EXECUTION COPY
STRUCTURED ASSET MORTGAGE INVESTMENTS II INC.,
Depositor
DEUTSCHE BANK NATIONAL TRUST COMPANY,
Trustee
DEUTSCHE BANK TRUST COMPANY DELAWARE,
Delaware Trustee
▇▇▇▇▇ FARGO BANK, N.A.,
Master Servicer
▇▇▇▇▇ FARGO BANK, N.A.,
Securities Administrator
and
▇▇▇▇▇▇▇▇▇ MORTGAGE HOME LOANS, INC.
_____________________________________________
TRUST, POOLING AND SERVICING AGREEMENT
Dated as of March 1, 2004
_____________________________________________
▇▇▇▇▇▇▇▇▇ MORTGAGE SECURITIES TRUST 2004-1,
Mortgage Pass-Through Certificates,
Series 2004-1
TABLE OF CONTENTS
PAGE
ARTICLE I
Definitions
Section 1A.01. Name of Trust..............................................37
Section 1A.02. Office.....................................................37
Section 1A.03. Declaration of Trust.......................................37
Section 1A.04. Purpose and Powers.........................................37
Section 1A.05. Liability of the Certificateholders........................37
Section 1A.06. Title To Trust Property....................................38
Section 1A.07. Situs of Trust.............................................38
Section 1A.08. The Delaware Trustee.......................................38
Section 1A.09 Separateness Provisions....................................39
ARTICLE II
Conveyance of Mortgage Loans; Original Issuance of Certificates
Section 2.01 Conveyance of Mortgage Loans and Other Assets to
the Trust..................................................40
Section 2.02 Acceptance of Mortgage Loans and Other Trust
Assets by Trustee..........................................44
Section 2.03 Mortgage Loan Purchase Agreement...........................46
Section 2.04 Substitution of Mortgage Loans.............................47
Section 2.05 Issuance of Certificates...................................48
Section 2.06 Representations and Warranties Concerning the Depositor....49
Section 2.07 Representations and Warranties Concerning the Mortgage
Loans......................................................50
Section 2.08 Appointment of Custodian...................................50
ARTICLE III
Administration and Servicing of Mortgage Loans
Section 3.01 Master Servicer............................................52
Section 3.02 REMIC-Related Covenants....................................53
Section 3.03 Monitoring of Servicers....................................53
Section 3.04 Fidelity Bond..............................................54
Section 3.05 Power to Act; Procedures...................................54
Section 3.06 Due-on-Sale Clauses; Assumption Agreements.................55
Section 3.07 Release of Mortgage Files..................................56
Section 3.08 Documents, Records and Funds in Possession of
Master Servicer To Be Held for Trust.......................57
Section 3.09 Standard Hazard Insurance and Flood Insurance Policies.....57
Section 3.10 Presentment of Claims and Collection of Proceeds...........58
Section 3.11 Maintenance of the Primary Mortgage Insurance Policies.....58
Section 3.12 Trustee to Retain Possession of Certain Insurance
Policies and Documents.....................................59
Section 3.13 Realization Upon Defaulted Mortgage Loans..................59
Section 3.13A. Realization upon Troubled Mortgage Loans...................59
Section 3.14 Additional Compensation to the Master Servicer.............59
Section 3.15 REO Property...............................................60
Section 3.16 Annual Officer's Certificate as to Compliance..............60
Section 3.17 Annual Independent Accountant's Servicing Report...........61
Section 3.18 Reports Filed with Securities and Exchange Commission......61
Section 3.19 Amendments to Master Servicing Guide and
Correspondent Sellers Guide................................62
Section 3.20 UCC........................................................62
Section 3.21 Purchase of Certain Mortgage Loans.........................63
Section 3.22 Instructions to the Trustee................................64
ARTICLE IV
Accounts
Section 4.01 Servicer Accounts..........................................65
Section 4.02 Master Servicer Collection Account.........................66
Section 4.03 Permitted Withdrawals and Transfers from the
Master Servicer Collection Account.........................67
Section 4.04 Distribution Account.......................................70
Section 4.05 Permitted Withdrawals and Transfers from the
Distribution Account.......................................70
ARTICLE V
Certificates
Section 5.01 Certificates...............................................72
Section 5.02 Registration of Transfer and Exchange of Certificates......78
Section 5.03 Mutilated, Destroyed, Lost or Stolen Certificates..........80
Section 5.04 Persons Deemed Owners......................................81
Section 5.05 Transfer Restrictions on Residual Certificates.............81
Section 5.06 Restrictions on Transferability of Private Certificates....82
Section 5.07 ERISA Restrictions.........................................82
Section 5.08 Rule 144A Information......................................83
Section 5.09 Optional Purchase of Certificates..........................83
ARTICLE VI
Payments to Certificateholders
Section 6.01 Distributions on the Certificates..........................86
Section 6.02 Allocation of Losses.......................................91
Section 6.03 Payments...................................................91
Section 6.04 Statements to the Trustee, the
Certificateholders and Others..............................92
Section 6.05 Monthly Advances...........................................95
Section 6.06 Reserved...................................................95
Section 6.07 Compensating Interest Payments.............................95
ARTICLE VII
The Master Servicer
Section 7.01 Liabilities of the Master Servicer.........................96
Section 7.02 Merger or Consolidation of the Master Servicer.............96
Section 7.03 Indemnification of the Trustee, the Delaware Trustee,
the Depositor, the Master
Servicer and the Securities Administrator..................96
Section 7.04 Limitations on Liability of the Master Servicer and Others.97
Section 7.05 Master Servicer Not to Resign..............................98
Section 7.06 Successor Master Servicer..................................98
Section 7.07 Sale and Assignment of Master Servicing....................99
ARTICLE VIII
Default
Section 8.01 Events of Default.........................................100
Section 8.02 Trustee to Act; Appointment of Successor..................101
Section 8.03 Notification to Certificateholders........................102
Section 8.04 Waiver of Defaults........................................102
Section 8.05 List of Certificateholders................................103
ARTICLE IX
Concerning the Trustee and the Securities Administrator
Section 9.01 Duties of Trustee and Securities Administrator............104
Section 9.02 Certain Matters Affecting the Trustee and the
Securities Administrator..................................106
Section 9.03 Trustee and Securities Administrator Not Liable for
Certificates or Mortgage Loans............................108
Section 9.04 Trustee, Custodian, Delaware Trustee, Master Servicer
and Securities Administrator May Own Certificates.........109
Section 9.05 Trustee's, Delaware Trustee's and Securities
Administrator's Fees and Expenses.........................109
Section 9.06 Eligibility Requirements for Trustee, Securities
Administrator and Delaware Trustee........................110
Section 9.07 Insurance.................................................110
Section 9.08 Resignation and Removal of the Trustee and
Securities Administrator..................................110
Section 9.09 Successor Trustee and Successor Securities Administrator..111
Section 9.10 Merger or Consolidation of Trustee or
Securities Administrator..................................112
Section 9.11 Appointment of Co-Trustee or Separate Trustee.............112
Section 9.12 Federal Information Returns and Reports to
Certificateholders; REMIC Administration..................113
ARTICLE X
Termination
Section 10.01 Termination Upon Repurchase by the Depositor,
▇▇▇▇▇▇▇▇▇ or its Designee or Liquidation of
the Mortgage Loans........................................116
Section 10.02 Additional Termination Requirements.......................118
ARTICLE XI
Miscellaneous Provisions
Section 11.01 Intent of Parties.........................................120
Section 11.02 Amendment.................................................120
Section 11.03 Recordation of Agreement..................................121
Section 11.04 Limitation on Rights of Certificateholders................121
Section 11.05 Acts of Certificateholders................................122
Section 11.06 Governing Law.............................................123
Section 11.07 Notices...................................................123
Section 11.08 Severability of Provisions................................124
Section 11.09 Successors and Assigns....................................124
Section 11.10 Article and Section Headings..............................124
Section 11.11 Counterparts..............................................124
Section 11.12 Notice to Rating Agencies.................................124
Section 11.13 Derivative Transactions...................................125
EXHIBITS
Exhibit A-1 - Form of Class A Certificates
Exhibit A-2 - Form of Class M Certificates
Exhibit A-3 - Form of Class B-IO Certificates
Exhibit A-4 - Form of Class R Certificates
Exhibit B - Mortgage Loan Schedule
Exhibit C-1 - Form of Initial Certification
Exhibit C-2 - Form of Interim Certification
Exhibit C-3 - Form of Final Certification
Exhibit D - Request for Release of Documents
Exhibit E - Form of Affidavit pursuant to Section 860E(e)(4)
Exhibit F-1 - Form of Investment Letter
Exhibit F-2 - Form of Rule 144A and Related Matters Certificate
Exhibit G - Form of Custodial Agreement
Exhibit H - List of Servicers and Servicing Agreements
Exhibit I - Mortgage Loan Purchase Agreement
Exhibit J - Certificate of Trust
Exhibit K - Notice of Exercise of Optional Securities Purchase Right
TRUST, POOLING AND SERVICING AGREEMENT
Trust, Pooling and Servicing Agreement (this "Agreement"), dated as of
March 1, 2004, among Structured Asset Mortgage Investments II Inc., a Delaware
corporation, as depositor (the "Depositor"), Deutsche Bank National Trust
Company, a national banking association, not in its individual capacity but
solely as trustee (the "Trustee"), Deutsche Bank Trust Company Delaware, a
Delaware banking corporation, not in its individual capacity but solely as
Delaware trustee (the "Delaware Trustee"), ▇▇▇▇▇ Fargo Bank, N.A., a national
banking association, as master servicer (in such capacity, the "Master
Servicer") and as securities administrator (in such capacity, the "Securities
Administrator"), and ▇▇▇▇▇▇▇▇▇ Mortgage Home Loans, Inc. ("▇▇▇▇▇▇▇▇▇").
PRELIMINARY STATEMENT
On March 29, 2004 the Depositor formed ▇▇▇▇▇▇▇▇▇ Mortgage Securities
Trust 2004-1, as a Delaware statutory trust (the "Trust") pursuant to the Trust
Agreement, dated March 29, 2004 (the "Original Trust Agreement"), among the
Depositor, the Trustee and the Delaware Trustee.
The parties to this Agreement desire to amend and restate the Original
Trust Agreement in its entirety, and, as evidenced by their signatures hereto,
the Original Trust Agreement is hereby amended, restated and replaced in its
entirety as of the date first written above by this Agreement.
Through this Agreement, the Depositor intends to cause the issuance
and sale of the Trust's Mortgage Pass-Through Certificates, Series 2004-1 (the
"Certificates") representing in the aggregate the entire beneficial ownership of
the Trust, the primary assets of which are the Mortgage Loans (as defined
below).
On or prior to the Closing Date, the Depositor acquired the Mortgage
Loans from ▇▇▇▇▇▇▇▇▇. On the Closing Date, the Depositor will sell the Mortgage
Loans and certain other property to the Trust and receive in consideration
therefor Certificates evidencing the entire beneficial ownership interest in the
Trust.
The Trustee on behalf of the Trust shall make an election for the
assets constituting REMIC I to be treated for federal income tax purposes as a
REMIC. On the Startup Day, the REMIC I Regular Interests will be designated
"regular interests" in such REMIC and the Class R-1 Certificate will be
designated the "residual interest" in such REMIC.
The Trustee on behalf of the Trust shall make an election for the
assets constituting REMIC II to be treated for federal income tax purposes as a
REMIC. On the Startup Day, the REMIC II Regular Interests will be designated
"regular interests" in such REMIC and the Class R-2 Certificate will be
designated the "residual interest" in such REMIC.
The Mortgage Loans will have an Outstanding Principal Balance as of
the Cut-off Date, after deducting all Scheduled Principal due on or before the
Cut-off Date, of $1,106,707,889.20. The initial principal amount of the
Certificates will not exceed the sum of such Outstanding Principal Balance and
the cash deposit made on the Closing Date pursuant to Section 2.01(a).
In consideration of the mutual agreements herein contained, the
Depositor, the Master Servicer, the Securities Administrator, ▇▇▇▇▇▇▇▇▇, the
Delaware Trustee and the Trustee agree as follows:
ARTICLE I
Definitions
Whenever used in this Agreement, the following words and phrases,
unless otherwise expressly provided or unless the context otherwise requires,
shall have the meanings specified in this Article.
ACCEPTED MASTER SERVICING PRACTICES: With respect to any Mortgage
Loan, as applicable, either (x) those customary mortgage servicing practices of
prudent mortgage servicing institutions that master service mortgage loans of
the same type and quality as such Mortgage Loan in the jurisdiction where the
related Mortgaged Property is located, to the extent applicable to the Trustee
or the Master Servicer (except in its capacity as successor to a Servicer), or
(y) as provided in the applicable Servicing Agreement, to the extent applicable
to any Servicer, but in no event below the standard set forth in clause (x).
ACCOUNT: The Master Servicer Collection Account, the Distribution
Account and each Servicer Account as the context may require.
ADDITIONAL COLLATERAL: With respect to any Additional Collateral
Mortgage Loan, the marketable securities or other assets subject to a security
interest pursuant to a related pledge agreement.
ADDITIONAL COLLATERAL MORTGAGE LOAN: Each Mortgage Loan identified as
such in the Mortgage Loan Schedule and as to which Additional Collateral is then
required to be provided as security therefor.
AFFILIATE: As to any Person, any other Person controlling, controlled
by or under common control with such Person. "Control" means the power to direct
the management and policies of a Person, directly or indirectly, whether through
ownership of voting securities, by contract or otherwise. "Controlled" and
"Controlling" have meanings correlative to the foregoing. The Trustee may
conclusively presume that a Person is not an Affiliate of another Person unless
a Responsible Officer of the Trustee has actual knowledge to the contrary.
AGGREGATE EXPENSE RATE: With respect to any Mortgage Loan, the sum of
the applicable Servicing Fee Rate, the Master Servicing Fee Rate, the Trustee
Fee Rate and the Retained Interest Rate (if applicable).
AGREEMENT: This Trust, Pooling and Servicing Agreement and all
amendments hereof and supplements hereto.
APPLICABLE CREDIT RATING: For any long-term deposit or security, a
credit rating of "AAA" in the case of S&P and "Aaa" in the case of ▇▇▇▇▇'▇. For
any short-term deposit or security, a rating of "A-l+" in the case of S&P and
P-1 in the case of ▇▇▇▇▇'▇.
APPLICABLE MARGIN: The Class I-1A Margin, the Class I-2A Margin or the
Class I-M Margin, as applicable.
APPLICABLE STATE LAW: For purposes of Section 9.12(d), the Applicable
State Law shall be (a) the law of the State of Delaware and (b) such other state
law whose applicability shall have been brought to the attention of the
Securities Administrator and the Trustee by either (i) an Opinion of Counsel
reasonably acceptable to the Securities Administrator and the Trustee delivered
to it by the Master Servicer, ▇▇▇▇▇▇▇▇▇ or the Depositor, or (ii) written notice
from the appropriate taxing authority as to the applicability of such state law.
APPLIED REALIZED LOSS AMOUNT: With respect to either Class of
Subordinate Certificates and as to any Distribution Date, the sum of the
Realized Losses with respect to the Mortgage Loans in the related Loan Group
which have been applied in reduction of the Current Principal Amount of such
Class which shall, on any such Distribution Date, equal with respect to either
such Class, so long as its Current Principal Amount has not been reduced to
zero, the amount, if any, by which, (i) the aggregate Current Principal Amount
of all of the Certificates of the related Certificate Group (after all
distributions of principal on such Distribution Date) exceeds (ii) the aggregate
Scheduled Principal Balance of all of the Mortgage Loans in the related Loan
Group as of the last day of the related Due Period; PROVIDED, HOWEVER, that if
the aggregate Scheduled Principal Balance of all of the Mortgage Loans of the
Loan Group related to the other Class of Subordinate Certificates as of the last
day of the related due period exceeds the aggregate Current Principal Amounts of
all of the Certificates of the Certificate Group related to such other Class of
Subordinate Certificates (after all distributions of principal on such
Distribution Date), then such Applied Realized Loss Amount shall equal the
amount, if any, by which, (i) the aggregate Current Principal Amounts of all of
the Certificates (after all distributions of principal on such Distribution
Date) exceeds (ii) the aggregate Scheduled Principal Balance of all of the
Mortgage Loans as of the last day of the related Due Period.
APPRAISED VALUE: For any Mortgaged Property related to a Mortgage
Loan, the amount, if any, set forth as the appraised value of such Mortgaged
Property in any appraisal made for the mortgage originator in connection with
its origination of the related Mortgage Loan.
ASSUMED FINAL DISTRIBUTION DATE: The Distribution Date in March 2044.
BASIS RISK SHORTFALL: As of any Distribution Date and for any Class of
Group I Certificates, the excess of (i) the amount of Current Interest that such
Class would have been entitled to receive on such Distribution Date had the
applicable Pass-Through Rate been calculated based upon the lesser of 10.750%
and LIBOR plus the Applicable Margin for the related Interest Accrual Period
over (ii) the interest for such Class calculated at the Interest Rate Cap for
such Distribution Date, expressed as a per annum rate.
BASIS RISK SHORTFALL CARRY FORWARD AMOUNT: As of any Distribution Date
and for any Class of Group I Certificates, the sum of (i) if on such
Distribution Date the applicable Pass-Through Rate for such Class is based upon
the Interest Rate Cap, the applicable Basis Risk Shortfall; and (ii) the Basis
Risk Shortfall for all previous Distribution Dates not previously paid
(including interest accrued thereon at the applicable Pass-Through Rate for the
applicable Interest Accrual Period with respect to each such prior Distribution
Date), together with interest thereon at a rate equal to the applicable
Pass-Through Rate for such Distribution Date.
BOOK-ENTRY CERTIFICATES: Any Certificate registered in the name of the
Depository or its nominee, beneficial interests in which are reflected on the
books and records of the Depository or on the books of a Person maintaining an
account with such Depository (directly or indirectly as an indirect participant
in accordance with the rules of such Depository). Initially, all Classes of
Certificates other than the Private Certificates and the Residual Certificates.
BUSINESS DAY: Any day other than (i) a Saturday or a Sunday, or (ii) a
day on which the New York Stock Exchange or Federal Reserve is closed or on
which banking institutions or the jurisdiction in which the Trustee, the Master
Servicer, any Servicer or the Securities Administrator are authorized or
obligated by law or executive order to be closed.
CALENDAR QUARTER: January 1 through March 31, April 1 through June 30,
July 1 through September 30, or October 1 through December 31, as applicable.
CERTIFICATE: Any mortgage pass-through certificate evidencing a
beneficial ownership interest in the Trust signed and authenticated by the
Trustee in substantially the forms annexed hereto as Exhibits ▇-▇, ▇-▇, ▇-▇ and
A-4, with the blanks therein appropriately completed.
CERTIFICATE GROUP: The Group I Certificates or the Group II
Certificates, as applicable.
CERTIFICATE OWNER: Any Person who is the beneficial owner of a
Certificate registered in the name of the Depository or its nominee.
CERTIFICATE REGISTER: The register maintained pursuant to Section
5.02.
CERTIFICATEHOLDER: A Holder of a Certificate.
CLASS: With respect to the Certificates, any of the Classes designated
as Class I-1A, Class I-2A, Class II-1A, Class II-2A, Class II-3A, Class II-4A,
Class I-M, Class II-M, Class R-1, Class R-2 and Class B-IO.
CLASS I-1A CERTIFICATE: Any Certificate designated as a "Class I-1A
Certificate" on the face thereof, in the form of Exhibit A-1 hereto,
representing the right to its share of distributions provided for the Class I-1A
Certificates as set forth in Section 6.03.
CLASS I-1A MARGIN: For any Distribution Date (i) on or prior to the
Optional Securities Purchase Date, 0.27% per annum and (ii) thereafter, 0.54%
per annum.
CLASS I-1A PASS-THROUGH RATE: For the first Distribution Date, 1.36%
per annum, and on any Distribution Date thereafter, LIBOR for the related
Interest Accrual Period plus the Class I-1A Margin for such Distribution Date,
subject to the lesser of (i) the applicable Interest Rate Cap for such
Distribution Date and (ii) 10.750% per annum.
CLASS I-2A CERTIFICATE: Any Certificate designated as a "Class I-2A
Certificate" on the face thereof, in the form of Exhibit A-1 hereto,
representing the right to its share of distributions provided for the Class I-2A
Certificates as set forth in Section 6.03.
CLASS I-2A MARGIN: For any Distribution Date (i) on or prior to the
Optional Securities Purchase Date, 0.45% per annum and (ii) thereafter, 0.90%
per annum.
CLASS I-2A PASS-THROUGH RATE: For the first Distribution Date, 1.54%
per annum, and on any Distribution Date thereafter, LIBOR for the related
Interest Accrual Period plus the Class I-2A Margin for such Distribution Date,
subject to the lesser of (i) the applicable Interest Rate Cap for such
Distribution Date and (ii) 10.750% per annum.
CLASS I-M CERTIFICATE: Any Certificate designated as a "Class I-M
Certificate" on the face thereof, in the form of Exhibit A-2 hereto,
representing the right to its share of distributions provided for the Class I-M
Certificates as set forth in Section 6.03.
CLASS I-M MARGIN: For any Distribution Date (i) on or prior to the
Optional Securities Purchase Date, 0.58% per annum and (ii) thereafter, 0.87%
per annum.
CLASS I-M PASS-THROUGH RATE: For the first Distribution Date, 1.67%
per annum, and for any Distribution Date thereafter, LIBOR for the related
Interest Accrual Period plus the Class I-M Margin for such Distribution Date,
subject to the lesser of (i) the applicable Interest Rate Cap for such
Distribution Date and (ii) 10.750% per annum.
CLASS I-M PRINCIPAL DISTRIBUTION AMOUNT: With respect to any
applicable Distribution Date, an amount equal to the excess, if any, of (i) the
sum of (a) the aggregate Current Principal Amount of the Group I Senior
Certificates (after taking into account the payment of the Group I Senior
Principal Distribution Amount on such Distribution Date) and (b) the Current
Principal Amount of the Class I-M Certificates immediately prior to such
Distribution Date over (ii) the lesser of (a) the product of (i) 99.50% and (ii)
the aggregate Scheduled Principal Balance of the Group I Mortgage Loans as of
the last day of the related Due Period (after reduction for Realized Losses
incurred during the related Prepayment Period), and (b) the aggregate Scheduled
Principal Balance of the Group I Mortgage Loans as of the last day of the
related due period (after reduction for Realized Losses incurred during the
related Prepayment Period) minus the Specified Overcollateralization Amount for
Loan Group I. On each Distribution Date on and after which the aggregate Current
Principal Amount of the Group I Senior Certificates has been reduced to zero,
the Class I-M Principal Distribution Amount will equal 100% of the Group I
Principal Distribution Amount.
CLASS II-1A CERTIFICATE: Any Certificate designated as a "Class II-1A
Certificate" on the face thereof, in the form of Exhibit A-1 hereto,
representing the right to its share of distributions provided for the Class
II-1A Certificates as set forth in Section 6.03.
CLASS II-1A PASS-THROUGH RATE: For the first Distribution Date,
2.6657% per annum, and for each Distribution Date thereafter, the weighted
average of the Net Rates as of the last day of the related Due Period of the
Subgroup II-1 Mortgage Loans, minus (i) on or before the Distribution Date in
December 2006, 1.3050% per annum, and (ii) after the Distribution Date in
December 2006, 0.6525% per annum.
CLASS II-2A CERTIFICATE: Any Certificate designated as a "Class II-2A
Certificate" on the face thereof, in the form of Exhibit A-1 hereto,
representing the right to its share of distributions provided for the Class
II-2A Certificates as set forth in Section 6.03.
CLASS II-2A PASS-THROUGH RATE: For the first Distribution Date,
3.3661% per annum, and for each Distribution Date thereafter, the weighted
average of the Net Rates as of the last day of the related Due Period of the
Subgroup II-2 Mortgage Loans, minus (i) on or before the Distribution Date in
December 2008, 1.2650% per annum, and (ii) after the Distribution Date in
December 2008, 0.6325% per annum.
CLASS II-3A CERTIFICATE: Any Certificate designated as a "Class II-3A
Certificate" on the face thereof, in the form of Exhibit A-1 hereto,
representing the right to its share of distributions provided for the Class
II-3A Certificates as set forth in Section 6.03.
CLASS II-3A PASS-THROUGH RATE: For the first Distribution Date,
3.7210% per annum, and for each Distribution Date thereafter, the weighted
average of the Net Rates as of the last day of the related Due Period of the
Subgroup II-3 Mortgage Loans, minus (i) on or before the Distribution Date in
October 2010, 1.1320% per annum, and (ii) after the Distribution Date in October
2010, 0.5660% per annum.
CLASS II-4A CERTIFICATE: Any Certificate designated as a "Class II-4A
Certificate" on the face thereof, in the form of Exhibit A-1 hereto,
representing the right to its share of distributions provided for the Class
II-4A Certificates as set forth in Section 6.03.
CLASS II-4A PASS-THROUGH RATE: For the first Distribution Date,
4.3010% per annum, and for each Distribution Date thereafter, the weighted
average of the Net Rates as of the last day of the related Due Period of the
Subgroup II-4 Mortgage Loans, minus (i) on or before the Distribution Date in
January 2014, 0.9490% per annum, and (ii) after the Distribution Date in January
2014, 0.4745% per annum.
CLASS II-M CERTIFICATE: Any Certificate designated as a "Class II-M
Certificate" on the face thereof, in the form of Exhibit A-2 hereto,
representing the right to its share of distributions provided for the Class II-M
Certificates as set forth in Section 6.03.
CLASS II-M PASS-THROUGH RATE: For the first Distribution Date, 4.1906%
per annum, and for each Distribution Date thereafter, the weighted average of
the Net Rates as of the last day of the related Due Period of the Mortgage Loans
in each Loan Subgroup, weighted in proportion to the excess, if any, of the
aggregate Scheduled Principal Balance of the Mortgage Loans in Loan Subgroup
II-1, Loan Subgroup II-2, Loan Subgroup II-3 and Loan Subgroup II-4 over the
Current Principal Amount of the Class II-1A, Class II-2A, Class II-3A and Class
I-4A Certificates, respectively, minus 0.3770% per annum.
CLASS II-M PRINCIPAL DISTRIBUTION AMOUNT: With respect to any
applicable Distribution Date, an amount equal to the excess, if any, of (i) the
sum of (a) the aggregate Current Principal Amount of the Group II Senior
Certificates (after taking into account the payment of the Group II Senior
Principal Distribution Amount on such Distribution Date) and (b) the Current
Principal Amount of the Class II-M Certificates immediately prior to such
Distribution Date over (ii) the lesser of (a) the product of (i) 99.50% and (ii)
the aggregate Scheduled Principal Balance of the Group II Mortgage Loans as of
the last day of the related Due Period (after reduction for Realized Losses
incurred during the related Prepayment Period), and (b) the aggregate Scheduled
Principal Balance of the Group II Mortgage Loans as of the last day of the
related due period (after reduction for Realized Losses incurred during the
related Prepayment Period) minus the Specified Overcollateralization Amount for
Loan Group II. On each Distribution Date on and after which the aggregate
Current Principal Amount of the Group II Senior Certificates has been reduced to
zero, the Class II-M Principal Distribution Amount will equal 100% of the Group
II Principal Distribution Amount.
CLASS B-IO CERTIFICATE: Any Certificate designated as a "Class B-IO
Certificate" on the face thereof, in the form of Exhibit A-3 hereto,
representing the right to its share of distributions provided for the Class B-IO
Certificates as set forth in Section 6.03.
CLASS B-IO DISTRIBUTION AMOUNT: With respect to any Distribution Date,
an amount equal to the cumulative amount allocable to the Class B-IO
Certificates as provided in Section 5.01(d), note 4, plus the sum of the Initial
Overcollateralization Amounts for Loan Group I and Loan Group II, less prior
distributions thereof to the Class B-IO Certificates. Payments will be
considered first allocable to interest to the extent payable pursuant to Section
5.01(d), note (4), and then to principal. Payments of the Class B-IO
Distribution Amount shall first be made pursuant to Section 6.01(b)(iii)(SIXTH)
and then pursuant to Section 6.01(b)(vi)(FOURTH).
CLASS B-IO NOTIONAL AMOUNT: With respect to the Class B-IO
Certificates, initially $1,106,707,889.20, and on any Distribution Date
thereafter, the aggregate Scheduled Principal Balance of the Mortgage Loans as
of the last day of the related Due Period.
CLASS M CERTIFICATES: The Class I-M Certificates and the Class II-M
Certificates.
CLASS R CERTIFICATES: The Class R-1 and Class R-2 Certificates.
CLASS R-1 CERTIFICATE: Any Certificate designated as a "Class R-1
Certificate" on the face thereof, in substantially the form set forth in Exhibit
A-4 hereto, and evidencing ownership of the residual interest in REMIC I and
representing the right to the distributions provided for the Class R-1
Certificate as set forth in Section 6.03.
CLASS R-2 CERTIFICATE: Any Certificate designated as a "Class R-2
Certificate" on the face thereof, in substantially the form set forth in Exhibit
A-4 hereto, and evidencing ownership of the residual interest in REMIC II and
representing the right to the distributions provided for the Class R-2
Certificate as set forth in Section 6.03.
CLOSING DATE: March 31, 2004.
CODE: The Internal Revenue Code of 1986, as amended.
COMPENSATING INTEREST PAYMENT: With respect to any Distribution Date,
the aggregate amount required to be paid in respect of Interest Shortfalls
(other than any shortfalls resulting from application of the Relief Act) by the
Servicers under the Servicing Agreements, with respect to such Distribution
Date, or by the Master Servicer pursuant to Section 6.07 for such Distribution
Date.
CONVERTED MORTGAGE LOAN: Any Convertible Mortgage Loan as to which the
related Mortgagor has exercised the right to convert the Mortgage Rate from an
adjustable to a fixed rate.
CONVERTIBLE MORTGAGE LOAN: Any Mortgage Loan which, at the option of
the Mortgagor and in accordance with the terms of the related Mortgage Note, may
have the related Mortgage Rate converted from an adjustable rate to a fixed
rate.
COOPERATIVE CORPORATION: The entity that holds title (fee or an
acceptable leasehold estate) to the real property and improvements constituting
the Cooperative Property and which governs the Cooperative Property, which
Cooperative Corporation must qualify as a Cooperative Housing Corporation under
Section 216 of the Code.
COOPERATIVE LOAN: Any Mortgage Loan secured by Cooperative Shares and
a Proprietary Lease.
COOPERATIVE LOAN DOCUMENTS: As to any Cooperative Loan, (i) the
Cooperative Shares, together with a stock power in blank; (ii) the original
executed Security Agreement and the assignment of the Security Agreement
endorsed in blank; (iii) the original executed Proprietary Lease and the
assignment of the Proprietary Lease endorsed in blank; (iv) the original
executed Recognition Agreement and the assignment of the Recognition Agreement
(or a blanket assignment of all Recognition Agreements) endorsed in blank; (v)
the executed UCC-1 financing statement with evidence of recording thereon, which
has been filed in all places required to perfect the security interest in the
Cooperative Shares and the Proprietary Lease; and (vi) executed UCC-3 financing
statements (or copies thereof) or other appropriate UCC financing statements
required by state law, evidencing a complete and unbroken line from the
mortgagee to the Trust with evidence of recording thereon (or in a form suitable
for recordation).
COOPERATIVE PROPERTY: The real property and improvements owned by the
Cooperative Corporation, that includes the allocation of individual dwelling
units to the holders of the Cooperative Shares of the Cooperative Corporation.
COOPERATIVE SHARES: Shares issued by a Cooperative Corporation.
COOPERATIVE UNIT: A single-family dwelling located in a Cooperative
Property.
CORPORATE TRUST OFFICE: The office of the Trustee (x) maintained for
registration of transfer and exchange of Certificates, which at the date of
execution of this Agreement, is located at c/o DTC Transfer Agent Services, ▇▇
▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇ ▇▇▇▇ Entrance, New York, New York 10041, or (y)
otherwise, at which at any particular time its corporate trust business is
administered, which office, at the date of the execution of this Agreement, is
located at ▇▇▇▇ ▇▇▇▇ ▇▇. ▇▇▇▇▇▇ ▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇, ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇, Attention:
▇▇▇▇▇▇▇▇▇ 2004-1 (TM0401).
CORRESPONDENT SELLERS GUIDE: The Mortgage Loan Seller's Correspondent
Sellers Guide, revised March 2002 and as revised from time to time.
CURRENT INTEREST: With respect to each Class of Group I Certificates
and Group II Certificates and each Distribution Date, (i) the interest accrued
at the applicable Pass-Through Rate (including for such purpose any application
of an Interest Rate Cap with respect to the Group I Certificates) for the
applicable Interest Accrual Period on the Current Principal Amount of such Class
plus (ii) any amount previously distributed with respect to interest for such
Class that is recovered as a voidable preference by a trustee in bankruptcy,
reduced by (iii) any Net Interest Shortfalls with respect to the related Loan
Group, provided, that for purposes of calculating Current Interest for any such
Class, amounts specified in clause (iii) hereof for any such Distribution Date
shall be allocated first to the Class B-IO Certificates and the Residual
Certificates in reduction of amounts otherwise distributable to such Classes on
such Distribution Date and then to each Class of Certificates of such
Certificate Group, pro rata, based on the respective amounts of interest accrued
pursuant to clause (i) hereof with respect to each such Class for such
Distribution Date.
CURRENT PRINCIPAL AMOUNT: With respect to each Class of Certificates
and any Distribution Date, the original principal balance of such Class on the
Closing Date, less the sum of (i) all amounts in respect of principal
distributed to such Class on previous Distribution Dates and (ii) in the case of
each Class of Subordinate Certificates, any Applied Realized Loss Amounts
allocated to such Class on previous Distribution Dates and increased by (iii) in
the case of each Class of Subordinate Certificates, any Subsequent Recoveries
allocated to that Class on previous Distribution Dates pursuant to Section
6.02(c). Notwithstanding the foregoing, solely for purposes of giving consents,
directions, waivers, approvals, requests and notices based on the Fractional
Undivided Interest of a Certificate of each of the Class R-1 and Class R-2
Certificates, the Class R-1 and Class R-2 Certificates after the Distribution
Date on which they each receive the distribution of the last dollar of their
respective original principal amount shall be deemed to have Current Principal
Amounts equal to their respective Current Principal Amounts on the day
immediately preceding such Distribution Date.
CUSTODIAL AGREEMENT: A Custodial Agreement entered into by the Trustee
and a successor Custodian, substantially in the form of Exhibit G hereto.
CUSTODIAN: The Trustee, acting in its capacity as custodian of the
Mortgage Loans hereunder, or any successor custodian appointed pursuant to a
Custodial Agreement.
CUT-OFF DATE: March 1, 2004.
CUT-OFF DATE BALANCE: With respect to all the Mortgage Loans,
$1,106,707,889.20, and with respect to the Group I Mortgage Loans and Group II
Mortgage Loans, $363,324,594.26 and $743,383,294.94, respectively.
DELAWARE STATUTORY TRUST STATUTE: As defined in Section 1A.03 hereof.
DELAWARE TRUSTEE: Deutsche Bank Trust Company Delaware.
DELINQUENCY EVENT: A Delinquency Event shall have occurred and be
continuing with respect to a Loan Group if, as of a Distribution Date on or
after the Stepdown Date (i) the three-month rolling average of the aggregate
Scheduled Principal Balance of the Mortgage Loans in such Loan Group that are 60
days or more delinquent or are in bankruptcy or foreclosure or are REO
Properties, as a percentage of the aggregate Scheduled Principal Balance of all
of the Mortgage Loans in such Loan Group as of the last day of the related Due
Period, equals or exceeds (ii) 50% of the aggregate Current Principal Amount of
the Subordinate Certificates in the related Certificate Group plus the
Overcollateralization Amount for such Loan Group on such Distribution Date,
after taking into account the distribution of the Group I and Group II Principal
Distribution Amounts on such Distribution Date, as a percentage of the aggregate
Scheduled Principal Balance of the Mortgage Loans in such Loan Group as of the
last day of the related Due Period.
DEPOSITOR: Structured Asset Mortgage Investments II Inc., a Delaware
corporation, or its successors in interest.
DEPOSITORY: The Depository Trust Company, the nominee of which is Cede
& Co., or any successor thereto.
DEPOSITORY AGREEMENT: The meaning specified in Subsection 5.01(a)
hereof.
DEPOSITORY PARTICIPANT: A broker, dealer, bank or other financial
institution or other Person for whom from time to time the Depository effects
book-entry transfers and pledges of securities deposited with the Depository.
DETERMINATION DATE: The date each month, as set forth in the related
Servicing Agreement, on which a Servicer determines the amount of all funds
(including, without limitation, Monthly Advances and Compensating Interest
Payments) required to be remitted to the Master Servicer on the related Servicer
Remittance Date with respect to the Mortgage Loans it is servicing.
DISQUALIFIED ORGANIZATION: Any of the following: (i) the United
States, any State or political subdivision thereof, any possession of the United
States, or any agency or instrumentality of any of the foregoing (other than an
instrumentality which is a corporation if all of its activities are subject to
tax and, except for the ▇▇▇▇▇▇▇ Mac or any successor thereto, a majority of its
board of directors is not selected by such governmental unit), (ii) any foreign
government, any international organization, or any agency or instrumentality of
any of the foregoing, (iii) any organization (other than certain farmers'
cooperatives described in Section 521 of the Code) which is exempt from the tax
imposed by Chapter 1 of the Code (including the tax imposed by Section 511 of
the Code on unrelated business taxable income), (iv) rural electric and
telephone cooperatives described in Section 1381(a)(2)(C) of the Code or (v) any
other Person so designated by the Trustee based upon an Opinion of Counsel that
the holding of an ownership interest in a Residual Certificate by such Person
may cause any REMIC contained in the Trust or any Person having an ownership
interest in the Residual Certificate (other than such Person) to incur a
liability for any federal tax imposed under the Code that would not otherwise be
imposed but for the transfer of an ownership interest in a Residual Certificate
to such Person. The terms "United States," "State" and "international
organization" shall have the meanings set forth in Section 7701 of the Code or
successor provisions.
DISTRIBUTION ACCOUNT: The trust account or accounts created and
maintained pursuant to Section 4.04, which shall be denominated "Deutsche Bank
National Trust Company, as Trustee f/b/▇ ▇▇▇▇▇▇▇▇▇ Mortgage Securities Trust
2004-1, Mortgage Pass-Through Certificates, Series 2004-1 - Distribution
Account."
DISTRIBUTION ACCOUNT DEPOSIT DATE: With respect to each Distribution
Date, the Business Day immediately preceding such Distribution Date.
DISTRIBUTION DATE: The 25th day of any month, beginning in April 2004,
or, if such 25th day is not a Business Day, the Business Day immediately
following.
DTC CUSTODIAN: Deutsche Bank National Trust Company, or its successors
in interest as custodian for the Depository.
DUE DATE: With respect to any Mortgage Loan, the date in each month on
which its Scheduled Payment is due if such due date is the first day of a month
and otherwise is deemed to be the first day of the following month, or such
other date specified in the related Servicing Agreement.
DUE PERIOD: With respect to any Distribution Date and as to any
Mortgage Loan, the period commencing on the second day of the month preceding
the calendar month in which such Distribution Date occurs and ending at the
close of business on the first day of the month in which such Distribution Date
occurs.
ELIGIBLE ACCOUNT: Either (i) an account or accounts maintained with a
federal or state chartered depository institution or trust company acceptable to
each Rating Agency, including any account maintained at ▇▇▇▇▇ Fargo Bank, N.A.,
or at Deutsche Bank National Trust Company, or (ii) an account or accounts the
deposits in which are insured by the FDIC to the limits established by such
corporation, provided that any such deposits not so insured shall be maintained
in an account at a depository institution or trust company whose commercial
paper or other short term debt obligations (or, in the case of a depository
institution or trust company which is the principal subsidiary of a holding
company, the commercial paper or other short term debt or deposit obligations of
such holding company or depository institution, as the case may be) have been
rated by each Rating Agency in its highest short-term rating category, or (iii)
a segregated trust account or accounts (which shall be a "special deposit
account") maintained with the Trustee or any other federal or state chartered
depository institution or trust company, acting in its fiduciary capacity, in a
manner acceptable to the Trustee and each Rating Agency. Eligible Accounts may
bear interest unless otherwise specified herein.
EMPLOYEE LOAN: Any Mortgage Loan identified as such in the Mortgage
Loan Schedule, which provides for an increase in the Mortgage Rate thereof in
the event of the change of employment of the Mortgagor thereunder.
ERISA: The Employee Retirement Income Security Act of 1974, as
amended.
EVENT OF DEFAULT: An event of default described in Section 8.01.
▇▇▇▇▇▇ ▇▇▇: ▇▇▇▇▇▇ ▇▇▇ (also known as the Federal National Mortgage
Association) or any successor thereto.
FDIC: Federal Deposit Insurance Corporation or any successor thereto.
FINAL CERTIFICATION: The certification substantially in the form of
Exhibit C-3 hereto.
FIVE-YEAR HYBRID MORTGAGE LOANS: Those Mortgage Loans designated on
the Mortgage Loan Schedule as hybrid adjustable rate mortgage loans, with an
initial fixed rate period of five years, which constitute Subgroup II-2 Mortgage
Loans.
FRACTIONAL UNDIVIDED INTEREST: With respect to any Class of
Certificates, the fractional undivided interest evidenced by any Certificate of
such Class, which is a fraction (i) in the case of the Class B-IO Certificates,
the numerator of which is the Class B-IO Notional Amount of such Class B-IO
Certificate and the denominator of which is the aggregate Class B-IO Notional
Amount of all Class B-IO Certificates and (ii) in the case of any other such
Class, the numerator of which is the Current Principal Amount of such
Certificate and the denominator of which is the Current Principal Amount of such
Class. With respect to the Certificates in the aggregate, the fractional
undivided interest evidenced by (i) a Residual Certificate will be deemed to
equal 1% multiplied by the percentage interest of such Residual Certificate,
(ii) a Class B-IO Certificate, 2% times a fraction, the numerator of which is
the Class B-IO Notional Amount of such Certificate and the denominator of which
is the aggregate Class B-IO Notional Amount of all Class B-IO Certificates and
(iii) a Certificate of any other Class will be deemed to equal 96% multiplied by
a fraction, the numerator of which is the Current Principal Amount of such
Certificate and the denominator of which is the aggregate Current Principal
Amount of all such Certificates.
▇▇▇▇▇▇▇ MAC: ▇▇▇▇▇▇▇ Mac (also known as the Federal Home Loan Mortgage
Corporation) or any successor thereto.
GROSS MARGIN: As to each Mortgage Loan, the fixed percentage set forth
in the related Mortgage Note and indicated on the Mortgage Loan Schedule which
percentage is added to the related Index on each Interest Adjustment Date to
determine (subject to rounding, the minimum and maximum Mortgage Rate and the
Periodic Rate Cap) the Mortgage Rate until the next Interest Adjustment Date.
GROUP I CERTIFICATES: The Group I Senior Certificates and the Class
I-M Certificates.
GROUP I CROSSED LOSS AMOUNT: with respect to any Distribution Date, is
the lesser of (a) the excess, if any, of any Realized Losses on the Group I
Mortgage Loans incurred during the related Prepayment Period over the Group I
Loss Amount and (b) the excess, if any, of the Interest Funds for Loan Group II
for that Distribution Date over the sum of (i) Current Interest on the Classes
of Group II Certificates, (ii) Interest Carry Forward Amounts on the Group II
Senior Certificates and (iii) the Group II Loss Amount in each case, for that
Distribution Date.
GROUP I EXCESS CASHFLOW: With respect to any Distribution Date, the
Group I Excess Spread less any Group I Extra Principal Distribution Amount, in
each case for such Distribution Date.
GROUP I EXCESS SPREAD: With respect to any Distribution Date, the
excess, if any, of the Interest Funds for Loan Group I for that Distribution
Date over the sum of (i) Current Interest on the Classes of Group I
Certificates, (ii) Interest Carry Forward Amounts on the Group I Senior
Certificates, (iii) the Group I Loss Amount and (iv) the Group II Crossed Loss
Amount, in each case for that Distribution Date.
GROUP I EXTRA PRINCIPAL DISTRIBUTION AMOUNT: With respect to any
Distribution Date, the lesser of (a) the excess, if any, of the Specified
Overcollateralization Amount for Loan Group I for that Distribution Date over
the Overcollateralization Amount for Loan Group I for that Distribution Date
(after giving effect to distributions of principal on the Classes of Group I
Certificates other than any Group I Extra Principal Distribution Amount or Group
II Excess Cashflow) and (b) the Group I Excess Spread for that Distribution
Date.
GROUP I LOSS AMOUNT: With respect to any Distribution Date, the lesser
of (a) any Realized Losses on the Group I Mortgage Loans incurred during the
related Prepayment Period and (b) the excess, if any, of the Interest Funds for
Loan Group I for that Distribution Date over the sum of Current Interest on the
Classes of Group I Certificates and Interest Carry Forward Amounts on the Group
I Senior Certificates on that Distribution Date.
GROUP I MORTGAGE LOAN: Any Subgroup I-1 or Subgroup I-2 Mortgage Loan.
GROUP I PRINCIPAL DISTRIBUTION AMOUNT: With respect to any
Distribution Date, the sum of the Principal Funds for Loan Group I for that
Distribution Date plus any Group I Extra Principal Distribution Amount for that
Distribution Date.
GROUP I SENIOR CERTIFICATE: Any Class I-1A or Class I-2A Certificate.
GROUP I SENIOR PRINCIPAL DISTRIBUTION AMOUNT: With respect to any
applicable Distribution Date, an amount equal to the excess, if any, of (i) the
aggregate Current Principal Amount of the Group I Senior Certificates
immediately prior to that Distribution Date, over (ii) the lesser of (a) the
product of (i) 94.9% and (ii) the aggregate Scheduled Principal Balance of the
Group I Mortgage Loans as of the last day of the related Due Period (after
reduction for Realized Losses incurred during the related Prepayment Period)
over (b) the aggregate Scheduled Principal Balance of the Group I Mortgage Loans
as of the last day of the related Due Period (after reduction for Realized
Losses incurred during the related Prepayment Period) minus the Specified
Overcollateralization Amount for Loan Group I.
