Exhibit 4.1
EXECUTION COPY
▇▇▇▇▇▇ ▇▇▇▇▇▇▇ ABS CAPITAL I INC.,
Depositor,
[___________________________________],
Servicer,
[_______________________________________],
Servicer,
[__________________________________],
Responsible Party,
and
[___________________________________________],
Trustee
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POOLING AND SERVICING AGREEMENT
Dated as of [___________], 2006
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▇▇▇▇▇▇ ▇▇▇▇▇▇▇ ABS CAPITAL I INC. TRUST 2006-[__]
MORTGAGE PASS-THROUGH CERTIFICATES,
SERIES 2006-[___]
TABLE OF CONTENTS
Page
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ARTICLE I
DEFINITIONS
ARTICLE II
CONVEYANCE OF MORTGAGE LOANS;
REPRESENTATIONS AND WARRANTIES
Section 2.01 Conveyance of Mortgage Loans..................................51
Section 2.02 Acceptance by the Trustee of the Mortgage Loans...............54
Section 2.03 Representations and Warranties; Remedies for Breaches of
Representations and Warranties with Respect to the
Mortgage Loans...............................................55
Section 2.04 Execution and Delivery of Certificates........................58
Section 2.05 REMIC Matters.................................................58
Section 2.06 Representations and Warranties of the Depositor...............58
ARTICLE III
ADMINISTRATION AND SERVICING
OF MORTGAGE LOANS
Section 3.01 Servicers to Service Mortgage Loans...........................60
Section 3.02 Subservicing Agreements between a Servicer and Subservicers...62
Section 3.03 Successor Subservicers........................................64
Section 3.04 Liability of the Servicers....................................64
Section 3.05 No Contractual Relationship between Subservicers and the
Trustee......................................................65
Section 3.06 Assumption or Termination of Subservicing Agreements by
Trustee......................................................65
Section 3.07 Collection of Certain Mortgage Loan Payments..................66
Section 3.08 Subservicing Accounts.........................................68
Section 3.09 Collection of Taxes, Assessments and Similar Items; Escrow
Accounts.....................................................69
Section 3.10 Collection Accounts...........................................69
Section 3.11 Withdrawals from the Collection Accounts......................71
Section 3.12 Investment of Funds in the Collection Accounts and the
Distribution Account.........................................72
Section 3.13 Maintenance of Hazard Insurance and Errors and Omissions
and Fidelity Coverage........................................74
Section 3.14 Enforcement of "Due-on-Sale" Clauses; Assumption Agreements...76
Section 3.15 Realization upon Defaulted Mortgage Loans.....................76
Section 3.16 Release of Mortgage Files.....................................78
Section 3.17 Title, Conservation and Disposition of REO Property...........79
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Section 3.18 Notification of Adjustments...................................81
Section 3.19 Access to Certain Documentation and Information Regarding
the Mortgage Loans...........................................81
Section 3.20 Documents, Records and Funds in Possession of the Servicers
to Be Held for the Trustee...................................82
Section 3.21 Servicing Compensation........................................82
Section 3.22 Annual Statement as to Compliance.............................83
Section 3.23 Annual Reports on Assessment of Compliance with Servicing
Criteria; Annual Independent Public Accountants'
Attestation Report...........................................83
Section 3.24 Trustee to Act as Servicer....................................85
Section 3.25 Compensating Interest.........................................86
Section 3.26 Credit Reporting; ▇▇▇▇▇-▇▇▇▇▇-▇▇▇▇▇▇ Act......................86
ARTICLE IV
DISTRIBUTIONS AND
ADVANCES BY THE SERVICERS
Section 4.01 Advances......................................................86
Section 4.02 Priorities of Distribution....................................87
Section 4.03 Monthly Statements to Certificateholders......................93
Section 4.04 Certain Matters Relating to the Determination of LIBOR........98
Section 4.05 Allocation of Applied Realized Loss Amounts...................98
Section 4.06 Swap Account..................................................98
ARTICLE V
THE CERTIFICATES
Section 5.01 The Certificates.............................................101
Section 5.02 Certificate Register; Registration of Transfer and Exchange of
Certificates................................................102
Section 5.03 Mutilated, Destroyed, Lost or Stolen Certificates............107
Section 5.04 Persons Deemed Owners........................................107
Section 5.05 Access to List of Certificateholders' Names and Addresses....107
Section 5.06 Maintenance of Office or Agency..............................108
ARTICLE VI
THE DEPOSITOR AND THE SERVICERS
Section 6.01 Respective Liabilities of the Depositor and the Servicers.....108
Section 6.02 Merger or Consolidation of the Depositor or a Servicer........108
Section 6.03 Limitation on Liability of the Depositor, the Servicers and
Others.......................................................109
Section 6.04 Limitation on Resignation of a Servicer.......................109
Section 6.05 Additional Indemnification by the Servicers; Third Party
Claims.......................................................110
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ARTICLE VII
DEFAULT
Section 7.01 Events of Default............................................111
Section 7.02 Trustee to Act; Appointment of Successor.....................113
Section 7.03 Notification to Certificateholders...........................114
ARTICLE VIII
CONCERNING THE TRUSTEE
Section 8.01 Duties of the Trustee........................................114
Section 8.02 Certain Matters Affecting the Trustee........................116
Section 8.03 Trustee Not Liable for Certificates or Mortgage Loans........117
Section 8.04 Trustee May Own Certificates.................................117
Section 8.05 Trustee's Fees and Expenses..................................117
Section 8.06 Eligibility Requirements for the Trustee.....................118
Section 8.07 Resignation and Removal of the Trustee.......................118
Section 8.08 Successor Trustee............................................119
Section 8.09 Merger or Consolidation of the Trustee.......................120
Section 8.10 Appointment of Co-Trustee or Separate Trustee................120
Section 8.11 Tax Matters..................................................121
Section 8.12 Periodic Filings.............................................124
Section 8.13 Tax Treatment of Upper-Tier Carry Forward Amounts, Basis Risk
Carry Forward Amounts and Class IO Shortfalls; Tax
Classification of the Excess Reserve Fund Account, Swap Account
and the Interest Rate Swap Agreement........................130
ARTICLE IX
TERMINATION
Section 9.01 Termination upon Liquidation or Purchase of the Mortgage
Loans.......................................................131
Section 9.02 Final Distribution on the Certificates.......................131
Section 9.03 Additional Termination Requirements..........................133
ARTICLE X
MISCELLANEOUS PROVISIONS
Section 10.01 Amendment....................................................133
Section 10.02 Recordation of Agreement; Counterparts.......................135
Section 10.03 Governing Law................................................135
Section 10.04 Intention of Parties.........................................135
Section 10.05 Notices......................................................136
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Section 10.06 Severability of Provisions...................................137
Section 10.07 Assignment; Sales; Advance Facilities........................137
Section 10.08 Limitation on Rights of Certificateholders...................138
Section 10.09 Inspection and Audit Rights..................................139
Section 10.10 Certificates Nonassessable and Fully Paid....................139
Section 10.11 Rule of Construction.........................................140
Section 10.12 Waiver of Jury Trial.........................................140
Section 10.13 Rights of the Swap Provider..................................140
Section 10.14 Regulation AB Compliance; Intent of the Parties;
Reasonableness..............................................140
SCHEDULES
Schedule I Mortgage Loan Schedule
Schedule II Representations and Warranties of [_______], as Servicer
Schedule III Representations and Warranties as to the Mortgage Loans
Schedule IV Representations and Warranties of [__________________], as
Servicer
Schedule V Representations and Warranties of ▇▇▇▇▇▇ ▇▇▇▇▇▇▇ ABS Capital I
Inc. as to the Mortgage Loans
Schedule VI Representations and Warranties of [_________], as Servicer
EXHIBITS
Exhibit A Form of Class A, Class M and Class B Certificate
Exhibit B Form of Class P Certificate
Exhibit C Form of Class R Certificate
Exhibit D Form of Class X Certificate
Exhibit E Form of Initial Certification of Trustee
Exhibit F Form of Document Certification and Exception Report of Trustee
Exhibit G Form of Residual Transfer Affidavit
Exhibit H Form of Transferor Certificate
Exhibit I Form of Rule 144A Letter
Exhibit J Form of Request for Release
Exhibit K Form of Contents for Each Mortgage File
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Exhibit L Form of Certification to be provided with Form 10-K
Exhibit M Form of Certification to be provided by the Trustee to be provided
to Depositor
Exhibit N Form of Certification of the Servicer to be provided by the
applicable Servicer to Depositor
Exhibit O Form of Servicer Power of Attorney
Exhibit P Servicing Criteria
Exhibit Q Additional Form 10-D Disclosure
Exhibit R Additional Form 10-K Disclosure
Exhibit S Form 8-K Disclosure Information
Exhibit T Interest Rate Swap Agreement
Exhibit U Purchase Agreement
Exhibit V Subservicing Agreement
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THIS POOLING AND SERVICING AGREEMENT, dated as of [_______] , 2006,
among ▇▇▇▇▇▇ ▇▇▇▇▇▇▇ ABS CAPITAL I INC., a Delaware corporation, as depositor
(the "Depositor"), [__________________], a national banking association
("____"), [____________________], a [STATE] corporation ("_____" and together
with [_________], the "Servicers"), [___________], a [STATE] corporation, as
responsible party (the "Responsible Party"), and [_______________], a national
banking association, as trustee (the "Trustee").
W I T N E S S E T H:
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In consideration of the mutual agreements herein contained, the
parties hereto agree as follows:
PRELIMINARY STATEMENT
The Trustee shall elect that four segregated asset pools within the
Trust Fund (exclusive of (i) the Prepayment Premiums, (ii) the Swap Assets,
(iii) the Excess Reserve Fund Account, and (iv) the right of the LIBOR
Certificates to receive Upper-Tier CarryForward Amounts including, but without
duplication, Basis Risk CarryForward Amounts and the obligation to pay Class
IO Shortfalls) be treated for federal income tax purposes as comprising four
REMICs (each, a "Trust REMIC" or, in the alternative, Pooling-Tier REMIC-1,
Pooling-Tier REMIC-2, the Lower-Tier REMIC and the Upper-Tier REMIC,
respectively). The Class X Interest, Class IO Interest and each Class of LIBOR
Certificates (other than the right of each Class of LIBOR Certificates to
receive Upper-Tier CarryForward Amounts including, but without duplication,
Basis Risk CarryForward Amounts and the obligation to pay Class IO Shortfalls)
represents ownership of a regular interest in a REMIC for purposes of the
REMIC Provisions. The Class R Certificates represent ownership of the sole
class of residual interest in each Trust REMIC for purposes of the REMIC
Provisions. The Startup Day for each REMIC described herein is the Closing
Date. The latest possible maturity date for each regular interest is the
latest date referenced in Section 2.05. The Upper-Tier REMIC shall hold as
assets the several classes of uncertificated Lower-Tier Regular Interests, set
out below. The Lower-Tier REMIC shall hold as assets the several classes of
uncertificated Pooling-Tier REMIC-2 Regular Interests. Pooling-Tier REMIC-2
shall hold as assets the several classes of uncertificated Pooling-Tier
REMIC-1 Regular Interests. Pooling-Tier REMIC-1 shall hold as assets the
assets of the Trust Fund (exclusive of (i) the Prepayment Premiums, (ii) the
Swap Assets, (iii) the Excess Reserve Fund Account, and (iv) the right of the
LIBOR Certificates to receive Upper-Tier CarryForward Amounts including, but
without duplication, Basis Risk CarryForward Amounts and the obligation to pay
Class IO Shortfalls).
For federal income tax purposes, each Class of LIBOR Certificates
represents a beneficial ownership of a regular interest in the Upper-Tier
REMIC, the right to receive Upper-Tier CarryForward Amounts (including, but
without duplication, Basis Risk CarryForward Amounts), and the obligation to
pay Class IO Shortfalls, the Class X Certificates represent beneficial
ownership of the Class X Interest, the Class IO Interest, the Interest Rate
Swap Agreement, the Swap Account, the Excess Reserve Fund Account and the
right to receive Class IO Shortfalls, and the Class P Certificates represent
beneficial ownership of the Prepayment Premiums, which portions of the Trust
Fund shall be treated as a grantor trust.
Pooling-Tier REMIC-1
Pooling-Tier REMIC-1 shall issue the following interests in
Pooling-Tier REMIC-1, and each such interest, other than the Class PT1-R
Interest is hereby designated as a regular interest in the Pooling-Tier
REMIC-1. Pooling-Tier REMIC-1 shall also issue the Class PT1-R Interest, which
is hereby designated as the sole class of residual interest in Pooling-Tier
REMIC-1. The Class PT1-R Interest shall be represented by the Class R
Certificates, shall not have a principal balance and shall have no interest
rate.
Initial
Pooling-Tier
Pooling-Tier REMIC-1 Pooling-Tier REMIC-1 REMIC-1 Principal
Interest Interest Rate Amount
--------------------- -------------------- --------------------
Class PT1-1 (1) $[________]
Class PT1-2A (2) $[________]
Class PT1-2B (3) $[________]
Class PT1-3A (2) $[________]
Class PT1-3B (3) $[________]
Class PT1-4A (2) $[________]
Class PT1-4B (3) $[________]
Class PT1-5A (2) $[________]
Class PT1-5B (3) $[________]
Class PT1-6A (2) $[________]
Class PT1-6B (3) $[________]
Class PT1-7A (2) $[________]
Class PT1-7B (3) $[________]
Class PT1-8A (2) $[________]
Class PT1-8B (3) $[________]
Class PT1-9A (2) $[________]
Class PT1-9B (3) $[________]
Class PT1-10A (2) $[________]
Class PT1-10B (3) $[________]
Class PT1-11A (2) $[________]
Class PT1-11B (3) $[________]
Class PT1-12A (2) $[________]
Class PT1-12B (3) $[________]
Class PT1-13A (2) $[________]
Class PT1-13B (3) $[________]
Class PT1-14A (2) $[________]
Class PT1-14B (3) $[________]
Class PT1-15A (2) $[________]
Class PT1-15B (3) $[________]
Class PT1-16A (2) $[________]
Class PT1-16B (3) $[________]
Class PT1-17A (2) $[________]
Class PT1-17B (3) $[________]
Class PT1-18A (2) $[________]
Class PT1-18B (3) $[________]
Class PT1-19A (2) $[________]
Class PT1-19B (3) $[________]
Class PT1-20A (2) $[________]
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Initial
Pooling-Tier
Pooling-Tier REMIC-1 Pooling-Tier REMIC-1 REMIC-1 Principal
Interest Interest Rate Amount
--------------------- -------------------- --------------------
Class PT1-20B (3) $[________]
Class PT1-21A (2) $[________]
Class PT1-21B (3) $[________]
Class PT1-22A (2) $[________]
Class PT1-22B (3) $[________]
Class PT1-23A (2) $[________]
Class PT1-23B (3) $[________]
Class PT1-24A (2) $[________]
Class PT1-24B (3) $[________]
Class PT1-25A (2) $[________]
Class PT1-25B (3) $[________]
Class PT1-26A (2) $[________]
Class PT1-26B (3) $[________]
Class PT1-27A (2) $[________]
Class PT1-27B (3) $[________]
Class PT1-28A (2) $[________]
Class PT1-28B (3) $[________]
Class PT1-29A (2) $[________]
Class PT1-29B (3) $[________]
Class PT1-30A (2) $[________]
Class PT1-30B (3) $[________]
Class PT1-31A (2) $[________]
Class PT1-31B (3) $[________]
Class PT1-32A (2) $[________]
Class PT1-32B (3) $[________]
Class PT1-33A (2) $[________]
Class PT1-33B (3) $[________]
Class PT1-34A (2) $[________]
Class PT1-34B (3) $[________]
Class PT1-35A (2) $[________]
Class PT1-35B (3) $[________]
Class PT1-36A (2) $[________]
Class PT1-36B (3) $[________]
Class PT1-37A (2) $[________]
Class PT1-37B (3) $[________]
Class PT1-38A (2) $[________]
Class PT1-38B (3) $[________]
Class PT1-39A (2) $[________]
Class PT1-39B (3) $[________]
Class PT1-40A (2) $[________]
Class PT1-40B (3) $[________]
Class PT1-41A (2) $[________]
Class PT1-41B (3) $[________]
Class PT1-42A (2) $[________]
Class PT1-42B (3) $[________]
Class PT1-43A (2) $[________]
Class PT1-43B (3) $[________]
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Initial
Pooling-Tier
Pooling-Tier REMIC-1 Pooling-Tier REMIC-1 REMIC-1 Principal
Interest Interest Rate Amount
--------------------- -------------------- --------------------
Class PT1-44A (2) $[________]
Class PT1-44B (3) $[________]
Class PT1-45A (2) $[________]
Class PT1-45B (3) $[________]
Class PT1-46A (2) $[________]
Class PT1-46B (3) $[________]
Class PT1-47A (2) $[________]
Class PT1-47B (3) $[________]
Class PT1-48A (2) $[________]
Class PT1-48B (3) $[________]
Class PT1-49A (2) $[________]
Class PT1-49B (3) $[________]
Class PT1-50A (2) $[________]
Class PT1-50B (3) $[________]
Class PT1-51A (2) $[________]
Class PT1-51B (3) $[________]
Class PT1-52A (2) $[________]
Class PT1-52B (3) $[________]
Class PT1-53A (2) $[________]
Class PT1-53B (3) $[________]
Class PT1-54A (2) $[________]
Class PT1-54B (3) $[________]
Class PT1-55A (2) $[________]
Class PT1-55B (3) $[________]
Class PT1-56A (2) $[________]
Class PT1-56B (3) $[________]
Class PT1-R (4) (4)
--------------------------
(1) For any Distribution Date (and the related Interest Accrual Period),
this Pooling-Tier REMIC-1 Regular Interest shall bear interest at a per
annum rate (its "Pooling-Tier REMIC-1 Interest Rate") equal to the
Pooling-Tier REMIC-1 WAC Rate.
(2) For any Distribution Date (and the related Interest Accrual Period),
this Pooling-Tier REMIC-1 Regular Interest shall bear interest at a per
annum rate (its "Pooling-Tier REMIC-1 Interest Rate") equal to the
product of (i) 2 and (ii) the Pooling-Tier REMIC-1 WAC Rate, subject to
a maximum rate of [__]%.
(3) For any Distribution Date (and the related Interest Accrual Period),
this Pooling-Tier REMIC-1 Regular Interest shall bear interest at a per
annum rate (its "Pooling-Tier REMIC-1 Interest Rate") equal to the
excess, if any, of (A) the product of (i) 2 and (ii) the Pooling-Tier
REMIC-1 WAC Rate over (B) [__]%.
(4) The Class PT1-R Interest shall not have a principal balance and shall
not bear interest.
On each Distribution Date, the interest distributable in respect of
the Mortgage Loans for such Distribution Date shall be deemed to be
distributed to the Pooling-Tier REMIC-1 Regular Interests at the rates shown
above.
On each Distribution Date, Realized Losses, Subsequent Recoveries and
payments of principal in respect of the Mortgage Loans shall be allocated to
the outstanding Pooling-Tier REMIC-1 Regular Interest with the lowest
numerical denomination until the
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Pooling-Tier REMIC-1 Principal Amount of such interest is reduced to zero,
provided that, with respect to Pooling-Tier REMIC-1 Regular Interests with the
same numerical denomination, such Realized Losses, Subsequent Recoveries and
payments of principal shall be allocated pro rata between such Pooling-Tier
REMIC-1 Regular Interests, until the Pooling-Tier REMIC-1 Principal Amount of
such interests is reduced to zero.
Pooling-Tier REMIC-2
Pooling-Tier REMIC-2 shall issue the following interests in
Pooling-Tier REMIC-2, and each such interest, other than the Class PT2-R
Interest, is hereby designated as a regular interest in Pooling-Tier REMIC-2.
The Class PT2-R Interest is hereby designated as the sole class of residual
interest in Pooling-Tier REMIC-2 and shall be represented by the Class R
Certificates.
Pooling-Tier Corresponding Corresponding
Pooling-Tier REMIC-2 Corresponding Pooling-Tier Scheduled
REMIC-2 Initial Pooling-Tier REMIC-1 Crossover
Pooling-Tier Interest Principal REMIC-2 IO Regular Distribution
REMIC-2 Interest Rate Amount Interest Interest Date
----------------- ----------- ------------- ---------------- -------------- ---------------
Class PT2-1 (1) $[________] N/A N/A N/A
Class PT2-2A (2) $[________] Class PT2-IO-2 N/A N/A
Class PT2-2B (3) $[________] N/A N/A N/A
Class PT2-3A (2) $[________] Class PT2-IO-3 N/A N/A
Class PT2-3B (3) $[________] N/A N/A N/A
Class PT2-4A (2) $[________] Class PT2-IO-4 N/A N/A
Class PT2-4B (3) $[________] N/A N/A N/A
Class PT2-5A (2) $[________] Class PT2-IO-5 N/A N/A
Class PT2-5B (3) $[________] N/A N/A N/A
Class PT2-6A (2) $[________] Class PT2-IO-6 N/A N/A
Class PT2-6B (3) $[________] N/A N/A N/A
Class PT2-7A (2) $[________] Class PT2-IO-7 N/A N/A
Class PT2-7B (3) $[________] N/A N/A N/A
Class PT2-8A (2) $[________] Class PT2-IO-8 N/A N/A
Class PT2-8B (3) $[________] N/A N/A N/A
Class PT2-9A (2) $[________] Class PT2-IO-9 N/A N/A
Class PT2-9B (3) $[________] N/A N/A N/A
Class PT2-10A (2) $[________] Class PT2-IO-10 N/A N/A
Class PT2-10B (3) $[________] N/A N/A N/A
Class PT2-11A (2) $[________] Class PT2-IO-11 N/A N/A
Class PT2-11B (3) $[________] N/A N/A N/A
Class PT2-12A (2) $[________] Class PT2-IO-12 N/A N/A
Class PT2-12B (3) $[________] N/A N/A N/A
Class PT2-13A (2) $[________] Class PT2-IO-13 N/A N/A
Class PT2-13B (3) $[________] N/A N/A N/A
Class PT2-14A (2) $[________] Class PT2-IO-14 N/A N/A
Class PT2-14B (3) $[________] N/A N/A N/A
Class PT2-15A (2) $[________] Class PT2-IO-15 N/A N/A
Class PT2-15B (3) $[________] N/A N/A N/A
Class PT2-16A (2) $[________] Class PT2-IO-16 N/A N/A
Class PT2-16B (3) $[________] N/A N/A N/A
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Pooling-Tier Corresponding Corresponding
Pooling-Tier REMIC-2 Corresponding Pooling-Tier Scheduled
REMIC-2 Initial Pooling-Tier REMIC-1 Crossover
Pooling-Tier Interest Principal REMIC-2 IO Regular Distribution
REMIC-2 Interest Rate Amount Interest Interest Date
----------------- ----------- ------------- ---------------- -------------- ---------------
Class PT2-17A (2) $[________] Class PT2-IO-17 N/A N/A
Class PT2-17B (3) $[________] N/A N/A N/A
Class PT2-18A (2) $[________] Class PT2-IO-18 N/A N/A
Class PT2-18B (3) $[________] N/A N/A N/A
Class PT2-19A (2) $[________] Class PT2-IO-19 N/A N/A
Class PT2-19B (3) $[________] N/A N/A N/A
Class PT2-20A (2) $[________] Class PT2-IO-20 N/A N/A
Class PT2-20B (3) $[________] N/A N/A N/A
Class PT2-21A (2) $[________] Class PT2-IO-21 N/A N/A
Class PT2-21B (3) $[________] N/A N/A N/A
Class PT2-22A (2) $[________] Class PT2-IO-22 N/A N/A
Class PT2-22B (3) $[________] N/A N/A N/A
Class PT2-23A (2) $[________] Class PT2-IO-23 N/A N/A
Class PT2-23B (3) $[________] N/A N/A N/A
Class PT2-24A (2) $[________] Class PT2-IO-24 N/A N/A
Class PT2-24B (3) $[________] N/A N/A N/A
Class PT2-25A (2) $[________] Class PT2-IO-25 N/A N/A
Class PT2-25B (3) $[________] N/A N/A N/A
Class PT2-26A (2) $[________] Class PT2-IO-26 N/A N/A
Class PT2-26B (3) $[________] N/A N/A N/A
Class PT2-27A (2) $[________] Class PT2-IO-27 N/A N/A
Class PT2-27B (3) $[________] N/A N/A N/A
Class PT2-28A (2) $[________] Class PT2-IO-28 N/A N/A
Class PT2-28B (3) $[________] N/A N/A N/A
Class PT2-29A (2) $[________] Class PT2-IO-29 N/A N/A
Class PT2-29B (3) $[________] N/A N/A N/A
Class PT2-30A (2) $[________] Class PT2-IO-30 N/A N/A
Class PT2-30B (3) $[________] N/A N/A N/A
Class PT2-31A (2) $[________] Class PT2-IO-31 N/A N/A
Class PT2-31B (3) $[________] N/A N/A N/A
Class PT2-32A (2) $[________] Class PT2-IO-32 N/A N/A
Class PT2-32B (3) $[________] N/A N/A N/A
Class PT2-33A (2) $[________] Class PT2-IO-33 N/A N/A
Class PT2-33B (3) $[________] N/A N/A N/A
Class PT2-34A (2) $[________] Class PT2-IO-34 N/A N/A
Class PT2-34B (3) $[________] N/A N/A N/A
Class PT2-35A (2) $[________] Class PT2-IO-35 N/A N/A
Class PT2-35B (3) $[________] N/A N/A N/A
Class PT2-36A (2) $[________] Class PT2-IO-36 N/A N/A
Class PT2-36B (3) $[________] N/A N/A N/A
Class PT2-37A (2) $[________] Class PT2-IO-37 N/A N/A
Class PT2-37B (3) $[________] N/A N/A N/A
Class PT2-38A (2) $[________] Class PT2-IO-38 N/A N/A
Class PT2-38B (3) $[________] N/A N/A N/A
Class PT2-39A (2) $[________] Class PT2-IO-39 N/A N/A
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Pooling-Tier Corresponding Corresponding
Pooling-Tier REMIC-2 Corresponding Pooling-Tier Scheduled
REMIC-2 Initial Pooling-Tier REMIC-1 Crossover
Pooling-Tier Interest Principal REMIC-2 IO Regular Distribution
REMIC-2 Interest Rate Amount Interest Interest Date
----------------- ----------- ------------- ---------------- -------------- ---------------
Class PT2-39B (3) $[________] N/A N/A N/A
Class PT2-40A (2) $[________] Class PT2-IO-40 N/A N/A
Class PT2-40B (3) $[________] N/A N/A N/A
Class PT2-41A (2) $[________] Class PT2-IO-41 N/A N/A
Class PT2-41B (3) $[________] N/A N/A N/A
Class PT2-42A (2) $[________] Class PT2-IO-42 N/A N/A
Class PT2-42B (3) $[________] N/A N/A N/A
Class PT2-43A (2) $[________] Class PT2-IO-43 N/A N/A
Class PT2-43B (3) $[________] N/A N/A N/A
Class PT2-44A (2) $[________] Class PT2-IO-44 N/A N/A
Class PT2-44B (3) $[________] N/A N/A N/A
Class PT2-45A (2) $[________] Class PT2-IO-45 N/A N/A
Class PT2-45B (3) $[________] N/A N/A N/A
Class PT2-46A (2) $[________] Class PT2-IO-46 N/A N/A
Class PT2-46B (3) $[________] N/A N/A N/A
Class PT2-47A (2) $[________] Class PT2-IO-47 N/A N/A
Class PT2-47B (3) $[________] N/A N/A N/A
Class PT2-48A (2) $[________] Class PT2-IO-48 N/A N/A
Class PT2-48B (3) $[________] N/A N/A N/A
Class PT2-49A (2) $[________] Class PT2-IO-49 N/A N/A
Class PT2-49B (3) $[________] N/A N/A N/A
Class PT2-50A (2) $[________] Class PT2-IO-50 N/A N/A
Class PT2-50B (3) $[________] N/A N/A N/A
Class PT2-51A (2) $[________] Class PT2-IO-51 N/A N/A
Class PT2-51B (3) $[________] N/A N/A N/A
Class PT2-52A (2) $[________] Class PT2-IO-52 N/A N/A
Class PT2-52B (3) $[________] N/A N/A N/A
Class PT2-53A (2) $[________] Class PT2-IO-53 N/A N/A
Class PT2-53B (3) $[________] N/A N/A N/A
Class PT2-54A (2) $[________] Class PT2-IO-54 N/A N/A
Class PT2-54B (3) $[________] N/A N/A N/A
Class PT2-55A (2) $[________] Class PT2-IO-55 N/A N/A
Class PT2-55B (3) $[________] N/A N/A N/A
Class PT2-56A (2) $[________] Class PT2-IO-56 N/A N/A
Class PT2-56B (3) $[________] N/A N/A N/A
Class PT2-IO-2 (4) (4) N/A Class PT1-2A [_______] 2006
Class PT2-IO-3 (4) (4) N/A Class PT1-3A [_______] 2006
Class PT2-IO-4 (4) (4) N/A Class PT1-4A [_______] 2006
Class PT2-IO-5 (4) (4) N/A Class PT1-5A [_______] 2006
Class PT2-IO-6 (4) (4) N/A Class PT1-6A [_______] 2006
Class PT2-IO-7 (4) (4) N/A Class PT1-7A [_______] 2006
Class PT2-IO-8 (4) (4) N/A Class PT1-8A [_______] 2006
Class PT2-IO-9 (4) (4) N/A Class PT1-9A [_______] 2006
Class PT2-IO-10 (4) (4) N/A Class PT1-10A [_______] 2006
Class PT2-IO-11 (4) (4) N/A Class PT1-11A [_______] 2006
-7-
Pooling-Tier Corresponding Corresponding
Pooling-Tier REMIC-2 Corresponding Pooling-Tier Scheduled
REMIC-2 Initial Pooling-Tier REMIC-1 Crossover
Pooling-Tier Interest Principal REMIC-2 IO Regular Distribution
REMIC-2 Interest Rate Amount Interest Interest Date
----------------- ----------- ------------- ---------------- -------------- ---------------
Class PT2-IO-12 (4) (4) N/A Class PT1-12A [_______] 2006
Class PT2-IO-13 (4) (4) N/A Class PT1-13A [_______] 2007
Class PT2-IO-14 (4) (4) N/A Class PT1-14A [_______] 2007
Class PT2-IO-15 (4) (4) N/A Class PT1-15A [_______] 2007
Class PT2-IO-16 (4) (4) N/A Class PT1-16A [_______] 2007
Class PT2-IO-17 (4) (4) N/A Class PT1-17A [_______] 2007
Class PT2-IO-18 (4) (4) N/A Class PT1-18A [_______] 2007
Class PT2-IO-19 (4) (4) N/A Class PT1-19A [_______] 2007
Class PT2-IO-20 (4) (4) N/A Class PT1-20A [_______] 2007
Class PT2-IO-21 (4) (4) N/A Class PT1-21A [_______] 2007
Class PT2-IO-22 (4) (4) N/A Class PT1-22A [_______] 2007
Class PT2-IO-23 (4) (4) N/A Class PT1-23A [_______] 2007
Class PT2-IO-24 (4) (4) N/A Class PT1-24A [_______] 2007
Class PT2-IO-25 (4) (4) N/A Class PT1-25A [_______] 2008
Class PT2-IO-26 (4) (4) N/A Class PT1-26A [_______] 2008
Class PT2-IO-27 (4) (4) N/A Class PT1-27A [_______] 2008
Class PT2-IO-28 (4) (4) N/A Class PT1-28A [_______] 2008
Class PT2-IO-29 (4) (4) N/A Class PT1-29A [_______] 2008
Class PT2-IO-30 (4) (4) N/A Class PT1-30A [_______] 2008
Class PT2-IO-31 (4) (4) N/A Class PT1-31A [_______] 2008
Class PT2-IO-32 (4) (4) N/A Class PT1-32A [_______] 2008
Class PT2-IO-33 (4) (4) N/A Class PT1-33A [_______] 2008
Class PT2-IO-34 (4) (4) N/A Class PT1-34A [_______] 2008
Class PT2-IO-35 (4) (4) N/A Class PT1-35A [_______] 2008
Class PT2-IO-36 (4) (4) N/A Class PT1-36A [_______] 2008
Class PT2-IO-37 (4) (4) N/A Class PT1-37A [_______] 2009
Class PT2-IO-38 (4) (4) N/A Class PT1-38A [_______] 2009
Class PT2-IO-39 (4) (4) N/A Class PT1-39A [_______] 2009
Class PT2-IO-40 (4) (4) N/A Class PT1-40A [_______] 2009
Class PT2-IO-41 (4) (4) N/A Class PT1-41A [_______] 2009
Class PT2-IO-42 (4) (4) N/A Class PT1-42A [_______] 2009
Class PT2-IO-43 (4) (4) N/A Class PT1-43A [_______] 2009
Class PT2-IO-44 (4) (4) N/A Class PT1-44A [_______] 2009
Class PT2-IO-45 (4) (4) N/A Class PT1-45A [_______] 2009
Class PT2-IO-46 (4) (4) N/A Class PT1-46A [_______] 2009
Class PT2-IO-47 (4) (4) N/A Class PT1-47A [_______] 2009
Class PT2-IO-48 (4) (4) N/A Class PT1-48A [_______] 2009
Class PT2-IO-49 (4) (4) N/A Class PT1-49A [_______] 2010
Class PT2-IO-50 (4) (4) N/A Class PT1-50A [_______] 2010
Class PT2-IO-51 (4) (4) N/A Class PT1-51A [_______] 2010
Class PT2-IO-52 (4) (4) N/A Class PT1-52A [_______] 2010
Class PT2-IO-53 (4) (4) N/A Class PT1-53A [_______] 2010
Class PT2-IO-54 (4) (4) N/A Class PT1-54A [_______] 2010
Class PT2-IO-55 (4) (4) N/A Class PT1-55A [_______] 2010
Class PT2-IO-56 (4) (4) N/A Class PT1-56A [_______] 2010
-8-
Pooling-Tier Corresponding Corresponding
Pooling-Tier REMIC-2 Corresponding Pooling-Tier Scheduled
REMIC-2 Initial Pooling-Tier REMIC-1 Crossover
Pooling-Tier Interest Principal REMIC-2 IO Regular Distribution
REMIC-2 Interest Rate Amount Interest Interest Date
----------------- ----------- ------------- ---------------- -------------- ---------------
Class PT2 R (5) (5) N/A N/A N/A
--------------------------
(1) For any Distribution Date (and the related Interest Accrual Period),
this Pooling-Tier REMIC-2 Regular Interest shall bear interest at a
per annum rate (its "Pooling-Tier REMIC-2 Interest Rate") equal to
the Pooling-Tier REMIC-1 WAC Rate.
(2) For any Distribution Date (and the related Interest Accrual Period),
this Pooling-Tier REMIC-2 Regular Interest shall bear interest at a
per annum rate (its "Pooling-Tier REMIC-2 Interest Rate") equal to
the weighted average of the Pooling-Tier REMIC-1 Interest Rates on
the Pooling-Tier REMIC-1 Regular Interests having an "A" in their
class designation, provided that, on each Distribution Date on which
interest is distributable on the Corresponding Pooling-Tier REMIC-2
IO Interest, this Pooling-Tier REMIC-2 Regular Interest shall bear
interest at a per annum rate equal to Swap LIBOR subject to a
maximum rate equal to the weighted average of the Pooling-Tier
REMIC-1 Interest Rates on the Pooling-Tier REMIC-1 Regular Interests
having an "A" in their class designation.
(3) For any Distribution Date (and the related Interest Accrual Period),
this Pooling-Tier REMIC-2 Regular Interest shall bear interest at a
per annum rate (its "Pooling-Tier REMIC-2 Interest Rate") equal to
the weighted average of the Pooling-Tier REMIC-1 Interest Rates on
the Pooling-Tier REMIC-1 Regular Interests having a "B" in their
class designation.
(4) Each Pooling-Tier REMIC-2 IO is an interest-only interest and does
not have a principal balance but has a notional balance
("Pooling-Tier REMIC-2 IO Notional Balance") equal to the
Pooling-Tier REMIC-2 Principal Amount of the Corresponding
Pooling-Tier REMIC-1 Regular Interest. From the Closing Date through
and including the Corresponding Scheduled Crossover Distribution
Date, each Pooling-Tier REMIC-2 IO Interest shall be entitled to
receive interest that accrues on the Corresponding Pooling-Tier
REMIC-1 Regular Interest at a rate equal to the excess, if any, of
(i) the Pooling-Tier REMIC-1 Interest Rate for the Corresponding
Pooling-Tier REMIC-1 Regular Interest over (ii) Swap LIBOR. After
the Corresponding Scheduled Crossover Distribution Date, the
Pooling-Tier REMIC-2 IO Interest shall not accrue interest.
(5) The Class PT2-R Interest shall not have a principal balance and
shall not bear interest.
On each Distribution Date, the interest distributable in respect of
the Mortgage Loans for such Distribution Date shall be distributed to the
Pooling-Tier REMIC-2 Regular Interests at the Pooling-Tier REMIC-2 Interest
Rates shown above.
On each Distribution Date, Realized Losses, Subsequent Recoveries and
payments of principal in respect of the Mortgage Loans shall be allocated to
the then outstanding Pooling-Tier REMIC-2 Regular Interests (other than the
Pooling-Tier REMIC-2 IO Interests) with the lowest numerical denomination
until the Pooling-Tier REMIC-2 Principal Amount of such interest is reduced to
zero, provided that, for Pooling-Tier REMIC-2 Regular Interests with the same
numerical denomination, such Realized Losses, Subsequent Recoveries and
payments of principal shall be allocated pro rata between such Pooling-Tier
REMIC-2 Regular Interests, until the Pooling-Tier REMIC-2 Principal Amount of
such interests is reduced to zero.
-9-
Lower-Tier REMIC
The Lower-Tier REMIC shall issue the following interests, and each
such interest, other than the Class LT-R Interest, is hereby designated as a
regular interest in the Lower-Tier REMIC. The Class LT-R Interest is hereby
designated as the sole class of residual interest in the Lower-Tier REMIC and
shall be represented by the Class R Certificates.
Corresponding
Upper-Tier
Lower-Tier REMIC Lower-Tier Initial Lower-Tier Principal REMIC Regular
Interest Interest Rate Amount Interest
------------------ --------------- ---------------------------- ---------------
Class LT-A-1 (1) 1/2 initial Class Certificate A-1
Balance of Corresponding
Upper-Tier Regular Interest
Class LT-A-2 (1) 1/2 initial Class Certificate A-2
Balance of Corresponding
Upper-Tier Regular Interest
Class LT-A-3 (1) 1/2 initial Class Certificate A-3
Balance of Corresponding
Upper-Tier Regular Interest
Class LT-A-4 (1) 1/2 initial Class Certificate A-4
Balance of Corresponding
Upper-Tier Regular Interest
Class LT-M-1 (1) 1/2 initial Class Certificate M-1
Balance of Corresponding
Upper-Tier Regular Interest
Class LT-M-2 (1) 1/2 initial Class Certificate M-2
Balance of Corresponding
Upper-Tier Regular Interest
Class LT-M-3 (1) 1/2 initial Class Certificate M-3
Balance of Corresponding
Upper-Tier Regular Interest
Class LT-M-4 (1) 1/2 initial Class Certificate M-4
Balance of Corresponding
Upper-Tier Regular Interest
Class LT-M-5 (1) 1/2 initial Class Certificate M-5
Balance of Corresponding
Upper-Tier Regular Interest
Class LT-M-6 (1) 1/2 initial Class Certificate M-6
Balance of Corresponding
Upper-Tier Regular Interest
Class LT-B-1 (1) 1/2 initial Class Certificate B-1
Balance of Corresponding
Upper-Tier Regular Interest
Class LT-B-2 (1) 1/2 initial Class Certificate B-2
Balance of Corresponding
Upper-Tier Regular Interest
Class LT-B-3 (1) 1/2 initial Class Certificate B-3
Balance of Corresponding
Upper-Tier Regular Interest
-10-
Corresponding
Upper-Tier
Lower-Tier REMIC Lower-Tier Initial Lower-Tier Principal REMIC Regular
Interest Interest Rate Amount Interest
------------------ --------------- ---------------------------- ---------------
Class LT-Accrual (1) 1/2 Pool Stated Principal N/A
Balance plus 1/2 Subordinated
Amount
Class LT-IO (2) (2) N/A
Class LT-R (3) (3) N/A
--------------------------
(1) The interest rate with respect to any Distribution Date for these
interests is a per annum variable rate equal to the weighted average of
the Pooling-Tier REMIC-2 Interest Rates of the Pooling-Tier REMIC-2
Regular Interests (other than the Pooling-Tier REMIC-2 IO Interests).
(2) This Lower-Tier Regular Interest is an interest-only interest and does
not have a Lower-Tier Principal Amount. On each Distribution Date, this
Lower-Tier Regular Interest shall be entitled to receive all interest
distributable on the Pooling-Tier REMIC-2 IO Interests.
(3) The Class LT-R Interest is the sole class of residual interest in the
Lower-Tier REMIC and it does not have a principal amount or an interest
rate.
Each Lower-Tier Regular Interest is hereby designated as a regular
interest in the Lower-Tier REMIC. The Class LT-A-1, Class LT-A-2, Class
LT-A-3, Class LT-A-4, Class LT-M-1, Class LT-M-2, Class LT-M-3, Class LT-M-4,
Class LT-M-5, Class LT-M-6, Class LT-B-1, Class LT-B-2 and Class LT-B-3
Interests are hereby designated the LT-Accretion Directed Classes (the
"LT-Accretion Directed Classes").
On each Distribution Date, [__]% of the increase in the Subordinated
Amount shall be payable as a reduction of the Lower Tier Principal Amount of
the LT-Accretion Directed Classes (each such Class will be reduced by an
amount equal to [__]% of any increase in the Subordinated Amount that is
attributable to a reduction in the Class Certificate Balance of its
Corresponding Class) and shall be accrued and added to the Lower Tier
Principal Amount of the Class LT-Accrual Interest. On each Distribution Date,
the increase in the Lower Tier Principal Amount of the Class LT-Accrual
Interest shall not exceed interest accruals for such Distribution Date for the
Class LT-Accrual Interest. In the event that: (i) [__]% of the increase in the
Subordinated Amount exceeds (ii) interest accruals on the Class LT-Accrual
Interest for such Distribution Date, the excess for such Distribution Date
(accumulated with all such excesses for all prior Distribution Dates) will be
added to any increase in the Subordinated Amount for purposes of determining
the amount of interest accrual on the Class LT-Accrual Interest payable as
principal on the LT-Accretion Directed Classes on the next Distribution Date
pursuant to the first sentence of this paragraph. All payments of scheduled
principal and prepayments of principal generated by the Mortgage Loans and all
Subsequent Recoveries allocable to principal shall be allocated (i) [__]% to
the Class LT-Accrual Interest and (ii) [__]% to the LT-Accretion Directed
Classes (such principal payments and Subsequent Recoveries shall be allocated
among such LT Accretion Directed Classes in an amount equal to [__]% of the
principal amounts and Subsequent Recoveries allocated to their respective
Corresponding Classes), until paid in full. Notwithstanding the above,
principal payments allocated to the Class X Interest that result in the
reduction in the Subordinated Amount shall be allocated to the Class
LT-Accrual Interest (until paid in full). Realized Losses shall be applied so
that after all distributions have been made on each Distribution Date (i) the
Lower Tier Principal Amount of each LT-Accretion Directed Class
-11-
is equal to [__]% of the Class Certificate Balance of its Corresponding Class,
and (ii) the Class LT-Accrual Interest is equal to [__]% of the aggregate
Stated Principal Balance of the Mortgage Loans plus [__]% of the Subordinated
Amount. Any increase in the Class Certificate Balance of a Class of Offered
Certificates as a result of a Subsequent Recovery shall increase the Lower
Tier Principal Amount of the Corresponding Lower Tier Regular Interest by
[__]% of such increase and the remaining [__]% of such increase shall increase
the Lower Tier Principal Amount of the Class LT-Accrual Interest.
Upper Tier REMIC
The Upper-Tier REMIC shall issue the following interests, and each
such interest, other than the Class UT-R Interest, is hereby designated as a
regular interest in the Upper-Tier REMIC. The Class UT-R Interest is hereby
designated as the sole class of residual interests in the Upper-Tier REMIC and
shall be represented by the Class R Certificates.
Corresponding
Upper-Tier REMIC Upper-Tier Initial Principal Class of
Interest Interest Rate Upper-Tier Amount Certificates
-------------------- ----------------- -------------------- -----------------
Class A-1 (1) $[________] Class A-1
Class A-2 (1) $[________] Class A-2
Class A-3 (1) $[________] Class A-3
Class A-4 (1) $[________] Class A-4
Class M-1 (1) $[________] Class M-1
Class M-2 (1) $[________] Class M-2
Class M-3 (1) $[________] Class M-3
Class M-4 (1) $[________] Class M-4
Class M-5 (1) $[________] Class M-5
Class M-6 (1) $[________] Class M-6
Class B-1 (1) $[________] Class B-1
Class B-2 (1) $[________] Class B-2
Class B-3 (1) $[________] Class B-3
Class IO (2) (2) N/A
Class X (3) (3) Class X
Class UT-R (4) (4) Class R
--------------------------
(1) For any Distribution Date (and the related Interest Accrual Period) this
interest shall bear interest at the lesser of (i) the Pass-Through Rate
(determined without regard to the WAC Cap) for the Corresponding Class
of Certificates and (ii) the Upper-Tier REMIC WAC Rate.
(2) This interest is an interest-only interest and does not have a principal
balance. On each Distribution Date, the Class IO Interest shall be
entitled to receive all interest distributable on the Class LT-IO
Interest. This interest shall be beneficially owned by the holders of
the Class X Certificates and shall be held as an asset of the Swap
Account.
(3) The Class X Interest has an initial principal balance of $[__] but will
not accrue interest on such balance but will accrue interest on a
notional principal balance. As of any Distribution Date, the Class X
Interest shall have a notional principal balance equal to the aggregate
of the Lower-Tier Principal Amounts of the Lower-Tier Regular Interests
(other than the Class LT-IO Interest) as of the first day of the related
Interest Accrual Period. With respect to any Interest Accrual Period,
the Class X Interest shall bear interest at a rate equal to the excess,
if any, of the Upper-Tier REMIC WAC Rate over the product of (i) 2 and
(ii) the weighted average of the Lower-Tier Interest Rates of the
Lower-Tier REMIC Interests (other than the Class LT-IO Interest), where
the Lower-Tier Interest Rate on each of the Class LT-Accrual Interest,
is subject to a cap equal to zero and each LT-Accretion Directed Class
is subject to a cap equal to the Upper-Tier
-12-
Interest Rate on its Corresponding Class of Upper-Tier Regular Interest.
With respect to any Distribution Date, interest that so accrues on the
notional principal balance of the Class X Interest shall be deferred in
an amount equal to any increase in the Subordinated Amount on such
Distribution Date. Such deferred interest shall not itself bear
interest.
(4) The Class UT-R Interest does not have an interest rate or a principal
balance.
On each Distribution Date, interest distributable in respect of the
Lower-Tier Interests for such Distribution Date shall be deemed to be
distributed on the interests in the Upper-Tier REMIC at the rates shown above,
provided that the Class IO Interest shall be entitled to receive interest
before any other interest in the Upper-Tier REMIC.
On each Distribution Date, all Realized Losses, Subsequent Recoveries
and all payments of principal shall be allocated to the Upper-Tier Interests
until the outstanding principal balance of each such interest equals the
outstanding Class Certificate Balance of the Corresponding Class of
Certificates as of such Distribution Date.
The Certificates
Class Class Certificate
Class Designation Pass-Through Rate Balance
--------------------- ------------------- ------------------
Class A-1 (1) $[________]
Class A-2 (1) $[________]
Class A-3 (1) $[________]
Class A-4 (1) $[________]
Class M-1 (2) $[________]
Class M-2 (2) $[________]
Class M-3 (2) $[________]
Class M-4 (2) $[________]
Class M-5 (2) $[________]
Class M-6 (2) $[________]
Class B-1 (2) $[________]
Class B-2 (2) $[________]
Class B-3 (2) $[________]
Class X (3) (3)
Class R (4) (4)
--------------------------
(1) The Class A-1, Class A-2, Class A-3 and Class A-4 Interest will bear
interest during each Interest Accrual Period at a per annum rate equal
to (a) on or prior to the Optional Termination Date, the least of (i)
LIBOR plus [__]%, [__]%, [__]% and [__]%, respectively, and (ii) the WAC
Cap or (b) after the Optional Termination Date, the least of (i) LIBOR
plus [__]%, [__]%, [__]% and [__]%, respectively, and (ii) the WAC Cap.
(2) The Class M-1, Class M-2, Class M-3, Class M-4, Class M-5, Class M-6,
Class B-1, Class B-2 and Class B-3 Interests will bear interest during
each Interest Accrual Period at a per annum rate equal to (a) on or
prior to the Optional Termination Date, the lesser of (i) LIBOR plus
[__]%, [__]%, [__]%, [__]%, [__]%, [__]%, [__]%, [__]% and [__]%,
respectively, and (ii) the WAC Cap or (b) after the Optional Termination
Date, the lesser of (i) LIBOR plus [__]%, [__]%, [__]%, [__]%, [__]%,
[__]%, [__]%, [__]% and [__]% respectively, and (ii) the WAC Cap.
-13-
(3) The Class X Certificates will represent beneficial ownership of the
Class X Interest, the Class IO Interest, the Interest Rate Swap
Agreement, the right to Class IO Shortfalls and amounts in the Excess
Reserve Fund Account and the Swap Account, subject to the obligation to
make payments from the Excess Reserve Fund Account in respect of Basis
Risk CarryForward Amounts and amounts in the Swap Account subject to the
obligation to make Net Swap Payments, Swap Termination Payments and
Basis Risk CarryForward Amounts. For federal income tax purposes, the
Trustee will treat a Class X Certificateholder's obligation to make
payments from the Excess Reserve Fund Account or the Swap Account as
payments made pursuant to an interest rate cap contract written by the
Class X Certificateholders in favor of each Class of LIBOR Certificates.
Such rights of the Class X Certificateholders and LIBOR
Certificateholders shall be treated as held in a portion of the Trust
Fund that is treated as a grantor trust under subpart E, Part I of
subchapter J of the Code.
(4) The Class R Certificates do not have an interest rate or a principal
balance.
The minimum denomination for each Class of Certificates, other than
the Class P, Class R and the Class X Certificates, will be $[__] with integral
multiples of $[__] in excess thereof. The minimum denomination for the Class P
and the Class X Certificates will each be a [__]% Percentage Interest in such
Class. The Class R Certificate will represent a 100% Percentage Interest in
such Class.
It is expected that each Class of Certificates will receive its final
distribution of principal and interest on or prior to the Final Scheduled
Distribution Date.
Set forth below are designations of Classes of Certificates to the
categories used herein:
Book-Entry Certificates...... All Classes of Certificates other than the
Physical Certificates.
Class A Certificates......... Class A-1, Class A-2, Class A-3 and Class A-4.
Delay Certificates........... None.
ERISA-Restricted
Certificates............... Class R Certificates, Class P Certificates and
Class X Certificates; any certificate with a
rating below the lowest applicable permitted
rating under the Underwriters' Exemption.
Non-Delay Certificates....... Class A, Class X and Subordinated Certificates.
Offered Certificates......... All Classes of Certificates other than the
Private Certificates.
Physical Certificates........ Class P, Class X and Class R Certificates.
Private Certificates......... Class P, Class X and Class R Certificates.
Rating Agencies.............. [▇▇▇▇▇'▇, Fitch and Standard & Poor's.]
Regular Certificates......... All Classes of Certificates other than the Class
P and Class R Certificates.
-14-
Residual Certificates........ Class R Certificates.
Subordinated Certificates.... Class M-1, Class M-2, Class M-3, Class M-4,
Class M-5, Class M-6, Class B-1, Class B-2 and
Class B-3 Certificates.
ARTICLE I
DEFINITIONS
Whenever used in this Agreement, the following words and phrases,
unless the context otherwise requires, shall have the following meanings:
Accepted Servicing Practices: With respect to any Mortgage Loan, those
mortgage servicing practices set forth in Section 3.01(a) of this Agreement.
Account: Any of the Collection Accounts, the Distribution Account, any
Escrow Account, the Excess Reserve Fund Account or the Swap Account. Each
Account shall be an Eligible Account.
Accrued Certificate Interest Distribution Amount: With respect to any
Distribution Date for each Class of Offered Certificates, the amount of
interest accrued during the related Interest Accrual Period at the applicable
Pass-Through Rate on the related Class Certificate Balance immediately prior
to such Distribution Date, as reduced by such Class's share of Net Prepayment
Interest Shortfalls and Relief Act Interest Shortfalls for such Distribution
Date allocated to such Class pursuant to Section 4.02.
Adjustable Rate Mortgage Loan: An adjustable rate Mortgage Loan.
Adjusted Net Mortgage Rate: As to each Mortgage Loan and at any time,
the per annum rate equal to the Mortgage Rate less the Expense Fee Rate.
Adjustment Date: As to any Adjustable Rate Mortgage Loan, the first
Due Date on which the related Mortgage Rate adjusts as set forth in the
related Mortgage Note and each Due Date thereafter on which the Mortgage Rate
adjusts as set forth in the related Mortgage Note.
Advance: Any P&I Advance or Servicing Advance.
Advance Facility: A financing or other facility as described in
Section 10.07.
Advancing Person: The Person to whom any Servicer's rights under this
Agreement to be reimbursed for any P&I Advances or Servicing Advances have
been assigned pursuant to Section 10.07.
Affiliate: With respect to any Person, any other Person controlling,
controlled by or under common control with such first Person. For the purposes
of this definition, "control" means the power to direct the management and
policies of such Person, directly or indirectly,
-15-
whether through the ownership of voting securities, by contract or otherwise;
and the terms "controlling" and "controlled" have meanings correlative to the
foregoing.
Agreement: This Pooling and Servicing Agreement and all amendments or
supplements hereto.
Amount Held for Future Distribution: As to the Certificates on any
Distribution Date, the aggregate amount held in each Collection Account at the
close of business on the related Determination Date on account of (i)
Principal Prepayments, Insurance Proceeds, Condemnation Proceeds and
Liquidation Proceeds on the Mortgage Loans received after the end of the
related Prepayment Period and (ii) all Scheduled Payments on the Mortgage
Loans due after the end of the related Due Period.
Analytics Company: [______________], or any other bond analytics
service provider identified to the Trustee by the Depositor.
Applied Realized Loss Amount: With respect to any Distribution Date,
the amount, if any, by which the aggregate Class Certificate Balance of the
Offered Certificates after distributions of principal on such Distribution
Date exceeds the aggregate Stated Principal Balance of the Mortgage Loans for
such Distribution Date.
Appraised Value: The value set forth in an appraisal made in
connection with the origination of the related Mortgage Loan as the value of
the Mortgaged Property.
Assignment of Mortgage: An assignment of the Mortgage, notice of
transfer or equivalent instrument in recordable form (other than the
assignee's name and recording information not yet returned from the recording
office), reflecting the sale of the Mortgage to the Trustee.
Available Funds: With respect to any Distribution Date and the
Mortgage Loans to the extent received by the Trustee (x) the sum of (i) all
scheduled installments of interest (net of the related Expense Fees) and
principal due on the Due Date on such Mortgage Loans in the related Due Period
and received by the Servicers on or prior to the related Determination Date,
together with any P&I Advances in respect thereof; (ii) all Condemnation
Proceeds, Insurance Proceeds and Liquidation Proceeds received by the
Servicers during the related Prepayment Period (in each case, net of
unreimbursed expenses incurred in connection with a liquidation or foreclosure
and unreimbursed Advances, if any); (iii) all partial or full prepayments on
the Mortgage Loans received by the Servicers during the related Prepayment
Period together with all Compensating Interest, if applicable, thereon
(excluding any Prepayment Charges); (iv) all Substitution Adjustment Amounts
with respect to the substitutions of Mortgage Loans that occur with respect to
such Distribution Date; (v) amounts received with respect to such Distribution
Date as the Repurchase Price in respect of a Mortgage Loan repurchased by the
Responsible Party with respect to such Distribution Date; (vi) the proceeds
received with respect to the termination of the Trust Fund pursuant to clause
(a) of Section 9.01; and (vii) the Closing Date Deposit Amount; reduced by (y)
amounts in reimbursement for Advances previously made with respect to the
Mortgage Loans and other amounts as to which the Servicers, the Depositor or
the Trustee are entitled to be paid or reimbursed pursuant to this Agreement.
-16-
Balloon Loan: Any Mortgage Loan that requires only payments of
interest until the stated maturity date of the Mortgage Loan or Scheduled
Payments of principal which (not including the payment due on its stated
maturity date) are based on an amortization schedule that would be
insufficient to fully amortize the principal thereof by the stated maturity
date of the Mortgage Loan.
Basic Principal Distribution Amount: With respect to any Distribution
Date, the excess of (i) the Principal Remittance Amount for such Distribution
Date 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 Accrued Certificate Interest
Distribution Amount such Class of Certificates would otherwise be entitled to
receive on such Distribution Date had such Pass-Through Rate not been subject
to any WAC Cap (that is, had such rate been calculated as the sum of LIBOR and
the applicable Pass-Through Margin on such Class of Certificates for such
Distribution Date and the resulting amount being reduced by allocated Net
Prepayment Interest Shortfalls and Relief Act Interest Shortfalls) over (ii)
the Accrued Certificate Interest Distribution Amount received on such
Distribution Date such Class of Certificates at, with respect to each Class of
Offered Certificates, the WAC Cap for such Distribution Date and (B) the Basis
Risk Carry Forward Amount for such Class of Certificates for all previous
Distribution Dates not previously paid, together with interest thereon at a
rate equal to the sum of LIBOR and the applicable Pass-Through Margin for such
Class of Certificates for such Distribution Date.
Basis Risk Payment: For any Distribution Date, an amount equal to the
lesser of (i) the aggregate of the Basis Risk Carry Forward Amounts for such
Distribution Date and (ii) the Class X Distributable Amount (prior to any
reduction for amounts paid from the Excess Reserve Fund Account to pay any
Basis Risk Carry Forward Amount or any Swap Termination Payment).
Best's: Best's Key Rating Guide, as the same shall be amended from
time to time.
Book-Entry Certificates: As specified in the Preliminary Statement.
Business Day: Any day other than (i) Saturday or Sunday, or (ii) a day
on which banking and savings and loan institutions, in (a) the States of New
York, California, New Jersey, Texas, Arizona or Delaware, (b) a State in which
any Servicer's servicing operations are located, or (c) the State in which the
Trustee's operations are located, are authorized or obligated by law or
executive order to be closed.
Certificate: Any one of the Certificates executed by the Trustee in
substantially the forms attached hereto as exhibits.
Certificate Balance: With respect to any Class of Certificates, other
than the Class X, Class P or Class R Certificates, at any date, the maximum
dollar amount of principal to which the Holder thereof is then entitled
hereunder, such amount being equal to the
-17-
Denomination thereof minus all distributions of principal previously made with
respect thereto and in the case of any Certificates, reduced by any Applied
Realized Loss Amounts allocated to such Class of Certificates pursuant to
Section 4.05; provided, however, that immediately following the Distribution
Date on which a Subsequent Recovery is distributed, the Class Certificate
Balances of any Class or Classes of Certificates that have been previously
reduced by Applied Realized Loss Amounts will be increased, in order of
seniority, by the amount of the Subsequent Recovery distributed on such
Distribution Date (up to the amount of the Unpaid Realized Loss Amount for
such Class or Classes for such Distribution Date). The Class X, Class P and
Class R Certificates have no Certificate Balance.
Certificate Owner: With respect to a Book-Entry Certificate, the
Person who is the beneficial owner of such Book-Entry Certificate.
Certificate Register: The register maintained pursuant to Section
5.02.
Certificateholder or Holder: The person in whose name a Certificate is
registered in the Certificate Register, except that, solely for the purpose of
giving any consent pursuant to this Agreement, any Certificate registered in
the name of the Depositor or any Affiliate of the Depositor shall be deemed
not to be Outstanding and the Percentage Interest evidenced thereby shall not
be taken into account in determining whether the requisite amount of
Percentage Interests necessary to effect such consent has been obtained;
provided, however, that if any such Person (including the Depositor) owns 100%
of the Percentage Interests evidenced by a Class of Certificates, such
Certificates shall be deemed to be Outstanding for purposes of any provision
hereof that requires the consent of the Holders of Certificates of a
particular Class as a condition to the taking of any action hereunder. The
Trustee is entitled to rely conclusively on a certification of the Depositor
or any Affiliate of the Depositor in determining which Certificates are
registered in the name of an Affiliate of the Depositor.
Class: All Certificates bearing the same class designation as set
forth in the Preliminary Statement.
Class A Certificates: As specified in the Preliminary Statement.
Class A Principal Distribution Amount: With respect to any
Distribution Date, the excess of (i) the aggregate Class Certificate Balances
of the Class A Certificates immediately prior to such Distribution Date over
(ii) the lesser of (A) [__]% of the aggregate Stated Principal Balance of the
Mortgage Loans for such Distribution Date and (B) the excess, if any, of the
aggregate Stated Principal Balance of the Mortgage Loans for such Distribution
Date over $[__].
Class A-1 Certificates: All Certificates bearing the class designation
of "Class A-1".
Class A-2 Certificates: All Certificates bearing the class designation
of "Class A-2".
Class A-3 Certificates: All Certificates bearing the class designation
of "Class A-3".
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Class A-4 Certificates: All Certificates bearing the class designation
of "Class A-4".
Class B Certificates: The Class B-1, Class B-2 and Class B-3
Certificates.
Class B-1 Certificates: All Certificates bearing the class designation
of "Class B-1".
Class B-1 Principal Distribution Amount: With respect to any
Distribution Date, the excess of (i) the sum of (A) the aggregate Class
Certificate Balances of the Class A Certificates (after taking into account
the distribution of the Class A Principal Distribution Amount for such
Distribution Date), (B) the Class Certificate Balance of the Class M-1
Certificates (after taking into account the distribution of the Class M-1
Principal Distribution Amount for such Distribution Date), (C) the Class
Certificate Balance of the Class M-2 Certificates (after taking into account
the distribution of the Class M-2 Principal Distribution Amount for such
Distribution Date), (D) the Class Certificate Balance of the Class M-3
Certificates (after taking into account the distribution of the Class M-3
Principal Distribution Amount for such Distribution Date), (E) the Class
Certificate Balance of the Class M-4 Certificates (after taking into account
the distribution of the Class M-4 Principal Distribution Amount for such
Distribution Date), (F) the Class Certificate Balance of the Class M-5
Certificates (after taking into account the distribution of the Class M-5
Principal Distribution Amount for such Distribution Date), (G) the Class
Certificate Balance of the Class M-6 Certificates (after taking into account
the distribution of the Class M-6 Principal Distribution Amount for such
Distribution Date) and (H) the Class Certificate Balance of the Class B-1
Certificates immediately prior to such Distribution Date over (ii) the lesser
of (A) [__]% of the aggregate Stated Principal Balance of the Mortgage Loans
for such Distribution Date and (B) the excess, if any, of the aggregate Stated
Principal Balance of the Mortgage Loans for such Distribution Date over $[__].
Class B-2 Certificates: All Certificates bearing the class designation
of "Class B-2".
Class B-2 Principal Distribution Amount: With respect to any
Distribution Date, the excess of (i) the sum of (A) the aggregate Class
Certificate Balances of the Class A Certificates (after taking into account
the distribution of the Class A Principal Distribution Amount for such
Distribution Date), (B) the Class Certificate Balance of the Class M-1
Certificates (after taking into account the distribution of the Class M-1
Principal Distribution Amount for such Distribution Date), (C) the Class
Certificate Balance of the Class M-2 Certificates (after taking into account
the distribution of the Class M-2 Principal Distribution Amount for such
Distribution Date), (D) the Class Certificate Balance of the Class M-3
Certificates (after taking into account the distribution of the Class M-3
Principal Distribution Amount for such Distribution Date), (E) the Class
Certificate Balance of the Class M-4 Certificates (after taking into account
the distribution of the Class M-4 Principal Distribution Amount for such
Distribution Date), (F) the Class Certificate Balance of the Class M-5
Certificates (after taking into account the distribution of the Class M-5
Principal Distribution Amount for such Distribution Date), (G) the Class
Certificate Balance of the Class M-6 Certificates (after taking into account
the distribution of the Class M-6 Principal Distribution
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Amount for such Distribution Date), (H) the Class Certificate Balance of the
Class B-1 Certificates (after taking into account the distribution of the
Class B-1 Principal Distribution Amount for such Distribution Date) and (I)
the Class Certificate Balance of the Class B-2 Certificates immediately prior
to such Distribution Date over (ii) the lesser of (A) [__]% of the aggregate
Stated Principal Balance of the Mortgage Loans for such Distribution Date and
(B) the excess, if any, of the aggregate Stated Principal Balance of the
Mortgage Loans for such Distribution Date over $[__].
Class B-3 Certificates: All Certificates bearing the class designation
of "Class B-3".
Class B-3 Principal Distribution Amount: With respect to any
Distribution Date, the excess of (i) the sum of (A) the aggregate Class
Certificate Balances of the Class A Certificates (after taking into account
the distribution of the Class A Principal Distribution Amount for such
Distribution Date), (B) the Class Certificate Balance of the Class M-1
Certificates (after taking into account the distribution of the Class M-1
Principal Distribution Amount for such Distribution Date), (C) the Class
Certificate Balance of the Class M-2 Certificates (after taking into account
the distribution of the Class M-2 Principal Distribution Amount for such
Distribution Date), (D) the Class Certificate Balance of the Class M-3
Certificates (after taking into account the distribution of the Class M-3
Principal Distribution Amount for such Distribution Date), (E) the Class
Certificate Balance of the Class M-4 Certificates (after taking into account
the distribution of the Class M-4 Principal Distribution Amount for such
Distribution Date), (F) the Class Certificate Balance of the Class M-5
Certificates (after taking into account the distribution of the Class M-5
Principal Distribution Amount for such Distribution Date), (G) the Class
Certificate Balance of the Class M-6 Certificates (after taking into account
the distribution of the Class M-6 Principal Distribution Amount for such
Distribution Date), (H) the Class Certificate Balance of the Class B-1
Certificates (after taking into account the distribution of the Class B-1
Principal Distribution Amount for such Distribution Date), (I) the Class
Certificate Balance of the Class B-2 Certificates (after taking into account
the distribution of the Class B-2 Principal Distribution Amount for such
Distribution Date) and (J) the Class Certificate Balance of the Class B-3
Certificates immediately prior to such Distribution Date over (ii) the lesser
of (A) [__]% of the aggregate Stated Principal Balance of the Mortgage Loans
for such Distribution Date and (B) the excess, if any, of the aggregate Stated
Principal Balance of the Mortgage Loans for such Distribution Date over $[__].
Class Certificate Balance: With respect to any Class and as to any
date of determination, the aggregate of the Certificate Balances of all
Certificates of such Class as of such date.
Class IO Interest: As specified in the Preliminary Statement.
Class IO Shortfalls: As defined in Section 8.13. For the avoidance of
doubt, the Class IO Shortfall for any Distribution Date shall equal the amount
payable to the Class X Certificates in respect of amounts due to the Swap
Provider on such Distribution Date (other than Defaulted Swap Termination
Payments) in excess of the amount payable on the Class X Interest
-20-
(prior to any reduction for Basis Risk Payments or Swap Termination Payments)
on such Distribution Date, all as further provided in Section 8.13.
Class LT-R Interest: The residual interest in the Lower-Tier REMIC as
described in the Preliminary Statement and the related footnote thereto.
Class M Certificates: The Class M-1, Class M-2, Class M-3, Class M-4,
Class M-5 and Class M-6 Certificates.
Class M-1 Enhancement Percentage: With respect to any Distribution
Date, the percentage obtained by dividing (x) the sum of (i) the aggregate
Class Certificate Balances of the Class M and Class B Certificates (other than
the Class M-1 Certificates) and (ii) the Subordinated Amount, in each case
after taking into account the distributions of the related Principal
Distribution Amount and any principal payments on those Classes of
Certificates from the Swap Account on that Distribution Date, by (y) the
aggregate Stated Principal Balance of the Mortgage Loans for that Distribution
Date.
Class M-1 Certificates: All Certificates bearing the class designation
of "Class M-1".
Class M-1 Principal Distribution Amount: With respect to any
Distribution Date, the excess of (i) the sum of (A) the aggregate Class
Certificate Balances of the Class A Certificates (after taking into account
the distribution of the Class A Principal Distribution Amount for such
Distribution Date), and (B) the Class Certificate Balance of the Class M-1
Certificates immediately prior to such Distribution Date over (ii) the lesser
of (A) [__]% of the aggregate Stated Principal Balance of the Mortgage Loans
for such Distribution Date and (B) the excess, if any, of the aggregate Stated
Principal Balance of the Mortgage Loans for such Distribution Date over $[__].
Class M-2 Certificates: All Certificates bearing the class designation
of "Class M-2".
