EXECUTION COPY
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▇▇▇▇▇▇▇ ▇▇▇▇▇ MORTGAGE INVESTORS, INC.,
Depositor
CREDIT-BASED ASSET SERVICING AND SECURITIZATION LLC,
Seller
▇▇▇▇▇▇ LOAN SERVICING LP,
Servicer
and
U.S. BANK NATIONAL ASSOCIATION,
Trustee
POOLING AND SERVICING AGREEMENT
Dated as of August 1, 2004
2004-CB6 Trust
C-BASS Mortgage Loan Asset-Backed Certificates, Series 2004-CB6
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TABLE OF CONTENTS
PAGE
ARTICLE I DEFINITIONS............................................................................... 5
Section 1.01 Defined Terms.................................................................... 5
Section 1.02 Accounting....................................................................... 51
ARTICLE II CONVEYANCE OF MORTGAGE LOANS; ORIGINAL ISSUANCE OF CERTIFICATES.......................... 51
Section 2.01 Conveyance of Mortgage Loans..................................................... 51
Section 2.02 Acceptance by Trustee............................................................ 54
Section 2.03 Repurchase or Substitution of Mortgage Loans by the Seller....................... 55
Section 2.04 Representations and Warranties of the Seller with Respect to the Mortgage Loans.. 58
Section 2.05 Representations, Warranties and Covenants of the Servicer........................ 59
Section 2.06 Representations and Warranties of the Depositor.................................. 61
Section 2.07 Issuance of Certificates and the Uncertificated Regular Interests................ 62
Section 2.08 Representations and Warranties of the Seller..................................... 63
Section 2.09 Covenants of the Seller.......................................................... 65
ARTICLE III ADMINISTRATION AND SERVICING OF THE TRUST FUND............................................ 65
Section 3.01 Servicer to Act as Servicer...................................................... 65
Section 3.02 Collection of Mortgage Loan Payments............................................. 67
Section 3.03 Realization Upon Defaulted Mortgage Loans........................................ 67
Section 3.04 Collection Account and Distribution Account...................................... 69
Section 3.05 Permitted Withdrawals From the Collection Account................................ 70
Section 3.06 Establishment of Escrow Account; Deposits in Escrow Account...................... 71
Section 3.07 Permitted Withdrawals From Escrow Account........................................ 72
Section 3.08 Payment of Taxes, Insurance and Other Charges; Collections Thereunder............ 72
Section 3.09 Transfer of Accounts............................................................. 73
Section 3.10 Maintenance of Hazard Insurance.................................................. 74
Section 3.11 Maintenance of Mortgage Impairment Insurance Policy.............................. 74
Section 3.12 Fidelity Bond, Errors and Omissions Insurance.................................... 75
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TABLE OF CONTENTS
(continued)
PAGE
Section 3.13 Title, Management and Disposition of REO Property and Certain Delinquent
Mortgage Loans................................................................... 75
Section 3.14 Due-on-Sale Clauses; Assumption and Substitution Agreements...................... 77
Section 3.15 Notification of Adjustments...................................................... 78
Section 3.16 Optional Purchases of Mortgage Loans by Servicer................................. 79
Section 3.17 Trustee to Cooperate; Release of Files........................................... 79
Section 3.18 Servicing Compensation........................................................... 80
Section 3.19 Annual Statement as to Compliance................................................ 81
Section 3.20 Annual Independent Certified Public Accountants' Reports......................... 81
Section 3.21 Access to Certain Documentation and Information Regarding the Mortgage Loans..... 82
Section 3.22 Reserved......................................................................... 82
Section 3.23 Obligations of the Servicer in Respect of Compensating Interest.................. 82
Section 3.24 Obligations of the Servicer in Respect of Mortgage Interest Rates and
Monthly Payments................................................................. 82
Section 3.25 Investment of Funds in the Collection Account and the Distribution Account....... 82
Section 3.26 Liability of Servicer; Indemnification........................................... 83
Section 3.27 Reports of Foreclosure and Abandonment of Mortgaged Properties................... 85
Section 3.28 Protection of Assets............................................................. 85
Section 3.29 Periodic Filings................................................................. 85
Section 3.30 Advance Facility................................................................. 87
Section 3.31 Certificate Insurer Access....................................................... 89
ARTICLE IV FLOW OF FUNDS............................................................................. 90
Section 4.01 Interest Distributions........................................................... 90
Section 4.02 Distributions of Principal and Monthly Excess Cashflow Amounts................... 91
Section 4.03 Allocation of Losses............................................................. 98
Section 4.04 Method of Distribution........................................................... 98
Section 4.05 Distributions on Book-Entry Certificates......................................... 99
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TABLE OF CONTENTS
(continued)
PAGE
Section 4.06 Statements....................................................................... 99
Section 4.07 Remittance Reports; Advances..................................................... 102
Section 4.08 REMIC Distributions.............................................................. 103
ARTICLE V THE CERTIFICATES.......................................................................... 107
Section 5.01 The Certificates................................................................. 107
Section 5.02 Registration of Transfer and Exchange of Certificates............................ 108
Section 5.03 Mutilated, Destroyed, Lost or Stolen Certificates................................ 114
Section 5.04 Persons Deemed Owners............................................................ 114
Section 5.05 Appointment of Paying Agent...................................................... 115
Section 5.06 The Certificate Insurance Policy................................................. 115
Section 5.07 Effect of Payments by the Certificate Insurer, Subrogation....................... 117
ARTICLE VI THE SELLER, THE SERVICER AND THE DEPOSITOR................................................ 118
Section 6.01 Liability of the Seller, the Servicer and the Depositor.......................... 118
Section 6.02 Merger or Consolidation of, or Assumption of the Obligations of, the
Seller, the Servicer or the Depositor............................................ 118
Section 6.03 Limitation on Liability of the Servicer and Others............................... 119
Section 6.04 Servicer Not to Resign........................................................... 119
Section 6.05 Delegation of Duties............................................................. 120
ARTICLE VII DEFAULT................................................................................... 121
Section 7.01 Servicer Events of Termination................................................... 121
Section 7.02 Trustee to Act; Appointment of Successor......................................... 123
Section 7.03 Waiver of Defaults............................................................... 124
Section 7.04 Notification to Certificateholders............................................... 124
Section 7.05 Survivability of Servicer Liabilities............................................ 125
ARTICLE VIII THE TRUSTEE............................................................................... 125
Section 8.01 Duties of Trustee................................................................ 125
Section 8.02 Certain Matters Affecting the Trustee............................................ 127
Section 8.03 Trustee Not Liable for Certificates or Mortgage Loans............................ 128
Section 8.04 Trustee May Own Certificates..................................................... 129
Section 8.05 Seller to Pay Trustee Fees and Expenses.......................................... 129
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TABLE OF CONTENTS
(continued)
PAGE
Section 8.06 Eligibility Requirements for Trustee............................................. 130
Section 8.07 Resignation or Removal of Trustee................................................ 130
Section 8.08 Successor Trustee................................................................ 131
Section 8.09 Merger or Consolidation of Trustee............................................... 131
Section 8.10 Appointment of Co-Trustee or Separate Trustee.................................... 131
Section 8.11 Limitation of Liability.......................................................... 133
Section 8.12 Trustee May Enforce Claims Without Possession of Certificates.................... 133
Section 8.13 Suits for Enforcement............................................................ 133
Section 8.14 Waiver of Bond Requirement....................................................... 134
Section 8.15 Waiver of Inventory, Accounting and Appraisal Requirement........................ 134
Section 8.16 Compliance with National Housing Act of 1934..................................... 134
ARTICLE IX REMIC AND GRANTOR TRUST ADMINISTRATION.................................................... 134
Section 9.01 REMIC Administration............................................................. 134
Section 9.02 Prohibited Transactions and Activities........................................... 137
Section 9.03 Indemnification with Respect to Certain Taxes and Loss of REMIC Status........... 138
Section 9.04 REO Property..................................................................... 138
Section 9.05 Grantor Trust Administration..................................................... 139
ARTICLE X TERMINATION............................................................................... 139
Section 10.01 Termination...................................................................... 139
Section 10.02 Additional Termination Requirements.............................................. 141
ARTICLE XI MISCELLANEOUS PROVISIONS.................................................................. 142
Section 11.01 Amendment........................................................................ 142
Section 11.02 Recordation of Agreement; Counterparts........................................... 143
Section 11.03 Limitation on Rights of Certificateholders....................................... 143
Section 11.04 Governing Law; Jurisdiction...................................................... 144
Section 11.05 Notices.......................................................................... 144
Section 11.06 Severability of Provisions....................................................... 145
Section 11.07 Article and Section References................................................... 145
Section 11.08 Notice to the Rating Agencies.................................................... 145
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TABLE OF CONTENTS
(continued)
PAGE
Section 11.09 Further Assurances............................................................... 146
Section 11.10 Section 11.10 Benefits of Agreement............................................ 146
Section 11.11 Acts of Certificateholders....................................................... 146
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EXHIBITS:
Exhibit A-1 Form of Class AV-1 Certificates
Exhibit A-2 Form of Class AF-1 Certificates
Exhibit A-3 Form of Class AF-2 Certificates
Exhibit A-4 Form of Class AF-3 Certificates
Exhibit A-5 Form of Class AF-4 Certificates
Exhibit B-1 Form of Class B-1 Certificates
Exhibit B-2 Form of Class B-2 Certificates
Exhibit B-3 Form of Class B-3 Certificates
Exhibit B-4-1 Form of Class B-4 Certificates (144A)
Exhibit B-4-2 Form of Class B-4 Certificates (Regulation S)
Exhibit C-1-1 Form of Class R Certificate
Exhibit C-1-2 Form of Class R-X Certificates
Exhibit C-2 Form of Class M-1 Certificates
Exhibit C-3 Form of Class M-2 Certificates
Exhibit C-4 Form of Class M-3 Certificates
Exhibit C-5 Form of Class X Certificates
Exhibit C-6 Form of Class N Certificates
Exhibit D-1 Mortgage Loan Schedule for Group I Mortgage Loans
Exhibit D-2 Mortgage Loan Schedule for Group II Mortgage Loans
Exhibit E Form of Request for Release of Documents
Exhibit F-1 Form of Trustee's Initial Certification
Exhibit F-2 Form of Trustee's Final Certification
Exhibit F-3 Form of Receipt of Mortgage Note
Exhibit G Mortgage Loan Purchase Agreement
Exhibit H Form of Lost Note Affidavit
Exhibit I Form of ERISA Representation
Exhibit J Form of Investment Letter
Exhibit K Form of Residual Certificate Transfer Affidavit
Exhibit L Form of Transferor Certificate
Exhibit M Monthly Information Provided by Servicer
Exhibit N Form of Certification
Exhibit O Form of Certification to be Provided by Trustee
Exhibit P [Reserved]
Exhibit Q Form of Power of Attorney
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This Pooling and Servicing Agreement is dated as of August 1, 2004 (the
"Agreement"), among ▇▇▇▇▇▇▇ ▇▇▇▇▇ MORTGAGE INVESTORS, INC., as depositor (the
"Depositor"), CREDIT-BASED ASSET SERVICING AND SECURITIZATION LLC, as seller
(the "Seller"), ▇▇▇▇▇▇ LOAN SERVICING LP, as servicer (the "Servicer") and U.S.
BANK NATIONAL ASSOCIATION, as trustee (the "Trustee").
PRELIMINARY STATEMENT
The Depositor intends to sell pass-through certificates (collectively, the
"Certificates"), to be issued hereunder in multiple Classes, which in the
aggregate will evidence the entire beneficial ownership interest in the Trust
Fund created hereunder. The Certificates will consist of sixteen Classes of
Certificates, designated as (i) the Class AV-1, Class AF-1, Class AF-2, Class
AF-3 and Class AF-4 Certificates, (ii) the Class M-1, Class M-2 and Class M-3
Certificates, (iii) the Class B-1, Class B-2, Class B-3 and Class B-4
Certificates, (iv) the Class N Certificates, (v) the Class X Certificates, (vi)
the Class R Certificates and the Class R-X Certificates.
As provided herein, the Trustee shall elect that the Trust Fund (other
than the Grantor Trust) be treated for federal income tax purposes as nine
separate real estate mortgage investment conduits (each a "REMIC" or, in the
alternative, "REMIC 1," "REMIC 2," "REMIC 3," "REMIC 4," "REMIC 5," "REMIC 6,"
"REMIC 7," "REMIC 8" and "REMIC 9" respectively). The REMIC 9 Regular Interests
represent all of the "regular interests" in REMIC 9. The REMIC 8 Regular
Interests represent all of the "regular interests" in REMIC 8. The REMIC 7
Regular Interests represent all of the "regular interests" in REMIC 7. The REMIC
6 Regular Interests represent all of the "regular interests" in REMIC 6. The
REMIC 5 Regular Interests represent all of the "regular interests" in REMIC 5.
The REMIC 4 Regular Interests represent all of the "regular interests" in REMIC
4. The REMIC 3 Regular Interests represent all of the "regular interests" in
REMIC 3. The REMIC 2 Regular Interests represent all of the "regular interests"
in REMIC 2. The REMIC 1 Regular Interests represent all of the "regular
interests" in REMIC 1. Each Class of Cap Carryover Certificates (other than the
Class M-3, Class B-1, Class B-2, Class B-3 and Class B-4 Certificates)
represents beneficial ownership of the Corresponding REMIC 2 Regular Interest
and the right to receive LIBOR Carryover Amounts. The Class M-3 Certificates
represent beneficial ownership of the REMIC 4 Regular Interest and the right to
receive LIBOR Carryover Amounts. The Class B-1 Certificates represent beneficial
ownership of the REMIC 5 Regular Interest and the right to receive LIBOR
Carryover Amounts. The Class B-2 Certificates represent beneficial ownership of
the REMIC 6 Regular Interest and the right to receive LIBOR Carryover Amounts.
The Class B-3 Certificates represent beneficial ownership of the REMIC 7 Regular
Interest and the right to receive LIBOR Carryover Amounts. The Class B-4
Certificates represent beneficial ownership of the REMIC 8 Regular Interest and
the right to receive LIBOR Carryover Amounts. For federal income tax purposes,
the Class N and Class X Certificates together represent beneficial ownership of
the REMIC 9 X/N Interest subject to the obligation to pay LIBOR Carryover
Amounts. Each of the Class R-1 and Class R-2 Interests, represented collectively
by the Class R Certificates, represents the sole Class of "residual interest" in
REMIC 1 and REMIC 2, respectively, for purposes of the REMIC Provisions. Each of
the Class R-3, Class R-4, Class R-5, Class R-6, Class R-7, Class R-8 and Class
R-9 Interests, represented collectively by the Class R-X Certificates, represent
the sole Class of "residual interest" in REMIC 3, REMIC 4, REMIC 5, REMIC 6,
REMIC 7,
REMIC 8 and REMIC 9, respectively, for purposes of the REMIC provisions. The
REMIC 1 Regular Interests will be held as assets of REMIC 2. The REMIC 2 X/N
Interest will be held as the sole asset of REMIC 9. For federal income tax
purposes, the REMIC 9 X/N Interest will be held as the asset of the Grantor
Trust. The REMIC 2 AF-3 Interest will be held as the sole asset of REMIC 3. The
REMIC 2 M-3 Interest will be held as the sole asset of REMIC 4. The REMIC 2 B-1
Interest will be held as the sole asset of REMIC 5. The REMIC 2 B-2 Interest
will be held as the sole asset of REMIC 6. The REMIC 2 B-3 Interest will be held
as the sole asset of REMIC 7. The REMIC 2 B-4 Interest will be held as the sole
asset of REMIC 8. The "latest possible maturity date" for federal income tax
purposes of all interests created hereby will be the Distribution Date on August
25, 2034.
REMIC 1
The following table specifies the class designation, interest rate, and
initial principal amount for each class of REMIC 3 Interests.
Related Loan
Group or Related
Designation Interest Rate Initial Principal Amount Certificate
----------- ------------- ------------------------ ----------------
LT1-AV1 (1) $ 58,736,250.000000 Class AV-1
LT1-AF1 (1) $ 17,533,000.000000 Class AF-1
LT1-AF2 (1) $ 8,208,750.000000 Class AF-2
LT1-AF3 (1) $ 5,772,250.000000 Class AF-3
LT1-AF4 (1) $ 3,501,500.000000 Class AF-4
LT1-M1 (1) $ 5,741,000.000000 Class M-1
LT1-M2 (1) $ 4,879,750.000000 Class M-2
LT1-M3 (1) $ 1,722,250.000000 Class M-3
LT1-B1 (1) $ 1,148,000.000000 Class B-1
LT1-B2 (1) $ 1,148,000.000000 Class B-2
LT1-B3 (1) $ 1,148,000.000000 Class B-3
LT1-B4 (1) $ 2,296,250.000000 Class B-4
LT1-X1 (1) $117,808,269.985000 N/A
LT1-IA (1) $ 26,400.989005 Loan Group I
LT1-IB (2) $ 143,873.489005 Loan Group I
LT1-IIA (1) $ 15,738.780980 Loan Group II
LT1-IIB (3) $ 85,769.780980 Loan Group II
LT1-X2 (1) $229,371,486.945030 N/A
R-1 (4) (4) N/A
----------
(1) For any Distribution Date, the interest rate for these interests
shall be the Net Rate.
(2) For any Distribution Date, the interest rate for the LT1-IB Interest
shall be a per annum rate equal to the Group I Net Rate.
(3) For any Distribution Date, the interest rate for the LT1-IIB
Interest shall be a per annum rate equal to the Group II Net Rate
Cap.
(4) The Class R-1 Interest shall represent the sole class of residual
interest in REMIC 1. The Class R-1
2
Interest will not have a principal amount or an interest rate. The
Class R-1 Interest shall be represented by the Class R Certificate.
All computations with respect to any REMIC 1 Interest shall be taken out
to ten decimal places.
REMIC 2
The sole assets of REMIC 2 shall be the REMIC 1 Regular Interests. The
regular interests in REMIC 2 shall be the REMIC 2 Regular Interests. The
residual interest in REMIC 2 will be the Class R-2 Interest, which will be
represented by the Class R Certificate.
REMIC 3
The sole asset of REMIC 3 shall be the REMIC 2 AF-3 Interest. The sole
regular interest in REMIC 3 will be the Class AF-3 Certificates. The residual
interest in REMIC 3 will be the Class R-3 Interest, which will be represented by
the Class R-X Certificate.
REMIC 4
The sole asset of REMIC 4 shall be the REMIC 2 M-3 Interest. The sole
regular interest in REMIC 4 will be the REMIC 4 M-3 Interest. The residual
interest in REMIC 4 will be the Class R-4 Interest, which will be represented by
the Class R-X Certificate.
REMIC 5
The sole asset of REMIC 5 shall be the REMIC 2 B-1 Interest. The sole
regular interest in REMIC 5 will be the REMIC 5 B-1 Interest. The residual
interest in REMIC 5 will be the Class R-5 Interest, which will be represented by
the Class R-X Certificate.
REMIC 6
The sole asset of REMIC 6 shall be the REMIC 2 B-2 Interest. The sole
regular interest in REMIC 6 will be the REMIC 6 B-2 Interest. The residual
interest in REMIC 6 will be the Class R-6 Interest, which will be represented by
the Class R-X Certificate.
REMIC 7
The sole asset of REMIC 7 shall be the REMIC 2 B-3 Interest. The sole
regular interest in REMIC 7 will be the REMIC 7 B-3 Interest. The residual
interest in REMIC 7 will be the Class R-7 Interest, which will be represented by
the Class R-X Certificate.
REMIC 8
The sole asset of REMIC 8 shall be the REMIC 2 B-4 Interest. The sole
regular interest in REMIC 8 will be the REMIC 8 B-4 Interest. The residual
interest in REMIC 8 will be the Class R-8 Interest, which will be represented by
the Class R-X Certificate.
3
REMIC 9
The sole asset of REMIC 9 shall be the REMIC 2 X/N Interest. The sole
regular interest in REMIC 9 will be the REMIC 9 X/N Interest. The residual
interest in REMIC 9 will be the Class R-9 Interest, which will be represented by
the Class R-X Certificate.
The following table sets forth (or describes) the Class designation,
Pass-Through Rate and Original Class Certificate Principal Balance or Original
Notional Amount, for each Class of Certificates comprising the interests in the
Trust Fund created hereunder:
Original Class
Certificate
Principal Balance or Pass-Through Assumed Final
Class Notional Amount Rate Maturity Dates
----- -------------------- ------------ --------------
AV-1 $234,945,000 (1) July 25, 2035
AF-1 $ 70,132,000 (2) July 25, 2035
AF-2 $ 32,835,000 (3) July 25, 2035
AF-3 $ 23,089,000 (4) July 25, 2035
AF-4 $ 14,006,000 (5) July 25, 2035
M-1 $ 22,964,000 (6) July 25, 2035
M-2 $ 19,519,000 (7) July 25, 2035
M-3 $ 6,889,000 (8) July 25, 2035
B-1 $ 4,592,000 (9) July 25, 2035
B-2 $ 4,592,000 (10) July 25, 2035
B-3 $ 4,592,000 (11) July 25, 2035
B-4 $ 9,185,000 (12) July 25, 2035
N $ 19,000,000 (13) 8.00% N/A
X N/A (13) ▇/▇ ▇/▇
▇ ▇/▇ ▇/▇ ▇/▇
▇ -▇ ▇/▇ ▇/▇ ▇/▇
Total $447,340,000 (14)
(1) Interest will accrue on the Class AV-1 Certificates during each Interest
Accrual Period at a rate equal to the least of: (i) the Class AV-1
Pass-Through Rate, (ii) the Group I Available Funds Cap for such
Distribution Date and the Group I Maximum Rate Cap.
(2) Interest will accrue on the Class AF-1 Certificates at a rate equal to the
lesser of: (i) the Class AF-1 Pass-Through Rate and (ii) the Group II Net
Rate Cap for such Distribution Date.
(3) Interest will accrue on the Class AF-2 Certificates at a rate equal to the
lesser of: (i) the Class AF-2 Pass-Through Rate and (ii) the Group II Net
Rate Cap for such Distribution Date.
(4) Interest will accrue on the Class AF-3 Certificates at a rate equal to the
lesser of: (i) the Class AF-3 Pass-Through Rate and (ii) the Group II Net
Rate Cap for such Distribution Date.
(5) Interest will accrue on the Class AF-4 Certificates at a rate equal to the
lesser of (i) the Class AF-4 Pass-Through Rate and (ii) the Group II Net
Rate Cap for such Distribution Date.
(6) Interest will accrue on the Class M-1 Certificates at a rate equal to the
least of: (i) the Class M-1 Pass-Through Rate, (ii) the Subordinate Rate
Cap for such Distribution Date and (iii) the Subordinate Maximum Rate Cap.
(7) Interest will accrue on the Class M-2 Certificates at a rate equal to the
least of: (i) the Class M-2 Pass-Through Rate, (ii) the Subordinate Rate
Cap for such Distribution Date and (iii) the Subordinate Maximum Rate Cap.
4
(8) Interest will accrue on the Class M-3 Certificates at a rate equal to the
least of: (i) the Class M-3 Pass-Through Rate, (ii) the Subordinate Rate
Cap for such Distribution Date and (iii) the Subordinate Maximum Rate Cap.
(9) Interest will accrue on the Class B-1 Certificates at a rate equal to the
least of: (i) the Class B-1 Pass-Through Rate, (ii) the Subordinate Rate
Cap for such Distribution Date and (iii) the Subordinate Maximum Rate Cap.
(10) Interest will accrue on the Class B-2 Certificates at a rate equal to the
least of: (i) the Class B-2 Pass-Through Rate, (ii) the Subordinate Rate
Cap for such Distribution Date and (iii) the Subordinate Maximum Rate Cap.
(11) Interest will accrue on the Class B-3 Certificates at a rate equal to the
least of: (i) the Class B-3 Pass-Through Rate, (ii) the Subordinate Rate
Cap for such Distribution Date and (iii) the Subordinate Maximum Rate Cap.
(12) Interest will accrue on the Class B-4 Certificates at a rate equal to the
least of: (i) the Class B-4 Pass-Through Rate, (ii) the Subordinate Rate
Cap for such Distribution Date and (iii) the Subordinate Maximum Rate Cap.
(13) The Class N and Class X Certificates, collectively, represent the
beneficial ownership of the REMIC 9 X/N Interest, subject to the
obligation to make payments in respect of LIBOR Carryover Amounts.
(14) Exclusive of the Class N Notional Amount. The Class N Original Notional
Amount is $19,000,000.00.
ARTICLE I
DEFINITIONS
Section 1.01 Defined Terms.
Whenever used in this Agreement or in the Preliminary Statement, the
following words and phrases, unless the context otherwise requires, shall have
the meanings specified in this Article. Unless otherwise specified, interest on
the Class AV-1, Class AF-1, Class M-1, Class M-2, Class M-3, Class B-1, Class
B-2 and Class B-3 Certificates will be calculated on the basis of the actual
number of days in the related Interest Accrual Period and a 360-day year.
Interest on the Class AF-2, Class AF-3, Class AF-4, Class B-4, Class N and Class
X Certificates and the REMIC 1 Regular Interests and the REMIC 2 X/N Interest
will be calculated on the basis of a 360-day year consisting of twelve 30-day
months.
"1933 Act": The Securities Act of 1933, as amended.
"60+ Day Delinquent Loan": With respect to any date of determination, each
Mortgage Loan with respect to which any portion of a Monthly Payment is, as of
the last day of the prior Collection Period, two months or more past due, each
Mortgage Loan in foreclosure, all REO Property and each Mortgage Loan for which
the Mortgagor has filed for bankruptcy after the Closing Date.
"Account": Any of the Collection Account, the Distribution Account and the
Escrow Account.
"Accrued Certificate Interest": With respect to each Distribution Date and
Class of Certificates, an amount equal to the interest accrued at the applicable
rate set forth or described for such Class in the table in the Preliminary
Statement during the related Interest Accrual Period on the Certificate
Principal Balance or Notional Amount of such Class of Certificates, reduced by
such Class's Interest Percentage of Relief Act Interest Shortfalls for such
Distribution Date.
5
"Actuarial Mortgage Loan": Any Mortgage Loan other than a Simple Interest
Mortgage Loan.
"Adjustment Date": With respect to each Group I Mortgage Loan, each
adjustment date, on which the Mortgage Interest Rate of a Group I Mortgage Loan
changes pursuant to the related Mortgage Note. The first Adjustment Date
following the Cut-off Date as to each Group I Mortgage Loan is set forth in the
Mortgage Loan Schedule for the Group I Mortgage Loans.
"Adjustment Period": As defined in the Preliminary Statement.
"Advance": As to any Actuarial Mortgage Loan or REO Property, any advance
made by the Servicer in respect of any Distribution Date pursuant to Section
4.07.
"Advance Facility": As defined in Section 3.30(a) hereof.
"Advance Facility Notice": As defined in Section 3.30(b) hereof.
"Advance Financing Person": As defined in Section 3.30(a) hereof.
"Advance Reimbursement Amounts": As defined in Section 3.30(b) hereof.
"Adverse REMIC Event": As defined in Section 9.01(f) hereof.
"Affiliate": With respect to any Person, any other Person controlling,
controlled by or under common control with such Person. For purposes of this
definition, "control" means the power to direct the management and policies of a
Person, directly or indirectly, whether through ownership of voting securities,
by contract or otherwise and "controlling" and "controlled" shall have meanings
correlative to the foregoing.
"Agreement": This Pooling and Servicing Agreement and all amendments and
supplements hereto.
"Applicable Regulations": As to any Mortgage Loan, all federal, state and
local laws, statutes, rules and regulations applicable thereto, including with
respect to each FHA Loan, the FHA Regulations and the related FHA Insurance
Contract and with respect to each VA Loan, the VA Regulations and the related VA
Guaranty.
"Applied Realized Loss Amount": With respect to each Distribution Date,
the excess, if any, of (a) the aggregate of the Certificate Principal Balances
of the Certificates (after giving effect to all distributions on such
Distribution Date) over (b) the Pool Balance as of the end of the related
Collection Period.
"Assignment": An assignment of Mortgage, notice of transfer or equivalent
instrument, in recordable form, which is sufficient under the laws of the
jurisdiction wherein the related Mortgaged Property is located to reflect or
record the sale of the Mortgage.
"Assumed Final Maturity Date": As to each Class of Certificates, the date
set forth as such in the Preliminary Statement.
6
"Available Funds": As to any Distribution Date, an amount equal to the
excess of (i) the sum of (a) the aggregate of the Monthly Payments due during
the related Collection Period and received by the Servicer on or prior to the
related Determination Date, (b) Liquidation Proceeds, Insurance Proceeds,
Condemnation Proceeds, Principal Prepayments, Substitution Adjustment Amounts,
the Purchase Price for any repurchased Mortgage Loan, the Termination Price with
respect to the termination of the Trust pursuant to Section 10.01 hereof, any
Reimbursement Amount or Subsequent Recovery deposited to the Collection Account
and other unscheduled recoveries of principal and interest (excluding prepayment
penalties) in respect of the Mortgage Loans during the related Prepayment
Period, (c) the aggregate of any amounts received in respect of an REO Property
withdrawn from any REO Account and deposited in the Collection Account for such
Distribution Date, (d) any Compensating Interest for such Distribution Date, and
(e) the aggregate of any Advances made by the Servicer for such Distribution
Date over (ii) the sum of (a) amounts reimbursable or payable to the Servicer
pursuant to Section 3.05, (b) Stayed Funds, (c) the Servicing Fee and (d)
amounts deposited in the Collection Account or the Distribution Account, as the
case may be, in error.
"Balloon Mortgage Loan": A Mortgage Loan that provides for the payment of
the unamortized principal balance of such Mortgage Loan in a single payment at
the maturity of such Mortgage Loan that is substantially greater than the
preceding monthly payment.
"Balloon Payment": A payment of the unamortized principal balance of a
Mortgage Loan in a single payment at the maturity of such Mortgage Loan that is
substantially greater than the preceding Monthly Payment.
"Bankruptcy Code": Title 11 of the United States Code, as amended.
"Book-Entry Certificates": Any of the Certificates that shall be
registered in the name of the Depository or its nominee, the ownership of which
is reflected on the books of the Depository or on the books of a Person
maintaining an account with the Depository (directly, as a "Depository
Participant," or indirectly, as an indirect participant in accordance with the
rules of the Depository and as described in Section 5.02 hereof). On the Closing
Date, the Class AV-1, Class AF-1, Class AF-2, Class AF-3, Class AF-4, Class M-1,
Class M-2, Class M-3, Class B-1, Class B-2, Class B-3 and Class B-4 Certificates
shall be Book-Entry Certificates.
"Book-Entry Regulation S Global Securities": As defined in Section 5.01.
"Business Day": Any day other than a Saturday, a Sunday or a day on which
banking institutions in the State of Delaware, the State of New York, the State
of 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.
"Cap": Any of the Group I Available Funds Cap, the Group II Net Rate Cap,
the Group I Maximum Rate Cap, the Subordinate Rate Cap or the Subordinate
Maximum Rate Cap.
"Cap Carryover Certificates": The Class AV-1, Class M-1, Class M-2, Class
M-3, Class B-1, Class B-2, Class B-3 and Class B-4 Certificates.
"Certificate": Any Regular Certificate or Residual Certificate.
7
"Certificate Custodian": Initially, U.S. Bank National Association;
thereafter any other Certificate Custodian acceptable to the Depository and
selected by the Trustee.
"Certificate Insurance Policy": The Financial Guaranty Insurance Policy
No. CA01172A, and all endorsements thereto dated the Closing Date, issued by the
Certificate Insurer for the benefit of the Class AF-3 Certificateholders.
"Certificate Insurer": XL Capital Assurance Inc., a New York monoline
insurance corporation or its successors in interest.
"Certificate Insurer Default": The occurrence and continuance of any of
the following:
(a) the Certificate Insurer shall have failed to make a required
payment when due under the Certificate Insurance Policy in accordance with its
terms;
(b) the Certificate Insurer shall have (i) filed a petition or
commenced any case or proceeding under any provision or chapter of the United
States Bankruptcy Code, the New York State Insurance Law or any other similar
federal or state law relating to insolvency, bankruptcy, rehabilitation,
liquidation, or reorganization, (ii) made a general assignment for the benefit
of its creditors or (iii) had an order for relief entered against it under the
United States Bankruptcy Code, the New York State Insurance Law or any other
similar federal or state law relating to insolvency, bankruptcy, rehabilitation,
liquidation, or reorganization that is final and nonappealable; or
(c) a court of competent jurisdiction, the New York Department of
Insurance or any other competent regulatory authority shall have entered a final
and nonappealable order, judgment or decree (i) appointing a custodian, trustee,
agent, or receiver for the Certificate Insurer or for all or any material
portion of its property or (ii) authorizing the taking of possession by a
custodian, trustee, agent, or receiver of the Certificate Insurer (or the taking
of possession of all or any material portion of property of the Certificate
Insurer).
"Certificate Owner": With respect to each Book-Entry Certificate, any
beneficial owner thereof.
"Certificate Principal Balance": With respect to any Class of Certificates
(other than the Class N, Class X and Residual Certificates) and any Distribution
Date, the Original Class Certificate Principal Balance reduced by the sum of (i)
all amounts actually distributed in respect of principal of such Class on all
prior Distribution Dates and (ii) Applied Realized Loss Amounts allocated
thereto. The Class N, Class X and Residual Certificates do not have a
Certificate Principal Balance. With respect to any Certificate (other than a
Class X, Class N or a Residual Certificate) of a Class and any Distribution
Date, the portion of the Certificate Principal Balance of such Class represented
by such Certificate equal to the product of the Percentage Interest evidenced by
such Certificate and the Certificate Principal Balance of such Class.
Notwithstanding the foregoing on any Distribution Date relating to a Collection
Period in which a Subsequent Recovery has been received by the Servicer, the
Certificate Principal Balance of any Class of Certificates then outstanding for
which any Applied Realized Loss Amount has been allocated will be increased, in
order of seniority, by an amount equal to the lesser of (i) the Unpaid Realized
Loss Amount for such Class of Certificates and (ii) the amount of any
8
Subsequent Recovery allocable to principal distributed on such date to the
Certificateholders (reduced by the amount of the increase in the Certificate
Principal Balance of any more senior Class of Certificates pursuant to this
sentence on such Distribution Date).
"Certificate Register" and "Certificate Registrar": The register
maintained and registrar appointed pursuant to Section 5.02 hereof.
"Certificateholder" or "Holder": The Person in whose name a Certificate is
registered in the Certificate Register, except that a Disqualified Organization
or Disqualified Non-U.S. Person shall not be a Holder of a Residual Certificate
for any purpose hereof.
"Class": Collectively, Certificates or REMIC Regular Interests which have
the same priority of payment and bear the same class designation and the form of
which is identical except for variation in the Percentage Interest evidenced
thereby.
"Class AF-1 Certificate Margin": For each Distribution Date (i) on or
prior to the Optional Termination Date, 0.190% per annum, and (ii) following the
Optional Termination Date, 0.380% per annum.
"Class AF-1 Pass-Through Rate": For each Distribution Date, the lesser of
(i) LIBOR as of the related LIBOR Determination Date, plus the Class AF-1
Certificate Margin and (ii) the Group II Net Rate Cap.
"Class AF-2 Pass-Through Rate": For each Distribution Date (i) on or prior
to the Optional Termination Date, 4.062% per annum, and (ii) following the
Optional Termination Date, 4.562% per annum, subject in either case to a cap
equal to the Group II Net Rate Cap.
"Class AF-3 Pass-Through Rate": For each Distribution Date (i) on or prior
to the Optional Termination Date, 5.135% per annum, and (ii) following the
Optional Termination Date, 5.635% per annum, subject in either case to a cap
equal to the Group II Net Rate Cap.
"Class AF-4 Lockout Distribution Amount": For any Distribution Date, the
product of (x) the Class AF-4 Lockout Distribution Percentage and (y) the Class
AF-4 Pro Rata Distribution Amount. In no event shall the Class AF-4 Lockout
Distribution Amount for a Distribution Date exceed the Group II Principal
Distribution Amount for such Distribution Date or the Certificate Principal
Balance of the Class AF-4 Certificates immediately prior to such Distribution
Date.
"Class AF-4 Pro Rata Distribution Amount" means, for any Distribution
Date, an amount equal to the product of (x) a fraction, the numerator of which
is the Certificate Principal Balance of the Class AF-4 Certificates immediately
prior to such Distribution Date and the denominator of which is the aggregate
Certificate Principal Balance of the Class AF-1, Class AF-2, Class AF-3 and
Class AF-4 Certificates immediately prior to that Distribution Date and (y) the
Group II Principal Distribution Amount for that Distribution Date.
9
"Class AF-4 Lockout Percentage" means, for a Distribution Date in any
period listed in the table below, the applicable percentage listed opposite such
period:
Distribution Dates Lockout Percentage
------------------------------------------------ ------------------
September 2004 through and including August 2007 0%
September 2007 through and including August 2009 45%
September 2009 through and including August 2010 80%
September 2010 through and including August 2011 100%
September 2011 and thereafter 300%
"Class AF-4 Pass-Through Rate": For each Distribution Date, (i) on or
prior to the Optional Termination Date, 4.764% per annum, and (ii) following the
Optional Termination Date, 5.264% per annum, subject in each case to a cap equal
to the Group II Net Rate Cap.
"Class AV-1 Certificate Margin": For each Distribution Date (i) on or
prior to the Optional Termination Date, 0.330% per annum, and (ii) following the
Optional Termination Date, 0.660% per annum.
"Class AV-1 Pass-Through Rate": For each Distribution Date, the least of
(i) LIBOR as of the related LIBOR Determination Date, plus the Class AV-1
Certificate Margin, (ii) the Group I Available Funds Cap and (iii) the Group I
Maximum Rate Cap.
"Class A Certificate": Any one of the Certificates with an "A" designated
on the face thereof substantially in the form annexed hereto as Exhibits ▇-▇,
▇-▇, ▇-▇, ▇-▇ and A-5, executed by the Trustee on behalf of the Trust and
authenticated and delivered by the Certificate Registrar, representing the right
to distributions as set forth herein and therein.
"Class A Certificateholders": Collectively, the Holders of the Class A
Certificates.
"Class A Interest Carry Forward Amount": For any Distribution Date, the
sum of the Interest Carry Forward Amounts for the Class A Certificates for such
Distribution Date.
"Class A Principal Distribution Amount": As of any Distribution Date (a)
prior to the Stepdown Date or with respect to which a Trigger Event is in
effect, the Principal Distribution Amount and (b) on or after the Stepdown Date
and as long as a Trigger Event is not in effect, the excess of (x) the sum of
the Certificate Principal Balances of the Class A Certificates immediately prior
to such Distribution Date over (y) the lesser of (A) the product of (i) 63.30%
and (ii) the Pool Balance as of the last day of the related Collection Period
and (B) the Pool Balance as of the last day of the related Collection Period
minus the product of 0.50% and the Pool Balance on the Cut-off Date.
10
"Class B Certificate": Any one of the Certificates with a "B" designated
on the face thereof substantially in the form annexed hereto as Exhibits ▇-▇,
▇-▇, ▇-▇ and B-4, executed by the Trustee on behalf of the Trust and
authenticated and delivered by the Certificate Registrar, representing the right
to distributions as set forth herein and therein.
"Class B Certificateholders": Collectively, the Holders of the Class B
Certificates.
"Class B-1 Applied Realized Loss Amount": As to the Class B-1 Certificates
and as of any Distribution Date, the lesser of (x) the Certificate Principal
Balance thereof (after taking into account the distribution of the Principal
Distribution Amount on such Distribution Date, but prior to the application of
the Class B-1 Applied Realized Loss Amount, if any, on such Distribution Date)
and (y) the excess of (i) the Applied Realized Loss Amount as of such
Distribution Date over (ii) the sum of the Class B-2 Applied Realized Loss
Amount, the Class B-3 Applied Realized Loss Amount and the Class B-4 Applied
Realized Loss Amount, in each case as of such Distribution Date.
"Class B-1 Certificate Margin": For each Distribution Date (i) on or prior
to the Optional Termination Date, 1.800% per annum, and (ii) following the
Optional Termination Date, 2.700% per annum.
"Class B-1 Pass-Through Rate": For each Distribution Date, the least of
(i) LIBOR as of the related LIBOR Determination Date, plus the Class B-1
Certificate Margin, (ii) the Subordinate Rate Cap and (iii) the Subordinate
Maximum Rate Cap.
"Class B-1 Principal Distribution Amount": As of any Distribution Date on
or after the Stepdown Date and as long as a Trigger Event is not in effect, the
excess of (x) the sum of (i) the sum of the Certificate Principal Balances 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 B-1 Certificates immediately prior to such
Distribution Date over (y) the lesser of (A) the product of (i) 86.80% and (ii)
the Pool Balance as of the last day of the related Collection Period and (B) the
Pool Balance as of the last day of the related Collection Period minus the
product of 0.50% and the Pool Balance on the Cut-off Date.
"Class B-1 Realized Loss Amortization Amount": As to the Class B-1
Certificates and as of any Distribution Date, the lesser of (x) the Unpaid
Realized Loss Amount for the Class B-1 Certificates as of such Distribution Date
and (y) the excess of (i) the Monthly Excess Cashflow Amount over (ii) the sum
of the amounts described in Section 4.02(b)(i) through (xiv) hereof, in each
case for such Distribution Date.
"Class B-2 Applied Realized Loss Amount": As to the Class B-2 Certificates
and as of any Distribution Date, the lesser of (x) the Certificate Principal
Balance thereof (after taking into
11
account the distribution of the Principal Distribution Amount on such
Distribution Date, but prior to the application of the Class B-2 Applied
Realized Loss Amount, if any, on such Distribution Date) and (y) the excess of
(i) the Applied Realized Loss Amount as of such Distribution Date over (ii) the
sum of the Class B-3 Applied Realized Loss Amount and the Class B-4 Applied
Realized Loss Amount, in each case as of such Distribution Date.
"Class B-2 Certificate Margin": For each Distribution Date (i) on or prior
to the Optional Termination Date, 1.900% per annum, and (ii) following the
Optional Termination Date, 2.850% per annum.
"Class B-2 Pass-Through Rate": For each Distribution Date, the least of
(i) LIBOR as of the related LIBOR Determination Date, plus the Class B-2
Certificate Margin, (ii) the Subordinate Rate Cap and (iii) the Subordinate
Maximum Rate Cap.
"Class B-2 Principal Distribution Amount": As of any Distribution Date on
or after the Stepdown Date and as long as a Trigger Event is not in effect, the
excess of (x) the sum of (i) the sum of the Certificate Principal Balances 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 B-1 Certificates (after taking into account the
payment of the Class B-1 Principal Distribution Amount on such Distribution
Date) and (vi) the Certificate Principal Balance of the Class B-2 Certificates
immediately prior to such Distribution Date over (y) the lesser of (A) the
product of (i) 88.80% and (ii) the Pool Balance as of the last day of the
related Collection Period and (B) the Pool Balance as of the last day of the
related Collection Period minus the product of 0.50% and the Pool Balance on the
Cut-off Date.
"Class B-2 Realized Loss Amortization Amount": As to the Class B-2
Certificates and as of any Distribution Date, the lesser of (x) the Unpaid
Realized Loss Amount for the Class B-2 Certificates as of such Distribution Date
and (y) the excess of (i) the Monthly Excess Cashflow Amount over (ii) the sum
of the amounts described in Section 4.02(b)(i) through (xvii) hereof, in each
case for such Distribution Date.
"Class B-3 Applied Realized Loss Amount": As to the Class B-3 Certificates
and as of any Distribution Date, the lesser of (x) the Certificate Principal
Balance thereof (after taking into account the distribution of the Principal
Distribution Amount on such Distribution Date, but prior to the application of
the Class B-3 Applied Realized Loss Amount, if any, on such Distribution Date)
and (y) the excess of (i) the Applied Realized Loss Amount as of such
Distribution Date over (ii) the Class B-4 Applied Realized Loss Amount as of
such Distribution Date.
"Class B-3 Certificate Margin": For each Distribution Date (i) on or prior
to the Optional Termination Date, 2.000% per annum, and (ii) following the
Optional Termination Date, 3.000% per annum.
12
"Class B-3 Pass-Through Rate": For each Distribution Date, the least of
(i) LIBOR as of the related LIBOR Determination Date, plus the Class B-3
Certificate Margin, (ii) the Subordinate Rate Cap and (iii) the Subordinate
Maximum Rate Cap.
"Class B-3 Principal Distribution Amount": As of any Distribution Date on
or after the Stepdown Date and as long as a Trigger Event is not in effect, the
excess of (x) the sum of (i) the sum of the Certificate Principal Balances 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 B-1 Certificates (after taking into account the
payment of the Class B-1 Principal Distribution Amount on such Distribution
Date), (vi) the Certificate Principal Balance of the Class B-2 Certificates
(after taking into account the payment of the Class B-2 Principal Distribution
Amount on such Distribution Date) and (vii) the Certificate Principal Balance of
the Class B-3 Certificates immediately prior to such Distribution Date over (y)
the lesser of (A) the product of (i) 90.80% and (ii) the Pool Balance as of the
last day of the related Collection Period and (B) the Pool Balance as of the
last day of the related Collection Period minus the product of 0.50% and the
Pool Balance on the Cut-off Date.
"Class B-3 Realized Loss Amortization Amount": As to the Class B-3
Certificates and as of any Distribution Date, the lesser of (x) the Unpaid
Realized Loss Amount for the Class B-3 Certificates as of such Distribution Date
and (y) the excess of (i) the Monthly Excess Cashflow Amount over (ii) the sum
of the amounts described in Section 4.02(b)(i) through (xx) hereof, in each case
for such Distribution Date.
"Class B-4 Applied Realized Loss Amount": As to the Class B-4 Certificates
and as of any Distribution Date, the lesser of (x) the Certificate Principal
Balance thereof (after taking into account the distribution of the Principal
Distribution Amount on such Distribution Date, but prior to the application of
the Class B-4 Applied Realized Loss Amount, if any, on such Distribution Date)
and (y) the Applied Realized Loss Amount as of such Distribution Date.
"Class B-4 Pass-Through Rate": For each Distribution Date, the least of
(i) (x) on or prior to the Optional Termination Date, 6.000% per annum, and (y)
following the Optional Termination Date, 6.500% per annum, (ii) the Subordinate
Rate Cap and (iii) the Subordinate Maximum Rate Cap.
"Class B-4 Principal Distribution Amount": As of any Distribution Date on
or after the Stepdown Date and as long as a Trigger Event is not in effect, the
excess of (x) the sum of (i) the sum of the Certificate Principal Balances 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
13
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 B-1
Certificates (after taking into account the payment of the Class B-1 Principal
Distribution Amount on such Distribution Date), (vi) the Certificate Principal
Balance of the Class B-2 Certificates (after taking into account the payment of
the Class B-2 Principal Distribution Amount on such Distribution Date), (vii)
the Certificate Principal Balance of the Class B-3 Certificates (after taking
into account the payment of the Class B-3 Principal Distribution Amount on such
Distribution Date) and (viii) the Certificate Principal Balance of the Class B-4
Certificates immediately prior to such Distribution Date over (y) the lesser of
(A) the product of (i) 94.80% and (ii) the Pool Balance as of the last day of
the related Collection Period and (B) the Pool Balance as of the last day of the
related Collection Period minus the product of 0.50% and the Pool Balance on the
Cut-off Date.
"Class B-4 Realized Loss Amortization Amount": As to the Class B-4
Certificates and as of any Distribution Date, the lesser of (x) the Unpaid
Realized Loss Amount for the Class B-4 Certificates as of such Distribution Date
and (y) the excess of (i) the Monthly Excess Cashflow Amount over (ii) the sum
of the amounts described in Section 4.02(b)(i) through (xxiii) hereof, in each
case for such Distribution Date.
"Class M Certificate": Any one of the Certificates with an "M" designated
on the face thereof substantially in the form annexed hereto as Exhibit C-2,
Exhibit C-3 and Exhibit C-4, executed by the Trustee on behalf of the Trust and
authenticated and delivered by the Certificate Registrar, representing the right
to distributions as set forth herein and therein.
"Class M Certificateholders": Collectively, the Holders of the Class M
Certificates.
"Class M-1 Applied Realized Loss Amount": As to the Class M-1 Certificates
and as of any Distribution Date, the lesser of (x) the Certificate Principal
Balance thereof (after taking into account the distribution of the Principal
Distribution Amount on such Distribution Date, but prior to the application of
the Class M-1 Applied Realized Loss Amount, if any, on such Distribution Date)
and (y) the excess of (i) the Applied Realized Loss Amount as of such
Distribution Date over (ii) the sum of the Class M-2 Applied Realized Loss
Amount, the Class M-3 Applied Realized Loss Amount, the Class B-1 Applied
Realized Loss Amount, the Class B-2 Applied Realized Loss Amount, the Class B-3
Applied Realized Loss Amount and the Class B-4 Applied Realized Loss Amount, in
each case as of such Distribution Date.
"Class M-1 Certificate Margin": For each Distribution Date (i) on or prior
to the Optional Termination Date, 0.600% per annum, and (ii) following the
Optional Termination Date, 0.900% per annum.
"Class M-1 Pass-Through Rate": For each Distribution Date, the least of
(i) LIBOR as of the related LIBOR Determination Date, plus the Class M-1
Certificate Margin, (ii) the Subordinate Rate Cap and (iii) the Subordinate
Maximum Rate Cap.
"Class M-1 Principal Distribution Amount": As of any Distribution Date on
or after the Stepdown Date and as long as a Trigger Event is not in effect, the
excess of (x) the sum of (i) the
14
Certificate Principal Balances 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) 73.30% and (ii) the Pool Balance as of the last day of
the related Collection Period and (B) the Pool Balance as of the last day of the
related Collection Period minus the product of 0.50% and the Pool Balance on the
Cut-off Date.
"Class M-1 Realized Loss Amortization Amount": As to the Class M-1
Certificates and as of any Distribution Date, the lesser of (x) the Unpaid
Realized Loss Amount for the Class M-1 Certificates as of such Distribution Date
and (y) the excess of (i) the Monthly Excess Cashflow Amount over (ii) the sum
of the amounts described in Section 4.02(b)(i) through (v) hereof, in each case
for such Distribution Date.
"Class M-2 Applied Realized Loss Amount": As to the Class M-2 Certificates
and as of any Distribution Date, the lesser of (x) the Certificate Principal
Balance thereof (after taking into account the distribution of the Principal
Distribution Amount on such Distribution Date, but prior to the application of
the Class M-2 Applied Realized Loss Amount, if any, on such Distribution Date)
and (y) the excess of (i) the related Applied Realized Loss Amount as of such
Distribution Date over (ii) the sum of the Class M-3 Applied Realized Loss
Amount, the Class B-1 Applied Realized Loss Amount, the Class B-2 Applied
Realized Loss Amount, the Class B-3 Applied Realized Loss Amount and the Class
B-4 Applied Realized Loss Amount, in each case as of such Distribution Date.
"Class M-2 Certificate Margin": For each Distribution Date (i) on or prior
to the Optional Termination Date, 1.150% per annum, and (ii) following the
Optional Termination Date, 1.725% per annum.
"Class M-2 Pass-Through Rate": For each Distribution Date, the least of
(i) LIBOR as of the related LIBOR Determination Date, plus the Class M-2
Certificate Margin, (ii) the Subordinate Rate Cap and (iii) the Subordinate
Maximum Rate Cap.
"Class M-2 Principal Distribution Amount": As of any Distribution Date on
or after the Stepdown Date and as long as a Trigger Event is not in effect, the
excess of (x) the sum of (i) the sum of the Certificate Principal Balances 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) 81.80% and (ii) the Pool Balance as of the last day of the
related Collection Period and (B) the Pool Balance as of the last day of the
related Collection Period minus the product of 0.50% and the Pool Balance on the
Cut-off Date.
"Class M-2 Realized Loss Amortization Amount": As to the Class M-2
Certificates and as of any Distribution Date, the lesser of (x) the Unpaid
Realized Loss Amount for the Class M-2 Certificates as of such Distribution Date
and (y) the excess of (i) the Monthly Excess Cashflow Amount over (ii) the sum
of the amounts described in Section 4.02(b)(i) through (viii) hereof, in each
case for such Distribution Date.
15
"Class M-3 Applied Realized Loss Amount": As to the Class M-3 Certificates
and as of any Distribution Date, the lesser of (x) the Certificate Principal
Balance thereof (after taking into account the distribution of the Principal
Distribution Amount on such Distribution Date, but prior to the application of
the Class M-3 Applied Realized Loss Amount, if any, on such Distribution Date)
and (y) the excess of (i) the related Applied Realized Loss Amount as of such
Distribution Date over (ii) the sum of the Class B-1 Applied Realized Loss
Amount, the Class B-2 Applied Realized Loss Amount, the Class B-3 Applied
Realized Loss Amount and the Class B-4 Applied Realized Loss Amount, in each
case as of such Distribution Date.
"Class M-3 Certificate Margin": For each Distribution Date (i) on or prior
to the Optional Termination Date, 1.400% per annum, and (ii) following the
Optional Termination Date, 2.100% per annum.
"Class M-3 Pass-Through Rate": For each Distribution Date, the least of
(i) LIBOR as of the related LIBOR Determination Date, plus the Class M-1
Certificate Margin, (ii) the Subordinate Rate Cap and (iii) the Subordinate
Maximum Rate Cap.
"Class M-3 Principal Distribution Amount": As of any Distribution Date on
or after the Stepdown Date and as long as a Trigger Event is not in effect, the
excess of (x) the sum of (i) the sum of the Certificate Principal Balances 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) 84.80% and (ii) the Pool Balance as of the
last day of the related Collection Period and (B) the Pool Balance as of the
last day of the related Collection Period minus the product of 0.50% and the
Pool Balance on the Cut-off Date.
"Class M-3 Realized Loss Amortization Amount": As to the Class M-3
Certificates and as of any Distribution Date, the lesser of (x) the Unpaid
Realized Loss Amount for the Class M-3 Certificates as of such Distribution Date
and (y) the excess of (i) the Monthly Excess Cashflow Amount over (ii) the sum
of the amounts described in Section 4.02(b)(i) through (xi) hereof, in each case
for such Distribution Date.
"Class N Certificate": Any one of the Certificates with an "N" designated
on the face thereof substantially in the form annexed hereto as Exhibit C-5,
executed by the Trustee on behalf of the Trust and authenticated and delivered
by the Certificate Registrar, representing the right to distributions as set
forth herein and therein.
"Class N Notional Amount": As of any date, the Notional Amount of the
Class N Certificates.
"Class R Certificate": The Class R Certificate executed by the Trustee on
behalf of the Trust, and authenticated and delivered by the Certificate
Registrar, substantially in the form annexed hereto as Exhibit C-1-1 and
evidencing the ownership of the Residual Interest in each of
16
REMIC 1 and REMIC 2. The Class R Certificate represents the ownership of the
Class R-1 Interest and Class R-2 Interest.
"Class R Excess Interest Amount": For any Distribution Date, 0.05% of the
Monthly Excess Interest Amount for such Distribution Date.
"Class R Excess Interest Carryforward Amount": For any Distribution Date,
the excess of the Class R Excess Interest Amount for all prior Distribution
Dates over all amounts previously distributed to the Class R Certificates in
respect of Class R Excess Interest Amounts or Class R Excess Interest
Carryforward Amounts.
"Class R-1 Interest": The uncertificated residual interest in REMIC 1.
"Class R-2 Interest": The uncertificated residual interest in REMIC 2.
"Class R-3 Interest": The uncertificated residual interest in REMIC 3.
"Class R-4 Interest": The uncertificated residual interest in REMIC 4.
"Class R-5 Interest": The uncertificated residual interest in REMIC 5.
"Class R-6 Interest": The uncertificated residual interest in REMIC 6.
"Class R-7 Interest": The uncertificated residual interest in REMIC 7.
"Class R-8 Interest": The uncertificated residual interest in REMIC 8.
"Class R-9 Interest": The uncertificated residual interest in REMIC 9.
"Class R-X Certificate": The Class R-X Certificate executed by the Trustee
on behalf of the Trust, and authenticated and delivered by the Certificate
Registrar, substantially in the form annexed hereto as Exhibit C-1-2 and
evidencing the ownership of the Residual Interest in each of REMIC 3, REMIC 4,
REMIC 5, REMIC 6, REMIC 7, REMIC 8 and REMIC 9. The Class R-X Certificate
represents the ownership of the Class R-3 Interest, Class R-4 Interest, Class
R-5 Interest, Class R-6 Interest, Class R-7 Interest, Class R-8 Interest and
Class R-9 Interest.
"Class X": Any one of the Class X Certificates as designated on the face
thereof substantially in the form annexed hereto as Exhibit C-4, executed by the
Trustee on behalf of the Trust and authenticated and delivered by the
Certificate Registrar, representing the right to distributions as set forth
herein and therein.
"Class X/N Interest": An uncertificated interest in the Trust held by the
Trustee on behalf of the holders of the Class X and Class N Certificates,
representing, for federal income tax purposes, ownership of the REMIC 9 Class
X/N Interest, and which is entitled to all distributions in respect of the REMIC
9 X/N Interest less the amount of any LIBOR Carryover Amounts paid pursuant to
Section 4.02(b)(xxvii) or (xxviii).
17
"Class X Distributable Amount": With respect to any Distribution Date, the
excess of (i) the aggregate of amounts distributable on the Class X/N Interest
for such Distribution Date, over (ii) the aggregate of amounts distributable to
the Class N Certificates pursuant to Section 4.02(b).
"Closing Date": September 9, 2004.
"Code": The Internal Revenue Code of 1986, as it may be amended from time
to time.
"Collection Account": The account or accounts created and maintained by
the Servicer pursuant to Section 3.04, which shall be entitled "Collection
Account, ▇▇▇▇▇▇ Loan Servicing LP, as Servicer for the Trust under the Pooling
and Servicing Agreement dated as of August 1, 2004 among ▇▇▇▇▇▇▇ ▇▇▇▇▇ Mortgage
Investors, Inc., as Depositor, Credit-Based Asset Servicing and Securitization
LLC, as Seller, ▇▇▇▇▇▇ Loan Servicing LP, as Servicer, and U.S. Bank National
Association, as Trustee, in trust for registered Holders of 2004-CB6 Trust,
C-BASS Mortgage Loan Asset-Backed Certificates, Series 2004-CB6," and which must
be an Eligible Account.
"Collection Period": With respect to any Distribution Date, the period
from the second day of the calendar month preceding the month in which such
Distribution Date occurs through the first day of the month in which such
Distribution Date occurs.
"Combined Loan-to-Value Ratio": As of any date and Mortgage Loan, the
fraction, expressed as a percentage, the numerator of which is the Principal
Balance of the Mortgage Loan as of the Cut-off Date plus the principal balance
of any related senior mortgage loan, if any, at origination of the Mortgage Loan
and the denominator of which is the Value of the related Mortgaged Property.
"Compensating Interest": As defined in Section 3.23 hereof.
"Condemnation Proceeds": All awards or settlements in respect of a taking
of a Mortgaged Property by exercise of the power of eminent domain or
condemnation.
"Conventional Mortgage Loan": Any Mortgage Loan that is not an FHA Loan or
VA Loan.
"Corporate Trust Office": With respect to the Trustee, (i) the principal
corporate trust office of the Trustee 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 ▇▇ ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇-▇▇-▇▇▇▇, ▇▇. ▇▇▇▇, ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇-▇▇▇▇,
Attention: Structured Finance, C-BASS 2004-CB6 and (ii) for purposes of
Certificate transfers, is located at ▇▇ ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇. ▇▇▇▇, ▇▇▇▇▇▇▇▇▇
▇▇▇▇▇-▇▇▇▇, Attention: Corporate Trust Services-Transfers, EP-MN-WS2N, or at
such other addresses as the Trustee may designate from time to time by notice to
the Certificateholders, the Depositor, the Servicer and the Seller.
"Corresponding Cap Carryover Certificate" and "Corresponding REMIC 2
Regular Interest": For any REMIC 2 Regular Interest set forth below, the
corresponding Cap Carryover Certificate set forth below, and for any Cap
Carryover Certificate set forth below, the corresponding REMIC 2 Regular
Interest set forth below:
18
Corresponding Cap Carryover Certificate Corresponding REMIC 2 Regular Interest
--------------------------------------- --------------------------------------
Class AV-1 Certificate REMIC 2 AV-1 Interest
Class M-1 Certificate REMIC 2 M-1 Interest
Class M-2 Certificate REMIC 2 M-2 Interest
Class M-3 Certificate REMIC 2 M-3 Interest
Class B-1 Certificate REMIC 2 B-1 Interest
Class B-2 Certificate REMIC 2 B-2 Interest
Class B-3 Certificate REMIC 2 B-3 Interest
Class B-4 Certificate REMIC 2 B-4 Interest
"Custodial Agreement": The Custodial Agreement, dated as of September 1,
2004, among the Trustee, the Servicer and the Custodian, as the same may be
amended or supplemented pursuant to the terms thereof.
"Custodian": The Bank of New York, a New York banking corporation, or any
successor custodian appointed pursuant to the terms of the Custodial Agreement.
"Cut-off Date": August 1, 2004.
"Cut-off Date Principal Balance": With respect to any Mortgage Loan, the
unpaid principal balance thereof as of the Cut-off Date after application of
funds received or advanced on or before such date (or as of the applicable date
of substitution with respect to an Eligible Substitute Mortgage Loan).
"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.
"Defective Mortgage Loan": A Mortgage Loan replaced or to be replaced by
one or more Eligible Substitute Mortgage Loans.
"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 5.02(c) hereof.
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"Delinquent": Any Mortgage Loan with respect to which the Monthly Payment
and/or any Escrow Payment due on a Due Date is not made by the close of business
on the next scheduled Due Date for such Mortgage Loan or any Mortgage Loan with
respect to which any Servicing Advances made on or before the Cut-off Date has
not been reimbursed by the related Mortgagor.
"Depositor": ▇▇▇▇▇▇▇ ▇▇▇▇▇ Mortgage Investors, Inc., a Delaware
corporation, or any successor in interest.
"Depository": The initial depository shall be The Depository Trust
Company, whose nominee is Cede & Co., or any other organization registered as a
"clearing agency" pursuant to Section 17A of the Securities Exchange Act of
1934, as amended. The Depository shall initially be the registered Holder of the
Book-Entry Certificates. The Depository shall at all times be a "clearing
corporation" as defined in Section 8-102(3) of the Uniform Commercial Code of
the State of New York.
"Depository Participant": A broker, dealer, bank or other financial
institution or other person for whom from time to time a Depository effects
book-entry transfers and pledges of securities deposited with the Depository.
"Determination Date": With respect to any Distribution Date, the 10th day
of the calendar month in which such Distribution Date occurs or, if such 10th
day is not a Business Day, the Business Day immediately preceding such 10th 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 the Trust other than through an
Independent Contractor; provided, however, that the Trustee (or the Servicer
under this Agreement) shall not be considered to Directly Operate an REO
Property solely because the Trustee (or the Servicer under this Agreement)
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 Non-U.S. Person": With respect to a Residual Certificate,
any (A) non-U.S. Person or agent thereof or (B) U.S. Person with respect to whom
income from a Residual Certificate is attributable to a foreign permanent
establishment or fixed base, within the meaning of an applicable income tax
treaty, of such Person or any other U.S. Person.
"Disqualified Organization": A "disqualified organization" under Section
860E of the Code, which as of the Closing Date is any of: (i) the United States,
any state or political subdivision thereof, any possession of the United States,
any foreign government, any international organization, or any agency or
instrumentality of any of the foregoing, (ii) any organization (other than a
cooperative described in Section 521 of the Code) which is exempt from the tax
imposed by Chapter 1 of the Code unless such organization is subject to the tax
imposed by Section 511 of the Code, (iii) any organization described in Section
1381(a)(2)(C) of the Code, or (iv) any other Person so designated by the Trustee
based upon an Opinion of
20
Counsel provided by nationally recognized counsel to the Trustee that the
holding of an ownership interest in a Residual Certificate by such Person may
cause the Trust Fund or any Person having an ownership interest in any Class of
Certificates (other than such Person) to incur 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. A corporation
will not be treated as an instrumentality of the United States or of any state
or political subdivision thereof if all of its activities are subject to tax and
a majority of its board of directors is not selected by a governmental unit. The
term "United States," "state" and "international organization" shall have the
meanings set forth in Section 7701 of the Code.
"Distribution Account": The trust account or accounts created and
maintained by the Trustee pursuant to Section 3.04(b) which shall be entitled
"Distribution Account, U.S. Bank National Association, as Trustee, in trust for
the registered Holders of 2004-CB6 Trust, C-BASS Mortgage Loan Asset-Backed
Certificates, Series 2004-CB6" and which must be an Eligible Account.
"Distribution Date": The 25th day of any calendar month, or if such 25th
day is not a Business Day, the Business Day immediately following such 25th day,
commencing in September 2004.
"DBRS": Dominion Bond Rating Service and its successors and if such
company shall for any reason no longer perform the functions of a securities
rating agency, "DBRS" shall be deemed to refer to any other "nationally
recognized statistical rating organization" as set forth on the most current
list of such organizations released by the Securities and Exchange Commission.
"Due Date": With respect to each Mortgage Loan and any Distribution Date,
the day of the calendar month in which such Distribution Date occurs on which
the Monthly Payment for such Mortgage Loan was due, exclusive of any grace
period.
"Eligible Account": Any of (i) an account or accounts maintained with a
federal or state chartered depository institution or trust company the
short-term unsecured debt obligations of which (or, in the case of a depository
institution or trust company that is the principal subsidiary of a holding
company, the short-term unsecured debt obligations of such holding company) are
rated "A - 2" (or the equivalent) by each of the Rating Agencies at the time any
amounts are held on deposit therein, (ii) an account or accounts the deposits in
which are fully insured by the FDIC (to the limits established by such
corporation), the uninsured deposits in which account are otherwise secured such
that, as evidenced by an Opinion of Counsel delivered to the Trustee and to each
Rating Agency, the Certificateholders will have a claim with respect to the
funds in such account or a perfected first priority security interest against
such collateral (which shall be limited to Permitted Investments) securing such
funds that is superior to claims of any other depositors or creditors of the
depository institution with which such account is maintained, (iii) a trust
account or accounts maintained with the trust department of a federal or state
chartered depository institution, national banking association or trust company
acting in its fiduciary capacity or (iv) an account otherwise acceptable to each
Rating Agency without reduction or withdrawal of their then current ratings of
the Certificates as evidenced by a letter from each Rating Agency to the
Trustee.
21
"Eligible Substitute Mortgage Loan": A mortgage loan substituted for a
Defective 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, and not more than 5% less
than, the outstanding principal balance of the Defective Mortgage Loan as of the
Due Date in the calendar month during which the substitution occurs, (ii) have a
Mortgage Interest Rate, with respect to a Group II Mortgage Loan, not less than
the Mortgage Interest Rate of the Defective Mortgage Loan and not more than 1%
in excess of the Mortgage Interest Rate of such Defective Mortgage Loan, (iii)
if a Group I Mortgage Loan, have a Maximum Loan Rate not less than the Maximum
Loan Rate for the Defective Mortgage Loan, (iv) if a Group I Mortgage Loan, have
a Minimum Loan Rate not less than the Minimum Loan Rate of the Defective
Mortgage Loan, (v) if a Group I Mortgage Loan, have a Gross Margin equal to or
greater than the Gross Margin of the Defective Mortgage Loan, (vi) if a Group I
Mortgage Loan, have the same Index as the Defective Mortgage Loan, (vii) if a
Group I Mortgage Loan, have a next Adjustment Date not more than two months
later than the next Adjustment Date on the Defective Mortgage Loan, (viii) have
a remaining term to maturity not greater than (and not more than one year less
than) that of the Defective Mortgage Loan, (ix) be current as of the date of
substitution, (x) have a Combined Loan-to-Value Ratio as of the date of
substitution equal to or lower than the Combined Loan-to-Value Ratio of the
Defective Mortgage Loan as of such date, (xi) have a risk grading determined by
the Seller at least equal to the risk grading assigned on the Defective Mortgage
Loan, (xii) have been reunderwritten by the Seller in accordance with the same
underwriting criteria and guidelines as the Defective Mortgage Loan, (xiii) have
the same Due Date as the Defective Mortgage Loan and (xiv) conform to each
representation and warranty set forth in Section 2.04 hereof applicable to the
Defective Mortgage Loan. In the event that one or more mortgage loans are
substituted for one or more Defective Mortgage Loans, the amounts described in
clause (i) hereof shall be determined on the basis of aggregate principal
balances, the Mortgage Interest Rates described in clause (ii) hereof shall be
determined on the basis of weighted average Mortgage Interest Rates, the risk
gradings described in clause (xi) hereof shall be satisfied as to each such
mortgage loan, the terms described in clause (viii) hereof shall be determined
on the basis of weighted average remaining term to maturity, the Combined
Loan-to-Value Ratios 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 (xiv) hereof
must be satisfied as to each Eligible Substitute Mortgage Loan or in the
aggregate, as the case may be.
"ERISA": The Employee Retirement Income Security Act of 1974, as amended.
"ERISA-Restricted Certificates": Any of the Class M-1, Class M-2, Class
M-3, Class B-1, Class B-2, Class B-3, Class B-4, Class N, Class X, Class R-X and
Class R Certificates.
"Escrow Account": The account or accounts created and maintained pursuant
to Section 3.06.
"Escrow Payments": The amounts constituting ground rents, taxes,
assessments, water rates, mortgage insurance premiums, fire and hazard insurance
premiums and other payments required to be escrowed by the Mortgagor with the
mortgagee pursuant to any Mortgage Loan.
22
"Estate in Real Property": A fee simple estate in a parcel of real
property.
"Expense Fee Rate": The sum of (i) the Trustee Fee Rate and (ii) the
Servicing Fee Rate.
"Extended Period": As defined in Section 9.04(b).
"Extra Principal Distribution Amount": As of any Distribution Date, the
lesser of (x) 99.95% of the Monthly Excess Interest Amount for such Distribution
Date and (y) the Overcollateralization Deficiency for such Distribution Date.
"FDIC": Federal Deposit Insurance Corporation or any successor thereto.
"FHA": The Federal Housing Administration, an agency within HUD.
"FHA Approved Mortgagee": Those institutions which are approved by FHA to
act as servicer and mortgagee of record pursuant to FHA Regulations.
"FHA Insurance Contract" or "FHA Insurance": The contractual obligation of
FHA respecting the insurance of an FHA Loan pursuant to the National Housing
Act, as amended.
"FHA Loan": A Mortgage Loan which is the subject of an FHA Insurance
Contract as evidenced by a Mortgage Insurance Certificate.
"FHA Regulations": Regulations promulgated by HUD under the National
Housing Act, codified in 24 Code of Federal Regulations, and other HUD issuances
relating to FHA Loans, including the related handbooks, circulars, notices and
mortgagee letters.
"Fidelity Bond": Shall have the meaning assigned thereto in Section 3.12.
"Final Recovery Determination": With respect to any defaulted Mortgage
Loan or any REO Property (other than a Mortgage Loan or REO Property purchased
by the Seller or the Servicer pursuant to or as contemplated by Section 2.03 or
10.01), a determination made by the Servicer that all Insurance Proceeds,
Liquidation Proceeds and other payments or recoveries which the Servicer, in its
reasonable good faith judgment, expects to be finally recoverable in respect
thereof have been so recovered. The Servicer shall maintain records, prepared by
a Servicing Officer, of each Final Recovery Determination made thereby.
"First Lien Mortgage Loan": Any of the Mortgage Loans which are secured by
a first mortgage lien that is senior to a Second Lien Mortgage Loan on the
related Mortgaged Property.
"Fitch": Fitch Ratings and its successors, and if such company shall for
any reason no longer perform the functions of a securities rating agency,
"Fitch" shall be deemed to refer to any other "nationally recognized statistical
rating organization" as set forth on the most current list of such organizations
released by the Securities and Exchange Commission.
"Foreclosure Price": The amount reasonably expected to be received from
the sale of the related Mortgaged Property net of any expenses associated with
foreclosure proceedings.
23
"Grantor Trust": That portion of the Trust exclusive of REMIC 1, REMIC 2,
REMIC 3, REMIC 4, REMIC 5, REMIC 6, REMIC 7, REMIC 8 and REMIC 9 which holds (a)
the REMIC 9 X/N Interest and (b) the obligation to pay LIBOR Carryover Amounts.
"Gross Margin": With respect to each Group I Mortgage Loan, the fixed
percentage, if any, 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 Interest Rate for such Mortgage
Loan.
"Group I Available Funds Cap": With respect to any Distribution Date, a
per annum rate (subject to adjustment based on the actual number of days elapsed
in the related Interest Accrual Period) equal to 12 times the quotient of (x)
the total scheduled interest on the Group I Mortgage Loans for the related
Interest Accrual Period at the Net Mortgage Interest Rates and (y) the aggregate
Principal Balance of the Group I Mortgage Loans (as of the first day of the
related Collection Period).
"Group I Group Subordinate Amount": For any Distribution Date, the excess
of the aggregate Principal Balance of the Group I Mortgage Loans (as of the
first day of the related Collection Period) over the aggregate Certificate
Principal Balance of the Class AV-1 Certificates as of such Distribution Date
(before distributions in respect of principal on such Distribution Date).
"Group I Interest Remittance Amount": As of any Distribution Date, the
sum, without duplication, of (i) all interest received by the Servicer on or
prior to the related Determination Date for such Distribution Date or advanced
with respect to Monthly Payments due during the related Collection Period on the
Group I Mortgage Loans (less the Servicing Fee, amounts available for
reimbursement of Advances and Servicing Advances pursuant to Section 3.05 and
expenses reimbursable pursuant to Section 6.03), (ii) the portion of any full or
partial Principal Prepayment related to interest with respect to a Group I
Mortgage Loan received during the related Prepayment Period, (iii) all
Compensating Interest paid by the Servicer on the related Determination Date
with respect to the Group I Mortgage Loans, (iv) the portion of any payment in
connection with any Purchase Price, Net Liquidation Proceeds, Insurance Proceeds
or Condemnation Proceeds relating to interest with respect to the Group I
Mortgage Loans received during the related Prepayment Period, (v) the portion of
any Substitution Adjustment Amount relating to interest with respect to the
Group I Mortgage Loans received during the related Prepayment Period, (vi) with
respect to the related Distribution Date on which the Trust is to be terminated
in accordance with the Section 10.01 hereof, that portion of the Termination
Price with respect to the Group I Mortgage Loans in respect of interest and
(vii) the portion of any Reimbursement Amount or Subsequent Recovery allocable
to interest related to the Group I Mortgage Loans received during the related
Prepayment Period.
"Group I Maximum Rate Cap": With respect to any Distribution Date, a per
annum rate (subject to adjustment based on the actual number of days elapsed in
the related Interest Accrual Period) equal to the 12 times the quotient of (x)
the total scheduled interest that would have accrued on the Group I Mortgage
Loans at their maximum lifetime Net Mortgage Interest Rates and (y) the
aggregate Principal Balance of the Group I Mortgage Loans (as of the first day
of the related Collection Period).
24
"Group I Mortgage Loan": A Mortgage Loan in Loan Group I.
"Group I Net Rate": With respect to any Distribution Date, a per annum
rate equal to 12 times the quotient of (x) the total scheduled interest on the
Group I Mortgage Loans for the related Interest Accrual Period at their Net
Mortgage Interest Rates and (y) the aggregate Principal Balance of the Group I
Mortgage Loans (as of the first day of the related Collection Period).
"Group I Principal Allocation Percentage": As of any Distribution Date, a
fraction expressed as a percentage, the numerator of which is the Principal
Remittance Amount allocable to the Group I Mortgage Loans during the related
Collection Period and the denominator of which is equal to the Principal
Remittance Amount for such Distribution Date.
"Group I Principal Distribution Amount": As of any Distribution Date, the
product of the Group I Principal Allocation Percentage and the Class A Principal
Distribution Amount.
"Group II Group Subordinate Amount": For any Distribution Date, the excess
of the aggregate Principal Balance of the Group II Mortgage Loans (as of the
first day of the related Collection Period) over the aggregate Certificate
Principal Balance of the Class AF-1, Class AF-2, Class AF-3 and Class AF-4
Certificates as of such Distribution Date (before distributions in respect of
principal on such Distribution Date).
"Group II Interest Remittance Amount": As of any Distribution Date, the
sum, without duplication, of (i) all interest received by the Servicer on or
prior to the related Determination Date for such Distribution Date or advanced
with respect to Monthly Payments due during the related Collection Period on the
Group II Mortgage Loans (less the Servicing Fee, amounts available for
reimbursement of Advances and Servicing Advances pursuant to Section 3.05 and
expenses reimbursable pursuant to Section 6.03), (ii) the portion of any full or
partial Principal Prepayment related to interest with respect to a Group II
Mortgage Loan received during the related Prepayment Period, (iii) all
Compensating Interest paid by the Servicer on the related Determination Date
with respect to the Group II Mortgage Loans, (iv) the portion of any payment in
connection with any Purchase Price, Net Liquidation Proceeds, Insurance Proceeds
or Condemnation Proceeds relating to interest with respect to the Group II
Mortgage Loans received during the related Prepayment Period, (v) the portion of
any Substitution Adjustment Amount relating to interest with respect to the
Group II Mortgage Loans received during the related Prepayment Period, (vi) with
respect to the related Distribution Date on which the Trust is to be terminated
in accordance with the Section 10.01 hereof, that portion of the Termination
Price with respect to the Group II Mortgage Loans in respect of interest and
(vii) the portion of any Reimbursement Amount or Subsequent Recovery related to
the Group II Mortgage Loans related to interest received during the related
Prepayment Period.
"Group II Mortgage Loan": A Mortgage Loan in Loan Group II.
"Group II Net Rate": With respect to any Distribution Date, a per annum
rate equal to 12 times the quotient of (x) the total scheduled interest on the
Group II Mortgage Loans for the related Interest Accrual Period at their Net
Mortgage Interest Rates and (y) the aggregate
25
Principal Balance of the Group II Mortgage Loans (as of the first day of the
related Collection Period).
"Group II Net Rate Cap": With respect to any Distribution Date, a per
annum rate equal to 12 times the quotient of (x) the total scheduled interest on
the Group II Mortgage Loans for the related Interest Accrual Period at their Net
Mortgage Interest Rates and (y) the aggregate Principal Balance of the Group II
Mortgage Loans (as of the first day of the related Collection Period) expressed
(in the case of the Class AF-1 Certificates) on the basis of an assumed 360-day
year and the actual number of days elapsed during the related Interest Accrual
Period minus the product of (x) the Insurer Fee Rate multiplied by (y) a
fraction the numerator of which equals the Class AF-3 Certificate Balance and
the denominator of which equals the aggregate Principal Balance of all Group II
Mortgage Loans.
"Group II Principal Allocation Percentage": As of any Distribution Date, a
fraction expressed as a percentage, the numerator of which is the Principal
Remittance Amount allocable to the Group II Mortgage Loans during the related
Collection Period and the denominator of which is equal to the Principal
Remittance Amount for such Distribution Date.
"Group II Principal Distribution Amount": As of any Distribution Date, the
product of the Group II Principal Allocation Percentage and the Class A
Principal Distribution Amount.
"Group Subordinate Amount": In the case of Loan Group I, the Group I Group
Subordinate Amount, and, in the case of Loan Group II, the Group II Group
Subordinate Amount.
"HUD": The United States Department of Housing and Urban Development, or
any successor thereto, including the Federal Housing Commissioner and the
Secretary of Housing and Urban Development where appropriate under the FHA
Regulations.
"Independent": When used with respect to any specified Person, any such
Person who (i) is in fact independent of the Depositor, the Servicer and their
respective Affiliates, (ii) does not have any direct financial interest in or
any material indirect financial interest in the Depositor or the Servicer or any
Affiliate thereof, and (iii) is not connected with the Depositor or the Servicer
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 or the
Servicer 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 or the
Servicer or any Affiliate thereof, as the case may be.
"Independent Contractor": Either (i) any Person (other than the Servicer)
that would be an "independent contractor" with respect to the Trust Fund within
the meaning of Section 856(d)(3) of the Code if the Trust Fund 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 percent or more of any Class of Certificates), so long as the
Trust Fund does not receive or derive any income from such Person and provided
that the relationship between such Person and the Trust Fund is at arm's length,
all within the meaning of Treasury Regulation Section 1.856-4(b)(5), or (ii) any
other Person (including the Servicer) if the Trustee
26
has received an Opinion of Counsel, which Opinion of Counsel shall be an expense
of the Trust Fund, 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": With respect to each Group I Mortgage Loan and with respect to
each related Adjustment Date, the index as specified in the related Mortgage
Note.
"Initial Certificate Principal Balance": With respect to any Certificate
of a Class other than a Class N, Class X or Residual Certificate, the amount
designated "Initial Certificate Principal Balance" on the face thereof.
"Initial Notional Amount": With respect to any Class N Certificate, the
amount designated "Initial Notional Amount" on the face thereof.
"Initial Overcollateralization Amount": $11,946.539.97.
"Insurance Proceeds": Proceeds of any title policy, hazard policy or other
insurance policy covering a Mortgage Loan, to the extent such proceeds are not
to be applied to the restoration of the related Mortgaged Property or released
to the Mortgagor in accordance with the procedures that the Servicer would
follow in servicing mortgage loans held for its own account, subject to the
terms and conditions of the related Mortgage Note and Mortgage.
"Insured Amounts": With respect to any Distribution Date and the Insured
Certificates, that portion of the Scheduled Payments that shall become due for
payment but shall be unpaid by reason of Nonpayment on such Distribution Date
(which shall be equal to the amount of any related Class AF-3 Certificate
Deficiency Amount (as defined in the Certificate Insurance Policy)).
"Insured Certificates": The Class AF-3 Certificates.
"Insured Payments": With respect to any Distribution Date, the aggregate
amount actually paid by the Certificate Insurer to the Trustee in respect of
Insured Amounts for a Distribution Date.
"Insurer Fee": The fee payable pursuant to the Premium Letter.
"Insurer Fee Rate": The fee rate set forth in the Premium Letter.
"Insurer Reimbursement Amount": As of any Distribution Date, the amount of
all payments made by the Certificate Insurer pursuant to the Certificate
Insurance Policy which have not been previously repaid, with interest thereon at
the applicable Pass-Through Rate, plus all costs and expenses incurred by the
Certificate Insurer in connection with any actions, suits or
27
proceedings with respect to the Certificate Insurance Policy that have been
certified by the Certificate Insurer to the Servicer, with interest thereon at
the applicable Pass-Through Rate.
"Interest Accrual Period": With respect to any Distribution Date and (i)
with respect to the Class AV-1, Class AF-1, Class M-1, Class M-2, Class M-3,
Class B-1, Class B-2 and Class B-3 Certificates, the period from the preceding
Distribution Date through the day prior to the current Distribution Date (or, in
the case of the first Distribution Date, the period from the Closing Date
through September 26, 2004), and (ii) with respect to the Class AF-2, Class
AF-3, Class AF-4, Class B-4, Class N and Class X Certificates, the REMIC 1
Regular Interests and the REMIC 2 X/N Interest, the calendar month immediately
preceding the month in which such Distribution Date occurs.
"Interest Carry Forward Amount": For any Class of Certificates (other than
the Residual Certificates) and any Distribution Date, the sum of (a) the excess,
if any, of the Accrued Certificate Interest and any Interest Carry Forward
Amount for each Class for the prior Distribution Date, over the amount in
respect of interest actually distributed on such Class on such prior
Distribution Date and (b) interest on such excess at the applicable Pass-Through
Rate (x) with respect to the Certificates (other than the Class AF-2, Class
AF-3, Class AF-4, Class B-4, Class N and Class X Certificates), on the basis of
the actual number of days elapsed on the basis of a 360-day year since the prior
Distribution Date, and (y) with respect to the Class AF-2, Class AF-3, Class
AF-4, Class B-4, Class N and Class X Certificates, on the basis of a 360-day
year consisting of twelve 30-day months.
"Interest Percentage": With respect to any Class of Certificates and any
Distribution Date, the ratio (expressed as a decimal carried to ten places) of
the Accrued Certificate Interest for such Class to the sum of the Accrued
Certificate Interest for all Classes of Certificates, in each case with respect
to such Distribution Date and without regard to shortfalls caused by the Relief
Act or similar state law.
"Interest Remittance Amount": As of any Determination Date, the sum of the
Group I Interest Remittance Amount and the Group II Interest Remittance Amount.
"Late Collections": With respect to any Mortgage Loan, all amounts
received subsequent to the Determination Date immediately following any related
Collection Period, 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 on a
contractual basis for such Collection Period and not previously recovered.
"Lender": As defined in Section 3.30(a) hereof.