GROUP II CERTIFICATES: The Group II Senior Certificates and the Class
II-M Certificates.
GROUP II CROSSED LOSS AMOUNT: with respect to any Distribution Date,
is the lesser of (a) the excess, if any, of any Realized Losses on the Group II
Mortgage Loans incurred during the related Prepayment Period over the Group II
Loss Amount and (b) the excess, if any, of the Interest Funds for Loan Group I
for that Distribution Date over the sum of (i) Current Interest on the Classes
of Group I Certificates, (ii) Interest Carry Forward Amounts on the Group I
Senior Certificates and (iii) the Group I Loss Amount in each case, for the
Distribution Date.
GROUP II EXCESS CASHFLOW: With respect to any Distribution Date, the
Group II Excess Spread less any Group II Extra Principal Distribution Amount, in
each case for such Distribution Date.
GROUP II EXCESS SPREAD: With respect to any Distribution Date, the
excess, if any, of the Interest Funds for Loan Group II for that Distribution
Date over the sum of (i) Current Interest on the Classes of Group II
Certificates, (ii) Interest Carry Forward Amounts on the Group II Senior
Certificates, (iii) the Group II Loss Amount and (iv) the Group I Crossed Loss
Amount, in each case for that Distribution Date.
GROUP II EXTRA PRINCIPAL DISTRIBUTION AMOUNT: With respect to any
Distribution Date, the lesser of (a) the excess, if any, of the Specified
Overcollateralization Amount for Loan Group II for that Distribution Date over
the Overcollateralization Amount for Loan Group II for that Distribution Date
(after giving effect to distributions of principal on the Classes of Group II
Certificates other than any Group II Extra Principal Distribution Amount or
Group I Excess Cashflow) and (b) the Group II Excess Spread for that
Distribution Date.
GROUP II LOSS AMOUNT: With respect to any Distribution Date, the
lesser of (a) any Realized Losses on the Group II Mortgage Loans incurred during
the related Prepayment Period and (b) the excess, if any, of the Interest Funds
for Loan Group II for that Distribution Date over the sum of Current Interest on
the Classes of Group II Certificates and Interest Carry Forward Amounts on the
Group II Senior Certificates on that Distribution Date.
GROUP II MORTGAGE LOAN: Any Subgroup II-1, Subgroup II-2, Subgroup
II-3 or Subgroup II-4 Mortgage Loan.
GROUP II PRINCIPAL DISTRIBUTION AMOUNT: With respect to any
Distribution Date, the sum of the Principal Funds for Loan Group II for that
Distribution Date plus any Group II Extra Principal Distribution Amount for that
Distribution Date.
GROUP II SENIOR CERTIFICATE: Any Class II-1A, Class II-2A, Class II-3A
or Class II-4A Certificate.
GROUP II SENIOR PRINCIPAL DISTRIBUTION AMOUNT: With respect to any
applicable Distribution Date, an amount equal to the excess, if any, of (i) the
aggregate Current Principal Amount of the Group II Senior Certificates
immediately prior to that Distribution Date, over (ii) the lesser of (a) the
product of (i) 94.8% and (ii) the aggregate Scheduled Principal Balance of the
Group II Mortgage Loans as of the last day of the related Due Period (after
reduction for Realized Losses incurred during the related Prepayment Period)
over (b) the aggregate Scheduled Principal Balance of the Group II Mortgage
Loans as of the last day of the related Due Period (after reduction for Realized
Losses incurred during the related Prepayment Period) minus the Specified
Overcollateralization Amount for Loan Group II.
HOLDER: The Person in whose name a Certificate is registered in the
Certificate Register except that, subject to Subsections 11.02(b) and 11.05(e)
solely for the purpose of giving any consent pursuant to this Agreement, any
Certificate registered in the name of the Depositor, the Master Servicer or the
Trustee or any Affiliate thereof shall be deemed not to be outstanding and the
Fractional Undivided Interest evidenced thereby shall not be taken into account
in determining whether the requisite percentage of Fractional Undivided Interest
evidenced thereby necessary to effect any such consent has been obtained.
INDEMNIFIED PERSONS: The Trustee, the Delaware Trustee, the Master
Servicer, the Depositor and the Securities Administrator and their officers,
directors, agents, employees and affiliates and with respect to the Trustee, any
separate co trustee and its officers, directors, agents, employees and
affiliates.
INDEPENDENT: When used with respect to any specified Person, this term
means that such Person (a) is in fact independent of the Depositor or the Master
Servicer and of any Affiliate of the Depositor or the Master Servicer, (b) does
not have any direct financial interest or any material indirect financial
interest in the Depositor or the Master Servicer or any Affiliate of the
Depositor or the Master Servicer and (c) is not connected with the Depositor or
the Master Servicer or any Affiliate as an officer, employee, promoter,
underwriter, trustee, partner, director or person performing similar functions.
INDEX: The index, if any, specified in a Mortgage Note by reference to
which the related Mortgage Rate will be adjusted from time to time.
INDIVIDUAL CERTIFICATE: Any Private Certificate registered in the name
of a Holder other than the Depository or its nominee. The Class B-IO
Certificates will be issued as Individual Certificates.
INITIAL CERTIFICATION: The certification substantially in the form of
Exhibit C-1 hereto.
INITIAL OVERCOLLATERALIZATION AMOUNT: With respect to Loan Group I,
$94.26 and with respect to Loan Group II, $294.94.
INSTITUTIONAL ACCREDITED INVESTOR: Any Person meeting the requirements
of Rule 501(a)(l), (2), (3) or (7) of Regulation D under the Securities Act or
any entity all of the equity holders in which come within such paragraphs.
INSURANCE POLICY: With respect to any Mortgage Loan, any standard
hazard insurance policy, flood insurance policy, title insurance policy or
Primary Mortgage Insurance Policy and, with respect to an Additional Collateral
Mortgage Loan originated by MLCC, the MLCC Limited Purpose Surety Bond.
INSURANCE PROCEEDS: Amounts paid by the insurer under any Insurance
Policy covering any Mortgage Loan or Mortgaged Property other than (i) amounts
required to be paid over to the Mortgagor pursuant to law or the related
Mortgage Note or Security Instrument, (ii) amounts used to repair or restore the
Mortgaged Property or to reimburse insured expenses and (iii) Subsequent
Recoveries.
INTEREST ACCRUAL PERIOD: With respect to each Distribution Date, (i)
for each Class of Group I Certificates, the period from and including the prior
Distribution Date (or the Closing Date, in the case of the Distribution Date in
April 2004) to but excluding such Distribution Date and (ii) for each Class of
Group II Certificates, the calendar month preceding the month in which such
Distribution Date occurs.
INTEREST ADJUSTMENT DATE: With respect to a Mortgage Loan, the date,
if any, specified in the related Mortgage Note on which the Mortgage Rate is
subject to adjustment.
INTEREST CARRY FORWARD AMOUNT: With respect to each Class of
Certificates (other than the Class B-IO Certificates and the Residual
Certificates) and each Distribution Date, the sum of (i) the excess of (a)
Current Interest for such Class with respect to prior Distribution Dates, over
(b) the amount of interest actually distributed to such Class on such prior
Distribution Dates and (ii) interest on such excess (to the extent permitted by
applicable law), at the applicable Pass-Through Rate for the related Interest
Accrual Period, including the Interest Accrual Period relating to such
Distribution Date.
INTEREST DETERMINATION DATE: With respect to each Class of Group I
Certificates, for the first Interest Accrual Period, March 29, 2004, and with
respect to any Interest Accrual Period thereafter, the second LIBOR Business Day
preceding the commencement of such Interest Accrual Period.
INTEREST FUNDS: With respect to a Distribution Date and a Loan Group,
an amount equal to the following amounts with respect to Mortgage Loans in a
Loan Group: (i) the sum, without duplication, of (a) all interest (exclusive of
any Prepayment Penalty Amounts) received during the related Due Period, less the
related Servicing Fee of the Servicer and the Master Servicing Fee, (b) all
Monthly Advances relating to interest, (c) all Compensating Interest, (d) Net
Liquidation Proceeds and Insurance Proceeds received in the related Prepayment
Period, to the extent they relate to interest, (e) the interest portion of
proceeds of the repurchase of any Mortgage Loans by ▇▇▇▇▇▇▇▇▇ pursuant to
Sections 2.02, 2.03 or 3.21 and by TMI pursuant to Section 3.21, (f) the
interest portion of the purchase price of the assets of the Trust upon exercise
by ▇▇▇▇▇▇▇▇▇ Mortgage Home Loans, Inc., as a Servicer, of its Optional
Termination Right and (g) the interest portion of any amounts received under the
MLCC Limited Purpose Surety Bond, less (ii) any Retained Interest, the Trustee
Fee and other amounts relating to interest and allocated to such Loan Group
withdrawn pursuant to Sections 4.03 or 4.05 and used to reimburse the Trustee,
the Delaware Trustee, the Securities Administrator, the Master Servicer or any
Servicer for amounts due under this Agreement or the applicable Servicing
Agreement that have not been retained by or paid to such party.
INTEREST RATE CAP: For any Distribution Date and (i) the Class I-1A
and Class I-2A Certificates, the weighted average of the Net Rates of the
Subgroup I-1 and Subgroup I-2 Mortgage Loans, respectively, as of the last day
of the related Due Period, and (ii) the Class I-M Certificates, the weighted
average of the Net Rates of the Mortgage Loans in each Loan Subgroup, weighted
in proportion to the excess, if any, of the aggregate Scheduled Principal
Balance of the Mortgage Loans in Loan Subgroup I-1 and Loan Subgroup I-2 over
the Current Principal Amount of the Class I-1A and Class I-2A Certificates,
respectively.
INTEREST SHORTFALL: With respect to any Distribution Date and each
Mortgage Loan that during the related Prepayment Period was the subject of a
Principal Prepayment or constitutes a Relief Act Mortgage Loan, an amount
determined as follows:
(a) Partial principal prepayments received during the relevant
Prepayment Period: The difference between (i) one month's interest at the
applicable Net Rate on the amount of such prepayment and (ii) the amount of
interest for the calendar month of such prepayment (adjusted to the applicable
Net Rate) received at the time of such prepayment;
(b) Principal prepayments in full received during the relevant
Prepayment Period: The difference between (i) one month's interest at the
applicable Net Rate on the Scheduled Principal Balance of such Mortgage Loan
immediately prior to such prepayment and (ii) the amount of interest for the
calendar month of such prepayment (adjusted to the applicable Net Rate) received
at the time of such prepayment; and
(c) As to any Relief Act Mortgage Loan, the excess of (i) 30 days'
interest (or, in the case of a principal prepayment in full, interest to the
date of prepayment) on the Scheduled Principal Balance thereof (or, in the case
of a principal prepayment in part, on the amount so prepaid) at the related Net
Rate over (ii) 30 days' interest (or, in the case of a principal prepayment in
full, interest to the date of prepayment) on such Scheduled Principal Balance
(or, in the case of a Principal Prepayment in part, on the amount so prepaid) at
the Net Rate required to be paid by the Mortgagor as limited by application of
the Relief Act.
INTERIM CERTIFICATION: The certification substantially in the form of
Exhibit C-2 hereto.
INTERVENING ASSIGNMENT: The meaning set forth in Subsection
2.01(b)(vi).
INVESTMENT LETTER: The letter to be furnished by each Institutional
Accredited Investor which purchases any of the Private Certificates in
connection with such purchase, substantially in the form set forth as Exhibit
F-1 hereto; provided that ▇▇▇▇▇▇▇▇▇ or any of its Affiliates shall not be
required to furnish an Investment Letter in connection with the initial
registration or subsequent transfer to an Affiliate of the Private Certificates.
LIBOR: With respect to any Interest Accrual Period, the rate
determined by the Securities Administrator on the related Interest Determination
Date on the basis of the rate for U.S. dollar deposits for one month that
appears on Telerate Screen Page 3750 as of 11:00 a.m. (London time) on such
Interest Determination Date; provided that the parties hereto acknowledge that
LIBOR for the first Interest Accrual Period shall equal 1.09% per annum. If such
rate does not appear on such page (or such other page as may replace that page
on that service, or if such service is no longer offered, such other service for
displaying LIBOR or comparable rates as may be reasonably selected by the
Securities Administrator), LIBOR for the applicable Interest Accrual Period will
be the Reference Bank Rate. If no such quotations can be obtained by the
Securities Administrator and no Reference Bank Rate is available, LIBOR will be
LIBOR applicable to the preceding Interest Accrual Period. The establishment of
LIBOR on each Determination Date by the Securities Administrator and the
Securities Administrator's calculation of the rate of interest applicable to the
Certificates bearing interest based on LIBOR shall, in the absence of manifest
error, be conclusive and binding.
LIBOR BUSINESS DAY: A day on which banks are open for dealing in
foreign currency and exchange in London and New York City.
LIQUIDATED MORTGAGE LOAN: Any defaulted Mortgage Loan as to which the
related Servicer or the Master Servicer has determined that all amounts it
expects to recover from or on account of such Mortgage Loan have been recovered.
LIQUIDATION DATE: With respect to any Liquidated Mortgage Loan, the
date on which the Master Servicer or the related Servicer has certified that
such Mortgage Loan has become a Liquidated Mortgage Loan.
LIQUIDATION EXPENSES: With respect to a Mortgage Loan in liquidation,
unreimbursed expenses paid or incurred by or for the account of the Master
Servicer or the related Servicers, such expenses including (a) property
protection expenses, (b) property sales expenses, (c) foreclosure and sale
costs, including court costs and reasonable attorneys' fees, and (d) similar
expenses reasonably paid or incurred in connection with liquidation.
LIQUIDATION PROCEEDS: Cash (including Insurance Proceeds) received in
connection with the liquidation of a defaulted Mortgage Loan, whether through
trustee's sale, foreclosure sale, condemnation proceeds or otherwise, or the
sale of the related Mortgaged Property and any related Additional Collateral if
the Mortgaged Property and such Additional Collateral is acquired in
satisfaction of the Mortgage Loan, including any amounts remaining in the
related Servicer Account, exclusive of Subsequent Recoveries.
LOAN GROUP: Loan Group I or Loan Group II, as applicable.
LOAN GROUP I: The Subgroup I-1 and Subgroup I-2 Loans.
LOAN GROUP II: The Subgroup II-1, Subgroup II-2, Subgroup II-3 and
Subgroup II-4 Loans.
LOAN SUBGROUP: Any of Loan Subgroup I-1, Loan Subgroup I-2, Loan
Subgroup II-1, Loan Subgroup II-2, Loan Subgroup II-3 or Loan Subgroup II-4.
LOAN SUBGROUP I-1 or SUBGROUP I-1 LOANS: The Mortgage Loans included
as such on the Mortgage Loan Schedule.
LOAN SUBGROUP I-2 or SUBGROUP I-2 LOANS: The Mortgage Loans included
as such on the Mortgage Loan Schedule.
LOAN SUBGROUP II-1 or SUBGROUP II-1 LOANS: The Mortgage Loans included
as such on the Mortgage Loan Schedule.
LOAN SUBGROUP II-2 or SUBGROUP II-2 LOANS: The Mortgage Loans included
as such on the Mortgage Loan Schedule.
LOAN SUBGROUP II-3 or SUBGROUP II-3 LOANS: The Mortgage Loans included
as such on the Mortgage Loan Schedule.
LOAN SUBGROUP II-4 or SUBGROUP II-4 LOANS: The Mortgage Loans included
as such on the Mortgage Loan Schedule.
LOAN-TO-VALUE RATIO: With respect to any Mortgage Loan, the fraction,
expressed as a percentage, the numerator of which is the original principal
balance of the related Mortgage Loan and the denominator of which is the
Original Value of the related Mortgaged Property.
LOSS EVENT: With respect to each Loan Group, as of the last day of the
related Due Period, for the Distribution Date in each of the months indicated,
Realized Losses on the Mortgage Loans in such Loan Group since the Closing Date,
as a percentage of the aggregate Scheduled Principal Balance of the Mortgage
Loans in such Loan Group on the Closing Date, exceed, for (i) 37 months through
48 months following the Closing Date, 0.25%; (ii) 49 months through 72 months
following the Closing Date, 0.50%; and (iii) 73 months following the Closing
Date and each month thereafter, 0.75%.
LOST NOTE AFFIDAVIT: With respect to any Lost Note (and, if not in the
Seller's possession, the related Mortgage File), an affidavit from ▇▇▇▇▇▇▇▇▇ or
one of its affiliates (which may be in blanket form with respect to some or all
Lost Notes) certifying that the original Mortgage Note has been lost, misplaced
(including, in the case of certain Mortgage Loans, as to which the Mortgage File
has been released to the related Servicer and not returned) or destroyed
(together with a copy of the related Mortgage Note, if available) and
indemnifying the Depositor, the Trustee and the Trust against any loss, cost or
liability resulting from the failure to deliver the original Mortgage Note.
LOST NOTES: Any Mortgage Loan as to which the original Mortgage Note
has been lost, misplaced (including, in the case of certain Mortgage Loans, as
to which the Mortgage File has been released to the related Servicer and not
returned) or destroyed and has not been replaced, as indicated on the Mortgage
Loan Schedule.
MASTER SERVICER: As of the Closing Date, ▇▇▇▇▇ Fargo Bank, N.A. and,
thereafter, its respective successors in interest which meet the qualifications
of this Agreement.
MASTER SERVICER CERTIFICATION: A written certification covering
servicing of the Mortgage Loans by all Servicers and signed by an officer of the
Master Servicer that complies with (i) the ▇▇▇▇▇▇▇▇-▇▇▇▇▇ Act of 2002, as
amended from time to time, and (ii) the February 21, 2003 Statement by the Staff
of the Division of Corporation Finance of the Securities and Exchange Commission
Regarding Compliance by Asset-Backed Issuers with Exchange Act Rules 13a-14 and
15d-14, as in effect from time to time; provided that if, after the Closing Date
(a) the ▇▇▇▇▇▇▇▇-▇▇▇▇▇ Act of 2002 is amended, (b) the Statement referred to in
clause (ii) is modified or superceded by any subsequent statement, rule or
regulation of the Securities and Exchange Commission or any statement of a
division thereof, or (c) any future releases, rules and regulations are
published by the Securities and Exchange Commission from time to time pursuant
to the ▇▇▇▇▇▇▇▇-▇▇▇▇▇ Act of 2002, which in any such case affects the form or
substance of the required certification and results in the required
certification being, in the reasonable judgment of the Master Servicer,
materially more onerous than the form of the required certification as of the
Closing Date, the Master Servicer Certification shall be as agreed to by the
Master Servicer, the Depositor and the Seller following a negotiation in good
faith to determine how to comply with any such new requirements.
MASTER SERVICER COLLECTION ACCOUNT: The trust account or accounts
created and maintained pursuant to Section 4.02, which shall be denominated
"Deutsche Bank National Trust Company, as Trustee f/b/▇ ▇▇▇▇▇▇▇▇▇ Mortgage
Securities Trust 2004-1, Mortgage Pass-Through Certificates, Series 2004-1 -
Master Servicer Collection Account."
MASTER SERVICING FEE: As to any Distribution Date and each Mortgage
Loan, an amount equal to the product of one-twelfth of the Master Servicing Fee
Rate and the aggregate Scheduled Principal Balances of the Mortgage Loans as of
the first day of the related Due Period. As additional compensation and as to
any Distribution Date, the Master Servicer shall be entitled to receive certain
income and gain realized from the investment of funds on deposit in the Master
Servicer Collection Account to the extent provided in Section 4.02(c).
MASTER SERVICING FEE RATE: 0.0150% per annum.
MASTER SERVICING GUIDE: ▇▇▇▇▇ Fargo Conduit and Norwest Conduit
Servicing Guide, dated January, 1997, as amended July 2001.
MAXIMUM LIFETIME MORTGAGE RATE: The maximum level to which a Mortgage
Rate can adjust in accordance with its terms, regardless of changes in the
applicable Index.
MERS: Mortgage Electronic Registration Systems, Inc., a corporation
organized and existing under the laws of the State of Delaware, or any successor
thereto.
MERS MORTGAGE LOAN: Any Mortgage Loan as to which (i) the related
Security Instrument or related assignment, has been or will be recorded in the
name of MERS, as agent for the holder from time to time of the Mortgage Note,
and (ii) such Mortgage Loan has been or will be registered on the MERS System.
MERS SYSTEM: The electronic registration system maintained by MERS.
MINIMUM LIFETIME MORTGAGE RATE: The minimum level to which a Mortgage
Rate can adjust in accordance with its terms, regardless of changes in the
applicable Index.
MLCC: ▇▇▇▇▇▇▇ ▇▇▇▇▇ Credit Corp., a Delaware corporation, and its
successors and assigns.
MLCC LIMITED PURPOSE SURETY BOND: A limited purpose surety bond,
Policy No. AB0039BE, issued by AMBAC Assurance Corporation to guarantee certain
shortfalls in net proceeds realized from liquidation of Additional Collateral
(as defined therein) for an Additional Collateral Mortgage Loan (as defined
therein) originated by MLCC.
MLCC MORTGAGE LOAN: A Mortgage Loan originated by MLCC.
MODIFIABLE MORTGAGE LOANS: Any Mortgage Loan which, at the option of
the Mortgagor and in accordance with the terms of the related Mortgage Note, may
have the related Mortgage Rate modified to any adjustable rate or hybrid product
offered at the time by the related originator.
MODIFIED MORTGAGE LOANS: Any Modifiable Mortgage Loan as to which the
related Mortgagor has exercised the right to modify the Mortgage Rate.
MODIFIED MORTGAGE LOAN SCHEDULE: With respect to each Distribution
Date, a schedule listing each Modifiable Mortgage Loan that has become a
Modified Mortgage Loan during the immediately preceding Due Period, and the
Repurchase Price for each such Modified Mortgage Loan.
MONTHLY ADVANCE: An advance of delinquent payments of principal or
interest with respect to a Mortgage Loan required to be made by the applicable
Servicer pursuant to the related Servicing Agreement or the Master Servicer
pursuant to Section 6.05.
MOODY'S: ▇▇▇▇▇'▇ Investors Service, Inc. and its successors in
interest.
MORTGAGE FILE: The mortgage documents listed in Section 2.01(b)
pertaining to a particular Mortgage Loan and any additional documents required
to be added to the Mortgage File pursuant to this Agreement.
MORTGAGE LOAN: A mortgage loan transferred and assigned to the Trustee
on behalf of the Trust pursuant to Section 2.01 or Section 2.04 and held as a
part of the Trust, as identified in the Mortgage Loan Schedule, including a
mortgage loan the property securing which has become an REO Property.
MORTGAGE LOAN PURCHASE AGREEMENT: The Mortgage Loan Purchase Agreement
dated as of March 1, 2004, between ▇▇▇▇▇▇▇▇▇, as seller, and Structured Asset
Mortgage Investments II Inc., as purchaser, and all amendments thereof and
supplements thereto.
MORTGAGE LOAN SCHEDULE: The schedule, attached hereto as Exhibit B
with respect to the Mortgage Loans and as amended from time to time to reflect
the repurchase or substitution of Mortgage Loans pursuant to this Agreement.
MORTGAGE NOTE: The originally executed note or other evidence of the
indebtedness of a Mortgagor under the related Mortgage Loan.
MORTGAGE RATE: The annual rate at which interest accrues from time to
time on any Mortgage Loan pursuant to the related Mortgage Note, which rate at
the Cut-Off Date is equal to the "Mortgage Rate" set forth with respect thereto
on the Mortgage Loan Schedule.
MORTGAGED PROPERTY: Either of (x) the fee simple interest in real
property, together with improvements thereto including any exterior improvements
to be completed within 120 days of disbursement of the related Mortgage Loan
proceeds, or (y) or, in the case of REO Property, such REO Property, or (z) in
the case of a Cooperative Loan, the related Cooperative Shares and Proprietary
Lease, securing the indebtedness of the Mortgagor under the related Mortgage
Loan.
MORTGAGOR: The obligor on a Mortgage Note.
NET INTEREST SHORTFALL: With respect to any Distribution Date, the
Interest Shortfall, if any, for such Distribution Date net of Compensating
Interest Payments made with respect to such Distribution Date.
NET LIQUIDATION PROCEEDS: As to any Liquidated Mortgage Loan,
Liquidation Proceeds net of (i) Liquidation Expenses which are payable therefrom
by the related Servicer or the Master Servicer in accordance with the related
Servicing Agreement or this Agreement, (ii) unreimbursed advances by the related
Servicer or the Master Servicer and (iii) Monthly Advances.
NET RATE: With respect to each Mortgage Loan, the Mortgage Rate in
effect from time to time less the Aggregate Expense Rate.
NON-MERS MORTGAGE LOAN: Any Mortgage Loan other than a MERS Mortgage
Loan.
NONRECOVERABLE ADVANCE: Any advance or Monthly Advance (i) which was
previously made or is proposed to be made by the Master Servicer, the Trustee
(as successor Master Servicer) or applicable Servicer and (ii) which, in the
good faith judgment of the Master Servicer, the Trustee or applicable Servicer,
will not or, in the case of a proposed advance or Monthly Advance, would not, be
ultimately recoverable by the Master Servicer, the Trustee (as successor Master
Servicer) or applicable Servicer from Liquidation Proceeds, Insurance Proceeds
or future payments on the Mortgage Loan for which such advance or Monthly
Advance was made.
OFFERED CERTIFICATE: Any Senior Certificate, Class M Certificate or
Class R Certificate.
OFFICER'S CERTIFICATE: A certificate signed by the Chairman of the
Board, the Vice Chairman of the Board, the President or a Vice President or
Assistant Vice President or other authorized officer of the Master Servicer or
the Depositor, as applicable, and delivered to the Trustee, as required by this
Agreement.
OPINION OF COUNSEL: A written opinion of counsel who is or are
acceptable to the Trustee and who, unless required to be Independent (an
"Opinion of Independent Counsel"), may be internal counsel for ▇▇▇▇▇▇▇▇▇, the
Master Servicer or the Depositor.
OPTIONAL SECURITIES PURCHASE DATE: The first Distribution Date that
the aggregate Scheduled Principal Balance of the Mortgage Loans as of the end of
the immediately preceding Due Period is equal to or less than 20% of the Cut-off
Date Balance.
OPTIONAL SECURITIES PURCHASE RIGHT: The right of ▇▇▇▇▇▇▇▇▇ to purchase
the outstanding Offered Certificates in accordance with Section 5.09.
OPTIONAL TERMINATION RIGHT: The right of ▇▇▇▇▇▇▇▇▇, in its capacity as
Servicer, to purchase all of the Mortgage Loans in accordance with Section
10.01.
ORIGINAL VALUE: The lesser of (i) the Appraised Value or (ii) the
sales price of a Mortgaged Property at the time of origination of a Mortgage
Loan, except in instances where either clauses (i) or (ii) is unavailable, the
other may be used to determine the Original Value, or if both clauses (i) and
(ii) are unavailable, Original Value may be determined from other sources
reasonably acceptable to the Depositor.
OUTSTANDING MORTGAGE LOAN: With respect to any Due Date, a Mortgage
Loan which, prior to such Due Date, was not the subject of a Principal
Prepayment in full, did not become a Liquidated Mortgage Loan and was not
purchased or replaced.
OUTSTANDING PRINCIPAL BALANCE: As of the time of any determination,
the principal balance of a Mortgage Loan remaining to be paid by the Mortgagor,
or, in the case of an REO Property, the principal balance of the related
Mortgage Loan remaining to be paid by the Mortgagor at the time such property
was acquired by the Trust less any Net Liquidation Proceeds with respect thereto
to the extent applied to principal.
OVERCOLLATERALIZATION AMOUNT: With respect to any Distribution Date
and Loan Group, the excess, if any, of (a) the aggregate Scheduled Principal
Balance of the Mortgage Loans in such Loan Group as of the last day of the
related Due Period over (b) the Current Principal Amount of the Offered
Certificates of the related Certificate Group on such Distribution Date (after
taking into account the payment of Principal Funds but not any Group I or Group
II Extra Principal Distribution Amount, as applicable, on such Certificates).
PASS-THROUGH RATE: The Class I-1A Pass-Through Rate, Class I-2A
Pass-Through Rate, Class II-1A Pass-Through Rate, Class II-2A Pass-Through Rate,
Class II-3A Pass-Through Rate, Class II-4A Pass-Through Rate, Class I-M
Pass-Through Rate or Class II-M Pass-Through Rate, as applicable.
PERIODIC RATE CAP: With respect to each Mortgage Loan, the maximum
adjustment that can be made to the Mortgage Rate on each Interest Adjustment
Date in accordance with its terms, regardless of changes in the applicable
Index.
PERMITTED INVESTMENTS: Any one or more of the following obligations or
securities held in the name of the Trustee for the benefit of the
Certificateholders:
(i) direct obligations of, and obligations the timely payment of
which are fully guaranteed by the United States of America or any
agency or instrumentality of the United States of America the
obligations of which are backed by the full faith and credit of the
United States of America;
(ii) (a) demand or time deposits, federal funds or bankers'
acceptances issued by any depository institution or trust company
incorporated under the laws of the United States of America or any
state thereof (including the Trustee or the Master Servicer each
acting in its commercial banking capacity) and subject to supervision
and examination by federal and/or state banking authorities, provided
that the commercial paper and/or the short-term debt rating and/or the
long-term unsecured debt obligations of such depository institution or
trust company at the time of such investment or contractual commitment
providing for such investment have the Applicable Credit Rating or
better from each Rating Agency and (b) any other demand or time
deposit or certificate of deposit that is fully insured by the Federal
Deposit Insurance Corporation;
(iii) repurchase obligations with respect to (a) any security
described in clause (i) above or (b) any other security issued or
guaranteed by an agency or instrumentality of the United States of
America, the obligations of which are backed by the full faith and
credit of the United States of America, in either case entered into
with a depository institution or trust company (acting as principal)
described in clause (ii)(a) above where the Trustee holds the security
therefor;
(iv) securities bearing interest or sold at a discount issued by
any corporation (including the Trustee or the Master Servicer)
incorporated under the laws of the United States of America or any
state thereof that have the Applicable Credit Rating or better from
each Rating Agency at the time of such investment or contractual
commitment providing for such investment; provided, however, that
securities issued by any particular corporation will not be Permitted
Investments to the extent that investments therein will cause the then
outstanding principal amount of securities issued by such corporation
and held as part of the Trust to exceed 10% of the aggregate
Outstanding Principal Balances of all the Mortgage Loans and Permitted
Investments held as part of the Trust;
(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 one year after the date of
issuance thereof) having the Applicable Credit Rating or better from
each Rating Agency at the time of such investment;
(vi) a Reinvestment Agreement issued by any bank, insurance
company or other corporation or entity;
(vii) any other demand, money market or time deposit, obligation,
security or investment as may be acceptable to each Rating Agency as
evidenced in writing by each Rating Agency to the Trustee; and
(viii) any money market or common trust fund having the
Applicable Credit Rating or better from each Rating Agency, including
any such fund for which the Trustee or Master Servicer or any
affiliate of the Trustee or Master Servicer acts as a manager or an
advisor; provided, however, that no instrument or security shall be a
Permitted Investment if such instrument or security evidences a right
to receive only interest payments with respect to the obligations
underlying such instrument or if such security provides for payment of
both principal and interest with a yield to maturity in excess of 120%
of the yield to maturity at par or if such instrument or security is
purchased at a price greater than par.
PERMITTED TRANSFEREE: Any Person other than a Disqualified
Organization or an "electing large partnership" (as defined by Section 775 of
the Code).
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 CERTIFICATE: Any Residual Certificate registered in the name
of a Holder that is not the Depository or its nominee.
PREPAYMENT PENALTY AMOUNT: With respect to the Mortgage Loans and each
Distribution Date, all premiums or charges, if any, paid by Mortgagors under the
related Mortgage Notes as a result of full or partial Principal Prepayments
collected by the applicable Servicer during the immediately preceding Prepayment
Period, but only to the extent required to be remitted to the Master Servicer on
the applicable Servicer Remittance Date under the terms of the related Servicing
Agreement.
PREPAYMENT PERIOD: With respect to any Mortgage Loan and any
Distribution Date, the immediately
preceding calendar month.
PRIMARY MORTGAGE INSURANCE POLICY: Each policy of primary mortgage
guaranty insurance or any replacement policy therefor with respect to any
Mortgage Loan.
PRINCIPAL FUNDS: With respect to a Distribution Date and each Loan
Group or Loan Subgroup, an amount equal to (i) the sum, without duplication, of
the following amounts with respect to Mortgage Loans in a Loan Group or Loan
Subgroup: (a) the Scheduled Principal collected during the related Due Period or
advanced by a Servicer or the Master Servicer on or before the related
Distribution Account Deposit Date, (b) prepayments, exclusive of any Prepayment
Penalty Amounts, collected in the related Prepayment Period, (c) the Scheduled
Principal Balance of each Mortgage Loan in such Loan Group or Loan Subgroup that
was repurchased by ▇▇▇▇▇▇▇▇▇ pursuant to Section 2.02, 2.03 or 3.21 or by TMI
pursuant to Section 3.21, (d) any Substitution Adjustment Amounts paid by the
Seller or similar amounts by any Servicer pursuant to its Servicing Agreement in
connection with delivery of a Substitute Mortgage Loan, (e) the principal
portion of all Net Liquidation Proceeds and Insurance Proceeds collected during
the related Prepayment Period and remitted to the Master Servicer Collection
Account less all non-recoverable Monthly Advances relating to principal
reimbursed pursuant to Section 4.03 or 4.05 and all Subsequent Recoveries
received during the related Prepayment Period, (f) the principal portion of the
purchase price of the assets of the Trust upon the exercise by ▇▇▇▇▇▇▇▇▇ of the
Optional Termination Right, (g) the Group I Loss Amount and the Group II Crossed
Loss Amount or the Group II Loss Amount and the Group I Crossed Loss Amount, as
applicable, and (h) the principal portion of any amounts received under the MLCC
Limited Purpose Surety Bond, less (ii) amounts relating to principal allocated
to such Loan Group or Loan Subgroup and used to provide expense reimbursements
pursuant to Section 4.03 or 4.05 and any losses on investments in the Master
Servicer Collection Account or the Distribution Account not reimbursed as
specified in Section 4.02 or 4.04.
PRINCIPAL PREPAYMENT: Any payment (whether partial or full) or other
recovery of principal on a Mortgage Loan which is received in advance of its
scheduled Due Date to the extent that it is not accompanied by an amount as to
interest representing scheduled interest due on any date or dates in any month
or months subsequent to the month of prepayment, including Insurance Proceeds
and the purchase price in connection with any purchase of a Mortgage Loan
pursuant to this Agreement, any cash deposit in connection with the substitution
of a Mortgage Loan, but excluding any Net Liquidation Proceeds.
PRIVATE CERTIFICATES: Any Class B-IO Certificate.
PROPRIETARY LEASE: With respect to any Cooperative Unit, a lease or
occupancy agreement between a Cooperative Corporation and a holder of related
Cooperative Shares.
PROSPECTUS SUPPLEMENT: The prospectus supplement dated March 29, 2004
relating to the offering of the Offered Certificates.
QIB: A Qualified Institutional Buyer as defined in Rule 144A
promulgated under the Securities Act.
QUALIFIED INSURER: Any insurance company duly qualified as such under
the laws of the state or states in which the related Mortgaged Property or
Mortgaged Properties is or are located, duly authorized and licensed in such
state or states to transact the type of insurance business in which it is
engaged and approved as an insurer by the Master Servicer, so long as the claims
paying ability of which is acceptable to each Rating Agency for pass-through
certificates having the same rating as the Certificates rated by each Rating
Agency as of the Closing Date.
RATING AGENCIES: S&P and Moody's.
REALIZED LOSS: With respect to a defaulted Mortgage Loan, the excess
of the Scheduled Principal Balance of such defaulted Mortgage Loan over the Net
Liquidation Proceeds with respect thereto that are allocated to principal.
RECOGNITION AGREEMENT: With respect to any Cooperative Loan, an
agreement between the related Cooperative Corporation and the originator of such
Mortgage Loan to establish the rights of such originator in the related
Cooperative Property.
RECORD DATE: With respect to any Distribution Date and the Group I
Certificates, so long as such Certificates are Book-Entry Certificates, the
Business Day preceding such Distribution Date, and otherwise, the close of
business on the last Business Day of the month preceding the month in which such
Distribution Date occurs. With respect to the Group II Certificates, the Class
B-IO Certificates and the Residual Certificates and (a) the first Distribution
Date, the Closing Date, and (b) with respect to any other Distribution Date, the
close of business on the last Business Day of the month preceding the month in
which such Distribution Date occurs.
REFERENCE BANKS: Leading banks selected by the Securities
Administrator and engaged in transactions in Eurodollar deposits in the
international Eurocurrency market (i) with an established place of business in
London, (ii) which have been designated as such by the Securities Administrator
and (iii) which are not controlling, controlled by, or under common control
with, the Seller, the Mortgage Loan Seller or the Master Servicer.
REINVESTMENT AGREEMENTS: One or more reinvestment agreements,
acceptable to each Rating Agency, from a bank, insurance company or other
corporation or entity (including the Trustee).
RELIEF ACT: The Servicemembers Civil Relief Act.
RELIEF ACT MORTGAGE LOAN: Any Mortgage Loan as to which the Scheduled
Payment thereof has been reduced due to the application of the Relief Act or
similar state or local laws.
REMIC: A real estate mortgage investment conduit, as defined in the
Code.
REMIC I: That group of assets contained in the Trust designated as a
REMIC consisting of (i) the Mortgage Loans (excluding any Retained Interest),
(ii) sums on deposit in any Account (exclusive of investment earnings thereon),
(iii) any REO Property relating to the Mortgage Loans, (iv) the rights with
respect to each Servicing Agreement (iv) the rights of the Trust with respect to
the Mortgage Loan Purchase Agreement, (v) the Additional Collateral, (vi) if any
of the Mortgage Loans are MLCC Mortgage Loans, the related rights under the MLCC
Limited Purpose Surety Bond and (vii) any proceeds of the foregoing.
REMIC I INTERESTS: The REMIC I Regular Interests and the Class R-1
Certificates.
REMIC I REGULAR INTERESTS: The REMIC I Regular Interests, as
identified and with such terms as described in Section 5.01(c).
REMIC I SUBORDINATED BALANCE RATIO: The ratio among the Uncertificated
Principal Balances of each of the REMIC I Regular Interests beginning with the
designation "X," equal to the ratio among:
(i) the excess of (x) the aggregate Scheduled Principal Balance
of the Mortgage Loans in Loan Subgroup I-1 over (y) the Current
Principal Amount of the Class II-1A Certificates;
(ii) the excess of (x) the aggregate Scheduled Principal Balance
of the Mortgage Loans in Loan Subgroup I-2 over (y) the Current
Principal Amount of the Class II-2A Certificates;
(iii) the excess of (x) the aggregate Scheduled Principal Balance
of the Mortgage Loans in Loan Subgroup II-1 over (y) the Current
Principal Amount of the Class II-1A Certificates;
(iv) the excess of (x) the aggregate Scheduled Principal Balance
of the Mortgage Loans in Loan Subgroup II-2 over (y) the Current
Principal Amount of the Class II-2A Certificates;
(v) the excess of (x) the aggregate Scheduled Principal Balance
of the Mortgage Loans in Loan Subgroup II-3 over (y) the Current
Principal Amount of the Class II-3A Certificates; and
(vi) the excess of (x) the aggregate Scheduled Principal Balance
of the Mortgage Loans in Loan Subgroup II-4 over (y) the Current
Principal Amount of the Class II-4A Certificates.
REMIC II: That group of assets contained in the Trust designated as a
REMIC consisting of the REMIC I Regular Interests.
REMIC II CERTIFICATES: The REMIC II Regular Interests and the Class
R-2 Certificates.
REMIC II REGULAR INTERESTS: The REMIC II Regular Interests as
identified and with such terms as described in Section 5.01(d).
REMIC OPINION: An Opinion of Independent Counsel, to the effect that
the proposed action described therein would not, under the REMIC Provisions, (i)
cause REMIC I or REMIC II to fail to qualify as a REMIC while any regular
interest in such REMIC is outstanding, (ii) result in a tax on prohibited
transactions with respect to any REMIC or (iii) constitute a taxable
contribution to any REMIC after the Startup Day.
REMIC PROVISIONS: The 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.
REO PROPERTY: A Mortgaged Property acquired in the name of the
Trustee, for the benefit of Certificateholders, by foreclosure or deed-in-lieu
of foreclosure in connection with a defaulted Mortgage Loan.
REPURCHASE PRICE: With respect to any Mortgage Loan (or any property
acquired with respect thereto) to be purchased by the Seller or TMI pursuant to
the Mortgage Loan Purchase Agreement or Article II or Section 3.21 of this
Agreement, an amount equal to the sum of (i) 100% of the Outstanding Principal
Balance of such Mortgage Loan as of the date of repurchase (or if the related
Mortgaged Property was acquired with respect thereto, 100% of the Outstanding
Principal Balance at the date of the acquisition), plus (ii) accrued but unpaid
interest on the Outstanding Principal Balance at the related Mortgage Rate,
through and including the last day of the month of repurchase plus (iii) any
premiums due the insurer under any Primary Mortgage Insurance Policy plus (iv)
in the case of a repurchase of such Mortgage Loan resulting from breach of a
representation or warranty contained in Section (vii) of Exhibit 3 to the
Mortgage Loan Purchase Agreement any costs or damages incurred by the Trust in
connection with the violation by such Mortgage Loan of any predatory or abusive
lending law reduced by (v) any portion of any Servicing Fee or the Master
Servicing Fee, Monthly Advances and advances payable to the purchaser of the
Mortgage Loan.
REQUEST FOR RELEASE: A request for release in the form attached hereto
as Exhibit D.
REQUIRED INSURANCE POLICY: With respect to any Mortgage Loan, any
insurance policy which is required to be maintained from time to time under this
Agreement with respect to such Mortgage Loan.
RESIDUAL CERTIFICATES: The Class R Certificates.
RESPONSIBLE OFFICER: When used with respect to the Trustee, any Vice
President, Assistant Vice President, Secretary, Assistant Secretary, Treasurer,
Assistant Treasurer, any trust officer or any other officer associated with the
Corporate Trust Office customarily performing functions similar to those
performed by any of the above designated officers and having direct
responsibility for the administration of this Agreement, and any other officer
of the Trustee to whom a matter arising hereunder may be referred because of
that officer's knowledge of and familiarity with the particular subject.
RETAINED INTEREST: Interest in respect of each Employee Loan, retained
by the Retained Interest Holder at the Retained Interest Rate.
RETAINED INTEREST HOLDER: With respect to each Employee Loan, the
Seller or any successor in interest by assignment or otherwise.
RETAINED INTEREST RATE: As of the Cut-off Date, and for each Due
Period thereafter, 0.00% per annum; provided, however, if the related Mortgagor
of the Employee Loan ceases to be an employee or a director of ▇▇▇▇▇▇▇▇▇ or its
Affiliates, the amount of the increase in the per annum rate set forth in the
related Mortgage Note.
RULE 144A CERTIFICATE: The certificate to be furnished with respect to
the purchase of a Private Certificate that is also an Individual Certificate by
a purchaser that is a Qualified Institutional Buyer as defined under Rule 144A
promulgated under the Securities Act, substantially in the form set forth as
Exhibit F-2 hereto; provided that ▇▇▇▇▇▇▇▇▇ or any of its Affiliates shall not
be required to furnish Rule 144A Certificate in connection with the initial
registration or subsequent transfer of the Private Certificates to ▇▇▇▇▇▇▇▇▇ or
an Affiliate of ▇▇▇▇▇▇▇▇▇, or from such Affiliate to ▇▇▇▇▇▇▇▇▇.
S&P: Standard & Poor's Ratings Services, a Division of The ▇▇▇▇▇▇-▇▇▇▇
Companies, Inc. and its successors in interest.
SCHEDULED PAYMENT: With respect to any Mortgage Loan and any Due
Period, the scheduled payment of principal and interest due during such Due
Period on such Mortgage Loan which either is payable by a Mortgagor in such Due
Period under the related Mortgage Note or, in the case of REO Property, would
otherwise have been payable under the related Mortgage Note.
SCHEDULED PRINCIPAL: The principal portion of any Scheduled Payment.
SCHEDULED PRINCIPAL BALANCE: For any Mortgage Loan or related REO
Property with respect to a Distribution Date, its principal balance as of the
Cut-Off Date minus the sum of (i) the principal portion of the Scheduled
Payments due from Mortgagors with respect to such Mortgage Loan during each Due
Period ending prior to such Distribution Date (and irrespective of any
delinquency in their payment), (ii) all Principal Prepayments with respect to
such Mortgage Loan received prior to or during the related Prepayment Period,
and all Net Liquidation Proceeds and Insurance Proceeds to the extent applied by
the related Servicer as recoveries of principal in accordance with Section 3.13
of this Agreement that were received by the related Servicer by the close of
business on the last day of the Prepayment Period related to such Distribution
Date, and (iii) any Realized Loss with respect to such Mortgage Loan incurred
during the related Prepayment Period. The Scheduled Principal Balance of any
Liquidated Mortgage Loan is zero.
SECURITIES ACT: The Securities Act of 1933, as amended.
SECURITIES ADMINISTRATOR: ▇▇▇▇▇ Fargo Bank, N.A., or its successor in
interest, or any successor securities administrator appointed as herein
provided.
