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TRUST AND SERVICING AGREEMENT
Dated as of January 1, 2003
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among
GS MORTGAGE SECURITIES CORP., as Depositor,
FAIRBANKS CAPITAL CORP., as a Servicer,
WILSHIRE CREDIT CORPORATION, as a Servicer and Master Servicer,
and
JPMORGAN CHASE BANK, as Trustee
GSRPM MORTGAGE PASS-THROUGH CERTIFICATES, SERIES 2003-1
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TABLE OF CONTENTS
PAGE
ARTICLE I DEFINITIONS; RULES OF CONSTRUCTION
1.01 DEFINITIONS...........................................................................................4
1.02 USE OF WORDS AND PHRASES.............................................................................46
1.03 CAPTIONS; TABLE OF CONTENTS..........................................................................46
1.04 OPINIONS.............................................................................................46
1.05 ALLOCATION OF CERTAIN INTEREST SHORTFALLS............................................................46
ARTICLE II ESTABLISHMENT AND ORGANIZATION OF THE TRUST
2.01 ESTABLISHMENT OF THE TRUST...........................................................................48
2.02 OFFICE...............................................................................................48
2.03 PURPOSES AND POWERS..................................................................................48
2.04 APPOINTMENT OF THE TRUSTEE; DECLARATION OF TRUST.....................................................48
2.05 EXPENSES OF THE TRUST................................................................................48
2.06 OWNERSHIP OF THE TRUST...............................................................................48
2.07 SITUS OF THE TRUST...................................................................................49
2.08 THE MORTGAGE LOANS...................................................................................49
2.09 THE CERTIFICATES.....................................................................................49
2.10 INDEMNIFICATION WITH RESPECT TO CERTAIN TAXES AND LOSS OF REMIC STATUS...............................49
ARTICLE III REPRESENTATIONS, WARRANTIES AND COVENANTS OF THE
DEPOSITOR AND THE SERVICERS; REMEDIES UPON BREACHES
3.01 REPRESENTATIONS AND WARRANTIES OF THE DEPOSITOR......................................................50
3.02 REPRESENTATIONS AND WARRANTIES OF THE SERVICERS......................................................52
3.03 REMEDIES UPON BREACH OF REPRESENTATIONS AND WARRANTIES BY THE DEPOSITOR OR A SELLER..................56
3.04 CONVEYANCE OF THE MORTGAGE LOANS.....................................................................58
3.05 ACCEPTANCE BY TRUSTEE; CERTIFICATION BY TRUSTEE......................................................61
3.06 NONQUALIFIED MORTGAGE LOAN...........................................................................63
ARTICLE IV ISSUANCE AND SALE OF CERTIFICATES
4.01 ISSUANCE OF CERTIFICATES.............................................................................64
4.02 SALE OF CERTIFICATES.................................................................................64
ARTICLE V THE CERTIFICATES
5.01 THE CERTIFICATES.....................................................................................64
5.02 REGISTER; REGISTRATION OF TRANSFER AND EXCHANGE OF CERTIFICATES......................................65
5.03 MUTILIATED, DESTROYED, LOST OR STOLEN CERTIFICATES...................................................70
5.04 PERSONS DEEMED OWNERS................................................................................71
5.05 ACCESS TO LIST OF CERTIFICATEHOLDERS' NAMES AND ADDRESSES............................................71
5.06 MAINTENANCE OF OFFICE OR AGENCY......................................................................71
5.07 RIGHTS OF THE CERTIFICATE INSURER TO EXERCISE RIGHTS OF CLASS A CERTIFICATEHOLDERS...................72
5.08 CERTIFICATE INSURER DEFAULT..........................................................................72
ARTICLE VI COVENANTS
6.01 DISTRIBUTIONS........................................................................................73
6.02 MONEY FOR DISTRIBUTIONS TO BE HELD IN TRUST; WITHHOLDING.............................................73
6.03 PROTECTION OF TRUST ESTATE...........................................................................74
6.04 PERFORMANCE OF OBLIGATIONS...........................................................................75
6.05 NEGATIVE COVENANTS...................................................................................75
6.06 NO OTHER POWERS......................................................................................76
6.07 LIMITATION OF SUITS..................................................................................76
6.08 UNCONDITIONAL RIGHTS OF OWNERS TO RECEIVE DISTRIBUTIONS..............................................77
6.09 RIGHTS AND REMEDIES CUMULATIVE.......................................................................77
6.10 DELAY OR OMISSION NOT WAIVER.........................................................................78
6.11 CONTROL BY DEPOSITOR OR OWNERS.......................................................................78
6.12 INDEMNIFICATION......................................................................................78
ARTICLE VII PAYMENTS TO THE CERTIFICATEHOLDERS
7.01 ESTABLISHMENT OF CERTIFICATE ACCOUNT; DEPOSITS IN CERTIFICATE ACCOUNT; PERMITTED WITHDRAWALS
FROM CERTIFICATE ACCOUNT.............................................................................79
7.02 RESERVED.............................................................................................79
7.03 THE CERTIFICATE INSURANCE POLICY.....................................................................79
7.04 INVESTMENT OF ACCOUNTS...............................................................................80
7.05 ELIGIBLE INVESTMENT..................................................................................80
7.06 PRIORITY AND SUBORDINATION OF DISTRIBUTIONS..........................................................81
7.07 ALLOCATION OF REALIZED LOSSES........................................................................87
7.08 STATEMENTS...........................................................................................88
7.09 REPORTS OF FORECLOSURE AND ABANDONMENT OF MORTGAGED PROPERTY.........................................93
7.10 RESERVE FUND.........................................................................................93
ARTICLE VIII SERVICING AND ADMINISTRATION OF MORTGAGE LOANS BY
FAIRBANKS AND WILSHIRE
8.01 FAIRBANKS AND WILSHIRE...............................................................................94
8.02 COLLECTION OF CERTAIN MORTGAGE LOAN PAYMENTS.........................................................96
8.03 LIABILITY OF SERVICER; INDEMNIFICATION...............................................................97
8.04 COLLECTION ACCOUNT..................................................................................100
8.05 ADVANCES............................................................................................103
8.06 COMPENSATING INTEREST...............................................................................105
8.07 ESCROW ACCOUNT AND SIMPLE INTEREST EXCESS SUB-ACCOUNT...............................................105
8.08 MAINTENANCE OF INSURANCE............................................................................108
8.09 DUE-ON-SALE CLAUSES; ASSUMPTION AND SUBSTITUTION AGREEMENTS.........................................109
8.10 DEFAULTED MORTGAGE LOANS; MODIFICATION..............................................................110
8.11 TRUSTEE TO COOPERATE; RELEASE OF FILES..............................................................112
8.12 SERVICING COMPENSATION..............................................................................114
8.13 ANNUAL STATEMENT AS TO COMPLIANCE...................................................................114
8.14 ANNUAL INDEPENDENT CERTIFIED PUBLIC ACCOUNTANTS' REPORTS............................................115
8.15 ACCESS TO CERTAIN DOCUMENTATION AND INFORMATION REGARDING THE MORTGAGE LOANS; STAFFING..............115
8.16 ASSIGNMENT OF AGREEMENT.............................................................................115
8.17 REMOVAL OF SERVICER; RESIGNATION OF SERVICER........................................................116
8.18 SUCCESSOR SERVICERS.................................................................................120
8.19 INSPECTIONS OF SERVICERS; ERRORS AND OMISSIONS INSURANCE............................................122
8.20 NON-SOLICITATION....................................................................................123
8.21 MAJORITY CLASS X CERTIFICATEHOLDER PURCHASE RIGHT...................................................123
8.22 PERIODIC FILINGS....................................................................................124
8.23 CREDIT REPORTING; ▇▇▇▇▇-▇▇▇▇▇-▇▇▇▇▇▇ ACT............................................................124
ARTICLE IX MASTER SERVICING AND ADMINISTRATION OF CONTRACTS
9.01 MASTER SERVICER.....................................................................................125
9.02 OBLIGATION OF THE MASTER SERVICER IN RESPECT OF MONTHLY ADVANCES....................................125
9.03 OBLIGATION OF THE MASTER SERVICER IN RESPECT OF COMPENSATING INTEREST...............................125
9.04 TRUSTEE'S OBLIGATIONS IN RESPECT OF THE CONTRACTS...................................................126
9.05 DEPOSITOR'S OBLIGATIONS IN RESPECT OF THE CONTRACTS.................................................126
ARTICLE X TERMINATION OF TRUST
10.01 TERMINATION OF TRUST................................................................................128
10.02 TERMINATION UPON OPTION OF CERTIFICATEHOLDERS.......................................................129
10.03 TERMINATION UPON LOSS OF REMIC STATUS...............................................................129
10.04 DISPOSITION OF PROCEEDS.............................................................................130
10.05 FINAL DISTRIBUTION ON THE CERTIFICATES..............................................................130
ARTICLE XI THE TRUSTEE
11.01 CERTAIN DUTIES AND RESPONSIBILITIES.................................................................131
11.02 CERTAIN RIGHTS OF THE TRUSTEE.......................................................................134
11.03 NOT RESPONSIBLE FOR RECITALS OR ISSUANCE OF CERTIFICATES............................................135
11.04 MAY HOLD CERTIFICATES...............................................................................136
11.05 MONEY HELD IN TRUST.................................................................................136
11.06 COMPENSATION AND REIMBURSEMENT; NO LIEN FOR FEES....................................................136
11.07 CORPORATE TRUSTEE REQUIRED; ELIGIBILITY.............................................................136
11.08 RESIGNATION AND REMOVAL; APPOINTMENT OF SUCCESSOR...................................................137
11.09 ACCEPTANCE OF APPOINTMENT BY SUCCESSOR TRUSTEE......................................................139
11.10 MERGER, CONVERSION, CONSOLIDATION OR SUCCESSION TO BUSINESS OF THE TRUSTEE..........................139
11.11 REPORTING; WITHHOLDING..............................................................................140
11.12 LIABILITY OF THE TRUSTEE............................................................................140
11.13 APPOINTMENT OF CO-TRUSTEE OR SEPARATE TRUSTEE.......................................................141
ARTICLE XII MISCELLANEOUS
12.01 COMPLIANCE CERTIFICATES AND OPINIONS................................................................143
12.02 FORM OF DOCUMENTS DELIVERED TO THE TRUSTEE..........................................................143
12.03 ACTS OF OWNERS......................................................................................144
12.04 NOTICES, ETC. TO TRUSTEE............................................................................145
12.05 NOTICES AND REPORTS TO OWNERS; WAIVER OF NOTICES....................................................145
12.06 RULES BY TRUSTEE....................................................................................145
12.07 SUCCESSORS AND ASSIGNS..............................................................................146
12.08 SEVERABILITY........................................................................................146
12.09 BENEFITS OF AGREEMENT...............................................................................146
12.10 LEGAL HOLIDAYS......................................................................................146
12.11 GOVERNING LAW; SUBMISSION TO JURISDICTION...........................................................146
12.12 COUNTERPARTS........................................................................................147
12.13 [RESERVED]..........................................................................................147
12.14 AMENDMENT...........................................................................................147
12.15 PAYING AGENT; APPOINTMENT AND ACCEPTANCE OF DUTIES..................................................148
12.16 REMIC STATUS........................................................................................149
12.17 ADDITIONAL LIMITATION ON ACTION AND IMPOSITION OF TAX ON THE TRUST REMICS...........................152
12.18 TAX MATTERS PERSON..................................................................................153
12.19 NOTICES.............................................................................................153
EXHIBITS AND SCHEDULES
Schedule I Schedule of Mortgage Loans
Exhibit A-1 Form of Offered Certificate
Exhibit A-2 Form of Class X Certificate
Exhibit A-3 Form of Class P Certificate
Exhibit A-4 Form of Residual Certificate
Exhibit B Certificate Insurance Policy
Exhibit C Fairbanks Servicing Standards
Exhibit D Wilshire Servicing Standards
Exhibit E Form of Power of Attorney
Exhibit F Form of Initial Certification
Exhibit G Form of Transfer Affidavit
Exhibit H Form of Transferor Certificate
Exhibit I Form of Rule 144A Letter
Exhibit J-1 Form of Request for Release of Documents
Exhibit J-2 Paperless Release Template
Exhibit K Form of Certification to be provided with Form 10-K
Exhibit L-1 Form of Certification to be provided to Depositor by
Trustee
Exhibit L-2 Form of Certification to be provided to Depositor by
Servicers
Exhibit M Sale Agreements
Exhibit N Wilshire HOEPA Calculation
TRUST AND SERVICING AGREEMENT (this "AGREEMENT"), relating to
GSRPM MORTGAGE LOAN TRUST 2003-1 (the "TRUST"), dated as of January 1, 2003, by
and among GS MORTGAGE SECURITIES CORP., a Delaware corporation, as depositor
(the "DEPOSITOR"), FAIRBANKS CAPITAL CORP., a Utah corporation ("FAIRBANKS"), in
its capacity as a servicer (a "SERVICER"), WILSHIRE CREDIT CORPORATION, a Nevada
corporation ("WILSHIRE"), in its capacity as a servicer (a "SERVICER") and as
master servicer (the "MASTER SERVICER") and JPMORGAN CHASE BANK, a New York
banking corporation, as trustee (the "TRUSTEE") of the Trust.
WHEREAS, the Depositor wishes to establish the Trust and to
provide for the allocation and sale of the beneficial interests therein and the
maintenance and distribution thereof;
WHEREAS, Fairbanks and Wilshire currently service certain
fixed rate and adjustable rate residential mortgage loans pursuant a servicing
agreement applicable to each such Servicer;
WHEREAS, GreenPoint Credit LLC ("GREENPOINT") currently
services certain manufactured housing installment sale contracts and installment
loan agreements (the "Contracts") pursuant to a servicing agreement;
WHEREAS, each of Fairbanks and Wilshire have agreed, pursuant
to this Agreement, to continue to service their relevant mortgage loans and
GreenPoint has agreed, pursuant to the GreenPoint Servicing Agreement, to
continue to service the Contracts, which are collectively referred to herein as
the "Mortgage Loans" and constitute the principal assets of the Trust Estate
pursuant to the terms hereof;
WHEREAS, Wilshire has agreed pursuant to the terms of this
Agreement to master service the Contracts;
WHEREAS, all things necessary to make the Certificates, when
executed and authenticated by the Trustee, valid instruments, and to make this
Agreement a valid agreement, in accordance with their and its terms, have been
done; and
WHEREAS, JPMorgan Chase Bank is willing to serve in the
capacity of Trustee hereunder;
NOW, THEREFORE, in consideration of the premises and the
mutual agreements herein contained, the Depositor, Fairbanks, Wilshire and the
Trustee hereby agree as follows:
CONVEYANCE
The Depositor hereby bargains, sells, conveys, assigns and
transfers to the Trustee on behalf of the Trust, without recourse (except as
otherwise provided herein) and for the exclusive benefit of the Owners of the
Certificates and the Certificate Insurer, all of its rights, title and interests
of every kind and nature whatsoever, whether now owned and existing or hereafter
acquired or arising, in and to the following: (a) the
Mortgage Loans listed in SCHEDULE I to this Agreement, which the Depositor is
causing to be delivered to the Trustee concurrently herewith, together with the
related Other Assets, including, without limitation, the related Servicing Files
and other Records and the Depositor's interest in any Mortgaged Property
securing a Mortgage Loan which has been acquired by foreclosure or deed in lieu
of foreclosure, all contract rights and general intangibles in respect of the
foregoing, and all payments thereon and proceeds of the conversion, voluntary or
involuntary, of the foregoing; (b) the rights and interests (but not the
obligations) of Depositor in, to and under each of the Sale Agreements, the
Assignment Agreements and the Custodial Agreements; (c) such amounts as may be
held from time to time by the Trustee in the Certificate Account, the Basis Risk
Reserve Fund, the Certificate Insurance Account or any other accounts for the
benefit of the Owners of the Certificates, together with all cash, securities,
investments or other assets (including Eligible Investments) credited thereto
including any investment earnings thereon, and such cash, securities,
investments or other assets as may be held in any other Account, including the
Collection Account; and (d) any and all Proceeds of all the foregoing
(including, but not by way of limitation, any amounts relating to the Mortgage
Loans received from the Sellers through the enforcement of the relevant
provisions of the applicable Sale Agreement, all proceeds of any mortgage
insurance, hazard insurance, flood insurance and title insurance policy relating
to the Mortgage Loans, cash proceeds, accounts, accounts receivable, notes,
drafts, acceptances, chattel paper, checks, deposit accounts, rights to payment
of any and every kind, and other forms of obligations and receivables which at
any time constitute all or part of or are included in the proceeds of any of the
foregoing). In addition, the Depositor hereby causes the Certificate Insurer to
deliver to the Trustee the Certificate Insurance Policy for the benefit of the
Class A Certificates (all of the items in clauses (a)-(d) above, together with
the Certificate Insurance Policy, subject to any exclusions or exceptions
specified therein, are collectively referred to herein as the "TRUST ESTATE").
The Trustee acknowledges such sale, accepts the Trust
hereunder in accordance with the provisions hereof and agrees to perform the
duties herein to the end that the interests of the Owners may be adequately and
effectively protected.
REMIC I
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As provided herein, the Trustee will make an election to treat the
segregated pool of assets consisting of the Mortgage Loans and certain other
related assets subject to this Agreement as a real estate mortgage investment
conduit (a "REMIC") for federal income tax purposes, and such segregated pool of
assets will be designated as "REMIC I." The Class R-I Interest will represent
the sole class of "residual interests" in REMIC I for purposes of the REMIC
Provisions (as defined herein) under federal income tax law. The following table
irrevocably sets forth the designation, remittance rate (the "Uncertificated
REMIC I Pass-Through Rate") and initial Uncertificated Principal Balance for
each of the "regular interests" in REMIC I (the "REMIC I Regular Interests").
The "latest possible maturity date" (determined solely for purposes of
satisfying Treasury regulation
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Section 1.860G-1(a)(4)(iii)) for each REMIC I Regular Interest shall be the
360th Distribution Date. None of the REMIC I Regular Interests will be
certificated.
Designation Uncertificated REMIC I Uncertificated Principal Latest Possible Maturity
Pass-through Rate Balance Date
LT-AA Variable(1) $ 252,011,900.00 January 25, 2032
LT-A1 Variable(1) $ 614,210.00 January 25, 2032
LT-A2 Variable(1) $ 549,350.00 January 25, 2032
LT-A3 Variable(1) $ 1,163,560.00 January 25, 2032
LT-M1 Variable(1) $ 45,010.00 January 25, 2032
LT-B1 Variable(1) $ 90,000.00 January 25, 2032
LT-B2 Variable(1) $ 38,570.00 January 25, 2032
LT-B3 Variable(1) $ 45,000.00 January 25, 2032
LT-ZZ Variable(1) $ 2,597,400.00 January 25, ▇▇▇▇
▇▇-▇ Variable(1) $ 100.00 January 25, 2032
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(1) Calculated as provided in the definition of Uncertificated REMIC I
Pass-Through Rate.
REMIC II
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As provided herein, the Trustee will elect to treat the segregated pool
of assets consisting of the REMIC I Regular Interests as a REMIC for federal
income tax purposes, and such segregated pool of assets will be designated as
REMIC II. The Class R-II Interest will represent the sole class of "residual
interests" in REMIC II for purposes of the REMIC Provisions under federal income
tax law. The following table irrevocably sets forth the designation,
Pass-Through Rate, aggregate Initial Certificate Principal Balance, Final
Scheduled Distribution Date and initial ratings for each Class of Certificates
comprising the interests representing "regular interests" in REMIC II. The
"latest possible maturity date" (determined solely for purposes of satisfying
Treasury Regulation Section 1.860G-1(a)(4)(iii)) for each Class of REMIC II
Regular Certificates shall be the 360th Distribution Date.
DESIGNATION PASS-THROUGH RATE AGGREGATE INITIAL FINAL SCHEDULED DISTRIBUTION
CERTIFICATE PRINCIPAL DATE
BALANCE
Class A-1 (1) $ 61,421,000.00 January 25, 2032
Class A-2 (1) $ 54,935,000.00 January 25, 2032
Class A-3 (1) $ 116,356,000.00 January 25, 2032
Class M-1 (1) $ 4,501,000.00 January 25, 2032
Class B-1 (1) $ 9,000,000.00 January 25, 2032
Class B-2 (1) $ 3,857,000.00 January 25, 2032
Class B-3 (1) $ 4,500,000.00 January 25, 2032
Class X (2) $ 2,584,801.00 January 25 ,2032
Class P (3) $ 100.00 January 25 ,2032
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(1) Interest will accrue at a rate equal to the Pass-Through Rate, as
defined herein.
(2) The Class X Certificates will accrue interest as described in the
definition of Pass-Through Rate. The Class X Certificates will not
accrue interest on their Certificate Balance.
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(3) The Class P Certificates will not be entitled to distributions of
interest.
ARTICLE I
DEFINITIONS; RULES OF CONSTRUCTION
1.01 DEFINITIONS.
For all purposes of this Agreement, the following terms shall
have the meanings set forth below, unless the context clearly indicates
otherwise:
"ACCEPTED SERVICING PRACTICES": Shall mean (i) with respect to
the Mortgage Loans (other than the Contracts), procedures (including collection
procedures) that require the same care that Fairbanks or Wilshire, as
applicable, customarily has employed and exercised in servicing and
administering mortgage loans or owned, post-foreclosure real estate, as
applicable, for its own account and, in general, in accordance with the
principles described in the ▇▇▇▇▇▇ ▇▇▇ Guidelines and the ▇▇▇▇▇▇▇ Mac Guidelines
and accepted mortgage servicing practices of prudent lending institutions, and
shall include compliance with all applicable Law and (ii) with respect to the
Contracts, the servicing standard set forth in the GreenPoint Servicing
Agreement.
"ACCOUNT": The Certificate Account, Escrow Account,
Certificate Insurance Account, or Collection Account (including any sub-accounts
of any of the foregoing), established and held in trust by the Servicers or the
Trustee for the benefit of the Certificateholders and the Certificate Insurer.
The obligation to establish and maintain the Accounts is not delegable.
"ACCRUAL PERIOD": With respect to any Distribution Date and
the Offered Certificates, the period from and including the immediately
preceding Distribution Date (or, in the case of the first Distribution Date, the
Closing Date) to, but excluding such Distribution Date.
"ACCRUED CERTIFICATE INTEREST": For any Distribution Date and
any Class of REMIC I Regular Interests and the Class X Certificates, the product
of the Certificate Balance as of the close of the preceding Distribution Date
and the applicable Pass-Through Rate of such Class of Certificates, calculated
using a 30/360 Day Count Fraction. For any Distribution Date and any Class of
Certificates, other than the Class X Certificates, the product of the
Certificate Balance as of the close of the preceding Distribution Date and the
applicable Pass-Through Rate of such Class of Certificates, calculated using an
Actual/360 Day Count Fraction. Accrued Certificate Interest for any Distribution
Date shall be reduced by an amount equal to the portion allocable to any Class
of Certificates, if any, of the sum of (i) the aggregate of Compensating
Interest Shortfalls and (ii) Relief Act Shortfalls, if any, for such
Distribution Date.
"ACTUAL PRINCIPAL BALANCE": With respect to any Mortgage Loan
as of any date, its original principal balance, reduced by the principal portion
of all payments that
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have been made on or before such date, and Realized Losses of principal on such
Mortgage Loan realized prior to such date. The Actual Principal Balance of a
liquidated Mortgage Loan will equal zero.
"ACTUARIAL CONTRACT": Any Contract, other than a Simple
Interest Contract, on which 30 days of interest is owed irrespective of the day
on which payment is received.
"ADJUSTABLE RATE MORTGAGE LOAN": Each of the Mortgage Loans
identified in the Schedule of Mortgage Loans as having a Mortgage Rate that is
subject to adjustment.
"ADJUSTMENT DATE": With respect to each Adjustable Rate
Mortgage Loan, the first day of the month in which the Mortgage Rate of an
Adjustable Rate Mortgage Loan changes pursuant to the related Mortgage Note. The
first Adjustment Date following the Cut-off Date as to each Adjustable Rate
Mortgage Loan is set forth in the Schedule of Mortgage Loans.
"ADJUSTED WAC RATE": With respect to any Distribution Date,
the weighted average of the Net Rates of the Mortgage Loans, calculated based on
the Stated Principal Balances thereof as of the beginning of the related
Collection Period for each Mortgage Loan and multiplied by a fraction having as
its numerator 30 days and as its denominator, the actual number of days in the
Collection Period.
"ADMINISTRATIVE COST RATE": Shall mean (i) with respect to
each Mortgage Loan, 0.5025% per annum and (ii) with respect to each Contract,
1.0025%, in each case calculated on the basis of the same number of days as the
number of days for which interest accrues during a Due Period for such Mortgage
Loan or Contract, as applicable.
"ADVANCE": A Monthly Advance or a Servicing Advance.
"ADVANCE RATE": The prime rate shown as such in the Wall
Street Journal plus 2.00% per annum.
"AFFILIATE": When used with reference to a specified Person,
any Person that (i) directly or indirectly controls or is controlled by or is
under common control with the specified Person, (ii) is an officer of, partner
in or trustee of, or serves in a similar capacity with respect to, the specified
Person or of which the specified Person is an officer, partner or trustee, or
with respect to which the specified Person serves in a similar capacity, or
(iii) directly or indirectly is the beneficial owner of 10% or more of any class
of equity securities of the specified Person or of which the specified Person is
directly or indirectly the owner of 10% or more of any class of equity
securities.
"AGREEMENT": This Trust and Servicing Agreement, as it may be
amended from time to time, including the Exhibits and Schedules hereto.
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"APPLIED REALIZED LOSS AMOUNT": For any Distribution Date,
after taking into account all Realized Losses experienced on the Mortgage Loans
during the preceding Collection Period and after taking into account the
distribution of the Principal Distribution Amounts to the Certificates, the
amount applied to reduce the Certificate Balance or, in the case of the Class X
Certificates, the amount currently distributable to, the Class X Certificates.
"APPRAISAL": With respect to any Mortgage Loan, the appraisal
conducted by a licensed appraiser or another valuation method commonly used by
prudent lenders.
"APPRAISED VALUE": With respect to any Mortgage Loan, the
value of the related Mortgaged Property based upon the value estimated by the
Appraisal or the sales price of the Mortgaged Property at such time of
origination or, in the case of a refinanced Mortgage Loan, the value of the
related Mortgaged Property based upon the value estimated by the Appraisal used
or obtained at the time of refinancing, as applicable.
"ASSIGNMENT": With respect to each Mortgage Loan, the
assignment of mortgage from the applicable Seller or any other prior owner of
the Mortgage Loan to the Trustee.
"ASSIGNMENT AGREEMENTS": Shall mean (i) the Assignment,
Assumption and Recognition Agreement, dated as of January 29, 2003, among
▇▇▇▇▇▇▇ ▇▇▇▇▇ Mortgage Company, the Depositor and ▇▇▇▇▇ Fargo and (ii) the
Assignment, Assumption and Recognition Agreement, dated as of January 29, 2003,
among ▇▇▇▇▇▇▇ ▇▇▇▇▇ Mortgage Company, the Depositor and Household.
"AUTHORIZED OFFICER": With respect to any Person, any officer
of such Person who is authorized to act for such Person in matters relating to
this Agreement, and whose action is binding upon such Person, which with respect
to the Depositor and each of the Servicers, initially includes those individuals
whose names appear on the lists of Authorized Officers delivered at the Closing;
and, with respect to the Trustee, any officer assigned to the Institutional
Trust Services/Structured Finance Services Group (or any successor thereto),
including any Vice President, Assistant Vice President, Trust Officer or any
Officer of the Trustee customarily performing functions similar to those
performed by any of the above designated officers, and in each case having
direct responsibility for the administration of this Agreement.
"AVAILABLE DISTRIBUTION AMOUNT": With respect to any
Distribution Date, (x) (i) the sum of all amounts relating to the Mortgage Loans
received by Fairbanks and Wilshire (including the Loan Purchase Price paid by
the related Seller to the related Servicer in connection with the repurchase of
any Mortgage Loan as described in Section 3.03(b) hereof or paid by the Majority
Class X Certificateholder pursuant to Section 3.03(b) or 8.21 of this Agreement
and excluding any amounts withdrawn by Fairbanks and Wilshire pursuant to
SECTION 8.04(D) as of the related Determination Date), and (ii) the amount of
any Monthly Advances and Compensating Interest payments remitted by Fairbanks
and Wilshire with respect to the related Mortgage Loans for such Distribution
Date; (y) in the case of GreenPoint, the amount remitted to Wilshire as set
forth in the
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definition of "Remittance Amount" in Section 1.01 of the GreenPoint Servicing
Agreement; and (z) the amount of any Monthly Advances and Compensating Interest
payments remitted by the Master Servicer with respect to the Contracts pursuant
to Sections 9.02 and 9.03 hereof.
"BANKRUPTCY CODE": The United States Bankruptcy Code, 11
U.S.C.ss.101, et seq., as amended.
"BASIC PRINCIPAL DISTRIBUTION AMOUNT": With respect to any
Distribution Date, the excess of (i) the Principal Remittance Amount over (ii)
the Excess Subordinated Amount, if any, for such Distribution Date.
"BASIS RISK CARRY FORWARD AMOUNT": With respect to each Class
of Offered Certificates, as of any Distribution Date, the sum of (A) if on such
Distribution Date the Pass-Through Rate for any Class of Offered Certificates is
based upon the WAC Cap, the excess of (i) the amount of interest such Class of
Offered Certificates would otherwise be entitled to receive on such Distribution
Date had such rate been calculated at the Pass-Through Rate (without regard to
the WAC Cap) for such Distribution Date, over (ii) the amount of interest
payable on such Class of Offered Certificates at the WAC Cap, (B) the Basis Risk
Carry Forward Amount for such Class of Certificates for all previous
Distribution Dates not previously paid and (C) interest on the amount described
in clause (B) at the applicable Pass-Through Rate for such Class of Offered
Certificates for such Distribution Date (without regard to the WAC Cap).
"BASIS RISK RESERVE FUND": The account established pursuant to
SECTION 7.10 hereof.
"BOOK-ENTRY CERTIFICATE": The Class A Certificates, the Class
M-1 Certificates and the Class B Certificates for so long as the Certificates of
such Class shall be registered in the name of the Depository or its nominee.
"BUSINESS DAY": Any day other than a Saturday, Sunday or a day
on which banking institutions in New York, New York, Salt Lake City, Utah or
Portland, Oregon or the city in which the Corporate Trust Office is located are
authorized or obligated by law or executive order to close.
"CERTIFICATE ACCOUNT": The certificate account established in
accordance with SECTION 7.01 and maintained either (i) in the corporate trust
department of the Trustee, which funds are uninvested, or (ii) in an Eligible
Account subject to a securities account control agreement; PROVIDED that the
funds in such account shall not be commingled with other funds held by the
Trustee. As an alternative to the foregoing, the Trustee may maintain the
Certificate Account as a deposit account if the rights of the Trustee in such
deposit account are perfected pursuant to sections 9-104, 9-304, and 9-314 of
the UCC.
"CERTIFICATE BALANCE": As of any date of determination with
respect to any Offered Certificate, Class P Certificate or Regular Interest
(other the Class X Regular
7
Interest and the Class X Certificates), (A) the initial Certificate Balance
thereof minus (B) all amounts previously distributed as principal thereon, minus
(C) all Applied Realized Loss Amounts previously applied to reduce the
Certificate Balance thereof. The Class R Certificates have no Certificate
Balance. The Class X Certificate Balance shall be equal to the excess, if any,
of (A) the aggregate Uncertificated Principal Balance of the REMIC I Regular
Interests over (B) the then aggregate Certificate Balance of the Offered
Certificates and the Class P Certificates
"CERTIFICATE INSURANCE ACCOUNT": As defined in SECTION
7.03(B).
"CERTIFICATE INSURANCE AGREEMENT": The Insurance and Indemnity
Agreement, dated as of January 29, 2003, among the Certificate Insurer, the
Trustee, the Servicers and the Depositor.
"CERTIFICATE INSURANCE POLICY": The Certificate Guaranty
Insurance Policy No. AB0643BE and all endorsements thereto, dated the Closing
Date, issued by the Certificate Insurer to the Trustee for the benefit of the
Holders of the Class A Certificates attached hereto as Exhibit B.
"CERTIFICATE INSURER": Ambac Assurance Corporation or its
successor in interest.
"CERTIFICATE INSURER DEFAULT": The existence and continuance
of any of the following: (a) a failure by the Certificate Insurer to make a
payment required under the Certificate Insurance Policy in accordance with its
terms; or (b)(i) the Certificate Insurer (A) files any petition or commences any
case or proceeding under any provision or chapter of the Bankruptcy Code or any
other similar federal or state law relating to insolvency, bankruptcy,
rehabilitation, liquidation or reorganization, (B) makes a general assignment
for the benefit of its creditors, or (C) has an order for relief entered against
it under the Bankruptcy Code or any other similar federal or state law relating
to insolvency, bankruptcy, rehabilitation, liquidation or reorganization which
is final and nonappealable; or (ii) a court of competent jurisdiction, the New
York insurance department or other competent regulatory authority enters a final
and nonappealable order, judgment or decree (A) appointing a custodian, trustee,
agent or receiver for the Certificate Insurer or for all or any material portion
of its property or (B) authorizing the taking of possession by a custodian,
trustee, agent or receiver of the Certificate Insurer (or the taking of
possession of all or any material portion of the property of the Certificate
Insurer).
"CERTIFICATE INSURER PREMIUM": The premium payable monthly to
the Certificate Insurer on each Distribution Date pursuant to the Certificate
Insurance Policy.
"CERTIFICATE INSURER PREMIUM PERCENTAGE": 0.18% per annum.
"CERTIFICATEHOLDER" or "HOLDER": Each Person in whose name a
Certificate is registered in the Register, except that, solely for the purposes
of giving any consent, waiver, request or demand pursuant to this Agreement, any
Certificate registered in the
8
name of a Servicer, any Subservicer or any Depositor, or any affiliate of any of
them, shall be deemed not to be outstanding (except that in determining whether
the Trustee shall be protected in relying upon any such consent, waiver, request
or demand, only Certificates that an Authorized Officer actually knows to be so
owned shall be disregarded) and the undivided Percentage Interest evidenced
thereby shall not be taken into account in determining whether the requisite
percentage of Certificates necessary to effect any such consent, waiver, request
or demand has been obtained. When used with respect to any Class of
Certificates, a Certificateholder or Holder of such Class of Certificates, as
the case may be.
"CERTIFICATES": The Offered Certificates and the Private
Certificates.
"CERTIFICATION": As defined in SECTION 3.05.
"CHAPTER 13 LOAN": A Mortgage Loan the Mortgagor under which
in bankruptcy under a plan promulgated under Chapter 13 of the Bankruptcy Code.
"CIVIL RELIEF ACT": The Soldiers' and Sailors' Civil Relief
Act of 1940, as amended or applicable similar state or local laws.
"CLASS": Any class of Certificates.
"CLASS A CERTIFICATE": Any one of the Certificates designated
hereunder as Class A-1, Class A-2 or Class A-3 Certificates.
"CLASS A-1 CERTIFICATE": Any one of the Certificates
designated as a Class A-1 Certificate hereunder and substantially in the form
annexed hereto as EXHIBIT A-1, authenticated and delivered by the Trustee,
representing the right to distributions as set forth herein.
"CLASS A-2 CERTIFICATE": Any one of the Certificates
designated as a Class A-2 Certificate hereunder and substantially in the form
annexed hereto as EXHIBIT A-1, authenticated and delivered by the Trustee,
representing the right to distributions as set forth herein.
"CLASS A-3 CERTIFICATE": Any one of the Certificates
designated as a Class A-3 Certificate hereunder and substantially in the form
annexed hereto as EXHIBIT A-1, authenticated and delivered by the Trustee,
representing the right to distributions as set forth herein.
"CLASS A DEFICIENCY AMOUNT": With respect to any Distribution
Date and any Class of Class A Certificates, any amount equal to the excess, if
any, of (i) the Certificate Balance of the Class A Certificates after giving
effect to the distribution of principal to be made on such Distribution Date,
over (ii) the Pool Balance as of such Distribution Date.
9
"CLASS A PRINCIPAL DISTRIBUTION AMOUNT": With respect to any
Distribution Date on or after the Stepdown Date and on which a Trigger Event is
not in effect, the excess of (x) the aggregate Certificate Balance of the Class
A Certificates immediately prior to such Distribution Date over (y) the lesser
of (A) the product of (i) 81.00% and (ii) the aggregate Stated Principal Balance
of the Mortgage Loans as of the last day of the related Due Period (after giving
effect to scheduled payments of principal due during the related Due Period, to
the extent received or advanced and unscheduled collections of principal
received during the related Collection Period) and (B) the aggregate Stated
Principal Balance of the Mortgage Loans as of the last day of the related Due
Period (after giving effect to scheduled payments of principal due during the
related Due Period, to the extent received or advanced and unscheduled
collections of principal received during the related Collection Period) minus
$1,285,775.
"CLASS B CERTIFICATE": Any one of the Certificates designated
hereunder as Class B-1, Class B-2 or Class B-3 Certificates.
"CLASS B-1 CERTIFICATE": Any one of the Certificates
designated as a Class B-1 Certificate hereunder and substantially in the form
annexed hereto as EXHIBIT A-1, authenticated and delivered by the Trustee,
representing the right to distributions as set forth herein.
"CLASS B-1 PRINCIPAL DISTRIBUTION AMOUNT": With respect to any
Distribution Date on or after the Stepdown Date and on which a Trigger Event is
not in effect, the excess of (x) the sum of (i) the aggregate Certificate
Balance of the Class A Certificates (after taking into account the payment of
the Class A Principal Distribution Amount on such Distribution Date), (ii) the
Certificate Balance of the Class M-1 Certificates (after taking into account the
payment of the Class M-1 Principal Distribution Amount on such Distribution
Date) and (iii) the Certificate Balance of the Class B-1 Certificates
immediately prior to such Distribution Date over (y) the lesser of (A) the
product of (i) 91.50% and (ii) the aggregate Stated Principal Balance of the
Mortgage Loans as of the last day of the related Due Period (after giving effect
to scheduled payments of principal due during the related Due Period, to the
extent received or advanced and unscheduled collections of principal received
during the related Collection Period) and (B) the aggregate Stated Principal
Balance of the Mortgage Loans as of the last day of the related Due Period
(after giving effect to scheduled payments of principal due during the related
Due Period, to the extent received or advanced and unscheduled collections of
principal received during the related Collection Period) minus $1,285,775.
"CLASS B-2 CERTIFICATE": Any one of the Certificates
designated as a Class B-2 Certificate hereunder and substantially in the form
annexed hereto as EXHIBIT A-1, authenticated and delivered by the Trustee,
representing the right to distributions as set forth herein.
"CLASS B-2 PRINCIPAL DISTRIBUTION AMOUNT": With respect to any
Distribution Date on or after the Stepdown Date and on which a Trigger Event is
not in effect, the excess of (x) the sum of (i) the aggregate Certificate
Balance of the Class A
10
Certificates (after taking into account the payment of the Class A Principal
Distribution Amount on such Distribution Date), (ii) the Certificate Balance of
the Class M-1 Certificates (after taking into account the payment of the Class
M-1 Principal Distribution Amount on such Distribution Date), (iii) the
Certificate Balance of the Class B-1 Certificates (after taking into account the
payment of the Class B-1 Principal Distribution Amount on such Distribution
Date) and (iv) the Certificate Principal Balance of the Class B-2 Certificates
immediately prior to such Distribution Date over (y) the lesser of (A) the
product of (i) 94.50% and (ii) the aggregate Stated Principal Balance of the
Mortgage Loans as of the last day of the related Due Period (after giving effect
to scheduled payments of principal due during the related Due Period, to the
extent received or advanced and unscheduled collections of principal received
during the related Collection Period) and (B) the aggregate Stated Principal
Balance of the Mortgage Loans as of the last day of the related Due Period
(after giving effect to scheduled payments of principal due during the related
Due Period, to the extent received or advanced and unscheduled collections of
principal received during the related Collection Period) minus $1,285,775.
"CLASS B-3 CERTIFICATE": Any one of the Certificates
designated as a Class B-3 Certificate hereunder and substantially in the form
annexed hereto as EXHIBIT A-1, authenticated and delivered by the Trustee,
representing the right to distributions as set forth herein.
"CLASS B-3 PRINCIPAL DISTRIBUTION AMOUNT": With respect to any
Distribution Date on or after the Stepdown Date and on which a Trigger Event is
not in effect, the excess of (x) the sum of (i) the aggregate Certificate
Balance of the Class A Certificates (after taking into account the payment of
the Class A Principal Distribution Amount on such Distribution Date), (ii) the
Certificate Balance of the Class M-1 Certificates (after taking into account the
payment of the Class M-1 Principal Distribution Amount on such Distribution
Date), (iii) the Certificate Balance of the Class B-1 Certificates (after taking
into account the payment of the Class B-1 Principal Distribution Amount on such
Distribution Date), (iv) the Certificate Balance of the Class B-2 Certificates
(after taking into account the payment of the Class B-2 Principal Distribution
Amount on such Distribution Date) and (v) the Certificate Principal Balance of
the Class B-3 Certificates immediately prior to such Distribution Date over (y)
the lesser of (A) the product of (i) 98.00% and (ii) the aggregate Stated
Principal Balance of the Mortgage Loans as of the last day of the related Due
Period (after giving effect to scheduled payments of principal due during the
related Due Period, to the extent received or advanced and unscheduled
collections of principal received during the related Collection Period) and (B)
the aggregate Stated Principal Balance of the Mortgage Loans as of the last day
of the related Due Period (after giving effect to scheduled payments of
principal due during the related Due Period, to the extent received or advanced
and unscheduled collections of principal received during the related Collection
Period) minus $1,285,775.
"CLASS M-1 CERTIFICATE": Any one of the Certificates
designated as a Class M-1 Certificate hereunder and substantially in the form
annexed hereto as EXHIBIT A-1, authenticated and delivered by the Trustee,
representing the right to distributions as set forth herein.
11
"CLASS M-1 PRINCIPAL DISTRIBUTION AMOUNT": With respect to any
Distribution Date on or after the Stepdown Date and on which a Trigger Event is
not in effect, the excess of (x) the sum of (i) the aggregate Certificate
Principal Balance of the Class A Certificates (after taking into account the
payment of the Class A Principal Distribution Amount on such Distribution Date)
and (ii) the Certificate Principal Balance of the Class M-1 Certificates
immediately prior to such Distribution Date over (y) the lesser of (A) the
product of (i) 84.50% and (ii) the aggregate Stated Principal Balance of the
Mortgage Loans as of the last day of the related Due Period (after giving effect
to scheduled payments of principal due during the related Due Period, to the
extent received or advanced and unscheduled collections of principal received
during the related Collection Period) and (B) the aggregate Stated Principal
Balance of the Mortgage Loans as of the last day of the related Due Period
(after giving effect to scheduled payments of principal due during the related
Due Period, to the extent received or advanced and unscheduled collections of
principal received during the related Collection Period) minus $1,285,775.
"CLASS P CERTIFICATE": Any one of the Certificates designated
as a Class P Certificate hereunder and substantially in the form annexed hereto
as EXHIBIT A-3, authenticated and delivered by the Trustee, representing the
right to distributions as set forth herein.
"CLASS R CERTIFICATE": Any one of the Certificates designated
as a Class R Certificate hereunder and substantially in the form annexed hereto
as EXHIBIT A-4, authenticated and delivered by the Trustee, evidencing the Class
R-I Interest and the Class R-II Interest and representing the right to
distributions as set forth herein.
"CLASS R-I INTEREST": The uncertificated residual interest in
REMIC I.
"CLASS R-II INTEREST": The uncertificated residual interest in
REMIC II.
"CLASS X CERTIFICATE": Any one of the Certificates designated
as a Class X Certificate hereunder and substantially in the form annexed hereto
as EXHIBIT A-2, authenticated and delivered by the Trustee and representing the
right to distributions as set forth herein.
"CLASS X DISTRIBUTION AMOUNT": Shall mean the amount to be
distributed to the Class X Certificates pursuant to SECTION 7.06(B)(VIII).
"CLEAN-UP CALL DATE": The first Distribution Date immediately
following the date on which the Pool Balance has declined to an amount equal to
or less than 10% of the Original Pool Balance.
"CLOSING": As defined in SECTION 4.02.
"CLOSING DATE": January 29, 2003.
12
"CODE": The Internal Revenue Code of 1986, as amended,
together with any regulations promulgated thereunder and in effect from time to
time.
"COMMISSION": The Securities and Exchange Commission.
"COLLECTION ACCOUNT": Each of the Accounts created by
Fairbanks and Wilshire pursuant to SECTION 8.04 hereto and created by GreenPoint
pursuant to Section 3.05 of the GreenPoint Servicing Agreement.
"COLLECTION PERIOD": For any Distribution Date, the period
beginning on and including the second day of the preceding calendar month and
ending at the close of business on the first day of the current calendar month.
"COLLECTIONS": All cash collections and other cash proceeds of
a Mortgage Loan received by a Servicer, any Subservicer, or any other Person,
including all payments made by the related Mortgagor and all cash proceeds of
the Related Security.
"COMPENSATING INTEREST": With respect to the related Servicer
the obligation set forth in SECTION 8.06 and with respect to the Master Servicer
the obligation set forth in SECTION 9.03 hereof.
"COMPENSATING INTEREST SHORTFALL": For any Distribution Date,
the amount by which Compensating Interest is greater than (i) the Servicing Fee
otherwise available for payment to Fairbanks on such Distribution Date or (ii)
one-half of the Servicing Fee otherwise available for payment to Wilshire on
such Distribution Date.
"CONTRACTS": As defined in the third WHEREAS clause of this
Agreement which shall include Actuarial Contracts and Simple Interest Contracts.
"CONTRACT FILE": As to each Contract other than a Land Home
Contract, (a) the original copy of the Contract, (b) the original title document
issued to the originator as secured lender or agent therefor for the related
Manufactured Home, unless the laws of the jurisdiction in which the related
Manufactured Home is located do not provide for the issuance of any title
documents for manufactured housing to secured lenders, (c) evidence of one or
more of the following types of perfection of the security interest in favor of
the originator as secured lender or agent therefor in the related Manufactured
Home granted by such Contract, as appropriate: (1) notation of such security
interest on the title document, (2) a financing statement meeting the
requirements of the UCC, with evidence of filing in the appropriate offices
indicated thereon, or (3) such other evidence of perfection of a security
interest in a manufactured housing unit as is customary in such jurisdiction,
(d) the assignment of the Contract from the manufactured housing dealer to the
originator, if any, including any intervening assignments, and (e) any
extension, modification or waiver agreement(s).
"CONVENTIONAL MORTGAGE LOAN": Any Mortgage Loan, other than a
Simple Interest Mortgage Loan, on which 30 days of interest is owed irrespective
of the day in which payment is received.
13
"CORPORATE TRUST OFFICE": The principal office of the Trustee
at ▇ ▇▇▇ ▇▇▇▇ ▇▇▇▇▇, ▇▇▇ ▇▇▇▇▇, ▇▇▇ ▇▇▇▇, ▇▇ ▇▇▇▇▇, Attention: Institutional
Trust Services/Structured Finance Services, GSRPM Mortgage Pass-Through
Certificates, 2003-1, or at such other addresses as the Trustee may designate
from time to time by notice to the Certificateholders, the Depositor, Fairbanks
and Wilshire.
"CORRESPONDING CERTIFICATE": With respect to each REMIC I
Regular Interest set forth below, the Regular Certificate set forth in the table
below:
REMIC I REGULAR INTEREST REMIC II REGULAR CERTIFICATE
------------------------ ----------------------------
LT-A1 Class ▇-▇
▇▇-▇▇ Class ▇-▇
▇▇-▇▇ Class A-3
LT-M1 Class M-1
LT-B1 Class B-1
LT-B2 Class B-2
LT-B3 Class B-3
LT-P Class P
"CREDIT ENHANCEMENT PERCENTAGE": For any Distribution Date,
the percentage obtained by dividing (i) the sum of (a) the aggregate Certificate
Balance of the Subordinate Certificates and (b) the Overcollateralization Amount
by (ii) the aggregate Stated Principal Balance of the Mortgage Loans, calculated
after taking into account distributions of principal on the Mortgage Loans and
distribution of the Principal Distribution Amount to the Certificates then
entitled to distributions of principal on such Distribution Date.
"CUMULATIVE REALIZED LOSSES": As of any date of determination,
the aggregate amount of Realized Losses on the Mortgage Loans since the Cut-off
Date.
"CURTAILMENT": Any payment of principal received during a
Collection Period as part of a payment that is not intended to satisfy the
Mortgage Loan in full, and which is neither intended as a Prepaid Installment
nor is intended to cure a delinquency.
"CUSTODIAL AGREEMENT": Each of the Fairbanks Custodial
Agreement, the Wilshire Custodial Agreement and the GreenPoint Custodial
Agreement.
"CUSTODIAL FILE": The documents described in SECTION 3.04(B)
AND (C).
"CUSTODIAN": JPMorgan Chase Bank, in its capacity as custodian
under each of the Custodial Agreements.
"CUT-OFF DATE": As of January 1, 2003.
"DAY COUNT FRACTION": The assumption used to calculate the
number of days for which interest accrues during an Accrual Period, which may
be, as specified herein (x) 30/360 (assuming that a year consists of 12 months
of 30 days each) or (y)
14
actual/360 (assuming the actual number of days in an Accrual Period, including
days that are not Business Days, and a year of 360 days).
"DEED IN LIEU": Any Servicer's acceptance of a deed in lieu of
foreclosure.
"DEFAULTED MORTGAGE LOAN": A Mortgage Loan that is a 90-Day
Delinquent Loan.
"DEFICIENCY": The difference between the sum of all amounts
due under a Mortgage Loan and the Net Liquidation Proceeds realized on such
Mortgage Loan.
"DEFICIENT VALUATION": A valuation by a court of competent
jurisdiction of the Mortgaged Property in an amount less than the then
outstanding indebtedness under the Mortgage Loan, which valuation results from a
proceeding initiated under the Bankruptcy Code.
"DEFINITIVE CERTIFICATE": As defined in SECTION 5.02(E).
"DELINQUENT": Any Mortgage Loan as to which the scheduled
monthly payment of principal and interest payable by the Mortgagor under a
Mortgage Note due on a Due Date is not paid by the close of business on the next
scheduled Due Date for such Mortgage Loan (I.E., a Mortgage Loan for which the
Mortgagor failed to make such payment due on January 1, 2003 will be reported as
"30 DAYS DELINQUENT" on February 2, 2003, if such Mortgagor failed to make such
payment by the close of business on February 1, 2003). The terms "60 DAYS
Delinquent," "90 DAYS DELINQUENT" and the like have meanings correlative to the
foregoing with respect to the applicable number of months succeeding the most
recent payment.
"DEPOSITOR": GS Mortgage Securities Corp., or any successor
thereto.
"DEPOSITORY": The Depository Trust Company, or any successor
Depository hereafter named. The nominee of the initial Depository, for purposes
of registering those Certificates that are to be Book-Entry Certificates, is
CEDE & Co. The Depository shall at all times be a "clearing corporation" as
defined in Section 8-102(3) of the Uniform Commercial Code of the State of New
York and a "clearing agency" registered pursuant to the provisions of Section
17A of the Securities Exchange Act of 1934, as amended.
"DEPOSITORY INSTITUTION": Any depository institution or trust
company, including the Trustee, that (a) is incorporated under the laws of the
United States of America or any State thereof, (b) is subject to supervision and
examination by federal or state banking authorities and (c) has outstanding
unsecured commercial paper or other short-term unsecured debt obligations that
are rated P-1 by Moody's, F1+ by Fitch and A-1+ by Standard & Poor's.
15
"DETERMINATION DATE": With respect to each Distribution Date,
the 15th day of the calendar month in which such Distribution Date occurs or, if
such day is not a Business Day, the immediately following Business Day.
"DIRECT PARTICIPANT": Any broker-dealer, bank or other
financial institution or other Person for whom from time to time the Depository
effects book entry transfers and pledges of securities deposited with the
Depository.
"DISQUALIFIED ORGANIZATION": Any of the following: (i) the
United States, any State or political subdivision thereof, any possession of the
United States, or any agency or instrumentality of any of the foregoing (other
than an instrumentality which is a corporation if all of its activities are
subject to tax and, except for ▇▇▇▇▇▇▇ Mac, a majority of its board of directors
is not selected by such governmental unit), (ii) any foreign government, any
international organization, or any agency or instrumentality of any of the
foregoing, (iii) any organization (other than certain farmers' cooperatives
described in Section 521 of the Code) which is exempt from the tax imposed by
Chapter 1 of the Code (including the tax imposed by Section 511 of the Code on
unrelated business taxable income), (iv) rural electric and telephone
cooperatives described in Section 1381(a)(2)(C) of the Code, (v) an "electing
large partnership" and (vi) any other Person so designated by the Trustee based
upon an Opinion of Counsel that the holding of an Ownership Interest in a
Residual Certificate by such Person may cause any Trust REMIC or any Person
having an Ownership Interest in any Class of Certificates (other than such
Person) to incur a liability for any federal tax imposed under the Code that
would not otherwise be imposed but for the Transfer of an Ownership Interest in
a Residual Certificate to such Person. The terms "United States," "State" and
"international organization" shall have the meanings set forth in Section 7701
of the Code or successor provisions.
"DISTRIBUTION DATE": Any date on which the Trustee is required
to make distributions to the Owners, which shall be the 25th day of each month
or if such day is not a Business Day, the next Business Day thereafter,
commencing in the month following the Closing Date.
"DUE DATE": For any Mortgage Loan, the date in each month on
which the Monthly Payment is due.
"DUE PERIOD": For each Mortgage Loan, the period commencing on
the prior Due Date and ending on and excluding the Due Date in the current
month, and during which interest accrues on such Mortgage Loan.
"ELIGIBLE ACCOUNT": Either (i) an account maintained with a
federal or state chartered depository institution or trust company the
short-term unsecured debt obligations of which (or, in the case of a depository
institution or trust company that is a subsidiary of a holding company, the
short-term unsecured debt obligations of such holding company) are rated "A-1+"
by Standard & Poor's and "P-1" by Moody's (and a comparable rating if another
Rating Agency is specified by the Depositor by written notice to the Servicer)
at the time any amounts are held on deposit therein, (ii) a trust
16
account or accounts maintained with a federal or state chartered depository
institution or trust company which is subject to regulations regarding fiduciary
funds on deposit therein substantially similar to 12 CFR ss. 9.10(b), and which,
in either case, has corporate trust powers and has a combined capital and
surplus of at least $50,000,000 and is subject to supervision or examination by
federal or state authority, acting in its fiduciary capacity or (iii) any other
account acceptable to each Rating Agency and the Certificate Insurer; provided,
however, that any account established under this Agreement shall qualify as a
Eligible Account under clause (i) above if the funds on deposit therein are held
less than 30 days and the short-term unsecured debt obligations of the federal
or state chartered depository institution or trust company holding such account
are rated "A-1" by Standard & Poor's and "P-1" by Moody's. Eligible Accounts may
bear interest, and may include, if otherwise qualified under this definition,
accounts maintained with the Trustee.
"ELIGIBLE INVESTMENTS": The meaning defined in SECTION 7.05.
"ERISA": The Employee Retirement Income Security Act of 1974,
as amended.
"ERISA RESTRICTED CERTIFICATE": Shall mean the Class M-1
Certificates, Class B Certificates and the Private Certificates.
"ERISA-QUALIFYING UNDERWRITING": A best efforts or firm
commitment underwriting or private placement that meets the requirements of
Prohibited Transaction Exemption ("PTE") 2002-41, 67 Fed. Reg. 54487 (2002) (or
any successor thereto), or any substantially similar administrative exemption
granted by the U.S. Department of Labor.
"ESCROW ACCOUNT": The separate trust account or accounts
created and maintained pursuant to SECTION 8.07.
"ESCROW PAYMENTS": The amounts constituting ground rents,
taxes, assessments, water rates, mortgage insurance premiums, fire, hazard and
flood insurance premiums and other payments required to be escrowed by the
Mortgagor with the mortgagee pursuant to any Mortgage Loan.
"EVENT OF DEFAULT": Any "with cause" event as set forth in
SECTION 8.17(B).
"EXCESS SUBORDINATED AMOUNT": For any Distribution Date is the
excess, if any, of (i) the Overcollateralization Amount over (ii) the Required
Overcollateralization Amount.
"EXCHANGE ACT": The Securities and Exchange Act of 1934, as
amended.
"EXTRA PRINCIPAL DISTRIBUTION AMOUNT": For any Distribution
Date will be the lesser of (i) the Net Monthly Excess Cashflow for such
Distribution Date and (ii) the Overcollateralization Deficiency Amount.
17
"FAIRBANKS CUSTODIAL AGREEMENT": The Custody Agreement dated
as of January 29, 2003 among the Trust, Fairbanks and the Custodian.
"FAIRBANKS MORTGAGE LOANS": The Mortgage Loans included in
Schedule I that are serviced by Fairbanks pursuant to this Agreement.
"FAIRBANKS TERMINATION TRIGGER EVENT": A Fairbanks Termination
Trigger Event shall occur if on any date of determination (i) the Three-Month
Rolling Average Sixty-Day Delinquency Rate of the Fairbanks Mortgage Loans
exceeds 50% of the aggregate Stated Principal Balance of the Fairbanks Mortgage
Loans or (ii) the quotient (expressed as a percentage) of (x) the aggregate
amount of Realized Losses incurred on the Fairbanks Mortgage Loans since the
Cut-off Date through the last day of the related Collection Period divided by
(y) the aggregate Stated Principal Balance of the Fairbanks Mortgage Loans as of
the Cut-off Date, exceeds the applicable percentages set forth below with
respect to such Distribution Date:
DISTRIBUTION DATE OCCURRING IN LOSS PERCENTAGE
------------------------------ ---------------
February 2006 through January 2007 5.75% for the first month, plus an additional
1/12th of 2.50% for each month thereafter, to
8.25%
February 2007 through January 2008 8.25% for the first month, plus an additional
1/12th of 1.25% for each month thereafter, to
9.50%
February 2008 through January 2009 9.50% for the first month, plus an additional
1/12th of 1.25% for each month thereafter, to
10.75%
February 2009 and thereafter 10.75%
"▇▇▇▇▇▇ ▇▇▇": ▇▇▇▇▇▇ ▇▇▇, a federally-chartered and
privately-owned corporation existing under the Federal National Mortgage
Association Charter Act, as amended, or any successor thereof.
"▇▇▇▇▇▇ MAE GUIDE": ▇▇▇▇▇▇ Mae's Servicing Guide, as the same
may be amended by ▇▇▇▇▇▇ Mae from time to time.
"▇▇▇▇▇▇ ▇▇▇ GUIDELINES": Shall mean the guidelines set forth
by ▇▇▇▇▇▇ Mae in the ▇▇▇▇▇▇ ▇▇▇ Guide.
"FDIC": The Federal Deposit Insurance Corporation, a corporate
instrumentality of the United States, or any successor thereto.
18
"FINAL CERTIFICATION": As defined in SECTION 3.05.
"FINAL DETERMINATION": A final determination by the Internal
Revenue Service or by a court of competent jurisdiction, in either case from
which no appeal is taken within the permitted time for such appeal or, if any
appeal is taken, a final determination of such appeal from which no further
appeal can be taken, to the effect that any REMIC in the Trust does not and will
no longer qualify as a REMIC pursuant to Section 860D of the Code.
"FINAL DISTRIBUTION DATE": The Distribution Date in January
2032.
"FINAL RECOVERY DETERMINATION": A determination by the
relevant Servicer with respect to a defaulted Mortgage Loan (i) in the case of
GreenPoint, in accordance with the GreenPoint Servicing Agreement and (ii) in
the case of the related Servicer, in accordance with the general guidelines set
forth in the ▇▇▇▇▇▇ Mae Guide and the ▇▇▇▇▇▇▇ Mac Guide or in the event the
▇▇▇▇▇▇ Mae Guide and the ▇▇▇▇▇▇▇ Mac Guide conflict, in accordance with the
▇▇▇▇▇▇ Mae Guide, that it has recovered, whether through Trustee's sale,
foreclosure sale, pre-foreclosure sale or otherwise, all amounts it expects to
recover from or on account of such defaulted Mortgage Loan.
"FITCH": Fitch, Inc. doing business as Fitch Ratings or any
successor thereto.
"▇▇▇▇▇▇▇ MAC": Federal Home Loan Mortgage Corporation, or any
successor thereof.
"▇▇▇▇▇▇▇ MAC GUIDE": ▇▇▇▇▇▇▇ Mac's Servicing Guide, as the
same may be amended by ▇▇▇▇▇▇▇ Mac from time to time.
"▇▇▇▇▇▇▇ MAC GUIDELINES": Shall mean the guidelines set forth
by ▇▇▇▇▇▇▇ Mac in the ▇▇▇▇▇▇▇ Mac Guide.
"GREENPOINT": GreenPoint Credit LLC as servicer of the
Contracts pursuant to the GreenPoint Servicing Agreement.
"GREENPOINT CUSTODIAL AGREEMENT": The Custody Agreement dated
as of January 29, 2003 among the Trust, GreenPoint and the Custodian.
"GREENPOINT SERVICING AGREEMENT": The Servicing Agreement,
dated as of January 1, 2003 among the Depositor, the Master Servicer and
GreenPoint.
"GROSS MARGIN": With respect to each Adjustable Rate Mortgage
Loan, the fixed percentage set forth in the related Mortgage Note that is added
to the Index on each Adjustment Date in accordance with the terms of the related
Mortgage Note used to determine the Mortgage Rate for such Adjustable Rate
Mortgage Loan.
"HOEPA": As defined in SECTION 8.02(A).
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"HOUSEHOLD": Household Financial Services Inc., and its
successors.
"HOUSEHOLD MORTGAGE LOANS": Shall mean the Mortgage Loans
purchased under the Household Sale Agreement.
"HOUSEHOLD SALE AGREEMENT": Shall mean the Loan Sale Agreement
dated as of September 6, 2002, between Household and ▇▇▇▇▇▇▇ ▇▇▇▇▇ Mortgage
Company.
"INDEMNITY PROCEEDS": Any amounts collected by the relevant
Servicer, the Trustee or the Depositor pursuant to the provisions of the
applicable Sale Agreement.
"INDEPENDENT": When used with respect to any specified Person,
any such Person who (a) is in fact independent of the Depositor, the Master
Servicer, the applicable Seller, the applicable Servicer and their respective
Affiliates, (b) does not have any direct financial interest in or any material
indirect financial interest in the Depositor, the Master Servicer, the
applicable Seller, the applicable Servicer or any Affiliate thereof, and (c) is
not connected with the Depositor, the Master Servicer, the applicable Seller,
the applicable Servicer or any Affiliate thereof as an officer, employee,
promoter, underwriter, trustee, partner, director or Person performing similar
functions; provided, however, that a Person shall not fail to be Independent of
the Depositor, the Master Servicer, the applicable Seller, the applicable
Servicer or any Affiliate thereof merely because such Person is the beneficial
owner of 1% or less of any class of securities issued by the Depositor, the
Master Servicer, the applicable Seller, the applicable Servicer or any Affiliate
thereof, as the case may be.
"INDEX": As to each Adjustable Rate Mortgage Loan, the index
from time to time in effect for the adjustment of the Mortgage Rate set forth as
such in the related Mortgage Note.
"INITIAL CERTIFICATION": As defined in SECTION 3.05.
"INSURANCE POLICY": Any hazard, flood, title or Primary
Insurance Policy relating to a Mortgage Loan plus any amount remitted under
SECTION 8.08.
"INSURANCE PROCEEDS": Payments received with respect to any
Insurance Policy.
"INSURED AMOUNTS": For any Distribution Date, the sum of (1)
the Accrued Certificate Interest and any Interest Shortfall Carryforward Amount
allocable to the Class A Certificates on such Distribution Date, net of any
Compensating Interest Shortfalls and Relief Act Shortfalls; (2) on any
Distribution Date prior to the Distribution Date in January 2032, the Class A
Deficiency Amount, and (3) on the Distribution Date in January 2032, the
aggregate Certificate Balance of the Class A Certificates outstanding on such
Distribution Date (after giving effect to all distributions to be made thereon
on such Distribution Date other than pursuant to the Certificate Insurance
Policy).
20
"INSURED PAYMENTS": The aggregate amount actually paid by the
Certificate Insurer to the Trustee in respect of (i) Insured Amounts for a
Distribution Date and (ii) Preference Amounts for any given Business Day.
"INTEREST SHORTFALL CARRYFORWARD AMOUNT": As of any
Distribution Date and with respect to any Class of Certificates (other than the
Class P, Class R or Class X Certificates), the sum of (i) the amount, if any, by
which (X) the sum of (a) the Accrued Certificate Interest for such Class for
such Distribution Date plus (b) the Interest Shortfall Carryforward Amount for
such Class as of the immediately preceding Distribution Date exceeds (Y) the
amount paid to the Certificateholders of such Class on such Distribution Date
with respect to interest and (ii) to the extent permitted by law, interest on
the amount determined pursuant to clause (i)(b) at the applicable Pass-Through
Rate for the number of days in the related Accrual Period.
