EXECUTION VERSION
AMENDED AND RESTATED TRUST AGREEMENT
dated as of April 29, 2004
among
WASHINGTON MUTUAL MORTGAGE SECURITIES CORP.,
as Depositor and Certificate Administrator,
CITIBANK, N.A.,
as Trustee
and
CHRISTIANA BANK & TRUST COMPANY,
as Delaware Trustee
Washington Mutual Mortgage Securities Corp.
WaMu Mortgage Pass-Through Certificates
Series 2004-RS2
TABLE OF CONTENTS
Page
ARTICLE I ...........................................................................................3
Section 1.01. Definitions.......................................................................3
Administrative Officer.........................................................................3
Aggregate Certificate Principal Balance........................................................3
Allocated Realized Loss........................................................................3
Allocated Uncompensated Interest Shortfall.....................................................4
Authenticating Agent...........................................................................4
Authorized Denomination........................................................................4
Available Distribution Amount..................................................................4
Bankruptcy Coverage............................................................................4
Bankruptcy Loss................................................................................4
Beneficial Holder..............................................................................4
Benefit Plan Opinion...........................................................................4
Book-Entry Certificates........................................................................5
Business Day...................................................................................5
Certificate....................................................................................5
Certificate Account............................................................................5
Certificate Administrator......................................................................5
Certificate Administrator Fee..................................................................5
Certificateholder or Holder....................................................................5
Certificate Interest Rate......................................................................5
Certificate of Trust...........................................................................6
Certificate Principal Balance..................................................................6
Certificate Register and Certificate Registrar.................................................6
Class ......................................................................................6
Class A Certificates...........................................................................6
Class A-1 Certificates.........................................................................6
Class A-2 Certificates.........................................................................6
Class A-3 Certificates.........................................................................6
Class A-4 Accretion Termination Date...........................................................6
Class A-4 Accrual Amount.......................................................................6
Class A-4 Certificates.........................................................................6
Class A-5 Certificates.........................................................................6
Class A-6 Certificates.........................................................................6
Class A-7 Certificates.........................................................................7
Class B Certificates...........................................................................7
Class Principal Balance........................................................................7
Class R Certificates...........................................................................7
Clean-Up Call Percentage.......................................................................7
Clearing Agency................................................................................7
Closing Date...................................................................................7
Code ......................................................................................7
Company ......................................................................................8
Corporate Trust Office.........................................................................8
Corporation....................................................................................8
Credit Support Depletion Date..................................................................8
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Cut-Off Date...................................................................................8
Definitive Certificates........................................................................8
Delaware Trustee...............................................................................8
Depositary Agreement...........................................................................8
Determination Date.............................................................................8
Disqualified Organization......................................................................8
Distribution Amount............................................................................8
Distribution Date.............................................................................10
DTC .....................................................................................10
DTC Participant...............................................................................10
Eligible Institution..........................................................................10
ERISA .....................................................................................10
Event of Default..............................................................................10
FDIC .....................................................................................11
Final Maturity Date...........................................................................11
Fitch .....................................................................................11
Fraud Coverage................................................................................11
Fraud Loss....................................................................................11
▇▇▇▇▇▇▇ Mac...................................................................................11
Indirect DTC Participants.....................................................................11
Interest Distribution Amount..................................................................11
Investment Depository.........................................................................11
Last Scheduled Distribution Date..............................................................11
Lockout Percentage............................................................................11
Lockout Priority Amount.......................................................................11
Master Servicer...............................................................................11
Mortgage Loan Schedule........................................................................11
Mortgage Loans................................................................................12
Non-U.S. Person...............................................................................12
Notice Addresses..............................................................................12
OTS .....................................................................................12
Officer's Certificate.........................................................................12
Opinion of Counsel............................................................................12
Original Trust Agreement......................................................................12
Ownership Interest............................................................................12
Pass-Through Entity...........................................................................12
Paying Agent..................................................................................13
Percentage Interest...........................................................................13
Permitted Transferee..........................................................................13
Person .....................................................................................13
Pooling and Servicing Agreement...............................................................13
Principal Balance.............................................................................14
Principal Distribution Amount.................................................................14
Prior Period..................................................................................14
Pro Rata Allocation...........................................................................14
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Prospectus....................................................................................14
Rating Agency.................................................................................14
Ratings .....................................................................................14
Record Date...................................................................................14
REMIC .....................................................................................14
REMIC Provisions..............................................................................14
REMIC I .....................................................................................14
REMIC I Assets................................................................................14
REMIC I Regular Interests.....................................................................14
Residual Certificates.........................................................................14
Residual Distribution Amount..................................................................14
Responsible Officer...........................................................................15
S&P .....................................................................................15
Secretary of State............................................................................15
Securities Act................................................................................15
Statutory Trust Statute.......................................................................15
Step Down Percentage..........................................................................15
Tax Matters Person............................................................................15
Termination Date..............................................................................16
Termination Payment...........................................................................16
Transfer .....................................................................................16
Transferee....................................................................................16
Transferee Affidavit and Agreement............................................................16
Trust .....................................................................................16
Trust Assets..................................................................................16
Trustee .....................................................................................16
Underlying Certificates.......................................................................16
Underlying Trust..............................................................................16
Underwriter...................................................................................16
U.S. Person...................................................................................16
ARTICLE II Creation of the Trust; Conveyance of the Trust Assets; REMIC Election and
Designations; Original Issuance of Certificates...........................................16
Section 2.01. Creation of the Trust............................................................17
Section 2.02. Restrictions on Activities of the Trust..........................................17
Section 2.03. Separateness Requirements........................................................18
Section 2.04. Conveyance of Trust Assets; Security Interest....................................20
Section 2.05. [Reserved].......................................................................21
Section 2.06. REMIC Election for REMIC I.......................................................21
Section 2.07. [Reserved].......................................................................22
Section 2.08. Representations and Warranties of the Company....................................22
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Section 2.09. Acknowledgment of Transfer of Trust Assets.......................................22
Section 2.10. Legal Title......................................................................22
Section 2.11. Compliance with ERISA Requirements...............................................22
ARTICLE III Administration of the Underlying Certificates.............................................23
Section 3.01. The Company to Act as Certificate Administrator..................................23
Section 3.02. [Reserved].......................................................................23
Section 3.03. [Reserved].......................................................................23
Section 3.04. The Certificate Account..........................................................23
Section 3.05. [Reserved].......................................................................23
Section 3.06. [Reserved].......................................................................23
Section 3.07. [Reserved].......................................................................23
Section 3.08. [Reserved].......................................................................23
Section 3.09. Compliance with Federal Withholding Requirements.................................23
Section 3.10. [Reserved].......................................................................24
Section 3.11. Compensation to the Certificate Administrator....................................24
Section 3.12. Reports to the Trustee; Certificate Account Statement............................24
Section 3.13. Annual Statement as to Compliance................................................24
Section 3.14. [Reserved].......................................................................24
Section 3.15. Annual Independent Public Accountants' Servicing Report..........................24
ARTICLE IV Payments to Certificateholders; Payment of Expenses.......................................25
Section 4.01. Distributions to Certificateholders; Payment of Certificate Administrator
Fee..............................................................................25
Section 4.02. Distribution Reports to the Trustee..............................................26
Section 4.03. [Reserved.]......................................................................26
Section 4.04. Statements to Certificateholders.................................................26
ARTICLE V The Certificates..........................................................................27
Section 5.01. The Certificates.................................................................27
Section 5.02. Certificates Issuable in Classes; Distributions of Principal and
Interest; Authorized Denominations...............................................31
Section 5.03. Registration of Transfer and Exchange of Certificates............................31
Section 5.04. Mutilated, Destroyed, Lost or Stolen Certificates................................32
Section 5.05. Persons Deemed Owners............................................................32
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Section 5.06. Temporary Certificates...........................................................32
Section 5.07. Book-Entry for Book-Entry Certificates...........................................33
Section 5.08. Notices to Clearing Agency.......................................................34
Section 5.09. Definitive Certificates..........................................................34
Section 5.10. Office for Transfer of Certificates..............................................35
Section 5.11. Nature of Certificates...........................................................35
ARTICLE VI The Company and the Certificate Administrator.............................................35
Section 6.01. Liability of the Company and the Certificate Administrator.......................35
Section 6.02. Merger or Consolidation of the Company, or the Certificate Administrator.........35
Section 6.03. Limitation on Liability of the Company, the Certificate Administrator and
Others...........................................................................35
Section 6.04. The Company and the Certificate Administrator not to Resign......................36
Section 6.05. Trustee Access...................................................................36
ARTICLE VII Default...................................................................................37
Section 7.01. Events of Default................................................................37
Section 7.02. Trustee to Act; Appointment of Successor.........................................39
Section 7.03. Notification to Certificateholders...............................................40
ARTICLE VIII Concerning the Trustees...................................................................40
Section 8.01. Duties of Trustees...............................................................40
Section 8.02. Certain Matters Affecting the Trustees...........................................41
Section 8.03. Trustees Not Liable for Certificates or Underlying Certificates..................42
Section 8.04. Trustees May Own Certificates....................................................43
Section 8.05. The Certificate Administrator to Pay Trustees' Fees and Expenses.................43
Section 8.06. Eligibility Requirements for Trustees............................................43
Section 8.07. Resignation and Removal of Trustees..............................................44
Section 8.08. Successor Trustee................................................................44
Section 8.09. Merger or Consolidation of Trustee...............................................45
Section 8.10. Appointment of Co-Trustee or Separate Trustee....................................45
Section 8.11. Authenticating Agents............................................................46
Section 8.12. Paying Agents....................................................................47
Section 8.13. Duties of Delaware Trustee.......................................................48
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Section 8.14. Amendment to Certificate of Trust................................................48
Section 8.15. Limitation of Liability..........................................................48
ARTICLE IX Termination...............................................................................49
Section 9.01. Termination Upon Purchase by the Certificate Administrator of the
Underlying Certificates..........................................................49
Section 9.02. Additional Termination Requirements..............................................50
Section 9.03. Trust Irrevocable................................................................51
ARTICLE X Miscellaneous Provisions..................................................................51
Section 10.01. Amendment........................................................................51
Section 10.02. [Reserved.]......................................................................53
Section 10.03. Limitation on Rights of Certificateholders.......................................53
Section 10.04. Access to List of Certificateholders.............................................53
Section 10.05. Governing Law....................................................................54
Section 10.06. Notices..........................................................................54
Section 10.07. Severability of Provisions.......................................................54
Section 10.08. Counterpart Signatures...........................................................54
Section 10.09. Benefits of Agreement............................................................55
Section 10.10. Notices and Copies to Rating Agencies............................................55
Exhibit A Form of Certificates (other than Class R Certificates)
Exhibit B [Reserved]
Exhibit C [Reserved]
Exhibit E Selling And Servicing Contract
Exhibit F [Reserved]
Exhibit G [Reserved]
Exhibit H Form of Additional Matter Incorporated Into The Certificates
Exhibit I Transferor Certificate
Exhibit J Transferee Affidavit And Agreement
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This Amended and Restated Trust Agreement, dated and effective as of
April 29, 2004 (this "Agreement"), is executed by and among Washington Mutual
Mortgage Securities Corp., as depositor and Certificate Administrator (the
"Company"), Citibank, N.A., a national banking association with a corporate
trust office at ▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇, 14th Floor, ▇▇▇▇ ▇, ▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇,
as Trustee (the "Trustee"), and Christiana Bank & Trust Company, as Delaware
Trustee (the "Delaware Trustee"). Capitalized terms used in this Agreement and
not otherwise defined have the meanings ascribed to such terms in Article I
hereof.
PRELIMINARY STATEMENT
The Company at the Closing Date is the owner of the Underlying
Certificates and the other property being conveyed by it to the Trust. On the
Closing Date, the Company will acquire the Certificates from the Trust as
consideration for its transfer to the Trust of the Underlying Certificates and
certain other assets and will be the owner of the Certificates. The Company has
duly authorized the execution and delivery of this Agreement to provide for (i)
the conveyance to the Trust of the Underlying Certificates and certain other
assets and (ii) the issuance to the Company of the Certificates, such
Certificates representing in the aggregate the entire beneficial interest in
REMIC I. The Company is entering into this Agreement, and the Trustee and the
Delaware Trustee are each accepting the trust created hereby, for good and
valuable consideration, the receipt and sufficiency of which are hereby
acknowledged.
The Certificates issued hereunder have been offered for sale pursuant
to a Prospectus, dated February 10, 2004, and a Prospectus Supplement, dated
April 27, 2004, of the Company (together, the "Prospectus"). The Trust created
hereunder is intended to be the "Trust" described in the Prospectus and the
Certificates are intended to be the "Certificates" described therein. The
following table sets forth the designation, type of interest, Certificate
Interest Rate, initial Class Principal Balance and Final Maturity Date for the
Certificates:
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REMIC I Interests
Class Designation for Certificate Initial Class
each Class of Type of Interest Principal Final Maturity
Certificates Interest Rate (1) Balance Date*
------------------------ ------------ -------------------- -------------------- ------------------------
Class A-1 Regular 5.000% $107,251,000.00 November 2033
Class A-2 Regular 5.000% 5,155,000.00 November 2033
Class A-3 Regular 5.000% 4,041,000.00 November 2033
Class A-4 Regular 5.000%(2) 7,108,041.00 November 2033
Class A-5 Regular (3) 1,111,445.00 November 2033
Class A-6 Regular 5.000% 13,164,000.00 November 2033
Class A-7 Regular 5.000% 1,100,000.00 November 2033
Class R (4) Residual 5.000% 100.00 November 2033
* The Distribution Date in the specified month, which is the month
following the month the latest maturing Mortgage Loan matures. For
federal income tax purposes, for each Class of Certificates, the
"latest possible maturity date" shall be the Final Maturity Date.
(1) Interest distributed on each Distribution Date to the Certificates
(other than the Class A-5 Certificates, which shall not be entitled to
receive any distributions of interest) will have accrued at the
applicable per annum Certificate Interest Rate on the applicable Class
Principal Balance outstanding immediately before such Distribution
Date.
(2) On each Distribution Date on or before the Class A-4 Accretion
Termination Date, an amount equal to the Class A-4 Accrual Amount shall
be added to the Class A-4 Principal Balance, and such amount shall be
distributed as principal to certain Classes of Class A Certificates and
shall not be distributed as interest to the Class A-4 Certificates.
(3) The Class A-5 Certificates shall not be entitled to receive any
distributions of interest. (4) The Class R Certificates shall be
entitled to receive the Residual Distribution Amount.
As provided herein, with respect to REMIC I, the Company will cause an
election to be made on behalf of REMIC I to be treated for federal income tax
purposes as a REMIC. The Certificates (other than the Class R Certificates) will
be designated regular interests in REMIC I and the Class R Certificates will be
designated the sole class of residual interest in REMIC I, for purposes of the
REMIC Provisions. As of the Closing Date, the Underlying Certificates have a
Class Principal Balance of $138,930,586.00. As of the Closing Date, the
Certificates have an Aggregate Certificate Principal Balance of $138,930,586.00.
W I T N E S S E T H :
WHEREAS, the Company is a corporation duly organized and existing under and by
virtue of the laws of the State of Delaware and has full corporate power and
authority to enter into this Agreement and to undertake the obligations
undertaken by it herein;
WHEREAS, the Trustee is a national banking association duly organized and
existing under the laws of the United States of America and has full power and
authority to enter into this Agreement;
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WHEREAS, the Delaware Trustee is a banking corporation duly organized and
existing under the laws of the State of Delaware and has full power and
authority to enter into this Agreement;
WHEREAS, prior to the execution and delivery hereof, the Company and the
Delaware Trustee have entered into the Original Trust Agreement, and the
Delaware Trustee has filed the Certificate of Trust;
WHEREAS, it is the intention of the Company, the Trustee and the Delaware
Trustee that the Trust created by this Agreement constitute a statutory trust
under the Statutory Trust Statute, that this Agreement constitute the governing
instrument of the Trust, and that this Agreement amend and restate the Original
Trust Agreement;
WHEREAS, the Company is the owner of the Underlying Certificates on the Closing
Date; and
WHEREAS, the Company has been duly authorized to create the Trust to (i) hold
the Underlying Certificates and certain other property and (ii) issue the
Certificates.
NOW, THEREFORE, in order to declare the terms and conditions upon which the
Certificates are to be issued, and in consideration of the premises and of the
purchase and acceptance of the Certificates by the Holders thereof, the Company
covenants and agrees with the Trustee and the Delaware Trustee, for the equal
and proportionate benefit of the respective Holders from time to time of the
Certificates, as applicable, as follows:
ARTICLE I
Section 1.01. Definitions.
Whenever used in this Agreement, the following words and phrases, unless the
context otherwise requires, shall have the following meanings:
Administrative Officer: Any officer of the Certificate Administrator involved
in, or responsible for, the administration of the Certificates, whose name and
specimen signature appear on a list of servicing officers furnished to the
Trustee by the Certificate Administrator, as such list may from time to time be
amended.
Aggregate Certificate Principal Balance: At any given time, the sum of the then
current Class Principal Balances of the Certificates.
Allocated Realized Loss: For any Distribution Date, any Realized Loss (as
defined in the Pooling and Servicing Agreement) allocated to the Underlying
Certificates pursuant to the definition of "Realized Loss" in the Pooling and
Servicing Agreement.
Allocated Realized Losses shall be allocated among the Class A Certificates (i)
for Allocated Realized Losses allocable to principal, to the Class A
3
Certificates, pro rata according to the Class Principal Balance thereof, in
reduction thereof; and (ii) for Allocated Realized Losses allocable to interest,
to the Class A Certificates (other than the Class A-5 Certificates), pro rata
according to accrued but unpaid interest on such Classes, in reduction thereof,
and then to the Class A Certificates (other than the Class A-5 Certificates),
pro rata according to the Class Principal Balances thereof, in reduction
thereof; provided, however, that until the Class A-7 Principal Balance has been
reduced to zero, all principal losses (other than Allocated Realized Losses
allocated to the Underlying Certificates by Pro Rata Allocation) that would
otherwise be allocated to the Class A-4 and Class A-6 Certificates pursuant to
clause (i) of this paragraph shall instead be allocated to the A-7 Certificates,
in reduction of the Class A-7 Principal Balance, and all interest losses (other
than Allocated Realized Losses allocated to the Underlying Certificates by Pro
Rata Allocation) that would otherwise be allocated to the Class A-4 and Class
A-6 Certificates pursuant to clause (ii) of this paragraph shall instead be
allocated to the Class A-7 Certificates, in reduction of accrued but unpaid
interest thereon, and then in reduction of the Class A-7 Principal Balance.
Allocated Uncompensated Interest Shortfall: For any Distribution Date, the
amount of Uncompensated Interest Shortfall (as defined in the Pooling and
Servicing Agreement) allocated to the Underlying Certificates on such
Distribution Date pursuant to the definition of "Uncompensated Interest
Shortfall" in the Pooling and Servicing Agreement.
Allocated Uncompensated Interest Shortfall shall be allocated to the Class A
Certificates pro rata according to the amount of interest accrued on each such
Class during the immediately preceding accrual period, in reduction thereof.
Authenticating Agent: Any authenticating agent appointed by the Trustee pursuant
to Section 8.11.
Authorized Denomination: With respect to the Class A Certificates, an initial
Certificate Principal Balance equal to $25,000 and multiples of $1 in excess
thereof. With respect to the Class R Certificates, one Certificate with a
Percentage Interest equal to 0.01% and one Certificate with a Percentage
Interest equal to 99.99%.
Available Distribution Amount: For any Distribution Date, the amount distributed
to the Underlying Certificates on that Distribution Date pursuant to the Pooling
and Servicing Agreement, reduced by the Certificate Administrator Fee payable to
the Certificate Administrator on such Distribution Date.
Bankruptcy Coverage: As defined in the Pooling and Servicing Agreement.
Bankruptcy Loss: As defined in the Pooling and Servicing Agreement.
Beneficial Holder: A Person holding a beneficial interest in any Book-Entry
Certificate as or through a DTC Participant or an Indirect DTC Participant or a
Person holding a beneficial interest in any Definitive Certificate.
Benefit Plan Opinion: With respect to any Certificate presented for registration
in the name of any Person, an Opinion of Counsel acceptable to and in form and
substance satisfactory to the Trustee and the Company to the effect that the
4
purchase or holding of such Certificate is permissible under applicable law,
will not constitute or result in a non-exempt prohibited transaction under
Section 406 of ERISA or Section 4975 of the Code, and will not subject the
Trust, the Trustee, the Delaware Trustee, the Certificate Administrator or the
Company to any obligation or liability (including obligations or liabilities
under Section 406 of ERISA or Section 4975 of the Code) in addition to those
undertaken in this Agreement, which Opinion of Counsel shall not be an expense
of the Trust, the Trustee, the Delaware Trustee, the Certificate Administrator
or the Company.
Book-Entry Certificates: The Class A Certificates, beneficial ownership and
transfers of which shall be made through book entries as described in Section
5.07.
Business Day: Any day other than a Saturday, a Sunday, or a day on which banking
institutions in Stockton, California, Chicago, Illinois, New York, New York or
Seattle, Washington or any city in which the Corporate Trust Office is located
are authorized or obligated by law or executive order to be closed.
Certificate: Any one of the Certificates issued pursuant to this Agreement,
executed by the Trustee and authenticated by or on behalf of the Trustee
hereunder in substantially one of the forms set forth in Exhibit A and B hereto.
The additional matter appearing in Exhibit H shall be deemed incorporated into
Exhibit A as though set forth at the end of such Exhibit.
Certificate Account: The separate trust account created and maintained with the
Trustee, the Investment Depository or any other bank or trust company acceptable
to the Rating Agencies which is incorporated under the laws of the United States
or any state thereof pursuant to Section 3.04, which account shall bear a
designation clearly indicating that the funds deposited therein are held in
trust for the benefit of the Trust or any other account serving a similar
function acceptable to the Rating Agencies. Funds deposited in the Certificate
Account (exclusive of the Certificate Administrator Fee) shall be held in trust
for the Certificateholders and for the uses and purposes set forth in Section
2.01, Section 3.04, Section 3.05 and Section 4.01.
Certificate Administrator: The Company, or any successor thereto appointed as
provided pursuant to Section 7.02, acting to administer the Certificates
pursuant to Section 3.01.
Certificate Administrator Fee: The monthly fee charged by the Certificate
Administrator for performing its duties hereunder, equal to, for each
Distribution Date, the product of (i) 1/12th of 0.040% and (ii) the aggregate
Class Principal Balance of the Certificates.
Certificateholder or Holder: With respect to the Certificates, the person in
whose name a Certificate is registered in the Certificate Register, except that,
solely for the purposes of giving any consent pursuant to this Agreement, any
Certificate registered in the name of the Company, the Certificate Administrator
or any affiliate thereof shall be deemed not to be outstanding and the
Percentage Interest evidenced thereby shall not be taken into account in
determining whether the requisite percentage of Percentage Interests necessary
to effect any such consent has been obtained; provided, that the Trustee may
conclusively rely upon an Officer's Certificate to determine whether any Person
is an affiliate of the Company or the Certificate Administrator.
Certificate Interest Rate: For each Class of Certificates, the per annum rate
set forth as the Certificate Interest Rate for such Class in the Preliminary
Statement hereto.
5
Certificate of Trust: The certificate of trust filed by the Delaware Trustee
with respect to the Trust with the Secretary of State in accordance with Section
3810(a) of the Statutory Trust Statute.
Certificate Principal Balance: For each Certificate of any Class, the portion of
the related Class Principal Balance, if any, represented by such Certificate.
Certificate Register and Certificate Registrar: The register maintained and the
registrar appointed, respectively, pursuant to Section 5.03.
Class: All Certificates having the same priority and rights to payments on the
Underlying Certificates from the Available Distribution Amount, which
Certificates shall be designated as a separate Class, and which shall be set
forth in the applicable forms of Certificates attached hereto as Exhibit A. Each
Class of Certificates shall be entitled to receive the amounts allocated to such
Class pursuant to the definition of "Distribution Amount" only to the extent of
the Available Distribution Amount for such Distribution Date remaining after
distributions in accordance with prior clauses of the definition of
"Distribution Amount."
Class A Certificates: The Class A-1, Class A-2, Class A-3, Class A-4, Class A-5,
Class A-6 and Class A-7 Certificates.
Class A-1 Certificates: The Certificates designated as "Class A-1" on the face
thereof in substantially the form attached hereto as Exhibit A.
Class A-2 Certificates: The Certificates designated as "Class A-2" on the face
thereof in substantially the form attached hereto as Exhibit A.
Class A-3 Certificates: The Certificates designated as "Class A-3" on the face
thereof in substantially the form attached hereto as Exhibit A.
Class A-4 Accretion Termination Date: The earlier to occur of (i) the
Distribution Date on which the Class A-2 and Class A-3 Principal Balances have
each been reduced to zero and (ii) the Credit Support Depletion Date.
Class A-4 Accrual Amount: For any Distribution Date, an amount equal to the
amounts that would be payable to the Class A-4 Certificates as interest on such
Distribution Date pursuant to clauses (I)(i) and (I)(ii)(a) of the definition of
"Distribution Amount" without regard to the provisos in such clauses.
Notwithstanding the foregoing, for any Distribution Date after the Class A-4
Accretion Termination Date, the Class A-4 Accrual Amount shall be zero.
Class A-4 Certificates: The Certificates designated as "Class A-4" on the face
thereof in substantially the form attached hereto as Exhibit A.
Class A-5 Certificates: The Certificates designated as "Class A-5" on the face
thereof in substantially the form attached hereto as Exhibit A.