"LIBOR": With respect to each Interest Accrual Period, the rate determined
by the Trustee on the related LIBOR Determination Date on the basis of the
offered rate for one-month United States dollar deposits, as such rate appears
on the Telerate Page 3750, as of 11:00 a.m. (London time) on such LIBOR
Determination Date. If no such quotations are available on an LIBOR
Determination Date, LIBOR for the related Interest Accrual Period will be
established by the Trustee as follows:
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(i) If on such LIBOR Determination Date two or more Reference Banks
provide quotations as to the rate at which deposits in U.S. Dollars are offered
as of 11:00 a.m. (London time) to prime banks in the London interbank market for
a period of one month in amounts approximately equal to the aggregate
Certificate Principal Balance of the Class AV-1, Class AF-1, Class M-1, Class
M-2, Class M-3, Class B-1, Class B-2 and Class B-3 Certificates, 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
0.001%);
(ii) If on such LIBOR Determination Date fewer than two Reference
Banks provide such offered quotations, LIBOR for the related Interest Accrual
Period shall be the arithmetic mean of the rates quoted by one or more major
banks in New York City, selected by the Trustee after consultation with the
Servicer, as of 11:00 a.m., New York City time, on such date for loans in U.S.
Dollars to leading European banks for a period of one month in amounts
approximately equal to the aggregate Certificate Principal Balance of the Class
AV-1, Class AF-1, Class M-1, Class M-2, Class M-3, Class B-1, Class B-2 and
Class B-3 Certificates; and
(iii) If no such quotations can be obtained, LIBOR for the related
Interest Accrual Period shall be LIBOR for the prior Distribution Date.
"LIBOR Business Day": Any day on which banks in London, England and The
City of New York are open and conducting transactions in foreign currency and
exchange.
"LIBOR Carryover Amount": If on any Distribution Date, the Accrued
Certificate Interest for (a) the Class AV-1 Certificates is based upon the Group
I Available Funds Cap or (b) the Class M-1, Class M-2, Class M-3, Class B-1,
Class B-2, Class B-3 or Class B-4 Certificates is based on the Subordinate Rate
Cap, the excess of (i) the amount of interest such Certificate would have been
entitled to receive on such Distribution Date based on the related Pass-Through
Rate (up to but not exceeding the Group I Maximum Rate Cap in the case of the
Class AV-1 Certificates and up to but not exceeding the Subordinate Maximum Rate
Cap in the case of the Class M-1, Class M-2, Class M-3, Class B-1, Class B-2,
Class B-3 and Class B-4 Certificates), over (ii) the amount of interest such
Certificate was entitled to receive on such Distribution Date based on the
applicable Cap, together with the unpaid portion of any such excess from prior
Distribution Dates (and interest accrued thereon at the then applicable
Pass-Through Rate on such Certificate).
"LIBOR Determination Date": With respect to the Offered Certificates
(other than the Class AF-2, Class AF-3 and Class AF-4 Certificates), (i) for the
first Distribution Date, the second LIBOR Business Day preceding the Closing
Date and (ii) for each subsequent Distribution Date, the second LIBOR Business
Day prior to the immediately preceding Distribution Date.
"Liquidated Mortgage Loan": As to any Distribution Date, any Mortgage Loan
in respect of which the Servicer has determined, in accordance with the
servicing procedures specified herein, as of the end of the related Prepayment
Period, that all Liquidation Proceeds and Insurance Proceeds which it expects to
recover with respect to the liquidation of the Mortgage Loan or disposition of
the related REO Property have been recovered.
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"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 the Trust Fund by reason of its being purchased, sold or replaced
pursuant to or as contemplated by Section 2.03 or Section 10.01. 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 the Trust Fund by reason of its being sold or purchased pursuant to
Section 3.13 or Section 10.01.
"Liquidation Proceeds": The amount (other than amounts received in respect
of the rental of any REO Property prior to REO Disposition) received by the
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 or (ii) the
liquidation of a defaulted Mortgage Loan by means of a trustee's sale,
foreclosure sale or otherwise.
"Liquidation Report": The report with respect to a Liquidated Mortgage
Loan in such form and containing such information as is agreed to by the
Servicer and the Trustee.
"Loan Group": Either Loan Group I or Loan Group II, as the context
requires.
"Loan Group Balance": Either the Group I Loan Balance or the Group II Loan
Balance, as applicable.
"Loan Group I": The pool of Mortgage Loans identified in Exhibit D-1 of
the Mortgage Loan Schedule as having been assigned to Loan Group I.
"Loan Group II": The pool of Mortgage Loans identified in Exhibit D-2 of
the Mortgage Loan Schedule as having been assigned to Loan Group II.
"Losses": As defined in Section 9.03.
"Lost Note Affidavit": With respect to any Mortgage Loan as to which the
original Mortgage Note has been permanently lost or destroyed and has not been
replaced, an affidavit from the Seller certifying that the original Mortgage
Note has been lost, misplaced or destroyed (together with a copy of the related
Mortgage Note and indemnifying the Trust against any loss, cost or liability
resulting from the failure to deliver the original Mortgage Note) in the form of
Exhibit H hereto.
"Majority Certificateholders": The Holders of Certificates evidencing at
least 51% of the Voting Rights.
"Majority Class R Certificateholders": The Holders of Class R Certificates
evidencing at least a 51% Percentage Interest in the Class R Certificates.
"Marker Interest": Each of the LT1-AV1 Interest, the LT1-AF1 Interest, the
LT1-AF2 Interest, the LT1-AF3 Interest, the LT1-AF4 Interest, the LT1-M1
Interest, the LT1-M2 Interest, the LT1-M3 Interest, the LT1-B1 Interest, the
LT1-B2 Interest, the LT1-B3 Interest and the LT1-B4 Interest.
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"Maximum Loan Rate": With respect to each Group I Mortgage Loan, the
percentage set forth in the related Mortgage Note as the maximum Mortgage
Interest Rate thereunder.
"Minimum Loan Rate": With respect to each Group I Mortgage Loan, the
percentage set forth in the related Mortgage Note as the minimum Mortgage
Interest Rate thereunder or if no such percentage is set forth in the related
Mortgage Note, the Gross Margin set forth in the related Mortgage Note.
"Monthly Excess Cashflow Amount": The sum of the Monthly Excess Interest
Amount, the Overcollateralization Release Amount and (without duplication) any
portion of the Principal Distribution Amount remaining after principal
distributions on the Offered Certificates and the Class B-4 Certificates.
"Monthly Excess Interest Amount": With respect to each Distribution Date,
the amount, if any, by which the Interest Remittance Amount for such
Distribution Date exceeds the aggregate amount distributed on such Distribution
Date pursuant to paragraphs (i) through (xi) under Section 4.01.
"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 Servicer pursuant to Section 3.01; 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. and its successors, and if such
company shall for any reason no longer perform the functions of a securities
rating agency, "Moody's" shall be deemed to refer to any other "nationally
recognized statistical rating organization" as set forth on the most current
list of such organizations released by the Securities and Exchange Commission.
"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 documents listed in Section 2.01 pertaining
to a particular Mortgage Loan and any additional documents required to be added
to the Mortgage File pursuant to this Agreement.
"Mortgage Insurance Certificate": The certificate evidencing an FHA
Insurance Contract.
"Mortgage Interest 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 (i) in
the case of each Group I Mortgage Loan (A) as of any date of determination until
the first Adjustment Date following the Cut-off Date shall be the
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rate set forth in the Mortgage Loan Schedule as the Mortgage Interest 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, to equal the sum, rounded to the nearest 0.125% as provided in
the Mortgage Note, of the Index, determined as set forth in the related Mortgage
Note, plus the related Gross Margin subject to the limitations set forth in the
related Mortgage Note and (ii) in the case of each Group II Mortgage Loan shall
remain constant at the rate set forth in the Mortgage Loan Schedule as the
Mortgage Interest Rate in effect immediately following the Cut-off Date. 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.
"Mortgage Loan": Each mortgage loan transferred and assigned to the
Trustee pursuant to Section 2.01 or Section 2.03(d) as from time to time held as
a part of the Trust Fund, the Mortgage Loans so held being identified in the
Mortgage Loan Schedule and set forth in Exhibits D-1 and D-2 attached hereto.
"Mortgage Loan Purchase Agreement": The agreement between the Seller and
the Depositor, dated as of September 9, 2004, regarding the transfer of the
Mortgage Loans by the Seller to or at the direction of the Depositor attached
hereto as Exhibit G.
"Mortgage Loan Schedule": As of any date (i) with respect to the Mortgage
Loans, the list of such Mortgage Loans included in the Trust Fund on such date,
separately identifying the Group I Mortgage Loans and the Group II Mortgage
Loans, attached hereto as Exhibits D-1 and D-2. The Mortgage Loan Schedule shall
be prepared by the Seller and shall set forth the following information with
respect to each Mortgage Loan:
(1) the Seller's Mortgage Loan identifying number;
(2) the city, state, and zip code of the Mortgaged Property;
(3) the type of Residential Dwelling constituting the Mortgaged Property or a
designation that the Mortgaged Property is a multi-family property;
(4) the occupancy status of the Mortgaged Property at origination;
(5) the original months to maturity;
(6) the date of origination;
(7) the first payment date;
(8) the stated maturity date;
(9) the stated remaining months to maturity;
(10) the original principal amount of the Mortgage Loan;
(11) the Principal Balance of each Mortgage Loan as of the Cut-off Date;
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(12) the Mortgage Interest Rate of the Mortgage Loan as of the Cut-off Date;
(13) the current principal and interest payment of the Mortgage Loan as of the
Cut-off Date;
(14) the contractual interest paid to date of the Mortgage Loan;
(15) if the Mortgage Loan is not owner-financed, the Combined Loan-to-Value
Ratio at origination;
(16) a code indicating the loan performance status of the Mortgage Loan as of
the Cut-off Date;
(17) a code indicating whether the Mortgage Loan is a Simple Interest Mortgage
Loan or an Actuarial Mortgage Loan;
(18) a code indicating whether the Mortgaged Property is in bankruptcy or in
its forbearance period as of the Cut-off Date;
(19) a code indicating whether the Mortgage Loan is conventional, insured by
the FHA or guaranteed by the VA;
(20) a code indicating the Index that is associated with such Mortgage Loan;
(21) the Gross Margin;
(22) the Periodic Rate Cap;
(23) the Minimum Loan Rate;
(24) the Maximum Loan Rate;
(25) a code indicating whether the Mortgage Loan has a prepayment penalty and
the type of prepayment penalty;
(26) the first Adjustment Date immediately following the Cut-off Date;
(27) the rate adjustment frequency;
(28) the payment adjustment frequency;
(29) a code indicating whether the Mortgage Loan is owner-financed; and
(30) a code indicating whether the Mortgage Loan is a Second Lien Mortgage
Loan.
The Mortgage Loan Schedule shall set forth the following information, as
of the Cut-off Date, with respect to the Mortgage Loans in the aggregate, for
each Loan Group: (1) the number of Mortgage Loans; (2) the current Principal
Balance of the Mortgage Loans; (3) the weighted average Mortgage Interest Rate
of the Mortgage Loans; and (4) the weighted average maturity of the Mortgage
Loans. The Mortgage Loan Schedule shall be amended from time to time by the
33
Seller in accordance with the provisions of this Agreement. With respect to any
Eligible Substitute Mortgage Loan, 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
indebtedness evidencing the indebtedness of a Mortgagor under a Mortgage Loan.
"Mortgage Pool": The pool of Mortgage Loans, identified on Exhibits D-1
and D-2 from time to time, and any REO Properties acquired in respect thereof.
"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 or multi-family dwelling.
"Mortgagor": The obligor on a Mortgage Note.
"Net Liquidation Proceeds": With respect to any Liquidated Mortgage Loan
or any other disposition of related Mortgaged Property (including REO Property)
the related Liquidation Proceeds net of Advances, Servicing Advances, Servicing
Fees and any other accrued and unpaid servicing fees received and retained in
connection with the liquidation of such Mortgage Loan or Mortgaged Property.
"Net Mortgage Interest Rate": With respect to any Mortgage Loan, the
Mortgage Interest Rate borne by such Mortgage Loan minus the Expense Fee Rate.
"Net Rate": With respect to any Distribution Date, a per annum rate equal
to 12 times the quotient of (x) the excess of the total scheduled interest on
the Mortgage Loans for the related Interest Accrual Period at their Net Mortgage
Rates over the Insurer Fee for such Distribution Date and (y) the aggregate
Principal Balance of the Mortgage Loans (as of the first day of the related
Collection Period).
"New Lease": Any lease of REO Property entered into on behalf of the
Trust, including any lease renewed or extended on behalf of the Trust if the
Trust has the right to renegotiate the terms of such lease.
"Nonpayment": With respect to any Distribution Date, the failure of the
Trustee to receive in full, in accordance with the terms hereof, funds legally
available to pay all or a portion of the Scheduled Payment that is due for
payment with respect to such Distribution Date.
"Nonrecoverable Advance": Any Advance or 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 Servicer, will not or, in the case of a
proposed Advance or Servicing Advance, would not be ultimately recoverable from
Late Collections on such Mortgage Loan or REO Property as provided herein.
"Notional Amount": With respect to the Class N Certificates, an amount
equal to the Original Class N Notional Amount reduced by the aggregate
distributions made to the Class N
34
Certificates in respect of the Class N Notional Amount pursuant to Section
4.02(b)(xxx) or Section 4.02(c).
"Offered Certificates": The Class AV-1, Class AF-1, Class AF-2, Class
AF-3, Class AF-4, Class M-1, Class M-2, Class M-3, Class B-1, Class B-2 and
Class B-3 Certificates.
"Officer's Certificate": 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 the Servicer, the Seller or the
Depositor, as applicable.
"Opinion of Counsel": A written opinion of counsel, who may, without
limitation, be a salaried counsel for the Depositor or the Servicer 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.
"Optional Termination Date": The first Distribution Date on which the
Servicer may opt to terminate the Mortgage Pool pursuant to Section 10.01.
"Original Class N Notional Amount": The Notional Amount of the Class N
Certificates on the Closing Date, as set forth opposite such Class in the
Preliminary Statement.
"Original Class Certificate Principal Balance": With respect to each Class
of Certificates, the Certificate Principal Balance thereof on the Closing Date,
as set forth opposite such Class in the Preliminary Statement, except with
respect to the Class N, Class X and Residual Certificates, which have an
Original Class Certificate Principal Balance of zero.
"Original Notional Amount": The Original Class N Notional Amount.
"Overcollateralization Amount": As of any Distribution Date, the excess,
if any, of (x) the Pool Balance as of the last day of the immediately preceding
Collection Period over (y) the aggregate Certificate Principal Balances of all
Classes of Offered Certificates and the Class B-4 Certificates (after taking
into account all distributions of principal on such Distribution Date).
"Overcollateralization Deficiency": As of any Distribution Date, the
excess, if any, of (x) the Targeted Overcollateralization Amount for such
Distribution Date over (y) the Overcollateralization Amount for such
Distribution Date, calculated for this purpose after taking into account the
reduction on such Distribution Date of the Certificate Principal Balances of all
Classes of Offered Certificates and the Class B-4 Certificates resulting from
the distribution of the Principal Distribution Amount (but not the Extra
Principal Distribution Amount) on such Distribution Date, but prior to taking
into account any Applied Realized Loss Amounts on such Distribution Date.
"Overcollateralization Release Amount": With respect to any Distribution
Date on or after the Stepdown Date on which a Trigger Event is not in effect,
the lesser of (x) the Principal Remittance Amount for such Distribution Date and
(y) the excess, if any, of (i) the Overcollateralization Amount for such
Distribution Date, assuming that 100% of the Principal Remittance Amount is
applied as a principal payment on the Offered Certificates and the Class
35
B-4 Certificates on such Distribution Date, over (ii) the Targeted
Overcollateralization Amount for such Distribution Date. With respect to any
Distribution Date on which a Trigger Event is in effect, the
Overcollateralization Release Amount will be 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.
"Pass-Through Rate": Any of the Class AV-1 Pass-Through Rate, the Class
AF-1 Pass-Through Rate, the Class AF-2 Pass-Through Rate, the Class AF-3
Pass-Through Rate, the Class AF-4 Pass-Through Rate, the Class M-1 Pass-Through
Rate, the Class M-2 Pass-Through Rate, the Class M-3 Pass-Through Rate, Class
B-1 Pass-Through Rate, the Class B-2 Pass-Through Rate, the Class B-3
Pass-Through Rate and the Class B-4 Pass-Through Rate. With respect to the Class
N Certificates, the Pass-Through Rate is 0.00% per annum.
"Paying Agent": Any paying agent appointed pursuant to Section 5.05.
"Percentage Interest": With respect to any Certificate (other than a Class
N, Class X or Residual Certificate), a fraction, 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 Original Class Certificate
Principal Balance of the related Class. With respect to a Class N Certificate,
the undivided percentage interest obtained by dividing the Initial Notional
Amount evidenced by such Certificate by the Original Class N Notional Amount, as
the case may be, of such Class. With respect to a Class X or Residual
Certificate, the portion of the Class evidenced thereby, expressed as a
percentage, as stated on the face of such Certificate; provided, however, that
the sum of all such percentages for each such Class totals 100%.
"Periodic Rate Cap": With respect to each Group I 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 Interest Rate for such
Mortgage Loan may increase or decrease (without regard to the Maximum Loan Rate
or the Minimum Loan Rate) on such Adjustment Date from the Mortgage Interest
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 or managed by the Depositor, the Servicer, the Trustee or any of
their respective Affiliates or for which an Affiliate of the Trustee serves as
an advisor:
(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 agents 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
36
company or its ultimate parent has a short-term uninsured debt rating in one of
the two highest available rating categories of S&P and ▇▇▇▇▇'▇ and the highest
available rating category of Fitch and provided that each such investment has an
original maturity of no more than 365 days 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 or higher
by S&P and Fitch and rated 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 or (B) pursuant to such valuation, be equal,
at all times, to 105% of the cash transferred by the Trustee in exchange for
such collateral and (C) be delivered to the Trustee or, if the Trustee is
supplying the collateral, an agent for the Trustee, 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 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 in its highest short-term unsecured debt rating available
at the time of such investment;
(vi) units of money market funds registered under the Investment Company
Act of 1940 including funds managed or advised by the Trustee or affiliates
thereof having the highest rating category by the applicable Rating Agency; 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 in writing as a permitted investment
of funds backing securities having ratings equivalent to its highest initial
rating of the Class A Certificates;
provided, that (i) 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 and (ii) each
such investment must be a "permitted investment" within the meaning of Section
1.860G(a)(5) of the Code.
"Permitted Transferee": Any transferee of a Residual Certificate other
than a Disqualified Organization or a Disqualified Non-U.S. Person.
"Person": Any individual, corporation, partnership, joint venture,
association, joint stock company, trust, limited liability company,
unincorporated organization or government or any agency or political subdivision
thereof.
37
"Policy Payment": With respect to any Distribution Date, the amount, if
any, paid under the Certificate Insurance Policy for such Distribution Date.
"Policy Payment Account": The separate Eligible Account created and
maintained by the Paying Agent pursuant to Section 5.06 in the name of the
Trustee for the benefit of the Class AF-3 Certificateholders and the Certificate
Insurer, and designated "U.S. Bank National Association, as Trustee, in trust
for the registered Holders of 2004-CB6 Trust, C-BASS Mortgage Loan Asset-Backed
Certificates, Series 2004-CB6, Class AF-3 Certificates."
"Pool Balance": As of any date of determination, the aggregate Principal
Balance of the Mortgage Loans.
"Premium Letter": The letter dated as of September 9, 2004 setting forth
the Insurance Fee Rate.
"Prepayment Interest Shortfall": With respect to any Distribution Date,
for each Mortgage Loan that was during the related Prepayment Period the subject
of a Principal Prepayment in full that was applied by the Servicer to reduce the
outstanding principal balance of such loan on a date preceding the related Due
Date, an amount equal to interest at the applicable Mortgage Interest Rate (net
of the Servicing Fee 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 related Prepayment Period.
"Prepayment Period": With respect to any Distribution Date, the calendar
month preceding the month in which such Distribution Date occurs.
"Primary Insurance Policy": Each policy of primary guaranty mortgage
insurance issued by a Qualified Insurer in effect with respect to any Mortgage
Loan, or any replacement policy therefor obtained by the Servicer pursuant to
Section 3.08.
"Principal Balance": As to any Mortgage Loan and any day, other than a
Liquidated Mortgage Loan, the related Cut-off Date Principal Balance, minus the
sum of (i) all collections and other amounts credited against the principal
balance of any such Mortgage Loan, (ii) the principal portion of Advances, (iii)
any Deficient Valuation and (iv) any principal reduction resulting from a
Servicer Modification. For purposes of this definition, a Liquidated Mortgage
Loan shall be deemed to have a Principal Balance equal to the Principal Balance
of the related Mortgage Loan as of the final recovery of related Liquidation
Proceeds and a Principal Balance of zero thereafter. As to any REO Property and
any day, the Principal Balance of the related Mortgage Loan immediately prior to
such Mortgage Loan becoming REO Property minus any REO Principal Amortization
received with respect thereto on or prior to such day.
"Principal Distribution Amount": As to any Distribution Date, the sum of
(i) the Principal Remittance Amount minus, for Distribution Dates occurring on
and after the Stepdown Date and for which a Trigger Event is not in effect, the
Overcollateralization Release Amount, if any, and (ii) the Extra Principal
Distribution Amount, if any.
"Principal Prepayment": Any 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
38
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 Remittance Amount": With respect to any Distribution Date, to
the extent of funds available therefor, the sum (less amounts available for
reimbursement of Advances and Servicing Advances pursuant to Section 3.05 and
expenses reimbursable pursuant to Section 6.03) of: (i) each payment of
principal on a Mortgage Loan due during the related Collection Period and
received by the Servicer on or prior to the related Determination Date, and any
Advances with respect thereto, (ii) the portion of all full and partial
Principal Prepayments or Insurance Proceeds, Condemnation Proceeds and
Subsequent Recoveries allocable to principal received by the Servicer during the
related Prepayment Period, (iii) the Net Liquidation Proceeds allocable to
principal actually collected by the Servicer during the related Prepayment
Period, (iv) with respect to Defective Mortgage Loans repurchased with respect
to such Prepayment Period, the portion of the Purchase Price allocable to
principal, (v) any Substitution Adjustment Amounts allocable to principal
received during the related Prepayment Period and (vi) on the Distribution Date
on which the Trust is to be terminated in accordance with Section 10.01 hereof,
that portion of the Termination Price in respect of principal.
"Private Certificates": Any of the Class B-4, Class N, Class X and
Residual Certificates.
"Property Insurance Proceeds": Proceeds of any title policy, hazard policy
or other insurance policy covering a Mortgage Loan, to the extent such proceeds
are received by the Servicer and are not to be applied to the restoration of the
related Mortgaged Property or released to the Mortgagor in accordance with the
Servicer's servicing procedures, subject to the terms and conditions of the
related Mortgage Note and Mortgage.
"Proportionate Holder": A Person that beneficially owns pro rata shares of
the Class N and Class X Certificates.
"Prospectus Supplement": That certain Prospectus Supplement dated
September 7, 2004 relating to the public offering of the Offered Certificates.
"Purchase Price": With respect to any Mortgage Loan or REO Property to be
purchased pursuant to or as contemplated by Section 2.03 or 10.01, and as
confirmed by an Officer's Certificate from the Servicer to the Trustee, an
amount equal to the sum of (i) 100% of the Principal Balance thereof as of the
date of purchase (or such other price as provided in Section 10.01), (ii) in the
case of (x) a Mortgage Loan, accrued interest on such Principal Balance at the
applicable Mortgage Interest 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 an
Advance by the Servicer, which payment or Advance had as of the date of purchase
been distributed pursuant to Section 4.01, through the end of the calendar month
in which the purchase is to be effected, and (y) an REO Property, its fair
market value, determined in good faith by the Servicer, (iii) any unreimbursed
Servicing Advances and Advances and any unpaid Servicing Fees allocable to such
Mortgage Loan or REO Property, (iv) any amounts previously withdrawn from the
Collection Account in respect of such Mortgage Loan or REO Property pursuant to
Section 3.13, and (v) in the case of a Mortgage Loan required to be purchased
pursuant to Section 2.03, (x) any costs and damages incurred by the Trust in
connection with any violation by such Mortgage Loan of any predatory
39
and abusive lending law and (y) expenses reasonably incurred or to be incurred
by the Servicer or the Trustee in respect of the breach or defect giving rise to
the purchase obligation.
"Qualified Insurer": Any insurance company acceptable to ▇▇▇▇▇▇ Mae or
▇▇▇▇▇▇▇ Mac.
"Rating Agency or Rating Agencies": Fitch, Moody's, S&P and DBRS, or their
respective successors. If such agencies or their successors are no longer in
existence, "Rating Agencies" shall be such nationally recognized statistical
rating organizations as set forth on the most current list of such organizations
released by the Securities and Exchange Commission and designated by the
Depositor, notice of which designation shall be given to the Trustee and the
Servicer.
"Realized Loss": With respect to a Liquidated Mortgage Loan, the amount by
which the remaining unpaid Principal Balance of the Mortgage Loan plus accrued
and unpaid interest thereon at the Mortgage Interest Rate through the last day
of the month of liquidation, exceeds the amount of Net Liquidation Proceeds
applied to the principal balance of the related Mortgage Loan. With respect to
any Mortgage Loan, a Deficient Valuation or a reduction in the Principal Balance
thereof resulting from a Servicer Modification.
"Realized Loss Amortization Amount": Any of the Class M-1 Realized Loss
Amortization Amount, the Class M-2 Realized Loss Amortization Amount, the Class
M-3 Realized Loss Amortization Amount, the Class B-1 Realized Loss Amortization
Amount, the Class B-2 Realized Loss Amortization Amount, the Class B-3 Realized
Loss Amortization Amount and the Class B-4 Realized Loss Amortization Amount.
"Record Date": With respect to all of the Certificates (except for the
Class AF-2, Class AF-3, Class AF-4, Class B-4, Class N, Class X, Class R and
Class R-X Certificates), the Business Day immediately preceding such
Distribution Date; provided, however, that if any such Certificate becomes a
Definitive Certificate, the Record Date for such Certificate shall be the last
Business Day of the month immediately preceding the month in which the related
Distribution Date occurs. With respect to the Class AF-2, Class AF-3, Class
AF-4, Class B-4, Class N, Class X, Class R and Class R-X Certificates, the last
Business Day of the month immediately preceding the month in which the related
Distribution Date occurs or the Closing Date, in the case of the first
Distribution Date.
"Reference Banks": Those banks (i) with an established place of business
in London, England, (ii) not controlling, under the control of or under common
control with the Depositor or the Trustee, (iii) that have been designated as
such by the Trustee, after consultation with the Servicer and (iv) that are
engaged in transactions in the London interbank market.
"Regular Certificate": Any of the Offered Certificates, the Class B-4
Certificates, the Class N Certificates and the Class X Certificates.
"Regulation S": Regulation S promulgated under the Securities Act or any
successor provision thereto, in each case as the same may be amended from time
to time; and all references to any rule, section or subsection of, or definition
or term contained in, Regulation S means such rule, section, subsection,
definition or term, as the case may be, or any successor thereto, in each case
as the same may be amended from time to time.
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"Regulation S Global Securities": The Book-Entry Regulation S Global
Securities and the Definitive Regulation S Global Securities.
"Reimbursement Amount": As defined in Section 2.03.
"Related Documents": With respect to any Mortgage Loan, the related
Mortgage Notes, Mortgages and other related documents.
"Relief Act": The Servicemembers Civil Relief Act.
"Relief Act Interest Shortfall": With respect to any Distribution Date,
for any Mortgage Loan with respect to which there has been a reduction in the
amount of interest collectible thereon for the most recently ended Collection
Period as a result of the application of the Relief Act or similar state laws,
the amount by which (i) interest collectible on such Mortgage Loan during such
Collection Period is less than (ii) one month's interest on the Principal
Balance of such Mortgage Loan at the Mortgage Interest Rate for such Mortgage
Loan before giving effect to the application of the Relief Act or similar state
laws.
"REMIC": A "real estate mortgage investment conduit" within the meaning of
Section 860D of the Code.
"REMIC Provisions": Provisions of the federal income tax law relating to
real estate mortgage investment conduits which appear at Section 860A through
860G of Subchapter M of Chapter 1 of the Code, and related provisions, and
regulations and rulings promulgated thereunder, as the foregoing may be in
effect from time to time.
"REMIC Regular Interest": Any REMIC 1 Regular Interest, REMIC 2 Regular
Interest, REMIC 3 Regular Interest, REMIC 4 Regular Interest, REMIC 5 Regular
Interest, REMIC 6 Regular Interest, REMIC 7 Regular Interest, REMIC 8 Regular
Interest or REMIC 9 Regular Interest.
"REMIC 1": As defined in the Preliminary Statement.
"REMIC 1 Interest": Each interest in REMIC 1 as described in the
Preliminary Statement.
"REMIC 1 Regular Interest": Each REMIC 1 Interest other than the Class R-1
Interest.
"REMIC 1 Subordinated Balance Ratio": The ratio among the principal
balances of the Class LT1-IA Interest and the Class LT1-IIA Interest that is
equal to the ratio among, with respect to each such REMIC 1 Regular Interest,
the Group Subordinate Amount for the related Loan Group.
"REMIC 2": As defined in the Preliminary Statement.
"REMIC 2 Interest": Each of the REMIC 2 Regular Interests and the Class R-2
Interest.
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"REMIC 2 Regular Interest": Each of the Class AF-1 Certificates, the Class
AF-2 Certificates, the Class AF-4 Certificates, the REMIC 2 AV-1 Interest, the
REMIC 2 AF-3 Interest, the REMIC 2 M-1 Interest, the REMIC 2 M-2 Interest, the
REMIC 2 M-3 Interest, the REMIC 2 B-1 Interest, the REMIC 2 B-2 Interest, the
REMIC 2 B-3 Interest, the REMIC 2 B-4 Interest and the REMIC 2 X/N Interest.
"REMIC 2 AV-1 Interest": An uncertificated "regular interest" in REMIC 2
represented by the Class AV-1 Certificates having the same rights to payments as
the Class AV-1 Certificates other than the right to any payments in respect of
LIBOR Carryover Amounts.
"REMIC 2 AF-3 Interest": An uncertificated "regular interest" in REMIC 2
held by REMIC 3 having the same rights to payments as the Class AF-3
Certificates.
"REMIC 2 M-1 Interest": An uncertificated "regular interest" in REMIC 2
represented by the Class M-1 Certificates having the same rights to payments as
the Class M-1 Certificates other than the right to any payments in respect of
LIBOR Carryover Amounts.
"REMIC 2 M-2 Interest": An uncertificated "regular interest" in REMIC 2
represented by the Class M-2 Certificates having the same rights to payments as
the Class M-2 Certificates other than the right to any payments in respect of
LIBOR Carryover Amounts.
"REMIC 2 M-3 Interest": An uncertificated "regular interest" in REMIC 2
held by REMIC 4 having the same rights to payments as the Class M-3 Certificates
other than the right to any payments in respect of LIBOR Carryover Amounts.
"REMIC 2 B-1 Interest": An uncertificated "regular interest" in REMIC 2
held by REMIC 5 having the same rights to payments as the Class B-1 Certificates
other than the right to any payments in respect of LIBOR Carryover Amounts.
"REMIC 2 B-2 Interest": An uncertificated "regular interest" in REMIC 2
held by REMIC 6 having the same rights to payments as the Class B-2 Certificates
other than the right to any payments in respect of LIBOR Carryover Amounts.
"REMIC 2 B-3 Interest": An uncertificated "regular interest" in REMIC 2
held by REMIC 7 having the same rights to payments as the Class B-3 Certificates
other than the right to any payments in respect of LIBOR Carryover Amounts.
"REMIC 2 B-4 Interest": An uncertificated "regular interest" in REMIC 2
held by REMIC 8 having the same rights to payments as the Class B-4 Certificates
other than the right to any payments in respect of LIBOR Carryover Amounts.
"REMIC 2 X/N Interest": An uncertificated "regular interest" in REMIC 2
held by REMIC 9 having an initial principal balance of $11,946,539.97 and
bearing interest at the REMIC 2 X/N Interest Distributable Interest Rate on a
notional balance equal to 99.95% of the aggregate of the Principal Balance of
the Mortgage Loans outstanding as of the beginning of the related Interest
Accrual Period. The REMIC 2 Class X/N Interest shall be entitled to all
prepayment penalties (including amounts deposited in connection with the full or
partial waiver of such prepayment penalties pursuant to Section 3.01).
42
"REMIC 2 X/N Interest Current Interest": As of any Distribution Date, the
interest accrued during the related Interest Accrual Period at the REMIC 2 X/N
Interest Distributable Interest Rate on a notional amount equal to 99.95% of the
aggregate of the Principal Balance of the Mortgage Loans outstanding as of the
beginning of such Interest Accrual Period (such amount of interest representing
a "specified portion" (within the meaning of Treasury Regulations Section
1.860G-1(a)(2)(i)(C)) of interest payments on the REMIC 1 Regular Interests
(other than the LT1-IB Interest and the LT1-IIB Interest)).
"REMIC 2 X/N Interest Distributable Interest Rate": The excess, if any, of
(a) the weighted average of the interest rates on the REMIC 1 Regular Interests
over (b) two times the weighted average of the interest rates on the Marker
Interests and the LT1-X1 Interest (treating for purposes of this clause (b) the
interest rate on each of the Marker Interests as being subject to a cap and a
floor equal to the Pass-Through Rate (as adjusted to reflect a 30-day accrual
period) of the Related Certificate of such Marker Interest (as described in the
Preliminary Statement) and treating the LT1-X1 Interest as being capped at
zero). The averages described in the preceding sentence shall be weighted on the
basis of the respective principal balances of the relevant REMIC 1 Regular
Interests immediately prior to any date of determination. "REMIC 3": As defined
in the Preliminary Statement.
"REMIC 3 Interest": Each of the REMIC 3 Regular Interests and the Class
R-3 Interest.
"REMIC 3 Regular Interest": The Class AF-3 Certificates.
"REMIC 4": As defined in the Preliminary Statement.
"REMIC 4 Interest": Each of the REMIC 4 Regular Interests and the Class
R-4 Interest.
"REMIC 4 Regular Interest": The REMIC 4 M-3 Interest.
"REMIC 4 M-3 Interest": An uncertificated "regular interest" in REMIC 4
represented by the Class M-3 Certificates having the same rights to payments as
the Class M-3 Certificates other than the right to any payments in respect of
LIBOR Carryover Amounts.
"REMIC 5": As defined in the Preliminary Statement.
"REMIC 5 Interest": Each of the REMIC 5 Regular Interests and the Class
R-5 Interest.
"REMIC 5 Regular Interest": The REMIC 5 B-1 Interest.
"REMIC 5 B-1 Interest": An uncertificated "regular interest" in REMIC 5
represented by the Class B-1 Certificates having the same rights to payments as
the Class B-1 Certificates other than the right to any payments in respect of
LIBOR Carryover Amounts.
"REMIC 6": As defined in the Preliminary Statement.
"REMIC 6 Interest": Each of the REMIC 6 Regular Interests and the Class
R-6 Interest.
"REMIC 6 Regular Interest": The REMIC 6 B-2 Interest.
43
"REMIC 6 B-2 Interest": An uncertificated "regular interest" in REMIC 6
represented by the Class B-2 Certificates having the same rights to payments as
the Class B-2 Certificates other than the right to any payments in respect of
LIBOR Carryover Amounts.
"REMIC 7": As defined in the Preliminary Statement.
"REMIC 7 Interest": Each of the REMIC 7 Regular Interests and the Class
R-7 Interest.
"REMIC 7 Regular Interest": The REMIC 7 B-3 Interest.
"REMIC 7 B-3 Interest": An uncertificated "regular interest" in REMIC 7
represented by the Class B-7 Certificates having the same rights to payments as
the Class B-3 Certificates other than the right to any payments in respect of
LIBOR Carryover Amounts.
"REMIC 8": As defined in the Preliminary Statement.
"REMIC 8 Interest": Each of the REMIC 8 Regular Interests and the Class
R-8 Interest.
"REMIC 8 Regular Interest": The REMIC 8 B-4 Interest.
"REMIC 8 B-4 Interest": An uncertificated "regular interest" in REMIC 8
having the same rights to payments as the Class B-4 Certificates other than the
right to any payments in respect of LIBOR Carryover Amounts.
"REMIC 9": As defined in the Preliminary Statement.
"REMIC 9 Interest": Each of the REMIC 9 Regular Interests and the Class
R-9 Interest.
"REMIC 9 Regular Interest": The REMIC 9 X/N Interest.
"REMIC 9 X/N Interest": An uncertificated "regular interest" in REMIC 9
held by the Trustee on behalf of the holders of the Class X and Class N
Certificates and entitled to all payments in respect of the REMIC 2 X/N
Interest.
"Remittance Report": A report prepared by the Servicer and delivered to
the Trustee pursuant to Section 4.07, containing the information attached hereto
as Exhibit M.
"Rents from Real Property": With respect to any REO Property, gross income
of the character described in Section 856(d) of the Code.
"REO Disposition": The sale or other disposition of an REO Property on
behalf of the Trust Fund.
"REO Principal Amortization": With respect to any REO Property, for any
calendar month, 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 that is allocable to such REO Property) or
otherwise, net of any portion of such amounts (i) payable pursuant to Section
3.13 in
44
respect of the proper operation, management and maintenance of such REO Property
or (ii) payable or reimbursable to the Servicer pursuant to Section 3.13 for
unpaid Servicing Fees in respect of the related Mortgage Loan and unreimbursed
Servicing Advances and Advances in respect of such REO Property or the related
Mortgage Loan.
"REO Property": A Mortgaged Property acquired by the Servicer on behalf of
the Trust Fund through foreclosure or deed-in-lieu of foreclosure, as described
in Section 3.13.
"Request for Release": A release signed by a Servicing Officer, in the
form of Exhibit E attached hereto.
"Residential Dwelling": Any one of the following: (i) a one-family
dwelling, (ii) a two- to four-family dwelling, (iii) a one-family dwelling unit
in a ▇▇▇▇▇▇ ▇▇▇ eligible condominium project, (iv) a one-family dwelling in a
planned unit development, which is not a co-operative, or (v) a mobile or
manufactured home (as defined in ▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇▇ Code, Section 5402(6)).
"Residual Certificates": The Class R Certificates and the Class R-X
Certificates .
"Residual Interest": The sole Class of "residual interests" in each REMIC
within the meaning of Section 860G(a)(2) of the Code.
"Responsible Officer": When used with respect to the Trustee, any officer
assigned to the Corporate Trust Division (or any successor thereto), including
any Vice President, Assistant Vice President, Trust Officer, any Assistant
Secretary, any trust officer or any other officer of the Trustee customarily
performing functions similar to those performed by any of the above designated
officers and in each case having direct responsibility for the administration of
this Agreement.
"S&P": Standard & Poor's, a division of The ▇▇▇▇▇▇-▇▇▇▇ Companies, Inc.,
and its successors, and if such company shall for any reason no longer perform
the functions of a securities rating agency, "S&P" shall be deemed to refer to
any other "nationally recognized statistical rating organization" as set forth
on the most current list of such organizations released by the Securities and
Exchange Commission.
"Scheduled Payment": as defined in the Certificate Insurance Policy.
"Second Lien Mortgage Loan": Any of the Mortgage Loans which are secured
by a second mortgage lien that is junior to a First Lien Mortgage Loan on the
related Mortgaged Property.
"Seller": Credit-Based Asset Servicing and Securitization LLC, or its
successor in interest, in its capacity as seller under the Mortgage Loan
Purchase Agreement.
"Senior Certificates": The Class AV-1, Class AF-1, Class AF-2, Class AF-3
and Class AF-4 Certificates.
"Senior Enhancement Percentage": For any Distribution Date, the percentage
obtained by dividing (x) the sum of (i) the aggregate Certificate Principal
Balances of the Subordinated
45
Certificates and (ii) the Overcollateralization Amount, in each case after
taking into account the distribution of the Principal Distribution Amount on
such Distribution Date by (y) the Pool Balance as of the last day of the related
Collection Period.
"Senior Specified Enhancement Percentage": On any date of determination
thereof, 36.70%.
"Servicer": ▇▇▇▇▇▇ Loan Servicing LP, a Delaware limited partnership, or
any successor servicer appointed as herein provided, in its capacity as Servicer
hereunder.
"Servicer Affiliate": A Person (i) controlling, controlled by or under
common control with the Servicer or which is 50% or more owned by the Servicer
and (ii) which is qualified to service residential mortgage loans.
"Servicer Event of Termination": One or more of the events described in
Section 7.01.
"Servicer Modification": A modification to the terms of a Mortgage Loan,
in accordance with the terms of Section 3.01, as to which the Mortgagor is in
default or as to which, in the judgment of the Servicer, default is reasonably
foreseeable.
"Servicer Remittance Date": With respect to any Distribution Date, one
Business Day prior to such Distribution Date.
"Servicer's Assignee": As defined in Section 3.30(b) hereof.
"Servicing Advances": All customary, reasonable and necessary "out of
pocket" costs and expenses incurred by the Servicer in the performance of its
servicing obligations to the extent such costs or expenses constitute
"unanticipated expenses" within the meaning of Treasury Regulations
1.860G-1(b)(3)(ii), including, but not limited to, the cost of (i) the
preservation, restoration and protection of the Mortgaged Property, (ii) any
enforcement or judicial proceedings, including foreclosures, (iii) the
management and liquidation of the REO Property and (iv) compliance with the
obligations under Section 3.08.
"Servicing Fee": With respect to each Mortgage Loan (including each REO
Property) and for any calendar month, an amount equal to one month's interest
(or in the event of any payment of interest which accompanies a Principal
Prepayment in full made by the Mortgagor during such calendar month, interest
for the number of days covered by such payment of interest) at the Servicing Fee
Rate on the same principal amount on which interest on such Mortgage Loan
accrues for such calendar month.
"Servicing Fee Rate": With respect to each Mortgage Loan, 0.50% per annum.
"Servicing Officer": Any officer of the Servicer involved in, or
responsible for, the administration and servicing of Mortgage Loans, whose name
and specimen signature appear on a list of servicing officers furnished by the
Servicer to the Trustee and the Depositor on the Closing Date, as such list may
from time to time be amended.
46
"Servicing Rights Pledgee": One or more lenders, selected by the Servicer,
to which the Servicer will pledge and assign all of its right, title and
interest in, to and under this Agreement, including Wachovia Bank, National
Association, as the representative of certain lenders.
"Servicing Standard": Shall mean the standards set forth in Section 3.01.
"Simple Interest Method": The method of allocating a payment to principal
and interest, pursuant to which the portion of such payment that is allocated to
interest is equal to the product of the fixed rate of interest multiplied by the
unpaid principal balance multiplied by the period of time elapsed since the
preceding payment of interest was made and divided by either 360 or 365, as
specified in the related Mortgage Note, and the remainder of such payment is
allocated to principal.
"Simple Interest Mortgage Loan": Any Mortgage Loan under which the portion
of a payment allocable to interest and the portion of such payment allocable to
principal is determined in accordance with the Simple Interest Method.
"Special Hazard Loss": Any Realized Losses that result from direct
physical damage to Mortgaged Properties caused by natural disasters and other
hazards (i) which are not covered by hazard insurance policies (such as
earthquakes) and (ii) for which claims have been submitted and rejected by the
related hazard insurer and any shortfall in insurance proceeds for partial
damage due to the application of the co-insurance clauses contained in hazard
insurance policies.
"SPV": As defined in Section 3.30(a) hereof.
"Startup Day": As defined in Section 9.01(b) hereof.
"Stayed Funds": Any payment required to be made under the terms of the
Certificates and this Agreement but which is not remitted by the Servicer
because the Servicer is the subject of a proceeding under the Bankruptcy Code
and the making of such remittance is prohibited by Section 362 of the Bankruptcy
Code.
"Stepdown Date": The later to occur of (x) the earlier to occur of (A) the
Distribution Date in September 2007 and (B) the Distribution Date on which the
aggregate Certificate Principal Balance of the Class A Certificates is reduced
to zero, and (y) the first Distribution Date on which the Senior Enhancement
Percentage (after taking into account distributions of principal on such
Distribution Date) is greater than or equal to the Senior Specified Enhancement
Percentage.
"Subordinate Maximum Rate Cap": For any Distribution Date will be a per
annum rate equal to the weighted average of the Group I Maximum Rate Cap and the
Group II Net Rate Cap (as adjusted to reflect the actual number of days in the
related Interest Accrual Period) weighted on the basis of the Group I Group
Subordinate Amount and the Group II Group Subordinate Amount, respectively.
"Subordinate Rate Cap": With respect to any Distribution Date, a per annum
rate equal to the weighted average of the Group I Available Funds Cap and the
Group II Net Rate Cap (as adjusted to reflect the actual number of days in the
related Interest Accrual Period), weighted on
47
the basis of the Group I Group Subordinate Amount and the Group II Group
Subordinate Amount, respectively.
"Subordinated Certificates": The Class M-1, Class M-2, Class M-3, Class
B-1, Class B-2, Class B-3, Class B-4, Class N, Class X, Class R and Class R-X
Certificates.
"Subsequent Overcollateralization Amount": As of any Distribution Date,
after the application of principal payments and Applied Realized Loss Amounts,
an amount equal to the excess, if any of (a) the Pool Balance over (b) the sum
of (i) the Certificate Principal Balance of each Class of Offered Certificates
and the Class B-4 Certificates and (ii) the Remaining Initial
Overcollateralization Amount.
"Subsequent Recovery": Any amount received on a Mortgage Loan subsequent
to such Mortgage Loan being determined to be a Liquidated Mortgage Loan.
"Substitution Adjustment Amount": As defined in Section 2.03(d) hereof.
"Targeted Overcollateralization Amount": As of any Distribution Date, (x)
prior to the Stepdown Date, 2.60% of the Pool Balance on the Cut-off Date and
(y) on and after the Stepdown Date, (i) if a Trigger Event has not occurred, the
lesser of (a) 2.60% of the Pool Balance on the Cut-off Date and (b) the greater
of (A) 5.20% of the Pool Balance as of the last day of the related Collection
Period and (B) 0.50% of the Pool Balance on the Cut-off Date and (ii) if a
Trigger Event has occurred, the Targeted Overcollateralization Amount for the
immediately preceding Distribution Date.
"Tax Matters Person": The tax matters person appointed pursuant to Section
9.01(e) hereof.
"Tax Returns": The federal income tax returns 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
the REMIC Taxable Income or Net Loss Allocation, or any successor forms, to be
filed on behalf of the Trust for each of the eight REMICs created pursuant to
this Agreement 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 page currently so designated on the
Moneyline Telerate Service (or such other page as may replace the Telerate Page
3750 page on that service for the purpose of displaying London interbank offered
rates of major banks).
"Termination Price": As defined in Section 10.01(a) hereof.
"Trigger Event": With respect to any Distribution Date, if (i) the
six-month rolling average of 60+ Day Delinquent Loans equals or exceeds 43.00%
of the Senior Enhancement Percentage or (ii) the aggregate amount of Realized
Losses incurred since the Cut-off Date through the last day of the related
Collection Period divided by the Pool Balance as of the Cut-
48
off Date exceeds the applicable percentages set forth below with respect to such
Distribution Date:
DISTRIBUTION DATE OCCURRING IN PERCENTAGE
------------------------------ ----------
September 2007 through August 2008 3.00%
September 2008 through August 2009 5.00%
September 2009 through August 2010 6.50%
September 2010 and thereafter 7.00%
"Trust": 2004-CB6 Trust, the trust created hereunder.
"Trust Fund": The segregated pool of assets subject hereto, constituting
the primary trust created hereby and to be administered hereunder, with respect
to a portion of which eight REMIC elections are to be made, such entire Trust
Fund consisting of: (i) such Mortgage Loans 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), (v) the Collection 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 and (vi) with respect to the Class AF-3
Certificates only, the Certificate Insurance Policy.
"Trustee": U.S. Bank National Association, a national banking association
organized and existing under the laws of New York, or any successor Trustee
appointed as herein provided.
"Trustee Fee": With respect to any Distribution Date, the product of (x)
one-twelfth of the Trustee Fee Rate and (y) the aggregate of the Principal
Balances of all Mortgage Loans as of the opening of business on the first day of
the related Collection Period.
"Trustee Fee Rate": With respect to any Distribution Date, 0.0060% per
annum.
"Underwriters": ▇▇▇▇▇▇▇ Lynch, Pierce, ▇▇▇▇▇▇ & ▇▇▇▇▇ Incorporated and
Greenwich Capital Markets, Inc., as underwriters with respect to the Offered
Certificates.
"United States Person" or "U.S. Person": (i) A citizen or resident of the
United States, (ii) a corporation, partnership or other entity treated as a
corporation or partnership for United States federal income tax purposes
organized in or under the laws of the United States or any state thereof or the
District of Columbia (unless, in the case of a partnership, Treasury regulations
provide otherwise) or (iii) an estate the income of which is includible in gross
income for United States tax purposes, regardless of its source, or (iv) a trust
if a court within the United States is able to exercise primary supervision over
the administration of the trust and one or more United States persons have
authority to control all substantial decisions of the trust.
49
Notwithstanding the preceding sentence, to the extent provided in Treasury
regulations, certain Trusts in existence on August 20, 1996, and treated as
United States persons prior to such date, that elect to continue to be treated
as United States persons will also be a U.S. Person.
"Unpaid Realized Loss Amount": For any Class M-1, Class M-2, Class M-3,
Class B-1, Class B-2, Class B-3 and Class B-4 Certificates and as to any
Distribution Date, the excess of (1) the cumulative amount of related Applied
Realized Loss Amounts with respect to such Class for all prior Distribution
Dates over (2) the sum of (x) the cumulative amount of related Realized Loss
Amortization Amounts with respect to such Class for all prior Distribution Dates
and (y) all increases in the Certificate Principal Balance of such Class
pursuant to the last sentence of the definition of "Certificate Principal
Balance."
"VA": The United States Department of Veterans Affairs.
"VA Approved Lender": Those institutions that are approved by the VA to
act as servicer and mortgagee of record pursuant to the VA Regulations.
"VA Guaranty": The obligation of VA respecting the guaranty of a VA Loan
pursuant to the Servicemen's Readjustment Act of 1944, as amended.
"VA Regulations" Any and all regulations promulgated by the VA under the
Servicemen's Readjustment Act of 1944, as amended.
"Value": With respect to any Mortgaged Property, the lower of the value
thereof as determined by an independent appraisal made at the time of the
origination of the related Mortgage Loan or the sale price, if the appraisal is
not available; except that, with respect to any Mortgage Loan that is a purchase
money mortgage loan, the lesser of (i) the value thereof as determined by an
independent appraisal made at the time of the origination of such Mortgage Loan,
if any, and (ii) the sales price of the related Mortgaged Property.
"Voting Rights": The portion of the voting rights of all of the
Certificates which is allocated to any Certificate. The Voting Rights allocated
among Holders of the Offered Certificates and the Class B-4 Certificates shall
be 98%, and shall be allocated among each such Class according to the fraction,
expressed as a percentage, the numerator of which is the aggregate Certificate
Principal Balance of all the Certificates of such Class then outstanding and the
denominator of which is the aggregate Certificate Principal Balance of all the
Offered Certificates and the Class B-4 Certificates then outstanding. The Voting
Rights allocated to each such Class of Certificates shall be allocated among all
holders of each such Class in proportion to the outstanding Certificate
Principal Balance of such Certificates; provided, however, that any Certificate
registered in the name of the Servicer, the Depositor or the Trustee or any of
their respective affiliates shall not be included in the calculation of Voting
Rights; provided that only such Certificates as are known by a Responsible
Officer of the Trustee to be so registered will be so excluded. On each
Distribution Date (a) prior to the date on which the Notional Amount of the
Class N Certificates is reduced to zero, the percentage of all the Voting Rights
allocated among the Holders of the Class N and Class X Certificates,
respectively, shall be 1% and (b) on and after the date on which the Notional
Amount of the Class N Certificates is reduced to zero, the percentage of all the
Voting Rights allocated among the Holders of the Class N Certificates
50
shall be 0% and the percentage of all the Voting Rights allocated among the
Holder of the Class X Certificates shall be 2%. The Residual Certificates shall
have no Voting Rights. Notwithstanding any of the foregoing, unless a
Certificate Insurer Default is continuing, on any date on which any Insured
Certificates are outstanding, or any amounts are owed to the Certificate Insurer
under this Agreement, the Certificate Insurer will have all Voting Rights of the
Insured Certificates. So long as the Certificate Insurer has the Voting Rights
pursuant to the preceding sentence, references to holders of the Class AF-3
Certificates relating to Voting Rights shall be deemed to refer to the
Certificate Insurer.
"Written Order to Authenticate": A written order by which the Depositor
directs the Trustee to execute, authenticate and deliver the Certificates.
Section 1.02 Accounting.
Unless otherwise specified herein, for the purpose of any definition or
calculation, whenever amounts are required to be netted, subtracted or added or
any distributions are taken into account such definition or calculation and any
related definitions or calculations shall be determined without duplication of
such functions.
ARTICLE II
CONVEYANCE OF MORTGAGE LOANS;
ORIGINAL ISSUANCE OF CERTIFICATES
Section 2.01 Conveyance of 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 and
the Certificate Insurer, all the right, title and interest of the Depositor,
including any security interest therein for the benefit of the Depositor, in and
to (i) each Mortgage Loan identified on the Mortgage Loan Schedule, including
the related Cut-off Date Principal Balance, all interest accruing thereon after
the Cut-off Date and all collections in respect of interest and principal due
after the Cut-off Date; (ii) property which secured each such Mortgage Loan and
which has been acquired by foreclosure or deed in lieu of foreclosure; (iii) its
interest in any insurance policies in respect of the Mortgage Loans and all
rights under the related FHA Insurance Contract and VA Guaranty; (iv) all
proceeds of any of the foregoing; (v) the rights of the Depositor under the
Mortgage Loan Purchase Agreement, and (vi) all other assets included or to be
included in the Trust Fund; provided, however, so long as the Servicer is an FHA
Approved Mortgagee, the Commissioner of HUD shall have no obligation to
recognize or deal with any person other than the Servicer with respect to FHA
Insurance. Such assignment includes all interest and principal due to the
Depositor or the Servicer after the Cut-off Date with respect to the Mortgage
Loans.
It is agreed and understood by the Depositor, the Seller, the Servicer and
the Trustee that it is not intended that any Mortgage Loan be included in the
Trust that is either (i) a "High-Cost Home Loan" as defined in the New Jersey
Home Ownership Act effective November 27, 2003;
51
or (ii) a "High-Cost Home Loan" as defined in the New Mexico Home Loan
Protection Act effective January 1, 2004.
In connection with such transfer and assignment, the Seller, on behalf of
the Depositor, does hereby deliver to, and deposit with the Trustee, or its
designated agent (the "Custodian"), the following documents or instruments with
respect to each Mortgage Loan (a "Mortgage File") so transferred and assigned:
(i) the original Mortgage Note including any riders thereto,
endorsed either (A) in blank or (B) in the following form: "Pay to the order of
U.S. Bank National Association, as Trustee under the Pooling and Servicing
Agreement, dated as of August 1, 2004, among Credit-Based Asset Servicing and
Securitization LLC, ▇▇▇▇▇▇▇ ▇▇▇▇▇ Mortgage Investors, Inc., ▇▇▇▇▇▇ Loan
Servicing LP and U.S. Bank National Association, C-BASS Mortgage Loan
Asset-Backed Certificates, Series 2004-CB6, without recourse," or with respect
to any lost Mortgage Note, an original Lost Note Affidavit, together with a copy
of the related Mortgage Note; provided that no greater than 2% of the Mortgage
files shall have a Lost Note Affidavit in lieu of an original Mortgage Note.
(ii) the original Mortgage including any riders thereto, with
evidence of recording thereon, and the original recorded power of attorney, if
the Mortgage was executed pursuant to a power of attorney, with evidence of
recording thereon or, if such Mortgage or power of attorney has been submitted
for recording but has not been returned from the applicable public recording
office, has been lost or is not otherwise available, a copy of such Mortgage or
power of attorney, as the case may be, certified to be a true and complete copy
of the original submitted for recording;
(iii) an original Assignment of Mortgage, in form and substance
acceptable for recording. The Mortgage shall be assigned either (A) in blank or
(B) to "U.S. Bank National Association, as Trustee under the Pooling and
Servicing Agreement, dated as of August 1, 2004, among Credit-Based Asset
Servicing and Securitization LLC, ▇▇▇▇▇▇▇ ▇▇▇▇▇ Mortgage Investors, Inc., ▇▇▇▇▇▇
Loan Servicing LP and U.S. Bank National Association, C-BASS Mortgage Loan
Asset-Backed Certificates, Series 2004-CB6, without recourse";
(iv) an original or a certified copy of any intervening assignment
of Mortgage showing a complete chain of assignments;
(v) the original or a certified copy of lender's title insurance
policy;
(vi) the original or copies of each assumption, modification,
written assurance or substitution agreement, if any; and
(vii) for each FHA Loan, the original Mortgage Insurance Certificate
and for each VA Loan, the original VA Guaranty.
The Trustee agrees to execute and deliver (or cause the Custodian to
execute and deliver) to the Depositor on or prior to the Closing Date an
acknowledgment of receipt of the original Mortgage Note (with any exceptions
noted), substantially in the form attached as Exhibit F-3 hereto.
52
If any of the documents referred to in Section 2.01(ii), (iii) or (iv)
above has as of the Closing Date been submitted for recording but either (x) has
not been returned from the applicable public recording office or (y) has been
lost or such public recording office has retained the original of such document,
the obligations of the Seller to deliver such documents shall be deemed to be
satisfied upon (1) delivery to the Trustee or the Custodian no later than the
Closing Date, of a copy of each such document certified by the Seller in the
case of (x) above or the applicable public recording office in the case of (y)
above to be a true and complete copy of the original that was submitted for
recording and (2) if such copy is certified by the Seller, delivery to the
Trustee or the Custodian, promptly upon receipt thereof of either the original
or a copy of such document certified by the applicable public recording office
to be a true and complete copy of the original. The Seller shall deliver or
cause to be delivered to the Trustee or the Custodian promptly upon receipt
thereof any other documents constituting a part of a Mortgage File received with
respect to any Mortgage Loan, including, but not limited to, any original
documents evidencing an assumption or modification of any Mortgage Loan.
Upon discovery or receipt of notice of any materially defective document
in, or that a document is missing from, a Mortgage File, the Seller shall have
120 days to cure such defect or 150 days following the Closing Date, in the case
of missing Mortgages or Assignments or deliver such missing document to the
Trustee or the Custodian. If the Seller does not cure such defect or deliver
such missing document within such time period, the Seller shall either
repurchase or substitute for such Mortgage Loan in accordance with Section 2.03.
The Servicer shall cause the Assignments of Mortgage which were delivered
in blank to be completed and shall cause all Assignments referred to in Section
2.01(iii) hereof and, to the extent necessary, in Section 2.01(iv) hereof to be
recorded at the Servicer's expense and of no cost to the Trust Fund; provided,
however, the Servicer need not cause to be recorded any Assignment which relates
to a Mortgage Loan in any jurisdiction under the laws of which, as evidenced by
an Opinion of Counsel delivered by the Servicer to the Trustee and the Rating
Agencies, the recordation of such assignment is not necessary to protect the
Trustee's interest, on behalf of the Trust, in the related Mortgage Loan. The
Servicer shall be required to deliver such assignments for recording within 30
days of the Closing Date. The Servicer shall furnish the Trustee, or its
designated agent, with a copy of each assignment of Mortgage submitted for
recording. In the event that any such Assignment is lost or returned unrecorded
because of a defect therein, the Servicer shall promptly have a substitute
Assignment prepared or have such defect cured, as the case may be, and
thereafter cause each such Assignment to be duly recorded. In the event that any
Mortgage Note is endorsed in blank as of the Closing Date, promptly following
the Closing Date the Servicer shall cause to be completed such endorsements "Pay
to the order of U.S. Bank National Association, as Trustee under the Pooling and
Servicing Agreement, dated as of August 1, 2004, among Credit-Based Asset
Servicing and Securitization LLC, ▇▇▇▇▇▇▇ ▇▇▇▇▇ Mortgage Investors, Inc., ▇▇▇▇▇▇
Loan Servicing LP and U.S. Bank National Association, C-BASS Mortgage Loan
Asset-Backed Certificates, Series 2004-CB6, without recourse."
In the event that any Assignments of Mortgage is not recorded or is
improperly recorded (as a result of actions taken or not taken by a person other
than the Servicer), neither the Servicer nor the Trustee shall have any
liability for its failure to receive notices related to such Assignment of
Mortgage.
53
The Depositor herewith delivers to the Trustee executed copies of the
Mortgage Loan Purchase Agreement.
Section 1.01 Acceptance by Trustee.
The Trustee acknowledges the receipt of, subject to the provisions of
Section 2.01 and subject to the review described below and any exceptions noted
on the exception report described in the next paragraph below, the documents
referred to in Section 2.01 above and all other assets included in the
definition of "Trust Fund" and declares that it holds and will hold such
documents and the other documents delivered to it constituting a Mortgage File,
and that it holds or will hold all such assets and such other assets included in
the definition of "Trust Fund" in trust for the exclusive use and benefit of all
present and future Certificateholders and the Certificate Insurer.
The Trustee agrees, for the benefit of the Certificateholders and the
Certificate Insurer, to review (or cause the Custodian to review) each Mortgage
File within 60 days after the Closing Date (or, with respect to any document
delivered after the Startup Day, within 60 days of receipt and with respect to
any Qualified Substitute Mortgage, within 60 days after the assignment thereof)
and to certify (or cause the Custodian to certify) in substantially the form
attached hereto as Exhibit F-1 that, as to each Mortgage Loan listed in the
Mortgage Loan Schedule (other than any Mortgage Loan paid in full or any
Mortgage Loan specifically identified in the exception report annexed thereto as
not being covered by such certification), (i) all documents required to be
delivered to it pursuant to Section 2.01 of this Agreement are in its
possession, (ii) such documents have been reviewed by it and have not been
mutilated, damaged or torn and relate to such Mortgage Loan and (iii) based on
its examination and only as to the foregoing, the information set forth in the
Mortgage Loan Schedule that corresponds to items (1), (2), (3), (5), (13) and
(26) (in the case of (26), only as to whether there is a prepayment penalty) of
the Mortgage Loan Schedule accurately reflects information set forth in the
Mortgage File. It is herein acknowledged that, in conducting such review, the
Trustee (or the Custodian, as applicable) is under no duty or obligation to
inspect, review or examine any such documents, instruments, certificates or
other papers to determine that they are genuine, enforceable, or appropriate for
the represented purpose or that they have actually been recorded or that they
are other than what they purport to be on their face.
Prior to the first anniversary date of this Agreement the Trustee shall
deliver (or cause the Custodian to deliver) to the Depositor and the Servicer a
final certification in the form annexed hereto as Exhibit F-2 evidencing the
completeness of the Mortgage Files, with any applicable exceptions noted
thereon.
If in the process of reviewing the Mortgage Files and making or preparing,
as the case may be, the certifications referred to above, the Trustee (or the
Custodian, as applicable) finds any document or documents constituting a part of
a Mortgage File to be missing or defective in any material respect, at the
conclusion of its review the Trustee (upon its notification by the Custodian)
shall so notify the Seller, the Depositor and the Servicer. In addition, upon
the discovery by the Seller, Depositor, the Trustee or the Servicer (or upon
receipt by the Trustee of written notification of such breach) of a breach of
any of the representations and warranties made by the Seller in the related
Mortgage Loan Purchase Agreement in respect of any Mortgage Loan
54
which materially adversely affects such Mortgage Loan or the interests of the
related Certificateholders or the Certificate Insurer in such Mortgage Loan, the
party discovering such breach shall give prompt written notice to the other
parties.
The Depositor and the Trustee intend that the assignment and transfer
herein contemplated constitute a sale of the Mortgage Loans and the Related
Documents, conveying good title thereto free and clear of any liens and
encumbrances, from the Depositor to the Trustee and that such property not be
part of the Depositor's estate or property of the Depositor in the event of any
insolvency by the Depositor. In the event that such conveyance is deemed to be,
or to be made as security for, a loan, the parties intend that the Depositor
shall be deemed to have granted and does hereby grant to the Trustee, on behalf
of the Trust, a first priority perfected security interest in all of the
Depositor's right, title and interest in and to the Mortgage Loans and the
Related Documents, and that this Agreement shall constitute a security agreement
under applicable law.
The Trustee is hereby directed to execute and deliver, on behalf of the
Trust, the Certificate Insurance Policy.
Section 2.03 Repurchase or Substitution of Mortgage Loans by the Seller.
(a) Upon discovery or receipt of written notice of any materially
defective document in, or that a document is missing from, a Mortgage File or of
the breach by the Seller of any representation, warranty or covenant under the
Mortgage Loan Purchase Agreement or in Section 2.04 in respect of any Mortgage
Loan which materially adversely affects the value of such Mortgage Loan or the
interest therein of the Certificateholders or the Certificate Insurer, the
Trustee (or the Custodian, as applicable) shall promptly notify the Seller, the
Servicer and the Trustee of such defect, missing document or breach and request
that the Seller deliver such missing document or cure such defect or breach
within 120 days or 150 days following the Closing Date, in the case of missing
Mortgages or Assignments 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 Seller's obligation under the Mortgage
Loan Purchase Agreement and cause the Seller to repurchase such Mortgage Loan
from the Trust Fund at the Purchase Price on or prior to the Determination Date
following the expiration of such 120 day period (subject to Section 2.03(e));
provided that, in connection with any such breach that is susceptible to cure
but that could not reasonably have been cured within such 120 day or 150 day
period, if the Seller shall have commenced to cure such breach within such 120
day or 150 day period, the Seller shall be permitted to proceed thereafter
diligently and expeditiously to cure the same within 120 days. The Purchase
Price for the repurchased Mortgage Loan shall be deposited in the Collection
Account, and the Trustee, upon receipt of written certification from the
Servicer of such deposit, shall release to the Seller the related Mortgage File
and shall execute and deliver such instruments of transfer or assignment, in
each case without recourse, 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 have no further responsibility with regard to such Mortgage
File. In lieu of repurchasing any such Mortgage Loan as provided above, the
Seller may cause such Mortgage Loan to be removed from the Trust Fund (in which
case it shall become a Defective Mortgage Loan) and substitute one or more
Eligible Substitute Mortgage Loans in the manner
55
and subject to the limitations set forth in Section 2.03(d). In addition to the
foregoing, in the case of a breach of the Seller's representation set forth in
Section 3.01(f) of the Mortgage Loan Purchase Agreement, the Seller shall
reimburse the Trust for all costs or damages incurred by the Trust as a result
of the violation of such law (such amount, the "Reimbursement Amount"). The
Reimbursement Amount shall be delivered to the Servicer for deposit into the
Collection Account within 10 days from the date the Seller was notified by the
Trustee of the amount of such costs and damages. It is understood and agreed
that the obligation of the Seller to pay the Reimbursement Amount and to either
cure or repurchase (or 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
against the Seller respecting such omission, defect or breach available to the
Trustee and the Trustee on behalf of the Certificateholders.
(b) [Reserved].
(c) Within 90 days of the earlier of discovery by the Servicer or
receipt of notice by the Servicer of the breach of any representation, warranty
or covenant of the Servicer set forth in Section 2.05 which materially and
adversely affects the interests of the Certificateholders in any Mortgage Loan,
the Servicer shall cure such breach in all material respects.
(d) Any substitution of Eligible Substitute Mortgage Loans for
Defective Mortgage Loans made pursuant to Section 2.03(a) must be effected prior
to the last Business Day that is within two years after the Closing Date. As to
any Defective Mortgage Loan for which the Seller substitutes a Eligible
Substitute Mortgage Loan or Loans, such substitution shall be effected by the
Seller delivering to the Trustee for such Eligible 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 2.01, together with an Officer's Certificate providing that
each such Eligible Substitute Mortgage Loan satisfies the definition thereof and
specifying the Substitution Adjustment Amount (as described below), if any, in
connection with such substitution. The Trustee shall acknowledge receipt for
such Eligible Substitute Mortgage Loan or Loans and, within ten Business Days
thereafter, shall review such documents as specified in Section 2.02 and deliver
(or cause the Custodian to deliver) to the Servicer, with respect to such
Eligible Substitute Mortgage Loan or Loans, a certification substantially in the
form attached hereto as Exhibit F-1, with any applicable exceptions noted
thereon. Within one year of the date of substitution, the Trustee shall deliver
(or cause the Custodian to deliver) to the Servicer a certification
substantially in the form of Exhibit F-2 hereto with respect to such Eligible
Substitute Mortgage Loan or Loans, with any applicable exceptions noted thereon.
Monthly Payments due with respect to Eligible Substitute Mortgage Loans in the
month of substitution are not part of the Trust Fund and will be retained by the
Seller. For the month of substitution, distributions to Certificateholders will
reflect the collections and recoveries in respect of such Defective Mortgage
Loan in the Collection Period preceding the month of substitution and the
Depositor or the Seller, as the case may be, shall thereafter be entitled to
retain all amounts subsequently received in respect of such Defective Mortgage
Loan. The Seller shall give or cause to be given written notice to the
Certificateholders and the Certificate Insurer that such substitution has taken
place, shall amend the Mortgage Loan Schedule to reflect the removal of such
Defective Mortgage Loan from the
56
terms of this Agreement and the substitution of the Eligible Substitute Mortgage
Loan or Loans and shall deliver a copy of such amended Mortgage Loan Schedule to
the Trustee. Upon such substitution, such Eligible Substitute Mortgage Loan or
Loans shall constitute part of the Mortgage Pool and shall be subject in all
respects to the terms of this Agreement and, in the case of a substitution
effected by the Seller, the Mortgage Loan Purchase Agreement, and consistent
with the standard of care which the Servicer uses and/or would use in servicing
mortgage loans for its own account including, in the case of a substitution
effected by the Seller all applicable representations and warranties thereof
included in the Mortgage Loan Purchase Agreement and all applicable
representations and warranties thereof set forth in Section 2.04, in each case
as of the date of substitution.
For any month in which the Seller substitutes one or more Eligible
Substitute Mortgage Loans for one or more Defective Mortgage Loans, the Servicer
will determine the amount (the "Substitution Adjustment Amount"), if any, by
which the aggregate Purchase Price of all such Defective Mortgage Loans exceeds
the aggregate, as to each such Eligible Substitute Mortgage Loan, of the
principal balance thereof as of the date of substitution, together with one
month's interest on such principal balance at the applicable Net Mortgage
Interest Rate. On the date of such substitution, the Seller will deliver or
cause to be delivered to the Servicer for deposit in the Collection Account an
amount equal to the Substitution Adjustment Amount, if any, and the Trustee,
upon receipt of the related Eligible Substitute Mortgage Loan or Loans and
certification by the Servicer of such deposit, shall release to the Seller the
related Mortgage File or Files and shall execute and deliver such instruments of
transfer or assignment, in each case without recourse, as the Seller shall
deliver to it and as shall be necessary to vest therein any Defective 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 the Trust Fund, including without
limitation, any federal tax imposed on "prohibited transactions" under Section
860F(a)(l) of the Code or on "contributions after the startup date" under
Section 860G(d)(l) of the Code, or (b) any REMIC formed under this Agreement to
fail to qualify as a REMIC at any time that any Certificate is outstanding. If
such Opinion of Counsel can not be delivered, then such substitution may only be
effected at such time as the required Opinion of Counsel can be given.
(e) Upon discovery by the Seller, the 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 Business Days give written notice thereof to the other parties. In
connection therewith, the Seller shall repurchase or, subject to the limitations
set forth in Section 2.03(d), substitute one or more Eligible Substitute
Mortgage Loans for the affected Mortgage Loan within 90 days of the earlier of
discovery or receipt of such notice with respect to such affected Mortgage Loan.
In addition, upon discovery that a Mortgage Loan is defective in a manner that
would cause it to be a "defective obligation" within the meaning of Treasury
regulations relating to REMICs, the Seller shall cure the defect or make the
required purchase or substitution no later than 90 days after the discovery of
the defect. Any such repurchase or substitution shall be made in the same manner
as set forth in Section 2.03(a), if made by the Seller. The Trustee shall
reconvey to the Seller the Mortgage
57
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.
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 pursuant to
Sections 2.01, 2.02 and 2.03 and preparation and delivery of the certifications
in the form of Exhibit F-1 and Exhibit F-2 shall be performed by the Custodian
pursuant to the terms and conditions of the Custodial Agreement. The fees and
expenses of the Custodian shall be paid by the Servicer.
Section 2.04 Representations and Warranties of the Seller with Respect to
the Mortgage Loans.
The Seller hereby represents and warrants to the Trustee for the benefit
of the Certificateholders that as of the Closing Date or as of such other date
specifically provided herein:
(a) The representations and warranties made by the Seller pursuant
to Section 3.01 of the Mortgage Loan Purchase Agreement are hereby being made to
the Trustee and are true and correct as of the Closing Date.
(b) Any written agreement between the Mortgagor in respect of a
Mortgage Loan and the Servicer modifying such Mortgagor's obligation to make
payments under the Mortgage Loan (such modified Mortgage Loan, a "Modified
Mortgage Loan") involved the application of the Seller's underwriting standards
or some assessment of the Mortgagor's ability to repay the Modified Mortgage
Loan.
With respect to the representations and warranties set forth in this
Section 2.04 that are made to the best of the Seller's knowledge or as to which
the Seller has no knowledge, if it is discovered by the Depositor, the Seller,
the Servicer or the Trustee that the substance of such representation and
warranty is inaccurate and such inaccuracy materially and adversely affects the
value of the related Mortgage Loan or the interest therein of the
Certificateholders then, notwithstanding the Seller's lack of knowledge with
respect to the substance of such representation and warranty being inaccurate at
the time the representation or warranty was made, such inaccuracy shall be
deemed a breach of the applicable representation or warranty.
Upon discovery by the Depositor, the Seller, the Servicer or the Trustee
of a breach of any of the representations and warranties contained in this
Section that materially and adversely affects the value of any Mortgage Loan or
the interest therein of the Certificateholders, the party discovering the breach
shall give prompt written notice to the others and in no event later than two
Business Days from the date of such discovery. Within ninety days of its
discovery or its receipt of notice of any such missing or materially defective
documentation or any such breach of a representation or warranty, the Seller
shall promptly deliver such missing document or cure such defect or breach in
all material respects, or in the event such defect or breach cannot be cured,
the Seller shall repurchase the affected Mortgage Loan or cause the removal of
such Mortgage Loan from the Trust Fund and substitute for it one or more
Eligible Substitute Mortgage Loans, in either case, in accordance with Section
2.03.
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It is understood and agreed that the representations and warranties set
forth in this Section 2.04 shall survive delivery of the Mortgage Files to the
Trustee and shall inure to the benefit of the Certificateholders and the
Certificate Insurer notwithstanding any restrictive or qualified endorsement or
assignment. It is understood and agreed that the obligations of the Seller set
forth in Section 2.03(a) and (c) to cure, substitute for or repurchase a
Mortgage Loan pursuant to the Mortgage Loan Purchase Agreement and to reimburse
the Trust the Reimbursement Amount, constitute the sole remedies available to
the Certificateholders or to the Trustee on their behalf respecting a breach of
the representations and warranties contained in this Section 2.04.
Section 2.05 Representations, Warranties and Covenants of the Servicer.
The Servicer hereby represents, warrants and covenants to the Trustee, for
the benefit of each of the Trustee and the Certificateholders and to the
Depositor that as of the Closing Date or as of such date specifically provided
herein:
(i) The Servicer is duly organized, validly existing, and in
good standing under the laws of the jurisdiction of its formation and has all
licenses necessary to carry on its business as now being conducted, except for
such licenses, certificates and permits the absence of which, individually or in
the aggregate, would not have a material adverse effect on the ability of the
Servicer to conduct its business as it is presently conducted, and is licensed,
qualified and in good standing in the states where the Mortgaged Property is
located if the laws of such state require licensing or qualification in order to
conduct business of the type conducted by the Servicer or to ensure the
enforceability or validity of each Mortgage Loan; the Servicer has the power and
authority to execute and deliver this Agreement and to perform in accordance
herewith; the execution, delivery and performance of this Agreement (including
all instruments of transfer to be delivered pursuant to this Agreement) by the
Servicer and the consummation of the transactions contemplated hereby have been
duly and validly authorized; this Agreement evidences the valid, binding and
enforceable obligation of the Servicer, subject to applicable bankruptcy,
insolvency, reorganization, moratorium or other similar laws affecting the
enforcement of creditors' rights generally; and all requisite corporate action
has been taken by the Servicer to make this Agreement valid and binding upon the
Servicer in accordance with its terms;
(ii) The consummation of the transactions contemplated by this
Agreement are in the ordinary course of business of the Servicer and will not
result in the breach of any term or provision of the certificate of formation or
the partnership agreement of the Servicer or result in the breach of any term or
provision of, or conflict with or constitute a default under or result in the
acceleration of any obligation under, any agreement, indenture or loan or credit
agreement or other instrument to which the Servicer or its property is subject,
or result in the violation of any law, rule, regulation, order, judgment or
decree to which the Servicer or its property is subject;
(iii) The Servicer is an approved seller/servicer of
conventional mortgage loans for ▇▇▇▇▇▇ ▇▇▇ and is an FHA Approved Mortgagee in
good standing to service mortgages, is a VA Approved Lender and has not been
suspended as a mortgagee or servicer by the FHA or VA and has the facilities,
procedures and experienced personnel necessary for the sound servicing of
mortgage loans of the same type as the Mortgage Loans. The Servicer is, and
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shall remain for as long as it is servicing the Mortgage Loans hereunder, in
good standing as a FHA Approved Mortgagee and a VA Approved Lender and to
service mortgage loans for HUD, ▇▇▇▇▇▇ Mae or ▇▇▇▇▇▇▇ Mac, and no event has
occurred, including but not limited to a change in insurance coverage, which
would make the Servicer unable to comply with HUD, ▇▇▇▇▇▇ Mae, ▇▇▇▇▇▇▇ Mac or
FHA eligibility requirements or which would require notification to any of HUD,
▇▇▇▇▇▇ Mae, ▇▇▇▇▇▇▇ Mac, FHA or VA;
(iv) This Agreement, and all documents and instruments
contemplated hereby which are executed and delivered by the Servicer, constitute
and will constitute valid, legal and binding obligations of the Servicer,
enforceable in accordance with their respective terms, except as the enforcement
thereof may be limited by applicable bankruptcy laws and general principles of
equity;
(v) The Servicer does not believe, nor does it have any reason
or cause to believe, that it cannot perform each and every covenant contained in
this Agreement;
(vi) There is no action, suit, proceeding or investigation
pending or, to its knowledge, threatened against the Servicer that, either
individually or in the aggregate, may result in any material adverse change in
the business, operations, financial condition, properties or assets of the
Servicer, or in any material impairment of the right or ability of the Servicer
to carry on its business substantially as now conducted, or in any material
liability on the part of the Servicer, or that would draw into question the
validity or enforceability of this Agreement or of any action taken or to be
taken in connection with the obligations of the Servicer contemplated herein, or
that would be likely to impair materially the ability of the Servicer to perform
under the terms of this Agreement;
(vii) No consent, approval or order of any court or
governmental agency or body is required for the execution, delivery and
performance by the Servicer of or compliance by the Servicer with this Agreement
or the consummation of the transactions contemplated by this Agreement, except
for such consents, approvals, authorizations and orders, if any, that have been
obtained;
(viii) Neither this Agreement nor any information, certificate
of an officer, statement furnished in writing or report delivered to the Trustee
by the Servicer in connection with the transactions contemplated hereby contains
or will contain any untrue statement of a material fact or omits or will omit to
state a material fact necessary in order to make the statements contained
therein, in light of the circumstances under which they were made, not
misleading; and
(ix) The Servicer has fully furnished, and shall continue to
fully furnish for so long as it is servicing the Mortgage Loans hereunder, in
accordance with the Fair Credit Reporting Act and its implementing regulations,
accurate and complete information on the Mortgagor credit files to Equifax,
Experian and Trans Union Credit Information Company on a monthly basis.
It is understood and agreed that the representations, warranties and
covenants set forth in this Section 2.05 shall survive delivery of the Mortgage
Files to the Trustee and shall inure to the
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benefit of the Trustee, the Depositor, the Certificateholders and the
Certificate Insurer. Upon discovery by any of the Depositor, the Servicer, the
Seller or the Trustee of a breach of any of the foregoing representations,
warranties and covenants which materially and adversely affects the value of any
Mortgage Loan or the interests therein of the Certificateholders or the
Certificate Insurer, the party discovering such breach shall give prompt written
notice (but in no event later than two Business Days following such discovery)
to the other parties hereto.
Section 2.06 Representations and Warranties of the Depositor.
The Depositor represents and warrants to the Trust and the Trustee on
behalf of the Certificateholders as follows:
(i) This agreement constitutes a legal, valid and binding
obligation of the Depositor, enforceable against the Depositor in accordance
with its terms, except as enforceability may be limited by applicable
bankruptcy, insolvency, reorganization, moratorium or other similar laws now or
hereafter in effect affecting the enforcement of creditors' rights in general
and except as such enforceability may be limited by general principles of equity
(whether considered in a proceeding at law or in equity);
(ii) Immediately prior to the sale and assignment by the
Depositor to the Trustee on behalf of the Trust of each Mortgage Loan, the
Depositor had good and marketable title to each Mortgage Loan (insofar as such
title was conveyed to it by the Seller) subject to no prior lien, claim,
participation interest, mortgage, security interest, pledge, charge or other
encumbrance or other interest of any nature;
(iii) As of the Closing Date, the Depositor has transferred
all right, title interest in the Mortgage Loans to the Trustee on behalf of the
Trust;
(iv) The Depositor has not transferred the Mortgage Loans to
the Trustee on behalf of the Trust with any intent to hinder, delay or defraud
any of its creditors;
(v) The Depositor has been duly incorporated and is validly
existing as a corporation in good standing under the laws of the State of
Delaware, with full corporate power and authority to own its assets and conduct
its business as presently being conducted;
(vi) The Depositor is not in violation of its certificate of
incorporation or by-laws or in default in the performance or observance of any
material obligation, agreement, covenant or condition contained in any contract,
indenture, mortgage, loan agreement, note, lease or other instrument to which
the Depositor is a party or by which it or its properties may be bound, which
default might result in any material adverse changes in the financial condition,
earnings, affairs or business of the Depositor or which might materially and
adversely affect the properties or assets, taken as a whole, of the Depositor;
(vii) The execution, delivery and performance of this
Agreement by the Depositor, and the consummation of the transactions
contemplated thereby, do not and will not result in a material breach or
violation of any of the terms or provisions of, or, to the knowledge of the
Depositor, constitute a default under, any indenture, mortgage, deed of trust,
loan agreement or other agreement or instrument to which the Depositor is a
party or by which the
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Depositor is bound or to which any of the property or assets of the Depositor is
subject, nor will such actions result in any violation of the provisions of the
certificate of incorporation or by-laws of the Depositor or, to the best of the
Depositor's knowledge without independent investigation, any statute or any
order, rule or regulation of any court or governmental agency or body having
jurisdiction over the Depositor or any of its properties or assets (except for
such conflicts, breaches, violations and defaults as would not have a material
adverse effect on the ability of the Depositor to perform its obligations under
this Agreement);
(viii) To the best of the Depositor's knowledge without any
independent investigation, no consent, approval, authorization, order,
registration or qualification of or with any court or governmental agency or
body of the United States or any other jurisdiction is required for the issuance
of the Certificates, or the consummation by the Depositor of the other
transactions contemplated by this Agreement, except such consents, approvals,
authorizations, registrations or qualifications as (a) may be required under
State securities or Blue Sky laws, (b) have been previously obtained or (c) the
failure of which to obtain would not have a material adverse effect on the
performance by the Depositor of its obligations under, or the validity or
enforceability of, this Agreement; and
(ix) There are no actions, proceedings or investigations
pending before or, to the Depositor's knowledge, threatened by any court,
administrative agency or other tribunal to which the Depositor is a party or of
which any of its properties is the subject: (a) which if determined adversely to
the Depositor would have a material adverse effect on the business, results of
operations or financial condition of the Depositor; (b) asserting the invalidity
of this Agreement or the Certificates; (c) seeking to prevent the issuance of
the Certificates or the consummation by the Depositor of any of the transactions
contemplated by this Agreement, as the case may be; (d) which might materially
and adversely affect the performance by the Depositor of its obligations under,
or the validity or enforceability of, this Agreement.
Section 2.07 Issuance of Certificates and the Uncertificated Regular
Interests.
