum rate of
REMIC I Remittance Rate
II-1-A through II-9-A REMIC I Remittance Rate
11 II-11-A through II-46-A 2 multiplied by Swap LIBOR, subject to a maximum rate of
REMIC I Remittance Rate
II-1-A through II-10-A REMIC I Remittance Rate
12 II-12-A through II-46-A 2 multiplied by Swap LIBOR, subject to a maximum rate of
REMIC I Remittance Rate
II-1-A through II-11-A REMIC I Remittance Rate
13 II-13-A through II-46-A 2 multiplied by Swap LIBOR, subject to a maximum rate of
REMIC I Remittance Rate
II-1-A through II-12-A REMIC I Remittance Rate
14 II-14-A through II-46-A 2 multiplied by Swap LIBOR, subject to a maximum rate of
REMIC I Remittance Rate
II-1-A through II-13-A REMIC I Remittance Rate
15 II-15-A through II-46-A 2 multiplied by Swap LIBOR, subject to a maximum rate of
REMIC I Remittance Rate
II-1-A through II-14-A REMIC I Remittance Rate
16 II-16-A through II-46-A 2 multiplied by Swap LIBOR, subject to a maximum rate of
REMIC I Remittance Rate
II-1-A through II-15-A REMIC I Remittance Rate
17 II-17-A through II-46-A 2 multiplied by Swap LIBOR, subject to a maximum rate of
REMIC I Remittance Rate
II-1-A through II-16-A REMIC I Remittance Rate
18 II-18-A through II-46-A 2 multiplied by Swap LIBOR, subject to a maximum rate of
REMIC I Remittance Rate
II-1-A through II-17-A REMIC I Remittance Rate
19 II-19-A through II-46-A 2 multiplied by Swap LIBOR, subject to a maximum rate of
REMIC I Remittance Rate
II-1-A through II-18-A REMIC I Remittance Rate
20 II-20-A through II-46-A 2 multiplied by Swap LIBOR, subject to a maximum rate of
REMIC I Remittance Rate
II-1-A through II-19-A REMIC I Remittance Rate
21 II-21-A through II-46-A 2 multiplied by Swap LIBOR, subject to a maximum rate of
REMIC I Remittance Rate
II-1-A through II-20-A REMIC I Remittance Rate
22 II-22-A through II-46-A 2 multiplied by Swap LIBOR, subject to a maximum rate of
REMIC I Remittance Rate
II-1-A through II-21-A REMIC I Remittance Rate
23 II-23-A through II-46-A 2 multiplied by Swap LIBOR, subject to a maximum rate of
REMIC I Remittance Rate
II-1-A through II-22-A REMIC I Remittance Rate
24 II-24-A through II-46-A 2 multiplied by Swap LIBOR, subject to a maximum rate of
REMIC I Remittance Rate
II-1-A through II-23-A REMIC I Remittance Rate
25 II-25-A through II-46-A 2 multiplied by Swap LIBOR, subject to a maximum rate of
REMIC I Remittance Rate
II-1-A through II-24-A REMIC I Remittance Rate
26 II-26-A through II-46-A 2 multiplied by Swap LIBOR, subject to a maximum rate of
REMIC I Remittance Rate
II-1-A through II-25-A REMIC I Remittance Rate
27 II-27-A through II-46-A 2 multiplied by Swap LIBOR, subject to a maximum rate of
REMIC I Remittance Rate
II-1-A through II-26-A REMIC I Remittance Rate
28 II-28-A through II-46-A 2 multiplied by Swap LIBOR, subject to a maximum rate of
REMIC I Remittance Rate
II-1-A through II-27-A REMIC I Remittance Rate
29 II-29-A through II-46-A 2 multiplied by Swap LIBOR, subject to a maximum rate of
REMIC I Remittance Rate
II-1-A through II-28-A REMIC I Remittance Rate
30 II-30-A through II-46-A 2 multiplied by Swap LIBOR, subject to a maximum rate of
REMIC I Remittance Rate
II-1-A through II-29-A REMIC I Remittance Rate
31 II-31-A through II-46-A 2 multiplied by Swap LIBOR, subject to a maximum rate of
REMIC I Remittance Rate
II-1-A through II-30-A REMIC I Remittance Rate
32 II-32-A through II-46-A 2 multiplied by Swap LIBOR, subject to a maximum rate of
REMIC I Remittance Rate
II-1-A through II-31-A REMIC I Remittance Rate
33 II-33-A through II-46-A 2 multiplied by Swap LIBOR, subject to a maximum rate of
REMIC I Remittance Rate
II-1-A through II-32-A REMIC I Remittance Rate
34 II-34-A through II-46-A 2 multiplied by Swap LIBOR, subject to a maximum rate of
REMIC I Remittance Rate
II-1-A through II-33-A REMIC I Remittance Rate
35 II-35-A through II-46-A 2 multiplied by Swap LIBOR, subject to a maximum rate of
REMIC I Remittance Rate
II-1-A through II-34-A REMIC I Remittance Rate
36 II-36-A through II-46-A 2 multiplied by Swap LIBOR, subject to a maximum rate of
REMIC I Remittance Rate
II-1-A through II-35-A REMIC I Remittance Rate
37 II-37-A through II-46-A 2 multiplied by Swap LIBOR, subject to a maximum rate of
REMIC I Remittance Rate
II-1-A through II-36-A REMIC I Remittance Rate
38 II-38-A through II-46-A 2 multiplied by Swap LIBOR, subject to a maximum rate of
REMIC I Remittance Rate
II-1-A through II-37-A REMIC I Remittance Rate
39 II-39-A through II-46-A 2 multiplied by Swap LIBOR, subject to a maximum rate of
REMIC I Remittance Rate
II-1-A through II-38-A REMIC I Remittance Rate
40 II-40-A through II-46-A 2 multiplied by Swap LIBOR, subject to a maximum rate of
REMIC I Remittance Rate
II-1-A through II-39-A REMIC I Remittance Rate
41 II-41-A through II-46-A 2 multiplied by Swap LIBOR, subject to a maximum rate of
REMIC I Remittance Rate
II-1-A through II-40-A REMIC I Remittance Rate
42 II-42-A through II-46-A 2 multiplied by Swap LIBOR, subject to a maximum rate of
REMIC I Remittance Rate
II-1-A through II-41-A REMIC I Remittance Rate
43 II-43-A through II-46-A 2 multiplied by Swap LIBOR, subject to a maximum rate of
REMIC I Remittance Rate
II-1-A through II-42-A REMIC I Remittance Rate
44 II-44-A through II-46-A 2 multiplied by Swap LIBOR, subject to a maximum rate of
REMIC I Remittance Rate
II-1-A through II-43-A REMIC I Remittance Rate
45 II-45-A through II-46-A 2 multiplied by Swap LIBOR, subject to a maximum rate of
REMIC I Remittance Rate
II-1-A through II-44-A REMIC I Remittance Rate
46 II-46 2 multiplied by Swap LIBOR, subject to a maximum rate of
REMIC I Remittance Rate
II-1-A through II-45-A REMIC I Remittance Rate
thereafter II-1-A through II-46-A REMIC I Remittance Rate
With respect to REMIC II Regular Interest II-GRP, a per annum rate (but
not less than zero) equal to the weighted average of: (w) with respect to REMIC
I Regular Interest A-II, the REMIC I Remittance Rate for such REMIC 1 Regular
Interest for each such Distribution Date, (x) with respect to REMIC I Group II
Regular Interests ending with the designation "B", the weighted average of the
REMIC I Remittance Rates for such REMIC I Regular Interests, weighted on the
basis of the Uncertificated Balances of each such REMIC I Regular Interest for
each such Distribution Date and (y) with respect to REMIC I Group II Regular
Interests ending with the designation "A", for each Distribution Date listed
below, the weighted average of the rates listed below for such REMIC I Regular
Interests listed below, weighted on the basis of the Uncertificated Balances of
each such REMIC I Regular Interest for each such Distribution Date:
DISTRIBUTION
DATE REMIC I REGULAR INTEREST RATE
------------ ------------------------ --------------------------------------------------------
1 III-1-A through III-46-A 2 multiplied by Swap LIBOR, subject to a maximum rate of
REMIC I Remittance Rate
2 III-2-A through III-46-A 2 multiplied by Swap LIBOR, subject to a maximum rate of
REMIC I Remittance Rate
III-1-A REMIC I Remittance Rate
3 III-3-A through III-46-A 2 multiplied by Swap LIBOR, subject to a maximum rate of
REMIC I Remittance Rate
III-1-A and III-2-A REMIC I Remittance Rate
4 III-4-A through III-46-A 2 multiplied by Swap LIBOR, subject to a maximum rate of
REMIC I Remittance Rate
III-1-A through III-3-A REMIC I Remittance Rate
5 III-5-A through III-46-A 2 multiplied by Swap LIBOR, subject to a maximum rate of
REMIC I Remittance Rate
III-1-A through III-4-A REMIC I Remittance Rate
6 III-6-A through III-46-A 2 multiplied by Swap LIBOR, subject to a maximum rate of
REMIC I Remittance Rate
III-1-A through III-5-A REMIC I Remittance Rate
7 III-7-A through III-46-A 2 multiplied by Swap LIBOR, subject to a maximum rate of
REMIC I Remittance Rate
III-1-A through III-6-A REMIC I Remittance Rate
8 III-8-A through III-46-A 2 multiplied by Swap LIBOR, subject to a maximum rate of
REMIC I Remittance Rate
III-1-A through III-7-A REMIC I Remittance Rate
9 III-9-A through III-46-A 2 multiplied by Swap LIBOR, subject to a maximum rate of
REMIC I Remittance Rate
III-1-A through III-8-A REMIC I Remittance Rate
10 III-10-A through III-46-A 2 multiplied by Swap LIBOR, subject to a maximum rate of
REMIC I Remittance Rate
III-1-A through III-9-A REMIC I Remittance Rate
11 III-11-A through III-46-A 2 multiplied by Swap LIBOR, subject to a maximum rate of
REMIC I Remittance Rate
III-1-A through III-10-A REMIC I Remittance Rate
12 III-12-A through III-46-A 2 multiplied by Swap LIBOR, subject to a maximum rate of
REMIC I Remittance Rate
III-1-A through III-11-A REMIC I Remittance Rate
13 III-13-A through III-46-A 2 multiplied by Swap LIBOR, subject to a maximum rate of
REMIC I Remittance Rate
III-1-A through III-12-A REMIC I Remittance Rate
14 III-14-A through III-46-A 2 multiplied by Swap LIBOR, subject to a maximum rate of
REMIC I Remittance Rate
III-1-A through III-13-A REMIC I Remittance Rate
15 III-15-A through III-46-A 2 multiplied by Swap LIBOR, subject to a maximum rate of
REMIC I Remittance Rate
III-1-A through III-14-A REMIC I Remittance Rate
16 III-16-A through III-46-A 2 multiplied by Swap LIBOR, subject to a maximum rate of
REMIC I Remittance Rate
III-1-A through III-15-A REMIC I Remittance Rate
17 III-17-A through III-46-A 2 multiplied by Swap LIBOR, subject to a maximum rate of
REMIC I Remittance Rate
III-1-A through III-16-A REMIC I Remittance Rate
18 III-18-A through III-46-A 2 multiplied by Swap LIBOR, subject to a maximum rate of
REMIC I Remittance Rate
III-1-A through III-17-A REMIC I Remittance Rate
19 III-19-A through III-46-A 2 multiplied by Swap LIBOR, subject to a maximum rate of
REMIC I Remittance Rate
III-1-A through III-18-A REMIC I Remittance Rate
20 III-20-A through III-46-A 2 multiplied by Swap LIBOR, subject to a maximum rate of
REMIC I Remittance Rate
III-1-A through III-19-A REMIC I Remittance Rate
21 III-21-A through III-46-A 2 multiplied by Swap LIBOR, subject to a maximum rate of
REMIC I Remittance Rate
III-1-A through III-20-A REMIC I Remittance Rate
22 III-22-A through III-46-A 2 multiplied by Swap LIBOR, subject to a maximum rate of
REMIC I Remittance Rate
III-1-A through III-21-A REMIC I Remittance Rate
23 III-23-A through III-46-A 2 multiplied by Swap LIBOR, subject to a maximum rate of
REMIC I Remittance Rate
III-1-A through III-22-A REMIC I Remittance Rate
24 III-24-A through III-46-A 2 multiplied by Swap LIBOR, subject to a maximum rate of
REMIC I Remittance Rate
III-1-A through III-23-A REMIC I Remittance Rate
25 III-25-A through III-46-A 2 multiplied by Swap LIBOR, subject to a maximum rate of
REMIC I Remittance Rate
III-1-A through III-24-A REMIC I Remittance Rate
26 III-26-A through III-46-A 2 multiplied by Swap LIBOR, subject to a maximum rate of
REMIC I Remittance Rate
III-1-A through III-25-A REMIC I Remittance Rate
27 III-27-A through III-46-A 2 multiplied by Swap LIBOR, subject to a maximum rate of
REMIC I Remittance Rate
III-1-A through III-26-A REMIC I Remittance Rate
28 III-28-A through III-46-A 2 multiplied by Swap LIBOR, subject to a maximum rate of
REMIC I Remittance Rate
III-1-A through III-27-A REMIC I Remittance Rate
29 III-29-A through III-46-A 2 multiplied by Swap LIBOR, subject to a maximum rate of
REMIC I Remittance Rate
III-1-A through III-28-A REMIC I Remittance Rate
30 III-30-A through III-46-A 2 multiplied by Swap LIBOR, subject to a maximum rate of
REMIC I Remittance Rate
III-1-A through III-29-A REMIC I Remittance Rate
31 III-31-A through III-46-A 2 multiplied by Swap LIBOR, subject to a maximum rate of
REMIC I Remittance Rate
III-1-A through III-30-A REMIC I Remittance Rate
32 III-32-A through III-46-A 2 multiplied by Swap LIBOR, subject to a maximum rate of
REMIC I Remittance Rate
III-1-A through III-31-A REMIC I Remittance Rate
33 III-33-A through III-46-A 2 multiplied by Swap LIBOR, subject to a maximum rate of
REMIC I Remittance Rate
III-1-A through III-32-A REMIC I Remittance Rate
34 III-34-A through III-46-A 2 multiplied by Swap LIBOR, subject to a maximum rate of
REMIC I Remittance Rate
III-1-A through III-33-A REMIC I Remittance Rate
35 III-35-A through III-46-A 2 multiplied by Swap LIBOR, subject to a maximum rate of
REMIC I Remittance Rate
III-1-A through III-34-A REMIC I Remittance Rate
36 III-36-A through III-46-A 2 multiplied by Swap LIBOR, subject to a maximum rate of
REMIC I Remittance Rate
III-1-A through III-35-A REMIC I Remittance Rate
37 III-37-A through III-46-A 2 multiplied by Swap LIBOR, subject to a maximum rate of
REMIC I Remittance Rate
III-1-A through III-36-A REMIC I Remittance Rate
38 III-38-A through III-46-A 2 multiplied by Swap LIBOR, subject to a maximum rate of
REMIC I Remittance Rate
III-1-A through III-37-A REMIC I Remittance Rate
39 III-39-A through III-46-A 2 multiplied by Swap LIBOR, subject to a maximum rate of
REMIC I Remittance Rate
III-1-A through III-38-A REMIC I Remittance Rate
40 III-40-A through III-46-A 2 multiplied by Swap LIBOR, subject to a maximum rate of
REMIC I Remittance Rate
III-1-A through III-39-A REMIC I Remittance Rate
41 III-41-A through III-46-A 2 multiplied by Swap LIBOR, subject to a maximum rate of
REMIC I Remittance Rate
III-1-A through III-40-A REMIC I Remittance Rate
42 III-42-A through III-46-A 2 multiplied by Swap LIBOR, subject to a maximum rate of
REMIC I Remittance Rate
III-1-A through III-41-A REMIC I Remittance Rate
43 III-43-A through III-46-A 2 multiplied by Swap LIBOR, subject to a maximum rate of
REMIC I Remittance Rate
III-1-A through III-42-A REMIC I Remittance Rate
44 III-44-A through III-46-A 2 multiplied by Swap LIBOR, subject to a maximum rate of
REMIC I Remittance Rate
III-1-A through III-43-A REMIC I Remittance Rate
45 III-45-A through III-46-A 2 multiplied by Swap LIBOR, subject to a maximum rate of
REMIC I Remittance Rate
III-1-A through III-44-A REMIC I Remittance Rate
46 III-46 2 multiplied by Swap LIBOR, subject to a maximum rate of
REMIC I Remittance Rate
III-1-A through III-45-A REMIC I Remittance Rate
thereafter III-1-A through III-46-A REMIC I Remittance Rate
With respect to REMIC II Regular Interest IO, and (i) the first
Distribution Date through the 46th Distribution Date, the excess of (x) the
weighted average of the REMIC I Remittance Rates for REMIC I Regular Interests
including the designation "A", over (y) 2 multiplied by Swap LIBOR. and (ii)
thereafter, 0.00%. With respect to REMIC II Regular Interest P, 0.00%.
"REMIC II Sub WAC Allocation Percentage": 50% of any amount payable or
loss attributable from the Mortgage Loans, which shall be allocated to REMIC II
Regular Interest IA-SUB, REMIC II Regular Interest IA-GRP, REMIC II Regular
Interest IB-SUB, REMIC II Regular Interest IB-GRP, REMIC II Regular Interest
II-SUB, REMIC II Regular Interest II-GRP and REMIC II Regular Interest XX.
"REMIC II Subordinated Balance Ratio": The ratio among the
Uncertificated Balances of each REMIC II Regular Interest ending with the
designation "SUB,", equal to the ratio between, with respect to each such REMIC
II Regular Interest, the excess of (x) the aggregate Stated Principal Balance of
the Group IA Mortgage Loans, Group IB Mortgage Loans or Group II Mortgage Loans,
as applicable over (y) the current Certificate Principal Balance of related
Class A Certificates.
"REMIC II Required Overcollateralization Amount": 0.50% of the Required
Overcollateralization Amount.
"REMIC III": The segregated pool of assets consisting of all of the
REMIC II Regular Interests conveyed in trust to the Trustee, for the benefit of
the REMIC III Certificateholders pursuant to Section 2.07, and all amounts
deposited therein, with respect to which a separate REMIC election is to be
made.
"REMIC III Certificate": Any Regular Certificate or Class R
Certificate.
"REMIC III Certificateholder": The Holder of any REMIC III Certificate.
"REMIC Provisions": Provisions of the federal income tax law relating
to real estate mortgage investment conduits, which appear at Section 860A
through 860G of the Code, and related provisions, and proposed, temporary and
final regulations and published rulings, notices and announcements promulgated
thereunder, as the foregoing may be in effect from time to time.
"REMIC Regular Interest": Any REMIC I Regular Interest or REMIC II
Regular Interest.
"REMIC Remittance Rate": The REMIC I Remittance Rate or the REMIC II
Remittance Rate.
"Remittance Report": A report by ▇▇▇▇▇ Fargo pursuant to Section
5.03(a) of this Agreement or by Countrywide pursuant to the Servicing Agreement.
"Rents from Real Property": With respect to any REO Property, gross
income of the character described in Section 856(d) of the Code as being
included in the term "rents from real property."
"REO Account": The account or accounts maintained, or caused to be
maintained, by ▇▇▇▇▇ Fargo in respect of an REO Property pursuant to Section
3.21 of this Agreement or by Countrywide pursuant to the Servicing Agreement.
"REO Disposition": The sale or other disposition of an REO Property on
behalf of REMIC I.
"REO Imputed Interest": As to any REO Property, for any calendar month
during which such REO Property was at any time part of REMIC I, one month's
interest at the applicable Net Mortgage Rate on the Stated Principal Balance of
such REO Property (or, in the case of the first such calendar month, of the
related Mortgage Loan, if appropriate) as of the close of business on the
Distribution Date in such calendar month.
"REO Principal Amortization": With respect to any REO Property, for any
calendar month, the excess, if any, of (a) the aggregate of all amounts received
in respect of such REO Property during such calendar month, whether in the form
of rental income, sale proceeds (including, without limitation, that portion of
the Termination Price paid in connection with a purchase of all of the Mortgage
Loans and REO Properties pursuant to Section 10.01 of this Agreement that is
allocable to such REO Property) or otherwise, net of any portion of such amounts
(i) payable in respect of the proper operation, management and maintenance of
such REO Property or (ii) payable or reimbursable to ▇▇▇▇▇ Fargo pursuant to
Section 3.21(d) of this Agreement or Countrywide pursuant to the Servicing
Agreement for unpaid Servicing Fees in respect of the related Mortgage Loan and
unreimbursed Servicing Advances and P&I Advances in respect of such REO Property
or the related Mortgage Loan, over (b) the REO Imputed Interest in respect of
such REO Property for such calendar month.
"REO Property": A Mortgaged Property acquired by ▇▇▇▇▇ Fargo or its
nominee on behalf of REMIC I through foreclosure or deed-in-lieu of foreclosure,
as described in Section 3.21 of this Agreement, or by Countrywide pursuant to
the Servicing Agreement.
"Required Overcollateralization Amount": With respect to any
Distribution Date (i) prior to the Stepdown Date, the product of (A) 3.35% and
(B) the aggregate principal balance of the Mortgage Loans as of the Cut-off
Date, (ii) on or after the Stepdown Date provided a Trigger Event is not in
effect, the greater of (x) 6.70% of the aggregate Stated Principal Balance of
the Mortgage Loans as of the last day of the related Due Period and (y) an
amount equal to the product of (A) 0.50% and (B) the aggregate principal balance
of the Mortgage Loans as of the Cut-off Date, and (iii) on or after the Stepdown
Date and a Trigger Event is in effect, the Required Overcollateralization Amount
for the immediately preceding Distribution Date. Notwithstanding the foregoing,
on and after any Distribution Date following the reduction of the aggregate
Certificate Principal Balance of the Class A Certificates and Mezzanine
Certificates to zero, the Required Overcollateralization Amount shall be zero.
"Reserve Fund": A fund created pursuant to Section 3.24 which shall be
an asset of the Trust Fund but which shall not be an asset of any Trust REMIC.
"Reserve Interest Rate": With respect to any Interest Determination
Date, the rate per annum that the Securities Administrator determines to be
either (i) the arithmetic mean (rounded upwards if necessary to the nearest
whole multiple of 1/16%) of the one-month U.S. dollar lending rates which New
York City banks selected by the Securities Administrator, after consultation
with the Depositor, are quoting on the relevant Interest Determination Date to
the principal London offices of leading banks in the London interbank market or
(ii) in the event that the Securities Administrator can determine no such
arithmetic mean, the lowest one-month U.S. dollar lending rate which New York
City banks selected by the Securities Administrator are quoting on such Interest
Determination Date to leading European banks.
"Residential Dwelling": Any one of the following: (i) a detached
one-family dwelling, (ii) a detached two- to four-family dwelling, (iii) a
one-family dwelling unit in a ▇▇▇▇▇▇ Mae eligible condominium project, (iv) a
manufactured home, or (v) a detached one-family dwelling in a planned unit
development, none of which is a co-operative or mobile home.
"Residual Certificate": Any one of the Class R Certificates.
"Residual Interest": The sole class of "residual interests" in a REMIC
within the meaning of Section 860G(a)(2) of the Code.
"Responsible Officer": When used with respect to the Trustee, any
officer of the Trustee having direct responsibility for the administration of
this Agreement and, with respect to a particular matter, to whom such matter is
referred because of such officer's knowledge of and familiarity with the
particular subject.
"Rule 144A": As defined in Section 6.01(c).
"S&P": Standard and Poor's, a division of the ▇▇▇▇▇▇-▇▇▇▇ Companies,
Inc.
"Scheduled Principal Balance": With respect to any Mortgage Loan: (a)
as of the Cut-off Date, the outstanding principal balance of such Mortgage Loan
as of such date, net of the principal portion of all unpaid Monthly Payments, if
any, due on or before such date; (b) as of any Due Date subsequent to the
Cut-off Date up to and including the Due Date in the calendar month in which a
Liquidation Event occurs with respect to such Mortgage Loan, the Scheduled
Principal Balance of such Mortgage Loan as of the Cut-off Date, minus the sum of
(i) the principal portion of each Monthly Payment due on or before such Due Date
but subsequent to the Cut-off Date, whether or not received, (ii) all Principal
Prepayments received before such Due Date but after the Cut-off Date, (iii) the
principal portion of all Liquidation Proceeds and Insurance Proceeds received
before such Due Date but after the Cut-off Date, net of any portion thereof that
represents principal due (without regard to any acceleration of payments under
the related Mortgage and Mortgage Note) on a Due Date occurring on or before the
date on which such proceeds were received and (iv) any Realized Loss incurred
with respect thereto as a result of a Deficient Valuation occurring before such
Due Date, but only to the extent such Realized Loss represents a reduction in
the portion of principal of such Mortgage Loan not yet due (without regard to
any acceleration of payments under the related Mortgage and Mortgage Note) as of
the date of such Deficient Valuation; and (c) as of any Due Date subsequent to
the occurrence of a Liquidation Event with respect to such Mortgage Loan, zero.
With respect to any REO Property: (a) as of any Due Date subsequent to the date
of its acquisition on behalf of the Trust Fund up to and including the Due Date
in the calendar month in which a Liquidation Event occurs with respect to such
REO Property, an amount (not less than zero) equal to the Scheduled Principal
Balance of the related Mortgage Loan as of the Due Date in the calendar month in
which such REO Property was acquired, minus the aggregate amount of REO
Principal Amortization, if any, in respect of REO Property for all previously
ended calendar months; and (b) as of any Due Date subsequent to the occurrence
of a Liquidation Event with respect to such REO Property, zero.
"Securities Act": The Securities Act of 1933, as amended.
"Securities Administrator": As of the Closing Date, ▇▇▇▇▇ Fargo Bank,
National Association and thereafter, its respective successors in interest that
meet the qualifications of this Agreement. The Securities Administrator and the
Master Servicer shall at all times be the same Person or Affiliates.
"Seller": DB Structured Products, Inc. or its successor in interest, in
its capacity as seller under the Mortgage Loan Purchase Agreement.
"Senior Interest Distribution Amount": With respect to any Distribution
Date, an amount equal to the sum of (i) the Interest Distribution Amount for
such Distribution Date for the Class A Certificates and (ii) the Interest Carry
Forward Amount, if any, for such Distribution Date for the Class A Certificates.
"Sequential Trigger Event": A Sequential Trigger Event is in effect on
any Distribution Date if, before the 25th Distribution Date, the aggregate
amount of Realized Losses incurred since the Cut-off Date through the last day
of the related Due Period (after giving effect to scheduled payments received or
advanced on or before the related Determination Date and Principal Prepayments
received during the related Prepayment Period) divided by the sum of the
aggregate Stated Principal Balance of the Mortgage Loans as of the Cut-off Date
exceeds 1.40%, or if, on or after the 25th Distribution Date, a Trigger Event is
in effect.
"Servicer": ▇▇▇▇▇ Fargo or Countrywide, or any successor thereto
appointed hereunder or pursuant to the Servicing Agreement, as applicable, in
connection with the servicing and administration of the related Mortgage Loans.
"Servicer Event of Default": One or more of the events described in
Section 8.01(a) of this Agreement.
"Servicer Remittance Date": With respect to any Distribution Date, and
(i) ▇▇▇▇▇ Fargo, the 18th day of the month in which such Distribution Date
occurs; provided that if such 18th day of a given month is not a Business Day,
the Servicer Remittance Date for such month shall be the Business Day
immediately following such 18th day and (ii) Countrywide, as set forth in the
Servicing Agreement.
"Servicer Report": A report (substantially in the form of Schedule 5
hereto) or otherwise in form and substance acceptable to the Master Servicer and
Securities Administrator on an electronic data file or tape prepared by the
related Servicer pursuant to Section 5.03(a) of this Agreement or pursuant to
the Servicing Agreement, as applicable, with such additions, deletions and
modifications as agreed to by the Master Servicer, the Securities Administrator
and the related Servicer.
"Servicing Advances": The customary and reasonable "out-of-pocket"
costs and expenses incurred on or after the Cut-off Date by a Servicer in
connection with a default, delinquency or other unanticipated event by such
Servicer in the performance of its servicing obligations, including, but not
limited to, the cost of (i) the preservation, restoration and protection of a
Mortgaged Property, (ii) any enforcement or judicial proceedings, including but
not limited to foreclosures, in respect of a particular Mortgage Loan, including
any expenses incurred in relation to any such proceedings that result from the
Mortgage Loan being registered on the MERS(R) System, (iii) the management
(including reasonable fees in connection therewith) and liquidation of any REO
Property, (iv) the performance of its obligations under Section 3.01, Section
3.07, Section 3.11, Section 3.13 and Section 3.21 of this Agreement or under the
Servicing Agreement, as applicable, and (v) obtaining any legal documentation
required to be included in the Mortgage File and/or correcting any outstanding
title issues (i.e., any lien or encumbrance on the Mortgaged Property that
prevents the effective enforcement of the intended lien position) reasonably
necessary for the related Servicer to perform its obligations under this
Agreement or under the Servicing Agreement, as applicable. Servicing Advances
also include any reasonable "out-of-pocket" cost and expenses (including legal
fees) incurred by the related Servicer in connection with executing and
recording instruments of satisfaction, deeds of reconveyance or Assignments to
the extent not recovered from the Mortgagor or otherwise payable under this
Agreement or under the Servicing Agreement, as applicable. The Servicers shall
not be required to make any Nonrecoverable Servicing Advances.
"Servicing Agreement": Shall mean the Mortgage Loan Purchase and
Servicing Agreement, dated as of September 1, 2005, between the Seller and
Countrywide (as modified pursuant to the Assignment Agreement).
"Servicing Fee": With respect to each Mortgage Loan and for any
calendar month, an amount equal to one-twelfth of the product of the Servicing
Fee Rate multiplied by the Scheduled Principal Balance of the Mortgage Loans as
of the Due Date in the preceding calendar month. The Servicing Fee is payable
solely from collections of interest on the Mortgage Loans or as otherwise
provided in the Servicing Agreement.
"Servicing Fee Rate": 0.50% per annum.
"Servicing Officer": Any officer of the related Servicer or the Master
Servicer involved in, or responsible for, the administration and servicing of
the related Mortgage Loans, whose name and specimen signature appear on a list
of Servicing Officers furnished by the related Servicer or the Master Servicer
to the Trustee, the Master Servicer (in the case of a Servicer), the Securities
Administrator and the Depositor on the Closing Date, as such list may from time
to time be amended.
"Simple Interest Excess": As of any Determination Date for each Simple
Interest Qualifying Loan, the excess, if any, of (i) the portion of the Monthly
Payment received from the Mortgagor for such Mortgage Loan allocable to interest
with respect to the related Due Period, over (ii) thirty (30) days' interest on
the Scheduled Principal Balance of such Mortgage Loan at the Mortgage Rate.
"Simple Interest Excess Sub-Account": The sub-account of the Collection
Account established by ▇▇▇▇▇ Fargo pursuant to Section 3.08(b). Each Simple
Interest Excess Sub-Account shall be an Eligible Account.
"Simple Interest Mortgage Loan": Any Mortgage Loan for which the
interest due thereon is calculated based on the actual number of days elapsed
between the date on which interest was last paid through the date on which the
most current payment is received and identified as such on the Mortgage Loan
Schedule.
"Simple Interest Qualifying Loan": As of any Determination Date, any
Simple Interest Mortgage Loan that was neither prepaid in full during the
related Due Period, nor delinquent with respect to a payment that became due
during the related Due Period as of the close of business on the Determination
Date following such Due Period.
"Simple Interest Shortfall": As of any Determination Date for each
Simple Interest Qualifying Loan, the excess, if any, of (i) thirty (30) days'
interest on the Scheduled Principal Balance of such Mortgage Loan at the
Mortgage Rate, over (ii) the portion of the Monthly Payment received from the
Mortgagor for such Mortgage Loan allocable to interest with respect to the
related Due Period.
"Single Certificate": With respect to any Class of Certificates (other
than the Residual Certificates), a hypothetical Certificate of such Class
evidencing a Percentage Interest for such Class corresponding to an initial
Certificate Principal Balance of 1,000. With respect to the Residual
Certificates, a hypothetical Certificate of such Class evidencing a 100%
Percentage Interest in such Class.
"Startup Day": With respect to each Trust REMIC, the day designated as
such pursuant to Section 11.01(b) hereof.
"Stated Principal Balance": With respect to any Mortgage Loan: (a) as
of any date of determination up to but not including the Distribution Date on
which the proceeds, if any, of a Liquidation Event with respect to such Mortgage
Loan would be distributed, the Scheduled Principal Balance of such Mortgage Loan
as of the Cut-off Date, as shown in the Mortgage Loan Schedule, minus the sum of
(i) the principal portion of each Monthly Payment due on a Due Date subsequent
to the Cut-off Date, to the extent received from the Mortgagor or advanced by
the related Servicer or a successor to such Servicer (including the Master
Servicer or the Trustee, as applicable) and distributed pursuant to Section 5.01
of this Agreement on or before such date of determination, (ii) all Principal
Prepayments received after the Cut-off Date, to the extent distributed pursuant
to Section 5.01 of this Agreement on or before such date of determination, (iii)
all Liquidation Proceeds and Insurance Proceeds applied by the related Servicer
as recoveries of principal in accordance with the provisions of Section 3.13 of
this Agreement, to the extent distributed pursuant to Section 5.01 of this
Agreement on or before such date of determination, and (iv) any Realized Loss
incurred with respect thereto as a result of a Deficient Valuation made during
or prior to the Prepayment Period for the most recent Distribution Date
coinciding with or preceding such date of determination; and (b) as of any date
of determination coinciding with or subsequent to the Distribution Date on which
the proceeds, if any, of a Liquidation Event with respect to such Mortgage Loan
would be distributed, zero. With respect to any REO Property: (a) as of any date
of determination up to but not including the Distribution Date on which the
proceeds, if any, of a Liquidation Event with respect to such REO Property would
be distributed, an amount (not less than zero) equal to the Stated Principal
Balance of the related Mortgage Loan as of the date on which such REO Property
was acquired on behalf of REMIC I, minus the sum of (i) if such REO Property was
acquired before the Distribution Date in any calendar month, the principal
portion of the Monthly Payment due on the Due Date in the calendar month of
acquisition, to the extent advanced by the related Servicer or a successor to
such Servicer (including the Master Servicer or the Trustee, as applicable) and
distributed pursuant to Section 5.01 of this Agreement, on or before such date
of determination and (ii) the aggregate amount of REO Principal Amortization in
respect of such REO Property for all previously ended calendar months, to the
extent distributed pursuant to Section 4.01 of this Agreement on or before such
date of determination; and (b) as of any date of determination coinciding with
or subsequent to the Distribution Date on which the proceeds, if any, of a
Liquidation Event with respect to such REO Property would be distributed, zero.
"Stepdown Date": The earlier to occur of (i) the later to occur of (x)
the Distribution Date occurring in December 2008 and (y) the first Distribution
Date on which the Credit Enhancement Percentage (calculated for this purpose
only after taking into account distributions of principal on the Mortgage Loans,
but prior to any distribution of the Principal Distribution Amount to the
holders of the Certificates then entitled to distributions of principal on such
Distribution Date), is greater than or equal to approximately 48.30% and (ii)
the first Distribution Date on which the aggregate Certificate Principal Balance
of the Class A Certificates has been reduced to zero.
"Subordinate Certificates": Collectively, the Mezzanine Certificates
and the Class CE Certificates.
"Subsequent Recoveries": As of any Distribution Date, amounts received
during the related Prepayment Period by the related Servicer specifically
related to a defaulted Mortgage Loan or disposition of an REO Property prior to
the related Prepayment Period that resulted in a Realized Loss, after the
liquidation or disposition of such defaulted Mortgage Loan, net of any amounts
reimbursable to the Servicer related to such Mortgage Loan or REO Property.
"Sub-Servicer": Any Person with which a Servicer has entered into a
Sub-Servicing Agreement and which meets the qualifications of a Sub-Servicers
pursuant to Section 3.02 of this Agreement or the Servicing Agreement, as
applicable.
"Sub-Servicing Agreement": The written contract between a Servicer and
a Sub-Servicer relating to servicing and administration of certain Mortgage
Loans as provided in Section 3.02 of this Agreement or the Servicing Agreement,
as applicable.
"Substitution Shortfall Amount": As defined in Section 2.03 of this
Agreement.
"Supplemental Interest Trust": The corpus of a trust created pursuant
to Section 5.07 of this Agreement and designated as the "Supplemental Interest
Trust," consisting of the Swap Agreement, the Class IO Interest and the right to
receive payments in respect of the Class IO Distribution Amount. For the
avoidance of doubt, the Supplemental Interest Trust does not constitute a part
of the Trust Fund.
"Swap Agreement": The Interest Rate Swap Agreement, dated as of
November 28, 2005, between HSBC Bank USA, National Association, as trustee on
behalf of the Supplemental Interest Trust, and the Swap Provider, which
agreement provides for Net Swap Payments and Swap Termination Payments to be
paid, as provided therein, together with any schedules, confirmations or other
agreements relating thereto. The Trustee will provide a copy of the Swap
Agreement to any Certificateholder upon request.
"Swap LIBOR": LIBOR as determined pursuant to the Swap Agreement.
"Swap Notional Amount": For each calculation period as defined in the
Swap Agreement, the amount set forth below:
FROM AND INCLUDING: TO BUT EXCLUDING: SWAP NOTIONAL AMOUNT ():
11/25/2005 12/25/2005 1,797,611,369
12/25/2005 1/25/2006 1,775,039,938
1/25/2006 2/25/2006 1,747,698,848
2/25/2006 3/25/2006 1,715,641,034
3/25/2006 4/25/2006 1,678,956,373
4/25/2006 5/25/2006 1,637,772,868
5/25/2006 6/25/2006 1,592,257,070
6/25/2006 7/25/2006 1,542,614,042
7/25/2006 8/25/2006 1,489,089,365
8/25/2006 9/25/2006 1,431,980,533
9/25/2006 10/25/2006 1,372,372,170
10/25/2006 11/25/2006 1,315,250,718
11/25/2006 12/25/2006 1,260,512,649
12/25/2006 1/25/2007 1,208,058,287
1/25/2007 2/25/2007 1,157,792,135
2/25/2007 3/25/2007 1,109,622,695
3/25/2007 4/25/2007 1,063,462,304
4/25/2007 5/25/2007 1,019,227,076
5/25/2007 6/25/2007 976,836,428
6/25/2007 7/25/2007 936,164,821
7/25/2007 8/25/2007 896,879,689
8/25/2007 9/25/2007 845,987,232
9/25/2007 10/25/2007 717,944,056
10/25/2007 11/25/2007 611,684,651
11/25/2007 12/25/2007 200,304,075
12/25/2007 1/25/2008 186,648,867
1/25/2008 2/25/2008 179,178,338
2/25/2008 3/25/2008 172,018,555
3/25/2008 4/25/2008 165,151,430
4/25/2008 5/25/2008 158,564,699
5/25/2008 6/25/2008 152,246,626
6/25/2008 7/25/2008 146,185,978
7/25/2008 8/25/2008 140,372,011
8/25/2008 9/25/2008 134,794,320
9/25/2008 10/25/2008 129,438,866
10/25/2008 11/25/2008 124,303,712
11/25/2008 12/25/2008 88,895,545
12/25/2008 1/25/2009 85,667,501
1/25/2009 2/25/2009 82,557,083
2/25/2009 3/25/2009 79,559,975
3/25/2009 4/25/2009 76,672,019
4/25/2009 5/25/2009 73,889,213
5/25/2009 6/25/2009 71,207,703
6/25/2009 7/25/2009 68,623,776
7/25/2009 8/25/2009 66,133,859
8/25/2009 9/25/2009 63,734,510
"Swap Provider": The swap provider under the Swap Agreement either (a)
entitled to receive payments from the Supplemental Interest Trust or (b)
required to make payments to the Supplemental Interest Trust, in either case
pursuant to the terms of the Swap Agreement, and any successor in interest or
assign. Initially, the Swap Provider shall be Deutsche Bank AG New York Branch.
"Swap Provider Trigger Event": A Swap Provider Trigger Event shall have
occurred if any of the following has occurred: (i) an Event of Default under the
Swap Agreement with respect to which the Swap Provider is a Defaulting Party (as
defined in the Swap Agreement), (ii) a Termination Event under the Swap
Agreement with respect to which the Swap Provider is the sole Affected Party (as
defined in the Swap Agreement) or (iii) an Additional Termination Event under
the Swap Agreement with respect to which the Swap Provider is the sole Affected
Party.
"Swap Termination Payment": Upon the designation of an "Early
Termination Date" as defined in the Swap Agreement, the payment to be made by
the Supplemental Interest Trust to the Swap Provider, or by the Swap Provider to
the Supplemental Interest Trust, as applicable, pursuant to the terms of the
Swap Agreement.
"Targeted Credit Enhancement Test": With respect to any Distribution
Date and (i) the Class A-1A Certificates, shall be satisfied if on such
Distribution Date the percentage obtained by dividing the Certificate Principal
Balance of the Class A-1A Certificates by the aggregate principal balance of the
Group IA Mortgage Loans is equal to or greater than 51.70%, (ii) the Class A-1B1
Certificates and Class A-1B2 Certificates, shall be satisfied if on such
Distribution Date the percentage obtained by dividing the sum of the Certificate
Principal Balances of the Class A-1B1 Certificates and Class A-1B2 Certificates
by the aggregate principal balance of the Group IB Mortgage Loans is equal to or
greater than 51.70% and (iii) the Class A-2 Certificates, shall be satisfied if
on such Distribution Date the percentage obtained by dividing the sum of the
Certificate Principal Balances of the Class A-2 Certificates by the aggregate
principal balance of the Group II Mortgage Loans is equal to or greater than
51.70%.
"Tax Returns": The federal income tax return on Internal Revenue
Service Form 1066, U.S. Real Estate Mortgage Investment Conduit Income Tax
Return, including Schedule Q thereto, Quarterly Notice to Residual Interest
Holders of REMIC Taxable Income or Net Loss Allocation, or any successor forms,
to be filed on behalf of the Trust REMICs under the REMIC Provisions, together
with any and all other information reports or returns that may be required to be
furnished to the Certificateholders or filed with the Internal Revenue Service
or any other governmental taxing authority under any applicable provisions of
federal, state or local tax laws.
"Telerate Page 3750": The display designated as page "3750" on the Dow
▇▇▇▇▇ Telerate Capital Markets Report (or such other page as may replace page
3750 on that report for the purpose of displaying London interbank offered rates
of major banks).
"Termination Price": As defined in Section 10.01.
"Transfer": Any direct or indirect transfer, sale, pledge,
hypothecation, or other form of assignment of any Ownership Interest in a
Certificate.
"Transferee": Any Person who is acquiring by Transfer any Ownership
Interest in a Certificate.
"Transferor": Any Person who is disposing by Transfer of any Ownership
Interest in a Certificate.
"Trigger Event": A Trigger Event has occurred with respect to a
Distribution Date if either (x) the Delinquency Percentage exceeds 33.25% of the
Credit Enhancement Percentage with respect to such Distribution Date or (y) the
aggregate amount of Realized Losses incurred since the Cut-off Date through the
last day of the related Due Period divided by the aggregate principal balance of
the Mortgage Loans as of the Cut-off Date exceeds the applicable percentages set
forth below with respect to such Distribution Date:
DISTRIBUTION DATE PERCENTAGE
----------------- ----------
December 2007 to November 2008..... 1.40% plus 1/12 of 1.70% for each month thereafter
December 2008 to November 2009..... 3.10% plus 1/12 of 1.75% for each month thereafter
December 2009 to November 2010..... 4.85% plus 1/12 of 1.40% for each month thereafter
December 2010 to November 2011..... 6.25% plus 1/12 of 0.75% for each month thereafter
December 2011 and thereafter....... 7.00%
"Trust": ACE Securities Corp., Home Equity Loan Trust, Series 2005-HE7,
the trust created hereunder.
"Trust Fund": Collectively, all of the assets of REMIC I, REMIC II,
REMIC III and the Reserve Fund and any amounts on deposit therein and any
proceeds thereof. For avoidance of doubt, the Trust Fund does not include the
Supplemental Interest Trust.
"Trust REMIC": REMIC I, REMIC II or REMIC III.
"Trustee": HSBC Bank USA, National Association a national banking
association, or its successor in interest, or any successor trustee appointed as
herein provided.
"Uncertificated Balance": The amount of the REMIC Regular Interests
outstanding as of any date of determination. As of the Closing Date, the
Uncertificated Balance of each REMIC Regular Interest shall equal the amount set
forth in the Preliminary Statement hereto as its initial uncertificated balance.
On each Distribution Date, the Uncertificated Balance of the REMIC Regular
Interest shall be reduced by all distributions of principal made on such REMIC
Regular Interest on such Distribution Date pursuant to Section 5.01 of this
Agreement and, if and to the extent necessary and appropriate, shall be further
reduced on such Distribution Date by Realized Losses as provided in Section 5.04
of this Agreement and the Uncertificated Balance of REMIC II Regular Interest ZZ
shall be increased by interest deferrals as provided in Section 5.01 of this
Agreement. The Uncertificated Balance of each REMIC Regular Interest shall never
be less than zero.
"Uncertificated Interest": With respect to any REMIC Regular Interest
for any Distribution Date, one month's interest at the related REMIC Remittance
Rate applicable to such REMIC Regular Interest for such Distribution Date,
accrued on the Uncertificated Balance thereof immediately prior to such
Distribution Date. Uncertificated Interest in respect of the REMIC Regular
Interests shall accrue on the basis of a 360-day year consisting of twelve
30-day months. Uncertificated Interest with respect to each Distribution Date,
as to any REMIC Regular Interest, shall be reduced by an amount equal to the sum
of (a) the aggregate Prepayment Interest Shortfall, if any, for such
Distribution Date to the extent not covered by payments pursuant to Section 3.22
or Section 4.18 of this Agreement and (b) the aggregate amount of any Relief Act
Interest Shortfall, if any allocated, in each case, to such REMIC Regular
Interest or REMIC Regular Interest pursuant to Section 1.02 of this Agreement.
In addition, Uncertificated Interest with respect to each Distribution Date, as
to any REMIC Regular Interest, shall be reduced by Realized Losses, if any,
allocated to such REMIC Regular Interest pursuant to Section 1.02 and Section
5.04 of this Agreement.
"Uncertificated Notional Amount": With respect to REMIC II Regular
Interest IO and each Distribution Date listed below, the aggregate
Uncertificated Balance of the REMIC I Regular Interests ending with the
designation "A" listed below:
DISTRIBUTION DATE REMIC I REGULAR INTERESTS
----------------- --------------------------------------------------------------------------------
1 I-1-A through I-46-A, II-1-A through II-46-A and III-1-A through III-46-A
2 I-2-A through I-46-A, II-2-A through II-46-A and III-2-A through III-46-A
3 I-3-A through I-46-A, II-3-A through II-46-A and III-3-A through III-46-A
4 I-4-A through I-46-A, II-4-A through II-46-A and III-4-A through III-46-A
5 I-5-A through I-46-A, II-5-A through II-46-A and III-5-A through III-46-A
6 I-6-A through I-46-A, II-6-A through II-46-A and III-6-A through III-46-A
7 I-7-A through I-46-A, II-7-A through II-46-A and III-7-A through III-46-A
8 I-8-A through I-46-A, II-8-A through II-46-A and III-8-A through III-46-A
9 I-9-A through I-46-A, II-9-A through II-46-A and III-9-A through III-46-A
10 I-10-A through I-46-A, II-10-A through II-46-A and III-10-A through III-46-A
11 I-11-A through I-46-A, II-11-A through II-46-A and III-11-A through III-46-A
12 I-12-A through I-46-A, II-12-A through II-46-A and III-12-A through III-46-A
13 I-13-A through I-46-A, II-13-A through II-46-A and III-13-A through III-46-A
14 I-14-A through I-46-A, II-14-A through II-46-A and III-14-A through III-46-A
15 I-15-A through I-46-A, II-15-A through II-46-A and III-15-A through III-46-A
16 I-16-A through I-46-A, II-16-A through II-46-A and III-16-A through III-46-A
17 I-17-A through I-46-A, II-17-A through II-46-A and III-17-A through III-46-A
18 I-18-A through I-46-A, II-18-A through II-46-A and III-18-A through III-46-A
19 I-19-A through I-46-A, II-19-A through II-46-A and III-19-A through III-46-A
20 I-20-A through I-46-A, II-20-A through II-46-A and III-20-A through III-46-A
21 I-21-A through I-46-A, II-21-A through II-46-A and III-21-A through III-46-A
22 I-22-A through I-46-A, II-22-A through II-46-A and III-22-A through III-46-A
23 I-23-A through I-46-A, II-23-A through II-46-A and III-23-A through III-46-A
24 I-24-A through I-46-A, II-24-A through II-46-A and III-24-A through III-46-A
25 I-25-A through I-46-A, II-25-A through II-46-A and III-25-A through III-46-A
26 I-26-A through I-46-A, II-26-A through II-46-A and III-26-A through III-46-A
27 I-27-A through I-46-A, II-27-A through II-46-A and III-27-A through III-46-A
28 I-28-A through I-46-A, II-28-A through II-46-A and III-28-A through III-46-A
29 I-29-A through I-46-A, II-29-A through II-46-A and III-29-A through III-46-A
30 I-30-A through I-46-A, II-30-A through II-46-A and III-30-A through III-46-A
31 I-31-A through I-46-A, II-31-A through II-46-A and III-31-A through III-46-A
32 I-32-A through I-46-A, II-32-A through II-46-A and III-32-A through III-46-A
33 I-33-A through I-46-A, II-33-A through II-46-A and III-33-A through III-46-A
34 I-34-A through I-46-A, II-34-A through II-46-A and III-34-A through III-46-A
35 I-35-A through I-46-A, II-35-A through II-46-A and III-35-A through III-46-A
36 I-36-A through I-46-A, II-36-A through II-46-A and III-36-A through III-46-A
37 I-37-A through I-46-A, II-37-A through II-46-A and III-37-A through III-46-A
38 I-38-A through I-46-A, II-38-A through II-46-A and III-38-A through III-46-A
39 I-39-A through I-46-A, II-39-A through II-46-A and III-39-A through III-46-A
40 I-40-A through I-46-A, II-40-A through II-46-A and III-40-A through III-46-A
41 I-41-A through I-46-A, II-41-A through II-46-A and III-41-A through III-46-A
42 I-42-A through I-46-A, II-42-A through II-46-A and III-42-A through III-46-A
43 I-43-A through I-46-A, II-43-A through II-46-A and III-43-A through III-46-A
44 I-44-A through I-46-A, II-44-A through II-46-A and III-44-A through III-46-A
45 I-45-A through I-46-A, II-45-A through II-46-A and III-45-A through III-46-A
46 I-46-A, II-46-A and III-46-A
thereafter 0.00
With respect to the REMIC III Regular Interest IO and any Distribution
Date, an amount equal to the Uncertificated Notional Amount of the REMIC II
Regular Interest IO. With respect to the Class IO Interest and any Distribution
Date, an amount equal to the Uncertificated Notional Amount of the REMIC III
Regular Interest IO.
"Uninsured Cause": Any cause of damage to a Mortgaged Property such
that the complete restoration of such property is not fully reimbursable by the
hazard insurance policies required to be maintained pursuant to Section 3.11 of
this Agreement.
"United States Person": A citizen or resident of the United States, a
corporation, partnership or other entity created or organized in, or under the
laws of, the United States or any political subdivision thereof (except, in the
case of a partnership, to the extent provided in regulations) provided that, for
purposes solely of the restrictions on the transfer of any Class R Certificate,
no partnership or other entity treated as a partnership for United States
federal income tax purposes shall be treated as a United States Person unless
all persons that own an interest in such partnership either directly or through
any entity that is not a corporation for United States federal income tax
purposes are required to be United States Persons, or an estate whose income is
subject to United States federal income tax regardless of its source, or a trust
if a court within the United States is able to exercise primary supervision over
the administration of the trust and one or more United States persons have the
authority to control all substantial decisions of the trust. To the extent
prescribed in regulations by the Secretary of the Treasury, a trust which was in
existence on August 20, 1996 (other than a trust treated as owned by the grantor
under subpart E of part I of subchapter J of chapter I of the Code), and which
was treated as a United States person on August 20, 1996 may elect to continue
to be treated as a United States person notwithstanding the previous sentence.
The term "United States" shall have the meaning set forth in Section 7701 of the
Code.
"Value": With respect to any Mortgaged Property, the lesser of (i) the
lesser of (a) the value thereof as determined by an appraisal made for the
related originator of the Mortgage Loan at the time of origination of the
Mortgage Loan by an appraiser who met the minimum requirements of ▇▇▇▇▇▇ ▇▇▇ and
▇▇▇▇▇▇▇ Mac and (b) the value thereof as determined by a review appraisal
conducted by the related originator of the Mortgage Loan in accordance with the
related originator's underwriting guidelines, and (ii) the purchase price paid
for the related Mortgaged Property by the Mortgagor with the proceeds of the
Mortgage Loan; provided, however, (A) in the case of a Refinanced Mortgage Loan,
such value of the Mortgaged Property is based solely upon the lesser of (1) the
value determined by an appraisal made for the related originator of the Mortgage
Loan of such Refinanced Mortgage Loan at the time of origination of such
Refinanced Mortgage Loan by an appraiser who met the minimum requirements of
▇▇▇▇▇▇ Mae and ▇▇▇▇▇▇▇ Mac and (2) the value thereof as determined by a review
appraisal conducted by the related originator of the Mortgage Loan in accordance
with the related originator's underwriting guidelines, and (B) in the case of a
Mortgage Loan originated in connection with a "lease-option purchase," such
value of the Mortgaged Property is based on the lower of the value determined by
an appraisal made for the originator of such Mortgage Loan at the time of
origination or the sale price of such Mortgaged Property if the "lease option
purchase price" was set less than twelve (12) months prior to origination, and
is based on the value determined by an appraisal made for the related originator
of such Mortgage Loan at the time of origination if the "lease option purchase
price" was set twelve (12) months or more prior to origination.
"Verification Report": As defined in Section 4.19.
"Voting Rights": The portion of the voting rights of all of the
Certificates which is allocated to any such Certificate. With respect to any
date of determination, 98% of all Voting Rights will be allocated among the
holders of the Class A Certificates, the Mezzanine Certificates and the Class CE
Certificates in proportion to the then outstanding Certificate Principal
Balances of their respective Certificates, 1% of all Voting Rights will be
allocated among the holders of the Class P Certificates and 1% of all Voting
Rights will be allocated among the holders of the Class R Certificates. The
Voting Rights allocated to each Class of Certificate shall be allocated among
Holders of each such Class in accordance with their respective Percentage
Interests as of the most recent Record Date.
"▇▇▇▇▇ Fargo": Either (i) ▇▇▇▇▇ Fargo Bank, National Association in its
capacity as a Servicer or any successor thereto appointed hereunder in
connection with the servicing and administration of the ▇▇▇▇▇ Fargo Mortgage
Loans or (ii) ▇▇▇▇▇ Fargo Bank, National Association in its capacity as a
Custodian under the ▇▇▇▇▇ Fargo Custodial Agreement or any successor thereto.
"▇▇▇▇▇ Fargo Custodial Agreement": The Custodial Agreement dated as of
November 1, 2005, among the Trustee, ▇▇▇▇▇ Fargo and the Servicers, as may be
amended or supplemented from time to time.
"▇▇▇▇▇ Fargo Mortgage Loans": The Mortgage Loans being serviced by
▇▇▇▇▇ Fargo pursuant to the terms of this Agreement as specified on the Mortgage
Loan Schedule.
SECTION 1.02. Allocation of Certain Interest Shortfalls.
For purposes of calculating the amount of Accrued Certificate Interest
and the amount of the Interest Distribution Amount for the Class A Certificates,
the Mezzanine Certificates and the Class CE Certificates for any Distribution
Date, (1) the aggregate amount of any Prepayment Interest Shortfalls (to the
extent not covered by payments by the related Servicer pursuant to Section 3.22
of this Agreement or the Servicing Agreement, or by the Master Servicer pursuant
to Section 4.18 of this Agreement) and any Relief Act Interest Shortfalls
incurred in respect of the Mortgage Loans for any Distribution Date shall be
allocated first, to the Class CE Certificates, second, to the Class M-11
Certificates, third, to the Class M-10 Certificates, fourth, to the Class M-9
Certificates, fifth, to the Class M-8 Certificates, sixth, to the Class M-7
Certificates, seventh, to the Class M-6 Certificates, eighth, to the Class M-5
Certificates, ninth, to the Class M-4 Certificates, tenth, to the Class M-3
Certificates, eleventh, to the Class M-2 Certificates, twelfth, to the Class M-1
Certificates and thirteenth, to the Class A Certificates, on a PRO RATA basis,
in each case based on, and to the extent of, one month's interest at the then
applicable respective Pass-Through Rate on the respective Certificate Principal
Balance or Notional Amount, as applicable, of each such Certificate and (2) the
aggregate amount of any Realized Losses allocated to the Mezzanine Certificates
and Net WAC Rate Carryover Amounts paid to the Class A Certificates and the
Mezzanine Certificates incurred for any Distribution Date shall be allocated to
the Class CE Certificates on a PRO RATA basis based on, and to the extent of,
one month's interest at the then applicable respective Pass-Through Rate on the
respective Certificate Principal Balance or Notional Amount thereof, as
applicable.
For purposes of calculating the amount of Uncertificated Interest for
the REMIC I Group IA Regular Interests for any Distribution Date, the aggregate
amount of any Prepayment Interest Shortfalls (to the extent not covered by
payments by the related Servicer pursuant to Section 3.22 of this Agreement or
pursuant to the Servicing Agreement, as applicable, or the Master Servicer
pursuant to Section 4.18 of this Agreement) and any Relief Act Interest
Shortfalls incurred in respect of Group IA Mortgage Loans shall be allocated
first, to REMIC I Regular Interest A-I and to the REMIC I Group IA Regular
Interests ending with the designation "B", PRO RATA based on, and to the extent
of, one month's interest at the then applicable respective REMIC I Remittance
Rates on the respective Uncertificated Principal Balances of each such REMIC I
Regular Interest, and then, to REMIC I Group IA Regular Interests ending with
the designation "A", pro rata based on, and to the extent of, one month's
interest at the then applicable respective REMIC I Remittance Rates on the
respective Uncertificated Balances of each such REMIC I Regular Interest.
For purposes of calculating the amount of Uncertificated Interest for
the REMIC I Group IB Regular Interests for any Distribution Date, the aggregate
amount of any Prepayment Interest Shortfalls (to the extent not covered by
payments by the related Servicer pursuant to Section 3.22 of this Agreement or
pursuant to the Servicing Agreement, as applicable, or the Master Servicer
pursuant to Section 4.18 of this Agreement) and any Relief Act Interest
Shortfalls incurred in respect of Group IB Mortgage Loans shall be allocated
first, to REMIC I Regular Interest A-II and to the REMIC I Group IB Regular
Interests ending with the designation "B", PRO RATA based on, and to the extent
of, one month's interest at the then applicable respective REMIC I Remittance
Rates on the respective Uncertificated Principal Balances of each such REMIC I
Regular Interest , and then, to REMIC I Group IB Regular Interests ending with
the designation "A", pro rata based on, and to the extent of, one month's
interest at the then applicable respective REMIC I Remittance Rates on the
respective Uncertificated Balances of each such REMIC I Regular Interest.
For purposes of calculating the amount of Uncertificated Interest for
the REMIC I Group II Regular Interests for any Distribution Date, the aggregate
amount of any Prepayment Interest Shortfalls (to the extent not covered by
payments by the related Servicer pursuant to Section 3.22 of this Agreement or
pursuant to the Servicing Agreement, as applicable, or the Master Servicer
pursuant to Section 4.18 of this Agreement) and any Relief Act Interest
Shortfalls incurred in respect of Group II Mortgage Loans shall be allocated
first, to REMIC I Regular Interest A-III and to the REMIC I Group II Regular
Interests ending with the designation "B", PRO RATA based on, and to the extent
of, one month's interest at the then applicable respective REMIC I Remittance
Rates on the respective Uncertificated Principal Balances of each such REMIC I
Regular Interest, and then, to REMIC I Group II Regular Interests ending with
the designation "A", pro rata based on, and to the extent of, one month's
interest at the then applicable respective REMIC I Remittance Rates on the
respective Uncertificated Balances of each such REMIC I Regular Interest.
For purposes of calculating the amount of Uncertificated Interest for
the REMIC II Regular Interests for any Distribution Date:
(A) The REMIC II Marker Allocation Percentage of the aggregate
amount of any Prepayment Interest Shortfalls (to the extent not covered
by payments by the related Servicer pursuant to Section 3.22 of this
Agreement or pursuant to the Servicing Agreement, as applicable, or the
Master Servicer pursuant to Section 4.18 of this Agreement) and the
REMIC II Marker Allocation Percentage of any Relief Act Interest
Shortfalls incurred in respect of the Mortgage Loans for any
Distribution Date shall be allocated among REMIC II Regular Interest
AA, REMIC II Regular Interest A-1A, REMIC II Regular Interest A-1B1,
REMIC II Regular Interest A-1B2, REMIC II Regular Interest A-2A, REMIC
II Regular Interest A-2B, REMIC II Regular Interest A-2C, REMIC II
Regular Interest A-2D, REMIC II Regular Interest M-1, REMIC II Regular
Interest M-2, REMIC II Regular Interest M-3, REMIC II Regular Interest
M-4, REMIC II Regular Interest M-5, REMIC II Regular Interest M-6,
REMIC II Regular Interest M-7, REMIC II Regular Interest M-8, REMIC II
Regular Interest M-9, REMIC II Regular Interest M-10, REMIC II Regular
Interest M-11 and REMIC II Regular Interest ZZ PRO RATA based on, and
to the extent of, one month's interest at the then applicable
respective REMIC II Remittance Rate on the respective Uncertificated
Balance of each such REMIC II Regular Interest; and
(B) The REMIC II Sub WAC Allocation Percentage of the
aggregate amount of any Prepayment Interest Shortfalls (to the extent
not covered by payments by the related Servicer pursuant to Section
3.22 of this Agreement or pursuant to the Servicing Agreement, as
applicable, or by the Master Servicer pursuant to Section 4.18 of this
Agreement) and the REMIC II Sub WAC Allocation Percentage of any Relief
Act Interest Shortfalls incurred in respect of the Mortgage Loans for
any Distribution Date shall be allocated first, to Uncertificated
Interest payable to REMIC II Regular Interest IA-SUB, REMIC II Regular
Interest IA-GRP, REMIC II Regular Interest IB-SUB, REMIC II Regular
Interest IB-GRP, REMIC II Regular Interest II-SUB, REMIC II Regular
Interest II-GRP and REMIC II Regular Interest XX, PRO RATA based on,
and to the extent of, one month's interest at the then applicable
respective REMIC II Remittance Rate on the respective Uncertificated
Balance of each such REMIC II Regular Interest.
ARTICLE II
CONVEYANCE OF MORTGAGE LOANS;
ORIGINAL ISSUANCE OF CERTIFICATES
SECTION 2.01. Conveyance of the Mortgage Loans.
The Depositor, concurrently with the execution and delivery hereof,
does hereby transfer, assign, set over and otherwise convey to the Trustee, on
behalf of the Trust, without recourse, for the benefit of the
Certificateholders, all the right, title and interest of the Depositor,
including any security interest therein for the benefit of the Depositor, in and
to the Mortgage Loans identified on the Mortgage Loan Schedule, the rights of
the Depositor under the Mortgage Loan Purchase Agreement and the Assignment
Agreement (including, without limitation the right to enforce the obligations of
the other parties thereto thereunder), the right to any Net Swap Payment and any
Swap Termination Payment made by the Swap Provider and all other assets included
or to be included in REMIC I. Such assignment includes all interest and
principal received by the Depositor and the Servicers on or with respect to the
Mortgage Loans (other than payments of principal and interest due on such
Mortgage Loans on or before the Cut-off Date). The Depositor herewith delivers
to the Trustee and each Servicer an executed copy of the Mortgage Loan Purchase
Agreement.
In connection with such transfer and assignment, the Depositor does
hereby deliver to, and deposit with the Custodian pursuant to the related
Custodial Agreement the documents with respect to each Mortgage Loan as
described under Section 2 of the Custodial Agreement (the "Mortgage Loan
Documents"). In connection with such delivery and as further described in the
Custodial Agreements, the Custodians will be required to review such Mortgage
Loan Documents and deliver to the Trustee, the Depositor, the related Servicer
and the Seller certifications (in the forms attached to the Custodial Agreement)
with respect to such review with exceptions noted thereon. In addition, under
the Custodial Agreements the Depositor will be required to cure certain defects
with respect to the Mortgage Loan Documents for the related Mortgage Loans after
the delivery thereof by the Depositor to the Custodians as more particularly set
forth therein.
Notwithstanding anything to the contrary contained herein, the parties
hereto acknowledge that the functions of the Trustee with respect to the
custody, acceptance, inspection and release of the Mortgage Files, including,
but not limited to certain insurance policies and documents contemplated by
Section 4.11 of this Agreement, and preparation and delivery of the
certifications shall be performed by the Custodians pursuant to the terms and
conditions of the Custodial Agreements.
The Depositor shall deliver or cause the related originator to deliver
to the related Servicer copies of all trailing documents required to be included
in the related Mortgage File at the same time the originals or certified copies
thereof are delivered to the Trustee or Custodians, such documents including the
mortgagee policy of title insurance and any Mortgage Loan Documents upon return
from the recording office. The Servicers shall not be responsible for any
custodian fees or other costs incurred in obtaining such documents and the
Depositor shall cause the Servicers to be reimbursed for any such costs the
Servicers may incur in connection with performing their obligations under this
Agreement or under the Servicing Agreement, as applicable.
The Mortgage Loans permitted by the terms of this Agreement to be
included in the Trust are limited to (i) Mortgage Loans (which the Depositor
acquired pursuant to the Mortgage Loan Purchase Agreement, which contains, among
other representations and warranties, a representation and warranty of the
Seller that no Mortgage Loan is a "High-Cost Home Loan" as defined in the New
Jersey Home Ownership Act effective November 27, 2003, as defined in the New
Mexico Home Loan Protection Act effective January 1, 2004, as defined in the
Massachusetts Predatory Home Loan Practices Act, effective November 7, 2004
(Mass. ▇▇▇. Laws Ch. 183C) or as defined in the Indiana Home Loan Practices Act,
effective January 1, 2005 (Ind. Code ▇▇▇. Sections 24-9-1 through 24-9-9)) and
(ii) Qualified Substitute Mortgage Loans (which, by definition as set forth
herein and referred to in the Mortgage Loan Purchase Agreement, are required to
conform to, among other representations and warranties, the representation and
warranty of the Seller that no Qualified Substitute Mortgage Loan is a
"High-Cost Home Loan" as defined in the New Jersey Home Ownership Act effective
November 27, 2003 or as defined in the New Mexico Home Loan Protection Act
effective January 1, 2004, as defined in the Massachusetts Predatory Home Loan
Practices Act, effective November 7, 2004 (Mass. ▇▇▇. Laws Ch. 183C) or as
defined in the Indiana Home Loan Practices Act, effective January 1, 2005 (Ind.
Code ▇▇▇. Sections 24-9-1 through 24-9-9). The Depositor and the Trustee on
behalf of the Trust understand and agree that it is not intended that any
mortgage loan be included in the Trust that is a "High-Cost Home Loan" as
defined in the New Jersey Home Ownership Act effective November 27, 2003, as
defined in the New Mexico Home Loan Protection Act effective January 1, 2004, as
defined in the Massachusetts Predatory Home Loan Practices Act, effective
November 7, 2004 (Mass. ▇▇▇. Laws Ch. 183C) or as defined in the Indiana Home
Loan Practices Act, effective January 1, 2005 (Ind. Code ▇▇▇. Sections 24-9-1
through 24-9-9).
SECTION 2.02. Acceptance of REMIC I by Trustee.
The Trustee acknowledges receipt, subject to the provisions of Section
2.01 hereof and Section 2 of the Custodial Agreement, of the Mortgage Loan
Documents and all other assets included in the definition of "REMIC I" under
clauses (i), (iii), (iv) and (v) (to the extent of amounts deposited into the
Distribution Account) and declares that it holds (or the applicable Custodian on
its behalf holds) and will hold such documents and the other documents delivered
to it constituting a Mortgage Loan Document, and that it holds (or the
applicable Custodian on its behalf holds) or will hold all such assets and such
other assets included in the definition of "REMIC I" in trust for the exclusive
use and benefit of all present and future Certificateholders.
SECTION 2.03. Repurchase or Substitution of Mortgage Loans.
(a) Upon discovery or receipt of notice of any materially defective
document in, or that a document is missing from, a Mortgage File or of a breach
by the Seller of any representation, warranty or covenant under the Mortgage
Loan Purchase Agreement in respect of any Mortgage Loan that materially and
adversely affects the value of such Mortgage Loan or the interest therein of the
Certificateholders, the Trustee shall promptly notify the Seller and the related
Servicer of such defect, missing document or breach and request that the Seller
deliver such missing document, cure such defect or breach within sixty (60) days
from the date the Seller was notified of such missing document, defect or
breach, and if the Seller does not deliver such missing document or cure such
defect or breach in all material respects during such period, the Trustee shall
enforce the obligations of the Seller under the Mortgage Loan Purchase Agreement
to repurchase such Mortgage Loan from REMIC I at the Purchase Price within
ninety (90) days after the date on which the Seller was notified of such missing
document, defect or breach, if and to the extent that the Seller is obligated to
do so under the Mortgage Loan Purchase Agreement. The Purchase Price for the
repurchased Mortgage Loan shall be remitted to the related Servicer for deposit
in the related Collection Account or Custodial Account, as applicable, the
related and the Trustee, upon receipt of written certification from such
Servicer of such deposit, shall release or cause the applicable Custodian (upon
receipt of a request for release in the form attached to the respective
Custodial Agreement) to release to the Seller the related Mortgage File and the
Trustee shall execute and deliver such instruments of transfer or assignment, in
each case without recourse, representation or warranty, as the Seller shall
furnish to it and as shall be necessary to vest in the Seller any Mortgage Loan
released pursuant hereto, and the Trustee shall not have any further
responsibility with regard to such Mortgage File. In lieu of repurchasing any
such Mortgage Loan as provided above, if so provided in the Mortgage Loan
Purchase Agreement, the Seller may cause such Mortgage Loan to be removed from
REMIC I (in which case it shall become a Deleted Mortgage Loan) and substitute
one or more Qualified Substitute Mortgage Loans in the manner and subject to the
limitations set forth in Section 2.03(b) of this Agreement. It is understood and
agreed that the obligation of the Seller to cure or to repurchase (or to
substitute for) any 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 respecting such
omission, defect or breach available to the Trustee and the Certificateholders.