Class A-6 Certificates: The Certificates designated as "Class A-6" on the face
thereof in substantially the form attached hereto as Exhibit A.
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Class A-7 Certificates: The Certificates designated as "Class A-7" on the face
thereof in substantially the form attached hereto as Exhibit A.
Class B Certificates: The WaMu Mortgage Pass-Through Certificates, Series
2003-S11, Class B-1, Class B-2, Class B-3, Class B-4, Class B-5 and Class B-6,
issued by the Underlying Trust pursuant to the Pooling and Servicing Agreement.
Class Principal Balance: For any Class of Certificates, the applicable initial
Class Principal Balance therefor set forth in the Preliminary Statement hereto,
corresponding to the rights of such Class in payments of principal due to be
passed through to the Certificateholders from principal payments on the Mortgage
Loans, as reduced from time to time by (x) distributions of principal (including
any Class A-4 Accrual Amount) to the Certificateholders of such Class and (y)
the portion of Allocated Realized Losses allocated to the Class Principal
Balance of such Class pursuant to the definition of "Allocated Realized Loss"
with respect to a given Distribution Date. For any Distribution Date, the
reduction of the Class Principal Balance of any Class of Certificates pursuant
to the definition of "Allocated Realized Loss" shall be deemed effective after
the determination and distribution of principal on such Class pursuant to the
definition of "Distribution Amount."
For the Underlying Certificates or the Class B Certificates the respective
"Class Principal Balance" thereof as defined in the Pooling and Servicing
Agreement.
Notwithstanding the foregoing, any amounts distributed in respect of principal
losses pursuant to paragraph (I)(iv) of the definition of "Distribution Amount"
shall not cause a reduction in the Class Principal Balances of the Certificates.
In addition to the foregoing, on each Distribution Date on or before the Class
A-4 Accretion Termination Date, the Class Principal Balance of the Class A-4
Certificates shall be increased by the Class A-4 Accrual Amount for such
Distribution Date.
The Class Principal Balance for the Class A-1 Certificates shall be referred to
as the "Class A-1 Principal Balance," the Class Principal Balance for the Class
A-2 Certificates shall be referred to as the "Class A-2 Principal Balance" and
so on.
Class R Certificates: The Certificates designated as "Class R" on the face
thereof in substantially the form attached hereto as Exhibit A, which Class has
been designated as the sole class of "residual interest" in REMIC I pursuant to
Section 2.06 for purposes of Section 860G(a)(2) of the Code.
Clean-Up Call Percentage: 10%.
Clearing Agency: An organization registered as a "clearing agency" pursuant to
Section 17A of the Securities Exchange Act of 1934, as amended, which initially
shall be DTC.
Closing Date: April 29, 2004 which is the date of settlement of the sale of the
Certificates to the original purchasers thereof.
Code: The Internal Revenue Code of 1986, as amended.
7
Company: Washington Mutual Mortgage Securities Corp., a Delaware corporation, or
its successor-in-interest.
Corporate Trust Office: The corporate trust office of the Trustee, at which at
any particular time its corporate trust business with respect to this Agreement
shall be administered, which office at the date of the execution of this
Agreement is located at ▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇, 14th Floor, ▇▇▇▇ ▇, ▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇
▇▇▇▇▇, Attention: Structured Finance Group, Washington Mutual 2004-RS2.
Corporation: Any Person (other than an individual, partnership, joint venture or
unincorporated organization) incorporated, associated, organized, chartered or
existing under the laws of any state or under the federal laws of the United
States of America; provided, that such Person have indefinite existence under
the law of its domicile.
Credit Support Depletion Date: The first Distribution Date on which the
aggregate Class Principal Balance of the Class B Certificates has been or will
be reduced to zero.
Cut-Off Date: October 1, 2003.
Definitive Certificates: Certificates in definitive, fully registered and
certificated form.
Delaware Trustee: Christiana Bank & Trust Company, or its successor-in-interest
as provided in Section 8.09, or any successor trustee appointed as herein
provided.
Depositary Agreement: The Letter of Representations, dated April 28, 2004 by and
among DTC, the Trust and the Trustee. The Trustee is authorized to enter into
the Depositary Agreement on behalf of the Trust.
Determination Date: As defined in the Pooling and Servicing Agreement.
Disqualified Organization: Any Person which is not a Permitted Transferee, but
does not include any Pass-Through Entity which owns or holds a Residual
Certificate and of which a Disqualified Organization, directly or indirectly,
may be a stockholder, partner or beneficiary.
Distribution Amount: (I) For any Distribution Date prior to the Credit Support
Depletion Date, the Distribution Amount shall be distributed to the Certificates
in the following amounts and priority, to the extent of the Available
Distribution Amount for such Distribution Date:
(i) first, to the Class A and Class R Certificates, concurrently, the Interest
Distribution Amounts for such Classes remaining unpaid from previous
Distribution Dates, pro rata according to their respective shares of such unpaid
amounts; provided, however, that on or before the Class A-4 Accretion
Termination Date, the amount that would otherwise be payable to the Class A-4
Certificates pursuant to this clause (I)(i) will be paid instead as principal as
set forth in clause (I)(ii)(b) of this definition of "Distribution Amount";
(ii) second,
8
(a) to the Class A and Class R Certificates, concurrently, the Interest
Distribution Amounts for such Classes for the current Distribution Date, pro
rata according to their respective Interest Distribution Amounts; provided,
however, that on or before the Class A-4 Accretion Termination Date, the amount
that would otherwise be payable to the Class A-4 Certificates pursuant to this
clause (I)(ii)(a) will be paid instead as principal as set forth in clause
(I)(ii)(b) of this definition of "Distribution Amount";
(b) on or before the Class A-4 Accretion Termination Date, the Class A-4 Accrual
Amount, as principal, sequentially, as follows:
(1) first, to the Class A-2 Certificates, until the Class A-2 Principal Balance
has been reduced to zero;
(2) second, to the Class A-3 Certificates, until the Class A-3 Principal Balance
has been reduced to zero; and
(3) third, to the Class A-4 Certificates;
(iii) third, to the Class A and Class R Certificates, as principal, the
Principal Distribution Amount, first, to the Class R Certificates until the
Class Principal Balance thereof has been reduced to zero, and then,
concurrently, as follows:
(a) 0.80% to the Class A-5 Certificates, until the Class A-5 Principal Balance
has been reduced to zero; and
(b) 99.20%, sequentially, as follows:
(1) first, to the Class A-6 and Class A-7 Certificates, pro rata, an amount, up
to the amount of the Lockout Priority Amount for that Distribution Date;
(2) second, to the Class A-1 Certificates, until the Class A-1 Principal Balance
has been reduced to zero;
(3) third, to the Class A-2 Certificates, until the Class A-2 Principal Balance
has been reduced to zero;
(4) fourth, to the Class A-3 Certificates, until the Class A-3 Principal Balance
has been reduced to zero;
(5) fifth, to the Class A-4 Certificates, until the Class A-4 Principal Balance
has been reduced to zero; and
(6) sixth, to the Class A-6 and Class A-7 Certificates, pro rata, until the
Class A-6 and Class A-7 Principal Balances have each been reduced to zero;
9
(iv) fourth, to each Class of Class A Certificates in order of seniority, pro
rata, the remaining portion, if any, of the Available Distribution Amount, up to
the amount of unreimbursed Allocated Realized Losses allocable to principal
previously allocated or to be allocated on such Distribution Date to such Class,
if any; provided, that any amounts distributed pursuant to this paragraph
(I)(iv) of this definition of "Distribution Amount" shall not cause a reduction
in the Class Principal Balances of any of the Certificates; and
(v) fifth, to the Class R Certificates, the Residual Distribution Amount for
such Distribution Date.
(II) For any Distribution Date on or after the Credit Support Depletion Date,
the Available Distribution Amount for such Distribution Date shall be
distributed to the outstanding Classes of Certificates in the following amounts
and priority:
(i) first, to the Class A Certificates, the amount payable to each such Class of
Certificates on prior Distribution Dates pursuant to clause (I)(ii) or (II)(ii)
of this definition of "Distribution Amount," and remaining unpaid, pro rata
according to such amount payable to the extent of amounts available;
(ii) second, to the Class A Certificates, concurrently, the Interest
Distribution Amounts for such Classes of Certificates for the current
Distribution Date, pro rata according to their respective Interest Distribution
Amounts;
(iii) third, to the Class A Certificates, pro rata according to Class Principal
Balance, as principal, the Principal Distribution Amount; and
(iv) fourth, to the Class R-1 Residual Interest, the Residual Distribution
Amount for the Class R-1 Residual Interest for such Distribution Date.
Distribution Date: With respect to distributions on the Underlying Certificates
and the Certificates, the 25th day (or, if such 25th day is not a Business Day,
the Business Day immediately succeeding such 25th day) of each month, with the
first such date being May 25, 2004.
DTC: The Depository Trust Company.
DTC Participant: A broker, dealer, bank, other financial institution or other
Person for whom DTC effects book-entry transfers and pledges of securities
deposited with DTC.
Eligible Institution: An institution having (i) the highest short-term debt
rating, and one of the two highest long-term debt ratings of the Rating Agencies
or (ii) the approval of the Rating Agencies.
ERISA: The Employee Retirement Income Security Act of 1974, as amended.
Event of Default: Any event of default as specified in Section 7.01.
10
FDIC: Federal Deposit Insurance Corporation, or any successor thereto.
Final Maturity Date: With respect to each Class of the Certificates, the date
set forth in the table contained in the Preliminary Statement hereto.
Fitch: Fitch Ratings, provided that at any time it be a Rating Agency.
Fraud Coverage: As defined in the Pooling and Servicing Agreement.
Fraud Loss: As defined in the Pooling and Servicing Agreement.
▇▇▇▇▇▇▇ Mac: The entity formerly known as the Federal Home Loan Mortgage
Corporation, or any successor thereto.
Indirect DTC Participants: Entities such as banks, brokers, dealers or trust
companies, that clear through or maintain a custodial relationship with a DTC
Participant, either directly or indirectly.
Interest Distribution Amount3: For any Distribution Date, for any Class of
Certificates, the amount of interest accrued during the Prior Period, at the
related Certificate Interest Rate for such Class for such Distribution Date, on
the respective Class Principal Balance immediately before such Distribution
Date, reduced by Allocated Uncompensated Interest Shortfall and the interest
portion of Allocated Realized Losses allocated to such Class pursuant to the
definitions of "Allocated Uncompensated Interest Shortfall" and "Allocated
Realized Loss," respectively. The computation of interest accrued shall be made
on the basis of a 360-day year of twelve 30-day months. The Interest
Distribution Amounts for the Class A-5 Certificates shall equal zero.
Investment Depository: JPMorgan Chase Bank, or another bank or trust company
designated from time to time by the Certificate Administrator. The Investment
Depository shall at all times be an Eligible Institution.
Last Scheduled Distribution Date: With respect to any Class of Certificates, the
Final Maturity Date for such Class.
Lockout Percentage: For any Distribution Date, the product of (i) the aggregate
Class Principal Balance of the Class A-6 and Class A-7 Certificates divided by
the aggregate Class Principal Balance of the Certificates, in each case
immediately before such Distribution Date and (ii) the Step Down Percentage.
Lockout Priority Amount: For any Distribution Date, the product of (i) the
Lockout Percentage and (ii) the Principal Distribution Amount for that
Distribution Date.
Master Servicer: As defined in the Pooling and Servicing Agreement.
Mortgage Loan Schedule: The schedule, as amended from time to time, of Mortgage
Loans attached as Exhibit D to the Pooling and Servicing Agreement.
11
Mortgage Loans: The mortgage loans and cooperative loans (if any) listed on the
Mortgage Loan Schedule attached as Exhibit D to the Pooling and Servicing
Agreement and transferred and assigned to the Underlying Trust pursuant to the
Pooling and Servicing Agreement.
Non-U.S. Person: A Person that is not a U.S. Person.
Notice Addresses: (a) In the case of the Company, ▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇, ▇▇▇▇▇▇
▇▇▇▇▇, ▇▇▇▇▇▇▇▇ ▇▇▇▇▇, Attention: Master Servicing Department, with a copy to:
Washington Mutual Legal Department, 1201 Third Avenue, WMT 1706, ▇▇▇▇▇▇▇, ▇▇
▇▇▇▇▇, Attention: WMMSC, or such other address as may hereafter be furnished to
the Trustee in writing by the Company, (b) in the case of the Trustee, at its
Corporate Trust Office, or such other address as may hereafter be furnished to
the Certificate Administrator in writing by the Trustee, (c) in the case of the
Delaware Trustee, ▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇, or such other address
as may hereafter be furnished to the Certificate Administrator in writing by the
Delaware Trustee, (d) in the case of the Trust, c/o Citibank, N.A., at the
Corporate Trust Office, or such other address as may hereafter be furnished to
the Certificate Administrator in writing by the Trustee, (e) in the case of the
Certificate Registrar, at its Corporate Trust Office, or such other address as
may hereafter be furnished to the Trustee in writing by the Certificate
Registrar, (f) in the case of S&P, ▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇ ▇▇▇▇▇, ▇▇▇ ▇▇▇▇, ▇▇▇
▇▇▇▇ 10041-0003, Attention: ▇▇▇▇▇ ▇▇▇▇▇▇, or such other address as may hereafter
be furnished to the Trustee and Certificate Administrator in writing by S&P and
(g) in the case of Fitch, ▇ ▇▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇, ▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇,
Attention: ▇▇▇▇▇ ▇▇▇▇▇▇▇▇, or such other address as may hereafter be furnished
to the Trustee and Certificate Administrator in writing by Fitch.
OTS: The Office of Thrift Supervision, or any successor thereto.
Officer's Certificate: A certificate signed by the Chairman of the Board, the
President, a Vice President, or the Treasurer of the Certificate Administrator
and delivered to the Trustee or the Delaware Trustee, as applicable.
Opinion of Counsel: A written opinion of counsel, who shall be reasonably
acceptable to the Trustee or the Delaware Trustee, as applicable, and who may be
counsel (including in-house counsel) for the Company or the Certificate
Administrator.
Original Trust Agreement: The Trust Agreement, dated as of April 1, 2004,
between the Company and the Delaware Trustee, providing for the creation of the
Trust.
Ownership Interest: With respect to any Residual Certificate, any ownership or
security interest in such Residual Certificate, including any interest in a
Residual Certificate as the Holder thereof and any other interest therein
whether direct or indirect, legal or beneficial, as owner or as pledgee.
Pass-Through Entity: Any regulated investment company, real estate investment
trust, common trust fund, partnership, trust or estate, and any organization to
which Section 1381 of the Code applies.
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Paying Agent: Any paying agent appointed by the Trustee pursuant to Section
8.12.
Percentage Interest: (a) With respect to the right of each Certificate of a
particular Class in the distributions allocated to such Class, "Percentage
Interest" shall mean the percentage equal to:
(i) with respect to any Certificate (other than the Residual Certificates), its
Certificate Principal Balance divided by the applicable Class Principal Balance;
and
(ii) with respect to any Residual Certificate, the percentage set forth on the
face of such Certificate.
(b) With respect to the rights of each Certificate in connection with Sections
5.09, 7.01, 8.01(c), 8.02, 8.07, 10.01 and 10.03, "Percentage Interest" shall
mean the percentage equal to:
(i) with respect to any Certificate (other than the Residual Certificates), its
Certificate Principal Balance divided by the Aggregate Certificate Principal
Balance of the Certificates; and
(ii) with respect to any Residual Certificate, zero.
Permitted Transferee: With respect to the holding or ownership of any Residual
Certificate, any Person other than (i) the United States, a State or any
political subdivision thereof, or any agency or instrumentality of any of the
foregoing, (ii) a foreign government, International Organization or any agency
or instrumentality of either of the foregoing, (iii) an organization (except
certain farmers' cooperatives described in Code Section 521) which is exempt
from the taxes imposed by Chapter 1 of the Code (unless such organization is
subject to the tax imposed by Section 511 of the Code on unrelated business
taxable income), (iv) rural electric and telephone cooperatives described in
Code Section 1381(a)(2)(C), (v) any "electing large partnership" as defined in
Section 775(a) of the Code, (vi) any Person from whom the Trustee has not
received an affidavit to the effect that it is not a "disqualified organization"
within the meaning of Section 860E(e)(5) of the Code, and (vii) any other Person
so designated by the Company based upon an Opinion of Counsel that the transfer
of an Ownership Interest in a Residual Certificate to such Person may cause
REMIC I to fail to qualify as a REMIC at any time that the Certificates are
outstanding. The terms "United States," "State" and "International Organization"
shall have the meanings set forth in Code Section 7701 or successor provisions.
A corporation shall 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, with the exception of the ▇▇▇▇▇▇▇ Mac, a majority of its
board of directors is not selected by such governmental unit.
Person: Any individual, corporation, limited liability company, partnership,
joint venture, association, joint-stock company, trust, unincorporated
organization or government or any agency or political subdivision thereof.
Pooling and Servicing Agreement: The Pooling and Servicing Agreement, dated as
of October 1, 2003, by and among the Company, as Depositor and Master Servicer,
the Trustee and the Delaware Trustee, relating to the WaMu Mortgage Pass-Through
Certificates Series 2003-S11 Trust.
13
Principal Balance: As defined in the Pooling and Servicing Agreement.
Principal Distribution Amount: For any Distribution Date, an amount equal to the
portion of the Available Distribution Amount for that Distribution Date
remaining after the distributions pursuant to clause (I)(i) and (I)(ii) or
clause (II)(i) and (II)(ii), as applicable, of the definition of "Distribution
Amount."
Prior Period: With respect to any Distribution Date, the calendar month
immediately preceding such Distribution Date.
Pro Rata Allocation: As defined in the Pooling and Servicing Agreement.
Prospectus: The Prospectus, dated February 10, 2004, and the Prospectus
Supplement, dated April 27, 2004, of the Company.
Rating Agency: Initially, each of S&P and Fitch and thereafter, each nationally
recognized statistical rating organization that has rated the Certificates at
the request of the Company, or their respective successors in interest.
Ratings: As of any date of determination, the ratings, if any, of the
Certificates as assigned by the applicable Rating Agencies.
Record Date: The last Business Day of the month immediately preceding the month
of the related Distribution Date.
REMIC: A real estate mortgage investment conduit, as such term is defined in the
Code.
REMIC Provisions: Sections 860A through 860G of the Code, related Code
provisions and regulations promulgated thereunder, as the foregoing may be in
effect from time to time.
REMIC I: The segregated pool of assets of the Trust consisting of the REMIC I
Assets, which shall be a REMIC pursuant to the Code, with respect to which a
separate REMIC election is to be made and the beneficial interests in which
shall be the Certificates.
REMIC I Assets: All of the Trust Assets.
REMIC I Regular Interests: The Certificates (other than the Class R
Certificates).
Residual Certificates: The Class R Certificates.
Residual Distribution Amount: For any Distribution Date, any portion of the
Available Distribution Amount remaining after all distributions of the Available
Distribution Amount pursuant to clauses (I)(i) through (iv) and clauses (II)(i)
through (iii) of the definition of "Distribution Amount."
14
Upon termination of the obligations created by this Agreement and liquidation of
REMIC I, the amounts which remain on deposit in the Certificate Account after
payment to the Certificateholders of the amounts set forth in Section 9.01 of
this Agreement, and subject to the conditions set forth therein, shall be
distributed to the Class R Certificates in accordance with the preceding
sentences of this definition as if the date of such distribution were a
Distribution Date.
Responsible Officer: When used with respect to the Trustee or the Delaware
Trustee, any officer assigned to and working in the Corporate Trust Office (in
the case of the Trustee) or its corporate trust office (in the case of the
Delaware Trustee) or, in each case, in a similar group having direct
responsibility for the administration of this Agreement and also, with respect
to a particular matter, any other officer to whom such matter is referred
because of such officer's knowledge of and familiarity with the particular
subject.
S&P: Standard & Poor's Ratings Services, a division of The ▇▇▇▇▇▇-▇▇▇▇
Companies, Inc., provided that at any time it be a Rating Agency.
Secretary of State: The Secretary of State of the State of Delaware.
Securities Act: The Securities Act of 1933, as amended.
Statutory Trust Statute: Chapter 38 of Title 12 of the Delaware Code, 12
Del.C.ss.3801 et seq., as the same may be amended from time to time.
Step Down Percentage: For any Distribution Date, the percentage indicated below:
Distribution Date Occurring In Step Down Percentage
------------------------------ --------------------
May 2004 through April 2009 0%
May 2009 through April 2010 30%
May 2010 through April 2011 40%
May 2011 through April 2012 60%
May 2012 through April 2013 80%
May 2013 and after 100%
Tax Matters Person: A Holder of a Class R Certificate with a Percentage Interest
of at least 0.01% or any Permitted Transferee of such Class R Certificateholder
designated as succeeding to the position of Tax Matters Person in a notice to
the Trustee signed by authorized representatives of the transferor and
transferee of such Class R Certificate. The Company is hereby appointed to act
as the Tax Matters Person for REMIC I so long as it holds a Class R Certificate
with a Percentage Interest of at least 0.01%. The Company is hereby appointed to
act as agent for the Tax Matters Person for REMIC I, to perform the functions of
such Tax Matters Person as provided herein, so long as the Company is the
Certificate Administrator hereunder, in the event that the Company ceases to
hold a Class R Certificate with the required Percentage Interest. In the event
that the Company ceases to be the Certificate Administrator hereunder, the
successor Certificate Administrator is hereby appointed to act as agent for the
15
Tax Matters Person for REMIC I, to perform the functions of such Tax Matters
Person as provided herein. If the Tax Matters Person for REMIC I becomes a
Disqualified Organization, the last preceding Holder, that is not a Disqualified
Organization, of the Class R Certificate held by the Disqualified Organization
shall be Tax Matters Person pursuant to and as permitted by Section 5.01(c). If
any Person is appointed as tax matters person by the Internal Revenue Service
pursuant to the Code, such Person shall be Tax Matters Person.
Termination Date: The date upon which final payment of the Certificates will be
made pursuant to the procedures set forth in Section 9.01(b).
Termination Payment: The final payment delivered to the Certificateholders on
the Termination Date pursuant to the procedures set forth in Section 9.01(b).
Transfer: Any direct or indirect transfer or sale of any Ownership Interest in a
Residual Certificate.
Transferee: Any Person who is acquiring by Transfer any Ownership Interest in a
Residual Certificate.
Transferee Affidavit and Agreement: An affidavit and agreement in the form
attached hereto as Exhibit J.
Trust: WaMu Mortgage Pass-Through Certificates Series 2004-RS2 Trust, a Delaware
statutory trust, created pursuant to this Agreement.
Trust Assets: The following assets: (i) the Underlying Certificates and all
rights pertaining thereto; and (ii) such assets as from time to time may be held
by the Trust (or its duly appointed agent) in the Certificate Account (except
amounts representing the Certificate Administrator Fee).
Trustee: Citibank, N.A., or its successor-in-interest as provided in Section
8.09, or any successor trustee appointed as herein provided.
Underlying Certificates: $138,930,586 aggregate principal balance (as of the
Closing Date) of the WaMu Mortgage Pass-Through Certificates, Series 2003-S11
Certificates, Class 1-A, issued by the Underlying Trust pursuant to the Pooling
and Servicing Agreement.
Underlying Trust: WaMu Mortgage Pass-Through Certificates Series 2003-S11 Trust,
a Delaware statutory trust, created pursuant to the Pooling and Servicing
Agreement.
Underwriter: UBS Warburg.
U.S. Person: A citizen or resident of the United States, a corporation,
partnership or other entity created or organized in or under the laws of the
United States, any state thereof or the District of Columbia, or an estate or
trust that is subject to U.S. federal income tax regardless of the source of its
income.
16
ARTICLE II
Creation of the Trust; Conveyance of the Trust Assets;
REMIC Election and Designations;
Original Issuance of Certificates
Section 2.01. Creation of the Trust. The Trust is hereby created and shall be
known as "WaMu Mortgage Pass-Through Certificates Series 2004-RS2 Trust". The
purpose of the Trust is, and the Trust shall have the power and authority, to
engage in the following activities, all as provided by and subject to the terms
of this Agreement:
(i) to acquire, hold, lease, manage, administer, control, invest, reinvest,
operate and/or transfer the Trust Assets;
(ii) to issue the Certificates;
(iii) to make distributions to the Certificates; and
(iv) to engage in such other activities, including entering into agreements, as
are described in or required by the terms of this Agreement or as are necessary,
suitable or convenient to accomplish the foregoing or incidental thereto.
Citibank, N.A. is hereby appointed as a trustee of the Trust, to have all the
rights, duties and obligations of the Trustee with respect to the Trust
expressly set forth hereunder, and Citibank, N.A. hereby accepts such
appointment and the Trust created hereby. Christiana Bank & Trust Company is
hereby appointed as a Delaware trustee of the Trust, to have all the rights,
duties and obligations of the Delaware Trustee with respect to the Trust
hereunder, and Christiana Bank & Trust Company hereby accepts such appointment
and the Trust created hereby. It is the intention of the Company, the Trustee
and the Delaware Trustee that the Trust constitute a statutory trust under the
Statutory Trust Statute, that this Agreement constitute the governing instrument
of the Trust, and that this Agreement amend and restate the Original Trust
Agreement. The parties hereto acknowledge and agree that, prior to the execution
and delivery hereof, the Delaware Trustee has filed the Certificate of Trust.