"INVOLUNTARY PAYOFF": The amount of Net Liquidation Proceeds
received with respect to a Liquidated Loan.
"LAND HOME CONTRACT": A Contract that is secured by a
mortgage, deed of trust, security deed or similar evidence of lien on real
estate on which the related Manufactured Home is situated (as well as by such
related Manufactured Home).
"LAND HOME CONTRACT FILE": As to each Land Home Contract, (a)
the original copy of the Land Home Contract, (b) the original related Mortgage
with evidence of recording thereon (or, if the original Mortgage has not yet
been returned by the applicable recording office, a copy thereof, certified by
such recording office, which will be replaced by the original Mortgage when it
is so returned) and any title document for the related Manufactured Home, (c)
the assignment of the Land Home Contract from the originator to Deerwood
Corporation, (d) if such Land Home Contract was originated by Deerwood
Corporation, an endorsement of such Land Home Contract by Deerwood Corporation
and (e) any extension, modification or waiver agreement(s). Notwithstanding
anything contained in this definition to the contrary, Schedule A to the title
insurance policy for a Mortgage will satisfy the requirements of a title
document in clause (b) herein.
"LATE PAYMENT RATE": The greater of (i) the rate of interest,
as it is publicly announced by Citibank, N.A. at its principal office in New
York, New York as its prime rate (any change in such prime rate of interest to
be effective on the date such change is announced by Citibank, N.A.) plus 2% and
(ii) the then applicable highest Pass-Through Rate on the Class A Certificates.
The Late Payment Rate shall be computed on the basis of a year of 360 days and
the actual number of days elapsed. In no event shall the Late Payment Rate
exceed the maximum rate permissible under any applicable law limiting interest
rates.
"LAW": Any law (including common law and the laws of equity),
constitution, statute, treaty, regulation, rule, administrative guideline,
ordinance, judgment, order, injunction, writ, decree or award of any
Governmental Authority, including, without limitation, any rules, regulations or
guidelines promulgated or issued
21
by ▇▇▇▇▇▇ Mae, ▇▇▇▇▇▇▇ Mac or any other Governmental Authority applicable to the
Seller or any of the Mortgage Loans or Sale Agreements.
"LIBOR": means the per annum rate calculated by the Trustee as
set forth below:
(i) on each LIBOR Determination Date, LIBOR for such Accrual
Period will be the rate for deposits in United States dollars for a
one-month period which appears on the display designated as "Page 3750"
on the Dow ▇▇▇▇▇ Telerate Service as of 11:00 a.m., London time, on
such date;
(ii) with respect to a LIBOR Determination Date on which no
such rate appears on Telerate page 3750 as described above, LIBOR for
the applicable Accrual Period will be determined on the basis of the
rates at which deposits in United States dollars are offered by the
Reference Banks at approximately 11:00 a.m., London time, on such date
for a one-month period (each, a "Reference Bank Rate") and in an amount
that is representative for a single transaction in the London-interbank
market at that time. The Trustee shall request the principal London
office of each of the Reference Banks to provide a quotation of its
Reference Bank Rate. If at least two such quotations are provided,
LIBOR for such Accrual Period will be the arithmetic mean of such
quotations. If fewer than two quotations are provided, LIBOR for such
Accrual Period will be the arithmetic mean of the rates quoted by major
banks in New York City, selected by the Trustee, at approximately 11:00
a.m., New York City time, on such date for loans in United States
dollars to leading European banks for a one-month period and in an
amount that is representative for a single transaction in such market
at that time.
All percentages resulting from any calculations referred to in
this definition will be rounded upwards to the nearest multiple of 1/100,000 of
1% and all U.S. dollar amounts used in or resulting from such calculations will
be rounded to the nearest cent (with one-half cent or more being rounded
upwards).
"LIBOR DETERMINATION DATE":
(i) January 27, 2003 for the period beginning on and including
the Closing Date and ending on and excluding the first Distribution
Date; and thereafter,
(ii) the second London Business Day prior to the first day of
each Accrual Period following the first Accrual Period.
"LIFETIME RATE CAP": The provision of each Mortgage Note
related to an Adjustable Rate Mortgage Loan which provides for an absolute
maximum Mortgage Rate thereunder. The Mortgage Interest Rate during the terms of
each Adjustable Rate Mortgage Loan shall not at any time exceed the Mortgage
Rate at the time of origination
22
of such Adjustable Rate Mortgage Loan by more than the amount per annum set
forth on the Schedule of Mortgage Loans.
"LIQUIDATED LOAN": A Mortgage Loan with respect to which (i) a
Final Recovery Determination has been made by the related Servicer or which the
related Servicer has charged off pursuant to the terms of this Agreement and
(ii) GreenPoint has taken action pursuant to Section 3.11 of the GreenPoint
Servicing Agreement.
"LIQUIDATION EXPENSES": Expenses which are incurred by a
Servicer in connection with the liquidation of any defaulted Mortgage Loan, such
expenses including, without limitation, legal fees and expenses and any
unreimbursed Advances made by the related Servicer with respect to such Mortgage
Loan.
"LIQUIDATION PROCEEDS": With respect to any Liquidated Loan,
any amounts (including the proceeds of any insurance policy) recovered in
connection with such Liquidated Loan, whether through trustee's sale,
foreclosure sale, short sale or otherwise.
"LOAN PURCHASE PRICE": With respect to any Mortgage Loan, a
price equal to (A) the Stated Principal Balance of such Mortgage Loan PLUS (B)
interest on such Stated Principal Balance at the Mortgage Rate minus the
Servicing Fee Rate applicable to such Mortgage Loan from the date on which
interest has last been paid and distributed to the Trust to the last day of the
month of repurchase, together with, (without duplication) the aggregate amounts
of (C) Advances theretofore made with respect to such Mortgage Loan, (D) in the
case of Monthly Advances thereon made by the Trustee, interest thereon at the
prime rate shown as such in the Wall Street Journal plus 2.00% per annum, (E) in
the case of a Mortgage Loan that has been subject to a Realized Loss, the amount
of such Realized Loss, (F) amounts owed to the Certificate Insurer related to
such Mortgage Loan and (G) any accrued and unpaid Servicing Fees for such
Mortgage Loan.
"LOAN-TO-VALUE RATIO": As of any particular date, the
percentage obtained by dividing the Stated Principal Balance of the related
Mortgage Loan as of its date of origination or acquisition by the related Seller
by the Appraised Value of the Mortgaged Property.
"LONDON BUSINESS DAY": Any day on which banks in London,
England and New York City, New York are open for business to deal in deposits of
United States dollars in the London interbank market.
"LOSSES": As defined in SECTION 2.11(A).
"LOST NOTE AFFIDAVIT": A lost note affidavit referencing a
single Mortgage Loan delivered pursuant to any of the Sale Agreements.
"MAJORITY CLASS X CERTIFICATEHOLDER": Shall mean the holders
of Class X Certificates evidencing, in the aggregate, more than a 50% Percentage
Interest.
23
"MANUFACTURED HOME": A unit of manufactured housing which
meets the requirements of Section 25(e)(10) of the Code, securing the
indebtedness of the obligor under the related Contract.
"MARKER RATE": With respect to the Class X Certificates and
any Distribution Date, a per annum rate equal to two (2) multiplied by the
weighted average of the Uncertificated REMIC I Pass-Through Rates for each REMIC
I Regular Interest (other than REMIC I Regular Interest LT-AA and REMIC I
Regular Interest LT-P), with the rates on each such REMIC I Regular Interest
subject to a cap equal to the Pass-Through Rate for the Corresponding Class for
such REMIC I Regular Interest, and the rate on REMIC I Regular Interest LT-ZZ
subject to a cap of zero for purposes of this calculation.
"MASTER SERVICER": Wilshire in its capacity as master servicer
of the Contracts and any successor thereto.
"MERS": Mortgage Electronic Registration Systems, Inc.
"MERS DESIGNATED MORTGAGE LOAN": Any Mortgage Loan as to which
MERS is acting as mortgagee, solely as nominee for the owner of such Mortgage
Loan and its successors and assigns and identified as such on the Schedule of
Mortgage Loans.
"MINIMUM MORTGAGE RATE": With respect to each Adjustable Rate
Mortgage Loan, the percentage set forth in the related Mortgage Note as the
minimum Mortgage Rate thereunder.
"MONTHLY ADVANCE": An advance by the Servicer pursuant to
SECTION 8.05(C) hereof, the Master Servicer pursuant to SECTION 9.02 hereof or
the Trustee pursuant to SECTION 8.05(F).
"MONTHLY PAYMENT": The scheduled monthly payment of principal
and interest required to be made by a Mortgagor on the related Mortgage Loan, as
set forth in the related Mortgage Note.
"MOODY'S": ▇▇▇▇▇'▇ Investor Service, Inc., and its successors.
"MORTGAGE": The mortgage, deed of trust or other instrument
creating a first lien on an estate in fee simple or leasehold estate interest in
real property securing a Mortgage Note.
"MORTGAGE LOAN DOCUMENTS": With respect to any Mortgage Loan,
all agreements, instruments, promissory notes, financing statements, mortgages,
security agreements, assignments, Lost Note Affidavits, Sale Agreements and
other documents executed and delivered by any Person in connection with such
Mortgage Loan, whether such documents are in the possession or under the control
of the Trustee, the Custodian, the relevant Servicer or any other Person.
24
"MORTGAGE LOANS": Such of the mortgage loans and Contracts
transferred and assigned to the Trust pursuant to SECTION 3.04(A), as from time
to time are held as a part of the Trust Estate, the Mortgage Loans originally so
held being identified in the Schedule of Mortgage Loans. The term "MORTGAGE
LOAN" includes, without limitation, any Mortgage Loan which is current or
Delinquent, which relates to a foreclosure or which relates to a Mortgaged
Property which is REO Property prior to such Mortgaged Property's disposition by
the Trust.
"MORTGAGE NOTE": The note or other evidence of indebtedness
evidencing the indebtedness of a Mortgagor under a Mortgage Loan.
"MORTGAGE RATE": The rate of interest borne by each Mortgage
Note according to its terms.
"MORTGAGED PROPERTY": The underlying property (including all
buildings and other improvements thereon) securing a Mortgage Loan, together
with any personal property, fixtures and other property or rights pertaining
thereto.
"MORTGAGOR": The obligor on a Mortgage Note.
"NET LIQUIDATION PROCEEDS": As to any Liquidated Loan,
Liquidation Proceeds net of Liquidation Expenses relating to such Mortgage Loan.
If Net Liquidation Proceeds with respect to any Liquidated Loan are less than
zero, then the related Servicer or the Master Servicer shall be entitled to be
reimbursed for Nonrecoverable Advances made by such Servicer or the Master
Servicer, as applicable, with respect to such Mortgage Loan pursuant to SECTION
8.04(D)(I).
"NET MONTHLY EXCESS CASHFLOW": With respect to any
Distribution Date, the excess of (x) the Available Distribution Amount for such
Distribution Date over (y) the sum for such Distribution Date of (A) the
aggregate Accrued Certificate Interest for the Offered Certificates for such
Distribution Date, (B) the aggregate unpaid Accrued Certificate Interest for the
Class A Certificates for such Distribution Date, (C) all amounts payable to the
Certificate Insurer for such Distribution Date (other than the Certificate
Insurer Premium) and (D) the Basic Principal Distribution Amount.
"NET RATE": With respect to each Mortgage Loan, the Mortgage
Rate of such Mortgage Loan less the Administrative Cost Rate.
"NET SIMPLE INTEREST EXCESS": As of any Remittance Date, the
excess, if any, of the aggregate amount of Simple Interest Excess over the
amount of Simple Interest Shortfall.
"NET SIMPLE INTEREST SHORTFALL": As of any Remittance Date,
the excess, if any, of the aggregate amount of Simple Interest Shortfall over
the amount of Simple Interest Excess.
25
"NONRECOVERABLE ADVANCE": With respect to any Mortgage Loan,
(i) any Advance previously made which, in the good faith business judgment of
the related Servicer, the Master Servicer or the Trustee, as applicable will not
be reimbursed from proceeds of that Mortgage Loan pursuant to this Agreement, or
(ii) any Advance proposed to be made in respect of a Mortgage Loan which, in the
good faith business judgment of the related Servicer, the Master Servicer or the
Trustee, would not ultimately be recoverable from proceeds of such Mortgage
Loan.
"NON-U.S. PERSONS": Any Person other than a United States
Person.
"NOTICE": As defined in SECTION 7.03(A).
"NOTICE OF FINAL DISTRIBUTION: The notice to be provided
pursuant to SECTION 10.04 to the effect that a final distribution on any of the
Certificates shall be made only upon presentation and surrender thereof.
"OFFERED CERTIFICATES": The Class A Certificates, the Class
M-1 Certificates and the Class B Certificates.
"OFFICER'S CERTIFICATE": A certificate signed by any
Authorized Officer of any Person delivering such certificate and delivered to
the Trustee.
"OPERATIVE DOCUMENTS": Collectively, this Agreement, the
Certificates, the Sale Agreements, the Custody Agreements, the Assignment
Agreements and the Certificate Insurance Agreement.
"OPINION OF COUNSEL": A written opinion of counsel, who may,
without limitation, be salaried counsel for the Depositor, a Servicer or the
Master Servicer, acceptable to the Trustee, except that any opinion of counsel
relating to (a) the qualification of any of any REMIC as a REMIC or (b)
compliance with the REMIC Provisions must be an opinion of Independent counsel.
"OPTIONAL BUYOUT LOAN": A Mortgage Loan purchased from the
Trust by the Majority Class X Certificateholder pursuant to SECTION 8.21.
"ORIGINAL POOL BALANCE": The Pool Balance of the Mortgage
Loans as of the Cut-off Date.
"ORIGINAL PRINCIPAL BALANCE": The Stated Principal Balance of
a Mortgage Loan as of the Cut-off Date.
"OTHER ASSETS": With respect to any Mortgage Loan, any and all
Related Security and Collections relating to such Mortgage Loan and any and all
Proceeds of such Mortgage Loan, Related Security and/or Collections.
26
"OUTSTANDING": With respect to all Certificates of a Class, as
of any date of determination, all such Certificates theretofore executed and
delivered hereunder except:
(i) Certificates theretofore canceled by the Registrar or
delivered to the Registrar for cancellation;
(ii) Certificates or portions thereof for which full and final
payment of money in the necessary amount has been theretofore deposited
with the Trustee or any Paying Agent in trust for the Owners of such
Certificates;
(iii) Certificates in exchange for or in lieu of which other
Certificates have been executed and delivered pursuant to this
Agreement, unless proof satisfactory to the Trustee is presented that
any such Certificates are held by a bona fide purchaser;
(iv) Certificates alleged to have been destroyed, lost or
stolen for which replacement Certificates have been issued as provided
for in SECTION 5.03; and
(v) Certificates as to which the Trustee has made the final
distribution thereon, whether or not such Certificate is ever returned
to the Trustee.
"OVERCOLLATERALIZATION AMOUNT": As of any Distribution Date,
the excess, if any, of (x) the Pool Balance as of the close of business on the
last day of the related Collection Period, over (y) the aggregate Certificate
Balance of the Certificates (other than the Class X Certificates) on such
Distribution Date, assuming that the Principal Remittance Amount for such
Distribution Date was distributed in reduction of the Certificate Balance of the
Certificates on such Distribution Date.
"OVERCOLLATERALIZATION DEFICIENCY AMOUNT": For any
Distribution Date, the excess, if any, of (1) the Required Overcollateralization
Amount for such Distribution Date, over (2) the then-current
Overcollateralization Amount, assuming that the Principal Remittance Amount for
such Distribution Date was distributed in reduction of the Certificate Balance
of the Certificates (other than the Class X Certificates) on such Distribution
Date.
"OVERCOLLATERALIZATION REDUCTION AMOUNT": On any Distribution
Date, the lesser of (i) the Excess Subordinated Amount over (ii) the Principal
Remittance Amount.
"OWNER": The Person in whose name a Certificate is registered
in the Register to the extent described in SECTION 5.02; PROVIDED that solely
for the purposes of determining the exercise of any voting rights hereunder, if
any Offered Certificates are beneficially owned by a Seller, the Depositor or
any Affiliate thereof, such Seller, the Depositor or such Affiliate shall not be
considered an Owner hereunder.
"OWNERSHIP INTEREST": As to any Certificate, any ownership or
security interest in such Certificate, including any interest in such
Certificate as the Holder thereof
27
and any other interest therein, whether direct or indirect, legal or beneficial,
as owner or as pledgee.
"PASS-THROUGH RATE": For each Class of Certificates (other
than the Class P Certificates), (a) with respect to the Class A-1 Certificates,
a rate per annum equal to the lesser of (i)(A) for any Distribution Date on or
prior to the Clean-Up Call Date, one-month LIBOR plus 0.250% (B) in the case of
any Distribution Date thereafter, one-month LIBOR plus 0.500%, and (ii) the
applicable WAC Cap; (b) with respect to the Class A-2 Certificates, a rate per
annum equal to the lesser of (i)(A) for any Distribution Date on or prior to the
Clean-Up Call Date, one-month LIBOR plus 0.700% (B) in the case of any
Distribution Date thereafter, one-month LIBOR plus 1.400%, and (ii) the
applicable WAC Cap; (c) with respect to the Class A-3 Certificates, a rate per
annum equal to the lesser of (i)(A) for any Distribution Date on or prior to the
Clean-Up Call Date, one-month LIBOR plus 0.500% (B) in the case of any
Distribution Date thereafter, one-month LIBOR plus 1.000%, and (ii) the
applicable WAC Cap; (d) with respect to the Class M-1 Certificates, a rate per
annum equal to the lesser of (i)(A) for any Distribution Date on or prior to the
Clean-Up Call Date, one-month LIBOR plus 2.600% (B) in the case of any
Distribution Date thereafter, one-month LIBOR plus 3.900%, and (ii) the
applicable WAC Cap; (e) with respect to the Class B-1 Certificates, a rate per
annum equal to the lesser of (i)(A) for any Distribution Date on or prior to the
Clean-Up Call Date, one-month LIBOR plus 3.650% (B) in the case of any
Distribution Date thereafter, one-month LIBOR plus 5.475%, and (ii) the
applicable WAC Cap; (f) with respect to the Class B-2 Certificates, a rate per
annum equal to the lesser of (i)(A) for any Distribution Date on or prior to the
Clean-Up Call Date, one-month LIBOR plus 4.500% (B) in the case of any
Distribution Date thereafter, one-month LIBOR plus 6.750%, and (ii) the
applicable WAC Cap; and (g) with respect to the Class B-3 Certificates, a rate
per annum equal to the lesser of (i)(A) for any Distribution Date on or prior to
the Clean-Up Call Date, one-month LIBOR plus 5.250% (B) in the case of any
Distribution Date thereafter, one-month LIBOR plus 7.875%, and (ii) the
applicable WAC Cap. For each Class of Certificates (other than the Class X
Certificates), the Pass-Through Rate will be calculated using an actual/360 Day
Count Fraction.
With respect to the Class X Certificates, rate per annum equal
to the percentage equivalent of a fraction, the numerator of which is the sum of
the amounts calculated pursuant to clauses (A) through (J) below, and the
denominator of which is the Uncertificated Principal Balance of the REMIC I
Regular Interests (other than REMIC I Regular Interest LT-P). For purposes of
calculating the Pass-Through Rate for the Class X Certificates, the numerator is
equal to the sum of the following components:
(A) the Uncertificated REMIC I Pass-Through Rate for REMIC I
Regular Interest LT-AA minus the Marker Rate, applied to an amount
equal to the Uncertificated Principal Balance of REMIC I Regular
Interest LT-AA;
28
(B) the Uncertificated REMIC I Pass-Through Rate for REMIC I
Regular Interest LT-A1 minus the Marker Rate, applied to an amount
equal to the Uncertificated Principal Balance of REMIC I Regular
Interest LT-A1;
(C) the Uncertificated REMIC I Pass-Through Rate for REMIC I
Regular Interest LT-A2 minus the Marker Rate, applied to an amount
equal to the Uncertificated Principal Balance of REMIC I Regular
Interest LT-A2;
(D) the Uncertificated REMIC I Pass-Through Rate for REMIC I
Regular Interest LT-A3 minus the Marker Rate, applied to an amount
equal to the Uncertificated Principal Balance of REMIC I Regular
Interest LT-A3;
(E) the Uncertificated REMIC I Pass-Through Rate for REMIC I
Regular Interest LT-M1 minus the Marker Rate, applied to an amount
equal to the Uncertificated Principal Balance of REMIC I Regular
Interest LT-M1;
(F) the Uncertificated REMIC I Pass-Through Rate for REMIC I
Regular Interest LT-B1 minus the Marker Rate, applied to an amount
equal to the Uncertificated Principal Balance of REMIC I Regular
Interest LT-B1;
(G) the Uncertificated REMIC I Pass-Through Rate for REMIC I
Regular Interest LT-B2 minus the Marker Rate, applied to an amount
equal to the Uncertificated Principal Balance of REMIC I Regular
Interest LT-B2;
(H) the Uncertificated REMIC I Pass-Through Rate for REMIC I
Regular Interest LT-B3 minus the Marker Rate, applied to an amount
equal to the Uncertificated Principal Balance of REMIC I Regular
Interest LT-B3;
(I) the Uncertificated REMIC I Pass-Through Rate for REMIC I
Regular Interest LT-ZZ minus the Marker Rate, applied to an amount
equal to the Uncertificated Principal Balance of REMIC I Regular
Interest LT-ZZ; and
(J) 100% of the interest on REMIC I Regular Interest LT-P.
The Class P Certificates do not have a Pass-Through Rate and
are not entitled to distributions in respect of interest.
"PAYING AGENT": Initially, the Trustee, and thereafter, the
Trustee or any other Person that meets the eligibility standards for the Paying
Agent specified in SECTION 12.15 and is authorized by the Trustee and the
Depositor to make payments on the Certificates on behalf of the Trustee.
"PERCENTAGE INTEREST": With respect to a Class of the Class A
Certificates, the Class M-1 Certificates, a Class of the Class B Certificates or
the Class P Certificates, a fraction, expressed as a percentage, the numerator
of which is the initial Certificate Balance represented by such Certificate and
the denominator of which is the aggregate
29
initial Certificate Balance represented by all the Certificates in such Class.
With respect to the Class X and Class R Certificates, the portion of such Class
evidenced thereby, expressed as a percentage, as stated on the face of such
Certificate, all of which shall total 100%.
"PERIODIC RATE CAP": With respect to each Adjustable Rate
Mortgage Loan and any Adjustment Date therefor, the fixed percentage set forth
in the related Mortgage Note, which is the maximum amount by which the Mortgage
Rate for such Adjustable Rate Mortgage Loan may increase or decrease (without
regard to the Lifetime Rate Cap or the Minimum Mortgage Rate) on such Adjustment
Date from the Mortgage Rate in effect immediately prior to such Adjustment Date.
"PERMITTED TRANSFEREE": Any Transferee of a Residual
Certificate other than a Disqualified Organization or a Non-U.S. Person.
"PERSON": Any individual, corporation, partnership, limited
liability company, joint venture, association, joint-stock company, trust,
unincorporated organization or government or any agency or political subdivision
thereof.
"PLAN": Any employee benefit plan or certain other retirement
plans and arrangements, including individual retirement accounts and annuities,
▇▇▇▇▇ plans and bank collective investment funds and insurance company general
or separate accounts in which such plans, accounts or arrangements are invested,
that are subject to ERISA or Section 4975 of the Code.
"POOL BALANCE": As of any date, the aggregate Stated Principal
Balance of the Mortgage Loans as of the end of the preceding Collection Period.
"PREFERENCE AMOUNT": Means any payment of principal or
interest on any Class A Certificate which has become due for payment and which
is made to such Class A Certificateholder by or on behalf of the Trustee which
has been deemed a preferential transfer and was previously recovered from its
Owner pursuant to the Bankruptcy Code in accordance with a final, nonappealable
order of a court of competent jurisdiction.
"PREPAID INSTALLMENT": With respect to any Mortgage Loan, any
Monthly Payment thereon received by the relevant Servicer prior to the scheduled
due date for such installment, intended by the Mortgagor as an early payment
thereof and not as a Principal Prepayment or Curtailment with respect to such
Mortgage Loan.
"PREPAYMENT PENALTY": With respect to any Mortgage Loan, any
prepayment penalty, premium or charge payable by the Mortgagor pursuant to the
terms of the Mortgage Note in connection with any voluntary prepayment in full
of the principal of the Mortgage Loan to the extent permitted by law.
"PRESERVATION EXPENSES": Expenditures made by the related
Servicer in connection with a foreclosed Mortgage Loan prior to the liquidation
thereof, including,
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without limitation, expenditures for real estate property taxes, hazard
insurance premiums, property restoration or preservation.
"PRIMARY INSURANCE POLICY": Insurance obtained from a private
insurer which insures the holder of a Mortgage Note against loss in the event
the Mortgagor defaults under the Note, including all riders and endorsements
thereto.
"PRINCIPAL DISTRIBUTION AMOUNT": For any Distribution Date,
the sum of (i) the Basic Principal Distribution Amount and (ii) the Extra
Principal Distribution Amount.
"PRINCIPAL PREPAYMENT": Any full or partial payment or other
recovery of principal on a Mortgage Loan which is received in advance of its
scheduled Due Date, excluding any Prepayment Penalty and which is not
accompanied by an amount of interest representing scheduled interest due on any
date or dates in any month or months subsequent to the month of prepayment.
"PRINCIPAL PREPAYMENT IN FULL": Any Principal Prepayment made
by a Mortgagor of the entire unpaid principal balance of a Mortgage Loan.
"PRINCIPAL REMITTANCE AMOUNT: With respect to any Distribution
Date, the amount equal to the sum of the following amounts (without duplication)
with respect to the related Due Period: (i) each scheduled payment of principal
on a Mortgage Loan due during such Due Period whether or not received on or
prior to the related Determination Date (including the portion of Insurance
Proceeds or Condemnation Proceeds allocable to principal), and all Principal
Prepayments received during the related Collection Period, (ii) the Liquidation
Proceeds on the Mortgage Loans allocable to principal received during the
related Collection Period, (iii) the portion of the Loan Purchase Price
allocable to principal with respect to each Mortgage Loan, the repurchase
obligation for which arose during the related Collection Period and (iv) the
allocable portion of the proceeds received with respect to the termination of
the Trust Fund (to the extent such proceeds relate to principal).
"PRIVATE CERTIFICATES": Collectively, the Class P, Class X and
Residual Certificates.
"PROCEEDS": Whether or not capitalized, "proceeds" as such
term is defined in Section 9-102 of the UCC, including all cash and non-cash
proceeds and further including all accounts, accounts receivable, contract
rights, money, claims for money (whether or not earned by performance), checks,
deposit accounts, documents, instruments, chattel paper, investment property
(including securities, securities entitlements, securities accounts, commodity
contracts and commodity accounts), general intangibles, insurance proceeds and
other property (including fixtures, products and accessions).
"PROHIBITED TRANSACTION": The meaning set forth from time to
time in the definition thereof at Section 860F(a)(2) of the Code and applicable
to the Trust.
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"PROSPECTUS SUPPLEMENT ": The Prospectus Supplement dated
January 24, 2003 to the Prospectus dated December 23, 2002, prepared by the
Depositor with respect to the public offering of the Offered Certificates
"PURCHASE OPTION PERIOD": As defined in SECTION 10.03.
"PURCHASER": The Depositor, in its capacity as the purchaser,
under the relevant Sale Agreement, together with the Trustee as the assignee of
the Depositor hereunder.
"QUALIFIED INSTITUTION": With respect to each Collection
Account and the Certificate Account, an account maintained by a federal or state
chartered depository institution acceptable to the Depositor and the Certificate
Insurer, having combined capital and surplus of at least $50,000,000; PROVIDED,
HOWEVER, that if any Collection Account or the Certificate Account is not
maintained with the Trustee, (i) (A) with respect to each Collection Account,
such institution shall have a long-term debt rating of at least "A2" by ▇▇▇▇▇'▇,
"AA-" by Standard & Poor's, and, if rated by Fitch, at least "AA-" by Fitch and
(B) with respect to the Certificate Account, such institution shall have a
long-term debt rating of at least "A2" by ▇▇▇▇▇'▇, "A" by Standard & Poor's,
and, if rated by Fitch, at least "AA-" by Fitch, (ii) (A) with respect to each
Collection Account, a short-term debt rating of at least "A-1+" by Standard &
Poor's, "P-1" by ▇▇▇▇▇'▇ and if rated by Fitch, at least "F1" by Fitch and (B)
with respect to the Certificate Account, a short-term debt rating of at least
"A-1" by Standard & Poor's, "P-1" by ▇▇▇▇▇'▇ and if rated by Fitch, at least
"F1" by Fitch and (iii) if such Collection Account or the Certificate Account is
moved to a new institution, the relevant Servicer shall provide the Trustee, the
Owners and the Certificate Insurer with a statement identifying the location of
such Collection Account or the Certificate Account.
"QUALIFIED LIQUIDATION": The meaning set forth from time to
time in the definition thereof at Section 860F(a)(4) of the Code and applicable
to the Trust.
"QUALIFIED MORTGAGE": The meaning set forth from time to time
in the definition thereof at Section 860G(a)(3) of the Code and applicable to
the Trust.
"RATING AGENCIES": ▇▇▇▇▇'▇ and Standard & Poor's or any
successors thereto. If such agencies or their successors are no longer in
existence, "Rating Agencies" shall be such nationally recognized statistical
rating agencies, or other comparable Persons, designated by the Depositor,
notice of which designation shall be given to the Trustee, the Servicers and the
Master Servicer.
"REALIZED LOSS": With respect to each Liquidated Loan, an
amount equal to (i) the Stated Principal Balance of the Mortgage Loan, plus all
accrued and unpaid interest thereon and outstanding Servicing Advances and other
expenses related thereto, as of the date of such liquidation, minus (ii) the Net
Liquidation Proceeds (not less than zero for purposes of calculating Realized
Losses) relating to such Liquidated Loan (such Net Liquidation Proceeds to be
applied first to interest and then to the Stated Principal Balance of the
Liquidated Loan). With respect to each Mortgage Loan which has
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become the subject of a Deficient Valuation, the Realized Loss shall be
calculated as the difference between the Stated Principal Balance of the
Mortgage Loan immediately prior to such Deficient Valuation and the Stated
Principal Balance of the Mortgage Loan as determined pursuant to such Deficient
Valuation. With respect to any payment by the Trust of Trust Expenses, a
Realized Loss shall be deemed to have occurred whenever such Trust Expenses are
paid.
"REALIZED LOSS AMOUNT": For any Distribution Date, after
taking into account all Realized Losses experienced on the Mortgage Loans during
the preceding Collection Period and after taking into account the distribution
of the Principal Distribution Amount to the Certificates, the amount applied to
reduce the Certificate Balance or, in the case of the Class X Certificates, the
amount applied to reduce the Class X Distribution Amount, in each case, in
accordance with SECTION 7.07.
"RECORD DATE": With respect to each Distribution Date, the
Business Day immediately preceding such Distribution Date.
"RECORDS": With respect to any Mortgage Loan, all Mortgage
Loan Documents and other material documents held or maintained by or for the
Depositor, the Trustee, the Custodian, the relevant Servicer or any other Person
(including any Subservicer) with respect to such Mortgage Loan and/or the
related Mortgagor, including the Custodial File and any and all Servicing
Records.
"REFERENCE BANKS": Four major banks in the London interbank
market selected by the Trustee with consultation from the Depositor.
"REGISTER": The register maintained by the Registrar in
accordance with SECTION 5.02, in which the names of the Owners are set forth.
"REGISTRAR": The Trustee, acting in its capacity as Registrar
appointed pursuant to SECTION 5.02, or any duly appointed and eligible successor
thereto.
"REGULAR CERTIFICATE": Any Class A Certificate, Class M-1
Certificate, Class B Certificate, Class X Certificate or Class P Certificate.
"REGULAR INTEREST": A "regular interest" in a REMIC within the
meaning of Section 860G(a)(1) of the Code.
"REIMBURSEMENT AMOUNT": As of any Distribution Date, the sum
of (x) (i) all Insured Payments paid by the Certificate Insurer, but for which
the Certificate Insurer has not been reimbursed prior to such Distribution Date
pursuant to Section 7.06(b), PLUS (ii) interest accrued on such Insured Payments
not previously repaid calculated at the Late Payment Rate from the date the
Trustee received the related Insured Payments or the date such Insured Payments
were made, and (y) without duplication (i) any amounts then due and owing to the
Certificate Insurer under the Certificate Insurance Agreement, as certified to
the Trustee by the Certificate Insurer PLUS (ii) interest on such
33
amounts at the Late Payment Rate from the date such amounts become due until
paid in full.
"RELATED SECURITY": With respect to any Mortgage Loan, all
right, title and interest of each and all of the Sellers and the Depositor in
and to:
(i) the related Mortgaged Property securing such Mortgage
Loan;
(ii) all other security interests or liens and property
subject thereto from time to time, if any, purporting to secure payment
of such Mortgage Loan, whether pursuant to the related Mortgage Loan
Documents or otherwise, together with all financing statements and
similar documents signed by a Mortgagor describing any collateral
securing such Mortgage Loan;
(iii) all guarantees, indemnities, warranties, insurance
policies (including any premium refunds and other proceeds thereof) and
other agreements or arrangements of any kind from time to time
supporting or securing payment of such Mortgage Loan, whether pursuant
to the Mortgage Loan Documents related to such Mortgage Loan or
otherwise; and
(iv) all Records related to such Mortgage Loan.
"RELIEF ACT SHORTFALL": With respect to any Collection Period
and any Mortgage Loan as to which the interest rate has been reduced during such
Collection Period by application of the Civil Relief Act, the excess, if any, of
(i) the interest payable on such Mortgage Loan at its Mortgage Rate over (ii)
the interest payable thereon at the rate imposed by the Civil Relief Act.
"REMIC": A "real estate mortgage investment conduit" within
the meaning of Section 860A through 860G of the Code.
"REMIC I": The segregated pool of assets subject hereto,
constituting a portion of the primary trust created hereby and to be
administered hereunder, with respect to which a separate REMIC election is to be
made (other than with respect to the items in clause (v) and the proceeds
thereof), consisting of: (i) the Mortgage Loans and the related Mortgage Files
Contract Files and Land Home Contract Files; (ii) all payments on and
collections in respect of the Mortgage Loans due after the Cut-off Date (other
than Monthly Payments due in January 2003) as shall be on deposit in the
Certificate Account and identified as belonging to the Trust Estate; (iii)
property which secured a Mortgage Loan and which has been acquired for the
benefit of the Certificateholders by foreclosure or deed in lieu of foreclosure;
(iv) Insurance Policies pertaining to the Mortgage Loans, if any; and (v) all
proceeds of clauses (i) through (iv) above.
REMIC I INTEREST LOSS ALLOCATION AMOUNT: With respect to any
Distribution Date, an amount equal to (a) the product of (i) the aggregate
Uncertificated Principal Balance of the REMIC I Regular Interests then
outstanding and (ii) the
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Uncertificated Pass-Through Rate for REMIC I Regular Interest LT-AA minus the
Marker Rate, divided by (b) 12.
REMIC I OVERCOLLATERALIZED AMOUNT: With respect to any date of
determination, (i) 1% of the aggregate Uncertificated Principal Balances of the
REMIC I Regular Interests minus (ii) the Uncertificated Principal Balances of
the REMIC I Regular Interests (other than REMIC I Regular Interests LT-AA and
REMIC I Regular Interest LT-ZZ), in each case as of such date of determination.
REMIC I OVERCOLLATERALIZATION TARGET AMOUNT: 1% of the
Required Overcollateralization Amount.
REMIC I PRINCIPAL LOSS ALLOCATION AMOUNT: With respect to any
Distribution Date, an amount equal to the product of (i) the aggregate Stated
Principal Balance of the Mortgage Loans then outstanding and (ii) 1 minus a
fraction, the numerator of which is two times the sum of the Uncertificated
Principal Balances of REMIC I Regular Interests LT-A1, LT-A2, LT-A3, LT-M1,
LT-B1, LT-B2 and LT-B3 and the denominator of which is the sum of the
Uncertificated Principal Balances of REMIC I Regular Interests LT-A1, LT-A2,
LT-A3, LT-M1, ▇▇-▇▇, ▇▇-▇▇, ▇▇-▇▇ and LT-ZZ.
REMIC I REGULAR INTERESTS: REMIC I Regular Interest LT-AA,
REMIC I Regular ▇▇▇▇▇▇▇▇ ▇▇-▇▇, REMIC I Regular ▇▇▇▇▇▇▇▇ ▇▇-▇▇, REMIC I Regular
▇▇▇▇▇▇▇▇ ▇▇-▇▇, REMIC I Regular Interest LT-M1, REMIC I Regular Interest LT-B1,
REMIC I Regular Interest LT-B2, REMIC I Regular Interest LT-B3, REMIC I Regular
Interest LT-ZZ and REMIC I Regular Interest LT-P.
REMIC I REGULAR INTEREST LT-AA: A regular interest in REMIC I
that is held as an asset of REMIC II, that has an initial principal balance
equal to the related Uncertificated Principal Balance, that bears interest at
the related Uncertificated REMIC I Pass-Through Rate, and that has such other
terms as are described herein.
REMIC I REGULAR INTEREST LT-A1: A regular interest in REMIC I
that is held as an asset of REMIC II, that has an initial principal balance
equal to the related Uncertificated Principal Balance, that bears interest at
the related Uncertificated REMIC I Pass-Through Rate, and that has such other
terms as are described herein.
REMIC I REGULAR INTEREST LT-A2: A regular interest in REMIC I
that is held as an asset of REMIC II, that has an initial principal balance
equal to the related Uncertificated Principal Balance, that bears interest at
the related Uncertificated REMIC I Pass-Through Rate, and that has such other
terms as are described herein.
REMIC I REGULAR INTEREST LT-A3: A regular interest in REMIC I
that is held as an asset of REMIC II, that has an initial principal balance
equal to the related Uncertificated Principal Balance, that bears interest at
the related Uncertificated REMIC I Pass-Through Rate, and that has such other
terms as are described herein.
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REMIC I REGULAR INTEREST LT-M1: A regular interest in REMIC I
that is held as an asset of REMIC II, that has an initial principal balance
equal to the related Uncertificated Principal Balance, that bears interest at
the related Uncertificated REMIC I Pass-Through Rate, and that has such other
terms as are described herein.
REMIC I REGULAR INTEREST LT-B1: A regular interest in REMIC I
that is held as an asset of REMIC II, that has an initial principal balance
equal to the related Uncertificated Principal Balance, that bears interest at
the related Uncertificated REMIC I Pass-Through Rate, and that has such other
terms as are described herein.
REMIC I REGULAR INTEREST LT-B2: A regular interest in REMIC I
that is held as an asset of REMIC II, that has an initial principal balance
equal to the related Uncertificated Principal Balance, that bears interest at
the related Uncertificated REMIC I Pass-Through Rate, and that has such other
terms as are described herein.
REMIC I REGULAR INTEREST LT-B3: A regular interest in REMIC I
that is held as an asset of REMIC II, that has an initial principal balance
equal to the related Uncertificated Principal Balance, that bears interest at
the related Uncertificated REMIC I Pass-Through Rate, and that has such other
terms as are described herein.
REMIC I REGULAR INTEREST LT-ZZ: A regular interest in REMIC I
that is held as an asset of REMIC II, that has an initial principal balance
equal to the related Uncertificated Principal Balance, that bears interest at
the related Uncertificated REMIC I Pass-Through Rate, and that has such other
terms as are described herein.
REMIC I REGULAR INTEREST LT-P: A regular interest in REMIC I
that is held as an asset of REMIC II, that has an initial principal balance
equal to the related Uncertificated Principal Balance, that bears interest at
the related Uncertificated REMIC I Pass-Through Rate, and that has such other
terms as are described herein.
REMIC I REGULAR INTEREST LT-ZZ MAXIMUM INTEREST DEFERRAL
AMOUNT: With respect to any Distribution Date, the sum of (a) the excess of (i)
Uncertificated Accrued Interest calculated with the Uncertificated Pass-Through
Rate for REMIC I Regular Interest LT-ZZ and an Uncertificated Principal Balance
equal to the excess of (x) the Uncertificated Principal Balance of REMIC I
Regular Interest LT-ZZ over (y) the REMIC I Overcollateralized Amount, in each
case for such Distribution Date, over (ii) Uncertificated Accrued Interest on
REMIC I Regular ▇▇▇▇▇▇▇▇▇ ▇▇-▇▇, ▇▇-▇▇, ▇▇-▇▇, LT-M1, LT-B1, LT-B2 and LT-B3,
with the rate on each such REMIC I Regular Interest subject to a cap equal to
the Pass-Through Rate on the Corresponding Class for the purpose of this
calculation.
REMIC II: The segregated pool of assets subject hereto,
constituting a portion of the primary trust created hereby and to be
administered hereunder, with respect to which a separate REMIC election is to be
made, consisting of the REMIC I Regular Interests.
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REMIC II REGULAR CERTIFICATES: Any of the Class A-1, Class
A-2, Class A-3, Class M-1, Class B-1, Class B-2, Class B-3, Class X or Class P
Certificates.
"REMIC OPINION": A written opinion of independent counsel
experienced in federal income tax matters, who may not be a salaried counsel for
the Depositor or any Servicer, acceptable to the Trustee and the Certificate
Insurer, relating to (a) the qualification of any Trust REMIC as a REMIC or (b)
compliance with the REMIC Provisions.
"REMIC PROVISIONS": Provisions of the Code relating to real
estate mortgage investment conduits, which appear at Sections 860A through 860G
of the Code, related provisions and regulations (whether in proposed, temporary
or final form), announcements and rulings thereunder, as the foregoing may be in
effect from time to time.
"REMITTANCE AMOUNT": As of any Remittance Date, the sum,
without duplication, of (i) the amount remitted by GreenPoint to the Master
Servicer as set forth in the definition of "Remittance Amount" in Section 1.01
of the GreenPoint Servicing Agreement, (ii) all Monthly Payments (other than
Simple Interest Excess, if any), Curtailments, Principal Prepayments and other
payments of interest or principal received during the related Collection Period
(less the Servicing Fees with respect to such Mortgage Loans, which Servicing
Fees are reduced by Compensating Interest as provided in this Agreement), (ii)
Monthly Advances payable by the Servicers and the Master Servicer for such
Remittance Date pursuant to SECTION 8.05 or SECTION 9.02 hereof, (iii)
Compensating Interest payments remitted by the Servicers pursuant to SECTION
8.06 and by the Master Servicer pursuant to SECTION 9.03 hereof, (iv) any Loan
Purchase Price actually received by the Servicer during the Collection Period,
(v) any Indemnity Proceeds actually collected by the Servicers during the
related Collection Period, (vi) Net Liquidation Proceeds attributed to Mortgage
Loans liquidated during the related Collection Period and (vii) any amounts
withdrawn from the Simple Interest Excess Sub-Account to pay interest on the
Certificates with respect to such Remittance Date, in all cases after taking
into account items which are withdrawn from the Collection Account pursuant to
SECTION 8.04(D) hereto.
"REMITTANCE DATE": The 18th day of each calendar month, or if
such day is not a Business Day, the immediately preceding Business Day.
"REO PROPERTY": A Mortgaged Property acquired by the relevant
Servicer on behalf of the Trust through foreclosure or deed-in-lieu of
foreclosure in connection with a defaulted Mortgage Loan.
"REPRESENTATION LETTER": Letters to, or agreements with, the
Depository to effectuate a book-entry system with respect to the Certificates
registered in the Register under the nominee name of the Depository.
"REQUIRED OVERCOLLATERALIZATION AMOUNT": For any Distribution
Date:
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(a) prior to the Stepdown Date and so long as no Trigger Event
is in effect, $2,571,418 and
(b) on and after the Stepdown Date and so long as no Trigger
Event is in effect, 2.00% of the Pool Balance (after giving effect to
principal payments to be distributed on the related Distribution Date),
subject to a floor of $1,285,709;
provided that (i) upon the occurrence and during the continuance of a Trigger
Event, the Required Overcollateralization Amount will equal the Required
Overcollateralization Amount as of the immediately preceding Distribution Date
(after giving effect to distributions on such date) and (ii) the Required
Overcollateralization Amount shall never exceed the then aggregate Certificate
Balance of the Certificates.
"RESIDUAL CERTIFICATES": The Class R Certificates.
"RESIDUAL INTEREST": The sole class of "residual interests" in
a REMIC within the meaning of Section 860G(a)(2) of the Code.
"RETAINED LOANS": Mortgage loans acquired by the Depositor
pursuant to the Sale Agreements that were not transferred and assigned to the
Trust pursuant to SECTION 3.04(A).
"RULE 144A LETTER": As defined in SECTION 5.02(B) hereof.
"SALE AGREEMENT": Each of (a) the ▇▇▇▇▇ Fargo Sale Agreements
and (b) the Household Sale Agreement.
"SALE AND WARRANTIES AGREEMENT": The Sale and Warranties
Agreement dated as of January 1, 2003 among ▇▇▇▇▇▇▇ Sachs Mortgage Company, the
Depositor and the Trust.
"SCHEDULE OF MORTGAGE LOANS": The schedule of Mortgage Loans
listing each Mortgage Loan to be conveyed on the Closing Date and attached
hereto as Schedule I to this Agreement. Such Schedule of Mortgage Loans shall
identify, INTER ALIA, each Mortgage Loan by the relevant Servicer's loan number
and the Mortgagor's name and address (including the state) of the Mortgaged
Property and shall set forth as to each Mortgage Loan the lien status thereof,
the Original Principal Balance, the Mortgage Rate thereof, the current scheduled
monthly payment of principal and interest and the maturity of the related
Mortgage Note, the maturity date thereof, whether or not such Mortgage Loan
(including the related Mortgage Note) has been modified, whether such Mortgage
Loan is a Simple Interest Mortgage Loan and the Original Principal Balance of
all Mortgage Loans. Such Schedule shall also identify the Lifetime Rate Cap, the
Minimum Mortgage Rate, the Index, the Gross Margin and the Periodic Rate Cap
with respect to each Adjustable Rate Mortgage Loan and the Seller and Servicer
of each Mortgage Loan.
"SCHEDULED PAYMENT": As defined in the GreenPoint Servicing
Agreement.
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"SCHEDULED PRINCIPAL BALANCE": With respect to any Mortgage
Loan as of any date other than the Cut-off Date, its original principal balance,
reduced by the principal portion of all payments that have been made or advanced
on or before such date, and Realized Losses of principal on such Mortgage Loan.
The Scheduled Principal Balance of a liquidated Mortgage Loan will equal zero.
The Scheduled Principal Balance of a Mortgage Loan as of the Cut-off Date is its
original principal balance, reduced by the principal portion of all payments
that have been made or were scheduled to have been made on or prior to the
Cut-off Date, and all reductions of principal as a result of modification of
such Mortgage Loan on or prior to such date.
"SECURITIES ACT": The Securities Act of 1933, as amended.
"SELLER": Each of Household and ▇▇▇▇▇ Fargo, in their
respective capacity as seller under the applicable Sale Agreement.
"SENIOR TRUSTEE EXPENSES": The meaning provided in SECTION
2.05.
"SERVICER": Each of Fairbanks and Wilshire and their
respective permitted successors and assigns.
"SERVICER TERMINATION EVENT": The meaning provided in (i)
SECTION 8.17 hereof with respect to Fairbanks and Wilshire and (ii) the events
of default described in Section 6.01 of the GreenPoint Servicing Agreement with
respect to GreenPoint.
"SERVICING ADVANCE": As defined in (i) SECTION 8.05 hereof
with respect to Fairbanks and Wilshire and (ii) an advance made by GreenPoint
pursuant to the GreenPoint Servicing Agreement.
"SERVICING CLAIM": As defined in (i) SECTION 8.03(A) hereof
with respect to Fairbanks and Wilshire and (ii) any claims, penalties, fines,
forfeitures, damages, liabilities, losses and expenses, including reasonable
attorney's fees subject to indemnification under Section 5.02 of the GreenPoint
Servicing Agreement with respect to GreenPoint.
"SERVICING COMPENSATION": With respect to any Mortgage Loan
and each Remittance Date, the amount equal to the sum of (i) the Servicing Fee
and (ii) all amounts in respect of late fees, assumption fees, release fees, bad
check charges and similar fees actually received. In addition, as compensation
for its servicing and administration services hereunder, the relevant Servicer
shall be entitled to retain as part of Servicing Compensation any interest paid
on Eligible Investments credited to the Collection Account.
"SERVICING FEE": With respect to each Collection Period and
(i) each Fairbanks Mortgage Loan and Wilshire Mortgage Loan, the product of (A)
the related Servicing Fee Rate, (B) the Stated Principal Balance of such
Mortgage Loan at the beginning of such Collection Period and (C) the number of
days during the Due Period for such Mortgage Loan that ended in such Collection
Period, for which interest accrued
39
on such Mortgage Loan, divided by 360. Except as otherwise provided in Section
8.12 of this Agreement, the right of Fairbanks and Wilshire to payment of the
Servicing Fee is limited to, and the Servicing Fee is payable solely from, the
interest portion of such Monthly Payment collected by such Servicer, and is
payable solely when such portion is collected.
"SERVICING FEE RATE": Shall mean (i) with respect to each
Contract, 1.00% per annum and (ii) with respect to each Mortgage Loan, 0.50% PER
ANNUM.
"SERVICING FILE": With respect to any Mortgage Loan, the file
(maintained in any form or format whatsoever, including in electronic form)
containing: (i) copies of certain documents executed or delivered in connection
with the closing of such Mortgage Loan, including without limitation copies of
the Mortgage Note, Mortgage and any assignments of such Mortgage, and (ii) any
servicing documentation which relates to such Mortgage Loan of the type
customarily included by the Servicers in their servicing files.
"SERVICING RECORDS": With respect to any Mortgage Loan, all
books and records in any form or format whatsoever (including records kept in
electronic form) that have been maintained by or for the Custodian, the relevant
Servicer or any Subservicer with respect to such Mortgage Loan, including all
documents (whether originals or copies), files, records, databases, computer
tapes, floppy disks, tax bills, assessment notices, binders and other proof of
insurance coverage, insurance policies, insurance premium notices, appraisals,
other closing documentation, payment history records, agreements and any other
records in any way relating to or evidencing the servicing of any such Mortgage
Loan.
"SERVICING STANDARDS": Shall mean (i) the servicing standards
for Fairbanks set forth on EXHIBIT C, and (ii) the servicing standards for
Wilshire set forth on EXHIBIT D.
"SIMPLE INTEREST CONTRACT": Any Contract that requires that
each monthly payment consist of an installment of interest which is calculated
according to the simple interest method. This method calculates interest using
the basis of the outstanding principal balance of the Simple Interest Contract
multiplied by the contract rate and further multiplied by a fraction, the
numerator of which is the number of days in the period elapsed since the
preceding payment of interest was made and the denominator of which is the
number of days in the annual period for which interest accrues on the Simple
Interest Contract.
"SIMPLE INTEREST EXCESS": As of any Remittance Date for each
Simple Interest Qualifying Loan, the excess, if any, of (i) the portion of the
Monthly Payment received from the Mortgagor for such Mortgage Loan allocable to
interest with respect to the related Collection Period, over (ii) 30 days'
interest on such Mortgage Loan at the then applicable Mortgage Rate.
40
"SIMPLE INTEREST EXCESS SUB-ACCOUNT": The sub-account of the
Collection Account established by the related Servicer, pursuant to Section
8.07(d). The Simple Interest Excess Sub-Account shall be an Eligible Account.
"SIMPLE INTEREST MORTGAGE LOAN: Any Mortgage Loan for which
the interest due thereon is calculated based on the actual number of days
elapsed between the date on which interest was last paid through the date on
which the most current payment is received.
"SIMPLE INTEREST QUALIFYING LOAN: As of any Determination
Date, any Simple Interest Mortgage Loan that was neither prepaid in full during
the related Collection Period, nor delinquent with respect to a payment that
became due during the related Collection Period as of the close of business on
the Determination Date following such Collection Period.
"SIMPLE INTEREST SHORTFALL: As of any Remittance Date for each
Simple Interest Qualifying Loan, the excess, if any, of (i) 30 days' interest on
such Mortgage Loan at the then applicable Mortgage Rate, over (ii) the portion
of the Monthly Payment received from the Mortgagor for such Mortgage Loan
allocable to interest with respect to the related Collection Period.
"SIXTY-DAY DELINQUENCY RATIO": With respect to any
Distribution Date shall mean (i) with respect to the Fairbanks Mortgage Loans, a
fraction, expressed as a percentage, the numerator of which is the aggregate of
the Stated Principal Balances of all Fairbanks Mortgage Loans that were
Delinquent 60 days or more as of the end of the calendar month preceding such
Distribution Date (including Fairbanks Mortgage Loans in foreclosure, Fairbanks
Mortgage Loans as to which the borrower is the subject of pending bankruptcy
proceedings and Fairbanks Mortgage Loans relating to REO Properties), and the
denominator of which is the sum of the aggregate Stated Principal Balance of all
the Fairbanks Mortgage Loans as of the end of such calendar month and (ii) with
respect to the Wilshire Mortgage Loans, a fraction, expressed as a percentage,
the numerator of which is the aggregate of the Stated Principal Balances of all
Wilshire Mortgage Loans that were Delinquent 60 days or more as of the end of
the calendar month preceding such Distribution Date (including Wilshire Mortgage
Loans in foreclosure, Wilshire Mortgage Loans as to which the borrower is the
subject of pending bankruptcy proceedings and Wilshire Mortgage Loans relating
to REO Properties), and the denominator of which is the sum of the aggregate
Stated Principal Balance of all the Wilshire Mortgage Loans as of the end of
such calendar month.
"STANDARD & POOR'S": Standard & Poor's Ratings Services, a
Division of The ▇▇▇▇▇▇-▇▇▇▇ Companies, Inc. or any successor thereto.
"STARTUP DAY": The Closing Date.
"STATED PRINCIPAL BALANCE": Shall mean (i) with respect to
each Simple Interest Mortgage Loan or Simple Interest Contract, the Actual
Principal Balance thereof
41
and (ii) with respect to each Actuarial Contract or Conventional Mortgage Loan,
the Scheduled Principal Balance thereof.
"STEPDOWN DATE": For each Certificate, the earlier to occur
of:
(1) the later to occur of:
(A) the Distribution Date in February
2006,
(B) the first Distribution Date on
which the Credit Enhancement
Percentage for the Class A
Certificates is greater than or
equal to 19.00%, and
(2) the Distribution Date on which the aggregate
Certificate Balance of the Class A
Certificates has been reduced to zero.
"TAX MATTERS PERSON": With respect to any Trust REMIC, the
Person designated as the "Tax Matters Person" of such Trust REMIC pursuant to
Treasury Regulation Section 1.860F-4(d).
"TELERATE PAGE 3750": The display designated as page "3750" on
the Dow ▇▇▇▇▇ Telerate Capital Markets Report (or such other page as may replace
page 3750 on that report for the purpose of displaying London interbank offered
rates of major banks).
"TERMINATION NOTICE": As defined in SECTION 10.03.
"THREE-MONTH ROLLING AVERAGE SIXTY-DAY DELINQUENCY RATE": With
respect to any Distribution Date commencing on the fourth Distribution Date, the
arithmetic average of the applicable Sixty-Day Delinquency Ratio for such
Distribution Date and each of the two preceding Distribution Dates.
"TRANSFER": Any direct or indirect transfer, sale, pledge,
hypothecation, or other form of assignment of any Ownership Interest in a
Certificate.
"TRANSFER AFFIDAVIT": As defined in SECTION 5.02(C) hereof.
"TRANSFEREE": Any Person who is acquiring by Transfer any
Ownership Interest in a Certificate.
"TRANSFEROR": Any Person who is disposing by Transfer of any
Ownership Interest in a Certificate.
"TRANSFEROR CERTIFICATE": As defined in SECTION 5.02(B)
hereof.
"TRIGGER EVENT": With respect to any Distribution Date, a
Trigger Event exists if (i) the quotient (expressed as a percentage) of (1) the
rolling three month average of the aggregate Stated Principal Balance of 60+ Day
Delinquent Mortgage Loans,
42
divided by (2) the aggregate Stated Principal Balance of the Mortgage Loans as
of the last day of the related Due Period, equals or exceeds 15.00% for such
Distribution Date or (ii) the quotient (expressed as a percentage) of (x) the
aggregate amount of Realized Losses incurred since the Cut-off Date through the
last day of the related Collection Period divided by (y) the Original Pool
Balance, exceeds the applicable percentages set forth below with respect to such
Distribution Date:
DISTRIBUTION DATE OCCURRING IN LOSS PERCENTAGE
------------------------------ ---------------
February 2006 through January 2007 5.75% for the first month, plus an additional
1/12th of 2.50% for each month thereafter, to
8.25%
February 2007 through January 2008 8.25% for the first month, plus an additional
1/12th of 1.25% for each month thereafter, to
9.50%
February 2008 through January 2009 9.50% for the first month, plus an additional
1/12th of 1.25% for each month thereafter, to
10.75%
February 2009 and thereafter 10.75%
"TRUST": GSRPM Mortgage Loan Trust 2003-1, the trust created
under this Agreement.
"TRUST ESTATE": As defined in the conveyance clause under this
Agreement.
"TRUST EXPENSES": All extraordinary, unanticipated expenses of
the Trust (including expenses of enforcing the Mortgage Loans), Advances (other
than those not permitted to be recovered from the Trust Estate) that are not
recovered from the related Mortgage Loan, Servicing Advances, to the extent not
made by the relevant Servicer or the Master Servicer, indemnity obligations of
the Trust, and other expenses permitted to be incurred hereunder and recovered
from the Trust Estate.
"TRUST REMIC": REMIC I or REMIC II.
"TRUSTEE": JPMorgan Chase Bank, a New York banking
corporation, the Corporate Trust Department of which is located on the date of
execution of this Agreement at ▇ ▇▇▇ ▇▇▇▇ ▇▇▇▇▇, ▇▇▇ ▇▇▇▇▇, ▇▇▇ ▇▇▇▇, ▇▇ ▇▇▇▇▇,
Attention: Institutional Trust Services/Structured Finance Services, GSRPM
Mortgage Securities Corp., Series 2003-1 not in its individual capacity but
solely as Trustee under this Agreement, and any successor hereunder.
43
"TRUSTEE FEE": The fee payable monthly to the Trustee on each
Distribution Date in an amount equal to the product of (i) the Trustee Fee Rate
and (ii) the Stated Principal Balance of each Mortgage Loan at the beginning of
the Collection Period related to such Distribution Date, which shall be subject
to a minimum of $7,500 annually.
"TRUSTEE FEE RATE": 0.0025 PER ANNUM.
"UCC": The Uniform Commercial Code, as in effect in the
relevant jurisdiction, as amended from time to time.
"UNCERTIFICATED ACCRUED INTEREST": With respect to any
Uncertificated Regular Interest for any Distribution Date, one month's interest
at the related Uncertificated Pass-Through Rate for such Distribution Date,
accrued on the Uncertificated Principal, immediately prior to such Distribution
Date. Uncertificated Accrued Interest for the Uncertificated Regular Interests
shall accrue on the basis of a 360-day year consisting of twelve 30-day months.
For purposes of calculating the amount of Uncertificated Accrued Interest for
the REMIC I Regular Interests for any Distribution Date, any Prepayment Interest
Shortfalls (to the extent not covered by Compensating Interest) relating to the
Mortgage Loans for any Distribution Date shall be allocated first, to
Uncertificated Accrued Interest payable to REMIC I Regular Interest LT-AA and
REMIC I Regular Interest LT-ZZ up to an aggregate amount equal to the REMIC I
Interest Loss Allocation Amount, 98% and 2%, respectively, and thereafter any
remaining Prepayment Interest Shortfalls (to the extent not covered by
Compensating Interest) relating to the Mortgage Loans for any Distribution Date
shall be allocated among REMIC I Regular ▇▇▇▇▇▇▇▇▇ ▇▇-▇▇, ▇▇-▇▇, ▇▇-▇▇, LT-A3,
LT-M1, ▇▇-▇▇, ▇▇-▇▇, ▇▇-▇▇ and LT-ZZ, pro rata based on, and to the extent of,
Uncertificated Accrued Interest, as calculated without application of this
sentence.
"UNCERTIFICATED PRINCIPAL BALANCE": The principal amount of
any Uncertificated Regular Interest outstanding as of any date of determination.
The Uncertificated Principal Balance of each Uncertificated Regular Interest
shall be reduced by all distributions of principal made on such Uncertificated
Regular Interest, as applicable, on such Distribution Date and, if and to the
extent necessary and appropriate, shall be further reduced in such Distribution
Date by Realized Losses. The Uncertificated Principal Balance of each
Uncertificated Regular Interest shall never be less than zero.
"UNCERTIFICATED REMIC I PASS-THROUGH RATE": With respect to
any Distribution Date, a per annum rate equal to the Adjusted WAC Rate.
"UNCERTIFICATED REGULAR INTERESTS": The REMIC I Regular
Interests.
"UNDERWRITER ": ▇▇▇▇▇▇▇, ▇▇▇▇▇ & Co., in its capacity as
Underwriter under the Underwriting Agreement, dated as of January 29, 2003,
between the Depositor and the Underwriter.
44
"UNITED STATES PERSON": A citizen or resident of the United
States, a corporation, partnership or other entity created or organized in, or
under the laws of, the United States or any political subdivision thereof
(except, in the case of a partnership, to the extent provided in regulations)
provided that, for purposes solely of the restrictions on the transfer of any
Class R Certificate, no partnership or other entity treated as a partnership for
United States federal income tax purposes shall be treated as a United States
Person unless all persons that own an interest in such partnership either
directly or through any entity that is not a corporation for United States
federal income tax purposes are required to be United States Persons, or an
estate whose income is subject to United States federal income tax regardless of
its source, or a trust if a court within the United States is able to exercise
primary supervision over the administration of the trust and one or more United
States persons have the authority to control all substantial decisions of the
trust. To the extent prescribed in regulations by the Secretary of the Treasury,
which have not yet been issued, a trust which was in existence on August 20,
1996 (other than a trust treated as owned by the grantor under subpart E of part
I of subchapter J of chapter I of the Code), and which was treated as a United
States person on August 20, 1996 may elect to continue to be treated as a United
States person notwithstanding the previous sentence. The term "United States"
shall have the meaning set forth in Section 7701 of the Code.
"WAC CAP": As to any Distribution Date and (i) the Class A
Certificates, the Adjusted WAC Rate minus the Certificate Insurer Premium
Percentage and (ii) the Class M-1 and Class B Certificates, the Adjusted WAC
Rate.
"▇▇▇▇▇ FARGO" ▇▇▇▇▇ Fargo Home Mortgage, Inc.
"▇▇▇▇▇ FARGO SALE AGREEMENTS": Shall mean (a) the Mortgage
Loan Purchase Agreement, dated as of June 24, 2002, between the ▇▇▇▇▇▇▇ ▇▇▇▇▇
Mortgage Company and ▇▇▇▇▇ Fargo and (b) the Mortgage Loan Purchase Agreement,
dated as of August 15, 2002, between the ▇▇▇▇▇▇▇ ▇▇▇▇▇ Mortgage Company and
▇▇▇▇▇ Fargo.
"WILSHIRE CUSTODIAL AGREEMENT": The Custody Agreement dated as
of January 1, 2003 among the Trust, Wilshire and the Custodian.
"WILSHIRE MORTGAGE LOANS": The Mortgage Loans included in
Schedule I that are serviced by Wilshire pursuant to this Agreement.
"WILSHIRE TERMINATION TRIGGER EVENT": A Wilshire Termination
Trigger Event shall occur if on any date of determination (i) the Three-Month
Rolling Average Sixty-Day Delinquency Rate of the Wilshire Mortgage Loans
exceeds 18% of the aggregate Stated Principal Balance of the Wilshire Mortgage
Loans or (ii) the quotient (expressed as a percentage) of (x) the aggregate
amount of Realized Losses incurred on the Wilshire Mortgage Loans since the
Cut-off Date through the last day of the related Collection Period divided by
(y) the aggregate Stated Principal Balance of the Wilshire Mortgage Loans as of
the Cut-off Date, exceeds the applicable percentages set forth below with
respect to such Distribution Date:
45
DISTRIBUTION DATE OCCURRING IN LOSS PERCENTAGE
------------------------------ ---------------
February 2006 through January 2007 5.175% for the first month, plus an additional
1/12th of 2.250% for each month thereafter, to
7.425%
February 2007 through January 2008 7.425% for the first month, plus an additional
1/12th of 1.125% for each month thereafter, to
8.550%
February 2008 through January 2009 8.550% for the first month, plus an additional
1/12th of 1.125% for each month thereafter, to
9.675%
February 2009 and thereafter 9.675%
1.02 USE OF WORDS AND PHRASESThe terms "herein," "hereby,"
"hereunder," "hereof," "hereinbefore," "hereinafter" and other equivalent words
refer to this Agreement as a whole and not solely to the particular section of
this Agreement in which any such word is used. The definitions set forth in
SECTION 1.01 include both the singular and the plural. Whenever used in this
Agreement, any pronoun shall be deemed to include both singular and plural and
to cover all genders.