The Trustee acknowledges the assignment to it of the Mortgage Loans and
the delivery to it (or the Custodian, as bailee and Custodian of the Trustee) of
the Mortgage Files, subject to the provisions of Sections 2.01 and 2.02, and the
Trustee acknowledges the assignment to it of all other assets included in the
Trust Fund, receipt of which is hereby acknowledged. Concurrently with such
assignment and delivery and in exchange therefor, the Trustee, pursuant to the
Written Order to Authenticate executed by an officer of the Depositor, has
executed, and the Certificate Registrar has authenticated and delivered to or
upon the order of the Depositor, the Certificates (other than the Class X and
Residual Certificates) in minimum dollar denominations or $25,000 and integral
dollar multiples of $1 in excess. The Class X and Class R Certificates are
issuable only in minimum Percentage Interests of 10%. The Class R-X Certificates
are issuable only in minimum Percentage Interests of 50%. The Trustee
acknowledges the issuance of the uncertificated REMIC 1 Regular Interests, the
uncertificated REMIC 2 Regular Interests, the uncertificated REMIC 4 Regular
Interests, the uncertificated REMIC 5 Regular Interests, the uncertificated
REMIC 6 Regular Interests, the uncertificated REMIC 7 Regular Interests, the
uncertificated REMIC 8 Regular Interests and the uncertificated REMIC 9 Regular
Interests and declares that it holds the REMIC 1 Regular Interests as assets of
REMIC 2, the REMIC 2 AF-3 Interest as the asset of REMIC 3, the REMIC 2 M-3
Interest as the asset of REIMC 4, the
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REMIC 2 B-1 Interest as the asset of REMIC 5, the REMIC 2 B-2 Interest as the
asset of REMIC 6, the REMIC 2 B-3 Interest as the asset of REMIC 7, the REMIC 2
B-4 Interest as the asset of REMIC 8 and the REMIC 2 X/N Interest as the asset
of REMIC 9. The Trustee acknowledges the issuance of the uncertificated REMIC 9
X/N Interest, beneficial ownership of which is evidenced by the Class X/N
Interest, and declares that it holds the same as assets of the Grantor Trust on
behalf of the Holders of the Class N and Class X Certificates. The interests
evidenced by the Certificates constitute the entire beneficial ownership
interest in the Trust Fund.
Section 2.08 Representations and Warranties of the Seller.
The Seller hereby represents and warrants to the Trust and the Trustee on
behalf of the Certificateholders that as of the Closing Date or as of such date
specifically provided herein:
(i) The Seller is duly organized, validly existing and in good
standing as a limited liability company under the laws of the State of Delaware
and has the power and authority to own its assets and to transact the business
in which it is currently engaged. The Seller is duly qualified to do business
and is in good standing in each jurisdiction in which the character of the
business transacted by it or properties owned or leased by it requires such
qualification and in which the failure to so qualify would have a material
adverse effect on (a) its business, properties, assets or condition (financial
or other), (b) the performance of its obligations under this Agreement, (c) the
value or marketability of the Mortgage Loans, or (d) its ability to foreclose on
the related Mortgaged Properties.
(ii) The Seller has the power and authority to make, execute,
deliver and perform this Agreement and to consummate all of the transactions
contemplated hereunder and has taken all necessary action to authorize the
execution, delivery and performance of this Agreement. When executed and
delivered, this Agreement will constitute the Seller's legal, valid and binding
obligations enforceable in accordance with its terms, except as enforcement of
such terms may be limited by (1) bankruptcy, insolvency, reorganization,
receivership, moratorium or similar laws affecting the enforcement of creditors'
rights generally and by the availability of equitable remedies, (2) general
equity principles (regardless of whether such enforcement is considered in a
proceeding in equity or at law) or (3) public policy considerations underlying
the securities laws, to the extent that such policy considerations limit the
enforceability of the provisions of this Agreement which purport to provide
indemnification from securities laws liabilities.
(iii) The Seller holds all necessary licenses, certificates
and permits from all governmental authorities necessary for conducting its
business as it is presently conducted, except for such licenses, certificates
and permits the absence of which, individually or in the aggregate, would not
have a material adverse effect on the ability of the Seller to conduct its
business as it is presently conducted. It is not required to obtain the consent
of any other party or any consent, license, approval or authorization from, or
registration or declaration with, any governmental authority, bureau or agency
in connection with the execution, delivery, performance, validity or
enforceability of this Agreement, except for such consents, licenses, approvals
or authorizations, or registrations or declarations as shall have been obtained
or filed, as the case may be, prior to the Closing Date.
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(iv) The execution, delivery and performance of this Agreement
by the Seller will not conflict with or result in a breach of, or constitute a
default under, any provision of any existing law or regulation or any order or
decree of any court applicable to the Seller or any of its properties or any
provision of its Limited Liability Company Agreement, or constitute a material
breach of, or result in the creation or imposition of any lien, charge or
encumbrance upon any of its properties pursuant to any mortgage, indenture,
contract or other agreement to which it is a party or by which it may be bound.
(v) No certificate of an officer, written statement or report
delivered pursuant to the terms hereof by the Seller contains any untrue
statement of a material fact or omits to state any material fact necessary to
make the certificate, statement or report not misleading.
(vi) The transactions contemplated by this Agreement are in
the ordinary course of the Seller's business.
(vii) The Seller is not insolvent, nor will the Seller be made
insolvent by the transfer of the Mortgage Loans to the Depositor, nor is the
Seller aware of any pending insolvency.
(viii) The Seller is not in violation of, and the execution
and delivery of this Agreement by it and its performance and compliance with the
terms of this Agreement will not constitute a violation with respect to any
order or decree of any court, or any order or regulation of any federal, state,
municipal or governmental agency having jurisdiction, which violation would
materially and adversely affect the Seller's condition (financial or otherwise)
or operations or any of the Seller's properties, or materially and adversely
affect the performance of any of its duties hereunder.
(ix) There are no actions or proceedings against, or
investigations of, the Seller pending or, to its knowledge, threatened, before
any court, administrative agency or other tribunal (i) that, if determined
adversely, would prohibit the Seller from entering into this Agreement, (ii)
seeking to prevent the consummation of any of the transactions contemplated by
this Agreement or (iii) that, if determined adversely, would prohibit or
materially and adversely affect the Seller's performance of any of its
respective obligations under, or the validity or enforceability of, this
Agreement.
(x) The Seller did not transfer the Mortgage Loans to the
Depositor with any intent to hinder, delay or defraud any of its creditors.
(xi) The Seller acquired title to the Mortgage Loans in good
faith, without notice of any adverse claims.
(xii) The transfer, assignment and conveyance of the Mortgage
Notes and the Mortgages by the Seller to the Depositor are not subject to the
bulk transfer laws or any similar statutory provisions in effect in any
applicable jurisdiction.
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Section 2.09 Covenants of the Seller.
(a) The Seller hereby covenants that except for the transfer
hereunder, the Seller will not sell, pledge, assign or transfer to any other
Person, or grant, create, incur, assume or suffer to exist any lien on any
Mortgage Loan, or any interest therein; the Seller will notify the Trustee, as
assignee of the Depositor, of the existence of any lien on any Mortgage Loan
immediately upon discovery thereof, and the Seller will defend the right, title
and interest of the Trust, as assignee of the Depositor, in, to and under the
Mortgage Loans, against all claims of third parties claiming through or under
the Seller; provided, however, that nothing in this Section 2.09 shall prevent
or be deemed to prohibit the Seller from suffering to exist upon any of the
Mortgage Loans any liens for municipal or other local taxes and other
governmental charges if such taxes or governmental charges shall not at the time
be due and payable or if the Seller shall currently be contesting the validity
thereof in good faith by appropriate proceedings and shall have set aside on its
books adequate reserves with respect thereto.
(b) The Seller hereby covenants that neither it nor any
Affiliate of the Seller will directly solicit any Mortgagor hereunder to
refinance the related Mortgage Loan. For the purposes of the foregoing, neither
the Seller nor any Affiliate of the Seller shall be deemed to directly solicit
any Mortgagor if the Seller responds to a request from a Mortgagor regarding a
refinancing or if the Mortgagor receives marketing materials which are generally
disseminated.
ARTICLE III
ADMINISTRATION AND SERVICING
OF THE TRUST FUND
Section 3.01 Servicer to Act as Servicer.
The Servicer, as independent contract servicer, shall service and
administer the Mortgage Loans in accordance with this Agreement and the normal
and usual standards of practice of prudent mortgage servicers, and shall have
full power and authority, acting alone, to do or cause to be done any and all
things in connection with such servicing and administration which the Servicer
may deem necessary or desirable and consistent with the terms of this Agreement
and consistent with the standard of care which the Servicer uses and/or would
use in servicing mortgage loans for its own account including, in the case of
FHA Loans and the VA Loans, taking all actions that a mortgagee is permitted or
required to take by the FHA or VA, as applicable (the "Servicing Standards").
Consistent with the terms of this Agreement, the Servicer may waive,
modify or vary any term of any Mortgage Loan or consent to the postponement of
strict compliance with any such term or in any manner grant indulgence to any
Mortgagor if in the Servicer's reasonable and prudent determination such waiver,
modification, postponement or indulgence is not materially adverse to the
Certificateholders or the Certificate Insurer; provided, however, that the
Servicer shall not make future advances and (unless the Mortgagor is in default
with respect to the Mortgage Loan or such default is, in the judgment of the
Servicer, reasonably foreseeable) the Servicer shall not permit any modification
with respect to any Mortgage Loan that would (i) change the Mortgage Interest
Rate, defer or forgive the payment thereof of any principal or
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interest payments, reduce the outstanding principal amount (except for actual
payments of principal) or extend the final maturity date with respect to such
Mortgage Loan, (ii) in the case of FHA Loans, affect the FHA Insurance Contract
with respect to such Mortgage Loan and in the case of the VA Loans, affect the
VA Guaranty with respect to such Mortgage Loan, (iii) affect adversely the
status of any REMIC constituting part of the Trust Fund as a REMIC or (iv) cause
any REMIC to be subject to a tax on "prohibited transactions" or "contributions"
pursuant to the REMIC Provisions. Notwithstanding the foregoing, the Servicer
shall not permit any modification with respect to any Mortgage Loan that would
both (x) effect an exchange or reissuance of such Mortgage Loan under Section
1.860G-2(b) of the Treasury Regulations and (y) cause any REMIC constituting
part of the Trust Fund to fail to qualify as a REMIC under the Code or the
imposition of any tax on "prohibited transactions" or "contributions" after the
Startup Day under the REMIC Provisions. Without limiting the generality of the
foregoing, the Servicer shall continue, and is hereby authorized and empowered
to execute and deliver on behalf of itself, and the Trustee, all instruments of
satisfaction or cancellation, or of partial or full release, discharge and all
other comparable instruments, with respect to the Mortgage Loans and with
respect to the Mortgaged Property. The Servicer shall make all required
Servicing Advances and shall service and administer the Mortgage Loans in
accordance with Applicable Regulations, and shall provide to the Mortgagors any
reports required to be provided to them thereby. If reasonably required by the
Servicer, the Trustee shall furnish the Servicer a power of attorney
(substantially in the form annexed hereto as Exhibit Q) and other documents
necessary or appropriate to enable the Servicer to carry out its servicing and
administrative duties under this Agreement.
In servicing and administering FHA Loans, the Servicer shall comply
strictly with the National Housing Act, the FHA Regulations, the Servicemen's
Readjustment Act and administrative guidelines issued thereunder or pursuant
thereto (insofar as the same apply to any Mortgage Loan) and, to the extent
permitted hereunder, promptly discharge all of the obligations of the mortgagee
thereunder and under each Mortgage including the timely giving of notices, the
essence hereof being that the full benefits of each FHA Insurance Contract inure
to the Trustee, on behalf of the Certificateholders.
In servicing and administering the Mortgage Loans, the Servicer shall
employ procedures including collection procedures and exercise the same care
that it customarily employs and exercises in servicing and administering
mortgage loans for its own account giving due consideration to accepted mortgage
servicing practices of prudent lending institutions and the FHA Insurance
Contracts and the Certificateholders' reliance on the Servicer.
The Servicer shall give prompt notice to the Trustee of any action, of
which the Servicer has actual knowledge, which action purports to (i) assert a
claim against the Trust Fund or (ii) assert jurisdiction over the Trust Fund.
Notwithstanding anything in this Agreement to the contrary, in the event
of a Principal Prepayment in full, the Servicer may not waive any prepayment
penalty or portion thereof required by the terms of the related Mortgage Note
unless (i) the related Mortgage Loan is in default or foreseeable default and
such waiver (a) is standard and customary in servicing mortgage loans similar to
the Mortgage Loans and (b) would, in the reasonable judgment of the Servicer,
maximize recovery of total proceeds taking into account the value of such
prepayment
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penalty and the related Mortgage Loan, (ii) (A) the enforceability thereof is
limited (1) by bankruptcy, insolvency, moratorium, receivership, or other
similar law relating to creditors' rights generally or (2) due to acceleration
in connection with a foreclosure or other involuntary payment, or (B) the
enforceability is otherwise limited or prohibited by applicable law, or (iii)
the Servicer has not been provided with information sufficient to enable it to
collect the prepayment penalty. For the avoidance of doubt, the Servicer may
waive a prepayment penalty in connection with a short sale or short payoff on a
defaulted Mortgage Loan. If the Servicer has waived all or a portion of a
prepayment penalty relating to a Principal Prepayment, other than as provided
above, the Servicer shall deliver to the Trustee no later than the next
succeeding Servicer Remittance Date, for deposit into the Distribution Account
the amount of such prepayment penalty (or such portion thereof as had been
waived) for distribution in accordance with the terms of this Agreement.
The Trustee shall prepare and deliver to the Depositor and the owners of
the Class N and Class X Certificates, on a monthly basis, a statement setting
forth the amounts received with respect to prepayment penalties.
Section 3.02 Collection of Mortgage Loan Payments.
Continuously from the date hereof until the principal and interest on all
Mortgage Loans are paid in full, the Servicer will diligently collect all
payments due under each Mortgage Loan when the same shall become due and payable
and shall, to the extent such procedures shall be consistent with this Agreement
and the terms and provisions of any related Primary Insurance Policy and
Applicable Regulations, follow such collection procedures as it follows with
respect to mortgage loans comparable to the Mortgage Loans and held for its own
account. Further, the Servicer will take special care in ascertaining and
estimating annual ground rents, taxes, assessments, water rates, fire and hazard
insurance premiums, mortgage insurance premiums, and all other charges that, as
provided in the Mortgage, will become due and payable to that end that the
installments payable by the Mortgagors will be sufficient to pay such charges as
and when they become due and payable.
Section 3.03 Realization Upon Defaulted Mortgage Loans.
In the event that any payment due under any Conventional Mortgage Loan is
not paid when the same becomes due and payable, or in the event the Mortgagor
fails to perform any other covenant or obligation under the Mortgage Loan and
such failure continues beyond any applicable grace period, the Servicer shall
take such action as it shall deem to be in the best interest of the
Certificateholders and the Certificate Insurer. In the event that any payment
due under any FHA Loan becomes delinquent, the Servicer shall take all such
actions as are in the best interests of the Certificateholders and the
Certificate Insurer and permitted under any applicable FHA loss mitigation
proceedings, including, but not limited to, requesting the FHA to accept an
assignment of such FHA Loan, and, upon the Servicer's determination that
foreclosure is in the best interest of the Certificateholders and the
Certificate Insurer, commencing foreclosure proceedings. With respect to any
defaulted Mortgage Loan, the Servicer shall have the right to review the status
of the related forbearance plan and, subject to the second paragraph of Section
3.01, may modify such forbearance plan; including, extending the Mortgage Loan
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repayment date for a period of one year or reducing the Mortgage Interest Rate
up to 50 basis points.
In connection with a foreclosure or other conversion, the Servicer shall
exercise such rights and powers vested in it hereunder and use the same degree
of care and skill in its exercise as prudent mortgage servicers would exercise
or use under the circumstances in the conduct of their own affairs and
consistent with Applicable Regulations and the servicing standards set forth in
the ▇▇▇▇▇▇ ▇▇▇ Guide, including, without limitation, advancing funds for the
payment of taxes and insurance premiums with respect to first lien Mortgage
Loans.
Notwithstanding the foregoing provisions of this Section 3.03, with
respect to any Mortgage Loan as to which the Servicer has received actual notice
of, or has actual knowledge of, the presence of any toxic or hazardous substance
on the related Mortgaged Property, the Servicer shall not 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 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 the Servicer
has also previously determined, based on its reasonable judgment and a prudent
report prepared by a Person who regularly conducts environmental audits using
customary industry standards, that:
A. such Mortgaged Property is in compliance with applicable environmental
laws or, if not, that it would be in the best economic interest of the
Certificateholders and the Certificate Insurer to take such actions as are
necessary to bring the Mortgaged Property into compliance therewith; and
B. 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 Certificateholders and the
Certificate Insurer to take such actions with respect to the affected Mortgaged
Property.
The cost of the environmental audit report contemplated by this Section
3.03 shall be advanced by the Servicer, subject to the Servicer's right to be
reimbursed therefor from the Collection Account as provided in Section 3.05(ii).
If the Servicer determines, as described above, that it is in the best
economic interest of the Certificateholders and the Certificate Insurer 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 the Servicer shall take such action as it
deems to be in the best economic interest of the Certificateholders and the
Certificate Insurer. The cost of any such
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compliance, containment, cleanup or remediation shall be advanced by the
Servicer, subject to the Servicer's right to be reimbursed therefor from the
Collection Account as provided in Section 3.05(ii).
Section 3.04 Collection Account and Distribution Account.
(a) The Servicer shall segregate and hold all funds collected and
received pursuant to each Mortgage Loan separate and apart from any of its own
funds and general assets and shall establish and maintain one or more Collection
Accounts. Each Collection Account shall be an Eligible Account.
The Servicer shall deposit in the Collection Account on a daily basis
within two Business Days of receipt, and retain therein, the following payments
and collections received or made by it after the Cut-off Date with respect to
the Mortgage Loans:
(i) all payments on account of principal, including Principal
Prepayments, on the Mortgage Loans;
(ii) all payments on account of interest on the Mortgage Loans
adjusted to the Mortgage Interest Rate less the Servicing Fee Rate;
(iii) all proceeds from a Cash Liquidation;
(iv) all Insurance Proceeds including amounts required to be
deposited pursuant to Section 3.10, other than proceeds to be held in the Escrow
Account and applied to the restoration or repair of the Mortgaged Property or
released to the Mortgagor in accordance with the Servicer's normal servicing
procedures, the loan documents or applicable law;
(v) all Condemnation Proceeds affecting any Mortgaged Property
which are not released to the Mortgagor in accordance with the Servicer's normal
servicing procedures, the loan documents or applicable law; and
(vi) any amounts required to be deposited by the Servicer in
connection with any REO Property pursuant to Section 3.13.
Any interest paid on funds deposited in the Collection Account, subject to
Section 3.25, shall accrue to the benefit of the Servicer and the Servicer shall
be entitled to retain and withdraw such interest from the Collection Account
pursuant to Section 3.05(v). The foregoing requirements for deposit from the
Collection Account shall be exclusive, it being understood and agreed that,
without limiting the generality of the foregoing, payments in the nature of late
payment charges, prepayment charges that are not prepayment penalties, and
assumption fees need not be deposited by the Servicer in the Collection Account.
(b) On behalf of the Trust Fund, the Trustee shall establish and
maintain one or more accounts (such account or accounts, the "Distribution
Account"), held in trust for the benefit of the Certificateholders. On behalf of
the Trust Fund, the Servicer shall deliver to the Trustee in immediately
available funds for deposit in the Distribution Account by the close of business
New York time on the Servicer Remittance Date, that portion of the Available
Funds
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(calculated without regard to the references in the definition thereof to
amounts that may be deposited to the Distribution Account from a different
source as provided herein) then on deposit in the Collection Account. Amounts in
the Distribution Account shall be deemed to be held on behalf of the related
REMICs and the Grantor Trust in accordance with the REMIC distributions set
forth in Section 4.08. Funds on deposit in the Distribution Account will remain
uninvested.
(c) Funds in the Collection Account may be invested in Permitted
Investments in accordance with the provisions set forth in Section 3.25. The
Servicer shall give notice to the Trustee certifying the location of the
Collection Account maintained by it when established and prior to any change
thereof. The Trustee shall give notice to the Servicer and the Depositor of the
location of the Distribution Account when established and prior to any change
thereof.
(d) In the event the Servicer shall deliver to the Trustee for
deposit in the Distribution Account any amount not required to be deposited
therein, it may at any time request that the Trustee withdraw such amount from
the Distribution Account and remit to the Servicer any such amount, any
provision herein to the contrary notwithstanding. In addition, the Servicer
shall deliver to the Trustee from time to time for deposit, and the Trustee
shall so deposit, in the Distribution Account in respect of REMIC 1:
(i) any Advances, as required pursuant to Section 4.07;
(ii) any Stayed Funds, as soon as permitted by the federal
bankruptcy court having jurisdiction in such matters;
(iii) any prepayment penalties or amounts in connection with
the waiver of such prepayment penalties, in each case required to be deposited
pursuant to Section 3.01;
(iv) any amounts required to be deposited in the Distribution
Account pursuant to Sections 2.03, 3.04, 3.15, 3.16, 3.23 or 4.07; and
(v) any amounts required to be deposited by the Servicer
pursuant to Section 3.11 in connection with the deductible clause in any blanket
hazard insurance policy, such deposit being made from the Servicer's own funds,
without reimbursement therefor.
(e) Promptly upon receipt of any Stayed Funds, whether from the
Servicer, a trustee in bankruptcy, or federal bankruptcy court or other source,
the Trustee shall notify the Servicer of such receipt and deposit such funds in
the Distribution Account, subject to withdrawal thereof as permitted hereunder.
Section 3.05 Permitted Withdrawals From the Collection Account.
The Servicer may, from time to time, withdraw from the Collection Account
for the following purposes:
(i) to remit to the Trustee for deposit in the Distribution
Account the amounts required to be so remitted pursuant to Section 3.04(b) or
permitted to be so remitted
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pursuant to the first sentence of Section 3.04(d) or clause (ii) of first
sentence of the second paragraph of Section 4.07(b);
(ii) to reimburse itself for (a) Advances and Servicing
Advances to the extent of amounts received on the related Mortgage Loan which
represent payments of (x) principal and/or interest respecting which any such
Advance was made or (y) Condemnation Proceeds, Insurance Proceeds or Liquidation
Proceeds respecting which any such Servicing Advance was made; or (b) any
unreimbursed Advances to the extent of funds held in the Collection Account for
future distributions that were not included in Available Funds for the preceding
Distribution Date; provided, however, any funds so applied will be replaced by
the Servicer by deposit in the Collection Account no later than one Business Day
prior to the Distribution Date on which such funds are required to be
distributed;
(iii) to reimburse itself for unreimbursed Servicing Advances,
any unpaid Servicing Fees and for unreimbursed Advances to the extent that such
amounts are deemed to be Nonrecoverable Advances and to reimburse itself for
such amounts to the extent that such amounts are nonrecoverable from the
disposition of the related REO Property or have been written-off pursuant to
Section 3.13 hereof;
(iv) to reimburse itself for any amounts paid pursuant to
Section 3.03 (and not otherwise previously reimbursed);
(v) to pay to itself as servicing compensation (a) any
interest earned on funds in the Collection Account (all such interest to be
withdrawn monthly not later than each Servicer Remittance Date) and (b) the
Servicing Fee from that portion of any payment or recovery as to interest to a
particular Mortgage Loan to the extent not retained pursuant to Section
3.04(ii);
(vi) to pay or reimburse itself for any amounts payable or
paid pursuant to Section 6.03 (and not otherwise previously reimbursed) and to
reimburse itself as set forth in Section 9.01(c); and
(vii) to clear and terminate the Collection Account upon the
termination of this Agreement.
The foregoing requirements for withdrawal from the Collection Account
shall be exclusive. In the event the Servicer shall deposit in the Collection
Account any amount not required to be deposited therein, it may at any time
withdraw such amount from the Collection Account, any provision herein to the
contrary notwithstanding.
Section 3.06 Establishment of Escrow Account; Deposits in Escrow Account.
The Servicer shall segregate and hold all funds collected and received
pursuant to each Mortgage Loan which constitute Escrow Payments separate and
apart from any of its own funds and general assets and shall establish and
maintain one or more Escrow Accounts, in the form of time deposit or demand
accounts. A copy of such letter agreement shall be furnished to the Trustee upon
request. The Escrow Account shall be an Eligible Account.
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The Servicer shall deposit in the Escrow Account on a daily basis within
two Business Days of receipt, and retain therein, (i) all Escrow Payments
collected on account of the Mortgage Loans, for the purpose of effecting timely
payment of any such items as required under the terms of this Agreement, and
(ii) all Insurance Proceeds which are to be applied to the restoration or repair
of any Mortgaged Property. The Servicer shall make withdrawals therefrom only to
effect such payments as are required under this Agreement, and for such other
purposes as shall be set forth in, or in accordance with, Section 3.07. The
Servicer shall be entitled to retain any interest paid on funds deposited in the
Escrow Account by the depository institution other than interest on escrowed
funds required by law to be paid to the Mortgagor and, to the extent required by
the related Mortgage Loan or Applicable Regulations, the Servicer shall pay
interest on escrowed funds to the Mortgagor notwithstanding that the Escrow
Account is non-interest bearing or that interest paid thereon is insufficient
for such purposes.
Section 3.07 Permitted Withdrawals From Escrow Account.
Withdrawals from the Escrow Account may be made by the Servicer (i) to
effect timely payments of ground rents, taxes, assessments, water rates, fire,
flood and hazard insurance premiums, Primary Insurance Policy premiums, if
applicable, and comparable items, (ii) to reimburse the Servicer for any
Servicing Advance made by the Servicer with respect to a related Mortgage Loan
but only from amounts received on the related Mortgage Loan which represent late
payments or Late Collections of Escrow Payments thereunder, (iii) to refund to
the Mortgagor any funds as may be determined to be overages, (iv) for transfer
to the Collection Account in accordance with the terms of this Agreement, (v)
for application to restoration or repair of the Mortgaged Property, (vi) to pay
to the Servicer, or to the Mortgagor to the extent required by the related
Mortgage Loan or Applicable Regulations, any interest paid on the funds
deposited in the Escrow Account, (vii) to clear and terminate the Escrow Account
on the termination of this Agreement, (viii) to transfer to the Collection
Account any insurance proceeds, or (ix) in the case of FHA Loans, for transfer
to the Collection Account, fire and hazard insurance proceeds and Escrow
Payments with respect to any Mortgage Loan where the FHA, as the case may be,
has directed application of such funds as a credit against the proceeds of the
FHA Insurance Contract. As part of its servicing duties, the Servicer shall pay
to the Mortgagor interest on funds in the Escrow Account, to the extent required
by the related Mortgage Loan or Applicable Regulations, and to the extent that
interest earned on funds in the Escrow Account is insufficient, shall pay such
interest from its own funds, without any reimbursement therefor.
In the event the Servicer shall deposit in the Escrow Account any amount
not required to be deposited therein, it may at any time withdraw such amount
from the Escrow Account, any provision herein to the contrary notwithstanding.
Section 3.08 Payment of Taxes, Insurance and Other Charges; Collections
Thereunder.
With respect to each first lien Mortgage Loan, the Servicer shall maintain
accurate records reflecting the status of ground rents, taxes, assessments,
water rates and other charges which are or may become a lien upon the Mortgaged
Property and the status of Primary Insurance Policy premiums and fire, flood and
hazard insurance coverage and shall obtain, from time to time, all bills for the
payment of such charges (including renewal premiums) and shall
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effect payment thereof prior to the applicable penalty or termination date and
at a time appropriate for securing maximum discounts allowable, employing for
such purpose deposits of the Mortgagor in the Escrow Account which shall have
been estimated and accumulated by the Servicer in amounts sufficient for such
purposes, as allowed under the terms of the Mortgage or Applicable Regulations.
To the extent that a Mortgage does not provide for Escrow Payments, the Servicer
shall (i) 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)
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 the Servicer receives notice of a tax lien with respect to the Mortgage Loan
being imposed, the Servicer will, 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. The Servicer 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 from its own
funds to effect such payments.
The Servicer, on behalf of the Trustee, as mortgagee, will maintain in
full force and effect (to the extent a Mortgage Loan has a Primary Insurance
Policy) a Primary Insurance Policy issued by a Qualified Insurer with respect to
each Mortgage Loan for which such coverage is required. Such coverage will be
maintained until the Combined Loan-to-Value Ratio of the related Mortgage Loan
is reduced to 80% or less. The Servicer will not cancel or refuse to renew any
Primary Insurance Policy in effect on the Closing Date that is required to be
kept in force under this Agreement unless a replacement Primary Insurance Policy
for such cancelled or non-renewed policy is obtained from and maintained with a
Qualified Insurer. The Servicer shall not take any action which would result in
non-coverage under any applicable Primary Insurance Policy of any loss which,
but for the actions of the Servicer, would have been covered thereunder. In
connection with any assumption or substitution agreement entered into or to be
entered into pursuant to Section 3.14, the Servicer shall promptly notify the
insurer under the related Primary Insurance Policy, if any, of such assumption
or substitution of liability in accordance with the terms of such policy and
shall take all actions which may be required by such insurer as a condition to
the continuation of coverage under the Primary Insurance Policy. If such Primary
Insurance Policy is terminated as a result of such assumption or substitution of
liability, the Servicer shall obtain a replacement Primary Insurance Policy as
provided above.
In connection with its activities as servicer, the Servicer agrees to
prepare and present, on behalf of itself and the Trustee, claims to the insurer
under any Primary Insurance Policy in a timely fashion in accordance with the
terms of such policies and, in this regard, to take such action as shall be
necessary to permit recovery under any Primary Insurance Policy respecting a
defaulted Mortgage Loan. Pursuant to Section 3.04, any amounts collected by the
Servicer under any Primary Insurance Policy shall be deposited in the Collection
Account, subject to withdrawal pursuant to Section 3.05.
Section 3.09 Transfer of Accounts.
The Servicer may transfer the Collection Account or the Escrow Account to
a different depository institution from time to time. Upon such transfer, the
Servicer shall deliver to the
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Trustee and the Depositor, a certification or letter agreement, as the case may
be, as required pursuant to Sections 3.04 and 3.06.
Section 3.10 Maintenance of Hazard Insurance.
The Servicer shall cause to be maintained for each first lien Mortgage
Loan 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 (i) the amount necessary to fully compensate for any
damage or loss to the improvements which are a part of such property on a
replacement cost basis, (ii) the Principal Balance of the Mortgage Loan, in each
case in an amount not less than such amount as is necessary to prevent the
Mortgagor and/or the Mortgagee from becoming a co-insurer or (iii) the amount
required under applicable HUD/FHA/VA regulations. If the Mortgaged Property is
in an area identified in the Federal Register by the Flood Emergency Management
Agency as having special flood hazards and flood insurance has been made
available, the Servicer will cause to be maintained a flood insurance policy
meeting the requirements of the current guidelines of the Federal Insurance
Administration with a generally acceptable insurance carrier, in an amount
representing coverage not less than the least of (i) the Principal Balance of
the Mortgage Loan, (ii) the maximum insurable value of the improvements securing
such Mortgage Loan or (iii) the maximum amount of insurance which is available
under the Flood Disaster Protection Act of 1973, as amended. The Servicer shall
also maintain on the REO Property for the benefit of the Certificateholders, (x)
fire and hazard insurance with extended coverage in an amount which is at least
equal to the replacement cost of the improvements which are a part of such
property, (y) public liability insurance and, (z) to the extent required and
available under the Flood Disaster Protection Act of 1973, as amended, flood
insurance in an amount as provided above. Any amounts collected by the Servicer
under any such policies other than amounts to be deposited in the Escrow Account
and applied to the restoration or repair of the Mortgaged Property or REO
Property, or released to the Mortgagor in accordance with the Servicer's normal
servicing procedures, shall be deposited in the Collection Account, subject to
withdrawal pursuant to Section 3.05. It is understood and agreed that no
earthquake or other additional insurance is required to be maintained by the
Servicer or the Mortgagor or maintained on property acquired in respect of the
Mortgage Loan, other than pursuant to such Applicable Regulations as shall at
any time be in force and as shall require such additional insurance. All such
policies shall be endorsed with standard mortgagee clauses with loss payable to
the Servicer and shall provide for at least thirty days prior written notice of
any cancellation, reduction in the amount of or material change in coverage to
the Servicer. The Servicer shall not interfere with the Mortgagor's freedom of
choice in selecting either his insurance carrier or agent, provided, however,
that the Servicer shall not accept any such insurance policies from insurance
companies unless such companies currently reflect a general policy rating of
B:VI or better in Best's Key Rating Guide and are licensed to do business in the
state wherein the property subject to the policy is located.
Section 3.11 Maintenance of Mortgage Impairment Insurance Policy.
In the event that the Servicer shall obtain and maintain a blanket policy
issued by an insurer that has a general policy rating of B:VI or better in
Best's Key Rating Guide insuring against hazard losses on all of the Mortgage
Loans, then, to the extent such policy provides coverage in an amount equal to
the amount required pursuant to Section 3.10 and otherwise
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complies with all other requirements of Section 3.10, it shall conclusively be
deemed to have satisfied its obligations as set forth in Section 3.10, it being
understood and agreed that such policy may contain a deductible clause, in which
case the Servicer shall, in the event that there shall not have been maintained
on the related Mortgaged Property or REO Property a policy complying with
Section 3.10, and there shall have been a loss which would have been covered by
such policy, deliver to the Trustee for deposit in the Distribution Account the
amount not otherwise payable under the blanket policy because of such deductible
clause, which amount shall not be reimbursable to the Servicer from the Trust
Fund. In connection with its activities as servicer of the Mortgage Loans, the
Servicer agrees to prepare and present, on behalf of the Trustee, claims under
any such blanket policy in a timely fashion in accordance with the terms of such
policy. Upon request of the Trustee, the Servicer shall cause to be delivered to
the Trustee a certified true copy of such policy and a statement from the
insurer thereunder that such policy shall in no event be terminated or
materially modified without thirty days prior written notice to the Trustee.
Section 3.12 Fidelity Bond, Errors and Omissions Insurance.
The Servicer shall maintain, at its own expense, a blanket fidelity bond
(the "Fidelity Bond") and an errors and omissions insurance policy, with broad
coverage with financially responsible companies on all officers, employees or
other persons acting in any capacity with regard to the Mortgage Loans to handle
funds, money, documents and papers relating to the Mortgage Loans. The Fidelity
Bond and errors and omissions insurance shall be in the form of the Mortgage
Banker's Blanket Bond and shall protect and insure the Servicer against losses,
including forgery, theft, embezzlement, fraud, errors and omissions and
negligent acts of such persons. Such Fidelity Bond shall also protect and insure
the Servicer against losses in connection with the failure to maintain any
insurance policies required pursuant to this Agreement and the release or
satisfaction of a Mortgage Loan without having obtained payment in full of the
indebtedness secured thereby. No provision of this Section 3.12 requiring the
Fidelity Bond and errors and omissions insurance shall diminish or relieve the
Servicer from its duties and obligations as set forth in this Agreement. The
minimum coverage under any such bond and insurance policy shall be at least
equal to the corresponding amounts required by ▇▇▇▇▇▇ ▇▇▇ in the ▇▇▇▇▇▇ Mae MBS
Selling and Servicing Guide or by ▇▇▇▇▇▇▇ Mac in the ▇▇▇▇▇▇▇ Mac Servicer's
Guide. Upon request of the Trustee, the Servicer shall cause to be delivered to
the requesting party a certified true copy of the Fidelity Bond and errors and
omissions insurance policy and a statement from the surety and the insurer that
such Fidelity Bond and errors and omissions insurance policy shall in no event
be terminated or materially modified without thirty days' prior written notice
to the Trustee.
Section 3.13 Title, Management and Disposition of REO Property and Certain
Delinquent Mortgage Loans.
(a) In the event that title to a Mortgaged Property is acquired in
foreclosure or by deed in lieu of foreclosure, the deed or certificate of sale
shall be taken (pursuant to a limited power of attorney to be provided by the
Trustee to the Servicer) in the name of the Trustee, on behalf of the
Certificateholders, or in the event the Trustee is not authorized or permitted
to hold title to real property in the state where the REO Property is located,
or would be adversely affected under the "doing business" or tax laws of such
state by so holding title, the deed or
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certificate of sale shall be taken in the name of such Person or Persons as
shall be consistent with an Opinion of Counsel obtained by the Servicer from an
attorney duly licensed to practice law in the state where the REO Property is
located. Any Person or Persons holding such title other than the Trustee shall
acknowledge in writing that such title is being held as nominee for the benefit
of the Trustee.
(b) In the event that the Trust Fund acquires any REO Property as
aforesaid or otherwise in connection with a default or imminent default on a
Mortgage Loan, the Servicer shall dispose of such REO Property before the end of
the third calendar year beginning after the year of its acquisition by the Trust
Fund for purposes of Section 860G(a)(8) of the Code or if the Trust Fund has
received (at the expense of the Trust Fund) from the Internal Revenue Service an
extension of the period during which it may hold such REO Property without such
REO Property failing to be treated as "foreclosure property" (within the meaning
of Section 860G(a)(8) of the Code), before the end of such extension, unless the
Servicer obtains an Opinion of Counsel, addressed to the Servicer and the
Trustee, to the effect that the holding by the Trust Fund of such REO Property
subsequent to such period will not: (i) result in the imposition of any tax on
"prohibited transactions" as defined in Section 860F of the Code; or (ii) cause
any REMIC constituting part of the Trust Fund 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 REO Property (subject to any conditions contained in such
Opinion of Counsel). The Servicer shall be entitled to be reimbursed from the
Collection Account for any costs incurred in obtaining such Opinion of Counsel,
as provided in Section 3.05.
Subject to compliance with applicable laws and regulations as shall at any
time be in force, and notwithstanding any other provisions of this Agreement, no
REO Property acquired by the Trust Fund shall be rented (or allowed to continue
to be rented) or otherwise used by or on behalf of the Trust Fund in such a
manner or pursuant to any terms that would: (i) cause such REO Property to fail
to qualify as "foreclosure property" within the meaning of Section 860G(a)(8) of
the Code; or (ii) subject any REMIC constituting part of the Trust Fund to the
imposition of any federal income taxes on the income earned from such REO
Property, including any taxes imposed by reason of Sections 860F or 860G(c) of
the Code, unless the Servicer has agreed to indemnify and hold harmless the
Trust Fund with respect to the imposition of any such taxes.
The Servicer shall manage, conserve, protect and operate each REO Property
for the Certificateholders and the Trust Fund 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 the related REMIC 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. The Servicer shall cause each REO Property
to be inspected promptly upon the acquisition of title thereto and shall cause
each REO Property to be inspected at least annually thereafter. The Servicer
shall make or cause to be made a written report of each such inspection. Such
reports shall be retained in the Mortgage Servicing File and copies thereof
shall be forwarded by the Servicer to the Trustee upon request. The Servicer
shall attempt to sell the same (and may temporarily rent the same) on such terms
and conditions as the Servicer deems to be in the best interest of the
Certificateholders and the Trust Fund.
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With respect to each REO Property, the Servicer shall account separately
for each REO Property with respect to all funds collected and received in
connection with the operation of such REO Property.
The Servicer shall deposit or cause to be deposited, on a daily basis,
within two Business Days of receipt, in the Collection Account, all revenues
received with respect to each REO Property and shall withdraw therefrom funds
necessary for the proper operation, management and maintenance of the related
REO Property, including the cost of maintaining any hazard insurance pursuant to
Section 3.10 hereof and the fees of any managing agent acting on behalf of the
Servicer.
The Servicer shall furnish to the Trustee, on each Servicer Remittance
Date, an operating statement for each REO Property covering the operation of
each REO Property for the previous month. Such operating statement shall be
accompanied by such other information as the Trustee shall reasonably request.
The Servicer shall use its best efforts to dispose of the REO Property as
promptly as is practically consistent with protecting the Certificateholders'
interests.
Each REO Disposition shall be carried out by the Servicer at such price
and upon such terms and conditions as the Servicer deems to be in the best
interest of the Certificateholders. If as of the date title to any REO Property
was acquired by the Servicer there were outstanding unreimbursed Servicing
Advances with respect to the REO Property or the related Mortgage Loan, the
Servicer, upon an REO Disposition of such REO Property, shall be entitled to
reimbursement for any related unreimbursed Servicing Advances from proceeds
received in connection with such REO Disposition. The proceeds from the REO
Disposition, net of any payment to the Servicer as provided above, shall be
deposited in the Collection Account for distribution on the succeeding Servicer
Remittance Date in accordance with Section 4.01.
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 and an Opinion of Counsel is obtained by the Servicer to the
effect that such sale shall not cause any REMIC constituting part of the Trust
Fund to fail to qualify as a REMIC).
(c) The Servicer may write-off any Second Lien Mortgage Loan that
has been Delinquent for a period of 180 days or more if the Servicer determines
that any amount that could be recovered on such Mortgage Loan would be less than
the cost required to achieve such recovery.
Section 3.14 Due-on-Sale Clauses; Assumption and Substitution Agreements.
When a Mortgaged Property has been or is about to be conveyed by the
Mortgagor, the Servicer shall, to the extent it has knowledge of such conveyance
or prospective conveyance, exercise its rights to accelerate the maturity of the
related Mortgage Loan under any "due-on-sale" clause contained in the related
Mortgage or Mortgage Note; provided, however, that the Servicer shall not
exercise any such right if the "due-on-sale" clause, in the reasonable belief of
the Servicer, is not enforceable under applicable law. An Opinion of Counsel at
the expense of the Servicer (which expense shall constitute a Servicing Advance)
delivered to the Trustee and
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the Depositor to the foregoing effect shall conclusively establish the
reasonableness of such belief. In such event, the Servicer shall make reasonable
efforts to enter into an assumption and modification agreement with the Person
to whom such property has been or is about to be conveyed, pursuant to which
such Person becomes liable under the Mortgage Note and, unless prohibited by
applicable law or the Mortgage, the Mortgagor remains liable thereon. If the
foregoing is not permitted under applicable law, the Servicer is 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 Mortgagor and becomes liable under the Note. In addition to the
foregoing, the Servicer shall not be required to enforce any "due-on-sale"
clause if, in the reasonable judgment of the Servicer, entering into an
assumption and modification agreement with a person to whom such Mortgaged
Property shall be conveyed and releasing the original Mortgagor from liability
would be in the best interests of the Certificateholders. The Mortgage Loan, as
assumed, shall conform in all respects to the requirements, representations and
warranties of this Agreement. The Servicer shall notify the Trustee that any
such assumption or substitution agreement has been completed by forwarding to
the Trustee (or the Custodian, as the case may be) the original copy of such
assumption or substitution agreement (indicating the Mortgage File to which it
relates) which copy shall be added by the Trustee (or the Custodian, as the case
may be) to the related Mortgage File and which 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. The Servicer shall be
responsible for recording any such assumption or substitution agreements. In
connection with any such assumption or substitution agreement, the Monthly
Payment on the related Mortgage Loan shall not be changed but shall remain as in
effect immediately prior to the assumption or substitution, the stated maturity
or outstanding principal amount of such Mortgage Loan shall not be changed nor
shall any required monthly payments of principal or interest be deferred or
forgiven. Any fee collected by the Servicer for consenting to any such
conveyance or entering into an assumption or substitution agreement shall be
retained by or paid to the Servicer as additional servicing compensation.
Notwithstanding the foregoing paragraph or any other provision of this
Agreement, the Servicer shall not be deemed to be in default, breach or any
other violation of its obligations hereunder by reason of any assumption of a
Mortgage Loan by operation of law or any assumption which the Servicer may be
restricted by law from preventing, for any reason whatsoever.
Section 3.15 Notification of Adjustments.
On each Adjustment Date, the Servicer shall make Mortgage Interest Rate
adjustments for each Group I Mortgage Loan in compliance with the requirements
of the related Mortgage and Mortgage Note and Applicable Regulations. The
Servicer shall execute and deliver the notices required by each Mortgage and
Mortgage Note and Applicable Regulations regarding Mortgage Interest Rate
adjustments. The Servicer also shall provide timely notification to the Trustee
of all applicable data and information regarding such Mortgage Interest Rate
adjustments and the Servicer's methods of implementing such Mortgage Interest
Rate adjustments. Upon the discovery by the Servicer, the Trustee that the
Servicer has failed to adjust or has incorrectly adjusted a Mortgage Interest
Rate or a Monthly Payment pursuant to the terms of the related Mortgage Note and
Mortgage, the Servicer shall deliver to the Trustee for deposit in the
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Distribution Account from its own funds the amount of any interest loss caused
thereby without reimbursement therefor; provided, however, the Servicer shall be
held harmless with respect to any Mortgage Interest Rate adjustments made by any
servicer prior to the Servicer.
Section 3.16 Optional Purchases of Mortgage Loans by Servicer.
The Servicer (or an affiliate of the Servicer) may, at its option,
repurchase a Mortgage Loan or REO Property which becomes 120 or more days
Delinquent or for which the Servicer has accepted a deed in lieu of foreclosure,
during the period commencing on the first day of the calendar quarter succeeding
the calendar quarter in which the Initial Delinquency Date occurred with respect
to such Mortgage Loan and ending on the last Business Day of such calendar
quarter. If the Servicer (or an affiliate of the Servicer) does not exercise its
purchase right with respect to a Mortgage Loan during the period specified in
the preceding sentence, such Mortgage Loan shall thereafter again become
eligible for purchase pursuant to the preceding sentence only after the Mortgage
Loan ceases to be 120 days or more Delinquent and thereafter becomes 120 days
Delinquent again. The "Initial Delinquency Date" of a Mortgage Loan shall mean
the date on which the Mortgage Loan first became 120 days Delinquent. Prior to
repurchase pursuant to this Section 3.16, the Servicer shall be required to
continue to make monthly advances pursuant to Section 4.07. The Servicer shall
not use any procedure in selecting Mortgage Loans to be repurchased which is
materially adverse to the interests of the Certificateholders. The Servicer
shall purchase such (i) delinquent Mortgage Loan at a price equal to the
Principal Balance of the Mortgage Loan plus accrued interest thereon at the
Mortgage Interest Rate from the date to which interest has last been paid to the
Trust Fund to the date of purchase plus any unreimbursed Servicing Advances and
Advances or (ii) REO Property at its fair market value as determined in good
faith by the Servicer. Any such repurchase of a Mortgage Loan or REO Property
pursuant to this Section 3.16(a) shall be accomplished by delivery to the
Trustee for deposit in the Distribution Account of the amount of the purchase
price. The Trustee shall immediately effectuate the conveyance of such
delinquent Mortgage Loan or REO Property to the Servicer to the extent
necessary, including the prompt delivery of all documentation to the Servicer.
Section 3.17 Trustee to Cooperate; Release of Files.
(a) Upon the payment in full of any Mortgage Loan (including any
liquidation of such Mortgage Loan through foreclosure or otherwise, or the
receipt by the Servicer of a notification that payment in full will be escrowed
in a manner customary for such purposes), the Servicer shall deliver to the
Trustee (or the Custodian as the case may be) two executed copies of a completed
"Request for Release" in the form of Exhibit E. Upon receipt of such Request for
Release of Documents, the Trustee (or the Custodian as the case may be) shall
promptly release the related Mortgage File, in trust to (i) the Servicer, or
(ii) such other party identified in the related Request for Release. Upon any
such payment in full, or the receipt of such notification that such funds have
been placed in escrow, the Servicer shall direct the Trustee in writing to
execute an instrument of satisfaction (or assignment of Mortgage without
recourse) regarding the Mortgaged Property relating to such 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 payment in
full, it being understood and agreed that no expense incurred in connection with
such instrument of satisfaction or assignment, as the case may be, shall be
chargeable to the Collection Account. In lieu of executing any such satisfaction
or assignment,
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as the case may be, the Servicer may prepare and submit to the Trustee a
satisfaction (or assignment without recourse, if requested by the Person or
Persons entitled thereto) in form for execution by the Trustee with all
requisite information completed by the Servicer; in such event, the Trustee
shall execute and acknowledge such satisfaction or assignment, as the case may
be, and deliver the same with the related Mortgage File, as aforesaid.
(b) From time to time and as appropriate in the servicing of any
Mortgage Loan, including, without limitation, foreclosure or other comparable
conversion of a Mortgage Loan or collection under any insurance policy relating
to a Mortgage Loan, the Trustee shall (except in the case of the payment or
liquidation pursuant to which the related Mortgage File is released to an escrow
agent or an employee, agent or attorney of the Trustee), upon written request of
the Servicer and delivery to the Trustee (or the Custodian, as the case may be)
of two executed copies of a "Request for Release" in the form of Exhibit E
signed by a Servicing Officer, release the related Mortgage File to the Servicer
and shall execute such documents as shall be necessary to the prosecution of any
such proceedings, including, without limitation, an assignment without recourse
of the related Mortgage to the Servicer. Such receipt shall obligate the
Servicer to return the Mortgage File to the Trustee (or the Custodian, as the
case may be) when the need therefor by the Servicer no longer exists unless the
Mortgage Loan shall be liquidated, in which case, upon receipt of a Request for
Release evidencing such liquidation, the receipt shall be released by the
Trustee (or the Custodian, as the case may be) to the Servicer.
(c) Subject to Section 3.01, the Servicer shall have the right to
accept applications of Mortgagors for consent to (i) partial releases of
Mortgages, (ii) alterations, (iii) removal, demolition or division of properties
subject to Mortgages and (iv) second mortgage subordination agreements. No
application for approval shall be considered by the Servicer unless: (w) it has
received an Opinion of Counsel, addressed to the Trustee (which opinion shall
not be an expense of the Trustee or the Trust Fund) that such sale, disposition,
substitution, acquisition or contribution will not affect adversely the status
of any REMIC constituting part of the Trust Fund as a REMIC or cause any REMIC
constituting part of the Trust Fund to be subject to a tax on "prohibited
transactions" or "contributions" pursuant to the REMIC Provisions; (x) the
provisions of the related Note and Mortgage have been complied with; (y) the
Combined Loan-to-Value Ratio and debt-to-income ratio after any release does not
exceed the maximum Combined Loan-to-Value Ratio and debt-to-income ratio
established in accordance with the underwriting standards of the Mortgage Loans;
and (z) the lien priority of the related Mortgage is not affected. Upon receipt
by the Trustee of a Servicing Officer's certificate setting forth the action
proposed to be taken in respect of a particular Mortgage Loan and certifying
that the criteria set forth in the immediately preceding sentence have been
satisfied, the Trustee shall execute and deliver to the Servicer the consent or
partial release so requested by the Servicer. A proposed form of consent or
partial release, as the case may be, shall accompany any Servicing Officer's
certificate delivered by the Servicer pursuant to this paragraph.
Section 3.18 Servicing Compensation.
As compensation for its activities hereunder, the Servicer shall be
entitled to retain the amount of the Servicing Fee with respect to each Mortgage
Loan (including REO Properties). The Servicer shall be entitled to retain
additional servicing compensation in the form of release fees, bad check
charges, assumption fees, modification or extension fees, late payment charges,
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customary real-estate referral fees or any other service-related fees, Insurance
Proceeds and Liquidation Proceeds not required to be deposited in the Collection
Account or the Distribution Account and similar items, to the extent collected
from Mortgagors.
Section 3.19 Annual Statement as to Compliance.
(a) The Servicer, at its own expense, will deliver to the Trustee
and the Depositor, not later than March 15 of each year, commencing in 2005, a
Servicing Officer's certificate stating, as to each signer thereof, that (i) a
review of the activities of the Servicer during such preceding fiscal year (or
such shorter period in the case of the first such report) and of performance
under this Agreement has been made under such officers' supervision, and (ii) to
the best of such officers' knowledge, based on such review, the Servicer has
fulfilled all its obligations under this Agreement for such year, or, if there
has been a default in the fulfillment of all such obligations, specifying each
such default known to such officers and the nature and status thereof including
the steps being taken by the Servicer to remedy such default.
(b) Delivery of such reports, information and documents to the
Trustee is for informational purposes only and their receipt of such shall not
constitute constructive notice of any information contained therein or
determinable, from information contained therein, including the Servicer's
compliance with any of its covenants hereunder (as to which the Trustee are
entitled to rely exclusively on Officers' Certificates).
Section 3.20 Annual Independent Certified Public Accountants' Reports.
(a) Not later than March 15 of each year, commencing in 2005, the
Servicer, at its expense, shall cause a nationally recognized firm of
independent certified public accountants to furnish to the Trustee and the
Depositor a report stating that (i) it has obtained a letter of representation
regarding certain matters from the management of the Servicer which includes an
assertion that the Servicer has complied with certain minimum residential
mortgage loan servicing standards, identified in either the Uniform Single
Attestation Program for Mortgage Bankers established by the Mortgage Bankers
Association of America or the Audit Program for Mortgages serviced by ▇▇▇▇▇▇▇
Mac, 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 in all
material respects, subject to such exceptions and other qualifications that may
be appropriate. Immediately upon receipt of such report, the Servicer shall
furnish a copy of such report to the Trustee, the Depositor and each Rating
Agency. Copies of such statement shall be provided by the Trustee to the
Certificate Insurer and any Certificateholder upon request at the Servicer's
expense, provided that such statement is delivered by the Servicer to the
Trustee.
(b) Delivery of such reports, information and documents to the
Trustee is for informational purposes only and their receipt of such shall not
constitute constructive notice of any information contained therein or
determinable, from information contained therein, including the Servicer's
compliance with any of its covenants hereunder (as to the Trustee is entitled to
rely exclusively on Officers' Certificates).
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Section 3.21 Access to Certain Documentation and Information Regarding the
Mortgage Loans.
The Servicer shall provide to the Trustee, Certificateholders that are
federally insured savings and loan associations, the Office of Thrift
Supervision, the FDIC and the supervisory agents and examiners of each of the
foregoing (which, in the case of supervisory agents and examiners, may be
required by applicable state and federal regulations) access to the
documentation regarding the Mortgage Loans, such access being afforded without
charge but only upon reasonable request and during normal business hours at the
offices of the Servicer designated by it.
Section 3.22 Reserved.
Section 3.23 Obligations of the Servicer in Respect of Compensating
Interest.
Not later than the close of business on each Servicer Remittance Date, the
Servicer shall deliver to the Trustee for deposit in the Distribution Account an
amount ("Compensating Interest") equal to the lesser of (A) the aggregate of the
Prepayment Interest Shortfalls on the Actuarial Mortgage Loans for the related
Distribution Date resulting from Principal Prepayments on the Actuarial Mortgage
Loans during the related Prepayment Period and (B) 50% of its aggregate
Servicing Fee received in the related Collection Period. The Servicer shall
apply Compensating Interest to offset any Prepayment Interest Shortfalls on the
Actuarial Mortgage Loans. The Servicer shall not have the right to reimbursement
for any amounts remitted to the Trustee in respect of Compensating Interest.
Such amounts so remitted shall be included in the Available Funds and
distributed therewith on the next Distribution Date. The Servicer shall not be
obligated to pay Compensating Interest with respect to Prepayment Interest
Shortfalls on Simple Interest Mortgage Loans or Relief Act Interest Shortfalls.
Section 3.24 Obligations of the Servicer in Respect of Mortgage Interest
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 Interest Rates, Monthly Payments or Principal Balances that were made
by the Servicer in a manner not consistent with the terms of the related
Mortgage Note and this Agreement, the Servicer, upon discovery or receipt of
notice thereof, immediately shall deliver to the Trustee 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 Depositor and
any successor servicer in respect of any such liability. Such indemnities shall
survive the termination or discharge of this Agreement.
Section 3.25 Investment of Funds in the Collection Account and the
Distribution Account.
(a) The Servicer may direct any depository institution maintaining
the Collection Account to invest the funds in the Collection 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
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Trustee 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 Trustee is the obligor thereon. In the absence of such direction, funds
in the Collection Account shall remain uninvested. All such Permitted
Investments shall be held to maturity, unless payable on demand. Any investment
of funds in the Collection Account shall be made in the name of the Trustee or
the Servicer, as applicable (in its capacity as such) or in the name of a
nominee of the Trustee. The Trustee shall be entitled to sole possession (except
with respect to investment direction of funds held in the Collection Account)
over each such investment and the income thereon, and any certificate or other
instrument evidencing any such investment shall be delivered directly to the
Trustee or its agent, together with any document of transfer necessary to
transfer title to such investment to the Trustee or its nominee. In the event
amounts on deposit in the Collection Account are at any time invested in a
Permitted Investment payable on demand, the Trustee shall at the direction of
the Servicer:
(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
determination by a Responsible Officer of the Trustee that
such Permitted Investment would not constitute a Permitted
Investment in respect of funds thereafter on deposit in the
Collection Account.
(b) All income and gain realized from the investment of funds in the
Collection Account shall be for the benefit of the Servicer. The Servicer shall
deposit in the Collection Account 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. Funds on deposit in the Distribution Account will
remain uninvested.
(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 8.01 and Section 8.02(a)(v),
upon the request of the Holders of Certificates representing more than 50% of
the Voting Rights allocated to any Class of Certificates, shall take such action
as may be appropriate to enforce such payment or performance, including the
institution and prosecution of appropriate proceedings.
The Trustee shall not in any way be held liable by reason of any
insufficiency in any Account held by the Trustee resulting from any investment
loss on any Permitted Investment included therein (except to the extent that the
Trustee is the obligor and has defaulted thereon).
Section 3.26 Liability of Servicer; Indemnification.
(a) Subject to clause (b) below and Section 6.03, the Servicer (or
the Trustee if it is required to succeed the Servicer hereunder) indemnifies and
holds the Trustee, the Seller,
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the Depositor, the Certificate Insurer and each Certificateholder harmless
against any and all claims, losses, penalties, fines, forfeitures, reasonable
legal fees and related costs, judgments, and any other costs, fees and expenses
that the Trustee, the Depositor and any Certificateholder may sustain in any way
related to the failure of the Servicer to perform its duties and service the
Mortgage Loans in compliance with the Servicing Standards. The Servicer shall
immediately notify the Trustee, the Depositor, the Certificate Insurer and each
Certificateholder if a claim is made that may result in such claims, losses,
penalties, fines, forfeitures, legal fees or related costs, judgments, or any
other costs, fees and expenses, and the Servicer shall assume (with the consent
of the Trustee) the defense of any such claim and pay all expenses in connection
therewith, including reasonable counsel fees, and promptly pay, discharge and
satisfy any judgment or decree which may be entered against the Servicer,
Trustee, the Depositor, the Certificate Insurer and/or Certificateholder in
respect of such claim. The provisions of this Section 3.26 shall survive the
termination of this Agreement and the payment of the outstanding Certificates.
(b) None of the Depositor, the Seller, the Servicer, or any of the
directors, officers, employees or agents of the Depositor, the Seller or the
Servicer shall be under any liability to the Trust Fund or the Certificate
Insurer or the Certificateholders for any action taken, or for refraining from
the taking of any action, in good faith pursuant to this Agreement, or for
errors in judgment; provided, however, that this provision shall not protect the
Depositor, the Seller or the Servicer or any such Person against any breach of
warranties or representations made herein, or against any specific liability
imposed on the Servicer for a breach of the Servicing Standard, or against any
liability which would otherwise be imposed by reason of its respective willful
misfeasance, bad faith, fraud or negligence in the performance of its duties or
by reasons of negligent disregard of its respective obligations or duties
hereunder.
The Depositor, the Servicer, the Seller and any director, officer,
employee or agent of the Depositor, the Seller or the Servicer, may rely in good
faith on any document of any kind which, prima facie, is properly executed and
submitted by any appropriate Person with respect to any matters arising
hereunder. The Depositor, the Servicer, the Seller, and any director, officer,
employee or agent of the Depositor, the Seller or the 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
or the Certificates, other than any loss, liability or expense incurred in
connection with any legal action incurred by reason of its respective
misfeasance, bad faith, fraud or negligence, a breach of a representation or
warranty hereunder or (in the case of the Servicer) a breach of the Servicing
Standard in the performance of its respective duties or by reason of negligent
disregard of its respective obligations or duties hereunder. Neither the
Depositor, the Seller nor the 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 expose it to
any expense or liability; provided, however, that the Depositor, the Seller or
the Servicer may in its discretion undertake any action related to its
obligations hereunder 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 and the Certificate Insurer hereunder.
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Section 3.27 Reports of Foreclosure and Abandonment of Mortgaged
Properties.
On or before the last day of February of each year beginning in 2005, the
Servicer shall file the reports of foreclosure and abandonment of any Mortgaged
Property required by Section 6050J of the Code with the Internal Revenue Service
and provide an Officer's Certificate certifying its compliance with this Section
3.27 to the Trustee. The reports from the Servicer shall be in form and
substance sufficient to meet the reporting requirements imposed by such Section
6050J.
Section 3.28 Protection of Assets.
(a) Except for transactions and activities entered into in
connection with the securitization that is the subject of this Agreement, the
Trust is not authorized and has no power to:
(1) borrow money or issue debt;
(2) merge with another entity, reorganize, liquidate or sell
assets; or
(3) engage in any business or activities.
(b) Each party to this Agreement agrees that it will not file an
involuntary bankruptcy petition against the Trustee or the Trust Fund or
initiate any other form of insolvency proceeding until after the Certificates
have been paid.
Section 3.29 Periodic Filings.
(a) The Trustee and the Servicer shall reasonably cooperate with the
Depositor in connection with the Trust's satisfying the reporting requirements
under the Exchange Act. Without limiting the generality of the foregoing, the
Trustee shall prepare on behalf of the Trust any monthly Current Reports on Form
8-K (each, a "Monthly Form 8-K") and Annual Reports on Form 10-K customary for
similar securities as required by the Exchange Act and the rules and regulations
of the Securities and Exchange Commission thereunder, and the Trustee shall sign
(other than any Annual Reports on Form 10-K) and file (via the Securities and
Exchange Commission's Electronic Data Gathering and Retrieval System) such forms
on behalf of the Trust. The Servicer shall sign any Annual Reports on Form 10-K.
(b) Each Monthly Form 8-K shall be filed by the Trustee within 15
days after each Distribution Date (commencing on the Distribution Date occurring
in March 2005 and ending with the Distribution Date following the filing of the
Form 15 Suspension Notification as set forth in Section 3.29(h) hereof),
including a copy of the statement set forth in Section 4.06(a) hereof for such
Distribution Date as an exhibit thereto. Prior to March 30th of each year (or
such earlier date as may be required by the Exchange Act and the rules and
regulations of the Securities and Exchange Commission), the Trustee shall file a
Form 10-K, in substance as required by applicable law or applicable Securities
and Exchange Commission staff's interpretations. Such Form 10-K shall include as
exhibits the Servicer's annual statement of compliance described under Section
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3.20, in each case to the extent they have been timely delivered to the
Trustee. If they are not so timely delivered, the Trustee shall file an amended
Form 10-K including such documents as exhibits reasonably promptly after they
are delivered to the Trustee. The Form 10-K shall also include a certification
in the form attached hereto as Exhibit N (the "Certification"), which shall be
signed by the senior officer of the Servicer in charge of servicing.
(c) The Trustee shall sign a certification (in the form attached
hereto as Exhibit O) for the benefit of the Servicer and its officers, directors
and Affiliates (provided, however, that the Trustee shall not undertake an
analysis of the accountant's report attached as an exhibit to the Form 10-K). No
later than the 20th day prior to the latest date on which the Form 10-K is
permitted to be filed, without regard to extension (or if such day is not a
Business Day, the immediately preceding Business Day), the Trustee shall deliver
to the Servicer (i) such certification and (ii) a completed Form 10-K to be
executed by the Servicer. No later than the 10th day prior to the latest date on
which the Form 10-K is permitted to be filed, without regard to extension (or if
such day is not a Business Day, the immediately preceding Business Day), the
Servicer shall deliver the signed Form 10-K and the signed Certification to be
filed to the Trustee. In addition, the Trustee shall indemnify and hold harmless
the Servicer and its officers, directors and Affiliates from and against any
losses, damages, penalties, fines, forfeitures, reasonable and necessary legal
fees and related costs, judgments and other costs and expenses arising out of
the Trustee's failure to deliver the certification (in the form attached hereto
as Exhibit O) pursuant to this Section 3.29(c) or any inaccuracy in such
certification, other than any losses, damages, penalties, fines, forfeitures,
reasonable and necessary legal fees and related costs, judgments and other costs
and expenses arising out of the Servicer's breach of its obligations under this
Agreement. If the indemnification provided for herein is unavailable or
insufficient to hold harmless the Servicer and its officers, directors and
Affiliates, then the Trustee shall contribute to the amount paid or payable by
the Servicer, its officers, directors or Affiliates as a result of the losses,
claims, damages or liabilities of the Servicer, its officers, directors or
Affiliates in such proportion as is appropriate to reflect the relative fault of
the Servicer and its officers, directors and Affiliates on the one hand and the
Trustee on the other.
(d) The Servicer shall indemnify and hold harmless the Trustee and
its officers, directors and Affiliates from and against any losses, damages,
penalties, fines, forfeitures, reasonable and necessary legal fees and related
costs, judgments and other costs and expenses arising out of the Servicer's
failure to sign and deliver either the Certification or the Form 10-K within the
time frame provided in Section 3.29(c), other than any losses, damages,
penalties, fines, forfeitures, reasonable and necessary legal fees and related
costs, judgments and other costs and expenses arising out of the Trustee's
breach of its obligations under this Agreement. If the indemnification provided
for herein is unavailable or insufficient to hold harmless the Trustee and its
officers, directors and Affiliates, then the Servicer shall contribute to the
amount paid or payable by the Trustee, its officers, directors or Affiliates as
a result of the losses, claims, damages or liabilities of the Trustee, its
officers, directors or Affiliates in such proportion as is appropriate to
reflect the relative fault of the Trustee and its officers, directors and
Affiliates on the one hand and the Servicer on the other.
(e) If the Securities and Exchange Commission issues additional
interpretative guidance or promulgates additional rules or regulations, or if
other changes in applicable law occur, that would require the reporting
arrangements, or the allocation of responsibilities with
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respect thereto, described in this Section 3.29, to be conducted differently
than as described, the Depositor, Servicer and Trustee will reasonably cooperate
to amend the provisions of this Section 3.29 in order to comply with such
amended reporting requirements and such amendment of this Section 3.29. Any such
amendment shall be made in accordance with the first paragraph of Section 11.01
without further consent of the Certificateholders and without the requirement to
deliver (i) notice in writing to the Depositor, the Servicer and the Trustee
from the Rating Agencies that such action will not result in the reduction or
withdrawal of the rating of any outstanding Class of Certificates with respect
to which it is a Rating Agency, or (ii) an Opinion of Counsel delivered to the
Servicer and the Trustee. Such amendment may result in the reduction of the
reports filed by the Trustee on behalf of the Trust under the Exchange Act.
Notwithstanding the foregoing, none of the Depositor, Servicer or Trustee shall
be obligated to enter into any amendment pursuant to this Section 3.29 that
adversely affects its obligations and immunities under this Agreement.
(f) In filing any Monthly Form 8-K or Form 10-K, the Trustee shall
not undertake any analysis of, and shall have no responsibility for, any
financial information, accountant's report, certification or other matter
contained therein, except for computations performed by the Trustee and
reflected in the statement set forth in Section 4.06(a) hereof.
(g) Upon any filing with the Securities and Exchange Commission, the
Trustee shall promptly deliver to the Depositor and the Servicer a copy of any
such executed report, statement or information.
(h) Prior to January 30 of the first year in which the Trustee is
able to do so under applicable law, the Trustee shall file a Form 15 Suspension
Notification with respect to the Trust.
Section 3.30 Advance Facility.
(a) The Servicer is hereby authorized to enter into a financing or
other facility (any such arrangement, an "Advance Facility"), the documentation
for which complies with Section 3.30(e) below, under which (1) the Servicer
assigns or pledges its rights under this Agreement to be reimbursed for any or
all Advances and/or Servicing Advances to (i) a Person, which may be a
special-purpose bankruptcy-remote entity (an "SPV"), (ii) a Person, which may
simultaneously assign or pledge such rights to an SPV or (iii) a lender (a
"Lender"), which, in the case of any Person or SPV of the type described in
either of the preceding clauses (i) or (ii), may directly or through other
assignees and/or pledgees, assign or pledge such rights to a Person, which may
include a trustee acting on behalf of holders of debt instruments (any such
Person or any such Lender, an "Advance Financing Person"), and/or (2) an Advance
Financing Person agrees to fund all the Advances and/or Servicing Advances
required to be made by the Servicer pursuant to this Agreement. No consent of
the Trustee, Certificateholders or any other party shall be required before the
Servicer may enter into an Advance Facility nor shall the Trustee or the
Certificateholders be a third party beneficiary of any obligation of an Advance
Financing Person to the Servicer. Notwithstanding the existence of any Advance
Facility under which an Advance Financing Person agrees to fund Advances and/or
Servicing Advances, (A) the Servicer (i) shall remain obligated pursuant to this
Agreement to make Advances and/or Servicing Advances pursuant to and as required
by this Agreement and (ii) shall not be relieved of such
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obligations by virtue of such Advance Facility and (B) neither the Advance
Financing Person nor any Servicer's Assignee (as hereinafter defined) shall have
any right to proceed against or otherwise contact any Mortgagor for the purpose
of collecting any payment that may be due with respect to any related Mortgage
Loan or enforcing any covenant of such Mortgagor under the related Mortgage Loan
documents.
(b) If the Servicer enters into an Advance Facility, the Servicer
and the related Advance Financing Person shall deliver to the Trustee at the
address set forth in Section 11.05 hereof a written notice (an "Advance Facility
Notice"), stating (a) the identity of the Advance Financing Person and (b) the
identity of the Person (the "Servicer's Assignee") that will, subject to Section
3.30(c) hereof, have the right to make withdrawals from the Collection Account
pursuant to Section 3.05 hereof to reimburse previously unreimbursed Advances
and/or Servicing Advances ("Advance Reimbursement Amounts"). Advance
Reimbursement Amounts (i) shall consist solely of amounts in respect of Advances
and/or Servicing Advances for which the Servicer would be permitted to reimburse
itself in accordance with Section 3.05 hereof, assuming the Servicer had made
the related Advance(s) and/or Servicing Advance(s) and (ii) shall not consist of
amounts payable to a successor Servicer in accordance with Section 3.05 hereof
to the extent permitted under Section 3.30(e) below.
(c) Notwithstanding the existence of an Advance Facility, the
Servicer, on behalf of the Advance Financing Person, shall be entitled to
receive reimbursements of Advances and/or Servicing Advances in accordance with
Section 3.05 hereof, which entitlement may be terminated by the Advance
Financing Person pursuant to a written notice to the Trustee in the manner set
forth in Section 11.05 hereof. Upon receipt of such written notice, the Servicer
shall no longer be entitled to receive reimbursement for any Advance
Reimbursement Amounts and the Servicer's Assignee shall immediately have the
right to receive from the Collection Account all Advance Reimbursement Amounts.
Notwithstanding the foregoing, and for the avoidance of doubt, (i) the Servicer
and/or the Servicer's Assignee shall only be entitled to reimbursement of
Advance Reimbursement Amounts hereunder pursuant to Section 3.05 of this
Agreement and shall not otherwise be entitled to make withdrawals of, or
receive, Advance Reimbursement Amounts that shall be deposited in the
Distribution Account pursuant to Section 3.04(b) hereof, and (ii) none of the
Trustee or the Certificateholders shall have any right to, or otherwise be
entitled to, receive any Advance Reimbursement Amounts to which the Servicer or
Servicer's Assignee, as applicable, shall be entitled pursuant to Section 3.05
hereof. An Advance Facility may be terminated by the joint written direction of
the Servicer and the related Advance Financing Person. Written notice of such
termination shall be delivered to the Trustee in the manner set forth in Section
11.05 hereof. The Trustee shall have no duty or liability with respect to the
calculation of any Advance Reimbursement Amount and shall be entitled to rely
without independent investigation on the Advance Facility Notice and on such
Servicer's report of the amount of Advance Reimbursement Amounts and Servicing
Advance Reimbursement Amounts that were included in the remittance from such
Servicer to the Trustee pursuant to Section 4.07. Such Servicer shall maintain
and provide to any successor Servicer a detailed accounting on a loan-by-loan
basis as to amounts advanced by, pledged or assigned to, and reimbursed to any
Advance Financing 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.
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(d) [Reserved.]
(e) As between a predecessor Servicer and its Advance Financing
Person, on the one hand, and a successor Servicer and its Advance Financing
Person, if any, on the other hand, Advance Reimbursement Amounts on a
loan-by-loan basis with respect to each Mortgage Loan as to which a Advance
and/or Servicing Advance shall have been made and be outstanding shall be
allocated on a "first-in, first out" basis. In the event the Servicer's Assignee
shall have received some or all of an Advance Reimbursement Amount related to
Advances and/or Servicing Advances that were made by a Person other than such
predecessor Servicer or its related Advance Financing Person in error, then such
Servicer's Assignee shall be required to remit any portion of such Advance
Reimbursement Amount to each Person entitled to such portion of such Advance
Reimbursement Amount. Without limiting the generality of the foregoing, the
Servicer shall remain entitled to be reimbursed by the Advance Financing Person
for all Advances and/or Servicing Advances funded by the Servicer to the extent
the related Advance Reimbursement Amounts have not been assigned or pledged to
such Advance Financing Person or Servicer's Assignee.
(f) For purposes of any certification of a Servicing Officer of the
Servicer made pursuant to Section 4.07(d), any Nonrecoverable Advance referred
to therein may have been made by such Servicer or any predecessor Servicer. In
making its determination that any Advance or Servicing Advance theretofore made
has become a Nonrecoverable Advance, the Servicer shall apply the same criteria
in making such determination regardless of whether such Advance or Servicing
Advance shall have been made by the Servicer or any predecessor Servicer.
(g) The Trustee shall not, as a result of the existence of any
Advance Facility, have any additional responsibility to track or monitor Advance
Reimbursement Amounts or any Advance Facility, and, except as expressly provided
in Section 3.30(c) above, is not and shall not be obligated to make any payment
with respect to any Advance Reimbursement Amount. The Servicer hereby
indemnifies the Trustee, the Trust Fund and any successor Servicer, as
applicable, from and against any claims, losses, liabilities or damages
resulting from any claim by the related Advancing Person, except to the extent
that such claim, loss, liability or damage resulted from or arose out of
negligence, recklessness or willful misconduct on the part of the Trustee or the
successor Servicer, or failure by the successor Servicer or the Trustee to remit
funds as required by this Agreement or the commission of an act or omission to
act by the successor Servicer or the Trustee, and the passage of any applicable
cure or grace period, such that a Servicer Event of Termination under this
Agreement occurs or such entity is subject to termination for cause under this
Agreement.
Section 3.31 Certificate Insurer Access
(a) Upon the occurrence of a Trigger Event, the Servicer shall upon
reasonable prior notice and during normal business hours, afford the Certificate
Insurer access to its books and records concerning the servicing of the Mortgage
Loans, and shall make servicing officers available to the Certificate Insurer to
discuss the servicing of the Mortgage Loans, upon reasonable prior notice to the
Servicer and during the Servicer's normal business hours.
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ARTICLE IV
FLOW OF FUNDS
Section 4.01 Interest Distributions.
On each Distribution Date, the Trustee shall withdraw from the
Distribution Account the Interest Remittance Amount and apply it in the
following order of priority (based upon the Mortgage Loan information provided
to it in the Remittance Report, upon which the Trustee may conclusively rely),
the calculations required to be made by the Trustee, to the extent available:
(i) to the Trustee, the Trustee Fee for such Distribution Date;
(ii) concurrently, as follows:
(A) from the Group I Interest Remittance Amount, to the Class
AV-1 Certificates, the applicable Accrued Certificate Interest for such
Distribution Date; and
(B) from the Group II Interest Remittance Amount, first to the
Certificate Insurer, the Insurer Fee and, second, to the Class AF-1, Class AF-2,
Class AF-3 and Class AF-4 Certificates, pro rata, the applicable Accrued
Certificate Interest for such Distribution Date;
(iii) concurrently, as follows:
(A) from the Group I Interest Remittance Amount, to the Class
AV-1 Certificates, the applicable Interest Carry Forward Amount for such
Distribution Date for the Class AV-1 Certificates; and
(B) from the Group II Interest Remittance Amount, pro rata,
all applicable Interest Carry Forward Amounts for such Distribution Date to the
Class AF-1, Class AF-2, Class AF-3 (to the extent not previously reimbursed by
the Certificate Insurer), Class AF-4 Certificates and all unpaid Insurer
Reimbursement Amounts that have been made in respect of interest shortfalls to
the Certificate Insurer;
(iv) concurrently, as follows:
(A) from the Group I Interest Remittance Amount, pro rata, to
the Class AF-1, Class AF-2, Class AF-3 and Class AF-4 Certificates, any unpaid
Accrued Certificate Interest and Interest Carry Forward Amount for each such
Class for such Distribution Date and to the Certificate Insurer all unpaid
Insurer Reimbursement Amounts that have been made in respect of interest
shortfalls; and
(B) from the Group II Interest Remittance Amount, to the Class
AV-1 Certificates, any unpaid Accrued Certificate Interest and Interest Carry
Forward Amount for such Class for such Distribution Date;
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(v) to the Class M-1 Certificates, the Accrued Certificate Interest
thereon for such Distribution Date;
(vi) to the Class M-2 Certificates, the Accrued Certificate Interest
thereon for such Distribution Date;
(vii) to the Class M-3 Certificates, the Accrued Certificate
Interest thereon for such Distribution Date;
(viii) to the Class B-1 Certificates, the Accrued Certificate
Interest thereon for such Distribution Date;
(ix) to the Class B-2 Certificates, the Accrued Certificate Interest
thereon for such Distribution Date;
(x) to the Class B-3 Certificates, the Accrued Certificate Interest
thereon for such Distribution Date;
(xi) to the Class B-4 Certificates, the Accrued Certificate Interest
thereon for such Distribution Date; and
(xii) the amount, if any, of the Interest Remittance Amount
remaining after application with respect to the priorities set forth above will
be applied as described under Section 4.02(b) hereof.
Section 4.02 Distributions of Principal and Monthly Excess Cashflow
Amounts.
(a) On each Distribution Date, the Trustee shall make the following
distributions in the following order of priority (based upon the Mortgage Loan
information provided to it in the Remittance Report), and the calculations
required to be made by the Trustee, to the extent of the Principal Distribution
Amount:
(i) before the Stepdown Date or with respect to which a
Trigger Event is in effect, sequentially, as follows:
(A) concurrently, as follows:
(1) the Group I Principal Distribution Amount to
the Class AV-1 Certificates, until the Certificate Principal Balance thereof has
been reduced to zero; and
(2) the Group II Principal Distribution Amount,
concurrently, pro rata, as follows: (a) to the Class AF-4 Certificates, the
Class AF-4 Lockout Distribution Amount; and (b) sequentially, to the Class AF-1
Certificates until the Certificate Principal Balance thereof has been reduced to
zero, to the Class AF-2 Certificates until the Certificate Principal Balance
thereof has been reduced to zero, to the Class AF-3 Certificates until the
Certificate Principal Balance thereof has been reduced to zero, to the
Certificate Insurer all Insurer Reimbursement Amounts in respect of any draw for
principal of the Class AF-3
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Certificates and to the Class AF-4 Certificates until the Certificate Principal
Balance thereof has been reduced to zero, in that order;
(B) concurrently, as follows:
(1) the Group I Principal Distribution Amount
remaining after distributions pursuant to priority (A)(1) above, sequentially,
to the Class AF-1 Certificates, until the Certificate Principal Balance thereof
has been reduced to zero, to the Class AF-2 Certificates, until the Certificate
Principal Balance thereof has been reduced to zero, to the Class AF-3
Certificates, until the Certificate Principal Balance thereof has been reduced
to zero, to the Certificate Insurer all Insurer Reimbursement Amounts in respect
of any draw for principal of the Class AF-3 Certificates and to the Class AF-4
Certificates, until the Certificate Principal Balance thereof has been reduced
to zero, in that order; and
(2) the Group II Principal Distribution Amount
remaining after distributions pursuant to priority (A)(2) above, to the Class
AV-1 Certificates, until the Certificate Principal Balance thereof has been
reduced to zero;
(C) to the Holders of the Class M-1 Certificates, 100%
of the remaining Principal Distribution Amount for such Distribution Date, until
the Certificate Principal Balance of the Class M-1 Certificates has been reduced
to zero;
(D) to the Holders of the Class M-2 Certificates, 100%
of the remaining Principal Distribution Amount, until the Certificate Principal
Balance of the Class M-2 Certificates has been reduced to zero;
(E) to the Holders of the Class M-3 Certificates, 100%
of the remaining Principal Distribution Amount, until the Certificate Principal
Balance of the Class M-3 Certificates has been reduced to zero;
(F) to the Holders of the Class B-1 Certificates, 100%
of the remaining Principal Distribution Amount, until the Certificate Principal
Balance of the Class B-1 Certificates has been reduced to zero;
(G) to the Holders of the Class B-2 Certificates, 100%
of the remaining Principal Distribution Amount, until the Certificate Principal
Balance of the Class B-2 Certificates has been reduced to zero
(H) to the Holders of the Class B-3 Certificates, 100%
of the remaining Principal Distribution Amount, until the Certificate Principal
Balance of the Class B-3 Certificates has been reduced to zero;
(I) to the Holders of the Class B-4 Certificates, 100%
of the remaining Principal Distribution Amount, until the Certificate Principal
Balance of the Class B-4 Certificates has been reduced to zero; and
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(J) any amount of the Principal Distribution Amount
remaining after making all of the distributions in clauses (A), (B), (C), (D),
(E), (F), (G), (H) and (I) shall be applied as set forth in Section 4.02(b).
(ii) on or after the Stepdown Date and as long as a Trigger
Event is not in effect:
(A) concurrently as follows:
(1) the Group I Principal Distribution Amount to
the Class AV-1 Certificates, until the Certificate Principal Balance thereof has
been reduced to zero; and
(2) the Group II Principal Distribution Amount,
concurrently, pro rata, as follows (a) to the Class AF-4 Certificates, the Class
AF-4 Lockout Distribution Amount and (b) sequentially, to the Class AF-1
Certificates, until the Certificate Principal Balance thereof has been reduced
to zero, to the Class AF-2 Certificates, until the Certificate Principal Balance
thereof has been reduced to zero, to the Class AF-3 Certificates, until the
Certificate Principal Balance thereof has been reduced to zero, to the
Certificate Insurer, all Insurer Reimbursement Amounts in respect of any draw
for principal of the Class AF-3 Certificates and to the Class AF-4 Certificates,
until the Certificate Principal Balance thereof has been reduced to zero, in
that order;
(B) concurrently, as follows:
(1) the Group I Principal Distribution Amount
remaining after distributions pursuant to priority (A)(1) above, sequentially to
the Class AF-1 Certificates, until the Certificate Principal Balance thereof has
been reduced to zero, to the Class AF-2 Certificates, until the Certificate
Principal Balance thereof has been reduced to zero, to the Class AF-3
Certificates, until the Certificate Principal Balance thereof has been reduced
to zero, to the Certificate Insurer all Insurer Reimbursement Amounts in respect
of any draw for principal of the Class AF-3 Certificates and to the Class AF-4
Certificates, until the Certificate Principal Balance thereof has been reduced
to zero, in that order; and
(2) the Group II Principal Distribution Amount
remaining after distributions pursuant to priority (A)(2) above, to the Class
AV-1 Certificates, until the Certificate Principal Balance thereof has been
reduced to zero;
(C) the lesser of (x) the excess of (i) the Principal
Distribution Amount over (ii) the sum of the amount distributed to the Class A
Certificates in clauses (A) and (B) above and (y) the Class M-1 Principal
Distribution Amount will be distributed to the Class M-1 Certificates, until the
Certificate Principal Balance thereof has been reduced to zero;
(D) the lesser of (x) the excess of (i) the Principal
Distribution Amount over (ii) the sum of the amount distributed to the Class A
Certificates in clauses (A) and (B) above and the amount distributed to the
Class M-1 Certificates in clause (C)
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above and (y) the Class M-2 Principal Distribution Amount will be distributed to
the Class M-2 Certificates, until the Certificate Principal Balance thereof has
been reduced to zero;
(E) the lesser of (x) the excess of (i) the Principal
Distribution Amount over (ii) the sum of the amount distributed to the Class A
Certificates in clauses (A) and (B) above, the amount distributed to the Class
M-1 Certificates in clause (C) above and the amount distributed to the Class M-2
Certificates in clause (D) above and (y) the Class M-3 Principal Distribution
Amount will be distributed to the Class M-3 Certificates, until the Certificate
Principal Balance thereof has been reduced to zero;
(F) the lesser of (x) the excess of (i) the Principal
Distribution Amount over (ii) the sum of the amount distributed to the Class A
Certificates pursuant to clauses (A) and (B) above, the amount distributed to
the Class M-1 Certificates pursuant to clause (C) above, the amount distributed
to the Class M-2 Certificates pursuant to clause (D) above and the amount
distributed to the Class M-3 Certificates pursuant to clause (E) above and (y)
the Class B-1 Principal Distribution Amount will be distributed to the Class B-1
Certificates, until the Certificate Principal Balance thereof has been reduced
to zero;
(G) the lesser of (x) the excess of (i) the Principal
Distribution Amount over (ii) the sum of the amount distributed to the Class A
Certificates pursuant to clauses (A) and (B) above, the amount distributed to
the Class M-1 Certificates pursuant to clause (C) above, the amount distributed
to the Class M-2 Certificates pursuant to clause (D) above, the amount
distributed to the Class M-3 Certificates pursuant to clause (E) above and the
amount distributed to the Class B-1 Certificates pursuant to clause (F) above
and (y) the Class B-2 Principal Distribution Amount will be distributed to the
Class B-2 Certificates, until the Certificate Principal Balance thereof has been
reduced to zero;
(H) the lesser of (x) the excess of (i) the Principal
Distribution Amount over (ii) the sum of the amount distributed to the Class A
Certificates pursuant to clauses (A) and (B) above, the amount distributed to
the Class M-1 Certificates pursuant to clause (C) above, the amount distributed
to the Class M-2 Certificates pursuant to clause (D) above, the amount
distributed to the Class M-3 Certificates pursuant to clause (E) above, the
amount distributed to the Class B-1 Certificates pursuant to clause (F) above
and the amount distributed to the Class B-2 Certificates pursuant to clause (G)
above and (y) the Class B-3 Principal Distribution Amount will be distributed to
the Class B-3 Certificates, until the Certificate Principal Balance thereof has
been reduced to zero;
(I) the lesser of (x) the excess of (i) the Principal
Distribution Amount over (ii) the sum of the amount distributed to the Class A
Certificates pursuant to clauses (A) and (B) above, the amount distributed to
the Class M-1 Certificates pursuant to clause (C) above, the amount distributed
to the Class M-2 Certificates pursuant to clause (D) above, the amount
distributed to the Class M-3 Certificates pursuant to clause (E) above, the
amount distributed to the Class B-1 Certificates pursuant to clause (F) above,
the amount distributed to the Class B-2 Certificates pursuant to clause (G)
above and the amount distributed to the Class B-3 Certificates pursuant to
clause (H) above and (y) the Class B-4 Principal Distribution Amount will be
distributed to the Class B-4 Certificates, until the Certificate Principal
Balance thereof has been reduced to zero; and
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(J) any amount of the Principal Distribution Amount
remaining after making all of the distributions in clauses (A), (B), (C), (D),
(E), (F), (G), (H) and (I) above shall be applied as set forth in Section
4.02(b).