The assets of the Trust shall remain in the custody of the Trustee, on behalf of
the Trust, and shall be owned by the Trust except as otherwise expressly set
forth herein. Moneys to the credit of the Trust shall be held by the Trustee and
invested as provided herein. All assets received and held in the Trust will not
be subject to any right, charge, security interest, lien or claim of any kind in
favor of either of Citibank, N.A. or Christiana Bank & Trust Company in its own
right, or any Person claiming through it. Neither the Trustee nor the Delaware
Trustee, on behalf of the Trust, shall have the power or authority to transfer,
assign, hypothecate, pledge or otherwise dispose of any of the assets of the
Trust to any Person, except as permitted herein. No creditor of a beneficiary of
the Trust, of the Trustee, of the Delaware Trustee, of the Certificate
Administrator or of the Company shall have any right to obtain possession of, or
otherwise exercise legal or equitable remedies with respect to, the property of
the Trust, except in accordance with the terms of this Agreement.
Section 2.02. Restrictions on Activities of the Trust. Notwithstanding any other
provision of this Agreement and any provision of law that otherwise so empowers
the Trust, so long as any Certificates are outstanding, the Trust shall not, and
none of the Trustee, the Delaware Trustee, the Company or the Certificate
Administrator shall knowingly cause the Trust to, do any of the following:
17
(i) engage in any business or activity other than those set forth in Section
2.01;
(ii) incur or assume any indebtedness except for such indebtedness that may be
incurred by the Trust in connection with the execution or performance of this
Agreement or any other agreement contemplated hereby;
(iii) guarantee or otherwise assume liability for the debts of any other party;
(iv) do any act in contravention of this Agreement or any other agreement
contemplated hereby to which the Trust is a party;
(v) do any act which would make it impossible to carry on the ordinary business
of the Trust;
(vi) confess a judgment against the Trust;
(vii) possess or assign the assets of the Trust for other than a Trust purpose;
(viii) cause the Trust to lend any funds to any entity, except as contemplated
by this Agreement; or
(ix) change the purposes and powers of the Trust from those set forth in this
Agreement.
Section 2.03. Separateness Requirements. Notwithstanding any other provision of
this Agreement and any provision of law that otherwise so empowers the Trust, so
long as any Certificates are outstanding, the Trust shall perform the following:
(i) except as expressly permitted by this Agreement, maintain its books,
records, bank accounts and files separate from those of any other Person;
(ii) except as expressly permitted by this Agreement, maintain its assets in its
own separate name and in such a manner that it is not costly or difficult to
segregate, identify, or ascertain such assets;
(iii) consider the interests of the Trust's creditors in connection with its
actions;
(iv) hold itself out to creditors and the public as a legal entity separate and
distinct from any other Person and correct any known misunderstanding regarding
its separate identity and refrain from engaging in any activity that compromises
the separate legal identity of the Trust;
(v) prepare and maintain separate records, accounts and financial statements in
accordance with generally accepted accounting principles, consistently applied,
and susceptible to audit. To the extent it is included in consolidated financial
statements or consolidated tax returns, such financial statements and tax
returns will reflect the separateness of the respective entities and indicate
that the assets of the Trust will not be available to satisfy the debts of any
other Person;
18
(vi) allocate and charge fairly and reasonably any overhead shared with any
other Person;
(vii) transact all business with affiliates on an arm's-length basis and
pursuant to written, enforceable agreements;
(viii) conduct business solely in the name of the Trust. In that regard all
written and oral communications of the Trust, including, without limitation,
letters, invoices, purchase orders and contracts, shall be made solely in the
name of the Trust;
(ix) maintain a separate office through which its business shall be conducted,
provided that such office may be an office of the Trustee, which office shall
not be shared with the Company or any affiliates of the Company;
(x) in the event that services have been or are in the future performed or paid
by any Person on behalf of the Trust (other than the Trustee, the Delaware
Trustee, the Certificate Administrator or the Tax Matters Person as permitted
herein), reimburse such Person, as applicable, for the commercially reasonable
value of such services or expenses provided or incurred by such Person.
Accordingly, (i) the Trust shall reimburse such Person, as applicable, for the
commercially reasonable value of such services or expenses provided or incurred
by such Person; (ii) to the extent invoices for such services are not allocated
and separately billed to the Trust, the amount thereof that was or is to be
allocated and separately billed to the Trust was or will be reasonably related
to the services provided to the Trust; and (iii) any other allocation of direct,
indirect or overhead expenses for items shared between the Trust and any other
Person, was or will be, to the extent practicable, allocated on the basis of
actual use or value of services rendered or otherwise on a basis reasonably
related to actual use or the value of services rendered;
(xi) except as expressly permitted by this Agreement, not commingle its assets
or funds with those of any other Person;
(xii) except as expressly permitted by this Agreement, not assume, guarantee, or
pay the debts or obligations of any other Person;
(xiii) except as expressly permitted by this Agreement, not pledge its assets
for the benefit of any other Person;
(xiv) not hold out its credit or assets as being available to satisfy the
obligations of others;
(xv) pay its liabilities only out of its funds;
19
(xvi) pay the salaries of its own employees, if any; and
(xvii) cause the agents and other representatives of the Trust, if any, to act
at all times with respect to the Trust consistently and in furtherance of the
foregoing.
None of the Trustee, the Delaware Trustee, the Company or the Certificate
Administrator shall take any action that is inconsistent with the purposes of
the Trust or Section 2.02 or Section 2.03. Neither the Company nor the
Certificate Administrator shall direct the Trustee or the Delaware Trustee to
take any action that is inconsistent with the purposes of the Trust or Section
2.02 or Section 2.03.
Section 2.04. Conveyance of Trust Assets; Security Interest.
Concurrently with the execution and delivery hereof, the Company does hereby
irrevocably sell, transfer, assign, set over and otherwise convey to the Trust,
without recourse, all the Company's right, title and interest in and to the
Underlying Certificates (such transfer and assignment by the Company to be
referred to herein as the "Conveyance"). The Company shall cause the Underwriter
to cause DTC to transfer the Underlying Certificates directly to the Trustee.
It is the express intent of the parties hereto that the Conveyance of the Trust
Assets to the Trust by the Company as provided in this Section 2.04 be, and be
construed as, an absolute sale of the Trust Assets. It is, further, not the
intention of the parties that such Conveyance be deemed the grant of a security
interest in the Trust Assets by the Company to the Trust to secure a debt or
other obligation of the Company. However, in the event that, notwithstanding the
intent of the parties, the Trust Assets are held to be the property of the
Company, or if for any other reason this Agreement is held or deemed to create a
security interest in the Trust Assets, then
(a) this Agreement shall constitute a security agreement;
(b) the conveyance provided for in this Section 2.04 shall be deemed to be a
grant by the Company to the Trust of, and the Company hereby grants to the
Trust, to secure all of the Company's obligations hereunder, a security interest
in all of the Company's right, title, and interest, whether now owned or
hereafter acquired, in and to:
(I) The Trust Assets;
(II) All accounts, chattel paper, deposit accounts, documents, general
intangibles, goods, instruments, investment property, letter-of-credit rights,
letters of credit, money, and oil, gas, and other minerals, consisting of,
arising from, or relating to, any of the foregoing; and
(III) All proceeds of the foregoing.
The Company shall file such financing statements, and the Company and the
Trustee acting on behalf of the Trust at the direction of the Company shall, to
the extent consistent with this Agreement, take such other actions as may be
necessary to ensure that, if this Agreement were found to create a security
interest in the Trust Assets, such security interest would be a perfected
20
security interest of first priority under applicable law and will be maintained
as such throughout the term of the Agreement. In connection herewith, the Trust
shall have all of the rights and remedies of a secured party and creditor under
the Uniform Commercial Code as in force in the relevant jurisdiction.
Section 2.05. [Reserved].
Section 2.06. REMIC Election for REMIC I.
The Tax Matters Person, shall, on behalf of REMIC I, elect to treat REMIC I as a
REMIC within the meaning of Section 860D of the Code and, if necessary, under
applicable state laws. Such election shall be included in the Form 1066 and any
appropriate state return to be filed on behalf of REMIC I for its first taxable
year.
The Closing Date is hereby designated as the "startup day" of REMIC I within the
meaning of Section 860G(a)(9) of the Code.
The regular interests (as set forth in the table contained in the Preliminary
Statement hereto) relating to REMIC I are hereby designated as "regular
interests" in REMIC I for purposes of Section 860G(a)(1) of the Code. The Class
R Certificates are hereby designated as the sole class of "residual interest" in
REMIC I for purposes of Section 860G(a)(2) of the Code.
The parties intend that the affairs of REMIC I shall constitute, and that the
affairs of REMIC I shall be conducted so as to qualify REMIC I as a REMIC. In
furtherance of such intention, the Tax Matters Person shall, on behalf of REMIC
I: (a) prepare and file, or cause to be prepared and filed, a federal tax return
using a calendar year as the taxable year and using an accrual method of
accounting for REMIC I when and as required by the REMIC Provisions and other
applicable federal income tax laws; (b) make an election, on behalf of the
trust, for REMIC I to be treated as a REMIC on the federal tax return of REMIC I
for its first taxable year, in accordance with the REMIC Provisions; (c) prepare
and forward, or cause to be prepared and forwarded, to the Certificateholders
and the Trustee, all information reports as and when required to be provided to
them in accordance with the REMIC Provisions, and make available the information
necessary for the application of Section 860E(e) of the Code; (d) conduct the
affairs of REMIC I at all times that any REMIC I Regular Interests are
outstanding so as to maintain the status of REMIC I as a REMIC under the REMIC
Provisions; (e) not knowingly or intentionally take any action or omit to take
any action that would cause the termination of the REMIC status of REMIC I; and
(f) pay the amount of any federal prohibited transaction penalty taxes imposed
on REMIC I when and as the same shall be due and payable (but such obligation
shall not prevent the Company or any other appropriate person from contesting
any such tax in appropriate proceedings and shall not prevent the Company from
withholding payment of such tax, if permitted by law, pending the outcome of
such proceedings); provided, that the Company shall be entitled to be
indemnified by REMIC I for any such prohibited transaction penalty taxes if the
Company's failure to exercise reasonable care was not the primary cause of the
imposition of such prohibited transaction penalty taxes.
The Trustee and the Certificate Administrator shall promptly provide the Company
with such information in the possession of the Trustee or the Certificate
21
Administrator, respectively, as the Company may from time to time request for
the purpose of enabling the Company to prepare tax returns. If so requested by
the Tax Matters Person, the Trustee shall sign tax returns on behalf of the
REMIC.
In the event that any tax is imposed on "prohibited transactions" of REMIC I as
defined in Section 860F of the Code and not paid by the Company pursuant to
clause (f) of the second preceding paragraph, such tax shall be charged against
amounts otherwise distributable to the Class R Certificates. Notwithstanding
anything to the contrary contained herein, the Trustee is hereby authorized to
retain from amounts otherwise distributable to the Class R Certificates on any
Distribution Date sufficient funds to reimburse the Tax Matters Person (or any
agent therefor appointed in accordance with the definition of "Tax Matters
Person" herein, if applicable), for the payment of such tax (upon the written
request of the Tax Matters Person or its agent, to the extent reimbursable, and
to the extent that the Tax Matters Person or its agent has not been previously
reimbursed therefor).
Section 2.07. [Reserved].
Section 2.08. Representations and Warranties of the Company. The Company hereby
represents and warrants to the Trust that immediately prior to the conveyance of
the Underlying Certificates pursuant to Section 2.04 herein, the Company had
good title to, and was the sole owner of, the Underlying Certificates free and
clear of any pledge, lien, encumbrance or security interest and such conveyance
validly transfers ownership of the Underlying Certificate to the Trustee free
and clear of any pledge, lien, encumbrance or security interest.
Section 2.09. Acknowledgment of Transfer of Trust Assets. The Trustee hereby
acknowledges and accepts on behalf of the Trust the transfer and assignment to
the Trust of the Trust Assets, and declares that as of the Closing Date it holds
and shall hold any documents constituting a part of the Trust Assets, and the
Trust Assets, as Trustee in trust, upon the trust herein set forth, for the use
and benefit of all present and future Certificateholders. In connection
therewith, as of the Closing Date, in exchange for the Trust Assets, the Trustee
on behalf of the Trust does hereby issue to the Company the REMIC I Regular
Interests and the Class R-1 Residual Interest.
Section 2.10. Legal Title. Legal title to all assets of the Trust shall be
vested at all times in the Trust as a separate legal entity.
Section 2.11. Compliance with ERISA Requirements. For purposes of ensuring
compliance with the requirements of the "underwriter's exemption" (U.S.
Department of Labor Prohibited Transaction Exemption 2002-41, 67 Fed. Reg. 54487
(Aug. 22, 2002)), issued under ERISA, and for the avoidance of any doubt as to
the applicability of other provisions of this Agreement, to the extent permitted
by applicable law and except as contemplated by this Agreement, (1) the Trust
shall not be a party to any merger, consolidation or reorganization, or
liquidate or sell its assets and (2) so long as any Certificates are
outstanding, none of the Company, the Trustee or the Delaware Trustee shall
institute against the Trust, or join in any institution against the Trust of,
any bankruptcy or insolvency proceedings under any federal or state bankruptcy,
insolvency or similar law.
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ARTICLE III
Administration of the Underlying Certificates
Section 3.01. The Company to Act as Certificate Administrator. The Company shall
act as Certificate Administrator on behalf of the Trust and for the benefit of
the Certificateholders in accordance with the terms hereof. The Certificate
Administrator shall make reasonable efforts to collect or cause to be collected
all payments called for under the terms and provisions of the Underlying
Certificates. The Certificate Administrator hereby undertakes to collect and
remit to the Trustee for deposit in the Certificate Account all amounts due with
respect to the Underlying Certificates, to the extent not remitted directly to
the Trustee under the Pooling and Servicing Agreement. The Certificate
Administrator may perform its administrative responsibilities through agents or
independent contractors, but shall not thereby be released from any of its
responsibilities hereunder and the Certificate Administrator shall diligently
pursue all of its rights against such agents or independent contractors.
Section 3.02. [Reserved].
Section 3.03. [Reserved].
Section 3.04. The Certificate Account. On or prior to the Closing Date, the
Trustee shall establish the Certificate Account, which shall be entitled
"Washington Mutual Mortgage Securities Corp. Certificate Account under the
Amended and Restated Trust Agreement, dated as of April 29, 2004, among
Washington Mutual Mortgage Securities Corp., as Depositor and Certificate
Administrator, Citibank, N.A., as the Trustee, and Christiana Bank & Trust
Company, as the Delaware Trustee, for the benefit of WaMu Mortgage Pass-Through
Certificates Series 2004-RS2 Trust created pursuant thereto". Promptly after the
Closing Date, the Trustee shall communicate to the Certificate Administrator the
account number and wiring instructions for the Certificate Account. The Trustee
shall deposit or cause to be deposited in the Certificate Account, upon receipt,
all payments and other collections received on or in respect of the Underlying
Certificates subsequent to the Closing Date. In addition, the Certificate
Administrator shall deposit into the Certificate Account any amounts paid by the
Certificate Administrator in connection with the exercise of its option to
terminate this Agreement pursuant to Section 9.01.
Section 3.05. [Reserved].
Section 3.06. [Reserved].
Section 3.07. [Reserved].
Section 3.08. [Reserved].
Section 3.09. Compliance with Federal Withholding Requirements. Notwithstanding
any other provision of this Agreement, the Certificate Administrator and the
Trustee, as applicable, shall comply with all federal withholding requirements
with respect to payments to Certificateholders of interest or original issue
discount that the Certificate Administrator or the Trustee reasonably believes
are applicable under the Code. The consent of Certificateholders shall not be
required for any such withholding. Without limiting the foregoing, the
Certificate Administrator agrees that it will not withhold with respect to
23
payments of interest or original issue discount in the case of a
Certificateholder that has furnished or caused to be furnished an effective Form
W-8 or an acceptable substitute form or a successor form and who is not a "10
percent shareholder" within the meaning of Code Section 871(h)(3)(B) or a
"controlled foreign corporation" described in Code Section 881(c)(3)(C) with
respect to REMIC I or the depositor. In the event the Trustee withholds any
amount from interest or original issue discount payments or advances thereof to
any Certificateholder pursuant to federal withholding requirements, the Trustee
shall indicate the amount withheld to such Certificateholder.
Section 3.10. [Reserved].
Section 3.11. Compensation to the Certificate Administrator. As compensation for
its activities hereunder, the Certificate Administrator shall be entitled to
receive the Certificate Administrator Fee pursuant to Section 4.01. The
Certificate Administrator shall be required to pay all expenses incurred by it
in connection with its activities hereunder and shall not be entitled to
reimbursement therefor, except as specifically provided herein.
Section 3.12. Reports to the Trustee; Certificate Account Statement. Not later
than 15 days after each Distribution Date, the Certificate Administrator shall
forward a statement, certified by an Administrative Officer, to the Trustee
setting forth the status of the Certificate Account as of the close of business
on such Distribution Date and showing, for the period covered by such statement,
the aggregate of deposits into and withdrawals from the Certificate Account for
each category of deposit specified in Section 3.04 and each category of
withdrawal specified in Section 3.05, and stating that all distributions
required by this Agreement have been made (or if any required distribution has
not been made, specifying the nature and amount thereof). The Trustee shall make
available such statements to any Certificateholder upon request at the expense
of the Certificate Administrator.
Section 3.13. Annual Statement as to Compliance. The Certificate Administrator
shall deliver to the Trustee, on or before April 30 of each year, beginning with
the first April 30 succeeding the Cut-Off Date by at least six months, an
Officer's Certificate stating as to the signer thereof, that (i) a review of the
activities of the Certificate Administrator during the preceding calendar year
and performance under this Agreement has been made under such officer's
supervision, and (ii) to the best of such officer's knowledge, based on such
review, the Certificate Administrator has fulfilled all its obligations under
this Agreement throughout such year, or, if there has been a default in the
fulfillment of any such obligation, specifying each such default known to such
officer and the nature and status thereof. Copies of such statement shall be
provided by the Certificate Administrator to Certificateholders upon request or
by the Trustee (solely to the extent that such copies are available to the
Trustee) at the expense of the Certificate Administrator, should the Certificate
Administrator fail to so provide such copies.
Section 3.14. [Reserved].
Section 3.15. Annual Independent Public Accountants' Servicing Report. On or
before April 30 of each year, beginning with the first April 30 succeeding the
Cut-Off Date by at least six months, the Certificate Administrator, at its
expense, shall cause a firm of independent public accountants to furnish a
24
statement to the Trustee to the effect that, in connection with the firm's
examination of the financial statements as of the previous December 31 of the
Certificate Administrator's parent corporation (which shall include a limited
examination of the Certificate Administrator's financial statements), nothing
came to their attention that indicated that the Certificate Administrator was
not in compliance with Section 3.02, Section 3.03, Section 3.04, Section 3.05,
Section 3.11, Section 3.12 and Section 3.13 of this Agreement, except for (i)
such exceptions as such firm believes to be immaterial, and (ii) such other
exceptions as are set forth in such statement.
ARTICLE IV
Payments to Certificateholders; Payment of Expenses
Section 4.01. Distributions to Certificateholders; Payment of Certificate
Administrator Fee.
(a) On each Distribution Date, the Trustee (or any duly appointed paying agent)
shall (i) withdraw from the Certificate Account the Certificate Administrator
Fee payable on such Distribution Date and pay such amount to the Certificate
Administrator and (ii) withdraw from the Certificate Account the Available
Distribution Amount for such Distribution Date and distribute, from the amount
so withdrawn, to the extent of the Available Distribution Amount, the
Distribution Amount to the Certificateholders, all in accordance with the
written statement received from the Certificate Administrator pursuant to
Section 4.02. Amounts distributed to the Certificateholders pursuant to clause
(ii) above shall be distributed by wire transfer in immediately available funds
for the account of, or by check mailed to, each such Certificateholder of record
on the immediately preceding Record Date (other than as provided in Section 9.01
respecting the final distribution), as specified by each such Certificateholder
and at the address of such Holder appearing in the Certificate Register.
(b) All reductions in the Certificate Principal Balance of a Certificate
effected by distributions of principal and all allocations of Allocated Realized
Losses made on any Distribution Date shall be binding upon all Holders of such
Certificate and of any Certificate issued upon the registration of transfer or
exchange therefor or in lieu thereof, whether or not such distribution is noted
on such Certificate. The final distribution of principal of each Certificate
(and the final distribution upon the Class R Certificates upon (i) the
termination of REMIC I and (ii) the payment, or making provision for payment, of
all liabilities of the Trust) shall be payable in the manner provided above only
upon presentation and surrender thereof on or after the Distribution Date
therefor at the office or agency of the Certificate Registrar specified in the
notice delivered pursuant to Section 4.01(c)(ii) and Section 9.01(b).
(c) Whenever the Certificate Administrator has notified the Trustee that it
believes that the entire remaining unpaid Class Principal Balance of any Class
of Certificates will become distributable on the next Distribution Date, the
Trustee shall, no later than the 18th day of the month of such Distribution
Date, mail or cause to be mailed to each Person in whose name a Certificate to
be so retired is registered at the close of business on the Record Date and to
the Rating Agencies a notice to the effect that:
25
(i) it is expected that funds sufficient to make such final distribution will be
available in the Certificate Account on such Distribution Date, and
(ii) if such funds are available, (A) such final distribution will be payable on
such Distribution Date, but only upon presentation and surrender of such
Certificate at the office or agency of the Certificate Registrar maintained for
such purpose (the address of which shall be set forth in such notice), and (B)
no interest shall accrue on such Certificate after such Distribution Date.
Section 4.02. Distribution Reports to the Trustee. Prior to noon New York City
time two Business Days prior to each Distribution Date, the Certificate
Administrator shall provide (x) the Trustee and (y) the Company (if the Company
is no longer acting as Certificate Administrator) with a statement in writing of
(1) the amount, as applicable, of (i) interest, (ii) the interest portion, if
any, of Allocated Realized Losses, (iii) Allocated Uncompensated Interest
Shortfall, (iv) principal, (v) the principal portion of Allocated Realized
Losses and (vi) the Residual Distribution Amount to be distributed or allocated,
as applicable, to each Class of Certificates on such Distribution Date (such
amounts to be determined in accordance with the definition of "Distribution
Amount" and Section 4.01 hereof and other related definitions set forth in
Article I hereof); and (2) the applicable Class Principal Balance after giving
effect to such distributions and allocations.
Section 4.03. [Reserved.]
Section 4.04. Statements to Certificateholders. The Trustee shall make available
the statement required by Section 4.02, and may make available certain other
information, including, without limitation, information required to be provided
by the Trustee pursuant to Sections 3.12 and 3.13, to Certificateholders and
each Rating Agency through the Trustee's Corporate Trust home page on the world
wide web. Such web page is currently located at "▇▇▇.▇▇.▇▇▇▇▇▇▇▇▇▇.▇▇▇." The
location of such web page and the procedures used therein are subject to change
from time to time at the Trustee's discretion. Certificateholders can also reach
the customer service desk by phone at ▇-▇▇▇-▇▇▇-▇▇▇▇.
Upon request by any Certificateholder or Rating Agency or the Trustee, the
Certificate Administrator shall forward to such Certificateholder or Rating
Agency, the Trustee and the Company (if the Company is no longer acting as
Certificate Administrator) an additional report which sets forth with respect to
the Mortgage Loans:
(a) The information set forth in Section 4.06(a) through (e) of the Pooling and
Servicing Agreement; and
(b) The cumulative amount of Allocated Realized Losses allocated to the
Certificates since the Closing Date.
The Company may make available any reports, statements or other information to
Certificateholders through the Company's home page on the world wide web. As of
the Closing Date, such web page is located at "▇▇▇.▇▇▇▇▇▇▇.▇▇▇" and information
is available by clicking on "Investor Information."
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ARTICLE V
The Certificates
Section 5.01. The Certificates.
(a) The Certificates shall be substantially in the forms set forth in Exhibit A
and B with the additional insertion from Exhibit H attached hereto, and shall be
executed by the Trustee on behalf of the Trust, authenticated by the Trustee (or
any duly appointed Authenticating Agent) and delivered (i) upon and pursuant to
the order of the Company and (ii) upon receipt by the Trustee of the documents
specified in Section 2.01. The Certificates shall be issuable in Authorized
Denominations. Certificates shall be executed by manual or facsimile signature
on behalf of the Trust by authorized officers of the Trustee. Certificates
bearing the manual or facsimile signatures of individuals who were at the time
of execution the proper officers of the Trustee shall bind the Trust,
notwithstanding that such individuals or any of them have ceased to hold such
offices prior to the authentication and delivery of such Certificates or did not
hold such offices at the date of such Certificates. No Certificate shall be
entitled to any benefit under this Agreement, or be valid for any purpose,
unless there appears on such Certificate a certificate of authentication
substantially in the form provided for herein executed by the Trustee or any
Authenticating Agent by manual signature, and such certificate 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.
(b) The following definitions apply for purposes of this Section 5.01:
"Disqualified Organization" means any Person which is not a Permitted
Transferee, but does not include any "Pass-Through Entity" which owns or holds a
Residual Certificate and of which a Disqualified Organization, directly or
indirectly, may be a stockholder, partner or beneficiary; "Pass-Through Entity"
means any regulated investment company, real estate investment trust, common
trust fund, partnership, trust or estate, and any organization to which Section
1381 of the Code applies; "Ownership Interest" means, with respect to any
Residual Certificate, any ownership or security interest in such Residual
Certificate, including any interest in a Residual Certificate as the Holder
thereof and any other interest therein whether direct or indirect, legal or
beneficial, as owner or as pledgee; "Transfer" means any direct or indirect
transfer or sale of, or directly or indirectly transferring or selling any
Ownership Interest in a Residual Certificate; and "Transferee" means any Person
who is acquiring by Transfer any Ownership Interest in a Residual Certificate.