Notwithstanding anything to the contrary contained herein, any breach of a
representation or warranty contained in clauses (xxxiv), (xxxviii), (xxxix),
(xl), (xli), (xlvi), (xlvii) and/or (lvi) of Section 6 of the Mortgage Loan
Purchase Agreement shall be automatically deemed to affect materially and
adversely the interests of the Certificateholders.
In addition, promptly upon the earlier of discovery by a Servicer or
receipt of notice by a Servicer of the breach of the representation or covenant
of the Seller set forth in Section 5(xii) of the Mortgage Loan Purchase
Agreement which materially and adversely affects the interests of the Holders of
the Class P Certificates in any Prepayment Charge, such Servicer shall promptly
notify the Seller and the Trustee of such breach. The Trustee shall enforce the
obligations of the Seller under the Mortgage Loan Purchase Agreement to remedy
such breach to the extent and in the manner set forth in the Mortgage Loan
Purchase Agreement.
(b) Any substitution of Qualified Substitute Mortgage Loans for Deleted
Mortgage Loans made pursuant to Section 2.03(a) of this Agreement must be
effected prior to the date which is two years after the Startup Day for REMIC I.
As to any Deleted Mortgage Loan for which the Seller substitutes a
Qualified Substitute Mortgage Loan or Loans, such substitution shall be effected
by the Seller delivering to the Trustee or the applicable Custodian on behalf of
the Trustee, for such Qualified Substitute Mortgage Loan or Loans, the Mortgage
Note, the Mortgage, the Assignment to the Trustee, and such other documents and
agreements, with all necessary endorsements thereon, as are required by Section
2 of the Custodial Agreement, as applicable, together with an Officers'
Certificate providing that each such Qualified Substitute Mortgage Loan
satisfies the definition thereof and specifying the Substitution Shortfall
Amount (as described below), if any, in connection with such substitution. The
applicable Custodian on behalf of the Trustee shall acknowledge receipt of such
Qualified Substitute Mortgage Loan or Loans and, within ten (10) Business Days
thereafter, review such documents and deliver to the Depositor, the Trustee and
the related Servicer, with respect to such Qualified Substitute Mortgage Loan or
Loans, an initial certification pursuant to the Custodial Agreement, with any
applicable exceptions noted thereon. Within one year of the date of
substitution, the applicable Custodian on behalf of the Trustee shall deliver to
the Depositor, the Trustee and the related Servicer a final certification
pursuant to the Custodial Agreement with respect to such Qualified Substitute
Mortgage Loan or Loans, with any applicable exceptions noted thereon. Monthly
Payments due with respect to Qualified Substitute Mortgage Loans in the month of
substitution are not part of REMIC I and will be retained by the Seller. For the
month of substitution, distributions to Certificateholders will reflect the
Monthly Payment due on such Deleted Mortgage Loan on or before the Due Date in
the month of substitution, and the Seller shall thereafter be entitled to retain
all amounts subsequently received in respect of such Deleted Mortgage Loan. The
Depositor shall give or cause to be given written notice to the
Certificateholders that such substitution has taken place, shall amend the
Mortgage Loan Schedule to reflect the removal of such Deleted Mortgage Loan from
the terms of this Agreement and the substitution of the Qualified Substitute
Mortgage Loan or Loans and shall deliver a copy of such amended Mortgage Loan
Schedule to the Trustee and the related Servicer. Upon such substitution, such
Qualified Substitute Mortgage Loan or Loans shall constitute part of the Trust
Fund and shall be subject in all respects to the terms of this Agreement and the
Mortgage Loan Purchase Agreement, including all applicable representations and
warranties thereof included herein or in the Mortgage Loan Purchase Agreement.
For any month in which the Seller substitutes one or more Qualified
Substitute Mortgage Loans for one or more Deleted Mortgage Loans, the related
Servicer will determine the amount (the "Substitution Shortfall Amount"), if
any, by which the aggregate Purchase Price of all such Deleted Mortgage Loans
exceeds the aggregate of, as to each such Qualified Substitute Mortgage Loan,
the Scheduled Principal Balance thereof as of the date of substitution, together
with one month's interest on such Scheduled Principal Balance at the applicable
Net Mortgage Rate, plus all outstanding P&I Advances and Servicing Advances
(including Nonrecoverable P&I Advances and Nonrecoverable Servicing Advances)
related thereto. On the date of such substitution, the Seller will deliver or
cause to be delivered to the related Servicer for deposit in the related
Collection Account or the Custodial Account an amount equal to the Substitution
Shortfall Amount, if any, and the Trustee or the applicable Custodian on behalf
of the Trustee, upon receipt of the related Qualified Substitute Mortgage Loan
or Loans, upon receipt of a request for release in the form attached to the
respective Custodial Agreement and certification by the related Servicer of such
deposit, shall release to the Seller the related Mortgage File or Files and the
Trustee shall execute and deliver such instruments of transfer or assignment, in
each case without recourse, representation or warranty, as the Seller shall
deliver to it and as shall be necessary to vest therein any Deleted Mortgage
Loan released pursuant hereto.
In addition, the Seller shall obtain at its own expense and deliver to
the Trustee an Opinion of Counsel to the effect that such substitution will not
cause (a) any federal tax to be imposed on any Trust REMIC, including without
limitation, any federal tax imposed on "prohibited transactions" under Section
860F(a)(1) of the Code or on "contributions after the startup date" under
Section 860G(d)(1) of the Code, or (b) any Trust REMIC to fail to qualify as a
REMIC at any time that any Certificate is outstanding.
(c) Upon discovery by the Depositor, the Seller, a Servicer 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 (2) Business Days give written notice thereof to the other
parties. In connection therewith, the Seller shall repurchase or substitute one
or more Qualified Substitute Mortgage Loans for the affected Mortgage Loan
within ninety (90) days of the earlier of discovery or receipt of such notice
with respect to such affected Mortgage Loan. Such repurchase or substitution
shall be made by (i) the Seller if the affected Mortgage Loan's status as a
non-qualified mortgage is or results from a breach of any representation,
warranty or covenant made by the Seller under the Mortgage Loan Purchase
Agreement or (ii) the Depositor, if the affected Mortgage Loan's status as a
non-qualified mortgage does not result from a breach of a representation or
warranty. Any such repurchase or substitution shall be made in the same manner
as set forth in Section 2.03(a) of this Agreement. The Trustee shall reconvey to
the Seller 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.
(d) With respect to a breach of the representations made pursuant to
Section 5(xii) of the Mortgage Loan Purchase Agreement that materially and
adversely affects the value of such Mortgage Loan or the interest therein of the
Certificateholders, the Seller shall be required to take the actions set forth
in this Section 2.03 of this Agreement.
(e) Within ninety (90) days of the earlier of discovery by ▇▇▇▇▇ Fargo
or receipt of notice by ▇▇▇▇▇ Fargo of the breach of any representation,
warranty or covenant of ▇▇▇▇▇ Fargo set forth in Section 2.05 of this Agreement
which materially and adversely affects the interests of the Certificateholders
in any Mortgage Loan or Prepayment Charge, ▇▇▇▇▇ Fargo shall cure such breach in
all material respects.
SECTION 2.04. Representations and Warranties of the Master Servicer.
The Master Servicer hereby represents, warrants and covenants to ▇▇▇▇▇
Fargo, the Depositor and the Trustee, for the benefit of each of the Trustee and
the Certificateholders, that as of the Closing Date or as of such date
specifically provided herein:
(i) The Master Servicer is a national banking association duly
formed, validly existing and in good standing under the laws of the
United States of America and is duly authorized and qualified to
transact any and all business contemplated by this Agreement to be
conducted by the Master Servicer;
(ii) The Master Servicer has the full power and authority to
conduct its business as presently conducted by it and to execute,
deliver and perform, and to enter into and consummate, all transactions
contemplated by this Agreement. The Master Servicer has duly authorized
the execution, delivery and performance of this Agreement, has duly
executed and delivered this Agreement, and this Agreement, assuming due
authorization, execution and delivery by the other parties hereto,
constitutes a legal, valid and binding obligation of the Master
Servicer, enforceable against it in accordance with its terms except as
the enforceability thereof may be limited by bankruptcy, insolvency,
reorganization or similar laws affecting the enforcement of creditors'
rights generally and by general principles of equity;
(iii) The execution and delivery of this Agreement by the
Master Servicer, the consummation by the Master Servicer of any other
of the transactions herein contemplated, and the fulfillment of or
compliance with the terms hereof are in the ordinary course of business
of the Master Servicer and will not (A) result in a breach of any term
or provision of the charter and by-laws of the Master Servicer or (B)
conflict with, result in a breach, violation or acceleration of, or
result in a default under, the terms of any other material agreement or
instrument to which the Master Servicer is a party or by which it may
be bound, or any statute, order or regulation applicable to the Master
Servicer of any court, regulatory body, administrative agency or
governmental body having jurisdiction over the Master Servicer; and the
Master Servicer is not a party to, bound by, or in breach or violation
of any indenture or other agreement or instrument, or subject to or in
violation of any statute, order or regulation of any court, regulatory
body, administrative agency or governmental body having jurisdiction
over it, which materially and adversely affects or, to the Master
Servicer's knowledge, would in the future materially and adversely
affect, (x) the ability of the Master Servicer to perform its
obligations under this Agreement or (y) the business, operations,
financial condition, properties or assets of the Master Servicer taken
as a whole;
(iv) The Master Servicer does not believe, nor does it have
any reason or cause to believe, that it cannot perform each and every
covenant made by it and contained in this Agreement;
(v) No litigation is pending against the Master Servicer that
would materially and adversely affect the execution, delivery or
enforceability of this Agreement or the ability of the Master Servicer
to perform any of its other obligations hereunder in accordance with
the terms hereof;
(vi) There are no actions or proceedings against, or
investigations known to it of, the Master Servicer before any court,
administrative or other tribunal (A) that might prohibit its entering
into this Agreement, (B) seeking to prevent the consummation of the
transactions contemplated by this Agreement or (C) that might prohibit
or materially and adversely affect the performance by the Master
Servicer of its obligations under, or validity or enforceability of,
this Agreement; and
(vii) No consent, approval, authorization or order of any
court or governmental agency or body is required for the execution,
delivery and performance by the Master Servicer of, or compliance by
the Master Servicer with, this Agreement or the consummation by it of
the transactions contemplated by this Agreement, except for such
consents, approvals, authorizations or orders, if any, that have been
obtained prior to the Closing Date.
It is understood and agreed that the representations, warranties and
covenants set forth in this Section 2.04 shall survive the resignation or
termination of the parties hereto and the termination of this Agreement and
shall inure to the benefit of the Trustee, the Depositor and the
Certificateholders.
SECTION 2.05. Representations, Warranties and Covenants of ▇▇▇▇▇ Fargo.
(a) ▇▇▇▇▇ Fargo in its capacity as Servicer of the ▇▇▇▇▇ Fargo Mortgage
Loans hereby represents, warrants and covenants to the Master Servicer, the
Securities Administrator, the Depositor and the Trustee, for the benefit of each
of such Persons and the Certificateholders that as of the Closing Date or as of
such date specifically provided herein:
(i) ▇▇▇▇▇ Fargo is a national banking association duly formed,
validly existing and in good standing under the laws of the United
States of America and is duly authorized and qualified to transact any
and all business contemplated by this Agreement to be conducted by
▇▇▇▇▇ Fargo in any state in which a Mortgaged Property related to a
▇▇▇▇▇ Fargo Mortgage Loan is located or is otherwise not required under
applicable law to effect such qualification and, in any event, is in
compliance with the doing business laws of any such State, to the
extent necessary to ensure its ability to enforce each ▇▇▇▇▇ Fargo
Mortgage Loan and to service the ▇▇▇▇▇ Fargo Mortgage Loans in
accordance with the terms of this Agreement;
(ii) ▇▇▇▇▇ Fargo has the full power and authority to conduct
its business as presently conducted by it and to execute, deliver and
perform, and to enter into and consummate, all transactions
contemplated by this Agreement. ▇▇▇▇▇ Fargo has duly authorized the
execution, delivery and performance of this Agreement, has duly
executed and delivered this Agreement, and this Agreement, assuming due
authorization, execution and delivery by the other parties hereto,
constitutes a legal, valid and binding obligation of ▇▇▇▇▇ Fargo,
enforceable against it in accordance with its terms, except as the
enforceability thereof may be limited by insolvency, liquidation,
conservatorship and other similar laws administered by the FDIC
affecting the enforcement of contract obligations of insured banks;
(iii) The execution and delivery of this Agreement by ▇▇▇▇▇
Fargo, the servicing of the ▇▇▇▇▇ Fargo Mortgage Loans by ▇▇▇▇▇ Fargo
hereunder, the consummation by ▇▇▇▇▇ Fargo of any other of the
transactions herein contemplated, and the fulfillment of or compliance
with the terms hereof are in the ordinary course of business of ▇▇▇▇▇
Fargo and will not (A) result in a breach of any term or provision of
the charter or by-laws of ▇▇▇▇▇ Fargo or (B) conflict with, result in a
breach, violation or acceleration of, or result in a default under, the
terms of any other material agreement or instrument to which ▇▇▇▇▇
Fargo is a party or by which it may be bound, or any statute, order or
regulation applicable to ▇▇▇▇▇ Fargo of any court, regulatory body,
administrative agency or governmental body having jurisdiction over
▇▇▇▇▇ Fargo; and ▇▇▇▇▇ Fargo is not a party to, bound by, or in breach
or violation of any indenture or other agreement or instrument, or
subject to or in violation of any statute, order or regulation of any
court, regulatory body, administrative agency or governmental body
having jurisdiction over it, which materially and adversely affects or,
to ▇▇▇▇▇ Fargo's knowledge, would in the future materially and
adversely affect, (x) the ability of ▇▇▇▇▇ Fargo to perform its
obligations as Servicer of the ▇▇▇▇▇ Fargo Mortgage Loans under this
Agreement, (y) the business, operations, financial condition,
properties or assets of ▇▇▇▇▇ Fargo taken as a whole or (z) the
legality, validity or enforceability of this Agreement;
(iv) ▇▇▇▇▇ Fargo does not believe, nor does it have any reason
or cause to believe, that it cannot perform each and every covenant
made by it and contained in this Agreement;
(v) No litigation is pending against ▇▇▇▇▇ Fargo that would
materially and adversely affect the execution, delivery or
enforceability of this Agreement or the ability of ▇▇▇▇▇ Fargo to
service the ▇▇▇▇▇ Fargo Mortgage Loans or to perform any of its other
obligations hereunder in accordance with the terms hereof;
(vi) There are no actions or proceedings against, or
investigations known to it of, ▇▇▇▇▇ Fargo before any court,
administrative or other tribunal (A) that might prohibit its entering
into this Agreement, (B) seeking to prevent the consummation of the
transactions contemplated by this Agreement or (C) that might prohibit
or materially and adversely affect the performance by ▇▇▇▇▇ Fargo of
its obligations under, or the validity or enforceability of, this
Agreement;
(vii) No consent, approval, authorization or order of any
court or governmental agency or body is required for the execution,
delivery and performance by ▇▇▇▇▇ Fargo of, or compliance by ▇▇▇▇▇
Fargo with, this Agreement or the consummation by it of the
transactions contemplated by this Agreement, except for such consents,
approvals, authorizations or orders, if any, that have been obtained
prior to the Closing Date;
(viii) ▇▇▇▇▇ Fargo has fully furnished and will continue to
fully furnish, in accordance with the Fair Credit Reporting Act and its
implementing regulations, accurate and complete information (e.g.,
favorable and unfavorable) on its borrower credit files to Equifax,
Experian and Trans Union Credit Information Company or their successors
on a monthly basis;
(ix) ▇▇▇▇▇ Fargo is a member of MERS in good standing, and
will comply in all material respects with the rules and procedures of
MERS in connection with the servicing of the ▇▇▇▇▇ Fargo Mortgage Loans
that are registered with MERS; and
(x) ▇▇▇▇▇ Fargo will not waive any Prepayment Charge other
than in accordance with the standard set forth in Section 3.01.
(b) [Reserved]
(c) It is understood and agreed that the representations, warranties
and covenants set forth in this Section 2.05 shall survive the resignation or
termination of the parties hereto, the termination of this Agreement and the
delivery of the Mortgage Files to the Custodians and shall inure to the benefit
of the Trustee, the Master Servicer, the Securities Administrator, the Depositor
and the Certificateholders. Upon discovery by any such Person or the related
Servicer of a breach of any of the foregoing representations, warranties and
covenants which materially and adversely affects the value of any Mortgage Loan,
Prepayment Charge or the interests therein of the Certificateholders, the party
discovering such breach shall give prompt written notice (but in no event later
than two (2) Business Days following such discovery) to the Trustee. Subject to
Section 8.01, unless such breach shall not be susceptible of cure within ninety
(90) days, the obligation of the related Servicer set forth in Section 2.03(e)
to cure breaches shall constitute the sole remedy against the related Servicer
available to the Certificateholders, the Depositor or the Trustee on behalf of
the Certificateholders respecting a breach of the representations, warranties
and covenants contained in this Section 2.05.
SECTION 2.06. Issuance of the REMIC I Regular Interests and the Class
R-I Interest.
The Trustee acknowledges the assignment to it of the Mortgage Loans and
the delivery to the applicable Custodian on its behalf of the Mortgage Loan
Documents, subject to the provisions of Section 2.01 and Section 2.02 hereof and
Section 2 of the respective Custodial Agreement, together with the assignment to
it of all other assets included in REMIC I, the receipt of which is hereby
acknowledged. The interests evidenced by the Class R-I Interest, together with
the REMIC I Regular Interests, constitute the entire beneficial ownership
interest in REMIC I. The rights of the Holders of the Class R-I Interest and
REMIC I (as holder of the REMIC I Regular Interests) to receive distributions
from the proceeds of REMIC I in respect of the Class R-I Interest and the REMIC
I Regular Interests, respectively, and all ownership interests evidenced or
constituted by the Class R-I Interest and the REMIC I Regular Interests, shall
be as set forth in this Agreement.
SECTION 2.07. Conveyance of the REMIC I Regular Interests; Acceptance
of REMIC II and REMIC III by the Trustee.
The Depositor, concurrently with the execution and delivery hereof,
does hereby transfer, assign, set over and otherwise convey to the Trustee,
without recourse all the right, title and interest of the Depositor in and to
the REMIC I Regular Interests for the benefit of the Class R-II Interest and
REMIC II (as holder of the REMIC I Regular Interests). The Trustee acknowledges
receipt of the REMIC I Regular Interests and declares that it holds and will
hold the same in trust for the exclusive use and benefit of all present and
future Holders of the Class R-II Interest and REMIC II (as holder of the REMIC I
Regular Interests). The rights of the Holder of the Class R-II Interest and
REMIC II (as holder of the REMIC I Regular Interests) to receive distributions
from the proceeds of REMIC II in respect of the Class R-II Interest and the
REMIC II Regular Interests, respectively, and all ownership interests evidenced
or constituted by the Class R-II Interest and the REMIC II Regular Interests,
shall be as set forth in this Agreement. The Class R-II Interest and the REMIC
II Regular Interests shall constitute the entire beneficial ownership interest
in REMIC II. The Trustee acknowledges receipt of the REMIC II Regular Interests
and declares that it holds and will hold the same in trust for the exclusive use
and benefit of all present and future Holders of the Class R-III Interest and
REMIC III (as holder of the REMIC II Regular Interests). The rights of the
Holder of the Class R-III Interest and REMIC III (as holder of the REMIC II
Regular Interests) to receive distributions from the proceeds of REMIC III in
respect of the Class R-III Interest and the Regular Certificates, respectively,
and all ownership interests evidenced or constituted by the Class R-III Interest
and the Regular Certificates, shall be as set forth in this Agreement. The Class
R-III Interest and the Regular Certificates shall constitute the entire
beneficial ownership interest in REMIC III.
SECTION 2.08. Issuance of the Residual Certificates.
The Trustee acknowledges the assignment to it of the REMIC I Regular
Interests and, concurrently therewith and in exchange therefor, pursuant to the
written request of the Depositor executed by an officer of the Depositor, the
Securities Administrator has executed and authenticated and the Trustee has
delivered to or upon the order of the Depositor, the Class R Certificates in
authorized denominations. The Class R Certificates evidence ownership in the
Class R-I Interest, the Class R-II Interest and the Class R-III Interest.
SECTION 2.09. Establishment of the Trust.
The Depositor does hereby establish, pursuant to the further provisions
of this Agreement and the laws of the State of New York, an express trust to be
known, for convenience, as "ACE Securities Corp., Home Equity Loan Trust, Series
2005-HE7" and does hereby appoint HSBC Bank USA, National Association as Trustee
in accordance with the provisions of this Agreement.
ARTICLE III
ADMINISTRATION AND SERVICING
OF THE ▇▇▇▇▇ FARGO MORTGAGE LOANS; ACCOUNTS
SECTION 3.01. ▇▇▇▇▇ Fargo to Act as Servicer.
The obligations of ▇▇▇▇▇ Fargo hereunder to service and administer the
Mortgage Loans shall be limited to the ▇▇▇▇▇ Fargo Mortgage Loans, and with
respect to the duties and obligations of ▇▇▇▇▇ Fargo, references herein to the
related Mortgage Loans shall be limited to the ▇▇▇▇▇ Fargo Mortgage Loans (and
the related proceeds and related REO Properties). In addition, from and after
the Closing Date, the Countrywide Mortgage Loans will be serviced and
administered by Countrywide pursuant to the Servicing Agreement, and ▇▇▇▇▇ Fargo
will have no responsibility to service or administer such Mortgage Loans or have
any other obligation with respect to such Mortgage Loans (including reporting or
remitting funds to the Master Servicer). Except as otherwise expressly stated
herein, references in this Article III to "Servicer" shall refer to ▇▇▇▇▇ Fargo,
and any successor thereto as a Servicer.
On and after the Closing Date, ▇▇▇▇▇ Fargo shall service and administer
the ▇▇▇▇▇ Fargo Mortgage Loans on behalf of the Trust Fund and in the best
interests of and for the benefit of the Certificateholders (as determined by
▇▇▇▇▇ Fargo in its reasonable judgment) in accordance with the terms of this
Agreement and the respective Mortgage Loans and all applicable law and
regulations and, to the extent consistent with such terms, in the same manner in
which it services and administers similar mortgage loans for its own portfolio,
giving due consideration to customary and usual standards of practice of prudent
mortgage lenders and loan servicers administering similar mortgage loans but
without regard to:
(i) any relationship that ▇▇▇▇▇ Fargo or any of its Affiliates
may have with the related Mortgagor;
(ii) the ownership of any Certificate by ▇▇▇▇▇ Fargo or any of
its Affiliates;
(iii) ▇▇▇▇▇ Fargo's obligation to make P&I Advances or
Servicing Advances; or
(iv) ▇▇▇▇▇ Fargo's right to receive compensation for its
services hereunder;
To the extent consistent with the foregoing, ▇▇▇▇▇ Fargo shall also
seek to maximize the timely and complete recovery of principal and interest on
the related Mortgage Notes and shall waive (or permit a Sub-Servicer to waive) a
Prepayment Charge only under the following circumstances: (i) such waiver is
standard and customary in servicing similar Mortgage Loans and such waiver is
related to a default or reasonably foreseeable default and would, in the
reasonable judgment of ▇▇▇▇▇ Fargo, maximize recovery of total proceeds taking
into account the value of such Prepayment Charge and the related Mortgage Loan
and, if such waiver is made in connection with a refinancing of the related
Mortgage Loan, such refinancing is related to a default or a reasonably
foreseeable default, (ii) such Prepayment Charge is unenforceable in accordance
with applicable law or the collection of such related Prepayment Charge would
otherwise violate applicable law or (iii) the collection of such Prepayment
Charge would be considered "predatory" pursuant to written guidance published or
issued by any applicable federal, state or local regulatory authority acting in
its official capacity and having jurisdiction over such matters. If the Servicer
waives any Prepayment Charge other than pursuant to the standard set forth in
this Section 3.01, the Servicer will pay the amount of such waived Prepayment
Charge, from its own funds without any right of reimbursement, for the benefit
of the Holders of the Class P Certificates, by depositing such amount into the
Collection Account within ninety (90) days of the earlier of discovery by the
Servicer or receipt of notice by the Servicer of such breach. Furthermore,
notwithstanding any other provisions of this Agreement, any payments made by the
Servicer in respect of any waived Prepayment Charges pursuant to this paragraph
shall be deemed to be paid outside of the Trust Fund.
Notwithstanding any provision in this Agreement to the contrary, in the
event the Prepayment Charge payable under the terms of the Mortgage Note is less
than the amount of the Prepayment Charge set forth in the Prepayment Charge
Schedule or other information provided to ▇▇▇▇▇ Fargo, ▇▇▇▇▇ Fargo and the
Master Servicer shall not have any liability or obligation with respect to such
difference (including any obligation to recalculate any prepayment charges), and
in addition shall not have any liability or obligation to pay the amount of any
uncollected Prepayment Charge if the failure to collect such amount is the
direct result of inaccurate or incomplete information on the Prepayment Charge
Schedule.
Subject only to the above-described servicing standards (the "Accepted
Servicing Practices") and the terms of this Agreement and of the related
Mortgage Loans, ▇▇▇▇▇ Fargo shall have full power and authority, to do or cause
to be done any and all things in connection with such servicing and
administration which it may deem necessary or desirable with the goal of
maximizing proceeds of the Mortgage Loan. Without limiting the generality of the
foregoing, ▇▇▇▇▇ Fargo in its own name is hereby authorized and empowered by the
Trustee when ▇▇▇▇▇ Fargo believes it appropriate in its best judgment, to
execute and deliver, on behalf of the Trust Fund, the Certificateholders and the
Trustee or any of them, and upon written notice to the Trustee, any and all
instruments of satisfaction or cancellation, or of partial or full release or
discharge or subordination, and all other comparable instruments, with respect
to the related Mortgage Loans and the related Mortgaged Properties and to
institute foreclosure proceedings or obtain a deed-in-lieu of foreclosure so as
to convert the ownership of such properties, and to hold or cause to be held
title to such properties, on behalf of the Trustee, for the benefit of the Trust
Fund and the Certificateholders. ▇▇▇▇▇ Fargo shall service and administer the
▇▇▇▇▇ Fargo Mortgage Loans in accordance with applicable state and federal law
and shall provide to the Mortgagors any reports required to be provided to them
thereby. ▇▇▇▇▇ Fargo shall also comply in the performance of this Agreement with
all reasonable rules and requirements of each insurer under any standard hazard
insurance policy. Subject to Section 3.14, the Trustee shall execute, at the
written request of a Servicer, and furnish to such Servicer a power of attorney
in the form of Exhibit D hereto and other documents necessary or appropriate to
enable such Servicer to carry out its servicing and administrative duties
hereunder or under the Servicing Agreement, as applicable, and furnished to the
Trustee by such Servicer, and the Trustee shall not be liable for the actions of
such Servicer under such powers of attorney and shall be indemnified by such
Servicer for any cost, liability or expense incurred by the Trustee in
connection with such Servicer's use or misuse of any such power of attorney.
In accordance with Accepted Servicing Practices, ▇▇▇▇▇ Fargo shall make
or cause to be made Servicing Advances as necessary for the purpose of effecting
the payment of taxes and assessments on the Mortgaged Properties, which
Servicing Advances shall be reimbursable in the first instance from related
collections from the related Mortgagors pursuant to Section 3.07 of this
Agreement, and further as provided in Section 3.09 of this Agreement; provided,
however, ▇▇▇▇▇ Fargo shall only make such Servicing Advance if the related
Mortgagor has not made such payment and if the failure to make such Servicing
Advance would result in the loss of the related Mortgaged Property due to a tax
sale or foreclosure as result of a tax lien. Any cost incurred by ▇▇▇▇▇ Fargo in
effecting the payment of taxes and assessments on a Mortgaged Property shall
not, for the purpose of calculating the Stated Principal Balance of such
Mortgage Loan or distributions to Certificateholders, be added to the unpaid
principal balance of the related Mortgage Loan, notwithstanding that the terms
of such Mortgage Loan so permit. The parties to this Agreement acknowledge that
Servicing Advances shall be reimbursable pursuant to Section 3.09 of this
Agreement, and agree that no Servicing Advance shall be rejected or disallowed
by any party unless it has been shown that such Servicing Advance was not made
in accordance with the terms of this Agreement.
Notwithstanding anything in this Agreement to the contrary, no Servicer
may make any future advances with respect to a Mortgage Loan and no Servicer
shall permit any modification with respect to any related Mortgage Loan that
would change the Mortgage Rate, reduce or increase the principal balance (except
for reductions resulting from actual payments of principal) or change the final
maturity date on such related Mortgage Loan (unless, as provided in Section 3.06
of this Agreement, the related Mortgagor is in default with respect to the
related Mortgage Loan or such default is, in the judgment of ▇▇▇▇▇ Fargo,
reasonably foreseeable) or any modification, waiver or amendment of any term of
any related Mortgage Loan that would both (A) effect an exchange or reissuance
of such Mortgage Loan under Section 1001 of the Code (or final, temporary or
proposed Treasury regulations promulgated thereunder) and (B) cause any Trust
REMIC created hereunder to fail to qualify as a REMIC under the Code or the
imposition of any tax on "prohibited transactions" or "contributions after the
startup date" under the REMIC Provisions.
In the event that the Mortgage Loan Documents relating to a Mortgage
Loan contain provisions requiring the related Mortgagor to arbitrate disputes
(at the option of the Trustee, on behalf of the Trust), the Trustee hereby
authorizes ▇▇▇▇▇ Fargo to waive the Trustee's right or option to arbitrate
disputes and to send written notice of such waiver to the Mortgagor, although
the Mortgagor may still require arbitration at its option.
▇▇▇▇▇ Fargo will fully furnish, in accordance with the Fair Credit
Reporting Act and its implementing regulations, accurate and complete
information (e.g., favorable and unfavorable) on its borrower credit files to
Equifax, Experian and Trans Union Credit Information Company or their successors
on a monthly basis.
SECTION 3.02. Sub-Servicing Agreements Between a Servicer and
Sub-Servicers.
The Servicer may arrange for the subservicing of any Mortgage Loan by a
Sub- Servicer pursuant to a Sub-Servicing Agreement; provided that such
sub-servicing arrangement and the terms of the related Sub-Servicing Agreement
must provide for the servicing of such Mortgage Loans in a manner consistent
with the servicing arrangements contemplated hereunder. Each Sub-Servicer shall
be (i) authorized to transact business in the state or states where the related
Mortgaged Properties it is to service are situated, if and to the extent
required by applicable law to enable the Sub-Servicer to perform its obligations
hereunder and under the Sub-Servicing Agreement and (ii) a ▇▇▇▇▇▇▇ Mac or ▇▇▇▇▇▇
Mae approved mortgage servicer. Notwithstanding the provisions of any
Sub-Servicing Agreement, any of the provisions of this Agreement relating to
agreements or arrangements between a Servicer or a Sub-Servicer or reference to
actions taken through the Servicer or otherwise, the Servicer shall remain
obligated and liable to the Depositor, the Trustee and the Certificateholders
for the servicing and administration of the Mortgage Loans in accordance with
the provisions of this Agreement without diminution of such obligation or
liability by virtue of such Sub-Servicing Agreements or arrangements or by
virtue of indemnification from the Sub-Servicer and to the same extent and under
the same terms and conditions as if such Servicer alone were servicing and
administering the Mortgage Loans. Every Sub-Servicing Agreement entered into by
a Servicer shall contain a provision giving the successor servicer the option to
terminate such agreement in the event a successor servicer is appointed. All
actions of each Sub-Servicer performed pursuant to the related Sub-Servicing
Agreement shall be performed as an agent of the Servicer with the same force and
effect as if performed directly by such Servicer.
For purposes of this Agreement, the related Servicer shall be deemed to
have received any collections, recoveries or payments with respect to the
Mortgage Loans that are received by a Sub-Servicer regardless of whether such
payments are remitted by the Sub-Servicer to the related Servicer.
SECTION 3.03. Successor Sub-Servicers.
Any Sub-Servicing Agreement shall provide that ▇▇▇▇▇ Fargo shall be
entitled to terminate any Sub-Servicing Agreement and to either itself directly
service the related Mortgage Loans or enter into a Sub-Servicing Agreement with
a successor Sub-Servicer which qualifies under Section 3.02. Any Sub-Servicing
Agreement shall include the provision that such agreement may be immediately
terminated by any successor to ▇▇▇▇▇ Fargo (which may be the Trustee or the
Master Servicer) without fee, in accordance with the terms of this Agreement, in
the event that ▇▇▇▇▇ Fargo (or any successor to ▇▇▇▇▇ Fargo) shall, for any
reason, no longer be the Servicer of the related Mortgage Loans (including
termination due to a Servicer Event of Default).
SECTION 3.04. No Contractual Relationship Between Sub-Servicer, Trustee
or the Certificateholders.
Any Sub-Servicing Agreement and any other transactions or services
relating to the Mortgage Loans involving a Sub-Servicer shall be deemed to be
between the Sub-Servicer and ▇▇▇▇▇ Fargo alone and the Master Servicer, Trustee
and the Certificateholders shall not be deemed parties thereto and shall have no
claims, rights, obligations, duties or liabilities with respect to any
Sub-Servicer except as set forth in Section 3.05 of this Agreement.
SECTION 3.05. Assumption or Termination of Sub-Servicing Agreement by
Successor Servicer.
In connection with the assumption of the responsibilities, duties and
liabilities and of the authority, power and rights of ▇▇▇▇▇ Fargo hereunder by a
successor servicer (which may be the Trustee or the Master Servicer) pursuant to
Section 8.02, it is understood and agreed that such Servicer's rights and
obligations under any Sub-Servicing Agreement then in force between such
Servicer and a Sub-Servicer shall be assumed simultaneously by such successor
servicer without act or deed on the part of such successor servicer; provided,
however, that any successor servicer may terminate the Sub-Servicer.
Each Servicer shall, upon the reasonable request of the Master
Servicer, but at its own expense, deliver to the assuming party documents and
records relating to each Sub-Servicing Agreement and an accounting of amounts
collected and held by it and otherwise use its best efforts to effect the
orderly and efficient transfer of the Sub-Servicing Agreements to the assuming
party.
The Servicing Fee payable to any such successor servicer shall be
payable from payments received on the related Mortgage Loans in the amount and
in the manner set forth in this Agreement.
SECTION 3.06. Collection of Certain Mortgage Loan Payments.
▇▇▇▇▇ Fargo shall make reasonable efforts to collect all payments
called for under the terms and provisions of the related Mortgage Loans, and
shall, to the extent such procedures shall be consistent with this Agreement and
Accepted Servicing Practices, follow such collection procedures as it would
follow with respect to mortgage loans comparable to the Mortgage Loans and held
for its own account. Consistent with the foregoing, ▇▇▇▇▇ Fargo may in its
discretion (i) waive any late payment charge or, if applicable, penalty interest
or (ii) extend the due dates for the Monthly Payments due on a Mortgage Note
related to a Mortgage Loan for a period of not greater than 180 days; provided
that any extension pursuant to this clause shall not affect the amortization
schedule of any Mortgage Loan for purposes of any computation hereunder.
Notwithstanding the foregoing, in the event that any Mortgage Loan is in default
or, in the judgment of ▇▇▇▇▇ Fargo, such default is reasonably foreseeable,
▇▇▇▇▇ Fargo, consistent with Accepted Servicing Practices may waive, modify or
vary any term of such Mortgage Loan (including modifications that change the
Mortgage Rate, forgive the payment of principal or interest or extend the final
maturity date of such Mortgage Loan), accept payment from the related Mortgagor
of an amount less than the Stated Principal Balance in final satisfaction of
such Mortgage Loan, or consent to the postponement of strict compliance with any
such term or otherwise grant indulgence to any Mortgagor if in ▇▇▇▇▇ Fargo's
determination such waiver, modification, postponement or indulgence is not
materially adverse to the interests of the Certificateholders (taking into
account any estimated Realized Loss that might result absent such action).
SECTION 3.07. Collection of Taxes, Assessments and Similar Items;
Servicing Accounts. To the extent the terms of a Mortgage provide for Escrow
Payments, ▇▇▇▇▇ Fargo shall establish and maintain one or more accounts (the
"Servicing Accounts"), into which all collections from the Mortgagors (or
related advances from Sub-Servicers) for the payment of taxes, assessments,
fire, flood, and hazard insurance premiums, and comparable items for the account
of the Mortgagors ("Escrow Payments") shall be deposited and retained. Servicing
Accounts shall be Eligible Accounts. ▇▇▇▇▇ Fargo shall deposit in the Servicing
Accounts on a daily basis and in no event later than the second Business Day
after receipt, and retain therein, all Escrow Payments collected on account of
the Mortgage Loans, for the purpose of effecting the timely payment of any such
items as required under the terms of this Agreement. Withdrawals of amounts from
a Servicing Account may be made by ▇▇▇▇▇ Fargo only to (i) effect timely payment
of taxes, assessments, fire, flood, and hazard insurance premiums, and
comparable items; (ii) reimburse itself out of related collections for any
Servicing Advances made pursuant to Section 3.01 (with respect to taxes and
assessments) and Section 3.11 (with respect to fire, flood and hazard
insurance); (iii) refund to Mortgagors any sums as may be determined to be
overages; (iv) pay interest, if required and as described below, to Mortgagors
on balances in the Servicing Account; or, only to the extent not required to be
paid to the related Mortgagors, to pay itself interest on balances in the
Servicing Account; or (v) clear and terminate the Servicing Account at the
termination of ▇▇▇▇▇ Fargo's obligations and responsibilities in respect of the
Mortgage Loans under this Agreement in accordance with Article X. As part of its
servicing duties, ▇▇▇▇▇ Fargo shall pay to the Mortgagors interest on funds in
Servicing Accounts, to the extent required by law and, to the extent that
interest earned on funds in the Servicing Accounts is insufficient, to pay such
interest from its or their own funds, without any reimbursement therefor.
Notwithstanding the foregoing, no Servicer shall be obligated to collect Escrow
Payments if the related Mortgage Loan does not require such payments but ▇▇▇▇▇
Fargo shall nevertheless be obligated to make Servicing Advances as provided in
Section 3.01 and Section 3.11. In the event a Servicer shall deposit in the
Servicing Accounts any amount not required to be deposited therein, it may at
any time withdraw such amount from the Servicing Accounts, any provision to the
contrary notwithstanding.
To the extent that a Mortgage does not provide for Escrow Payments,
▇▇▇▇▇ Fargo (i) shall determine whether any such payments are made by the
Mortgagor in a manner and at a time that is necessary to avoid the loss of the
Mortgaged Property due to a tax sale or the foreclosure as a result of a tax
lien and (ii) shall ensure that all insurance required to be maintained on the
Mortgaged Property pursuant to this Agreement is maintained. If any such payment
has not been made and ▇▇▇▇▇ Fargo receives notice of a tax lien with respect to
the Mortgage Loan being imposed, ▇▇▇▇▇ Fargo shall, promptly and to the extent
required to avoid loss of the Mortgaged Property, advance or cause to be
advanced funds necessary to discharge such lien on the Mortgaged Property unless
▇▇▇▇▇ Fargo determines the advance to be nonrecoverable. ▇▇▇▇▇ Fargo assumes
full responsibility for the payment of all such bills and shall effect payments
of all such bills irrespective of the Mortgagor's faithful performance in the
payment of same or the making of the Escrow Payments and shall make Servicing
Advances to effect such payments subject to its determination of recoverability.
SECTION 3.08. Collection Account, Simple Interest Excess Sub-Account
and Distribution Account.
(a) On behalf of the Trust Fund, ▇▇▇▇▇ Fargo shall establish and
maintain one or more "Collection Accounts", held in trust for the benefit of the
Trustee and the Certificateholders. On behalf of the Trust Fund, ▇▇▇▇▇ Fargo
shall deposit or cause to be deposited in the Collection Account on a daily
basis and when received or as otherwise required hereunder, the following
payments and collections received or made by it on or subsequent to the Cut-off
Date other than amounts attributable to a Due Date on or prior to the Cut-off
Date:
(i) all payments on account of principal, including Principal
Prepayments, on the related Mortgage Loans;
(ii) all payments on account of interest (net of the related
Servicing Fee and any Prepayment Interest Excess) on each related
Mortgage Loan;
(iii) all Insurance Proceeds and Liquidation Proceeds (other
than proceeds collected in respect of any particular REO Property) and
all Subsequent Recoveries with respect to the related Mortgage Loans;
(iv) any amounts required to be deposited by ▇▇▇▇▇ Fargo
pursuant to Section 3.10 of this Agreement in connection with any
losses realized on Permitted Investments with respect to funds held in
the Collection Account;
(v) any amounts required to be deposited by ▇▇▇▇▇ Fargo
pursuant to the second paragraph of Section 3.11(a)of this Agreement in
respect of any blanket policy deductibles;
(vi) any Purchase Price or Substitution Shortfall Amount
delivered to ▇▇▇▇▇ Fargo and all proceeds (net of amounts payable or
reimbursable to ▇▇▇▇▇ Fargo, the Master Servicer, the Trustee, the
Custodians or the Securities Administrator) of Mortgage Loans purchased
in accordance with Section 2.03, Section 3.13 or Section 10.01 of this
Agreement; and
(vii) any Prepayment Charges collected by ▇▇▇▇▇ Fargo in
connection with the Principal Prepayment of any of the Mortgage Loans
or amounts required to be deposited by ▇▇▇▇▇ Fargo in connection with a
breach of its obligations to collect a Prepayment Charge under Section
3.01 of this Agreement.
The foregoing requirements for deposit in the related Collection
Account shall be exclusive, it being understood and agreed that, without
limiting the generality of the foregoing, payments in the nature of late payment
charges, assumption fees or other similar fees need not be deposited by ▇▇▇▇▇
Fargo in the related Collection Account and may be retained by ▇▇▇▇▇ Fargo as
additional servicing compensation. In the event a Servicer shall deposit in the
related Collection Account any amount not required to be deposited therein, it
may at any time withdraw such amount from the related Collection Account, any
provision herein to the contrary notwithstanding.
(b) Except as set forth below, no later than the Closing Date, each
Servicer servicing Simple Interest Mortgage Loans shall establish and maintain a
sub-account of the Collection Account titled "[Servicer's name], Simple Interest
Excess Sub-Account in trust for the Holders of ACE Securities Corp., Home Equity
Loan Trust, Series 2005-SD3, Asset Backed Pass-Through Certificates". The
related Servicer shall, on each Determination Date transfer from the Collection
Account to the Simple Interest Excess Sub-Account all Net Simple Interest
Excess, if any, pursuant to Section 3.09(a)(xi) of this Agreement, and shall
maintain a record of all such deposits. In lieu of establishing a Simple
Interest Excess Sub-Account, each Servicer may maintain any Net Simple Interest
Excess in the Collection Account and maintain a separate accounting therefor.
The related Servicer shall withdraw amounts on deposit in the Simple
Interest Excess Sub-Account or in the related Collection Account (in respect of
any Net Simple Interest Excess) on each Determination Date for deposit to the
Distribution Account in an amount equal to the lesser of (i) the amount on
deposit therein, and (ii) the Net Simple Interest Shortfall for such
Distribution Date.
The related Servicer shall remit to the Securities Administrator which
shall thereupon distribute to the Class CE-1 Certificateholder, based on the
information provided to it by the Servicer, the amount of any Net Simple
Interest Excess remaining in the Simple Interest Excess Sub-Account or in the
related Collection Account, as applicable, on the Distribution Date each year
occurring in December, commencing in December 2006. Such distributions shall be
deemed to be made on a first-in, first-out basis. In addition, the related
Servicer shall clear and terminate the Simple Interest Excess Sub-Account, if
any, upon the termination of this Agreement and retain any funds remaining
therein.
(c) On behalf of the Trust Fund, the Securities Administrator shall
establish and maintain one or more accounts (such account or accounts, the
"Distribution Account"), held in trust for the benefit of the Trustee, the Trust
Fund and the Certificateholders. On behalf of the Trust Fund, ▇▇▇▇▇ Fargo shall
deliver to the Securities Administrator in immediately available funds for
deposit in the Distribution Account on the Servicer Remittance Date, that
portion of the Available Distribution Amount (calculated without regard to the
references in clause (2) of the definition thereof to amounts that may be
withdrawn from the Distribution Account) for the related Distribution Date then
on deposit in the related Collection Account and the amount of all Prepayment
Charges collected by ▇▇▇▇▇ Fargo in connection with the Principal Prepayment of
any of the Mortgage Loans then on deposit in the related Collection Account and
the amount of any funds reimbursable to an Advance Financing Person pursuant to
Section 3.25 of this Agreement. If the balance on deposit in a Collection
Account exceeds 100,000 as of the commencement of business on any Business Day
and the Collection Account constitutes an Eligible Account solely pursuant to
clause (ii) of the definition of "Eligible Account," ▇▇▇▇▇ Fargo shall, on or
before 5:00 p.m. New York time on such Business Day, withdraw from the
Collection Account any and all amounts payable or reimbursable to the Depositor,
▇▇▇▇▇ Fargo, the Trustee, the Master Servicer, the Securities Administrator or
the Seller pursuant to Section 3.09 of this Agreement and shall pay such amounts
to the Persons entitled thereto or shall establish a separate Collection Account
(which shall also be an Eligible Account) and withdraw from the existing
Collection Account the amount on deposit therein in excess of 100,000 and
deposit such excess in the newly created Collection Account.
With respect to any remittance received by the Securities Administrator
on or after the first Business Day following the Business Day on which such
payment was due, the Securities Administrator shall send written notice thereof
to the Servicer. ▇▇▇▇▇ Fargo shall pay to the Securities Administrator interest
on any such late payment by such Servicer at an annual rate equal to Prime Rate
(as defined in THE WALL STREET JOURNAL) plus one percentage point, but in no
event greater than the maximum amount permitted by applicable law. Such interest
shall be paid by ▇▇▇▇▇ Fargo to the Securities Administrator on the date such
late payment is made and shall cover the period commencing with the day
following the related Servicer Remittance Date and ending with the Business Day
on which such payment is made, both inclusive. The payment by ▇▇▇▇▇ Fargo of any
such interest, or the failure of the Securities Administrator to notify ▇▇▇▇▇
Fargo of such interest, shall not be deemed an extension of time for payment or
a waiver of any Event of Default by ▇▇▇▇▇ Fargo.
(d) Funds in the Collection Accounts, in each Simple Interest Excess
Sub-Account and in the Distribution Account may be invested in Permitted
Investments in accordance with the provisions set forth in Section 3.10. ▇▇▇▇▇
Fargo shall give notice to the Trustee, the Securities Administrator and the
Master Servicer of the location of the Collection Account maintained by it when
established and prior to any change thereof. The Securities Administrator shall
give notice to the Servicers and the Depositor of the location of the
Distribution Account when established and prior to any change thereof.
(e) Funds held in the Collection Account at any time may be delivered
by ▇▇▇▇▇ Fargo in immediately available funds to the Securities Administrator
for deposit in the Distribution Account. In the event a Servicer shall deliver
to the Securities Administrator for deposit in the Distribution Account any
amount not required to be deposited therein, it may at any time request that the
Securities Administrator withdraw such amount from the Distribution Account and
remit to it any such amount, any provision herein to the contrary
notwithstanding. In no event shall the Securities Administrator incur liability
as a result of withdrawals from the Distribution Account at the direction of a
Servicer in accordance with the immediately preceding sentence. In addition,
▇▇▇▇▇ Fargo shall deliver to the Securities Administrator no later than the
Servicer Remittance Date the amounts set forth in clauses (i) through (iv)
below:
(i) any P&I Advances, as required pursuant to Section 5.03 of
this Agreement;
(ii) any amounts required to be deposited pursuant to Section
3.21(d) or 3.21(f) of this Agreement in connection with any related REO
Property;
(iii) any amounts to be paid in connection with a purchase of
Mortgage Loans and REO Properties pursuant to Section 10.01 of this
Agreement; and
(iv) any amounts required to be deposited pursuant to Section
3.22 of this Agreement in connection with any Prepayment Interest
Shortfalls.
SECTION 3.09. Withdrawals from the Collection Account and Distribution
Account.
(a) ▇▇▇▇▇ Fargo shall, from time to time, make withdrawals from the
related Collection Account for any of the following purposes or as described in
Section 5.03 of this Agreement:
(i) to remit to the Securities Administrator for deposit in
the Distribution Account the amounts required to be so remitted
pursuant to Section 3.08(b) of this Agreement or permitted to be so
remitted pursuant to the first sentence of Section 3.08(d) of this
Agreement;
(ii) subject to Section 3.13(d) of this Agreement, to
reimburse itself (including any successor Servicer) for P&I Advances
made by it, but only to the extent of amounts received which represent
Late Collections (net of the related Servicing Fees) of Monthly
Payments on related Mortgage Loans with respect to which such P&I
Advances were made in accordance with the provisions of Section 5.03;
(iii) subject to Section 3.13(d) of this Agreement, to pay
itself any unpaid Servicing Fees and reimburse itself any unreimbursed
Servicing Advances with respect to each related Mortgage Loan, but only
to the extent of any Liquidation Proceeds and Insurance Proceeds
received with respect to such related Mortgage Loan;
(iv) to pay to itself as servicing compensation (in addition
to the Servicing Fee) on the Servicer Remittance Date any interest or
investment income earned on funds deposited in the Collection Account
and the Simple Interest Excess Sub-Account;
(v) to pay to itself or the Seller, as the case may be, with
respect to each related Mortgage Loan that has previously been
purchased or replaced pursuant to Section 2.03 or Section 3.13(c) of
this Agreement all amounts received thereon not included in the
Purchase Price or the Substitution Shortfall Amount;
(vi) to reimburse itself (including any successor to ▇▇▇▇▇
Fargo) for
(A) any P&I Advance or Servicing Advance previously made by it
which ▇▇▇▇▇ Fargo has determined to be a Nonrecoverable P&I
Advance or a Nonrecoverable Servicing Advance in accordance
with the provisions of Section 5.03 of this Agreement; or
(B) any unpaid Servicing Fees to the extent not recoverable
from Liquidation Proceeds, Insurance Proceeds or other amounts
received with respect to the related Mortgage Loan under
Section 3.06(a)(iii) of this Agreement;
(vii) to reimburse itself or the Depositor for expenses
incurred by or reimbursable to itself or the Depositor, as the case may
be, pursuant to Section 3.01 or Section 7.03 of this Agreement;
(viii) to reimburse itself or the Trustee, as the case may be,
for expenses reasonably incurred in respect of the breach or defect
giving rise to the purchase obligation under Section 2.03 of this
Agreement that were included in the Purchase Price of the related
Mortgage Loan, including any expenses arising out of the enforcement of
the purchase obligation;
(ix) to pay, or to reimburse itself for advances in respect
of, expenses incurred in connection with any related Mortgage Loan
pursuant to Section 3.13(b) of this Agreement;
(x) to pay to itself any Prepayment Interest Excess on the
related Mortgage Loans to the extent not retained pursuant to Section
3.08(a)(ii)) of this Agreement;
(xi) to deposit in the Simple Interest Excess Sub-Account any
amount required to be deposited therein pursuant to Section 3.08(b) of
this Agreement; and
(xii) to clear and terminate the Collection Account pursuant
to Section 10.01 of this Agreement.
▇▇▇▇▇ Fargo shall keep and maintain separate accounting, on a Mortgage
Loan by Mortgage Loan basis, for the purpose of justifying any withdrawal from
the related Collection Account, to the extent held by or on behalf of it,
pursuant to subclauses (ii), (iii), (v), (vi), (vii), (viii), (ix) and (x)
above.
(b) The Securities Administrator shall, from time to time, make
withdrawals from the Distribution Account, for any of the following purposes,
without priority:
(i) to make distributions to Certificateholders in accordance
with Section 5.01 of this Agreement;
(ii) to pay to itself, the Custodians and the Master Servicer
amounts to which it is entitled pursuant to Section 9.05 of this
Agreement or any other provision of this Agreement and any
Extraordinary Trust Fund Expenses;
(iii) to reimburse itself or the Master Servicer pursuant to
Section 8.02 of this Agreement;
(iv) to pay any Net Swap Payment or Swap Termination Payment
payable to the Supplemental Interest Trust (unless the Swap Provider is
the sole Defaulting Party or the sole Affected Party (as defined in the
Swap Agreement)) owed to the Swap Provider;
(v) to pay any amounts in respect of taxes pursuant to Section
11.01(g)(v) of this Agreement;
(vi) to pay the Master Servicing Fee to the Master Servicer;
(vii) to pay the Credit Risk Management Fee to the Credit Risk
Manager; and
(viii) to clear and terminate the Distribution Account
pursuant to Section 10.01 of this Agreement.
SECTION 3.10. Investment of Funds in the Investment Accounts.
(a) ▇▇▇▇▇ Fargo may direct, by means of written directions (which may
be standing directions), any depository institution maintaining the related
Collection Account or Simple Interest Excess Sub-Account to invest the funds in
such Collection Account or Simple Interest Excess Sub-Account (for purposes of
this Section 3.10, an "Investment Account") in one or more Permitted Investments
bearing interest or sold at a discount, and maturing, unless payable on demand,
(i) no later than the Business Day immediately preceding the date on which such
funds are required to be withdrawn from such account pursuant to this Agreement,
if a Person other than the Securities Administrator is the obligor thereon, and
(ii) no later than the date on which such funds are required to be withdrawn
from such account pursuant to this Agreement, if the Securities Administrator is
the obligor on such Permitted Investment. Amounts in the Distribution Account
may be invested in Permitted Investments as directed in writing by the Master
Servicer and maturing, unless payable on demand, (i) no later than the Business
Day immediately preceding the date on which such funds are required to be
withdrawn from such account pursuant to this Agreement, if a Person other than
the Securities Administrator is the obligor thereon, and (ii) no later than the
date on which such funds are required to be withdrawn from such account pursuant
to this Agreement, if the Securities Administrator is the obligor thereon. All
such Permitted Investments shall be held to maturity, unless payable on demand.
Any investment of funds shall be made in the name of the Trustee (in its
capacity as such) or in the name of a nominee of the Trustee. The Securities
Administrator shall be entitled to sole possession over each such investment in
the Distribution Account and, subject to subsection (b) below, the income
thereon, and any certificate or other instrument evidencing any such investment
shall be delivered directly to the Securities Administrator or its agent,
together with any document of transfer necessary to transfer title to such
investment to the Trustee or its nominee. In the event amounts on deposit in a
Collection Account are at any time invested in a Permitted Investment payable on
demand, the party with investment discretion over such Investment Account shall:
(x) consistent with any notice required to be given
thereunder, demand that payment thereon be made on the last
day such Permitted Investment may otherwise mature hereunder
in an amount equal to the lesser of (1) all amounts then
payable thereunder and (2) the amount required to be withdrawn
on such date; and
(y) demand payment of all amounts due thereunder promptly upon
receipt by such party of written notice from ▇▇▇▇▇ Fargo that
such Permitted Investment would not constitute a Permitted
Investment in respect of funds thereafter on deposit in the
Investment Account.
(b) All income and gain realized from the investment of funds deposited
in a Collection Account or Simple Interest Excess Sub-Account shall be for the
benefit of the related Servicer and shall be subject to its withdrawal in
accordance with Section 3.09. ▇▇▇▇▇ Fargo shall deposit in the Collection
Account or Simple Interest Excess Sub-Account maintained by it the amount of any
loss incurred in respect of any such Permitted Investment made with funds in
such account immediately upon realization of such loss. All earnings and gain
realized from the investment of funds deposited in the Distribution Account
shall be for the benefit of the Master Servicer. The Master Servicer shall remit
from its own funds for deposit into the Distribution Account the amount of any
loss incurred on Permitted Investments in the Distribution Account.
(c) Except as otherwise expressly provided in this Agreement, if any
default occurs in the making of a payment due under any Permitted Investment, or
if a default occurs in any other performance required under any Permitted
Investment, the Trustee may and, subject to Section 9.01 and Section 9.02(a)(v),
shall, at the written direction of ▇▇▇▇▇ Fargo, take such action as may be
appropriate to enforce such payment or performance, including the institution
and prosecution of appropriate proceedings.
(d) The Trustee, the Master Servicer or their respective Affiliates are
permitted to receive additional compensation that could be deemed to be in the
Trustee's or the Master Servicer's economic self-interest for (i) serving as
investment adviser, administrator, shareholder servicing agent, custodian or
sub-custodian with respect to certain of the Permitted Investments, (ii) using
Affiliates to effect transactions in certain Permitted Investments and (iii)
effecting transactions in certain Permitted Investments. Such compensation shall
not be considered an amount that is reimbursable or payable to the Trustee or
the Master Servicer pursuant to Section 3.09 or 3.10 or otherwise payable in
respect of Extraordinary Trust Fund Expenses. Such additional compensation shall
not be an expense of the Trust Fund.
SECTION 3.11. Maintenance of Hazard Insurance, Errors and Omissions and
Fidelity Coverage and Primary Mortgage Insurance.
(a) The terms of each Mortgage Note require the related Mortgagor to
maintain fire, flood and hazard insurance policies. To the extent such policies
are not maintained, ▇▇▇▇▇ Fargo shall cause to be maintained for each Mortgaged
Property fire and hazard insurance with extended coverage as is customary in the
area where the Mortgaged Property is located in an amount which is at least
equal to the lesser of the current principal balance of the related Mortgage
Loan and the amount necessary to compensate fully for any damage or loss to the
improvements which are a part of such property on a replacement cost basis, in
each case in an amount not less than such amount as is necessary to avoid the
application of any coinsurance clause contained in the related hazard insurance
policy. ▇▇▇▇▇ Fargo shall also cause to be maintained fire and hazard insurance
on each REO Property with extended coverage as is customary in the area where
the Mortgaged Property is located in an amount which is at least equal to the
lesser of (i) the maximum insurable value of the improvements which are a part
of such property and (ii) the outstanding principal balance of the related
Mortgage Loan at the time it became an REO Property. ▇▇▇▇▇ Fargo will comply in
the performance of this Agreement with all reasonable rules and requirements of
each insurer under any such hazard policies. Any amounts to be collected by a
Servicer under any such policies (other than amounts to be applied to the
restoration or repair of the property subject to the related Mortgage or amounts
to be released to the Mortgagor in accordance with Accepted Servicing Practices,
subject to the terms and conditions of the related Mortgage and Mortgage Note)
shall be deposited in the related Collection Account, subject to withdrawal
pursuant to Section 3.09, if received in respect of a Mortgage Loan, or in the
REO Account, subject to withdrawal pursuant to Section 3.21, if received in
respect of an REO Property. Any cost incurred by a Servicer in maintaining any
such insurance shall not, for the purpose of calculating distributions to
Certificateholders, be added to the unpaid principal balance of the related
Mortgage Loan, notwithstanding that the terms of such Mortgage Loan so permit.
It is understood and agreed that no earthquake or other additional insurance is
to be required of any Mortgagor other than pursuant to such applicable laws and
regulations as shall at any time be in force and as shall require such
additional insurance. If the Mortgaged Property or REO Property is at any time
in an area identified in the Federal Register by the Federal Emergency
Management Agency as having special flood hazards, ▇▇▇▇▇ Fargo will cause to be
maintained a flood insurance policy in respect thereof. Such flood insurance
shall be in an amount equal to the lesser of (i) the unpaid principal balance of
the related Mortgage Loan and (ii) the maximum amount of such insurance
available for the related Mortgaged Property under the national flood insurance
program (assuming that the area in which such Mortgaged Property is located is
participating in such program).
In the event that ▇▇▇▇▇ Fargo shall obtain and maintain a blanket
policy with an insurer having a General Policy Rating of B:VI or better in
Best's Key Rating Guide or otherwise acceptable to ▇▇▇▇▇▇ Mae or ▇▇▇▇▇▇▇ Mac
insuring against hazard losses on all of the related Mortgage Loans, it shall
conclusively be deemed to have satisfied its obligations to cause fire and
hazard insurance to be maintained on the Mortgaged Properties, it being
understood and agreed that such policy may contain a deductible clause, in which
case ▇▇▇▇▇ Fargo shall, in the event that there shall not have been maintained
on the related Mortgaged Property or REO Property a policy complying with the
first two sentences of this Section 3.11, and there shall have been one or more
losses which would have been covered by such policy, deposit to the related
Collection Account from its own funds the amount not otherwise payable under the
blanket policy because of such deductible clause. In connection with its
activities as administrator and servicer of the related Mortgage Loans, ▇▇▇▇▇
Fargo agrees to prepare and present, on behalf of itself, the Trustee, the Trust
Fund, the Certificateholders, claims under any such blanket policy in a timely
fashion in accordance with the terms of such policy.
(b) ▇▇▇▇▇ Fargo shall keep in force during the term of this Agreement a
policy or policies of insurance covering errors and omissions for failure in the
performance of its respective obligations under this Agreement, which policy or
policies shall be in such form and amount that would meet the requirements of
▇▇▇▇▇▇ ▇▇▇ or ▇▇▇▇▇▇▇ Mac if it were the purchaser of the related Mortgage
Loans, unless ▇▇▇▇▇ Fargo, has obtained a waiver of such requirements from
▇▇▇▇▇▇ ▇▇▇ or ▇▇▇▇▇▇▇ Mac. ▇▇▇▇▇ Fargo shall also maintain a fidelity bond in
the form and amount that would meet the requirements of ▇▇▇▇▇▇ Mae or ▇▇▇▇▇▇▇
Mac, unless ▇▇▇▇▇ Fargo, has obtained a waiver of such requirements from ▇▇▇▇▇▇
▇▇▇ or ▇▇▇▇▇▇▇ Mac. ▇▇▇▇▇ Fargo shall be deemed to have complied with this
provision if an Affiliate of such Servicer, has such errors and omissions and
fidelity bond coverage and, by the terms of such insurance policy or fidelity
bond, the coverage afforded thereunder extends to such Servicer. Any such errors
and omissions policy and fidelity bond shall by its terms not be cancelable
without thirty days' prior written notice to the Trustee.
(c) No Servicer shall take any action that would result in noncoverage
under any applicable primary mortgage insurance policy of any loss which, but
for the actions of such Servicer would have been covered thereunder. ▇▇▇▇▇ Fargo
shall use its best efforts to keep in force and effect any applicable primary
mortgage insurance policy and, to the extent that the related Mortgage Loan
requires the Mortgagor to maintain such insurance, any other primary mortgage
insurance applicable to any Mortgage Loan. Except as required by applicable law
or the related Mortgage Loan Documents, ▇▇▇▇▇ Fargo shall not cancel or refuse
to renew any such primary mortgage insurance policy that is in effect at the
date of the initial issuance of the related Mortgage Note and is required to be
kept in force hereunder.
▇▇▇▇▇ Fargo agrees to present on behalf of the Trustee and the
Certificateholders claims to the applicable insurer under any primary mortgage
insurance policies and, in this regard, to take such reasonable action as shall
be necessary to permit recovery under any primary mortgage insurance policies
respecting defaulted Mortgage Loans. Pursuant to Section 3.08, any amounts
collected by a Servicer under any primary mortgage insurance policies shall be
deposited in the related Collection Account, subject to withdrawal pursuant to
Section 3.09. Notwithstanding any provision to the contrary, no Servicer shall
have any responsibility with respect to a primary mortgage insurance policy
unless such Servicer has been made aware of such policy, as reflected on the
Mortgage Loan Schedule or otherwise and have been provided with adequate
information to administer such policy.
SECTION 3.12. Enforcement of Due-on-Sale Clauses; Assumption Agreements
▇▇▇▇▇ Fargo shall, to the extent it has knowledge of any conveyance of
any related Mortgaged Property by any related Mortgagor (whether by absolute
conveyance or by contract of sale, and whether or not the Mortgagor remains or
is to remain liable under the Mortgage Note and/or the Mortgage), exercise its
rights to accelerate the maturity of such Mortgage Loan under the "due-on-sale"
clause, if any, applicable thereto; provided, however, that no Servicer shall
exercise any such rights if prohibited by law from doing so. If a Servicer
reasonably believes that it is unable under applicable law to enforce such
"due-on-sale" clause, or if any of the other conditions set forth in the proviso
to the preceding sentence apply, such Servicer shall enter into an assumption
and modification agreement from or with the person to whom such property has
been conveyed or is proposed to be conveyed, pursuant to which such person
becomes liable under the Mortgage Note and, to the extent permitted by
applicable state law, the Mortgagor remains liable thereon. ▇▇▇▇▇ Fargo is also
authorized to enter into a substitution of liability agreement with such person,
pursuant to which the original Mortgagor is released from liability and such
person is substituted as the Mortgagor and becomes liable under the Mortgage
Note, provided that no such substitution shall be effective unless such person
satisfies the then current underwriting criteria of ▇▇▇▇▇ Fargo for mortgage
loans similar to the related Mortgage Loans. In connection with any assumption
or substitution, ▇▇▇▇▇ Fargo shall apply such underwriting standards and follow
such practices and procedures as shall be normal and usual in its general
mortgage servicing activities and as it applies to other mortgage loans owned
solely by it. No Servicer shall take or enter into any assumption and
modification agreement, however, unless (to the extent practicable in the
circumstances) it shall have received confirmation, in writing, of the continued
effectiveness of any applicable hazard insurance policy. Any fee collected by a
Servicer in respect of an assumption or substitution of liability agreement will
be retained by such Servicer as additional servicing compensation. In connection
with any such assumption, no material term of the Mortgage Note (including but
not limited to the related Mortgage Rate and the amount of the Monthly Payment)
may be amended or modified, except as otherwise required pursuant to the terms
thereof. ▇▇▇▇▇ Fargo shall notify the Trustee (or the applicable Custodian) that
any such substitution or assumption agreement has been completed by forwarding
to the Trustee (or the Custodian) the executed original of such substitution or
assumption agreement, which document shall be added to the related Mortgage File
and shall, for all purposes, be considered a part of such Mortgage File to the
same extent as all other documents and instruments constituting a part thereof.
Notwithstanding the foregoing paragraph or any other provision of this
Agreement, no Servicer shall be deemed to be in default, breach or any other
violation of its obligations hereunder by reason of any assumption of a Mortgage
Loan by operation of law or by the terms of the Mortgage Note or any assumption
which ▇▇▇▇▇ Fargo may be restricted by law from preventing, for any reason
whatever. For purposes of this Section 3.12, the term "assumption" is deemed to
also include a sale (of the Mortgaged Property) subject to the Mortgage that is
not accompanied by an assumption or substitution of liability agreement.
SECTION 3.13. Realization Upon Defaulted Mortgage Loans.
(a) ▇▇▇▇▇ Fargo shall use its best efforts, consistent with Accepted
Servicing Practices, to foreclose upon or otherwise comparably convert the
ownership of properties securing such of the Mortgage Loans as come into and
continue in default and as to which no satisfactory arrangements can be made for
collection of delinquent payments pursuant to Section 3.06. ▇▇▇▇▇ Fargo shall be
responsible for all costs and expenses incurred by it in any such proceedings;
provided, however, that such costs and expenses will be recoverable as Servicing
Advances by the Servicers as contemplated in Sections 3.09 and 3.21. The
foregoing is subject to the provision that, in any case in which a Mortgaged
Property shall have suffered damage from an Uninsured Cause, ▇▇▇▇▇ Fargo shall
not be required to expend its own funds toward the restoration of such property
unless it shall determine in its discretion that such restoration will increase
the proceeds of liquidation of the related Mortgage Loan after reimbursement to
itself for such expenses.
(b) Notwithstanding the foregoing provisions of this Section 3.13 or
any other provision of this Agreement, with respect to any Mortgage Loan as to
which ▇▇▇▇▇ Fargo has received actual notice of, or has actual knowledge of, the
presence of any toxic or hazardous substance on the related Mortgaged Property,
such Servicer shall not, on behalf of the Trust Fund, either (i) obtain title to
such Mortgaged Property as a result of or in lieu of foreclosure or otherwise,
or (ii) otherwise acquire possession of, or take any other action with respect
to, such Mortgaged Property, if, as a result of any such action, the Trust Fund,
the Trustee or the Certificateholders would be considered to hold title to, to
be a "mortgagee-in-possession" of, or to be an "owner" or "operator" of such
Mortgaged Property within the meaning of the Comprehensive Environmental
Response, Compensation and Liability Act of 1980, as amended from time to time,
or any comparable law, unless such Servicer has also previously determined,
based on its reasonable judgment and a prudent report prepared by an Independent
Person who regularly conducts environmental audits using customary industry
standards, that:
(1) such Mortgaged Property is in compliance with applicable
environmental laws or, if not, that it would be in the best
economic interest of the Trust Fund to take such actions as
are necessary to bring the Mortgaged Property into compliance
therewith; and
(2) there are no circumstances present at such Mortgaged
Property relating to the use, management or disposal of any
hazardous substances, hazardous materials, hazardous wastes or
petroleum-based materials for which investigation, testing,
monitoring, containment, clean-up or remediation could be
required under any federal, state or local law or regulation,
or that if any such materials are present for which such
action could be required, that it would be in the best
economic interest of the Trust Fund to take such actions with
respect to the affected Mortgaged Property.
The cost of the environmental audit report contemplated by this Section
3.13 shall be advanced by ▇▇▇▇▇ Fargo, subject to ▇▇▇▇▇ Fargo's right to be
reimbursed therefor from the related Collection Account as provided in Section
3.09(a)(ix), such right of reimbursement being prior to the rights of
Certificateholders to receive any amount in the related Collection Account
received in respect of the affected Mortgage Loan or other Mortgage Loans.
If ▇▇▇▇▇ Fargo determines, as described above, that it is in the best
economic interest of the Trust Fund to take such actions as are necessary to
bring any such Mortgaged Property into compliance with applicable environmental
laws, or to take such action with respect to the containment, clean-up or
remediation of hazardous substances, hazardous materials, hazardous wastes, or
petroleum-based materials affecting any such Mortgaged Property, then ▇▇▇▇▇
Fargo shall take such action as it deems to be in the best economic interest of
the Trust Fund. The cost of any such compliance, containment, cleanup or
remediation shall be advanced by ▇▇▇▇▇ Fargo, subject to ▇▇▇▇▇ Fargo's right to
be reimbursed therefor from the related Collection Account as provided in
Sections 3.09(a)(iii) or 3.09(a)(ix), such right of reimbursement being prior to
the rights of Certificateholders to receive any amount in the related Collection
Account received in respect of the affected Mortgage Loan or other Mortgage
Loans.
(c) ▇▇▇▇▇ Fargo shall have the right to purchase from REMIC I any
defaulted Mortgage Loan serviced by it that is 90 days or more delinquent, which
such Servicer determines in good faith will otherwise become subject to
foreclosure proceedings (evidence of such determination to be delivered in
writing to the Trustee, in form and substance satisfactory to such Servicer and
the Trustee prior to purchase), at a price equal to the Purchase Price. The
Purchase Price for any Mortgage Loan purchased hereunder shall be deposited in
the related Collection Account, and the Trustee, upon receipt of written
certification from ▇▇▇▇▇ Fargo of such deposit, shall release or cause to be
released to ▇▇▇▇▇ Fargo the related Mortgage File and the Trustee shall execute
and deliver such instruments of transfer or assignment, in each case without
recourse, representation or warranty, as ▇▇▇▇▇ Fargo shall furnish and as shall
be necessary to vest in ▇▇▇▇▇ Fargo title to any Mortgage Loan released pursuant
hereto.