1.03 CAPTIONS; TABLE OF CONTENTS.
The captions or headings in this Agreement and the Table of
Contents are for convenience only and in no way define, limit or describe the
scope and intent of any provisions of this Agreement.
1.04 OPINIONS.
Each opinion with respect to the validity, binding nature and
enforceability of documents or Certificates may be qualified to the extent that
the same may be limited by applicable bankruptcy, insolvency, reorganization,
moratorium or other similar laws affecting the enforcement of creditors' rights
generally and by general principles of equity (whether considered in a
proceeding or action in equity or at law) and may state that no opinion is
expressed on the availability of the remedy of specific enforcement, injunctive
relief or any other equitable remedy. Any opinion required to be furnished by
any Person hereunder must be delivered by counsel upon whose opinion the
addressee of such opinion may reasonably rely, and such opinion may state that
it is given in reasonable reliance upon an opinion of another, a copy of which
must be attached, concerning the laws of a foreign jurisdiction.
1.05 ALLOCATION OF CERTAIN INTEREST SHORTFALLS.
46
For purposes of calculating the amount of Accrued
Certificate Interest for the Class A Certificates, the Class M-1 Certificates,
the Class B Certificates and the Class X Certificates for any Distribution Date,
(1) the aggregate amount of any Compensating Interest Shortfalls and any Relief
Act Shortfalls incurred in respect of the Mortgage Loans for any Distribution
Date shall be allocated first, to the Class X Certificates based on, and to the
extent of, one month's interest at the then applicable respective Pass-Through
Rate and, thereafter, among the Class B-3 Certificates, Class B-2 Certificates,
the Class B-1 Certificates, the Class M-1 Certificates and the Class A
Certificates, in that order, in each case on a pro rata basis based on, and to
the extent of, one month's interest at the then applicable respective
Pass-Through Rate on the respective Certificate Balance of each such Certificate
and (2) the aggregate amount of any Realized Losses allocated to the
Certificates and Basis Risk Carry Forward Amounts paid to the Class A
Certificates, the Class M-1 Certificates and the Class B Certificates incurred
for any Distribution Date shall be allocated to the Class X Certificates on a
pro rata basis based on, and to the extent of, one month's interest at the then
applicable Pass-Through Rate.
For purposes of calculating the amount of Uncertificated
Accrued Interest for the REMIC II Regular Interests for any Distribution Date,
the aggregate amount of any Prepayment Interest Shortfalls and any Relief Act
Shortfalls incurred in respect of the Mortgage Loans for any Distribution Date
shall be allocated as provided in Section 7.07(b) hereof.
47
ARTICLE II
ESTABLISHMENT AND ORGANIZATION OF THE TRUST
2.01 ESTABLISHMENT OF THE TRUST.
The parties hereto do hereby create and establish, pursuant to
the laws of the State of New York and this Agreement, the Trust, which, for
convenience, shall be known as "GSRPM MORTGAGE LOAN TRUST 2003-1."
2.02 OFFICE.
The office of the Trust shall be in care of the Trustee, at
the Corporate Trust Office, or at such other address as the Trustee may
designate by notice to the Depositor and the Servicers.
2.03 PURPOSES AND POWERS.
The purpose of the Trust is to engage in the following
activities and only such activities: (i) the issuance of the Certificates, the
REMIC I Regular Interests, the Class R-I Interest and the Class R-II Interests
and the acquiring, owning and holding of Mortgage Loans and the Trust Estate in
connection therewith; (ii) activities that are necessary, suitable or convenient
to accomplish the foregoing or are incidental thereto or connected therewith,
including the investment of moneys in accordance with this Agreement; and (iii)
such other activities as may be required in connection with conservation of the
Trust Estate and distributions to the Owners; PROVIDED, HOWEVER, that nothing
contained herein shall permit the Trustee to take any action which would
adversely affect the status of any Trust REMIC as a REMIC.
2.04 APPOINTMENT OF THE TRUSTEE; DECLARATION OF TRUST.
The Depositor hereby appoints the Trustee, as trustee of the
Trust effective as of the Closing Date, to have all the rights, powers and
duties set forth herein. The Trustee hereby acknowledges and accepts such
appointment, represents and warrants its eligibility as of the Closing Date to
serve as trustee pursuant to SECTION 11.07 and declares that it will hold the
Trust Estate in trust upon and subject to the conditions set forth herein for
the benefit of the Owners and the Certificate Insurer.
2.05 EXPENSES OF THE TRUST.
Such expenses of the Trust as are authorized to be paid
hereunder, including (i) the Trustee Fee and (ii) all amounts owing to the
Trustee on account of reimbursement of unanticipated out-of-pocket expenses and
any indemnification owed to the Trustee (the amounts in this clause (ii),
"SENIOR TRUSTEE EXPENSES") and the
48
Certificate Insurer Premium shall be paid out of the Certificate Account in the
priority set forth in SECTION 7.06(B)(I). The Trustee shall not be permitted to
be reimbursed for any third-party expenses, other than as set forth in the
preceding sentence, incurred by it for any custodial services required to be
performed by it hereunder.
2.06 OWNERSHIP OF THE TRUST.
On the Closing Date, the ownership interests in the Trust
shall be transferred as set forth in SECTION 4.02, such transfer to be evidenced
by sale of the Certificates as described in SECTION 4.02. Thereafter, transfer
of any ownership interest shall be governed by Article V of this Agreement.
2.07 SITUS OF THE TRUST.
It is the intention of the parties hereto that the Trust
constitute a trust under the laws of the State of New York. The Trust will be
created and administered in, and all Accounts maintained by the Trustee on
behalf of the Trust will be located in, the State of New York. The Trust will
not have any employees and will not have any real or personal property (other
than such real or personal property acquired pursuant to SECTION 8.10) located
in any state other than in the State of New York and payments will be received
by the Trustee only in the State of New York and payments from the Trustee will
be made only from the State of New York.
2.08 RESERVED.
2.09 THE CERTIFICATES.
Each Class of Certificates, other than the Class R
Certificates, will consist of a unit comprising a REMIC II Regular Certificate
(which will be designated as a regular interest).
2.10 INDEMNIFICATION WITH RESPECT TO CERTAIN TAXES AND LOSS OF
REMIC STATUS.
(a) In the event that either of REMIC I or REMIC II fails to
qualify as a REMIC, loses its status as a REMIC, or incurs state or
local taxes, or a tax as a result of a Prohibited Transaction or
contribution subject to taxation under the REMIC Provisions due to the
willful misfeasance, bad faith or negligent performance by the Trustee
of its duties and obligations specifically set forth herein, or by
reason of the Trustee's reckless disregard of its obligations and
duties hereunder, the Trustee shall indemnify the Trust against any and
all losses, claims, damages, liabilities or expenses ("LOSSES")
resulting therefrom; PROVIDED, HOWEVER, that the Trustee shall not be
liable for any such Losses or portion thereof attributable to the
action or inaction of any relevant Servicer, the Depositor, or the
Holders of the Residual Certificates nor for any such Losses or portion
thereof resulting from misinformation provided by the Holders of the
Residual Certificates, any relevant Servicer, or the Depositor, on
which the Trustee has
49
relied. The foregoing shall not be deemed to limit or restrict the
rights and remedies of successor Holders of the Residual Certificates
at law or in equity.
(b) In the event that either of REMIC I or REMIC II fails to
qualify as a REMIC, loses its status as a REMIC, or incurs state or
local taxes, or a tax as a result of a prohibited transaction or
contribution subject to taxation under the REMIC Provisions due to the
willful misfeasance, bad faith or negligent performance of the relevant
Servicer in the performance of its duties and obligations set forth
herein, or by reason of such Servicer's reckless disregard of its
obligations and duties thereunder, such Servicer shall indemnify the
Trust against any and all Losses resulting therefrom; PROVIDED,
HOWEVER, that such Servicer shall not be liable for any such Losses
attributable to the action or inaction of the Trustee, the Depositor,
the Holder of the Residual Certificates nor for any such Losses
resulting from misinformation provided by the Trustee, the Depositor or
the Holder of the Residual Certificates on which such Servicer
reasonably has relied. The foregoing shall not be deemed to limit or
restrict the rights and remedies of any successor Holder of the
Residual Certificates at law or in equity.
ARTICLE III
REPRESENTATIONS, WARRANTIES AND COVENANTS OF THE DEPOSITOR
AND THE SERVICERS; REMEDIES UPON BREACHES
3.01 REPRESENTATIONS AND WARRANTIES OF THE DEPOSITOR.
The Depositor hereby represents, warrants and covenants to the
Trustee, the Servicers, the Certificate Insurer and the Owners that as of the
Closing Date:
(a) The Depositor is a corporation duly organized, validly
existing and in good standing under the law of the State of Delaware.
The Depositor has the power and authority to execute, deliver and
perform its obligations under this Agreement and to enter into the
transactions contemplated hereby under the laws of the State of
Delaware.
(b) The execution and delivery by the Depositor of this
Agreement and the other Operative Documents to which it is a party and
the performance and compliance with the terms hereof and thereof by the
Depositor have been duly authorized by all required action on the part
of the Depositor and will not violate the Depositor's constitutive
documents or constitute a default (or an event which, with notice or
lapse of time, or both, would constitute a default) under, or result in
a breach of, any material contract, agreement or other instrument to
which the Depositor is a party or by which the Depositor is bound or
violate any statute or
50
any order, rule or regulation of any court, governmental agency or body
or other tribunal having jurisdiction over the Depositor or any of its
properties.
(c) This Agreement and the other Operative Documents to which
the Depositor is a party, assuming due authorization, execution and
delivery by the other parties hereto and thereto, each constitutes a
valid, legal and binding obligation of the Depositor, enforceable
against it in accordance with the terms hereof and thereof, except as
the enforcement thereof may be limited by applicable bankruptcy,
insolvency, reorganization, moratorium or other similar laws affecting
creditors' rights generally and by general principles of equity
(whether considered in a proceeding or action in equity or at law).
(d) The Depositor is not in default with respect to any order
or decree of any court or any order, regulation or demand of any
federal, state, municipal or governmental agency, which default would
materially and adversely affect the condition (financial or other) or
operations of the Depositor or its properties or the consequences of
which would materially and adversely affect its performance hereunder
or under the other Operative Documents to which the Depositor is a
party.
(e) No litigation is pending with respect to which the
Depositor has received service of process or, to the best of the
Depositor's knowledge, threatened against the Depositor which
litigation might have consequences that would prohibit its entering
into this Agreement or any other Operative Documents to which it is a
party or that would materially and adversely affect the condition
(financial or otherwise) or operations of the Depositor or its
properties or might have consequences that would materially and
adversely affect its performance hereunder and under the other
Operative Documents to which the Depositor is a party.
(f) No certificate of an officer, statement furnished in
writing or report delivered pursuant to the terms hereof by the
Depositor contains any untrue statement of a material fact or omits to
state any material fact necessary to make the certificate, statement or
report not misleading.
(g) All actions, approvals, consents, waivers, exemptions,
variances, franchises, orders, permits, authorizations, rights and
licenses required to be taken, given or obtained, as the case may be,
by or from any federal, state or other governmental authority or agency
(other than any such actions, approvals, etc. under any state
securities laws, real estate syndication or "Blue Sky" statutes, as to
which the Depositor makes no such representation or warranty), that are
necessary or advisable in connection with the purchase and sale of the
Certificates and the execution and delivery by the Depositor of the
Operative Documents to which it is a party, have been duly taken, given
or obtained, as the case may be, are in full force and effect on the
date hereof, are not subject to any pending proceedings or appeals
(administrative, judicial or otherwise) and either the time
51
within which any appeal therefrom may be taken or review thereof may be
obtained has expired or no review thereof may be obtained or appeal
therefrom taken, and are adequate to authorize the consummation of the
transactions contemplated by this Agreement and the other Operative
Documents on the part of the Depositor and the performance by the
Depositor of its obligations under this Agreement and such of the other
Operative Documents to which it is a party.
(h) Immediately prior to the sale, assignment, transfer and
conveyance described in SECTION 3.04(A)(I), the Depositor will hold
good title to, and be the sole owner of, the Mortgage Loans referred to
therein free and clear of any liens, charges, mortgages, encumbrances
or rights of others (other than liens which will be simultaneously
released).
(i) The Depositor has valid business reasons for entering into
the transactions contemplated by this Agreement (including, without
limitation, the sale of its interests in the Mortgage Loans and other
assets in the Trust Estate to the Trustee).
(j) The Depositor is not insolvent, nor will it be made
insolvent by the transfer of the Mortgage Loans and other assets in the
Trust Estate, nor is the Depositor aware of any pending insolvency.
(k) The sale, assignment, transfer and conveyance of the
Mortgage Notes and the Mortgages by the Depositor hereunder are not
subject to the bulk transfer laws or any similar statutory provisions
in effect in any applicable jurisdiction.
(l) The Depositor is not transferring the Mortgage Loans and
other assets in the Trust Estate to the Trustee with any intent to
hinder, delay or defraud its creditors.
(m) The Depositor received fair consideration and reasonably
equivalent value in exchange for the sale, assignment, transfer and
conveyance of its interests in the Mortgage Loans and other assets in
the Trust Estate to the Trustee.
It is understood and agreed that the representations and
warranties set forth in this SECTION 3.01 shall survive delivery of the
respective Mortgage Loans to the Trustee.
3.02 REPRESENTATIONS AND WARRANTIES OF THE SERVICERS.
(a) Fairbanks hereby represents, warrants and covenants to the
Trustee, Wilshire, the Depositor, the Certificate Insurer and the
Owners that as of the Closing Date:
(i) Fairbanks is a corporation duly organized, validly
existing, and in good standing under the laws of the State of Utah and
is in compliance with the
52
laws of each state in which any Mortgaged Property related to a
Fairbanks Mortgage Loan is located to the extent necessary to ensure,
in its role as a Servicer, the enforceability of each Fairbanks
Mortgage Loan and to perform its obligations hereunder.
(ii) Neither the execution and delivery by Fairbanks of this
Agreement, nor the consummation by it of the transactions contemplated
hereby, nor the performance of and compliance by Fairbanks with the
provisions hereof, will conflict with or result in a breach or
violation of, or constitute a default (or an event which, with notice
or the lapse of time, or both, would constitute a default) under, the
organizational documents (its charter and by-laws) of Fairbanks, or any
of the provisions of any Law binding on Fairbanks, or any of its
properties, or any of the provisions of any indenture, mortgage,
contract, instrument, or other document to which Fairbanks is a party
or by which it is bound, or result in the creation or imposition of any
lien, charge, or encumbrance upon any of its respective properties
pursuant to the terms of any indenture, mortgage, contract, instrument,
or other document. Fairbanks is not otherwise in violation of any Law,
which violation, in Fairbanks's good faith and reasonable judgment, is
likely to affect materially and adversely either its ability to perform
its obligations hereunder, or the financial condition of Fairbanks.
(iii) The execution and delivery by Fairbanks of this
Agreement, the consummation of the transactions contemplated hereby,
and the performance and compliance by Fairbanks with the terms hereof
are within the powers of Fairbanks, and have been duly authorized by
all necessary action on the part of Fairbanks. This Agreement has been
duly executed and delivered by Fairbanks and, upon the due execution,
authorization and delivery by the other parties hereto, constitutes the
legal, valid and binding obligation of Fairbanks, enforceable against
it in accordance with its terms, subject to applicable bankruptcy,
insolvency, reorganization, moratorium, and other similar laws
affecting creditors' rights generally, and to general principles of
equity, regardless of whether such enforcement is considered in a
proceeding in equity or at law. Fairbanks has obtained all consents,
approvals, authorizations, or orders, and made all registrations or
qualifications with, any court or regulatory authority or other
governmental body having jurisdiction over Fairbanks, which consent,
approval, authorization, order, registration, or qualification is
required for, and the absence of which would materially and adversely
affect, the legal and valid execution, delivery, and performance of
this Agreement by Fairbanks.
(iv) Fairbanks possesses such certificates, authorizations,
licenses, and permits issued by the appropriate state, federal, and
foreign regulatory agencies or bodies necessary to conduct the business
now operated by it, except to the extent that the failure of Fairbanks
to possess any such certificate, authorization, license or permit would
not have a material adverse effect on the ability of Fairbanks to
perform its obligations hereunder.
53
(v) No litigation is pending or, to the best of Fairbanks's
knowledge, threatened against it, which, if determined adversely to
Fairbanks would prohibit Fairbanks from entering into this Agreement
or, in the good faith and reasonable judgment of Fairbanks, is likely
to materially and adversely affect either its ability to perform its
obligations hereunder or the financial condition of Fairbanks.
Fairbanks has no knowledge of any recent adverse financial condition or
event with respect to itself that, in its good faith and reasonable
judgment, is likely to materially and adversely affect its ability to
perform its obligations hereunder.
(vi) Each officer, director, employee, consultant and advisor
of Fairbanks with responsibilities concerning the servicing and
administration of the Fairbanks Mortgage Loans is covered by errors and
omissions insurance and fidelity bond insurance in the amounts and with
coverage consistent with Accepted Servicing Practices. Neither
Fairbanks nor any of its officers, directors, employees, consultants,
or advisors involved in the servicing or administration of the
Fairbanks Mortgage Loans has been refused such coverage or insurance.
(vii) Fairbanks is an entity that engages in the business of
originating, acquiring or servicing mortgage loans, and is authorized
to transact business in the state or states where the related mortgaged
properties it is to service are situated and is a ▇▇▇▇▇▇ ▇▇▇-approved
mortgage seller-servicer and/or a ▇▇▇▇▇▇▇ Mac-approved mortgage
servicer for first and second mortgage loans (to the extent ▇▇▇▇▇▇ ▇▇▇
and/or ▇▇▇▇▇▇▇ Mac approval is required under applicable Law). In
addition, Fairbanks will obtain and preserve its qualification to do
business as a foreign corporation in each jurisdiction in which such
qualification is or shall be necessary to protect the validity and
enforceability of the Fairbanks Mortgage Loans or this Agreement, and
to perform its duties hereunder. Fairbanks meets the equity and other
eligibility requirements consistent with Accepted Servicing Practices.
(b) Wilshire hereby represents, warrants and covenants to the
Trustee, the Depositor, Fairbanks, the Certificate Insurer and the Owners that
as of the Closing Date:
(i) Wilshire is a corporation duly organized, validly
existing, and in good standing under the laws of the State of Nevada
and is in compliance with the laws of each state in which any Mortgaged
Property related to a Wilshire Mortgage Loan is located to the extent
necessary to ensure, in its role as a Servicer, the enforceability of
each Wilshire Mortgage Loan and to perform its obligations hereunder.
(ii) Neither the execution and delivery by Wilshire of this
Agreement, nor the consummation by it of the transactions contemplated
hereby, nor the performance of and compliance by Wilshire with the
provisions hereof, will conflict with or result in a breach or
violation of, or constitute a default (or an event which, with notice
or the lapse of time, or both, would constitute a default)
54
under, the organizational documents (its charter and by-laws) of
Wilshire, or any of the provisions of any Law binding on Wilshire, or
any of its properties, or any of the provisions of any indenture,
mortgage, contract, instrument, or other document to which Wilshire is
a party or by which it is bound, or result in the creation or
imposition of any lien, charge, or encumbrance upon any of its
respective properties pursuant to the terms of any indenture, mortgage,
contract, instrument, or other document. Wilshire is not otherwise in
violation of any Law, which violation, in Wilshire's good faith and
reasonable judgment, is likely to affect materially and adversely
either its ability to perform its obligations hereunder, or the
financial condition of Wilshire.
(iii) The execution and delivery by Wilshire of this
Agreement, the consummation of the transactions contemplated hereby,
and the performance and compliance by Wilshire with the terms hereof
are within the powers of Wilshire, and have been duly authorized by all
necessary action on the part of Wilshire. This Agreement has been duly
executed and delivered by Wilshire and, upon the due execution,
authorization and delivery by the other parties hereto, constitutes the
legal, valid and binding obligation of Wilshire, enforceable against it
in accordance with its terms, subject to applicable bankruptcy,
insolvency, reorganization, moratorium, and other similar laws
affecting creditors' rights generally, and to general principles of
equity, regardless of whether such enforcement is considered in a
proceeding in equity or at law. Wilshire has obtained all consents,
approvals, authorizations, or orders, and made all registrations or
qualifications with, any court or regulatory authority or other
governmental body having jurisdiction over Wilshire, which consent,
approval, authorization, order, registration, or qualification is
required for, and the absence of which would materially and adversely
affect, the legal and valid execution, delivery, and performance of
this Agreement by Wilshire.
(iv) Wilshire possesses such certificates, authorizations,
licenses, and permits issued by the appropriate state, federal, and
foreign regulatory agencies or bodies necessary to conduct the business
now operated by it, except to the extent that the failure of Wilshire
to possess any such certificate, authorization, license or permit would
not have a material adverse effect on the ability of Wilshire to
perform its obligations hereunder.
(v) Except as disclosed on the 10Q of Wilshire Financial
Services Group Inc., no litigation is pending or, to the best of
Wilshire's knowledge, threatened against it, which, if determined
adversely to Wilshire would prohibit Wilshire from entering into this
Agreement or, in the good faith and reasonable judgment of Wilshire, is
likely to materially and adversely affect either its ability to perform
its obligations hereunder or the financial condition of Wilshire.
Wilshire has no knowledge of any recent adverse financial condition or
event with respect to itself that, in its good faith and reasonable
judgment, is likely to materially and adversely affect its ability to
perform its obligations hereunder.
55
(vi) Each officer, director, employee, consultant and advisor
of Wilshire with responsibilities concerning the servicing and
administration of the Wilshire Mortgage Loans is covered by errors and
omissions insurance and fidelity bond insurance in the amounts and with
coverage consistent with Accepted Servicing Practices. Neither Wilshire
nor any of its officers, directors, employees, consultants, or advisors
involved in the servicing or administration of the Wilshire Mortgage
Loans has been refused such coverage or insurance.
(vii) Wilshire is either (i) a depository institution the
accounts of which are insured by the FDIC or (ii) another entity that
engages in the business of originating, acquiring or servicing loans,
and in either case shall be authorized to transact business in the
state or states where the related mortgaged properties it is to service
are situated and in either case shall be a ▇▇▇▇▇▇ ▇▇▇-approved mortgage
seller-servicer and/or a ▇▇▇▇▇▇▇ Mac-approved mortgage servicer for
first and second mortgage loans (to the extent ▇▇▇▇▇▇ ▇▇▇ and/or
▇▇▇▇▇▇▇ Mac approval is required under applicable Law). In addition,
Wilshire will obtain and preserve its qualification to do business as a
foreign corporation in each jurisdiction in which such qualification is
or shall be necessary to protect the validity and enforceability of the
Wilshire Mortgage Loans or this Agreement, and to perform its duties
hereunder. Wilshire meets a $15 million equity and other eligibility
requirements consistent with Accepted Servicing Practices.
It is understood and agreed that the representations and
warranties set forth in this SECTION 3.02 shall survive delivery of the Mortgage
Loans to the Trustee.
Upon discovery by any of Fairbanks, Wilshire, the Depositor,
the Certificate Insurer, any Owner, or the Trustee (each, for purposes of this
paragraph, a party) of a breach of any of the representations and warranties set
forth in this SECTION 3.02 which materially and adversely affects the interests
of the Owners, the party discovering such breach shall give prompt written
notice to the other parties. Within ninety (90) days of its discovery or its
receipt of notice of breach, which ever is earlier, Fairbanks or Wilshire, as
the case may be, shall cure such breach in all material respects and, upon such
Servicer's continued failure to cure such breach, may thereafter be removed by
the Trustee pursuant to SECTION 8.17.
3.03 REMEDIES UPON BREACH OF REPRESENTATIONS AND WARRANTIES BY
THE DEPOSITOR OR A SELLER.
(a) BREACH BY DEPOSITOR. Upon discovery by any of the
Depositor, any Servicer, any Owner, the Certificate Insurer or the
Trustee (each, for purposes of this paragraph, a "PARTY") of a breach
of any of the representations and warranties set forth in SECTION 3.01
or any of the representations and warranties made by the Depositor
pursuant to Section 4 of the Sale and Warranties Agreement, which
materially and adversely affects the interests of the Owners, the party
discovering such breach shall give prompt written notice to the other
parties. Within ninety (90) days of its discovery or its respective
receipt of notice of breach the Trustee
56
shall exercise all rights it has under this Agreement, and, to the
extent such breach also constitutes a breach of any of the
representations and warranties set forth in Section 4 of the Sale and
Warranties Agreement or any covenant set forth therein, the Trustee
shall exercise all rights it would otherwise have available against
▇▇▇▇▇▇▇ ▇▇▇▇▇ Mortgage Company under Section 5(b) and 5(c) of the Sale
and Warranties Agreement against the Depositor as if set forth under
this Section 3.03 with respect to the Depositor.
(b) BREACH BY SELLER. Upon discovery by any of the Depositor,
any Servicer, any Owner, the Certificate Insurer or the Trustee (each,
for purposes of this paragraph, a "PARTY") of a breach by any Seller of
any of the representations and warranties set forth in Sections 3 or 4
of the relevant Sale Agreement, or any covenant set forth in any Sale
Agreement, which materially and adversely affects the interests of the
Owners or the Certificate Insurer, the party discovering such breach
shall give prompt written notice to the other parties. In the case of
▇▇▇▇▇ Fargo, within ninety (90) days of its discovery or its receipt of
notice of breach (or seventy-five (75) days if such breach constitutes
a Qualification Defect as defined in the ▇▇▇▇▇ Fargo Sale Agreements)
and with respect to Household within thirty (30) days of discovery or
notice of a breach of a representation or warranty in Section 4 of the
Household Sale Agreement and subject to any additional grace period
provided for by the applicable Sale Agreement if certain conditions are
met, (1) the Trustee, as assignee of all of the rights and interest of
the Depositor in each Sale Agreement, shall take such action as shall
be necessary to collect Indemnity Proceeds from the applicable Seller,
and to enforce and prosecute any and all other rights of the Depositor
and its assignees under each Sale Agreement, which rights shall include
causing the applicable Seller to repurchase the relevant Mortgage Loans
in accordance with the terms of the applicable Sale Agreement and remit
the Loan Purchase Price to the relevant Servicer for deposit in the
related Collection Account, and (2) the Majority Class X
Certificateholder, at its sole discretion, may on the next succeeding
Remittance Date purchase such Mortgage Loan from the Trust at the Loan
Purchase Price, which purchase price shall be delivered to the relevant
Servicer for deposit in the applicable Collection Account. However, any
such purchase at the option of the Majority Class X Certificateholder
must occur within 90 days of the date of the Trustee's notice of the
defect if the defect would prevent the Mortgage Loan from being a
Qualified Mortgage, and no purchase of a Mortgage Loan that is not in
default or for which no default is imminent shall be made unless the
Majority Class X Certificateholder obtains for the Trustee and the
Certificate Insurer a written opinion of independent counsel to the
effect that such contemplated action is in compliance with the
provisions of the Code relating to REMICs, is not a "prohibited
transaction" within the meaning of Code Section 860F(a)(2) and will not
prevent either Trust REMIC from qualifying as a REMIC addressed to and
acceptable to the Trustee. In the event the Majority Class X
Certificateholder purchases a Mortgage Loan pursuant to the second
preceding sentence, it shall be subrogated to the rights of the Trust
against the applicable Seller in respect of the applicable breach of
representation or warranty, other than rights to receive
57
Indemnity Proceeds in respect of damages incurred by the Trust during
the period when the Trust held the Mortgage Loan, which rights shall
specifically be retained by the Trust. The Trustee shall execute and
deliver to the Majority Class X Certificateholder such instruments
delivered to the Trustee for execution as it may reasonably request in
order to further the purposes of the preceding sentence.
(c) In the event that any action taken by the Depositor
pursuant to paragraph (a) above results in a Prohibited Transaction
tax, the Trustee shall immediately notify the Depositor in writing
thereof and the Depositor will, within 10 days of receiving notice
thereof from the Trustee, deposit the amount due from the Trust with
respect to such tax with the Trustee for the payment thereof, including
any interest and penalties, in immediately available funds.
(d) Without limiting its obligation to enforce each Sale
Agreement in accordance with their respective terms, the Trustee shall
have no duty to conduct any affirmative investigation other than as
specifically set forth in this Agreement as to the occurrence of any
condition permitting the repurchase of any Mortgage Loan by the
Depositor pursuant to this Article III or the eligibility of any
Mortgage Loan for the purpose of this Agreement.
3.04 CONVEYANCE OF THE MORTGAGE LOANS.
(a) (i) On the Closing Date, pursuant to the "CONVEYANCE"
clause on the first page hereof, the Depositor, concurrently with the
execution and delivery hereof, hereby sells, transfers, assigns, sets
over and otherwise conveys to the Trustee on behalf of the Trust,
without recourse (except as otherwise provided herein), all of its
right, title and interest of every kind and nature whatsoever, whether
now owned and existing or hereafter acquired or arising, in and to
property constituting the Trust Estate. The transfer by the Depositor
of the Mortgage Loans set forth on the Schedule of Mortgage Loans and
the other assets in the Trust Estate to the Trustee is absolute and is
intended by the Owners and all parties hereto to be treated as a sale
by the Depositor for all purposes (including tax, reporting and
accounting purposes).
(ii) It is the express intent of the parties that the transfer
and conveyance of the Trust Estate constitute a sale of the Mortgage
Loans and other assets in the Trust Estate conveying good title thereto
free and clear of any liens and encumbrances from the Depositor to the
Trustee on behalf of the Trust and that the Mortgage Loans and other
assets in the Trust Estate not be part of the Depositor's estate in the
event of bankruptcy or insolvency or otherwise. However, in the event
and to the extent that, notwithstanding the intent of the parties
hereto, any or all of the Mortgage Loans and other assets in the Trust
Estate conveyed by the Depositor to the Trustee on behalf of the Trust
hereunder are held or otherwise determined to have been property of the
Depositor or not to have been conveyed to the Trustee in an absolute
sale, then (i) this Agreement shall also be deemed to be, and hereby
constitutes, a security agreement within
58
the meaning of Article 9 of the UCC; (ii) the conveyance hereunder by
the Depositor of the Mortgage Loans set forth on the Schedule of
Mortgage Loans and the other assets in the Trust Estate shall be deemed
to be, and hereby constitutes, a grant by the Depositor to the Trustee
of a first priority security interest in all of the Depositor's right,
title and interest in and to such Mortgage Loans and other assets;
(iii) the possession by the Trustee or any of its bailees or agents of
items of property that constitute goods, instruments, money, negotiable
documents or chattel paper shall be deemed to be "possession by the
secured party" for purposes of perfecting the security interest
pursuant to Section 9-313 of the UCC; (iv) notifications to persons
holding such property, and acknowledgments, receipts or confirmations
from persons holding such property, shall be deemed notifications to,
or acknowledgments, receipts or confirmations from, financial
intermediaries, bailees or agents (as applicable) of the Trustee for
the purpose of perfecting such security interest under applicable law;
and (v) the obligations secured by the first priority security interest
described in clause (ii) above shall be deemed to include any and all
obligations of the Depositor to the Trustee and any and all obligations
of the Trustee to the Owners and other Persons pursuant to this
Agreement and the other Operative Documents, including any obligation
to remit the principal of and interest on the Certificates to the
Owners as and when due and any obligation to distribute or remit any
other fees, costs, expenses and other amounts required to be
distributed or paid under this Agreement or any of the other Operative
Documents. Any assignment or other transfer of the rights of the
Trustee under any provision hereof shall also be deemed to be an
assignment of any security interest created hereby. The Depositor
covenants that, to the extent consistent with this Agreement, it will
take such actions as may be necessary to ensure that, if this Agreement
were deemed to create a security interest in the Mortgage Loans, such
security interest would be deemed to be a perfected security interest
of first priority under applicable law and would be maintained as such
throughout the terms of this Agreement and the other Operative
Documents. The Depositor also covenants not to pledge, assign or grant
a security interest in any of the Mortgage Loans to any third party.
(b) In connection with the transfer and assignment of the
Mortgage Loans (other than the Contracts), the Depositor agrees to
deliver, or cause to be delivered, without recourse to the Custodian on
the Closing Date with respect to each such Mortgage Loan:
(i) The original Mortgage Note endorsed, "Pay to the order of
[ ] without recourse" and signed in the name of the last endorsee by an
authorized officer; or in the case of a missing Mortgage Note, a Lost
Note Affidavit in blank together with a true and correct copy of the
original Mortgage Note; PROVIDED, HOWEVER, that a Lost Note Affidavit
may be delivered with respect to no more than five percent (5%) of the
Mortgage Loans (by Principal Balance). The Mortgage Note shall include
all intervening original endorsements showing a complete chain of title
from the originator to the last endorsee;
59
(ii) To the extent executed in connection with the related
Mortgage Loan, an original power of attorney, or photocopy thereof
certified by a Governmental Authority with evidence of recording noted
thereon if recordation is required to maintain the lien of the Mortgage
or if the document to which such power of attorney relates is required
to be recorded, or if recordation is not so required, the original, a
certified photocopy or a photocopy of such certified photocopy of any
such power of attorney;
(iii) To the extent executed in connection with the related
Mortgage Loan, the original or a photocopy of any personal endorsement
or guaranty agreement;
(iv) The original or a photocopy of the original recorded
Mortgage (together with a standard adjustable rate mortgage rider, if
the Mortgage Loan is an Adjustable Rate Mortgage Loan), with evidence
of recording thereon; PROVIDED, HOWEVER, if the original recorded
Mortgage is not available because it has been delivered to the
applicable recording office, the Depositor shall deliver a legible
photocopy of the Mortgage pending recording, certified by the Seller,
in lieu of the original recorded Mortgage, and evidence of recording
shall be provided in case of any and all original Mortgages or
photocopies thereof certified by the Seller; PROVIDED, FURTHER, if the
original Mortgage is available but has not been recorded, the Seller
shall deliver a legible photocopy of the original Mortgage, certified
by the Seller as a true and correct copy of the original Mortgage (or a
photocopy of such certified copy), and shall promptly record such
Mortgage in the applicable recording office at the expense of the
Depositor;
(v) Except with respect to each MERS Designated Mortgage Loan,
the original executed assignment of each Mortgage from the Seller, in
blank, which assignment shall be in form and substance acceptable for
recording. In the event that the Mortgage Loan was acquired by the
Seller in a merger or in the event that the Mortgage Loan was acquired
or originated by the Seller while doing business under another name,
the assignment must be by "[Seller Name], successor in interest to
[name of originator or other entity to which the Mortgage has been
assigned]" or "[Seller Name], successor in interest to [name of
originator or other entity to which the Mortgage Note was endorsed]",
as the case may be;
(vi) The original policy of title insurance or a copy thereof,
if any (or a preliminary title report, binder or other material
described on Exhibit B or Exhibit B-1, as applicable, of the relevant
Sale Agreement if the original title insurance policy has not been
received from the title insurance company);
(vii) Originals of any intervening assignments of the
Mortgage, with evidence of recording thereon, necessary to show a
complete chain of title from the original mortgagee to the Seller (or
MERS with respect to each MERS Designated Mortgage Loan); PROVIDED,
HOWEVER, if the original recorded assignments of the Mortgage are not
available because they have been delivered to the applicable recording
office, the Depositor may deliver a legible photocopy
60
of the assignments of the Mortgage pending recording, certified by the
Seller (or a photocopy of such certified copy), in lieu of the original
recorded assignment of the Mortgage, and evidence of recording shall be
provided in case of any and all original assignments of the Mortgage or
photocopies thereof certified by the Seller; PROVIDED, FURTHER, if the
original assignments of the Mortgage are available but have not been
recorded, the Seller shall deliver a legible photocopy thereof,
certified by the Seller as a true and correct copy of the original
assignments of the Mortgage (or a photocopy of such certified copy),
and shall promptly record such assignments in the applicable recording
office at its expense; and
(viii) Originals of all assumption, modification and
substitution agreements, if any, or certified copies thereof (or a
photocopy containing the same), in either case with evidence of
recording noted thereon if recordation is required to maintain the lien
of the Mortgage or is otherwise required by applicable Law.
(c) In connection with the transfer and assignment of the
Contracts identified on the Schedule of Mortgage Loans, the Depositor
agrees to deliver, or cause to be delivered, without recourse to the
Trustee, on the Closing Date, the related Contract File and Land Home
Contract File.
(d) The parties acknowledge and agree that, after the
transfers described in subsections (A)(I) and (A)(II) of this SECTION
3.04, ownership of the entire Trust Estate (including all of the
Mortgage Loans and other assets included therein) shall be vested
solely and exclusively in the Trustee on behalf of the Trust.
Accordingly, the Depositor hereby agrees that it shall take no action
inconsistent with the Trustee's ownership, on behalf of the Trust, of
the Trust Estate and shall indicate or shall cause to be indicated in
its books and records (including any books and records held on its
behalf) that ownership of the Trust Estate (including all of the
Mortgage Loans and other assets included therein) is held by the
Trustee on behalf of the Trust. In addition, the Depositor hereby
agrees that it shall respond to any inquiries from third parties with
respect to ownership of such assets by stating that it is not the owner
of such assets and that ownership of such assets is held by the Trustee
on behalf of the Trust.
(e) If any Mortgage has been recorded in the name of MERS, no
assignment of Mortgage in favor of the Trustee will be required to be
prepared or delivered and instead, the applicable Servicer shall take
all reasonable actions as are necessary at the expense of the Depositor
to cause the Trust to be shown as the owner of the related Mortgage
Loan on the records of MERS for the purpose of the system of recording
transfers of beneficial ownership of mortgages maintained by MERS.
3.05 ACCEPTANCE BY TRUSTEE; CERTIFICATION BY TRUSTEE.
By the Closing Date, the Custodian shall review all documents
delivered to it in accordance with the provisions hereof, and shall deliver to
the Depositor, the Trustee, the Servicers and the Certificate Insurer an initial
custodial certification (the
61
"INITIAL CERTIFICATION") in the form attached as EXHIBIT F hereto. The Custodian
shall have examined each of the documents or copies thereof presented to the
Custodian in each Custodial File pursuant to the relevant Custodial Agreement.
Based upon such review, the Custodian shall determine with respect to each
Custodial File whether: (i) all documents purporting to be those instruments
described in SECTION 3.04(B)(I) though (VIII) or Section 3.04(c) and the related
reference to the Mortgage Loan in the Schedule of Mortgage Loans (and which are
determinable from an examination of the documents or copies thereof in the
Custodial File, the Contract File or the Land Home Contract File, as applicable)
are in its possession; (ii) such instruments have been reviewed by the Custodian
and appear regular on their face and are related to the Mortgage Loan
referenced; and (iii) based on its examination of the Mortgage Note, the
Mortgage and the information set forth in the Schedule of Mortgage Loans
respecting such Mortgage Loan accurately reflects the information set forth in
the documents contained in the Custodial File, the Contract File or the Land
Home Contract File, as applicable, declares that it will hold such documents and
any amendments, replacement or supplements thereto, as well as any other assets
included in the definitions of Trust Estate and delivered to the Custodian on
behalf of the Trustee, as Trustee in trust upon and subject to the conditions
set forth herein for the benefit of the Certificate Insurer and the Owners. The
Trustee agrees, for the benefit of the Owners and the Certificate Insurer, to
review or cause the Custodian to review such items within ninety (90) days after
the Closing Date (or, with respect to any document delivered after the Closing
Date, within ninety (90) days of receipt and cause the Custodian to deliver to
the Depositor, the Certificate Insurer and the applicable Servicer a
certification (a "CERTIFICATION") to the effect that, as to each Mortgage Loan
listed in the Schedule of Mortgage Loans (other than any Mortgage Loan paid in
full or any Mortgage Loan specifically identified in such Certification as not
covered by such Certification), (i) all documents or copies or images required
to be delivered to it pursuant to SECTION 3.04(B)(I) and each original Contract
are in its possession, (ii) such documents have been reviewed by it and have not
been mutilated, damaged or torn and relate to such Mortgage Loan and (iii) based
on its examination and only as to the foregoing documents, the information set
forth on the Schedule of Mortgage Loans accurately reflects the information set
forth in the Custodial File, the Contract File or the Land Home Contract File,
as applicable. Neither the Trustee nor the Custodian shall have any
responsibility for reviewing any Custodial File, Contract File or Land Home
Contract File, as applicable except as expressly provided in this SECTION
3.05(A). Without limiting the effect of the preceding sentence, in reviewing any
Custodial File, neither the Trustee nor the Custodian shall have any
responsibility for determining whether any document is valid and binding,
whether the text of any assignment is in proper form (except to determine if the
Trustee is the assignee), whether any document has been recorded in accordance
with the requirements of any applicable jurisdiction or whether a blanket
assignment is permitted in any applicable jurisdiction, but shall only be
required to determine whether a document has been executed, that it appears to
be what it purports to be, and, where applicable, that it purports to be
recorded. Neither the Trustee nor the Custodian shall be under any duty or
obligation to inspect, review or examine any such documents, instruments,
certificates or other papers to determine that they are genuine, enforceable, or
appropriate for the represented purpose or that they are other than what they
purport to be on their face, nor shall the Trustee or
62
the Custodian be under any duty to determine independently whether there are any
intervening assignments or assumption or modification agreements with respect to
any Mortgage Loan.
If the Custodian during such ninety (90) day period finds any
document constituting a part of a Custodial File which is not executed, has not
been received, or is unrelated to the Mortgage Loans identified in the Schedule
of Mortgage Loans, or that any Mortgage Loan does not conform to the description
thereof as set forth in the Schedule of Mortgage Loans, the Custodian shall be
required to promptly so notify the Trustee, the Depositor, the Certificate
Insurer, the applicable Servicer and the related Seller. In performing any such
review, the Custodian may conclusively rely as to the purported genuineness of
any such document and any signature thereon. It is understood that the scope of
the Custodian's review of the items delivered, or caused to be delivered, by the
Depositor pursuant to SECTION 3.04(B) and (c) is limited solely to confirming
that the documents listed in SECTION 3.04(B) and (c) have been executed and
received, relate to the Custodial Files identified in the Schedule of Mortgage
Loans and conform to the description thereof in the Schedule of Mortgage Loans.
The Trustee shall enforce the relevant provisions of the applicable Sale
Agreement against the related Seller in order to remedy a material defect in a
document constituting part of a Custodial File delivered, or caused to be
delivered, by the Depositor of which it is so notified. If, however, within
ninety (90) days after the Trustee's notice to it respecting such defect the
applicable Seller or the Depositor (depending on the Mortgage Loan to which such
defect relates) has not remedied the defect and the defect materially and
adversely affects the interest of the Owners and the Certificate Insurer in the
related Mortgage Loan either (i) the Trustee shall enforce and prosecute all of
the rights of the Depositor under the related Sale Agreement against the Seller
or of the Depositor under the Sale and Warranties Agreement against ▇▇▇▇▇▇▇
▇▇▇▇▇ Mortgage Company, as the case may be, and (ii) the Majority Class X
Certificateholder may, at its sole discretion, on the next succeeding Remittance
Date purchase such Mortgage Loan as set forth in SECTION 3.03(B).
In addition to the foregoing, the Trustee also agrees to cause
the Custodian to make a review during the six-month period after the Closing
Date and deliver to the Depositor, the applicable Servicer, the Trustee and the
Certificate Insurer indicating the current status of the exceptions previously
indicated on the Initial Certification (the "FINAL CERTIFICATION"). After
delivery of the Final Certification, the Trustee (and the applicable Servicer,
to the extent required by SECTION 8.03(C)) shall cause the Custodian to monitor
and upon request from the Depositor or the Certificate Insurer provide no less
frequently than monthly, updated certifications indicating the then current
status of exceptions, until all such exceptions have been eliminated.
3.06 NONQUALIFIED MORTGAGE LOAN. In the event that the Trustee
discovers that a Mortgage Loan is not a qualified Mortgage within the meaning of
the REMIC Provisions on the Closing Date, and such defect is not cured prior to
the 75th day following the discovery or receipt of notice of such failure to
qualify, Fairbanks or Wilshire, as applicable, on behalf of the Trustee shall
use reasonable efforts to cause such Fairbanks Mortgage Loan or Wilshire
Mortgage Loan, as applicable, to be sold or
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otherwise removed from the Trust on or prior to the 90th day after its initial
discovery or receipt of notice of such situation.
ARTICLE IV
ISSUANCE AND SALE OF CERTIFICATES
4.01 ISSUANCE OF CERTIFICATES.
On the Closing Date, upon the Trustee's receipt from the
Depositor of an executed authentication and delivery order, the Trustee shall
execute, authenticate and deliver the Certificates on behalf of the Trust.
4.02 SALE OF CERTIFICATES.
At 11:00 a.m. New York City time on the Closing Date (the
"CLOSING"), at the offices of ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇ & ▇▇▇▇, ▇▇ ▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇
▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇ (or at such other location acceptable to the Depositor),
the Depositor will sell and convey the Mortgage Loans and the money, instruments
and other property related thereto described in SECTION 3.04(A)(I) to the
Trustee, and the Trustee will deliver (i) to the Underwriter, the Class A
Certificates, the Class M-1 Certificates and the Class B Certificates with an
aggregate Percentage Interest in each Class equal to 100%, registered in the
name of Cede & Co., or in such other names as the Underwriter shall direct,
against payment of the purchase price thereof by wire transfer of immediately
available funds to the Depositor, (ii) to the Underwriter, the Class X
Certificates and Class P Certificates, each with a Percentage Interest equal to
100% and (iii) to the Underwriter, the Class R Certificates with a Percentage
Interest equal to 99.99%. The Trustee shall retain a Class R Certificate
evidencing a 0.01% Percentage Interest.
ARTICLE V
THE CERTIFICATES
5.01 THE CERTIFICATES.
The Certificates shall be substantially in the forms attached
hereto as exhibits. The Certificates shall be issuable in registered form, in
the minimum denominations, integral multiples in excess thereof (except that one
Certificate in each Class may be issued in a different amount which must be in
excess of the applicable minimum denomination) and aggregate denominations per
Class set forth in SECTION 2.10 of this Agreement.
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The Depositor hereby directs the Trustee to register the Class
X Certificates, the Class P Certificates and the Class R Certificate evidencing
a 99.99% Percentage Interest in the name of the Underwriter.
Subject to Section 10.04 respecting the final distribution on
the Certificates, on each Distribution Date the Trustee shall make distributions
to each Certificateholder of record on the preceding Record Date either (x) by
wire transfer in immediately available funds to the account of such holder at a
bank or other entity having appropriate facilities therefor as directed by that
Certificateholder by written wire instructions provided to the Trustee or (y),
in the event that no wire instructions are provided to the Trustee, by check
mailed by first class mail to such Certificateholder at the address of such
holder appearing in the Register.
The Certificates shall be executed by manual or facsimile
signature on behalf of the Trustee by an authorized officer. Certificates
bearing the manual or facsimile signatures of individuals who were, at the time
such signatures were affixed, authorized to sign on behalf of the Trustee shall
bind the Trustee, notwithstanding that such individuals or any of them have
ceased to be so authorized prior to the countersignature and delivery of any
such Certificates or did not hold such offices at the date of such Certificate.
No Certificate shall be entitled to any benefit under this Agreement, or be
valid for any purpose, unless countersigned by the Trustee by manual signature,
and such countersignature upon any Certificate shall be conclusive evidence, and
the only evidence, that such Certificate has been duly executed and delivered
hereunder. All Certificates shall be dated the date of their countersignature.
On the Closing Date, the Trustee shall countersign the Certificates to be issued
at the direction of the Depositor, or any affiliate thereof.
The Depositor shall provide, or cause to be provided, to the
Trustee on a continuous basis, an adequate inventory of Certificates to
facilitate transfers.
5.02 REGISTER; REGISTRATION OF TRANSFER AND EXCHANGE OF
CERTIFICATES.
(a) The Trustee shall maintain, or cause to be maintained in
accordance with the provisions of Section 5.06, a Register for the
Trust Fund in which, subject to the provisions of subsections (b) and
(c) below and to such reasonable regulations as it may prescribe, the
Trustee shall provide for the registration of Certificates and of
transfers and exchanges of Certificates as herein provided. Upon
surrender for registration of transfer of any Certificate, the Trustee
shall execute and deliver, in the name of the designated transferee or
transferees, one or more new Certificates of the same Class and
aggregate Percentage Interest.
At the option of a Certificateholder, Certificates may be
exchanged for other Certificates of the same Class in authorized denominations
and evidencing the same aggregate Percentage Interest upon surrender of the
Certificates to be exchanged at the office or agency of the Trustee. Whenever
any Certificates are so surrendered for
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exchange, the Trustee shall execute, authenticate, and deliver the Certificates
which the Certificateholder making the exchange is entitled to receive. Every
Certificate presented or surrendered for registration of transfer or exchange
shall be accompanied by a written instrument of transfer in form satisfactory to
the Trustee duly executed by the holder thereof or his attorney duly authorized
in writing. In the event, the Depositor or an Affiliate transfers the Class X
Certificates, or a portion thereof, to another Affiliate, it shall notify the
Trustee in writing of the affiliated status of the transferee. The Trustee shall
have no liability regarding the lack of notice with respect thereto.
No service charge to the Certificateholders shall be made for
any registration of transfer or exchange of Certificates, but the Registrar or
the Trustee may require the payment of a sum sufficient to cover any tax or
governmental charge that may be imposed in connection with any transfer or
exchange of Certificates.
All Certificates surrendered for registration of transfer or
exchange shall be cancelled and subsequently destroyed by the Trustee in
accordance with the Trustee's customary procedures.
(b) No transfer of a Private Certificate shall be made unless
such transfer is made pursuant to an effective registration statement
under the Securities Act and any applicable state securities laws or is
exempt from the registration requirements under said Act and such state
securities laws. In the event that a transfer of a Private Certificate
which is a Private Certificate is to be made in reliance upon an
exemption from the Securities Act and such laws, in order to assure
compliance with the Securities Act and such laws, the Certificateholder
desiring to effect such transfer shall certify to the Trustee in
writing the facts surrounding the transfer in substantially the form
set forth in Exhibit H (the "TRANSFEROR CERTIFICATE") and either (i)
there shall be delivered to the Trustee a letter in substantially the
form of Exhibit I (the "RULE 144A LETTER") or (ii) in the case of the
Class X Certificates, there shall be delivered to the Trustee at the
expense of the transferor an Opinion of Counsel addressed to the
Trustee that such transfer may be made without registration under the
Securities Act. In the event that a transfer of a Private Certificate
which is a Book-Entry Certificate is to be made in reliance upon an
exemption from the Securities Act and such laws, in order to assure
compliance with the Securities Act and such laws, the Certificateholder
desiring to effect such transfer will be deemed to have made as of the
transfer date each of the certifications set forth in the Transferor
Certificate in respect of such Certificate and the transferee will be
deemed to have made as of the transfer date each of the certifications
set forth in the Rule 144A Letter in respect of such Certificate, in
each case as if such Certificate were evidenced by a Private
Certificate. The Depositor shall provide to any Holder of a Private
Certificate and any prospective transferee designated by any such
Holder, information regarding the related Certificates and the Mortgage
Loans and such other information as shall be necessary to satisfy the
condition to eligibility set forth in Rule 144A(d)(4) for transfer of
any such Certificate without registration thereof under the Securities
Act pursuant to the registration exemption provided
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by Rule 144A. The Trustee and the Servicers shall cooperate with the
Depositor in providing the Rule 144A information referenced in the
preceding sentence, including providing to the Depositor such
information regarding the Certificates, the Mortgage Loans and other
matters regarding the Trust Fund as the Depositor shall reasonably
request to meet its obligation under the preceding sentence. Each
Holder of a Private Certificate desiring to effect such transfer shall,
and does hereby agree to, indemnify the Trustee and the Depositor and
the Servicers against any liability that may result if the transfer is
not so exempt or is not made in accordance with such federal and state
laws.
No transfer of an ERISA-Restricted Certificate shall be made
unless the Trustee shall have received either (i) a representation from the
transferee of such Certificate acceptable to and in form and substance
satisfactory to the Trustee (in the event such Certificate is a Private
Certificate or a Residual Certificate, such requirement is satisfied only by the
Trustee's receipt of a representation letter from the transferee substantially
in the form of Exhibit I), to the effect that such transferee is not an employee
benefit plan or arrangement subject ERISA, a plan subject to Section 4975 of the
Code nor a person acting on behalf of any such plan or arrangement nor using the
assets of any such plan or arrangement to effect such transfer, (ii) in the case
of an ERISA-Restricted Certificate other than a Residual Certificate or a Class
X or Class P Certificate that has been the subject of an ERISA-Qualifying
Underwriting and the purchaser is an insurance company, a representation that
the purchaser is an insurance company that is purchasing such Certificates with
funds contained in an "insurance company general account" (as such term is
defined in Section V(e) of Prohibited Transaction Class Exemption 95-60 ("PTCE
95-60")) and that the conditions of Sections I and III of PTCE 95-60 have been
satisfied or (iii) in the case of any such ERISA-Restricted Certificate other
than a Class B Certificate, Class M-1 Certificate, Residual Certificate or Class
P Certificate presented for registration in the name of an employee benefit plan
subject to ERISA, a plan or arrangement subject to Section 4975 of the Code (or
comparable provisions of any subsequent enactments), or a trustee of any such
plan or any other person acting on behalf of any such plan or arrangement or
using such plan's or arrangement's assets, an Opinion of Counsel satisfactory to
the Trustee and the Servicer, which Opinion of Counsel shall not be an expense
of the Trustee, the Servicers or the Trust Fund, addressed to the Trustee, to
the effect that the purchase or holding of such certificate are permissable
under applicable law, will not result in a prohibited transaction under ERISA or
section 4975 of the Code, will not result in the assets of the Trust Fund being
deemed to be "plan assets" and subject to the prohibited transaction provisions
of ERISA and the Code and will not subject the Trustee or the Servicers to any
obligation in addition to those expressly undertaken in this Agreement or to any
liability. For purposes of the preceding sentence, with respect to an
ERISA-Restricted Certificate that is not a Class P Certificate, Class X
Certificate or Residual Certificate, in the event the representation letter
referred to in the preceding sentence is not furnished, such representation
shall be deemed to have been made to the Trustee by the transferee's (including
an initial acquirer's) acceptance of the ERISA-Restricted Certificates. In the
event that such representation is violated, or any attempt to transfer to a plan
or arrangement subject to ERISA, a plan subject to
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Section 4975 of the Code, or a person acting on behalf of any such plan or
arrangement or using the assets of any such plan or arrangement, without such
Opinion of Counsel, such attempted transfer or acquisition shall be void and of
no effect and the purported beneficial owner shall indemnify and hold harmless
the Depositor, the Trustee, the Servicers and the Trust from and against any and
all liabilities, claims, costs or expenses incurred by the parties as a result
of that acquisition or holding.
Neither the Class R Certificates nor the Class P Certificate
may be sold to any employee benefit plan subject to Title I of ERISA, any plan
subject to Section 4975 of the Code, or any plan subject to any Similar Law or
any person investing on behalf of or with plan assets of such plan.
To the extent permitted under applicable law (including, but
not limited to, ERISA), the Trustee shall be under no liability to any Person
for any registration of transfer of any ERISA-Restricted Certificate that is in
fact not permitted by this Section 5.02(b) or for making any payments due on
such Certificate to the Holder thereof or taking any other action with respect
to such Holder under the provisions of this Agreement so long as the transfer
was registered by the Trustee in accordance with the foregoing requirements.
(c) Each Person who has or who acquires any Ownership Interest
in a Residual Certificate shall be deemed by the acceptance or
acquisition of such Ownership Interest to have agreed to be bound by
the following provisions, and the rights of each Person acquiring any
Ownership Interest in a Residual Certificate are expressly subject to
the following provisions:
(i) Each Person holding or acquiring any Ownership Interest in
a Residual Certificate shall be a Permitted Transferee and shall
promptly notify the Trustee of any change or impending change in its
status as a Permitted Transferee;
(ii) No Ownership Interest in a Residual Certificate may be
registered on the Closing Date or thereafter transferred, and the
Trustee shall not register the Transfer of any Residual Certificate
unless, in addition to the certificates required to be delivered to the
Trustee under subparagraph (b) above, the Trustee shall have been
furnished with an affidavit (a "TRANSFER AFFIDAVIT") of the initial
owner or the proposed transferee in the form attached hereto as Exhibit
G;
(iii) Each Person holding or acquirinG anY Ownership Interest
in a Residual Certificate shall agree (A) to obtain a Transfer
Affidavit from any other Person to whom such Person attempts to
Transfer its Ownership Interest in a Residual Certificate, (B) to
obtain a Transfer Affidavit from any Person for whom such Person is
acting as nominee, trustee or agent in connection with any Transfer of
a Residual Certificate and (C) not to Transfer its Ownership Interest
in a Residual Certificate or to cause the Transfer of an Ownership
Interest in a Residual Certificate to any other Person if it has actual
knowledge that such Person is not a Permitted Transferee;
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(iv) Any attempted or purported Transfer of any Ownership
Interest in a Residual Certificate in violation of the provisions of
this Section 5.02(c) shall be absolutely null and void and shall vest
no rights in the purported Transferee. If any purported transferee
shall become a Holder of a Residual Certificate in violation of the
provisions of this Section 5.02(c), then the last preceding Permitted
Transferee shall be restored to all rights as Holder thereof
retroactive to the date of registration of Transfer of such Residual
Certificate. The Trustee shall be under no liability to any Person for
any registration of Transfer of a Residual Certificate that is in fact
not permitted by Section 5.02(b) and this Section 5.02(c) or for making
any payments due on such Certificate to the Holder thereof or taking
any other action with respect to such Holder under the provisions of
this Agreement so long as the Transfer was registered after receipt of
the related Transfer Affidavit, Transferor Certificate and the Rule
144A Letter. The Trustee shall be entitled but not obligated to recover
from any Holder of a Residual Certificate that was in fact not a
Permitted Transferee at the time it became a Holder or, at such
subsequent time as it became other than a Permitted Transferee, all
payments made on such Residual Certificate at and after either such
time. Any such payments so recovered by the Trustee shall be paid and
delivered by the Trustee to the last preceding Permitted Transferee of
such Certificate; and
(v) The Depositor shall use its best efforts to make
available, upon receipt of written request from the Trustee, all
information necessary to compute any tax imposed under Section 860E(e)
of the Code as a result of a Transfer of an Ownership Interest in a
Residual Certificate to any Holder who is not a Permitted Transferee.
The restrictions on Transfers of a Residual Certificate set
forth in this Section 5.02(c) shall cease to apply (and the applicable portions
of the legend on a Residual Certificate may be deleted) with respect to
Transfers occurring after delivery to the Trustee of an Opinion of Counsel
addressed to the Trustee, which Opinion of Counsel shall not be an expense of
the Trust Fund, the Trustee or the Servicer, to the effect that the elimination
of such restrictions will not cause either REMIC I or REMIC II to fail to
qualify as a REMIC at any time that the Certificates are outstanding or result
in the imposition of any tax on the Trust Fund, a Certificateholder or another
Person. Each Person holding or acquiring any Ownership Interest in a Residual
Certificate hereby consents to any amendment of this Agreement which, based on
an Opinion of Counsel addressed to the Trustee and furnished to the Trustee, is
reasonably necessary (a) to ensure that the record ownership of, or any
beneficial interest in, a Residual Certificate is not transferred, directly or
indirectly, to a Person that is not a Permitted Transferee and (b) to provide
for a means to compel the Transfer of a Residual Certificate which is held by a
Person that is not a Permitted Transferee to a Holder that is a Permitted
Transferee.
(d) The preparation and delivery of all certificates and
opinions referred to above in this Section 5.02 in connection with
transfer shall be at the expense of the parties to such transfers.
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(e) Except as provided below, the Book-Entry Certificates
shall at all times remain registered in the name of the Depository or
its nominee and at all times: (i) registration of the Certificates may
not be transferred by the Trustee except to another Depository; (ii)
the Depository shall maintain book-entry records with respect to the
Certificate Owners and with respect to ownership and transfers of such
Book-Entry Certificates; (iii) ownership and transfers of registration
of the Book-Entry Certificates on the books of the Depository shall be
governed by applicable rules established by the Depository; (iv) the
Depository may collect its usual and customary fees, charges and
expenses from its Depository Participants; (v) the Trustee shall deal
with the Depository, Depository Participants and indirect participating
firms as representatives of the Owners of the Book-Entry Certificates
for purposes of exercising the rights of holders under this Agreement,
and requests and directions for and votes of such representatives shall
not be deemed to be inconsistent if they are made with respect to
different Owners; and (vi) the Trustee may rely and shall be fully
protected in relying upon information furnished by the Depository with
respect to its Depository Participants and furnished by the Depository
Participants with respect to indirect participating firms and persons
shown on the books of such indirect participating firms as direct or
indirect Owners.
All transfers by Owners of Book-Entry Certificates shall be
made in accordance with the procedures established by the Depository Participant
or brokerage firm representing such Owner. Each Depository Participant shall
only transfer Book-Entry Certificates of Owners it represents or of brokerage
firms for which it acts as agent in accordance with the Depository's normal
procedures.
If (x) (i) the Depository or the Depositor advises the Trustee
in writing that the Depository is no longer willing or able to properly
discharge its responsibilities as Depository, and (ii) the Depositor is unable
to locate a qualified successor, or (y) the Depositor at its option advises the
Trustee in writing that it elects to terminate the book-entry system through the
Depository, the Trustee shall notify all Owners, through the Depository, of the
occurrence of any such event and of the availability of definitive,
fully-registered Certificates (the "DEFINITIVE CERTIFICATES") to Owners
requesting the same. Upon surrender to the Trustee of the related Class of
Certificates by the Depository, accompanied by the instructions from the
Depository for registration, the Trustee shall issue the Definitive
Certificates. Neither the Servicers, the Depositor nor the Trustee shall be
liable for any delay in delivery of such instruction and each may conclusively
rely on, and shall be protected in relying on, such instructions. The Depositor
shall provide the Trustee with an adequate inventory of Certificates to
facilitate the issuance and transfer of Definitive Certificates. Upon the
issuance of Definitive Certificates all references herein to obligations imposed
upon or to be performed by the Depository shall be deemed to be imposed upon and
performed by the Trustee, to the extent applicable with respect to such
Definitive Certificates and the Trustee shall recognize the Holders of the
Definitive Certificates as Certificateholders hereunder; PROVIDED, that the
Trustee shall not by virtue of its assumption of such obligations become liable
to any party for any act or failure to act of the Depository.
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5.03 MUTILIATED, DESTROYED, LOST OR STOLEN CERTIFICATES.
If (a) any mutilated Certificate is surrendered to the
Trustee, or the Trustee receives evidence to its satisfaction of the
destruction, loss or theft of any Certificate and (b) there is delivered to the
Depositor, the Servicers, the Certificate Insurer and the Trustee such security
or indemnity as may be required by them to hold each of them harmless, then, in
the absence of notice to the Trustee that such Certificate has been acquired by
a bona fide purchaser, the Trustee shall execute, authenticate and deliver, in
exchange for or in lieu of any such mutilated, destroyed, lost or stolen
Certificate, a new Certificate of like Class, tenor and Percentage Interest. In
connection with the issuance of any new Certificate under this Section 5.03, the
Trustee 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) connected therewith.
Any replacement Certificate issued pursuant to this Section 5.03 shall
constitute complete and indefeasible evidence of ownership, as if originally
issued, whether or not the lost, stolen or destroyed Certificate shall be found
at any time.
5.04 PERSONS DEEMED OWNERS.
The Servicers, the Certificate Insurer, the Trustee, the
Depositor and any agent of the Servicers, the Certificate Insurer, the Depositor
or the Trustee may treat the Person in whose name any Certificate is registered
as the owner of such Certificate for the purpose of receiving distributions as
provided in this Agreement and for all other purposes whatsoever, and neither
the Servicers, the Certificate Insurer, the Trustee, the Depositor nor any agent
of the Servicers, the Certificate Insurer, the Depositor or the Trustee shall be
affected by any notice to the contrary.
5.05 ACCESS TO LIST OF CERTIFICATEHOLDERS' NAMES AND
ADDRESSES.
If three or more Certificateholders (a) request such
information in writing from the Trustee, (b) state that such Certificateholders
desire to communicate with other Certificateholders with respect to their rights
under this Agreement or under the Certificates, and (c) provide a copy of the
communication which such Certificateholders propose to transmit, or if the
Depositor or any Servicer shall request such information in writing from the
Trustee, then the Trustee shall, within ten Business Days after the receipt of
such request, provide the Depositor, the Servicer or such Certificateholders at
such recipients' expense the most recent list of the Certificateholders of such
Trust Fund held by the Trustee, if any. The Depositor and every
Certificateholder, by receiving and holding a Certificate, agree that the
Trustee shall not be held accountable by reason of the disclosure of any such
information as to the list of the Certificateholders hereunder, regardless of
the source from which such information was derived.
5.06 MAINTENANCE OF OFFICE OR AGENCY.
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The Trustee will maintain or cause to be maintained at its
expense an office or offices or agency or agencies in Dallas, Texas where
Certificates may be surrendered for registration of transfer or exchange. The
Trustee initially designates its office located at ▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇▇,
▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇▇ for such purposes. The Trustee will give prompt written
notice to the Certificateholders of any change in such location of any such
office or agency.