Class M-2 Principal Distribution Amount: With respect to any
Distribution Date, the excess of (i) the sum of (A) the aggregate Class
Certificate Balances of the Class A Certificates (after taking into account
the distribution of the Class A Principal Distribution Amount for such
Distribution Date), (B) the Class Certificate Balance of the Class M-1
Certificates (after taking into account the distribution of the Class M-1
Principal Distribution Amount for such Distribution Date) and (C) the Class
Certificate Balance of the Class M-2 Certificates immediately prior to such
Distribution Date over (ii) the lesser of (A) [__]% of the aggregate Stated
Principal Balance of the Mortgage Loans for such Distribution Date and (B) the
excess, if any, of the aggregate Stated Principal Balance of the Mortgage
Loans for such Distribution Date over $[__].
Class M-3 Certificates: All Certificates bearing the class designation
of "Class M-3".
Class M-3 Principal Distribution Amount: With respect to any
Distribution Date, the excess of (i) the sum of (A) the aggregate Class
Certificate Balances of the Class A
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Certificates (after taking into account the distribution of the Class A
Principal Distribution Amount for such Distribution Date), (B) the Class
Certificate Balance of the Class M-1 Certificates (after taking into account
the distribution of the Class M-1 Principal Distribution Amount for such
Distribution Date), (C) the Class Certificate Balance of the Class M-2
Certificates (after taking into account the distribution of the Class M-2
Principal Distribution Amount for such Distribution Date) and (D) the Class
Certificate Balance of the Class M-3 Certificates immediately prior to such
Distribution Date over (ii) the lesser of (A) [__]% of the aggregate Stated
Principal Balance of the Mortgage Loans for such Distribution Date and (B) the
excess, if any, of the aggregate Stated Principal Balance of the Mortgage
Loans for such Distribution Date over $[__].
Class M-4 Certificates: All Certificates bearing the class designation
of "Class M-4".
Class M-4 Principal Distribution Amount: With respect to any
Distribution Date, the excess of (i) the sum of (A) the aggregate Class
Certificate Balances of the Class A Certificates (after taking into account
the distribution of the Class A Principal Distribution Amount for such
Distribution Date), (B) the Class Certificate Balance of the Class M-1
Certificates (after taking into account the distribution of the Class M-1
Principal Distribution Amount for such Distribution Date), (C) the Class
Certificate Balance of the Class M-2 Certificates (after taking into account
the distribution of the Class M-2 Principal Distribution Amount for such
Distribution Date), (D) the Class Certificate Balance of the Class M-3
Certificates (after taking into account the distribution of the Class M-3
Principal Distribution Amount for such Distribution Date) and (E) the Class
Certificate Balance of the Class M-4 Certificates immediately prior to such
Distribution Date over (ii) the lesser of (A) [__]% of the aggregate Stated
Principal Balance of the Mortgage Loans for such Distribution Date and (B) the
excess, if any, of the aggregate Stated Principal Balance of the Mortgage
Loans for such Distribution Date over $[__].
Class M-5 Certificates: All Certificates bearing the class designation
of "Class M-5".
Class M-5 Principal Distribution Amount: With respect to any
Distribution Date, the excess of (i) the sum of (A) the aggregate Class
Certificate Balances of the Class A Certificates (after taking into account
the distribution of the Class A Principal Distribution Amount for such
Distribution Date), (B) the Class Certificate Balance of the Class M-1
Certificates (after taking into account the distribution of the Class M-1
Principal Distribution Amount for such Distribution Date), (C) the Class
Certificate Balance of the Class M-2 Certificates (after taking into account
the distribution of the Class M-2 Principal Distribution Amount for such
Distribution Date), (D) the Class Certificate Balance of the Class M-3
Certificates (after taking into account the distribution of the Class M-3
Principal Distribution Amount for such Distribution Date), (E) the Class
Certificate Balance of the Class M-4 Certificates (after taking into account
the distribution of the Class M-4 Principal Distribution Amount for such
Distribution Date) and (F) the Class Certificate Balance of the Class M-5
Certificates immediately prior to such Distribution Date over (ii) the lesser
of (A) [__]% of the aggregate Stated Principal Balance of the Mortgage Loans
for such Distribution Date and (B) the
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excess, if any, of the aggregate Stated Principal Balance of the Mortgage
Loans for such Distribution Date over $[__].
Class M-6 Certificates: All Certificates bearing the class designation
of "Class M-6".
Class M-6 Principal Distribution Amount: With respect to any
Distribution Date, the excess of (i) the sum of (A) the aggregate Class
Certificate Balances of the Class A Certificates (after taking into account
the distribution of the Class A Principal Distribution Amount for such
Distribution Date), (B) the Class Certificate Balance of the Class M-1
Certificates (after taking into account the distribution of the Class M-1
Principal Distribution Amount for such Distribution Date), (C) the Class
Certificate Balance of the Class M-2 Certificates (after taking into account
the distribution of the Class M-2 Principal Distribution Amount for such
Distribution Date), (D) the Class Certificate Balance of the Class M-3
Certificates (after taking into account the distribution of the Class M-3
Principal Distribution Amount for such Distribution Date), (E) the Class
Certificate Balance of the Class M-4 Certificates (after taking into account
the distribution of the Class M-4 Principal Distribution Amount for such
Distribution Date), (F) the Class Certificate Balance of the Class M-5
Certificates (after taking into account the distribution of the Class M-5
Principal Distribution Amount for such Distribution Date) and (G) the Class
Certificate Balance of the Class M-6 Certificates immediately prior to such
Distribution Date over (ii) the lesser of (A) [__]% of the aggregate Stated
Principal Balance of the Mortgage Loans for such Distribution Date and (B) the
excess, if any, of the aggregate Stated Principal Balance of the Mortgage
Loans for such Distribution Date over $[__].
Class P Certificates: All Certificates bearing the class designation
of "Class P".
Class PT1-R Interest: The residual interest in Pooling-Tier REMIC-1 as
described in the Preliminary Statement and the related footnote thereto.
Class PT2-R Interest: The residual interest in Pooling-Tier REMIC-2 as
described in the Preliminary Statement and the related footnote thereto.
Class R Certificates: All Certificates bearing the class designation
of "Class R".
Class UT-R Interest: The residual interest in the Upper-Tier REMIC as
described in the Preliminary Statement and the related footnote thereto.
Class X Certificates: All Certificates bearing the class designation
of "Class X".
Class X Distributable Amount: On any Distribution Date, the sum of (i)
as a distribution in respect of interest, the amount of interest that has
accrued on the Class X Interest and not applied as an Extra Principal
Distribution Amount on such Distribution Date, plus any such accrued interest
remaining undistributed from prior Distribution Dates, plus, without
duplication (ii) as a distribution in respect of principal, any portion of the
principal balance of the Class X Interest which is distributable as a
Subordination Reduction Amount, minus (iii) any amounts paid from the Excess
Reserve Fund Account to pay any Basis Risk Carry Forward Amount or any Swap
Termination Payment.
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Class X Interest: The Upper Tier Regular Interest represented by the
Class X Certificates as specified and described in the Preliminary Statement
and the related footnote thereto.
Closing Date: [_______] , 2006.
Closing Date Deposit Amount: $[__] (all of which is allocable to
principal) deposited by the Depositor into the Distribution Account on the
Closing Date.
Code: The Internal Revenue Code of 1986, including any successor or
amendatory provisions.
Collection Account: As defined in Section 3.10(a).
Combined Loan to Value Ratio or CLTV: As of any date and as to any
Second Lien Mortgage Loan, the ratio, expressed as a percentage, of the (a)
sum of (i) the outstanding principal balance of the Second Lien Mortgage Loan
and (ii) the outstanding principal balance as of such date of any mortgage
loan or mortgage loans that are senior or equal in priority to the Second Lien
Mortgage Loan and which are secured by the same Mortgaged Property to (b) the
Appraised Value as determined pursuant to the Underwriting Guidelines of the
related Mortgaged Property as of the origination of the Second Lien Mortgage
Loan.
Commission: The United States Securities and Exchange Commission.
Compensating Interest: For any Distribution Date, the lesser of (a)
the amount by which such Prepayment Interest Shortfall exceeds all Prepayment
Interest Excesses for such Distribution Date on the Mortgage Loans serviced by
the applicable Servicer and (b) the amount of the aggregate Servicing Fee paid
to or retained by the applicable Servicer for such Distribution Date.
Condemnation Proceeds: All awards of settlements in respect of a
Mortgaged Property, whether permanent or temporary, partial or entire, by
exercise of the power of eminent domain or condemnation.
Convertible Mortgage Loan: Any individual Adjustable Rate Mortgage
Loan which contains a provision whereby the Mortgagor is permitted to convert
the Adjustable Rate Mortgage Loan to a Fixed Rate Mortgage Loan in accordance
with the terms of the related Mortgage Note.
Corporate Trust Office: The designated office of the Trustee in the
State of [STATE] at which at any particular time its corporate trust business
with respect to this Agreement is administered, which office at the date of
the execution of this Agreement is located at [ADDRESS], and which is the
address to which notices to and correspondence with the Trustee should be
directed.
Corresponding Class: The class of interests in the Lower-Tier REMIC or
Upper-Tier REMIC that corresponds to the class of interests in the other such
REMIC or to a Class of Certificates in the manner set out below:
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Corresponding
Corresponding Lower-Tier Class Upper-Tier Regular Corresponding Class of
Designation Interest Certificates
-------------------------------- ----------------------- -----------------------
Class LT-A-1 Class A-1 Class A-1
Class LT-A-2 Class A-2 Class A-2
Class LT-A-3 Class A-3 Class A-3
Class LT-A-4 Class A-4 Class A-4
Class LT-M-1 Class M-1 Class M-1
Class LT-M-2 Class M-2 Class M-2
Class LT-M-3 Class M-3 Class M-3
Class LT-M-4 Class M-4 Class M-4
Class LT-M-5 Class M-5 Class M-5
Class LT-M-6 Class M-6 Class M-6
Class LT-B-1 Class B-1 Class B-1
Class LT-B-2 Class B-2 Class B-2
Class LT-B-3 Class B-3 Class B-3
N/A Class X Class X
Corresponding Pooling-Tier REMIC-1 Regular Interest: As described in
the Preliminary Statement.
Corresponding Pooling-Tier REMIC-2 IO Interest: As described in the
Preliminary Statement.
Corresponding Scheduled Crossover Distribution Date: The Distribution
Date in the month and year specified in the Preliminary Statement
corresponding to a Pooling-Tier REMIC-2 IO Interest.
Cumulative Loss Percentage: With respect to any Distribution Date, the
percentage equivalent of a fraction, the numerator of which is the aggregate
amount of Realized Losses incurred from the Cut-off Date to the last day of
the calendar month preceding the month in which such Distribution Date occurs
and the denominator of which is the Cut-off Date Pool Principal Balance of the
Mortgage Loans.
Cumulative Loss Trigger Event: With respect to any Distribution Date,
a Cumulative Loss Trigger Event exists if 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 Prepayment Period, divided by
(y) the Cut-off Date Pool Principal Balance, exceeds the applicable cumulative
loss percentages set forth below with respect to such Distribution Date:
Distribution Date Occurring In Cumulative Loss Percentage
------------------------------ --------------------------
[_______] 2008 through [_______] [__]% for the first month, plus
2009 an additional [_/_] of [__]% for
each month thereafter (e.g.,
[__]% in [_______] 2008)
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Distribution Date Occurring In Cumulative Loss Percentage
------------------------------ --------------------------
[_______] 2009 through [_______] [__]% for the first month, plus
2010 an additional [_/_] of [__]%
for each month thereafter (e.g.,
[__]% in [_______] 2009)
[_______] 2010 through [_______] [__]% for the first month, plus
2011 an additional [_/_] of [__]%
for each month thereafter (e.g.,
[__]% in [_______] 2010)
[_______] 2011 through [_______] 6.200% for the first month, plus
2012 an additional 1/12th of 0.750%
for each month thereafter (e.g.,
6.575% in [_______] 2011)
[_______] 2012 through [_______] [__]% for the first month, plus
2013 an additional [_\_] of [__]%
for each month thereafter (e.g.,
[__]% in [_______] 2012)
[_______] 2013 and thereafter [__]%
Custodial File: With respect to each Mortgage Loan, the file retained
by the Trustee consisting of items (a)-(h) as listed on Exhibit K hereto.
Cut-off Date: [_______] , 2006.
Cut-off Date Pool Principal Balance: The aggregate Stated Principal
Balances of all Mortgage Loans as of the Cut-off Date plus the portion of the
Closing Date Deposit Amount allocable to principal.
Cut-off Date Principal Balance: As to any Mortgage Loan, the Stated
Principal Balance thereof as of the close of business on the Cut-off Date
(after giving effect to payments of principal due on that date, whether or not
received).
Data Tape Information: The information provided by the Responsible
Party as of the Cut-off Date to the Depositor or the Sponsor setting forth the
following information with respect to each Mortgage Loan: (1) the Mortgagor's
name; (2) as to each Mortgage Loan, the Scheduled Principal Balance as of the
Cut-off Date; (3) the Mortgage Rate Cap; (4) the Index; (5) a code indicating
whether the Mortgaged Property is owner-occupied; (6) the type of Mortgaged
Property; (7) the first date on which the Scheduled Payment was due on the
Mortgage Loan and, if such date is not consistent with the Due Date currently
in effect, such Due Date; (8) the "paid through date" based on payments
received from the related Mortgagor; (9) the original principal amount of the
Mortgage Loan; (10) with respect to Adjustable Rate Mortgage Loans, the
Maximum Mortgage Rate; (11) the type of Mortgage Loan (i.e., Fixed Rate or
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Adjustable Rate Mortgage Loan, First Lien Mortgage Loan or Second Lien
Mortgage Loan); (12) a code indicating the purpose of the loan (i.e.,
purchase, rate and term refinance, equity take-out refinance); (13) a code
indicating the documentation style (i.e., full, asset verification, income
verification and no documentation); (14) the credit risk score (FICO score);
(15) the loan credit grade classification (as described in the underwriting
guidelines); (16) with respect to each Adjustable Rate Mortgage Loan, the
Minimum Mortgage Rate; (17) the Mortgage Rate at origination; (18) with
respect to each Adjustable Rate Mortgage Loan, the first Adjustment Date
immediately following the Cut-off Date; (19) the value of the Mortgaged
Property; (20) a code indicating the type of Prepayment Charges applicable to
such Mortgage Loan (including any prepayment penalty term), if any; (21) with
respect to each Adjustable Rate Mortgage Loan, the Periodic Mortgage Rate Cap;
(22) with respect to each First Lien Mortgage Loan, the LTV at origination and
with respect to each Second Lien Mortgage Loan, the CLTV at origination; and
(23) if such Mortgage Loan is covered by a primary mortgage insurance policy
or a lender-paid primary mortgage insurance policy, the primary mortgage
insurance rate. With respect to the Mortgage Loans in the aggregate, the Data
Tape Information shall set forth the following information, as of the Cut-off
Date: (1) the number of Mortgage Loans; (2) the current aggregate outstanding
principal balance of the Mortgage Loans; (3) the weighted average Mortgage
Rate of the Mortgage Loans; and (4) the weighted average maturity of the
Mortgage Loans.
Debt Service Reduction: With respect to any Mortgage Loan, a reduction
by a court of competent jurisdiction in a proceeding under the United States
Bankruptcy Code in the Scheduled Payment for such Mortgage Loan which became
final and non-appealable, except such a reduction resulting from a Deficient
Valuation or any reduction that results in a permanent forgiveness of
principal.
Defaulted Swap Termination Payment: Any Swap Termination Payment
required to be paid by the Trust to the Swap Provider pursuant to the Interest
Rate Swap Agreement as a result of an Event of Default (as defined in the
Interest Rate Swap Agreement) with respect to which the Swap Provider is the
defaulting party or a Termination Event (as defined in the Interest Rate Swap
Agreement) (other than Illegality or a Tax Event that is not a Tax Event Upon
Merger (each as defined in the Interest Rate Swap Agreement )) with respect to
which the Swap Provider is the sole Affected Party (as defined in the Interest
Rate Swap Agreement).
Deficient Valuation: With respect to any Mortgage Loan, a valuation of
the related Mortgaged Property by a court of competent jurisdiction in an
amount less than the then outstanding principal balance of the Mortgage Loan,
which valuation results from a proceeding initiated under the United States
Bankruptcy Code.
Definitive Certificates: Any Certificate evidenced by a Physical
Certificate and any Certificate issued in lieu of a Book-Entry Certificate
pursuant to Section 5.02(e).
Delay Certificates: As specified in the Preliminary Statement.
Deleted Mortgage Loan: As defined in Section 2.03.
Delinquency Trigger Event: With respect to any Distribution Date, a
Delinquency Trigger Event exists if the quotient (expressed as a percentage)
of (x) the rolling
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three month average of the aggregate Stated Principal Balance of 60+ Day
Delinquent Mortgage Loans (including Mortgage Loans in foreclosure and
Mortgage Loans related to REO Property) and (y) (1) until the aggregate Class
Certificate Balance of the Class A Certificates have been reduced to zero, the
aggregate Stated Principal Balance of the Mortgage Loans for such Distribution
Date equals or exceeds [__]% of the prior period's Senior Enhancement
Percentage and (2) after the aggregate Class Certificate Balance of the Class
A Certificates have been reduced to zero, the aggregate Stated Principal
Balance of the Mortgage Loans for such Distribution Date equals or exceeds
[__]% of the prior period's Class M Enhancement Percentage.
Denomination: With respect to each Certificate, the amount set forth
on the face thereof as the "Initial Certificate Balance of this Certificate"
or the Percentage Interest appearing on the face thereof.
Depositor: ▇▇▇▇▇▇ ▇▇▇▇▇▇▇ ABS Capital I Inc., a Delaware corporation,
and its successors in interest.
Depository: The initial Depository shall be The Depository Trust
Company, the nominee of which is CEDE & Co., as the registered Holder of the
Book-Entry Certificates. The Depository shall at all times be a "clearing
corporation" as defined in Section 8-102(a)(5) of the Uniform Commercial Code
of the State of New York.
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 (to
the extent they are Rating Agencies hereunder).
Depository Participant: A broker, dealer, bank or other financial
institution or other Person for whom from time to time a Depository effects
book-entry transfers and pledges of securities deposited with the Depository.
Determination Date: With respect to each Distribution Date, the [__]
day (or if such day is not a Business Day, the immediately preceding Business
Day) in the calendar month in which such Distribution Date occurs.
Distribution Account: The separate Eligible Account created and
maintained by the Trustee pursuant to Section 3.07(d) in the name of the
Trustee for the benefit of the Certificateholders and designated
"[_______________] in trust for registered holders of ▇▇▇▇▇▇ ▇▇▇▇▇▇▇ ABS
Capital I Inc. Trust 2006-[___] Mortgage Pass-Through Certificates, Series
2006-[___]". Funds in the Distribution Account shall be held in trust for the
Certificateholders for the uses and purposes set forth in this Agreement.
Distribution Account Deposit Date: As to any Distribution Date, 12:00
noon New York City time on the second Business Day immediately preceding such
Distribution Date.
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Distribution Date: The 25th day of each calendar month, or if such day
is not a Business Day, the next succeeding Business Day, commencing in
[_______] 2006.
Document Certification and Exception Report: The report attached to
Exhibit F hereto.
Due Date: The day of the month on which the Scheduled Payment is due
on a Mortgage Loan, exclusive of any days of grace.
Due Period: With respect to any Distribution Date, the period
commencing on the second day of the calendar month preceding the month in
which such Distribution Date occurs and ending on the first day of the
calendar month in which such Distribution Date occurs.
Eligible Account: Either (i) an account maintained with a federal or
state chartered depository institution or trust company that complies with the
definition of Eligible Institution, (ii) an account maintained with the
corporate trust department of a federal depository institution or
state-chartered depository institution subject to regulations regarding
fiduciary funds on deposit similar to Title 12 of the U.S. Code of Federal
Regulation Section 9.10(b), which, in either case, has corporate trust powers
and is acting in its fiduciary capacity or (iii) any other account acceptable
to each Rating Agency. Eligible Accounts may bear interest, and may include,
if otherwise qualified under this definition, accounts maintained with the
Trustee. Each Eligible Account shall be a separate account.
Eligible Institution: A federal or state-chartered depository
institution or trust company the commercial paper, short-term debt
obligations, or other short-term deposits of which are rated "A-1+" by
Standard & Poor's if the amounts on deposit are to be held in the account for
no more than 365 days (or at least "A-2" by Standard & Poor's if the amounts
on deposit are to be held in the account for no more than 30 days), or the
long-term unsecured debt obligations of which are rated at least "AA-" by
Standard & Poor's if the amounts on deposit are to be held in the account for
no more than 365 days, and the commercial paper, short-term debt obligations
or other short-term deposits of which are rated at least "P-1" by Moody's and
"F1+" by Fitch (or a comparable rating if another Rating Agency is specified
by the Depositor by written notice to the Servicer and the Trustee) (in each
case, to the extent they are designated as Rating Agencies in the Preliminary
Statement).
ERISA: The Employee Retirement Income Security Act of 1974, as
amended.
ERISA-Qualifying Underwriting: A best efforts or firm commitment
underwriting or private placement that meets the requirements of 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.
ERISA-Restricted Certificate: As specified in the Preliminary
Statement.
Escrow Account: The Eligible Account or Accounts established and
maintained pursuant to Section 3.09(b).
Escrow Payments: As defined in Section 3.09(b).
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Event of Default: As defined in Section 7.01.
Excess Reserve Fund Account: The separate Eligible Account created and
maintained by the Trustee pursuant to Sections 3.07(b) and 3.07(c) in the name
of the Trustee for the benefit of the Regular Certificateholders and
designated "[_______________] in trust for registered Holders of ▇▇▇▇▇▇
▇▇▇▇▇▇▇ ABS Capital I Inc. Trust 2006-[___], Mortgage Pass-Through
Certificates, Series 2006-[___]". Funds in the Excess Reserve Fund Account
shall be held in trust for the Regular Certificateholders for the uses and
purposes set forth in this Agreement. Amounts on deposit in the Excess Reserve
Fund Account shall not be invested.
Excess Subordinated Amount: With respect to any Distribution Date, the
excess, if any, of (a) the Subordinated Amount on such Distribution Date over
(b) the Specified Subordinated Amount for such Distribution Date.
Exchange Act: The Securities Exchange Act of 1934, as amended.
Expense Fee Rate: As to each Mortgage Loan, a per annum rate equal to
the sum of the Servicing Fee Rate, the Trustee Fee Rate and any lender-paid
primary mortgage insurance fee rate, if applicable.
Expense Fees: As to each Mortgage Loan, the sum of the Servicing Fee,
the Trustee Fee and any lender-paid primary mortgage insurance fee, if
applicable.
Extra Principal Distribution Amount: As of any Distribution Date, the
lesser of (x) the related Total Monthly Excess Spread for such Distribution
Date and (y) the related Subordination Deficiency for such Distribution Date.
▇▇▇▇▇▇ Mae: The Federal National Mortgage Association, or any
successor thereto.
▇▇▇▇▇▇ ▇▇▇ Guides: The ▇▇▇▇▇▇ ▇▇▇ ▇▇▇▇▇▇▇' Guide and the ▇▇▇▇▇▇ ▇▇▇
Servicers' Guide and all amendments or additions thereto.
FDIC: The Federal Deposit Insurance Corporation, or any successor
thereto.
Final Recovery Determination: With respect to any defaulted Mortgage
Loan or any REO Property (other than a Mortgage Loan or REO Property purchased
by the Responsible Party, as contemplated by this Agreement), a determination
made by the applicable Servicer that all Insurance Proceeds, Condemnation
Proceeds, Liquidation Proceeds and other payments or recoveries which the
applicable Servicer, in its reasonable good faith judgment, expects to be
finally recoverable in respect thereof have been so recovered. Each Servicer
shall maintain records, prepared by a Servicing Officer, of each Final
Recovery Determination made thereby.
Final Scheduled Distribution Date: The Final Scheduled Distribution
Date for each Class of Certificates is the Distribution Date in [_______]
2035.
First Lien Mortgage Loan: A Mortgage Loan secured by a first lien
Mortgage on the related Mortgaged Property.
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Fitch: Fitch, Inc., and its successors in interest. If Fitch is
designated as a Rating Agency in the Preliminary Statement, for purposes of
Section 12.05(b) the address for notices to Fitch shall be Fitch, Inc., ▇▇▇
▇▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇, ▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇, Attention: MBS Monitoring -
▇▇▇▇▇▇ ▇▇▇▇▇▇▇ ABS Capital I Inc. Trust 2006-[___], or such other address as
Fitch may hereafter furnish to the Depositor, the Trustee and the Servicers.
Fixed Rate Mortgage Loan: A fixed rate Mortgage Loan.
▇▇▇▇▇▇▇ Mac: The Federal Home Loan Mortgage Corporation, a corporate
instrumentality of the United States created and existing under Title III of
the Emergency Home Finance Act of 1970, as amended, or any successor thereto.
Gross Margin: With respect to each Adjustable Rate Mortgage Loan, the
fixed percentage amount set forth in the related Mortgage Note to be added to
the applicable Index to determine the Mortgage Rate.
[_______]: [____________________], a [STATE] corporation, and its
successors in interest.
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 on
the related Mortgage Note.
Insurance Policy: With respect to any Mortgage Loan included in the
Trust Fund, any insurance policy, including all riders and endorsements
thereto in effect, including any replacement policy or policies for any
Insurance Policies.
Insurance Proceeds: With respect to each Mortgage Loan, proceeds of
insurance policies insuring the Mortgage Loan or the related Mortgaged
Property.
Interest Accrual Period: With respect to each Class of Non-Delay
Certificates and the Corresponding Class of Lower Tier Regular Interests and
any Distribution Date, the period commencing on the Distribution Date
occurring in the month preceding the month in which the current Distribution
Date occurs and ending on the day immediately preceding the current
Distribution Date (or, in the case of the first Distribution Date, the period
from and including the Closing Date to but excluding such first Distribution
Date). For purposes of computing interest accruals on each Class of Non-Delay
Certificates, each Interest Accrual Period has the actual number of days in
such month and each year is assumed to have 360 days.
Interest Rate Adjustment Date: With respect to each Adjustable Rate
Mortgage Loan, the date, specified in the related Mortgage Note and the
Mortgage Loan Schedule, on which the Mortgage Rate is adjusted.
Interest Rate Swap Agreement: The interest rate swap agreement, dated
as of the Closing Date, between ▇▇▇▇▇▇ ▇▇▇▇▇▇▇ Capital Services Inc. and the
Trustee, a copy of which is attached hereto as Exhibit T.
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Interest Remittance Amount: With respect to any Distribution Date and
the Mortgage Loans, that portion of Available Funds attributable to interest
relating to Mortgage Loans.
Investment Account: As defined in Section 3.12(a).
Investor-Based Exemption: Any of Prohibited Transaction Class
Exemption ("PTCE") 84-14 (for transactions by independent "qualified
professional asset managers"), PTCE 90-1 (for transactions by insurance
company pooled separate accounts), PTCE 91-38 (for transactions by bank
collective investment funds), PTCE 95-60 (for transactions by insurance
company general accounts) or PTCE 96-23 (for transactions effected by
"in-house asset managers"), or any comparable exemption available under
Similar Law.
[_________]: [__________________], a national banking association, and
its successors in interest.
Late Collections: With respect to any Mortgage Loan and any Due
Period, all amounts received after the Determination Date immediately
following such Due Period, whether as late payments of Scheduled Payments or
as Insurance Proceeds, Condemnation Proceeds, Liquidation Proceeds or
otherwise, which represent late payments or collections of principal and/or
interest due (without regard to any acceleration of payments under the related
Mortgage and Mortgage Note) but delinquent for such Due Period and not
previously recovered.
LIBOR: With respect to any Interest Accrual Period for the Offered
Certificates, the rate determined by the Trustee on the related LIBOR
Determination Date on the basis of the offered rate for one-month U.S. dollar
deposits as such rate appears on Telerate Page 3750 as of 11:00 a.m. (London
time) on such date; provided, that if such rate does not appear on Telerate
Page 3750, the rate for such date will be determined on the basis of the rates
at which one-month U.S. dollar deposits are offered by the Reference Banks at
approximately 11:00 a.m. (London time) on such date to prime banks in the
London interbank market. In such event, the Trustee shall request the
principal London office of each of the Reference Banks to provide a quotation
of its rate. If at least two such quotations are provided, the rate for that
date will be the arithmetic mean of the quotations (rounded upwards if
necessary to the nearest whole multiple of [_/_]%). If fewer than two
quotations are provided as requested, the rate for that date will be the
arithmetic mean of the rates quoted by major banks in New York City, selected
by the Trustee (after consultation with the Depositor), at approximately 11:00
a.m. (New York City time) on such date for one-month U.S. dollar loans to
leading European banks.
LIBOR Determination Date: With respect to any Interest Accrual Period
for the Offered Certificates, the second London Business Day preceding the
commencement of such Interest Accrual Period.
Liquidated Mortgage Loan: With respect to any Distribution Date, a
defaulted Mortgage Loan (including any REO Property) which either (a) was
liquidated in the calendar month preceding the month of such Distribution Date
and as to which the applicable Servicer has certified to the Trustee that it
has received all amounts it expects to receive in connection with the
liquidation of such Mortgage Loan including the final disposition of an REO
Property, or
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(b) is a Second Lien Mortgage Loan (1) that is delinquent 180 days or longer,
(2) for which the related first lien mortgage loan is not a Mortgage Loan, and
(3) as to which the applicable Servicer has certified to the Trustee that it
does not believe there is a reasonable likelihood that any further net
proceeds will be received or recovered with respect to such Second Lien
Mortgage Loan.
Liquidation Proceeds: Cash received in connection with the liquidation
of a Liquidated Mortgage Loan, whether through a trustee's sale, foreclosure
sale or otherwise, including any Subsequent Recoveries.
Loan-to-Value Ratio or LTV: With respect to any First Lien Mortgage
Loan, the ratio (expressed as a percentage) of the original outstanding
principal amount of the First Lien Mortgage Loan as of the Cut-off Date
(unless otherwise indicated), to the lesser of (a) the Appraised Value of the
Mortgaged Property at origination, and (b) if the First Lien Mortgage Loan was
made to finance the acquisition of the related Mortgaged Property, the
purchase price of the Mortgaged Property.
London Business Day: Any day on which dealings in deposits of United
States dollars are transacted in the London interbank market.
Lower Tier Interest Rate: As described in the Preliminary Statement.
Lower Tier Principal Amount: As described in the Preliminary
Statement.
Lower-Tier Regular Interest: Each of the Class LT-A-1, Class LT-A-2,
Class LT-A-3, Class LT-A-4, Class LT-M-1, Class LT-M-2, Class LT-M-3, Class
LT-M-4, Class LT-M-5, Class LT-M-6, Class LT-B-1, Class LT-B-2, Class LT-B-3,
Class LT-IO and Class LT-Accrual Interests as described in the Preliminary
Statement.
Lower Tier REMIC: As described in the Preliminary Statement.
Maximum Mortgage Rate: With respect to each Adjustable Rate Mortgage
Loan, a rate that (i) is set forth on the Data Tape Information and in the
related Mortgage Note and (ii) is the maximum interest rate to which the
Mortgage Rate on such Adjustable Rate Mortgage Loan may be increased during
the lifetime of such Adjustable Rate Mortgage Loan.
Minimum Mortgage Rate: With respect to each Adjustable Rate Mortgage
Loan, a rate that (i) is set forth on the Data Tape Information and in the
related Mortgage Note and (ii) is the minimum interest rate to which the
Mortgage Rate on such Adjustable Rate Mortgage Loan may be decreased during
the lifetime of such Adjustable Rate Mortgage Loan.
Monthly Statement: The statement delivered to the Certificateholders
pursuant to Section 4.03.
Moody's: ▇▇▇▇▇'▇ Investors Service, Inc, and its successors in
interest. If ▇▇▇▇▇'▇ is designated as a Rating Agency in the Preliminary
Statement, for purposes of Section 10.05(b) the address for notices to Moody's
shall be ▇▇▇▇▇'▇ Investors Service, Inc., ▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇
▇▇▇▇▇, Attention: Residential Mortgage Pass-Through
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Group, or such other address as Moody's may hereafter furnish to the
Depositor, the Trustee and the Servicers.
Mortgage: The mortgage, deed of trust or other instrument identified
on the Mortgage Loan Schedule as securing a Mortgage Note.
Mortgage File: The items pertaining to a particular Mortgage Loan
contained in either the Servicing File or Custodial File.
Mortgage Loan: An individual Mortgage Loan which is the subject of
this Agreement, each Mortgage Loan originally sold and subject to this
Agreement being identified on the Mortgage Loan Schedule, which Mortgage Loan
includes, without limitation, the Mortgage File, the Scheduled Payments,
Principal Prepayments, Liquidation Proceeds, Condemnation Proceeds, Insurance
Proceeds, REO Disposition proceeds, Prepayment Charges, and all other rights,
benefits, proceeds and obligations arising from or in connection with such
Mortgage Loan, excluding replaced or repurchased Mortgage Loans.
Mortgage Loan Schedule: A schedule of Mortgage Loans delivered to the
Trustee and referred to on Schedule I, such schedule setting forth the
following information with respect to each Mortgage Loan: (1) the Mortgage
Loan number; (2) the city, state and zip code of the Mortgaged Property; (3)
the number and type of residential units constituting the Mortgaged Property;
(4) the current Mortgage Rate; (5) the current net Mortgage Rate; (6) the
current Scheduled Payment; (7) with respect to each Adjustable Rate Mortgage
Loan, the Gross Margin; (8) the original term to maturity; (9) the scheduled
maturity date; (10) the principal balance of the Mortgage Loan as of the
Cut-off Date after deduction of payments of principal due on or before the
Cut-off Date whether or not collected; (11) with respect to each Adjustable
Rate Mortgage Loan, the next Interest Rate Adjustment Date; (12) with respect
to each Adjustable Rate Mortgage Loan, the lifetime Mortgage Interest Rate
Cap; (13) whether the Mortgage Loan is convertible or not; (14) the Servicing
Fee; (15) the date such Mortgage Loan was sold by the Responsible Party to the
Sponsor; (16) whether such Mortgage Loan provides for a Prepayment Charge as
well as the term and amount of such Prepayment Charge, if any; (17) with
respect to each First Lien Mortgage Loan, the LTV at origination and with
respect to each Second Lien Mortgage Loan, the CLTV at origination; (18) the
applicable Servicer's name; and (19) the date on which servicing of the
Mortgage Loan was transferred to the applicable Servicer.
Mortgage Note: The note or other evidence of the indebtedness of a
Mortgagor under a Mortgage Loan.
Mortgage Rate: The annual rate of interest borne on a Mortgage Note,
which shall be adjusted from time to time in the case of an Adjustable Rate
Mortgage Loan.
Mortgage Rate Caps: With respect to an Adjustable Rate Mortgage Loan,
the Periodic Mortgage Rate Cap, the Maximum Mortgage Rate, and the Minimum
Mortgage Rate for such Mortgage Loan.
Mortgaged Property: With respect to each Mortgage Loan, the real
property (or leasehold estate, if applicable) identified on the Mortgage Loan
Schedule as securing repayment of the debt evidenced by the related Mortgage
Note.
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Mortgagor: The obligor(s) on a Mortgage Note.
Net Monthly Excess Cash Flow: For any Distribution Date, the amount
remaining for distribution pursuant to subsection 4.02(a)(iii) (before giving
effect to distributions pursuant to such subsection).
Net Prepayment Interest Shortfall: For any Distribution Date, the
amount by which the sum of the Prepayment Interest Shortfalls for such
Distribution Date exceeds the sum of (i) all Prepayment Interest Excesses for
such Distribution Date and (ii) Compensating Interest payments made with
respect to such Distribution Date.
Net Swap Payment: With respect to any Distribution Date, any net
payment (other than a Swap Termination Payment) payable by the Trust to the
Swap Provider on the related Fixed Rate Payer Payment Date (as defined in the
Interest Rate Swap Agreement).
Net Swap Receipt: With respect to any Distribution Date, any net
payment (other than a Swap Termination Payment) made by the Swap Provider to
the Trust on the related Floating Rate Payer Payment Date (as defined in the
Interest Rate Swap Agreement).
NIM Issuer: The entity established as the issuer of the NIM
Securities.
NIM Securities: Any debt securities secured or otherwise backed by
some or all of the Class X and Class P Certificates that are rated by one or
more Rating Agencies.
NIM Trustee: The trustee for the NIM Securities.
Non-Delay Certificates: As specified in the Preliminary Statement.
Non-Permitted Transferee: A Person other than a Permitted Transferee.
Nonrecoverable P&I Advance: Any P&I Advance previously made or
proposed to be made in respect of a Mortgage Loan or REO Property that, in the
good faith business judgment of the applicable Servicer, will not or, in the
case of a proposed P&I Advance, would not be ultimately recoverable from
related late payments, Insurance Proceeds, Condemnation Proceeds, or
Liquidation Proceeds on such Mortgage Loan or REO Property as provided herein.
Nonrecoverable Servicing Advance: Any Servicing Advances previously
made or proposed to be made in respect of a Mortgage Loan or REO Property,
which, in accordance with Accepted Servicing Practices, will not or, in the
case of a proposed Servicing Advance, would not be ultimately recoverable from
related Insurance Proceeds, Condemnation Proceeds, Liquidation Proceeds or
otherwise.
Notice of Final Distribution: The notice to be provided pursuant to
Section 9.02 to the effect that final distribution on any of the Certificates
shall be made only upon presentation and surrender thereof.
Offered Certificates: As specified in the Preliminary Statement.
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Officer's Certificate: A certificate signed by an officer of any
Servicer or Subservicer with responsibility for the servicing of the Mortgage
Loans required to be serviced by such Servicer or Subservicer and listed on a
list delivered to the Trustee pursuant to this Agreement.
Opinion of Counsel: A written opinion of counsel, who may be in-house
counsel for a Servicer or a Subservicer, reasonably acceptable to the Trustee
(and/or such other Persons as may be set forth herein), provided, that any
Opinion of Counsel relating to (a) qualification of any Trust REMIC or (b)
compliance with the REMIC Provisions, must be (unless otherwise stated in such
Opinion of Counsel) an opinion of counsel who (i) is in fact independent of
such Servicer of the Mortgage Loans, (ii) does not have any material direct or
indirect financial interest in such Servicer of the Mortgage Loans or in an
Affiliate of either and (iii) is not connected with such Servicer of the
Mortgage Loans as an officer, employee, director or person performing similar
functions.
Optional Termination Date: The Distribution Date on which the
aggregate Stated Principal Balance of the Mortgage Loans, as of the last day
of the related Due Period, is equal to [__]% or less of the Cut-off Date Pool
Principal Balance.
Originator: The Responsible Party.
OTS: Office of Thrift Supervision, and any successor thereto.
Outstanding: With respect to the Certificates as of any date of
determination, all Certificates theretofore executed and authenticated under
this Agreement except:
(i) Certificates theretofore canceled by the Trustee or delivered to
the Trustee for cancellation; and\
(ii) Certificates in exchange for which or in lieu of which other
Certificates have been executed and delivered by the Trustee pursuant to
this Agreement.
Outstanding Mortgage Loan: As of any Due Date, a Mortgage Loan with a
Stated Principal Balance greater than zero which was not the subject of a
Principal Prepayment in Full prior to such Due Date and which did not become a
Liquidated Mortgage Loan prior to such Due Date.
Ownership Interest: As to any Residual Certificate, any ownership
interest in such Certificate including any interest in such Certificate as the
Holder thereof and any other interest therein, whether direct or indirect,
legal or beneficial.
P&I Advance: As to any Mortgage Loan or REO Property, any advance made
by the applicable Servicer in respect of any Remittance Date representing the
aggregate of all payments of principal and interest, net of the Servicing Fee,
that were due during the related Due Period on the Mortgage Loans and that
were delinquent on the related Determination Date, plus certain amounts
representing assumed payments not covered by any current net income on the
Mortgaged Properties acquired by foreclosure or deed in lieu of foreclosure as
determined pursuant to Section 4.01.
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Pass-Through Margin: With respect to each Class of Regular
Certificates except as set forth in the following sentence, the following
percentages: Class A-1 Certificates, [__]%; Class A-2 Certificates, [__]%;
Class A-3 Certificates, [__]%; Class A-4 Certificates, [__]%; Class M-1
Certificates, [__]%; Class M-2 Certificates, [__]%; Class M-3 Certificates,
[__]%; Class M-4 Certificates, [__]%; Class M-5 Certificates, [__]%; Class M-6
Certificates, [__]%; Class B-1 Certificates, [__]%; Class B-2 Certificates,
[__]%; and Class B-3 Certificates, [__]%. On the first Distribution Date after
the Optional Termination Date, the Pass-Through Margins shall increase to:
Class A-1 Certificates, [__]%; Class A-2 Certificates, [__]%; Class A-3
Certificates, [__]%; Class A-4 Certificates, [__]%; Class M-1 Certificates,
[__]%; Class M-2 Certificates, [__]%; Class M-3 Certificates, [__]%; Class M-4
Certificates, [__]%; Class M-5 Certificates, [__]%; Class M-6 Certificates,
[__]%; Class B-1 Certificates, [__]%; Class B-2 Certificates, [__]%; and Class
B-3 Certificates, [__]%.
Pass-Through Rate: For each Class of Regular Certificates, each
Pooling-Tier REMIC-1 Regular Interest, each Pooling-Tier REMIC-2 Regular
Interest, each Lower-Tier Regular Interest and each Upper-Tier Regular
Interest, the per annum rate set forth or calculated in the manner described
in the Preliminary Statement.
PCAOB: The Public Company Accounting Oversight Board.
Percentage Interest: As to any Certificate, the percentage interest
evidenced thereby in distributions required to be made on the related Class,
such percentage interest being set forth on the face thereof or equal to the
percentage obtained by dividing the Denomination of such Certificate by the
aggregate of the Denominations of all Certificates of the same Class.
Periodic Mortgage Rate Cap: With respect to an Adjustable Rate
Mortgage Loan, the periodic limit on each Mortgage Rate adjustment as set
forth in the related Mortgage Note.
Permitted Investments: Any one or more of the following obligations or
securities acquired at a purchase price of not greater than par, regardless of
whether issued by any Servicer, the Trustee or any of their respective
Affiliates:
(i) direct obligations of, or obligations fully guaranteed as to
timely payment of principal and interest by, the United States or any
agency or instrumentality thereof, provided such obligations are backed by
the full faith and credit of the United States;
(ii) 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 "P-1" by Moody's, "F1+" by
Fitch, and "A-1+" by Standard & Poor's (to the extent they are Rating
Agencies hereunder and are so rated by such Rating Agency);
(iii) repurchase obligations with respect to any security described in
clause (i) above entered into with a Depository Institution (acting as
principal);
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(iv) securities bearing interest or sold at a discount that are issued
by any corporation incorporated under the laws of the United States of
America or any State thereof and that are rated by each Rating Agency that
rates such securities in its highest long-term unsecured rating categories
at the time of such investment or contractual commitment providing for
such investment;
(v) commercial paper (including both non-interest-bearing discount
obligations and interest-bearing obligations payable on demand or on a
specified date not more than 30 days after the date of acquisition
thereof) that is rated by each Rating Agency that rates such securities in
its highest short-term unsecured debt rating available at the time of such
investment;
(vi) units of money market funds, including money market funds advised
by the Depositor, the Trustee or an Affiliate thereof, that have been
rated "Aaa" by Moody's, "AAAm" by Standard & Poor's and at least "AA" by
Fitch (to the extent they are Rating Agencies hereunder and such funds are
so rated by such Rating Agency); and
(vii) if previously confirmed in writing to the Trustee, any other
demand, money market or time deposit, or any other obligation, security or
investment, as may be acceptable to the Rating Agencies 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 [__]% of the yield to maturity at par of the underlying
obligations.
Permitted Transferee: Any Person other than (i) the United States, any
State or political subdivision thereof, or any agency or instrumentality of
any of the foregoing, (ii) a foreign government, international organization or
any agency or instrumentality of either of the foregoing, (iii) an
organization (except certain farmers' cooperatives described in Section 521 of
the Code) which is exempt from tax imposed by Chapter 1 of the Code (including
the tax imposed by Section 511 of the Code on unrelated business taxable
income) on any excess inclusions (as defined in Section 860E(c)(1) of the
Code) with respect to any Residual Certificate, (iv) rural electric and
telephone cooperatives described in Section 1381(a)(2)(C) of the Code, (v) a
Person that is not a U.S. Person or a U.S. Person with respect to whom income
from a Residual Certificate is attributable to a foreign permanent
establishment or fixed base, within the meaning of an applicable income tax
treaty, of such Person or any other U.S. Person, (vi) an "electing large
partnership" within the meaning of Section 775 of the Code and (vii) any other
Person so designated by the Depositor based upon an Opinion of Counsel that
the Transfer of an Ownership Interest in a Residual Certificate to such Person
may cause any Trust REMIC to fail to qualify as a REMIC at any time that the
Certificates are outstanding. The terms "United States", "State" and
"international organization" shall have the meanings set forth in Section 7701
of the Code or successor provisions. A corporation will not be treated as an
instrumentality of the United States or of any State or political subdivision
thereof for these
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purposes if all of its activities are subject to tax and, with the exception
of ▇▇▇▇▇▇▇ Mac, a majority of its board of directors is not selected by such
government unit.
Person: Any individual, corporation, partnership, joint venture,
association, limited liability company, joint-stock company, trust,
unincorporated organization or government, or any agency or political
subdivision thereof.
Physical Certificates: As specified in the Preliminary Statement.
Pool Stated Principal Balance: As to any Distribution Date, the
aggregate of the Stated Principal Balances of the Mortgage Loans for such
Distribution Date that were Outstanding Mortgage Loans on the Due Date in the
related Due Period.
Pooling-Tier Interest Rate: As specified in the Preliminary Statement.
Pooling-Tier REMIC-1: As described in the Preliminary Statement.
Pooling-Tier REMIC-1 Interest Rate: As described in the Preliminary
Statement.
Pooling-Tier REMIC-1 Principal Amount: As described in the Preliminary
Statement.
Pooling-Tier REMIC-1 Regular Interest: As described in the Preliminary
Statement.
Pooling-Tier REMIC-1 WAC Rate: With respect to the Mortgage Loans as
of any Distribution Date, a per annum rate equal to the weighted average of
the Adjusted Net Mortgage Rates for each such Mortgage Loan then in effect on
the beginning of the related Due Period on the Mortgage Loans, adjusted in
each case to accrue on the basis of a 360 day year and the actual number of
days in the related Interest Accrual Period.
Pooling-Tier REMIC-2: As described in the Preliminary Statement.
Pooling-Tier REMIC-2 Interest Rate: As described in the Preliminary
Statement.
Pooling-Tier REMIC-2 IO Interest: Any of the Pooling Tier REMIC-2
Regular Interests with the designation "IO" in its name.
Pooling-Tier REMIC-2 IO Notional Balance: As described in the
Preliminary Statement.
Pooling-Tier REMIC-2 Principal Amount: As described in the Preliminary
Statement.
Pooling-Tier REMIC-2 Regular Interest: As described in the Preliminary
Statement.
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Prepayment Charge: Any prepayment premium, penalty or charge collected
by any Servicer with respect to a Mortgage Loan from a Mortgagor in connection
with any voluntary Principal Prepayment pursuant to the terms of the related
Mortgage Note.
Prepayment Interest Excess: With respect to any Distribution Date, any
interest collected by the Servicer as to which a Principal Prepayment in Full
occurs from the 1st day of the month through the 15th day of the month in
which such Distribution Date occurs and that represents interest that accrues
from the 1st day of such month to the date of such Principal Prepayment in
Full.
Prepayment Interest Shortfall: With respect to any Distribution Date,
the sum of, for each Mortgage Loan that was, during the portion of the
Prepayment Period from and including the 16th day of the month preceding the
month in which such Distribution Date occurs (or from the day following the
Cut-off Date, in the case of the first Distribution Date) through the last day
of such month, the subject of a Principal Prepayment which is not accompanied
by an amount equal to one month of interest that would have been due on such
Mortgage Loan on the Due Date in the following month and which was applied by
the applicable Servicer to reduce the outstanding principal balance of such
Mortgage Loan on a date preceding such Due Date an amount equal to the product
of (a) the Mortgage Rate net of the Servicing Fee Rate for such Mortgage Loan,
(b) the amount of the Principal Prepayment for such Mortgage Loan, (c) 1/360
and (d) the number of days commencing on the date on which such Principal
Prepayment was applied and ending on the last day of the calendar month in
which the related Prepayment Period begins.
Prepayment Period: With respect to any Distribution Date either (i)
with respect to any voluntary Principal Prepayments in Full, the period from
and including the 16th day of the month preceding the month in which such
Distribution Date occurs (or, in the case of the first Distribution Date, from
and including the Cut-off Date) to and including the 15th day of the month in
which such Distribution Date occurs, or (ii) with respect to any other
Principal Prepayments, the calendar month preceding the month in which such
Distribution Date occurs.
Principal Distribution Amount: For any Distribution Date, the sum of
(i) the Basic Principal Distribution Amount for such Distribution Date and
(ii) the Extra Principal Distribution Amount for such Distribution Date.
Principal Prepayment: Any full or partial payment or other recovery of
principal on a Mortgage Loan (including upon liquidation of a Mortgage Loan)
which is received in advance of its scheduled Due Date, excluding any
Prepayment Charge thereon.
Principal Prepayment in Full: Any Principal Prepayment made by a
Mortgagor of the entire 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 and received by the
Servicers on or prior to the related Determination Date or advanced by the
applicable Servicer for the related Remittance Date, and all Principal
Prepayments
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received during the related Prepayment Period; (ii) all Liquidation Proceeds,
Condemnation Proceeds and Insurance Proceeds on the Mortgage Loans allocable
to principal actually collected by the Servicers during the related Prepayment
Period; (iii) the portion of the Repurchase Price allocable to principal with
respect to each Mortgage Loan, repurchased with respect to such Distribution
Date; (iv) all Substitution Adjustment Amounts allocable to principal received
in connection with the substitutions of Mortgage Loans with respect to such
Distribution Date; (v) with respect to the Distribution Date in [_______] 2006
only, the portion of the Closing Date Deposit Amount allocable to principal;
and (vi) the allocable portion of the proceeds received with respect to the
termination of the Trust Fund pursuant to clause (a) of Section 9.01 (to the
extent such proceeds relate to principal).
Private Certificates: As specified in the Preliminary Statement.
Prospectus Supplement: The Prospectus Supplement, dated [_______] ,
2006, relating to the Offered Certificates.
PTCE 95-60: As defined in Section 5.02(b).
Purchase Agreement: The Third Amended and Restated Mortgage Loan
Purchase and Warranties Agreement, dated as of [_______], 2005, between ▇▇▇▇▇▇
▇▇▇▇▇▇▇ Capital Inc. and [___________].
Rating Agency: Each of the Rating Agencies specified in the
Preliminary Statement. If such organization or a successor is no longer in
existence, "Rating Agency" shall be such nationally recognized statistical
rating organization, or other comparable Person, as is designated by the
Depositor, notice of which designation shall be given to the Trustee.
References herein to a given rating or rating category of a Rating Agency
shall mean such rating category without giving effect to any modifiers. For
purposes of Section 10.05(b), the addresses for notices to each Rating Agency
shall be the address specified therefor in the definition corresponding to the
name of such Rating Agency, or such other address as either such Rating Agency
may hereafter furnish to the Depositor, the Trustee and the Servicers.
Realized Losses: With respect to any date of determination and any
Liquidated Mortgage Loan, the amount, if any, by which (a) the unpaid
principal balance of such Liquidated Mortgage Loan together with accrued and
unpaid interest thereon exceeds (b) the Liquidation Proceeds with respect
thereto net of the expenses incurred by the applicable Servicer in connection
with the liquidation of such Liquidated Mortgage Loan and net of the amount of
unreimbursed Servicing Advances with respect to such Liquidated Mortgage Loan.
Record Date: With respect to any Distribution Date, the close of
business on the Business Day immediately preceding such Distribution Date;
provided, however, that, for any Certificate issued in definitive form, the
Record Date shall be the close of business on the last Business Day of the
month preceding the month in which such applicable Distribution Date occurs.
Reference Bank: As defined in Section 4.04.
Regular Certificates: As specified in the Preliminary Statement.
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Regulation AB: Subpart 229.1100 - Asset Backed Securities (Regulation
AB), 17 C.F.R. ss.ss.229.1100-229.1123, as such may be amended from time to
time, and subject to such clarification and interpretation as have been
provided by the Commission in the adopting release (Asset-Backed Securities,
Securities Act Release No. 33-8518, 70 Fed. Reg. 1,506, 1,531 (Jan. 7, 2005))
or by the staff of the Commission, or as may be provided by the Commission or
its staff from time to time.
Relief Act Interest Shortfall: With respect to any Distribution Date
and any Mortgage Loan, any reduction in the amount of interest collectible on
such Mortgage Loan for the most recently ended Due Period as a result of the
application of the Servicemembers Civil Relief Act or any similar state
statutes.
REMIC: A "real estate mortgage investment conduit" within the meaning
of Section 860D of the Code.
REMIC Provisions: Provisions of the federal income tax law relating to
real estate mortgage investment conduits, which appear at Sections 860A
through 860G of Subchapter M of Chapter 1 of the Code, and related provisions,
and regulations promulgated thereunder, as the foregoing may be in effect from
time to time as well as provisions of applicable state laws.
Remittance Date: With respect to any Distribution Date, the second
Business Day immediately preceding such Distribution Date.
REO Disposition: The final sale by the applicable Servicer of any REO
Property.
REO Imputed Interest: As to any REO Property, for any period, an
amount equivalent to interest (at the Mortgage Rate net of the Servicing Fee
Rate that would have been applicable to the related Mortgage Loan had it been
outstanding) on the unpaid principal balance of the Mortgage Loan as of the
date of acquisition thereof (as such balance is reduced pursuant to Section
3.17 by any income from the REO Property treated as a recovery of principal).
REO Mortgage Loan: A Mortgage Loan where title to the related
Mortgaged Property has been obtained by the applicable Servicer in the name of
the Trustee on behalf of the Certificateholders.
REO Property: A Mortgaged Property acquired by the Trust Fund through
foreclosure or deed-in-lieu of foreclosure in connection with a defaulted
Mortgage Loan.
Replacement Swap Provider Payment: Any payments that have been
received by the Trust as a result of entering into a replacement interest rate
swap agreement following an Additional Termination Event described in Part
1(h)(ii) of the Interest Rate Swap Agreement.
Reportable Event: As defined in Section 8.12(g).
Repurchase Price: With respect to any Mortgage Loan repurchased by the
Responsible Party, an amount equal to the sum of (i) the unpaid principal
balance of such Mortgage Loan as of the date of repurchase, (ii) interest on
such unpaid principal balance of such
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Mortgage Loan at the Mortgage Rate from the last date through which interest
has been paid and distributed to the Trustee to the date of repurchase, (iii)
all unreimbursed Servicing Advances and (iv) all costs and expenses incurred
by the Trustee arising out of or based upon such breach, including without
limitation, costs and expenses relating to the Trustee's enforcement of the
Responsible Party's repurchase obligation hereunder.
Request for Release: The Request for Release submitted by the
applicable Servicer to the Trustee, substantially in the form of Exhibit J.
Residual Certificates: As specified in the Preliminary Statement.
Responsible Officer: When used with respect to the Trustee, any
managing director, any vice president, any assistant vice president, any
assistant secretary, any assistant treasurer, any associate, or any other
officer of the Trustee customarily performing functions similar to those
performed by any of the above designated officers who at such time shall be
officers to whom, with respect to a particular matter, such matter is referred
because of such officer's knowledge of and familiarity with the particular
subject and who shall have direct responsibility for the administration of
this Agreement.
Responsible Party: [___________], a [STATE] corporation, and its
successors in interest.
Rule 144A Letter: As defined in Section 5.02(b).
Sarbanes Certification: As defined in Section 8.12(c).
Scheduled Payment: The scheduled monthly payment on a Mortgage Loan
due on any Due Date allocable to principal and/or interest on such Mortgage
Loan which, unless otherwise specified herein, shall give effect to any
related Debt Service Reduction and any Deficient Valuation that affects the
amount of the monthly payment due on such Mortgage Loan.
Second Lien Mortgage Loan: A Mortgage Loan secured by a second lien
Mortgage on the related Mortgaged Property.
Securities Act: The Securities Act of 1933, as amended.
Senior Defaulted Swap Termination Payment: As of any date, the lesser
of (x) any Replacement Swap Provider Payment and (y) any Swap Termination
Payment owed to the Swap Provider.
Senior Enhancement Percentage: With respect to any Distribution Date,
the percentage obtained by dividing (x) the sum of (i) the aggregate Class
Certificate Balance of the Subordinated Certificates and (ii) the Subordinated
Amount, in each case after taking into account the distribution of the
Principal Distribution Amount and any principal payments on those Classes of
Certificates from the Swap Account on that Distribution Date, by (y) the
aggregate Stated Principal Balance of the Mortgage Loans for such Distribution
Date.
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Senior Specified Enhancement Percentage: As of any date of
determination, [__]%.
Servicer: [_________] or [_______], as applicable, and if a successor
servicer to either is appointed hereunder, such successor. When the term
"Servicer" is used in this Agreement in connection with the administration of
servicing obligations with respect to any Mortgage Loan, Mortgaged Property,
REO Property or Mortgage File, "Servicer" shall mean the Person identified as
the Servicer of such Mortgage Loan on the Mortgage Loan Schedule.
Servicer Remittance Report: As defined in Section 4.03(d).
Servicing Advances: The reasonable "out-of-pocket" costs and expenses
(including legal fees) incurred by the applicable Servicer in the performance
of its servicing obligations in connection with a default, delinquency or
other unanticipated event, including, but not limited to, the cost of (i) the
preservation, restoration, inspection and protection of a Mortgaged Property,
(ii) any enforcement, administrative or judicial proceedings, including
foreclosures and litigation, in respect of a particular Mortgage Loan, (iii)
the management (including reasonable fees in connection therewith) and
liquidation of any REO Property and (iv) the performance of its obligations
under Sections 3.01, 3.09, 3.13 and 3.15. The Servicing Advances shall also
include any reasonable "out-of-pocket" costs and expenses (including legal
fees) incurred by the applicable Servicer in connection with executing and
recording instruments of satisfaction, deeds of reconveyance or Assignments of
Mortgage in connection with any foreclosure in respect of any Mortgage Loan to
the extent not recovered from the Mortgagor or otherwise payable under this
Agreement. Neither Servicer shall be required to make any Nonrecoverable
Servicing Advances.
Servicing Criteria: The "servicing criteria" set forth in Item 1122(d)
of Regulation AB, which as of the Closing Date are listed on Exhibit P hereto.
Servicing Fee: With respect to each Servicer, each Mortgage Loan
serviced by such Servicer and for any calendar month, an amount equal to one
month's interest (or in the event of any payment of interest which accompanies
a Principal Prepayment in Full made by the Mortgagor during such calendar
month, interest for the number of days covered by such payment of interest) at
the Servicing Fee Rate on the applicable Stated Principal Balance of such
Mortgage Loan as of the first day of such calendar month. Such fee shall be
payable monthly, and shall be pro-rated for any portion of a month during
which the Mortgage Loan is serviced by such Servicer under this Agreement. The
Servicing Fee is payable solely from the interest portion (including
recoveries with respect to interest from Liquidation Proceeds, Insurance
Proceeds, Condemnation Proceeds and proceeds received with respect to REO
Properties, to the extent permitted by Section 3.11) of such Scheduled Payment
collected by such Servicer, or as otherwise provided under Section 3.11.
Servicing Fee Rate: With respect to each Mortgage Loan, [__]% per
annum.
Servicing File: With respect to each Mortgage Loan, the file retained
by the applicable Servicer consisting of originals or copies of all documents
in the Mortgage File which
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are not delivered to the Trustee in the Custodial File and copies of the
Mortgage Loan Documents set forth in Exhibit K hereto.
Servicing Function Participant: As defined in Section 3.23(a).
Servicing Officer: Any officer of any Servicer involved in, or
responsible for, the administration and servicing of the Mortgage Loans whose
name and facsimile signature appear on a list of servicing officers furnished
to the Trustee by such Servicer on the Closing Date pursuant to this
Agreement, as such list may from time to time be amended.
Servicing Transfer Date: With respect to any Mortgage Loan, the date
on which servicing of such Mortgage Loan was transferred to the applicable
Servicer (as set forth on the Mortgage Loan Schedule).
Similar Law: As defined in Section 5.02(b).
60+ Day Delinquent Mortgage Loan: (i) Each Mortgage Loan with respect
to which any portion of a Scheduled Payment is, as of the last day of the
prior Due Period, two months or more past due (without giving effect to any
grace period), including, without limitation, such Mortgage Loans that are
subject to bankruptcy proceedings, (ii) each Mortgage Loan in foreclosure and
(iii) all REO Property.
Specified Subordinated Amount: Prior to the Stepdown Date, an amount
equal to [__]% of the Cut-off Date Pool Principal Balance. On and after the
Stepdown Date, an amount equal to [__]% of the aggregate Stated Principal
Balance of the Mortgage Loans for such Distribution Date, subject, until the
Class Certificate Balance of each Class of Offered Certificates has been
reduced to zero, to a minimum amount equal to [__]% of the Cut-off Date Pool
Principal Balance; provided, however, that if, on any Distribution Date, a
Trigger Event exists, the Specified Subordinated Amount shall not be reduced
to the applicable percentage of the then current aggregate Stated Principal
Balance of the Mortgage Loans until the Distribution Date on which a Trigger
Event no longer exists. When the Class Certificate Balance of each Class of
Offered Certificates has been reduced to zero, the Specified Subordinated
Amount will thereafter equal zero.
Sponsor: ▇▇▇▇▇▇ ▇▇▇▇▇▇▇ Mortgage Capital Inc., a New York corporation,
and its successors in interest, as purchaser of the Mortgage Loans under each
of the Purchase Agreements.
Standard & Poor's: Standard & Poor's Ratings Services, a division of
The ▇▇▇▇▇▇-▇▇▇▇ Companies, Inc., and its successors in interest. If Standard &
Poor's is designated as a Rating Agency in the Preliminary Statement, for
purposes of Section 10.05(b) the address for notices to Standard & Poor's
shall be Standard & Poor's, ▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇,
Attention: Residential Mortgage Surveillance Group - ▇▇▇▇▇▇ ▇▇▇▇▇▇▇ ABS
Capital I Inc. Trust 2006-[___], or such other address as Standard & Poor's
may hereafter furnish to the Depositor, the Trustee and the Servicers.
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Standard & Poor's Glossary: The Standard & Poor's LEVELS(R) Glossary,
as may be in effect from time to time.
Startup Day: The Closing Date.
Stated Principal Balance: As to each Mortgage Loan and as of any date
of determination, (i) the principal balance of the Mortgage Loan at the
Cut-off Date after giving effect to payments of principal due on or before
such date (whether or not received), minus (ii) all amounts previously
remitted to the Trustee with respect to the related Mortgage Loan representing
payments or recoveries of principal including advances in respect of scheduled
payments of principal. For purposes of any Distribution Date, the Stated
Principal Balance of any Mortgage Loan will give effect to any scheduled
payments of principal received by the related Servicer on or prior to the
related Determination Date or advanced by the related Servicer for the related
Remittance Date and any unscheduled principal payments and other unscheduled
principal collections received during the related Prepayment Period, and the
Stated Principal Balance of any Mortgage Loan that has prepaid in full or has
become a Liquidated Mortgage Loan during the related Prepayment Period shall
be zero.
Stepdown Date: The later to occur of (i) the earlier to occur of (a)
the Distribution Date in [_______] 2009 and (b) the Distribution Date
following the Distribution Date on which the aggregate Class Certificate
Balances of the Class A Certificates have been reduced to zero and (ii) the
first Distribution Date on which the Senior Enhancement Percentage (calculated
for this purpose only after taking into account payments of principal on the
Mortgage Loans applied to reduce the Stated Principal Balances of the Mortgage
Loans for the applicable Distribution Date but prior to any allocation of the
Principal Distribution Amount and principal payments from the Swap Account to
the Certificates on such Distribution Date) is greater than or equal to the
Senior Specified Enhancement Percentage.
Subcontractor: Any third-party or Affiliated vendor, subcontractor or
other Person utilized by a Servicer, a Subservicer or the Trustee, as
applicable, that is not responsible for the overall servicing (as "servicing"
is commonly understood by participants in the mortgage-backed securities
market) of Mortgage Loans but performs one or more discrete functions
identified in Item 1122(d) of Regulation AB with respect to Mortgage Loans.
Subordinated Amount: With respect to any Distribution Date, the
excess, if any, of (a) the aggregate Stated Principal Balance of the Mortgage
Loans for such Distribution Date over (b) the aggregate of the Class
Certificate Balances of the Offered Certificates as of such Distribution Date
(after giving effect to the payment of the Principal Remittance Amount on such
Certificates on such Distribution Date).
Subordinated Certificates: As specified in the Preliminary Statement.
Subordination Deficiency: With respect to any Distribution Date, the
excess, if any, of (a) the Specified Subordinated Amount applicable to such
Distribution Date over (b) the Subordinated Amount applicable to such
Distribution Date.
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Subordination Reduction Amount: With respect to any Distribution Date,
an amount equal to the lesser of (a) the Excess Subordinated Amount and (b)
the Net Monthly Excess Cash Flow.
Subsequent Recovery: With respect to any Mortgage Loan or related
Mortgaged Property that became a Liquidated Mortgage Loan or was otherwise
disposed of, all amounts received in respect of such Liquidated Mortgage Loan
after an Applied Realized Loss Amount related to such Mortgage Loan or
Mortgaged Property is allocated to reduce the Class Certificate Balance of any
Class of Subordinated Certificates. Any Subsequent Recovery that is received
during a Prepayment Period will be treated as Liquidation Proceeds and
included as part of the Principal Remittance Amount for the related
Distribution Date.
Subservicer: Any Person that services Mortgage Loans on behalf of a
Servicer or any Subservicer and is responsible for the performance (whether
directly or through Subservicers or Subcontractors) of a substantial portion
of the material servicing functions required to be performed by a Servicer
under this Agreement, with respect to some or all of the Mortgage Loans, that
are identified in Item 1122(d) of Regulation AB.
Subservicing Account: As defined in Section 3.08.
Subservicing Agreements: As defined in Section 3.02(a).
Substitute Mortgage Loan: A Mortgage Loan substituted by the
Responsible Party for a Deleted Mortgage Loan that satisfies the criteria set
forth in the definition of "Qualified Substitute Mortgage Loan" in the
applicable Purchase Agreement, which, must, on the date of such substitution,
as confirmed in a Request for Release, substantially in the form of Exhibit J,
(i) have a Stated Principal Balance, after deduction of the principal portion
of the Scheduled Payment due in the month of substitution, not in excess of,
and not more than [__]% less than, the Stated Principal Balance of the Deleted
Mortgage Loan; (ii) be accruing interest at a rate no lower than and not more
than [__]% per annum higher than, that of the Deleted Mortgage Loan; (iii)
have a Loan-to-Value Ratio or a Combined Loan-to-Value Ratio, as applicable,
no higher than that of the Deleted Mortgage Loan; (iv) have a remaining term
to maturity no greater than (and not more than one year less than that of) the
Deleted Mortgage Loan; and (v) comply with each representation and warranty
set forth in Section 2.03.
Substitution Adjustment Amount: As defined in Section 2.03.
Swap Account: As defined in Section 4.06.
Swap Assets: Collectively, the Swap Account, the Interest Rate Swap
Agreement, the Class IO Interest and the right to receive Class IO Shortfalls,
subject to the obligation to pay amounts specified in Section 4.06.
Swap LIBOR: With respect to any Distribution Date (and the related
Interest Accrual Period), the product of (i) USD-LIBOR-BBA (as used in the
Interest Swap Agreement), (ii) two, and (iii) the quotient of (a) the actual
number of days in the Interest Accrual Period for the Offered Certificates
divided by (b) 30.
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Swap Payment Allocation: For any Class of Certificates and any
Distribution Date, that Class's pro rata share of the Net Swap Receipts, if
any, for that Distribution Date, based on the Class Certificate Balances of
the Classes of Certificates.
Swap Payment Rate: For any Distribution Date, a fraction, the
numerator of which is any Net Swap Payment or Swap Termination Payment owed to
the Swap Provider for such Distribution Date and the denominator of which is
the aggregate Stated Principal Balance of the Mortgage Loans at the beginning
of the related Due Period, multiplied by 12.
Swap Provider: [________________], a [STATE] corporation, and its
successors in interest.
Swap Termination Payment: Any payment payable by the Trust or the Swap
Provider upon termination of the Interest Rate Swap Agreement as a result of
an Event of Default (as defined in the Interest Rate Swap Agreement) or a
Termination Event (as defined in the Interest Rate Swap Agreement).
Tax Matters Person: The Holder of the Class R Certificates designated
as "tax matters person" of each Trust REMIC in the manner provided under
Treasury Regulations Section 1.860F-4(d) and Treasury Regulations Section
301.6231(a)(7)-1.
Tax Service Contract: As defined in Section 3.09(a).