(d) Proceeds received in connection with any Final Recovery
Determination, as well as any recovery resulting from a partial collection of
Insurance Proceeds or Liquidation Proceeds, in respect of any Mortgage Loan,
will be applied in the following order of priority: first, to reimburse ▇▇▇▇▇
Fargo for any related unreimbursed Servicing Advances and P&I Advances, pursuant
to Section 3.09(a)(ii) or (a)(iii); second, to accrued and unpaid interest on
the Mortgage Loan, to the date of the Final Recovery Determination, or to the
Due Date prior to the Distribution Date on which such amounts are to be
distributed if not in connection with a Final Recovery Determination; and third,
as a recovery of principal of the Mortgage Loan. If the amount of the recovery
so allocated to interest is less than the full amount of accrued and unpaid
interest due on such Mortgage Loan, the amount of such recovery will be
allocated by ▇▇▇▇▇ Fargo as follows: first, to unpaid Servicing Fees; and
second, to the balance of the interest then due and owing. The portion of the
recovery so allocated to unpaid Servicing Fees shall be reimbursed to ▇▇▇▇▇
Fargo pursuant to Section 3.09(a)(iii). The portion of the recovery allocated to
interest (net of unpaid Servicing Fees) and the portion of the recovery
allocated to principal of the Mortgage Loan shall be applied as follows: first,
to reimburse ▇▇▇▇▇ Fargo for any related unreimbursed Servicing or P&I Advances
in accordance with Section 3.09(a)(ii) and any other amounts reimbursable to
▇▇▇▇▇ Fargo pursuant to Section 3.09, and second, as part of the amounts to be
transferred to the Distribution Account in accordance with Section 3.08(b).
SECTION 3.14. Trustee to Cooperate; Release of Mortgage Files.
(a) Upon becoming aware of the payment in full of any Mortgage Loan, or
the receipt by ▇▇▇▇▇ Fargo of a notification that payment in full has been
escrowed in a manner customary for such purposes for payment to
Certificateholders on the next Distribution Date, ▇▇▇▇▇ Fargo will promptly
furnish to the applicable Custodian, on behalf of the Trustee, two copies of a
request for release substantially in the form attached to the respective
Custodial Agreement signed by a Servicing Officer or in a mutually agreeable
electronic format which will, in lieu of a signature on its face, originate from
a Servicing Officer (which certification shall include a statement to the effect
that all amounts received in connection with such payment that are required to
be deposited in the related Collection Account have been or will be so
deposited) and shall request that the applicable Custodian, on behalf of the
Trustee, deliver to ▇▇▇▇▇ Fargo the related Mortgage File. Upon receipt of such
certification and request, the applicable Custodian, on behalf of the Trustee,
shall within five (5) Business Days release the related Mortgage File to ▇▇▇▇▇
Fargo and the Trustee and the applicable Custodian shall have no further
responsibility with regard to such Mortgage File. Upon any such payment in full,
▇▇▇▇▇ Fargo is authorized, to give, as agent for the Trustee, as the mortgagee
under the Mortgage that secured the Mortgage Loan, an instrument of satisfaction
(or assignment of mortgage without recourse) regarding the Mortgaged Property
subject to the Mortgage, which instrument of satisfaction or assignment, as the
case may be, shall be delivered to the Person or Persons entitled thereto
against receipt therefor of such payment, it being understood and agreed that no
expenses incurred in connection with such instrument of satisfaction or
assignment, as the case may be, shall be chargeable to the related Collection
Account.
(b) From time to time and as appropriate for the servicing or
foreclosure of any Mortgage Loan, the Trustee shall execute such documents as
shall be prepared and furnished to the Trustee by ▇▇▇▇▇ Fargo (in form
reasonably acceptable to the Trustee) and as are necessary to the prosecution of
any such proceedings. The applicable Custodian, on behalf of the Trustee, shall,
upon the request of ▇▇▇▇▇ Fargo, and delivery to the applicable Custodian, on
behalf of the Trustee, of two copies of a request for release signed by a
Servicing Officer substantially in the form attached to the respective Custodial
Agreement (or in a mutually agreeable electronic format which will, in lieu of a
signature on its face, originate from a Servicing Officer), release within five
(5) Business Days the related Mortgage File held in its possession or control to
▇▇▇▇▇ Fargo. Such trust receipt shall obligate ▇▇▇▇▇ Fargo to return the
Mortgage File to the applicable Custodian on behalf of the Trustee, when the
need therefor by ▇▇▇▇▇ Fargo no longer exists unless the Mortgage Loan shall be
liquidated, in which case, upon receipt of a certificate of a Servicing Officer
similar to that hereinabove specified, the Mortgage File shall be released by
the applicable Custodian, on behalf of the Trustee, to ▇▇▇▇▇ Fargo.
Notwithstanding the foregoing, in connection with a Principal
Prepayment in full of any Mortgage Loan, the Master Servicer may request release
of the related Mortgage File from the applicable Custodian, in accordance with
the provisions of the respective Custodial Agreement, in the event ▇▇▇▇▇ Fargo
fails to do so.
Upon written certification of a Servicing Officer, the Trustee shall
execute and deliver to ▇▇▇▇▇ Fargo, any court pleadings, requests for trustee's
sale or other documents prepared and delivered to the Trustee and reasonably
acceptable to it and necessary to the foreclosure or trustee's sale in respect
of a Mortgaged Property or to any legal action brought to obtain judgment
against any Mortgagor on the Mortgage Note or Mortgage or to obtain a deficiency
judgment, or to enforce any other remedies or rights provided by the Mortgage
Note or Mortgage or otherwise available at law or in equity. Each such
certification shall include a request that such pleadings or documents be
executed by the Trustee and a statement as to the reason such documents or
pleadings are required and that the execution and delivery thereof by the
Trustee will not invalidate or otherwise affect the lien of the Mortgage, except
for the termination of such a lien upon completion of the foreclosure or
trustee's sale. So long as no Servicer Event of Default shall have occurred and
be continuing, ▇▇▇▇▇ Fargo shall have the right to execute any and all such
court pleadings, requests and other documents as attorney-in-fact for, and on
behalf of the Trustee. Notwithstanding the preceding sentence, the Trustee shall
in no way be liable or responsible for the willful malfeasance of a Servicer, or
for any wrongful or negligent actions taken by a Servicer, while such Servicer
is acting in its capacity as attorney in fact for and on behalf of the Trustee.
SECTION 3.15. Servicing Compensation.
As compensation for its activities hereunder, the Servicer shall be
entitled to the Servicing Fee with respect to each Mortgage Loan serviced by it
payable solely from payments of interest in respect of such Mortgage Loan,
subject to Section 3.22. In addition, ▇▇▇▇▇ Fargo shall be entitled to recover
unpaid Servicing Fees out of Insurance Proceeds or Liquidation Proceeds to the
extent permitted by Section 3.09(a)(iii) and out of amounts derived from the
operation and sale of an REO Property to the extent permitted by Section 3.21.
The right to receive the Servicing Fee may not be transferred in whole or in
part except in connection with the transfer of all of a Servicer's
responsibilities and obligations under this Agreement to the extent permitted
herein.
Additional servicing compensation in the form of assumption fees, late
payment charges, insufficient funds charges and other miscellaneous fees (other
than Prepayment Charges) and ancillary income shall be retained by ▇▇▇▇▇ Fargo
only to the extent such fees or charges are received by ▇▇▇▇▇ Fargo. ▇▇▇▇▇ Fargo
shall also be entitled pursuant to Section 3.09(a)(iv) to withdraw from the
related Collection Account and pursuant to Section 3.21(b) to withdraw from any
REO Account, as additional servicing compensation, interest or other income
earned on deposits therein, subject to Section 3.10. In addition, ▇▇▇▇▇ Fargo
shall be entitled to retain or withdraw from the related Collection Account,
pursuant to Section 3.09(a)(x), any Prepayment Interest Excess with respect to
the Mortgage Loans serviced by it as additional servicing compensation. ▇▇▇▇▇
Fargo shall be required to pay all expenses incurred by it in connection with
its servicing activities hereunder and shall not be entitled to reimbursement
therefor except as specifically provided herein.
SECTION 3.16. Collection Account Statements.
Upon request, not later than fifteen (15) days after each Distribution
Date, ▇▇▇▇▇ Fargo shall forward to the Master Servicer and the Securities
Administrator and the Master Servicer shall forward to the Trustee and the
Depositor upon request a statement prepared by the institution at which the
related Collection Account is maintained setting forth the status of the related
Collection Account as of the close of business on such Distribution Date and
showing, for the period covered by such statement, the aggregate amount of
deposits into and withdrawals from the related Collection Account of each
category of deposit specified in Section 3.08(a) and each category of withdrawal
specified in Section 3.09. Copies of such statement and any similar statements
provided by ▇▇▇▇▇ Fargo shall be provided by the Securities Administrator to any
Certificateholder and to any Person identified to the Securities Administrator
as a prospective transferee of a Certificate, upon request at the expense of the
requesting party, provided such statement is delivered by ▇▇▇▇▇ Fargo to the
Securities Administrator.
SECTION 3.17. Statement as to Compliance.
Not later than March 15th of each calendar year commencing in 2006,
▇▇▇▇▇ Fargo shall deliver to the Master Servicer (and the Master Servicer shall
provide copies to the Trustee and the Depositor upon request) an Officers'
Certificate in a form acceptable for filing with the Securities and Exchange
Commission as an exhibit to Form 10-K or other required form (upon which the
Master Servicer can conclusively rely in connection with its obligations under
Section 5.06) stating, as to each signatory thereof, that (i) a review of the
activities of such Servicer during the preceding year and of performance under
this Agreement has been made under such officers' supervision and (ii) to the
best of such officer's knowledge, based on such review, such Servicer has
fulfilled all of its obligations in all material respects under this Agreement
throughout such year, or, if there has been a default in the fulfillment of any
such material obligation, specifying each such default known to such officer and
the nature and status thereof. Copies of any such statement shall be provided by
the Trustee to any Certificateholder, upon request at the expense of the
requesting party, provided such statement is delivered by the Servicers to the
Trustee.
SECTION 3.18. Independent Public Accountants' Servicing Report.
Not later than March 15th of each calendar year commencing in 2006,
▇▇▇▇▇ Fargo, at its expense, shall cause a nationally recognized firm of
independent certified public accountants to furnish to such Servicer a report in
a form acceptable for filing with the Securities and Exchange Commission as an
exhibit to Form 10-K or other required form stating that (i) it has obtained a
letter of representation regarding certain matters from the management of such
Servicer which includes an assertion that such Servicer has complied with
certain minimum residential mortgage loan servicing standards, identified in the
Uniform Single Attestation Program for Mortgage Bankers established by the
Mortgage Bankers Association of America, with respect to the servicing of
residential mortgage loans during the most recently completed fiscal year and
(ii) on the basis of an examination conducted by such firm in accordance with
standards established by the American Institute of Certified Public Accountants,
such representation is fairly stated and such firm has determined that ▇▇▇▇▇
Fargo has complied in all material respects, subject to such exceptions and
other qualifications that may be appropriate. Immediately upon receipt of such
report, ▇▇▇▇▇ Fargo shall furnish a copy of such report to the Master Servicer,
and the Master Servicer shall furnish a copy of such report to the Trustee upon
request. Copies of such statement shall be provided by the Trustee to any
Certificateholder upon request at the expense of the requesting party, provided
that such statement is delivered by the Servicers to the Trustee.
SECTION 3.19. Annual Certification.
(a) ▇▇▇▇▇ Fargo shall deliver to the Master Servicer, on or before
March 15th of each calendar year beginning in 2006 (or, if any such day is not a
Business Day, the immediately preceding Business Day) or such alternative date
reasonably specified by the Master Servicer which shall occur not later than
fifteen (15) days prior to the date any Form 10-K is required to be filed with
the Commission in connection with the transactions contemplated by this
Agreement, a certification in the form attached hereto as Exhibit C. Such
certification shall be signed by the senior officer in charge of servicing of
▇▇▇▇▇ Fargo. In addition, ▇▇▇▇▇ Fargo shall provide such other information with
respect to the related Mortgage Loans and the servicing and administration
thereof within the control of such Servicer which shall be required to enable
the Master Servicer to comply with the reporting requirements of the Exchange
Act pursuant to Section 5.06 hereof.
(b) ▇▇▇▇▇ Fargo shall indemnify and hold harmless the Master Servicer,
the Securities Administrator, the Trustee, the Depositor and their respective
officers, directors, agents and affiliates from and against any losses, damages,
penalties, fines, forfeitures, reasonable legal fees and related costs,
judgments and other costs and expenses arising out of or based upon a breach by
such Servicer or any of its officers, directors, agents or affiliates of its
obligations under this Section 3.19 or such Servicer's negligence, bad faith or
willful misconduct in connection therewith. Such indemnity shall survive the
termination or resignation of the parties hereto or the termination of this
Agreement. If the indemnification provided for herein is unavailable or
insufficient to hold harmless the Master Servicer, the Securities Administrator,
the Trustee and the Depositor, then such Servicer agrees that it shall
contribute to the amount paid or payable by the Master Servicer, the Securities
Administrator, the Trustee and the Depositor as a result of the losses, claims,
damages or liabilities of the Master Servicer, the Securities Administrator, the
Trustee and the Depositor in such proportion as is appropriate to reflect the
relative fault of the Master Servicer, the Securities Administrator, the Trustee
and the Depositor on the one hand and such Servicer on the other in connection
with a breach of such Servicer's obligations under this Section 3.19.
SECTION 3.20. Access to Certain Documentation.
Each Servicer shall provide to the Office of Thrift Supervision, the
FDIC, and any other federal or state banking or insurance regulatory authority
that may exercise authority over any Certificate Owner, access to the
documentation regarding the related Mortgage Loans required by applicable laws
and regulations. Such access shall be afforded without charge, but only upon
reasonable request and during normal business hours at the offices of ▇▇▇▇▇
Fargo designated by it. Nothing in this Section 3.20 shall limit the obligation
of ▇▇▇▇▇ Fargo to comply with any applicable law prohibiting disclosure of
information regarding the Mortgagors and the failure of such Servicer to provide
access as provided in this Section as a result of such obligation shall not
constitute a breach of this Section. Nothing in this Section 3.20 shall require
any Servicer to collect, create, collate or otherwise generate any information
that it does not generate in its usual course of business. No Servicer shall be
required to make copies of or ship documents to any Person unless provisions
have been made for the reimbursement of the costs thereof.
SECTION 3.21. Title, Management and Disposition of REO Property.
(a) The deed or certificate of sale of any REO Property related to a
Mortgage Loan shall be taken in the name of the Trustee, or its nominee, on
behalf of the Trust Fund and for the benefit of the Certificateholders. ▇▇▇▇▇
Fargo, on behalf of REMIC I, shall either sell any REO Property by the close of
the third calendar year following the calendar year in which REMIC I acquires
ownership of such REO Property for purposes of Section 860(a)(8) of the Code or
request from the Internal Revenue Service, no later than sixty (60) days before
the day on which the three-year grace period would otherwise expire an extension
of the three-year grace period, unless ▇▇▇▇▇ Fargo had delivered to the Trustee
an Opinion of Counsel, addressed to the Trustee and the Depositor, to the effect
that the holding by REMIC I of such REO Property subsequent to three (3) years
after its acquisition will not result in the imposition on any Trust REMIC
created hereunder of taxes on "prohibited transactions" thereof, as defined in
Section 860F of the Code, or cause any Trust REMIC hereunder to fail to qualify
as a REMIC under Federal law at any time that any Certificates are outstanding.
▇▇▇▇▇ Fargo shall manage, conserve, protect and operate each REO Property for
the Certificateholders solely for the purpose of its prompt disposition and sale
in a manner which does not cause such REO Property to fail to qualify as
"foreclosure property" within the meaning of Section 860G(a)(8) of the Code or
result in the receipt by any Trust REMIC created hereunder of any "income from
non-permitted assets" within the meaning of Section 860F(a)(2)(B) of the Code,
or any "net income from foreclosure property" which is subject to taxation under
the REMIC Provisions.
(b) ▇▇▇▇▇ Fargo shall segregate and hold all funds collected and
received in connection with the operation of any REO Property separate and apart
from its own funds and general assets and shall establish and maintain with
respect to REO Properties an account held in trust for the Trustee, on behalf of
the Trust Fund and for the benefit of the Certificateholders (the "REO
Account"), which shall be an Eligible Account. ▇▇▇▇▇ Fargo shall be permitted to
allow the related Collection Account to serve as the REO Account, subject to the
maintenance of separate ledgers for each REO Property. ▇▇▇▇▇ Fargo shall be
entitled to retain or withdraw any interest income paid on funds deposited in
the related REO Account.
(c) ▇▇▇▇▇ Fargo shall have full power and authority, subject only to
the specific requirements and prohibitions of this Agreement, to do any and all
things in connection with any REO Property related to a Mortgage Loan serviced
by it as are consistent with the manner in which such Servicer manages and
operates similar property owned by it or any of its Affiliates, all on such
terms and for such period as such Servicer deems to be in the best interests of
Certificateholders. In connection therewith, ▇▇▇▇▇ Fargo shall deposit, or cause
to be deposited on a daily basis in the REO Account, all revenues received by it
with respect to an REO Property related to a Mortgage Loan serviced by it and
shall withdraw therefrom funds necessary for the proper operation, management
and maintenance of such REO Property including, without limitation:
(i) all insurance premiums due and payable in respect of such
REO Property;
(ii) all real estate taxes and assessments in respect of such
REO Property that may result in the imposition of a lien thereon; and
(iii) all costs and expenses necessary to maintain such REO
Property.
To the extent that amounts on deposit in the REO Account with respect
to an REO Property are insufficient for the purposes set forth in clauses (i)
through (iii) above with respect to such REO Property, ▇▇▇▇▇ Fargo shall advance
from its own funds such amount as is necessary for such purposes if, but only
if, ▇▇▇▇▇ Fargo would make such advances if ▇▇▇▇▇ Fargo owned the REO Property
and if in ▇▇▇▇▇ Fargo's judgment, the payment of such amounts will be
recoverable from the rental or sale of the REO Property.
Subject to compliance with applicable laws and regulations as shall at
any time be in force, and notwithstanding the foregoing, ▇▇▇▇▇ Fargo, on behalf
of the Trust Fund, shall not:
(iv) enter into, renew or extend any New Lease with respect to
any REO Property, if the New Lease by its terms will give rise to any
income that does not constitute Rents from Real Property;
(v) permit any amount to be received or accrued under any New
Lease other than amounts that will constitute Rents from Real Property;
(vi) authorize or permit any construction on any REO Property,
other than the completion of a building or other improvement thereon,
and then only if more than ten percent of the construction of such
building or other improvement was completed before default on the
related Mortgage Loan became imminent, all within the meaning of
Section 856(e)(4)(B) of the Code; or
(vii) allow any Person to Directly Operate any REO Property on
any date more than ninety (90) days after its date of acquisition by
the Trust Fund;
unless, in any such case, ▇▇▇▇▇ Fargo has obtained an Opinion of Counsel,
provided to ▇▇▇▇▇ Fargo and the Trustee, to the effect that such action will not
cause such REO Property to fail to qualify as "foreclosure property" within the
meaning of Section 860G(a)(8) of the Code at any time that it is held by REMIC
I, in which case ▇▇▇▇▇ Fargo may take such actions as are specified in such
Opinion of Counsel.
▇▇▇▇▇ Fargo may contract with any Independent Contractor for the
operation and management of any REO Property, provided that:
(viii) the terms and conditions of any such contract shall not
be inconsistent herewith;
(ix) any such contract shall require, or shall be administered
to require, that the Independent Contractor pay all costs and expenses
incurred in connection with the operation and management of such REO
Property, including those listed above and remit all related revenues
(net of such costs and expenses) to ▇▇▇▇▇ Fargo as soon as practicable,
but in no event later than thirty (30) days following the receipt
thereof by such Independent Contractor;
(x) none of the provisions of this Section 3.21(c) relating to
any such contract or to actions taken through any such Independent
Contractor shall be deemed to relieve ▇▇▇▇▇ Fargo of any of its duties
and obligations to the Trustee on behalf of the Trust Fund and for the
benefit of the Certificateholders with respect to the operation and
management of any such REO Property; and
(xi) ▇▇▇▇▇ Fargo shall be obligated with respect thereto to
the same extent as if it alone were performing all duties and
obligations in connection with the operation and management of such REO
Property.
▇▇▇▇▇ Fargo shall be entitled to enter into any agreement with any
Independent Contractor performing services for it related to its duties and
obligations hereunder for indemnification of ▇▇▇▇▇ Fargo by such Independent
Contractor, and nothing in this Agreement shall be deemed to limit or modify
such indemnification. ▇▇▇▇▇ Fargo shall be solely liable for all fees owed by it
to any such Independent Contractor, irrespective of whether ▇▇▇▇▇ Fargo's
compensation pursuant to Section 3.15 is sufficient to pay such fees. Any such
agreement shall include a provision that such agreement may be immediately
terminated by the Trustee (as successor Servicer) or any other successor
Servicer (including the Master Servicer) without fee, in the event ▇▇▇▇▇ Fargo
shall for any reason, no longer be the Servicer of the related Mortgage Loans
(including termination due to a Servicer Event of Default).
(d) In addition to the withdrawals permitted under Section 3.21(c),
▇▇▇▇▇ Fargo may from time to time make withdrawals from the REO Account for any
REO Property: (i) to pay itself unpaid Servicing Fees in respect of the related
Mortgage Loan; and (ii) to reimburse itself or any Sub-Servicer for unreimbursed
Servicing Advances and Advances made in respect of such REO Property or the
related Mortgage Loan. On the Servicer Remittance Date, ▇▇▇▇▇ Fargo shall
withdraw from each REO Account maintained by it and deposit into the
Distribution Account in accordance with Section 3.08(d)(ii), for distribution on
the related Distribution Date in accordance with Section 5.01, the income from
the related REO Property received during the prior calendar month, net of any
withdrawals made pursuant to Section 3.21(c) or this Section 3.21(d).
(e) Subject to the time constraints set forth in Section 3.21(a), each
REO Disposition shall be carried out by ▇▇▇▇▇ Fargo at such price and upon such
terms and conditions as ▇▇▇▇▇ Fargo shall deem necessary or advisable, as shall
be normal and usual in accordance with Accepted Servicing Practices.
(f) The proceeds from the REO Disposition, net of any amount required
by law to be remitted to the Mortgagor under the related Mortgage Loan and net
of any payment or reimbursement to ▇▇▇▇▇ Fargo as provided above, shall be
deposited in the Distribution Account in accordance with Section 3.08(d)(ii) on
the Servicer Remittance Date in the month following the receipt thereof for
distribution on the related Distribution Date in accordance with Section 5.01.
Any REO Disposition shall be for cash only (unless changes in the REMIC
Provisions made subsequent to the Startup Day allow a sale for other
consideration).
(g) ▇▇▇▇▇ Fargo shall file information returns (and shall provide a
certification of a Servicing Officer to the Master Servicer that such filings
have been made) with respect to the receipt of mortgage interest received in a
trade or business, reports of foreclosures and abandonments of any Mortgaged
Property and cancellation of indebtedness income with respect to any Mortgaged
Property as required by Sections 6050H, 6050J and 6050P of the Code,
respectively. Such reports shall be in form and substance sufficient to meet the
reporting requirements imposed by such Sections 6050H, 6050J and 6050P of the
Code.
SECTION 3.22. Obligations of the Servicers in Respect of Prepayment
Interest Shortfalls; Relief Act Interest Shortfalls.
▇▇▇▇▇ Fargo shall deliver to the Securities Administrator for deposit
into the Distribution Account on the Servicer Remittance Date from its own funds
an amount equal to the lesser of (i) the aggregate amount of the Prepayment
Interest Shortfalls attributable to prepayments in full on the related Mortgage
Loans for the related Distribution Date resulting solely from voluntary
Principal Prepayments received by ▇▇▇▇▇ Fargo during the related Prepayment
Period and (ii) the aggregate amount of the related Servicing Fees payable to
related Servicer on such Distribution Date with respect to the related Mortgage
Loans. No Servicer shall have the right to reimbursement for any amounts
remitted to the Securities Administrator in respect of this Section 3.22. No
Servicer shall be obligated to pay the amounts set forth in this Section 3.22
with respect to shortfalls resulting from the application of the Relief Act.
SECTION 3.23. Obligations of the Servicers in Respect of Mortgage Rates and
Monthly Payments.
In the event that a shortfall in any collection on or liability with
respect to any Mortgage Loan results from or is attributable to adjustments to
Mortgage Rates, Monthly Payments or Stated Principal Balances that were made by
a Servicer in a manner not consistent with the terms of the related Mortgage
Note and this Agreement, ▇▇▇▇▇ Fargo, upon discovery or receipt of notice
thereof, immediately shall deliver to the Securities Administrator for deposit
in the Distribution Account from its own funds the amount of any such shortfall
and shall indemnify and hold harmless the Trust Fund, the Trustee, the
Securities Administrator, the Master Servicer, the Depositor and any successor
servicer in respect of any such liability. Such indemnities shall survive the
termination or discharge of this Agreement. Notwithstanding the foregoing, this
Section 3.23 shall not limit the ability of the Servicer to seek recovery of any
such amounts from the related Mortgagor under the terms of the related Mortgage
Note and Mortgage, to the extent permitted by applicable law.
SECTION 3.24. Reserve Fund.
(a) No later than the Closing Date, the Securities Administrator shall
establish and maintain a separate, segregated trust account entitled, "Reserve
Fund, ▇▇▇▇▇ Fargo Bank, N.A., in trust for the registered holders of ACE
Securities Corp. Home Equity Loan Trust, Series 2005-HE7, Asset Backed
Pass-Through Certificates." On the Closing Date, the Depositor will deposit, or
cause to be deposited, into the Reserve Fund 1,000.
(b) On each Distribution Date, the Securities Administrator shall
deposit into the Reserve Fund the amounts described in Section 5.01(c)(8)(vi),
rather than distributing such amounts to the Class CE Certificateholders, and
Section 5.01(c)(8)(vii). On each such Distribution Date, the Securities
Administrator shall hold all such amounts for the benefit of the Holders of the
Class A Certificates and the Mezzanine Certificates and will distribute such
amounts to the Holders of the Class A Certificates and the Mezzanine
Certificates, in the amounts and priorities set forth in Section 5.01(a). If no
Net WAC Rate Carryover Amounts are payable on a Distribution Date, the
Securities Administrator shall deposit, into the Reserve Fund on behalf of the
Class CE Certificateholders, from amounts otherwise distributable to the Class
CE Certificateholders, an amount such that when added to other amounts already
on deposit in the Reserve Fund, the aggregate amount on deposit therein is equal
to 1,000.
(c) For federal and state income tax purposes, the Class CE
Certificateholders will be deemed to be the owners of the Reserve Fund and all
amounts deposited into the Reserve Fund (other than the initial deposit therein
of 1,000) shall be treated as amounts distributed by REMIC II to the Holders of
the Class CE Certificates. Upon the termination of the Trust Fund, or the
payment in full of the Class A Certificates and the Mezzanine Certificates, all
amounts remaining on deposit in the Reserve Fund will be released by the Trust
Fund and distributed to the Class CE Certificateholders or their designees. The
Reserve Fund will be part of the Trust Fund but not part of any REMIC and any
payments to the Holders of the Class A Certificates or the Mezzanine
Certificates of Net WAC Rate Carryover Amounts will not be payments with respect
to a "regular interest" in a REMIC within the meaning of Code Section
860(G)(a)(1).
(d) By accepting a Class CE Certificate, each Class CE
Certificateholder hereby agrees that the Securities Administrator will deposit
into the Reserve Fund the amounts described above on each Distribution Date
rather than distributing such amounts to the Class CE Certificateholders. By
accepting a Class CE Certificate, each Class CE Certificateholder further agrees
that its agreement to such action by the Securities Administrator is given for
good and valuable consideration, the receipt and sufficiency of which is
acknowledged by such acceptance.
(e) At the direction of the Holders of a majority in Percentage
Interest in the Class CE Certificates, the Securities Administrator shall direct
any depository institution maintaining the Reserve Fund to invest the funds in
such account in one or more Permitted Investments bearing interest or sold at a
discount, and maturing, unless payable on demand, (i) no later than the Business
Day immediately preceding the date on which such funds are required to be
withdrawn from such account pursuant to this Agreement, if a Person other than
the Securities Administrator or an Affiliate manages or advises such investment,
and (ii) no later than the date on which such funds are required to be withdrawn
from such account pursuant to this Agreement, if the Securities Administrator or
an Affiliate manages or advises such investment. All income and gain earned upon
such investment shall be deposited into the Reserve Fund. In no event shall the
Securities Administrator be liable for any investments made pursuant to this
clause (e). If the Holders of a majority in Percentage Interest in the Class CE
Certificates fail to provide investment instructions, funds on deposit in the
Reserve Fund shall be held uninvested by the Securities Administrator without
liability for interest or compensation.
(f) For federal tax return and information reporting, the right of the
Class A Certificateholders and the Mezzanine Certificateholders to receive
payments from the Reserve Fund in respect of any Net WAC Rate Carryover Amount
shall be assigned a value of 70,000 with respect to the Certificates covered by
the Swap Agreement.
SECTION 3.25. Advance Facility.
(a) Notwithstanding anything to the contrary contained herein, (i)
▇▇▇▇▇ Fargo is hereby authorized to enter into an advance facility ("Advance
Facility") but no more than two Advance Facilities without the prior written
consent of the Trustee, which consent shall not be unreasonably withheld, under
which (A) ▇▇▇▇▇ Fargo sells, assigns or pledges to an advancing person (an
"Advance Financing Person") its rights under this Agreement to be reimbursed for
any P&I Advances or Servicing Advances and/or (B) an Advance Financing Person
agrees to finance some or all P&I Advances or Servicing Advances required to be
made by ▇▇▇▇▇ Fargo pursuant to this Agreement and (ii) ▇▇▇▇▇ Fargo is hereby
authorized to assign its rights to the Servicing Fee (which rights shall
terminate upon the resignation, termination or removal of ▇▇▇▇▇ Fargo pursuant
to the terms of this Agreement); it being understood that neither the Trust Fund
nor any party hereto shall have a right or claim (including without limitation
any right of offset) to any amounts for reimbursement of P&I Advances or
Servicing Advances so assigned or to the portion of the Servicing Fee so
assigned. Subject to the provisions of the first sentence of this Section
3.25(a), no consent of the Depositor, Trustee, Master Servicer,
Certificateholders or any other party is required before a Servicer may enter
into an Advance Facility, but such Servicer shall provide notice to the
Depositor, Master Servicer and the Trustee of the existence of any such Advance
Facility promptly upon the consummation thereof stating (a) the identity of the
Advance Financing Person and (b) the identity of any Person ("Servicer's
Assignee") who has the right to receive amounts in reimbursement of previously
▇▇▇▇▇▇▇▇▇▇▇▇ ▇&▇ Advances or Servicing Advances. Notwithstanding the existence
of any Advance Facility under which an advancing person agrees to finance P&I
Advances and/or Servicing Advances on such Servicer's behalf, such Servicer
shall remain obligated pursuant to this Agreement to make P&I Advances and
Servicing Advances pursuant to and as required by this Agreement, and shall not
be relieved of such obligations by virtue of such Advance Facility.
(b) Reimbursement amounts ("Advance Reimbursement Amounts") shall
consist solely of amounts in respect of P&I Advances and/or Servicing Advances
made with respect to the related Mortgage Loans for which ▇▇▇▇▇ Fargo would be
permitted to reimburse itself in accordance with this Agreement, assuming ▇▇▇▇▇
Fargo had made the related P&I Advance(s) and/or Servicing Advance(s).
(c) ▇▇▇▇▇ Fargo shall maintain and provide to any successor Servicer
(with, upon request, a copy to the Trustee) a detailed accounting on a
loan-by-loan basis as to amounts advanced by, pledged or assigned to, and
reimbursed to any advancing person. The successor Servicer shall be entitled to
rely on any such information provided by the predecessor Servicer, and the
successor servicer shall not be liable for any errors in such information.
(d) Reimbursement amounts distributed with respect to each Mortgage
Loan shall be allocated to outstanding ▇▇▇▇▇▇▇▇▇▇▇▇ ▇&▇ Advances or Servicing
Advances (as the case may be) made with respect to that Mortgage Loan on a
"first-in, first out" (FIFO) basis. The documentation establishing any Advance
Facility shall require ▇▇▇▇▇ Fargo to provide to the related advancing person or
its designee loan-by-loan information with respect to each such reimbursement
amount distributed to such advancing person or Advance Facility trustee on each
Distribution Date, to enable the advancing person or Advance Facility trustee to
make the FIFO allocation of each such reimbursement amount with respect to each
Mortgage Loan. ▇▇▇▇▇ Fargo shall remain entitled to be reimbursed by the
advancing person or Advance Facility trustee for all P&I Advances and Servicing
Advances funded by ▇▇▇▇▇ Fargo to the extent the related rights to be reimbursed
therefor have not been sold, assigned or pledged to an advancing person.
(e) Any amendment to this Section 3.25 or to any other provision of
this Agreement that may be necessary or appropriate to effect the terms of an
Advance Facility as described generally in this Section 3.25, including
amendments to add provisions relating to a successor Servicer, may be entered
into by the Trustee, the Depositor, and ▇▇▇▇▇ Fargo without the consent of any
Certificateholder, notwithstanding anything to the contrary in this Agreement,
provided, that the Trustee has been provided an Opinion of Counsel that such
amendment is authorized hereunder and has no material adverse effect on the
Certificateholders, which opinion shall be an expense of the party requesting
such opinion but in any case shall not be an expense of the Trustee or the Trust
Fund; provided, further, that the amendment shall not be deemed to adversely
affect in any material respect the interests of the Certificateholders if the
Person requesting the amendment obtains a letter from each Rating Agency
(instead of obtaining an Opinion of Counsel to such effect) stating that the
amendment would not result in the downgrading or withdrawal of the respective
ratings then assigned to the Certificates; it being understood and agreed that
any such rating letter in and of itself will not represent a determination as to
the materiality of any such amendment and will represent a determination only as
to the credit issues affecting any such rating. Prior to entering into an
Advance Facility, ▇▇▇▇▇ Fargo shall notify the lender under such facility in
writing that: (a) the P&I Advances and/or Servicing Advances financed by and/or
pledged to the lender are obligations owed to ▇▇▇▇▇ Fargo on a non-recourse
basis payable only from the cash flows and proceeds received under this
Agreement for reimbursement of P&I Advances and/or Servicing Advances only to
the extent provided herein, and neither the Master Servicer, the Securities
Administrator, the Trustee nor the Trust are otherwise obligated or liable to
repay any P&I Advances and/or Servicing Advances financed by the lender; (b)
▇▇▇▇▇ Fargo will be responsible for remitting to the lender the applicable
amounts collected by it as Servicing Fees and as reimbursement for P&I Advances
and/or Servicing Advances funded by the lender, as applicable, subject to the
restrictions and priorities created in this Agreement; and (c) neither the
Master Servicer, the Securities Administrator nor the Trustee shall have any
responsibility to calculate any amount payable under an Advance Facility or to
track or monitor the administration of the financing arrangement between ▇▇▇▇▇
Fargo and the lender or the payment of any amount under an Advance Facility.
(f) ▇▇▇▇▇ Fargo shall indemnify the Master Servicer, the Securities
Administrator, the Trustee and the Trust Fund for any cost, liability or expense
relating to the Advance Facility including, without limitation, a claim, pending
or threatened, by an Advance Financing Person.
SECTION 3.26. The Servicers Indemnification.
▇▇▇▇▇ Fargo agrees to indemnify the Trustee, Master Servicer and the
Securities Administrator, from, and hold the Trustee, Master Servicer and the
Securities Administrator harmless against, any loss, liability or expense
(including reasonable attorney's fees and expenses) incurred by any such Person
by reason of such Servicer's willful misfeasance, bad faith or gross negligence
in the performance of its duties under this Agreement or by reason of such
Servicer's reckless disregard of its obligations and duties under this
Agreement. Such indemnity shall survive the termination or discharge of this
Agreement and the resignation or removal of related Servicer, the Trustee, the
Master Servicer and the Securities Administrator. Any payment hereunder made by
▇▇▇▇▇ Fargo to any such Person shall be from ▇▇▇▇▇ Fargo's own funds, without
reimbursement from REMIC I therefor.
ARTICLE IV
ADMINISTRATION AND MASTER SERVICING
OF THE MORTGAGE LOANS BY THE MASTER SERVICER
SECTION 4.01. Master Servicer.
The Master Servicer shall, from and after the Closing Date supervise,
monitor and oversee the obligations of ▇▇▇▇▇ Fargo under this Agreement and
Countrywide under the Servicing Agreement to service and administer the related
Mortgage Loans in accordance with the terms of this Agreement and the Servicing
Agreement ,as applicable, and shall have full power and authority to do any and
all things which it may deem necessary or desirable in connection with such
master servicing and administration. In performing its obligations hereunder,
the Master Servicer shall act in a manner consistent with Accepted Master
Servicing Practices. Furthermore, the Master Servicer shall oversee and consult
with the Servicers as necessary from time-to-time to carry out the Master
Servicer's obligations hereunder, shall receive, review and evaluate all
reports, information and other data provided to the Master Servicer by the
Servicers and shall cause the Servicers to perform and observe the covenants,
obligations and conditions to be performed or observed by the related Servicer
under this Agreement or the Servicing Agreement , as applicable. The Master
Servicer shall independently and separately monitor each Servicer's servicing
activities with respect to each related Mortgage Loan, reconcile the results of
such monitoring with such information provided in the previous sentence on a
monthly basis and coordinate corrective adjustments to each Servicer's and
Master Servicer's records, and based on such reconciled and corrected
information, prepare the statements specified in Section 5.03 and any other
information and statements required to be provided by the Master Servicer
hereunder. The Master Servicer shall reconcile the results of its Mortgage Loan
monitoring with the actual remittances of each Servicer to the Distribution
Account pursuant to the terms hereof based on information provided to the Master
Servicer by each Servicer.
The Trustee shall furnish the related Servicer and the Master Servicer
with any limited powers of attorney and other documents in form acceptable to it
necessary or appropriate to enable the related Servicer and the Master Servicer
to service and administer the related Mortgage Loans and REO Property. The
Trustee shall have no responsibility for any action of the Master Servicer or
the related Servicer pursuant to any such limited power of attorney and shall be
indemnified by the Master Servicer or the related Servicer, as applicable, for
any cost, liability or expense incurred by the Trustee in connection with such
Person's misuse of any such power of attorney.
The Trustee, the Custodians and the Securities Administrator shall
provide access to the records and documentation in possession of the Trustee,
the Custodians or the Securities Administrator regarding the related Mortgage
Loans and REO Property and the servicing thereof to the Certificateholders, the
FDIC, and the supervisory agents and examiners of the FDIC, such access being
afforded only upon reasonable prior written request and during normal business
hours at the office of the Trustee, the Custodians or the Securities
Administrator; provided, however, that, unless otherwise required by law, none
of the Trustee, the Custodians or the Securities Administrator shall be required
to provide access to such records and documentation if the provision thereof
would violate the legal right to privacy of any Mortgagor. The Trustee, the
Custodians and the Securities Administrator shall allow representatives of the
above entities to photocopy any of the records and documentation and shall
provide equipment for that purpose at a charge that covers the Trustee's, the
Custodians' or the Securities Administrator's actual costs.
The Trustee shall execute and deliver to the related Servicer or the
Master Servicer upon request any court pleadings, requests for trustee's sale or
other documents necessary or desirable to (i) the foreclosure or trustee's sale
with respect to a Mortgaged Property; (ii) any legal action brought to obtain
judgment against any Mortgagor on the Mortgage Note or any other Mortgage Loan
Document; (iii) obtain a deficiency judgment against the Mortgagor; or (iv)
enforce any other rights or remedies provided by the Mortgage Note or any other
Mortgage Loan Document or otherwise available at law or equity.
SECTION 4.02. REMIC-Related Covenants.
For as long as each REMIC shall exist, the Trustee and the Securities
Administrator shall act in accordance herewith to treat such REMIC as a REMIC,
and the Trustee and the Securities Administrator shall comply with any
directions of the Seller, the related Servicer or the Master Servicer to assure
such continuing treatment. In particular, the Trustee shall not (a) sell or
permit the sale of all or any portion of the Mortgage Loans or of any investment
of deposits in an Account unless such sale is as a result of a repurchase of the
Mortgage Loans pursuant to this Agreement or the Trustee has received a REMIC
Opinion prepared at the expense of the Trust Fund; and (b) other than with
respect to a substitution pursuant to the Mortgage Loan Purchase Agreement or
Section 2.03 of this Agreement, as applicable, accept any contribution to any
REMIC after the Startup Day without receipt of an Opinion of Counsel stating
that such contribution will not result in an Adverse REMIC Event as defined in
Section 11.01(f).
SECTION 4.03. Monitoring of Servicers.
(a) The Master Servicer shall be responsible for monitoring the
compliance by ▇▇▇▇▇ Fargo with their its duties under this Agreement and
Countrywide with its duties under the Servicing Agreement. In the review of the
related Servicer's activities, the Master Servicer may rely upon an Officer's
Certificate of the related Servicer with regard to such Servicer's compliance
with the terms of this Agreement or the Servicing Agreement, as applicable. In
the event that the Master Servicer, in its judgment, determines that the related
Servicer should be terminated in accordance with the terms hereof or the terms
of the Servicing Agreement, or that a notice should be sent pursuant to the
terms hereof with respect to the occurrence of an event that, unless cured,
would constitute a Servicer Event of Default or an event of default under the
Servicing Agreement, the Master Servicer shall notify the related Servicer, the
Seller and the Trustee thereof and (i) with respect to Countrywide the Master
Servicer shall issue such notice or take such other action as it deems
appropriate and (ii) with respect to ▇▇▇▇▇ Fargo, the Trustee shall issue such
notice or take such other action as it deems appropriate.
(b) The Master Servicer, for the benefit of the Trustee and the
Certificateholders, shall enforce the obligations of ▇▇▇▇▇ Fargo under this
Agreement and Countrywide under the Servicing Agreement and shall, in the event
that ▇▇▇▇▇ Fargo fails to perform its obligations in accordance with this
Agreement or Countrywide fails to perform its obligations in accordance with the
Servicing Agreement, subject to this Section and Article VIII, notify the
Trustee and the Trustee shall terminate the rights and obligations of such
Servicer hereunder in accordance with the provisions of Article VIII. In the
event the rights and obligations of Countrywide are terminated, the Master
Servicer shall act as servicer of the related Mortgage Loans or a successor
servicer shall be appointed in accordance with the provisions of Article VIII.
In the event that the rights and obligations of ▇▇▇▇▇ Fargo in its capacity as
Servicer of the ▇▇▇▇▇ Fargo Mortgage Loans are terminated, the Trustee shall act
as servicer of the related Mortgage Loans or a successor servicer shall be
appointed in accordance with the provisions of Article VIII Such enforcement,
including, without limitation, the legal prosecution of claims and the pursuit
of other appropriate remedies, shall be in such form and carried out to such an
extent and at such time as the Master Servicer, in its good faith business
judgment, would require were it the owner of the related Mortgage Loans. The
Master Servicer shall pay the costs of such enforcement at its own expense,
provided that the Master Servicer shall not be required to prosecute or defend
any legal action except to the extent that the Master Servicer shall have
received reasonable indemnity for its costs and expenses in pursuing such
action.
(c) The Master Servicer or the Trustee, as applicable shall be entitled
to be reimbursed by the related Servicer (or from amounts on deposit in the
Distribution Account if the related Servicer is unable to fulfill its
obligations hereunder or under the Servicing Agreement) for all reasonable
out-of-pocket or third party costs associated with the transfer of servicing
from the predecessor Servicer (or if the predecessor Servicer is the Master
Servicer, from the Servicer immediately preceding the Master Servicer),
including without limitation, any reasonable out-of-pocket or third party costs
or expenses associated with the complete transfer of all servicing data and the
completion, correction or manipulation of such servicing data as may be required
by the successor servicer to correct any errors or insufficiencies in the
servicing data or otherwise to enable the successor servicer to service the
related Mortgage Loans properly and effectively, upon presentation of reasonable
documentation of such costs and expenses.
(d) The Master Servicer shall require the Servicers to comply with the
remittance requirements and other obligations set forth in this Agreement and
the Servicing Agreement, as applicable.
(e) If the Master Servicer or the Trustee acts as successor to a
Servicer, it will not assume any liability for the representations and
warranties of the terminated Servicer.
SECTION 4.04. Fidelity Bond.
The Master Servicer, at its expense, shall maintain in effect a blanket
fidelity bond and an errors and omissions insurance policy, affording coverage
with respect to all directors, officers, employees and other Persons acting on
such Master Servicer's behalf, and covering errors and omissions in the
performance of the Master Servicer's obligations hereunder. The errors and
omissions insurance policy and the fidelity bond shall be in such form and
amount generally acceptable for entities serving as master servicers or
trustees.
SECTION 4.05. Power to Act; Procedures.
The Master Servicer shall master service the Mortgage Loans and shall
have full power and authority, subject to the REMIC Provisions and the
provisions of Article XI, to do any and all things that it may deem necessary or
desirable in connection with the master servicing and administration of the
Mortgage Loans, including but not limited to the power and authority (i) to
execute and deliver, on behalf of the Certificateholders and the Trustee,
customary consents or waivers and other instruments and documents, (ii) to
consent to transfers of any Mortgaged Property and assumptions of the Mortgage
Notes and related Mortgages, (iii) to collect any Insurance Proceeds and
Liquidation Proceeds, and (iv) to effectuate foreclosure or other conversion of
the ownership of the Mortgaged Property securing any Mortgage Loan, in each
case, in accordance with the provisions of this Agreement; provided, however,
that the Master Servicer shall not (and, consistent with its responsibilities
under Section 4.03, shall not permit the related Servicer to) knowingly or
intentionally take any action, or fail to take (or fail to cause to be taken)
any action reasonably within its control and the scope of duties more
specifically set forth herein, that, under the REMIC Provisions, if taken or not
taken, as the case may be, would cause REMIC I, REMIC II or REMIC III to fail to
qualify as a REMIC or result in the imposition of a tax upon the Trust Fund
(including but not limited to the tax on prohibited transactions as defined in
Section 860F(a)(2) of the Code and the tax on contributions to a REMIC set forth
in Section 860G(d) of the Code) unless the Master Servicer has received an
Opinion of Counsel (but not at the expense of the Master Servicer) to the effect
that the contemplated action will not cause REMIC I, REMIC II or REMIC III to
fail to qualify as a REMIC or result in the imposition of a tax upon REMIC I,
REMIC II or REMIC III, as the case may be. The Trustee shall furnish the Master
Servicer, upon written request from a Servicing Officer, with any powers of
attorney prepared and delivered to it and reasonably acceptable to it by
empowering the Master Servicer, the related Servicer to execute and deliver
instruments of satisfaction or cancellation, or of partial or full release or
discharge, and to foreclose upon or otherwise liquidate Mortgaged Property, and
to appeal, prosecute or defend in any court action relating to the Mortgage
Loans or the Mortgaged Property, in accordance with this Agreement or the
Servicing Agreement, and the Trustee shall execute and deliver such other
documents prepared and delivered to it and reasonably acceptable to it, as the
Master Servicer or the related Servicer may request, to enable the Master
Servicer to master service and administer the related Mortgage Loans and carry
out its duties hereunder, in each case in accordance with Accepted Master
Servicing Practices (and the Trustee shall have no liability for misuse of any
such powers of attorney by the Master Servicer or the related Servicer and shall
be indemnified by the Master Servicer or the related Servicer, as applicable,
for any cost, liability or expense incurred by the Trustee in connection with
such Person's use or misuse of any such power of attorney). If the Master
Servicer or the Trustee has been advised that it is likely that the laws of the
state in which action is to be taken prohibit such action if taken in the name
of the Trustee or that the Trustee would be adversely affected under the "doing
business" or tax laws of such state if such action is taken in its name, the
Master Servicer shall join with the Trustee in the appointment of a co-trustee
pursuant to Section 9.10. In the performance of its duties hereunder, the Master
Servicer shall be an independent contractor and shall not, except in those
instances where it is taking action in the name of the Trustee, be deemed to be
the agent of the Trustee.
SECTION 4.06. Due-on-Sale Clauses; Assumption Agreements.
To the extent Mortgage Loans contain enforceable due-on-sale clauses,
the Master Servicer shall cause the related Servicer to enforce such clauses in
accordance with this Agreement or the Servicing Agreement. If applicable law
prohibits the enforcement of a due-on-sale clause or such clause is otherwise
not enforced in accordance with this Agreement or the Servicing Agreement and,
as a consequence, a Mortgage Loan is assumed, the original Mortgagor may be
released from liability in accordance with this Agreement or the Servicing
Agreement.
SECTION 4.07. Documents, Records and Funds in Possession of Master
Servicer To Be Held for Trustee.
(a) The Master Servicer shall transmit to the Trustee or the applicable
Custodian such documents and instruments coming into the possession of the
Master Servicer from time to time as are required by the terms hereof to be
delivered to the Trustee or the applicable Custodian. Any funds received by the
Master Servicer in respect of any Mortgage Loan or which otherwise are collected
by the Master Servicer as Liquidation Proceeds or Insurance Proceeds in respect
of any Mortgage Loan shall be remitted to the Securities Administrator for
deposit in the Distribution Account. The Master Servicer shall, and, subject to
Section 3.20 of this Agreement or, to the extent provided therein, the Servicing
Agreement, shall cause the related Servicer to provide access to information and
documentation regarding the Mortgage Loans to the Trustee, its agents and
accountants at any time upon reasonable request and during normal business
hours, and to Certificateholders that are savings and loan associations, banks
or insurance companies, the Office of Thrift Supervision, the FDIC and the
supervisory agents and examiners of such Office and Corporation or examiners of
any other federal or state banking or insurance regulatory authority if so
required by applicable regulations of the Office of Thrift Supervision or other
regulatory authority, such access to be afforded without charge but only upon
reasonable request in writing and during normal business hours at the offices of
the Master Servicer designated by it. In fulfilling such a request the Master
Servicer shall not be responsible for determining the sufficiency of such
information.
(b) All Mortgage Files and funds collected or held by, or under the
control of, the Master Servicer, in respect of any Mortgage Loans, whether from
the collection of principal and interest payments or from Liquidation Proceeds
or Insurance Proceeds, shall be remitted to the Securities Administrator for
deposit in the Distribution Account.
SECTION 4.08. Standard Hazard Insurance and Flood Insurance Policies.
For each Mortgage Loan, the Master Servicer shall enforce the
obligation of ▇▇▇▇▇ Fargo under this Agreement and Countrywide under the
Servicing Agreement to maintain or cause to be maintained standard fire and
casualty insurance and, where applicable, flood insurance, all in accordance
with the provisions of this Agreement or the Servicing Agreement. It is
understood and agreed that such insurance shall be with insurers meeting the
eligibility requirements set forth in Section 3.11 of this Agreement or the
eligibility requirements set forth in the Servicing Agreement, as applicable,
and that no earthquake or other additional insurance is to be required of any
Mortgagor or to be maintained on property acquired in respect of a defaulted
loan, other than pursuant to such applicable laws and regulations as shall at
any time be in force and as shall require such additional insurance.
SECTION 4.09. Presentment of Claims and Collection of Proceeds.
The Master Servicer shall enforce each Servicer's obligations under
this Agreement or under the Servicing Agreement, as applicable, to prepare and
present on behalf of the Trustee and the Certificateholders all claims under any
insurance policies and take such actions (including the negotiation, settlement,
compromise or enforcement of the insured's claim) as shall be necessary to
realize recovery under such policies. Any proceeds disbursed to the Master
Servicer (or disbursed to the related Servicer and remitted to the Master
Servicer) in respect of such policies, bonds or contracts shall be promptly
deposited in the Distribution Account upon receipt, except that any amounts
realized that are to be applied to the repair or restoration of the related
Mortgaged Property as a condition precedent to the presentation of claims on the
related Mortgage Loan to the insurer under any applicable insurance policy need
not be so deposited or remitted.
SECTION 4.10. Maintenance of Primary Mortgage Insurance Policies.
(a) The Master Servicer shall not take, or permit a Servicer to take
(to the extent such action is prohibited by this Agreement or the Servicing
Agreement), any action that would result in noncoverage under any primary
mortgage insurance policy of any loss which, but for the actions of the Master
Servicer or the related Servicer, as applicable, would have been covered
thereunder. The Master Servicer shall use its best reasonable efforts to cause
the related Servicer to keep in force and effect (to the extent that the
Mortgage Loan requires the Mortgagor to maintain such insurance), primary
mortgage insurance applicable to each Mortgage Loan in accordance with the
provisions of this Agreement or the Servicing Agreement. The Master Servicer
shall not, and shall not permit the related Servicer to, cancel or refuse to
renew any primary mortgage insurance policy that is in effect at the date of the
initial issuance of the Mortgage Note and is required to be kept in force
hereunder except in accordance with the provisions of this Agreement or the
Servicing Agreement.
(b) The Master Servicer agrees to cause the related Servicer to
present, on behalf of the Trustee and the Certificateholders, claims to the
insurer under any primary mortgage insurance policies and, in this regard, to
take such reasonable action as shall be necessary to permit recovery under any
primary mortgage insurance policies respecting defaulted Mortgage Loans.
SECTION 4.11. Trustee to Retain Possession of Certain Insurance
Policies and Documents.
The Trustee or the applicable Custodian, shall retain possession and
custody of the originals (to the extent available) of any primary mortgage
insurance policies, or certificate of insurance if applicable, and any
certificates of renewal as to the foregoing as may be issued from time to time
as contemplated by this Agreement. Until all amounts distributable in respect of
the Certificates have been distributed in full and the Master Servicer and the
related Servicer have otherwise fulfilled their respective obligations under
this Agreement or the Servicing Agreement, as applicable, the Trustee or the
applicable Custodian shall also retain possession and custody of each Mortgage
File in accordance with and subject to the terms and conditions of this
Agreement and the related Custodial Agreement. The Master Servicer shall
promptly deliver or cause to be delivered to the Trustee or the applicable
Custodian, upon the execution or receipt thereof the originals of any primary
mortgage insurance policies, any certificates of renewal, and such other
documents or instruments that constitute Mortgage Loan Documents that come into
the possession of the Master Servicer from time to time.
SECTION 4.12. Reserved.
SECTION 4.13. Compensation for the Master Servicer.
As compensation for the activities of the Master Servicer hereunder,
the Master Servicer shall be entitled to the Master Servicing Fee and the income
from investment of or earnings on the funds from time to time in the
Distribution Account, as provided in Section 3.10. The compensation payable to
the Master Servicer in respect of any Distribution Date shall be reduced in
accordance with Section 4.18. The Master Servicer shall be required to pay all
expenses incurred by it in connection with its activities hereunder and shall
not be entitled to reimbursement therefor except as provided in this Agreement.
SECTION 4.14. REO Property.
(a) In the event the Trust Fund acquires ownership of any REO Property
in respect of any related Mortgage Loan, the deed or certificate of sale shall
be issued to the Trustee, or to its nominee, on behalf of the related
Certificateholders. The Master Servicer shall cause the related Servicer to
sell, any REO Property as expeditiously as possible and in accordance with the
provisions of this Agreement or the provisions of the Servicing Agreement, as
applicable. Further, the Master Servicer shall cause the related Servicer to
sell any REO Property prior to three years after the end of the calendar year of
its acquisition by REMIC I unless (i) the Trustee shall have been supplied by
the related Servicer with an Opinion of Counsel to the effect that the holding
by the Trust Fund of such REO Property subsequent to such three-year period will
not result in the imposition of taxes on "prohibited transactions" of any REMIC
hereunder as defined in section 860F of the Code or cause any REMIC hereunder to
fail to qualify as a REMIC at any time that any Certificates are outstanding, in
which case the Trust Fund may continue to hold such Mortgaged Property (subject
to any conditions contained in such Opinion of Counsel) or (ii) the related
Servicer shall have applied for, prior to the expiration of such three-year
period, an extension of such three-year period in the manner contemplated by
Section 856(e)(3) of the Code, in which case the three-year period shall be
extended by the applicable extension period. The Master Servicer shall cause the
related Servicer to protect and conserve, such REO Property in the manner and to
the extent required by this Agreement or the Servicing Agreement, as applicable,
in accordance with the REMIC Provisions and in a manner that does not result in
a tax on "net income from foreclosure property" or cause such REO Property to
fail to qualify as "foreclosure property" within the meaning of Section
860G(a)(8) of the Code.
(b) The Master Servicer shall cause the related Servicer to deposit all
funds collected and received in connection with the operation of any REO
Property in the REO Account or in the account designated for such amounts under
the Servicing Agreement.
SECTION 4.15. Annual Officer's Certificate as to Compliance.
(a) The Master Servicer shall deliver to the Trustee and the Rating
Agencies on or before March 15 of each year, commencing on March 15, 2006, an
Officer's Certificate signed by a Servicing Officer, certifying that with
respect to the period ending December 31 of the prior year: (i) such Servicing
Officer has reviewed the activities of such Master Servicer during the preceding
calendar year or portion thereof and its performance under this Agreement, (ii)
to the best of such Servicing Officer's knowledge, based on such review, such
Master Servicer has performed and fulfilled its duties, responsibilities and
obligations under this Agreement in all material respects throughout such year,
or, if there has been a default in the fulfillment of any such duties,
responsibilities or obligations, specifying each such default known to such
Servicing Officer and the nature and status thereof, (iii) nothing has come to
the attention of such Servicing Officer to lead such Servicing Officer to
believe that the Master Servicer has failed to perform any of its duties,
responsibilities and obligations under this Agreement in all material respects
throughout such year, or, if there has been a material default in the
performance or fulfillment of any such duties, responsibilities or obligations,
specifying each such default known to such Servicing Officer and the nature and
status thereof.
(b) Copies of such statements shall be provided to any
Certificateholder upon request, by the Master Servicer or by the Trustee at the
Master Servicer's expense if the Master Servicer failed to provide such copies
(unless (i) the Master Servicer shall have failed to provide the Trustee with
such statement or (ii) the Trustee shall be unaware of the Master Servicer's
failure to provide such statement).
SECTION 4.16. Annual Independent Accountant's Servicing Report.
If the Master Servicer has, during the course of any calendar year,
directly serviced any of the Mortgage Loans, then the Master Servicer at its
expense shall cause a nationally recognized firm of independent certified public
accountants to furnish a statement to the Trustee, the Rating Agencies and the
Seller on or before March 15 of each year, commencing on March 15, 2006 to the
effect that, with respect to the most recently ended fiscal year, such firm has
examined certain records and documents relating to the Master Servicer's
performance of its servicing obligations under this Agreement and pooling and
servicing and trust agreements in material respects similar to this Agreement
and to each other and that, on the basis of such examination conducted
substantially in compliance with the audit program for mortgages serviced for
▇▇▇▇▇▇▇ Mac or the Uniform Single Attestation Program for Mortgage Bankers, such
firm is of the opinion that the Master Servicer's activities have been conducted
in compliance with this Agreement, or that such examination has disclosed no
material items of noncompliance except for (i) such exceptions as such firm
believes to be immaterial, (ii) such other exceptions as are set forth in such
statement and (iii) such exceptions that the Uniform Single Attestation Program
for Mortgage Bankers or the Audit Program for Mortgages Serviced by ▇▇▇▇▇▇▇ Mac
requires it to report. Copies of such statements shall be provided to any
Certificateholder upon request by the Master Servicer, or by the Trustee at the
expense of the Master Servicer if the Master Servicer shall fail to provide such
copies (unless (i) the Master Servicer shall have failed to provide the Trustee
with such statement or (ii) the Trustee shall be unaware of the Master
Servicer's failure to provide such statement). If such report discloses
exceptions that are material, the Master Servicer shall advise the Trustee
whether such exceptions have been or are susceptible of cure, and will take
prompt action to do so.
SECTION 4.17. Reserved.
SECTION 4.18. Obligation of the Master Servicer in Respect of
Prepayment Interest Shortfalls.
In the event of any Prepayment Interest Shortfalls, the Master Servicer
shall deposit into the Distribution Account not later than the related
Distribution Date an amount equal to the lesser of (i) the aggregate amounts
required to be paid by the related Servicer with respect to Prepayment Interest
Shortfalls attributable to Principal Prepayments in full on the Mortgage Loans
for the related Distribution Date, and not so paid by the related Servicer and
(ii) the aggregate amount of the compensation payable to the Master Servicer for
such Distribution Date in accordance with Section 4.13, without reimbursement
therefor.
SECTION 4.19. Prepayment Penalty Verification.
On or prior to each Servicer Remittance Date, each Servicer shall
provide in an electronic format acceptable to the Master Servicer the data
necessary for the Master Servicer to perform its verification duties set forth
in this Section 4.19. The Master Servicer or a third party reasonably acceptable
to the Master Servicer and the Depositor (the "Verification Agent") will perform
such verification duties and will use its best efforts to issue its findings in
a report (the "Verification Report") delivered to the Master Servicer and the
Depositor within ten (10) Business Days following the related Distribution Date;
provided, however, that if the Verification Agent is unable to issue the
Verification Report within ten (10) Business Days following the Distribution
Date, the Verification Agent may issue and deliver to the Master Servicer and
the Depositor the Verification Report upon the completion of its verification
duties. The Master Servicer shall forward the Verification Report to the related
Servicer and shall notify the related Servicer if the Master Servicer has
determined that the related Servicer did not deliver the appropriate Prepayment
Charge to the Securities Administrator in accordance with this Agreement. Such
written notification from the Master Servicer shall include the loan number,
prepayment penalty code and prepayment penalty amount as calculated by the
Master Servicer or the Verification Agent, as applicable, of each Mortgage Loan
for which there is a discrepancy. If the related Servicer agrees with the
verified amounts, the related Servicer shall adjust the immediately succeeding
Servicer Report and the amount remitted to the Securities Administrator with
respect to prepayments accordingly. If the related Servicer disagrees with the
determination of the Master Servicer, the related Servicer shall, within five
(5) Business Days of its receipt of the Verification Report, notify the Master
Servicer of such disagreement and provide the Master Servicer with detailed
information to support its position. The related Servicer and the Master
Servicer shall cooperate to resolve any discrepancy on or prior to the
immediately succeeding Servicer Remittance Date, and the related Servicer will
indicate the effect of such resolution on the related Servicer Report and shall
adjust the amount remitted with respect to prepayments on such Servicer
Remittance Date accordingly.
During such time as the related Servicer and the Master Servicer are
resolving discrepancies with respect to the Prepayment Charges, no payments in
respect of any disputed Prepayment Charges will be remitted to the Securities
Administrator for deposit in the Distribution Account and the Master Servicer
shall not be obligated to deposit such payments, unless otherwise required
pursuant to Section 8.01 hereof. In connection with such duties, the Master
Servicer shall be able to rely solely on the information provided to it by the
related Servicer in accordance with this Section. The Master Servicer shall not
be responsible for verifying the accuracy of any of the information provided to
it by the related Servicer.
ARTICLE V
PAYMENTS TO CERTIFICATEHOLDERS
SECTION 5.01. Distributions.
On each Distribution Date, the following amounts, in the following
order of priority, shall be distributed by REMIC I to REMIC II on account of the
REMIC I Regular Interests and distributed to the holders of the Class R
Certificates (in respect of the Class R-I Interest), as the case may be:
(a) (1) With respect to the Group IA Mortgage Loans:
(i) to Holders of REMIC I Regular Interest A-I, and each of
REMIC I Regular Interest I-1-A through I-46-B, PRO RATA, in an amount
equal to (A) Uncertificated Interest for such REMIC I Regular Interests
for such Distribution Date, plus (B) any amounts payable in respect
thereof remaining unpaid from previous Distribution Dates;
(ii) to the extent of amounts remaining after the
distributions made pursuant to clause (i) above, to the Holders of
REMIC I Regular Interest A-I, an amount of principal shall be
distributed to such Holders until the Uncertificated Balance of REMIC I
Regular Interest A-I is reduced to zero; and
(iii) to the extent of amounts remaining after the
distributions made pursuant to clause (i) and (ii) above, payments of
principal shall be allocated to REMIC I Regular interests I-1-A through
I-46-B starting with the lowest numerical denomination until the
Uncertificated Balance of each such REMIC I Regular Interest is reduced
to zero, provided that, for REMIC I Regular Interests with the same
numerical denomination, such payments of principal shall be allocated
PRO RATA between such REMIC I Regular Interests.
(2) With respect to the Group IB Mortgage Loans:
(i) to Holders of REMIC I Regular Interest A-II, and each of
REMIC I Regular Interest II-1-A through II-46-B, PRO RATA, in an amount
equal to (A) Uncertificated Interest for such REMIC I Regular Interests
for such Distribution Date, plus (B) any amounts payable in respect
thereof remaining unpaid from previous Distribution Dates;
(ii) to the extent of amounts remaining after the
distributions made pursuant to clause (i) above, to the Holders of
REMIC I Regular Interest A-II, an amount of principal shall be
distributed to such Holders until the Uncertificated Balance of REMIC I
Regular Interest A-II is reduced to zero; and
(iii) to the extent of amounts remaining after the
distributions made pursuant to clause (i) and (ii) above, payments of
principal shall be allocated to REMIC I Regular interests II-1-A
through II-46-B starting with the lowest numerical denomination until
the Uncertificated Balance of each such REMIC I Regular Interest is
reduced to zero, provided that, for REMIC I Regular Interests with the
same numerical denomination, such payments of principal shall be
allocated PRO RATA between such REMIC I Regular Interests.
(3) With respect to the Group II Mortgage Loans:
(i) to Holders of REMIC I Regular Interest A-III and each of
REMIC I Regular Interest III-1-A through III-46-B, PRO RATA, in an
amount equal to (A) Uncertificated Interest for such REMIC I Regular
Interests for such Distribution Date, plus (B) any amounts payable in
respect thereof remaining unpaid from previous Distribution Dates.
(ii) to the extent of amounts remaining after the
distributions made pursuant to clause (i) above, to the Holders of
REMIC I Regular Interest A-III, an amount of principal shall be
distributed to such Holders until the Uncertificated Balance of REMIC I
Regular Interest A-III is reduced to zero; and
(iii) to the extent of amounts remaining after the
distributions made pursuant to clause (i) and (ii) above, payments of
principal shall be allocated to REMIC I Regular interests III-1-A
through III-46-B starting with the lowest numerical denomination until
the Uncertificated Balance of each such REMIC I Regular Interest is
reduced to zero, provided that, for REMIC I Regular Interests with the
same numerical denomination, such payments of principal shall be
allocated PRO RATA between such REMIC I Regular Interests.
(b) to the Holders of REMIC I Regular Interest P, (A) all amounts
representing Prepayment Charges in respect of the Mortgage Loans received during
the related Prepayment Period and (B) on the Distribution Date immediately
following the expiration of the latest Prepayment Charge as identified on the
Prepayment Charge Schedule or any Distribution Date thereafter until 100 has
been distributed pursuant to this clause.
(c) (1) On each Distribution Date, the following amounts, in the
following order of priority, shall be distributed by REMIC II to REMIC III on
account of the REMIC II Regular Interests or withdrawn from the Distribution
Account and distributed to the Holders of the Class R Certificates (in respect
of the Class R-II Interest), as the case may be:
(i) first to the Holders of REMIC II Regular Interest IO, in
an amount equal to (A) Uncertificated Interest for such REMIC II
Regular Interest for such Distribution Date, plus (B) any amounts in
respect thereof remaining unpaid from previous Distribution Dates and
second, to the Holders of REMIC II Regular Interest AA, REMIC II
Regular Interest A-1A, REMIC II Regular Interest A-1B1, REMIC II
Regular Interest A-1B2, REMIC II Regular Interest A-2A, REMIC II
Regular Interest A-2B, REMIC II Regular Interest A-2C, REMIC II Regular
Interest A-2D, REMIC II Regular Interest M-1, REMIC II Regular Interest
M-2, REMIC II Regular Interest M-3, REMIC II Regular Interest M-4,
REMIC II Regular Interest M-5, REMIC II Regular Interest M-6, REMIC II
Regular Interest M-7, REMIC II Regular Interest M-8, REMIC II Regular
Interest M-9, REMIC II Regular Interest M-10, REMIC II Regular Interest
M-11 and REMIC II Regular Interest ZZ, PRO RATA, in an amount equal to
(A) the Uncertificated Interest for such Distribution Date, plus (B)
any amounts in respect thereof remaining unpaid from previous
Distribution Dates. Amounts payable as Uncertificated Interest in
respect of REMIC II Regular Interest ZZ shall be reduced when the REMIC
II Overcollateralization Amount is less than the REMIC II Required
Overcollateralization Amount, by the lesser of (x) the amount of such
difference and (y) the Maximum ZZ Uncertificated Interest Deferral
Amount and such amount will be payable to the Holders of REMIC II
Regular Interest A-1A, REMIC II Regular Interest A-1B1, REMIC II
Regular Interest A-1B2, REMIC II Regular Interest A-2A, REMIC II
Regular Interest A-2B, REMIC II Regular Interest A-2C, REMIC II Regular
Interest A-2D, REMIC II Regular Interest M-1, REMIC II Regular Interest
M-2, REMIC II Regular Interest M-3, REMIC II Regular Interest M-4,
REMIC II Regular Interest M-5, REMIC II Regular Interest M-6, REMIC II
Regular Interest M-7, REMIC II Regular Interest M-8, REMIC II Regular
Interest M-9, REMIC II Regular Interest M-10 and REMIC II Regular
Interest M-11 in the same proportion as the Overcollateralization
Increase Amount is allocated to the Corresponding Certificates and the
Uncertificated Balance of REMIC II Regular Interest ZZ shall be
increased by such amount;
(ii) to Holders of REMIC II Regular Interest IA-SUB, REMIC II
Regular Interest IA-GRP, REMIC II Regular Interest IB-SUB, REMIC II
Regular Interest IB-GRP, REMIC II Regular Interest II-SUB, REMIC II
Regular Interest II-GRP, and REMIC II Regular Interest XX, PRO RATA, in
an amount equal to (A) the Uncertificated Interest for such
Distribution Date, plus (B) any amounts in respect thereof remaining
unpaid from previous Distribution Dates;
(iii) to the Holders of REMIC II Regular Interests, in an
amount equal to the remainder of the REMIC II Marker Allocation
Percentage of the available funds for such Distribution Date after the
distributions made pursuant to clause (i) above, allocated as follows:
(A) 98.00% of such remainder to the Holders of REMIC II
Regular Interest AA, until the Uncertificated Balance of such REMIC II
Regular Interest is reduced to zero;
(B) 2.00% of such remainder, first, to the Holders of REMIC II
Regular Interest A-1A, REMIC II Regular Interest A-1B1, REMIC II
Regular Interest A-1B2, REMIC II Regular Interest A-2A, REMIC II
Regular Interest A-2B, REMIC II Regular Interest A-2C, REMIC II Regular
Interest A-2D, REMIC II Regular Interest M-1, REMIC II Regular Interest
M-2, REMIC II Regular Interest M-3, REMIC II Regular Interest M-4,
REMIC II Regular Interest M-5, REMIC II Regular Interest M-6, REMIC II
Regular Interest M-7, REMIC II Regular Interest M-8, REMIC II Regular
Interest M-9, REMIC II Regular Interest M-10 and REMIC II Regular
Interest M-11, 1% of and in the same proportion as principal payments
are allocated to the Corresponding Certificates, until the
Uncertificated Balances of such REMIC II Regular Interests are reduced
to zero and second to the Holders of REMIC II Regular Interest ZZ,
until the Uncertificated Balance of such REMIC II Regular Interest is
reduced to zero;
(C) to the Holders of REMIC II Regular Interest P, 100% of the
amounts deemed distributed on REMIC I Regular Interest P; then
(D) any remaining amount to the Holders of the Class R
Certificate, in respect of the Class R-II Interest;
provided, however, that 98.00% and 2.00% of any principal payments that are
attributable to an Overcollateralization Reduction Amount shall be allocated to
Holders of REMIC II Regular Interest AA and REMIC II Regular Interest ZZ,
respectively.