(c) Restrictions on Transfers of the Residual Certificates to Disqualified
Organizations are set forth in this Section 5.01(c).
(i) Each Person who has or who acquires any Ownership Interest in a Residual
Certificate shall be deemed by the acceptance or acquisition of such Ownership
Interest to have agreed to be bound by the following provisions and to have
irrevocably authorized the Trustee or its designee under clause (iii)(A) below
to deliver payments to a Person other than such Person and to negotiate the
27
terms of any mandatory sale under clause (iii)(B) below and to execute all
instruments of transfer and to do all other things necessary in connection with
any such sale. The rights of each Person acquiring any Ownership Interest in a
Residual Certificate are expressly subject to the following provisions:
(A) Each Person holding or acquiring any Ownership Interest in a Residual
Certificate shall be a Permitted Transferee and shall promptly notify the
Trustee of any change or impending change in its status as a Permitted
Transferee.
(B) In connection with any proposed Transfer of any Ownership Interest in a
Residual Certificate to a U.S. Person, the Trustee shall require delivery to it,
and shall not register the Transfer of any Residual Certificate until its
receipt of (1) an affidavit and agreement (a "Transferee Affidavit and
Agreement") attached hereto as Exhibit J from the proposed Transferee, in form
and substance satisfactory to the Company, representing and warranting, among
other things, that it is not a Non-U.S. Person, that such transferee is a
Permitted Transferee, that it is not acquiring its Ownership Interest in the
Residual Certificate that is the subject of the proposed Transfer as a nominee,
trustee or agent for any Person who is not a Permitted Transferee, that for so
long as it retains its Ownership Interest in a Residual Certificate, it will
endeavor to remain a Permitted Transferee, and that it has reviewed the
provisions of this Section 5.01(c) and agrees to be bound by them, and (2) a
certificate, attached hereto as Exhibit I, from the Holder wishing to transfer
the Residual Certificate, in form and substance satisfactory to the Company,
representing and warranting, among other things, that no purpose of the proposed
Transfer is to allow such Holder to impede the assessment or collection of tax.
(C) Notwithstanding the delivery of a Transferee Affidavit and Agreement by a
proposed Transferee under clause (B) above, if the Trustee has actual knowledge
that the proposed Transferee is not a Permitted Transferee, no Transfer of an
Ownership Interest in a Residual Certificate to such proposed Transferee shall
be effected.
(D) Each Person holding or acquiring any Ownership Interest in a Residual
Certificate agrees by holding or acquiring such Ownership Interest (i) to
require a Transferee Affidavit and Agreement from any other Person to whom such
Person attempts to transfer its Ownership Interest and to provide a certificate
to the Trustee in the form attached hereto as Exhibit J; (ii) to obtain the
express written consent of the Company prior to any transfer of such Ownership
Interest, which consent may be withheld in the Company's sole discretion; and
(iii) to provide a certificate to the Trustee in the form attached hereto as
Exhibit I.
(ii) The Trustee shall register the Transfer of any Residual Certificate only if
it shall have received the Transferee Affidavit and Agreement, a certificate of
the Holder requesting such transfer in the form attached hereto as Exhibit J and
all of such other documents as shall have been reasonably required by the
Trustee as a condition to such registration.
28
(iii) (A) If any "disqualified organization" (as defined in Section 860E(e)(5)
of the Code) shall become a holder of a Residual Certificate, then the last
preceding Permitted Transferee shall be restored, to the extent permitted by
law, to all rights and obligations as Holder thereof retroactive to the date of
registration of such Transfer of such Residual Certificate. If any Non-U.S.
Person shall become a holder of a Residual Certificate, then the last preceding
holder which is a U.S. Person shall be restored, to the extent permitted by law,
to all rights and obligations as Holder thereof retroactive to the date of
registration of the Transfer to such Non-U.S. Person of such Residual
Certificate. If a transfer of a Residual Certificate is disregarded pursuant to
the provisions of Treasury Regulations Section 1.860E-1 or Section 1.860G-3,
then the last preceding Permitted Transferee shall be restored, to the extent
permitted by law, to all rights and obligations as Holder thereof retroactive to
the date of registration of such Transfer of such Residual Certificate. Neither
the Trust nor the Trustee shall be under any liability to any Person for any
registration of Transfer of a Residual Certificate that is in fact not permitted
by this Section 5.01(c) or for making any payments due on such Certificate to
the holder thereof or for taking any other action with respect to such holder
under the provisions of this Agreement.
(B) If any purported Transferee shall become a Holder of a Residual Certificate
in violation of the restrictions in this Section 5.01(c) and to the extent that
the retroactive restoration of the rights of the Holder of such Residual
Certificate as described in clause (iii)(A) above shall be invalid, illegal or
unenforceable, then the Company shall have the right, without notice to the
Holder or any prior Holder of such Residual Certificate, to sell such Residual
Certificate to a purchaser selected by the Company on such terms as the Company
may choose. Such purported Transferee shall promptly endorse and deliver each
Residual Certificate in accordance with the instructions of the Company. Such
purchaser may be the Company itself or any affiliate of the Company. The
proceeds of such sale, net of the commissions (which may include commissions
payable to the Company or its affiliates), expenses and taxes due, if any, shall
be remitted by the Company to such purported Transferee. The terms and
conditions of any sale under this clause (iii)(B) shall be determined in the
sole discretion of the Company, and the Company shall not be liable to any
Person having an Ownership Interest in a Residual Certificate as a result of its
exercise of such discretion.
(iv) The Company, on behalf of the Trustee, shall make available, upon written
request from the Trustee, all information necessary to compute any tax imposed
(A) as a result of the Transfer of an Ownership Interest in a Residual
Certificate to any Person who is not a Permitted Transferee, including the
information regarding "excess inclusions" of such Residual Certificates required
to be provided to the Internal Revenue Service and certain Persons as described
in Treasury Regulation Section 1.860D-1(b)(5), and (B) as a result of any
regulated investment company, real estate investment trust, common trust fund,
partnership, trust, estate or organizations described in Section 1381 of the
Code having as among its record holders at any time any Person who is not a
Permitted Transferee. Reasonable compensation for providing such information may
be required by the Company from such Person.
29
(v) The provisions of this Section 5.01 set forth prior to this Section (v) may
be modified, added to or eliminated by the Company and the Trustee, provided
that there shall have been delivered to the Trustee the following:
(A) written notification from each of the Rating Agencies to the effect that the
modification, addition to or elimination of such provisions will not cause such
Rating Agency to downgrade its then-current Ratings of the Certificates; and
(B) an Opinion of Counsel, in form and substance satisfactory to the Company (as
evidenced by a certificate of the Company), to the effect that such
modification, addition to or absence of such provisions will not cause REMIC I
to cease to qualify as a REMIC and will not create a risk that (1) REMIC I may
be subject to an entity-level tax caused by the Transfer of any Residual
Certificate to a Person which is not a Permitted Transferee or (2) a
Certificateholder or another Person will be subject to a REMIC-related tax
caused by the Transfer of a Residual Certificate to a Person which is not a
Permitted Transferee. (vi) The following legend shall appear on all Residual
Certificates:
ANY RESALE, TRANSFER OR OTHER DISPOSITION OF THIS CERTIFICATE MAY BE MADE ONLY
IF THE PROPOSED TRANSFEREE PROVIDES A TRANSFER AFFIDAVIT TO THE COMPANY AND THE
TRUSTEE THAT (1) SUCH TRANSFEREE IS NOT EITHER (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 ENABLE THE TRANSFEROR TO
IMPEDE THE ASSESSMENT OR COLLECTION OF TAX. SUCH AFFIDAVIT SHALL INCLUDE CERTAIN
REPRESENTATIONS AS TO THE FINANCIAL CONDITION OF THE PROPOSED TRANSFEREE.
NOTWITHSTANDING THE REGISTRATION IN THE CERTIFICATE REGISTER OF 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
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NOT LIMITED TO, THE RECEIPT OF DISTRIBUTIONS ON THIS CERTIFICATE. EACH HOLDER OF
THE CLASS R CERTIFICATE BY ACCEPTANCE OF THIS CERTIFICATE SHALL BE DEEMED TO
HAVE CONSENTED TO THE PROVISIONS OF THIS PARAGRAPH.
(vii) The Tax Matters Person for REMIC I, while not a Disqualified Organization,
shall be the tax matters person for the related REMIC within the meaning of
Section 6231(a)(7) of the Code and Treasury Regulation Section 1.860F-4(d).
(d) In the case of any Residual Certificate presented for registration in the
name of any Person, the Trustee shall require (i) a Transferee Affidavit and
Agreement which includes the representation set forth in paragraph 18 of the
form attached hereto as Exhibit J and (ii) only if the representation set forth
in such paragraph 18 indicates that a Benefit Plan Opinion is delivered in
connection therewith, a Benefit Plan Opinion.
Section 5.02. Certificates Issuable in Classes; Distributions of Principal and
Interest; Authorized Denominations. The aggregate principal amount of the
Certificates that may be authenticated and delivered under this Agreement is
limited to the aggregate Class Principal Balance of the Underlying Certificates
as of the Closing Date, as specified in the Preliminary Statement to this
Agreement, except for Certificates authenticated and delivered upon registration
of transfer of, or in exchange for, or in lieu of, other Certificates pursuant
to Section 5.03. Such aggregate principal amount shall be allocated among one or
more Classes having designations, types of interests, initial per annum
Certificate Interest Rates, initial Class Principal Balances and Final Maturity
Dates as specified in the Preliminary Statement to this Agreement. The aggregate
Percentage Interest of each Class of Certificates of which the Class Principal
Balance equals zero as of the Cut-Off Date that may be authenticated and
delivered under this Agreement is limited to 100%. Certificates shall be issued
in Authorized Denominations.
Section 5.03. Registration of Transfer and Exchange of Certificates. The Trustee
shall cause to be maintained at one of its offices or at its designated agent, a
Certificate Register in which there shall be recorded the name and address of
each Certificateholder. Subject to such reasonable rules and regulations as the
Trustee may prescribe, the Certificate Register shall be amended from time to
time by the Trustee or its agent to reflect notice of any changes received by
the Trustee or its agent pursuant to Section 10.06. The Trustee hereby appoints
itself as the initial Certificate Registrar.
Upon surrender for registration of transfer of any Certificate to the Trustee at
the Corporate Trust Office of the Trustee, or such other address or agency as
may hereafter be provided to the Certificate Administrator in writing by the
Trustee, the Trustee shall execute, and the Trustee or any Authenticating Agent
shall authenticate and deliver, in the name of the designated transferee or
transferees, one or more new Certificates of Authorized Denominations. At the
option of the Certificateholders, Certificates may be exchanged for other
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Certificates in Authorized Denominations of like Certificate Principal Balance
or Percentage Interest, as applicable, upon surrender of the Certificates to be
exchanged at any such office or agency. Whenever any Certificates are so
surrendered for exchange, the Trustee on behalf of the Trust shall execute, and
the Trustee, or any Authenticating Agent, shall authenticate and deliver, the
Certificates which the Certificateholder making the exchange is entitled to
receive. Every Certificate presented or surrendered for transfer shall (if so
required by the Trustee or any Authenticating Agent) be duly endorsed by, or be
accompanied by a written instrument of transfer in form satisfactory to the
Trustee or any Authenticating Agent and duly executed by, the Holder thereof or
such Holder's attorney duly authorized in writing.
A reasonable service charge may be made for any such exchange or transfer of
Certificates, and the Trustee may require payment of a sum sufficient to cover
any tax or governmental charge that may be imposed in connection with any
exchange or transfer of Certificates.
All Certificates surrendered for exchange or transfer shall be cancelled by the
Trustee or any Authenticating Agent.
Section 5.04. Mutilated, Destroyed, Lost or Stolen Certificates. If (i) any
mutilated Certificate is surrendered to the Trustee or any Authenticating Agent,
or (ii) the Trustee or any Authenticating Agent receives evidence to their
satisfaction of the destruction, loss or theft of any Certificate, and there is
delivered to the Trustee or any Authenticating Agent such security or indemnity
as may be required by them to save each of them and the Trust harmless, then, in
the absence of notice to the Trustee or any Authenticating Agent that such
Certificate has been acquired by a protected purchaser, the Trustee shall
execute and the Trustee or any Authenticating Agent shall authenticate and
deliver, in exchange for or in lieu of any such mutilated, destroyed, lost or
stolen Certificate, a new Certificate of like Certificate Principal Balance or
Percentage Interest as applicable. Upon the issuance of any new Certificate
under this Section 5.04, the Trustee or any Authenticating Agent 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 or any Authenticating Agent) connected therewith.
Any replacement Certificate issued pursuant to this Section 5.04 shall
constitute complete and indefeasible evidence of ownership in REMIC I as if
originally issued, whether or not the lost or stolen Certificate shall be found
at any time.
Section 5.05. Persons Deemed Owners. The Company, the Certificate Administrator,
the Trust, the Trustee, the Delaware Trustee and any agent of any of them may
treat the Person in whose name any Certificate is registered as the owner of
such Certificate for the purpose of receiving distributions pursuant to Section
4.01 for all other purposes whatsoever, and neither the Company, the Certificate
Administrator, the Trust, the Trustee, the Delaware Trustee, the Certificate
Registrar nor any agent of the Company, the Certificate Administrator, the
Trust, the Trustee or the Delaware Trustee shall be affected by notice to the
contrary.
Section 5.06. Temporary Certificates. Upon the initial issuance of the
Certificates, the Trustee on behalf of the Trust may execute, and the Trustee or
any Authenticating Agent shall authenticate and deliver, temporary Certificates
which are printed, lithographed, typewritten or otherwise produced, in any
Authorized Denomination, of the tenor of the definitive Certificates in lieu of
which they are issued and with such variations in form from the forms of the
Certificates set forth as Exhibits A and H hereto as the Trustee's officers
executing such Certificates may determine, as evidenced by their execution of
the Certificates. Notwithstanding the foregoing, the Certificates may remain in
the form of temporary Certificates.
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If temporary Certificates are issued, the Trustee shall cause definitive
Certificates to be prepared within ten Business Days after the Closing Date or
as soon as practicable thereafter. After preparation of definitive Certificates,
the temporary Certificates shall be exchangeable for definitive Certificates
upon surrender of the temporary Certificates at the office or agency of the
Trustee to be maintained as provided in Section 5.10 hereof, without charge to
the holder. Any tax or governmental charge that may be imposed in connection
with any such exchange shall be borne by the Certificate Administrator. Upon
surrender for cancellation of any one or more temporary Certificates, the
Trustee on behalf of the Trust shall execute and the Trustee or any
Authenticating Agent shall authenticate and deliver in exchange therefor a like
principal amount of definitive Certificates of Authorized Denominations. Until
so exchanged, the temporary Certificates shall in all respects be entitled to
the same benefits under this Agreement as definitive Certificates.
Section 5.07. Book-Entry for Book-Entry Certificates. Notwithstanding the
foregoing, the Book-Entry Certificates, upon original issuance, shall be issued
in the form of one or more typewritten Certificates of Authorized Denomination
representing the Book-Entry Certificates, to be delivered to DTC, the initial
Clearing Agency, by, or on behalf of, the Company. The Book-Entry Certificates
shall initially be registered on the Certificate Register in the name of Cede &
Co., the nominee of DTC, as the initial Clearing Agency, and no Beneficial
Holder shall receive a definitive certificate representing such Beneficial
Holder's interest in any Class of Book-Entry Certificate, except as provided
above and in Section 5.09. Each Book-Entry Certificate shall bear the following
legend:
Unless this Certificate is presented by an authorized representative of The
Depository Trust Company, a New York corporation ("DTC"), to the Company or its
agent for registration of transfer, exchange, or payment, and any Certificate
issued is registered in the name of Cede & Co. or such other name as 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.
Unless and until definitive, fully registered Book-Entry Certificates (the
"Definitive Certificates") have been issued to the Beneficial Holders pursuant
to Section 5.09:
(a) the provisions of this Section 5.07 shall be in full force and effect with
respect to the Book-Entry Certificates;
(b) the Certificate Administrator and the Trustee may deal with the Clearing
Agency for all purposes with respect to the Book-Entry Certificates (including
the making of distributions on the Book-Entry Certificates) as the sole
Certificateholder;
(c) to the extent that the provisions of this Section 5.07 conflict with any
other provisions of this Agreement, the provisions of this Section 5.07 shall
control; and
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(d) the rights of the Beneficial Holders shall be exercised only through the
Clearing Agency and the DTC Participants and shall be limited to those
established by law and agreements between such Beneficial Holders and the
Clearing Agency and/or the DTC Participants. Pursuant to the Depositary
Agreement, unless and until Definitive Certificates are issued pursuant to
Section 5.09, the initial Clearing Agency will make book-entry transfers among
the DTC Participants and receive and transmit distributions of principal and
interest on the related Class of Book-Entry Certificates to such DTC
Participants.
For purposes of any provision of this Agreement requiring or permitting actions
with the consent of, or at the direction of, Holders of Book-Entry Certificates
evidencing a specified Percentage Interest, such direction or consent may be
given by the Clearing Agency at the direction of Beneficial Holders owning
Book-Entry Certificates evidencing the requisite Percentage Interest represented
by the Book-Entry Certificates. The Clearing Agency may take conflicting actions
with respect to the Book-Entry Certificates to the extent that such actions are
taken on behalf of the Beneficial Holders.
Section 5.08. Notices to Clearing Agency. Whenever notice or other communication
to the Certificateholders is required under this Agreement, unless and until
Definitive Certificates shall have been issued to the related Certificateholders
pursuant to Section 5.09, the Trustee shall give all such notices and
communications specified herein to be given to Holders of the Book-Entry
Certificates to the Clearing Agency which shall give such notices and
communications to the related DTC Participants in accordance with its applicable
rules, regulations and procedures.
Section 5.09. Definitive Certificates. If (a) the Clearing Agency or the
Certificate Administrator notifies the Trustee in writing that the Clearing
Agency is no longer willing or able to discharge properly its responsibilities
under the Depositary Agreement with respect to the Book-Entry Certificates and
the Trustee or the Certificate Administrator is unable to locate a qualified
successor, (b) the Certificate Administrator, with the consent of the related
DTC Participants, advises the Trustee in writing that it elects to terminate the
book-entry system with respect to the Book-Entry Certificates through the
Clearing Agency or (c) after the occurrence of an Event of Default,
Certificateholders holding Book-Entry Certificates evidencing Percentage
Interests aggregating not less than 66% of the aggregate Class Principal Balance
of such Certificates advise the Trustee and the Clearing Agency through DTC
Participants in writing that the continuation of a book-entry system with
respect to the Book-Entry Certificates through the Clearing Agency is no longer
in the best interests of the Certificateholders with respect to such
Certificates, the Trustee shall notify all Certificateholders of Book-Entry
Certificates of the occurrence of any such event and of the availability of
Definitive Certificates. Upon surrender to the Trustee of the Book-Entry
Certificates by the Clearing Agency, accompanied by registration instructions
from the Clearing Agency for registration, the Trustee on behalf of the Trust
shall execute and the Trustee or any Authenticating Agent shall authenticate and
deliver the Definitive Certificates. Neither the Company, the Certificate
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Administrator, the Trust 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 for all of the Certificates all references herein to obligations
imposed upon or to be performed by the Clearing Agency shall be deemed to be
imposed upon and performed by the Trustee, to the extent applicable with respect
to such Definitive Certificates, and the Trustee shall recognize the Holders of
Definitive Certificates as Certificateholders hereunder.
Section 5.10. Office for Transfer of Certificates. The Trustee shall maintain in
New York, New York, an office or agency where Certificates may be surrendered
for registration of transfer or exchange. The Corporate Trust Office is
initially designated for said purposes.
Section 5.11. Nature of Certificates. The Certificates shall be personal
property giving only the rights specifically set forth therein and in this
Agreement. The Certificates shall have no preemptive or similar rights and when
issued and delivered to the Holders against payment of the purchase price
therefor will be fully paid and nonassessable by the Trust. The Holders of the
Certificates, in their capacities as such, shall be entitled to the same
limitation of personal liability extended to stockholders of private
corporations for profit organized under the General Corporation Law of the State
of Delaware. THE RECEIPT AND ACCEPTANCE OF A CERTIFICATE OR ANY INTEREST THEREIN
BY OR ON BEHALF OF A HOLDER OR ANY BENEFICIAL OWNER, WITHOUT ANY SIGNATURE OR
FURTHER MANIFESTATION OF ASSENT, SHALL CONSTITUTE THE UNCONDITIONAL ACCEPTANCE
BY THE HOLDER AND ALL OTHERS HAVING A BENEFICIAL INTEREST IN SUCH CERTIFICATE OF
ALL THE TERMS AND PROVISIONS OF THIS AGREEMENT, AND SHALL CONSTITUTE THE
AGREEMENT OF THE TRUST, SUCH HOLDER AND SUCH OTHERS THAT THE TERMS AND
PROVISIONS OF THIS AGREEMENT SHALL BE BINDING, OPERATIVE AND EFFECTIVE AS
BETWEEN THE TRUST AND SUCH HOLDER AND SUCH OTHERS.
ARTICLE VI
The Company and the Certificate Administrator
Section 6.01. Liability of the Company and the Certificate Administrator. The
Company and the Certificate Administrator shall be liable in accordance herewith
only to the extent of the obligations specifically imposed upon and undertaken
by the Company or the Certificate Administrator, as applicable, herein.
Section 6.02. Merger or Consolidation of the Company, or the Certificate
Administrator. Any Corporation into which the Company or the Certificate
Administrator may be merged or consolidated, or any Corporation resulting from
any merger, conversion or consolidation to which the Company or the Certificate
Administrator shall be a party, or any Corporation succeeding to the business of
the Company or the Certificate Administrator, shall be the successor of the
Company or the Certificate Administrator hereunder, without the execution or
filing of any paper or any further act on the part of any of the parties hereto,
anything herein to the contrary notwithstanding.
Section 6.03. Limitation on Liability of the Company, the Certificate
Administrator and Others. Neither the Company nor the Certificate Administrator
nor any of the directors, officers, employees or agents of the Company or the
Certificate Administrator shall be under any liability to the Trust, the Holders
of the REMIC I Regular Interests or the Certificateholders for any action taken
by such Person or for such Person's 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 Company, the Certificate
Administrator or any such Person against any liability which would otherwise be
35
imposed by reason of willful misfeasance, bad faith or gross negligence in the
performance of duties or by reason of reckless disregard of duties and
obligations hereunder. The Company, the Certificate Administrator and any
director, officer, employee or agent of the Company or the Certificate
Administrator may rely in good faith on any document of any kind properly
executed and submitted by any Person respecting any matters arising hereunder.
The Company, the Certificate Administrator and any director, officer, employee
or agent of the Company or the Certificate Administrator 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 relating to any Underlying Certificate
(other than as otherwise permitted in this Agreement) or incurred by reason of
willful misfeasance, bad faith or gross negligence in the performance of duties
hereunder or by reason of reckless disregard of obligations and duties
hereunder. The Company and the Certificate Administrator shall not be under any
obligation to appear in, prosecute or defend any legal action which in its
opinion may involve it in any expense or liability; provided, however, that the
Company or the Certificate Administrator may in its discretion undertake any
such action which it may deem necessary or desirable with respect to the
Underlying Certificates, this Agreement, the Certificates or the rights and
duties of the parties hereto and the interests of the Certificateholders
hereunder. In such event, the legal expenses and costs of such action and any
liability resulting therefrom shall be expenses, costs and liabilities of the
Trust and the Company and the Certificate Administrator shall be entitled to be
reimbursed therefor out of the Certificate Account, as provided by Section 3.05.
Section 6.04. The Company and the Certificate Administrator not to Resign. The
Company shall not resign from the obligations and duties (including, without
limitation, its obligations and duties as initial Certificate Administrator)
hereby imposed on it except upon determination that its duties hereunder are no
longer permissible under applicable law. Any successor Certificate Administrator
shall not resign from the obligations and duties hereby imposed on it except
upon determination that its duties hereunder are no longer permissible under
applicable law. Any such determination permitting the resignation of the Company
or any successor Certificate Administrator shall be evidenced by an Opinion of
Counsel to such effect delivered to the Trustee. No such resignation shall
become effective until the Trustee or a successor Certificate Administrator
shall have assumed the Certificate Administrator's responsibilities and
obligations in accordance with Section 7.02 hereof.
If the Company is no longer acting as Certificate Administrator, then the
successor Certificate Administrator shall give prompt written notice to the
Company of any information received by such successor Certificate Administrator
which affects or relates to an ongoing obligation or right of the Company under
this Agreement.
Section 6.05. Trustee Access. The Certificate Administrator shall afford the
Company and the Trustee, upon reasonable notice, during normal business hours
access to all records maintained by the Certificate Administrator, in respect of
the Mortgage Loans and in respect of its rights and obligations hereunder and
access to such of its officers as are responsible for such obligations. Upon
reasonable request, the Certificate Administrator, shall furnish the Company and
the Trustee with its most recent financial statements (or, for so long as the
Company is the Certificate Administrator, the most recent consolidated financial
statements for the Company appearing in the audited financial statements of
Washington Mutual, Inc., or the entity with whose financial statements the
36
financial statements of the Company are consolidated) and such other information
as it possesses, and which it is not prohibited by law or, to the extent
applicable, binding obligations to third parties with respect to confidentiality
from disclosing, regarding its business, affairs, property and condition,
financial or otherwise.