Telerate Page 3750: The display page currently so designated on the
Bridge Telerate Service (or such other page as may replace that page on that
service for displaying comparable rates or prices).
Total Monthly Excess Spread: As to any Distribution Date, an amount
equal to the excess if any, of (i) the interest on the Mortgage Loans received
by the Servicers on or prior to the related Determination Date (other than
Prepayment Interest Excesses) or advanced by the Servicers for the related
Remittance Date (net of Expense Fees) over (ii) the sum of (A) the amounts
payable to the Certificates pursuant to Section 4.02(a)(i) on such
Distribution Date and (B) any Net Swap Payments to the Swap Provider.
Transfer: Any direct or indirect transfer or sale of any Ownership
Interest in a Residual Certificate.
Transfer Affidavit: As defined in Section 5.02(c).
Transferor Certificate: As defined in Section 5.02(b).
Trigger Event: Either a Cumulative Loss Trigger Event or a Delinquency
Trigger Event.
Trust: The express trust created hereunder in Section 2.01(c).
Trust Fund: The corpus of the trust created hereunder consisting of
(i) the Mortgage Loans and all interest and principal with respect thereto
received on or after the related
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Cut-off Date, other than such amounts which were due on the Mortgage Loans on
or prior to the related Cut-off Date; (ii) the Collection Accounts, Excess
Reserve Fund Account, the Distribution Account, and all amounts deposited
therein pursuant to the applicable provisions of this Agreement; (iii)
property that secured a Mortgage Loan and has been acquired by foreclosure,
deed-in-lieu of foreclosure or otherwise; (iv) the Closing Date Deposit
Amount; (v) the Swap Assets; and (vii) all proceeds of the conversion,
voluntary or involuntary, of any of the foregoing.
Trust REMIC: Any of Pooling-Tier REMIC-1, Pooling-Tier REMIC-2, the
Lower-Tier REMIC or the Upper-Tier REMIC, as applicable.
Trustee: [_______________], a national banking association, and its
successors in interest and, if a successor trustee is appointed hereunder,
such successor.
Trustee Fee: As to any Distribution Date, an amount equal to the
product of (a) one-twelfth of the Trustee Fee Rate and (b) (i) the aggregate
Stated Principal Balance of the Mortgage Loans as of the first day of the
related Interest Accrual Period and (ii) with respect to the Distribution Date
in [_______] 2006 only, the portion of the Closing Date Deposit Amount
allocable to principal.
Trustee Fee Rate: With respect to each Mortgage Loan, [__]% per annum.
Trustee Float Period: With respect to the Distribution Date and the
related amounts in the Distribution Account, the period commencing on the
Business Day immediately preceding such Distribution Date and ending on such
Distribution Date.
Underwriters' Exemption: Any exemption listed under footnote 1 of, and
amended by, Prohibited Transaction Exemption 2002-41, 67 Fed. Reg. 54487
(2002), or any successor exemption.
Underwriting Guidelines: The underwriting guidelines attached to the
Purchase Agreement.
Unpaid Interest Amount: As of any Distribution Date and any Class of
Certificates, the sum of (a) the portion of the Accrued Certificate Interest
Distribution Amount from Distribution Dates prior to the current Distribution
Date remaining unpaid immediately prior to the current Distribution Date and
(b) interest on the amount in clause (a) above at the applicable Pass-Through
Rate (to the extent permitted by applicable law).
Unpaid Realized Loss Amount: With respect to any Class of Subordinated
Certificates and as to any Distribution Date, is the excess of (i) the Applied
Realized Loss Amount with respect to such Class over (ii) the sum of (a) all
distributions in reduction of such Applied Realized Loss Amounts on all
previous Distribution Dates, and (b) the amount by which the Class Certificate
Balance of such Class has been increased due to the distribution of any
Subsequent Recoveries on all previous Distribution Dates. Any amounts
distributed to a Class of Subordinated Certificates in respect of any Unpaid
Realized Loss Amount will not be applied to reduce the Class Certificate
Balance of such Class.
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▇▇▇▇▇-▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇: With respect to each Class of Offered
Certificates, as of any Distribution Date, the sum of (A) if on such
Distribution Date the Upper-Tier Interest Rate for the Class of Corresponding
Upper-Tier REMIC Regular Interest is based upon the Upper-Tier REMIC WAC Rate,
the excess, if any, of (i) the amount of interest such Class of Upper-Tier
Regular Interest would otherwise be entitled to receive on such Distribution
Date had such Upper-Tier REMIC Regular Interest not been subject to the
Upper-Tier REMIC WAC Rate, over (ii) the amount of interest payable on such
Class of Certificates on such Distribution Date taking into account the
Upper-Tier REMIC WAC Rate and (B) the Upper-Tier Carry Forward Amount for such
Class of Certificates for all previous Distribution Dates not previously paid,
together with interest thereon at a rate equal to the applicable Upper-Tier
Interest Rate for such Class of Certificates for such Distribution Date,
without giving effect to the Upper-Tier REMIC WAC Rate.
Upper-Tier Interest Rate: As described in the Preliminary Statement.
Upper-Tier Regular Interest: As described in the Preliminary
Statement.
Upper-Tier REMIC: As described in the Preliminary Statement.
Upper-Tier REMIC WAC Rate: For any Distribution Date, the weighted
average of the Lower-Tier Interest Rates on the Lower-Tier Regular Interests
(other than the Class LT-IO Interest) as of the first day of the related
Interest Accrual Period, weighted on the basis of the Lower-Tier Principal
Amounts of such Lower-Tier Regular Interests as of the first day of the
related Interest Accrual Period.
U.S. Person: (i) A citizen or resident of the United States; (ii) a
corporation (or entity treated as a corporation for tax purposes) created or
organized in the United States or under the laws of the United States or of
any State thereof, including, for this purpose, the District of Columbia;
(iii) a partnership (or entity treated as a partnership for tax purposes)
organized in the United States or under the laws of the United States or of
any State thereof, including, for this purpose, the District of Columbia
(unless provided otherwise by future Treasury regulations); (iv) an estate
whose income is includible in gross income for United States income tax
purposes regardless of its source; or (v) 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 U.S. Persons have authority to control
substantial decisions of the trust. Notwithstanding the last clause of the
preceding sentence, to the extent provided in Treasury regulations, certain
trusts in existence on August 20, 1996, and treated as U.S. Persons prior to
such date, may elect to continue to be U.S. Persons.
Voting Rights: The portion of the voting rights of all of the
Certificates which is allocated to any Certificate. As of any date of
determination, (a) [__]% of all Voting Rights shall be allocated to the Class
X Certificates, if any (such Voting Rights to be allocated among the holders
of Certificates of each such Class in accordance with their respective
Percentage Interests), (b) [__]% of all Voting Rights shall be allocated to
the Class P Certificates, if any, and (c) the remaining Voting Rights shall be
allocated among Holders of the remaining Classes of Certificates in proportion
to the Certificate Balances of their respective Certificates on such date.
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WAC Cap: With respect to the Mortgage Loans as of any Distribution
Date, the weighted average of the Adjusted Net Mortgage Rates then in effect
on the beginning of the related Due Period on the Mortgage Loans minus the
Swap Payment Rate, adjusted in each case to accrue on the basis of a 360-day
year and the actual number of days in the related Interest Accrual Period.
ARTICLE II
CONVEYANCE OF MORTGAGE LOANS;
REPRESENTATIONS AND WARRANTIES
Section 2.01 Conveyance of Mortgage Loans. (a) The Depositor,
concurrently with the execution and delivery hereof, hereby sells, transfers,
assigns, sets over and otherwise conveys to the Trustee for the benefit of the
Certificateholders, without recourse, all the right, title and interest of the
Depositor in and to the Trust Fund, and the Trustee, on behalf of the Trust,
hereby accepts the Trust Fund.
(b) In connection with the transfer and assignment of each Mortgage
Loan, the Depositor has delivered or caused to be delivered to the Trustee for
the benefit of the Certificateholders the following documents or instruments
with respect to each Mortgage Loan so assigned:
(i) the original Mortgage Note bearing all intervening endorsements
showing a complete chain of endorsement from the originator to the last
endorsee, endorsed "Pay to the order of _____________, without recourse"
and signed (which may be by facsimile signature) in the name of the last
endorsee by an authorized officer. To the extent that there is no room on
the face of a Mortgage Note for endorsements, the endorsement may be
contained on an allonge, unless the Trustee is advised in writing by the
Responsible Party, that state law does not so allow;
(ii) the original of any guaranty executed in connection with the
Mortgage Note;
(iii) the original Mortgage with evidence of recording thereon or a
certified true copy of such Mortgage submitted for recording. If, in
connection with any Mortgage Loan, the original Mortgage cannot be
delivered with evidence of recording thereon on or prior to the Closing
Date because of a delay caused by the public recording office where such
Mortgage has been delivered for recordation or because such Mortgage has
been lost or because such public recording office retains the original
recorded Mortgage, the Responsible Party, shall deliver or cause to be
delivered to the Trustee a photocopy of such Mortgage, together with (A)
in the case of a delay caused by the public recording office, an
officer's certificate of the Responsible Party or evidence of
certification on the face of such photocopy of such Mortgage or a
certificate from an escrow company, a title company or closing attorney
stating that such Mortgage has been dispatched to the appropriate public
recording office for recordation and that the original recorded Mortgage
or a copy of such Mortgage certified by such public recording office to
be a true and complete copy of the original recorded Mortgage will be
promptly delivered to
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the Trustee upon receipt thereof by the Responsible Party; or (B) in the
case of a Mortgage where a public recording office retains the original
recorded Mortgage or in the case where a Mortgage is lost after
recordation in a public recording office, a copy of such Mortgage
certified by such public recording office to be a true and complete copy
of the original recorded Mortgage;
(iv) the originals of all assumption, modification, consolidation or
extension agreements, with evidence of recording thereon or a certified
true copy of such agreement submitted for recording;
(v) the original Assignment of Mortgage for each Mortgage Loan
endorsed in blank;
(vi) the originals of all intervening assignments of Mortgage (if any)
evidencing a complete chain of assignment from the applicable originator
to the last endorsee with evidence of recording thereon or a certified
true copy of such intervening assignments of Mortgage submitted for
recording, or if any such intervening assignment has not been returned
from the applicable recording office or has been lost or if such public
recording office retains the original recorded assignments of Mortgage,
the Responsible Party, shall deliver or cause to be delivered a photocopy
of such intervening assignment, together with (A) in the case of a delay
caused by the public recording office, an officer's certificate of the
Responsible Party or evidence of certification on the face of such
photocopy of such intervening assignment or a certificate from an escrow
company, a title company or a closing attorney stating that such
intervening assignment of Mortgage has been dispatched to the appropriate
public recording office for recordation and that such original recorded
intervening assignment of Mortgage or a copy of such intervening
assignment of Mortgage certified by the appropriate public recording
office to be a true and complete copy of the original recorded
intervening assignment of Mortgage will be promptly delivered to the
Trustee upon receipt thereof by the Responsible Party; or (B) in the case
of an intervening assignment where a public recording office retains the
original recorded intervening assignment or in the case where an
intervening assignment is lost after recordation in a public recording
office, a copy of such intervening assignment certified by such public
recording office to be a true and complete copy of the original recorded
intervening assignment;
(vii) the original mortgagee title insurance policy or, in the event
such original title policy is unavailable, a certified true copy of the
related policy binder or commitment for title certified to be true and
complete by the title insurance company; and
(viii) the original of any security agreement, chattel mortgage or
equivalent document executed in connection with the Mortgage (if
provided).
The Responsible Party shall cause to be delivered to the Trustee the
applicable recorded document promptly upon receipt from the respective
recording office but in no event later than 120 days from the Closing Date.
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From time to time, the Depositor or the applicable Servicer, as
applicable, shall forward to the Trustee, additional original documents,
additional documents evidencing an assumption, modification, consolidation or
extension of a Mortgage Loan, in accordance with the terms of this Agreement
upon receipt of such documents. All such mortgage documents held by the
Trustee as to each Mortgage Loan shall constitute the "Custodial File".
On or prior to the Closing Date, the Responsible Party shall deliver
to the Trustee, Assignments of Mortgage, in blank, for each Mortgage Loan. The
Responsible Party shall cause the Assignments of Mortgage and complete
recording information to be provided to the applicable Servicer in a
reasonably acceptable manner. No later than thirty (30) Business Days
following the later of the Closing Date and the date of receipt by the
applicable Servicer of the complete recording information for a Mortgage, the
applicable Servicer shall promptly submit or cause to be submitted for
recording, at the expense of the Responsible Party and at no expense to the
Trust Fund, the Trustee, the applicable Servicer, or the Depositor, in the
appropriate public office for real property records, each Assignment of
Mortgage referred to in Section 2.01(b)(v). Notwithstanding the foregoing,
however, for administrative convenience and facilitation of servicing and to
reduce closing costs, the Assignments of Mortgage shall not be required to be
completed and submitted for recording with respect to any Mortgage Loan (i) if
the Trustee and each Rating Agency have received an Opinion of Counsel,
satisfactory in form and substance to the Trustee and each Rating Agency to
the effect that the recordation of such Assignments of Mortgage in any
specific jurisdiction is not necessary to protect the Trustee's interest in
the related Mortgage Note or (ii) the Rating Agencies have each notified the
Depositor in writing that not recording any such Assignments of Mortgage would
not cause the initial ratings on any Offered Certificates to be downgraded or
withdrawn; provided, however, that no Servicer shall be held responsible or
liable for any loss that occurs because an Assignment of Mortgage was not
recorded, but only to the extent the applicable Servicer does not have prior
knowledge of the act or omission that causes such loss. However, with respect
to the Assignments of Mortgage referred to in clauses (i) and (ii) above, if
foreclosure proceedings occur against a Mortgaged Property, the Depositor
shall notify the applicable Servicer and such Servicer shall record such
Assignment of Mortgage at the expense of the Responsible Party (at no expense
to the applicable Servicer) as required pursuant to the Purchase Agreement. If
the Assignment of Mortgage is to be recorded, the Mortgage shall be assigned
to "[_______________], as trustee under the Pooling and Servicing Agreement
dated as of [_______] , 2006, ▇▇▇▇▇▇ ▇▇▇▇▇▇▇ ABS Capital I Inc. Trust
2006-[___]". In the event that any such Assignment of Mortgage is lost or
returned unrecorded because of a defect therein, the Responsible Party shall
promptly cause to be delivered a substitute Assignment of Mortgage to cure
such defect and thereafter cause each such assignment to be duly recorded.
In the event that such original or copy of any document submitted for
recordation to the appropriate public recording office is not so delivered to
the Trustee within 90 days following the Closing Date, and in the event that
the Responsible Party does not cure such failure within 30 days of discovery
or receipt of written notification of such failure from the Depositor, the
related Mortgage Loan shall, upon the request of the Depositor, be repurchased
by the Responsible Party at the price and in the manner specified in Section
2.03. The foregoing repurchase obligation shall not apply in the event that
the Responsible Party cannot deliver such original or copy of any document
submitted for recordation to the appropriate public recording office within
the specified period due to a delay caused by the recording office in the
applicable
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jurisdiction; provided, that the Responsible Party shall instead deliver a
recording receipt of such recording office or, if such recording receipt is
not available, an officer's certificate of an officer of the Responsible
Party, confirming that such document has been accepted for recording.
Notwithstanding anything to the contrary contained in this Section
2.01, in those instances where the public recording office retains or loses
the original Mortgage or assignment after it has been recorded, the
obligations of the Responsible Party shall be deemed to have been satisfied
upon delivery by the Responsible Party to the Trustee, prior to the Closing
Date of a copy of such Mortgage or assignment, as the case may be, certified
(such certification to be an original thereof) by the public recording office
to be a true and complete copy of the recorded original thereof. (c) The
Depositor does hereby establish, pursuant to the further provisions of this
Agreement and the laws of the State of New York, an express trust (the
"Trust") to be known, for convenience, as "▇▇▇▇▇▇ ▇▇▇▇▇▇▇ ABS CAPITAL I INC.
TRUST 2006-[___]" and [_______________] is hereby appointed as Trustee in
accordance with the provisions of this Agreement. The parties hereto
acknowledge and agree that it is the policy and intention of the Trust to
acquire only Mortgage Loans meeting the requirements set forth in this
Agreement, including without limitation, the representation and warranty set
forth in paragraph (46) of Schedule III. The Trust's fiscal year is the
calendar year. (d) The Trust shall have the capacity, power and authority, and
the Trustee on behalf of the Trust is hereby authorized, to accept the sale,
transfer, assignment, set over and conveyance by the Depositor to the Trust of
all the right, title and interest of the Depositor in and to the Trust Fund
(including, without limitation, the Mortgage Loans) pursuant to Section
2.01(a). The Trustee on behalf of the Trust is hereby directed to enter into
the Interest Rate Swap Agreement. Section 2.02......Acceptance by the Trustee
of the Mortgage Loans. The Trustee shall acknowledge, on the Closing Date,
receipt by the Trustee, of the documents identified in the Initial
Certification in the form annexed hereto as Exhibit E, and declares that it
holds and will hold such documents and the other documents delivered to it
pursuant to Section 2.01, and that it holds or will hold such other assets as
are included in the Trust Fund, in trust for the exclusive use and benefit of
all present and future Certificateholders. The Trustee shall maintain
possession of the related Mortgage Notes in the State of [STATE] unless
otherwise permitted by the Rating Agencies.
In connection with the Closing Date, the Trustee shall be required to
deliver via facsimile (with original to follow the next Business Day) to the
Depositor and the Servicers an Initial Certification prior to the Closing
Date, or, as the Depositor agrees to, on the Closing Date, certifying receipt
of a Mortgage Note and Assignment of Mortgage for each applicable Mortgage
Loan. The Trustee shall not be responsible to verify the validity, sufficiency
or genuineness of any document in any Custodial File.
Within 90 days after the Closing Date, the Trustee shall, for the
benefit of the Holders of the Certificates, ascertain that all documents
identified in the Document Certification and Exception Report in the form
attached hereto as Exhibit F are in its possession, and shall
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deliver to the Depositor and the Servicers a Document Certification and
Exception Report, in the form annexed hereto as Exhibit F, to the effect that,
as to each Mortgage Loan listed in the Mortgage Loan Schedule (other than any
Mortgage Loan paid in full or any Mortgage Loan specifically identified in
such certification as an exception and not covered by such certification): (i)
all documents identified in the Document Certification and Exception Report
and required to be reviewed by it are in its possession; (ii) such documents
have been reviewed by it and appear regular on their face and relate to such
Mortgage Loan; (iii) based on its examination and only as to the foregoing
documents, the information set forth in items (1), (2), (7) and (9) of the
Mortgage Loan Schedule and items (1), (9) and (17) of the Data Tape
Information respecting such Mortgage Loan is correct; and (iv) each Mortgage
Note has been endorsed as provided in Section 2.01 of this Agreement. The
Trustee shall not be responsible to verify the validity, sufficiency or
genuineness of any document in any Custodial File.
The Trustee shall retain possession and custody of each Custodial File
in accordance with and subject to the terms and conditions set forth herein.
The applicable Servicer shall promptly deliver to the Trustee, upon the
execution or receipt thereof, the originals of such other documents or
instruments constituting the Custodial File as come into the possession of the
Servicer from time to time.
The Responsible Party shall deliver to the applicable Servicer copies
of all trailing documents required to be included in the Custodial File at the
same time the original or certified copies thereof are delivered to the
Trustee, including but not limited to such documents as the title insurance
policy and any other Mortgage Loan Documents upon return from the public
recording office. Such documents shall be delivered by the Responsible Party
at the Responsible Party's expense to such Servicer.
Section 2.03 Representations and Warranties; Remedies for Breaches of
Representations and Warranties with Respect to the Mortgage Loans. (a)
[______] hereby makes the representations and warranties set forth in Schedule
II hereto to the Depositor and the Trustee, as of the dates set forth in such
Schedule and [_________] hereby makes the representations and warranties set
forth in Schedule IV hereto to the Depositor and the Trustee as of the dates
set forth in such Schedule. Upon discovery by any of the parties hereto of a
breach of any of the foregoing representations and warranties, the party
discovering such breach shall give prompt written notice to the other.
(b) The Responsible Party hereby makes the representations and
warranties, set forth in Schedule III and Schedule V hereto, to the Depositor
and the Trustee as of the dates set forth in such Schedules.
(c) It is understood and agreed by the parties hereto that the
representations and warranties set forth in this Section 2.03 shall survive
the transfer of the Mortgage Loans by the Depositor to the Trustee, and shall
inure to the benefit of the parties to whom the representations and warranties
were made notwithstanding any restrictive or qualified endorsement on any
Mortgage Note or Assignment of Mortgage or the examination or failure to
examine any Mortgage File. Upon discovery by any of the Responsible Party, the
Depositor, the Trustee or a Servicer of a breach of any of the foregoing
representations and warranties, the party discovering such breach shall give
prompt written notice to the others.
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(d) Within 30 days of the earlier of either discovery by or notice to
the Responsible Party that any Mortgage Loan does not conform to the
requirements as determined in the Trustee's review of the related Custodial
File or within 60 days of the earlier of either discovery by or notice to the
Responsible Party of any breach of a representation or warranty, set forth in
Section 2.03(b), that materially and adversely affects the value of any
Mortgage Loan or the interest of the Trustee or the Certificateholders
therein, the Responsible Party shall use its best efforts to cause to be
remedied a material defect in a document constituting part of a Mortgage File
or promptly to cure such breach in all material respects and, if such defect
or breach cannot be remedied, the Responsible Party shall, at the Depositor's
option as specified in writing and provided to the Responsible Party and the
Trustee, (i) if such 30 or 60 day period, as applicable, expires prior to the
second anniversary of the Closing Date, remove such Mortgage Loan (a "Deleted
Mortgage Loan") from the Trust Fund and substitute in its place a Substitute
Mortgage Loan, in the manner and subject to the conditions set forth in this
Section 2.03; or (ii) repurchase such Mortgage Loan at the Repurchase Price;
provided, however, that any such substitution pursuant to clause (i) above
shall not be effected prior to the delivery to the Trustee of a Request for
Release substantially in the form of Exhibit J, and the delivery of the
Mortgage File to the Trustee for any such Substitute Mortgage Loan.
Notwithstanding the foregoing, a breach (i) which causes a Mortgage Loan not
to constitute a "qualified mortgage" within the meaning of Section 860G(a)(3)
of the Code or (ii) by the Responsible Party of any of the representations and
warranties set forth in clause (46), (47), (49), (53), (55), (56), (57), (58),
(59), (60), (61), (62) or (63) of Schedule III, in each case, will be deemed
automatically to materially and adversely affect the value of such Mortgage
Loan and the interests of the Trustee and Certificateholders in such Mortgage
Loan. In the event that the Trustee receives notice of a breach by the
Responsible Party of any of the representations and warranties set forth in
clause (46), (47), (49), (53), (55), (56), (57), (58), (59), (60), (61), (62)
or (63) of Schedule III, the Trustee shall give notice of such breach to the
Responsible Party and request the Responsible Party to repurchase the Mortgage
Loan at the Repurchase Price within sixty (60) days of the Responsible Party
receipt of such notice. The Responsible Party shall repurchase each such
Mortgage Loan within 60 days of the earlier of discovery or receipt of notice
with respect to each such Mortgage Loan, and in any case such repurchase shall
occur or shall be deemed to occur on the last day of the applicable Prepayment
Period preceding the Distribution Date on which the Repurchase Price is to be
distributed.
(e) With respect to any Substitute Mortgage Loan or Loans, the
Responsible Party shall deliver to the Trustee for the benefit of the
Certificateholders the Mortgage Note, the Mortgage, the related Assignment of
Mortgage, and such other documents and agreements as are required by Section
2.01, with the Mortgage Note endorsed and the Mortgage assigned as required by
Section 2.01. No substitution under this Agreement is permitted to be made in
any calendar month after the Determination Date for such month. Scheduled
Payments due with respect to Substitute Mortgage Loans in the Due Period of
substitution shall not be part of the Trust Fund and will be retained by the
Responsible Party on the next succeeding Distribution Date. For the Due Period
of substitution, distributions to Certificateholders will include the
Scheduled Payment due on any Deleted Mortgage Loan for such Due Period and
thereafter the Responsible Party shall be entitled to retain all amounts
received in respect of such Deleted Mortgage Loan.
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(f) The applicable Servicer, based upon information provided by the
Responsible Party, shall amend the Mortgage Loan Schedule for the benefit of
the Certificateholders to reflect the removal of such Deleted Mortgage Loan
and the substitution of the Substitute Mortgage Loan or Loans and such
Servicer shall deliver the amended Mortgage Loan Schedule to the Trustee. Upon
such substitution, the Substitute Mortgage Loan or Loans shall be subject to
the terms of this Agreement in all respects, and the Responsible Party shall
be deemed to have made with respect to such Substitute Mortgage Loan or Loans,
as of the date of substitution, the representations and warranties made
pursuant to Section 2.03(b) with respect to such Mortgage Loan. Upon any such
substitution and the deposit into the related Collection Account of the amount
required to be deposited therein in connection with such substitution as
described in the following paragraph, the Trustee shall release the Mortgage
File held for the benefit of the Certificateholders relating to such Deleted
Mortgage Loan to the Responsible Party and shall execute and deliver at the
Responsible Party's direction such instruments of transfer or assignment
prepared by the Responsible Party, in each case without recourse, as shall be
necessary to vest title in the Responsible Party, of the Trustee's interest in
any Deleted Mortgage Loan substituted for pursuant to this Section 2.03.
(g) For any month in which the Responsible Party substitutes one or
more Substitute Mortgage Loans for one or more Deleted Mortgage Loans, the
applicable Servicer will determine the amount (if any) by which the aggregate
unpaid principal balance of all such Substitute Mortgage Loans as of the date
of substitution is less than the aggregate unpaid principal balance of all
such Deleted Mortgage Loans. The amount of such shortage plus an amount equal
to the sum of (i) any accrued and unpaid interest on the Deleted Mortgage
Loans and (ii) all unreimbursed Servicing Advances with respect to such
Deleted Mortgage Loans (collectively, the "Substitution Adjustment Amount")
shall be remitted by the Responsible Party to the applicable Servicer for
deposit into the related Collection Account on or before the Distribution
Account Deposit Date for the Distribution Date following the Prepayment Period
during which the related Mortgage Loan became required to be purchased or
replaced hereunder.
(h) In addition to such repurchase or substitution obligation, the
Responsible Party shall indemnify the Depositor and its Affiliates, the
Servicers, the Sponsor, the Trustee and the Trust and hold such parties
harmless against any losses, damages, penalties, fines, forfeitures,
reasonable and necessary legal fees and related costs, judgments and other
costs and expenses resulting from any claim, demand, defense or assertion
based on or grounded upon, or resulting from, a breach by the Responsible
Party of any of its representations and warranties or obligations contained in
this Agreement.
(i) In the event that the Responsible Party shall have repurchased a
Mortgage Loan pursuant to this Agreement, the Repurchase Price therefor shall
be deposited by the applicable Servicer in the applicable Collection Account
of the related Servicer pursuant to Section 3.10 on or before the Distribution
Account Deposit Date for the Distribution Date following the Prepayment Period
during which the Responsible Party, as applicable, repurchased such Mortgage
Loan and upon such deposit of the Repurchase Price and receipt of a Request
for Release in the form of Exhibit J hereto, the Trustee shall release the
related Custodial File held for the benefit of the Certificateholders to such
Person as directed by the applicable Servicer, and the Trustee shall execute
and deliver at such Person's direction such instruments of transfer or
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assignment prepared by such Person, in each case without recourse, as shall be
necessary to transfer title from the Trustee.
It is understood and agreed by the parties hereto that the obligation
of the Responsible Party under this Agreement to cure, repurchase or
substitute any Mortgage Loan as to which a breach of a representation and
warranty has occurred and is continuing, together with any related
indemnification obligations of the Responsible Party set forth in Section
2.03(h), shall constitute the sole remedies against such Person respecting
such breach available to Certificateholders, the Depositor (if applicable),
the Servicer or the Trustee.
The provisions of this Section 2.03 shall survive delivery of the
respective Custodial Files to the Trustee for the benefit of the
Certificateholders.
Section 2.04 Execution and Delivery of Certificates. The Trustee
acknowledges the transfer and assignment to it of the Trust Fund and,
concurrently with such transfer and assignment, has executed and delivered to
or upon the order of the Depositor, the Certificates in authorized
Denominations evidencing directly or indirectly the entire ownership of the
Trust Fund. The Trustee agrees to hold the Trust Fund and exercise the rights
referred to above for the benefit of all present and future Holders of the
Certificates.
Section 2.05 REMIC Matters. The Preliminary Statement sets forth the
designations for federal income tax purposes of all interests created hereby.
The "Startup Day" for purposes of the REMIC Provisions shall be the Closing
Date. The "latest possible maturity date" is the Distribution Date occurring
in [_______] 2035, which is the Distribution Date in the month following the
month in which the latest maturity date of any Mortgage Loan occurs. Amounts
distributable to the Class X Certificates (prior to any reduction for any
Basis Risk Payment or Swap Termination Payment), exclusive of any amounts
received from the Swap Provider, shall be deemed paid from the Upper-Tier
REMIC in respect of the Class X Interest to the Holders of the Class X
Certificates prior to distribution of any Basis Risk Payments to the Offered
Certificates. For federal income tax purposes, any amount distributed on the
Offered Certificates on any Distribution Date in excess of the amount
distributable on their Corresponding Class of Upper-Tier Regular Interest on
such Distribution Date shall be treated as having been paid from the Excess
Reserve Fund Account or the Swap Account, as applicable, and any amount
distributable on such Corresponding Class of Upper-Tier Regular Interest on
such Distribution Date in excess of the amount distributable on the
Corresponding Class of Offered Certificates on such Distribution Date shall be
treated as having been paid to the Excess Reserve Fund Account or the Swap
Account, all pursuant to and as further provided in Section 8.13.
Section 2.06 Representations and Warranties of the Depositor. The
Depositor hereby represents, warrants and covenants to the Trustee and the
Servicers that as of the date of this Agreement or as of such date
specifically provided herein:
(a) The Depositor is a corporation duly organized, validly existing
and in good standing under the laws of the State of Delaware;
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(b) The Depositor has the corporate power and authority to convey the
Mortgage Loans and to execute, deliver and perform, and to enter into and
consummate the transactions contemplated by, this Agreement;
(c) This Agreement has been duly and validly authorized, executed and
delivered by the Depositor, all requisite corporate action having been taken,
and, assuming the due authorization, execution and delivery hereof by the
other parties hereto, constitutes or will constitute the legal, valid and
binding agreement of the Depositor, enforceable against the Depositor in
accordance with its terms, except as such enforcement may be limited by
bankruptcy, insolvency, reorganization, moratorium or other similar laws
relating to or affecting the rights of creditors generally, and by general
equity principles (regardless of whether such enforcement is considered in a
proceeding in equity or at law);
(d) No consent, approval, authorization or order of or registration or
filing with, or notice to, any governmental authority or court is required for
the execution, delivery and performance of or compliance by the Depositor with
this Agreement or the consummation by the Depositor of any of the transactions
contemplated hereby, except as have been made on or prior to the Closing Date;
(e) None of the execution and delivery of this Agreement, the
consummation of the transactions contemplated hereby or thereby, or the
fulfillment of or compliance with the terms and conditions of this Agreement,
(i) conflicts or will conflict with or results or will result in a breach of,
or constitutes or will constitute a default or results or will result in an
acceleration under (A) the charter or bylaws of the Depositor, or (B) of any
term, condition or provision of any material indenture, deed of trust,
contract or other agreement or instrument to which the Depositor or any of its
subsidiaries is a party or by which it or any of its subsidiaries is bound;
(ii) results or will result in a violation of any law, rule, regulation,
order, judgment or decree applicable to the Depositor of any court or
governmental authority having jurisdiction over the Depositor or its
subsidiaries; or (iii) results in the creation or imposition of any lien,
charge or encumbrance which would have a material adverse effect upon the
Mortgage Loans or any documents or instruments evidencing or securing the
Mortgage Loans;
(f) There are no actions, suits or proceedings before or against or
investigations of, the Depositor pending, or to the knowledge of the
Depositor, threatened, before any court, administrative agency or other
tribunal, and no notice of any such action, which, in the Depositor's
reasonable judgment, might materially and adversely affect the performance by
the Depositor of its obligations under this Agreement, or the validity or
enforceability of this Agreement;
(g) 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 that may materially and adversely affect its
performance hereunder; and
(h) Immediately prior to the transfer and assignment by the Depositor
to the Trustee on the Closing Date, the Depositor had good title to, and was
the sole owner of each Mortgage Loan, free of any interest of any other
Person, and the Depositor has transferred all right, title and interest in
each Mortgage Loan to the Trustee. The transfer of the Mortgage Note
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and the Mortgage as and in the manner contemplated by this Agreement is
sufficient either (i) fully to transfer to the Trustee, for the benefit of the
Certificateholders, all right, title, and interest of the Depositor thereto as
note holder and mortgagee or (ii) to grant to the Trustee, for the benefit of
the Certificateholders, the security interest referred to in Section 10.04.
It is understood and agreed that the representations, warranties and
covenants set forth in this Section 2.06 shall survive delivery of the
respective Custodial Files to the Trustee and shall inure to the benefit of
the Trustee.
ARTICLE III
ADMINISTRATION AND SERVICING
OF MORTGAGE LOANS
Section 3.01 Servicers to Service Mortgage Loans. (a) For and on
behalf of the Certificateholders, each Servicer shall service and administer
the Mortgage Loans for which it is acting as Servicer in accordance with the
terms of this Agreement and the respective Mortgage Loans and, to the extent
consistent with such terms, in the same manner in which it services and
administers similar mortgage loans for its own portfolio, giving due
consideration to customary and usual standards of practice of mortgage lenders
and loan servicers administering similar mortgage loans but without regard to:
(i) any relationship that such Servicer, any Subservicer or any
Affiliate of such Servicer or any Subservicer may have with the related
Mortgagor;
(ii) the ownership or non ownership of any Certificate by such
Servicer or any Affiliate of such Servicer;
(iii) such Servicer's obligation to make P&I Advances or Servicing
Advances; or
(iv) such Servicer's or any Subservicer's right to receive
compensation for its services hereunder or with respect to any particular
transaction.
To the extent consistent with the foregoing, each Servicer shall seek
to maximize the timely and complete recovery of principal and interest on the
Mortgage Notes. Subject only to the above described servicing standards and
the terms of this Agreement and of the respective Mortgage Loans, each
Servicer shall have full power and authority, acting alone or through
Subservicers as provided in Section 3.02, to do or cause to be done any and
all things in connection with such servicing and administration which it may
deem necessary or desirable. Without limiting the generality of the foregoing,
each Servicer in its own name or in the name of a Subservicer is hereby
authorized and empowered by the Trustee when the applicable Servicer believes
it appropriate in its best judgment in accordance with Accepted Servicing
Practices, to execute and deliver 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 Mortgage Loans and the Mortgaged
Properties and to institute foreclosure proceedings or obtain a deed in lieu
of foreclosure so as to convert the ownership of such properties, and to hold
or cause to be held title
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to such properties, on behalf of the Trustee. Each Servicer shall service and
administer the Mortgage Loans in accordance with applicable state and federal
law and shall provide to the Mortgagors any reports required to be provided to
them thereby. Each Servicer covenants that its computer and other systems used
in servicing the Mortgage Loans operate in a manner such that the Servicer can
service the Mortgage Loans in accordance with the terms of this Pooling and
Servicing Agreement. Each Servicer shall also comply in the performance of
this Agreement with all reasonable rules and requirements of each insurer
under any standard hazard insurance policy. Subject to Section 3.16, the
Trustee shall execute, at the written request of a Servicer, and furnish to
such Servicer and any Subservicer such documents provided to the Trustee as
are necessary or appropriate to enable such Servicer or any Subservicer to
carry out its servicing and administrative duties hereunder, and the Trustee
hereby grants to each Servicer, and this Agreement shall constitute, a power
of attorney to carry out such duties, including a power of attorney in the
form of Exhibit O hereto to take title to Mortgaged Properties after
foreclosure in the name of and on behalf of the Trustee. The Trustee shall
execute a separate power of attorney in favor of each Servicer for the
purposes described herein to the extent necessary or desirable to enable each
Servicer to perform its duties hereunder. The Trustee shall not be liable for
the actions of any Servicer or any Subservicers under such powers of attorney.
Notwithstanding anything contained herein to the contrary, no Servicer or
Subservicer shall without the Trustee's consent: (i) initiate any action, suit
or proceeding solely under the Trustee's name without indicating such
Servicer's or Subservicer's, as applicable, representative capacity, or (ii)
take any action with the intent to, or which actually does cause, the Trustee
to be registered to do business in any state.
(b) Subject to Section 3.09(b), in accordance with the standards of
the preceding paragraph, each Servicer shall advance or cause to be advanced
funds as necessary for the purpose of effecting the timely payment of taxes
and assessments on the Mortgaged Properties, which advances shall be Servicing
Advances reimbursable in the first instance from related collections from the
Mortgagors pursuant to Section 3.09(b), and further as provided in Section
3.11. Any cost incurred by a Servicer or by Subservicers in effecting the
timely payment of taxes and assessments on a Mortgaged Property shall not be
added to the unpaid principal balance of the related Mortgage Loan,
notwithstanding that the terms of such Mortgage Loan so permit.
(c) Notwithstanding anything in this Agreement to the contrary, a
Servicer may not make any future advances with respect to a Mortgage Loan
(except as provided in Section 4.01) and neither Servicer shall (i) permit any
modification with respect to any Mortgage Loan that would change the Mortgage
Rate, reduce or increase the principal balance (except for reductions
resulting from actual payments of principal) or change the final maturity date
on such Mortgage Loan (except for a reduction of interest payments resulting
from the application of the Servicemembers Civil Relief Act or any similar
state statutes) or (ii) permit any modification, waiver or amendment of any
term of any Mortgage Loan that would both (A) effect an exchange or reissuance
of such Mortgage Loan under Section 1001 of the Code (or final, temporary or
proposed Treasury regulations promulgated thereunder) and (B) cause any Trust
REMIC to fail to qualify as a REMIC under the Code or the imposition of any
tax on "prohibited transactions" or "contributions after the startup date"
under the REMIC Provisions, or (iii) except as provided in Section 3.07(a),
waive any Prepayment Charges.
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(d) Each Servicer may delegate its responsibilities under this
Agreement; provided, however, that no such delegation shall release that
Servicer from the responsibilities or liabilities arising under this
Agreement.
(e) In the event that the Mortgage Loan Documents relating to any
Mortgage Loan contain provisions requiring the related Mortgagor to submit to
binding arbitration with respect to any disputes arising in connection with
such Mortgage Loan, the applicable Servicer shall be entitled to waive any
such provisions on behalf of the Trust and to send written notice of such
waiver to the related Mortgagor, although the Mortgagor may still require
arbitration of such disputes at its option.
Section 3.02 Subservicing Agreements between a Servicer and
Subservicers. (a) Each Servicer may enter into subservicing agreements with
Subservicers for the servicing and administration of the Mortgage Loans
("Subservicing Agreements"). Each Servicer represents and warrants to the
other parties hereto that, except as otherwise set forth herein, no
Subservicing Agreement is in effect as of the Closing Date with respect to any
Mortgage Loans required to be serviced by it hereunder. The applicable
Servicer shall give notice to the Depositor and the Trustee of any such
Subservicer and Subservicing Agreement, which notice shall contain all
information (including without limitation a copy of the Subservicing
Agreement) reasonably necessary to enable the Trustee, pursuant to Section
8.12(g), to accurately and timely report the event under Item 6.02 of Form 8-K
pursuant to the Exchange Act (if such reports under the Exchange Act are
required to be filed under the Exchange Act). No Subservicing Agreement shall
be effective until 30 days after such written notice is received by both the
Depositor and the Trustee. The Trustee shall not be required to review or
consent to such Subservicing Agreements and shall have no liability in
connection therewith.
(b) Each Subservicer shall be (i) authorized to transact business in
the state or states in which the related Mortgaged Properties it is to service
are situated, if and to the extent required by applicable law to enable the
Subservicer to perform its obligations hereunder and under the Subservicing
Agreement, (ii) an institution approved as a mortgage loan originator by the
Federal Housing Administration or an institution that has deposit accounts
insured by the FDIC and (iii) a ▇▇▇▇▇▇▇ Mac or ▇▇▇▇▇▇ Mae approved mortgage
servicer. Each Subservicing Agreement must impose on the Subservicer
requirements conforming to the provisions set forth in Section 3.08 and
provide for servicing of the Mortgage Loans consistent with the terms of this
Agreement. Each Servicer will examine each Subservicing Agreement to which it
is a party and will be familiar with the terms thereof. The terms of any
Subservicing Agreement will not be inconsistent with any of the provisions of
this Agreement. Each Servicer and the respective Subservicers may enter into
and make amendments to the Subservicing Agreements or enter into different
forms of Subservicing Agreements; provided, however, that any such amendments
or different forms shall be consistent with and not violate the provisions of
this Agreement, and that no such amendment or different form shall be made or
entered into which could be reasonably expected to be materially adverse to
the interests of the Trustee, without the consent of the Trustee. Any
variation without the consent of the Trustee from the provisions set forth in
Section 3.08 relating to insurance or priority requirements of Subservicing
Accounts, or credits and charges to the Subservicing Accounts or the timing
and amount of remittances by the Subservicers to such Servicer, are
conclusively deemed to be inconsistent with this Agreement and therefore
prohibited. Each Servicer shall deliver to the Trustee and the Depositor
copies of
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all Subservicing Agreements, and any amendments or modifications thereof,
promptly upon such Servicer's execution and delivery of such instruments.
(c) As part of its servicing activities hereunder, each Servicer
(except as otherwise provided in the last sentence of this paragraph), for the
benefit of the Trustee, shall enforce the obligations of each Subservicer
under the related Subservicing Agreement to which such Servicer is a party,
including, without limitation, any obligation to make advances in respect of
delinquent payments as required by a Subservicing Agreement. Such enforcement,
including, without limitation, the legal prosecution of claims, termination of
Subservicing Agreements, and the pursuit of other appropriate remedies, shall
be in such form and carried out to such an extent and at such time as such
Servicer, in its good faith business judgment, would require were it the owner
of the related Mortgage Loans. Each Servicer shall pay the costs of such
enforcement at its own expense, and shall be reimbursed therefor only (i) from
a general recovery resulting from such enforcement, to the extent, if any,
that such recovery exceeds all amounts due in respect of the related Mortgage
Loans or (ii) from a specific recovery of costs, expenses or attorneys' fees
against the party against whom such enforcement is directed.
(d) Each Servicer shall cause any Subservicer engaged by such Servicer
(or by any Subservicer) for the benefit of the Depositor and the Trustee to
comply with the provisions of this Section 3.02 and with Sections 3.22, 3.23,
6.02 and 6.05 of this Agreement to the same extent as if such Subservicer were
such Servicer, and to provide the information required with respect to such
Subservicer under Section 8.12(f) of this Agreement. Such Servicer shall be
responsible for obtaining from each such Subservicer and delivering to
applicable Persons any servicer compliance statement required to be delivered
by such Subservicer under Section 3.22 and any assessment of compliance report
and related accountant's attestation required to be delivered by such
Subservicer under Section 3.23, in each case as and when required to be
delivered.
(e) Subject to the conditions set forth in this Section 3.02(e), each
Servicer and any Subservicer engaged by such Servicer is permitted to utilize
one or more Subcontractors to perform certain of its obligations hereunder.
Such Servicer shall promptly upon request provide to the Depositor a written
description (in form and substance satisfactory to the Depositor) of the role
and function of each Subcontractor utilized by such Servicer or any such
Subservicer, specifying, not later than the date specified for delivery of the
annual report on assessment of compliance set forth in Section 3.23(d), (i)
the identity of each such Subcontractor, if any, that is "participating in the
servicing function" within the meaning of Item 1122 of Regulation AB, and (ii)
which elements of the Servicing Criteria will be addressed in assessments of
compliance provided by each Subcontractor identified pursuant to clause (i) of
this paragraph. As a condition to the utilization by such Servicer or any such
Subservicer of any Subcontractor determined to be "participating in the
servicing function" within the meaning of Item 1122 of Regulation AB, such
Servicer shall cause any such Subcontractor used by such Servicer (or by any
such Subservicer) for the benefit of the Depositor and the Trustee to comply
with the provisions of Section 3.23 of this Agreement to the same extent as if
such Subcontractor were such Servicer. Such Servicer shall be responsible for
obtaining from each such Subcontractor and delivering to the applicable
Persons any assessment of compliance report and related accountant's
attestation required to be delivered by such Subcontractor under Section 3.23,
in each case as and when required to be delivered.
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Notwithstanding the foregoing, if a Servicer engages a
Subcontractor in connection with the performance of any of its duties under
this Agreement, such Servicer shall be responsible for determining whether
such Subcontractor is a "servicer" within the meaning of Item 1101 of
Regulation AB and whether any such affiliate or third-party vendor meets the
criteria in Item 1108(a)(2)(i) through (iii) of Regulation AB. If a Servicer
determines, pursuant to the preceding sentence, that such Subcontractor is a
"servicer" within the meaning of Item 1101 of Regulation AB and meets the
criteria in Item 1108(a)(2)(i) through (iii) of Regulation AB, then such
Subcontractor shall be deemed to be a Subservicer for purposes of this
Agreement, the engagement of such Subservicer shall not be effective unless
and until notice is given pursuant to Section 3.02(a) and such Servicer shall
comply with Section 3.02(d) with respect thereto.
(f) As of the Closing Date, [_________] has appointed [___________]
("___") to act as the sole Subservicer pursuant to a Subservicing Agreement (a
copy of which is attached hereto as Exhibit V) with respect to [_________]'s
servicing obligations under this Agreement. So long as [_________] is not a
rated servicer by each Rating Agency, [_________] agrees that prior to
replacing [____] as Subservicer, other than with an affiliate of [_________]
that is a rated servicer, it will obtain confirmation from each Rating Agency
that such replacement of [____] as Subservicer with respect to [_________]'s
servicing obligations related to the Mortgage Loans will not cause the then
current rating on any Class of Certificates to be qualified, withdrawn or
lowered by any Rating Agency and agrees that any replacement subservicer shall
agree to subservice in accordance with the terms of this Agreement, including
but not limited to the consideration of whether to waive a Prepayment Charge
hereunder.
Section 3.03 Successor Subservicers. Each Servicer shall be entitled
to terminate any Subservicing Agreement to which such Servicer is a party and
the rights and obligations of any Subservicer pursuant to any such
Subservicing Agreement in accordance with the terms and conditions of such
Subservicing Agreement; provided, however, that the termination, resignation
or removal of a Subservicer shall be not be effective until 30 days after
written notice is received by both the Depositor and the Trustee that contains
all information reasonably necessary to enable the Trustee, pursuant to
Section 8.12(g), to accurately and timely report the event under Item 6.02 of
Form 8-K pursuant to the Exchange Act (if such reports under the Exchange Act
are required to be filed under the Exchange Act). In the event of termination
of any Subservicer, all servicing obligations of such Subservicer shall be
assumed simultaneously by the applicable Servicer party to the related
Subservicing Agreement without any act or deed on the part of such Subservicer
or such Servicer, and such Servicer either shall service directly the related
Mortgage Loans or shall enter into a Subservicing Agreement with a successor
Subservicer which qualifies under Section 3.02.
Any Subservicing Agreement shall include the provision that such
agreement may be immediately terminated by the Depositor or the Trustee
without fee, in accordance with the terms of this Agreement, in the event that
the Servicer party to the related Subservicing Agreement shall, for any
reason, no longer be a Servicer (including termination due to an Event of
Default).
Section 3.04 Liability of the Servicers. Notwithstanding any
Subservicing Agreement, any of the provisions of this Agreement relating to
agreements or arrangements
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between a Servicer and a Subservicer or reference to actions taken through a
Subservicer or otherwise, such Servicer shall remain obligated and primarily
liable to the Trustee for the servicing and administering of the Mortgage
Loans in accordance with the provisions of Section 3.01 without diminution of
such obligation or liability by virtue of such Subservicing Agreements or
arrangements or by virtue of indemnification from the Subservicer and to the
same extent and under the same terms and conditions as if such Servicer alone
were servicing and administering such Mortgage Loans. Each Servicer shall be
entitled to enter into any agreement with a Subservicer for indemnification of
such Servicer by such Subservicer and nothing contained in this Agreement
shall be deemed to limit or modify such indemnification.
Section 3.05 No Contractual Relationship between Subservicers and the
Trustee. Any Subservicing Agreement that may be entered into and any
transactions or services relating to the Mortgage Loans involving a
Subservicer in its capacity as such shall be deemed to be between the
Subservicer and the related Servicer alone, and the Trustee (or any successor
to such servicer) shall not be deemed a party thereto and shall have no
claims, rights, obligations, duties or liabilities with respect to the
Subservicer except as set forth in Section 3.06. Each Servicer shall be solely
liable for all fees owed by it to any Subservicer, irrespective of whether
such Servicer's compensation pursuant to this Agreement is sufficient to pay
such fees.
Section 3.06 Assumption or Termination of Subservicing Agreements by
Trustee. In the event a Servicer at any time shall for any reason no longer be
a Servicer (including by reason of the occurrence of an Event of Default), the
Trustee, or its designee, or the successor servicer if the successor is not
the Trustee, shall thereupon assume all of the rights and obligations of such
Servicer under each Subservicing Agreement that such Servicer may have entered
into, with copies thereof provided to the Trustee, or the successor servicer
if the successor is not the Trustee, prior to the Trustee, or the successor
servicer if the successor is not the Trustee, assuming such rights and
obligations, unless the Trustee elects to terminate any Subservicing Agreement
in accordance with its terms as provided in Section 3.03.
Upon such assumption, the Trustee, its designee or the successor
servicer shall be deemed, subject to Section 3.03, to have assumed all of such
Servicer's interest therein and to have replaced such Servicer as a party to
each Subservicing Agreement to which the predecessor servicer was a party to
the same extent as if each Subservicing Agreement had been assigned to the
assuming party, except that (i) such Servicer shall not thereby be relieved of
any liability or obligations under any such Subservicing Agreement that arose
before it ceased to be a Servicer and (ii) none of the Depositor, the Trustee,
their designees or any successor to such servicer shall be deemed to have
assumed any liability or obligation of such Servicer that arose before it
ceased to be a Servicer.
Such Servicer at its expense shall, upon request of the Trustee, its
designee or the successor servicer deliver to the assuming party all documents
and records relating to each Subservicing Agreement to which it is a party and
the Mortgage Loans then being serviced by it and an accounting of amounts
collected and held by or on behalf of it, and otherwise use its best efforts
to effect the orderly and efficient transfer of the Subservicing Agreements to
the assuming party.
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Section 3.07 Collection of Certain Mortgage Loan Payments. (a) Each
Servicer shall make reasonable efforts to collect all payments called for
under the terms and provisions of the Mortgage Loans, and shall, to the extent
such procedures shall be consistent with this Agreement and the terms and
provisions of any applicable Insurance Policies, follow such collection
procedures as it would follow with respect to mortgage loans comparable to the
Mortgage Loans and held for its own account. Consistent with the foregoing and
Accepted Servicing Practices, each Servicer may (i) waive any late payment
charge or, if applicable, any penalty interest, or (ii) extend the Due Dates
for the Scheduled Payments due on a Mortgage Note for a period of not greater
than 180 days; provided that any extension pursuant to clause (ii) above shall
not affect the amortization schedule of any Mortgage Loan for purposes of any
computation hereunder, except as provided below. In the event of any such
arrangement pursuant to clause (ii) above, the applicable Servicer shall make
timely advances on such Mortgage Loan during such extension pursuant to
Section 4.01 and in accordance with the amortization schedule of such Mortgage
Loan without modification thereof by reason of such arrangements, subject to
Section 4.01(d) pursuant to which such Servicer shall not be required to make
any such advances that are Nonrecoverable P&I Advances. Notwithstanding the
foregoing, a Servicer may waive, or permit a Subservicer to waive, in whole or
in part, a Prepayment Charge only under the following circumstances: (i) such
waiver relates to a default or a reasonably foreseeable default and would, in
the reasonable judgment of such Servicer, maximize recovery of total proceeds
taking into account the value of such Prepayment Charge and the related
Mortgage Loan, (ii) such Prepayment Charge is not permitted to be collected by
applicable federal, state or local law or regulation or (iii) the collection
of such Prepayment Charge would be considered "predatory" pursuant to written
guidance published or issued by any applicable federal, state or local
regulatory authority acting in its official capacity and having jurisdiction
over such matters. If a Prepayment Charge is waived other than as permitted by
the prior sentence, then the applicable Servicer is required to pay the amount
of such waived Prepayment Charge, for the benefit of the Holders of the Class
P Certificates, by depositing such amount into the related Collection Account
together with and at the time that the amount prepaid on the related Mortgage
Loan is required to be deposited into the Collection Account; provided,
however, that the applicable Servicer shall not have an obligation to pay the
amount of any uncollected Prepayment Charge if the failure to collect such
amount is the direct result of inaccurate or incomplete information on the
Mortgage Loan Schedule in effect at such time.
(b) (i) The Trustee shall establish and maintain the Excess Reserve
Fund Account, on behalf of the Class X Certificateholders, to receive any
Basis Risk Payment and to secure their limited recourse obligation to pay to
the Offered Certificateholders Basis Risk Carry Forward Amounts (prior to
using any Net Swap Receipts). For the avoidance of doubt, any Basis Risk Carry
Forward Amounts shall be paid to the Offered Certificates first from the
Excess Reserve Fund Account and then from the Swap Account.
(ii) On each Distribution Date, the Trustee shall deposit the amount
of any Basis Risk Payment for such date into the Excess Reserve Fund Account.
(c) (i) On each Distribution Date on which there exists a Basis Risk
Carry Forward Amount on any Class of Certificates, the Trustee shall (1)
withdraw from the Distribution Account and deposit in the Excess Reserve Fund
Account, as set forth in Section 4.02(a)(iii)(S), the lesser of (x) the Class
X Distributable Amount (without regard to the
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reduction in clause (iii) in the definition thereof) (to the extent remaining
after the distributions specified in Sections 4.02(a)(iii)(A)-(R)) and (y) the
aggregate Basis Risk Carry Forward Amounts for such Distribution Date and (2)
withdraw from the Excess Reserve Fund Account amounts necessary to pay to such
Class or Classes of Certificates the Basis Risk Carry Forward Amount. Such
payments, along with payments from the Swap Account, shall be allocated to
those Classes on a pro rata basis based upon the amount of Basis Risk Carry
Forward Amount owed to each such Class and shall be paid in the priority set
forth in Section 4.02(a)(iii)(T).
(ii) The Trustee shall account for the Excess Reserve Fund Account as
an asset of a grantor trust under subpart E, Part I of the subchapter J
of the Code and not an asset of any Trust REMIC. The beneficial owners of
the Excess Reserve Fund Account are the Class X Certificateholders. For
all federal tax purposes, amounts transferred by the Upper Tier REMIC to
the Excess Reserve Fund Account shall be treated as distributions by the
Trustee to the Class X Certificateholders.
(iii) Any Basis Risk Carry Forward Amounts paid by the Trustee to the
Offered Certificateholders shall be accounted for by the Trustee as
amounts paid first to the Holders of the Class X Certificates and then to
the respective Class or Classes of Offered Certificates. In addition, the
Trustee shall account for the Offered Certificateholders' rights to
receive payments of Basis Risk Carry Forward Amounts (along with payments
of Basis Risk Carry Forward Amounts and Upper-Tier Carry Forward Amounts
from the Swap Account) as rights in a limited recourse interest rate cap
contract written by the Class X Certificateholders in favor of the LIBOR
Certificateholders.
(iv) Notwithstanding any provision contained in this Agreement, the
Trustee shall not be required to make any payments from the Excess
Reserve Fund Account except as expressly set forth in this Section
3.07(c) and Sections 4.02(a)(iii)(T) and (V).
(d) The Trustee shall establish and maintain the Distribution Account
on behalf of the Certificateholders. The Depositor shall cause to be deposited
into the Distribution Account on the Closing Date the Closing Date Deposit
Amount. The Trustee shall, promptly upon receipt, deposit in the Distribution
Account and retain therein the following:
(i) the aggregate amount remitted by the Servicers to the Trustee
pursuant to Section 3.11;
(ii) any amount deposited by the Servicers pursuant to Section 3.12(b)
in connection with any losses on Permitted Investments; and
(iii) any other amounts deposited hereunder which are required to be
deposited in the Distribution Account.
In the event that any Servicer shall remit any amount not required to
be remitted, it may at any time direct the Trustee in writing to withdraw such
amount from the Distribution Account, any provision herein to the contrary
notwithstanding. Such direction may be accomplished by delivering notice to
the Trustee which describes the amounts deposited in error in the Distribution
Account. All funds deposited in the Distribution Account shall be held by the
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Trustee in trust for the Certificateholders until disbursed in accordance with
this Agreement or withdrawn in accordance with Section 4.02.
(e) The Trustee may invest the funds in the Distribution Account, in
one or more Permitted Investments, in accordance with Section 3.12. Each
Servicer shall direct the Trustee to withdraw from the Distribution Account
and to remit to such Servicer no less than monthly, all income and gain
realized from the investment of the portion of funds deposited in the
Distribution Account by such Servicer (except during the Trustee Float
Period). The Trustee may withdraw from the Distribution Account any income or
gain earned from the investment of funds deposited therein during the Trustee
Float Period for its own benefit.
(f) Each Servicer shall give notice to the Trustee, each Rating Agency
and the Depositor of any proposed change of the location of the related
Collection Account within a reasonable period of time prior to any change
thereof.
(g) To help fight the funding of terrorism and money laundering
activities, the Trustee will obtain, verify, and record information that
identifies individuals or entities that establish a relationship or open an
account with the Trustee. The Trustee will ask for the name, address, tax
identification number and other information that will allow the Trustee to
identify the individual or entity who is establishing the relationship or
opening the account. The Trustee may also ask for formation documents such as
articles of incorporation, an offering memorandum, or other identifying
documents to be provided.
Section 3.08 Subservicing Accounts. In those cases where a Subservicer
is servicing a Mortgage Loan pursuant to a Subservicing Agreement, the
Subservicer will be required to establish and maintain one or more segregated
accounts (collectively, the "Subservicing Account"). The Subservicing Account
shall be an Eligible Account and shall otherwise be acceptable to the related
Servicer. The Subservicer shall deposit in the clearing account (which account
must be an Eligible Account) in which it customarily deposits payments and
collections on mortgage loans in connection with its mortgage loan servicing
activities on a daily basis, and in no event more than one Business Day after
the Subservicer's receipt thereof, all proceeds of Mortgage Loans received by
the Subservicer less its servicing compensation to the extent permitted by the
Subservicing Agreement, and shall thereafter deposit such amounts in the
Subservicing Account, in no event more than two Business Days after the
deposit of such funds into the clearing account. The Subservicer shall
thereafter deposit such proceeds in the Collection Account of the related
Servicer or remit such proceeds to the related Servicer for deposit in the
Collection Account of the related Servicer not later than two Business Days
after the deposit of such amounts in the Subservicing Account. For purposes of
this Agreement, such Servicer shall be deemed to have received payments on the
Mortgage Loans when the Subservicer receives such payments.
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Section 3.09 Collection of Taxes, Assessments and Similar Items;
Escrow Accounts. (a) Each Servicer shall enforce the obligations under each
paid-in-full, life-of-the-loan tax service contract in effect with respect to
each First Lien Mortgage Loan (each, a "Tax Service Contract") serviced by
such Servicer. Each Tax Service Contract shall be assigned to the Trustee, or
a successor servicer at the applicable Servicer's expense in the event that a
Servicer is terminated as Servicer of the related Mortgage Loan.
(b) To the extent that the services described in this paragraph (b)
are not otherwise provided pursuant to the Tax Service Contracts described in
paragraph (a) above, each Servicer undertakes to perform such functions with
respect to the Mortgage Loans serviced by such Servicer. To the extent the
related Mortgage provides for Escrow Payments, the related Servicer shall
establish and maintain, or cause to be established and maintained, one or more
segregated accounts (the "Escrow Accounts"), which shall be Eligible Accounts.
Each Servicer shall deposit in the clearing account (which account must be an
Eligible Account) in which it customarily deposits payments and collections on
mortgage loans in connection with its mortgage loan servicing activities on a
daily basis, and in no event more than one Business Day after the Servicer's
receipt thereof, all collections from the Mortgagors (or related advances from
Subservicers) for the payment of taxes, assessments, hazard insurance premiums
and comparable items for the account of the Mortgagors ("Escrow Payments")
collected on account of the Mortgage Loans and shall thereafter deposit such
Escrow Payments in the Escrow Accounts, in no event more than two Business
Days after the deposit of such funds in the clearing account, for the purpose
of effecting the payment of any such items as required under the terms of this
Agreement. Withdrawals of amounts from an Escrow Account may be made only to
(i) effect payment of taxes, assessments, hazard insurance premiums, and
comparable items; (ii) reimburse such Servicer (or a Subservicer to the extent
provided in the related Subservicing Agreement) out of related collections for
any advances made pursuant to Section 3.01 (with respect to taxes and
assessments) and Section 3.13 (with respect to hazard insurance); (iii) refund
to Mortgagors any sums as may be determined to be overages; (iv) pay interest,
if required and as described below, to Mortgagors on balances in the Escrow
Account; (v) clear and terminate the Escrow Account at the termination of such
Servicer's obligations and responsibilities in respect of the Mortgage Loans
under this Agreement; (vi) to transfer such funds to a replacement Escrow
Account that meets the requirements hereof; or (vii) recover amounts deposited
in error. As part of its servicing duties, each Servicer or Subservicers shall
pay to the Mortgagors interest on funds in Escrow Accounts, to the extent
required by law and, to the extent that interest earned on funds in the Escrow
Accounts is insufficient, to pay such interest from its or their own funds,
without any reimbursement therefor. To the extent that a Mortgage does not
provide for Escrow Payments, the applicable Servicer shall determine whether
any such payments are made by the Mortgagor in a manner and at a time that
avoids the loss of the Mortgaged Property due to a tax sale or the foreclosure
of a tax lien. The applicable Servicer assumes full responsibility for the
payment of all such bills within such time and shall effect payments of all
such bills irrespective of the Mortgagor's faithful performance in the payment
of same or the making of the Escrow Payments and shall make advances from its
own funds to effect such payments; provided, however, that such advances are
deemed to be Servicing Advances.
Section 3.10 Collection Accounts. (a) On behalf of the Trustee,
each Servicer shall establish and maintain, or cause to be established and
maintained, one or more separate Eligible Accounts (such account or accounts,
the "Collection Account"), held in trust for the
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benefit of the Trustee. On behalf of the Trustee, each Servicer shall deposit
or cause to be deposited in the clearing account (which account must be an
Eligible Account) in which it customarily deposits payments and collections on
mortgage loans in connection with its mortgage loan servicing activities on a
daily basis, and in no event more than one Business Day after such Servicer's
receipt thereof, and shall thereafter deposit in the related Collection
Account, in no event more than two Business Days after the deposit of such
funds into the clearing account, as and when received or as otherwise required
hereunder, the following payments and collections received or made by it
subsequent to the Cut-off Date (other than in respect of principal or interest
on the related Mortgage Loans due on or before the Cut-off Date), or payments
(other than Principal Prepayments) received by it on or prior to the related
Cut-off Date but allocable to a Due Period subsequent thereto:
(i) all payments on account of principal, including Principal
Prepayments, on the Mortgage Loans;
(ii) all payments on account of interest (net of the related Servicing
Fee) on each Mortgage Loan;
(iii) all Insurance Proceeds and Condemnation Proceeds to the extent
such Insurance Proceeds and Condemnation Proceeds are not to be applied
to the restoration of the related Mortgaged Property or released to the
related Mortgagor in accordance with the express requirements of law or
in accordance with Accepted Servicing Practices and Liquidation Proceeds;
(iv) any amounts required to be deposited pursuant to Section 3.12 in
connection with any losses realized on Permitted Investments with respect
to funds held in the related Collection Account;
(v) any amounts required to be deposited by such Servicer pursuant to
the second paragraph of Section 3.13(a) in respect of any blanket policy
deductibles;
(vi) all proceeds of any Mortgage Loan repurchased or purchased in
accordance with this Agreement; and
(vii) all Prepayment Charges collected or paid (pursuant to Section
3.07(a)) by such Servicer.
The foregoing requirements for deposit in the Collection Accounts
shall be exclusive, it being understood and agreed that, without limiting the
generality of the foregoing, payments in the nature of late payment charges,
NSF fees, reconveyance fees, assumption fees and other similar fees and
charges need not be deposited by each Servicer in the related Collection
Account and shall, upon collection, belong to the applicable Servicer as
additional compensation for its servicing activities. In the event a Servicer
shall deposit in the related Collection Account any amount not required to be
deposited therein, it may at any time withdraw such amount from its Collection
Account, any provision herein to the contrary notwithstanding.
(b) Funds in the Collection Accounts may be invested in Permitted
Investments in accordance with the provisions set forth in Section 3.12. Each
Servicer shall give
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notice to the Trustee of the location of the related Collection Account
maintained by it when established and prior to any change thereof in
accordance with Section 3.07(f).
Section 3.11 Withdrawals from the Collection Accounts. (a) Each
Servicer shall, from time to time, make withdrawals from the related
Collection Account for any of the following purposes or as described in
Section 4.01:
(i) on or prior to each Remittance Date, to remit to the Trustee (A)
the Trustee Fee with respect to such Distribution Date and (B) all
Available Funds (without reduction for amounts owed to the Depositor or
the Trustee as provided for in the definition of "Available Funds") in
respect of the related Distribution Date together with all amounts
representing Prepayment Charges from the Mortgage Loans received by the
applicable Servicer during the related Prepayment Period;
(ii) to reimburse such Servicer for P&I Advances, but only to the
extent of amounts received which represent Late Collections (net of the
related Servicing Fees) of Scheduled Payments on Mortgage Loans with
respect to which such P&I Advances were made in accordance with the
provisions of Section 4.01 (such Servicer's right for recovery or
reimbursement has priority over the Trust as stated in the definition of
"Available Funds");
(iii) to pay such Servicer or any Subservicer (a) any unpaid Servicing
Fees or (b) any unreimbursed Servicing Advances with respect to each
Mortgage Loan serviced by such Servicer or Subservicer, but only to the
extent of any Late Collections, Liquidation Proceeds, Condemnation
Proceeds, Insurance Proceeds or other amounts as may be collected by such
Servicer from a Mortgagor, or otherwise received with respect to such
Mortgage Loan (or the related REO Property) (such Servicer's right for
recovery or reimbursement has priority over the Trust as stated in the
definition of "Available Funds");
(iv) to pay to such Servicer as servicing compensation (in addition to
the Servicing Fee) on the Remittance Date any interest or investment
income earned on funds deposited in its Collection Account;
(v) to pay to the Responsible Party, with respect to each Mortgage
Loan that has previously been repurchased or replaced pursuant to this
Agreement, all amounts received thereon subsequent to the date of
purchase or substitution, as further described herein;
(vi) to reimburse such Servicer for (A) any P&I Advance or Servicing
Advance previously made which such Servicer has determined to be a
Nonrecoverable P&I Advance or Nonrecoverable Servicing Advance in
accordance with the provisions of Section 4.01 and (B) any unpaid
Servicing Fees related to any Second Lien Mortgage Loan to the extent not
recoverable from Liquidation Proceeds, Insurance Proceeds or other
amounts received with respect to the related Second Lien Mortgage Loan
under Section 3.11(a)(iii) (such Servicer's right for recovery or
reimbursement has priority over the Trust as stated in the definition of
"Available Funds");
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(vii) to pay, or to reimburse such Servicer for advances in respect
of, expenses incurred in connection with any Mortgage Loan serviced by
such Servicer pursuant to Section 3.15 (such Servicer's right for
recovery or reimbursement has priority over the Trust);
(viii) to reimburse such Servicer or the Depositor for expenses
incurred by or reimbursable to such Servicer or the Depositor, as the
case may be, pursuant to Section 6.03 (such Servicer's right for recovery
or reimbursement has priority over the Trust as stated in the definition
of "Available Funds");
(ix) to reimburse such Servicer or the Trustee, as the case may be,
for expenses reasonably incurred in respect of the breach or defect
giving rise to the repurchase obligation of the Responsible Party under
this Agreement that were included in the Repurchase Price of the Mortgage
Loan, including any expenses arising out of the enforcement of the
repurchase obligation, to the extent not otherwise paid pursuant to the
terms hereof (such Servicer's right for recovery or reimbursement has
priority over the Trust as stated in the definition of "Available
Funds");
(x) to withdraw any amounts deposited in the related Collection
Account in error;
(xi) to withdraw any amounts held in the related Collection Account
and not required to be remitted to the Trustee on the Remittance Date
occurring in the month in which such amounts are deposited into such
Collection Account, to reimburse such Servicer for ▇▇▇▇▇▇▇▇▇▇▇▇ ▇&▇
Advances;
(xii) to invest funds in Permitted Investments in accordance with
Section 3.12; and
(xiii) to clear and terminate the related Collection Account upon
termination of this Agreement.