(iv) to the Holders of REMIC II Regular Interests, in an
amount equal to the remainder of the REMIC II Sub WAC Allocation
Percentage of available funds for such Distribution Date after the
distributions made pursuant to clause (ii) above, such that
distributions of principal shall be deemed to be made to the REMIC II
Regular Interests first, so as to keep the Uncertificated Balance of
each REMIC II Regular Interest ending with the designation "GRP" equal
to 0.01% of the aggregate Stated Principal Balance of the Mortgage
Loans in the related loan group; second, to each REMIC II Regular
Interest ending with the designation "SUB," so that the Uncertificated
Balance of each such REMIC II Regular Interest is equal to 0.01% of the
excess of (x) the aggregate Stated Principal Balance of the Mortgage
Loans in the related loan group over (y) the current Certificate
Principal Balance of the Class A Certificate in the related loan group
(except that if any such excess is a larger number than in the
preceding distribution period, the least amount of principal shall be
distributed to such REMIC II Regular Interests such that the REMIC II
Subordinated Balance Ratio is maintained); and third, any remaining
principal to REMIC II Regular Interest XX.
(v) Notwithstanding the distributions described in Section
5.01(a)(1), distributions of funds shall be made to Certificateholders
only in accordance with Section 5.01(a)(2) through (8).
(2) On each Distribution Date, the Securities Administrator
shall withdraw from the Distribution Account to the extent on deposit
therein an amount equal to the Group IA Interest Remittance Amount and
make the following disbursements and transfers in the order of priority
described below, in each case to the extent of the Group IA Interest
Remittance Amount remaining for such Distribution Date:
FIRST, to the Supplemental Interest Trust, an amount equal to
the Group I Allocation Percentage of (i) any Net Swap Payment
owed to the Swap Provider and (ii) any Swap Termination
Payment owed to the Swap Provider not due to a Swap Provider
Trigger Event;
SECOND, to the Holders of the Class A-1A Certificates, the
Senior Interest Distribution Amount allocable to the Class
A-1A Certificates; and
THIRD, concurrently, to the Holders of the Class A-1B1, Class
A-1B2, Class A-2A, Class A-2B, Class A-2C and Class A-2D
Certificates, the Senior Interest Distribution Amount
allocable to each such Class, to the extent remaining unpaid
after the distribution of the Group IB Interest Remittance
Amount as set forth in Section 5.01(c)(3) below and the Group
II Interest Remittance Amount as set forth in Section
5.01(c)(4) below, on a pro rata basis, based on the
entitlement of each such Class.
(3) On each Distribution Date, the Securities Administrator
shall withdraw from the Distribution Account to the extent on deposit
therein an amount equal to the Group IB Interest Remittance Amount and
make the following disbursements and transfers in the order of priority
described below, in each case to the extent of the Group IB Interest
Remittance Amount remaining for such Distribution Date:
FIRST, to the Supplemental Interest Trust, an amount equal to
the Group IB Allocation Percentage of (i) any Net Swap Payment
owed to the Swap Provider and (ii) any Swap Termination
Payment owed to the Swap Provider not due to a Swap Provider
Trigger Event;
SECOND, to the Holders of the Class A-1B1 Certificates and
Class A-1B2 Certificates, the Senior Interest Distribution
Amount allocable to each such Class on a pro rata basis, based
on the entitlement of each such Class; and
THIRD, concurrently, to the Holders of the Class A-1A, Class
A-2A, Class A-2B, Class A-2C and Class A-2D Certificates, the
Senior Interest Distribution Amount allocable to each such
Class, to the extent remaining unpaid after the distribution
of the Group IA Interest Remittance Amount as set forth in
Section 5.01(c)(2) above and the Group II Interest Remittance
Amount as set forth in Section 5.01(c)(4) below, on a pro rata
basis, based on the entitlement of each such Class.
(4) On each Distribution Date, the Securities Administrator
shall withdraw from the Distribution Account to the extent on deposit
therein an amount equal to the Group II Interest Remittance Amount and
make the following disbursements and transfers in the order of priority
described below, in each case to the extent of the Group II Interest
Remittance Amount remaining for such Distribution Date:
FIRST, to the Supplemental Interest Trust, an amount equal to
the Group II Allocation Percentage of (i) any Net Swap Payment
owed to the Swap Provider and (ii) any Swap Termination
Payment owed to the Swap Provider not due to a Swap Provider
Trigger Event;
SECOND, concurrently, to the Holders of the Class A-2A, Class
A-2B, Class A-2C and Class A-2D Certificates, the Senior
Interest Distribution Amount allocable to each such Class, on
a pro rata basis, based on the entitlement of each such Class;
and
THIRD, concurrently, to the Holders of the Class A-1A, Class
A-1B1 and Class A-1B2 Certificates, the Senior Interest
Distribution Amount allocable to each such Class, to the
extent remaining unpaid after the distribution of the Group IA
Interest Remittance Amount as set forth in Section 5.01(c)(2)
above and the Group IB Interest Remittance Amount as set forth
in Section 5.01(c)(3) above, on a pro rata basis, based on the
entitlement of each such Class.
(5) On each Distribution Date, the Securities Administrator
shall withdraw from the Distribution Account to the extent on deposit
therein an amount equal to the Group IA Interest Remittance Amount,
Group IB Interest Remittance Amount and Group II Interest Remittance
Amount remaining after the distributions required by clauses (2), (3)
and (4) above and make the following disbursements and transfers in the
order of priority described below, in each case to the extent of the
Group IA Interest Remittance Amount, Group IB Interest Remittance
Amount and Group II Interest Remittance Amount remaining for such
Distribution Date:
sequentially, to the Holders of the Class M-1, Class M-2,
Class M-3, Class M-4, Class M-5, Class M-6, Class M-7, Class
M-8, Class M-9, Class M-10 and Class M-11 Certificates, in
that order, the Interest Distribution Amount allocable to each
such Class.
(6) On each Distribution Date (a) prior to the Stepdown Date
or (b) on which a Trigger Event is in effect, the Securities
Administrator shall withdraw from the Distribution Account to the
extent on deposit therein an amount equal to the Group IA Principal
Distribution Amount, Group IB Principal Distribution Amount and Group
II Principal Distribution Amount and distribute to the
Certificateholders the following amounts, in the following order of
priority:
(i) The Group IA Principal Distribution Amount shall be
distributed in the following order of priority:
FIRST, to the Supplemental Interest Trust, an amount equal to
the Group IA Allocation Percentage of (i) any Net Swap Payment
owed to the Swap Provider and (ii) any Swap Termination
Payment owed to the Swap Provider not due to a Swap Provider
Trigger Event to the extent not paid from the Interest
Remittance Amount on such Distribution Date;
SECOND, to the Holders of the Class A-1A Certificates, until
the Certificate Principal Balance of the Class A-1A
Certificates has been reduced to zero; and
THIRD, concurrently, (i) to the Holders of the Class A-1B1
Certificates and Class A-1B2 Certificates and (ii) to the
Holders of the Class A-2 Certificates, after taking into
account the distribution of the Group IB Principal
Distribution Amount as described in Section 5.01(c)(6)(ii)
below and the Group II Principal Distribution Amount as
described in Section 5.01(c)(6)(iii) below, on a pro rata
basis, based on the Certificate Principal Balance of each such
Class, until the Certificate Principal Balance of each such
Class has been reduced to zero; provided, however that if a
Sequential Trigger Event is in effect on such Distribution
Date, the pro rata allocation to the Class A-1B1 Certificates
and Class A-1B2 Certificates pursuant to this clause third
shall be based on the total Certificate Principal Balance of
the Class A-1B1 Certificates and Class A-1B2 Certificates, but
shall be distributed sequentially to the Class A-1B1
Certificates and Class A-1B2 Certificates, in that order,
until the Certificate Principal Balance of each such Class has
been reduced to zero; provided, further that the pro rata
allocation to the Class A-2 Certificates pursuant to this
clause third shall be based on the total Certificate Principal
Balance of the Class A-2 Certificates, but shall be
distributed sequentially to the Class A-2A, Class A-2B, Class
A-2C and Class A-2D Certificates, in that order, until the
Certificate Principal Balance of each such Class has been
reduced to zero.
(ii) The Group IB Principal Distribution Amount shall be
distributed in the following order of priority:
FIRST, to the Supplemental Interest Trust, an amount equal to
the Group IB Allocation Percentage of (i) any Net Swap Payment
owed to the Swap Provider and (ii) any Swap Termination
Payment owed to the Swap Provider not due to a Swap Provider
Trigger Event to the extent not paid from the Interest
Remittance Amount on such Distribution Date;
SECOND, concurrently to the Holders of the Class A-1B1
Certificates and Class A-1B2 Certificates, on a pro rata basis
based on the Certificate Principal Balance of each such Class,
until the Certificate Principal Balance of each such Class has
been reduced to zero; provided, however that if a Sequential
Trigger Event is in effect on such Distribution Date, the
distribution to the holders of the Class A-1B1 Certificates
and Class A-1B2 Certificates pursuant to this clause second
shall be made on a sequential basis to the Class A-1B1
Certificates and Class A-1B2 Certificates, in that order,
until the Certificate Principal Balance of each such Class has
been reduced to zero; and
THIRD, concurrently, (i) to the Holders of the Class A-1A
Certificates and (ii) to the Holders of the Class A-2
Certificates, after taking into account the distribution of
the Group IA Principal Distribution Amount as described in
Section 5.01(c)(6)(i) above and the Group II Principal
Distribution Amount as described in Section 5.01(c)(6)(iii)
below, on a pro rata basis, based on the Certificate Principal
Balance of each such Class, until the Certificate Principal
Balance of each such Class has been reduced to zero; provided,
however that the pro rata allocation to the Class A-2
Certificates pursuant to this clause third shall be based on
the total Certificate Principal Balance of the Class A-2
Certificates, but shall be distributed sequentially to the
Class A-2A, Class A-2B, Class A-2C and Class A-2D
Certificates, in that order, until the Certificate Principal
Balance of each such Class has been reduced to zero.
(iii) The Group II Principal Distribution Amount shall be
distributed in the following order of priority:
FIRST, to the Supplemental Interest Trust, an amount equal to
the Group II Allocation Percentage of (i) any Net Swap Payment
owed to the Swap Provider and (ii) any Swap Termination
Payment owed to the Swap Provider not due to a Swap Provider
Trigger Event to the extent not paid from the Interest
Remittance Amount on such Distribution Date;
SECOND, sequentially, to the Holders of the Class A-2A Class
A-2B, Class A-2C and Class A-2D Certificates, in that order,
until the Certificate Principal Balance of each such Class has
been reduced to zero; and
THIRD, concurrently, (i) to the Holders of the Class A-1A
Certificates and (ii) to the Holders of the Class A-1B1
Certificates and Class A-1B2 Certificates after taking into
account the distribution of the Group IA Principal
Distribution Amount as described in Section 5.01(c)(6)(i)
above and the Group IB Principal Distribution Amount as
described in Section 5.01(c)(6)(ii) above, on a pro rata basis
based on the Certificate Principal Balance of each such Class,
until the Certificate Principal Balance of each such Class has
been reduced to zero; provided, however that if a Sequential
Trigger Event is in effect on such Distribution Date, the pro
rata allocation to the Class A-1B1 Certificates and Class
A-1B2 Certificates pursuant to this clause third shall be
based on the total Certificate Principal Balance of the Class
A-1B1 Certificates and Class A-1B2 Certificates, but shall be
distributed sequentially to the Class A-1B1 Certificates and
Class A-1B2 Certificates, in that order, until the Certificate
Principal Balance of each such Class has been reduced to zero.
(iv) The Group IA Principal Distribution Amount, Group IB
Principal Distribution Amount and Group II Principal Distribution
Amount remaining after distributions pursuant to Sections
5.01(c)(6)(i), (ii) and (iii) above shall be distributed in the
following order of priority:
sequentially, to the Holders of the Class M-1, Class M-2,
Class M-3, Class M-4, Class M-5, Class M-6, Class M-7, Class
M-8, Class M-9, Class M-10 and Class M-11 Certificates, in
that order, until the Certificate Principal Balance of each
such Class has been reduced to zero.
(7) On each Distribution Date (a) on or after the Stepdown
Date and (b) on which a Trigger Event is not in effect, the Securities
Administrator shall withdraw from the Distribution Account to the
extent on deposit therein an amount equal to the Group IA Principal
Distribution Amount, Group IB Principal Distribution Amount and Group
II Principal Distribution Amount and distribute to the
Certificateholders the following amounts, in the following order of
priority:
(i) The Group IA Principal Distribution Amount shall be
distributed in the following order of priority:
FIRST, to the Supplemental Interest Trust, an amount equal to
the Group IA Allocation Percentage of (i) any Net Swap Payment
owed to the Swap Provider and (ii) any Swap Termination
Payment owed to the Swap Provider not due to a Swap Provider
Trigger Event to the extent not paid from the Interest
Remittance Amount on such Distribution Date;
SECOND, to the Holders of the Class A-1A Certificates, the
Class A-1A Principal Distribution Amount, until the
Certificate Principal Balance of such Class has been reduced
to zero; and
THIRD, concurrently, (i) to the holders of the Class A-1B1
Certificates and Class A-1B2 Certificates and (ii) to the
holders of the Class A-2 Certificates, after taking into
account the distribution of the Group IB Principal
Distribution Amount on such Distribution Date pursuant to
Section 5.01(c)(7)(ii) below and the Group II Principal
Distribution Amount pursuant to Section 5.01(c)(7)(iii) below
on such Distribution Date, on a pro rata basis based on the
amount required to satisfy the Targeted Credit Enhancement
Test with respect to Class A-1B1 Certificates and Class A-1B2
Certificates on the one hand and the Class A-2 Certificates on
the other; provided, however that if a Sequential Trigger
Event is in effect on such Distribution Date, the distribution
to the Class A-1B1 Certificates and Class A-1B2 Certificates
pursuant to this clause third shall be made on a sequential
basis to the Class A-1B1 Certificates and Class A-1B2
Certificates, in that order; provided, further that the
distribution to the Class A-2 Certificates pursuant to this
clause third shall be made on a sequential basis to the Class
A-2A, Class A-2B, Class A-2C and Class A-2D Certificates, in
that order.
(ii) The Group IB Principal Distribution Amount shall be
distributed in the following order of priority:
FIRST, to the Supplemental Interest Trust, an amount equal to
the Group IB Allocation Percentage of (i) any Net Swap Payment
owed to the Swap Provider and (ii) any Swap Termination
Payment owed to the Swap Provider not due to a Swap Provider
Trigger Event to the extent not paid from the Interest
Remittance Amount on such Distribution Date;
SECOND, concurrently to the Holders of the Class A-1B1
Certificates and Class A-1B2 Certificates, on a pro rata basis
based on the Certificate Principal Balance of each such Class,
the Class A-1B Principal Distribution Amount until the
Certificate Principal Balance of each such Class has been
reduced to zero; provided, however that if a Sequential
Trigger Event is in effect on such Distribution Date, the
distribution to the Holders of the Class A-1B1 Certificates
and Class A-1B2 Certificates pursuant to this clause second
shall be made on a sequential basis to the Class A-1B1
Certificates and Class A-1B2 Certificates, in that order,
until the Certificate Principal Balance of each such Class has
been reduced to zero; and
THIRD, concurrently, (i) to the holders of the Class A-1A
Certificates and (ii) to the holders of the Class A-2
Certificates, after taking into account the distribution of
the Group IA Principal Distribution Amount on such
Distribution Date pursuant to Section 5.01(c)(7)(i) above and
the Group II Principal Distribution Amount on such
Distribution Date the Group II Principal Distribution Amount
pursuant to Section 5.01(c)(7)(iii) below, on a pro rata basis
based on the amount required to satisfy the Targeted Credit
Enhancement Test with respect to Class A-1A Certificates on
the one hand and the Class A-2 Certificates on the other;
provided, however that the distribution to the Class A-2
Certificates pursuant to this clause third shall be based on a
sequential basis to the Class A-2A, Class A-2B, Class A-2C and
Class A-2D Certificates, in that order.
(iii) The Group II Principal Distribution Amount shall be
distributed in the following order of priority:
FIRST, to the Supplemental Interest Trust, an amount equal to
the Group II Allocation Percentage of (i) any Net Swap Payment
owed to the Swap Provider and (ii) any Swap Termination
Payment owed to the Swap Provider not due to a Swap Provider
Trigger Event to the extent not paid from the Interest
Remittance Amount on such Distribution Date;
SECOND, sequentially, to the Holders of the Class A-2A, Class
A-2B, Class A-2C and Class A-2D Certificates, in that order,
the Class A-2 Principal Distribution Amount, until the
Certificate Principal Balance of each such Class has been
reduced to zero; and
THIRD, concurrently, (i) to the holders of the Class A-1A
Certificates and (ii) to the holders of the Class A-1B1
Certificates and Class A-1B2 Certificates, after taking into
account the distribution of the Group IA Principal
Distribution Amount on such Distribution Date pursuant to
Section 5.01(c)(7)(i) above and the Group IB Principal
Distribution Amount on such Distribution Date pursuant to
Section 5.01(c)(7)(ii) above, on a pro rata basis based on the
amount required to satisfy the Target Credit Enhancement Test
with respect to the A-1A Certificates on the one hand and the
Class A-1B1 Certificates and Class A-1B2 Certificates on the
other; provided, however that if a Sequential Trigger Event is
in effect on such Distribution Date, the distribution to the
Class A-1B1 Certificates and Class A-1B2 Certificates pursuant
to this clause third shall be made on a sequential basis to
the Class A-1B1 Certificates and Class A-1B2 Certificates, in
that order.
(iv) The Principal Distribution Amount remaining after
distributions pursuant to Sections 5.01(c)(7)(i), (ii) and (iii) above
shall be distributed in the following order of priority:
FIRST, to the Holders of the Class M-1 Certificates, the
lesser of (x) the remaining Principal Distribution Amount and
(y) the Class M-1 Principal Distribution Amount, until the
Certificate Principal Balance of the Class M-1 Certificates
has been reduced to zero;
SECOND, to the Holders of the Class M-2 Certificates, the
lesser of (x) the excess of (i) the remaining Principal
Distribution Amount over (ii) the amounts distributed to the
Holders of the Class M-1 Certificates under clause first
above, and (y) the Class M-2 Principal Distribution Amount,
until the Certificate Principal Balance of the Class M-2
Certificates has been reduced to zero;
THIRD, to the Holders of the Class M-3 Certificates, the
lesser of (x) the excess of (i) the remaining Principal
Distribution Amount over (ii) the sum of the amounts
distributed to the Holders of the Class M-1 Certificates under
clause first above and to the Holders of the Class M-2
Certificates under clause second above, and (y) the Class M-3
Principal Distribution Amount, until the Certificate Principal
Balance of the Class M-3 Certificates has been reduced to
zero;
FOURTH, to the Holders of the Class M-4 Certificates, the
lesser of (x) the excess of (i) the remaining Principal
Distribution Amount over (ii) the sum of the amounts
distributed to the Holders of the Class M-1 Certificates under
clause first above, to the Holders of the Class M-2
Certificates under clause second above and to the Holders of
the Class M-3 Certificates under clause third above, and (y)
the Class M-4 Principal Distribution Amount, until the
Certificate Principal Balance of the Class M-4 Certificates
has been reduced to zero;
FIFTH, to the Holders of the Class M-5 Certificates, the
lesser of (x) the excess of (i) the remaining Principal
Distribution Amount over (ii) the sum of the amounts
distributed to the Holders of the Class M-1 Certificates under
clause first above, to the Holders of the Class M-2
Certificates under clause second above, to the Holders of the
Class M-3 Certificates under clause third above and to the
Holders of the Class M-4 Certificates under clause fourth
above, and (y) the Class M-5 Principal Distribution Amount,
until the Certificate Principal Balance of the Class M-5
Certificates has been reduced to zero;
SIXTH, to the Holders of the Class M-6 Certificates, the
lesser of (x) the excess of (i) the remaining Principal
Distribution Amount over (ii) the sum of the amounts
distributed to the Holders of the Class M-1 Certificates under
clause first above, to the Holders of the Class M-2
Certificates under clause second above, to the Holders of the
Class M-3 Certificates under clause third above, to the
Holders of the Class M-4 Certificates under clause fourth
above and to the Holders of the Class M-5 Certificates under
clause fifth above, and (y) the Class M-6 Principal
Distribution Amount, until the Certificate Principal Balance
of the Class M-6 Certificates has been reduced to zero;
SEVENTH, to the Holders of the Class M-7 Certificates, the
lesser of (x) the excess of (i) the remaining Principal
Distribution Amount over (ii) the sum of the amounts
distributed to the Holders of the Class M-1 Certificates under
clause first above, to the Holders of the Class M-2
Certificates under clause second above, to the Holders of the
Class M-3 Certificates under clause third above, to the
Holders of the Class M-4 Certificates under clause fourth
above, to the Holders of the Class M-5 Certificates under
clause fifth above and to the Holders of the Class M-6
Certificates under clause sixth above, and (y) the Class M-7
Principal Distribution Amount, until the Certificate Principal
Balance of the Class M-7 Certificates has been reduced to
zero;
EIGHTH, to the Holders of the Class M-8 Certificates, the
lesser of (x) the excess of (i) the remaining Principal
Distribution Amount over (ii) the sum of the amounts
distributed to the Holders of the Class M-1 Certificates under
clause first above, to the Holders of the Class M-2
Certificates under clause second above, to the Holders of the
Class M-3 Certificates under clause third above, to the
Holders of the Class M-4 Certificates under clause fourth
above, to the Holders of the Class M-5 Certificates under
clause fifth above, to the Holders of the Class M-6
Certificates under clause sixth above and to the Holders of
the Class M-7 Certificates under clause seventh above, and (y)
the Class M-8 Principal Distribution Amount, until the
Certificate Principal Balance of the Class M-8 Certificates
has been reduced to zero;
NINTH, to the Holders of the Class M-9 Certificates, the
lesser of (x) the excess of (i) the remaining Principal
Distribution Amount over (ii) the sum of the amounts
distributed to the Holders of the Class M-1 Certificates under
clause first above, to the Holders of the Class M-2
Certificates under clause second above, to the Holders of the
Class M-3 Certificates under clause third above, to the
Holders of the Class M-4 Certificates under clause fourth
above, to the Holders of the Class M-5 Certificates under
clause fifth above, to the Holders of the Class M-6
Certificates under clause sixth above, to the Holders of the
Class M-7 Certificates under clause seventh above and to the
Holders of the Class M-8 Certificates under clause eighth
above, and (y) the Class M-9 Principal Distribution Amount,
until the Certificate Principal Balance of the Class M-9
Certificates has been reduced to zero;
TENTH, to the Holders of the Class M-10 Certificates, the
lesser of (x) the excess of (i) the remaining Principal
Distribution Amount over (ii) the sum of the amounts
distributed to the Holders of the Class M-1 Certificates under
clause first above, to the Holders of the Class M-2
Certificates under clause second above, to the Holders of the
Class M-3 Certificates under clause third above, to the
Holders of the Class M-4 Certificates under clause fourth
above, to the Holders of the Class M-5 Certificates under
clause fifth above, to the Holders of the Class M-6
Certificates under clause sixth above, to the Holders of the
Class M-7 Certificates under clause seventh above, to the
Holders of the Class M-8 Certificates under clause eighth
above and to the Holders of the Class M-9 Certificates under
clause ninth above, and (y) the Class M-10 Principal
Distribution Amount, until the Certificate Principal Balance
of the Class M-10 Certificates has been reduced to zero; and
ELEVENTH, to the Holders of the Class M-11 Certificates, the
lesser of (x) the excess of (i) the remaining Principal
Distribution Amount over (ii) the sum of the amounts
distributed to the Holders of the Class M-1 Certificates under
clause first above, to the Holders of the Class M-2
Certificates under clause second above, to the Holders of the
Class M-3 Certificates under clause third above, to the
Holders of the Class M-4 Certificates under clause fourth
above, to the Holders of the Class M-5 Certificates under
clause fifth above, to the Holders of the Class M-6
Certificates under clause sixth above, to the Holders of the
Class M-7 Certificates under clause seventh above, to the
Holders of the Class M-8 Certificates under clause eighth
above, to the Holders of the Class M-9 Certificates under
clause ninth above and to the Holders of the Class M-10
Certificates under clause tenth above, and (y) the Class M-11
Principal Distribution Amount, until the Certificate Principal
Balance of the Class M-11 Certificates has been reduced to
zero;
(8) On each Distribution Date, the Net Monthly Excess Cashflow
(or, in the case of clause (i) below, the Net Monthly Excess Cashflow
exclusive of any Overcollateralization Reduction Amount) shall be
distributed as follows:
(i) to the Holders of the Class or Classes of Certificates
then entitled to receive distributions in respect of principal, in an
amount equal to any Extra Principal Distribution Amount, payable to
such Holders in accordance with the priorities set forth in Section
5.01(d) below;
(ii) sequentially, to the Holders of the Class M-1, Class M-2,
Class M-3, Class M-4, Class M-5, Class M-6, Class M-7, Class M-8, Class
M-9, Class M-10 and Class M-11 Certificates, in that order, in an
amount equal to the Interest Carry Forward Amount allocable to each
such Class;
(iii) sequentially, to the Holders of the Class M-1, Class
M-2, Class M-3, Class M-4, Class M-5, Class M-6, Class M-7, Class M-8,
Class M-9, Class M-10 and Class M-11 Certificates, in that order, in an
amount equal to the Allocated Realized Loss Amount allocable to each
such Class;
(iv) concurrently, to the Holders of the Class A Certificates,
in an amount equal to such Certificates' allocated share of any
Prepayment Interest Shortfalls on the Mortgage Loans to the extent not
covered by payments pursuant to Section 3.22 or 4.18 of this Agreement
and any shortfalls resulting from the application of the Relief Act or
similar state or local law or the bankruptcy code with respect to the
Mortgage Loans to the extent not previously reimbursed pursuant to
Section 1.02;
(v) sequentially, to the Holders of the Class M-1, Class M-2,
Class M-3, Class M-4, Class M-5, Class M-6, Class M-7, Class M-8, Class
M-9, Class M-10 and Class M-11 Certificates, in that order, in an
amount equal to such certificates' share of any Prepayment Interest
Shortfalls on the Mortgage Loans to the extent not covered by payments
pursuant to Sections 3.22 or Section 4.18 of this Agreement and any
Relief Act Interest Shortfall, in each case that were allocated to such
Class for such Distribution Date and for any prior Distribution Date,
to the extent not previously reimbursed pursuant to Section 1.02;
(vi) to the Reserve Fund, the amount by which the Net WAC Rate
Carryover Amounts, if any, with respect to the Offered Certificates
exceeds the amount in the Reserve Fund that was not distributed on
prior Distribution Dates;
(vii) to the Supplemental Interest Trust, an amount equal to
any Swap Termination Payment owed to the Swap Provider due to a Swap
Provider Trigger Event pursuant to the Swap Agreement;
(viii) to the Holders of the Class CE Certificates the
Interest Distribution Amount and any Overcollateralization Reduction
Amount for such Distribution Date; and
(ix) to the Holders of the Class R Certificates, in respect of
the Class R-III Interest, any remaining amounts; provided that if such
Distribution Date is the Distribution Date immediately following the
expiration of the latest Prepayment Charge term as identified on the
Mortgage Loan Schedule or any Distribution Date thereafter, then any
such remaining amounts will be distributed first, to the Holders of the
Class P Certificates, until the Certificate Principal Balance thereof
has been reduced to zero and second, to the Holders of the Class R
Certificates.
The Class CE Certificates are intended to receive all principal and
interest received by the Trust on the Mortgage Loans that is not otherwise
distributable to any other Class of Regular Certificates or REMIC Regular
Interests. If the Securities Administrator determines that the Residual
Certificates are entitled to any distributions on any Distribution Date other
than the final Distribution Date, the Securities Administrator, prior to any
such distribution to any Residual Certificate, shall notify the Depositor of
such impending distribution. Upon such notification, the Depositor will prepare
and request that the other parties hereto enter into an amendment to the Pooling
and Servicing Agreement pursuant to Section 12.01, to revise such mistake in the
distribution provisions.
On each Distribution Date, after making the distributions of the
Available Distribution Amount as set forth above, the Securities Administrator
will first, withdraw from the Reserve Fund all income from the investment of
funds in the Reserve Fund and distribute such amount to the Holders of the Class
CE Certificates, and second, withdraw from the Reserve Fund, to the extent of
amounts remaining on deposit therein, the amount of any Net WAC Rate Carryover
Amount for such Distribution Date and distribute such amount first, concurrently
to the Class A Certificates, on a PRO RATA basis; second, to the Class M-1
Certificates, third, to the Class M-2 Certificates, fourth, to the Class M-3
Certificates, fifth, to the Class M-4 Certificates, sixth, to the Class M-5
Certificates, seventh, to the Class M-6 Certificates, eighth, to the Class M-7
Certificates, ninth, to the Class M-8 Certificates, tenth, to the Class M-9
Certificates, eleventh, to the Class M-10 Certificates and twelfth, to the Class
M-11 Certificates, in each case to the extent to the extent any Net WAC Rate
Carryover Amount is allocable to each such Class.
(d) (i) On each Distribution Date (a) prior to the Stepdown Date or (b)
on which a Trigger Event is in effect, the Extra Principal Distribution Amount
shall be distributed in the following order of priority;
FIRST, concurrently, to the holders of the Class A Certificates as
follows:
(1) for each Distribution Date on which a Sequential Trigger
Event is not in effect for such Distribution Date, concurrently to the
Holders of the Class A Certificates, on a pro rata basis, based on the
Certificate Principal Balance of each such Class, until the Certificate
Principal Balance of each such Class has been reduced to zero;
provided, however that the pro rata allocation to the Class A-2A, Class
A-2B, Class A-2C and Class A-2D Certificates pursuant to this clause
shall be based on the total Certificate Principal Balance of the Class
A-2A, Class A-2B, Class A-2C and Class A-2D Certificates, but shall be
distributed to the Class A-2A, Class A-2B, Class A-2C and Class A-2D
Certificates on a sequential basis, in that order, until the
Certificate Principal Balance of each such Class has been reduced to
zero; and
(2) for each Distribution Date on which a Sequential Trigger
Event is in effect for such Distribution Date, concurrently to the
Holders of the Class A Certificates, on a pro rata basis, based on the
Certificate Principal Balance of each such Class, until the Certificate
Principal Balance of each such Class has been reduced to zero;
provided, however that the pro rata allocation to the Class A-1B1
Certificates and Class A-1B2 Certificates pursuant to this clause shall
be based on the total Certificate Principal Balance of the Class A-1B1
Certificates and Class A-1B2 Certificates, but shall be distributed to
the Class A-1B1 Certificates and the Class A-1B2 Certificates on a
sequential basis, in that order, until the Certificate Principal
Balances of the Class A-1B1 Certificates and Class A-1B2 Certificates
have been reduced to zero; provided, further that the pro rata
allocation to the Class A-2A, Class A-2B, Class A-2C and Class A-2D
Certificates pursuant to this clause shall be based on the total
Certificate Principal Balance of the Class A-2A, Class A-2B, Class A-2C
and Class A-2D Certificates, but shall be distributed to the Class
A-2A, Class A-2B, Class A-2C and Class A-2D Certificates on a
sequential basis, in that order, until the Certificate Principal
Balance of each such Class has been reduced to zero.
SECOND, sequentially, to the Holders of the Class M-1, Class M-2, Class
M-3, Class M-4, Class M-5, Class M-6, Class M-7, Class M-8, Class M-9, Class
M-10 and Class M-11 Certificates, in that order, until the Certificate Principal
Balance of each such Class has been reduced to zero.
(ii) On each Distribution Date (a) on or after the Stepdown
Date and (b) on which a Trigger Event is not in effect, distributions
of principal to the extent of the Extra Principal Distribution Amount
shall be distributed in the following order of priority:
FIRST, concurrently to the Class A Certificates as follows:
(1) the lesser of (x) the Group IA Principal
Distribution Amount and (y) the Class A-1A Principal
Distribution Amount, shall be distributed to the Holders of
the Class A-1A Certificates, until the Certificate Principal
Balance of the Class A-1A Certificates has been reduced to
zero;
(2) the lesser of (x) the Group IB Principal
Distribution Amount and (y) the Class A-1B Principal
Distribution Amount, shall be distributed concurrently to the
Holders of the Class A-1B1 Certificates and Class A-1B2
Certificates on a pro rata basis based on the Certificate
Principal Balance of each such Class until the Certificate
Principal Balance of each such Class has been reduced to zero;
provided, however that if a Sequential Trigger Event is in
effect on such Distribution Date, the distribution to the
Holders of the Class A-1B1 Certificates and Class A-1B2
Certificates pursuant to this clause first shall be made on a
sequential basis to the Class A-1B1 Certificates and Class
A-1B2 Certificates, in that order, until the Certificate
Principal Balance of each such Class has been reduced to zero;
and
(3) the lesser of (x) the Group II Principal
Distribution Amount and (y) the Class A-2 Principal
Distribution Amount, shall be distributed sequentially to the
Holders of the Class A-2A, Class A-2B, Class A-2C and Class
A-2D Certificates, in that order, until the Certificate
Principal Balance of each such Class has been reduced to zero;
SECOND, the lesser of (x) the excess of (i) the Principal
Distribution Amount over (ii) the amount distributed to the
Holders of the Class A Certificates pursuant to clause FIRST
of this Section 5.01(d)(ii), and (y) the Class M-1 Principal
Distribution Amount, shall be distributed to the Holders of
the Class M-1 Certificates, until the Certificate Principal
Balance of such Class has been reduced to zero;
THIRD, the lesser of (x) the excess of (i) the Principal
Distribution Amount over (ii) the sum of the amounts
distributed to the Holders of the Class A Certificates
pursuant to clause first of this Section 5.01(d)(ii) and to
the Holders of the Class M-1 Certificates pursuant to clause
second of this Section 5.01(d)(ii), and (y) the Class M-2
Principal Distribution Amount, shall be distributed to the
Holders of the Class M-2 Certificates, until the Certificate
Principal Balance of such Class has been reduced to zero;
FOURTH, the lesser of (x) the excess of (i) the Principal
Distribution Amount over (ii) the sum of the amounts
distributed to the Holders of the Class A Certificates
pursuant to clause first of this Section 5.01(d)(ii), to the
Holders of the Class M-1 Certificates pursuant to clause
second of this Section 5.01(d)(ii) and to the Holders of the
Class M-2 Certificates pursuant to clause third of this
Section 5.01(d)(ii), and (y) the Class M-3 Principal
Distribution Amount, shall be distributed to the Holders of
the Class M-3 Certificates, until the Certificate Principal
Balance of such Class has been reduced to zero;
FIFTH, the lesser of (x) the excess of (i) the Principal
Distribution Amount over (ii) the sum of the amounts
distributed to the Holders of the Class A Certificates
pursuant to clause first of this Section 5.01(d)(ii), to the
Holders of the Class M-1 Certificates pursuant to clause
second of this Section 5.01(d)(ii), to the Holders of the
Class M-2 Certificates pursuant to clause third of this
Section 5.01(d)(ii) and to the Holders of the Class M-3
Certificates pursuant to clause fourth of this Section
5.01(d)(ii), and (y) the Class M-4 Principal Distribution
Amount, shall be distributed to the Holders of the Class M-4
Certificates, until the Certificate Principal Balance of such
Class has been reduced to zero;
SIXTH, the lesser of (x) the excess of (i) the Principal
Distribution Amount over (ii) the sum of the amounts
distributed to the Holders of the Class A Certificates
pursuant to clause first of this Section 5.01(d)(ii), to the
Holders of the Class M-1 Certificates pursuant to clause
second of this Section 5.01(d)(ii), to the Holders of the
Class M-2 Certificates pursuant to clause third of this
Section 5.01(d)(ii), to the Holders of the Class M-3
Certificates pursuant to clause fourth of this Section
5.01(d)(ii) and to the Holders of the Class M-4 Certificates
pursuant to clause fifth of this Section 5.01(d)(ii), and (y)
the Class M-5 Principal Distribution Amount, shall be
distributed to the Holders of the Class M-5 Certificates,
until the Certificate Principal Balance of such Class has been
reduced to zero;
SEVENTH, the lesser of (x) the excess of (i) the Principal
Distribution Amount over (ii) the sum of the amounts
distributed to the Holders of the Class A Certificates
pursuant to clause first of this Section 5.01(d)(ii), to the
Holders of the Class M-1 Certificates pursuant to clause
second of this Section 5.01(d)(ii), to the Holders of the
Class M-2 Certificates pursuant to clause third of this
Section 5.01(d)(ii), to the Holders of the Class M-3
Certificates pursuant to clause fourth of this Section
5.01(d)(ii), to the Holders of the Class M-4 Certificates
pursuant to clause fifth of this Section 5.01(d)(ii) and to
the Holders of the Class M-5 Certificates pursuant to clause
sixth of this Section 5.01(d)(ii), and (y) the Class M-6
Principal Distribution Amount, shall be distributed to the
Holders of the Class M-6 Certificates, until the Certificate
Principal Balance of such Class has been reduced to zero;
EIGHTH, the lesser of (x) the excess of (i) the Principal
Distribution Amount over (ii) the sum of the amounts
distributed to the Holders of the Class A Certificates
pursuant to clause first of this Section 5.01(d)(ii), to the
Holders of the Class M-1 Certificates pursuant to clause
second of this Section 5.01(d)(ii), to the Holders of the
Class M-2 Certificates pursuant to clause third of this
Section 5.01(d)(ii), to the Holders of the Class M-3
Certificates pursuant to clause fourth of this Section
5.01(d)(ii), to the Holders of the Class M-4 Certificates
pursuant to clause fifth of this Section 5.01(d)(ii), to the
Holders of the Class M-5 Certificates pursuant to clause sixth
of this Section 5.01(d)(ii) and to the Holders of the Class
M-6 Certificates pursuant to clause seventh of this Section
5.01(d)(ii), and (y) the Class M-7 Principal Distribution
Amount, shall be distributed to the Holders of the Class M-7
Certificates, until the Certificate Principal Balance of such
Class has been reduced to zero;
NINTH, the lesser of (x) the excess of (i) the Principal
Distribution Amount over (ii) the sum of the amounts
distributed to the Holders of the Class A Certificates
pursuant to clause first of this Section 5.01(d)(ii), to the
Holders of the Class M-1 Certificates pursuant to clause
second of this Section 5.01(d)(ii), to the Holders of the
Class M-2 Certificates pursuant to clause third of this
Section 5.01(d)(ii), to the Holders of the Class M-3
Certificates pursuant to clause fourth of this Section
5.01(d)(ii), to the Holders of the Class M-4 Certificates
pursuant to clause fifth of this Section 5.01(d)(ii), to the
Holders of the Class M-5 Certificates pursuant to clause sixth
of this Section 5.01(d)(ii), to the Holders of the Class M-6
Certificates pursuant to clause seventh of this Section
5.01(d)(ii) and to the Holders of the Class M-7 Certificates
pursuant to clause eighth of this Section 5.01(d)(ii), and (y)
the Class M-8 Principal Distribution Amount, shall be
distributed to the Holders of the Class M-8 Certificates,
until the Certificate Principal Balance of such Class has been
reduced to zero;
TENTH, the lesser of (x) the excess of (i) the Principal
Distribution Amount over (ii) the sum of the amounts
distributed to the Holders of the Class A Certificates
pursuant to clause first of this Section 5.01(d)(ii), to the
Holders of the Class M-1 Certificates pursuant to clause
second of this Section 5.01(d)(ii), to the Holders of the
Class M-2 Certificates pursuant to clause third of this
Section 5.01(d)(ii), to the Holders of the Class M-3
Certificates pursuant to clause fourth of this Section
5.01(d)(ii), to the Holders of the Class M-4 Certificates
pursuant to clause fifth of this Section 5.01(d)(ii), to the
Holders of the Class M-5 Certificates pursuant to clause sixth
of this Section 5.01(d)(ii), to the Holders of the Class M-6
Certificates pursuant to clause seventh of this Section
5.01(d)(ii), to the Holders of the Class M-7 Certificates
pursuant to clause eighth of this Section 5.01(d)(ii) and to
the Holders of the Class M-8 Certificates pursuant to clause
ninth of this Section 5.01(d)(ii), and (y) the Class M-9
Principal Distribution Amount, shall be distributed to the
Holders of the Class M-9 Certificates, until the Certificate
Principal Balance of such Class has been reduced to zero;
ELEVENTH, the lesser of (x) the excess of (i) the Principal
Distribution Amount over (ii) the sum of the amounts
distributed to the Holders of the Class A Certificates
pursuant to clause first of this Section 5.01(d)(ii), to the
Holders of the Class M-1 Certificates pursuant to clause
second of this Section 5.01(d)(ii), to the Holders of the
Class M-2 Certificates pursuant to clause third of this
Section 5.01(d)(ii), to the Holders of the Class M-3
Certificates pursuant to clause fourth of this Section
5.01(d)(ii), to the Holders of the Class M-4 Certificates
pursuant to clause fifth of this Section 5.01(d)(ii), to the
Holders of the Class M-5 Certificates pursuant to clause sixth
of this Section 5.01(d)(ii), to the Holders of the Class M-6
Certificates pursuant to clause seventh of this Section
5.01(d)(ii), to the Holders of the Class M-7 Certificates
pursuant to clause eighth of this Section 5.01(d)(ii), to the
Holders of the Class M-8 Certificates pursuant to clause ninth
of this Section 5.01(d)(ii) and to the Holders of the Class
M-9 Certificates pursuant to clause tenth of this Section
5.01(d)(ii), and (y) the Class M-10 Principal Distribution
Amount, shall be distributed to the Holders of the Class M-10
Certificates, until the Certificate Principal Balance of such
Class has been reduced to zero; and
TWELFTH, the lesser of (x) the excess of (i) the Principal
Distribution Amount over (ii) the sum of the amounts
distributed to the Holders of the Class A Certificates
pursuant to clause first of this Section 5.01(d)(ii), to the
Holders of the Class M-1 Certificates pursuant to clause
second of this Section 5.01(d)(ii), to the Holders of the
Class M-2 Certificates pursuant to clause third of this
Section 5.01(d)(ii), to the Holders of the Class M-3
Certificates pursuant to clause fourth of this Section
5.01(d)(ii), to the Holders of the Class M-4 Certificates
pursuant to clause fifth of this Section 5.01(d)(ii), to the
Holders of the Class M-5 Certificates pursuant to clause sixth
of this Section 5.01(d)(ii), to the Holders of the Class M-6
Certificates pursuant to clause seventh of this Section
5.01(d)(ii), to the Holders of the Class M-7 Certificates
pursuant to clause eighth of this Section 5.01(d)(ii), to the
Holders of the Class M-8 Certificates pursuant to clause ninth
of this Section 5.01(d)(ii), to the Holders of the Class M-9
Certificates pursuant to clause tenth of this Section
5.01(d)(ii) and to the Holders of the Class M-10 Certificates
pursuant to clause eleventh of this Section 5.01(d)(ii), and
(y) the Class M-11 Principal Distribution Amount, shall be
distributed to the Holders of the Class M-11 Certificates,
until the Certificate Principal Balance of such Class has been
reduced to zero.
(e) As described in Section 5.01(c)(2), (3), (4), (6) and (7) above,
Net Swap Payments and Swap Termination Payments (other than Swap Termination
Payments resulting from a Swap Provider Trigger Event) payable by the
Supplemental Interest Trust to the Swap Provider pursuant to the Swap Agreement
shall be deducted from the Interest Remittance Amount, and to the extent of any
such remaining amounts due, from the Principal Remittance Amount, prior to any
distributions to the Certificateholders. On each Distribution Date, such amounts
will be remitted to the Supplemental Interest Trust, first to make any Net Swap
Payment owed to the Swap Provider pursuant to the Swap Agreement for such
Distribution Date, and second to make any Swap Termination Payment (not due to a
Swap Provider Trigger Event) owed to the Swap Provider pursuant to the Swap
Agreement for such Distribution Date. Any Swap Termination Payment triggered by
a Swap Provider Trigger Event owed to the Swap Provider pursuant to the Swap
Agreement will be subordinated to distributions to the Holders of the Offered
Certificates and shall be paid pursuant to Section 5.01(c)(8)(vii).
(f) On each Distribution Date, to the extent required, following the
distribution of the Net Monthly Excess Cashflow and withdrawals from the Reserve
Fund, the Securities Administrator will withdraw any amounts in the Supplemental
Interest Trust and distribute such amounts in the following order of priority:
FIRST, to the Swap Provider, any Net Swap Payment owed to the Swap
Provider pursuant to the Swap Agreement for such Distribution Date;
SECOND, to the Swap Provider, any Swap Termination Payment owed to the
Swap Provider not due to a Swap Provider Trigger Event pursuant to the Swap
Agreement;
THIRD, concurrently, to each Class of Class A Certificates, the related
Senior Interest Distribution Amount remaining undistributed after the
distributions of the Group IA Interest Remittance Amount, the Group IB Interest
Remittance Amount and the Group II Interest Remittance Amount, on a PRO RATA
basis based on such respective remaining Senior Interest Distribution Amounts;
FOURTH, sequentially, to the Class ▇-▇, ▇▇▇▇▇ ▇-▇, Class M-3, Class
M-4, Class M-5, Class M-6, Class M-7, Class M-8, Class M-9, Class M-10 and Class
M-11 Certificates, in that order, the related Interest Distribution Amount and
Interest Carry Forward Amount, to the extent remaining undistributed after the
distributions of the Group IA Interest Remittance Amount, the Group IB Interest
Remittance Amount, the Group II Interest Remittance Amount and the Net Monthly
Excess Cashflow;
FIFTH, concurrently, to each Class of Class A Certificates, the related
Net WAC Rate Carryover Amount, to the extent remaining undistributed after
distributions are made from the Reserve Fund, on a PRO RATA basis based on such
respective Net WAC Rate Carryover Amounts remaining;
SIXTH, sequentially, to the Class ▇-▇, ▇▇▇▇▇ ▇-▇, Class M-3, Class M-4,
Class M-5, Class M-6, Class M-7, Class M-8, Class M-9, Class M-10 and Class M-11
Certificates, in that order, the related Net WAC Rate Carryover Amount, to the
extent remaining undistributed after distributions are made from the Reserve
Fund;
SEVENTH, to the holders of the Class or Classes of Certificates then
entitled to receive distributions in respect of principal, in an amount
necessary to maintain the Required Overcollateralization Amount after taking
into account distributions made pursuant to Section 5.01(c)(8)(i) above;
EIGHTH, sequentially to the Class ▇-▇, ▇▇▇▇▇ ▇-▇, Class M-3, Class M-4,
Class M-5, Class M-6, Class M-7, Class M-8, Class M-9, Class M-10 and Class M-11
Certificates, in that order, in each case up to the related Allocated Realized
Loss Amount related to such Certificates for such Distribution Date remaining
undistributed after distribution of the Net Monthly Excess Cashflow;
NINTH, to the Swap Provider, an amount equal to any Swap Termination
Payment owed to the Swap Provider due to a Swap Provider Trigger Event pursuant
to the Swap Agreement; and
TENTH, to the Class CE Certificates, any remaining amounts.
(g) On each Distribution Date, the Securities Administrator shall
withdraw any amounts then on deposit in the Distribution Account that represent
Prepayment Charges and shall distribute such amounts to the Class P
Certificateholders as described above.
(h) All distributions made with respect to each Class of Certificates
on each Distribution Date shall be allocated PRO RATA among the outstanding
Certificates in such Class based on their respective Percentage Interests.
Payments in respect of each Class of Certificates on each Distribution Date will
be made to the Holders of the respective Class of record on the related Record
Date (except as otherwise provided in Section 5.01(j) or Section 10.01
respecting the final distribution on such Class), based on the aggregate
Percentage Interest represented by their respective Certificates, and shall be
made by wire transfer of immediately available funds to the account of any such
Holder at a bank or other entity having appropriate facilities therefor, if such
Holder shall have so notified the Securities Administrator in writing at least
five (5) Business Days prior to the Record Date immediately prior to such
Distribution Date and is the registered owner of Certificates having an initial
aggregate Certificate Principal Balance that is in excess of the lesser of (i)
5,000,000 or (ii) two-thirds of the initial Certificate Principal Balance of
such Class of Certificates, or otherwise by check mailed by first class mail to
the address of such Holder appearing in the Certificate Register. The final
distribution on each Certificate will be made in like manner, but only upon
presentment and surrender of such Certificate at the Corporate Trust Office of
the Securities Administrator or such other location specified in the notice to
Certificateholders of such final distribution.
Each distribution with respect to a Book-Entry Certificate shall be
paid to the Depository, as Holder thereof, and the Depository shall be
responsible for crediting the amount of such distribution to the accounts of its
Depository Participants in accordance with its normal procedures. Each
Depository Participant shall be responsible for disbursing such distribution to
the Certificate Owners that it represents and to each indirect participating
brokerage firm (a "brokerage firm" or "indirect participating firm") for which
it acts as agent. Each brokerage firm shall be responsible for disbursing funds
to the Certificate Owners that it represents. None of the Trustee, the
Depositor, the Servicer, the Securities Administrator or the Master Servicer
shall have any responsibility therefor except as otherwise provided by this
Agreement or applicable law.
(i) The rights of the Certificateholders to receive distributions in
respect of the Certificates, and all interests of the Certificateholders in such
distributions, shall be as set forth in this Agreement. None of the Holders of
any Class of Certificates, the Trustee, the Servicer, the Securities
Administrator or the Master Servicer shall in any way be responsible or liable
to the Holders of any other Class of Certificates in respect of amounts properly
previously distributed on the Certificates.
(j) Except as otherwise provided in Section 10.01, whenever the
Securities Administrator expects that the final distribution with respect to any
Class of Certificates will be made on the next Distribution Date, the Securities
Administrator shall, no later than three (3) days before the related
Distribution Date, mail to each Holder on such date of such Class of
Certificates a notice to the effect that:
(i) the Securities Administrator expects that the final
distribution with respect to such Class of Certificates will
be made on such Distribution Date but only upon presentation
and surrender of such Certificates at the office of the
Securities Administrator therein specified, and
(ii) no interest shall accrue on such Certificates from and
after the end of the related Interest Accrual Period.
Any funds not distributed to any Holder or Holders of Certificates of
such Class on such Distribution Date because of the failure of such Holder or
Holders to tender their Certificates shall, on such date, be set aside and held
in trust by the Securities Administrator and credited to the account of the
appropriate non-tendering Holder or Holders. If any Certificates as to which
notice has been given pursuant to this Section 5.01(j) shall not have been
surrendered for cancellation within six months after the time specified in such
notice, the Securities Administrator shall mail a second notice to the remaining
non-tendering Certificateholders to surrender their Certificates for
cancellation in order to receive the final distribution with respect thereto. If
within one year after the second notice all such Certificates shall not have
been surrendered for cancellation, the Securities Administrator shall, directly
or through an agent, mail a final notice to the remaining non-tendering
Certificateholders concerning surrender of their Certificates but shall continue
to hold any remaining funds for the benefit of non-tendering Certificateholders.
The costs and expenses of maintaining the funds in trust and of contacting such
Certificateholders shall be paid out of the assets remaining in such trust fund.
If within one year after the final notice any such Certificates shall not have
been surrendered for cancellation, the Securities Administrator shall pay to the
Depositor all such amounts, and all rights of non-tendering Certificateholders
in or to such amounts shall thereupon cease. No interest shall accrue or be
payable to any Certificateholder on any amount held in trust by the Securities
Administrator as a result of such Certificateholder's failure to surrender its
Certificate(s) on the final Distribution Date for final payment thereof in
accordance with this Section 5.01(j). Any such amounts held in trust by the
Securities Administrator shall be held uninvested in an Eligible Account.
(k) Notwithstanding anything to the contrary herein, (i) in no event
shall the Certificate Principal Balance of a Class A Certificate or a Mezzanine
Certificate be reduced more than once in respect of any particular amount both
(a) allocated to such Certificate in respect of Realized Losses pursuant to
Section 5.04 and (b) distributed to the Holder of such Certificate in reduction
of the Certificate Principal Balance thereof pursuant to this Section 5.01 from
Net Monthly Excess Cashflow and (ii) in no event shall the Uncertificated
Balance of a REMIC Regular Interest be reduced more than once in respect of any
particular amount both (a) allocated to such REMIC Regular Interest in respect
of Realized Losses pursuant to Section 5.04 and (b) distributed on such REMIC
Regular Interest in reduction of the Uncertificated Balance thereof pursuant to
this Section 5.01.
SECTION 5.02. Statements to Certificateholders.
On each Distribution Date, the Securities Administrator (based on the
information set forth in the Servicer Reports for such Distribution Date and
information provided by the Trustee or the Swap Provider under the Swap
Agreement with respect to payments made pursuant to the Swap Agreement) shall
make available to each Holder of the Certificates, a statement as to the
distributions made on such Distribution Date setting forth:
(i) the amount of the distribution made on such Distribution
Date to the Holders of the Certificates of each Class allocable to
principal, and the amount of the distribution made on such Distribution
Date to the Holders of the Class P Certificates allocable to Prepayment
Charges;
(ii) the amount of the distribution made on such Distribution
Date to the Holders of the Certificates of each Class allocable to
interest;
(iii) the aggregate Servicing Fee received by the Servicers,
and the Master Servicing Fee received by the Master Servicer during the
related Due Period;
(iv) the aggregate amount of P&I Advances for such
Distribution Date;
(v) Reserved;
(vi) the number, aggregate principal balance, weighted average
remaining term to maturity and weighted average Mortgage Rate of the
Mortgage Loans as of the related Due Date;
(vii) the number and aggregate unpaid principal balance of
Mortgage Loans (a) delinquent thirty (30) to fifty-nine (59) days, (b)
delinquent sixty (60) to eighty-nine (89) days, (c) delinquent ninety
(90) or more days, in each case, as of the last day of the preceding
calendar month, (d) as to which foreclosure proceedings have been
commenced and (e) with respect to which the related Mortgagor has filed
for protection under applicable bankruptcy laws, with respect to whom
bankruptcy proceedings are pending or with respect to whom bankruptcy
protection is in force;
(viii) with respect to any Mortgage Loan that became an REO
Property during the preceding calendar month, the loan number of such
Mortgage Loan, the unpaid principal balance and the Scheduled Principal
Balance of such Mortgage Loan;
(ix) if available, the book value of any REO Property as of
the close of business on the last Business Day of the calendar month
preceding the Distribution Date;
(x) the aggregate amount of Principal Prepayments made during
the related Prepayment Period and the aggregate amount of any
Prepayment Charges received in respect thereof;
(xi) the aggregate amount of Realized Losses incurred during
the related Prepayment Period and the aggregate amount of Realized
Losses incurred since the Closing Date;
(xii) the aggregate amount of Extraordinary Trust Fund
Expenses withdrawn from the Distribution Account for such Distribution
Date;
(xiii) the aggregate Certificate Principal Balance of each
Class of Certificates, after giving effect to the distributions, and
allocations of Realized Losses, made on such Distribution Date,
separately identifying any reduction thereof due to allocations of
Realized Losses;
(xiv) the Certificate Factor for each such Class of
Certificates applicable to such Distribution Date;
(xv) the Interest Distribution Amount in respect of the Class
A Certificates, the Mezzanine Certificates and the Class CE
Certificates for such Distribution Date and the Interest Carry Forward
Amount, if any, with respect to the Class A Certificates and the
Mezzanine Certificates on such Distribution Date, and in the case of
the Class A Certificates and the Mezzanine Certificates separately
identifying any reduction thereof due to allocations of Realized
Losses, Prepayment Interest Shortfalls, Relief Act Interest Shortfalls
and Net WAC Rate Carryover Amounts;
(xvi) the aggregate amount of any Prepayment Interest
Shortfall for such Distribution Date, to the extent not covered by
payments by ▇▇▇▇▇ Fargo pursuant to Section 3.22 of this Agreement,
Countrywide pursuant to the Servicing Agreement or the Master Servicer
pursuant to Section 4.18 of this Agreement;
(xvii) the aggregate amount of Relief Act Interest Shortfalls
for such Distribution Date;
(xviii) the Required Overcollateralization Amount and the
Credit Enhancement Percentage for such Distribution Date;
(xix) the Overcollateralization Increase Amount, if any, for
such Distribution Date;
(xx) the Overcollateralization Reduction Amount, if any, for
such Distribution Date;
(xxi) the Net WAC Rate Carryover Amount, if any, for such
Distribution Date;
(xxii) the Net WAC Rate Carryover Amount, if any, outstanding
after reimbursements therefor on such Distribution Date;
(xxiii) the respective Pass-Through Rates applicable to the
Class A Certificates, the Mezzanine Certificates and the Class CE
Certificates for such Distribution Date;
(xxiv) the amount of any deposit to the Reserve Fund
contemplated by Section 3.24(b);
(xxv) the balance of the Reserve Fund prior to the deposit or
withdrawal of any amounts on such Distribution Date;
(xxvi) the amount of any deposit to the Reserve Fund pursuant
to Section 5.01(c)(8)(vi);
(xxvii) the balance of the Reserve Fund after all deposits and
withdrawals on such Distribution Date;
(xxviii) the Loss Severity Percentage with respect to each
Mortgage Loan;
(xxix) the Aggregate Loss Severity Percentage; and
(xxx) amounts payable by or to the Supplemental Interest Trust
in respect of the Swap Agreement.
The Securities Administrator will make such statement (and, at its
option, any additional files containing the same information in an alternative
format) available each month to the Certificateholders and the Rating Agencies
via the Securities Administrator's internet website. The Securities
Administrator's internet website shall initially be located at
http:\\▇▇▇.▇▇▇▇▇▇▇.▇▇▇ and assistance in using the website can be obtained by
calling the Securities Administrator's customer service desk at ▇-▇▇▇-▇▇▇-▇▇▇▇.
Parties that are unable to use the above distribution options are entitled to
have a paper copy mailed to them via first class mail by calling the customer
service desk and indicating such. The Securities Administrator shall have the
right to change the way such statements are distributed in order to make such
distribution more convenient and/or more accessible to the above parties and the
Securities Administrator shall provide timely and adequate notification to all
above parties regarding any such changes.
In the case of information furnished pursuant to subclauses (i) and
(ii) above, the amounts shall be expressed as a dollar amount per Single
Certificate of the relevant Class.
Within a reasonable period of time after the end of each calendar year,
the Securities Administrator shall furnish upon request to each Person who at
any time during the calendar year was a Holder of a Regular Certificate a
statement containing the information set forth in subclauses (i) through (iii)
above, aggregated for such calendar year or applicable portion thereof during
which such person was a Certificateholder. Such obligation of the Securities
Administrator shall be deemed to have been satisfied to the extent that
substantially comparable information shall be provided by the Securities
Administrator pursuant to any requirements of the Code as from time to time are
in force.
Within a reasonable period of time after the end of each calendar year,
the Securities Administrator shall furnish upon request to each Person who at
any time during the calendar year was a Holder of a Residual Certificate a
statement setting forth the amount, if any, actually distributed with respect to
the Residual Certificates, as appropriate, aggregated for such calendar year or
applicable portion thereof during which such Person was a Certificateholder.
The Securities Administrator shall, upon request, furnish to each
Certificateholder during the term of this Agreement, such periodic, special, or
other reports or information, whether or not provided for herein, as shall be
reasonable with respect to the Certificateholder, as applicable, or otherwise
with respect to the purposes of this Agreement, all such reports or information
to be provided at the expense of the Certificateholder, in accordance with such
reasonable and explicit instructions and directions as the Certificateholder may
provide.
On each Distribution Date the Securities Administrator shall provide
Bloomberg Financial Markets, L.P. ("Bloomberg") CUSIP level factors for each
Class of Certificates as of such Distribution Date, using a format and media
mutually acceptable to the Securities Administrator and Bloomberg.
SECTION 5.03. Servicer Reports; P&I Advances.
(a) (i) With respect to ▇▇▇▇▇ Fargo, on the 18th calendar day of each
month, and if the 18th calendar day is not a Business Day, the immediately
following Business Day, ▇▇▇▇▇ Fargo shall deliver to the Master Servicer and the
Securities Administrator by telecopy or electronic mail (or by such other means
as the related Servicer, the Master Servicer and the Securities Administrator
may agree from time to time) a remittance report containing such information
with respect to the related Mortgage Loans and the related Distribution Date as
is reasonably available to the related Servicer as the Master Servicer or the
Securities Administrator may reasonably require so as to enable the Master
Servicer to master service the related Mortgage Loans and oversee the servicing
by the related Servicer and the Securities Administrator to fulfill its
obligations hereunder with respect to securities and tax reporting.
(b) The amount of P&I Advances to be made by the related Servicer on
any Distribution Date shall equal, subject to Section 5.03(d), (i) with respect
to the Mortgage Loans other than the Simple Interest Mortgage Loans, the
aggregate amount of Monthly Payments (net of the related Servicing Fees), due
during the related Due Period in respect of the Mortgage Loans serviced by such
Servicer, which Monthly Payments were delinquent as of the close of business on
the related Determination Date, (ii) with respect to the Simple Interest
Mortgage Loans, thirty (30) days' interest (net of the related Servicing Fees)
on each such Simple Interest Mortgage Loan for which the Monthly Payment was due
during the related Due Period which Monthly Payments were delinquent as of the
close of business on the related Determination Date and (iii) with respect to
each REO Property, which was acquired during or prior to the related Prepayment
Period and as to which an REO Disposition did not occur during the related
Prepayment Period, an amount equal to the excess, if any, of the REO Imputed
Interest on such REO Property for the most recently ended calendar month, over
the net income from such REO Property deposited in the related Collection
Account pursuant to Section 3.21 of this Agreement for distribution on such
Distribution Date; provided, however, no Servicer shall be required to make P&I
Advances with respect to Relief Act Interest Shortfalls, or with respect to
Prepayment Interest Shortfalls in excess of its obligations under Section 3.22
or under the Interim Servicing Agreement. For purposes of the preceding
sentence, the Monthly Payment on each Balloon Mortgage Loan with a delinquent
Balloon Payment is equal to the assumed monthly payment that would have been due
on the related Due Date based on the original principal amortization schedule
for such Balloon Mortgage Loan.
On the Servicer Remittance Date each Servicer shall remit in
immediately available funds to the Securities Administrator for deposit in the
Distribution Account an amount equal to the aggregate amount of P&I Advances, if
any, to be made in respect of the related Mortgage Loans for the related
Distribution Date either (i) from its own funds or (ii) from the related
Collection Account, to the extent of any Amounts Held For Future Distribution on
deposit therein (in which case it will cause to be made an appropriate entry in
the records of the related Collection Account that Amounts Held For Future
Distribution have been, as permitted by this Section 5.03, used by the related
Servicer in discharge of any such P&I Advance) or (iii) in the form of any
combination of (i) and (ii) aggregating the total amount of P&I Advances to be
made by the related Servicer with respect to the related Mortgage Loans. In
addition, the related Servicer shall have the right to reimburse itself for any
outstanding P&I Advance made from its own funds from Amounts Held for Future
Distribution. Any Amounts Held For Future Distribution used by the related
Servicer to make P&I Advances or to reimburse itself for outstanding P&I
Advances shall be appropriately reflected in the related Servicer's records and
replaced by the related Servicer by deposit in the related Collection Account no
later than the close of business on the Servicer Remittance Date immediately
following the Due Period or Prepayment Period for which such amounts relate. The
Securities Administrator will notify the related Servicer and the Master
Servicer by the close of business on the Business Day prior to the Distribution
Date in the event that the amount remitted by the related Servicer to the
Securities Administrator on such date is less than the P&I Advances required to
be made by the related Servicer for the related Distribution Date.
(c) The obligation of each Servicer to make such P&I Advances is
mandatory, notwithstanding any other provision of this Agreement but subject to
(d) below, and, with respect to any related Mortgage Loan or REO Property, shall
continue until a Final Recovery Determination in connection therewith or the
removal thereof from the Trust Fund pursuant to any applicable provision of this
Agreement, except as otherwise provided in this Section.
(d) Notwithstanding anything herein to the contrary, no P&I Advance or
Servicing Advance shall be required to be made hereunder by the related Servicer
if such P&I Advance or Servicing Advance would, if made, constitute a
Nonrecoverable P&I Advance or Nonrecoverable Servicing Advance, respectively.
The determination by the related Servicer that it has made a Nonrecoverable P&I
Advance or a Nonrecoverable Servicing Advance or that any proposed P&I Advance
or Servicing Advance, if made, would constitute a Nonrecoverable P&I Advance or
Nonrecoverable Servicing Advance, respectively, shall be evidenced by a
certification of a Servicing Officer delivered to the Master Servicer.
(e) Subject to and in accordance with the provisions of Article VIII of
this Agreement, in the event ▇▇▇▇▇ Fargo fails to make any required P&I Advance,
then the Trustee (in its capacity as successor servicer) or any other successor
Servicer shall be required to make such P&I Advance on the Distribution Date on
which such Servicer was required to make such Advance, subject to its
determination of recoverability. In addition, in the event that Countrywide
fails to make a required P&I Advance under the Servicing Agreement, the Master
Servicer (in its capacity as successor Servicer) will be required to make such
P&I Advance on the Distribution Date on which such Servicer was required to make
such P&I Advance, subject to its determination of recoverability.
SECTION 5.04. Allocation of Realized Losses.
(a) Prior to the Determination Date, each Servicer shall determine as
to each Mortgage Loan serviced by such Servicer and any related REO Property and
include in the monthly remittance report provided to the Master Servicer and the
Securities Administrator (substantially in the form of Schedule 4 hereto) such
information as is reasonably available to the Servicers as the Master Servicer
or the Securities Administrator may reasonably require so as to enable the
Master Servicer to master service the Mortgage Loans and oversee the servicing
by the Servicers and the Securities Administrator to fulfill its obligations
hereunder with respect to securities and tax reporting, which shall include, but
not be limited to: (i) the total amount of Realized Losses, if any, incurred in
connection with any Final Recovery Determinations made during the related
Prepayment Period; and (ii) the respective portions of such Realized Losses
allocable to interest and allocable to principal. Prior to each Determination
Date, each Servicer shall also determine as to each Mortgage Loan: (i) the total
amount of Realized Losses, if any, incurred in connection with any Deficient
Valuations made during the related Prepayment Period; and (ii) the total amount
of Realized Losses, if any, incurred in connection with Debt Service Reductions
in respect of Monthly Payments due during the related Due Period.
(b) All Realized Losses on the Mortgage Loans allocated to any REMIC I
Regular Interest pursuant to Section 5.04(c) on the Mortgage Loans shall be
allocated by the Securities Administrator on each Distribution Date as follows:
FIRST, to Net Monthly Excess Cashflow; SECOND, to the Class CE Certificates and
to Net Swap Payments received from the Swap Provider under the Swap Agreement
for that purpose; THIRD, to the Class M-11 Certificates until the Certificate
Principal Balance of the Class M-11 Certificates has been reduced to zero,
fourth, to the Class M-10 Certificates until the Certificate Principal Balance
of the Class M-10 Certificates has been reduced to zero, FIFTH, to the Class M-9
Certificates, until the Certificate Principal Balance of the Class M-9
Certificates, has been reduced to zero, SIXTH, to the Class M-8 Certificates,
until the Certificate Principal Balance of the Class M-8 Certificates has been
reduced to zero; SEVENTH, to the Class M-7 Certificates, until the Certificate
Principal Balance of the Class M-7 Certificates has been reduced to zero;
EIGHTH, to the Class M-6 Certificates, until the Certificate Principal Balance
of the Class M-6 Certificates has been reduced to zero; NINTH, to the Class M-5
Certificates, until the Certificate Principal Balance of the Class M-5
Certificates has been reduced to zero; TENTH, to the Class M-4 Certificates,
until the Certificate Principal Balance of the Class M-4 Certificates has been
reduced to zero; ELEVENTH, to the Class M-3 Certificates, until the Certificate
Principal Balance of the Class M-3 Certificates has been reduced to zero;
TWELFTH, to the Class M-2 Certificates, until the Certificate Principal Balance
of the Class M-2 Certificates has been reduced to zero; and THIRTEENTH, to the
Class M-1 Certificates, until the Certificate Principal Balance of the Class M-1
Certificates has been reduced to zero. All Realized Losses to be allocated to
the Certificate Principal Balances of all Classes on any Distribution Date shall
be so allocated after the actual distributions to be made on such date as
provided above. All references above to the Certificate Principal Balance of any
Class of Certificates shall be to the Certificate Principal Balance of such
Class immediately prior to the relevant Distribution Date, before reduction
thereof by any Realized Losses, in each case to be allocated to such Class of
Certificates, on such Distribution Date.
Any allocation of Realized Losses to a Mezzanine Certificate on any
Distribution Date shall be made by reducing the Certificate Principal Balance
thereof by the amount so allocated; any allocation of Realized Losses to a Class
CE Certificate shall be made by reducing the amount otherwise payable in respect
thereof pursuant to Section 5.01(c)(8)(viii). No allocations of any Realized
Losses shall be made to the Certificate Principal Balances of the Class A
Certificates or Class P Certificates.
As used herein, an allocation of a Realized Loss on a "PRO RATA basis"
among two or more specified Classes of Certificates means an allocation on a PRO
RATA basis, among the various Classes so specified, to each such Class of
Certificates on the basis of their then outstanding Certificate Principal
Balances prior to giving effect to distributions to be made on such Distribution
Date. All Realized Losses and all other losses allocated to a Class of
Certificates hereunder will be allocated among the, Certificates of such Class
in proportion to the Percentage Interests evidenced thereby.