SECURITIES LEGEND: [in the case of the Class B-IO Certificates:] THIS
CERTIFICATE HAS NOT BEEN AND WILL NOT BE REGISTERED UNDER THE SECURITIES ACT OF
1933, AS AMENDED (THE "SECURITIES ACT"), OR UNDER ANY STATE SECURITIES LAWS. THE
HOLDER HEREOF, BY PURCHASING THIS CERTIFICATE, AGREES THAT THIS CERTIFICATE MAY
BE REOFFERED, RESOLD, PLEDGED OR OTHERWISE TRANSFERRED ONLY IN COMPLIANCE WITH
THE SECURITIES ACT AND OTHER APPLICABLE LAWS AND ONLY (1) PURSUANT TO RULE 144A
UNDER THE SECURITIES ACT ("RULE 144A") TO A PERSON THAT THE HOLDER REASONABLY
BELIEVES IS A QUALIFIED INSTITUTIONAL BUYER WITHIN THE MEANING OF RULE 144A (A
"QIB"), PURCHASING FOR ITS OWN ACCOUNT OR A QIB PURCHASING FOR THE ACCOUNT OF A
QIB, WHOM THE HOLDER HAS INFORMED, IN EACH CASE, THAT THE REOFFER, RESALE,
PLEDGE OR OTHER TRANSFER IS BEING MADE IN RELIANCE ON RULE 144A, (2) PURSUANT TO
AN EXEMPTION FROM REGISTRATION PROVIDED BY RULE 144 UNDER THE SECURITIES ACT (IF
AVAILABLE) SUBJECT TO THE RECEIPT BY THE TRUSTEE OF A LETTER SUBSTANTIALLY IN
THE FORM PROVIDED IN THE AGREEMENT OR (3) IN CERTIFICATED FORM TO AN
"INSTITUTIONAL ACCREDITED INVESTOR" WITHIN THE MEANING THEREOF IN RULE
501(a)(1), (2), (3) or (7) OF REGULATION D UNDER THE ACT OR ANY ENTITY IN WHICH
ALL OF THE EQUITY OWNERS COME WITHIN SUCH PARAGRAPHS PURCHASING NOT FOR
DISTRIBUTION IN VIOLATION OF THE SECURITIES ACT, SUBJECT TO (A) THE RECEIPT BY
THE TRUSTEE OF A LETTER SUBSTANTIALLY IN THE FORM PROVIDED IN THE AGREEMENT AND
(B) THE RECEIPT BY THE TRUSTEE OF SUCH OTHER EVIDENCE ACCEPTABLE TO THE TRUSTEE
THAT SUCH REOFFER, RESALE, PLEDGE OR TRANSFER IS IN COMPLIANCE WITH THE
SECURITIES ACT AND OTHER APPLICABLE LAWS OR IN EACH CASE IN ACCORDANCE WITH ALL
APPLICABLE SECURITIES LAWS OF THE UNITED STATES AND ANY OTHER APPLICABLE
JURISDICTION.
[in the case of the Class R-1 and R-2, and Class B-IO Certificates
add:] THIS CERTIFICATE MAY NOT BE ACQUIRED DIRECTLY OR INDIRECTLY BY, OR ON
BEHALF OF, AN EMPLOYEE BENEFIT PLAN OR OTHER RETIREMENT ARRANGEMENT WHICH IS
SUBJECT TO TITLE I OF THE EMPLOYEE RETIREMENT INCOME SECURITY ACT OF 1974, AS
AMENDED, AND/OR SECTION 4975 OF THE INTERNAL REVENUE CODE OF 1986, AS AMENDED
[in the case of the Class B-IO Certificates also add:] UNLESS THE
PROPOSED TRANSFER AND/OR HOLDING OF A CERTIFICATE AND THE SERVICING, MANAGEMENT
AND/OR OPERATION OF THE TRUST AND ITS ASSETS: (I) WILL NOT RESULT IN ANY
PROHIBITED TRANSACTION WHICH IS NOT COVERED UNDER AN INDIVIDUAL OR CLASS
PROHIBITED TRANSACTION EXEMPTION, INCLUDING, BUT NOT LIMITED TO, PROHIBITED
TRANSACTION EXEMPTION ("PTE") 84-14, ▇▇▇ ▇▇-▇, ▇▇▇ ▇▇-▇▇, ▇▇▇ 95-60 OR PTE 96-23
AND (II) WILL NOT GIVE RISE TO ANY ADDITIONAL FIDUCIARY DUTIES ON THE PART OF
THE DEPOSITOR, THE SECURITIES ADMINISTRATOR, THE MASTER SERVICER, THE TRUSTEE OR
THE DELAWARE TRUSTEE OR ANY SERVICER WHICH WILL BE DEEMED REPRESENTED OR WILL BE
EVIDENCED BY A REPRESENTATION OR AN OPINION OF COUNSEL TO SUCH EFFECT AS
REQUIRED BY THE AGREEMENT REFERRED TO HEREIN.
SECURITY AGREEMENT: With respect to any Cooperative Loan, the
agreement between the owner of the related Cooperative Shares and the originator
of the related Mortgage Note that defines the terms of the security interest in
such Cooperative Shares and the related Proprietary Lease.
SECURITY INSTRUMENT: A written instrument creating a valid first lien
on a Mortgaged Property securing a Mortgage Note, which may be any applicable
form of mortgage, deed of trust, deed to secure debt or security deed, including
any riders or addenda thereto.
SELLER: ▇▇▇▇▇▇▇▇▇, as mortgage loan seller under the Mortgage Loan
Purchase Agreement.
SENIOR CERTIFICATE GROUP: Senior Certificate Group I or Senior
Certificate Group II, as applicable.
SENIOR CERTIFICATE GROUP I: The Class I-1A and Class I-2A
Certificates.
SENIOR CERTIFICATE GROUP II: The Class II-1A, Class II-2A, Class II-3A
and Class II-4A Certificates.
SENIOR CERTIFICATES: Senior Certificate Group I or Senior Certificates
Group II, as applicable.
SERVICER: Each of the several servicers of the Mortgage Loans as set
forth and as individually defined in Exhibit H hereto and any successors
thereto.
SERVICER ACCOUNT: Any account established and maintained for the
benefit of the Master Servicer or the Trust by each Servicer with respect to the
related Mortgage Loans and any REO Property, pursuant to the terms of the
respective Servicing Agreement.
SERVICER REMITTANCE DATE: With respect to each Mortgage Loan, the 18th
day of each month, or, if such day is not a Business Day, the next Business Day.
SERVICING AGREEMENTS: The servicing agreements relating to the
Mortgage Loans as set forth in Exhibit H hereto, servicing arrangements for any
Mortgage Loans under the Mortgage Loan Seller's Correspondents Sellers Guide,
and any other servicing agreement entered into between a successor servicer and
the Seller or the Trustee on behalf of the Trust pursuant to the terms hereof.
SERVICING CERTIFICATION: A written certification of a Servicer
(including the Master Servicer when acting as a direct servicer of Mortgage
Loans) provided to the Master Servicer or to such other Person as may be
providing the certification required by the ▇▇▇▇▇▇▇▇-▇▇▇▇▇ Act of 2002 as
back-up for such latter certification, in the form attached as an exhibit to or
provided for in the applicable Servicing Agreement.
SERVICING FEE: As to any Mortgage Loan and Distribution Date, an
amount equal to the product of (i) the Scheduled Principal Balance of such
Mortgage Loan as of the Due Date in the preceding calendar month and (ii) the
applicable Servicing Fee Rate.
SERVICING FEE RATE: As to any Mortgage Loan, a per annum rate as set
forth in the Mortgage Loan Schedule for the related Servicer.
SEVEN-YEAR HYBRID MORTGAGE LOANS: Those Mortgage Loans designated on
the Mortgage Loan Schedule as hybrid adjustable rate mortgage loans, with an
initial fixed rate period of seven years, which constitute Subgroup II-3
Mortgage Loans.
SIGNIFICANT MODIFICATION: The meaning given to such term in Section
3.21(b) hereto.
SIGNIFICANT MODIFICATION MORTGAGE LOAN: The meaning given to such term
in Section 3.21(b) hereto.
SPECIFIED OVERCOLLATERALIZATION AMOUNT: With respect to either Loan
Group, 0.25% of the Cut-off Date Balance of the Mortgage Loans in such Loan
Group.
STARTUP DAY: March 31, 2004.
STEPDOWN DATE: With respect to the Group I Certificates or the Group
II Certificates, the earlier to occur of (a) the Distribution Date on which the
aggregate Current Principal Amount of the Group I or Group II Senior
Certificates, as applicable, has been reduced to zero and (b) the later to occur
of (i) the Distribution Date occurring in April 2007 and (ii) the first
Distribution Date for which the Current Principal Amount of the Class I-M or
Class II-M Certificates, as applicable, plus the Overcollateralization Amount
for the related Loan Group for such Distribution Date divided by the aggregate
Scheduled Principal Balance of the Mortgage Loans in such Loan Group as of the
end of the related Due Period is greater than or equal to 5.10% for Loan Group I
or 5.20% for Loan Group II.
SUBGROUP I-1 MORTGAGE LOAN: Any Mortgage Loan that has been identified
as such on the Mortgage Loan Schedule.
SUBGROUP I-2 MORTGAGE LOAN: Any Mortgage Loan identified as such on
the Mortgage Loan Schedule.
SUBGROUP II-1 MORTGAGE LOAN: Any Mortgage Loan that has been
identified as such on the Mortgage Loan Schedule.
SUBGROUP II-2 MORTGAGE LOAN: Any Mortgage Loan identified as such on
the Mortgage Loan Schedule.
SUBGROUP II-3 MORTGAGE LOAN: Any Mortgage Loan that has been
identified as such on the Mortgage Loan Schedule.
SUBGROUP II-4 MORTGAGE LOAN: Any Mortgage Loan that has been
identified as such on the Mortgage Loan Schedule.
SUBORDINATE CERTIFICATE: A Class I-M Certificate or Class II-M
Certificates.
SUBSEQUENT RECOVERY: The recovery of any amount (including the release
of surplus funds held to cover expenses) in respect of, and after a Mortgage
Loan becomes, a Liquidated Mortgage Loan.
SUBSTITUTE MORTGAGE LOAN: A mortgage loan tendered to the Trustee on
behalf of the Trust pursuant to the related Servicing Agreement, the Mortgage
Loan Purchase Agreement or Section 2.04 of this Agreement, as applicable, in
each case, (i) which has an Outstanding Principal Balance not greater nor
materially less than the Mortgage Loan for which it is to be substituted; (ii)
which has a Mortgage Rate and Net Rate not less than, and not materially greater
than, such Mortgage Loan; (iii) which has a maturity date not materially earlier
or later than such Mortgage Loan and not later than the latest maturity date of
any Mortgage Loan; (iv) which is of the same property type and occupancy type as
such Mortgage Loan; (v) which has a Loan-to-Value Ratio not greater than the
Loan-to-Value Ratio of such Mortgage Loan; (vi) which is current in payment of
principal and interest as of the date of substitution; (vii) as to which the
payment terms do not vary in any material respect from the payment terms of the
Mortgage Loan for which it is to be substituted, (viii) is not a Cooperative
Loan unless such Mortgage Loan was a Cooperative Loan; (ix) which has a Gross
Margin, Periodic Rate Cap and Maximum Lifetime Mortgage Rate no less than those
of such Mortgage Loan, has the same Index and interval between Interest
Adjustment Dates as such Mortgage Loan, and a Minimum Lifetime Mortgage Rate no
lower than that of such Mortgage Loan; and (x) is a "qualified mortgage" as
defined in Section 860G(a)(3) of the Code; provided, however, that no mortgage
loan will be eligible to become a Substitute Mortgage Loan if its inclusion in
the Trust would be in violation of the provisions of Section 2.04 hereof.
SUBSTITUTION ADJUSTMENT AMOUNT: The meaning set forth in Section 2.04.
TAX ADMINISTRATION AND TAX MATTERS PERSON: The Securities
Administrator or any successor thereto or assignee thereof shall serve as tax
administrator hereunder and as agent for each Tax Matters Person. The Holder of
each Class of Residual Certificates shall be the Tax Matters Person for the
related REMIC, as more particularly set forth in Section 9.12 hereof.
TEN-YEAR HYBRID MORTGAGE LOANS: Those Mortgage Loans designated on the
Mortgage Loan Schedule as hybrid adjustable rate mortgage loans with an initial
fixed rate period of ten years, which constitute Subgroup II-4 Mortgage Loans.
THREE-YEAR HYBRID MORTGAGE LOANS: Those Mortgage Loans designated on
the Mortgage Loan Schedule as hybrid adjustable rate mortgage loans with an
initial fixed-rate period of three years, which constitute Subgroup II-1
Mortgage Loans.
TMI: ▇▇▇▇▇▇▇▇▇ Mortgage, Inc., a Maryland corporation, and its
successors and assigns.
TRIGGER EVENT: With respect to any Distribution Date on or after the
Stepdown Date, the occurrence of either a Delinquency Event or a Loss Event.
TRUST: ▇▇▇▇▇▇▇▇▇ Mortgage Securities Trust 2004-1, the Delaware
statutory trust created pursuant to this Agreement, and the assets of which
consist of the Mortgage Loans and the other assets described in Section 2.01(a).
TRUSTEE: Deutsche Bank National Trust Company, or its successor in
interest, or any successor trustee appointed as herein provided.
TRUSTEE FEE: As to any Distribution Date and each Mortgage Loan, an
amount equal to the product of one-twelfth of the Trustee Fee Rate and the
Scheduled Principal Balance of the Mortgage Loan as of the first day of the
related Due Period.
TRUSTEE FEE RATE: 0.00060% per annum.
UCC: The Uniform Commercial Code as in effect in the applicable
jurisdiction.
UNCERTIFICATED PRINCIPAL BALANCE: With respect to any REMIC I Regular
Interest, the balance thereof as indicated in Section 5.01, as reduced by
amounts allocated thereto in reduction thereof in accordance with Section 5.01.
UNINSURED CAUSE: Any cause of damage to a Mortgaged Property or
related REO Property such that the complete restoration of such Mortgaged
Property or related REO Property is not fully reimbursable by the hazard
insurance policies required to be maintained pursuant the related Servicing
Agreement, without regard to whether or not such policy is maintained.
UNITED STATES PERSON: A citizen or resident of the United States, a
corporation or partnership (including an entity treated as a corporation or
partnership for federal income tax purposes) created or organized in, or under
the laws of, the United States or any state thereof or the District of Columbia
(except, in the case of a partnership, to the extent provided in regulations),
provided that, for purposes solely of the Class R Certificates, no partnership
or other entity treated as a partnership for United States federal income tax
purposes shall be treated as a United States Person unless all persons that own
an interest in such partnership either directly or through any entity that is
not a corporation for United States federal income tax purposes are United
States Persons, or an estate whose income is subject to United States federal
income tax regardless of its source, or a trust if a court within the United
States is able to exercise primary supervision over the administration of the
trust and one or more such United States Persons have the authority to control
all substantial decisions of the trust. To the extent prescribed in regulations
by the Secretary of the Treasury, a trust which was in existence on August 20,
1996 (other than a trust treated as owned by the grantor under subpart E of part
I of subchapter J of chapter 1 of the Code), and which was treated as a United
States person on August 20, 1996 may elect to continue to be treated as a United
States person notwithstanding the previous sentence.
UNPAID APPLIED REALIZED LOSS AMOUNT: With respect to either Class of
the Subordinate Certificates and any Distribution Date, the excess of (i) the
Applied Realized Loss Amount with respect to such Class over (ii) the sum of all
distributions in reduction of the Applied Realized Loss Amounts and any
Subsequent Recoveries, in each case for such Class on all previous Distribution
Dates. Any amounts distributed to a Class of Subordinate Certificates in respect
of any Unpaid Applied Realized Loss Amount will not be applied to reduce the
Current Principal Amount of such Class and Subsequent Recoveries will be applied
to increase Current Principal Amounts of the Class I-M or Class II-M
Certificates, as applicable, as provided in Section 6.02.
ARTICLE IA
ORGANIZATION
Section 1A.01. NAME OF TRUST. The name of the Trust formed hereby
shall be "▇▇▇▇▇▇▇▇▇ Mortgage Securities Trust 2004-1," in which name the Trustee
may conduct the business and affairs of the Trust, make and execute contracts
and agreements on behalf of the Trust and ▇▇▇ and be sued.
Section 1A.02. OFFICE. The office of the Trust shall be in care of the
Delaware Trustee, and an additional office of the Trust shall be in care of the
Trustee. In the case of the Delaware Trustee the office of the Trust shall be
located at ▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇, ▇▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇ ▇▇▇▇▇ and in the
case of the Trustee, the office of the Trust shall be located at its Corporate
Trust Office, or at such other address as the Delaware Trustee or the Trustee
may designate by written notice to the Certificateholders, each Rating Agency
and the other parties to this Agreement.
Section 1A.03. DECLARATION OF TRUST. The Depositor hereby appoints
Deutsche Bank National Trust Company as Trustee of the Trust, to have all the
rights powers and duties set forth herein. The Depositor hereby appoints
Deutsche Bank Trust Company Delaware to act as Delaware Trustee hereunder. It is
the intention of the parties hereto that the Trust constitute a statutory trust
under Chapter 38 of Title 12 of the Delaware Code, 12 DEL. CODE ss. 3801 ET
SEQ., as the same may be amended from time to time (the "Delaware Statutory
Trust Statute"), and that this Agreement constitute the governing instrument of
such statutory trust. Effective as of the date hereof, the Trustee shall have
all rights, powers and duties set forth in the Delaware Statutory Trust Statute
with respect to accomplishing the purposes of the Trust. The Trustee and the
Delaware Trustee are hereby authorized to execute the Original Trust Agreement
and to file a Certificate of Trust in substantially the form of Exhibit J with
the Secretary of State of Delaware, on behalf of the Trust.
Section 1A.04. PURPOSE AND POWERS. The purposes of the Trust are (i)
to issue the Certificates and to sell the Certificates to or at the direction of
the Depositor; (ii) with the proceeds of the sale of the Certificates, to
purchase the Mortgage Loans and all related assets and to pay any organizational
start-up and transactional expenses of the Trust; (iii) to enter into this
Agreement and to perform its obligations hereunder; (iv) to engage in those
activities, including entering into agreements, that are necessary, suitable or
convenient to accomplish the foregoing or are incidental thereto or connected
therewith; and (v) subject to compliance with this Agreement, to engage in such
other activities as may be required in connection with the conservation of the
assets of the Trust and the making of distributions to the Certificateholders.
The Trust is hereby authorized to engage in the foregoing activities. The Trust
shall not engage in any activity other than in connection with the foregoing or
other than as required or authorized by the terms of this Agreement.
Section 1A.05. LIABILITY OF THE CERTIFICATEHOLDERS. The
Certificateholders shall be entitled to the same limitation of personal
liability extended to stockholders of private corporations for profit organized
under the General Corporation Law of the State of Delaware.
Section 1A.06. TITLE TO TRUST PROPERTY. Legal title to the assets of
the Trust shall be vested at all times in the Trust as a separate legal entity
except where applicable law in any jurisdiction requires title to any part of
the Trust to be vested in a trustee or trustees, in which case title shall be
deemed to be vested in the Trustee, the Delaware Trustee, a co-trustee and/or a
separate trustee, as the case may be, and in each case on behalf of the Trust.
The Certificateholders shall not have legal title to any part of the assets of
the Trust. No transfer by operation of law or otherwise of any interest of the
Certificateholders shall operate to terminate this Agreement or the trusts
hereunder or entitle any transferee to an accounting or to the transfer to it of
any part of the assets of the Trust. The Trustee, in such capacity and in its
capacity as Custodian, is hereby authorized to hold all assets of the Trust on
behalf of the Trust, for the benefit of the Certificateholders.
Section 1A.07. SITUS OF TRUST. The Trust will be located in the State
of Delaware and administered in the States of Delaware, California and Maryland.
Nothing herein shall restrict or prohibit the Trustee from having employees
within or without the State of Delaware. The Trust may also be qualified to do
business in the State of New York.
Section 1A.08. THE DELAWARE TRUSTEE. (a) The Delaware Trustee is
appointed to serve as the trustee of the Trust in the State of Delaware for the
sole purpose of satisfying the requirement of Section 3807(a) of the Delaware
Statutory Trust Act that the Trust have at least one trustee with a principal
place of business in the State of Delaware. It is understood and agreed by the
parties hereto that the Delaware Trustee shall have none of the duties or
liabilities of the Trustee.
(b) The duties of the Delaware Trustee shall be limited to (i)
accepting legal process served on the Trust in the State of Delaware and (ii)
the execution of any certificates required to be filed with the Delaware
Secretary of State which the Delaware Trustee is required to execute under
Section 3811 of the Delaware Statutory Trust Act. To the extent that, at law or
in equity, the Delaware Trustee has duties (including fiduciary duties) and
liabilities relating thereto to the Trust or the Certificateholders, it is
hereby understood and agreed by the other parties hereto that such duties and
liabilities are replaced by the duties and liabilities of the Delaware Trustee
expressly set forth in this Agreement. The Delaware trustee shall have no
liability for the acts or omissions of the Trustee.
(c) The Delaware Trustee may be removed by the Trustee upon thirty
days prior written notice to the Delaware Trustee. The Delaware Trustee may
resign upon thirty days prior written notice to the Trustee. No resignation or
removal of the Delaware Trustee shall be effective except upon the appointment
of a successor Delaware trustee. If no successor has been appointed within such
thirty day period, the Delaware Trustee or the Trustee may, at the expense of
the Trust, petition a court to appoint a successor Delaware trustee.
(d) Any Person into which the Delaware Trustee may be merged or with
which it may be consolidated, or any Person resulting from any merger or
consolidation to which the Delaware Trustee shall be a party, or any Person
which succeeds to all or substantially all of the corporate trust business of
the Delaware Trustee, shall be the successor Delaware Trustee under this
Agreement without the execution, delivery or filing of any paper or instrument
or further act to be done on the part of the parties hereto, except as may be
required by applicable law.
(e) The Delaware Trustee shall be entitled to all of the same rights,
protections indemnities and immunities under this Agreement and with respect to
the Trust as the Trustee. No amendment or waiver of any provision of this
Agreement which adversely affects the Delaware Trustee shall be effective
against it without its prior written consent.
(f) In the event of the appointment of a successor Delaware Trustee,
such successor shall cause an amendment to the certificate of trust to be filed
with the Secretary of State of Delaware in accordance with Section 3810 of the
Delaware Statutory Trust Act, indicating the change of such Delaware Trustee's
identity. In addition, until the termination of the Trust and this Agreement,
either the Trustee or Delaware Trustee shall at all times fulfill the
requirements of the Delaware Statutory Trust Act.
Section 1A.09 SEPARATENESS PROVISIONS. The Trust shall not commingle
its assets with those of any other entity. The Trust shall maintain its
financial and accounting books and records separate from those of any other
entity. Except as expressly set forth herein, the Trust shall pay its
indebtedness, operating expenses and liabilities from its own funds, and the
Trust shall neither incur any indebtedness nor pay the indebtedness, operating
expenses and liabilities of any other entity. Except as expressly set forth
herein, the Trust shall not engage in any dissolution, liquidation,
consolidation, merger or sale of assets. The Trust shall maintain appropriate
minutes or other records of all appropriate actions and shall maintain its
office separate from the offices of the Depositor or any of its Affiliates. The
Trust shall not engage in any business activity other than as contemplated by
this Agreement and related documentation. The Trust shall not form, or cause to
be formed, any subsidiaries and shall not own or acquire any asset other than as
contemplated by this Agreement and related documentation. Other than as
contemplated by this Agreement and related documentation, the Trust shall not
follow the directions or instructions of the Depositor. The Trust shall conduct
its own business in its own name. The Trust shall observe all formalities
required under the Delaware Statutory Trust Statute. The Trust shall not hold
out its credit as being available to satisfy the obligations of any other person
or entity. The Trust shall not acquire the obligations or securities of its
Affiliates or the Seller. Other than as contemplated by this Agreement and
related documentation, the Trust shall not pledge its assets for the benefit of
any other person or entity. The Trust shall correct any known misunderstanding
regarding its separate identity. The Trust shall not identify itself as a
division of any other person or entity.
For accounting purposes, the Trust shall be treated as an entity
separate and distinct from any Certificateholder. The pricing and other material
terms of all transactions and agreements to which the Trust is a party shall be
intrinsically fair to all parties thereto. This Agreement is and shall be the
only agreement among the parties hereto with respect to the creation, operation
and termination of the Trust.
ARTICLE II
Conveyance of Mortgage Loans;
Original Issuance of Certificates
Section 2.01 CONVEYANCE OF MORTGAGE LOANS AND OTHER ASSETS TO THE
TRUST. (a) The Depositor concurrently with the execution and delivery of this
Agreement, sells, transfers and assigns to the Trust without recourse all its
right, title and interest in and to (i) the Mortgage Loans identified in the
Mortgage Loan Schedule, including all interest and principal due with respect to
the Mortgage Loans after the Cut-off Date, but excluding any payments of
principal and interest due on or prior to the Cut-off Date (and excluding any
Retained Interest on a Mortgage Loan); (ii) such assets relating to the Mortgage
Loans as from time to time may be held by the Servicers in each Servicer
Account, the Master Servicer in the Master Servicer Collection Account and the
Trustee in the Distribution Account (but, in each case, excluding all investment
earnings thereon), for the benefit of the Trust, (iii) any REO Property, (iv)
the Required Insurance Policies and any amounts paid or payable by the insurer
under any Insurance Policy (to the extent the mortgagee has a claim thereto),
(v) the rights of the Depositor in, but none of the obligations of the Depositor
with respect to, the Mortgage Loan Purchase Agreement, including but not limited
to Depositor's rights and obligations pursuant to each of the Servicing
Agreements (noting that the Seller has also retained the right in the event of
breach of the representations, warranties and covenants, if any, with respect to
the related Mortgage Loans of the related Servicer under the related Servicing
Agreement to enforce the provisions thereof and to seek all or any available
remedies), (vi) its rights with respect to each of the Servicing Agreements,
(vii) with respect to Additional Collateral Mortgage Loans (a) its rights as
assignee under any security agreements, pledge agreements or guarantees relating
to the Additional Collateral supporting any Additional Collateral Mortgage Loan,
(b) its security interest in and to any Additional Collateral, and (c) its right
to receive payments in respect of any Additional Collateral Mortgage Loan
pursuant to the related Servicing Agreement, in each case, as previously
conveyed to the Seller, and the Depositor, (viii) if any of the Mortgage Loans
identified on the Mortgage Loan Schedule are MLCC Mortgage Loans, its related
rights under the MLCC Limited Purpose Surety Bond and (ix) any proceeds of the
foregoing. The Seller hereby consents to such transfer of the Depositor's right,
title and interest as set forth above.
The foregoing sale, transfer, assignment, set-over, deposit and
conveyance does not and is not intended to result in creation or assumption by
the Trustee of any obligation of the Seller or the Depositor or any other Person
in connection with the Mortgage Loans or any other agreement or instrument
relating thereto. The obligations of the Seller to substitute or repurchase, as
applicable, a Mortgage Loan shall be the Trustee's, the Trust's and the
Certificateholders' sole remedy for any breach thereof. At the request of the
Trustee, the Depositor shall take such actions as may be necessary to enforce
the above right, title and interest on behalf of the Trustee and the Trust or
shall execute such further documents as the Trustee may reasonably require in
order to enable the Trustee to carry out such enforcement. The Seller hereby
consents to such transfer of the Depositor's right, title and interest as set
forth above.
In addition to the foregoing, the Depositor shall deliver to the
Trustee on the Closing Date, for deposit into the Distribution Account, the sum
of $100.00, to be distributed in accordance with Section 6.01(a) hereof.
For purposes of complying with the requirements of the Asset-Backed
Securities Facilitation Act of the State of Delaware, 6 Del. C. ss. 2701A, et
seq. (the "Securitization Act"), each of the parties hereto hereby agrees that:
(i) any property, assets or rights purported to be transferred,
in whole or in part, by the Depositor pursuant to this Agreement shall
be deemed to no longer be the property, assets or rights of the
Depositor;
(ii) none of the Depositor, its creditors or, in any insolvency
proceeding with respect to the Depositor or the Depositor's property,
a bankruptcy trustee, receiver, debtor, debtor in possession or
similar person, to the extent the issue is governed by Delaware law,
shall have any rights, legal or equitable, whatsoever to reacquire
(except pursuant to a provision of this Agreement), reclaim, recover,
repudiate, disaffirm, redeem or recharacterize as property of the
Depositor any property, assets or rights purported to be transferred,
in whole or in part, by the Depositor pursuant to this Agreement
(including the Assignment);
(iii) in the event of a bankruptcy, receivership or other
insolvency proceeding with respect to the Depositor or the Depositor's
property, to the extent the issue is governed by Delaware law, such
property, assets and rights shall not be deemed to be part of the
Depositor's property, assets, rights or estate; and
(iv) the transaction contemplated by this Agreement shall
constitute a "securitization transaction" as such term is used in the
Securitization Act.
Although it is the intent of the parties to this Agreement that the
conveyance of the Depositor's right, title and interest in and to the Mortgage
Loans and other assets in the Trust pursuant to this Agreement shall constitute
a purchase and sale and not a loan, in the event that such conveyance is deemed
to be a loan, it is the intent of the parties to this Agreement that the
Depositor shall be deemed to have granted to the Trustee a first priority
perfected security interest in all of the Depositor's right, title and interest
in, to and under the Mortgage Loans and other assets in the Trust, and that this
Agreement shall constitute a security agreement under applicable law.
(b) In connection with such transfer and assignment, the Seller, on
behalf of the Depositor does hereby deliver to, and deposit with, or cause to be
delivered to and deposited with, the Trustee, and/or any Custodian acting on the
Trustee's behalf, if applicable, the following documents or instruments with
respect to each Mortgage Loan (each a "Mortgage File") so transferred and
assigned:
(i) with respect to each Mortgage Loan, the original Mortgage
Note endorsed without recourse, in blank or in substantially the
following form: pay to the order of Deutsche Bank National Trust
Company, as Trustee for ▇▇▇▇▇▇▇▇▇ Mortgage Securities Trust 2004-1,
without recourse (in each case, with all necessary intervening
endorsements as applicable);
(ii) the original of any guarantee, security agreement or pledge
agreement relating to any Additional Collateral, if applicable, and
executed in connection with the Mortgage Note, assigned to the Trustee
on behalf of the Trust;
(iii) with respect to each Mortgage Loan (other than a
Cooperative Loan), the original recorded Security Instrument with
evidence of recording indicated thereon and the original recorded
power of attorney, if the Security Instrument was executed pursuant to
a power of attorney, with evidence of recording thereon or, if such
Security Instrument or power of attorney has been submitted for
recording but has not been returned from the applicable public
recording office, has been lost or is not otherwise available, a copy
of such Security Instrument or power of attorney, as the case may be,
certified to be a true and complete copy of the original submitted for
recording. If, in connection with any Mortgage Loan, the Seller cannot
deliver the Security Instrument with evidence of recording thereon on
or prior to the Closing Date because of a delay caused by the public
recording office where such Security Instrument has been delivered for
recordation or because such Security Instrument has been lost, the
Seller shall deliver or cause to be delivered to the Trustee (or its
Custodian) on behalf of the Trust, in the case of a delay due to
recording, a true copy of such Security Instrument, pending delivery
of the original thereof, together with an Officer's Certificate of the
Seller certifying that the copy of such Security Instrument delivered
to the Trustee (or its Custodian) is a true copy and that the original
of such Security Instrument has been forwarded to the public recording
office, or, in the case of a Security Instrument that has been lost, a
copy thereof (certified as provided for under the laws of the
appropriate jurisdiction) and a written Opinion of Counsel acceptable
to the Trustee and the Depositor that an original recorded Security
Instrument is not required to enforce the Trustee's interest in the
Mortgage Loan;
(iv) the original of each assumption, modification or
substitution agreement, if any, relating to the Mortgage Loans, or, as
to any assumption, modification or substitution agreement which cannot
be delivered on or prior to the Closing Date because of a delay caused
by the public recording office where such assumption, modification or
substitution agreement has been delivered for recordation, a photocopy
of such assumption, modification or substitution agreement, pending
delivery of the original thereof, together with an Officer's
Certificate of the Seller certifying that the copy of such assumption,
modification or substitution agreement delivered to the Trustee (or
its custodian) on behalf of the Trust is a true copy and that the
original of such agreement has been forwarded to the public recording
office;
(v) with respect to each Non-MERS Mortgage Loan (other than a
Cooperative Loan), the original assignment of mortgage for each
Mortgage Loan;
(vi) if applicable, such original intervening assignments of the
Security Instrument, notice of transfer or equivalent instrument
(each, an "Intervening Assignment"), as may be necessary to show a
complete chain of assignment from the originator, or, in the case of
an Intervening Assignment that has been lost, a written Opinion of
Counsel acceptable to the Trustee that such original Intervening
Assignment is not required to enforce the Trustee's interest in the
Mortgage Loans;
(vii) the original Primary Mortgage Insurance Policy, if any, or
certificate, if private mortgage guaranty insurance is required;
(viii) with respect to each Mortgage Loan (other than a
Cooperative Loan), the original mortgagee title insurance policy or
attorney's opinion of title and abstract of title;
(ix) the original of any security agreement, chattel mortgage or
equivalent executed in connection with the Security Instrument or as
to any security agreement, chattel mortgage or their equivalent that
cannot be delivered on or prior to the Closing Date because of a delay
caused by the public recording office where such document has been
delivered for recordation, a photocopy of such document, pending
delivery of the original thereof, together with an Officer's
Certificate of the Seller certifying that the copy of such security
agreement, chattel mortgage or their equivalent delivered to the
Trustee (or its custodian) on behalf of the Trust is a true copy and
that the original of such document has been forwarded to the public
recording office; and
(x) with respect to any Cooperative Loan, the Cooperative Loan
Documents.
(c) (i) Assignments of each Security Instrument with respect to each
Non-MERS Mortgage Loan (other than a Cooperative Loan) shall be recorded;
provided, however, that such assignments need not be recorded if, in the Opinion
of Counsel (which must be from Independent counsel and not at the expense of the
Trust or the Trustee) acceptable to the Trustee, each Rating Agency and the
Master Servicer, recording in such states is not required to protect the Trust's
interest in the related Non-MERS Mortgage Loans; PROVIDED, HOWEVER,
notwithstanding the delivery of any Opinion of Counsel, each assignment of
Security Instrument shall be submitted for recording by the Seller (or the
Seller will cause the applicable Servicer to submit each such assignment for
recording), at the cost and expense of the Seller, in the manner described
above, at no expense to the Trust or Trustee, upon the earliest to occur of (1)
reasonable direction by the Holders of Certificates evidencing Fractional
Undivided Interests aggregating not less than 51% of the Trust, (2) the
occurrence of a bankruptcy or insolvency relating to the Seller or the
Depositor, or (3) with respect to any one assignment of Security Instrument, the
occurrence of a bankruptcy, insolvency or foreclosure relating to the Mortgagor
under the related Mortgage. Subject to the preceding sentence, as soon as
practicable after the Closing Date (but in no event more than 3 months
thereafter except to the extent delays are caused by the applicable recording
office), the Seller shall properly record (or the Seller will cause the
applicable Servicer to properly record), at the expense of the Seller (with the
cooperation of the Depositor, the Trustee and the Master Servicer), in each
public recording office where the related Mortgages are recorded, each
assignment referred to in subsection (b)(v) above with respect to a Non-MERS
Mortgage Loan.
(ii) With respect to each Cooperative Loan, the Seller will take
(or shall cause the applicable Servicer to take), at the expense of
the Seller (with the cooperation of the Depositor, the Trustee and the
Master Servicer), such actions as are necessary under applicable law
in order to perfect the interest of the Trust in the related Mortgaged
Property.
(iii) With respect to each MERS Mortgage Loan, the Seller will
take (or shall cause the applicable Servicer to take), at the expense
of the Seller (with the cooperation of the Depositor, the Trustee and
the Master Servicer), such actions as are necessary to cause the Trust
to be clearly identified as the owner of each such Mortgage Loan on
the records of MERS for purposes of the system of recording transfers
of beneficial ownership of mortgages maintained by MERS.
(d) In addition, in instances where a title insurance policy is
required to be delivered to the Trustee, or to the Custodian on behalf of the
Trustee, under clause (b)(viii) above and is not so delivered, the Seller will
provide a copy of such title insurance policy to the Trustee, or to the
Custodian on behalf of the Trustee, as promptly as practicable after the
execution and delivery hereof, but in any case within 180 days of the Closing
Date.
(e) For Mortgage Loans (if any) that have been prepaid in full after
the Cut-off Date and prior to the Closing Date, the Seller, in lieu of
delivering the above documents, herewith delivers to the Trustee, or to the
Custodian on behalf of the Trustee, an Officer's Certificate which shall include
a statement to the effect that all amounts received in connection with such
prepayment that are required to be deposited in the Distribution Account are to
be remitted by the related Servicers in accordance with their respective
Servicing Agreements. All original documents that are not delivered to the
Trustee or the Custodian on behalf of the Trustee shall be held by the Master
Servicer or the applicable Servicer in trust for the Trustee, for the benefit of
the Trust and the Certificateholders.
(f) Notwithstanding the foregoing, with respect to up to 1% of the
Scheduled Principal Balance of the Mortgage Loans as of the Cut-Off Date, in
lieu of a Mortgage File containing an original, endorsed Mortgage Note, the
Seller may deliver a Lost Note Affidavit with respect thereto.
Section 2.02 ACCEPTANCE OF MORTGAGE LOANS AND OTHER TRUST ASSETS BY
TRUSTEE. (a) The Trustee acknowledges the sale, transfer and assignment of the
Mortgage Loans and other assets as provided in Section 2.01(a) to the Trust by
the Depositor and receipt of, subject to further review and the exceptions which
may be noted pursuant to the procedures described below, and declares that it
holds, the documents (or certified copies thereof) delivered to it pursuant to
Section 2.01(b), and declares that it will continue to hold those documents and
any amendments, replacements or supplements thereto and all other assets of the
Trust delivered to it as Trustee in trust for the Trust (for the benefit of all
present and future Holders of the Certificates). On the Closing Date, the
Trustee (or Custodian on its behalf), with respect to the Mortgage Loans, shall
acknowledge with respect to each Mortgage Loan by an Initial Certification
substantially in the form of Exhibit C-1 hereto (i) receipt of a Mortgage File
containing an original Mortgage Note, but without review of any such Mortgage
File, except to the extent necessary to confirm that such Mortgage File contains
the related Mortgage Note or (ii) that a Lost Note Affidavit has been delivered
with respect thereto. No later than 90 days after the Closing Date (or, with
respect to any Substitute Mortgage Loan, within five Business Days after the
receipt by the Trustee or Custodian thereof), the Trustee agrees, for the
benefit of the Certificateholders, to review, or cause to be reviewed by a
Custodian on its behalf (under a Custodial Agreement), each Mortgage File
delivered to it and to execute and deliver, or cause to be executed and
delivered, to the Seller, the Depositor and the Master Servicer, an Interim
Certification substantially in the form annexed as Exhibit C-2 hereto. In
conducting such review, the Trustee (or Custodian) will ascertain whether all
required documents have been executed and received, and based on the Mortgage
Loan Schedule, whether those documents relate, determined on the basis of the
Mortgagor name, original principal balance and loan number, to the Mortgage
Loans it has received, as identified in the Mortgage Loan Schedule. In
performing any such review, the Trustee (or the Custodian, as its agent) may
conclusively rely on the purported due execution and genuineness of any such
document and on the purported genuineness of any signature thereon. If the
Trustee (or the Custodian, as its agent) finds any document constituting part of
the Mortgage File not to have been executed or received, or to be unrelated to
the Mortgage Loans identified in Exhibit B or to appear to be defective on its
face, the Trustee or the Custodian, as its agent, shall promptly notify the
Seller (provided, however, that with respect to those documents described in
subsection (b)(iv), (b)(vi), (b)(vii) and (b)(ix) of Section 2.01, the Trustee's
obligations shall extend only to the documents actually delivered pursuant to
such subsections). In accordance with the Mortgage Loan Purchase Agreement, the
Seller shall correct or cure any such defect within ninety (90) days from the
date of notice from the Trustee (or the Custodian, as its agent) of the defect
and if the Seller fails to correct or cure the defect within such period, and
such defect materially and adversely affects the interests of the Trust or the
Certificateholders in the related Mortgage Loan, the Trustee or the Custodian,
as its agent, shall enforce the Seller's obligation pursuant to the Mortgage
Loan Purchase Agreement, within 90 days from the Trustee's or the Custodian's
notification, to purchase such Mortgage Loan at the Repurchase Price; provided
that, if such defect would cause the Mortgage Loan to be other than a "qualified
mortgage" as defined in Section 860G(a)(3) of the Code, any such cure or
repurchase must occur within 90 days from the date such breach was discovered.
The foregoing repurchase obligation shall not apply in the event that the Seller
cannot deliver such original or copy of any document submitted for recording to
the appropriate recording office in the applicable jurisdiction because such
document has not been returned by such office; provided that the Seller shall
instead deliver a recording receipt of such recording office or, if such receipt
is not available, an Officer's Certificate confirming that such documents have
been accepted for recording, and delivery to the Trustee (or the Custodian, as
its agent) shall be effected by the Seller within thirty days of its receipt of
the original recorded document.
(b) No later than 180 days after the Closing Date, the Trustee (or the
Custodian, as its agent) will determine whether all documents in the Mortgage
Files required to be delivered to it were delivered to it and will execute and
deliver or cause to be executed and delivered to the Seller, the Depositor and
the Master Servicer a Final Certification substantially in the form annexed as
Exhibit C-3 hereto. In making such determination, the Trustee (or the Custodian,
as its agent) will ascertain whether an original of each document required to be
recorded has been returned from the recording office with evidence of recording
thereon or a certified copy has been obtained from the recording office. If the
Trustee (or the Custodian, as its agent) finds any document constituting part of
the Mortgage File has not been received, or to be unrelated, determined on the
basis of the Mortgagor name, original principal balance and loan number, to the
Mortgage Loans identified in Exhibit B or to appear defective on its face, the
Trustee (or the Custodian, as its agent) shall promptly notify the Seller
(provided, however, that with respect to those documents described in subsection
(b)(iv), (b)(vi), (b)(vii) and (b)(ix) of Section 2.01, the Trustee's
obligations shall extend only to the documents actually delivered pursuant to
such subsections). In accordance with the Mortgage Loan Purchase Agreement, the
Seller shall correct or cure any such defect or the Seller shall deliver to the
Trustee an Opinion of Counsel to the effect that such defect does not materially
or adversely affect the interests of the Trust or the Certificateholders in such
Mortgage Loan within 90 days from the date of notice from the Trustee of the
defect and if the Seller is unable to cure such defect within such period, and
if such defect materially and adversely affects the interests of the Trust or
the Certificateholders in the related Mortgage Loan, the Trustee shall enforce
the Seller's obligation under the Mortgage Loan Purchase Agreement to purchase
such Mortgage Loan at the Repurchase Price. The foregoing repurchase obligation
shall not apply in the event that the Seller cannot deliver such original or
copy of any document submitted for recording to the appropriate recording office
in the applicable jurisdiction because such document has not been returned by
such office; provided that the Seller shall instead deliver a recording receipt
of such recording office or, if such receipt is not available, an Officer's
Certificate confirming that such documents have been accepted for recording, and
delivery to the Trustee (or the Custodian, as its agent) shall be effected by
the Seller within thirty days of its receipt of the original recorded document.
(c) In the event that a Mortgage Loan is purchased by the Seller in
accordance with Subsections 2.02(a) or (b) above or 2.03 below as a consequence
of a breach of representation or warranty under Section 2.07 below, the Seller
shall remit to the Trustee the Repurchase Price for deposit in the Distribution
Account and the Seller shall provide to the Trustee written details concerning
the components of the Repurchase Price. Upon deposit of the Repurchase Price in
the Distribution Account, the Trustee shall notify the Depositor and the Master
Servicer, and the Trustee (or the Custodian, as its agent) (upon receipt of a
Request for Release to be executed by the Seller in the form of Exhibit D
attached hereto with respect to such Mortgage Loan), shall release to the Seller
the related Mortgage File and the Trustee shall execute and deliver all
instruments of transfer or assignment, without recourse, furnished to it by the
Seller as are necessary to vest in the Seller title to and rights under the
Mortgage Loan. Such purchase shall be deemed to have occurred on the date on
which the Repurchase Price in available funds is received by the Trustee. The
Trustee shall amend the Mortgage Loan Schedule, which was previously delivered
to it by the Depositor in a form agreed to between the Depositor and the
Trustee, to reflect such repurchase and shall promptly notify each Rating Agency
and the Master Servicer of such amendment. The obligation of the Seller to
repurchase any Mortgage Loan as to which such a defect in a constituent document
exists shall be the sole remedy respecting such defect available to the Trust,
the Certificateholders, or to the Trustee on their behalf.
Section 2.03 MORTGAGE LOAN PURCHASE AGREEMENT. If the Depositor, the
Master Servicer, the Seller, the Securities Administrator or the Trustee
discovers a breach of any of the representations and warranties set forth in the
Mortgage Loan Purchase Agreement as incorporated by reference herein pursuant to
Section 2.07, which breach materially and adversely affects the value of the
interests of the Trust, the Certificateholders or the Trustee in the related
Mortgage Loan, the party discovering the breach shall give prompt written notice
of the breach to the other parties. The Seller, within 90 days of its discovery
or receipt of notice that such breach has occurred (whichever occurs earlier),
shall cure the breach in all material respects or, subject to the Mortgage Loan
Purchase Agreement or Section 2.04 of this Agreement, as applicable, shall
purchase the Mortgage Loan or any property acquired with respect thereto from
the Trust; provided, however, that if there is a breach of any representation
set forth in the Mortgage Loan Purchase Agreement or Section 2.04 of this
Agreement, as applicable, and the Mortgage Loan or the related property acquired
with respect thereto has been sold, then the Seller shall pay, in lieu of the
Repurchase Price, any excess of the Repurchase Price over the Net Liquidation
Proceeds received upon such sale. (If the Net Liquidation Proceeds exceed the
Repurchase Price, any excess shall be paid to the Seller to the extent not
required by law to be paid to the borrower.) Any such purchase by the Seller
shall be made by providing an amount equal to the Repurchase Price to the
Trustee for deposit in the Distribution Account and written notification
containing details of the components of such Repurchase Price. Upon receipt of
notice from the Trustee of the deposit of the Repurchase Price in the
Distribution Account, the Seller shall execute and deliver a Request for Release
in the form of Exhibit D attached hereto with respect to such Mortgage Loan, and
the Trustee shall release, or the Trustee shall cause the Custodian to release,
to the Seller the related Mortgage File and the Trustee shall execute and
deliver all instruments of transfer or assignment furnished to it by the Seller,
without recourse, as are necessary to vest in the Seller title to and rights
under the Mortgage Loan or any property acquired with respect thereto. Such
purchase shall be deemed to have occurred on the date on which the Repurchase
Price in available funds is received by the Trustee. The Trustee shall amend the
Mortgage Loan Schedule to reflect such repurchase and shall promptly notify the
Master Servicer and each Rating Agency of such amendment. Enforcement of the
obligation of the Seller to purchase (or substitute a Substitute Mortgage Loan
for) any Mortgage Loan or any property acquired with respect thereto (or pay the
Repurchase Price as set forth in the above proviso) as to which a breach has
occurred and is continuing shall constitute the sole remedy respecting such
breach available to the Trust, the Certificateholders or the Trustee on their
behalf.