(b) On each Distribution Date, any Monthly Excess Cashflow Amount
shall be distributed, to the extent available, in the following order of
priority on such Distribution Date:
(i) to pay any remaining unpaid Accrued Certificate Interest
for such Distribution Date, pro rata, among the Class AV-1, Class AF-1, Class
AF-2, Class AF-3, Class AF-4 Certificates and any remaining unpaid Insurer Fee
to the Certificate Insurer;
(ii) pro rata, to pay any remaining Interest Carry Forward
Amounts for the classes of Class A Certificates, if any, among the Class AV-1,
Class AF-1, Class AF-2, Class AF-3 and Class AF-4 Certificates and any remaining
unpaid Insurer Reimbursement Amounts in respect of draws that have been made in
respect of interest shortfalls to the Certificate Insurer;
(iii) to pay the Extra Principal Distribution Amount for such
Distribution Date in accordance with Section 4.02(a);
(iv) to pay any remaining unpaid Accrued Certificate Interest
for such Distribution Date for the Class M-1 Certificates;
(v) to pay the remaining Class M-1 Interest Carry Forward
Amount, if any;
(vi) to pay the Class M-1 Realized Loss Amortization Amount
for such Distribution Date;
(vii) to pay any remaining unpaid Accrued Certificate Interest
for such Distribution Date for the Class M-2 Certificates;
(viii) to pay the remaining Class M-2 Interest Carry Forward
Amount, if any;
(ix) to pay the Class M-2 Realized Loss Amortization Amount
for such Distribution Date;
(x) to pay any remaining unpaid Accrued Certificate Interest
for such Distribution Date for the Class M-3 Certificates;
(xi) to pay the remaining Class M-3 Interest Carry Forward
Amount, if any;
(xii) to pay the Class M-3 Realized Loss Amortization Amount
for such Distribution Date;
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(xiii) to pay any remaining unpaid Accrued Certificate
Interest for such Distribution Date for the Class B-1 Certificates;
(xiv) to pay the remaining Class B-1 Interest Carry Forward
Amount, if any;
(xv) to pay the Class B-1 Realized Loss Amortization
Amount for such Distribution Date;
(xvi) to pay any remaining unpaid Accrued Certificate
Interest for such Distribution Date for the Class B-2 Certificates;
(xvii) to pay the remaining Class B-2 Interest Carry Forward
Amount, if any;
(xviii) to pay the Class B-2 Realized Loss Amortization
Amount for such Distribution Date;
(xix) to pay any remaining unpaid Accrued Certificate
Interest for such Distribution Date for the Class B-3 Certificates;
(xx) to pay the remaining Class B-3 Interest Carry Forward
Amount, if any;
(xxi) to pay the Class B-3 Realized Loss Amortization
Amount for such Distribution Date;
(xxii) to pay any remaining unpaid Accrued Certificate
Interest for such Distribution Date for the Class B-4 Certificates;
(xxiii) to pay the remaining Class B-4 Interest Carry Forward
Amount, if any;
(xxiv) to pay the Class B-4 Realized Loss Amortization
Amount for such Distribution Date;
(xxv) to pay the Class R Excess Interest Amount for such
Distribution Date;
(xxvi) to pay the Class R Excess Interest Carryforward
Amount for such Distribution Date;
(xxvii) to the Class AV-1 Certificates, the aggregate amount
of any LIBOR Carryover Amount due to such Certificates;
(xxviii) sequentially, to the Class ▇-▇, ▇▇▇▇▇ ▇-▇, Class M-3,
Class B-1, Class B-2, Class B-3 and Class B-4 Certificates, in that order, any
LIBOR Carryover Amount due to such Certificates;
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(xxix) any remaining unpaid Insurer Reimbursement Amounts to
the Certificate Insurer;
(xxx) to pay the Class N Certificates, from the remaining
amount distributable on the Class X/N Interest, (A) the Accrued Certificate
Interest for the Class N Certificates, (B) the unpaid Interest Carry Forward
Amount for the Class N Certificates and (C) any remaining Monthly Excess
Cashflow Amount to reduce the Class N Notional Amount, until the Class N
Notional Amount has been reduced to zero; and
(xxxi) to the Class X Certificates, the Class X Distributable
Amount for such Distribution Date.
On each Distribution Date, there shall be distributed to the Holders of
the Class R Certificates any remaining amount in the Distribution Account on
such date after the application pursuant to Sections 4.01, 4.02(a),
4.02(b)(i)-(xxxi) and 4.02(c).
(c) On each Distribution Date, all prepayment penalties (including
amounts deposited in connection with the full or partial waiver of such
prepayment penalties pursuant to Section 3.01) shall be allocated to the Class N
Certificates (first as payments of Accrued Certificate Interest for the Class N
Certificates, then as payments in respect of the unpaid Interest Carry Forward
Amount for the Class N Certificates and finally as payments in respect of the
Class N Notional Amount) for so long as the Notional Amount of the Class N
Certificates is greater than zero pursuant to Section 4.02(b)(xxx) above and
this Section 4.02(c)), and to the Class X Certificates after the Class N
Notional Amount has been reduced to zero.
(d) Any amounts distributed to the Certificates in respect of LIBOR
Carryover Amounts pursuant to Sections 4.02(b)(xxvii) and (xxviii) shall first
be deemed distributed by REMIC 2 as a distribution in respect of the REMIC 2
Class X/N Interest, to REMIC 9 and distributed thereby as a distribution to the
REMIC 9 Class X/N Interest, and then distributed to the Certificates from the
Grantor Trust as payments on notional principal contracts in the nature of cap
contracts. The Trustee shall account for the rights to receive LIBOR Carryover
Amounts as rights in a limited recourse interest rate cap contract written by
the Holder of the Class X/N Interest. For federal information reporting
purposes, such rights shall be assigned a value of zero.
(e) Any amounts distributed to the Class AF-3 Certificates pursuant
to Section 4.01 or this Section 4.02 shall be deemed distributed by REMIC 2 to
REMIC 3 in respect of the REMIC 2 AF-3 Interest, and distributed thereby as a
distribution in respect of the Class AF-3 Certificates. Any amounts distributed
to the Class M-3 Certificates pursuant to Section 4.01 or this Section 4.02,
other than LIBOR Carryover Amounts, shall be deemed distributed by REMIC 2 to
REMIC 4 in respect of the REMIC 2 M-3 Interest, and distributed thereby as a
distribution in respect of the REMIC 4 M-3 Interest. Any amounts distributed to
the Class B-1 Certificates pursuant to Section 4.01 or this Section 4.02, other
than LIBOR Carryover Amounts, shall be deemed distributed by REMIC 2 to REMIC 5
in respect of the REMIC 2 B-1 Interest, and distributed thereby as a
distribution in respect of the REMIC 5 B-1 Interest. Any amounts distributed to
the Class B-2 Certificates pursuant to Section 4.01 or this Section 4.02, other
than LIBOR Carryover Amounts, shall be deemed distributed by REMIC 2 to REMIC 6
in respect of
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the REMIC 2 B-2 Interest, and distributed thereby as a distribution in respect
of the REMIC 6 B-2 Interest. Any amounts distributed to the Class B-3
Certificates pursuant to Section 4.01 or this Section 4.02, other than LIBOR
Carryover Amounts, shall be deemed distributed by REMIC 2 to REMIC 7 in respect
of the REMIC 2 B-3 Interest, and distributed thereby as a distribution in
respect of the REMIC 7 B-3 Interest. Any amounts distributed to the Class B-4
Certificates pursuant to Section 4.01 or this Section 4.02, other than LIBOR
Carryover Amounts, shall be deemed distributed by REMIC 2 to REMIC 8 in respect
of the REMIC 2 B-4 Interest, and distributed thereby as a distribution in
respect of the REMIC 8 B-4 Interest.
Section 4.03 Allocation of Losses.
Realized Losses shall be allocated first against the Remaining Initial
Overcollateralization Amount and second to the Subsequent Overcollateralization
Amount, until the Overcollateralization Amount has been reduced to zero. If,
after giving effect to the distribution of the Principal Distribution Amount on
any Distribution Date the aggregate Certificate Principal Balance of the Offered
Certificates and Class B-4 Certificates exceeds the Pool Balance as of the end
of the related Collection Period, such excess will be allocated against the
Class B-4, Class B-3, Class B-2, Class B-1, Class M-3, Class M-2 and Class M-1
Certificates, in that order, until the respective Certificate Principal Balances
thereof are reduced to zero.
Special Hazard Losses will be allocated as described above, provided that
if the cumulative amount of such losses, as of any date of determination,
exceeds the greatest of (i) 1.0% of the Pool Balance as of the Cut-off Date,
(ii) two times the amount of the principal balance of the largest Mortgage Loan
as of the date of determination and (iii) an amount equal to the aggregate
principal balances of the Mortgage Loans in the largest zip-code concentration
in the State of California as of the date of determination, such losses will be
allocated among the Class M-1, Class M-2, Class M-3, Class B-1, Class B-2, Class
B-3 and Class B-4 Certificates, pro rata, based on their respective Certificate
Principal Balances.
Section 4.04 Method of Distribution.
The Trustee shall make distributions in respect of a Distribution Date to
each Certificateholder of record on the related Record Date (other than as
provided in Section 10.01 respecting the final distribution), in the case of
Certificateholders of the Certificates, by wire transfer in immediately
available funds to the account of the Person entitled thereto if such Person
shall have so notified the Trustee in writing at least five Business Days prior
to the Record Date immediately prior to such Distribution Date and is the
registered owner of such Certificates the aggregate initial Certificate
Principal Balance or Notional Amount of which is in excess of $5,000,000, or 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, provided that
the Trustee may deduct a reasonable wire transfer fee from any payment made by
wire transfer. Distributions among Certificateholders shall be made in
proportion to the Percentage Interests evidenced by the Certificates held by
such Certificateholders.
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Section 4.05 Distributions on Book-Entry Certificates.
Each distribution with respect to a Book-Entry Certificate shall be paid
to the Depository, which shall credit 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. All such credits
and disbursements with respect to a Book-Entry Certificate are to be made by the
Depository and the Depository Participants in accordance with the provisions of
the Certificates. None of the Trustee, the Depositor, the Servicer or the Seller
shall have any responsibility therefor except as otherwise provided by
applicable law.
Section 4.06 Statements.
(a) On each Distribution Date, based, as applicable, on the Mortgage
Loan information contained in the Remittance Report, the Trustee shall prepare
and post on its website at ▇▇▇.▇▇▇▇▇▇.▇▇▇/▇▇▇, a statement as to the
distributions made on such Distribution Date:
(i) the amount of the distribution made on such Distribution
Date to the Holders of each Class of Certificates allocable to principal or
reduction of Notional Amount, separately identified;
(ii) the amount of the distribution made on such Distribution
Date to the Holders of each Class of Certificates allocable to interest or Class
X Distributable Amount, separately identified;
(iii) the Overcollateralization Amount, the
Overcollateralization Release Amount, the Overcollateralization Deficiency and
the Targeted Overcollateralization Amount as of such Distribution Date and the
Monthly Excess Interest Amount and Monthly Excess Cashflow Amount for such
Distribution Date;
(iv) the aggregate amount of servicing compensation received
by the Servicer during the related Collection Period;
(v) the aggregate amount of Advances for the related
Collection Period;
(vi) the Pool Balance and the Loan Group Balance for each Loan
Group at the close of business at the end of the related Collection Period;
(vii) separately stated for each Loan Group, the number,
weighted average remaining term to maturity and weighted average Mortgage
Interest Rate of the Mortgage Loans as of the related Due Date;
(viii) separately stated for each Loan Group, the number and
aggregate unpaid principal balance of Mortgage Loans (a) 30 to 59 days past due
on a contractual basis, (b) 60 to 89 days past due on a contractual basis, (c)
90 or more days past due on a contractual basis,
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(d) as to which foreclosure proceedings have been commenced and (e) in
bankruptcy as of the close of business on the last day of the calendar month
preceding such Distribution Date;
(ix) separately stated for each Loan Group, 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 Principal Balance of such Mortgage Loan as of the date it became an REO
Property;
(x) separately stated for each Loan Group, 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, and, cumulatively, the total
number and cumulative principal balance of all REO Properties as of the close of
business of the last day of the preceding Collection Period;
(xi) separately stated for each Loan Group, the aggregate
amount of Principal Prepayments made during the related Prepayment Period;
(xii) the aggregate amount of prepayment penalties collected
(including amounts deposited in connection with the full or partial waiver of
such prepayment penalties pursuant to Section 3.01) during the related
Collection Period and the amounts thereof allocable to the Class N Certificates
and the Class X Certificates;
(xiii) separately stated for each Loan Group, the aggregate
amount of Realized Losses incurred during the related Collection Period and the
cumulative amount of Realized Losses;
(xiv) the Certificate Principal Balance, or Notional Amount,
as applicable, of each Class of Certificates, after giving effect to the
distributions, and allocations of Realized Losses or Applied Realized Loss
Amounts, as applicable, made on such Distribution Date, separately identifying
any reduction thereof due to allocations of Realized Losses or Applied Realized
Loss Amounts;
(xv) the Accrued Certificate Interest in respect of each Class
of Offered Certificates and Class B-4 Certificates for such Distribution Date,
separately identifying the portions thereof attributable to LIBOR Carryover
Amounts, and the respective portions thereof, if any, remaining unpaid following
the distributions made in respect of such Certificates on such Distribution
Date;
(xvi) the aggregate amount of any Prepayment Interest
Shortfalls for such Distribution Date, to the extent not covered by payments by
the Servicer pursuant to Section 3.23;
(xvii) [Reserved];
(xviii) [Reserved];
(xix) the amount of the Trustee Fee paid;
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(xx) the LIBOR Carryover Amounts distributed on such
Distribution Date;
(xxi) any Overcollateralization Deficiency after giving
effect to the distribution of principal on such Distribution Date;
(xxii) whether a Trigger Event has occurred and is
continuing, and the cumulative Realized Losses, as a percentage of the original
Pool Balance;
(xxiii) the Available Funds;
(xxiv) the rate at which interest accrues for each Class of
Certificates for such Distribution Date;
(xxv) the Liquidation Report for such Distribution Date;
(xxvi) the aggregate Principal Balance of Mortgage Loans
purchased by the Servicer or Seller during the related Collection Period and
indicating the Section of this Agreement requiring or allowing the purchase of
each such Mortgage Loan;
(xxvii) the aggregate Principal Balance of the Mortgage Loans
repurchased by the Servicer (or an affiliate) during the related Collection
Period in connection with Section 3.16; and
(xxviii) the amount of the Insurer Reimbursement Amount for
such Distribution Date and the amount received by the Certificate Insurer in
respect thereof on such Distribution Date.
Parties that are unable to use ▇▇▇.▇▇▇▇▇▇.▇▇▇/▇▇▇ are entitled to have a
paper copy mailed to them via first class mail by calling the Trustee at (800)
943-6802 and indicating such. The Trustee 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 Trustee shall
provide timely and adequate notification to all above parties regarding any such
changes.
The Trustee may fully rely upon and shall have no liability with respect
to information with respect to the Mortgage Loans provided by the Servicer.
In the case of information furnished pursuant to subclauses (i) through
(iii) above, the amounts shall be expressed in a separate section of the report
as a dollar amount for each Class for each $1,000 original dollar amount as of
the Cut-off Date.
(b) Within a reasonable period of time after the end of each
calendar year, the Trustee shall furnish to each Person who at any time during
the calendar year was a Certificateholder of a Regular Certificate, if requested
in writing by such Person, such information as is reasonably necessary to
provide to such Person a statement containing the information set forth in
subclauses (i), (ii), (xv) and (xx) above, aggregated for such calendar year or
applicable portion thereof during which such Person was a Certificateholder.
Such
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obligation of the Trustee shall be deemed to have been satisfied to the extent
that substantially comparable information shall be prepared and furnished by the
Trustee to Certificateholders pursuant to any requirements of the Code as are in
force from time to time.
(c) On each Distribution Date, the Trustee shall make available to
the Residual Certificateholders a copy of the reports made available to the
Regular Certificateholders in respect of such Distribution Date with such other
information as the Trustee deems necessary or appropriate. Such obligation of
the Trustee shall be deemed to have been satisfied to the extent that
substantially comparable information shall be prepared and furnished to Residual
Certificateholders by the Trustee pursuant to any requirements of the Code as
from time to time in force.
Section 4.07 Remittance Reports; Advances.
(a) On the second Business Day following each Determination Date but
in no event less than four Business Days prior to the related Distribution Date,
the Servicer shall deliver to the Trustee by telecopy (or by such other means as
the Servicer and the Trustee may agree from time to time) a Remittance Report
with respect to the related Distribution Date. On the same date, the Servicer
shall forward to the Trustee by overnight mail a computer readable magnetic tape
or diskette or in such other medium as may be agreed between the Servicer and
the Trustee containing the information set forth in such Remittance Report with
respect to the related Distribution Date. Not later than the close of business
New York time on the Servicer Remittance Date, the Servicer shall deliver or
cause to be delivered to the Trustee in addition to the information provided on
the Remittance Report, such other information reasonably available to it with
respect to the Mortgage Loans as the Trustee may reasonably request or order in
order for the Trustee to perform the calculations necessary to make the
distributions contemplated by Section 4.01, 4.02 and 4.03 and to prepare the
statements to Certificateholders contemplated by Section 4.06. The Trustee shall
not be responsible to recompute, recalculate or verify any information provided
to it by the Servicer.
(b) The amount of Advances to be made by the Servicer for any
Distribution Date shall equal, subject to Section 4.07(d), the sum of (i) the
aggregate amount of Monthly Payments (net of the related Servicing Fee), due
during the related Collection Period in respect of the Actuarial Mortgage Loans,
which Monthly Payments were delinquent on a contractual basis as of the close of
business on the related Determination Date and (ii) with respect to each REO
Property, which REO Property was acquired during or prior to the related
Prepayment Period and as to which such REO Property an REO Disposition did not
occur during the related Prepayment Period, an amount equal to the excess, if
any, of the interest portion of Monthly Payments (net of the related Servicing
Fee) that would have been due on the related Due Date in respect of the related
Mortgage Loans, over the net income from such REO Property deposited in the
Collection Account pursuant to Section 3.13 for distribution on such
Distribution Date. 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 the such Balloon Mortgage
Loan. The Servicer shall not be obligated to make any Advance with respect to
Simple Interest Mortgage Loans and shall not make any Advances with respect to
the
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principal portion of the Monthly Payments that would have been due on the
related Due Date with respect to REO Properties or Second Lien Mortgage Loans.
On or before the close of business New York time on the Servicer
Remittance Date, the Servicer shall remit in immediately available funds to the
Trustee for deposit in the Distribution Account an amount equal to the aggregate
amount of Advances, if any, to be made in respect of the Mortgage Loans and REO
Properties for the related Distribution Date either (i) from its own funds or
(ii) from the Collection Account, to the extent of funds held therein for future
distribution (in which case it will cause to be made an appropriate entry in the
records of the Collection Account that amounts held for future distribution have
been, as permitted by this Section 4.07, used by the Servicer in discharge of
any such Advance) or (iii) in the form of any combination of (i) and (ii)
aggregating the total amount of Advances to be made by the Servicer with respect
to the Mortgage Loans and REO Properties. In addition, the Servicer shall have
the right to reimburse itself for any such Advance from amounts held from time
to time in the Collection Account to the extent such amounts are not then
required to be distributed. Any amounts held for future distribution and so used
shall be appropriately reflected in the Servicer's records and replaced by the
Servicer by deposit in the Collection Account on or before any future Servicer
Remittance Date to the extent that the Available Funds for the related
Distribution Date (determined without regard to Advances to be made on the
Servicer Remittance Date) shall be less than the total amount that would be
distributed to the Classes of Certificateholders pursuant to Section 4.01 and
4.02 on such Distribution Date if such amounts held for future distributions had
not been so used to make Advances. The Trustee will provide notice to the
Servicer by telecopy by the close of business on any Servicer Remittance Date in
the event that the amount remitted by the Servicer to the Trustee on such date
is less than the Advances required to be made by the Servicer for the related
Distribution Date, as set forth in the related Remittance Report.
(c) The obligation of the Servicer to make such Advances is
mandatory, notwithstanding any other provision of this Agreement but subject to
(d) below, and, with respect to any Mortgage Loan or REO Property, shall
continue until the earlier of such time as the Trust acquires title to the
related Mortgaged Property or such Mortgage Loan is paid in full by the
Mortgagor or disposed of by the Trust, or until the recovery of all Liquidation
Proceeds thereon.
(d) Notwithstanding anything herein to the contrary, no Advance or
Servicing Advance shall be required to be made hereunder by the Servicer if such
Advance would, if made, constitute a Nonrecoverable Advance. The determination
by the Servicer that it has made a Nonrecoverable Advance or that any proposed
Advance, if made, would constitute a Nonrecoverable Advance, shall be evidenced
by an Officers' Certificate of the Servicer delivered to the Depositor and the
Trustee.
Section 4.08 REMIC Distributions.
(a) REMIC 9. All amounts deemed distributed in respect of the REMIC
2 X/N Interest shall be treated as received by REMIC 9 then distributed by REMIC
9 in respect of the REMIC 9 X/N Interest. All allocations of Applied Realized
Loss Amounts and Realized Loss Amortization Amounts to the REMIC 2 X/N Interest
shall result in similar allocations to the REMIC 9 X/N Interest.
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(b) REMIC 8. All amounts deemed distributed in respect of the REMIC
2 B-4 Interest shall be treated as received by REMIC 8 then distributed by REMIC
8 in respect of the REMIC 8 B-4 Interest. All allocations of Applied Realized
Loss Amounts and Realized Loss Amortization Amounts to the REMIC 2 B-4 Interest
shall result in similar allocations to the REMIC 8 B-4 Interest. If on any
Distribution Date the Class Principal Balance of the Class B-4 Certificates is
increased pursuant to the last sentence of the definition of "Certificate
Principal Balance", then there shall be an equivalent increase in the principal
amount of the REMIC 8 B-4 Interest on such Distribution Date.
(c) REMIC 7. All amounts deemed distributed in respect of the REMIC
2 B-3 Interest shall be treated as received by REMIC 7 then distributed by REMIC
7 in respect of the REMIC 7 B-3 Interest. All allocations of Applied Realized
Loss Amounts and Realized Loss Amortization Amounts to the REMIC 2 B-3 Interest
shall result in similar allocations to the REMIC 7 B-3 Interest. If on any
Distribution Date the Class Principal Balance of the Class B-3 Certificates is
increased pursuant to the last sentence of the definition of "Certificate
Principal Balance", then there shall be an equivalent increase in the principal
amount of the REMIC 7 B-3 Interest on such Distribution Date.
(d) REMIC 6. All amounts deemed distributed in respect of the REMIC
2 B-2 Interest shall be treated as received by REMIC 6 then distributed by REMIC
6 in respect of the REMIC 6 B-2 Interest. All allocations of Applied Realized
Loss Amounts and Realized Loss Amortization Amounts to the REMIC 2 B-2 Interest
shall result in similar allocations to the REMIC 6 B-2 Interest. If on any
Distribution Date the Class Principal Balance of the Class B-2 Certificates is
increased pursuant to the last sentence of the definition of "Certificate
Principal Balance", then there shall be an equivalent increase in the principal
amount of the REMIC 6 B-2 Interest on such Distribution Date.
(e) REMIC 5. All amounts deemed distributed in respect of the REMIC
2 B-1 Interest shall be treated as received by REMIC 5 then distributed by REMIC
5 in respect of the REMIC 5 B-1 Interest. All allocations of Applied Realized
Loss Amounts and Realized Loss Amortization Amounts to the REMIC 2 B-1 Interest
shall result in similar allocations to the REMIC 5 B-1 Interest. If on any
Distribution Date the Class Principal Balance of the Class B-1 Certificates is
increased pursuant to the last sentence of the definition of "Certificate
Principal Balance", then there shall be an equivalent increase in the principal
amount of the REMIC 5 B-1 Interest on such Distribution Date.
(f) REMIC 4. All amounts deemed distributed in respect of the REMIC
2 M-3 Interest shall be treated as received by REMIC 4 then distributed by REMIC
4 in respect of the REMIC 4 M-3 Interest. All allocations of Applied Realized
Loss Amounts and Realized Loss Amortization Amounts to the REMIC 2 M-3 Interest
shall result in similar allocations to the REMIC 4 M-3 Interest. If on any
Distribution Date the Class Principal Balance of the Class M-3 Certificates is
increased pursuant to the last sentence of the definition of "Certificate
Principal Balance", then there shall be an equivalent increase in the principal
amount of the REMIC 4 M-3 Interest on such Distribution Date.
(g) REMIC 3. All amounts deemed distributed in respect of the REMIC
2 AF-3 Interest shall be treated as received by REMIC 3 then distributed by
REMIC 3 in respect of
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the Class AF-3 Certificates. All allocations of Applied Realized Loss Amounts
and Realized Loss Amortization Amounts to the REMIC 2 AF-3 Interest shall result
in similar allocations to the REMIC 3 AF-3 Interest. If on any Distribution Date
the Class Principal Balance of the Class AF-3 Certificates is increased pursuant
to the last sentence of the definition of "Certificate Principal Balance", then
there shall be an equivalent increase in the principal amount of the REMIC 3
AF-3 Interest on such Distribution Date.
(h) REMIC 2. On each Distribution Date, REMIC 2 shall be deemed to
have received the amounts deemed distributed in respect of the REMIC 1 Regular
Interests. Principal, interest, shortfalls and Realized Losses shall be deemed
paid to and allocated among the REMIC 2 Regular Interests in the same manner as
such items (other than payments to the Cap Carryover Certificates in respect of
LIBOR Carryover Amounts, which shall be deemed paid in respect of the REMIC 2
X/N Interest if made pursuant to Section 4.02(b)(xxvii) or (xxviii)) are paid or
allocated in respect of the related Certificates (the REMIC 2 AV-1 Interest
being related to the Class AV-1 Certificates, the REMIC 2 AF-3 Interest being
related to the Class AF-3 Certificates, the REMIC 2 M-1 Interest being related
to the Class M-1 Certificates, the REMIC 2 M-2 Interest being related to the
Class M-2 Certificates, the REMIC 2 M-3 Interest being related to the Class M-3
Certificates, the REMIC 2 B-1 Interest being related to the Class B-1
Certificates, the REMIC 2 B-2 Interest being related to the Class B-2
Certificates, the REMIC 2 B-3 Interest being related to the Class B-3
Certificates and the REMIC 2 B-4 Interest being related to the Class B-4
Certificates). On each Distribution Date, principal shall be paid to, Realized
Losses shall be allocated to and accrued but unpaid interest shall be added to
the principal amount of the REMIC 2 X/N Interest so that such principal amount
shall equal the excess of (i) the Pool Balance as of the close of the related
Collection Period over (ii) the aggregate Certificate Principal Balance of each
Class of Certificates on such Distribution Date after all principal payments
have been made and Realized Losses have been allocated to such Certificates
(other than the Class X or Class N Certificates). The portion of Available Funds
remaining in REMIC 2 on a Distribution Date after all distributions have been
made to the REMIC 2 Regular Interests shall be distributed to the Class R
Certificates in respect of the Class R-2 Interest. If on any Distribution Date
the Class Principal Balance of any Class of Certificates is increased pursuant
to the last sentence of the definition of "Certificate Principal Balance", then
there shall be an equivalent increase in the principal amounts of the REMIC 2
Regular Interests, with each Corresponding REMIC 2 Regular Interest having an
increase in its principal amount equal to the increase in the Class Principal
Balance of the Corresponding Cap Carryover Certificates (treating solely for
purposes of this sentence the Class AF-3 Certificates as Corresponding Cap
Carryover Certificates with respect to the REMIC 2 AF-3 Interest and the REMIC 2
AF-3 Interest as a Corresponding REMIC 2 Regular Interest with respect to the
Class AF-3 Certificates).
(i) REMIC 1. On each Distribution Date, the REMIC 1 Regular
Interests shall receive distributions of interest and principal equal in the
aggregate to amounts distributable pursuant to Sections 4.01 and 4.02 (other
than to the Class R Certificates pursuant the last sentence of Section 4.02(b))
from amounts on deposit in the Distribution Account. Amounts with respect to
interest shall accrue on the REMIC 1 Regular Interests at the rates specified in
the Preliminary Statement. Payments and Realized Losses shall be allocated among
the REMIC 1 Regular Interests so that (i) each of the Marker Interests shall
have a principal balance equal to 25% of the principal balance of the related
REMIC 2 Regular Interest (with, for purposes of this Section 4.08(i), the Class
AF-1 Certificates being related to the Class LT1-AF1
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Interest, the Class AF-2 Certificates being related to the Class LT1-AF2
Interest, the REMIC 2 AF-3 Interest being related to the Class LT1-AF3 Interest,
the Class AF-4 Certificates being related to the Class LT1-AF4 Interest, the
REMIC 2 AV-1 Interest being related to the Class LT1-AV1 Interest, the REMIC 2
M-1 Interest being related to the Class LT1-M1 Interest, the REMIC 2 M-2
Interest being related to the Class LT1-M2 Interest, the REMIC 2 M-3 Interest
being related to the Class LT1-M3 Interest, the REMIC 2 B-1 Interest being
related to the Class LT1-B1 Interest, the REMIC 2 B-2 Interest being related to
the Class LT1-B2 Interest, the REMIC 2 B-3 Interest being related to the Class
LT1-B3 Interest and the REMIC 2 B-4 Interest being related to the Class LT1-B4
Interest), (ii) the Class LT1-X1 Interest has a principal balance equal to the
excess of (x) 50% of the remaining principal balance of the Mortgage Loans over
(y) the aggregate principal balance of the Marker Interests (if necessary to
reflect an increase in overcollateralization, accrued and unpaid interest on the
Class LT1-X1 interest may be added to its principal amount to achieve this
result) and (iii) the aggregate principal amount of the Class LT1-IA Interest,
Class LT1-IB Interest, Class LT1-IIA Interest, Class LT1-IIB Interest and the
Class LT1-X2 Interest shall equal 50% of the remaining principal balance of the
Mortgage loans. Distributions and Realized Losses allocated to the REMIC 1
Regular Interests described in clause (iii) of the preceding sentence will be
allocated among such REMIC 1 Regular Interests in the following manner: (x)
distributions shall be deemed made to such REMIC 1 Regular Interests first, so
as to keep the principal balance of the each such REMIC 1 Regular Interest with
"B" at the end of its designation equal to 0.05% of the aggregate scheduled
principal balance of the Mortgage Loans in the related Loan Group; second, to
such REMIC 1 Regular Interests with "A" at the end of its designation so that
the uncertificated principal balance of each such REMIC 1 Regular Interest is
equal to 0.05% of the excess of (I) the aggregate scheduled principal balance of
the Mortgage Loans in the related Loan Group over (II) the aggregate principal
balance of the Class AV-1 Certificates, in the case of Loan Group I, or the
Class AF-1, Class AF-2, Class AF-3 and Class AF-4 Certificates, in the case of
Loan Group II (except that if 0.05% of any such excess is greater than the
principal amount of the corresponding REMIC 1 Regular Interest with "A" at the
end of its designation, the least amount of principal shall be distributed to
such REMIC 1 Regular Interests with "A" at the end of its designation such that
the REMIC 1 Subordinated Balance Ratio is maintained) and finally, any remaining
distributions of principal to the Class LT1-X2 Interest and (y) Realized Losses
shall be allocated among the REMIC 1 Regular Interests described in clause (iii)
of the preceding sentence in the following manner: (x) Realized Losses shall be
deemed allocated to such REMIC 1 Regular Interests first, so as to keep the
principal balance of the each such REMIC 1 Regular Interest with "B" at the end
of its designation equal to 0.05% of the aggregate scheduled principal balance
of the Mortgage Loans in the related Loan Group; second, to such REMIC 1 Regular
Interests with "A" at the end of its designation so that the uncertificated
principal balance of each such REMIC 1 Regular Interest is equal to 0.05% of the
excess of (I) the aggregate scheduled principal balance of the Mortgage Loans in
the related Loan Group over (II) the aggregate principal balance of the Class
AV-1 Certificates, in the case of Loan Group I, or the Class AF-1, Class AF-2,
Class AF-3 and Class AF-3 Certificates, in the case of Loan Group II (except
that if 0.05% of any such excess is greater than the principal amount of the
corresponding REMIC 1 Regular Interest with "A" at the end of its designation,
the least amount of Realized Losses shall be allocated to such REMIC 1 Regular
Interests with "A" at the end of its designation such that the REMIC 1
Subordinated Balance Ratio is maintained) and finally, any remaining Realized
Losses to the Class LT1-X2 Interest. Notwithstanding the preceding two
sentences, however, Realized Losses not allocated
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to any Class of Certificates will not be allocated to any REMIC 1 Regular
Interests. All computations with respect to the REMIC 1 Regular Interests shall
be taken out to ten decimal places. Any portion of Available Funds remaining in
REMIC 1 on a Distribution Date after distributions to the REMIC 1 Regular
Interests shall be distributed to the Class R Certificates in respect of the
Class R-1 Interest. If on any Distribution Date the Class Principal Balance of
any Class of Certificates is increased pursuant to the last sentence of the
definition of "Certificate Principal Balance", then there shall be an equivalent
increase in the principal amounts of the REMIC 1 Regular Interests, with such
increase allocated (before the making of distributions and the allocation of
losses on the REMIC 1 Regular Interests on such Distribution Date) among the
REMIC 1 Regular Interests so that, to the greatest extent possible, (i) each of
the Marker Interests has a principal balance equal to 25% of the principal
balance of the related REMIC 2 Regular Interest, (ii) the Class LT1-X1 Interest
has a principal balance equal to the excess of (x) 50% of the remaining
principal balance of the Mortgage Loans over (y) the aggregate principal balance
of the Marker Interests and (iii) the aggregate principal amount of the Class
LT1-IA Interest, Class LT1-IB Interest, Class LT1-IIA Interest, Class LT1-IIB
Interest and Class LT1-X2 Interest shall equal 50% of the remaining principal
balance of the Mortgage Loans. Allocations in connection with clause (iii) shall
be made so that, to the greatest extent possible, (a) the principal balance of
each REMIC 1 Regular Interest with "B" at the end of its designation equals
0.05% of the aggregate scheduled principal balance of the Mortgage Loans in
related Loan Group, (b) the principal balance of each REMIC 1 Regular Interest
with "A" at the end of its designation equals 0.05% of the excess of (x) the
aggregate scheduled principal balance of the Mortgage Loans in related Loan
Group over (y) the aggregate principal balance of the Class AV-1 Certificates in
the case of the Class LT3-IA Interest, or the Class AF-1, Class AF-2, Class AF-3
and Class AF-4 Certificates in the case of the Class LT1-IIA Interest and (c)
any remaining allocations are made to the Class LT1-X2 Interest.
(j) All prepayment penalties (including amounts deposited in
connection with the full or partial waiver of prepayment penalties pursuant to
Section 3.01) shall be distributed from REMIC 1 to REMIC 2 in respect of the
Class LT1-X1 Interest, from REMIC 2 to REMIC 9 in respect of the REMIC 2 X/N
Interest, and from REMIC 9 to the Class X/N Interest in respect of the REMIC 9
X/N Interest.
(k) Notwithstanding anything to the contrary contained herein, the
above distributions in this Section 4.08 (other than on the Certificates) are
deemed distributions, and distributions of funds from the Distribution Account
shall be made only in accordance with Sections 4.01 and 4.02 hereof.
ARTICLE V
THE CERTIFICATES
Section 5.01 The Certificates.
Each of the Class AV-1, Class AF-1, Class AF-2, Class AF-3, Class AF-4,
Class M-1, Class M-2, Class M-3, Class B-1, Class B-2, Class B-3, Class B-4,
Class N, Class X, Class R and Class R-X Certificates shall be substantially in
the forms annexed hereto as exhibits, and shall, on original issue, be executed
by the Trustee and authenticated and delivered by the
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Certificate Registrar to or upon the receipt of a Written Order to Authenticate
from the Depositor concurrently with the sale and assignment to the Trustee of
the Trust Fund. Each Class of the Offered Certificates and the Class B-4
Certificates shall be initially evidenced by one or more Certificates
representing a Percentage Interest with a minimum dollar (or notional amount)
denomination of $25,000 and integral multiples of $1 in excess thereof. The
Class N, Class X and Class R Certificates are issuable only in minimum
Percentage Interests of 10%. The Class R-X Certificates are issuable only in
minimum Percentage Interests of 50%.
The Certificates shall be executed on behalf of the Trust by manual or
facsimile signature on behalf of the Trustee by a Responsible Officer.
Certificates bearing the manual or facsimile signatures of individuals who were,
at the time when such signatures were affixed, authorized to sign on behalf of
the Trustee shall bind the Trust, notwithstanding that such individuals or any
of them have ceased to be so authorized prior to the authentication and delivery
of such Certificates or did not hold such offices at the date of such
Certificate. No Certificate shall be entitled to any benefit under this
Agreement or be valid for any purpose, unless such Certificate shall have been
manually authenticated by the Certificate Registrar substantially in the form
provided for herein, and such authentication upon any Certificate shall be
conclusive evidence, and the only evidence, that such Certificate has been duly
authenticated and delivered hereunder. All Certificates shall be dated the date
of their authentication. Subject to Section 5.02(c), the Offered Certificates
and the Class B-4 Certificates shall be Book-Entry Certificates. The Class N,
Class X, Class R and Class R-X Certificates shall not be Book-Entry Certificates
but shall be issued in fully registered certificate form.
The Class B-4 Certificates sold in offshore transactions in reliance on
Regulation S shall be issued initially in the form of one or more permanent
global certificates in definitive, fully registered form without interest
coupons with the applicable legends set forth in Exhibit B-4 hereto added to the
forms of such Certificates (each, a "Book-Entry Regulation S Global Security"),
which shall be deposited on behalf of the Holders of such Certificates
represented thereby with the Certificate Registrar, as custodian for DTC and
registered in the name of a nominee of DTC, duly executed and authenticated by
the Certificate Registrar as hereinafter provided. The aggregate principal
amounts of the Book-Entry Regulation S Global Securities may from time to time
be increased or decreased by adjustments made on the records of the Certificate
Registrar or DTC or its nominee, as the case may be, as hereinafter provided.
Section 5.02 Registration of Transfer and Exchange of Certificates.
(a) The Certificate Registrar shall cause to be kept at the
Corporate Trust Office of the Trustee a Certificate Register in which, subject
to such reasonable regulations as it may prescribe, the Certificate Registrar
shall provide for the registration of Certificates and of transfers and
exchanges of Certificates as herein provided. The Trustee shall initially serve
as Certificate Registrar for the purpose of registering Certificates and
transfers and exchanges of Certificates as herein provided. The Trustee as
Certificate Registrar shall be subject to the same standards of care,
limitations on liability and rights to indemnity as the Trustee, and the
provisions of Sections 8.01, 8.02, 8.03, 8.04, 8.05, 8.14, 8.15 and 8.16 shall
apply to the Certificate Registrar to the same extent as they apply to the
Trustee. Any Certificate Registrar appointed in accordance with this Section
5.02(a) may at any time resign by giving at least 30
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days' advance written notice of resignation to the Trustee, the Servicer and the
Depositor, such resignation to become effective upon appointment of a successor
Certificate Registrar.
Upon surrender for registration of transfer of any Certificate at any
office or agency of the Certificate Registrar maintained for such purpose
pursuant to the foregoing paragraph and, in the case of a Residual Certificate,
upon satisfaction of the conditions set forth below, the Trustee on behalf of
the Trust shall execute and the Certificate Registrar shall authenticate and
deliver, in the name of the designated transferee or transferees, one or more
new Certificates of the same aggregate Percentage Interest.
At the option of the Certificateholders, Certificates may be exchanged for
other Certificates in authorized denominations and the same aggregate Percentage
Interests, upon surrender of the Certificates to be exchanged at any such office
or agency. Whenever any Certificates are so surrendered for exchange, the
Trustee shall execute on behalf of the Trust and the Certificate Registrar shall
authenticate and deliver the Certificates which the Certificateholder making the
exchange is entitled to receive. Every Certificate presented or surrendered for
registration of transfer or exchange shall (if so required by the Trustee or the
Certificate Registrar) be duly endorsed by, or be accompanied by a written
instrument of transfer satisfactory to the Trustee and the Certificate Registrar
duly executed by, the Holder thereof or his attorney duly authorized in writing.
(b) Upon original issuance, the Book-Entry Certificates shall be
issued in the form of one or more typewritten certificates, to be delivered to
the Depository, the initial Depository, by, or on behalf of, the Depositor; or
to, and deposited with the Certificate Custodian, on behalf of the Depository,
if directed to do so pursuant to instructions from the Depository. Except as
provided in paragraph (c) below, the Book-Entry Certificates shall at all times
remain registered in the name of the Depository or its nominee and at all times:
(i) registration of such Certificates may not be transferred by the Trustee
except to another Depository; (ii) the Depository shall maintain book-entry
records with respect to the Certificate Owners and with respect to ownership and
transfers of such Certificates; (iii) ownership and transfers of registration of
such Certificates on the books of the Depository shall be governed by applicable
rules established by the Depository; (iv) the Depository may collect its usual
and customary fees, charges and expenses from its Depository Participants; (v)
the Trustee shall for all purposes deal with the Depository as representative of
the Certificate Owners of the Certificates for purposes of exercising the rights
of Holders under this Agreement, and requests and directions for and votes of
such representative shall not be deemed to be inconsistent if they are made with
respect to different Certificate Owners; (vi) the Trustee may rely and shall be
fully protected in relying upon information furnished by the Depository with
respect to its Depository Participants and furnished by the Depository
Participants with respect to indirect participating firms and Persons shown on
the books of such indirect participating firms as direct or indirect Certificate
Owners; and (vii) the direct participants of the Depository shall have no rights
under this Agreement under or with respect to any of the Certificates held on
their behalf by the Depository, and the Depository may be treated by the Trustee
and their agents, employees, officers and directors as the absolute owner of the
Certificates for all purposes whatsoever.
All transfers by Certificate Owners of Book-Entry Certificates shall be
made in accordance with the procedures established by the Depository Participant
or brokerage firm
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representing such Certificate Owners. Each Depository Participant shall only
transfer Book-Entry Certificates of Certificate Owners that it represents or of
brokerage firms for which it acts as agent in accordance with the Depository's
normal procedures. The parties hereto are hereby authorized to execute a Letter
of Representations with the Depository or take such other action as may be
necessary or desirable to register a Book-Entry Certificate to the Depository.
In the event of any conflict between the terms of any such Letter of
Representation and this Agreement, the terms of this Agreement shall control.
(c) If (i)(x) the Depository or the Depositor advises the Trustee in
writing that the Depository is no longer willing or able to discharge properly
its responsibilities as Depository and (y) the Trustee or the Depositor is
unable to locate a qualified successor, (ii) the Depositor, at its sole option,
with the consent of the Trustee, elects to terminate the book-entry system
through the Depository or (iii) after the occurrence of a Servicer Event of
Termination, the Certificate Owners of each Class of Book-Entry Certificates
representing Percentage Interests of such Classes aggregating not less than 51%
advises the Trustee and Depository through the Financial Intermediaries and the
Depository Participants in writing that the continuation of a book-entry system
through the Depository to the exclusion of definitive, fully registered
certificates (the "Definitive Certificates") to Certificate Owners is no longer
in the best interests of the Certificate Owners. Upon surrender to the
Certificate Registrar of the Book-Entry Certificates by the Depository,
accompanied by registration instructions from the Depository for registration,
the Trustee shall, at the Depositor's expense, in the case of (ii) above, or the
Seller's expense, in the case of (i) and (iii) above, execute on behalf of the
Trust and the Certificate Registrar shall authenticate the Definitive
Certificates. Neither the Depositor nor the Trustee shall be liable for any
delay in delivery of such instructions and may conclusively rely on, and shall
be protected in relying on, such instructions. Upon the issuance of Definitive
Certificates, the Trustee, the Certificate Registrar, the Servicer, any Paying
Agent and the Depositor shall recognize the Holders of the Definitive
Certificates as Certificateholders hereunder.
(d) No transfer, sale, pledge or other disposition of any Private
Certificate shall be made unless such disposition is exempt from the
registration requirements of the Securities Act of 1933, as amended (the "1933
Act"), and any applicable state securities laws or is made in accordance with
the 1933 Act and laws. In the event of any such transfer, other than the initial
transfer of the Private Certificates by the Depositor, (i) unless such transfer
is made in reliance upon Rule 144A (as evidenced by the investment letter
delivered to the Certificate Registrar, in substantially the form attached
hereto as Exhibit J) under the 1933 Act, the Certificate Registrar and the
Depositor may require a written Opinion of Counsel (which may be in-house
counsel) acceptable to and in form and substance reasonably satisfactory to the
Certificate Registrar and the Depositor that such transfer may be made pursuant
to an exemption, describing the applicable exemption and the basis therefor,
from the 1933 Act or is being made pursuant to the 1933 Act, which Opinion of
Counsel shall not be an expense of the Certificate Registrar, the Trustee or the
Depositor or (ii) the Certificate Registrar shall require the transferor to
execute a transferor certificate (in substantially the form attached hereto as
Exhibit L) and the transferee to execute an investment letter (in substantially
the form attached hereto as Exhibit J) acceptable to and in form and substance
reasonably satisfactory to the Depositor and the Certificate Registrar
certifying to the Depositor and the Certificate Registrar the facts surrounding
such transfer, which investment letter shall not be an expense of the
Certificate Registrar or the Depositor. The Holder of a Private Certificate
desiring to effect such transfer
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shall, and does hereby agree to, indemnify the Certificate Registrar and the
Depositor against any liability that may result if the transfer is not so exempt
or is not made in accordance with such federal and state laws.
By acceptance of a Regulation S Global Security, whether upon original
issuance or subsequent transfer, each Holder of such a Certificate acknowledges
the restrictions on the transfer of such Certificate set forth thereon and
agrees that it will only transfer such a Certificate as provided herein. In
addition, each Holder of a Regulation S Global Security shall be deemed to have
represented and warranted to the Depositor, the Certificate Registrar and any of
their respective successors that: (i) such Person is not a "U.S. person" within
the meaning of Regulation S and was, at the time the buy order was originated,
outside the United States and (ii) such Person understands that such
Certificates have not been registered under the Securities Act and that (x)
until the expiration of the 40-day distribution compliance period (within the
meaning of Regulation S), no offer, sale, pledge or other transfer of such
Certificates or any interest therein shall be made in the United States or to or
for the account or benefit of a U.S. person (each as defined in Regulation S),
(y) if in the future it decides to offer, resell, pledge or otherwise transfer
such Certificates, such Certificates may be offered, resold, pledged or
otherwise transferred only (A) to a person which the seller reasonably believes
is a "qualified institutional buyer" (a "QIB") as defined in Rule 144A under the
Securities Act, that is purchasing such Certificates for its own account or for
the account of a qualified institutional buyer to which notice is given that the
transfer is being made in reliance on Rule 144A or (B) in an offshore
transaction (as defined in Regulation S) in compliance with the provisions of
Regulation S, in each case in compliance with the requirements of this
Agreement; and it will notify such transferee of the transfer restrictions
specified in this Section.
The beneficial ownership (as determined for federal income tax purposes)
of a Class N or Class X Certificate shall not be transferred to a non-United
States Person unless (i) such beneficial ownership is transferred to a
non-United States Person who will at all times be a Proportionate Holder and
provides the Certificate Registrar with a representation and covenant to such
effect and (ii) the Certificate Registrar has received, in the manner required
by applicable Treasury regulations (and with all required attachments,
including, where the non-United States Person is providing a Form W-8IMY, Forms
W-8BEN or W-9 from all persons treated as beneficially owning an interest in the
Class X or Class N Certificate through such non-U.S. Person either directly,
through an intermediary or through another entity that is treated as a
partnership for U.S. federal income tax purposes), a properly completed Internal
Revenue Service Form W-8IMY, Form W-8BEN or Form W-8ECI from such non-United
States Person. No Class N or Class X Certificate may be pledged or used as
collateral for any obligation if it would cause any portion of the Trust Fund to
be treated as a taxable mortgage pool under Section 7701(i) of the Code.
No transfer of an ERISA-Restricted Certificate shall be registered unless
the Trustee and the Certificate Registrar shall have received (i) a
representation from the transferee of such Certificate, acceptable to and in
form and substance satisfactory to the Trustee and the Certificate Registrar
(such requirement is satisfied only by the Certificate Registrar's receipt of a
representation letter from the transferee substantially in the form of Exhibit I
hereto, as appropriate), to the effect that such transferee is not an employee
benefit plan or arrangement subject to Title I of ERISA, a plan subject to
Section 4975 of the Code or a plan subject to state,
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local or other federal law substantively similar to the foregoing provisions of
ERISA or the Code ("Similar Law") (collectively, a "Plan"), and is not directly
or indirectly acquiring the Certificate for, on behalf of or with any assets of
any such Plan, (ii) (except in the case of a Class R, Class R-X, Class X or
Class N Certificate) a representation that the transferee is an insurance
company that is acquiring the Certificate with assets of an "insurance company
general account" as defined in Section V(e) of Prohibited Transaction Class
Exemption ("PTCE") 95-60 and the acquisition and holding of the Certificate are
covered and exempt under Sections I and III of PTCE 95-60, or (iii) (except in
the case of a Class R or Class R-X Certificate) solely in the case of a
Definitive Certificate, an Opinion of Counsel satisfactory to the Trustee and
the Certificate Registrar, and upon which the Trustee and the Certificate
Registrar shall be entitled to rely, to the effect that the acquisition and
holding of such Certificate by the transferee will not result in a nonexempt
prohibited transaction under Title I of ERISA or Section 4975 of the Code, or a
violation of Similar Law, and will not subject the Certificate Registrar, the
Depositor, the Servicer or the Trustee to any obligation in addition to those
undertaken by such entities in the Pooling and Servicing Agreement, which
opinion of counsel shall not be an expense of the Certificate Registrar, the
Depositor, the Servicer or the Trustee. For purposes of the Class M-1, Class
M-2, Class M-3, Class B-1, Class B-2, Class B-3 and Class B-4 Certificates, the
representations in clause (i) or (ii) of the preceding sentence shall be deemed
to have been made to the Certificate Registrar and the Trustee by the
Certificate Owner's acceptance of the beneficial interest in any such class of
Certificates, unless the Trustee and the Certificate Registrar shall have
received from the transferee an alternative representation acceptable in form
and substance to the Trustee and the Certificate Registrar. In the event that
such representation is violated, and in the event that any attempt is made to
transfer to a Plan or to any person acting for, on behalf of or with any assets
of any Plan without the Opinion of Counsel described above, such attempted
transfer or acquisition shall be void and of no effect.
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 appointed the Depositor or its designee as its attorney-in-fact to
negotiate the terms of any mandatory sale under clause (v) below and to execute
all instruments of transfer and to do all other things necessary in connection
with any such sale, and the rights of each Person acquiring any Ownership
Interest in a Residual Certificate are expressly subject to the following
provisions:
(i) Each Person holding or acquiring any Ownership Interest in
a Residual Certificate shall be a Permitted Transferee and shall promptly notify
the Certificate Registrar of any change or impending change in its status as a
Permitted Transferee.
(ii) No Person shall acquire an Ownership Interest in a
Residual Certificate unless such Ownership Interest is a pro rata undivided
interest.
(iii) In connection with any proposed transfer of any
Ownership Interest in a Residual Certificate, the Certificate Registrar shall as
a condition to registration of the transfer, require delivery to it, in form and
substance satisfactory to it, of each of the following:
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(A) an affidavit in the form of Exhibit K hereto
from the proposed transferee to the effect that, among other things, such
transferee is a Permitted Transferee and 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 who is not a Permitted
Transferee; and
(B) a covenant of the proposed transferee to the
effect that the proposed transferee agrees to be bound by and to abide by the
transfer restrictions applicable to the Residual Certificates.
(iv) Any attempted or purported transfer of any
Ownership Interest in a Residual Certificate in violation of the provisions of
this Section shall be absolutely null and void and shall vest no rights in the
purported transferee. If any purported transferee shall, in violation of the
provisions of this Section, become a Holder of a Residual Certificate, then the
prior Holder of such Residual Certificate that is a Permitted Transferee shall,
upon discovery that the registration of transfer of such Residual Certificate
was not in fact permitted by this Section, be restored to all rights as Holder
thereof retroactive to the date of registration of transfer of such Residual
Certificate. The Certificate Registrar 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 or for making any distributions due on such Residual
Certificate to the Holder thereof or taking any other action with respect to
such Holder under the provisions of this Agreement so long as the Certificate
Registrar received the documents specified in clause (iii). The Trustee shall be
entitled to recover from any Holder of a Residual Certificate that was in fact
not a Permitted Transferee at the time such distributions were made all
distributions made on such Residual Certificate. Any such distributions so
recovered by the Trustee shall be distributed and delivered by the Trustee to
the prior Holder of such Residual Certificate that is a Permitted Transferee.
(v) If any Person other than a Permitted Transferee
acquires any Ownership Interest in a Residual Certificate in violation of the
restrictions in this Section, then the Certificate Registrar shall have the
right but not the obligation, without notice to the Holder of such Residual
Certificate or any other Person having an Ownership Interest therein, to notify
the Depositor to arrange for the sale of such Residual Certificate. The proceeds
of such sale, net of commissions (which may include commissions payable to the
Depositor or its affiliates in connection with such sale), expenses and taxes
due, if any, will be remitted by the Trustee to the previous Holder of such
Residual Certificate that is a Permitted Transferee, except that in the event
that the Trustee determines that the Holder of such Residual Certificate may be
liable for any amount due under this Section or any other provisions of this
Agreement, the Trustee may withhold a corresponding amount from such remittance
as security for such claim. The terms and conditions of any sale under this
clause (v) shall be determined in the sole discretion of the Trustee and it
shall not be liable to any Person having an Ownership Interest in a Residual
Certificate as a result of its exercise of such discretion.
(vi) If any Person other than a Permitted Transferee
acquires any Ownership Interest in a Residual Certificate in violation of the
restrictions in this Section, then the Trustee will provide to the Internal
Revenue Service, and to the persons specified in Sections 860E(e)(3) and (6) of
the Code, information needed to compute the tax imposed under Section 860E(e)(5)
of the Code on transfers of residual interests to disqualified organizations.
The
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Trustee shall be entitled to reasonable compensation for providing such
information from the person to whom it is provided.
The foregoing provisions of this Section shall cease to apply to transfers
occurring on or after the date on which there shall have been delivered to the
Certificate Registrar, in form and substance satisfactory to the Certificate
Registrar, (i) written notification from each Rating Agency that the removal of
the restrictions on Transfer set forth in this Section will not cause such
Rating Agency to downgrade its rating of the Certificates (and with respect to
the Insured Certificates, without regard to the Certificate Insurance Policy)
and (ii) an Opinion of Counsel to the effect that such removal will not cause
any REMIC hereunder to fail to qualify as a REMIC.
(e) No service charge shall be made for any registration of transfer
or exchange of Certificates of any Class, but the Certificate Registrar may
require payment of a sum sufficient to cover any tax or governmental charge that
may be imposed in connection with any transfer or exchange of Certificates.
All Certificates surrendered for registration of transfer or exchange
shall be cancelled by the Certificate Registrar and disposed of pursuant to its
standard procedures.
Section 5.03 Mutilated, Destroyed, Lost or Stolen Certificates.
If (i) any mutilated Certificate is surrendered to the Certificate
Registrar or the Certificate Registrar receives evidence to its satisfaction of
the destruction, loss or theft of any Certificate and (ii) there is delivered to
the Trustee, the Depositor and the Certificate Registrar such security or
indemnity as may be required by them to save each of them harmless, then, in the
absence of notice to the Trustee or the Certificate Registrar that such
Certificate has been acquired by a bona fide purchaser, the Trustee shall
execute on behalf of the Trust, and the Certificate Registrar shall authenticate
and deliver, in exchange for or in lieu of any such mutilated, destroyed, lost
or stolen Certificate, a new Certificate of like tenor and Percentage Interest.
Upon the issuance of any new Certificate under this Section, the Trustee or the
Certificate Registrar may require the payment of a sum sufficient to cover any
tax or other governmental charge that may be imposed in relation thereto and any
other expenses (including the fees and expenses of the Trustee and the
Certificate Registrar) in connection therewith. Any duplicate Certificate issued
pursuant to this Section, shall constitute complete and indefeasible evidence of
ownership in the Trust, as if originally issued, whether or not the lost, stolen
or destroyed Certificate shall be found at any time.
Section 5.04 Persons Deemed Owners.
The Servicer, the Depositor, the Trustee, the Certificate Registrar, any
Paying Agent and any agent of the Servicer, the Depositor, the Certificate
Registrar, any Paying Agent or the Trustee may treat the Person, including a
Depository, 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 4.02 and for all other purposes whatsoever, and none of the Servicer, the
Trust, the Trustee, any Paying Agent nor any agent of any of them shall be
affected by notice to the contrary.
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Section 5.05 Appointment of Paying Agent.
The Paying Agent shall make distributions to Certificateholders from the
Distribution Account pursuant to Section 4.01 and 4.02 and shall report the
amounts of such distributions to the Trustee. The duties of the Paying Agent may
include the obligation (i) to withdraw funds from the Collection Account
pursuant to Section 3.05 and for the purpose of making the distributions
referred to above and (ii) to distribute statements and provide information to
Certificateholders as required hereunder. The Paying Agent hereunder shall at
all times be an entity duly incorporated and validly existing under the laws of
the United States of America or any state thereof, authorized under such laws to
exercise corporate trust powers and subject to supervision or examination by
federal or state authorities. The Paying Agent shall initially be the Trustee.
The Trustee may appoint a successor to act as Paying Agent, which appointment
shall be reasonably satisfactory to the Depositor and the Rating Agencies. The
Trustee as Paying Agent shall be subject to the same standards of care,
limitations on liability and rights to indemnity as the Trustee, and the
provisions of Sections 8.01, 8.02, 8.03, 8.04, 8.05, 8.14, 8.15 and 8.16 shall
apply to the Paying Agent to the same extent as they apply to the Trustee. Any
Paying Agent appointed in accordance with this Section 5.05 may at any time
resign by giving at least 30 days' advance written notice of resignation to the
Trustee, the Servicer and the Depositor, such resignation to become effective
upon appointment of a successor Paying Agent.
Section 5.06 The Certificate Insurance Policy.
(a) The Trustee shall establish a separate non-interest bearing
trust account which shall be an Eligible Account for the benefit of Holders of
the Class AF-3 Certificates and the Certificate Insurer referred to herein as
the "Policy Payment Account" and distribute such amount only for purposes of
payment to the Class AF-3 Certificates of the Policy Payment for which a claim
was made and such amount may not be applied to satisfy any costs, expenses or
liabilities of the Servicer, the Trustee or the Trust Fund or to pay any other
Class of Certificates. Amounts paid under the Certificate Insurance Policy, to
the extent needed to pay any Class AF-3 Certificate Deficiency Amount, shall be
transferred to the Distribution Account on the related Distribution Date, and
the portion thereof representing the Class AF-3 Certificate Deficiency Amount
shall be disbursed by the Trustee to the Class AF-3 Certificateholders, in each
case as if it were a distribution to the Holders of such Certificates pursuant
to Section 4.01 or 4.02. It shall not be necessary for such payments to be made
by checks or wire transfers separate from the checks or wire transfers used to
pay other distributions to the Class AF-3 Certificateholders, as applicable,
with other funds available to make such payment. However, the amount of any
payment of principal or of interest on the Class AF-3 Certificates to be paid
from funds transferred from the Policy Payment Account shall be noted as
provided in paragraph (d) below and in the statement to be furnished to Holders
of such Class of Certificates pursuant to Section 4.06. Funds held in the Policy
Payment Account shall not be invested. Any funds remaining in the Policy Payment
Account on the first Business Day following a Distribution Date shall be
returned to the Certificate Insurer pursuant to the written instructions of the
Certificate Insurer by the end of such Business Day.
(b) If the Trustee has determined that a Class AF-3 Certificate
Deficiency Amount is required to be paid under the Certificate Insurance Policy
with respect to such Distribution Date, it shall deliver a Notice of Claim (in
the form attached as Exhibit A to the
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Certificate Insurance Policy) to the Certificate Insurer no later than noon, New
York, New York time on the second Business Day preceding such Distribution Date
and shall provide a copy thereof to the Servicer at or prior to the time such
Notice of Claim is received by the Certificate Insurer. The Notice of Claim
shall constitute a claim therefor pursuant to the Certificate Insurance Policy.
(c) If the Trustee receives a certified copy of a final order of the
appropriate court exercising jurisdiction in an Insolvency Proceeding with
respect to which the appeal period has expired without an appeal having been
filed (an "Order") that any prior distribution made on the Insured Certificates
constitutes an Avoided Payment and must be returned by the Certificate Owner,
the Trustee shall so notify the Certificate Insurer, shall comply with the
provisions of the Certificate Insurance Policy to obtain payment by the
Certificate Insurer of such Avoided Payment and shall, at the time it provides
notice to the Certificate Insurer, notify each holder of the affected Insured
Certificates by mail that (i) subject to the terms of the Certificate Insurance
Policy, the Certificate Insurer will disburse the Avoided Payment directly to
the receiver, conservator, debtor-in-possession or trustee in bankruptcy named
in the Order on the Business Day following such Certificateholder's making
timely delivery to the Paying Agent of (a) a certified copy of the Order, (b) an
assignment duly executed and delivered by such Certificate Owner, in the form
attached to the Certificate Insurance Policy, irrevocably assigning to the
Certificate Insurer all rights and claims of such Certificate Owner relating to
or arising under the affected Insured Certificates against the debtor that made
a payment of such Avoided Payment, or otherwise with respect to such payment and
(c) a payment notice in the form required by the Certificate Insurance Policy,
appropriately completed and executed by the Paying Agent, provided that if such
documents are received after 10:00 a.m., New York time, on such Business Day,
they will be deemed to be received on the following Business Day. A copy of the
Certificate Insurance Policy shall be made available to each affected
Certificateholder through the Trustee, and the Paying Agent shall furnish to the
Certificate Insurer or its fiscal agent, if any, a copy of its records
evidencing the payments that have been made by the Paying Agent and subsequently
recovered from Certificateholders and the dates on which such payments were
made.
(d) The Trustee shall keep a complete and accurate record of the
amount of interest and principal paid in respect of any Class AF-3 Certificates
from moneys received under the Certificate Insurance Policy. The Certificate
Insurer shall have the right to inspect such records at reasonable times during
normal business hours upon two Business Day's prior notice to the Paying Agent.
(e) The Holders of the Insured Certificates are not entitled to
institute proceedings directly against the Certificate Insurer. Each Holder of
the Insured Certificates, by its purchase of Insured Certificates hereby agrees
that the Certificate Insurer may at any time during the continuation of any
proceeding relating to an Avoided Payment, direct all matters relating to such
Avoided Payment on their behalf, including, without limitation, the direction of
any appeal of any order relating to such preference claim and the posting of any
surety, supersede as or performance bond pending any such appeal.
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(f) Any payments to the Certificate Insurer shall be made by wire
transfer of immediately available funds to the following Federal Reserve Account
(unless and until the Certificate Insurer notifies the Paying Agent of a change
in such account information in writing):
Fleet Bank, N.A.
▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇-▇▇▇▇
ABA Number: ▇▇▇▇▇▇▇▇▇
For the Account of: XL Capital Assurance Inc.
1221 Avenue of the Americas, ▇▇▇▇ ▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇-▇▇▇▇
Account #: ▇▇▇-▇▇▇-▇▇▇▇
Reference: Policy CA01172A
(g) The Trustee shall, upon retirement of the Class AF-3
Certificates, furnish to the Certificate Insurer a notice of such retirement,
and, after retirement of the Class AF-3 Certificates and the expiration of the
term of the Certificates Insurance Policy, surrender the Certificate Insurance
Policy to the Certificate Insurer for cancellation.
(h) The Trustee shall hold the Certificate Insurance Policy in trust
as agent for the Holders of the Class AF-3 Certificates for the purpose of
making claims thereon and distributing the proceeds thereof. Neither the
Certificate Insurance Policy nor the amounts paid on the Certificate Insurance
Policy shall constitute part of the Trust Fund created this Agreement. Each
Holder of Class AF-3 Certificates, by accepting its Class AF-3 Certificates
appoints the Paying Agent as attorney-in-fact for the purpose of making claims
on the Certificates Insurance Policy.
(i) The Certificate Insurace Policy will not cover any Prepayment
Interest Shortfalls or Relief Act Interest Shortfalls.
Section 5.07 Effect of Payments by the Certificate Insurer, Subrogation.
Anything herein to the contrary notwithstanding, any payment with
respect to principal of or interest on the Class AF-3 Certificates which is made
with moneys received pursuant to the terms of the Certificate Insurance Policy
shall not be considered payment of the Class AF-3 Certificates from the Trust
Fund. The Depositor, the Servicer and the Trustee acknowledge, and each Holder
by its acceptance of a Class AF-3 Certificate agrees, that without the need for
any further action on the part of the Certificate Insurer, the Depositor, the
Servicer, the Trustee or the Certificate Registrar (a) to the extent the
Certificate Insurer makes payments, directly or indirectly, on account of
principal of or interest on the Class AF-3 Certificates to the Holders of such
Class of Certificates, the Certificate Insurer shall be fully subrogated to, and
each such Certificateholder, the Servicer and the Trustee hereby delegate and
assign to the Certificate Insurer, to the fullest extent permitted by law, the
rights of such Holders to receive such principal and interest (in the manner and
order of priority in relation to other Classes of Certificates as is set forth
in this Agreement) from the Trust Fund, and (b) the Certificate Insurer shall be
paid such amounts from the sources and in the manner provided herein for the
payments of such amounts and as provided in this Agreement until full
reimbursement of all Insured
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Payments (together with interest thereon at the Pass-Through Rate form the date
paid by the Certificate Insurer until the date of reimbursement thereof). The
Trustee and the Servicer shall cooperate in all respects with any reasonable
request by the Certificate Insurer for action to preserve or enforce the
Certificate Insurer's rights or interests under this agreement without limiting
the rights or affecting the interests of the Holders of the Insured Certificates
as otherwise set forth herein.
(a) By accepting its Certificate, each Class AF-3 Certificateholder
agrees that, unless a Certificate Insurer Default exists, the Certificate
Insurer shall be deemed to be the Class AF-3 Certificateholders for all purposes
(other than with respect to the receipt of payment on such Classes of
Certificates except payments with respect to which the Certificate Insurer has
subrogation rights as set forth herein) and shall have the right to exercise all
rights of such Certificateholders under this Agreement and under the Class AF-3
Certificates without any further consent of such Certificateholders.
(b) All notices, statements, reports, certificates or opinions
required by this Agreement to be sent to any Class AF-3 Certificateholder shall
also be sent to the Certificate Insurer.
(c) (x) On the Distribution Date immediately after the expiration of
the term of the Certificate Insurance Policy (as such term is defined in the
Certificate Insurance Policy) or (y) during the occurrence of a Certificate
Insurer Default (until such time as it has been cured), the rights, consents and
notifications granted to the Certificate Insurer in this Agreement shall be
extinguished.
ARTICLE VI
THE SELLER, THE SERVICER AND THE DEPOSITOR
Section 6.01 Liability of the Seller, the Servicer and the Depositor.
The Seller and the Servicer shall be liable in accordance herewith only to
the extent of the obligations specifically imposed upon and undertaken by the
Seller or Servicer, as the case may be, herein. The Depositor shall be liable in
accordance herewith only to the extent of the obligations specifically imposed
upon and undertaken by the Depositor.
Section 6.02 Merger or Consolidation of, or Assumption of the Obligations
of, the Seller, the Servicer or the Depositor.
Any entity into which the Seller, the Servicer or the Depositor may be
merged or consolidated, or any entity resulting from any merger, conversion or
consolidation to which the Seller, the Servicer or the Depositor shall be a
party, or any corporation succeeding to the business of the Seller, the Servicer
or the Depositor, shall be the successor of the Seller, the Servicer or the
Depositor, 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
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notwithstanding; provided, however, that the successor Servicer shall satisfy
all the requirements of Section 7.02 with respect to the qualifications of a
successor Servicer.
Section 6.03 Limitation on Liability of the Servicer and Others.
Neither the Servicer nor any of the directors or officers or employees or
agents of the Servicer shall be under any liability to the Trust or the
Certificateholders for any action taken or for refraining from the taking of any
action by the Servicer in good faith pursuant to this Agreement, or for errors
in judgment; provided, however, that this provision shall not protect the
Servicer or any such Person against any liability which would otherwise be
imposed by reason of its willful misfeasance, bad faith or gross negligence in
the performance of duties of the Servicer or by reason of its reckless disregard
of its obligations and duties of the Servicer hereunder; provided, further, that
this provision shall not be construed to entitle the Servicer to indemnity in
the event that amounts advanced by the Servicer to retire any senior lien exceed
Liquidation Proceeds (in excess of related liquidation expenses) realized with
respect to the related Mortgage Loan. The Servicer and any director or officer
or employee or agent of the Servicer may rely in good faith on any document of
any kind prima facie properly executed and submitted by any Person respecting
any matters arising hereunder. The Servicer and any director or officer or
employee or agent of the Servicer shall be indemnified by the Trust and held
harmless against any loss, liability or expense incurred in connection with any
legal action relating to this Agreement or the Certificates, other than any
loss, liability or expense incurred by reason of its willful misfeasance, bad
faith or negligence in the performance of duties hereunder or by reason of its
reckless disregard of obligations and duties hereunder. The Servicer may
undertake any such action which it may deem necessary or desirable in respect of
this Agreement, and the rights and duties of the parties hereto and the
interests of the Certificateholders hereunder. In such event, the reasonable
legal expenses and costs of such action and any liability resulting therefrom
shall be expenses, costs and liabilities of the Trust and the Servicer shall be
entitled to pay such expenses from the proceeds of the Trust or to be reimbursed
therefor pursuant to Section 3.05 upon presentation to the Trustee of
documentation of such expenses, costs and liabilities. The Servicer's right to
indemnity or reimbursement pursuant to this Section shall survive any
resignation or termination of the Servicer pursuant to Section 6.04 or 7.01 with
respect to any losses, expenses, costs or liabilities arising prior to such
resignation or termination (or arising from events that occurred prior to such
resignation or termination). This paragraph shall apply to the Servicer solely
in its capacity as Servicer hereunder and in no other capacities.
Section 6.04 Servicer Not to Resign.
Subject to the provisions of Section 7.01 and Section 6.02, the Servicer
shall not resign from the obligations and duties hereby imposed on it except (i)
upon determination that the performance of its obligations or duties hereunder
are no longer permissible under applicable law or are in material conflict by
reason of applicable law with any other activities carried on by it or its
subsidiaries or Affiliates, the other activities of the Servicer so causing such
a conflict being of a type and nature carried on by the Servicer or its
subsidiaries or Affiliates at the date of this Agreement or (ii) upon
satisfaction of the following conditions: (a) the Servicer has proposed a
successor servicer to the Trustee and the Certificate Insurer in writing and
such proposed successor servicer is reasonably acceptable to the Trustee and the
Certificate Insurer; and (b) each Rating Agency shall have delivered a letter to
the Trustee prior to the appointment of the
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successor servicer stating that the proposed appointment of such successor
servicer as Servicer hereunder will not result in the reduction or withdrawal of
the then current rating of the Regular Certificates (and with respect to the
Insured Certificates, without regard to the Certificate Insurance Policy); or
the ratings that are in effect; provided, however, that no such resignation by
the Servicer shall become effective until such successor servicer or, in the
case of (i) above, the Trustee shall have assumed the Servicer's
responsibilities and obligations hereunder or the Trustee shall have designated
a successor servicer in accordance with Section 7.02. Any such resignation shall
not relieve the Servicer of responsibility for any of the obligations specified
in Sections 7.01 and 7.02 as obligations that survive the resignation or
termination of the Servicer. Any such determination permitting the resignation
of the Servicer pursuant to clause (i) above shall be evidenced by an Opinion of
Counsel to such effect delivered to the Trustee. Any such determination
permitting the resignation of the Servicer shall be evidenced by an Opinion of
Counsel to such effect delivered to the Trustee.
The Trustee, the Certificate Insurer and the Depositor hereby specifically
(i) consent to the pledge and assignment by the Servicer of all the Servicer's
right, title and interest in, to and under this Agreement to the Servicing
Rights Pledgee, for the benefit of certain lenders, and (ii) provided that no
Servicer Event of Termination exists, agree that upon delivery to the Trustee by
the Servicing Rights Pledgee of a letter signed by the Servicer whereunder the
Servicer shall resign as Servicer under this Agreement, the Trustee shall
appoint the Servicing Rights Pledgee or its designee as successor Servicer,
provided that at the time of such appointment, the Servicing Rights Pledgee or
such designee meets the requirements of a successor Servicer pursuant to Section
7.02(a) and agrees to be subject to the terms of this Agreement. If, pursuant to
any provision hereof, the duties of the Servicer are transferred to a successor,
the entire amount of the Servicing Fee and other compensation payable to the
Servicer pursuant hereto shall thereafter be payable to such successor.
Section 6.05 Delegation of Duties.
In the ordinary course of business, the Servicer at any time may delegate
any of its duties hereunder to any Person, including any of its Affiliates, who
agrees to conduct such duties in accordance with standards comparable to those
set forth in Section 3.01. Such delegation shall not relieve the Servicer of its
liabilities and responsibilities with respect to such duties and shall not
constitute a resignation within the meaning of Section 6.04. The Servicer shall
provide the Trustee, the Certificate Insurer and the Rating Agencies with 60
days prior written notice prior to the delegation of any of its duties to any
Person other than any of the Servicer's Affiliates or their respective
successors and assigns.
Section 6.06 Certificate Insurer Default.
Notwithstanding anything elsewhere in this Agreement or in the
Certificates to the contrary, if (i) a Certificate Insurer Default exists and is
continuing or (ii) if and to the extent the Certificate Insurer has delivered
its written renunciation of all of its rights under this Agreement, all
provisions of this Agreement which (a) permit the Certificate Insurer to
exercise rights of the Class AF-3 Certificateholders, (b) restrict the ability
of the Certificateholders, the Servicer or the Trustee to act without the
consent or approval of the Certificate Insurer, (c) provide that a particular
act or thing must be acceptable to the Certificate Insurer, (d) permit the
Certificate
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Insurer to direct (or otherwise to require) the actions of the Trustee, the
Servicer or the Certificateholders, (e) provide that any action or omission
taken with the consent, approval or authorization of the Certificate Insurer
shall be authorized hereunder or shall not subject the party taking or omitting
to take such action to any liability hereunder or (f) have a similar effect,
shall be of no further force and effect and the Trustee shall administer the
Trust Fund and perform its obligations hereunder solely for the benefit of the
Holders of the Certificates. Nothing in the foregoing sentence, nor any action
taken pursuant thereto or in compliance therewith shall be deemed (x) to have
release the Certificate Insurer from any obligation or liability it may have to
any party or to the Class AF-3 Certificateholders hereunder, under any other
agreement, instrument or document (including, without limitation, the
Certificate Insurance Policy) or under applicable law or (y) to have terminated
(1) the Certificate Insurer's right to receive Insurer Reimbursement Amounts
under this Agreement or its subrogation to the rights of the Holders of the
Class AF-3 Certificates under this Agreement or the Certificate Insurance
Policy, (2) the Certificate Insurer's right to receive reports and distributions
as described in this Agreement or (3) the requirement that the Certificate
Insurer approve any amendments to this Agreement that would adversely affect the
aforementioned rights. At such time as the Class AF-3 Certificates are no longer
outstanding hereunder, and no amounts owed to the Certificate Insurer hereunder
with respect to the Class AF-3 remain unpaid, the Certificate Insurer's rights
hereunder shall terminate.
ARTICLE VII
DEFAULT
Section 7.01 Servicer Events of Termination.
(a) If any one of the following events (each, a "Servicer Event of
Termination") shall occur and be continuing:
(i) (A) The failure by the Servicer to make any required
Advance; or (B) any other failure by the Servicer to deposit in the Collection
Account or Distribution Account any deposit required to be made under the terms
of this Agreement which continues unremedied for a period of one Business Day
after the date upon which written notice of such failure shall have been given
to the Servicer by the Trustee or by any Holder of a Regular Certificate
evidencing at least 25% of the Voting Rights; or
(ii) The failure by the Servicer to make any required
Servicing Advance which failure continues unremedied for a period of 30 days, or
the failure by the Servicer duly to observe or perform, in any material respect,
any other covenants, obligations or agreements of the Servicer as set forth in
this Agreement, which failure continues unremedied for a period of 30 days,
after the date (A) on which written notice of such failure, requiring the same
to be remedied, shall have been given to the Servicer by the Trustee or by any
Holder of a Regular Certificate evidencing at least 25% of the Voting Rights or
(B) actual knowledge of such failure by a Servicing Officer of the Servicer; or
(iii) The entry against the Servicer of a decree or order by a
court or agency or supervisory authority having jurisdiction in the premises for
the appointment of a trustee, conservator, receiver or liquidator in any
insolvency, conservatorship, receivership,
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readjustment of debt, marshalling of assets and liabilities or similar
proceedings, or for the winding up or liquidation of its affairs, and the
continuance of any such decree or order unstayed and in effect for a period of
60 days; or
(iv) The Servicer shall voluntarily go into liquidation,
consent to the appointment of a conservator or receiver or liquidator or similar
person in any insolvency, readjustment of debt, marshalling of assets and
liabilities or similar proceedings of or relating to the Servicer or of or
relating to all or substantially all of its property; or a decree or order of a
court or agency or supervisory authority having jurisdiction in the premises for
the appointment of a conservator, receiver, liquidator or similar person in any
insolvency, readjustment of debt, marshalling of assets and liabilities or
similar proceedings, or for the winding-up or liquidation of its affairs, shall
have been entered against the Servicer and such decree or order shall have
remained in force undischarged, unbonded or unstayed for a period of 60 days; or
the Servicer shall admit in writing its inability to pay its debts generally as
they become due, file a petition to take advantage of any applicable insolvency
or reorganization statute, make an assignment for the benefit of its creditors
or voluntarily suspend payment of its obligations; or
(v) The aggregate amount of cumulative Realized Losses
incurred since the Cut-off Date through the last day of the related Collection
Period divided by the Pool Balance as of the Cut-off Date exceeds the applicable
percentages set forth below with respect to such Distribution Date:
DISTRIBUTION DATE OCCURRING IN PERCENTAGE
------------------------------ ----------
September 2007 through August 2008 3.75%
September 2008 through August 2009 6.25%
September 2009 through August 2010 8.00%
September 2010 and thereafter 8.50%
(b) Then, and in each and every such case, so long as a Servicer
Event of Termination shall not have been remedied within the applicable grace
period, (x) with respect solely to clause (i)(A) above, if such Advance is not
made by 2:00 P.M., New York time, on the Business Day immediately following the
Servicer Remittance Date, the Trustee may terminate all of the rights and
obligations of the Servicer under this Agreement and the Trustee, or a successor
servicer appointed in accordance with Section 7.02, shall immediately make such
Advance and assume, pursuant to Section 7.02, the duties of a successor Servicer
and (y) in the case of (i)(B), (ii), (iii), (iv) and (v) above, the Trustee
shall, at the direction of the Holders of each Class of Regular Certificates
evidencing Percentage Interests aggregating not less than 51%, by notice then
given in writing to the Servicer (and to the Trustee if given by Holders of
Certificates), terminate all of the rights and obligations of the Servicer as
servicer under this Agreement. Any such notice to the Servicer shall also be
given to each Rating Agency, the Depositor and the Seller. On or after the
receipt by the Servicer (and by the Trustee if such notice is given by the
Holders) of such written notice, all authority and power of the Servicer under
this Agreement, whether with respect to the Certificates or the Mortgage Loans
or otherwise, 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 to execute and deliver, on behalf of the Servicer, as attorney-in-fact
or otherwise, any and all documents and other instruments, and to do or
accomplish all other acts or things necessary or appropriate to effect the
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purposes of such notice of termination, whether to complete the transfer and
endorsement of each Mortgage Loan and Related Documents or otherwise. The
Servicer agrees to cooperate with the Trustee (or the applicable successor
Servicer) in effecting the termination of the responsibilities and rights of the
Servicer hereunder, including, without limitation, the delivery to the Trustee
of all documents and records requested by it to enable it to assume the
Servicer's functions under this Agreement within ten Business Days subsequent to
such notice, the transfer within one Business Day subsequent to such notice to
the Trustee (or the applicable successor Servicer) for the administration by it
of all cash amounts that shall at the time be held by the Servicer and to be
deposited by it in the Collection Account, the Distribution Account, any REO
Account or any Escrow Account or that have been deposited by the Servicer in
such accounts or thereafter received by the Servicer with respect to the
Mortgage Loans or any REO Property received by the Servicer. All reasonable
costs and expenses (including attorneys' fees) incurred in connection with
transferring the servicing to the successor Servicer and amending this Agreement
to reflect such succession as Servicer pursuant to this Section shall be paid by
the predecessor Servicer (or if the predecessor Servicer is the Trustee, the
initial Servicer) upon presentation of reasonable documentation of such costs
and expenses.
Section 7.02 Trustee to Act; Appointment of Successor.
(a) Within 90 days of the time the Servicer (and the Trustee, if
notice is sent by the Holders) receives a notice of termination pursuant to
Section 7.01 or 6.04, the Trustee (or such other successor Servicer as is
approved in accordance with this Agreement) shall be the successor in all
respects to the Servicer in its capacity as servicer under this Agreement and
the transactions set forth or provided for herein and shall be subject to all
the responsibilities, duties and liabilities relating thereto placed on the
Servicer by the terms and provisions hereof arising on and after its succession.
As compensation therefor, the Trustee (or such other successor Servicer) shall
be entitled to such compensation as the Servicer would have been entitled to
hereunder if no such notice of termination had been given. Notwithstanding the
above, (i) if the Trustee is unwilling to act as successor Servicer or (ii) if
the Trustee is legally unable so to act, the Trustee shall appoint or petition a
court of competent jurisdiction to appoint, any established housing and home
finance institution, bank or other mortgage loan or home equity loan servicer
having a net worth of not less than $50,000,000 as the successor to the Servicer
hereunder in the assumption of all or any part of the responsibilities, duties
or liabilities of the Servicer hereunder; provided, that the appointment of any
such successor Servicer will not result in the qualification, reduction or
withdrawal of the ratings assigned to the Certificates or the ratings that are
in effect by the Rating Agencies as evidenced by a letter to such effect from
the Rating Agencies without regard to the Certificate Insurance Policy; and
provided further that the representations and warranties in Section 2.05 shall
be true and correct as to such successor Servicer; and provided further that
except in the case of the Servicing Rights Pledgee or its designee becoming
successor servicer as contemplated by the following paragraph, such successor
shall be approved by the Certificate Insurer in writing, which approval shall
not be unreasonably withheld. Pending appointment of a successor to the Servicer
hereunder, unless the Trustee is prohibited by law from so acting, the Trustee
shall act in such capacity as hereinabove provided. In connection with such
appointment and assumption, the successor shall be entitled to receive
compensation out of payments on Mortgage Loans in an amount equal to the
compensation which the Servicer would otherwise have received pursuant to
Section 3.18 (or such other compensation as the Trustee and such successor shall
agree, not to exceed the Servicing Fee). The successor servicer
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shall be entitled to withdraw from the Collection Account all costs and expenses
associated with the transfer of the servicing to the successor servicer. The
appointment of a successor servicer shall not affect any liability of the
predecessor Servicer which may have arisen under this Agreement prior to its
termination as Servicer to pay any deductible under an insurance policy pursuant
to Section 3.12 or to indemnify the parties indicated in Section 3.26 pursuant
to the terms thereof, nor shall any successor Servicer be liable for any acts or
omissions of the predecessor Servicer or for any breach by such Servicer of any
of its representations or warranties contained herein or in any related document
or agreement. The Trustee and such successor shall take such action, consistent
with this Agreement, as shall be necessary to effectuate any such succession.