5.07 RIGHTS OF THE CERTIFICATE INSURER TO EXERCISE RIGHTS OF
CLASS A CERTIFICATEHOLDERS.
(a) By accepting its Class A Certificate, each Class A
Certificateholder agrees that, unless a Certificate Insurer Default exists, the
Certificate Insurer shall be deemed to be the Class A Certificateholders for all
purposes (other than with respect to the receipt of payment on the Class A
Certificates) and shall have the right to exercise all rights of the Class A
Certificateholders under this Agreement and under the Class A Certificates
without any further consent of the Class A Certificateholders.
(b) All notices, statement reports, certificates or opinions
required by this Agreement to be sent to any Class A Certificateholder shall
also be sent to the Certificate Insurer.
5.08 CERTIFICATE INSURER DEFAULT.
Notwithstanding anything elsewhere in this Agreement or in the
Certificates to the contrary, if a Certificate Insurer Default exists, or if and
to the extent the Certificate Insurer has delivered its written renunciation of
all of its rights under this Agreement, all provisions of this Agreement which
(a) permit the Certificate Insurer to exercise rights of the Class A
Certificateholders, (b) restrict the ability of the Certificateholders, the
Servicers or the Trustee to act without the consent or approval of the
Certificate Insurer, (c) provide that a particular act or thing must be
acceptable to the Certificate Insurer, (d) permit the Certificate Insurer to
direct (or otherwise to require) the actions of the Trustee, the Servicers or
the Certificateholders, (e) provide that any action or omission taken with the
consent, approval or authorization of the Certificate Insurer shall be
authorized hereunder or shall not subject the party taking or omitting to take
such action to any liability hereunder or (f) have a similar effect, shall be of
no further force and effect and the Trustee shall administer the Trust Fund and
perform its obligations hereunder solely for the benefit of the Holders of the
Class A Certificates. Nothing in the foregoing sentence, nor any action taken
pursuant thereto or in compliance therewith, shall be deemed to have released
the Certificate Insurer from any obligation or liability it may have to any
party or to the Class A Certificateholders hereunder, under any other agreement,
instrument or document (including, without limitation, the Certificate Insurance
Policy) or under applicable law. At such time as the Class A Certificates are no
longer outstanding hereunder, and no amounts owed to the Certificate Insurer
hereunder or under the Certificate Insurance Agreement remain unpaid, the
Certificate Insurer's rights hereunder shall terminate.
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ARTICLE VI
COVENANTS
6.01 DISTRIBUTIONS.
On each Distribution Date, the Trustee shall withdraw amounts
from the Certificate Account and make the distributions with respect to the
Certificates in accordance with the terms of the Certificates and this
Agreement. Such distributions shall be made (i) by check or draft mailed or wire
transfer on each Distribution Date or (ii) if requested by any Owner of (A) a
Certificate having an initial Certificate Balance of not less than $1,000,000 or
(B) a Class X, Class P or Residual Certificate having a Percentage Interest of
Certificate of not less than 10% in writing not later than one Business Day
prior to the applicable Record Date (which request does not have to be repeated
unless it has been withdrawn), to such Owner by wire transfer to an account
within the United States designated no later than five Business Days prior to
the related Record Date, made on each Distribution Date, in each case to each
Owner of record on the immediately preceding Record Date.
6.02 MONEY FOR DISTRIBUTIONS TO BE HELD IN TRUST; WITHHOLDING.
(a) All payments of amounts due and payable with respect to
any Certificate that are to be made from amounts withdrawn from the
Certificate Account shall be made by and on behalf of the Trustee, and
no amounts shall be withdrawn from the Certificate Account for payments
of Certificates except as provided in this SECTION or SECTION 7.03, as
applicable.
(b) Whenever the Depositor has appointed one or more Paying
Agents pursuant to SECTION 12.15, the Trustee will, on the Business Day
immediately preceding each Distribution Date, deposit with such Paying
Agents in immediately available funds an aggregate sum sufficient to
pay the amounts then becoming due (to the extent funds are then
available for such purpose in the Certificate Account for the Class to
which such amounts are due), such sum to be held in trust for the
benefit of the Owners entitled thereto.
(c) The Depositor may at any time direct any Paying Agent to
pay to the Trustee all sums held in trust by such Paying Agent, such
sums to be held by the Trustee upon the same trusts as those upon which
the sums were held by such Paying Agent; and upon such payment by any
Paying Agent to the Trustee, such Paying Agent shall be released from
all further liability with respect to such money.
(d) The Depositor shall require each Paying Agent, including
the Trustee on behalf of the Trust, to comply with all requirements of
the Code and applicable state and local law with respect to the
withholding from any distributions made by
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it to any Owner of any applicable withholding taxes imposed thereon and
with respect to any applicable reporting requirements in connection
therewith.
(e) Any money held by the Trustee or any Paying Agent in trust
for the payment of any amount due with respect to any Certificate and
remaining unclaimed by the Owner of such Certificate for the period
then specified in the escheat laws of the State of New York after such
amount has become due and payable shall be discharged from such trust
and be paid to the Owners of the Class R Certificates; and the Owner of
such Certificate shall thereafter, as an unsecured general creditor,
look only to the Owners of the Class R Certificates for payment thereof
(but only to the extent of the amounts so paid to the Owners of the
Class R Certificates) and all liability of the Trustee or such Paying
Agent with respect to such trust money shall thereupon cease; PROVIDED,
HOWEVER, that the Trustee or such Paying Agent before being required to
make any such payment, may, at the expense of the Trust, cause to be
published once, in the eastern edition of THE WALL STREET JOURNAL,
notice that such money remains unclaimed and that, after a date
specified therein, which shall be not fewer than thirty (30) days from
the date of such publication, any unclaimed balance of such money then
remaining will be paid to the Owners of the Class R Certificates. The
Trustee shall, at the direction of the Depositor, also adopt and
employ, at the expense of the Trust, any other reasonable means of
notification of such payment (including but not limited to mailing
notice of such payment to Owners whose right to or interest in moneys
due and payable but not claimed is determinable from the records of the
Registrar, the Trustee or any Paying Agent, at the last address of
record for each such Owner).
6.03 PROTECTION OF TRUST ESTATE.
The Trustee will hold the Trust Estate in trust for the
benefit of the Owners and the Certificate Insurer and, at the request of the
Depositor, will from time to time execute and deliver all such supplements and
amendments hereto pursuant to SECTION 12.14 and all instruments of further
assurance and other instruments, and will take such other action upon such
request from and at the expense of the Depositor, the Certificate Insurer or the
applicable Servicer, to:
(i) more effectively hold in trust all or any portion of the
Trust Estate;
(ii) perfect, publish notice of, or protect the validity of
any grant made or to be made by this Agreement;
(iii) enforce any of the Mortgage Loans, the Sale Agreements
or the Certificate Insurance Policy; or
(iv) preserve and defend title to the Trust Estate and the
rights of the Trustee, and the ownership interests of the Owners
represented thereby, in such Trust Estate against the claims of all
Persons and parties.
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Notwithstanding the foregoing, the Trustee shall be
responsible for all expenses incurred in connection with the custody and
delivery of the Mortgage Loan Documents.
The Trustee shall send copies of any request to take any
action pursuant to this SECTION 6.03 to the other parties hereto.
(b) The Trustee shall have the power to enforce, and shall
enforce the obligations and rights of the other parties to this
Agreement, the obligations of the Sellers under the Sale Agreements,
the Depositor under SECTION 3.03(A) of this Agreement and ▇▇▇▇▇▇▇ ▇▇▇▇▇
Mortgage Company under the Sale and Warranties Agreement; in addition,
the Owners, by action, suit or proceeding at law or equity, shall also
have the power to enjoin, by action or suit in equity, any acts or
occurrences which may be unlawful or in violation of the rights of the
Owners as such rights are set forth in this Agreement; PROVIDED,
HOWEVER, that nothing in this SECTION 6.03 shall require any action by
the Trustee unless the Trustee shall first (i) have been furnished
indemnity satisfactory to it and (ii) when required by this Agreement,
have been requested by the Owners of a majority of the Percentage
Interests represented by the Certificates then Outstanding or, if there
are no longer any Offered Certificates then outstanding, by such
majority of the Percentage Interests represented by the Class R
Certificates.
(c) The Trustee shall execute any instrument required pursuant
to this SECTION 6.03 so long as such instrument does not conflict with
this Agreement or with the Trustee's fiduciary duties, or adversely
affect its rights and immunities hereunder.
6.04 PERFORMANCE OF OBLIGATIONS.
The Trustee will not take any action that would release any
Person from any of such Person's covenants or obligations under any instrument
or document relating to the Certificates or which would result in the amendment,
hypothecation, subordination, termination or discharge of, or impair the
validity or effectiveness of, any such instrument or document, except as
expressly provided in this Agreement or such other instrument or document.
The Trustee may contract with other Persons to assist it in
performing its duties hereunder pursuant to SECTION 11.02(G).
6.05 NEGATIVE COVENANTS.
The Trustee, to the extent of its duties hereunder, will not
consent to the Trust or cause the Trust to:
(i) sell, transfer, exchange or otherwise dispose of any of
the Trust Estate except as expressly permitted by this Agreement;
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(ii) claim any credit on or make any deduction from the
distributions payable in respect of, the Certificates (other than
amounts properly withheld from such payments under the Code) or assert
any claim against any present or former Owner by reason of the payment
of any taxes levied or assessed upon any of the Trust Estate;
(iii) incur, assume or guaranty any indebtedness of any
Person;
(iv) dissolve or liquidate in whole or in part, except
pursuant to Article X hereof;
(v) (A) cause or consent to an action which causes the
validity or effectiveness of this Agreement to be impaired, or permit
any Person to be released from any covenants or obligations with
respect to the Trust or to the Certificates under this Agreement,
except as may be expressly permitted hereby or (B) permit any lien,
charge, adverse claim, security interest, mortgage or other encumbrance
to be created on or extend to or otherwise arise upon or burden the
Trust Estate or any part thereof or any interest therein or the
proceeds thereof;
(vi) permit either Trust REMIC to accept a prohibited
contribution or engage in a prohibited transaction pursuant to the
REMIC Provisions; or
(vii) take any action that could cause either Trust REMIC to
fail to qualify as such, or omit to take any action within the scope of
its duties necessary to preserve the status of either Trust REMIC.
6.06 NO OTHER POWERS.
The Trustee will not permit the Trust to engage in any
business activity or transaction other than those activities permitted by
SECTION 2.03.
6.07 LIMITATION OF SUITS. No Owner shall have any right to
institute any proceeding, judicial or otherwise, with respect to this Agreement,
the Certificate Insurance Policy, the Sale Agreements or for the appointment of
a receiver or trustee of the Trust, or for any other remedy with respect to an
Event of Default hereunder, unless:
(i) such Owner has previously given written notice to the
Depositor, and the Trustee of such Owner's intention to institute such
proceeding;
(ii) the Owners of not less than 25% of the Percentage
Interests represented by the Class A, Class M-1, Class B, Class P or
Class X Certificates then Outstanding or, if there are no Class A,
Class M-1, Class B, Class P or Class X Certificates then Outstanding,
by such percentage of the Percentage Interests represented by the Class
R Certificates, shall have made written request to the Trustee to
institute such proceeding in its own name as Trustee establishing the
Trust;
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(iii) such Owner or Owners have offered to the Trustee
reasonable indemnity against the costs, expenses and liabilities to be
incurred in compliance with such request;
(iv) the Trustee for sixty (60) days after its receipt of such
notice, request and offer of indemnity has failed to institute such
proceeding; and
(v) no direction inconsistent with such written request has
been given to the Trustee during such sixty (60) day period by the
Owners of a majority of the Percentage Interests represented by the
Class A, Class M-1, Class B, Class P or Class X Certificates or, if
there are no Class A, Class M-1, Class B, Class P or Class X
Certificates then Outstanding, by such majority of the Percentage
Interests represented by the Class R Certificates;
it being understood and intended that no one or more Owners shall have any right
in any manner whatever by virtue of, or by availing themselves of, any provision
of this Agreement to affect, disturb or prejudice the rights of any other Owner
of the same Class or to obtain or to seek to obtain priority or preference over
any other Owner of the same Class or to enforce any right under this Agreement,
except in the manner herein provided and for the equal and ratable benefit of
all the Owners of the same Class.
In the event the Trustee shall receive conflicting or
inconsistent requests and indemnity from two or more groups of Owners, each
representing less than a majority of the applicable Class of Certificates and
each conforming to paragraphs (i) through (v) of this SECTION 6.07, the Trustee
will act at the direction of Owners holding the greater amount of Certificates.
If the Trustee receives conflicting or inconsistent requests and indemnity from
two or more groups of Owners representing an equal amount of Outstanding
Certificates, the Trustee in its sole discretion may determine what action, if
any, shall be taken, notwithstanding any other provisions of this Agreement and
the Trustee shall not be liable for any action taken pursuant to this SECTION
6.07.
6.08 UNCONDITIONAL RIGHTS OF OWNERS TO RECEIVE DISTRIBUTIONS.
Notwithstanding any other provision in this Agreement, the
Owner of any Certificate shall have the right, which is absolute and
unconditional, to receive distributions to the extent provided herein and
therein with respect to such Certificate or to institute suit for the
enforcement of any such distribution, and such right shall not be impaired
without the consent of such Owner.
6.09 RIGHTS AND REMEDIES CUMULATIVE.
Except as otherwise provided herein, no right or remedy herein
conferred upon or reserved to the Trustee or the Owners is intended to be
exclusive of any other right or remedy, and every right and remedy shall, to the
extent permitted by law, be cumulative and in addition to every other right and
remedy given hereunder or now or hereafter existing at law or in equity or
otherwise. Except as otherwise provided herein,
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the assertion or employment of any right or remedy hereunder, or otherwise,
shall not prevent the concurrent assertion or employment of any other
appropriate right or remedy.
6.10 DELAY OR OMISSION NOT WAIVER.
No delay of the Trustee, any Owner of any Certificate or the
Certificate Insurer to exercise any right or remedy under this Agreement with
respect to any event described in SECTION 8.17 shall impair any such right or
remedy or constitute a waiver of any such event or an acquiescence therein.
Every right and remedy given by this ARTICLE VI or by law to the Trustee, the
Owners or the Certificate Insurer, may be exercised from time to time, and as
often as may be deemed expedient, by the Trustee, the Owners or the Certificate
Insurer, as the case may be.
6.11 CONTROL BY DEPOSITOR OR OWNERS.
The Owners of a majority of the Percentage Interests
represented by the Offered Certificates then Outstanding, or, if there are no
longer any Offered Certificates then Outstanding, by a majority of the
Percentage Interests represented by the Class R Certificates then Outstanding
may direct the time, method and place of conducting any proceeding for any
remedy available to the Trustee with respect to the Certificates or exercising
any trust or power conferred on the Trustee with respect to the Certificates or
the Trust Estate, including, but not limited to, those powers set forth in
SECTION 6.03 hereof, PROVIDED that:
(i) such direction shall not be in conflict with any rule of
law or with this Agreement;
(ii) the Trustee shall have been provided with indemnity
satisfactory to it; and
(iii) the Trustee may take any other action deemed proper by
the Trustee, as the case may be, which is not inconsistent with such
direction; PROVIDED, HOWEVER, that neither the Trustee nor the
Depositor, as the case may be, need take any action which it determines
might involve it in liability or may be unjustly prejudicial to the
Owners not so directing.
6.12 INDEMNIFICATION.
The Depositor agrees to indemnify and hold the Servicers, the
Trustee, the Certificate Insurer and each Owner harmless against any and all
claims, losses, penalties, fines, forfeitures, legal fees and related costs,
judgments, and any other costs, fees and expenses that any Servicer, the
Trustee, the Certificate Insurer and any Owner may sustain in any way related to
the failure of the Depositor to perform its duties in compliance with the terms
of this Agreement. The Depositor shall immediately notify the Servicers, the
Trustee, the Certificate Insurer and each Owner if such a claim is made by a
third party with respect to this Agreement, and the Depositor shall assume (with
the consent of the Trustee, the related Servicer or the Certificate Insurer, as
applicable) the
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defense of any such claim and pay all expenses in connection therewith,
including reasonable counsel fees, and promptly pay, discharge and satisfy any
judgment or decree which may be entered against a Servicer, the Trustee and/or
any Owner in respect of such claim. The provisions of this SECTION 6.12 shall
survive the termination of this Agreement, the termination or resignation of a
Servicer, the Trustee or the Certificate Insurer and the payment of the
outstanding Certificates.
ARTICLE VII
PAYMENTS TO THE CERTIFICATEHOLDERS
7.01 ESTABLISHMENT OF CERTIFICATE ACCOUNT; DEPOSITS IN
CERTIFICATE ACCOUNT; PERMITTED WITHDRAWALS FROM CERTIFICATE ACCOUNT.
(a) No later than the Closing Date, the Trustee will establish
and maintain a trust account, in its name and for the benefit of
Certificateholders and the Certificate Insurer, which shall not be
interest bearing, titled "JPMorgan Chase Bank, as Trustee, in trust for
the holders of GSRPM Mortgage Loan Trust 2003-1 Certificate Account,"
(the "CERTIFICATE ACCOUNT").
(b) The Trustee shall promptly upon receipt, deposit into the
Certificate Account and retain therein (i) the amounts received from
Fairbanks and Wilshire pursuant to SECTION 8.04(C) and (ii) on each
Remittance Date, the amounts received from Wilshire with respect to the
Contracts pursuant to Article IX hereof.
(c) Amounts on deposit in the Certificate Account shall be
withdrawn on each Distribution Date by the Trustee, or the Paying Agent
on its behalf, to effect the applicable distributions described in
SECTION 7.06(B).
7.02 RESERVED.
7.03 THE CERTIFICATE INSURANCE POLICY.
(a) If, based on the information provided by the applicable
Servicer pursuant to SECTION 8.04(D)(II), the Trustee determines that a
Deficiency Amount to be covered by the Certificate Insurance Policy will exist
for the related Distribution Date or that a Preference Amount to be covered by
the Certificate Insurance Policy exists, the Trustee shall complete the notice
in the form of Exhibit A to the Certificate Insurance Policy (the "CERTIFICATE
INSURER NOTICE") and submit such Certificate Insurer Notice in accordance with
the Certificate Insurance Policy to the Certificate Insurer no later than 12:00
P.M., New York City time, on the second Business Day immediately preceding such
Distribution Date, as a claim for the amount of such Deficiency Amount or
Preference Amount.
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(b) No later than the Closing Date, the Trustee will establish
and maintain a trust account, in its name and for the benefit of Holders of the
Class A Certificates, titled "JPMorgan Chase Bank, as Trustee, in trust for the
holders of GSRPM Mortgage Loan Trust 2003-1 Certificate Insurance Account," (the
"CERTIFICATE INSURANCE ACCOUNT"). Upon receipt of an Insured Payment from the
Certificate Insurer on behalf of the Holders of any of the Class A Certificates,
the Trustee shall deposit such Insured Payment in the Certificate Insurance
Account. All amounts on deposit in the Certificate Insurance Account shall
remain uninvested. The Trustee shall distribute on each Distribution Date any
Insured Payment relating to interest and any Insured Payment relating to
principal or losses for such Distribution Date from the Certificate Insurance
Account as provided in SECTION 7.06(C).
(c) The Trustee shall (i) receive as attorney-in-fact of each
Holder of a Class A Certificate any related Insured Payment from the Certificate
Insurer and (ii) distribute such Insured Payment to such Certificateholders as
set forth in subsection (b) above. Insured Payments disbursed by the Trustee
from proceeds of the Certificate Insurance Policy shall not be considered
payment by the Trust with respect to the Class A Certificates, nor shall such
disbursement of such Insured Payments discharge the obligations of the Trust
with respect to the amounts thereof, and the Certificate Insurer shall become
the owner of such amounts to the extent covered by such Insured Payments as the
deemed assignee of such Holders of Class A Certificates. The Trustee hereby
agrees (and each Holder of a Class A Certificate by its acceptance of its Class
A Certificates hereby agrees) for the benefit of the Certificate Insurer that
the Trustee shall recognize that to the extent the Certificate Insurer pays
Insured Payments, either directly or indirectly (as by paying amounts to Trustee
for distribution to such Holders), to such Holders, the Certificate Insurer will
be entitled to be subrogated to the rights of the such Holders to the extent of
such Insured Payments.
7.04 INVESTMENT OF ACCOUNTS.
(a) Amounts on deposit in the Certificate Insurance Account
shall be held uninvested. Amounts on deposit in the Certificate Account may be
invested by the Trustee in Eligible Investments, for the benefit of the
Depositor and upon the direction of the Depositor, on each Remittance Date. If
no investment direction of the Depositor with respect to the Certificate Account
is received by the Trustee, the Trustee shall invest the funds in such account
in Eligible Investments managed by the Trustee or an Affiliate of the kind
described in clause (f) of the definition of Eligible Investments. Such Eligible
Investments shall mature or be redeemable three Business Days prior to the
Distribution Date and any net investment income therefrom shall be distributed
to the Depositor in accordance with its written instructions. In the event of a
loss in the Certificate Account because of an Eligible Investment, the Depositor
shall be required to deposit the amount of such loss into the Certificate
Account within one Business Day of realization of such loss.
(b) Amounts on deposit in the Collection Account established
by Fairbanks and Wilshire, as applicable, may be invested by the applicable
Servicer in
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Eligible Investments subject to Section 7.04(b), and all such investments shall
mature on or before the next Remittance Date. All income or other gain from
investments in any Collection Account established pursuant to this Agreement
shall be for the account of Fairbanks or Wilshire, as applicable. Any loss
resulting from any investments shall be for the account of the Person that
directed the Investment and promptly upon the realization of such loss such
Person shall contribute funds in an amount equal to such loss to such Account.
7.05 ELIGIBLE INVESTMENT.
The following are "ELIGIBLE INVESTMENTS":
(a) direct obligations of, or obligations fully guaranteed as
to timely payment of principal and interest by, the United States or
any agency or instrumentality thereof, provided such obligations are
backed by the full faith and credit of the United States;
(b) demand and time deposits in, certificates of deposit of,
or bankers' acceptances (which shall each have an original maturity of
not more than 90 days and, in the case of bankers' acceptances, shall
in no event have an original maturity of more than 365 days or a
remaining maturity of more than 30 days) denominated in United States
dollars and issued by any Depository Institution and rated F1+ by
Fitch, P-1 by Moody's and A-1+ by S&P;
(c) repurchase obligations with respect to any security
described in clause (a) above entered into with a Depository
Institution (acting as principal);
(d) securities bearing interest or sold at a discount that are
issued by any corporation incorporated under the laws of the United
States of America or any state thereof and that are rated by each
Rating Agency that rates such securities in its highest long-term
unsecured rating categories at the time of such investment or
contractual commitment providing for such investment;
(e) commercial paper (including both non-interest-bearing
discount obligations and interest-bearing obligations payable on demand
or on a specified date not more than 30 days after the date of
acquisition thereof) that is rated by each Rating Agency that rates
such securities in its highest short-term unsecured debt rating
available at the time of such investment;
(f) units of money market funds, including money market funds
advised by the Depositor or the Trustee or an Affiliate thereof, that
have been rated "Aaa" by Moody's, "AAAm" or "AAAm-G" by Standard &
Poor's and, if rated by Fitch, at least "AA" by Fitch; and
(g) if previously confirmed in writing to the Trustee, any
other demand, money market or time deposit, or any other obligation,
security or investment, as
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may be acceptable to the Rating Agencies (without regard to the
Certificate Insurance Policy) as a permitted investment of funds
backing "Aaa" or "AAA" rated securities;
PROVIDED, HOWEVER, that no instrument described hereunder shall
evidence either the right to receive (a) only interest with respect to
the obligations underlying such instrument or (b) both principal and
interest payments derived from obligations underlying such instrument
and the interest and principal payments with respect to such instrument
provide a yield to maturity at par greater than 120% of the yield to
maturity at par of the underlying obligations.
7.06 PRIORITY AND SUBORDINATION OF DISTRIBUTIONS.
(a) (1)(A) On each Distribution Date, the following amounts,
in the following order of priority, shall be distributed by REMIC I to
REMIC II on account of the REMIC I Regular Interests or withdrawn from
the Distribution Account and distributed to the holders of the Class R
Certificates (in respect of the Class R-I Interest), as the case may
be:
(i) to Holders of REMIC I Regular Interest LT-AA, REMIC I
Regular ▇▇▇▇▇▇▇▇ ▇▇-▇▇, REMIC I Regular ▇▇▇▇▇▇▇▇ ▇▇-▇▇, REMIC I Regular
▇▇▇▇▇▇▇▇ ▇▇-▇▇, REMIC I Regular Interest LT-M1, REMIC I Regular
Interest LT-B1, REMIC I Regular Interest LT-B2, REMIC I Regular
Interest LT-B3, REMIC I Regular Interest LT-ZZ and REMIC I Regular
Interest LT-P, pro rata, in an amount equal to (A) the Uncertificated
Accrued Interest for such Distribution Date, plus (B) any amounts in
respect thereof remaining unpaid from previous Distribution Dates.
Amounts payable as Uncertificated Accrued Interest in respect of REMIC
I Regular Interest LT-ZZ shall be reduced and deferred when the REMIC I
Overcollateralized Amount is less than the REMIC I
Overcollateralization Target Amount, by the lesser of (x) the amount of
such difference and (y) the REMIC I Regular Interest LT-ZZ Maximum
Interest Deferral Amount and such amount will be payable to the Holders
of REMIC I Regular ▇▇▇▇▇▇▇▇ ▇▇-▇▇, REMIC I Regular ▇▇▇▇▇▇▇▇ ▇▇-▇▇,
REMIC I Regular ▇▇▇▇▇▇▇▇ ▇▇-▇▇, REMIC I Regular Interest LT-M1, REMIC I
Regular Interest LT-B1, REMIC I Regular Interest LT-B2 and REMIC I
Regular Interest LT-B3 in the same proportion as the Excess
Subordinated Amount is allocated to the Corresponding Certificates;
(ii) second, to the Holders of REMIC I Regular Interests, in
an amount equal to the remainder of the Available Funds for such
Distribution Date after the distributions made pursuant to clause (i)
above, allocated as follows:
(a) to the Holders of REMIC I Regular Interest LT-AA
and REMIC I Regular Interest LT-P, 98.00% of such remainder
(other than amounts payable under clause (d) below), until the
Uncertificated Principal Balance of such REMIC I Regular
Interest is reduced to zero,
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provided, however, that REMIC I Regular Interest LT-P shall
not be reduced until the Distribution Date immediately
following the expiration of the latest Prepayment Penalty as
identified on the Schedule of Mortgage Loans or any
Distribution Date thereafter, at which point such amount shall
be distributed to REMIC I Regular Interest L-TP, until $100
has been distributed pursuant to this clause;
(b) to the Holders of REMIC I Regular ▇▇▇▇▇▇▇▇ ▇▇-▇▇,
REMIC I Regular ▇▇▇▇▇▇▇▇ ▇▇-▇▇, REMIC I Regular ▇▇▇▇▇▇▇▇
▇▇-▇▇, REMIC I Regular Interest LT-M1, REMIC I Regular
Interest LT-B1, REMIC I Regular Interest LT-B2, and REMIC I
Regular Interest LT-B3, 1.00% of such remainder (other than
amounts payable under clause (d) below), in the same
proportion as principal payments are allocated to the
Corresponding Certificates, until the Uncertificated Principal
Balances of such REMIC I Regular Interests are reduced to
zero;
(c) to the Holders of REMIC I Regular Interest LT-ZZ,
1.00% of such remainder (other than amounts payable under
clause (d) below), until the Uncertificated Principal Balance
of such REMIC I Regular Interest is reduced to zero; then
(d) any remaining amount to the Holders of the Class
R Certificates (in respect of the Class R-I Interest); and
On each Distribution Date, all amounts representing Prepayment
Penalties in respect of the Mortgage Loans received during the related
Collection Period will be distributed by REMIC I to the Holders of REMIC I
Regular Interest I-LTP. The payment of the foregoing amounts to the Holders of
REMIC I Regular Interest I-LTP shall not reduce the Uncertificated Principal
Balance thereof.
(b) On each Distribution Date, after payment of the Trustee
Fee and any Senior Trustee Expenses then due, the Trustee shall
withdraw from the Certificate Account the Available Distribution Amount
for REMIC II to make the distribution thereof in the following order of
priority:
(i) to pay to the Certificate Insurer the Certificate
Insurance Premium then due;
(ii) to make payments in respect of interest to the
Certificates and payments to the Certificate Insurer in the following amounts
and order of priority;
(A) to the Class A Certificates, the Accrued Certificate
Interest and any unpaid Accrued Certificate Interest from the prior Distribution
Date allocable to each such class, on a PRO RATA basis based on the entitlement
of each such class;
(B) to the Certificate Insurer, any Reimbursement Amount;
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(C) to the Class M-1 Certificates, the Accrued Certificate
Interest allocable to the Class M-1 Certificates;
(D) to the Class B-1 Certificates, the Accrued Certificate
Interest allocable to the Class B-1 Certificates;
(E) to the Class B-2 Certificates, the Accrued Certificate
Interest allocable to the Class B-2 Certificates; and
(F) to the Class B-3 Certificates, the Accrued Certificate
Interest allocable to the Class B-3 Certificates.
(iii) on each Distribution Date (x) prior to the Stepdown Date
or (y) on which a Trigger Event is in effect, to Holders of the related Class or
Classes of Certificates then entitled to distributions of principal and to the
Certificate Insurer after making distributions pursuant to clauses (i) and (ii)
above, to the extent of the Principal Distribution Amount, in the following
amounts and order of priority:
(A) to the Class A Certificates until the Certificate Balances
thereof have been reduced to zero concurrently as follows:
(1) 50% of the Principal Distribution Amount,
sequentially in the following order, to the Class A-1 Certificates and
the Class A-2 Certificates, until the Certificate Balance of each such
Class has been reduced to zero;
(2) 50% of the Principal Distribution Amount to the
Class A-3 Certificates until the Certificate Balance of each such Class
has been reduced to zero;
(B) to the Certificate Insurer, the amount of any
Reimbursement Amount not reimbursed pursuant to clause (ii)(B) above;
(C) to the Class M-1 Certificates, until the Certificate
Balance of thereof has been reduced to zero;
(D) to the Class B-1 Certificates, until the Certificate
Balance of thereof has been reduced to zero;
(E) to the Class B-2 Certificates, until the Certificate
Balance of thereof has been reduced to zero;
(F) to the Class B-3 Certificates, until the Certificate
Balance of thereof has been reduced to zero;
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(iv) on each Distribution Date (x) on or after the Stepdown
Date and (y) on which a Trigger Event is not in effect, to Holders of the
related Class or Classes of Certificates then entitled to distributions of
principal and to the Certificate Insurer after making distributions pursuant to
clauses (i) and (ii) above, to the extent of the Principal Distribution Amount,
in the following amounts and order of priority:
(A) to the Class A Certificates until the Certificate Balances
thereof have been reduced to zero concurrently as follows:
(1) 50% of the lesser of (x) Principal Distribution
Amount and (y) the Class A Principal Distribution Amount, sequentially
in the following order, to the Class A-1 Certificates and the Class A-2
Certificates, until the Certificate Balance of each such Class has been
reduced to zero;
(2) 50% of the lesser of (x) the Principal
Distribution Amount and (y) the Class A Principal Distribution Amount,
to the Class A-3 Certificates until the Certificate Balance of each
such Class has been reduced to zero;
(B) to the Certificate Insurer, the amount of any
Reimbursement Amount not reimbursed pursuant to clause (ii)(B) above;
(C) to the Class M-1 Certificates, the lesser of (x) the
remaining Principal Distribution Amount and (y) the Class M-1 Principal
Distribution Amount, until the Certificate Balance of thereof has been reduced
to zero;
(D) to the Class B-1 Certificates, the lesser of (x) the
remaining Principal Distribution Amount and (y) the Class B-1 Principal
Distribution Amount, until the Certificate Balance of thereof has been reduced
to zero;
(E) to the Class B-2 Certificates, the lesser of (x) the
remaining Principal Distribution Amount and (y) the Class B-2 Principal
Distribution Amount, until the Certificate Balance of thereof has been reduced
to zero;
(F) to the Class B-3 Certificates, the lesser of (x) the
remaining Principal Distribution Amount and (y) the Class B-3 Principal
Distribution Amount, until the Certificate Balance of thereof has been reduced
to zero;
(v) on each Distribution Date, the Net Monthly Excess Cashflow
(or, in the case of clause (A) below, the Net Monthly Excess Cashflow exclusive
of any Excess Subordinated Amount) shall be distributed as follows:
(A) to the Holders of Certificates then entitled to receive
distributions in respect of principal, in an amount equal to any Extra Principal
Distribution Amount which shall be included in the Principal Distribution Amount
payable to such Holders;
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(B) to the Class M-1 Certificates, the Interest Shortfall
Carryforward Amount allocable to the Class M-1 Certificates;
(C) to the Class B-1 Certificates, the Interest Shortfall
Carryforward Amount allocable to the Class B-1 Certificates;
(D) to the Class B-2 Certificates, the Interest Shortfall
Carryforward Amount allocable to the Class B-2 Certificates;
(E) to the Class B-3 Certificates, the Interest Shortfall
Carryforward Amount allocable to the Class B-3 Certificates;
(F) to the Reserve Fund from amounts otherwise payable to the
Class X Certificates, and then from the Reserve Fund to pay the Basis Risk Carry
Forward Amounts allocable to the Class A Certificates, the Class M-1
Certificates and the Class B Certificates in the same order of priority in which
Accrued Certificate Interest is allocated among such Certificates with the
allocation to the Class A Certificates being PRO RATA based on their respective
Basis Risk Carry Forward Amounts;
(vi) on each Distribution Date, all amounts representing
Prepayment Penalities from the Household Mortgage Loans received during the
related Collection Period will be distributed to the Holders of the Class P
Certificates.
(vii) to pay to the Trustee and to each Servicer, PRO RATA,
amounts reimbursable pursuant to this Agreement in excess of amounts paid to the
Trustee or the Servicers as described under the first paragraph of SECTION
7.06(B) and not reimbursable to the Servicers under SECTION 8.04(D)(I);
(viii) to pay to the Class X Certificates, the Accrued
Certificate Interest and the Overcollateralization Reduction Amount for such
Distribution Date; and
(ix) to pay to the Holder of the Class R Certificates, any
amount remaining in REMIC II; provided that if such Distribution Date is the
Distribution Date immediately following the expiration of the latest Prepayment
Penalty term as identified on the Schedule of Mortgage Loans or any Distribution
Date thereafter, then any such remaining amounts will be distributed first, to
the Holders of the Class P Certificates, until the Certificate Balance thereof
has been reduced to zero; and second, to the Holders of the Class R
Certificates.
(c) On each Distribution Date, following the distribution of
the Available Distribution Amount pursuant to SECTION 7.06(B), the Trustee shall
withdraw from the Certificate Insurance Account the amount of any Insured
Payment received by it for such Distribution Date and shall distribute to the
holders of the Class A Certificates, as applicable, (A) as interest, any portion
of such Insured Payment made in respect of an Insured Amount of interest for
such Class or in respect of a Preference Amount of interest for such Class and
(B) as principal, in reduction of the Certificate Balances of the Class A
Certificates, any portion of such Insured Payment made in respect of an Insured
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Amount of principal or made in respect of a Preference Amount of principal for
the Class A Certificates; PROVIDED, HOWEVER, that any Insured Payment made in
respect of an Insured Amount of principal shall be allocated to the Class A
Certificates.
(d) All distributions made to the Certificateholders on each
Distribution Date will be made on a PRO RATA basis among the Certificateholders
of the respective Class of record on the next preceding Record Date based on the
Percentage Interest represented by their respective Certificates, and shall,
except for the final payment on such Certificates, be made either (x) by wire
transfer of immediately available funds to the account of such Certificateholder
as shall appear on the Register without the presentation or surrender of the
Certificate or the making of any notation thereon, at a bank or other entity
having appropriate facilities therefor as directed by the Certificateholder in
writing or (y) in the event that no wire instructions are provided to the
Trustee, by check mailed by first class mail to such Certificateholder at the
address of such holder appearing in the Register.
7.07 ALLOCATION OF REALIZED LOSSES
(a) All Realized Losses on the Mortgage Loans allocated to any
REMIC I Regular Interest pursuant to Section 7.07(b) on the Mortgage
Loans shall be allocated by the Trustee on each Distribution Date as
follows: first, to Net Monthly Excess Cashflow; second, to the Class X
Certificates, until the Certificate Balance thereof has been reduced to
zero, third, to the Class B-3 Certificates, until the Certificate
Balance thereof has been reduced to zero; fourth, to the Class B-2
Certificates, until the Certificate Balance thereof has been reduced to
zero; fifth, to the Class B-1 Certificates, until the Certificate
Balance thereof has been reduced to zero; sixth, to the Class M-1
Certificates, until the Certificate Balance thereof has been reduced to
zero; and seventh, if, but only if a Certificate Insurer Default has
occurred and is continuing on such Distribution Date, to the Class A
Certificates, on a PRO RATA basis until the Realized Loss amount is
zero. Prior to the allocation of Realized Losses to the Class A
Certificates the Trustee shall complete and deliver to the Certificate
Insurer the Certificate Insurer Notice and demand payment of such
Realized Losses. All Realized Losses to be allocated to the Certificate
Balances of all Classes on any Distribution Date shall be so allocated
after the actual distributions to be made on such date as provided
above. All references above to the Certificate Balance of any Class of
Certificates shall be to the Certificate Balance of such Class
immediately prior to the relevant Distribution Date, before reduction
thereof by any Realized Losses, in each case to be allocated to such
Class of Certificates, on such Distribution Date.
Any allocation of Realized Losses to a Class of Certificates
(other than the Class X Certificates) on any Distribution Date shall be made by
reducing the Certificate Balance thereof by the amount so allocated; any
allocation of Realized Losses to a Class
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X Certificate shall be made by reducing the amount otherwise payable in respect
thereof pursuant to Section 7.06(b)(viii).
All Realized Losses allocated to a Class of Certificates
hereunder will be allocated among the, Certificates of such Class in proportion
to the Percentage Interests evidenced thereby.
(b) All Realized Losses on the Mortgage Loans shall be
allocated by the Trustee on each Distribution Date to the following
REMIC I Regular Interests in the specified percentages, as follows:
first, to Uncertificated Accrued Interest payable to the REMIC I
Regular Interest LT-AA and REMIC I Regular Interest LT-ZZ up to an
aggregate amount equal to the REMIC I Interest Loss Allocation Amount,
98% and 2%, respectively; second, to the Uncertificated Principal
Balances of the REMIC I Regular Interest LT-AA and REMIC I Regular
Interest LT-ZZ up to an aggregate amount equal to the REMIC I Principal
Loss Allocation Amount, 98% and 2%, respectively; third, to the
Uncertificated Principal Balances of REMIC I Regular Interest LTAA,
REMIC I Regular Interest LT-B3 and REMIC I Regular Interest LT-ZZ, 98%,
1% and 1%, respectively, until the Uncertificated Balance of REMIC I
Regular Interest LT-B3 has been reduced to zero; fourth to the
Uncertificated Principal Balances of REMIC I Regular Interest LTAA,
REMIC I Regular Interest LT-B2 and REMIC I Regular Interest LT-ZZ, 98%,
1% and 1%, respectively, until the Uncertificated Balance of REMIC I
Regular Interest LT-B2 has been reduced to zero; fifth to the
Uncertificated Principal Balances of REMIC I Regular Interest LT-AA,
REMIC I Regular Interest LT-B1 and REMIC I Regular Interest LT-ZZ, 98%,
1% and 1%, respectively, until the Uncertificated Balance of REMIC I
Regular Interest LT-B1 has been reduced to zero; and sixth to the
Uncertificated Principal Balances of REMIC I Regular Interest LT-AA,
REMIC I Regular Interest LT-M1 and REMIC I Regular Interest LT-ZZ, 98%,
1% and 1%, respectively, until the Uncertificated Balance of REMIC I
Regular Interest LT-M1 has been reduced to zero.
7.08 STATEMENTS.
(a) Based solely upon the information provided to it by the
Servicers pursuant to Section 7.08(d) hereof, not later than each Distribution
Date, the Trustee shall make available on its website initially located at
▇▇▇.▇▇▇▇▇▇▇▇.▇▇▇/▇▇▇▇▇▇ to the Depositor, each Owner, the Servicers, the
Certificate Insurer and the Rating Agencies a statement setting forth the
following information:
(i) the aggregate amount on deposit in the Certificate Account
on such Distribution Date;
(ii) the Accrued Certificate Interest, Interest Shortfall
Carryforward Amount, if any, the Basis Risk Carry Forward Amount, if
any, and the Principal Distribution Amount, with respect to each Class
individually, all Classes of the
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Offered Certificates in the aggregate, all Classes of Class A
Certificates in the aggregate and all Classes of Class B Certificates
in the aggregate;
(iii) the Pass-Through Rate for each Class of Certificates
applicable to the related Accrual Period and LIBOR applicable to the
Certificates with respect to such Distribution Date;
(iv) the application of the amounts described in clause (ii)
above to the allocation and distribution of payment to the holders of
Class A, Class M-1 and Class B Certificates and the amount of
Prepayment Penalties attributable to the Household Mortgage Loans
distributable to the Class P Certificates, on the next Distribution
Date in accordance with this Agreement;
(v) the Certificate Balance of each Class of Class A
Certificates and Class B Certificates and the Class M-1 Certificates,
the aggregate amount of the interest and principal of each Class of
Offered Certificates to be paid on such Distribution Date and the
remaining Certificate Balance of each Class of Offered Certificates
following any such payment;
(vi) the amount of Insured Payments, if any;
(vii) the amount, if any, of any Realized Losses for the
related Collection Period in the aggregate, for each Class of Offered
Certificates and the amount of Cumulative Realized Losses as of the
last day of the related Collection Period;
(viii) whether a Fairbanks Termination Trigger Event, Wilshire
Termination Trigger Event or a GreenPoint Termination Trigger Event has
occurred;
(ix) the amount of the distribution with respect to each Class
of Offered Certificates (based on a Certificate in the original
principal amount of $1,000);
(x) the amount of such distribution allocable to principal of
the Mortgage Loans, separately identifying the aggregate amount of any
Principal Prepayments, Loan Purchase Price amounts or other recoveries
of principal included therein;
(xi) the amount of such distribution allocable to interest on
the Mortgage Loans (based on a Certificate in the original principal
amount of $1,000);
(xii) the principal amount, if any, of each Class of the
Offered Certificates (based on a Certificate in the original principal
amount of $1,000) which will be outstanding after giving effect to any
payment of principal on such Distribution Date;
(xiii) the aggregate Pool Balance of all Mortgage Loans, as of
the last day of the related Collection Period;
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(xiv) based upon information furnished by the Depositor such
information as may be required by Section 6049(d)(7)(C) of the Code to
assist the Certificateholders in computing their market discount;
(xv) the weighted average interest rate of the Mortgage Loans;
(xvi) the weighted average remaining term of the Mortgage
Loans;
(xvii) the number and Stated Principal Balance of the Mortgage
Loans that were 60 days or more Delinquent for each of the preceding
three months as of the close of business on the last Business Day of
the calendar month next preceding the Distribution Date;
(xviii) such other information as the Depositor may reasonably
request with respect to Mortgage Loans that are Delinquent;
(xix) the Stated Principal Balance of the largest Mortgage
Loans outstanding;
(xx) the number, aggregate Stated Principal Balances and
percentage of Mortgage Loans that are: (A) 30-59 days Delinquent, (B)
60-89 days Delinquent and (C) 90-119 days Delinquent, (D) 120-149 days
Delinquent, (E) 150-179 days Delinquent and (F) 180 or more days
Delinquent, as of the close of business on the last Business Day of the
calendar month next preceding the Distribution Date and the aggregate
number and aggregate Stated Principal Balance of such Mortgage Loans;
(xxi) the status, the number, and the Stated Principal
Balances of all Mortgage Loans that are in foreclosure proceedings as
of the close of business on the last Business Day of the calendar month
next preceding such Distribution Date;
(xxii) the number of Mortgagors and the Stated Principal
Balances of the related Mortgages for all Mortgage Loans involved in
bankruptcy proceedings and whether such Mortgage Loans are (A) 30-59
days Delinquent, (B) 60-89 days Delinquent and (C) 90-119 days
Delinquent, (D) 120-149 days Delinquent, (E) 150-179 days Delinquent
and (F) 180 or more days Delinquent, as of the close of business on the
last Business Day of the calendar month next preceding such
Distribution Date;
(xxiii) the number of Mortgagors and the Stated Principal
Balances of the related Mortgages for all Mortgage Loans involved in
foreclosure proceedings and whether such Mortgage Loans are (A) 30-59
days Delinquent, (B) 60-89 days Delinquent and (C) 90-119 days
Delinquent, (D) 120-149 days Delinquent, (E) 150-179 days Delinquent
and (F) 180 or more days Delinquent, as of the close of business on the
last Business Day of the calendar month next preceding such
Distribution Date;
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(xxiv) the existence and status of any Mortgaged Properties
for all Mortgage Loans as to which title has been taken in the name of,
or on behalf of the Trustee, as of the close of business of the last
Business Day of the month next preceding the Distribution Date;
(xxv) the book value of any real estate acquired through
foreclosure or grant of a deed in lieu of foreclosure for all Mortgage
Loans as of the close of business on the last Business Day of the
calendar month next preceding the Distribution Date;
(xxvi) the number of Mortgage Loans;
(xxvii) identifying the aggregate amount received from:
a. Curtailments;
b. voluntary payoffs;
c. Involuntary Payoffs (the amount of Net Liquidation
Proceeds applicable to the unpaid principal balance
from the loan); and
d. Mortgage Loans purchased from the Trust;
as of the close of business on the last Business Day of the
related Collection Period;
(xxviii) the number and Stated Principal Balance of all
Mortgage Loans that are subject to loss mitigation as of the close of
business on the last Business Day of the calendar month next preceding
the Distribution Date;
(xxix) the number and Stated Principal Balance of Mortgage
Loans that are being contested because of Section 32 of the Truth in
Lending Act;
(xxx) the amount of current and cumulative Realized Losses
(separately identifying principal and interest losses) from following
resolution types:
a. REO Property sold;
b. short sale;
c. deed in lieu;
d. no equity second mortgages; and
e. other;
as of the close of business on the last Business Day of the
related Collection Period;
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(xxxi) the number and Pool Balance with respect to each
product type of all Mortgage Loans in Chapter 13 of the United States
Bankruptcy Code ("CHAPTER 13 LOANS") separately identifying:
a. those Chapter 13 Loans that are currently meeting
their payment plan;
b. those Chapter 13 Loans that are 1 to 2 payments
behind their payment plan;
c. those Chapter 13 Loans that are 2 to 3 payments
behind their payment plan;
d. those Chapter 13 Loans that are greater than 3
payments behind their payment plan;
e. those Chapter 13 Loans that are greater than 4
payments behind their payments; and
f. those Chapter 13 Loans that are greater than 5
payments behind their payments;
(xxxii) the calculations and results of calculations of each
Stepdown Date test performed;
(xxxiii) the number and Stated Principal Balance of each
Mortgage Loan purchased pursuant to SECTION 8.21; and
(xxxiv) any other information that the Depositor, the Trustee,
the Certificate Insurer or the relevant Servicer deems necessary.
(b) The Trustee shall report to the Depositor, the Certificate
Insurer and each Certificateholder, with respect to the amount on deposit in the
Certificate Account and the identity of the investments included therein, as the
Depositor may from time to time reasonably request. Without limiting the
generality of the foregoing, the Trustee shall, at the request of the Depositor
or the Certificate Insurer transmit promptly to the Depositor and the
Certificate Insurer copies of all accounting of receipts in respect of the
Mortgage Loans furnished to it by each Servicer and shall notify the Depositor
if any Remittance Amount has not been received by the Trustee when due.
(c) The Trustee shall report to the Depositor, the Certificate
Insurer and each Certificateholder with respect to any written notices it may
from time to time receive which provide an Authorized Officer with actual
knowledge that certain of the statements set forth in this Agreement are
inaccurate.
(d) Each of Fairbanks and Wilshire shall furnish to the
Trustee, and each Owner of any Class X Certificate, in each case during the term
of this Agreement, (i)
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such information with respect to the Mortgage Loans serviced by such Servicer as
is necessary to prepare its report provided for in SECTION 7.08, (ii) with
respect to the Contracts, Wilshire shall deliver to the Trustee a copy of the
monthly report delivered to Wilshire from GreenPoint pursuant to the GreenPoint
Servicing Agreement, and (iii) periodic, special or other reports or information
not specifically provided for herein, as may be necessary, reasonable, or
appropriate with respect to the Trustee or otherwise with respect to the
purposes of this Agreement, all such reports or information to be provided by
and in accordance with such applicable instructions and directions as the
Trustee may reasonably require; PROVIDED, that each such Servicer shall be
entitled to be reimbursed by the requesting party for the fees and actual
expenses associated with providing the reports described in clause (iii), if
such reports are not generally produced in the ordinary course of business,
PROVIDED that any reports requested by the Trustee (other than at the request of
a third party who shall be responsible for such fees and expenses) shall be
reimbursed by the Trust as Trust Expenses. The Trustee's responsibility for
providing the report described in SECTION 7.08 shall be limited to the
availability, timeliness and accuracy of the information provided therefor by
the relevant Servicer.
7.09 REPORTS OF FORECLOSURE AND ABANDONMENT OF MORTGAGED
PROPERTY.
Each year the Trustee shall execute and return to Fairbanks
and Wilshire, as applicable, for filing the reports of foreclosures and
abandonments of any Mortgaged Property prepared by such Servicer required by
Section 6050J of the Code. In order to facilitate this reporting process, each
of Fairbanks and Wilshire, on or before January 15th of each year, shall provide
to the Trustee reports as to (i) any Mortgaged Property in which the Servicer on
behalf of the Trust Fund acquired an interest in a Mortgaged Property through
foreclosure or other comparable conversion in full or partial satisfaction of
the Mortgage Loan, or (ii) any Mortgaged Property with respect to which the
related Servicer knew or had reason to know that such Mortgaged Property had
been abandoned. The reports from Fairbanks and Wilshire shall be in form and
substance sufficient to enable the Trustee to meet the reporting requirements
imposed by such Section 6050J.
7.10 RESERVE FUND.
(a) No later than the Closing Date, the Trustee shall
establish and maintain a separate, segregated trust account titled, "Reserve
Fund, JPMorgan Chase Bank, in trust for the registered holders of GSRPM Mortgage
Loan Trust 2003-1, Mortgage Pass-Through Certificates, Series 2003-1." On the
Closing Date, the Depositor will deposit, or cause to be deposited, into the
Reserve Fund $1,000.
(b) On each Distribution Date as to which there is a Basis
Risk Carry Forward Amount payable to the Certificates, the Trustee has been
directed by the Majority Class X Certificateholder, pursuant to SECTION 7.10(d)
hereof, to, and therefore will, deposit into the Reserve Fund the amounts
described in Section 7.06(b)(v)(F), rather than distributing such amounts to the
Class X Certificateholders. On each such
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Distribution Date, the Trustee shall hold all such amounts for the benefit of
the Holders of the Class A Certificates, Class M-1 Certificates and Class B
Certificates, and will distribute such amounts to the Holders of the Class A
Certificates, Class M-1 Certificates and the Class B Certificates in the amounts
and priorities set forth in Section 7.06(v). If no Basis Risk Carry Forward
Amounts are payable on a Distribution Date, the Trustee shall deposit into the
Reserve Fund on behalf of the Class X Certificateholders, from amounts otherwise
distributable to the Class X Certificateholders, an amount such that when added
to other amounts already on deposit in the Reserve Fund, the aggregate amount on
deposit therein is equal to $1,000.
(c) For federal and state income tax purposes, the Class X
Certificateholders will be deemed to be the owners of the Reserve Fund and all
amounts deposited into the Reserve Fund shall be treated as amounts distributed
by REMIC II to the Holders of the Class X Certificates. Upon the termination of
the Trust Fund, or the payment in full of the Class A Certificates, Class M-1
and Class B Certificates, all amounts remaining on deposit in the Reserve Fund
will be released by the Trust Fund and distributed to the Class X
Certificateholders or their designees, on a PRO RATA basis. The Reserve Fund
will be part of the Trust Fund but not part of any REMIC and any payments to the
Holders of the Class A Certificates, Class M-1 Certificates or Class B
Certificates of Basis Risk Carry Forward Amounts will not be payments with
respect to a "regular interest" in a REMIC within the meaning of Code Section
860(G)(a)(1).
(d) By accepting a Class X Certificate, each Class X
Certificateholder hereby agrees to direct the Trustee, and the Trustee hereby is
directed, to deposit into the Reserve Fund the amounts described above on each
Distribution Date as to which there is any Basis Risk Carry Forward Amount
rather than distributing such amounts to the Class X Certificateholders. By
accepting a Class X Certificate, each Class X Certificateholder further agrees
that such direction is given for good and valuable consideration, the receipt
and sufficiency of which is acknowledged by such acceptance.
(e) At the direction of the Majority Class X
Certificateholder, the Trustee shall direct any depository institution
maintaining the Reserve Fund to invest the funds in such account in one or more
Eligible Investments bearing interest or sold at a discount, and maturing,
unless payable on demand, (i) no later than the Business Day immediately
preceding the date on which such funds are required to be withdrawn from such
account pursuant to this Agreement, if a Person other than the Trustee or an
Affiliate manages or advises such investment, and (ii) no later than the date on
which such funds are required to be withdrawn from such account pursuant to this
Agreement, if the Trustee or an Affiliate manages or advises such investment. If
no investment direction of the Majority Class X Certificateholder with respect
to the Reserve Fund is received by the Trustee, the Trustee shall invest the
funds in such account in Eligible Investments managed by the Trustee or an
Affiliate of the kind described in clause (f) of the definition of Eligible
Investments. All income and gain earned upon such investment shall be deposited
into the Reserve Fund. The amount of any loss shall be paid by the Majority
Class X Certificateholder.
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(f) For federal tax return and information reporting, the
right of the Class A Certificateholders, the Class M-1 and Class B
Certificateholders to receive payments from the Reserve Fund in respect of any
Basis Risk Carry Forward Amount shall be assigned a value of zero.
ARTICLE VIII
SERVICING AND ADMINISTRATION OF MORTGAGE LOANS BY FAIRBANKS AND WILSHIRE
8.01 FAIRBANKS AND WILSHIRE.
Acting directly, beginning on the Closing Date, Fairbanks and
Wilshire shall service and administer the Fairbanks Mortgage Loans and Wilshire
Mortgage Loans, as applicable in accordance with this Agreement and Accepted
Servicing Practices and shall have full power and authority, acting alone, to do
or cause to be done any and all things in connection with such servicing and
administration which as such Servicer may deem necessary or desirable subject to
the provisions of this Agreement and the REMIC Provisions; provided, however,
that the reference to Wilshire Mortgage Loans in this Article VIII (other than
Section 8.04 hereof) shall not include the Contracts serviced by GreenPoint
pursuant to the GreenPoint Servicing Agreement and master serviced by Wilshire
pursuant to Article IX hereof.
The obligations of each of Fairbanks and Wilshire hereunder to
service and administer the Mortgage Loans shall be limited to the Fairbanks
Mortgage Loans and the Wilshire Mortgage Loans, respectively; and with respect
to the duties and obligations of each Servicer, references herein to related
"Mortgage Loans" shall be limited to the Fairbanks Mortgage Loans (and the
related proceeds thereof and related REO Properties) in the case of Fairbanks
and the Wilshire Mortgage Loans (and the related proceeds thereof and related
REO Properties) in the case of Wilshire and in no event shall any Servicer have
any responsibility or liability with respect to any of the other Mortgage Loans.
Each of Fairbanks and Wilshire will hold the Servicing Files,
but not the Custodial Files for each Mortgage Loan serviced by such Servicer. To
the extent that such Servicer needs possession of any document in the Custodial
File for purposes of enforcing a Mortgage Loan, such Servicer agrees that it
will act as the custodian and bailee and trustee of such documents for the
benefit of the Trustee and the Owners during the term of this Agreement.
Notwithstanding anything to the contrary set forth in this Agreement, each of
Fairbanks and Wilshire shall bear for its own account all costs and expenses
related to its storage and holding of any Custodial Files and Mortgage Loan
Documents related to any Mortgage Loan serviced by such Servicer, without any
right to reimbursement by the Trust or otherwise from the related Mortgage
Loans, and no such amount shall constitute Servicing Advances; PROVIDED,
however, that no such Servicer shall be obligated to pay any costs, expenses or
fees for the storage and holding of the
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Custodial Files pursuant to the Fairbanks Custodial Agreement or the Wilshire
Custodial Agreement.
Without limiting the generality of the foregoing, but subject
to SECTIONS 8.09 and 8.10, the relevant Servicer in its own name may be
authorized and empowered pursuant to a power of attorney, substantially in the
form of the power of attorney attached hereto as EXHIBIT E hereto executed and
delivered by the Trustee to execute and deliver, and may be authorized and
empowered by the Trustee, to execute and deliver, on behalf of itself, the
Owners and the Trustee or any of them, (i) any and all instruments of
satisfaction or cancellation or of partial or full release or discharge and all
other comparable instruments with respect to the related Mortgage Loans and with
respect to the Mortgaged Properties related to such Mortgage Loans, (ii) to
institute foreclosure proceedings or obtain a deed in lieu of foreclosure so as
to effect ownership of any Mortgaged Property related to Mortgage Loan serviced
by such Servicer on behalf of the Trustee, and (iii) to hold title to or dispose
any Mortgaged Property related to any Mortgage Loan serviced by such Servicer
upon such foreclosure or deed in lieu of foreclosure on behalf of the Trustee;
PROVIDED, HOWEVER, that to the extent any instrument described in CLAUSE (I)
preceding would be delivered by Fairbanks or Wilshire, as the case may be,
outside of Accepted Servicing Practices such Servicer shall, prior to executing
and delivering such instrument, obtain the prior written consent of the Trustee
(which consent shall only be given by the Trustee upon receipt of a REMIC
Opinion addressed to the Trustee stating that the execution of such instrument
shall not cause either REMIC I or REMIC II to fail to qualify as a REMIC.). The
Trustee shall execute any documentation furnished to it by Fairbanks or Wilshire
for recordation by such Servicer in the appropriate jurisdictions as shall be
necessary to effectuate the foregoing. Subject to SECTIONS 8.09 and 8.10, the
Trustee shall execute any authorizations and other documents as Fairbanks or
Wilshire shall reasonably request that are furnished to the Trustee to enable
such Servicer to carry out its servicing and administrative duties hereunder, or
shall execute and deliver powers of attorney enabling such Servicer to execute
such authorizations and other documents on behalf of the Trustee. The Trustee
shall be indemnified by the related Servicer for all liabilities, costs and
expenses incurred by the Trustee in connection with the misuse of any such power
of attorney by such Servicer.
Each of Fairbanks and Wilshire shall give prompt notice to the
Trustee, the Certificate Insurer and the Depositor of any action, of which such
Servicer has actual knowledge, to (i) assert a claim against the Trust or (ii)
assert jurisdiction over the Trust.
Servicing Advances incurred or made by Fairbanks or Wilshire
in connection with the servicing of the related Mortgage Loans on any Mortgaged
Property shall be recoverable by such Servicer to the extent described in
SECTIONS 8.04 AND 8.05.
Each of Fairbanks and Wilshire may in connection with its
duties as a Servicer hereunder enter into transactions with any of its
Affiliates relating to the Mortgage Loans serviced by it; provided, that (x)
such Servicer acts (i) in accordance with Accepted Servicing Practices and the
terms of this Agreement, (ii) in the ordinary
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course of business of such Servicer; and (y) the terms of such transaction are
no less favorable to such Servicer that it would obtain in a comparable
arm's-length transaction with a Person that is not an Affiliate of such
Servicer.
8.02 COLLECTION OF CERTAIN MORTGAGE LOAN PAYMENTS.
(a) (i) With respect to any Fairbanks Mortgage Loan which
Fairbanks determines may be subject to the Home Ownership Equity
Protection Act of 1994 and any regulations related thereto ("HOEPA"),
which Mortgage Loan is in default, but prior to the commencement of any
loss mitigation procedures or foreclosure proceedings, Fairbanks shall
(A) review the related Custodial File to determine whether or not the
Custodial File contains the disclosure documents required by HOEPA,
whether or not such documents were executed by the related
Mortgagor(s), and whether or not such documents were executed three or
more days in advance of closing and (B) inform the Trustee and the
Depositor if such timely and executed disclosure documents are not in
the Custodial File. Further, prior to the commencement of any loss
mitigation procedures with respect to such Mortgage Loan, Fairbanks
shall notify those servicing personnel involved in loss mitigation
related to such Fairbanks Mortgage Loan as to whether or not any such
disclosure documentation is defective or missing.
(ii) With respect to any Wilshire Mortgage Loan, prior to the
commence of any foreclosure proceeding or litigation originally
initiated by Wilshire, Wilshire shall complete the HOEPA calculation
form attached hereto as Exhibit N for such Wilshire Mortgage Loan. If
the calculation is positive, Wilshire shall (A) review with its
internal compliance personnel the related Custodial File to determine
wither or not the Custodial File contains the disclosure document
required by HOEPA (but not a calculation of the accuracy thereof),
whether or not such document appears to have been executed by the
related Mortgagor(s) and whether or not such document appears to have
been executed three or more days in advance of closing and (B) inform
the Depositor and the Trustee if such timely and executed disclosure
document is not included in the Custodial File. Further, prior to the
commencement of any foreclosure proceeding or litigation with respect
to such Wilshire Mortgage Loan, Wilshire shall notify those servicing
personnel involved in loss mitigation related to the Wilshire Mortgage
Loan as to whether or not any such disclosure documentation is
defective to the extent described above or is missing.
(b) Consistent with SECTION 8.02(A), the relevant Servicer
may, in its discretion, subject to Accepted Servicing Practices, waive
or permit to be waived any late payment charge or assumption fee or,
solely to the extent that the related Mortgage Loan is in default and
such waiver would be necessary to bring such Mortgage Loan current, any
Prepayment Penalty or default interest in connection with the Principal
Prepayment of a Mortgage Loan or any other fee or charge which the
relevant Servicer would be entitled to retain hereunder as servicing
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compensation. No Servicer shall be liable for waiving any Prepayment
Penalty if such Servicer shall have failed to receive any document or
information necessary to confirm the existence or amount of such
Prepayment Penalty.
(c) Neither Fairbanks nor Wilshire shall consent to any
waiver, modification, or amendment of the term of any Mortgage Loan
serviced by such Servicer other than pursuant to SECTION 8.02(B) except
as permitted under SECTION 8.09 or 8.10.
8.03 LIABILITY OF SERVICER; INDEMNIFICATION.
(a) Each of Fairbanks and Wilshire agrees to indemnify and
hold the Trustee, the Depositor, the Certificate Insurer, each Owner
and their respective Affiliates, successors and assigns harmless
against any and all claims, losses, penalties, fines, forfeitures,
reasonable legal fees and related costs, judgments, and any other
actual costs, fees and expenses that the Trustee, the Depositor, the
Certificate Insurer, each or any Affiliate, successor or assign of any
of them may sustain to the extent caused by the failure of the relevant
Servicer to perform any of its material duties hereunder and to service
the related Mortgage Loans in compliance with the terms of this
Agreement or due to the fraud, negligence or willful misfeasance of the
relevant Servicer (a "SERVICING CLAIM"). Each of Fairbanks and Wilshire
shall assume (with the consent of the Trustee, the Certificate Insurer
and the Depositor, such consent not to be unreasonably withheld,
delayed or conditioned) the defense of any Servicing Claim and pay all
expenses in connection therewith, including reasonable counsel fees,
and promptly pay, discharge and satisfy any judgment or decree which
may be entered against Fairbanks, Wilshire, the Trustee, any Owner or
any Affiliate, successor or assign of any of them as a result of a
claim related to the failure of Fairbanks or Wilshire, as the case may
be, to perform its material duties.
Anything in this Agreement to the contrary notwithstanding, in
no event shall any Servicer be liable for special, indirect or
consequential loss or damage of any kind whatsoever (including, but not
limited to, lost profits), even if such Servicer has been advised of
the likelihood of such loss or damage and regardless of the form of
action.
(b) Except as otherwise expressly provided herein, neither
Fairbanks nor Wilshire shall be under any obligation to appear in,
prosecute or defend any legal action that (i) is not incidental to its
duties to service the related Mortgage Loans in accordance with this
Agreement, or (ii) may involve allegations against the Trustee, the
Depositor, the Certificate Insurer, any Owner or any Affiliate,
successor or assign of any of them or any prior owners or servicers of
the related Mortgage Loans; PROVIDED, HOWEVER, that Fairbanks and
Wilshire, as the case may be, may institute foreclosure proceedings
and, with the prior written consent of the Trustee, the Certificate
Insurer and the Depositor, undertake any legal action that it may deem
necessary or desirable in respect of this Agreement and the
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rights and duties of the parties hereto (with the reasonable legal
expenses and costs of such action and any liability resulting therefrom
treated as expenses, costs and liabilities for which the Trust will be
liable and for which the relevant Servicer will be entitled to
reimbursement upon request as Trust Expenses); and PROVIDED, FURTHER,
that the foregoing shall not protect the relevant Servicer against any
breach of representation or warranty or failure to perform its
obligations in strict compliance with any standard of care set forth in
this Agreement. In the event that any Servicer agrees, at the request
of the Trustee or the Depositor to act on behalf of such party in any
dispute or litigation that is not incidental to such Servicer's duties
hereunder and that relates to the origination of a Mortgage Loan, such
party shall pay all expenses associated with the management and defense
of such claim.