Section 2.04 SUBSTITUTION OF MORTGAGE LOANS. Notwithstanding anything
to the contrary in this Agreement, in lieu of purchasing a Mortgage Loan
pursuant to the Mortgage Loan Purchase Agreement or Sections 2.02 or 2.03 of
this Agreement, the Seller may, no later than the date by which such purchase by
the Seller would otherwise be required, tender to the Trustee, on behalf of the
Trust, a Substitute Mortgage Loan accompanied by a certificate of an authorized
officer of the Seller that such Substitute Mortgage Loan conforms to the
requirements set forth in the definition of "Substitute Mortgage Loan" in the
Mortgage Loan Purchase Agreement and this Agreement; provided, however, that
substitution pursuant to the Mortgage Loan Purchase Agreement or Section 2.04 of
this Agreement, as applicable, in lieu of purchase shall not be permitted after
the termination of the two-year period beginning on the Startup Day; provided,
further, that if the breach would cause the Mortgage Loan to be other than a
"qualified mortgage" as defined in Section 860G(a)(3) of the Code, any such cure
or substitution must occur within 90 days from the date the breach was
discovered. The Trustee or the Custodian, as its agent, shall examine the
Mortgage File for any Substitute Mortgage Loan in the manner set forth in
Section 2.02(a) and the Trustee or the Custodian, as its agent, shall notify the
Seller, in writing, within five Business Days after receipt, whether or not the
documents relating to the Substitute Mortgage Loan satisfy the requirements of
the fourth sentence of Subsection 2.02(a). Within two Business Days after such
notification, the Seller shall provide to the Trustee for deposit in the
Distribution Account the amount, if any, by which the Outstanding Principal
Balance as of the next preceding Due Date of the Mortgage Loan for which
substitution is being made, after giving effect to Scheduled Principal due on
such date, exceeds the Outstanding Principal Balance as of such date of the
Substitute Mortgage Loan, after giving effect to Scheduled Principal due on such
date (a "Substitution Adjustment Amount"), which amount shall be treated for the
purposes of this Agreement as if it were the payment by the Seller of the
Repurchase Price for the purchase of a Mortgage Loan by the Seller. After such
notification to the Seller and, if any such excess exists, upon receipt of such
deposit, the Trustee, on behalf of the Trust, shall accept such Substitute
Mortgage Loan which shall thereafter be deemed to be a Mortgage Loan hereunder.
In the event of such a substitution, accrued interest on the Substitute Mortgage
Loan for the month in which the substitution occurs and any Principal
Prepayments made thereon during such month shall be the property of the Trust,
and accrued interest for such month on the Mortgage Loan being repurchased by
the Seller and any Principal Prepayments made thereon during such month shall be
the property of the Seller. The Scheduled Principal on a Substitute Mortgage
Loan due on the Due Date in the month of substitution shall be the property of
the Seller and the Scheduled Principal on the Mortgage Loan for which the
substitution is made due on such Due Date shall be the property of the Trust.
Upon acceptance of the Substitute Mortgage Loan (and delivery to the Trustee (or
Custodian) of a Request for Release for such Mortgage Loan), the Trustee shall
release to the Seller the related Mortgage File related to any Mortgage Loan
released pursuant to the Mortgage Loan Purchase Agreement or Section 2.04 of
this Agreement, as applicable, and shall execute and deliver all instruments of
transfer or assignment, without recourse, in form as provided to it as are
necessary to vest in the Seller title to and rights under any Mortgage Loan
released pursuant to the Mortgage Loan Purchase Agreement or Section 2.04 of
this Agreement, as applicable. The Seller shall deliver the documents related to
the Substitute Mortgage Loan in accordance with the provisions of the Mortgage
Loan Purchase Agreement or Subsections 2.01(b) and 2.02(b) of this Agreement, as
applicable, with the date of acceptance of the Substitute Mortgage Loan deemed
to be the Closing Date for purposes of the time periods set forth in those
Subsections. The representations and warranties set forth in the Mortgage Loan
Purchase Agreement shall be deemed to have been made by the Seller with respect
to each Substitute Mortgage Loan as of the date of acceptance of such Mortgage
Loan by the Trustee on behalf of the Trust. The Master Servicer shall amend the
Mortgage Loan Schedule to reflect such substitution and shall provide a copy of
such amended Mortgage Loan Schedule to the Trustee and each Rating Agency.
Section 2.05 ISSUANCE OF CERTIFICATES. The Trustee on behalf of the
Trust acknowledges the assignment to it of the Mortgage Loans and the other
assets comprising the Trust and, concurrently therewith, has signed, and
authenticated and delivered to the Depositor, in exchange therefor, Certificates
in such authorized denominations representing such Fractional Undivided
Interests as the Depositor has requested. The Trustee agrees that it will hold
the Mortgage Loans and such other assets as may from time to time be delivered
to it segregated on the books of the Trustee in trust for the benefit of the
Trust and the Certificateholders.
The Depositor, concurrently with the execution and delivery hereof,
does hereby transfer, assign, set over and otherwise convey in trust to the
Trustee without recourse all the right, title and interest of the Depositor in
and to the REMIC I Regular Interests and the other assets of REMIC II for the
benefit of the holders of the REMIC II Interests. The Trustee acknowledges
receipt of the REMIC I Regular Interests (which are uncertificated) and the
other assets of REMIC II and declares that it holds and will hold the same in
trust for the exclusive use and benefit of the holders of the REMIC II
Certificates.
Section 2.06 REPRESENTATIONS AND WARRANTIES CONCERNING THE DEPOSITOR.
The Depositor hereby represents and warrants to the Trustee, the Master Servicer
and the Securities Administrator as follows:
(i) the Depositor (a) is a corporation duly organized, validly
existing and in good standing under the laws of the State of Delaware
and (b) is qualified and in good standing as a foreign corporation to
do business in each jurisdiction where such qualification is
necessary, except where the failure so to qualify would not reasonably
be expected to have a material adverse effect on the Depositor's
business as presently conducted or on the Purchaser's ability to enter
into this Agreement and to consummate the transactions contemplated
hereby;
(ii) the Depositor has full corporate power to own its property,
to carry on its business as presently conducted and to enter into and
perform its obligations under this Agreement;
(iii) the execution and delivery by the Depositor of this
Agreement have been duly authorized by all necessary corporate action
on the part of the Depositor; and neither the execution and delivery
of this Agreement, nor the consummation of the transactions herein
contemplated, nor compliance with the provisions hereof, will conflict
with or result in a breach of, or constitute a default under, any of
the provisions of any law, governmental rule, regulation, judgment,
decree or order binding on the Depositor or its properties or the
articles of incorporation or by-laws of the Depositor, except those
conflicts, breaches or defaults which would not reasonably be expected
to have a material adverse effect on the Depositor's ability to enter
into this Agreement and to consummate the transactions contemplated
hereby;
(iv) the execution, delivery and performance by the Depositor of
this Agreement and the consummation of the transactions contemplated
hereby do not require the consent or approval of, the giving of notice
to, the registration with, or the taking of any other action in
respect of, any state, federal or other governmental authority or
agency, except those consents, approvals, notices, registrations or
other actions as have already been obtained, given or made;
(v) this Agreement has been duly executed and delivered by the
Depositor and, assuming due authorization, execution and delivery by
the other parties hereto, constitutes a valid and binding obligation
of the Depositor enforceable against it in accordance with its terms
(subject to applicable bankruptcy and insolvency laws and other
similar laws affecting the enforcement of the rights of creditors
generally);
(vi) there are no actions, suits or proceedings pending or, to
the knowledge of the Depositor, threatened against the Depositor,
before or by any court, administrative agency, arbitrator or
governmental body (i) with respect to any of the transactions
contemplated by this Agreement or (ii) with respect to any other
matter which in the judgment of the Depositor will be determined
adversely to the Depositor and will if determined adversely to the
Depositor materially and adversely affect the Depositor's ability to
enter into this Agreement or perform its obligations under this
Agreement; and the Depositor is not in default with respect to any
order of any court, administrative agency, arbitrator or governmental
body so as to materially and adversely affect the transactions
contemplated by this Agreement; and
(vii) immediately prior to the transfer and assignment to the
Trustee on behalf of the Trust, each Mortgage Note and each Mortgage
were not subject to an assignment or pledge, and the Depositor had
good and marketable title to and was the sole owner thereof and had
full right to transfer and sell such Mortgage Loan to the Trustee on
behalf of the Trust free and clear of any encumbrance, equity, lien,
pledge, charge, claim or security interest.
Section 2.07 REPRESENTATIONS AND WARRANTIES CONCERNING THE MORTGAGE
LOANS. (a) The representations and warranties of the Seller with respect to the
Mortgage Loans contained in Section 7 of the Mortgage Loan Purchase Agreement
(including Exhibit 4 thereto) are incorporated by reference herein and are
hereby restated in their entirety, as of the Closing Date, by the Seller for the
benefit of the Trust and the Certificateholders.
(b) The Depositor hereby represents and warrants to the Trustee and
the Trust, as of the Closing Date, with respect to each Mortgage Loan being sold
by it that (i) it had good and transferable title to each such Mortgage Loan at
the time of its sale to the Trust, and (ii) each Mortgage Loan constitutes a
"qualified mortgage" under Section 860G(a)(3)(A) of the Code and Treasury
Regulation Section 1.860G-2(a)(1).
(c) In the event of a breach of a representation or warranty regarding
a Mortgage Loan by the Seller, the Seller, shall repurchase or substitute for
such Mortgage Loan in accordance with the provisions of Section 2.03 or 2.04
hereof, and in the event of a breach of a representation or warranty regarding a
Mortgage Loan by the Depositor, the Depositor, shall repurchase or substitute
for such Mortgage Loan in accordance with the provisions of Section 2.03 or 2.04
hereof as if the Depositor were the Seller. None of the Trustee, the Trust or
the Certificateholders shall have any remedy other than the requirement that a
Mortgage Loan be repurchased or substituted for by either the Seller or the
Depositor, as applicable, with respect to any breaches of representations or
warranties with respect to such Mortgage Loan.
(d) Notwithstanding that any representation or warranty made by the
Seller in Section 7 of the Mortgage Loan Purchase Agreement (including Exhibit 4
thereto) is made only to the best of the Seller's knowledge, the Seller shall be
obligated under this Section 2.07 to repurchase or substitute for any Mortgage
Loan with respect to which such representation or warranty was untrue as of the
Cut-off Date, the Closing Date, or otherwise, as applicable, irrespective of the
Seller's lack of knowledge thereof.
Section 2.08 APPOINTMENT OF CUSTODIAN. The Trustee is hereby appointed
Custodian of the Mortgage Loans and the related Mortgage Files. The Trustee
shall be compensated for its services as Custodian by ▇▇▇▇▇▇▇▇▇, pursuant to a
separate agreement between ▇▇▇▇▇▇▇▇▇ and Deutsche Bank National Trust Company.
In the event that the Trustee is owed any sums not paid by ▇▇▇▇▇▇▇▇▇, the
Trustee shall be entitled to reimbursement for such amounts as an expense of the
Trust pursuant to Section 9.05 hereof. The Trustee, with the consent of
▇▇▇▇▇▇▇▇▇, may enter into an agreement with a third-party to assume the role of
custodian hereunder, provided that (i) such Agreement shall be substantially in
the form of Exhibit G hereto, (ii) such custodian shall be acceptable to each
Rating Agency and the Depositor, and (iii) the Trustee, unless such successor
Custodian is appointed at the request of ▇▇▇▇▇▇▇▇▇, then ▇▇▇▇▇▇▇▇▇, shall be
responsible for all costs and expenses relating to the transference of the
Mortgage Files to such successor custodian.
ARTICLE III
Administration and Servicing of Mortgage Loans
Section 3.01 MASTER SERVICER. The Master Servicer shall supervise,
monitor and oversee the obligation of the Servicers to service and administer
their respective Mortgage Loans in accordance with the terms of the applicable
Servicing Agreement and, where applicable, the Correspondent Sellers Guide and
the Master Servicing Guide, and shall have full power and authority to do any
and all things which it may deem necessary or desirable in connection with such
master servicing and administration. In performing its obligations hereunder,
the Master Servicer shall act in a manner consistent with Accepted Master
Servicing Practices and, where applicable, the Master Servicing Guide.
Furthermore, the Master Servicer shall oversee and consult with each Servicer as
necessary from time-to-time to carry out the Master Servicer's obligations
hereunder, shall receive, review and evaluate all reports, information and other
data provided to the Master Servicer by each Servicer and shall cause each
Servicer to perform and observe the covenants, obligations and conditions to be
performed or observed by such Servicer under the applicable Servicing Agreement.
The Master Servicer shall independently and separately monitor each Servicer's
servicing activities with respect to each related Mortgage Loan, reconcile the
results of such monitoring with such information provided in the previous
sentence on a monthly basis and coordinate corrective adjustments to the
Servicers' and Master Servicer's records, and based on such reconciled and
corrected information, prepare the statements specified in Section 6.04 and any
other information and statements required hereunder. The Master Servicer shall
reconcile the results of its Mortgage Loan monitoring with the actual
remittances of the Servicers to the related Servicer Accounts pursuant to the
applicable Servicing Agreements.
The Trustee shall furnish the Servicers and the Master Servicer with
any limited powers of attorney and other documents in form as provided to it
necessary or appropriate to enable the Servicers and the Master Servicer to
service and administer the related Mortgage Loans and REO Property, which
limited powers of attorney shall provide that the Trustee will not be liable for
the actions or omissions of the Servicers or Master Servicer in exercising such
powers.
The Trustee shall provide access to the records and documentation in
possession of the Trustee (including in its capacity as Custodian hereunder)
regarding the related Mortgage Loans and REO Property and the servicing thereof
to the Certificateholders, the FDIC, and the supervisory agents and examiners of
the FDIC, such access being afforded only upon reasonable prior written request
and during normal business hours at the office of the Trustee; provided,
however, that, unless otherwise required by law, the Trustee shall not be
required to provide access to such records and documentation if the provision
thereof would violate the legal right to privacy of any Mortgagor. The Trustee
shall allow representatives of the above entities to photocopy any of the
records and documentation and shall provide equipment for that purpose at a
charge that covers the Trustee's actual costs.
The Trustee shall execute and deliver to the related Servicer and the
Master Servicer any court pleadings, requests for trustee's sale or other
documents necessary or desirable to (i) the foreclosure or trustee's sale with
respect to a Mortgaged Property; (ii) any legal action brought to obtain
judgment against any Mortgagor on the Mortgage Note or Security Instrument;
(iii) obtain a deficiency judgment against the Mortgagor; or (iv) enforce any
other rights or remedies provided by the Mortgage Note or Security Instrument or
otherwise available at law or equity.
Section 3.02 REMIC-RELATED COVENANTS. For as long as each REMIC shall
exist, the Trustee and the Securities Administrator shall act in accordance
herewith to assure continuing treatment of such REMIC as a REMIC, and the
Trustee and the Securities Administrator shall comply with any directions of the
Depositor, the related Servicer or the Master Servicer to assure such continuing
treatment. In particular, the Trustee shall not (a) sell or permit the sale of
all or any portion of the Mortgage Loans or of any investment of deposits in an
Account unless such sale is as a result of a repurchase of the Mortgage Loans
pursuant to this Agreement or the Trustee has received a REMIC Opinion prepared
at the expense of the Trust; and (b) other than with respect to a substitution
pursuant to the Mortgage Loan Purchase Agreement or Section 2.04 of this
Agreement, as applicable, accept any contribution to any REMIC after the Startup
Day without receipt of a REMIC Opinion.
Section 3.03 MONITORING OF SERVICERS. (a) The Master Servicer shall be
responsible for reporting to the Trustee (on behalf of the Trust) and the
Depositor the compliance by each Servicer with its duties under the related
Servicing Agreement. In the review of each Servicer's activities, the Master
Servicer may rely upon an officer's certificate of the Servicer with regard to
such Servicer's compliance with the terms of its Servicing Agreement. In the
event that the Master Servicer, in its judgment, determines that a Servicer
should be terminated in accordance with its Servicing Agreement, or that a
notice should be sent pursuant to such Servicing Agreement with respect to the
occurrence of an event that, unless cured, would constitute grounds for such
termination, the Master Servicer shall notify the Depositor and the Trustee
thereof and the Master Servicer shall issue such notice or take such other
action as it deems appropriate.
(b) The Master Servicer, for the benefit of the Trust and the
Certificateholders, shall (acting as agent of the Trust when enforcing the
Trust's rights under each Servicing Agreement) (i) enforce the obligations of
each Servicer under the related Servicing Agreement and (ii) in the event that a
Servicer fails to perform its obligations in accordance with the related
Servicing Agreement, subject to the preceding paragraph, terminate the rights
and obligations of such Servicer thereunder and act as servicer of the related
Mortgage Loans or cause the Trustee to enter in to a new Servicing Agreement
with a successor Servicer selected by the Master Servicer; provided, however, it
is understood and acknowledged by the parties hereto that there will be a period
of transition (not to exceed 90 days) before the actual servicing functions can
be fully transferred to such successor Servicer. Such enforcement, including,
without limitation, the legal prosecution of claims, termination of Servicing
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 the Master Servicer, in
its good faith business judgment, would require were it the owner of the related
Mortgage Loans. The Master Servicer shall pay the costs of such enforcement at
its own expense, provided that the Master Servicer shall not be required to
prosecute or defend any legal action except to the extent that the Master
Servicer shall have received reasonable indemnity for its costs and expenses in
pursuing such action.
(c) To the extent that the costs and expenses of the Master Servicer
related to any termination of a Servicer, appointment of a successor Servicer or
the transfer and assumption of servicing by the Master Servicer with respect to
any Servicing Agreement (including, without limitation, (i) all legal costs and
expenses and all due diligence costs and expenses associated with an evaluation
of the potential termination of the Servicer as a result of an event of default
by such Servicer and (ii) all costs and expenses associated with the complete
transfer of servicing, including all servicing files and all servicing data and
the completion, correction or manipulation of such servicing data as may be
required by the successor servicer to correct any errors or insufficiencies in
the servicing data or otherwise to enable the successor servicer to service the
Mortgage Loans in accordance with the related Servicing Agreement) are not fully
and timely reimbursed by the terminated Servicer, the Master Servicer shall be
entitled to reimbursement of such costs and expenses from the Master Servicer
Collection Account.
(d) The Master Servicer shall require each Servicer to comply with the
remittance and certification requirements and other obligations set forth in the
related Servicing Agreement.
(e) If the Master Servicer acts as Servicer, it will not assume
liability for the representations and warranties of the Servicer, if any, that
it replaces.
(f) With respect to Additional Collateral Mortgage Loans, the Master
Servicer shall have no duty or obligation to supervise, monitor or oversee the
activities of any Servicer under its Servicing Agreement with respect to
Additional Collateral, except (a) with respect to any instances where a
Servicer, in the course of fulfilling its obligations under the related
Servicing Agreement seeks directions, instructions, consents or waivers from the
Master Servicer with respect to any item of Additional Collateral, or (b) upon
the occurrence of the following events (i) in the case of a final liquidation of
any Mortgaged Property secured by Additional Collateral, the Master Servicer
shall enforce the obligation of the Servicer under the related Servicing
Agreement to liquidate such Additional Collateral as required by such Servicing
Agreement, and (ii) if the Master Servicer assumes the obligations of such
Servicer as successor Servicer under the related Servicing Agreement pursuant to
this Section 3.03, as successor Servicer, it shall be bound to service and
administer the Additional Collateral in accordance with the provisions of such
Servicing Agreement.
Section 3.04 FIDELITY BOND. The Master Servicer, at its expense, shall
maintain in effect a blanket fidelity bond and an errors and omissions insurance
policy, affording coverage with respect to all directors, officers, employees
and other Persons acting on such Master Servicer's behalf, and covering errors
and omissions in the performance of the Master Servicer's obligations hereunder.
The errors and omissions insurance policy and the fidelity bond shall be in such
form and amount generally acceptable for entities serving as master servicers or
trustees.
Section 3.05 POWER TO ACT; PROCEDURES. The Master Servicer shall
master service the Mortgage Loans and shall have full power and authority,
subject to the REMIC Provisions and the provisions of Article X hereof, to do
any and all things that it may deem necessary or desirable in connection with
the master servicing and administration of the Mortgage Loans, including but not
limited to the power and authority (i) to execute and deliver, on behalf of the
Certificateholders, the Trust and the Trustee, customary consents or waivers and
other instruments and documents, (ii) to consent to transfers of any Mortgaged
Property and assumptions of the Mortgage Notes and related Mortgages, (iii) to
collect any Insurance Proceeds and Liquidation Proceeds, and (iv) to effectuate,
in its own name, on behalf the Trust, or in the name of the Trust, foreclosure
or other conversion of the ownership of the Mortgaged Property securing any
Mortgage Loan, in each case, in accordance with the provisions of this Agreement
and the related Servicing Agreement, as applicable; provided, however, that the
Master Servicer shall not (and, consistent with its responsibilities under
Section 3.03, shall not permit any Servicer to) knowingly or intentionally take
any action, or fail to take (or fail to cause to be taken) any action reasonably
within its control and the scope of duties more specifically set forth herein,
that, under the REMIC Provisions, if taken or not taken, as the case may be,
would cause REMIC I or REMIC II to fail to qualify as a REMIC or result in the
imposition of a tax upon the Trust (including but not limited to the tax on
prohibited transactions as defined in Section 860F(a)(2) of the Code and the tax
on contributions to a REMIC set forth in Section 860G(d) of the Code) unless the
Master Servicer has received an Opinion of Counsel (but not at the expense of
the Master Servicer) to the effect that the contemplated action will not cause
REMIC I or REMIC II to fail to qualify as a REMIC or result in the imposition of
a tax upon REMIC I or REMIC II, as the case may be. The Trustee shall furnish
the Master Servicer, upon written request from a servicing officer, with any
limited powers of attorney empowering the Master Servicer or any Servicer to
execute and deliver instruments of satisfaction or cancellation, or of partial
or full release or discharge, and to foreclose upon or otherwise liquidate
Mortgaged Property, and to appeal, prosecute or defend in any court action
relating to the Mortgage Loans or the Mortgaged Property, in accordance with the
applicable Servicing Agreement and this Agreement, and the Trustee shall execute
and deliver such other documents, as the Master Servicer may request, to enable
the Master Servicer to master service and administer the Mortgage Loans and
carry out its duties hereunder, in each case in accordance with Accepted Master
Servicing Practices (and the Trustee shall have no liability for misuse of any
such powers of attorney by the Master Servicer or any Servicer). In instituting
foreclosures or similar proceedings, the Master Servicer shall institute such
proceedings either in its own name on behalf of the Trust or in the name of the
Trust (or cause the related Servicer, pursuant to the related Servicing
Agreement, to institute such proceedings either in the name of such Servicer on
behalf of the Trust or in the name of the Trust), unless otherwise required by
law or otherwise appropriate. If the Master Servicer or the Trustee has been
advised that it is likely that the laws of the state in which action is to be
taken prohibit such action if taken in the name of the Trust or the Trustee on
its behalf or that the Trust or the Trustee, as applicable, would be adversely
affected under the "doing business" or tax laws of such state if such action is
taken in its name, the Master Servicer shall join with the Trustee, on behalf of
the Trust, in the appointment of a co-trustee pursuant to Section 9.11 hereof.
In the performance of its duties hereunder, the Master Servicer shall be an
independent contractor and shall not, except in those instances where it is
taking action in the name of the Trustee, be deemed to be the agent of the
Trustee.
Section 3.06 DUE-ON-SALE CLAUSES; ASSUMPTION AGREEMENTS. To the extent
provided in the applicable Servicing Agreement and to the extent Mortgage Loans
contain enforceable due-on-sale clauses, the Master Servicer shall cause the
Servicers to enforce such clauses in accordance with the applicable Servicing
Agreement. If applicable law prohibits the enforcement of a due-on-sale clause
or such clause is otherwise not enforced in accordance with the applicable
Servicing Agreement, and, as a consequence, a Mortgage Loan is assumed, the
original Mortgagor may be released from liability in accordance with the
applicable Servicing Agreement.
Section 3.07 RELEASE OF MORTGAGE FILES. (a) Upon becoming aware of the
payment in full of any Mortgage Loan, or the receipt by any Servicer of a
notification that payment in full has been escrowed in a manner customary for
such purposes for payment to Certificateholders on the next Distribution Date,
the Master Servicer will cause the Servicer, if required under the applicable
Servicing Agreement, to promptly furnish to the Custodian, on behalf of the
Trustee, two copies of a certification substantially in the form of Exhibit D
hereto signed by a servicing officer or in a mutually agreeable electronic
format which will, in lieu of a signature on its face, originate from a
servicing officer (which certification shall include a statement to the effect
that all amounts received in connection with such payment that are required to
be deposited in the related Servicer Account maintained by the applicable
Servicer pursuant to Section 4.01 or by the applicable Servicer pursuant to its
Servicing Agreement have been or will be so deposited) and shall request that
the Trustee (or the Custodian, on behalf of the Trustee) deliver to the
applicable Servicer the related Mortgage File. Upon receipt of such
certification and request, the Trustee (or the Custodian, on behalf of the
Trustee), shall promptly release the related Mortgage File to the applicable
Servicer and the Trustee (and the Custodian, if applicable) shall have no
further responsibility with regard to such Mortgage File. Upon any such payment
in full, each Servicer is authorized, to give, as agent for the Trustee, as the
mortgagee under the Mortgage that secured the Mortgage Loan, an instrument of
satisfaction (or assignment of mortgage without recourse) regarding the
Mortgaged Property subject to the Mortgage, which instrument of satisfaction or
assignment, as the case may be, shall be delivered to the Person or Persons
entitled thereto against receipt therefor of such payment, it being understood
and agreed that no expenses incurred in connection with such instrument of
satisfaction or assignment, as the case may be, shall be chargeable to the
related Servicer Account.
(b) From time to time and as appropriate for the servicing or
foreclosure of any Mortgage Loan and in accordance with the applicable Servicing
Agreement, the Trustee shall execute such documents as shall be prepared and
furnished to the Trustee by a Servicer or the Master Servicer (in form
reasonably acceptable to the Trustee) and as are necessary to the prosecution of
any such proceedings. The Trustee (or the Custodian, on behalf of the Trustee),
shall, upon the request of a Servicer or the Master Servicer, and delivery to
the Trustee (the Custodian, on behalf of the Trustee), of two copies of a
request for release signed by a servicing officer substantially in the form of
Exhibit D (or in a mutually agreeable electronic format which will, in lieu of a
signature on its face, originate from a servicing officer), release the related
Mortgage File held in its possession or control to the Servicer or the Master
Servicer, as applicable. Such trust receipt shall obligate the Servicer or the
Master Servicer to return the Mortgage File to the Trustee (or the Custodian on
behalf of the Trustee) when the need therefor by the Servicer or the Master
Servicer no longer exists unless the Mortgage Loan shall be liquidated, in which
case, upon receipt of a certificate of a servicing officer similar to that
hereinabove specified, the Mortgage File shall be released by the Trustee (or
the Custodian on behalf of the Trustee), to the Servicer or the Master Servicer.
Section 3.08 DOCUMENTS, RECORDS AND FUNDS IN POSSESSION OF MASTER
SERVICER TO BE HELD FOR TRUST.
(a) The Master Servicer shall transmit and each Servicer (to the
extent required by the related Servicing Agreement) shall transmit to the
Trustee (or Custodian) such documents and instruments coming into the possession
of the Master Servicer or such Servicer from time to time as are required by the
terms hereof, or in the case of the Servicers, the applicable Servicing
Agreement, to be delivered to the Trustee (or Custodian). Any funds received by
the Master Servicer or by a Servicer in respect of any Mortgage Loan or which
otherwise are collected by the Master Servicer or by a Servicer as Net
Liquidation Proceeds or Insurance Proceeds in respect of any Mortgage Loan shall
be held for the benefit of the Trust and the Certificateholders subject to the
Master Servicer's right to retain or withdraw from the Master Servicer
Collection Account the Master Servicing Fee, any additional compensation
pursuant to Section 3.14 and any other amounts provided in this Agreement, and
to the right of each Servicer to retain its Servicing Fee and any other amounts
as provided in the applicable Servicing Agreement. The Master Servicer shall,
and (to the extent provided in the applicable Servicing Agreement) shall cause
each Servicer to, provide access to information and documentation regarding the
Mortgage Loans to the Trustee, its agents and accountants at any time upon
reasonable request and during normal business hours, and to Certificateholders
that are savings and loan associations, banks or insurance companies, the Office
of Thrift Supervision, the FDIC and the supervisory agents and examiners of such
Office and Corporation or examiners of any other federal or state banking or
insurance regulatory authority if so required by applicable regulations of the
Office of Thrift Supervision or other regulatory authority, such access to be
afforded without charge but only upon reasonable request in writing and during
normal business hours at the offices of the Master Servicer designated by it. In
fulfilling such a request the Master Servicer shall not be responsible for
determining the sufficiency of such information.
(b) All Mortgage Files and funds collected or held by, or under the
control of, the Master Servicer, in respect of any Mortgage Loans, whether from
the collection of principal and interest payments or from Net Liquidation
Proceeds or Insurance Proceeds, shall be held by the Master Servicer for and on
behalf of the Trust and the Certificateholders and shall be and remain the sole
and exclusive property of the Trust; provided, however, that the Master Servicer
and each Servicer shall be entitled to setoff against, and deduct from, any such
funds any amounts that are properly due and payable to the Master Servicer or
such Servicer under this Agreement or the applicable Servicing Agreement.
Section 3.09 STANDARD HAZARD INSURANCE AND FLOOD INSURANCE POLICIES.
(a) For each Mortgage Loan (other than a Cooperative Loan), the Master
Servicer shall enforce any obligation of the Servicers under the related
Servicing Agreements to maintain or cause to be maintained standard fire and
casualty insurance and, where applicable, flood insurance, all in accordance
with the provisions of the related Servicing Agreements. It is understood and
agreed that such insurance shall be with insurers meeting the eligibility
requirements set forth in the applicable Servicing Agreement and that no
earthquake or other additional insurance is to be required of any Mortgagor or
to be maintained on property acquired in respect of a defaulted loan, other than
pursuant to such applicable laws and regulations as shall at any time be in
force and as shall require such additional insurance.
(b) Pursuant to Section 4.01 and 4.02, any amounts collected by the
Servicers or the Master Servicer, or by any Servicer, under any insurance
policies (other than amounts to be applied to the restoration or repair of the
property subject to the related Mortgage or released to the Mortgagor in
accordance with the applicable Servicing Agreement) shall be deposited into the
Master Servicer Collection Account, subject to withdrawal pursuant to Section
4.02 and 4.03. Any cost incurred by the Master Servicer or any Servicer in
maintaining any such insurance if the Mortgagor defaults in its obligation to do
so shall be added to the amount owing under the Mortgage Loan where the terms of
the Mortgage Loan so permit; provided, however, that the addition of any such
cost shall not be taken into account for purposes of calculating the
distributions to be made to Certificateholders and shall be recoverable by the
Master Servicer or such Servicer pursuant to Section 4.02 and 4.03.
Section 3.10 PRESENTMENT OF CLAIMS AND COLLECTION OF PROCEEDS. The
Master Servicer shall (to the extent provided in the applicable Servicing
Agreement) cause the related Servicer to, prepare and present on behalf of the
Trustee, the Trust and the Certificateholders all claims under the Insurance
Policies and take such actions (including the negotiation, settlement,
compromise or enforcement of the insured's claim) as shall be necessary to
realize recovery under such policies. Any proceeds disbursed to the Master
Servicer (or disbursed to a Servicer and remitted to the Master Servicer) in
respect of such policies, bonds or contracts shall be promptly deposited in the
Master Servicer Collection Account upon receipt, except that any amounts
realized that are to be applied to the repair or restoration of the related
Mortgaged Property as a condition precedent to the presentation of claims on the
related Mortgage Loan to the insurer under any applicable Insurance Policy need
not be so deposited (or remitted).
Section 3.11 MAINTENANCE OF THE PRIMARY MORTGAGE INSURANCE POLICIES.
(a) The Master Servicer shall not take, or permit any Servicer (to the
extent such action is prohibited under the applicable Servicing Agreement) to
take, any action that would result in noncoverage under any applicable Primary
Mortgage Insurance Policy of any loss which, but for the actions of such Master
Servicer or Servicer, would have been covered thereunder. The Master Servicer
shall use its best reasonable efforts to cause each Servicer (to the extent
required under the related Servicing Agreement) to keep in force and effect (to
the extent that the Mortgage Loan requires the Mortgagor to maintain such
insurance), primary mortgage insurance applicable to each Mortgage Loan in
accordance with the provisions of this Agreement and the related Servicing
Agreement, as applicable. The Master Servicer shall not, and shall not permit
any Servicer (to the extent required under the related Servicing Agreement) to,
cancel or refuse to renew any such Primary Mortgage Insurance Policy that is in
effect at the date of the initial issuance of the Mortgage Note and is required
to be kept in force hereunder except in accordance with the provisions of this
Agreement and the related Servicing Agreement, as applicable.
(b) The Master Servicer agrees to cause each Servicer (to the extent
required under the related Servicing Agreement) to present, on behalf of the
Trustee, the Trust and the Certificateholders, claims to the insurer under any
Primary Mortgage Insurance Policies and, in this regard, to take such reasonable
action as shall be necessary to permit recovery under any Primary Mortgage
Insurance Policies respecting defaulted Mortgage Loans. Pursuant to Section 4.01
and 4.02, any amounts collected by the Servicer under any Primary Mortgage
Insurance Policies shall be deposited in the Master Servicer Collection Account,
subject to withdrawal pursuant to Section 4.03.
Section 3.12 TRUSTEE TO RETAIN POSSESSION OF CERTAIN INSURANCE
POLICIES AND DOCUMENTS. The Trustee (or the Custodian, as directed by the
Trustee), shall retain possession and custody of the originals (to the extent
available) of any Primary Mortgage Insurance Policies, or certificate of
insurance if applicable, and any certificates of renewal as to the foregoing as
may be issued from time to time as contemplated by this Agreement. Until all
amounts distributable in respect of the Certificates have been distributed in
full and the Master Servicer otherwise has fulfilled its obligations under this
Agreement, the Trustee (or its Custodian, if any, as directed by the Trustee)
shall also retain possession and custody of each Mortgage File in accordance
with and subject to the terms and conditions of this Agreement. The Master
Servicer shall promptly deliver or cause to be delivered to the Trustee (or the
Custodian, as directed by the Trustee), upon the execution or receipt thereof
the originals of any Primary Mortgage Insurance Policies, any certificates of
renewal, and such other documents or instruments that constitute portions of the
Mortgage File that come into the possession of the Master Servicer from time to
time.
Section 3.13 REALIZATION UPON DEFAULTED MORTGAGE LOANS. The Master
Servicer shall cause each Servicer (to the extent required under the related
Servicing Agreement) to foreclose upon, repossess or otherwise comparably
convert the ownership of Mortgaged 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, all in
accordance with the applicable Servicing Agreement.
Section 3.13A. REALIZATION UPON TROUBLED MORTGAGE LOANS. The Master
Servicer shall have the right to cause a Servicer to sell or work out any
Mortgage Loan as to which the Master Servicer reasonably believes that default
in payment is likely, provided, however, that, with respect to any such sale of
a Mortgage Loan by a Servicer, the related sale price shall be no less than the
Scheduled Principal Balance of such Mortgage Loan as of the last day of the Due
Period immediately preceding the date of such sale plus accrued interest thereon
through such sale date. Any and all proceeds from such a sale shall be deemed to
be Liquidation Proceeds hereunder and any such Mortgage Loan which has been sold
shall be deemed a Liquidated Mortgage Loan hereunder.
Section 3.14 ADDITIONAL COMPENSATION TO THE MASTER SERVICER. Pursuant
to Section 4.02(c), certain income and gain realized from any investment of
funds in the Master Servicer Collection Account shall be for the benefit of the
Master Servicer as additional compensation. Servicing compensation in the form
of assumption fees, if any, late payment charges, as collected, if any, or
otherwise (but, unless otherwise specifically permitted in a Servicing
Agreement, not including any Prepayment Penalty Amounts) shall be retained by
the applicable Servicer, or the Master Servicer, and shall not be deposited in
the related Servicer Account or Master Servicer Collection Account. The Master
Servicer shall be required to pay all expenses incurred by it in connection with
its activities hereunder and shall not be entitled to reimbursement therefor
except as provided in this Agreement. The amount of the aggregate compensation
payable as set forth in this Section 3.14 plus the Master Servicing Fee due to
the Master Servicer in respect of any Distribution Date shall be reduced in
accordance with Section 6.07.
Section 3.15 REO PROPERTY.
(a) In the event the Trust (or the Trustee on its behalf) acquires
ownership of any REO Property in respect of any related Mortgage Loan, the deed
or certificate of sale shall be issued to the Trust, or if required under
applicable law, to the Trustee, or to its nominee, on behalf of the Trust. The
Master Servicer shall, to the extent provided in the applicable Servicing
Agreement, cause the applicable Servicer to sell, any REO Property as
expeditiously as possible (and in no event later than three years after
acquisition) and in accordance with the provisions of this Agreement and the
related Servicing Agreement, as applicable. Pursuant to its efforts to sell such
REO Property, the Master Servicer shall cause the applicable Servicer to protect
and conserve, such REO Property in the manner and to the extent required by the
applicable Servicing Agreement, in accordance with the REMIC Provisions and in a
manner that does not result in a tax on "net income from foreclosure property"
or cause such REO Property to fail to qualify as "foreclosure property" within
the meaning of Section 860G(a)(8) of the Code.
(b) The Master Servicer shall, to the extent required by the related
Servicing Agreement, cause the applicable Servicer to deposit all funds
collected and received in connection with the operation of any REO Property in
the related Servicer Account.
(c) The Master Servicer and the applicable Servicer, upon the final
disposition of any REO Property, shall be entitled to reimbursement for any
related unreimbursed Monthly Advances and other unreimbursed advances as well as
any unpaid Servicing Fees from Liquidation Proceeds received in connection with
the final disposition of such REO Property; provided, that any such unreimbursed
Monthly Advances as well as any unpaid Servicing Fees may be reimbursed or paid,
as the case may be, prior to final disposition, out of any net rental income or
other net amounts derived from such REO Property.
(d) To the extent provided in the related Servicing Agreement, the
Liquidation Proceeds from the final disposition of the REO Property, net of any
payment to the Master Servicer and the applicable Servicer as provided above
shall be deposited in the related Servicer Account on or prior to the applicable
Determination Date in the month following receipt thereof and be remitted by
wire transfer in immediately available funds to the Master Servicer for deposit
into the Master Servicer Collection Account on the next succeeding Remittance
Date.
Section 3.16 ANNUAL OFFICER'S CERTIFICATE AS TO COMPLIANCE.
(a) The Master Servicer shall deliver to the Securities Administrator,
the Depositor, the Trustee and each Rating Agency on or before March 1 of each
year, commencing in March, 2005, an Officer's Certificate, certifying that with
respect to the period ending December 31 of the prior year: (i) the officer
certifying such Officer's Certificate has reviewed the activities of such Master
Servicer during the preceding calendar year or portion thereof and its
performance under this Agreement, (ii) to the best of such officer's knowledge,
based on such review, such Master Servicer has performed and fulfilled its
duties, responsibilities and obligations under this Agreement in all material
respects throughout such year, or, if there has been a default in the
fulfillment of any such duties, responsibilities or obligations, specifying each
such default known to such officer and the nature and status thereof, and (iii)
nothing has come to the attention of such officer to lead such officer to
believe that any Servicer has failed to perform any of its duties,
responsibilities and obligations under its Servicing Agreement in all material
respects throughout such year, or, if there has been a material default in the
performance or fulfillment of any such duties, responsibilities or obligations,
specifying each such default known to such officer and the nature and status
thereof.
(b) Copies of such statements shall be provided by the Trustee to any
Certificateholder upon request at the Master Servicer's expense, provided that
such statement shall have been delivered to the Trustee.
Section 3.17 ANNUAL INDEPENDENT ACCOUNTANT'S SERVICING REPORT. If the
Master Servicer has, during the course of any calendar year, directly serviced
any of the Mortgage Loans, the Master Servicer, at its expense, shall cause a
nationally recognized firm of independent certified public accountants to
furnish a statement to the Securities Administrator, the Trustee, the Rating
Agencies and the Depositor by March 1, 2005, and by March 1 of each year
thereafter, in each case for the immediately preceding calendar year, to the
effect that, with respect to the most recently ended calendar year, such firm
has examined certain records and documents relating to the Master Servicer's
performance of its servicing obligations under this Agreement and pooling and
servicing and trust agreements in material respects similar to this Agreement
and to each other and that, on the basis of such examination conducted
substantially in compliance with the audit program for mortgages serviced for
▇▇▇▇▇▇▇ Mac or the Uniform Single Attestation Program for Mortgage Bankers, such
firm is of the opinion that the Master Servicer's activities have been conducted
in compliance with this Agreement, or that such examination has disclosed no
material items of noncompliance except for (i) such exceptions as such firm
believes to be immaterial, (ii) such other exceptions as are set forth in such
statement and (iii) such exceptions that the Uniform Single Attestation Program
for Mortgage Bankers or the Audit Program for Mortgages Serviced by ▇▇▇▇▇▇▇ Mac
requires it to report. Copies of such statements shall be provided to any
Certificateholder, upon request, by the Master Servicer, or by the Trustee at
the expense of the Master Servicer if the Master Servicer shall fail to provide
such copies. If any such report discloses exceptions that are material, the
Master Servicer shall advise the Trustee whether such exceptions have been or
are susceptible of cure, and will take prompt action to do so.
Section 3.18 REPORTS FILED WITH SECURITIES AND EXCHANGE COMMISSION.
Within 15 days after each Distribution Date, the Securities Administrator shall,
in accordance with industry standards, file with the Commission via the
Electronic Data Gathering and Retrieval System ("▇▇▇▇▇"), a Form 8-K with a copy
of the statement to the Trustee who shall furnish a copy of the statement to the
Certificateholders for such Distribution Date as an exhibit thereto. Prior to
January 30 in the first year that it has received prior instructions from the
Depositor to do so, the Securities Administrator shall, in accordance with
industry standards and only if instructed by the Depositor, file a Form 15
Suspension Notice with respect to the Trust, if applicable. On or prior to (i)
March 1, 2005 and (ii) unless and until a Form 15 Suspension Notice shall have
been filed, on or prior to March 1 of each year thereafter, the Master Servicer
shall provide the Securities Administrator with a Master Servicer Certification,
together with a copy of the annual independent accountant's servicing report and
annual statement of compliance of each Servicer, in each case, required to be
delivered pursuant to its Servicing Agreement, and, if applicable, the annual
independent accountant's servicing report and annual statement of compliance to
be delivered by the Master Servicer pursuant to Section 3.16 and 3.17. On or
prior to March 31, 2005 and, unless and until a Form 15 Suspension Notice shall
have been filed, on or prior to March 31 of each year thereafter, the Securities
Administrator shall file a Form 10-K, in substance conforming to industry
standards, with respect to the Trust. Such Form 10-K shall include the Master
Servicer Certification and other documentation provided by the Master Servicer
pursuant to the second preceding sentence. The Depositor hereby grants to the
Securities Administrator a limited power of attorney to execute and file each
such document on behalf of the Depositor. Such power of attorney shall continue
until either the earlier of (i) receipt by the Securities Administrator from the
Depositor of written termination of such power of attorney and (ii) the
termination of the Trust. The Depositor agrees to promptly furnish to the
Securities Administrator, from time to time upon request, such further
information, reports and financial statements within its control related to this
Agreement, the Mortgage Loans as the Securities Administrator reasonably deems
appropriate to prepare and file all necessary reports with the Commission. The
Securities Administrator shall have no responsibility to file any items other
than those specified in this Section 3.18; provided, however, the Securities
Administrator will cooperate with the Depositor in connection with any
additional filings with respect to the Trust as the Depositor deems necessary
under the Securities Exchange Act of 1934, as amended (the "Exchange Act").
Copies of all reports filed by the Securities Administrator under the Exchange
Act shall be sent to: the Depositor c/o Bear, ▇▇▇▇▇▇▇ & Co. Inc., Attn: Managing
Director-Analysis and Control, ▇▇▇ ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇, ▇▇▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇
▇▇▇▇▇-▇▇▇▇. Fees and expenses incurred by the Securities Administrator in
connection with this Section 3.18 shall not be reimbursable from the Trust.
Section 3.19 AMENDMENTS TO MASTER SERVICING GUIDE AND CORRESPONDENT
SELLERS GUIDE. The Seller and the Master Servicer hereby agree not to amend the
Master Servicing Guide or the Correspondent Sellers Guide with respect to the
Mortgage Loans (which are Securitized Loans (as defined therein)) which
amendment would (i) change the Servicer Remittance Date or date for remittance
of any servicer reports or monthly remittance advices, (ii) change the manner in
which any Servicer makes Advances, servicing advances or amounts to compensate
for Interest Shortfalls or (iii) otherwise have a material adverse effect on the
Trust or the Certificateholders unless such changes are made pursuant to the
provisions of Section 11.02 hereof.