(b) Each Servicer shall keep and maintain separate accounting, on a
Mortgage Loan by Mortgage Loan basis, for the purpose of justifying any
withdrawal from the related Collection Account, to the extent held by or on
behalf of it, pursuant to subclauses (a)(ii), (iii), (v), (vi), (vii), (viii)
and (ix) above. Each Servicer shall provide written notification (as set forth
in Section 4.01(d)) to the Trustee, on or prior to the next succeeding
Remittance Date, upon making any withdrawals from the related Collection
Account pursuant to subclause (a)(vi) above.
(c) Each Servicer shall be responsible for reviewing and reconciling
the applicable Collection Account in accordance with Accepted Servicing
Practices. Each Servicer shall act promptly to resolve any discrepancies.
Section 3.12 Investment of Funds in the Collection Accounts and the
Distribution Account. (a) Each Servicer may invest the funds in the related
Collection Account and the related Escrow Account (to the extent permitted by
law and the related Mortgage Loan documents) and the Trustee may (but is not
obligated to) invest funds in the Distribution
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Account during the Trustee Float Period, and, with respect to the portion of
funds in the Distribution Account deposited by a Servicer, shall (except
during the Trustee Float Period) invest such funds in the Distribution Account
at the direction of such Servicer (for purposes of this Section 3.12, such
Accounts are referred to as an "Investment Account"), in one or more Permitted
Investments bearing interest or sold at a discount, and maturing, unless
payable on demand, 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; provided, however, that the Trustee shall have no
obligation to invest funds deposited into the Distribution Account by a
Servicer on the Remittance Date later than 10:00 a.m. (Pacific Standard Time).
If no investment instruction is given in a timely manner, the Trustee shall
hold the funds in the Distribution Account uninvested. All such Permitted
Investments shall be held to maturity, unless payable on demand. Any
investment of funds in an Investment Account (other than investments made
during the Trustee Float Period) shall be made in the name of the Trustee in
Permitted Investments selected by the applicable Servicer. The applicable
Servicer shall be entitled to sole possession (except with respect to
investment direction of funds and any income and gain realized on any
investment in the Distribution Account during the Trustee Float Period, which
shall be for the sole benefit of the Trustee) over each such related
investment, and any certificate or other instrument evidencing any such
investment shall be delivered directly to the applicable Servicer, or with
respect to investments during the Trustee Float Period, the Trustee or its
agent (with a copy to the Trustee or its agent if related to investment of
funds in the Distribution Account not during the Trustee Float Period),
together with any document of transfer necessary to transfer title to such
investment to the applicable Servicer, or with respect to investments during
the Trustee Float Period, the Trustee or its agent. In the event amounts on
deposit in an Investment Account are at any time invested in a Permitted
Investment payable on demand, the applicable Servicer, or with respect to
investments during the Trustee Float Period, the Trustee may:
(x) consistent with any notice required to be given thereunder,
demand that payment thereon be made on the last day such
Permitted Investment may otherwise mature hereunder in an
amount equal to the lesser of (1) all amounts then payable
thereunder and (2) the amount required to be withdrawn on
such date; and
(y) demand payment of all amounts due thereunder that such
Permitted Investment would not constitute a Permitted
Investment in respect of funds thereafter on deposit in an
Investment Account.
(b) All income and gain realized from the investment of funds
deposited in the related Collection Account or Escrow Account held by or on
behalf of the related Servicer, shall be for the benefit of such Servicer and
shall be subject to its withdrawal in the manner set forth in Section 3.11.
Such Servicer shall deposit in its Collection Account or Escrow Account, as
applicable, the amount of any loss of principal incurred in respect of any
such Permitted Investment made with funds in such accounts immediately upon
realization of such loss.
(c) All income and gain realized from the investment of the portion of
funds deposited in the Distribution Account by a Servicer and held by the
Trustee, shall be for the benefit of such Servicer (except for any income or
gain realized from the investment of funds on
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deposit in the Distribution Account during the Trustee Float Period, which
shall be for the benefit of the Trustee) and shall be subject to the Trustee's
withdrawal in the manner set forth in Section 3.07(e). Each Servicer shall
deposit in the Distribution Account (except with respect to losses incurred
during the Trustee Float Period) the amount of any loss of principal incurred
in respect of any such Permitted Investment made with funds in such accounts
immediately upon realization of such loss.
(d) Except as otherwise expressly provided in this Agreement, if any
default occurs in the making of a payment due under any Permitted Investment,
or if a default occurs in any other performance required under any Permitted
Investment, the Trustee shall take such action as may be appropriate to
enforce such payment or performance, including the institution and prosecution
of appropriate proceedings.
(e) The Trustee shall not be liable for the amount of any loss
incurred with respect of any investment or lack of investment of funds held in
any Investment Account or the Distribution Account (except that if any losses
are incurred from the investment of funds deposited in the Distribution
Account during the Trustee Float Period, the Trustee shall be responsible for
reimbursing the Trust for such loss immediately upon realization of such loss)
if made in accordance with this Section 3.12.
(f) The Trustee or its Affiliates shall be permitted to receive
additional compensation that could be deemed to be in the Trustee's economic
self-interest for (i) serving as investment adviser, administrator,
shareholder, servicing agent, custodian or sub-custodian with respect to
certain of the Permitted Investments, (ii) using Affiliates to effect
transactions in certain Permitted Investments and (iii) effecting transactions
in certain Permitted Investments. Such compensation shall not be considered an
amount that is reimbursable or payable pursuant to this Agreement.
Section 3.13 Maintenance of Hazard Insurance and Errors and Omissions
and Fidelity Coverage. (a) Each Servicer shall cause to be maintained for each
Mortgage Loan serviced by such Servicer fire insurance with extended coverage
on the related Mortgaged Property in an amount which is at least equal to the
least of (i) the outstanding principal balance of such Mortgage Loan, (ii) the
amount necessary to fully compensate for any damage or loss to the
improvements that are a part of such property on a replacement cost basis and
(iii) the maximum insurable value of the improvements which are a part of such
Mortgaged Property, in each case in an amount not less than such amount as is
necessary to avoid the application of any coinsurance clause contained in the
related hazard insurance policy. Each Servicer shall also cause to be
maintained fire insurance with extended coverage on each REO Property serviced
by such Servicer in an amount which is at least equal to the lesser of (i) the
maximum insurable value of the improvements which are a part of such property
and (ii) the outstanding principal balance of the related Mortgage Loan at the
time it became an REO Property. Each Servicer will comply in the performance
of this Agreement with all reasonable rules and requirements of each insurer
under any such hazard policies. Any amounts to be collected by any Servicer
under any such policies (other than amounts to be applied to the restoration
or repair of the property subject to the related Mortgage or amounts to be
released to the Mortgagor in accordance with the procedures that such Servicer
would follow in servicing loans held for its own account, subject to the terms
and conditions of the related Mortgage and Mortgage Note) shall be deposited
in the
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related Collection Account, subject to withdrawal pursuant to Section 3.11.
Any cost incurred by any Servicer in maintaining any such insurance shall not,
for the purpose of calculating distributions to the Trustee, be added to the
unpaid principal balance of the related Mortgage Loan, notwithstanding that
the terms of such Mortgage Loan so permit. It is understood and agreed that no
earthquake or other additional insurance is to be required of any Mortgagor
other than pursuant to such applicable laws and regulations as shall at any
time be in force and as shall require such additional insurance. If the
Mortgaged Property or REO Property is at any time in an area identified in the
Federal Register by the Federal Emergency Management Agency as having special
flood hazards and flood insurance has been made available, the applicable
Servicer will cause to be maintained a flood insurance policy in respect
thereof. Such flood insurance shall be in an amount equal to the lesser of (i)
the unpaid principal balance of the related Mortgage Loan and (ii) the maximum
amount of such insurance available for the related Mortgaged Property under
the national flood insurance program (assuming that the area in which such
Mortgaged Property is located is participating in such program).
In the event that any Servicer shall obtain and maintain a blanket
policy with an insurer either (i) acceptable to ▇▇▇▇▇▇ ▇▇▇ or ▇▇▇▇▇▇▇ Mac or
(ii) having a General Policy Rating of A:X or better from Best's (or such
other rating that is comparable to such rating) insuring against hazard losses
on all of the Mortgage Loans, it shall conclusively be deemed to have
satisfied its obligations as set forth in the first two sentences of this
Section 3.13, it being understood and agreed that such policy may contain a
deductible clause, in which case such Servicer shall, in the event that there
shall not have been maintained on the related Mortgaged Property or REO
Property a policy complying with the first two sentences of this Section 3.13,
and there shall have been one or more losses which would have been covered by
such policy, deposit to the related Collection Account from its own funds the
amount not otherwise payable under the blanket policy because of such
deductible clause. In connection with its activities as administrator and
servicer of the Mortgage Loans, each Servicer agrees to prepare and present,
on behalf of itself and the Trustee claims under any such blanket policy in a
timely fashion in accordance with the terms of such policy.
(b) Each Servicer shall keep in force during the term of this
Agreement a policy or policies of insurance covering errors and omissions for
failure in the performance of such Servicer's obligations under this
Agreement, which policy or policies shall be in such form and amount that
would meet the requirements of ▇▇▇▇▇▇ Mae or ▇▇▇▇▇▇▇ Mac if it were the
purchaser of the Mortgage Loans, unless such Servicer has obtained a waiver of
such requirements from ▇▇▇▇▇▇ Mae or ▇▇▇▇▇▇▇ Mac. Each Servicer shall also
maintain a fidelity bond in the form and amount that would meet the
requirements of ▇▇▇▇▇▇ Mae or ▇▇▇▇▇▇▇ Mac, unless such Servicer has obtained a
waiver of such requirements from ▇▇▇▇▇▇ Mae or ▇▇▇▇▇▇▇ Mac. Each Servicer
shall provide the Trustee upon request with copies of any such insurance
policies and fidelity bond. Each Servicer shall be deemed to have complied
with this provision if an Affiliate of the applicable Servicer has such errors
and omissions and fidelity bond coverage and, by the terms of such insurance
policy or fidelity bond, the coverage afforded thereunder extends to such
Servicer. Any such errors and omissions policy and fidelity bond shall by its
terms not be cancelable without thirty days' prior written notice to the
Trustee. Each Servicer shall also cause each Subservicer to maintain a policy
of insurance covering errors and omissions and a fidelity bond which would
meet such requirements.
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Section 3.14 Enforcement of "Due-on-Sale" Clauses; Assumption
Agreements. Each Servicer will, to the extent it has knowledge of any
conveyance or prospective conveyance of any Mortgaged Property by any
Mortgagor (whether by absolute conveyance or by contract of sale, and whether
or not the Mortgagor remains or is to remain liable under the Mortgage Note
and/or the Mortgage), exercise its rights to accelerate the maturity of such
Mortgage Loan under the "due-on-sale" clause, if any, applicable thereto;
provided, however, that no Servicer shall be required to take such action if,
in its sole business judgment, such Servicer believes it is not in the best
interests of the Trust Fund and shall not exercise any such rights if
prohibited by law from doing so. If a Servicer reasonably believes it is
unable under applicable law to enforce such "due-on-sale" clause or if any of
the other conditions set forth in the proviso to the preceding sentence apply,
such Servicer will enter into an assumption and modification agreement from or
with the person to whom such property has been conveyed or is proposed to be
conveyed, pursuant to which such person becomes liable under the Mortgage Note
and, to the extent permitted by applicable state law, the Mortgagor remains
liable thereon. Each Servicer is also authorized to enter into a substitution
of liability agreement with such person, pursuant to which the original
Mortgagor is released from liability and such person is substituted as the
Mortgagor and becomes liable under the Mortgage Note; provided, that no such
substitution shall be effective unless such person satisfies the underwriting
criteria of such Servicer and such substitution is in the best interest of the
Certificateholders as determined by such Servicer. In connection with any
assumption, modification or substitution, such Servicer shall apply such
underwriting standards and follow such practices and procedures as shall be
normal and usual in its general mortgage servicing activities and as it
applies to other mortgage loans owned solely by it. No Servicer shall take or
enter into any assumption and modification agreement, however, unless (to the
extent practicable in the circumstances) it shall have received confirmation,
in writing, of the continued effectiveness of any applicable hazard insurance
policy, or a new policy meeting the requirements of this Section is obtained.
Any fee collected by a Servicer in respect of an assumption or substitution of
liability agreement will be retained by such Servicer as additional servicing
compensation. In connection with any such assumption, no material term of the
Mortgage Note (including but not limited to the related Mortgage Rate and the
amount of the Scheduled Payment) may be amended or modified, except as
otherwise required pursuant to the terms thereof. Each Servicer shall notify
the Trustee that any such substitution, modification or assumption agreement
has been completed and shall forward to the Trustee the executed original of
such substitution or assumption agreement, which document shall be added to
the related Mortgage File and shall, for all purposes, be considered a part of
such Mortgage File to the same extent as all other documents and instruments
constituting a part thereof.
Notwithstanding the foregoing paragraph or any other provision of this
Agreement, a Servicer shall not be deemed to be in default, breach or any
other violation of its obligations hereunder by reason of any assumption of a
Mortgage Loan by operation of law or by the terms of the Mortgage Note or any
assumption which such Servicer may be restricted by law from preventing, for
any reason whatsoever. For purposes of this Section 3.14, the term
"assumption" is deemed to also include a sale (of the Mortgaged Property)
subject to the Mortgage that is not accompanied by an assumption or
substitution of liability agreement.
Section 3.15 Realization upon Defaulted Mortgage Loans. Each Servicer
shall use its best efforts, consistent with Accepted Servicing Practices, to
foreclose upon or otherwise comparably convert (which may include an
acquisition of REO Property) the ownership of
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properties securing such of the Mortgage Loans as come into and continue in
default and as to which no satisfactory arrangements can be made for
collection of delinquent payments pursuant to Section 3.07, and which are not
released from this Agreement pursuant to any other provision hereof. Each
Servicer shall use reasonable efforts to realize upon such defaulted Mortgage
Loans in such manner as will maximize the receipt of principal and interest by
the Trustee, taking into account, among other things, the timing of
foreclosure proceedings; provided, however, with respect to any Second Lien
Mortgage Loan for which the related first lien mortgage loan is not included
in the Trust Fund, if, after such Mortgage Loan becomes 180 days or more
delinquent, the applicable Servicer determines that a significant net recovery
is not possible through foreclosure, such Mortgage Loan may be charged off and
the Mortgage Loan will be treated as a Liquidated Mortgage Loan giving rise to
a Realized Loss. The foregoing is subject to the provisions that, in any case
in which Mortgaged Property shall have suffered damage from an uninsured
cause, a Servicer shall not be required to expend its own funds toward the
restoration of such property unless it shall determine in its sole discretion
(i) that such restoration will increase the net proceeds of liquidation of the
related Mortgage Loan to the Trustee, after reimbursement to itself for such
expenses, and (ii) that such expenses will be recoverable by such Servicer
through Insurance Proceeds, Condemnation Proceeds or Liquidation Proceeds from
the related Mortgaged Property, as contemplated in Section 3.11. Each Servicer
shall be responsible for all other costs and expenses incurred by it in any
such proceedings; provided, however, that it shall be entitled to
reimbursement thereof from the related property, as contemplated in Section
3.11.
The proceeds of any liquidation or REO Disposition, as well as any
recovery resulting from a partial collection of Insurance Proceeds,
Condemnation Proceeds or Liquidation Proceeds or any income from an REO
Property, will be applied in the following order of priority: first, to
reimburse the applicable Servicer or any Subservicer for any related
unreimbursed Servicing Advances, pursuant to Section 3.11 or 3.17; second, to
reimburse the applicable Servicer for any related ▇▇▇▇▇▇▇▇▇▇▇▇ ▇&▇ Advances,
pursuant to Section 3.11; third, to accrued and unpaid interest on the
Mortgage Loan or REO Imputed Interest, at the Mortgage Rate, to the date of
the liquidation or REO Disposition, or to the Due Date prior to the Remittance
Date on which such amounts are to be distributed if not in connection with a
liquidation or REO Disposition; and fourth, as a recovery of principal of the
Mortgage Loan. If the amount of the recovery so allocated to interest is less
than a full recovery thereof, that amount will be allocated as follows: first,
to unpaid Servicing Fees; and second, as interest at the Mortgage Rate (net of
the Servicing Fee Rate). The portion of the recovery so allocated to unpaid
Servicing Fees shall be reimbursed to the applicable Servicer or any
Subservicer pursuant to Section 3.11 or 3.17. The portions of the recovery so
allocated to interest at the Mortgage Rate (net of the Servicing Fee Rate) and
to principal of the Mortgage Loan shall be applied as follows: first, to
reimburse the applicable Servicer or any Subservicer for any related
unreimbursed Servicing Advances in accordance with Section 3.11 or 3.17, and
second, to the Trustee in accordance with the provisions of Section 4.02,
subject to the last paragraph of Section 3.17 with respect to certain excess
recoveries from an REO Disposition.
Notwithstanding anything to the contrary contained herein, in
connection with a foreclosure or acceptance of a deed in lieu of foreclosure,
in the event a Servicer has received actual notice of, or has actual knowledge
of the presence of, hazardous or toxic substances or wastes on the related
Mortgaged Property, or if the Trustee otherwise requests, such Servicer
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shall cause an environmental inspection or review of such Mortgaged Property
to be conducted by a qualified inspector. Upon completion of the inspection,
such Servicer shall promptly provide the Trustee and the Depositor with a
written report of the environmental inspection.
After reviewing the environmental inspection report, the applicable
Servicer shall determine consistent with Accepted Servicing Practices how the
Servicer shall proceed with respect to the Mortgaged Property. In the event
(a) the environmental inspection report indicates that the Mortgaged Property
is contaminated by hazardous or toxic substances or wastes and (b) the
applicable Servicer determines, consistent with Accepted Servicing Practices,
to proceed with foreclosure or acceptance of a deed in lieu of foreclosure,
such Servicer shall be reimbursed for all reasonable costs associated with
such foreclosure or acceptance of a deed in lieu of foreclosure and any
related environmental clean-up costs, as applicable, from the related
Liquidation Proceeds, or if the Liquidation Proceeds are insufficient to fully
reimburse such Servicer, such Servicer shall be entitled to be reimbursed from
amounts in the related Collection Account pursuant to Section 3.11. In the
event the applicable Servicer determines not to proceed with foreclosure or
acceptance of a deed in lieu of foreclosure, such Servicer shall be reimbursed
from general collections for all Servicing Advances made with respect to the
related Mortgaged Property from the related Collection Account pursuant to
Section 3.11. The Trustee shall not be responsible for any determination made
by the applicable Servicer pursuant to this paragraph or otherwise.
In the event [_______] elects to charge-off a Second Lien Mortgage
Loan 180 days or more delinquent pursuant to this Section 3.15, no Second Lien
Mortgage Loan shall be characterized as a Liquidated Mortgage Loan, unless the
Depositor consents in writing to such characterization after [_______] has
provided the Depositor with a combined equity analysis of such Second Lien
Mortgage Loan and the related first lien mortgage loan; provided, that if the
Depositor has failed to notify [_______] within 3 Business Days of receipt of
such combined equity analysis, then the Depositor shall be deemed to have
consented to such characterization. In the event [_______] elects to charge
off a Second Lien Mortgage Loan 180 days or more delinquent pursuant to this
Section 3.15, [_______] shall notify the Trustee of such election, which
notice may be provided in a Servicer Remittance Report delivered pursuant to
Section 4.03(d). [_________] may elect to charge-off a Second Lien Mortgage
Loan pursuant to this Section 3.15 without such written consent, so long as
such Second Lien Mortgage Loan is 180 days or more delinquent. [_________]
shall notify the Trustee of such election, which notice may be provided in a
Servicer Remittance Report delivered pursuant to Section 4.03(d).
Section 3.16. Release of Mortgage Files. (a) Upon the payment in full
of any Mortgage Loan, or the receipt by a Servicer of a notification that
payment in full shall be escrowed in a manner customary for such purposes,
such Servicer will, on or before the last day of the month in which such
payment in full occurs, notify the Trustee by a certification (which
certification shall include a statement to the effect that all amounts
received or to be received in connection with such payment which are required
to be deposited in the related Collection Account pursuant to Section 3.10
have been or will be so deposited) of a Servicing Officer and shall request
delivery to it of the Custodial File by submitting a Request for Release (in
writing or an electronic format acceptable to the Trustee) to the Trustee.
Upon receipt of such certification and Request for Release, the Trustee shall
promptly release the related Custodial File to such Servicer within five (5)
Business Days. No expenses incurred in connection with
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any instrument of satisfaction or deed of reconveyance shall be chargeable to
the related Collection Account.
(b) From time to time and as appropriate for the servicing or
foreclosure of any Mortgage Loan, including, for this purpose, collection
under any Insurance Policy relating to the Mortgage Loans, the Trustee shall,
upon request of such Servicer and delivery to the Trustee of a Request for
Release in written or electronic form, release the related Custodial File to
such Servicer, and the Trustee shall, at the direction of such Servicer,
execute such documents as shall be necessary to the prosecution of any such
proceedings and such Servicer shall retain the Mortgage File in trust for the
benefit of the Trustee. Such Request for Release shall obligate the applicable
Servicer to return each and every document previously requested from the
Custodial File to the Trustee when the need therefor by such Servicer no
longer exists, unless the Mortgage Loan has been charged-off or liquidated and
the Liquidation Proceeds relating to the Mortgage Loan have been deposited in
the related Collection Account or the Mortgage File or such document has been
delivered to an attorney, or to a public trustee or other public official as
required by law, for purposes of initiating or pursuing legal action or other
proceedings for the foreclosure of the Mortgaged Property either judicially or
non-judicially, and such Servicer has delivered to the Trustee a certificate
of a Servicing Officer certifying as to the name and address of the Person to
which such Mortgage File or such document was delivered and the purpose or
purposes of such delivery. Upon receipt of a certificate of a Servicing
Officer stating that such Mortgage Loan was charged-off or liquidated and that
all amounts received or to be received in connection with such liquidation
that are required to be deposited into the related Collection Account have
been so deposited, or that such Mortgage Loan has become an REO Property, a
copy of the Request for Release shall be released by the Trustee to the
applicable Servicer or its designee upon request therefor. Upon receipt of a
Request for Release under this Section 3.16, the Trustee shall deliver the
related Custodial File to the requesting Servicer; provided, however, that in
the event a Servicer has not previously received copies of the relevant
Mortgage Loan Documents necessary to service the related Mortgage Loan in
accordance with Accepted Servicing Practices, the Responsible Party shall
reimburse the Trustee for any overnight courier charges incurred for the
requested Custodial Files.
Upon written certification of a Servicing Officer, the Trustee shall
execute and deliver to the applicable Servicer copies of any court pleadings,
requests for trustee's sale or other documents reasonably necessary to the
foreclosure or trustee's sale in respect of a Mortgaged Property or to any
legal action brought to obtain judgment against any Mortgagor on the Mortgage
Note or Mortgage or to obtain a deficiency judgment, or to enforce any other
remedies or rights provided by the Mortgage Note or Mortgage or otherwise
available at law or in equity, or shall exercise and deliver to such Servicer
a power of attorney sufficient to authorize such Servicer to execute such
documents on its behalf. Each such certification shall include a request that
such pleadings or documents be executed by the Trustee and a statement as to
the reason such documents or pleadings are required and that the execution and
delivery thereof by the Trustee will not invalidate or otherwise affect the
lien of the Mortgage, except for the termination of such a lien upon
completion of the foreclosure or trustee's sale.
Section 3.17 Title, Conservation and Disposition of REO Property. (a)
This Section shall apply only to REO Properties acquired for the account of
the Trustee and shall not apply to any REO Property relating to a Mortgage
Loan which was purchased or repurchased
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from the Trustee pursuant to any provision hereof. In the event that title to
any such REO Property is acquired, the applicable Servicer shall cause the
deed or certificate of sale to be issued in the name of the Trustee, on behalf
of the Certificateholders. Upon written request by the applicable Servicer,
the Trustee shall provide such Servicer with a power of attorney prepared by
such Servicer with respect to such REO Property.
(b) Each Servicer shall manage, conserve, protect and operate each
related REO Property for the Trustee solely for the purpose of its prompt
disposition and sale. Each Servicer, either itself or through an agent
selected by such Servicer, shall manage, conserve, protect and operate the REO
Property in the same manner that it manages, conserves, protects and operates
other foreclosed property for its own account, and in the same manner that
similar property in the same locality as the REO Property is managed. Each
Servicer shall attempt to sell the same (and may temporarily rent the same for
a period not greater than one year, except as otherwise provided below) on
such terms and conditions as such Servicer deems to be in the best interest of
the Trustee. The Trustee shall have no obligations with respect to any REO
Dispositions.
(c) Each Servicer shall segregate and hold all funds collected and
received in connection with the operation of any REO Property separate and
apart from its own funds and general assets and shall deposit such funds in
the related Collection Account.
(d) Each Servicer shall deposit net of reimbursement to such Servicer
for any related outstanding Servicing Advances and unpaid Servicing Fees
provided in Section 3.11, or cause to be deposited, in no event more than two
(2) Business Days following such Servicer's receipt thereof in the related
Collection Account all revenues received with respect to the related REO
Property and shall withdraw therefrom funds necessary for the proper
operation, management and maintenance of the REO Property.
(e) Each Servicer, upon an REO Disposition, shall be entitled to
reimbursement for any related unreimbursed Servicing Advances as well as any
unpaid Servicing Fees from proceeds received in connection with the REO
Disposition, as further provided in Section 3.11.
(f) Any net proceeds from an REO Disposition which are in excess of
the unpaid principal balance of the related Mortgage Loan plus all unpaid REO
Imputed Interest thereon through the date of the REO Disposition shall be
retained by the applicable Servicer as additional servicing compensation.
(g) Each Servicer shall use its reasonable best efforts to sell, or
cause its Subservicer to sell, in accordance with Accepted Servicing
Practices, any REO Property serviced by such Servicer or Subservicer as soon
as possible, but in no event later than the conclusion of the third calendar
year beginning after the year of its acquisition by Pooling-Tier REMIC-1
unless (i) such Servicer applies for an extension of such period from the
Internal Revenue Service pursuant to the REMIC Provisions and Code Section
856(e)(3), in which event such REO Property shall be sold within the
applicable extension period, or (ii) such Servicer obtains for the Trustee an
Opinion of Counsel, addressed to the Depositor, the Trustee and such Servicer,
to the effect that the holding by the Pooling-Tier REMIC-1 of such REO
Property subsequent to
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such period will not result in the imposition of taxes on "prohibited
transactions" as defined in Section 860F of the Code or cause any Trust REMIC
to fail to qualify as a REMIC under the REMIC Provisions or comparable
provisions of relevant state laws at any time. Each Servicer shall manage,
conserve, protect and operate each REO Property serviced by such Servicer for
the Trustee 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) or result in
the receipt by the Pooling-Tier REMIC-1 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 Section
860G(a)(1) of the Code. Pursuant to its efforts to sell such REO Property, the
applicable 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 on behalf of the Certificateholders, rent the same, or any part
thereof, as such Servicer deems to be in the best interest of the Trustee on
behalf of the Certificateholders for the period prior to the sale of such REO
Property; provided, however, that any rent received or accrued with respect to
such REO Property qualifies as "rents from real property" as defined in
Section 856(d) of the Code.
Section 3.18 Notification of Adjustments. With respect to each
Adjustable Rate Mortgage Loan, the applicable Servicer shall adjust the
Mortgage Rate on the related Adjustment Date and shall adjust the Scheduled
Payment on the related mortgage payment adjustment date, if applicable, in
compliance with the requirements of applicable law and the related Mortgage
and Mortgage Note. In the event that an Index becomes unavailable or otherwise
unpublished, the related Servicer shall select a comparable alternative index
over which it has no direct control and which is readily verifiable. Each
Servicer shall execute and deliver any and all necessary notices required
under applicable law and the terms of the related Mortgage Note and Mortgage
regarding the Mortgage Rate and Scheduled Payment adjustments. Each Servicer
shall promptly, upon written request therefor, deliver to the Trustee such
notifications and any additional applicable data regarding such adjustments
and the methods used to calculate and implement such adjustments. Upon the
discovery by a Servicer or the receipt of notice from the Trustee that a
Servicer has failed to adjust a Mortgage Rate or Scheduled Payment in
accordance with the terms of the related Mortgage Note, such Servicer shall
deposit in the related Collection Account from its own funds the amount of any
interest loss caused as such interest loss occurs.
Section 3.19 Access to Certain Documentation and Information Regarding
the Mortgage Loans. The applicable Servicer shall provide, or cause the
Subservicer to provide, to the Depositor, the Trustee, the OTS or the FDIC and
the examiners and supervisory agents thereof, access to the documentation
regarding the Mortgage Loans in its possession required by applicable
regulations of the OTS. Such access shall be afforded without charge, but only
upon five (5) Business Days' prior written request and during normal business
hours at the offices of the applicable Servicer or any Subservicer. Nothing in
this Section shall derogate from the obligation of any such party to observe
any applicable law prohibiting disclosure of information regarding the
Mortgagors and the failure of any such party to provide access as provided in
this Section as a result of such obligation shall not constitute a breach of
this Section.
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Section 3.20 Documents, Records and Funds in Possession of the
Servicers to Be Held for the Trustee. Each Servicer shall account fully to the
Trustee for any funds received by such Servicer or which otherwise are
collected by such Servicer as Liquidation Proceeds, Condemnation Proceeds or
Insurance Proceeds in respect of any Mortgage Loan serviced by such Servicer.
All Mortgage Files and funds collected or held by, or under the control of, a
Servicer in respect of any Mortgage Loans, whether from the collection of
principal and interest payments or from Liquidation Proceeds, including, but
not limited to, any funds on deposit in its Collection Account, shall be held
by such Servicer for and on behalf of the Trustee and shall be and remain the
sole and exclusive property of the Trustee, subject to the applicable
provisions of this Agreement. Each Servicer also agrees that it shall not
create, incur or subject any Mortgage File or any funds that are deposited in
any Collection Account, the Distribution Account or any Escrow Account, or any
funds that otherwise are or may become due or payable to the Trustee for the
benefit of the Certificateholders, to any claim, lien, security interest,
judgment, levy, writ of attachment or other encumbrance, or assert by legal
action or otherwise any claim or right of setoff against any Mortgage File or
any funds collected on, or in connection with, a Mortgage Loan, except,
however, that such Servicer shall be entitled to set off against and deduct
from any such funds any amounts that are properly due and payable to such
Servicer under this Agreement.
Section 3.21 Servicing Compensation. (a) As compensation for its
activities hereunder, each Servicer shall, with respect to each Mortgage Loan
serviced by it, be entitled to retain from deposits to its Collection Account
and from Liquidation Proceeds, Condemnation Proceeds, Insurance Proceeds and
REO Proceeds related to such Mortgage Loan, the Servicing Fee with respect to
each Mortgage Loan (less any portion of such amounts retained by any
Subservicer). In addition, each Servicer shall be entitled to recover unpaid
Servicing Fees out of related late collections to the extent permitted in
Section 3.11. The right to receive the Servicing Fee may not be transferred in
whole or in part except in connection with the transfer of all of a Servicer's
responsibilities and obligations under this Agreement; provided, however, that
each Servicer may pay from the Servicing Fee any amounts due to a Subservicer
pursuant to a Subservicing Agreement entered into under Section 3.02.
(b) Additional servicing compensation in the form of assumption or
modification fees, late payment charges, NSF fees, reconveyance fees and other
similar fees and charges (other than Prepayment Charges) shall be retained by
a Servicer only to the extent such fees or charges are received by such
Servicer. Each Servicer shall also be entitled pursuant to Section 3.11(a)(iv)
to withdraw from the related Collection Account, and pursuant to Section
3.07(e), to direct the Trustee to withdraw from the Distribution Account and
remit to the applicable Servicer (except for monies invested during the
Trustee Float Period), as additional servicing compensation, interest or other
income earned on the related portions of deposits therein. Each Servicer shall
also be entitled as additional servicing compensation, to interest or other
income earned on deposits in the related Escrow Account (to the extent
permitted by law and the related Mortgage Loan documents) in accordance with
Section 3.12. [_______] and [_________] shall also be entitled to retain net
Prepayment Interest Excesses (to the extent not required to offset Prepayment
Interest Shortfalls), but only to the extent such amounts are received by such
Servicer.
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(c) Each Servicer shall be required to pay all expenses incurred by it
in connection with its servicing activities hereunder (including payment of
premiums for any blanket policy insuring against hazard losses pursuant to
Section 3.13, servicing compensation of the Subservicer to the extent not
retained by it and the fees and expenses of independent accountants and any
agents appointed by such Servicer), and shall not be entitled to reimbursement
therefor from the Trust Fund except as specifically provided in Section 3.11.
Section 3.22......Annual Statement as to Compliance. Each Servicer
shall deliver or cause to be delivered, and shall cause each Subservicer
engaged by such Servicer to deliver or cause to be delivered to the Depositor,
the Rating Agencies and the Trustee on or before March [_] of each calendar
year, commencing in 2007, an Officer's Certificate stating, as to each
signatory thereof, that (i) a review of the activities of the Servicer or
Subservicer, as applicable, during the preceding calendar year and of its
performance under this Agreement or the applicable Subservicing Agreement, as
the case may be, has been made under such officers' supervision, and (ii) to
the best of such officers' knowledge, based on such review, such Servicer or
Subservicer, as applicable, has fulfilled all of its obligations under this
Agreement or the applicable Subservicing Agreement, as the case may be, in all
material respects, throughout such year, or, if there has been a default in
the fulfillment of any such obligation in any material respect, specifying
each such default known to such officers and the nature and status thereof.
Promptly after receipt of each such Officer's Certificate, the Depositor shall
review each such Officer's Certificate and, if applicable, consult with the
Trustee, Servicer or Subservicer as to the nature of any defaults by the
Trustee, Servicer or any related Subservicer in the fulfillment of any of the
Trustee's, such Servicer's or any related Subservicer's obligations. The
obligations of the Trustee, each Servicer and each Subservicer under this
Section apply to the Trustee, each Servicer and each Subservicer that acted as
Trustee or serviced a Mortgage Loan, as applicable, during the applicable
period, whether or not the Trustee, such Servicer or such Subservicer is
acting as the Trustee, a Servicer or a Subservicer at the time such Officer's
Certificate is required to be delivered. None of the Trustee, Servicer or
Subservicer shall be required to cause the delivery of any Officer's
Certificate required by this Section until March [_] in any given year so long
as it has received written confirmation from the Depositor that a Form 10-K is
not required to be filed in respect of the Trust for the preceding calendar
year.
Section 3.23 Annual Reports on Assessment of Compliance with Servicing
Criteria; Annual Independent Public Accountants' Attestation Report. (a) Not
later than March [_] of each calendar year commencing in 2007, each Servicer
and the Trustee shall deliver, and each Servicer shall cause each Subservicer
engaged by such Servicer and such Servicer and the Trustee shall cause each
Subcontractor utilized by such Servicer (or by any Subservicer) or the
Trustee, as applicable, and determined by such Servicer or the Trustee, as
applicable, pursuant to Section 3.02(e) to be "participating in a servicing
function" within the meaning of Item 1122 of Regulation AB (in each case, a
"Servicing Function Participant"), to deliver, each at its own expense, to the
Depositor and the Trustee, a report on an assessment of compliance with the
Servicing Criteria applicable to it that contains (A) a statement by such
party of its responsibility for assessing compliance with the Servicing
Criteria applicable to it, (B) a statement that such party used the Servicing
Criteria to assess compliance with the applicable Servicing Criteria, (C) such
party's assessment of compliance with the applicable Servicing Criteria as of
and for the period ending the end of the fiscal year covered by the Form 10-K
required to be filed pursuant to Section 8.12, including, if there has been
any material
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instance of noncompliance with the applicable Servicing Criteria, a discussion
of each such failure and the nature and status thereof, and (D) a statement
that a registered public accounting firm has issued an attestation report on
such Person's assessment of compliance with the applicable Servicing Criteria
as of and for such period. Each such assessment of compliance report shall be
addressed to the Depositor and signed by an authorized officer of the
applicable company, and shall address each of the applicable Servicing
Criteria set forth on Exhibit P hereto, or as set forth in the notification
furnished to the Depositor and the Trustee pursuant to Section 3.23(c). The
Servicer and the Trustee hereby acknowledge and agree that their respective
assessments of compliance will cover the items identified on Exhibit P hereto
as being covered by such party. The parties to this Agreement acknowledge that
where a particular Servicing Criteria has multiple components, each party's
assessment of compliance (and related attestation of compliance) will relate
only to those components that are applicable to such party. Promptly after
receipt of each such report on assessment of compliance, the Depositor shall
review each such report and, if applicable, consult with the applicable
Servicer or the Trustee as to the nature of any material instance of
noncompliance with the Servicing Criteria applicable to it (and each
Subservicer or Servicing Function Participant engaged or utilized by the
applicable Servicer, such Subservicer or the Trustee, as applicable), as the
case may be. None of the Servicers, the Trustee or any Subservicer or
Servicing Function Participant shall be required to cause the delivery of any
such assessments until March [_] in any given year so long as it has received
written confirmation from the Depositor that a Form 10-K is not required to be
filed in respect of the Trust for the preceding calendar year.
(b) Not later than March [_] of each calendar year commencing in 2007,
the Trustee and each Servicer shall cause, and each Subservicer engaged by the
Servicer, and each Servicer and the Trustee shall cause each Servicing
Function Participant utilized by the Trustee or such Servicer, as applicable
(or by any Subservicer engaged by such Servicer), to cause, each at its own
expense, a registered public accounting firm (which may also render other
services to such party) and that is a member of the American Institute of
Certified Public Accountants to furnish a report to the Trustee and the
Depositor, with a copy to the Rating Agencies, to the effect that (i) it has
obtained a representation regarding certain matters from the management of
such Person, which includes an assertion that such Person has complied with
the Servicing Criteria applicable to it pursuant to Section 3.23(a) and (ii)
on the basis of an examination conducted by such firm in accordance with
standards for attestation engagements issued or adopted by the PCAOB, that
attests to and reports on such Person's assessment of compliance with the
Servicing Criteria applicable to it. In the event that an overall opinion
cannot be expressed, such registered public accounting firm shall state in
such report why it was unable to express such an opinion. Each such related
accountant's attestation report shall be made in accordance with Rules
1-02(a)(3) and 2-02(g) of Regulation S-X under the Securities Act and the
Exchange Act. Such report must be available for general use and not contain
restricted use language. Promptly after receipt of each such accountants'
attestation report, the Depositor shall review the report and, if applicable,
consult with the applicable Servicer or the Trustee as to the nature of any
defaults by the applicable Servicer or the Trustee (and each Subservicer or
Servicing Function Participant engaged or utilized by any Servicer or the
Trustee, as applicable, or by any Subservicer engaged by the Servicer), as the
case may be, as the case may be, in the fulfillment of any of the Servicers',
the Trustee's or the applicable Subservicer's or Servicing Function
Participant's obligations hereunder or under any applicable sub-servicing
agreement. None of the Servicers or the Trustee or any Servicing Function
Participant shall be required to
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cause the delivery of any such attestation required by this paragraph until
March [_] in any given year so long as it has received written confirmation
from the Depositor that a Form 10-K is not required to be filed in respect of
the Trust for the preceding calendar year.
(c) No later than March [_] of each fiscal year, commencing in 2007,
each Servicer shall notify the Trustee and the Depositor as to the name of
each Subservicer engaged by it and each Servicing Function Participant
utilized by it and by each Subservicer engaged by it, but only to the extent
there has been a change in the information in such notification from notices
previously delivered and the Trustee shall notify the Depositor as to the name
of each Servicing Function Participant utilized by it and each such notice
will specify what specific Servicing Criteria will be addressed in the report
on assessment of compliance prepared by such Servicing Function Participant in
each case, to the extent of any change from the prior year's notice, if any.
When a Servicer or the Trustee submits its assessment pursuant to Section
3.23(a), such Servicer and the Trustee, as applicable, will also at such time
include the assessment (and related attestation pursuant to Section 3.23(b))
of each Servicing Function Participant utilized by it and by each Subservicer
engaged by it.
Section 3.24 Trustee to Act as Servicer. (a) Subject to Section 7.02,
in the event that any Servicer shall for any reason no longer be a Servicer
hereunder (including by reason of an Event of Default), the Trustee or its
successor shall thereupon assume all of the rights and obligations of such
Servicer hereunder arising thereafter (except that the Trustee shall not be
(i) liable for losses of such predecessor servicer pursuant to Section 3.10 or
any acts or omissions of such predecessor servicer hereunder), (ii) obligated
to effectuate repurchases or substitutions of Mortgage Loans hereunder,
including but not limited to repurchases or substitutions pursuant to Section
2.03, (iii) responsible for expenses of such predecessor servicer pursuant to
Section 2.03 or (iv) deemed to have made any representations and warranties of
such Servicer hereunder. Any such assumption shall be subject to Section 7.02.
(b) Every Subservicing Agreement entered into by a Servicer shall
contain a provision giving the successor servicer the option to terminate such
agreement in the event a successor servicer is appointed.
(c) If any Servicer shall for any reason no longer be a Servicer
(including by reason of any Event of Default), the Trustee (or any other
successor servicer) may, at its option, succeed to any rights and obligations
of such Servicer under any Subservicing Agreement in accordance with the terms
thereof; provided that the Trustee (or any other successor servicer) shall not
incur any liability or have any obligations in its capacity as successor
servicer under a Subservicing Agreement arising prior to the date of such
succession unless it expressly elects to succeed to the rights and obligations
of such Servicer thereunder; and such Servicer shall not thereby be relieved
of any liability or obligations under the Subservicing Agreement arising prior
to the date of such succession.
(d) The applicable Servicer shall, upon request of the Trustee, but at
the expense of such Servicer, deliver to the assuming party all documents and
records relating to each Subservicing Agreement (if any) to which it is party
and the Mortgage Loans then being serviced thereunder and an accounting of
amounts collected and held by it and otherwise use its
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best efforts to effect the orderly and efficient transfer of such Subservicing
Agreement to the assuming party.
Section 3.25 Compensating Interest. Each Servicer shall remit to
the Trustee on each Remittance Date for deposit in the Distribution Account an
amount from its own funds equal to the Compensating Interest payable by such
Servicer for the related Distribution Date.
Section 3.26 Credit Reporting; ▇▇▇▇▇-▇▇▇▇▇-▇▇▇▇▇▇ Act. (a) With
respect to each Mortgage Loan, each Servicer agrees to fully furnish, in
accordance with the Fair Credit Reporting Act and its implementing
regulations, accurate and complete information (e.g., favorable and
unfavorable) on its borrower credit files to Equifax, Experian and 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 Mortgage Loans required to be serviced by it and the related borrowers and
shall provide all required notices thereunder.
ARTICLE IV
DISTRIBUTIONS AND
ADVANCES BY THE SERVICERS
Section 4.01 Advances. (a) The amount of P&I Advances to be made
by each Servicer for any Remittance Date shall equal, subject to Section
4.01(c), the sum of (i) the aggregate amount of Scheduled Payments (with each
interest portion thereof net of the related Servicing Fee), due during the Due
Period immediately preceding such Remittance Date in respect of the Mortgage
Loans serviced by such Servicer, which Scheduled Payments were not received as
of the close of business on the related Determination Date (provided, however,
that with respect to any Balloon Loan that is delinquent on its maturity date,
the applicable Servicer will not be required to advance the principal portion
of the related balloon payment but will be required to continue to make P&I
Advances in accordance with this Section 4.01(a) with respect to such Balloon
Loan in an amount equal to the assumed scheduled interest that would otherwise
be due based on the original amortization schedule for such Balloon Loan (with
interest at the Adjusted Net Mortgage Rate)), plus (ii) with respect to each
REO Property serviced by such Servicer, which REO Property was acquired during
or prior to the related Prepayment Period and as to which such REO Property an
REO Disposition did not occur during the related Prepayment Period, an amount
equal to the excess, if any, of the Scheduled Payments (with each interest
portion thereof net of the related Servicing Fee) that would have been due on
the related Due Date in respect of the related Mortgage Loans, over the net
income from such REO Property transferred to the related Collection Account
for distribution on such Remittance Date.
(b) On each Remittance Date, each Servicer shall remit in immediately
available funds to the Trustee an amount equal to the aggregate amount of P&I
Advances, if any, to be made in respect of the Mortgage Loans and REO
Properties serviced by such Servicer for the related Remittance Date either
(i) from its own funds or (ii) from the related Collection Account, to the
extent of funds held therein for future distribution (in which case, it will
cause to
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be made an appropriate entry in the records of the related Collection Account
that Amounts Held for Future Distribution have been, as permitted by this
Section 4.01, used by such Servicer in discharge of any such P&I Advance) or
(iii) in the form of any combination of (i) and (ii) aggregating the total
amount of P&I Advances to be made by such Servicer with respect to such
Mortgage Loans and REO Properties. Any Amounts Held for Future Distribution
and so used shall be appropriately reflected in such Servicer's records and
replaced by such Servicer by deposit in the related Collection Account on or
before any future Remittance Date to the extent required.
(c) The obligation of each Servicer to make such P&I Advances is
mandatory, notwithstanding any other provision of this Agreement but subject
to paragraph (d) below, and, with respect to any Mortgage Loan or REO
Property, shall continue until a Final Recovery Determination in connection
therewith or the removal thereof from coverage under this Agreement, except as
otherwise provided in this Section.
(d) Notwithstanding anything herein to the contrary, no P&I Advance or
Servicing Advance shall be required to be made hereunder by any Servicer if
such P&I Advance or Servicing Advance would, if made, constitute a
Nonrecoverable P&I Advance or Nonrecoverable Servicing Advance. The
determination by any Servicer that it has made a Nonrecoverable P&I Advance or
a Nonrecoverable Servicing Advance or that any proposed P&I Advance or
Servicing Advance, if made, would constitute a Nonrecoverable P&I Advance or a
Nonrecoverable Servicing Advance, respectively, shall be evidenced by an
Officer's Certificate of such Servicer delivered to the Trustee.
(e) Except as otherwise provided herein, the applicable Servicer shall
be entitled to reimbursement pursuant to Section 3.11 for Servicing Advances
from recoveries from the related Mortgagor or from all Liquidation Proceeds
and other payments or recoveries (including Insurance Proceeds and
Condemnation Proceeds) with respect to the related Mortgage Loan.
Section 4.02 Priorities of Distribution. (a) On each Distribution
Date, the Trustee shall allocate from amounts then on deposit in the
Distribution Account in the following order of priority and to the extent of
the Available Funds remaining and, on such Distribution Date, shall make
distributions on the Certificates in accordance with such allocation:
(i) to the holders of each Class of Offered Certificates and to the
Swap Account in the following order of priority:
(A) to the Swap Account, the sum of (x) all Net Swap Payments
and (y) any Swap Termination Payment owed to the Swap Provider,
including, without limitation, any Senior Defaulted Swap Termination
Payment but not including any other Defaulted Swap Termination
Payment;
(B) to the Class A-1, Class A-2, Class A-3 and Class A-4
Certificates, the related Accrued Certificate Interest Distribution
Amounts and any related Unpaid Interest Amounts for such Distribution
Date, allocated pro rata based on their respective entitlements to
those amounts;
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(C) from any remaining Interest Remittance Amounts, to the
Class M-1 Certificates, the Accrued Certificate Interest Distribution
Amount for such Class on such Distribution Date;
(D) from any remaining Interest Remittance Amounts, to the
Class M-2 Certificates, the Accrued Certificate Interest Distribution
Amount for such Class on such Distribution Date;
(E) from any remaining Interest Remittance Amounts, to the
Class M-3 Certificates, the Accrued Certificate Interest Distribution
Amount for such Class on such Distribution Date;
(F) from any remaining Interest Remittance Amounts, to the
Class M-4 Certificates, the Accrued Certificate Interest Distribution
Amount for such Class on such Distribution Date;
(G) from any remaining Interest Remittance Amounts, to the
Class M-5 Certificates, the Accrued Certificate Interest Distribution
Amount for such Class on such Distribution Date;
(H) from any remaining Interest Remittance Amounts, to the
Class M-6 Certificates, the Accrued Certificate Interest Distribution
Amount for such Class on such Distribution Date;
(I) from any remaining Interest Remittance Amounts, to the
Class B-1 Certificates, the Accrued Certificate Interest Distribution
Amount for such Class on such Distribution Date;
(J) from any remaining Interest Remittance Amounts, to the
Class B-2 Certificates, the Accrued Certificate Interest Distribution
Amount for such Class on such Distribution Date; and
(K) from any remaining Interest Remittance Amounts, to the
Class B-3 Certificates, the Accrued Certificate Interest Distribution
Amount for such Class on such Distribution Date;
(ii) (A) on each Distribution Date (1) before the Stepdown Date or (2)
with respect to which a Trigger Event is in effect, to the holders of the
related Class or Classes of Offered Certificates then entitled to
distributions of principal as set forth below, from amounts remaining on
deposit in the Distribution Account after making distributions pursuant
to clause (i) above, an amount equal to the Principal Distribution Amount
in the following order of priority:
(1) to the Class A Certificates, allocated as
described in Section 4.02(b), until the respective Class
Certificate Balances thereof are reduced to zero; and
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(2) sequentially to the Class ▇-▇, ▇▇▇▇▇ ▇-▇, Class
M-3, Class M-4, Class M-5, Class M-6, Class B-1, Class B-2 and
Class B-3 Certificates, in that order, until the respective
Class Certificate Balances are reduced to zero;
(B) on each Distribution Date (1) on and after the Stepdown
Date and (2) as long as a Trigger Event is not in effect, to the
holders of the related Class or Classes of Offered Certificates then
entitled to distribution of principal, from amounts remaining on
deposit in the Distribution Account after making distributions
pursuant to clause (i) above, an amount equal to, in the aggregate,
the Principal Distribution Amount in the following amounts and order
of priority:
(1) to the Class A Certificates, the lesser of (x) the
Principal Distribution Amount and (y) the Class A Principal
Distribution Amount, allocated as described in Section
4.02(b), until the respective Class Certificate Balances
thereof are reduced to zero;
(2) to the Class M-1 Certificates, the lesser of (x)
the excess of (i) the Principal Distribution Amount over (ii)
the amount distributed to the Class A Certificateholders in
clause (ii)(B)(a) above and (y) the Class M-1 Principal
Distribution Amount, until the Class Certificate Balance
thereof has been reduced to zero;
(3) to the Class M-2 Certificates, the lesser of (x)
the excess of (i) the Principal Distribution Amount over (ii)
the amount distributed to the Class A Certificateholders in
clause (ii)(B)(a) above and to the Class M-1 Certificates in
clause (ii)(B)(b) above and (y) the Class M-2 Principal
Distribution Amount, until the Class Certificate Balance
thereof has been reduced to zero;
(4) to the Class M-3 Certificates, the lesser of (x)
the excess of (i) the Principal Distribution Amount over (ii)
the amount distributed to the Class A Certificateholders in
clause (ii)(B)(a) above, to the Class M-1 Certificates in
clause (ii)(B)(b) above and to the Class M-2 Certificates in
clause (ii)(B)(c) above and (y) the Class M-3 Principal
Distribution Amount, until the Class Certificate Balance
thereof has been reduced to zero;
(5) to the Class M-4 Certificates, the lesser of (x)
the excess of (i) the Principal Distribution Amount over (ii)
the amount distributed to the Class A Certificateholders in
clause (ii)(B)(a) above, to the Class M-1 Certificates in
clause (ii)(B)(b) above, to the Class M-2 Certificates in
clause (ii)(B)(c) above and to the Class M-3 Certificates in
clause (ii)(B)(d) above and (y) the Class M-4 Principal
Distribution Amount, until the Class Certificate Balance
thereof has been reduced to zero;
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(6) to the Class M-5 Certificates, the lesser of (x)
the excess of (i) the Principal Distribution Amount over (ii)
the amount distributed to the Class A Certificateholders in
clause (ii)(B)(a) above, to the Class M-1 Certificates in
clause (ii)(B)(b) above, to the Class M-2 Certificates in
clause (ii)(B)(c) above, to the Class M-3 Certificates in
clause (ii)(B)(d) above and to the Class M-4 Certificates in
clause (ii)(B)(e) above and (y) the Class M-5 Principal
Distribution Amount, until the Class Certificate Balance
thereof has been reduced to zero;
(7) to the Class M-6 Certificates, the lesser of (x)
the excess of (i) the Principal Distribution Amount over (ii)
the amount distributed to the Class A Certificateholders in
clause (ii)(B)(a) above, to the Class M-1 Certificates in
clause (ii)(B)(b) above, to the Class M-2 Certificates in
clause (ii)(B)(c) above, to the Class M-3 Certificates in
clause (ii)(B)(d) above, to the Class M-4 Certificates in
clause (ii)(B)(e) above and to the Class M-5 Certificates in
clause (ii)(B)(f) above and (y) the Class M-6 Principal
Distribution Amount, until the Class Certificate Balance
thereof has been reduced to zero;
(8) to the Class B-1 Certificates, the lesser of (x)
the excess of (i) the Principal Distribution Amount over (ii)
the amount distributed to the Class A Certificateholders in
clause (ii)(B)(a) above, to the Class M-1 Certificates in
clause (ii)(B)(b) above, to the Class M-2 Certificates in
clause (ii)(B)(c) above, to the Class M-3 Certificates in
clause (ii)(B)(d) above, to the Class M-4 Certificates in
clause (ii)(B)(e) above, to the Class M-5 Certificates in
clause (ii)(B)(f) above and to the Class M-6 Certificates in
clause (ii)(B)(g) above and (y) the Class B-1 Principal
Distribution Amount, until the Class Certificate Balance
thereof has been reduced to zero;
(9) to the Class B-2 Certificates, the lesser of (x)
the excess of (i) the Principal Distribution Amount over (ii)
the amount distributed to the Class A Certificateholders in
clause (ii)(B)(a) above, to the Class M-1 Certificates in
clause (ii)(B)(b) above, to the Class M-2 Certificates in
clause (ii)(B)(c) above, to the Class M-3 Certificates in
clause (ii)(B)(d) above, to the Class M-4 Certificates in
clause (ii)(B)(e) above, to the Class M-5 Certificates in
clause (ii)(B)(f) above, to the Class M-6 Certificates in
clause (ii)(B)(g) above and to the Class B-1 Certificates in
clause (ii)(B)(h) above and (y) the Class B-2 Principal
Distribution Amount, until the Class Certificate Balance
thereof has been reduced to zero; and
(10) to the Class B-3 Certificates, the lesser of (x)
the excess of (i) the Principal Distribution Amount over (ii)
the amount distributed to the Class A Certificateholders in
clause (ii)(B)(a) above, to the Class M-1 Certificates in
clause (ii)(B)(b) above, to the Class M-2 Certificates in
clause (ii)(B)(c) above, to the Class M-3 Certificates in
clause (ii)(B)(d)
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above, to the Class M-4 Certificates in clause (ii)(B)(e)
above, to the Class M-5 Certificates in clause (ii)(B)(f)
above, to the Class M-6 Certificates in clause (ii)(B)(g)
above, to the Class B-1 Certificates in clause (ii)(B)(h)
above and to the Class B-2 Certificates in clause (ii)(B)(i)
above and (y) the Class B-3 Principal Distribution Amount,
until the Class Certificate Balance thereof has been reduced
to zero;
(iii) any amount remaining after the distributions in clauses (i) and
(ii) above, plus as specifically indicated below, from amounts on deposit
in the Excess Reserve Fund Account, shall be distributed in the following
order of priority:
(A) to the Class M-1 Certificates, any Unpaid Interest Amount
for such Class;
(B) to the Class M-1 Certificates, any Unpaid Realized Loss
Amount for such Class;
(C) to the Class M-2 Certificates, any Unpaid Interest Amount
for such Class;
(D) to the Class M-2 Certificates, any Unpaid Realized Loss
Amount for such Class;
(E) to the Class M-3 Certificates, any Unpaid Interest Amount
for such Class; (F) to the Class M-3 Certificates, any Unpaid Realized
Loss Amount for such Class;
(G) to the Class M-4 Certificates, any Unpaid Interest Amount
for such Class;
(H) to the Class M-4 Certificates, any Unpaid Realized Loss
Amount for such Class;
(I) to the Class M-5 Certificates, any Unpaid Interest Amount
for such Class;
(J) to the Class M-5 Certificates, any Unpaid Realized Loss
Amount for such Class;
(K) to the Class M-6 Certificates, any Unpaid Interest Amount
for such Class;
(L) to the Class M-6 Certificates, any Unpaid Realized Loss
Amount for such Class;
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(M) to the Class B-1 Certificates, any Unpaid Interest Amount
for such Class;
(N) to the Class B-1 Certificates, any Unpaid Realized Loss
Amount for such Class;
(O) to the Class B-2 Certificates, any Unpaid Interest Amount
for such Class;
(P) to the Class B-2 Certificates, any Unpaid Realized Loss
Amount for such Class;
(Q) to the Class B-3 Certificates, any Unpaid Interest Amount
for such Class;
(R) to the Class B-3 Certificates, any Unpaid Realized Loss
Amount for such Class;
(S) to the Excess Reserve Fund Account, the amount of any
Basis Risk Payment (without regard to Net Swap Receipts) for such
Distribution Date;
(T) from funds on deposit in the Excess Reserve Fund Account
with respect to such Distribution Date, an amount equal to any
remaining Basis Risk Carry Forward Amount with respect to the Offered
Certificates for such Distribution Date, allocated to the Offered
Certificates in the same order and priority in which the Accrued
Certificate Interest Distribution Amount is allocated among such
Classes of Certificates, with the allocation to the Class A
Certificates being (a) first, among the Class A Certificates, pro
rata, based on their respective Class Certificate Balances and (b)
second, any remaining amounts to the Class A Certificates, pro rata,
based on any Basis Risk Carry Forward Amounts remaining unpaid, in
order to reimburse such unpaid amounts;
(U) to the Swap Account, the amount of any remaining Defaulted
Swap Termination Payment owed to the Swap Provider;
(V) to the Class X Certificates, the remainder of the Class X
Distributable Amount not distributed pursuant to Sections
4.02(a)(iii)(A)-(U); and
(W) to the Class R Certificates, any remaining amount in the
Trust REMICs.
If on any Distribution Date, as a result of the foregoing allocation
rules, any Class of Class A Certificates does not receive in full the related
Accrued Certificate Interest Distribution Amount or the related Unpaid
Interest Amount, if any, then such shortfall will be allocated to the Holders
of such Class, with interest thereon, on future Distribution Dates, as an
Unpaid Interest Amount, subject to the priorities described above.
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(b) On each Distribution Date, prior to any distributions on any other
Class of Certificates, all amounts representing Prepayment Charges from the
Mortgage Loans received during the related Prepayment Period shall be
distributed by the Trustee to the holders of the Class P Certificates.
Any principal distributions allocated to the Class A Certificates
shall be allocated sequentially, first to the Class A-1 Certificates, until
their Class Certificate Balance has been reduced to zero, then to the Class
A-2 Certificates, until their Class Certificate Balance has been reduced to
zero, then to the Class A-3 Certificates, until their Class Certificate
Balance has been reduced to zero and then to the Class A-4 Certificates, until
their Class Certificate Balance has been reduced to zero. Notwithstanding the
foregoing, on and after the Distribution Date on which the aggregate Class
Certificate Balances of the Subordinated Certificates and the principal
balance of the Class X Certificates have been reduced to zero, any principal
distributions allocated to the Class A Certificates shall be allocated, pro
rata among the Class A Certificates, based on their respective Class
Certificate Balances, until their respective Class Certificate Balances have
been reduced to zero.
(c) On any Distribution Date, any Relief Act Shortfalls and Net
Prepayment Interest Shortfalls for such Distribution Date shall be allocated
by the Trustee as a reduction in the following order:
(1) First, to the amount of interest payable to the Class X
Certificates; and
(2) Second, pro rata, as a reduction of the Accrued Certificate
Interest Distribution Amount for the Class A, Class M and
Class B Certificates, based on the amount of interest to which
such Classes would otherwise be entitled.
Section 4.03 Monthly Statements to Certificateholders. (a) Not later
than each Distribution Date, the Trustee shall make available to each
Certificateholder, the Servicers, the Depositor and each Rating Agency a
statement setting forth with respect to the related distribution:
(i) the actual Distribution Date, the related Record Date, the
Interest Accrual Period(s) for each Class for such Distribution Date and
the LIBOR Determination Date for such Interest Accrual Period;
(ii) the amount of Available Funds;
(iii) the amount of Available Funds allocable to principal, the
Principal Remittance Amount (separately identifying the components
thereof) and the Principal Distribution Amount (separately identifying
the components thereof);
(iv) the amount of Available Funds allocable to interest and each
Interest Remittance Amount;
(v) the amount of any Unpaid Interest Amount for each Class included
in such distribution and any remaining Unpaid Interest Amounts after
giving effect to such
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distribution, any Basis Risk Carry Forward Amount for each Class and the
amount of such Basis Risk Carry Forward Amount covered by withdrawals
from the Excess Reserve Fund Account on such Distribution Date;
(vi) if the distribution to the Holders of such Class of Certificates
is less than the full amount that would be distributable to such Holders
if there were sufficient funds available therefor, the amount of the
shortfall and the allocation of the shortfall as between principal and
interest, including any Basis Risk Carry Forward Amount not covered by
amounts in the Excess Reserve Fund Account;
(vii) the Class Certificate Balance of each Class of Certificates
before and after giving effect to the distribution of principal on such
Distribution Date;
(viii) the Pool Stated Principal Balance for the related Distribution
Date;
(ix) the amount of Expense Fees paid to or retained by the Servicers
and the Trustee (stated separately and in the aggregate) with respect to
such Distribution Date;
(x) the Pass-Through Rate for each such Class of Certificates with
respect to such Distribution Date;
(xi) the amount of Advances included in the distribution on such
Distribution Date reported by the Servicers (and the Trustee as successor
servicer and any other successor servicer, if applicable) as of the close
of business on the Determination Date immediately preceding such
Distribution Date;
(xii) the number and aggregate outstanding principal balances of
Mortgage Loans (1) as to which the Scheduled Payment is delinquent 31 to
60 days, 61 to 90 days, 91 to 120 days, 121 to 150 days, 151 to 180 days,
181 to 210 days, 211 to 240 days and 240+ days, (2) that have become REO
Property, (3) that are in foreclosure and (4) that are in bankruptcy, in
each case as of the close of business on the last day of the related Due
Period;
(xiii) for each of the preceding 12 calendar months, or all calendar
months since the related Cut-off Date, whichever is less, the aggregate
dollar amount of the Scheduled Payments (A) due on all outstanding
Mortgage Loans on each of the Due Dates in each such month and (B)
delinquent 60 days or more on each of the Due Dates in each such month;
(xiv) with respect to any Mortgage Loans that became REO Properties
during the preceding calendar month, the aggregate number of such
Mortgage Loans and the aggregate outstanding principal balance of such
Mortgage Loans as of the close of business on the last day of the related
Due Period;
(xv) the total number and outstanding principal balance of any REO
Properties (and market value, if available) as of the close of business
on the last Business Day of the related Due Period;
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(xvi) whether a Trigger Event has occurred and is continuing
(separately identifying the components of the calculation resulting in
the existence of the Trigger Event and the aggregate outstanding balance
of all 60+ Day Delinquent Mortgage Loans);
(xvii) the amount on deposit in the Excess Reserve Fund Account (after
giving effect to distributions on such Distribution Date);
(xviii) in the aggregate and for each Class of Certificates, the
aggregate amount of Applied Realized Loss Amounts incurred during the
preceding calendar month and aggregate Applied Realized Loss Amounts
through such Distribution Date;
(xix) the amount of any Net Monthly Excess Cash Flow on such
Distribution Date and the allocation of it to the Certificateholders with
respect to Unpaid Interest Amounts, Applied Realized Loss Amounts, and
Basis Risk Carry Forward Amounts;
(xx) the amount of any Net Swap Payments, Net Swap Receipts, Swap
Termination Payments or Defaulted Swap Termination Payments;
(xxi) the calculations of LIBOR and Swap LIBOR;
(xxii) the Subordinated Amount and Specified Subordinated Amount;
(xxiii) Prepayment Charges collected or paid (pursuant to Section
3.07(a)) by the Servicers;
(xxiv) the Cumulative Loss Percentage and the aggregate amount of
Realized Losses used to calculate the Cumulative Loss Percentage;
(xxv) the amount distributed on the Class X Certificates;
(xxvi) the amount of any Subsequent Recoveries for such Distribution
Date; and
(xxvii) the number of Mortgage Loans at the beginning and end of the
applicable reporting period, the pool factor (being the Stated Principal
Balance of the Mortgage Loans for the related Distribution Date divided
by the Cut-off Date Principal Balance), and the weighted average interest
rate, and weighted average remaining term.
In addition, each Form 10-D prepared and filed by the Trustee pursuant
to Section 8.12 shall include the following information with respect to the
related distribution:
(i) material breaches of Mortgage Loan representations and warranties
under this Agreement of which the Trustee has actual knowledge or has
received written notice; and
(ii) material breaches of any covenants under this Agreement of which
the Trustee has actual knowledge or has received written notice.
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(b) The Trustee's responsibility for providing the above statement to
the Certificateholders, each Rating Agency, and the Depositor is limited, if
applicable, to the availability, timeliness and accuracy of the information
derived from the Servicers and the Responsible Parties. The Trustee shall make
available the above statement via the Trustee's internet website. The
Trustee's website will initially be located at [________] and assistance in
using the website can be obtained by calling the Trustee's investor relations
desk at [________]. Parties that are unable to use the website are entitled to
have a paper copy mailed to them via first class mail by calling the investor
relations desk and indicating such. The Trustee may change the way the monthly
statements to Certificateholders are distributed in order to make such
distribution more convenient and/or more accessible to the above parties and
the Trustee shall provide timely and adequate notification to all above
parties regarding any such changes. As a condition to access the Trustee's
internet website, the Trustee may require registration and the acceptance of a
disclaimer. The Trustee will not be liable for the dissemination of
information in accordance with this Agreement.
The Trustee shall make available to each Analytics Company, either
electronically or via the Trustee's internet website, each statement to
Certificateholders prepared pursuant to this Section 4.03(a). The Trustee (and
the Servicer, if such discrepany results from or arises out of any information
provided by the Servicer pursuant to this Agreement) shall cooperate in good
faith with the Depositor to reconcile any discrepancies in such statements,
and the Trustee shall provide any corrections to such statements to each
Analytics Company as soon as reasonably practicable after the related
Distribution Date.
The Trustee will also be entitled to rely on but shall not be
responsible for the content or accuracy of any information provided by third
parties for purposes of preparing the monthly statement to Certificateholders
and may affix thereto any disclaimer it deems appropriate in its reasonable
discretion (without suggesting liability on the part of any other party
hereto).
(c) Within a reasonable period of time after the end of each calendar
year, the Trustee shall cause to be furnished to each Person who at any time
during the calendar year was a Certificateholder, a statement containing the
information set forth in clauses (a)(i) and (a)(ii) of this Section 4.03
aggregated for such calendar year or applicable portion thereof during which
such Person was a Certificateholder. Such obligation of the Trustee shall be
deemed to have been satisfied to the extent that substantially comparable
information shall be provided by the Trustee pursuant to any requirements of
the Code as from time to time in effect.
(d) Not later than the Determination Date for each Distribution Date,
each Servicer shall furnish to the Depositor with respect to clause (i) below
and to the Trustee, the Depositor and the Responsible Party with respect to
clause (ii) below, a monthly remittance advice statement (the "Servicer
Remittance Report") (in a format mutually agreed upon by such Servicer, the
Trustee and the Depositor) containing such information as shall be reasonably
requested (i) by the Depositor and the Responsible Party to enable the
Depositor to disclose "static pool information", as required by Item 1105 of
Regulation AB, with respect to the Mortgage Loans, and (ii) by the Trustee to
enable the Trustee to provide the reports required by Section 4.03(a) as to
the accompanying remittance and the period ending on the close of business on
the last day of the related Prepayment Period.
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The Servicer Remittance Report shall, at a minimum, document, on such
Determination Date, Mortgage Loan payment activity on an individual Mortgage
Loan basis, as follows:
(i) with respect to each Scheduled Payment, the amount of such
remittance allocable to principal (including a separate breakdown of any
Principal Prepayment, including the date of such prepayment, and any
Prepayment Charges, received during the related Prepayment Period along
with a detailed report of interest on principal prepayment amounts
remitted in accordance with Section 3.25);
(ii) with respect to each Scheduled Payment, the amount of such
remittance allocable to interest;
(iii) the amount of servicing compensation received by such Servicer
during the prior distribution period;
(iv) the individual and aggregate Stated Principal Balance of the
Mortgage Loans;
(v) the aggregate expenses reimbursed to such Servicer during the
prior distribution period pursuant to Section 3.11; and
(vi) the number and aggregate outstanding principal balances of
Mortgage Loans (a) delinquent 31 to 60 days, 61 to 90 days, 91 to 120
days, 121 to 150 days, 151 to 180 days, 181 to 210 days, 211 to 240 days
and 240+ days; (b) as to which foreclosure or bankruptcy proceedings of
the related mortgagor have commenced; and (c) as to which REO Property
has been acquired.