In the event of a Servicer Event of Termination, notwithstanding anything
to the contrary above, the Trustee, the Certificate Insurer and the Depositor
hereby agree that upon delivery to the Trustee by the Servicing Rights Pledgee
of a letter signed by the Servicer within ten Business Days of when notification
of such event shall have been provided to the Trustee, whereunder the Servicer
shall resign as Servicer under this Agreement, the Servicing Rights Pledgee or
its designee shall be appointed as successor Servicer (provided that at the time
of such appointment the Servicing Rights Pledgee or such designee meets the
requirements of a successor Servicer set forth above) and the Servicing Rights
Pledgee agrees to be subject to the terms of this Agreement.
(b) Any successor, including the Trustee, to the Servicer as
servicer shall during the term of its service as servicer continue to service
and administer the Mortgage Loans for the benefit of Certificateholders, and
maintain in force a policy or policies of insurance covering errors and
omissions in the performance of its obligations as Servicer hereunder and a
Fidelity Bond in respect of its officers, employees and agents to the same
extent as the Servicer is so required pursuant to Section 3.12.
Section 7.03 Waiver of Defaults.
The Holders of Certificates entitled to at least 66 2/3% of the Voting
Rights allocated to the Class of Certificates affected by a Servicer Event of
Termination may, on behalf of all Certificateholders, waive any events
permitting removal of the Servicer as servicer pursuant to this Article VII,
provided, however, that such Holders may not waive a default in making a
required distribution on a Certificate without the consent of the Holder of such
Certificate. Upon any waiver of a past default, such default shall cease to
exist and any Servicer Event of Termination arising therefrom shall be deemed to
have been remedied for every purpose of this Agreement. No such waiver shall
extend to any subsequent or other default or impair any right consequent thereto
except to the extent expressly so waived. Notice of any such waiver shall be
given by the Trustee to the Rating Agencies.
Section 7.04 Notification to Certificateholders.
(a) On any termination or appointment of a successor the Servicer
pursuant to this Article VII or Section 6.04, the Trustee shall give prompt
written notice thereof to the Certificateholders at their respective addresses
appearing in the Certificate Register and each Rating Agency.
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(b) No later than 60 days after the occurrence of any event which
constitutes or which, with notice or a lapse of time or both, would constitute a
Servicer Event of Termination for five Business 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 Certificateholders notice of such occurrence
unless such default or Servicer Event of Termination shall have been waived or
cured. Such notice shall be given to the Rating Agencies promptly after any such
occurrence.
Section 7.05 Survivability of Servicer Liabilities.
Notwithstanding anything herein to the contrary, upon termination of the
Servicer hereunder, any liabilities of the Servicer which accrued prior to such
termination shall survive such termination.
ARTICLE VIII
THE TRUSTEE
Section 8.01 Duties of Trustee.
The Trustee, prior to the occurrence of a Servicer Event of Termination of
which a Responsible Officer of the Trustee shall have actual knowledge and after
the curing of all Servicer Events of Termination which may have occurred,
undertakes to perform such duties and only such duties as are specifically set
forth in this Agreement. If a Servicer Event of Termination has occurred (which
has not been cured) of which a Responsible Officer has actual knowledge, the
Trustee shall exercise such of the rights and powers vested in it by this
Agreement, and use the same degree of care and skill in their exercise, as a
prudent person would exercise or use under the circumstances in the conduct of
such person's own affairs.
The Trustee, upon receipt of all resolutions, certificates, statements,
opinions, reports, documents, orders or other instruments furnished to the
Trustee 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; provided, however, that that the
Trustee shall not be responsible for the accuracy or content of any resolution,
certificate, statement, opinion, report, document, order or other instrument
furnished by the Servicer, the Seller or the Depositor hereunder. If any such
instrument is found not to conform in any material respect to the requirements
of this Agreement, the Trustee shall notify the Certificateholders of such
instrument in the event that the Trustee, after so requesting, does not receive
a satisfactorily corrected instrument.
No provision of this Agreement shall be construed to relieve the Trustee
from liability for its own negligent action, its own negligent failure to act or
its own misconduct; provided, however, that:
(i) prior to the occurrence of a Servicer Event of
Termination, and after the curing of all such Servicer Events of Termination
which may have occurred, the duties and obligations of the Trustee shall be
determined solely by the express provisions of this Agreement, the Trustee shall
not be liable except for the performance of such duties and obligations as are
specifically set forth in this Agreement, no implied covenants or obligations
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shall be read into this Agreement against the Trustee and, in the absence of bad
faith on the part of the Trustee, the Trustee may conclusively rely, as to the
truth of the statements and the correctness of the opinions expressed therein,
upon any certificates or opinions furnished to the Trustee and conforming to the
requirements of this Agreement;
(ii) the Trustee shall not be personally liable for an error
of judgment made in good faith by a Responsible Officer of the Trustee unless it
shall be proved that the Trustee was negligent in ascertaining or investigating
the facts related thereto;
(iii) the Trustee shall not be personally liable with respect
to any action taken, suffered or omitted to be taken by it in good faith in
accordance with the direction of the Majority Certificateholders relating to the
time, method and place of conducting any proceeding for any remedy available to
the Trustee or exercising or omitting to exercise any trust or power conferred
upon the Trustee under this Agreement; and
(iv) the Trustee shall not be charged with knowledge of any
failure by the Servicer to comply with the obligations of the Servicer referred
to in clauses (i) and (ii) of Section 7.01(a) or any Servicer Event of
Termination unless a Responsible Officer of the Trustee at the applicable
Corporate Trust Office obtains actual knowledge of such failure or the Trustee
receives written notice of such failure from the Servicer or the Majority
Certificateholders. In the absence of such receipt of such notice, the Trustee
may conclusively assume that there is no Servicer Event of Termination.
The Trustee shall not be required to expend or risk its own funds or
otherwise incur financial liability in the performance of any of its duties
hereunder, or in the exercise of any of its rights or powers, if there is
reasonable ground for believing that the repayment of such funds or adequate
indemnity against such risk or liability is not reasonably assured to it, and
none of the provisions contained in this Agreement shall in any event require
the Trustee to perform, or be responsible for the manner of performance of, any
of the obligations of the Servicer under this Agreement, except during such
time, if any, as the Trustee shall be the successor to, and be vested with the
rights, duties, powers and privileges of, the Servicer in accordance with the
terms of this Agreement; provided, however, the Trustee shall not seek
reimbursement or repayment of any of its expenses from the Trust Fund except in
connection with expenses that would constitute "unanticipated expenses" under
Treasury Regulation 1.860G-1(b)(3)(ii).
The Trustee shall not have any duty (A) to see any recording, filing, or
depositing of this Agreement or any agreement referred to herein or any
financing statement or continuation statement evidencing a security interest, or
to see to the maintenance of any such recording or filing or depositing or to
any rerecording, refiling or redepositing of any thereof, (B) to see to any
insurance or (C) to see to the payment or discharge of any tax, assessment, or
other governmental charge or any lien or encumbrance of any kind owing with
respect to, assessed or levied against, any part of the Trust Fund other than
from funds available in the Distribution Account.
The Trustee shall have no duty hereunder with respect to any complaint,
claim, demand, notice or other document it may receive or which may be alleged
to have been delivered to or served upon it by the parties as a consequence of
the assignment of any Mortgage Loan
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hereunder; provided, however, that the Trustee shall promptly remit to the
Servicer upon receipt any such complaint, claim, demand, notice or other
document (i) which is delivered to the Trustee at its Corporate Trust Office;
(ii) of which a Responsible Officer has actual knowledge and (iii) which
contains information sufficient to permit the Trustee to make a determination
that the real property to which such document relates to is a Mortgaged
Property.
Section 8.02 Certain Matters Affecting the Trustee.
(a) Except as otherwise provided in Section 8.01:
(i) the Trustee may request and rely upon, and shall be
protected in acting or refraining from acting upon, any resolution, Officer's
Certificate, certificate of auditors or any other certificate, statement,
instrument, opinion, report, notice, request, consent, order, appraisal, bond or
other paper or document reasonably believed by it to be genuine and to have been
signed or presented by the proper party or parties;
(ii) the Trustee may consult with counsel and any advice or
Opinion of Counsel shall be full and complete authorization and protection in
respect of any action taken or suffered or omitted by it hereunder in good faith
and in accordance with such advice or Opinion of Counsel;
(iii) the Trustee shall not be under any obligation to
exercise any of the rights or powers vested in it by this Agreement, or to
institute, conduct or defend any litigation hereunder or in relation hereto, at
the request, order or direction of the Certificateholders pursuant to the
provisions of this Agreement, unless such Certificateholders shall have offered
to the Trustee reasonable security or indemnity against the costs, expenses and
liabilities which may be incurred therein or thereby; the right of the Trustee
to perform any discretionary act enumerated in this Agreement shall not be
construed as a duty, and the Trustee shall not be answerable for other than its
negligence or willful misconduct in the performance of any such act;
(iv) the Trustee shall not be personally 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 Servicer Event of Termination
and after the curing of all Servicer Events of Termination which may have
occurred, the Trustee shall not be bound to make any investigation into the
facts or matters stated in any resolution, certificate, statement, instrument,
opinion, report, notice, request, consent, order, approval, bond or other paper
or documents, unless requested in writing to do so by the Majority
Certificateholder; provided, however, that if the payment within a reasonable
time to the Trustee of the costs, expenses or liabilities likely to be incurred
by it in the making of such investigation is, in the opinion of the Trustee not
reasonably assured to the Trustee by the security afforded to it by the terms of
this Agreement, the Trustee may require reasonable indemnity against such cost,
expense or liability as a condition to such proceeding. The reasonable expense
of every such examination shall be paid by the Servicer or, if paid by the
Trustee shall be reimbursed by the Servicer upon demand. Nothing in this clause
(v) shall derogate from the obligation of the
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Servicer to observe any applicable law prohibiting disclosure of information
regarding the Mortgagors;
(vi) the Trustee shall not be accountable, shall have any
liability or make any representation as to any acts or omissions hereunder of
the Servicer until such time as the Trustee may be required to act as Servicer
pursuant to Section 7.02;
(vii) 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 or a custodian and the Trustee shall not be responsible for
any misconduct or negligence on the part of any such agent, attorney or
custodian appointed by it with due care; and
(viii) the right of the Trustee to perform any discretionary
act enumerated in this Agreement shall not be construed as a duty, and the
Trustee shall not be answerable for other than its negligence or willful
misconduct in the performance of such act.
Section 8.03 Trustee Not Liable for Certificates or Mortgage Loans.
The recitals contained herein and in the Certificates (other than the
authentication of the Trustee on the Certificates) shall be taken as the
statements of the Seller, and the Trustee does not assumes any responsibility
for the correctness of the same. The Trustee makes no representations as to the
validity or sufficiency of this Agreement or of the Certificates (other than the
signature and authentication of the Trustee on the Certificates) or of any
Mortgage Loan or Related Document. The Trustee shall not be accountable for the
use or application by the Servicer, or for the use or application of any funds
paid to the Servicer in respect of the Mortgage Loans or deposited in or
withdrawn from the Collection Account by the Servicer. The Trustee shall not at
any time have any responsibility or liability for or with respect to the
legality, validity and enforceability of any Mortgage or any Mortgage Loan, or
the perfection and priority of any Mortgage or the maintenance of any such
perfection and priority, or for or with respect to the sufficiency of the Trust
or its ability to generate the payments to be distributed to Certificateholders
under this Agreement, including, without limitation: the existence, condition
and ownership of any Mortgaged Property; the existence and enforceability of any
hazard insurance thereon (other than if the Trustee shall assume the duties of
the Servicer pursuant to Section 7.02); the validity of the assignment of any
Mortgage Loan to the Trustee or of any intervening assignment; the completeness
of any Mortgage Loan; the performance or enforcement of any Mortgage Loan (other
than if the Trustee shall assume the duties of the Servicer pursuant to Section
7.02); the compliance by the Depositor, the Seller or the Servicer with any
warranty or representation made under this Agreement or in any related document
or the accuracy of any such warranty or representation prior to the Trustee's
receipt of notice or other discovery of any non-compliance therewith or any
breach thereof; any investment of monies by or at the direction of the Servicer
or any loss resulting therefrom, it being understood that the Trustee shall
remain responsible for any Trust property that it may hold in its individual
capacity; the acts or omissions of any of the Servicer (other than if the
Trustee shall assume the duties of the Servicer pursuant to Section 7.02), or
any Mortgagor; any action of the Servicer (other than if the Trustee shall
assume the duties of the Servicer pursuant to Section 7.02), taken in the name
of the Trustee; the failure of the Servicer to act or perform any duties
required of it as agent of the Trustee hereunder; or any action by the Trustee
taken at the instruction of the
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Servicer (other than if the Trustee shall assume the duties of the Servicer
pursuant to Section 7.02); provided, however, that the foregoing shall not
relieve the Trustee of its obligation to perform its duties under this
Agreement. The Trustee shall not have any responsibility for filing any
financing or continuation statement in any public office at any time or to
otherwise perfect or maintain the perfection of any security interest or lien
granted to it hereunder.
Section 8.04 Trustee May Own Certificates.
The Trustee in its individual or any other capacity may become the owner
or pledgee of Certificates with the same rights as it would have if it were not
Trustee and may transact any banking and trust business with the Seller, the
Servicer, the Depositor or their Affiliates.
Section 8.05 Seller to Pay Trustee Fees and Expenses.
The Trustee shall withdraw from the Distribution Account on each
Distribution Date and pay to itself the Trustee Fee pursuant to Section 4.01(i)
and, to the extent the Interest Remittance Amount is at any time insufficient
for such purpose, the Seller shall pay such fees as reasonable compensation
(which shall not be limited by any provision of law in regard to the
compensation of a trustee of an express trust) for all services rendered by it
in the execution of the trusts hereby created and in the exercise and
performance of any of the powers and duties hereunder of the Trustee, and the
Seller will pay or reimburse the Trustee upon their request for all reasonable
expenses, disbursements and advances incurred or made by the Trustee in
accordance with any of the provisions of this Agreement (including the
reasonable compensation and the expenses and disbursements of its counsel and of
all persons not regularly in its employ) except any such expense, disbursement
or advance as may arise from such party's negligence or bad faith or which is
the responsibility of Certificateholders, the Trustee hereunder. Notwithstanding
any other provision of this Agreement, including Section 2.03(a) and Section
2.04, to the contrary, the Seller covenants and agrees to indemnify the Trustee
and its officers, directors, employees and agents from, and hold each of them
harmless against, any and all losses, liabilities, damages, claims or expenses
incurred in connection with (a) any legal action relating to this Agreement, the
Certificates or incurred in connection with the administration of the Trust,
other than with respect to a party, any loss, liability or expense incurred by
reason of willful misfeasance, bad faith or negligence of such party in the
performance of its duties hereunder or by reason of such party's reckless
disregard of obligations and duties hereunder and (b) the second paragraph of
Section 2.01. Anything in this Agreement to the contrary notwithstanding, in no
event shall the Trustee be liable for special, indirect or consequential loss or
damage of any kind whatsoever (including but not limited to lost profits), even
if the Trustee has been advised of the likelihood of such loss or damage and
regardless of the form of action. The Trustee and any director, officer,
employee or agent of the Trustee shall be indemnified, to the extent not paid by
the Seller pursuant to this Section, by the Trust Fund and held harmless against
any loss, liability or expense (not including expenses, disbursements and
advances incurred or made by the Trustee, in the ordinary course of the
Trustee's performance in accordance with the provisions of this Agreement)
incurred by the Trustee or such party arising out of or in connection with the
acceptance or administration of its duties under this Agreement, other than any
loss, liability or expense incurred by reason of willful misfeasance, bad faith
or negligence in the performance by the Trustee of its duties under this
Agreement or by reason of the reckless disregard of the
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Trustee's obligations and duties under this Agreement. This section shall
survive termination of this Agreement or the resignation or removal of any
Trustee hereunder.
Section 8.06 Eligibility Requirements for Trustee.
The Trustee hereunder shall at all times be a Department of Housing and
Urban Development and Federal Housing Administration approved mortgagee, an
entity duly organized and validly existing under the laws of the United States
of America or any state thereof, authorized under such laws to exercise
corporate trust powers, having a combined capital and surplus of at least
$50,000,000 and a minimum long-term debt rating of BBB by Fitch and S&P and a
long term debt rating of at least A1 or better by ▇▇▇▇▇'▇, and subject to
supervision or examination by federal or state authority. If such entity
publishes reports of condition at least annually, pursuant to law or to the
requirements of the aforesaid supervising or examining authority, then for the
purposes of this Section 8.06, the combined capital and surplus of such entity
shall be deemed to be its combined capital and surplus as set forth in its most
recent report of condition so published. The principal office of the Trustee
(other than the initial Trustee) shall be in a state with respect to which an
Opinion of Counsel has been delivered to such Trustee at the time such Trustee
is appointed Trustee to the effect that the Trust will not be a taxable entity
under the laws of such state. In case at any time the Trustee shall cease to be
eligible in accordance with the provisions of this Section 8.06, the Trustee
shall resign immediately in the manner and with the effect specified in Section
8.07.
Section 8.07 Resignation or Removal of Trustee.
The Trustee may at any time resign and be discharged from the trusts
hereby created by giving written notice thereof to the Depositor, the Servicer
and each Rating Agency. Upon receiving such notice of resignation, the Depositor
shall promptly appoint a successor Trustee approved by the Certificate Insurer
in writing, which approval shall not be unreasonably withheld, by written
instrument, in duplicate, one copy of which instrument shall be delivered to the
resigning Trustee and one copy to the successor Trustee. If no successor Trustee
shall have been so appointed and having accepted appointment within 30 days
after the giving of such notice of resignation, the resigning Trustee may
petition any court of competent jurisdiction for the appointment of a successor
Trustee.
If at any time the Trustee shall cease to be eligible in accordance with
the provisions of Section 8.06 and shall fail to resign after written request
therefor by the Depositor, or if at any time the Trustee shall be legally unable
to act, or shall be adjudged a bankrupt or insolvent, or a receiver of the
Trustee or of its property shall be appointed, or any public officer shall take
charge or control of the Trustee or of its property or affairs for the purpose
of rehabilitation, conservation or liquidation, then the Depositor may remove
the Trustee. If the Depositor or the Servicer removes the Trustee under the
authority of the immediately preceding sentence, the Depositor shall promptly
appoint a successor Trustee by written instrument, in duplicate, one copy of
which instrument shall be delivered to the Trustee so removed and one copy to
the successor Trustee.
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The Majority Certificateholders may at any time remove the Trustee by
written instrument or instruments delivered to the Servicer, the Depositor and
the Trustee; the Depositor shall thereupon use its best efforts to appoint a
successor Trustee in accordance with this Section.
Any resignation or removal of the Trustee and appointment of a successor
Trustee pursuant to any of the provisions of this Section 8.07 shall not become
effective until acceptance of appointment by the successor Trustee as provided
in Section 8.08.
Section 8.08 Successor Trustee.
Any successor Trustee appointed as provided in Section 8.07 shall execute,
acknowledge and deliver to the Depositor, the Rating Agencies, the Servicer and
to its predecessor Trustee an instrument accepting such appointment hereunder,
and thereupon the resignation or removal of the predecessor Trustee shall become
effective, and such successor Trustee, without any further act, deed or
conveyance, shall become fully vested with all the rights, powers, duties and
obligations of its predecessor hereunder, with like effect as if originally
named as Trustee. The Depositor, the Servicer and the predecessor Trustee shall
execute and deliver such instruments and do such other things as may reasonably
be required for fully and certainly vesting and confirming in the successor
Trustee all such rights, powers, duties and obligations.
No successor Trustee shall accept appointment as provided in this Section
8.08 unless at the time of such acceptance such successor Trustee shall be
eligible under the provisions of Section 8.06 and the appointment of such
successor Trustee shall not result in a downgrading of the Regular Certificates
by either Rating Agency, as evidenced by a letter from each Rating Agency.
Upon acceptance of appointment by a successor Trustee as provided in this
Section 8.08, the successor Trustee shall mail notice of the appointment of a
successor Trustee hereunder to all Holders of Certificates at their addresses as
shown in the Certificate Register and to each Rating Agency.
Section 8.09 Merger or Consolidation of Trustee.
Any entity into which the Trustee may be merged or converted or with which
it may be consolidated, or any entity resulting from any merger, conversion or
consolidation to which the Trustee shall be a party, or any entity succeeding to
the business of the Trustee, shall be the successor of the Trustee hereunder,
provided such entity shall be eligible under the provisions of Section 8.06 and
8.08, 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 8.10 Appointment of Co-Trustee or Separate Trustee.
Notwithstanding any other provisions of this Agreement, at any time, for
the purpose of meeting any legal requirements of any jurisdiction in which any
part of the Trust or any Mortgaged Property may at the time be located, the
Depositor and the Trustee acting jointly shall have the power and shall execute
and deliver all instruments to appoint one or more Persons approved by the
Trustee to act as co-trustee or co-trustees, jointly with the Trustee, or
separate trustee or separate trustees, of all or any part of the Trust, and to
vest in such Person or Persons,
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in such capacity and for the benefit of the Certificateholders, such title to
the Trust, or any part thereof, and, subject to the other provisions of this
Section 8.10, such powers, duties, obligations, rights and trusts as the
Servicer and the Trustee may consider necessary or desirable. Any such
co-trustee or separate trustee shall be subject to the written approval of the
Servicer. If the Servicer shall not have joined in such appointment within 15
days after the receipt by it of a request so to do, or in the case a Servicer
Event of Termination shall have occurred and be continuing, the Trustee alone
shall have the power to make such appointment. No co-trustee or separate trustee
hereunder shall be required to meet the terms of eligibility as a successor
Trustee under Section 8.06, and no notice to Certificateholders of the
appointment of any co-trustee or separate trustee shall be required under
Section 8.08. The Servicer shall be responsible for the fees of any co-trustee
or separate trustee appointed hereunder.
Every separate trustee and co-trustee shall, to the extent permitted by
law, be appointed and act subject to the following provisions and conditions:
(i) 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 (it
being understood that such separate trustee or co-trustee is not authorized to
act separately without the Trustee joining in such act), except to the extent
that under any law of any jurisdiction in which any particular act or acts are
to be performed (whether as Trustee hereunder or as successor to the Servicer
hereunder), the Trustee shall be incompetent or unqualified to perform such act
or acts, in which event such rights, powers, duties and obligations (including
the holding of title to the Trust or any portion thereof in any such
jurisdiction) shall be exercised and performed singly by such separate trustee
or co-trustee, but solely at the direction of the Trustee;
(ii) no trustee hereunder shall be held personally liable by
reason of any act or omission of any other trustee hereunder; and
(iii) the Servicer and the Trustee, acting jointly may at any
time accept the resignation of or remove any separate trustee or co-trustee
except that following the occurrence of a Servicer Event of Termination, the
Trustee acting alone may accept the resignation or remove any separate trustee
or co-trustee.
Any notice, request or other writing given to the Trustee shall be deemed
to have been given to each of the 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 VIII. Each separate trustee and co-trustee, upon its acceptance
of the trusts conferred, shall be vested with the estates or property specified
in its instrument of appointment, either jointly with the Trustee or separately,
as may be provided therein, subject to all the provisions of this Agreement,
specifically including every provision of this Agreement relating to the conduct
of, affecting the liability of, or affording protection to, the Trustee. Every
such instrument shall be filed with the Trustee and a copy thereof given to the
Depositor, the Rating Agencies and the Servicer.
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
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lawful act under or in respect of this Agreement on its behalf and in its name.
If any separate trustee or co-trustee shall die, become incapable of acting,
resign or be removed, all of its estates, properties, rights, remedies and
trusts shall vest in and be exercised by the Trustee, to the extent permitted by
law, without the appointment of a new or successor Trustee.
Section 8.11 Limitation of Liability.
The Certificates are executed by the Trustee, not in its individual
capacity but solely as Trustee of the Trust, in the exercise of the powers and
authority conferred and vested in it by this Agreement. Each of the undertakings
and agreements made on the part of the Trustee in the Certificates is made and
intended not as a personal undertaking or agreement by the Trustee but is made
and intended for the purpose of binding only the Trust.
Section 8.12 Trustee May Enforce Claims Without Possession of
Certificates.
(a) All rights of action and claims under this Agreement or the
Certificates may be prosecuted and enforced by the Trustee without the
possession of any of the Certificates or the production thereof in any
proceeding relating thereto, and such proceeding instituted by the Trustee shall
be brought in its own name or in its capacity as Trustee for the benefit of all
Holders of such Certificates, subject to the provisions of this Agreement. Any
recovery of judgment shall, after provision for the payment of the reasonable
compensation, expenses, disbursement and advances of the Trustee, its agents and
counsel, be for the ratable benefit of the Certificateholders in respect of
which such judgment has been recovered.
(b) The Trustee shall afford the Seller, the Depositor, the Servicer
and each Certificateholder upon reasonable notice during normal business hours,
access to all records maintained by the Trustee in respect of its duties
hereunder and access to officers of the Trustee responsible for performing such
duties. The Trustee shall cooperate fully with the Seller, the Servicer, the
Depositor and such Certificateholder and shall make available to the Seller, the
Servicer, the Depositor and such Certificateholder for review and copying at the
expense of the party requesting such copies, such books, documents or records as
may be requested with respect to the Trustee's duties hereunder. The Seller, the
Depositor, the Servicer and the Certificateholders shall not have any
responsibility or liability for any action or failure to act by the Trustee and
are not obligated to supervise the performance of the Trustee under this
Agreement or otherwise.
Section 8.13 Suits for Enforcement.
In case a Servicer Event of Termination or other default by the Servicer
or the Seller hereunder shall occur and be continuing, the Trustee may proceed
to protect and enforce its rights and the rights of the Certificateholders under
this Agreement by a suit, action or proceeding in equity or at law or otherwise,
whether for the specific performance of any covenant or agreement contained in
this Agreement or in aid of the execution of any power granted in this Agreement
or for the enforcement of any other legal, equitable or other remedy, as the
Trustee, being advised by counsel, and subject to the foregoing, shall deem most
effectual to protect and enforce any of the rights of the Trustee and the
Certificateholders.
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Section 8.14 Waiver of Bond Requirement.
The Trustee shall be relieved of, and each Certificateholder hereby
waives, any requirement of any jurisdiction in which the Trust, or any part
thereof, may be located that the Trustee post a bond or other surety with any
court, agency or body whatsoever.
Section 8.15 Waiver of Inventory, Accounting and Appraisal Requirement.
The Trustee shall be relieved of, and each Certificateholder hereby
waives, any requirement of any jurisdiction in which the Trust, or any part
thereof, may be located that the Trustee file any inventory, accounting or
appraisal of the Trust with any court, agency or body at any time or in any
manner whatsoever.
Section 8.16 Compliance with National Housing Act of 1934.
In performing its duties hereunder with respect to FHA Loans, the Trustee
shall comply with all requirements of the National Housing Act of 1934, as
amended.
ARTICLE IX
REMIC AND GRANTOR TRUST ADMINISTRATION
Section 9.01 REMIC Administration.
(a) The Trustee shall make or cause to be made REMIC elections for
each of REMIC 1, REMIC 2, REMIC 3, REMIC 4, REMIC 5, REMIC 6, REMIC 7, REMIC 8
and REMIC 9 as set forth in the Preliminary Statement on Forms 1066 or other
appropriate federal tax or information return for the taxable year ending on the
last day of the calendar year in which the Certificates are issued. The regular
interests and residual interest in each REMIC shall be as designated in the
Preliminary Statement.
(b) The Closing Date is hereby designated as the "Startup Day" of
each REMIC within the meaning of section 860G(a)(9) of the Code.
(c) The Servicer shall pay any and all tax related expenses (not
including taxes) of each REMIC, including but not limited to any professional
fees or expenses related to audits or any administrative or judicial proceedings
with respect to such REMIC that involve the Internal Revenue Service or state
tax authorities, but only to the extent that (i) such expenses are ordinary or
routine expenses, including expenses of a routine audit but not expenses of
litigation (except as described in (ii)); or (ii) such expenses or liabilities
(including taxes and penalties) are attributable to the negligence or willful
misconduct of the Servicer in fulfilling its duties hereunder. The Servicer
shall be entitled to reimbursement of expenses to the extent provided in clause
(i) above from the Collection Account, but only to the extent that such expenses
are "unanticipated expenses" under Treasury Regulations Section
1.860G-1(b)(3)(ii).
(d) The Trustee shall prepare or cause to be prepared, sign and file
or cause to be filed, each REMIC's federal and state tax and information returns
as such REMIC's direct representative. The expenses of preparing and filing such
returns shall be borne by the Trustee.
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(e) The Holder of the Residual Certificates with respect to each
REMIC holding the largest Percentage Interest shall be the "tax matters person"
as defined in the REMIC Provisions (the "Tax Matters Person") with respect to
the applicable REMIC or REMICs, and the Trustee is irrevocably designated as and
shall act as attorney-in-fact and agent for such Tax Matters Person for each
REMIC. The Trustee, as agent for the Tax Matters Person, shall perform, on
behalf of each REMIC, all reporting and other tax compliance duties that are the
responsibility of such REMIC under the Code, the REMIC Provisions, or other
compliance guidance issued by the Internal Revenue Service or any state or local
taxing authority. Among its other duties, if required by the Code, the REMIC
Provisions, or other such guidance, the Trustee, as agent for the Tax Matters
Person, shall provide (i) to the Treasury or other governmental authority such
information as is necessary for the application of any tax relating to the
transfer of a Residual Certificate to any disqualified person or organization
and (ii) to the Certificateholders such information or reports as are required
by the Code or REMIC Provisions.
(f) The Trustee, the Servicer, and the Holders of Certificates shall
take any action or cause any REMIC to take any action necessary to create or
maintain the status of such REMIC as a REMIC under the REMIC Provisions and
shall assist each other as necessary to create or maintain such status. Neither
the Trustee, the Servicer, nor the Holder of any Residual Certificate shall take
any action or cause any REMIC to take any action or fail to take (or fail to
cause to be taken) any action that, under the REMIC Provisions, if taken or not
taken, as the case may be, could (i) endanger the status of such REMIC as a
REMIC or (ii) result in the imposition of a tax upon such REMIC (including but
not limited to the tax on prohibited transactions as defined in Code Section
860F(a)(2) and the tax on prohibited contributions set forth on Section 860G(d)
of the Code) (either such event, an "Adverse REMIC Event") unless such action or
failure to take such action is expressly permitted under the terms of this
Agreement or the Trustee and the Servicer have received an Opinion of Counsel
(at the expense of the party seeking to take such action) to the effect that the
contemplated action will not endanger such status or result in the imposition of
such a tax. In addition, prior to taking any action with respect to any REMIC or
the assets therein, or causing such REMIC to take any action, which is not
expressly permitted under the terms of this Agreement, any Holder of a Residual
Certificate will consult with the Trustee and the Servicer, or their respective
designees, in writing, with respect to whether such action could cause an
Adverse REMIC Event to occur with respect to such REMIC, and no such Person
shall take any such action or cause such REMIC to take any such action as to
which the Trustee or the Servicer has advised it in writing that an Adverse
REMIC Event could occur.
(g) Each Holder of a Residual Certificate shall pay when due its pro
rata share of any and all taxes imposed on any REMIC by federal or state
governmental authorities. To the extent that such REMIC taxes are not paid by
Residual Certificateholders, the Trustee shall pay any remaining REMIC taxes out
of current or future amounts otherwise distributable to the Holder of the
Residual Certificate in each REMIC or, if no such amounts are available, out of
other amounts held in the Collection Account, and shall reduce amounts otherwise
payable to Holders of the REMIC Regular Interests or the Certificates, as the
case may be.
(h) The Trustee, shall, for federal income tax purposes, maintain or
cause to be maintained books and records with respect to each REMIC on a
calendar year and on an accrual basis.
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(i) No additional contributions of assets shall be made to any
REMIC, except as expressly provided in this Agreement with respect to Eligible
Substitute Mortgage Loans.
(j) Neither the Trustee nor the Servicer shall enter into any
arrangement by which any REMIC will receive a fee or other compensation for
services.
(k) On or before April 15 of each calendar year beginning in 2005,
the Servicer shall deliver to the Trustee and each Rating Agency an Officer's
Certificate stating the Servicer's compliance with the provisions of this
Section 9.01.
(l) The Trustee shall treat the rights of the Cap Carryover
Certificates to receive LIBOR Carryover Amounts as a right in interest rate cap
contracts written by the Holder of the Class X/N Interest, in favor of the
Holders of the Cap Carryover Certificates, and the Trustee shall account for
such as property held separate and apart from the regular interests it holds in
each of the REMICs created hereunder. This provision is intended to satisfy the
requirements of Treasury Regulations Section 1.860G-2(i) for the treatment of
property rights coupled with regular interests to be separately respected and
shall be interpreted consistent with such regulation. On each Distribution Date,
to the extent the Cap Carryover Certificates receive payments in respect of
LIBOR Carryover Amounts pursuant to Section 4.02(b)(xxvii) or (xxviii), such
interest will be treated as distributed to the REMIC 2 X/N Interest, then on the
REMIC 9 X/N Interest and then paid to the respective Class of Cap Carryover
Certificates pursuant to the related interest rate cap agreement.
(m) [RESERVED]
(n) In the event that the beneficial ownership of the Class N
Certificates and the Class X Certificates is held by a single Person for federal
income tax purposes, such Person shall be treated as the beneficial owner of the
Class X/N Interest and the REMIC 9 Regular Interest represented thereby. In the
event that beneficial ownership of the Class N and the Class X Certificates is
held by two or more Persons for tax purposes, the Trustee shall treat the Class
N Certificateholders and the Class X Certificateholders as partners in a
partnership that owns the Class X/N Interest and the REMIC 9 Regular Interest
represented thereby for federal income tax purposes and shall not treat the
Class N and Class X Certificates as an interest in any REMIC created hereunder.
By acquiring the Class N Certificates and the Class X Certificates, the
respective Holders will agree to treat the Class N Certificates and the Class X
Certificates in the manner described in the preceding sentence for federal
income tax purposes in the event that the beneficial ownership of the Class N
Certificates and the Class X Certificates is separated. In such event, (i) a
separate capital account shall be established and maintained for each Holder of
a Class N or Class X Certificate in accordance with Treasury Regulations Section
1.704-1(b)(2)(iv), which shall be credited with income or gain and debited by
any expenses or losses and distributions allocable to such Certificates, (ii)
the Class N Certificates shall be allocated income in an amount equal to
interest at the Pass-Through Rate thereon and any original issue discount that
would be reportable thereon if the Class N Certificate were a debt instrument
issued on the date ownership of the Class N and Class X Certificates is
separated, with a principal balance equal to its Notional Amount, (iii) the
Class X and Class N Certificates shall be allocated income with respect to all
prepayment penalties (including amounts in connection with the full or partial
waiver of such prepayment penalties or premiums pursuant to Section 3.01) in
accordance
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with the allocation of such amounts pursuant to Section 4.02(c), to the extent
not allocated pursuant to Section 9.01(n)(ii) above, (iv) the Class X and Class
N Certificates shall be allocated accruals (under any reasonable method) of any
"cap premiums" deemed received on the date ownership of the Class X and Class N
Certificates is separated in respect of the obligation of the Class X/N Interest
to pay LIBOR Carryover Amounts, and shall be allocated expense in respect of
such LIBOR Carryover Amounts based on which one of such Classes economically
bears such expense, (v) the Class X Certificates shall be allocated all
remaining income and any expenses and Realized Losses with respect to the Class
X/N Interest, until the capital account of the Class X Certificates is reduced
to zero, and any remaining expenses or losses shall be allocated to the Class N
Certificates, (vi) neither the Class N Certificates nor the Class X Certificates
shall be responsible for restoring any deficit to its capital account, (vii)
upon termination of the Trust Fund pursuant to Article X, all amounts available
for distribution to Holders of the Class N and Class X Certificates shall be
distributed in accordance with their positive capital account balances, first to
the Class N Certificates until their Notional Amount and any accrued but unpaid
interest thereon are reduced to zero, and then to the Class X Certificates, and
(viii) the Trustee shall maintain books and records with respect to the
partnership on a calendar year basis (unless a different taxable year shall be
required by the Code) and shall prepare or cause to be prepared, and cause the
Holder of the largest Percentage Interest of the Class X Certificates to sign
and file or cause to be filed all federal and state tax and information returns
for the partnership, and shall furnish or cause to be furnished Schedule K-1 to
the Holders of the Class N and Class X Certificates at the time required by the
Code. Unless otherwise directed by a majority of the Percentage Interests of the
Class X and Class N Certificates, the Trustee shall not make an election under
Section 754 of the Code. The Holder of the largest Percentage Interest of the
Class X Certificates, by acceptance of its Class X Certificate, agrees to act as
"tax matters partner" (within the meaning of Section 6231(a)(7) of the Code) and
to sign and timely file all federal and state partnership tax and information
returns prepared by the Trustee pursuant to this Section 9.01(n).
Section 9.02 Prohibited Transactions and Activities.
Neither the Seller, the Depositor, the Servicer nor the Trustee shall
sell, dispose of, or substitute for any of the Mortgage Loans, except in a
disposition pursuant to (i) the foreclosure of a Mortgage Loan, (ii) the
bankruptcy of the Trust Fund, (iii) the termination of any REMIC pursuant to
Article X of this Agreement, (iv) a substitution pursuant to Article II of this
Agreement or (v) a repurchase of Mortgage Loans pursuant to Article II of this
Agreement, nor acquire any assets for any REMIC constituting part of the Trust
Fund, nor sell or dispose of any investments in the Distribution Account for
gain, nor accept any contributions to any REMIC constituting part of the Trust
Fund after the Closing Date, unless it has received an Opinion of Counsel (at
the expense of the party causing such sale, disposition, or substitution) that
such disposition, acquisition, substitution, or acceptance will not (a) affect
adversely the status of such REMIC as a REMIC or of the interests therein other
than the Residual Certificates as the regular interests therein, (b) affect the
distribution of interest or principal on the Certificates, (c) result in the
encumbrance of the assets transferred or assigned to the Trust Fund (except
pursuant to the provisions of this Agreement) or (d) cause such REMIC to be
subject to a tax on prohibited transactions or prohibited contributions pursuant
to the REMIC Provisions.
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Section 9.03 Indemnification with Respect to Certain Taxes and Loss of
REMIC Status.
In the event that any REMIC formed hereunder fails to qualify as a REMIC,
loses its status as a REMIC, or incurs federal, state or local taxes as a result
of a prohibited transaction or prohibited contribution under the REMIC
Provisions due to the negligent performance by the Servicer of its duties and
obligations set forth herein, the Servicer shall indemnify the Holder of the
related Residual Certificate against any and all losses, claims, damages,
liabilities or expenses ("Losses") resulting from such negligence; provided,
however, that the Servicer shall not be liable for any such Losses attributable
to the action or inaction of the Trustee, the Depositor or the Holder of such
Residual Certificate, as applicable, nor for any such Losses resulting from
misinformation provided by the Holder of such Residual Certificate on which the
Servicer has relied. The foregoing shall not be deemed to limit or restrict the
rights and remedies of the Holder of such Residual Certificate now or hereafter
existing at law or in equity. Notwithstanding the foregoing, however, in no
event shall the Servicer have any liability (1) for any action or omission that
is taken in accordance with and in compliance with the express terms of, or
which is expressly permitted by the terms of, this Agreement, (2) for any Losses
other than arising out of a negligent performance by the Servicer of its duties
and obligations set forth herein, and (3) for any special or consequential
damages to Certificateholders (in addition to payment of principal and interest
on the Certificates).
Section 9.04 REO Property.
(a) Subject to compliance with applicable laws and regulations as
shall at any time be in force, and notwithstanding any other provision of this
Agreement, the Servicer, acting on behalf of the Trust hereunder, shall not
rent, lease, or otherwise earn income on behalf of any REMIC constituting part
of the Trust Fund with respect to any REO Property which might 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 REMIC
constituting part of the Trust Fund of any "income from non-permitted assets"
within the meaning of section 860F(a)(2) of the Code or any "net income from
foreclosure property" which is subject to tax under the REMIC Provisions unless
the Servicer has advised, or has caused the applicable Servicer to advise, the
Trustee in writing to the effect that, under the REMIC Provisions, such action
would not adversely affect the status of any REMIC constituting part of the
Trust Fund as a REMIC and any income generated for such REMIC by the REO
Property would not result in the imposition of a tax upon such REMIC.
(b) The Servicer shall make reasonable efforts to sell any REO
Property for its fair market value. In any event, however, the Servicer shall
dispose of any REO Property before the close of the third calendar year
beginning after the year of its acquisition by the Trust Fund unless the
Servicer has received a grant of extension from the Internal Revenue Service to
the effect that, under the REMIC Provisions and any relevant proposed
legislation and under applicable state law, any REMIC constituting part of the
Trust Fund may hold REO Property for a longer period without adversely affecting
its REMIC status or causing the imposition of a Federal or state tax upon any
REMIC. If the Servicer has received such an extension, then the Servicer shall
continue to attempt to sell the REO Property for its fair market value as
determined in good faith by the Servicer for such longer period as such
extension permits (the "Extended Period"). If the Servicer has not received such
an extension and the Servicer is
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unable to sell the REO Property within 33 months after its acquisition by the
Trust Fund or if the Servicer has received such an extension, and the Servicer
is unable to sell the REO Property within the period ending three months before
the close of the Extended Period, the Servicer shall, before the end of the
applicable period, (i) purchase such REO Property at a price equal to the REO
Property's fair market value as determined in good faith by the Servicer or (ii)
auction the REO Property to the highest bidder (which may be the Servicer) in an
auction reasonably designed to produce a fair price prior to the expiration of
the applicable period.
Section 9.05 Grantor Trust Administration.
The parties intend that the portions of the Trust Fund consisting of the
REMIC 9 X/N Interest and the obligation to pay LIBOR Carryover Amounts, shall be
treated as a "grantor trust" under the Code, and the provisions hereof shall be
interpreted consistently with this intention. In furtherance of such intention,
the Trustee shall furnish or cause to be furnished (i) to the Holders of the Cap
Carryover Certificates and (ii) to the Holder of the Class X and Class N
Certificates (if there is a single beneficial owner thereof) or to itself on
behalf of the partnership comprised of the Holders of the Class X and Class N
Certificates (if there are two or more beneficial owners thereof), and shall
file or cause to be filed with the Internal Revenue Service together with Form
1041 or such other form as may be applicable, indicating their allocable shares
of income with respect to the property held by the Grantor Trust, at the time or
times and in the manner required by the Code.
ARTICLE X
TERMINATION
Section 10.01 Termination.
(a) The respective obligations and responsibilities of the Seller,
the Servicer, the Depositor, the Trustee and the Certificate Registrar created
hereby (other than the obligation of the Trustee to make certain payments to
Certificateholders after the final Distribution Date and the obligation of the
Servicer to send certain notices as hereinafter set forth) shall terminate upon
notice to the Trustee upon the earliest of (i) the Distribution Date on which
the Certificate Principal Balance of each Class of Certificates has been reduced
to zero, (ii) the final payment or other liquidation of the last Mortgage Loan
in the Trust Fund, and (iii) the optional purchase by the Servicer of the
Mortgage Loans as described below. Notwithstanding the foregoing, in no event
shall the trust created hereby continue beyond 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.
The Servicer (or an Affiliate) may, at its option, terminate the Mortgage
Loans in the Trust Fund and retire the Certificates on the next succeeding
Distribution Date upon which the current Pool Balance is less than 10% of the
Pool Balance of the Mortgage Loans as of the Cut-off Date by purchasing all of
the outstanding (i) Mortgage Loans in the Trust Fund at a price equal to the sum
of the outstanding Principal Balance of the Mortgage Loans and except to the
extent previously advanced by the Servicer, accrued and unpaid interest thereon
at the weighted average of the Mortgage Interest Rates through the end of the
Collection Period preceding the
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final Distribution Date plus unreimbursed Servicing Advances, Advances and any
unpaid Servicing Fees allocable to such Mortgage Loans plus any costs or damages
incurred by the Trust Fund in connection with any violation by such Mortgage
Loan of any predatory or abusive lending laws and (ii) REO Properties in the
Trust Fund at a price equal to their fair market value as determined in good
faith by the Servicer (the "Termination Price"). Notwithstanding the foregoing,
the Servicer (or an Affiliate) may not exercise its optional purchase right
unless any Reimbursement Amount owed to the Trust pursuant to Section 2.03
hereof has been paid.
In connection with any such purchase pursuant to the preceding paragraph,
the Servicer shall deliver to the Trustee for deposit in the Distribution
Account all amounts then on deposit in the Collection Account (less amounts
permitted to be withdrawn by the Servicer pursuant to Section 3.07), which
deposit shall be deemed to have occurred immediately following such purchase.
Any such purchase shall be accomplished by delivery to the Trustee for
deposit into the Distribution Account as part of Available Funds on the
Determination Date before such Distribution Date of the Termination Price.
(b) Notice of any termination, specifying the Distribution Date
(which shall be a date that would otherwise be a Distribution Date) upon which
the Certificateholders may surrender their Certificates to the Trustee for
payment of the final distribution and cancellation, shall be given promptly by
the Trustee upon the Trustee receiving notice of such date from the Servicer, by
letter to the Certificateholders mailed not earlier than the 15th day of the
month preceding the month of such final distribution and not later than the 15th
day of the month of such final distribution specifying (1) the Distribution Date
upon which final distribution of the Certificates will be made upon presentation
and surrender of such Certificates at the office or agency of the Trustee
therein designated, (2) the amount of any such final distribution and (3) that
the Record Date otherwise applicable to such Distribution Date is not
applicable, distributions being made only upon presentation and surrender of the
Certificates at the office or agency of the Trustee therein specified. Not less
than five (5) Business Days prior to such Determination Date relating to such
Distribution Date, the Trustee shall notify the Seller of the amount of any
unpaid Reimbursement Amount owed to the Trust.
(c) Upon presentation and surrender of the Certificates, the Trustee
shall cause to be distributed to the Holders of the Certificates on the
Distribution Date for such final distribution, in proportion to the Percentage
Interests of their respective Class and to the extent that funds are available
for such purpose, an amount equal to the amount required to be distributed to
such Holders in accordance with the provisions of Sections 4.01 and 4.02 for
such Distribution Date.
(d) In the event that all Certificateholders shall not surrender
their Certificates for final payment and cancellation on or before such final
Distribution Date, the Trustee shall promptly following such date cause all
funds in the Distribution Account not distributed in final distribution to
Certificateholders to be withdrawn therefrom and credited to the remaining
Certificateholders by depositing such funds in a separate escrow account for the
benefit of such Certificateholders, and the Servicer (if the Servicer has
exercised its right to purchase the Mortgage Loans) or the Trustee (in any other
case) shall give a second written notice to the
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remaining Certificateholders, to surrender their Certificates for cancellation
and receive the final distribution with respect thereto. If within nine months
after the second notice all the Certificates shall not have been surrendered for
cancellation, the Class R Certificateholders shall be entitled to all unclaimed
funds and other assets which remain subject hereto and the Trustee upon transfer
of such funds shall be discharged of any responsibility for such funds, and such
Certificateholders shall look to the Class R Certificateholders for payment.
Section 10.02 Additional Termination Requirements.
(a) In the event that the Servicer exercises its purchase option as
provided in Section 10.01, the Trust shall be terminated in accordance with the
following additional requirements, unless the Trustee shall have been furnished
with an Opinion of Counsel to the effect that the failure of the Trust to comply
with the requirements of this Section will not (i) result in the imposition of
taxes on "prohibited transactions" of the Trust as defined in Section 860F of
the Code or (ii) cause any REMIC constituting part of the Trust Fund to fail to
qualify as a REMIC at any time that any Certificates are outstanding:
(i) The Trustee shall designate a date within 90 days prior to
the final Distribution Date as the date of adoption of plans of complete
liquidation of each of the remaining REMICs included in the Trust Fund and shall
specify such date in the final federal income tax return of each REMIC;
(ii) After the date of adoption of such plans of complete
liquidation and at or prior to the final Distribution Date, the Trustee shall
sell all of the assets of the Trust to the Servicer for cash; and
(iii) At the time of the making of the final payment on the
Certificates, the Trustee shall distribute or credit, or cause to be distributed
or credited in the following order of priority (A) (i) to the Holders of each of
the Class AV-1, Class AF-1, Class AF-2, Class AF-3 and Class AF-4 Certificates,
pro rata and (ii) to the Class ▇-▇, ▇▇▇▇▇ ▇-▇, Class M-3 Class B-1, Class B-2,
Class B-3 and Class B-4 Certificates, the related Certificate Principal Balance,
as applicable, plus one month's interest thereon at the applicable Pass-Through
Rate, (B) (i) to the Class R Certificates, the Class R Excess Interest Amount of
any remaining Monthly Excess Interest and (ii) to the Class N and Class X
Certificates in respect of the Class X/N Interest, the amount of any remaining
Monthly Excess Cash Flow Amounts not previously distributed thereon and not
distributed to the Class R Certificates, (C) to the remaining REMIC Regular
Interests the amounts allocable thereto pursuant to Section 4.08 and (D) to the
Class R Certificateholders, all cash on hand in respect of the related REMIC or
REMICs after such payment (other than cash retained to meet claims) and the
Trust shall terminate at such time.
(b) By their acceptance of Certificates, the Holders thereof hereby
agree to appoint the Trustee as their attorney in fact to: (i) designate such
date of adoption of plans of complete liquidation and (ii) to take such other
action in connection therewith as may be reasonably required to carry out such
plans of complete liquidation all in accordance with the terms hereof.
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ARTICLE XI
MISCELLANEOUS PROVISIONS
Section 11.01 Amendment.
This Agreement may be amended from time to time by the Seller, the
Depositor, the Servicer and the Trustee; and without the consent of the
Certificateholders, (i) to cure any ambiguity, (ii) to correct or supplement any
provisions herein which may be defective or inconsistent with any other
provisions herein, (iii) to make any other provisions with respect to matters or
questions arising under this Agreement or the Certificate Insurance Policy,
which shall not be inconsistent with the provisions of this Agreement, provided
that the prior consent of the Certificate Insurer shall be required for any
amendment that affects its rights, duties or obligations or (iv) to comply with
any requirements imposed by the Code; provided, however, that any such action
listed in clause (i) through (iv) above shall not adversely affect in any
respect the interests of any Certificateholder or the Certificate Insurer, as
evidenced by (i) notice in writing to the Depositor, the Servicer and the
Trustee from the Rating Agencies that such action will not result in the
reduction or withdrawal of the rating of any outstanding Class of Certificates
(without regard to the Certificate Insurance Policy) with respect to which it is
a Rating Agency, or (ii) an Opinion of Counsel delivered to the Servicer and the
Trustee.
In addition, this Agreement may be amended from time to time by Seller,
the Depositor, the Servicer and the Trustee, with the consent of the Majority
Certificateholders 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 or waiver shall (x) reduce in any manner the
amount of, or delay the timing of, payments on the Certificates which are
required to be made on any Certificate without the consent of the Holder of such
Certificate, (y) adversely affect in any material respect the interests of the
Holders of any Class of Certificates or the Certificate Insurer in a manner
other than as described in clause (x) above, without the consent of the Holders
of Certificates of such Class evidencing at least a 66 2/3% Percentage Interest
in such Class or the Certificate Insurer, as the case may be, or (z) reduce the
percentage of Voting Rights required by clause (y) above without the consent of
the Holders of all Certificates of such Class then outstanding. Upon approval of
an amendment, a copy of such amendment shall be sent to the Rating Agencies.
Prior to the execution of any amendment to this Agreement, the Trustee shall be
entitled to receive and rely upon an Opinion of Counsel (at the expense of the
Person seeking such amendment) stating that the execution of such amendment is
authorized or permitted by this Agreement. The Trustee may, but shall not be
obligated to, enter into any such amendment which affects the Trustee's own
rights, duties or immunities under this Agreement.
Notwithstanding any provision of this Agreement to the contrary, the
Trustee shall not consent to any amendment to this Agreement unless it shall
have first received an Opinion of Counsel, delivered by (and at the expense of)
the Person seeking such Amendment, to the effect that such amendment will not
result in the imposition of a tax on any REMIC constituting part of the Trust
Fund pursuant to the REMIC Provisions or cause any REMIC constituting part of
the Trust to fail to qualify as a REMIC at any time that any Certificates are
outstanding and that the amendment is being made in accordance with the terms
hereof.
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Promptly after the execution of any such amendment the Trustee shall
furnish, at the expense of the Person that requested the amendment if such
Person is the Seller or the Servicer (but in no event at the expense of the
Trustee), otherwise at the expense of the Trust, a copy of such amendment and
the Opinion of Counsel referred to in the immediately preceding paragraph to the
Servicer and each Rating Agency.
It shall not be necessary for the consent of Certificateholders under this
Section 11.01 to approve the particular form of any proposed amendment; instead
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.
Section 11.02 Recordation of Agreement; Counterparts.
To the extent permitted by applicable law, this Agreement is subject to
recordation in all appropriate public offices for real property records in all
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
Servicer at the expense of the Trust, but only upon direction of
Certificateholders, 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 together constitute but
one and the same instrument.
Section 11.03 Limitation on Rights of Certificateholders.
The death or incapacity of any Certificateholder shall not (i) operate to
terminate this Agreement or the Trust, (ii) 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, or (iii)
otherwise affect the rights, obligations and liabilities of the parties hereto
or any of them.
Except as expressly provided for herein, no Certificateholder shall have
any right to vote or in any manner otherwise control the operation and
management of the Trust, or the obligations of the parties hereto, nor shall
anything herein set forth or contained in the terms of the Certificates be
construed so as to constitute the Certificateholders from time to time as
partners or members of an association; nor shall any Certificateholder be under
any liability to any third person by reason of any action taken by the parties
to this Agreement pursuant to any provision hereof.
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 herein provided, and unless also the Holders of
Certificates entitled to at least 25% of the Voting Rights shall have made
written request upon
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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 whatever 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, which priority or preference is not otherwise provided
for herein, 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 11.03 each and every Certificateholder and the Trustee shall be entitled
to such relief as can be given either at law or in equity.
Section 11.04 Governing Law; Jurisdiction.
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. With respect to any claim
arising out of this Agreement, each party irrevocably submits to the exclusive
jurisdiction of the courts of the State of New York and the United States
District Court located in the Borough of Manhattan in The City of New York, and
each party irrevocably waives any objection which it may have at any time to the
laying of venue of any suit, action or proceeding arising out of or relating
hereto brought in any such courts, irrevocably waives any claim that any such
suit, action or proceeding brought in any such court has been brought in any
inconvenient forum and further irrevocably waives the right to object, with
respect to such claim, suit, action or proceeding brought in any such court,
that such court does not have jurisdiction over such party, provided that
service of process has been made by any lawful means.
Section 11.05 Notices.
All directions, demands and notices hereunder 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 (a) in the case
of the Seller, Credit-Based Asset Servicing and Securitization LLC, ▇▇▇ ▇▇▇▇▇▇▇
▇▇▇▇▇▇, ▇▇▇▇ ▇▇▇▇▇, ▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇, Attention: Director - Mortgage
Finance (telecopy number (▇▇▇) ▇▇▇-▇▇▇▇), or such other address or telecopy
number as may hereafter be furnished to the Depositor and the Trustee in writing
by the Seller, (b) in the case of the Trustee, U.S. Bank National Association,
▇▇ ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇-▇▇-▇▇▇▇, ▇▇. ▇▇▇▇, ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇-▇▇▇▇, Attention:
Structured Finance, C-BASS 2004-CB6, or such other address as may hereafter be
furnished to the Depositor, the Seller and the Servicer in writing by the
Trustee, (c) in the case of the Depositor, ▇▇▇▇▇▇▇ ▇▇▇▇▇ Mortgage Investors,
Inc., ▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇, 4 World Financial ▇▇▇▇▇▇, ▇▇▇▇ ▇▇▇▇▇, ▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇
▇▇▇▇▇, Attention: Asset-Backed Finance, or such other address as may be
furnished to the Seller, the Servicer and the Trustee in writing by the
Depositor, and (d) in the case of the Servicer, ▇▇▇▇▇▇ Loan Servicing LP, ▇▇▇▇
▇▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇, ▇▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇▇, Attention: ▇▇▇▇▇▇ ▇▇▇▇▇▇▇, or such
other address as may be furnished to the Seller, the Depositor and the
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Trustee in writing by the Servicer. Any notice required or permitted to be
mailed to a Certificateholder shall be given by first class mail, postage
prepaid, at the address of such Holder as shown in the Certificate Register.
Notice of any Servicer Event of Termination shall be given by telecopy and by
certified mail. Any notice so mailed within the time prescribed in this
Agreement shall be conclusively presumed to have duly been given when mailed,
whether or not the Certificateholder receives such notice. A copy of any notice
required to be telecopied hereunder shall also be mailed to the appropriate
party in the manner set forth above.
Section 11.06 Severability of Provisions.
If any one or more of the covenants, agreements, provisions or terms of
this Agreement shall for any reason whatsoever be held invalid, then such
covenants, agreements, provisions or terms shall be deemed severable from the
remaining covenants, agreements, provisions or terms of this Agreement and shall
in no way affect the validity or enforceability of the other provisions of this
Agreement or of the Certificates or the rights of the Holders thereof.
Section 11.07 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 11.08 Notice to the Rating Agencies.
(a) Each of the Trustee and the Servicer shall be obligated to use
its best reasonable efforts promptly to provide notice to the Rating Agencies
with respect to each of the following of which a Responsible Officer of the
Trustee or the Servicer, as the case may be, has actual knowledge:
(i) any material change or amendment to this Agreement;
(ii) the occurrence of any Servicer Event of Termination that
has not been cured or waived;
(iii) the resignation or termination of the Servicer or the
Trustee;
(iv) the final payment to Holders of the Certificates of any
Class;
(v) any change in the location of any Account; and
(vi) if the Trustee is acting as successor Servicer pursuant
to Section 7.02 hereof, any event that would result in the inability of the
Trustee to make Advances.
(vii) In addition, the Servicer shall promptly furnish to each
Rating Agency copies of the following:
(A) each annual statement as to compliance
described in Section 3.19 hereof;
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(B) each annual independent public accountants'
servicing report described in Section 3.20 hereof; and
(C) each notice delivered pursuant to Section
7.01(a) hereof which relates to the fact that the Servicer has not made an
Advance.
Any such notice pursuant to this Section 11.08 shall be in writing and
shall be deemed to have been duly given if personally delivered or mailed by
first class mail, postage prepaid, or by express delivery service to ▇▇▇▇▇'▇
Investors Service, Inc., ▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇, Attention:
Managing Director, Residential Mortgage-Backed Securities; Fitch Ratings, ▇▇▇
▇▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇, ▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇, Attention: Managing Director,
Residential Mortgage-Backed Securities; Standard & Poor's, a division of The
▇▇▇▇▇▇-▇▇▇▇ Companies, Inc., ▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇,
Attention: Mortgage Surveillance Group; and Dominion Bond Rating Service, ▇▇
▇▇▇▇▇▇▇▇, ▇▇▇▇ ▇▇▇▇▇, ▇▇▇ ▇▇▇▇, ▇▇ ▇▇▇▇▇.
Section 11.09 Further Assurances.
Notwithstanding any other provision of this Agreement, neither the Regular
Certificateholders, nor the Trustee shall have any obligation to consent to any
amendment or modification of this Agreement unless they have been provided
reasonable security or indemnity against their out-of-pocket expenses (including
reasonable attorneys' fees) to be incurred in connection therewith.
Section 11.10 Section 11.10 Benefits of Agreement.
Nothing in this Agreement or in the Certificates, expressed or implied,
shall give to any Person, other than the Certificateholders and the parties
hereto and their successors hereunder, any benefit or any legal or equitable
right, remedy or claim under this Agreement. The Certificate Insurer is an
intended third party beneficiary of this Agreement.
Section 11.11 Acts of Certificateholders.
(a) Any request, demand, authorization, direction, notice, consent,
waiver or other action provided by this Agreement to be given or taken by the
Certificateholders may be embodied in and evidenced by one or more instruments
of substantially similar tenor signed by such Certificateholders in person or by
agent duly appointed in writing; and such action shall become effective when
such instrument or instruments are delivered to the Trustee, the Seller and the
Servicer. Such instrument or instruments (and the action embodied therein and
evidenced thereby) are herein sometimes referred to as the "act" of the
Certificateholders signing such instrument or instruments. Proof of execution of
any such instrument or of a writing appointing any such agent shall be
sufficient for any purpose of this Agreement and conclusive in favor of the
Trustee and the Trust, if made in the manner provided in this Section 11.11.
(b) The fact and date of the execution by any Person of any such
instrument or writing may be proved by the affidavit of a witness of such
execution or by the certificate of a notary public or other officer authorized
by law to take acknowledgments of deeds, certifying that the individual signing
such instrument or writing acknowledged to him the execution
146
thereof. Whenever such execution is by a signer acting in a capacity other than
his or her individual capacity, such certificate or affidavit shall also
constitute sufficient proof of his authority.
(c) Any request, demand, authorization, direction, notice, consent,
waiver or other action by any Certificateholder shall bind every future Holder
of such Certificate and the Holder of every Certificate issued upon the
registration of transfer thereof or in exchange therefor or in lieu thereof, in
respect of anything done, omitted or suffered to be done by the Trustee or the
Trust in reliance thereon, whether or not notation of such action is made upon
such Certificate.
[SIGNATURE PAGES IMMEDIATELY FOLLOW]
147
IN WITNESS WHEREOF, the Seller, the Depositor, the Servicer and the
Trustee have caused their names to be signed hereto by their respective officers
thereunto duly authorized, all as of the day and year first above written.
▇▇▇▇▇▇▇ ▇▇▇▇▇ MORTGAGE INVESTORS, INC.,
as Depositor
By: ___________________________________
Name: ▇▇▇▇▇▇▇ ▇▇▇▇▇▇
Title: President
CREDIT-BASED ASSET SERVICING AND
SECURITIZATION LLC, as Seller
By: ___________________________________
Name: ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇
Title: Vice President
▇▇▇▇▇▇ LOAN SERVICING LP, as Servicer
By: ___________________________________
Name: ▇▇▇▇▇▇ ▇▇▇▇▇▇▇
Title: Senior Vice President
U.S. BANK NATIONAL ASSOCIATION, not in
its individual
capacity but solely as Trustee
for the 2004-CB6 Trust, C-BASS
Mortgage Loan Asset-Backed
Certificates, Series 2004-CB6
By: ___________________________________
Name:
Title:
EXHIBIT A-1
FORM OF THE CLASS AV-1 CERTIFICATE
UNLESS THIS CERTIFICATE IS PRESENTED BY AN AUTHORIZED REPRESENTATIVE OF
THE DEPOSITORY TRUST COMPANY, A NEW YORK CORPORATION ("DTC"), TO THE
TRUSTEE OR ITS AGENT FOR REGISTRATION OF TRANSFER, EXCHANGE, OR PAYMENT,
AND ANY CERTIFICATE ISSUED IS REGISTERED IN THE NAME OF CEDE & CO. OR IN
SUCH OTHER NAME AS IS REQUESTED BY AN AUTHORIZED REPRESENTATIVE OF DTC
(AND ANY PAYMENT IS MADE TO CEDE & CO. OR TO SUCH OTHER ENTITY AS IS
REQUESTED BY AN AUTHORIZED REPRESENTATIVE OF DTC), ANY TRANSFER, PLEDGE,
OR OTHER USE HEREOF FOR VALUE OR OTHERWISE BY OR TO ANY PERSON IS WRONGFUL
INASMUCH AS THE REGISTERED OWNER HEREOF, CEDE & CO., HAS AN INTEREST
HEREIN.
FOR U.S. FEDERAL INCOME TAX PURPOSES, THIS CERTIFICATE REPRESENTS
BENEFICIAL OWNERSHIP OF A "REGULAR INTEREST" IN A "REAL ESTATE MORTGAGE
INVESTMENT CONDUIT," AS THOSE TERMS ARE DEFINED, RESPECTIVELY, IN SECTIONS
860G AND 860D OF THE INTERNAL REVENUE CODE OF 1986, AS AMENDED (THE
"CODE") AND CERTAIN OTHER PROPERTY.
C-BASS MORTGAGE LOAN ASSET-BACKED CERTIFICATES
SERIES 2004-CB6, CLASS AV-1
evidencing a beneficial ownership interest in a portion of a Trust Fund
consisting primarily of a pool of conventional fixed-rate and adjustable-rate
one- to four-family first and second lien mortgage loans formed and sold by
▇▇▇▇▇▇▇ ▇▇▇▇▇ MORTGAGE INVESTORS, INC.
Series 2004-CB6, Class AV-1 Original Class Certificate
Principal Balance of the Class AV-1
Certificates as of the Closing
Date: $234,945,000.00
Pass-Through Rate: Variable(1)
Date of Pooling and Servicing Agreement and Initial Certificate Principal
Cut-off Date: August 1, 2004 Balance: $234,945,000.00
First Distribution Date: September 27, 2004 Servicer: ▇▇▇▇▇▇ Loan Servicing LP
-------------
(1) Subject to a cap as described in the Agreement.
A-1-1
No. Trustee: U.S. Bank National Association
CUSIP: 59020U HX 6 Closing Date: September 9, 2004
ISIN: US59020UHX63
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.
THIS CERTIFICATE DOES NOT REPRESENT AN OBLIGATION OF OR INTEREST IN
▇▇▇▇▇▇▇ ▇▇▇▇▇ MORTGAGE INVESTORS, INC., THE SERVICER, THE TRUSTEE OR ANY
OF THEIR AFFILIATES. THIS CERTIFICATE IS NOT GUARANTEED BY ANY AGENCY OR
INSTRUMENTALITY OF THE UNITED STATES.
This certifies that CEDE & CO. is the registered owner of a Percentage
Interest (obtained by dividing the Initial Certificate Principal Balance of this
Certificate by the Original Class Certificate Principal Balance of the Class
AV-1 Certificates) in that certain beneficial ownership interest evidenced by
all the Class AV-1 Certificates in the Trust Fund created pursuant to a Pooling
and Servicing Agreement, dated as specified above (the "Agreement"), among
▇▇▇▇▇▇▇ ▇▇▇▇▇ Mortgage Investors, Inc. (hereinafter called the "Depositor,"
which term includes any successor entity under the Agreement), Credit-Based
Asset Servicing and Securitization LLC (the "Seller"), the Servicer and 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 Business Day immediately preceding such Distribution Date
(the "Record Date"), from funds in the Distribution Account 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 AV-1 Certificates on
such Distribution Date pursuant to the Agreement provided, however, that if any
Class AV-1 Certificate becomes a Definitive Certificate, the Record Date for
such Certificate will be the last Business Day of the month immediately
preceding the month in which the related Distribution Date occurs.
All distributions to the Holder of this Certificate under the Agreement
will be made or caused to be made by or on behalf of the Trustee by wire
transfer in immediately available funds to the account of the Person entitled
thereto if such Person shall have so notified the Certificate Registrar 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 AV-1 Certificates
the aggregate Initial Certificate Principal Balance of which is in excess of
$5,000,000, or 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, provided that the Certificate Registrar may deduct a
A-1-2
reasonable wire transfer fee from any payment made by wire transfer.
Notwithstanding the above, the final distribution on this Certificate will be
made after due notice by the Trustee of the pendency of such distribution and
only upon presentation and surrender of this Certificate at the office or agency
appointed by the Trustee for that purpose as provided in the Agreement.
The Class AV-1 Pass-Through Rate on each Distribution Date will be a rate
per annum equal to the least of (i) LIBOR as of the related LIBOR Determination
Date, plus the Class AV-1 Certificate Margin, (ii) the Group I Available Funds
Cap and (iii) the Group I Maximum Rate Cap.
This Certificate is one of a duly authorized issue of Certificates
designated as C-BASS Mortgage Loan Asset-Backed Certificates of the Series
specified on the face hereof (herein called the "Certificates") and representing
a Percentage Interest in the Class AV-1 Certificates.
The Class AV-1 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 Servicer, the Trustee, the Seller and the rights of the
Certificateholders under the Agreement at any time by the Depositor, the
Servicer, the Seller and the Trustee with the consent of the Holders of
Certificates entitled to the Voting Rights identified in the Agreement. Any such
consent by the Holder of this Certificate shall be conclusive and binding on
such Holder and upon all future Holders of this Certificate and of any
Certificate issued upon the transfer hereof or in exchange 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 Trustee 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 Trustee and the Certificate
Registrar 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 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.
A-1-3
No service charge will be made for any such registration of transfer or
exchange of Certificates, but the Certificate Registrar 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 Servicer, the Trustee, any Paying Agent and the
Certificate Registrar and any agent of the Depositor, the Servicer, the Trustee,
any Paying Agent or the Certificate Registrar may treat the Person in whose name
this Certificate is registered as the owner hereof for all purposes, and none of
the Depositor, the Servicer, the Trustee, the Certificate Registrar, any Paying
Agent 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 or on behalf of the Trustee 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 the Trust Fund, and (ii) the purchase by the party designated in
the Agreement at a price determined as provided in the Agreement from the Trust
Fund of all 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 the Trust Fund all 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
Principal Balance of the Mortgage Loans at the time of purchase being 10% or
less of the Cut-off Date Aggregate Principal Balance.
The recitals contained herein shall be taken as statements of the
Depositor and the Trustee assumes no responsibility for their correctness.
Unless the certificate of authentication hereon has been executed by the
Certificate Registrar, by manual signature, this Certificate shall not be
entitled to any benefit under the Agreement or be valid for any purpose.
A-1-4
IN WITNESS WHEREOF, the Trustee has caused this Certificate to be duly
executed.
Dated: September 9, 2004
U.S. BANK NATIONAL ASSOCIATION,
as Trustee
By: _______________________________
Authorized Officer
CERTIFICATE OF AUTHENTICATION
This is one of the Certificates referred to in the within-mentioned
Agreement.
U.S. BANK NATIONAL ASSOCIATION,
as Certificate Registrar
By: _______________________________
Authorized Signatory
Date of authentication: September 9, 2004
A-1-5
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)
TEN ENT - as tenants by the entireties under Uniform
Gifts to Minors
JT TEN - as joint tenants with right of Act
survivorship and not as tenants
in common
________________
(State)
Additional abbreviations may also be used though not in the above list.
A-1-6
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
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 Certificate Registrar 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 _______________________________________________,
the assignee named above, or _______________________________________________, as
its agent.
▇-▇-▇
▇▇▇▇▇▇▇ ▇-▇
FORM OF THE CLASS AF-1 CERTIFICATE
UNLESS THIS CERTIFICATE IS PRESENTED BY AN AUTHORIZED REPRESENTATIVE OF
THE DEPOSITORY TRUST COMPANY, A NEW YORK CORPORATION ("DTC"), TO THE
TRUSTEE OR ITS AGENT FOR REGISTRATION OF TRANSFER, EXCHANGE, OR PAYMENT,
AND ANY CERTIFICATE ISSUED IS REGISTERED IN THE NAME OF CEDE & CO. OR IN
SUCH OTHER NAME AS IS REQUESTED BY AN AUTHORIZED REPRESENTATIVE OF DTC
(AND ANY PAYMENT IS MADE TO CEDE & CO. OR TO SUCH OTHER ENTITY AS IS
REQUESTED BY AN AUTHORIZED REPRESENTATIVE OF DTC), ANY TRANSFER, PLEDGE,
OR OTHER USE HEREOF FOR VALUE OR OTHERWISE BY OR TO ANY PERSON IS WRONGFUL
INASMUCH AS THE REGISTERED OWNER HEREOF, CEDE & CO., HAS AN INTEREST
HEREIN.
FOR U.S. FEDERAL INCOME TAX PURPOSES, THIS CERTIFICATE REPRESENTS
BENEFICIAL OWNERSHIP OF A "REGULAR INTEREST" IN A "REAL ESTATE MORTGAGE
INVESTMENT CONDUIT," AS THOSE TERMS ARE DEFINED, RESPECTIVELY, IN SECTIONS
860G AND 860D OF THE INTERNAL REVENUE CODE OF 1986, AS AMENDED (THE
"CODE").
C-BASS MORTGAGE LOAN ASSET-BACKED CERTIFICATES
SERIES 2004-CB6, CLASS AF-1
evidencing a beneficial ownership interest in a portion of a Trust Fund
consisting primarily of a pool of conventional fixed-rate and adjustable-rate
one- to four-family first and second lien mortgage loans formed and sold by
▇▇▇▇▇▇▇ ▇▇▇▇▇ MORTGAGE INVESTORS, INC.
Series 2004-CB6, Class AF-1 Original Class Certificate
Principal Balance of the Class
AF-1 Certificates as of the
Closing Date: $70,132,000.00
Pass-Through Rate: Variable(1)
Date of Pooling and Servicing Agreement and Initial Certificate Principal
Cut-off Date: August 1, 2004 Balance: $70,132,000.00
First Distribution Date: September 27, 2004 Servicer: ▇▇▇▇▇▇ Loan Servicing LP
No. Trustee: U.S. Bank National
Association
--------
(1) Subject to a cap as described in the Agreement.
A-2-1
CUSIP: 59020U HY 4 Closing Date: September 9, 2004
ISIN: US59020UHY47
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.
THIS CERTIFICATE DOES NOT REPRESENT AN OBLIGATION OF OR INTEREST IN
▇▇▇▇▇▇▇ ▇▇▇▇▇ MORTGAGE INVESTORS, INC., THE SERVICER, THE TRUSTEE OR ANY
OF THEIR AFFILIATES. THIS CERTIFICATE IS NOT GUARANTEED BY ANY AGENCY OR
INSTRUMENTALITY OF THE UNITED STATES.
This certifies that CEDE & CO. is the registered owner of a Percentage
Interest (obtained by dividing the Initial Certificate Principal Balance of this
Certificate by the Original Class Certificate Principal Balance of the Class
AF-1 Certificates) in that certain beneficial ownership interest evidenced by
all the Class AF-1 Certificates in the Trust Fund created pursuant to a Pooling
and Servicing Agreement, dated as specified above (the "Agreement"), among
▇▇▇▇▇▇▇ ▇▇▇▇▇ Mortgage Investors, Inc. (hereinafter called the "Depositor,"
which term includes any successor entity under the Agreement), Credit-Based
Asset Servicing and Securitization LLC (the "Seller"), the Servicer and 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 Business Day immediately preceding such Distribution Date
(the "Record Date"), from funds in the Distribution Account 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 AF-1 Certificates on
such Distribution Date pursuant to the Agreement provided, however, that if any
Class AF-1 Certificate becomes a Definitive Certificate, the Record Date for
such Certificate will be the last Business Day of the month immediately
preceding the month in which the related Distribution Date occurs.
All distributions to the Holder of this Certificate under the Agreement
will be made or caused to be made by or on behalf of the Trustee by wire
transfer in immediately available funds to the account of the Person entitled
thereto if such Person shall have so notified the Certificate Registrar 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 AF-1 Certificates
the aggregate Initial Certificate Principal Balance of which is in excess of
$5,000,000, or 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, provided that the Certificate Registrar may deduct a reasonable wire
transfer fee from any payment made by wire transfer. Notwithstanding the
A-2-2
above, the final distribution on this Certificate will be made after due notice
by the Trustee of the pendency of such distribution and only upon presentation
and surrender of this Certificate at the office or agency appointed by the
Trustee for that purpose as provided in the Agreement.
The Class AF-1 Pass-Through Rate on each Distribution Date will the per
annum rate specified above, subject to increase as provided in the Agreement.
Interest will accrue on the Class AF-1 Certificates during each Interest Accrual
Period at a rate equal to the lesser of (i) LIBOR as of the related LIBOR
Determination Date, plus the Class AF-1 Certificate Margin and (ii) the Group II
Net Rate Cap for such Distribution Date.
This Certificate is one of a duly authorized issue of Certificates
designated as C-BASS Mortgage Loan Asset-Backed Certificates of the Series
specified on the face hereof (herein called the "Certificates") and representing
a Percentage Interest in the Class AF-1 Certificates.
The Class AF-1 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 Servicer, the Trustee, the Seller and the rights of the
Certificateholders under the Agreement at any time by the Depositor, the
Servicer, the Seller and the Trustee with the consent of the Holders of
Certificates entitled to the Voting Rights identified in the Agreement. Any such
consent by the Holder of this Certificate shall be conclusive and binding on
such Holder and upon all future Holders of this Certificate and of any
Certificate issued upon the transfer hereof or in exchange 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 Trustee 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 Trustee and the Certificate
Registrar 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 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.
A-2-3
No service charge will be made for any such registration of transfer or
exchange of Certificates, but the Certificate Registrar 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 Servicer, the Trustee, any Paying Agent and the
Certificate Registrar and any agent of the Depositor, the Servicer, the Trustee,
any Paying Agent or the Certificate Registrar may treat the Person in whose name
this Certificate is registered as the owner hereof for all purposes, and none of
the Depositor, the Servicer, the Trustee, the Certificate Registrar, any Paying
Agent 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 or on behalf of the Trustee 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 the Trust Fund, and (ii) the purchase by the party designated in
the Agreement at a price determined as provided in the Agreement from the Trust
Fund of all 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 the Trust Fund all 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
Principal Balance of the Mortgage Loans at the time of purchase being 10% or
less of the Cut-off Date Aggregate Principal Balance.
The recitals contained herein shall be taken as statements of the
Depositor and the Trustee assumes no responsibility for their correctness.
Unless the certificate of authentication hereon has been executed by the
Certificate Registrar, by manual signature, this Certificate shall not be
entitled to any benefit under the Agreement or be valid for any purpose.
A-2-4
IN WITNESS WHEREOF, the Trustee has caused this Certificate to be duly
executed.
Dated: September 9, 2004
U.S. BANK NATIONAL ASSOCIATION,
as Trustee
By: ______________________________
Authorized Officer
CERTIFICATE OF AUTHENTICATION
This is one of the Certificates referred to in the within-mentioned
Agreement.
U.S. BANK NATIONAL ASSOCIATION,
as Certificate Registrar
By: ______________________________
Authorized Signatory
Date of authentication: September 9, 2004
A-2-5
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)
TEN ENT - as tenants by the entireties under Uniform
Gifts to Minors
JT TEN - as joint tenants with right of Act
survivorship and not as tenants in
common
_______________
(State)
Additional abbreviations may also be used though not in the above list.
A-2-6
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
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 Certificate Registrar 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 _______________________________________________,
the assignee named above, or _______________________________________________, as
its agent.
▇-▇-▇
▇▇▇▇▇▇▇ ▇-▇
FORM OF CLASS A-F2 CERTIFICATE
UNLESS THIS CERTIFICATE IS PRESENTED BY AN AUTHORIZED REPRESENTATIVE OF
THE DEPOSITORY TRUST COMPANY, A NEW YORK CORPORATION ("DTC"), TO THE
TRUSTEE OR ITS AGENT FOR REGISTRATION OF TRANSFER, EXCHANGE, OR PAYMENT,
AND ANY CERTIFICATE ISSUED IS REGISTERED IN THE NAME OF CEDE & CO. OR IN
SUCH OTHER NAME AS IS REQUESTED BY AN AUTHORIZED REPRESENTATIVE OF DTC
(AND ANY PAYMENT IS MADE TO CEDE & CO. OR TO SUCH OTHER ENTITY AS IS
REQUESTED BY AN AUTHORIZED REPRESENTATIVE OF DTC), ANY TRANSFER, PLEDGE,
OR OTHER USE HEREOF FOR VALUE OR OTHERWISE BY OR TO ANY PERSON IS WRONGFUL
INASMUCH AS THE REGISTERED OWNER HEREOF, CEDE & CO., HAS AN INTEREST
HEREIN.
FOR U.S. FEDERAL INCOME TAX PURPOSES, THIS CERTIFICATE REPRESENTS
BENEFICIAL OWNERSHIP OF A "REGULAR INTEREST" IN A "REAL ESTATE MORTGAGE
INVESTMENT CONDUIT," AS THOSE TERMS ARE DEFINED, RESPECTIVELY, IN SECTIONS
860G AND 860D OF THE INTERNAL REVENUE CODE OF 1986, AS AMENDED (THE
"CODE").
C-BASS MORTGAGE LOAN ASSET-BACKED CERTIFICATES
SERIES 2004-CB6, CLASS AF-2
evidencing a beneficial ownership interest in a portion of a Trust Fund
consisting primarily of a pool of conventional fixed-rate and adjustable-rate
one- to four-family first and second lien mortgage loans formed and sold by
▇▇▇▇▇▇▇ ▇▇▇▇▇ MORTGAGE INVESTORS, INC.
Series 2004-CB6, Class AF-2 Original Class Certificate
Principal Balance of the Class
AF-2 Certificates as of the
Closing Date: $32,835,000.00
Pass-Through Rate: 4.062%(1)
Date of Pooling and Servicing Agreement and Initial Certificate Principal
Cut-off Date: August 1, 2004 Balance: $32,835,000.00
First Distribution Date: September 27, 2004 Servicer: ▇▇▇▇▇▇ Loan Servicing LP
No. Trustee: U.S. Bank National
Association
--------
(1) Subject to a cap as described in the Agreement.
A-3-1
CUSIP: 59020U HZ 1 Closing Date: September 9, 2004
ISIN: US59020UHZ12
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.
THIS CERTIFICATE DOES NOT REPRESENT AN OBLIGATION OF OR INTEREST IN
▇▇▇▇▇▇▇ ▇▇▇▇▇ MORTGAGE INVESTORS, INC., THE SERVICER, THE TRUSTEE OR ANY
OF THEIR AFFILIATES. THIS CERTIFICATE IS NOT GUARANTEED BY ANY AGENCY OR
INSTRUMENTALITY OF THE UNITED STATES.
This certifies that CEDE & CO. is the registered owner of a Percentage
Interest (obtained by dividing the Initial Certificate Principal Balance of this
Certificate by the Original Class Certificate Principal Balance of the Class
AF-2 Certificates) in that certain beneficial ownership interest evidenced by
all the Class AF-2 Certificates in the Trust Fund created pursuant to a Pooling
and Servicing Agreement, dated as specified above (the "Agreement"), among
▇▇▇▇▇▇▇ ▇▇▇▇▇ Mortgage Investors, Inc. (hereinafter called the "Depositor,"
which term includes any successor entity under the Agreement), Credit-Based
Asset Servicing and Securitization LLC (the "Seller"), the Servicer and 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 Business Day immediately preceding such Distribution Date
(the "Record Date"), from funds in the Distribution Account 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 AF-2 Certificates on
such Distribution Date pursuant to the Agreement provided, however, that if any
Class AF-2 Certificate becomes a Definitive Certificate, the Record Date for
such Certificate will be the last Business Day of the month immediately
preceding the month in which the related Distribution Date occurs.
All distributions to the Holder of this Certificate under the Agreement
will be made or caused to be made by or on behalf of the Trustee by wire
transfer in immediately available funds to the account of the Person entitled
thereto if such Person shall have so notified the Certificate Registrar 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 AF-2 Certificates
the aggregate Initial Certificate Principal Balance of which is in excess of
$5,000,000, or 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, provided that the Certificate Registrar may deduct a
A-3-2
reasonable wire transfer fee from any payment made by wire transfer.
Notwithstanding the above, the final distribution on this Certificate will be
made after due notice by the Trustee of the pendency of such distribution and
only upon presentation and surrender of this Certificate at the office or agency
appointed by the Trustee for that purpose as provided in the Agreement.
The Class AF-2 Pass-Through Rate on each Distribution Date will the per
annum rate specified above, subject to increase as provided in the Agreement.
Interest will accrue on the Class AF-2 Certificates during each Interest Accrual
Period at a rate equal to the lesser of (i) the Class AF-2 Pass-Through Rate and
(ii) the Group II Net Rate Cap for such Distribution Date.
This Certificate is one of a duly authorized issue of Certificates
designated as C-BASS Mortgage Loan Asset-Backed Certificates of the Series
specified on the face hereof (herein called the "Certificates") and representing
a Percentage Interest in the Class AF-2 Certificates.
The Class AF-2 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 Servicer, the Trustee, the Seller and the rights of the
Certificateholders under the Agreement at any time by the Depositor, the
Servicer, the Seller and the Trustee with the consent of the Holders of
Certificates entitled to the Voting Rights identified in the Agreement. Any such
consent by the Holder of this Certificate shall be conclusive and binding on
such Holder and upon all future Holders of this Certificate and of any
Certificate issued upon the transfer hereof or in exchange 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 Trustee 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 Trustee and the Certificate
Registrar 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 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.
A-3-3
No service charge will be made for any such registration of transfer or
exchange of Certificates, but the Certificate Registrar 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 Servicer, the Trustee, any Paying Agent and the
Certificate Registrar and any agent of the Depositor, the Servicer, the Trustee,
any Paying Agent or the Certificate Registrar may treat the Person in whose name
this Certificate is registered as the owner hereof for all purposes, and none of
the Depositor, the Servicer, the Trustee, the Certificate Registrar, any Paying
Agent 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 or on behalf of the Trustee 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 the Trust Fund, and (ii) the purchase by the party designated in
the Agreement at a price determined as provided in the Agreement from the Trust
Fund of all 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 the Trust Fund all 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
Principal Balance of the Mortgage Loans at the time of purchase being 10% or
less of the Cut-off Date Aggregate Principal Balance.