ARTICLE VII
Default
Section 7.01. Events of Default. (a) In case one or more of the following Events
of Default by the Certificate Administrator or by a successor Certificate
Administrator shall occur and be continuing, that is to say:
(i) Any failure by the Certificate Administrator to deposit into the Certificate
Account any payment required to be deposited therein by the Certificate
Administrator under the terms of this Agreement which continues unremedied for a
period of five Business Days after the date upon which written notice of such
failure, requiring the same to be remedied, shall have been given to the
Certificate Administrator by the Trustee or to the Certificate Administrator and
the Trustee by the Holders of Certificates evidencing Percentage Interests
aggregating not less than 25% of REMIC I; or
(ii) Failure on the part of the Certificate Administrator duly to observe or
perform in any material respect any other of the covenants or agreements on the
part of the Certificate Administrator contained in the Certificates or in this
Agreement which continues unremedied for a period of 60 days after the date on
which written notice of such failure, requiring the same to be remedied, shall
have been given to the Certificate Administrator by the Trustee, or to the
Certificate Administrator and the Trustee by the Holders of Certificates
evidencing Percentage Interests aggregating not less than 25% of REMIC I; or
(iii) A decree or order of a court or agency or supervisory authority having
jurisdiction in the premises for the appointment of a trustee in bankruptcy,
conservator or receiver or liquidator in any bankruptcy, 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 Certificate Administrator and such decree or order
shall have remained in force undischarged or unstayed for a period of 60 days;
or
(iv) The Certificate Administrator shall consent to the appointment of a trustee
in bankruptcy, conservator or receiver or liquidator in any bankruptcy,
insolvency, readjustment of debt, marshalling of assets and liabilities or
similar proceedings of or relating to the Certificate Administrator or of or
relating to all or substantially all of its property; or
37
(v) The Certificate Administrator shall admit in writing its inability to pay
its debts generally as they become due, file a petition to take advantage of any
applicable bankruptcy, insolvency or reorganization statute, make an assignment
for the benefit of its creditors, or voluntarily suspend payment of its
obligations;
then, and in each and every such case, so long as an Event of Default shall not
have been remedied, either the Trustee or the Holders of Certificates evidencing
Percentage Interests aggregating not less than 25% of REMIC I, by notice in
writing to the Company and the Certificate Administrator (and to the Trustee if
given by the Certificateholders, in which case such notice shall set forth
evidence reasonably satisfactory to the Trustee that such Event of Default has
occurred and shall not have been remedied) may terminate all of the rights
(other than its right to reimbursement for advances) and obligations of the
Certificate Administrator, including its right to the Certificate Administrator
Fee, under this Agreement and in and to the Underlying Certificates and the
proceeds thereof, if any. Such determination shall be final and binding. On or
after the receipt by the Certificate Administrator of such written notice, all
authority and power of the Certificate Administrator under this Agreement,
whether with respect to the Certificates or the Underlying Certificates or
otherwise, shall pass to and be vested in the Trustee pursuant to and under this
Section 7.01; and, without limitation, the Trustee is hereby authorized and
empowered to execute and deliver, on behalf of the Certificate Administrator, as
attorney-in-fact or otherwise, any and all documents and other instruments, and
to do or accomplish all other acts or things necessary or appropriate to effect
the purposes of such notice of termination. The Certificate Administrator agrees
to cooperate with the Trustee in effecting the termination of the Certificate
Administrator's responsibilities and rights hereunder, including, without
limitation, the transfer to the Trustee for administration by it of all cash
amounts which shall at the time be credited by the Certificate Administrator to
the Certificate Account or thereafter be received with respect to the Underlying
Certificates.
(b) In case one or more of the following Events of Default by the Company shall
occur and be continuing, that is to say:
(i) Failure on the part of the Company duly to observe or perform in any
material respect any of the covenants or agreements on the part of the Company
contained in the Certificates or in this Agreement which continues unremedied
for a period of 60 days after the date on which written notice of such failure,
requiring the same to be remedied, shall have been given to the Company by the
Trustee, or to the Company and the Trustee by the Holders of Certificates
evidencing Percentage Interests aggregating not less than 25% of REMIC I; or
(ii) A decree or order of a court or agency or supervisory authority having
jurisdiction in the premises for the appointment of a trustee in bankruptcy,
conservator or receiver or liquidator in any bankruptcy, 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 Company and such decree or order shall have remained in
force undischarged or unstayed for a period of 60 days; or
(iii) The Company shall consent to the appointment of a trustee in bankruptcy,
conservator or receiver or liquidator in any bankruptcy, insolvency,
readjustment of debt, marshalling of assets and liabilities or similar
proceedings of or relating to the Company or of or relating to all or
substantially all of its property; or
38
(iv) The Company shall admit in writing its inability to pay its debts generally
as they become due, file a petition to take advantage of any applicable
bankruptcy, insolvency or reorganization statute, make an assignment for the
benefit of creditors, or voluntarily suspend payment of its obligations;
then, and in each and every such case, so long as such Event of Default shall
not have been remedied, the Holders of Certificates evidencing Percentage
Interests aggregating not less than 25% of REMIC I, by notice in writing to the
Company and the Trustee, may direct the Trustee in accordance with Section 10.03
to institute an action, suit or proceeding in its own name as Trustee hereunder
to enforce the Company's obligations hereunder.
(c) In any circumstances in which this Agreement states that Certificateholders
owning Certificates evidencing a certain percentage Percentage Interest in REMIC
I may take certain action, such action shall be taken by the Trustee, but only
if the requisite percentage of Certificateholders required under this Agreement
for taking like action or giving like instruction to the Trustee under this
Agreement shall have so directed the Trustee in writing.
Section 7.02. Trustee to Act; Appointment of Successor. On and after the date on
which the Certificate Administrator receives a notice of termination pursuant to
Section 7.01 or the Certificate Administrator resigns pursuant to Section 6.04,
the Trustee shall be the successor in all respects to the Certificate
Administrator under this Agreement and with respect to the transactions set
forth or provided for herein and shall have all the rights and powers and be
subject to all the responsibilities, duties and liabilities relating thereto
arising on or after such date of termination or resignation placed on the
Certificate Administrator by the terms and provisions hereof and thereof, and
shall have the same limitations on liability herein granted to the Certificate
Administrator; provided, that the Trustee shall not under any circumstances be
responsible for any representations and warranties of the Company or any
liability incurred by the Certificate Administrator prior to such date of
termination or resignation. As compensation therefor, the Trustee shall be
entitled to all funds relating to the Underlying Certificates which the
Certificate Administrator would have been entitled to retain or to withdraw from
the Certificate Account if the Certificate Administrator had continued to act
hereunder, except for those amounts due to the Certificate Administrator as
reimbursement for amounts previously expended and are otherwise reimbursable
hereunder. Notwithstanding the above, the Trustee may, if it shall be unwilling
to so act, or shall if it is unable to so act, appoint, or petition a court of
competent jurisdiction to appoint, any established housing and home finance
institution having a net worth of not less than $10,000,000 as the successor to
the Certificate Administrator hereunder in the assumption of all or any part of
the responsibilities, duties or liabilities of the Certificate Administrator
hereunder. Pending any such appointment, the Trustee is obligated to act in such
capacity. In connection with such appointment and assumption, the Trustee may
make such arrangements for the compensation of such successor out of payments on
Underlying Certificates as it and such successor shall agree; provided, however,
that no such compensation shall, together with the compensation to the Trustee,
be in excess of that permitted the Certificate Administrator hereunder. The
Trustee and such successor shall take such actions, consistent with this
Agreement, as shall be necessary to effectuate any such succession.
39
Section 7.03. Notification to Certificateholders. Upon any such termination or
appointment of a successor to the Certificate Administrator, the Trustee shall
give prompt written notice thereof to the Certificateholders at their respective
addresses appearing in the Certificate Register.
ARTICLE VIII
Concerning the Trustees
Section 8.01. Duties of Trustees.
(a) The Trustee, prior to the occurrence of an Event of Default and after the
curing of all Events of Default which may have occurred, undertakes to perform
such duties and only such duties as are specifically set forth in this
Agreement. In case an Event of Default has occurred (which has not been cured or
waived) the Trustee shall exercise such of the rights and powers vested in it by
this Agreement, and use the same degree of care and skill in its exercise as a
prudent person would exercise or use under the circumstances in the conduct of
such person's own affairs.
(b) The Trustee, upon receipt of all resolutions, certificates, statements,
opinions, reports, documents, orders or other instruments furnished to it which
are specifically required to be furnished to it pursuant to any provision of
this Agreement, shall examine them to determine whether they are in the form
required by this Agreement; provided, however, that the Trustee shall not be
responsible for the accuracy or content of any such certificate, statement,
opinion, report, or other order or instrument furnished by the Company or
Certificate Administrator to the Trustee pursuant to this Agreement.
(c) No provision of this Agreement shall be construed to relieve the Trustee or
the Delaware Trustee from liability for its own negligent action, its own
negligent failure to act or its own willful misconduct; provided, however, that:
(i) Prior to the occurrence of an Event of Default and after the curing of all
such Events of Default which may have occurred, the duties and obligations of
the Trustee shall be determined solely by the express provisions of this
Agreement;
(ii) Neither the Trustee nor the Delaware Trustee shall be liable except for the
performance of such duties and obligations as are specifically set forth in this
Agreement, no implied covenants or obligations shall be read into this Agreement
against the Trustee or the Delaware Trustee, and, in the absence of bad faith on
the part of the Trustee or the Delaware Trustee, such 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 such trustee
and conforming to the requirements of this Agreement; and
(iii) Neither the Trustee nor the Delaware Trustee shall be personally liable
with respect to any action taken or omitted to be taken by it in good faith in
accordance with the direction of the Certificateholders holding Certificates
which evidence Percentage Interests aggregating not less than 25% of REMIC I
(or, in the case of the action described in Section 8.01(f), which evidence
Percentage Interests aggregating more than 50% of REMIC I) relating to the time,
method and place of conducting any proceeding for any remedy available to such
trustee, or relating to the exercise of any trust or power conferred upon such
trustee under this Agreement.
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(d) Within ten Business Days after the occurrence of any Event of Default known
to the Trustee, the Trustee shall transmit by mail to the Rating Agencies notice
of each Event of Default. Within 90 days after the occurrence of any Event of
Default known to the Trustee, the Trustee shall transmit by mail to all
Certificateholders (with a copy to the Rating Agencies) notice of each Event of
Default, unless such Event of Default shall have been cured or waived; provided,
however, the Trustee shall be protected in withholding such notice if and so
long as a Responsible Officer of the Trustee in good faith determines that the
withholding of such notice is in the best interests of the Certificateholders;
and provided, further, that in the case of any Event of Default of the character
specified in Section 7.01(i) and Section 7.01(ii) no such notice to
Certificateholders or to the Rating Agencies shall be given until at least 30
days after the occurrence thereof.
(e) The Trustee or the Delaware Trustee, as applicable, shall take or refrain
from taking such action with respect to any proposed amendment to the Pooling
and Servicing Agreement as the Certificateholders holding Certificates which
evidence Percentage Interests aggregating more than 50% of REMIC I shall so
direct in writing; provided, however, that no such act or failure to act shall:
(i) reduce in any manner the amount of, or delay the timing of, payments
received on any Certificate without the consent of the affected
Certificateholder or (ii) amend this Section 8.01(f), without the consent of all
of the Certificateholders then outstanding.
Section 8.02. Certain Matters Affecting the Trustees. Except as otherwise
provided in Section 8.01:
(i) Each of the Trustee and the Delaware 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,
approval, bond or other paper or document believed by it to be genuine and to
have been signed or presented by the proper party or parties;
(ii) Each of the Trustee and the Delaware Trustee may consult with counsel and
any Opinion of Counsel shall be full and complete authorization and protection
in respect of any action taken or suffered or omitted by it hereunder in good
faith and in accordance with such Opinion of Counsel;
(iii) Neither the Trustee nor the Delaware Trustee shall be personally liable
for any action taken or omitted by it in good faith and reasonably believed by
it to be authorized or within the discretion or rights or powers conferred upon
it by this Agreement;
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(iv) Prior to the occurrence of an Event of Default hereunder and after the
curing of all Events of Default which may have occurred, neither the Trustee nor
the Delaware Trustee shall be bound to make any investigation into the facts or
matters stated in any resolution, certificate, statement, instrument, opinion,
report, notice, request, consent, order, approval, bond or other paper or
document, unless requested in writing to do so by the Holders of Certificates
evidencing Percentage Interests aggregating not less than 25% of REMIC I;
provided, however, that if the payment within a reasonable time to the Trustee
or the Delaware Trustee of the costs, expenses or liabilities likely to be
incurred by it in the making of such investigation is, in the opinion of such
trustee, not reasonably assured to such trustee by the security, if any,
afforded to it by the terms of this Agreement, such trustee may require
reasonable indemnity against such expense or liability as a condition to
proceeding;
(v) Each of the Trustee and the Delaware Trustee may execute the trust or any of
the powers hereunder or perform any duties hereunder either directly or by or
through agents or attorneys selected by it with reasonable care or designated by
the Company;
(vi) Neither the Trustee nor the Delaware Trustee shall be deemed to have
knowledge or notice of any matter, including without limitation an Event of
Default, unless actually known by a Responsible Officer, or unless written
notice thereof referencing this Agreement or the Certificates is received at the
Notice Address of such trustee;
(vii) In no event shall the Trustee or the Delaware Trustee be held liable for
acts or omissions of the Certificate Administrator or the other trustee
(excepting the Trustee's own actions as Certificate Administrator). No provision
of this Agreement shall require the Trustee or the Delaware Trustee to expend or
risk its own funds or otherwise incur any financial liability in the performance
of any of its duties hereunder (except for the giving of required notices), or
in the exercise of any of its rights or powers, if it shall have reasonable
grounds for believing the repayment of such funds or adequate indemnity against
such risk or liability is not reasonably assured to it;
(viii) When the Trustee is acting as Certificate Administrator pursuant to
Section 7.02, and to the extent permitted under applicable law, the Trustee is
hereby authorized, in making or disposing of any investment permitted hereunder,
to deal with itself (in its individual capacity) or with any one or more of its
affiliates, whether it or its affiliate is acting as an agent of the Trustee or
of any third person or dealing as principal for its own account; and
(ix) Except as expressly provided in this Agreement, in no event shall the
Trustee be under any duty or obligation to monitor, determine, investigate or
compel compliance by the Trust with the requirements of the Statutory Trust
Statute.
Section 8.03. Trustees Not Liable for Certificates or Underlying Certificates.
The recitals contained herein (other than those relating to the due
organization, power and authority of the Trustee and the Delaware Trustee) and
in the Certificates (other than the execution of, and certificate of
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authentication on, the Certificates) shall be taken as the statements of the
Company or the Trust, as applicable, and neither the Trustee nor the Delaware
Trustee assumes any responsibility for their correctness. Neither the Trustee
nor the Delaware Trustee makes any representations as to the validity or
sufficiency of this Agreement or of the Certificates or any Underlying
Certificate. Neither the Trustee nor the Delaware Trustee shall be accountable
for the use or application by the Company or the Trust, as applicable, of any of
the Certificates or of the proceeds of such Certificates, or for the use or
application of any funds paid to the Certificate Administrator or the Company in
respect of the Underlying Certificates or deposited into the Certificate Account
by the Certificate Administrator or the Company, nor shall the Trustee be
responsible or liable for any delays in receiving amounts due on the Underlying
Certificates.
Section 8.04. Trustees May Own Certificates. The Trustee, the Delaware Trustee
or any agent or affiliate of such trustee, in its individual or any other
capacity, may become the owner or pledgee of Certificates with the same rights
it would have if it were not trustee.
Section 8.05. The Certificate Administrator to Pay Trustees' Fees and Expenses.
Subject to separate written agreements with the Trustee and the Delaware
Trustee, the Certificate Administrator covenants and agrees to, and the
Certificate Administrator shall, pay each of the Trustee and the Delaware
Trustee from time to time, and such trustee shall be entitled to payment, for
all services rendered by it in the execution of the trust hereby created and in
the exercise and performance of any of the powers and duties hereunder of such
trustee. Except as otherwise expressly provided herein, the Certificate
Administrator shall pay or reimburse each of the Trustee and the Delaware
Trustee upon such trustee's request for all reasonable expenses and
disbursements incurred or made by such trustee in accordance with any of the
provisions of this Agreement and indemnify such trustee from any loss, liability
or expense incurred by it hereunder (including the reasonable compensation and
the expenses and disbursements of its counsel and of all persons not regularly
in its employ and any expenses which arise out of or are imposed upon the
Trustee or the Delaware Trustee in connection with the creation, operation or
termination of the Trust) except any such expense or disbursement as may arise
from its own negligence or bad faith. Such obligation shall survive the
termination of this Agreement or resignation or removal of the Trustee or the
Delaware Trustee. The Tax Matters Person shall, at its expense, prepare or cause
to be prepared all federal and state income tax and franchise tax and
information returns relating to REMIC I required to be prepared or filed by the
Trustee or the Delaware Trustee and shall indemnify the Trustee and the Delaware
Trustee for any liability of such trustees arising from any error in such
returns.
Section 8.06. Eligibility Requirements for Trustees. The Trustee hereunder shall
at all times be (i) an institution insured by the FDIC, (ii) a Corporation
organized and doing business under the laws of the United States of America or
of any state, authorized under such laws to exercise corporate trust powers,
having a combined capital and surplus of not less than $50,000,000 and subject
to supervision or examination by federal or state authority and (iii) acceptable
to the Rating Agencies. If such Corporation publishes reports of condition at
least annually, pursuant to law or to the requirements of any aforementioned
supervising or examining authority, then for the purposes of this Section 8.06,
43
the combined capital and surplus of such Corporation shall be deemed to be its
combined capital and surplus as set forth in its most recent report of condition
so published. The Delaware Trustee hereunder shall at all times have its
principal place of business in the State of Delaware and shall satisfy the
applicable requirements under the laws of the State of Delaware authorizing it
to act as the Delaware trustee of the Trust. In case at any time the Trustee or
the Delaware Trustee shall cease to be eligible in accordance with the
provisions of this Section 8.06, such trustee shall resign immediately in the
manner and with the effect specified in Section 8.07.
Section 8.07. Resignation and Removal of Trustees. Each of the Trustee and the
Delaware Trustee may at any time resign and be discharged from the trust hereby
created by giving written notice thereof to the Certificate Administrator. Upon
receiving such notice of resignation, the Certificate Administrator shall
promptly appoint a successor trustee 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 shall have accepted appointment within 30 days after the giving of
such notice of resignation, the resigning trustee may petition any court of
competent jurisdiction for the appointment of a successor trustee.
If at any time the Trustee or the Delaware 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 Certificate Administrator, or if at any time the
Trustee or the Delaware Trustee shall become incapable of acting, or shall be
adjudged bankrupt or insolvent, or a receiver of such trustee or of its property
shall be appointed, or any public officer shall take charge or control of such
trustee or of its property or affairs for the purpose of rehabilitation,
conservation or liquidation, then the Certificate Administrator may remove such
trustee and appoint a successor trustee by written instrument, in duplicate,
copies of which instrument shall be delivered to the trustee so removed, the
trustee continuing in its capacity and the successor trustee.
The Holders of Certificates evidencing Percentage Interests aggregating more
than 50% of REMIC I may at any time remove the Trustee or the Delaware Trustee
and appoint a successor trustee by written instrument or instruments, in
triplicate, signed by such Holders or their attorneys in-fact duly authorized,
one complete set of which instruments shall be delivered to the Certificate
Administrator, one complete set to the Trustee so removed and one complete set
to the successor so appointed.
Any resignation or removal of the Trustee or the Delaware Trustee and
appointment of a successor trustee pursuant to any of the provisions of this
Section 8.07 shall become effective upon acceptance of appointment by the
successor trustee as provided in Section 8.08. Any expenses associated with the
resignation of the Trustee or the Delaware Trustee shall be borne by such
trustee, and any expenses associated with the removal of the Trustee or the
Delaware Trustee shall be borne by the Certificate Administrator.
Section 8.08. Successor Trustee. Any successor trustee appointed as provided in
Section 8.07 shall execute, acknowledge and deliver to the Certificate
Administrator 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 or Delaware Trustee herein. The
44
predecessor shall deliver to the successor trustee all property held by it
hereunder, and the Certificate Administrator and the predecessor trustee shall
execute and deliver such instruments and do such other things as may reasonably
be required for more fully and certainly vesting and confirming in the successor
trustee all such rights, powers, duties and obligations.
No successor trustee shall accept appointment as provided in this Section 8.08
unless at the time of such appointment such successor trustee shall be eligible
under the provisions of Section 8.06.
Upon acceptance of appointment by a successor trustee as provided in this
Section 8.08, the Certificate Administrator shall mail notice of the succession
of such trustee hereunder to (i) all Certificateholders at their addresses as
shown in the Certificate Register and (ii) the Rating Agencies. If the
Certificate Administrator fails to mail such notice within ten days after
acceptance of appointment by the successor trustee, the successor trustee shall
cause such notice to be mailed.
Section 8.09. Merger or Consolidation of Trustee. Any Corporation into which the
Trustee or the Delaware Trustee may be merged or converted or with which it may
be consolidated, or any Corporation resulting from any merger, conversion or
consolidation to which the Trustee or the Delaware Trustee shall be a party, or
any Corporation succeeding to the corporate trust business of such trustee,
shall be the successor of such trustee hereunder, provided such resulting or
successor Corporation shall be eligible under the provisions of Section 8.06,
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 hereof, at any time, for the purpose of meeting any legal
requirements of any jurisdiction in which any part of the assets of the Trust
may at the time be located, the Certificate Administrator and the Trustee or the
Delaware Trustee, as applicable, acting jointly shall have the power and shall
execute and deliver all instruments to appoint one or more Persons approved by
such trustee to act as co-trustee or co-trustees, jointly with such trustee, or
separate trustee or separate trustees, of all or any part of the assets of the
Trust and to vest in such Person or Persons, in such capacity, such title to the
assets of 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
Certificate Administrator and the Trustee or the Delaware Trustee, as
applicable, may consider necessary or desirable; provided, that the Trustee or
the Delaware Trustee, as applicable, shall remain liable for all of its
obligations and duties under this Agreement. If the Certificate Administrator
shall not have joined in such appointment within 15 days after the receipt by it
of a request so to do, or in case an Event of Default shall have occurred and be
continuing, the Trustee or the Delaware Trustee, as applicable, alone shall have
the power to make such appointment; provided, that such trustee shall remain
liable for all of its obligations and duties under this Agreement. No co-trustee
or separate trustee hereunder shall be required to meet the terms of eligibility
as a successor trustee under Section 8.06 hereunder and no notice to
Certificateholders of the appointment of co-trustee(s) or separate trustee(s)
shall be required under Section 8.08 hereof.
In the case of any appointment of a co-trustee or separate trustee pursuant to
this Section 8.10, all rights, powers, duties and obligations conferred or
45
imposed upon the Trustee or the Delaware Trustee, as applicable, shall be
conferred or imposed upon and exercised or performed by the Trustee or the
Delaware Trustee, as applicable, and such separate trustee or co-trustee jointly
and severally, except to the extent that under any law of any jurisdiction in
which any particular act or acts are to be performed by the Trustee or the
Delaware Trustee, as applicable (whether as Trustee or Delaware Trustee
hereunder or as successor to the Certificate Administrator hereunder), such
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 assets of the Trust or any portion thereof in any such
jurisdiction) shall be exercised and performed by such separate trustee or
co-trustee at the direction of the Trustee or the Delaware Trustee, as
applicable.
Any notice, request or other writing given to the Trustee or the Delaware
Trustee shall be deemed to have been given to each of the then related separate
trustee(s) and co-trustee(s), as effectively as if given to each of them. Every
instrument appointing any separate trustee(s) or co-trustee(s) 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 the Delaware Trustee, as applicable, 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 or the
Delaware Trustee, as applicable. Every such instrument shall be filed with the
Trustee or the Delaware Trustee, as applicable.
Any separate trustee or co-trustee may, at any time, constitute the Trustee or
the Delaware Trustee, as applicable, its agent or attorney-in-fact, with full
power and authority, to the extent not prohibited by law, to do any lawful act
under or in respect of this Agreement on its behalf and in its name. If any
separate trustee or co-trustee shall die, become incapable of acting, resign or
be removed, all of its estates, properties, rights, remedies and the trust shall
vest in and be exercised by the Trustee or the Delaware Trustee, as applicable,
to the extent permitted by law, without the appointment of a new or successor
trustee.
Section 8.11. Authenticating Agents. The Trustee may appoint one or more
Authenticating Agents which shall be authorized to act on behalf of the Trustee
in authenticating Certificates. Wherever reference is made in this Agreement to
the authentication of Certificates by the Trustee or the Trustee's certificate
of authentication, such reference shall be deemed to include authentication on
behalf of the Trustee by an Authenticating Agent and a certificate of
authentication executed on behalf of the Trustee by an Authenticating Agent.
Each Authenticating Agent must be acceptable to the Certificate Administrator
and must be a corporation, trust company or banking association organized and
doing business under the laws of the United States of America or of any state,
having an office and place of business in New York, New York, having a combined
capital and surplus of at least $15,000,000, authorized under such laws to do a
trust business and subject to supervision or examination by federal or state
authorities.
Any corporation into which any Authenticating Agent may be merged or converted
or with which it may be consolidated, or any corporation resulting from any
merger, conversion or consolidation to which any Authenticating Agent shall be a
46
party, or any corporation succeeding to the corporate agency business of any
Authenticating Agent, shall continue to be the Authenticating Agent so long as
it shall be eligible in accordance with the provisions of the first paragraph of
this Section 8.11 without the execution or filing of any paper or any further
act on the part of the Trustee or the Authenticating Agent.