In addition, in the event that a Servicer receives any Subsequent
Recoveries with respect to a Mortgage Loan serviced by it, the related Servicer
shall deposit such funds into the related Collection Account pursuant to Section
3.08. If, after taking into account such Subsequent Recoveries, and any
Subsequent Recoveries received by Countrywide, the amount of a Realized Loss is
reduced, the amount of such Subsequent Recoveries will be applied to increase
the Certificate Principal Balance of the Class of Subordinate Certificates with
the highest payment priority to which Realized Losses have been allocated, but
not by more than the amount of Realized Losses previously allocated to that
Class of Subordinate Certificates pursuant to this Section 5.04 and not
previously reimbursed to such Class of Subordinate Certificates with Net Monthly
Excess Cashflow pursuant to Section 5.01(c)(8). The amount of any remaining
Subsequent Recoveries will be applied to sequentially increase the Certificate
Principal Balance of the Subordinate Certificates, beginning with the Class of
Subordinate Certificates with the next highest payment priority, up to the
amount of such Realized Losses previously allocated to such Class of Subordinate
Certificates pursuant to this Section 5.04 and not previously reimbursed to such
Class of Subordinate Certificates with Net Monthly Excess Cashflow pursuant to
Section 5.01(c)(8)(iii). Holders of such Certificates will not be entitled to
any payment in respect of current interest on the amount of such increases for
any Interest Accrual Period preceding the Distribution Date on which such
increase occurs. Any such increases shall be applied to the Certificate
Principal Balance of each Subordinate Certificate of such Class in accordance
with its respective Percentage Interest.
(i) All Realized Losses on the Group IA Mortgage Loans shall be
allocated on each Distribution Date first, to REMIC I Regular Interest A-I until
the Uncertificated Balance of such REMIC I Regular Interest has been reduced to
zero and second, to REMIC I Regular Interest I-1-A through REMIC I Regular
Interest I-46-B, starting with the lowest numerical denomination until such
REMIC I Regular Interest has been reduced to zero, provided that, for REMIC I
Regular Interests with the same numerical denomination, such Realized Losses
shall be allocated PRO RATA between such REMIC I Regular Interests. All Realized
Losses on the Group IB Mortgage Loans shall be allocated on each Distribution
Date first, to REMIC I Regular Interest A-II until the Uncertificated Balance of
such REMIC I Regular Interest has been reduced to zero and second, to REMIC I
Regular Interest II-1-A through REMIC I Regular Interest II-46-B, starting with
the lowest numerical denomination until such REMIC I Regular Interest has been
reduced to zero, provided that, for REMIC I Regular Interests with the same
numerical denomination, such Realized Losses shall be allocated PRO RATA between
such REMIC I Regular Interests. All Realized Losses on the Group II Mortgage
Loans shall be allocated on each Distribution Date first, to REMIC I Regular
Interest A-III until the Uncertificated Balance of such REMIC I Regular Interest
has been reduced to zero and second, to REMIC I Regular Interest III-1-A through
REMIC I Regular Interest III-46-B, starting with the lowest numerical
denomination until such REMIC I Regular Interest has been reduced to zero,
provided that, for REMIC I Regular Interests with the same numerical
denomination, such Realized Losses shall be allocated PRO RATA between such
REMIC I Regular Interests.
(ii) The REMIC II Marker Allocation Percentage of all Realized Losses
on the Mortgage Loans shall be allocated by the Trustee, based solely on the
instructions of the Securities Administrator, on each Distribution Date to the
following REMIC II Regular Interests in the specified percentages, as follows:
first, to Uncertificated Interest payable to the REMIC II Regular Interest AA
and REMIC II Regular Interest ZZ up to an aggregate amount equal to the REMIC II
Interest Loss Allocation Amount, 98.00% and 2.00%, respectively; second, to the
Uncertificated Balances of the REMIC II Regular Interest AA and REMIC II Regular
Interest ZZ up to an aggregate amount equal to the REMIC II Principal Loss
Allocation Amount, 98.00% and 2.00%, respectively; third, to the Uncertificated
Balances of REMIC II Regular Interest AA, REMIC II Regular Interest M-11 and
REMIC II Regular Interest ZZ, 98.00%, 1.00% and 1.00%, respectively, until the
Uncertificated Balance of REMIC II Regular Interest M-11 has been reduced to
zero; fourth, to the Uncertificated Balances of REMIC II Regular Interest AA,
REMIC II Regular Interest M-10 and REMIC II Regular Interest ZZ, 98.00%, 1.00%
and 1.00%, respectively, until the Uncertificated Balance of REMIC II Regular
Interest M-10 has been reduced to zero; fifth, to the Uncertificated Balances of
REMIC II Regular Interest AA, REMIC II Regular Interest M-9 and REMIC II Regular
Interest ZZ, 98.00%, 1.00% and 1.00%, respectively, until the Uncertificated
Balance of REMIC II Regular Interest M-9 has been reduced to zero; sixth, to the
Uncertificated Balances of REMIC II Regular Interest AA, REMIC II Regular
Interest M-8 and REMIC II Regular Interest ZZ, 98.00%, 1.00% and 1.00%,
respectively, until the Uncertificated Balance of REMIC II Regular Interest M-8
has been reduced to zero; seventh, to the Uncertificated Balances of REMIC II
Regular Interest AA, REMIC II Regular Interest M-7 and REMIC II Regular Interest
ZZ, 98.00%, 1.00% and 1.00%, respectively, until the Uncertificated Balance of
REMIC II Regular Interest M-7 has been reduced to zero; eighth, to the
Uncertificated Balances of REMIC II Regular Interest AA, REMIC II Regular
Interest M-6 and REMIC II Regular Interest ZZ, 98.00%, 1.00% and 1.00%,
respectively, until the Uncertificated Balance of REMIC II Regular Interest M-6
has been reduced to zero; ninth, to the Uncertificated Balances of REMIC II
Regular Interest AA, REMIC II Regular Interest M-5 and REMIC II Regular Interest
ZZ, 98.00%, 1.00% and 1.00%, respectively, until the Uncertificated Balance of
REMIC II Regular Interest M-5 has been reduced to zero; tenth, to the
Uncertificated Balances of REMIC II Regular Interest AA, REMIC II Regular
Interest M-4 and REMIC II Regular Interest ZZ, 98.00%, 1.00% and 1.00%,
respectively, until the Uncertificated Balance of REMIC II Regular Interest M-4
has been reduced to zero; eleventh, to the Uncertificated Balances of REMIC II
Regular Interest AA, REMIC II Regular Interest M-3 and REMIC II Regular Interest
ZZ, 98.00%, 1.00% and 1.00%, respectively, until the Uncertificated Balance of
REMIC II Regular Interest M-3 has been reduced to zero; twelfth, to the
Uncertificated Balances of REMIC II Regular Interest AA, REMIC II Regular
Interest M-2 and REMIC II Regular Interest ZZ, 98.00%, 1.00% and 1.00%,
respectively, until the Uncertificated Balance of REMIC II Regular Interest M-2
has been reduced to zero; and thirteenth, to the Uncertificated Balances of
REMIC II Regular Interest AA, REMIC II Regular Interest M-1 and REMIC II Regular
Interest ZZ, 98.00%, 1.00% and 1.00%, respectively, until the Uncertificated
Balance of REMIC II Regular Interest M-1 has been reduced to zero.
(iii) The REMIC II Sub WAC Allocation Percentage of all Realized Losses
shall be applied after all distributions have been made on each Distribution
Date first, so as to keep the Uncertificated Balance of each REMIC II Regular
Interest ending with the designation "GRP" equal to 0.01% of the aggregate
Stated Principal Balance of the Mortgage Loans in the related loan group;
second, to each REMIC II Regular Interest ending with the designation "SUB," so
that the Uncertificated Balance of each such REMIC II Regular Interest is equal
to 0.01% of the excess of (x) the aggregate Stated Principal Balance of the
Mortgage Loans in the related loan group over (y) the current Certificate
Principal Balance of the Class A Certificate in the related loan group (except
that if any such excess is a larger number than in the preceding distribution
period, the least amount of Realized Losses shall be applied to such REMIC II
Regular Interests such that the REMIC II Subordinated Balance Ratio is
maintained); and third, any remaining Realized Losses shall be allocated to
REMIC II Regular Interest XX.
SECTION 5.05. Compliance with Withholding Requirements.
Notwithstanding any other provision of this Agreement, the Trustee and
the Securities Administrator shall comply with all federal withholding
requirements respecting payments to Certificateholders of interest or original
issue discount that the Trustee reasonably believes are applicable under the
Code. The consent of Certificateholders shall not be required for such
withholding. In the event the Securities Administrator does withhold any amount
from interest or original issue discount payments or advances thereof to any
Certificateholder pursuant to federal withholding requirements, the Securities
Administrator shall indicate the amount withheld to such Certificateholders.
SECTION 5.06. Reports Filed with Securities and Exchange Commission.
The Depositor shall prepare or cause to be prepared the initial current
report on Form 8-K. Within fifteen (15) days after each Distribution Date, the
Securities Administrator shall, in accordance with industry standards, file with
the Commission via the Electronic Data Gathering and Retrieval System ("▇▇▇▇▇"),
a Form 8-K (or other comparable Form containing the same or comparable
information or other information mutually agreed upon) with a copy of the
statement to be furnished to the Certificateholders for such Distribution Date
as an exhibit thereto. Prior to January 30, 2006, the Securities Administrator
shall, in accordance with industry standards, file a Form 15 Suspension Notice
with respect to the Trust Fund, if applicable. Prior to (i) March 20, 2006 and
(ii) unless and until a Form 15 Suspension Notice shall have been filed, prior
to March 20th of each year thereafter, the Master Servicer shall provide the
Securities Administrator with a Master Servicer Certification, together with a
copy of the annual independent accountant's servicing report and annual
statement of compliance of the Servicer to be delivered pursuant to this
Agreement or the Servicing Agreement, as applicable, and, if applicable, the
annual independent accountant's servicing report and annual statement of
compliance to be delivered by the Master Servicer pursuant to Sections 4.15 and
4.16. Prior to (i) March 31, 2006 and (ii) unless and until a Form 15 Suspension
Notice shall have been filed, March 31 of each year thereafter, the Securities
Administrator shall file a Form 10-K, in substance conforming to industry
standards, with respect to the Trust. Such Form 10-K shall include the Master
Servicer Certification and other documentation provided by the Master Servicer
pursuant to the second preceding sentence. The Depositor hereby grants to the
Securities Administrator a limited power of attorney to execute and file each
such document on behalf of the Depositor. Such power of attorney shall continue
until either the earlier of (i) receipt by the Securities Administrator from the
Depositor of written termination of such power of attorney and (ii) the
termination of the Trust Fund. The Depositor agrees to promptly furnish to the
Securities Administrator, from time to time upon request, such further
information, reports and financial statements within its control related to this
Agreement, the Mortgage Loans as the Securities Administrator reasonably deems
appropriate to prepare and file all necessary reports with the Commission. The
Securities Administrator shall have no responsibility to file any items other
than those specified in this Section 5.06; provided, however, the Securities
Administrator will cooperate with the Depositor in connection with any
additional filings with respect to the Trust Fund as the Depositor deems
necessary under the Exchange Act. Fees and expenses incurred by the Securities
Administrator in connection with this Section 5.06 shall not be reimbursable
from the Trust Fund.
SECTION 5.07. Supplemental Interest Trust.
(a) On the Closing Date, the Securities Administrator shall establish
and maintain in the name of the Trustee a separate account for the benefit of
the holders of the Offered Certificates (the "Supplemental Interest Trust"). The
Supplemental Interest Trust shall be an Eligible Account, and funds on deposit
therein shall be held separate and apart from, and shall not be commingled with,
any other moneys, including, without limitation, other moneys of the Trustee or
of the Securities Administrator held pursuant to this Agreement.
(b) On each Distribution Date, the Securities Administrator shall
withdraw all amounts which were deposited in the Supplemental Interest Trust as
specifically described in this Agreement and the Swap Agreement and distribute
such amounts in accordance with the provisions of Section 5.01(c) of this
Agreement.
(c) The Supplemental Interest Trust constitutes an "outside reserve
fund" within the meaning of Treasury Regulation ss. 1.860G-2(h) and is not an
asset of any REMIC. The Holders of the Class CE Certificates shall be the
beneficial owner of the Supplemental Interest Trust, subject to the power of the
Securities Administrator to transfer amounts under this Agreement. The
Securities Administrator shall keep records that accurately reflect the funds on
deposit in the Supplemental Interest Trust. The Securities Administrator shall,
at the written direction of the majority of the Class CE Certificateholders,
invest amounts on deposit in the Supplemental Interest Trust in Permitted
Investments. In the absence of written direction to the Securities Administrator
from the majority of the Class CE Certificateholders, all funds in the
Supplemental Interest Trust shall remain uninvested. On each Distribution Date,
the Securities Administrator shall distribute, not in respect of any REMIC, any
interest earned on the Supplemental Interest Trust to the Holders of the Class
CE Certificates.
(d) For federal income tax purposes, amounts paid to the Supplemental
Interest Trust on each Distribution Date pursuant to Section 5.01(c)(2), (3),
(4), (6) and (7) and Section 5.01(c)(8)(vii) shall first be deemed paid to the
Supplemental Interest Trust in respect of the Class IO Interest to the extent of
the amount distributable on such Class IO Interest on such Distribution Date,
and any remaining amount shall be deemed paid to the Supplemental Interest Trust
in respect of a Class IO Distribution Amount. For federal income tax purposes,
the Supplemental Interest Trust will be a disregarded entity.
(e) The Securities Administrator shall treat the Holders of
Certificates (other than the Class P, Class CE and Residual Certificates) as
having entered into a notional principal contract with respect to the Holders of
the Class CE Certificates. Pursuant to each such notional principal contract,
all Holders of Certificates (other than the Class P, Class CE and Residual
Certificates) shall be treated as having agreed to pay, on each Distribution
Date, to the Holder of the Class CE Certificates an aggregate amount equal to
the excess, if any, of (i) the amount payable on such Distribution Date on the
Regular Interest ownership of which is represented by such Class of Certificates
over (ii) the amount payable on such Class of Certificates on such Distribution
Date (such excess, a "Class IO Distribution Amount"). A Class IO Distribution
Amount payable from interest collections shall be allocated pro rata among such
Certificates based on the amount of interest otherwise payable to such
Certificates, and a Class IO Distribution Amount payable from principal
collections shall be allocated to the most subordinate Class of such
Certificates with an outstanding principal balance to the extent of such
balance. In addition, pursuant to such notional principal contract, the Holder
of the Class CE Certificates shall be treated as having agreed to pay Net WAC
Rate Carryover Amounts to the Holders of the Certificates (other than the Class
CE, Class P and Residual Certificates) in accordance with the terms of this
Agreement. Any payments to such Certificates from amounts deemed received in
respect of this notional principal contract shall not be payments with respect
to a Regular Interest in a REMIC within the meaning of Code Section 860G(a)(1).
However, any payment from the Certificates (other than the Class CE, Class P and
Residual Certificates) of a Class IO Distribution Amount shall be treated for
tax purposes as having been received by the Holders of such Certificates in
respect of the Regular Interest ownership of which is represented by such
Certificates, and as having been paid by such Holders to the Supplemental
Interest Trust pursuant to the notional principal contract. Thus, each
Certificate (other than the Class P Certificates and Residual Certificates)
shall be treated as representing not only ownership of a Regular Interest in
REMIC III, REMIC VII, REMIC VIII, REMIC IX, REMIC X, and REMIC XI, as
applicable, but also ownership of an interest in, and obligations with respect
to, a notional principal contract.
(f) For federal tax return and information reporting, the right of the
holders of the Offered Certificates to receive payments from the Supplemental
Interest Trust shall be assigned a value of [_______].
(g) In the event that the Swap Agreement is terminated prior to the
Distribution Date in September 2009, the Seller shall use reasonable efforts to
appoint a successor swap provider using any Swap Termination Payments paid by
the Swap Provider. If the Seller is unable to locate a qualified successor swap
provider, any such Swap Termination Payments will be remitted to the Securities
Administrator for payment to the holders of the Offered Certificates in
accordance with Section 5.01(c).
SECTION 5.08. Tax Treatment of Swap Payments and Swap Termination
Payments.
For federal income tax purposes, each holder of an Offered Certificate
is deemed to own an undivided beneficial ownership interest in a REMIC regular
interest and the right to receive payments from either the Reserve Fund or the
Supplemental Interest Trust in respect of any Net WAC Rate Carryover Amounts or
the obligation to make payments to the Supplemental Interest Trust. For federal
income tax purposes, the Securities Administrator will account for payments to
each Offered Certificate as follows: each Offered Certificate will be treated as
receiving their entire payment from REMIC III (regardless of any Swap
Termination Payment or obligation under the Swap Agreement) and subsequently
paying their portion of any Swap Termination Payment in respect of each such
Class's obligation under the Swap Agreement. In the event that any such Class is
resecuritized in a REMIC, the obligation under the Swap Agreement to pay any
such Swap Termination Payment (or any shortfall in Net Swap Payment), will be
made by one or more of the REMIC Regular Interests issued by the
resecuritization REMIC subsequent to such REMIC Regular Interest receiving its
full payment from any such Offered Certificate. Resecuritization of any Offered
Certificate in a REMIC will be permissible only if the Securities Administrator
hereunder is the trustee/securities administrator in such resecuritization.
The REMIC Regular Interest corresponding to an Offered Certificate will
be entitled to receive interest and principal payments at the times and in the
amounts equal to those made on the certificate to which it corresponds, except
that (i) the maximum interest rate of that REMIC regular interest will equal the
Net WAC Pass-Through Rate computed for this purpose by limiting the Swap
Notional Amount of the Swap Agreement to the aggregate Stated Principal Balance
of the Mortgage Loans and (ii) any Swap Termination Payment will be treated as
being payable solely from amounts otherwise payable to the Class CE
Certificates. As a result of the foregoing, the amount of distributions and
taxable income on the REMIC Regular Interest corresponding to an Offered
Certificate may exceed the actual amount of distributions on the Offered
Certificate.
ARTICLE VI
THE CERTIFICATES
SECTION 6.01. The Certificates.
(a) The Certificates in the aggregate will represent the entire
beneficial ownership interest in the Mortgage Loans and all other assets
included in REMIC I.
The Certificates will be substantially in the forms annexed hereto as
Exhibits A-1 through A-5. The Certificates of each Class will be issuable in
registered form only, in denominations of authorized Percentage Interests as
described in the definition thereof. Each Certificate will share ratably in all
rights of the related Class.
Upon original issue, the Certificates shall be executed and
authenticated by the Securities Administrator and delivered by the Trustee to
and upon the written order of the Depositor. The Certificates shall be executed
by manual or facsimile signature on behalf of the Trust by the Securities
Administrator by an authorized signatory. Certificates bearing the manual or
facsimile signatures of individuals who were at any time the proper officers of
the Securities Administrator shall bind the Trust, notwithstanding that such
individuals or any of them have ceased to hold such offices prior to the
authentication and delivery of such Certificates or did not hold such offices at
the date of such Certificates. No Certificate shall be entitled to any benefit
under this Agreement or be valid for any purpose, unless there appears on such
Certificate a certificate of authentication substantially in the form provided
herein executed by the Securities Administrator by manual signature, and such
certificate of authentication shall be conclusive evidence, and the only
evidence, that such Certificate has been duly authenticated and delivered
hereunder. All Certificates shall be dated the date of their authentication.
(b) The Class A Certificates and the Mezzanine Certificates shall
initially be issued as one or more Certificates held by the Book-Entry Custodian
or, if appointed to hold such Certificates as provided below, the Depository and
registered in the name of the Depository or its nominee and, except as provided
below, registration of such Certificates may not be transferred by the
Securities Administrator except to another Depository that agrees to hold such
Certificates for the respective Certificate Owners with Ownership Interests
therein. The Certificate Owners shall hold their respective Ownership Interests
in and to such Certificates through the book-entry facilities of the Depository
and, except as provided below, shall not be entitled to definitive, fully
registered Certificates ("Definitive Certificates") in respect of such Ownership
Interests. All transfers by Certificate Owners of their respective Ownership
Interests in the Book-Entry Certificates shall be made in accordance with the
procedures established by the Depository Participant or brokerage firm
representing such Certificate Owner. Each Depository Participant shall only
transfer the Ownership Interests in the Book-Entry Certificates of Certificate
Owners it represents or of brokerage firms for which it acts as agent in
accordance with the Depository's normal procedures. The Securities Administrator
is hereby initially appointed as the Book-Entry Custodian and hereby agrees to
act as such in accordance herewith and in accordance with the agreement that it
has with the Depository authorizing it to act as such. The Book-Entry Custodian
may, and, if it is no longer qualified to act as such, the Book-Entry Custodian
shall, appoint, by a written instrument delivered to the Depositor, the
Servicers and, if the Trustee is not the Book-Entry Custodian, the Trustee, any
other transfer agent (including the Depository or any successor Depository) to
act as Book-Entry Custodian under such conditions as the predecessor Book-Entry
Custodian and the Depository or any successor Depository may prescribe, provided
that the predecessor Book-Entry Custodian shall not be relieved of any of its
duties or responsibilities by reason of any such appointment of other than the
Depository. If the Securities Administrator resigns or is removed in accordance
with the terms hereof, the successor Securities Administrator or, if it so
elects, the Depository shall immediately succeed to its predecessor's duties as
Book-Entry Custodian. The Depositor shall have the right to inspect, and to
obtain copies of, any Certificates held as Book-Entry Certificates by the
Book-Entry Custodian.
(c) The Class CE Certificates and Class P Certificates offered and sold
to QIBs in reliance on Rule 144A under the Securities Act ("Rule 144A") will be
issued in the form of Definitive Certificates.
(d) The Trustee, the Servicers, the Securities Administrator, the
Master Servicer and the Depositor may for all purposes (including the making of
payments due on the Book-Entry Certificates and Global Certificates) deal with
the Depository as the authorized representative of the Certificate Owners with
respect to the Book-Entry Certificates and Global Certificates for the purposes
of exercising the rights of Certificateholders hereunder. The rights of
Certificate Owners with respect to the Book-Entry Certificates and Global
Certificates shall be limited to those established by law and agreements between
such Certificate Owners and the Depository Participants and brokerage firms
representing such Certificate Owners. Multiple requests and directions from, and
votes of, the Depository as Holder of the Book-Entry Certificates and Global
Certificates with respect to any particular matter shall not be deemed
inconsistent if they are made with respect to different Certificate Owners. The
Securities Administrator may establish a reasonable record date in connection
with solicitations of consents from or voting by Certificateholders and shall
give notice to the Depository of such record date.
If (i)(A) the Depositor advises the Securities Administrator in writing
that the Depository is no longer willing or able to properly discharge its
responsibilities as Depository, and (B) the Depositor is unable to locate a
qualified successor, (ii) the Depositor at its option advises the Securities
Administrator in writing that it elects to terminate the book-entry system
through the Depository or (iii) after the occurrence of a Servicer Event of
Default, Certificate Owners representing in the aggregate not less than 51% of
the Ownership Interests of the Book-Entry Certificates advise the Securities
Administrator through the Depository, in writing, that the continuation of a
book-entry system through the Depository is no longer in the best interests of
the Certificate Owners, the Securities Administrator shall notify all
Certificate Owners, through the Depository, of the occurrence of any such event
and of the availability of Definitive Certificates to Certificate Owners
requesting the same. With respect to a Global Certificate, the related
Certificate Owner (other than a Holder of a Regulation S Temporary Global
Certificate) may request that its interest in a Global Certificate be exchanged
for a Definitive Certificate. Upon surrender to the Securities Administrator of
the Book-Entry Certificates by the Book-Entry Custodian or the Depository, as
applicable, or the Global Certificates by the Depository accompanied by
registration instructions from the Depository for registration of transfer, the
Securities Administrator shall cause the Definitive Certificates to be issued.
Such Definitive Certificates will be issued in minimum denominations of 10,000
except that any beneficial ownership that was represented by a Book-Entry
Certificate, or a Global Certificate, as applicable in an amount less than
10,000 immediately prior to the issuance of a Definitive Certificate shall be
issued in a minimum denomination equal to the amount represented by such
Book-Entry Certificate or a Global Certificate, as applicable. None of the
Depositor, the Servicers, the Master Servicer, the Securities Administrator or
the Trustee shall be liable for any delay in the 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 Depository shall be deemed
to be imposed upon and performed by the Securities Administrator, to the extent
applicable with respect to such Definitive Certificates, and the Securities
Administrator shall recognize the Holders of the Definitive Certificates as
Certificateholders hereunder.
SECTION 6.02. Registration of Transfer and Exchange of Certificates.
(a) The Securities Administrator shall cause to be kept at one of the
offices or agencies to be appointed by the Securities Administrator in
accordance with the provisions of Section 9.11, a Certificate Register for the
Certificates in which, subject to such reasonable regulations as it may
prescribe, the Securities Administrator shall provide for the registration of
Certificates and of transfers and exchanges of Certificates as herein provided.
(b) No transfer of any Class CE Certificate, Class P Certificate or
Residual Certificate shall be made unless that transfer is made pursuant to an
effective registration statement under the Securities Act, and effective
registration or qualification under applicable state securities laws, or is made
in a transaction that does not require such registration or qualification. In
the event that such a transfer of a Class CE Certificate, Class P Certificate or
Residual Certificate is to be made without registration or qualification (other
than in connection with the initial transfer of any such Certificate by the
Depositor), the Securities Administrator shall require receipt of: (i) if such
transfer is purportedly being made in reliance upon Rule 144A under the
Securities Act, written certifications from the Certificateholder desiring to
effect the transfer and from such Certificateholder's prospective transferee,
substantially in the form attached hereto as Exhibit B-1; (ii) if such transfer
is purportedly being made in reliance upon Rule 501(a) under the Securities Act,
written certifications from the Certificateholder desiring to effect the
transfer and from such Certificateholder's prospective transferee, substantially
in the form attached hereto as Exhibit B-2 and (iii) in all other cases, an
Opinion of Counsel satisfactory to the Securities Administrator that such
transfer may be made without such registration or qualification (which Opinion
of Counsel shall not be an expense of the Trust Fund or of the Depositor, the
Trustee, the Master Servicer, the Securities Administrator or the Servicers),
together with copies of the written certification(s) of the Certificateholder
desiring to effect the transfer and/or such Certificateholder's prospective
transferee upon which such Opinion of Counsel is based, if any. Neither of the
Depositor nor the Securities Administrator is obligated to register or qualify
any such Certificates under the Securities Act or any other securities laws or
to take any action not otherwise required under this Agreement to permit the
transfer of such Certificates without registration or qualification. Any
Certificateholder desiring to effect the transfer of any such Certificate shall,
and does hereby agree to, indemnify the Trustee, the Depositor, the Master
Servicer, the Securities Administrator and the Servicers against any liability
that may result if the transfer is not so exempt or is not made in accordance
with such federal and state laws.
(c) No transfer of a Class CE Certificate, Class P Certificate or a
Residual Certificate or any interest therein shall be made to any Plan subject
to ERISA or Section 4975 of the Code, any Person acting, directly or indirectly,
on behalf of any such Plan or any Person acquiring such Certificates with "Plan
Assets" of a Plan within the meaning of the Department of Labor regulation
promulgated at 29 C.F.R. ss. 2510.3-101 ("Plan Assets") unless the Securities
Administrator is provided with an Opinion of Counsel on which the Depositor, the
Master Servicer, the Securities Administrator, the Trustee and the Servicers may
rely, which establishes to the satisfaction of the Securities Administrator that
the purchase of such Certificates is permissible under applicable law, will not
constitute or result in any prohibited transaction under ERISA or Section 4975
of the Code and will not subject the Depositor, the Servicers, the Trustee, the
Master Servicer, the Securities Administrator or the Trust Fund to any
obligation or liability (including obligations or liabilities under ERISA or
Section 4975 of the Code) in addition to those undertaken in this Agreement,
which Opinion of Counsel shall not be an expense of the Depositor, the
Servicers, the Trustee, the Master Servicer, the Securities Administrator, the
Trust Fund. An Opinion of Counsel will not be required in connection with the
initial transfer of any such Certificate by the Depositor to an affiliate of the
Depositor (in which case, the Depositor or any affiliate thereof shall have
deemed to have represented that such affiliate is not a Plan or a Person
investing Plan Assets) and the Securities Administrator shall be entitled to
conclusively rely upon a representation (which, upon the request of the
Securities Administrator, shall be a written representation) from the Depositor
of the status of such transferee as an affiliate of the Depositor.
For so long as the Supplemental Interest Trust is in existence, each
beneficial owner of a Offered Certificate or any interest therein, shall be
deemed to have represented, by virtue of its acquisition or holding of the
Offered Certificate, or interest therein, that either (i) it is not a Plan or
(ii)(A) it is an accredited investor within the meaning of Prohibited
Transaction Exemption 2002-41, as amended from time to time (the "Exemption")
and (B) the acquisition and holding of such Certificate and the separate right
to receive payments from the Supplemental Interest Trust are eligible for the
exemptive relief available under Prohibited Transaction Class Exemption ("PTCE")
84-14 (for transactions by independent "qualified professional asset managers"),
91-38 (for transactions by bank collective investment funds), 90-1 (for
transactions by insurance company pooled separate accounts), 95-60 (for
transactions by insurance company general accounts) or 96-23 (for transactions
effected by "in-house asset managers").
Each Transferee of a Mezzanine Certificate or any interest therein that
is acquired after the termination of the Supplemental Interest Trust will be
deemed to have represented by virtue of its purchase or holding of such
Certificate (or interest therein) that either (a) such Transferee is not a Plan
or purchasing such Certificate with Plan Assets, (b) it has acquired and is
holding such Certificate in reliance on Prohibited Transaction Exemption ("PTE")
94-84 or FAN 97-03E, as amended by PTE 97-34, 62 Fed. Reg. 39021 (July 21,
1997), PTE 2000-58, 65 Fed. Reg. 67765 (November 13, 2000) and PTE 2002-41, 67
Fed. Reg. 54487 (August 22, 2002) (the "Exemption"), and that it understands
that there are certain conditions to the availability of the Exemption including
that such Certificate must be rated, at the time of purchase, not lower than
"BBB-" (or its equivalent) by a Rating Agency or (c) the following conditions
are satisfied: (i) such Transferee is an insurance company, (ii) the source of
funds used to purchase or hold such Certificate (or interest therein) is an
"insurance company general account" (as defined in PTCE 95-60, and (iii) the
conditions set forth in Sections I and III of PTCE 95-60 have been satisfied.
If any Certificate or any interest therein is acquired or held in
violation of the conditions described in this Section 6.02(c), the next
preceding permitted beneficial owner will be treated as the beneficial owner of
that Certificate, retroactive to the date of transfer to the purported
beneficial owner. Any purported beneficial owner whose acquisition or holding of
any certificate or interest therein was effected in violation of the conditions
described in this Section 6.02(c) shall indemnify and hold harmless the
Depositor, the Trustee, the Servicers, the Master Servicer, the Securities
Administrator and the Trust Fund from and against any and all liabilities,
claims, costs or expenses incurred by those parties as a result of that
acquisition or holding.
(d) (i) Each Person who has or who acquires any Ownership Interest in a
Residual Certificate shall be deemed by the acceptance or acquisition of such
Ownership Interest to have agreed to be bound by the following provisions and to
have irrevocably authorized the Securities Administrator or its designee under
clause (iii)(A) below to deliver payments to a Person other than such Person and
to negotiate the terms of any mandatory sale under clause (iii)(B) below and to
execute all instruments of Transfer and to do all other things necessary in
connection with any such sale. The rights of each Person acquiring any Ownership
Interest in a Residual Certificate are expressly subject to the following
provisions:
(A) Each Person holding or acquiring any Ownership Interest in
a Residual Certificate shall be a Permitted Transferee and shall
promptly notify the Securities Administrator of any change or impending
change in its status as a Permitted Transferee.
(B) In connection with any proposed Transfer of any Ownership
Interest in a Residual Certificate, the Securities Administrator shall
require delivery to it, and shall not register the Transfer of any
Residual Certificate until its receipt of, an affidavit and agreement
(a "Transfer Affidavit and Agreement," in the form attached hereto as
Exhibit B-3) from the proposed Transferee, in form and substance
satisfactory to the Securities Administrator, representing and
warranting, among other things, that such Transferee is a Permitted
Transferee, that it is not acquiring its Ownership Interest in the
Residual Certificate that is the subject of the proposed Transfer as a
nominee, trustee or agent for any Person that is not a Permitted
Transferee, that for so long as it retains its Ownership Interest in a
Residual Certificate, it will endeavor to remain a Permitted
Transferee, and that it has reviewed the provisions of this Section
6.02(d) and agrees to be bound by them. (C) Notwithstanding the
delivery of a Transfer Affidavit and Agreement by a proposed Transferee
under clause (B) above, if an authorized officer of the Securities
Administrator who is assigned to this transaction has actual knowledge
that the proposed Transferee is not a Permitted Transferee, no Transfer
of an Ownership Interest in a Residual Certificate to such proposed
Transferee shall be effected.
(D) Each Person holding or acquiring any Ownership Interest in
a Residual Certificate shall agree (x) to require a Transfer Affidavit
and Agreement from any other Person to whom such Person attempts to
transfer its Ownership Interest in a Residual Certificate and (Y) not
to transfer its Ownership Interest unless it provides a Transferor
Affidavit (in the form attached hereto as Exhibit B-2) to the
Securities Administrator stating that, among other things, it has no
actual knowledge that such other Person is not a Permitted Transferee.
(E) Each Person holding or acquiring an Ownership Interest in
a Residual Certificate, by purchasing an Ownership Interest in such
Certificate, agrees to give the Securities Administrator written notice
that it is a "pass-through interest holder" within the meaning of
temporary Treasury regulation Section 1.67-3T(a)(2)(i)(A) immediately
upon acquiring an Ownership Interest in a Residual Certificate, if it
is, or is holding an Ownership Interest in a Residual Certificate on
behalf of, a "pass-through interest holder."
(ii) The Securities Administrator will register the Transfer
of any Residual Certificate only if it shall have received the Transfer
Affidavit and Agreement and all of such other documents as shall have
been reasonably required by the Securities Administrator as a condition
to such registration. In addition, no Transfer of a Residual
Certificate shall be made unless the Securities Administrator shall
have received a representation letter from the Transferee of such
Certificate to the effect that such Transferee is a Permitted
Transferee.
(iii) (A) If any purported Transferee shall become a Holder of
a Residual Certificate in violation of the provisions of this Section
6.02(d), then the last preceding Permitted Transferee shall be
restored, to the extent permitted by law, to all rights as holder
thereof retroactive to the date of registration of such Transfer of
such Residual Certificate. The Securities Administrator shall be under
no liability to any Person for any registration of Transfer of a
Residual Certificate that is in fact not permitted by this Section
6.02(d) or for making any payments due on such Certificate to the
holder thereof or for taking any other action with respect to such
holder under the provisions of this Agreement.
(B) If any purported Transferee shall become a holder of a
Residual Certificate in violation of the restrictions in this Section
6.02(d) and to the extent that the retroactive restoration of the
rights of the holder of such Residual Certificate as described in
clause (iii)(A) above shall be invalid, illegal or unenforceable, then
the Securities Administrator shall have the right, without notice to
the holder or any prior holder of such Residual Certificate, to sell
such Residual Certificate to a purchaser selected by the Securities
Administrator on such terms as the Securities Administrator may choose.
Such purported Transferee shall promptly endorse and deliver each
Residual Certificate in accordance with the instructions of the
Securities Administrator. Such purchaser may be the Securities
Administrator itself or any Affiliate of the Securities Administrator.
The proceeds of such sale, net of the commissions (which may include
commissions payable to the Securities Administrator or its Affiliates),
expenses and taxes due, if any, will be remitted by the Securities
Administrator to such purported Transferee. The terms and conditions of
any sale under this clause (iii)(B) shall be determined in the sole
discretion of the Securities Administrator, and the Securities
Administrator shall not be liable to any Person having an Ownership
Interest in a Residual Certificate as a result of its exercise of such
discretion.
(iv) The Securities Administrator shall make available to the
Internal Revenue Service and those Persons specified by the REMIC
Provisions all information necessary to compute any tax imposed (A) as
a result of the Transfer of an Ownership Interest in a Residual
Certificate to any Person who is a Disqualified Organization, including
the information described in Treasury regulations sections
1.860D-1(b)(5) and 1.860E-2(a)(5) with respect to the "excess
inclusions" of such Residual Certificate and (B) as a result of any
regulated investment company, real estate investment trust, common
trust fund, partnership, trust, estate or organization described in
Section 1381 of the Code that holds an Ownership Interest in a Residual
Certificate having as among its record holders at any time any Person
which is a Disqualified Organization. Reasonable compensation for
providing such information may be charged or collected by the
Securities Administrator.
(v) The provisions of this Section 6.02(d) set forth prior to
this subsection (v) may be modified, added to or eliminated, provided
that there shall have been delivered to the Securities Administrator at
the expense of the party seeking to modify, add to or eliminate any
such provision the following:
(A) written notification from each Rating Agency to the effect
that the modification, addition to or elimination of such provisions
will not cause such Rating Agency to downgrade its then-current ratings
of any Class of Certificates; and
(B) an Opinion of Counsel, in form and substance satisfactory
to the Securities Administrator, to the effect that such modification
of, addition to or elimination of such provisions will not cause any
Trust REMIC to cease to qualify as a REMIC and will not cause any Trust
REMIC, as the case may be, to be subject to an entity-level tax caused
by the Transfer of any Residual Certificate to a Person that is not a
Permitted Transferee or a Person other than the prospective transferee
to be subject to a REMIC-tax caused by the Transfer of a Residual
Certificate to a Person that is not a Permitted Transferee.
(e) Subject to the preceding subsections, upon surrender for
registration of transfer of any Certificate at any office or agency of the
Securities Administrator maintained for such purpose pursuant to Section 9.11,
the Securities Administrator shall execute, authenticate and deliver, in the
name of the designated Transferee or Transferees, one or more new Certificates
of the same Class of a like aggregate Percentage Interest.
(f) At the option of the Holder thereof, any Certificate may be
exchanged for other Certificates of the same Class with authorized denominations
and a like aggregate Percentage Interest, upon surrender of such Certificate to
be exchanged at any office or agency of the Securities Administrator maintained
for such purpose pursuant to Section 9.11. Whenever any Certificates are so
surrendered for exchange, the Securities Administrator shall execute,
authenticate and deliver, the Certificates which the Certificateholder making
the exchange is entitled to receive. Every Certificate presented or surrendered
for transfer or exchange shall (if so required by the Securities Administrator)
be duly endorsed by, or be accompanied by a written instrument of transfer in
the form satisfactory to the Securities Administrator duly executed by, the
Holder thereof or his attorney duly authorized in writing. In addition, with
respect to each Class R Certificate, the holder thereof may exchange, in the
manner described above, such Class R Certificate for three separate
certificates, each representing such holder's respective Percentage Interest in
the Class R-I Interest, the Class R-II Interest and the Class R-III Interest,
respectively, in each case that was evidenced by the Class R Certificate being
exchanged.
(g) No service charge to the Certificateholders shall be made for any
transfer or exchange of Certificates, but the Securities Administrator may
require payment of a sum sufficient to cover any tax or governmental charge that
may be imposed in connection with any transfer or exchange of Certificates.
(h) All Certificates surrendered for transfer and exchange shall be
canceled and destroyed by the Securities Administrator in accordance with its
customary procedures.
SECTION 6.03. Mutilated, Destroyed, Lost or Stolen Certificates.
If (i) any mutilated Certificate is surrendered to the Securities
Administrator, or the Securities Administrator receives evidence to its
satisfaction of the destruction, loss or theft of any Certificate and of the
ownership thereof, and (ii) there is delivered to the Securities Administrator
such security or indemnity as may be required by it to save it harmless, then,
in the absence of actual knowledge by the Securities Administrator that such
Certificate has been acquired by a protected purchaser, the Securities
Administrator, shall execute, authenticate and deliver, in exchange for or in
lieu of any such mutilated, destroyed, lost or stolen Certificate, a new
Certificate of the same Class and of like denomination and Percentage Interest.
Upon the issuance of any new Certificate under this Section, the Securities
Administrator may require the payment of a sum sufficient to cover any tax or
other governmental charge that may be imposed in relation thereto and any other
expenses (including the fees and expenses of the Securities Administrator)
connected therewith. Any replacement Certificate issued pursuant to this Section
shall constitute complete and indefeasible evidence of ownership in the
applicable REMIC created hereunder, as if originally issued, whether or not the
lost, stolen or destroyed Certificate shall be found at any time.
SECTION 6.04. Persons Deemed Owners.
The Depositor, the Servicers, the Trustee, the Master Servicer, the
Securities Administrator and any agent of any of them may treat the Person in
whose name any Certificate is registered as the owner of such Certificate for
the purpose of receiving distributions pursuant to Section 4.01 and for all
other purposes whatsoever, and none of the Depositor, the Servicers, the
Trustee, the Master Servicer, the Securities Administrator or any agent of any
of them shall be affected by notice to the contrary.
SECTION 6.05. Certain Available Information.
On or prior to the date of the first sale of any Class CE Certificate,
Class P Certificate or Residual Certificate to an Independent third party, the
Depositor shall provide to the Securities Administrator ten copies of any
private placement memorandum or other disclosure document used by the Depositor
in connection with the offer and sale of such Certificate. In addition, if any
such private placement memorandum or disclosure document is revised, amended or
supplemented at any time following the delivery thereof to the Securities
Administrator, the Depositor promptly shall inform the Securities Administrator
of such event and shall deliver to the Securities Administrator ten copies of
the private placement memorandum or disclosure document, as revised, amended or
supplemented. The Securities Administrator shall maintain at its office as set
forth in Section 12.05 hereof and shall make available free of charge during
normal business hours for review by any Holder of a Certificate or any Person
identified to the Securities Administrator as a prospective transferee of a
Certificate, originals or copies of the following items: (i) in the case of a
Holder or prospective transferee of a Class CE Certificate, Class P Certificate
or Residual Certificate, the related private placement memorandum or other
disclosure document relating to such Class of Certificates, in the form most
recently provided to the Securities Administrator; and (ii) in all cases, (A)
this Agreement and any amendments hereof entered into pursuant to Section 11.01,
(B) all monthly statements required to be delivered to Certificateholders of the
relevant Class pursuant to Section 4.02 since the Closing Date, and all other
notices, reports, statements and written communications delivered to the
Certificateholders of the relevant Class pursuant to this Agreement since the
Closing Date and (C) any copies of all Officers' Certificates of the Servicers
since the Closing Date delivered to the Master Servicer to evidence such
Person's determination that any P&I Advance or Servicing Advance was, or if
made, would be a Nonrecoverable P&I Advance or Nonrecoverable Servicing Advance.
Copies and mailing of any and all of the foregoing items will be available from
the Securities Administrator upon request at the expense of the Person
requesting the same.
ARTICLE VII
THE DEPOSITOR, THE SERVICERS AND THE MASTER SERVICER
SECTION 7.01. Liability of the Depositor, the Servicers and the Master
Servicer.
The Depositor, ▇▇▇▇▇ Fargo and the Master Servicer each shall be liable
in accordance herewith only to the extent of the obligations specifically
imposed by this Agreement upon them in their respective capacities as Depositor,
a Servicer and Master Servicer and undertaken hereunder by the Depositor, ▇▇▇▇▇
Fargo and the Master Servicer herein.
SECTION 7.02. Merger or Consolidation of the Depositor, the Servicers
or the Master Servicer.
Subject to the following paragraph, the Depositor will keep in full
effect its existence, rights and franchises as a corporation under the laws of
the jurisdiction of its incorporation. Subject to the following paragraph, ▇▇▇▇▇
Fargo will keep in full effect its existence, rights and franchises as a
national banking association. Subject to the following paragraph, the Master
Servicer will keep in full effect its existence, rights and franchises as a
national banking association. The Depositor, ▇▇▇▇▇ Fargo and the Master Servicer
each will obtain and preserve its qualification to do business as a foreign
entity in each jurisdiction in which such qualification is or shall be necessary
to protect the validity and enforceability of this Agreement, the Certificates
or any of the Mortgage Loans and to perform its respective duties under this
Agreement.
The Depositor, ▇▇▇▇▇ Fargo or the Master Servicer may be merged or
consolidated with or into any Person, or transfer all or substantially all of
its assets to any Person, in which case any Person resulting from any merger or
consolidation to which the Depositor, a Servicer or the Master Servicer shall be
a party, or any Person succeeding to the business of the Depositor, such
Servicer or the Master Servicer, shall be the successor of the Depositor, such
Servicer or the Master Servicer, as the case may be, hereunder, without the
execution or filing of any paper or any further act on the part of any of the
parties hereto, anything herein to the contrary notwithstanding; provided,
however, that any successor to a Servicer or the Master Servicer shall meet the
eligibility requirements set forth in Section 8.02(a) or Section 7.06 of this
Agreement or the Servicing Agreement, as applicable.
SECTION 7.03. Limitation on Liability of the Depositor, the Servicers,
the Master Servicer and Others.
None of the Depositor, the Servicers, the Securities Administrator, the
Master Servicers or any of the directors, officers, employees or agents of the
Depositor, the Servicer or the Master Servicer shall be under any liability to
the Trust Fund or the Certificateholders for any action taken or for refraining
from the taking of any action in good faith pursuant to this Agreement or the
Servicing Agreement, as applicable, or for errors in judgment; provided,
however, that this provision shall not protect the Depositor, a Servicer, the
Securities Administrator, the Master Servicer or any such person against any
breach of warranties, representations or covenants made herein or against any
specific liability imposed on any such Person pursuant hereto or against any
liability which would otherwise be imposed by reason of willful misfeasance, bad
faith or gross negligence in the performance of duties or by reason of reckless
disregard of obligations and duties hereunder or under the Servicing Agreement,
as applicable. The Depositor, each Servicer, the Securities Administrator, the
Master Servicer and any director, officer, employee or agent of the Depositor,
the related Servicer, the Securities Administrator and the Master Servicer may
rely in good faith on any document of any kind which, prima facie, is properly
executed and submitted by any Person respecting any matters arising hereunder.
The Depositor, the related Servicer, the Securities Administrator, the Master
Servicer and any director, officer, employee or agent of the Depositor, each
Servicer, the Securities Administrator or the Master Servicer shall be
indemnified and held harmless by the Trust Fund against any loss, liability or
expense incurred in connection with any legal action relating to this Agreement,
the Servicing Agreement, the Certificates or any Credit Risk Management
Agreement or any loss, liability or expense incurred other than by reason of
willful misfeasance, bad faith or gross negligence in the performance of duties
hereunder or under the Servicing Agreement or by reason of reckless disregard of
obligations and duties hereunder or under the Servicing Agreement. None of the
Depositor, any Servicer, the Securities Administrator or the Master Servicer
shall be under any obligation to appear in, prosecute or defend any legal action
unless such action is related to its respective duties under this Agreement and,
in its opinion, does not involve it in any expense or liability; provided,
however, that each of the Depositor, each Servicer, the Securities Administrator
and the Master Servicer may in its discretion undertake any such action which it
may deem necessary or desirable with respect to this Agreement and the rights
and duties of the parties hereto and the interests of the Certificateholders
hereunder. In such event, the legal expenses and costs of such action and any
liability resulting therefrom (except any loss, liability or expense incurred by
reason of willful misfeasance, bad faith or gross negligence in the performance
of duties hereunder or by reason of reckless disregard of obligations and duties
hereunder) shall be expenses, costs and liabilities of the Trust Fund, and the
Depositor, the related Servicer, the Securities Administrator and the Master
Servicer shall be entitled to be reimbursed therefor from the Collection
Account, the Custodial Account or the Distribution Account as and to the extent
provided in Article III and Article IV, any such right of reimbursement being
prior to the rights of the Certificateholders to receive any amount in the
Collection Account, the Custodial Account and the Distribution Account.
Notwithstanding anything to the contrary contained herein, no Servicer
shall be liable for any actions or inactions prior to the Cut-off Date of any
prior servicer of the related Mortgage Loans and the Master Servicer shall not
be liable for any action or inaction of any Servicer, except to the extent
expressly provided herein, or the Credit Risk Management Agreement.
SECTION 7.04. Limitation on Resignation of the Servicers.
(a) Except as expressly provided herein, no Servicer shall neither
assign all or substantially all of its rights under this Agreement or the
servicing hereunder nor delegate all or substantially all of its duties
hereunder nor sell or otherwise dispose of all or substantially all of its
property or assets without, in each case, the prior written consent of the
Trustee, which consent shall not be unreasonably withheld; provided, that in
each case, there must be delivered to the Trustee and the Master Servicer a
letter from each Rating Agency to the effect that such transfer of servicing or
sale or disposition of assets will not result in a qualification, withdrawal or
downgrade of the then-current rating of any of the Certificates. Notwithstanding
the foregoing, the Servicer, without the consent of the Trustee or the Master
Servicer, may retain third-party contractors to perform certain servicing and
loan administration functions, including without limitation hazard insurance
administration, tax payment and administration, flood certification and
administration, collection services and similar functions, provided, however,
that the retention of such contractors by the Servicer shall not limit the
obligation of the Servicer to service the related Mortgage Loans pursuant to the
terms and conditions of this Agreement. The Servicer shall not resign from the
obligations and duties hereby imposed on it except by consent of the Trustee or
upon determination that its duties hereunder are no longer permissible under
applicable law. Any such determination pursuant to the preceding sentence
permitting the resignation of a Servicer shall be evidenced by an Opinion of
Counsel to such effect obtained at the expense of such Servicer and delivered to
the Trustee and the Rating Agencies. No resignation of a Servicer shall become
effective until the Trustee or a successor servicer shall have assumed such
Servicer's responsibilities, duties, liabilities (other than those liabilities
arising prior to the appointment of such successor) and obligations under this
Agreement.
(i) Except as expressly provided herein, no Servicer shall
assign or transfer any of its rights, benefits or privileges hereunder
to any other Person, or delegate to or subcontract with, or authorize
or appoint any other Person to perform any of the duties, covenants or
obligations to be performed by such Servicer hereunder. The foregoing
prohibition on assignment shall not prohibit a Servicer from
designating a Sub-Servicer as payee of any indemnification amount
payable to the Servicer hereunder; provided, however, that as provided
in Section 3.02, no Sub-Servicer shall be a third-party beneficiary
hereunder and the parties hereto shall not be required to recognize any
Sub-Servicer as an indemnitee under this Agreement.
SECTION 7.05. Limitation on Resignation of the Master Servicer.
The Master Servicer shall not resign from the obligations and duties
hereby imposed on it except upon determination that its duties hereunder are no
longer permissible under applicable law. Any such determination pursuant to the
preceding sentence permitting the resignation of the Master Servicer shall be
evidenced by an Opinion of Counsel to such effect obtained at the expense of the
Master Servicer and delivered to the Trustee and the Rating Agencies. No
resignation of the Master Servicer shall become effective until the Trustee or a
successor Master Servicer meeting the criteria specified in Section 7.06 shall
have assumed the Master Servicer's responsibilities, duties, liabilities (other
than those liabilities arising prior to the appointment of such successor) and
obligations under this Agreement.
SECTION 7.06. Assignment of Master Servicing.
The Master Servicer may sell and assign its rights and delegate its
duties and obligations in its entirety as Master Servicer under this Agreement;
provided, however, that: (i) the purchaser or transferee accept in writing such
assignment and delegation and assume the obligations of the Master Servicer
hereunder (a) shall have a net worth of not less than 25,000,000 (unless
otherwise approved by each Rating Agency pursuant to clause (ii) below); (b)
shall be reasonably satisfactory to the Trustee (as evidenced in a writing
signed by the Trustee); and (c) shall execute and deliver to the Trustee an
agreement, in form and substance reasonably satisfactory to the Trustee, which
contains an assumption by such Person of the due and punctual performance and
observance of each covenant and condition to be performed or observed by it as
master servicer under this Agreement, any custodial agreement from and after the
effective date of such agreement; (ii) each Rating Agency shall be given prior
written notice of the identity of the proposed successor to the Master Servicer
and each Rating Agency's rating of the Certificates in effect immediately prior
to such assignment, sale and delegation will not be downgraded, qualified or
withdrawn as a result of such assignment, sale and delegation, as evidenced by a
letter to such effect delivered to the Master Servicer and the Trustee; and
(iii) the Master Servicer assigning and selling the master servicing shall
deliver to the Trustee an Officer's Certificate and an Opinion of Independent
counsel, each stating that all conditions precedent to such action under this
Agreement have been completed and such action is permitted by and complies with
the terms of this Agreement. No such assignment or delegation shall affect any
liability of the Master Servicer arising out of acts or omissions prior to the
effective date thereof.
SECTION 7.07. Rights of the Depositor in Respect of the Servicers and
the Master Servicer.
Each of the Master Servicer and any Servicer that is a party hereto
shall afford (and any Sub-Servicing Agreement shall provide that each
Sub-Servicer shall afford) the Depositor and the Trustee, upon reasonable
notice, during normal business hours, access to all records maintained by the
Master Servicer or the related Servicer (and any such Sub-Servicer) in respect
of the related Servicer's rights and obligations hereunder and access to
officers of the Master Servicer or such Servicer (and those of any such
Sub-Servicer) responsible for such obligations, and the Master Servicer shall
have access to all such records maintained by such Servicer and any
Sub-Servicers. Upon request, each of the Master Servicer and such Servicer shall
furnish to the Depositor and the Trustee its (and any such Sub-Servicer's) most
recent financial statements and such other information relating to the Master
Servicer's or such Servicer's capacity to perform its obligations under this
Agreement as it possesses (and that any such Sub-Servicer possesses). To the
extent such information is not otherwise available to the public, the Depositor
and the Trustee shall not disseminate any information obtained pursuant to the
preceding two sentences without the Master Servicer's or the related Servicer's
written consent, except as required pursuant to this Agreement or to the extent
that it is appropriate to do so (i) to its legal counsel, auditors, taxing
authorities or other governmental agencies and the Certificateholders, (ii)
pursuant to any law, rule, regulation, order, judgment, writ, injunction or
decree of any court or governmental authority having jurisdiction over the
Depositor and the Trustee or the Trust Fund, and in any case, the Depositor or
the Trustee, (iii) disclosure of any and all information that is or becomes
publicly known, or information obtained by the Trustee from sources other than
the Depositor, the related Servicer or the Master Servicer, (iv) disclosure as
required pursuant to this Agreement or (v) disclosure of any and all information
(A) in any preliminary or final offering circular, registration statement or
contract or other document pertaining to the transactions contemplated by the
Agreement approved in advance by the Depositor, the related Servicer or the
Master Servicer or (B) to any affiliate, independent or internal auditor, agent,
employee or attorney of the Trustee having a need to know the same, provided
that the Trustee advises such recipient of the confidential nature of the
information being disclosed, shall use its best efforts to assure the
confidentiality of any such disseminated non-public information. Nothing in this
Section 7.07 shall limit the obligation of the Servicer to comply with any
applicable law prohibiting disclosure of information regarding the Mortgagors
and the failure of the related Servicer to provide access as provided in this
Section 7.07 as a result of such obligation shall not constitute a breach of
this Section. Nothing in this Section 7.07 shall require the related Servicer to
collect, create, collate or otherwise generate any information that it does not
generate in its usual course of business. No Servicer shall be required to make
copies of or ship documents to any party unless provisions have been made for
the reimbursement of the costs thereof. The Depositor may, but is not obligated
to, enforce the obligations of the Master Servicer, ▇▇▇▇▇ Fargo under this
Agreement or Countrywide under the Servicing Agreement, and may, but is not
obligated to, perform, or cause a designee to perform, any defaulted obligation
of the Master Servicer, ▇▇▇▇▇ Fargo under this Agreement or Countrywide under
the Servicing Agreement, or exercise the rights of the Master Servicer, ▇▇▇▇▇
Fargo under this Agreement or Countrywide under the Servicing Agreement;
provided that neither the Master Servicer nor the related Servicer shall be
relieved of any of its obligations under this Agreement or the Servicing
Agreement, as applicable, by virtue of such performance by the Depositor or its
designee. The Depositor shall not have any responsibility or liability for any
action or failure to act by the Master Servicer or the Servicer and is not
obligated to supervise the performance of the Master Servicer or the Servicers
under this Agreement or the Servicing Agreement or otherwise.
SECTION 7.08. Duties of the Credit Risk Manager.
For and on behalf of the Depositor, the Credit Risk Manager will
provide reports and recommendations concerning certain delinquent and defaulted
Mortgage Loans, and as to the collection of any Prepayment Charges with respect
to the Mortgage Loans. Such reports and recommendations will be based upon
information provided to the Credit Risk Manager pursuant to the Credit Risk
Management Agreements, and the Credit Risk Manager shall look solely to the
Servicers and/or Master Servicer for all information and data (including loss
and delinquency information and data) relating to the servicing of the related
Mortgage Loans. Upon any termination of the Credit Risk Manager or the
appointment of a successor Credit Risk Manager, the Depositor shall give written
notice thereof to the related Servicer, the Master Servicer, the Securities
Administrator, the Trustee, and each Rating Agency. Notwithstanding the
foregoing, the termination of the Credit Risk Manager pursuant to this Section
shall not become effective until the appointment of a successor Credit Risk
Manager. The Trustee is hereby authorized to enter into any Credit Risk
Management Agreement necessary to effect the foregoing.
SECTION 7.09. Limitation Upon Liability of the Credit Risk Manager.
Neither the Credit Risk Manager, nor any of its directors, officers,
employees, or agents shall be under any liability to the Trustee, the
Certificateholders, or the Depositor for any action taken or for refraining from
the taking of any action made in good faith pursuant to this Agreement, in
reliance upon information provided by the Servicer under the related Credit Risk
Management Agreement, or for errors in judgment; provided, however, that this
provision shall not protect the Credit Risk Manager or any such person against
liability that would otherwise be imposed by reason of willful malfeasance or
bad faith in its performance of its duties. The Credit Risk Manager and any
director, officer, employee, or agent of the Credit Risk Manager may rely in
good faith on any document of any kind prima facie properly executed and
submitted by any Person respecting any matters arising hereunder, and may rely
in good faith upon the accuracy of information furnished by the related Servicer
pursuant to the related Credit Risk Management Agreement in the performance of
its duties thereunder and hereunder.
SECTION 7.10. Removal of the Credit Risk Manager.
The Credit Risk Manager may be removed as Credit Risk Manager by
Certificateholders holding not less than 66 2/3% of the Voting Rights in the
Trust Fund, in the exercise of its or their sole discretion. The
Certificateholders shall provide written notice of the Credit Risk Manager's
removal to the Trustee. Upon receipt of such notice, the Trustee shall provide
written notice to the Credit Risk Manager of its removal, which shall be
effective upon receipt of such notice by the Credit Risk Manager, with a copy to
the Securities Administrator and the Master Servicer.
ARTICLE VIII
DEFAULT
SECTION 8.01. Servicer Events of Default.
(a) "Servicer Event of Default," wherever used herein, means with
respect to ▇▇▇▇▇ Fargo any one of the following events:
(i) any failure by a Servicer to remit to the Securities
Administrator for distribution to the Certificateholders any payment
(other than a P&I Advance required to be made from its own funds on any
Servicer Remittance Date pursuant to Section 5.03 of this Agreement)
required to be made by such Servicer under the terms of the
Certificates and this Agreement which continues unremedied for a period
of one (1) Business Day after the date upon which written notice of
such failure, requiring the same to be remedied, shall have been given
to such Servicer by the Depositor or the Trustee (in which case notice
shall be provided by telecopy), or to such Servicer, the Depositor, the
Trustee and by the Holders of Certificates entitled to at least 25% of
the Voting Rights; or
(ii) any failure on the part of a Servicer duly to observe or
perform in any material respect any other of the covenants or
agreements on the part of such Servicer contained in this Agreement, or
the material breach by a Servicer of any representation and warranty
contained in Section 2.05 of this Agreement, which continues unremedied
for a period of thirty (30) days after the date on which written notice
of such failure, requiring the same to be remedied, shall have been
given to such Servicer by the Depositor or the Trustee or to such
Servicer, the Depositor and the Trustee by the Holders of Certificates
entitled to at least 25% of the Voting Rights; provided, however, that
in the case of a failure that cannot be cured within thirty (30) days,
the cure period may be extended for an additional thirty (30) days if
such Servicer can demonstrate to the reasonable satisfaction of the
Trustee that the Servicer is diligently pursuing remedial action; or
(iii) a decree or order of a court or agency or supervisory
authority having jurisdiction in the premises in an involuntary case
under any present or future federal or state bankruptcy, insolvency or
similar law or the appointment of a conservator or receiver or
liquidator in any insolvency, readjustment of debt, marshalling of
assets and liabilities or similar proceeding, or for the winding-up or
liquidation of its affairs, shall have been entered against a Servicer
and such decree or order shall have remained in force undischarged or
unstayed for a period of ninety (90) days; or
(iv) a Servicer shall consent to the appointment of a
conservator or receiver or liquidator in any insolvency, readjustment
of debt, marshalling of assets and liabilities or similar proceedings
of or relating to it or of or relating to all or substantially all of
its property; or
(v) a Servicer shall admit in writing its inability to pay its
debts generally as they become due, file a petition to take advantage
of any applicable insolvency or reorganization statute, make an
assignment for the benefit of its creditors, or voluntarily suspend
payment of its obligations;
(vi) failure by a Servicer to duly perform, within the
required time period, its obligations under Sections 3.17, 3.18 or 3.19
which failure continues unremedied for a period of ten (10) days after
the date on which written notice of such failure, requiring the same to
be remedied, shall have been given to the Servicer by any party to this
Agreement; or
(vii) any failure of a Servicer to make any P&I Advance on any
Servicer Remittance Date required to be made from its own funds
pursuant to Section 5.03 which continues unremedied until 3:00 p.m. New
York time on the Business Day immediately following the Servicer
Remittance Date; or
(viii) failure of a Servicer to maintain at least an "average"
rating from the Rating Agencies.
A "Servicer Event of Default" whenever used herein means, with respect
to Countrywide, an event of default by under the Servicing Agreement.
If a Servicer Event of Default described in clauses (i) through (vi) or
(viii) of this Section or a corresponding Servicer Event of Default under the
Servicing Agreement shall occur, then, and in each and every such case, so long
as such Servicer Event of Default shall not have been remedied, the Depositor or
the Trustee may, and at the written direction of the Holders of Certificates
entitled to at least 51% of Voting Rights, the Trustee shall, by notice in
writing to the defaulting Servicer (and to the Depositor if given by the Trustee
or to the Trustee if given by the Depositor) with a copy to the Master Servicer
and each Rating Agency, terminate all of the rights and obligations of the
defaulting Servicer in its capacity as a Servicer under this Agreement, to the
extent permitted by law, and in and to the related Mortgage Loans and the
proceeds thereof. If a Servicer Event of Default described in clause (vii)
hereof or the corresponding Servicer Event of Default under the Servicing
Agreement shall occur, the Trustee shall, by notice in writing to the defaulting
Servicer, the Depositor and the Master Servicer, terminate all of the rights and
obligations of the defaulting Servicer in its capacity as a Servicer under this
Agreement and in and to the related Mortgage Loans and the proceeds thereof.
Subject to Section 8.02 of this Agreement, on or after the receipt by the
defaulting Servicer of such written notice, all authority and power of the
defaulting Servicer under this Agreement or the Servicing Agreement, as
applicable, whether with respect to the Certificates (other than as a Holder of
any Certificate) or the related Mortgage Loans or otherwise, shall pass to and
be vested in the Master Servicer, or if ▇▇▇▇▇ Fargo is the defaulting Servicer,
the Trustee pursuant to and under this Section, and, without limitation, the
Master Servicer or the Trustee, as applicable, is hereby authorized and
empowered, as attorney-in-fact or otherwise, to execute and deliver, on behalf
of and at the expense of the defaulting Servicer, any and all documents and
other instruments and to do or accomplish all other acts or things necessary or
appropriate to effect the purposes of such notice of termination, whether to
complete the transfer and endorsement or assignment of the related Mortgage
Loans and related documents, or otherwise. The defaulting Servicer agrees
promptly (and in any event no later than ten (10) Business Days subsequent to
such notice) to provide the Master Servicer or the Trustee, as applicable, with
all documents and records requested by it to enable it to assume the defaulting
Servicer's functions under this Agreement, and to cooperate with the Master
Servicer in effecting the termination of the defaulting Servicer's
responsibilities and rights under this Agreement, including, without limitation,
the transfer within one (1) Business Day to the Master Servicer or the Trustee,
as applicable, for administration by it of all cash amounts which at the time
shall be or should have been credited by the defaulting Servicer to the related
Collection Account held by or on behalf of the defaulting Servicer or thereafter
be received with respect to the related Mortgage Loans or any related REO
Property (provided, however, that the defaulting Servicer shall continue to be
entitled to receive all amounts accrued or owing to it under this Agreement on
or prior to the date of such termination, whether in respect of P&I Advances,
Servicing Advances, accrued and unpaid Servicing Fees or otherwise, and shall
continue to be entitled to the benefits of Section 7.03 of this Agreement,
notwithstanding any such termination, with respect to events occurring prior to
such termination). Reimbursement of ▇▇▇▇▇▇▇▇▇▇▇▇ ▇&▇ Advances, Servicing
Advances and accrued and unpaid Servicing Fees shall be made on a first in,
first out ("FIFO") basis no later than the Servicer Remittance Date. For
purposes of this Section 8.01(a), the Trustee shall not be deemed to have
knowledge of a Servicer Event of Default unless a Responsible Officer of the
Trustee assigned to and working in the Trustee's Corporate Trust Office has
actual knowledge thereof or unless written notice of any event which is in fact
such a Servicer Event of Default is received by the Trustee at its Corporate
Trust Office and such notice references the Certificates, the Trust or this
Agreement. The Trustee shall promptly notify the Master Servicer and the Rating
Agencies of the occurrence of a Servicer Event of Default of which it has
knowledge as provided above.
The Master Servicer or the Trustee, as applicable, shall be entitled to
be reimbursed by the defaulting Servicer (or from amounts on deposit in the
Distribution Account if the defaulting Servicer is unable to fulfill its
obligations hereunder) for all reasonable out-of-pocket or third party costs
associated with the transfer of servicing from the defaulting Servicer,
including without limitation, any reasonable out-of-pocket or third party costs
or expenses associated with the complete transfer of all servicing data and the
completion, correction or manipulation of such servicing data as may be required
by the Master Servicer or the Trustee, as applicable, to correct any errors or
insufficiencies in the servicing data or otherwise to enable the Master Servicer
or the Trustee, as applicable, to service the related Mortgage Loans properly
and effectively, upon presentation of reasonable documentation of such costs and
expenses.
(b) "Master Servicer Event of Default," wherever used herein, means any
one of the following events:
(i) any failure on the part of the Master Servicer duly to
observe or perform in any material respect any other of the covenants
or agreements on the part of the Master Servicer contained in this
Agreement, or the breach by the Master Servicer of any representation
and warranty contained in Section 2.04, which continues unremedied for
a period of 30 days after the date on which written notice of such
failure, requiring the same to be remedied, shall have been given to
the Master Servicer by the Depositor or the Trustee or to the Master
Servicer, the Depositor and the Trustee by the Holders of Certificates
entitled to at least 25% of the Voting Rights; or
(ii) a decree or order of a court or agency or supervisory
authority having jurisdiction in the premises in an involuntary case
under any present or future federal or state bankruptcy, insolvency or
similar law or the appointment of a conservator or receiver or
liquidator in any insolvency, readjustment of debt, marshalling of
assets and liabilities or similar proceeding, or for the winding-up or
liquidation of its affairs, shall have been entered against the Master
Servicer and such decree or order shall have remained in force
undischarged or unstayed for a period of ninety (90) days; or
(iii) the Master Servicer shall consent to the appointment of
a conservator or receiver or liquidator in any insolvency, readjustment
of debt, marshalling of assets and liabilities or similar proceedings
of or relating to it or of or relating to all or substantially all of
its property; or
(iv) the Master Servicer shall admit in writing its inability
to pay its debts generally as they become due, file a petition to take
advantage of any applicable insolvency or reorganization statute, make
an assignment for the benefit of its creditors, or voluntarily suspend
payment of its obligations.
If a Master Servicer Event of Default shall occur, then, and in each
and every such case, so long as such Master Servicer Event of Default shall not
have been remedied, the Depositor or the Trustee may, and at the written
direction of the Holders of Certificates entitled to at least 51% of Voting
Rights, the Trustee shall, by notice in writing to the Master Servicer (and to
the Depositor if given by the Trustee or to the Trustee if given by the
Depositor) with a copy to each Rating Agency, terminate all of the rights and
obligations of the Master Servicer in its capacity as Master Servicer under this
Agreement, to the extent permitted by law, and in and to the Mortgage Loans and
the proceeds thereof. On or after the receipt by the Master Servicer of such
written notice, all authority and power of the Master Servicer under this
Agreement, whether with respect to the Certificates (other than as a Holder of
any Certificate) or the Mortgage Loans or otherwise including, without
limitation, the compensation payable to the Master Servicer under this
Agreement, shall pass to and be vested in the Trustee pursuant to and under this
Section, and, without limitation, the Trustee is hereby authorized and
empowered, as attorney-in-fact or otherwise, to execute and deliver, on behalf
of and at the expense of the Master Servicer, any and all documents and other
instruments and to do or accomplish all other acts or things necessary or
appropriate to effect the purposes of such notice of termination, whether to
complete the transfer and endorsement or assignment of the Mortgage Loans and
related documents, or otherwise. The Master Servicer agrees promptly (and in any
event no later than ten Business Days subsequent to such notice) to provide the
Trustee with all documents and records requested by it to enable it to assume
the Master Servicer's functions under this Agreement, and to cooperate with the
Trustee in effecting the termination of the Master Servicer's responsibilities
and rights under this Agreement (provided, however, that the Master Servicer
shall continue to be entitled to receive all amounts accrued or owing to it
under this Agreement on or prior to the date of such termination and shall
continue to be entitled to the benefits of Section 7.03 of this Agreement,
notwithstanding any such termination, with respect to events occurring prior to
such termination). For purposes of this Section 8.01(b), the Trustee shall not
be deemed to have knowledge of a Master Servicer Event of Default unless a
Responsible Officer of the Trustee assigned to and working in the Trustee's
Corporate Trust Office has actual knowledge thereof or unless written notice of
any event which is in fact such a Master Servicer Event of Default is received
by the Trustee and such notice references the Certificates, the Trust or this
Agreement. The Trustee shall promptly notify the Rating Agencies of the
occurrence of a Master Servicer Event of Default of which it has knowledge as
provided above.