The recitals contained herein shall be taken as statements of the
Depositor and the Trustee assumes no responsibility for their correctness.
Unless the certificate of authentication hereon has been executed by the
Certificate Registrar, by manual signature, this Certificate shall not be
entitled to any benefit under the Agreement or be valid for any purpose.
A-3-4
IN WITNESS WHEREOF, the Trustee has caused this Certificate to be duly
executed.
Dated: September 9, 2004
U.S. BANK NATIONAL ASSOCIATION,
as Trustee
By: ______________________________
Authorized Officer
CERTIFICATE OF AUTHENTICATION
This is one of the Certificates referred to in the within-mentioned
Agreement.
U.S. BANK NATIONAL ASSOCIATION,
as Certificate Registrar
By: ______________________________
Authorized Signatory
Date of authentication: September 9, 2004
A-3-5
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)
TEN ENT - as tenants by the entireties under Uniform
Gifts to Minors
JT TEN - as joint tenants with right of Act
survivorship and not as tenants in
common
________________
(State)
Additional abbreviations may also be used though not in the above list.
A-3-6
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
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 Certificate Registrar 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 _______________________________________________,
the assignee named above, or _______________________________________________, as
its agent.
▇-▇-▇
▇▇▇▇▇▇▇ ▇-▇
FORM OF CLASS AF-3 CERTIFICATE
UNLESS THIS CERTIFICATE IS PRESENTED BY AN AUTHORIZED REPRESENTATIVE OF
THE DEPOSITORY TRUST COMPANY, A NEW YORK CORPORATION ("DTC"), TO THE
TRUSTEE OR ITS AGENT FOR REGISTRATION OF TRANSFER, EXCHANGE, OR PAYMENT,
AND ANY CERTIFICATE ISSUED IS REGISTERED IN THE NAME OF CEDE & CO. OR IN
SUCH OTHER NAME AS IS REQUESTED BY AN AUTHORIZED REPRESENTATIVE OF DTC
(AND ANY PAYMENT IS MADE TO CEDE & CO. OR TO SUCH OTHER ENTITY AS IS
REQUESTED BY AN AUTHORIZED REPRESENTATIVE OF DTC), ANY TRANSFER, PLEDGE,
OR OTHER USE HEREOF FOR VALUE OR OTHERWISE BY OR TO ANY PERSON IS WRONGFUL
INASMUCH AS THE REGISTERED OWNER HEREOF, CEDE & CO., HAS AN INTEREST
HEREIN.
FOR U.S. FEDERAL INCOME TAX PURPOSES, THIS CERTIFICATE REPRESENTS
BENEFICIAL OWNERSHIP OF A "REGULAR INTEREST" IN A "REAL ESTATE MORTGAGE
INVESTMENT CONDUIT," AS THOSE TERMS ARE DEFINED, RESPECTIVELY, IN SECTIONS
860G AND 860D OF THE INTERNAL REVENUE CODE OF 1986, AS AMENDED (THE
"CODE").
C-BASS MORTGAGE LOAN ASSET-BACKED CERTIFICATES
SERIES 2004-CB6, CLASS AF-3
evidencing a beneficial ownership interest in a portion of a Trust Fund
consisting primarily of a pool of conventional fixed-rate and adjustable-rate
one- to four-family first and second lien mortgage loans formed and sold by
▇▇▇▇▇▇▇ ▇▇▇▇▇ MORTGAGE INVESTORS, INC.
Series 2004-CB6, Class AF-3 Original Class Certificate Principal Balance of the
Class AF-3 Certificates as of the Closing
Date: $23,089,000.00
Pass-Through Rate: 5.135%(1)
Date of Pooling and Servicing Agreement and Initial Certificate Principal Balance: $23,089,000.00
Cut-off Date: August 1, 2004
First Distribution Date: September 27, 2004 Servicer: ▇▇▇▇▇▇ Loan Servicing LP
No. Trustee: U.S. Bank National Association
----------
(1) Subject to a cap as described in the Agreement.
A-4-1
CUSIP: 59020U JA 4 Closing Date: September 9, 2004
ISIN: US59020UJA43
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.
THIS CERTIFICATE DOES NOT REPRESENT AN OBLIGATION OF OR INTEREST IN
▇▇▇▇▇▇▇ ▇▇▇▇▇ MORTGAGE INVESTORS, INC., THE SERVICER, THE TRUSTEE OR ANY
OF THEIR AFFILIATES. THIS CERTIFICATE IS NOT GUARANTEED BY ANY AGENCY OR
INSTRUMENTALITY OF THE UNITED STATES.
This certifies that CEDE & CO. is the registered owner of a Percentage
Interest (obtained by dividing the Initial Certificate Principal Balance of this
Certificate by the Original Class Certificate Principal Balance of the Class
AF-3 Certificates) in that certain beneficial ownership interest evidenced by
all the Class AF-3 Certificates in the Trust Fund created pursuant to a Pooling
and Servicing Agreement, dated as specified above (the "Agreement"), among
▇▇▇▇▇▇▇ ▇▇▇▇▇ Mortgage Investors, Inc. (hereinafter called the "Depositor,"
which term includes any successor entity under the Agreement), Credit-Based
Asset Servicing and Securitization LLC (the "Seller"), the Servicer and 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 Business Day immediately preceding such Distribution Date
(the "Record Date"), from funds in the Distribution Account 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 AF-3 Certificates on
such Distribution Date pursuant to the Agreement provided, however, that if any
Class AF-3 Certificate becomes a Definitive Certificate, the Record Date for
such Certificate will be the last Business Day of the month immediately
preceding the month in which the related Distribution Date occurs.
All distributions to the Holder of this Certificate under the Agreement
will be made or caused to be made by or on behalf of the Trustee by wire
transfer in immediately available funds to the account of the Person entitled
thereto if such Person shall have so notified the Certificate Registrar 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 AF-3 Certificates
the aggregate Initial Certificate Principal Balance of which is in excess of
$5,000,000, or 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, provided that the Certificate Registrar may deduct a
A-4-2
reasonable wire transfer fee from any payment made by wire transfer.
Notwithstanding the above, the final distribution on this Certificate will be
made after due notice by the Trustee of the pendency of such distribution and
only upon presentation and surrender of this Certificate at the office or agency
appointed by the Trustee for that purpose as provided in the Agreement.
The Class AF-3 Pass-Through Rate on each Distribution Date will the per
annum rate specified above, subject to increase as provided in the Agreement.
Interest will accrue on the Class AF-3 Certificates during each Interest Accrual
Period at a rate equal to the lesser of (i) the Class AF-3 Pass-Through Rate and
(ii) the Group II Net Rate Cap for such Distribution Date.
This Certificate is one of a duly authorized issue of Certificates
designated as C-BASS Mortgage Loan Asset-Backed Certificates of the Series
specified on the face hereof (herein called the "Certificates") and representing
a Percentage Interest in the Class AF-3 Certificates.
The Class AF-3 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 Servicer, the Trustee, the Seller and the rights of the
Certificateholders under the Agreement at any time by the Depositor, the
Servicer, the Seller and the Trustee with the consent of the Holders of
Certificates entitled to the Voting Rights identified in the Agreement. Any such
consent by the Holder of this Certificate shall be conclusive and binding on
such Holder and upon all future Holders of this Certificate and of any
Certificate issued upon the transfer hereof or in exchange 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 Trustee 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 Trustee and the Certificate
Registrar 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 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.
A-4-3
No service charge will be made for any such registration of transfer or
exchange of Certificates, but the Certificate Registrar 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 Servicer, the Trustee, any Paying Agent and the
Certificate Registrar and any agent of the Depositor, the Servicer, the Trustee,
any Paying Agent or the Certificate Registrar may treat the Person in whose name
this Certificate is registered as the owner hereof for all purposes, and none of
the Depositor, the Servicer, the Trustee, the Certificate Registrar, any Paying
Agent 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 or on behalf of the Trustee 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 the Trust Fund, and (ii) the purchase by the party designated in
the Agreement at a price determined as provided in the Agreement from the Trust
Fund of all 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 the Trust Fund all 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
Principal Balance of the Mortgage Loans at the time of purchase being 10% or
less of the Cut-off Date Aggregate Principal Balance.
The recitals contained herein shall be taken as statements of the
Depositor and the Trustee assumes no responsibility for their correctness.
Unless the certificate of authentication hereon has been executed by the
Certificate Registrar, by manual signature, this Certificate shall not be
entitled to any benefit under the Agreement or be valid for any purpose.
A-4-4
IN WITNESS WHEREOF, the Trustee has caused this Certificate to be duly
executed.
Dated: September 9, 2004
U.S. BANK NATIONAL ASSOCIATION,
as Trustee
By: __________________________________
Authorized Officer
CERTIFICATE OF AUTHENTICATION
This is one of the Certificates referred to in the within-mentioned Agreement.
U.S. BANK NATIONAL ASSOCIATION,
as Certificate Registrar
By: __________________________________
Authorized Signatory
Date of authentication: September 9, 2004
A-4-5
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)
TEN ENT - as tenants by the entireties under Uniform
Gifts to Minors
JT TEN - as joint tenants with right of Act
survivorship and not as tenants
in common _______________
(State)
Additional abbreviations may also be used though not in the above list.
A-4-6
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
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 Certificate Registrar 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 ___________________________________________________,
the assignee named above, or __________________________________________________,
as its agent.
▇-▇-▇
▇▇▇▇▇▇▇ ▇-▇
FORM OF CLASS AF-4 CERTIFICATE
UNLESS THIS CERTIFICATE IS PRESENTED BY AN AUTHORIZED REPRESENTATIVE OF
THE DEPOSITORY TRUST COMPANY, A NEW YORK CORPORATION ("DTC"), TO THE
TRUSTEE OR ITS AGENT FOR REGISTRATION OF TRANSFER, EXCHANGE, OR PAYMENT,
AND ANY CERTIFICATE ISSUED IS REGISTERED IN THE NAME OF CEDE & CO. OR IN
SUCH OTHER NAME AS IS REQUESTED BY AN AUTHORIZED REPRESENTATIVE OF DTC
(AND ANY PAYMENT IS MADE TO CEDE & CO. OR TO SUCH OTHER ENTITY AS IS
REQUESTED BY AN AUTHORIZED REPRESENTATIVE OF DTC), ANY TRANSFER, PLEDGE,
OR OTHER USE HEREOF FOR VALUE OR OTHERWISE BY OR TO ANY PERSON IS WRONGFUL
INASMUCH AS THE REGISTERED OWNER HEREOF, CEDE & CO., HAS AN INTEREST
HEREIN.
FOR U.S. FEDERAL INCOME TAX PURPOSES, THIS CERTIFICATE REPRESENTS
BENEFICIAL OWNERSHIP OF A "REGULAR INTEREST" IN A "REAL ESTATE MORTGAGE
INVESTMENT CONDUIT," AS THOSE TERMS ARE DEFINED, RESPECTIVELY, IN SECTIONS
860G AND 860D OF THE INTERNAL REVENUE CODE OF 1986, AS AMENDED (THE
"CODE").
C-BASS MORTGAGE LOAN ASSET-BACKED CERTIFICATES
SERIES 2004-CB6, CLASS AF-4
evidencing a beneficial ownership interest in a portion of a Trust Fund
consisting primarily of a pool of conventional fixed-rate and adjustable-rate
one- to four-family first and second lien mortgage loans formed and sold by
▇▇▇▇▇▇▇ ▇▇▇▇▇ MORTGAGE INVESTORS, INC.
Series 2004-CB6, Class AF-4 Original Class Certificate Principal Balance of the
Class AF-4 Certificates as of the Closing
Date: $14,006,000.00
Pass-Through Rate: 4.764%(1)
Date of Pooling and Servicing Agreement and Initial Certificate Principal Balance: $14,006,000.00
Cut-off Date: August 1, 2004
First Distribution Date: September 27, 2004 Servicer: ▇▇▇▇▇▇ Loan Servicing LP
No. Trustee: U.S. Bank National Association
----------
(1) Subject to a cap as described in the Agreement.
A-5-1
CUSIP: 59020U JB 2 Closing Date: September 9, 2004
ISIN: US59020UJB26
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.
THIS CERTIFICATE DOES NOT REPRESENT AN OBLIGATION OF OR INTEREST IN
▇▇▇▇▇▇▇ ▇▇▇▇▇ MORTGAGE INVESTORS, INC., THE SERVICER, THE TRUSTEE OR ANY
OF THEIR AFFILIATES. THIS CERTIFICATE IS NOT GUARANTEED BY ANY AGENCY OR
INSTRUMENTALITY OF THE UNITED STATES.
This certifies that CEDE & CO. is the registered owner of a Percentage
Interest (obtained by dividing the Initial Certificate Principal Balance of this
Certificate by the Original Class Certificate Principal Balance of the Class
AF-4 Certificates) in that certain beneficial ownership interest evidenced by
all the Class AF-4 Certificates in the Trust Fund created pursuant to a Pooling
and Servicing Agreement, dated as specified above (the "Agreement"), among
▇▇▇▇▇▇▇ ▇▇▇▇▇ Mortgage Investors, Inc. (hereinafter called the "Depositor,"
which term includes any successor entity under the Agreement), Credit-Based
Asset Servicing and Securitization LLC (the "Seller"), the Servicer and 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 Business Day immediately preceding such Distribution Date
(the "Record Date"), from funds in the Distribution Account 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 AF-4 Certificates on
such Distribution Date pursuant to the Agreement provided, however, that if any
Class AF-4 Certificate becomes a Definitive Certificate, the Record Date for
such Certificate will be the last Business Day of the month immediately
preceding the month in which the related Distribution Date occurs.
All distributions to the Holder of this Certificate under the Agreement
will be made or caused to be made by or on behalf of the Trustee by wire
transfer in immediately available funds to the account of the Person entitled
thereto if such Person shall have so notified the Certificate Registrar 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 AF-4 Certificates
the aggregate Initial Certificate Principal Balance of which is in excess of
$5,000,000, or 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, provided that the Certificate Registrar may deduct a
A-5-2
reasonable wire transfer fee from any payment made by wire transfer.
Notwithstanding the above, the final distribution on this Certificate will be
made after due notice by the Trustee of the pendency of such distribution and
only upon presentation and surrender of this Certificate at the office or agency
appointed by the Trustee for that purpose as provided in the Agreement.
The Class AF-4 Pass-Through Rate on each Distribution Date will the per
annum rate specified above, subject to increase as provided in the Agreement.
Interest will accrue on the Class AF-4 Certificates during each Interest Accrual
Period at a rate equal to the lesser of (i) the Class AF-4 Pass-Through Rate and
(ii) the Group II Net Rate Cap for such Distribution Date.
This Certificate is one of a duly authorized issue of Certificates
designated as C-BASS Mortgage Loan Asset-Backed Certificates of the Series
specified on the face hereof (herein called the "Certificates") and representing
a Percentage Interest in the Class AF-4 Certificates.
The Class AF-4 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 Servicer, the Trustee, the Seller and the rights of the
Certificateholders under the Agreement at any time by the Depositor, the
Servicer, the Seller and the Trustee with the consent of the Holders of
Certificates entitled to the Voting Rights identified in the Agreement. Any such
consent by the Holder of this Certificate shall be conclusive and binding on
such Holder and upon all future Holders of this Certificate and of any
Certificate issued upon the transfer hereof or in exchange 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 Trustee 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 Trustee and the Certificate
Registrar 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 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.
A-5-3
No service charge will be made for any such registration of transfer or
exchange of Certificates, but the Certificate Registrar 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 Servicer, the Trustee, any Paying Agent and the
Certificate Registrar and any agent of the Depositor, the Servicer, the Trustee,
any Paying Agent or the Certificate Registrar may treat the Person in whose name
this Certificate is registered as the owner hereof for all purposes, and none of
the Depositor, the Servicer, the Trustee, the Certificate Registrar, any Paying
Agent 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 or on behalf of the Trustee 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 the Trust Fund, and (ii) the purchase by the party designated in
the Agreement at a price determined as provided in the Agreement from the Trust
Fund of all 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 the Trust Fund all 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
Principal Balance of the Mortgage Loans at the time of purchase being 10% or
less of the Cut-off Date Aggregate Principal Balance.
The recitals contained herein shall be taken as statements of the
Depositor and the Trustee assumes no responsibility for their correctness.
Unless the certificate of authentication hereon has been executed by the
Certificate Registrar, by manual signature, this Certificate shall not be
entitled to any benefit under the Agreement or be valid for any purpose.
A-5-4
IN WITNESS WHEREOF, the Trustee has caused this Certificate to be duly
executed.
Dated: September 9, 2004
U.S. BANK NATIONAL ASSOCIATION,
as Trustee
By: _________________________________
Authorized Officer
CERTIFICATE OF AUTHENTICATION
This is one of the Certificates referred to in the within-mentioned
Agreement.
U.S. BANK NATIONAL ASSOCIATION,
as Certificate Registrar
By: _________________________________
Authorized Officer
Date of authentication: September 9, 2004
A-5-5
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)
TEN ENT - as tenants by the entireties under Uniform
Gifts to Minors
JT TEN - as joint tenants with right of Act
survivorship and not as tenants
in common _______________
(State)
Additional abbreviations may also be used though not in the above list.
A-5-6
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
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 Certificate Registrar 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 ___________________________________________________,
the assignee named above, or __________________________________________________,
as its agent.
▇-▇-▇
▇▇▇▇▇▇▇ ▇-▇
FORM OF CLASS B-1 CERTIFICATE
UNLESS THIS CERTIFICATE IS PRESENTED BY AN AUTHORIZED REPRESENTATIVE OF
THE DEPOSITORY TRUST COMPANY, A NEW YORK CORPORATION ("DTC"), TO THE
TRUSTEE OR ITS AGENT FOR REGISTRATION OF TRANSFER, EXCHANGE, OR PAYMENT,
AND ANY CERTIFICATE ISSUED IS REGISTERED IN THE NAME OF CEDE & CO. OR IN
SUCH OTHER NAME AS IS REQUESTED BY AN AUTHORIZED REPRESENTATIVE OF DTC
(AND ANY PAYMENT IS MADE TO CEDE & CO. OR TO SUCH OTHER ENTITY AS IS
REQUESTED BY AN AUTHORIZED REPRESENTATIVE OF DTC), ANY TRANSFER, PLEDGE,
OR OTHER USE HEREOF FOR VALUE OR OTHERWISE BY OR TO ANY PERSON IS WRONGFUL
INASMUCH AS THE REGISTERED OWNER HEREOF, CEDE & CO., HAS AN INTEREST
HEREIN.
THIS CERTIFICATE IS SUBORDINATED IN RIGHT OF PAYMENT TO THE CLASS A, CLASS
M-1, CLASS M-2 AND CLASS M-3 CERTIFICATES AS DESCRIBED IN THE AGREEMENT
REFERRED TO HEREIN.
EXCEPT AS PROVIDED IN SECTION 5.02(D) OF THE AGREEMENT REFERRED TO HEREIN,
NO TRANSFER OF THIS CERTIFICATE SHALL BE REGISTERED UNLESS THE TRUSTEE AND
THE CERTIFICATE REGISTRAR SHALL HAVE RECEIVED (A) A REPRESENTATION FROM
THE TRANSFEREE OF THIS CERTIFICATE TO THE EFFECT THAT SUCH TRANSFEREE IS
NOT AN EMPLOYEE BENEFIT PLAN OR ARRANGEMENT SUBJECT TO TITLE I OF THE
EMPLOYEE RETIREMENT INCOME SECURITY ACT OF 1974, AS AMENDED ("ERISA"), A
PLAN SUBJECT TO SECTION 4975 OF THE INTERNAL REVENUE CODE OF 1986, AS
AMENDED (THE "CODE") OR A PLAN SUBJECT TO STATE, LOCAL OR OTHER FEDERAL
LAW SUBSTANTIVELY SIMILAR TO THE FOREGOING PROVISIONS OF ERISA OR THE CODE
("SIMILAR LAW") (COLLECTIVELY, A "PLAN"), AND IS NOT DIRECTLY OR
INDIRECTLY ACQUIRING THIS CERTIFICATE FOR, ON BEHALF OF OR WITH ANY ASSETS
OF ANY SUCH PLAN, (B) A REPRESENTATION THAT THE TRANSFEREE IS AN INSURANCE
COMPANY THAT IS ACQUIRING THE CERTIFICATE WITH ASSETS OF AN "INSURANCE
COMPANY GENERAL ACCOUNT" AS DEFINED IN SECTION V(E) OF PROHIBITED
TRANSACTION CLASS EXEMPTION ("PTCE") 95-60, OR (C) SOLELY IN THE CASE OF A
DEFINITIVE CERTIFICATE, AN OPINION OF COUNSEL SATISFACTORY TO THE TRUSTEE
AND THE CERTIFICATE REGISTRAR, AND UPON WHICH THE TRUSTEE AND THE
CERTIFICATE REGISTRAR SHALL BE ENTITLED TO RELY, TO THE
B-1-1
EFFECT THAT THE ACQUISITION AND HOLDING OF THIS CERTIFICATE BY THE
TRANSFEREE WILL NOT RESULT IN A NONEXEMPT PROHIBITED TRANSACTION UNDER
TITLE I OF ERISA OR SECTION 4975 OF THE CODE, OR A VIOLATION OF SIMILAR
LAW, AND WILL NOT SUBJECT THE CERTIFICATE REGISTRAR, THE DEPOSITOR, THE
SERVICER OR THE TRUSTEE TO ANY OBLIGATION IN ADDITION TO THOSE UNDERTAKEN
BY SUCH ENTITIES IN THE AGREEMENT REFERRED TO HEREIN, WHICH OPINION OF
COUNSEL SHALL NOT BE AN EXPENSE OF THE CERTIFICATE REGISTRAR, THE
DEPOSITOR, THE SERVICER OR THE TRUSTEE.
FOR U.S. FEDERAL INCOME TAX PURPOSES, THIS CERTIFICATE REPRESENTS
BENEFICIAL OWNERSHIP OF A "REGULAR INTEREST" IN A "REAL ESTATE MORTGAGE
INVESTMENT CONDUIT," AS THOSE TERMS ARE DEFINED, RESPECTIVELY, IN SECTIONS
860G AND 860D OF THE CODE AND CERTAIN OTHER PROPERTY.
B-1-2
C-BASS MORTGAGE LOAN ASSET-BACKED CERTIFICATES
SERIES 2004-CB6, CLASS B-1
evidencing a beneficial ownership interest in a portion of a Trust Fund
consisting primarily of a pool of conventional fixed-rate and adjustable-rate
one- to four-family first and second lien mortgage loans formed and sold by
▇▇▇▇▇▇▇ ▇▇▇▇▇ MORTGAGE INVESTORS, INC.
Series 2004-CB6, Class B-1 Original Class Certificate Principal Balance of the
Class B-1 Certificates as of the Closing
Date: $4,592,000.00
Pass-Through Rate: Variable(1)
Date of Pooling and Servicing Agreement and Initial Certificate Principal Balance: $4,592,000.00
Cut-off Date: August 1, 2004
First Distribution Date: September 27, 2004 Servicer: ▇▇▇▇▇▇ Loan Servicing LP
No. Trustee: U.S. Bank National Association
CUSIP: 59020U JF 3 Closing Date: September 9, 2004
ISIN: US59020UJF30
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.
THIS CERTIFICATE DOES NOT REPRESENT AN OBLIGATION OF OR INTEREST IN
▇▇▇▇▇▇▇ ▇▇▇▇▇ MORTGAGE INVESTORS, INC., THE SERVICER, THE TRUSTEE OR ANY
OF THEIR AFFILIATES. THIS CERTIFICATE IS NOT GUARANTEED BY ANY AGENCY OR
INSTRUMENTALITY OF THE UNITED STATES.
This certifies that CEDE & CO. is the registered owner of a Percentage
Interest (obtained by dividing the Initial Certificate Principal Balance of this
Certificate by the Original Class Certificate Principal Balance of the Class B-1
Certificates) in that certain beneficial ownership interest evidenced by all the
Class B-1 Certificates in the Trust Fund created pursuant to a Pooling and
Servicing Agreement, dated as specified above (the "Agreement"), among ▇▇▇▇▇▇▇
▇▇▇▇▇ Mortgage Investors, Inc. (hereinafter called the "Depositor," which term
includes any successor entity under the Agreement), Credit-Based Asset Servicing
and Securitization LLC (the "Seller"), the Servicer and 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
----------
(1) Subject to a cap as described in the Agreement.
B-1-3
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 Business Day immediately preceding such Distribution Date
(the "Record Date"), from funds in the Distribution Account 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 B-1 Certificates on
such Distribution Date pursuant to the Agreement provided, however, that if any
Class B-1 Certificate becomes a Definitive Certificate, the Record Date for such
Certificate will be the last Business Day of the month immediately preceding the
month in which the related Distribution Date occurs.
All distributions to the Holder of this Certificate under the Agreement
will be made or caused to be made by or on behalf of the Trustee by wire
transfer in immediately available funds to the account of the Person entitled
thereto if such Person shall have so notified the Certificate Registrar 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 B-1 Certificates
the aggregate Initial Certificate Principal Balance of which is in excess of
$5,000,000, or 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, provided that the Certificate Registrar may deduct a reasonable wire
transfer fee from any payment made by wire transfer. Notwithstanding the above,
the final distribution on this Certificate will be made after due notice by the
Trustee of the pendency of such distribution and only upon presentation and
surrender of this Certificate at the office or agency appointed by the Trustee
for that purpose as provided in the Agreement.
The Class B-1 Pass-Through Rate on each Distribution Date will be a rate
per annum equal to the least of (i) LIBOR as of the related LIBOR Determination
Date, plus the Class B-1 Certificate Margin, (ii) the Subordinate Rate Cap and
(iii) the Subordinate Maximum Rate Cap.
This Certificate is one of a duly authorized issue of Certificates
designated as C-BASS Mortgage Loan Asset-Backed Certificates of the Series
specified on the face hereof (herein called the "Certificates") and representing
a Percentage Interest in the Class B-1 Certificates.
The Class B-1 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.
This Certificate is subordinated in right of payment to the Class A, Class
M-1, Class M-2 and Class M-3 Certificates as described in the Agreement.
The Agreement permits, with certain exceptions therein provided, the
amendment thereof and the modification of the rights and obligations of the
Depositor, the Servicer, the Trustee, the
B-1-4
Seller and the rights of the Certificateholders under the Agreement at any time
by the Depositor, the Servicer, the Seller and the Trustee with the consent of
the Holders of Certificates entitled to the Voting Rights identified in the
Agreement. Any such consent by the Holder of this Certificate shall be
conclusive and binding on such Holder and upon all future Holders of this
Certificate and of any Certificate issued upon the transfer hereof or in
exchange 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 Trustee 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 Trustee and the Certificate
Registrar 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 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 service charge will be made for any such registration of transfer or
exchange of Certificates, but the Certificate Registrar 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 Servicer, the Trustee, any Paying Agent and the
Certificate Registrar and any agent of the Depositor, the Servicer, the Trustee,
any Paying Agent or the Certificate Registrar may treat the Person in whose name
this Certificate is registered as the owner hereof for all purposes, and none of
the Depositor, the Servicer, the Trustee, the Certificate Registrar, any Paying
Agent 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 or on behalf of the Trustee 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 the Trust Fund, and (ii) the purchase by the party designated in
the Agreement at a price determined as provided in the Agreement from the Trust
Fund of all 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 the Trust Fund all 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
Principal Balance of the
B-1-5
Mortgage Loans at the time of purchase being 10% or less of the Cut-off Date
Aggregate Principal Balance.
The recitals contained herein shall be taken as statements of the
Depositor and the Trustee assumes no responsibility for their correctness.
Unless the certificate of authentication hereon has been executed by the
Certificate Registrar, by manual signature, this Certificate shall not be
entitled to any benefit under the Agreement or be valid for any purpose.
B-1-6
IN WITNESS WHEREOF, the Trustee has caused this Certificate to be duly
executed.
Dated: September 9, 2004
U.S. BANK NATIONAL ASSOCIATION,
as Trustee
By: __________________________________
Authorized Officer
CERTIFICATE OF AUTHENTICATION
This is one of the Certificates referred to in the within-mentioned
Agreement.
U.S. BANK NATIONAL ASSOCIATION,
as Certificate Registrar
By: __________________________________
Authorized Officer
Date of authentication: September 9, 2004
B-1-7
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)
TEN ENT - as tenants by the entireties under Uniform
Gifts to Minors
JT TEN - as joint tenants with right of Act
survivorship and not as tenants
in common _______________
(State)
Additional abbreviations may also be used though not in the above list.
B-1-8
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
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 Certificate Registrar 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 ___________________________________________________,
the assignee named above, or __________________________________________________,
as its agent.
▇-▇-▇
▇▇▇▇▇▇▇ ▇-▇
FORM OF CLASS B-2 CERTIFICATE
UNLESS THIS CERTIFICATE IS PRESENTED BY AN AUTHORIZED REPRESENTATIVE OF
THE DEPOSITORY TRUST COMPANY, A NEW YORK CORPORATION ("DTC"), TO THE
TRUSTEE OR ITS AGENT FOR REGISTRATION OF TRANSFER, EXCHANGE, OR PAYMENT,
AND ANY CERTIFICATE ISSUED IS REGISTERED IN THE NAME OF CEDE & CO. OR IN
SUCH OTHER NAME AS IS REQUESTED BY AN AUTHORIZED REPRESENTATIVE OF DTC
(AND ANY PAYMENT IS MADE TO CEDE & CO. OR TO SUCH OTHER ENTITY AS IS
REQUESTED BY AN AUTHORIZED REPRESENTATIVE OF DTC), ANY TRANSFER, PLEDGE,
OR OTHER USE HEREOF FOR VALUE OR OTHERWISE BY OR TO ANY PERSON IS WRONGFUL
INASMUCH AS THE REGISTERED OWNER HEREOF, CEDE & CO., HAS AN INTEREST
HEREIN.
THIS CERTIFICATE IS SUBORDINATED IN RIGHT OF PAYMENT TO THE CLASS A, CLASS
M-1, CLASS M-2, CLASS M-3 AND CLASS B-1 CERTIFICATES AS DESCRIBED IN THE
AGREEMENT REFERRED TO HEREIN.
EXCEPT AS PROVIDED IN SECTION 5.02(D) OF THE AGREEMENT REFERRED TO HEREIN,
NO TRANSFER OF THIS CERTIFICATE SHALL BE REGISTERED UNLESS THE TRUSTEE AND
THE CERTIFICATE REGISTRAR SHALL HAVE RECEIVED (A) A REPRESENTATION FROM
THE TRANSFEREE OF THIS CERTIFICATE TO THE EFFECT THAT SUCH TRANSFEREE IS
NOT AN EMPLOYEE BENEFIT PLAN OR ARRANGEMENT SUBJECT TO TITLE I OF THE
EMPLOYEE RETIREMENT INCOME SECURITY ACT OF 1974, AS AMENDED ("ERISA"), A
PLAN SUBJECT TO SECTION 4975 OF THE INTERNAL REVENUE CODE OF 1986, AS
AMENDED (THE "CODE") OR A PLAN SUBJECT TO STATE, LOCAL OR OTHER FEDERAL
LAW SUBSTANTIVELY SIMILAR TO THE FOREGOING PROVISIONS OF ERISA OR THE CODE
("SIMILAR LAW") (COLLECTIVELY, A "PLAN"), AND IS NOT DIRECTLY OR
INDIRECTLY ACQUIRING THIS CERTIFICATE FOR, ON BEHALF OF OR WITH ANY ASSETS
OF ANY SUCH PLAN, (B) A REPRESENTATION THAT THE TRANSFEREE IS AN INSURANCE
COMPANY THAT IS ACQUIRING THE CERTIFICATE WITH ASSETS OF AN "INSURANCE
COMPANY GENERAL ACCOUNT" AS DEFINED IN SECTION V(E) OF PROHIBITED
TRANSACTION CLASS EXEMPTION ("PTCE") 95-60, OR (C) SOLELY IN THE CASE OF A
DEFINITIVE CERTIFICATE, AN OPINION OF COUNSEL SATISFACTORY TO THE TRUSTEE
AND THE CERTIFICATE REGISTRAR, AND UPON WHICH THE TRUSTEE AND THE
B-2-1
CERTIFICATE REGISTRAR SHALL BE ENTITLED TO RELY, TO THE EFFECT THAT THE
ACQUISITION AND HOLDING OF THIS CERTIFICATE BY THE TRANSFEREE WILL NOT
RESULT IN A NONEXEMPT PROHIBITED TRANSACTION UNDER TITLE I OF ERISA OR
SECTION 4975 OF THE CODE, OR A VIOLATION OF SIMILAR LAW, AND WILL NOT
SUBJECT THE CERTIFICATE REGISTRAR, THE DEPOSITOR, THE SERVICER OR THE
TRUSTEE TO ANY OBLIGATION IN ADDITION TO THOSE UNDERTAKEN BY SUCH ENTITIES
IN THE AGREEMENT REFFERED TO HEREIN, WHICH OPINION OF COUNSEL SHALL NOT BE
AN EXPENSE OF THE CERTIFICATE REGISTRAR, THE DEPOSITOR, THE SERVICER OR
THE TRUSTEE.
FOR U.S. FEDERAL INCOME TAX PURPOSES, THIS CERTIFICATE REPRESENTS
BENEFICIAL OWNERSHIP OF A "REGULAR INTEREST" IN A "REAL ESTATE MORTGAGE
INVESTMENT CONDUIT," AS THOSE TERMS ARE DEFINED, RESPECTIVELY, IN SECTIONS
860G AND 860D OF THE CODE AND CERTAIN OTHER PROPERTY.
C-BASS MORTGAGE LOAN ASSET-BACKED CERTIFICATES
SERIES 2004-CB6, CLASS B-2
evidencing a beneficial ownership interest in a portion of a Trust Fund
consisting primarily of a pool of conventional fixed-rate and adjustable-rate
one- to four-family first and second lien mortgage loans formed and sold by
▇▇▇▇▇▇▇ ▇▇▇▇▇ MORTGAGE INVESTORS, INC.
Series 2004-CB6, Class B-2 Original Class Certificate Principal Balance of the
Class B-2 Certificates as of the Closing
Date: $4,592,000.00
Pass-Through Rate: Variable(1)
Date of Pooling and Servicing Agreement and Initial Certificate Principal Balance: $4,592,000.00
Cut-off Date: August 1, 2004
First Distribution Date: September 27, 2004 Servicer: ▇▇▇▇▇▇ Loan Servicing LP
No. Trustee: U.S. Bank National Association
CUSIP: 59020U JG 1 Closing Date: September 9, 2004
ISIN: US59020UJG13
----------
(1) Subject to a cap as described in the Agreement.
B-2-2
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.
THIS CERTIFICATE DOES NOT REPRESENT AN OBLIGATION OF OR INTEREST IN
▇▇▇▇▇▇▇ ▇▇▇▇▇ MORTGAGE INVESTORS, INC., THE SERVICER, THE TRUSTEE OR ANY
OF THEIR AFFILIATES. THIS CERTIFICATE IS NOT GUARANTEED BY ANY AGENCY OR
INSTRUMENTALITY OF THE UNITED STATES.
This certifies that CEDE & CO. is the registered owner of a Percentage
Interest (obtained by dividing the Initial Certificate Principal Balance of this
Certificate by the Original Class Certificate Principal Balance of the Class B-2
Certificates) in that certain beneficial ownership interest evidenced by all the
Class B-2 Certificates in the Trust Fund created pursuant to a Pooling and
Servicing Agreement, dated as specified above (the "Agreement"), among ▇▇▇▇▇▇▇
▇▇▇▇▇ Mortgage Investors, Inc. (hereinafter called the "Depositor," which term
includes any successor entity under the Agreement), Credit-Based Asset Servicing
and Securitization LLC (the "Seller"), the Servicer and 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 Business Day immediately preceding such Distribution Date
(the "Record Date"), from funds in the Distribution Account 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 B-2 Certificates on
such Distribution Date pursuant to the Agreement provided, however, that if any
Class B-2 Certificate becomes a Definitive Certificate, the Record Date for such
Certificate will be the last Business Day of the month immediately preceding the
month in which the related Distribution Date occurs.
All distributions to the Holder of this Certificate under the Agreement
will be made or caused to be made by or on behalf of the Trustee by wire
transfer in immediately available funds to the account of the Person entitled
thereto if such Person shall have so notified the Certificate Registrar 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 B-2 Certificates
the aggregate Initial Certificate Principal Balance of which is in excess of
$5,000,000, or 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, provided that the Certificate Registrar may deduct a reasonable wire
transfer fee from any payment made by wire transfer. Notwithstanding the above,
the final distribution on this Certificate will be made after due notice by the
Trustee of the pendency of such distribution and only upon presentation and
surrender of this Certificate at the office or agency appointed by the Trustee
for that purpose as provided in the Agreement.
B-2-3
The Class B-2 Pass-Through Rate on each Distribution Date will be a rate
per annum equal to the least of (i) LIBOR as of the related LIBOR Determination
Date, plus the Class B-2 Certificate Margin, (ii) the Subordinate Rate Cap and
(iii) the Subordinate Maximum Rate Cap.
This Certificate is one of a duly authorized issue of Certificates
designated as C-BASS Mortgage Loan Asset-Backed Certificates of the Series
specified on the face hereof (herein called the "Certificates") and representing
a Percentage Interest in the Class B-2 Certificates.
The Class B-2 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.
This Certificate is subordinated in right of payment to the Class A, Class
M-1, Class M-2, Class M-3 and Class B-1 Certificates as described in the
Agreement.
The Agreement permits, with certain exceptions therein provided, the
amendment thereof and the modification of the rights and obligations of the
Depositor, the Servicer, the Trustee, the Seller and the rights of the
Certificateholders under the Agreement at any time by the Depositor, the
Servicer, the Seller and the Trustee with the consent of the Holders of
Certificates entitled to the Voting Rights identified in the Agreement. Any such
consent by the Holder of this Certificate shall be conclusive and binding on
such Holder and upon all future Holders of this Certificate and of any
Certificate issued upon the transfer hereof or in exchange 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 Trustee 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 Trustee and the Certificate
Registrar 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 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 service charge will be made for any such registration of transfer or
exchange of Certificates, but the Certificate Registrar may require payment of a
sum sufficient to cover any
B-2-4
tax or other governmental charge that may be imposed in connection with any
transfer or exchange of Certificates.
The Depositor, the Servicer, the Trustee, any Paying Agent and the
Certificate Registrar and any agent of the Depositor, the Servicer, the Trustee,
any Paying Agent or the Certificate Registrar may treat the Person in whose name
this Certificate is registered as the owner hereof for all purposes, and none of
the Depositor, the Servicer, the Trustee, the Certificate Registrar, any Paying
Agent 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 or on behalf of the Trustee 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 the Trust Fund, and (ii) the purchase by the party designated in
the Agreement at a price determined as provided in the Agreement from the Trust
Fund of all 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 the Trust Fund all 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
Principal Balance of the Mortgage Loans at the time of purchase being 10% or
less of the Cut-off Date Aggregate Principal Balance.
The recitals contained herein shall be taken as statements of the
Depositor and the Trustee assumes no responsibility for their correctness.
Unless the certificate of authentication hereon has been executed by the
Certificate Registrar, by manual signature, this Certificate shall not be
entitled to any benefit under the Agreement or be valid for any purpose.
B-2-5
IN WITNESS WHEREOF, the Trustee has caused this Certificate to be duly
executed.
Dated: September 9, 2004
U.S. BANK NATIONAL ASSOCIATION,
as Trustee
By: _________________________________
Authorized Officer
CERTIFICATE OF AUTHENTICATION
This is one of the Certificates referred to in the within-mentioned Agreement.
U.S. BANK NATIONAL ASSOCIATION,
as Certificate Registrar
By: _________________________________
Authorized Officer
Date of authentication: September 9, 2004
B-2-6
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)
TEN ENT - as tenants by the entireties under Uniform
Gifts to Minors
JT TEN - as joint tenants with right of Act
survivorship and not as tenants
in common _______________
(State)
Additional abbreviations may also be used though not in the above list.
B-2-7
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
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 Certificate Registrar 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 ___________________________________________________,
the assignee named above, or __________________________________________________,
as its agent.
▇-▇-▇
▇▇▇▇▇▇▇ ▇-▇
FORM OF CLASS B-3 CERTIFICATE
UNLESS THIS CERTIFICATE IS PRESENTED BY AN AUTHORIZED REPRESENTATIVE OF
THE DEPOSITORY TRUST COMPANY, A NEW YORK CORPORATION ("DTC"), TO THE
TRUSTEE OR ITS AGENT FOR REGISTRATION OF TRANSFER, EXCHANGE, OR PAYMENT,
AND ANY CERTIFICATE ISSUED IS REGISTERED IN THE NAME OF CEDE & CO. OR IN
SUCH OTHER NAME AS IS REQUESTED BY AN AUTHORIZED REPRESENTATIVE OF DTC
(AND ANY PAYMENT IS MADE TO CEDE & CO. OR TO SUCH OTHER ENTITY AS IS
REQUESTED BY AN AUTHORIZED REPRESENTATIVE OF DTC), ANY TRANSFER, PLEDGE,
OR OTHER USE HEREOF FOR VALUE OR OTHERWISE BY OR TO ANY PERSON IS WRONGFUL
INASMUCH AS THE REGISTERED OWNER HEREOF, CEDE & CO., HAS AN INTEREST
HEREIN.
THIS CERTIFICATE IS SUBORDINATED IN RIGHT OF PAYMENT TO THE CLASS A, CLASS
M-1, CLASS M-2, CLASS M-3, CLASS B-1 AND CLASS B-2 CERTIFICATES AS
DESCRIBED IN THE AGREEMENT REFERRED TO HEREIN.
EXCEPT AS PROVIDED IN SECTION 5.02(D) OF THE AGREEMENT REFERRED TO HEREIN,
NO TRANSFER OF THIS CERTIFICATE SHALL BE REGISTERED UNLESS THE TRUSTEE AND
THE CERTIFICATE REGISTRAR SHALL HAVE RECEIVED (A) A REPRESENTATION FROM
THE TRANSFEREE OF THIS CERTIFICATE TO THE EFFECT THAT SUCH TRANSFEREE IS
NOT AN EMPLOYEE BENEFIT PLAN OR ARRANGEMENT SUBJECT TO TITLE I OF THE
EMPLOYEE RETIREMENT INCOME SECURITY ACT OF 1974, AS AMENDED ("ERISA"), A
PLAN SUBJECT TO SECTION 4975 OF THE INTERNAL REVENUE CODE OF 1986, AS
AMENDED (THE "CODE") OR A PLAN SUBJECT TO STATE, LOCAL OR OTHER FEDERAL
LAW SUBSTANTIVELY SIMILAR TO THE FOREGOING PROVISIONS OF ERISA OR THE CODE
("SIMILAR LAW") (COLLECTIVELY, A "PLAN"), AND IS NOT DIRECTLY OR
INDIRECTLY ACQUIRING THIS CERTIFICATE FOR, ON BEHALF OF OR WITH ANY ASSETS
OF ANY SUCH PLAN, (B) A REPRESENTATION THAT THE TRANSFEREE IS AN INSURANCE
COMPANY THAT IS ACQUIRING THE CERTIFICATE WITH ASSETS OF AN "INSURANCE
COMPANY GENERAL ACCOUNT" AS DEFINED IN SECTION V(E) OF PROHIBITED
TRANSACTION CLASS EXEMPTION ("PTCE") 95-60, OR (C) SOLELY IN THE CASE OF A
DEFINITIVE CERTIFICATE, AN OPINION OF COUNSEL SATISFACTORY TO THE TRUSTEE
AND THE CERTIFICATE REGISTRAR, AND UPON WHICH THE TRUSTEE AND THE
B-3-1
CERTIFICATE REGISTRAR SHALL BE ENTITLED TO RELY, TO THE EFFECT THAT THE
ACQUISITION AND HOLDING OF THIS CERTIFICATE BY THE TRANSFEREE WILL NOT
RESULT IN A NONEXEMPT PROHIBITED TRANSACTION UNDER TITLE I OF ERISA OR
SECTION 4975 OF THE CODE, OR A VIOLATION OF SIMILAR LAW, AND WILL NOT
SUBJECT THE CERTIFICATE REGISTRAR, THE DEPOSITOR, THE SERVICER OR THE
TRUSTEE TO ANY OBLIGATION IN ADDITION TO THOSE UNDERTAKEN BY SUCH ENTITIES
IN THE AGREEMENT REFERRED TO HEREIN, WHICH OPINION OF COUNSEL SHALL NOT BE
AN EXPENSE OF THE CERTIFICATE REGISTRAR, THE DEPOSITOR, THE SERVICER OR
THE TRUSTEE.
FOR U.S. FEDERAL INCOME TAX PURPOSES, THIS CERTIFICATE REPRESENTS
BENEFICIAL OWNERSHIP OF A "REGULAR INTEREST" IN A "REAL ESTATE MORTGAGE
INVESTMENT CONDUIT," AS THOSE TERMS ARE DEFINED, RESPECTIVELY, IN SECTIONS
860G AND 860D OF THE CODE AND CERTAIN OTHER PROPERTY.
C-BASS MORTGAGE LOAN ASSET-BACKED CERTIFICATES
SERIES 2004-CB6, CLASS B-3
evidencing a beneficial ownership interest in a portion of a Trust Fund
consisting primarily of a pool of conventional fixed-rate and adjustable-rate
one- to four-family first and second lien mortgage loans formed and sold by
▇▇▇▇▇▇▇ ▇▇▇▇▇ MORTGAGE INVESTORS, INC.
Series 2004-CB6, Class B-3 Original Class Certificate
Principal Balance of the Class B-3
Certificates as of the Closing Date:
$4,592,000.00
Pass-Through Rate: Variable(1)
Date of Pooling and Servicing Agreement and Initial Certificate Principal Balance:
Cut-off Date: August 1, 2004 $4,592,000.00
First Distribution Date: September 27, 2004 Servicer: ▇▇▇▇▇▇ Loan Servicing LP
No. Trustee: U.S. Bank National Association
CUSIP: 59020U JH 9 Closing Date: September 9, 2004
ISIN: US59020UJH95
DISTRIBUTIONS IN REDUCTION OF THE CERTIFICATE PRINCIPAL BALANCE OF THIS
CERTIFICATE MAY BE MADE MONTHLY AS
-------
(1) Subject to a cap as described in the Agreement.
B-3-2
SET FORTH HEREIN. ACCORDINGLY, THE OUTSTANDING CERTIFICATE PRINCIPAL
BALANCE HEREOF AT ANY TIME MAY BE LESS THAN THE AMOUNT SHOWN ABOVE.
THIS CERTIFICATE DOES NOT REPRESENT AN OBLIGATION OF OR INTEREST IN
▇▇▇▇▇▇▇ ▇▇▇▇▇ MORTGAGE INVESTORS, INC., THE SERVICER, THE TRUSTEE OR ANY
OF THEIR AFFILIATES. THIS CERTIFICATE IS NOT GUARANTEED BY ANY AGENCY OR
INSTRUMENTALITY OF THE UNITED STATES.
This certifies that CEDE & CO. is the registered owner of a Percentage
Interest (obtained by dividing the Initial Certificate Principal Balance of this
Certificate by the Original Class Certificate Principal Balance of the Class B-3
Certificates) in that certain beneficial ownership interest evidenced by all the
Class B-3 Certificates in the Trust Fund created pursuant to a Pooling and
Servicing Agreement, dated as specified above (the "Agreement"), among ▇▇▇▇▇▇▇
▇▇▇▇▇ Mortgage Investors, Inc. (hereinafter called the "Depositor," which term
includes any successor entity under the Agreement), Credit-Based Asset Servicing
and Securitization LLC (the "Seller"), the Servicer and 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 Business Day immediately preceding such Distribution Date
(the "Record Date"), from funds in the Distribution Account 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 B-3 Certificates on
such Distribution Date pursuant to the Agreement provided, however, that if any
Class B-3 Certificate becomes a Definitive Certificate, the Record Date for such
Certificate will be the last Business Day of the month immediately preceding the
month in which the related Distribution Date occurs.
All distributions to the Holder of this Certificate under the Agreement
will be made or caused to be made by or on behalf of the Trustee by wire
transfer in immediately available funds to the account of the Person entitled
thereto if such Person shall have so notified the Certificate Registrar 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 B-3 Certificates
the aggregate Initial Certificate Principal Balance of which is in excess of
$5,000,000, or 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, provided that the Certificate Registrar may deduct a reasonable wire
transfer fee from any payment made by wire transfer. Notwithstanding the above,
the final distribution on this Certificate will be made after due notice by the
Trustee of the pendency of such distribution and only upon presentation and
surrender of this Certificate at the office or agency appointed by the Trustee
for that purpose as provided in the Agreement.
B-3-3
The Class B-3 Pass-Through Rate on each Distribution Date will be a rate
per annum equal to the least of (i) LIBOR as of the related LIBOR Determination
Date, plus the Class B-3 Certificate Margin, (ii) the Subordinate Rate Cap and
(iii) the Subordinate Maximum Rate Cap.
This Certificate is one of a duly authorized issue of Certificates
designated as C-BASS Mortgage Loan Asset-Backed Certificates of the Series
specified on the face hereof (herein called the "Certificates") and representing
a Percentage Interest in the Class B-3 Certificates.
The Class B-3 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.
This Certificate is subordinated in right of payment to the Class A, Class
M-1, Class M-2, Class M-3, Class B-1 and Class B-2 Certificates as described in
the Agreement.
The Agreement permits, with certain exceptions therein provided, the
amendment thereof and the modification of the rights and obligations of the
Depositor, the Servicer, the Trustee, the Seller and the rights of the
Certificateholders under the Agreement at any time by the Depositor, the
Servicer, the Seller and the Trustee with the consent of the Holders of
Certificates entitled to the Voting Rights identified in the Agreement. Any such
consent by the Holder of this Certificate shall be conclusive and binding on
such Holder and upon all future Holders of this Certificate and of any
Certificate issued upon the transfer hereof or in exchange 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 Trustee 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 Trustee and the Certificate
Registrar 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 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 service charge will be made for any such registration of transfer or
exchange of Certificates, but the Certificate Registrar may require payment of a
sum sufficient to cover any
B-3-4
tax or other governmental charge that may be imposed in connection with any
transfer or exchange of Certificates.
The Depositor, the Servicer, the Trustee, any Paying Agent and the
Certificate Registrar and any agent of the Depositor, the Servicer, the Trustee,
any Paying Agent or the Certificate Registrar may treat the Person in whose name
this Certificate is registered as the owner hereof for all purposes, and none of
the Depositor, the Servicer, the Trustee, the Certificate Registrar, any Paying
Agent 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 or on behalf of the Trustee 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 the Trust Fund, and (ii) the purchase by the party designated in
the Agreement at a price determined as provided in the Agreement from the Trust
Fund of all 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 the Trust Fund all 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
Principal Balance of the Mortgage Loans at the time of purchase being 10% or
less of the Cut-off Date Aggregate Principal Balance.
The recitals contained herein shall be taken as statements of the
Depositor and the Trustee assumes no responsibility for their correctness.
Unless the certificate of authentication hereon has been executed by the
Certificate Registrar, by manual signature, this Certificate shall not be
entitled to any benefit under the Agreement or be valid for any purpose.
B-3-5
IN WITNESS WHEREOF, the Trustee has caused this Certificate to be duly
executed.
Dated: September 9, 2004
U.S. BANK NATIONAL ASSOCIATION,
as Trustee
By: _______________________________
Authorized Officer
CERTIFICATE OF AUTHENTICATION
This is one of the Certificates referred to in the within-mentioned
Agreement.
U.S. BANK NATIONAL ASSOCIATION,
as Certificate Registrar
By: _______________________________
Authorized Signatory
Date of authentication: September 9, 2004
B-3-6
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)
TEN ENT - as tenants by the entireties under Uniform
Gifts to Minors Act
JT TEN - as joint tenants with right of
survivorship and not as tenants
in common
____________________
(State)
Additional abbreviations may also be used though not in the above list.
B-3-7
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
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 Certificate Registrar 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 ___________________________________________________,
the assignee named above, or __________________________________________________,
as its agent.
▇-▇-▇
▇▇▇▇▇▇▇ ▇-▇-▇
FORM OF CLASS B-4 (144A) CERTIFICATE
SOLELY FOR FEDERAL INCOME TAX PURPOSES, THIS CERTIFICATE REPRESENTS A
"REGULAR INTEREST" IN A "REAL ESTATE MORTGAGE INVESTMENT CONDUIT", AS
THOSE TERMS ARE DEFINED, RESPECTIVELY, IN SECTIONS 860G AND 860D OF THE
INTERNAL REVENUE CODE OF 1986, AS AMENDED.
THIS CERTIFICATE DOES NOT REPRESENT AN OBLIGATION OF OR INTEREST IN
▇▇▇▇▇▇▇ ▇▇▇▇▇ MORTGAGE INVESTORS, INC. ("MLMI"), THE TRUSTEE OR ANY
SERVICER REFERRED TO BELOW OR ANY OF THEIR AFFILIATES. NEITHER THIS
CERTIFICATE, THE REMIC REGULAR INTEREST REPRESENTED HEREBY NOR THE
UNDERLYING MORTGAGE LOANS ARE GUARANTEED OR INSURED BY MLMI, THE TRUSTEE,
ANY SERVICER OR BY ANY OF THEIR AFFILIATES OR BY ANY GOVERNMENTAL AGENCY
OR INSTRUMENTALITY.
FOLLOWING THE INITIAL ISSUANCE OF THE CERTIFICATES, THE PRINCIPAL BALANCE
OF THIS CERTIFICATE MAY BE DIFFERENT FROM THE ORIGINAL DENOMINATION SHOWN
BELOW. ANYONE ACQUIRING THIS CERTIFICATE MAY ASCERTAIN ITS CURRENT
PRINCIPAL BALANCE BY INQUIRY OF THE TRUSTEE.
THIS CERTIFICATE HAS NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933
, AS AMENDED (THE "1933 ACT") OR ANY STATE SECURITIES LAWS. NEITHER THIS
CERTIFICATE NOR ANY INTEREST OR PARTICIPATION HEREIN MAY BE REOFFERED,
SOLD, ASSIGNED, TRANSFERRED, PLEDGED, ENCUMBERED OR OTHERWISE DISPOSED OF
IN THE ABSENCE OF SUCH REGISTRATION, UNLESS SUCH TRANSACTION IS EXEMPT
FROM, OR NOT SUBJECT TO, REGISTRATION.
THE HOLDER OF THIS CERTIFICATE BY ITS ACCEPTANCE HEREOF AGREES TO OFFER,
SELL OR OTHERWISE TRANSFER SUCH CERTIFICATE ONLY (A) PURSUANT TO A
REGISTRATION STATEMENT WHICH HAS BEEN DECLARED EFFECTIVE UNDER THE 1933
ACT OR (B) TO A PERSON IT REASONABLY BELIEVES IS A "QUALIFIED
INSTITUTIONAL BUYER" AS DEFINED IN RULE 144A UNDER THE 1933 ACT THAT
PURCHASES FOR ITS OWN ACCOUNT OR FOR THE ACCOUNT OF A QUALIFIED
INSTITUTIONAL BUYER TO WHOM NOTICE IS GIVEN THAT THE TRANSFER IS BEING
MADE IN RELIANCE ON RULE 144A, SUBJECT TO THE TRUSTEE'S RIGHT PRIOR TO ANY
SUCH OFFER, SALE OR TRANSFER TO REQUIRE THE DELIVERY OF A CERTIFICATE OF
TRANSFER IN
B-4-1-1
THE FORM APPEARING IN THE POOLING AND SERVICING AGREEMENT.
EXCEPT AS PROVIDED IN SECTION 5.02(D) OF THE AGREEMENT REFERRED TO HEREIN,
NO TRANSFER OF THIS CERTIFICATE SHALL BE REGISTERED UNLESS THE TRUSTEE AND
THE CERTIFICATE REGISTRAR SHALL HAVE RECEIVED (A) A REPRESENTATION FROM
THE TRANSFEREE OF THIS CERTIFICATE TO THE EFFECT THAT SUCH TRANSFEREE IS
NOT AN EMPLOYEE BENEFIT PLAN OR ARRANGEMENT SUBJECT TO TITLE I OF THE
EMPLOYEE RETIREMENT INCOME SECURITY ACT OF 1974, AS AMENDED ("ERISA"), A
PLAN SUBJECT TO SECTION 4975 OF THE INTERNAL REVENUE CODE OF 1986, AS
AMENDED (THE "CODE") OR A PLAN SUBJECT TO STATE, LOCAL OR OTHER FEDERAL
LAW SUBSTANTIVELY SIMILAR TO THE FOREGOING PROVISIONS OF ERISA OR THE CODE
("SIMILAR LAW") (COLLECTIVELY, A "PLAN"), AND IS NOT DIRECTLY OR
INDIRECTLY ACQUIRING THIS CERTIFICATE FOR, ON BEHALF OF OR WITH ANY ASSETS
OF ANY SUCH PLAN, (B) A REPRESENTATION THAT THE TRANSFEREE IS AN INSURANCE
COMPANY THAT IS ACQUIRING THE CERTIFICATE WITH ASSETS OF AN "INSURANCE
COMPANY GENERAL ACCOUNT" AS DEFINED IN SECTION V(E) OF PROHIBITED
TRANSACTION CLASS EXEMPTION ("PTCE") 95-60, OR (C) SOLELY IN THE CASE OF A
DEFINITIVE CERTIFICATE, AN OPINION OF COUNSEL SATISFACTORY TO THE TRUSTEE
AND THE CERTIFICATE REGISTRAR, AND UPON WHICH THE TRUSTEE AND THE
CERTIFICATE REGISTRAR SHALL BE ENTITLED TO RELY, TO THE EFFECT THAT THE
ACQUISITION AND HOLDING OF THIS CERTIFICATE BY THE TRANSFEREE WILL NOT
RESULT IN A NONEXEMPT PROHIBITED TRANSACTION UNDER TITLE I OF ERISA OR
SECTION 4975 OF THE CODE, OR A VIOLATION OF SIMILAR LAW, AND WILL NOT
SUBJECT THE CERTIFICATE REGISTRAR, THE DEPOSITOR, THE SERVICER OR THE
TRUSTEE TO ANY OBLIGATION IN ADDITION TO THOSE UNDERTAKEN BY SUCH ENTITIES
IN THE AGREEMENT REFERRED TO HEREIN, WHICH OPINION OF COUNSEL SHALL NOT BE
AN EXPENSE OF THE CERTIFICATE REGISTRAR, THE DEPOSITOR, THE SERVICER OR
THE TRUSTEE.
B-4-1-2
C-BASS MORTGAGE LOAN ASSET-BACKED CERTIFICATES
SERIES 2004-CB6, CLASS B-4
(RULE 144A)
evidencing a beneficial ownership interest in a portion of a Trust Fund
consisting primarily of a pool of conventional fixed-rate and adjustable-rate
one- to four-family first and second lien mortgage loans formed and sold by
▇▇▇▇▇▇▇ ▇▇▇▇▇ MORTGAGE INVESTORS, INC.
Series 2004-CB6, Class B-4 Original Class Certificate Principal Balance of the
Class B-4 Certificates as of the Closing Date:
$9,185,000.00
Pass-Through Rate: 6.000%
Date of Pooling and Servicing Agreement and Cut-off Initial Certificate Principal Balance: $9,185,000.00
Date: August 1, 2004
First Distribution Date: September 27, 2004 Servicer: ▇▇▇▇▇▇ Loan Servicing LP
No. Trustee: U.S. Bank National Association
CUSIP: 59020U JL 0 Closing Date: September 9, 2004
ISIN: US59020UJL08
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.
THIS CERTIFICATE DOES NOT REPRESENT AN OBLIGATION OF OR INTEREST IN
▇▇▇▇▇▇▇ ▇▇▇▇▇ MORTGAGE INVESTORS, INC., THE SERVICER, THE TRUSTEE OR ANY
OF THEIR AFFILIATES. THIS CERTIFICATE IS NOT GUARANTEED BY ANY AGENCY OR
INSTRUMENTALITY OF THE UNITED STATES.
This certifies that CEDE & CO. is the registered owner of a Percentage
Interest (obtained by dividing the Initial Certificate Principal Balance of this
Certificate by the Original Class Certificate Principal Balance of the Class B-4
Certificates) in that certain beneficial ownership interest evidenced by all the
Class B-4 Certificates in the Trust Fund created pursuant to a Pooling and
Servicing Agreement, dated as specified above (the "Agreement"), among ▇▇▇▇▇▇▇
▇▇▇▇▇ Mortgage Investors, Inc. (hereinafter called the "Depositor," which term
includes any successor entity under the Agreement), Credit-Based Asset Servicing
and Securitization LLC (the "Seller"), the Servicer and 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.
B-4-1-3
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 Business Day immediately preceding such Distribution Date
(the "Record Date"), from funds in the Distribution Account 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 B-4 Certificates on
such Distribution Date pursuant to the Agreement provided, however, that if any
Class B-4 Certificate becomes a Definitive Certificate, the Record Date for such
Certificate will be the last Business Day of the month immediately preceding the
month in which the related Distribution Date occurs.
All distributions to the Holder of this Certificate under the Agreement
will be made or caused to be made by or on behalf of the Trustee by wire
transfer in immediately available funds to the account of the Person entitled
thereto if such Person shall have so notified the Certificate Registrar 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 B-4 Certificates
the aggregate Initial Certificate Principal Balance of which is in excess of
$5,000,000, or 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, provided that the Certificate Registrar may deduct a reasonable wire
transfer fee from any payment made by wire transfer. Notwithstanding the above,
the final distribution on this Certificate will be made after due notice by the
Trustee of the pendency of such distribution and only upon presentation and
surrender of this Certificate at the office or agency appointed by the Trustee
for that purpose as provided in the Agreement.
The Class B-4 Pass-Through Rate on each Distribution Date will be a rate
per annum equal to the least of (i) the Class B-4 Pass-Through Rate (ii) the
Subordinate Rate Cap and (iii) the Subordinate Maximum Rate Cap.
This Certificate is one of a duly authorized issue of Certificates
designated as C-BASS Mortgage Loan Asset-Backed Certificates of the Series
specified on the face hereof (herein called the "Certificates") and representing
a Percentage Interest in the Class B-4 Certificates.
The Class B-4 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.
This Certificate is subordinated in right of payment to the Class A, Class
M-1, Class M-2, Class M-3, Class B-1, Class B-2 and Class B-3 Certificates as
described in the Agreement.
The Agreement permits, with certain exceptions therein provided, the
amendment thereof and the modification of the rights and obligations of the
Depositor, the Servicer, the Trustee, the Seller and the rights of the
Certificateholders under the Agreement at any time by the Depositor, the
Servicer, the Seller and the Trustee with the consent of the Holders of
Certificates entitled to the Voting Rights identified in the Agreement. Any such
consent by the Holder of this
B-4-1-4
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 Trustee 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 Trustee and the Certificate
Registrar 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 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 that transfer is made
pursuant to an effective registration statement under the 1933 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 a transfer is to be made without registration or qualification
(i) the Certificateholder desiring to effect the transfer and such
Certificateholder's prospective transferee shall each execute a representation
letter in the form described by the Agreement certifying to the Certificate
Registrar the facts surrounding the transfer, and (ii) unless such transfer is
made in reliance upon Rule 144A under the 1933 Act, the Depositor and the
Certificate Registrar may require an Opinion of Counsel satisfactory to them
that such transfer may be made without such registration or qualification, which
Opinion of Counsel shall not be an expense of the Depositor, the Trustee or the
Certificate Registrar, in their respective capacities as such. None of the
Depositor, the Certificate Registrar or the Trustee is obligated to register or
qualify the Class of Certificates specified on the face hereof under the 1933
Act or any other securities law or to take any action not otherwise required
under the Agreement to permit the transfer of such Certificates without
registration or qualification. Any such Certificateholder desiring to effect
such transfer shall, and does hereby agree to, indemnify the Trustee, the
Depositor, the Certificate Registrar and the Servicer 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. Each Person who acquires this Certificate or an
interest therein shall be deemed to have made the representations required by
the representation letter referred to in this paragraph, unless such Person
shall have provided such representation letter referred to in this paragraph to
the Certificate Registrar.
No service charge will be made for any such registration of transfer or
exchange of Certificates, but the Certificate Registrar may require payment of a
sum sufficient to cover any
B-4-1-5
tax or other governmental charge that may be imposed in connection with any
transfer or exchange of Certificates.
The Depositor, the Servicer, the Trustee, any Paying Agent and the
Certificate Registrar and any agent of the Depositor, the Servicer, the Trustee,
any Paying Agent or the Certificate Registrar may treat the Person in whose name
this Certificate is registered as the owner hereof for all purposes, and none of
the Depositor, the Servicer, the Trustee, the Certificate Registrar, any Paying
Agent 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 or on behalf of the Trustee 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 the Trust Fund, and (ii) the purchase by the party designated in
the Agreement at a price determined as provided in the Agreement from the Trust
Fund of all 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 the Trust Fund all 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
Principal Balance of the Mortgage Loans at the time of purchase being 10% or
less of the Cut-off Date Aggregate Principal Balance.
The recitals contained herein shall be taken as statements of the
Depositor and the Trustee assumes no responsibility for their correctness.
Unless the certificate of authentication hereon has been executed by the
Certificate Registrar, by manual signature, this Certificate shall not be
entitled to any benefit under the Agreement or be valid for any purpose.
B-4-1-6
IN WITNESS WHEREOF, the Trustee has caused this Certificate to be duly
executed.
Dated: September 9, 2004
U.S. BANK NATIONAL ASSOCIATION,
as Trustee
By: _______________________________
Authorized Officer
CERTIFICATE OF AUTHENTICATION
This is one of the Certificates referred to in the within-mentioned
Agreement.
U.S. BANK NATIONAL ASSOCIATION,
as Certificate Registrar
By: _______________________________
Authorized Signatory
Date of authentication: September 9, 2004
B-4-1-7
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)
TEN ENT - as tenants by the entireties under Uniform
Gifts to Minors
JT TEN - as joint tenants with right of Act
survivorship and not as tenants
in common
_________________
(State)
Additional abbreviations may also be used though not in the above list.
B-4-1-8
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
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 Certificate Registrar 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 _____________________________________, the
assignee named above, or __________________________________________________, as
its agent.
▇-▇-▇-▇
▇▇▇▇▇▇▇ ▇-▇-▇
FORM OF CLASS B-4 (REG S) CERTIFICATE
SOLELY FOR FEDERAL INCOME TAX PURPOSES, THIS CERTIFICATE REPRESENTS A
"REGULAR INTEREST" IN A "REAL ESTATE MORTGAGE INVESTMENT CONDUIT", AS
THOSE TERMS ARE DEFINED, RESPECTIVELY, IN SECTIONS 860G AND 860D OF THE
INTERNAL REVENUE CODE OF 1986, AS AMENDED.
THIS CERTIFICATE DOES NOT REPRESENT AN OBLIGATION OF OR INTEREST IN
▇▇▇▇▇▇▇ ▇▇▇▇▇ MORTGAGE INVESTORS, INC. ("MLMI"), THE TRUSTEE OR ANY
SERVICER REFERRED TO BELOW OR ANY OF THEIR AFFILIATES. NEITHER THIS
CERTIFICATE, THE REMIC REGULAR INTEREST REPRESENTED HEREBY NOR THE
UNDERLYING MORTGAGE LOANS ARE GUARANTEED OR INSURED BY MLMI, THE TRUSTEE,
ANY SERVICER OR BY ANY OF THEIR AFFILIATES OR BY ANY GOVERNMENTAL AGENCY
OR INSTRUMENTALITY.
FOLLOWING THE INITIAL ISSUANCE OF THE CERTIFICATES, THE PRINCIPAL BALANCE
OF THIS CERTIFICATE MAY BE DIFFERENT FROM THE ORIGINAL DENOMINATION SHOWN
BELOW. ANYONE ACQUIRING THIS CERTIFICATE MAY ASCERTAIN ITS CURRENT
PRINCIPAL BALANCE BY INQUIRY OF THE TRUSTEE.
THIS CERTIFICATE HAS NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933,
AS AMENDED (THE "1933 ACT") OR ANY STATE SECURITIES LAWS. NEITHER THIS
CERTIFICATE NOR ANY INTEREST OR PARTICIPATION HEREIN MAY BE REOFFERED,
SOLD, ASSIGNED, TRANSFERRED, PLEDGED, ENCUMBERED OR OTHERWISE DISPOSED OF
WITHIN THE UNITED STATES (AS DEFINED IN RULES 901 THROUGH 905 OF THE 1933
ACT ("REGULATION S")) OR TO, OR FOR THE ACCOUNT OR BENEFIT OF, A U.S.
PERSON (AS DEFINED IN REGULATION S), IN THE ABSENCE OF SUCH REGISTRATION,
UNLESS SUCH TRANSACTION IS EXEMPT FROM, OR NOT SUBJECT TO, REGISTRATION.
THE HOLDER OF THIS CERTIFICATE BY ITS ACCEPTANCE HEREOF AGREES (A) THAT,
UNTIL THE EXPIRATION OF THE APPLICABLE "DISTRIBUTION COMPLIANCE PERIOD"
WITHIN THE MEANING OF REGULATION S, ANY OFFER, SALE, PLEDGE OR OTHER
TRANSFER OF THIS CERTIFICATE SHALL NOT BE MADE IN THE UNITED STATES OR TO,
OR FOR THE ACCOUNT OR BENEFIT OF, ANY U.S. PERSON (EACH AS DEFINED IN
REGULATION S) AND (B) TO OFFER, SELL, PLEDGE OR OTHERWISE TRANSFER THIS
CERTIFICATE WITHIN THE UNITED STATES OR TO, OR FOR THE ACCOUNT OR BENEFIT
OF, A U.S.
B-4-2-1
PERSON (EACH AS DEFINED IN REGULATION S) ONLY (1) PURSUANT TO A
REGISTRATION STATEMENT WHICH HAS BEEN DECLARED EFFECTIVE UNDER THE 1933
ACT OR (2) TO A PERSON IT REASONABLY BELIEVES IS A "QUALIFIED
INSTITUTIONAL BUYER" AS DEFINED IN RULE 144A UNDER THE 1933 ACT THAT
PURCHASES FOR ITS OWN ACCOUNT OR FOR THE ACCOUNT OF A QUALIFIED
INSTITUTIONAL BUYER TO WHOM NOTICE IS GIVEN THAT THE TRANSFER IS BEING
MADE IN RELIANCE ON RULE 144A, SUBJECT TO THE TRUSTEE'S RIGHT PRIOR TO ANY
SUCH OFFER, SALE OR TRANSFER TO REQUIRE THE DELIVERY OF A CERTIFICATE OF
TRANSFER IN THE FORM APPEARING IN THE POOLING AND SERVICING AGREEMENT.
EXCEPT AS PROVIDED IN SECTION 5.02(D) OF THE AGREEMENT REFERRED TO HEREIN,
NO TRANSFER OF THIS CERTIFICATE SHALL BE REGISTERED UNLESS THE TRUSTEE AND
THE CERTIFICATE REGISTRAR SHALL HAVE RECEIVED (A) A REPRESENTATION FROM
THE TRANSFEREE OF THIS CERTIFICATE TO THE EFFECT THAT SUCH TRANSFEREE IS
NOT AN EMPLOYEE BENEFIT PLAN OR ARRANGEMENT SUBJECT TO TITLE I OF THE
EMPLOYEE RETIREMENT INCOME SECURITY ACT OF 1974, AS AMENDED ("ERISA"), A
PLAN SUBJECT TO SECTION 4975 OF THE INTERNAL REVENUE CODE OF 1986, AS
AMENDED (THE "CODE") OR A PLAN SUBJECT TO STATE, LOCAL OR OTHER FEDERAL
LAW SUBSTANTIVELY SIMILAR TO THE FOREGOING PROVISIONS OF ERISA OR THE CODE
("SIMILAR LAW") (COLLECTIVELY, A "PLAN"), AND IS NOT DIRECTLY OR
INDIRECTLY ACQUIRING THIS CERTIFICATE FOR, ON BEHALF OF OR WITH ANY ASSETS
OF ANY SUCH PLAN, (B) A REPRESENTATION THAT THE TRANSFEREE IS AN INSURANCE
COMPANY THAT IS ACQUIRING THE CERTIFICATE WITH ASSETS OF AN "INSURANCE
COMPANY GENERAL ACCOUNT" AS DEFINED IN SECTION V(E) OF PROHIBITED
TRANSACTION CLASS EXEMPTION ("PTCE") 95-60, OR (C) SOLELY IN THE CASE OF A
DEFINITIVE CERTIFICATE, AN OPINION OF COUNSEL SATISFACTORY TO THE TRUSTEE
AND THE CERTIFICATE REGISTRAR, AND UPON WHICH THE TRUSTEE AND THE
CERTIFICATE REGISTRAR SHALL BE ENTITLED TO RELY, TO THE EFFECT THAT THE
ACQUISITION AND HOLDING OF THIS CERTIFICATE BY THE TRANSFEREE WILL NOT
RESULT IN A NONEXEMPT PROHIBITED TRANSACTION UNDER TITLE I OF ERISA OR
SECTION 4975 OF THE CODE, OR A VIOLATION OF SIMILAR LAW, AND WILL NOT
SUBJECT THE CERTIFICATE REGISTRAR, THE DEPOSITOR, THE SERVICER OR THE
TRUSTEE TO ANY OBLIGATION IN ADDITION TO THOSE UNDERTAKEN BY SUCH ENTITIES
IN THE AGREEMENT REFERRED TO HEREIN, WHICH OPINION OF COUNSEL SHALL NOT BE
AN EXPENSE OF
B-4-2-2
THE CERTIFICATE REGISTRAR, THE DEPOSITOR, THE SERVICER OR THE TRUSTEE.
C-BASS MORTGAGE LOAN ASSET-BACKED CERTIFICATES
SERIES 2004-CB6, CLASS B-4
(REGULATION S)
evidencing a beneficial ownership interest in a portion of a Trust Fund
consisting primarily of a pool of conventional fixed-rate and adjustable-rate
one- to four-family first and second lien mortgage loans formed and sold by
▇▇▇▇▇▇▇ ▇▇▇▇▇ MORTGAGE INVESTORS, INC.
Series 2004-CB6, Class B-4 Original Class Certificate Principal Balance of the
Class B-4 Certificates as of the Closing Date:
$9,185,000.00
Pass-Through Rate: 6.000%(1)
Date of Pooling and Servicing Agreement and Cut-off Date: Initial Certificate Principal Balance:
August 1, 2004
$0.00
First Distribution Date: September 27, 2004 Servicer: ▇▇▇▇▇▇ Loan Servicing LP
No. Trustee: U.S. Bank National Association
CUSIP: U5910E DX 9 Closing Date: September 9, 2004
ISIN: USU5910EDX95
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.
THIS CERTIFICATE DOES NOT REPRESENT AN OBLIGATION OF OR INTEREST IN
▇▇▇▇▇▇▇ ▇▇▇▇▇ MORTGAGE INVESTORS, INC., THE SERVICER, THE TRUSTEE OR ANY
OF THEIR AFFILIATES. THIS CERTIFICATE IS NOT GUARANTEED BY ANY AGENCY OR
INSTRUMENTALITY OF THE UNITED STATES.
This certifies that CEDE & CO. is the registered owner of a Percentage
Interest (obtained by dividing the Initial Certificate Principal Balance of this
Certificate by the Original Class Certificate Principal Balance of the Class B-4
Certificates) in that certain beneficial ownership
--------
(1) Subject to a cap as described in the Agreement.
B-4-2-3
interest evidenced by all the Class B-4 Certificates in the Trust Fund created
pursuant to a Pooling and Servicing Agreement, dated as specified above (the
"Agreement"), among ▇▇▇▇▇▇▇ ▇▇▇▇▇ Mortgage Investors, Inc. (hereinafter called
the "Depositor," which term includes any successor entity under the Agreement),
Credit-Based Asset Servicing and Securitization LLC (the "Seller"), the Servicer
and 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 Business Day immediately preceding such Distribution Date
(the "Record Date"), from funds in the Distribution Account 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 B-4 Certificates on
such Distribution Date pursuant to the Agreement provided, however, that if any
Class B-4 Certificate becomes a Definitive Certificate, the Record Date for such
Certificate will be the last Business Day of the month immediately preceding the
month in which the related Distribution Date occurs.
All distributions to the Holder of this Certificate under the Agreement
will be made or caused to be made by or on behalf of the Trustee by wire
transfer in immediately available funds to the account of the Person entitled
thereto if such Person shall have so notified the Certificate Registrar 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 B-4 Certificates
the aggregate Initial Certificate Principal Balance of which is in excess of
$5,000,000, or 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, provided that the Certificate Registrar may deduct a reasonable wire
transfer fee from any payment made by wire transfer. Notwithstanding the above,
the final distribution on this Certificate will be made after due notice by the
Trustee of the pendency of such distribution and only upon presentation and
surrender of this Certificate at the office or agency appointed by the Trustee
for that purpose as provided in the Agreement.
The Class B-4 Pass-Through Rate on each Distribution Date will be a rate
per annum equal to the least of (i) the Class B-4 Pass-Through Rate, (ii) the
Subordinate Rate Cap and (iii) the Subordinate Maximum Rate Cap.
This Certificate is one of a duly authorized issue of Certificates
designated as C-BASS Mortgage Loan Asset-Backed Certificates of the Series
specified on the face hereof (herein called the "Certificates") and representing
a Percentage Interest in the Class B-4 Certificates.
The Class B-4 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
B-4-2-4
expenses incurred, with respect to the Mortgage Loans.
This Certificate is subordinated in right of payment to the Class A, Class
M-1, Class M-2, Class M-3, Class B-1, Class B-2 and Class B-3 Certificates as
described in the Agreement.
The Agreement permits, with certain exceptions therein provided, the
amendment thereof and the modification of the rights and obligations of the
Depositor, the Servicer, the Trustee, the Seller and the rights of the
Certificateholders under the Agreement at any time by the Depositor, the
Servicer, the Seller and the Trustee with the consent of the Holders of
Certificates entitled to the Voting Rights identified in the Agreement. Any such
consent by the Holder of this Certificate shall be conclusive and binding on
such Holder and upon all future Holders of this Certificate and of any
Certificate issued upon the transfer hereof or in exchange 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 Trustee 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 Trustee and the Certificate
Registrar 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 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 that transfer is made
pursuant to an effective registration statement under the 1933 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 a transfer is to be made without registration or qualification
(i) the Certificateholder desiring to effect the transfer and such
Certificateholder's prospective transferee shall each execute a representation
letter in the form described by the Agreement certifying to the Certificate
Registrar the facts surrounding the transfer, and (ii) unless such transfer is
made in reliance upon Rule 144A under the 1933 Act, the Depositor and the
Certificate Registrar may require an Opinion of Counsel satisfactory to them
that such transfer may be made without such registration or qualification, which
Opinion of Counsel shall not be an expense of the Depositor, the Trustee or the
Certificate Registrar, in their respective capacities as such. None of the
Depositor, the Certificate Registrar or the Trustee is obligated to register or
qualify the Class of Certificates specified on the face hereof under the 1933
Act or any other securities law or to take any action not otherwise required
under the Agreement to permit the transfer of such Certificates without
registration or qualification. Any such
B-4-2-5
Certificateholder desiring to effect such transfer shall, and does hereby agree
to, indemnify the Trustee, the Depositor, the Certificate Registrar and the
Servicer 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. Each Person who
acquires this Certificate or an interest therein shall be deemed to have made
the representations required by the representation letter referred to in this
paragraph, unless such Person shall have provided such representation letter
referred to in this paragraph to the Certificate Registrar.
No service charge will be made for any such registration of transfer or
exchange of Certificates, but the Certificate Registrar 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 Servicer, the Trustee, any Paying Agent and the
Certificate Registrar and any agent of the Depositor, the Servicer, the Trustee,
any Paying Agent or the Certificate Registrar may treat the Person in whose name
this Certificate is registered as the owner hereof for all purposes, and none of
the Depositor, the Servicer, the Trustee, the Certificate Registrar, any Paying
Agent 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 or on behalf of the Trustee 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 the Trust Fund, and (ii) the purchase by the party designated in
the Agreement at a price determined as provided in the Agreement from the Trust
Fund of all 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 the Trust Fund all 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
Principal Balance of the Mortgage Loans at the time of purchase being 10% or
less of the Cut-off Date Aggregate Principal Balance.
The recitals contained herein shall be taken as statements of the
Depositor and the Trustee assumes no responsibility for their correctness.
Unless the certificate of authentication hereon has been executed by the
Certificate Registrar, by manual signature, this Certificate shall not be
entitled to any benefit under the Agreement or be valid for any purpose.
B-4-2-6
IN WITNESS WHEREOF, the Trustee has caused this Certificate to be duly
executed.
Dated: September 9, 2004
U.S. BANK NATIONAL ASSOCIATION,
as Trustee
By: _______________________________
Authorized Officer
CERTIFICATE OF AUTHENTICATION
This is one of the Certificates referred to in the within-mentioned
Agreement.
U.S. BANK NATIONAL ASSOCIATION,
as Certificate Registrar
By: _______________________________
Authorized Signatory
Date of authentication: September 9, 2004
B-4-2-7
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)
TEN ENT - as tenants by the entireties under Uniform
Gifts to Minors
JT TEN - as joint tenants with right of Act
survivorship and not as tenants
in common ______________
(State)
Additional abbreviations may also be used though not in the above list.
B-4-2-8
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
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 Certificate Registrar 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 ___________________________________________________, the assignee
named above, or __________________________________________________, as its
agent.
B-4-2-9
EXHIBIT C-1-1
FORM OF CLASS R CERTIFICATE
THIS CERTIFICATE MAY NOT BE TRANSFERRED TO A NON-UNITED STATES PERSON.
FOR U.S. FEDERAL INCOME TAX PURPOSES, THIS CERTIFICATE REPRESENTS THE
"RESIDUAL INTEREST" IN MULTIPLE "REAL ESTATE MORTGAGE INVESTMENT
CONDUITS," AS THOSE TERMS ARE DEFINED, RESPECTIVELY, IN SECTIONS 860G AND
860D OF THE INTERNAL REVENUE CODE OF 1986, AS AMENDED (THE "CODE").
THIS CLASS R CERTIFICATE IS SUBORDINATE TO THE OFFERED CERTIFICATES OF
THIS SERIES TO THE EXTENT DESCRIBED HEREIN AND IN THE AGREEMENT REFERRED
TO HEREIN.
THIS CLASS R CERTIFICATE WILL NOT BE ENTITLED TO PAYMENTS UNTIL SUCH TIME
AS DESCRIBED IN THE AGREEMENT REFERRED TO HEREIN.
THIS CLASS R CERTIFICATE HAS NOT BEEN REGISTERED OR QUALIFIED UNDER THE
SECURITIES ACT OF 1933, AS AMENDED (THE "1933 ACT"), OR THE SECURITIES
LAWS OF ANY STATE. ANY RESALE, TRANSFER OR OTHER DISPOSITION OF THIS
CERTIFICATE WITHOUT SUCH REGISTRATION OR QUALIFICATION MAY BE MADE ONLY IN
A TRANSACTION THAT DOES NOT REQUIRE SUCH REGISTRATION OR QUALIFICATION AND
IN ACCORDANCE WITH THE PROVISIONS OF SECTION 5.02 OF THE AGREEMENT
REFERRED TO HEREIN.
NO TRANSFER OF THIS CLASS R CERTIFICATE SHALL BE REGISTERED UNLESS THE
TRUSTEE AND THE CERTIFICATE REGISTRAR SHALL HAVE RECEIVED A REPRESENTATION
FROM THE TRANSFEREE OF THIS CERTIFICATE TO THE EFFECT THAT SUCH TRANSFEREE
IS NOT AN EMPLOYEE BENEFIT PLAN OR ARRANGEMENT SUBJECT TO TITLE I OF THE
EMPLOYEE RETIREMENT INCOME SECURITY ACT OF 1974, AS AMENDED ("ERISA"), A
PLAN SUBJECT TO SECTION 4975 OF THE CODE OR A PLAN SUBJECT TO STATE, LOCAL
OR OTHER FEDERAL LAW SUBSTANTIVELY SIMILAR TO THE FOREGOING PROVISIONS OF
ERISA OR THE CODE (COLLECTIVELY, A "PLAN"), AND IS NOT DIRECTLY OR
INDIRECTLY ACQUIRING THIS CERTIFICATE FOR, ON BEHALF OF OR WITH ANY ASSETS
OF ANY SUCH PLAN.