Any Authenticating Agent may at any time resign by giving written notice of
resignation to the Trustee and the Certificate Administrator. The Trustee may,
upon prior written approval of the Certificate Administrator, at any time
terminate the agency of any Authenticating Agent by giving written notice of
termination to such Authenticating Agent and to the Certificate Administrator.
Upon receiving a notice of resignation or upon such a termination, or in case at
any time any Authenticating Agent shall cease to be eligible in accordance with
the provisions of the first paragraph of this Section 8.11, the Trustee may
appoint, upon prior written approval of the Certificate Administrator, a
successor Authenticating Agent, shall give written notice of such appointment to
the Certificate Administrator and shall mail notice of such appointment to all
Certificateholders. Any successor Authenticating Agent upon acceptance of its
appointment hereunder shall become vested with all the rights, powers, duties
and responsibilities of its predecessor hereunder, with like effect as if
originally named as Authenticating Agent. Any reasonable compensation paid to an
Authenticating Agent shall be a reimbursable expense pursuant to Section 8.05 if
paid by the Trustee.
Section 8.12. Paying Agents. The Trustee may appoint one or more Paying Agents
which shall be authorized to act on behalf of the Trustee in making withdrawals
from the Certificate Account, and distributions to Certificateholders as
provided in Section 4.01 and Section 9.01(b) to the extent directed to do so by
the Certificate Administrator. Wherever reference is made in this Agreement to
the withdrawal from the Certificate Account by the Trustee, such reference shall
be deemed to include such a withdrawal on behalf of the Trustee by a Paying
Agent. Whenever reference is made in this Agreement to a distribution by the
Trustee or the furnishing of a statement to Certificateholders by the Trustee,
such reference shall be deemed to include such a distribution or furnishing on
behalf of the Trustee by a Paying Agent. Each Paying Agent shall provide to the
Trustee such information concerning the Certificate Account as the Trustee shall
request from time to time. Each Paying Agent must be reasonably acceptable to
the Certificate Administrator and must be a corporation, trust company or
banking association organized and doing business under the laws of the United
States of America or of any state, having an office and place of business in New
York, New York, having a combined capital and surplus of at least $15,000,000,
authorized under such laws to do a trust business and subject to supervision or
examination by federal or state authorities.
Any corporation into which any Paying Agent may be merged or converted or with
which it may be consolidated, or any corporation resulting from any merger,
conversion or consolidation to which any Paying Agent shall be a party, or any
corporation succeeding to the corporate agency business of any Paying Agent,
shall continue to be the Paying Agent provided that such corporation after the
consummation of such merger, conversion, consolidation or succession meets the
eligibility requirements of this Section 8.12.
Any Paying Agent may at any time resign by giving written notice of resignation
to the Trustee and to the Certificate Administrator; provided, that the Paying
Agent has returned to the Certificate Account or otherwise accounted, to the
reasonable satisfaction of the Certificate Administrator, for all amounts it has
withdrawn from the Certificate Account. The Trustee may, upon prior written
approval of the Certificate Administrator, at any time terminate the agency of
47
any Paying Agent by giving written notice of termination to such Paying Agent
and to the Certificate Administrator. Upon receiving a notice of resignation or
upon such a termination, or in case at any time any Paying Agent shall cease to
be eligible in accordance with the provisions of the first paragraph of this
Section 8.12, the Trustee may appoint, upon prior written approval of the
Certificate Administrator, a successor Paying Agent, shall give written notice
of such appointment to the Certificate Administrator and shall mail notice of
such appointment to all Certificateholders. Any successor Paying Agent upon
acceptance of its appointment hereunder shall become vested with all the rights,
powers, duties and responsibilities of its predecessor hereunder, with like
effect as if originally named as Paying Agent. Any reasonable compensation paid
to any Paying Agent shall be a reimbursable expense pursuant to Section 8.05 if
paid by the Trustee.
Section 8.13. Duties of Delaware Trustee.
(a) The Delaware Trustee is appointed to serve as the trustee of the Trust in
the State of Delaware for the sole purpose of satisfying the requirement of
Section 3807(a) of the Statutory Trust Statute that the Trust have at least one
trustee with a principal place of business in Delaware. It is understood and
agreed by the parties hereto that the Delaware Trustee shall have none of the
duties or liabilities of the Trustee.
(b) The duties of the Delaware Trustee shall be limited to (i) accepting legal
process served on the Trust in the State of Delaware, (ii) the execution of any
certificates with respect to the Trust required to be filed with the Secretary
of State which the Delaware Trustee is required to execute under Section 3811 of
the Statutory Trust Statute and (iii) such other duties as are set forth in this
Article VIII. To the extent that, at law or in equity, the Delaware Trustee has
duties (including fiduciary duties) and liabilities relating thereto to the
Trust or the Holders of the REMIC I Regular Interests or the Certificates, it is
hereby understood and agreed by the parties hereto that such duties and
liabilities are replaced by the duties and liabilities of the Delaware Trustee
expressly set forth in this Agreement.
Section 8.14. Amendment to Certificate of Trust. If at any time required by
Section 3810 of the Statutory Trust Statute, the Trustee, the Delaware Trustee
and any other trustee of the Trust shall cause an amendment to the Certificate
of Trust to be filed with the Secretary of State in accordance with the
provisions of such Section 3810.
Section 8.15. Limitation of Liability. It is expressly understood and agreed by
the parties hereto that (a) each of the representations, undertakings and
agreements herein made on the part of the Trust is made and intended not as
personal representations, undertakings and agreements by the Trustee but is made
and intended for the purpose of binding only the Trust and (b) under no
circumstances shall the Trustee be personally liable for the payment of any
indebtedness or expenses of the Trust or be liable for the breach or failure of
any obligation, representation, warranty or covenant made or undertaken by the
Trust under this Agreement.
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ARTICLE IX
Termination
Section 9.01. Termination Upon Purchase by the Certificate Administrator of the
Underlying Certificates.
(a) Except as otherwise set forth in this Article IX, including, without
limitation, the obligation of the Certificate Administrator to make payments to
Certificateholders as hereafter set forth, the Trust and the respective
obligations and responsibilities of the Company, the Certificate Administrator,
the Trustee and the Delaware Trustee created hereby shall terminate in
accordance with Section 3808 of the Statutory Trust Statute upon (i) the
purchase by the Certificate Administrator pursuant to the following paragraph of
this Section 9.01(a) of the Underlying Certificates and all other property
included in any REMIC formed under this Agreement at a price equal to the sum of
(x) 100% of the aggregate outstanding Class Principal Balance of the Underlying
Certificates (after giving effect to the distribution of principal and
allocation of Realized Losses to the Underlying Certificates on such
Distribution Date) and (y) the appraised fair market value as of the effective
date of the termination of the Trust of all other property included in any REMIC
formed under this Agreement, any such appraisal to be conducted by an appraiser
mutually agreed upon by the Certificate Administrator and the Trustee, or (ii)
the final payment (or any advance with respect thereto) of the Underlying
Certificates, and the payment to the Certificateholders of all amounts required
to be paid to them hereunder; provided, however, that in no event shall the
Trust continue beyond the expiration of 21 years from the death of the survivor
of the issue of ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇, the late ambassador of the United States to
the Court of St. ▇▇▇▇▇, living on the date hereof.
On any Distribution Date after the first date on which the aggregate Class
Principal Balance of the Underlying Certificates is less than the Clean-Up Call
Percentage of the aggregate Class Principal Balance of the Underlying
Certificates as of the Closing Date, the Certificate Administrator may purchase
the Underlying Certificates (after giving effect to the distributions and the
allocation of Realized Losses to the Underlying Certificates on such
Distribution Date), and all other property included in any REMIC formed under
this Agreement at the price stated in clause (i) of the preceding paragraph;
provided, that the Certificate Administrator may not so purchase the Underlying
Certificates and all other property included in any REMIC formed under this
Agreement if the price stated in clause (i) of the preceding paragraph exceeds
the fair market value, determined in accordance with prudent industry practices,
of all Underlying Certificates and all other property included in any REMIC
formed under this Agreement. If such right is exercised, the Certificate
Administrator shall provide to the Trustee (and to the Company, if the Company
is no longer acting as Certificate Administrator) the written certification of
an officer of the Certificate Administrator (which certification shall include a
statement to the effect that all amounts required to be paid in order to
purchase the Underlying Certificates have been deposited in the Certificate
Account) and the Trustee on behalf of the Trust shall promptly execute all
instruments as may be necessary to release and assign to the Certificate
Administrator the Underlying Certificates to the Trust.
In no event shall the Certificate Administrator be required to expend any
amounts other than those described in the first paragraph of this Section
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9.01(a) in order to terminate the Trust or purchase the Underlying Certificates
under this Section 9.01, and in no event shall the Company be required to expend
any amounts in connection with such termination or purchase.
In the event that the Certificate Administrator elects to exercise its purchase
option as provided in this Section 9.01(a), the Certificate Administrator shall
provide to the Trustee and the Delaware Trustee (and to the Company, if the
Company is no longer acting as Certificate Administrator) notice thereof not
less than 40 days prior to the date of the final distribution to
Certificateholders.
(b) Notice of any termination, specifying the date upon which the
Certificateholders may surrender their Certificates to the Trustee for payment
and cancellation, shall be given promptly by letter from the Trustee to
Certificateholders mailed not less than 30 days prior to such final
distribution, specifying (i) the date upon which final payment of the
Certificates will be made upon presentation and surrender of Certificates at the
office of the Certificate Registrar therein designated (the "Termination Date"),
(ii) the amount of such final payment (the "Termination Payment") and (iii) that
the Record Date otherwise applicable to the Distribution Date upon which the
Termination Date occurs is not applicable, payments being made only upon
presentation and surrender of the Certificates at the office of the Certificate
Registrar therein specified. Upon any such notice, the Certificate Account shall
terminate subject to the Certificate Administrator's obligation to hold all
amounts payable to Certificateholders in trust without interest pending such
payment.
In the event that all of the Certificateholders shall not surrender their
Certificates for cancellation within six months after the Termination Date, the
Certificate Administrator shall give a second written notice to the remaining
Certificateholders to surrender their Certificates for cancellation and receive
the Termination Payment with respect thereto. If within one year after the
second notice all the Certificates shall not have been surrendered for
cancellation, the Certificate Administrator may take appropriate steps to
contact the remaining Certificateholders concerning surrender of their
Certificates, and the cost thereof shall be paid out of the funds and other
assets which remain in trust hereunder.
Upon the completion of winding up of the Trust, including the payment or the
making reasonable provision for payment of all obligations of the Trust in
accordance with Section 3808(e) of the Statutory Trust Statute, the Delaware
Trustee shall prepare, the Trustee, the Delaware Trustee and any other trustee
hereunder shall sign, and the Delaware Trustee (upon the Trustee's consent
acting at the direction of the Certificate Administrator) shall file, a
certificate of cancellation with the Secretary of State in accordance with
Section 3810 of the Statutory Trust Statute, at which time the Trust and this
Agreement shall terminate. The Certificate Administrator shall act as the
liquidator of the Trust and shall be responsible for taking all actions in
connection with winding up the Trust, in accordance with the requirements of
this Agreement (including this Section 9.01 and Section 9.02) and applicable
law.
Section 9.02. Additional Termination Requirements.
(a) In the event the Certificate Administrator exercises its purchase option as
provided in Section 9.01, REMIC I shall be terminated in accordance with the
following additional requirements, unless the Certificate Administrator, at its
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own expense, obtains for the Trustee an Opinion of Counsel to the effect that
the failure of REMIC I to comply with the requirements of this Section 9.02 will
not (i) result in the imposition of taxes on "prohibited transactions" of REMIC
I as described in Section 860F of the Code, or (ii) cause REMIC I to fail to
qualify as a REMIC at any time that any Certificates are outstanding:
(i) Within 90 days prior to the final Distribution Date set forth in the notice
given by the Trustee under Section 9.01, the Tax Matters Person shall prepare
the documentation required and the Tax Matters Person and the Trustee shall
adopt a plan of complete liquidation on behalf of REMIC I meeting the
requirements of a qualified liquidation under Section 860F of the Code and any
regulations thereunder, as evidenced by an Opinion of Counsel obtained at the
expense of the Certificate Administrator, on behalf of REMIC I; and
(ii) At or after the time of adoption of such a plan of complete liquidation and
at or prior to the final Distribution Date, the Certificate Administrator as
agent of the Trust shall sell all of the assets of REMIC I to the Certificate
Administrator for cash in the amount specified in Section 9.01.
(b) By its acceptance of any Residual Certificate, the Holder thereof hereby
agrees to authorize the Tax Matters Person and the Trustee to adopt such a plan
of complete liquidation upon the written request of the Tax Matters Person and
the Trustee and to take such other action in connection therewith as may be
reasonably requested by the Tax Matters Person or the Trustee.
Section 9.03. Trust Irrevocable. Except as expressly provided herein, the trust
created hereby is irrevocable.
ARTICLE X
Miscellaneous Provisions
Section 10.01. Amendment.
(a) This Agreement may be amended from time to time by the Certificate
Administrator, the Company and the Trustee, without the consent of any of the
Certificateholders:
(i) to cure any ambiguity;
(ii) to correct or supplement any provision herein which may be defective or
inconsistent with any other provisions herein;
(iii) to comply with any requirements imposed by the Code or any regulations
thereunder;
(iv) to correct the description of any property at any time included in REMIC I,
or to assure the conveyance to the Trust of any property included in REMIC I;
51
(v) pursuant to Section 5.01(c)(v); and
(vi) to add any provision to, or amend any provision in, this Agreement,
provided that such amendment or addition does not adversely affect in any
material respect the interests of any Certificateholder;
provided, however, that any such amendment which modifies the rights or
obligations of the Delaware Trustee hereunder shall require the consent of the
Delaware Trustee. No such amendment (other than one entered into pursuant to
clause (iii) of the preceding sentence) shall change the powers of the
Certificate Administrator. Prior to entering into any amendment (other than one
entered into pursuant to clause (iii) of the second preceding sentence) without
the consent of Certificateholders pursuant to this paragraph, the Trustee shall
require an Opinion of Counsel addressed to the Trust and the Trustee to the
effect that such amendment is permitted under this Agreement and has no material
adverse effect on the interests of the Certificateholders; provided, however,
that no such Opinion of Counsel shall be required if the Company obtains a
letter from each Rating Agency stating that the amendment would not result in
the downgrading or withdrawal of the respective ratings then assigned to the
Certificates. Prior to entering into any amendment pursuant to clause (iii) of
the third preceding sentence without the consent of Certificateholders pursuant
to this paragraph, the Trustee shall require an Opinion of Counsel to the effect
that such action is necessary or helpful to comply with the requirements imposed
by the Code or any regulations thereunder and shall not cause any REMIC formed
under this Agreement to fail to qualify as such under the Code.
(b) This Agreement may also be amended from time to time by the Certificate
Administrator, the Company and the Trustee with the consent of the Holders of
Certificates evidencing Percentage Interests aggregating not less than 66% of
REMIC I 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 Certificateholders; provided, however, that no such
amendment shall, without the consent of the Holder of each Certificate affected
thereby (i) reduce in any manner the amount of, or delay the timing of,
distributions of principal or interest required to be made hereunder or reduce
the Certificateholder's Percentage Interest, the Certificate Interest Rate or
the Termination Payment with respect to any of the Certificates, (ii) reduce the
percentage of Percentage Interests specified in this Section 10.01 which are
required to amend this Agreement, (iii) create or permit the creation of any
lien against any part of REMIC I, or (iv) modify any provision in any way which
would permit an earlier retirement of the Certificates; provided, further, that
any such amendment which modifies the rights or obligations of the Delaware
Trustee hereunder shall require the consent of the Delaware Trustee.
Promptly after the execution of any such amendment, the Trustee shall furnish
written notification of the substance of such amendment to the Delaware Trustee
and each Certificateholder. Any failure to provide such notice, or any defect
therein, shall not, however, in any way impair or affect the validity of any
such amendment.
It shall not be necessary for the consent of Certificateholders under this
Section 10.01 to approve the particular form of any proposed amendment, but it
shall be sufficient if such consent shall approve the substance thereof. The
52
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 10.02. [Reserved.]
Section 10.03. Limitation on Rights of Certificateholders. The death or
incapacity of any Certificateholder shall not operate to terminate this
Agreement or the Trust, nor entitle such Certificateholder's legal
representatives or heirs to claim an accounting or to take any action or
proceeding in any court for a partition or winding-up of the Trust, nor
otherwise affect the rights, obligations and liabilities of the parties hereto
or any of them.
No Certificateholder shall have any right to vote or in any manner otherwise to
control the operation and management of the Trust or the obligations of the
parties hereto (except as provided in Section 5.09, Section 7.01, Section 8.01,
Section 8.02, Section 8.07, Section 10.01 and this Section 10.03), 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 or by availing of any
provision of this Agreement to institute any suit, action or proceeding in
equity or at law upon or under or with respect to this Agreement, unless such
Holder previously shall have given to the Trustee a written notice of default
and of the continuance thereof, as hereinbefore provided, and unless also the
Holders of Certificates evidencing Percentage Interests aggregating not less
than 25% of REMIC I shall have made written request upon the Trustee to
institute such action, suit or proceeding in its own name as Trustee hereunder
and shall have offered to the Trustee such reasonable indemnity as it may
require against the costs, expenses and liabilities to be incurred therein or
thereby, and the Trustee, for 60 days after its receipt of such notice, request
and offer of indemnity, shall have neglected or refused to institute any such
action, suit or proceeding. However, the Trustee is under no obligation to
exercise any of the extraordinary trusts or powers vested in it by this
Agreement or to make any investigation of matters arising hereunder or to
institute, conduct or defend any litigation hereunder or in relation hereto at
the request, order or direction of any of the Certificateholders unless such
Certificateholders have offered to the Trustee reasonable security or indemnity
against the costs, expenses and liabilities which may be incurred therein or
thereby. 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 or by availing of any provision of this Agreement to affect, disturb
or prejudice the rights of the Holders of any other of such Certificates, or to
obtain or seek to obtain priority over or preference to any other such Holder,
or to enforce any right under this Agreement, except in the manner herein
provided and for the equal, ratable and common benefit of all
Certificateholders. For the protection and enforcement of the provisions of this
Section 10.03, each and every Certificateholder and the Trustee shall be
entitled to such relief as can be given either at law or in equity.
Section 10.04. Access to List of Certificateholders. The Certificate Registrar
shall furnish or cause to be furnished to the Trustee, within 30 days after
53
receipt of a request by the Trustee in writing, a list, in such form as the
Trustee may reasonably require, of the names and addresses of the
Certificateholders as of the most recent Record Date for payment of
distributions to such Certificateholders.
If three or more Certificateholders (hereinafter referred to as "applicants")
apply in writing to the Trustee, and such application states that the applicants
desire to communicate with other Certificateholders with respect to their rights
under this Agreement or under the Certificates and is accompanied by a copy of
the communication which such applicants propose to transmit, then the Trustee
shall, within five Business Days after the receipt of such list from the
Certificate Registrar, afford such applicants access during normal business
hours to the most recent list of Certificateholders held by the Trustee. If such
a list is as of a date more than 90 days prior to the date of receipt of such
applicants' request, the Trustee shall promptly request from the Certificate
Registrar a current list as provided above, and shall afford such applicants
access to such list promptly upon receipt.
Every Certificateholder, by receiving and holding the same, agrees with the
Certificate Administrator, the Trust, the Trustee and the Delaware Trustee that
none of the Certificate Administrator, the Trust, the Trustee or the Delaware
Trustee shall be held accountable by reason of the disclosure of any such
information as to the names and addresses of the Certificateholders hereunder,
regardless of the source from which such information was derived.
Section 10.05. Governing Law. This Agreement shall be construed in accordance
with the laws of the State of Delaware without giving effect to its conflict of
laws provisions and the obligations, rights and remedies of the parties
hereunder shall be determined in accordance with such laws without giving effect
to conflict of laws provisions.
Section 10.06. 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 or certified mail to the applicable Notice
Address. Notices to the Rating Agencies shall also be deemed to have been duly
given if mailed by first class mail, postage prepaid, to the above listed
addresses of the Rating Agencies. 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. Any notice so
mailed within the time prescribed in this Agreement shall be conclusively
presumed to have been duly given, whether or not the Certificateholder receives
such notice.
Section 10.07. Severability of Provisions. If any one or more of the covenants,
agreements, provisions or terms of this Agreement shall be for any reason
whatsoever held invalid, then such covenants, agreements, provisions or terms
shall be deemed severable from the remaining covenants, agreements, provisions
or terms of this Agreement and shall in no way affect the validity or
enforceability of the other provisions of this Agreement or of the Certificates
or the rights of the Holders thereof.
Section 10.08. Counterpart Signatures. For the purpose of facilitating the
recordation of this Agreement as herein provided and for other purposes, this
Agreement may be executed simultaneously in any number of counterparts, each of
which counterparts shall be deemed to be an original, and such counterparts
shall constitute but one and the same instrument.
54
Section 10.09. Benefits of Agreement. Nothing in this Agreement or in any
Certificate, expressed or implied, shall give to any Person, other than the
parties hereto and their respective successors hereunder, any separate trustee
or co-trustee appointed under Section 8.10 and the Certificateholders, any
benefit or any legal or equitable right, remedy or claim under this Agreement.
Section 10.10. Notices and Copies to Rating Agencies.
(a) The Trustee shall notify the Rating Agencies of the occurrence of any of the
following events, in the manner provided in Section 10.06:
(i) the occurrence of an Event of Default pursuant to Section 7.01, subject to
the provisions of Section 8.01(d); and (ii) the appointment of a successor
Certificate Administrator pursuant to Section 7.02;
(b) The Certificate Administrator shall notify the Rating Agencies of the
occurrence of any of the following events, or in the case of clauses (iii),
(iv), (vii) and (viii) promptly upon receiving notice thereof, in the manner
provided in Section 10.06:
(i) any amendment of this Agreement pursuant to Section 10.01;
(ii) the appointment of a successor Trustee or successor Delaware Trustee
pursuant to Section 8.08;
(iii) the filing of any claim under or the cancellation or modification of any
fidelity bond and errors and omissions coverage pursuant to Section 3.01 with
respect to the Certificate Administrator;
(iv) any change in the location of the Certificate Account;
(v) the purchase of the Underlying Certificates pursuant to Section 9.01; and
(vi) the occurrence of the final Distribution Date or the termination of the
trust pursuant to Section 9.01(a)(ii).
The Certificate Administrator shall provide copies of the statements pursuant to
Section 4.02, Section 4.04, Section 3.12, Section 3.13 or Section 3.15 or any
other statements or reports to the Rating Agencies in such time and manner that
such statements or determinations are required to be provided to
Certificateholders. With respect to the reports described in the second
paragraph of Section 4.04, the Certificate Administrator shall provide such
reports to the Rating Agencies in respect of each Distribution Date, without
regard to whether any Certificateholder or the Trustee or the Delaware Trustee
has requested such report for such Distribution Date.
55
IN WITNESS WHEREOF, the Company, the Trustee and the Delaware 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.
WASHINGTON MUTUAL MORTGAGE SECURITIES CORP.
By: /s/ ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇
Name: ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇
Title: First Vice President
CITIBANK, N.A.,
as Trustee
By: /s/ ▇▇▇▇ ▇▇▇▇▇▇
Name: ▇▇▇▇ ▇▇▇▇▇▇
Title: Associate
CHRISTIANA BANK & TRUST COMPANY,
as Delaware Trustee
By: ▇▇▇▇▇ ▇. ▇▇▇▇▇
Name: ▇▇▇▇▇ ▇. ▇▇▇▇▇
Title: Assistant Vice President
[Signature page to Amended and Restated Trust Agreement
for WaMu Series 2004-RS2]
ACKNOWLEDGEMENT OF CORPORATION
STATE OF WASHINGTON )
) SS.
COUNTY OF KING )
I certify that I know or have satisfactory evidence that ▇▇▇▇▇▇ ▇.
▇▇▇▇▇▇▇ is the person who appeared before me, and said person acknowledged that
he signed this instrument, on oath stated that he was authorized to execute the
instrument and acknowledged it as the First Vice President of WASHINGTON MUTUAL
MORTGAGE SECURITIES CORP., to be the free and voluntary act of such party for
the uses and purposes mentioned therein.
Dated this 28th day of April, 2004.
/s/ ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇
Notary Public in and for the State of
Washington, residing at Seattle
My commission expires: 2-26-2007
ACKNOWLEDGEMENT
STATE OF NEW YORK )
) SS.
COUNTY OF NEW YORK )
On this 29th day of April 2004 before me, a Notary Public in and for
said State, personally appeared ▇▇▇▇ ▇▇▇▇▇▇, personally known to me (or proved
to me on the basis of satisfactory evidence) to be the person(s) whose name(s)
is/are subscribed to the within instrument and acknowledged to me that
he/she/they executed the same in his/her/their authorized capacit(ies), and that
by his/her/their signature(s) on the instrument the person(s), or the entity
upon behalf of which the person(s) acted, executed the instrument.
WITNESS my hand and official seal.
Signature /s/ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇
(SEAL) ▇▇▇▇▇▇▇ ▇▇▇▇▇▇
Notary Public, State of New York
No. 01MU6086415
Qualified in Kings County
Commission Expires 1/21/04
ACKNOWLEDGEMENT
STATE OF DELAWARE )
) SS.
COUNTY OF NEWCASTLE )
On this 22nd day of April 2004 before me, a Notary Public in and for
said State, personally appeared ▇▇▇▇▇ ▇. ▇▇▇▇▇, personally known to me (or
proved to me on the basis of satisfactory evidence) to be the person(s) whose
name(s) is/are subscribed to the within instrument and acknowledged to me that
he/she/they executed the same in his/her/their authorized capacit(ies), and that
by his/her/their signature(s) on the instrument the person(s), or the entity
upon behalf of which the person(s) acted, executed the instrument.