(e) Notwithstanding anything in Section 4.03(d) to the contrary,
[_________] shall be deemed to have satisfied the requirement to timely
deliver the Servicer Remittance Report set forth in Section 4.03(d) above if
the Trustee and the Depositor receive such report on or prior to the [__] day
of the calendar month in which the related Determination Date occurs;
provided, however, that if such day is not a Business Day, [_________] shall
be deemed to have satisfied the requirement to timely deliver the Servicer
Remittance Report set forth in Section 4.03(d) above if the Trustee and the
Depositor receive such report (i) on the next Business Day succeeding such
[__] day, if such succeeding Business Day is not later than the [__] day of
such calendar month or (ii) on the Business Day immediately preceding such
[__] day, if such succeeding Business Day is later than the [__] day of such
calendar month.
(f) For all purposes of this Agreement, with respect to any Mortgage
Loan, delinquencies shall be determined and reported based on the so-called
"OTS" methodology for determining delinquencies on mortgage loans similar to
the Mortgage Loans. By way of example, a Mortgage Loan would be delinquent
with respect to a Scheduled Payment due on a Due Date if such Scheduled
Payment is not made by the close of business on the Mortgage Loan's next
succeeding Due Date, and a Mortgage Loan would be more than 30-days Delinquent
with respect to such Scheduled Payment if such Scheduled Payment were not made
by the close of business on the Mortgage Loan's second succeeding Due Date.
Each Servicer hereby represents and warrants to the Depositor that this
delinquency recognition policy is not less
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restrictive than any delinquency recognition policy established by the primary
safety and soundness regulator, if any, of such Servicer.
Section 4.04 Certain Matters Relating to the Determination of LIBOR.
LIBOR shall be calculated by the Trustee in accordance with the definition of
"LIBOR". Until all of the Offered Certificates are paid in full, the Trustee
shall at all times retain at least four Reference Banks for the purpose of
determining LIBOR with respect to each LIBOR Determination Date. The Trustee
initially shall designate the Reference Banks (after consultation with the
Depositor). Each "Reference Bank" shall be a leading bank engaged in
transactions in Eurodollar deposits in the international Eurocurrency market,
shall not control, be controlled by, or be under common control with, the
Trustee and shall have an established place of business in London. If any such
Reference Bank should be unwilling or unable to act as such or if the Trustee
should terminate its appointment as Reference Bank, the Trustee shall promptly
appoint or cause to be appointed another Reference Bank (after consultation
with the Depositor). The Trustee shall have no liability or responsibility to
any Person for (i) the selection of any Reference Bank for purposes of
determining LIBOR or (ii) any inability to retain at least four Reference
Banks which is caused by circumstances beyond its reasonable control.
The Pass-Through Rate for each Class of Offered Certificates for each
Interest Accrual Period shall be determined by the Trustee on each LIBOR
Determination Date so long as the Offered Certificates are Outstanding on the
basis of LIBOR and the respective formulae appearing in footnotes
corresponding to the Offered Certificates in the table relating to the
Certificates in the Preliminary Statement. The Trustee shall not have any
liability or responsibility to any Person for its inability, following a
good-faith reasonable effort, to obtain quotations from the Reference Banks or
to determine the arithmetic mean referred to in the definition of LIBOR, all
as provided for in this Section 4.04 and the definition of LIBOR. The
establishment of LIBOR and each Pass-Through Rate for the Offered Certificates
by the Trustee shall (in the absence of manifest error) be final, conclusive
and binding upon each Holder of a Certificate and the Trustee.
Section 4.05 Allocation of Applied Realized Loss Amounts. Any Applied
Realized Loss Amounts shall be allocated by the Trustee to the most junior
Class of Subordinated Certificates then Outstanding in reduction of the Class
Certificate Balance thereof.
Section 4.06 Swap Account. On the Closing Date, the Trustee shall
establish and maintain in its name, a separate non-interest bearing trust
account for the benefit of the holders of the Certificates (the "Swap
Account") as a part of the Trust Fund. The Swap Account shall be an Eligible
Account, and funds on deposit therein shall be held separate and apart from,
and shall not be commingled with, any other moneys, including, without
limitation, other moneys of the Trustee held pursuant to this Agreement.
On any Distribution Date, Swap Termination Payments, Net Swap Payments
owed to the Swap Provider and Net Swap Receipts for that Distribution Date
will be deposited into the Swap Account. Funds in the Swap Account will be
distributed in the following order of priority:
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(i) to the Swap Provider, all Net Swap Payments, if any, owed to the
Swap Provider for that Distribution Date;
(ii) to the Swap Provider, any Swap Termination Payment, including,
without limitation, any Senior Defaulted Swap Termination Payment but not
including any other Defaulted Swap Termination Payment owed to the Swap
Provider for that Distribution Date;
(iii) to the Class A Certificates, to pay Accrued Certificate Interest
Distribution Amounts and, if applicable, any Unpaid Interest Amounts as
described in Section 4.02(a)(i), to the extent unpaid from Available
Funds;
(iv) sequentially, to the Class ▇-▇, ▇▇▇▇▇ ▇-▇, Class M-3, Class M-4,
Class M-5, Class M-6, Class B-1, Class B-2 and Class B-3 Certificates, in
that order, to pay Accrued Certificate Interest Distribution Amounts and,
if applicable, any Unpaid Interest Amounts as described in Section
4.02(a)(i) and Section 4.02(a)(iii), to the extent unpaid from Available
Funds;
(v) to the Offered Certificates, to pay principal as described and, in
the same manner and order of priority as set forth, in Section
4.02(a)(ii)(A) or Section 4.02(a)(ii)(B), as applicable, but only to the
extent necessary to maintain the Subordinated Amount at the Specified
Subordinated Amount, after giving effect to payments and distributions
from Available Funds;
(vi) to the Class A Certificates, to pay Basis Risk Carry Forward
Amounts, pro rata, based on their Class Certificate Balances for such
Distribution Date, up to the Swap Payment Allocation for each Class of
Class A Certificates and to the extent unpaid from Available Funds
(including Basis Risk Payments on deposit in the Excess Reserve Fund
Account);
(vii) sequentially, to the Class ▇-▇, ▇▇▇▇▇ ▇-▇, Class M-3, Class M-4,
Class M-5, Class M-6, Class B-1, Class B-2 and Class B-3 Certificates, to
pay Basis Risk Carry Forward Amounts, up to the Swap Payment Allocation
for each Class of Class M and Class B Certificates and to the extent
unpaid from Available Funds (including Basis Risk Payments on deposit in
the Excess Reserve Fund Account);
(viii) to the Offered Certificates, any remaining unpaid Basis Risk
Carry Forward Amount, pro rata, based on their respective remaining
unpaid Basis Risk Carry Forward Amount after the allocation of payments
as set forth in clauses (vi) and (vii) above;
(ix) sequentially, to the Class ▇-▇, ▇▇▇▇▇ ▇-▇, Class M-3, Class M-4,
Class M-5, Class M-6, Class B-1, Class B-2 and Class B-3 Certificates, to
pay any Unpaid Realized Loss Amount, to the extent unpaid from Available
Funds;
(x) to the Swap Provider, any remaining Defaulted Swap Termination
Payment owed to the Swap Provider for that Distribution Date; and
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(xi) to the holders of the Class X Certificates, any remaining
amounts.
Upon termination of the Trust, any amounts remaining in the Swap
Account shall be distributed pursuant to the priorities set forth in this
Section 4.06.
In the event that, upon the Trust entering into a replacement interest
rate swap following the occurrence of an Additional Termination Event of the
type described in Part 1(h)(ii) of the Interest Rate Swap Agreement, the Trust
is entitled to receive a payment from a replacement swap provider, the Trustee
shall direct the replacement swap provider to make such payment to the Swap
Account. Any Senior Defaulted Swap Termination Payment shall be made from the
Swap Account to the Swap Provider immediately upon receipt of such payment,
regardless of whether the date of receipt thereof is a Distribution Date. To
the extent that any Replacement Swap Provider Payment is made to an account
other than the Swap Account, then, notwithstanding anything to the contrary
contained in this Agreement, any Senior Defaulted Swap Termination Payment
shall be paid to the Swap Provider immediately upon receipt of such
Replacement Swap Provider Payment, regardless of whether the date of receipt
thereof is a Distribution Date and without regard to anything to the contrary
contained in this Agreement. For the avoidance of doubt, the parties agree
that the Swap Provider shall have first priority to any Replacement Swap
Provider Payment over the payment by the Trust to Certificateholders, the
Servicer, any Responsible Party, the Trustee or any other Person.
The Trustee shall account for the Swap Account as an asset of a
grantor trust under subpart E, Part I of subchapter J of the Code and not as
an asset of any Trust REMIC created pursuant to this Agreement. The beneficial
owners of the Swap Account are the Class X Certificateholders. For federal
income tax purposes, Net Swap Payments and Swap Termination Payments payable
to the Swap Provider shall be deemed to be paid to the Swap Account from the
Upper-Tier REMIC, first, by the Holder of the Class X Certificates (in respect
of the Class IO Interest and, if applicable, the Class X Interest) and second,
other than any Defaulted Swap Termination Payment, from the Upper-Tier REMIC
by the Holders of the applicable Class or Classes of Offered Certificates (in
respect of Class IO Shortfalls) as and to the extent provided in Section 8.13.
Any Basis Risk Carry Forward Amounts and, without duplication,
Upper-Tier Carry Forward Amounts distributed by the Trustee to the Offered
Certificateholders shall be accounted for by the Trustee, for federal income
tax purposes, as amounts paid first to the Holders of the Class X Certificates
in respect of the Class X Interest and (to the extent remaining after payments
to the Swap Provider) the Class IO Interest, and then to the respective Class
or Classes of Offered Certificates. In addition, the Trustee shall account for
the rights of Holders of each Class of Offered Certificates to receive
payments of Upper-Tier Carry Forward Amounts (including, but without
duplication Basis Risk Carry Forward Amounts) from the Swap Account (along
with Basis Risk Carry Forward Amounts payable from the Excess Reserve Fund
Account) as rights in a separate limited recourse interest rate cap contract
written by the Class X Certificateholders in favor of Holders of each such
Class.
The Swap Account shall be an "outside reserve fund" for federal income
tax purposes and not an asset of any Trust REMIC. Furthermore, the Holders of
the Class X
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Certificates shall be the beneficial owners of the Swap Account for all
federal income tax purposes, and shall be taxable on all income earned
thereon.
With respect to the failure of the Swap Provider to perform any of its
obligations under the Interest Rate Swap Agreement, the breach by the Swap
Provider of any of its representations and warranties made pursuant to the
Interest Rate Swap Agreement, or the termination of the Interest Rate Swap
Agreement, the Trustee shall send any notices and make any demands, on behalf
of the Trust as are required under the Interest Rate Swap Agreement. To the
extent that the Swap Provider fails to make any payment required under terms
of the Interest Rate Swap Agreement, the Trustee shall immediately demand that
▇▇▇▇▇▇ ▇▇▇▇▇▇▇, the guarantor of the Swap Provider's obligations under the
guarantee of ▇▇▇▇▇▇ ▇▇▇▇▇▇▇ relating to the Interest Rate Swap Agreement, make
any and all payments then required to be made by ▇▇▇▇▇▇ ▇▇▇▇▇▇▇ pursuant to
such guarantee. The Trustee shall cause any replacement swap provider to
provide a copy of the related replacement interest rate swap agreement to the
Trustee and the Depositor.
ARTICLE V
THE CERTIFICATES
Section 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) and aggregate denominations per Class set forth in the
Preliminary Statement.
The Depositor hereby directs the Trustee to register the Class X and
Class P Certificates in the name of the Depositor or its designee. On a date
as to which the Depositor notifies the Trustee, the Trustee shall transfer the
Class X and Class P Certificates in the name of the NIM Trustee, or such other
name or names as the Depositor shall request, and to deliver the Class X and
Class P Certificates to the NIM Trustee or to such other Person or Persons as
the Depositor shall request.
Subject to Section 9.02 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, if such Holder
has so notified the Trustee at least five Business Days prior to the related
Record Date or (y) by check mailed by first class mail to such
Certificateholder at the address of such Holder appearing in the Certificate
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 authentication 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 authenticated by the Trustee by
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manual signature, and such authentication 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 authentication. On the Closing Date, the Trustee shall
authenticate the Certificates to be issued at the direction of the Depositor,
or any Affiliate thereof.
Section 5.02 Certificate 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 Certificate
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 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.
No service charge to the Certificateholders shall be made for any
registration of transfer or exchange of Certificates, but 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 may be required.
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
determining whether a transfer is being made pursuant to an effective
registration statement, the Trustee shall be entitled to rely solely upon a
written notice to such effect from the Depositor. Except with respect to (i)
the transfer of the Class X, Class P or Class R Certificates to the Depositor
or an Affiliate of the Depositor, (ii) the transfer of the Class X or Class P
Certificates to the NIM Issuer or the NIM Trustee, or (iii) a transfer of the
Class X or Class P Certificates from the NIM Issuer or the NIM Trustee to the
Depositor or an Affiliate of the Depositor, in the event that a transfer of a
Private Certificate which is a Physical 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
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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) there
shall be delivered to the Trustee at the expense of the transferor an Opinion
of Counsel 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
Physical 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 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, the Depositor and each Servicer against any liability
that may result if the transfer is not so exempt or is not made in accordance
with such federal and state laws.
Except with respect to (i) the transfer of the Class R, Class X or
Class P Certificates to the Depositor or an Affiliate of the Depositor, (ii)
the transfer of the Class X or Class P Certificates to the NIM Issuer or the
NIM Trustee, or (iii) a transfer of the Class X or Class P Certificates from
the NIM Issuer or the NIM Trustee to the Depositor or an Affiliate of the
Depositor, 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 to Section 406 of ERISA, a
plan subject to Section 4975 of the Code or a plan subject to any Federal,
state or local law ("Similar Law") materially similar to the foregoing
provisions of ERISA or 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, or (ii) in the case of an ERISA-Restricted Certificate
other than a Residual Certificate or a 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 purchase and
holding of such Certificates are covered under Sections I and III of PTCE
95-60 or (iii) in the case of any such ERISA-Restricted Certificate other than
a Residual Certificate or Class P Certificate presented for registration in
the name of an employee benefit plan subject to Title I of ERISA, a plan or
arrangement subject to Section 4975 of the Code (or comparable provisions of
any subsequent
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enactments), or a plan subject to Similar Law, 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, which Opinion of Counsel shall not be an expense of the Servicers,
the Depositor, the Trustee or the Trust Fund, addressed to the Trustee, to the
effect that the purchase or holding of such ERISA-Restricted Certificate will
not constitute or result in a non-exempt prohibited transaction within the
meaning of ERISA, Section 4975 of the Code or any Similar Law and will not
subject the Depositor, 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 Private Certificate or a 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. Notwithstanding anything else to the
contrary herein, (a) any purported transfer of an ERISA-Restricted
Certificate, other than a Class P Certificate or Residual Certificate, to or
on behalf of an employee benefit plan subject to ERISA, the Code or Similar
Law without the delivery to the Trustee of an Opinion of Counsel satisfactory
to the Trustee as described above shall be void and of no effect and (b) any
purported transfer of a Class P Certificate or Residual Certificate to a
transferee that does not make the representation in clause (i) above shall be
void and of no effect.
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.
As long as the Interest Rate Swap Agreement is in effect, each
beneficial owner of a Certificate other than an ERISA-Restricted Certificate,
or any interest therein, shall be deemed to have represented that either (i)
it is not a Plan or (ii) the acquisition and holding of the Certificate are
eligible for the exemptive relief available under at least one of the
Investor-Based Exemptions.
(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
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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 a
Non-Permitted Transferee;
(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 not have any
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 a Non-Permitted Transferee at the time it became a Holder or,
at such subsequent time as it became a Non-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 a Non-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, which
Opinion of Counsel shall not be an expense of the Trust Fund or the Trustee,
to the effect that the elimination of such restrictions will not cause any
Trust REMIC hereunder 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
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 a
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Non-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 a Non-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.
(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 Certificate 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 Certificate 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 Certificate Owners.
All transfers by Certificate Owners of Book-Entry Certificates shall
be made in accordance with the procedures established by the Depository
Participant or brokerage firm representing such Certificate Owner. Each
Depository Participant shall only transfer Book-Entry Certificates of
Certificate Owners it represents or of brokerage firms for which it acts as
agent in accordance with the Depository's normal procedures.
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 Trustee or the Depositor is
unable to locate a qualified successor, or (y) the Depositor notifies the
Depository (and the Trustee consents) of its intent to terminate the
book-entry system through the Depository and, upon receipt of notice of such
intent from the Depository, the Depository Participants holding beneficial
interests in the Book-Entry Certificates agree to initiate such termination,
the Trustee shall notify all Certificate Owners, through the Depository, of
the occurrence of any such event and of the availability of definitive, fully
registered Certificates (the "Definitive Certificates") to Certificate 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. None of the Servicers, the Depositor or 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
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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.
(f) Each Private Certificate presented or surrendered for registration
of transfer or exchange shall be accompanied by a written instrument of
transfer and accompanied by IRS Form W-8ECI, W-8BEN, W-8IMY (and all
appropriate attachments) or W-9 in form satisfactory to the Trustee, duly
executed by the Certificateholder or his attorney duly authorized in writing.
Each Certificate presented or surrendered for registration of transfer or
exchange shall be canceled and subsequently disposed of by the Trustee in
accordance with its customary practice. No service charge shall be made for
any registration of transfer or exchange of Private Certificates, but the
Trustee may require payment of a sum sufficient to cover any tax or
governmental charge that may be imposed in connection with any transfer or
exchange of Private Certificates.
Section 5.03 Mutilated, 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 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.
Section 5.04 Persons Deemed Owners. The Servicers, the Trustee, the
Depositor and any agent of a Servicer, 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 none of the Servicers,
the Trustee, the Depositor, or any agent of a Servicer, the Depositor or the
Trustee shall be affected by any notice to the contrary.
Section 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 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, such Servicer or the Certificateholders
at such recipients' expense the most recent list of the Certificateholders of
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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.
Section 5.06 Maintenance of Office or Agency. The Trustee will
maintain or cause to be maintained at its expense an office or offices or
agency or agencies in the United States where Certificates may be surrendered
for registration of transfer or exchange. The Trustee initially designates the
offices of its agent located at [ADDRESS] for such purposes. The Trustee shall
give prompt written notice to the Certificateholders of any change in such
location of any such office or agency.
ARTICLE VI
THE DEPOSITOR AND THE SERVICERS
Section 6.01 Respective Liabilities of the Depositor and the
Servicers. The Depositor and each of the Servicers shall each be liable in
accordance herewith only to the extent of the obligations specifically and
respectively imposed upon and undertaken by them herein.
Section 6.02 Merger or Consolidation of the Depositor or a Servicer.
(a) The Depositor and each of the Servicers will each keep in full effect its
existence, rights and franchises as a corporation or federally chartered
savings bank, as the case may be, under the laws of the United States or under
the laws of one of the states thereof and will each 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 this Agreement, or any of the Mortgage Loans and to perform
its respective duties under this Agreement.
(b) Any Person into which the Depositor or a Servicer may be merged or
consolidated, or any Person resulting from any merger or consolidation to
which the Depositor or a Servicer shall be a party, or any person succeeding
to the business of the Depositor or a Servicer, shall be the successor of the
Depositor or such Servicer, as the case may be, hereunder, without the
execution or filing of any paper or any further act on the part of any of the
parties hereto, anything herein to the contrary notwithstanding; provided,
however, that the successor or surviving Person to such Servicer shall be
qualified to service mortgage loans on behalf of, ▇▇▇▇▇▇ ▇▇▇ or ▇▇▇▇▇▇▇ Mac.
As a condition to the succession to any Servicer under this Agreement by any
Person (i) into which a Servicer may be merged or consolidated, or (ii) which
may be appointed as a successor to a Servicer, such Servicer shall provide to
the Depositor, at least 15 calendar days prior to the effective date of such
succession or appointment, (x) written notice to the Depositor of such
succession or appointment and (y) in writing and in form and substance
reasonably satisfactory to the Depositor, all information reasonably necessary
to enable the Trustee, pursuant to Section 8.12(g), to accurately and timely
report the event under Item 6.02 of Form 8-K pursuant to the Exchange Act (if
such reports under the Exchange Act are then required to be filed under the
Exchange Act).
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Section 6.03 Limitation on Liability of the Depositor, the Servicers
and Others. Neither the Depositor, the Servicers nor any of their respective
directors, officers, employees or agents shall be under any liability to the
Certificateholders for any action taken or for refraining from the taking of
any action in good faith pursuant to this Agreement, or for errors in
judgment; provided, however, that this provision shall not protect the
Depositor, the Servicers or any such Person against any breach of
representations or warranties made by it herein or protect the Depositor, the
Servicers or any such Person from any liability which would otherwise be
imposed by reasons of willful misfeasance, bad faith or negligence (or gross
negligence in the case of the Depositor) in the performance of duties or by
reason of reckless disregard of obligations and duties hereunder. The
Depositor, each Servicer and any director, officer, employee or agent of the
Depositor and each Servicer may rely in good faith on any document of any kind
prima facie properly executed and submitted by any Person respecting any
matters arising hereunder. The Depositor and its Affiliates, the Sponsor, each
Servicer and any director, officer, employee or agent of the Depositor, the
Sponsor or each Servicer shall be indemnified by the Trust Fund and held
harmless against any loss, liability or expense incurred in connection with
any audit, controversy or judicial proceeding relating to a governmental
taxing authority or any legal action relating to this Agreement or the
Certificates other than any loss, liability or expense related to any specific
Mortgage Loan or Mortgage Loans (except as any such loss, liability or expense
shall be otherwise reimbursable pursuant to this Agreement) and any loss,
liability or expense incurred by reason of willful misfeasance, bad faith or
negligence (or gross negligence in the case of the Depositor) in the
performance of duties hereunder or by reason of reckless disregard of
obligations and duties hereunder. Neither the Depositor nor any Servicer shall
be under any obligation to appear in, prosecute or defend any legal action
that is not incidental to its respective duties hereunder and which in its
opinion may involve it in any expense or liability; provided, however, that
each of the Depositor and each Servicer may in its discretion undertake any
such action (or direct the Trustee to undertake such actions pursuant to
Section 2.03 for the benefit of the Certificateholders) that it may deem
necessary or desirable in respect of this Agreement and the rights and duties
of the parties hereto and interests of the Trustee and the Certificateholders
hereunder. In such event, the legal expenses and costs of such action and any
liability resulting therefrom shall be expenses, costs and liabilities of the
Trust Fund, and the Depositor and the applicable Servicer shall be entitled to
be reimbursed therefor out of the applicable Collection Account.
Section 6.04 Limitation on Resignation of a Servicer. Subject to
Sections 7.01 and 10.07, no Servicer shall assign this Agreement or resign
from the obligations and duties hereby imposed on it except by mutual consent
of the Servicers, the Depositor and the Trustee or upon the determination that
its duties hereunder are no longer permissible under applicable law and such
incapacity cannot be cured by such Servicer. Any such determination permitting
the resignation of a Servicer shall be evidenced by an Opinion of Counsel to
such effect delivered to the Depositor and the Trustee which Opinion of
Counsel shall be in form and substance acceptable to the Depositor and the
Trustee. No such resignation shall become effective until a successor shall
have assumed such Servicer's responsibilities and obligations hereunder.
Notwithstanding the provisions of Section 6.04 herein to the contrary,
in the event that a Servicer determines that it will no longer engage in the
business of servicing mortgage loans, such Servicer may assign its rights
under this Agreement, provided that, (i) the Depositor in its sole discretion
has consented, which consent shall not be unreasonably withheld, (ii) the
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Rating Agencies' ratings of the Certificates in effect immediately prior to
such action will not be qualified, reduced or withdrawn as a result thereof
(as evidenced by a letter to such effect from the Rating Agencies) and (iii)
such Servicer shall be liable for all costs and expenses associated with the
transfer of servicing, provided, further, that such Servicer shall indemnify
and hold each of the Trust Fund, the Trustee, the Depositor, the other
Servicers hereunder, any sub-servicer, the successor servicer and each
Certificateholder harmless against any and all claims, losses, penalties,
fines, forfeitures, reasonable legal fees and related costs, judgments, and
any other costs, fees and expenses that such party may sustain in any way
related to such assignment except with respect to a successor servicer's
failure to comply with the terms of this Agreement. No assignment by such
Servicer shall become effective until a successor servicer acceptable to the
Depositor and the Trustee shall have assumed in writing such Servicer's
responsibilities, duties, liabilities (other than those liabilities arising
prior to the appointment of such successor) and obligations under this
Agreement. Any such assignment shall not relieve the applicable Servicer of
responsibility for any of the obligations specified herein except to the
extent that such responsibilities have been expressly assumed by the successor
servicer.
Section 6.05 Additional Indemnification by the Servicers; Third Party
Claims. (a) Each Servicer, severally and not jointly, shall indemnify the
Responsible Party, the Depositor, the Sponsor and the Trustee and any
director, officer, employee or agent of the Depositor, the Sponsor or the
Trustee and hold them harmless against any and all claims, losses, damages,
penalties, fines, forfeitures, reasonable and necessary legal fees and related
costs, judgments, and any other costs, fees and expenses that any of them may
sustain in any way related to (i) any breach by such Servicer of any of its
representations and warranties referred to in Section 2.03(a), (ii) any error
in any tax or information return prepared by such Servicer or (iii) the
failure of such Servicer to perform its duties and service the Mortgage Loans
in compliance with the terms of this Agreement (including, without limitation,
the failure to deliver accurate and complete information on a timely basis
pursuant to Section 4.03(d)). The applicable Servicer immediately shall notify
the Depositor and the Trustee if such claim is made by a third party with
respect to this Agreement or the Mortgage Loans, assume (with the prior
written consent of the Depositor and the Trustee) the defense of any such
claim and pay all expenses in connection therewith, including reasonable
counsel fees, and promptly pay, discharge and satisfy any judgment or decree
which may be entered against it or the Depositor, the Responsible Party or the
Trustee in respect of such claim.
(b) Notwithstanding anything to the contrary contained in this
Agreement, each Servicer shall indemnify the Depositor, the Sponsor, the
Trustee and any director, officer, employee or agent of the Depositor, the
Sponsor or the Trustee and hold them harmless against any and all claims,
losses, damages, penalties, fines, forfeitures, reasonable and necessary legal
fees and related costs, judgments, and any other costs, fees and expenses that
any of them may sustain in any way related to any failure by such Servicer or
any Subservicer engaged by such Servicer or any Subcontractor utilized by such
Servicer to deliver any information, report, certification or accountants'
letter when and as required under Sections 3.22, 3.23, 6.02 or 8.12, including
without limitation any failure by such Servicer to identify pursuant to
Section 3.02(e) any Subcontractor "participating in the servicing function"
within the meaning of Item 1122 of Regulation AB.
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(c) If the indemnification provided for in this Section 6.05 is
unavailable or insufficient to hold harmless any Person entitled to
indemnification thereunder, then such Servicer shall contribute to the amount
paid or payable by the Person entitled to indemnification as a result of the
losses, claims, damages or liabilities of such Person in such proportion as is
appropriate to reflect the relative fault of such Person on the one hand and
such Servicer, on the other, in connection with the Servicer's obligations
pursuant to this Section 6.05. This Section 6.05 shall survive the termination
of this Agreement or the earlier resignation or removal of each Servicer.
ARTICLE VII
DEFAULT
Section 7.01 Events of Default."Event of Default" wherever used
herein, means, with respect to each Servicer individually, any one of the
following events:
(a) any failure by a Servicer to remit to the Trustee any payment
required to be made under the terms of this Agreement which continues
unremedied for a period of one Business Day after the date upon which written
notice of such failure, requiring the same to be remedied, shall have been
given to such Servicer by the Depositor or by the Trustee, or to such
Servicer, the Depositor and the Trustee by Certificateholders entitled to at
least [__]% of the Voting Rights in the Certificates; or
(b) any failure on the part of a Servicer duly to observe or perform
in any material respect any other of the covenants or agreements on the part
of such Servicer set forth in this Agreement which continues unremedied for a
period of sixty (60) days (except that (x) such number of days shall be
fifteen in the case of a failure to pay any premium for any insurance policy
required to be maintained under this Agreement and (y) such number of days
shall be ten in the case of a failure to observe or perform any of the
obligations set forth in Sections 3.02, 3.22, 3.23, 6.02 or 8.12), after the
earlier of (i) the date on which written notice of such failure, requiring the
same to be remedied, shall have been given to such Servicer by the Depositor
or by the Trustee, or to such Servicer, the Depositor and the Trustee by
Certificateholders entitled to at least [__]% of the Voting Rights in the
Certificates and (ii) actual knowledge of such failure by a Servicing Officer
of such Servicer; or
(c) a decree or order of a court or agency or supervisory authority
having jurisdiction for the appointment of a conservator or receiver or
liquidator in any insolvency, bankruptcy, readjustment of debt, marshalling of
assets and liabilities or similar proceedings, or for the winding-up or
liquidation of its affairs, shall have been entered against a Servicer and
such decree or order shall have remained in force undischarged or unstayed for
a period of sixty days; or
(d) a Servicer shall consent to the appointment of a conservator or
receiver or liquidator in any insolvency, bankruptcy, readjustment of debt,
marshalling of assets and liabilities or similar proceedings of or relating to
a Servicer or of or relating to all or substantially all of its property; or
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(e) a Servicer shall admit in writing its inability to pay its debts
generally as they become due, file a petition to take advantage of any
applicable insolvency or reorganization statute, make an assignment for the
benefit of its creditors, or voluntarily suspend payment of its obligations;
or
(f) a breach of any representation and warranty of a Servicer referred
to in Section 2.03(a), which materially and adversely affects the interests of
the Certificateholders and which continues unremedied for a period of thirty
days after the date upon which written notice of such breach is given to such
Servicer by the Trustee or by the Depositor, or to such Servicer, the Trustee
and the Depositor by Certificateholders entitled to at least [__]% of the
Voting Rights in the Certificates; or
(g) either (i) with respect to [SERVICER] or [SERVICER], any
withdrawal or downgrade of two or more levels (i.e., from "Above Average" to
"Below Average" or the equivalent) of the servicer rating, as of the Closing
Date, of such Servicer by any Rating Agency which results in a downgrade,
qualification or withdrawal of the rating assigned to any Class of
Certificates by any Rating Agency or (ii) with respect to [_______], Fitch
reduces its servicer rating of [_______] to "RPS2-" or lower, ▇▇▇▇▇'▇ reduces
its servicer rating of [_______] to "SQ3" or lower, or S&P reduces its
servicer rating of [_______] to "Average" or lower.
If an Event of Default described in clauses (a) through (g) of this
Section 7.01 shall occur, then, and in each and every such case, so long as
such Event of Default shall not have been remedied, the Trustee may, and at
the written direction of [___] of the Voting Rights, the Trustee shall, by
notice in writing to the applicable Servicer (with a copy to each Rating
Agency), terminate all of the rights and obligations of such Servicer under
this Agreement and in and to the Mortgage Loans serviced by such Servicer and
the proceeds thereof, other than its rights as a Certificateholder hereunder;
provided, however, that the Trustee shall not be required to give written
notice to such Servicer of the occurrence of an Event of Default described in
clauses (b) through (g) of this Section 7.01 unless and until a Responsible
Officer of the Trustee has actual knowledge of the occurrence of such an
event. In the event that a Responsible Officer of the Trustee has actual
knowledge of the occurrence of an event of default described in clause (a) of
this Section 7.01, the Trustee shall give written notice to the applicable
Servicer of the occurrence of such an event within one Business Day of the
first day on which such Responsible Officer obtains actual knowledge of such
occurrence; provided, that if such failure is the failure to make a P&I
Advance, the Trustee shall send such notice prior to 12:00 noon, New York
time, on the Distribution Date and, if the Event of Default of such Servicer
was the failure to make a P&I Advance, the Trustee, as successor servicer,
shall make such P&I Advance on the Distribution Date that such notice was
delivered. On and after the receipt by such Servicer of such written notice,
all authority and power of such Servicer hereunder, whether with respect to
the Mortgage Loans or otherwise, shall pass to and be vested in the Trustee.
Subject to Section 7.02, the Trustee is hereby authorized and empowered to
execute and deliver, on behalf of such Servicer, as attorney-in-fact or
otherwise, any and all documents and other instruments, and to do or
accomplish all other acts or things necessary or appropriate to effect the
purposes of such notice of termination, whether to complete the transfer and
endorsement or assignment of the Mortgage Loans and related documents, or
otherwise. Unless expressly provided in such written notice, no such
termination shall affect any obligation of such Servicer to pay amounts owed
pursuant to Article VIII. Such Servicer agrees to cooperate with the Trustee
in effecting
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the termination of such Servicer's responsibilities and rights hereunder,
including, without limitation, the transfer to the Trustee of all cash amounts
which shall at the time be credited to the Collection Account of such
predecessor servicer, or thereafter be received with respect to the Mortgage
Loans.
Notwithstanding any termination of the activities of a Servicer
hereunder, such Servicer shall be entitled to receive from the Trust Fund,
prior to transfer of its servicing obligations hereunder, payment of all
accrued and unpaid Servicing Fees and reimbursement for all outstanding P&I
Advances and Servicing Advances.
Section 7.02 Trustee to Act; Appointment of Successor. On and after
the time a Servicer receives a notice of termination pursuant to Section 3.24
or Section 7.01, the Trustee shall, subject to and to the extent provided in
Section 3.05, be the successor to such servicer in its capacity as servicer
under this Agreement and the transactions set forth or provided for herein and
shall be subject to all the responsibilities, duties and liabilities relating
thereto placed on such Servicer by the terms and provisions hereof and
applicable law including the obligation to make P&I Advances or Servicing
Advances pursuant to Section 3.24 or Section 7.01. As compensation therefor,
the Trustee shall be entitled to all funds relating to the Mortgage Loans that
such Servicer would have been entitled to charge to its Collection Account if
such Servicer had continued to act hereunder including, if such Servicer was
receiving the Servicing Fee, the Servicing Fee and the income on investments
or gain related to its Collection Account and the Distribution Account which
such Servicer would be entitled to receive (in addition to income on
investments or gain related to the Distribution Account for the benefit of the
Trustee during the Trustee Float Period). Notwithstanding the foregoing, if
the Trustee has become the successor to such servicer in accordance with
Section 7.01, the Trustee may, if it shall be unwilling to so act, or shall,
if it is prohibited by applicable law from making P&I Advances and Servicing
Advances pursuant to Section 4.01, if it is otherwise unable to so act or at
the written request of Certificateholders entitled to at least [___] of the
Voting Rights, appoint, or petition a court of competent jurisdiction to
appoint, any established mortgage loan servicing institution the appointment
of which does not adversely affect the then current rating of the Certificates
by each Rating Agency, as the successor to such servicer hereunder in the
assumption of all or any part of the responsibilities, duties or liabilities
of such servicer hereunder. Any successor to such servicer shall be an
institution which is a ▇▇▇▇▇▇ Mae and ▇▇▇▇▇▇▇ Mac approved servicer in good
standing, which has a net worth of at least $[__], which is willing to service
the Mortgage Loans and which executes and delivers to the Depositor and the
Trustee an agreement accepting such delegation and assignment, containing an
assumption by such Person of the rights, powers, duties, responsibilities,
obligations and liabilities of such terminated servicer (other than
liabilities of such terminated servicer under Section 6.03 incurred prior to
termination of such Servicer under Section 7.01), with like effect as if
originally named as a party to this Agreement; provided, that each Rating
Agency acknowledges that its rating of the Certificates in effect immediately
prior to such assignment and delegation will not be qualified or reduced, as a
result of such assignment and delegation. Pending appointment of a successor
to a servicer hereunder, the Trustee, unless the Trustee is prohibited by law
from so acting, shall, subject to Section 3.05, act in such capacity as
hereinabove provided. In connection with such appointment and assumption, the
Trustee may make such arrangements for the compensation of such successor out
of payments on Mortgage Loans as it and such successor shall agree; provided,
however, that no such compensation shall be in excess of the Servicing Fee
Rate and amounts paid to the
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predecessor servicer from investments. The Trustee and such successor shall
take such action, consistent with this Agreement, as shall be necessary to
effectuate any such succession. Neither the Trustee nor any other successor
servicer shall be deemed to be in default hereunder by reason of any failure
to make, or any delay in making, any distribution hereunder or any portion
thereof or any failure to perform, or any delay in performing, any duties or
responsibilities hereunder, in either case caused by the failure of the
predecessor servicer to deliver or provide, or any delay in delivering or
providing, any cash, information, documents or records to it.
In the event that a Servicer is terminated pursuant to Section 7.01,
such terminated Servicer shall be responsible for the servicing transfer,
provide notices to the Mortgagors, arrange for and transfer the Servicing
Files to a successor servicer, pay all of its own out-of-pocket costs and
expenses at its own expense and pay all costs and expenses of all other
parties hereto relating to the transfer of the related Servicing Files to a
successor servicer (excluding set-up costs and other administrative expenses
of the successor servicer), and in all other cases the successor servicer
shall pay for such costs and expenses but shall not be entitled to
reimbursement therefor from the Trust Fund. Such amounts payable by the
terminated Servicer shall be paid by the terminated Servicer promptly upon
presentation of reasonable documentation of such costs. If the Trustee is the
predecessor servicer (except in the case where the Trustee in its role as
successor servicer is being terminated pursuant to Section 7.01 by reason of
an Event of Default caused solely by the Trustee as the successor servicer and
not by the predecessor servicer's actions or omissions), such costs shall be
paid by the prior terminated Servicer promptly upon presentation of reasonable
documentation of such costs.
Any successor to a Servicer as servicer shall give notice to the
Mortgagors of such change of servicer and shall, during the term of its
service as servicer, maintain in force the policy or policies that each
Servicer is required to maintain pursuant to Section 3.13.
Section 7.03 Notification to Certificateholders. (a) Upon any
termination of or appointment of a successor to a Servicer, the Trustee shall
give prompt written notice thereof to Certificateholders and to each Rating
Agency.
(a) Within 60 days after the occurrence of any Event of Default, the
Trustee shall transmit by mail to all Certificateholders and each Rating
Agency notice of each such Event of Default hereunder known to the Trustee,
unless such event shall have been cured or waived.
ARTICLE VIII
CONCERNING THE TRUSTEE
Section 8.01 Duties of the Trustee. The Trustee, before the occurrence
of an Event of Default and after the curing of all Events of Default that may
have occurred, shall undertake to perform such duties and only such duties as
are specifically set forth in this Agreement. In case an Event of Default has
occurred and remains uncured, the Trustee shall exercise such of the rights
and powers vested in it by this Agreement, and use the same degree of care and
skill in their exercise as a prudent person would exercise or use under the
circumstances in the conduct of such person's own affairs.
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The Trustee, upon receipt of all resolutions, certificates,
statements, opinions, reports, documents, orders or other instruments
furnished to the Trustee that are specifically required to be furnished
pursuant to any provision of this Agreement shall examine them to determine
whether they are in the form required by this Agreement. The Trustee shall not
be responsible for the accuracy or content of any resolution, certificate,
statement, opinion, report, document, order, or other instrument.
No provision of this Agreement shall be construed to relieve the
Trustee from liability for its own negligent action, its own negligent failure
to act or its own willful misconduct.
Unless an Event of Default known to the Trustee has occurred and is
continuing:
(a) 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 the duties and obligations specifically
set forth in this Agreement, no implied covenants or obligations shall be read
into this Agreement against the Trustee, and 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 on their face to the requirements of this Agreement which it
believed in good faith to be genuine and to have been duly executed by the
proper authorities respecting any matters arising hereunder;
(b) the Trustee shall not be liable for an error of judgment made in
good faith by a Responsible Officer or Responsible Officers of the Trustee,
unless it is finally proven that the Trustee was negligent in ascertaining the
pertinent facts; and
(c) the Trustee shall not be liable with respect to any action taken,
suffered, or omitted to be taken by it in good faith in accordance with the
direction of the Holders of Certificates evidencing not less than [__]% of the
Voting Rights of Certificates 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.
(d) The Trustee shall be permitted to utilize one or more
Subcontractors for the performance of certain of its obligations under this
Agreement, provided that the Trustee complies with Section 3.02(e) as if the
Trustee were a "Servicer" pursuant to that Section. The Trustee shall
indemnify the Depositor, the Sponsor and any director, officer, employee or
agent of the Depositor or the Sponsor and hold them harmless against any and
all claims, losses, damages, penalties, fines, forfeitures, reasonable and
necessary legal fees and related costs, judgments, and any other costs, fees
and expenses that any of them may sustain in any way related to the failure of
the Trustee to perform any of its obligations under Section 3.22 or Section
3.23, including without limitation any failure by the Trustee to identify
pursuant to Section 3.02(e) any Subcontractor that is a Servicing Function
Participant. This indemnity shall survive the termination of this Agreement or
the earlier resignation or removal of the Trustee.
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Section 8.02 Certain Matters Affecting the Trustee. Except as
otherwise provided in Section 8.01:
(a) the Trustee may request and rely upon and shall be protected in
acting or refraining from acting upon any resolution, Officer's Certificate,
certificate of auditors or any other certificate, statement, instrument,
opinion, report, notice, request, consent, order, appraisal, bond or other
paper or document believed by it to be genuine and to have been signed or
presented by the proper party or parties and the Trustee shall have no
responsibility to ascertain or confirm the genuineness of any signature of any
such party or parties;
(b) the Trustee may consult with counsel, financial advisers or
accountants and the advice of any such counsel, financial advisers or
accountants and any Opinion of Counsel shall be full and complete
authorization and protection in respect of any action taken or suffered or
omitted by it hereunder in good faith and in accordance with such Opinion of
Counsel;
(c) the Trustee shall not be liable for any action taken, suffered or
omitted by it in good faith and believed by it to be authorized or within the
discretion or rights or powers conferred upon it by this Agreement;
(d) the Trustee shall not be bound to make any investigation into the
facts or matters stated in any resolution, certificate, statement, instrument,
opinion, report, notice, request, consent, order, approval, bond or other
paper or document, unless requested in writing to do so by the Holders of
Certificates evidencing not less than [__]% of the Voting Rights allocated to
each Class of Certificates;
(e) the Trustee may execute any of the trusts or powers hereunder or
perform any duties hereunder either directly or by or through agents,
accountants or attorneys and the Trustee shall not be responsible for any
misconduct or negligence on the part of any agents, accountants or attorneys
appointed with due care by it hereunder;
(f) the Trustee shall not be required to risk or expend its own funds
or otherwise incur any financial liability in the performance of any of its
duties or in the exercise of any of its rights or powers hereunder if it shall
have reasonable grounds for believing that repayment of such funds or adequate
indemnity against such risk or liability is not assured to it;
(g) the Trustee shall not be liable for any loss on any investment of
funds pursuant to this Agreement (other than as issuer of the investment
security and with respect to the investment of funds in the Distribution
Account during the Trustee Float Period);
(h) unless a Responsible Officer of the Trustee has actual knowledge
of the occurrence of an Event of Default, the Trustee shall not be deemed to
have knowledge of an Event of Default, until a Responsible Officer of the
Trustee shall have received written notice thereof; and
(i) the Trustee shall be under no obligation to exercise any of the
trusts, rights or powers vested in it by this Agreement or to institute,
conduct or defend any litigation hereunder or in relation hereto at the
request, order or direction of any of the Certificateholders,
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pursuant to this Agreement, unless such Certificateholders shall have offered
to the Trustee reasonable security or indemnity satisfactory to the Trustee
against the costs, expenses and liabilities which may be incurred therein or
thereby.
Section 8.03 Trustee Not Liable for Certificates or Mortgage Loans.
The recitals contained herein and in the Certificates shall be taken as the
statements of the Depositor and the Trustee assumes no responsibility for
their correctness. The Trustee makes no representations as to the validity or
sufficiency of this Agreement, the Interest Rate Swap Agreement or of the
Certificates or of any Mortgage Loan or related document other than with
respect to the Trustee's execution and authentication of the Certificates. The
Trustee shall not be accountable for the use or application by the Depositor
or a Servicer of any funds paid to the Depositor or a Servicer in respect of
the Mortgage Loans or deposited in or withdrawn from any Collection Account or
the Distribution Account by the Depositor or a Servicer.
The Trustee shall have no responsibility for filing or recording any
financing or continuation statement in any public office at any time or to
otherwise perfect or maintain the perfection of any security interest or lien
granted to it hereunder (unless the Trustee shall have become the successor
servicer).
The Trustee executes the Interest Rate Swap Agreement and the
Certificates not in its individual capacity but solely as Trustee of the Trust
Fund created by this Agreement, in the exercise of the powers and authority
conferred and vested in it by this Agreement. Each of the undertakings and
agreements made on the part of the Trustee on behalf of the Trust Fund in the
Interest Rate Swap Agreement and the Certificates is made and intended not as
a personal undertaking or agreement by the Trustee but is made and intended
for the purpose of binding only the Trust Fund.
Section 8.04 Trustee May Own Certificates. The Trustee in its
individual or any other capacity may become the owner or pledgee of
Certificates with the same rights as it would have if it were not the Trustee.
Section 8.05 Trustee's Fees and Expenses. As compensation for its
activities under this Agreement, the Trustee may withdraw from the
Distribution Account on each Distribution Date the Trustee Fee for the
Distribution Date and any interest or investment income earned on funds
deposited in the Distribution Account during the Trustee Float Period. The
Trustee and any director, officer, employee, or agent of the Trustee shall be
indemnified by the Trust Fund against any loss, liability, or expense
(including reasonable attorney's fees) resulting from any error in any tax or
information return prepared by any Servicer or incurred in connection with any
claim or legal action relating to (a) this Agreement, (b) the Certificates or
the Interest Rate Swap Agreement, or (c) the performance of any of the
Trustee's duties under this Agreement, the Certificates or the Interest Rate
Swap Agreement, other than any loss, liability, or expense (i) resulting from
any breach of any Servicer's obligations in connection with this Agreement for
which the related Servicer has performed its obligation to indemnify the
Trustee pursuant to Section 6.05, (ii) resulting from any breach of any
Responsible Party's obligations in connection with this Agreement for which
the related Responsible Party has performed its obligations to indemnify the
Trustee pursuant to Section 2.03(j) or (iii) incurred because of willful
misconduct, bad faith, or negligence in the performance of any of the
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Trustee's duties under this Agreement. This indemnity shall survive the
termination of this Agreement or the resignation or removal of the Trustee
under this Agreement. Without limiting the foregoing, except as otherwise
agreed upon in writing by the Depositor and the Trustee, and except for any
expense, disbursement, or advance arising from the Trustee's negligence, bad
faith, or willful misconduct, the Trust Fund shall pay or reimburse the
Trustee, for all reasonable expenses, disbursements, and advances incurred or
made by the Trustee in accordance with this Agreement with respect to:
(A) the reasonable compensation, expenses, and disbursements
of its counsel not associated with the closing of the issuance of the
Certificates, and
(B) the reasonable compensation, expenses, and disbursements
of any accountant, engineer, or appraiser that is not regularly
employed by the Trustee, to the extent that the Trustee must engage
them to perform services under this Agreement.
Except as otherwise provided in this Agreement or a separate letter
agreement between the Trustee and the Depositor, the Trustee shall not be
entitled to payment or reimbursement for any routine ongoing expenses incurred
by the Trustee in the ordinary course of its duties as Trustee under this
Agreement or for any other expenses incurred by the Trustee; provided,
however, that no expense shall be reimbursed by the Trust Fund under this
Agreement if it would not constitute an "unanticipated expense incurred by the
REMIC" within the meaning of the REMIC Provisions.
Section 8.06 Eligibility Requirements for the Trustee. The Trustee
hereunder shall at all times be a corporation or association organized and
doing business under the laws of a state or the United States of America,
authorized under such laws to exercise corporate trust powers, having a
combined capital and surplus of at least $[__], subject to supervision or
examination by federal or state authority and with a credit rating which would
not cause any of the Rating Agencies to reduce their respective then current
ratings of the Certificates (or having provided such security from time to
time as is sufficient to avoid such reduction) as evidenced in writing by each
Rating Agency. If such corporation or association publishes reports of
condition at least annually, pursuant to law or to the requirements of the
aforesaid supervising or examining authority, then for the purposes of this
Section 8.06 the combined capital and surplus of such corporation or
association shall be deemed to be its combined capital and surplus as set
forth in its most recent report of condition so published. In case at any time
the Trustee shall cease to be eligible in accordance with this Section 8.06,
the Trustee shall resign immediately in the manner and with the effect
specified in Section 8.07. The entity serving as Trustee may have normal
banking and trust relationships with the Depositor or the Servicers and their
respective Affiliates; provided, however, that such entity cannot be an
Affiliate of the Depositor or a Servicer other than the Trustee in its role as
successor to a Servicer.
Section 8.07 Resignation and Removal of the Trustee. The Trustee may
at any time resign and be discharged from the trusts hereby created by giving
written notice of resignation to the Depositor, the Servicers and each Rating
Agency not less than 60 days before the date specified in such notice, when,
subject to Section 8.08, such resignation is to take effect, and acceptance by
a successor trustee in accordance with Section 8.08 meeting the qualifications
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set forth in Section 8.06. If no successor trustee meeting such qualifications
shall have been so appointed and have accepted appointment within 30 days
after the giving of such notice or resignation, the resigning Trustee may
petition any court of competent jurisdiction for the appointment of a
successor trustee.
If at any time the Trustee shall cease to be eligible in accordance
with Section 8.06 and shall fail to resign after written request thereto by
the Depositor, or if at any time the Trustee shall become incapable of acting,
or shall be adjudged as bankrupt or insolvent, or a receiver of the Trustee or
of its property shall be appointed, or any public officer shall take charge or
control of the Trustee or of its property or affairs for the purpose of
rehabilitation, conservation or liquidation, or a tax is imposed with respect
to the Trust Fund by any state in which the Trustee or the Trust Fund is
located and the imposition of such tax would be avoided by the appointment of
a different trustee, then the Depositor may remove the Trustee and appoint a
successor trustee by written instrument, in triplicate, one copy of which
shall be delivered to the Trustee, one copy to each Servicer and one copy to
the successor trustee.
The Holders of Certificates entitled to at least [___] of the Voting
Rights may at any time remove the Trustee and appoint a successor trustee by
written instrument or instruments, in triplicate, signed by such Holders or
their attorneys-in-fact duly authorized, one complete set of which shall be
delivered by the successor Trustee to each Servicer, one complete set to the
Trustee so removed and one complete set to the successor so appointed. The
successor trustee shall notify each Rating Agency of any removal of the
Trustee.
Any resignation or removal of the Trustee and appointment of a
successor trustee pursuant to this Section 8.07 shall become effective upon
acceptance of appointment by the successor trustee as provided in Section
8.08.
Section 8.08 Successor Trustee. Any successor trustee appointed as
provided in Section 8.07 shall execute, acknowledge and deliver to the
Depositor and to its predecessor trustee and the Servicers an instrument
accepting such appointment hereunder and thereupon the resignation or removal
of the predecessor trustee shall become effective and such successor trustee,
without any further act, deed or conveyance, shall become fully vested with
all the rights, powers, duties and obligations of its predecessor hereunder,
with the like effect as if originally named as trustee herein. The Depositor,
the Servicers and the predecessor trustee shall execute and deliver such
instruments and do such other things as may reasonably be required for more
fully and certainly vesting and confirming in the successor trustee all such
rights, powers, duties, and obligations.
No successor trustee shall accept appointment as provided in this
Section 8.08 unless at the time of its acceptance, the successor trustee is
eligible under Section 8.06 and its appointment does not adversely affect the
then current rating of the Certificates.
Upon acceptance of appointment by a successor trustee as provided in
this Section 8.08, the Depositor shall mail notice of the succession of such
trustee hereunder to all Holders of Certificates. If the Depositor fails to
mail such notice within 10 days after acceptance of appointment by the
successor trustee, the successor trustee shall cause such notice to be mailed
at the expense of the Depositor.
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Section 8.09 Merger or Consolidation of the Trustee. Any corporation
into which the Trustee may be merged or converted or with which it may be
consolidated or any corporation resulting from any merger, conversion or
consolidation to which the Trustee shall be a party, or any corporation
succeeding to the business of the Trustee, shall be the successor of the
Trustee hereunder; provided, that such corporation shall be eligible under
Section 8.06 without the execution or filing of any paper or further act on
the part of any of the parties hereto, anything herein to the contrary
notwithstanding. In connection with the succession to the Trustee under this
Agreement by any Person (i) into which the Trustee may be merged or
consolidated, or (ii) which may be appointed as a successor to the Trustee,
the Trustee shall notify the Depositor of such succession or appointment and
shall furnish to the Depositor in writing and in form and substance reasonably
satisfactory to the Depositor, all information reasonably necessary for the
Trustee to accurately and timely report, pursuant to Section 8.12(g), the
event under Item 6.02 of Form 8-K pursuant to the Exchange Act (if such
reports under the Exchange Act are required to be filed under the Exchange
Act).
Section 8.10 Appointment of Co-Trustee or Separate Trustee.
Notwithstanding any other provisions of this Agreement, at any time, for the
purpose of meeting any legal requirements of any jurisdiction in which any
part of the Trust Fund or property securing any Mortgage Note may at the time
be located, the applicable Servicer and the Trustee acting jointly shall have
the power and shall execute and deliver all instruments to appoint one or more
Persons approved by the Trustee to act as co-trustee or co-trustees jointly
with the Trustee, or separate trustee or separate trustees, of all or any part
of the Trust Fund, and to vest in such Person or Persons, in such capacity and
for the benefit of the Certificateholders, such title to the Trust Fund or any
part thereof, whichever is applicable, and, subject to the other provisions of
this Section 8.10, such powers, duties, obligations, rights and trusts as the
applicable Servicer and the Trustee may consider appropriate. If any Servicer
shall not have joined in such appointment within 15 days after the receipt by
such Servicer of a request to do so, or in the case an Event of Default shall
have occurred and be continuing, the Trustee alone shall have the power to
make such appointment. No co-trustee or separate trustee hereunder shall be
required to meet the terms of eligibility as a successor trustee under Section
8.06 and no notice to Certificateholders of the appointment of any co-trustee
or separate trustee shall be required under Section 8.08.
Every separate trustee and co-trustee shall, to the extent permitted
by law, be appointed and act subject to the following provisions and
conditions:
(a) To the extent necessary to effectuate the purposes of this Section
8.10, all rights, powers, duties and obligations conferred or imposed upon the
Trustee, except for the obligation of the Trustee under this Agreement to
advance funds on behalf of a Servicer, 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 a 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 applicable Trust Fund 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;
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(b) No trustee hereunder shall be held personally liable because of
any act or omission of any other trustee hereunder and such appointment shall
not, and shall not be deemed to, constitute any such separate trustee or
co-trustee as agent of the Trustee;
(c) The Trustee may at any time accept the resignation of or remove
any separate trustee or co-trustee; and
(d) The Trust Fund, and not the Trustee, shall be liable for the
payment of reasonable compensation, reimbursement and indemnification to any
such separate trustee or co-trustee.
Any notice, request or other writing given to the Trustee shall be
deemed to have been given to each of the separate trustees and co-trustees,
when and as effectively as if given to each of them. Every instrument
appointing any separate trustee or co-trustee shall refer to this Agreement
and the conditions of this Article VIII. Each separate trustee and co-trustee,
upon its acceptance of the trusts conferred, shall be vested with the estates
or property specified in its instrument of appointment, either jointly with
the Trustee or separately, as may be provided therein, subject to all the
provisions of this Agreement, specifically including every provision of this
Agreement relating to the conduct of, affecting the liability of, or affording
protection to, the Trustee. Every such instrument shall be filed with the
Trustee and a copy thereof given to each Servicer and the Depositor.
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.
Section 8.11 Tax Matters. It is intended that the assets with respect
to which any REMIC election pertaining to the Trust Fund is to be made, as set
forth in the Preliminary Statement, shall constitute, and that the conduct of
matters relating to such assets shall be such as to qualify such assets as, a
"real estate mortgage investment conduit" as defined in and in accordance with
the REMIC Provisions. In furtherance of such intention, the Trustee covenants
and agrees that it shall act as agent (and the Trustee is hereby appointed to
act as agent) on behalf of each Trust REMIC and that in such capacity it
shall:
(a) prepare and file in a timely manner, a U.S. Real Estate Mortgage
Investment Conduit (REMIC) Income Tax Return (Form 1066 or any successor form
adopted by the Internal Revenue Service) and prepare and file with the
Internal Revenue Service and applicable state or local tax authorities income
tax or information returns for each taxable year with respect to each Trust
REMIC containing such information and at the times and in the manner as may be
required by the Code or state or local tax laws, regulations, or rules, and
furnish to Certificateholders the schedules, statements or information at such
times and in such manner as may be required thereby;
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(b) within thirty days of the Closing Date, apply for an employer
identification number from the Internal Revenue Service via Form SS-4 or any
other acceptable method for all tax entities and shall also furnish to the
Internal Revenue Service, on Form 8811 or as otherwise may be required by the
Code, the name, title, address, and telephone number of the person that the
Holders of the Certificates may contact for tax information relating thereto,
together with such additional information as may be required by such Form, and
update such information at the time or times in the manner required by the
Code;
(c) make an election that each of Pooling-Tier REMIC-1, Pooling-Tier
REMIC-2, the Lower-Tier REMIC and the Upper-Tier REMIC be treated as a REMIC
on the federal tax return for its first taxable year (and, if necessary, under
applicable state law);
(d) prepare and forward to the Certificateholders and to the Internal
Revenue Service and, if necessary, state tax authorities, all information
returns and reports as and when required to be provided to them in accordance
with the REMIC Provisions, including the calculation of any original issue
discount using the prepayment assumption (as described in the Prospectus
Supplement);
(e) provide information necessary for the computation of tax imposed
on the Transfer of a Residual Certificate to a Person that is a Non-Permitted
Transferee, or an agent (including a broker, nominee or other middleman) of a
Non-Permitted Transferee, or a pass-through entity in which a Non-Permitted
Transferee is the record holder of an interest (the reasonable cost of
computing and furnishing such information may be charged to the Person liable
for such tax);
(f) to the extent that they are under its control, conduct matters
relating to such assets at all times that any Certificates are Outstanding so
as to maintain the status of each Trust REMIC as a REMIC under the REMIC
Provisions;
(g) not knowingly or intentionally take any action or omit to take
any action that would cause the termination of the REMIC status of any Trust
REMIC created hereunder;
(h) pay, from the sources specified in the last paragraph of this
Section 8.11, the amount of any federal or state tax, including prohibited
transaction taxes as described below, imposed on any Trust REMIC created
hereunder before its termination when and as the same shall be due and payable
(but such obligation shall not prevent the Trustee or any other appropriate
Person from contesting any such tax in appropriate proceedings and shall not
prevent the Trustee from withholding payment of such tax, if permitted by law,
pending the outcome of such proceedings);
(i) cause federal, state or local income tax or information returns
to be signed by the Trustee or such other Person as may be required to sign
such returns by the Code or state or local laws, regulations or rules; and
(j) maintain records relating to each Trust REMIC created hereunder,
including the income, expenses, assets, and liabilities thereof on a calendar
year basis and on the accrual method of accounting and the fair market value
and adjusted basis of the assets
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determined at such intervals as may be required by the Code, as may be
necessary to prepare the foregoing returns, schedules, statements or
information.
The Holder of the largest Percentage Interest of the Class R
Certificates shall act as Tax Matters Person for each Trust REMIC, within the
meaning of Treasury Regulations Section 1.860F-4(d), and the Trustee is hereby
designated as agent of such Certificateholder for such purpose (or if the
Trustee is not so permitted, such Holder shall be the Tax Matters Person in
accordance with the REMIC Provisions). In such capacity, the Trustee shall, as
and when necessary and appropriate, represent each Trust REMIC created
hereunder in any administrative or judicial proceedings relating to an
examination or audit by any governmental taxing authority, request an
administrative adjustment as to any taxable year of each Trust REMIC created
hereunder, enter into settlement agreements with any governmental taxing
agency, extend any statute of limitations relating to any tax item of each
Trust REMIC created hereunder, and otherwise act on behalf of each Trust REMIC
in relation to any tax matter or controversy involving it.
The Trustee shall treat the rights of the Class P Certificateholders
to Prepayment Charges, the rights of the Class X Certificateholders to receive
amounts in the Excess Reserve Fund Account and the Swap Account (subject to
the obligation to pay Basis Risk Carry Forward Amounts and Upper-Tier Carry
Forward Amounts) and the rights of the Offered Certificateholders to receive
Basis Risk Carry Forward Amounts and Upper-Tier Carry Forward Amounts as the
beneficial ownership of interests in a grantor trust, and not as obligations
of any Trust REMIC created hereunder, for federal income tax purposes. The
Trustee shall file or cause to be filed with the Internal Revenue Service Form
1041 or such other form as may be applicable and shall furnish or cause to be
furnished to the Class P Certificateholders, Class X Certificateholders and
the Offered Certificateholders the respective amounts described above that are
received, in the time or times and in the manner required by the Code.
To enable the Trustee to perform its duties under this Agreement, the
Depositor shall provide to the Trustee within ten days after the Closing Date
all information or data that the Trustee requests in writing and determines to
be relevant for tax purposes to the valuations and offering prices of the
Certificates, including the price, yield, prepayment assumption, and projected
cash flows of the Certificates and the Mortgage Loans. Moreover, the Depositor
shall provide information to the Trustee concerning the value, if any, to each
Class of Certificates of the right to receive Basis Risk Carry Forward Amounts
from the Excess Reserve Fund Account and Basis Risk Carry Forward Amounts and
Upper-Tier Carry Forward Amounts from the Swap Account. Thereafter, the
Depositor shall provide to the Trustee promptly upon written request therefor
any additional information or data that the Trustee may, from time to time,
reasonably request to enable the Trustee to perform its duties under this
Agreement; provided, however, that the Depositor shall not be required to
provide any information regarding the Mortgage Loans that the Servicer is
required to provide to the Trustee pursuant to this Agreement. The Depositor
hereby indemnifies the Trustee for any losses, liabilities, damages, claims,
or expenses of the Trustee arising from any errors or miscalculations of the
Trustee that result from any failure of the Depositor to provide pursuant to
this paragraph accurate information or data to the Trustee on a timely basis.
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Neither the Servicers nor the Trustee shall (i) permit the creation of
any interests in any Trust REMIC other than the regular and residual interests
set forth in the Preliminary Statement, (ii) receive any amount representing a
fee or other compensation for services (except as otherwise permitted by this
Agreement or the related Mortgage Loan documents) or (iii) otherwise knowingly
or intentionally take any action, cause the Trust Fund to take any action or
fail to take (or fail to cause to be taken) any action reasonably within its
control and the scope of duties more specifically set forth herein, that,
under the REMIC Provisions, if taken or not taken, as the case may be, could
(i) endanger the status of any Trust REMIC as a REMIC or (ii) result in the
imposition of a tax upon any Trust REMIC or the Trust Fund (including but not
limited to the tax on "prohibited transactions" as defined in Section
860F(a)(2) of the Code and the tax on contributions to a REMIC set forth in
Section 860G(d) of the Code, or the tax on "net income from foreclosure
property") unless the Trustee receives an Opinion of Counsel (at the expense
of the party seeking to take such action or, if such party fails to pay such
expense, at the expense of the Trust Fund, but in no event at the expense of
the Trustee) to the effect that the contemplated action will not, with respect
to the Trust Fund, any Trust REMIC created hereunder, endanger such status or
result in the imposition of such a tax).
If any tax is imposed on "prohibited transactions" of any Trust REMIC
as defined in Section 860F(a)(2) of the Code, on the "net income from
foreclosure property" of the Pooling-Tier REMIC-1 as defined in Section
860G(c) of the Code, on any contribution to any Trust REMIC after the Start-up
Day pursuant to Section 860G(d) of the Code, or any other tax is imposed,
including, if applicable, any minimum tax imposed on any Trust REMIC pursuant
to Sections 23153 and 24874 of the California Revenue and Taxation Code, if
not paid as otherwise provided for herein, the tax shall be paid by (i) the
Trustee if such tax arises out of or results from negligence of the Trustee in
the performance of any of its obligations under this Agreement, (ii) the
applicable Servicer and the Responsible Party, jointly, in the case of any
such minimum tax, and the Servicer if such tax arises out of or results from a
breach by such Servicer of any of its obligations under this Agreement, (iii)
the Responsible Party if such tax arises out of or results from the
Responsible Party's obligation to repurchase a Mortgage Loan pursuant to
Section 2.03, or (iv) in all other cases, or if the Trustee, the applicable
Servicer or the Responsible Party fails to honor its obligations under the
preceding clause (i), (ii), or (iii), any such tax will be paid with amounts
otherwise to be distributed to the Certificateholders, as provided in Section
4.02(a).
Section 8.12 Periodic Filings. (a) The Trustee and each Servicer shall
reasonably cooperate with the Depositor in connection with the reporting
requirements of the Trust under the Exchange Act. The Trustee shall prepare
for execution by the Depositor any Forms 8-K, 10-D and 10-K required by the
Exchange Act and the rules and regulations of the Commission thereunder, in
order to permit the timely filing thereof, pursuant to the terms of this
Section 8.12, and the Trustee shall file (via the Commission's Electronic Data
Gathering and Retrieval System) such Forms executed by the Depositor. The
Trustee shall have no duty to verify information received by it from other
Persons (other than Subcontractors utilized by the Trustee) in connection with
its duties under this Section 8.12.
(b) Within 15 days after each Distribution Date (subject to permitted
extensions under the Exchange Act), the Trustee shall prepare and file on
behalf of the Trust any Form 10-D required by the Exchange Act, in form and
substance as required by the Exchange
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Act. The Trustee shall file each Form 10-D with a copy of the related
Monthly Statement attached thereto. Any disclosure in addition to the Monthly
Statement that is required to be included on Form 10-D ("Additional Form 10-D
Disclosure") shall be prepared by the party responsible for preparing such
disclosure as set forth on Exhibit Q hereto and the Trustee shall compile such
disclosure pursuant to the following paragraph. The Trustee will have no duty
or liability for any failure hereunder to determine or prepare any Additional
Form 10-D Disclosure, except as set forth in the next paragraph.
As set forth on Exhibit Q hereto, within 5 calendar days after the
related Distribution Date, certain parties to this Agreement shall be required
to provide to the Trustee and the Depositor, to the extent known by such
applicable parties, any Additional Form 10-D Disclosure, if applicable. The
Trustee shall compile all such information provided to it in a Form 10-D
prepared by it.
After preparing the Form 10-D, the Trustee shall forward
electronically a draft copy of the Form 10-D to the Depositor for review,
verification and execution by the Depositor. No later than 2 Business Days
prior to the 15th calendar day after the related Distribution Date, an officer
of the Depositor shall sign the Form 10-D and return an electronic or fax copy
of such signed Form 10-D (with an original executed hard copy to follow by
overnight mail) to the Trustee. If a Form 10-D cannot be filed on time or if a
previously filed Form 10-D needs to be amended, the Trustee will follow the
procedures set forth in Section 8.12(f)(ii). The signing party at the
Depositor can be contacted at the Depositor's address for notices set forth in
Section 10.5(b)(ii)(a), or such other address as to which the Depositor has
provided prior written notice to the Trustee. The Depositor acknowledges that
the performance by the Trustee of its duties under this Section 8.12(b)
related to the timely preparation and filing of Form 10-D is contingent, in
part, upon each Servicer and the Depositor and any other Person obligated to
provide Additional Form 10-D Disclosure as set forth on Exhibit Q hereto
observing all applicable deadlines in the performance of their duties under
this Section 8.12(b). The Trustee shall have no liability for any loss,
expense, damage, or claim arising out of or with respect to any failure to
properly prepare and/or timely file such Form 10-D, where such failure results
from the Trustee's inability or failure to obtain or receive, on a timely
basis, any information from any party hereto (other than the Trustee or any
Subcontractor utilized by the Trustee) needed to prepare, arrange for
execution or file such Form 10-D, not resulting from its own negligence, bad
faith or willful misconduct.
(c) Within 90 days after the end of each fiscal year of the Trust or
such earlier date as may be required by the Exchange Act (the "10-K Filing
Deadline"), commencing in March 2007, the Trustee shall prepare and file on
behalf of the Trust a Form 10-K, in form and substance as required by the
Exchange Act. Each such Form 10-K shall include the following items, in each
case to the extent they have been delivered to the Trustee within the
applicable time frames set forth in this Agreement, (i) an annual compliance
statement for each Servicer and each Subservicer engaged by any Servicer and
the Trustee, as described under Section 3.22, (ii)(A) the annual reports on
assessment of compliance with servicing criteria for the Trustee, the
Servicers, each Subservicer engaged by any Servicer and each Servicing
Function Participant utilized by the Servicer or the Trustee, as described
under Section 3.23, and (B) if any such report on assessment of compliance
with servicing criteria described under Section 3.23 identifies any material
instance of noncompliance, disclosure identifying such instance of
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noncompliance, or such report on assessment of compliance with servicing
criteria described under Section 3.23 is not included as an exhibit to such
Form 10-K, disclosure that such report is not included and an explanation why
such report is not included, (iii)(A) the registered public accounting firm
attestation report for the Trustee, each Servicer, each Subservicer engaged by
a Servicer and each Servicing Function Participant utilized by a Servicer or
the Trustee, as described under Section 3.23, and (B) if any registered public
accounting firm attestation report described under Section 3.23 identifies any
material instance of noncompliance, disclosure identifying such instance of
noncompliance, or if any such registered public accounting firm attestation
report is not included as an exhibit to such Form 10-K, disclosure that such
report is not included and an explanation why such report is not included, and
(iv) a certification in the form attached hereto as Exhibit L, with such
changes as may be necessary or appropriate as a result of changes promulgated
by the Commission (the "Sarbanes Certification"), which shall be signed by the
senior officer of the Depositor in charge of securitization. Any disclosure or
information in addition to (i) through (iv) above that is required to be
included on Form 10-K ("Additional Form 10-K Disclosure") shall be prepared by
the party responsible for preparing such disclosure as set forth on Exhibit X
hereto, and the Trustee shall compile such disclosure pursuant to the
following paragraph. The Trustee will have no duty or liability for any
failure hereunder to determine or prepare any Additional Form 10-K Disclosure,
except as set forth in the next paragraph.