(c) Notwithstanding any provision herein to the contrary,
neither Fairbanks nor Wilshire shall have any liability for any
obligations, duties, or liabilities of the Trustee, the Depositor, the
Certificate Insurer any Owner or any Affiliate, successor or assignee
thereof or any prior owners or servicers of the related Mortgage Loans
with respect to the servicing of a Fairbanks Mortgage Loan or Wilshire
Mortgage Loan, as applicable, that arose prior to the date that the
relevant Servicer began servicing the related Mortgage Loans; PROVIDED,
HOWEVER, that at the written request of the Trustee, the Certificate
Insurer or the Depositor, or to the extent necessary to comply with
Accepted Servicing Practices, if the Sellers or a prior servicer shall
have failed to perform or cure such obligations, the relevant Servicer
shall be required to perform its obligations under this Agreement with
respect to such Mortgage Loan to the extent any acts or omissions
relating to the prior servicing of such Mortgage Loans would not
prevent or delay the relevant Servicer from performing such
obligations. Additionally, upon discovery by Fairbanks or Wilshire, as
applicable, of any material pre-transfer servicing defect not
previously disclosed to the Trustee, the Certificate Insurer or the
Depositor, the relevant Servicer shall notify each such Person, and
with the written consent of the Depositor, or to the extent necessary
to comply with Accepted Servicing Practices if the Sellers shall have
failed to cure such defects, the relevant Servicer shall take
reasonable measures consistent with Accepted Servicing Practices to
attempt to cure the defect or cause it to be cured; PROVIDED that,
subject to compliance with the foregoing and SECTION 8.05, all
reasonable expenses incurred by the relevant Servicer to cure such
defect shall be reimbursed as Servicing Advances.
Each of Fairbanks and Wilshire acknowledges that there may
exist documentary or collateral defects relating to the Fairbanks Mortgage Loans
and Wilshire Mortgage Loans. The Depositor or the Trustee may provide the
relevant Servicer with, or may cause the relevant Servicer to be provided with,
a list of such defects on or before the Closing Date and, whether or not such a
list is provided, the relevant Servicer shall notify the Trustee and the
Depositor of any such defects that are discovered by the relevant Servicer on or
after the Closing Date to the extent notice of such defects has not been
previously provided to such Persons; provided, that it is agreed and understood
that
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the Servicers shall have no obligation to review the Mortgage Loans or Mortgage
Loan Documents for purposes of detecting such defects. Each of Fairbanks,
GreenPoint and Wilshire shall take reasonable measures consistent with Accepted
Servicing Practices to attempt to cure such defects to the extent such defects
are not cured by the Sellers, or as otherwise reasonably requested by the
Trustee or the Depositor. Any reasonable costs incurred by the relevant Servicer
pursuant to this SECTION 8.03(C) shall be treated as Servicing Advances and, to
the extent not recoverable by the relevant Servicer from a third party, as Trust
Expenses reimbursable to such Servicer pursuant to SECTION 7.06(B)(VII).
(d) The provisions of this SECTION 8.03 shall survive the
termination of this Agreement and the payment of the outstanding
Certificates.
8.04 COLLECTION ACCOUNT.
(a) Each of Fairbanks and Wilshire shall establish and
maintain a Collection Account, which shall be an Eligible Account in
the name of the Servicer for the benefit of the Trustee for the benefit
of the Owners and the Certificate Insurer. Each Collection Account
shall be identified on the records of the depository institution as
follows: "[Servicer] in trust for JPMorgan Chase Bank, as Trustee under
the GSRPM Mortgage Loan Trust 2003-1 Trust and Servicing Agreement,
Series 2003-1, dated as of January 1, 2003." If any such Collection
Account ceases to be an Eligible Account hereunder, then the relevant
Servicer shall, within five (5) days, be required to name a successor
institution that will allow such Collection Account to meet the
requirements for an Eligible Account hereunder. Each of Fairbanks and
Wilshire shall notify the Trustee, the Depositor, the Certificate
Insurer and the Majority Class X Certificateholder if there is a change
in the name, account number or institution holding the Collection
Account maintained by such Servicer.
Subject to SECTION 8.04(D), each of Fairbanks and Wilshire
shall deposit all receipts (other than amounts permitted to be retained by the
Servicer as additional servicing compensation pursuant to this Agreement)
related to the Mortgage Loans serviced by such Servicer in the related
Collection Account on a daily basis (but no later than the second Business Day
after receipt). Wilshire shall deposit in its Collection Account all amounts
received by GreenPoint with respect to the Contracts as described in Section
3.18 hereof.
(b) All funds in the related Collection Account shall be held
(i) uninvested (up to the limits insured by the FDIC) or (ii) invested in
Eligible Investments and subject to a security account control agreement or
other provision having similar effect. Alternatively, the Collection Account may
be held as an Eligible Account that is a deposit account if the interest of the
Trustee in such account is perfected under sections 9-104, 9-304, and 9-314 of
the UCC. Any investments of funds in the Collection Account shall mature or be
withdrawable at par on or prior to the immediately succeeding Remittance Date
when such funds would be due pursuant to Section 8.04(c) below. Any
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investment earnings on funds held in the Collection Account shall be for the
account of the relevant Servicer and may only be withdrawn from the related
Collection Account by the relevant Servicer immediately following the remittance
to the Certificate Account of the Remittance Amount by such Servicer. Any
investment losses on funds held in any Collection Account shall be for the
account of the relevant Servicer and promptly upon the realization of such
losses shall be reimbursed by such Servicer to the related Collection Account.
Any references herein to amounts on deposit in the related Collection Account
shall refer to amounts net of such investment earnings and after reimbursement
by the relevant Servicer for such investment losses.
(c) Each of Fairbanks and Wilshire shall remit to the Trustee
the Remittance Amount related to the Mortgage Loans serviced by such Servicer
and Wilshire shall remit the amount remitted by GreenPoint with respect to the
Contracts together with any Monthly Advances and Compensating Interest payments
required to be paid by Wilshire pursuant to Sections 9.02 and 9.03 hereof with
respect to the Contracts for deposit into the Certificate Account, not later
than 2:00 p.m. New York time on the Remittance Date.
(d) (i) the relevant Servicer may make withdrawals for its own
account or for the accounts of the other Persons specified below from the
amounts on deposit in the related Collection Account, with respect to the
Mortgage Loans serviced by such Servicer, not in any order of priority and for
the following purposes:
(A) to reimburse the relevant Servicer
for Servicing Advances to the extent
of later payments of such amounts by
the Mortgagors and Liquidation
Proceeds from the Mortgage Loan to
which such Servicing Advance
related;
(B) to reimburse, the Trustee and then
itself in that order for Monthly
Advances from (i) late collections
on the Mortgage Loans serviced by
such Servicer and Wilshire or in the
case of the Contracts, Wilshire,
attributable to prior Due Dates and
(ii) collections of more than 30
days' interest on the related
Mortgage Loans during the most
recent Collection Period resulting
from the making of Monthly Payments
by the Mortgagor after the related
Due Dates, and to pay the Trustee
from such sources interest on
Monthly Advances made by it, at the
Advance Rate;
(C) to pay to the relevant Servicer the
Servicing Compensation associated
with the Mortgage Loans serviced by
such Servicer;
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(D) to withdraw amounts that have been
deposited to the related Collection
Account in error;
(E) to withdraw investment earnings on
amounts on deposit in the related
Collection Account;
(F) to reimburse to the Trustee or the
relevant Servicer any other amount
reimbursable to the Trustee or the
relevant Servicer from Liquidation
Proceeds in respect of Advances made
by the Trustee or the relevant
Servicer, as applicable;
(G) to pay to the Trust, monthly
interest payments on a Mortgage Loan
serviced by the relevant Servicer
that were already delinquent prior
to the Cut-off Date but received by
the relevant Servicer thereafter;
(H) to reimburse the relevant Servicer
for Nonrecoverable Advances with
respect to the Mortgage Loans
serviced by such Servicer and to
reimburse Wilshire for
Nonrecoverable Advances made with
respect to the Contracts;
(I) to deposit in the Simple Interest
Excess Sub-Account any amount
required to be deposited therein
pursuant to SECTION 8.07(D);
(J) with respect to the Collection
Account maintained by Wilshire only,
to reimburse or pay GreenPoint with
respect to any indemnification
obligation of the Trust with respect
to GreenPoint's activities under the
GreenPoint Servicing Agreement
pursuant to SECTION 5.05 thereof.
(K) to clear and terminate the related
Collection Account following the
termination of the Trust pursuant to
ARTICLE X.
(ii) On each Determination Date, each of Fairbanks and
Wilshire shall deliver to the Trustee, the Certificate Insurer and the
Depositor a monthly servicing report with respect to the Mortgage Loans
serviced by such Servicer on a loan-by-loan basis in a format
acceptable to the Trustee and the Certificate Insurer, containing the
following information: principal and interest collected, scheduled
interest, Liquidated Loans, summary and detailed delinquency reports,
Liquidation Proceeds and other similar information concerning the
servicing of such Mortgage Loans as may reasonably be requested by the
Trustee or the
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Depositor. In addition, each of Fairbanks and Wilshire shall inform the
Trustee and the Depositor on each Remittance Date with respect to the
Mortgage Loans serviced by such Servicer of the amounts of any Loan
Purchase Prices so remitted during the related Collection Period.
(iii) Each of Fairbanks and Wilshire shall provide to the
Trustee the information described in SECTION 8.04(D)(II) to enable the
Trustee to perform its reporting requirements under SECTION 7.08 and
the Trustee shall forward such information to the Underwriter on the
Distribution Date.
8.05 ADVANCES.
(a) Subject to SECTION 8.05(H), each of Fairbanks and Wilshire
will advance all reasonable and necessary "out-of-pocket" costs and
expenses incurred in the performance of its servicing obligations,
including, but not limited to, the cost of (i) Preservation Expenses,
(ii) any enforcement or judicial proceedings, including foreclosures,
(iii) the management and liquidation of REO Property, (iv) obtaining
broker price opinions, (v) locating missing Mortgage Loan Documents and
(vi) maintaining, transferring or establishing life of loan tax and
flood service contracts; PROVIDED, HOWEVER, that the relevant Servicer
is only required to pay such costs and expenses to the extent such
Servicer reasonably believes such costs and expenses will be
recoverable from the related Mortgage Loan. Each such expenditure will
constitute a "SERVICING ADVANCE." The relevant Servicer may recover
Servicing Advances from the relevant Mortgagors to the extent permitted
by the Mortgage Loans serviced by such Servicer or, if not recovered
from the relevant Mortgagor on whose behalf such Servicing Advance was
made, from Liquidation Proceeds realized upon the liquidation of the
related Mortgage Loan. The relevant Servicer shall be entitled to
recover the Servicing Advances from the aforesaid Liquidation Proceeds
prior to the payment of the Liquidation Proceeds to the related
Collection Account. The relevant Servicer shall treat any Servicing
Advance in excess of the Liquidation Proceeds as a Nonrecoverable
Advance and shall be reimbursed pursuant to SECTION 8.04(D)(I).
Notwithstanding anything herein to the contrary, no Servicing Advance
shall be required to be made if the relevant Servicer determines that
such Servicing Advance would, if made, constitute a Nonrecoverable
Advance.
(b) The Trustee shall not be required to make Servicing
Advances from its own funds. Any required Servicing Advances not made
by the relevant Servicer shall be paid as necessary by the Trustee out
of the Certificate Account.
(c) Not later than 2:00 p.m., New York time on each Remittance
Date, each of Fairbanks and Wilshire shall, but only with respect to
the Mortgage Loans serviced by such Servicer and subject to the
limitation contained in SECTION 8.05(H), remit to the Trustee for
deposit in the Certificate Account an amount (as indicated in the
statement prepared pursuant to SECTION 7.08), to be distributed on the
related Distribution Date pursuant to SECTION 7.06, equal to (i) with
respect to
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each Simple Interest Mortgage Loan, an amount equal to the Simple
Interest Shortfall which shall be paid from the Simple Interest Excess
Sub-Account maintained by the related Servicer, or if such funds are
insufficient, from the Servicer's own funds and (ii) with respect to
any other Mortgage Loan the amount of Monthly Payments (net of the
Servicing Fee) for all such Mortgage Loans serviced by such Servicer
that were due during the related Collection Period and delinquent as of
the related Determination Date (each such advance pursuant to clause
(i) or (ii), a "MONTHLY ADVANCE"); provided that no Servicer or the
Trustee shall be required to advance any shortfalls in the interest
portion of Monthly Payments as a result of the application of the Civil
Relief Act or any Compensating Interest Shortfalls.
(d) With respect to any of the Mortgage Loans, if a Monthly
Advance is required to be made hereunder, the related Servicer shall on
the Remittance Date either (i) deposit in the Collection Account from
its own funds an amount equal to such Monthly Advance, (ii) cause to be
made an appropriate entry in the records of the Collection Account that
funds in such account are being held for future distribution or
withdrawal used by such Servicer to make such Monthly Advance or (iii)
make such Monthly Advance in the form of any combination of clauses (i)
and (ii) aggregating the amount of such Monthly Advance. Any such funds
being held in a Collection Account for future distribution and so used
shall be replaced by such Servicer from its own funds by deposit in
such Collection Account before any future Remittance Date in which such
funds would be due.
(e) Notwithstanding anything herein to the contrary, Monthly
Advances by Fairbanks or Wilshire shall not include any amounts payable
as Compensating Interest or amounts which constitute Compensating
Interest Shortfall or Relief Act Shortfall, and no Monthly Advance by
any such Servicer shall be required to be made if such Servicer
determines that such Monthly Advance would, if made, constitute a
Nonrecoverable Advance, as evidenced by a Certificate of an Authorized
Officer of the relevant Servicer detailing the reasons for such
determination and delivered to the Trustee, the Depositor and the
Certificate Insurer on or before the Remittance Date in which such
Monthly Advance would have been made.
(f) If Fairbanks or Wilshire fails to make a required Monthly
Advance on any Remittance Date in accordance with SECTION 8.05(C), the
Trustee shall make such Monthly Advance by depositing the amount
thereof in the Certificate Account on the related Distribution Date
(and shall succeed to the relevant Servicer's rights with respect to
the reimbursement of such Monthly Advance); provided that the Trustee
shall be required to make a Monthly Advance only to the extent that the
Trustee has determined that such Monthly Advance, together with
interest thereon at the Advance Rate, would, if made, not constitute a
Nonrecoverable Advance. The Trustee may conclusively rely on a
determination by the relevant Servicer pursuant to SUBSECTION (D) above
that a Monthly Advance by such Servicer would, if made, constitute a
Nonrecoverable Advance.
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(g) Monthly Advances by Fairbanks or Wilshire are reimbursable
to such Servicer, as provided in SECTION 8.04(D) hereof. If the Trustee
is required to make Monthly Advances following the failure of the
relevant Servicer to do so, it will be entitled to receive interest on
such Monthly Advance at the Advance Rate, payable as provided in
SECTION 8.04(D) hereof.
(h) Notwithstanding anything herein to the contrary any
Servicing Advances or Monthly Advances by Fairbanks or Wilshire shall
not exceed 105% of the Actual Principal Balance of the Fairbanks
Mortgage Loans or Wilshire Mortgage Loans at the time of such Servicing
Advance or Monthly Advance, as the case may be.
8.06 COMPENSATING INTEREST.
Not later than 2:00 p.m., New York time on each Remittance
Date, with respect to each Fairbanks Mortgage Loan or Wilshire Mortgage Loan for
which a Principal Prepayment in full or a Curtailment that is more than two
times the amount of the Monthly Payment due for such Collection Period was
received during the related Collection Period, the relevant Servicer shall remit
to the Trustee for deposit in the Certificate Account from amounts otherwise
payable to it as servicing compensation, an amount (such amount required to be
delivered to the Trustee is referred to herein as "COMPENSATING INTEREST") (as
indicated in the statement prepared pursuant to SECTION 7.08) equal to the
difference between (a) 30 days' interest or, with respect to the first
Remittance Date, from the Closing Date, at the then applicable Mortgage Rate on
such Mortgage Loan and (b) the amount of interest actually received on such
Mortgage Loan for such Collection Period, but in no event shall the aggregate
amount of Compensating Interest paid on any Remittance Date (i) by Fairbanks
exceed the Servicing Fee due to Fairbanks for such Collection Period or (ii) by
Wilshire exceed one-half of the Servicing Fee due Wilshire for such Collection
Period; PROVIDED, HOWEVER, that neither Fairbanks nor Wilshire shall be
obligated to pay Compensating Interest Shortfalls or Relief Act Shortfalls for
the related Collection Period.
Neither Fairbanks nor Wilshire shall be entitled to
reimbursement for amounts paid as Compensating Interest with respect to the
Mortgage Loans serviced by such Servicer.
8.07 ESCROW ACCOUNT AND SIMPLE INTEREST EXCESS SUB-ACCOUNT.
(a) Each of Fairbanks and Wilshire shall establish and
maintain one or more escrow accounts (the "ESCROW ACCOUNT") in
accordance with applicable Law and Accepted Servicing Practices.
Subject to the foregoing:
(1) Each of Fairbanks and Wilshire shall
segregate and hold all funds collected and
received pursuant to each Mortgage Loan
serviced by the relevant Servicer which
constitute Escrow Payments separate and
apart from any of its own
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funds and general assets and shall establish
and maintain with a depository the Escrow
Account, in the form of time deposit or
demand accounts, with amounts on deposit in
or credited to the Escrow Account invested
in Eligible Investments.
(2) Each of Fairbanks and Wilshire shall deposit
(but no later than the second Business Day
after receipt) into the related Escrow
Account on a daily basis, and retain
therein, (i) all Escrow Payments collected
on account of the Mortgage Loans serviced by
such Servicer, for the purpose of effecting
timely payment of any such items as required
under the terms of this Agreement, and (ii)
all Insurance Proceeds which are to be
applied to the restoration or repair of any
Mortgaged Property related to a Fairbanks
Mortgage Loan or Wilshire Mortgage Loan, as
applicable. Each of Fairbanks and Wilshire
shall make withdrawals therefrom only to
effect such payments or to reimburse
Servicing Advances made by such Servicer.
Each of Fairbanks and Wilshire shall be
entitled to retain any interest paid on
funds deposited in the related Escrow
Account by the depository institution other
than interest on escrowed funds required by
Law to be paid to the Mortgagor. Each of
Fairbanks and Wilshire shall be responsible
for paying such interest on the funds
deposited in the related Escrow Account
without reimbursement therefore, shall be
responsible for ensuring that the
administrator of the related Escrow Account
complies with all applicable Law, and shall
indemnify and hold the Trustee, the
Depositor, the Certificate Insurer, the
Owners and their respective Affiliates,
successors and assigns harmless with respect
to any loss, liability or expense incurred
in connection with the administration of
such Accounts. As required by applicable
Law, each of Fairbanks and Wilshire shall
report interest earned on escrows and
mortgage interest paid.
(b) Withdrawals from the related Escrow Account may be made by
Fairbanks and Wilshire, as applicable, in accordance with applicable
Law and Accepted Servicing Practices. Subject to the foregoing,
withdrawals may be made only (i) to effect timely payments of ground
rents, taxes, assessments, water rates, hazard insurance premiums,
insurance premiums, if applicable, and comparable items constituting
Escrow Payments for the related Mortgage Loan, (ii) to reimburse the
relevant Servicer for any Servicing Advance made by such Servicer with
respect to a related Mortgage Loan but only from amounts received on
the related Mortgage Loan that represent late payments or collections
of Escrow Payments thereunder, (iii) to refund to the Mortgagor of a
Mortgage Loan
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serviced by such Servicer any funds as may be determined to be
overages, (iv) for application to restoration or repair of the
Mortgaged Property related to a Mortgage Loan serviced by such Servicer
in accordance with the terms of such Mortgage Loan, (v) to pay to the
relevant Servicer, or to the related Mortgagor to the extent required
by Law, any interest paid on the funds deposited in the related Escrow
Account, (vi) to reimburse itself for any amounts deposited in the
related Escrow Account in error, or (vii) to clear and terminate the
related Escrow Account on the termination of this Agreement.
(c) With respect to each Fairbanks Mortgage Loan and Wilshire
Mortgage Loan, the relevant Servicer shall use commercially reasonable
efforts to maintain accurate records in accordance with applicable Law,
Accepted Servicing Practices, the ▇▇▇▇▇▇ ▇▇▇ Guide and the ▇▇▇▇▇▇▇ Mac
Guide reflecting the status of ground rents, taxes, assessments, water
rates and other charges which are or may become a lien upon the
Mortgaged Property related to any such Mortgage Loan and the status of
the applicable fire and hazard insurance coverage (including charges
for the premiums thereon) and, with respect to the escrowed Mortgage
Loans, shall use commercially reasonable efforts to obtain, from time
to time, all bills for the payment of such charges, including renewal
premiums, and shall use commercially reasonable efforts to effect
payment thereof prior to the applicable penalty or termination date and
at a time appropriate for securing maximum discounts allowable,
employing for such purpose deposits of the related Mortgagor in the
related Escrow Account which shall have been estimated and accumulated
by Fairbanks or Wilshire, as the case may be, in amounts sufficient for
such purposes, as allowed under the terms of the related Mortgage and
applicable Law. To the extent that the Mortgage related to a Fairbanks
Mortgage Loan or Wilshire Mortgage Loan does not provide for Escrow
Payments, the relevant Servicer shall require that any such payments be
made by the related Mortgagor at the time they first become due. Each
of Fairbanks and Wilshire assumes full responsibility for the payment
of all such bills and shall effect payments of all such bills, premiums
and penalties irrespective of the relevant Mortgagor's faithful
performance in the payment of same or the making of the Escrow Payments
and shall make Servicing Advances from its own funds to effect such
payments unless such Servicing Advance, if made, would constitute a
Nonrecoverable Advance.
(d) Each Servicer shall establish and maintain a sub-account
of its Collection Account (the "Simple Interest Excess Sub-Account").
Each Servicer shall, on each Determination Date, transfer from the
Collection Account to the Simple Interest Excess Sub-Account all Net
Simple Interest Excess, if any, pursuant to Section 8.04(d)(i), and
shall maintain a record of all such deposits.
(e) Each Servicer shall withdraw amounts on deposit in the
Simple Interest Excess Sub-Account on each Remittance Date for deposit
to the Certificate Account in an amount equal to the lesser of (i) the
amount on deposit therein, and (ii) the Net Simple Interest Shortfall
for such Remittance Date.
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(f) Each Servicer shall remit to the Trustee for distribution
to the Class X Certificateholders, on a PRO RATA basis, 90% of the
balance in the applicable Simple Interest Excess Sub-Account on the
Remittance Date each year occurring in December, commencing in December
2003. Such distributions shall be deemed to be made on a first-in,
first-out basis. In addition, the related Servicer shall clear and
terminate the Simple Interest Excess Sub-Account upon the termination
of this Agreement and retain any funds remaining therein.
(g) Amounts on deposit in the Simple Interest Excess
Sub-Account may be invested in Eligible Investments. All income and
gain net of any losses realized from any such balances or investment of
funds on deposit in the Simple Interest Excess Sub-Account shall be for
the benefit of the related Servicer as servicing compensation and shall
be remitted to it monthly. The amount of any net investment losses in
the Simple Interest Excess Sub-Account shall promptly be deposited by
the related Servicer in the Simple Interest Excess Sub-Account.
8.08 MAINTENANCE OF INSURANCE.
(a) Each of Fairbanks and Wilshire shall cause to be
maintained with respect to each Mortgage Loan serviced by such Servicer that is
or becomes a first lien on the related Mortgaged Property, a hazard insurance
policy with a generally acceptable carrier that provides for fire and extended
coverage, and which provides for a recovery by the Trust of insurance proceeds
relating to such Mortgage Loan in an amount not less than the least of (i) the
Actual Principal Balance of such Mortgage Loan, (ii) the minimum amount required
to compensate for damage or loss on a replacement cost basis and (iii) the full
insurable value of the premises. Each of Fairbanks and Wilshire shall maintain
the insurance policies required hereunder in the name of the mortgagee, its
successors and assigns, as loss payee. The policies shall require the insurer to
provide the mortgagee with thirty (30) days' notice prior to any cancellation or
as otherwise required by Law. The relevant Servicer may also maintain a blanket
hazard insurance policy or policies if the insurer or insurers of such policies
are rated investment grade by each Rating Agency. Upon the request of the
Depositor, the Certificate Insurer or the Trustee, the relevant Servicer will
cause to be delivered to such requesting Person a certified true copy of such
blanket policy.
(b) If a First Mortgage Loan at the time of origination
relates to a Mortgaged Property for a Mortgage Loan in an area identified in the
Federal Register by the Federal Emergency Management Agency as having special
flood hazards, the relevant Servicer will cause to be maintained with respect
thereto a flood insurance policy in a form meeting the requirements of the
current guidelines of the Federal Insurance Administration with a generally
acceptable carrier in an amount representing coverage, and which provides for a
recovery by the Trust of insurance proceeds relating to such Mortgage Loan of
not less than the least of (i) the Actual Principal Balance of the Mortgage
Loan, (ii) the minimum amount required to compensate for damage or loss on a
replacement cost basis and (iii) the maximum amount of insurance that is
available under the Flood Disaster Protection Act of 1973. The relevant Servicer
shall indemnify the
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Trust and its Affiliates, successors and assigns out of its own funds for any
loss, liability or expenses resulting from the relevant Servicer's failure to
maintain premiums for such insurance required by this SECTION when so permitted
by the terms of the Mortgage related to a Fairbanks Mortgage Loan or Wilshire
Mortgage Loan as to which such loss relates.
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8.09 DUE-ON-SALE CLAUSES; ASSUMPTION AND SUBSTITUTION
AGREEMENTS.
When a Mortgaged Property related to a Fairbanks Mortgage Loan
or Wilshire Mortgage Loan has been or is about to be conveyed by the applicable
Mortgagor, the relevant Servicer shall, to the extent it has knowledge of such
conveyance or prospective conveyance, exercise its rights to accelerate the
maturity of the related Mortgage Loan under any "due-on-sale" clause contained
in the related Mortgage or Mortgage Note; PROVIDED, HOWEVER, that the relevant
Servicer shall not exercise any such right if the "due-on-sale" clause, in the
reasonable belief of such Servicer, is not enforceable under applicable Law. An
opinion of counsel to the foregoing effect shall conclusively establish the
reasonableness of such belief. In such event, the relevant Servicer shall,
subject to customary credit approvals, enter into an assumption and modification
agreement with the Person to whom such Mortgaged Property related to a Fairbanks
Mortgage Loan or Wilshire Mortgage Loan has been or is about to be conveyed,
pursuant to which such Person becomes liable under the related Mortgage Note
and, unless prohibited by applicable Law or the relevant Mortgage Documents, the
Mortgagor of such Mortgage Loan remains liable thereon. If the foregoing is not
permitted under applicable Law, the relevant Servicer is authorized to enter
into a substitution of liability agreement with such Person upon undergoing the
customary credit approval of such Person, pursuant to which the original
Mortgagor of such Mortgage Loan is released from liability and such Person is
substituted as Mortgagor and becomes liable under the Mortgage Note for such
Mortgage Loan; PROVIDED, HOWEVER, that to the extent any such substitution of
liability agreement would be delivered by the relevant Servicer outside of
Accepted Servicing Practices the relevant Servicer shall, prior to executing and
delivering such agreement, obtain the prior written consent of the Majority
Class X Certificateholder. The Fairbanks Mortgage Loan or Wilshire Mortgage
Loan, as assumed, shall conform in all respects to the requirements,
representations and warranties of this Agreement, and no term thereof other than
the identity of the related Mortgagor shall be changed. The relevant Servicer
shall notify the Trustee and the Majority Class X Certificateholder that any
such assumption or substitution agreement has been completed by forwarding to
the Trustee and the Majority Class X Certificateholder the original copy of such
assumption or substitution agreement (indicating the Custodial File to which it
relates) which copy shall be added by the Trustee to the related Custodial File
and which shall, for all purposes, be considered a part of such Custodial File
to the same extent as all other documents and instruments constituting a part
thereof. The relevant Servicer shall be responsible for recording any such
assumption or substitution agreements. Any fee collected by the relevant
Servicer for consenting to any such conveyance or entering into an assumption or
substitution agreement shall be retained by such Servicer as additional
Servicing Compensation.
Notwithstanding the foregoing paragraph or any other provision
of this Agreement, neither Fairbanks nor Wilshire shall be deemed to be in
default, breach or any other violation of its obligations hereunder by reason of
any assumption of a Mortgage Loan by operation of law or any assumption which
such Servicer may be restricted by Law from preventing, for any reason
whatsoever.
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8.10 DEFAULTED MORTGAGE LOANS; MODIFICATION.
(a) Neither Fairbanks nor Wilshire may sell or purchase, or
permit the sale or purchase of, a defaulted Mortgage Loan, except as
expressly provided in or contemplated by SECTION 8.10(D) or SECTION
8.21.
(b) If any Fairbanks Mortgage Loan or Wilshire Mortgage Loan
becomes a Defaulted Mortgage Loan, the relevant Servicer shall promptly
so notify in writing the Trustee. The relevant Servicer may continue
making collection efforts on such Mortgage Loan, and shall be entitled
to receive Servicing Compensation and be reimbursed for Servicing
Advances made by it for the period while such Mortgage Loan was in
default from Liquidation Proceeds or from future collections thereof if
such Mortgage Loan subsequently becomes current;
(c) [Reserved]
(d) In the event that the Majority Class X Certificateholders
exercises its purchase option pursuant to SECTION 8.21 with respect to
a Defaulted Mortgage Loan, the relevant Servicer shall cause the
Trustee to sell such Defaulted Mortgage Loan to the Majority Class X
Certificateholder at the Loan Purchase Price. If the Majority Class X
Certificateholder does not exercise its purchase option, the relevant
Servicer shall proceed to foreclose upon or work-out such Defaulted
Mortgage Loan, pursuant to Accepted Servicing Practices and in
accordance with this SECTION 8.10.
In the event Fairbanks or Wilshire forecloses and converts the
Mortgaged Property related to a Fairbanks Mortgage Loan or Wilshire Mortgage
Loan, title shall be taken in the name of the Trustee and such Servicer shall
sell any REO Property related to such Mortgage Loan on behalf of the Trustee
before the start of the twelfth month of the third taxable year following the
taxable year in which the Trust acquired such property, at such price as such
Servicer deems necessary to comply with this covenant unless such Servicer
obtains a REMIC Opinion addressed to the Trustee, the Certificate Insurer, such
Servicer and Depositor stating that the holding of such REO Property will not
cause such REO Property to fail to qualify as "foreclosure property" within the
meaning of Section 860G(a)(8) of the Code or result in the receipt by any REMIC
of any "income from non-permitted assets" within the meaning of Section
860F(a)(2)(B) of the Code or any "net income from foreclosure property" which is
subject to taxation under the REMIC Provisions. Notwithstanding the generality
of the foregoing provisions, the relevant Servicer shall manage, conserve,
protect and operate each REO Property related to a Fairbanks Mortgage Loan or
Wilshire Mortgage Loan, as the case may be, on behalf of the Trustee for the
benefit of Owners and the Certificate Insurer solely for the purpose of its
prompt disposition and sale in a manner which does not cause such REO Property
to fail to qualify as "foreclosure property" within the meaning of Section
860G(a)(8) of the Code or result in the receipt by any REMIC of any "income from
non-permitted assets" within the meaning of Section 860F(a)(2)(B) of the Code or
any "net income from foreclosure property" which is subject to taxation under
the REMIC Provisions.
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Pursuant to its efforts to sell REO Property related to a
Fairbanks Mortgage Loan or Wilshire Mortgage Loan, the relevant Servicer shall
either itself or through an agent selected by such Servicer protect and conserve
such REO Property in the same manner and to such extent as is customary in the
locality where such REO Property is located and may, incident to its
conservation and protection of the interests of the Trustee for the benefit of
the Owners and the Certificate Insurer, rent the same, or any part thereof, as
such Servicer deems to be in the best interest of the Owners and the Certificate
Insurer for the period prior to the sale of such REO Property. In determining
whether to foreclose upon or otherwise comparably convert the ownership of such
Mortgaged Property, the relevant Servicer shall review the Custodial Files
relating to such Mortgage Loans to determine the existence of any hazardous
substances, hazardous wastes or solid wastes, as such terms are defined in the
Comprehensive Environmental Response Compensation and Liability Act, the
Resource Conservation and Recovery Act of 1976, or other federal, state or local
environmental legislation. Each of Fairbanks and Wilshire shall take into
account the existence of any hazardous substances, hazardous wastes or solid
wastes, as such terms are defined in the Comprehensive Environmental Response
Compensation and Liability Act, the Resource Conservation and Recovery Act of
1976, or other federal, state or local environmental legislation in proceeding
with any action. Furthermore, the relevant Servicer shall not take any such
action with respect to any Mortgaged Property related to a Fairbanks Mortgage
Loan or a Wilshire Mortgage Loan, as the case may be, known by such Servicer to
contain such wastes or substances, without the prior written consent of the
Majority Class X Certificateholder and the Trustee. With respect to any Mortgage
Loan secured by a mixed use Mortgaged Property, the relevant Servicer shall,
prior to foreclosing upon or otherwise comparably effecting ownership its name
on behalf of the Trust, perform a "phase one environmental study" of such
Mortgaged Property.
(e) Notwithstanding anything to the contrary in this SECTION
8.10, the relevant Servicer shall not foreclose on a Mortgage Loan that
is a second lien on the related Mortgaged Property and take title to
the related Mortgaged Property of a Mortgage Loan subject to the senior
lien on such Mortgaged Property.
(f) Neither Fairbanks nor Wilshire shall agree to any
modification, waiver or amendment of any provision of any Mortgage Loan, unless
the relevant Servicer has (i) undergone an evaluation of the relevant
Mortgagor's creditworthiness at the time of the modification and (ii) in such
Servicer's good faith judgment, such modification, waiver or amendment would
minimize the loss that might otherwise be experienced with respect to such
Mortgage Loan and only in the event a payment default with respect to such
Mortgage Loan has occurred or in the opinion of the relevant Servicer is
reasonably foreseeable; PROVIDED, HOWEVER, that no such modification, waiver or
amendment shall extend the maturity date of such Mortgage Loan beyond the
Collection Period related to the final scheduled Distribution Date of the latest
Class of Certificates remaining in the Trust. Notwithstanding anything set forth
in this SECTION 8.10(F) or elsewhere in this Agreement to the contrary, the
related Servicer shall be permitted to modify, waive or amend any provision of a
Mortgage Loan serviced by such Servicer if required by
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applicable Law to do so. The related Servicer shall promptly notify the Trustee
and the Certificate Insurer of any such modification, waiver or amendment.
(g) Each of Fairbanks and Wilshire shall deliver to the
Trustee for deposit in the related Custodial File, an original
counterpart of any agreement relating to such modification, waiver or
amendment, promptly following the execution thereof.
8.11 TRUSTEE TO COOPERATE; RELEASE OF FILES.
(a) Upon the payment in full of any Fairbanks Mortgage Loan or
Wilshire Mortgage Loan (including any liquidation of such Mortgage Loan
through foreclosure or otherwise), or the receipt by the relevant
Servicer of a notification that payment in full will be escrowed in a
manner customary for such purposes, such Servicer shall deliver to the
Trustee a request for release in the form attached hereto as EXHIBIT
J-1 or utilize a paperless release using the paperless release template
attached hereto as EXHIBIT J-2. Upon receipt of such Request for
Release of Documents, the Trustee shall promptly release or cause the
release of the related Custodial File, in trust, to (i) the relevant
Servicer, (ii) an escrow agent or (iii) any employee, agent or attorney
of the Trustee. Upon any such payment in full, or the receipt of such
notification that such funds have been placed in escrow, the relevant
Servicer is authorized to give, as attorney-in-fact for the Trustee and
the mortgagee under the Mortgage relating to a Fairbanks Mortgage Loan
or Wilshire Mortgage Loan which secured the relevant Mortgage Note, an
instrument of satisfaction (or assignment of such Mortgage without
recourse, representation or warranty) regarding the Mortgaged Property
relating to such Mortgage, which instrument of satisfaction or
assignment, as the case may be, shall be delivered to the Person or
Persons entitled thereto against receipt therefor of payment in full,
it being understood and agreed that no expense incurred in connection
with such instrument of satisfaction or assignment, as the case may be,
shall be chargeable to the related Collection Account. In lieu of
executing any such satisfaction or assignment, as the case may be, the
relevant Servicer may prepare and submit to the Trustee a satisfaction
(or assignment without recourse, representation or warranty, if
requested by the Person or Persons entitled thereto) in form for
execution by the Trustee with all requisite information completed by
the relevant Servicer; in such event, the Trustee shall execute and
deliver a power of attorney prepared and delivered by such Servicer to
the Trustee and acceptable to the Trustee authorizing such Servicer to
prepare such satisfaction and deliver the same with the related
Custodial File, as aforesaid.
(b) From time to time and as appropriate in the servicing of
any Fairbanks Mortgage Loan or Wilshire Mortgage Loan, including,
without limitation, foreclosure or other comparable conversion of a
Fairbanks Mortgage Loan or Wilshire Mortgage Loan or collection under
any applicable Insurance Policy, the Trustee shall (except in the case
of the payment or liquidation pursuant to which
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the related Custodial File is released to an escrow agent or an
employee, agent or attorney of the Trustee), upon request of the
relevant Servicer and delivery to the Trustee of a receipt signed by an
Authorized Officer of such Servicer, release the related Custodial File
to such Servicer and shall execute a power of attorney prepared and
delivered by such Servicer to the Trustee and acceptable to the Trustee
authorizing such Servicer to execute such documents as shall be
necessary to the prosecution of any such proceedings, including,
without limitation, an assignment without recourse, representation or
warranty of the related Mortgage to the relevant Servicer; PROVIDED
that there shall not be released and unreturned at any one time more
than 10% of the entire number of Custodial Files to any one Servicer.
Such receipt shall obligate the relevant Servicer to return the
Custodial File to the Trustee when the need therefor by the relevant
Servicer no longer exists unless the Mortgage Loan shall be liquidated,
in which case, upon receipt of the ▇▇▇▇▇▇ ▇▇▇ "Liquidation Schedule"
relating to such liquidation, the receipt shall be released by the
Trustee to the relevant Servicer. The Trustee shall have no liability
for the relevant Servicer's failure to return a Custodial File released
to such Servicer pursuant to this SECTION 8.11, other than to determine
that the relevant Servicer has not returned the file and take
appropriate action.
(c) Each of Fairbanks and Wilshire shall have the right to
accept applications of Mortgagors for consent to (i) partial releases
of Mortgaged Properties relating to Mortgage Loans serviced by such
Servicer, (ii) alterations and (iii) removal, demolition or division of
Mortgaged Properties relating to such Mortgage Loans subject to
Mortgages. No application for approval shall be considered by the
relevant Servicer unless: (w) the Trustee and the Certificate Insurer
has been provided with a REMIC Opinion addressed to the Trustee to the
effect that such action is in compliance with REMIC Provisions, is not
a "prohibited transaction" within the meaning of Code Section
860F(a)(2) and will not prevent either Trust REMIC from qualifying as a
REMIC; (x) the provisions of the related Mortgage Note and Mortgage
relating to the applicable Mortgage Loan have been complied with; (y)
the loan-to-value ratio after any such action does not exceed the
original Loan-to-Value Ratio of such Mortgage Loan and any increase in
the loan-to-value ratio of such Mortgage Loan shall not exceed 15%
unless approved in writing by the Majority Class X Certificateholder;
and (z) the lien priority of the related Mortgage is not affected. Upon
receipt by the Trustee of an Officer's Certificate executed on behalf
of the relevant Servicer setting forth the action proposed to be taken
in respect of a particular Mortgage Loan and certifying that the
criteria set forth in the immediately preceding sentence have been
satisfied, the Trustee shall execute and deliver to the relevant
Servicer the consent or partial release so requested by such Servicer.
A proposed form of consent or partial release, as the case may be,
shall accompany any Officer's Certificate delivered by the relevant
Servicer pursuant to this paragraph. The relevant Servicer shall notify
the Depositor, the Trustee and the Rating Agencies if an application is
approved under clause (y) above, without approval in writing by the
Depositor and the Trustee.
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8.12 SERVICING COMPENSATION.
(a) Each of Fairbanks and Wilshire shall be entitled to
receive the Servicing Fee during each Collection Period as compensation
for the servicing of the Fairbanks Mortgage Loans and the Wilshire
Mortgage Loans, respectively. Without limiting the generality of the
foregoing, except as provided herein, neither Fairbanks nor Wilshire
shall be entitled to receive the Servicing Fee on any Mortgage Loan for
which a Monthly Payment has not been received during the respective
Collection Period, PROVIDED, however, that Servicing Fees shall accrue
on such Mortgage Loans during this period. Such accrued and unpaid
Servicing Fees shall be paid to the relevant Servicer (i) if a Monthly
Payment is made for such Delinquent Mortgage Loan, at such time; (ii)
from Liquidation Proceeds, if the Delinquent Mortgage Loan is
liquidated; or (iii) from the Collection Account if such Delinquent
Mortgage Loan is charged-off. Amounts paid to Fairbanks or Wilshire
pursuant to the immediately preceding sentence with respect to any
Fairbanks Mortgage Loan or Wilshire Mortgage Loan, as applicable, shall
be deemed to be from the payment of the interest portion of Monthly
Payments for such Mortgage Loan.
(b) Fairbanks and Wilshire will receive all other ancillary
income including but not limited to all fees received with respect to
late fees, checks or bank drafts returned by the related bank for
non-sufficient funds, assumption fees, optional insurance
administration fees and all other incidental fees and charges with
respect to each Mortgage Loan for any period in which such Mortgage
Loan was serviced by Fairbanks or Wilshire.
(c) Each of Fairbanks and Wilshire shall pay itself the
Servicing Compensation by withdrawing such Servicing Compensation from
the related Collection Account in accordance with SECTION 8.04(D).
8.13 ANNUAL STATEMENT AS TO COMPLIANCE.
Each of Fairbanks and Wilshire, at its own expense, will
deliver to the Trustee, the Depositor, the Certificate Insurer and the Rating
Agencies, on or before March 15 of each year, commencing in 2004, an Officer's
Certificate stating, as to each signer thereof, that (i) a review of the
activities of the relevant Servicer during such preceding calendar year and of
performance under this Agreement has been made under such officers' supervision,
and (ii) to the best of such officers' knowledge, based on such review, the
relevant Servicer has fulfilled all its obligations under this Agreement for
such year, or, if there has been a default in the fulfillment of all such
obligations, specifying each such default known to such officers and the nature
and status thereof including the steps being taken by the relevant Servicer to
remedy such default.
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8.14 ANNUAL INDEPENDENT CERTIFIED PUBLIC ACCOUNTANTS' REPORTS.
On or before March 15 of each year, commencing in 2004, each
of Fairbanks and Wilshire, at its own expense (or if the Trustee is then acting
as servicer of the related Mortgage Loans, at the expense of the Depositor,
which in no event shall exceed $1,000 PER ANNUM), shall cause to be delivered to
the Trustee, the Depositor, the Certificate Insurer and the Rating Agencies a
letter or letters of a firm of independent, nationally recognized certified
public accountants reasonably acceptable to the Depositor, the Certificate
Insurer and the Trustee, dated as of the date of the fiscal audit of the
relevant Servicer for the related period, stating that such firm has examined
such Servicer's overall servicing operations in accordance with the requirements
of the Uniform Single Attestation Program for Mortgage Bankers, and stating such
firm's conclusions relating thereto.
8.15 ACCESS TO CERTAIN DOCUMENTATION AND INFORMATION REGARDING
THE MORTGAGE LOANS; STAFFING.
Each of Fairbanks and Wilshire shall provide to the Trustee,
the Depositor, the Majority Class X Certificateholder, the Certificate Insurer,
the FDIC and any supervisory agents and examiners of any of the foregoing
(which, in the case of supervisory agents and examiners, may be required by
applicable state and federal regulations) access to the documentation regarding
the Mortgage Loans serviced by such Servicer, such access being afforded without
charge but only upon reasonable request and during normal business hours at the
offices of such Servicer designated by it.
Each of Fairbanks and Wilshire agrees to secure by the Closing
Date adequate staffing to manage and service the Fairbanks Mortgage Loans and
Wilshire Mortgage Loans, respectively, according to the standards set forth in
this Agreement, which staffing shall be in accordance with such Servicer's
current human resources standards for servicing mortgage loans comparable to the
Fairbanks Mortgage Loans and the Wilshire Mortgage Loans.
8.16 ASSIGNMENT OF AGREEMENT.
Neither Fairbanks nor Wilshire may assign its rights or
obligations with respect to the making or reimbursement of Advances made by the
relevant Servicer pursuant to the terms of this Agreement, in whole or in part,
unless such assignee is a corporation or association 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 at least $50,000,000 subject to supervision or
examination by the United States of America and having a deposit rating of at
least "A2" by Moody's (or such lower rating as may be acceptable to Moody's),
and deposit rating of "A" by Standard & Poor's (or such lower rating as may be
acceptable to Standard & Poor's). If such assignee publishes reports of
condition at least annually, pursuant to law or to the requirements of the
aforesaid supervising or examining authority, then for the purposes of this
SECTION, the combined capital and surplus of such
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corporation or association shall be deemed to be its combined capital and
surplus as set forth in its most recent report of condition so published.
Notwithstanding the foregoing, JPMorgan Chase Bank shall be automatically
approved as an assignee of any such Servicer with respect to any Advances
hereunder without the satisfaction of the eligibility requirements set forth in
this Section 8.16.
Except for an assignment relating to the making or
reimbursement of Advances permitted by this Section 8.16, neither Fairbanks nor
Wilshire may assign any other rights or obligations under this Agreement without
the prior written consent of the Certificate Insurer.
8.17 REMOVAL OF SERVICER; RESIGNATION OF SERVICER.
(a) The Depositor (or the Trustee with consent of the
Depositor) with the consent of the Certificate Insurer (unless a
Certificate Insurer Default has occurred and is continuing), which
consent shall not be unreasonably withheld may terminate Fairbanks or
Wilshire as a Servicer hereunder with respect to the Fairbanks Mortgage
Loans or the Wilshire Mortgage Loans, as applicable, without cause,
effective upon the giving of written notice on the date set forth in
such notice (unless such Servicer shall have received a notice of
extension, executed by a duly authorized Person on behalf of the
Depositor or the Trustee, as applicable, which notice the Depositor or
Trustee may withhold in its sole discretion), that this Agreement shall
have been terminated in whole, or that this Agreement shall have been
terminated in part with respect to the servicing of the Mortgage Loans
specified in such notice, without any further notice or demand, but,
except as otherwise agreed by the relevant Servicer with the Depositor
in the case of a termination by the relevant Servicer, subject to the
payment of the termination fee set forth in SECTION 8.18(D) by the
Depositor (such event, a "SERVICER TERMINATION EVENT"). Any such notice
of termination shall be in writing and delivered to the relevant
Servicer as provided in SECTION 12.19.
(b) Notwithstanding any other provision hereof to the
contrary, (i) the Depositor may, with the reasonable consent of the
Certificate Insurer (unless a Certificate Insurer Default has occurred
and is continuing) and (ii) the Trustee may, with the reasonable
consent of the Certificate Insurer and shall at the direction of the
Certificate Insurer (in each case unless a Certificate Insurer Default
has occurred and is continuing), terminate any rights Fairbanks or
Wilshire may have hereunder with respect to the Fairbanks Mortgage
Loans or the Wilshire Mortgage Loans, as applicable, with cause, upon
five (5) Business Days' prior written notice, except with respect to
clauses (1) and (2) hereunder, which shall occur immediately upon the
happening of such event. Notwithstanding the foregoing, if an event
described in paragraph (2)(b) below shall occur, the Trustee may
terminate the relevant Servicer without the consent of the Certificate
Insurer. For all purposes of determining "cause" with respect to
termination of this Agreement or the rights of the relevant Servicer
hereunder, such term shall mean
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termination upon the occurrence of any of the following events which is
not cured within any applicable cure period specified below:
(1) Any failure by the relevant Servicer to
remit to the Trustee any payment other than
Servicing Advances or Monthly Advances
required to be made by such Servicer under
the terms of this Agreement which continues
unremedied for a period up to five Business
Days;
(2) The failure by the relevant Servicer to make
(a) any required Servicing Advance which
failure continues unremedied for a period of
thirty (30) days after the date on which
written notice of such failure, requiring
the same to be remedied, shall have been
given to such Servicer by the Trustee or (b)
any required Monthly Advance by the day that
such Monthly Advance is required to be paid
as provided herein, PROVIDED, HOWEVER,
isolated and infrequent failures by the
relevant Servicer to pay any de minimus
portion of a Monthly Advance when required
shall not be a termination event for cause
of Fairbanks or Wilshire;
(3) Any failure on the part of the relevant
Servicer to duly observe or perform in a
material respect any other of the covenants
or agreements on the part of such Servicer
contained in this Agreement or the breach by
the relevant Servicer of any representation
and warranty contained in this Agreement,
which continues unremedied for a period of
thirty (30) days after the date on which
written notice of such failure, requiring
the same to be remedied, shall have been
given to such Servicer by the Trustee, the
Certificate Insurer or the Depositor;
PROVIDED, HOWEVER, that if such Servicer can
demonstrate to the reasonable satisfaction
of the Depositor and the Certificate Insurer
that it is diligently pursuing remedial
action, then the cure period may be extended
with the written approval of the Depositor
and the Certificate Insurer (which approval
shall not be subject to unreasonable
conditions or unreasonably withheld);
(4) A decree or order of a court or agency or
supervisory authority having jurisdiction in
an involuntary case under any present or
future federal or state bankruptcy,
insolvency or similar Law or the appointment
of a conservator or receiver or liquidator
in any insolvency, readjustment of debt,
marshaling of assets and liabilities or
similar proceeding, or for the winding-up or
liquidation of its affairs, shall have been
entered against the relevant
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Servicer and such decree or order shall have
remained in force undischarged or unstayed
for a period of sixty (60) days;
(5) The relevant Servicer shall consent to the
appointment of a conservator or receiver or
liquidator in any insolvency, readjustment
of debt, marshaling of assets and
liabilities or similar proceeding of or
relating to it or of or relating to all or
substantially all of its property;
(6) The relevant Servicer shall admit in writing
to its inability to pay its debts generally
as they become due, file a petition to take
advantage of any applicable insolvency or
reorganization statute, make an assignment
for the benefit of its creditors, or
voluntarily suspend payment of its
obligations;
(7) (a) For so long as Fairbanks or Wilshire
shall remain a Servicer hereunder, failure
by Fairbanks Capital Holding Corp. to
maintain at all times a minimum consolidated
net worth of at least $30,000,000 or failure
by Wilshire to maintain at all times a
minimum net worth of at least $15,000,000,
or (b) failure by Fairbanks or Wilshire to
meet at all times any equity, net worth,
capitalization and other eligibility
requirements for servicers required under
applicable Law, or as otherwise required by
▇▇▇▇▇▇ ▇▇▇ or ▇▇▇▇▇▇▇ Mac; or
(8) Entry of any cease and desist order or
similar order or directive issued against
the relevant Servicer or any of its
Affiliates by any regulator of such Servicer
which order remains in effect longer than
180 days;
The relevant Servicer shall provide prompt notice to the
Trustee, the Certificate Insurer and the Depositor upon learning of any of the
foregoing events.
(c) The Depositor may terminate the rights and obligations of
Fairbanks or Wilshire hereunder if either Fairbanks or Wilshire, as the
case may be, shall fail to meet the Servicing Standards as set forth on
Exhibit C or Exhibit D and the Depositor has determined that such event
is likely to materially and adversely affect the Mortgage Loans. The
Depositor shall give written notice of termination to the relevant
Servicer and such Servicer's obligations hereunder shall terminate
immediately upon receipt of such notice. The Depositor shall give
notice of such termination to the Trustee and the Certificate Insurer.
(d) Neither Fairbanks nor Wilshire shall resign from the
obligations and duties hereby imposed on it, except upon determination
that its duties hereunder
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are no longer permissible under applicable Law or are in material
conflict by reason of applicable Law with any other activities carried
on by it, the other activities of such Servicer so causing such a
conflict being of a type and nature carried on by such Servicer at the
date of this Agreement. Any such determination permitting the
resignation of either Fairbanks or Wilshire shall be evidenced by an
opinion of counsel to such effect which shall be delivered to the
Depositor, the Certificate Insurer and the Trustee, which opinion shall
be at the expense of the relevant Servicer.
(e) No removal or resignation of Fairbanks or Wilshire shall
become effective until (1) the Trustee or other successor Servicer
shall have assumed the responsibilities and obligations of the relevant
Servicer in accordance with this SECTION and (2) upon the termination
of the relevant Servicer pursuant to SECTION 8.17(A) OR (C), such
Servicer shall have been reimbursed by the Trust for all unreimbursed
Advances and all unpaid Servicing Compensation and shall have been paid
the termination fee set forth in SECTION 8.18(D).
(f) Upon the occurrence of a Fairbanks Termination Trigger
Event or a Wilshire Termination Trigger Event, the Certificate Insurer
or the Majority Class X Certificateholder, with the consent of the
Certificate Insurer (unless a Certificate Insurer Default has occurred
and is continuing) may terminate the related Servicer upon ten (10)
Business Days' prior written notice.
(g) In addition, the Depositor may terminate any rights
Fairbanks or Wilshire may have hereunder with respect to the Fairbanks
Mortgage Loans and Wilshire Mortgage Loans as separately agreed in
writing by the Depositor and such Servicer.
(h) Upon removal or resignation of Fairbanks or Wilshire, such
Servicer at its own expense (except in the event of a removal other
than for cause, in which case it shall be an expense of the removing
party) also shall promptly deliver or cause to be delivered to the
Trustee or other successor Servicer, as directed in writing by the
Trustee, all Records and Mortgage Loan Documents related to the
Mortgage Loans previously serviced by such Servicer.
(i) Any Collections then being held by Fairbanks or Wilshire
prior to its removal and any Collections received by any such Servicer
after removal or resignation shall be endorsed by it to the Trustee and
remitted directly and immediately to the Trustee or the successor
Servicer.
(j) If Fairbanks or Wilshire is being removed or is resigning
pursuant to clause (d) above, such Servicer (or, in the absence of such
notice, the Trustee) shall give notice to the Mortgagors, the
Depositor, the Certificate Insurer and the Rating Agencies of the
transfer of the servicing to the successor Servicer. In addition, the
Trustee (or the Depositor, in the case of a proposed removal pursuant
to SECTION 8.17(C) OR (F)), shall give prompt notice to the Rating
Agencies, the
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Depositor and the Certificate Insurer of any formal action taken in
furtherance of the removal of Fairbanks or Wilshire.
(k) If Fairbanks or Wilshire is removed by the Depositor or
the Trustee or resigns pursuant to clause (d) above, such Servicer
shall be entitled to reimbursement of all unreimbursed Advances and
unpaid Servicing Compensation in accordance with SECTION 8.18(D).
(l) The Trustee shall give notice to the Owners, the Depositor
and the Rating Agencies of the occurrence of any event described in
SECTION 8.17(A) or (B) of which an Authorized Officer of the Trustee is
aware.
8.18 SUCCESSOR SERVICERS.
(a) APPOINTMENT OF SUCCESSOR. On and after a termination of
Fairbanks or Wilshire, as a Servicer hereunder or a resignation of
Fairbanks or Wilshire as evidenced by an opinion of counsel as
described in SECTION 8.17(D), then the Trustee, within sixty (60) days
of the occurrence of such event, shall, with the reasonable consent of
the Certificate Insurer, have a successor Servicer in place to be the
successor in all respects to Fairbanks or Wilshire, as the case may be,
in its capacity as Servicer under this Agreement and the transactions
set forth or provided for herein and such successor Servicer shall be
subject to all the responsibilities, duties and liabilities relating
thereto placed on Fairbanks or Wilshire, as the case may be, by the
terms and provisions hereof; PROVIDED, HOWEVER, that the successor
Servicer shall not be liable for any actions of any Servicer prior to
its appointment as successor Servicer. The Trustee (x) may solicit bids
for a successor Servicer as described in SECTION 8.18(B), and (y)
pending the appointment of a successor Servicer, shall serve as
Servicer in the event of the removal or resignation of any of the
Servicers. Notwithstanding the foregoing, the parties hereto agree that
the Trustee, in its capacity as successor Servicer, immediately will
assume all of the obligations of any Servicer to make Monthly Advances,
Servicing Advances and to pay Compensating Interest with respect to the
relevant Mortgage Loans and the Trustee will assume the other duties of
such Servicer as soon as practicable, but in no event later than sixty
(60) days after the Servicer Termination Date. If the Trustee assumes
the responsibilities of a Servicer pursuant to this SECTION 8.18, then
the Trustee will make reasonable efforts consistent with applicable Law
to obtain qualification in order to perform its obligations as Servicer
under this Agreement or, alternatively, shall retain an agent that is
so licensed, qualified and in good standing in any such state.
Notwithstanding the foregoing, the Trustee, in its capacity as
successor Servicer shall not be responsible for the lack of information
and/or documents that it cannot obtain through reasonable efforts.
If the Trustee serves as successor Servicer, then the Trustee
in such capacity shall not be liable for any servicing of the Mortgage Loans
prior to its date of appointment as Servicer.
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Any successor Servicer or the Trustee shall be reimbursed for
all reasonable costs and expenses incurred in connection with the appointment of
the successor Servicer and the replacement of Fairbanks or Wilshire, as the case
may be, which reimbursement shall be paid (1) if the termination is for cause or
pursuant to SECTION 8.17(B), (C) or (F), first, by the predecessor Servicer, but
only the cost of deconversion and transfer of Servicing Files, and second, to
the extent that costs and expenses are not reimbursed within 30 days of demand
therefor or reimbursable by the predecessor Servicer, as a Trust Expense, from
amounts in the related Collection Account, and (2) if the termination is without
cause, pursuant to SECTION 8.17(A), by the Depositor.
(b) (i) If the Trustee is required to act as the successor
Servicer it shall, if it is unable to obtain a qualifying bid and is
prevented by law from acting as Servicer, appoint, or petition a court
of competent jurisdiction to appoint, any housing and home finance
institution, bank or mortgage servicing institution which has been
designated as an approved seller-servicer by ▇▇▇▇▇▇ ▇▇▇ or for first
and second mortgage loans and having equity of not less than
$10,000,000 (or such lower level as may be acceptable to the Trustee
and reasonably acceptable to the Certificate Insurer), as determined in
accordance with generally accepted accounting principles and acceptable
to the Trustee, the Certificate Insurer and the Depositor, as the
successor to Fairbanks or Wilshire, as applicable, hereunder in the
assumption of all or any part of the responsibilities, duties or
liabilities of Fairbanks or Wilshire, as applicable, hereunder.
(ii) In the event the Trustee solicits bids as provided above,
the Trustee shall solicit, by public announcement at least once in The
American Banker and such other publications as reasonably selected by
the Trustee as directed by the Depositor, bids from housing and home
finance institutions, banks and mortgage servicing institutions meeting
the qualifications set forth above. Such public announcement shall
specify that the successor Servicer shall be entitled to the full
amount of the aggregate Servicing Compensation as servicing
compensation but only with respect to the Fairbanks Mortgage Loans
Wilshire Mortgage Loans, as the case may be, as reduced by the
obligation to pay Compensating Interest. Within thirty days after any
such public announcement, the Trustee shall negotiate and effect the
sale, transfer and assignment of the servicing rights and
responsibilities hereunder to the qualified party approved by the
Depositor and the Certificate Insurer submitting the highest
satisfactory bid as to the price they will pay to obtain servicing. The
Trustee shall deduct from any sum received by the Trustee from the
successor Servicer in respect of such sale, transfer and assignment all
costs and expenses of any public announcement and of any sale, transfer
and assignment of the servicing rights and responsibilities hereunder.
After such deductions, the remainder of such sum less any amounts due
the Trustee or the Trust from the relevant predecessor Servicer shall
be paid by the Trustee to the relevant predecessor Servicer at the time
of such sale, transfer and assignment to the successor Servicer.
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(iii) The Trustee, upon assuming the duties of any Servicer
hereunder, shall immediately make all Monthly Advances which such
Servicer was required to make under the relevant Servicing Agreement
and has theretofore failed to remit with respect to the applicable
Mortgage Loans and deposit them into the relevant Collection Account;
PROVIDED, HOWEVER, that if the Trustee is acting as successor Servicer,
the Trustee shall only be required to make Monthly Advances (including
the Monthly Advances described in this clause (b)(iii)) if, in the
Trustee's reasonable good faith judgment, such Monthly Advances will
ultimately be recoverable from the applicable Mortgage Loans.
(c) SUCCESSOR SERVICER COMPENSATION. The compensation of any
successor Servicer (including, without limitation, the Trustee) so
appointed shall be an amount up to the aggregate Servicing Fee with
respect to the Mortgage Loans serviced by the predecessor Servicer,
together with the other Servicing Compensation provided herein.
(d) TERMINATION FEE TO PRIOR SERVICER. In the event Fairbanks
or Wilshire is terminated in whole or in part without cause pursuant to
SECTION 8.17(A), such prior Servicer shall be entitled to receive a
termination fee equal to $5 per each applicable Mortgage Loan. Upon
resignation, termination or removal of Fairbanks or Wilshire, for any
reason such prior Servicer shall be entitled to payment, within thirty
(30) days of the delivery of notice of such termination or resignation,
of any unpaid Servicing Compensation with respect to the Mortgage Loans
serviced by such prior Servicer and reimbursement of all expenses,
including unreimbursed Advances relating to such Mortgage Loans made
under this Agreement, to the date of termination or resignation;
PROVIDED, HOWEVER, that no termination fee or other liquidated or other
damages shall be payable to the prior Servicer if it is terminated for
cause pursuant to SECTION 8.17(B) or terminated pursuant to SECTION
8.17(C), or 8.17(F). The termination fee shall be an obligation of the
Depositor and not of the Trust or the Trustee.
(e) EFFECTIVENESS OF APPOINTMENT. Neither the Trustee nor any
other successor Servicer, as applicable, shall be held liable by reason
of any failure to make, or any delay in making, any payment or
distribution hereunder or any portion thereof caused by (i) the failure
of the prior Servicer to deliver, or any delay in delivering, cash,
documents or records to it or (ii) restrictions imposed by any
regulatory authority having jurisdiction over the prior Servicer
hereunder. No appointment of a successor to Fairbanks or Wilshire
hereunder shall be effective until the Depositor, the Trustee and the
Certificate Insurer shall have consented thereto.
8.19 INSPECTIONS OF SERVICERS; ERRORS AND OMISSIONS INSURANCE.
The Trustee, the Depositor, any Class X Certificateholder, the
Certificate Insurer or any agents thereof shall have the right, at its own
expense and during normal
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business hours upon reasonable prior notice, to review any and all of the books,
records, or other information of Fairbanks or Wilshire which may be relevant to
such Person's ability to confirm that such Servicer is complying with its
obligations to service the related Mortgage Loans in accordance with the terms
of this Agreement. In order to discuss such books, records or other information,
the relevant Servicer shall make personnel available who are knowledgeable about
such matters to such Persons or their respective designees. Each of Fairbanks
and Wilshire shall provide the above parties or any agents of any of them (1)
during normal business hours with on-line, read-only access to such Servicer's
servicing system and loan records, and (2) hard or electronic copies of books,
records, and other information as reasonably requested by such Persons. Each of
the Trustee and the Depositor shall reimburse the reasonable out-of-pocket
expenses incurred by Fairbanks or Wilshire in connection with any request
pursuant to this SECTION 8.19 from amounts on deposit in the Certificate
Account. Each of the Trustee and the Depositor shall maintain the
confidentiality of all such information, shall use all information only in
connection with this Agreement, and will comply with all applicable laws with
respect thereto, including without limitation, Subtitle A of Title V of the
▇▇▇▇▇-▇▇▇▇▇-▇▇▇▇▇▇ Act.
Each of Fairbanks and Wilshire agrees to maintain errors and
omissions coverage and a fidelity bond, each at least to the extent required by
Section 305 of Part I of the ▇▇▇▇▇▇ ▇▇▇ Guide or any successor provision
thereof; PROVIDED, HOWEVER, that if the Trustee shall become the Servicer, any
customary insurance coverage that the Trustee maintains shall be deemed
sufficient hereunder; provided, further, that in the event that the fidelity
bond or the errors and omissions coverage is no longer in effect, the Trustee
shall promptly give such notice to the Depositor and the Owners. Upon the
request of the Trustee, the Depositor or the Majority Class X Certificateholder,
Fairbanks or Wilshire, as applicable, shall cause to be delivered to such
requesting Person a certified true copy of such fidelity bond or errors and
omission policy.