WITNESS my hand and official seal.
Signature /a/ ▇▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇
(SEAL) ▇▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇
Notary Public
State of Delaware
My Commission Expires May 29, 2005
Exhibit A
CUSIP 92922F PE2
WaMu MORTGAGE PASS-THROUGH CERTIFICATE
Class A-1
Evidencing a beneficial interest in a pool of assets consisting of, among other
things, mortgage pass-through certificates formed and administered by
WASHINGTON MUTUAL MORTGAGE SECURITIES CORP.
This Certificate is issued by WaMu Mortgage Pass-Through Certificates Series
2004-RS2 Trust. This Certificate represents ownership of a "regular interest" in
a "real estate mortgage investment conduit," as those terms are defined in
Sections 860G and 860D, respectively, of the Internal Revenue Code of 1986, as
amended. The issue date of this Certificate is April 29, 2004.
Unless this Certificate is presented by an authorized representative of The
Depository Trust Company, a New York corporation ("DTC"), to the Company or its
agent for registration of transfer, exchange, or payment, and any Certificate
issued is registered in the name of Cede & Co. or such other name as 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.
Series 2004-RS2 Portion of the Class A-1 Principal Balance as of the Closing
Date Evidenced by this Certificate:
$107,251,000.00
Class A-1 Certificate Interest Rate: 5.000%
Closing Date: April 29, 2004
First Distribution Date: May 25, 2004
Last Scheduled Distribution Date: November 25, 2033
Class A-1 Principal Balance
as of the Closing Date: $107,251,000.00
Cede & Co.
Registered Owner
A-1
Exhibit A
CUSIP 92922F PF9
WaMu MORTGAGE PASS-THROUGH CERTIFICATE
Class A-2
Evidencing a beneficial interest in a pool of assets consisting of, among other
things, mortgage pass-through certificates formed and administered by
WASHINGTON MUTUAL MORTGAGE SECURITIES CORP.
This Certificate is issued by WaMu Mortgage Pass-Through Certificates Series
2004-RS2 Trust. This Certificate represents ownership of a "regular interest" in
a "real estate mortgage investment conduit," as those terms are defined in
Sections 860G and 860D, respectively, of the Internal Revenue Code of 1986, as
amended. The issue date of this Certificate is April 29, 2004.
Unless this Certificate is presented by an authorized representative of The
Depository Trust Company, a New York corporation ("DTC"), to the Company or its
agent for registration of transfer, exchange, or payment, and any Certificate
issued is registered in the name of Cede & Co. or such other name as 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.
Series 2004-RS2 Portion of the Class A-2 Principal Balance as of the Closing
Date Evidenced by this Certificate:
$5,155,000.00
Class A-2 Certificate Interest Rate: 5.000%
Closing Date: April 29, 2004
First Distribution Date: May 25, 2004
Last Scheduled Distribution Date: November 25, 2033
Class A-2 Principal Balance as of the Closing Date: $5,155,000.00
Cede & Co.
Registered Owner
A-2
Exhibit A
CUSIP 92922F PG7
WaMu MORTGAGE PASS-THROUGH CERTIFICATE
Class A-3
Evidencing a beneficial interest in a pool of assets consisting of, among other
things, mortgage pass-through certificates formed and administered by
WASHINGTON MUTUAL MORTGAGE SECURITIES CORP.
This Certificate is issued by WaMu Mortgage Pass-Through Certificates Series
2004-RS2 Trust. This Certificate represents ownership of a "regular interest" in
a "real estate mortgage investment conduit," as those terms are defined in
Sections 860G and 860D, respectively, of the Internal Revenue Code of 1986, as
amended. The issue date of this Certificate is April 29, 2004.
Unless this Certificate is presented by an authorized representative of The
Depository Trust Company, a New York corporation ("DTC"), to the Company or its
agent for registration of transfer, exchange, or payment, and any Certificate
issued is registered in the name of Cede & Co. or such other name as 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.
Series 2004-RS2 Portion of the Class A-3 Principal Balance as of the Closing
Date Evidenced by this Certificate:
$4,041,000.00
Class A-3 Certificate Interest Rate: 5.000%
Closing Date: April 29, 2004
First Distribution Date: May 25, 2004
Last Scheduled Distribution Date: November 25, 2033
Class A-3 Principal Balance
as of the Closing Date: $4,041,000.00
Cede & Co.
Registered Owner
A-3
Exhibit A
CUSIP 92922F PH5
WaMu MORTGAGE PASS-THROUGH CERTIFICATE
Class A-4
Evidencing a beneficial interest in a pool of assets consisting of, among other
things, mortgage pass-through certificates formed and administered by
WASHINGTON MUTUAL MORTGAGE SECURITIES CORP.
This Certificate is issued by WaMu Mortgage Pass-Through Certificates Series
2004-RS2 Trust. This Certificate represents ownership of a "regular interest" in
a "real estate mortgage investment conduit," as those terms are defined in
Sections 860G and 860D, respectively, of the Internal Revenue Code of 1986, as
amended. The issue date of this Certificate is April 29, 2004.
Unless this Certificate is presented by an authorized representative of The
Depository Trust Company, a New York corporation ("DTC"), to the Company or its
agent for registration of transfer, exchange, or payment, and any Certificate
issued is registered in the name of Cede & Co. or such other name as 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.
Series 2004-RS2 Portion of the Class A-4 Principal Balance as of the Closing
Date Evidenced by this Certificate:
$7,108,041.00
Class A-4 Certificate Interest Rate: 5.000%
Closing Date: April 29, 2004
First Distribution Date: May 25, 2004
Last Scheduled Distribution Date: November 25, 2033
Class A-4 Principal Balance
as of the Closing Date: $7,108,041.00
Cede & Co.
Registered Owner
A-4
Exhibit A
CUSIP 92922F PJ1
WaMu MORTGAGE PASS-THROUGH CERTIFICATE
Class A-5
Evidencing a beneficial interest in a pool of assets consisting of, among other
things, mortgage pass-through certificates formed and administered by
WASHINGTON MUTUAL MORTGAGE SECURITIES CORP.
This Certificate is issued by WaMu Mortgage Pass-Through Certificates Series
2004-RS2 Trust. This Certificate represents ownership of a "regular interest" in
a "real estate mortgage investment conduit," as those terms are defined in
Sections 860G and 860D, respectively, of the Internal Revenue Code of 1986, as
amended. The issue date of this Certificate is April 29, 2004. Interest is not
payable with respect to this Certificate.
Unless this Certificate is presented by an authorized representative of The
Depository Trust Company, a New York corporation ("DTC"), to the Company or its
agent for registration of transfer, exchange, or payment, and any Certificate
issued is registered in the name of Cede & Co. or such other name as 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.
Series 2004-RS2 Portion of the Class A-5 Principal Balance as of the Closing
Date Evidenced by this Certificate:
$1,111,445.00
Class A-5 Certificate Interest Rate: 0.000%
Closing Date: April 29, 2004
First Distribution Date: May 25, 2004
Last Scheduled Distribution Date: November 25, 2033
Class A-5 Principal Balance
as of the Closing Date: $1,111,445.00
Cede & Co.
Registered Owner
A-5
Exhibit A
CUSIP 92922F PK8
WaMu MORTGAGE PASS-THROUGH CERTIFICATE
Class A-6
Evidencing a beneficial interest in a pool of assets consisting of, among other
things, mortgage pass-through certificates formed and administered by
WASHINGTON MUTUAL MORTGAGE SECURITIES CORP.
This Certificate is issued by WaMu Mortgage Pass-Through Certificates Series
2004-RS2 Trust. This Certificate represents ownership of a "regular interest" in
a "real estate mortgage investment conduit," as those terms are defined in
Sections 860G and 860D, respectively, of the Internal Revenue Code of 1986, as
amended. The issue date of this Certificate is April 29, 2004.
Unless this Certificate is presented by an authorized representative of The
Depository Trust Company, a New York corporation ("DTC"), to the Company or its
agent for registration of transfer, exchange, or payment, and any Certificate
issued is registered in the name of Cede & Co. or such other name as 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.
Series 2004-RS2 Portion of the Class A-6 Principal Balance as of the Closing
Date Evidenced by this Certificate:
$13,164,000.00
Class A-6 Certificate Interest Rate: 5.000%
Closing Date: April 29, 2004
First Distribution Date: May 25, 2004
Last Scheduled Distribution Date: November 25, 2033
Class A-6 Principal Balance
as of the Closing Date: $13,164,000.00
Cede & Co.
Registered Owner
A-6
Exhibit A
CUSIP 92922F PL6
WaMu MORTGAGE PASS-THROUGH CERTIFICATE
Class A-7
Evidencing a beneficial interest in a pool of assets consisting of, among other
things, mortgage pass-through certificates formed and administered by
WASHINGTON MUTUAL MORTGAGE SECURITIES CORP.
This Certificate is issued by WaMu Mortgage Pass-Through Certificates Series
2004-RS2 Trust. This Certificate represents ownership of a "regular interest" in
a "real estate mortgage investment conduit," as those terms are defined in
Sections 860G and 860D, respectively, of the Internal Revenue Code of 1986, as
amended. The issue date of this Certificate is April 29, 2004.
Unless this Certificate is presented by an authorized representative of The
Depository Trust Company, a New York corporation ("DTC"), to the Company or its
agent for registration of transfer, exchange, or payment, and any Certificate
issued is registered in the name of Cede & Co. or such other name as 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.
The Class A-7 Certificates will provide credit support to certain Classes of
Certificates, as described in the Trust Agreement.
Series 2004-RS2 Portion of the Class A-7 Principal Balance as of the Closing
Date Evidenced by this Certificate:
$1,100,000.00
Class A-7 Certificate Interest Rate: 5.000%
Closing Date: April 29, 2004
First Distribution Date: May 25, 2004
Last Scheduled Distribution Date: November 25, 2033
Class A-7 Principal Balance
as of the Closing Date: $1,100,000.00
Cede & Co.
Registered Owner
A-7
Exhibit A
CUSIP 92922F PM4
WaMu MORTGAGE PASS-THROUGH CERTIFICATE
Class R
Evidencing a Percentage Interest in certain distributions with respect to a pool
of mortgage pass-through certificates formed and administered by
WASHINGTON MUTUAL MORTGAGE SECURITIES CORP.
ANY RESALE, TRANSFER OR OTHER DISPOSITION OF THIS CERTIFICATE MAY BE MADE ONLY
IF THE PROPOSED TRANSFEREE PROVIDES A TRANSFER AFFIDAVIT TO THE COMPANY AND THE
TRUSTEE THAT (1) SUCH TRANSFEREE IS NOT EITHER (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 ENABLE THE TRANSFER TO
IMPEDE THE ASSESSMENT OR COLLECTION OF TAX. SUCH AFFIDAVIT SHALL INCLUDE CERTAIN
REPRESENTATIONS AS TO THE FINANCIAL CONDITION OF THE PROPOSED TRANSFEREE.
NOTWITHSTANDING THE REGISTRATION IN THE CERTIFICATE REGISTER OF 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.
IN THE CASE OF ANY CLASS R CERTIFICATE PRESENTED FOR REGISTRATION IN THE NAME OF
ANY PERSON, THE TRUSTEE SHALL REQUIRE (I) AN OFFICER'S CERTIFICATE IN THE FORM
DESCRIBED IN SECTION 5.01(d) OF THE TRUST AGREEMENT AND (II) IF SO INDICATED IN
SUCH OFFICER'S CERTIFICATE, AN OPINION OF COUNSEL ACCEPTABLE TO AND IN FORM AND
SUBSTANCE SATISFACTORY TO THE TRUSTEE AND THE COMPANY TO THE EFFECT THAT THE
PURCHASE AND HOLDING OF A CLASS R CERTIFICATE ARE PERMISSIBLE UNDER APPLICABLE
LAW, WILL NOT CONSTITUTE OR RESULT IN A NON-EXEMPT PROHIBITED TRANSACTION UNDER
SECTION 406 OF THE EMPLOYEE RETIREMENT INCOME SECURITY ACT OF 1974, AS AMENDED
("ERISA"), OR SECTION 4975 OF THE CODE AND WILL NOT SUBJECT THE TRUST, THE
TRUSTEE, THE CERTIFICATE ADMINISTRATOR OR THE COMPANY TO ANY OBLIGATION OR
LIABILITY (INCLUDING OBLIGATIONS OR LIABILITIES UNDER SECTION 406 OF ERISA OR
SECTION 4975 OF THE CODE) IN ADDITION TO THOSE UNDERTAKEN IN THE TRUST
AGREEMENT, WHICH OPINION OF COUNSEL SHALL NOT BE AN EXPENSE OF THE TRUST, THE
TRUSTEE, THE CERTIFICATE ADMINISTRATOR OR THE COMPANY.
This Certificate is issued by WaMu Mortgage Pass-Through Certificates Series
2004-RS2 Trust. Solely for U.S. federal income tax purposes, this Certificate
represents "residual interests" in "real estate mortgage investment conduits,"
as those terms are defined in Sections 860G and 860D, respectively, of the
Internal Revenue Code of 1986, as amended.
Series 2004-RS2 Percentage Interest evidenced by this Class R Certificate in the
distributions to be made with respect to the
Class R Certificates: _________%
Class R Certificate Interest Rate: 5.000%. Additionally the Class R Certificates
are entitled to Excess Liquidation Proceeds and the Residual Distribution Amount
as defined in the Trust Agreement.
Closing Date: April 29, 2004
First Distribution Date: May 25, 2004
Last Scheduled Distribution Date: November 25, 2033
Class R Principal Balance as of the Closing Date: $100.00
------------------
Registered Owner
Certificate No. ___
A-8
Exhibit B
[Reserved]
B-1
Exhibit C
[Reserved]
C-1
Exhibit D
Mortgage Loan Schedule
Copies of the Mortgage Loan Schedule (which has been intentionally
omitted from this filing) may be obtained from Washington Mutual Mortgage
Securities Corp. or Citibank, N.A. by contacting:
in the case of Washington Mutual Mortgage Securities Corp.,
▇▇▇▇▇ ▇▇▇▇▇▇
Master Servicing Department
Washington Mutual Mortgage Securities Corp.
▇▇ ▇. ▇▇▇▇▇▇▇ ▇▇▇▇▇, ▇▇▇▇▇▇▇
▇▇▇▇▇▇ ▇▇▇▇▇, ▇▇ ▇▇▇▇▇
Telephone: (▇▇▇) ▇▇▇-▇▇▇▇
Facsimile: (▇▇▇) ▇▇▇-▇▇▇▇
in the case of Citibank N.A.,
▇▇▇▇▇ ▇▇▇▇▇▇▇▇
Citibank, N.A.
▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇
14th Floor, ▇▇▇▇ ▇
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇
Telephone: (▇▇▇) ▇▇▇-▇▇▇▇
Facsimile: (▇▇▇) ▇▇▇-▇▇▇▇
D-1
Exhibit E
SELLING AND SERVICING
CONTRACT
This Selling and Servicing Contract (this "Agreement") is made and entered into
by Washington Mutual Mortgage Securities Corp. and its successors and assigns
("Washington Mutual Mortgage") and the entity identified below and its
successors and assigns (the "Company").
WITNESSETH:
WHEREAS, this Company wishes to sell first lien residential mortgage
loans to, and service first lien residential mortgage loans on behalf of,
Washington Mutual Mortgage; and
WHEREAS, the Company has submitted a Seller Application to Washington
Mutual Mortgage and has been approved by Washington Mutual Mortgage for
participation in the Washington Mutual Mortgage Purchase Programs; and
WHEREAS, the Company has received and reviewed the Washington Mutual
Mortgage Purchase Programs Seller Guide (the "Seller Guide"), as well as the
Washington Mutual Mortgage Servicing Guide (the "Servicing Guide" and, together
with the Seller Guide, the "Guides"), and understands each and every provision
thereof;
NOW, THEREFORE, in consideration of the premises and of the mutual
agreements herein contained, Washington Mutual Mortgage and the Company hereby
agree as follows:
1. Guides. The Guides, which set forth the terms and conditions under
which Washington Mutual Mortgage may elect to purchase mortgage loans from the
Company, and the Company shall service mortgage loans on behalf of Washington
Mutual Mortgage, are a supplement to this Agreement and such Guides, as may be
amended or supplemented from time to time by Washington Mutual Mortgage, are
incorporated into this Agreement in full by reference and made a part hereof as
fully as if set forth at length herein. All capitalized terms used and not
defined herein have the meanings ascribed to them in the Guides.
2. Company's Duties. The Company shall diligently perform all duties
incident to the origination, sale and servicing of the mortgage loans subject to
this Agreement. In the performance of its servicing duties, the Company shall
exercise the same degree of care it exercises when servicing mortgage loans for
its own account, but in no event shall the Company exercise less care than a
reasonable prudent servicer would exercise under similar circumstances. In
addition, the Company shall comply with all of the provisions of the Guides and
with all other requirements and instructions of Washington Mutual Mortgage. The
Company shall perform such duties at its sole expense, except as otherwise
expressly provided in the Guides.
3. Representations, Warranties and Covenants of the Company; Remedies
of Washington Mutual Mortgage. With respect to each mortgage loan sold by the
Company to Washington Mutual Mortgage pursuant to the terms of this Agreement,
the Company shall make all of the representations, warranties and covenants set
forth in the Guide and, in the event of the breach of any of such
representations, warranties and covenants, Washington Mutual Mortgage shall have
all of the remedies available at law or in equity, as well as all of the
remedies set forth in the Guide, including, but not limited to, repurchase and
indemnification. The representations and warranties made by the Company with
respect to any mortgage loan subject to this Agreement, as well as the remedies
available to Washington Mutual Mortgage upon the breach thereof, shall survive:
(a) any investigation regarding the mortgage loan conducted by Washington Mutual
Mortgage, its assignees or designees, (b) the liquidation of the mortgage loan,
(c) the purchase of the mortgage loan by Washington Mutual Mortgage, its
assignee or designee, (d) the repurchase of the mortgage loan by the Company and
(e) the termination of this Agreement.
E-1
4. Compensation. The Company shall be compensated for its services
hereunder as specified in the Guides.
5. No Assignment. This Agreement may not be assigned by the Company
without the prior written consent of Washington Mutual Mortgage. The Company
hereby consents to the assignment by Washington Mutual Mortgage of all or any
part of its rights and obligations under this Agreement to any affiliate
designated by Washington Mutual Mortgage. Any other transfer by Washington
Mutual Mortgage will be allowed and be effective upon written notice by
Washington Mutual Mortgage to the Company.
6. Prior Agreements. This Agreement supersedes any prior agreements and
understandings between Washington Mutual Mortgage and the Company governing the
subject matter hereof; provided, however, the Company shall not be released from
any responsibility or liability that may have arisen under such agreements and
understanding.
7. Effective Date of Agreement. This Agreement is not effective until
it is executed and accepted by Washington Mutual Mortgage at its home office in
Illinois.
8. Notices. All notices, requests, demands or other communications that
are to be given under this Agreement shall be in writing, addressed to the
appropriate parties, and shall be sent by certified mail, return receipt
requested, postage prepaid, if to the Company, at the address below and, if to
Washington Mutual Mortgage, to the appropriate address or facsimile number
specified in the Guides. Any such notice, request, demand or other communication
shall be deemed effective upon receipt.
9. Independent Contractor. At no time shall the Company represent that
it is acting as an agent, partner or joint venturer of Washington Mutual
Mortgage. The Company shall at all times act as an independent contracting
party.
10. Amendment. This Agreement may not be amended or modified orally,
and no provision of this Agreement may be waived or amended, except in writing
signed by the party against whom enforcement is sought. Such a written waiver or
amendment must expressly reference this Agreement. However, by their terms the
Guides may be amended or supplemented by Washington Mutual Mortgage from time to
time. Any such amendment(s) to the Guides shall be in writing and be binding
upon the parties hereto on and after the effective date specified therein.
11. Miscellaneous. This Agreement, including all documents incorporated
by reference herein, constitutes the entire understanding between the parties
hereto and supersedes all other agreements, covenants, representations,
warranties, understandings and communications between the parties, whether
written or oral, with respect to the transactions contemplated by this
Agreement. All section headings contained herein are for convenience only and
shall not be construed as part of this Agreement. Any provision of this
Agreement that is prohibited or unenforceable in any jurisdiction shall as to
such jurisdiction be ineffective to the extent of such prohibition or
unenforceability without invalidating the remaining portions hereof or affecting
the validity or enforceability of such provision in any other jurisdiction, and
to this end, the provisions hereof are severable. This Agreement shall be
governed by, and construed and enforced in accordance with, applicable federal
laws and laws of the State of Illinois, without reference to conflict of laws
principles. This Agreement may be executed in one or more counterparts, each of
which shall constitute an original and all of which shall constitute the same
Agreement.
E-2
IN WITNESS WHEREOF, the parties have executed this Agreement by proper
officials duly authorized on the dates hereinafter set forth. This Agreement
shall take effect as of the date of its execution in original or facsimile
signature by a duly authorized officer of Washington Mutual Mortgage.
------------------------------------------ ------------------------
Name of the Company Company I.D. Number
------------------------------------------ ------------------------
Type of organization Organized under laws of
--------------------------------------------------------------------------------
Principal place of business: ▇▇▇▇▇▇ ▇▇▇▇▇▇▇, ▇▇▇▇, ▇▇▇▇▇, zip code
--------------------------------------------------------------------------------
Typed name and title of the Company's authorized officer
------------------------------------------------------- -------------------
Signature of the Company's authorized officer Date
Agreed to and accepted by Washington Mutual Mortgage Securities Corp.
--------------------------------------------------------------------------------
Typed name and title of authorized representative
------------------------------------------------------- --------------------
Signature of authorized representative Date
E-3
Exhibit F
[Reserved]
F-1
Exhibit G
[Reserved]
G-1
Exhibit H
FORM OF ADDITIONAL MATTER INCORPORATED INTO
THE FORM OF THE CERTIFICATES
This Certificate does not represent an obligation of or interest in Washington
Mutual Mortgage Securities Corp. or any of its affiliates. Neither this
Certificate nor the Underlying Certificates are guaranteed by any agency or
instrumentality of the United States.
This certifies that the above-named Registered Owner is the registered owner of
certain interests in a pool of assets ("REMIC I") consisting of, among other
things, mortgage pass-through certificates (the "Underlying Certificates"),
formed and administered by Washington Mutual Mortgage Securities Corp. (the
"Company"), which term includes any successor entity under the Trust Agreement
referred to below. REMIC I was created pursuant to an Amended and Restated Trust
Agreement, dated as of the Closing Date stated above (the "Trust Agreement"),
among the Company, Citibank, N.A., as Trustee (the "Trustee"), and Christiana
Bank & Trust Company, as Delaware 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 Trust
Agreement. Nothing herein shall be deemed inconsistent with such meanings, and
in the event of any conflict between the Trust Agreement and the terms of this
Certificate, the Trust Agreement shall control. This Certificate is issued under
and is subject to the terms, provisions and conditions of the Trust Agreement,
to which Trust Agreement the Holder of this Certificate, by virtue of the
acceptance hereof, assents and by which such Holder is bound.
Distributions will be made, pursuant to the Trust Agreement, on the 25th day of
each month or, if such 25th day is not a Business Day, the Business Day
immediately following (the "Distribution Date"), commencing on the first
Distribution Date specified above, to the Person in whose name this Certificate
is registered at the close of business on the last day (or if such last day is
not a Business Day, the Business Day immediately preceding such last day) of the
month immediately preceding the month of such distribution (the "Record Date"),
to the extent of such Certificateholder's Percentage Interest represented by
this Certificate in the portion of the Available Distribution Amount for such
Distribution Date then distributable on the Certificates of this Class, as
specified in Section 4.01 of the Trust Agreement.
Distributions on this Certificate will be made by the Trustee by wire transfer
or check mailed to the address of the Person entitled thereto, as such name and
address shall appear on the Certificate Register. Notwithstanding the above, the
final distribution on this Certificate will be made after due notice by the
Trustee of the pendency of such distribution and only upon presentation and
surrender of this Certificate to the Certificate Registrar.
Reference is hereby made to the further provisions of this Certificate set forth
below, which further provisions shall for all purposes have the same effect as
if set forth at this place.
Unless the certificate of authentication hereon has been executed by or on
behalf of the Trustee, by manual signature, this Certificate shall not be
entitled to any benefit under the Trust Agreement or be valid for any purpose.
H-1
IN WITNESS WHEREOF, the Trust has caused this Certificate to be duly executed.
WaMu MORTGAGE PASS-THROUGH
CERTIFICATES SERIES 2004-RS2 TRUST
By: CITIBANK, N.A., as Trustee
By: _____________________________
(TRUSTEE'S CERTIFICATE OF AUTHENTICATION)
This is one of the Certificates referred to in the
within-mentioned Trust Agreement.
CITIBANK, N.A.,
as Trustee
By:
----------------------------------------
Dated:
-------------------------------------
H-2
WASHINGTON MUTUAL MORTGAGE SECURITIES CORP.
WaMu MORTGAGE PASS-THROUGH CERTIFICATE
This Certificate is one of a duly authorized issue of Certificates designated as
WaMu Mortgage Pass-Through Certificates of the Series and Class specified hereon
(herein called the "Certificates") and representing certain interests in REMIC
I.
The Certificates do not represent an obligation of, or an interest in, the
Company or any of its affiliates and are not insured or guaranteed by any
governmental agency. The Certificates are limited in right of payment to certain
collections and recoveries respecting the Underlying Certificates, all as more
specifically set forth herein and in the Trust Agreement.