As set forth on Exhibit R hereto, no later than March [_] of each year
(or, in the case of the Servicers, March [_] of each year) that the Trust is
subject to the Exchange Act reporting requirements, commencing in 2007,
certain parties to this Agreement shall be required to provide to the Trustee
and the Depositor, to the extent known by such applicable parties, any
Additional Form 10-K Disclosure, if applicable. The Trustee shall compile all
such information provided to it in a Form 10-K prepared by it.
After preparing the Form 10-K, the Trustee shall forward
electronically a draft copy of the Form 10-K to the Depositor for review,
verification and execution by the Depositor. No later than 5:00 p.m. EST on
the 3rd Business Day prior to the 10-K Filing Deadline, an officer of the
Depositor shall sign the Form 10-K and return an electronic or fax copy of
such signed Form 10-K (with an original executed hard copy to follow by
overnight mail) to the Trustee. If a Form 10-K cannot be filed on time or if a
previously filed Form 10-K needs to be amended, the Trustee will follow the
procedures set forth in Section 8.12(f)(ii). The signing party at the
Depositor can be contacted at the Depositor's address for notices set forth in
Section 10.5(b)(ii)(a), or such other address as to which the Depositor has
provided prior written notice to the Trustee. The Depositor and each Servicer
acknowledge that the performance by the Trustee of its duties under this
Section 8.12(c) related to the timely preparation and filing of Form 10-K is
contingent, in part, upon each Servicer (and any Subservicer or Servicing
Function Participant engaged by a Servicer) and the Depositor and any other
Person obligated to provide Additional Form 10-K Disclosure as set forth on
Exhibit R hereto, observing all applicable deadlines in the performance of
their duties under this Section 8.12(c), Section 8.12(d), Section 3.22 and
Section 3.23. The Trustee shall have no liability for any loss, expense,
damage or claim arising out of or with respect to any failure to properly
prepare and/or timely file such Form 10-K, where such failure results from the
Trustee's inability or failure to obtain or receive, on a timely basis, any
information from any party hereto (other than the Trustee or any
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Subcontractor utilized by the Trustee) needed to prepare, arrange for
execution or file such Form 10-K, not resulting from its own negligence, bad
faith or willful misconduct.
(d) In connection with the execution of a Sarbanes Certification, the
Trustee shall sign a certification (in the form attached hereto as Exhibit M,
with such changes as may be necessary or appropriate as a result of changes
promulgated by the Commission) for the benefit of the Depositor and its
officers, directors and Affiliates, and each Servicer shall sign a
certification solely with respect to such Servicer (in the form attached
hereto as Exhibit N, with such changes as may be necessary or appropriate as a
result of changes promulgated by the Commission) for the benefit of the
Depositor, the Trustee and their respective officers, directors and
Affiliates. Each such certification shall be delivered to the Depositor no
later than March [_] of each year (or if such day is not a Business Day, the
immediately preceding Business Day) and the Depositor shall deliver the
Sarbanes Certification no later than the time set forth for the delivery to
the Trustee of the signed Form 10-K pursuant to Section 8.12(d) for such year.
In the event that prior to the filing date of the Form 10-K in March [_] of
each year, the Trustee or any Servicer has actual knowledge of information
material to the Sarbanes Certification, that party shall promptly notify the
Depositor and each of the other parties signing the certifications. In
addition, (i) the Trustee shall indemnify and hold harmless the Depositor and
the Sponsor and their officers, directors, employees, agents and Affiliates
from and against any losses, damages, penalties, fines, forfeitures,
reasonable and necessary legal fees and related costs, judgments and other
costs and expenses arising out of or based upon any breach of the Trustee's
obligations under this Section 8.12(d) or any material misstatement or
material omission contained in any information, report, certification,
accountants' letter or other material provided in written or electronic form
pursuant to Sections 3.23 and 8.12 of this Agreement and Exhibits Q, R and S
to this Agreement provided by or on behalf of the Trustee or any Subcontractor
utilized by the Trustee (excluding any information, report, certification,
accountants' letter or other materials provided in written or electronic form
by or on behalf of any Person other than the Trustee or any Subcontractor
utilized by the Trustee), negligence, bad faith or willful misconduct in
connection therewith, and (ii) each Servicer, severally and not jointly, shall
indemnify and hold harmless the Depositor, the Sponsor, the Trustee and their
respective officers, directors, employees, agents and Affiliates from and
against any losses, damages, penalties, fines, forfeitures, reasonable and
necessary legal fees and related costs, judgments and other costs and expenses
arising out of or based upon any breach of the applicable Servicer's
obligations under this Section 8.12(d) or any material misstatement or
material omission, negligence, bad faith or willful misconduct of such
Servicer in connection therewith. If the indemnification provided for herein
is unavailable or insufficient to hold harmless any indemnified party, then
(i) the Trustee agrees in connection with a breach of the Trustee's
obligations under this Section 8.12(d) or any material misstatement or
material omission contained in any information, report, certification,
accountants' letter or other material provided in written or electronic form
pursuant to Sections 3.23 and 8.12 of this Agreement and Exhibits T, U and V
to this Agreement provided by or on behalf of the Trustee or any Subcontractor
utilized by the Trustee (excluding any information, report, certification,
accountants' letter or other materials provided in written or electronic form
by or on behalf of any Person other than the Trustee or any Subcontractor
utilized by the Trustee), negligence, bad faith or willful misconduct in
connection therewith that it shall contribute to the amount paid or payable by
the Depositor and the Sponsor as a result of the losses, claims, damages or
liabilities of the Depositor and the Sponsor in such proportion as is
appropriate to reflect the relative fault of the Depositor and the Sponsor on
the one hand and
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the Trustee on the other and (ii) each Servicer agrees that it shall
contribute to the amount paid or payable by such indemnified party as a result
of the losses, claims, damages or liabilities of such indemnified party in
such proportion as is appropriate to reflect the relative fault of such
indemnified party, on the one hand, and such Servicer, on the other hand, in
connection with a breach of the Servicers' obligations under this Section
8.12(d) or any material misstatement or material omission, negligence, bad
faith or willful misconduct of such Servicer in connection therewith.
(e) Upon any filing with the Commission, the Trustee shall promptly
deliver to the Depositor a copy of each such executed report, statement or
information.
(f) (i) The obligations set forth in paragraphs (a) through (d) of
this Section shall only apply with respect to periods for which reports are
required to be filed with respect to the Trust under the Exchange Act. Prior
to January [_] of the first year in which the Trustee is able to do so under
applicable law, the Trustee shall file a Form 15 Suspension Notification with
respect to the Trust, with a copy to the Depositor. At any time after the
filing of a Form 15 Suspension Notification, if the number of Holders of the
Offered Certificates of record exceeds the number set forth in Section 15(d)
of the Exchange Act or the regulations promulgated pursuant thereto which
would cause the Trust to again become subject to the reporting requirements of
the Exchange Act, the Trustee shall recommence preparing and filing reports on
Form 10-K, 10-D and 8-K as required pursuant to this Section 8.12 and the
parties hereto shall again have the obligations set forth in this Section.
(ii) In the event that the Trustee is unable to timely file
with the Commission all or any required portion of any Form 8-K, 10-D
or 10-K required to be filed pursuant to this Agreement because
required disclosure information was either not delivered to it or
delivered to it after the delivery deadlines set forth in this
Agreement, the Trustee will immediately notify the Depositor and the
Servicers. In the case of Form 10-D and 10-K, the Depositor, Servicers
and Trustee will thereupon cooperate to prepare and file a Form 12b-25
and a 10-DA and 10-KA as applicable, pursuant to Rule 12b-25 of the
Exchange Act. In the case of Form 8-K, the Trustee will, upon receipt
of all disclosure information required to be included on Form 8-K,
include such disclosure information on the next Form 10-D. In the
event that any previously filed Form 8-K, 10-D or 10-K needs to be
amended, the party to this Agreement deciding that an amendment to
such Form 8-K, 10-D or 10-K is required will notify the Depositor, the
Trustee and the Servicers and such parties will cooperate to prepare
any necessary Form 8-KA, 10-DA or 10-KA. Any Form 15, Form 12b-25 or
any amendment to Form 8-K, 10-D or 10-K shall be signed by an officer
of the Depositor. The Depositor and Servicers acknowledge that the
performance by the Trustee of its duties under this Section 8.12(f)
related to the timely preparation and filing of Form 15, a Form 12b-25
or any amendment to Form 8-K, 10-D or 10-K is contingent upon the
Servicers and the Depositor observing all applicable deadlines (and
the related grace periods thereto) in the performance of their duties
under this Section 8.12 and Sections 3.22 and 3.23. The Trustee shall
have no liability for any loss, expense, damage, claim arising out of
or with respect to any failure to properly prepare and/or timely file
any such Form 15, Form 12b-25 or any amendments to Forms 8-K, 10-D or
10-K, where such failure results from the Trustee's inability or
failure to obtain or receive, on a timely basis, any information from
any party hereto
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(other than the Trustee or any Subcontractor utilized by the Trustee)
needed to prepare, arrange for execution or file such Form 15, Form
12b-25 or any amendments to Forms 8-K, 10-D or 10-K, not resulting
from its own negligence, bad faith or willful misconduct.
(g) Within four (4) Business Days after the occurrence of an event
requiring disclosure on Form 8-K (each such event, a "Reportable Event"), and
also if requested by the Depositor, the Trustee shall prepare and file on
behalf of the Trust any Form 8-K, as required by the Exchange Act, provided
that the Depositor shall file the initial Form 8-K in connection with the
issuance of the Certificates. Any disclosure or information related to a
Reportable Event or that is otherwise required to be included on Form 8-K
("Form 8-K Disclosure Information") shall be prepared by the party responsible
for preparing such disclosure as set forth on Exhibit S hereto and compiled by
the Trustee pursuant to the following paragraph. The Trustee will have no duty
or liability for any failure hereunder to determine or prepare any Form 8-K
Disclosure Information or any Form 8-K, except as set forth in the next
paragraph.
As set forth on Exhibit S hereto, for so long as the Trust is subject
to the Exchange Act reporting requirements, no later than noon (Eastern
Standard Time) on the 2nd Business Day after the occurrence of a Reportable
Event certain parties to this Agreement shall be required to provide to the
Depositor and the Trustee, to the extent known by such applicable parties, any
Form 8-K Disclosure Information, if applicable. The Trustee shall compile all
such information provided to it in a Form 8-K prepared by it.
After preparing the Form 8-K, the Trustee shall forward electronically
a draft copy of the Form 8-K to the Depositor for review, verification and
execution by the Depositor. No later than the end of the 3rd Business Day
after the Reportable Event, an officer of the Depositor shall sign the Form
8-K and return an electronic or fax copy of such signed Form 8-K (with an
original executed hard copy to follow by overnight mail) to the Trustee. If a
Form 8-K cannot be filed on time or if a previously filed Form 8-K needs to be
amended, the Trustee will follow the procedures set forth in Section
8.12(f)(ii). The signing party at the Depositor can be contacted at the
Depositor's address for notices set forth in Section 10.5(b)(ii)(a), or such
other address as to which the Depositor has provided prior written notice to
the Trustee. The Depositor acknowledges that the performance by the Trustee of
its duties under this Section 8.12(g) related to the timely preparation and
filing of Form 8-K is contingent, in part, upon each Servicer and the
Depositor and any other Person obligated to provide Form 8-K Disclosure
Information as set forth on Exhibit S hereto, observing all applicable
deadlines in the performance of their duties under this Section 8.12(g). The
Trustee shall have no liability for any loss, expense, damage or claim arising
out of or with respect to any failure to properly prepare and/or timely file
such Form 8-K, where such failure results from the Trustee's inability or
failure to obtain or receive, on a timely basis, any information from any
party hereto (other than the Trustee or any Subcontractor utilized by the
Trustee) needed to prepare, arrange for execution or file such Form 8-K, not
resulting from its own negligence, bad faith or willful misconduct.
(h) The Trustee shall have no liability for any loss, expense, damage
or claim arising out of or resulting from (i) the accuracy or inaccuracy of
any Additional Form 10-D Disclosure, Additional Form 10-K Disclosure or Form
8-K Disclosure Information (excluding
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any information therein provided by the Trustee or any Subcontractor utilized
by the Trustee) provided to the Trustee in connection with the preparation of
Forms 10-D, 10-K and 8-K pursuant to this Section 8.12, or (ii) the failure of
the Depositor to timely execute and return for filing any Forms 10-D, 10-K and
8-K required to be filed by the Trustee pursuant to this Section 8.12, in
either case, not resulting from the Trustee's own negligence, bad faith or
misconduct.
Section 8.13 Tax Treatment of Upper-Tier Carry Forward Amounts, Basis
Risk Carry Forward Amounts and Class IO Shortfalls; Tax Classification of the
Excess Reserve Fund Account, Swap Account and the Interest Rate Swap
Agreement.For federal income tax purposes, the Trustee shall treat the Excess
Reserve Fund Account and the Swap Account as beneficially owned by the holders
of the Class X Certificates and shall treat such portion of the Trust Fund as
a grantor trust, within the meaning of subpart E, Part I of subchapter J of
the Code. The Trustee shall treat the rights that each Class of Offered
Certificates has to receive payments of Basis Risk Carry Forward Amounts, and
to the extent not paid from the Excess Reserve Fund Account, Basis Risk Carry
Forward Amounts from the Swap Account (together with Basis Risk Carry Forward
Amounts from the Excess Reserve Fund Account) as rights to receive payments
under an interest rate cap contract written by the Class X Certificateholder
in favor of each such Class and beneficially owned by each such Class through
the grantor trust. Accordingly, each Class of Certificates (excluding the
Class X, Class P and Class R Certificates) will be comprised of two components
- an Upper-Tier Regular Interest and an interest in an interest rate cap
contract, and the Class X Certificates will be comprised of four components -
two Upper-Tier Regular Interests (the Class X Interest and the Class IO
Interest), an interest in the Excess Reserve Fund Account, subject to
obligation to pay Basis Risk Carry Forward Amounts, and ownership of the Swap
Account and the Interest Rate Swap Agreement, subject to the obligation to pay
Upper-Tier Carry Forward Amounts including, but without duplication, Basis
Risk Carry Forward Amounts. The Trustee shall allocate the issue price for a
Class of Certificates among the respective components for purposes of
determining the issue price of the Upper-Tier Regular Interest component based
on information received from the Depositor. Unless otherwise advised by the
Depositor in writing, for federal income tax purposes, the Trustee is hereby
directed to assign a value of zero to the right of each Holder of a Offered
Certificate to receive the related Upper-Tier Carry Forward Amount and,
without duplication, the related Basis Risk Carry Forward Amount for purposes
of allocating the purchase price of a Offered Certificate acquired by an
initial Holder thereof between such right and the related Upper-Tier Regular
Interest.
Holders of Offered Certificates shall also be treated as having agreed
to pay, on each Distribution Date, to the Holders of the Class X Certificates
an aggregate amount equal to the excess, if any, of (i) Net Swap Payments and
Swap Termination Payments (other than Defaulted Swap Termination Payments)
over (ii) the sum of amounts payable on the Class X Interest available for
such payments and amounts payable on the Class IO Interest (such excess, a
"Class IO Shortfall"), first from interest and then from principal
distributable on the Offered Certificates. A Class IO Shortfall payable from
interest collections shall be allocated pro rata among such Offered
Certificates based on the amount of interest otherwise payable to such Class
of Offered Certificates, and a Class IO Shortfall payable from principal
collections shall be allocated in reverse sequential order beginning with the
most subordinate Class of Offered Certificates then Outstanding.
Any payments of Class IO Shortfalls shall be treated for tax
purposes as having been received by the Holders of such Class of Offered
Certificates in respect of the corresponding Upper-Tier Regular Interest and
as having been paid by such Holders to the Holders of the Class X Certificates
through the Swap Account. In the event any class of Upper-Tier Regular
Interest corresponding to a class of Offered Certificates is subject to the
Upper-Tier REMIC WAC Rate, and such rate exceeds the applicable Pass-Through
Rate of the Corresponding Class of Certificates as a result of a Swap
Termination Payment, such excess shall be deemed first paid to the related
Upper-Tier Regular Interest and then paid to the Class X Certificates in a
manner analogous to Class IO Shortfalls.
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ARTICLE IX
TERMINATION
Section 9.01 Termination upon Liquidation or Purchase of the Mortgage
Loans. Subject to Section 9.03, the obligations and responsibilities of the
Depositor, the Servicers, the Responsible Party and the Trustee created hereby
with respect to the Trust Fund shall terminate upon the earlier of (a) the
purchase, on or after the Optional Termination Date by [_______], of all
Mortgage Loans (and REO Properties) at the price equal to the sum of (i) 100%
of the unpaid principal balance of each Mortgage Loan (other than in respect
of REO Property) plus accrued and unpaid interest thereon at the applicable
Mortgage Rate, (ii) the lesser of (x) the appraised value of any REO Property
as determined by the higher of two appraisals completed by two independent
appraisers selected by [_______] at the expense of [_______], plus accrued and
unpaid interest on each Mortgage Loan at the applicable Mortgage Rate and (y)
the unpaid principal balance of each Mortgage Loan related to any REO
Property, in each case plus accrued and unpaid interest thereon at the
applicable Mortgage Rate, and (iii) any Swap Termination Payment owed to the
Swap Provider pursuant to the Interest Rate Swap Agreement, and (b) the later
of (i) the maturity or other liquidation (or any Advance with respect thereto)
of the last Mortgage Loan remaining in the Trust Fund and the disposition of
all REO Property and (ii) the distribution to Certificateholders of all
amounts required to be distributed to them pursuant to this Agreement. In no
event shall the trusts created hereby continue beyond the expiration of 21
years from the death of the survivor of the descendants of ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇,
the late Ambassador of the United States to the Court of St. James's, living
on the date hereof.
Notwithstanding anything to the contrary contained herein, no such
purchase shall be permitted unless (i) after distribution of the proceeds
thereof to the Certificateholders (other than the Holders of the Class X,
Class P and Residual Certificates) pursuant to Section 9.02, the distribution
of the remaining proceeds to the Class X and Class P Certificates is
sufficient to pay the outstanding principal amount of and accrued and unpaid
interest on the NIM Securities, to the extent the NIM Securities are then
outstanding, or (ii) prior to such purchase, [_______] shall have deposited in
the related Collection Account an amount to be remitted to the NIM Trustee
that, together with such remaining proceeds, will be sufficient to pay the
outstanding principal amount of and accrued and unpaid interest on the NIM
Securities, to the extent the NIM Securities are then outstanding.
Section 9.02 Final Distribution on the Certificates. If on any
Remittance Date, [_______] determines that there are no Outstanding Mortgage
Loans and no other funds or assets
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in the Trust Fund other than the funds in the Collection Accounts, [_______]
shall direct the Trustee promptly to send a Notice of Final Distribution to
each Certificateholder and the Swap Provider. If [_______] elects to terminate
the Trust Fund pursuant to clause (a) of Section 9.01, [_______] shall notify,
by the [__] day of the month preceding the month of the final distribution,
[_______] shall notify the Depositor and the Trustee of the date [_______]
intends to terminate the Trust Fund and of the applicable repurchase price of
the Mortgage Loans and REO Properties.
A Notice of Final Distribution, specifying the Distribution Date on
which Certificateholders may surrender their Certificates for payment of the
final distribution and cancellation, shall be given promptly by the Trustee by
letter to Certificateholders mailed not earlier than the 10th day and not
later than the 15th day of the month of such final distribution. Any such
Notice of Final Distribution shall specify (a) 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, (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 at the time such Notice of
Final Distribution is given to Certificateholders.
In the event such Notice of Final Distribution is given, [_______]
shall cause all funds in its Collection Account to be remitted to the Trustee
for deposit in the Distribution Account on the Business Day prior to the
applicable Distribution Date in an amount equal to the final distribution in
respect of the Certificates. 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 to [_______], the Custodial Files for the
Mortgage Loans.
Upon presentation and surrender of the Certificates, the Trustee shall
cause to be distributed to the Certificateholders of each Class (after
reimbursement of all amounts due to [_______], the Depositor and the Trustee
hereunder), in each case on the final Distribution Date and in the order set
forth in Section 4.02, in proportion to their respective Percentage Interests,
with respect to Certificateholders of the same Class, up to an amount equal to
(i) as to each Class of Regular Certificates (except the Class X
Certificates), the Certificate Balance thereof plus for each such Class and
the Class X Certificates accrued interest thereon in the case of an
interest-bearing Certificate and all other amounts to which such Classes are
entitled pursuant to Section 4.02 and (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.
In the event that any affected Certificateholders 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 Certificateholders 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 Certificateholders concerning surrender of their
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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.
Section 9.03 Additional Termination Requirements. In the event
[_______] exercises its purchase option with respect to the Mortgage Loans as
provided in Section 9.01, the Trust Fund shall be terminated in accordance
with the following additional requirements, unless the Trustee has been
supplied with an Opinion of Counsel, at the expense [_______], to the effect
that the failure to comply with the requirements of this Section 9.03 will not
(i) result in the imposition of taxes on "prohibited transactions" on any
Trust REMIC as defined in Section 860F of the Code, or (ii) cause any Trust
REMIC to fail to qualify as a REMIC at any time that any Certificates are
Outstanding:
(a) The Trustee shall sell all of the assets of the Trust Fund to
[_______], and, by no later than the next Distribution Date after such sale,
shall distribute to the Certificateholders the proceeds of such sale in
complete liquidation of each Trust REMIC; and
(b) The Trustee shall attach a statement to the final federal income
tax return for each Trust REMIC stating that pursuant to Treasury Regulations
Section 1.860F-1, the first day of the 90-day liquidation period for each such
Trust REMIC was the date on which the Trustee sold the assets of the Trust
Fund to [_______].
ARTICLE X
MISCELLANEOUS PROVISIONS
Section 10.01 Amendment. This Agreement may be amended from time to
time by the Depositor, the Responsible Party, the Servicers and the Trustee,
without the consent of any of the Certificateholders (i) to cure any ambiguity
or mistake, (ii) to correct any defective provision herein or to supplement
any provision herein which may be inconsistent with any other provision
herein, (iii) to add to the duties of the Depositor or the Servicers, (iv) to
add any other provisions with respect to matters or questions arising
hereunder or (v) to modify, alter, amend, add to or rescind any of the terms
or provisions contained in this Agreement; provided that any amendment
pursuant to clauses (iv) or (v) above shall not, as evidenced by an Opinion of
Counsel (which Opinion of Counsel shall not be an expense of the Trustee or
the Trust Fund), adversely affect in any material respect the interests of any
Certificateholder; and provided, further, that any such amendment pursuant to
clause (iv) or (v) above shall not be deemed to adversely affect in any
material respect the interests of the Certificateholders if the Person
requesting the amendment obtains a letter from each Rating Agency stating that
the amendment would not result in the downgrading or withdrawal of the
respective ratings then assigned to the Certificates; it being understood and
agreed that any such letter in and of itself will not represent a
determination as to the materiality of any such amendment and will represent a
determination only as to the credit issues affecting any such rating. The
Trustee, the Depositor, the Responsible Party and the Servicers also may at
any time and from time to time amend this Agreement, but without the consent
of the Certificateholders to modify, eliminate or add to any of its provisions
to such extent as shall be necessary or helpful to (i) maintain the
qualification of
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each Trust REMIC under the Code, (ii) avoid or minimize the risk of the
imposition of any tax on any Trust REMIC pursuant to the Code that would be a
claim at any time prior to the final redemption of the Certificates or (iii)
comply with any other requirements of the Code; provided, that the Trustee has
been provided an Opinion of Counsel, which opinion shall be an expense of the
party requesting such opinion but in any case shall not be an expense of the
Trustee or the Trust Fund, to the effect that such action is necessary or
helpful to, as applicable, (i) maintain such qualification, (ii) avoid or
minimize the risk of the imposition of such a tax or (iii) comply with any
such requirements of the Code.
This Agreement may also be amended from time to time by the Depositor,
the Servicers, the Responsible Party and the Trustee with the consent of the
Holders of Certificates evidencing Percentage Interests aggregating not less
than [__]% of each Class of Certificates affected thereby for the purpose of
adding any provisions to or changing in any manner or eliminating any of the
provisions of this Agreement or of modifying in any manner the rights of the
Holders of Certificates; provided, however, that no such amendment shall (i)
reduce in any manner the amount of, or delay the timing of, payments required
to be distributed on any Certificate without the consent of the Holder of such
Certificate, (ii) adversely affect in any material respect the interests of
the Holders of any Class of Certificates in a manner other than as described
in clause (i), without the consent of the Holders of Certificates of such
Class evidencing, as to such Class, Percentage Interests aggregating not less
than [__]% or (iii) reduce the aforesaid percentages of Certificates the
Holders of which are required to consent to any such amendment, without the
consent of the Holders of all such Certificates then Outstanding.
Notwithstanding any contrary provision of this Agreement, the Trustee
shall not consent to any amendment to this Agreement unless (i) it shall have
first received an Opinion of Counsel, which opinion shall not be an expense of
the Trustee or the Trust Fund, to the effect that such amendment will not
cause the imposition of any tax on any Trust REMIC or the Certificateholders
or cause any such Trust REMIC to fail to qualify as a REMIC or the grantor
trust to fail to qualify as a grantor trust at any time that any Certificates
are Outstanding and (ii) the party seeking such amendment shall have provided
written notice to the Rating Agencies (with a copy of such notice to the
Trustee) of such amendment, stating the provisions of the Agreement to be
amended.
Notwithstanding the foregoing provisions of this Section 10.01, with
respect to any amendment that significantly modifies the permitted activities
of the Trustee or the Servicers, any Certificate beneficially owned by the
Depositor shall be deemed not to be Outstanding (and shall not be considered
when determining the percentage of Certificateholders consenting or when
calculating the total number of Certificates entitled to consent) for purposes
of determining if the requisite consents of Certificateholders under this
Section 10.01 have been obtained.
Promptly after the execution of any amendment to this Agreement
requiring the consent of Certificateholders, the Trustee shall furnish written
notification of the substance or a copy of such amendment to each
Certificateholder and each Rating Agency.
It shall not be necessary for the consent of Certificateholders under
this Section 10.01 to approve the particular form of any proposed amendment,
but it shall be
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sufficient if such consent shall approve the substance thereof. The manner of
obtaining such consents and of evidencing the authorization of the execution
thereof by Certificateholders shall be subject to such reasonable regulations
as the Trustee may prescribe.
Nothing in this Agreement shall require the Trustee to enter into an
amendment without receiving an Opinion of Counsel (which Opinion shall not be
an expense of the Trustee or the Trust Fund), satisfactory to the Trustee that
(i) such amendment is permitted and is not prohibited by this Agreement and
that all requirements for amending this Agreement have been complied with
(including the obtaining of any required consents); and (ii) either (A) the
amendment does not adversely affect in any material respect the interests of
any Certificateholder or (B) the conclusion set forth in the immediately
preceding clause (A) is not required to be reached pursuant to this Section
10.01.
Notwithstanding the foregoing, any amendment to this Agreement shall
require the prior written consent of the Swap Provider if such amendment
materially and adversely affects the rights or interests of the Swap Provider.
Section 10.02 Recordation of Agreement; Counterparts. This Agreement
is subject to recordation in all appropriate public offices for real property
records in all the counties or other comparable jurisdictions in which any or
all of the Mortgaged Properties are situated, and in any other appropriate
public recording office or elsewhere, such recordation to be effected by the
Servicers at the direction and expense of the Depositor, but only upon receipt
of an Opinion of Counsel to the effect that such recordation materially and
beneficially affects the interests of the Certificateholders.
For the purpose of facilitating the recordation of this Agreement as
herein provided and for other purposes, this Agreement may be executed
simultaneously in any number of counterparts, each of which counterparts shall
be deemed to be an original, and such counterparts shall constitute but one
and the same instrument.
Section 10.03 Governing Law. THIS AGREEMENT SHALL BE CONSTRUED IN
ACCORDANCE WITH AND GOVERNED BY THE SUBSTANTIVE LAWS OF THE STATE OF NEW YORK
APPLICABLE TO AGREEMENTS MADE AND TO BE PERFORMED IN THE STATE OF NEW YORK AND
THE OBLIGATIONS, RIGHTS AND REMEDIES OF THE PARTIES HERETO AND THE
CERTIFICATEHOLDERS SHALL BE DETERMINED IN ACCORDANCE WITH SUCH LAWS.
Section 10.04 Intention of Parties. It is the express intent of the
parties hereto that the conveyance (i) of the Mortgage Loans by the Depositor
and (ii) of the Trust Fund by the Depositor to the Trustee each be, and be
construed as, an absolute sale thereof. It is, further, not the intention of
the parties that such conveyances be deemed a pledge thereof. However, in the
event that, notwithstanding the intent of the parties, such assets are held to
be the property of the Depositor, as the case may be, or if for any other
reason this Agreement is held or deemed to create a security interest in
either such assets, then (i) this Agreement shall be deemed to be a security
agreement within the meaning of the Uniform Commercial Code of the State of
New York and (ii) the conveyances provided for in this Agreement shall be
deemed to be an
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assignment and a grant by the Depositor to the Trustee, for the benefit of the
Certificateholders, of a security interest in all of the assets transferred,
whether now owned or hereafter acquired.
The Depositor, for the benefit of the Certificateholders, shall, to
the extent consistent with this Agreement, take such actions as may be
necessary to ensure that, if this Agreement were deemed to create a security
interest in the Trust Fund, such security interest would be deemed to be a
perfected security interest of first priority under applicable law and will be
maintained as such throughout the term of the Agreement. The Depositor shall
arrange for filing any Uniform Commercial Code continuation statements in
connection with any security interest granted or assigned to the Trustee for
the benefit of the Certificateholders.
Section 10.05 Notices. (a) The Trustee shall use its best efforts to
promptly provide notice to each Rating Agency with respect to each of the
following of which it has actual knowledge:
(i) Any material change or amendment to this Agreement;
(ii) The occurrence of any Event of Default that has not been
cured;
(iii) The resignation or termination of a Servicer or the
Trustee and the appointment of any successor;
(iv) The repurchase or substitution of Mortgage Loans pursuant
to Section 2.03; and
(v)The final payment to Certificateholders.
(b) In addition, the Trustee shall promptly furnish to each Rating
Agency copies (which may be provided electronically via the Trustee's website)
of the following:
(i) Each report to Certificateholders described in Section
4.03; and
(ii) Any notice of a purchase of a Mortgage Loan pursuant to
Section 2.02, 2.03 or 3.11.
All directions, demands, consents and notices hereunder shall be in
writing (unless otherwise indicated in this paragraph) and shall be deemed to
have been duly given when delivered to: (a) in the case of the Depositor or
the Underwriter, ▇▇▇▇▇▇ ▇▇▇▇▇▇▇ ABS Capital I Inc. or ▇▇▇▇▇▇ ▇▇▇▇▇▇▇ & Co.
Incorporated, (1) ▇▇▇▇▇▇ ▇▇▇▇▇▇▇, ▇▇▇▇▇▇ ▇▇▇▇▇▇▇ - SPG Finance, ▇▇▇▇ ▇▇▇▇▇▇▇▇,
▇▇▇▇ ▇▇▇▇▇, ▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇; (2) ▇▇▇▇▇▇▇▇ ▇▇▇▇▇, ▇▇▇▇▇▇ ▇▇▇▇▇▇▇ -
Legal Counsel (Securities), ▇▇▇▇ ▇▇▇▇▇▇▇▇, ▇▇▇▇ ▇▇▇▇▇, ▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇
▇▇▇▇▇; (3) ▇▇▇▇ ▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇ ▇▇▇▇▇▇▇ - Servicing Oversight, ▇▇▇▇ ▇-▇▇▇
▇▇▇., ▇▇▇▇▇ ▇▇▇, ▇▇▇▇ ▇▇▇▇▇, ▇▇▇▇▇▇▇ ▇▇▇▇▇; (4) ▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇
▇▇▇▇▇▇▇ - Whole Loan Operations, ▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇, ▇▇ ▇▇▇▇▇; (5)
▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇▇ ▇▇▇▇▇▇▇ - RFPG, ▇▇▇▇ ▇▇▇▇▇▇▇▇, ▇▇▇▇ ▇▇▇▇▇, ▇▇▇ ▇▇▇▇, ▇▇▇
▇▇▇▇ ▇▇▇▇▇; and (6) in the case of a direction or demand, notification to the
following email addresses: ▇▇▇▇.▇▇▇▇▇▇▇▇@▇▇▇▇▇▇▇▇▇▇▇▇▇.▇▇▇,
▇▇▇▇▇▇▇▇.▇▇▇▇▇▇@▇▇▇▇▇▇▇▇▇▇▇▇▇.▇▇▇, ▇▇▇▇▇.▇▇▇▇▇▇@▇▇▇▇▇▇▇▇▇▇▇▇▇.▇▇▇ and
▇▇▇▇.▇▇▇▇▇▇▇▇@▇▇▇▇▇▇▇▇▇▇▇▇▇.▇▇▇; or such other address as may be hereafter
furnished to the
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other parties hereto by the Depositor in writing; (b) in the case of
[_________], [__________________], in care of [ADDRESS], with a copy to:
[______________], or such other address as may be hereafter furnished to the
other parties hereto and the Swap Provider in writing; (c) in the case of
[____________________], [ADDRESS], with a copy to [____________________], or
such other address as may be hereafter furnished to the other parties hereto
and the Swap Provider by [_______] in writing; (d) in the case of the Trustee,
to [_______________], [ADDRESS] or such other address as the Trustee may
hereafter furnish to the other parties hereto in writing; (e) in the case of
the Responsible Party, [___________], [ADDRESS], and the Swap Provider in
writing, or such other address as may be hereafter furnished to the other
parties hereto by the Responsible Party in writing; (f) in the case of the
Swap Provider to [ADDRESS], Attention: [_______________], Facsimile No.
[___________], or such other address as the Swap Provider may hereafter
furnish to the Depositor, the Trustee and the Servicers; in the case of each
of the Rating Agencies, the address specified therefor in the definition
corresponding to the name of such Rating Agency. Notices to Certificateholders
shall be deemed given when mailed, first class postage prepaid, to their
respective addresses appearing in the Certificate Register.
Section 10.06 Severability of Provisions. If any one or more of the
covenants, agreements, provisions or terms of this Agreement shall be for any
reason whatsoever held invalid, then such covenants, agreements, provisions or
terms shall be deemed severable from the remaining covenants, agreements,
provisions or terms of this Agreement and shall in no way affect the validity
or enforceability of the other provisions of this Agreement or of the
Certificates or the rights of the Holders thereof.
Section 10.07 Assignment; Sales; Advance Facilities. Notwithstanding
anything to the contrary contained herein, except as provided in Section 6.04,
this Agreement may not be assigned by any Servicer without the prior written
consent of the Trustee and the Depositor; provided, however, each Servicer is
hereby authorized to enter into an Advance Facility under which (l) such
Servicer sells, assigns or pledges to an Advancing Person the Servicer's
rights under this Agreement to be reimbursed for any P&I Advances or Servicing
Advances and/or (2) an Advancing Person agrees to fund some or all P&I
Advances or Servicing Advances required to be made by such Servicer pursuant
to this Agreement. No consent of the Trustee, Certificateholders or any other
party is required before a Servicer may enter into an Advance Facility.
Notwithstanding the existence of any Advance Facility under which an Advancing
Person agrees to fund P&I Advances and/or Servicing Advances on a Servicer's
behalf, such Servicer shall remain obligated pursuant to this Agreement to
make P&I Advances and Servicing Advances pursuant to and as required by this
Agreement, and shall not be relieved of such obligations by virtue of such
Advance Facility.
Reimbursement amounts shall consist solely of amounts in respect of
P&I Advances and/or Servicing Advances made with respect to the Mortgage Loans
for which a Servicer would be permitted to reimburse itself in accordance with
this Agreement, assuming such Servicer had made the related P&I Advance(s)
and/or Servicing Advance(s).
The applicable Servicer shall maintain and provide to any successor
servicer a detailed accounting on a loan-by-loan basis as to amounts advanced
by, pledged or assigned to, and reimbursed to any Advancing Person. The
successor servicer shall be entitled to rely on any
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such information provided by the predecessor servicer, and the successor
servicer shall not be liable for any errors in such information.
An Advancing Person who purchases or receives an assignment or pledge
of the rights to be reimbursed for P&I Advances and/or Servicing Advances,
and/or whose obligations hereunder are limited to the funding of P&I Advances
and/or Servicing Advances shall not be required to meet the criteria for
qualification of a Subservicer set forth in this Agreement.
The documentation establishing any Advance Facility shall require that
reimbursement amounts distributed with respect to each Mortgage Loan be
allocated to outstanding ▇▇▇▇▇▇▇▇▇▇▇▇ ▇&▇ Advances or Servicing Advances (as
the case may be) made with respect to that Mortgage Loan on a "first-in, first
out" (FIFO) basis. Such documentation shall also require the applicable
Servicer to provide to the related Advancing Person or its designee
loan-by-loan information with respect to each such reimbursement amount
distributed to such Advancing Person or Advance Facility trustee on each
Distribution Date, to enable the Advancing Person or Advance Facility trustee
to make the FIFO allocation of each such reimbursement amount with respect to
each applicable Mortgage Loan. The applicable Servicer shall remain entitled
to be reimbursed by the Advancing Person or Advance Facility trustee for all
P&I Advances and Servicing Advances funded by such Servicer to the extent the
related rights to be reimbursed therefor have not been sold, assigned or
pledged to an Advancing Person.
Any amendment to this Section 10.07 or to any other provision of this
Agreement that may be necessary or appropriate to effect the terms of an
Advance Facility as described generally in this Section 10.07, including
amendments to add provisions relating to a successor servicer, may be entered
into by the Trustee, the Depositor, the Responsible Parties and the Servicers
without the consent of any Certificateholder, notwithstanding anything to the
contrary in this Agreement, upon receipt by the Trustee of an Opinion of
Counsel that such amendment has no material adverse effect on the
Certificateholders or written confirmation from the Rating Agencies that such
amendment will not adversely affect the ratings on the Certificates. Prior to
entering into an Advance Facility, the applicable Servicer shall notify the
lender under such facility in writing that: (a) the Advances financed by
and/or pledged to the lender are obligations owed to such Servicer on a
non-recourse basis payable only from the cash flows and proceeds received
under this Agreement for reimbursement of Advances only to the extent provided
herein, and the Trustee and the Trust are not otherwise obligated or liable to
repay any Advances financed by the lender; (b) such Servicer will be
responsible for remitting to the lender the applicable amounts collected by it
as reimbursement for Advances funded by the lender, subject to the
restrictions and priorities created in this Agreement; and (c) the Trustee
shall not have any responsibility to track or monitor the administration of
the financing arrangement between such applicable Servicer and the lender.
Section 10.08 Limitation on Rights of Certificateholders. The death or
incapacity of any Certificateholder shall not operate to terminate this
Agreement or the Trust created hereby, nor entitle such Certificateholder's
legal representative or heirs to claim an accounting or to take any action or
commence any proceeding in any court for a petition or winding up of the Trust
created hereby, or otherwise affect the rights, obligations and liabilities of
the parties hereto or any of them.
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No Certificateholder shall have any right to vote (except as provided
herein) or in any manner otherwise control the operation and management of the
Trust Fund, or the obligations of the parties hereto, nor shall anything
herein set forth or contained in the terms of the Certificates be construed so
as to constitute the Certificateholders from time to time as partners or
members of an association; nor shall any Certificateholder be under any
liability to any third party by reason of any action taken by the parties to
this Agreement pursuant to any provision hereof.
No Certificateholder shall have any right by virtue or by availing
itself of any provisions of this Agreement to institute any suit, action or
proceeding in equity or at law upon or under or with respect to this
Agreement, unless such Holder previously shall have given to the Trustee a
written notice of an Event of Default and of the continuance thereof, as
herein provided, and unless the Holders of Certificates evidencing not less
than [__]% of the Voting Rights evidenced by the Certificates shall also have
made written request to the Trustee to institute such action, suit or
proceeding in its own name as Trustee hereunder and shall have offered to the
Trustee such reasonable indemnity as it may require against the costs,
expenses, and liabilities to be incurred therein or thereby, and the Trustee,
for 60 days after its receipt of such notice, request and offer of indemnity
shall have neglected or refused to institute any such action, suit or
proceeding; it being understood and intended, and being expressly covenanted
by each Certificateholder with every other Certificateholder and the Trustee,
that no one or more Holders of Certificates shall have any right in any manner
whatever by virtue or by availing itself or themselves of any provisions of
this Agreement to affect, disturb or prejudice the rights of the Holders of
any other of the Certificates, or to obtain or seek to obtain priority over or
preference to any other such Holder or to enforce any right under this
Agreement, except in the manner herein provided and for the common benefit of
all Certificateholders. For the protection and enforcement of the provisions
of this Section 10.08, each and every Certificateholder and the Trustee shall
be entitled to such relief as can be given either at law or in equity.
Section 10.09 Inspection and Audit Rights. Each Servicer agrees that,
on 5 Business Days prior notice, it will permit any representative of the
Depositor or the Trustee during such Person's normal business hours, to
examine all the books of account, records, reports and other papers of such
Person relating to the Mortgage Loans, to make copies and extracts therefrom,
to cause such books to be audited by independent certified public accountants
selected by the Depositor or the Trustee and to discuss its affairs, finances
and accounts relating to the Mortgage Loans with its officers, employees and
independent public accountants (and by this provision each Servicer hereby
authorizes said accountants to discuss with such representative such affairs,
finances and accounts), all at such reasonable times and as often as may be
reasonably requested. Any out-of-pocket expense of a Servicer incident to the
exercise by the Depositor or the Trustee of any right under this Section 10.09
shall be borne by such Servicer.
Section 10.10 Certificates Nonassessable and Fully Paid. It is the
intention of the Depositor that Certificateholders shall not be personally
liable for obligations of the Trust Fund, that the interests in the Trust Fund
represented by the Certificates shall be nonassessable for any reason
whatsoever, and that the Certificates, upon due authentication thereof by the
Trustee pursuant to this Agreement, are and shall be deemed fully paid.
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Section 10.11 Rule of Construction. Article and section headings are
for the convenience of the reader and shall not be considered in interpreting
this Agreement or the intent of the parties hereto.
Section 10.12 Waiver of Jury Trial. EACH PARTY HEREBY KNOWINGLY,
VOLUNTARILY AND INTENTIONALLY, WAIVES (TO THE EXTENT PERMITTED BY APPLICABLE
LAW) ANY RIGHT IT MAY HAVE TO A TRIAL BY JURY OF ANY DISPUTE ARISING UNDER OR
RELATING TO THIS AGREEMENT AND AGREES THAT ANY SUCH DISPUTE SHALL BE TRIED
BEFORE A JUDGE SITTING WITHOUT A JURY.
Section 10.13 Rights of the Swap Provider.The Swap Provider shall be
deemed a third-party beneficiary of this Agreement to the same extent as if it
were a party hereto and shall have the right to enforce its rights under this
Agreement.
Section 10.14 Regulation AB Compliance; Intent of the Parties;
Reasonableness.The parties hereto acknowledge that interpretations of the
requirements of Regulation AB may change over time, whether due to
interpretive guidance provided by the Commission or its staff, consensus among
participants in the asset-backed securities markets, advice of counsel, or
otherwise, and agree to comply with requests made by the Depositor in good
faith for delivery of information under these provisions on the basis of
evolving interpretations of Regulation AB. In connection with the Trust, each
Servicer and the Trustee shall cooperate fully with the Depositor to deliver
to the Depositor (including its assignees or designees), any and all
statements, reports, certifications, records and any other information
available to such party and reasonably necessary in the good faith
determination of the Depositor to permit the Depositor to comply with the
provisions of Regulation AB, together with such disclosures relating to each
Servicer and the Trustee, as applicable, reasonably believed by the Depositor
to be necessary in order to effect such compliance.
[SIGNATURE PAGE FOLLOWS]
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IN WITNESS WHEREOF, the parties hereto have caused their names to be
signed hereto by their respective officers thereunto duly authorized as of the
day and year first above written.
▇▇▇▇▇▇ ▇▇▇▇▇▇▇ ABS CAPITAL I INC., as
Depositor
By:_______________________________________
Name:
Title:
[_________________________],
as Servicer
By:_______________________________________
Name:
Title:
[_________________________],
as Servicer
By:_______________________________________
Name:
Title:
[_______________], solely as Trustee and not
in its individual capacity
By:_______________________________________
Name:
Title:
By:_______________________________________
Name:
Title:
[_______________],
as Responsible Party
By:_______________________________________
Name:
Title:
SCHEDULE I
Mortgage Loan Schedule
(Available Upon Request to Trustee)
S-I-1
SCHEDULE II
▇▇▇▇▇▇ ▇▇▇▇▇▇▇ ABS Capital Inc.
Mortgage Pass-Through Certificates,
Series 2006-[___]
Representations and Warranties of [_______], as Servicer
--------------------------------------------------------
[_______] hereby makes the representations and warranties set forth
in this Schedule II to the Depositor and the Trustee as of the Closing Date.
Capitalized terms used but not otherwise defined in the Agreement to which
this Schedule III is attached shall have the meaning ascribed thereto in the
Agreement to which this Schedule II is attached.
(1) [_______] is duly organized as a corporation and is validly
existing and in good standing under the laws of the state of [STATE],
and is licensed and qualified to transact any and all business
contemplated by this Pooling and Servicing Agreement to be conducted by
[_______] in any state in which a Mortgaged Property securing a Mortgage
Loan is located or is otherwise not required under applicable law to
effect such qualification and, in any event, is in compliance with the
doing business laws of any such State, to the extent necessary to ensure
its ability to enforce each Mortgage Loan and to service the Mortgage
Loans in accordance with the terms of this Pooling and Servicing
Agreement;
(2) [_______] has the full power and authority to service each
Mortgage Loan, and to execute, deliver and perform, and to enter into
and consummate the transactions contemplated by this Pooling and
Servicing Agreement and has duly authorized by all necessary action on
the part of [_______] the execution, delivery and performance of this
Pooling and Servicing Agreement; and this Pooling and Servicing
Agreement, assuming the due authorization, execution and delivery
thereof by the Depositor, each Responsible Party, the other Servicers
and the Trustee, constitutes a legal, valid and binding obligation of
[_______], enforceable against [_______] in accordance with its terms;
except to the extent that (a) the enforceability thereof may be limited
by bankruptcy, insolvency, moratorium, receivership and other similar
laws relating to creditors' rights generally and (b) the remedy of
specific performance and injunctive and other forms of equitable relief
may be subject to the equitable defenses and to the discretion of the
court before which any proceeding therefor may be brought;
(3) The execution and delivery of this Pooling and Servicing
Agreement by [_______], the servicing of the Mortgage Loans required to
be serviced by [_______] hereunder, the consummation by [_______] of any
other of the transactions herein contemplated, and the fulfillment of or
compliance with the terms hereof are in the ordinary course of business
of [_______] and will not (A) result in a breach of any term or
provision of the organizational documents of [_______] or (B) conflict
with, result in a breach, violation or acceleration of, or result in a
default under, the terms of any other material agreement or instrument
to which [_______] is a party or by which it may be bound, or any law,
statute, rule, order, regulation, judgment or decree applicable to
[_______] or its property of any court, regulatory body, administrative
agency or
S-II-1
governmental body having jurisdiction over [_______]; and [_______] is
not a party to, bound by, or in breach or violation of any indenture
or other agreement or instrument, or subject to or in violation of any
law, statute, rule, order, regulation, judgment or decree of any
court, regulatory body, administrative agency or governmental body
having jurisdiction over it, which (w) materially and adversely
affects or, to [_______]'s knowledge, would in the future materially
and adversely affect, the ability of [_______] to perform its
obligations under this Pooling and Servicing Agreement, (x) materially
and adversely affects or, to [_______]'s knowledge, would in the
future materially and adversely affect, the business, operations,
financial condition, properties or assets of [_______] taken as a
whole, (y) impair the ability of the Trust to realize on the Mortgage
Loans, or (z) impair the value of the Mortgage Loans;
(4) [_______] has the facilities, procedures, and experienced
personnel necessary for the sound servicing of mortgage loans of the
same type as the Mortgage Loans;
(5) [_______] does not believe, nor does it have any reason or
cause to believe, that it cannot perform each and every covenant
contained in this Pooling and Servicing Agreement;
(6) No action, suit, proceeding or investigation is pending or
threatened against [_______], before any court, administrative agency or
other tribunal asserting the invalidity of this Pooling and Servicing
Agreement, seeking to prevent the consummation of any of the
transactions contemplated by this Pooling and Servicing Agreement or
which, either in any one instance or in the aggregate, may result in any
material adverse change in the business, operations, financial
condition, properties or assets of [_______], or in any material
impairment of the right or ability of [_______] to carry on its business
substantially as now conducted, or in any material liability on the part
of [_______], or which would draw into question the validity of this
Pooling and Servicing Agreement or the Mortgage Loans or of any action
taken or to be taken in connection with the obligations of [_______]
contemplated herein, or which would be likely to impair materially the
ability of [_______] to perform under the terms of this Pooling and
Servicing Agreement;
(7) No consent, approval, authorization or order of any court or
governmental agency or body is required for the execution, delivery and
performance by [_______] of, or compliance by [_______] with, this
Pooling and Servicing Agreement or the servicing of the Mortgage Loans
as evidenced by the consummation by [_______] of the transactions
contemplated by this Pooling and Servicing Agreement, except for such
consents, approvals, authorizations or orders, if any, that have been
obtained prior to the Closing Date; and
(8) With respect to each Mortgage Loan serviced by [_______]
hereunder, to the extent [_______] serviced such Mortgage Loan and to
the extent [_______] provided monthly reports to the three credit
repositories, [_______] has fully furnished, in accordance with the Fair
Credit Reporting Act and its implementing regulations, accurate and
complete information (i.e., favorable and unfavorable) on its borrower
credit files to
S-II-2
Equifax, Experian, and Trans Union Credit Information
Company (three of the credit repositories), on a monthly basis.
S-II-3
SCHEDULE III
▇▇▇▇▇▇ ▇▇▇▇▇▇▇ ABS Capital Inc.
Mortgage Pass-Through Certificates,
Series 2006-[___]
Representations and Warranties of the Responsible Party as to the Mortgage
--------------------------------------------------------------------------
Loans
-----
[___________] hereby makes the representations and warranties set
forth in this Schedule III as to the Mortgage Loans only to the Depositor, the
Servicers and the Trustee, as of [_______], 2006 (the "Securitization Closing
Date") (unless otherwise expressly indicated). Capitalized terms used but not
otherwise defined in this Schedule III shall have the meanings ascribed
thereto in the Purchase Agreement.
(1) Mortgage Loans as Described. [___________] has delivered to the
Sponsor, as of [_______], 2006, the Data Tape Information and that Data
Tape Information and the information set forth on the Mortgage Loan
Schedule (other than item (21) thereof, as to which [___________] makes
no representation or warranty) are true and correct, including, without
limitation, the terms of the Prepayment Charges, if any, as of the
Securitization Closing Date;
(2) Payments Current. All payments required to be made up to
[_______], 2006 for the Mortgage Loan under the terms of the Mortgage
Note, other than payments not yet 30 days delinquent, have been made and
credited. No payment required under the Mortgage Loan is 30 days or more
delinquent nor has any payment under the Mortgage Loan been 30 days or
more delinquent at any time since the origination of the Mortgage Loan.
The first Scheduled Payment was or shall be made with respect to the
Mortgage Loan on its Due Date or within the grace period, all in
accordance with the terms of the related Mortgage Note;
(3) No Outstanding Charges. There are no defaults in complying with
the terms of the Mortgage, and all taxes, governmental assessments,
insurance premiums, water, sewer and municipal charges, leasehold
payments or ground rents which previously became due and owing have been
paid, or an escrow of funds has been established in an amount sufficient
to pay for every such item which remains unpaid and which has been
assessed but is not yet due and payable. Neither [___________] nor any
Affiliate has advanced funds, or induced, solicited or knowingly
received any advance of funds by a party other than the Mortgagor,
directly or indirectly, for the payment of any amount required under the
Mortgage Loan, except for interest accruing from the date of the
Mortgage Note or date of disbursement of the Mortgage Loan proceeds,
whichever is earlier, to the day which precedes by one month the Due
Date of the first installment of principal and interest;
(4) Original Terms Unmodified. The terms of the Mortgage Note and
Mortgage have not been impaired, waived, altered or modified in any
respect from the date of origination, except by a written instrument
which has been recorded, if necessary
S-III-1
to protect the interests of the Sponsor, and which has been delivered
to the Trustee and the terms of which are reflected in the Mortgage
Loan Schedule, the Data Tape Information or included in the Mortgage
File. The substance of any such waiver, alteration or modification has
been approved by the title insurer, if any, to the extent required by
the policy, and its terms are reflected on the Mortgage Loan Schedule.
No Mortgagor has been released, in whole or in part, except in
connection with an assumption agreement, approved by the title
insurer, to the extent required by the policy, and which assumption
agreement is part of the Mortgage Loan File delivered to the Trustee
and the terms of which are reflected in the Mortgage Loan Schedule and
the Data Tape Information;
(5) No Defenses. The Mortgage Loan is not subject to any right of
rescission, set-off, counterclaim or defense, including, without
limitation, the defense of usury, nor will the operation of any of the
terms of the Mortgage Note or the Mortgage, or the exercise of any right
thereunder, render either the Mortgage Note or the Mortgage
unenforceable, in whole or in part, and no such right of rescission,
set-off, counterclaim or defense has been asserted with respect thereto,
and no Mortgagor was a debtor in any state or federal bankruptcy or
insolvency proceeding at the time the Mortgage Loan was originated;
(6) Hazard Insurance. Pursuant to the terms of the Mortgage, all
buildings or other improvements upon the Mortgaged Property are insured
by a generally acceptable insurer against loss by fire, hazards of
extended coverage and such other hazards as are provided for in the
▇▇▇▇▇▇ ▇▇▇ Guides or by ▇▇▇▇▇▇▇ Mac, as well as all additional
requirements set forth in Section 3.13 of the Pooling and Servicing
Agreement. If required by the National Flood Insurance Act of 1968, as
amended, the Mortgage Loan is covered by a flood insurance policy
meeting the requirements of the current guidelines of the Federal
Insurance Administration is in effect which policy conforms to ▇▇▇▇▇▇
▇▇▇ and ▇▇▇▇▇▇▇ Mac, as well as all additional requirements set forth in
Section 3.13 of the Pooling and Servicing Agreement. All individual
insurance policies contain a standard mortgagee clause naming
[____________] and its successors and assigns as mortgagee, and all
premiums thereon have been paid. The Mortgage obligates the Mortgagor
thereunder to maintain the hazard insurance policy at the Mortgagor's
cost and expense, and on the Mortgagor's failure to do so, authorizes
the holder of the Mortgage to obtain and maintain such insurance at such
Mortgagor's cost and expense, and to seek reimbursement therefor from
the Mortgagor. Where required by state law or regulation, the Mortgagor
has been given an opportunity to choose the carrier of the required
hazard insurance, provided the policy is not a "master" or "blanket"
hazard insurance policy covering a condominium, or any hazard insurance
policy covering the common facilities of a planned unit development. The
hazard insurance policy is the valid and binding obligation of the
insurer, is in full force and effect, and will be in full force and
effect and inure to the benefit of the Trustee upon the consummation of
the transactions contemplated by this Agreement. [___________] has not
engaged in, and has no knowledge of the Mortgagor's having engaged in,
any act or omission which would impair the coverage of any such policy,
the benefits of the endorsement provided for herein, or the validity and
binding effect of either, including, without limitation, no unlawful
fee, commission, kickback or other unlawful compensation or value of any
kind
S-III-2
has been or will be received, retained or realized by any attorney,
firm or other person or entity, and no such unlawful items have been
received, retained or realized by [___________];
(7) Compliance with Applicable Laws. Any and all requirements of
any federal, state or local law, including, without limitation, usury,
truth-in-lending, real estate settlement procedures, consumer credit
protection, equal credit opportunity and disclosure and all predatory
and abusive lending laws applicable to the Mortgage Loan, including,
without limitation, any provisions therein relating to Prepayment
Charges, have been complied with, the consummation of the transactions
contemplated hereby will not involve the violation of any such laws or
regulations, and [___________] shall maintain in its possession,
available for the Sponsor's or the Trustee's inspection, and shall
deliver to the Sponsor upon demand, evidence of compliance with all such
requirements;
(8) No Satisfaction of Mortgage. Other than with respect to any
Mortgage Loan that was subject to a Principal Prepayment in Full
occurring after the Cut-off Date but prior to the Securitization Closing
Date, the Mortgage has not been satisfied, cancelled, subordinated or
rescinded, in whole or in part, and the Mortgaged Property has not been
released from the lien of the Mortgage, in whole or in part, nor has any
instrument been executed that would effect any such release,
cancellation, subordination or rescission. [___________] has not waived
the performance by the Mortgagor of any action, if the Mortgagor's
failure to perform such action would cause the Mortgage Loan to be in
default, nor has [___________] waived any default resulting from any
action or inaction by the Mortgagor;
(9) Location and Type of Mortgaged Property. The Mortgaged Property
is located in the state identified in the Mortgage Loan Schedule and
consists of a single parcel of real property with a detached single
family residence erected thereon, or a two- to four-family dwelling, or
an individual condominium unit in a low rise condominium project, or an
individual unit in a planned unit development or a de minimis planned
unit development which is in each case four stories or less; provided,
however, that any condominium unit, planned unit development, mobile
home (double wide only) or manufactured dwelling shall conform with the
applicable ▇▇▇▇▇▇ ▇▇▇ and ▇▇▇▇▇▇▇ Mac requirements regarding such
dwellings and that no Mortgage Loan is secured by a single parcel of
real property with a cooperative housing corporation, a log home or,
except as specified on the Mortgage Loan Schedule, a mobile home erected
thereon or by a mixed use property, a property in excess of 10 acres or
other unique property types. As of the date of origination, no portion
of the Mortgaged Property was used for commercial purposes, and since
the date of origination, no portion of the Mortgaged Property has been
used for commercial purposes; provided, that Mortgaged Properties which
contain a home office shall not be considered as being used for
commercial purposes as long as the Mortgaged Property has not been
altered for commercial purposes and is not storing any chemicals or raw
materials other than those commonly used for homeowner repair,
maintenance and/or household purposes. With respect to any Mortgage Loan
secured by a Mortgaged Property improved by manufactured housing, (i)
such Mortgage Loan conforms with the applicable ▇▇▇▇▇▇ Mae or ▇▇▇▇▇▇▇
Mac requirements regarding
S-III-3
mortgage loans related to manufactured dwellings, (ii) the related
manufactured housing unit is permanently affixed to the land, (iii)
the related manufactured housing unit and the related land are subject
to a Mortgage properly filed in the appropriate public recording
office and naming [____________] as mortgagee, (iv) the applicable
laws of the jurisdiction in which the related Mortgaged Property is
located will deem the manufactured dwelling located on such Mortgaged
Property to be a part of the real property on which such dwelling is
located, and (v) such Manufactured Home Mortgage Loan is secured by
manufactured housing treated as a single family residence under
Section 25(e)(10) of the Code;
(10) Valid First Lien. The Mortgage is a valid, subsisting,
enforceable and perfected first lien (with respect to each First Lien
Mortgage Loan) or second lien (with respect to each Second Lien Mortgage
Loan) on the Mortgaged Property, including all buildings and
improvements on the Mortgaged Property and all installations and
mechanical, electrical, plumbing, heating and air conditioning systems
located in or annexed to such buildings, and all additions, alterations
and replacements made at any time with respect to the foregoing. The
lien of the Mortgage is subject only to:
(i) with respect to a Second Lien Mortgage Loan only, the lien
of the first mortgage on the Mortgaged Property;
(ii) the lien of current real property taxes and assessments
not yet due and payable;
(iii)covenants, conditions and restrictions, rights of way,
easements and other matters of the public record as of the date of
recording acceptable to prudent mortgage lending institutions
generally and specifically referred to in the lender's title
insurance policy delivered to the originator of the Mortgage Loan
and (a) specifically referred to or otherwise considered in the
appraisal made for the originator of the Mortgage Loan or (b) which
do not adversely affect the Appraised Value of the Mortgaged
Property set forth in such appraisal; and
(iv) other matters to which like properties are commonly
subject which do not materially interfere with the benefits of the
security intended to be provided by the Mortgage or the use,
enjoyment, value or marketability of the related Mortgaged
Property;
Any security agreement, chattel mortgage or equivalent
document related to and delivered in connection with the Mortgage
Loan establishes and creates a valid, subsisting, enforceable and
perfected first lien and first priority (with respect to each First
Lien Mortgage Loan) security interest on the property described
therein and [___________] has full right to sell and assign the
same to the Sponsor
(11) Validity of Mortgage Documents. The Mortgage Note and the
Mortgage and any other agreement executed and delivered by a Mortgagor
in connection with a Mortgage Loan are genuine, and each is the legal,
valid and binding obligation of the
S-III-4
maker thereof enforceable in accordance with its terms (including,
without limitation, any provisions therein relating to Prepayment
Charges). All parties to the Mortgage Note, the Mortgage and any other
such related agreement had legal capacity to enter into the Mortgage
Loan and to execute and deliver the Mortgage Note, the Mortgage and any
such agreement, and the Mortgage Note, the Mortgage and any other such
related agreement have been duly and properly executed by other such
related parties. No fraud, error, omission, misrepresentation,
negligence or similar occurrence with respect to a Mortgage Loan has
taken place on the part of any Person, including without limitation,
the Mortgagor, any appraiser, any builder or developer, or any other
party involved in the origination of the Mortgage Loan. [___________]
or its Affiliate has reviewed all of the documents constituting the
Servicing File and [___________] has made such inquiries as it deems
necessary to make and confirm the accuracy of the representations set
forth herein;
(12) Full Disbursement of Proceeds. The Mortgage Loan has been
closed and the proceeds of the Mortgage Loan have been fully disbursed
and there is no requirement for future advances thereunder, and any and
all requirements as to completion of any on-site or off-site improvement
and as to disbursements of any escrow funds therefor have been complied
with. All costs, fees and expenses incurred in making or closing the
Mortgage Loan and the recording of the Mortgage were paid, and the
Mortgagor is not entitled to any refund of any amounts paid or due under
the Mortgage Note or Mortgage;
(13) Ownership. Immediately prior to the transfer contemplated by
the Purchase Agreement, [___________] was the sole owner of record and
holder of the Mortgage Loan and the indebtedness evidenced by each
Mortgage Note and upon the sale of the Mortgage Loans to the Sponsor,
[___________] retained the Mortgage Files or any part thereof with
respect thereto not delivered to the Sponsor or the Sponsor's designee,
in trust only for the purpose of servicing and supervising the servicing
of each Mortgage Loan. The Mortgage Loan was not assigned or pledged,
and [___________] had good, indefeasible and marketable title thereto,
and has full right to transfer and sell the Mortgage Loan to the Sponsor
free and clear of any encumbrance, equity, participation interest, lien,
pledge, charge, claim or security interest, and has full right and
authority subject to no interest or participation of, or agreement with,
any other party, to sell and assign each Mortgage Loan pursuant to the
Purchase Agreement and following the sale of each Mortgage Loan, the
Sponsor will own such Mortgage Loan free and clear of any encumbrance,
equity, participation interest, lien, pledge, charge, claim or security
interest. After the Securitization Closing Date, [___________] will have
no right to modify or alter the terms of the sale of the Mortgage Loan
and [___________] will have no obligation or right to repurchase the
Mortgage Loan or substitute another Mortgage Loan, except as provided in
this Agreement;
(14) Doing Business. All parties which have had any interest in the
Mortgage Loan, whether as mortgagee, assignee, pledgee or otherwise, are
(or, during the period in which they held and disposed of such interest,
were) (1) in compliance with any and all applicable licensing
requirements of the laws of the state wherein the Mortgaged Property is
located, and (2) either (i) organized under the laws of such state, or
(ii) qualified to do business in such state, or (iii) a federal savings
and loan association, a savings bank or a
S-III-5
national bank having a principal office in such state, or (3) not doing
business in such state;
(15) LTV. No First Lien Mortgage Loan has an LTV greater than 100%,
and no Second Lien Mortgage Loan has an CLTV greater than 100%;
(16) Title Insurance. The Mortgage Loan is covered by an ALTA
lender's title insurance policy, or with respect to any Mortgage Loan
for which the related Mortgaged Property is located in [STATE] a CLTA
lender's title insurance policy, or other generally acceptable form of
policy or insurance acceptable to ▇▇▇▇▇▇ ▇▇▇ or ▇▇▇▇▇▇▇ Mac with respect
to Mortgage Loans and each such title insurance policy is issued by a
title insurer acceptable to ▇▇▇▇▇▇ Mae or ▇▇▇▇▇▇▇ Mac and qualified to
do business in the jurisdiction where the Mortgaged Property is located,
insuring [____________], its successors and assigns, as to the first
priority lien (with respect to a First Lien Mortgage Loan) or the second
priority lien (with respect to a Second Lien Mortgage Loan) of the
Mortgage in the original principal amount of the Mortgage Loan, subject
only to the exceptions contained in clauses (i), (ii), (iii) and (iv) of
representation 10 of this Schedule III, and in the case of Adjustable
Rate Mortgage Loans, against any loss by reason of the invalidity or
unenforceability of the lien resulting from the provisions of the
Mortgage providing for adjustment to the Mortgage Rate and Scheduled
Payment. Where required by state law or regulation, the Mortgagor has
been given the opportunity to choose the carrier of the required
mortgage title insurance. Additionally, such lender's title insurance
policy affirmatively insures ingress and egress, and against
encroachments by or upon the Mortgaged Property or any interest therein.
[___________], its successor and assigns, are the sole insureds of such
lender's title insurance policy, and such lender's title insurance
policy is valid and remains in full force and effect and will be in
force and effect upon the consummation of the transactions contemplated
by this Agreement. No claims have been made under such lender's title
insurance policy, and no prior holder of the related Mortgage, including
[MORTGAGEE] and [___________], has done, by act or omission, anything
which would impair the coverage of such lender's title insurance policy,
including, without limitation, no unlawful fee, commission, kickback or
other unlawful compensation or value of any kind has been or will be
received, retained or realized by any attorney, firm or other person or
entity, and no such unlawful items have been received, retained or
realized by [MORTGAGEE] or [___________];
(17) No Defaults. Other than payments due but not yet 30 or more
days delinquent, there is no default, breach, violation or event which
would permit acceleration existing under the Mortgage or the Mortgage
Note and no event which, with the passage of time or with notice and the
expiration of any grace or cure period, would constitute a default,
breach, violation or event which would permit acceleration, and neither
[___________] nor its Affiliates or any of their respective predecessors
have waived any default, breach, violation or event which would permit
acceleration;
(18) No Mechanics' Liens. As of the date of origination, there are
no mechanics' or similar liens or claims which have been filed for work,
labor or material (and no rights are outstanding that under law could
give rise to such liens) affecting the
S-III-6
related Mortgaged Property which are or may be liens prior to, or equal
or coordinate with, the lien of the related Mortgage;
(19) Location of Improvements; No Encroachments. All improvements
which were considered in determining the Appraised Value of the
Mortgaged Property lay wholly within the boundaries and building
restriction lines of the Mortgaged Property, and no improvements on
adjoining properties encroach upon the Mortgaged Property. No
improvement located on or being part of the Mortgaged Property is in
violation of any applicable zoning law or regulation;
(20) Origination; Payment Terms. Either (a) the Mortgage Loan was
originated by a mortgagee approved by the Secretary of Housing and Urban
Development pursuant to Sections 203 and 211 of the National Housing
Act, a savings and loan association, a savings bank, a commercial bank,
credit union, insurance company or other similar institution which is
supervised and examined by a federal or state authority, or (b) the
following requirements have been met with respect to the Mortgage Loan:
[___________] purchased the Mortgage Loan from [____________], its
affiliate, that meets the requirements set forth in clause (a), and (i)
such Mortgage Loan was underwritten in accordance with standards
established by [MORTGAGEE], using application forms and related credit
documents approved by [MORTGAGEE], (ii) [MORTGAGEE] approved each
application and the related credit documents before a commitment by the
correspondent was issued, and no such commitment was issued until
[MORTGAGEE] agreed to fund such Mortgage Loan, (iii) the closing
documents for such Mortgage Loan were prepared on forms approved by
[MORTGAGEE] and (iv) such Mortgage Loan was actually funded by
[MORTGAGEE] and was purchased by [MORTGAGEE] at closing or soon
thereafter. The documents, instruments and agreements submitted for loan
underwriting were not falsified and contain no untrue statement of
material fact or omit to state a material fact required to be stated
therein or necessary to make the information and statements therein not
misleading. Principal payments on the Mortgage Loan commenced no more
than sixty days after funds were disbursed in connection with the
Mortgage Loan. The Mortgage Rate is as set forth on Mortgage Loan
Schedule hereto (including in the case of Adjustable Rate Mortgage
Loans, the interest rate and payment limitations set forth on Mortgage
Loan Schedule hereto). All Mortgage Loans have Due Dates on the first
day of each month except as specified on the Mortgage Loan Schedule.