ANY RESALE, TRANSFER OR OTHER DISPOSITION OF THIS CLASS R CERTIFICATE MAY
BE MADE ONLY IF THE PROPOSED TRANSFEREE PROVIDES (1) AN AFFIDAVIT TO THE
CERTIFICATE
C-1-1-1
REGISTRAR THAT SUCH TRANSFEREE IS NOT (A) THE UNITED STATES, ANY STATE OR
POLITICAL SUBDIVISION THEREOF, ANY FOREIGN GOVERNMENT, ANY INTERNATIONAL
ORGANIZATION, OR ANY AGENCY OR INSTRUMENTALITY OF ANY OF THE FOREGOING,
(B) ANY ORGANIZATION (OTHER THAN A COOPERATIVE DESCRIBED IN SECTION 521 OF
THE CODE) WHICH IS EXEMPT FROM THE TAX IMPOSED BY CHAPTER 1 OF THE CODE
UNLESS SUCH ORGANIZATION IS SUBJECT TO THE TAX IMPOSED BY SECTION 511 OF
THE CODE, (C) ANY ORGANIZATION DESCRIBED IN SECTION 1381(A)(2)(C) OF THE
CODE (ANY SUCH PERSON DESCRIBED IN THE FOREGOING CLAUSES (A), (B) OR (C)
BEING HEREINAFTER REFERRED TO AS A "DISQUALIFIED ORGANIZATION"), OR (D) AN
AGENT OF A DISQUALIFIED ORGANIZATION AND (2) NO PURPOSE OF SUCH TRANSFER
IS TO IMPEDE THE ASSESSMENT OR COLLECTION OF TAX, AND (3) SUCH TRANSFEREE
SATISFIES CERTAIN ADDITIONAL CONDITIONS RELATING TO THE FINANCIAL
CONDITION OF THE PROPOSED TRANSFEREE. NOTWITHSTANDING THE REGISTRATION IN
THE CERTIFICATE REGISTER OR ANY TRANSFER, SALE OR OTHER DISPOSITION OF
THIS CLASS R 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 A
CLASS R CERTIFICATE BY ACCEPTANCE OF THIS CERTIFICATE SHALL BE DEEMED TO
HAVE CONSENTED TO THE PROVISIONS OF THIS PARAGRAPH AND THE PROVISIONS OF
SECTION 5.02(D) OF THE AGREEMENT REFERRED TO HEREIN. ANY PERSON THAT IS A
DISQUALIFIED ORGANIZATION IS PROHIBITED FROM ACQUIRING BENEFICIAL
OWNERSHIP OF THIS CLASS R CERTIFICATE.
C-1-1-2
C-BASS MORTGAGE LOAN ASSET-BACKED CERTIFICATES
SERIES 2004-CB6, CLASS R
evidencing a beneficial ownership interest in a portion of a Trust Fund
consisting primarily of a pool of conventional fixed-rate and adjustable-rate
one- to four-family first and second lien mortgage loans formed and sold by
▇▇▇▇▇▇▇ ▇▇▇▇▇ MORTGAGE INVESTORS, INC.
Series 2004-CB6, Class R Servicer: ▇▇▇▇▇▇ Loan Servicing LP
Date of Pooling and Servicing Agreement and Cut-off Date: Trustee: U.S. Bank National Association
August 1, 2004
First Distribution Date: September 27, 2004 Closing Date: September 9, 2004
No. CUSIP: 59020U JM 8
Percentage Interest: 100% ISIN: US59020UJM80
THIS CERTIFICATE DOES NOT REPRESENT AN OBLIGATION OF OR INTEREST IN
▇▇▇▇▇▇▇ ▇▇▇▇▇ MORTGAGE INVESTORS, INC., THE SERVICER, THE TRUSTEE OR ANY
OF THEIR AFFILIATES. THIS CERTIFICATE IS NOT GUARANTEED BY ANY AGENCY OR
INSTRUMENTALITY OF THE UNITED STATES.
This certifies that CMI Investors 2, LP is the registered owner of a
Percentage Interest set forth above in that certain beneficial ownership
interest evidenced by all the Class R Certificates in the Trust Fund created
pursuant to a Pooling and Servicing Agreement, dated as specified above (the
"Agreement"), among ▇▇▇▇▇▇▇ ▇▇▇▇▇ Mortgage Investors, Inc. (hereinafter called
the "Depositor," which term includes any successor entity under the Agreement),
Credit-Based Asset Servicing and Securitization LLC (the "Seller"), the Servicer
and 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 last Business Day of the month immediately preceding the
month in which the related Distribution Date occurs (the "Record Date"), from
funds in the Distribution Account 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 or on behalf of the Trustee by wire
transfer in immediately available funds
C-1-1-3
to the account of the Person entitled thereto if such Person shall have so
notified the Certificate Registrar 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 the aggregate Percentage Interest of
which is in excess of a 66% Percentage Interest of the Class R Certificates, or
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,
provided that the Certificate Registrar may deduct a reasonable wire transfer
fee from any payment made by wire transfer. Notwithstanding the above, the final
distribution on this Certificate will be made after due notice by the Trustee of
the pendency of such distribution and only upon presentation and surrender of
this Certificate at the office or agency appointed by the Trustee for that
purpose as provided in the Agreement.
This Certificate is one of a duly authorized issue of Certificates
designated as C-BASS Mortgage Loan Asset-Backed Certificates of the Series
specified on the face hereof (herein called the "Certificates") and representing
the Percentage Interest specified on the face hereof.
The Class R 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 Servicer, the Trustee, the Seller and the rights of the
Certificateholders under the Agreement at any time by the Depositor, the
Servicer, the Seller and the Trustee with the consent of the Holders of
Certificates entitled to the Voting Rights identified in the Agreement. Any such
consent by the Holder of this Certificate shall be conclusive and binding on
such Holder and upon all future Holders of this Certificate and of any
Certificate issued upon the transfer hereof or in exchange 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 Trustee 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 Trustee and the Certificate
Registrar 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
C-1-1-4
Percentage Interest, as requested by the Holder surrendering the same.
No transfer of this Certificate shall be made unless that transfer is made
pursuant to an effective registration statement under the 1933 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 a transfer is to be made without registration or qualification
(i) the Certificateholder desiring to effect the transfer and such
Certificateholder's prospective transferee shall each execute a representation
letter in the form described by the Agreement certifying to the Certificate
Registrar the facts surrounding the transfer, and (ii) unless such transfer is
made in reliance upon Rule 144A under the 1933 Act, the Depositor and the
Certificate Registrar may require an Opinion of Counsel satisfactory to them
that such transfer may be made without such registration or qualification, which
Opinion of Counsel shall not be an expense of the Depositor, the Trustee or the
Certificate Registrar, in their respective capacities as such. None of the
Depositor, the Certificate Registrar or the Trustee is obligated to register or
qualify the Class of Certificates specified on the face hereof under the 1933
Act or any other securities law or to take any action not otherwise required
under the Agreement to permit the transfer of such Certificates without
registration or qualification. Any such Certificateholder desiring to effect
such transfer shall, and does hereby agree to, indemnify the Trustee, the
Depositor, the Certificate Registrar and the Servicer 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 a Certificate or any interest therein may be made to
employee benefit plans and certain other retirement plans and arrangements,
including individual retirement accounts and annuities, ▇▇▇▇▇ plans and
collective investment funds and separate accounts in which such plans, accounts
or arrangements are invested that are subject to the fiduciary responsibility
provisions of ERISA and Section 4975 of the Code ("Plans") or any person who is
directly or indirectly purchasing the Certificate or interest therein on behalf
of, as named fiduciary of, as trustee of, or with assets of a Plan.
The Holder of this Certificate, by its acceptance hereof, shall be deemed
for all purposes to have consented to the provisions of Section 5.02 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 REMIC
provided for in the Trust Agreement to cease to qualify as a REMIC or cause the
imposition of a tax upon the Trust.
No service charge will be made for any such registration of transfer or
exchange of Certificates, but the Certificate Registrar 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 Servicer, the Trustee, any Paying Agent and the
Certificate Registrar and any agent of the Depositor, the Servicer, the Trustee,
any Paying Agent or the Certificate Registrar may treat the Person in whose name
this Certificate is registered as the owner hereof for all purposes, and none of
the Depositor, the Servicer, the Trustee, the Certificate Registrar, any Paying
Agent nor any such agent shall be affected by notice to the contrary.
C-1-1-5
The obligations created by the Agreement and the Trust Fund created
thereby shall terminate upon payment to the Certificateholders of all amounts
held by or on behalf of the Trustee 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 the Trust Fund, and (ii) the purchase by the party designated in
the Agreement at a price determined as provided in the Agreement from the Trust
Fund of all 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 the Trust Fund all 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
Principal Balance of the Mortgage Loans at the time of purchase being 10% or
less of the Cut-off Date Aggregate Principal Balance.
The recitals contained herein shall be taken as statements of the
Depositor and the Trustee assumes no responsibility for their correctness.
Unless the certificate of authentication hereon has been executed by the
Certificate Registrar, by manual signature, this Certificate shall not be
entitled to any benefit under the Agreement or be valid for any purpose.
C-1-1-6
IN WITNESS WHEREOF, the Trustee has caused this Certificate to be duly
executed.
Dated: September 9, 2004
U.S. BANK NATIONAL ASSOCIATION,
as Trustee
By: _______________________________
Authorized Officer
CERTIFICATE OF AUTHENTICATION
This is one of the Certificates referred to in the within-mentioned
Agreement.
U.S. BANK NATIONAL ASSOCIATION,
as Certificate Registrar
By: _______________________________
Authorized Signatory
Date of authentication: September 9, 2004
C-1-1-7
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)
TEN ENT - as tenants by the entireties under Uniform
Gifts to Minors Act
JT TEN - as joint tenants with right of
survivorship and not as tenants
in common ______________________
(State)
Additional abbreviations may also be used though not in the above list.
C-1-1-8
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
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 Certificate Registrar 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 ___________________________________________________, the assignee
named above, or __________________________________________________, as its
agent.
C-1-1-9
EXHIBIT C-1-2
FORM OF CLASS R-X CERTIFICATE
THIS CERTIFICATE MAY NOT BE TRANSFERRED TO A NON-UNITED STATES PERSON.
FOR U.S. FEDERAL INCOME TAX PURPOSES, THIS CERTIFICATE REPRESENTS THE
"RESIDUAL INTEREST" IN MULTIPLE "REAL ESTATE MORTGAGE INVESTMENT
CONDUITS," AS THOSE TERMS ARE DEFINED, RESPECTIVELY, IN SECTIONS 860G AND
860D OF THE INTERNAL REVENUE CODE OF 1986, AS AMENDED (THE "CODE").
THIS CLASS R-X CERTIFICATE IS SUBORDINATE TO THE OFFERED CERTIFICATES OF
THIS SERIES TO THE EXTENT DESCRIBED HEREIN AND IN THE AGREEMENT REFERRED
TO HEREIN.
THIS CLASS R-X CERTIFICATE WILL NOT BE ENTITLED TO PAYMENTS UNTIL SUCH
TIME AS DESCRIBED IN THE AGREEMENT REFERRED TO HEREIN.
THIS CLASS R-X CERTIFICATE HAS NOT BEEN REGISTERED OR QUALIFIED UNDER THE
SECURITIES ACT OF 1933, AS AMENDED (THE "1933 ACT"), OR THE SECURITIES
LAWS OF ANY STATE. ANY RESALE, TRANSFER OR OTHER DISPOSITION OF THIS
CERTIFICATE WITHOUT SUCH REGISTRATION OR QUALIFICATION MAY BE MADE ONLY IN
A TRANSACTION THAT DOES NOT REQUIRE SUCH REGISTRATION OR QUALIFICATION AND
IN ACCORDANCE WITH THE PROVISIONS OF SECTION 5.02 OF THE AGREEMENT
REFERRED TO HEREIN.
NO TRANSFER OF THIS CLASS R-X CERTIFICATE SHALL BE REGISTERED UNLESS THE
TRUSTEE AND THE CERTIFICATE REGISTRAR SHALL HAVE RECEIVED A REPRESENTATION
FROM THE TRANSFEREE OF THIS CERTIFICATE TO THE EFFECT THAT SUCH TRANSFEREE
IS NOT AN EMPLOYEE BENEFIT PLAN OR ARRANGEMENT SUBJECT TO TITLE I OF THE
EMPLOYEE RETIREMENT INCOME SECURITY ACT OF 1974, AS AMENDED ("ERISA"), A
PLAN SUBJECT TO SECTION 4975 OF THE CODE OR A PLAN SUBJECT TO STATE, LOCAL
OR OTHER FEDERAL LAW SUBSTANTIVELY SIMILAR TO THE FOREGOING PROVISIONS OF
ERISA OR THE CODE (COLLECTIVELY, A "PLAN"), AND IS NOT DIRECTLY OR
INDIRECTLY ACQUIRING THIS CERTIFICATE FOR, ON BEHALF OF OR WITH ANY ASSETS
OF ANY SUCH PLAN.
ANY RESALE, TRANSFER OR OTHER DISPOSITION OF THIS CLASS R-X CERTIFICATE
MAY BE MADE ONLY IF THE PROPOSED TRANSFEREE PROVIDES (1) AN AFFIDAVIT TO
THE CERTIFICATE
C-1-2-1
REGISTRAR THAT SUCH TRANSFEREE IS NOT (A) THE UNITED STATES, ANY STATE OR
POLITICAL SUBDIVISION THEREOF, ANY FOREIGN GOVERNMENT, ANY INTERNATIONAL
ORGANIZATION, OR ANY AGENCY OR INSTRUMENTALITY OF ANY OF THE FOREGOING,
(B) ANY ORGANIZATION (OTHER THAN A COOPERATIVE DESCRIBED IN SECTION 521 OF
THE CODE) WHICH IS EXEMPT FROM THE TAX IMPOSED BY CHAPTER 1 OF THE CODE
UNLESS SUCH ORGANIZATION IS SUBJECT TO THE TAX IMPOSED BY SECTION 511 OF
THE CODE, (C) ANY ORGANIZATION DESCRIBED IN SECTION 1381(A)(2)(C) OF THE
CODE (ANY SUCH PERSON DESCRIBED IN THE FOREGOING CLAUSES (A), (B) OR (C)
BEING HEREINAFTER REFERRED TO AS A "DISQUALIFIED ORGANIZATION"), OR (D) AN
AGENT OF A DISQUALIFIED ORGANIZATION AND (2) NO PURPOSE OF SUCH TRANSFER
IS TO IMPEDE THE ASSESSMENT OR COLLECTION OF TAX, AND (3) SUCH TRANSFEREE
SATISFIES CERTAIN ADDITIONAL CONDITIONS RELATING TO THE FINANCIAL
CONDITION OF THE PROPOSED TRANSFEREE. NOTWITHSTANDING THE REGISTRATION IN
THE CERTIFICATE REGISTER OR ANY TRANSFER, SALE OR OTHER DISPOSITION OF
THIS CLASS R-X 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 A
CLASS R-X CERTIFICATE BY ACCEPTANCE OF THIS CERTIFICATE SHALL BE DEEMED TO
HAVE CONSENTED TO THE PROVISIONS OF THIS PARAGRAPH AND THE PROVISIONS OF
SECTION 5.02(D) OF THE AGREEMENT REFERRED TO HEREIN. ANY PERSON THAT IS A
DISQUALIFIED ORGANIZATION IS PROHIBITED FROM ACQUIRING BENEFICIAL
OWNERSHIP OF THIS CLASS R-X CERTIFICATE.
C-1-2-2
C-BASS MORTGAGE LOAN ASSET-BACKED CERTIFICATES
SERIES 2004-CB6, CLASS R-X
evidencing a beneficial ownership interest in a portion of a Trust Fund
consisting primarily of a pool of conventional fixed-rate and adjustable-rate
one- to four-family first and second lien mortgage loans formed and sold by
▇▇▇▇▇▇▇ ▇▇▇▇▇ MORTGAGE INVESTORS, INC.
Series 2004-CB6, Class R-X Servicer: ▇▇▇▇▇▇ Loan Servicing LP
Date of Pooling and Servicing Agreement Trustee: U.S. Bank National Association
and Cut-off Date: August 1, 2004
First Distribution Date: September 27, 2004 Closing Date: September 9, 2004
No. CUSIP: 59020U JN 6
Percentage Interest: 100% ISIN: US59020UJN63
THIS CERTIFICATE DOES NOT REPRESENT AN OBLIGATION OF OR INTEREST IN
▇▇▇▇▇▇▇ ▇▇▇▇▇ MORTGAGE INVESTORS, INC., THE SERVICER, THE TRUSTEE OR ANY
OF THEIR AFFILIATES. THIS CERTIFICATE IS NOT GUARANTEED BY ANY AGENCY OR
INSTRUMENTALITY OF THE UNITED STATES.
This certifies that ▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇▇ is the registered owner of a
Percentage Interest set forth above in that certain beneficial ownership
interest evidenced by all the Class R-X Certificates in the Trust Fund created
pursuant to a Pooling and Servicing Agreement, dated as specified above (the
"Agreement"), among ▇▇▇▇▇▇▇ ▇▇▇▇▇ Mortgage Investors, Inc. (hereinafter called
the "Depositor," which term includes any successor entity under the Agreement),
Credit-Based Asset Servicing and Securitization LLC (the "Seller"), the Servicer
and 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 last Business Day of the month immediately preceding the
month in which the related Distribution Date occurs (the "Record Date"), from
funds in the Distribution Account 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-X 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 or on behalf of the Trustee by wire
transfer in immediately available funds
C-1-2-3
to the account of the Person entitled thereto if such Person shall have so
notified the Certificate Registrar 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-X Certificates the aggregate Percentage Interest of
which is in excess of a 66% Percentage Interest of the Class R-X Certificates,
or 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,
provided that the Certificate Registrar may deduct a reasonable wire transfer
fee from any payment made by wire transfer. Notwithstanding the above, the final
distribution on this Certificate will be made after due notice by the Trustee of
the pendency of such distribution and only upon presentation and surrender of
this Certificate at the office or agency appointed by the Trustee for that
purpose as provided in the Agreement.
This Certificate is one of a duly authorized issue of Certificates
designated as C-BASS Mortgage Loan Asset-Backed Certificates of the Series
specified on the face hereof (herein called the "Certificates") and representing
the Percentage Interest specified on the face hereof.
The Class R-X 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 Servicer, the Trustee, the Seller and the rights of the
Certificateholders under the Agreement at any time by the Depositor, the
Servicer, the Seller and the Trustee with the consent of the Holders of
Certificates entitled to the Voting Rights identified in the Agreement. Any such
consent by the Holder of this Certificate shall be conclusive and binding on
such Holder and upon all future Holders of this Certificate and of any
Certificate issued upon the transfer hereof or in exchange 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 Trustee 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 Trustee and the Certificate
Registrar 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
C-1-2-4
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 that transfer is made
pursuant to an effective registration statement under the 1933 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 a transfer is to be made without registration or qualification
(i) the Certificateholder desiring to effect the transfer and such
Certificateholder's prospective transferee shall each execute a representation
letter in the form described by the Agreement certifying to the Certificate
Registrar the facts surrounding the transfer, and (ii) unless such transfer is
made in reliance upon Rule 144A under the 1933 Act, the Depositor and the
Certificate Registrar may require an Opinion of Counsel satisfactory to them
that such transfer may be made without such registration or qualification, which
Opinion of Counsel shall not be an expense of the Depositor, the Trustee or the
Certificate Registrar, in their respective capacities as such. None of the
Depositor, the Certificate Registrar or the Trustee is obligated to register or
qualify the Class of Certificates specified on the face hereof under the 1933
Act or any other securities law or to take any action not otherwise required
under the Agreement to permit the transfer of such Certificates without
registration or qualification. Any such Certificateholder desiring to effect
such transfer shall, and does hereby agree to, indemnify the Trustee, the
Depositor, the Certificate Registrar and the Servicer 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 a Certificate or any interest therein may be made to
employee benefit plans and certain other retirement plans and arrangements,
including individual retirement accounts and annuities, ▇▇▇▇▇ plans and
collective investment funds and separate accounts in which such plans, accounts
or arrangements are invested that are subject to the fiduciary responsibility
provisions of ERISA and Section 4975 of the Code ("Plans") or any person who is
directly or indirectly purchasing the Certificate or interest therein on behalf
of, as named fiduciary of, as trustee of, or with assets of a Plan.
The Holder of this Certificate, by its acceptance hereof, shall be deemed
for all purposes to have consented to the provisions of Section 5.02 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 REMIC
provided for in the Trust Agreement to cease to qualify as a REMIC or cause the
imposition of a tax upon the Trust.
No service charge will be made for any such registration of transfer or
exchange of Certificates, but the Certificate Registrar 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 Servicer, the Trustee, any Paying Agent and the
Certificate Registrar and any agent of the Depositor, the Servicer, the Trustee,
any Paying Agent or the Certificate Registrar may treat the Person in whose name
this Certificate is registered as the owner hereof
C-1-2-5
for all purposes, and none of the Depositor, the Servicer, the Trustee, the
Certificate Registrar, any Paying Agent 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 or on behalf of the Trustee 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 the Trust Fund, and (ii) the purchase by the party designated in
the Agreement at a price determined as provided in the Agreement from the Trust
Fund of all 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 the Trust Fund all 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
Principal Balance of the Mortgage Loans at the time of purchase being 10% or
less of the Cut-off Date Aggregate Principal Balance.
The recitals contained herein shall be taken as statements of the
Depositor and the Trustee assumes no responsibility for their correctness.
Unless the certificate of authentication hereon has been executed by the
Certificate Registrar, by manual signature, this Certificate shall not be
entitled to any benefit under the Agreement or be valid for any purpose.
C-1-2-6
IN WITNESS WHEREOF, the Trustee has caused this Certificate to be duly
executed.
Dated: September 9, 2004
U.S. BANK NATIONAL ASSOCIATION,
as Trustee
By:_____________________________________
Authorized Officer
CERTIFICATE OF AUTHENTICATION
This is one of the Certificates referred to in the within-mentioned
Agreement.
U.S. BANK NATIONAL ASSOCIATION,
as Certificate Registrar
By:_____________________________________
Authorized Officer
Date of authentication: September 9, 2004
C-1-2-7
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
---------
TEN ENT - as tenants by the entireties (Cust) (Minor)
under Uniform
JT TEN - as joint tenants with right of Gifts to Minors
survivorship and not as tenants Act
in common _______________
(State)
Additional abbreviations may also be used though not in the above list.
C-1-2-8
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
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 Certificate Registrar 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 _______________________________________________,
the assignee named above, or __________________________________________________,
as its agent.
C-1-2-9
EXHIBIT C-2
FORM OF CLASS M-1 CERTIFICATE
UNLESS THIS CERTIFICATE IS PRESENTED BY AN AUTHORIZED REPRESENTATIVE OF
THE DEPOSITORY TRUST COMPANY, A NEW YORK CORPORATION ("DTC"), TO THE
TRUSTEE OR ITS AGENT FOR REGISTRATION OF TRANSFER, EXCHANGE, OR PAYMENT,
AND ANY CERTIFICATE ISSUED IS REGISTERED IN THE NAME OF CEDE & CO. OR IN
SUCH OTHER NAME AS IS REQUESTED BY AN AUTHORIZED REPRESENTATIVE OF DTC
(AND ANY PAYMENT IS MADE TO CEDE & CO. OR TO SUCH OTHER ENTITY AS IS
REQUESTED BY AN AUTHORIZED REPRESENTATIVE OF DTC), ANY TRANSFER, PLEDGE,
OR OTHER USE HEREOF FOR VALUE OR OTHERWISE BY OR TO ANY PERSON IS WRONGFUL
INASMUCH AS THE REGISTERED OWNER HEREOF, CEDE & CO., HAS AN INTEREST
HEREIN.
THIS CERTIFICATE IS SUBORDINATED IN RIGHT OF PAYMENT TO THE CLASS A
CERTIFICATES AS DESCRIBED IN THE AGREEMENT REFERRED TO HEREIN.
EXCEPT AS PROVIDED IN SECTION 5.02(D) OF THE AGREEMENT REFERRED TO HEREIN,
NO TRANSFER OF THIS CERTIFICATE SHALL BE REGISTERED UNLESS THE TRUSTEE AND
THE CERTIFICATE REGISTRAR SHALL HAVE RECEIVED (A) A REPRESENTATION FROM
THE TRANSFEREE OF THIS CERTIFICATE TO THE EFFECT THAT SUCH TRANSFEREE IS
NOT AN EMPLOYEE BENEFIT PLAN OR ARRANGEMENT SUBJECT TO TITLE I OF THE
EMPLOYEE RETIREMENT INCOME SECURITY ACT OF 1974, AS AMENDED ("ERISA"), A
PLAN SUBJECT TO SECTION 4975 OF THE INTERNAL REVENUE CODE OF 1986, AS
AMENDED (THE "CODE") OR A PLAN SUBJECT TO STATE, LOCAL OR OTHER FEDERAL
LAW SUBSTANTIVELY SIMILAR TO THE FOREGOING PROVISIONS OF ERISA OR THE CODE
("SIMILAR LAW") (COLLECTIVELY, A "PLAN"), AND IS NOT DIRECTLY OR
INDIRECTLY ACQUIRING THIS CERTIFICATE FOR, ON BEHALF OF OR WITH ANY ASSETS
OF ANY SUCH PLAN, (B) A REPRESENTATION THAT THE TRANSFEREE IS AN INSURANCE
COMPANY THAT IS ACQUIRING THE CERTIFICATE WITH ASSETS OF AN "INSURANCE
COMPANY GENERAL ACCOUNT" AS DEFINED IN SECTION V(E) OF PROHIBITED
TRANSACTION CLASS EXEMPTION ("PTCE") 95-60, OR (C) SOLELY IN THE CASE OF A
DEFINITIVE CERTIFICATE, AN OPINION OF COUNSEL SATISFACTORY TO THE TRUSTEE
AND THE CERTIFICATE REGISTRAR, AND UPON WHICH THE TRUSTEE AND THE
CERTIFICATE REGISTRAR SHALL BE ENTITLED TO RELY, TO THE
C-2-1
EFFECT THAT THE ACQUISITION AND HOLDING OF THIS CERTIFICATE BY THE
TRANSFEREE WILL NOT RESULT IN A NONEXEMPT PROHIBITED TRANSACTION UNDER
TITLE I OF ERISA OR SECTION 4975 OF THE CODE, OR A VIOLATION OF SIMILAR
LAW, AND WILL NOT SUBJECT THE CERTIFICATE REGISTRAR, THE DEPOSITOR, THE
SERVICER OR THE TRUSTEE TO ANY OBLIGATION IN ADDITION TO THOSE UNDERTAKEN
BY SUCH ENTITIES IN THE AGREEMENT REFERRED TO HEREIN, WHICH OPINION OF
COUNSEL SHALL NOT BE AN EXPENSE OF THE CERTIFICATE REGISTRAR, THE
DEPOSITOR, THE SERVICER OR THE TRUSTEE.
FOR U.S. FEDERAL INCOME TAX PURPOSES, THIS CERTIFICATE REPRESENTS
BENEFICIAL OWNERSHIP OF A "REGULAR INTEREST" IN A "REAL ESTATE MORTGAGE
INVESTMENT CONDUIT," AS THOSE TERMS ARE DEFINED, RESPECTIVELY, IN SECTIONS
860G AND 860D OF THE CODE AND CERTAIN OTHER PROPERTY.
C-2-2
C-BASS MORTGAGE LOAN ASSET-BACKED CERTIFICATES
SERIES 2004-CB6, CLASS M-1
evidencing a beneficial ownership interest in a portion of a Trust Fund
consisting primarily of a pool of conventional fixed-rate and adjustable-rate
one- to four-family first and second lien mortgage loans formed and sold by
▇▇▇▇▇▇▇ ▇▇▇▇▇ MORTGAGE INVESTORS, INC.
Series 2004-CB6, Class M-1 Original Class Certificate Principal Balance of the
Class M-1 Certificates as of the Closing
Date: $22,964,000.00
Pass-Through Rate: Variable (1)
Date of Pooling and Servicing Agreement and Initial Certificate Principal Balance: $22,964,000.00
Cut-off Date: August 1, 2004
First Distribution Date: September 27, 2004 Servicer: ▇▇▇▇▇▇ Loan Servicing LP
No. Trustee: U.S. Bank National Association
CUSIP: 59020U JC 0 Closing Date: September 9, 2004
ISIN: US59020UJC09
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.
THIS CERTIFICATE DOES NOT REPRESENT AN OBLIGATION OF OR INTEREST IN
▇▇▇▇▇▇▇ ▇▇▇▇▇ MORTGAGE INVESTORS, INC., THE SERVICER, THE TRUSTEE OR ANY
OF THEIR AFFILIATES. THIS CERTIFICATE IS NOT GUARANTEED BY ANY AGENCY OR
INSTRUMENTALITY OF THE UNITED STATES.
This certifies that CEDE & CO. is the registered owner of a Percentage
Interest (obtained by dividing the Initial Certificate Principal Balance of this
Certificate by the Original Class Certificate Principal Balance of the Class M-1
Certificates) in that certain beneficial ownership interest evidenced by all the
Class M-1 Certificates in the Trust Fund created pursuant to a Pooling and
Servicing Agreement, dated as specified above (the "Agreement"), among ▇▇▇▇▇▇▇
▇▇▇▇▇ Mortgage Investors, Inc. (hereinafter called the "Depositor," which term
includes any successor entity under the Agreement), Credit-Based Asset Servicing
and Securitization LLC (the "Seller"), the Servicer and 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
------------------------
(1) Subject to a cap as described in the Agreement.
C-2-3
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 last Business Day of the month immediately preceding the
month in which the related Distribution Date occurs (the "Record Date"), from
funds in the Distribution Account 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 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 or on behalf of the Trustee by wire
transfer in immediately available funds to the account of the Person entitled
thereto if such Person shall have so notified the Certificate Registrar 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 Certificates
the aggregate Initial Certificate Principal Balance of which is in excess of
$5,000,000, or 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, provided that the Certificate Registrar may deduct a reasonable wire
transfer fee from any payment made by wire transfer. Notwithstanding the above,
the final distribution on this Certificate will be made after due notice by the
Trustee of the pendency of such distribution and only upon presentation and
surrender of this Certificate at the office or agency appointed by the Trustee
for that purpose as provided in the Agreement.
The Class M-1 Pass-Through Rate on each Distribution Date will be a rate
per annum equal to the least of (i) LIBOR as of the related LIBOR Determination
Date, plus the Class M-1 Certificate Margin, (ii) the Subordinate Rate Cap and
(iii) the Subordinate Maximum Rate Cap.
This Certificate is one of a duly authorized issue of Certificates
designated as C-BASS Mortgage Loan Asset-Backed Certificates of the Series
specified on the face hereof (herein called the "Certificates") and representing
a Percentage Interest in the Class M-1 Certificates.
The Class M-1 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.
This Certificate is subordinated in right of payment to the Class A
Certificates as described in the Agreement.
The Agreement permits, with certain exceptions therein provided, the
amendment thereof and the modification of the rights and obligations of the
Depositor, the Servicer, the Trustee, the Seller and the rights of the
Certificateholders under the Agreement at any time by the Depositor, the
Servicer, the Seller and the Trustee with the consent of the Holders of
Certificates entitled to
C-2-4
the Voting Rights identified in the Agreement. Any such consent by the Holder of
this Certificate shall be conclusive and binding on such Holder and upon all
future Holders of this Certificate and of any Certificate issued upon the
transfer hereof or in exchange 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 Trustee 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 Trustee and the Certificate
Registrar 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 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 service charge will be made for any such registration of transfer or
exchange of Certificates, but the Certificate Registrar 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 Servicer, the Trustee, any Paying Agent and the
Certificate Registrar and any agent of the Depositor, the Servicer, the Trustee,
any Paying Agent or the Certificate Registrar may treat the Person in whose name
this Certificate is registered as the owner hereof for all purposes, and none of
the Depositor, the Servicer, the Trustee, the Certificate Registrar, any Paying
Agent 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 or on behalf of the Trustee 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 the Trust Fund, and (ii) the purchase by the party designated in
the Agreement at a price determined as provided in the Agreement from the Trust
Fund of all 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 the Trust Fund all 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
Principal Balance of the Mortgage Loans at the time of purchase being 10% or
less of the Cut-off Date Aggregate Principal Balance.
C-2-5
The recitals contained herein shall be taken as statements of the
Depositor and the Trustee assumes no responsibility for their correctness.
Unless the certificate of authentication hereon has been executed by the
Certificate Registrar, by manual signature, this Certificate shall not be
entitled to any benefit under the Agreement or be valid for any purpose.
C-2-6
IN WITNESS WHEREOF, the Trustee has caused this Certificate to be duly
executed.
Dated: September 9, 2004
U.S. BANK NATIONAL ASSOCIATION,
as Trustee
By:___________________________________
Authorized Officer
CERTIFICATE OF AUTHENTICATION
This is one of the Certificates referred to in the within-mentioned
Agreement.
U.S. BANK NATIONAL ASSOCIATION, as
Certificate Registrar
By:___________________________________
Authorized Officer
Date of authentication: September 9, 2004
C-2-7
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)
TEN ENT - as tenants by the entireties under Uniform
Gifts to Minors
JT TEN - as joint tenants with right of Act
survivorship and not as
tenants in common _______________
(State)
Additional abbreviations may also be used though not in the above list.
C-2-8
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
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 Certificate Registrar 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 _______________________________________________,
the assignee named above, or __________________________________________________,
as its agent.
C-2-9
EXHIBIT C-3
FORM OF CLASS M-2 CERTIFICATE
UNLESS THIS CERTIFICATE IS PRESENTED BY AN AUTHORIZED REPRESENTATIVE OF
THE DEPOSITORY TRUST COMPANY, A NEW YORK CORPORATION ("DTC"), TO THE
TRUSTEE OR ITS AGENT FOR REGISTRATION OF TRANSFER, EXCHANGE, OR PAYMENT,
AND ANY CERTIFICATE ISSUED IS REGISTERED IN THE NAME OF CEDE & CO. OR IN
SUCH OTHER NAME AS IS REQUESTED BY AN AUTHORIZED REPRESENTATIVE OF DTC
(AND ANY PAYMENT IS MADE TO CEDE & CO. OR TO SUCH OTHER ENTITY AS IS
REQUESTED BY AN AUTHORIZED REPRESENTATIVE OF DTC), ANY TRANSFER, PLEDGE,
OR OTHER USE HEREOF FOR VALUE OR OTHERWISE BY OR TO ANY PERSON IS WRONGFUL
INASMUCH AS THE REGISTERED OWNER HEREOF, CEDE & CO., HAS AN INTEREST
HEREIN.
THIS CERTIFICATE IS SUBORDINATED IN RIGHT OF PAYMENT TO THE CLASS A AND
CLASS M-1 CERTIFICATES AS DESCRIBED IN THE AGREEMENT REFERRED TO HEREIN.
EXCEPT AS PROVIDED IN SECTION 5.02(D) OF THE AGREEMENT REFERRED TO HEREIN,
NO TRANSFER OF THIS CERTIFICATE SHALL BE REGISTERED UNLESS THE TRUSTEE AND
THE CERTIFICATE REGISTRAR SHALL HAVE RECEIVED (A) A REPRESENTATION FROM
THE TRANSFEREE OF THIS CERTIFICATE TO THE EFFECT THAT SUCH TRANSFEREE IS
NOT AN EMPLOYEE BENEFIT PLAN OR ARRANGEMENT SUBJECT TO TITLE I OF THE
EMPLOYEE RETIREMENT INCOME SECURITY ACT OF 1974, AS AMENDED ("ERISA"), A
PLAN SUBJECT TO SECTION 4975 OF THE INTERNAL REVENUE CODE OF 1986, AS
AMENDED (THE "CODE") OR A PLAN SUBJECT TO STATE, LOCAL OR OTHER FEDERAL
LAW SUBSTANTIVELY SIMILAR TO THE FOREGOING PROVISIONS OF ERISA OR THE CODE
("SIMILAR LAW") (COLLECTIVELY, A "PLAN"), AND IS NOT DIRECTLY OR
INDIRECTLY ACQUIRING THIS CERTIFICATE FOR, ON BEHALF OF OR WITH ANY ASSETS
OF ANY SUCH PLAN, (B) A REPRESENTATION THAT THE TRANSFEREE IS AN INSURANCE
COMPANY THAT IS ACQUIRING THE CERTIFICATE WITH ASSETS OF AN "INSURANCE
COMPANY GENERAL ACCOUNT" AS DEFINED IN SECTION V(E) OF PROHIBITED
TRANSACTION CLASS EXEMPTION ("PTCE") 95-60, OR (C) SOLELY IN THE CASE OF A
DEFINITIVE CERTIFICATE, AN OPINION OF COUNSEL SATISFACTORY TO THE TRUSTEE
AND THE CERTIFICATE REGISTRAR, AND UPON WHICH THE TRUSTEE AND THE
CERTIFICATE REGISTRAR SHALL BE ENTITLED TO RELY, TO THE
C-3-1
EFFECT THAT THE ACQUISITION AND HOLDING OF THIS CERTIFICATE BY THE
TRANSFEREE WILL NOT RESULT IN A NONEXEMPT PROHIBITED TRANSACTION UNDER
TITLE I OF ERISA OR SECTION 4975 OF THE CODE, OR A VIOLATION OF SIMILAR
LAW, AND WILL NOT SUBJECT THE CERTIFICATE REGISTRAR, THE DEPOSITOR, THE
SERVICER OR THE TRUSTEE TO ANY OBLIGATION IN ADDITION TO THOSE UNDERTAKEN
BY SUCH ENTITIES IN THE AGREEMENT REFERRED TO HEREIN, WHICH OPINION OF
COUNSEL SHALL NOT BE AN EXPENSE OF THE CERTIFICATE REGISTRAR, THE
DEPOSITOR, THE SERVICER OR THE TRUSTEE.
FOR U.S. FEDERAL INCOME TAX PURPOSES, THIS CERTIFICATE REPRESENTS
BENEFICIAL OWNERSHIP OF A "REGULAR INTEREST" IN A "REAL ESTATE MORTGAGE
INVESTMENT CONDUIT," AS THOSE TERMS ARE DEFINED, RESPECTIVELY, IN SECTIONS
860G AND 860D OF THE CODE AND CERTAIN OTHER PROPERTY.
C-BASS MORTGAGE LOAN ASSET-BACKED CERTIFICATES
SERIES 2004-CB6, CLASS M-2
evidencing a beneficial ownership interest in a portion of a Trust Fund
consisting primarily of a pool of conventional fixed-rate and adjustable-rate
one- to four-family first and second lien mortgage loans formed and sold by
▇▇▇▇▇▇▇ ▇▇▇▇▇ MORTGAGE INVESTORS, INC.
Series 2004-CB6, Class M-2 Original Class Certificate Principal Balance of the
Class M-2 Certificates as of the
Closing Date: $19,519,000.00
Pass-Through Rate: Variable (1)
Date of Pooling and Servicing Agreement and Initial Certificate Principal Balance: $19,519,000.00
Cut-off Date: August 1, 2004
First Distribution Date: September 27, 2004 Servicer: ▇▇▇▇▇▇ Loan Servicing LP
No. Trustee: U.S. Bank National Association
CUSIP: 59020U JD 8 Closing Date: September 9, 2004
ISIN: US59020UJD81
DISTRIBUTIONS IN REDUCTION OF THE CERTIFICATE PRINCIPAL BALANCE OF THIS
CERTIFICATE MAY BE MADE MONTHLY AS SET FORTH HEREIN. ACCORDINGLY, THE
OUTSTANDING
------------------------
(1) Subject to a cap as described in the Agreement.
C-3-2
CERTIFICATE PRINCIPAL BALANCE HEREOF AT ANY TIME MAY BE LESS THAN THE
AMOUNT SHOWN ABOVE.
THIS CERTIFICATE DOES NOT REPRESENT AN OBLIGATION OF OR INTEREST IN
▇▇▇▇▇▇▇ ▇▇▇▇▇ MORTGAGE INVESTORS, INC., THE SERVICER, THE TRUSTEE OR ANY
OF THEIR AFFILIATES. THIS CERTIFICATE IS NOT GUARANTEED BY ANY AGENCY OR
INSTRUMENTALITY OF THE UNITED STATES.
This certifies that CEDE & CO. is the registered owner of a Percentage
Interest (obtained by dividing the Initial Certificate Principal Balance of this
Certificate by the Original Class Certificate Principal Balance of the Class M-2
Certificates) in that certain beneficial ownership interest evidenced by all the
Class M-2 Certificates in the Trust Fund created pursuant to a Pooling and
Servicing Agreement, dated as specified above (the "Agreement"), among ▇▇▇▇▇▇▇
▇▇▇▇▇ Mortgage Investors, Inc. (hereinafter called the "Depositor," which term
includes any successor entity under the Agreement), Credit-Based Asset Servicing
and Securitization LLC (the "Seller"), the Servicer and 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 last Business Day of the month immediately preceding the
month in which the related Distribution Date occurs (the "Record Date"), from
funds in the Distribution Account 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-2 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 or on behalf of the Trustee by wire
transfer in immediately available funds to the account of the Person entitled
thereto if such Person shall have so notified the Certificate Registrar 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-2 Certificates
the aggregate Initial Certificate Principal Balance of which is in excess of
$5,000,000, or 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, provided that the Certificate Registrar may deduct a reasonable wire
transfer fee from any payment made by wire transfer. Notwithstanding the above,
the final distribution on this Certificate will be made after due notice by the
Trustee of the pendency of such distribution and only upon presentation and
surrender of this Certificate at the office or agency appointed by the Trustee
for that purpose as provided in the Agreement.
The Class M-2 Pass-Through Rate on each Distribution Date will be a rate
per annum equal to the least of (i) LIBOR as of the related LIBOR Determination
Date, plus the Class M-2 Certificate Margin, (ii) the Subordinate Rate Cap and
(iii) the Subordinate Maximum Rate Cap.
C-3-3
This Certificate is one of a duly authorized issue of Certificates
designated as C-BASS Mortgage Loan Asset-Backed Certificates of the Series
specified on the face hereof (herein called the "Certificates") and representing
a Percentage Interest in the Class M-2 Certificates.
The Class M-2 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.
This Certificate is subordinated in right of payment to the Class A and
Class M-1 Certificates as described in the Agreement.
The Agreement permits, with certain exceptions therein provided, the
amendment thereof and the modification of the rights and obligations of the
Depositor, the Servicer, the Trustee, the Seller and the rights of the
Certificateholders under the Agreement at any time by the Depositor, the
Servicer, the Seller and the Trustee with the consent of the Holders of
Certificates entitled to the Voting Rights identified in the Agreement. Any such
consent by the Holder of this Certificate shall be conclusive and binding on
such Holder and upon all future Holders of this Certificate and of any
Certificate issued upon the transfer hereof or in exchange 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 Trustee 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 Trustee and the Certificate
Registrar 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 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 service charge will be made for any such registration of transfer or
exchange of Certificates, but the Certificate Registrar 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.
C-3-4
The Depositor, the Servicer, the Trustee, any Paying Agent and the
Certificate Registrar and any agent of the Depositor, the Servicer, the Trustee,
any Paying Agent or the Certificate Registrar may treat the Person in whose name
this Certificate is registered as the owner hereof for all purposes, and none of
the Depositor, the Servicer, the Trustee, the Certificate Registrar, any Paying
Agent 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 or on behalf of the Trustee 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 the Trust Fund, and (ii) the purchase by the party designated
in the Agreement at a price determined as provided in the Agreement from the
Trust Fund of all 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 the Trust Fund all 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 Principal Balance of the Mortgage Loans at the time of purchase
being 10% or less of the Cut-off Date Aggregate Principal Balance.
The recitals contained herein shall be taken as statements of the
Depositor and the Trustee assumes no responsibility for their correctness.
Unless the certificate of authentication hereon has been executed by the
Certificate Registrar, by manual signature, this Certificate shall not be
entitled to any benefit under the Agreement or be valid for any purpose.
C-3-5
IN WITNESS WHEREOF, the Trustee has caused this Certificate to be duly
executed.
Dated: September 9, 2004
U.S. BANK NATIONAL ASSOCIATION,
as Trustee
By:__________________________________
Authorized Officer
CERTIFICATE OF AUTHENTICATION
This is one of the Certificates referred to in the within-mentioned
Agreement.
U.S. BANK NATIONAL ASSOCIATION, as
Certificate Registrar
By:__________________________________
Authorized Officer
Date of authentication: September 9, 2004
C-3-6
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)
TEN ENT - as tenants by the entireties under Uniform
Gifts to Minors
JT TEN - as joint tenants with right of Act
survivorship and not as
tenants in common _______________
(State)
Additional abbreviations may also be used though not in the above list.
C-3-7
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
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 Certificate Registrar 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 _______________________________________________,
the assignee named above, or __________________________________________________,
as its agent.
C-3-8
EXHIBIT C-4
FORM OF CLASS M-3 CERTIFICATES
UNLESS THIS CERTIFICATE IS PRESENTED BY AN AUTHORIZED REPRESENTATIVE OF
THE DEPOSITORY TRUST COMPANY, A NEW YORK CORPORATION ("DTC"), TO THE
TRUSTEE OR ITS AGENT FOR REGISTRATION OF TRANSFER, EXCHANGE, OR PAYMENT,
AND ANY CERTIFICATE ISSUED IS REGISTERED IN THE NAME OF CEDE & CO. OR IN
SUCH OTHER NAME AS IS REQUESTED BY AN AUTHORIZED REPRESENTATIVE OF DTC
(AND ANY PAYMENT IS MADE TO CEDE & CO. OR TO SUCH OTHER ENTITY AS IS
REQUESTED BY AN AUTHORIZED REPRESENTATIVE OF DTC), ANY TRANSFER, PLEDGE,
OR OTHER USE HEREOF FOR VALUE OR OTHERWISE BY OR TO ANY PERSON IS WRONGFUL
INASMUCH AS THE REGISTERED OWNER HEREOF, CEDE & CO., HAS AN INTEREST
HEREIN.
THIS CERTIFICATE IS SUBORDINATED IN RIGHT OF PAYMENT TO THE CLASS A, CLASS
M-1 AND CLASS M-2 CERTIFICATES AS DESCRIBED IN THE AGREEMENT REFERRED TO
HEREIN.
EXCEPT AS PROVIDED IN SECTION 5.02(D) OF THE AGREEMENT REFERRED TO HEREIN,
NO TRANSFER OF THIS CERTIFICATE SHALL BE REGISTERED UNLESS THE TRUSTEE AND
THE CERTIFICATE REGISTRAR SHALL HAVE RECEIVED (A) A REPRESENTATION FROM
THE TRANSFEREE OF THIS CERTIFICATE TO THE EFFECT THAT SUCH TRANSFEREE IS
NOT AN EMPLOYEE BENEFIT PLAN OR ARRANGEMENT SUBJECT TO TITLE I OF THE
EMPLOYEE RETIREMENT INCOME SECURITY ACT OF 1974, AS AMENDED ("ERISA"), A
PLAN SUBJECT TO SECTION 4975 OF THE INTERNAL REVENUE CODE OF 1986, AS
AMENDED (THE "CODE") OR A PLAN SUBJECT TO STATE, LOCAL OR OTHER FEDERAL
LAW SUBSTANTIVELY SIMILAR TO THE FOREGOING PROVISIONS OF ERISA OR THE CODE
("SIMILAR LAW") (COLLECTIVELY, A "PLAN"), AND IS NOT DIRECTLY OR
INDIRECTLY ACQUIRING THIS CERTIFICATE FOR, ON BEHALF OF OR WITH ANY ASSETS
OF ANY SUCH PLAN, (B) A REPRESENTATION THAT THE TRANSFEREE IS AN INSURANCE
COMPANY THAT IS ACQUIRING THE CERTIFICATE WITH ASSETS OF AN "INSURANCE
COMPANY GENERAL ACCOUNT" AS DEFINED IN SECTION V(E) OF PROHIBITED
TRANSACTION CLASS EXEMPTION ("PTCE") 95-60, OR (C) SOLELY IN THE CASE OF A
DEFINITIVE CERTIFICATE, AN OPINION OF COUNSEL SATISFACTORY TO THE TRUSTEE
AND THE CERTIFICATE REGISTRAR, AND UPON WHICH THE TRUSTEE AND THE
CERTIFICATE REGISTRAR SHALL BE ENTITLED TO RELY, TO THE
C-4-1
EFFECT THAT THE ACQUISITION AND HOLDING OF THIS CERTIFICATE BY THE
TRANSFEREE WILL NOT RESULT IN A NONEXEMPT PROHIBITED TRANSACTION UNDER
TITLE I OF ERISA OR SECTION 4975 OF THE CODE, OR A VIOLATION OF SIMILAR
LAW, AND WILL NOT SUBJECT THE CERTIFICATE REGISTRAR, THE DEPOSITOR, THE
SERVICER OR THE TRUSTEE TO ANY OBLIGATION IN ADDITION TO THOSE UNDERTAKEN
BY SUCH ENTITIES IN THE AGREEMENT REFERRED TO HEREIN, WHICH OPINION OF
COUNSEL SHALL NOT BE AN EXPENSE OF THE CERTIFICATE REGISTRAR, THE
DEPOSITOR, THE SERVICER OR THE TRUSTEE.
FOR U.S. FEDERAL INCOME TAX PURPOSES, THIS CERTIFICATE REPRESENTS
BENEFICIAL OWNERSHIP OF A "REGULAR INTEREST" IN A "REAL ESTATE MORTGAGE
INVESTMENT CONDUIT," AS THOSE TERMS ARE DEFINED, RESPECTIVELY, IN SECTIONS
860G AND 860D OF THE CODE AND CERTAIN OTHER PROPERTY.
C-BASS MORTGAGE LOAN ASSET-BACKED CERTIFICATES
SERIES 2004-CB6, CLASS M-3
evidencing a beneficial ownership interest in a portion of a Trust Fund
consisting primarily of a pool of conventional fixed-rate and adjustable-rate
one- to four-family first and second lien mortgage loans formed and sold by
▇▇▇▇▇▇▇ ▇▇▇▇▇ MORTGAGE INVESTORS, INC.
Series 2004-CB6, Class M-3 Original Class Certificate Principal Balance of
the Class M-3 Certificates as of the Closing
Date: $6,889,000.00
Pass-Through Rate: Variable (1)
Date of Pooling and Servicing Agreement Initial Certificate Principal Balance: $6,889,000.00
and Cut-off Date: August 1, 2004
First Distribution Date: September 27, 2004 Servicer: ▇▇▇▇▇▇ Loan Servicing LP
No. Trustee: U.S. Bank National Association
CUSIP: 59020U JE 6 Closing Date: September 9 , 2004
ISIN: US59020UJE64
DISTRIBUTIONS IN REDUCTION OF THE CERTIFICATE PRINCIPAL BALANCE OF THIS
CERTIFICATE MAY BE MADE MONTHLY AS SET FORTH HEREIN. ACCORDINGLY, THE
OUTSTANDING
------------------------
(1) Subject to a cap as described in the Agreement.
C-4-2
CERTIFICATE PRINCIPAL BALANCE HEREOF AT ANY TIME MAY BE LESS THAN THE
AMOUNT SHOWN ABOVE.
THIS CERTIFICATE DOES NOT REPRESENT AN OBLIGATION OF OR INTEREST IN
▇▇▇▇▇▇▇ ▇▇▇▇▇ MORTGAGE INVESTORS, INC., THE SERVICER, THE TRUSTEE OR ANY
OF THEIR AFFILIATES. THIS CERTIFICATE IS NOT GUARANTEED BY ANY AGENCY OR
INSTRUMENTALITY OF THE UNITED STATES.
This certifies that CEDE & CO. is the registered owner of a Percentage
Interest (obtained by dividing the Initial Certificate Principal Balance of this
Certificate by the Original Class Certificate Principal Balance of the Class M-3
Certificates) in that certain beneficial ownership interest evidenced by all the
Class M-3 Certificates in the Trust Fund created pursuant to a Pooling and
Servicing Agreement, dated as specified above (the "Agreement"), among ▇▇▇▇▇▇▇
▇▇▇▇▇ Mortgage Investors, Inc. (hereinafter called the "Depositor," which term
includes any successor entity under the Agreement), Credit-Based Asset Servicing
and Securitization LLC (the "Seller"), the Servicer and 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 last Business Day of the month immediately preceding the
month in which the related Distribution Date occurs (the "Record Date"), from
funds in the Distribution Account 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-3 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 or on behalf of the Trustee by wire
transfer in immediately available funds to the account of the Person entitled
thereto if such Person shall have so notified the Certificate Registrar 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-3 Certificates
the aggregate Initial Certificate Principal Balance of which is in excess of
$5,000,000, or 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, provided that the Certificate Registrar may deduct a reasonable wire
transfer fee from any payment made by wire transfer. Notwithstanding the above,
the final distribution on this Certificate will be made after due notice by the
Trustee of the pendency of such distribution and only upon presentation and
surrender of this Certificate at the office or agency appointed by the Trustee
for that purpose as provided in the Agreement.
The Class M-3 Pass-Through Rate on each Distribution Date will be a rate
per annum equal to the least of (i) LIBOR as of the related LIBOR Determination
Date, plus the Class M-3 Certificate Margin, (ii) the Subordinate Rate Cap and
(iii) the Subordinate Maximum Rate Cap.
C-4-3
This Certificate is one of a duly authorized issue of Certificates
designated as C-BASS Mortgage Loan Asset-Backed Certificates of the Series
specified on the face hereof (herein called the "Certificates") and representing
a Percentage Interest in the Class M-3 Certificates.
The Class M-3 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.
This Certificate is subordinated in right of payment to the Class A, Class
M-1 and Class M-2 Certificates as described in the Agreement.
The Agreement permits, with certain exceptions therein provided, the
amendment thereof and the modification of the rights and obligations of the
Depositor, the Servicer, the Trustee, the Seller and the rights of the
Certificateholders under the Agreement at any time by the Depositor, the
Servicer, the Seller and the Trustee with the consent of the Holders of
Certificates entitled to the Voting Rights identified in the Agreement. Any such
consent by the Holder of this Certificate shall be conclusive and binding on
such Holder and upon all future Holders of this Certificate and of any
Certificate issued upon the transfer hereof or in exchange 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 Trustee 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 Trustee and the Certificate
Registrar 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 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 service charge will be made for any such registration of transfer or
exchange of Certificates, but the Certificate Registrar 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 Servicer, the Trustee, any Paying Agent and the
Certificate Registrar
C-4-4
and any agent of the Depositor, the Servicer, the Trustee, any Paying Agent or
the Certificate Registrar may treat the Person in whose name this Certificate is
registered as the owner hereof for all purposes, and none of the Depositor, the
Servicer, the Trustee, the Certificate Registrar, any Paying Agent 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 or on behalf of the Trustee 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 the Trust Fund, and (ii) the purchase by the party designated in
the Agreement at a price determined as provided in the Agreement from the Trust
Fund of all 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 the Trust Fund all 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
Principal Balance of the Mortgage Loans at the time of purchase being 10% or
less of the Cut-off Date Aggregate Principal Balance.
The recitals contained herein shall be taken as statements of the
Depositor and the Trustee assumes no responsibility for their correctness.
Unless the certificate of authentication hereon has been executed by the
Certificate Registrar, by manual signature, this Certificate shall not be
entitled to any benefit under the Agreement or be valid for any purpose.
C-4-5
IN WITNESS WHEREOF, the Trustee has caused this Certificate to be duly
executed.
Dated: September 9, 2004
U.S. BANK NATIONAL ASSOCIATION,
as Trustee
By:_____________________________
Authorized Officer
CERTIFICATE OF AUTHENTICATION
This is one of the Certificates referred to in the within-mentioned
Agreement.
U.S. BANK NATIONAL ASSOCIATION,
as Certificate Registrar
By:_____________________________
Authorized Officer
Date of authentication: September 9, 2004
C-4-6
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)
TEN ENT - as tenants by the entireties under Uniform
Gifts to Minors
JT TEN - as joint tenants with right Act
of survivorship and not as
tenants in common
________________
(State)
Additional abbreviations may also be used though not in the above list.
C-4-7
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
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 Certificate Registrar 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 ____________________________________________________,
the assignee named above, or __________________________________________________,
as its agent.
C-4-8
EXHIBIT C-5
FORM OF CLASS X CERTIFICATE
FOR U.S. FEDERAL INCOME TAX PURPOSES, THIS CERTIFICATE REPRESENTS A DIRECT
OR INDIRECT BENEFICIAL INTEREST IN A "REGULAR INTEREST" IN A "REAL ESTATE
MORTGAGE INVESTMENT CONDUIT," AS THOSE TERMS ARE DEFINED, RESPECTIVELY, IN
SECTIONS 860G AND 860D OF THE INTERNAL REVENUE CODE OF 1986, AS AMENDED
(THE "CODE") AND THE OBLIGATION TO MAKE CERTAIN PAYMENTS.
THIS CLASS X CERTIFICATE IS SUBORDINATE TO THE OFFERED CERTIFICATES OF
THIS SERIES TO THE EXTENT DESCRIBED HEREIN AND IN THE AGREEMENT REFERRED
TO HEREIN.
THIS CLASS X CERTIFICATE WILL NOT BE ENTITLED TO PAYMENTS UNTIL SUCH TIME
AS DESCRIBED IN THE AGREEMENT REFERRED TO HEREIN.
THIS CLASS X CERTIFICATE HAS NOT BEEN REGISTERED OR QUALIFIED UNDER THE
SECURITIES ACT OF 1933, AS AMENDED (THE "1933 ACT"), OR THE SECURITIES
LAWS OF ANY STATE. ANY RESALE, TRANSFER OR OTHER DISPOSITION OF THIS
CERTIFICATE WITHOUT SUCH REGISTRATION OR QUALIFICATION MAY BE MADE ONLY IN
A TRANSACTION THAT DOES NOT REQUIRE SUCH REGISTRATION OR QUALIFICATION AND
IN ACCORDANCE WITH THE PROVISIONS OF SECTION 5.02 OF THE AGREEMENT
REFERRED TO HEREIN.
EXCEPT AS PROVIDED IN SECTION 5.02(D) OF THE AGREEMENT REFERRED TO HEREIN,
NO TRANSFER OF THIS CLASS X CERTIFICATE SHALL BE REGISTERED UNLESS THE
TRUSTEE AND THE CERTIFICATE REGISTRAR SHALL HAVE RECEIVED A REPRESENTATION
FROM THE TRANSFEREE OF THIS CERTIFICATE TO THE EFFECT THAT SUCH TRANSFEREE
IS NOT AN EMPLOYEE BENEFIT PLAN OR ARRANGEMENT SUBJECT TO TITLE I OF THE
EMPLOYEE RETIREMENT INCOME SECURITY ACT OF 1974, AS AMENDED ("ERISA"), A
PLAN SUBJECT TO SECTION 4975 OF THE CODE OR A PLAN SUBJECT TO STATE, LOCAL
OR OTHER FEDERAL LAW SUBSTANTIVELY SIMILAR TO THE FOREGOING PROVISIONS OF
ERISA OR THE CODE (COLLECTIVELY, A "PLAN"), AND IS NOT DIRECTLY OR
INDIRECTLY ACQUIRING THIS CERTIFICATE FOR, ON BEHALF OF OR WITH ANY ASSETS
OF ANY SUCH PLAN.
C-5-1
C-BASS MORTGAGE LOAN ASSET-BACKED CERTIFICATES
SERIES 2004-CB6, CLASS X
evidencing a beneficial ownership interest in a portion of a Trust Fund
consisting primarily of a pool of conventional fixed-rate and adjustable-rate
one- to four-family first and second lien mortgage loans formed and sold by
▇▇▇▇▇▇▇ ▇▇▇▇▇ MORTGAGE INVESTORS, INC.
Series 2004-CB6, Class X Servicer: ▇▇▇▇▇▇ Loan Servicing LP
Date of Pooling and Servicing Agreement
and Cut-off Date: August 1, 2004 Trustee: U.S. Bank National Association
First Distribution Date: September 27,
2004 Closing Date: September 9, 2004
CUSIP: 59020U JJ 5
ISIN: US59020UJJ51
Percentage Interest: 100%
THIS CERTIFICATE DOES NOT REPRESENT AN OBLIGATION OF OR INTEREST IN
▇▇▇▇▇▇▇ ▇▇▇▇▇ MORTGAGE INVESTORS, INC., THE SERVICER, THE TRUSTEE OR ANY
OF THEIR AFFILIATES. THIS CERTIFICATE IS NOT GUARANTEED BY ANY AGENCY OR
INSTRUMENTALITY OF THE UNITED STATES.
This certifies that ▇▇▇▇▇▇▇ Lynch, Pierce, ▇▇▇▇▇▇ & ▇▇▇▇▇ Incorporated is
the registered owner of a Percentage Interest set forth above in that certain
beneficial ownership interest evidenced by all the Class X Certificates in the
Trust Fund created pursuant to a Pooling and Servicing Agreement, dated as
specified above (the "Agreement"), among ▇▇▇▇▇▇▇ ▇▇▇▇▇ Mortgage Investors, Inc.
(hereinafter called the "Depositor," which term includes any successor entity
under the Agreement), Credit-Based Asset Servicing and Securitization LLC (the
"Seller"), the Servicer and 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 last Business Day of the month immediately preceding the
month in which the related Distribution Date occurs (the "Record Date"), from
funds in the Distribution Account 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 X 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 or on behalf of the Trustee by wire
transfer in immediately available funds
C-5-2
to the account of the Person entitled thereto if such Person shall have so
notified the Certificate Registrar 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 X Certificates the aggregate Initial Certificate
Principal Balance of which is in excess of a 66% Percentage Interest of the
Class X Certificates, or 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, provided that the Certificate Registrar may deduct a
reasonable wire transfer fee from any payment made by wire transfer.
Notwithstanding the above, the final distribution on this Certificate will be
made after due notice by the Trustee of the pendency of such distribution and
only upon presentation and surrender of this Certificate at the office or agency
appointed by the Trustee for that purpose as provided in the Agreement.
This Certificate is one of a duly authorized issue of Certificates
designated as C-BASS Mortgage Loan Asset-Backed Certificates of the Series
specified on the face hereof (herein called the "Certificates") and representing
the Percentage Interest specified on the face hereof.
The Class X 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 Servicer, the Trustee, the Seller and the rights of the
Certificateholders under the Agreement at any time by the Depositor, the
Servicer, the Seller and the Trustee with the consent of the Holders of
Certificates entitled to the Voting Rights identified in the Agreement. Any such
consent by the Holder of this Certificate shall be conclusive and binding on
such Holder and upon all future Holders of this Certificate and of any
Certificate issued upon the transfer hereof or in exchange 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 Trustee 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 Trustee and the Certificate
Registrar 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
C-5-3
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 that transfer is made
pursuant to an effective registration statement under the 1933 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 a transfer is to be made without registration or qualification
(i) the Certificateholder desiring to effect the transfer and such
Certificateholder's prospective transferee shall each execute a representation
letter in the form described by the Agreement certifying to the Certificate
Registrar the facts surrounding the transfer, and (ii) unless such transfer is
made in reliance upon Rule 144A under the 1933 Act, the Depositor and the
Certificate Registrar may require an Opinion of Counsel satisfactory to them
that such transfer may be made without such registration or qualification, which
Opinion of Counsel shall not be an expense of the Depositor, the Trustee or the
Certificate Registrar, in their respective capacities as such. None of the
Depositor, the Certificate Registrar or the Trustee is obligated to register or
qualify the Class of Certificates specified on the face hereof under the 1933
Act or any other securities law or to take any action not otherwise required
under the Agreement to permit the transfer of such Certificates without
registration or qualification. Any such Certificateholder desiring to effect
such transfer shall, and does hereby agree to, indemnify the Trustee, the
Depositor, the Certificate Registrar and the Servicer 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 a Certificate or any interest therein may be made to
employee benefit plans and certain other retirement plans and arrangements,
including individual retirement accounts and annuities, ▇▇▇▇▇ plans and
collective investment funds and separate accounts in which such plans, accounts
or arrangements are invested that are subject to the fiduciary responsibility
provisions of ERISA and Section 4975 of the Code ("Plans") or any person who is
directly or indirectly purchasing the Certificate or interest therein on behalf
of, as named fiduciary of, as trustee of, or with assets of a Plan.
No service charge will be made for any such registration of transfer or
exchange of Certificates, but the Trustee 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 Servicer, the Trustee, any Paying Agent and the
Certificate Registrar and any agent of the Depositor, the Servicer, the Trustee,
any Paying Agent or the Certificate Registrar may treat the Person in whose name
this Certificate is registered as the owner hereof for all purposes, and none of
the Depositor, the Servicer, the Trustee, the Certificate Registrar, any Paying
Agent 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 or on behalf of the Trustee 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 the Trust Fund, and (ii) the purchase by the party designated in
the Agreement
C-5-4
at a price determined as provided in the Agreement from the Trust Fund of all
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 the Trust Fund all 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 Principal Balance of
the Mortgage Loans at the time of purchase being 10% or less of the Cut-off Date
Aggregate Principal Balance.
The recitals contained herein shall be taken as statements of the
Depositor and the Trustee assumes no responsibility for their correctness.
Unless the certificate of authentication hereon has been executed by the
Certificate Registrar, by manual signature, this Certificate shall not be
entitled to any benefit under the Agreement or be valid for any purpose.
C-5-5
IN WITNESS WHEREOF, the Trustee has caused this Certificate to be duly
executed.
Dated: September 9, 2004
U.S. BANK NATIONAL ASSOCIATION,
as Trustee
By:_____________________________
Authorized Officer
CERTIFICATE OF AUTHENTICATION
This is one of the Certificates referred to in the within-mentioned
Agreement.
U.S. BANK NATIONAL ASSOCIATION,
as Certificate Registrar
By:_____________________________
Authorized Officer
Date of authentication: September 9, 2004
C-5-6
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)
TEN ENT - as tenants by the entireties under Uniform
Gifts to Minors
JT TEN - as joint tenants with right of Act
survivorship and not as
tenants in common
________________
(State)
Additional abbreviations may also be used though not in the above list.
C-5-7
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
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 Certificate Registrar 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 ____________________________________________________,
the assignee named above, or __________________________________________________,
as its agent.
C-5-8
EXHIBIT C-6
FORM OF CLASS N CERTIFICATE
FOR U.S. FEDERAL INCOME TAX PURPOSES, THIS CERTIFICATE REPRESENTS A DIRECT
OR INDIRECT BENEFICIAL INTEREST IN A "REGULAR INTEREST" IN A "REAL ESTATE
MORTGAGE INVESTMENT CONDUIT," AS THOSE TERMS ARE DEFINED, RESPECTIVELY, IN
SECTIONS 860G AND 860D OF THE INTERNAL REVENUE CODE OF 1986, AS AMENDED
(THE "CODE") AND THE OBLIGATION TO MAKE CERTAIN PAYMENTS.
THIS CLASS N CERTIFICATE IS SUBORDINATE TO THE OFFERED CERTIFICATES OF
THIS SERIES TO THE EXTENT DESCRIBED HEREIN AND IN THE AGREEMENT REFERRED
TO HEREIN.
THIS CLASS N CERTIFICATE WILL NOT BE ENTITLED TO PAYMENTS UNTIL SUCH TIME
AS DESCRIBED IN THE AGREEMENT REFERRED TO HEREIN.
THIS CLASS N CERTIFICATE HAS NOT BEEN REGISTERED OR QUALIFIED UNDER THE
SECURITIES ACT OF 1933, AS AMENDED (THE "1933 ACT"), OR THE SECURITIES
LAWS OF ANY STATE. ANY RESALE, TRANSFER OR OTHER DISPOSITION OF THIS
CERTIFICATE WITHOUT SUCH REGISTRATION OR QUALIFICATION MAY BE MADE ONLY IN
A TRANSACTION THAT DOES NOT REQUIRE SUCH REGISTRATION OR QUALIFICATION AND
IN ACCORDANCE WITH THE PROVISIONS OF SECTION 5.02 OF THE AGREEMENT
REFERRED TO HEREIN.
EXCEPT AS PROVIDED IN SECTION 5.02(D) OF THE AGREEMENT REFERRED TO HEREIN,
NO TRANSFER OF THIS CLASS N CERTIFICATE SHALL BE REGISTERED UNLESS THE
TRUSTEE AND THE CERTIFICATE REGISTRAR SHALL HAVE RECEIVED A REPRESENTATION
FROM THE TRANSFEREE OF THIS CERTIFICATE TO THE EFFECT THAT SUCH TRANSFEREE
IS NOT AN EMPLOYEE BENEFIT PLAN OR ARRANGEMENT SUBJECT TO TITLE I OF THE
EMPLOYEE RETIREMENT INCOME SECURITY ACT OF 1974, AS AMENDED ("ERISA"), A
PLAN SUBJECT TO SECTION 4975 OF THE CODE OR A PLAN SUBJECT TO STATE, LOCAL
OR OTHER FEDERAL LAW SUBSTANTIVELY SIMILAR TO THE FOREGOING PROVISIONS OF
ERISA OR THE CODE (COLLECTIVELY, A "PLAN"), AND IS NOT DIRECTLY OR
INDIRECTLY ACQUIRING THIS CERTIFICATE FOR, ON BEHALF OF OR WITH ANY ASSETS
OF ANY SUCH PLAN.
C-6-1
C-BASS MORTGAGE LOAN ASSET-BACKED CERTIFICATES
SERIES 2004-CB6, CLASS N
evidencing a beneficial ownership interest in a portion of a Trust Fund
consisting primarily of a pool of conventional fixed-rate and adjustable-rate
one- to four-family first and second lien mortgage loans formed and sold by
▇▇▇▇▇▇▇ ▇▇▇▇▇ MORTGAGE INVESTORS, INC.
Series 2004-CB6, Class N Original Class Certificate Notional
Balance of the Class N Certificates as
of the Closing Date: $19,000,000.00
Pass-Through Rate: 8.00% Initial Notional Amount: $19,000,000.00
Date of Pooling and Servicing Agreement
and Cut-off Date: August 1, 2004 Servicer: ▇▇▇▇▇▇ Loan Servicing LP
First Distribution Date: September 27,
2004 Trustee: U.S. Bank National Association
CUSIP: 59020U JK 2
ISIN: US59020UJK25 Closing Date: September 9, 2004
THIS CERTIFICATE DOES NOT REPRESENT AN OBLIGATION OF OR INTEREST IN
▇▇▇▇▇▇▇ ▇▇▇▇▇ MORTGAGE INVESTORS, INC., THE SERVICER, THE TRUSTEE OR ANY
OF THEIR AFFILIATES. THIS CERTIFICATE IS NOT GUARANTEED BY ANY AGENCY OR
INSTRUMENTALITY OF THE UNITED STATES.
This certifies that ▇▇▇▇▇▇▇ Lynch, Pierce, ▇▇▇▇▇▇ & ▇▇▇▇▇ Incorporated is
the registered owner of a Percentage Interest (obtained by dividing the Initial
Notional Amount of this Certificate by the Original Class N Notional Amount) in
that certain beneficial ownership interest evidenced by all the Class N
Certificates in the Trust Fund created pursuant to a Pooling and Servicing
Agreement, dated as specified above (the "Agreement"), among ▇▇▇▇▇▇▇ ▇▇▇▇▇
Mortgage Investors, Inc. (hereinafter called the "Depositor," which term
includes any successor entity under the Agreement), Credit-Based Asset Servicing
and Securitization LLC (the "Seller"), the Servicer and 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 last Business Day of the month immediately preceding the
month in which the related Distribution Date occurs or the Closing Date in the
case of the first Distribution Date (the "Record Date"), from funds in the
Distribution Account in an amount equal to the product of the Percentage
Interest evidenced by this Certificate and the
C-6-2
amount required to be distributed to the Holders of Class N 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 or on behalf of the Trustee by wire
transfer in immediately available funds to the account of the Person entitled
thereto if such Person shall have so notified the Certificate Registrar 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 N Certificates
the aggregate Initial Certificate Principal Balance of which is in excess of a
66% Percentage Interest of the Class N Certificates, or 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, provided that the Certificate
Registrar may deduct a reasonable wire transfer fee from any payment made by
wire transfer. Notwithstanding the above, the final distribution on this
Certificate will be made after due notice by the Trustee of the pendency of such
distribution and only upon presentation and surrender of this Certificate at the
office or agency appointed by the Trustee for that purpose as provided in the
Agreement.
The Pass-Through Rate for this Class N Certificates on each Distribution
Date will be the per annum rate specified above.
This Certificate is one of a duly authorized issue of Certificates
designated as C-BASS Mortgage Loan Asset-Backed Certificates of the Series
specified on the face hereof (herein called the "Certificates") and representing
the Percentage Interest specified on the face hereof.
The Class N 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 Servicer, the Trustee, the Seller and the rights of the
Certificateholders under the Agreement at any time by the Depositor, the
Servicer, the Seller and the Trustee with the consent of the Holders of
Certificates entitled to the Voting Rights identified in the agreement. Any such
consent by the Holder of this Certificate shall be conclusive and binding on
such Holder and upon all future Holders of this Certificate and of any
Certificate issued upon the transfer hereof or in exchange 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 Trustee 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 Trustee and the
C-6-3
Certificate Registrar 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 that transfer is made
pursuant to an effective registration statement under the 1933 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 a transfer is to be made without registration or qualification
(i) the Certificateholder desiring to effect the transfer and such
Certificateholder's prospective transferee shall each execute a representation
letter in the form described by the Agreement certifying to the Certificate
Registrar the facts surrounding the transfer, and (ii) unless such transfer is
made in reliance upon Rule 144A under the 1933 Act, the Depositor and the
Certificate Registrar may require an Opinion of Counsel satisfactory to them
that such transfer may be made without such registration or qualification, which
Opinion of Counsel shall not be an expense of the Depositor, the Trustee or the
Certificate Registrar, in their respective capacities as such. None of the
Depositor, the Certificate Registrar or the Trustee is obligated to register or
qualify the Class of Certificates specified on the face hereof under the 1933
Act or any other securities law or to take any action not otherwise required
under the Agreement to permit the transfer of such Certificates without
registration or qualification. Any such Certificateholder desiring to effect
such transfer shall, and does hereby agree to, indemnify the Trustee, the
Depositor, the Certificate Registrar and the Servicer 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 a Certificate or any interest therein may be made to
employee benefit plans and certain other retirement plans and arrangements,
including individual retirement accounts and annuities, ▇▇▇▇▇ plans and
collective investment funds and separate accounts in which such plans, accounts
or arrangements are invested that are subject to the fiduciary responsibility
provisions of ERISA and Section 4975 of the Code ("Plans") or any person who is
directly or indirectly purchasing the Certificate or interest therein on behalf
of, as named fiduciary of, as trustee of, or with assets of a Plan.
No service charge will be made for any such registration of transfer or
exchange of Certificates, but the Certificate Registrar 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 Servicer, the Trustee, any Paying Agent and the
Certificate Registrar and any agent of the Depositor, the Servicer, the Trustee,
any Paying Agent or the Certificate Registrar may treat the Person in whose name
this Certificate is registered as the owner hereof
C-6-4
for all purposes, and none of the Depositor, the Servicer, the Trustee, the
Certificate Registrar, any Paying Agent 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 or on behalf of the Trustee 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 the Trust Fund, and (ii) the purchase by the party designated in
the Agreement at a price determined as provided in the Agreement from the Trust
Fund of all 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 the Trust Fund all 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
Principal Balance of the Mortgage Loans at the time of purchase being 10% or
less of the Cut-off Date Aggregate Principal Balance.
The recitals contained herein shall be taken as statements of the
Depositor and the Trustee assumes no responsibility for their correctness.
Unless the certificate of authentication hereon has been executed by the
Certificate Registrar, by manual signature, this Certificate shall not be
entitled to any benefit under the Agreement or be valid for any purpose.
C-6-5
IN WITNESS WHEREOF, the Trustee has caused this Certificate to be duly
executed.
Dated: September 9, 2004
U.S. BANK NATIONAL ASSOCIATION,
as Trustee
By:_____________________________
Authorized Officer
CERTIFICATE OF AUTHENTICATION
This is one of the Certificates referred to in the within-mentioned
Agreement.
U.S. BANK NATIONAL ASSOCIATION,
as Certificate Registrar
By:_____________________________
Authorized Officer
Date of authentication: September 9, 2004
C-6-6
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)
TEN ENT - as tenants by the entireties under Uniform
Gifts to Minors
JT TEN - as joint tenants with right Act
of survivorship and not as
tenants in common
________________
(State)
Additional abbreviations may also be used though not in the above list.
C-6-7
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
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 Certificate Registrar 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 ____________________________________________________,
the assignee named above, or __________________________________________________,
as its agent.
▇-▇-▇
▇▇▇▇▇▇▇ ▇-▇
MORTGAGE LOAN SCHEDULE FOR GROUP I MORTGAGE LOANS
[ON FILE WITH DECHERT LLP]
D-1
EXHIBIT D-2
MORTGAGE LOAN SCHEDULE FOR GROUP II MORTGAGE LOANS
[ON FILE WITH DECHERT LLP]
D-2
EXHIBIT E
FORM OF REQUEST FOR RELEASE OF DOCUMENTS
To: U.S. Bank National Association
▇▇ ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇-▇▇-▇▇▇▇
Attention: Structured Finance, C-BASS ▇▇▇▇-▇▇▇
▇▇. ▇▇▇▇, ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇-▇▇▇▇
[and/or its designee]
Re: Pooling and Servicing Agreement dated as of August 1, 2004 among ▇▇▇▇▇▇▇
▇▇▇▇▇ Mortgage Investors, Inc., as depositor, Credit-Based Asset Servicing
and Securitization LLC, U.S. Bank National Association, as trustee and
▇▇▇▇▇▇ Loan Servicing LP, as servicer, relating to C-BASS Mortgage Loan
Asset-Backed Certificates, Series 2004-CB6
In connection with the administration of the Mortgage Loans held by you,
as Trustee, pursuant to the above-captioned Pooling and Servicing Agreement, we
request the release, and hereby acknowledge receipt, of the Mortgage File for
the Mortgage Loan described below, for the reason indicated.
Mortgage Loan Number:
Mortgagor Name, Address & Zip Code:
Reason for Requesting Documents (check one):
_______ 1. Mortgage Paid in Full
_______ 2. Foreclosure
_______ 3. Substitution
_______ 4. Other Liquidation (Repurchases, etc.)
_______ 5. Nonliquidation
Address to which the Trustee should deliver the Mortgage File:
By: ______________________________
(authorized signer)
Address: _________________________
Date: ____________________________
E-1
If box 1 or 2 above is checked, and if all or part of the Mortgage File was
previously released to us, please release to us our previous receipt on file
with you, as well as any additional documents in your possession relating to the
above specified Mortgage Loan.
If box 3, 4, 5 or 6 above is checked, upon our return of all of the above
documents to you as Trustee, please acknowledge your receipt by signing in the
space indicated below, and returning this form.
Please acknowledge the execution of the above request by your signature and date
below:
U.S. Bank National Association, as Trustee
By: ________________________________ ____________________________
Signature Date
Documents returned to Trustee:
By: ________________________________ ____________________________
Signature Date
E-2
EXHIBIT F-1
FORM OF TRUSTEE'S INITIAL CERTIFICATION
Date
▇▇▇▇▇▇▇ ▇▇▇▇▇ Mortgage Investors, Inc.
4 World Financial Center, 10th Floor
New York, New York 10080
▇▇▇▇▇▇ Loan Servicing LP
▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇
▇▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇▇
Re: Pooling and Servicing Agreement (the "Pooling and Servicing
Agreement"), dated as of August 1, 2004 among ▇▇▇▇▇▇▇ ▇▇▇▇▇ Mortgage
Investors, Inc., as depositor, Credit-Based Asset Servicing and
Securitization LLC, as seller, ▇▇▇▇▇▇ Loan Servicing LP, as
servicer, and U.S. Bank National Association, as trustee with
respect to C-BASS Mortgage Loan Asset-Backed Certificates, Series
2004-CB6.
Ladies and Gentlemen:
In accordance with Section 2.02 of the Pooling and Servicing Agreement,
the undersigned, as Trustee, hereby certifies that it received confirmation from
the Custodian that the Custodian has received the documents listed in Section
2.01 of the Pooling and Servicing Agreement for each Mortgage File pertaining to
each Mortgage Loan listed on Exhibit D-1 and Exhibit D-2, to the Pooling and
Servicing Agreement, subject to any exceptions noted on Schedule I hereto.
Capitalized words and phrases used herein and not otherwise defined herein
shall have the respective meanings assigned to them in the Pooling and Servicing
Agreement. This Certificate is subject in all respects to the terms of Section
2.02 of the Pooling and Servicing Agreement and the Pooling and Servicing
Agreement sections cross-referenced therein.
U.S. BANK NATIONAL ASSOCIATION,
as Trustee
By:______________________________
Name:
Title:
F-1
EXHIBIT F-2
FORM OF TRUSTEE'S FINAL CERTIFICATION
[Date]
▇▇▇▇▇▇▇ ▇▇▇▇▇ Mortgage Investors, Inc.
4 World Financial Center, 10th Floor
New York, New York 10080
▇▇▇▇▇▇ Loan Servicing LP
▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇
▇▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇▇
Re: Pooling and Servicing Agreement (the "Pooling and Servicing Agreement"),
dated as of August 1, 2004 among ▇▇▇▇▇▇▇ ▇▇▇▇▇ Mortgage Investors, Inc.,
as depositor, Credit-Based Asset Servicing and Securitization LLC, as
seller, ▇▇▇▇▇▇ Loan Servicing LP, as servicer, and U.S. Bank National
Association, as trustee with respect to C-BASS Mortgage Loan Asset-Backed
Certificates, Series 2004-CB6.
Ladies and Gentlemen:
In accordance with Section 2.02 of the Pooling and Servicing Agreement,
the undersigned, as Trustee, hereby certifies that as to each Mortgage Loan
listed in the Mortgage Loan Schedule (other than any Mortgage Loan paid in full
or listed on Schedule I hereto) it received confirmation from the Custodian that
the Custodian has received the applicable documents listed in Section 2.01 of
the Pooling and Servicing Agreement.
The undersigned hereby certifies that as to each Mortgage Loan identified
on the Mortgage Loan Schedule, other than any Mortgage Loan listed on Schedule I
hereto, it has reviewed the documents listed above and has determined that each
such document appears to be complete and, based on an examination of such
documents, the information set forth in the Mortgage Loan Schedule is correct.
Capitalized words and phrases used herein shall have the respective
meanings assigned to them in the Pooling and Servicing Agreement. This
Certificate is qualified in all respects by the terms of said Pooling and
Servicing Agreement.
U.S. BANK NATIONAL ASSOCIATION,
as Trustee
By:_____________________________
Name:
Title:
F-2
EXHIBIT F-3
FORM OF RECEIPT OF MORTGAGE NOTE
Date
▇▇▇▇▇▇▇ ▇▇▇▇▇ Mortgage Investors, Inc.
4 World Financial ▇▇▇▇▇▇, ▇▇▇▇ ▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇
Re: C-BASS Mortgage Loan Asset-Backed Certificates, Series 2004-CB6
Ladies and Gentlemen:
Pursuant to Section 2.01 of the Pooling and Servicing Agreement, dated as
of August 1, 2004, among ▇▇▇▇▇▇▇ ▇▇▇▇▇ Mortgage Investors, Inc., as depositor,
Credit-Based Asset Servicing and Securitization LLC, as seller, ▇▇▇▇▇▇ Loan
Servicing LP, as servicer, and U.S. Bank National Association, as trustee, we
hereby acknowledge the receipt of the original Mortgage Note (a copy of which is
attached hereto as Exhibit 1) with any exceptions thereto listed on Exhibit 2.
U.S. BANK NATIONAL ASSOCIATION,
as Trustee
By:____________________________
Name:
Title:
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EXHIBIT G
MORTGAGE LOAN PURCHASE AGREEMENT
================================================================================
▇▇▇▇▇▇▇ ▇▇▇▇▇ MORTGAGE INVESTORS, INC.
as Purchaser
and
CREDIT BASED ASSET SERVICING AND SECURITIZATION LLC
as Seller
MORTGAGE LOAN PURCHASE AGREEMENT
Fixed-Rate and Adjustable-Rate Mortgage Loans
2004-CB6 Trust
C BASS Mortgage Loan Asset Backed Certificates, Series 2004-CB6
Dated as of September 9, 2004
================================================================================
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TABLE OF CONTENTS
PAGE
ARTICLE I
DEFINITIONS
Section 1.01 Definitions...................................................................... 1
ARTICLE II
SALE OF MORTGAGE LOANS; PAYMENT OF PURCHASE PRICE
Section 2.01 Sale of Mortgage Loans........................................................... 2
Section 2.02 Obligations of Seller Upon Sale.................................................. 2
Section 2.03 Payment of Purchase Price for the Mortgage Loans................................. 4
ARTICLE III
REPRESENTATIONS AND WARRANTIES; REMEDIES FOR BREACH
Section 3.01 Seller Representations and Warranties Relating to the Mortgage Loans............. 5
Section 3.02 Seller Representations and Warranties............................................ 14
ARTICLE IV
SELLER'S COVENANTS
Section 4.01 Covenants of the Seller.......................................................... 17
ARTICLE V
OPTIONAL PURCHASE OF DEFAULTED MORTGAGE LOANS
ARTICLE VI
TERMINATION
Section 6.01 Termination...................................................................... 18
ARTICLE VII
MISCELLANEOUS PROVISIONS
Section 7.01 Amendment........................................................................ 19
Section 7.02 Governing Law.................................................................... 19
Section 7.03 Notices.......................................................................... 19
Section 7.04 Severability of Provisions....................................................... 19
Section 7.05 Counterparts..................................................................... 19
Section 7.06 Further Agreements............................................................... 20
Section 7.07 Intention of the Parties......................................................... 20
Section 7.08 Successors and Assigns; Assignment of this Agreement............................. 20
Section 7.09 Survival......................................................................... 21
Schedule I Mortgage Loan Schedule
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MORTGAGE LOAN PURCHASE AGREEMENT, dated as of September 9, 2004 (the
"Agreement"), between CREDIT BASED ASSET SERVICING AND SECURITIZATION LLC ("C
BASS" or the "Seller") and ▇▇▇▇▇▇▇ ▇▇▇▇▇ MORTGAGE INVESTORS, INC. (the
"Purchaser").