To the extent that the costs and expenses of the Trustee related to the
termination of the Master Servicer, appointment of a successor Master Servicer
or the transfer and assumption of the master servicing by the Trustee
(including, without limitation, (i) all legal costs and expenses and all due
diligence costs and expenses associated with an evaluation of the potential
termination of the Master Servicer as a result of a Master Servicer Event of
Default and (ii) all costs and expenses associated with the complete transfer of
the master servicing, including all servicing files and all servicing data and
the completion, correction or manipulation of such servicing data as may be
required by the successor Master Servicer to correct any errors or
insufficiencies in the servicing data or otherwise to enable the successor
Master Servicer to master service the Mortgage Loans in accordance with this
Agreement) are not fully and timely reimbursed by the terminated Master
Servicer, the Trustee shall be entitled to reimbursement of such costs and
expenses from the Distribution Account.
Notwithstanding the foregoing, the Trustee may, if it shall be
unwilling to continue to act, or shall, if it is unable to so act, petition a
court of competent jurisdiction to appoint, or appoint on its own behalf, any
established housing and home finance institution servicer, master servicer,
servicing or mortgage servicing institution having a net worth of not less than
25,000,000 and meeting such other standards for a successor master servicer as
are set forth in this Agreement, as the successor to such Master Servicer in the
assumption of all of the responsibilities, duties or liabilities of a master
servicer.
SECTION 8.02. Master Servicer or Trustee to Act; Appointment of
Successor.
(a) On and after the time a Servicer receives a notice of termination,
the Master Servicer or, if ▇▇▇▇▇ Fargo receives the notice of termination, the
Trustee, shall be the successor in all respects to such Servicer in its capacity
as a Servicer under this Agreement or the Servicing Agreement, as applicable,
and the transactions set forth or provided for herein or therein, and all the
responsibilities, duties and liabilities relating thereto and arising thereafter
shall be assumed by the Master Servicer or the Trustee, as applicable (except
for any representations or warranties of such Servicer under this Agreement ort
the Servicing Agreement, as applicable, the responsibilities, duties and
liabilities contained in Section 2.03 of this Agreement and the obligation to
deposit amounts in respect of losses pursuant to Section 3.10(b) of this
Agreement) by the terms and provisions hereof including, without limitation,
such Servicer's obligations to make P&I Advances pursuant to Section 5.03 of
this Agreement or pursuant to the Servicing Agreement; provided, however, that
if the Master Servicer or the Trustee, as applicable, is prohibited by law or
regulation from obligating itself to make advances regarding delinquent mortgage
loans, then the Master Servicer or the Trustee, as applicable shall not be
obligated to make P&I Advances pursuant to Section 5.03 of this Agreement or
pursuant to the Servicing Agreement; and provided further, that any failure to
perform such duties or responsibilities caused by such Servicer's failure to
provide information required by Section 8.01 of this Agreement or under the
Servicing Agreement shall not be considered a default by the Master Servicer or
the Trustee, as applicable as successor to such Servicer hereunder; provided,
however, that (1) it is understood and acknowledged by the parties hereto that
there will be a period of transition (not to exceed ninety (90) days) before the
actual servicing functions can be fully transferred to the Master Servicer or
the Trustee, as applicable or any successor Servicer appointed in accordance
with the following provisions and (2) any failure to perform such duties or
responsibilities caused by such Servicer's failure to provide information
required by Section 8.01 of this Agreement or under the Servicing Agreement
shall not be considered a default by the Master Servicer or the Trustee, as
applicable as successor to such Servicer. As compensation therefor, the Master
Servicer or the Trustee, as applicable shall be entitled to the Servicing Fee
and all funds relating to the related Mortgage Loans to which the terminated
Servicer would have been entitled if it had continued to act hereunder or under
the Servicing Agreement. Notwithstanding the above and subject to the
immediately following paragraph, the Master Servicer or the Trustee, as
applicable may, if it shall be unwilling to so act, or shall, if it is unable to
so act promptly appoint or petition a court of competent jurisdiction to
appoint, a Person that satisfies the eligibility criteria set forth below as the
successor to the terminated Servicer under this Agreement or under the Servicing
Agreement in the assumption of all or any part of the responsibilities, duties
or liabilities of the terminated Servicer under this Agreement or under the
Servicing Agreement.
Notwithstanding anything herein to the contrary, in no event shall the
Trustee or the Master Servicer be liable for any Servicing Fee or for any
differential in the amount of the Servicing Fee paid hereunder or under the
Servicing Agreement and the amount necessary to induce any successor Servicer to
act as successor Servicer under this Agreement or under the Servicing Agreement
and the transactions set forth or provided for herein.
Any successor Servicer appointed under this Agreement must (i) be an
established mortgage loan servicing institution that is a ▇▇▇▇▇▇ ▇▇▇ and ▇▇▇▇▇▇▇
Mac approved seller/servicer, (ii) be approved by each Rating Agency by a
written confirmation from each Rating Agency that the appointment of such
successor Servicer would not result in the reduction or withdrawal of the then
current ratings of any outstanding Class of Certificates, (iii) have a net worth
of not less than 25,000,000 and (iv) assume all the responsibilities, duties or
liabilities of the related Servicer (other than liabilities of the related
Servicer hereunder incurred prior to termination of the related Servicer under
Section 8.01 herein) under this Agreement as if originally named as a party to
this Agreement.
(b) (1) All servicing transfer costs (including, without limitation,
servicing transfer costs of the type described in Section 8.02(a) of this
Agreement and incurred by the Trustee, the Master Servicer and any successor
Servicer under paragraph (b)(2) below) in connection with the termination of a
Servicer shall be paid by the terminated Servicer upon presentation of
reasonable documentation of such costs, and if such predecessor or initial
Servicer, as applicable, defaults in its obligation to pay such costs, the
successor Servicer, the Master Servicer and the Trustee shall be entitled to
reimbursement therefor from the assets of the Trust Fund.
(2) No appointment of a successor to a Servicer under this Agreement
shall be effective until the assumption by the successor of all of such
Servicer's responsibilities, duties and liabilities hereunder. In connection
with such appointment and assumption described herein, the Trustee may make such
arrangements for the compensation of such successor out of payments on the
related Mortgage Loans as it and such successor shall agree; provided, however,
that no such compensation shall be in excess of that permitted the related
Servicer as such hereunder or under the Servicing Agreement. The Depositor, the
Trustee and such successor shall take such action, consistent with this
Agreement, as shall be necessary to effectuate any such succession. Pending
appointment of a successor to the related Servicer under this Agreement, the
Master Servicer or the Trustee, as applicable shall act in such capacity as
hereinabove provided.
SECTION 8.03. Notification to Certificateholders.
(a) Upon any termination of the Master Servicer or a Servicer pursuant
to Section 8.01(a) or (b) of this Agreement or under the Servicing Agreement, as
applicable, or any appointment of a successor to the master Servicer or a
Servicer pursuant to Section 8.02 of this Agreement or pursuant to the Servicing
Agreement, as applicable, the Trustee shall give prompt written notice thereof
to the Certificateholders at their respective addresses appearing in the
Certificate Register.
(b) Not later than the later of sixty (60) days after the occurrence of
any event, which constitutes or which, with notice or lapse of time or both,
would constitute a Servicer Event of Default or a Master Servicer Event of
Default or five (5) days after a Responsible Officer of the Trustee becomes
aware of the occurrence of such an event, the Trustee shall transmit by mail to
all Holders of Certificates notice of each such occurrence, unless such default
or Servicer Event of Default or Master Servicer Event of Default shall have been
cured or waived.
SECTION 8.04. Waiver of Servicer Events of Default.
The Holders representing at least 66% of the Voting Rights evidenced by
all Classes of Certificates affected by any default, Servicer Event of Default
or Master Servicer Event of Default hereunder may waive such default, Servicer
Event of Default or Master Servicer Event of Default; provided, however, that a
Servicer Event of Default under clause (i) or (vii) of Section 8.01(a) of this
Agreement may be waived only by all of the Holders of the Regular Certificates.
Upon any such waiver of a default, Servicer Event of Default or Master Servicer
Event of Default, such default, Servicer Event of Default or Master Servicer
Event of Default shall cease to exist and shall be deemed to have been remedied
for every purpose hereunder. No such waiver shall extend to any subsequent or
other default, Servicer Event of Default or Master Servicer Event of Default or
impair any right consequent thereon except to the extent expressly so waived.
ARTICLE IX
CONCERNING THE TRUSTEE AND THE SECURITIES ADMINISTRATOR
SECTION 9.01. Duties of Trustee and Securities Administrator.
The Trustee, prior to the occurrence of a Master Servicer Event of
Default and after the curing or waiver of all Master Servicer Events of Default
which may have occurred, and the Securities Administrator each undertake to
perform such duties and only such duties as are specifically set forth in this
Agreement as duties of the Trustee and the Securities Administrator,
respectively. During the continuance of a Master Servicer Event of Default, the
Trustee shall exercise such of the rights and powers vested in it by this
Agreement, and use the same degree of care and skill in its exercise as a
prudent person would exercise or use under the circumstances in the conduct of
such person's own affairs. Any permissive right of the Trustee enumerated in
this Agreement shall not be construed as a duty.
Each of the Trustee and the Securities Administrator, upon receipt of
all resolutions, certificates, statements, opinions, reports, documents, orders
or other instruments furnished to it, which are specifically required to be
furnished pursuant to any provision of this Agreement, shall examine them to
determine whether they conform to the requirements of this Agreement. If any
such instrument is found not to conform to the requirements of this Agreement in
a material manner, the Trustee or the Securities Administrator, as the case may
be, shall take such action as it deems appropriate to have the instrument
corrected, and if the instrument is not corrected to its satisfaction, the
Securities Administrator will provide notice to the Trustee thereof and the
Trustee will provide notice to the Certificateholders.
The Trustee shall promptly remit to the related Servicer any complaint,
claim, demand, notice or other document (collectively, the "Notices") delivered
to the Trustee as a consequence of the assignment of any Mortgage Loan hereunder
and relating to the servicing of the Mortgage Loans; provided than any such
notice (i) is delivered to the Trustee at its Corporate Trust Office, (ii)
contains information sufficient to permit the Trustee to make a determination
that the real property to which such document relates is a Mortgaged Property.
The Trustee shall have no duty hereunder with respect to any Notice it may
receive or which may be alleged to have been delivered to or served upon it
unless such Notice is delivered to it or served upon it at its Corporate Trust
Office and such Notice contains the information required pursuant to clause (ii)
of the preceding sentence.
No provision of this Agreement shall be construed to relieve the
Trustee or the Securities Administrator from liability for its own negligent
action, its own negligent failure to act or its own misconduct; provided,
however, that:
(i) Prior to the occurrence of a Master Servicer Event of
Default, and after the curing or waiver of all such Master Servicer
Events of Default which may have occurred with respect to the Trustee
and at all times with respect to the Securities Administrator, the
duties and obligations of the Trustee shall be determined solely by the
express provisions of this Agreement, neither the Trustee nor the
Securities Administrator shall be liable except for the performance of
such duties and obligations as are specifically set forth in this
Agreement, no implied covenants or obligations shall be read into this
Agreement against the Trustee or the Securities Administrator and, in
the absence of bad faith on the part of the Trustee or the Securities
Administrator, respectively, the Trustee or the Securities
Administrator, respectively, may conclusively rely, as to the truth of
the statements and the correctness of the opinions expressed therein,
upon any certificates or opinions furnished to the Trustee or the
Securities Administrator, respectively, that conform to the
requirements of this Agreement;
(ii) Neither the Trustee nor the Securities Administrator
shall be liable for an error of judgment made in good faith by a
Responsible Officer or Responsible Officers of the Trustee or an
officer or officers of the Securities Administrator, respectively,
unless it shall be proved that the Trustee or the Securities
Administrator, respectively, was negligent in ascertaining the
pertinent facts; and
(iii) Neither the Trustee nor the Securities Administrator
shall be liable with respect to any action taken, suffered or omitted
to be taken by it in good faith in accordance with the direction of the
Holders of Certificates entitled to at least 25% of the Voting Rights
relating to the time, method and place of conducting any proceeding for
any remedy available to the Trustee or the Securities Administrator or
exercising any trust or power conferred upon the Trustee or the
Securities Administrator under this Agreement.
SECTION 9.02. Certain Matters Affecting Trustee and Securities
Administrator.
(a) Except as otherwise provided in Section 9.01 of this Agreement:
(i) The Trustee and the Securities Administrator may request
and rely upon and shall be protected in acting or refraining from
acting upon any resolution, Officers' Certificate, certificate of
auditors or any other certificate, statement, instrument, opinion,
report, notice, request, consent, order, appraisal, bond or other paper
or document reasonably believed by it to be genuine and to have been
signed or presented by the proper party or parties;
(ii) The Trustee and the Securities Administrator may consult
with counsel of its selection and any advice of such counsel or any
Opinion of Counsel shall be full and complete authorization and
protection in respect of any action taken or suffered or omitted by it
hereunder in good faith and in accordance with such advice or Opinion
of Counsel;
(iii) Neither the Trustee nor the Securities Administrator
shall be under any obligation to exercise any of the trusts or powers
vested in it by this Agreement or to institute, conduct or defend any
litigation hereunder or in relation hereto at the request, order or
direction of any of the Certificateholders, pursuant to the provisions
of this Agreement, unless such Certificateholders shall have offered to
the Trustee or the Securities Administrator, as the case may be,
reasonable security or indemnity satisfactory to it against the costs,
expenses and liabilities which may be incurred therein or thereby;
nothing contained herein shall, however, relieve the Trustee of the
obligation, upon the occurrence of a Master Servicer Event of Default
(which has not been cured or waived), to exercise such of the rights
and powers vested in it by this Agreement, and to use the same degree
of care and skill in their exercise as a prudent person would exercise
or use under the circumstances in the conduct of such person's own
affairs;
(iv) Neither the Trustee nor the Securities Administrator
shall be liable for any action taken, suffered or omitted by it in good
faith and believed by it to be authorized or within the discretion or
rights or powers conferred upon it by this Agreement;
(v) Prior to the occurrence of a Master Servicer Event of
Default hereunder and after the curing or waiver of all Master Servicer
Events of Default which may have occurred with respect to the Trustee
and at all times with respect to the Securities Administrator, neither
the Trustee nor the Securities Administrator shall be bound to make any
investigation into the facts or matters stated in any resolution,
certificate, statement, instrument, opinion, report, notice, request,
consent, order, approval, bond or other paper or document, unless
requested in writing to do so by the Holders of Certificates entitled
to at least 25% of the Voting Rights; provided, however, that if the
payment within a reasonable time to the Trustee or the Securities
Administrator of the costs, expenses or liabilities likely to be
incurred by it in the making of such investigation is, in the opinion
of the Trustee or the Securities Administrator, as applicable, not
reasonably assured to the Trustee or the Securities Administrator by
such Certificateholders, the Trustee or the Securities Administrator,
as applicable, may require reasonable indemnity satisfactory to it
against such expense, or liability from such Certificateholders as a
condition to taking any such action;
(vi) The Trustee may execute any of the trusts or powers
hereunder or perform any duties hereunder either directly or by or
through agents or attorneys and the Trustee shall not be responsible
for any misconduct or negligence on the part of any agent or attorney
appointed with due care by it hereunder;
(vii) The Trustee shall not be liable for any loss resulting
from (a) the investment of funds held in any Collection Account or the
Custodial Account, (b) the investment of funds held in the Distribution
Account, (c) the investment of funds held in the Reserve Fund or (d)
the redemption or sale of any such investment as therein authorized;
(viii) The Trustee shall not be deemed to have notice of any
default, Master Servicer Event of Default or Servicer Event of Default
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 a Responsible Officer of the Trustee at the
Corporate Trust Office of the Trustee, and such notice references the
Certificates and this Agreement; and
(ix) The rights, privileges, protections, immunities and
benefits given to the Trustee, including, without limitation, its right
to be indemnified, are extended to, and shall be enforceable by, each
agent, custodian and other Person employed to act hereunder.
(b) All rights of action under this Agreement or under any of the
Certificates, enforceable by the Trustee, may be enforced by it without the
possession of any of the Certificates, or the production thereof at the trial or
other proceeding relating thereto, and any such suit, action or proceeding
instituted by the Trustee shall be brought in its name for the benefit of all
the Holders of such Certificates, subject to the provisions of this Agreement.
(c) The Trustee is hereby directed by the Depositor to execute the Swap
Agreement on behalf of the Supplemental Interest Trust in the form presented to
it by the Depositor and shall have no responsibility for the contents of the
Swap Agreement, including, without limitation, the representations and
warranties contained therein. Any funds payable by the Trustee on behalf of the
Supplemental Interest Trust under the Swap Agreement shall be paid from funds of
the Supplemental Interest Trust in accordance with the terms and provisions of
the Swap Agreement. Notwithstanding anything to the contrary contained herein or
in the Swap Agreement, the Trustee shall not be required to make any payments to
the counterparty under the Swap Agreement.
(d) None of the Securities Administrator, the Master Servicer, the
Servicers, the Seller, the Depositor, the Custodians or the Trustee shall be
responsible for the acts or omissions of the others or the Swap Provider, it
being understood that this Agreement shall not be construed to render those
partners joint venturers or agents of one another.
SECTION 9.03. Trustee and Securities Administrator not Liable for
Certificates or Mortgage Loans.
The recitals contained herein and in the Certificates (other than the
signature of the Securities Administrator, the authentication of the Securities
Administrator on the Certificates, the acknowledgments of the Trustee contained
in Article II and the representations and warranties of the Trustee in Section
9.12 of this Agreement) shall be taken as the statements of the Depositor and
neither the Trustee nor the Securities Administrator assumes any responsibility
for their correctness. Neither the Trustee nor the Securities Administrator
makes any representations or warranties as to the validity or sufficiency of
this Agreement (other than as specifically set forth in Section 9.12 of this
Agreement), the Swap Agreement or of the Certificates (other than the signature
of the Securities Administrator and authentication of the Securities
Administrator on the Certificates) or of any Mortgage Loan or related document.
The Trustee and the Securities Administrator shall not be accountable for the
use or application by the Depositor of any of the Certificates or of the
proceeds of such Certificates, or for the use or application of any funds paid
to the Depositor or the Master Servicer in respect of the Mortgage Loans or
deposited in or withdrawn from any Collection Account or the Custodial Account
by the related Servicer, other than with respect to the Securities Administrator
any funds held by it or on behalf of the Trustee in accordance with Sections
3.23 and 3.24 of this Agreement.
SECTION 9.04. Trustee and Securities Administrator May Own
Certificates.
Each of the Trustee and the Securities Administrator in its individual
capacity or any other capacity may become the owner or pledgee of Certificates
and may transact business with other interested parties and their Affiliates
with the same rights it would have if it were not Trustee or the Securities
Administrator.
SECTION 9.05. Fees and Expenses of Trustee and Securities
Administrator.
The fees of the Trustee and the Securities Administrator hereunder, of
▇▇▇▇▇ Fargo as the Custodian under the ▇▇▇▇▇ Fargo Custodial Agreement and of
DBNT as the Custodian under the DBNT Custodial Agreement shall be paid in
accordance with a side letter agreement with the Master Servicer and at the sole
expense of the Master Servicer. In addition, the Trustee, the Securities
Administrator, the Custodians and any director, officer, employee or agent of
the Trustee, the Securities Administrator and the Custodians shall be
indemnified by the Trust and held harmless against any loss, liability or
expense (including reasonable attorney's fees and expenses) incurred by the
Trustee, the Custodians or the Securities Administrator in connection with any
claim or legal action or any pending or threatened claim or legal action arising
out of or in connection with the acceptance or administration of its respective
obligations and duties under this Agreement, including the Swap Agreement and
any and all other agreements related hereto, other than any loss, liability or
expense (i) for which the Trustee is indemnified by the Master Servicer or any
Servicer, (ii) that constitutes a specific liability of the Trustee or the
Securities Administrator pursuant to Section 11.01(g) of this Agreement or (iii)
any loss, liability or expense incurred by reason of willful misfeasance, bad
faith or negligence in the performance of duties hereunder by the Trustee or the
Securities Administrator or by reason of reckless disregard of obligations and
duties hereunder. In no event shall the Trustee or the Securities Administrator
be liable for special, indirect or consequential loss or damage of any kind
whatsoever (including but not limited to lost profits), even if it has been
advised of the likelihood of such loss or damage and regardless of the form of
action. The Master Servicer agrees to indemnify the Trustee, from, and hold the
Trustee harmless against, any loss, liability or expense (including reasonable
attorney's fees and expenses) incurred by the Trustee by reason of the Master
Servicer's willful misfeasance, bad faith or gross negligence in the performance
of its duties under this Agreement or by reason of the Master Servicer's
reckless disregard of its obligations and duties under this Agreement. In
addition, the Seller agrees to indemnify the Trustee for, and to hold the
Trustee harmless against, any loss, liability or expense arising out of, or in
connection with, the provisions set forth in the last paragraph of Section 2.01
of this Agreement, including, without limitation, all costs, liabilities and
expenses (including reasonable legal fees and expenses) of investigating and
defending itself against any claim, action or proceeding, pending or threatened,
relating to the provisions of such paragraph. The indemnities in this Section
9.05 shall survive the termination or discharge of this Agreement and the
resignation or removal of the Master Servicer, the Trustee, the Securities
Administrator or the Custodians. Any payment hereunder made by the Master
Servicer to the Trustee shall be from the Master Servicer's own funds, without
reimbursement from REMIC I therefor.
SECTION 9.06. Eligibility Requirements for Trustee and Securities
Administrator.
The Trustee and the Securities Administrator shall at all times be a
corporation or an association (other than the Depositor, the Seller, the Master
Servicer or any Affiliate of the foregoing) organized and doing business under
the laws of any state or the United States of America, authorized under such
laws to exercise corporate trust powers, having a combined capital and surplus
of at least 50,000,000 (or a member of a bank holding company whose capital and
surplus is at least 50,000,000) and subject to supervision or examination by
federal or state authority. If such corporation or association publishes reports
of conditions at least annually, pursuant to law or to the requirements of the
aforesaid supervising or examining authority, then for the purposes of this
Section the combined capital and surplus of such corporation or association
shall be deemed to be its combined capital and surplus as set forth in its most
recent report of conditions so published. In case at any time the Trustee or the
Securities Administrator, as applicable, shall cease to be eligible in
accordance with the provisions of this Section, the Trustee or the Securities
Administrator, as applicable, shall resign immediately in the manner and with
the effect specified in Section 9.07 of this Agreement.
SECTION 9.07. Resignation and Removal of Trustee and Securities
Administrator.
The Trustee and the Securities Administrator may at any time resign and
be discharged from the trust hereby created by giving written notice thereof to
the Depositor, to the Master Servicer, to the Securities Administrator (or the
Trustee, if the Securities Administrator resigns) and to the Certificateholders.
Upon receiving such notice of resignation, the Depositor shall promptly appoint
a successor trustee or successor securities administrator by written instrument,
in duplicate, which instrument shall be delivered to the resigning Trustee or
Securities Administrator, as applicable, and to the successor trustee or
successor securities administrator, as applicable. A copy of such instrument
shall be delivered to the Certificateholders, the Trustee, the Securities
Administrator and the Master Servicer by the Depositor. If no successor trustee
or successor securities administrator shall have been so appointed and have
accepted appointment within thirty (30) days after the giving of such notice of
resignation, the resigning Trustee or Securities Administrator, as the case may
be, may, at the expense of the Trust Fund, petition any court of competent
jurisdiction for the appointment of a successor trustee, successor securities
administrator, Trustee or Securities Administrator, as applicable.
If at any time the Trustee or the Securities Administrator shall cease
to be eligible in accordance with the provisions of Section 9.06 of this
Agreement and shall fail to resign after written request therefor by the
Depositor, or if at any time the Trustee or the Securities Administrator shall
become incapable of acting, or shall be adjudged bankrupt or insolvent, or a
receiver of the Trustee or the Securities Administrator or of its property shall
be appointed, or any public officer shall take charge or control of the Trustee
or the Securities Administrator or of its property or affairs for the purpose of
rehabilitation, conservation or liquidation, then the Depositor may remove the
Trustee or the Securities Administrator, as applicable and appoint a successor
trustee or successor securities administrator, as applicable, by written
instrument, in duplicate, which instrument shall be delivered to the Trustee or
the Securities Administrator so removed and to the successor trustee or
successor securities administrator. A copy of such instrument shall be delivered
to the Certificateholders, the Trustee, the Securities Administrator and the
Master Servicer by the Depositor.
The Holders of Certificates entitled to at least 51% of the Voting
Rights may at any time remove the Trustee or the Securities Administrator and
appoint a successor trustee or successor securities administrator by written
instrument or instruments, in triplicate, signed by such Holders or their
attorneys-in-fact duly authorized, one complete set of which instruments shall
be delivered to the Depositor, one complete set to the Trustee or the Securities
Administrator so removed and one complete set to the successor so appointed. A
copy of such instrument shall be delivered to the Certificateholders, the
Trustee (in the case of the removal of the Securities Administrator), the
Securities Administrator (in the case of the removal of the Trustee) and the
Master Servicer by the Depositor.
Any resignation or removal of the Trustee or the Securities
Administrator and appointment of a successor trustee or successor securities
administrator pursuant to any of the provisions of this Section shall not become
effective until acceptance of appointment by the successor trustee or successor
securities administrator, as applicable, as provided in Section 9.08.
Notwithstanding anything to the contrary contained herein, the Master
Servicer and the Securities Administrator shall at all times be the same Person.
SECTION 9.08. Successor Trustee or Securities Administrator.
Any successor trustee or successor securities administrator appointed
as provided in Section 9.07 of this Agreement shall execute, acknowledge and
deliver to the Depositor and its predecessor trustee or predecessor securities
administrator an instrument accepting such appointment hereunder, and thereupon
the resignation or removal of the predecessor trustee or predecessor securities
administrator shall become effective and such successor trustee or successor
securities administrator without any further act, deed or conveyance, shall
become fully vested with all the rights, powers, duties and obligations of its
predecessor hereunder, with the like effect as if originally named as trustee or
securities administrator herein. The predecessor trustee or predecessor
securities administrator shall deliver to the successor trustee or successor
securities administrator all Mortgage Loan Documents and related documents and
statements to the extent held by it hereunder, as well as all monies, held by it
hereunder, and the Depositor and the predecessor trustee or predecessor
securities administrator shall execute and deliver such instruments and do such
other things as may reasonably be required for more fully and certainly vesting
and confirming in the successor trustee or successor securities administrator
all such rights, powers, duties and obligations.
No successor trustee or successor securities administrator shall accept
appointment as provided in this Section unless at the time of such acceptance
such successor trustee or successor securities administrator shall be eligible
under the provisions of Section 9.06 and the appointment of such successor
trustee or successor securities administrator shall not result in a downgrading
of any Class of Certificates by any Rating Agency, as evidenced by a letter from
each Rating Agency.
Upon acceptance of appointment by a successor trustee or successor
securities administrator as provided in this Section, the Depositor shall mail
notice of the succession of such trustee hereunder to all Holders of
Certificates at their addresses as shown in the Certificate Register. If the
Depositor fails to mail such notice within ten (10) days after acceptance of
appointment by the successor trustee or successor securities administrator, the
successor trustee or successor securities administrator shall cause such notice
to be mailed at the expense of the Depositor.
SECTION 9.09. Merger or Consolidation of Trustee or Securities
Administrator.
Any corporation or association into which the Trustee or the Securities
Administrator may be merged or converted or with which it may be consolidated or
any corporation or association resulting from any merger, conversion or
consolidation to which the Trustee or the Securities Administrator shall be a
party, or any corporation or association succeeding to the business of the
Trustee or the Securities Administrator shall be the successor of the Trustee or
the Securities Administrator hereunder, provided such corporation or association
shall be eligible under the provisions of Section 9.06 of this Agreement,
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.
SECTION 9.10. Appointment of Co-Trustee or Separate Trustee.
Notwithstanding any other provisions hereof, at any time, for the
purpose of meeting any legal requirements of any jurisdiction in which any part
of the REMIC I or property securing the same may at the time be located, the
Trustee shall have the power and shall execute and deliver all instruments to
appoint one or more Persons approved by the Trustee to act as co-trustee or
co-trustees, jointly with the Trustee, or separate trustee or separate trustees,
of all or any part of REMIC I, and to vest in such Person or Persons, in such
capacity, and for the benefit of the Holders of the Certificates, such title to
REMIC I, or any part thereof, and, subject to the other provisions of this
Section 9.10, such powers, duties, obligations, rights and trusts as the Trustee
may consider necessary or desirable. No co-trustee or separate trustee hereunder
shall be required to meet the terms of eligibility as a successor trustee under
Section 9.06 hereunder and no notice to Holders of Certificates of the
appointment of co-trustee(s) or separate trustee(s) shall be required under
Section 9.08 hereof.
In the case of any appointment of a co-trustee or separate trustee
pursuant to this Section 9.10 all rights, powers, duties and obligations
conferred or imposed upon the Trustee shall be conferred or imposed upon and
exercised or performed by the Trustee and such separate trustee or co-trustee
jointly, except to the extent that under any law of any jurisdiction in which
any particular act or acts are to be performed by the Trustee (whether as
Trustee hereunder or as successor to a defaulting Master Servicer hereunder),
the Trustee shall be incompetent or unqualified to perform such act or acts, in
which event such rights, powers, duties and obligations (including the holding
of title to REMIC I or any portion thereof in any such jurisdiction) shall be
exercised and performed by such separate trustee or co-trustee at the direction
of the Trustee.
Any notice, request or other writing given to the Trustee shall be
deemed to have been given to each of the then separate trustees and co-trustees,
as effectively as if given to each of them. Every instrument appointing any
separate trustee or co-trustee shall refer to this Agreement and the conditions
of this Article IX. Each separate trustee and co-trustee, upon its acceptance of
the trust conferred, shall be vested with the estates or property specified in
its instrument of appointment, either jointly with the Trustee, or separately,
as may be provided therein, subject to all the provisions of this Agreement,
specifically including every provision of this Agreement relating to the conduct
of, affecting the liability of, or affording protection to, the Trustee. Every
such instrument shall be filed with the Trustee.
Any separate trustee or co-trustee may, at any time, constitute the
Trustee, its agent or attorney-in-fact, with full power and authority, to the
extent not prohibited by law, to do any lawful act under or in respect of this
Agreement on its behalf and in its name. If any separate trustee or co-trustee
shall die, become incapable of acting, resign or be removed, all of its estates,
properties, rights, remedies and trusts shall vest in and be exercised by the
Trustee, to the extent permitted by law, without the appointment of a new or
successor trustee or co-trustee.
SECTION 9.11. Appointment of Office or Agency.
The Certificates may be surrendered for registration of transfer or
exchange at the Securities Administrator's office located at Sixth and
Marquette, ▇▇▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇, and presented for final distribution at
the Corporate Trust Office of the Securities Administrator where notices and
demands to or upon the Securities Administrator in respect of the Certificates
and this Agreement may be served.
SECTION 9.12. Representations and Warranties.
The Trustee hereby represents and warrants to the Master Servicer, the
Securities Administrator, the Servicers and the Depositor as applicable, as of
the Closing Date, that:
(i) It is a national banking association duly organized,
validly existing and in good standing under the laws of the United
States of America.
(ii) The execution and delivery of this Agreement by it, and
the performance and compliance with the terms of this Agreement by it,
will not violate its articles of association or bylaws or constitute a
default (or an event which, with notice or lapse of time, or both,
would constitute a default) under, or result in the breach of, any
material agreement or other instrument to which it is a party or which
is applicable to it or any of its assets.
(iii) It has the full power and authority to enter into and
consummate all transactions contemplated by this Agreement, has duly
authorized the execution, delivery and performance of this Agreement,
and has duly executed and delivered this Agreement.
(iv) This Agreement, assuming due authorization, execution and
delivery by the other parties hereto, constitutes a valid, legal and
binding obligation of it, enforceable against it in accordance with the
terms hereof, subject to (A) applicable bankruptcy, insolvency,
receivership, reorganization, moratorium and other laws affecting the
enforcement of creditors' rights generally, and (B) general principles
of equity, regardless of whether such enforcement is considered in a
proceeding in equity or at law.
(v) It is not in violation of, and its execution and delivery
of this Agreement and its performance and compliance with the terms of
this Agreement will not constitute a violation of, any law, any order
or decree of any court or arbiter, or any order, regulation or demand
of any federal, state or local governmental or regulatory authority,
which violation, in its good faith and reasonable judgment, is likely
to affect materially and adversely either the ability of it to perform
its obligations under this Agreement or its financial condition.
(vi) No litigation is pending or, to the best of its
knowledge, threatened against it, which would prohibit it from entering
into this Agreement or, in its good faith reasonable judgment, is
likely to materially and adversely affect either the ability of it to
perform its obligations under this Agreement or its financial
condition.
ARTICLE X
TERMINATION
▇▇▇▇▇▇▇ ▇▇.▇▇. ▇▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇▇▇▇▇ or Liquidation of All
Mortgage Loans.
(a) Subject to Section 10.02 of this Agreement, the respective
obligations and responsibilities under this Agreement of the Depositor, the
Master Servicer, the Securities Administrator, the Servicer and the Trustee
(other than the obligations of the Master Servicer to the Trustee pursuant to
Section 9.05 of this Agreement and of the Servicers to make remittances to the
Securities Administrator and the Securities Administrator to make payments in
respect of the REMIC I Regular Interests, REMIC II Regular Interests or the
Classes of Certificates as hereinafter set forth) shall terminate upon payment
to the Certificateholders and the deposit of all amounts held by or on behalf of
the Trustee and required hereunder to be so paid or deposited on the
Distribution Date coinciding with or following the earlier to occur of (i) the
purchase by the Master Servicer of all Mortgage Loans and each REO Property
remaining in REMIC I and (ii) the final payment or other liquidation (or any
advance with respect thereto) of the last Mortgage Loan or REO Property
remaining in REMIC I; provided, however, that in no event shall the trust
created hereby continue beyond the earlier of (i) the expiration of 21 years
from the death of the last survivor of the descendants of ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇, the
late ambassador of the United States to the Court of St. ▇▇▇▇▇, living on the
date hereof and (ii) the Last Scheduled Distribution Date. The purchase by the
Master Servicer of all Mortgage Loans and each REO Property remaining in REMIC I
shall be at a price (the "Termination Price") equal to the sum of (i) the
greater of (A) the aggregate Purchase Price of all the Mortgage Loans included
in REMIC I, plus the appraised value of each REO Property, if any, included in
REMIC I, such appraisal to be conducted by an appraiser mutually agreed upon by
the Master Servicer and the Trustee in their reasonable discretion and (B) the
aggregate fair market value of all of the assets of REMIC I (as determined by
the Master Servicer and the Trustee, as of the close of business on the third
Business Day next preceding the date upon which notice of any such termination
is furnished to Certificateholders pursuant to the third paragraph of this
Section 10.01), (ii) any Swap Termination Payment payable to the Swap Provider
not due to a Swap Provider Trigger Event, which remains unpaid or which is due
to the exercise of the optional termination right by the Master Servicer plus
(iii) any amounts due the Servicers and the Master Servicer in respect of unpaid
Servicing Fees and outstanding P&I Advances and Servicing Advances.
(b) The Master Servicer shall have the right to purchase all of the
Mortgage Loans and each REO Property remaining in REMIC I pursuant to clause (i)
of the preceding paragraph no later than the Determination Date in the month
immediately preceding the Distribution Date on which the Certificates will be
retired; provided, however, that the Master Servicer may elect to purchase all
of the Mortgage Loans and each REO Property remaining in REMIC I pursuant to
clause (i) above only if the aggregate Scheduled Principal Balance of the
Mortgage Loans and each REO Property remaining in the Trust Fund at the time of
such election is reduced to less than or equal to 10% of the aggregate Scheduled
Principal Balance of the Mortgage Loans as of the Cut-off Date. By acceptance of
the Residual Certificates, the Holder of the Residual Certificates agrees, in
connection with any termination hereunder, to assign and transfer any portion of
the Termination Price in excess of par, and to the extent received in respect of
such termination, to pay any such amounts to the Holders of the Class CE
Certificates.
(c) Notice of the liquidation of the Certificates shall be given
promptly by the Securities Administrator by letter to the Certificateholders
mailed (a) in the event such notice is given in connection with the purchase of
the Mortgage Loans and each REO Property by the Master Servicer, not earlier
than the 15th day and not later than the 25th day of the month next preceding
the month of the final distribution on the Certificates or (b) otherwise during
the month of such final distribution on or before the Determination Date in such
month, in each case specifying (i) the Distribution Date upon which the Trust
Fund will terminate and the final payment in respect of the REMIC I Regular
Interests or the Certificates will be made upon presentation and surrender of
the related Certificates at the office of the Securities Administrator therein
designated, (ii) the amount of any such final payment, (iii) that no interest
shall accrue in respect of the REMIC I Regular Interests or Certificates from
and after the Interest Accrual Period relating to the final Distribution Date
therefor and (iv) that the Record Date otherwise applicable to such Distribution
Date is not applicable, payments being made only upon presentation and surrender
of the Certificates at the office of the Securities Administrator. In the event
such notice is given in connection with the purchase of all of the Mortgage
Loans and each REO Property remaining in REMIC I by the Master Servicer, the
Master Servicer shall deliver to the Securities Administrator for deposit in the
Distribution Account not later than the Business Day prior to the Distribution
Date on which the final distribution on the Certificates an amount in
immediately available funds equal to the above-described Termination Price. The
Securities Administrator shall remit to the Servicers, the Master Servicer, the
Trustee and the applicable Custodian from such funds deposited in the
Distribution Account (i) any amounts which the related Servicer would be
permitted to withdraw and retain from the Custodial Account pursuant to the
Servicing Agreement or from the Collection Account pursuant to Section 3.09 of
this Agreement, as applicable, as if such funds had been deposited therein
(including all unpaid Servicing Fees, Master Servicing Fees and all outstanding
P&I Advances and Servicing Advances) and (ii) any other amounts otherwise
payable by the Securities Administrator to the Master Servicer, the Trustee, the
applicable Custodian and the Servicers from amounts on deposit in the
Distribution Account pursuant to the terms of this Agreement or the Servicing
Agreement prior to making any final distributions pursuant to Section 10.01(d)
below. Upon certification to the Trustee by the Securities Administrator of the
making of such final deposit, the Trustee shall promptly release or cause to be
released to the Master Servicer the Mortgage Files for the remaining Mortgage
Loans, and Trustee shall execute all assignments, endorsements and other
instruments delivered to it and necessary to effectuate such transfer.
(d) Upon presentation of the Certificates by the Certificateholders on
the final Distribution Date, the Securities Administrator shall distribute to
each Certificateholder so presenting and surrendering its Certificates the
amount otherwise distributable on such Distribution Date in accordance with
Section 5.01 in respect of the Certificates so presented and surrendered. Any
funds not distributed to any Holder or Holders of Certificates being retired on
such Distribution Date because of the failure of such Holder or Holders to
tender their Certificates shall, on such date, be set aside and held in trust
and credited to the account of the appropriate non-tendering Holder or Holders.
If any Certificates as to which notice has been given pursuant to this Section
10.01 shall not have been surrendered for cancellation within six months after
the time specified in such notice, the Securities Administrator shall mail a
second notice to the remaining non-tendering Certificateholders to surrender
their Certificates for cancellation in order to receive the final distribution
with respect thereto. If within one year after the second notice all such
Certificates shall not have been surrendered for cancellation, the Securities
Administrator shall, directly or through an agent, mail a final notice to the
remaining non-tendering Certificateholders concerning surrender of their
Certificates. The costs and expenses of maintaining the funds in trust and of
contacting such Certificateholders shall be paid out of the assets remaining in
the trust funds. If within one (1) year after the final notice any such
Certificates shall not have been surrendered for cancellation, the Securities
Administrator shall pay to the Depositor all such amounts, and all rights of
non-tendering Certificateholders in or to such amounts shall thereupon cease. No
interest shall accrue or be payable to any Certificateholder on any amount held
in trust by the Securities Administrator as a result of such Certificateholder's
failure to surrender its Certificate(s) on the final Distribution Date for final
payment thereof in accordance with this Section 10.01. Any such amounts held in
trust by the Securities Administrator shall be held uninvested in an Eligible
Account.
SECTION 10.02. Additional Termination Requirements.
(a) In the event that the Master Servicer purchases all the Mortgage
Loans and each REO Property or the final payment on or other liquidation of the
last Mortgage Loan or REO Property remaining in REMIC I pursuant to Section
10.01, the Trust Fund shall be terminated in accordance with the following
additional requirements:
(i) The Trustee shall specify the first day in the 90-day
liquidation period in a statement attached to each Trust REMIC's final
Tax Return pursuant to Treasury regulation Section 1.860F-1 and shall
satisfy all requirements of a qualified liquidation under Section 860F
of the Code and any regulations thereunder, as evidenced by an Opinion
of Counsel obtained by and at the expense of the Master Servicer;
(ii) During such 90-day liquidation period and, at or prior to
the time of making of the final payment on the Certificates, the
Trustee shall sell all of the assets of REMIC I to the Master Servicer
for cash; and
(iii) At the time of the making of the final payment on the
Certificates, the Securities Administrator shall distribute or credit,
or cause to be distributed or credited, to the Holders of the Residual
Certificates all cash on hand in the Trust Fund (other than cash
retained to meet claims), and the Trust Fund shall terminate at that
time.
(b) At the expense of the Master Servicer (or, if the Trust Fund is
being terminated as a result of the occurrence of the event described in clause
(ii) of the first paragraph of Section 10.01, at the expense of the Trust Fund),
the Master Servicer shall prepare or cause to be prepared the documentation
required in connection with the adoption of a plan of liquidation of each Trust
REMIC pursuant to this Section 10.02.
(c) By their acceptance of Certificates, the Holders thereof hereby
agree to authorize the Trustee to specify the 90-day liquidation period for each
Trust REMIC, which authorization shall be binding upon all successor
Certificateholders.
ARTICLE XI
REMIC PROVISIONS
SECTION 11.01. REMIC Administration.
(a) The Trustee shall elect to treat each Trust REMIC as a REMIC under
the Code and, if necessary, under applicable state law. Each such election will
be made by the Securities Administrator on Form 1066 or other appropriate
federal tax or information return or any appropriate state return for the
taxable year ending on the last day of the calendar year in which the
Certificates are issued. For the purposes of the REMIC election in respect of
REMIC I, the REMIC I Regular Interests shall be designated as the Regular
Interests in REMIC I and the Class R-I Interest shall be designated as the
"residual interests" in REMIC I. For the purposes of the REMIC election in
respect of REMIC II, the REMIC II Regular Interests shall be designated as the
Regular Interests in REMIC II and the Class R-II Interest shall be designated as
the "residual interests" in REMIC II. The Class A Certificates, the Mezzanine
Certificates, the Class P Certificates and the Class CE Certificates (exclusive
of any right to receive payments from the Reserve Fund) shall be designated as
the Regular Interests in REMIC III and the Class R-III Interest shall be
designated as the Residual Interests in REMIC III. The Trustee shall not permit
the creation of any "interests" in each Trust REMIC (within the meaning of
Section 860G of the Code) other than the REMIC I Regular Interests, the REMIC II
Regular Interests and the interests represented by the Certificates.
(b) The Closing Date is hereby designated as the "Startup Day" of each
Trust REMIC within the meaning of Section 860G(a)(9) of the Code.
(c) The Securities Administrator shall be reimbursed for any and all
expenses relating to any tax audit of the Trust Fund (including, but not limited
to, any professional fees or any administrative or judicial proceedings with
respect to each Trust REMIC that involve the Internal Revenue Service or state
tax authorities), including the expense of obtaining any tax related Opinion of
Counsel except as specified herein. The Securities Administrator, as agent for
each Trust REMIC's tax matters person shall (i) act on behalf of the Trust Fund
in relation to any tax matter or controversy involving any Trust REMIC and (ii)
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 holder of the largest Percentage Interest of each Class of Residual
Certificates shall be designated, in the manner provided under Treasury
regulations section 1.860F-4(d) and Treasury regulations section
301.6231(a)(7)-1, as the tax matters person of the related REMIC created
hereunder. By their acceptance thereof, the holder of the largest Percentage
Interest of the Residual Certificates hereby agrees to irrevocably appoint the
Securities Administrator or an Affiliate as its agent to perform all of the
duties of the tax matters person for the Trust Fund.
(d) The Securities Administrator shall prepare and file and the Trustee
shall sign all of the Tax Returns in respect of each REMIC created hereunder.
The expenses of preparing and filing such returns shall be borne by the
Securities Administrator without any right of reimbursement therefor.
(e) The Securities Administrator shall perform on behalf of each Trust
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, as required by the Code, the REMIC Provisions or other
such compliance guidance, the Securities Administrator shall provide (i) to any
Transferor of a Residual Certificate such information as is necessary for the
application of any tax relating to the transfer of a Residual Certificate to any
Person who is not a Permitted Transferee upon receipt of additional reasonable
compensation, (ii) to the Certificateholders such information or reports as are
required by the Code or the REMIC Provisions including reports relating to
interest, original issue discount and market discount or premium (using the
Prepayment Assumption as required) and (iii) to the Internal Revenue Service the
name, title, address and telephone number of the person who will serve as the
representative of each Trust REMIC. The Depositor shall provide or cause to be
provided to the Securities Administrator, within ten (10) days after the Closing
Date, all information or data that the Securities Administrator reasonably
determines to be relevant for tax purposes as to the valuations and issue prices
of the Certificates, including, without limitation, the price, yield, prepayment
assumption and projected cash flow of the Certificates.
(f) To the extent in the control of the Trustee or the Securities
Administrator, each such Person (i) shall take such action and shall cause each
REMIC created hereunder to take such action as shall be necessary to create or
maintain the status thereof as a REMIC under the REMIC Provisions, (ii) shall
not take any action, cause the Trust Fund 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 (A) endanger the status of each Trust
REMIC as a REMIC or (B) result in the imposition of a tax upon the Trust Fund
(including but not limited to the tax on prohibited transactions as defined in
Section 860F(a)(2) of the Code and the tax on contributions to a REMIC set forth
in Section 860G(d) of the Code) (either such event, an "Adverse REMIC Event")
unless such action or inaction is permitted under this Agreement or the Trustee
and the Securities Administrator have received an Opinion of Counsel, addressed
to the them (at the expense of the party seeking to take such action but in no
event at the expense of the Trustee or the Securities Administrator) to the
effect that the contemplated action will not, with respect to any Trust REMIC,
endanger such status or result in the imposition of such a tax, nor (iii) shall
the Securities Administrator take or fail to take any action (whether or not
authorized hereunder) as to which the Trustee has advised it in writing that it
has received an Opinion of Counsel to the effect that an Adverse REMIC Event
could occur with respect to such action; provided that the Securities
Administrator may conclusively rely on such Opinion of Counsel and shall incur
no liability for its action or failure to act in accordance with such Opinion of
Counsel. In addition, prior to taking any action with respect to any Trust REMIC
or the respective assets of each, or causing any Trust REMIC to take any action,
which is not contemplated under the terms of this Agreement, the Securities
Administrator 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 Trust REMIC, and the Securities Administrator shall not take any
such action or cause any Trust REMIC to take any such action as to which the
Trustee has advised it in writing that an Adverse REMIC Event could occur. The
Trustee may consult with counsel to make such written advice, and the cost of
same shall be home by the party seeking to take the action not permitted by this
Agreement, but in no event shall such cost be an expense of the Trustee.
(g) In the event that any tax is imposed on "prohibited transactions"
of any REMIC created hereunder as defined in Section 860F(a)(2) of the Code, on
the "net income from foreclosure property" of such REMIC as defined in Section
860G(c) of the Code, on any contributions to any such REMIC after the Startup
Day therefor pursuant to Section 860G(d) of the Code, or any other tax is
imposed by the Code or any applicable provisions of state or local tax laws,
such tax shall be charged (i) to the Trustee pursuant to Section 11.03 of this
Agreement, if such tax arises out of or results from a breach by the Trustee of
any of its obligations under this Article XI, (ii) to the Securities
Administrator pursuant to Section 11.03, if such tax arises out of or results
from a breach by the Securities Administrator of any of its obligations under
this Article XI, (iii) to the Master Servicer pursuant to Section 11.03 of this
Agreement, if such tax arises out of or results from a breach by the Master
Servicer of any of its obligations under Article IV or under this Article XI,
(iv) to the related Servicer pursuant to Section 11.03 of this Agreement, if
such tax arises out of or results from a breach by such Servicer of any of its
obligations under Article III or under this Article XI, or (v) in all other
cases, against amounts on deposit in the Distribution Account and shall be paid
by withdrawal therefrom.
(h) The Securities Administrator shall, for federal income tax
purposes, maintain books and records with respect to each Trust REMIC on a
calendar year and on an accrual basis.
(i) Following the Startup Day, neither the Securities Administrator nor
the Trustee shall accept any contributions of assets to any Trust REMIC other
than in connection with any Qualified Substitute Mortgage Loan delivered in
accordance with Section 2.03 unless it shall have received an Opinion of Counsel
to the effect that the inclusion of such assets in the Trust Fund will not cause
the related REMIC to fail to qualify as a REMIC at any time that any
Certificates are outstanding or subject such REMIC to any tax under the REMIC
Provisions or other applicable provisions of federal, state and local law or
ordinances.
(j) Neither the Trustee nor the Securities Administrator shall
knowingly enter into any arrangement by which any Trust REMIC will receive a fee
or other compensation for services nor permit either REMIC to receive any income
from assets other than "qualified mortgages" as defined in Section 860G(a)(3) of
the Code or "permitted investments" as defined in Section 860G(a)(5) of the
Code.
(k) The Securities Administrator shall apply for an employer
identification number with the Internal Revenue Service via a Form SS-4 or other
comparable method for each REMIC. In connection with the foregoing, the
Securities Administrator shall provide the name and address of the person who
can be contacted to obtain information required to be reported to the holders of
Regular Interests in each REMIC as required by IRS Form 8811.
SECTION 11.02. Prohibited Transactions and Activities.
None of the Depositor, any Servicer, the Securities Administrator, the
Master Servicer or the Trustee shall sell, dispose of or substitute for any of
the Mortgage Loans (except in connection with (i) the foreclosure of a Mortgage
Loan, including but not limited to, the acquisition or sale of a Mortgaged
Property acquired by deed in lieu of foreclosure, (ii) the bankruptcy of REMIC
I, (iii) the termination of REMIC I pursuant to Article X of this Agreement,
(iv) a substitution pursuant to Article II of this Agreement or (v) a purchase
of Mortgage Loans pursuant to Article II of this Agreement), nor acquire any
assets for any Trust REMIC (other than REO Property acquired in respect of a
defaulted Mortgage Loan), nor sell or dispose of any investments in the
Collection Accounts, the Custodial Account or the Distribution Account for gain,
nor accept any contributions to any Trust REMIC after the Closing Date (other
than a Qualified Substitute Mortgage Loan delivered in accordance with Section
2.03), unless it has received an Opinion of Counsel, addressed to the Trustee
and the Securities Administrator (at the expense of the party seeking to cause
such sale, disposition, substitution, acquisition or contribution but in no
event at the expense of the Trustee) that such sale, disposition, substitution,
acquisition or contribution will not (a) affect adversely the status of any
Trust REMIC as a REMIC or (b) cause any Trust REMIC to be subject to a tax on
"prohibited transactions" or "contributions" pursuant to the REMIC Provisions.
SECTION 11.03. Indemnification.
(a) The Trustee agrees to be liable for any taxes and costs incurred by
the Trust Fund, the Depositor, the Master Servicer, the Securities Administrator
or the Servicers including, without limitation, any reasonable attorneys fees
imposed on or incurred by the Trust Fund, the Depositor, the Master Servicer,
the Securities Administrator or the Servicer as a result of the Trustee's
failure to perform its covenants set forth in this Article XI in accordance with
the standard of care of the Trustee set forth in this Agreement.
(b) Each Servicer party hereto agrees to indemnify the Trust Fund, the
Depositor, the Master Servicer, the Securities Administrator and the Trustee for
any taxes and costs including, without limitation, any reasonable attorneys'
fees imposed on or incurred by the Trust Fund, the Depositor, Countrywide the
Master Servicer, the Securities Administrator or the Trustee, as a result of
▇▇▇▇▇ Fargo's failure to perform its covenants set forth in Article III in
accordance with the standard of care of ▇▇▇▇▇ Fargo set forth in this Agreement.
(c) The Master Servicer agrees to indemnify the Trust Fund, the
Depositor, each Servicer party hereto and the Trustee for any taxes and costs
including, without limitation, any reasonable attorneys' fees imposed on or
incurred by the Trust Fund, the Depositor, the Servicers or the Trustee, as a
result of the Master Servicer's failure to perform its covenants set forth in
Article IV in accordance with the standard of care of the Master Servicer set
forth in this Agreement.
(d) The Securities Administrator agrees to be liable for any taxes and
costs incurred by the Trust Fund, the Depositor, any Servicer party hereto or
the Trustee including any reasonable attorneys' fees imposed on or incurred by
the Trust Fund, the Depositor, a Servicer or the Trustee as a result of the
Securities Administrator's failure to perform its covenants set forth in this
Article XI in accordance with the standard of care of the Securities
Administrator set forth in this Agreement.
ARTICLE XII
MISCELLANEOUS PROVISIONS
SECTION 12.01. Amendment.
This Agreement may be amended from time to time by the Depositor, ▇▇▇▇▇
Fargo, the Master Servicer, the Securities Administrator and the Trustee, with
the consent of the Swap Provider but without the consent of any of the
Certificateholders, (i) to cure any ambiguity or defect, (ii) to correct, modify
or supplement any provisions herein (including to give effect to the
expectations of Certificateholders), or (iii) to make any other provisions with
respect to matters or questions arising under this Agreement which shall not be
inconsistent with the provisions of this Agreement and that such action shall
not, as evidenced by an Opinion of Counsel delivered to the Trustee, adversely
affect in any material respect the interests of any Certificateholder; provided
that any such amendment shall be deemed not to adversely affect in any material
respect the interests of the Certificateholders and no such Opinion of Counsel
shall be required if the Person requesting such amendment obtains a letter from
each Rating Agency stating that such amendment would not result in the
downgrading or withdrawal of the respective ratings then assigned to the
Certificates. No amendment shall be deemed to adversely affect in any material
respect the interests of any Certificateholder who shall have consented thereto,
and no Opinion of Counsel shall be required to address the effect of any such
amendment on any such consenting Certificateholder.
This Agreement may also be amended from time to time by the Depositor,
each Servicer, the Master Servicer, the Securities Administrator and the Trustee
with the consent of the Swap Provider and the Holders of Certificates entitled
to at least 66% of the Voting Rights for the purpose of adding any provisions to
or changing in any manner or eliminating any of the provisions of this Agreement
or of modifying in any manner the rights of the Holders of Certificates;
provided, however, that no such amendment shall (i) reduce in any manner the
amount of, or delay the timing of, payments received on Mortgage Loans which are
required to be distributed on any Certificate without the consent of the Holder
of such Certificate, (ii) adversely affect in any material respect the interests
of the Holders of any Class of Certificates in a manner, other than as described
in (i), without the consent of the Holders of Certificates of such Class
evidencing at least 66% of the Voting Rights allocated to such Class, or (iii)
modify the consents required by the immediately preceding clauses (i) and (ii)
without the consent of the Holders of all Certificates then outstanding.
Notwithstanding any other provision of this Agreement, for purposes of the
giving or withholding of consents pursuant to this Section 12.01, Certificates
registered in the name of the Depositor or a Servicer or any Affiliate thereof
shall be entitled to Voting Rights with respect to matters affecting such
Certificates. Without limiting the generality of the foregoing, any amendment to
this Agreement required in connection with the compliance with or the
clarification of any reporting obligations described in Section 5.06 hereof
shall not require the consent of any Certificateholder and without the need for
any Opinion of Counsel or Rating Agency confirmation.
Notwithstanding any contrary provision of this Agreement, the Trustee
shall not consent to any amendment to this Agreement unless it shall have first
received an Opinion of Counsel to the effect that such amendment is permitted
hereunder and will not result in the imposition of any tax on any Trust REMIC
pursuant to the REMIC Provisions or cause any Trust REMIC to fail to qualify as
a REMIC at any time that any Certificates are outstanding and that such
amendment is authorized or permitted by this Agreement.
Promptly after the execution of any such amendment the Trustee shall
furnish a copy of such amendment to each Certificateholder.
It shall not be necessary for the consent of Certificateholders under
this Section 12.01 to approve the particular form of any proposed amendment, but
it shall be sufficient if such consent shall approve the substance thereof. The
manner of obtaining such consents and of evidencing the authorization of the
execution thereof by Certificateholders shall be subject to such reasonable
regulations as the Trustee may prescribe.
The cost of any Opinion of Counsel to be delivered pursuant to this
Section 12.01 shall be borne by the Person seeking the related amendment, but in
no event shall such Opinion of Counsel be an expense of the Trustee.
The Trustee may, but shall not be obligated to enter into any amendment
pursuant to this Section that affects its rights, duties and immunities under
this Agreement or otherwise.
SECTION 12.02. Recordation of Agreement; Counterparts.
To the extent permitted by applicable law, this Agreement is subject to
recordation in all appropriate public offices for real property records in all
the counties or other comparable jurisdictions in which any or all of the
properties subject to the Mortgages are situated, and in any other appropriate
public recording office or elsewhere, such recordation to be effected by the
Depositor at the expense of the Certificateholders, but only upon direction of
the Trustee accompanied by an Opinion of Counsel to the effect that such
recordation materially and beneficially affects the interests of the
Certificateholders.
For the purpose of facilitating the recordation of this Agreement as
herein provided and for other purposes, this Agreement may be executed
simultaneously in any number of counterparts, each of which counterparts shall
be deemed to be an original, and such counterparts shall constitute but one and
the same instrument.
SECTION 12.03. Limitation on Rights of Certificateholders.
The death or incapacity of any Certificateholder shall not operate to
terminate this Agreement or the Trust Fund, nor entitle such Certificateholder's
legal representatives or heirs to claim an accounting or to take any action or
proceeding in any court for a partition or winding up of the Trust Fund, nor
otherwise affect the rights, obligations and liabilities of the parties hereto
or any of them.
No Certificateholder shall have any right to vote (except as expressly
provided for herein) or in any manner otherwise control the operation and
management of the Trust Fund, or the obligations of the parties hereto, nor
shall anything herein set forth, or contained in the terms of any 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.
No Certificateholder shall have any right by virtue 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 such Holder previously
shall have given to the Trustee a written notice of default and of the
continuance thereof, as hereinbefore provided, and unless also the Holders of
Certificates entitled to at least 25% of the Voting Rights 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 costs, expenses and
liabilities to be incurred therein or thereby, and the Trustee, for 15 days
after its receipt of such notice, request and offer of indemnity, shall have
neglected or refused to institute any such action, suit or proceeding. It is
understood and intended, and 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 whatsoever by virtue 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 equal,
ratable and common benefit of all Certificateholders. For the protection and
enforcement of the provisions of this Section, each and every Certificateholder
and the Trustee shall be entitled to such relief as can be given either at law
or in equity.
SECTION 12.04. Governing Law.
This Agreement shall be 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
conflicts of laws principles thereof other than Section 5-1401 of the New York
General Obligations Law which shall govern.
SECTION 12.05. Notices.
All directions, demands and notices hereunder shall be in writing and
shall be deemed to have been duly given when received if sent by facsimile,
receipt confirmed, if personally delivered at or mailed by first class mail,
postage prepaid, or by express delivery service or delivered in any other manner
specified herein, to (a) in the case of the Depositor, ACE Securities Corp.,
AMACAR GROUP, ▇▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇, ▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇▇▇▇▇
▇▇▇▇▇, Attention: ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇ (telecopy number: (▇▇▇) ▇▇▇-▇▇▇▇), or such
other address or telecopy number as may hereafter be furnished to the Servicers,
the Master Servicer, the Securities Administrator and the Trustee in writing by
the Depositor, (b) in the case of ▇▇▇▇▇ Fargo, ▇▇▇▇▇ Fargo Bank, National
Association, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇ ▇▇▇▇▇-▇▇▇▇, Attention: ACE
2005-HE7, or such other address or telecopy number as may hereafter be furnished
to Countrywide, the Trustee, the Master Servicer, the Securities Administrator
and the Depositor in writing by ▇▇▇▇▇ Fargo, (c) in the case of the Master
Servicer and the Securities Administrator, ▇.▇. ▇▇▇ ▇▇, ▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇ ▇▇▇▇▇
and for overnight delivery to ▇▇▇▇ ▇▇▇ ▇▇▇▇▇▇▇▇▇ ▇▇▇▇, ▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇ ▇▇▇▇▇,
Attention: Ace Securities Corp., 2005-HE7 (telecopy number: (▇▇▇) ▇▇▇-▇▇▇▇), or
such other address or telecopy number as may hereafter be furnished to the
Trustee, the Depositor and the Servicers in writing by the Master Servicer or
the Securities Administrator and (d) in the case of the Trustee, at the
Corporate Trust Office or such other address or telecopy number as the Trustee
may hereafter be furnish to the Servicers, the Master Servicer, the Securities
Administrator and the Depositor in writing by the Trustee. Any notice required
or permitted to be given to a Certificateholder shall be given by first class
mail, postage prepaid, at the address of such Holder as shown in the Certificate
Register. Any notice so mailed within the time prescribed in this Agreement
shall be conclusively presumed to have been duly given when mailed, whether or
not the Certificateholder receives such notice. A copy of any notice required to
be telecopied hereunder also shall be mailed to the appropriate party in the
manner set forth above.
SECTION 12.06. Severability of Provisions.
If any one or more of the covenants, agreements, provisions or terms of
this Agreement shall be for any reason whatsoever held invalid, then such
covenants, agreements, provisions or terms shall be deemed severable from the
remaining covenants, agreements, provisions or terms of this Agreement and shall
in no way affect the validity or enforceability of the other provisions of this
Agreement or of the Certificates or the rights of the Holders thereof.
SECTION 12.07. Notice to Rating Agencies.
The Trustee shall use its best efforts promptly to provide notice to
the Rating Agencies with respect to each of the following of which a Responsible
Officer has actual knowledge:
1. Any material change or amendment to this Agreement;
2. The occurrence of any Servicer Event of Default or Master
Servicer Event of Default that has not been cured or waived;
3. The resignation or termination of a Servicer, the Master
Servicer or the Trustee;
4. The repurchase or substitution of Mortgage Loans pursuant
to or as contemplated by Section 2.03 of this Agreement;
5. The final payment to the Holders of any Class of
Certificates;
6. Any change in the location of the Distribution Account; and
7. Any event that would result in the inability of the Master
Servicer or the Trustee, as applicable, as successor Servicer to make
advances regarding delinquent Mortgage Loans.
In addition, the Securities Administrator shall promptly make available
to each Rating Agency copies of each report to Certificateholders described in
Section 5.02 of this Agreement.
▇▇▇▇▇ Fargo shall make available to each Rating Agency copies of the
following:
1. Each annual statement as to compliance described in Section
3.17 of this Agreement; and
2. Each annual independent public accountants' servicing
report described in Section 3.18 of this Agreement.
Any such notice pursuant to this Section 12.07 shall be in writing and
shall be deemed to have been duly given if personally delivered at or mailed by
first class mail, postage prepaid, or by express delivery service to Standard &
Poor's, a division of the ▇▇▇▇▇▇-▇▇▇▇ Companies, Inc., ▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇
▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇; and to ▇▇▇▇▇'▇ Investors Service, Inc., ▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇▇,
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇ or such other addresses as the Rating Agencies may
designate in writing to the parties hereto.
SECTION 12.08. Article and Section References.
All article and section references used in this Agreement, unless
otherwise provided, are to articles and sections in this Agreement.
SECTION 12.09. Grant of Security Interest.
It is the express intent of the parties hereto that the conveyance of
the Mortgage Loans by the Depositor to the Trustee, on behalf of the Trust and
for the benefit of the Certificateholders, be, and be construed as, a sale of
the Mortgage Loans by the Depositor and not a pledge of the Mortgage Loans to
secure a debt or other obligation of the Depositor. However, in the event that,
notwithstanding the aforementioned intent of the parties, the Mortgage Loans are
held to be property of the Depositor, then, (a) it is the express intent of the
parties that such conveyance be deemed a pledge of the Mortgage Loans by the
Depositor to the Trustee, on behalf of the Trust and for the benefit of the
Certificateholders, to secure a debt or other obligation of the Depositor and
(b)(1) this Agreement shall also be deemed to be a security agreement within the
meaning of Articles 8 and 9 of the Uniform Commercial Code as in effect from
time to time in the State of New York; (2) the conveyance provided for in
Section 2.01 shall be deemed to be a grant by the Depositor to the Trustee, on
behalf of the Trust and for the benefit of the Certificateholders, of a security
interest in all of the Depositor's right, title and interest in and to the
Mortgage Loans and all amounts payable to the holders of the Mortgage Loans in
accordance with the terms thereof and all proceeds of the conversion, voluntary
or involuntary, of the foregoing into cash, instruments, securities or other
property, including without limitation all amounts, other than investment
earnings, from time to time held or invested in the Collection Account and the
Distribution Account, whether in the form of cash, instruments, securities or
other property; (3) the obligations secured by such security agreement shall be
deemed to be all of the Depositor's obligations under this Agreement, including
the obligation to provide to the Certificateholders the benefits of this
Agreement relating to the Mortgage Loans and the Trust Fund; and (4)
notifications to persons holding such property, and acknowledgments, receipts or
confirmations from persons holding such property, shall be deemed notifications
to, or acknowledgments, receipts or confirmations from, financial
intermediaries, bailees or agents (as applicable) of the Trustee for the purpose
of perfecting such security interest under applicable law. Accordingly, the
Depositor hereby grants to the Trustee, on behalf of the Trust and for the
benefit of the Certificateholders, a security interest in the Mortgage Loans and
all other property described in clause (2) of the preceding sentence, for the
purpose of securing to the Trustee the performance by the Depositor of the
obligations described in clause (3) of the preceding sentence. Notwithstanding
the foregoing, the parties hereto intend the conveyance pursuant to Section 2.01
to be a true, absolute and unconditional sale of the Mortgage Loans and assets
constituting the Trust Fund by the Depositor to the Trustee, on behalf of the
Trust and for the benefit of the Certificateholders.
SECTION 12.10. Survival of Indemnification.
Any and all indemnities to be provided by any party to this Agreement
shall survive the termination and resignation of any party hereto and the
termination of this Agreement.
SECTION 12.11. Servicing Agreement.
With respect to the Servicing Agreement, in the event of any conflict
between the provisions of this Agreement and the provisions of the Servicing
Agreement, the provisions of the Servicing Agreement shall control.
IN WITNESS WHEREOF, the Depositor, ▇▇▇▇▇ Fargo, the Master Servicer,
the Securities Administrator and the Trustee have caused their names to be
signed hereto by their respective officers thereunto duly authorized, in each
case as of the day and year first above written.
ACE SECURITIES CORP.,
as Depositor
By: /s/ ▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇▇
------------------------------
Name: ▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇▇
Title: Vice President
By: /s/ ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇
------------------------------
Name: ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇
Title: President
▇▇▇▇▇ FARGO BANK, NATIONAL ASSOCIATION
as a Servicer
By: /s/ ▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇
------------------------------
Name: ▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇
Title: Vice President
HSBC BANK USA, NATIONAL ASSOCIATION
not in its individual capacity but solely
as Trustee
By: /s/ ▇▇▇▇▇ ▇▇▇
------------------------------
Name: ▇▇▇▇▇ ▇▇▇
Title: Vice President
▇▇▇▇▇ FARGO BANK, N.A.
as Master Servicer and Securities
Administrator
By: /s/ ▇▇▇▇▇▇ ▇▇▇▇▇▇
------------------------------
Name: ▇▇▇▇▇▇ ▇▇▇▇▇▇
Title: Vice President
ACKNOWLEDGED AND AGREED FOR PURPOSES OF
SECTION 9.05:
DB STRUCTURED PRODUCTS, INC
By: /s/ ▇▇▇▇ ▇▇▇▇▇▇▇▇
------------------------------
Name: ▇▇▇▇ ▇▇▇▇▇▇▇▇
Title: Director
By: /s/ ▇▇▇▇▇ ▇▇▇▇▇▇▇
------------------------------
Name: ▇▇▇▇▇ ▇▇▇▇▇▇▇
Title: Director
ACKNOWLEDGED AND AGREED FOR PURPOSES OF
SECTION 7.08 AND 7.09:
▇▇▇▇▇▇▇ FIXED INCOME SERVICES INC.
By: /s/ ▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇
------------------------------
Name: ▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇
Title: President and General Counsel
STATE OF )
) ss.:
COUNTY OF )
On the ___ day of November 2005, before me, a notary public in and for
said State, personally appeared _____________________ known to me to be a
_____________________ of ACE Securities Corp., one of the corporations that
executed the within instrument, and also known to me to be the person who
executed it on behalf of said corporation, and acknowledged to me that such
corporation executed the within instrument.
IN WITNESS WHEREOF, I have hereunto set my hand and affixed my official
seal the day and year in this certificate first above written.
_________________________________________
Notary Public
[Notarial Seal] My commission expires
STATE OF )
) ss.:
COUNTY OF )
On the ___ day of November 2005, before me, a notary public in and for
said State, personally appeared _____________________ known to me to be a
_____________________ of ACE Securities Corp., one of the corporations that
executed the within instrument, and also known to me to be the person who
executed it on behalf of said corporation, and acknowledged to me that such
corporation executed the within instrument.
IN WITNESS WHEREOF, I have hereunto set my hand and affixed my official
seal the day and year in this certificate first above written.
_________________________________________
Notary Public
[Notarial Seal] My commission expires
STATE OF )
) ss.:
COUNTY OF )
On the ___ day of November 2005, before me, a notary public in and for
said State, personally appeared _____________________ known to me to be a
_____________________ of ▇▇▇▇▇ Fargo Bank, National Association, one of the
nationally banking associations that executed the within instrument, and also
known to me to be the person who executed it on behalf of said federally
chartered savings bank, and acknowledged to me that such federally chartered
savings bank executed the within instrument.
IN WITNESS WHEREOF, I have hereunto set my hand and affixed my official
seal the day and year in this certificate first above written.
_________________________________________
Notary Public
[Notarial Seal] My commission expires
STATE OF )
) ss.:
COUNTY OF )
On the ___ day of November 2005, before me, a notary public in and for
said State, personally appeared _____________________ known to me to be a
_____________________ of ▇▇▇▇▇ Fargo Bank, N.A., one of the national banking
associations that executed the within instrument, and also known to me to be the
person who executed it on behalf of said national banking association, and
acknowledged to me that such national banking association executed the within
instrument.
IN WITNESS WHEREOF, I have hereunto set my hand and affixed my official
seal the day and year in this certificate first above written.
_________________________________________
Notary Public
[Notarial Seal] My commission expires
STATE OF )
) ss.:
COUNTY OF )
On the ___ day of November 2005, before me, a notary public in and for
said State, personally appeared _____________________ known to me to be a
_____________________ of HSBC Bank USA, National Association, one of the
national banking associations that executed the within instrument, and also
known to me to be the person who executed it on behalf of said national banking
association, and acknowledged to me that such national banking association
executed the within instrument.