Section 3.20 UCC. The Trustee agrees to file continuation statements
for any Uniform Commercial Code financing statements which the Depositor has
informed the Trustee were filed on the Closing Date in connection with the
Trust. The Depositor shall file any financing statements or amendments thereto
required by any change in the Uniform Commercial Code.
Section 3.21 PURCHASE OF CERTAIN MORTGAGE LOANS.
(a) ▇▇▇▇▇▇▇▇▇, in its capacity as a Servicer of a substantial portion
of the Mortgage Loans, shall have the right to purchase from the Trust any
Mortgage Loan which as of the first day of a Calendar Quarter is delinquent in
payment by 90 days or more or is an REO Property, at a price equal to the
Repurchase Price; provided however (i) that such Mortgage Loan is still 90 days
or more delinquent or is an REO Property as of the date of such purchase and
(ii) this purchase option, if not theretofore exercised, shall terminate on the
date prior to the last day of the related Calendar Quarter. This purchase
option, if not exercised, shall not be thereafter reinstated unless the
delinquency is cured and the Mortgage Loan thereafter again becomes 90 days or
more delinquent or becomes an REO Property, in which case the option shall again
become exercisable as of the first day of the related Calendar Quarter.
(b) (i) In addition, ▇▇▇▇▇▇▇▇▇, in its capacity as the Seller, may,
but is not required to, repurchase any Mortgage Loan as to which the Mortgagor
has requested a Significant Modification and such Mortgagor has a satisfactory
payment history under such Mortgage Loan and meets the credit standards of the
Seller for the loan program selected (a "Significant Modification Loan"). A
"Significant Modification" shall mean any modification to the interest rate of
the greater of (a) 0.25% added or subtracted from the existing rate and (b) a
change equal to the product of (1) 5% and (2) the annual existing interest rate
thereon, which is not provided for in the related Mortgage Note. The purchase
price for any such repurchase pursuant to this Section 3.21(b)(i) shall be the
applicable Repurchase Price. In order to exercise its repurchase rights
hereunder, the Seller shall deliver to the Master Servicer and the Trustee a
certificate identifying the Mortgage Loan to be repurchased and certifying that
(i) such Mortgage Loan is a Significant Modification Loan, and (ii) that the
Significant Modification Loan will be entered into on the date of such
repurchase.
(ii) No later than the fourth Business Day prior to each
Distribution Date, ▇▇▇▇▇▇▇▇▇ will provide to the Master Servicer a
list identifying all Mortgage Loans that became Converted Mortgage
Loans or Modified Mortgage Loans during the related Due Period. On the
third Business Day prior to each Distribution Date, provided that it
has received such list from ▇▇▇▇▇▇▇▇▇, the Master Servicer shall
prepare and provide to TMI a Converted Mortgage Loan Schedule and a
Modified Mortgage Loan Schedule with respect to such Due Period. No
later than 1:00 PM Eastern Time on the second Business Day prior to
each Distribution Date, TMI shall purchase each Converted Mortgage
Loan and Modified Mortgage Loan, to the extent specified in a
Converted Mortgage Loan Schedule or Modified Mortgage Loan Schedule
delivered to it by the Master Servicer for such Distribution Date, at
the applicable Repurchase Price for each such Converted Mortgage Loan
or Modified Mortgage Loan, as applicable, and shall remit such
Repurchase Price to the Master Servicer for deposit in the Master
Servicer Collection Account.
(c) If at any time ▇▇▇▇▇▇▇▇▇ or TMI, as applicable, remits to the
Master Servicer a payment for deposit in the Master Servicer Collection Account
covering the amount of the Repurchase Price for a Mortgage Loan of the type set
forth in clauses (a) or (b) above, and ▇▇▇▇▇▇▇▇▇ or TMI, as applicable, provides
to the Trustee a certification signed by a servicing or other responsible
officer stating that the amount of such payment has been deposited in the Master
Servicer Collection Account, then the Trustee shall execute the assignment of
such Mortgage Loan at the request of ▇▇▇▇▇▇▇▇▇ or TMI, as applicable, without
recourse to ▇▇▇▇▇▇▇▇▇ or TMI, as applicable, which shall succeed to all the
Trust's and/or the Trustee's right, title and interest in and to such Mortgage
Loan, and all security and documents relative thereto. Such assignment shall be
an assignment outright and not for security. ▇▇▇▇▇▇▇▇▇ or TMI, as applicable,
will thereupon own such Mortgage Loan, and all such security and documents, free
of any further obligation to the Trust, the Trustee or the Certificateholders
with respect thereto.
Section 3.22 INSTRUCTIONS TO THE TRUSTEE. In the event that the
Trustee is required under a Servicing Agreement to give any waivers, consents or
instructions to the related Servicer, if the Trustee reasonably believes that
such actions (i) are not ministerial in nature, (ii) involve the waiver of any
defaults by a Servicer, or (iii) pertain to the termination of a Servicer or the
Servicing Agreement, the Trustee may seek written directions from the Holders of
51% of the Fractional Undivided Interests of the Class I-M Certificates or the
Class II-M Certificates if the matter relates solely to Group I Mortgage Loans
or Group II Mortgage Loans, respectively, or of both the Class I-M and Class
II-M Certificates if the matter relates to both Group I and Group II Mortgage
Loans. In the absence of such instruction from the requisite applicable
Certificateholders, the Trustee may seek such instructions from the Holders of
51% of the Fractional Undivided Interests of the Group I Senior Certificates or
the Group II Senior Certificates if the matter relates solely to the Group I
Mortgage Loans or the Group II Mortgage Loans, respectively, or of all the
Senior Certificates if the matter relates to both Group I and Group II Mortgage
Loans. If the Trustee does not receive any such requested instructions, the
Trustee may refrain from giving any consent, waiver, instruction or direction to
the related Servicer and shall not be liable for any losses or damages resulting
from such failure to give such requested consents, waivers, instructions or
directions.
ARTICLE IV
Accounts
Section 4.01 SERVICER ACCOUNTS. (a) The Master Servicer shall enforce
the obligation of each Servicer to establish and maintain one or more Servicer
Accounts in accordance with the applicable Servicing Agreement, with records to
be kept with respect thereto on a Mortgage Loan by Mortgage Loan basis, into
which accounts shall be deposited within 48 hours (or as of such other time
specified in the related Servicing Agreement) of receipt all collections of
principal and interest on any Mortgage Loan and with respect to any REO Property
received by a Servicer, including Principal Prepayments, Insurance Proceeds, Net
Liquidation Proceeds, Subsequent Recoveries and advances made from the
Servicer's own funds (less, in the case of each Servicer, the applicable
servicing compensation, in whatever form and amounts as permitted by the
applicable Servicing Agreement) and all other amounts to be deposited in each
such Servicer Account. The Servicer is hereby authorized to make withdrawals
from and deposits to the related Servicer Account for purposes required or
permitted by this Agreement and the applicable Servicing Agreement. For the
purposes of this Agreement, Servicer Accounts shall also include such other
accounts as the Servicer maintains for the escrow of certain payments, such as
taxes and insurance, with respect to certain Mortgaged Properties. Each
Servicing Agreement sets forth the criteria for the segregation, maintenance and
investment of each related Servicer Account, the contents of which are
acceptable to the parties hereto as of the date hereof and changes to which
shall not be made unless such changes are made in accordance with the provisions
of Section 11.02 hereof.
(b) [Reserved];
(c) To the extent provided in the related Servicing Agreement and
subject to this Article IV, on or before each applicable Servicer Remittance
Date, each Servicer shall withdraw or shall cause to be withdrawn from the
related Servicer Accounts and shall immediately deposit or cause to be deposited
in the Master Servicer Collection Account amounts representing the following
collections and payments (other than with respect to principal of or interest on
the Mortgage Loans due on or before the Cut-off Date) with respect to each of
the Mortgage Loans it is servicing:
(i) Scheduled Payments on the Mortgage Loans received or any
related portion thereof advanced by the Servicers pursuant to the
Servicing Agreements which were due on or before the related Due Date,
net of the amount thereof comprising the Servicing Fees;
(ii) Full Principal Prepayments and any Net Liquidation Proceeds
received by the Servicers with respect to such Mortgage Loans in the
related Prepayment Period, with interest to the date of prepayment or
liquidation, net of the amount thereof comprising the Servicing Fees,
and any Subsequent Recoveries received in the related Prepayment
Period;
(iii) Partial Principal Prepayments received by the Servicers for
such Mortgage Loans in the related Prepayment Period;
(iv) Prepayment Penalty Amounts, if any, and only if required
under the related Servicing Agreement; and
(v) Any amount to be used as a Monthly Advance or Compensating
Interest Payment.
(d) Withdrawals may be made from a Servicer Account only to make
remittances as provided in Section 4.01(c), 4.02 and 4.03; to reimburse the
Master Servicer or a Servicer for Monthly Advances which have been recovered by
subsequent collection from the related Mortgagor; to remove amounts deposited in
error; to remove fees, charges or other such amounts deposited on a temporary
basis; or to clear and terminate the account at the termination of this
Agreement in accordance with Section 10.01. As provided in Sections 4.01(c) and
4.02(b), certain amounts otherwise due to the Servicers may be retained by them
and need not be deposited in the Master Servicer Collection Account.
Section 4.02 MASTER SERVICER COLLECTION ACCOUNT. (a) The Master
Servicer shall establish and maintain in the name of the Trustee, for the
benefit of the Trust and the Certificateholders, the Master Servicer Collection
Account as a segregated account, each of which shall be an Eligible Account. The
Master Servicer will deposit in the Master Servicer Collection Account as
identified by the Master Servicer and as received by the Master Servicer, the
following amounts:
(i) Any amounts withdrawn from a Servicer Account;
(ii) Any Monthly Advance and any Compensating Interest Payments
received from a Servicer, or required to be made by the Master
Servicer to the extent required but not made by a Servicer;
(iii) Any Insurance Proceeds, Liquidation Proceeds or Subsequent
Recoveries received by or on behalf of the Master Servicer or which
were not deposited in a Servicer Account;
(iv) The Repurchase Price with respect to any Mortgage Loans
purchased by the Seller pursuant to Section 2.02, 2.03 or 3.21, any
Substitution Adjustment Amounts, the Repurchase Price with respect to
any Mortgage Loans purchased by TMI pursuant to Section 3.21, and all
proceeds of any Mortgage Loans or property acquired with respect
thereto purchased pursuant to Section 10.01;
(v) Any amounts required to be deposited with respect to losses
on investments of deposits in the Master Servicer Collection Account;
and
(vi) Any other amounts received by or on behalf of the Master
Servicer or the Trustee and required to be deposited in the Master
Servicer Collection Account pursuant to this Agreement.
(b) All amounts deposited to the Master Servicer Collection Account
shall be held by the Master Servicer in the name of the Trustee in trust for the
benefit of the Trust and Certificateholders in accordance with the terms and
provisions of this Agreement. The requirements for crediting the Master Servicer
Collection Account or the Distribution Account shall be exclusive, it being
understood and agreed that, without limiting the generality of the foregoing,
payments in the nature of (i) late payment charges or assumption, tax service,
statement account or payoff, substitution, satisfaction, release and other like
fees and charges (but excluding all Prepayment Penalty Amounts) and (ii) the
items enumerated in Subsections 4.03(a)(i), (ii), (iii), (iv), (vi), (vii), (ix)
and (x) with respect to the Securities Administrator, need not be credited by
the Master Servicer or the related Servicer to the Distribution Account or the
Master Servicer Collection Account, as applicable. In the event that the Master
Servicer shall deposit or cause to be deposited to the Distribution Account any
amount not required to be credited thereto, the Trustee, upon receipt of a
written request therefor signed by a servicing officer of the Master Servicer,
shall promptly transfer such amount to the Master Servicer, any provision herein
to the contrary notwithstanding.
(c) The amount at any time credited to the Master Servicer Collection
Account shall be invested, in the name of the Trustee, or its nominee, for the
benefit of the Trust, in Permitted Investments as follows. All Permitted
Investments shall be for the benefit of ▇▇▇▇▇▇▇▇▇, in its capacity as Servicer,
except that the investment income with respect to the investment of all funds on
deposit in the Master Servicer Collection Account earned on the Business Day
prior to the Distribution Account Deposit Date shall be for the benefit of the
Master Servicer. All Permitted Investments made for the benefit of ▇▇▇▇▇▇▇▇▇
shall be made at the written direction of ▇▇▇▇▇▇▇▇▇ to the Master Servicer (or,
if no such written direction is received, in investments of the type specified
in clause (v) of the definition of Permitted Investments), shall mature or be
subject to redemption or withdrawal on or before, and shall be held until, the
Business Day prior to the next succeeding Distribution Account Deposit Date. Any
and all investment earnings from such Permitted Investments shall be paid to
▇▇▇▇▇▇▇▇▇, and the risk of loss of moneys resulting from such investments shall
be borne by and be the risk of ▇▇▇▇▇▇▇▇▇. ▇▇▇▇▇▇▇▇▇ shall deposit the amount of
any such loss in the Master Servicer Collection Account within two Business Days
of receipt of notification of such loss but not later than the next succeeding
Distribution Account Deposit Date.
All Permitted Investments for the benefit of the Master Servicer shall
be in such Permitted Investments as shall be selected by the Master Servicer and
shall mature (and be subject to withdrawal and held until) the next succeeding
Distribution Account Deposit Date. Any and all investment earnings from such
Permitted Investments shall be paid to the Master Servicer and the risk of loss
on such Permitted Investments shall be borne by and be the risk of the Master
Servicer. The Master Servicer shall deposit the amount of any such loss in the
Master Servicer Collection Account no later than the next succeeding
Distribution Account Deposit Date.
Section 4.03 PERMITTED WITHDRAWALS AND TRANSFERS FROM THE MASTER
SERVICER COLLECTION ACCOUNT. (a) The Master Servicer will, from time to time on
demand of a Servicer, the Securities Administrator, or for its own account as
set forth below, make or cause to be made such withdrawals or transfers from the
Master Servicer Collection Account, in the case of a demand by a Servicer, as
the applicable Servicer has designated for such transfer or withdrawal pursuant
to the applicable Servicing Agreement, or in the case of a demand by the
Securities Administrator as the Securities Administrator has demanded pursuant
hereto, or as the Master Servicer has determined to be appropriate in accordance
herewith, for the following purposes:
(i) to reimburse the Master Servicer or any Servicer for any
Monthly Advance of its own funds or any advance of such Servicer's own
funds, the right of the Master Servicer or a Servicer to reimbursement
pursuant to this subclause (i) being limited to amounts received on a
particular Mortgage Loan (including, for this purpose, the Repurchase
Price therefor, Insurance Proceeds and Liquidation Proceeds) which
represent late payments or recoveries of the principal of or interest
on such Mortgage Loan respecting which such Monthly Advance or advance
was made;
(ii) to reimburse the Master Servicer or any Servicer from
Insurance Proceeds or Liquidation Proceeds relating to a particular
Mortgage Loan for amounts expended by the Master Servicer or such
Servicer in good faith in connection with the restoration of the
related Mortgaged Property which was damaged by an Uninsured Cause or
in connection with the liquidation of such Mortgage Loan;
(iii) to reimburse the Master Servicer or any Servicer from
Insurance Proceeds relating to a particular Mortgage Loan for insured
expenses incurred with respect to such Mortgage Loan and to reimburse
the Master Servicer or such Servicer from Liquidation Proceeds from a
particular Mortgage Loan for Liquidation Expenses incurred with
respect to such Mortgage Loan;
(iv) to pay the Master Servicer or any Servicer, as appropriate,
from Liquidation Proceeds, (including Insurance Proceeds received in
connection with the liquidation of a Mortgage Loan) the amount which
it or such Servicer would have been entitled to receive under
subclause (ix) of this Subsection 4.03(a) as servicing compensation on
account of each defaulted scheduled payment on such Mortgage Loan if
paid in a timely manner by the related Mortgagor;
(v) to pay the Master Servicer or any Servicer from the
Repurchase Price for a Mortgage Loan, the amount which it or such
Servicer would have been entitled to receive under subclause (ix) of
this Subsection (a) as servicing compensation;
(vi) to reimburse the Master Servicer or any Servicer for
servicing related advances of funds, the right to reimbursement
pursuant to this subclause being limited to amounts received on the
related Mortgage Loan (including, for this purpose, the Repurchase
Price therefor, Insurance Proceeds and Liquidation Proceeds) which
represent late recoveries of the payments for which such servicing
advances were made;
(vii) to reimburse the Master Servicer or any Servicer for any
Monthly Advance or advance, after a Realized Loss has been allocated
with respect to the related Mortgage Loan if the Monthly Advance or
advance has not been reimbursed pursuant to clauses (i) and (vi);
(viii) to pay the Master Servicer its monthly Master Servicing
Fee and any investment income and other additional servicing
compensation payable pursuant to Section 3.14;
(ix) to reimburse the Master Servicer or the Securities
Administrator for any expenses recoverable by the Master Servicer or
the Securities Administrator pursuant to Sections 3.03, 7.04 and 9.05;
(x) to reimburse or pay any Servicer any such amounts as are due
thereto under the applicable Servicing Agreement and have not been
retained by or paid to the Servicer, to the extent provided in the
related Servicing Agreement;
(xi) to remove amounts deposited in error; and
(xii) to clear and terminate the Master Servicer Collection
Account pursuant to Section 10.01.
To the extent amounts are reimbursable pursuant to clauses (vii), (ix)
or (x) which are not to be paid from receipts on a specific Mortgage Loan, they
shall be allocated first to Principal Funds or Interest Funds, as applicable,
relating to the Loan Group (and Loan Subgroup) in which the Mortgage Loan giving
rise to the need for reimbursement was contained or, if not specifically
allocable to one Loan Group, then to Principal Funds or Interest Funds, as
applicable relating to both Loan Groups (and, if applicable, among the Loan
Subgroups in each Loan Group), PRO RATA, based upon the Scheduled Principal
Balance of the Mortgage Loans in each Loan Group (or Loan Subgroup).
(b) In addition, on or before each Distribution Account Deposit Date,
the Master Servicer shall deposit in the Distribution Account (or remit to the
Trustee for deposit therein) any Monthly Advances or payments of Compensating
Interest, to the extent required but not made by the related Servicer and
required to be made by the Master Servicer with respect to the Mortgage Loans.
(c) The Master Servicer shall keep and maintain separate accounting,
on a Mortgage Loan by Mortgage Loan basis, for the purpose of accounting for any
payments or reimbursements from the Master Servicer Collection Account pursuant
to subclauses (i) through (vii), inclusive, (ix) and (x) or with respect to any
such amounts which would have been covered by such subclauses had the amounts
not been retained by the Master Servicer without being deposited in the
Distribution Account under Section 4.02(b), and to allow the Securities
Administrator to calculate the amount of the Trustee Fee due the Trustee on the
related Distribution Date.
(d) No later than 3:00 p.m. New York time on each Distribution Account
Deposit Date, the Master Servicer will transfer all Interest Funds and Principal
Funds on deposit in the Master Servicer Collection Account net of the Master
Servicing Fee and any other amounts previously withdrawn pursuant to Subsection
4.03(a) with respect to the related Distribution Date to the Trustee for deposit
in the Distribution Account.
Section 4.04 DISTRIBUTION ACCOUNT. (a) The Trustee shall establish and
maintain in the name of the Trustee, for the benefit of the Trust and the
Certificateholders, the Distribution Account as a segregated trust account or
accounts, each of which shall be a non-interest bearing Eligible Account.
(b) All amounts deposited to the Distribution Account shall be held by
the Trustee in the name of the Trustee in trust for the benefit of the Trust and
the Certificateholders in accordance with the terms and provisions of this
Agreement.
(c) The Distribution Account shall constitute a trust account of the
Trust segregated on the books of the Trustee and held by the Trustee in trust in
its Corporate Trust Office, and the Distribution Account and the funds deposited
therein shall not be subject to, and shall be protected from, all claims, liens,
and encumbrances of any creditors or depositors of the Trustee or the Master
Servicer (whether made directly, or indirectly through a liquidator or receiver
of the Trustee or the Master Servicer). The amount at any time credited to the
Distribution Account shall be (i) fully insured by the FDIC to the maximum
coverage provided thereby or (ii) invested by the Trustee, in such Permitted
Investments as it shall select. All Permitted Investments shall mature or be
subject to redemption or withdrawal on or before, and shall be held until, the
immediately succeeding Distribution Date. All investment earnings or income on
amounts on deposit in the Distribution Account from time to time shall be for
the account of the Trustee, which shall be permitted to withdraw such amounts
from the Distribution Account. The risk of loss of moneys required to be
distributed to the Certificateholders resulting from such investments shall be
borne by the Trustee, which shall deposit the amount of any such loss in the
Distribution Account on the Distribution Date immediately following the date of
the investment to which such loss relates. With respect to the Distribution
Account and the funds deposited therein, the Trustee shall take such action as
may be necessary to ensure that the Trust and the Certificateholders shall be
entitled to the priorities afforded to such a trust account (in addition to a
claim against the estate of the Trustee) as provided by 12 U.S.C. ss. 92a(e),
and applicable regulations pursuant thereto, if applicable, or any applicable
comparable state statute applicable to state chartered banking corporations, if
applicable. The Trustee or its affiliates are 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.
(d) In order to comply with its duties under the USA PATRIOT Act of
2001, the Trustee shall obtain and verify certain information and documentation
from the other parties hereto, including, but not limited to, each such party's
name, address and other identifying information.
Section 4.05 PERMITTED WITHDRAWALS AND TRANSFERS FROM THE DISTRIBUTION
ACCOUNT. (a) The Trustee will, from time to time on demand of the Master
Servicer or the Securities Administrator, or for its own account as set forth
below, make or cause to be made such withdrawals or transfers from the
Distribution Account as the Master Servicer has designated for such transfer or
withdrawal pursuant to the Servicing Agreements or as the Securities
Administrator has instructed hereunder for the following purposes:
(i) to return to the Master Servicer or the applicable Servicer,
any amounts which should have been withdrawn from the Master Servicer
Collection Account pursuant to Section 4.03(a);
(ii) to pay the Trustee its monthly Trustee Fee;
(iii) to reimburse the Securities Administrator, the Trustee and
the Delaware Trustee for expenses, costs and liabilities incurred by
or reimbursable to them pursuant to Sections 7.04 or 9.05 (including
those related to the Custodian, to the extent not paid by ▇▇▇▇▇▇▇▇▇);
(iv) to make distributions of Retained Interest to the Retained
Interest Holder on each Distribution Date;
(v) to pay to the Trustee any investment income;
(vi) to remove amounts deposited in error; and
(vii) to clear and terminate the Distribution Account pursuant to
Section 10.01.
To the extent amounts are reimbursable pursuant to clause (iii) which
are not to be paid from receipts on a specific Mortgage Loan, they shall be
allocated first to Principal Funds or Interest Funds, as applicable, relating to
the Loan Group (and Loan Subgroup) in which the Mortgage Loan giving rise to the
need for reimbursement was contained or, if not specifically allocable to one
Loan Group, then to Principal Funds or Interest Funds, as applicable relating to
both Loan Groups (and, if applicable, among the Loan Subgroups in each Loan
Group), PRO RATA, based upon the Scheduled Principal Balance of the Mortgage
Loans in each Loan Group (or Loan Subgroup).
(b) On each Distribution Date, the Trustee shall distribute Interest
Funds and Principal Funds for such Distribution Date to the Holders of the
Certificates in accordance with Section 6.01.
ARTICLE V
Certificates
Section 5.01 CERTIFICATES. (a) The Depository, the Depositor and the
Trustee have entered into a Depository Agreement dated as of the Closing Date
(the "Depository Agreement"). Except for the Residual Certificates and the
Individual Certificates and as provided in Subsection 5.01(b), the Certificates
shall at all times remain registered in the name of the Depository or its
nominee and at all times: (i) registration of such Certificates may not be
transferred by the Trustee except to a successor to the Depository; (ii)
ownership and transfers of registration of such Certificates on the books of the
Depository shall be governed by applicable rules established by the Depository;
(iii) the Depository may collect its usual and customary fees, charges and
expenses from its Depository Participants; (iv) the Trustee shall deal with the
Depository (including its agents, employees, officers and directors) as absolute
owner of the Book-Entry Certificates and for all purposes whatsoever, including,
as representative of such Certificate Owners of the respective Class of
Certificates for purposes of exercising the rights of Certificateholders under
this Agreement, and requests and directions for and votes of such representative
shall not be deemed to be inconsistent if they are made with respect to
different Certificate Owners; (v) the Depository Participants shall have no
direct rights or recourse under this Agreement or with respect to any of the
Book-Entry Certificates held on their behalf by the Depository, except through
the Depository acting on their behalf, and (vi) the Trustee may rely and shall
be fully protected in conclusively relying upon information furnished by the
Depository with respect to its Depository Participants.
The Residual Certificates are Physical Certificates and the Class B-IO
Certificates are Individual Certificates.
All transfers by Certificate Owners of interests in such respective
Classes of Book-Entry Certificates shall be made in accordance with the
procedures established by the Depository Participant or brokerage firm
representing such Certificate Owners. Each Depository Participant shall only
transfer interests in 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.
(b) If (i)(A) the Depositor advises the Trustee in writing that the
Depository is no longer willing or able to properly discharge its
responsibilities as Depository and (B) the Trustee or the Depositor is unable to
locate a qualified successor within 30 days or (ii) after the occurrence and
continuation of an Event of Default, Certificate Owners of Book-Entry
Certificates having not less than 51% of the Fractional Undivided Interests
evidenced by any Class of Book-Entry Certificates advise the Trustee and the
Depository in writing through the Depository Participants that the continuation
of a book-entry system with respect to Certificates of such Class through the
Depository (or its successor) is no longer in the best interests of the
Certificate Owners of such Class, then the Trustee shall request that the
Depository notify all Certificate Owners of the occurrence of any such event and
of the availability of definitive, fully registered Certificates to Certificate
Owners requesting the same. Upon surrender to the Trustee of the Certificates by
the Depository, accompanied by registration instructions from the Depository for
registration, the Trustee shall issue the definitive Certificates. Neither the
Depositor nor the Trustee shall be liable for any delay in delivery of such
instructions and may conclusively rely on, and shall be fully protected in
relying on, such instructions.
(c) REMIC I will be evidenced by (x) the REMIC I Regular Interests
(designated below), which will be uncertificated and non-transferable and are
hereby designated as the "regular interests" in REMIC I and (y) the Class R-1
Certificate, which is hereby designated as the single "residual interest" in
REMIC I. Distributions shall be made to the REMIC I Regular Interests first, so
as to keep the Uncertificated Principal Balance of each REMIC I Regular Interest
beginning with the designation "C" equal to 0.1% of the aggregate Scheduled
Principal Balance of the Mortgage Loans in the related Loan Subgroup; second, to
each REMIC I Regular Interest beginning with the designation "X," so that the
Uncertificated Principal Balance of each such REMIC I Regular Interest is equal
to 0.1% of the excess of (x) the aggregate Scheduled Principal Balance of the
Mortgage Loans in the related Loan Subgroup over (y) the Current Principal
Amount of the related Class of Senior Certificates (except that if any such
excess is a larger number than in the preceding distribution period, the least
amount of principal shall be distributed to such other REMIC I Regular Interests
beginning with the designation "X" such that the REMIC I Subordinated Balance
Ratio is maintained); third, to each REMIC I Regular Interest beginning with the
designation "M," so that the Uncertificated Principal Balance of each such REMIC
I Regular Interest is equal to 1% of the related Class of Certificates; and
fourth, any remaining principal to the class Q REMIC I Regular Interest.
Realized Losses shall be applied after all distributions have been made on each
Distribution Date first, so as to keep the Uncertificated Principal Balance of
each REMIC I Regular Interest beginning with the designation "C" equal to 0.1%
of the aggregate Scheduled Principal Balance of the Mortgage Loans in the
related Loan Subgroup; second, to each REMIC I Regular Interest beginning with
the designation "X," so that the Uncertificated Principal Balance of each such
REMIC I Regular Interest is equal to 0.1% of the excess of (x) the aggregate
Scheduled Principal Balance of the Mortgage Loans in the related Loan Subgroup
over (y) the Current Principal Amount of the related Class of Senior
Certificates (except that if any such excess is a larger number than in the
preceding distribution period, the least amount of Realized Losses shall be
apportioned among such REMIC I Regular Interests such that the REMIC I
Subordinated Balance Ratio is maintained); third so as to keep the
Uncertificated Principal Balance of each REMIC I Regular Interest beginning with
the designation "M" equal to 1% of the related Class of Certificates; and
fourth, the remaining Realized Losses shall be allocated to the class Q REMIC I
Regular Interest.
The REMIC I Regular Interests and the Class R-1 Certificates will have
the following designations, initial Uncertificated Principal Balances,
pass-through rates, related Loan Subgroups and related Classes of Certificates:
INITIAL UNCERTIFICATED RELATED LOAN RELATED CERTIFICATE PASS-THROUGH
REMIC I INTEREST PRINCIPAL BALANCE SUBGROUP CLASS RATE
CI-1A $ 112,055.95 I-1 - (1)
CI-2A $ 251,268.65 I-2 - (2)
CII-1A $ 202,752.06 II-1 - (3)
CII-2A $ 327,799.84 II-2 - (4)
CII-3A $ 113,402.24 II-3 - (5)
CII-4A $ 99,429.16 II-4 - (6)
XI-1A $ 2,577.95 I-1 I-1A (7)
XI-2A $ 5,779.65 I-2 I-2A (7)
XII-1A $ 4,765.06 II-1 II-1A (7)
XII-2A $ 7,703.84 II-2 II-2A (7)
XII-3A $ 2,665.24 II-3 II-3A (7)
XII-4A $ 2,337.16 II-4 II-4A (7)
MI-1A $ 1,094,780.00 I-1 I-1A (7)
MI-2A $ 2,454,890.00 I-2 I-2A (7)
MII-1A $ 1,979,870.00 II-1 II-1A (7)
MII-2A $ 3,200,960.00 II-2 II-2A (7)
MII-3A $ 1,107,370.00 II-3 II-3A (7)
MII-4A $ 970,920.00 II-4 II-4A (7)
MI-M $ 83,575.00 I-M
MII-M $ 174,710.00 II-M
Q $1,094,737,977.42 N/A (7)
Class R-1 $ 50.00(8) N/A - N/A
------------------------
(1) The weighted average of the Net Rates of the Subgroup I-1 Mortgage Loans.
(2) The weighted average of the Net Rates of the Subgroup I-2 Mortgage Loans.
(3) The weighted average of the Net Rates of the Subgroup II-1 Mortgage Loans.
(4) The weighted average of the Net Rates of the Subgroup II-2 Mortgage Loans.
(5) The weighted average of the Net Rates of the Subgroup II-3 Mortgage Loans.
(6) The weighted average of the Net Rates of the Subgroup II-4 Mortgage Loans.
(7) The weighted average of the Net Rates of all of the Mortgage Loans.
(8) Certificated Principal Balance.
(d) REMIC II will be evidenced by (x) the Certificates (other than the
Class R-1 Certificate) (the "REMIC II Regular Interests"), which are hereby
designated as the "regular interests" in REMIC II and have the principal
balances and accrue interest at the Pass-Through Rates equal to those set forth
in this Subsection 5.01(d) and (y) the Class R-2 Certificate, which is hereby
designated as the single "residual interest" in REMIC II.
The Classes of the Certificates shall have the following designations,
initial principal amounts and Pass-Through Rates:
DESIGNATION INITIAL PRINCIPAL AMOUNT PASS-THROUGH RATE
I-1A $ 109,478,000.00 (1)(2)
I-2A $ 245,489,000.00 (1)(2)
II-1A $ 197,987,000.00 (1)
II-2A $ 320,096,000.00 (1)
II-3A $ 110,737,000.00 (1)
II-4A $ 97,092,000.00 (1)
I-M $ 8,357,500.00 (1)(3)
II-M $ 17,471,000.00 (3)
B-IO $ 389.20 (4)
$ 1,106,707,889,20 (5)
R-2 $ 50.00 N/A
---------------------
(1) The Pass-Through Rate for the related Class of Certificate (without the
right to receive any Basis Risk Shortfall Carry Forward Amount) as provided
in Article I.
(2) The Interest Rate Caps on the Class I-1A and Class I-2A Certificates are
equal to the pass-through rates on Lower-Tier class CI-1A and class CI-2A
REMIC I Regular Interests, respectively.
(3) The Interest Rate Cap on the Class I-M Certificates is equal to the
weighted average of the pass-through rates on the class XI-1A and class
XI-2A REMIC I Regular Interests, holding the pass-through rates on each of
those classes to a cap and floor equal to the weighted average Net Rate of
the Subgroup I-1 Loans and the weighted average of the Subgroup I-2 Loans,
respectively. The Pass-Through Rate on the Class II-M Certificates is equal
to the weighted average of the pass-through rates on the class XII-1A,
class XII-2A, class XII-3A and class XII-4A REMIC I Regular Interests,
holding the rates on each of those classes to a cap and floor equal to the
weighted average Net Rate of the Subgroup II-1 Loans, the weighted average
Net Rate of the Subgroup II-2 Loans, the weighted average Net Rate of the
Subgroup II-3 Loans and the weighted average Net Rate of the Subgroup II-4
Loans, respectively, minus 0.3770%.
(4) Interest on all of the REMIC I Regular Interests at a rate equal to the
weighted average pass-through rate of all REMIC I Regular Interests, less
interest on those REMIC 1 Regular Interests at rate equal to 100 x the
weighted average Net Rate of all of the REMIC I Regular Interests, holding
the rates on the class MI-1A, class MI-2A, class MII-1A, class MII-2A,
class MII-3A, class MII-4A, class MI-M and class MII-M REMIC I Regular
Interests to a cap and floor equal to the Pass-Through Rates on the Class
I-1A, Class I-2A, Class II-1A, Class II-2A, Class II-3A, Class II-4A, Class
I-M and Class II-M Certificates, respectively, and holding the rates on the
remaining REMIC I Regular Interests (i.e., the class CI-1A, class CI-2A,
class CII-1A, class CII-2A, class CII-3A, class CII-4A, class XI-1A, class
XI-2A class XII-1A, class XII-2A, class XII-3A, class XII-4A and class Q
REMIC I Regular Interests) to a cap and floor of 0.
(5) Initial Notional Amount.
In addition to the principal described above, the Class R-1 and Class
R-2 Certificates shall each be entitled to all distributions from their
respective REMICs, if any, that are not otherwise provided for herein.
The holders of the Class B-IO Certificates shall be treated for
federal income tax purposes as entering into a notional principal contract with
the Certificateholders entitled to receive Basis Risk Carry Forward Shortfall
Amounts. For all federal tax purposes, Basis Risk Carry Forward Shortfall
Amounts will be treated as transferred by a REMIC to the Class B-IO
Certificates, which then transfer such amounts to the Classes entitled thereto
pursuant to the notional principal contract. For federal tax return and
information reporting, such notional principal contract shall be assigned a
value of $100.
(e) Solely for purposes of Section 1.860G-1(a)(4)(iii) of the Treasury
regulations, the Distribution Date in the month following the month in which the
maturity date for the Mortgage Loan with the latest maturity date in the Trust
as of the Start-up Day occurs has been designated as the "latest possible
maturity date" for the REMIC I Regular Interests and the Certificates.
(f) With respect to each Distribution Date, each Class of Certificates
(other than the Residual Certificates) shall accrue interest during the related
Interest Accrual Period. With respect to each Distribution Date and each such
Class of Certificates, interest shall be calculated, on the basis of a 360-day
year comprised of twelve 30-day months, based upon the respective Pass-Through
Rate set forth, or determined as provided, above and the Current Principal
Amount of such Class applicable to such Distribution Date.
(g) The Certificates shall be substantially in the forms set forth in
Exhibits ▇-▇, ▇-▇, ▇-▇ and A-4, as applicable. On original issuance, the Trustee
shall sign, authenticate and shall deliver them at the direction of the
Depositor. Pending the preparation of definitive Certificates of any Class, the
Trustee may sign and authenticate temporary Certificates that are printed,
lithographed or typewritten, in authorized denominations for Certificates of
such Class, substantially of the tenor of the definitive Certificates in lieu of
which they are issued and with such appropriate insertions, omissions,
substitutions and other variations as the officers or authorized signatories
executing such Certificates may determine, as evidenced by their execution of
such Certificates. If temporary Certificates are issued, the Depositor will
cause definitive Certificates to be prepared without unreasonable delay. After
the preparation of definitive Certificates, the temporary Certificates shall be
exchangeable for definitive Certificates upon surrender of the temporary
Certificates at the office of the Trustee, without charge to the Holder. Upon
surrender for cancellation of any one or more temporary Certificates, the
Trustee shall sign and authenticate and deliver in exchange therefor a like
aggregate principal amount, in authorized denominations for such Class, of
definitive Certificates of the same Class. Until so exchanged, such temporary
Certificates shall in all respects be entitled to the same benefits as
definitive Certificates.
(h) Each Class of Book-Entry Certificates will be registered as a
single Certificate of such Class held by a nominee of the Depository or the DTC
Custodian, and beneficial interests will be held by investors through the
book-entry facilities of the Depository in minimum denominations of $25,000 and
in each case increments of $1,000 in excess thereof, except that, in each case,
one Certificate of each such Class may be issued in a different amount so that
the sum of the denominations of all outstanding Certificates of such Class shall
equal the Current Principal Amount of such Class on the Closing Date. On the
Closing Date, the Trustee shall execute and authenticate the Residual
Certificates. The Class B-IO Certificates shall be issued in certificated, fully
registered form in minimum denominations of $10,000,000 and increments of
$1,000,000 in excess thereof except that one Certificate may be issued in a
different amount so that the sum of the denominations of all Class B-IO
Certificates shall equal the Class B-IO Notional Amount on the Closing Date.
Each Class of Residual Certificates shall be issued in certificated
fully-registered form as a single Certificate in the denomination of $50. On the
Closing Date, the Trustee shall execute and authenticate (i) in the case of each
Class of Certificates other than the Residual Certificates, the Certificate in
the entire Current Principal Amount of the respective Class and (ii) the
Residual Certificates, each in the denomination of $50. The Certificates
referred to in clause (i) shall be delivered by the Depositor to the Depository
or, pursuant to the Depository's instructions, shall be delivered by the
Depositor on behalf of the Depository to and deposited with the DTC Custodian.
The Trustee shall sign the Certificates by facsimile or manual signature and
authenticate them by manual signature on behalf of the Trustee by one or more
authorized signatories, each of whom shall be Responsible Officers of the
Trustee or its agent. A Certificate bearing the manual and facsimile signatures
of individuals who were the authorized signatories of the Trustee or its agent
at the time of issuance shall bind the Trustee, notwithstanding that such
individuals or any of them have ceased to hold such positions prior to the
delivery of such Certificate.
(i) No Certificate shall be entitled to any benefit under this
Agreement, or be valid for any purpose, unless there appears on such Certificate
the manually executed authentication of the Trustee or its agent, 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 issued on the Closing Date shall be dated the Closing Date. All
Certificates issued thereafter shall be dated the date of their authentication.
(j) The Closing Date is hereby designated as the "startup" day of each
REMIC within the meaning of Section 860G(a)(9) of the Code.
(k) For federal income tax purposes, each REMIC shall have a tax year
that is a calendar year and shall report income on an accrual basis.
(l) The Trustee on behalf of the Trust shall cause each REMIC to
timely elect to be treated as a REMIC under Section 860D of the Code. Any
inconsistencies or ambiguities in this Agreement or in the administration of any
Trust established hereby shall be resolved in a manner that preserves the
validity of such elections.
(m) The applicable Securities Legend shall be placed on the applicable
Class or Classes of Certificates, whether upon original issuance or upon
issuance of any other Certificate of any such Class in exchange therefor or upon
transfer thereof.
Section 5.02 REGISTRATION OF TRANSFER AND EXCHANGE OF CERTIFICATES.
(a) The Trustee shall maintain at its Corporate Trust Office a Certificate
Register in which, subject 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.
(b) Subject to Subsection 5.01(a) and, in the case of any Individual
Certificate upon the satisfaction of the conditions set forth below, upon
surrender for registration of transfer of any Certificate at any office or
agency of the Trustee maintained for such purpose, the Trustee shall sign,
authenticate and shall deliver, in the name of the designated transferee or
transferees, a new Certificate of a like Class and aggregate Fractional
Undivided Interest, but bearing a different number.
(c) By acceptance of an Individual Certificate, whether upon original
issuance or subsequent transfer, each holder of such a Certificate acknowledges
the restrictions on the transfer of such Certificate set forth in the Securities
Legend and agrees that it will transfer such a Certificate only as provided
herein. In addition to the provisions of Subsection 5.02(h), the following
restrictions shall apply with respect to the transfer and registration of
transfer of an Individual Certificate:
(i) The Trustee shall register the transfer of an Individual
Certificate if the requested transfer is being made to a transferee
who has provided the Trustee with (x) a Rule 144A Certificate or (y)
comparable evidence as to its QIB status and evidence as to its
compliance with the applicable ERISA restrictions contained in the
Securities Legend.
(ii) The Trustee shall register the transfer of any Individual
Certificate if (x) the transferor has advised the Trustee in writing
that the Certificate is being transferred to an Institutional
Accredited Investor; and (y) prior to the transfer the transferee
furnishes to the Trustee an Investment Letter (and the Trustee shall
be fully protected in so doing), provided that, if based upon an
Opinion of Counsel to the effect that the delivery of (x) and (y)
above are not sufficient to confirm that the proposed transfer is
being made pursuant to an exemption from, or in a transaction not
subject to, the registration requirements of the Securities Act and
other applicable laws, the Trustee shall as a condition of the
registration of any such transfer require the transferor to furnish
such other certifications, legal opinions or other information prior
to registering the transfer of an Individual Certificate as shall be
set forth in such Opinion of Counsel.
(iii) The Trustee shall register the transfer of any Individual
Certificate without delivery of the documents required by sub-clauses
(i) or (ii) above if such transfer is being made by ▇▇▇▇▇▇▇▇▇ or by
any of its Affiliates, to ▇▇▇▇▇▇▇▇▇ or to another Affiliate of
▇▇▇▇▇▇▇▇▇.
(d) Reserved.
(e) Reserved.
(f) Reserved.
(g) The Securities Legend shall be placed on any Individual
Certificate issued in exchange for or upon transfer of another Individual
Certificate.
(h) Subject to the restrictions on transfer and exchange set forth in
this Section 5.02, the holder of any Individual Certificate may transfer or
exchange the same in whole or in part (in an initial certificate balance equal
to the minimum authorized denomination and integral amounts in excess thereof
set forth in Section 5.01(h) above by surrendering such Certificate at the
Corporate Trust Office, or at the office of any transfer agent, together with an
executed instrument of assignment and transfer satisfactory in form and
substance to the Trustee in the case of transfer and a written request for
exchange in the case of exchange. Following a proper request for transfer or
exchange, the Trustee shall, within five Business Days of such request made at
such Corporate Trust Office, sign, authenticate and deliver at such Corporate
Trust Office, to the transferee (in the case of transfer) or holder (in the case
of exchange) or send by first class mail at the risk of the transferee (in the
case of transfer) or holder (in the case of exchange) to such address as the
transferee or holder, as applicable, may request, an Individual Certificate or
Certificates, as the case may require, for a like aggregate Fractional Undivided
Interest and in such authorized denomination or denominations as may be
requested. The presentation for transfer or exchange of any Individual
Certificate shall not be valid unless made at the Corporate Trust Office by the
registered holder in person, or by a duly authorized attorney-in-fact.
(i) At the option of the Certificateholders, Individual Certificates
and Physical Certificates may be exchanged for other Certificates of authorized
denominations of a like Class and aggregate Fractional Undivided Interest, upon
surrender of the Individual Certificates and Physical Certificates to be
exchanged at any such office or agency; provided, however, that no Certificate
may be exchanged for new Certificates unless the original Fractional Undivided
Interest represented by each such new Certificate (i) is at least equal to the
minimum authorized denomination or (ii) is acceptable to the Depositor as
indicated to the Trustee in writing. Whenever any such Certificates are so
surrendered for exchange, the Trustee shall sign and authenticate and the
Trustee shall deliver the Certificates which the Certificateholder making the
exchange is entitled to receive.
(j) If the Trustee so requires, every Certificate presented or
surrendered for transfer or exchange shall be duly endorsed by, or be
accompanied by a written instrument of transfer, with a signature guarantee, in
form satisfactory to the Trustee, duly executed by the holder thereof or his or
her attorney duly authorized in writing.
(k) No service charge shall be made for any transfer or exchange of
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 Certificates.
(l) The Trustee shall cancel all Certificates surrendered for transfer
or exchange but shall retain such Certificates in accordance with its standard
retention policy or for such further time as is required by the record retention
requirements of the Securities Exchange Act of 1934, as amended, and thereafter
may destroy such Certificates.
Section 5.03 MUTILATED, DESTROYED, LOST OR STOLEN CERTIFICATES. (a) If
(i) 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 (ii) there is delivered to the Trustee such security or
indemnity as it may require to save it harmless, and (iii) the Trustee has not
received notice that such Certificate has been acquired by a third Person, the
Trustee shall sign, authenticate and deliver, in exchange for or in lieu of any
such mutilated, destroyed, lost or stolen Certificate, a new Certificate of like
tenor and Fractional Undivided Interest but in each case bearing a different
number. The mutilated, destroyed, lost or stolen Certificate shall thereupon be
canceled of record by the Trustee and shall be of no further effect and evidence
no rights.
(b) Upon 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 duplicate Certificate issued pursuant to this Section 5.03 shall constitute
complete and indefeasible evidence of ownership in the Trust, as if originally
issued, whether or not the lost, stolen or destroyed Certificate shall be found
at any time.