As provided in the Trust Agreement, withdrawals from the Certificate Account may
be made from time to time for purposes other than distributions to
Certificateholders, such purposes including reimbursement to the Certificate
Administrator of certain expenses incurred by it.
The Trust Agreement permits, with certain exceptions therein provided, the
amendment thereof and the modification of the rights and obligations of the
Company and the rights of the Certificateholders under the Trust Agreement at
any time by the Company, the Certificate Administrator and the Trustee with the
consent of the Holders of the Certificates evidencing Percentage Interests
aggregating not less than 66% of REMIC I. 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 Trust 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 Trust 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 of the Certificate Registrar or the office maintained by the Trustee in
the City and State of New York, duly endorsed by, or accompanied by an
assignment in the form below or other written instrument of transfer in form
satisfactory to the Trustee or any Authenticating Agent duly executed by, the
Holder hereof or such Holder's attorney duly authorized in writing, and
thereupon one or more new Certificates of Authorized Denominations evidencing
the same Percentage Interest set forth hereinabove will be issued to the
designated transferee or transferees.
The Certificates are issuable only as registered Certificates without coupons in
Authorized Denominations specified in the Trust Agreement. As provided in the
Trust Agreement and subject to certain limitations therein set forth,
Certificates are exchangeable for new Certificates of Authorized Denominations
of like Certificate Principal Balance or Percentage Interest, as applicable, as
requested by the Holder surrendering the same.
A reasonable service charge may be made for any such registration of transfer or
exchange, and the Trustee may require payment of a sum sufficient to cover any
tax or other governmental charge payable in connection therewith.
The Company, the Trustee and the Certificate Registrar and any agent of the
Company, the Trustee or the Certificate Registrar may treat the Person in whose
name this Certificate is registered as the owner hereof for all purposes, and
neither the Company, the Trustee, the Certificate Registrar nor any such agent
shall be affected by notice to the contrary.
H-3
The obligations created by the Trust Agreement and the Trust created thereby
shall terminate upon (i) the later of the maturity or other liquidation
(including purchase by the Certificate Administrator) of the last Underlying
Certificate remaining in the Trust and (ii) the payment to Certificateholders of
all amounts held by the Trustee and required to be paid to them pursuant to the
Trust Agreement. In the event that the Company or the Certificate Administrator
purchases any Underlying Certificate pursuant to the Trust Agreement, the Trust
Agreement generally requires that the Trustee distribute to the
Certificateholders in the aggregate an amount equal to 100% of the unpaid Class
Principal Balance of such Underlying Certificate. The Trust Agreement permits,
but does not require, the Certificate Administrator to purchase from the Trust
all Underlying Certificates at the time subject thereto upon payment to the
Certificateholders of the amounts specified in the Trust Agreement. The exercise
of such right will effect early retirement of the Certificates, the Certificate
Administrator's right to purchase being subject to the aggregate Class Principal
Balance of the Underlying Certificates at the time of purchase being less than
the Clean-Up Call Percentage of the aggregate Class Principal Balance of the
Underlying Certificates as of the Closing Date.
H-4
ASSIGNMENT
FOR VALUE RECEIVED the undersigned hereby sell(s) and assign(s) and
transfer(s) unto ____________________________________________________________
(Please print or typewrite name and address, including postal
zip code of assignee. Please insert social security or other identifying number
of assignee.) the within WaMu Mortgage Pass-Through Certificate and hereby
irrevocably constitutes and appoints _________________________________________
Attorney to transfer said Certificate on the Certificate Register, with
full power of substitution in the premises.
Dated: ______________________ ________________________________________
Signature Guaranteed
__________________________________________________________________________
NOTICE: The signature to this assignment must correspond with the name
as written upon the face of the within instrument in every
particular, without alteration or enlargement or any change
whatever. This Certificate does not represent an obligation of
or an interest in Washington Mutual Mortgage Securities Corp. or
any of its affiliates. Neither this Certificate nor the
underlying Mortgage Loans are guaranteed by any agency or
instrumentality of the United States.
H-5
Exhibit I
TRANSFEROR CERTIFICATE
[Date]
Citibank, N.A., as Trustee
▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇, 14th Floor, ▇▇▇▇ ▇
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇
Attn: Structured Finance Group, Washington Mutual 2004-RS2
Re: Washington Mutual Mortgage Securities Corp. WaMu Mortgage Pass-Through
Certificates, Series 2004-RS2, Class R
Ladies and Gentlemen:
This letter is delivered to you in connection with the sale from (the "Seller")
to (the "Purchaser") of $____________________ initial Certificate Principal
Balance of WaMu Mortgage Pass-Through Certificates, Series 2004-RS2, Class R
(the "Certificate"), pursuant to Section 5.01 of the Amended and Restated Trust
Agreement (the "Trust Agreement"), dated as of April 29, 2004 among Washington
Mutual Mortgage Securities Corp., as depositor and certificate administrator
(the "Company"), Citibank, N.A., as trustee (the "Trustee"), and Christiana Bank
& Trust Company, as Delaware trustee. All terms used herein and not otherwise
defined shall have the meanings set forth in the Trust Agreement. The Seller
hereby certifies, represents and warrants to, and covenants with, the Company,
the Trustee and the Trust that:
1. No purpose of the Seller relating to the sale of the Certificate by the
Seller to the Purchaser is or will be to enable the Seller to impede the
assessment or collection of tax.
2. The Seller understands that the Purchaser has delivered to the Trustee and
the Company a transferee affidavit and agreement in the form attached to the
Trust Agreement as Exhibit J. The Seller does not know or believe that any
representation contained therein is false.
3. The Seller has no actual knowledge that the proposed Transferee is not a
Permitted Transferee.
4. The Seller has no actual knowledge that the Purchaser would be unwilling or
unable to pay taxes due on its share of the taxable income attributable to the
Certificates.
5. The Seller has conducted a reasonable investigation of the financial
condition of the Purchaser and, as a result of the investigation, found that the
Purchaser has historically paid its debts as they came due, and found no
significant evidence to indicate that the Purchaser will not continue to pay its
debts as they come due in the future.
I-1
6. The Purchaser has represented to the Seller that, if the Certificates
constitute a noneconomic residual interest, it (i) understands that as holder of
a noneconomic residual interest it may incur tax liabilities in excess of any
cash flows generated by the interest, and (ii) intends to pay taxes associated
with its holding of the Certificates as they become due.
Very truly yours,
[Seller]
By: ________________________________
Name:
Title:
I-2
Exhibit J
TRANSFEREE AFFIDAVIT AND AGREEMENT
STATE OF )
) ss:
COUNTY OF )
[NAME OF OFFICER], being first duly sworn, deposes and says:
1. That he is [Title of Officer] of [Name of Owner] (record or beneficial owner
of the Class R Certificate (the "Owner")), a [savings institution] [corporation]
duly organized and existing under the laws of [the State of ] [the United
States], on behalf of which he makes this affidavit and agreement.
2. That the Owner (i) is not and will not be a "disqualified organization" as of
[date of transfer] within the meaning of Section 860E(e)(5) of the Internal
Revenue Code of 1986, as amended (the "Code") and will endeavor to remain other
than a disqualified organization for so long as it retains its ownership
interest in the Class R Certificates, and (ii) is acquiring the Class R
Certificates for its own account or for the account of another Owner from which
it has received an affidavit and agreement in substantially the same form as
this affidavit and agreement. (For this purpose, a disqualified organization"
means the United States, any state or political subdivision thereof, or any
agency or instrumentality of any of the foregoing (other than an instrumentality
all of the activities of which are subject to tax and, except for the Federal
Home Loan Mortgage Corporation, a majority of whose board of directors is not
selected by any such governmental entity), or any foreign government or
international organization, or any agency or instrumentality of such foreign
government or organization, any rural electric or telephone cooperative, or any
organization (other than certain farmers' cooperatives) that is generally exempt
from federal income tax unless such organization is subject to the tax on
unrelated business taxable income).
3. That the Owner is aware (i) of the tax that would be imposed on transfers of
the Class R Certificates after March 31, 1988; (ii) that such tax would be on
the transferor, or, if such transfer is through an agent (which person includes
a broker, nominee or middle-man) for a disqualified organization, on the agent;
(iii) that the person otherwise liable for the tax shall be relieved of
liability for the tax if the transferee furnishes to such person an affidavit
that the transferee is not a disqualified organization and, at the time of
transfer, such person does not have actual knowledge that the affidavit is
false; and (iv) that the Class R Certificates 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,
if a significant purpose of the transfer was to enable the transferor to impede
the assessment or collection of tax.
4. That the Owner is aware of the tax imposed on a "pass-through entity" holding
the Class R Certificates if at any time during the taxable year of the
pass-through entity a disqualified organization is the record holder of an
interest in such entity. (For this purpose, a "pass through entity" includes a
regulated investment company, a real estate investment trust or common trust
fund, a partnership, trust or estate, and certain cooperatives.)
J-1
5. That the Owner is aware that the Trustee will not register the Transfer of
the Class R Certificates unless the transferee, or the transferees' agent,
delivers to it an affidavit and agreement, among other things, in substantially
the same form as this affidavit and agreement. The Owner expressly agrees that
it will not consummate any such transfer if it knows or believes that any of the
representations contained in such affidavit and agreement are false.
6. That the Owner has reviewed the restrictions set forth on the face of the
Class R Certificates and the provisions of Section 5.01 of the Trust Agreement
under which the Class R Certificates were issued (in particular, clauses
(iii)(A) and (iii)(B) of Section 5.01(c) which authorize the Trustee to deliver
payments to a person other than the Owner and negotiate a mandatory sale by the
Trustee in the event the Owner holds such Certificates in violation of Section
5.01). The Owner expressly agrees to be bound by and to comply with such
restrictions and provisions.
7. That the Owner consents to any additional restrictions or arrangements that
shall be deemed necessary upon advice of counsel to constitute a reasonable
arrangement to ensure that the Class R Certificates will only be owned, directly
or indirectly, by an Owner that is not a disqualified organization.
8. The Owner's Taxpayer Identification Number is .
9. That no purpose of the Owner relating to the purchase of the Class R
Certificates by the Owner is or will be to enable the transferor to impede the
assessment or collection of tax, and that in making this representation, the
Owner warrants that the Owner is familiar with Treasury Regulation 1.860E-1(c)
and with the preamble to the adoption of amendments to that regulation as of
July 19, 2002, attached hereto as Exhibit 1.
10. That the Owner anticipates that it will, so long as it holds the Class R
Certificates, have sufficient assets to pay any taxes owed by the holder of such
Certificates, and hereby represents to and for the benefit of the person from
whom it acquired the Class R Certificates that the Owner intends to pay taxes
associated with holding such Certificates as they become due, fully
understanding that it may incur tax liabilities in excess of any cash flows
generated by the Class R Certificates. That the Owner has provided financial
statements or other financial information requested by the transferor in
connection with the transfer of the Class R Certificates to permit the
transferor to assess the financial capability of the Owner to pay such taxes.
11. That the Owner has no present knowledge or expectation that it will be
unable to pay any United States taxes owed by it so long as any of the Class R
Certificates remain outstanding.
12. That the Owner has no present knowledge or expectation that it will become
insolvent or subject to a bankruptcy proceeding for so long as any of the Class
R Certificates remain outstanding.
13. That the Owner is familiar with Treasury Regulation 1.860E-1(c) and with the
preamble to the adoption of amendments to that regulation as of July 19, 2002,
attached hereto as Exhibit 1, and that no purpose of the Owner relating to any
sale of the Class R Certificates by the Owner will be to impede the assessment
or collection of tax.
14. The Owner is a citizen or resident of the United States, a corporation,
partnership or other entity treated as a partnership or corporation for U.S.
federal income tax purposes created or organized in, or under the laws of, the
United States or any state thereof or the District of Columbia, or an estate or
trust whose income from sources without the United States is includible in gross
income for United States federal income tax purposes regardless of its
J-2
connection with the conduct of a trade or business within the United States.
15. The Owner hereby agrees that it will not cause income from the Class R
Certificates to be attributable to a foreign permanent establishment or fixed
base (within the meaning of an applicable income tax treaty) of the Owner or
another United States taxpayer.
16. The Owner hereby agrees to cooperate with the Company and to take any action
required of it by the Code or Treasury regulations thereunder (whether now or
hereafter promulgated) in order to create or maintain the REMIC status of REMIC
I (the "REMIC").
17. The Owner hereby agrees that it will not take any action that could endanger
the REMIC status of the REMIC or result in the imposition of tax on the REMIC
unless counsel for, or acceptable to, the Company has provided an opinion that
such action will not result in the loss of such REMIC status or the imposition
of such tax, as applicable.
18. The Owner as transferee of the Class R Certificates has represented to the
transferor that, if the Class R Certificates constitute a noneconomic residual
interest, the Owner (i) understands that as holder of a noneconomic residual
interest it may incur tax liabilities in excess of any cash flows generated by
the interest, and (ii) intends to pay taxes associated with its holding of the
Class R Certificates as they become due.
19. That the Owner satisfies the condition in the paragraph marked
below [▇▇▇▇ one paragraph only]:
___ The Owner is not an employee benefit or other plan subject to the prohibited
transaction provisions of the Employee Retirement Income Security Act of 1974,
as amended, or Section 4975 of the Internal Revenue Code of 1986, as amended (a
"Plan"), or any other person (including an investment manager, a named fiduciary
or a trustee of any Plan) acting, directly or indirectly, on behalf of, or
purchasing the Class R Certificates with "plan assets" of, any Plan within the
meaning of the Department of Labor ("DOL") regulation at 29 C.F.R. Section
2510.3-101.
___ The Owner has delivered a Benefit Plan Opinion (as defined in Section 1.01
of the Trust Agreement under which the Class R Certificates were issued).
IN WITNESS WHEREOF, the Owner has caused this instrument to be executed on its
behalf, pursuant to the authority of its Board of Directors, by its [Title of
Officer] and its corporate seal to be hereunto attached, attested by its
[Assistant] Secretary, this day of , 20 __ .
[Name of Owner]
By:______________________________
[Name of Officer]
[Title of Officer]
[Corporate Seal]
ATTEST:
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[Assistant] Secretary
Personally appeared before me the above-named [Name of Officer], known or proved
to me to be the same person who executed the foregoing instrument and to be the
[Title of Officer] of the Owner, and Acknowledged to me that he executed the
same as his free act and deed and the free act and deed of the Owner.
Subscribed and sworn before me this ___ day of __________________, 20__.
NOTARY PUBLIC
COUNTY OF
STATE OF
My Commission expires the day
of , 20
-------------- ----
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Exhibit 1 to Transferee Affidavit
DEPARTMENT OF THE TREASURY
Internal Revenue Service
26 CFR Parts 1 and 602
[TD 9004]
RIN 1545-AW98
Real Estate Mortgage Investment Conduits
AGENCY: Internal Revenue Service (IRS), Treasury.
ACTION: Final regulations.
-----------------------------------------------------------------------
SUMMARY: This document contains final regulations relating to safe harbor
transfers of noneconomic residual interests in real estate mortgage investment
conduits (REMICs). The final regulations provide additional limitations on the
circumstances under which transferors may claim safe harbor treatment.
DATES: Effective Date: These regulations are effective July 19, 2002.
Applicability Date: For dates of applicability, see Sec. 1.860E-
(1)(c)(10).
FOR FURTHER INFORMATION CONTACT: ▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇▇ at (▇▇▇) ▇▇▇-▇▇▇▇ (not a
toll-free number).
SUPPLEMENTARY INFORMATION:
Paperwork Reduction Act
The collection of information in this final rule has been reviewed and, pending
receipt and evaluation of public comments, approved by the Office of Management
and Budget (OMB) under 44 U.S.C. 3507 and assigned control number 1545-1675. The
collection of information in this regulation is in Sec. 1.860E-1(c)(5)(ii). This
information is required to enable the IRS to verify that a taxpayer is complying
with the conditions of this regulation. The collection of information is
mandatory and is required. Otherwise, the taxpayer will not receive the benefit
of safe harbor treatment as provided in the regulation. The likely respondents
are businesses and other for-profit institutions.
Comments on the collection of information should be sent to the Office of
Management and Budget, Attn: Desk Officer for the Department of the Treasury,
Office of Information and Regulatory Affairs, ▇▇▇▇▇▇▇▇▇▇, ▇▇, ▇▇▇▇▇, with copies
to the Internal Revenue Service, Attn: IRS Reports Clearance Officer,
W:CAR:MP:FP:S, ▇▇▇▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇. Comments on the collection of information
should be received by September 17, 2002. Comments are specifically requested
concerning:
Whether the collection of information is necessary for the proper performance of
the functions of the Internal Revenue Service, including whether the information
will have practical utility;
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The accuracy of the estimated burden associated with the collection
of information (see below);
How the quality, utility, and clarity of the information to be collected may be
enhanced;
How the burden of complying with the collection of information may be minimized,
including through the application of automated collection techniques or other
forms of information technology; and
Estimates of capital or start-up costs and costs of operation, maintenance, and
purchase of service to provide information.
An agency may not conduct or sponsor, and a person is not required to respond
to, a collection of information unless it displays a valid control number
assigned by the Office of Management and Budget.
The estimated total annual reporting burden is 470 hours, based on an estimated
number of respondents of 470 and an estimated average annual burden hours per
respondent of one hour.
Books or records relating to a collection of information must be retained as
long as their contents may become material in the administration of any internal
revenue law. Generally, tax returns and tax return information are confidential,
as required by 26 U.S.C. 6103.
Background
This document contains final regulations regarding the proposed amendments to 26
CFR part 1 under section 860E of the Internal Revenue Code (Code). The
regulations provide the circumstances under which a transferor of a noneconomic
REMIC residual interest meeting the investigation and representation
requirements may avail itself of the safe harbor by satisfying either the
formula test or the asset test.
Final regulations governing REMICs, issued in 1992, contain rules governing the
transfer of noneconomic REMIC residual interests. In general, a transfer of a
noneconomic residual interest is disregarded for all tax purposes if a
significant purpose of the transfer is to enable the transferor to impede the
assessment or collection of tax. A purpose to impede the assessment or
collection of tax (a wrongful purpose) exists if the transferor, at the time of
the transfer, either knew or should have known that the transferee would be
unwilling or unable to pay taxes due on its share of the REMIC's taxable income.
Under a safe harbor, the transferor of a REMIC noneconomic residual interest is
presumed not to have a wrongful purpose if two requirements are satisfied: (1)
the transferor conducts a reasonable investigation of the transferee's financial
condition (the investigation requirement); and (2) the transferor secures a
representation from the transferee to the effect that the transferee understands
the tax obligations associated with holding a residual interest and intends to
pay those taxes (the representation requirement).
The IRS and Treasury have been concerned that some transferors of noneconomic
residual interests claim they satisfy the safe harbor even in situations where
the economics of the transfer clearly indicate the transferee is unwilling or
unable to pay the tax associated with holding the interest. For this reason, on
February 7, 2000, the IRS published in the Federal Register (65 FR 5807) a
notice of proposed rulemaking (REG-100276-97; REG-122450-98) designed to clarify
the safe harbor by adding the "formula test," an economic test. The proposed
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regulation provides that the safe harbor is unavailable unless the present value
of the anticipated tax liabilities associated with holding the residual interest
does not exceed the sum of: (1) The present value of any consideration given to
the transferee to acquire the interest; (2) the present value of the expected
future distributions on the interest; and (3) the present value of the
anticipated tax savings associated with holding the interest as the REMIC
generates losses.
The notice of proposed rulemaking also contained rules for FASITs. Section
1.860H-6(g) of the proposed regulations provides requirements for transfers of
FASIT ownership interests and adopts a safe harbor by reference to the safe
harbor provisions of the REMIC regulations.
In January 2001, the IRS published Rev. Proc. 2001-12 (2001-3 I.R.B. 335) to set
forth an alternative safe harbor that taxpayers could use while the IRS and the
Treasury considered comments on the proposed regulations. Under the alternative
safe harbor, if a transferor meets the investigation requirement and the
representation requirement but the transfer fails to meet the formula test, the
transferor may invoke the safe harbor if the transferee meets a two-prong test
(the asset test). A transferee generally meets the first prong of this test if,
at the time of the transfer, and in each of the two years preceding the year of
transfer, the transferee's gross assets exceed $100 million and its net assets
exceed $10 million. A transferee generally meets the second prong of this test
if it is a domestic, taxable corporation and agrees in writing not to transfer
the interest to any person other than another domestic, taxable corporation that
also satisfies the requirements of the asset test. A transferor cannot rely on
the asset test if the transferor knows, or has reason to know, that the
transferee will not comply with its written agreement to limit the restrictions
on subsequent transfers of the residual interest.
Rev. Proc. 2001-12 provides that the asset test fails to be satisfied in the
case of a transfer or assignment of a noneconomic residual interest to a foreign
branch of an otherwise eligible transferee. If such a transfer or assignment
were permitted, a corporate taxpayer might seek to claim that the provisions of
an applicable income tax treaty would resource excess inclusion income as
foreign source income, and that, as a consequence, any U.S. tax liability
attributable to the excess inclusion income could be offset by foreign tax
credits. Such a claim would impede the assessment or collection of U.S. tax on
excess inclusion income, contrary to the congressional purpose of assuring that
such income will be taxable in all events. See, e.g., sections 860E(a)(1), (b),
(e) and 860G(b) of the Code.
The Treasury and the IRS have learned that certain taxpayers transferring
noneconomic residual interests to foreign branches have attempted to rely on the
formula test to obtain safe harbor treatment in an effort to impede the
assessment or collection of U.S. tax on excess inclusion income. Accordingly,
the final regulations provide that if a noneconomic residual interest is
transferred to a foreign permanent establishment or fixed base of a U.S.
taxpayer, the transfer is not eligible for safe harbor treatment under either
the asset test or the formula test. The final regulations also require a
transferee to represent that it will not cause income from the noneconomic
residual interest to be attributable to a foreign permanent establishment or
fixed base.
Section 1.860E-1(c)(8) provides computational rules that a taxpayer may use to
qualify for safe harbor status under the formula test. Section 1.860E-1(c)(8)(i)
provides that the transferee is presumed to pay tax at a rate equal to the
highest rate of tax specified in section 11(b). Some commentators were concerned
that this presumed rate of taxation was too high because it does not take into
consideration taxpayers subject to the alternative minimum tax rate. In light of
the comments received, this provision has been amended in the final regulations
to allow certain transferees that compute their taxable income using the
alternative minimum tax rate to use the alternative minimum tax rate applicable
to corporations.
Additionally, Sec. 1.860E-1(c)(8)(iii) provides that the present values in the
formula test are to be computed using a discount rate equal to the applicable
Federal short-term rate prescribed by section 1274(d). This is a change from the
proposed regulation and Rev. Proc. 2001-12. In those publications the provision
stated that "present values are computed using a discount rate equal to the
applicable Federal rate prescribed in section 1274(d) compounded semiannually"
and that "[a] lower discount rate may be used if the transferee can demonstrate
that it regularly borrows, in the course of its trade or business, substantial
funds at such lower rate from an unrelated third party." The IRS and the
Treasury Department have learned that, based on this provision, certain
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taxpayers have been attempting to use unrealistically low or zero interest rates
to satisfy the formula test, frustrating the intent of the test. Furthermore,
the Treasury Department and the IRS believe that a rule allowing for a rate
other than a rate based on an objective index would add unnecessary complexity
to the safe harbor. As a result, the rule in the proposed regulations that
permits a transferee to use a lower discount rate, if the transferee can
demonstrate that it regularly borrows substantial funds at such lower rate, is
not included in the final regulations; and the Federal short-term rate has been
substituted for the applicable Federal rate. To simplify taxpayers'
computations, the final regulations allow use of any of the published short-term
rates, provided that the present values are computed with a corresponding period
of compounding. With the exception of the provisions relating to transfers to
foreign branches, these changes generally have the proposed applicability date
of February 4, 2000, but taxpayers may choose to apply the interest rate formula
set forth in the proposed regulation and Rev. Proc. 2001-12 for transfers
occurring before August 19, 2002.
It is anticipated that when final regulations are adopted with respect to
FASITs, Sec. 1.860H-6(g) of the proposed regulations will be adopted in
substantially its present form, with the result that the final regulations
contained in this document will also govern transfers of FASIT ownership
interests with substantially the same applicability date as is contained in this
document.
Effect on Other Documents
Rev. Proc. 2001-12 (2001-3 I.R.B. 335) is obsolete for transfers of noneconomic
residual interests in REMICs occurring on or after August 19, 2002.
Special Analyses
It is hereby certified that these regulations will not have a significant
economic impact on a substantial number of small entities. This certification is
based on the fact that it is unlikely that a substantial number of small
entities will hold REMIC residual interests. Therefore, a Regulatory Flexibility
Analysis under the Regulatory Flexibility Act (5 U.S.C. chapter 6) is not
required. It has been determined that this Treasury decision is not a
significant regulatory action as defined in Executive Order 12866. Therefore, a
regulatory assessment is not required. It also has been determined that sections
553(b) and 553(d) of the Administrative Procedure Act (5 U.S.C. chapter 5) do
not apply to these regulations.
Drafting Information
The principal author of these regulations is ▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇▇. However, other
personnel from the IRS and Treasury Department participated in their
development.
List of Subjects
26 CFR Part 1
Income taxes, Reporting and record keeping requirements.
26 CFR Part 602
Reporting and record keeping requirements.
Adoption of Amendments to the Regulations
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Accordingly, 26 CFR parts 1 and 602 are amended as follows:
PART 1--INCOME TAXES
Paragraph 1. The authority citation for part 1 continues to read in part as
follows:
Authority: 26 U.S.C. 7805 * * *
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