IN WITNESS WHEREOF, I have hereunto set my hand and affixed my official
seal the day and year in this certificate first above written.
_________________________________________
Notary Public
[Notarial Seal] My commission expires
EXHIBIT A-1
FORM OF CLASS A-[1A][1B1][1B2][2A][2B][2C][2D] CERTIFICATE
SOLELY FOR U.S. FEDERAL INCOME TAX PURPOSES, THIS CERTIFICATE IS A "REGULAR
INTEREST" IN A "REAL ESTATE MORTGAGE INVESTMENT CONDUIT," AS THOSE TERMS ARE
DEFINED, RESPECTIVELY, IN SECTIONS 860G AND 860D OF THE INTERNAL REVENUE CODE OF
1986 (THE "CODE").
UNLESS THIS CERTIFICATE IS PRESENTED BY AN AUTHORIZED REPRESENTATIVE OF THE
DEPOSITORY TRUST COMPANY TO THE DEPOSITOR OR ITS AGENT FOR REGISTRATION OF
TRANSFER, EXCHANGE OR PAYMENT, AND ANY CERTIFICATE ISSUED IS REGISTERED IN THE
NAME OF CEDE & CO. OR SUCH OTHER NAME AS REQUESTED BY AN AUTHORIZED
REPRESENTATIVE OF THE DEPOSITORY TRUST COMPANY AND ANY PAYMENT IS MADE TO CEDE &
CO., ANY TRANSFER, PLEDGE OR OTHER USE HEREOF FOR VALUE OR OTHERWISE BY OR TO
ANY PERSON IS WRONGFUL SINCE THE REGISTERED OWNER HEREOF, CEDE & CO., HAS AN
INTEREST HEREIN.
PRIOR TO THE TERMINATION OF THE SUPPLEMENTAL INTEREST TRUST, ANY PERSON
ACQUIRING A CERTIFICATE DIRECTLY OR INDIRECTLY BY, ON BEHALF OF, OR WITH PLAN
ASSETS OF AN EMPLOYEE BENEFIT PLAN OR OTHER RETIREMENT ARRANGEMENT THAT IS
SUBJECT TO TITLE I OF THE EMPLOYEE RETIREMENT INCOME SECURITY ACT OF 1974, AS
AMENDED, OR SECTION 4975 OF THE INTERNAL REVENUE CODE OF 1986, SHALL BE DEEMED
TO HAVE MADE THE REPRESENTATIONS IN SECTION 6.02(C) OF THE POOLING AND SERVICING
AGREEMENT.
Series 2005-HE7, Class A- Aggregate Certificate Principal Balance of the
[1A][1B1][1B2][2A][2B][2C][2D] Class A-[1A][1B1][1B2][2A][2B][2C][2D]
Certificates as of
the Issue Date:
$_____________
Pass-Through Rate: Variable Denomination: $____________
Date of Pooling and Servicing Agreement and
Master Servicer: ▇▇▇▇▇ Fargo Bank, N.A.
Cut-off Date: November 1, 2005
First Distribution Date: Trustee: HSBC Bank USA, National Association
November 25, 2005 Issue Date: November 28, 2005
No.__ CUSIP:________________
DISTRIBUTIONS IN REDUCTION OF THE CERTIFICATE PRINCIPAL BALANCE OF THIS
CERTIFICATE MAY BE MADE MONTHLY AS SET FORTH HEREIN. ACCORDINGLY, THE
OUTSTANDING CERTIFICATE PRINCIPAL BALANCE HEREOF AT ANY TIME MAY BE LESS
THAN THE AMOUNT SHOWN ABOVE AS THE DENOMINATION OF THIS CERTIFICATE.
ACE SECURITIES CORP. HOME EQUITY LOAN TRUST, SERIES 2005-HE7
ASSET BACKED PASS-THROUGH CERTIFICATE
evidencing a beneficial ownership interest in a Trust Fund (the "Trust Fund")
consisting primarily of a pool of conventional one- to four-family, fixed and
adjustable-rate first lien mortgage loans (the "Mortgage Loans") formed and sold
by
ACE SECURITIES CORP.
THIS CERTIFICATE DOES NOT REPRESENT AN OBLIGATION OF OR INTEREST IN ACE
SECURITIES CORP., THE MASTER SERVICER, THE SECURITIES ADMINISTRATOR, THE
SERVICER, THE TRUSTEE OR ANY OF THEIR RESPECTIVE AFFILIATES. NEITHER THIS
CERTIFICATE NOR THE UNDERLYING MORTGAGE LOANS ARE GUARANTEED BY ANY AGENCY
OR INSTRUMENTALITY OF THE UNITED STATES.
This certifies that ________________ is the registered owner of a
Percentage Interest (obtained by dividing the denomination of this Certificate
by the aggregate Certificate Principal Balance of the Class
A-[1A][1B1][1B2][2A][2B][2C][2D] Certificates as of the Issue Date) in that
certain beneficial ownership interest evidenced by all the Class
A-[1A][1B1][1B2][2A][2B][2C][2D] Certificates in REMIC III created pursuant to a
Pooling and Servicing Agreement, dated as specified above (the "Agreement"),
among ACE Securities Corp., as depositor (hereinafter called the "Depositor",
which term includes any successor entity under the Agreement), ▇▇▇▇▇ Fargo Bank,
N.A. as master servicer (the "Master Servicer") and securities administrator
(the "Securities Administrator"), ▇▇▇▇▇ Fargo Bank, N.A. as servicer (the
"Servicer") and HSBC Bank USA, National Association as trustee (the "Trustee"),
a summary of certain of the pertinent provisions of which is set forth
hereafter. To the extent not defined herein, the capitalized terms used herein
have the meanings assigned in the Agreement. This Certificate is issued under
and is subject to the terms, provisions and conditions of the Agreement, to
which Agreement the Holder of this Certificate by virtue of the acceptance
hereof assents and by which such Holder is bound.
Pursuant to the terms of the Agreement, distributions will be made on the
25th day of each month or, if such 25th day is not a Business Day, the Business
Day immediately following such 25th day (a "Distribution Date"), commencing on
the First Distribution Date specified above, to the Person in whose name this
Certificate is registered on the Business Day immediately preceding such
Distribution Date (the "Record Date"), in an amount equal to the product of the
Percentage Interest evidenced by this Certificate and the amount required to be
distributed to the Holders of Class A-[1A][1B1][1B2][2A][2B][2C][2D]
Certificates on such Distribution Date pursuant to the Agreement.
All distributions to the Holder of this Certificate under the Agreement
will be made or caused to be made by the Securities Administrator by wire
transfer in immediately available funds to the account of the Person entitled
thereto if such Person shall have so notified the Securities Administrator in
writing at least five Business Days prior to the Record Date immediately prior
to such Distribution Date and is the registered owner of Class
A-[1A][1B1][1B2][2A][2B][2C][2D] Certificates the aggregate initial Certificate
Principal Balance of which is in excess of the lesser of (i) $5,000,000 or (ii)
two-thirds of the aggregate initial Certificate Principal Balance of the Class
A-[1A][1B1][1B2][2A][2B][2C][2D] Certificates, or otherwise by check mailed by
first class mail to the address of the Person entitled thereto, as such name and
address shall appear on the Certificate Register. Notwithstanding the above, the
final distribution on this Certificate will be made after due notice by the
Securities Administrator of the pendency of such distribution and only upon
presentation and surrender of this Certificate at the office or agency appointed
by the Securities Administrator for that purpose as provided in the Agreement.
The Pass-Through Rate applicable to the calculation of interest payable
with respect to this Certificate on any Distribution Date shall be a rate per
annum equal to the lesser of (i) One-Month LIBOR plus [_____]%, in the case of
each Distribution Date through and including the Distribution Date on which the
aggregate Scheduled Principal Balance of the Mortgage Loans (and properties
acquired in respect thereof) remaining in the Trust Fund is reduced to less than
or equal to 10% of the aggregate Scheduled Principal Balance of the Mortgage
Loans as of the Cut-off Date, or One-Month LIBOR plus [_____]%, in the case of
any Distribution Date thereafter and (ii) the applicable Net WAC Pass-Through
Rate for such Distribution Date.
This Certificate is one of a duly authorized issue of Certificates
designated as Asset Backed Pass-Through Certificate of the Series specified on
the face hereof (herein called the "Certificates") and representing a Percentage
Interest in the Class of Certificates specified on the face hereof equal to the
denomination specified on the face hereof divided by the aggregate Certificate
Principal Balance of the Class of Certificates specified on the face hereof.
The Certificates are limited in right of payment to certain collections and
recoveries respecting the Mortgage Loans and payments received pursuant to the
Swap Agreement, all as more specifically set forth herein and in the Agreement.
As provided in the Agreement, withdrawals from the Collection Account and the
Distribution Account may be made from time to time for purposes other than
distributions to Certificateholders, such purposes including reimbursement of
advances made, or certain expenses incurred, with respect to the Mortgage Loans.
The Agreement permits, with certain exceptions therein provided, the
amendment thereof and the modification of the rights and obligations of the
Depositor, the Master Servicer, the Trustee, the Securities Administrator, the
Servicer and the rights of the Certificateholders under the Agreement at any
time by the Depositor, the Master Servicer, the Trustee, the Securities
Administrator and the Servicer with the consent of the Holders of Certificates
entitled to at least 66% of the Voting Rights. Any such consent by the Holder of
this Certificate shall be conclusive and binding on such Holder and upon all
future Holders of this Certificate and of any Certificate issued upon the
transfer hereof or in exchange herefor or in lieu hereof whether or not notation
of such consent is made upon this Certificate. The Agreement also permits the
amendment thereof, in certain limited circumstances, without the consent of the
Holders of any of the Certificates.
As provided in the Agreement and subject to certain limitations therein set
forth, the transfer of this Certificate is registrable in the Certificate
Register upon surrender of this Certificate for registration of transfer at the
offices or agencies appointed by the Securities Administrator as provided in the
Agreement, duly endorsed by, or accompanied by an assignment in the form below
or other written instrument of transfer in form satisfactory to the Securities
Administrator duly executed by, the Holder hereof or such Holder's attorney duly
authorized in writing, and thereupon one or more new Certificates of the same
Class in authorized denominations evidencing the same aggregate Percentage
Interest will be issued to the designated transferee or transferees.
Prior to the termination of the Supplemental Interest Trust, any transfer
of this Certificate to a Plan subject to ERISA or Section 4975 of the Code, any
Person acting, directly or indirectly, on behalf of any such Plan or any person
using Plan Assets to acquire this Certificate by its acceptance thereof shall be
deemed to make the representations in Section 6.02(c) of the Agreement.
The Certificates are issuable in fully registered form only without coupons
in Classes and denominations representing Percentage Interests specified in the
Agreement. As provided in the Agreement and subject to certain limitations
therein set forth, the Certificates are exchangeable for new Certificates of the
same Class in authorized denominations evidencing the same aggregate Percentage
Interest, as requested by the Holder surrendering the same.
Any transferee of this Certificate shall be deemed to make the
representations set forth in Section 6.02(c) of the Agreement.
No service charge will be made for any such registration of transfer or
exchange of Certificates, but the Securities Administrator may require payment
of a sum sufficient to cover any tax or other governmental charge that may be
imposed in connection with any transfer or exchange of Certificates.
The Depositor, the Master Servicer, the Trustee, the Securities
Administrator, the Servicer and any agent of the Depositor, the Master Servicer,
the Trustee, the Securities Administrator or the Servicer may treat the Person
in whose name this Certificate is registered as the owner hereof for all
purposes, and none of the Depositor, the Master Servicer, the Trustee, the
Securities Administrator, the Servicer nor any such agent shall be affected by
notice to the contrary.
The obligations created by the Agreement and the Trust Fund created thereby
shall terminate upon payment to the Certificateholders of all amounts held by
the Securities Administrator and required to be paid to them pursuant to the
Agreement following the earlier of (i) the final payment or other liquidation
(or any advance with respect thereto) of the last Mortgage Loan remaining in
REMIC I and (ii) the purchase by the party designated in the Agreement at a
price determined as provided in the Agreement from REMIC I of all the Mortgage
Loans and all property acquired in respect of such Mortgage Loans. The Agreement
permits, but does not require, the party designated in the Agreement to purchase
from REMIC I all the Mortgage Loans and all property acquired in respect of any
Mortgage Loan at a price determined as provided in the Agreement. The exercise
of such right will effect early retirement of the Certificates; however, such
right to purchase is subject to the aggregate Scheduled Principal Balance of the
Mortgage Loans (and properties acquired in respect thereof) at the time of
purchase being less than or equal to 10% of the aggregate principal balance of
the Mortgage Loans as of the Cut-off Date.
The recitals contained herein shall be taken as statements of the Depositor
and neither the Trustee nor the Securities Administrator assumes any
responsibility for their correctness.
Unless the certificate of authentication hereon has been executed by the
Securities Administrator, by manual signature, this Certificate shall not be
entitled to any benefit under the Agreement or be valid for any purpose.
IN WITNESS WHEREOF, the Securities Administrator has caused this
Certificate to be duly executed.
Dated:
▇▇▇▇▇ FARGO BANK, N.A.
as Securities Administrator
By:_______________________________
Authorized Officer
CERTIFICATE OF AUTHENTICATION
This is one of the Class A-[1A][1B1][1B2][2A][2B][2C][2D] Certificates
referred to in the within-mentioned Agreement.
▇▇▇▇▇ FARGO BANK, N.A.
as Securities Administrator
By:_______________________________
Authorized Signatory
ABBREVIATIONS
The following abbreviations, when used in the inscription on the face of
this instrument, shall be construed as though they were written out in full
according to applicable laws or regulations:
TEN COM - as tenants in common UNIF GIFT MIN ACT - CUSTODIAN
-------------------
(Cust) (Minor)
under Uniform Gifts
to Minors Act
TEN ENT - as tenants by the entireties -------------------
(State)
JT TEN - as joint tenants with right
if survivorship and not as
tenants in common
Additional abbreviations may also be used though not in the above list.
ASSIGNMENT
FOR VALUE RECEIVED, the undersigned hereby sell(s), assign(s) and
transfer(s) unto
---------------------------------------------------------------------
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
(Please print or typewrite name, address including postal zip code, and Taxpayer
Identification Number of assignee)
a Percentage Interest equal to ____% evidenced by the within Asset Backed
Pass-Through Certificate and hereby authorize(s) the registration of transfer of
such interest to assignee on the Certificate Register of the Trust Fund.
I (we) further direct the Securities Administrator to issue a new
Certificate of a like Percentage Interest and Class to the above named assignee
and deliver such Certificate to the following address:
------------------------------------------------
----------------------------------------------------------------------------- .
Dated: -------------------------------------
Signature by or on behalf of assignor
-------------------------------------
Signature Guaranteed
DISTRIBUTION INSTRUCTIONS
--------------------------------------------------------------------------------
The assignee should include the following for purposes of distribution:
Distributions shall be made, by wire transfer or otherwise, in immediately
available funds to
--------------------------------------------------------------------------------
for the account of
--------------------------------------------------------------
account number or, if mailed by check, to
-----------------------------------
--------------------------------------------------------------------------------
Applicable statements should be mailed to
--------------------------------------
--------------------------------------------------------------------------------
This information is provided by
--------------------------------------------
assignee named above, or
--------------------------------------------------------
its agent.
EXHIBIT A-2
FORM OF CLASS M-[1][2][3][4][5][6][7][8][9][10][11] CERTIFICATE
SOLELY FOR U.S. FEDERAL INCOME TAX PURPOSES, THIS CERTIFICATE IS A
"REGULAR INTEREST" IN A "REAL ESTATE MORTGAGE INVESTMENT CONDUIT," AS
THOSE TERMS ARE DEFINED, RESPECTIVELY, IN SECTIONS 860G AND 860D OF THE
INTERNAL REVENUE CODE OF 1986 (THE "CODE").
UNLESS THIS CERTIFICATE IS PRESENTED BY AN AUTHORIZED REPRESENTATIVE OF
THE DEPOSITORY TRUST COMPANY TO THE DEPOSITOR OR ITS AGENT FOR
REGISTRATION OF TRANSFER, EXCHANGE OR PAYMENT, AND ANY CERTIFICATE
ISSUED IS REGISTERED IN THE NAME OF CEDE & CO. OR SUCH OTHER NAME AS
REQUESTED BY AN AUTHORIZED REPRESENTATIVE OF THE DEPOSITORY TRUST
COMPANY AND ANY PAYMENT IS MADE TO CEDE & CO., ANY TRANSFER, PLEDGE OR
OTHER USE HEREOF FOR VALUE OR OTHERWISE BY OR TO ANY PERSON IS WRONGFUL
SINCE THE REGISTERED OWNER HEREOF, CEDE & CO., HAS AN INTEREST HEREIN.
THIS CERTIFICATE IS SUBORDINATE TO THE CLASS A CERTIFICATES [[,/AND]
CLASS M-1 CERTIFICATES [,/AND] CLASS M-2 CERTIFICATES[,/AND] CLASS M-3
CERTIFICATES [,/AND] CLASS M-4 CERTIFICATES [,/AND] CLASS M-5
CERTIFICATES [,/AND] CLASS M-6 CERTIFICATES [,/AND] CLASS M-7
CERTIFICATES [,/AND] CLASS M-8 CERTIFICATES [,/AND] CLASS M-9
CERTIFICATES [AND] CLASS M-10 CERTIFICATES] TO THE EXTENT DESCRIBED IN
THE AGREEMENT REFERRED TO HEREIN.
ANY TRANSFEREE OF THIS CERTIFICATE SHALL BE DEEMED TO MAKE THE
REPRESENTATIONS SET FORTH IN SECTION 6.02(C) OF THE AGREEMENT REFERRED
TO HEREIN.
THE CERTIFICATE PRINCIPAL BALANCE OF THIS CERTIFICATE WILL BE DECREASED
BY THE PRINCIPAL PAYMENTS HEREON AND REALIZED LOSSES ALLOCABLE HERETO
AS DESCRIBED IN THE AGREEMENT REFERRED TO HEREIN. ACCORDINGLY,
FOLLOWING THE INITIAL ISSUANCE OF THE CERTIFICATES, THE CERTIFICATE
PRINCIPAL BALANCE OF THIS CERTIFICATE WILL BE DIFFERENT FROM THE
DENOMINATION SHOWN BELOW. ANYONE ACQUIRING THIS CERTIFICATE MAY
ASCERTAIN ITS CERTIFICATE PRINCIPAL BALANCE BY INQUIRY OF THE
SECURITIES ADMINISTRATOR NAMED HEREIN.
ANY PERSON ACQUIRING A CERTIFICATE DIRECTLY OR INDIRECTLY BY, ON BEHALF
OF, OR WITH PLAN ASSETS OF AN EMPLOYEE BENEFIT PLAN OR OTHER RETIREMENT
ARRANGEMENT THAT IS SUBJECT TO TITLE I OF THE EMPLOYEE RETIREMENT
INCOME SECURITY ACT OF 1974, AS AMENDED, OR SECTION 4975 OF THE
INTERNAL REVENUE CODE OF 1986, SHALL BE DEEMED TO HAVE MADE THE
REPRESENTATIONS IN SECTION 6.02(C) OF THE POOLING AND SERVICING
AGREEMENT.
Series 2005-HE7, Class Aggregate Certificate Principal
M-[1][2][3][4][5][6][7][8][9][10][11] Balance of the Class M-
[1][2][3][4][5][6][7][8][9][10][11]
Certificates as of the Issue Date:
$______________
Pass-Through Rate: Variable Denomination: $______________
Date of Pooling and Servicing Agreement Master Servicer:
and Cut-off Date: November 1, 2005 ▇▇▇▇▇ Fargo Bank, N.A.
First Distribution Date: November 25, 2005 Trustee: HSBC Bank USA, National
Association
No.___ Issue Date: November 28, 2005
CUSIP:_________________
ACE SECURITIES CORP. HOME EQUITY LOAN TRUST, SERIES 2005-HE7
ASSET BACKED PASS-THROUGH CERTIFICATE
evidencing a beneficial ownership interest in a Trust Fund (the "Trust Fund")
consisting primarily of a pool of conventional one- to four-family, fixed and
adjustable-rate first lien mortgage loans (the "Mortgage Loans") formed and sold
by
ACE SECURITIES CORP.
THIS CERTIFICATE DOES NOT REPRESENT AN OBLIGATION OF OR INTEREST IN ACE
SECURITIES CORP., THE MASTER SERVICER, THE SECURITIES ADMINISTRATOR, THE
SERVICER, THE TRUSTEE OR ANY OF THEIR RESPECTIVE AFFILIATES. NEITHER THIS
CERTIFICATE NOR THE UNDERLYING MORTGAGE LOANS ARE GUARANTEED BY ANY AGENCY
OR INSTRUMENTALITY OF THE UNITED STATES.
This certifies that _____________________ is the registered owner of a
Percentage Interest (obtained by dividing the denomination of this Certificate
by the aggregate Certificate Principal Balance of the Class
M-[1][2][3][4][5][6][7][8][9][10][11] Certificates as of the Issue Date) in that
certain beneficial ownership interest evidenced by all the Class
M-[1][2][3][4][5][6][7][8][9][10][11] Certificates in REMIC III created pursuant
to a Pooling and Servicing Agreement, dated as specified above (the
"Agreement"), among ACE Securities Corp., as depositor (hereinafter called the
"Depositor", which term includes any successor entity under the Agreement),
▇▇▇▇▇ Fargo Bank, N.A. as master servicer (the "Master Servicer") and securities
administrator (the "Securities Administrator"), ▇▇▇▇▇ Fargo Bank, N.A. as
servicer (the "Servicer") and HSBC Bank USA, National Association as trustee
(the "Trustee"), a summary of certain of the pertinent provisions of which is
set forth hereafter. To the extent not defined herein, the capitalized terms
used herein have the meanings assigned in the Agreement. This Certificate is
issued under and is subject to the terms, provisions and conditions of the
Agreement, to which Agreement the Holder of this Certificate by virtue of the
acceptance hereof assents and by which such Holder is bound.
Pursuant to the terms of the Agreement, distributions will be made on the
25th day of each month or, if such 25th day is not a Business Day, the Business
Day immediately following such 25th day (a "Distribution Date"), commencing on
the First Distribution Date specified above, to the Person in whose name this
Certificate is registered on the Business Day immediately preceding such
Distribution Date (the "Record Date"), in an amount equal to the product of the
Percentage Interest evidenced by this Certificate and the amount required to be
distributed to the Holders of Class M-[1][2][3][4][5][6][7][8][9][10][11]
Certificates on such Distribution Date pursuant to the Agreement.
All distributions to the Holder of this Certificate under the Agreement
will be made or caused to be made by the Securities Administrator by wire
transfer in immediately available funds to the account of the Person entitled
thereto if such Person shall have so notified the Securities Administrator in
writing at least five Business Days prior to the Record Date immediately prior
to such Distribution Date and is the registered owner of Class
M-[1][2][3][4][5][6][7][8][9][10][11] Certificates the aggregate initial
Certificate Principal Balance of which is in excess of the lesser of (i)
$5,000,000 or (ii) two-thirds of the aggregate initial Certificate Principal
Balance of the Class M-[1][2][3][4][5][6][7][8][9][10][11] Certificates, or
otherwise by check mailed by first class mail to the address of the Person
entitled thereto, as such name and address shall appear on the Certificate
Register. Notwithstanding the above, the final distribution on this Certificate
will be made after due notice by the Securities Administrator of the pendency of
such distribution and only upon presentation and surrender of this Certificate
at the office or agency appointed by the Securities Administrator for that
purpose as provided in the Agreement.
The Pass-Through Rate applicable to the calculation of interest payable
with respect to this Certificate on any Distribution Date shall equal a rate per
annum equal to the lesser of (i) One-Month LIBOR plus [____]% , in the case of
each Distribution Date through and including the Distribution Date on which the
aggregate Scheduled Principal Balance of the Mortgage Loans (and properties
acquired in respect thereof) remaining in the Trust Fund is reduced to less than
or equal to 10% of the aggregate Scheduled Principal Balance of the Mortgage
Loans as of the Cut-off Date, or One-Month LIBOR plus [____]%, in the case of
any Distribution Date thereafter and (ii) the applicable Net WAC Pass-Through
Rate for such Distribution Date.
This Certificate is one of a duly authorized issue of Certificates
designated as Asset Backed Pass-Through Certificate of the Series specified on
the face hereof (herein called the "Certificates") and representing a Percentage
Interest in the Class of Certificates specified on the face hereof equal to the
denomination specified on the face hereof divided by the aggregate Certificate
Principal Balance of the Class of Certificates specified on the face hereof.
The Certificates are limited in right of payment to certain collections and
recoveries respecting the Mortgage Loans and payments received pursuant to the
Swap Agreement, all as more specifically set forth herein and in the Agreement.
As provided in the Agreement, withdrawals from the Collection Account and the
Distribution Account may be made from time to time for purposes other than
distributions to Certificateholders, such purposes including reimbursement of
advances made, or certain expenses incurred, with respect to the Mortgage Loans.
The Agreement permits, with certain exceptions therein provided, the
amendment thereof and the modification of the rights and obligations of the
Depositor, the Master Servicer, the Trustee, the Securities Administrator, the
Servicer and the rights of the Certificateholders under the Agreement at any
time by the Depositor, the Master Servicer, the Trustee, the Securities
Administrator and the Servicer with the consent of the Holders of Certificates
entitled to at least 66% of the Voting Rights. Any such consent by the Holder of
this Certificate shall be conclusive and binding on such Holder and upon all
future Holders of this Certificate and of any Certificate issued upon the
transfer hereof or in exchange herefor or in lieu hereof whether or not notation
of such consent is made upon this Certificate. The Agreement also permits the
amendment thereof, in certain limited circumstances, without the consent of the
Holders of any of the Certificates.
As provided in the Agreement and subject to certain limitations therein set
forth, the transfer of this Certificate is registrable in the Certificate
Register upon surrender of this Certificate for registration of transfer at the
offices or agencies appointed by the Securities Administrator as provided in the
Agreement, duly endorsed by, or accompanied by an assignment in the form below
or other written instrument of transfer in form satisfactory to the Securities
Administrator duly executed by, the Holder hereof or such Holder's attorney duly
authorized in writing, and thereupon one or more new Certificates of the same
Class in authorized denominations evidencing the same aggregate Percentage
Interest will be issued to the designated transferee or transferees.
The Certificates are issuable in fully registered form only without coupons
in Classes and denominations representing Percentage Interests specified in the
Agreement. As provided in the Agreement and subject to certain limitations
therein set forth, the Certificates are exchangeable for new Certificates of the
same Class in authorized denominations evidencing the same aggregate Percentage
Interest, as requested by the Holder surrendering the same.
Any transferee of this Certificate shall be deemed to make the
representations set forth in Section 6.02(c) of the Agreement.
No service charge will be made for any such registration of transfer or
exchange of Certificates, but the Securities Administrator may require payment
of a sum sufficient to cover any tax or other governmental charge that may be
imposed in connection with any transfer or exchange of Certificates.
The Depositor, the Master Servicer, the Trustee, the Securities
Administrator, the Servicer and any agent of the Depositor, the Master Servicer,
the Trustee, the Securities Administrator or the Servicer may treat the Person
in whose name this Certificate is registered as the owner hereof for all
purposes, and none of the Depositor, the Master Servicer, the Trustee, the
Securities Administrator, the Servicer nor any such agent shall be affected by
notice to the contrary.
The obligations created by the Agreement and the Trust Fund created thereby
shall terminate upon payment to the Certificateholders of all amounts held by
the Securities Administrator and required to be paid to them pursuant to the
Agreement following the earlier of (i) the final payment or other liquidation
(or any advance with respect thereto) of the last Mortgage Loan remaining in
REMIC I and (ii) the purchase by the party designated in the Agreement at a
price determined as provided in the Agreement from REMIC I of all the Mortgage
Loans and all property acquired in respect of such Mortgage Loans. The Agreement
permits, but does not require, the party designated in the Agreement to purchase
from REMIC I all the Mortgage Loans and all property acquired in respect of any
Mortgage Loan at a price determined as provided in the Agreement. The exercise
of such right will effect early retirement of the Certificates; however, such
right to purchase is subject to the aggregate Scheduled Principal Balance of the
Mortgage Loans (and properties acquired in respect thereof) at the time of
purchase being less than or equal to 10% of the aggregate principal balance of
the Mortgage Loans as of the Cut-off Date.
The recitals contained herein shall be taken as statements of the Depositor
and neither the Trustee nor the Securities Administrator assume any
responsibility for their correctness.
Unless the certificate of authentication hereon has been executed by the
Securities Administrator by manual signature, this Certificate shall not be
entitled to any benefit under the Agreement or be valid for any purpose.
IN WITNESS WHEREOF, the Securities Administrator has caused this
Certificate to be duly executed.
Dated:
▇▇▇▇▇ FARGO BANK, N.A.
as Securities Administrator
By:________________________
Authorized Officer
CERTIFICATE OF AUTHENTICATION
This is one of the Class M-[1][2][3][4][5][6][7][8][9][10][11] Certificates
referred to in the within-mentioned Agreement.
▇▇▇▇▇ FARGO BANK, N.A.
as Securities Administrator
By:________________________
Authorized Signatory
ABBREVIATIONS
The following abbreviations, when used in the inscription on the face of
this instrument, shall be construed as though they were written out in full
according to applicable laws or regulations:
TEN COM - as tenants in common UNIF GIFT MIN ACT - CUSTODIAN
-------------------
(Cust) (Minor)
under Uniform Gifts
to Minors Act
TEN ENT - as tenants by the entireties -------------------
(State)
JT TEN - as joint tenants with right
if survivorship and not as
tenants in common
Additional abbreviations may also be used though not in the above list.
ASSIGNMENT
FOR VALUE RECEIVED, the undersigned hereby sell(s), assign(s) and
transfer(s) unto
----------------------------------------------------------------
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
(Please print or typewrite name, address including postal zip code, and Taxpayer
Identification Number of assignee)
a Percentage Interest equal to _____% evidenced by the within Asset Backed
Pass-Through Certificate and hereby authorize(s) the registration of transfer of
such interest to assignee on the Certificate Register of the Trust Fund.
I (we) further direct the Securities Administrator to issue a new
Certificate of a like Percentage Interest and Class to the above named assignee
and deliver such Certificate to the following address:
--------------------------------------------------------------------------------
----------------------------------------------------------------------------- .
Dated:
-------------------------------------
Signature by or on behalf of assignor
-------------------------------------
Signature Guaranteed
DISTRIBUTION INSTRUCTIONS
The assignee should include the following for purposes of distribution:
Distributions shall be made, by wire transfer or otherwise, in immediately
available funds to
-------------------------------------------------------------
--------------------------------------------------------------------------------
for the account of
--------------------------------------------------------------
account number or, if mailed by check, to
-----------------------------------
--------------------------------------------------------------------------------
Applicable statements should be mailed to
------------------------------
--------------------------------------------------------------------------------
This information is provided by
-------------------------------------------------
assignee named above, or
--------------------------------------------------------
its agent.
EXHIBIT A-3
FORM OF CLASS CE CERTIFICATE
SOLELY FOR U.S. FEDERAL INCOME TAX PURPOSES, THIS CERTIFICATE IS A
"REGULAR INTEREST" IN A "REAL ESTATE MORTGAGE INVESTMENT CONDUIT," AS
THOSE TERMS ARE DEFINED, RESPECTIVELY, IN SECTIONS 860G AND 860D OF THE
INTERNAL REVENUE CODE OF 1986 (THE "CODE").
THIS CERTIFICATE IS SUBORDINATE TO THE CLASS A CERTIFICATES AND THE
MEZZANINE CERTIFICATES TO THE EXTENT DESCRIBED IN THE AGREEMENT
REFERRED TO HEREIN.
THIS CERTIFICATE HAS NOT BEEN AND WILL NOT BE REGISTERED UNDER THE
SECURITIES ACT OF 1933, AS AMENDED (THE "ACT"), OR UNDER ANY STATE
SECURITIES LAWS. THE HOLDER HEREOF, BY PURCHASING THIS CERTIFICATE,
AGREES THAT THIS CERTIFICATE MAY BE REOFFERED, RESOLD, PLEDGED OR
OTHERWISE TRANSFERRED ONLY IN COMPLIANCE WITH THE SECURITIES ACT AND
OTHER APPLICABLE LAWS AND (1) OUTSIDE OF THE UNITED STATES WITHIN THE
MEANING OF AND IN COMPLIANCE WITH REGULATION S UNDER THE ACT
("REGULATION S"), OR (2) WITHIN THE UNITED STATES TO (A) "QUALIFIED
INSTITUTIONAL BUYERS" WITHIN THE MEANING OF AND IN COMPLIANCE WITH RULE
144A UNDER THE ACT ("RULE 144A") OR (B) TO INSTITUTIONAL INVESTORS THAT
ARE "ACCREDITED INVESTORS" WITHIN THE MEANING OF RULE 501(A)(1), (2),
(3) OR (7) OF "REGULATION D" UNDER THE ACT.
NO TRANSFER OF THIS CERTIFICATE TO AN EMPLOYEE BENEFIT PLAN OR OTHER
RETIREMENT ARRANGEMENT SUBJECT TO THE EMPLOYEE RETIREMENT INCOME
SECURITY ACT OF 1974, AS AMENDED, OR THE CODE WILL BE REGISTERED EXCEPT
IN COMPLIANCE WITH THE PROCEDURES DESCRIBED HEREIN.
NO TRANSFER OF THIS CERTIFICATE MAY BE MADE TO ANY PERSON, UNLESS THE
TRANSFEREE PROVIDES A CERTIFICATION PURSUANT TO SECTION 6.02(C) OF THE
AGREEMENT.
Series 2005-HE7, Class CE Aggregate Certificate Principa Balance
of the Class CE Certificates as of the
Issue Date: $-------------
Pass-Through Rate: Variable Denomination: $_________________
Cut-off Date and date of Pooling and Master Servicer: ▇▇▇▇▇ Fargo Bank, N.A.
Servicing Agreement: November 1, 2005
First Distribution Date: Trustee: HSBC Bank USA, National
November 25, 2005 Association
No. __ Issue Date: November 28, 2005
ACE SECURITIES CORP. HOME EQUITY LOAN TRUST, SERIES 2005-HE7
ASSET BACKED PASS-THROUGH CERTIFICATE
evidencing a beneficial ownership interest in a Trust Fund (the "Trust Fund")
consisting primarily of a pool of conventional one- to four-family, fixed and
adjustable-rate, first lien mortgage loans (the "Mortgage Loans") formed and
sold by
ACE SECURITIES CORP.
THIS CERTIFICATE DOES NOT REPRESENT AN OBLIGATION OF OR INTEREST IN
ACE SECURITIES CORP., THE MASTER SERVICER, THE SECURITIES
ADMINISTRATOR, THE SERVICER, THE TRUSTEE OR ANY OF THEIR RESPECTIVE
AFFILIATES. NEITHER THIS CERTIFICATE NOR THE UNDERLYING MORTGAGE LOANS
ARE GUARANTEED BY ANY AGENCY OR INSTRUMENTALITY OF THE UNITED STATES.
This certifies that ________________ is the registered owner of a
Percentage Interest (obtained by dividing the denomination of this Certificate
by the aggregate Certificate Principal Balance of the Class CE Certificates as
of the Issue Date) in that certain beneficial ownership interest evidenced by
all the Class CE Certificates in REMIC III created pursuant to a Pooling and
Servicing Agreement, dated as specified above (the "Agreement"), among ACE
Securities Corp., as depositor (hereinafter called the "Depositor," which term
includes any successor entity under the Agreement), ▇▇▇▇▇ Fargo Bank, N.A. as
master servicer (the "Master Servicer") and securities administrator (the
"Securities Administrator"), ▇▇▇▇▇ Fargo Bank, N.A. as servicer (the "Servicer")
and HSBC Bank USA, National Association as trustee (the "Trustee"), a summary of
certain of the pertinent provisions of which is set forth hereafter. To the
extent not defined herein, the capitalized terms used herein have the meanings
assigned in the Agreement. This Certificate is issued under and is subject to
the terms, provisions and conditions of the Agreement, to which Agreement the
Holder of this Certificate by virtue of the acceptance hereof assents and by
which such Holder is bound.
Interest on this Certificate will accrue during the month prior to the
month in which a Distribution Date (as hereinafter defined) occurs on the
Notional Amount (as defined in the Agreement) hereof at a per annum rate equal
to the Pass-Through Rate as set forth in the Agreement. Pursuant to the terms of
the Agreement, distributions will be made on the 25th day of each month or, if
such 25th day is not a Business Day, the Business Day immediately following such
25th day (a "Distribution Date"), commencing on the First Distribution Date
specified above, to the Person in whose name this Certificate is registered on
the last Business Day of the calendar month immediately preceding the month in
which the related Distribution Date occurs (the "Record Date"), in an amount
equal to the product of the Percentage Interest evidenced by this Certificate
and the amount required to be distributed to the Holders of Class CE
Certificates on such Distribution Date pursuant to the Agreement.
All distributions to the Holder of this Certificate under the Agreement
will be made or caused to be made by the Securities Administrator by wire
transfer in immediately available funds to the account of the Person entitled
thereto if such Person shall have so notified the Securities Administrator in
writing at least five Business Days prior to the Record Date immediately prior
to such Distribution Date and is the registered owner of Class CE Certificates
the aggregate initial Certificate Principal Balance of which is in excess of the
lesser of (i) $5,000,000 or (ii) two-thirds of the aggregate initial Certificate
Principal Balance of the Class CE Certificates, or otherwise by check mailed by
first class mail to the address of the Person entitled thereto, as such name and
address shall appear on the Certificate Register. Notwithstanding the above, the
final distribution on this Certificate will be made after due notice by the
Securities Administrator of the pendency of such distribution and only upon
presentation and surrender of this Certificate at the office or agency appointed
by the Securities Administrator for that purpose as provided in the Agreement.
This Certificate is one of a duly authorized issue of Certificates
designated as Asset Backed Pass-Through Certificate of the Series specified on
the face hereof (herein called the "Certificates") and representing a Percentage
Interest in the Class of Certificates specified on the face hereof equal to the
denomination specified on the face hereof divided by the aggregate Certificate
Principal Balance of the Class of Certificates specified on the face hereof.
The Certificates are limited in right of payment to certain collections and
recoveries respecting the Mortgage Loans, all as more specifically set forth
herein and in the Agreement. As provided in the Agreement, withdrawals from the
Collection Account and the Distribution Account may be made from time to time
for purposes other than distributions to Certificateholders, such purposes
including reimbursement of advances made, or certain expenses incurred, with
respect to the Mortgage Loans.
The Agreement permits, with certain exceptions therein provided, the
amendment thereof and the modification of the rights and obligations of the
Depositor, the Master Servicer, the Trustee, the Securities Administrator, the
Servicer and the rights of the Certificateholders under the Agreement at any
time by the Depositor, the Master Servicer, the Trustee, the Securities
Administrator and the Servicer with the consent of the Holders of Certificates
entitled to at least 66% of the Voting Rights. Any such consent by the Holder of
this Certificate shall be conclusive and binding on such Holder and upon all
future Holders of this Certificate and of any Certificate issued upon the
transfer hereof or in exchange herefor or in lieu hereof whether or not notation
of such consent is made upon this Certificate. The Agreement also permits the
amendment thereof, in certain limited circumstances, without the consent of the
Holders of any of the Certificates.
As provided in the Agreement and subject to certain limitations therein set
forth, the transfer of this Certificate is registrable in the Certificate
Register upon surrender of this Certificate for registration of transfer at the
offices or agencies appointed by the Securities Administrator as provided in the
Agreement, duly endorsed by, or accompanied by an assignment in the form below
or other written instrument of transfer in form satisfactory to the Securities
Administrator duly executed by, the Holder hereof or such Holder's attorney duly
authorized in writing, and thereupon one or more new Certificates of the same
Class in authorized denominations evidencing the same aggregate Percentage
Interest will be issued to the designated transferee or transferees.
No transfer of this Certificate shall be made unless the transfer is made
pursuant to an effective registration statement under the Securities Act of
1933, as amended (the "1933 Act"), and an effective registration or
qualification under applicable state securities laws, or is made in a
transaction that does not require such registration or qualification. In the
event that such a transfer of this Certificate is to be made without
registration or qualification, the Securities Administrator shall require
receipt of (i) if such transfer is purportedly being made in reliance upon Rule
144A or Regulation S under the 1933 Act, written certifications from the Holder
of the Certificate desiring to effect the transfer, and from such Holder's
prospective transferee, substantially in the forms attached to the Agreement as
Exhibit B-1, (ii) if such transfer is purportedly being made in reliance upon
Rule 501(a) under the 1933 Act, written certifications from the Holder of the
Certificate desiring to effect the transfer and from such Holder's prospective
transferee, substantially in the form attached to the Agreement as Exhibit B-2
and (iii) in all other cases, an Opinion of Counsel satisfactory to it that such
transfer may be made without such registration or qualification (which Opinion
of Counsel shall not be an expense of the Trust Fund or of the Depositor, the
Trustee, the Master Servicer or the Securities Administrator in their respective
capacities as such), together with copies of the written certification(s) of the
Holder of the Certificate desiring to effect the transfer and/or such Holder's
prospective transferee upon which such Opinion of Counsel is based. None of the
Depositor, the Trustee or the Securities Administrator is obligated to register
or qualify the Class of Certificates specified on the face hereof under the 1933
Act or any other securities law or to take any action not otherwise required
under the Agreement to permit the transfer of such Certificates without
registration or qualification. Any Holder desiring to effect a transfer of this
Certificate shall be required to indemnify the Trustee, the Depositor, the
Master Servicer and the Securities Administrator against any liability that may
result if the transfer is not so exempt or is not made in accordance with such
federal and state laws.
No transfer of this Certificate to a Plan subject to ERISA or Section 4975
of the Code, any Person acting, directly or indirectly, on behalf of any such
Plan or any Person using "Plan Assets" to acquire this Certificate shall be made
except in accordance with Section 6.02(c) of the Agreement.
The Certificates are issuable in fully registered form only without coupons
in Classes and denominations representing Percentage Interests specified in the
Agreement. As provided in the Agreement and subject to certain limitations
therein set forth, the Certificates are exchangeable for new Certificates of the
same Class in authorized denominations evidencing the same aggregate Percentage
Interest, as requested by the Holder surrendering the same. No service charge
will be made for any such registration of transfer or exchange of Certificates,
but the Securities Administrator may require payment of a sum sufficient to
cover any tax or other governmental charge that may be imposed in connection
with any transfer or exchange of Certificates.
The Depositor, the Master Servicer, the Trustee, the Securities
Administrator, the Servicer and any agent of the Depositor, the Master Servicer,
the Trustee, the Securities Administrator or the Servicer may treat the Person
in whose name this Certificate is registered as the owner hereof for all
purposes, and none of the Depositor, the Master Servicer, the Trustee, the
Securities Administrator, the Servicer nor any such agent shall be affected by
notice to the contrary.
The obligations created by the Agreement and the Trust Fund created thereby
shall terminate upon payment to the Certificateholders of all amounts held by
the Securities Administrator and required to be paid to them pursuant to the
Agreement following the earlier of (i) the final payment or other liquidation
(or any advance with respect thereto) of the last Mortgage Loan remaining in
REMIC I and (ii) the purchase by the party designated in the Agreement at a
price determined as provided in the Agreement from REMIC I of all the Mortgage
Loans and all property acquired in respect of such Mortgage Loans. The Agreement
permits, but does not require, the party designated in the Agreement to purchase
from REMIC I all the Mortgage Loans and all property acquired in respect of any
Mortgage Loan at a price determined as provided in the Agreement. The exercise
of such right will effect early retirement of the Certificates; however, such
right to purchase is subject to the aggregate Scheduled Principal Balance of the
Mortgage Loans (and properties acquired in respect thereof) at the time of
purchase being less than or equal to 10% of the aggregate principal balance of
the Mortgage Loans as of the Cut-off Date.
The recitals contained herein shall be taken as statements of the Depositor
and neither the Trustee nor the Securities Administrator assume any
responsibility for their correctness.
Unless the certificate of authentication hereon has been executed by the
Securities Administrator, by manual signature, this Certificate shall not be
entitled to any benefit under the Agreement or be valid for any purpose.
IN WITNESS WHEREOF, the Securities Administrator has caused this
Certificate to be duly executed.
Dated:
▇▇▇▇▇ FARGO BANK, N.A.
as Securities Administrator
By:________________________
Authorized Officer
CERTIFICATE OF AUTHENTICATION
This is one of the Class CE Certificates referred to in the
within-mentioned Agreement.
▇▇▇▇▇ FARGO BANK, N.A.
as Securities Administrator
By:________________________
Authorized Officer
ABBREVIATIONS
The following abbreviations, when used in the inscription on the face of
this instrument, shall be construed as though they were written out in full
according to applicable laws or regulations:
TEN COM - as tenants in common UNIF GIFT MIN ACT - CUSTODIAN
-------------------
(Cust) (Minor)
under Uniform Gifts
to Minors Act
TEN ENT - as tenants by the entireties -------------------
(State)
JT TEN - as joint tenants with right
if survivorship and not as
tenants in common
Additional abbreviations may also be used though not in the above list.
ASSIGNMENT
FOR VALUE RECEIVED, the undersigned hereby sell(s), assign(s) and
transfer(s) unto
----------------------------------------------------------------
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
(Please print or typewrite name, address including postal zip code, and Taxpayer
Identification Number of assignee)
(Please print or typewrite name, address including postal zip code, and Taxpayer
Identification Number of assignee)
a Percentage Interest equal to _____% evidenced by the within Asset Backed
Pass-Through Certificate and hereby authorize(s) the registration of transfer of
such interest to assignee on the Certificate Register of the Trust Fund.
I (we) further direct the Securities Administrator to issue a new
Certificate of a like Percentage Interest and Class to the above named assignee
and deliver such Certificate to the following address:
--------------------------------------------------------------------------------
----------------------------------------------------------------------------- .
Dated:
-------------------------------------
Signature by or on behalf of assignor
-------------------------------------
Signature Guaranteed
DISTRIBUTION INSTRUCTIONS
The assignee should include the following for purposes of distribution:
Distributions shall be made, by wire transfer or otherwise, in immediately
available funds to
-------------------------------------------------------------
--------------------------------------------------------------------------------
for the account of
--------------------------------------------------------------
account number or, if mailed by check, to
-----------------------------------
--------------------------------------------------------------------------------
Applicable statements should be mailed to
------------------------------
--------------------------------------------------------------------------------
This information is provided by
-------------------------------------------------
assignee named above, or
--------------------------------------------------------
its agent.
EXHIBIT A-4
FORM OF CLASS P CERTIFICATE
SOLELY FOR U.S. FEDERAL INCOME TAX PURPOSES, THIS CERTIFICATE IS A
"REGULAR INTEREST" IN A "REAL ESTATE MORTGAGE INVESTMENT CONDUIT," AS
THOSE TERMS ARE DEFINED, RESPECTIVELY, IN SECTIONS 860G AND 860D OF THE
INTERNAL REVENUE CODE OF 1986 (THE "CODE").
THIS CERTIFICATE HAS NOT BEEN AND WILL NOT BE REGISTERED UNDER THE
SECURITIES ACT OF 1933, AS AMENDED (THE "ACT"), OR UNDER ANY STATE
SECURITIES LAWS. THE HOLDER HEREOF, BY PURCHASING THIS CERTIFICATE,
AGREES THAT THIS CERTIFICATE MAY BE REOFFERED, RESOLD, PLEDGED OR
OTHERWISE TRANSFERRED ONLY IN COMPLIANCE WITH THE SECURITIES ACT AND
OTHER APPLICABLE LAWS AND (1) OUTSIDE OF THE UNITED STATES WITHIN THE
MEANING OF AND IN COMPLIANCE WITH REGULATION S UNDER THE ACT
("REGULATION S"), OR (2) WITHIN THE UNITED STATES TO (A) "QUALIFIED
INSTITUTIONAL BUYERS" WITHIN THE MEANING OF AND IN COMPLIANCE WITH RULE
144A UNDER THE ACT ("RULE 144A") OR (B) TO INSTITUTIONAL INVESTORS THAT
ARE "ACCREDITED INVESTORS" WITHIN THE MEANING OF RULE 501(A)(1), (2),
(3) OR (7) OF "REGULATION D" UNDER THE ACT.
NO TRANSFER OF THIS CERTIFICATE TO AN EMPLOYEE BENEFIT PLAN OR OTHER
RETIREMENT ARRANGEMENT SUBJECT TO THE EMPLOYEE RETIREMENT INCOME
SECURITY ACT OF 1974, AS AMENDED, OR THE CODE WILL BE REGISTERED EXCEPT
IN COMPLIANCE WITH THE PROCEDURES DESCRIBED HEREIN.
NO TRANSFER OF THIS CERTIFICATE MAY BE MADE TO ANY PERSON, UNLESS THE
TRANSFEREE PROVIDES A CERTIFICATION PURSUANT TO SECTION 6.02(C) OF THE
AGREEMENT.
Series 2005-HE7, Class P Aggregate Certificate
Principal Balance of the
Class P Certificates as of
the Issue Date: $100.00
Cut-off Date and date of Pooling Denomination: $100.00
and Servicing Agreement: November 1, 2005
First Distribution Date: November 25, 2005 Master Servicer:
▇▇▇▇▇ Fargo Bank, N.A.
No. __ Trustee: HSBC Bank USA,
National Association
Issue Date:
November 28, 2005
ACE SECURITIES CORP. HOME EQUITY LOAN TRUST, SERIES 2005-HE7
ASSET BACKED PASS-THROUGH CERTIFICATE
evidencing a beneficial ownership interest in a Trust Fund (the "Trust Fund")
consisting primarily of a pool of conventional one- to four-family, fixed and
adjustable-rate, first lien mortgage loans (the "Mortgage Loans") formed and
sold by
ACE SECURITIES CORP.
THIS CERTIFICATE DOES NOT REPRESENT AN OBLIGATION OF OR INTEREST
IN ACE SECURITIES CORP., THE MASTER SERVICER, THE SECURITIES
ADMINISTRATOR, THE SERVICER, THE TRUSTEE OR ANY OF THEIR
RESPECTIVE AFFILIATES. NEITHER THIS CERTIFICATE NOR THE
UNDERLYING MORTGAGE LOANS ARE GUARANTEED BY ANY AGENCY OR
INSTRUMENTALITY OF THE UNITED STATES.
This certifies that____________________ is the registered owner of a
Percentage Interest (obtained by dividing the denomination of this Certificate
by the aggregate Certificate Principal Balance of the Class P Certificates as of
the Issue Date) in that certain beneficial ownership interest evidenced by all
the Class P Certificates in REMIC III created pursuant to a Pooling and
Servicing Agreement, dated as specified above (the "Agreement"), among ACE
Securities Corp., as depositor (hereinafter called the "Depositor", which term
includes any successor entity under the Agreement), ▇▇▇▇▇ Fargo Bank, N.A. as
master servicer (the "Master Servicer") and securities administrator (the
"Securities Administrator"), ▇▇▇▇▇ Fargo Bank, N.A. as servicer (the "Servicer")
and HSBC Bank USA, National Association as trustee (the "Trustee"), a summary of
certain of the pertinent provisions of which is set forth hereafter. To the
extent not defined herein, the capitalized terms used herein have the meanings
assigned in the Agreement. This Certificate is issued under and is subject to
the terms, provisions and conditions of the Agreement, to which Agreement the
Holder of this Certificate by virtue of the acceptance hereof assents and by
which such Holder is bound.
Pursuant to the terms of the Agreement, distributions will be made on the
25th day of each month or, if such 25th day is not a Business Day, the Business
Day immediately following such 25th day (a "Distribution Date"), commencing on
the First Distribution Date specified above, to the Person in whose name this
Certificate is registered on the last Business Day of the calendar month
immediately preceding the month in which the related Distribution Date occurs
(the "Record Date"), in an amount equal to the product of the Percentage
Interest evidenced by this Certificate and the amount required to be distributed
to the Holders of Class P Certificates on such Distribution Date pursuant to the
Agreement.
All distributions to the Holder of this Certificate under the Agreement
will be made or caused to be made by the Securities Administrator by wire
transfer in immediately available funds to the account of the Person entitled
thereto if such Person shall have so notified the Securities Administrator in
writing at least five Business Days prior to the Record Date immediately prior
to such Distribution Date and is the registered owner of Class P Certificates
the aggregate initial Certificate Principal Balance of which is in excess of the
lesser of (i) $5,000,000 or (ii) two-thirds of the aggregate initial Certificate
Principal Balance of the Class P Certificates, or otherwise by check mailed by
first class mail to the address of the Person entitled thereto, as such name and
address shall appear on the Certificate Register. Notwithstanding the above, the
final distribution on this Certificate will be made after due notice by the
Securities Administrator of the pendency of such distribution and only upon
presentation and surrender of this Certificate at the office or agency appointed
by the Securities Administrator for that purpose as provided in the Agreement.
This Certificate is one of a duly authorized issue of Certificates
designated as Asset Backed Pass-Through Certificate of the Series specified on
the face hereof (herein called the "Certificates") and representing a Percentage
Interest in the Class of Certificates specified on the face hereof equal to the
denomination specified on the face hereof divided by the aggregate Certificate
Principal Balance of the Class of Certificates specified on the face hereof.
The Certificates are limited in right of payment to certain collections and
recoveries respecting the Mortgage Loans, all as more specifically set forth
herein and in the Agreement. As provided in the Agreement, withdrawals from the
Collection Account and the Distribution Account may be made from time to time
for purposes other than distributions to Certificateholders, such purposes
including reimbursement of advances made, or certain expenses incurred, with
respect to the Mortgage Loans.
The Agreement permits, with certain exceptions therein provided, the
amendment thereof and the modification of the rights and obligations of the
Depositor, the Master Servicer, the Trustee, the Securities Administrator, the
Servicer and the rights of the Certificateholders under the Agreement at any
time by the Depositor, the Master Servicer, the Trustee, the Securities
Administrator and the Servicer with the consent of the Holders of Certificates
entitled to at least 66% of the Voting Rights. Any such consent by the Holder of
this Certificate shall be conclusive and binding on such Holder and upon all
future Holders of this Certificate and of any Certificate issued upon the
transfer hereof or in exchange herefor or in lieu hereof whether or not notation
of such consent is made upon this Certificate. The Agreement also permits the
amendment thereof, in certain limited circumstances, without the consent of the
Holders of any of the Certificates.
As provided in the Agreement and subject to certain limitations therein set
forth, the transfer of this Certificate is registrable in the Certificate
Register upon surrender of this Certificate for registration of transfer at the
offices or agencies appointed by the Securities Administrator as provided in the
Agreement, duly endorsed by, or accompanied by an assignment in the form below
or other written instrument of transfer in form satisfactory to the Securities
Administrator duly executed by, the Holder hereof or such Holder's attorney duly
authorized in writing, and thereupon one or more new Certificates of the same
Class in authorized denominations evidencing the same aggregate Percentage
Interest will be issued to the designated transferee or transferees.
No transfer of this Certificate shall be made unless the transfer is made
pursuant to an effective registration statement under the Securities Act of
1933, as amended (the "1933 Act"), and an effective registration or
qualification under applicable state securities laws, or is made in a
transaction that does not require such registration or qualification. In the
event that such a transfer of this Certificate is to be made without
registration or qualification, the Securities Administrator shall require
receipt of (i) if such transfer is purportedly being made in reliance upon Rule
144A or Regulation S under the 1933 Act, written certifications from the Holder
of the Certificate desiring to effect the transfer, and from such Holder's
prospective transferee, substantially in the forms attached to the Agreement as
Exhibit B-1, (ii) if such transfer is purportedly being made in reliance upon
Rule 501(a) under the 1933 Act, written certifications from the Holder of the
Certificate desiring to effect the transfer and from such Holder's prospective
transferee, substantially in the form attached to the Agreement as Exhibit B-2
and (iii) in all other cases, an Opinion of Counsel satisfactory to it that such
transfer may be made without such registration or qualification (which Opinion
of Counsel shall not be an expense of the Trust Fund or of the Depositor, the
Trustee, the Master Servicer or the Securities Administrator in their respective
capacities as such), together with copies of the written certification(s) of the
Holder of the Certificate desiring to effect the transfer and/or such Holder's
prospective transferee upon which such Opinion of Counsel is based. None of the
Depositor, the Trustee or the Securities Administrator is obligated to register
or qualify the Class of Certificates specified on the face hereof under the 1933
Act or any other securities law or to take any action not otherwise required
under the Agreement to permit the transfer of such Certificates without
registration or qualification. Any Holder desiring to effect a transfer of this
Certificate shall be required to indemnify the Trustee, the Depositor, the
Master Servicer and the Securities Administrator against any liability that may
result if the transfer is not so exempt or is not made in accordance with such
federal and state laws.
No transfer of this Certificate to a Plan subject to ERISA or Section 4975
of the Code, any Person acting, directly or indirectly, on behalf of any such
Plan or any Person using "Plan Assets" to acquire this Certificate shall be made
except in accordance with Section 6.02(c) of the Agreement.
The Certificates are issuable in fully registered form only without coupons
in Classes and denominations representing Percentage Interests specified in the
Agreement. As provided in the Agreement and subject to certain limitations
therein set forth, the Certificates are exchangeable for new Certificates of the
same Class in authorized denominations evidencing the same aggregate Percentage
Interest, as requested by the Holder surrendering the same. No service charge
will be made for any such registration of transfer or exchange of Certificates,
but the Securities Administrator may require payment of a sum sufficient to
cover any tax or other governmental charge that may be imposed in connection
with any transfer or exchange of Certificates.
The Depositor, the Master Servicer, the Trustee, the Securities
Administrator, the Servicer and any agent of the Depositor, the Master Servicer,
the Trustee, the Securities Administrator or the Servicer may treat the Person
in whose name this Certificate is registered as the owner hereof for all
purposes, and none of the Depositor, the Master Servicer, the Trustee, the
Securities Administrator, the Servicer nor any such agent shall be affected by
notice to the contrary.
The obligations created by the Agreement and the Trust Fund created thereby
shall terminate upon payment to the Certificateholders of all amounts held by
the Securities Administrator and required to be paid to them pursuant to the
Agreement following the earlier of (i) the final payment or other liquidation
(or any advance with respect thereto) of the last Mortgage Loan remaining in
REMIC I and (ii) the purchase by the party designated in the Agreement at a
price determined as provided in the Agreement from REMIC I of all the Mortgage
Loans and all property acquired in respect of such Mortgage Loans. The Agreement
permits, but does not require, the party designated in the Agreement to purchase
from REMIC I all the Mortgage Loans and all property acquired in respect of any
Mortgage Loan at a price determined as provided in the Agreement. The exercise
of such right will effect early retirement of the Certificates; however, such
right to purchase is subject to the aggregate Scheduled Principal Balance of the
Mortgage Loans (and properties acquired in respect thereof) at the time of
purchase being less than or equal to 10% of the aggregate principal balance of
the Mortgage Loans as of the Cut-off Date.
The recitals contained herein shall be taken as statements of the Depositor
and neither the Trustee nor the Securities Administrator assume any
responsibility for their correctness.
Unless the certificate of authentication hereon has been executed by the
Securities Administrator, by manual signature, this Certificate shall not be
entitled to any benefit under the Agreement or be valid for any purpose.
IN WITNESS WHEREOF, the Securities Administrator has caused this
Certificate to be duly executed.
Dated:
▇▇▇▇▇ FARGO BANK, N.A.
as Securities Administrator
By:________________________
Authorized Officer
CERTIFICATE OF AUTHENTICATION
This is one of the Class P Certificates referred to in the
within-mentioned Agreement.
▇▇▇▇▇ FARGO BANK, N.A.
as Securities Administrator
By:________________________
Authorized Officer
ABBREVIATIONS
The following abbreviations, when used in the inscription on the face of
this instrument, shall be construed as though they were written out in full
according to applicable laws or regulations:
TEN COM - as tenants in common UNIF GIFT MIN ACT - CUSTODIAN
-------------------
(Cust) (Minor)
under Uniform Gifts
to Minors Act
TEN ENT - as tenants by the entireties -------------------
(State)
JT TEN - as joint tenants with right
if survivorship and not as
tenants in common
Additional abbreviations may also be used though not in the above list.
ASSIGNMENT
FOR VALUE RECEIVED, the undersigned hereby sell(s), assign(s) and
transfer(s) unto
----------------------------------------------------------------
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
(Please print or typewrite name, address including postal zip code, and Taxpayer
Identification Number of assignee)
(Please print or typewrite name, address including postal zip code, and Taxpayer
Identification Number of assignee)
a Percentage Interest equal to _____% evidenced by the within Asset Backed
Pass-Through Certificate and hereby authorize(s) the registration of transfer of
such interest to assignee on the Certificate Register of the Trust Fund.
I (we) further direct the Securities Administrator to issue a new
Certificate of a like Percentage Interest and Class to the above named assignee
and deliver such Certificate to the following address:
--------------------------------------------------------------------------------
----------------------------------------------------------------------------- .
Dated:
-------------------------------------
Signature by or on behalf of assignor
-------------------------------------
Signature Guaranteed
DISTRIBUTION INSTRUCTIONS
The assignee should include the following for purposes of distribution:
Distributions shall be made, by wire transfer or otherwise, in immediately
available funds to
-------------------------------------------------------------
--------------------------------------------------------------------------------
for the account of
--------------------------------------------------------------
account number or, if mailed by check, to
-----------------------------------
--------------------------------------------------------------------------------
Applicable statements should be mailed to
------------------------------
--------------------------------------------------------------------------------
This information is provided by
-------------------------------------------------
assignee named above, or
--------------------------------------------------------
its agent.
EXHIBIT A-6
FORM OF CLASS R CERTIFICATE
THIS CERTIFICATE MAY NOT BE TRANSFERRED TO A NON-UNITED STATES PERSON.
SOLELY FOR U.S. FEDERAL INCOME TAX PURPOSES, THIS CERTIFICATE
REPRESENTS THE SOLE "RESIDUAL INTEREST" IN EACH "REAL ESTATE MORTGAGE
INVESTMENT CONDUIT" ("REMIC"), AS THOSE TERMS ARE DEFINED,
RESPECTIVELY, IN SECTIONS 860G AND 860D OF THE INTERNAL REVENUE CODE OF
1986 (THE "CODE").
ANY RESALE, TRANSFER OR OTHER DISPOSITION OF THIS CERTIFICATE MAY BE
MADE ONLY IN ACCORDANCE WITH THE PROVISIONS OF SECTION 6.02 OF THE
AGREEMENT REFERRED TO HEREIN.
THIS CERTIFICATE HAS NOT BEEN AND WILL NOT BE REGISTERED UNDER THE
SECURITIES ACT OF 1933, AS AMENDED, OR THE SECURITIES LAWS OF ANY STATE
AND MAY NOT BE RESOLD OR TRANSFERRED UNLESS IT IS REGISTERED PURSUANT
TO SUCH ACT AND LAWS OR IS SOLD OR TRANSFERRED IN TRANSACTIONS THAT ARE
EXEMPT FROM REGISTRATION UNDER SUCH ACT AND UNDER APPLICABLE STATE LAW
AND IS TRANSFERRED IN ACCORDANCE WITH THE PROVISIONS OF SECTION 6.02 OF
THE AGREEMENT.
NO TRANSFER OF THIS CERTIFICATE TO AN EMPLOYEE BENEFIT PLAN OR OTHER
RETIREMENT ARRANGEMENT SUBJECT TO THE EMPLOYEE RETIREMENT INCOME
SECURITY ACT OF 1974, AS AMENDED, OR THE CODE WILL BE REGISTERED EXCEPT
IN COMPLIANCE WITH THE PROCEDURES DESCRIBED HEREIN.
ANY RESALE, TRANSFER OR OTHER DISPOSITION OF THIS CERTIFICATE MAY BE
MADE ONLY IF THE PROPOSED TRANSFEREE PROVIDES (I) AN AFFIDAVIT TO THE
SECURITIES ADMINISTRATOR THAT (A) SUCH TRANSFEREE IS NOT (1) THE UNITED
STATES OR ANY POSSESSION THEREOF, ANY STATE OR POLITICAL SUBDIVISION
THEREOF, ANY FOREIGN GOVERNMENT, ANY INTERNATIONAL ORGANIZATION, OR ANY
AGENCY OR INSTRUMENTALITY OF ANY OF THE FOREGOING, (2) ANY ORGANIZATION
(OTHER THAN A COOPERATIVE DESCRIBED IN SECTION 521 OF THE CODE) THAT IS
EXEMPT FROM THE TAX IMPOSED BY CHAPTER 1 OF THE CODE UNLESS SUCH
ORGANIZATION IS SUBJECT TO THE TAX IMPOSED BY SECTION 511 OF THE CODE,
(3) ANY ORGANIZATION DESCRIBED IN SECTION 1381(A)(2)(C) OF THE CODE
(ANY SUCH PERSON DESCRIBED IN THE FOREGOING CLAUSES (1), (2) OR (3)
SHALL HEREINAFTER BE REFERRED TO AS A "DISQUALIFIED ORGANIZATION") OR
(4) AN AGENT OF A DISQUALIFIED ORGANIZATION AND (B) NO PURPOSE OF SUCH
TRANSFER IS TO IMPEDE THE ASSESSMENT OR COLLECTION OF TAX, AND (II)
SUCH TRANSFEREE SATISFIES CERTAIN ADDITIONAL CONDITIONS RELATING TO THE
FINANCIAL CONDITION OF THE PROPOSED TRANSFEREE. NOTWITHSTANDING THE
REGISTRATION IN THE CERTIFICATE REGISTER OF ANY TRANSFER, SALE OR OTHER
DISPOSITION OF THIS CERTIFICATE TO A DISQUALIFIED ORGANIZATION OR AN
AGENT OF A DISQUALIFIED ORGANIZATION, SUCH REGISTRATION SHALL BE DEEMED
TO BE OF NO LEGAL FORCE OR EFFECT WHATSOEVER AND SUCH PERSON SHALL NOT
BE DEEMED TO BE A CERTIFICATEHOLDER FOR ANY PURPOSE HEREUNDER,
INCLUDING, BUT NOT LIMITED TO, THE RECEIPT OF DISTRIBUTIONS ON THIS
CERTIFICATE. EACH HOLDER OF THIS CERTIFICATE BY ACCEPTANCE HEREOF SHALL
BE DEEMED TO HAVE CONSENTED TO THE PROVISIONS OF THIS PARAGRAPH AND THE
PROVISIONS OF SECTION 6.02(D) OF THE AGREEMENT REFERRED TO HEREIN. ANY
PERSON THAT IS A DISQUALIFIED ORGANIZATION IS PROHIBITED FROM ACQUIRING
BENEFICIAL OWNERSHIP OF THIS CERTIFICATE.
ANY PERSON ACQUIRING A CERTIFICATE DIRECTLY OR INDIRECTLY BY, ON BEHALF
OF, OR WITH PLAN ASSETS OF AN EMPLOYEE BENEFIT PLAN OR OTHER RETIREMENT
ARRANGEMENT THAT IS SUBJECT TO TITLE I OF THE EMPLOYEE RETIREMENT
INCOME SECURITY ACT OF 1974, AS AMENDED, OR SECTION 4975 OF THE
INTERNAL REVENUE CODE OF 1986, SHALL BE DEEMED TO HAVE MADE THE
REPRESENTATIONS OR PROVIDED THE OPINION OF COUNSEL IN SECTION 6.02(C)
OF THE POOLING AND SERVICING AGREEMENT.
Series 2005-HE7, Class R Aggregate Percentage Interest of the
Class R Certificates as of the
Issue Date: 100.00%
Date of Pooling and Servicing Agreement Master Servicer:
and Cut-off Date: November 1, 2005 ▇▇▇▇▇ Fargo Bank, N.A.
First Distribution Date: Trustee: HSBC Bank USA,
November 25, 2005 National Association
No __ Issue Date: November 28, 2005
ACE SECURITIES CORP. HOME EQUITY LOAN TRUST, SERIES 2005-HE7
ASSET BACKED PASS-THROUGH CERTIFICATE
evidencing a beneficial ownership interest in a Trust Fund (the "Trust Fund")
consisting primarily of a pool of conventional one- to four-family, fixed and
adjustable-rate first lien mortgage loans (the "Mortgage Loans") formed and sold
by
ACE SECURITIES CORP.
THIS CERTIFICATE DOES NOT REPRESENT AN OBLIGATION OF OR
INTEREST IN ACE SECURITIES CORP., THE MASTER SERVICER, THE
SECURITIES ADMINISTRATOR, THE SERVICER, THE TRUSTEE OR ANY
OF THEIR RESPECTIVE AFFILIATES. NEITHER THIS CERTIFICATE NOR
THE UNDERLYING MORTGAGE LOANS ARE GUARANTEED BY ANY AGENCY
OR INSTRUMENTALITY OF THE UNITED STATES.
This certifies that _______________ is the registered owner of
a Percentage Interest (obtained by dividing the denomination of this Certificate
by the aggregate Certificate Principal Balance of the Class R Certificates as of
the Issue Date) in that certain beneficial ownership interest evidenced by all
the Class R Certificates in REMIC III created pursuant to a Pooling and
Servicing Agreement, dated as specified above (the "Agreement"), among ACE
Securities Corp., as depositor (hereinafter called the "Depositor", which term
includes any successor entity under the Agreement), ▇▇▇▇▇ Fargo Bank, N.A. as
master servicer (the "Master Servicer") and securities administrator (the
"Securities Administrator"), ▇▇▇▇▇ Fargo Bank, N.A. as servicer (the "Servicer")
and HSBC Bank USA, National Association as trustee (the "Trustee"), a summary of
certain of the pertinent provisions of which is set forth hereafter. To the
extent not defined herein, the capitalized terms used herein have the meanings
assigned in the Agreement. This Certificate is issued under and is subject to
the terms, provisions and conditions of the Agreement, to which Agreement the
Holder of this Certificate by virtue of the acceptance hereof assents and by
which such Holder is bound.
Pursuant to the terms of the Agreement, distributions will be
made on the 25th day of each month or, if such 25th day is not a Business Day,
the Business Day immediately following (a "Distribution Date"), commencing on
the First Distribution Date specified above, to the Person in whose name this
Certificate is registered on the Record Date, in an amount equal to the product
of the Percentage Interest evidenced by this Certificate and the amount required
to be distributed to the Holders of Class R Certificates on such Distribution
Date pursuant to the Agreement.
All distributions to the Holder of this Certificate under the
Agreement will be made or caused to be made by the Securities Administrator by
wire transfer in immediately available funds to the account of the Person
entitled thereto if such Person shall have so notified the Securities
Administrator in writing at least five Business Days prior to the Record Date
immediately prior to such Distribution Date and is the registered owner of Class
R Certificates, or otherwise by check mailed by first class mail to the address
of the Person entitled thereto, as such name and address shall appear on the
Certificate Register. Notwithstanding the above, the final distribution on this
Certificate will be made after due notice by the Securities Administrator of the
pendency of such distribution and only upon presentation and surrender of this
Certificate at the office or agency appointed by the Securities Administrator
for that purpose as provided in the Agreement.