Section 5.04 PERSONS DEEMED OWNERS. Prior to due presentation of a
Certificate for registration of transfer, the Depositor, the Trustee and any
agent of 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 pursuant to Section 6.01 and for all other purposes
whatsoever. Neither the Depositor, the Trustee nor any agent of the Depositor or
the Trustee shall be affected by notice to the contrary. No Certificate shall be
deemed duly presented for a transfer effective on any Record Date unless the
Certificate to be transferred is presented no later than the close of business
on the third Business Day preceding such Record Date.
Section 5.05 TRANSFER RESTRICTIONS ON RESIDUAL CERTIFICATES. (a)
Residual Certificates, or interests therein, may not be transferred without the
prior express written consent of the Tax Matters Person and the Depositor. As a
prerequisite to such consent, the proposed transferee must provide the Tax
Matters Person, the Depositor and the Trustee with an affidavit that the
proposed transferee is a Permitted Transferee (and, unless the Tax Matters
Person and the Depositor consent to the transfer to a person who is not a U.S.
Person, an affidavit that it is a U.S. Person) as provided in Subsection
5.05(b).
(b) No transfer, sale or other disposition of a Residual Certificate
(including a beneficial interest therein) may be made unless, prior to the
transfer, sale or other disposition of a Residual Certificate, the proposed
transferee (including the initial purchasers thereof) delivers to the Tax
Matters Person, the Trustee and the Depositor an affidavit in the form attached
hereto as Exhibit E stating, among other things, that as of the date of such
transfer (i) such transferee is a Permitted Transferee and that (ii) such
transferee is not acquiring such Residual Certificate for the account of any
person who is not a Permitted Transferee. The Tax Matters Person shall not
consent to a transfer of a Residual Certificate if it has actual knowledge that
any statement made in the affidavit issued pursuant to the preceding sentence is
not true. Notwithstanding any transfer, sale or other disposition of a Residual
Certificate to any Person who is not a Permitted Transferee, such transfer, sale
or other disposition shall be deemed to be of no legal force or effect
whatsoever and such Person shall not be deemed to be a Holder of a Residual
Certificate for any purpose hereunder, including, but not limited to, the
receipt of distributions thereon. If any purported transfer shall be in
violation of the provisions of this Subsection 5.05(b), then the prior Holder
thereof shall, upon discovery that the transfer of such Residual Certificate was
not in fact permitted by this Subsection 5.05(b), be restored to all rights as a
Holder thereof retroactive to the date of the purported transfer. None of the
Trustee, the Tax Matters Person or the Depositor shall be under any liability to
any Person for any registration or transfer of a Residual Certificate that is
not permitted by this Subsection 5.05(b) or for making payments due on such
Residual Certificate to the purported Holder thereof or taking any other action
with respect to such purported Holder under the provisions of this Agreement so
long as the written affidavit referred to above was received with respect to
such transfer, and the Tax Matters Person, the Trustee and the Depositor, as
applicable, had no knowledge that it was untrue. The prior Holder shall be
entitled to recover from any purported Holder of a Residual Certificate that was
in fact not a Permitted Transferee under this Subsection 5.05(b) at the time it
became a Holder all payments made on such Residual Certificate. Each Holder of a
Residual Certificate, by acceptance thereof, shall be deemed for all purposes to
have consented to the provisions of this Subsection 5.05(b) and to any amendment
of this Agreement deemed necessary (whether as a result of new legislation or
otherwise) by counsel of the Tax Matters Person or the Depositor to ensure that
the Residual Certificates are not transferred to any Person who is not a
Permitted Transferee and that any transfer of such Residual Certificates will
not cause the imposition of a tax upon the Trust or cause any REMIC to fail to
qualify as a REMIC.
(c) Unless the Tax Matters Person shall have consented in writing
(which consent may be withheld in the Tax Matters Person's sole discretion), the
Residual Certificates (including a beneficial interest therein) may not be
purchased by or transferred to any person who is not a United States Person.
(d) By accepting a Residual Certificate, the purchaser thereof agrees
to be a Tax Matters Person, and appoints the Securities Administrator to act as
its agent with respect to all matters concerning the tax obligations of the
Trust.
Section 5.06 RESTRICTIONS ON TRANSFERABILITY OF PRIVATE CERTIFICATES.
(a) No offer, sale, transfer or other disposition (including pledge) of any
Private Certificate shall be made by any Holder thereof unless registered under
the Securities Act, or an exemption from the registration requirements of the
Securities Act and any applicable state securities or "Blue Sky" laws is
available and the prospective transferee of such Private Certificate (other than
a transfer by the Depositor to ▇▇▇▇▇▇▇▇▇ or any of its Affiliates, or from
▇▇▇▇▇▇▇▇▇ or any of its Affiliates to another Affiliate of ▇▇▇▇▇▇▇▇▇) signs and
delivers to the Trustee an Investment Letter, if the transferee is an
Institutional Accredited Investor, in the form set forth as Exhibit F-l hereto,
or a Rule 144A Certificate, if the transferee is a QIB, in the form set forth as
Exhibit F-2 hereto. In the case of a proposed transfer of any Private
Certificate to a transferee other than a QIB, the Trustee may require an Opinion
of Counsel that such transaction is exempt from the registration requirements of
the Securities Act. The cost of such opinion shall not be an expense of the
Trustee or the Trust.
(b) The Private Certificates shall each bear a Securities Legend.
Section 5.07 ERISA RESTRICTIONS. (a) Subject to the provisions of
subsection (b), no Residual Certificates or Private Certificates may be acquired
directly or indirectly by, or on behalf of, an employee benefit plan or other
retirement arrangement which is subject to Title I of ERISA and/or Section 4975
of the Code, unless (except in the case of a transfer by the Depositor to
▇▇▇▇▇▇▇▇▇ or any of its Affiliates, or by ▇▇▇▇▇▇▇▇▇ or any of its Affiliates to
another Affiliate of ▇▇▇▇▇▇▇▇▇, which shall be deemed to have so represented) in
the case of the Private Certificates, a representation or certification is
provided to the Trustee (upon which the Trustee is authorized to rely) to the
effect that the proposed transfer and/or holding of such a Certificate and the
servicing, management and operation of the Trust: (I) will not result in a
prohibited transaction under Section 406 of ERISA or Section 4975 of the Code
which is not covered under an individual or class prohibited transaction
exemption including but not limited to Department of Labor Prohibited
Transaction Exemption ("PTE") 84-14 (Class Exemption for Plan Asset Transactions
Determined by Independent Qualified Professional Asset Managers); PTE 91-38
(Class Exemption for Certain Transactions Involving Bank Collective Investment
Funds); PTE 90-1 (Class Exemption for Certain Transactions Involving Insurance
Company Pooled Separate Accounts), PTE 95-60 (Class Exemption for Certain
Transactions Involving Insurance Company General Accounts), and PTCE 96-23
(Class Exemption for Plan Asset Transactions Determined by In-House Asset
Managers and (II) will not subject the Depositor, the Securities Administrator,
the Master Servicer or the Trustee, the Delaware Trustee or any Servicer to any
obligation in addition to those undertaken in the Agreement.
Section 5.08 RULE 144A INFORMATION. For so long as any Certificates
are outstanding and are "restricted securities" within the meaning of Rule
144(a)(3) of the Securities Act, (1) the Depositor will provide or cause to be
provided to any holder of such Certificates and any prospective purchaser
thereof designated by such a holder, upon the request of such holder or
prospective purchaser, the information required to be provided to such holder or
prospective purchaser by Rule 144A(d)(4) under the Securities Act; and (2) the
Depositor shall update such information from time to time in order to prevent
such information from becoming false and misleading and will take such other
actions as are necessary to ensure that the safe harbor exemption from the
registration requirements of the Securities Act under Rule 144A is and will be
available for resales of such Certificates conducted in accordance with Rule
144A.
Section 5.09 OPTIONAL PURCHASE OF CERTIFICATES.
(a) All but not less than all of the Offered Certificates are subject
to purchase by TMI, at its option, on any Distribution Date on or after the
Optional Securities Purchase Date from the then Certificateholders thereof;
provided, however, that TMI may appoint a designee to purchase one or both of
the Residual Certificates. The purchase price for each Certificate (other than a
Residual Certificate) shall be equal to the sum of (i) the aggregate Current
Principal Amount of that Certificate, (ii) any accrued but unpaid Current
Interest thereon at the applicable Pass-Through Rate and (iii) any Interest
Carry Forward Amount with respect thereto for such Distribution Date. The
purchase price for each of the Class R-1 and R-2 Certificates shall be $1.00. In
order to exercise the Optional Securities Purchase Right, TMI must, no later
than the eighth Business Day prior to the applicable Distribution Date, deliver
to the Issuer, the Trustee and the Securities Administrator (with copies to the
Rating Agencies and the Master Servicer) written notice, in the form of Exhibit
K hereto, of its intent to purchase the Offered Certificates and of the
Distribution Date on which it intends to do so and the Securities Administrator
will verify in writing to TMI and the Trustee the cash amount required of TMI to
effect such purchase no later than the third Business Day prior to the
Distribution Date on which such purchase is scheduled to occur. The Trustee
shall furnish notice of the exercise of the Optional Securities Purchase Right
to the applicable Certificateholders in compliance with Section 5.09(c). On the
Distribution Date on which the Optional Securities Purchase Right will be
exercised, TMI shall deposit the appropriate amount in cash with the Trustee.
Such amount shall be deposited by the Trustee into a separate sub-account of the
Distribution Account (the "Purchase Account"). Such amounts shall be paid by the
Trustee to Holders of the applicable Certificates as provided in Section
5.09(d).
(b) In the case of an exercise of the Optional Securities Purchase
Right, TMI shall be solely responsible for the costs and expenses of the
Trustee, the Securities Administrator and the Master Servicer.
(c) Notice of exercise of the Optional Securities Purchase Right under
Section 5.09(a) shall be given by the Trustee by facsimile or by first-class
mail, postage prepaid, transmitted or mailed not less than five Business Days
prior to the applicable Distribution Date, to each Holder of a Class R-1 and
Class R-2 Certificate as of the close of business on the Record Date preceding
such Distribution Date and to each Holder of a Certificate (other than a
Residual Certificate) as of a date not more than one Business Day preceding the
mailing of such notice, at such Holder's address appearing in the Certificate
Register.
All such notices shall state:
(i) the Distribution Date upon which the Certificateholders will
receive payment in full on the applicable Certificates;
(ii) the amount the applicable Certificateholders will be paid,
separately stating amounts in respect of principal, Current Interest
and Interest Carry Forward Amounts;
(iii) that the Record Date otherwise applicable to such
Distribution Date is not applicable and that payments shall be made
only upon presentation and surrender of the respective Certificates
and the place where such Certificates are to be surrendered for
payment; and
(iv) that interest on the respective Certificates shall cease to
accrue for the benefit of the then Certificateholders on such
Distribution Date and no interest shall accrue on the price paid for
such Certificates.
The foregoing notice shall be given by the Trustee in the name and at
the expense of TMI. Failure to give notice of such purchase, or any defect
therein, to any Holder of any Certificate shall not impair or affect the
validity of the purchase of any other Certificate.
(d) The Certificates shall, following notice as required by Section
5.09(c), be purchased on the applicable Distribution Date by TMI at the price
specified in Section 5.09(a) from funds in the Purchase Account, and (unless TMI
shall default in the payment of such amount) no interest shall accrue on such
amount for any period after the date to which accrued interest is calculated for
purposes of calculating such amount.
(e) Subsequent to the purchase of the Certificates following exercise
of the Optional Securities Purchase Right, TMI shall be the sole Holder of the
Offered Certificates (other than the Residual Certificates) and it shall either
be the sole Holder of the Class R-1 and Class R-2 Certificates or may designate
a Person which meets the requirements of this Agreement to become the Holder
thereof. TMI may subsequently transfer some or all of the Certificates acquired
by it in accordance with the provisions hereof. All Certificates issued to the
Certificateholders prior to exercise of the Optional Securities Purchase Right
shall be deemed cancelled.
ARTICLE VI
Payments to Certificateholders
Section 6.01 Distributions on the Certificates.
(a) On the first Distribution Date only and from the amount deposited
by the Depositor in the Distribution Account on the Closing Date pursuant to
Section 2.01(a) hereof, to the Class R-1 and Class R-2 Certificates, pro rata,
in reduction of their respective Current Principal Amounts, until their
respective Current Principal Amounts have been reduced to zero.
(b) On each Distribution Date, an amount equal to the Interest Funds
and the Principal Funds for such Distribution Date shall be withdrawn by the
Trustee from the Distribution Account and distributed as directed in accordance
with the Remittance Report provided by the Securities Administrator for such
Distribution Date, in the manner set forth in clauses (i) through (vi) below:
(i) The Trustee shall apply Interest Funds for Loan Group I for such
Distribution Date as follows:
FIRST, concurrently, to the Class I-1A and Class I-2A
Certificates, the Current Interest and then any Interest Carry Forward Amount
for such Classes, PRO RATA based on the amount of Current Interest and any
Interest Carry Forward Amount, as applicable, due thereon;
SECOND, from remaining Interest Funds for Loan Group I, to the
Class I-M Certificates, the Current Interest for such Class;
THIRD, from remaining Interest Funds in respect of Loan Group I,
any Group I Loss Amount will be included in Principal Funds in respect of Loan
Group I (and for allocation purposes be treated as Principal Funds from the Loan
Subgroup which experienced the Realized Loss) and as part of the Group I
Principal Distribution Amount;
FOURTH, from remaining Interest Funds in respect of Loan Group I,
any Group II Crossed Loss Amount will be included in Principal Funds in respect
of Loan Group II (and for allocation purposes be treated as Principal Funds from
the Loan Subgroup which experienced the Realized Loss) and as part of the Group
II Principal Distribution Amount;
FIFTH, any Group I Excess Spread to the extent necessary to meet
a level of overcollateralization equal to the Specified Overcollateralization
Amount for Loan Group I will be the Group I Extra Principal Distribution Amount
and will be included as part of the Group I Principal Distribution Amount; and
SIXTH, any remaining Group I Excess Spread will be included in
Group I Excess Cashflow and applied as described under clause (b)(iii) below.
On any Distribution Date, any Net Interest Shortfalls with respect to
Loan Group I will be allocated as provided in the definition of Current
Interest. The Holders of the Group I Certificates will not be entitled to
reimbursement for any such Net Interest Shortfalls.
Notwithstanding the provisions of subclauses FIFTH and SIXTH of clause
(b)(i) above, on the first Distribution Date, all Group I Excess Spread will be
paid to the Holders of the Class B-IO Certificates.
(ii) The Trustee shall apply the Group I Principal Distribution Amount
for such Distribution Date as follows:
(A) for each Distribution Date (i) prior to the Stepdown Date for
Certificate Group I or (ii) on which a Trigger Event for Loan Group I is in
effect:
FIRST, concurrently to the Class I-1A and Class I-2A
Certificates, PRO RATA based on the amount of Principal Funds for such
Distribution Date from the Subgroup I-1 and Subgroup I-2 Mortgage Loans,
respectively, until the Current Principal Amount of each such Class is reduced
to zero; and
SECOND, to the Class I-M Certificates, any remaining Group I
Principal Distribution Amount until the Current Principal Amount thereof is
reduced to zero;
(B) For each Distribution Date on or after the Stepdown Date for
Certificate Group I, so long as a Trigger Event for Loan Group I is not in
effect:
FIRST, concurrently to the Class I-1A and Class I-2A
Certificates, the Group I Senior Principal Distribution Amount, PRO RATA based
on the amount of Principal Funds for such Distribution Date from the Subgroup
I-1 and Subgroup I-2 Mortgage Loans, respectively, until the Current Principal
Amount of each such Class is reduced to zero; and
SECOND, to the Class I-M Certificates, from any remaining Group I
Principal Distribution Amount, the Class I-M Principal Distribution Amount,
until the Current Principal Amount thereof is reduced to zero;
Notwithstanding the provisions of clause (b)(ii) above, if on any
Distribution Date the Current Principal Amount of a Class of Group I Senior
Certificates has been reduced to zero, the portion of the Group I Principal
Distribution Amount or the Group I Senior Principal Distribution Amount, as
applicable, otherwise allocable to such Class will be allocated to the remaining
Class of Group I Senior Certificates until its Current Principal Amount has been
reduced to zero.
(iii) The Trustee shall apply any Group I Excess Cashflow for such
Distribution Date as follows:
FIRST, any Group I Excess Cashflow, to the extent necessary
(after application of the Group II Principal Distribution Amount) to meet a
level of overcollateralization equal to the Specified Overcollateralization
Amount for Loan Group II will be distributed concurrently to the Class II-1A,
Class II-2A, Class II-3A and Class II-4A Certificates, PRO RATA based on the
amount of Principal Funds for such distribution date from the Subgroup II-1,
Subgroup II-2, Subgroup II-3 and Subgroup II-4 Mortgage Loans, respectively,
until the current principal amount of each such Class is reduced to zero;
provided that, if on any Distribution Date the Current Principal Amount of one
or more Classes of Group II Senior Certificates has been reduced to zero, the
pro rata portion otherwise allocable to such Class or Classes will be allocated
to the remaining Class or Classes of Group II Senior Certificates, PRO RATA
based upon the remaining Current Principal Amounts of such remaining Classes
until their Current Principal Amounts are reduced to zero;
SECOND, from any remaining Group I Excess Cashflow, to the Class
I-M Certificates, an amount equal to (a) any Interest Carry Forward Amount and
(b) any Unpaid Applied Realized Loss Amount, in that order, for that Class for
such Distribution Date;
THIRD, from any remaining Group I Excess Cashflow, concurrently
to the Class I-1A and Class I-2A Certificates, an amount equal to any Basis Risk
Shortfall Carry Forward Amount for such Classes for that Distribution Date, PRO
RATA based on the amount of any remaining Basis Risk Shortfall Carry Forward
Amount for each such Class;
FOURTH, from any remaining Group I Excess Cashflow, to the Class
I-M Certificates, an amount equal to any Basis Risk Shortfall Carry Forward
Amount for such Class for that Distribution Date;
FIFTH, from any remaining Group I Excess Cashflow, to the Class
II-M Certificates in an amount equal to the sum of (a) any Interest Carry
Forward Amount and (b) any unpaid Applied Realized Loss Amount remaining after
application of Group II Excess Cashflow pursuant to subclause SECOND of clause
(b)(vi) below, to be applied in the priority set forth in such subclause;
SIXTH, from any remaining Group I Excess Cashflow, to the Class
B-IO Certificates, an amount up to the Class B-IO Distribution Amount for such
Distribution Date; and
SEVENTH, any remaining amounts to each of the Class R-1
Certificates and the Class R-2 Certificates, based on the related REMIC in which
such amounts remain.
(iv) The Trustee shall apply Interest Funds for Loan Group II for such
Distribution Date as follows:
FIRST, concurrently, to the Class II-1A, Class II-2A, Class II-3A
and Class I-4A Certificates, the Current Interest and then any Interest Carry
Forward Amount for such classes, PRO RATA based on the amount of Current
Interest and any Interest Carry Forward Amount, as applicable, due thereon;
SECOND, from remaining Interest Funds for Loan Group II, to the
Class II-M Certificates, the Current Interest for such Class;
THIRD, from remaining Interest Funds in respect of Loan Group II,
any Group II Loss Amount will be included in Principal Funds in respect of Loan
Group II (and for allocation purposes be treated as Principal Funds from the
Loan Subgroup which experienced the Realized Loss) and as part of the Group II
Principal Distribution Amount;
FOURTH, from remaining Interest Funds in respect of Loan Group
II, any Group I Crossed Loss Amount will be included in Principal Funds in
respect of Loan Group I (and for allocation purposes be treated as Principal
Funds from the Loan Subgroup which experienced the Realized Loss) and as part of
the Group I Principal Distribution Amount;
FIFTH, any Group II Excess Spread to the extent necessary to meet
a level of overcollateralization equal to the Specified Overcollateralization
Amount for Loan Group II will be the Group II Extra Principal Distribution
Amount and will be included as part of the Group II Principal Distribution
Amount; and
SIXTH, any remaining Group II Excess Spread will be included in
Group II Excess Cashflow and applied as described under clause (b)(vi) below.
On any Distribution Date, any Net Interest Shortfalls with respect to
Loan Group II will be allocated as provided in the definition of Current
Interest. The Holders of the Group II Certificates will not be entitled to
reimbursement for any such Net Interest Shortfalls.
Notwithstanding the provisions of subclauses FIFTH and SIXTH of clause
(b)(iv) above, on the first Distribution Date, all Group II Excess Spread will
be paid to the Holders of the Class B-IO Certificates.
(v) The Trustee shall apply the Group II Principal Distribution Amount
for such Distribution Date as follows:
(A) for each Distribution Date (i) prior to the Stepdown Date
for Certificate Group II or (ii) on which a Trigger Event for Loan
Group II is in effect:
FIRST, concurrently to the Class II-1A, Class II-2A, Class II-3A
and Class II-4A Certificates, PRO RATA based on the amount of Principal Funds
for such distribution date from the Subgroup II-1, Subgroup II-2, Subgroup II-3
and Subgroup II-4 Mortgage Loans, respectively, until the Current Principal
Amount of each such Class is reduced to zero; and
SECOND, to the Class II-M Certificates, any remaining Group II
Principal Distribution Amount until the Current Principal Amount thereof is
reduced to zero;
(B) For each Distribution Date on or after the Stepdown Date
for Certificate Group II, so long as a Trigger Event for Loan Group II
is not in effect:
FIRST, concurrently to the Class II-1A, Class II-2A, Class II-3A
and Class II-4A Certificates, the Group II Senior Principal Distribution Amount,
PRO RATA based on the amount of Principal Funds for such Distribution Date from
the Subgroup II-1, Subgroup II-2, Subgroup II-3 and Subgroup II-4 Mortgage
Loans, respectively, until the Current Principal Amount of each such Class is
reduced to zero; and
SECOND, to the Class II-M Certificates, from any remaining Group
II Principal Distribution Amount, the Class II-M Principal Distribution Amount,
until the Current Principal Amount thereof is reduced to zero;
Notwithstanding the provisions of clause (b)(v) above, if on any
Distribution Date the Current Principal Amount of one or more Classes of Group
II Senior Certificates has been reduced to zero, the portion of the Group II
Principal Distribution Amount or the Group II Senior Principal Distribution
Amount, as applicable, otherwise allocable to such Class or Classes will be
allocated to the remaining Class or Classes of Group II Senior Certificates PRO
RATA based upon the remaining Current Principal Amounts of such remaining
Classes until their Current Principal Amounts have been reduced to zero.
(vi) The Trustee shall apply any Group II Excess Cashflow for such
Distribution Date as follows:
FIRST, any Group II Excess Cashflow, to the extent necessary
(after application of the Group I Principal Distribution Amount) to meet a level
of overcollateralization equal to the Specified Overcollateralization Amount for
Loan Group I will be distributed concurrently to the Class I-1A and Class I-2A
Certificates PRO RATA based on the amount of Principal Funds for such
Distribution Date from the Subgroup I-1 and Subgroup II-2 Mortgage Loans,
respectively, until the current principal amount of each such Class is reduced
to zero; provided that, if on any Distribution Date the Current Principal Amount
of a Class of Group I Senior Certificates has been reduced to zero, the pro rata
portion otherwise allocable to such Class will be allocated to the remaining
Class of Group I Senior Certificates until its Current Principal Amount has been
reduced to zero;
SECOND, from any remaining Group II Excess Cashflow, to the Class
II-M Certificates, an amount equal to (a) any Interest Carry Forward Amount and
(b) any Unpaid Applied Realized Loss Amount, in that order, for such Class for
that Distribution Date;
THIRD, from any remaining Group II Excess Cashflow, to the Class
I-M Certificates and the Group I Senior Certificates, an amount equal to the sum
of (a) any Interest Carry Forward Amount and (b) any unpaid Applied Realized
Loss Amount for the Class I-M Certificates, and (c) any Basis Risk Shortfall
Carry Forward Amount for the Group I Senior Certificates and the Class I-M
Certificates remaining after application of Group II Excess Cashflow pursuant to
subclauses SECOND through FOURTH of clause (b)(iii) above to be applied among
the Group I Senior Certificates and the Class I-M Certificates in the order
(including pro rata allocation) set forth in such subclauses;
FOURTH, from any remaining Group II Excess Cashflow, to the Class
B-IO Certificates, an amount up to the Class B-IO Distribution Amount for such
Distribution Date; and
FIFTH, any remaining amounts to each of the Class R-1
Certificates and the Class R-2 Certificates, based on the related REMIC in which
such amounts remain.
(c) No Current Interest will be payable with respect to any Class of
Certificates after the Distribution Date on which the Current Principal Amount
of such Certificate has been reduced to zero.
(d) The expenses and fees of the Trust shall be paid by each of the
REMICs, to the extent that such expenses relate to the assets of each of such
respective REMICs, and all other expenses and fees of the Trust shall be paid
pro rata by both of the REMICs.
Section 6.02 ALLOCATION OF LOSSES. (a) Any Realized Losses with
respect to the Mortgage Loans in a Loan Group shall be applied on each
Distribution Date after the distributions provided for in Section 6.01 in
reduction of the Current Principal Amount of the Class of Subordinate
Certificates of the related Certificate Group as provided in the definition of
Applied Realized Loss Amount.
(b) Any amounts distributed to a Class of Subordinate Certificates in
respect of any Unpaid Applied Realized Loss Amount will not be applied to reduce
the Current Principal Amount of such Class.
(c) The Current Principal Amount of a Class of Subordinate
Certificates that has been reduced by the allocation of an Applied Realized Loss
will be increased, on any Distribution Date, by the amount of any Subsequent
Recoveries received during the related Prepayment Period with respect to the
related Loan Group, but not in excess of the Unpaid Applied Realized Loss Amount
for such Class immediately prior to such Distribution Date.
Section 6.03 PAYMENTS. (a) On each Distribution Date, other than the
final Distribution Date, the Trustee shall distribute to each Certificateholder
of record on the directly preceding Record Date the Certificateholder's pro rata
share of its Class (based on the aggregate Fractional Undivided Interest
represented by such Holder's Certificates) of all amounts required to be
distributed on such Distribution Date to such Class, based on information
provided to the Securities Administrator by the Master Servicer. The Securities
Administrator shall calculate the amount to be distributed to each Class and,
based on such amounts, the Securities Administrator shall determine the amount
to be distributed to each Certificateholder. All of the Securities
Administrator's calculations of payments shall be based solely on information
provided to the Securities Administrator by the Master Servicer. The Securities
Administrator shall not be required to confirm, verify or recompute any such
information but shall be entitled to rely conclusively on such information.
(b) Payment of the above amounts to each Certificateholder shall be
made (i) by check mailed to each Certificateholder entitled thereto at the
address appearing in the Certificate Register or (ii) upon receipt by the
Trustee on or before the fifth Business Day preceding the Record Date of written
instructions from a Certificateholder by wire transfer to a United States dollar
account maintained by the payee at any United States depository institution with
appropriate facilities for receiving such a wire transfer; provided, however,
that the final payment in respect of each Class of Certificates will be made
only upon presentation and surrender of such respective Certificates at the
office or agency of the Trustee specified in the notice to Certificateholders of
such final payment. Notwithstanding the foregoing, so long as a Certificate
shall be a Book-Entry Certificate, distributions shall be made to the Depository
by wire transfer in immediately available funds.
Section 6.04 STATEMENTS TO THE TRUSTEE, THE CERTIFICATEHOLDERS AND
OTHERS. (a) On or before 5:00 p.m. Central time on the third Business Day
immediately preceding each Distribution Date (or such other date as may be
agreed to by the Securities Administrator and the Master Servicer), the Master
Servicer shall deliver to the Securities Administrator with respect to all
Mortgage Loans, a report in the form of a computer readable magnetic tape (or by
such other means as the Master Servicer and the Securities Administrator may
agree from time to time) containing such data and information, as agreed to by
the Master Servicer and the Securities Administrator so as to permit the
Securities Administrator to prepare the monthly Remittance Report (as defined
below). The Securities Administrator shall deliver a Remittance Report to the
Trustee on or before 5:00 p.m. Eastern time on the Business Day immediately
preceding each Distribution Date. The Securities Administrator shall make
available to the other parties hereto and each Certificateholder on the
Securities Administrator's internet website as set forth below, a report (the
"Remittance Report") containing the following information, expressed with
respect to clauses (i) through (vii) in the aggregate and as a Fractional
Undivided Interest representing, in the case of a Class of Senior Certificates
or Subordinate Certificates, an initial Current Principal Amount of $25,000, in
the case of the Class B-IO Certificates, an initial Class B-IO Notional Amount
of $10,000,000, or in the case of each Class of Residual Certificates, an
initial Current Principal Amount of $50:
(i) the Current Principal Amount or Class B-IO Notional Amount of
each Class of Certificates immediately prior to such Distribution
Date;
(ii) the amount of the related distribution to each Class
allocable to principal, separately identifying (A) the aggregate
amount of any Principal Prepayments included therein, (B) the
aggregate of all Scheduled Payments of principal included therein, (C)
the principal portion of all Net Liquidation Proceeds included
therein, (D) the amount of any Subsequent Recoveries included therein
and (E) the Group I and Group II Extra Principal Distribution Amount
(if any);
(iii) the amount of such distribution to each Class allocable to
interest;
(iv) the Interest Carry Forward Amounts and any Unpaid Applied
Realized Loss Amounts, if applicable, for each Class of Certificates
(other than the Class B-IO Certificates and the Residual
Certificates), if any;
(v) the Current Principal Amount or Class B-IO Notional Amount,
as applicable, of each Class after giving effect (i) to all
distributions allocable to principal on such Distribution Date in
reduction of Current Principal Amount, (ii), if applicable, the
allocation of any Applied Realized Loss Amounts in reduction of
Current Principal Amount for such Distribution Date and (iii) if
applicable, the allocation of Subsequent Recoveries to increase
Current Principal Amount for such Distribution Date;
(vi) the cumulative amount of Applied Realized Loss Amounts to
date and the Unpaid Applied Realized Loss Amounts for each Class of
Subordinate Certificates after giving effect to the distributions and
allocations of Applied Realized Loss Amounts on such Distribution
Date;
(vii) the Net Interest Shortfall allocated to each Class of
Certificates in reduction of Current Interest or, in the case of the
Class B-IO Certificates and each class of Class R Certificates,
distributions of Group I or Group II Excess Cashflow otherwise
distributable to each such class;
(viii) the Pass-Through Rate for each Class of Certificates with
respect to the current Interest Accrual Period, and, if applicable, in
the case of a Class of Group I Certificates, whether such Pass-Through
Rate was limited by the Interest Rate Cap or the cap of 10.750% per
annum;
(ix) the amount of any Group I or Group II Excess Cashflow
Amount;
(x) the aggregate of the Scheduled Principal Balances of (i) the
hybrid Mortgage Loans, in their fixed rate period, stating separately
the aggregate Scheduled Principal Balance of each of the Three-Year
Hybrid Mortgage Loans, the Five-Year Hybrid Mortgage Loans, the
Seven-Year Hybrid Mortgage Loans and the Ten-Year Hybrid Mortgage
Loans, (ii) the Converted Mortgage Loans and the Modified Mortgage
Loans, (iii) the adjustable rate Mortgage Loans (other than any such
Mortgage Loans that have become Converted Mortgage Loans or Modified
Mortgage Loans) and (iv) all of the Mortgage Loans in each Loan
Subgroup and in each Loan Group as of the last day of the immediately
preceding Due Period;
(xi) the related amount of the Master Servicing Fees paid to or
retained by the Master Servicer and the Servicing Fees paid to or
retained by each Servicer for the related Due Period;
(xii) the amount of any Monthly Advances, Compensating Interest
Payments and outstanding unreimbursed advances by the Master Servicer
or the Servicers included in such distribution with respect to the
Mortgage Loans in each Loan Subgroup;
(xiii) the amount of Scheduled Principal, Principal Prepayments,
Net Liquidation Proceeds (including but separately identifying the
principal amount of principal prepayments, Insurance Proceeds, the
purchase price in connection with the purchase of Mortgage Loans, cash
deposits in connection with substitutions of Mortgage Loans),
Subsequent Recoveries and the number and principal balance of Mortgage
Loans purchased or substituted for during the immediately preceding
Prepayment Period or Due Period, as applicable, and cumulatively since
the Cut-off Date with respect to each Loan Subgroup;
(xiv) the number of Mortgage Loans (excluding REO Property)
remaining in each Loan Subgroup as of the end of the related
Prepayment Period;
(xv) information regarding any Mortgage Loan delinquencies as of
the end of the related Prepayment Period, including the aggregate
number and aggregate Outstanding Principal Balance of Mortgage Loans
in each Loan Subgroup (a) delinquent 30 to 59 days on a contractual
basis, (b) delinquent 60 to 89 days on a contractual basis, and (c)
delinquent 90 or more days on a contractual basis, in each case as of
the close of business on the last Business Day of the immediately
preceding month;
(xvi) the number of Mortgage Loans in each Loan Subgroup in the
foreclosure process as of the end of the related Due Period and the
aggregate Outstanding Principal Balance of such Mortgage Loans;
(xvii) the number and aggregate Outstanding Principal Balance of
all Mortgage Loans in each Loan Subgroup as to which the Mortgaged
Property was REO Property as of the end of the related Due Period;
(xviii) the three month rolling average of the aggregate
Scheduled Principal Balance of Mortgage Loans in each Loan Group that
are 60 or more days delinquent or are in bankruptcy or foreclosure or
are REO Properties, as a percentage of the aggregate Scheduled
Principal Balance of the Mortgage Loans as of the last day of the
related Due Period;
(xix) the aggregate amount of Realized Losses with respect to
each Loan Group (i) during the related Prepayment Period and
cumulatively since the Cut-off Date, including the amount and source
(separately identified) of any distribution in respect thereof
included in such distribution and (ii) since the Closing Date, as a
percentage of the aggregate Scheduled Principal Balance of the
Mortgage Loans of the respective Loan Group on the Closing Date; and
(xx) whether a Trigger Event exists with respect to each Loan
Group.
The information set forth above shall be calculated or reported, as
the case may be, by the Securities Administrator, based solely on, and to the
extent of, information provided to the Securities Administrator by the Master
Servicer. The Securities Administrator may conclusively rely on such information
and shall not be required to confirm, verify or recalculate any such
information.
The Securities Administrator may make available each month, to any
interested party , the monthly statement to Certificateholders via the
Securities Administrator's website initially located at "▇▇▇.▇▇▇▇▇▇▇.▇▇▇."
Assistance in using the website can be obtained by calling the Securities
Administrator's customer service desk at (▇▇▇) ▇▇▇-▇▇▇▇. Parties that are unable
to use the above distribution option are entitled to have a paper copy mailed to
them via first class mail by calling the customer service desk and indicating
such. The Securities Administrator shall have the right to change the way such
reports are distributed in order to make such distribution more convenient
and/or more accessible to the parties, and the Securities Administrator shall
provide timely and adequate notification to all parties regarding any such
change.
(b) By April 30 of each year beginning in 2005, the Trustee will
furnish such report to each Holder of the Certificates of record at any time
during the prior calendar year as to the aggregate of amounts reported pursuant
to subclauses (a)(ii), (a)(iii) and (a)(iv) above with respect to the
Certificates, plus information with respect to the amount of servicing
compensation (which information shall be provided on a timely basis to the
Trustee by the Securities Administrator) and such other customary information as
the Securities Administrator may determine and advises the Trustee to be
necessary and/or to be required by the Internal Revenue Service or by a federal
or state law or rules or regulations to enable such Holders to prepare their tax
returns for such calendar year. Such obligations shall be deemed to have been
satisfied to the extent that substantially comparable information shall be
provided by the Securities Administrator or the Trustee pursuant to the
requirements of the Code.
Section 6.05 MONTHLY ADVANCES. If the Scheduled Payment on a Mortgage
Loan that was due on a related Due Date and is delinquent, other than as a
result of application of the Relief Act, and for which the related Servicer was
required to make an advance pursuant to the related Servicing Agreement exceeds
the amount deposited in the Master Servicer Collection Account which will be
used for an advance with respect to such Mortgage Loan, the Master Servicer will
deposit in the Master Servicer Collection Account not later than the
Distribution Account Deposit Date immediately preceding each Distribution Date
an amount equal to such deficiency, net of the Servicing Fee and the Master
Servicing Fee, for such Mortgage Loan except to the extent the Master Servicer
determines any such advance to be nonrecoverable from Liquidation Proceeds,
Insurance Proceeds or future payments on the Mortgage Loan for which such
Monthly Advance was made. Subject to the foregoing, the Master Servicer shall
continue to make such advances through the date that the related Servicer is
required to do so under its Servicing Agreement. If applicable, on the
Distribution Account Deposit Date, the Master Servicer shall present an
Officer's Certificate to the Trustee (i) stating that the Master Servicer elects
not to make a Monthly Advance in a stated amount and (ii) detailing the reason
it deems the advance to be nonrecoverable.
Section 6.06 RESERVED.
Section 6.07 COMPENSATING INTEREST PAYMENTS. The Master Servicer shall
deposit into the Master Servicer Collection Account no later than the
Distribution Account Deposit Date, the excess of Compensating Interest Payments
required to be paid by the Servicers over amounts actually paid by such
Servicers on their respective Servicer Remittance Dates, in an amount not to
exceed the aggregate Master Servicing Fee payable in respect of such
Distribution Date. The amount of the Master Servicing Fee payable to the Master
Servicer in respect of any Distribution Date shall be reduced (but not below
zero) by the amount of any Compensating Interest Payment made by the Master
Servicer for such Distribution Date, but only to the extent that Interest
Shortfalls relating to such Distribution Date are required to be paid but not
actually paid by the Servicers on the applicable Servicer Remittance Date. Such
amount shall not be treated as an Advance and shall not be reimbursable to the
Master Servicer.
ARTICLE VII
The Master Servicer
Section 7.01 LIABILITIES OF THE MASTER SERVICER. The Master Servicer
shall be liable in accordance herewith only to the extent of the obligations
specifically imposed upon and undertaken by it herein.
Section 7.02 MERGER OR CONSOLIDATION OF THE MASTER SERVICER.
(a) The Master Servicer will keep in full force and effect its
existence, rights and franchises as a national banking association under the
laws of the United States, and will obtain and preserve its qualification to do
business as a foreign corporation in each jurisdiction in which such
qualification is or shall be necessary to protect the validity and
enforceability of this Agreement, the Certificates or any of the Mortgage Loans
and to perform its duties under this Agreement.
(b) Any Person into which the Master Servicer may be merged or
consolidated, or any corporation resulting from any merger or consolidation to
which the Master Servicer shall be a party, or any Person succeeding to the
business of the Master Servicer, shall be the successor of the Master Servicer
hereunder, 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.
Section 7.03 INDEMNIFICATION OF THE TRUSTEE, THE DELAWARE TRUSTEE, THE
DEPOSITOR, THE MASTER SERVICER AND THE SECURITIES ADMINISTRATOR. (a) The Master
Servicer agrees to indemnify the Indemnified Persons for, and to hold them
harmless against, any loss, liability or expense (except as otherwise provided
herein with respect to expenses) (including reasonable legal fees and
disbursements of counsel) incurred on their part that may be sustained in
connection with, arising out of, or relating to this Agreement or the
Certificates (i) related to the Master Servicer's failure to perform its duties
in compliance with this Agreement (except as any such loss, liability or expense
shall be otherwise reimbursable pursuant to this Agreement) or (ii) incurred by
reason of the Master Servicer's willful misfeasance, bad faith or gross
negligence in the performance of duties hereunder or by reason of reckless
disregard of obligations and duties hereunder, provided, in each case, that with
respect to any such claim or legal action (or pending or threatened claim or
legal action), the Trustee shall have given the Master Servicer and the
Depositor written notice thereof promptly after the Trustee shall have with
respect to such claim or legal action knowledge thereof. The Trustee's failure
to give such notice shall not affect the Indemnified Person's right to
indemnification hereunder. This indemnity shall survive the resignation or
removal of the Trustee, Master Servicer or the Securities Administrator and the
termination of this Agreement.
(b) The Trust will indemnify any Indemnified Person for any loss,
liability or expense of any Indemnified Person not otherwise indemnified by the
Master Servicer that is referred to in Subsection (a) above.
(c) The Securities Administrator agrees to indemnify the Indemnified
Persons (other than the Securities Administrator) for, and to hold them harmless
against, any loss, liability or expense (except as otherwise provided herein
with respect to expenses) (including reasonable legal fees and disbursements of
counsel) incurred on their part (i) in connection with, arising out of, or
relating to the Securities Administrator's failure to file a Form 10-K in
accordance with Section 3.18 (except as any such loss, liability or expense
shall be otherwise reimbursable pursuant to this Agreement), (ii) by reason of
the Securities Administrator's willful misfeasance, bad faith or gross
negligence in the performance of its obligations pursuant to Section 3.18 or
(iii) by reason of the Securities Administrator's reckless disregard of such
obligations pursuant to Section 3.18, provided, in each case, that with respect
to any such claim or legal action (or pending or threatened claim or legal
action), the Trustee shall have given the Securities Administrator written
notice thereof promptly after the Trustee shall have with respect to such claim
or legal action knowledge thereof. The Trustee's failure to give such notice
shall not affect the Indemnified Person's right to indemnification hereunder.
This indemnity shall survive the resignation or removal of the Trustee, Master
Servicer or the Securities Administrator and the termination of this Agreement.
Section 7.04 LIMITATIONS ON LIABILITY OF THE MASTER SERVICER AND
OTHERS. Subject to the obligation of the Master Servicer to indemnify the
Indemnified Persons pursuant to Section 7.03:
(a) Neither the Master Servicer nor any of the directors, officers,
employees or agents of the Master Servicer shall be under any liability to the
Indemnified Persons, the Trust or the Certificateholders for taking any action
or for refraining from taking any action in good faith pursuant to this
Agreement, or for errors in judgment; provided, however, that this provision
shall not protect the Master Servicer or any such Person against any breach of
warranties or representations made herein or any liability which would otherwise
be imposed by reason of such Person's willful misfeasance, bad faith or gross
negligence in the performance of duties or by reason of reckless disregard of
obligations and duties hereunder.
(b) The Master Servicer and any director, officer, employee or agent
of the Master 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.
(c) The Master Servicer, the Delaware Trustee, the Trustee, the
Custodian (including for such purpose, the Trustee acting in its capacity as
Custodian) and any director, officer, employee or agent of the Master Servicer,
the Delaware Trustee, the Trustee or the Custodian shall be indemnified by the
Trust and held harmless thereby against any loss, liability or expense (except
as otherwise provided herein with respect to expenses) (including reasonable
legal fees and disbursements of counsel) incurred on their part that may be
sustained in connection with, arising out of, or relating to, this Agreement,
the Certificates or any Servicing Agreement or the transactions contemplated
hereby or thereby (except to the extent that the Master Servicer is indemnified
by the Servicer thereunder), other than (i) any such loss, liability or expense
related to the Master Servicer's or the Custodian's, as applicable, failure to
perform its duties in compliance with this Agreement or, if applicable, to the
Custodian's failure to perform its duties under the Custodial Agreement,
respectively, or (ii) any such loss, liability or expense incurred by reason of
the Master Servicer's, the Delaware Trustee's or the Custodian's willful
misfeasance, bad faith or gross negligence in the performance of duties
hereunder or under a Custodial Agreement, if applicable, or by reason of
reckless disregard of obligations and duties hereunder or under a Custodial
Agreement, if applicable.
(d) The Master Servicer shall not be under any obligation to appear
in, prosecute or defend any legal action that is not incidental to its duties
under this Agreement and that in its opinion may involve it in any expense or
liability; provided, however, the Master Servicer may in its discretion, with
the consent of the Trustee (which consent shall not be unreasonably withheld),
undertake any such action which it may deem necessary or desirable with respect
to this Agreement and the rights and duties of the parties hereto and the
interests of the Trust 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, and the Master Servicer
shall be entitled to be reimbursed therefor out of the Master Servicer
Collection Account as provided by Section 4.03. Nothing in this Subsection
7.04(d) shall affect the Master Servicer's obligation to supervise, or to take
such actions as are necessary to ensure, the servicing and administration of the
Mortgage Loans pursuant to Subsection 3.01(a).
(e) In taking or recommending any course of action pursuant to this
Agreement, unless specifically required to do so pursuant to this Agreement, the
Master Servicer shall not be required to investigate or make recommendations
concerning potential liabilities which the Trust might incur as a result of such
course of action by reason of the condition of the Mortgaged Properties but
shall give notice to the Trustee if it has notice of such potential liabilities.
(f) The Master Servicer shall not be liable for any acts or omissions
of any Servicer, except as otherwise expressly provided herein.
Section 7.05 MASTER SERVICER NOT TO RESIGN. Except as provided in
Section 7.07, the Master Servicer shall not resign from the obligations and
duties hereby imposed on it except upon a determination that any such duties
hereunder are no longer permissible under applicable law and such
impermissibility cannot be cured. Any such determination permitting the
resignation of the Master Servicer shall be evidenced by an Opinion of
Independent Counsel to such effect delivered to the Trustee. No such resignation
by the Master Servicer shall become effective until the Trustee or a successor
to the Master Servicer reasonably satisfactory to the Trustee shall have assumed
the responsibilities and obligations of the Master Servicer in accordance with
Section 8.02 hereof. The Trustee shall notify each Rating Agency of the
resignation of the Master Servicer.
Section 7.06 SUCCESSOR MASTER SERVICER. In connection with the
appointment of any successor master servicer or the assumption of the duties of
the Master Servicer, the Trustee may make such arrangements for the compensation
of such successor master servicer out of payments on the Mortgage Loans as the
Trustee and such successor master servicer shall agree. If the successor master
servicer does not agree that the proposed compensation is fair, such successor
master servicer shall obtain two quotations of market compensation from third
parties actively engaged in the servicing of single-family mortgage loans;
provided, however, that ▇▇▇▇▇▇▇▇▇, as a Servicer of a substantial portion of the
Mortgage Loans, shall have the right, but not the obligation, to be appointed
successor master servicer in the event that the Trustee, in its sole discretion,
decides not to assume the duties of the Master Servicer itself; and provided,
further, that each Rating Agency shall confirm in writing that any appointment
of a successor Master Servicer (other than the Trustee) will not result in a
downgrade in the then current rating of any Class of Certificates.