8.20 NON-SOLICITATION.
Each of Fairbanks and Wilshire agrees that, after the Closing
Date, it will not take any action to solicit the refinancing of any Mortgage
Loan other than a Mortgage Loan that is more than 60 days Delinquent. It is
understood and agreed that promotions undertaken by Fairbanks or Wilshire or any
affiliate of any such Servicer which are directed to the general public at
large, including, without limitation, mass mailings based upon commercially
acquired mailing lists, newspaper, radio, television advertisements or from
servicing the refinancing needs of a Mortgagor related to a Fairbanks Mortgage
Loan or Wilshire Mortgage Loan who, without solicitation, contacts the relevant
Servicer in connection with the refinance of such Mortgage or Mortgage Loan,
shall not constitute solicitation under this SECTION 8.20. Notwithstanding
anything to the contrary, this SECTION 8.20 shall not prohibit any of Fairbanks
or Wilshire from soliciting any Mortgagor related to a Mortgage Loan serviced by
such Servicer to provide other services including but not limited to credit
cards, insurance investments and banking related services.
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8.21 MAJORITY CLASS X CERTIFICATEHOLDER PURCHASE RIGHT.
The Majority Class X Certificateholder shall have the right
and the option, but not the obligation, for administrative convenience, to
purchase for its own account any Mortgage Loan (i) which becomes a Defaulted
Mortgage Loan or (ii) as to which there exists a defect in the documentation
comprising the Custodial File, which defect the applicable Seller fails to
remedy in accordance with the relevant Sale Agreement and such defect materially
and adversely affects the interest of the Owners or the Certificate Insurer in
such Mortgage Loan. Any such Mortgage Loan so purchased shall be purchased by
the Majority Class X Certificateholder on a Remittance Date at a purchase price
equal to the Loan Purchase Price thereof, which purchase price shall be paid to
the Trustee for deposit into the Certificate Account as provided herein. Any
such purchase pursuant to clause (ii) of the preceding sentence shall occur
within 90 days of the Trustee's notice of such defect if the defect would
prevent the Mortgage Loan from being a Qualified Mortgage.
8.22 PERIODIC FILINGS.
(a) The Depositor shall prepare or cause to be prepared the initial
post closing filing of material agreements on Form 8-K. Thereafter, within 15
days after each Distribution Date, the Trustee shall, in accordance with
industry standards, file with the Commission via the Electronic Data Gathering
and Retrieval System (▇▇▇▇▇), a Form 8-K with a copy of the statement to the
Securityholders for such Distribution Date as an exhibit thereto. Prior to
January 30, 2004, the Trustee shall, in accordance with industry standards, file
a Form 15 Suspension Notification with respect to the Trust, if applicable.
Prior to March 31, 2004, the Trustee shall file a Form 10-K, in substance
conforming to industry standards, with respect to the Trust. The Depositor
agrees to promptly furnish to the Trustee, from time to time upon request, such
further information, reports, and financial statements within its control
related to the Trust Agreement and the Mortgage Loans as the Depositor
reasonably deems appropriate to prepare and file all necessary reports with the
Commission.
(b) The Trustee and the Servicers shall reasonably cooperate with the
Depositor in connection with the Trust's satisfying the reporting requirements
under the Exchange Act. The Trustee shall prepare on behalf of the Trust any
Forms 8-K and 10-K customary for similar securities as required by the Exchange
Act and the Rules and Regulations of the Securities and Exchange Commission
thereunder, and the Trustee shall sign and file (via the Securities and Exchange
Commission's Electronic Data Gathering and Retrieval System) such Forms on
behalf of the Depositor, if an officer of the Depositor signs the Certification
pursuant to paragraph (c) of this Section 8.22, or otherwise on behalf of the
Trust. In the event the Trustee is signing any form 8-K and/or Form 10-K on
behalf of the Depositor pursuant to the preceding sentence, the Depositor hereby
grants to the Trustee a limited power of attorney to execute and file each such
document on behalf of the Depositor. Such power of attorney shall continue until
the earlier of either (i) receipt by the Trustee from the Depositor of written
termination of such power of attorney and (ii) the termination of the Trust.
Notwithstanding the
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foregoing, the Trustee shall prepare such Form 10-K to be signed by the
Depositor and the Depositor shall sign such form unless the Securities and
Exchange Commission has indicated that it will accept a Certification signed by
the Depositor where the related Form 10-K is signed by the Trustee on behalf of
the Depositor.
(c) Any Form 10-K filed pursuant to subclause (a) above shall include
as exhibits the Servicers' annual statement of compliance described under
Section 8.13 and the accountant's report described under Section 8.14, in each
case to the extent they have been timely delivered to the Trustee. If they are
not so timely delivered, the Trustee shall file an amended Form 10-K including
such documents as exhibits reasonably promptly after they are delivered to the
Trustee. The Trustee shall have no liability with respect to any failure to
properly prepare or file such periodic reports resulting from or relating to the
Trustee's inability or failure to obtain any information not resulting from its
own negligence, willful misconduct or bad faith. The Form 10-K shall also
include a certification in the form attached hereto as Exhibit K (the
"CERTIFICATION"), which shall, except as described below, be signed by the
senior officer of the Depositor in charge of securitization. In connection with
the filing of any such Form 10-K, the Trustee shall provide a certification to
the Depositor (in the form attached hereto as Exhibit L-1) on which the
Depositor may rely. Notwithstanding the foregoing, if it is determined by the
Depositor that the Certification may be executed by multiple persons, the
Depositor shall sign the Certification in respect of items 1 through 3 thereof
and each Servicer shall cause the senior officer in charge of servicing at the
Servicer to sign the Certification in respect of items 4 and 5 thereof (in the
form attached hereto as Exhibit L-2) with respect to the Mortgage Loans serviced
by such Servicer, and the Depositor may rely on the Certification signed by the
Servicers.
(d) The Certification of the Trustee and of each Servicer in the forms
attached hereto as Exhibits L-1 and L-2 shall be delivered to the Depositor by
March 20th of each year (or if not a Business Day, the immediately preceding
Business Day). The Trustee and the relevant Servicer shall indemnify and hold
harmless the Depositor and its officers, directors and Affiliates from and
against any losses, damages, penalties, fines, forfeitures, reasonable and
necessary legal fees and related costs, judgments and other costs and expenses
arising out of or based upon a breach of such Person's obligations under this
Section 8.22(d) or such Person's negligence, bad faith or willful misconduct in
connection therewith. If the indemnification provided for herein is unavailable
or insufficient to hold harmless the indemnified party, then the Trustee or the
relevant Servicer, as applicable, agrees that it shall contribute to the amount
paid or payable by the Depositor as a result of the losses, claims, damages or
liabilities of the Depositor in such proportion as is appropriate to reflect the
relative fault of the Depositor on the one hand and the Trustee or the relevant
Servicer, as applicable, on the other in connection with a breach of the Trustee
or such Servicer's, obligations under this Section 8.22(d) or the Trustee or
such Servicer's negligence, bad faith or willful misconduct in connection
therewith. The Certification attached hereto as Exhibit K prepared by the
Depositor shall be delivered to the Trustee for filing by March 25th of each
year (or if not a Business Day, the immediately preceding Business Day).
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(e) Upon any filing with the Commission, the Trustee shall promptly
deliver to the Depositor and each Servicer a copy of any such executed report,
statement or information.
8.23 CREDIT REPORTING; ▇▇▇▇▇-▇▇▇▇▇-▇▇▇▇▇▇ ACT.
(a) With respect to each Mortgage Loan, the relevant Servicer
shall fully furnish, in accordance with the Fair Credit Reporting Act and its
implementing regulations, accurate and complete information (e.g., favorable and
unfavorable) on the related Mortgagor credit files to Equifax, Experian, and
TransUnion Credit Information Company (three of the credit repositories), on a
monthly basis.
(b) Each Servicer shall comply with Title V of the
▇▇▇▇▇-▇▇▇▇▇-▇▇▇▇▇▇ Act of 1999 and all applicable regulations promulgated
thereunder, relating to the related Mortgage Loans and the related borrowers and
shall provide all required notices thereunder.
ARTICLE IX
MASTER SERVICING AND ADMINISTRATION OF CONTRACTS
9.01 MASTER SERVICER.
Wilshire, in its capacity as Master Servicer of the Contracts
shall (i) collect all amounts remitted by GreenPoint pursuant to the GreenPoint
Servicing Agreement with respect to the Contracts, (ii) receive from GreenPoint
all information with respect to the Contracts which is required to be delivered
to the Master Servicer pursuant to the GreenPoint Servicing Agreement, (iii)
make Monthly Advances and payments of Compensating Interest with respect to the
Contracts as described in SECTIONS 9.02 and 9.03 hereof, (iv) promptly notify
the Trustee and the Certificate Insurer if GreenPoint shall fail to remit
amounts collected on the Contracts or forward all required information with
respect to the Contracts to the Master Servicer, (v) upon the termination or
resignation of GreenPoint in accordance with the terms of the GreenPoint
Servicing Agreement service the Contracts in accordance with the terms of the
GreenPoint Servicing Agreement for the benefit of the Trustee, the Owners and
the Certificate Insurer and (vi) promptly notify the Trustee and the Certificate
Insurer if GreenPoint has made a claim for indemnity from amounts on deposit in
the Collection Account maintained by the Master Servicer.
9.02 OBLIGATION OF THE MASTER SERVICER IN RESPECT OF MONTHLY
ADVANCES.
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If any Scheduled Payment on a Contract that was due on a
related Due Date is delinquent other than as a result of interest shortfalls due
to bankruptcy proceedings application of the Civil Relief Act, the Master
Servicer will deposit in the related Collection Account not later than the
Remittance Date, (i) with respect to each Actuarial Contract, an amount equal to
such deficiency, and (ii) with respect to each Simple Interest Contract, an
amount equal to the Simple Interest Shortfall which shall be paid from the
Simple Interest Excess Sub-Account maintained by Wilshire, or if such funds are
insufficient, from Wilshire's own funds, in each case net of the related
Servicing Fee for such Contract and except to the extent the Master Servicer
determines any such advance to be nonrecoverable from Liquidation Proceeds,
Insurance Proceeds or future payments on the Contract for which such Monthly
Advance was made. If applicable, on the related Remittance Date, the Master
Servicer shall present an Officer's Certificate to the Trustee (i) stating that
the Master Servicer elects not to make a Monthly Advance in a stated amount and
(ii) detailing the reason it deems the advance to be nonrecoverable. The Trustee
will provide notice to the Master Servicer by telecopy by the close of Business
on the Business Day prior to the Distribution Date in the event that the amount
remitted by the Master Servicer on such date is less than the Monthly Advances
required to be made by the Master Servicer for the related Distribution Date.
9.03 OBLIGATION OF THE MASTER SERVICER IN RESPECT OF
COMPENSATING INTEREST.
With respect to any Contract for which a Principal Prepayment
or a Curtailment that is more than two times the amount of the Scheduled Payment
due for such Collection Period was received during the related Collection
Period, the Master Servicer shall remit to the Trustee for deposit in the
Certificate Account from its own funds, an amount equal to the difference
between (a) 30 days' interest or, with respect to the first Remittance Date,
from the Closing Date, at the then applicable Mortgage Rate on such Contract and
(b) the amount of interest actually received on such Contract for such
Collection Period; PROVIDED, HOWEVER, that the Master Servicer shall not be
obligated to pay any interest shortfalls resulting from the application of the
Civil Relief Act for the related Collection Period.
The Master Servicer shall not be entitled to reimbursement for
amounts paid as Compensating Interest with respect to the Contracts.
9.04 TRUSTEE'S OBLIGATIONS IN RESPECT OF THE CONTRACTS.
The Trustee hereby acknowledges that the Depositor and the
Master Servicer have entered into the GreenPoint Servicing Agreement with
respect to the primary servicing of the Contracts by GreenPoint. The Trustee
hereby agrees and acknowledges that (i) it will execute such documents as are
prepared by and delivered to it by GreenPoint as are necessary in connection
with the servicing and administration of the Contracts, (ii) will promptly
notify the Depositor and the Certificate Insurer of the occurrence of a Servicer
Termination Event (as set forth in SECTION 6.01 of the
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GreenPoint Servicing Agreement) of which an Authorized Officer of the Trustee
shall have actual knowledge and (iii) in the event that the Master Servicer
resigns or is removed pursuant to this Agreement, it will become the successor
to the Master Servicer under the GreenPoint Servicing Agreement or appoint a
successor to the Master Servicer thereunder who shall meet the qualifications
set forth in Section 8.18(b) hereof.
9.05 DEPOSITOR'S OBLIGATIONS IN RESPECT OF THE CONTRACTS.
(a) In connection with the servicing and administration of the
Contracts by GreenPoint pursuant to the GreenPoint Servicing Agreement, the
Depositor hereby agrees and acknowledges that the Depositor will (i) not enter
into any amendment, waiver or supplement to the GreenPoint Servicing Agreement
without the prior written consent of the Certificate Insurer (which consent
shall not be unreasonably withheld), (ii) promptly notify the Trustee and the
Certificate Insurer of the occurrence of a Servicer Termination Event (as set
forth in Section 6.01 of the GreenPoint Servicing Agreement), (iii) not waive
any Servicer Termination Event (as set forth in the Section 6.01 of the
GreenPoint Servicing Agreement) unless directed by the Certificate Insurer, or
if a Certificate Insurer Default has occurred and is continuing, the Holders of
Certificates representing at least 25% of the aggregate Percentage Interests
evidencing by the Certificates; provided, however that any default in the making
of any required remittance to the Master Servicer for distribution on any of the
Certificates may be waived only by the Depositor at the direction of the
affected Certificateholders, and (iv) not terminate GreenPoint pursuant to
Section 7.02 of the GreenPoint Servicing Agreement, without cause, unless it
shall have first obtained the consent of the Certificate Insurer, which consent
shall not be unreasonably withheld (unless a Certificate Insurer Default has
occurred and is continuing).
Upon the occurrence of a Servicer Termination Event, then, and
in each and every such case, so long as such Servicer Termination Event shall
not have been cured or waived, the Depositor may, with the consent of the
Trustee and the Certificate Insurer (which consent shall not be unreasonably
withheld; provided that if a Certificate Insurer Default has occurred and is
continuing, no consent of the Certificate Insurer needs to be obtained) by
notice in writing to GreenPoint, terminate all the rights and obligations of
GreenPoint under the GreenPoint Servicing Agreement, including, without
limitation, all rights with respect to the Contracts and the proceeds thereof,
except any responsibility for its acts or omissions during its tenure as
Servicer thereunder. On or after the receipt by GreenPoint of such written
notice, all authority and power of the GreenPoint under the GreenPoint Servicing
Agreement, whether with respect to the Contracts or otherwise, shall pass to and
be vested in the Master Servicer or such other successor appointed pursuant to
Section 5.06 of the GreenPoint Servicing Agreement. Upon the occurrence of a
Servicer Termination Event which shall not have been remedied, the Depositor
may, and shall at the direction of the Certificate Insurer or the Trustee also
pursue whatever rights it may have at law or in equity to damages, including
injunctive relief and specific performance.
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(b) In addition, upon the occurrence a GreenPoint Termination Trigger Event, the
Certificate Insurer shall have the right to direct the Depositor to terminate
the rights and obligations of GreenPoint under the GreenPoint Servicing
Agreement which shall constitute a termination without cause pursuant to Section
7.02 of the GreenPoint Servicing Agreement. A "GreenPoint Termination Trigger
Event" shall occur if on any date of determination (i) the Three-Month Rolling
Average Sixty-Day Delinquency Rate of the Contracts exceeds 6% of the aggregate
Principal Balance of the Contracts or (ii) the quotient (expressed as a
percentage) of (x) the aggregate amount of Realized Losses incurred on the
Contracts since the Cut-off Date through the last day of the related Collection
Period divided by (y) the aggregate Principal Balance of the Contracts as of the
Cut-off Date, exceeds the applicable percentages set forth below with respect to
such Distribution Date:
-------------------------------------------------------------------------------------------------------
DISTRIBUTION DATE OCCURRING IN LOSS PERCENTAGE
------------------------------ ---------------
-------------------------------------------------------------------------------------------------------
February 2006 through January 2007 6.00% for the first month, plus an additional
1/12th of 1.50% for each month thereafter, to
7.50%
-------------------------------------------------------------------------------------------------------
February 2007 through January 2008 7.50% for the first month, plus an additional
1/12th of 1.50% for each month thereafter, to
9.00%
-------------------------------------------------------------------------------------------------------
February 2008 through January 2009 9.00% for the first month, plus an additional
1/12th of 1.50% for each month thereafter, to
11.00%
-------------------------------------------------------------------------------------------------------
February 2009 and thereafter 11.00%
-------------------------------------------------------------------------------------------------------
In connection with any termination without cause of GreenPoint
under the GreenPoint Servicing Agreement, including without limitation, the
termination of GreenPoint upon the occurrence of a GreenPoint Termination
Trigger Event, the Depositor shall be responsible for the payment of any
termination fee due GreenPoint in connection therewith from its own funds and
without reimbursement therefor.
ARTICLE X
TERMINATION OF TRUST
10.01 TERMINATION OF TRUST.
---------------------
The Trust created hereunder and all obligations created by
this Agreement will terminate upon the payment to the holders of all
Certificates and the Certificate Insurer of all amounts held by the Trustee and
required to be paid to such Owners
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pursuant to this Agreement upon the latest to occur of (a) the final payment or
other liquidation (or any advance made with respect thereto) of the last
Mortgage Loan in the Trust Estate, (b) the disposition of all property acquired
in respect of any Mortgage Loan remaining in the Trust Estate, and (c) at any
time when a Qualified Liquidation of the Mortgage Loans included within the
Trust is effected as described below. To effect a termination of this Agreement
pursuant to CLAUSE (C) above, the holders of all Certificates then Outstanding,
with the consent of the Certificate Insurer shall (i) unanimously direct the
Trustee on behalf of each REMIC to adopt a plan of complete liquidation as
contemplated by Section 860F(a)(4) of the Code and (ii) provide to the Trustee
an opinion of counsel experienced in federal income tax matters acceptable to
the Depositor and the Trustee to the effect that each such liquidation
constitutes a Qualified Liquidation, and the Trustee either shall sell the
Mortgage Loans and distribute the proceeds of the liquidation of the Trust
Estate, or shall distribute equitably in kind all of the assets of the Trust
Estate to the remaining holders of the Certificates each in accordance with such
plan, so that the liquidation or distribution of the Trust Estate, the
distribution of any proceeds of the liquidation and the termination of this
Agreement occur no later than the close of the 90th day after the date of
adoption of the plan of liquidation and such liquidation qualifies as a
Qualified Liquidation. In no event, however, will the Trust created by this
Agreement continue beyond the expiration of twenty-one (21) years from the death
of the last survivor of the descendants of ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇, the late
Ambassador of the United States to the Court of Saint ▇▇▇▇▇, living on the date
hereof. The Trustee shall give written notice of termination of the Agreement to
each Owner in the manner set forth in SECTION 12.05.
10.02 TERMINATION UPON OPTION OF CERTIFICATEHOLDERS.
----------------------------------------------
The Majority Class X Certificateholder may, but shall not be
obligated to, purchase from the Trust or cause the sale by the Trust of all but
not less than all of the remaining Mortgage Loans in the Trust, thereby retiring
the Offered Certificates, whenever the Pool Balance is equal to or less than 10%
of the Original Pool Balance by furnishing notice to the Trustee, the
Certificate Insurer and the Servicers at least four Business Days preceding such
Distribution Date. If the Majority Class X Certificateholder does not exercise
such option on any Distribution Date, the Certificate Insurer may do so by
furnishing notice to the Trustee and the Majority Class X Certificateholder at
least three Business Days prior to such Distribution Date. The purchase price
for the Mortgage Loans shall be a price equal to the greater of (i) the
aggregate fair market value of the Mortgage Loans and other assets of the Trust
and (ii) the Pool Balance plus all accrued unpaid interest thereon through the
Due Date in the Collection Period in which such purchase occurs plus the fair
market value of all REO Properties in the Trust, plus, without duplication, the
amount of all outstanding Advances (and interest thereon, if required to be paid
pursuant to this Agreement) and all unpaid Servicing Compensation and all
amounts owing to the Certificate Insurer.
10.03 TERMINATION UPON LOSS OF REMIC STATUS.
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At any time on or after the date which is thirty (30) calendar
days following a Final Determination the holders of a majority in Percentage
Interests represented by the Class A, Class M-1 and Class B Certificates then
Outstanding may direct the Trustee on behalf of the Trust to adopt a plan of
complete liquidation, as contemplated by Section 860F(a)(4) of the Code.
Upon receipt of such direction from the Holders of the Class
A, Class M-1 and Class B Certificates, the Trustee shall notify the Holders of
the Class R Certificates of such election to liquidate or such determination to
purchase, as the case may be (the "TERMINATION NOTICE"). The Holders of a
majority of the Percentage Interests of the Class R Certificates then
Outstanding may, within sixty (60) days from the date of receipt of the
Termination Notice (the "PURCHASE OPTION PERIOD"), at their option, purchase
from the Trust all (but not fewer than all) Mortgage Loans and all property
theretofore acquired by foreclosure, deed in lieu of foreclosure, or otherwise
then remaining in the Trust Estate at a purchase price equal to the Pool Balance
as of the date of such purchase, plus (a) one month's interest on such amount at
the Mortgage Rates, (b) the aggregate amount of any unreimbursed Advances (and
interest thereon if required to be paid pursuant to this Agreement) and Trust
Expenses, (c) any Monthly Advances which the Servicer or the Master Servicer has
theretofore failed to remit, and (d) all amounts owing to the Certificate
Insurer. If, during the Purchase Option Period, the holders of the Class R
Certificates have not exercised the option described in the immediately
preceding sentence, then upon the expiration of the Purchase Option Period in
the event that the holders of the Class A, Class M-1 Certificates and Class B
Certificates have given the Trustee the direction described in clause (i) of the
immediately preceding paragraph, the Trustee shall sell the Mortgage Loans and
distribute the proceeds of the liquidation of the Trust Estate, each in
accordance with the plan of complete liquidation, such that, if so directed, the
liquidation of the Trust Estate, the distribution of the proceeds of the
liquidation and the termination of this Agreement occur no later than the close
of the sixtieth (60th) day, or such later day as the holders of the Class A,
Class M-1, and Class B Certificates shall permit or direct in writing, after the
expiration of the Purchase Option Period.
10.04 DISPOSITION OF PROCEEDS.
------------------------
The Trustee shall, upon receipt thereof, deposit into the
Collections Account the proceeds of any liquidation of the Trust Estate pursuant
to this Article X as if they were collections on the Mortgage Loans.
10.05 FINAL DISTRIBUTION ON THE CERTIFICATES.
---------------------------------------
In connection with the termination of the trust as described
in Section 10.01 or 10.02 hereof, the Trustee shall promptly send a Notice of
Final Distribution to each Owner not later than the 15th day of the month of
such final distribution. Such Notice of Final Distribution shall specify the
Distribution Date upon which final distribution on the Certificates will be made
upon presentation and surrender of Certificates at the office therein
designated, (b) the amount of such final distribution,
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(c) the location of the office or agency at which such presentation and
surrender must be made, and (d) that the Record Date otherwise applicable to
such Distribution Date is not applicable, distributions being made only upon
presentation and surrender of the Certificates at the office therein specified.
The Trustee will give such Notice of Final Distribution to each Rating Agency
and the Certificate Insurer at the time such Notice of Final Distribution is
given to Owners.
In the event such Notice of Final Distribution is given, each
Servicer shall cause all funds in the relevant Collection Account to be remitted
to the Trustee for deposit in the Certificate Account on the Business Day prior
to the applicable Distribution Date in an amount equal to the final distribution
in respect of the Certificates net of any amounts on deposit therein which shall
be used to pay the Servicer any amounts due it pursuant to the terms of this
Agreement. Upon such final deposit with respect to the Trust Fund and the
receipt by the Trustee of a Request for Release therefor, the Trustee shall
promptly release or cause the release to the Depositor or its designee the
Custodial Files for the Mortgage Loans.
Upon presentation and surrender of the Certificates, the
Trustee shall cause to be distributed to the Owners of each Class of
Certificates (after reimbursement of all amounts due the Servicers, the
Depositor, the Certificate Insurer and the Trustee hereunder), in each case on
the final Distribution Date and in the order set forth in Section 7.06(b), in
proportion to their respective Percentage Interests, with respect to
Certificateholders of the same Class, an amount up to an amount equal to (i) as
to each Class of Regular Certificates (except the Class X Certificate), the
Certificate Balance thereof plus for each such Class and the Class X Certificate
accrued interest thereon in the case of an interest-bearing Certificate and all
other amounts to which such Classes are entitled pursuant to Section 7.06(b) or
Section 7.06(c), (ii) as to the Residual Certificates, the amount, if any, which
remains on deposit in the Distribution Account (other than the amounts retained
to meet claims) after application pursuant to clause (i) above and (iii) to the
Class P Certificates, any Prepayment Penalities remitted by the Servicers with
respect to the Mortgage Loans.
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In the event that any affected Owner shall not surrender
Certificates for cancellation within six months after the date specified in the
above mentioned written notice, the Trustee shall give a second written notice
to the remaining Owners to surrender their Certificates for cancellation and
receive the final distribution with respect thereto. If within six months after
the second notice all the applicable Certificates shall not have been
surrendered for cancellation, the Trustee may take appropriate steps, or may
appoint an agent to take appropriate steps, to contact the remaining Owners
concerning surrender of their Certificates, and the cost thereof shall be paid
out of the funds and other assets which remain a part of the Trust Fund. If
within one year after the second notice all Certificates shall not have been
surrendered for cancellation, the Class R Certificateholders shall be entitled
to all unclaimed funds and other assets of the Trust Fund which remain subject
hereto.
ARTICLE XI
THE TRUSTEE
11.01 CERTAIN DUTIES AND RESPONSIBILITIES.
------------------------------------
(a) The Trustee (i) undertakes to perform such duties and only such
duties as are specifically set forth in this Agreement, and no implied covenants
or obligations shall be read into this Agreement against the Trustee and (B) the
banking institution that is the Trustee shall serve as the Trustee at all times
under this Agreement, and (ii) in the absence of bad faith on its part, may
conclusively rely, as to the truth of the statements and the correctness of the
opinions expressed therein, upon certificates or opinions furnished pursuant to
and conforming to the requirements of this Agreement; but in the case of any
such certificates or opinions which by any provision hereof are specifically
required to be furnished to the Trustee, shall be under a duty to examine the
same to determine whether or not they conform on their face to the requirements
of this Agreement. The Trustee, upon receipt of all resolutions, certificates,
statements, opinions, reports, documents, orders or other instruments furnished
to the Trustee which are specifically required to be furnished pursuant to any
provision of this Agreement, shall examine them to determine whether they
conform on their face to the requirements of this Agreement; PROVIDED, HOWEVER,
that the Trustee shall not be responsible for the accuracy or content of any
resolution, certificate, statement, opinion, report, document, order or other
instrument furnished by a Servicer, the Master Servicer or the Depositor
hereunder. If any such instrument is found not to conform in any material
respect to the requirements of this Agreement, the Trustee shall notify the
Owners of such instrument in the event that the Trustee, after so requesting,
does not receive a satisfactory corrected instrument.
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(b) No provision of this Agreement shall be construed to relieve the
Trustee from liability for its own negligent action, its own negligent failure
to act or its own willful misconduct, except that:
(i) this SUBSECTION shall not be construed to limit the effect of
SECTION 11.01(A);
(ii) the Trustee shall not be liable for any error of judgment made in
good faith by an Authorized Officer, unless it shall be proved that the Trustee
was negligent in ascertaining the pertinent facts;
(iii) the Trustee shall not be liable with respect to any action taken
or omitted to be taken by it in good faith in accordance with the direction of
the holders of a majority in Percentage Interest of the Certificates of the
affected Class or Classes, or the Certificate Insurer relating to the time,
method and place of conducting any proceeding for any remedy available to the
Trustee, or exercising any trust or power conferred upon the Trustee, under this
Agreement relating to such Certificates;
(iv) Prior to the occurrence of an Event of Default of which an
Authorized Officer of the Trustee shall have actual knowledge, 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, the Trustee shall not be liable except for the performance of
such duties and obligations as are specifically set forth in this Agreement, no
implied covenants or obligations shall be read into this Agreement against the
Trustee and, in the absence of bad faith on the part of the Trustee, the Trustee
may conclusively rely, as to the truth of the statements and the correctness of
the opinions expressed therein, upon any certificates or opinions furnished to
the Trustee and conforming to the requirements of this Agreement;
(v) The Trustee shall not be required to take notice or be deemed to
have notice or knowledge or any default or Event of Default unless an Authorized
Officer of the Trustee shall have received written notice thereof. In the
absence of receipt of such notice, the Trustee may conclusively assume that
there is no default or Event of Default; and
(vi) The Trustee shall have no duty (A) to see to any recording,
filing, or depositing of this Agreement or any agreement referred to herein or
any financing statement or continuation statement evidencing a security
interest, or to see to the maintenance of any such recording or filing or
depositing or to any re-recording, refiling or redepositing of any thereof, (B)
to see to any insurance, (C) to see to the payment or discharge of any tax,
assessment, or other governmental charge or any lien or encumbrance of any kind
owing with respect to, assessed or levied against, any part of the Trust other
than from funds available in the Certificate Account and (D) to confirm or
verify the contents of any reports or certificates of any Servicer, the Master
Servicer or any other Person delivered to the Trustee
135
pursuant to this Agreement believed by the Trustee to be genuine and to have
been signed or presented by the proper party or parties.
(c) Whether or not therein expressly so provided, every provision of
this Agreement relating to the conduct or affecting the liability of or
affording protection to the Trustee shall be subject to the provisions of this
SECTION.
(d) No provision of this Agreement shall require the Trustee to expend
or risk its own funds or otherwise incur any financial liability in the
performance of any of its duties hereunder, or in the exercise of any of its
rights or powers, if it shall have reasonable grounds for believing that
repayment of such funds or adequate indemnity against such risk or liability is
not reasonably assured to it. None of the provisions contained in this Agreement
shall in any event require the Trustee to perform, or be responsible for the
manner of performance of, any of the obligations of any Servicer, the Master
Servicer or the Depositor under this Agreement, except during such time, if any,
as the Trustee shall be the successor to, and be vested with the rights, duties,
powers and privileges of, any Servicer in accordance with the terms of this
Agreement.
(e) The permissive right of the Trustee to take actions enumerated in
this Agreement shall not be construed as a duty and the Trustee shall not be
answerable for other than its own negligence or willful misconduct.
(f) The Trustee shall be under no obligation to institute any suit, or
to take any remedial proceeding under this Agreement, or to take any steps in
the execution of the trusts hereby created or in the enforcement of any rights
and powers hereunder until it shall be indemnified to its satisfaction against
any and all costs and expenses, outlays and counsel fees and other reasonable
disbursements and against all liability, except liability which is adjudicated
to have resulted from its negligence or willful misconduct, in connection with
any action so taken.
11.02 CERTAIN RIGHTS OF THE TRUSTEE.
------------------------------
Except as otherwise provided in SECTION 11.01:
(a) the Trustee may rely and shall be protected in acting or refraining
from acting upon any resolution, certificate, statement, instrument, opinion,
report, notice, request, direction, consent, order, bond, note or other paper or
document believed by it to be genuine and to have been signed or presented by
the proper party or parties;
(b) any request or direction of the Depositor, or the holders of any
Class of Certificates mentioned herein shall be sufficiently evidenced in
writing;
(c) whenever in the administration of this Agreement the Trustee shall
deem it desirable that a matter be proved or established prior to taking,
suffering
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or omitting any action hereunder, the Trustee (unless other evidence be herein
specifically prescribed) may, in the absence of bad faith on its part, rely upon
an Officer's Certificate opinion of counsel, certificate of auditors or any
other certificate, statement, instrument, opinion, report, notice, request,
consent, order, appraisal, bond or other paper or document believed by it to be
genuine and to have been signed or presented by the proper party or parties;
(d) the Trustee may consult with counsel, and any advice or opinion of
such counsel (selected in good faith by the Trustee) shall be full and complete
authorization and protection in respect of any action taken, suffered or omitted
by it hereunder in good faith and in reliance thereon;
(e) the Trustee shall be under no obligation to exercise any of the
rights or powers vested in it by this Agreement at the request or direction of
any of the Owners or the Certificate Insurer pursuant to this Agreement, unless
such Owners or the Certificate Insurer shall have offered to the Trustee
reasonable security or indemnity satisfactory to the Trustee against the costs,
expenses and liabilities which might be incurred by it in compliance with such
request or direction;
(f) the Trustee shall not be bound to make any investigation into the
facts or matters stated in any resolution, certificate, statement, instrument,
opinion, report, notice, request, direction, consent, order, bond, note or other
paper or document, but the Trustee in its discretion may make such further
inquiry or investigation into such facts or matters as it may see fit; PROVIDED,
HOWEVER, that if the payment within a reasonable time to the Trustee of the
costs, expenses or liabilities likely to be incurred by it in the making of such
investigation is, in the opinion of the Trustee, not assured to the Trustee by
the security afforded to it by the terms of this Agreement, the Trustee may
require indemnity satisfactory to the Trustee against such cost, expense or
liability as a condition to taking any such action;
(g) the Trustee may execute any of the trusts or powers hereunder or
perform any duties hereunder either directly or by or through agents, attorneys
or custodians, and the Trustee shall not be responsible for any misconduct or
negligence on the part of any such agent, attorney or custodian appointed by the
Trustee with due care;
(h) the Trustee shall not be liable for any action it takes or omits to
take in good faith which it reasonably believes to be authorized by the
Authorized Officer of any Person or within its rights or powers under this
Agreement other than as to validity and sufficiency of its authentication of the
Certificates;
(i) the right of the Trustee to perform any discretionary act
enumerated in this Agreement shall not be construed as a duty, and the Trustee
shall not be answerable for other than its negligence or willful misconduct in
the performance of such act;
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(j) pursuant to the terms of this Agreement, the Servicers are required
to furnish to the Trustee from time to time certain information and to make
various calculations which are relevant to the performance of the Trustee's
duties under this Agreement. The Trustee shall be entitled to rely in good faith
on any such information and calculations in the performance of its duties
hereunder, unless and until an Authorized Officer of the Trustee has actual
knowledge, or is advised by any Owner (either in writing or orally with prompt
written or telecopier confirmation), that such information or calculations is or
are incorrect; and
(k) the Trustee shall not be required to give any bond or surety in
respect of the execution of the Trust Estate created hereby or the powers
granted hereunder.
11.03 NOT RESPONSIBLE FOR RECITALS OR ISSUANCE OF CERTIFICATES.
---------------------------------------------------------
The recitals and representations contained herein and in the
Certificates, except any such recitals and representations made by the Trustee,
shall be taken as the statements of the Depositor and the Trustee assumes no
responsibility for their correctness. The Trustee makes no representation as to
the validity or sufficiency of this Agreement, of the Certificates, or any
Mortgage Loan or document related thereto other than as to validity and
sufficiency of its authentication of the Certificates. The Trustee shall not be
accountable for the use or application by the Depositor of any of the
Certificates or of the proceeds of such Certificates, or for the use or
application of any funds paid to the Depositor, either of the Sellers or any
Servicers in respect of the Mortgage Loans or deposited into or withdrawn from
the related Collection Account or the Certificate Account by the Depositor, any
Servicer or either of the Sellers, and shall have no responsibility for filing
any financing or continuation statement in any public office at any time or
otherwise to perfect or maintain the perfection of any security interest or lien
or to prepare or file any tax returns for the Trust or to record this Agreement.
The Trustee shall not be required to take notice or be deemed to have notice or
knowledge of any default unless an Authorized Officer of the Trustee shall have
received written notice thereof or an Authorized Officer has actual knowledge
thereof. In the absence of receipt of such notice, the Trustee may conclusively
assume that no default has occurred.
11.04 MAY HOLD CERTIFICATES.
----------------------
The Trustee, any Paying Agent, Registrar or any other agent of the
Trust, in its individual or any other capacity, may become an Owner or pledgee
of Certificates and may otherwise deal with the Trust with the same rights it
would have if it were not Trustee, any Paying Agent, Registrar or such other
agent.
11.05 MONEY HELD IN TRUST.
--------------------
Money held by the Trustee in trust hereunder need not be segregated
from other trust funds except to the extent required herein or required by Law.
The Trustee
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shall be under no liability for interest on any money received by it hereunder
except as otherwise agreed with the Depositor and except to the extent of income
or other gain on investments which are deposits in or certificates of deposit of
the Trustee in its commercial capacity.
11.06 COMPENSATION AND REIMBURSEMENT; NO LIEN FOR FEES.
-------------------------------------------------
The Trustee shall receive compensation for fees and
reimbursement for expenses pursuant to SECTIONS 2.05 and 7.06. The Trustee shall
have no lien on the Trust Estate for the payment of such fees and expenses.
11.07 CORPORATE TRUSTEE REQUIRED; ELIGIBILITY.
----------------------------------------
There shall at all times be a Trustee hereunder which shall be
a corporation or association 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 at least
$50,000,000 subject to supervision or examination by the United States of
America, acceptable to the Depositor and having a deposit rating of at least
"A2" by Moody's (or such lower rating as may be acceptable to Moody's), and
deposit rating of "A" (and a short-term rating of "A-1" or better) by Standard &
Poor's (or such lower rating as may be acceptable to Standard & Poor's). If such
Trustee publishes reports of condition at least annually, pursuant to law or to
the requirements of the aforesaid supervising or examining authority, then for
the purposes of this SECTION, the combined capital and surplus of such
corporation or association shall be deemed to be its combined capital and
surplus as set forth in its most recent report of condition so published. If at
any time the Trustee shall cease to be eligible in accordance with the
provisions of this SECTION, it shall, upon the request of the Certificate
Insurer or the Depositor, resign immediately in the manner and with the effect
hereinafter specified in this ARTICLE XI.
11.08 RESIGNATION AND REMOVAL; APPOINTMENT OF SUCCESSOR.
-------------------------------------------------
(a) No resignation or removal of the Trustee and no appointment
of a successor trustee pursuant to this ARTICLE XI shall become
effective until the acceptance of appointment by the successor trustee
under SECTION 11.09.
(b) The Trustee, or any trustee or trustees hereafter appointed,
may resign from the duties and obligations hereby imposed on it by
this Agreement at any time by giving sixty (60) days' prior written
notice of resignation to the Depositor and by mailing notice of
resignation by first-class mail, postage prepaid, to the Depositor,
the Servicers, the Certificate Insurer and the Owners at their
addresses appearing on the Register. Additionally, a copy of such
notice shall be sent by the resigning Trustee to the Rating Agencies.
Upon receiving notice of resignation, the Depositor shall promptly
appoint a successor trustee or trustees acceptable to the Certificate
Insurer (or if a Certificate Insurer Default has occurred and is
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continuing, acceptable to the Owners of a majority in Percentage
Interest of the Offered Certificates then Outstanding) by written
instrument, in duplicate, executed on behalf of the Trust by an
Authorized Officer of the Depositor, one copy of which instrument
shall be delivered to the Trustee so resigning and one copy to the
successor trustee or trustees. If no successor trustee shall have been
appointed and have accepted appointment within thirty (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, or, the Certificate Insurer, or any Owner may, on
behalf of himself and all others similarly situated, petition any such
court for the appointment of a successor trustee. Such court may
thereupon, after such notice, if any, as it may deem proper and
appropriate, appoint a successor trustee. No resignation of the
Trustee under this SECTION 11.08(B) shall become effective until the
appointment of a successor trustee.
(c) If at any time the Trustee shall cease to be eligible under
SECTION 11.07 and shall fail to resign after written request therefor
by the Depositor or the Certificate Insurer, the Depositor, with the
consent of the Certificate Insurer, may remove the Trustee and appoint
a successor trustee acceptable to the Certificate Insurer by written
instrument, in duplicate, executed on behalf of the Trust by an
Authorized Officer of the Depositor, one copy of which instrument
shall be delivered to the Trustee so removed and one copy to the
successor trustee.
(d) The Certificate Insurer (or if a Certificate Insurer Default
has occurred and is continuing, the Owners of a majority of the
Percentage Interests represented by the Class A Certificates or, if
there are no Class A Certificates then Outstanding, by a majority of
the Percentage Interests represented by the Class M-1 Certificates, or
if there are no Class A Certificates or Class M-1 Certificates then
Outstanding, by a majority of the Percentage Interests represented by
the Class B Certificates), may at any time remove the Trustee and
appoint a successor trustee acceptable to the Depositor by delivering
to the Trustee to be removed, to the successor trustee so appointed,
to the Depositor and to the Servicer copies of the record of the act
taken by the Owners, as provided for in SECTION 12.03. All expenses
incurred by the Trustee in connection with its removal pursuant to
this clause (d) shall be reimbursed to it from amounts on deposit in
the Certificate Account within 30 days of request therefor.
(e) If the Trustee fails to perform its duties in accordance with
the terms of this Agreement, becomes ineligible pursuant to SECTION
11.07 to serve as Trustee, or becomes subject to any bankruptcy,
insolvency, reorganization or similar proceedings under any law, the
Depositor, with the consent of the Certificate Insurer, or the
Certificate Insurer (or if a Certificate Insurer Default has occurred
and is continuing Owners of a majority of the Percentage Interests
represented by the Class A Certificates or, if there are no Class A
Certificates then Outstanding, by a majority of the Percentage
Interests represented by the Class M-1 Certificates, or if there are
no Class A Certificates or Class M-1 Certificates
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then Outstanding, by a majority of the Percentage Interests
represented by the Class B Certificates), may remove the Trustee and
appoint a successor trustee by written instrument, in duplicate,
signed by the Depositor duly authorized, one complete set of which
instruments shall be delivered to the Trustee so removed and one
complete set to the successor Trustee so appointed.
(f) If the Trustee shall resign, be removed or become incapable
of acting, or if a vacancy shall occur in the office of the Trustee
for any cause, the Depositor shall promptly appoint a successor
trustee acceptable to the Certificate Insurer (or if a Certificate
Insurer Default has occurred and is continuing the Owners of a
majority of the Percentage Interests represented by the Class A
Certificates or, if there are no Class A Certificates then
Outstanding, by a majority of the Percentage Interests represented by
the Class M-1 Certificates, or if there are no Class A Certificates or
Class M-1 Certificates then Outstanding, by a majority of the
Percentage Interests represented by the Class B Certificates). If
within one year after such resignation, removal or incapability or the
occurrence of such vacancy, a successor trustee shall be appointed by
act of the holders of a majority of the Percentage Interests
represented by the Class A Certificates then Outstanding, or, if there
are no Class A Certificates then Outstanding, by such majority of the
Percentage Interests represented by the Class M-1 Certificates, or if
there are no Class M-1 Certificates then Outstanding, by such majority
of the Percentage Interest represented by the Class B Certificates,
the successor trustee so appointed shall forthwith upon its acceptance
of such appointment become the successor trustee and supersede the
successor trustee appointed by the Depositor. If no successor trustee
shall have been so appointed by the Depositor or the Owners and shall
have accepted appointment in the manner hereinafter provided, any
Owner may, on behalf of himself and all others similarly situated,
petition any court of competent jurisdiction for the appointment of a
successor trustee. Such court may thereupon, after such notice, if
any, as it may deem proper and prescribe, appoint a successor trustee.
(g) The Depositor shall give notice of any removal of the Trustee
by mailing notice of such event by first-class mail, postage prepaid,
to the Servicers, the Rating Agencies and to the Owners as their names
and addresses appear in the Register. Each notice shall include the
name of the successor Trustee and the address of its corporate trust
office.
11.09 ACCEPTANCE OF APPOINTMENT BY SUCCESSOR TRUSTEE.
-----------------------------------------------
Every successor trustee appointed hereunder shall execute, acknowledge
and deliver to the Depositor on behalf of the Trust and to its predecessor
Trustee an instrument accepting such appointment hereunder and stating its
eligibility to serve as Trustee 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 vested with
all the rights, powers, trusts, duties and obligations of its predecessor
hereunder; but, on request of the Depositor or the successor Trustee,
141
such predecessor Trustee shall, upon payment of its charges then unpaid, execute
and deliver an instrument transferring to such successor trustee all of the
rights, powers and trusts of the Trustee so ceasing to act, and shall duly
assign, transfer and deliver to such successor trustee all property and money
held by such Trustee so ceasing to act hereunder. Upon request of any such
successor trustee, the Depositor on behalf of the Trust shall execute any and
all instruments for more fully and certainly vesting in and confirming to such
successor trustee all such rights, powers and trusts.
Upon acceptance of appointment by a successor Trustee as provided in
this SECTION, the Depositor shall mail notice thereof by first-class mail,
postage prepaid, to the Owners at their last addresses appearing upon the
Register. The Depositor shall send a copy of such notice to the Servicers and
the Rating Agencies. If the Depositor 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 at the expense of the Trust.
No successor trustee shall accept its appointment unless at the time of
such acceptance such successor shall be qualified and eligible under this
ARTICLE XI.
11.10 MERGER, CONVERSION, CONSOLIDATION OR SUCCESSION TO BUSINESS OF THE
------------------------------------------------------------------
TRUSTEE.
--------
Any corporation or association into which the Trustee may be merged or
converted or with which it may be consolidated, or any corporation or
association resulting from any merger, conversion or consolidation to which the
Trustee shall be a party, or any corporation or association succeeding to all or
substantially all of the corporate trust business of the Trustee, shall be the
successor of the Trustee hereunder, without the execution or filing of any paper
or any further act on the part of any of the parties hereto; PROVIDED, HOWEVER,
that such corporation or association shall be otherwise qualified and eligible
under this ARTICLE XI. In case any Certificates have been executed, but not
delivered, by the Trustee then in office, any successor by merger, conversion or
consolidation to such Trustee may adopt such execution and deliver the
Certificates so executed with the same effect as if such successor Trustee had
itself executed such Certificates.
11.11 REPORTING; WITHHOLDING.
-----------------------
(a) The Trustee shall timely provide to the Owners the Internal
Revenue Service's Form 1099 and any other statement required by
applicable Treasury regulations as determined by the Tax Matters
Person, and shall withhold, as required by applicable law, federal,
state or local taxes, if any, applicable to distributions to the
Owners, including but not limited to backup withholding under Section
3406 of the Code and the withholding tax on distributions to foreign
investors under Sections 1441 and 1442 of the Code.
(b) As required by law or upon request of the Tax Matters Person
and except as otherwise specifically set forth in SUBSECTION (A)
above, the Trustee shall
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timely file all reports prepared by the Depositor and required to be
filed by the Trust with any federal, state or local governmental
authority having jurisdiction over the Trust, including other reports
that must be filed by the Owners, such as the Internal Revenue
Service's Form 1066 and Schedule Q and the form required under Section
6050K of the Code, if applicable to REMICs. Furthermore, the Trustee
shall report to the Owners, if required, with respect to the
allocation of expenses pursuant to Section 212 of the Code in
accordance with the specific instructions to the Trustee by the
Depositor with respect to such allocation of expenses. The Trustee
shall, upon request of the Depositor, collect any forms or reports
from the Owners determined by the Depositor to be required under
applicable federal, state and local tax laws.
(c) The Depositor covenants and agrees that it shall provide to
the Trustee any information necessary to enable the Trustee to meet
its obligations under SECTION 11.11(A) and (B).
(d) Except as otherwise provided, the Depositor shall have the
responsibility for preparation of all returns, forms, reports and
other documents referred to in this SECTION and the Trustee's
responsibility shall be to execute such documents.
11.12 LIABILITY OF THE TRUSTEE.
-------------------------
The Trustee shall be liable in accordance herewith only to the extent
of the obligations specifically imposed upon and undertaken by the Trustee
herein. Neither the Trustee nor any of the directors, officers, employees or
agents of the Trustee shall be under any liability on any Certificate or
otherwise to the Depositor, either of the Sellers, any Servicer or any Owner for
any action taken or for refraining from the taking of any action in good faith
pursuant to this Agreement, or for errors in judgment; PROVIDED, HOWEVER, that
this provision shall not protect the Trustee, its directors, officers, employees
or agents or any such Person against any liability which would otherwise be
imposed by reason of negligent action, negligent failure to act or willful
misconduct in the performance of duties or by reason of reckless disregard of
obligations and duties hereunder. Subject to the foregoing sentence, the Trustee
shall not be liable for losses on investments of amounts in the Certificate
Account (except for any losses on obligations on which the bank serving as the
Trustee is the obligor). In addition, the Depositor and the Trust covenant and
agree to indemnify the Trustee, and when the Trustee is acting as Servicer, the
Servicer, from, and hold it harmless against, any and all losses, liabilities,
damages, claims or expenses (including legal fees and expenses) of whatsoever
kind arising out of or in connection with the performance of its duties
hereunder other than those resulting from the negligence or bad faith of the
Trustee, and the Depositor shall pay all amounts not otherwise paid pursuant to
SECTIONS 6.12 and 7.06. The Trustee and any director, officer, employee or agent
of the Trustee may rely and shall be protected in acting or refraining from
acting in good faith on any certificate, notice or other document of any kind
prima facie properly executed and submitted by the Authorized Officer of any
Person respecting any matters arising hereunder. The provisions of this SECTION
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11.12 shall survive the termination of this Agreement, the termination or
resignation of the Trustee and the payment of the outstanding Certificates.
11.13 APPOINTMENT OF CO-TRUSTEE OR SEPARATE TRUSTEE.
----------------------------------------------
Notwithstanding any other provisions of this Agreement, at any time,
for the purpose of meeting any legal requirements of any jurisdiction in which
any part of the Trust Estate or Mortgaged Property may at the time be located,
the Depositor and the Trustee acting jointly shall have the power and shall
execute and deliver all instruments to appoint one or more Persons approved by
the Trustee and reasonably acceptable to the Depositor to act as co-Trustee or
co-Trustees, jointly with the Trustee, of all or any part of the Trust Estate or
separate Trustee or separate Trustees of any part of the Trust Estate, and to
vest in such Person or Persons, in such capacity and for the benefit of the
Owners, such title to the Trust Estate, or any part thereof, and, subject to the
other provisions of this SECTION 11.13, such powers, duties, obligations, rights
and trusts as the Depositor and the Trustee may consider necessary or desirable.
If the Depositor shall not have joined in such appointment within fifteen (15)
days after the receipt by it of a request so to do, or in the case any event
indicated in SECTION 8.17(B) shall have occurred and be continuing, the Trustee
subject to reasonable approval of the Depositor alone shall have the power to
make such appointment. No co-Trustee or separate Trustee hereunder shall be
required to meet the terms of eligibility as a successor trustee under SECTION
11.08 and no notice to Owners of the appointment of any co-Trustee or separate
Trustee shall be required under SECTION 11.09.
Every separate Trustee and co-Trustee shall, to the extent permitted,
be appointed and act subject to the following provisions and conditions:
(i) All rights, powers, duties and obligations conferred or
imposed upon the Trustee shall be conferred or imposed upon and
exercised or performed by the Trustee and such separate Trustee or
co-Trustee jointly (it being understood that such separate Trustee or
co-Trustee is not authorized to act separately without the Trustee
joining in such act), except to the extent that under any law of any
jurisdiction in which any particular act or acts are to be performed
(whether as Trustee hereunder or as successor to the Servicer
hereunder), the Trustee shall be incompetent or unqualified to perform
such act or acts, in which event such rights, powers, duties and
obligations (including the holding of title to the Trust Estate or any
portion thereof in any such jurisdiction) shall be exercised and
performed singly by such separate Trustee or co-Trustee, but solely at
the direction of the Trustee;
(ii) No co-Trustee hereunder shall be held personally liable by
reason of any act or omission of any other co-Trustee hereunder; and
(iii) The Servicer, the Depositor and the Trustee acting jointly
may at any time accept the resignation of or remove any separate
Trustee or co-Trustee.
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Any notice, request or other writing given to the Trustee
shall be deemed to have been given to each of the then separate Trustees and
co-Trustees, as effectively as if given to each of them. Every instrument
appointing any separate Trustee or co-Trustee shall refer to this Agreement and
the conditions of this SECTION 11.13. Each separate Trustee and co-Trustee, upon
its acceptance of the trusts conferred, shall be vested with the estates or
property specified in its instrument of appointment, either jointly with the
Trustee or separately, as may be provided therein, subject to all the provisions
of this Agreement, specifically including every provision of this Agreement
relating to the conduct of, affecting the liability of, or affording protection
to, the Trustee. Every such instrument shall be filed with the Trustee and a
copy thereof given to the Servicer.
Any separate Trustee or co-Trustee may, at any time,
constitute the Trustee, its agent or attorney-in-fact, with full power and
authority, to the extent not prohibited by law, to do any lawful act under or in
respect of this Agreement on its behalf and in its name. If any separate Trustee
or co-Trustee shall die, become incapable of acting, resign or be removed, all
of its estates, properties, rights, remedies and trusts shall vest in and be
exercised by the Trustee, to the extent permitted by law, without the
appointment of a new or successor Trustee.
ARTICLE XII
MISCELLANEOUS
12.01 COMPLIANCE CERTIFICATES AND OPINIONS.
-------------------------------------
Upon any application or request by the Depositor or the Owners to the
Trustee to take any action under any provision of this Agreement, the Depositor
or the Owners, as the case may be, shall furnish to the Trustee a certificate
stating that all conditions precedent, if any, provided for in this Agreement
relating to the proposed action have been complied with, except that in the case
of any such application or request as to which the furnishing of such documents
is specifically required by any provision of this Agreement relating to such
particular application or request, no additional certificate need be furnished.
Except as otherwise specifically provided herein, each certificate or
opinion with respect to compliance with a condition or covenant provided for in
this Agreement (including one furnished pursuant to specific requirements of
this Agreement relating to a particular application or request) shall include:
(a) a statement that each individual signing such certificate or
opinion has read such covenant or condition and the definitions herein
relating thereto;
(b) a brief statement as to the nature and scope of the
examination or investigation upon which the statements or opinions
contained in such certificate or opinion are based; and
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(c) a statement as to whether, in the opinion of each such
individual, such condition or covenant has been complied with.
12.02 FORM OF DOCUMENTS DELIVERED TO THE TRUSTEE.
-------------------------------------------
In any case where several matters are required to be certified by, or
covered by an opinion of, any specified Person, it is not necessary that all
such matters be certified by, or covered by the opinion of, only one such
Person, or that they be so certified or covered by only one document, but one
such Person may certify or give an opinion with respect to some matters and one
or more other such Persons as to other matters, and any such Person may certify
or give an opinion as to such matters in one or several documents.
Any certificate or opinion of an Authorized Officer of the Trustee may
be based, insofar as it relates to legal matters, upon a certificate or opinion
of, or representations by, counsel, unless such Authorized Officer knows that
the certificate or opinion or representations with respect to the matters upon
which his certificate or opinion is based are erroneous. Any such certificate or
opinion of an Authorized Officer of the Trustee or any opinion of counsel may be
based, insofar as it relates to factual matters upon a certificate or opinion
of, or representations by, one or more Authorized Officers of the Depositor or
the relevant Servicer, stating that the information with respect to such factual
matters is in the possession of the Depositor or the relevant Servicer, unless
such Authorized Officer or counsel knows that the certificate or opinion or
representations with respect to such matters are erroneous. Any opinion of
counsel may also be based, insofar as it relates to factual matters, upon a
certificate or opinion of, or representations by, an Authorized Officer of the
Trustee, stating that the information with respect to such matters is in the
possession of the Trustee, unless such counsel knows that the certificate or
opinion or representations with respect to such matters are erroneous. Any
opinion of counsel may be based on the written opinion of other counsel, in
which event such opinion of counsel shall be accompanied by a copy of such other
counsel's opinion and shall include a statement to the effect that such counsel
believes that such counsel and the Trustee may reasonably rely upon the opinion
of such other counsel.
Where any Person is required to make, give or execute two or more
applications, requests, consents, certificates, statements, opinions or other
instruments under this Agreement, they may, but need not, be consolidated and
form one instrument.
12.03 ACTS OF OWNERS.
---------------
(a) Any request, demand, authorization, direction, notice,
consent, waiver or other action provided by this Agreement to be given
or taken by the Owners, or the Certificate Insurer on behalf of the
Owners, may be embodied in and evidenced by one or more instruments of
substantially similar tenor signed by such Owners in person or by
agent duly appointed in writing; and, except as herein otherwise
expressly provided, such action shall become effective when such
instrument or instruments are delivered to the Trustee, and, where it
is
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hereby expressly required, to the Depositor. Such instrument or
instruments (and the action embodied therein and evidenced thereby)
are herein sometimes referred to as the "act" of the Owners signing
such instrument or instruments. Proof of execution of any such
instrument or of a writing appointing any such agent shall be
sufficient for any purpose of this Agreement and conclusive in favor
of the Trustee and the Trust, if made in the manner provided in this
SECTION.
(b) The fact and date of the execution by any Person of any such
instrument or writing may be proved by the affidavit of a witness of
such execution or by the certificate of any notary public or other
officer authorized by law to take acknowledgments of deeds, certifying
that the individual signing such instrument or writing acknowledged to
him the execution thereof. Whenever such execution is by an officer of
a corporation or a member of a partnership on behalf of such
corporation or partnership, such certificate or affidavit shall also
constitute sufficient proof of his authority.
(c) The ownership of Certificates shall be proved by the
Register.
(d) Any request, demand, authorization, direction, notice,
consent, waiver or other action by the holder of any Certificate shall
bind the holder of every Certificate issued upon the registration of
transfer thereof or in exchange therefor or in lieu thereof, in
respect of anything done, omitted or suffered to be done by the
Trustee or the Trust in reliance thereon, whether or not notation of
such action is made upon such Certificates.
12.04 NOTICES, ETC. TO TRUSTEE.
-------------------------
Any request, demand, authorization, direction, notice, consent, waiver
or act of the Owners or other documents provided or permitted by this Agreement
to be made upon, given or furnished to, or filed with the Trustee by any Owner
or the Depositor shall be sufficient for every purpose hereunder if made, given,
furnished or filed in writing to or with and received by the Trustee at the
Corporate Trust Office.
12.05 NOTICES AND REPORTS TO OWNERS; WAIVER OF NOTICES.
-------------------------------------------------
Where this Agreement provides for notice to Owners of any event or the
mailing of any report to Owners, such notice or report shall be sufficiently
given (unless otherwise herein expressly provided) if mailed, first-class
postage prepaid, to each Owner affected by such event or to whom such report is
required to be mailed, at the address of such Owner as it appears on the
Register, not later than the latest date, and not earlier than the earliest
date, prescribed for the giving of such notice or the mailing of such report. In
any case where a notice or report to Owners is mailed in the manner provided
above, neither the failure to mail such notice or report nor any defect in any
notice or report so mailed to any particular Owner shall affect the sufficiency
of such notice or report with respect to other Owners, and any notice or report
which is mailed in the manner herein provided shall be conclusively presumed to
have been duly given or provided. Notwithstanding the foregoing, if any Servicer
is removed or resigns or the
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Trust is terminated, notice of any such events shall be made by overnight
courier, registered mail or telecopy followed by a telephone call.
Where this Agreement provides for notice in any manner, such notice may
be waived in writing by any Person entitled to receive such notice, either
before or after the event, and such waiver shall be the equivalent of such
notice. Waivers of notice by Owner shall be filed with the Trustee, but such
filing shall not be a condition precedent to the validity of any action taken in
reliance upon such waiver.
In case, by reason of the suspension of regular mail service as a
result of a strike, work stoppage or similar activity, it shall be impractical
to mail notice of any event to Owners when such notice is required to be given
pursuant to any provision of this Agreement, then any manner of giving such
notice as shall be satisfactory to the Trustee shall be deemed to be a
sufficient giving of such notice.
Where this Agreement provides for notice to any Rating Agency that
rated any Certificates, failure to give such notice shall not affect any other
rights or obligations created hereunder.
12.06 RULES BY TRUSTEE.
-----------------
The Trustee may make reasonable rules for any meeting of Owners.
12.07 SUCCESSORS AND ASSIGNS.
-----------------------
All covenants and agreements in this Agreement by any party hereto
shall bind its successors and assigns, whether so expressed or not.
12.08 SEVERABILITY.
-------------
In case any provision in this Agreement or in the Certificates shall be
invalid, illegal or unenforceable, the validity, legality and enforceability of
the remaining provisions shall not in any way be affected or impaired thereby.
12.09 BENEFITS OF AGREEMENT.
----------------------
Nothing in this Agreement or in the Certificates, expressed or implied,
shall give to any Person, other than the Owners, the Depositor, the Underwriter,
the Certificate Insurer and the parties hereto and their successors hereunder,
any benefit or any legal or equitable right, remedy or claim under this
Agreement. The Certificate Insurer is hereby deemed to be a third party
beneficiary of this Agreement.
12.10 LEGAL HOLIDAYS.
---------------
In any case where the date of any Distribution Date, any other date on
which any distribution to any Owner is proposed to be paid, or any date on which
a notice is required to be sent to any Person pursuant to the terms of this
Agreement shall not be a Business Day, then (notwithstanding any other provision
of the Certificates or this
148
Agreement) payment or mailing need not be made on such date, but may be made on
the next succeeding Business Day with the same force and effect as if made or
mailed on the nominal date of any such Remittance Date, such Distribution Date,
or such other date for the payment of any distribution to any Owner or the
mailing of such notice, as the case may be, and no interest shall accrue for the
period from and after any such nominal date, provided such payment is made in
full on such next succeeding Business Day.
12.11 GOVERNING LAW; SUBMISSION TO JURISDICTION.
------------------------------------------
(a) In view of the fact that Owners are expected to reside in
many states and outside the United States and the desire to establish
with certainty that this Agreement will be governed by and construed
and interpreted in accordance with the law of a state having a
well-developed body of commercial and financial law relevant to
transactions of the type contemplated herein, this Agreement and each
Certificate shall be construed in accordance with and governed by the
law of the State of New York.
(b) The parties hereto hereby irrevocably submit to the
jurisdiction of the United States District Court for the Southern
District of New York and any court of the State of New York located in
the City and County of New York, and any appellate court from any
thereof, in any action, suit or proceeding brought against it or in
connection with this Agreement or any of the related documents or the
transactions contemplated hereunder or for recognition or enforcement
of any judgment, and the parties hereto hereby irrevocably and
unconditionally agree that all claims in respect of any such action or
proceeding may be heard or determined in such New York State court or,
to the extent permitted by law, in such federal court. The parties
hereto agree that a final judgment in any such action, suit or
proceeding shall be conclusive and may be enforced in other
jurisdictions by suit on the judgment or in any other manner provided
by law. To the extent permitted by applicable law, the parties hereto
hereby waive and agree not to assert by way of motion, as a defense or
otherwise in any such suit, action or proceeding, any claim that it is
not personally subject to the jurisdiction of such courts, that the
suit, action or proceeding is brought in an inconvenient forum, that
the venue of the suit, action or proceeding is improper or that the
related documents or the subject matter thereof may not be litigated
in or by such courts.
(c) Nothing contained in this Agreement shall limit or affect the
right of the Depositor or any Servicer or any third-party beneficiary
hereunder, as the case may be, to serve process in any other manner
permitted by law or to start legal proceedings relating to any of the
Mortgage Loans against any Mortgagor in the courts of any
jurisdiction.
12.12 COUNTERPARTS.
-------------
This instrument may be executed in any number of counterparts,
each of which so executed shall be deemed to be an original, but all such
counterparts shall together constitute but one and the same instrument.
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12.13 [RESERVED].
-----------
12.14 AMENDMENT.
----------
(a) The Trustee, the Depositor and the affected Servicer may, at
any time and from time to time, and without notice to or the consent
of the Owners, but with the prior written consent of the Certificate
Insurer (unless a Certificate Insurer Default has occurred and is
continuing), amend this Agreement, subject to the provisions of
SECTIONS 12.16 and 12.17 for the purpose of (i) curing any ambiguity,
correcting or supplementing any provision hereof which may be
inconsistent with any other provision hereof, or adding provisions
hereto which are not inconsistent with the provisions hereof; (ii)
complying with the requirements of the Code and the regulations
proposed or promulgated thereunder including any amendments necessary
to maintain REMIC status (iii) to correct, modify or supplement any
provision contained in this Agreement which is inconsistent with any
offering document used to sell the Offered Certificates, PROVIDED that
such correction, modification or supplement made pursuant to this
clause is consistent with such offering document; or (iv) for any
other purpose, PROVIDED that in the case of this clause (iv) such
amendment shall not adversely affect in any material respect any
Owner. Any such amendment shall be deemed not to adversely affect in
any material respect any Owner if there is delivered to the Trustee
written notification from each Rating Agency that such amendment will
not cause such Rating Agency to reduce, qualify or withdraw its then
current rating assigned to any of the Class A Certificates, the Class
M-1 Certificates or the Class B Certificates. Notwithstanding anything
to the contrary herein, no such amendment shall change in any manner
the amount of, or change the timing of, payments which are required to
be distributed to any Holder of a Certificate without the consent of
the Holder of each such Certificate. Without limiting the generality
of the foregoing, any amendment to this Agreement required in
connection with the compliance with or the clarification of any
reporting obligations described in Section 8.22 hereof shall not
require the consent of any Certificateholder or the Certificate
Insurer, any Opinion of Counsel or Rating Agency confirmation.