W I T N E S S E T H:
WHEREAS, the Seller is the owner of either the notes or other
evidence of indebtedness (the "Mortgage Notes") or other evidence of ownership
so indicated on Schedule I hereto, and the other documents or instruments
constituting the Mortgage File (collectively, the "Mortgage Loans"); and
WHEREAS, the Seller, as of the date hereof, owns the mortgages (the
"Mortgages") on the properties (the "Mortgaged Properties") securing such
Mortgage Loans, including rights (a) to any property acquired by foreclosure or
deed in lieu of foreclosure or otherwise, and (b) to the proceeds of any
insurance policies covering the Mortgage Loans or the Mortgaged Properties or
the obligors on the Mortgage Loans; and
WHEREAS, the parties hereto desire that the Seller sell the Mortgage
Loans to the Purchaser and the Purchaser purchase the Mortgage Loans from the
Seller pursuant to the terms of this Agreement; and
WHEREAS, pursuant to the terms of a Pooling and Servicing Agreement,
dated as of August 1, 2004 (the "Pooling and Servicing Agreement"), among the
Seller, as seller, the Purchaser, as depositor, ▇▇▇▇▇▇ Loan Servicing LP
("▇▇▇▇▇▇"), as servicer and U.S. Bank National Association, as trustee (the
"Trustee"), the Purchaser will convey the Mortgage Loans to 2004-CB6 Trust,
Series 2004-CB6.
NOW, THEREFORE, in consideration of the mutual covenants herein
contained, the parties hereto agree as follows:
ARTICLE I
DEFINITIONS
Section 1.01 Definitions. All capitalized terms used but not defined
herein shall have the meanings assigned thereto in the Pooling and Servicing
Agreement.
ARTICLE II
SALE OF MORTGAGE LOANS; PAYMENT OF PURCHASE PRICE
Section 2.01 Sale of Mortgage Loans. The Seller does hereby agree to and
does hereby sell, assign, set over, and otherwise convey to the Purchaser,
without recourse, on the Closing Date, (i) all of its right, title and interest
in and to each Mortgage Loan and the related Cut off Date Principal Balance
thereof, including any Related Documents, (ii) all payments on or collections in
respect of the Mortgage Loans due after the Cut off Date; (iii) all property
which secured such Mortgage Loan and which has been acquired by foreclosure or
deed in lieu of foreclosure; (iv) its interest in any insurance policies in
respect of the Mortgage Loans; and (v)
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all proceeds of any of the foregoing.
Section 2.02 Obligations of Seller Upon Sale.
(a) In connection with any transfer pursuant to Section 2.01
hereof, the Seller further agrees, at its own expense, on or prior to the
Closing Date, (x) to indicate in its books and records that the Mortgage Loans
have been sold to the Purchaser pursuant to this Agreement and (y) to deliver to
the Purchaser and the Trustee a computer file containing a true and complete
list of all the Mortgage Loans specifying, among other things, for each Mortgage
Loan, as of the Cut off Date, its account number and Cut off Date Principal
Balance. Such file (the "Mortgage Loan Schedule") which is included as Exhibit
D-1 to the Pooling and Servicing Agreement, shall also be marked as Schedule I
to this Agreement and is hereby incorporated into and made a part of this
Agreement.
In connection with such transfer and assignment, the Seller, on
behalf of the Purchaser, does hereby deliver or cause to be delivered to, and
deposit with the Trustee, or the Custodian shall cause to be deposited, the
following documents or instruments with respect to each Mortgage Loan (a
"Mortgage File") so transferred and assigned:
(i) the original Mortgage Note and any riders thereto,
endorsed either (A) in blank or (B) in the following form: "Pay to the order of
U.S. Bank National Association, as Trustee under the Pooling and Servicing
Agreement, dated as of August 1, 2004, among Credit-Based Asset Servicing and
Securitization LLC, ▇▇▇▇▇▇▇ ▇▇▇▇▇ Mortgage Investors, Inc., ▇▇▇▇▇▇ Loan
Servicing LP and U.S. Bank National Association, for the 2004-CB6 Trust, without
recourse," or with respect to any lost Mortgage Note, an original lost note
affidavit stating that the original mortgage note was lost, misplaced or
destroyed, together with a copy of the related Mortgage Note;
(ii) the original Mortgage including any riders thereto, with
evidence of recording thereon, and the original recorded power of attorney, if
the Mortgage was executed pursuant to a power of attorney, with evidence of
recording thereon or, if such Mortgage or power of attorney has been submitted
for recording but has not been returned from the applicable public recording
office, has been lost or is not otherwise available, a copy of such Mortgage or
power of attorney, as the case may be, certified to be a true and complete copy
of the original submitted for recording;
(iii) an original Assignment of Mortgage, in form and
substance acceptable for recording. The Mortgage shall be assigned either (A) in
blank or (B) to U.S. Bank National Association, as Trustee under the Pooling and
Servicing Agreement, dated as of August 1, 2004, among Credit-Based Asset
Servicing and Securitization LLC, ▇▇▇▇▇▇▇ ▇▇▇▇▇ Mortgage Investors, Inc., ▇▇▇▇▇▇
Loan Servicing LP and U.S. Bank National Association, for the 2004-CB6 Trust,
without recourse";
(iv) an original or a certified copy of any intervening
assignment of Mortgage showing a complete chain of assignments;
(v) the original or a certified copy of the lender's title
insurance policy;
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(vi) the original or copies of each assumption, modification,
written assurance or substitution agreement, if any; and
(vii) for each FHA Loan, the original mortgage insurance
certificate and for each VA Loan, the related VA guaranty.
If any of the documents referred to in Section 2.02(ii), (iii) or
(iv) above has as of the Closing Date been submitted for recording but either
(x) has not been returned from the applicable public recording office or (y) has
been lost or such public recording office has retained the original of such
document, the obligations of the Seller to deliver such documents shall be
deemed to be satisfied upon (1) delivery to the Trustee or the Custodian no
later than the Closing Date, of a copy of each such document certified by the
Seller in the case of (x) above or the applicable public recording office in the
case of (y) above to be a true and complete copy of the original that was
submitted for recording and (2) if such copy is certified by the Seller,
delivery to the Trustee or the Custodian, promptly upon receipt thereof of
either the original or a copy of such document certified by the applicable
public recording office to be a true and complete copy of the original. If the
original lender's title insurance policy was not delivered pursuant to Section
2.02(v) above, the Seller shall deliver or cause to be delivered to the
Custodian, a written commitment or interim binder or preliminary report of title
issued by the title insurance or escrow company, with the original to be
delivered to the Custodian, promptly upon receipt thereof. The Seller shall
deliver or cause to be delivered to the Trustee or the Custodian promptly upon
receipt thereof any other documents constituting a part of a Mortgage File
received with respect to any Mortgage Loan, including, but not limited to, any
original documents evidencing an assumption or modification of any Mortgage
Loan.
Upon discovery or receipt of notice of any materially defective
document in, or that a document is missing from, a Mortgage File, the Seller
shall have 120 days to cure such defect or 150 days following the Closing Date,
in the case of missing Mortgages or Assignments or deliver such missing document
to the Trustee or the Custodian. If the Seller does not cure such defect or
deliver such missing document within such time period, the Seller shall either
repurchase or substitute for such Mortgage Loan in accordance with Section 3.01
hereof.
The Purchaser hereby acknowledges its acceptance of all right, title
and interest to the Mortgage Loans and other property, now existing and
hereafter created, conveyed to it pursuant to Section 2.01.
The parties hereto intend that the transaction set forth herein be a
sale by the Seller to the Purchaser of all the Seller's right, title and
interest in and to the Mortgage Loans and other property described above. In the
event the transaction set forth herein is deemed not to be a sale, the Seller
hereby grants to the Purchaser a first priority perfected security interest in
all of the Seller's right, title and interest in, to and under the Mortgage
Loans and other property described above, whether now existing or hereafter
created, to secure all of the Seller's obligations hereunder; and this Agreement
shall constitute a security agreement under applicable law. The Seller and the
Purchaser shall, to the extent consistent with this Agreement, take such actions
as may be necessary to ensure that, if this Agreement were deemed to create a
security interest in the Mortgage Loans, such security interest would be deemed
to be a perfected security
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interest of first priority under applicable law and will be maintained as such
throughout the term of the Pooling and Servicing Agreement.
(b) The Seller shall cause the Assignments of Mortgage which were
delivered in blank to be completed and shall cause all Assignments referred to
in Section 2.02(iii) hereof and, to the extent necessary, in Section 2.02(iv)
hereof to be recorded. The Seller shall cause the Servicer to deliver such
Assignments for recording within 30 days of the Closing Date. The Seller shall
cause the Servicer to furnish the Trustee, or its designated agent, with a copy
of each Assignment of Mortgage submitted for recording. In the event that any
such Assignment is lost or returned unrecorded because of a defect therein, the
Seller shall cause the Servicer to promptly have a substitute Assignment
prepared or have such defect cured, as the case may be, and thereafter cause
each such Assignment to be duly recorded. In the event that any Mortgage Note is
endorsed in blank as of the Closing Date, promptly following the Closing Date
the Seller shall cause the Servicer to cause to be completed such endorsements
in the following form: "Pay to the order of U.S. Bank National Association, as
Trustee under the Pooling and Servicing Agreement, dated as of August 1, 2004,
among Credit-Based Asset Servicing and Securitization LLC, ▇▇▇▇▇▇▇ ▇▇▇▇▇
Mortgage Investors, Inc., ▇▇▇▇▇▇ Loan Servicing LP and U.S. Bank National
Association, C-BASS Mortgage Loan Asset-Backed Certificates, Series 2004-CB6,
without recourse."
Section 2.03 Payment of Purchase Price for the Mortgage Loans. In
consideration of the sale of the Mortgage Loans from the Seller to the Purchaser
on the Closing Date, the Purchaser agrees to pay to the Seller on the Closing
Date by transfer of immediately available funds, as directed by the Seller, an
amount equal to $[_________] in respect of the Mortgage Loans (the "Purchase
Price"), net of an expense reimbursement amount of $[________] (the "Expense
Reimbursement Amount"), and to transfer to the Seller or its designee on the
Closing Date, Class N, Class X, and Residual Certificates (collectively, the
"Private Certificates"). The Expense Reimbursement Amount shall reimburse the
Purchaser for the Purchaser's Securities and Exchange Commission registration
statement fees and the Purchaser's registration statement administration fees
allocable to the Trust. In addition to the Expense Reimbursement Amount, the
Seller shall pay, and be billed directly for, all reasonable expenses incurred
by the Purchaser in connection with the issuance of the Certificates, including,
without limitation, printing fees incurred in connection with the prospectus
relating to the Certificates, blue sky registration fees and expenses, fees and
reasonable expenses of Purchaser's counsel, fees of the rating agencies
requested to rate the Certificates, accountant's fees and expenses and the fees
and expenses of the Trustee and the Certificate Insurer and other out of pocket
costs, if any. If the Purchaser shall determine that the Expense Reimbursement
Amount is not sufficient to reimburse the Purchaser for all reasonable expenses
incurred by it that are subject to reimbursement by the Seller hereunder as
described above, the Seller shall promptly reimburse the Purchaser for such
additional amounts upon written notice by the Purchaser to the Seller.
ARTICLE III
REPRESENTATIONS AND WARRANTIES; REMEDIES FOR BREACH
Section 3.01 Seller Representations and Warranties Relating to the
Mortgage Loans. The Seller hereby represents and warrants to the Purchaser, with
respect to the Mortgage Loans, that as of the Closing Date or as of such date
specifically provided herein:
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(a) The information set forth in the Mortgage Loan Schedule is
complete, true and correct as of the Cut off Date.
(b) There are no delinquent taxes, ground rents, water charges,
sewer rents, assessments, including assessments payable in future installments,
or other outstanding charges affecting the related Mortgaged Property.
(c) The terms of the Mortgage Note and the Mortgage have not been
impaired, waived, altered or modified in any respect, except by written
instruments, recorded in the applicable public recording office if necessary to
maintain the lien priority of the Mortgage and the interests of the
Certificateholders, and which have been delivered to the Trustee; the substance
of any such waiver, alteration or modification has been approved by the title
insurer, to the extent required by the related policy, and is reflected on the
Mortgage Loan Schedule. No instrument of waiver, alteration or modification has
been executed, and no Mortgagor has been released, in whole or in part, except,
in connection with an assumption agreement approved by the title insurer, to the
extent required by the policy and, in the case of an FHA Loan, to the extent
required by the related Insurance Agreement, and which assumption agreement has
been delivered to the Trustee and the terms of which are reflected in the
Mortgage Loan Schedule.
(d) The Mortgage Note and the Mortgage are not subject to any
right of rescission, set off, counterclaim or defense, including the defense of
usury, nor will the operation of any of the terms of the Mortgage Note and the
Mortgage, or the exercise of any right thereunder, render the Mortgage
unenforceable, in whole or in part, or subject to any right of rescission, set
off, counterclaim or defense, including the defense of usury and no such right
of rescission, set off, counterclaim or defense has been asserted with respect
thereto.
(e) All buildings upon the Mortgaged Property are insured by a
generally acceptable insurer against loss by fire, hazards of extended coverage
and such other hazards as are customary in the area where the Mortgaged Property
is located, pursuant to insurance policies conforming to the requirements of the
Pooling and Servicing Agreement. All such insurance policies contain a standard
mortgagee clause naming the Seller, its successors and assigns as mortgagee and
all premiums thereon have been paid. If upon origination of the Mortgage Loan,
the Mortgaged Property was in an area identified on a Flood Hazard Map or Flood
Insurance Rate Map issued by the Federal Emergency Management Agency as having
special flood hazards (and such flood insurance has been made available) a flood
insurance policy meeting the requirements of the current guidelines of the
Federal Insurance Administration is in effect which policy conforms to the
requirements of the Federal National Mortgage Association ("FNMA") and the
Federal Home Loan Mortgage Corporation ("FHLMC"). The Mortgage obligates the
Mortgagor thereunder to maintain all such insurance at the Mortgagor's cost and
expense, and on the Mortgagor's failure to do so, authorizes the holder of the
Mortgage to maintain such insurance at the Mortgagor's cost and expense and to
seek reimbursement therefor from the Mortgagor. All acts required to be
performed to preserve the rights and remedies of the Trustee in any such
insurance policies have been performed, including, without limitation, any
necessary notifications of insurers and assignments of policies or interests
therein.
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(f) Any and all requirements of any federal, state or local law,
including, without limitation, usury, truth-in-lending, predatory or abusive
lending laws, real estate settlement procedures, consumer credit protection,
equal credit opportunity or disclosure laws applicable to the origination and
servicing of the Mortgage Loans have been complied with.
(g) The Mortgage has not been satisfied, canceled, subordinated
(other than with respect to second lien loans, the subordination to the first
lien loan) rescinded, in whole or in part, and the Mortgaged Property has not
been released from the lien of the Mortgage, in whole or in part, nor has any
instrument been executed that would effect any such satisfaction, cancellation,
subordination, rescission or release.
(h) The Mortgage is a valid, existing and enforceable first or
second lien on the Mortgaged Property, including all improvements on the
Mortgaged Property subject only to (1) the lien of current real property taxes
and assessments not yet due and payable, (2) covenants, conditions and
restrictions, rights of way, easements and other matters of the public record as
of the date of recording being acceptable to mortgage lending institutions
generally and, in the case of FHA Loans, to the FHA, and in the case of the VA
Loans to the VA and specifically referred to in the lender's title insurance
policy delivered to the originator of the Mortgage Loan, (3) other matters to
which like properties are commonly subject which do not materially interfere
with the benefits of the security intended to be provided by the Mortgage or the
use, enjoyment, value or marketability of the related Mortgaged Property and
which may not in any way prevent realization of the benefits of the related
Insurance Agreement, if applicable and (4) with respect to any second lien
mortgage loan, the lien of the related first mortgage loan. Any security
agreement, chattel mortgage or equivalent document related to and delivered in
connection with the Mortgage Loan establishes and creates a valid, existing and
enforceable first or second lien and first or second priority security interest
on the property described therein and the Seller has full right to sell and
assign the same to the Purchaser.
(i) The Mortgage Note and the related Mortgage are genuine and
each is the legal, valid and binding obligation of the maker thereof,
enforceable in accordance with its terms. No more than 2.0% of the Mortgage
Loans by Cut-off Date Principal Balance are evidenced by lost note affidavits
due to missing original Mortgage Notes.
(j) The proceeds of the Mortgage Loan have been fully disbursed to
or for the account of the Mortgagor and there is no obligation for the mortgagee
to advance additional funds thereunder and any and all requirements as to
completion of any on site or off site improvement and as to disbursements of any
escrow funds therefor have been complied with. All costs, fees and expenses
incurred in making or closing the Mortgage Loan and the recording of the
Mortgage have been paid, and the Mortgagor is not entitled to any refund of any
amounts paid or due to the mortgagee pursuant to the Mortgage Note or Mortgage.
(k) Immediately prior to the transfer and assignment contemplated
herein, the Seller was the sole owner and holder of the Mortgage Loans and has
good and marketable title to each Mortgage Loan, free and clear of any and all
liens, pledges, charges, claims, participation interests, mortgages, security
interests or encumbrances or other interests of any nature and has full right
and authority to sell and assign the same.
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(l) Each Mortgage Loan is covered by an ALTA mortgagee title
insurance policy acceptable to FNMA or FHLMC, issued by a title insurer
acceptable to (1) FNMA and FHLMC, in the case of a conventional Mortgage Loan
and (2) the FHA, in the case of an FHA Loan, and qualified to do business in the
jurisdiction where the Mortgaged Property is located, insuring (subject to the
exceptions contained in (h)(1) and (2) above) the Seller, its successors and
assigns as to the first or second priority lien of the Mortgage in the original
principal amount of the Mortgage Loan and against any loss by reason of the
invalidity or unenforceability of the lien resulting from the provisions of the
Mortgage providing for adjustment in the mortgage interest rate and/or monthly
payment including any negative amortization thereunder. Additionally, such
mortgagee title insurance policy affirmatively insures ingress and egress to and
from the Mortgaged Property, and against encroachments by or upon the Mortgaged
Property or any interest therein. The Seller is the sole insured of such
mortgagee title insurance policy, and such lender's title insurance policy is in
full force and effect and will be in full force and effect upon the consummation
of the transactions contemplated by this Agreement. No claims have been made
under such mortgagee title insurance policy, and no prior holder of the related
Mortgage, including the Seller, has done, by act or omission, anything which
would impair the coverage of such mortgagee title insurance policy.
(m) There are no mechanics' or similar liens or claims which have
been filed for work, labor or material (and no rights are outstanding that under
law could give rise to such lien) affecting the related Mortgaged Property which
are or may be liens prior to, or equal or coordinate with, the lien of the
related Mortgage.
(n) The collection practices used by the Servicer with respect to
each Mortgage Note and Mortgage have been in all respects legal, proper, prudent
and customary in the mortgage servicing industry.
(o) The Mortgage and related Mortgage Note contain customary and
enforceable provisions such as to render the rights and remedies of the holder
thereof adequate for the realization against the Mortgaged Property of the
benefits of the security provided thereby, including, (1) in the case of a
Mortgage designated as a deed of trust, by trustee's sale, and (2) otherwise by
judicial foreclosure. There is no homestead or other exemption available to the
Mortgagor which would interfere with the right to sell the Mortgaged Property at
a trustee's sale or the right to foreclose the Mortgage. The Mortgagor has not
notified the Seller and the Seller has no knowledge of any relief requested or
allowed to the Mortgagor under the Soldiers and Sailors Civil Relief Act of
1940, as amended.
(p) The Mortgage Note is not and has not been secured by any
collateral except the lien of the corresponding Mortgage on the Mortgaged
Property and the security interest of any applicable security agreement or
chattel mortgage.
(q) In the event the Mortgage constitutes a deed of trust, a
trustee, duly qualified under applicable law to serve as such, has been properly
designated and currently so serves and is named in the Mortgage, and no fees or
expenses are or will become payable by the Purchaser to the trustee under the
deed of trust, except in connection with a trustee's sale after default by the
Mortgagor.
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(r) No Mortgage Loan contains provisions pursuant to which monthly
payments are (1) paid or partially paid with funds deposited in any separate
account established by the Seller, the Mortgagor, or anyone on behalf of the
Mortgagor, (2) paid by any source other than the Mortgagor or (3) contains any
other similar provisions which may constitute a "buydown" provision. The
Mortgage Loan is not a graduated payment mortgage loan and the Mortgage Loan
does not have a shared appreciation or other contingent interest feature.
(s) The Mortgage Note, the Mortgage, the Assignment and any other
documents required to be delivered with respect to each Mortgage Loan pursuant
to this Agreement have been delivered to the Purchaser or its designee, all in
compliance with the specific requirements of the Pooling and Servicing
Agreement.
(t) If the residential dwelling on the Mortgaged Property is a
condominium unit or a unit in a planned unit development (other than a de
minimis planned unit development) such condominium or planned unit development
project meets FNMA's eligibility requirements.
(u) None of the Mortgage Loans are secured by a leasehold estate
or security that constitutes other than a fee simple interest in real property
under applicable state law.
(v) The rights with respect to each Mortgage Loan are assignable
by the Seller without the consent of any Person other than consents which will
have been obtained on or before the Closing Date.
(w) The Mortgage Loans are not being transferred by the Seller
with any intent to hinder, delay or defraud any creditors of the Seller.
(x) All parties which have had any interest in each Mortgage Loan,
whether as mortgagee, assignee, pledgee or otherwise, and including, without
limitation, the Seller, are (or during the period in which they held and
disposed such interest, were) in compliance with any and all applicable
licensing requirements of the laws of the state wherein the property securing
the Mortgage is located to the extent that any non-compliance thereunder would
affect the value or marketability of the Mortgage Loans.
(y) To the best of Seller's knowledge, the Mortgaged Property is
free from any and all toxic or hazardous substances and there exists no
violation of any local, state or federal environmental law, rule or regulation.
(z) The Mortgaged Property is free from material damage.
(aa) Each Mortgage Loan has been serviced by the Servicer in
accordance with the terms thereof and Applicable Regulations.
(bb) All prepayment penalties included in the transaction are
enforceable and were originated in compliance with all applicable federal, state
and local laws.
(cc) There is no proceeding pending for the total or partial
condemnation and no eminent domain proceedings pending affecting any Mortgaged
Property.
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(dd) There was no fraud involved in the origination of any Mortgage
Loan by the applicable mortgagee or Mortgagor, and to the best of the Seller's
knowledge, there was no fraud by the appraiser or any other party involved in
the origination of any such Mortgage Loan.
(ee) Each mortgage file contains an appraisal of or a broker's
price opinion regarding the related Mortgaged Property indicating an appraised
value equal to the appraised value identified for such Mortgaged Property on the
Mortgage Loan Schedule. Each appraisal has been prepared on FNMA or FHLMC forms.
(ff) No improvements on any Mortgaged Property encroach on
adjoining properties (and in the case of a condominium unit, such improvements
are within the project with respect to that unit), and no improvements on
adjoining properties encroach upon such Mortgaged Property unless there exists
in the applicable Mortgage File a title policy with endorsements which insure
against losses sustained by the insured as a result of such encroachments.
(gg) Each Insurance Agreement is in full force and effect and will
be in full force and effect upon the consummation of the transactions
contemplated by this Agreement.
(hh) With respect to escrow deposits, if any, all such payments are
in the possession of, or under the control of, the Servicer and there exists no
deficiencies in connection therewith for which customary arrangements for
repayment thereof have not been made. No escrow deposits or escrow advances or
other charges or payments due the Servicer have been capitalized under any
Mortgage or the related Note.
(ii) No Mortgage Loan, other than a Bankruptcy Plan Mortgage Loan,
is subject to any pending bankruptcy or insolvency proceeding. To the Seller's
best knowledge, no material litigation or lawsuit relating to any Mortgage Loan
is pending.
(jj) The Seller used no selection procedures that identified the
Mortgage Loans as being less desirable or valuable than other comparable
mortgage loans acquired by the Seller.
(kk) The sale, transfer, assignment and conveyance of Mortgage
Loans by the Seller pursuant to this Agreement will not result in any tax, fee
or governmental charge (other than income taxes and related taxes) payable by
the Seller, the Depositor or the Trustee to any federal, state or local
government other than taxes which have or will be paid by the Seller as due
("Transfer Taxes"). In the event that the Depositor or the Trustee receives
actual notice of any Transfer Taxes arising out of the transfer, assignment and
conveyance of the Mortgage Loans, other than any taxes to be paid by the Seller,
on written demand by the Depositor, or the Trustee, or upon the Seller's
otherwise being given notice thereof by the Depositor or the Trustee, the Seller
shall pay, and otherwise indemnify and hold the Depositor and the Trustee
harmless, on an after tax basis, from and against any and all such Transfer
Taxes (it being understood that the Certificateholders, the Trustee and the
Depositor shall have no obligation to pay such Transfer Taxes).
(ll) With respect to the Mortgage Loans, the Mortgaged Properties
securing repayment of the related Mortgage Note, consists of a fee simple
interest in a single parcel or two
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contiguous parcels of real property improved by a (A) detached or semi-detached
one family dwelling, (B) detached or semi-detached two to-four-family dwelling,
(C) one family unit in a FNMA eligible condominium project, (D) detached or
semi-detached one family dwelling in a planned unit development which is not a
co-operative, (E) multi family dwelling or townhouse or (F) mobile home or
manufactured dwelling which constitutes real property.
(mm) There is no default, breach, violation or event of
acceleration existing under the Mortgage or the Mortgage Note and no event
which, with the passage of time or with notice and the expiration of any grace
or cure period, would constitute a default, breach, violation or event of
acceleration, and the Seller has not waived any default, breach, violation or
event of acceleration except, in the case of an FHA Loan, by written
instruments, and the substance of which waiver has been approved by the FHA, to
the extent required by the applicable Insurance Agreement.
(nn) The Seller has no actual knowledge that with respect to any
Mortgage Loan (1) the Servicer has sent a notice of default to the related
Mortgagor which the Servicer is currently seeking to enforce, or (2) any
foreclosure proceedings have been commenced or acceleration been declared which
is currently pending. The Seller is not transferring any Mortgage Loan to the
Purchaser with the intention or knowledge that the Purchaser or the Trust will
acquire the related Mortgaged Property.
(oo) With respect to any Mortgage Loan that is secured by a second
lien on the related Mortgaged Property, either (i) no consent for the Mortgage
Loan is required by the holder of any related senior lien or (ii) such consent
has been obtained and is contained in the Mortgage File.
(pp) In any case in which a Mortgage Loan is secured by a second
lien and a senior lien on the related Mortgaged Property provides for negative
amortization or deferred interest, the balance of such senior lien on the
related Mortgaged Property used to calculate the Combined Loan-to-Value Ratio
for the Mortgage Loan is based on the maximum amount of negative amortization
possible under such senior lien.
(qq) With respect to a Mortgage Loan which is a second lien, as of
the date hereof, the Seller has not received a notice of default of a senior
lien on the related Mortgaged Property which has not been cured.
(rr) As of August 1, 2004, no Mortgage Loan is delinquent (other
than Mortgage Loans subject to a bankruptcy plan or forbearance plan). The
Seller has not waived any default, breach, violation or event of acceleration,
and the Seller has not taken any action to waive any default, breach, violation
or event of acceleration, with respect to any Mortgage Loan.
(ss) Each Mortgage Loan is a "qualified Mortgage" within the
meaning of Section 860 G(a)(3) of the Code.
(tt) With respect to any Mortgage Loan which provides for an
adjustable interest rate, all rate adjustments have been performed in accordance
with the terms of the related Mortgage Note or subsequent modifications, if any.
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(uu) At the time of their origination, all FHA Loans conformed to
HUD origination guidelines.
(vv) Each Mortgage Loan is directly secured by a Mortgage on a
residential property, and either (1) substantially all of the proceeds of the
Mortgage Loan were used to acquire, improve or protect the portion of the
residential property that consists of an interest in real property (within the
meaning of Treasury Regulations Sections 1.856 3(c) and 1.856 3(d)) and the
interest in real property was the only security for the Mortgage Loan as of the
Testing Date (as defined below), or (2) the fair market value of the interest in
real property which secures the Mortgage Loan was at least equal to 80% of the
principal amount of the Mortgage Loan (a) as of the Testing Date, or (b) as of
the Closing Date. For purposes of the previous sentence, (1) the fair market
value of the referenced interest in real property shall first be reduced by (a)
the amount of any lien on the interest in real property that is senior to the
Mortgage Loan, and (b) a proportionate amount of any lien on the interest in
real property that is on a parity with the Mortgage Loan, and (2) the "Testing
Date" shall be the date on which the referenced Mortgage Loan was originated
unless (a) the Mortgage Loan was modified after the date of its origination in a
manner that would cause "significant modification" of the Mortgage Loan within
the meaning of Treasury Regulations Section 1.1001 3, and (b) the "significant
modification" did not occur at a time when the Mortgage Loan was in default or
when default with respect to the Mortgage Loan was reasonably foreseeable, in
which case the "Testing Date" shall be the date on which the referenced Mortgage
Loan was modified after the date of its origination.
(ww) With respect to each Mortgage Loan that is a mobile or
manufactured housing unit, such unit is a "single family residence" within the
meaning of Section 25(e)(10) of the Code. The fair market value of the
manufactured home securing each contract was at least equal to 80% of the
adjusted issue price of the contract at either (i) the time the contract was
originated (determined pursuant to the REMIC Provisions) or (ii) the time the
contract is transferred to the purchaser. Each contract is a "qualified
mortgage" under Section 860G(a)(3) of the Code.
(xx) No Mortgage Loan is covered by the Home Ownership and Equity
Protection Act of 1994 ("HOEPA") and no Mortgage Loan is classified as a high
cost mortgage loan under HOEPA. In addition, no Mortgage Loan is a "high cost
home," "covered," "high risk home" or "predatory" loan under any other
applicable state, federal or local law (or a similarly classified loan using
different terminology under a law imposing heightened regulatory scrutiny or
additional legal liability for residential mortgage loans having high interest
rates, points and/or fees).
(yy) No Mortgage Loan that was originated on or after October 1,
2002 and before March 7, 2003, which is secured by property located in the State
of Georgia. In addition, there is no Mortgage Loan that was originated on or
after March 7, 2003, which is a "high cost home loan" as defined under the
Georgia Fair Lending Act.
(zz) With respect to the Group II Mortgage Loans, no proceeds from
any such Mortgage Loan were used to finance single-premium credit insurance
policies.
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(aaa) No Mortgage Loan originated on or after October 1, 2002 will
impose a prepayment premium for a term in excess of three years. Any such
Mortgage Loans originated prior to such date will not impose prepayment
penalties in excess of five years.
(bbb) The Servicer has fully furnished, 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 (three of the
credit repositories), on a monthly basis.
(ccc) [Reserved].
(ddd) With respect to the Prepayment Penalty Schedule, as of the
Closing Date, each prepayment penalty is permissible and enforceable in
accordance with its terms under applicable state law, except as the
enforceability thereof is limited due to acceleration in connection with a
foreclosure or other involuntary payment.
(eee) Any written agreement between the Mortgagor in respect of a
Mortgage Loan and the Servicer modifying such Mortgagor's obligation to make
payments under the Mortgage Loan (such modified Mortgage Loan, a "Modified
Mortgage Loan") was done in accordance with the terms of the Pooling and
Servicing Agreement.
(fff) No Mortgage Loan is a "high cost" or a "covered" loan or any
other similarly designated loan as defined under any state, local or federal
law, which law contains provisions which may result in liability to the
purchaser or assignee of such loan.
(ggg) As of the Closing Date, no Mortgage Loan is the subject of
pending or final foreclosure proceedings or a bankruptcy or similar proceeding.
(hhh) As of the Closing Date, the Seller would not, applying its
ordinary servicing standards, initiate foreclosure proceedings with respect to
any Mortgage Loan based on such Mortgage Loan's delinquency status prior to the
next scheduled payment date for such Mortgage Loan.
(iii) As of the Closing Date, no Mortgage Loan provides for interest
other than at either (i) a single fixed rate in effect throughout the term of
the Mortgage Loan or (ii) a "variable rate" (within the meaning of Treasury
Regulations Section 1.860G-1(a)(3)) in effect throughout the term of the
Mortgage Loan.
(jjj) As of the Closing Date, no Mortgage Loan is either (i) a
"High-Cost Home Loan" as defined in the New Jersey Home Ownership Act effective
November 27, 2003 or (ii) a "High-Cost Home Loan" as defined in the New Mexico
Home Loan Protection Act effective January 1, 2004.
(kkk) No Mortgage Loan is a High Cost Loan or a Covered Loan, as
applicable (as such terms are defined in Appendix E of the Standard & Poor's
Glossary For File Format For LEVELS(R) Version 5.6 Revised (attached hereto as
Exhibit 1); provided that no representation and warranty is made in this clause
3.01(kkk) with respect to any Mortgage Loan secured by property located in the
states of Kansas or West Virginia.
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With respect to the representations and warranties set forth in this
Section 3.01 that are made to the best of the Seller's knowledge or as to which
the Seller has no knowledge, if it is discovered by the Depositor, the Seller,
the Servicer or the Trustee, as set forth in Section 2.04 of the Pooling and
Servicing Agreement, that the substance of such representation and warranty is
inaccurate and such inaccuracy materially and adversely affects the value of the
related Mortgage Loan or the interest therein of the Purchaser or the
Purchaser's assignee, transferee or designee for the benefit of the
Certificateholders then, notwithstanding the Seller's lack of knowledge with
respect to the substance of such representation and warranty being inaccurate at
the time the representation or warranty was made, such inaccuracy shall be
deemed a breach of the applicable representation or warranty.
Upon discovery by the Depositor, the Seller, the Servicer, the
Purchaser or any assignee, transferee or designee of the Purchaser of a breach
of any of the representations and warranties contained in this Article III or
Section 2.04 of the Pooling and Servicing Agreement that materially and
adversely affects the value of any Mortgage Loan or the interest therein of the
Purchaser or the Purchaser's assignee, transferee or designee for the benefit of
the Certificate Insurer or the Certificateholders, the party discovering the
breach shall give prompt written notice to the others and in no event later than
two Business Days from the date of such discovery. Within 90 days of the earlier
of its discovery or its receipt of notice of any such breach of a representation
or warranty, the Seller shall promptly cure such breach in all material
respects, or in the event such defect or breach cannot be cured, the Seller
shall repurchase the affected Mortgage Loan or cause the removal of such
Mortgage Loan from the Trust Fund and substitute for it one or more Eligible
Substitute Mortgage Loans, in either case, in accordance with Section 2.03 of
the Pooling and Servicing Agreement.
Upon discovery or receipt of written notice by the Seller of any
materially defective document in, or that a document is missing from, a Mortgage
File, the Seller shall have 120 days to cure such defect or 150 days following
the Closing Date, in the case of missing Mortgages or Assignments (or within 90
days of the earlier of the Seller's discovery or receipt of notification if such
defect would cause the Mortgage Loan not to be a "qualified mortgage" for REMIC
purposes), or in the event such defect cannot be cured, the Seller shall
repurchase the affected Mortgage Loan or cause the removal of such Mortgage Loan
from the Trust Fund and substitute for it one or more Eligible Substitute
Mortgage Loans, in either case, within such time periods and in accordance with
Section 2.03 of the Pooling and Servicing Agreement.
It is understood and agreed that the representations and warranties
set forth in this Section 3.01 shall survive delivery of the respective Mortgage
Files to the Trustee or its agent, on behalf of the Purchaser and shall inure to
the benefit of the Certificateholders notwithstanding any restrictive or
qualified endorsement or assignment.
It is understood and agreed that the obligations of the Seller set
forth in this Section 3.01 to cure, repurchase or substitute for a defective
Mortgage Loan constitute the sole remedies of the Purchaser, the
Certificateholders or the Trustee on their behalf respecting a missing or
defective document or a breach of the representations or warranties contained in
this Section 3.01.
Section 3.02 Seller Representations and Warranties. The Seller hereby
represents and
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warrants to the Purchaser that as of the Closing Date or as of such date
specifically provided herein:
(i) The Seller is duly organized, validly existing and in good
standing as a limited liability company under the laws of the State of Delaware
and has the power and authority to own its assets and to transact the business
in which it is currently engaged. The Seller is duly qualified to do business
and is in good standing in each jurisdiction in which the character of the
business transacted by it or properties owned or leased by it requires such
qualification and in which the failure to so qualify would have a material
adverse effect on (a) its business, properties, assets or condition (financial
or other), (b) the performance of its obligations under this Agreement, (c) the
value or marketability of the Mortgage Loans or (d) its ability to foreclose on
the related Mortgaged Properties.
(ii) The Seller has the power and authority to make, execute,
deliver and perform this Agreement and to consummate all of the transactions
contemplated hereunder and has taken all necessary action to authorize the
execution, delivery and performance of this Agreement. When executed and
delivered, this Agreement will constitute the Seller's legal, valid and binding
obligations enforceable in accordance with its terms, except as enforcement of
such terms may be limited by (1) bankruptcy, insolvency, reorganization,
receivership, moratorium or similar laws affecting the enforcement of creditors'
rights generally and by the availability of equitable remedies, (2) general
equity principles (regardless of whether such enforcement is considered in a
proceeding in equity or at law) or (3) public policy considerations underlying
the securities laws, to the extent that such policy considerations limit the
enforceability of the provisions of this Agreement which purport to provide
indemnification from securities laws liabilities.
(iii) The Seller holds all necessary licenses, certificates
and permits from all governmental authorities necessary for conducting its
business as it is presently conducted, except for such licenses, certificates
and permits the absence of which, individually or in the aggregate, would not
have a material adverse effect on the ability of the Seller to conduct its
business as it is presently conducted. It is not required to obtain the consent
of any other party or any consent, license, approval or authorization from, or
registration or declaration with, any governmental authority, bureau or agency
in connection with the execution, delivery, performance, validity or
enforceability of this Agreement, except for such consents, licenses, approvals
or authorizations, or registrations or declarations as shall have been obtained
or filed, as the case may be, prior to the Closing Date.
(iv) The execution, delivery and performance of this Agreement
by the Seller will not conflict with or result in a breach of, or constitute a
default under, any provision of any existing law or regulation or any order or
decree of any court applicable to the Seller or any of its properties or any
provision of its Limited Liability Company Agreement, or constitute a material
breach of, or result in the creation or imposition of any lien, charge or
encumbrance upon any of its properties pursuant to any mortgage, indenture,
contract or other agreement to which it is a party or by which it may be bound.
(v) No certificate of an officer, written statement or report
delivered pursuant to the terms hereof by the Seller contains any untrue
statement of a material fact or
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omits to state any material fact necessary to make the certificate, statement or
report not misleading.
(vi) The transactions contemplated by this Agreement are in
the ordinary course of the Seller's business.
(vii) The Seller is not insolvent, nor will the Seller be made
insolvent by the transfer of the Mortgage Loans, nor is the Seller aware of any
pending insolvency.
(viii) The Seller is not in violation of, and the execution
and delivery of this Agreement by it and its performance and compliance with the
terms of this Agreement will not constitute a violation with respect to any
order or decree of any court, or any order or regulation of any federal, state,
municipal or governmental agency having jurisdiction, which violation would
materially and adversely affect the Seller's condition (financial or otherwise)
or operations or any of the Seller's properties, or materially and adversely
affect the performance of any of its duties hereunder.
(ix) There are no actions or proceedings against, or
investigations of, the Seller pending or, to its knowledge, threatened, before
any court, administrative agency or other tribunal (i) that, if determined
adversely, would prohibit the Seller from entering into this Agreement and the
Pooling and Servicing Agreement, (ii) seeking to prevent the consummation of any
of the transactions contemplated by this Agreement or (iii) that, if determined
adversely, would prohibit or materially and adversely affect the Seller's
performance of any of its respective obligations under, or the validity or
enforceability of, this Agreement and the Pooling and Servicing Agreement.
(x) The Seller is not transferring the Mortgage Loans to the
Purchaser hereunder with any intent to hinder, delay or defraud any of its
creditors.
(xi) The Seller acquired title to the Mortgage Loans in good
faith, without notice of any adverse claims.
(xii) The transfer, assignment and conveyance of the Mortgage
Notes and the Mortgages by the Seller pursuant to this Agreement are not subject
to the bulk transfer laws or any similar statutory provisions in effect in any
applicable jurisdiction.
(xiii) The Seller understands that (a) the Private
Certificates have not been and will not be registered or qualified under the
Securities Act of 1933, as amended (the "Securities Act") or any state
securities law, (b) the Purchaser is not required to so register or qualify the
Private Certificates, (c) the Private 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 Private Certificates and (e) the Private
Certificates will bear a legend to the foregoing effect.
(xiv) The Seller is acquiring the Private 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 Securities
Act or any applicable state securities laws.
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(xv) The Seller 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 Private Certificates, such that it is capable of evaluating the
merits and risks of investment in the Private 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 Securities Act.
(xvi) The Seller has been furnished with such information
concerning the Private Certificates and the Purchaser as has been requested by
the Seller from the Purchaser and is relevant to the Seller's decision to
purchase the Private Certificates. The Seller has had any questions arising from
such review answered by the Purchaser or the Seller to the satisfaction of the
Seller.
(xvii) The Seller 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 Private Certificate, any interest in any Private
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 Private Certificate, any interest in any Private Certificate or any other
similar security from any person in any manner, (c) otherwise approach or
negotiate with respect to any Private Certificate, any interest in any Private
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 (d) above)
would constitute a distribution of any Private Certificate under the Securities
Act, that would render the disposition of any Private Certificate a violation of
Section 5 of the Securities Act or any state securities law, or that would
require registration or qualification pursuant thereto. The Seller will not sell
or otherwise transfer any of the Private Certificates, except in compliance with
the provisions of the Pooling and Servicing Agreement.
(xviii) The Seller is not an employee benefit plan or other
retirement arrangement subject to the Employee Retirement Income Security Act of
1974, as amended ("ERISA"), or Section 4975 of the Internal Revenue Code of
1986, as amended (the "Code"), (collectively, an "ERISA Plan"), and is not
acting on behalf of, as named fiduciary of, as trustee of, or investing the
assets of an ERISA Plan.
ARTICLE IV
SELLER'S COVENANTS
Section 4.01 Covenants of the Seller.
(a) The Seller hereby covenants that except for the transfer
hereunder, the Seller will not sell, pledge, assign or transfer to any other
Person, or grant, create, incur, assume or suffer to exist any lien on any
Mortgage Loan, or any interest therein; the Seller will notify the Trustee, as
assignee of the Purchaser, of the existence of any lien on any Mortgage Loan
immediately upon discovery thereof, and the Seller will defend the right, title
and interest of the Trust, as assignee of the Purchaser, in, to and under the
Mortgage Loans, against all claims of third parties claiming through or under
the Seller; provided, however, that nothing in this Section 4.01 shall prevent
or be deemed to prohibit the Seller from suffering to exist upon any of the
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Mortgage Loans any liens for municipal or other local taxes and other
governmental charges if such taxes or governmental charges shall not at the time
be due and payable or if the Seller shall currently be contesting the validity
thereof in good faith by appropriate proceedings and shall have set aside on its
books adequate reserves with respect thereto.
(b) The Seller hereby covenants that neither it nor any affiliate
of the Seller will directly solicit any Mortgagor hereunder to refinance the
related Mortgage Loan. For the purposes of the foregoing, neither the Seller nor
any affiliate of the Seller shall be deemed to directly solicit any Mortgagor if
the Seller responds to a request from a Mortgagor regarding a refinancing or if
the Mortgagor receives marketing materials which are generally disseminated.
(c) On the Closing Date, counsel for the Seller shall deliver an
opinion to the Purchaser and the Underwriters as to certain corporate matters
and as to the characterization of the transfer of the Mortgage Loans from the
Seller to the Purchaser.
ARTICLE V
OPTIONAL PURCHASE OF DEFAULTED MORTGAGE LOANS
(a) On or after September 30, 2004, as to any Mortgage Loan which
is Delinquent in payment by 120 days or more or any REO Property, an Affiliate
of the Seller may, at its option, purchase such Mortgage Loan from the Trust
Fund at the Purchase Price for such Mortgage Loan provided that an Affiliate of
the Seller may exercise the purchase right during the period commencing on the
first day of the calendar quarter succeeding the calendar quarter in which the
Initial Delinquency Date occurred and ending on the last Business Day of such
calendar quarter. The "Initial Delinquency Date" of a Mortgage Loan shall mean
the date on which the Mortgage Loan first became 120 days Delinquent.
(b) If an Affiliate of the Seller does not exercise the purchase
right with respect to a Mortgage Loan during the period specified in the
preceding paragraph, such Mortgage Loan shall thereafter again become eligible
for purchase pursuant to the preceding paragraph only after the Mortgage Loan
ceases to be 120 days or more Delinquent and thereafter becomes 120 days
Delinquent again.
ARTICLE VI
TERMINATION
Section 6.01 Termination. The respective obligations and responsibilities
of the Seller and the Purchaser created hereby shall terminate upon the
termination of the Trust as provided in Section 8.01 of the Trust Agreement.
ARTICLE VII
MISCELLANEOUS PROVISIONS
Section 7.01 Amendment. This Agreement may be amended from time to time by
the Seller and the Purchaser, by written agreement signed by the Seller and the
Purchaser.
Section 7.02 Governing Law. This Agreement shall be governed by and
construed in accordance with the laws of the State of New York and the
obligations, rights and remedies of
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the parties hereunder shall be determined in accordance with such laws.
Section 7.03 Notices. All demands, notices and communications hereunder
shall be in writing and shall be deemed to have been duly given if personally
delivered at or mailed by registered mail, postage prepaid, addressed as
follows:
if to the Seller:
Credit Based Asset Servicing and Securitization LLC
▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇ ▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇
Attention: General Counsel
or such other address as may hereafter be furnished to the Purchaser in writing
by the Seller.
if to the Purchaser:
▇▇▇▇▇▇▇ ▇▇▇▇▇ Mortgage Investors, Inc.
▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇
4 World Financial ▇▇▇▇▇▇, ▇▇▇▇ ▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇
Attention: Asset-Backed Finance
or such other address as may hereafter be furnished to the Seller in writing by
the Purchaser.
Section 7.04 Severability of Provisions. If any one or more of the
covenants, agreements, provisions or terms of this Agreement shall be held
invalid for any reason whatsoever, 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.
Section 7.05 Counterparts. This Agreement may be executed in one or more
counterparts by the different parties hereto on separate counterparts, each of
which, when so executed, shall be deemed to be an original and such
counterparts, together, shall constitute one and the same agreement.
Section 7.06 Further Agreements. The Purchaser and the Seller each agree
to execute and deliver to the other such additional documents, instruments or
agreements as may be necessary or reasonable and appropriate to effectuate the
purposes of this Agreement or in connection with the issuance of any Series of
Certificates representing interests in the Mortgage Loans.
Without limiting the generality of the foregoing, as a further
inducement for the Purchaser to purchase the Mortgage Loans from the Seller, the
Seller will cooperate with the Purchaser in connection with the sale of any of
the securities representing interests in the Mortgage Loans. In that connection,
the Seller will provide to the Purchaser any and all information and appropriate
verification of information, whether through letters of its auditors
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and counsel or otherwise, as the Purchaser shall reasonably request and will
provide to the Purchaser such additional representations and warranties,
covenants, opinions of counsel, letters from auditors, and certificates of
public officials or officers of the Seller as are reasonably required in
connection with such transactions and the offering of investment grade
securities rated by the Rating Agencies.
Section 7.07 Intention of the Parties. It is the intention of the parties
that the Purchaser is purchasing, and the Seller is selling, the Mortgage Loans
rather than pledging the Mortgage Loans to the Purchaser to secure a loan by the
Purchaser to the Seller. Accordingly, the parties hereto each intend to treat
the transaction for Federal income tax purposes and all other purposes as a sale
by the Seller and a purchase by the Purchaser of the Mortgage Loans. The
Purchaser will have the right to review the Mortgage Loans and the related
Mortgage Files to determine the characteristics of the Mortgage Loans which will
affect the Federal income tax consequences of owning the Mortgage Loans and the
Seller will cooperate with all reasonable requests made by the Purchaser in the
course of such review.
Section 7.08 Successors and Assigns; Assignment of this Agreement. This
Agreement shall bind and inure to the benefit of and be enforceable by the
Seller, the Purchaser and the Trustee. The obligations of the Seller under this
Agreement cannot be assigned or delegated to a third party without the consent
of the Purchaser and which consent shall be at the Purchaser's sole discretion,
except that the Purchaser acknowledges and agrees that the Seller may assign its
obligations hereunder to any Person into which the Seller is merged or any
corporation resulting from any merger, conversion or consolidation to which the
Seller is a party or any Person succeeding to the business of the Seller. The
parties hereto acknowledge that the Purchaser is acquiring the Mortgage Loans
for the purpose of contributing them to a trust that will issue a series of
certificates representing undivided interests in such Mortgage Loans. As an
inducement to the Purchaser to purchase the Mortgage Loans, the Seller
acknowledges and consents to the assignment by the Purchaser to the Trustee of
all of the Purchaser's rights against the Seller pursuant to this Agreement
insofar as such rights relate to Mortgage Loans transferred to the Trustee and
to the enforcement or exercise of any right or remedy against the Seller
pursuant to this Agreement by the Trustee. Such enforcement of a right or remedy
by the Trustee shall have the same force and effect as if the right or remedy
had been enforced or exercised by the Purchaser directly.
Section 7.09 Survival. The representations and warranties set forth in
Sections 3.01 and 3.02 hereof shall survive the purchase of the Mortgage Loans
hereunder.
[SIGNATURE PAGE FOLLOWS]
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IN WITNESS WHEREOF, the Seller and the Purchaser have caused their
names to be signed to this Mortgage Loan Purchase Agreement by their respective
officers thereunto duly authorized as of the day and year first above written.
▇▇▇▇▇▇▇ ▇▇▇▇▇ MORTGAGE
INVESTORS, INC.,
as Purchaser
By:____________________________
Name: ▇▇▇▇▇▇▇ ▇▇▇▇▇▇
Title: President
CREDIT BASED ASSET SERVICING AND
SECURITIZATION LLC,
as Seller
By:____________________________
Name: ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇
Title: Vice President
G-22
SCHEDULE I
MORTGAGE LOAN SCHEDULE
G-23
EXHIBIT H
FORM OF LOST NOTE AFFIDAVIT
Personally appeared before me the undersigned authority to administer
oaths, ______________________ who first being duly sworn deposes and says:
Deponent is ______________________ of ______________________________, successor
by merger to _________________________________________ ("Seller") and who has
personal knowledge of the facts set out in this affidavit.
On ___________________, _________________________ did execute and deliver
a promissory note in the principal amount of $__________.
That said note has been misplaced or lost through causes unknown and is
presently lost and unavailable after diligent search has been made. Seller's
records show that an amount of principal and interest on said note is still
presently outstanding, due, and unpaid, and Seller is still owner and holder in
due course of said lost note.
Seller executes this Affidavit for the purpose of inducing U.S. Bank
National Association, as trustee on behalf of C-BASS Mortgage Loan Asset-Backed
Certificates, Series 2004-CB6 to accept the transfer of the above described loan
from Seller.
Seller agrees to indemnify and hold harmless U.S. Bank National
Association and ▇▇▇▇▇▇▇ ▇▇▇▇▇ Mortgage Investors, Inc. for any losses incurred
by such parties resulting from the above described promissory note having been
lost or misplaced.
By:
STATE OF )
) SS:
COUNTY OF )
On this ____ day of _______ 20__, before me, a Notary Public, in and for
said County and State, appeared ________________________, who acknowledged the
extension of the foregoing and who, having been duly sworn, states that any
representations therein contained are true.
Witness my hand and Notarial Seal this ____ day of _______ 20__.
My commission expires ______________.
H-1
EXHIBIT I
FORM OF ERISA REPRESENTATION
Date
U.S. Bank National Association
Structured Finance
▇▇ ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇-▇▇-▇▇▇▇
▇▇. ▇▇▇▇, ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇-▇▇▇▇
▇▇▇▇▇▇▇ ▇▇▇▇▇ Mortgage Investors, Inc.
4 World Financial ▇▇▇▇▇▇, ▇▇▇▇ ▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇
Re: C-BASS Mortgage Loan Asset-Backed Certificates, Series 2004-CB6
Ladies and Gentlemen:
1. [The undersigned is the ______________________ of (the "Transferee")
a [corporation duly organized] and existing under the laws of __________, on
behalf of which he makes this affidavit.] [The undersigned, ___________________,
is the transferee (the "Transferee").]
2. The Transferee hereby acknowledges that under the terms of the
Pooling and Servicing Agreement (the "Agreement") among ▇▇▇▇▇▇▇ ▇▇▇▇▇ Mortgage
Investors, Inc., as depositor (the "Depositor"), Credit-Based Asset Servicing
and Securitization LLC, as seller, ▇▇▇▇▇▇ Loan Servicing LP, as servicer, and
U.S Bank National Association, as trustee (the "Trustee"), no transfer of the
ERISA-Restricted Certificates shall be permitted to be made to any person unless
the Depositor and the Certificate Registrar (as defined in the Agreement) have
received a certificate from such transferee in the form hereof.
3. The Transferee (i) is not an employee benefit plan or arrangement
subject to Title I of the Employee Retirement Income Security Act of 1974, as
amended ("ERISA"), a plan subject to Section 4975 of the Internal Revenue Code
of 1986, as amended (the "Code") or a plan subject to state, local or other
federal law substantively similar to the foregoing provisions of ERISA or the
Code ("Similar Law") (collectively, a "Plan"), and is not directly or indirectly
acquiring the Certificate for, on behalf of or with any assets of any such Plan,
(ii) (except in the case of a Class R, Class R-X, Class X or Class N
Certificate) is an insurance company that is acquiring the Certificate with
assets of an "insurance company general account" as defined in Section V(e) of
Prohibited Transaction Class Exemption ("PTCE") 95-60 and the acquisition and
holding of the Certificate are covered and exempt under Sections I and III of
PTCE 95-60, or (iii) (except in the case of a Class R or Class R-X Certificate)
solely in the case of a Definitive Certificate, will deliver herewith an Opinion
of Counsel satisfactory to the Trustee and the Certificate Registrar, and upon
which the Trustee and the Certificate Registrar shall be entitled to rely, to
the effect that the acquisition and holding of such Certificate by the
transferee will not result in a nonexempt prohibited transaction under Title I
of ERISA or Section 4975 of the Code,
I-1
or a violation of Similar Law, and will not subject the Certificate Registrar,
the Depositor, the Servicer or the Trustee to any obligation in addition to
those undertaken by such entities in the Pooling and Servicing Agreement, which
Opinion of Counsel shall not be an expense of the Certificate Registrar, the
Depositor, the Servicer or the Trustee.
Capitalized terms used but not defined herein shall have the meanings
ascribed to such terms in the Agreement.
IN WITNESS WHEREOF, the Transferee has executed this certificate.
[Transferee]
By:_____________________________
Name:
Title:
I-2
EXHIBIT J
FORM OF INVESTMENT LETTER [NON-RULE 144A]
[DATE]
▇▇▇▇▇▇▇ ▇▇▇▇▇ Mortgage Investors, Inc.
4 World Financial Center, 10th Floor
New York, New York 10080
U.S. Bank National Association
Structured Finance
▇▇ ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇-▇▇-▇▇▇▇
▇▇. ▇▇▇▇, ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇-▇▇▇▇
Re: C-BASS Mortgage Loan Asset-Backed Certificates, Series 2004-CB6
Ladies and Gentlemen:
In connection with our acquisition of the C-BASS Mortgage Loan
Asset-Backed Certificates, Series 2004-CB6 (the "Certificates"), we certify that
(a) we understand that the Certificates are not being registered under the
Securities Act of 1933, as amended (the "Act"), or any state securities laws and
are being transferred to us in a transaction that is exempt from the
registration requirements of the Act and any such laws, (b) we are an
"accredited investor," as defined in Regulation D under the Act, and have such
knowledge and experience in financial and business matters that we are capable
of evaluating the merits and risks of investments in the Certificates, (c) we
have had the opportunity to ask questions of and receive answers from the
Depositor concerning the purchase of the Certificates and all matters relating
thereto or any additional information deemed necessary to our decision to
purchase the Certificates, (d) we are acquiring the Certificates for investment
for our own account and not with a view to any distribution of such Certificates
(but without prejudice to our right at all times to sell or otherwise dispose of
the Certificates in accordance with clause (g) below), (e) we agree that the
Certificates must be held indefinitely by us and we acknowledge that we are able
to bear the economic risk of investment in the Certificates, (f) we have not
offered or sold any Certificates to, or solicited offers to buy any Certificates
from, any person, or otherwise approached or negotiated with any person with
respect thereto, or taken any other action which would result in a violation of
Section 5 of the Act, (g) we will not sell, transfer or otherwise dispose of any
Certificates unless (1) such sale, transfer or other disposition is made
pursuant to an effective registration statement under the Act or is exempt from
such registration requirements, and if requested, we will at our expense provide
an opinion of counsel satisfactory to the addressees of this Certificate that
such sale, transfer or other disposition may be made pursuant to an exemption
from the Act, (2) the purchaser or transferee of such Certificate has executed
and delivered to you a certificate to substantially the same effect as this
certificate, and (3) the purchaser or transferee has otherwise complied with any
conditions for transfer set forth in the Pooling and Servicing Agreement and (h)
we acknowledge that the Certificates will bear a legend setting forth the
applicable restrictions on transfer.
J-1
Very truly yours,
[NAME OF TRANSFEREE]
By:_______________________
Authorized Officer
J-2
FORM OF RULE 144A INVESTMENT LETTER
[DATE]
▇▇▇▇▇▇▇ ▇▇▇▇▇ Mortgage Investors, Inc.
4 World Financial Center, 10th Floor
New York, New York 10080
U.S. Bank National Association
Structured Finance
▇▇ ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇-▇▇-▇▇▇▇
▇▇. ▇▇▇▇, ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇-▇▇▇▇
Re: C-BASS Mortgage Loan Asset-Backed Certificates, Series 2004-CB6
Ladies and Gentlemen:
In connection with our acquisition of the C-BASS Mortgage Loan
Asset-Backed Certificates, Series 2004-CB6 (the "Certificates"), we certify that
(a) we understand that the Certificates are not being registered under the
Securities Act of 1933, as amended (the "Act"), or any state securities laws and
are being transferred to us in a transaction that is exempt from the
registration requirements of the Act and any such laws, (b) we have had the
opportunity to ask questions of and receive answers from the Depositor
concerning the purchase of the Certificates and all matters relating thereto or
any additional information deemed necessary to our decision to purchase the
Certificates, (c) we have not, nor has anyone acting on our behalf offered,
transferred, pledged, sold or otherwise disposed of the Certificates, any
interest in the Certificates or any other similar security to, or solicited any
offer to buy or accept a transfer, pledge or other disposition of the
Certificates, any interest in the Certificates or any other similar security
from, or otherwise approached or negotiated with respect to the Certificates,
any interest in the Certificates or any other similar security with, any person
in any manner, or made any general solicitation by means of general advertising
or in any other manner, or taken any other action, that would constitute a
distribution of the Certificates under the Securities Act or that would render
the disposition of the Certificates a violation of Section 5 of the Securities
Act or require registration pursuant thereto, nor will act, nor has authorized
or will authorize any person to act, in such manner with respect to the
Certificates, (d) we are a "qualified institutional buyer" as that term is
defined in Rule 144A under the Securities Act and have completed either of the
forms of certification to that effect attached hereto as Annex 1 or Annex 2. We
are aware that the sale to us is being made in reliance on Rule 144A. We are
acquiring the Certificates for our own account or for resale pursuant to Rule
144A and further, understand that such Certificates may be resold, pledged or
transferred only (i) to a person reasonably believed to be a qualified
institutional buyer that purchases for its own account or for the account of a
qualified institutional buyer to whom notice is given that the resale, pledge or
transfer is being made in reliance on Rule 144A, or (ii) pursuant to another
exemption from registration under the Securities Act.
J-3
Very truly yours,
[NAME OF TRANSFEREE]
By:__________________________
Authorized Officer
J-4
ANNEX 1 TO EXHIBIT J
QUALIFIED INSTITUTIONAL BUYER STATUS UNDER SEC RULE 144A
[For Transferees Other Than Registered Investment Companies]
The undersigned (the "Buyer") hereby certifies as follows to the parties
listed in the Rule 144A Transferee Certificate to which this certification
relates with respect to the Certificates described therein:
i. As indicated below, the undersigned is the President, Chief Financial
Officer, Senior Vice President or other executive officer of the Buyer.
ii. In connection with purchases by the Buyer, the Buyer is a "qualified
institutional buyer" as that term is defined in Rule 144A under the Securities
Act of 1933, as amended ("Rule 144A") because (i) the Buyer owned and/or
invested on a discretionary basis $_____(1) in securities (except for the
excluded securities referred to below) as of the end of the Buyer's most recent
fiscal year (such amount being calculated in accordance with Rule 144A and (ii)
the Buyer satisfies the criteria in the category marked below.
___ Corporation, etc. The Buyer is a corporation (other than a bank,
savings and loan association or similar institution), Massachusetts
or similar business trust, partnership, or charitable organization
described in Section 501(c)(3) of the Internal Revenue Code of 1986,
as amended.
___ Bank. The Buyer (a) is a national bank or banking institution
organized under the laws of any State, territory or the District of
Columbia, the business of which is substantially confined to banking
and is supervised by the State or territorial banking commission or
similar official or is a foreign bank or equivalent institution, and
(b) has an audited net worth of at least $25,000,000 as demonstrated
in its latest annual financial statements, a copy of which is
attached hereto.
___ Savings and Loan. The Buyer (a) is a savings and loan
association, building and loan association, cooperative bank,
homestead association or similar institution, which is supervised
and examined by a State or Federal authority having supervision over
any such institutions or is a foreign savings and loan association
or equivalent institution and (b) has an audited net worth of at
least $25,000,000 as demonstrated in its latest annual financial
statements, a copy of which is attached hereto.
---------------------------
(1) Buyer must own and/or invest on a discretionary basis at least $______ in
securities unless Buyer is a dealer, and, in that case, Buyer must own
and/or invest on a discretionary basis at least $______ in securities.
J-5
___ Broker-dealer. The Buyer is a dealer registered pursuant to
Section 15 of the Securities Exchange Act of 1934.
___ Insurance Company. The Buyer is an insurance company whose
primary and predominant business activity is the writing of
insurance or the reinsuring of risks underwritten by insurance
companies and which is subject to supervision by the insurance
commissioner or a similar official or agency of a State, territory
or the District of Columbia.
___ State or Local Plan. The Buyer is a plan established and
maintained by a State, its political subdivisions, or any agency or
instrumentality of the State or its political subdivisions, for the
benefit of its employees.
___ ERISA Plan. The Buyer is an employee benefit plan within the
meaning of Title I of the Employee Retirement Income Security Act of
1974.
___ Investment Advisor. The Buyer is an investment advisor
registered under the Investment Advisors Act of 1940.
___ Small Business Investment Company. Buyer is a small business
investment company licensed by the U.S. Small Business
Administration under Section 301(c) or (d) of the Small Business
Investment Act of 1958.
___ Business Development Company. Buyer is a business development
company as defined in Section 202(a)(22) of the Investment Advisors
Act of 1940.
iii. The term "securities" as used herein does not include (i) securities
of issuers that are affiliated with the Buyer, (ii) securities that are part of
an unsold allotment to or subscription by the Buyer, if the Buyer is a dealer,
(iii) securities issued or guaranteed by the U.S. or any instrumentality
thereof, (iv) bank deposit notes and certificates of deposit, (v) loan
participations, (vi) repurchase agreements, (vii) securities owned but subject
to a repurchase agreement and (viii) currency, interest rate and commodity
swaps.
iv. For purposes of determining the aggregate amount of securities owned
and/or invested on a discretionary basis by the Buyer, the Buyer used the cost
of such securities to the Buyer and did not include any of the securities
referred to in the preceding paragraph, except (i) where the Buyer reports its
securities holdings in its financial statements on the basis of their market
value, and (ii) no current information with respect to the cost of those
securities has been published. If clause (ii) in the preceding sentence applies,
the securities may be valued at market. Further, in determining such aggregate
amount, the Buyer may have included securities owned by subsidiaries of the
Buyer, but only if such subsidiaries are consolidated with the Buyer in its
financial statements prepared in accordance with generally accepted accounting
principles and if the investments of such subsidiaries are managed under the
Buyer's direction. However, such securities were not included if the Buyer is a
majority-owned, consolidated subsidiary of another enterprise and the Buyer is
not itself a reporting company under the Securities Exchange Act of 1934, as
amended.
J-6
v. The Buyer acknowledges that it is familiar with Rule 144A and
understands that the seller to it and other parties related to the Certificates
are relying and will continue to rely on the statements made herein because one
or more sales to the Buyer may be in reliance on Rule 144A.
J-7
vi. Until the date of purchase of the Rule 144A Securities, the Buyer will
notify each of the parties to which this certification is made of any changes in
the information and conclusions herein. Until such notice is given, the Buyer's
purchase of the Certificates will constitute a reaffirmation of this
certification as of the date of such purchase. In addition, if the Buyer is a
bank or savings and loan is provided above, the Buyer agrees that it will
furnish to such parties updated annual financial statements promptly after they
become available.
Print Name of Buyer
By:_______________________
Name:
Title:
Date:_____________________
J-8
ANNEX 2 TO EXHIBIT J
QUALIFIED INSTITUTIONAL BUYER STATUS UNDER SEC RULE 144A
[For Transferees That are Registered Investment Companies]
The undersigned (the "Buyer") hereby certifies as follows to the parties
listed in the Rule 144A Transferee Certificate to which this certification
relates with respect to the Certificates described therein:
1. As indicated below, the undersigned is the President, Chief Financial
Officer or Senior Vice President of the Buyer or, if the Buyer is a "qualified
institutional buyer" as that term is defined in Rule 144A under the Securities
Act of 1933, as amended ("Rule 144A") because Buyer is part of a Family of
Investment Companies (as defined below), is such an officer of the Adviser.
2. In connection with purchases by Buyer, the Buyer is a "qualified
institutional buyer" as defined in SEC Rule 144A because (i) the Buyer is an
investment company registered under the Investment Company Act of 1940, as
amended and (ii) as marked below, the Buyer alone, or the Buyer's Family of
Investment Companies, owned at least $100,000,000 in securities (other than the
excluded securities referred to below) as of the end of the Buyer's most recent
fiscal year. For purposes of determining the amount of securities owned by the
Buyer or the Buyer's Family of Investment Companies, the cost of such securities
was used, except (i) where the Buyer or the Buyer's Family of Investment
Companies reports its securities holdings in its financial statements on the
basis of their market value, and (ii) no current information with respect to the
cost of those securities has been published. If clause (ii) in the preceding
sentence applies, the securities may be valued at market.
___ The Buyer owned $______ in securities (other than the excluded
securities referred to below) as of the end of the Buyer's most
recent fiscal year (such amount being calculated in accordance with
Rule 144A).
___ The Buyer is part of a Family of Investment Companies which
owned in the aggregate $______ in securities (other than the
excluded securities referred to below) as of the end of the Buyer's
most recent fiscal year (such amount being calculated in accordance
with Rule 144A).
3. The term "Family of Investment Companies" as used herein means two or
more registered investment companies (or series thereof) that have the same
investment adviser or investment advisers that are affiliated (by virtue of
being majority owned subsidiaries of the same parent or because one investment
adviser is a majority owned subsidiary of the other).
4. The term "securities" as used herein does not include (i) securities of
issuers that are affiliated with the Buyer or are part of the Buyer's Family of
Investment Companies, (ii) securities issued or guaranteed by the U.S. or any
instrumentality thereof, (iii) bank deposit notes and certificates of deposit,
(iv) loan participations, (v) repurchase agreements, (vi) securities owned but
subject to a repurchase agreement and (vii) currency, interest rate and
commodity swaps.
J-9
5. The Buyer is familiar with Rule 144A and understands that the parties
listed in the Rule 144A Transferee Certificate to which this certification
relates are relying and will continue to rely on the statements made herein
because one or more sales to the Buyer will be in reliance on Rule 144A. In
addition, the Buyer will only purchase for the Buyer's own account.
6. Until the date of purchase of the Certificates, the undersigned will
notify the parties listed in the Rule 144A Transferee Certificate to which this
certification relates of any changes in the information and conclusions herein.
Until such notice is given, the Buyer's purchase of the Certificates will
constitute a reaffirmation of this certification by the undersigned as of the
date of such purchase.
Print Name of Buyer or Adviser
By:_____________________________
Name:
Title:
IF AN ADVISER:
Print Name of Buyer
Date:__________________________
J-10
EXHIBIT K
FORM OF RESIDUAL CERTIFICATE TRANSFER AFFIDAVIT
C-BASS MORTGAGE LOAN ASSET-BACKED CERTIFICATES, SERIES 2004-CB6
STATE OF )
) ss.:
COUNTY OF )
The undersigned, being first duly sworn, deposes and says as follows:
1. The undersigned is [an officer of] ______________, the proposed
Transferee of an Ownership Interest in a [Class R and/or Class R-X Certificates]
(the "Residual Certificate") issued pursuant to the Pooling and Servicing
Agreement, (the "Agreement"), relating to the above-referenced Certificates,
among ▇▇▇▇▇▇▇ ▇▇▇▇▇ Mortgage Investors, Inc., as depositor, Credit-Based Asset
Servicing and Securitization LLC, as seller, ▇▇▇▇▇▇ Loan Servicing LP, as
servicer, and U.S. Bank National Association, as trustee (the "Trustee").
Capitalized terms used, but not defined herein shall have the meanings ascribed
to such terms in the Agreement. The Transferee has authorized the undersigned to
make this affidavit on behalf of the Transferee.
2. The Transferee is, as of the date hereof, and will be, as of the date
of the transfer, a Permitted Transferee. The Transferee is acquiring the
Residual Certificate either (i) for its own account or (ii) as nominee, trustee
or agent for another Person who is a Permitted Transferee and has attached
hereto an affidavit from such Person in substantially the same form as this
affidavit. The Transferee has no knowledge that any such affidavit is false.
3. The Transferee has been advised of, and understands that (i) a tax will
be imposed on Transfers of the Residual Certificate to Persons that are not
Permitted Transferees; (ii) such tax will be imposed on the transferor, or, if
such transfer is through an agent (which includes a broker, nominee or
middleman) for a Person that is not a Permitted Transferee, on the agent; and
(iii) the Person otherwise liable for the tax shall be relieved of liability for
the tax if the subsequent Transferee furnished to such Person an affidavit that
such subsequent Transferee is a Permitted Transferee and, at the time of
transfer, such Person does not have actual knowledge that the affidavit is
false.
4. The Transferee has been advised of, and understands that a tax will be
imposed on a "pass-through entity" holding the Certificate if at any time during
the taxable year of the pass-through entity a Person that is not a Permitted
Transferee is the record Holder of an interest in such entity. The Transferee
understands that, other than in the case of an "electing large partnership"
under Section 775 of the Code, such tax will not be imposed for any period with
respect to which the record Holder furnishes to the pass-through entity an
affidavit that such record Holder is a Permitted Transferee and the pass-through
entity does not have actual knowledge that such affidavit is false. (For this
purpose, a "pass-through entity" includes a regulated investment company, a real
estate investment trust or common trust fund, a partnership, trust or estate,
and certain cooperatives and, except as may be provided in Treasury Regulations,
persons holding interests in pass-through entities as a nominee for another
Person.)
K-1
5. The Transferee has reviewed the provisions of Section 5.02 of the
Agreement and understands the legal consequences of the acquisition of the
Residual Certificate including, without limitation, the restrictions on
subsequent Transfers and the provisions regarding voiding the transfer and
mandatory sales. The Transferee expressly agrees to be bound by and to abide by
the provisions of Section 5.02 of the Agreement and the restrictions noted on
the face of the Certificate. The Transferee understands and agrees that any
breach of any of the representations included herein shall render the transfer
to the Transferee contemplated hereby null and void.
6. The Transferee agrees to require a transfer affidavit in the form of
this Affidavit from any Person to whom the Transferee attempts to transfer the
Residual Certificate, and in connection with any transfer by a Person for whom
the Transferee is acting as nominee, trustee or agent, and the Transferee will
not transfer the Residual Certificate or cause the Residual Certificate to be
transferred to any Person that the Transferee knows is not a Permitted
Transferee.
7. The Transferee historically has paid its debts as they have become due.
8. The Transferee does not have the intention to impede the assessment or
collection of any tax legally required to be paid with respect to the Residual
Certificate.
9. The taxpayer identification number of the Transferee's nominee is
___________.
10. The Transferee is a U.S. Person as defined in Code Section
7701(a)(30).
11. The Transferee is aware that the Residual Certificate may be a
"noneconomic residual interest" within the meaning of Treasury Regulations
promulgated pursuant to the Code and that the transferor of a noneconomic
residual interest will remain liable for any taxes due with respect to the
income on such residual interest, unless no significant purpose of the transfer
was to impede the assessment or collection of tax.
12. The Transferee will not cause income from the Residual Certificate to
be attributable to a foreign permanent establishment or fixed base, within the
meaning of an applicable income tax treaty, of the Transferee or any other
person.
13. If the Transferee is purchasing the Residual Certificate in a transfer
intended to meet the safe harbor provisions of Treasury Regulations Sections
1.860E-1(c), the Transferee has executed and attached Attachment A hereto.
14. The Transferee is not an employee benefit plan or arrangement subject
to Title I of ERISA, a plan subject to Section 4975 of the Code or a plan
subject to any state, local or other federal law substantively similar to the
foregoing provisions of ERISA or the Code (collectively, a "Plan"), and is not
directly or indirectly acquiring this Certificate for, on behalf of or with any
assets of any such Plan.
* * *
K-2
IN WITNESS WHEREOF, the Transferee has caused this instrument to be
executed on its behalf, pursuant to authority of its Board of Directors, by its
duly authorized officer this _____ day of ________________, ____.
Print Name of Transferee
By:____________________________
Name:
Title:
Personally appeared before me the above-named ______________________,
known or proved to me to be the same person who executed the foregoing
instrument and to be the _______________________ of the Transferee, and
acknowledged that he executed the same as his free act and deed and the free act
and deed of the Transferee.
Subscribed and sworn before me this _____ day of _______________________,
____
NOTARY PUBLIC
My Commission expires the ____ day of
______________,_____
K-3
ATTACHMENT A
to
AFFIDAVIT PURSUANT TO SECTION 860E(E)(4) OF THE INTERNAL REVENUE CODE
OF 1986, AS AMENDED, AND FOR NON-ERISA INVESTORS
Check the appropriate box:
[ ] The consideration paid to the Transferee to acquire the Residual
Certificate equals or exceeds the excess of (a) the present value of the
anticipated tax liabilities over (b) the present value of the anticipated
savings associated with holding such Residual Certificate, in each case
calculated in accordance with U.S. Treasury Regulations Sections
1.860E-1(c)(7) and (8), computing present values using a discount rate
equal to the short-term Federal rate prescribed by Section 1274(d) of the
Code and the compounding period used by the Transferee.
OR
[ ] The transfer of the Residual Certificate complies with U.S. Treasury
Regulations Sections 1.860E-1(c)(5) and (6) and, accordingly:
(i) the Transferee is an "eligible corporation," as defined in U.S.
Treasury Regulations Section 1.860E-1(c)(6)(i), as to which income
from Residual Certificate will only be taxed in the United States;
(ii) at the time of the transfer, and at the close of the Transferee's
two fiscal years preceding the year of the transfer, the Transferee
had gross assets for financial reporting purposes (excluding any
obligation of a person related to the Transferee within the meaning
of U.S. Treasury Regulations Section 1.860E-1(c)(6)(ii)) in excess
of $100 million and net assets in excess of $10 million;
(iii) the Transferee will transfer the Residual Certificate only to
another "eligible corporation," as defined in U.S. Treasury
Regulations Section 1.860E-1(c)(6)(i), in a transaction that
satisfies the requirements of Sections 1.860E-1(c)(4)(i), (ii) and
(iii) and Section 1.860E-1(c)(5) of the U.S. Treasury Regulations;
(iv) the Transferee has determined the consideration paid to it to
acquire the Residual Certificate based on reasonable market
assumptions (including, but not limited to, borrowing and investment
rates, prepayment and loss assumptions, expense and reinvestment
assumptions, tax rates and other factors specific to the Transferee)
that it has determined in good faith; and
(v) in the event of any transfer of the Residual Certificate by the
Transferee, the Transferee will require its transferee to complete a
representation in the form of this Attachment A as a condition of
such transferee's purchase of the Residual Certificate.
K-4
EXHIBIT L
FORM OF TRANSFEROR CERTIFICATE
[DATE]
▇▇▇▇▇▇▇ ▇▇▇▇▇ Mortgage Investors, Inc.
4 World Financial Center, 10th Floor
New York, New York 10080
U.S. Bank National Association
Structured Finance
▇▇ ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇-▇▇-▇▇▇▇
▇▇. ▇▇▇▇, ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇-▇▇▇▇
Re: C-BASS Mortgage Loan Asset-Backed Certificates, Series 2004-CB6
Ladies and Gentlemen:
In connection with our disposition of the C-BASS Mortgage Loan
Asset-Backed Certificates, Series 2004-CB6 (the "Certificates"), we certify that
(a) we understand that the Certificates have not been registered under the
Securities Act of 1933, as amended (the "Act"), and are being disposed by us in
a transaction that is exempt from the registration requirements of the Act, (b)
we have not offered or sold any Certificates to, or solicited offers to buy any
Certificates from, any person, or otherwise approached or negotiated with any
person with respect thereto, in a manner that would be deemed, or taken any
other action which would result in, a violation of Section 5 of the Act, (c) to
the extent we are disposing of a Class [ ] Certificate, we have no knowledge the
Transferee is not a Permitted Transferee and (d) no purpose of the proposed
disposition of a Class [ ] Certificate is to impede the assessment or collection
of tax.
Very truly yours,
[_____________________]
By:___________________________
L-1
EXHIBIT M
MONTHLY INFORMATION DELIVERED BY SERVICER
1. With respect to the Mortgage Pool and each Loan Group, the number and
Principal Balances of all Mortgage Loans which were the subject of
Principal Prepayments during the related Prepayment Period.
2. With respect to the Mortgage Pool and each Loan Group, the amount of all
partial Principal Prepayments received by the Servicer during the related
Prepayment Period.
3. With respect to the Mortgage Pool and each Loan Group, the aggregate
amount of principal portion of all Monthly Payments received during the
related Collection Period.
4. With respect to the Mortgage Pool and each Loan Group, the amount of
interest received on the Mortgage Loans during the related Collection
Period.
5. With respect to the Mortgage Pool and each Loan Group, the aggregate
amount of the Advances made and recovered with respect to such
Distribution Date.
6. With respect to the Mortgage Pool and each Loan Group, the delinquency and
foreclosure information and the amount of Mortgage Loan Losses as of the
close of business of the last day of the preceding Collection Period.
7. With respect to the Mortgage Pool and each Loan Group, the weighted
average maturity, the weighted average Mortgage Interest Rate and the
weighted average Net Mortgage Interest Rate as of the last day of the
preceding Collection Period preceding of the related Interest Accrual
Period.
8. The Servicing Fees paid and Servicing Fees accrued during the related
Collection Period.
9. The amount of all payments or reimbursements to the Servicer paid or to be
paid since the prior Distribution Date (or in the case of the first
Distribution Date, since the Closing Date).
10. The Pool Balance and aggregate Principal Balance for each Loan Group.
11. With respect to the Mortgage Pool and each Loan Group, the number of
Mortgage Loans outstanding at the beginning and at the end of the related
Collection Period.
12. The aggregate interest accrued on the Mortgage Loans at their respective
Mortgage Interest Rates for the related Collection Period.
13. The amount deposited in the Collection Account which may not be withdrawn
therefrom pursuant to an order of a United States Bankruptcy Court of
competent jurisdiction imposing a stay pursuant to Section 362 of U.S.
Bankruptcy Code.
14. The aggregate Realized Losses since the Cut-off Date as of the end of the
related Collection Period.
M-1
EXHIBIT N
FORM OF CERTIFICATION
CERTIFICATION TO BE PROVIDED WITH FORM 10-K
2004-CB6 TRUST,
C-BASS MORTGAGE LOAN ASSET-BACKED CERTIFICATES, SERIES 2004-CB6
I, [identify the certifying individual], certify that:
1. I have reviewed this annual report on Form 10-K, and all reports on Form
8-K containing a copy of the monthly statement to certificateholders set
forth in Section 4.06 of the Pooling and Servicing Agreement, dated as of
August 1, 2004 (the "Agreement"), among ▇▇▇▇▇▇▇ ▇▇▇▇▇ Mortgage Investors,
Inc., as depositor (the "Depositor"), Credit-Based Asset Servicing and
Securitization LLC, as seller (the "Seller"), ▇▇▇▇▇▇ Loan Servicing LP, as
servicer (the "Servicer"), and U.S. Bank National Association, as trustee
(the "Trustee"), filed in respect of periods included in the year covered
by this annual report, of the 2004-CB6 Trust (the "Trust");
2. Based on my knowledge, the information in these reports, taken as a whole,
does not contain any untrue statement of a material fact or omit to state
a material fact necessary to make the statements made, in light of the
circumstances under which such statements were made, not misleading as of
the last day of the period covered by this annual report;
3. Based on my knowledge, the distribution or servicing information required
to be provided to the Trustee by the Servicer under the Agreement for
inclusion in these reports is included in these reports;
4. I am responsible for reviewing the activities performed by the Servicer
under the Agreement and based upon my knowledge and the annual compliance
review required under the Agreement, and except as disclosed in the
reports, the Servicer has fulfilled its obligations under the Agreement;
and
5. The reports disclose all significant deficiencies relating to the
Servicer's compliance with the minimum servicing standards based upon the
report provided by an independent public accountant, after conducting a
review in compliance with the Uniform Single Attestation Program for
Mortgage Bankers or similar procedure, as set forth in the Agreement, that
is included in these reports.
6. In giving the certifications above, I have reasonably relied on
information provided to me by the following unaffiliated parties: U.S.
Bank National Association.
By:_______________________
Name:
Title:
N-1
EXHIBIT O
FORM OF CERTIFICATION TO BE PROVIDED BY THE TRUSTEE TO THE SERVICER
2004-CB6 TRUST,
C-BASS MORTGAGE LOAN ASSET-BACKED CERTIFICATES, SERIES 2004-CB6
Reference is made to the Pooling and Servicing Agreement, dated as of
August 1, 2004 (the "Pooling Agreement"), by and among U.S. Bank National
Association (the "Trustee"), Credit-Based Asset Servicing and Securitization
LLC, as seller, ▇▇▇▇▇▇ Loan Servicing LP, as servicer (the "Servicer") and
▇▇▇▇▇▇▇ ▇▇▇▇▇ Mortgage Investors, Inc., as depositor (the "Depositor"). The
Trustee hereby certifies to the Servicer and its officers, directors and
affiliates, and with the knowledge and intent that they will rely upon this
certification, that:
(i) The Trustee has reviewed the annual report on Form 10-K for the
fiscal year [ ], and all reports on Form 8-K containing distribution
reports filed in respect of periods included in the year covered by
that annual report, relating to the above-referenced trust;
(ii) Subject to paragraph (iv), the distribution information in the
distribution reports contained in all Monthly Form 8-K's included in
the year covered by the annual report on Form 10-K for the calendar
year [___], taken as a whole, does not contain any untrue statement
of a material fact or omit to state a material fact required by the
Pooling Agreement to be included therein and necessary to make the
statements made, in light of the circumstances under which such
statements were made, not misleading as of the last day of the
period covered by that annual report;
(iii) The distribution information required to be provided by the Trustee
under the Pooling Agreement is included in these reports.
(iv) In compiling the distribution information and making the foregoing
certifications, the Trustee has relied upon information furnished to
it by the Servicer under the Agreement. The Trustee shall have no
responsibility or liability for any inaccuracy in such reports
resulting from information so provided by the Servicer.
Date:
U.S. Bank National Association, as Trustee
By:____________________________
Name: ________________________
Title: ________________________
O-1
EXHIBIT P
[RESERVED]
P-1
EXHIBIT Q
FORM OF POWER OF ATTORNEY
RECORDING REQUESTED BY
AND WHEN RECORDED MAIL TO
▇▇▇▇▇▇ LOAN SERVICING LP
▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇
▇▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇▇
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"), ▇▇▇▇▇▇ Loan Servicing LP (the
"Servicer"), and the Trustee, dated as of _________1, 200__ (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.
Q-1
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.
Q-2
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.
Q-3
IN WITNESS WHEREOF, ______________________ as Trustee pursuant to that Pooling
and Servicing Agreement among the Depositor, the Servicer, and the Trustee,
dated as of _____________ 1, 200__ (___________________ Mortgage Loan 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 _____ Mortgage Loan 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 ____________ Mortgage Loan 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 ________________________
Q-4