Each Mortgage Note is payable in equal monthly installments of principal
and interest, which installments of interest, with respect to Adjustable
Rate Mortgage Loans, are subject to change due to the adjustments to the
Mortgage Rate on each Interest Rate Adjustment Date, with interest
calculated and payable in arrears and is not calculated on a simple
interest basis. The monthly principal payments on each Mortgage Loan is
sufficient to amortize the Mortgage Loan fully by the stated maturity
date, over an original term of not more than thirty years from
commencement of amortization. There is no negative amortization allowed
in the terms of any Mortgage Note. None of the Mortgage Loans allows for
negative amortization or the conversion of the interest rate thereon
from an adjustable rate to a fixed rate or from a fixed rate to an
adjustable rate. No Mortgage Loan is a Balloon Loan;
S-III-7
(21) Customary Provisions. The Mortgage contains customary and
enforceable provisions such as to render the rights and remedies of the
holder thereof adequate for the realization against the Mortgaged
Property of the benefits of the security provided thereby, including,
(i) in the case of a Mortgage designated as a deed of trust, by
trustee's sale, and (ii) otherwise by judicial foreclosure. Upon default
by a Mortgagor on a Mortgage Loan and foreclosure on, or trustee's sale
of, the Mortgaged Property pursuant to the proper procedures, the holder
of the Mortgage Loan will be able to deliver good and merchantable title
to the Mortgaged Property. There is no homestead or other exemption
available to a Mortgagor which would interfere with the right to sell
the Mortgaged Property at a trustee's sale or the right to foreclose the
Mortgage, subject to applicable federal and state laws and judicial
precedent with respect to bankruptcy and right of redemption or similar
law;
(22) Index. With respect to Adjustable Rate Mortgage Loans, the
Index set forth in the Mortgage Note is LIBOR;
(23) Occupancy of the Mortgaged Property. As of the Securitization
Closing Date the Mortgaged Property is lawfully occupied under
applicable law. All inspections, licenses and certificates required to
be made or issued with respect to all occupied portions of the Mortgaged
Property and, with respect to the use and occupancy of the same,
including, but not limited to, certificates of occupancy and fire
underwriting certificates, have been made or obtained from the
appropriate authorities;
(24) No Additional Collateral. The Mortgage Note is not and has not
been secured by any collateral except the lien of the corresponding
Mortgage and the security interest of any applicable security agreement
or chattel mortgage;
(25) Deeds of Trust. In the event the Mortgage constitutes a deed
of trust, a trustee, authorized and duly qualified under applicable law
to serve as such, has been properly designated and currently so serves
and is named in the Mortgage, and no fees or expenses are or will become
payable by the Sponsor to the trustee under the deed of trust, except in
connection with a trustee's sale after default by the Mortgagor;
(26) Delivery of Mortgage Documents. The Mortgage Note, the
Mortgage, the Assignment of Mortgage and any other documents required to
be delivered under this Agreement for each Mortgage Loan have been
delivered to the Sponsor;
(27) Transfer of Mortgage Loans. The Assignment of Mortgage is in
recordable form, other than the assignee's name and recording
information not yet returned from the recording office, and is
acceptable for recording under the laws of the jurisdiction in which the
Mortgaged Property is located. The transfer, assignment and conveyance
of the Mortgage Notes and the Mortgages by [___________] are not subject
to the bulk transfer or similar statutory provisions in effect in any
applicable jurisdiction;
(28) due-on-sale. With respect to each Fixed Rate Mortgage Loan,
the Mortgage contains an enforceable provision for the acceleration of
the payment of the unpaid principal balance of the Mortgage Loan in the
event that the Mortgaged Property
S-III-8
is sold or transferred without the prior written consent of the
mortgagee thereunder, and such provision is enforceable;
(29) No Buydown Provisions No Graduated Payments or Contingent
Interests. The Mortgage Loan does not contain provisions pursuant to
which Scheduled Payments are paid or partially paid with funds deposited
in any separate account established by [___________], the Mortgagor, or
anyone on behalf of the Mortgagor, or paid by any source other than the
Mortgagor nor does it contain any other similar provisions which may
constitute a "buydown" provision. The Mortgage Loan is not a graduated
payment mortgage loan and the Mortgage Loan does not have a shared
appreciation or other contingent interest feature;
(30) Assumability. With respect to each Adjustable Rate Mortgage
Loan, the Mortgage Loan Documents provide that after the related first
Interest Rate Adjustment Date, a related Mortgage Loan may only be
assumed if the party assuming such Mortgage Loan meets certain credit
requirements stated in the Mortgage Loan Documents;
(31) Consolidation of Future Advances. Any future advances made to
the Mortgagor prior to the Cut-off Date have been consolidated with the
outstanding principal amount secured by the Mortgage, and the secured
principal amount, as consolidated, bears a single interest rate and
single repayment term. The lien of the Mortgage securing the
consolidated principal amount is expressly insured as having first lien
priority (with respect to a First Lien Mortgage Loan) or second lien
priority (with respect to a Second Lien Mortgage Loan) by a title
insurance policy, an endorsement to the policy insuring the mortgagee's
consolidated interest or by other title evidence acceptable to ▇▇▇▇▇▇
▇▇▇ and ▇▇▇▇▇▇▇ Mac. The consolidated principal amount does not exceed
the original principal amount of the Mortgage Loan;
(32) Mortgaged Property Undamaged; No Condemnation Proceedings.
There is no proceeding pending or threatened for the total or partial
condemnation of the Mortgaged Property. The Mortgaged Property is
undamaged by waste, fire, earthquake or earth movement, windstorm,
flood, tornado or other casualty so as to affect adversely the value of
the Mortgaged Property as security for the Mortgage Loan or the use for
which the premises were intended and each Mortgaged Property is in good
repair. There have not been any condemnation proceedings with respect to
the Mortgaged Property and [___________] has no knowledge of any such
proceedings in the future;
(33) Collection Practices; Escrow Payments; Interest Rate
Adjustments. The origination, servicing and collection practices used by
[___________] and its Affiliates with respect to the Mortgage Loan have
been in all respects in compliance with Accepted Servicing Practices,
applicable laws and regulations, and have been in all respects legal and
proper. With respect to escrow deposits and Escrow Payments, if any, all
such payments are in the possession of, or under the control of,
[___________] and there exist no deficiencies in connection therewith
for which customary arrangements for repayment thereof have not been
made. All Escrow Payments have been collected in full compliance with
state and federal law and the provisions of the related Mortgage Note
S-III-9
and Mortgage. An escrow of funds is not prohibited by applicable law and
has been established in an amount sufficient to pay for every item that
remains unpaid and has been assessed but is not yet due and payable. No
escrow deposits or Escrow Payments or other charges or payments due
[___________] have been capitalized under the Mortgage or the Mortgage
Note. All Mortgage Rate adjustments have been made in strict compliance
with state and federal law and the terms of the related Mortgage Note.
If, pursuant to the terms of the Mortgage Note, another index was
selected for determining the Mortgage Rate, the same index was used with
respect to each Mortgage Note which required a new index to be selected,
and such selection did not conflict with the terms of the related
Mortgage Note. [___________] or an Affiliate executed and delivered any
and all notices required under applicable law and the terms of the
related Mortgage Note and Mortgage regarding the Mortgage Rate and the
monthly payment adjustments. Any interest required to be paid pursuant
to state, federal and local law has been properly paid and credited;
(34) Other Insurance Policies. No action, inaction or event has
occurred and no state of facts exists or has existed that has resulted
or will result in the exclusion from, denial of, or defense to coverage
under any insurance policy or bankruptcy bond related to the Mortgage
Loans, irrespective of the cause of such failure of coverage. In
connection with the placement of any such insurance, no commission, fee,
or other compensation has been or will be received by [___________] or
by any officer, director, or employee of [___________] or any designee
of [___________] or any corporation in which [___________] or any
officer, director, or employee had a financial interest at the time of
placement of such insurance;
(35) No Violation of Environmental Laws. There is no pending action
or proceeding directly involving the Mortgaged Property in which
compliance with any environmental law, rule or regulation is an issue;
there is no violation of any environmental law, rule or regulation with
respect to the Mortgaged Property; and nothing further remains to be
done to satisfy in full all requirements of each such law, rule or
regulation constituting a prerequisite to use and enjoyment of said
property;
(36) Servicemembers Civil Relief Act. The Mortgagor has not
notified [___________], and [___________] has no knowledge of any relief
requested or allowed to the Mortgagor under the Servicemembers Civil
Relief Act or any similar state statutes;
(37) Appraisal. The Mortgage File contains an appraisal of the
related Mortgaged Property signed by a qualified appraiser, acceptable
to [___________], who had no interest, direct or indirect in the
Mortgaged Property or in any loan made on the security thereof, and
whose compensation is not affected by the approval or disapproval of the
Mortgage Loan, and the appraisal and appraiser both satisfy the
requirements of ▇▇▇▇▇▇ Mae or ▇▇▇▇▇▇▇ Mac and Title XI of the Financial
Institutions Reform, Recovery, and Enforcement Act of 1989 and the
regulations promulgated thereunder, all as in effect on the date the
Mortgage Loan was originated;
(38) Disclosure Materials. The Mortgagor has executed a statement
to the effect that the Mortgagor has received all disclosure materials
required by, and the
S-III-10
originator has complied with all applicable law with respect to the
making of the Mortgage Loans;
(39) Construction or Rehabilitation of Mortgaged Property. No
Mortgage Loan was made in connection with the construction or
rehabilitation of a Mortgaged Property or facilitating the trade-in or
exchange of a Mortgaged Property;
(40) Value of Mortgaged Property. [___________] has no knowledge of
any circumstances existing that could reasonably be expected to
adversely affect the value or the marketability of any Mortgaged
Property or Mortgage Loan or to cause the Mortgage Loans to prepay
during any period materially faster or slower than similar mortgage
loans held by [___________] generally secured by properties in the same
geographic area as the related Mortgaged Property;
(41) No Defense to Insurance Coverage. No action has been taken or
failed to be taken, no event has occurred and no state of facts exists
or has existed on or prior to the Securitization Closing Date (whether
or not known to [___________] on or prior to such date) which has
resulted or will result in an exclusion from, denial of, or defense to
coverage under any primary mortgage insurance (including, without
limitation, any exclusions, denials or defenses which would limit or
reduce the availability of the timely payment of the full amount of the
loss otherwise due thereunder to the insured) whether arising out of
actions, representations, errors, omissions, negligence, or fraud of
[___________], the related Mortgagor or any party involved in the
application for such coverage, including the appraisal, plans and
specifications and other exhibits or documents submitted therewith to
the insurer under such insurance policy, or for any other reason under
such coverage, but not including the failure of such insurer to pay by
reason of such insurer's breach of such insurance policy or such
insurer's financial inability to pay;
(42) Escrow Analysis. With respect to each Mortgage, [___________]
or its Affiliate has within the last twelve months (unless such Mortgage
was originated within such twelve month period) analyzed the required
Escrow Payments for each Mortgage and adjusted the amount of such
payments so that, assuming all required payments are timely made, any
deficiency will be eliminated on or before the first anniversary of such
analysis, or any overage will be refunded to the Mortgagor, in
accordance with RESPA and any other applicable law;
(43) Prior Servicing. Each Mortgage Loan has been serviced in all
material respects in strict compliance with Accepted Servicing
Practices;
(44) Credit Information. As to each consumer report (as defined in
the Fair Credit Reporting Act, Public Law 91-508) or other credit
information furnished by [___________] to the Sponsor, that Seller has
full right and authority and is not precluded by law or contract from
furnishing such information to the Sponsor;
(45) Leaseholds. If the Mortgage Loan is secured by a long-term
residential lease, (1) the lessor under the lease holds a fee simple
interest in the land; (2) the terms of
S-III-11
such lease expressly permit the mortgaging of the leasehold estate, the
assignment of the lease without the lessor's consent and the acquisition
by the holder of the Mortgage of the rights of the lessee upon
foreclosure or assignment in lieu of foreclosure or provide the holder
of the Mortgage with substantially similar protections; (3) the terms of
such lease do not (a) allow the termination thereof upon the lessee's
default without the holder of the Mortgage being entitled to receive
written notice of, and opportunity to cure, such default, (b) allow the
termination of the lease in the event of damage or destruction as long
as the Mortgage is in existence, (c) prohibit the holder of the Mortgage
from being insured (or receiving proceeds of insurance) under the hazard
insurance policy or policies relating to the Mortgaged Property or (d)
permit any increase in rent other than pre-established increases set
forth in the lease; (4) the original term of such lease is not less than
15 years; (5) the term of such lease does not terminate earlier than
five years after the maturity date of the Mortgage Note; and (6) the
Mortgaged Property is located in a jurisdiction in which the use of
leasehold estates in transferring ownership in residential properties is
a generally accepted practice;
(46) Predatory Lending Regulations; High Cost Loans. None of the
Mortgage Loans (a) is covered by the Home Ownership and Equity
Protection Act of 1994 or (b) is classified as a "high cost home,"
"threshold," "covered" (excluding a "covered home loan" as defined in
clause (1) of the definition of such term under the New Jersey Home
Ownership Security Act of 2002), "high risk home", "predatory" or
similar loan under any other applicable federal, state or local law
(including without limitation any regulation or ordinance) (or a
similarly classified loan using different terminology under a law
imposing heightened regulatory scrutiny or additional legal liability
for residential mortgage loans having high interest rates, points and/or
fees) or (c) a Mortgage Loan categorized as "High Cost" or "Covered"
pursuant to Appendix E of the Standard & Poor's Glossary, and no
Mortgage Loan originated on or after October 1, 2002 through March 6,
2003 is governed by the Georgia Fair Lending Act;
(47) Prepayment Penalty. No Mortgage Loan has a prepayment penalty
period in excess of three years. Any prepayment penalty is in an amount
equal to the lesser of (a) the maximum amount permitted under applicable
state law, and (b) if the Mortgaged Property is secured by residential
real property located in a state other than Arizona, Maine,
Massachusetts, New York, South Carolina or Wisconsin, six months
interest on the related prepaid amount;
(48) Conformance with Agency and Underwriting Standards. The
Mortgage Loan was underwritten in accordance with the Underwriting
Guidelines. The Mortgage Note and Mortgage are on forms acceptable to
▇▇▇▇▇▇▇ Mac or ▇▇▇▇▇▇ Mae and neither [___________] nor any Affiliate
has made any representations to a Mortgagor that are inconsistent with
the mortgage instruments used;
(49) Single-Premium Credit Life Insurance Policy. In connection
with the origination of any Mortgage Loan, no proceeds from any Mortgage
Loan were used to finance or acquire a single-premium credit life
insurance policy;
S-III-12
(50) Acceptable Investment. There are no circumstances or
conditions with respect to the Mortgage, the Mortgaged Property, the
Mortgagor, the Mortgage File or the Mortgagor's credit standing that can
reasonably be expected to cause private institutional investors who
invest in mortgage loans similar to the Mortgage Loan to regard the
Mortgage Loan as an unacceptable investment, cause the Mortgage Loan to
become delinquent, or adversely affect the value or marketability of the
Mortgage Loan, or cause the Mortgage Loans to prepay during any period
materially faster or slower than the mortgage loans originated by
[___________] or any Affiliates generally;
(51) Condominiums/Planned Unit Developments. If the Mortgaged
Property is a condominium unit or a planned unit development (other than
a de minimis planned unit development) such condominium or planned unit
development project such Mortgage Loan was originated in accordance
with, and the Mortgaged Property meets the guidelines set forth in the
Originator's Underwriting Guidelines;
(52) Conversion to Fixed Interest Rate. With respect to each
Adjustable Rate Mortgage Loan, the Mortgage Loan is not a Convertible
Mortgage Loan;
(53) Qualified Mortgage. The Mortgage Loan is a "qualified
mortgage" within the meaning of Section 860G(a)(3) of the Code;
(54) Compliance with Anti-Money Laundering Laws. [___________] or
an Affiliate has complied with all applicable anti-money laundering laws
and regulations, including, without limitation, the USA Patriot Act of
2001;
(55) Fair Credit Reporting Act. [___________] or an Affiliate has,
in its capacity as prior servicer for each Mortgage Loan, fully
furnished, in accordance with the Fair Credit Reporting Act and its
implementing regulations, accurate and complete information (e.g.,
favorable and unfavorable) on its borrower credit files to Equifax,
Experian and Trans Union Credit Information Company (three of the credit
repositories), on a monthly basis;
(56) ▇▇▇▇▇▇ ▇▇▇ Guides Anti-Predatory Lending Eligibility. Each
Mortgage Loan is in compliance with the anti-predatory lending
eligibility for purchase requirements of ▇▇▇▇▇▇ Mae Guides;
(57) Mortgagor Selection. No Mortgagor was encouraged or required
to select a Mortgage Loan product offered by the Originator which is a
higher cost product designed for less creditworthy mortgagors, unless at
the time of the Mortgage Loan's origination, such Mortgagor did not
qualify taking into account credit history and debt-to-income ratios for
a lower-cost credit product then offered by the Originator or any
Affiliate of the Originator. If, at the time of loan application, the
Mortgagor may have qualified for a lower-cost credit product then
offered by any mortgage lending Affiliate of the Originator, the
Originator referred the related Mortgagor's application to such
Affiliate for underwriting consideration;
(58) Underwriting Methodology. The methodology used in underwriting
the extension of credit for each Mortgage Loan employs objective
mathematical principles
S-III-13
which relate the related Mortgagor's income, assets and liabilities to
the proposed payment and such underwriting methodology does not rely on
the extent of the related Mortgagor's equity in the collateral as the
principal determining factor in approving such credit extension. Such
underwriting methodology confirmed that at the time of origination
(application/approval) the related Mortgagor had a reasonable ability to
make timely payments on the Mortgage Loan;
(59) Mortgage Loans with Prepayment Premiums. With respect to any
Mortgage Loan that contains a provision permitting imposition of a
premium upon a prepayment prior to maturity: (i) prior to the Mortgage
Loan's origination, the related Mortgagor agreed to such premium in
exchange for a monetary benefit, including but not limited to a rate or
fee reduction, (ii) prior to the Mortgage Loan's origination, the
related Mortgagor was offered the option of obtaining a mortgage loan
that did not require payment of such a premium, (iii) the prepayment
premium is disclosed to the related Mortgagor in the Mortgage Loan
documents pursuant to applicable state and federal law, and (iv)
notwithstanding any state or federal law to the contrary, the
Originator, as servicer, shall not impose such prepayment premium in any
instance when the mortgage debt is accelerated as the result of the
related Mortgagor's default in making the Mortgage Loan payments;
(60) Purchase of Insurance. No Mortgagor was required to purchase
any credit life, disability, accident or health insurance product as a
condition of obtaining the extension of credit. No Mortgagor obtained a
prepaid single-premium credit life, disability, accident or health
insurance policy in connection with the origination of the Mortgage
Loan. No proceeds from any Mortgage Loan were used to purchase single
premium credit insurance policies as part of the origination of, or as a
condition to closing, such Mortgage Loan;
(61) Points and Fees. All points and fees related to each Mortgage
Loan were disclosed in writing to the Mortgagor in accordance with
applicable state and federal law and regulation. Except in the case of a
Mortgage Loan in an original principal amount of less than $[__] which
would have resulted in an unprofitable origination, no Mortgagor was
charged "points and fees" (whether or not financed) in an amount greater
than [__]% of the principal amount of such Mortgage Loan, such [__]%
limitation is calculated in accordance with ▇▇▇▇▇▇ Mae's anti-predatory
lending requirements as set forth in the ▇▇▇▇▇▇ Mae Guides;
(62) Disclosure of Fees and Charges. All fees and charges
(including finance charges), whether or not financed, assessed,
collected or to be collected in connection with the origination and
servicing of each Mortgage Loan, have been disclosed in writing to the
Mortgagor in accordance with applicable state and federal law and
regulation; and
(63) No Arbitration. No Mortgage Loan originated on or after July
1, 2004 requires the related Mortgagor to submit to arbitration to
resolve any dispute arising out of or relating in any way to the
Mortgage Loan transaction.
S-III-14
SCHEDULE IV
▇▇▇▇▇▇ ▇▇▇▇▇▇▇ ABS Capital Inc.
Mortgage Pass-Through Certificates,
Series 2006-[___]
Representations and Warranties as to the Responsible Party
----------------------------------------------------------
[___________] hereby makes the representations and warranties set
forth in this Schedule IV to the Depositor and the Trustee, as of the Closing
Date:
(a) Due Organization and Authority. The Responsible Party is a
corporation duly organized, validly existing and in good standing
under the laws of the state of [STATE] and has all licenses
necessary to carry on its business as now being conducted and is
licensed, qualified and in good standing in each state wherein it
owns or leases any material properties or where a Mortgaged
Property is located, if the laws of such state require licensing or
qualification in order to conduct business of the type conducted by
the Responsible Party, and in any event the Responsible Party is in
compliance with the laws of any such state to the extent necessary;
the Responsible Party has the full corporate power, authority and
legal right to execute and deliver this Agreement and to perform
its obligations hereunder; the execution, delivery and performance
of this Agreement by the Responsible Party and the consummation of
the transactions contemplated hereby have been duly and validly
authorized; this Agreement and all agreements contemplated hereby
have been duly executed and delivered and constitute the valid,
legal, binding and enforceable obligations of the Responsible
Party, regardless of whether such enforcement is sought in a
proceeding in equity or at law; and all requisite corporate action
has been taken by the Responsible Party to make this Agreement and
all agreements contemplated hereby valid and binding upon the
Responsible Party in accordance with their terms;
(b) No Conflicts. Neither the execution and delivery of this Agreement,
the consummation of the transactions contemplated hereby, nor the
fulfillment of or compliance with the terms and conditions of this
Agreement, will conflict with or result in a breach of any of the
terms, conditions or provisions of the Responsible Party's charter
or by-laws or any legal restriction or any agreement or instrument
to which the Responsible Party is now a party or by which it is
bound, or constitute a default or result in an acceleration under
any of the foregoing, or result in the violation of any law, rule,
regulation, order, judgment or decree to which the Responsible
Party or its property is subject, or result in the creation or
imposition of any lien, charge or encumbrance that would have an
adverse effect upon any of its properties pursuant to the terms of
any mortgage, contract, deed of trust or other instrument;
(c) No Litigation Pending. There is no action, suit, proceeding or
investigation pending or threatened against the Responsible Party,
before any court,
S-IV-1
administrative agency or other tribunal asserting the invalidity
of this Agreement, seeking to prevent the consummation of any of
the transactions contemplated by this Agreement or which, either
in any one instance or in the aggregate, may result in any
material adverse change in the business, operations, financial
condition, properties or assets of the Responsible Party, or in
any material impairment of the right or ability of the Responsible
Party to carry on its business substantially as now conducted, or
in any material liability on the part of the Responsible Party, or
which would draw into question the validity of this Agreement or
of any action taken or to be taken in connection with the
obligations of the Responsible Party contemplated herein, or which
would be likely to impair materially the ability of the
Responsible Party to perform under the terms of this Agreement;
and
(d) No Consent Required. No consent, approval, authorization or order
of, or registration or filing with, or notice to any court or
governmental agency or body including HUD, the FHA or the VA is
required for the execution, delivery and performance by the
Responsible Party of or compliance by the Responsible Party with
this Agreement or the consummation of the transactions contemplated
by this Agreement, or if required, such approval has been obtained
prior to the Closing Date.
S-IV-2
SCHEDULE V
▇▇▇▇▇▇ ▇▇▇▇▇▇▇ ABS Capital I Inc.
Mortgage Pass-Through Certificates
Series 2006-[___]
Representations and Warranties of ▇▇▇▇▇▇ ▇▇▇▇▇▇▇ ABS Capital I Inc.
-------------------------------------------------------------------
as to the Mortgage Loans
------------------------
The Depositor hereby makes with respect the Mortgage Loans the
following representations and warranties to the Trustee, as of the Closing
Date:
(1) Immediately prior to the transfer of the Mortgage Loans by the
Depositor to the Trust on the Closing Date, the Depositor had good title
to the Mortgage Loans, free and clear of any liens, charges, claims or
encumbrances whatsoever;
(2) The original loan balance of each Mortgage Loan was within
▇▇▇▇▇▇▇ Mac's and ▇▇▇▇▇▇ Mae's dollar amount limits for conforming one
to four family mortgage loans; and
(3) No Mortgage Loan has a Prepayment Charge period in excess of
three years.
S-V-1
SCHEDULE VI
▇▇▇▇▇▇ ▇▇▇▇▇▇▇ ABS Capital I Inc.
Mortgage Pass Through Certificates,
Series 2006-1
Representations and Warranties of [_________], as Servicer
----------------------------------------------------------
[_________] hereby makes the representations and warranties set forth in
this Schedule VI to the Depositor and the Trustee, as of the Closing Date.
Capitalized terms used but not otherwise defined in this Agreement shall have
the meanings ascribed thereto in the Agreement to which this Schedule IV is
attached.
(1) [_________] is a national banking association duly organized,
validly existing and in good standing under the federal laws of the
United States of America and is duly authorized and qualified to
transact any and all business contemplated by this Pooling and Servicing
Agreement to be conducted by [_________] in any state in which a
Mortgaged Property securing a Mortgage Loan serviced by [_________] is
located or is otherwise not required under applicable law to effect such
qualification and, in any event, is in compliance with the doing
business laws of any such State, to the extent necessary to ensure its
ability to enforce each Mortgage Loan serviced by [_________] and to
service each Mortgage Loan serviced by [_________] in accordance with
the terms of this Pooling and Servicing Agreement;
(2) [_________] has the full power and authority to service each
Mortgage Loan serviced by [_________], and to execute, deliver and
perform, and to enter into and consummate the transactions contemplated
by this Pooling and Servicing Agreement and has duly authorized by all
necessary action on the part of [_________] the execution, delivery and
performance of this Pooling and Servicing Agreement; and this Pooling
and Servicing Agreement, assuming the due authorization, execution and
delivery thereof by the Depositor, the Responsible Party, the other
Servicer and the Trustee, constitutes a legal, valid and binding
obligation of [_________], enforceable against [_________] in accordance
with its terms, except to the extent that (a) the enforceability thereof
may be limited by bankruptcy, insolvency, moratorium, receivership and
other similar laws relating to creditors' rights generally and (b) the
remedy of specific performance and injunctive and other forms of
equitable relief may be subject to the equitable defenses and to the
discretion of the court before which any proceeding therefor may be
brought;
(3) The execution and delivery of this Pooling and Servicing
Agreement by [_________], the servicing of the Mortgage Loans serviced
by [_________] by [_________] hereunder, the consummation by [_________]
of any other of the transactions herein contemplated, and the
fulfillment of or compliance with the terms hereof are in the ordinary
course of business of [_________] and will not (A) result in a breach of
any term or provision of the organizational documents of [_________] or
(B) conflict with, result in a breach, violation or acceleration of, or
result in a default under, the terms of any other material agreement or
instrument to which [_________] is a party
S-VI-1
or by which it may be bound, or any statute, order or regulation
applicable to [_________] of any court, regulatory body, administrative
agency or governmental body having jurisdiction over [_________]; and
[_________] is not a party to, bound by, or in breach or violation of
any indenture or other agreement or instrument, or subject to or in
violation of any statute, order or regulation of any court, regulatory
body, administrative agency or governmental body having jurisdiction
over it, which materially and adversely affects or, to [_________]'s
knowledge, would in the future materially and adversely affect, (x) the
ability of [_________] to perform its obligations under this Pooling and
Servicing Agreement or (y) the business, operations, financial
condition, properties or assets of [_________] taken as a whole;
(4) [_________] is an approved seller/servicer for ▇▇▇▇▇▇ Mae, an
approved servicer for ▇▇▇▇▇▇▇ Mac in good standing and is a HUD approved
non supervised mortgagee;
(5) No litigation is pending against [_________] that would
materially and adversely affect the execution, delivery or
enforceability of this Pooling and Servicing Agreement or the ability of
[_________] to service the Mortgage Loans serviced by [_________] or to
perform any of its other obligations hereunder in accordance with the
terms hereof;
(6) No consent, approval, authorization or order of any court or
governmental agency or body is required for the execution, delivery and
performance by [_________] of, or compliance by [_________] with, this
Pooling and Servicing Agreement or the consummation by [_________] of
the transactions contemplated by this Pooling and Servicing Agreement,
except for such consents, approvals, authorizations or orders, if any,
that have been obtained prior to the Closing Date;
(7) [_________] has the facilities, procedures and experienced
personnel necessary for the sound servicing of mortgage loans of the
same type as the Mortgage Loans serviced by [_________]; and
(8) With respect to each Mortgage Loan serviced by [_________], to
the extent [_________] serviced such Mortgage Loan serviced by
[_________] and to the extent [_________] provided monthly reports to
the three credit repositories, [_________] has fully furnished, in
accordance with the Fair Credit Reporting Act and its implementing
regulations, accurate and complete information (i.e., favorable and
unfavorable) on its borrower credit files to Equifax, Experian, and
Trans Union Credit Information Company (three of the credit
repositories), on a monthly basis.
S-VI-2
EXHIBIT A
Unless this Certificate is presented by an authorized representative of the
Depository Trust Company, a New York corporation ("DTC"), to Issuer or its
agent for registration of transfer, exchange, or payment, and any certificate
issued is registered in the name of Cede & Co. or in such other name as is
requested by an authorized representative of DTC (and any payment is made to
Cede & Co. or to such other entity as is requested by an authorized
representative of DTC), ANY TRANSFER, PLEDGE, OR OTHER USE HEREOF FOR VALUE OR
OTHERWISE BY OR TO ANY PERSON IS WRONGFUL inasmuch as the registered owner
hereof, Cede & Co., has an interest herein.
SOLELY FOR U.S. FEDERAL INCOME TAX PURPOSES, THIS CERTIFICATE REPRESENTS AN
INTEREST IN A "REGULAR INTEREST" IN A "REAL ESTATE MORTGAGE INVESTMENT
CONDUIT," AS THOSE TERMS ARE DEFINED, RESPECTIVELY, IN SECTIONS 860G AND 860D
OF THE INTERNAL REVENUE CODE OF 1986, AS AMENDED (THE "CODE"), AND CERTAIN
OTHER ASSETS.
AS LONG AS THE INTEREST RATE SWAP AGREEMENT IS IN EFFECT, EACH BENEFICIAL
OWNER OF THIS CERTIFICATE, OR ANY INTEREST THEREIN, SHALL BE DEEMED TO HAVE
REPRESENTED THAT EITHER (I) IT IS NOT AN EMPLOYEE BENEFIT PLAN OR ARRANGEMENT
SUBJECT TO SECTION 406 OF ERISA, A PLAN SUBJECT TO SECTION 4975 OF THE CODE OR
A PLAN SUBJECT TO ANY FEDERAL, STATE OR LOCAL LAW ("SIMILAR LAW") MATERIALLY
SIMILAR TO THE FOREGOING PROVISIONS OF ERISA OR THE CODE, NOR A PERSON ACTING
ON BEHALF OF ANY SUCH PLAN OR ARRANGEMENT NOR USING THE ASSETS OF ANY SUCH
PLAN OR ARRANGEMENT OR (II) THE ACQUISITION AND HOLDING OF THIS CERTIFICATE
ARE ELIGIBLE FOR THE EXEMPTIVE RELIEF AVAILABLE UNDER AT LEAST ONE OF
PROHIBITED TRANSACTION CLASS EXEMPTION ("PTCE") 84-14, ▇▇▇▇ ▇▇-▇, ▇▇▇▇ ▇▇-▇,
▇▇▇▇ 95-60 OR PTCE 96-23 OR A COMPARABLE EXEMPTION AVAILABLE UNDER SIMILAR
LAW.
A-1
Certificate No: A-1-[ ]
A-2-[ ]
A-3-[ ]
A-4-[ ]
M-1-[ ]
M-2-[ ]
M-3-[ ]
M-4-[ ]
M-5-[ ]
M-6-[ ]
B-1-[ ]
B-2-[ ]
B-3-[ ]
Cut-off Date: [_______] , 2006
First Distribution Date: [_______] , 2006
Initial Certificate
Balance of this
Certificate
("Denomination"): $[ ]
Initial Certificate A-1 $[_________]
Balances of all A-2 $[_________]
Certificates of this A-3 $[_________]
Class: A-4 $[_________]
M-1 $[_________]
M-2 $[_________]
M-3 $[_________]
M-4 $[_________]
M-5 $[_________]
M-6 $[_________]
B-1 $[_________]
B-2 $[_________]
B-3 $[_________]
CUSIP:
ISIN:
A-2
▇▇▇▇▇▇ ▇▇▇▇▇▇▇ ABS CAPITAL I INC.
▇▇▇▇▇▇ ▇▇▇▇▇▇▇ ABS Capital I Inc. Trust 2006-[___]
Mortgage Pass-Through Certificates, Series 2006-[___]
[Class A-][Class M-][Class B]
evidencing a percentage interest in the distributions
allocable to the Certificates of the above-referenced
Class.
Principal in respect of this Certificate is distributable monthly
as set forth herein. Accordingly, the Certificate Balance at any time may be
less than the Certificate Balance as set forth herein. This Certificate does
not evidence an obligation of, or an interest in, and is not guaranteed by the
Depositor, the Trustee or any other party to the Agreement referred to below
or any of their respective affiliates. Neither this Certificate nor the
Mortgage Loans are guaranteed or insured by any governmental agency or
instrumentality.
This certifies that _____________ is the registered owner of the
Percentage Interest evidenced by this Certificate (obtained by dividing the
denomination of this Certificate by the aggregate of the denominations of all
Certificates of the Class to which this Certificate belongs) in certain
monthly distributions pursuant to a Pooling and Servicing Agreement dated as
of the Cut-off Date specified above (the "Agreement") among ▇▇▇▇▇▇ ▇▇▇▇▇▇▇ ABS
Capital I Inc., as depositor (the "Depositor"), [____________________], as
servicer, [RESPONSIBLE PARTY], [__________________], as a servicer, as
responsible party, and [_______________], as trustee (the "Trustee"). To the
extent not defined herein, the capitalized terms used herein have the meanings
assigned in the Agreement. This Certificate is issued under and is subject to
the terms, provisions and conditions of the Agreement, to which Agreement the
Holder of this Certificate by virtue of the acceptance hereof assents and by
which such Holder is bound.
Reference is hereby made to the further provisions of this
Certificate set forth on the reverse hereof, which further provisions shall
for all purposes have the same effect as if set forth at this place.
This Certificate shall not be entitled to any benefit under the
Agreement or be valid for any purpose unless manually authenticated by an
authorized signatory of the Trustee.
* * *
A-3
IN WITNESS WHEREOF, the Trustee has caused this Certificate to be
duly executed.
Dated:
[_______________],
not in its individual capacity, but solely as
Trustee
By: _________________________________________
Authenticated:
By:________________________________
Authorized Signatory of
[_______________],
not in its individual capacity,
but solely as Trustee
A-4
▇▇▇▇▇▇ ▇▇▇▇▇▇▇ ABS CAPITAL I INC.
▇▇▇▇▇▇ ▇▇▇▇▇▇▇ ABS Capital I Inc. Trust 2006-[___]
Mortgage Pass-Through Certificates
This Certificate is one of a duly authorized issue of Certificates
designated as ▇▇▇▇▇▇ ▇▇▇▇▇▇▇ ABS Capital I Inc. Trust 2006-[___] Mortgage
Pass-Through Certificates, of the Series specified on the face hereof (herein
collectively called the "Certificates"), and representing a beneficial
ownership interest in the Trust Fund created by the Agreement.
The Certificateholder, by its acceptance of this Certificate,
agrees that it will look solely to the funds on deposit in the Distribution
Account for payment hereunder and that the Trustee is not liable to the
Certificateholders for any amount payable under this Certificate or the
Agreement or, except as expressly provided in the Agreement, subject to any
liability under the Agreement.
This Certificate does not purport to summarize the Agreement and
reference is made to the Agreement for the interests, rights and limitations
of rights, benefits, obligations and duties evidenced thereby, and the rights,
duties and immunities of the Trustee.
Pursuant to the terms of the Agreement, a distribution will be made
on the [__] day of each month or, if such a day is not a Business Day, the
Business Day, immediately following (the "Distribution Date"), commencing on
the first Distribution Date specified on the face hereof, to the Person in
whose name this Certificate is registered at the close of business on the
applicable Record Date in an amount equal to the product of the Percentage
Interest evidenced by this Certificate and the amount required to be
distributed to Holders of Certificates of the Class to which this Certificate
belongs on such Distribution Date pursuant to the Agreement. The Record Date
applicable to each Distribution Date is the Business Day immediately preceding
such Distribution Date; provided, however, that for any Definitive
Certificates, the Record Date shall be the last Business Day of the month next
preceding the month of such Distribution Date.
Distributions on this Certificate shall be made by wire transfer of
immediately available funds to the account of the Holder hereof at a bank or
other entity having appropriate facilities therefor, if such Certificateholder
shall have so notified the Trustee in writing at least five Business Days
prior to the related Record Date and such Certificateholder shall satisfy the
conditions to receive such form of payment set forth in the Agreement, or, if
not, by check mailed by first class mail to the address of such
Certificateholder appearing in the Certificate Register. The final
distribution on each Certificate will be made in like manner, but only upon
presentment and surrender of such Certificate at the offices designated by the
Trustee for such purposes, or such other location specified in the notice to
Certificateholders of such final distribution.
The Agreement permits, with certain exceptions therein provided,
the amendment thereof and the modification of the rights and obligations of
the Trustee and the rights of the Certificateholders under the Agreement at
any time by the parties to the Agreement with the consent of the Holders of
Certificates affected by such amendment evidencing the requisite
A-5
Percentage Interest, as provided in the Agreement. Any such consent by the
Holder of this Certificate shall be conclusive and binding on such Holder and
upon all future Holders of this Certificate and of any Certificate issued upon
the transfer hereof or in exchange therefor or in lieu hereof whether or not
notation of such consent is made upon this Certificate. The Agreement also
permits the amendment thereof, in certain limited circumstances, without the
consent of the Holders of any of the Certificates.
As provided in the Agreement and subject to certain limitations
therein set forth, the transfer of this Certificate is registrable in the
Certificate Register of the Trustee upon surrender of this Certificate for
registration of transfer at the offices designated by the Trustee for such
purposes, accompanied by a written instrument of transfer in form satisfactory
to the Trustee duly executed by the holder hereof or such holder's attorney
duly authorized in writing, and thereupon one or more new Certificates of the
same Class in authorized denominations and evidencing the same aggregate
Percentage Interest in the Trust Fund will be issued to the designated
transferee or transferees.
The Certificates are issuable only as registered Certificates
without coupons in denominations specified in the Agreement. As provided in
the Agreement and subject to certain limitations therein set forth,
Certificates are exchangeable for new Certificates of the same Class in
authorized denominations and evidencing the same aggregate Percentage
Interest, as requested by the Holder surrendering the same.
No service charge will be made for any such registration of
transfer or exchange, but the Trustee may require payment of a sum sufficient
to cover any tax or other governmental charge payable in connection therewith.
The Depositor and the Trustee and any agent of the Depositor or the
Trustee may treat the Person in whose name this Certificate is registered as
the owner hereof for all purposes, and neither the Depositor, the Trustee, nor
any such agent shall be affected by any notice to the contrary.
On any Distribution Date on which the aggregate Stated Principal
Balance of the Mortgage Loans is less than or equal to [__]% of the Cut-off
Date Pool Principal Balance, [_______________], will have the option to
repurchase, in whole, from the Trust Fund all remaining Mortgage Loans and all
property acquired in respect of the Mortgage Loans at a purchase price
determined as provided in the Agreement. The obligations and responsibilities
created by the Agreement will terminate as provided in Section 9.01 of the
Agreement.
Any term used herein that is defined in the Agreement shall have
the meaning assigned in the Agreement, and nothing herein shall be deemed
inconsistent with that meaning.
A-6
ASSIGNMENT
FOR VALUE RECEIVED, the undersigned hereby sell(s), assign(s) and transfer(s)
unto
______________________________________________________________________________
______________________________________________________________________________
______________________________________________________________________________
______________________________________________________________________________
(Please print or typewrite name and address including postal zip code of
assignee)
the Percentage Interest evidenced by the within Certificate and hereby
authorizes the transfer of registration of such Percentage Interest to
assignee on the Certificate Register of the Trust Fund.
I (We) further direct the Trustee to issue a new Certificate of a
like denomination and Class, to the above named assignee and deliver such
Certificate to the following address:
______________________________________________________________________________.
Dated:
_________________________________________
Signature by or on behalf of assignor
A-7
DISTRIBUTION INSTRUCTIONS
The assignee should include the following for purposes of
distribution:
Distributions shall be made, by wire transfer or otherwise, in
immediately available funds to _____________________________________________,
______________________________________________________________________________
for the account of____________________________________________________________
account number ________, or, if mailed by check, to Applicable statements
should be mailed to ___________________________________________________________
_______________________________________________________________________________
This information is provided by ___________________________________,
the assignee named above, or
__________________________________________________, as its agent.
A-8
EXHIBIT B
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.
NEITHER THIS CERTIFICATE NOR ANY INTEREST HEREIN MAY BE TRANSFERRED UNLESS THE
TRANSFEREE DELIVERS TO THE TRUSTEE A REPRESENTATION LETTER TO THE EFFECT THAT
SUCH TRANSFEREE IS NOT AN EMPLOYEE BENEFIT PLAN SUBJECT TO TITLE I OF THE
EMPLOYEE RETIREMENT INCOME SECURITY ACT OF 1974, AS AMENDED, ("ERISA"), OR A
PLAN SUBJECT TO SECTION 4975 OF THE CODE OR A PLAN SUBJECT TO MATERIALLY
SIMILAR PROVISIONS OF APPLICABLE FEDERAL, STATE OR LOCAL LAW ("SIMILAR LAW")
OR A PERSON INVESTING ON BEHALF OF OR WITH PLAN ASSETS OF SUCH A PLAN. IN THE
EVENT THAT SUCH REPRESENTATION IS VIOLATED, OR ANY ATTEMPT IS MADE TO TRANSFER
TO A PLAN OR ARRANGEMENT SUBJECT TO SECTION 406 OF ERISA, A PLAN SUBJECT TO
SECTION 4975 OF THE CODE OR A PLAN SUBJECT TO SIMILAR LAW, OR A PERSON ACTING
ON BEHALF OF ANY SUCH PLAN OR ARRANGEMENT OR USING THE ASSETS OF ANY SUCH PLAN
OR ARRANGEMENT, SUCH ATTEMPTED TRANSFER OR ACQUISITION SHALL BE VOID AND OF NO
EFFECT.
Certificate No. : P-1
Cut-off Date : [_______] , 2006
First Distribution : [_______] , 2006
Date
Percentage Interest
of this Certificate
("Denomination") : [___]%
------------
B-1
▇▇▇▇▇▇ ▇▇▇▇▇▇▇ ABS CAPITAL I INC.
▇▇▇▇▇▇ ▇▇▇▇▇▇▇ ABS Capital I Inc. Trust 2006-[___]
Mortgage Pass-Through Certificates, Series 2006-[___]
Class P
evidencing a percentage interest in the distributions
allocable to the Certificates of the above-referenced
Class.
Distributions in respect of this Certificate are distributable
monthly as set forth herein. This Certificate does not evidence an obligation
of, or an interest in, and is not guaranteed by the Depositor, the Trustee or
any other party to the Agreement referred to below or any of their respective
affiliates. Neither this Certificate nor the Mortgage Loans are guaranteed or
insured by any governmental agency or instrumentality.
This certifies that _____________________, is the registered owner
of the Percentage Interest evidenced by this Certificate (obtained by dividing
the denomination of this Certificate by the aggregate of the denominations of
all Certificates of the Class to which this Certificate belongs) in certain
monthly distributions pursuant to a Pooling and Servicing Agreement dated as
of the Cut-off Date specified above (the "Agreement") among ▇▇▇▇▇▇ ▇▇▇▇▇▇▇ ABS
Capital I Inc., as depositor (the "Depositor"), [__________________], as a
servicer, [____________________], as servicer, [___________], as responsible
party, and [_______________], as trustee (the "Trustee"). To the extent not
defined herein, the capitalized terms used herein have the meanings assigned
in the Agreement. This Certificate is issued under and is subject to the
terms, provisions and conditions of the Agreement, to which Agreement the
Holder of this Certificate by virtue of the acceptance hereof assents and by
which such Holder is bound.
This Certificate does not have a Pass-Through Rate and will be
entitled to distributions only to the extent set forth in the Agreement. In
addition, any distribution of the proceeds of any remaining assets of the
Trust will be made only upon presentment and surrender of this Certificate at
the offices designated by the Trustee for such purposes, or such other
location specified in the notice to Certificateholders.
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 "Securities Act"), and any applicable
state securities laws or is made in accordance with the Securities 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 Pooling 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 to the Trustee that such
transfer may be made pursuant to an exemption, describing the applicable
exemption and the basis therefor, from the Securities Act or is being made
pursuant to the Securities Act, which Opinion of Counsel shall be an expense
of the transferor.
B-2
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 Section 406 of ERISA, Section 4975 of the Code or any materially
similar provisions of applicable federal, state or local law ("Similar Law"),
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.
Reference is hereby made to the further provisions of this
Certificate set forth on the reverse hereof, which further provisions shall
for all purposes have the same effect as if set forth at this place.
This Certificate shall not be entitled to any benefit under the
Agreement or be valid for any purpose unless manually authenticated by an
authorized signatory of the Trustee.
* * *
B-3
IN WITNESS WHEREOF, the Trustee has caused this Certificate to be
duly executed.
Dated:
[_______________],
not in its individual capacity, but
solely as Trustee
By: ________________________________________
Authenticated:
By:___________________________
Authorized Signatory of
[_______________],
not in its individual capacity,
but solely as Trustee
B-4
▇▇▇▇▇▇ ▇▇▇▇▇▇▇ ABS CAPITAL I INC.
▇▇▇▇▇▇ ▇▇▇▇▇▇▇ ABS Capital I Inc. Trust 2006-[___]
Mortgage Pass-Through Certificates
This Certificate is one of a duly authorized issue of Certificates
designated as ▇▇▇▇▇▇ ▇▇▇▇▇▇▇ ABS Capital I Inc. Trust 2006-[___] Mortgage
Pass-Through Certificates, of the Series specified on the face hereof (herein
collectively called the "Certificates"), and representing a beneficial
ownership interest in the Trust Fund created by the Agreement.
The Certificateholder, by its acceptance of this Certificate,
agrees that it will look solely to the funds on deposit in the Distribution
Account for payment hereunder and that the Trustee is not liable to the
Certificateholders for any amount payable under this Certificate or the
Agreement or, except as expressly provided in the Agreement, subject to any
liability under the Agreement.
This Certificate does not purport to summarize the Agreement and
reference is made to the Agreement for the interests, rights and limitations
of rights, benefits, obligations and duties evidenced thereby, and the rights,
duties and immunities of the Trustee.
Pursuant to the terms of the Agreement, a distribution will be made
on the [__] day of each month or, if such a day is not a Business Day, the
Business Day immediately following (the "Distribution Date"), commencing on
the first Distribution Date specified on the face hereof, to the Person in
whose name this Certificate is registered at the close of business on the
applicable Record Date in an amount equal to the product of the Percentage
Interest evidenced by this Certificate and the amount required to be
distributed to Holders of Certificates of the Class to which this Certificate
belongs on such Distribution Date pursuant to the Agreement. The Record Date
applicable to each Distribution Date is the last Business Day of the month
next preceding the month of such Distribution Date.
Distributions on this Certificate shall be made by wire transfer of
immediately available funds to the account of the Holder hereof at a bank or
other entity having appropriate facilities therefor, if such Certificateholder
shall have so notified the Trustee in writing at least five Business Days
prior to the related Record Date and such Certificateholder shall satisfy the
conditions to receive such form of payment set forth in the Agreement, or, if
not, by check mailed by first class mail to the address of such
Certificateholder appearing in the Certificate Register. The final
distribution on each Certificate will be made in like manner, but only upon
presentment and surrender of such Certificate at the offices designated by the
Trustee for such purposes or such other location specified in the notice to
Certificateholders of such final distribution.
The Agreement permits, with certain exceptions therein provided,
the amendment thereof and the modification of the rights and obligations of
the Trustee and the rights of the Certificateholders under the Agreement at
any time by the parties to the Agreement with the consent of the Holders of
Certificates affected by such amendment evidencing the requisite Percentage
Interest, as provided in the Agreement. Any such consent by the Holder of this
Certificate shall be conclusive and binding on such Holder and upon all future
Holders of this Certificate and of any Certificate issued upon the transfer
hereof or in exchange therefor or in
B-6
lieu hereof whether or not notation of such consent is made upon this
Certificate. The Agreement also permits the amendment thereof, in certain
limited circumstances, without the consent of the Holders of any of the
Certificates.
As provided in the Agreement and subject to certain limitations
therein set forth, the transfer of this Certificate is registrable in the
Certificate Register of the Trustee upon surrender of this Certificate for
registration of transfer at the offices designated by the Trustee for such
purposes, accompanied by a written instrument of transfer in form satisfactory
to the Trustee duly executed by the holder hereof or such holder's attorney
duly authorized in writing, and thereupon one or more new Certificates of the
same Class in authorized denominations and evidencing the same aggregate
Percentage Interest in the Trust Fund will be issued to the designated
transferee or transferees.
The Certificates are issuable only as registered Certificates
without coupons in denominations specified in the Agreement. As provided in
the Agreement and subject to certain limitations therein set forth,
Certificates are exchangeable for new Certificates of the same Class in
authorized denominations and evidencing the same aggregate Percentage
Interest, as requested by the Holder surrendering the same.
No service charge will be made for any such registration of
transfer or exchange, but the Trustee may require payment of a sum sufficient
to cover any tax or other governmental charge payable in connection therewith.
The Depositor and the Trustee and any agent of the Depositor or the
Trustee may treat the Person in whose name this Certificate is registered as
the owner hereof for all purposes, and neither the Depositor, the Trustee, nor
any such agent shall be affected by any notice to the contrary.
On any Distribution Date on which the aggregate Stated Principal
Balance of the Mortgage Loans is less than or equal to [__]% of the Cut-off
Date Pool Principal Balance, [________________], will have the option to
repurchase, in whole, from the Trust Fund all remaining Mortgage Loans and all
property acquired in respect of the Mortgage Loans at a purchase price
determined as provided in the Agreement. The obligations and responsibilities
created by the Agreement will terminate as provided in Section 9.01 of the
Agreement.
Any term used herein that is defined in the Agreement shall have
the meaning assigned in the Agreement, and nothing herein shall be deemed
inconsistent with that meaning.
B-6
ASSIGNMENT
FOR VALUE RECEIVED, the undersigned hereby sell(s), assign(s) and
transfer(s) unto______________________________________________________________
______________________________________________________________________________
______________________________________________________________________________
______________________________________________________________________________
(Please print or typewrite name and address including postal zip code of
assignee)
the Percentage Interest evidenced by the within Certificate and hereby
authorizes the transfer of registration of such Percentage Interest to
assignee on the Certificate Register of the Trust Fund.
I (We) further direct the Trustee to issue a new Certificate of a
like denomination and Class, to the above named assignee and deliver such
Certificate to the following address:
Dated:
_________________________________________
Signature by or on behalf of assignor
B-7
DISTRIBUTION INSTRUCTIONS
The assignee should include the following for purposes of distribution:
Distributions shall be made, by wire transfer or otherwise, in
immediately available funds to ______________________________________________,
_____________________________________________________________________________,
for the account of __________________________________________________________,
account number ________, or, if mailed by check, to _________________________.
Applicable statements should be mailed to ___________________________________,
_____________________________________________________________________________.
This information is provided by _______________________________,
the assignee named above, or ________________________________________________,
as its agent.
B-8
EXHIBIT C
SOLELY FOR U.S. FEDERAL INCOME TAX PURPOSES, THIS CERTIFICATE IS A "RESIDUAL
INTEREST" IN FOUR "REAL ESTATE MORTGAGE INVESTMENT CONDUITS," AS THOSE TERMS
ARE DEFINED, RESPECTIVELY, IN SECTIONS 860G AND 860D OF THE INTERNAL REVENUE
CODE OF 1986, AS AMENDED (THE "CODE").
NEITHER THIS CERTIFICATE NOR ANY INTEREST HEREIN MAY BE TRANSFERRED UNLESS THE
PROPOSED TRANSFEREE DELIVERS TO THE TRUSTEE A TRANSFER AFFIDAVIT IN ACCORDANCE
WITH THE PROVISIONS OF THE AGREEMENT REFERRED TO HEREIN.
NEITHER THIS CERTIFICATE NOR ANY INTEREST HEREIN MAY BE TRANSFERRED (I) TO A
PERSON OTHER THAN A PERMITTED TRANSFEREE IN COMPLIANCE WITH SECTION 5.02(C) OF
THE AGREEMENT OR (II) UNLESS THE TRANSFEREE DELIVERS TO THE TRUSTEE A
REPRESENTATION LETTER TO THE EFFECT THAT SUCH TRANSFEREE IS NOT AN EMPLOYEE
BENEFIT PLAN SUBJECT TO TITLE I OF THE EMPLOYEE RETIREMENT INCOME SECURITY ACT
OF 1974, AS AMENDED ("ERISA"), OR A PLAN SUBJECT TO SECTION 4975 OF THE CODE
OR A PLAN SUBJECT TO MATERIALLY SIMILAR PROVISIONS OF APPLICABLE FEDERAL,
STATE OR LOCAL LAW ("SIMILAR LAW") OR A PERSON INVESTING ON BEHALF OF OR WITH
PLAN ASSETS OF SUCH A PLAN. IN THE EVENT THAT SUCH REPRESENTATION IS VIOLATED,
OR ANY ATTEMPT IS MADE TO TRANSFER TO A PLAN OR ARRANGEMENT SUBJECT TO SECTION
406 OF ERISA, A PLAN SUBJECT TO SECTION 4975 OF THE CODE OR A PLAN SUBJECT TO
SIMILAR LAW, OR A PERSON ACTING ON BEHALF OF ANY SUCH PLAN OR ARRANGEMENT OR
USING THE ASSETS OF ANY SUCH PLAN OR ARRANGEMENT, SUCH ATTEMPTED TRANSFER OR
ACQUISITION SHALL BE VOID AND OF NO EFFECT.
Certificate No. : R-1
Cut-off Date : [_______] , 2006
First Distribution Date : [_______] , 2006
Percentage Interest of :
this Certificate
("Denomination") 100%
C-1
▇▇▇▇▇▇ ▇▇▇▇▇▇▇ ABS CAPITAL I INC.
▇▇▇▇▇▇ ▇▇▇▇▇▇▇ ABS Capital I Inc. Trust 2006-[___]
Mortgage Pass-Through Certificates, Series 2006-[___]
Class R
evidencing a percentage interest in the distributions
allocable to the Certificates of the above-referenced
Class.
Distributions in respect of this Certificate is distributable
monthly as set forth herein. This Class R Certificate has no Certificate
Balance and is not entitled to distributions in respect of principal or
interest. This Certificate does not evidence an obligation of, or an interest
in, and is not guaranteed by the Depositor, the Trustee or any other party to
the Agreement referred to below or any of their respective affiliates. Neither
this Certificate nor the Mortgage Loans are guaranteed or insured by any
governmental agency or instrumentality.
This certifies that ______________________ is the registered owner
of the Percentage Interest specified above of any monthly distributions due to
the Class R Certificates pursuant to a Pooling and Servicing Agreement dated
as of the Cut-off Date specified above (the "Agreement") among ▇▇▇▇▇▇ ▇▇▇▇▇▇▇
ABS Capital I Inc., as depositor (the "Depositor"), [__________________], as
servicer, [____________________], as servicer, [___________], as responsible
party, and [_______________], as trustee (the "Trustee"). To the extent not
defined herein, the capitalized terms used herein have the meanings assigned
in the Agreement. This Certificate is issued under and is subject to the
terms, provisions and conditions of the Agreement, to which Agreement the
Holder of this Certificate by virtue of the acceptance hereof assents and by
which such Holder is bound.
Any distribution of the proceeds of any remaining assets of the
Trust Fund will be made only upon presentment and surrender of this Class R
Certificate at the offices designated by the Trustee for such purposes or such
other location specified in the notice to Certificateholders.
No transfer of a Class R Certificate 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 or
arrangement subject to Section 406 of ERISA, a plan or arrangement subject to
Section 4975 of the Code or a plan subject to Similar Law, or 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, which representation letter shall
not be an expense of the Trustee, the Servicers or the Trust Fund. In the
event that such representation is violated, or any attempt is made to transfer
to a plan or arrangement subject to Section 406 of ERISA or a plan subject to
Section 4975 of the Code or a plan subject to Similar Law, or a person acting
on behalf of any such plan or arrangement or using the assets of any such plan
or arrangement, such attempted transfer or acquisition shall be void and of no
effect.
C-2
Each Holder of this Class R Certificate shall be deemed by the
acceptance or acquisition an Ownership Interest in this Class R Certificate to
have agreed to be bound by the following provisions, and the rights of each
Person acquiring any Ownership Interest in this Class R Certificate are
expressly subject to the following provisions: (i) each Person holding or
acquiring any Ownership Interest in this Class R 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 this Class R Certificate may be registered on the Closing Date or
thereafter transferred, and the Trustee shall not register the Transfer of
this Certificate unless, in addition to the certificates required to be
delivered to the Trustee under Section 5.02(b) of the Agreement, the Trustee
shall have been furnished with a Transfer Affidavit of the initial owner or
the proposed transferee in the form attached as Exhibit G to the Agreement,
(iii) each Person holding or acquiring any Ownership Interest in this Class R
Certificate shall agree (A) to obtain a Transfer Affidavit from any other
Person to whom such Person attempts to Transfer its Ownership Interest this
Class R 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 this Class R Certificate, (C) not to cause income with respect to
the Class R Certificate to be attributable to a foreign permanent
establishment or fixed base, within the meaning of an applicable income tax
treaty, of such Person or any other U.S. Person and (D) not to Transfer the
Ownership Interest in this Class R Certificate or to cause the Transfer of the
Ownership Interest in this Class R Certificate to any other Person if it has
actual knowledge that such Person is a Non-Permitted Transferee and (iv) any
attempted or purported Transfer of the Ownership Interest in this Class R
Certificate in violation of the provisions herein shall be absolutely null and
void and shall vest no rights in the purported Transferee.
Reference is hereby made to the further provisions of this
Certificate set forth on the reverse hereof, which further provisions shall
for all purposes have the same effect as if set forth at this place.
This Certificate shall not be entitled to any benefit under the
Agreement or be valid for any purpose unless manually authenticated by an
authorized signatory of the Trustee.
* * *
C-3
IN WITNESS WHEREOF, the Trustee has caused this Certificate to be
duly executed.
Dated:
[_______________],
not in its individual capacity, but
solely as Trustee
By: _______________________________________
Authenticated:
By: ______________________________
Authorized Signatory of
[_________________],
not in its individual capacity,
but solely as Trustee
C-4
▇▇▇▇▇▇ ▇▇▇▇▇▇▇ ABS Capital I Inc. Trust 2006-[___]
Mortgage Pass-Through Certificates
This Certificate is one of a duly authorized issue of Certificates
designated as ▇▇▇▇▇▇ ▇▇▇▇▇▇▇ ABS Capital I Inc. Trust 2006-[___] Mortgage
Pass-Through Certificates, of the Series specified on the face hereof (herein
collectively called the "Certificates"), and representing a beneficial
ownership interest in the Trust Fund created by the Agreement.
The Certificateholder, by its acceptance of this Certificate,
agrees that it will look solely to the funds on deposit in the Distribution
Account for payment hereunder and that the Trustee is not liable to the
Certificateholders for any amount payable under this Certificate or the
Agreement or, except as expressly provided in the Agreement, subject to any
liability under the Agreement.
This Certificate does not purport to summarize the Agreement and
reference is made to the Agreement for the interests, rights and limitations
of rights, benefits, obligations and duties evidenced thereby, and the rights,
duties and immunities of the Trustee.
Pursuant to the terms of the Agreement, a distribution will be made
on the [__] day of each month or, if such a day is not a Business Day, the
Business Day immediately following (the "Distribution Date"), commencing on
the first Distribution Date specified on the face hereof, to the Person in
whose name this Certificate is registered at the close of business on the
applicable Record Date in an amount equal to the product of the Percentage
Interest evidenced by this Certificate and the amount required to be
distributed to Holders of Certificates of the Class to which this Certificate
belongs on such Distribution Date pursuant to the Agreement. The Record Date
applicable to each Distribution Date is the last Business Day of the month
next preceding the month of such Distribution Date.
Distributions on this Certificate shall be made by wire transfer of
immediately available funds to the account of the Holder hereof at a bank or
other entity having appropriate facilities therefor, if such Certificateholder
shall have so notified the Trustee in writing at least five Business Days
prior to the related Record Date and such Certificateholder shall satisfy the
conditions to receive such form of payment set forth in the Agreement, or, if
not, by check mailed by first class mail to the address of such
Certificateholder appearing in the Certificate Register. The final
distribution on each Certificate will be made in like manner, but only upon
presentment and surrender of such Certificate at the offices designated by the
Trustee for such purposes or such other location specified in the notice to
Certificateholders of such final distribution.
The Agreement permits, with certain exceptions therein provided,
the amendment thereof and the modification of the rights and obligations of
the Trustee and the rights of the Certificateholders under the Agreement at
any time by the parties to the Agreement with the consent of the Holders of
Certificates affected by such amendment evidencing the requisite Percentage
Interest, as provided in the Agreement. Any such consent by the Holder of this
Certificate shall be conclusive and binding on such Holder and upon all future
Holders of this Certificate and of any Certificate issued upon the transfer
hereof or in exchange therefor or in lieu hereof whether or not notation of
such consent is made upon this Certificate. The
C-5
Agreement also permits the amendment thereof, in certain limited
circumstances, without the consent of the Holders of any of the Certificates.
As provided in the Agreement and subject to certain limitations
therein set forth, the transfer of this Certificate is registrable in the
Certificate Register of the Trustee upon surrender of this Certificate for
registration of transfer at the offices designated by the Trustee for such
purposes, accompanied by a written instrument of transfer in form satisfactory
to the Trustee duly executed by the holder hereof or such holder's attorney
duly authorized in writing, and thereupon one or more new Certificates of the
same Class in authorized denominations and evidencing the same aggregate
Percentage Interest in the Trust Fund will be issued to the designated
transferee or transferees.
The Certificates are issuable only as registered Certificates
without coupons in denominations specified in the Agreement. As provided in
the Agreement and subject to certain limitations therein set forth,
Certificates are exchangeable for new Certificates of the same Class in
authorized denominations and evidencing the same aggregate Percentage
Interest, as requested by the Holder surrendering the same.
No service charge will be made for any such registration of
transfer or exchange, but the Trustee may require payment of a sum sufficient
to cover any tax or other governmental charge payable in connection therewith.
The Depositor and the Trustee and any agent of the Depositor or the
Trustee may treat the Person in whose name this Certificate is registered as
the owner hereof for all purposes, and neither the Depositor, the Trustee, nor
any such agent shall be affected by any notice to the contrary.
On any Distribution Date on which the aggregate Stated Principal
Balance of the Mortgage Loans is less than or equal to [__]% of the Cut-off
Date Pool Principal Balance, [____________________], will have the option to
repurchase, in whole, from the Trust Fund all remaining Mortgage Loans and all
property acquired in respect of the Mortgage Loans at a purchase price
determined as provided in the Agreement. The obligations and responsibilities
created by the Agreement will terminate as provided in Section 9.01 of the
Agreement.
Any term used herein that is defined in the Agreement shall have
the meaning assigned in the Agreement, and nothing herein shall be deemed
inconsistent with that meaning.
C-6
ASSIGNMENT
FOR VALUE RECEIVED, the undersigned hereby sell(s), assign(s) and
transfer(s) unto _____________________________________________________________
______________________________________________________________________________
______________________________________________________________________________
______________________________________________________________________________
(Please print or typewrite name and address including postal zip code of
assignee)
the Percentage Interest evidenced by the within Certificate and hereby
authorizes the transfer of registration of such Percentage Interest to
assignee on the Certificate Register of the Trust Fund.
I (We) further direct the Trustee to issue a new Certificate of a
like denomination and Class, to the above named assignee and deliver such
Certificate to the following address:
____________________________________________________________________________.
Dated:
________________________________________
Signature by or on behalf of assignor
C-7
DISTRIBUTION INSTRUCTIONS
The assignee should include the following for purposes of
distribution:
Distributions shall be made, by wire transfer or otherwise, in
immediately available funds to ______________________________________________,
______________________________________________________________________________,
for the account of
___________________________________________________________, account number
_________________, or, if mailed by check, to _________________,
______________________________________________________________________________.
Applicable statements should be mailed to
____________________________________,
_________________________________________________________________________.
This information is provided by ___________________________________,
the assignee named above, or _________________________________________________,
as its agent.
C-8
EXHIBIT D
SOLELY FOR U.S. FEDERAL INCOME TAX PURPOSES, THIS CERTIFICATE REPRESENTS AN
INTEREST IN TWO "REGULAR INTERESTS" IN A "REAL ESTATE MORTGAGE INVESTMENT
CONDUIT," AS THOSE TERMS ARE DEFINED, RESPECTIVELY, IN SECTIONS 860G AND 860D
OF THE INTERNAL REVENUE CODE OF 1986, AS AMENDED (THE "CODE"), AND CERTAIN
OTHER ASSETS.
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.
NEITHER THIS CERTIFICATE NOR ANY INTEREST HEREIN MAY BE TRANSFERRED UNLESS THE
TRANSFEREE DELIVERS TO THE TRUSTEE EITHER A REPRESENTATION LETTER TO THE
EFFECT THAT SUCH TRANSFEREE IS NOT AN EMPLOYEE BENEFIT PLAN SUBJECT TO TITLE I
OF THE EMPLOYEE RETIREMENT INCOME SECURITY ACT OF 1974, AS AMENDED ("ERISA"),
OR A PLAN SUBJECT TO SECTION 4975 OF THE CODE, OR A PLAN SUBJECT TO APPLICABLE
FEDERAL, STATE OR LOCAL LAW ("SIMILAR LAW") MATERIALLY SIMILAR TO THE
FOREGOING PROVISIONS OF ERISA OR THE CODE OR A PERSON INVESTING ON BEHALF OF
OR WITH PLAN ASSETS OF SUCH A PLAN, OR, IF THE TRANSFEREE IS AN INSURANCE
COMPANY, A REPRESENTATION LETTER THAT IT IS USING THE ASSETS OF ITS GENERAL
ACCOUNT AND THAT THE PURCHASE AND HOLDING OF THIS CERTIFICATE ARE COVERED
UNDER SECTIONS I AND III OF PROHIBITED TRANSACTION CLASS EXEMPTION 95-60 OR AN
OPINION OF COUNSEL SATISFACTORY TO THE TRUSTEE, TO THE EFFECT THAT THE
PURCHASE OR HOLDING OF THIS CERTIFICATE WILL NOT CONSTITUTE OR RESULT IN A
NON-EXEMPT PROHIBITED TRANSACTION WITHIN THE MEANING OF ERISA, SECTION 4975 OF
THE CODE OR ANY SIMILAR LAW AND WILL NOT SUBJECT THE TRUSTEE, THE DEPOSITOR OR
THE SERVICERS TO ANY OBLIGATION IN ADDITION TO THOSE EXPRESSLY UNDERTAKEN IN
THE AGREEMENT OR TO ANY LIABILITY. NOTWITHSTANDING ANYTHING ELSE TO THE
CONTRARY HEREIN, ANY PURPORTED TRANSFER OF THIS CERTIFICATE TO OR ON BEHALF OF
AN EMPLOYEE BENEFIT PLAN SUBJECT TO TITLE I OF ERISA, SECTION 4975 OF THE CODE
OR SIMILAR LAW WITHOUT THE REPRESENTATION LETTER OR OPINION OF COUNSEL
SATISFACTORY TO THE TRUSTEE AS DESCRIBED ABOVE SHALL BE VOID AND OF NO EFFECT.
D-1
Certificate No. : X-1
Cut-off Date : [_______] , 2006
First Distribution Date : [_______] , 2006
Percentage Interest of
this Certificate
("Denomination") : [__]%
D-2
▇▇▇▇▇▇ ▇▇▇▇▇▇▇ ABS CAPITAL I INC.