(b) Promptly after the execution of any such amendment, the
Trustee shall furnish written notification of the substance of such
amendment to the Depositor and each Owner in the manner set forth in
SECTION 12.05, and to the Rating Agencies.
(c) The Rating Agencies and the Certificate Insurer shall be
provided with copies of any amendments to this Agreement, together
with copies of any opinions or other documents or instruments executed
in connection therewith.
(d) Prior to consenting to any amendment pursuant to this SECTION
12.14 the Trustee shall be entitled to receive and rely upon an
opinion of counsel addressed to the Trustee from the party requesting
such amendment stating that
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such amendment is authorized and permitted pursuant to this Agreement
and a REMIC Opinion addressed to the Trustee and stating that such
amendment shall not cause either REMIC to fail to qualify as a REMIC.
12.15 PAYING AGENT; APPOINTMENT AND ACCEPTANCE OF DUTIES.
---------------------------------------------------
The Trustee is hereby appointed Paying Agent. The Depositor may,
subject to the eligibility requirements for the Trustee set forth in SECTION
11.08, appoint one or more other Paying Agents or successor Paying Agents, which
successor Paying Agent shall be reasonably satisfactory to the Certificate
Insurer.
Each Paying Agent, immediately upon such appointment, shall signify its
acceptance of the duties and obligations imposed upon it by this Agreement by
written instrument of acceptance deposited with the Trustee.
Each such Paying Agent other than the Trustee shall execute and deliver
to the Trustee an instrument in which such Paying Agent shall agree with the
Trustee, subject to the provisions of SECTION 6.02, that such Paying Agent will:
(a) allocate all sums received for distribution to the Owners of
Certificates of each Class for which it is acting as Paying Agent on
each Distribution Date among such Owners in the proportion specified
by the Trustee; and
(b) hold all sums held by it for the distribution of amounts due
with respect to the Certificates in trust for the benefit of the
Owners entitled thereto until such sums shall be paid to such Owners
or otherwise disposed of as herein provided and pay such sums to such
Persons as herein provided.
Any Paying Agent other than the Trustee may at any time resign and be
discharged of the duties and obligations created by this Agreement by giving at
least sixty (60) days written notice to the Trustee. Any such Paying Agent may
be removed at any time by an instrument filed with such Paying Agent and signed
by the Trustee.
In the event of the resignation or removal of any Paying Agent other
than the Trustee, such Paying Agent shall pay over, assign and deliver any
moneys held by it as Paying Agent to its successor, or if there be no successor,
to the Trustee.
Upon the appointment, removal or notice of resignation of any Paying
Agent, the Trustee shall notify the Certificate Insurer, the Depositor and the
Owners by mailing notice thereof at their addresses appearing on the Register.
12.16 REMIC STATUS.
-------------
(a) The parties hereto intend that each REMIC shall constitute,
and that the affairs of each REMIC shall be conducted so as to qualify
it as a REMIC in accordance with the REMIC Provisions. In furtherance
of such intention, the
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Trustee shall, to the extent permitted by applicable law, act as agent
for each Trust REMIC and in such capacity it shall: (i) prepare or
cause to be prepared and filed, in a timely manner, annual tax returns
and any other tax return required to be filed by each Trust REMIC
established hereunder using a calendar year as the taxable year for
each Trust REMIC established hereunder; (ii) in the related first such
tax return, make (or cause to be made) an election satisfying the
requirements of the REMIC Provisions, on behalf of each Trust REMIC,
for it to be treated as a REMIC; (iii) prepare and forward, or cause
to be prepared and forwarded, to the Owners all information, reports
or tax returns required with respect to each Trust REMIC as, when and
in the form required to be provided to the Owners, and to the Internal
Revenue Service and any other relevant governmental taxing authority
in accordance with the REMIC Provisions and any other applicable
federal, state or local laws, including without limitation information
as necessary in respect of the determination of the present value of
anticipated excess inclusions as required under Treasury Regulation
Section 1.860E-2(a)(6) and reports relating to "original issue
discount" as defined in the Code based upon the prepayment assumption
and calculated by using the "issue price" (within the meaning of
Section 1273 of the Code) of the Certificates of the related Class;
(iv) if the filing or distribution of any documents of an
administrative nature not addressed in clauses (i) through (iii) of
this SECTION 12.16(A) is then required by the REMIC Provisions in
order to maintain the status of REMIC II and REMIC I as a REMIC or is
otherwise required by the Code, prepare, sign and file or distribute,
or cause to be prepared and signed and filed or distributed, such
documents with or to such Persons when and as required by the REMIC
Provisions or the Code or comparable provisions of applicable state or
local tax law; (v) within thirty days of the Closing Date, furnish or
cause to be furnished to the Internal Revenue Service, on Form 8811 or
as otherwise may be required by the Code, the name, title and address
of the Person that the Owners of the Certificates may contact for tax
information relating thereto (and the Trustee shall act as the
representative of each of REMIC II and REMIC I for this purpose),
together with such additional information as may be required by such
Form, and shall update such information at the time or times and in
the manner required by the Code (and the Depositor agrees within 10
Business Days of the Closing Date to provide any information
reasonably requested by the Servicer or the Trustee and necessary to
make such filing); (vi) maintain such records relating to each of
REMIC II and REMIC I as may be necessary to prepare the foregoing
returns, schedules, statements or information, such records, for
federal income tax purposes, to be maintained on a calendar year and
on an accrual basis; (vii) represent the Trust or a REMIC in any
administrative or judicial proceedings relating to an examination or
audit by any governmental taxing authority, request an administrative
adjustment as to a taxable year of the Trust or a Trust REMIC, enter
into settlement agreements with any governmental taxing agency, extend
any statute of limitations relating to any tax item of the Trust or a
Trust REMIC, and otherwise act on behalf of the Trust or a Trust REMIC
therein in relation to any tax matter involving the Trust or the Trust
REMIC therein; (viii) comply with all statutory or regulatory
requirements with regard to its conduct of activities
152
pursuant to the foregoing clauses of this SECTION 12.16, including,
without limitation, providing all notices and other information to the
Internal Revenue Service and Owners of Residual Certificates required
of a "tax matters person" pursuant to subtitle F of the Code and the
Treasury Regulations thereunder; and (ix) make available information
necessary for the computation of any tax imposed (A) on transferors of
residual interests to certain Disqualified Organizations or (B) on
pass-through entities, any interest in which is held by or treated as
held by a Disqualified Organization. The obligations of the Trustee or
such other agent designated by the Tax Matters Person pursuant to this
SECTION 12.16 shall survive the termination or discharge of this
Agreement.
The Depositor, the Trustee, Fairbanks, GreenPoint and Wilshire each
covenant and agree that each shall not intentionally take any action or
intentionally omit to take any action if, in taking or omitting to take such
action, the Trustee knows that such action or omission (as the case may be)
would cause the termination of the REMIC status of REMIC II or REMIC I or the
imposition of tax on REMIC II or REMIC I or any other portions of the Trust
(other than a tax on income expressly permitted or contemplated to be received
by the terms of this Agreement). The Depositor and Trustee further each covenant
and agree to cause the Servicers not to take or engage in any such action or
omission described in the preceding sentence to the extent the Depositor and/or
the Trustee are aware of any such proposed action or omission by any Servicer.
Notwithstanding any provision of this paragraph to the contrary, the Trustee
shall not be required to take any action that the Trustee in good faith believes
to be inconsistent with any other provision of this Agreement, nor shall the
Trustee be deemed in violation of this paragraph if it takes any action
expressly required or authorized by any other provision of this Agreement, and
the Trustee shall have no responsibility or liability with respect to any act or
omission of the Depositor or a Servicer which does not enable the Trustee to
comply with any of CLAUSES (i) through (VI) of the second sentence of the first
paragraph of this SECTION 12.16(A) or which results in any action contemplated
by CLAUSES (I) through (III) of the next succeeding sentence. In this regard the
Depositor, the Trustee, Fairbanks, GreenPoint and Wilshire each covenant and
agree that each shall (i) exercise reasonable care not to allow the occurrence
of any "prohibited transactions" within the meaning of Code Section 860F(a),
unless the party seeking such action shall have delivered to the Trustee an
REMIC Opinion addressed to the Trustee (at such party's expense) that such
occurrence would not (A) result in a taxable gain, (B) otherwise subject REMIC
II or REMIC I to tax (other than a tax at the highest marginal corporate tax
rate on net income from foreclosure property), or (C) cause either REMIC II or
REMIC I to fail to qualify as a REMIC; and (ii) exercise reasonable care not to
allow the Trust to receive income from the performance of services or from
assets not permitted under the REMIC Provisions to be held by a REMIC (provided,
however, that the receipt of any income expressly permitted or contemplated by
the terms of this Agreement shall not be deemed to violate this clause) and
(iii) not permit the creation of any "interests," within the meaning of the
REMIC Provisions, in REMIC II other than the REMIC Regular Interests and the
Class R-1 Interest or in REMIC I other than the REMIC I Regular Interests or the
Class R Certificate. None of Fairbanks Wilshire or the Depositor shall be
responsible or liable for any failure by the Trustee to comply with the
provisions
153
of this SECTION 12.16. The Depositor, Fairbanks and Wilshire shall cooperate in
a timely manner with the Trustee in supplying any information within the
Depositor's or such Servicer's control (other than any confidential information)
that is reasonably necessary to enable the Trustee to perform its duties under
this SECTION 12.16.
(b) Each Trust REMIC shall, for federal income tax purposes,
maintain books on a calendar year basis and report income on an
accrual basis.
(c) Except as otherwise permitted by SECTION 7.04, no Eligible
Investment shall be sold prior to its stated maturity (unless sold
pursuant to a plan of liquidation in accordance with ARTICLE X).
(d) Neither the Depositor nor the Trustee shall enter into any
arrangement by which the Trustee will receive a fee or other
compensation for services rendered pursuant to this Agreement, other
than as expressly contemplated by this Agreement.
(e) Notwithstanding the foregoing SECTIONS 12.16(C) and (D), the
Trustee shall not engage in any of the transactions prohibited by such
clauses, unless the Trustee shall have received a REMIC Opinion
addressed to the Trustee (and in no event at the Trustee's expense) to
the effect that such transaction does not result in a tax imposed on
the Trust or cause a termination of REMIC status for a Trust REMIC;
PROVIDED, HOWEVER, that such transaction is otherwise permitted under
this Agreement.
(f) Each of Fairbanks, Wilshire and the Tax Matters Person agree
to indemnify the Trust for any tax imposed on the Trust or a Trust
REMIC as a result of their negligence.
12.17 ADDITIONAL LIMITATION ON ACTION AND IMPOSITION OF TAX ON THE TRUST REMICS.
--------------------------------------------------------------------------
Any provision of this Agreement to the contrary notwithstanding, the
Trustee shall not, without having obtained a REMIC Opinion to the effect that
such transaction does not result in a tax imposed on the Trust or a Trust REMIC
or cause a termination of REMIC status for a Trust REMIC, (i) sell any assets in
the Trust Estate, (ii) accept any contribution of assets after the Closing Date
or (iii) agree to any modification of this Agreement. Any taxes imposed on any
net income from foreclosure property pursuant to Code Section 860G(d) or any
similar tax imposed by a state or local jurisdiction shall instead be treated as
an expense of the related Liquidated Loan in determining Net Liquidation
Proceeds with respect to the Liquidated Loan (and until such taxes are paid, the
relevant Servicer from time to time shall withdraw from the related Collection
Account and transfer to the Trustee amounts reasonably determined by the Trustee
to be necessary to pay such taxes, which the Trustee shall maintain in a
separate, non-interest-bearing account, and the Trustee shall deposit in the
related Collection Account the excess determined by the Trustee from time to
time of the amount in such account over the amount necessary to pay such taxes)
and shall be paid therefrom;
154
PROVIDED that any such tax imposed on net income from foreclosure property that
exceeds the amount in any such reserve shall be retained from available funds as
provided in SECTION 8.04(C) and the next sentence. Except as provided in the
preceding sentence, the Trustee is hereby authorized to and shall retain or
cause to be retained from the related Collection Account in determining the
amount of available funds sufficient funds to pay or provide for the payment of,
and to actually pay, such tax as is legally owed by REMIC II or REMIC I (but
such authorization shall not prevent the Trustee from contesting, at the expense
of the Trust, any such tax in appropriate proceedings, and withholding payment
of such tax, if permitted by law, pending the outcome of such proceedings). To
the extent that sufficient amounts cannot be so retained to pay or provide for
the payment of any tax, including interest, penalties or assessments, additional
amounts or additions to tax, the Trustee is hereby authorized to and shall
segregate, into a separate non-interest bearing account, the net income from any
such Prohibited Transactions of a Trust REMIC and use such income, to the extent
necessary, to pay such tax (and return the balance thereof, if any, to the REMIC
I Distribution Account or the REMIC II Distribution Account, as the case may
be); PROVIDED that, to the extent that any such income is paid to the Internal
Revenue Service, the Trustee shall retain from future amounts otherwise
distributable to the Owners of the Class R Certificates and shall distribute
such retained amounts to the Owners of Offered Certificates to the extent they
are fully reimbursed and then to the Owners of the Class R Certificates. If any
tax, including interest penalties or assessments, additional amounts or
additions to tax, is imposed on the Trust, such tax shall be charged against
amounts otherwise distributable to the owners of the Class R Certificates. None
of Fairbanks, Wilshire or the Trustee shall be responsible for any taxes imposed
on REMIC II or REMIC I except to the extent in either case that such tax is
attributable to a breach of a representation or warranty of the relevant
Servicer or the Trustee or an act or omission of the relevant Servicer or the
Trustee in contravention of this Agreement. Notwithstanding anything in this
Agreement to the contrary, in each such case, neither Fairbanks nor Wilshire
shall be responsible for the Trustee's breaches, acts or omissions, and the
Trustee shall not be responsible for the breaches, acts or omissions of
Fairbanks or Wilshire.
12.18 TAX MATTERS PERSON.
-------------------
The Holders of the Class R Certificates shall be the Tax Matters Person
of REMIC II and REMIC I, respectively, pursuant to Treasury Regulations Section
1.860F-4(d). The Trustee shall act as attorney-in-fact and agent for the Tax
Matters Person of each of REMIC II and REMIC I, and each Holder of the Class R
Certificate, by acceptance thereof, is deemed to have consented to the Trustee's
appointment in such capacity and agrees to execute any documents required to
give effect thereto, and any fees and expenses incurred by the Trustee in
connection with any audit or administrative or judicial proceeding shall be paid
by the Trust Estate.
12.19 NOTICES.
--------
All notices hereunder shall be given as follows, until any superseding
instructions are given to all other Persons listed below:
155
Trustee: JPMorgan Chase Bank
▇ ▇▇▇ ▇▇▇▇ ▇▇▇▇▇
▇▇▇ ▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇ ▇▇▇▇▇
Attention: Institutional Trust Services/Structured
Finance Services, GSRPM 2003-1
Fax: (▇▇▇) ▇▇▇-▇▇▇▇
Depositor: ▇▇▇▇▇▇▇ ▇▇▇▇▇ Mortgage Securities Corp.,
▇▇▇ ▇▇▇ ▇▇▇▇ ▇▇▇▇▇, ▇▇▇▇ ▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇ ▇▇▇▇▇
Attention: Legal Department
Tel: (▇▇▇) ▇▇▇-▇▇▇▇
Fax: (▇▇▇) ▇▇▇-▇▇▇▇
Fairbanks: Fairbanks Capital Corp.
3815 South West Temple
▇.▇. ▇▇▇ ▇▇▇▇▇
▇▇▇▇ ▇▇▇▇ ▇▇▇▇, ▇▇▇▇ ▇▇▇▇▇-▇▇▇▇
Attention: General Counsel
Tel: (▇▇▇) ▇▇▇-▇▇▇▇
Fax: (▇▇▇) ▇▇▇-▇▇▇▇
Wilshire: Wilshire Credit Corporation
▇▇▇▇▇ ▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇
▇▇▇▇▇ ▇▇▇
▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇ ▇▇▇▇▇
Attention:▇▇▇ Mammott
Tel: (▇▇▇) ▇▇▇-▇▇▇▇
Fax: (▇▇▇) ▇▇▇-▇▇▇▇
Standard & Poor's: Standard & Poor's Ratings Group
▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇ ▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇
Attention: Residential Mortgage Surveillance Group
Tel: (▇▇▇) ▇▇▇-▇▇▇▇
Fax: (▇▇▇) ▇▇▇-▇▇▇▇
Moody's ▇▇▇▇▇'▇ Investor Service, Inc.
▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇
Attention: The Mortgage Monitoring Department
Tel: (▇▇▇) ▇▇▇-▇▇▇▇
Fax: (▇▇▇) ▇▇▇-▇▇▇▇
Underwriter: ▇▇▇▇▇▇▇ ▇▇▇▇▇ & Co.
▇▇▇
▇▇▇ ▇▇▇ ▇▇▇▇ ▇▇▇▇▇
▇▇▇▇ ▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇ ▇▇▇▇▇
Attention: Legal Department
Tel: (▇▇▇) ▇▇▇-▇▇▇▇
Fax: (▇▇▇) ▇▇▇-▇▇▇▇
Certificate Insurer: Ambac Assurance Corporation
▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇
Attention: Consumer Asset-Backed Securities Group
Section 12.20 RIGHTS OF THE CERTIFICATE INSURER.
----------------------------------
(a) The Certificate Insurer is an express third-party beneficiary
of this Agreement.
(b) The Trustee shall provide to the Certificate Insurer copies
of any report, notice, Opinion of Counsel, Officers' Certificate,
request for consent or request for amendment to any document related
hereto promptly upon the Trustee's production or receipt thereof.
(c) Unless a Certificate Insurer Default exists, the Trustee,
each of the Servicers and the Depositor shall not agree to any
amendment to this Agreement without first having obtained the prior
written consent of the Certificate Insurer.
(d) So long as there does not exist a failure by the Certificate
Insurer to make a required payment under the Certificate Insurance
Policy, if any, the Certificate Insurer shall have the right to
exercise all rights of the Owners of the Class A Certificates under
this Agreement without any consent of such Owners, and such Owners may
exercise such rights only with the prior written consent of the
Certificate Insurer, except as provided herein.
(e) Unless a Certificate Insurer Default exists and is
continuing, the Trustee, the Depositor and the Servicers shall
cooperate in all respects with any reasonable request by the
Certificate Insurer for action to preserve or enforce the Certificate
Insurer's rights or interests hereunder without limiting the rights or
affecting the interests of the Certificateholders as otherwise set
forth herein.
(f) The Trustee hereby agrees to provide to the Certificate
Insurer prompt written notice of any action, proceeding or
investigation that names the Trust or the Trustee as a party or that
could adversely affect the Trust, the Trust Estate or the rights or
obligations of the Certificate Insurer hereunder or under the Policy
or the Operative Documents, including (without limitation) any
insolvency or bankruptcy
157
proceeding in respect of any the Sellers, the Servicers or the
Depositor, or any Affiliate thereof.
(g) Notwithstanding anything contained herein or in any of the
other Operative Documents to the contrary (other than at any time
during which a Certificate Insurer Default exists or is continuing),
the Trustee shall not, without the Certificate Insurer's prior written
consent or unless directed by the Certificate Insurer, undertake or
join any litigation or agree to any settlement of any action,
proceeding or investigation affecting the Trust, the Trust Estate or
the rights or obligations of the Certificate Insurer hereunder or
under the Certificate Insurance Policy or the Operative Documents.
(h) The Certificate Insurer shall not be entitled to exercise any
of its rights hereunder so long as a Certificate Insurer Default has
occurred and is continuing.
158
IN WITNESS WHEREOF, the parties hereto have caused this
Agreement to be duly executed by their respective officers thereunto duly
authorized, all as of the day and year first above written.
GS MORTGAGE SECURITIES CORP.,
as Depositor
By:
-----------------------------
Name:
Title:
FAIRBANKS CAPITAL CORP.,
as a Servicer
By:
-----------------------------
Name:
Title:
WILSHIRE CREDIT CORPORATION,
as a Servicer and Master Servicer
By:
-----------------------------
Name:
Title:
JPMORGAN CHASE BANK,
as Trustee
By:
-----------------------------
Name:
Title:
SCHEDULE I
SCHEDULE OF MORTGAGE LOANS
[This Schedule is maintained by the Trustee at the Corporate Trust Office.]
SI-1
EXHIBIT A-1
[FORM OF OFFERED CERTIFICATE]
GSRPM MORTGAGE PASS-THROUGH CERTIFICATES,
SERIES 2003-1, CLASS
[THIS CERTIFICATE IS SUBORDINATED IN RIGHT OF DISTRIBUTION TO CERTAIN CLASSES OF
THE CERTIFICATES AS SET FORTH HEREIN AND IN THE TRUST AND SERVICING AGREEMENT
REFERRED TO HEREIN.] 1
[UNLESS THIS CERTIFICATE IS PRESENTED BY AN AUTHORIZED REPRESENTATIVE OF THE
DEPOSITORY TRUST COMPANY, A NEW YORK CORPORATION ("DTC"), TO THE CERTIFICATE
REGISTRAR FOR REGISTRATION OF TRANSFER, EXCHANGE, OR PAYMENT, AND ANY
CERTIFICATE ISSUED IS REGISTERED IN THE NAME OF CEDE & CO. OR IN SUCH OTHER NAME
AS IS REQUESTED BY AN AUTHORIZED REPRESENTATIVE OF DTC (AND ANY PAYMENT IS MADE
TO CEDE & CO. OR TO SUCH OTHER ENTITY AS IS REQUESTED BY AN AUTHORIZED
REPRESENTATIVE OF DTC), ANY TRANSFER, PLEDGE, OR OTHER USE HEREOF FOR VALUE OR
OTHERWISE BY OR TO ANY PERSON IS WRONGFUL INASMUCH AS THE REGISTERED OWNER
HEREOF, CEDE & CO., HAS AN INTEREST HEREIN.
TRANSFERS OF THIS GLOBAL CERTIFICATE SHALL BE LIMITED TO TRANSFERS IN WHOLE, BUT
NOT IN PART, TO NOMINEES OF DTC OR A SUCCESSOR THEREOF OR SUCH SUCCESSOR'S
NOMINEE, AND TRANSFERS OF BENEFICIAL INTERESTS IN THIS GLOBAL CERTIFICATE SHALL
BE LIMITED TO TRANSFERS MADE IN ACCORDANCE WITH THE RESTRICTIONS SET FORTH IN
THE TRUST AND SERVICING AGREEMENT REFERRED TO BELOW.] 2
THIS CERTIFICATE DOES NOT REPRESENT AN INTEREST IN OR OBLIGATION OF THE
DEPOSITOR, THE SERVICERS, THE TRUSTEE OR ANY OF THEIR RESPECTIVE AFFILIATES.
NEITHER THE CERTIFICATES NOR THE UNDERLYING MORTGAGE LOAN IS INSURED OR
GUARANTEED BY ANY GOVERNMENTAL AGENCY OR INSTRUMENTALITY.
PRINCIPAL PAYMENTS IN RESPECT OF THIS CERTIFICATE ARE DISTRIBUTABLE AS SET FORTH
IN THE TRUST AND SERVICING AGREEMENT. ACCORDINGLY, THE OUTSTANDING CERTIFICATE
----------------------
1 Include in Class M-1 and Class B Certificates.
2 Include in Global Certificate.
A1-1
BALANCE OF THIS CERTIFICATE AT ANY TIME MAY BE LESS THAN THE INITIAL CERTIFICATE
BALANCE SET FORTH BELOW.
SOLELY FOR U.S. FEDERAL INCOME TAX PURPOSES, THIS CERTIFICATE REPRESENTS A
"REGULAR INTEREST" IN A "REAL ESTATE MORTGAGE INVESTMENT CONDUIT," AS THOSE
TERMS ARE DEFINED, RESPECTIVELY, IN SECTIONS 860G(A)(1) AND 860D OF THE INTERNAL
REVENUE CODE OF 1986, AS AMENDED.
[THIS CERTIFICATE MAY NOT BE PURCHASED BY OR PLEDGED, SOLD OR OTHERWISE
TRANSFERRED TO ANY PERSON THAT IS OR BECOMES AN EMPLOYEE BENEFIT PLAN OR OTHER
PLAN OR ENTITY THAT IS SUBJECT TO THE EMPLOYEE RETIREMENT INCOME SECURITY ACT OF
1974, AS AMENDED ("ERISA"), OR TO SECTION 4975 OF THE INTERNAL REVENUE CODE OF
1986, AS AMENDED (THE "CODE"), OR ANY PERSON ACTING ON BEHALF OF ANY SUCH PLAN
OR USING THE ASSETS OF SUCH PLAN TO ACQUIRE THIS CERTIFICATE, UNLESS THE
PURCHASER IS AN INSURANCE COMPANY THAT IS PURCHASING THE CERTIFICATE WITH FUNDS
CONTAINED IN AN "INSURANCE COMPANY GENERAL ACCOUNT" (AS SUCH TERM IS DEFINED IN
SECTION V(E) OF PROHIBITED TRANSACTION CLASS EXEMPTION 95-60 ("PTCE 95-60") AND
THAT THE CONDITIONS OF SECTIONS I AND III OF PTCE 95-60 HAVE BEEN SATISFIED]
----------------
3 Include in Class M-1 and Class B Certificates.
A1-2
GSRPM MORTGAGE PASS-THROUGH CERTIFICATES,
SERIES 2003-1, CLASS
Pass-Through Rate: Before Clean-Up Call Date: [LIBOR +]o %
After Clean-Up Call Date: [LIBOR +]o %
First Distribution Date: February 25, 2003 Cut-off Date: January 1, 2003
Aggregate Initial Certificate Balance of the
Class Certificates: $. (4) Rated Final Distribution Date: January 2032
CUSIP:
Initial Certificate Balance of this Certificate: $.
No.: .
This certifies that _________ is the registered owner of a
beneficial ownership interest in a Trust, including the distributions to be made
with respect to the Class o Certificates. The Trust consists primarily of
Mortgage Loans secured by certain residential second liens and certain other
property held in trust by the Trustee. The Trust was created, and the Mortgage
Loans are to be serviced or master serviced pursuant to the Trust and Servicing
Agreement, dated as of January 1, 2003 (the "TRUST AND SERVICING AGREEMENT"),
among GS Mortgage Securities Corp., as Depositor, Fairbanks Capital Corp., as a
Servicer, Wilshire Credit Corporation, as a Servicer and as Master Servicer and
JPMorgan Chase Bank, as Trustee. The Holder of this Certificate, by virtue of
the acceptance hereof, assents to the terms, provisions and conditions of the
Trust and Servicing Agreement and is bound thereby. Also issued under the Trust
and Servicing Agreement are the [Class A, Class M-1, Class B-1, Class B-2, Class
B-3, Class X, Class P and Class R]5 Certificates (together with the Class o
Certificates, the "CERTIFICATES"; the Holders of Certificates issued under the
Trust and Servicing Agreement are collectively referred to herein as
"CERTIFICATEHOLDERS").
This Certificate is issued pursuant to, and in accordance
with, the terms of the Trust and Servicing Agreement. To the extent not defined
herein, capitalized terms used herein shall have the meanings assigned thereto
in the Trust and Servicing Agreement.
Pursuant to the terms of the Trust and Servicing Agreement,
the Trustee, or the Paying Agent on behalf of the Trustee, will distribute
(other than the final
----------------
4 Insert appropriate amount, as set forth in Section 2.10(b).
5 Omit Class of which Certificate is a part.
A1-3
distribution on any Certificate), on the 25th day of each calendar month, or if
such day is not a Business Day, the next succeeding Business Day, commencing
February 25, 2003 (each such date, a "DISTRIBUTION DATE"), to the Person in
whose name this Certificate is registered as of the related Record Date, which
will be the close of business on the Business Day immediately preceding such
Distribution Date, an amount equal to such Person's pro rata share (based on the
Percentage Interest represented by this Certificate) of that portion of the
aggregate amount of principal and interest then distributable, if any, allocable
to the Class o Certificates for such Distribution Date, all as more fully
described in the Trust and Servicing Agreement.
All distributions (other than the final distribution on any
Certificate) will be made to the Persons entitled thereto by wire transfer of
immediately available funds to the account of such Certificateholder at a bank
or other entity located in the United States and having appropriate facilities
therefor. The final distribution on each Certificate shall be made in like
manner, but only upon presentment and surrender of such Certificate at the
Corporate Trust Office of the Trustee or its agent (which may be the Paying
Agent or the Certificate Registrar acting as such agent) that is specified in
the notice to Certificateholders of such final distribution.
This Certificate is limited in right of payment to, among
other things, certain collections and recoveries in respect of the Mortgage
Loans, as more specifically set forth herein and in the Trust and Servicing
Agreement.
[As provided in the Trust and Servicing Agreement and with
certain exceptions therein provided, certain losses on the Mortgage Loans
resulting from defaults by Mortgagors will be borne by the Holders of Class M-1,
Class B-1, Class B-2 and Class X Certificates before such losses will be borne
by the Holders of the others classes of Certificates.]6
[This Certificate may not be purchased by or pledged, sold or
otherwise transferred to any person that is or becomes an employee benefit plan
or other plan or entity that is subject to ERISA, or to Section 4975 of the
Code, or any person acting on behalf of any such plan or using the assets of
such plan to acquire this Certificate, unless such purchaser is an insurance
company that is purchasing the Certificate with funds contained in an "insurance
company general account" (as such term is defined in Section V(e) of PTCE 95-60
and that the conditions of Sections I and III of PTCE 95-60 have been
satisfied.] 7
This Certificate does not purport to summarize the Trust and
Servicing Agreement, and reference is made to the Trust and Servicing Agreement
for the interests, rights, benefits, obligations and duties evidenced hereby,
and the limitations thereon, and the rights, duties and immunities of the
Trustee.
----------------
6 Insert for Class M-1, Class B-1, Class B-2 and Class B-3 Certificates.
7 Insert for Class M-1, Class B-1, Class B-2 and Class B-3 Certificates.
A1-4
As provided in the Trust and Servicing Agreement, subject to
certain restrictions on transfer set forth therein, upon surrender for
registration of transfer of any Certificate, the Certificate Registrar shall
execute, authenticate and deliver, in the name of the designated transferee or
transferees, one or more new Certificates in authorized denominations, in like
aggregate interest and of the same Class.
Prior to due presentation of this Certificate for registration
of transfer, the Trustee, the Servicers, the Certificate Registrar, and any
agent of the Trustee, the Servicers or the Certificate Registrar may treat the
Person in whose name any Certificate is registered as the owner of such
Certificate for the purpose of receiving distributions as provided in the Trust
and Servicing Agreement and for all other purposes whatsoever, and neither the
Trustee, the Servicers, the Certificate Registrar, nor any agent of the Trustee,
the Servicers or the Certificate Registrar shall be affected by any notice to
the contrary.
The Trust and Servicing Agreement may be amended from time to
time by the Depositor, the affected Servicer and the Trustee, without the
consent of any of the Certificateholders, in certain circumstances specified in
the Trust and Servicing Agreement.
The Trust and Servicing Agreement provides that the respective
obligations and responsibilities of Fairbanks, Wilshire, the Depositor, the
Paying Agent and the Trustee created thereby with respect to the Certificates
(other than the obligation of the Paying Agent to make certain payments to
Certificateholders after the final Distribution Date and other than the
indemnification obligations of the parties hereto) shall terminate upon the last
action required to be taken by the Paying Agent on the final Distribution Date
pursuant to Article X of the Trust and Servicing Agreement upon the later of (a)
the final payment or other liquidation (or any advance made with respect
thereto) of the last Mortgage Loan in the Trust Estate, (b) the disposition of
all property acquired in respect of any Mortgage Loan remaining in the Trust
Estate, and (c) at any time when a Qualified Liquidation of the Mortgage Loans
included within the Trust is effected.
Unless the Certificate of Authentication on this Certificate
has been executed by the Trustee, by manual or facsimile signature, this
Certificate shall not be entitled to any benefit under the Trust and Servicing
Agreement or be valid for any purpose.
The Trustee makes no representation or warranty as to any of
the statements contained herein or the validity or sufficiency of the
Certificates or the Mortgage Loans and has executed this Certificate in its
limited capacity as Trustee under the Trust and Servicing Agreement.
A1-5
IN WITNESS WHEREOF, the Trustee has caused this instrument to
be duly executed.
Dated: ______________
JPMORGAN CHASE BANK,
not in its individual capacity but
solely as Trustee
By: ___________________________
Authorized Officer
Certificate of Authentication
-----------------------------
This is one of the Class Certificates referred to in the Trust
and Servicing Agreement.
Dated: ______________
JPMORGAN CHASE BANK,
not in its individual capacity but
solely as Trustee
By: ___________________________
Authorized Officer
A1-6
ASSIGNMENT
FOR VALUE RECEIVED, the undersigned ("ASSIGNOR(S)") hereby
sell(s), assign(s) and transfer(s) unto _______________________________________
(please print or typewrite name(s) and address(es), including postal zip code(s)
of assignee(s)) ("ASSIGNEE(S)") the entire Percentage Interest represented by
the within Certificate and hereby authorize(s) the registration of transfer of
such interest to Assignee(s) on the Certificate Register of the Trust.
I (we) further direct the Certificate Registrar to issue a new
Certificate of the entire Percentage Interest represented by the within
Certificates to the above-named Assignee(s) and to deliver such Certificate to
the following address:
___________________________
___________________________
___________________________
Date: __________________
Signature by or on behalf of
Assignor(s):
_________________________
Taxpayer Identification Number: _________
A1-7
DISTRIBUTION INSTRUCTIONS
The Assignee(s) should include the following for purposes of
distribution:
Address of the Assignee(s) for the purpose of receiving notices and
distributions:
________________________________________________________________________.
Distributions, if being made by wire transfer in immediately
available funds, to ______________________ for the account of __________________
account number ____________________.
This information is provided by _________________________ the
Assignee(s) named above, or ______________________________ as its (their) agent.
By: ______________________________
[Please print or type name(s)]
Title:_____________________________
Taxpayer Identification Number:_________
▇▇-▇
▇▇▇▇▇▇▇ ▇-▇
[FORM OF CLASS X CERTIFICATE]
GSRPM MORTGAGE PASS-THROUGH CERTIFICATES,
SERIES 2003-1, CLASS X CERTIFICATE
THIS CERTIFICATE DOES NOT REPRESENT AN INTEREST IN OR OBLIGATION OF THE
DEPOSITOR, THE SERVICER, THE TRUSTEE OR ANY OF THEIR RESPECTIVE AFFILIATES.
NEITHER THE CERTIFICATES NOR ANY UNDERLYING MORTGAGE LOAN IS INSURED OR
GUARANTEED BY ANY GOVERNMENTAL AGENCY OR INSTRUMENTALITY.
THIS CERTIFICATE IS SUBORDINATED IN RIGHT OF DISTRIBUTION TO CERTAIN CLASSES OF
THE CERTIFICATES AS SET FORTH HEREIN AND IN THE TRUST AND SERVICING AGREEMENT
REFERRED TO HEREIN.
PRINCIPAL PAYMENTS IN RESPECT OF THIS CERTIFICATE DISTRIBUTABLE AS SET FORTH IN
THE TRUST AND SERVICING AGREEMENT. ACCORDINGLY, THE OUTSTANDING CERTIFICATE
BALANCE OF THIS CERTIFICATE AT ANY TIME MAY BE LESS THAN THE INITIAL CERTIFICATE
BALANCE SET FORTH BELOW. ACCORDINGLY, THE PRINCIPAL BALANCE OF THIS CERTIFICATE
AT ANY TIME MAY BE LESS THAN THE INITIAL PRINCIPAL BALANCE OF THIS CERTIFICATE
AS SET FORTH HEREON.
NEITHER THIS CERTIFICATE NOR ANY INTEREST HEREIN MAY BE TRANSFERRED UNLESS THE
PROPOSED TRANSFEROR DELIVERS TO THE TRUSTEE A TRANSFEROR LETTER IN THE FORM OF
EXHIBIT H TO THE AGREEMENT REFERRED TO HEREIN AND EITHER (I) THE TRUSTEE
RECEIVES A RULE 144A LETTER IN THE FORM OF EXHIBIT I TO THE AGREEMENT REFERRED
TO HEREIN OR (II) THE TRUSTEE RECEIVES AN OPINION OF COUNSEL, DELIVERED AT THE
EXPENSE OF THE TRANSFEROR, THAT SUCH TRANSFER MAY BE MADE WITHOUT REGISTRATION
UNDER THE SECURITIES ACT OF 1933, AS AMENDED.
[THIS CERTIFICATE MAY NOT BE PURCHASED BY OR PLEDGED, SOLD OR OTHERWISE
TRANSFERRED TO ANY PERSON THAT IS OR BECOMES AN EMPLOYEE BENEFIT PLAN OR OTHER
PLAN THAT IS SUBJECT TO THE EMPLOYEE RETIREMENT INCOME SECURITY ACT OF 1974, AS
AMENDED ("ERISA"), OR TO SECTION 4975 OF THE INTERNAL REVENUE CODE OF 1986, AS
AMENDED (THE "CODE"), OR ANY PERSON ACTING ON BEHALF OF ANY SUCH PLAN OR USING
THE ASSETS OF SUCH PLAN TO ACQUIRE THIS CERTIFICATE, UNLESS THE PURCHASER HAS
PROVIDED THE OPINION LETTER SPECIFIED IN SECTION 5.02(B) OF THE TRUST AND
SERVICING AGREEMENT.]
SOLELY FOR U.S. FEDERAL INCOME TAX PURPOSES, THIS CERTIFICATE REPRESENTS A
"REGULAR INTEREST" IN A "REAL ESTATE MORTGAGE
A2-1
INVESTMENT CONDUIT," AS THOSE TERMS ARE DEFINED, RESPECTIVELY, IN SECTIONS
860G(A)(1) AND 860D OF THE INTERNAL REVENUE CODE OF 1986, AS AMENDED.
A2-2
GSRPM MORTGAGE PASS-THROUGH CERTIFICATES,
SERIES 2003-1, CLASS X
Pass-Through Rate: As determined in accordance
with the Trust and Servicing Agreement
First Distribution Date: February 25, 2003 Cut-off Date: January 1, 2003
Aggregate Initial Certificate Balance of Rated Final Distribution Date:
the Class X Certificate: As determined January 2032
in accordance with the Trust and Servicing
Agreement.
Initial Certificate Balance of
this Certificate: As determined
in accordance with the Trust and
No.: X-o _________ Servicing Agreement
This certifies that ___________________. is the registered
owner of a beneficial ownership interest in a Trust, including the distributions
to be made with respect to the Class X Certificates. The Trust consists
primarily of Mortgage Loans secured by residential second liens and certain
other property held in trust by the Trustee. The Trust was created, and the
Mortgage Loans are to be serviced or master serviced pursuant to the Trust and
Servicing Agreement, dated as of January 1, 2003 (the "TRUST AND SERVICING
AGREEMENT"), among GS Mortgage Securities Corp., as Depositor, Fairbanks Capital
Corp., as a Servicer, Wilshire Credit Corporation, as a Servicer and as Master
Servicer and JPMorgan Chase Bank, as Trustee. The Holder of this Certificate, by
virtue of the acceptance hereof, assents to the terms, provisions and conditions
of the Trust and Servicing Agreement and is bound thereby. Also issued under the
Trust and Servicing Agreement are the Class A, Class M-1, Class B-1, Class B-2,
Class B-3, Class P and Class R Certificates (together with the Class X
Certificate, the "Certificates"; the Holders of Certificates issued under the
Trust and Servicing Agreement are collectively referred to herein as
"CERTIFICATEHOLDERS").
This Certificate is issued pursuant to, and in accordance
with, the terms of the Trust and Servicing Agreement. To the extent not defined
herein, capitalized terms used herein shall have the meanings assigned thereto
in the Trust and Servicing Agreement.
Pursuant to the terms of the Trust and Servicing Agreement,
the Trustee, or the Paying Agent on behalf of the Trustee, will distribute
(other than the final distribution on any Certificate), on the 25th day of each
calendar month, or if such day is not a Business Day, the next succeeding
Business Day, commencing February 25, 2003 (each such date, a "DISTRIBUTION
DATE"), to the Person in whose name this Certificate is registered as of the
related Record Date, which will be the close of business on the Business Day
immediately preceding the related Distribution Date, an amount equal to such
Person's pro rata share (based on the Percentage Interest represented by this
A2-3
Certificate) of that portion of the aggregate amount of principal and interest
then distributable, if any, allocable to the Class X Certificates for such
Distribution Date, all as more fully described in the Trust and Servicing
Agreement.
All distributions (other than the final distribution on any
Certificate) will be made to the Persons entitled thereto by wire transfer of
immediately available funds to the account of such Certificateholder at a bank
or other entity located in the United States and having appropriate facilities
therefor. The final distribution on each Certificate shall be made in like
manner, but only upon presentment and surrender of such Certificate at the
Corporate Trust Office of the Trustee or its agent (which may be the Paying
Agent or the Certificate Registrar acting as such agent) that is specified in
the notice to Certificateholders of such final distribution.
This Certificate is limited in right of payment to, among
other things, certain collections and recoveries in respect of the Mortgage
Loans, as more specifically set forth herein and in the Trust and Servicing
Agreement.
As provided in the Trust and Servicing Agreement and with
certain exceptions therein provided, certain losses on the Mortgage Loans
resulting from defaults by Mortgagors will be borne by the Holders of Class M-1,
Class B-1, Class B-2, Class B-3 and Class X Certificates before such losses will
be borne by the Holders of the others classes of Certificates.
This Certificate does not purport to summarize the Trust and
Servicing Agreement, and reference is made to the Trust and Servicing Agreement
for the interests, rights, benefits, obligations and duties evidenced hereby,
and the limitations thereon, and the rights, duties and immunities of the
Trustee.
As provided in the Trust and Servicing Agreement, subject to
certain restrictions on transfer set forth therein, upon surrender for
registration of transfer of any Certificate, the Certificate Registrar shall
execute, authenticate and deliver, in the name of the designated transferee or
transferees, one or more new Certificates in authorized denominations, in like
aggregate interest and of the same Class.
Prior to due presentation of this Certificate for registration
of transfer, the Trustee, the Servicers, the Certificate Registrar, and any
agent of the Trustee, the Servicers or the Certificate Registrar may treat the
Person in whose name any Certificate is registered as the owner of such
Certificate for the purpose of receiving distributions as provided in the Trust
and Servicing Agreement and for all other purposes whatsoever, and neither the
Trustee, the Servicers, the Certificate Registrar, nor any agent of the Trustee,
the Servicers or the Certificate Registrar shall be affected by any notice to
the contrary.
No transfer of a Certificate of this Class shall be made
unless such disposition is exempt from the registration requirements of the
Securities Act of 1933, as amended (the "1933 ACT"), and any applicable state
securities laws or is made in accordance with the 1933 Act and such laws. In the
event of any such transfer, the
A2-4
Trustee shall require the transferor to execute a transferor certificate (in
substantially the form attached to the Trust and Servicing Agreement) and
deliver either (i) a Rule 144A Letter, in either case substantially in the form
attached to the Agreement, or (ii) a written Opinion of Counsel addressed to the
Trustee that such transfer may be made pursuant to an exemption, describing the
applicable exemption and the basis therefor, from the 1933 Act or is being made
pursuant to the 1933 Act, which Opinion of Counsel shall be an expense of the
transferor.
No transfer of a Certificate of this Class shall be made
unless the Trustee shall have received a representation letter from the
transferee of such Certificate, acceptable to and in form and substance
satisfactory to the Trustee, to the effect that such transferee is not an
employee benefit plan subject to ERISA or Section 4975 of the Code or a person
acting on behalf of or investing plan assets of any such plan, which
representation letter shall not be an expense of the Trustee or has provided the
opinion letter required by Section 5.02(b) of the Trust and Servicing Agreement.
The Trust and Servicing Agreement may be amended from time to
time by the Depositor, the affected Servicer and the Trustee, without the
consent of any of the Certificateholders, in certain circumstances specified in
the Trust and Servicing Agreement.
The Trust and Servicing Agreement provides that the respective
obligations and responsibilities of Fairbanks, Wilshire, the Depositor, the
Paying Agent and the Trustee created thereby with respect to the Certificates
(other than the obligation of the Paying Agent to make certain payments to
Certificateholders after the final Distribution Date and other than the
indemnification obligations of the parties hereto) shall terminate upon the last
action required to be taken by the Paying Agent on the final Distribution Date
pursuant to Article X of the Trust and Servicing Agreement upon the later of (a)
the final payment or other liquidation (or any advance made with respect
thereto) of the last Mortgage Loan in the Trust Estate, (b) the disposition of
all property acquired in respect of any Mortgage Loan remaining in the Trust
Estate, and (c) at any time when a Qualified Liquidation of the Mortgage Loans
included within the Trust is effected.
Unless the Certificate of Authentication on this Certificate
has been executed by the Trustee, by manual or facsimile signature, this
Certificate shall not be entitled to any benefit under the Trust and Servicing
Agreement or be valid for any purpose.
The Trustee makes no representation or warranty as to any of
the statements contained herein or the validity or sufficiency of the
Certificates or the Mortgage Loans and has executed this Certificate in its
limited capacity as Trustee under the Trust and Servicing Agreement.
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IN WITNESS WHEREOF, the Trustee has caused this instrument to
be duly executed.
Dated: ______________
JPMORGAN CHASE BANK,
not in its individual capacity but
solely as Trustee
By: ___________________________
Authorized Officer
Certificate of Authentication
-----------------------------
This is one of the Class X Certificates referred to in the
Trust and Servicing Agreement.
Dated: ______________
JPMORGAN CHASE BANK,
not in its individual capacity but
solely as Trustee
By: ___________________________
Authorized Officer
A2-6
ASSIGNMENT
FOR VALUE RECEIVED, the undersigned ("ASSIGNOR(S)") hereby
sell(s), assign(s) and transfer(s) unto _______________________________________
(please print or typewrite name(s) and address(es), including postal zip code(s)
of assignee(s)) ("ASSIGNEE(S)") the entire Percentage Interest represented by
the within Certificate and hereby authorize(s) the registration of transfer of
such interest to Assignee(s) on the Certificate Register of the Trust.
I (we) further direct the Certificate Registrar to issue a new
Certificate of the entire Percentage Interest represented by the within
Certificates to the above-named Assignee(s) and to deliver such Certificate to
the following address:
___________________________
___________________________
___________________________
Date: __________________
Signature by or on behalf of
Assignor(s):
_________________________
Taxpayer Identification Number: _________
A2-7
DISTRIBUTION INSTRUCTIONS
The Assignee(s) should include the following for purposes of
distribution:
Address of the Assignee(s) for the purpose of receiving notices and
distributions:
________________________________________________________________________.
Distributions, if being made by wire transfer in immediately
available funds, to ______________________ for the account of __________________
account number ____________________.
This information is provided by _________________________ the
Assignee(s) named above, or ______________________________ as its (their) agent.
By: ______________________________
[Please print or type name(s)]
Title:_____________________________
Taxpayer Identification Number:_________
▇▇-▇
▇▇▇▇▇▇▇ ▇-▇
[FORM OF CLASS P CERTIFICATE]
GSRPM MORTGAGE PASS-THROUGH CERTIFICATES,
SERIES 2003-1, CLASS P CERTIFICATE
THIS CERTIFICATE DOES NOT REPRESENT AN INTEREST IN OR OBLIGATION OF THE
DEPOSITOR, THE SERVICER, THE TRUSTEE OR ANY OF THEIR RESPECTIVE AFFILIATES.
NEITHER THE CERTIFICATES NOR ANY UNDERLYING MORTGAGE LOAN IS INSURED OR
GUARANTEED BY ANY GOVERNMENTAL AGENCY OR INSTRUMENTALITY.
NEITHER THIS CERTIFICATE NOR ANY INTEREST HEREIN MAY BE TRANSFERRED UNLESS THE
PROPOSED TRANSFEROR DELIVERS TO THE TRUSTEE A TRANSFEROR LETTER IN THE FORM OF
EXHIBIT H TO THE AGREEMENT REFERRED TO HEREIN AND EITHER (I) THE TRUSTEE
RECEIVES A RULE 144A LETTER IN THE FORM OF EXHIBIT I TO THE AGREEMENT REFERRED
TO HEREIN OR (II) THE TRUSTEE RECEIVES AN OPINION OF COUNSEL, DELIVERED AT THE
EXPENSE OF THE TRANSFEROR, THAT SUCH TRANSFER MAY BE MADE WITHOUT REGISTRATION
UNDER THE SECURITIES ACT OF 1933, AS AMENDED.
THIS CERTIFICATE MAY NOT BE PURCHASED BY OR PLEDGED, SOLD OR OTHERWISE
TRANSFERRED TO ANY PERSON THAT IS OR BECOMES AN EMPLOYEE BENEFIT PLAN OR OTHER
PLAN THAT IS SUBJECT TO THE EMPLOYEE RETIREMENT INCOME SECURITY ACT OF 1974, AS
AMENDED ("ERISA"), OR TO SECTION 4975 OF THE INTERNAL REVENUE CODE OF 1986, AS
AMENDED (THE "CODE"), OR ANY PERSON ACTING ON BEHALF OF ANY SUCH PLAN OR USING
THE ASSETS OF SUCH PLAN TO ACQUIRE THIS CERTIFICATE.
SOLELY FOR U.S. FEDERAL INCOME TAX PURPOSES, THIS CERTIFICATE REPRESENTS A
"REGULAR INTEREST" IN A "REAL ESTATE MORTGAGE INVESTMENT CONDUIT," AS THOSE
TERMS ARE DEFINED, RESPECTIVELY, IN SECTIONS 860G(A)(1) AND 860D OF THE INTERNAL
REVENUE CODE OF 1986, AS AMENDED.
A3-1
GSRPM MORTGAGE PASS-THROUGH CERTIFICATES,
SERIES 2003-1, CLASS P
First Distribution Date: February 25, 2003 Cut-off Date: January 1, 2003
Aggregate Initial Certificate Balance of the
Class P Certificates:$100.00
Initial Certificate Balance of this Certificate: $100.00
CUSIP:
This certifies that ___________________. is the registered
owner of a beneficial ownership interest in a Trust, including the distributions
to be made with respect to the Class P Certificates. The Trust consists
primarily of Mortgage Loans secured by residential second liens and certain
other property held in trust by the Trustee. The Trust was created, and the
Mortgage Loans are to be serviced, pursuant to (i) the Trust and Servicing
Agreement, dated as of January 1, 2003 (the "TRUST AND SERVICING AGREEMENT"),
among GS Mortgage Securities Corp., as Depositor, Fairbanks Capital Corp., as a
Servicer, Wilshire Credit Corporation, as a Servicer and Master Servicer and
JPMorgan Chase Bank, as Trustee and (ii) the Servicing Agreement, dated as of
January 1, 2003, by and among the Depositor, the Master Servicer, the Trustee
and GreenPoint Financial Corporation, as Servicer. The Holder of this
Certificate, by virtue of the acceptance hereof, assents to the terms,
provisions and conditions of the Trust and Servicing Agreement and is bound
thereby. Also issued under the Trust and Servicing Agreement are the Class A,
Class M-1, Class B-1, Class B- 2, Class B-3, Class X and Class R Certificates
(together with the Class P Certificate, the "CERTIFICATES"; the Holders of
Certificates issued under the Trust and Servicing Agreement are collectively
referred to herein as "CERTIFICATEHOLDERS").
This Certificate is issued pursuant to, and in accordance
with, the terms of the Trust and Servicing Agreement. To the extent not defined
herein, capitalized terms used herein shall have the meanings assigned thereto
in the Trust and Servicing Agreement.
Pursuant to the terms of the Trust and Servicing Agreement,
the Trustee, or the Paying Agent on behalf of the Trustee, will distribute
(other than the final distribution on any Certificate), on the 25th day of each
calendar month, or if such 25th day is not a Business Day, the next succeeding
Business Day, commencing February 25, 2003 (each such date, a "DISTRIBUTION
DATE"), to the Person in whose name this Certificate is registered as of the
related Record Date, which will be the close of business on the Business Day
immediately preceding such Distribution Date, an amount equal to such Person's
pro rata share (based on the Percentage Interest represented by this
Certificate) of the distributions, if any, allocable to the Class P Certificates
for such Distribution Date, all as more fully described in the Trust and
Servicing Agreement.
A3-2
This Certificate does not have a Pass-Through Rate and will
not be entitled to distributions in respect of interest.
All distributions (other than the final distribution on any
Certificate) will be made to the Persons entitled thereto by wire transfer of
immediately available funds to the account of such Certificateholder at a bank
or other entity located in the United States and having appropriate facilities
therefor. The final distribution on each Certificate shall be made in like
manner, but only upon presentment and surrender of such Certificate at the
Corporate Trust Office of the Trustee or its agent (which may be the Paying
Agent or the Certificate Registrar acting as such agent) that is specified in
the notice to Certificateholders of such final distribution.
This Certificate is limited in right of payment to, among
other things, certain collections and recoveries in respect of the Mortgage
Loans, as more specifically set forth herein and in the Trust and Servicing
Agreement.
This Certificate does not purport to summarize the Trust and
Servicing Agreement, and reference is made to the Trust and Servicing Agreement
for the interests, rights, benefits, obligations and duties evidenced hereby,
and the limitations thereon, and the rights, duties and immunities of the
Trustee.
As provided in the Trust and Servicing Agreement, subject to
certain restrictions on transfer set forth therein, upon surrender for
registration of transfer of any Certificate, the Certificate Registrar shall
execute, authenticate and deliver, in the name of the designated transferee or
transferees, one or more new Certificates in authorized denominations, in like
aggregate interest and of the same Class.
Prior to due presentation of this Certificate for registration
of transfer, the Trustee, the Servicers, the Certificate Registrar, and any
agent of the Trustee, the Servicers or the Certificate Registrar may treat the
Person in whose name any Certificate is registered as the owner of such
Certificate for the purpose of receiving distributions as provided in the Trust
and Servicing Agreement and for all other purposes whatsoever, and neither the
Trustee, the Servicers, the Certificate Registrar, nor any agent of the Trustee,
the Servicers or the Certificate Registrar shall be affected by any notice to
the contrary.
No transfer of a Certificate of this Class shall be made
unless such disposition is exempt from the registration requirements of the
Securities Act of 1933, as amended (the "1933 ACT"), and any applicable state
securities laws or is made in accordance with the 1933 Act and such laws. In the
event of any such transfer, the Trustee shall require the transferor to execute
a transferor certificate (in substantially the form attached to the Trust and
Servicing Agreement) and deliver either (i) a Rule 144A Letter, in either case
substantially in the form attached to the Agreement, or (ii) a written Opinion
of Counsel addressed to the Trustee that such transfer may be made pursuant to
an exemption, describing the applicable exemption and the basis therefor, from
the 1933 Act or is being made pursuant to the 1933 Act, which Opinion of Counsel
shall be an expense of the transferor.
A3-3
No transfer of a Certificate of this Class shall be made
unless the Trustee shall have received a representation letter from the
transferee of such Certificate, acceptable to and in form and substance
satisfactory to the Trustee, to the effect that such transferee is not an
employee benefit plan subject to ERISA or Section 4975 of the Code or a person
acting on behalf of or investing plan assets of any such plan, which
representation letter shall not be an expense of the Trustee.
The Trust and Servicing Agreement may be amended from time to
time by the Depositor, the affected Servicer and the Trustee, without the
consent of any of the Certificateholders, in certain circumstances specified in
the Trust and Servicing Agreement.
The Trust and Servicing Agreement provides that the respective
obligations and responsibilities of Fairbanks, Wilshire, the Depositor, the
Paying Agent and the Trustee created thereby with respect to the Certificates
(other than the obligation of the Paying Agent to make certain payments to
Certificateholders after the final Distribution Date and other than the
indemnification obligations of the parties hereto) shall terminate upon the last
action required to be taken by the Paying Agent on the final Distribution Date
pursuant to Article X of the Trust and Servicing Agreement upon the later of (a)
the final payment or other liquidation (or any advance made with respect
thereto) of the last Mortgage Loan in the Trust Estate, (b) the disposition of
all property acquired in respect of any Mortgage Loan remaining in the Trust
Estate, and (c) at any time when a Qualified Liquidation of the Mortgage Loans
included within the Trust is effected.
Unless the Certificate of Authentication on this Certificate
has been executed by the Trustee, by manual or facsimile signature, this
Certificate shall not be entitled to any benefit under the Trust and Servicing
Agreement or be valid for any purpose.
The Trustee makes no representation or warranty as to any of
the statements contained herein or the validity or sufficiency of the
Certificates or the Mortgage Loans and has executed this Certificate in its
limited capacity as Trustee under the Trust and Servicing Agreement.
A3-4
IN WITNESS WHEREOF, the Trustee has caused this instrument to
be duly executed.
Dated: ______________
JPMORGAN CHASE BANK,
not in its individual capacity but
solely as Trustee
By: ___________________________
Authorized Officer
Certificate of Authentication
-----------------------------
This is one of the Class P Certificates referred to in the
Trust and Servicing Agreement.
Dated: ______________
JPMORGAN CHASE BANK,
not in its individual capacity but
solely as Trustee
By: ___________________________
Authorized Officer
A3-5
ASSIGNMENT
FOR VALUE RECEIVED, the undersigned ("ASSIGNOR(S)") hereby
sell(s), assign(s) and transfer(s) unto _______________________________________
(please print or typewrite name(s) and address(es), including postal zip code(s)
of assignee(s)) ("ASSIGNEE(S)") the entire Percentage Interest represented by
the within Certificate and hereby authorize(s) the registration of transfer of
such interest to Assignee(s) on the Certificate Register of the Trust.
I (we) further direct the Certificate Registrar to issue a new
Certificate of the entire Percentage Interest represented by the within
Certificates to the above-named Assignee(s) and to deliver such Certificate to
the following address:
___________________________
___________________________
___________________________
Date: __________________
Signature by or on behalf of
Assignor(s):
_________________________
Taxpayer Identification Number: _________
A3-6
DISTRIBUTION INSTRUCTIONS
The Assignee(s) should include the following for purposes of
distribution:
Address of the Assignee(s) for the purpose of receiving notices and
distributions:
________________________________________________________________________.
Distributions, if being made by wire transfer in immediately
available funds, to ______________________ for the account of __________________
account number ____________________.
This information is provided by _________________________ the
Assignee(s) named above, or ______________________________ as its (their) agent.
By: ______________________________
[Please print or type name(s)]
Title:_____________________________
Taxpayer Identification Number:_________
▇▇-▇
▇▇▇▇▇▇▇ ▇-▇
[FORM OF RESIDUAL CERTIFICATE]
GSRPM MORTGAGE PASS-THROUGH CERTIFICATES,
SERIES 2003-1, CLASS RO CERTIFICATE
THIS CERTIFICATE DOES NOT REPRESENT AN INTEREST IN OR OBLIGATION OF THE
DEPOSITOR, THE SERVICERS, THE TRUSTEE OR ANY OF THEIR RESPECTIVE AFFILIATES.
NEITHER THIS CERTIFICATE NOR THE UNDERLYING MORTGAGE LOAN IS INSURED OR
GUARANTEED BY ANY GOVERNMENTAL AGENCY OR INSTRUMENTALITY.
NEITHER THIS CERTIFICATE NOR ANY INTEREST HEREIN MAY BE TRANSFERRED UNLESS THE
PROPOSED TRANSFEROR DELIVERS TO THE TRUSTEE A TRANSFEROR LETTER IN THE FORM OF
EXHIBIT H TO THE AGREEMENT REFERRED TO HEREIN AND EITHER (I) THE TRUSTEE
RECEIVES A RULE 144A LETTER IN THE FORM OF EXHIBIT I TO THE AGREEMENT REFERRED
TO HEREIN OR (II) THE TRUSTEE RECEIVES AN OPINION OF COUNSEL, DELIVERED AT THE
EXPENSE OF THE TRANSFEROR, THAT SUCH TRANSFER MAY BE MADE WITHOUT REGISTRATION
UNDER THE SECURITIES ACT OF 1933, AS AMENDED.
THIS CERTIFICATE MAY NOT BE PURCHASED BY OR PLEDGED, SOLD OR OTHERWISE
TRANSFERRED TO ANY PERSON THAT IS OR BECOMES AN EMPLOYEE BENEFIT PLAN OR OTHER
PLAN THAT IS SUBJECT TO THE EMPLOYEE RETIREMENT INCOME SECURITY ACT OF 1974, AS
AMENDED ("ERISA"), OR TO SECTION 4975 OF THE INTERNAL REVENUE CODE OF 1986, AS
AMENDED (THE "CODE"), OR ANY PERSON ACTING ON BEHALF OF ANY SUCH PLAN OR USING
THE ASSETS OF SUCH PLAN TO ACQUIRE THIS CERTIFICATE.
FOR U.S. FEDERAL INCOME TAX PURPOSES, THIS CERTIFICATE IS A "RESIDUAL INTEREST"
IN A "REAL ESTATE MORTGAGE INVESTMENT CONDUIT" AS THOSE TERMS ARE DEFINED,
RESPECTIVELY, IN SECTIONS 860G(A)(2) AND 860D OF THE CODE. A TRANSFEREE OF THIS
CERTIFICATE, BY ACCEPTANCE HEREOF, IS DEEMED TO HAVE ACCEPTED THIS CERTIFICATE
SUBJECT TO CERTAIN RESTRICTIONS ON TRANSFERABILITY, AS SET FORTH IN SECTION 5.04
OF THE TRUST AND SERVICING AGREEMENT, AND SHALL BE REQUIRED TO FURNISH AN
AFFIDAVIT TO THE TRANSFEROR AND THE TRUSTEE TO THE EFFECT THAT, AMONG OTHER
THINGS, (A) IT IS NOT A DISQUALIFIED ORGANIZATION, AS SUCH TERM IS DEFINED IN
CODE SECTION 860E(E)(5), OR AN AGENT (INCLUDING A BROKER, NOMINEE OR OTHER
MIDDLEMAN) FOR SUCH DISQUALIFIED ORGANIZATION AND IS OTHERWISE A PERMITTED
TRANSFEREE (AS DEFINED IN THE TRUST
A4-1
AND SERVICING AGREEMENT REFERRED TO HEREIN), (B) IT HAS HISTORICALLY PAID ITS
DEBTS AS THEY HAVE COME DUE AND INTENDS TO CONTINUE TO PAY ITS DEBTS AS THEY
COME DUE IN THE FUTURE, AND (C) IT INTENDS TO PAY ANY TAXES ASSOCIATED WITH
HOLDING THIS CERTIFICATE AS THEY BECOME DUE. ANY PURPORTED TRANSFER TO A
DISQUALIFIED ORGANIZATION OR OTHER PERSON THAT IS NOT A PERMITTED TRANSFEREE OR
OTHERWISE IN VIOLATION OF THESE RESTRICTIONS SHALL BE ABSOLUTELY NULL AND VOID
AND SHALL VEST NO RIGHTS IN ANY PURPORTED TRANSFEREE. IF THIS CERTIFICATE
REPRESENTS A "NON-ECONOMIC RESIDUAL INTEREST", AS DEFINED IN TREASURY
REGULATIONS SECTION 1.860E-L(C), TRANSFERS OF THIS CERTIFICATE MAY BE
DISREGARDED FOR FEDERAL INCOME TAX PURPOSES. IN ORDER TO SATISFY A REGULATORY
SAFE HARBOR UNDER WHICH SUCH TRANSFERS WILL NOT BE DISREGARDED, THE TRANSFEROR
MAY BE REQUIRED, AMONG OTHER THINGS, TO SATISFY ITSELF AS TO THE FINANCIAL
CONDITION OF THE PROPOSED TRANSFEREE. THE HOLDER OF THIS CERTIFICATE, BY
ACCEPTANCE HEREOF, IS DEEMED TO HAVE AGREED TO CONSENT TO ACT AS "TAX MATTERS
PERSON" OF THE REMIC IN WHICH THIS CERTIFICATE CONSTITUTES THE RESIDUAL INTEREST
AND TO THE APPOINTMENT OF THE TRUSTEE AS ATTORNEY-IN-FACT AND AGENT FOR THE TAX
MATTERS PERSON OR AS OTHERWISE PROVIDED IN THE TRUST AND SERVICING AGREEMENT TO
PERFORM THE FUNCTIONS OF A "TAX MATTERS PERSON" FOR PURPOSES OF SUBCHAPTER C OF
CHAPTER 63 OF SUBTITLE F OF THE CODE.