Section 7.07 SALE AND ASSIGNMENT OF MASTER SERVICING. The Master
Servicer may sell and assign its rights and delegate its duties and obligations
in their entirety as Master Servicer under this Agreement, with the written
consent of ▇▇▇▇▇▇▇▇▇ in its capacity as a Servicer of a substantial portion of
the Mortgage Loans, to be given in its sole discretion, and provided further
that: (i) the purchaser or transferee accepting such assignment and delegation
(a) shall be a Person which shall be qualified to service mortgage loans for
▇▇▇▇▇▇ ▇▇▇ or ▇▇▇▇▇▇▇ Mac; (b) shall have a net worth of not less than
$10,000,000 (unless otherwise approved by each Rating Agency pursuant to clause
(ii) below); (c) shall be reasonably satisfactory to ▇▇▇▇▇▇▇▇▇ and the Trustee
(as evidenced in writing signed by ▇▇▇▇▇▇▇▇▇ and the Trustee); and (d) shall
execute and deliver to the Trustee an agreement, in form and substance
reasonably satisfactory to the Trustee, which contains an assumption by such
Person of the due and punctual performance and observance of each covenant and
condition to be performed or observed by it as master servicer under this
Agreement, any custodial agreement from and after the effective date of such
agreement; (ii) each Rating Agency shall be given prior written notice of the
identity of the proposed successor to the Master Servicer and each Rating
Agency's ratings of the Certificates in effect immediately prior to such
assignment, sale and delegation will not be downgraded, qualified or withdrawn
as a result of such assignment, sale and delegation, as evidenced by a letter to
such effect delivered to the Master Servicer and the Trustee; and (iii) the
Master Servicer assigning and selling the master servicing shall deliver to the
Trustee an Officer's Certificate and an Opinion of Independent Counsel, each
stating that all conditions precedent to such action under this Agreement have
been completed and such action is permitted by and complies with the terms of
this Agreement. No such assignment or delegation shall affect any liability of
the Master Servicer arising prior to the effective date thereof.
ARTICLE VIII
Default
Section 8.01 EVENTS OF DEFAULT. "Event of Default," wherever used
herein, means any one of the following events (whatever the reason for such
Event of Default and whether it shall be voluntary or involuntary or be effected
by operation of law or pursuant to any judgment, decree or order of any court or
any order, rule or regulation of any administrative or governmental body) and
only with respect to the defaulting Master Servicer:
(i) The Master Servicer fails to cause to be deposited in the
Master Servicer Collection Account or the Distribution Account, as
applicable, any amount so required to be deposited pursuant to this
Agreement, and such failure continues unremedied for a period of three
Business Days after the date upon which written notice of such
failure, requiring the same to be remedied, shall have been given to
the Master Servicer; or
(ii) The Master Servicer fails to observe or perform in any
material respect any other material covenants and agreements set forth
in this Agreement to be performed by it, which covenants and
agreements materially affect the rights of Certificateholders, and
such failure continues unremedied for a period of 60 days (or, in the
case of a breach of its obligation to provide a Master Servicer
Certification pursuant to Section 3.18, 30 days) after the date on
which written notice of such failure, properly requiring the same to
be remedied, shall have been given to the Master Servicer by the
Trustee or to the Master Servicer and the Trustee by the Holders of
Certificates evidencing Fractional Undivided Interests aggregating not
less than 25% of the Trust; or
(iii) There is entered against the Master Servicer a decree or
order by a court or agency or supervisory authority having
jurisdiction in the premises for the appointment of a conservator,
receiver or liquidator in any insolvency, readjustment of debt,
marshaling of assets and liabilities or similar proceedings, or for
the winding up or liquidation of its affairs, and the continuance of
any such decree or order is unstayed and in effect for a period of 60
consecutive days, or an involuntary case is commenced against the
Master Servicer under any applicable insolvency or reorganization
statute and the petition is not dismissed within 60 days after the
commencement of the case; or
(iv) The Master Servicer consents to the appointment of a
conservator or receiver or liquidator in any insolvency, readjustment
of debt, marshaling of assets and liabilities or similar proceedings
of or relating to the Master Servicer or substantially all of its
property; or the Master Servicer admits in writing its inability to
pay its debts generally as they become due, files a petition to take
advantage of any applicable insolvency or reorganization statute,
makes an assignment for the benefit of its creditors, or voluntarily
suspends payment of its obligations; or
(v) The Master Servicer assigns or delegates its duties or rights
under this Agreement in contravention of the provisions permitting
such assignment or delegation under Sections 7.05.
In each and every such case, so long as such Event of Default with
respect to the Master Servicer shall not have been remedied, either the Trustee
or the Holders of Certificates evidencing Fractional Undivided Interests
aggregating not less than 51% of the principal of the Trust, by notice in
writing to the Master Servicer (and to the Trustee if given by such
Certificateholders), with a copy to each Rating Agency, and with the consent of
▇▇▇▇▇▇▇▇▇ (not to be unreasonably withheld), may terminate all of the rights and
obligations (but not the liabilities) of the Master Servicer under this
Agreement and in and to the Mortgage Loans and/or the REO Property serviced by
the Master Servicer and the proceeds thereof. Upon the receipt by the Master
Servicer of the written notice, all authority and power of the Master Servicer
under this Agreement, whether with respect to the Certificates, the Mortgage
Loans, REO Property or under any other related agreements (but only to the
extent that such other agreements relate to the Mortgage Loans or related REO
Property) shall, subject to Section 8.02, automatically and without further
action pass to and be vested in the Trustee pursuant to this Section 8.01; and,
without limitation, the Trustee is hereby authorized and empowered to execute
and deliver, on behalf of the Master 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. The Master Servicer
agrees to cooperate with the Trustee in effecting the termination of the Master
Servicer's rights and obligations hereunder, including, without limitation, the
transfer to the Trustee of (i) the property and amounts which are then or should
be part of the Trust or which thereafter become part of the Trust; and (ii)
originals or copies of all documents of the Master Servicer reasonably requested
by the Trustee to enable it to assume the Master Servicer's duties thereunder.
In addition to any other amounts which are then, or, notwithstanding the
termination of its activities under this Agreement, may become payable to the
Master Servicer under this Agreement, the Master Servicer shall be entitled to
receive, out of any amount received on account of a Mortgage Loan or related REO
Property, that portion of such payments which it would have received as
reimbursement under this Agreement if notice of termination had not been given.
The termination of the rights and obligations of the Master Servicer shall not
affect any obligations incurred by the Master Servicer prior to such
termination.
Section 8.02 TRUSTEE TO ACT; APPOINTMENT OF SUCCESSOR. (a) Upon the
receipt by the Master Servicer of a notice of termination pursuant to Section
8.01 or an Opinion of Independent Counsel pursuant to Section 7.05 to the effect
that the Master Servicer is legally unable to act or to delegate its duties to a
Person which is legally able to act, the Trustee shall automatically become the
successor in all respects to the Master Servicer in its capacity under this
Agreement and the transactions set forth or provided for herein and shall
thereafter be subject to all the responsibilities, duties, liabilities and
limitations on liabilities relating thereto placed on the Master Servicer by the
terms and provisions hereof; provided, however, that the Trustee shall have no
obligation whatsoever with respect to any liability (other than Monthly Advances
deemed recoverable and not previously made by the Master Servicer, which shall
be made by the Trustee in its place and stead) incurred by the Master Servicer
at or prior to the time of termination. As compensation therefor, but subject to
Section 7.06, the Trustee shall be entitled to all funds relating to the
Mortgage Loans which the Master Servicer would have been entitled to retain if
the Master Servicer had continued to act hereunder, except for those amounts due
the Master Servicer as reimbursement permitted under this Agreement for advances
previously made or expenses previously incurred. Notwithstanding the above, the
Trustee may, if it shall be unwilling so to act, or shall, if it is legally
unable so to act, appoint or petition a court of competent jurisdiction to
appoint, any established housing and home finance institution which is a ▇▇▇▇▇▇
▇▇▇- or ▇▇▇▇▇▇▇ Mac-approved servicer, and with respect to a successor to the
Master Servicer only, having a net worth of not less than $10,000,000, as the
successor to the Master Servicer hereunder in the assumption of all or any part
of the responsibilities, duties or liabilities of the Master Servicer hereunder;
provided, that the Trustee shall obtain a letter from each Rating Agency that
the ratings, if any, on each of the Certificates will not be lowered as a result
of the selection of the successor to the Master Servicer and such successor
Master Servicer shall be reasonably acceptable to ▇▇▇▇▇▇▇▇▇ in the event that
▇▇▇▇▇▇▇▇▇ does not choose to become the Master Servicer pursuant to Section
8.02(b). Pending appointment of a successor to the Master Servicer hereunder,
the Trustee shall 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 the Mortgage Loans as it
and such successor shall agree; provided, however, that the provisions of
Section 7.06 shall apply, no such compensation shall be in excess of that
permitted the Trustee under this Subsection 8.02(a), and that such successor
shall undertake and assume the obligations of the Trustee to pay compensation to
any third Person acting as an agent or independent contractor in the performance
of master servicing responsibilities hereunder. The Trustee and such successor
shall take such action, consistent with this Agreement, as shall be necessary to
effectuate any such succession.
(b) If the Trustee shall succeed to any duties of the Master Servicer
respecting the Mortgage Loans as provided herein, it shall do so in a separate
capacity and not in its capacity as Trustee and, accordingly, the provisions of
Article IX shall be inapplicable to the Trustee in its duties as the successor
to the Master Servicer in the servicing of the Mortgage Loans (although such
provisions shall continue to apply to the Trustee in its capacity as Trustee);
the provisions of Article VII, however, shall apply to it in its capacity as
successor master servicer. In the event that the Trustee shall not succeed to
the duties of the Master Servicer pursuant to Section 7.06 hereof, ▇▇▇▇▇▇▇▇▇
shall have the right, but not the obligation, to be appointed successor master
servicer hereunder.
Section 8.03 NOTIFICATION TO CERTIFICATEHOLDERS. Upon any termination
or appointment of a successor to the Master Servicer, the Trustee shall give
prompt written notice thereof to Certificateholders at their respective
addresses appearing in the Certificate Register and to each Rating Agency.
Section 8.04 WAIVER OF DEFAULTS. The Trustee shall transmit by mail to
all Certificateholders, within 60 days after the occurrence of any Event of
Default actually known to a Responsible Officer of the Trustee, unless such
Event of Default shall have been cured, notice of each such Event of Default
hereunder known to the Trustee. The Holders of Certificates evidencing
Fractional Undivided Interests aggregating not less than 51% of the Trust may,
on behalf of all Certificateholders, waive any default by the Master Servicer in
the performance of its obligations hereunder and the consequences thereof,
except a default in the making of or the causing to be made any required
distribution on the Certificates. Upon any such waiver of a past default, such
default shall be deemed to cease to exist, and any Event of Default arising
therefrom shall be deemed to have been timely remedied for every purpose of this
Agreement. No such waiver shall extend to any subsequent or other default or
impair any right consequent thereon except to the extent expressly so waived.
The Trustee shall give notice of any such waiver to each Rating Agency.
Section 8.05 LIST OF CERTIFICATEHOLDERS. Upon written request of three
or more Certificateholders of record, for purposes of communicating with other
Certificateholders with respect to their rights under this Agreement, the
Trustee will afford such Certificateholders access during business hours to the
most recent list of Certificateholders held by the Trustee.
ARTICLE IX
Concerning the Trustee and the Securities Administrator
Section 9.01 DUTIES OF TRUSTEE AND SECURITIES ADMINISTRATOR. (a) The
Trustee, prior to the occurrence of an Event of Default (of which a Responsible
Officer of the Trustee shall have actual knowledge) and after the curing or
waiver of all Events of Default which may have occurred, and the Securities
Administrator each undertake to perform such duties and only such duties as are
specifically set forth in this Agreement as duties of the Trustee and the
Securities Administrator, respectively. If an Event of Default has occurred (of
which a Responsible Officer of the Trustee shall have actual knowledge) and has
not been cured or waived, the Trustee shall exercise such of the rights and
powers vested in it by this Agreement, and subject to Section 8.02(b) use the
same degree of care and skill in their exercise, as a prudent person would
exercise under the circumstances in the conduct of his own affairs, unless the
Trustee is acting as successor Master Servicer, in which case it shall use the
same degree of care and skill as the Master Servicer hereunder.
(b) Upon receipt of all resolutions, certificates, statements,
opinions, reports, documents, orders or other instruments which are specifically
required to be furnished to the Trustee and the Securities Administrator
pursuant to any provision of this Agreement, the Trustee and the Securities
Administrator, respectively, shall examine them to determine whether they are in
the form required by this Agreement; provided, however, that neither the Trustee
nor the Securities Administrator shall be responsible for the accuracy or
content of any resolution, certificate, statement, opinion, report, document,
order or other instrument furnished by the Master Servicer, any Servicer or any
other party pursuant to this Agreement; provided, further, that neither the
Trustee nor the Securities Administrator shall be responsible for the accuracy
or verification of any calculation provided to it pursuant to this Agreement.
(c) On each Distribution Date, the Trustee shall make monthly
distributions and the final distribution to the Certificateholders from funds in
the Distribution Account as provided in Sections 6.01 and 10.01 herein based on
the report of the Securities Administrator. The Securities Administrator shall
file reports with the Securities Exchange Commission as specified in and in
accordance with Section 3.18.
(d) No provision of this Agreement shall be construed to relieve the
Trustee or the Securities Administrator from liability for its own negligent
action, its own negligent failure to act or its own willful misconduct;
provided, however, that:
(i) Prior to the occurrence of an Event of Default (of which a
Responsible Officer of the Trustee shall have actual knowledge), and
after the curing or waiver of all such Events of Default which may
have occurred, the duties and obligations of the Trustee and the
Securities Administrator shall be determined solely by the express
provisions of this Agreement, neither the Trustee nor the Securities
Administrator shall be liable except for the performance of their
respective duties and obligations as are specifically set forth in
this Agreement, no implied covenants or obligations shall be read into
this Agreement against the Trustee or the Securities Administrator
and, in the absence of bad faith on the part of the Trustee or the
Securities Administrator, respectively, the Trustee or the Securities
Administrator, respectively, may conclusively rely, as to the truth of
the statements and the correctness of the opinions expressed therein,
upon any certificates or opinions furnished to the Trustee or the
Securities Administrator, respectively, and conforming to the
requirements of this Agreement;
(ii) Neither the Trustee nor the Securities Administrator shall
be liable in its individual capacity or in any other capacity for an
error of judgment made in good faith by a Responsible Officer or
Responsible Officers of the Trustee or an officer of the Securities
Administrator, respectively, unless it shall be proved that the
Trustee or the Securities Administrator, respectively, was negligent
in ascertaining the pertinent facts;
(iii) Neither the Trustee nor the Securities Administrator shall
be liable with respect to any action taken, suffered or omitted to be
taken by it in good faith in accordance with the directions of the
Holders of Certificates evidencing Fractional Undivided Interests
aggregating not less than 25% of the Trust, if such action or
non-action relates to the time, method and place of conducting any
proceeding for any remedy available to the Trustee or the Securities
Administrator, respectively, or exercising any trust or other power
conferred upon the Trustee or the Securities Administrator,
respectively, under this Agreement;
(iv) The Trustee shall not be required to take notice or be
deemed to have notice or knowledge of any default or Event of Default
unless a Responsible Officer of the Trustee's Corporate Trust Office
shall have actual knowledge thereof. In the absence of such notice,
the Trustee may conclusively assume there is no such default or Event
of Default;
(v) The Trustee shall not in any way be liable by reason of any
insufficiency in any Account held by or in the name of Trustee unless
it is determined by a court of competent jurisdiction that the
Trustee's gross negligence or willful misconduct was the primary cause
of such insufficiency (except to the extent that the Trustee is
obligor and has defaulted thereon);
(vi) Anything in this Agreement to the contrary notwithstanding,
in no event shall the Trustee or the Securities Administrator be
liable for special, indirect or consequential loss or damage of any
kind whatsoever (including but not limited to lost profits), even if
the Trustee or the Securities Administrator, respectively, has been
advised of the likelihood of such loss or damage and regardless of the
form of action; and
(vii) Neither of the Securities Administrator nor the Trustee
shall be responsible for the acts or omissions of the other, it being
understood that this Agreement shall not be construed to render them
partners, joint venturers or agents of one another.
Neither the Trustee nor the Securities Administrator shall be required
to expend or risk its own funds or otherwise incur financial liability in the
performance of any of its duties hereunder, or in the exercise of any of its
rights or powers, if there is reasonable ground for believing that the repayment
of such funds or adequate indemnity against such risk or liability is not
reasonably assured to it, and none of the provisions contained in this Agreement
shall in any event require the Trustee or the Securities Administrator to
perform, or be responsible for the manner of performance of, any of the
obligations of the Master Servicer under the Servicing Agreements, except during
such time, if any, as the Trustee shall be the successor to, and be vested with
the rights, duties, powers and privileges of, the Master Servicer in accordance
with the terms of this Agreement.
(e) All funds received by the Trustee and required to be deposited in
the Distribution Account pursuant to this Agreement will be promptly so
deposited by the Trustee.
(f) Except for those actions that the Trustee or the Securities
Administrator is required to take hereunder, neither the Trustee nor the
Securities Administrator shall have any obligation or liability to take any
action or to refrain from taking any action hereunder in the absence of written
direction as provided hereunder.
(g) The Trustee shall remit to the applicable Servicer or the Master
Servicer if the identity of the applicable Servicer cannot be ascertained, upon
receipt, any complaint, claim, demand, notice or other document relating to a
Mortgage Loan (i) which is delivered to the Corporate Trust Office of the
Trustee, (ii) of which a Responsible Officer has actual knowledge, and (iii)
which contains information sufficient to permit the Trustee to make a
determination that the real property to which such document relates is Mortgaged
Property. The Trustee shall not be liable for any damages or losses resulting
from the failure to remit such documentation unless the foregoing conditions had
been met.
(h) Except as otherwise provided herein, the Trustee shall have no
duty (a) to see to any recording, filing, or depositing of this Agreement or any
agreement or assignment referred to herein or any financing statement evidencing
a security interest, or to see to the maintenance of any such recording or
filing or depositing or to any re-recording, re-filing or re-depositing of any
thereof (except, as set forth in Section 3.20, with respect to the filing of
continuation statements with respect to the UCC-1 financing statements filed on
behalf of the Trust in office of the Secretary of State of the State of
Delaware, on or around the Closing Date, naming each of the Depositor and the
Seller as the respective "Debtor" and covering the property of the Trust as set
forth in Section 2.01(a)), (b) to obtain any Insurance Policy with respect to a
Mortgage Loan, (c) to see to the payment or discharge of any tax, assessment, or
other governmental charge or any lien or encumbrance of any kind owing with
respect to, assessed or levied against, any part of the Trust (except to the
extent that a Responsible Officer of the Trustee has actual knowledge of such
owed amount and the Trustee reasonably could expect to be reimbursed by the
Trust pursuant to Section 9.05 for all such expenditures), or (d) to confirm or
verify the contents of any reports or certificates of the Master Servicer, any
Servicer, or any other party delivered to the Trustee pursuant to this Agreement
believed by the Trustee to be genuine and to have been signed or presented by
the proper party or parties.
Section 9.02 CERTAIN MATTERS AFFECTING THE TRUSTEE AND THE SECURITIES
ADMINISTRATOR. Except as otherwise provided in Section 9.01:
(i) The Trustee and the Securities Administrator may request and
rely and shall be fully protected in acting or refraining from acting
in reliance on any resolution, certificate of a Depositor, Master
Servicer or Servicer, Officer's Certificate, Opinion of Counsel,
certificate of auditors or any other certificate, statement,
instrument, opinion, report, notice, request, consent, order,
appraisal, bond or other paper or document believed by it to be
genuine and to have been signed or presented by the proper party or
parties and the Trustee and the Securities Administrator shall have no
responsibility to ascertain or confirm the genuineness of any
signature of any such party of parties;
(ii) The Trustee and the Securities Administrator may consult
with counsel, financial advisors or accountants, and any advice of
such counsel, financial advisors or accountants or any Opinion of
Counsel shall be full and complete authorization and protection with
respect to any action taken or suffered or omitted by it hereunder in
good faith and in accordance with such advice or Opinion of Counsel;
(iii) Neither the Trustee nor the Securities Administrator shall
be under any obligation to exercise any of the trusts or powers vested
in it by this Agreement, other than its obligation to give notices
pursuant to this Agreement, or to institute, conduct or defend any
litigation hereunder or in relation hereto at the request, order or
direction of any of the Certificateholders pursuant to the provisions
of this Agreement, unless such Certificateholders shall have offered
to the Trustee reasonable security or indemnity satisfactory to the
Trustee against the costs, expenses and liabilities which may be
incurred therein or thereby. Nothing contained herein shall, however,
relieve the Trustee of the obligation, upon the occurrence of an Event
of Default of which a Responsible Officer of the Trustee's Corporate
Trust Office has actual knowledge (which has not been cured or
waived), subject to Section 8.02(b), to exercise such of the rights
and powers vested in it by this Agreement, and to use the same degree
of care and skill in their exercise, as a prudent person would
exercise under the circumstances in the conduct of his own affairs;
(iv) Neither the Trustee nor the Securities Administrator shall
be liable in its individual capacity for any action taken, suffered or
omitted by it in good faith and believed by it to be authorized or
within the discretion or rights or powers conferred upon it by this
Agreement;
(v) Neither the Trustee nor the Securities Administrator shall be
bound to make any investigation into the facts or matters stated in
any resolution, certificate, statement, instrument, opinion, report,
notice, request, consent, order, approval, bond or other paper or
document, unless requested in writing to do so by Holders of
Certificates evidencing Fractional Undivided Interests aggregating not
less than 25% of the Trust and provided that the payment within a
reasonable time to the Trustee or the Securities Administrator, as
applicable, of the costs, expenses or liabilities likely to be
incurred by it in the making of such investigation is, in the opinion
of the Trustee or the Securities Administrator, as applicable,
reasonably assured to the Trustee or the Securities Administrator, as
applicable, by the security afforded to it by the terms of this
Agreement. The Trustee or the Securities Administrator may require
indemnity reasonably satisfactory to the Trustee or the Securities
Administrator, as applicable, against such expense, cost or liability
as a condition to taking any such action. The reasonable expense of
every such examination shall be paid by the Certificateholders
requesting the investigation;
(vi) The Trustee and the Securities Administrator may execute any
of the trusts or powers hereunder or perform any duties hereunder
either directly or through Affiliates, agents, custodians, accountants
or attorneys. Neither the Trustee nor the Securities Administrator
shall be liable or responsible for the misconduct or negligence of any
of the Trustee's or the Securities Administrator's agents, custodians,
accountants or attorneys, or a Custodian or paying agent appointed
hereunder by the Trustee or the Securities Administrator with due care
and, when required, with the consent of the Master Servicer;
(vii) Should the Trustee or the Securities Administrator deem the
nature of any action required on its part to be unclear, the Trustee
or the Securities Administrator, respectively, may require prior to
such action that it be provided by the Depositor with reasonable
further instructions;
(viii) The right of the Trustee or the Securities Administrator
to perform any discretionary act enumerated in this Agreement shall
not be construed as a duty, and neither the Trustee nor the Securities
Administrator shall be accountable for other than its negligence or
willful misconduct in the performance of any such act;
(ix) Neither the Trustee nor the Securities Administrator shall
be required to give any bond or surety with respect to the execution
of the trust created hereby or the powers granted hereunder, except as
provided in Subsection 9.07; and
(x) Neither the Trustee nor the Securities Administrator shall
have any duty to conduct any affirmative investigation as to the
occurrence of any condition requiring the repurchase of any Mortgage
Loan by the Seller pursuant to this Agreement or the Mortgage Loan
Purchase Agreement, as applicable, or the eligibility of any Mortgage
Loan for purposes of this Agreement.
Section 9.03 TRUSTEE AND SECURITIES ADMINISTRATOR NOT LIABLE FOR
CERTIFICATES OR MORTGAGE LOANS. The recitals contained herein and in the
Certificates (other than the signature and authentication of the Trustee on the
Certificates) shall be taken as the statements of the Depositor or ▇▇▇▇▇▇▇▇▇,
and neither the Trustee nor the Securities Administrator shall have any
responsibility for their correctness. Neither the Trustee nor the Securities
Administrator makes any representation as to the validity or sufficiency of the
Certificates (other than the signature and authentication of the Trustee on the
Certificates) or of any Mortgage Loan except as expressly provided in Sections
2.02 and 2.04 hereof; provided, however, that the foregoing shall not relieve
the Trustee of the obligation to review the Mortgage Files pursuant to Sections
2.02 and 2.04. The Trustee's signature and authentication (or authentication of
its agent) on the Certificates shall be solely in its capacity as Trustee and
shall not constitute the Certificates an obligation of the Trustee in any other
capacity. Neither the Trustee nor the Securities Administrator shall be
accountable for the use or application by the Depositor of any of the
Certificates or of the proceeds of such Certificates, or for the use or
application of any funds paid to the Depositor with respect to the Mortgage
Loans. Subject to the provisions of Section 2.05, neither the Trustee nor the
Securities Administrator shall be responsible for the legality or validity of
this Agreement or any document or instrument relating to this Agreement, the
validity of the execution of this Agreement or of any supplement hereto or
instrument of further assurance, or the validity, priority, perfection or
sufficiency of the security for the Certificates issued hereunder or intended to
be issued hereunder. Neither the Trustee nor the Securities Administrator shall
at any time have any responsibility or liability for or with respect to the
legality, validity and enforceability of any Mortgage or any Mortgage Loan, or
the perfection and priority of any Mortgage or the maintenance of any such
perfection and priority, or for or with respect to the sufficiency of the Trust
or its ability to generate the payments to be distributed to Certificateholders,
under this Agreement. Neither the Trustee nor the Securities Administrator shall
have any responsibility for filing any financing or continuation statement in
any public office at any time or to otherwise perfect or maintain the perfection
of any security interest or lien granted to it hereunder or to record this
Agreement other than any continuation statements filed by the Trustee pursuant
to Section 3.20.
Section 9.04 TRUSTEE, CUSTODIAN, DELAWARE TRUSTEE, MASTER SERVICER AND
SECURITIES ADMINISTRATOR MAY OWN CERTIFICATES. The Trustee, the Custodian, the
Delaware Trustee, the Master Servicer and the Securities Administrator in their
respective individual capacities, or in any capacity other than as Trustee,
Custodian, Delaware Trustee, Master Servicer or Securities Administrator
hereunder, may become the owner or pledgee of any Certificates with the same
rights they would have if they were not Trustee, Custodian, Delaware Trustee,
Master Servicer or Securities Administrator, as applicable, and may otherwise
deal with the parties hereto.
Section 9.05 TRUSTEE'S, DELAWARE TRUSTEE'S AND SECURITIES
ADMINISTRATOR'S FEES AND EXPENSES. As compensation for its services hereunder,
the Trustee shall be entitled to receive the Trustee Fee. The Delaware Trustee
shall be compensated by the Trustee for its services hereunder. The Securities
Administrator shall be compensated by the Master Servicer for its services
hereunder. In addition, the Trustee, the Delaware Trustee and the Securities
Administrator will be entitled to recover from the Distribution Account pursuant
to Section 4.05(a) all reasonable out-of-pocket expenses, disbursements and
advances and the expenses of the Trustee (including for such purpose, any fees
and expenses relating to its capacity as Custodian hereunder to the extent not
paid by ▇▇▇▇▇▇▇▇▇), the Delaware Trustee and the Securities Administrator,
respectively, including without limitation, in connection with any Event of
Default, any breach of this Agreement or any claim or legal action (including
any pending or threatened claim or legal action) incurred or made by the Trustee
or the Securities Administrator, respectively, in the administration of the
trusts hereunder (including the reasonable compensation, expenses and
disbursements of its counsel) except any such expense, disbursement or advance
as may arise from its negligence or intentional misconduct or which is
specifically designated herein as the responsibility of the Depositor, the
Seller, the Master Servicer, the Certificateholders or the Trust hereunder. If
funds in the Master Servicer Collection Account and/or the Distribution Account,
as applicable, are insufficient therefor, the Trustee, the Delaware Trustee, the
Custodian and the Securities Administrator shall recover such expenses from
future collections on the Mortgage Loans or as otherwise agreed by the
Certificateholders. Such compensation and reimbursement obligation shall not be
limited by any provision of law in regard to the compensation of a trustee of an
express trust.
Section 9.06 ELIGIBILITY REQUIREMENTS FOR TRUSTEE, SECURITIES
ADMINISTRATOR AND DELAWARE TRUSTEE. (a) The Trustee and any successor Trustee
and the Securities Administrator and any successor Securities Administrator
shall during the entire duration of this Agreement be a state bank or trust
company or a national banking association organized and doing business under the
laws of such state or the United States of America, authorized under such laws
to exercise corporate trust powers, having a combined capital and surplus and
undivided profits of at least $40,000,000 or, in the case of a successor
Trustee, $50,000,000, subject to supervision or examination by federal or state
authority and, in the case of the Trustee, rated "Baa2" or higher by each Rating
Agency with respect to any outstanding long-term unsecured unsubordinated debt,
and, in the case of a successor Trustee or successor Securities Administrator
other than pursuant to Section 9.10, rated in one of the two highest long-term
debt categories of, or otherwise acceptable to, each Rating Agency. If the
Trustee publishes reports of condition at least annually, pursuant to law or to
the requirements of the aforesaid supervising or examining authority, then for
the purposes of this Section 9.06 the combined capital and surplus of such
corporation shall be deemed to be its total equity capital (combined capital and
surplus) as set forth in its most recent report of condition so published. In
case at any time the Trustee or the Securities Administrator shall cease to be
eligible in accordance with the provisions of this Section 9.06, the Trustee or
the Securities Administrator shall resign immediately in the manner and with the
effect specified in Section 9.08.
(b) The Delaware Trustee shall at all times be a trustee eligible to
serve in such capacity pursuant to the provisions of the Delaware Statutory
Trust Statute. There shall at all times be a Delaware trustee of the Trust, and
in the event, that the Delaware Trustee no longer serves as the Delaware
trustee, the Trustee shall be responsible for the appointment of a successor
Delaware trustee.
Section 9.07 INSURANCE. The Trustee and the Securities Administrator,
at their own expense, shall at all times maintain and keep in full force and
effect: (i) fidelity insurance, (ii) theft of documents insurance and (iii)
forgery insurance (which may be collectively satisfied by a "Financial
Institution Bond" and/or a "Bankers' Blanket Bond"). All such insurance shall be
in amounts, with standard coverage and subject to deductibles, as are customary
for insurance typically maintained by banks or their affiliates which act as
custodians for investor-owned mortgage pools. A certificate of an officer of the
Trustee or the Securities Administrator as to the Trustee's or the Securities
Administrator's, respectively, compliance with this Section 9.07 shall be
furnished to any Certificateholder upon reasonable written request.
Section 9.08 RESIGNATION AND REMOVAL OF THE TRUSTEE AND SECURITIES
ADMINISTRATOR. (a) The Trustee and the Securities Administrator may at any time
resign and be discharged from the Trust hereby created by giving written notice
thereof to the Depositor and the Master Servicer, with a copy to each Rating
Agency. Upon receiving such notice of resignation, the Depositor shall promptly
appoint a successor Trustee or successor Securities Administrator, as
applicable, by written instrument, in triplicate, one copy of which instrument
shall be delivered to each of the resigning Trustee or Securities Administrator,
as applicable, the successor Trustee or Securities Administrator, as applicable.
If no successor Trustee or Securities Administrator shall have been so appointed
and have accepted appointment within 30 days after the giving of such notice of
resignation, the resigning Trustee or Securities Administrator may petition any
court of competent jurisdiction for the appointment of a successor Trustee or
Securities Administrator.
(b) If at any time the Trustee or the Securities Administrator shall
cease to be eligible in accordance with the provisions of Section 9.06 and shall
fail to resign after written request therefor by the Depositor or if at any time
the Trustee or the Securities Administrator shall become incapable of acting, or
shall be adjudged a bankrupt or insolvent, or a receiver of the Trustee or the
Securities Administrator, as applicable, or of its property shall be appointed,
or any public officer shall take charge or control of the Trustee or the
Securities Administrator, as applicable, or of its property or affairs for the
purpose of rehabilitation, conservation or liquidation, then the Depositor shall
promptly remove the Trustee, or shall be entitled to remove the Securities
Administrator, as applicable, and appoint a successor Trustee or Securities
Administrator, as applicable, by written instrument, in triplicate, one copy of
which instrument shall be delivered to each of the Trustee or Securities
Administrator, as applicable, so removed, the successor Trustee or Securities
Administrator, as applicable.
(c) The Holders of Certificates evidencing Fractional Undivided
Interests aggregating not less than 51% of the Trust may at any time remove the
Trustee or the Securities Administrator and appoint a successor Trustee or
Securities Administrator by written instrument or instruments, in quadruplicate,
signed by such Holders or their attorneys-in-fact duly authorized, one complete
set of which instruments shall be delivered to the Depositor, the Master
Servicer, the Securities Administrator (if the Trustee is removed), the Trustee
(if the Securities Administrator is removed), and the Trustee or Securities
Administrator so removed and the successor so appointed.
(d) No resignation or removal of the Trustee or the Securities
Administrator and appointment of a successor Trustee or Securities Administrator
pursuant to any of the provisions of this Section 9.08 shall become effective
except upon appointment of and acceptance of such appointment by the successor
Trustee or Securities Administrator as provided in Section 9.09.
(e) Notwithstanding anything to the contrary contained herein, in the
event that the Master Servicer resigns or is removed as Master Servicer
hereunder, the Securities Administrator shall have the right to resign
immediately as Securities Administrator by giving written notice to the
Depositor and the Trustee, with a copy to each Rating Agency.
Section 9.09 SUCCESSOR TRUSTEE AND SUCCESSOR SECURITIES ADMINISTRATOR.
(a) Any successor Trustee or Securities Administrator appointed as provided in
Section 9.08 shall execute, acknowledge and deliver to the Depositor and to its
predecessor Trustee or Securities Administrator an instrument accepting such
appointment hereunder. The resignation or removal of the predecessor Trustee or
Securities Administrator shall then become effective and such successor Trustee
or Securities Administrator, without any further act, deed or conveyance, shall
become fully vested with all the rights, powers, duties and obligations of its
predecessor hereunder, with like effect as if originally named as Trustee or
Securities Administrator herein. The predecessor Trustee or Securities
Administrator shall after payment of its outstanding fees and expenses promptly
deliver to the successor Trustee or Securities Administrator, as applicable, all
assets and records of the Trust held by it hereunder, and the Depositor and the
predecessor Trustee or Securities Administrator, as applicable, shall execute
and deliver such instruments and do such other things as may reasonably be
required for more fully and certainly vesting and confirming in the successor
Trustee or Securities Administrator, as applicable, all such rights, powers,
duties and obligations.
(b) No successor Trustee or Securities Administrator shall accept
appointment as provided in this Section 9.09 unless at the time of such
acceptance such successor Trustee or Securities Administrator shall be eligible
under the provisions of Section 9.06.
(c) Upon acceptance of appointment by a successor Trustee or
Securities Administrator as provided in this Section 9.09, the successor Trustee
or Securities Administrator shall mail notice of the succession of such Trustee
or Securities Administrator hereunder to all Certificateholders at their
addresses as shown in the Certificate Register and to each Rating Agency. The
Trust shall pay the cost of any mailing by the successor Trustee or Securities
Administrator.
Section 9.10 MERGER OR CONSOLIDATION OF TRUSTEE OR SECURITIES
ADMINISTRATOR. Any person into which the Trustee or the Securities Administrator
may be merged or converted or with which it may be consolidated or any state
bank or trust company or national banking association resulting from any merger,
conversion or consolidation to which the Trustee or the Securities
Administrator, respectively, shall be a party, or any state bank or trust
company or national banking association succeeding to all or substantially all
of the corporate trust business of the Trustee or the Securities Administrator,
respectively, shall be the successor of the Trustee or the Securities
Administrator, respectively, hereunder, provided such state bank or trust
company or national banking association shall be eligible under the provisions
of Section 9.06. Such succession shall be valid without the execution or filing
of any paper or any further act on the part of any of the parties hereto,
anything herein to the contrary notwithstanding.
Section 9.11 APPOINTMENT OF CO-TRUSTEE OR SEPARATE TRUSTEE. (a)
Notwithstanding any other provisions hereof, and in addition to the appointment
of the Delaware Trustee pursuant to Section 1A.03 hereof, at any time, for the
purpose of meeting any legal requirements of any jurisdiction in which any part
of the Trust or property constituting the same may at the time be located, the
Depositor and the Trustee acting jointly shall have the power and shall execute
and deliver all instruments to appoint one or more Persons approved by the
Trustee and the Depositor to act as co-trustee or co-trustees, jointly with the
Trustee, or separate trustee or separate trustees, of all or any part of the
Trust, and to vest in such Person or Persons, in such capacity, such title to
the Trust, or any part thereof, and, subject to the other provisions of this
Section 9.11, such powers, duties, obligations, rights and trusts as the
Depositor and the Trustee may consider necessary or desirable.
(b) If the Depositor shall not have joined in such appointment within
15 days after the receipt by it of a written request so to do, the Trustee shall
have the power to make such appointment without the Depositor.
(c) No co-trustee or separate trustee hereunder shall be required to
meet the terms of eligibility as a successor Trustee under Section 9.06
hereunder and no notice to Certificateholders of the appointment of
co-trustee(s) or separate trustee(s) shall be required under Section 9.08
hereof.
(d) In the case of any appointment of a co-trustee or separate trustee
pursuant to this Section 9.11, all rights, powers, duties and obligations
conferred or imposed upon the Trustee and required to be conferred on such
co-trustee shall be conferred or imposed upon and exercised or performed by the
Trustee and such separate trustee or co-trustee jointly, except to the extent
that under any law of any jurisdiction in which any particular act or acts are
to be performed (whether as Trustee hereunder or as successor to the Master
Servicer hereunder), the Trustee shall be incompetent or unqualified to perform
such act or acts, in which event such rights, powers, duties and obligations
(including the holding of title to the Trust or any portion thereof in any such
jurisdiction) shall be exercised and performed by such separate trustee or
co-trustee at the direction of the Trustee.
(e) Any notice, request or other writing given to the Trustee shall be
deemed to have been given to each of the then separate trustees and co-trustees,
as effectively as if given to each of them. Every instrument appointing any
separate trustee or co-trustee shall refer to this Agreement and the conditions
of this Article IX. Each separate trustee and co-trustee, upon its acceptance of
the 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.
(f) To the extent not prohibited by law, any separate trustee or
co-trustee may, at any time, request the Trustee, its agent or attorney-in-fact,
with full power and authority, to do any lawful act under or with respect to
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.
(g) No trustee under this Agreement shall be liable personally or
otherwise by reason of any act or omission of another trustee under this
Agreement. The Depositor and the Trustee acting jointly may at any time accept
the resignation of or remove any separate trustee or co-trustee.
Section 9.12 FEDERAL INFORMATION RETURNS AND REPORTS TO
CERTIFICATEHOLDERS; REMIC ADMINISTRATION. (a) For federal income tax purposes,
the taxable year of each of REMIC I and REMIC II shall be a calendar year and
the Securities Administrator shall maintain or cause the maintenance of the
books of each such REMIC on the accrual method of accounting.
(b) The Securities Administrator shall prepare and file or cause to be
filed with the Internal Revenue Service, and the Trustee shall sign, Federal tax
information returns or elections required to be made hereunder with respect to
each of REMIC I and REMIC II, the Trust, if applicable, and the Certificates
containing such information and at the times and in the manner as may be
required by the Code or applicable Treasury regulations, and shall furnish to
each Holder of Certificates at any time during the calendar year for which such
returns or reports are made such statements or information at the times and in
the manner as may be required thereby, including, without limitation, reports
relating to interest, original issue discount and market discount or premium
(using a constant prepayment assumption of 25% CPR). The Securities
Administrator will apply for an Employee Identification Number from the IRS
under Form SS-4 or any other acceptable method for all tax entities. In
connection with the foregoing, the Securities Administrator shall timely prepare
and file, and the Trustee shall sign, IRS Form 8811, which shall provide the
name and address of the person who can be contacted to obtain information
required to be reported to the holders of regular interests in each of REMIC I
and REMIC II (the "REMIC Reporting Agent"). The Trustee shall make elections to
treat each of REMIC I and REMIC II as a REMIC (which elections shall apply to
the taxable period ending December 31, 2004 and each calendar year thereafter)
in such manner as the Code or applicable Treasury regulations may prescribe, and
as described by the Securities Administrator. The Trustee shall sign all tax
information returns filed pursuant to this Section and any other returns as may
be required by the Code. The Holder of the Class R-1 Certificate is hereby
designated as the "Tax Matters Person" (within the meaning of Treas. Reg.
ss.ss.1.860F-4(d)) for REMIC I, and the Holder of the Class R-2 Certificate is
hereby designated as the "Tax Matters Person" for REMIC II. The Securities
Administrator is hereby designated and appointed as the agent of each such Tax
Matters Person. Any Holder of a Residual Certificate will by acceptance thereof
appoint the Securities Administrator as agent and attorney-in-fact for the
purpose of acting as Tax Matters Person for each of REMIC I and REMIC II during
such time as the Securities Administrator does not own any such Residual
Certificate. In the event that the Code or applicable Treasury regulations
prohibit the Trustee from signing tax or information returns or other
statements, or the Securities Administrator from acting as agent for the Tax
Matters Person, the Trustee and the Securities Administrator shall take whatever
action that in its sole good faith judgment is necessary for the proper filing
of such information returns or for the provision of a tax matters person,
including designation of the Holder of a Residual Certificate to sign such
returns or act as tax matters person. Each Holder of a Residual Certificate
shall be bound by this Section.
(c) The Securities Administrator shall provide upon request and
receipt of reasonable compensation, such information as required in Section
860D(a)(6)(B) of the Code to the Internal Revenue Service, to any Person
purporting to transfer a Residual Certificate to a Person other than a
transferee permitted by Section 5.05(b), and to any regulated investment
company, real estate investment trust, common trust fund, partnership, trust,
estate, organization described in Section 1381 of the Code, or nominee holding
an interest in a pass-through entity described in Section 860E(e)(6) of the
Code, any record holder of which is not a transferee permitted by Section
5.05(b) (or which is deemed by statute to be an entity with a disqualified
member).
(d) The Securities Administrator shall prepare and file or cause to be
filed, and the Trustee shall sign, any state income tax returns required under
Applicable State Law with respect to each of REMIC I and REMIC II or the Trust.
(e) Notwithstanding any other provision of this Agreement, the Trustee
and the Securities Administrator shall comply with all federal withholding
requirements respecting payments to Certificateholders of interest or original
issue discount on the Mortgage Loans, that the Trustee or the Securities
Administrator reasonably believes are applicable under the Code. The consent of
Certificateholders shall not be required for such withholding. In the event the
Trustee or the Securities Administrator withholds any amount from interest or
original issue discount payments or advances thereof to any Certificateholder
pursuant to federal withholding requirements, the Trustee or the Securities
Administrator shall, together with its monthly report to such
Certificateholders, indicate such amount withheld.
(f) The Trustee and the Securities Administrator agree to indemnify
the Trust and the Depositor for any taxes and costs including, without
limitation, any reasonable attorneys fees imposed on or incurred by the Trust,
the Depositor or the Master Servicer, as a result of a breach of the Trustee's
covenants and the Securities Administrator's covenants, respectively, set forth
in this Section 9.12; provided, however, such liability and obligation to
indemnify in this paragraph shall not be joint and several and neither the
Trustee nor the Securities Administrator shall be liable or be obligated to
indemnify the Trust for the failure by the other to perform any duty under this
Agreement or the breach by the other of any covenant in this Agreement.
ARTICLE X
Termination
▇▇▇▇▇▇▇ ▇▇.▇▇ ▇▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇▇▇▇▇ BY THE DEPOSITOR, ▇▇▇▇▇▇▇▇▇
OR ITS DESIGNEE OR LIQUIDATION OF THE MORTGAGE LOANS.
(a) Subject to Section 10.02, the respective obligations and
responsibilities of the Depositor, ▇▇▇▇▇▇▇▇▇, the Trustee, the Delaware Trustee,
the Custodian, the Master Servicer and the Securities Administrator created
hereby, other than the obligation of the Trustee to make payments to
Certificateholders as hereinafter set forth shall terminate upon:
(i) the repurchase by ▇▇▇▇▇▇▇▇▇, in its capacity as the Servicer
of a substantial portion of the Mortgage Loans, or the Depositor (as
the case may be pursuant to Section 10.01(c) below) of all Mortgage
Loans and all related REO Property remaining in the Trust at a price
equal to (I) the sum of (a) 100% of the Scheduled Principal Balance of
each Mortgage Loan (other than a Mortgage Loan related to REO
Property) as of the date of repurchase, together with interest at the
applicable Mortgage Rate accrued but unpaid to, but not including, the
first day of the month of repurchase, (b) the appraised value of any
related REO Property, together with interest at the applicable
Mortgage Rate accrued on that balance but unpaid to, but not
including, the first day of the month of repurchase, such appraisal to
be calculated by an appraiser mutually agreed upon by ▇▇▇▇▇▇▇▇▇ or the
Depositor, as applicable, and the Trustee, at the expense of ▇▇▇▇▇▇▇▇▇
or the Depositor, as applicable, (c) any unpaid Master Servicing Fee,
Trustee Fee, Delaware Trustee Fee or Servicing Fee relating to such
Mortgage Loans (to the extent that accrued interest paid by ▇▇▇▇▇▇▇▇▇
or the Depositor at the related Mortgage Rate for each such Mortgage
Loan for the immediately preceding Due Period is less than interest
thereon at the Aggregate Expense Rate for such Due Period) and (d) any
Monthly Advances, advances and other amounts then due and owing to the
Master Servicer, any Servicer, the Securities Administrator, the
Trustee and the Delaware Trustee under this Agreement minus (II) any
Servicing Fee, Monthly Advances or advances by ▇▇▇▇▇▇▇▇▇, as Servicer
relating to any such Mortgage Loans if ▇▇▇▇▇▇▇▇▇ is exercising the
option; or
(ii) the later of the making of the final payment or other
liquidation, or any advance with respect thereto, of the last Mortgage
Loan remaining in the Trust or the disposition of all property
acquired with respect to any Mortgage Loan; provided, however, that in
the event that an advance has been made, but not yet recovered, at the
time of such termination, the Person having made such advance shall be
entitled to receive, notwithstanding such termination, any payments
received subsequent thereto with respect to which such advance was
made; or
(iii) the payment to Certificateholders of all amounts required
to be paid to them pursuant to this Agreement.