This Certificate is one of a duly authorized issue of
Certificates designated as Asset Backed Pass-Through Certificate of the Series
specified on the face hereof (herein called the "Certificates") and representing
a Percentage Interest in the Class of Certificates specified on the face hereof
equal to the denomination specified on the face hereof divided by the aggregate
Certificate Principal Balance of the Class of Certificates specified on the face
hereof.
The Certificates are limited in right of payment to certain
collections and recoveries respecting the Mortgage Loans, all as more
specifically set forth herein and in the Agreement. As provided in the
Agreement, withdrawals from the Collection Account and the Distribution Account
may be made from time to time for purposes other than distributions to
Certificateholders, such purposes including reimbursement of advances made, or
certain expenses incurred, with respect to the Mortgage Loans.
The Agreement permits, with certain exceptions therein
provided, the amendment thereof and the modification of the rights and
obligations of the Depositor, the Master Servicer, the Trustee, the Securities
Administrator, the Servicer and the rights of the Certificateholders under the
Agreement at any time by the Depositor, the Master Servicer, the Trustee, the
Securities Administrator and the Servicer with the consent of the Holders of
Certificates entitled to at least 66% of the Voting Rights. Any such consent by
the Holder of this Certificate shall be conclusive and binding on such Holder
and upon all future Holders of this Certificate and of any Certificate issued
upon the transfer hereof or in exchange herefor or in lieu hereof whether or not
notation of such consent is made upon this Certificate. The Agreement also
permits the amendment thereof, in certain limited circumstances, without the
consent of the Holders of any of the Certificates.
As provided in the Agreement and subject to certain
limitations therein set forth, the transfer of this Certificate is registrable
in the Certificate Register upon surrender of this Certificate for registration
of transfer at the offices or agencies appointed by the Securities Administrator
as provided in the Agreement, duly endorsed by, or accompanied by an assignment
in the form below or other written instrument of transfer in form satisfactory
to the Securities Administrator duly executed by, the Holder hereof or such
Holder's attorney duly authorized in writing, and thereupon one or more new
Certificates of the same Class in authorized denominations evidencing the same
aggregate Percentage Interest will be issued to the designated transferee or
transferees.
The Certificates are issuable in fully registered form only
without coupons in Classes and denominations representing Percentage Interests
specified in the Agreement. As provided in the Agreement and subject to certain
limitations therein set forth, Certificates are exchangeable for new
Certificates of the same Class in authorized denominations evidencing the same
aggregate Percentage Interest, as requested by the Holder surrendering the same.
No transfer of this Certificate shall be made unless the
transfer is made pursuant to an effective registration statement under the
Securities Act of 1933, as amended (the "1933 Act"), and an effective
registration or qualification under applicable state securities laws, or is made
in a transaction that does not require such registration or qualification. In
the event that such a transfer of this Certificate is to be made without
registration or qualification, the Securities Administrator shall require
receipt of (i) if such transfer is purportedly being made in reliance upon Rule
144A under the 1933 Act, written certifications from the Holder of the
Certificate desiring to effect the transfer, and from such Holder's prospective
transferee, substantially in the forms attached to the Agreement as Exhibit B-1,
and (ii) in all other cases, an Opinion of Counsel satisfactory to it that such
transfer may be made without such registration or qualification (which Opinion
of Counsel shall not be an expense of the Trust Fund or of the Depositor, the
Trustee, the Master Servicer or the Securities Administrator in their respective
capacities as such), together with copies of the written certification(s) of the
Holder of the Certificate desiring to effect the transfer and/or such Holder's
prospective transferee upon which such Opinion of Counsel is based. None of the
Depositor, the Trustee or the Securities Administrator is obligated to register
or qualify the Class of Certificates specified on the face hereof under the 1933
Act or any other securities law or to take any action not otherwise required
under the Agreement to permit the transfer of such Certificates without
registration or qualification. Any Holder desiring to effect a transfer of this
Certificate shall be required to indemnify the Trustee, the Depositor, the
Master Servicer and the Securities Administrator against any liability that may
result if the transfer is not so exempt or is not made in accordance with such
federal and state laws.
No transfer of this Certificate to a Plan subject to ERISA or
Section 4975 of the Code, any Person acting, directly or indirectly, on behalf
of any such Plan or any Person using "Plan Assets" to acquire this Certificate
shall be made except in accordance with Section 6.02 of the Agreement.
Prior to registration of any transfer, sale or other
disposition of this Certificate, the proposed transferee shall provide to the
Securities Administrator (i) an affidavit to the effect that such transferee is
any Person other than a Disqualified Organization or the agent (including a
broker, nominee or middleman) of a Disqualified Organization, and (ii) a
certificate that acknowledges that (A) the Class R Certificates have been
designated as representing the beneficial ownership of the residual interests in
each of REMIC I and REMIC II, (B) it will include in its income a PRO RATA share
of the net income of the Trust Fund and that such income may be an "excess
inclusion," as defined in the Code, that, with certain exceptions, cannot be
offset by other losses or benefits from any tax exemption, and (C) it expects to
have the financial means to satisfy all of its tax obligations including those
relating to holding the Class R Certificates. Notwithstanding the registration
in the Certificate Register of any transfer, sale or other disposition of this
Certificate to a Disqualified Organization or an agent (including a broker,
nominee or middleman) of a Disqualified Organization, such registration shall be
deemed to be of no legal force or effect whatsoever and such Person shall not be
deemed to be a Certificateholder for any purpose, including, but not limited to,
the receipt of distributions in respect of this Certificate.
The Holder of this Certificate, by its acceptance hereof,
shall be deemed to have consented to the provisions of Section 6.02 of the
Agreement and to any amendment of the Agreement deemed necessary by counsel of
the Depositor to ensure that the transfer of this Certificate to any Person
other than a Permitted Transferee or any other Person will not cause any portion
of the Trust Fund to cease to qualify as a REMIC or cause the imposition of a
tax upon any REMIC.
No service charge will be made for any such registration of
transfer or exchange of Certificates, but the Securities Administrator may
require payment of a sum sufficient to cover any tax or other governmental
charge that may be imposed in connection with any transfer or exchange of
Certificates.
The Depositor, the Master Servicer, the Trustee, the
Securities Administrator, the Servicer and any agent of the Depositor, the
Master Servicer, the Trustee, the Securities Administrator or the Servicer may
treat the Person in whose name this Certificate is registered as the owner
hereof for all purposes, and none of the Depositor, the Master Servicer, the
Trustee, the Securities Administrator, the Servicer nor any such agent shall be
affected by notice to the contrary.
The obligations created by the Agreement and the Trust Fund
created thereby shall terminate upon payment to the Certificateholders of all
amounts held by the Securities Administrator and required to be paid to them
pursuant to the Agreement following the earlier of (i) the final payment or
other liquidation (or any advance with respect thereto) of the last Mortgage
Loan remaining in REMIC I and (ii) the purchase by the party designated in the
Agreement at a price determined as provided in the Agreement from REMIC I of all
the Mortgage Loans and all property acquired in respect of such Mortgage Loans.
The Agreement permits, but does not require, the party designated in the
Agreement to purchase from REMIC I all the Mortgage Loans and all property
acquired in respect of any Mortgage Loan at a price determined as provided in
the Agreement. The exercise of such right will effect early retirement of the
Certificates; however, such right to purchase is subject to the aggregate
Scheduled Principal Balance of the Mortgage Loans (and properties acquired in
respect thereof) at the time of purchase being less than or equal to 10% of the
aggregate principal balance of the Mortgage Loans as of the Cut-off Date.
The recitals contained herein shall be taken as statements of
the Depositor and neither the Trustee nor the Securities Administrator assume
any responsibility for their correctness.
Unless the certificate of authentication hereon has been
executed by the Securities Administrator, by manual signature, this Certificate
shall not be entitled to any benefit under the Agreement or be valid for any
purpose.
IN WITNESS WHEREOF, the Securities Administrator has caused this
Certificate to be duly executed.
Dated:
▇▇▇▇▇ FARGO BANK, N.A.
as Securities Administrator
By:________________________
Authorized Officer
CERTIFICATE OF AUTHENTICATION
This is one of the Class R Certificates referred to in the
within-mentioned Agreement.
▇▇▇▇▇ FARGO BANK, N.A.
as Securities Administrator
By:________________________
Authorized Signatory
ABBREVIATIONS
The following abbreviations, when used in the inscription on the face of
this instrument, shall be construed as though they were written out in full
according to applicable laws or regulations:
TEN COM - as tenants in common UNIF GIFT MIN ACT - CUSTODIAN
-------------------
(Cust) (Minor)
under Uniform Gifts
to Minors Act
TEN ENT - as tenants by the entireties -------------------
(State)
JT TEN - as joint tenants with right
if survivorship and not as
tenants in common
Additional abbreviations may also be used though not in the above list.
ASSIGNMENT
FOR VALUE RECEIVED, the undersigned hereby sell(s), assign(s) and
transfer(s) unto
----------------------------------------------------------------
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
(Please print or typewrite name, address including postal zip code, and Taxpayer
Identification Number of assignee)
(Please print or typewrite name, address including postal zip code, and Taxpayer
Identification Number of assignee)
a Percentage Interest equal to _____% evidenced by the within Asset Backed
Pass-Through Certificate and hereby authorize(s) the registration of transfer of
such interest to assignee on the Certificate Register of the Trust Fund.
I (we) further direct the Securities Administrator to issue a new
Certificate of a like Percentage Interest and Class to the above named assignee
and deliver such Certificate to the following address:
--------------------------------------------------------------------------------
----------------------------------------------------------------------------- .
Dated:
-------------------------------------
Signature by or on behalf of assignor
-------------------------------------
Signature Guaranteed
DISTRIBUTION INSTRUCTIONS
The assignee should include the following for purposes of distribution:
Distributions shall be made, by wire transfer or otherwise, in immediately
available funds to
-------------------------------------------------------------
--------------------------------------------------------------------------------
for the account of
--------------------------------------------------------------
account number or, if mailed by check, to
-----------------------------------
--------------------------------------------------------------------------------
Applicable statements should be mailed to
------------------------------
--------------------------------------------------------------------------------
This information is provided by
-------------------------------------------------
assignee named above, or
--------------------------------------------------------
its agent.
EXHIBIT B-1
FORM OF TRANSFEROR REPRESENTATION LETTER
[Date]
▇▇▇▇▇ Fargo Bank, N.A.
▇▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇ ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Attention: Corporate Trust ACE 2005-HE7
Re: ACE Securities Corp. Home Equity Loan Trust, Series 2005-HE7
Asset Backed Pass-Through Certificates Class CE, Class P and
Class R Certificates
-----------------------------------------------------------------
Ladies and Gentlemen:
In connection with the transfer by ______________________ (the
"Transferor") to ___________________ (the "Transferee") of the captioned
mortgage pass-through certificates (the "Certificates"), the Transferor hereby
certifies as follows:
Neither the Transferor nor anyone acting on its behalf has (a)
offered, pledged, sold, disposed of or otherwise transferred any Certificate,
any interest in any Certificate or any other similar security to any person in
any manner, (b) has solicited any offer to buy or to accept a pledge,
disposition or other transfer of any Certificate, any interest in any
Certificate or any other similar security from any person in any manner, (c) has
otherwise approached or negotiated with respect to any Certificate, any interest
in any Certificate or any other similar security with any person in any manner,
(d) has made any general solicitation by means of general advertising or in any
other manner, (e) has taken any other action, that (in the case of each of
subclauses (a) through (e) above) would constitute a distribution of the
Certificates under the Securities Act of 1933, as amended (the "1933 Act"), or
would render the disposition of any Certificate a violation of Section 5 of the
1933 Act or any state securities law or would require registration or
qualification pursuant thereto. The Transferor will not act, nor has it
authorized or will it authorize any person to act, in any manner set forth in
the foregoing sentence with respect to any Certificate. The Transferor will not
sell or otherwise transfer any of the Certificates, except in compliance with
the provisions of that certain Pooling and Servicing Agreement, dated as of
November 1, 2005, among ACE Securities Corp. as Depositor, ▇▇▇▇▇ Fargo Bank,
N.A. as Master Servicer and Securities Administrator, ▇▇▇▇▇ Fargo Bank, N.A. as
Servicer, and HSBC Bank USA, National Association as trustee (the "Pooling and
Servicing Agreement"), pursuant to which Pooling and Servicing Agreement the
Certificates were issued.
Capitalized terms used but not defined herein shall have the
meanings assigned thereto in the Pooling and Servicing Agreement.
Very truly yours,
[Transferor]
By:________________________
Name:
Title:
FORM OF TRANSFEREE REPRESENTATION LETTER
[Date]
▇▇▇▇▇ Fargo Bank, N.A.
▇▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇ ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Attention: Corporate Trust ACE 2005-HE7
Re: ACE Securities Corp. Home Equity Loan Trust, Series 2005-HE7
Asset Backed Pass-Through Certificates Class CE, Class P and
Class R Certificates
-----------------------------------------------------------------
Ladies and Gentlemen:
In connection with the purchase from
______________________________ (the "Transferor") on the date hereof of the
captioned trust certificates (the "Certificates"), (the "Transferee") hereby
certifies as follows:
1. The Transferee is a "qualified institutional
buyer" as that term is defined in Rule 144A ("Rule 144A")
under the Securities Act of 1933 (the "1933 Act") and has
completed either of the forms of certification to that effect
attached hereto as Annex 1 or Annex 2. The Transferee is aware
that the sale to it is being made in reliance on Rule 144A.
The Transferee is acquiring the Certificates for its own
account or for the account of a qualified institutional buyer,
and understands that such Certificate may be resold, pledged
or transferred only (i) to a person reasonably believed to be
a qualified institutional buyer that purchases for its own
account or for the account of a qualified institutional buyer
to whom notice is given that the resale, pledge or transfer is
being made in reliance on Rule 144A, or (ii) pursuant to
another exemption from registration under the 1933 Act.
2. The Transferee has been furnished with all
information regarding (a) the Certificates and distributions
thereon, (b) the nature, performance and servicing of the
Mortgage Loans, (c) the Pooling and Servicing Agreement
referred to below, and (d) any credit enhancement mechanism
associated with the Certificates, that it has requested.
3. The Transferee: (a) is not an employee benefit
plan or other plan subject to the prohibited transaction
provisions 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") (each, a
"Plan"), or any other person (including an investment manager,
a named fiduciary or a trustee of any Plan) acting, directly
or indirectly, on behalf of or purchasing any Certificate with
"plan assets" of any Plan within the meaning of the Department
of Labor ("DOL") regulation at 29 C.F.R. ss. 2510.3-101 or (b)
has provided the Securities Administrator with an opinion of
counsel on which the Trustee, the Depositor, the Master
Servicer, the Securities Administrator and the Servicer may
rely, acceptable to and in form and substance satisfactory to
the Trustee to the effect that the purchase of Certificates is
permissible under applicable law, will not constitute or
result in any non-exempt prohibited transaction under ERISA or
Section 4975 of the Code and will not subject the Trust Fund,
the Trustee, the Depositor, the Master Servicer, the
Securities Administrator or the Servicer to any obligation or
liability (including obligations or liabilities under ERISA or
Section 4975 of the Code) in addition to those undertaken in
the Pooling and Servicing Agreement.
In addition, the Transferee hereby certifies, represents and
warrants to, and covenants with, the Depositor, the Trustee, the Securities
Administrator, the Master Servicer and the Servicer that the Transferee will not
transfer such Certificates to any Plan or person unless such Plan or person
meets the requirements set forth in paragraph 3 above.
All capitalized terms used but not otherwise defined herein
have the respective meanings assigned thereto in the Pooling and Servicing
Agreement, dated as of November 1, 2005, among ACE Securities Corp. as
Depositor, ▇▇▇▇▇ Fargo Bank, N.A. as Master Servicer and Securities
Administrator, ▇▇▇▇▇ Fargo Bank, N.A. as Servicer and HSBC Bank USA, National
Association as Trustee, pursuant to which the Certificates were issued.
[TRANSFEREE]
By:________________________
Name:
Title:
ANNEX 1 TO EXHIBIT B-1
QUALIFIED INSTITUTIONAL BUYER STATUS UNDER SEC RULE 144A
[For Transferees Other Than Registered Investment Companies]
The undersigned hereby certifies as follows to [name of
Transferor] (the "Transferor") and ▇▇▇▇▇ Fargo Bank, N.A., as Securities
Administrator, with respect to the asset backed pass-through certificates (the
"Certificates") described in the Transferee Certificate to which this
certification relates and to which this certification is an Annex:
1. As indicated below, the undersigned is the President, Chief
Financial Officer, Senior Vice President or other executive officer of the
entity purchasing the Certificates (the "Transferee").
2. In connection with purchases by the Transferee, the
Transferee is a "qualified institutional buyer" as that term is defined in Rule
144A under the Securities Act of 1933 ("Rule 144A") because (i) the Transferee
owned and/or invested on a discretionary basis $________________(1) in
securities (except for the excluded securities referred to below) as of the end
of the Transferee's most recent fiscal year (such amount being calculated in
accordance with Rule 144A) and (ii) the Transferee satisfies the criteria in the
category marked below.
___ CORPORATION, ETC. The Transferee is a corporation (other than
a bank, savings and loan association or similar institution),
Massachusetts or similar business trust, partnership, or any
organization described in Section 501(c)(3) of the Internal
Revenue Code of 1986.
___ BANK. The Transferee (a) is a national bank or banking
institution organized under the laws of any State, territory
or the District of Columbia, the business of which is
substantially confined to banking and is supervised by the
State or territorial banking commission or similar official
or is a foreign bank or equivalent institution, and (b) has
an audited net worth of at least $25,000,000 as demonstrated
in its latest annual financial statements, A COPY OF WHICH IS
ATTACHED HERETO.
___ SAVINGS AND LOAN. The Transferee (a) is a savings and loan
association, building and loan association, cooperative bank,
homestead association or similar institution, which is
supervised and examined by a State or Federal authority
having supervision over any such institutions or is a foreign
savings and loan association or equivalent institution and
(b) has an audited net worth of at least $25,000,000 as
demonstrated in its latest annual financial statements, A
COPY OF WHICH IS ATTACHED HERETO.
___ BROKER-DEALER. The Transferee is a dealer registered
pursuant to Section 15 of the Securities Exchange Act of
1934.
___ INSURANCE COMPANY. The Transferee is an insurance company
whose primary and predominant business activity is the
writing of insurance or the reinsuring of risks underwritten
by insurance companies and which is subject to supervision by
the insurance commissioner or a similar official or agency of
a State, territory or the District of Columbia.
___ STATE OR LOCAL PLAN. The Transferee is a plan established and
maintained by a State, its political subdivisions, or any
agency or instrumentality of the State or its political
subdivisions, for the benefit of its employees.
___ ERISA PLAN. The Transferee is an employee benefit plan within
the meaning of Title I of the Employee Retirement Income
Security Act of 1974.
___ INVESTMENT ADVISOR The Transferee is an investment advisor
registered under the Investment Advisers Act of 1940.
-------------------
(1) Transferee must own and/or invest on a discretionary basis at least
$100,000,000 in securities unless Transferee is a dealer, and, in that
case, Transferee must own and/or invest on a discretionary basis at least
$10,000,000 in securities.
3. The term "SECURITIES" as used herein DOES NOT INCLUDE (i)
securities of issuers that are affiliated with the Transferee, (ii) securities
that are part of an unsold allotment to or subscription by the Transferee, if
the Transferee is a dealer, (iii) securities issued or guaranteed by the U.S. or
any instrumentality thereof, (iv) bank deposit notes and certificates of
deposit, (v) loan participations, (vi) repurchase agreements, (vii) securities
owned but subject to a repurchase agreement and (viii) currency, interest rate
and commodity swaps.
4. For purposes of determining the aggregate amount of
securities owned and/or invested on a discretionary basis by the Transferee, the
Transferee used the cost of such securities to the Transferee and did not
include any of the securities referred to in the preceding paragraph. Further,
in determining such aggregate amount, the Transferee may have included
securities owned by subsidiaries of the Transferee, but only if such
subsidiaries are consolidated with the Transferee in its financial statements
prepared in accordance with generally accepted accounting principles and if the
investments of such subsidiaries are managed under the Transferee's direction.
However, such securities were not included if the Transferee is a
majority-owned, consolidated subsidiary of another enterprise and the Transferee
is not itself a reporting company under the Securities Exchange Act of 1934.
5. The Transferee acknowledges that it is familiar with Rule
144A and understands that the Transferor and other parties related to the
Certificates are relying and will continue to rely on the statements made herein
because one or more sales to the Transferee may be in reliance on Rule 144A.
___ ___ Will the Transferee be purchasing the Certificates
Yes No only for the Transferee's own account?
6. If the answer to the foregoing question is "no", the
Transferee agrees that, in connection with any purchase of securities sold to
the Transferee for the account of a third party (including any separate account)
in reliance on Rule 144A, the Transferee will only purchase for the account of a
third party that at the time is a "qualified institutional buyer" within the
meaning of Rule 144A. In addition, the Transferee agrees that the Transferee
will not purchase securities for a third party unless the Transferee has
obtained a current representation letter from such third party or taken other
appropriate steps contemplated by Rule 144A to conclude that such third party
independently meets the definition of "qualified institutional buyer" set forth
in Rule 144A.
7. The Transferee will notify each of the parties to which
this certification is made of any changes in the information and conclusions
herein. Until such notice is given, the Transferee's purchase of the
Certificates will constitute a reaffirmation of this certification as of the
date of such purchase. In addition, if the Transferee is a bank or savings and
loan as provided above, the Transferee agrees that it will furnish to such
parties updated annual financial statements promptly after they become
available.
Dated:
---------------------------
Print Name of Transferee
By:________________________
Name:
Title:
ANNEX 2 TO EXHIBIT B-1
QUALIFIED INSTITUTIONAL BUYER STATUS UNDER SEC RULE 144A
[For Transferees That Are Registered Investment Companies]
The undersigned hereby certifies as follows to [name of
Transferor] (the "Transferor") and ▇▇▇▇▇ Fargo Bank, N.A., as Securities
Administrator, with respect to the asset backed pass-through certificates (the
"Certificates") described in the Transferee Certificate to which this
certification relates and to which this certification is an Annex:
1. As indicated below, the undersigned is the President, Chief
Financial Officer or Senior Vice President of the entity purchasing the
Certificates (the "Transferee") or, if the Transferee is a "qualified
institutional buyer" as that term is defined in Rule 144A under the Securities
Act of 1933 ("Rule 144A") because the Transferee is part of a Family of
Investment Companies (as defined below), is such an officer of the investment
adviser (the "Adviser").
2. In connection with purchases by the Transferee, the
Transferee is a "qualified institutional buyer" as defined in Rule 144A because
(i) the Transferee is an investment company registered under the Investment
Company Act of 1940, and (ii) as marked below, the Transferee alone, or the
Transferee's Family of Investment Companies, owned at least $100,000,000 in
securities (other than the excluded securities referred to below) as of the end
of the Transferee's most recent fiscal year. For purposes of determining the
amount of securities owned by the Transferee or the Transferee's Family of
Investment Companies, the cost of such securities was used.
___ The Transferee owned $________________________ in securities
(other than the excluded securities referred to below) as of
the end of the Transferee's most recent fiscal year (such
amount being calculated in accordance with Rule 144A).
___ The Transferee is part of a Family of Investment Companies
which owned in the aggregate $_______________ in securities
(other than the excluded securities referred to below) as of
the end of the Transferee's most recent fiscal year (such
amount being calculated in accordance with Rule 144A).
3. The term "FAMILY OF INVESTMENT COMPANIES" as used herein
means two or more registered investment companies (or series thereof) that have
the same investment adviser or investment advisers that are affiliated (by
virtue of being majority owned subsidiaries of the same parent or because one
investment adviser is a majority owned subsidiary of the other).
4. The term "SECURITIES" as used herein does not include (i)
securities of issuers that are affiliated with the Transferee or are part of the
Transferee's Family of Investment Companies, (ii) securities issued or
guaranteed by the U.S. or any instrumentality thereof, (iii) bank deposit notes
and certificates of deposit, (iv) loan participations, (v) repurchase
agreements, (vi) securities owned but subject to a repurchase agreement and
(vii) currency, interest rate and commodity swaps.
5. The Transferee is familiar with Rule 144A and understands
that the parties to which this certification is being made are relying and will
continue to rely on the statements made herein because one or more sales to the
Transferee will be in reliance on Rule 144A. In addition, the Transferee will
only purchase for the Transferee's own account.
6. The undersigned will notify the parties to which this
certification is made of any changes in the information and conclusions herein.
Until such notice, the Transferee's purchase of the Certificates will constitute
a reaffirmation of this certification by the undersigned as of the date of such
purchase.
Dated:
-----------------------------------
Print Name of Transferee or Advisor
By:________________________________
Name:
Title:
IF AN ADVISER:
-----------------------------------
Print Name of Transferee
FORM OF TRANSFEREE REPRESENTATION LETTER
The undersigned hereby certifies on behalf of the purchaser
named below (the "Purchaser") as follows:
1. I am an executive officer of the Purchaser.
2. The Purchaser is a "qualified institutional buyer", as
defined in Rule 144A, ("Rule 144A") under the Securities Act of 1933,
as amended.
3. As of the date specified below (which is not earlier than
the last day of the Purchaser's most recent fiscal year), the amount of
"securities", computed for purposes of Rule 144A, owned and invested on
a discretionary basis by the Purchaser was in excess of $100,000,000.
Name of Purchaser
---------------------------------------------------
By: (Signature)
---------------------------------------------------
Name of Signatory
---------------------------------------------------
Title
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Date of this certificate
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Date of information provided in paragraph 3
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ANNEX A TO EXHIBIT B-1
FORM OF REGULATION S TRANSFER CERTIFICATE
[Date]
▇▇▇▇▇ Fargo Bank, N.A.
▇▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇ ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Attention: Corporate Trust ACE 2005-HE7
Re: ACE Securities Corp. Home Equity Loan Trust, Series 2005-HE7
Asset Backed Pass-Through Certificates, Class CE
Certificates and/or Class P Certificates
------------------------------------------------------------
Ladies and Gentlemen:
Reference is hereby made to the Pooling and Servicing
Agreement (the "Agreement"), dated as of November 1, 2005, among ACE Securities
Corp. (the "Depositor"), ▇▇▇▇▇ Fargo Bank, N.A., as master servicer and
securities administrator (the "Master Servicer"), ▇▇▇▇▇ Fargo Bank, N.A. as
servicer (the "Servicer") and HSBC Bank USA, National Association, as trustee
(the "Trustee"). Capitalized terms used herein but not defined herein shall have
the meanings assigned thereto in the Agreement.
This letter relates to U.S. $[__________] Certificate
Principal Balance of Class [CE][P] Certificates (the "Certificates") which are
held in the name of [name of transferor] (the "Transferor") to effect the
transfer of the Certificates to a person who wishes to take delivery thereof in
the form of an equivalent beneficial interest [name of transferee] (the
"Transferee").
In connection with such request, the Transferor hereby
certifies that such transfer has been effected in accordance with the transfer
restrictions set forth in the Agreement relating to the Certificates and that
the following additional requirements (if applicable) were satisfied:
(a) the offer of the Certificates was not made to a person in
the United States;
(b) at the time the buy order was originated, the Transferee
was outside the United States or the Transferor and any person acting on its
behalf reasonably believed that the Transferee was outside the United States;
(c) no directed selling efforts were made in contravention of
the requirements of Rule 903(b) or 904(b) of Regulation S, as applicable;
(d) the transfer or exchange is not part of a plan or
scheme to evade the registration requirements of the Securities Act;
(e) the Transferee is not a U.S. Person, as defined in
Regulation S under the Securities Act;
(f) the transfer was made in accordance with the applicable
provisions of Rule 903(b)(2) or (3) or Rule 904(b)(1), as the case may be; and
(g) the Transferee understands that the Certificates have not
been and will not be registered under the Securities Act, that any offers, sales
or deliveries of the Certificates purchased by the Transferee in the United
States or to U.S. persons prior to the date that is 40 days after the later of
(i) the commencement of the offering of the Certificates and (ii) the Closing
Date, may constitute a violation of United States law, and that (x)
distributions of principal and interest and (y) the exchange of beneficial
interests in a Temporary Regulation S Global Certificate for beneficial
interests in the related Permanent Regulation S Global Certificate, in each
case, will be made in respect of such Certificates only following the delivery
by the Holder of a certification of non-U.S. beneficial ownership, at the times
and in the manner set forth in the Agreement.
You 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 proceedings or official inquiry with respect to the
matters covered hereby.
[Name of Transferor]
By:_______________________
Name:
Title:
EXHIBIT B-2
FORM OF TRANSFEROR REPRESENTATION LETTER
____________, 20__
▇▇▇▇▇ Fargo Bank, N.A.
▇▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇ ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Attention: Corporate Trust ACE 2005-HE7
Re: ACE Securities Corp. Home Equity Loan Trust, Series 2005-HE7
Asset Backed Pass-Through Certificates,
Class CE, Class P and Class R Certificates
------------------------------------------------------------
Ladies and Gentlemen:
In connection with the transfer by ________________ (the
"Transferor") to __________________________ (the "Transferee") of the captioned
mortgage pass-through certificates (the "Certificates"), the Transferor hereby
certifies as follows:
Neither the Seller nor anyone acting on its behalf has (a)
offered, pledged, sold, disposed of or otherwise transferred any Certificate,
any interest in any Certificate or any other similar security to any person in
any manner, (b) has solicited any offer to buy or to accept a pledge,
disposition or other transfer of any Certificate, any interest in any
Certificate or any other similar security from any person in any manner, (c) has
otherwise approached or negotiated with respect to any Certificate, any interest
in any Certificate or any other similar security with any person in any manner,
(d) has made any general solicitation by means of general advertising or in any
other manner, or (e) has taken any other action, that (as to any of (a) through
(e) above) would constitute a distribution of the Certificates under the
Securities Act of 1933 (the "Act'), that would render the disposition of any
Certificate a violation of Section 5 of the Act or any state securities law, or
that would require registration or qualification pursuant thereto. The Seller
will not act, in any manner set forth in the foregoing sentence with respect to
any Certificate. The Seller has not and will not sell or otherwise transfer any
of the Certificates, except in compliance with the provisions of the Pooling and
Servicing Agreement.
Very truly yours,
--------------------------
(Transferor)
By:_______________________
Name:
Title:
FORM OF TRANSFEREE LETTER
_______________, 20__
▇▇▇▇▇ Fargo Bank, N.A.
▇▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇ ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Attention: Corporate Trust ACE 2005-HE7
Re: ACE Securities Corp. Home Equity Loan Trust, Series 2005-HE7
Asset Backed Pass-Through Certificates,
Class CE, Class P and Class R Certificates
------------------------------------------------------------
Ladies and Gentlemen:
In connection with the transfer by ______________________ (the
"Transferor") to __________________________ (the "Transferee") of the captioned
mortgage pass-through certificates (the "Certificates"), the Transferee hereby
certifies as follows:
1. The Transferee understands that (a) the Certificates have
not been and will not be registered or qualified under the Securities
Act of 1933, as amended (the "Act") or any state securities law, (b)
the Depositor is not required to so register or qualify the
Certificates, (c) the Certificates may be resold only if registered and
qualified pursuant to the provisions of the Act or any state securities
law, or if an exemption from such registration and qualification is
available, (d) the Pooling and Servicing Agreement contains
restrictions regarding the transfer of the Certificates and (e) the
Certificates will bear a legend to the foregoing effect.
2. The Transferee is acquiring the Certificates for its own
account for investment only and not with a view to or for sale in
connection with any distribution thereof in any manner that would
violate the Act or any applicable state securities laws.
3. The Transferee is (a) a substantial, sophisticated
institutional investor having such knowledge and experience in
financial and business matters, and, in particular, in such matters
related to securities similar to the Certificates, such that it is
capable of evaluating the merits and risks of investment in the
Certificates, (b) able to bear the economic risks of such an investment
and (c) an "accredited investor" within the meaning of Rule 501(a)
promulgated pursuant to the Act.
4. The Transferee has been furnished with, and has had an
opportunity to review (a) a copy of the Pooling and Servicing Agreement
and (b) such other information concerning the Certificates, the
Mortgage Loans and the Depositor as has been requested by the
Transferee from the Depositor or the Transferor and is relevant to the
Transferee's decision to purchase the Certificates. The Transferee has
had any questions arising from such review answered by the Depositor or
the Transferor to the satisfaction of the Transferee.
5. The Transferee has not and will not nor has it authorized
or will it authorize any person to (a) offer, pledge, sell, dispose of
or otherwise transfer any Certificate, any interest in any Certificate
or any other similar security to any person in any manner, (b) solicit
any offer to buy or to accept a pledge, disposition of other transfer
of any Certificate, any interest in any Certificate or any other
similar security from any person in any manner, (c) otherwise approach
or negotiate with respect to any Certificate, any interest in any
Certificate or any other similar security with any person in any
manner, (d) make any general solicitation by means of general
advertising or in any other manner or (e) take any other action, that
(as to any of (a) through (e) above) would constitute a distribution of
any Certificate under the Act, that would render the disposition of any
Certificate a violation of Section 5 of the 1933 Act or any state
securities law, or that would require registration or qualification
pursuant thereto. The Transferee will not sell or otherwise transfer
any of the Certificates, except in compliance with the provisions of
the Pooling and Servicing Agreement.
6. The Transferee: (a) is not an employee benefit plan or
other plan subject to the prohibited transaction provisions 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") (each, a "Plan"), or any other person (including an investment
manager, a named fiduciary or a trustee of any Plan) acting, directly
or indirectly, on behalf of or purchasing any Certificate with "plan
assets" of any Plan within the meaning of the Department of Labor
("DOL") regulation at 29 C.F.R. ss. 2510.3-101 or (b) has provided the
Trustee with an opinion of counsel on which the Depositor, the Master
Servicer, the Securities Administrator, the Trustee and the Servicer
may rely, acceptable to and in form and substance satisfactory to the
Trustee to the effect that the purchase of Certificates is permissible
under applicable law, will not constitute or result in any non-exempt
prohibited transaction under ERISA or Section 4975 of the Code and will
not subject the Trust Fund, the Trustee, the Master Servicer, the
Securities Administrator, the Depositor or the Servicer to any
obligation or liability (including obligations or liabilities under
ERISA or Section 4975 of the Code) in addition to those undertaken in
the Pooling and Servicing Agreement.
In addition, the Transferee hereby certifies, represents and
warrants to, and covenants with, the Depositor, the Trustee, the Securities
Administrator, the Master Servicer and the Servicer that the Transferee will not
transfer such Certificates to any Plan or person unless such Plan or person
meets the requirements set forth in paragraph 6 above.
Very truly yours,
By:_______________________
Name:
Title:
EXHIBIT B-3
TRANSFER AFFIDAVIT AND AGREEMENT
STATE OF NEW YORK )
) ss.:
COUNTY OF NEW YORK )
___________________________ being duly sworn, deposes, represents and
warrants as follows:
1. I am a _____________________ of _______________________________
(the "Owner") a corporation duly organized and existing under the
laws of _________________________, the record owner of ACE
Securities Corp. Home Equity Loan Trust, Series 2005-HE7 Asset
Backed Pass-Through Certificates, Class R Certificates (the
"Class R Certificates"), on behalf of whom I make this affidavit
and agreement. Capitalized terms used but not defined herein have
the respective meanings assigned thereto in the Pooling and
Servicing Agreement pursuant to which the Class R Certificates
were issued.
2. The Owner (i) is and will be a "Permitted Transferee" as of
____________________. ____ and (ii) is acquiring the Class R
Certificates for its own account or for the account of another
Owner from which it has received an affidavit in substantially
the same form as this affidavit. A "Permitted Transferee" is any
person other than a "disqualified organization" or a possession
of the United States. For this purpose, a "disqualified
organization" means the United States, any state or political
subdivision thereof, any agency or instrumentality of any of the
foregoing (other than an instrumentality all of the activities of
which are subject to tax and, except for the Federal Home Loan
Mortgage Corporation, a majority of whose board of directors is
not selected by any such governmental entity) or any foreign
government, international organization or any agency or
instrumentality of such foreign government or organization, any
real electric or telephone cooperative, or any organization
(other than certain farmers' cooperatives) that is generally
exempt from federal income tax unless such organization is
subject to the tax on unrelated business taxable income.
3. The Owner is aware (i) of the tax that would be imposed on
transfers of the Class R Certificates to disqualified
organizations under the Internal Revenue Code of 1986 that
applies to all transfers of the Class R Certificates after April
31, 1988; (ii) that such tax would be on the transferor or, if
such transfer is through an agent (which person includes a
broker, nominee or middleman) for a non-Permitted Transferee, on
the agent; (iii) that the person otherwise liable for the tax
shall be relieved of liability for the tax if the transferee
furnishes to such person an affidavit that the transferee is a
Permitted Transferee and, at the time of transfer, such person
does not have actual knowledge that the affidavit is false; and
(iv) that each of the Class R Certificates may be a "noneconomic
residual interest" within the meaning of proposed Treasury
regulations promulgated under the Code and that the transferor of
a "noneconomic residual interest" will remain liable for any
taxes due with respect to the income on such residual interest,
unless no significant purpose of the transfer is to impede the
assessment or collection of tax.
4. The Owner is aware of the tax imposed on a "pass-through entity"
holding the Class R Certificates if, at any time during the
taxable year of the pass-through entity, a non-Permitted
Transferee is the record holder of an interest in such entity.
(For this purpose, a "pass-through entity" includes a regulated
investment company, a real estate investment trust or common
trust fund, a partnership, trust or estate, and certain
cooperatives.)
5. The Owner is aware that the Securities Administrator will not
register the transfer of any Class R Certificate unless the
transferee, or the transferee's agent, delivers to the Securities
Administrator, among other things, an affidavit in substantially
the same form as this affidavit. The Owner expressly agrees that
it will not consummate any such transfer if it knows or believes
that any of the representations contained in such affidavit and
agreement are false.
6. The Owner consents to any additional restrictions or arrangements
that shall be deemed necessary upon advice of counsel to
constitute a reasonable arrangement to ensure that the Class R
Certificates will only be owned, directly or indirectly, by an
Owner that is a Permitted Transferee.
7. The Owner's taxpayer identification number is ________________.
8. The Owner has reviewed the restrictions set forth on the face of
the Class R Certificates and the provisions of Section 6.02(d) of
the Pooling and Servicing Agreement under which the Class R
Certificates were issued (in particular, clauses (iii)(A) and
(iii)(B) of Section 6.02(d) which authorize the Securities
Administrator to deliver payments to a person other than the
Owner and negotiate a mandatory sale by the Securities
Administrator in the event that the Owner holds such Certificate
in violation of Section 6.02(d)); and that the Owner expressly
agrees to be bound by and to comply with such restrictions and
provisions.
9. The Owner is not acquiring and will not transfer the Class R
Certificates in order to impede the assessment or collection of
any tax.
10. The Owner anticipates that it will, so long as it holds the Class
R Certificates, have sufficient assets to pay any taxes owed by
the holder of such Class R Certificates, and hereby represents to
and for the benefit of the person from whom it acquired the Class
R Certificates that the Owner intends to pay taxes associated
with holding such Class R Certificates as they become due, fully
understanding that it may incur tax liabilities in excess of any
cash flows generated by the Class R Certificates.
11. The Owner has no present knowledge that it may become insolvent
or subject to a bankruptcy proceeding for so long as it holds the
Class R Certificates.
12. The Owner has no present knowledge or expectation that it will be
unable to pay any United States taxes owed by it so long as any
of the Certificates remain outstanding.
13. The Owner is not acquiring the Class R Certificates with the
intent to transfer the Class R Certificates to any person or
entity that will not have sufficient assets to pay any taxes owed
by the holder of such Class R Certificates, or that may become
insolvent or subject to a bankruptcy proceeding, for so long as
the Class R Certificates remain outstanding.
14. The Owner will, in connection with any transfer that it makes of
the Class R Certificates, obtain from its transferee the
representations required by Section 6.02(d) of the Pooling and
Servicing Agreement under which the Class R Certificate were
issued and will not consummate any such transfer if it knows, or
knows facts that should lead it to believe, that any such
representations are false.
15. The Owner will, in connection with any transfer that it makes of
the Class R Certificates, deliver to the Securities Administrator
an affidavit, which represents and warrants that it is not
transferring the Class R Certificates to impede the assessment or
collection of any tax and that it has no actual knowledge that
the proposed transferee: (i) has insufficient assets to pay any
taxes owed by such transferee as holder of the Class R
Certificates; (ii) may become insolvent or subject to a
bankruptcy proceeding for so long as the Class R Certificates
remains outstanding; and (iii) is not a "Permitted Transferee".
16. The Owner is a citizen or resident of the United States, a
corporation, partnership or other entity created or organized in,
or under the laws of, the United States or any political
subdivision thereof, or an estate or trust whose income from
sources without the United States may be included in gross income
for United States federal income tax purposes regardless of its
connection with the conduct of a trade or business within the
United States.
17. The Owner of the Class R Certificate, hereby agrees that in the
event that the Trust Fund created by the Pooling and Servicing
Agreement is terminated pursuant to Section 10.01 thereof, the
undersigned shall assign and transfer to the Holders of the Class
CE and the Class P Certificates any amounts in excess of par
received in connection with such termination. Accordingly, in the
event of such termination, the Securities Administrator is hereby
authorized to withhold any such amounts in excess of par and to
pay such amounts directly to the Holders of the Class CE and the
Class P Certificates. This agreement shall bind and be
enforceable against any successor, transferee or assigned of the
undersigned in the Class R Certificate. In connection with any
transfer of the Class R Certificate, the Owner shall obtain an
agreement substantially similar to this clause from any
subsequent owner.
IN WITNESS WHEREOF, the Owner has caused this instrument to be executed on
its behalf, pursuant to the authority of its Board of Directors, by its [Vice]
President, attested by its [Assistant] Secretary, this ____ day of
_________________, ____.
[OWNER]
By:_______________________
Name:
Title: [Vice] President
ATTEST:
By:----------------------------
Name:
Title: [Assistant] Secretary
Personally appeared before me the above-named __________________, known or
proved to me to be the same person who executed the foregoing instrument and to
be a [Vice] President of the Owner, 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 Owner.
Subscribed and sworn before me this ______________ day of __________, ____.
_______________________________________
Notary Public
County of _____________________________
State of ______________________________
My Commission expires:
FORM OF TRANSFEROR AFFIDAVIT
STATE OF NEW YORK )
) ss.:
COUNTY OF NEW YORK )
_________________________, being duly sworn, deposes, represents and
warrants as follows:
1. I am a ____________________ of _________________________
(the "Owner"), a corporation duly organized and existing under the laws of
_____________, on behalf of whom I make this affidavit.
2. The Owner is not transferring the Class R Certificates (the
"Residual Certificates") to impede the assessment or collection of any tax.
3. The Owner has no actual knowledge that the Person that is
the proposed transferee (the "Purchaser") of the Residual Certificates: (i) has
insufficient assets to pay any taxes owed by such proposed transferee as holder
of the Residual Certificates; (ii) may become insolvent or subject to a
bankruptcy proceeding for so long as the Residual Certificates remain
outstanding and (iii) is not a Permitted Transferee.
4. The Owner understands that the Purchaser has delivered to
the Trustee or a transfer affidavit and agreement in the form attached to the
Pooling and Servicing Agreement as Exhibit B-2. The Owner does not know or
believe that any representation contained therein is false.
5. At the time of transfer, the Owner has conducted a
reasonable investigation of the financial condition of the Purchaser as
contemplated by Treasury Regulations Section 1.860E-1(c)(4)(i) and, as a result
of that investigation, the Owner has determined that the Purchaser has
historically paid its debts as they became due and has found no significant
evidence to indicate that the Purchaser will not continue to pay its debts as
they become due in the future. The Owner understands that the transfer of a
Residual Certificate may not be respected for United States income tax purposes
(and the Owner may continue to be liable for United States income taxes
associated therewith) unless the Owner has conducted such an investigation.
6. Capitalized terms not otherwise defined herein shall have
the meanings ascribed to them in the Pooling and Servicing Agreement.
IN WITNESS WHEREOF, the Owner has caused this instrument to be executed on
its behalf, pursuant to the authority of its Board of Directors, by its [Vice]
President, attested by its [Assistant] Secretary, this ____ day of
________________, ____.
[OWNER]
By:_______________________
Name:
Title: [Vice] President
ATTEST:
By:____________________________
Name:
Title: [Assistant] Secretary
Personally appeared before me the above-named _________________, known or
proved to me to be the same person who executed the foregoing instrument and to
be a [Vice] President of the Owner, 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 Owner.
Subscribed and sworn before me this ______ day of _____________, ____.
________________________________________
Notary Public
County of ______________________________
State of _______________________________
My Commission expires:
EXHIBIT C
FORM OF SERVICER CERTIFICATION
Re: __________ (the "Trust")
MORTGAGE PASS-THROUGH CERTIFICATES, SERIES 2005-HE7
I, [identify the certifying individual], certify to ACE Securities Corp. (the
"Depositor"), HSBC Bank USA, National Association (the "Trustee") and ▇▇▇▇▇
Fargo Bank, National Association (the "Master Servicer"), and their respective
officers, directors and affiliates, and with the knowledge and intent that they
will rely upon this certification, that:
1. Based on my knowledge, the information in the Annual Statement
of Compliance, the Annual Independent Public Accountant's
Servicing Report and all servicing reports, officer's
certificates and other information relating to the servicing
of the Mortgage Loans submitted to the Master Servicer taken
as a whole, does not contain any untrue statement of a
material fact or omit to state a material fact (constituting
information required to be provided by ▇▇▇▇▇ Fargo Bank, N.A.
as Servicer (the "Servicer") under the Agreement) necessary to
make the statements made, in light of the circumstances under
which such statements were made, not misleading as of the date
of this certification.
2. Based on my knowledge, the servicing information required to
be provided to Master Servicer by the Servicer under the
Agreement has been provided to the Master Servicer.
3. I am responsible for reviewing the activities performed by the
Servicer under the Agreement and based upon my knowledge and
the review required by the Agreement, and except as disclosed
in the Annual Statement of Compliance or the Annual
Independent Public Accountant's Servicing Report submitted to
the Master Servicer, the Servicer has fulfilled its
obligations under the Agreement; and
4. I have disclosed to the Master Servicer all significant
deficiencies relating to the Servicer's compliance with the
minimum servicing standards in accordance with a review
conducted in compliance with the Uniform Single Attestation
Program for Mortgage Bankers or similar standard as set forth
in the Pooling and Servicing Agreement.
Capitalized terms used and not otherwise defined herein have the meanings
assigned thereto in the Pooling and Servicing Agreement, dated as of November 1,
2005, among ACE Securities Corp., ▇▇▇▇▇ Fargo Bank, N.A., ▇▇▇▇▇ Fargo Bank,
National Association and HSBC Bank USA, National Association.
Date:
----------------------------
---------------------------------
[Signature]
---------------------------------
[Title]
EXHIBIT D
FORM OF POWER OF ATTORNEY
RECORDING REQUESTED BY
AND WHEN RECORDED MAIL TO
▇▇▇▇▇ Fargo Bank, N.A.
▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇
▇▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇▇
Attn: _________________________________
LIMITED POWER OF ATTORNEY
KNOW ALL MEN BY THESE PRESENTS, that ________________, having its principal
place of business at ____________________, as Trustee (the "Trustee") pursuant
to that Pooling and Servicing Agreement among ___________________ (the
"Depositor"), ▇▇▇▇▇ Fargo Bank, National Association, as Master Servicer and
Securities Administrator, ▇▇▇▇▇ Fargo Bank, N.A. as the Servicer (the
"Servicer") and the Trustee, dated as of November 1, 2005 (the "Pooling and
Servicing Agreement"), hereby constitutes and appoints the Servicer, by and
through the Servicer's officers, the Trustee's true and lawful Attorney-in-Fact,
in the Trustee's name, place and stead and for the Trustee's benefit, in
connection with all mortgage loans serviced by the Servicer pursuant to the
Pooling and Servicing Agreement for the purpose of performing all acts and
executing all documents in the name of the Trustee as may be customarily and
reasonably necessary and appropriate to effectuate the following enumerated
transactions in respect of any of the mortgages or deeds of trust (the
"Mortgages" and the "Deeds of Trust", respectively) and promissory notes secured
thereby (the "Mortgage Notes") for which the undersigned is acting as Trustee
for various certificateholders (whether the undersigned is named therein as
mortgagee or beneficiary or has become mortgagee by virtue of endorsement of the
Mortgage Note secured by any such Mortgage or Deed of Trust) and for which the
Servicer is acting as servicer, all subject to the terms of the Pooling and
Servicing Agreement.
This appointment shall apply to the following enumerated transactions only:
1. The modification or re-recording of a Mortgage or Deed of
Trust, where said modification or re-recordings is for the
purpose of correcting the Mortgage or Deed of Trust to conform
same to the original intent of the parties thereto or to
correct title errors discovered after such title insurance was
issued and said modification or re-recording, in either
instance, does not adversely affect the lien of the Mortgage
or Deed of Trust as insured.
2. The subordination of the lien of a Mortgage or Deed of Trust
to an easement in favor of a public utility company of a
government agency or unit with powers of eminent domain; this
section shall include, without limitation, the execution of
partial satisfactions/releases, partial reconveyances or the
execution or requests to trustees to accomplish same.
3. The conveyance of the properties to the mortgage insurer, or
the closing of the title to the property to be acquired as
real estate owned, or conveyance of title to real estate
owned.
4. The completion of loan assumption agreements.
5. The full satisfaction/release of a Mortgage or Deed of Trust
or full conveyance upon payment and discharge of all sums
secured thereby, including, without limitation, cancellation
of the related Mortgage Note.
6. The assignment of any Mortgage or Deed of Trust and the
related Mortgage Note, in connection with the repurchase of
the mortgage loan secured and evidenced thereby.
7. The full assignment of a Mortgage or Deed of Trust upon
payment and discharge of all sums secured thereby in
conjunction with the refinancing thereof, including, without
limitation, the assignment of the related Mortgage Note.
8. With respect to a Mortgage or Deed of Trust, the foreclosure,
the taking of a deed in lieu of foreclosure, or the completion
of judicial or non-judicial foreclosure or termination,
cancellation or rescission of any such foreclosure, including,
without limitation, any and all of the following acts:
a. the substitution of trustee(s) serving under a Deed of
Trust, in accordance with state law and the Deed of
Trust;
b. the preparation and issuance of statements of breach or
non-performance;
c. the preparation and filing of notices of default and/or
notices of sale;
d. the cancellation/rescission of notices of default
and/or notices of sale;
e. the taking of a deed in lieu of foreclosure; and
f. the preparation and execution of such other documents
and performance of such other actions as may be
necessary under the terms of the Mortgage, Deed of
Trust or state law to expeditiously complete said
transactions in paragraphs 8.a. through 8.e., above.
The undersigned gives said Attorney-in-Fact full power and authority to execute
such instruments and to do and perform all and every act and thing necessary and
proper to carry into effect the power or powers granted by or under this Limited
Power of Attorney as fully as the undersigned might or could do, and hereby does
ratify and confirm to all that said Attorney-in-Fact shall lawfully do or cause
to be done by authority hereof.
Third parties without actual notice may rely upon the exercise of the power
granted under this Limited Power of attorney; and may be satisfied that this
Limited Power of Attorney shall continue in full force and effect and has not
been revoked unless an instrument of revocation has been made in writing by the
undersigned.
IN WITNESS WHEREOF, ________________ as Trustee pursuant to that Pooling and
Servicing Agreement among the Depositor, ▇▇▇▇▇ Fargo Bank, National Association,
▇▇▇▇▇ Fargo Bank, N.A. and the Trustee, dated as of ___________ 1, 200__
(_____________ Asset Backed Certificates, Series 200__-___), has caused its
corporate seal to be hereto affixed and these presents to be signed and
acknowledged in its name and behalf by ____________ its duly elected and
authorized Vice President this _________ day of _________, 200__.
-----------------------------------------
as Trustee for _____ Asset
Backed Certificates, Series 200__-___
By:
----------------
----------------
STATE OF _____________
COUNTY OF ___________
On _______________, 200__, before me, the undersigned, a Notary Public in and
for said state, personally appeared ____________, Vice President of
____________________ as Trustee for ___________ Asset Backed Certificates,
Series 200__-___, personally known to me to be the person whose name is
subscribed to the within instrument and acknowledged to me that he/she executed
that same in his/her authorized capacity, and that by his/her signature on the
instrument the entity upon behalf of which the person acted and executed the
instrument.
WITESS my hand and official seal.
(SEAL)
--------------------------
Notary Public
My Commission Expires ____
SCHEDULE 1
MORTGAGE LOAN SCHEDULE
SCHEDULE 2
PREPAYMENT CHARGE SCHEDULE
Filed by paper
SCHEDULE 4
STANDARD FILE LAYOUT- DELINQUENCY REPORTING
EXHIBIT 1: STANDARD FILE LAYOUT - DELINQUENCY REPORTING
COLUMN/HEADER NAME DESCRIPTION DECIMAL FORMAT COMMENT
------------------ ----------- ------- --------------
SERVICER_LOAN_NBR A unique number assigned to a loan by the Servicer. This
may be different than the LOAN_NBR
LOAN_NBR A unique identifier assigned to each loan by the originator.
CLIENT_NBR Servicer Client Number
SERV_INVESTOR_NBR Contains a unique number as
assigned by an external servicer
to identify a group of loans in
their system.
BORROWER_FIRST_NAME First Name of the Borrower.
BORROWER_LAST_NAME Last name of the borrower.
PROP_ADDRESS Street Name and Number of Property
PROP_STATE The state where the property located.
PROP_ZIP Zip code where the property is located.
BORR_NEXT_PAY_DUE_DATE The date that the borrower's next
payment is due to the MM/DD/YYYY
servicer at the end of processing
cycle, as reported by Servicer.
LOAN_TYPE Loan Type (i.e. FHA, VA, Conv)
BANKRUPTCY_FILED_DATE The date a particular bankruptcy claim was filed. MM/DD/YYYY
BANKRUPTCY_CHAPTER_CODE The chapter under which the bankruptcy was filed.
BANKRUPTCY_CASE_NBR The case number assigned by the court to the bankruptcy
filing.
POST_PETITION_DUE_DATE The payment due date once the bankruptcy has been approved MM/DD/YYYY
by the courts
BANKRUPTCY_DCHRG_DISM_DATE The Date The Loan Is Removed From Bankruptcy. Either by MM/DD/YYYY
Dismissal, Discharged and/or a Motion For Relief Was
Granted.
LOSS_MIT_APPR_DATE The Date The Loss Mitigation Was Approved By The Servicer MM/DD/YYYY
LOSS_MIT_TYPE The Type Of Loss Mitigation Approved For A Loan Such As;
LOSS_MIT_EST_COMP_DATE The Date The Loss Mitigation /Plan Is Scheduled To End/Close MM/DD/YYYY
LOSS_MIT_ACT_COMP_DATE The Date The Loss Mitigation Is Actually Completed MM/DD/YYYY
FRCLSR_APPROVED_DATE The date DA Admin sends a letter to the servicer with MM/DD/YYYY
instructions to begin foreclosure proceedings.
ATTORNEY_REFERRAL_DATE Date File Was Referred To Attorney to Pursue Foreclosure MM/DD/YYYY
FIRST_LEGAL_DATE Notice of 1st legal filed by an Attorney in a Foreclosure MM/DD/YYYY
Action
FRCLSR_SALE_EXPECTED_DATE The date by which a foreclosure sale is expected to occur. MM/DD/YYYY
FRCLSR_SALE_DATE The actual date of the foreclosure sale. MM/DD/YYYY
FRCLSR_SALE_AMT The amount a property sold for at the foreclosure sale. 2 No commas(,)
or dollar
signs ($)
EVICTION_START_DATE The date the servicer initiates eviction of the borrower. MM/DD/YYYY
EVICTION_COMPLETED_DATE The date the court revokes legal possession of the property MM/DD/YYYY
from the borrower.
LIST_PRICE The price at which an REO property is marketed. 2 No commas(,)
or dollar
signs ($)
LIST_DATE The date an REO property is listed at a particular price. MM/DD/YYYY
OFFER_AMT The dollar value of an offer for an REO property. 2 No commas(,)
or dollar
signs ($)
OFFER_DATE_TIME The date an offer is received by DA Admin or by the Servicer. MM/DD/YYYY
REO_CLOSING_DATE The date the REO sale of the property is scheduled to close. MM/DD/YYYY
REO_ACTUAL_CLOSING_DATE Actual Date Of REO Sale MM/DD/YYYY
OCCUPANT_CODE Classification of how the property is occupied.
PROP_CONDITION_CODE A code that indicates the condition of the property.
PROP_INSPECTION_DATE The date a property inspection is performed. MM/DD/YYYY
APPRAISAL_DATE The date the appraisal was done. MM/DD/YYYY
CURR_PROP_VAL The current "as is" value of the property based on brokers 2
price opinion or appraisal.
REPAIRED_PROP_VAL The amount the property would be
worth if repairs are 2 completed
pursuant to a broker's price
opinion or appraisal.
IF APPLICABLE:
DELINQ_STATUS_CODE FNMA Code Describing Status of Loan
DELINQ_REASON_CODE The circumstances which caused a
borrower to stop paying on a loan.
Code indicates the reason why the
loan is in default for this cycle.
MI_CLAIM_FILED_DATE Date Mortgage Insurance Claim Was Filed With Mortgage MM/DD/YYYY
Insurance Company.
MI_CLAIM_AMT Amount of Mortgage Insurance Claim Filed No commas(,)
or dollar
signs ($)
MI_CLAIM_PAID_DATE Date Mortgage Insurance Company Disbursed Claim Payment MM/DD/YYYY
MI_CLAIM_AMT_PAID Amount Mortgage Insurance Company Paid On Claim 2 No commas(,)
or dollar
signs ($)
POOL_CLAIM_FILED_DATE Date Claim Was Filed With Pool Insurance Company MM/DD/YYYY
POOL_CLAIM_AMT Amount of Claim Filed With Pool Insurance Company 2 No commas(,)
or dollar
signs ($)
POOL_CLAIM_PAID_DATE Date Claim Was Settled and The Check Was Issued By The Pool MM/DD/YYYY
Insurer
POOL_CLAIM_AMT_PAID Amount Paid On Claim By Pool Insurance Company 2 No commas(,)
or dollar
signs ($)
FHA_PART_A_CLAIM_FILED_DATE Date FHA Part A Claim Was Filed With HUD MM/DD/YYYY
FHA_PART_A_CLAIM_AMT Amount of FHA Part A Claim Filed 2 No commas(,)
or dollar
signs ($)
FHA_PART_A_CLAIM_PAID_DATE Date HUD Disbursed Part A Claim Payment MM/DD/YYYY
FHA_PART_A_CLAIM_PAID_AMT Amount HUD Paid on Part A Claim 2 No commas(,)
or dollar
signs ($)
FHA_PART_B_CLAIM_FILED_DATE Date FHA Part B Claim Was Filed With HUD MM/DD/YYYY
FHA_PART_B_CLAIM_AMT Amount of FHA Part B Claim Filed 2 No commas(,)
or dollar
signs ($)
FHA_PART_B_CLAIM_PAID_DATE Date HUD Disbursed Part B Claim Payment MM/DD/YYYY
FHA_PART_B_CLAIM_PAID_AMT Amount HUD Paid on Part B Claim 2 No commas(,)
or dollar
signs ($)
VA_CLAIM_FILED_DATE Date VA Claim Was Filed With the Veterans Admin MM/DD/YYYY
VA_CLAIM_PAID_DATE Date Veterans Admin. Disbursed VA Claim Payment MM/DD/YYYY
VA_CLAIM_PAID_AMT Amount Veterans Admin. Paid on VA Claim 2 No commas(,)
or dollar
signs ($)
EXHIBIT 2: STANDARD FILE CODES - DELINQUENCY REPORTING
The LOSS MIT TYPE field should show the approved Loss Mitigation Code as
follows:
o ASUM- Approved Assumption
o BAP- Borrower Assistance Program
o CO- Charge Off
o DIL- Deed-in-Lieu
o FFA- Formal Forbearance Agreement
o MOD- Loan Modification
o PRE- Pre-Sale
o SS- Short Sale
o MISC- Anything else approved by the PMI or Pool Insurer
NOTE: ▇▇▇▇▇ Fargo Bank will accept alternative Loss Mitigation Types to those
above, provided that they are consistent with industry standards. If Loss
Mitigation Types other than those above are used, the Servicer must supply ▇▇▇▇▇
Fargo Bank with a description of each of the Loss Mitigation Types prior to
sending the file.
The OCCUPANT CODE field should show the current status of the property code as
follows:
o Mortgagor
o Tenant
o Unknown
o Vacant
The PROPERTY CONDITION field should show the last reported condition of the
property as follows:
o Damaged
o Excellent
o Fair
o Gone
o Good
o Poor
o Special Hazard
o Unknown
EXHIBIT 2: STANDARD FILE CODES - DELINQUENCY REPORTING, CONTINUED
The FNMA DELINQUENT REASON CODE field should show the Reason for Delinquency as
follows:
DELINQUENCY CODE DELINQUENCY DESCRIPTION
---------------- -----------------------
001 FNMA-Death of principal mortgagor
002 FNMA-Illness of principal mortgagor
003 FNMA-Illness of mortgagor's family member
004 FNMA-Death of mortgagor's family member
005 FNMA-Marital difficulties
006 FNMA-Curtailment of income
007 FNMA-Excessive Obligation
008 FNMA-Abandonment of property
009 FNMA-Distant employee transfer
011 FNMA-Property problem
012 FNMA-Inability to sell property
013 FNMA-Inability to rent property
014 FNMA-Military Service
015 FNMA-Other
016 FNMA-Unemployment
017 FNMA-Business failure
019 FNMA-Casualty loss
022 FNMA-Energy environment costs
023 FNMA-Servicing problems
026 FNMA-Payment adjustment
027 FNMA-Payment dispute
029 FNMA-Transfer of ownership pending
030 FNMA-Fraud
031 FNMA-Unable to contact borrower
INC FNMA-Incarceration
EXHIBIT 2: STANDARD FILE CODES - DELINQUENCY REPORTING, CONTINUED
The FNMA DELINQUENT STATUS CODE field should show the Status of Default as
follows:
STATUS CODE STATUS DESCRIPTION
----------- ------------------
09 Forbearance
17 Pre-foreclosure Sale Closing Plan Accepted
24 Government Seizure
26 Refinance
27 Assumption
28 Modification
29 Charge-Off
30 Third Party Sale
31 Probate
32 Military Indulgence
43 Foreclosure Started
44 Deed-in-Lieu Started
49 Assignment Completed
61 Second Lien Considerations
62 Veteran's Affairs-No Bid
63 Veteran's Affairs-Refund
64 Veteran's Affairs-Buydown
65 Chapter 7 Bankruptcy
66 Chapter 11 Bankruptcy
67 Chapter 13 Bankruptcy
EXHIBIT 3: CALCULATION OF REALIZED LOSS/GAIN FORM 332- INSTRUCTION SHEET
1. The numbers on the form correspond with the numbers
listed below.
LIQUIDATION AND ACQUISITION EXPENSES:
1. The Actual Unpaid Principal Balance of the Mortgage Loan. For
documentation, an Amortization Schedule from date of default
through liquidation breaking out the net interest and
servicing fees advanced is required.
2. The Total Interest Due less the aggregate amount of servicing
fee that would have been earned if all delinquent payments had
been made as agreed. For documentation, an Amortization
Schedule from date of default through liquidation breaking out
the net interest and servicing fees advanced is required.
3. Accrued Servicing Fees based upon the Scheduled Principal
Balance of the Mortgage Loan as calculated on a monthly basis.
For documentation, an Amortization Schedule from date of
default through liquidation breaking out the net interest and
servicing fees advanced is required.
4-12. Complete as applicable. All line entries must be supported by
copies of appropriate statements, vouchers, receipts, bills,
canceled checks, etc., to document the expense. Entries not
properly documented will not be reimbursed to the Servicer.
13. The total of lines 1 through 12.
2. CREDITS:
14-21. Complete as applicable. All line entries must be supported by
copies of the appropriate claims forms, EOBs, HUD-1 and/or
other proceeds verification, statements, payment checks, etc.
to document the credit. If the Mortgage Loan is subject to a
Bankruptcy Deficiency, the difference between the Unpaid
Principal Balance of the Note prior to the Bankruptcy
Deficiency and the Unpaid Principal Balance as reduced by the
Bankruptcy Deficiency should be input on line 20.
22. The total of lines 14 through 21.
PLEASE NOTE: For HUD/VA loans, use line (15) for Part A/Initial
proceeds and line (16) for Part B/Supplemental proceeds.
3. TOTAL REALIZED LOSS (OR AMOUNT OF ANY GAIN)
23. The total derived from subtracting line 22 from 13.
If the amount represents a realized gain, show the amount
in parenthesis ( ).
EXHIBIT 3A: CALCULATION OF REALIZED LOSS/GAIN FORM 332
▇▇▇▇▇ FARGO BANK, N.A.
CALCULATION OF REALIZED LOSS/GAIN
Prepared by: __________________ Date: _______________
Phone: ______________________ Email Address:_____________________
--------------------- ------------------- ----------------------
Servicer Loan No. Servicer Name Servicer Address
--------------------- ------------------- ----------------------
▇▇▇▇▇ FARGO BANK, N.A. Loan No._____________________________
Borrower's Name:_______________________________________________________
Property Address:______________________________________________________
LIQUIDATION AND ACQUISITION EXPENSES:
(1) Actual Unpaid Principal Balance
of Mortgage Loan $________________ (1)
(2) Interest accrued at Net Rate ________________ (2)
(3) Accrued Servicing Fees ________________ (3)
(4) Attorney's Fees ________________ (4)
(5) Taxes ________________ (5)
(6) Property Maintenance ________________ (6)
(7) MI/Hazard Insurance Premiums ________________ (7)
(8) Utility Expenses ________________ (8)
(9) Appraisal/BPO ________________ (9)
(10) Property Inspections ________________ (10)
(11) FC Costs/Other Legal Expenses ________________ (11)
(12) Other (itemize) $________________ (12)
Cash for Keys __________________________ _______________
HOA/Condo Fees__________________________ _______________
TOTAL EXPENSES $ _______________ (13)
CREDITS:
(14) Escrow Balance $ _______________ (14)
(15) HIP Refund ________________ (15)
(16) Rental Receipts ________________ (16)
(17) Hazard Loss Proceeds ________________ (17)
(18) Primary Mortgage Insurance
Proceeds ________________ (18)
(19) Pool Insurance Proceeds ________________ (19)
(20) Proceeds from Sale of Acquired Property ________________ (20)
(21) Other (itemize) ________________ (21)
---------------------------------------- ----------------
---------------------------------------- ----------------
TOTAL CREDITS $ _______________ (22)
TOTAL REALIZED LOSS (OR AMOUNT OF GAIN) $ _______________ (23)
SCHEDULE 5
STANDARD FILE LAYOUT- SCHEDULED/SCHEDULED
EXHIBIT 1: STANDARD FILE LAYOUT - SCHEDULED/SCHEDULED
COLUMN NAME DESCRIPTION DECIMAL FORMAT COMMENT
------------------------------- -------------------------------------------------- ----------- ------------------------------------
LOAN_NBR Loan Number assigned by investor Text up to 10 digits
SERVICER LOAN_NBR Servicer Loan Number Text up to 10 digits
BORROWER_NAME Mortgagor name assigned to Note Max length of 30
SCHED_PMT_AMT P&I constant 2 No commas(,) or dollar signs ($)
NOTE_INT_RATE Gross Interest Rate 4 Max length of 6
NET_RATE Gross Interest Rate less the Service Fee Rate 4 Max length of 6
SERV_FEE_RATE Service Fee Rate 4 Max length of 6
NEW_PAY_AMT ARM loan's forecasted P&I constant 2 No commas(,) or dollar signs ($)
NEW_LOAN_RATE ARM loan's forecasted Gross Interest Rate 4 Max length of 6
ARM_INDEX_RATE ARM loan's index Rate used 4 Max length of 6
ACTL_BEG_BAL Beginning Actual Balance 2 No commas(,) or dollar signs ($)
ACTL_END_BAL Ending Actual Balance 2 No commas(,) or dollar signs ($)
NEXT_DUE_DATE Borrower's next due date MM/DD/YYYY
CURT_AMT_1 Curtailment Amount 2 No commas(,) or dollar signs ($)
CURT_DATE_1 Due date Curtailment was applied to MM/DD/YYYY
CURT_ADJ_ AMT_1 Curtailment Interest if applicable 2 No commas(,) or dollar signs ($)
CURT_AMT_2 Curtailment Amount 2 2 No commas(,) or dollar signs ($)
CURT_DATE_2 Due date Curtailment was applied to MM/DD/YYYY
CURT_ADJ_ AMT2 Curtailment Interest if applicable 2 No commas(,) or dollar signs ($)
CURT_AMT_3 Curtailment Amount 3 2 No commas(,) or dollar signs ($)
CURT_DATE_3 Due date Curtailment was applied to MM/DD/YYYY
CURT_ADJ_AMT3 Curtailment Interest, if applicable 2 No commas(,) or dollar signs ($)
SCHED_BEG_BAL Beginning Scheduled Balance 2 No commas(,) or dollar signs ($)
SCHED_END_BAL Ending Scheduled Balance 2 No commas(,) or dollar signs ($)
SCHED_PRIN_AMT Scheduled Principal portion of P&I 2 No commas(,) or dollar signs ($)
Scheduled Net Interest (less Service Fee)
SCHED_NET_INT portion of P&I 2 No commas(,) or dollar signs ($)
Liquidation Principal Amt to bring balance to
LIQ_AMT zero 2 No commas(,) or dollar signs ($)
PIF_DATE Liquidation Date MM/DD/YYYY
ACTION_CODE Either 60 for liquidation or 65 for Repurchase Max length of 2
PRIN_ADJ_AMT Principal Adjustments made to loan, if applicable 2 No commas(,) or dollar signs ($)
INT_ADJ_AMT Interest Adjustment made to loan, if applicable 2 No commas(,) or dollar signs ($)
PREPAYMENT PENALTY AMT Prepayment penalty amount, if applicable 2 No commas(,) or dollar signs ($)
Soldier and Sailor Adjustment amount, if
SOILDER_SAILOR ADJ AMT applicable 2 No commas(,) or dollar signs ($)
NON ADV LOAN AMT Non Recoverable Loan Amount, if applicable 2 No commas(,) or dollar signs ($)
SCHEDULE 6
DATA REQUIREMENTS OF SERVICING ADVANCES INCURRED PRIOR TO CUT-OFF DATE
-------------------------- -----------------------------------------------------
[LOAN NUMBER] [PRE-CUT-OFF DATE ADVANCE AMOUNT]
-------------------------- -----------------------------------------------------