A4-2
GSRPM MORTGAGE PASS-THROUGH CERTIFICATES,
SERIES 2003-1, CLASS Ro CERTIFICATE
Percentage Interest: 100%
CUSIP:
No.:o -1
This certifies that ________________. is the registered owner
of the "residual interest" (as defined in Section 860G(a)(1) of the Code) in
REMIC [II] [I] designated pursuant to the Trust and Servicing Agreement (as
defined below), including the distributions to be made with respect to the Class
R Certificates. The Trust was created, and the Mortgage Loan is to be serviced,
pursuant to the Trust and Servicing Agreement. The Holder of this Certificate,
by virtue of the acceptance hereof, assents to the terms, provisions and
conditions of the Trust and Servicing Agreement and is bound thereby. Also
issued under the Trust and Servicing Agreement are the Class A-1, Class A-2,
Class A-3, Class M-1, Class B-1, Class B-2, Class B-3, Class X and Class P
Certificates (the "CERTIFICATES"; the Holders of Certificates issued under the
Trust and Servicing Agreement are collectively referred to herein as
"CERTIFICATEHOLDERS").
This Certificate is issued pursuant to, and in accordance
with, the terms of a Trust and Servicing Agreement dated as of January 1, 2003
(the "TRUST AND SERVICING AGREEMENT"), among GS Mortgage Securities Corp., as
Depositor, Fairbanks Capital Corp., as a Servicer, Wilshire Credit Corporation,
as a Servicer and Master Servicer and JPMorgan Chase Bank, as Trustee. To the
extent not defined herein, capitalized terms used herein shall have the meanings
assigned thereto in the Trust and Servicing Agreement.
The Trustee makes no representation or warranty as to any of
the statements contained herein or the validity or sufficiency of the
Certificates or the Mortgage Loans and has executed this Certificate in its
limited capacity as Trustee under the Trust and Servicing Agreement.
Pursuant to the terms of the Trust and Servicing Agreement,
the Trustee, or the Paying Agent on behalf of the Trustee, will distribute
(other than the final distribution on any Certificate), on the 25th day of each
calendar month or, if such day is not a Business Day, the next succeeding
Business Day, commencing on February 25, 2003 (each such date, a "DISTRIBUTION
DATE"), to the Person in whose name this Certificate is registered as of the
related Record Date, an amount equal to the amount then distributable, if any,
allocable to the Class o Certificate for such Distribution Date, all as more
fully described in the Trust and Servicing Agreement.
A4-3
This Certificate is limited in right of payment to, among
other things, certain collections and recoveries in respect of the Mortgage
Loans, as more specifically set forth herein and in the Trust and Servicing
Agreement.
This Certificate does not purport to summarize the Trust and
Servicing Agreement, and reference is made to the Trust and Servicing Agreement
for the interests, rights, benefits, obligations and duties evidenced hereby,
and the limitations thereon, and the rights, duties and immunities of the
Trustee.
As provided in the Trust and Servicing Agreement, subject to
certain restrictions on transfer set forth therein, upon surrender for
registration of transfer of any Certificate, the Certificate Registrar shall
execute, authenticate and deliver, in the name of the designated transferee or
transferees, one or more new Certificates in authorized denominations, in like
aggregate interest and of the same Class.
Prior to due presentation of this Certificate for registration
of transfer, the Trustee, the Servicers, the Certificate Registrar, and any
agent of the Trustee, the Servicers or the Certificate Registrar may treat the
Person in whose name any Certificate is registered as the owner of such
Certificate for the purpose of receiving distributions as provided in the Trust
and Servicing Agreement and for all other purposes whatsoever, and neither the
Trustee, the Servicers, the Certificate Registrar, nor any agent of the Trustee,
the Servicers or the Certificate Registrar shall be affected by any notice to
the contrary.
No transfer of a Certificate of this Class shall be made
unless such transfer is exempt from the registration requirements of the
Securities Act of 1933, as amended (the "1933 ACT"), and any applicable state
securities laws or is made in accordance with the 1933 Act and such laws. In the
event of any such transfer, the Trustee shall require the transferor to execute
a transferor certificate (in substantially the form attached to the Trust and
Servicing Agreement) and deliver either (i) a Rule 144A Letter, in either case
substantially in the form attached to the Agreement, or (ii) a written Opinion
of Counsel addressed to the Trustee that such transfer may be made pursuant to
an exemption, describing the applicable exemption and the basis therefor, from
the 1933 Act or is being made pursuant to the 1933 Act, which Opinion of Counsel
shall be an expense of the transferor.
No transfer of a Certificate of this Class shall be made
unless the Trustee shall have received a representation letter from the
transferee of such Certificate, acceptable to and in form and substance
satisfactory to the Trustee, to the effect that such transferee is not an
employee benefit plan subject to ERISA or Section 4975 of the Code or a person
acting on behalf of or investing plan assets of any such plan, which
representation letter shall not be an expense of the Trustee.
The Trust and Servicing Agreement may be amended from time to
time by the Depositor, the affected Servicer and the Trustee, without the
consent of any of the
A4-4
Certificateholders, in certain circumstances specified in the Trust and
Servicing Agreement.
The Trust and Servicing Agreement provides that the respective
obligations and responsibilities of Fairbanks, Wilshire, the Depositor, the
Paying Agent and the Trustee created thereby with respect to the Certificates
(other than the obligation of the Paying Agent to make certain payments to
Certificateholders after the final Distribution Date and other than the
indemnification obligations of the parties hereto) shall terminate upon the last
action required to be taken by the Paying Agent on the final Distribution Date
pursuant to Article X of the Trust and Servicing Agreement upon the later of (a)
the final payment or other liquidation (or any advance made with respect
thereto) of the last Mortgage Loan in the Trust Estate, (b) the disposition of
all property acquired in respect of any Mortgage Loan remaining in the Trust
Estate, and (c) at any time when a Qualified Liquidation of the Mortgage Loans
included within the Trust is effected.
Unless the Certificate of Authentication on this Certificate
has been executed by the Trustee, by manual or facsimile signature, this
Certificate shall not be entitled to any benefit under the Trust and Servicing
Agreement or be valid for any purpose.
The Trustee makes no representation or warranty as to any of
the statements contained herein or the validity or sufficiency of the
Certificates or the Mortgage Loans and has executed this Certificate in its
limited capacity as Trustee under the Trust and Servicing Agreement.
A4-5
IN WITNESS WHEREOF, the Trustee has caused this instrument to
be duly executed.
Dated: ______________
JPMORGAN CHASE BANK,
not in its individual capacity but
solely as Trustee
By: ___________________________
Authorized Officer
Certificate of Authentication
-----------------------------
This is one of the Class Certificates referred to in the Trust
and Servicing Agreement.
Dated: ______________
JPMORGAN CHASE BANK,
not in its individual capacity but
solely as Trustee
By: ___________________________
Authorized Officer
A4-6
ASSIGNMENT
FOR VALUE RECEIVED, the undersigned ("ASSIGNOR(S)") hereby
sell(s), assign(s) and transfer(s) unto _______________________________________
(please print or typewrite name(s) and address(es), including postal zip code(s)
of assignee(s)) ("ASSIGNEE(S)") the entire Percentage Interest represented by
the within Certificate and hereby authorize(s) the registration of transfer of
such interest to Assignee(s) on the Certificate Register of the Trust.
I (we) further direct the Certificate Registrar to issue a new
Certificate of the entire Percentage Interest represented by the within
Certificates to the above-named Assignee(s) and to deliver such Certificate to
the following address:
___________________________
___________________________
___________________________
Date: __________________
Signature by or on behalf of
Assignor(s):
_________________________
Taxpayer Identification Number: _________
A4-7
DISTRIBUTION INSTRUCTIONS
The Assignee(s) should include the following for purposes of
distribution:
Address of the Assignee(s) for the purpose of receiving notices and
distributions:
________________________________________________________________________.
Distributions, if being made by wire transfer in immediately
available funds, to ______________________ for the account of __________________
account number ____________________.
This information is provided by _________________________ the
Assignee(s) named above, or ______________________________ as its (their) agent.
By: ______________________________
[Please print or type name(s)]
Title:_____________________________
Taxpayer Identification Number:_________
A4-8
Exhibit B
CERTIFICATE INSURANCE POLICY
[This Policy is maintained by the Trustee at the Corporate Trust Office.]
B-1
EXHIBIT C
FAIRBANKS SERVICING STANDARDS
These are the Servicing Standards referenced in the Agreement. These Servicing
Standards apply to all Fairbanks Mortgage Loans, and REO Properties. The
Servicing Standards will be measured at any time of measurement with respect to
Fairbanks Mortgage Loans. Failure to achieve the standards and cure any
Exceedance (as described herein) can result in financial penalties for Fairbanks
and possibly trigger termination of Fairbanks as Servicer as set forth below.
There are two different levels of Servicing Standards that will be used to
determine Service Level Penalties. Level 1 Standards are the critical Servicing
Standards that will be used (i) to determine financial penalties and (ii) to
determine potential termination events of Fairbanks. The Level 2 Standards are
incremental operating standards that will be used solely to determine financial
penalties. Financial penalties and termination events for failure to meet Level
1 Standards are intended to be included in the Agreement.
There are two different types of Servicing Standards (Base and Termination)
which are used to define financial penalties and termination events. The number
of Exceedances for Servicer Penalty purposes will be determined by the number of
times the Fairbanks' performance does not meet the Base Standard specified for
such performance area in Table 2. Service Level Penalties will be paid as
described below. For purposes of calculating the Service Level Penalties,
[Financial Penalties] will be calculated based on Table 1. The levels set forth
in the ["Termination Standards"] column in Table 2 are the measures used to
determine whether an event of termination has occurred pursuant to the Trust and
Servicing Agreement.
SERVICE LEVEL PENALTIES: If during any month during the term of the Agreement
the Servicer performs servicing below acceptable tolerance levels, as more
particularly set forth herein, the Trust shall, unless the Servicer cures the
Exceedance as described below, be entitled to a Service Level Penalty in an
amount calculated as set forth on Table 1, with respect to the related
Performance Standard. The Servicer shall notify the Trust of the below
acceptable level occurrence and corresponding Exceedance, and the Servicer shall
attempt to cure the deficiency during the applicable cure period. The Servicer
shall have a period of sixty (60) days in which to cure such occurrence by
bringing the related Performance Standard to within agreed to service levels in
the second full month following the month in which such Exceedance occurs. For
example, if in the month of March there is a Level 1 Exceedance for Right Party
Contacts, and the same Exceedance for Right Party Contacts occurs in both April
and May, then in May, the Service Level Penalty will be imposed and payable by
the Servicer for all three monthly periods. If, however, in May the Servicer
brings the Right Party Contacts within acceptable tolerance levels, there will
be no Service Level Penalty imposed with respect to the March and April
Exceedance. If a Service Level Penalty is due and owing in any month, it shall
be invoiced by the Trust to the Servicer and paid by the Servicer within fifteen
(15) days of receipt of the invoice.
TERMINATION: The Servicer may be terminated pursuant to Section 8.17(c) of the
Agreement if the Servicer fails to meet the Performance Standards and
Exceedances occur and continue as follows: (x) the occurrence of any five (5)
Level 1 Termination Standard Exceedances for three (3) consecutive months, or
(y) the occurrence of any three (3) Level 1 Termination Standard Exceedances for
six (6) consecutive months, or (z) the occurrence of the same one (1) Level 1
Termination Standard Exceedance for nine (9) consecutive months. For purposes of
this Exhibit C, the Servicer will be deemed to meet a Performance Standard if it
is performing up to the Termination Standards Level for such Performance
Standard, all as more particularly set forth herein.
During the term of the Trust and Servicing Agreement, Fairbanks performance is
measured against the Base Standard Levels. In this period, failure to achieve
the Base Standards will create Exceedances. If Fairbanks is unable to cure any
Exceedance within a 60-day cure period, the following financial penalties will
be established as an unsecured obligation of Fairbanks to the Trust, varying
based upon the number of Exceedances that have occurred with respect to the Base
Standards:
TABLE 1
SERVICE LEVEL PENALTIES
NUMBER OF EXCEEDANCES FINANCIAL PENALTY ACCRUING
REMAINING UNCURED MONTHLY UNTIL CURED (%UPB)
----------------- --------------------------
LEVEL 1
-------
1-2 0.0200%
3-4 0.0500%
5+ 0.1500%
▇▇▇▇▇ ▇
-------
1-2 0.0100%
3-4 0.0200%
4-5 0.0400%
TABLE 2
STATED PRINCIPAL BALANCE
SERVICING STANDARD GUIDELINES
BASE TERMINATION
LEVEL 1 STANDARDS STANDARD STANDARD
----------------- -------- --------
1. Right party contacts (First 15 days of
delinquency)
Fairbanks will achieve an average daily Right 30% 22.5%
Party Contact Rate for the month against all
accounts in their first 15 days of delinquency
2. Right party contacts (After the 15th day of
delinquency but not in foreclosure)
Fairbanks will achieve an average daily 25% 18.75%
Right Party Contact Rate for the month against
all accounts past the first 15 days of
delinquency but prior to foreclosure
3 Promise to Pay
Fairbanks will achieve an average daily Promise 30% 22.5%
to Pay on a minimum percentage of all loans 1 -
89 days delinquent
4 Roll Rate (1 to 29 days of delinquency - MBA
method)
Fairbanks shall achieve a rolling three month
average percentage of loans, based on Stated
Principal Balance, that remain in the same 70% 52.5%
bucket or improve their delinquency status
(including loans that payoff or are otherwise
liquidated) from previous month-end to current
month-end
5 Roll Rate (30 to 59 days of delinquency - [MBA] 60% 45%
method)
C-1
Fairbanks shall achieve a rolling three month
average percentage of loans, based on Stated
Principal Balance, that remain in the same
bucket or improve their delinquency status
(including loans that payoff or are otherwise
liquidated) from previous month-end to current
month-end
6 Roll Rate (60 to 89 days of delinquency 40% 30%
MBA method)
Fairbanks shall achieve a rolling three month
average percentage of loans, based on Stated
Principal Balance, that remain in the same
bucket or improve their delinquency status
(including loans that payoff or are otherwise
liquidated) from previous month-end to current
month-end
7 Abandonment Rate
Fairbanks will operate its customer service 10% 13.3%
area to achieve no more than a maximum
abandonment rate on customer calls
8 REO sales
Fairbanks will sell a minimum percentage of the
REO Sellable Portfolio on a monthly basis and 15% 11.25%
will obtain a Total Sales Price to Total
Reconciled Market Value of at least 95%
measured on a rolling three month average
9 Fairbanks will obtain a minimum Pre-
Foreclosure Resolution Rate on a rolling three 60% 45%
month average
C-2
10 Fairbanks will meet a minimum Foreclosure
Timeline percentage on a rolling three month 100% 120%*
average basis
-------
* On pre-Fairbanks initiated foreclosure actions, the Termination Standard is
130%.
▇-▇
▇▇▇▇
▇▇▇▇▇ ▇ ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇
----------------- --------
1. Skip tracing 100%
No later than the 30th day of delinquency, if no
mortgagor contact has been made, or as early as
there is an indication of inability to contact
the mortgagor with the provided information, if
sooner. Fairbanks will implement all skip
tracing methods (i.e., establishing a phone
number contact)
2. Written correspondence 100%
Fairbanks will mail a late notice to all
borrowers once they are 5 days past their due
date, except for the loans that are screened out
for such written correspondence for reasons
including, but not limited to, bankruptcies and
[Early Indicator Scoring (EIS)]
3 [Demand letter] (Written correspondence) 95%
Fairbanks will send a demand letter no later
than the 60th day of delinquency
5 Average Call Pick-up Time 100%
Fairbanks will operate its [Customer Service
Area] such that the average call pick-up time
for incoming calls is less than or equal to 150
seconds
C-4
DEFINITIONS FOR LEVEL 1& 2 SERVICING STANDARDS
----------------------------------------------
ABANDONMENT RATE The percentage of total incoming calls to the customer service
area which are not directed to the automated telephony response system in which
the customer terminates the call prior to connection with a customer service
representative.
ATTEMPT shall include, at a minimum, an actual dialing of an outbound call to
the borrower's telephone number.
AVERAGE CALL PICK-UP TIME The average number of seconds that a customer, other
than those that select the automated telephony response system, are on hold
prior to speaking to a customer service representative.
COLLECTION CALLS - FIRST 15 DAYS OF DELINQUENCY These calls are made for all
mortgage loans that are past due and have broken a Promise to Pay between the
first and 15th day of delinquency, except for loans that are screened out from
such calls for reasons including, but not limited to: bankruptcies, interim
payments in the first 30 days after transfer, loans for which borrowers have
requested in writing that Fairbanks not contact them and early indicator scoring
exclusions. On initial contact for a second lien account, Fairbanks shall obtain
senior lien information for the mortgagor. The expectation is that Fairbanks
will make an Attempt every other business day.
COLLECTION CALLS - AFTER THE 15TH DAY OF DELINQUENCY BUT NOT YET IN FORECLOSURE.
These calls are made for all Mortgage Loans that are delinquent and have broken
a Promise to Pay after the 15th day of delinquency, except for loans that are
screened out from such calls for reasons including, but not limited to:
bankruptcies, loans in foreclosure, loans for which borrowers have requested in
writing that Fairbanks not contact them and early indicator scoring exclusions.
As applicable, the expectation is that Fairbanks will make two Attempts each
business day.
FORECLOSURE TIMELINES For Mortgage Loans in foreclosure, Fairbanks will, subject
to clause (ii) below, meet or improve upon the foreclosure timelines. Fairbanks
will use the most recently published ▇▇▇▇▇▇▇ Mac foreclosure timelines as may be
amended from time to time. Fairbanks will not be penalized with a reduction in
fees for unavoidable delays such as bankruptcy, missing documents, workouts
authorized by the residual holder, contested actions, service of process delays,
sheriff sale scheduling delays, court delays in entering judgment or scheduling
hearings, and other circumstances agreed to by the residual holder, provided
that Fairbanks (i) has documented its system accordingly and (ii) upon request
by the residual holder, provide a report of such conditions, such report
detailing corrective actions taken, the date of such actions and the expected
resolution date, and demonstrating diligent time management to resolve such
issues.
FORECLOSURE TIMELINE PERCENTAGE For all Mortgage Loans with a completed
foreclosure sale during the preceding month, the average across all such loans
of the ratio of the number of days to foreclosure from the date of the
foreclosure initiation divided by the applicable [▇▇▇▇▇▇▇ Mac] standard in the
relevant state.
PRE-FORECLOSURE RESOLUTION shall mean any of the following:
- Reinstatement - means any defaulted mortgage loan for which the
borrower brings the Mortgage Loan back to a status no more than 60
days delinquent through a lump
C-5
sum payment or otherwise consistent with the
terms of the Trust and Servicing Agreement.
- Full payoff - means any defaulted mortgage
loan which is paid in full as defined in the
Trust and Servicing Agreement.
- Cash for keys - means a defaulted mortgage loan for which the
mortgagor surrenders the property in exchange for a cash sum to
enable foreclosure on a property with imperfect title.
- Shortfall payoff - means a defaulted mortgage loan for which a
final payment in an amount less than the indebtedness owed under
the applicable mortgage note is made consistent with the terms of
the related Trust and Servicing Agreement and such payment is
received by Fairbanks in full satisfaction of such indebtedness.
- Deed-in-Lieu of Foreclosure - means a defaulted mortgage loan for
which title to the mortgaged property is taken by Fairbanks
through deed in lieu of foreclosure and the resulting REO Property
is to be liquidated consistent with the terms of the Trust and
Servicing Agreement.
- Modification/Deferral (subject to REMIC restrictions) - means a
defaulted mortgage loan which is modified in a manner consistent
with the Trust and Servicing Agreement and for which the borrower
has made three consecutive payments consistent with the terms of
such mortgage loan as so modified.
- Forbearance Plan - means a defaulted mortgage loan for which a
borrower has made three consecutive payments in accordance with a
forbearance plan entered into by the borrower.
- Take-out at Foreclosure Sale - means the mortgaged property
related to a defaulted mortgage loan that is purchased at a
foreclosure sale by a party other than Fairbanks in a manner
consistent with the Trust and Servicing Agreement.
PRE-FORECLOSURE RESOLUTION RATE is calculated as the percentage of the loans (by
number) that are at least 90 days past due at the beginning of a month on which
a Pre-Foreclosure Resolution is achieved during the month divided by the sum of
such resolved loans and the number of loans that go to REO during the month.
PROMISE TO PAY is an agreement with the [Obligor] to make at least one full
payment within thirty days.
RECONCILED MARKET VALUE ("RMV") is the targeted sales price of a REO property.
RMV is established following an analysis by Fairbanks' in-house appraisers of
competing marketing plans and other market conditions. This analysis will
include a review of the interior [Broker Price Opinions] (BPOs) received from
the listing agent and an outside third party real-estate agent. This set value
never changes throughout the servicing of the REO asset and will be reflected in
all reporting.
REO SELLABLE PORTFOLIO is the entire REO portfolio less any REO in eviction,
redemption under contract or other situations in which Fairbanks cannot pass
marketable title.
C-6
RIGHT PARTY CONTACT RATE means a person-to-person contact with an obligor (a
signer of the Mortgage Note), or, where applicable, the obligor's legal guardian
or attorney-in-fact with respect to the loan, or other third party as appointed
by the mortgagor.
ROLL RATE is calculated as a three month rolling average percentage of loans,
based on Stated Principal Balance, that remain in the same bucket or improve
their delinquency status (including loans that payoff or are otherwise
liquidated) from previous month-end to current month-end.
TOTAL RECONCILED MARKET VALUE is the sum of all the RMVs on all the REO closings
in the month.
TOTAL SALES PRICE is the sum of the sales price of all REO closings in the
month, less any Sellers' closing concessions in which the sales price was
inflated to reflect the concession amount.
C-7
Exhibit D
WILSHIRE SERVICING STANDARDS
TABLE 1
LEVEL 1 STANDARDS STANDARD TERMINATION STANDARD
----------------- -------- --------------------
1 Right party contacts (First 15 days of
delinquency)
Wilshire will achieve an average daily 30% 22.5%
Right Party Contact Rate for the month
against all accounts in their first 15 days
of delinquency
2 Right party contacts (After the 15th day
of delinquency but not in foreclosure)
Wilshire will achieve an average daily 25% 18.75%
Right Party Contact Rate for the month
against all accounts past the first 15 days
of delinquency but prior to foreclosure
3 Promise to Pay
Wilshire will achieve an average daily 30% 22.5%
Promise to Pay on a minimum percentage
of all loans 1-89 days delinquent
4 Roll Rate (1 to 29 days of delinquency--
MBA method)
▇-▇
▇▇▇▇▇ ▇ ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇▇▇ STANDARD
----------------- -------- --------------------
Wilshire shall achieve a rolling three 70% 52.5%
month average percentage of loans, based
on Stated Principal Balance, that remain
in the same bucket or improve their
delinquency status (including loans that
payoff or are otherwise liquidated) from
previous month-end to current month-end
5 Roll Rate (30 to 59 days of delinquency 60% 45%
-- MBA method)
Wilshire shall achieve a rolling three month
average percentage of loans, based on Stated
Principal Balance, that remain in the same
bucket or improve their delinquency status
(including loans payoff or are otherwise
liquidated) from previous month-end to
current month-end 6
6 Roll Rate (60 to 89 days of delinquency
-- MBA method)
Wilshire shall achieve a rolling three 40% 30%
month average percentage of loans, based
on Stated Principal Balance, that remain
in the same bucket or improve their
delinquency status (including loans that
payoff or are otherwise liquidated) from
previous month-end to current month-end
7 Abandonment Rate
Wilshire will operate its customer 10% 13.3%
service area to achieve no more than a
maximum abandonment rate on customer
calls
▇-▇
▇▇▇▇▇ ▇ ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇▇▇ STANDARD
----------------- -------- --------------------
8 REO sales
Wilshire will sell a minimum percentage 15% 11.25%
of the REO Sellable Portfolio on a
monthly basis and will obtain a Total
Sales Price to Total Reconciled Market
Value of at least 95% measured on a
rolling three month average
9 Wilshire will obtain a minimum 60% 45%
Pre-Foreclosure Resolution Rate on a
rolling three month average 10
10 Wilshire will meet a minimum Foreclosure 100% 120%*
Timeline Percentage on a rolling three
month average basis
*On pre-servicer initiated foreclosure actions, termination standard is 130%.
TABLE 2
LEVEL 2 STANDARDS TERMINATION STANDARD
----------------- --------------------
1. Skip tracing 100%
No later than the 30th day of delinquency, if
no mortgagor contact has been made, or as
early as there is an indication of inability
to contact the mortgagor with the provided
information, if sooner. Wilshire will
implement all skip tracing methods (i.e.,
establishing a phone number contact)
2. Early late notices (written correspondence) 100%
▇-▇
▇▇▇▇▇ ▇ ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇▇▇ STANDARD
----------------- --------------------
Wilshire will mail a late notice to all
borrowers once they are 5 days past their due
date, except for the loans that are screened
out for such written correspondence for
reasons including, but not limited to,
bankruptcies and Early Indicator Scoring
(EIS)
3. Demand letter (written correspondence) 95%
Wilshire will send a demand letter no later
than the 60th day of delinquency
4. Customer service turnaround times (Both must
be met to pass this test)
Wilshire shall achieve minimum turnaround
times on the following written requests: 10 days
- 99% of Customer generated research
requests are resolved within specified
business days (Monday-Friday) from 30 days
receipt of the request
- Consumer affairs - resolved within
specified calendar days
5. Average Call Pick-up Time 100%
Wilshire will operate its Customer Service
Area such that the average call pick-up time
for incoming calls is less than or equal to
150 seconds
These Performance Standards may be measured at any time and apply to all
Wilshire Mortgage Loans and REO Properties in the aggregate. Repeated violations
of the Termination Standards set forth above (each failure to meet the
Termination Standards set forth herein on any date of determination, an
"EXCEEDANCE") can trigger termination of Wilshire's rights hereunder in
accordance with Section 8.17(c). The "Standard" levels
D-4
set forth in Table 1 above are guidelines for appropriate servicing levels,
violations of which will not trigger termination.
DEFINITIONS FOR PERFORMANCE STANDARDS
ABANDONMENT RATE The percentage of total incoming calls to the customer service
area which are not directed to the automated telephony response system in which
the customer terminates the call prior to connection with a customer service
representative.
ATTEMPT shall include, at a minimum, an actual dialing of an outbound call to
the borrower's telephone number.
AVERAGE CALL PICK-UP TIME The average number of seconds that a customer, other
than those that select the automated telephony response system, are on hold
prior to speaking to a customer service representative.
COLLECTION CALLS - FIRST 15 DAYS OF DELINQUENCY These calls are made for all
mortgage loans that are past due and have broken a Promise to Pay between the
first and 15th day of delinquency, except for loans that are screened out from
such calls for reasons including, but not limited to: bankruptcies, interim
payments in the first 30 days after transfer, loans for which borrowers have
requested in writing that Wilshire not contact them and early indicator scoring
exclusions. On initial contact for a second lien account, Wilshire shall obtain
senior lien information for the mortgagor. The expectation is that Wilshire will
make an Attempt every other business day.
COLLECTION CALLS - AFTER THE 15TH DAY OF DELINQUENCY BUT NOT YET IN FORECLOSURE
These calls are made for all Mortgage Loans that are delinquent and have broken
a Promise to Pay after the 15th day of delinquency, except for loans that are
screened out from such calls for reasons including, but not limited to:
bankruptcies, loans in foreclosure, loans for which borrowers have requested in
writing that Wilshire not contact them and early indicator scoring exclusions.
As applicable, the expectation is that Wilshire will make two Attempts each
business day.
FORECLOSURE TIMELINES For Mortgage Loans in foreclosure, Wilshire will, subject
to clause (ii) below, meet or improve upon the foreclosure timelines. Wilshire
will use the most recently published ▇▇▇▇▇▇▇ Mac foreclosure timelines as may be
amended from time to time. Wilshire will not be penalized with a reduction in
fees for unavoidable delays such as bankruptcy, missing documents, workouts
authorized by the residual holder, contested actions, service of process delays,
sheriff sale scheduling delays, court delays in entering judgment or scheduling
hearings, and other circumstances agreed to by the residual holder, provided
that Wilshire (i) has documented its system accordingly and (ii) upon request by
the residual holder, provide a report of such conditions, such report detailing
corrective actions taken, the date of such actions and the expected resolution
date, and demonstrating diligent time management to resolve such issues.
FORECLOSURE TIMELINE PERCENTAGE For all Mortgage Loans with a completed
foreclosure sale during the preceding month, the average across all such loans
of the ratio of the
D-5
number of days to foreclosure from the date of the foreclosure initiation
divided by the applicable ▇▇▇▇▇▇▇ Mac standard in the relevant state.
PRE-FORECLOSURE RESOLUTION shall mean any of the following:
- Reinstatement - means any defaulted mortgage loan for which the
borrower brings the Mortgage Loan back to a status no more than
60 days delinquent through a lump sum payment or otherwise
consistent with the terms of the related Servicing Agreement.
- Full payoff - means any defaulted mortgage loan which is paid in
full as defined in the Trust and Servicing Agreement.
- Cash for keys - means a defaulted mortgage loan for which the
mortgagor surrenders the property in exchange for a cash sum to
enable foreclosure on a property with imperfect title.
- Shortfall payoff - means a defaulted mortgage loan for which a
final payment in an amount less than the indebtedness owed under
the applicable mortgage note is made consistent with the terms of
the Trust and Servicing Agreement and such payment is received by
Wilshire in full satisfaction of such indebtedness.
- Deed-in-Lieu of Foreclosure - means a defaulted mortgage loan for
which title to the mortgaged property is taken by Wilshire
through deed in lieu of foreclosure and the resulting REO
Property is to be liquidated consistent with the terms of the
Trust and Servicing Agreement.
- Modification/Deferral (subject to REMIC restrictions) - means a
defaulted mortgage loan which is modified in a manner consistent
with the Trust and Servicing Agreement and for which the borrower
has made three consecutive payments consistent with the terms of
such mortgage loan as so modified.
- Forbearance Plan - means a defaulted mortgage loan for which a
borrower has made three consecutive payments in accordance with a
forbearance plan entered into by the borrower.
- Take-out at Foreclosure Sale - means the mortgaged property
related to a defaulted mortgage loan that is purchased at a
foreclosure sale by a party other than Wilshire in a manner
consistent with the Trust and Servicing Agreement.
PRE-FORECLOSURE RESOLUTION RATE is calculated as the percentage of the loans (by
number) that are at least 90 days past due at the beginning of a month on which
a Pre-Foreclosure Resolution is achieved during the month divided by the sum of
such resolved loans and the number of loans that go to REO during the month.
D-6
PROMISE TO PAY is an agreement with the Obligor to make at least one full
payment within thirty days.
RECONCILED MARKET VALUE ("RMV") is the targeted sales price of a REO property.
RMV is established following an analysis by Fairbanks' in-house appraisers of
competing marketing plans and other market conditions. This analysis will
include a review of the interior Broker Price Opinions (BPOs) received from the
listing agent and an outside third party real-estate agent. This set value never
changes throughout the servicing of the REO asset and will be reflected in all
reporting.
REO SELLABLE PORTFOLIO is the entire REO portfolio less any REO in eviction,
redemption under contract or other situations in which Servicer cannot pass
marketable title.
RIGHT PARTY CONTACT RATE means a person-to-person contact with an obligor (a
signer of the Mortgage Note), or, where applicable, the obligor's legal guardian
or attorney-in-fact with respect to the loan, or other third party as appointed
by the mortgagor.
ROLL RATE is calculated as a three month rolling average percentage of loans,
based on Stated Principal Balance, that remain in the same bucket or improve
their delinquency status (including loans that payoff or are otherwise
liquidated) from previous month-end to current month-end.
TOTAL RECONCILED MARKET VALUE is the sum of all the RMVs on all the REO closings
in the month.
TOTAL SALES PRICE is the sum of the sales price of all REO closings in the
month, less any sellers' closing concessions in which the sales price was
inflated to reflect the concession amount.
D-7
Exhibit E
Form of Limited Power of Attorney
Pursuant to the Trust and Servicing Agreement (as amended, restated,
supplemented or otherwise modified from time to time, the "TSA"; capitalized
terms not defined herein have the definitions assigned to such terms in the
TSA), dated as of January 1, 2003, among GS Mortgage Securities Corp., as
depositor, Wilshire Credit Corporation, as a servicer and as master servicer,
Fairbanks Capital Corp., a Utah corporation and residential mortgage loan
servicer ("Fairbanks"), as a servicer (the "Servicer"), and JPMorgan Chase Bank,
a New York banking corporation, ("JPMorgan"), as Trustee, JPMorgan hereby
appoints [Fairbanks][Wilshire] as its true and lawful attorney-in-fact and in
its name, place and stead to take the following designated actions with respect
to any mortgage loan or real estate owned property (collectively, the "Mortgage
Loans") relating to the GSRPM Mortgage Pass-Through Certificates, Series 2003-1
and subject to the TSA:
1. To ask, demand, ▇▇▇ for, collect and receive all sums of money,
debts or other obligations of any kind with respect to a Mortgage Loan which are
now or shall after this date become due, owing or payable, or otherwise belong
to the Trustee; to settle and compromise any of such debts or obligations that
may be or become due to the Trustee; to endorse in the name of the Trustee for
deposit in the appropriate account any instrument payable to or to the order of
the Trustee; in each case with respect to a Mortgage Loan.
2. To make demand(s) on behalf of the Trustee upon any or all parties
liable on a Mortgage Loan; to declare defaults with respect to a Mortgage Loan;
to give notices of intention to accelerate to give notices of acceleration and
any other notices as Servicer deems reasonably necessary or appropriate; to post
all notices as required by law and the documents securing a Mortgage Loan in
order to foreclose such Mortgage Loan; to handle all aspects of foreclosure on
behalf of the Trustee, including, but not limited to, conducting the foreclosure
sale, bidding for the Trustee and executing all documents, including all deeds
and conveyances, needed to effect such foreclosure sale and/or liquidation; to
execute any documents or instruments necessary for the offer, listing, closing
of sale, and conveyance of REO Property, including, but not limited to, grant,
warranty, quit claim and statutory deeds or similar instruments of conveyance;
to execute any documents or instruments in connection with any bankruptcy or
receivorship of a mortgagor on a Mortgage Loan; to file suit and prosecute legal
actions against all parties liable for amounts due under a Mortgage Loan,
including but not limited to any deficiency amounts due following foreclosure;
to take such other actions and exercise such rights which may be taken by
Trustee under the terms of any Mortgage Loan, including, but not limited to,
satisfaction, release, cancellation or discharge of mortgage, eviction, unlawful
detainer, or similar dispossessory proceeding, sale, taking possession of,
release of security instruments, realization upon all or any part of a Mortgage
Loan or
E-1
any collateral therefor or guaranty thereof; and to assign, convey, accept, or
otherwise transfer Trustee's interest in any Mortgage Loan.
3. To perform all other acts and do all other things as may be
necessary or convenient to manage and service the Mortgage Loans under the terms
of the TSA.
This instrument is to be construed and interpreted as a Limited Power
of Attorney regarding a Mortgage Loan. The enumeration of specific items, acts,
rights and powers is not intended to, nor does it give rise to and it is not to
be construed as a general power of attorney.
The rights, powers and authority of the Servicer as attorney-in-fact of
the Trustee under this Limited Power of Attorney shall commence on the date of
execution hereof and shall remain in full force and effect as a limited and
revocable power of attorney which may be revoked at any time in writing by the
Trustee.
This Limited Power of Attorney shall be governed by and construed in
accordance with the laws of the State of New York.
IN WITNESS WHEREOF the Trustee has hereunto caused this Limited Power
of Attorney to be executed by its duly authorized representatives on this _____
day of January, 2003.
JPMorgan Chase Bank
By: ________________________
Name:
Title:
WITNESS: WITNESS:
By: ________________________ By: ______________________
Name: Name:
Title: Title:
▇-▇
▇▇▇▇▇ ▇▇ ▇▇▇ ▇▇▇▇ )
) ▇▇
▇▇▇▇▇▇ ▇▇ ▇▇▇ ▇▇▇▇ )
On January ____, 2003, before me personally appeared
_____________________, known to me to be a ________________________ of JPMorgan
Chase Bank, the New York banking association that executed the preceding Limited
Power of Attorney and also known to me to be the person who executed it on
behalf of said New York banking association, and acknowledged to me that such
New York banking association executed the preceding Limited Power of Attorney.
IN WITNESS WHEREOF, I have hereunto set my hand and affixed my official
seal the year and day in this certificate first written.
__________________________________
Notary Public
[NOTARIAL SEAL]
E-3
Exhibit F
FORM OF INITIAL CERTIFICATION
[This Certification is maintained by the Trustee at the Corporate Trust Office.]
F-1
Exhibit G
RESIDUAL TRANSFER AFFIDAVIT
GSRPM Mortgage Loan Trust 2003-1,
Mortgage Pass-Through Certificates, Series 2003-1
STATE OF )
) ss.:
COUNTY OF )
The undersigned, being first duly sworn, deposes and says as
follows:
1. The undersigned is an officer of ___________________, the
proposed Transferee of an Ownership Interest in a Residual Certificate (the
"CERTIFICATE") issued pursuant to the Trust and Servicing Agreement (the
"Agreement"), by and among GS Mortgage Securities Corp., as depositor (the
"DEPOSITOR"), Fairbanks Capital Corporation, as a servicer (a "SERVICER"),
Wilshire Credit Corporation, as a servicer (a "SERVICER") and as master servicer
(the "MASTER SERVICER") and JPMorgan Chase Bank, as Trustee. Capitalized terms
used, but not defined herein or in Exhibit 1 hereto, shall have the meanings
ascribed to such terms in the Agreement. The Transferee has authorized the
undersigned to make this affidavit on behalf of the Transferee for the benefit
of the Depositor and the Trustee.
2. The Transferee is, as of the date hereof, and will be, as
of the date of the Transfer, a Permitted Transferee. The Transferee is acquiring
its Ownership Interest in the Certificate for its own account. The Transferee
has no knowledge that any such affidavit is false.
3. The Transferee has been advised of, and understands that
(i) a tax will be imposed on Transfers of the Certificate to Persons that are
not Permitted Transferees; (ii) such tax will be imposed on the transferor, or,
if such Transfer is through an agent (which includes a broker, nominee or
middleman) for a Person that is not a Permitted Transferee, on the agent; and
(iii) the Person otherwise liable for the tax shall be relieved of liability for
the tax if the subsequent Transferee furnished to such Person an affidavit that
such subsequent Transferee is a Permitted Transferee and, at the time of
Transfer, such Person does not have actual knowledge that the affidavit is
false.
4. The Transferee has been advised of, and understands that a
tax will be imposed on a "pass-through entity" holding the Certificate if at any
time during the taxable year of the pass-through entity a Person that is not a
Permitted Transferee is the record holder of an interest in such entity. The
Transferee understands that such tax will not be imposed for any period with
respect to which the record holder furnishes to the pass-through entity an
affidavit that such record holder is a Permitted Transferee and the pass-through
entity does not have actual knowledge that such affidavit is false. (For this
purpose, a "pass-through entity" includes a regulated investment company, a real
estate investment trust or common trust fund, a
G-1
partnership, trust or estate, and certain cooperatives and, except as may be
provided in Treasury Regulations, persons holding interests in pass-through
entities as a nominee for another Person.)
5. The Transferee has reviewed the provisions of Section
5.02(c) of the Agreement and understands the legal consequences of the
acquisition of an Ownership Interest in the Certificate including, without
limitation, the restrictions on subsequent Transfers and the provisions
regarding voiding the Transfer and mandatory sales. The Transferee expressly
agrees to be bound by and to abide by the provisions of Section 5.02(c) of the
Agreement and the restrictions noted on the face of the Certificate. The
Transferee understands and agrees that any breach of any of the representations
included herein shall render the Transfer to the Transferee contemplated hereby
null and void.
6. The Transferee agrees to require a Transfer Affidavit from
any Person to whom the Transferee attempts to Transfer its Ownership Interest in
the Certificate, and in connection with any Transfer by a Person for whom the
Transferee is acting as nominee, trustee or agent, and the Transferee will not
Transfer its Ownership Interest or cause any Ownership Interest to be
Transferred to any Person that the Transferee knows is not a Permitted
Transferee. In connection with any such Transfer by the Transferee, the
Transferee agrees to deliver to the Trustee a certificate substantially in the
form set forth as Exhibit H to the Agreement (a "TRANSFEROR Certificate") to the
effect that such Transferee has no actual knowledge that the Person to which the
Transfer is to be made is not a Permitted Transferee.
7. The Transferee has historically paid its debts as they have
come due, intends to pay its debts as they come due in the future, and
understands that the taxes payable with respect to the Certificate may exceed
the cash flow with respect thereto in some or all periods and intends to pay
such taxes as they become due. The Transferee does not have the intention to
impede the assessment or collection of any tax legally required to be paid with
respect to the Certificate.
8. The Transferee's taxpayer identification number is
__________.
9. The Transferee is a U.S. Person as defined in Code Section
7701(a)(30).
10. The Transferee is aware that the Certificate may be a
"noneconomic residual interest" within the meaning of proposed Treasury
regulations promulgated pursuant to the Code and that the transferor of a
noneconomic residual interest will remain liable for any taxes due with respect
to the income on such residual interest, unless no significant purpose of the
transfer was to impede the assessment or collection of tax.
11. The Transferee will not cause income from the Certificate
to be attributable to a foreign permanent establishment or fixed base, within
the meaning of an applicable income tax treaty, of the Transferee or any other
U.S. person.
12. Check one of the following:
| | The present value of the anticipated tax liabilities
associated with holding the Certificate, as applicable, does not exceed the sum
of:
G-2
(i) the present value of any consideration given to the
Transferee to acquire such Certificate;
(ii) the present value of the expected future
distributions on such Certificate; and
(iii) the present value of the anticipated tax savings
associated with holding such Certificate as the
related REMIC generates losses.
For purposes of this calculation, (i) the Transferee is
assumed to pay tax at the highest rate currently specified in Section 11(b) of
the Code (but the tax rate in Section 55(b)(1)(B) of the Code may be used in
lieu of the highest rate specified in Section 11(b) of the Code if the
Transferee has been subject to the alternative minimum tax under Section 55 of
the Code in the preceding two years and will compute its taxable income in the
current taxable year using the alternative minimum tax rate) and (ii) present
values are computed using a discount rate equal to the short-term Federal rate
prescribed by Section 1274(d) of the Code for the month of the transfer and the
compounding period used by the Transferee.
| | The transfer of the Certificate complies with U.S.
Treasury Regulations Sections 1.860E-1(c)(5) and (6) and, accordingly,
(i) the Transferee is an "eligible corporation," as
defined in U.S. Treasury Regulations Section
1.860E-1(c)(6)(i), as to which income from the
Certificate will only be taxed in the United States;
(ii) at the time of the transfer, and at the close of the
Transferee's two fiscal years preceding the year of
the transfer, the Transferee had gross assets for
financial reporting purposes (excluding any
obligation of a person related to the Transferee
within the meaning of U.S. Treasury Regulations
Section 1.860E-1(c)(6)(ii)) in excess of $100 million
and net assets in excess of $10 million;
(iii) the Transferee will transfer the Certificate only to
another "eligible corporation," as defined in U.S.
Treasury Regulations Section 1.860E-1(c)(6)(i), in a
transaction that satisfies the requirements of
Sections 1.860E-1(c)(4)(i), (ii) and (iii) and
Section 1.860E-1(c)(5) of the U.S. Treasury
Regulations; and
(iv) the Transferee determined the consideration paid to
it to acquire the Certificate based on reasonable
market assumptions (including, but not limited to,
borrowing and investment rates, prepayment and loss
assumptions, expense and reinvestment assumptions,
tax rates and other factors specific to the
Transferee) that it has determined in good faith.
| | None of the above.
G-3
13. The Transferee is not an employee benefit plan that is
subject to ERISA or a plan that is subject to Section 4975 of the Code and the
Transferee is not acting on behalf of or investing plan assets of such an
employee benefit plan.
G-4
IN WITNESS WHEREOF, the Transferee has caused this instrument
to be executed on its behalf, pursuant to authority of its Board of Directors,
by its duly authorized officer and its corporate seal to be hereunto affixed,
duly attested, this day of , 20 .
___________________________________
Print Name of Transferee
By:________________________________
Name:
Title:
[Corporate Seal]
ATTEST:
____________________________________
[Assistant] Secretary
Personally appeared before me the above-named __________,
known or proved to me to be the same person who executed the foregoing
instrument and to be the ___________ of the Transferee, and acknowledged that he
executed the same as his free act and deed and the free act and deed of the
Transferee.
Subscribed and sworn before me this ____ day of _________,
20__.
________________________________
NOTARY PUBLIC
My Commission expires the __ day
of _________, 20__
G-5
EXHIBIT H
FORM OF TRANSFEROR CERTIFICATE
__________, 20__
GS Mortgage Securities Corp.
▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇
Attention:
JPMorgan Chase Bank, as Trustee
▇ ▇▇▇ ▇▇▇▇ ▇▇▇▇▇, ▇▇▇ ▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇
Attention: Institutional Trust Services/Structured Finance Services; GSRPM
Mortgage Pass-Through Certificates, Series 2003-1
GSRPM MORTGAGE LOAN TRUST 2003-1, MORTGAGE PASS-THROUGH CERTIFICATES,
SERIES 2003-1 CLASS [ ]
Ladies and Gentlemen:
In connection with our disposition of the above Certificates
we certify that (a) we understand that the Certificates have not been registered
under the Securities Act of 1933, as amended (the "ACT"), and are being disposed
by us in a transaction that is exempt from the registration requirements of the
Act, (b) we have not offered or sold any Certificates to, or solicited offers to
buy any Certificates from, any person, or otherwise approached or negotiated
with any person with respect thereto, in a manner that would be deemed, or taken
any other action which would result in, a violation of Section 5 of the Act and
(c) to the extent we are disposing of a Residual Certificate, (A) we have no
knowledge the Transferee is not a Permitted Transferee and (B) after conducting
a reasonable investigation of the financial condition of the Transferee, we have
no knowledge and no reason to believe that the statements made in paragraphs 7,
10 and 11 of the Transferee's Residual Transfer Affidavit are false.
Very truly yours,
Print Name of Transferor
By:__________________________________
Authorized Officer
H-1
EXHIBIT I
FORM OF RULE 144A LETTER
____________, 20__
GS Mortgage Securities Corp.
▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇
Attention:
JPMorgan Chase Bank, as Trustee
▇ ▇▇▇ ▇▇▇▇ ▇▇▇▇▇, ▇▇▇ ▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇
Attention: Institutional Trust Services/Structured Finance Services; GSRPM
Mortgage Pass-Through Certificates, Series 2003-1
GSRPM MORTGAGE LOAN TRUST 2003-1, MORTGAGE PASS-THROUGH CERTIFICATES,
SERIES 2003-1 CLASS [ ]
Ladies and Gentlemen:
In connection with our acquisition of the above Certificates
we certify that (a) we understand that the Certificates are not being registered
under the Securities Act of 1933, as amended (the "ACT"), or any state
securities laws and are being transferred to us in a transaction that is exempt
from the registration requirements of the Act and any such laws, (b) we have
such knowledge and experience in financial and business matters that we are
capable of evaluating the merits and risks of investments in the Certificates,
(c) we have had the opportunity to ask questions of and receive answers from the
Depositor concerning the purchase of the Certificates and all matters relating
thereto or any additional information deemed necessary to our decision to
purchase the Certificates, (d) we are not an employee benefit plan that is
subject to the Employee Retirement Income Security Act of 1974, as amended
("ERISA"), or a plan or arrangement that is subject to Section 4975 of the
Internal Revenue Code of 1986, as amended (the "CODE"), nor are we acting on
behalf of any such plan or arrangement nor using the assets of any such plan or
arrangement to effect such acquisition, (e) we have not, nor has anyone acting
on our behalf offered, transferred, pledged, sold or otherwise disposed of the
Certificates, any interest in the Certificates or any other similar security to,
or solicited any offer to buy or accept a transfer, pledge or other disposition
of the Certificates, any interest in the Certificates or any other similar
security from, or otherwise approached or negotiated with respect to the
Certificates, any interest in the Certificates or any other similar security
with, any person in any manner, or made any general solicitation by means of
general advertising or in any other manner, or taken any other action, that
would
I-1
constitute a distribution of the Certificates under the Securities Act or that
would render the disposition of the Certificates a violation of Section 5 of the
Securities Act or require registration pursuant thereto, nor will act, nor has
authorized or will authorize any person to act, in such manner with respect to
the Certificates, and (f) we are a "qualified institutional buyer" as that term
is defined in Rule 144A under the Securities Act and have completed either of
the forms of certification to that effect attached hereto as Annex 1 or Annex 2.
We are aware that the sale to us is being made in reliance on Rule 144A. We are
acquiring the Certificates for our own account or for resale pursuant to Rule
144A and further, understand that such Certificates may be resold, pledged or
transferred only (i) to a person reasonably believed to be a qualified
institutional buyer that purchases for its own account or for the account of a
qualified institutional buyer to whom notice is given that the resale, pledge or
transfer is being made in reliance on Rule 144A, or (ii) pursuant to another
exemption from registration under the Securities Act.
I-2
ANNEX 1 TO EXHIBIT I
--------------------
QUALIFIED INSTITUTIONAL BUYER STATUS UNDER SEC RULE 144A
--------------------------------------------------------
[For Transferees Other Than Registered Investment Companies]
The undersigned (the "BUYER") hereby certifies as follows to
the parties listed in the Rule 144A Transferee Certificate to which this
certification relates with respect to the Certificates described therein:
1. As indicated below, the undersigned is the President, Chief
Financial Officer, Senior Vice President or other executive officer of the
Buyer.
2. In connection with purchases by the Buyer, the Buyer is a
"qualified institutional buyer" as that term is defined in Rule 144A under the
Securities Act of 1933, as amended ("RULE 144A"), because (i) the Buyer owned
and/or invested on a discretionary basis $ 8 in securities (except for the
excluded securities referred to below) as of the end of the Buyer's most recent
fiscal year (such amount being calculated in accordance with Rule 144A and (ii)
the Buyer satisfies the criteria in the category marked below.
____ CORPORATION, ETC. The Buyer is a corporation (other
than a bank, savings and loan association or similar
institution), Massachusetts or similar business
trust, partnership, or charitable organization
described in Section 501(c)(3) of the Internal
Revenue Code of 1986, as amended.
____ BANK. The Buyer (a) is a national bank or banking
institution organized under the laws of any State,
territory or the District of Columbia, the business
of which is substantially confined to banking and is
supervised by the State or territorial banking
commission or similar official or is a foreign bank
or equivalent institution, and (b) has an audited net
worth of at least $25,000,000 as demonstrated in its
latest annual financial statements, A COPY OF WHICH
IS ATTACHED HERETO.
____ SAVINGS AND LOAN. The Buyer (a) is a savings and loan
association, building and loan association,
cooperative bank, homestead association or similar
institution, which is supervised and examined by a
State or Federal authority having supervision over
any such institutions or is a foreign savings and
loan association or equivalent institution and (b)
has an audited net worth of at least
----------
8 Buyer must own and/or invest on a discretionary basis at least
$100,000,000 in securities unless Buyer is a dealer, and, in that case,
Buyer must own and/or invest on a discretionary basis at least
$10,000,000 in securities.
I-3
$25,000,000 as demonstrated in its latest annual
financial statements, A COPY OF WHICH IS ATTACHED
HERETO.
____ BROKER-DEALER. The Buyer is a dealer registered
pursuant to Section 15 of the Securities Exchange Act
of 1934.
____ INSURANCE COMPANY. The Buyer is an insurance company
whose primary and predominant business activity is
the writing of insurance or the reinsuring of risks
underwritten by insurance companies and which is
subject to supervision by the insurance commissioner
or a similar official or agency of a State, territory
or the District of Columbia.
____ STATE OR LOCAL PLAN. The Buyer is a plan established
and maintained by a State, its political
subdivisions, or any agency or instrumentality of the
State or its political subdivisions, for the benefit
of its employees.
____ ERISA PLAN. The Buyer is an employee benefit plan
within the meaning of Title I of the Employee
Retirement Income Security Act of 1974.
____ INVESTMENT ADVISOR. The Buyer is an investment
advisor registered under the Investment Advisors Act
of 1940.
____ SMALL BUSINESS INVESTMENT COMPANY. Buyer is a small
business investment company licensed by the U.S.
Small Business Administration under Section 301(c) or
(d) of the Small Business Investment Act of 1958.
____ BUSINESS DEVELOPMENT COMPANY. Buyer is a business
development company as defined in Section 202(a)(22)
of the Investment Advisors Act of 1940.
3. The term "SECURITIES" as used herein DOES NOT INCLUDE (i)
securities of issuers that are affiliated with the Buyer, (ii) securities that
are part of an unsold allotment to or subscription by the Buyer, if the Buyer is
a dealer, (iii) securities issued or guaranteed by the U.S. or any
instrumentality thereof, (iv) bank deposit notes and certificates of deposit,
(v) loan participations, (vi) repurchase agreements, (vii) securities owned but
subject to a repurchase agreement and (viii) currency, interest rate and
commodity swaps.
4. For purposes of determining the aggregate amount of
securities owned and/or invested on a discretionary basis by the Buyer, the
Buyer used the cost of such securities to the Buyer and did not include any of
the securities referred to in the preceding paragraph, except (i) where the
Buyer reports its securities holdings in its financial statements on the basis
of their market value, and (ii) no current information
I-4
with respect to the cost of those securities has been published. If clause (ii)
in the preceding sentence applies, the securities may be valued at market.
Further, in determining such aggregate amount, the Buyer may have included
securities owned by subsidiaries of the Buyer, but only if such subsidiaries are
consolidated with the Buyer in its financial statements prepared in accordance
with generally accepted accounting principles and if the investments of such
subsidiaries are managed under the Buyer's direction. However, such securities
were not included if the Buyer is a majority-owned, consolidated subsidiary of
another enterprise and the Buyer is not itself a reporting company under the
Securities Exchange Act of 1934, as amended.
5. The Buyer acknowledges that it is familiar with Rule 144A
and understands that the seller to it and other parties related to the
Certificates are relying and will continue to rely on the statements made herein
because one or more sales to the Buyer may be in reliance on Rule 144A.
6. Until the date of purchase of the Rule 144A Securities, the
Buyer will notify each of the parties to which this certification is made of any
changes in the information and conclusions herein. Until such notice is given,
the Buyer's purchase of the Certificates will constitute a reaffirmation of this
certification as of the date of such purchase. In addition, if the Buyer is a
bank or savings and loan is provided above, the Buyer agrees that it will
furnish to such parties updated annual financial statements promptly after they
become available.
______________________________________
Print Name of Transferor
By:___________________________________
Name:
Title:
Date:_________________________________
I-5
ANNEX 2 TO EXHIBIT I
--------------------
QUALIFIED INSTITUTIONAL BUYER STATUS UNDER SEC RULE 144A
--------------------------------------------------------
[For Transferees That are Registered Investment Companies]
The undersigned (the "BUYER") hereby certifies as follows to the
parties listed in the Rule 144A Transferee Certificate to which this
certification relates with respect to the Certificates described therein:
1. As indicated below, the undersigned is the President, Chief
Financial Officer or Senior Vice President of the Buyer or, if the Buyer is a
"qualified institutional buyer" as that term is defined in Rule 144A under the
Securities Act of 1933, as amended ("RULE 144A"), because Buyer is part of a
Family of Investment Companies (as defined below), is such an officer of the
Adviser.
2. In connection with purchases by Buyer, the Buyer is a "qualified
institutional buyer" as defined in SEC Rule 144A because (i) the Buyer is an
investment company registered under the Investment Company Act of 1940, as
amended and (ii) as marked below, the Buyer alone, or the Buyer's Family of
Investment Companies, owned at least $100,000,000 in securities (other than the
excluded securities referred to below) as of the end of the Buyer's most recent
fiscal year. For purposes of determining the amount of securities owned by the
Buyer or the Buyer's Family of Investment Companies, the cost of such securities
was used, except (i) where the Buyer or the Buyer's Family of Investment
Companies reports its securities holdings in its financial statements on the
basis of their market value, and (ii) no current information with respect to the
cost of those securities has been published. If clause (ii) in the preceding
sentence applies, the securities may be valued at market.
____ The Buyer owned $ in securities (other than the
excluded securities referred to below) as of the end
of the Buyer's most recent fiscal year (such amount
being calculated in accordance with Rule 144A).
____ The Buyer is part of a Family of Investment Companies
which owned in the aggregate $ in securities (other
than the excluded securities referred to below) as of
the end of the Buyer's most recent fiscal year (such
amount being calculated in accordance with Rule
144A).
3. The term "FAMILY OF INVESTMENT COMPANIES" as used herein means two
or more registered investment companies (or series thereof) that have the same
investment adviser or investment advisers that are affiliated (by virtue of
being majority owned subsidiaries of the same parent or because one investment
adviser is a majority owned subsidiary of the other).
I-6
4. The term "SECURITIES" as used herein does not include (i) securities
of issuers that are affiliated with the Buyer or are part of the Buyer's Family
of Investment Companies, (ii) securities issued or guaranteed by the U.S. or any
instrumentality thereof, (iii) bank deposit notes and certificates of deposit,
(iv) loan participations, (v) repurchase agreements, (vi) securities owned but
subject to a repurchase agreement and (vii) currency, interest rate and
commodity swaps.
5. The Buyer is familiar with Rule 144A and understands that the
parties listed in the Rule 144A Transferee Certificate to which this
certification relates are relying and will continue to rely on the statements
made herein because one or more sales to the Buyer will be in reliance on Rule
144A. In addition, the Buyer will only purchase for the Buyer's own account.
6. Until the date of purchase of the Certificates, the undersigned will
notify the parties listed in the Rule 144A Transferee Certificate to which this
certification relates of any changes in the information and conclusions herein.
Until such notice is given, the Buyer's purchase of the Certificates will
constitute a reaffirmation of this certification by the undersigned as of the
date of such purchase.
_____________________________________
Print Name of Transferor
By:__________________________________
Name:
Title:
IF AN ADVISER:
_____________________________________
Print Name of Buyer
Date:
I-7
Exhibit J-1
[Form of Request for Release]
LOAN INFORMATION
Name of Mortgagor:_____________________________________________
Servicer
Loan No.:______________________________________________________
TRUSTEE
Name: JPMORGAN CHASE BANK
----------------------------------------------------------
Address:-________________________________________, NEW YORK, NEW YORK
Custodian/Trustee
Mortgage File No.:______________________________________________________
Certificates: GSRPM Mortgage Pass-Through Certificates, Series 2003-1
We the undersigned, as a Servicer, hereby acknowledges that it
has received from JPMorgan Chase Bank, as trustee (the "TRUSTEE") for the
Holders of GSRPM Mortgage Pass-Through Certificates, Series 2003-1, the
documents referred to below (the "DOCUMENTS"). All capitalized terms not
otherwise defined in this Request for Release shall have the meanings given them
in the Trust and Servicing Agreement dated as of January 1, 2003, among GS
Mortgage Securities Corp., as depositor, Fairbanks Capital Corp., as a Servicer,
Wilshire Credit Corporation, as a Servicer and Master Servicer and JPMorgan
Chase Bank, as Trustee (the "TRUST AND SERVICING AGREEMENT").
Documents
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[Servicer to identify documents with particularity below]
[Fairbanks] [Wilshire] hereby acknowledges and agrees as
follows:
(1) [Fairbanks] [Wilshire] shall hold and retain possession of
the Documents in trust for the benefit of the Trustee, solely for the purposes
provided in the Trust and Servicing Agreement.
(2) [Fairbanks] [Wilshire] shall not cause or permit the
Documents to become subject to, or encumbered by, any claim, liens, security
interest, charges, writs of
J-1-1
attachment or other impositions nor shall [Fairbanks] [Wilshire] assert or seek
to assert any claims or rights of set-off to or against the Documents or any
proceeds thereof.
(3) [Fairbanks] [Wilshire] shall return the Documents to the
Trustee when the need therefor no longer exists, unless the Mortgage Loan
relating to the Documents has been liquidated and the proceeds thereof have been
remitted to the related Collection Account and except as expressly provided in
the Trust and Servicing Agreement.
(4) The Documents and any proceeds thereof, including any
proceeds of proceeds, coming into the possession or control of [Fairbanks]
[Wilshire] shall at all times be earmarked for the account of the Trustee, and
[Fairbanks] [Wilshire] shall keep the Documents and any proceeds separate and
distinct from all other property in the possession, custody or control of
[Fairbanks] [Wilshire].
[Fairbanks Capital Corp.]
[wilshire credit corporation]
By: ___________________________________
Name:___________________________________
Title:__________________________________
Date: _________
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Paperless Release Template
Loan Number Pool Doc Code Release Alternate Requested Attention Ship to Ship to Ship to Ship to
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EXHIBIT K
FORM CERTIFICATION TO BE
PROVIDED WITH FORM 10-K
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GSRPM Mortgage Loan Trust 2003-1 (the "Trust")
Mortgage Pass-Through Certificates
Series 2003-1
I, [identify the certifying individual], certify that:
I have reviewed this annual report on Form 10-K, and all reports on Form 8-K
containing distribution date reports filed in respect of periods included in the
year covered by this annual report, of the Trust;
Based on my knowledge, the information in these reports, taken as a whole, does
not contain any untrue statement of a material fact or omit to state a material
fact necessary to make the statements made, in light of the circumstances under
which such statements were made, not misleading as of the last day of the period
covered by this annual report;
Based on my knowledge, the servicing information required to be provided to the
trustee by the related servicer under the trust and servicing agreement is
included in these reports;
I am responsible for reviewing the activities performed by the related servicer
under the trust and servicing agreement and based upon the review required under
the trust and servicing agreement, and except as disclosed in the report, the
related servicer has fulfilled its obligations under the trust and servicing
agreement; and
I have disclosed to the related servicer's certified public accountants all
significant deficiencies relating to the related servicer's compliance with the
minimum servicing standards in accordance with a review conducted in compliance
with the Uniform Single Attestation Program for Mortgage Bankers or similar
standard as set forth in the trust and servicing agreement.
Date: _________________________
_______________________________
[Signature]
[Title]
K-1
EXHIBIT L-1
FORM OF CERTIFICATION TO BE PROVIDED TO THE DEPOSITOR
BY THE TRUSTEE
[Depositor Address]
Re: GSRPM Mortgage Pass-Through Certificates, Series 2003-1
Reference is made to the Trust and Servicing Agreement, dated as of
January 1, 2003 (the "Trust and Servicing Agreement"), by and among JPMorgan
Chase Bank (the "Trustee"), Fairbanks Capital Corp., as a Servicer, Wilshire
Credit Corp., as a Servicer and as Master Servicer and GS Mortgage Securities
Corp., as Depositor. The Trustee hereby certifies to the Depositor, and its
officers, directors and affiliates, and with the knowledge and intent that they
will rely upon this certification, that:
(i) The Trustee has reviewed the annual report on Form 10-K for
the fiscal year [ ], and all reports on Form 8-K containing
distribution reports filed in respect of periods included in
the year covered by that annual report, relating to the
above-referenced trust;
(ii) Subject to paragraph (iv), the distribution information in the
distribution reports contained in all Monthly Form 8-K's
included in the year covered by the annual report on Form 10-K
for the calendar year [___], taken as a whole, does not
contain any untrue statement of a material fact or omit to
state a material fact required by the Trust and Servicing
Agreement to be included therein and necessary to make the
statements made, in light of the circumstances under which
such statements were made, not misleading as of the last day
of the period covered by that annual report;
(iii) The distribution information required to be provided by the
Trustee under the Trust and Servicing Agreement is included in
these reports.
(iv) In compiling the distribution information and making the
foregoing certifications, the Trustee has relied upon
information furnished to it by the Servicers under the Trust
and Servicing Agreement. The Trustee shall have no
responsibility or liability for any inaccuracy in such reports
resulting from information so provided by the Servicers.
Date:
JPMORGAN CHASE BANK, as Trustee
By: ____________________________
Name: ____________________________
Title: ____________________________
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FORM OF CERTIFICATION TO BE
PROVIDED TO DEPOSITOR
GSRPM Mortgage Loan Trust 2003-1 (the "TRUST")
Mortgage Pass-Through Certificates
Series 2003-1
I, [identify the certifying individual], certify to GS Mortgage
Securities Corp., and [its] officers, directors and affiliates, and with the
knowledge and intent that they will rely upon this certification, that:
1. I am responsible for reviewing the activities performed by the
servicer under the trust and servicing agreement and based
upon the review required under the trust and servicing
agreement, and except as disclosed in the report, the servicer
has fulfilled its obligations under the trust and servicing
agreement; and
2. I have disclosed to the servicer's certified public
accountants all significant deficiencies relating to the
servicer's compliance with the minimum servicing standards in
accordance with a review conducted in compliance with the
Uniform Single Attestation Program for Mortgage Bankers or
similar standard as set forth in the trust and servicing
agreement.
Date: _________________________
_______________________________
[Signature]
[Title]
L-2
EXHIBIT M
SALE AGREEMENTS
M-1
EXHIBIT N
WILSHIRE HOEPA CALCULATION
Wilshire will add all fees shown on the Section 32 disclosure except for the
following fees if (a) the HUD statement shows that such fees were not paid to
the creditor or affiliate thereof and (b) Wilshire in its discretion believes
such third party fees are not unreasonable:
Appraisal Fee
Credit Report Fee
Doc Prep Fee
Document Stamp Fee
Intangible Tax
Other Tax
Title Report
Title Examination Fee
Notary Fee
Recording Fees
Title Insurance
Other