▇▇▇▇▇▇ ▇▇▇▇▇▇▇ ABS Capital I Inc. Trust 2006-[___]
Mortgage Pass-Through Certificates, Series 2006-[___]
Class X
evidencing a percentage interest in the distributions
allocable to the Certificates of the above-referenced
Class.
Distributions in respect of this Certificate are distributable
monthly as set forth herein. This Certificate does not evidence an obligation
of, or an interest in, and is not guaranteed by the Depositor, the Trustee or
any other party to the Agreement referred to below or any of their respective
affiliates. Neither this Certificate nor the Mortgage Loans are guaranteed or
insured by any governmental agency or instrumentality.
This certifies that ___________________________, is the registered
owner of the Percentage Interest evidenced by this Certificate (obtained by
dividing the denomination of this Certificate by the aggregate of the
denominations of all Certificates of the Class to which this Certificate
belongs) in certain monthly distributions pursuant to a Pooling and Servicing
Agreement dated as of the Cut-off Date specified above (the "Agreement") among
▇▇▇▇▇▇ ▇▇▇▇▇▇▇ ABS Capital I Inc., as depositor (the "Depositor"),
[__________________], as servicer, [___________], as responsible party, and
[_______________], as trustee (the "Trustee"). To the extent not defined
herein, the capitalized terms used herein have the meanings assigned in the
Agreement. This Certificate is issued under and is subject to the terms,
provisions and conditions of the Agreement, to which Agreement the Holder of
this Certificate by virtue of the acceptance hereof assents and by which such
Holder is bound.
This Certificate does not have a Certificate Balance or
Pass-Through Rate and will be entitled to distributions only to the extent set
forth in the Agreement. In addition, any distribution of the proceeds of any
remaining assets of the Trust will be made only upon presentment and surrender
of this Certificate at the offices designated by the Trustee for such purposes
or such other location specified in the notice to Certificateholders.
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 "Securities Act"), and any applicable
state securities laws or is made in accordance with the Securities 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 Pooling 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 to the Trustee that such
transfer may be made pursuant to an exemption, describing the applicable
exemption and the basis therefor, from the Securities Act or is being made
pursuant to the Securities 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 either (i) a representation letter from the
transferee of such Certificate, acceptable
D-3
to and in form and substance satisfactory to the Trustee, to the effect that
such transferee is not an employee benefit plan subject to Section 406 of
ERISA or Section 4975 of the Code or any materially similar provisions of
applicable Federal, state or local law ("Similar Law") 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 (ii) if the transferee is an
insurance company, a representation letter that it is purchasing such
Certificates with the assets of its general account and that the purchase and
holding of such Certificates are covered under Sections I and III of PTCE
95-60, or (iii) in the case of a Certificate presented for registration in the
name of an employee benefit plan subject to ERISA, or a plan or arrangement
subject to Section 4975 of the Code (or comparable provisions of any
subsequent enactments) or a plan subject to Similar Law, 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, 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 will not
constitute or result in a non-exempt prohibited transaction within the meaning
of ERISA, Section 4975 of the Code or any Similar Law and will not subject the
Depositor, the Trustee or the Servicers to any obligation in addition to those
expressly undertaken in the Agreement or to any liability.
Reference is hereby made to the further provisions of this
Certificate set forth on the reverse hereof, which further provisions shall
for all purposes have the same effect as if set forth at this place.
This Certificate shall not be entitled to any benefit under the
Agreement or be valid for any purpose unless manually authenticated by an
authorized signatory of the Trustee.
* * *
D-4
IN WITNESS WHEREOF, the Trustee has caused this Certificate to be
duly executed.
Dated:
[_______________],
not in its individual capacity, but
solely as Trustee
By: _____________________________________
Authenticated:
By: ______________________________
Authorized Signatory of
[_______________],
not in its individual capacity,
but solely as Trustee
D-5
▇▇▇▇▇▇ ▇▇▇▇▇▇▇ ABS CAPITAL I INC.
▇▇▇▇▇▇ ▇▇▇▇▇▇▇ ABS Capital I Inc. Trust 2006-[___]
Mortgage Pass-Through Certificates
This Certificate is one of a duly authorized issue of Certificates
designated as ▇▇▇▇▇▇ ▇▇▇▇▇▇▇ ABS Capital I Inc. Trust 2006-[___] Mortgage
Pass-Through Certificates, of the Series specified on the face hereof (herein
collectively called the "Certificates"), and representing a beneficial
ownership interest in the Trust Fund created by the Agreement.
The Certificateholder, by its acceptance of this Certificate,
agrees that it will look solely to the funds on deposit in the Distribution
Account for payment hereunder and that the Trustee is not liable to the
Certificateholders for any amount payable under this Certificate or the
Agreement or, except as expressly provided in the Agreement, subject to any
liability under the Agreement.
This Certificate does not purport to summarize the Agreement and
reference is made to the Agreement for the interests, rights and limitations
of rights, benefits, obligations and duties evidenced thereby, and the rights,
duties and immunities of the Trustee.
Pursuant to the terms of the Agreement, a distribution will be made
on the [__] day of each month or, if such a day is not a Business Day, the
Business Day immediately following (the "Distribution Date"), commencing on
the first Distribution Date specified on the face hereof, to the Person in
whose name this Certificate is registered at the close of business on the
applicable Record Date in an amount equal to the product of the Percentage
Interest evidenced by this Certificate and the amount required to be
distributed to Holders of Certificates of the Class to which this Certificate
belongs on such Distribution Date pursuant to the Agreement. The Record Date
applicable to each Distribution Date is the last Business Day of the month
next preceding the month of such Distribution Date.
Distributions on this Certificate shall be made by wire transfer of
immediately available funds to the account of the Holder hereof at a bank or
other entity having appropriate facilities therefor, if such Certificateholder
shall have so notified the Trustee in writing at least five Business Days
prior to the related Record Date and such Certificateholder shall satisfy the
conditions to receive such form of payment set forth in the Agreement, or, if
not, by check mailed by first class mail to the address of such
Certificateholder appearing in the Certificate Register. The final
distribution on each Certificate will be made in like manner, but only upon
presentment and surrender of such Certificate at the offices designated by the
Trustee for such purposes or such other location specified in the notice to
Certificateholders of such final distribution.
The Agreement permits, with certain exceptions therein provided,
the amendment thereof and the modification of the rights and obligations of
the Trustee and the rights of the Certificateholders under the Agreement at
any time by the parties to the Agreement with the consent of the Holders of
Certificates affected by such amendment evidencing the requisite Percentage
Interest, as provided in the Agreement. Any such consent by the Holder of this
Certificate shall be conclusive and binding on such Holder and upon all future
Holders of this Certificate and of any Certificate issued upon the transfer
hereof or in exchange therefor or in
D-6
lieu hereof whether or not notation of such consent is made upon this
Certificate. The Agreement also permits the amendment thereof, in certain
limited circumstances, without the consent of the Holders of any of the
Certificates.
As provided in the Agreement and subject to certain limitations
therein set forth, the transfer of this Certificate is registrable in the
Certificate Register of the Trustee upon surrender of this Certificate for
registration of transfer at the offices designated by the Trustee for such
purposes, accompanied by a written instrument of transfer in form satisfactory
to the Trustee duly executed by the holder hereof or such holder's attorney
duly authorized in writing, and thereupon one or more new Certificates of the
same Class in authorized denominations and evidencing the same aggregate
Percentage Interest in the Trust Fund will be issued to the designated
transferee or transferees.
The Certificates are issuable only as registered Certificates
without coupons in denominations specified in the Agreement. As provided in
the Agreement and subject to certain limitations therein set forth,
Certificates are exchangeable for new Certificates of the same Class in
authorized denominations and evidencing the same aggregate Percentage
Interest, as requested by the Holder surrendering the same.
No service charge will be made for any such registration of
transfer or exchange, but the Trustee may require payment of a sum sufficient
to cover any tax or other governmental charge payable in connection therewith.
The Depositor and the Trustee and any agent of the Depositor or the
Trustee may treat the Person in whose name this Certificate is registered as
the owner hereof for all purposes, and neither the Depositor, the Trustee, nor
any such agent shall be affected by any notice to the contrary.
On any Distribution Date on which the aggregate Stated Principal
Balance of the Mortgage Loans is less than or equal to [__]% of the Cut-off
Date Pool Principal Balance, [____________________], will have the option to
repurchase, in whole, from the Trust Fund all remaining Mortgage Loans and all
property acquired in respect of the Mortgage Loans at a purchase price
determined as provided in the Agreement. The obligations and responsibilities
created by the Agreement will terminate as provided in Section 9.01 of the
Agreement.
Any term used herein that is defined in the Agreement shall have
the meaning assigned in the Agreement, and nothing herein shall be deemed
inconsistent with that meaning.
D-7
ASSIGNMENT
FOR VALUE RECEIVED, the undersigned hereby sell(s), assign(s) and
transfer(s) unto ______________________________________________________________
_______________________________________________________________________________
_______________________________________________________________________________
_______________________________________________________________________________
(Please print or typewrite name and address including postal zip code of
assignee)
the Percentage Interest evidenced by the within Certificate and hereby
authorizes the transfer of registration of such Percentage Interest to
assignee on the Certificate Register of the Trust Fund.
I (We) further direct the Trustee to issue a new Certificate of a
like denomination and Class, to the above named assignee and deliver such
Certificate to the following address:
_______________________________________________________________________________
Dated:
__________________________________________
Signature by or on behalf of assignor
D-8
DISTRIBUTION INSTRUCTIONS
The assignee should include the following for purposes of
distribution:
Distributions shall be made, by wire transfer or otherwise, in
immediately available funds to _______________________________________________,
______________________________________________________________________________,
for the account of ___________________________________________________________,
account number _________, or, if mailed by check, to _________________________.
Applicable statements should be mailed to ____________________________________,
______________________________________________________________________________.
This information is provided by ________________________________.
the assignee named above, or __________________________________________, as it
agent.
D-9
EXHIBIT E
FORM OF INITIAL CERTIFICATION OF TRUSTEE
[date]
▇▇▇▇▇▇ ▇▇▇▇▇▇▇ ABS Capital I Inc.
▇▇▇▇ ▇▇▇▇▇▇▇▇, ▇▇▇▇ ▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇
[__________________]
[ADDRESS]
[ADDRESS]
[ADDRESS]
[SERVICER]
[ADDRESS]
[ADDRESS]
[RESPONSIBLE PARTY]
[ADDRESS]
[ADDRESS]
[SERVICER]
[ADDRESS]
[ADDRESS]
Re: Pooling and Servicing Agreement, dated as of [_______] ,
2006, among ▇▇▇▇▇▇ ▇▇▇▇▇▇▇ ABS Capital I Inc., as
Depositor, [__________________], as a Servicer,
[____________________], as a Servicer, [___________], as
Responsible Party, and [_______________], as Trustee,
▇▇▇▇▇▇ ▇▇▇▇▇▇▇ ABS Capital I Inc. Trust, Series 2006-[___]
Ladies and Gentlemen:
In accordance with Section 2.02 of the above-captioned Pooling and
Servicing Agreement (the "Pooling and Servicing Agreement"), for each Mortgage
Loan listed in the Mortgage Loan Schedule (other than any Mortgage Loan listed
in the attached schedule), it has received:
(i)the original Mortgage Note, endorsed as provided in the following
form: "Pay to the order of ________, without recourse"; and
(ii) a duly executed assignment of the Mortgage (which may be
included in a blanket assignment or assignments).
E-1
Based on its review and examination and only as to the foregoing
documents, such documents appear regular on their face and related to such
Mortgage Loan.
The Trustee has made no independent examination of any documents
contained in each Mortgage File beyond the review specifically required in the
Pooling and Servicing Agreement. The Trustee makes no representations as to:
(i) the validity, legality, sufficiency, enforceability or genuineness of any
of the documents contained in each Mortgage File of any of the Mortgage Loans
identified on the Mortgage Loan Schedule, or (ii) the collectability,
insurability, effectiveness or suitability of any such Mortgage Loan.
Notwithstanding anything herein to the contrary, the Trustee has made no
determination and makes no representations as to whether (i) any endorsement
is sufficient to transfer all right, title and interest of the party so
endorsing, as Noteholder or assignee thereof, in and to that Mortgage Note or
(ii) any assignment is in recordable form or sufficient to effect the
assignment of and transfer to the assignee thereof, under the Mortgage to
which the assignment relates.
Capitalized words and phrases used herein shall have the respective
meanings assigned to them in the Pooling and Servicing Agreement.
[___________________],
as Trustee
By:______________________________
Name:____________________________
Title:___________________________
E-2
EXHIBIT F
FORM OF DOCUMENT CERTIFICATION
AND EXCEPTION REPORT OF TRUSTEE
[date]
▇▇▇▇▇▇ ▇▇▇▇▇▇▇ ABS Capital I Inc.
▇▇▇▇ ▇▇▇▇▇▇▇▇, ▇▇▇▇ ▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇
[SERVICER]
[ADDRESS]
[ADDRESS]
[ADDRESS]
[SERVICER]
[ADDRESS]
[ADDRESS]
[RESPONSIBLE PARTY]
[ADDRESS]
[ADDRESS]
[TRUSTEE]
[ADDRESS]
[ADDRESS]
Re: Pooling and Servicing Agreement, dated as of [_______] ,
2005, among ▇▇▇▇▇▇ ▇▇▇▇▇▇▇ ABS Capital I Inc., as
Depositor, [__________________], as a Servicer,
[____________________], as a Servicer, [___________], as
Responsible Party, and [_______________], as Trustee,
▇▇▇▇▇▇ ▇▇▇▇▇▇▇ ABS Capital I Inc. Trust, Series 2006-[___]
Ladies and Gentlemen:
In accordance with Section 2.02 of the above-captioned Pooling and
Servicing Agreement (the "Pooling and Servicing Agreement"), the undersigned,
as Trustee, hereby certifies that as to each Mortgage Loan listed in the
Mortgage Loan Schedule (other than any Mortgage Loan paid in full or listed on
the attached Document Exception Report) it has received:
(i)The original Mortgage Note, endorsed in the form provided in
Section 2.01 of the Pooling and Servicing Agreement, with all intervening
endorsements showing a complete chain of endorsement from the originator
to the last endorsee.
(ii) The original recorded Mortgage.
F-1
(iii) A duly executed assignment of the Mortgage in the form
provided in Section 2.01 of the Pooling and Servicing Agreement; or, if
the Responsible Party has certified or the Trustee otherwise knows that
the related Mortgage has not been returned from the applicable recording
office, a copy of the assignment of the Mortgage (excluding information
to be provided by the recording office).
(iv) The original or duplicate original recorded assignment or
assignments of the Mortgage showing a complete chain of assignment from
the originator to the last endorsee.
(v)The original or duplicate original lender's title policy and all
riders thereto or, any one of an original title binder, an original
preliminary title report or an original title commitment, or a copy
thereof certified by the title company.
Based on its review and examination and only as to the foregoing
documents, (a) such documents appear regular on their face and related to such
Mortgage Loan, and (b) the information set forth in items (1) solely with
respect to the Mortgage Loan number, (2) and (7) of the Mortgage Loan Schedule
and items (1), (9) and (17) of the Data Tape Information accurately reflects
information set forth in the Custodial File.
The Trustee has made no independent examination of any documents
contained in each Mortgage File beyond the review of the Custodial File
specifically required in the Pooling and Servicing Agreement. The Trustee
makes no representations as to: (i) the validity, legality, sufficiency,
enforceability or genuineness of any of the documents contained in each
Mortgage File of any of the Mortgage Loans identified on the Mortgage Loan
Schedule, or (ii) the collectability, insurability, effectiveness or
suitability of any such Mortgage Loan. Notwithstanding anything herein to the
contrary, the Trustee has made no determination and makes no representations
as to whether (i) any endorsement is sufficient to transfer all right, title
and interest of the party so endorsing, as Noteholder or assignee thereof, in
and to that Mortgage Note or (ii) any assignment is in recordable form or
sufficient to effect the assignment of and transfer to the assignee thereof,
under the Mortgage to which the assignment relates.
Capitalized words and phrases used herein shall have the respective
meanings assigned to them in the Pooling and Servicing Agreement.
[__________________],
as Trustee
By:______________________________
Name:____________________________
Title:___________________________
F-2
EXHIBIT G
RESIDUAL TRANSFER AFFIDAVIT
▇▇▇▇▇▇ ▇▇▇▇▇▇▇ ABS Capital I Inc. Trust 2006-[___],
Mortgage Pass-Through Certificates,
Series 2006-[___]
STATE OF )
) ss.:
COUNTY OF )
The undersigned, being first duly sworn, deposes and says as
follows:
1. The undersigned is an officer of ___________________, the
proposed Transferee of an Ownership Interest in a Class R Certificate (the
"Certificate") issued pursuant to the Pooling and Servicing Agreement (the
"Agreement"), relating to the above-referenced Series, by and among ▇▇▇▇▇▇
▇▇▇▇▇▇▇ ABS Capital I Inc., as Depositor, [__________________], as a Servicer,
[____________________], as Servicer, [___________], as Responsible Party, and
[_______________], as Trustee (the "Trustee"). Capitalized terms used, but not
defined herein, shall have the meanings ascribed to such terms in the
Agreement. The Transferee has authorized the undersigned to make this
affidavit on behalf of the Transferee 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
Non-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 a Non-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 a
Non-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 a Non-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, among other things, such Transferee has no actual knowledge
that the Person to which the Transfer is to be made is a Non-Permitted
Transferee.
7. 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. The Transferee has historically paid its debts as they
have come due and intends to pay its debts as they come due in the future. The
Transferee intends to pay all taxes due with respect to the Certificate as
they become due.
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 Residual
Certificate to be attributable to a foreign permanent establishment or fixed
base, within the meaning of an applicable income tax treaty, of the Transferee
or any other U.S. Person.
12. Check the applicable paragraph:
(i)The present value of the anticipated tax liabilities associated
with holding the Certificate, as applicable, does not exceed the sum of:
G-2
(ii) the present value of any consideration given to the Transferee
to acquire such Certificate;
(iii) the present value of the expected future distributions on such
Certificate; and
(iv) 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.
(i)The transfer of the Certificate complies with U.S. Treasury
Regulations Sections 1.860E-1(c)(5) and (6) and, accordingly,
(ii) 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;
(iii) 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
$[__] and net assets in excess of $[__];
(iv) 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
(v)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.
(vi) None of the above.
5.___The Transferee is not an employee benefit plan that is subject
to Title I of ERISA or a plan that is subject to Section 4975 of the Code or a
plan subject to any Federal, state
G-3
or local law that is substantially similar to Title I of ERISA or Section 4975
of the Code, and the Transferee is not acting on behalf of or investing plan
assets of such a 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__
▇▇▇▇▇▇ ▇▇▇▇▇▇▇ ABS Capital I Inc.
▇▇▇▇ ▇▇▇▇▇▇▇▇, ▇▇▇▇ ▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇
Attention: ▇▇▇▇▇▇▇▇ ▇▇▇▇▇
[---------------],
as Trustee
[ADDRESS]
[ADDRESS]
Re: ▇▇▇▇▇▇ ▇▇▇▇▇▇▇ ABS Capital I Inc. Trust 2006-[___]
Mortgage Pass-Through Certificates, Series 2006-[___],
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, (i) we have no knowledge the Transferee is a
Non-Permitted Transferee, (ii) after conducting a reasonable investigation of
the financial condition of the Transferee, we have no knowledge and no reason
to believe that the Transferee will not pay all taxes with respect to the
Residual Certificates as they become due and (iii) we have 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__
▇▇▇▇▇▇ ▇▇▇▇▇▇▇ ABS Capital I Inc.
▇▇▇▇ ▇▇▇▇▇▇▇▇, ▇▇▇▇ ▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇
Attention: ▇▇▇▇▇▇▇▇ ▇▇▇▇▇
[________________],
as Trustee
[ADDRESS]
[ADDRESS]
Re: ▇▇▇▇▇▇ ▇▇▇▇▇▇▇ ABS Capital I Inc. Trust 2006-[___],
Mortgage Pass-Through Certificates, Series 2006-[___],
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) either we are purchasing a Class
A-1, Class ▇-▇, ▇▇▇▇▇ ▇-▇, Class A-4, Class M-1, Class M-2, Class M-3, Class
M-4, Class M-5, Class M-6, Class B-1, Class B-2 or Class B-3 Certificate or we
are not an employee benefit plan that is subject to Title I of 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, or a plan subject to materially similar provisions of
applicable federal, state or local law, 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 or, with respect to a Class X Certificate, the
purchaser is an insurance company that is purchasing this 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 purchase and holding of such Certificates are covered
under Sections I and III of PTCE 95-60, (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,
I-1
or taken any other action, that would constitute a distribution of the
Certificates under the Securities Act or that would render the disposition of
the Certificates a violation of Section 5 of the Securities Act or require
registration pursuant thereto, nor will act, nor has authorized or will
authorize any person to act, in such manner with respect to the Certificates,
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.
In connection with our purchase of the Certificates, we acknowledge
and agree that (i) none of you nor any of your affiliates is acting as a
fiduciary or financial or investment adviser for us; (ii) we are not relying
(for purposes of making any investment decision or otherwise) upon any advice,
counsel or representations (whether written or oral) of any of you or your
affiliates with respect to the Certificates; (iii) none of you nor any of your
affiliates has given to us (directly or indirectly through any other person)
any assurance, guarantee or representation whatsoever as to the expected or
projected success, profitability, return, performance, result, effect,
consequence, or benefit (including legal, regulatory, tax, financial,
accounting or otherwise) of our purchase of the Certificates; (iv) we have
performed our own diligence to the extent we have deemed necessary and we have
consulted with our own legal, regulatory, tax, business, investment, financial
and accounting advisers to the extent that we have deemed necessary, and we
have made our own investment decisions based upon our own judgment and upon
any advice from such advisers as we have deemed necessary and appropriate and
not upon any view expressed by any of you or your affiliates with respect to
the Certificates; (v) none of you nor any of your affiliates will be obligated
to make payments on the Certificates in the event that the assets of the trust
is insufficient to provide for such payments; (vi) you and your affiliates may
have positions and may effect transactions in any of the Series 2006-[___]
securities; and (vii) we are familiar with the Certificates and have reviewed
and understand the related pooling and servicing agreement, the prospectus
supplement and prospectus relating to Series 2006-[___] and the other material
transaction documents related thereto.
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 $ (1) in securities (except for the
excluded securities referred to below) as of the end of the Buyer's most
recent fiscal year (such amount being calculated in accordance with Rule 144A
and (ii) the Buyer satisfies the criteria in the category marked below.
____ Corporation, etc. The Buyer is a corporation (other than a
bank, savings and loan association or similar institution),
Massachusetts or similar business trust, partnership, or
charitable organization described in Section 501(c)(3) of the
Internal Revenue Code of 1986, as amended.
____ Bank. The Buyer (a) is a national bank or banking institution
organized under the laws of any State, territory or the
District of Columbia, the business of which is substantially
confined to banking and is supervised by the State or
territorial banking commission or similar official or is a
foreign bank or equivalent institution, and (b) has an audited
net worth of at least $[__] 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 $[__] as demonstrated in its
latest annual financial statements, a copy of which is
attached hereto.
---------------------
1 Buyer must own and/or invest on a discretionary basis at least
$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
____ 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 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.
I-4
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 Transferee
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.
1. 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 $[__] 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).
2. 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).
3. 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
I-6
agreements, (vi) securities owned but subject to a repurchase agreement and
(vii) currency, interest rate and commodity swaps.
4. 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.
5. 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 Transferee
By:___________________________________
Name:
Title:
IF AN ADVISER:
______________________________________
Print Name of Buyer
Date:_________________________________
I-7
EXHIBIT J
FORM OF REQUEST FOR RELEASE
(for Trustee)
To: [Trustee]
Re:
In connection with the administration of the Mortgage Loans held by
you as the Trustee on behalf of the Certificateholders, we request the
release, and acknowledge receipt, of the (Custodial File/[specify documents])
for the Mortgage Loan described below, for the reason indicated.
Mortgagor's Name, Address & Zip Code:
------------------------------------
Mortgage Loan Number:
--------------------
Send Custodial File to:
----------------------
Delivery Method (check one)
---------------------------
____1. Regular mail
____2. Overnight courier (Tracking information: )
If neither box 1 nor 2 is checked, regular mail shall be assumed.
Reason for Requesting Documents (check one)
-------------------------------
____1. Mortgage Loan Paid in Full. (The Servicer hereby certifies that all
amounts received in connection therewith have been credited to its
Collection Account as provided in the Pooling and Servicing
Agreement.)
____2. Mortgage Loan Repurchase Pursuant to Subsection 2.03 of the Pooling
and Servicing Agreement. (The Servicer hereby certifies that the
repurchase price has been credited to Collection Account as
provided in the Pooling and Servicing Agreement.)
____3. Mortgage Loan Liquidated By _________________. (The Servicer hereby
certifies that all proceeds of foreclosure, insurance, condemnation
or other liquidation have been finally received and credited to its
Collection Account pursuant to the Pooling and Servicing
Agreement.)
J-1
____4. Mortgage Loan in Foreclosure.
____5. Other (explain).
If box 1, 2 or 3 above is checked, and if all or part of the
Custodial File was previously released to us, please release to us our
previous request and receipt on file with you, as well as any additional
documents in your possession relating to the specified Mortgage Loan.
If box 4 or 5 above is checked, upon our return of all of the above
documents to you as the Trustee, please acknowledge your receipt by signing in
the space indicated below, and returning this form if requested by us.
[SERVICER]
By:____________________________________
Name:
Title:
Date:
[ACKNOWLEDGED AND AGREED:
[____________________], as Trustee
By:____________________________________
Name:
Title:
Date: ]
J-2
EXHIBIT K
CONTENTS OF EACH MORTGAGE FILE
With respect to each Mortgage Loan, the Mortgage File shall include
each of the following items, which shall be available for inspection by the
Sponsor and which shall be retained by the applicable Servicer or delivered to
and retained by the Trustee, as applicable:
(i)The original Mortgage Note bearing all intervening endorsements,
showing a complete chain of endorsement from the originator to the last
endorsee endorsed "Pay to the order of _________________ without
recourse" and signed (which may be by facsimile signature) in the name of
the last endorsee by an authorized officer. To the extent that there is
no room on the face of the Mortgage Notes for endorsements, the
endorsement may be contained on an allonge, unless the Trustee is advised
in writing by the Responsible Party that state law does not so allow.
(ii) The original of any guaranty executed in connection with the
Mortgage Note.
(iii) The original Mortgage, with evidence of recording thereon or
a certified true copy of such Mortgage submitted for recording. If in
connection with any Mortgage Loan, the Responsible Party cannot deliver
or cause to be delivered the original Mortgage with evidence of recording
thereon on or prior to the Closing Date because of a delay caused by the
public recording office where such Mortgage has been delivered for
recordation or because such Mortgage has been lost or because such public
recording office retains the original recorded Mortgage, the Responsible
Party shall deliver or cause to be delivered to the Trustee, a photocopy
of such Mortgage, together with (i) in the case of a delay caused by the
public recording office, an Officer's Certificate of the Responsible
Party or evidence of certification on the face of such photocopy of such
Mortgage or a certificate from an escrow company, a title company or
closing attorney stating that such Mortgage has been dispatched to the
appropriate public recording office for recordation and that the original
recorded Mortgage or a copy of such Mortgage certified by such public
recording office to be a true and complete copy of the original recorded
Mortgage will be promptly delivered to the Trustee upon receipt thereof
by the Responsible Party; or (ii) in the case of a Mortgage where a
public recording office retains the original recorded Mortgage or in the
case where a Mortgage is lost after recordation in a public recording
office, a copy of such Mortgage certified by such public recording office
to be a true and complete copy of the original recorded Mortgage.
(iv) The originals of all assumption, modification, consolidation
or extension agreements, with evidence of recording thereon or a
certified true copy of such agreement submitted for recording.
(v)The original Assignment of Mortgage for each Mortgage Loan
endorsed in blank.
K-1
(vi) Originals of all intervening assignments of mortgage (if any)
evidencing a complete chain of assignment from the applicable originator
to the last endorsee with evidence of recording thereon or a certified
true copy of such intervening assignments of mortgage submitted for
recording, or if any such intervening assignment has not been returned
from the applicable recording office or has been lost or if such public
recording office retains the original recorded assignments of mortgage,
the Responsible Party shall deliver or cause to be delivered to the
Trustee, a photocopy of such intervening assignment, together with (i) in
the case of a delay caused by the public recording office, an Officer's
Certificate of the Responsible Party or evidence of certification on the
face of such photocopy of such intervening assignment or a certificate
from an escrow company, a title company or a closing attorney stating
that such intervening assignment of mortgage has been dispatched to the
appropriate public recording office for recordation and that such
original recorded intervening assignment of mortgage or a copy of such
intervening assignment of mortgage certified by the appropriate public
recording office to be a true and complete copy of the original recorded
intervening assignment of mortgage will be promptly delivered to the
Trustee upon receipt thereof by the Responsible Party; or (ii) in the
case of an intervening assignment where a public recording office retains
the original recorded intervening assignment or in the case where an
intervening assignment is lost after recordation in a public recording
office, a copy of such intervening assignment certified by such public
recording office to be a true and complete copy of the original recorded
intervening assignment.
(vii) The original mortgagee title insurance policy or attorney's
opinion of title and abstract of title.
(viii) The original of any security agreement, chattel mortgage or
equivalent document executed in connection with the Mortgage (if
provided).
(ix) Residential loan application.
(x)Mortgage Loan closing statement.
(xi) Verification of employment and income, if applicable.
(xii) Verification of acceptable evidence of source and amount of
down payment.
(xiii) Credit report on Mortgagor.
(xiv) Residential appraisal report.
(xv) Photograph of the Mortgaged Property.
(xvi) Survey of the Mortgaged Property.
(xvii) Copy of each instrument necessary to complete identification
of any exception set forth in the exception schedule in the title policy,
i.e., map or plat, restrictions, easements, sewer agreements, home
association declarations, etc.
K-2
(xviii) All required disclosure statements.
(xix) If required in an appraisal, termite report, structural
engineer's report, water potability and septic certification.
(xx) Sales contract, if applicable.
Evidence of payment of taxes and insurance, insurance claim files,
correspondence, current and historical computerized data files (which include
records of tax receipts and payment history from the date of origination), and
all other processing, underwriting and closing papers and records which are
customarily contained in a mortgage loan file and which are required to
document the Mortgage Loan or to service the Mortgage Loan.
K-3
EXHIBIT L
FORM OF CERTIFICATION TO BE
PROVIDED WITH FORM 10-K
-----------------------
Re: ▇▇▇▇▇▇ ▇▇▇▇▇▇▇ ABS Capital I Inc. Trust 2006-[___] (the
"Trust"), Mortgage Pass-Through Certificates, Series
2006-[___], issued pursuant to the Pooling and Servicing
Agreement, dated as of [_______], 2006, among ▇▇▇▇▇▇ ▇▇▇▇▇▇▇
ABS Capital I Inc., as Depositor, [__________], as a Servicer,
[_______________], as trustee (the "Trustee"),
[_________________], as a servicer (each a "Servicer" and,
collectively, the "Servicers"), and [___________], as
responsible party
I, [identify the certifying individual], certify that:
(1) I have reviewed this annual report on Form 10-K ("Annual
Report"), and all reports on Form 10-D (collectively with this Annual
Report, the "Reports") required to be filed in respect of period covered
by this Annual Report, of the Trust;
(2) Based on my knowledge, the Reports, taken as a whole, do 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 with
respect to the period covered by this Annual Report;
(3) Based on my knowledge, all of the distribution, servicing and
other information required to be provided under Form 10-D for the period
covered by this Annual Report is included in the Reports;
(4) Based on my knowledge and the compliance statements required in
this Annual Report under Item 1123 of Regulation AB, and except as
disclosed in the Reports, the Servicers have fulfilled their obligations
under the Pooling and Servicing Agreement; and
(5) All of the reports on assessment of compliance with servicing
criteria for asset-backed securities and their related attestation
reports on assessment of compliance with servicing criteria required to
be included in this Annual Report in accordance with Item 1122 of
Regulation AB and Exchange Act Rules 13a-18 and 15d-18 have been included
as an exhibit to this Annual Report, except as otherwise disclosed in
this Annual Report. Any material instances of non-compliance described in
such reports have been disclosed in this Annual Report.
L-1
In giving the certifications above, I have reasonably relied on information
provided to me by the following unaffiliated parties: the Trustee and the
Servicers.
Date: _________________________
_______________________________
[Signature]
[Title]
L-2
EXHIBIT M
FORM OF CERTIFICATION
TO BE PROVIDED BY THE TRUSTEE TO DEPOSITOR
------------------------------------------
Re: ▇▇▇▇▇▇ ▇▇▇▇▇▇▇ ABS Capital I Inc. Trust 2006-[___] (the
"Trust"), Mortgage Pass-Through Certificates, Series
2006-[___], issued pursuant to the Pooling and Servicing
Agreement, dated as of [_______], 2006, among ▇▇▇▇▇▇ ▇▇▇▇▇▇▇
ABS Capital I Inc., as Depositor, [__________________], as a
Servicer, [_______________], as trustee (the "Trustee"),
[____________________], as servicer (each a "Servicer" and,
collectively, the "Servicers"), and [___________], as
responsible party
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:
(1) I have reviewed the annual report on Form 10-K for the fiscal
year [___] (the "Annual Report"), and all reports on Form 10-D required
to be filed in respect of period covered by the Annual Report
(collectively with the Annual Report, the "Reports"), of the Trust;
(2) To my knowledge, the Reports, taken as a whole, do 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 with respect to the
period covered by the Annual Report, it being understood that the Trustee
is not responsible for verifying the accuracy or completeness of
information in the Reports (a) provided by Persons other than the Trustee
or any Subcontractor utilized by the Trustee or (b) relating to Persons
other than the Trustee or any Subcontractor utilized by the Trustee as to
which a Responsible Officer of the Trustee does not have actual
knowledge;
(3) To my knowledge, the distribution or servicing information
required to be provided to the Trustee by each Servicer under the Pooling
and Servicing Agreement for inclusion in the Reports is included in the
Reports; and
(4) The report on assessment of compliance with servicing criteria
for asset-backed securities applicable to the Trustee and each
Subcontractor utilized by the Trustee and their related attestation
reports on assessment of compliance with servicing criteria applicable to
it required to be included in the Annual Report in accordance with Item
1122 of Regulation AB and Exchange Act Rules 13a-18 and 15d-18 has been
included as an exhibit to the Annual Report. Any material instances of
non-compliance are described in such report and have been disclosed in
the Annual Report.
Date: _________________________
M-1
_______________________________
[Signature]
[Title]
M-2
EXHIBIT N
FORM OF CERTIFICATION
TO BE PROVIDED BY THE SERVICER TO DEPOSITOR
-------------------------------------------
Re: ▇▇▇▇▇▇ ▇▇▇▇▇▇▇ ABS Capital I Inc. Trust 2006-[___] (the
"Trust"), Mortgage Pass-Through Certificates, Series
2006-[___], issued pursuant to the Pooling and Servicing
Agreement, dated as of [_______], 2006, among ▇▇▇▇▇▇ ▇▇▇▇▇▇▇
ABS Capital I Inc., as Depositor, [__________________], (the
"Company") as a Servicer, [_______________], as trustee (the
"Trustee"), [____________________], as servicer, and
[___________], as responsible party
[SERVICER] [SERVICER], certifies to the Depositor and the Trustee,
and their officers, directors and affiliates, and with the knowledge and
intent that they will rely upon this certification, that:
(1) The Company has reviewed the servicer compliance statement of
[SERVICER] [SERVICER] and the compliance statements of each Subservicer,
if any, engaged by [SERVICER] [SERVICER] provided to the Depositor and
the Trustee for the Trust's fiscal year [___] in accordance with Item
1123 of Regulation AB (each a "Compliance Statement"), the report on
assessment of [SERVICER's] [SERVICER's] compliance with the servicing
criteria set forth in Item 1122(d) of Regulation AB (the "Servicing
Criteria") and reports on assessment of compliance with servicing
criteria for asset-backed securities of the [SERVICER] [SERVICER] and of
each Subservicer or Subcontractor, if any, engaged or utilized by
[SERVICER] [SERVICER] provided to the Depositor and the Trustee for the
Trust's fiscal year [___] in accordance with Rules 13a-18 and 15d-18
under Securities Exchange Act of 1934, as amended (the "Exchange Act")
and Item 1122 of Regulation AB (each a "Servicing Assessment"), the
registered public accounting firm's attestation report provided in
accordance with Rules 13a-18 and 15d-18 under the Exchange Act and
Section 1122(b) of Regulation AB related to each Servicing Assessment
(each a "Attestation Report"), and all servicing reports, officer's
certificates and other information relating to the servicing of the
Mortgage Loans by [SERVICER] [SERVICER] during 200[ ] that were delivered
or caused to be delivered by [SERVICER] [SERVICER] pursuant to the
Agreement (collectively, the "Servicing Information");
(2) Based on the Company's knowledge, the Servicing Information,
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 the light of the circumstances under which such statements were
made, not misleading with respect to the period of time covered by the
Servicing Information;
N-1
(3) Based on the Company's knowledge, the servicing information
required to be provided to the Trustee by [SERVICER] [SERVICER] pursuant
to the Pooling and Servicing Agreement has been provided to the Trustee;
(4) Based on the Company's knowledge and the compliance review
conducted in preparing Compliance Statement of [SERVICER] [SERVICER] and,
if applicable, reviewing each Compliance Statement of each Subservicer,
if any, engaged by [SERVICER] [SERVICER], and except as disclosed in such
Compliance Statement[(s)], [SERVICER] [SERVICER] [(directly and through
its Subservicers, if any)] has fulfilled its obligations under the
Pooling and Servicing Agreement in all material respects.
(5) Each Servicing Assessment of the [SERVICER] [SERVICER] and of
each Subservicer or Subcontractor, if any, engaged or utilized by
[SERVICER] [SERVICER] and its related Attestation Report required to be
included in the Annual Report in accordance with Item 1122 of Regulation
AB and Exchange Act Rules 13a-18 and 15d-18 has been provided to the
Depositor and the Trustee. Any material instances of non-compliance are
described in any such Servicing Assessment or Attestation Report.
Date:___________________________
By:_____________________________
Name:___________________________
Title:__________________________
N-2
EXHIBIT O
FORM OF SERVICER POWER OF ATTORNEY
When Recorded Mail To:
[[____________________]
[ADDRESS]
[ADDRESS]]
LIMITED POWER OF ATTORNEY
KNOW ALL MEN BY THESE PRESENTS, that [_______________], a national banking
association organized and existing under the laws of the United States and
having its principal place of business at [ADDRESS], as Trustee pursuant to
that ▇▇▇▇▇▇ ▇▇▇▇▇▇▇ ABS Capital I Inc. Trust 2006-[___] Pooling and Servicing
Agreement dated as of [_______], 2006 (the "Agreement") by and among ▇▇▇▇▇▇
▇▇▇▇▇▇▇ ABS Capital I Inc., as depositor (the "Depositor"),
[____________________], as servicer ("_____"), [___________], as a responsible
party ("____") and [_______________], as trustee (the "Trustee"), hereby
constitutes and appoints [SERVICER] , by and through [SERVICER's] officers,
the Trustee's true and lawful Attorney-in-fact, in the Trustee's name, place
and stead and for the Trustee's benefit, in connection with all mortgage loans
serviced by [SERVICER] pursuant to the Agreement solely for the purpose of
performing such acts and executing such documents in the name of the Trustee
necessary and appropriate to effectuate the following enumerated transactions
in respect of any of the mortgages or deeds of trust (the "Mortgages" and the
"Deeds of Trust" respectively) and promissory notes secured thereby (the
"Mortgage Notes") for which the undersigned is acting as Trustee for various
certificateholders (whether the undersigned is named therein as mortgagee or
beneficiary or has become mortgagee by virtue of endorsement of the Mortgage
Note secured by any such Mortgage or Deed of Trust) and for which [SERVICER]
is acting as servicer.
This Appointment shall apply only to the following enumerated transactions and
nothing herein or in the Agreement shall be construed to the contrary:
1. The modification or re-recording of a Mortgage or Deed of Trust,
where said modification or re-recording is solely for the purpose
of correcting the Mortgage or Deed of Trust to conform same to the
original intent of the parties thereto or to correct title errors
discovered after such title insurance was issued; provided that
(i) said modification or re-recording, in either instance, does not
adversely affect the lien of the Mortgage or Deed of Trust as
insured and (ii) otherwise conforms to the provisions of the
Agreement.
2. The subordination of the lien of a Mortgage or Deed of Trust to an
easement in favor of a public utility company of a government
agency or unit with powers of eminent domain; this section shall
include, without limitation, the execution of
O-1
partial satisfactions/releases, partial reconveyances or the
execution or requests to trustees to accomplish same.
3. The conveyance of the properties to the mortgage insurer, or the
closing of the title to the property to be acquired as real estate
owned, or conveyance of title to real estate owned.
4. The completion of loan assumption agreements.
5. The full satisfaction/release of a Mortgage or Deed of Trust or
full conveyance upon payment and discharge of all sums secured
thereby, including, without limitation, cancellation of the related
Mortgage Note.
6. The assignment of any Mortgage or Deed of Trust and the related
Mortgage Note, in connection with the repurchase of the mortgage
loan secured and evidenced thereby.
7. The full assignment of a Mortgage or Deed of Trust upon payment and
discharge of all sums secured thereby in conjunction with the
refinancing thereof, including, without limitation, the assignment
of the related Mortgage Note.
8. With respect to a Mortgage or Deed of Trust, the foreclosure, the
taking of a deed in lieu of foreclosure, or the completion of
judicial or non-judicial foreclosure or termination, cancellation
or rescission of any such foreclosure, including, without
limitation, any and all of the following acts:
a. the substitution of trustee(s) serving under a Deed of Trust,
in accordance with state law and the Deed of Trust;
b. the preparation and issuance of statements of breach or
non-performance;
c. the preparation and filing of notices of default and/or
notices of sale;
d. the cancellation/rescission of notices of default and/or
notices of sale;
e. the taking of deed in lieu of foreclosure; and
f. the preparation and execution of such other documents and
performance of such other actions as may be necessary under
the terms of the Mortgage, Deed of Trust or state law to
expeditiously complete said transactions in paragraphs 8.a.
through 8.e. above.
9. With respect to the sale of property acquired through a foreclosure
or deed-in lieu of foreclosure, including, without limitation, the
execution of the following documentation:
a. listing agreements;
O-2
b. purchase and sale agreements;
▇. ▇▇▇▇▇/warranty/quit claim deeds or any other deed causing the
transfer of title of the property to a party contracted to
purchase same;
d. escrow instructions; and
e. any and all documents necessary to effect the transfer of
property.
10. The modification or amendment of escrow agreements established for
repairs to the mortgaged property or reserves for replacement of
personal property.
The undersigned gives said Attorney-in-fact full power and authority to
execute such instruments and to do and perform all and every act and thing
necessary and proper to carry into effect the power or powers granted by or
under this Limited Power of Attorney as fully as the undersigned might or
could do, and hereby does ratify and confirm to all that said
Attorney-in-fact shall be effective as of [_______] , 2006.
This appointment is to be construed and interpreted as a limited power of
attorney. The enumeration of specific items, rights, acts or powers herein is
not intended to, nor does it give rise to, and it is not to be construed as a
general power of attorney.
Nothing contained herein shall (i) limit in any manner any indemnification
provided by [SERVICER] to the Trustee under the Agreement, or (ii) be
construed to grant [SERVICER] the power to initiate or defend any suit,
litigation or proceeding in the name of [_______________] except as
specifically provided for herein. If [SERVICER] receives any notice of suit,
litigation or proceeding in the name of [_______________], then [SERVICER]
shall promptly forward a copy of same to the Trustee.
This limited power of attorney is not intended to extend the powers granted to
[_______] under the Agreement or to allow [_______] to take any action with
respect to Mortgages, Deeds of Trust or Mortgage Notes not authorized by the
Agreement.
[_______] hereby agrees to indemnify and hold the Trustee and its directors,
officers, employees and agents harmless from and against any and all
liabilities, obligations, losses, damages, penalties, actions, judgments,
suits, costs, expenses or disbursements of any kind or nature whatsoever
incurred by reason or result of or in connection with the exercise by
[_______] of the powers granted to it hereunder. The foregoing indemnity shall
survive the termination of this Limited Power of Attorney and the Agreement or
the earlier resignation or removal of the Trustee under the Agreement.
This Limited Power of Attorney is entered into and shall be governed by the
laws of the State of New York, without regard to conflicts of law principles
of such state.
Third parties without actual notice may rely upon the exercise of the power
granted under this Limited Power of Attorney; and may be satisfied that this
Limited Power of Attorney shall continue in full force and effect and has not
been revoked unless an instrument of revocation has been made in writing by
the undersigned.
O-3
IN WITNESS WHEREOF, [_______________], as Trustee has caused its corporate
seal to be hereto affixed and these presents to be signed and acknowledged in
its name and behalf by a duly elected and authorized signatory this
___________ day of ____________.
[_______________], as Trustee
By:______________________________________
Name:
Title:
Acknowledged and Agreed
[_____________________]
By:_______________________________
Name:
Title:
O-4
STATE OF [STATE]
COUNTY OF ____________
On ________________, _____, before me, the undersigned, a Notary
Public in and for said state, personally appeared
________________________________ of [_______________], as Trustee for ▇▇▇▇▇▇
▇▇▇▇▇▇▇ ABS Capital I Inc. Trust 2006-[___] personally known to me to be the
person whose name is subscribed to the within instrument and acknowledged to
me that he/she executed that same in his/her authorized capacity, and that by
his/her signature on the instrument the entity upon behalf of which the person
acted and executed the instrument.
WITNESS my hand and official seal.
(SEAL)
_____________________________________________
Notary Public, State of [STATE]
O-5
[SERVICER]
[ADDRESS]
[ADDRESS]
[ADDRESS]
[SERVICER]
[ADDRESS]
[ADDRESS]
LIMITED POWER OF ATTORNEY
KNOW ALL MEN BY THESE PRESENTS, that [_______________], a national banking
association organized and existing under the laws of the United States, and
having its principal place of business at [ADDRESS], as Trustee pursuant to
that ▇▇▇▇▇▇ ▇▇▇▇▇▇▇ ABS Capital I Inc. Trust 2006-1 Pooling and Servicing
Agreement, dated as of [_______], 2006, among ▇▇▇▇▇▇ ▇▇▇▇▇▇▇ ABS Capital I
Inc., as Depositor, [__________________], as a Servicer,
[____________________], as Servicer ("_____"), [___________], as a responsible
party ("___"), and [_______________], as Trustee, hereby constitutes and
appoints [SERVICER] [SERVICER], by and through [SERVICER's] [SERVICER's]
officers, the Trustee's true and lawful Attorney-in-fact, in the Trustee's
name, place and stead and for the Trustee's benefit, in connection with all
mortgage loans serviced by [SERVICER] [SERVICER] pursuant to the Agreement
solely for the purpose of performing such acts and executing such documents in
the name of the Trustee necessary and appropriate to effectuate the following
enumerated transactions in respect of any of the mortgages or deeds of trust
(the "Mortgages" and the "Deeds of Trust" respectively) and promissory notes
secured thereby (the "Mortgage Notes") for which the undersigned is acting as
Trustee for various certificateholders (whether the undersigned is named
therein as mortgagee or beneficiary or has become mortgagee by virtue of
endorsement of the Mortgage Note secured by any such Mortgage or Deed of
Trust) and for which [SERVICER] [SERVICER] is acting as servicer.
This Appointment shall apply only to the following enumerated transactions and
nothing herein or in the Agreement shall be construed to the contrary:
1. The modification or re-recording of a Mortgage or Deed of Trust,
where said modification or re-recording is solely for the purpose
of correcting the Mortgage or Deed of Trust to conform same to the
original intent of the parties thereto or to correct title errors
discovered after such title insurance was issued; provided that
(i) said modification or re-recording, in either instance, does not
adversely affect the lien of the Mortgage or Deed of Trust as
insured and (ii) otherwise conforms to the provisions of the
Agreement.
2. The subordination of the lien of a Mortgage or Deed of Trust to an
easement in favor of a public utility company of a government
agency or unit with powers of eminent domain; this section shall
include, without limitation, the execution of partial
satisfactions/releases, partial reconveyances or the execution or
requests to trustees to accomplish same.
O-6
3. The conveyance of the properties to the mortgage insurer, or the
closing of the title to the property to be acquired as real estate
owned, or conveyance of title to real estate owned.
4. The completion of loan assumption agreements.
5. The full satisfaction/release of a Mortgage or Deed of Trust or
full conveyance upon payment and discharge of all sums secured
thereby, including, without limitation, cancellation of the related
Mortgage Note.
6. The assignment of any Mortgage or Deed of Trust and the related
Mortgage Note, in connection with the repurchase of the mortgage
loan secured and evidenced thereby.
7. The full assignment of a Mortgage or Deed of Trust upon payment and
discharge of all sums secured thereby in conjunction with the
refinancing thereof, including, without limitation, the assignment
of the related Mortgage Note.
8. With respect to a Mortgage or Deed of Trust, the foreclosure, the
taking of a deed in lieu of foreclosure, or the completion of
judicial or non-judicial foreclosure or termination, cancellation
or rescission of any such foreclosure, including, without
limitation, any and all of the following acts:
a. the substitution of trustee(s) serving under a Deed of Trust,
in accordance with state law and the Deed of Trust;
b. the preparation and issuance of statements of breach or
non-performance;
c. the preparation and filing of notices of default and/or
notices of sale;
d. the cancellation/rescission of notices of default and/or
notices of sale;
e. the taking of deed in lieu of foreclosure; and
f. the preparation and execution of such other documents and
performance of such other actions as may be necessary under
the terms of the Mortgage, Deed of Trust or state law to
expeditiously complete said transactions in paragraphs 8.a.
through 8.e. above.
9. With respect to the sale of property acquired through a foreclosure
or deed-in lieu of foreclosure, including, without limitation, the
execution of the following documentation:
a. listing agreements;
b. purchase and sale agreements;
O-7
▇. ▇▇▇▇▇/warranty/quit claim deeds or any other deed causing the
transfer of title of the property to a party contracted to
purchase same;
d. escrow instructions; and
e. any and all documents necessary to effect the transfer of
property.
10. The modification or amendment of escrow agreements established for
repairs to the mortgaged property or reserves for replacement of
personal property.
The undersigned gives said Attorney-in-fact full power and
authority to execute such instruments and to do and perform all and every act
and thing necessary and proper to carry into effect the power or powers
granted by or under this Limited Power of Attorney as fully as the undersigned
might or could do, and hereby does ratify and confirm to all that said
Attorney-in-fact shall be effective as of [_______], 2006.
This appointment is to be construed and interpreted as a limited
power of attorney. The enumeration of specific items, rights, acts or powers
herein is not intended to, nor does it give rise to, and it is not to be
construed as a general power of attorney.
Nothing contained herein shall (i) limit in any manner any
indemnification provided by [SERVICER] [SERVICER] to the Trustee under the
Agreement, or (ii) be construed to grant [SERVICER] [SERVICER] the power to
initiate or defend any suit, litigation or proceeding in the name of
[_______________] except as specifically provided for herein. If [SERVICER]
[SERVICER] receives any notice of suit, litigation or proceeding in the name
of [_______________] or [_____________], then [SERVICER] [SERVICER] shall
promptly forward a copy of same to the Trustee.
This limited power of attorney is not intended to extend the powers
granted to [SERVICER] [SERVICER] under the Agreement or to allow [SERVICER]
[SERVICER] to take any action with respect to Mortgages, Deeds of Trust or
Mortgage Notes not authorized by the Agreement.
[SERVICER] [SERVICER] hereby agrees to indemnify and hold the
Trustee and its directors, officers, employees and agents harmless from and
against any and all liabilities, obligations, losses, damages, penalties,
actions, judgments, suits, costs, expenses or disbursements of any kind or
nature whatsoever incurred by reason or result of or in connection with the
exercise by [SERVICER] [SERVICER] of the powers granted to it hereunder. The
foregoing indemnity shall survive the termination of this Limited Power of
Attorney and the Agreement or the earlier resignation or removal of the
Trustee under the Agreement.
This Limited Power of Attorney is entered into and shall be
governed by the laws of the State of New York, without regard to conflicts of
law principles of such state.
Third parties without actual notice may rely upon the exercise of
the power granted under this Limited Power of Attorney; and may be satisfied
that this Limited Power of Attorney shall continue in full force and effect
and has not been revoked unless an instrument of revocation has been made in
writing by the undersigned.
O-8
IN WITNESS WHEREOF, [_______________], as Trustee has caused its
corporate seal to be hereto affixed and these presents to be signed and
acknowledged in its name and behalf by a duly elected and authorized signatory
this ___________ day of ____________.
[_______________], as Trustee
By:______________________________________
Name:
Title:
Acknowledged and Agreed
[SERVICER]
[SERVICER]
By:___________________________
Name:
Title:
O-9
STATE OF [STATE]
COUNTY OF ____________
On ________________, _____, before me, the undersigned, a Notary
Public in and for said state, personally appeared
________________________________ of [_______________], as Trustee for ▇▇▇▇▇▇
▇▇▇▇▇▇▇ ABS Capital I Inc. Trust 2006-[___], personally known to me to be the
person whose name is subscribed to the within instrument and acknowledged to
me that he/she executed that same in his/her authorized capacity, and that by
his/her signature on the instrument the entity upon behalf of which the person
acted and executed the instrument.
WITNESS my hand and official seal.
(SEAL)
_____________________________________________
Notary Public, State of [STATE]
O-10
EXHIBIT P
SERVICING CRITERIA TO BE ADDRESSED IN ASSESSMENT OF COMPLIANCE
The assessment of compliance to be delivered by [the Trustee], [each Servicer]
and [each Subservicer] shall address, at a minimum, the criteria identified as
below as "Applicable Servicing Criteria":
------------------------------------------------------------------------------------------ ----------------------
APPLICABLE
SERVICING
SERVICING CRITERIA CRITERIA
------------------------------------------------------------------------------------------ ----------------------
Reference Criteria
-------------------- --------------------------------------------------------------------- ----------------------
General Servicing Considerations
-------------------- --------------------------------------------------------------------- ----------------------
Policies and procedures are instituted to monitor any
performance Trustee/Servicer or other triggers and events
1122(d)(1)(i) of default in accordance with the transaction agreements. Trustee/Servicer
-------------------- --------------------------------------------------------------------- ----------------------
If any material servicing activities are outsourced to third Trustee/Servicer
parties, policies and procedures are instituted to monitor the
third party's performance and compliance with such servicing
1122(d)(1)(ii) activities.
-------------------- --------------------------------------------------------------------- ----------------------
Any requirements in the transaction agreements to
maintain a N/A back-up servicer for the mortgage loans
1122(d)(1)(iii) are maintained.
-------------------- --------------------------------------------------------------------- ----------------------
A fidelity bond and errors and omissions policy is in
effect on the Servicer party participating in the
servicing function throughout the reporting period in the
amount of coverage required by and otherwise in
1122(d)(1)(iv) accordance with the terms of the transaction agreements. Servicer
-------------------- --------------------------------------------------------------------- ----------------------
Cash Collection and Administration
-------------------- --------------------------------------------------------------------- ----------------------
Payments on mortgage loans are deposited into the appropriate Servicer
custodial bank accounts and related bank clearing accounts no more
than two business days following receipt, or such other number of
1122(d)(2)(i) days specified in the transaction agreements.
-------------------- --------------------------------------------------------------------- ----------------------
Disbursements made via wire transfer on behalf of an
obligor or to Servicer/Trustee an investor are made only
1122(d)(2)(ii) by authorized personnel.
-------------------- --------------------------------------------------------------------- ----------------------
Advances of funds or guarantees regarding collections, cash flows Servicer
or distributions, and any interest or other fees charged for such
advances, are made, reviewed and approved as specified in the
1122(d)(2)(iii) transaction agreements.
-------------------- --------------------------------------------------------------------- ----------------------
The related accounts for the transaction, such as cash reserve
accounts or accounts established as a form of
overcollateralization, are separately maintained (e.g., with Servicer/Trustee
respect to commingling of cash) as set forth in the transaction
1122(d)(2)(iv) agreements.
-------------------- --------------------------------------------------------------------- ----------------------
Each custodial account is maintained at a federally
insured Servicer/Trustee depository institution as set
forth in the transaction agreements. For purposes of this
criterion, "federally insured depository institution"
with respect to a foreign financial institution means a
foreign financial institution that meets the requirements
1122(d)(2)(v) of Rule 13k-1(b)(1) of the Securities Exchange Act. Servicer/Trustee
-------------------- --------------------------------------------------------------------- ----------------------
Unissued checks are safeguarded so as to prevent unauthorized Servicer/Trustee
1122(d)(2)(vi) access.
-------------------- --------------------------------------------------------------------- ----------------------
Reconciliations are prepared on a monthly basis for all Servicer/Trustee
asset-backed securities related bank accounts, including custodial
accounts and related bank clearing accounts. These reconciliations
are (A) mathematically accurate; (B) prepared within 30 calendar
days after the bank statement cutoff date, or such other number of
days specified in the transaction agreements; (C) reviewed and
approved by someone other than the person who prepared the
reconciliation; and (D) contain explanations for reconciling items.
These reconciling items are resolved within 90 calendar days of
their original identification, or such other number of days
1122(d)(2)(vii) specified in the transaction agreements.
-------------------- --------------------------------------------------------------------- ----------------------
P-1
------------------------------------------------------------------------------------------ ----------------------
APPLICABLE
SERVICING
SERVICING CRITERIA CRITERIA
------------------------------------------------------------------------------------------ ----------------------
Reference Criteria
-------------------- --------------------------------------------------------------------- ----------------------
Investor Remittances and Reporting
-------------------- --------------------------------------------------------------------- ----------------------
Reports to investors, including those to be filed with the Servicer/Trustee
Commission, are maintained in accordance with the transaction
agreements and applicable Commission requirements. Specifically,
such reports (A) are prepared in accordance with timeframes and
other terms set forth in the transaction agreements; (B) provide
information calculated in accordance with the terms specified in
the transaction agreements; (C) are filed with the Commission as
required by its rules and regulations; and (D) agree with
investors' or the trustee's records as to the total unpaid
principal balance and number of mortgage loans serviced by the
1122(d)(3)(i) Servicer.
-------------------- --------------------------------------------------------------------- ----------------------
Amounts due to investors are allocated and remitted in
accordance Servicer/Trustee with timeframes, distribution
priority and other terms set forth in the transaction
1122(d)(3)(ii) agreements. Servicer/Trustee
-------------------- --------------------------------------------------------------------- ----------------------
Disbursements made to an investor are posted within two business
days to the Servicer's investor records, or such other number of Servicer/Trustee
1122(d)(3)(iii) days specified in the transaction agreements.
-------------------- --------------------------------------------------------------------- ----------------------
Amounts remitted to investors per the investor reports agree with
cancelled checks, or other form of payment, or custodial bank Servicer/Trustee
1122(d)(3)(iv) statements.
-------------------- --------------------------------------------------------------------- ----------------------
Pool Asset Administration
-------------------- --------------------------------------------------------------------- ----------------------
Collateral or security on mortgage loans is maintained as
required Servicer/Trustee by the transaction agreements
1122(d)(4)(i) or related mortgage loan documents. Servicer/Trustee
-------------------- --------------------------------------------------------------------- ----------------------
Mortgage loan and related documents are safeguarded as required by Trustee
1122(d)(4)(ii) the transaction agreements
-------------------- --------------------------------------------------------------------- ----------------------
Any additions, removals or substitutions to the asset
pool are Trustee/Servicer made, reviewed and approved in
accordance with any conditions or requirements in the
1122(d)(4)(iii) transaction agreements. Trustee/Servicer
-------------------- --------------------------------------------------------------------- ----------------------
Payments on mortgage loans, including any payoffs, made in Servicer
accordance with the related mortgage loan documents are posted to
the Servicer's obligor records maintained no more than two business
days after receipt, or such other number of days specified in the
transaction agreements, and allocated to principal, interest or
other items (e.g., escrow) in accordance with the related mortgage
1122(d)(4)(iv) loan documents.
-------------------- --------------------------------------------------------------------- ----------------------
The Servicer's records regarding the mortgage loans agree with the Servicer
Servicer's records with respect to an obligor's unpaid principal
1122(d)(4)(v) balance.
-------------------- --------------------------------------------------------------------- ----------------------
Changes with respect to the terms or status of an obligor's Servicer
mortgage loans (e.g., loan modifications or re-agings) are made,
reviewed and approved by authorized personnel in accordance with
1122(d)(4)(vi) the transaction agreements and related pool asset documents.
-------------------- --------------------------------------------------------------------- ----------------------
Loss mitigation or recovery actions (e.g., forbearance plans, Servicer
modifications and deeds in lieu of foreclosure, foreclosures and
repossessions, as applicable) are initiated, conducted and
concluded in accordance with the timeframes or other requirements
1122(d)(4)(vii) established by the transaction agreements.
-------------------- --------------------------------------------------------------------- ----------------------
Records documenting collection efforts are maintained during the Servicer
period a mortgage loan is delinquent in accordance with the
transaction agreements. Such records are maintained on at least a
monthly basis, or such other period specified in the transaction
agreements, and describe the entity's activities in monitoring
delinquent mortgage loans including, for example, phone calls,
letters and payment rescheduling plans in cases where delinquency
1122(d)(4)(viii) is deemed temporary (e.g., illness or unemployment).
-------------------- --------------------------------------------------------------------- ----------------------
Adjustments to interest rates or rates of return for
mortgage loans Servicer with variable rates are computed
1122(d)(4)(ix) based on the related mortgage loan documents. Servicer
-------------------- --------------------------------------------------------------------- ----------------------
P-2
------------------------------------------------------------------------------------------ ----------------------
APPLICABLE
SERVICING
SERVICING CRITERIA CRITERIA
------------------------------------------------------------------------------------------ ----------------------
Reference Criteria
-------------------- --------------------------------------------------------------------- ----------------------
Regarding any funds held in trust for an obligor (such as escrow Servicer
accounts): (A) such funds are analyzed, in accordance with the
obligor's mortgage loan documents, on at least an annual basis, or
such other period specified in the transaction agreements; (B)
interest on such funds is paid, or credited, to obligors in
accordance with applicable mortgage loan documents and state laws;
and (C) such funds are returned to the obligor within 30 calendar
days of full repayment of the related mortgage loans, or such other
1122(d)(4)(x) number of days specified in the transaction agreements.
-------------------- --------------------------------------------------------------------- ----------------------
Payments made on behalf of an obligor (such as tax or insurance Servicer
payments) are made on or before the related penalty or expiration
dates, as indicated on the appropriate bills or notices for such
payments, provided that such support has been received by the
servicer at least 30 calendar days prior to these dates, or such
1122(d)(4)(xi) other number of days specified in the transaction agreements.
-------------------- --------------------------------------------------------------------- ----------------------
Any late payment penalties in connection with any payment
to be Servicer made on behalf of an obligor are paid from
the servicer's funds and not charged to the obligor,
unless the late payment was due to the obligor's error or
1122(d)(4)(xii) omission. Servicer
-------------------- --------------------------------------------------------------------- ----------------------
Disbursements made on behalf of an obligor are posted
within two business days to the obligor's records
maintained by the servicer, or such other number of days
specified in the transaction Servicer
1122(d)(4)(xiii) agreements.
-------------------- --------------------------------------------------------------------- ----------------------
Delinquencies, charge-offs and uncollectible accounts are Servicer
recognized and recorded in accordance with the transaction
1122(d)(4)(xiv) agreements.
-------------------- --------------------------------------------------------------------- ----------------------
Any external enhancement or other support, identified in Item
1114(a)(1) through (3) or Item 1115 of Regulation AB, is maintained Trustee
1122(d)(4)(xv) as set forth in the transaction agreements.
-------------------- --------------------------------------------------------------------- ----------------------
-------------------- --------------------------------------------------------------------- ----------------------
P-3
EXHIBIT Q
ADDITIONAL FORM 10-D DISCLOSURE
------------------------------------------------- -----------------------------------------------
Item on Form 10-D Party Responsible
------------------------------------------------- -----------------------------------------------
Item 1: Distribution and Pool Performance Servicer
Information Trustee
Any information required by Item 1121 of
Regulation AB which is NOT included on
the Monthly Statement
------------------------------------------------- -----------------------------------------------
Item 2: Legal Proceedings (i) All parties to the Agreement (as to
themselves), (ii) the Trustee and Servicer as
per Item 1117 of Regulation AB to the issuing entity, (iii) the Depositor as
to the sponsor, and each Originator (other
than a Responsible Party) or any Regulation
AB Item 1100(d)(1) party
------------------------------------------------- -----------------------------------------------
Item 3: Sale of Securities and Use of Depositor
Proceeds
------------------------------------------------- -----------------------------------------------
Item 4: Defaults Upon Senior Securities Trustee
------------------------------------------------- -----------------------------------------------
Item 5: Submission of Matters to a Vote Depositor or the party to this Agreement
of Security Holders submitting such matter to a vote of
Certificateholders
------------------------------------------------- -----------------------------------------------
Item 6: Significant Obligors of Pool N/A
Assets
------------------------------------------------- -----------------------------------------------
Item 7: Significant Enhancement Provider Depositor
Information
------------------------------------------------- -----------------------------------------------
Item 8: Other Information Any party to the Agreement responsible for
disclosure items on Form 8-K
------------------------------------------------- -----------------------------------------------
Item 9: Exhibits Trustee
------------------------------------------------- -----------------------------------------------
Q-1
EXHIBIT R
ADDITIONAL FORM 10-K DISCLOSURE
---------------------------------------------- --------------------------------------------------
Item on Form 10-K Party Responsible
---------------------------------------------- --------------------------------------------------
Item 1B: Unresolved Staff Comments Depositor
---------------------------------------------- --------------------------------------------------
Item 9B: Other Information Any party to the Agreement responsible for
disclosure items on Form 8-K
---------------------------------------------- --------------------------------------------------
Item 15: Exhibits, Financial Statement Trustee
Schedules Depositor
---------------------------------------------- --------------------------------------------------
Additional Item: (i) All parties to the Agreement (as to
themselves), (ii) the Trustee and Servicer as to
Disclosure per Item 1117 of the Trust, (iii) the Depositor as to the sponsor
Regulation AB and each Originator (other than a Responsible
Party), or any 1100(d)(1) party
---------------------------------------------- --------------------------------------------------
Additional Item: (i) All parties to the Agreement as to
Disclosure per Item 1119 of Regulation themselves, (ii) the Depositor as to the
AB sponsor, or any derivative provider
---------------------------------------------- --------------------------------------------------
Additional Item: N/A
Disclosure per Item 1112(b) of
Regulation AB
---------------------------------------------- --------------------------------------------------
Additional Item: Depositor
Disclosure per Items 1114(b) and
1115(b) of Regulation AB
---------------------------------------------- --------------------------------------------------
R-1
EXHIBIT S
FORM 8-K DISCLOSURE INFORMATION
------------------------------------------------------- ------------------------------------------
Item on Form 8-K Party Responsible
------------------------------------------------------- ------------------------------------------
Item 1.01- Entry into a Material Definitive The party to this Agreement entering
Agreement into such material definitive agreement
------------------------------------------------------- ------------------------------------------
Item 1.02- Termination of a Material Definitive The party to this Agreement requesting
Agreement termination of a material definitive
agreement
------------------------------------------------------- ------------------------------------------
Item 1.03- Bankruptcy or Receivership Depositor
------------------------------------------------------- ------------------------------------------
Item 2.04- Triggering Events that Accelerate or Depositor/Trustee
Increase a Direct Financial Obligation or an
Obligation under an Off-Balance Sheet
Arrangement
------------------------------------------------------- ------------------------------------------
Item 3.03- Material Modification to Rights of The party requesting such modification.
Security Holders
------------------------------------------------------- ------------------------------------------
Item 5.03- Amendments of Articles of Depositor
Incorporation or Bylaws; Change of Fiscal Year
------------------------------------------------------- ------------------------------------------
Item 6.01- ABS Informational and Computational Depositor
Material
------------------------------------------------------- ------------------------------------------
Item 6.02- Change of Servicer or Trustee Servicers, Trustee
------------------------------------------------------- ------------------------------------------
Item 6.03- Change in Credit Enhancement or Depositor/Trustee
External Support
------------------------------------------------------- ------------------------------------------
Item 6.04- Failure to Make a Required Trustee
Distribution
------------------------------------------------------- ------------------------------------------
Item 6.05- Securities Act Updating Disclosure Depositor
------------------------------------------------------- ------------------------------------------
Item 7.01- Regulation FD Disclosure Depositor
------------------------------------------------------- ------------------------------------------
Item 8.01 Depositor
------------------------------------------------------- ------------------------------------------
Item 9.01 Depositor
------------------------------------------------------- ------------------------------------------
S-1
EXHIBIT T
INTEREST RATE SWAP AGREEMENT
T-1
EXHIBIT U
PURCHASE AGREEMENT
U-1
EXHIBIT V
SUBSERVICING AGREEMENT
V-1