(b) [Reserved];
(c) (i) The right of ▇▇▇▇▇▇▇▇▇ to repurchase all the Mortgage Loans
pursuant to Subsection 10.01(a)(i) above shall be exercisable only if the
aggregate Scheduled Principal Balance of the Mortgage Loans at the time of any
such repurchase is less than 10% of the Cut-off Date Balance; and (ii) the right
of the Depositor to repurchase all the Mortgage Loans pursuant to Subsection
10.01(a)(i) above shall be exercisable only if the Trustee or the Securities
Administrator, based upon an Opinion of Counsel (to be obtained at the expense
of the Depositor), has determined that the REMIC status of REMIC I or REMIC II
has been lost or that a substantial risk exists that such REMIC status will be
lost for the then-current taxable year. At any time thereafter, in the case of
(ii) above, the Securities Administrator, as agent of the Tax Matters Persons
may elect to terminate either or both of REMIC I and/or REMIC II at any time,
and upon such election the Depositor shall repurchase all the Mortgage Loans.
(d) The Trustee shall give notice of any termination to the
Certificateholders, with a copy to the Master Servicer, the Delaware Trustee,
the Custodian, the Depositor, the Seller, the Securities Administrator and each
Rating Agency, upon which the Certificateholders shall surrender their
Certificates to the Trustee for payment of the final distribution and
cancellation. Such notice shall be given by letter, mailed not earlier than the
l5th day and not later than the 25th day of the month next preceding the month
of such final distribution, and shall specify (i) the Distribution Date upon
which final payment of the Certificates will be made upon presentation and
surrender of the Certificates at the office of the Trustee therein designated,
(ii) the amount of any such final payment and (iii) that the Record Date
otherwise applicable to such Distribution Date is not applicable, payments being
made only upon presentation and surrender of the Certificates at the office of
the Trustee therein specified.
If the option of ▇▇▇▇▇▇▇▇▇ or the Depositor, as applicable, to
repurchase or cause the repurchase of all the Mortgage Loans under Subsection
10.01 (a)(i) above is exercised, ▇▇▇▇▇▇▇▇▇ or the Depositor, as applicable,
shall deliver to the Trustee for deposit in the Distribution Account, by the
Business Day prior to the applicable Distribution Date, an amount equal to the
repurchase price for the Mortgage Loans being purchased by it and all property
acquired with respect to such Mortgage Loans remaining in REMIC I and REMIC II.
Upon presentation and surrender of the Certificates by the Certificateholders,
the Trustee shall distribute to the Certificateholders an amount determined as
follows: with respect to each Certificate (other than the Class R Certificates),
the outstanding Current Principal Amount, plus with respect to each Certificate
(other than the Class B-IO Certificates and the Class R Certificates), one
month's interest thereon at the applicable Pass-Through Rate; plus, with respect
to the Class B-IO Certificates, accrued and unpaid interest thereon; and with
respect to the Class R Certificates, the percentage interest evidenced thereby
multiplied by the difference, if any, between the above described repurchase
price and the aggregate amount to be distributed to the Holders of the
Certificates (other than the Class R Certificates). If the proceeds with respect
to Loan Group I and/or Loan Group II are not sufficient to pay the related
Senior Certificates, any such deficiency will be allocated in the following
order: (i) first, to reduce the amount owed in respect of the Class B-IO
Certificates (allocating such deficiency to Loan Group I and Loan Group II pro
rata based on the amounts of such deficiencies), and (ii) second, to reduce the
aggregate amount of one month's interest and then the aggregate Current
Principal Amount owed in respect of the Class I-M Certificates or Class II-M
Certificates, respectively. If any deficit remains, it shall be deemed in each
case that the amount of such deficit offset against amounts due on a Class of
Subordinate Certificates attributable to each Loan Subgroup will be determined
by pro rata allocation among the Loan Subgroups in a particular Loan Group based
upon the relative amounts of the deficits relating to each Subgroup. Any excess
deficiency allocable to each Loan Group will be applied to reduce first, one
month's interest owed at the applicable Pass-Through Rate on the related Senior
Certificates, and second, the aggregate Current Principal Amount owed in respect
of the related Senior Certificates.
(e) Upon deposit of the required repurchase price and following such
final Distribution Date, the Trustee shall release promptly to ▇▇▇▇▇▇▇▇▇, or its
designee, the Mortgage Files for the remaining applicable Mortgage Loans, and
the Accounts with respect thereto shall terminate, subject to the Trustee's
obligation to hold any amounts payable to Certificateholders in trust without
interest pending final distributions pursuant to Subsection 10.01(g).
(f) In the event that this Agreement is terminated by reason of the
payment or liquidation of all Mortgage Loans or the disposition of all property
acquired with respect to all Mortgage Loans under Subsection 10.01(a)(ii) above,
the Master Servicer shall deliver to the Trustee for deposit in the Distribution
Account all distributable amounts remaining in the Master Servicer Collection
Account. Upon the presentation and surrender of the Certificates, the Trustee
shall distribute to the remaining Certificateholders, in accordance with their
respective interests, all distributable amounts remaining in the Distribution
Account. Upon deposit by the Master Servicer of such distributable amounts, and
following such final Distribution Date, the Trustee shall release promptly to
▇▇▇▇▇▇▇▇▇ or the Depositor, or its designee, as applicable, the Mortgage Files
for the remaining Mortgage Loans, and the Master Servicer Collection Account and
the Distribution Account shall terminate, subject to the Trustee's obligation to
hold any amounts payable to the Certificateholders in trust without interest
pending final distributions pursuant to Subsection 10.01(g).
(g) If not all of the Certificateholders shall surrender their
Certificates for cancellation within six months after the time 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, not all the Certificates shall have been
surrendered for cancellation, the Trustee may take appropriate steps, or appoint
any agent to take appropriate steps, to contact the remaining Certificateholders
concerning surrender of their Certificates, and the cost thereof shall be paid
out of the funds and other assets which remain subject to this Agreement.
(h) Upon the termination or liquidation of the REMICs, the Trustee or
the Delaware Trustee shall file a certificate of cancellation with the Delaware
Secretary of State in accordance with Section 3810(d) of the Delaware Statutory
Trust Statute, and the Trust's existence shall be terminated.
Section 10.02 ADDITIONAL TERMINATION REQUIREMENTS. (a) If the option
of ▇▇▇▇▇▇▇▇▇ or the Depositor, as applicable, to repurchase all the Mortgage
Loans under Subsection 10.01(a)(i) above is exercised, the Trust and each of
REMIC I and REMIC II shall be terminated in accordance with the following
additional requirements, unless the Securities Administrator and the Trustee
have been furnished with an Opinion of Counsel (at the expense of the Depositor
or ▇▇▇▇▇▇▇▇▇, whichever is repurchasing the Mortgage Loans) to the effect that
the failure of the Trust to comply with the requirements of this Section 10.02
will not (i) result in the imposition of taxes on "prohibited transactions" as
defined in Section 860F of the Code on each of REMIC I and REMIC II or (ii)
cause any REMIC to fail to qualify as a REMIC at any time that any Regular
Certificates are outstanding:
(i) within 90 days prior to the final Distribution Date, the
Depositor or ▇▇▇▇▇▇▇▇▇, whichever is purchasing the Mortgage Loans,
shall prepare, and the Trustee and the Securities Administrator (as
attorney-in-fact on behalf of the Holders of the Residual Certificates
pursuant to Section 10.02(b)), shall adopt a plan of complete
liquidation of REMIC I and REMIC II in the case of a termination under
Subsection 10.01(a)(i), provided to it by the Depositor or ▇▇▇▇▇▇▇▇▇,
as applicable, meeting the requirements of a "qualified liquidation"
under Section 860F of the Code and any regulations thereunder, as
evidenced by an Opinion of Counsel delivered to the Securities
Administrator and the Trustee, at the expense of ▇▇▇▇▇▇▇▇▇ or the
Depositor, whichever is repurchasing the Mortgage Loans; and
(ii) ▇▇▇▇▇▇▇▇▇ or the Depositor, as applicable, shall notify the
Securities Administrator and the Trustee in writing at the
commencement of such 90-day liquidation period and, at or prior to the
time of making the final payment on the Certificates, the Trustee
shall sell or otherwise dispose of all of the remaining assets of the
Trust in accordance with the terms hereof; and REMIC I and REMIC II
shall terminate at such time.
(b) By their acceptance of the Residual Certificates, the Holders
thereof hereby (i) agree to adopt such a plan of complete liquidation of REMIC I
and REMIC II upon the written request of the Depositor or ▇▇▇▇▇▇▇▇▇, as
applicable, and to take such action in connection therewith as may be reasonably
requested by the Depositor or ▇▇▇▇▇▇▇▇▇, as applicable, and (ii) appoint the
Securities Administrator as their attorney-in-fact, with full power of
substitution, for purposes of adopting such a plan of complete liquidation. The
Trustee shall adopt such plan of liquidation by filing the appropriate statement
on the final tax return of each REMIC. Upon complete liquidation or final
distribution of all of the assets of the Trust, the Trust and each of REMIC I
and REMIC II shall terminate.
ARTICLE XI
Miscellaneous Provisions
Section 11.01 INTENT OF PARTIES. The parties intend that each of REMIC
I and REMIC II shall be treated as a REMIC for federal income tax purposes and
that the provisions of this Agreement should be construed in furtherance of this
intent.
Section 11.02 AMENDMENT. (a) This Agreement may be amended from time
to time by the Depositor, ▇▇▇▇▇▇▇▇▇, the Master Servicer, the Securities
Administrator, the Delaware Trustee and the Trustee, and the Servicing
Agreements may be amended from time to time by the parties thereto with the
consent of ▇▇▇▇▇▇▇▇▇ and the Master Servicer, and the acknowledgement of the
Trustee in each case if they are not parties thereto, without notice to or the
consent of any of the Certificateholders, to cure any ambiguity, to correct or
supplement any provisions herein or therein that may be defective or
inconsistent with any other provisions herein or therein, to comply with any
changes in the Code, to conform the provisions hereof to the disclosure in the
Prospectus Supplement or to make any other provisions with respect to matters or
questions arising under this Agreement which shall not be inconsistent with the
provisions of this Agreement; provided, however, that such action shall not, as
evidenced by an Opinion of Independent Counsel, addressed to the Trustee,
adversely affect in any material respect the interests of any Certificateholder.
(b) This Agreement may also be amended from time to time by the
Depositor, ▇▇▇▇▇▇▇▇▇, the Master Servicer, the Securities Administrator, the
Delaware Trustee and the Trustee, and the Servicing Agreements may be amended
from time to time by the parties thereto with the consent of ▇▇▇▇▇▇▇▇▇ and the
Master Servicer, and the acknowledgement of the Trustee in each case if they are
not parties thereto and as to amendments to this Agreement, with the consent of
the Holders of Certificates evidencing Fractional Undivided Interests
aggregating not less than 51% of the Trust or of the applicable Class or
Classes, if such amendment affects only such Class or Classes, for the purpose
of adding any provisions to or changing in any manner or eliminating any of the
provisions of this Agreement or of modifying in any manner the rights of the
Certificateholders; provided, however, that no such amendment shall (i) reduce
in any manner the amount of, or delay the timing of, payments received on
Mortgage Loans which are required to be distributed on any Certificate without
the consent of the Holder of such Certificate, (ii) reduce the aforesaid
percentage of Certificates the Holders of which are required to consent to any
such amendment, without the consent of the Holders of all Certificates then
outstanding, or (iii) cause REMIC I or REMIC II to fail to qualify as a REMIC
for federal income tax purposes, as evidenced by an Opinion of Independent
Counsel which shall be provided to the Trustee other than at the Trustee's
expense. Notwithstanding any other provision of this Agreement, for purposes of
the giving or withholding of consents pursuant to Section 11.02(b), Certificates
registered in the name of or held for the benefit of the Depositor, the
Securities Administrator, the Master Servicer, the Delaware Trustee, the
Custodian or the Trustee or any Affiliate thereof shall be entitled to vote
their Fractional Undivided Interests with respect to matters affecting such
Certificates.
(c) Promptly after the execution of any such amendment, the Trustee
shall furnish a copy of such amendment or written notification of the substance
of such amendment to each Certificateholder, with a copy to each Rating Agency.
(d) In the case of an amendment under Subsection 11.02(b) above, it
shall not be necessary for the Certificateholders to approve the particular form
of such an amendment. Rather, it shall be sufficient if the Certificateholders
approve the substance of the amendment. 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.
(e) Prior to the execution of any amendment to this Agreement, the
Trustee shall be entitled to receive and rely upon an Opinion of Counsel stating
that the execution of such amendment is authorized or permitted by this
Agreement. The Trustee and the Securities Administrator may, but shall not be
obligated to, enter into any such amendment which affects the Trustee's or the
Securities Administrator's own respective rights, duties, indemnities or
immunities under this Agreement.
Section 11.03 RECORDATION OF AGREEMENT. To the extent permitted by
applicable law, this Agreement is subject to recordation in all appropriate
public offices for real property records in all the counties or other comparable
jurisdictions in which any or all of the Mortgaged Properties are situated, and
in any other appropriate public recording office or elsewhere. The Depositor
shall effect such recordation, at the expense of the Trust upon the request in
writing of a Certificateholder, but only if such direction is accompanied by an
Opinion of Counsel (provided at the expense of the Certificateholder requesting
recordation) to the effect that such recordation would materially and
beneficially affect the interests of the Certificateholders or is required by
law.
Section 11.04 LIMITATION ON RIGHTS OF CERTIFICATEHOLDERS. (a) The
death or incapacity of any Certificateholder shall not terminate this Agreement
or the Trust, nor entitle such Certificateholder's legal representatives or
heirs to claim an accounting or to take any action or proceeding in any court
for a partition or winding up of the Trust, nor otherwise affect the rights,
obligations and liabilities of the parties hereto or any of them.
(b) Except as expressly provided in this Agreement, no
Certificateholders shall have any right to vote or in any manner otherwise
control the operation and management of the Trust, or the obligations of the
parties hereto, nor shall anything herein set forth, or contained in the terms
of the Certificates, be construed so as to establish the Certificateholders from
time to time as partners or members of an association; nor shall any
Certificateholders be under any liability to any third Person by reason of any
action taken by the parties to this Agreement pursuant to any provision hereof.
(c) No Certificateholder shall have any right by virtue of any
provision of this Agreement to institute any suit, action or proceeding in
equity or at law upon, under or with respect to this Agreement against the
Depositor, ▇▇▇▇▇▇▇▇▇, the Securities Administrator, the Master Servicer or any
successor to any such parties unless (i) such Certificateholder previously shall
have given to the Trustee a written notice of a continuing default, as herein
provided, (ii) the Holders of Certificates evidencing Fractional Undivided
Interests aggregating not less than 51% of the Trust shall have made written
request upon the Trustee to institute such action, suit or proceeding in its own
name as Trustee hereunder and shall have offered to the Trustee such reasonable
indemnity as it may require against the costs and expenses and liabilities to be
incurred therein or thereby, and (iii) 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.
(d) No one or more Certificateholders shall have any right by virtue
of any provision of this Agreement to affect the rights of any other
Certificateholders or to obtain or seek to obtain priority or preference over
any other such Certificateholder, or to enforce any right under this Agreement,
except in the manner herein provided and for the equal, ratable and common
benefit of all Certificateholders. For the protection and enforcement of the
provisions of this Section 11.04, each and every Certificateholder and the
Trustee shall be entitled to such relief as can be given either at law or in
equity.
Section 11.05 ACTS OF CERTIFICATEHOLDERS. (a) Any request, demand,
authorization, direction, notice, consent, waiver or other action provided by
this Agreement to be given or taken by Certificateholders may be embodied in and
evidenced by one or more instruments of substantially similar tenor signed by
such Certificateholders in person or by an agent duly appointed in writing.
Except as herein otherwise expressly provided, such action shall become
effective when such instrument or instruments are delivered to the Trustee and,
where it is expressly required, to the Depositor. Proof of execution of any such
instrument or of a writing appointing any such agent shall be sufficient for any
purpose of this Agreement and conclusive in favor of the Trustee and the
Depositor, if made in the manner provided in this Section 11.05.
(b) The fact and date of the execution by any Person of any such
instrument or writing may be proved by the affidavit of a witness of such
execution or by a certificate of a notary public or other officer authorized by
law to take acknowledgments of deeds, certifying that the individual signing
such instrument or writing acknowledged to him the execution thereof. Where such
execution is by a signer acting in a capacity other than his or her individual
capacity, such certificate or affidavit shall also constitute sufficient proof
of his or her authority. The fact and date of the execution of any such
instrument or writing, or the authority of the individual executing the same,
may also be proved in any other manner which the Trustee deems sufficient.
(c) The ownership of Certificates (notwithstanding any notation of
ownership or other writing on such Certificates, except an endorsement in
accordance with Section 5.02 made on a Certificate presented in accordance with
Section 5.04) shall be proved by the Certificate Register, and neither the
Trustee, the Delaware Trustee, the Custodian, the Securities Administrator, the
Depositor, ▇▇▇▇▇▇▇▇▇, the Master Servicer nor any successor to any such parties
shall be affected by any notice to the contrary.
(d) Any request, demand, authorization, direction, notice, consent,
waiver or other action of the holder of any Certificate shall bind every future
holder of the same Certificate and the holder of every Certificate issued upon
the registration of transfer or exchange thereof, if applicable, or in lieu
thereof with respect to anything done, omitted or suffered to be done by the
Trustee, the Delaware Trustee, the Custodian, the Securities Administrator, the
Depositor, ▇▇▇▇▇▇▇▇▇, the Master Servicer or any successor to any such party in
reliance thereon, whether or not notation of such action is made upon such
Certificates.
(e) In determining whether the Holders of the requisite percentage of
Certificates evidencing Fractional Undivided Interests have given any request,
demand, authorization, direction, notice, consent or waiver hereunder,
Certificates owned by the Trustee, the Delaware Trustee, the Custodian, the
Securities Administrator, the Depositor, the Master Servicer or any Affiliate
thereof shall be disregarded, except as otherwise provided in Section 11.02(b)
and except that, in determining whether the Trustee shall be protected in
relying upon any such request, demand, authorization, direction, notice, consent
or waiver, only Certificates which the Trustee knows to be so owned shall be so
disregarded. Certificates which have been pledged in good faith to the Trustee,
the Delaware Trustee, the Custodian, the Securities Administrator, the
Depositor, the Master Servicer or any Affiliate thereof may be regarded as
outstanding if the pledgor establishes to the satisfaction of the Trustee the
pledgor's right to act with respect to such Certificates and that the pledgor is
not an Affiliate of the Trustee, the Delaware Trustee, the Custodian, the
Securities Administrator, the Depositor, or the Master Servicer, as the case may
be.
Section 11.06 GOVERNING LAW. THIS AGREEMENT AND THE CERTIFICATES SHALL
BE CONSTRUED IN ACCORDANCE WITH THE LAWS OF THE STATE OF DELAWARE WITHOUT
REFERENCE TO ITS CONFLICT OF LAWS RULES AND THE OBLIGATIONS, RIGHTS AND REMEDIES
OF THE PARTIES HEREUNDER SHALL BE DETERMINED IN ACCORDANCE WITH SUCH LAWS.
Section 11.07 NOTICES. All demands and notices hereunder shall be in
writing and shall be deemed given when delivered at (including delivery by
facsimile) or mailed by registered mail, return receipt requested, postage
prepaid, or by recognized overnight courier, to (i) in the case of the
Depositor, ▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇ ▇▇▇▇▇, ▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇, Attention:
Vice President-Servicing, telecopier number: (▇▇▇) ▇▇▇-▇▇▇▇, or to such other
address as may hereafter be furnished to the other parties hereto in writing;
(ii) in the case of the Trustee, at its Corporate Trust Office, or such other
address as may hereafter be furnished to the other parties hereto in writing;
(iii) in the case of Thornburg, ▇▇▇ ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇, ▇▇▇▇▇ ▇▇, ▇▇▇
▇▇▇▇▇▇ ▇▇▇▇▇, Attention: ▇▇▇▇▇▇▇ ▇▇▇▇▇, Vice President--Mortgage Loan
Securitization, telecopier number: (▇▇▇) ▇▇▇-▇▇▇▇, or to such other address as
may hereafter be furnished to the other parties hereto in writing; (iv) in the
case of the Master Servicer or Securities Administrator, ▇▇▇▇▇ Fargo Bank, N.A.,
▇.▇. ▇▇▇ ▇▇, ▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇ ▇▇▇▇▇ (or, in the case of overnight deliveries,
▇▇▇▇ ▇▇▇ ▇▇▇▇▇▇▇▇▇ ▇▇▇▇, ▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇ ▇▇▇▇▇), Attention: ▇▇▇▇▇▇▇▇▇/▇▇▇▇ ▇▇
2004-1, facsimile no.: (▇▇▇) ▇▇▇-▇▇▇▇, or such other address as may hereafter be
furnished to the other parties hereto in writing; (v) in the case of the
Delaware Trustee, ▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇, ▇▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇ ▇▇▇▇▇,
Attention: ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇, facsimile no. (▇▇▇) ▇▇▇-▇▇▇▇ or such other address
as may hereafter be furnished to the other parties hereto in writing; (vi) in
the case of Moody's, ▇▇▇▇▇'▇ Investors Service, Inc., ▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇
▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇, Attention: RMBS Monitoring Department, facsimile no.:
(▇▇▇) ▇▇▇-▇▇▇▇ or such other address as may hereafter be furnished to the other
parties hereto in writing; (vii) in the case of S&P, Standard & Poor's, ▇▇ ▇▇▇▇▇
▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇ Attention: ▇▇▇▇▇ ▇▇▇, facsimile no.: (212)
438-2661 or such other address as may hereafter be furnished to the other
parties hereto in writing; or (viii) in the case of TMI, ▇▇▇ ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇,
▇▇▇▇▇ ▇▇▇, ▇▇▇▇▇ ▇▇, ▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇, Attention: ▇▇▇▇▇▇▇ ▇▇▇▇▇, or to such
other address as may hereafter be furnished to the other parties hereto in
writing. Any notice delivered to the Depositor, ▇▇▇▇▇▇▇▇▇, TMI, the Master
Servicer, the Securities Administrator, the Delaware Trustee or the Trustee
under this Agreement shall be effective only upon receipt. Any notice required
or permitted to be mailed to a Certificateholder, unless otherwise provided
herein, shall be given by first-class mail, postage prepaid, at the address of
such Certificateholder as shown in the Certificate Register. Any notice so
mailed within the time prescribed in this Agreement shall be conclusively
presumed to have been duly given when mailed, whether or not the
Certificateholder receives such notice.
Section 11.08 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 severed from the remaining covenants, agreements,
provisions or terms of this Agreement and shall in no way affect the validity or
enforceability of the other provisions of this Agreement or of the Certificates
or the rights of the holders thereof.
Section 11.09 SUCCESSORS AND ASSIGNS. The provisions of this Agreement
shall be binding upon and inure to the benefit of the respective successors and
assigns of the parties hereto.
Section 11.10 ARTICLE AND SECTION HEADINGS. The article and section
headings herein are for convenience of reference only, and shall not limit or
otherwise affect the meaning hereof.
Section 11.11 COUNTERPARTS. This Agreement may be executed in two or
more counterparts each of which when so executed and delivered shall be an
original but all of which together shall constitute one and the same instrument.
Section 11.12 NOTICE TO RATING AGENCIES. The article and section
headings herein are for convenience of reference only, and shall not limited or
otherwise affect the meaning hereof. The Trustee shall 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 or the
Servicing Agreements;
(ii) The occurrence of any Event of Default that has not been
cured;
(iii) The resignation or termination of the Master Servicer, the
Trustee, the Delaware Trustee, the Custodian or the Securities
Administrator;
(iv) The repurchase or substitution of Mortgage Loans;
(v) The final payment to Certificateholders; and
(vi) Any change in the location of the Master Servicer Collection
Account or the Distribution Account.
Section 11.13 DERIVATIVE TRANSACTIONS. The Trust and the Trustee are
authorized, at the direction and the expense of the Holders of a majority of the
Fractional Undivided Interests of the Class B-IO Certificates, to enter into
such derivative transactions for the benefit of any Certificateholders as may be
deemed desirable by such Holders of the Class B-IO Certificates, so long as (i)
as evidenced by one or more Opinions of Counsel addressed to the Trustee (at the
expense of such Holders), the execution and delivery of such derivative
transaction is permitted under this Agreement and the inclusion of such
derivative in the Trust will not be inconsistent with the ERISA provisions
contained herein or cause the Certificates (other than the Class B-IO
Certificates and Class R Certificates) to fail to qualify for Prohibited
Transaction Exemption 90-30, as amended, (ii) a REMIC Opinion (at the expense of
such Holders) is delivered to the Trustee, (iii) an Opinion of Counsel addressed
to the Trustee (at the expense of such Holders) that the execution and delivery
of such derivative transaction and documentation as presented to the Trustee is
permitted under this Agreement, and (iv) each Rating Agency shall have confirmed
in writing that the inclusion of such derivative would not result in a downgrade
of its then rating of any Class of Certificates.
IN WITNESS WHEREOF, the Depositor, the Trustee (as trustee and as
custodian), the Delaware Trustee, the Master Servicer, the Securities
Administrator and ▇▇▇▇▇▇▇▇▇ have caused their names to be signed hereto by their
respective officers thereunto duly authorized as of the day and year first above
written.
STRUCTURED ASSET MORTGAGE
INVESTMENTS II INC., as Depositor
By: /s/ ▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇
------------------------------
Name: ▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇
Title: Vice President
DEUTSCHE BANK NATIONAL TRUST
COMPANY, as Trustee
By: /s/ ▇▇▇▇▇▇ ▇▇▇▇▇▇▇
------------------------------
Name: ▇▇▇▇▇▇ ▇▇▇▇▇▇▇
Title: Associate
By: /s/ ▇▇▇▇ ▇▇▇▇▇
------------------------------
Name: ▇▇▇▇ ▇▇▇▇▇
Title: Associate
DEUTSCHE BANK TRUST COMPANY
DELAWARE, as Delaware Trustee
By: /s/ ▇▇▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇
------------------------------
Name: ▇▇▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇
Title: Assistant Vice President
▇▇▇▇▇ FARGO BANK, N.A., as Master
Servicer
By: /s/ ▇▇▇ ▇▇▇▇▇
------------------------------
Name: ▇▇▇ ▇▇▇▇▇
Title: Vice President
▇▇▇▇▇ FARGO BANK, N.A., as Securities
Administrator
By: /s/ ▇▇▇ ▇▇▇▇▇
------------------------------
Name: ▇▇▇ ▇▇▇▇▇
Title: Vice President
▇▇▇▇▇▇▇▇▇ MORTGAGE HOME LOANS, INC.
By: /s/ ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇
------------------------------
Name: ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇
Title: Vice President
Accepted and agreed
as to Sections 3.21, 5.09 and 11.07
▇▇▇▇▇▇▇▇▇ MORTGAGE, INC.
By: /s/ ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇
-----------------------------
Name: ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇
Title: Vice President
STATE OF NEW YORK )
) ss:
COUNTY OF NEW YORK )
On the 31st day of March, 2004 before me, a notary public in and for
said State, personally appeared ▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇, known to me to be a Vice
President of Structured Asset Mortgage Investments II Inc., the corporation that
executed the within instrument, and also known to me to be the person who
executed it on behalf of said corporation, and acknowledged to me that such
corporation executed the within instrument.
IN WITNESS WHEREOF, I have hereunto set my hand and affixed my
official seal the day and year in this certificate first above written.
/s/ ▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇▇
-----------------------
Notary Public
[Notarial Seal]
STATE OF CALIFORNIA )
) ss:
COUNTY OF ORANGE )
On the 31st day of March, 2004 before me, a notary public in and for
said State, personally appeared ▇▇▇▇▇▇ ▇▇▇▇▇▇▇, known to me to be an Associate
of Deutsche Bank National Trust Company, the national banking association that
executed the within instrument, and also known to me to be the person who
executed it on behalf of said corporation, and acknowledged to me that such
corporation executed the within instrument.
IN WITNESS WHEREOF, I have hereunto set my hand and affixed my
official seal the day and year in this certificate first above written.
/s/ Hang ▇. ▇▇▇
-------------------
Notary Public
[Notarial Seal]
STATE OF CALIFORNIA )
) ss:
COUNTY OF ORANGE )
On the 31st day of March, 2004 before me, a notary public in and for
said State, personally appeared ▇▇▇▇ ▇▇▇▇▇, known to me to be an Associate of
Deutsche Bank National Trust Company, the national banking association that
executed the within instrument, and also known to me to be the person who
executed it on behalf of said corporation, and acknowledged to me that such
corporation executed the within instrument.
IN WITNESS WHEREOF, I have hereunto set my hand and affixed my
official seal the day and year in this certificate first above written.
/s/ Hang ▇. ▇▇▇
------------------------
Notary Public
[Notarial Seal]
STATE OF DELAWARE )
) ss:
COUNTY OF NEW CASTLE )
On the 31st day of March, 2004 before me, a notary public in and for
said State, personally appeared ▇▇▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇, known to me to be a Vice
President of Deutsche Bank Trust Company Delaware, the Delaware banking
corporation that executed the within instrument, and also known to me to be the
person who executed it on behalf of said corporation, and acknowledged to me
that such corporation executed the within instrument.
IN WITNESS WHEREOF, I have hereunto set my hand and affixed my
official seal the day and year in this certificate first above written.
/s/ ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇
--------------------------
Notary Public
[Notarial Seal]
STATE OF MARYLAND )
) ss:
COUNTY OF ▇▇▇▇▇▇ )
On the 31st day of March, 2004 before me, a notary public in and for
said State, personally appeared ▇▇▇ ▇▇▇▇▇, known to me to be a Vice President of
▇▇▇▇▇ Fargo Bank, N.A., the national banking association that executed the
within instrument, and also known to me to be the person who executed it on
behalf of said corporation, and acknowledged to me that such corporation
executed the within instrument.
IN WITNESS WHEREOF, I have hereunto set my hand and affixed my
official seal the day and year in this certificate first above written.
/s/ ▇▇▇▇▇ ▇▇▇▇▇▇
------------------------
Notary Public
[Notarial Seal]
STATE OF NEW MEXICO )
) ss:
COUNTY OF SANTA FE )
On the 31st day of March, 2004 before me, a notary public in and for
said State, personally appeared ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇, known to me to be a Vice
President of ▇▇▇▇▇▇▇▇▇ Mortgage Home Loans, Inc., the corporation that executed
the within instrument, and also known to me to be the person who executed it on
behalf of said corporation, and acknowledged to me that such corporation
executed the within instrument.
IN WITNESS WHEREOF, I have hereunto set my hand and affixed my
official seal the day and year in this certificate first above written.
/s/ ▇▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇
---------------------------
Notary Public
[Notarial Seal]
EXHIBIT A-1
FORM OF CLASS [__-__A] CERTIFICATE
SOLELY FOR U.S. FEDERAL INCOME TAX PURPOSES, THIS CERTIFICATE IS A
"REGULAR INTEREST" IN A "REAL ESTATE MORTGAGE INVESTMENT CONDUIT," AS THOSE
TERMS ARE DEFINED, RESPECTIVELY, IN SECTIONS 860G AND 860D OF THE INTERNAL
REVENUE CODE OF 1986 (THE "CODE").
THE CURRENT PRINCIPAL AMOUNT OF THIS CERTIFICATE WILL BE DECREASED BY
THE PRINCIPAL PAYMENTS HEREON. ACCORDINGLY, FOLLOWING THE INITIAL ISSUANCE OF
THE CERTIFICATES, THE CURRENT PRINCIPAL AMOUNT OF THIS CERTIFICATE WILL BE
DIFFERENT FROM THE DENOMINATION SHOWN BELOW. ANYONE ACQUIRING THIS CERTIFICATE
MAY ASCERTAIN ITS CURRENT PRINCIPAL AMOUNT BY INQUIRY OF THE TRUSTEE NAMED
HEREIN.
UNLESS THIS CERTIFICATE IS PRESENTED BY AN AUTHORIZED REPRESENTATIVE
OF THE DEPOSITORY TRUST COMPANY, A NEW YORK CORPORATION ("DTC"), TO THE TRUSTEE
OR ITS AGENT FOR REGISTRATION OF TRANSFER, EXCHANGE OR PAYMENT, AND ANY
CERTIFICATE ISSUED IS REGISTERED IN THE NAME OF CEDE & CO. OR 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.
Certificate No. [__-__A-_] [Adjustable Pass-Through Rate]
[Variable Pass-Through Rate]
Class [__-__A]
Cut-off Date: Aggregate Initial Current
March 1, 2004 Principal Amount of this
Class as of the Cut-off Date:
$___________
First Distribution Date: April 25, 2004 Initial Current Principal
Amount of this Certificate as
of the Cut-off Date:
$__________
Master Servicer: ▇▇▇▇▇ Fargo Bank, N.A. CUSIP: [I-1A - 885220 ET 6]
[I-2A - 885220 EU 3]
[II-1A- 885220 EV 1]
[II-2A- 885220 EW 9]
[II-3A- 885220 EX 7]
[II-4A- 885220 EY 5]
Trustee: Deutsche Bank National Trust Company Assumed Final Distribution
Date: ▇▇▇▇▇ ▇▇, ▇▇▇▇
▇▇▇▇▇▇▇▇▇ MORTGAGE SECURITIES TRUST 2004-1
MORTGAGE PASS-THROUGH CERTIFICATE SERIES 2004-1
evidencing a fractional undivided interest in the distributions
allocable to the Class [__-__A] Certificates issued by ▇▇▇▇▇▇▇▇▇
Mortgage Securities Trust 2004-1, a Delaware statutory trust (the
"Trust") consisting primarily of a pool of one- to four-family,
first lien, hybrid and adjustable interest rate mortgage loans
(the "Mortgage Loans").
This Certificate is payable solely from the assets of the Trust, and
does not represent an obligation of or interest in ▇▇▇▇ ▇▇, the Master Servicer,
the Securities Administrator, ▇▇▇▇▇▇▇▇▇, the Delaware Trustee or the Trustee
(each as defined below) or any of their affiliates or any other person. Neither
this Certificate nor the underlying Mortgage Loans are guaranteed or insured by
any governmental entity or by ▇▇▇▇ ▇▇, the Master Servicer, the Securities
Administrator, ▇▇▇▇▇▇▇▇▇, the Delaware Trustee or the Trustee or any of their
affiliates or any other person.
This certifies that CEDE & CO. is the registered owner of the
Fractional Undivided Interest evidenced hereby in the beneficial ownership
interest of Certificates of the same Class as this Certificate in the Trust,
which was created pursuant to the Trust, Pooling and Servicing Agreement dated
as of March 1, 2004 (the "Agreement"), among Structured Asset Mortgage
Investments II Inc. ("▇▇▇▇ ▇▇"), as depositor (the "Depositor"), ▇▇▇▇▇ Fargo
Bank, N.A. as master servicer (the "Master Servicer") and securities
administrator (the "Securities Administrator"), Deutsche Bank National Trust
Company, as trustee (the "Trustee"), Deutsche Bank Trust Company Delaware, as
Delaware trustee (the "Delaware Trustee") and ▇▇▇▇▇▇▇▇▇ Mortgage Home Loans,
Inc. ("▇▇▇▇▇▇▇▇▇"), a summary of certain of the pertinent provisions of which is
set forth hereafter. The Mortgage Loans were sold by ▇▇▇▇▇▇▇▇▇ to ▇▇▇▇ ▇▇
pursuant to the Mortgage Loan Purchase Agreement, dated as of March 1, 2004, and
from ▇▇▇▇ ▇▇ to the Trust pursuant to the Agreement. To the extent not defined
herein, capitalized terms used herein shall have the meaning ascribed to them 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 its acceptance hereof assents and by which such
Holder is bound.
Interest on this Certificate will accrue for each Distribution Date
during the preceding Interest Accrual Period in an amount equal to the product
of (i) 1/12th, (ii) the Class [__-__A] Pass-Through Rate and (iii) the Current
Principal Amount hereof immediately prior to such Distribution Date. The Trustee
will distribute on the 25th day of each month, or, if such 25th day is not a
Business Day, the immediately following Business Day (each, a "Distribution
Date"), commencing on the first Distribution Date specified above, to the Person
in whose name this Certificate is registered on the applicable Record Date, an
amount equal to the product of the Fractional Undivided Interest evidenced by
this Certificate and the amount (of interest and principal, if any) required to
be distributed to the Holders of Certificates of the same Class as this
Certificate. The Assumed Final Distribution Date is the Distribution Date in the
month immediately following the month of the latest scheduled maturity date of
any Mortgage Loan and is not likely to be the date on which the Current
Principal Amount of this Class of Certificates will be reduced to zero.
Distributions on this Certificate will be made by the Trustee by check
mailed to the address of the Person entitled thereto as such name and address
shall appear on the Certificate Register or, if such Person so requests by
notifying the Trustee in writing as specified in the Agreement by wire transfer.
Notwithstanding the above, the final distribution on this Certificate will be
made after due notice by the Trustee of the pendency of such distribution and
only upon presentation and surrender of this Certificate at the office or agency
appointed by the Trustee for that purpose and designated in such notice.
Notwithstanding the forgoing, if this Certificate is a Book-Entry Certificate,
subject to the immediately preceding sentence regarding final distributions on
this Certificate, distributions shall be made to the Depository by wire transfer
in immediately available funds. The initial Current Principal Amount of this
Certificate is set forth above. The Current Principal Amount hereof will be
reduced to the extent of distributions allocable to principal hereon.
This Certificate is one of a duly authorized issue of Certificates
designated as set forth on the face hereof (the "Certificates"), issued in
eleven Classes. The Certificates, in the aggregate, evidence the entire
beneficial ownership interest in the Trust formed pursuant to the Trust
Agreement, dated as of March 29, 2004, among ▇▇▇▇ ▇▇, the Trustee and the
Delaware Trustee.
The Certificateholder, by its acceptance of this Certificate, agrees
that it will look solely to the Trust for payment hereunder and no other party
to the Agreement is 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 hereby, and the rights,
duties and immunities of the Trustee.
The Agreement permits, with certain exceptions therein provided, the
amendment thereof by the Depositor, ▇▇▇▇▇▇▇▇▇, the Master Servicer, the
Securities Administrator, the Delaware Trustee and the Trustee with the consent
of the Holders of Certificates evidencing Fractional Undivided Interests
aggregating not less than 51% of the Trust (or, if such amendment affects only
one or more classes, of such Class or Classes). 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 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 with the
Trustee upon surrender of this Certificate for registration of transfer at the
offices or agencies maintained by the Trustee for such purposes, accompanied by
an executed written instrument of assignment and transfer in form and substance
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
in authorized denominations representing a like aggregate Fractional Undivided
Interest will be issued to the designated transferee.
The Certificates are issuable only as registered Certificates without
coupons in the Classes and denominations specified in the Agreement. As provided
in the Agreement and subject to certain limitations therein set forth, this
Certificate is exchangeable for one or more new Certificates evidencing the same
Class and in the same aggregate Fractional Undivided Interest, as requested by
the Holder surrendering the same.
No service charge will be made to the Certificateholders for any such
registration of transfer, but the Trustee may require payment of a sum
sufficient to cover any tax or other governmental charge payable in connection
therewith. ▇▇▇▇ ▇▇, the Master Servicer, the Securities Administrator,
▇▇▇▇▇▇▇▇▇, the Delaware Trustee and the Trustee and any successor of any of them
may treat the Person in whose name this Certificate is registered as the owner
hereof for all purposes, and none of ▇▇▇▇ ▇▇, the Master Servicer, the
Securities Administrator, ▇▇▇▇▇▇▇▇▇, the Delaware Trustee or the Trustee or any
such successor shall be affected by notice to the contrary.
The obligations created by the Agreement and the Trust created thereby
(other than the obligations to make payments to Certificateholders with respect
to the termination of the Agreement) shall terminate upon the earlier of (i) the
later of the (A) final payment or other liquidation (or Advance with respect
thereto) of the last Mortgage Loan remaining in the Trust and (B) disposition of
all property acquired upon foreclosure or deed in lieu of foreclosure of any
Mortgage Loan and the remittance of all funds due under the Agreement, (ii) the
optional repurchase by ▇▇▇▇▇▇▇▇▇ of all the Mortgage Loans and other assets of
the Trust in accordance with the terms of the Agreement or (iii) the payment to
Certificateholders of all amounts required to be paid to them pursuant to the
Agreement. Such optional repurchase may be made only on or after the
Distribution Date on which the aggregate Scheduled Principal Balance of the
Mortgage Loans is less than the percentage of the aggregate Outstanding
Principal Balance specified in the Agreement of the Mortgage Loans at the
Cut-off Date. The exercise of such right will effect the early retirement of the
Certificates.
▇▇▇▇▇▇▇▇▇ Mortgage, Inc. ("TMI") has the right to effect early
retirement of this Certificate by exercising its Optional Securities Purchase
Right on any Distribution Date on or after the Distribution Date on which the
aggregate Scheduled Principal Balance of the Mortgage Loans as of the end of the
immediately preceding Due Period is equal to or less than 20% of the Cut-off
Date Balance thereof, as set forth in Section 5.09 of the Agreement. The Holder
of this Certificate shall be entitled to receive an amount equal to Current
Interest, principal and any Interest Carry-Forward Amount allocable to this
Certificate as specified in the Agreement. Following exercise of the Optional
Securities Purchase Right by TMI, this Certificate shall be deemed cancelled.
Unless this Certificate has been authenticated by an authorized
signatory of the Trustee by manual signature, this Certificate shall not be
entitled to any benefit under the Agreement, or be valid for any purpose.
IN WITNESS WHEREOF, the Trustee has caused this Certificate to be duly
executed.
Dated: _______________ DEUTSCHE BANK NATIONAL TRUST COMPANY
Not in its individual capacity but solely as
Trustee
By:
-----------------------
Authorized Signatory
CERTIFICATE OF AUTHENTICATION
This is one of the Class [__-__A] Certificates referred to in the
within-mentioned Agreement.
DEUTSCHE BANK NATIONAL TRUST COMPANY
Authorized signatory of Deutsche Bank
National Trust Company, not
in its individual capacity but solely as
Trustee
By:
-----------------------
Authorized Signatory
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) a Fractional Undivided
Interest evidenced by the Mortgage Pass-Through Certificate and hereby
authorizes the transfer of registration of such interest to assignee on the
Certificate Register of the Trust.
I (We) further direct the Certificate Registrar to issue a new
Certificate of a like denomination and Class, to the above named assignee and
deliver such Certificate to the following address:
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Dated: _________________________________________
Signature by or on behalf of assignor
_________________________________________
Signature Guaranteed
DISTRIBUTION INSTRUCTIONS
The assignee should include the following for purposes of
distribution:
Distributions shall be made, by wire transfer or otherwise, in
immediately available funds to _________________________________ for the account
of _________________________ account number _____________, or, if mailed by
check, to ______________________________. Applicable statements should be mailed
to _____________________________________________.
This information is provided by__________________, the assignee named
above, or ________________________, as its agent.
Exhibit A-2
CLASS [__-M] CERTIFICATE
SOLELY FOR U.S. FEDERAL INCOME TAX PURPOSES, THIS CERTIFICATE IS A
"REGULAR INTEREST" IN A "REAL ESTATE MORTGAGE INVESTMENT CONDUIT," AS THOSE
TERMS ARE DEFINED, RESPECTIVELY, IN SECTIONS 860G AND 860D OF THE INTERNAL
REVENUE CODE OF 1986, AS AMENDED (THE "CODE").
THE CURRENT PRINCIPAL AMOUNT OF THIS CERTIFICATE WILL BE DECREASED BY
THE PRINCIPAL PAYMENTS HEREON AND REALIZED LOSSES ALLOCABLE HERETO. ACCORDINGLY,
FOLLOWING THE INITIAL ISSUANCE OF THE CERTIFICATES, THE CURRENT PRINCIPAL AMOUNT
OF THIS CERTIFICATE WILL BE DIFFERENT FROM THE DENOMINATION SHOWN BELOW. ANYONE
ACQUIRING THIS CERTIFICATE MAY ASCERTAIN ITS CURRENT PRINCIPAL AMOUNT BY INQUIRY
OF THE TRUSTEE NAMED HEREIN.
UNLESS THIS CERTIFICATE IS PRESENTED BY AN AUTHORIZED REPRESENTATIVE
OF THE DEPOSITORY TRUST COMPANY, A NEW YORK CORPORATION ("DTC"), TO THE TRUSTEE
OR ITS AGENT FOR REGISTRATION OF TRANSFER, EXCHANGE OR PAYMENT, AND ANY
CERTIFICATE ISSUED IS REGISTERED IN THE NAME OF CEDE & CO. OR 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.
Certificate No. [__-M-__] [Adjustable Pass-Through Rate]
[Variable Pass-Through Rate]
Class [__-M]
Cut-off Date: Aggregate Initial Current
March 1, 2004 Principal Amount of this
Class as of the Cut-off Date:
$__________
First Distribution Date: April 25, 2004 Initial Current Principal
Amount of this Certificate as
of the Cut-off Date: $_______
Master Servicer: ▇▇▇▇▇ Fargo Bank, N.A. CUSIP: [I-M - 885220 EZ 2]
[II-M - 885220 FA 6]
Trustee: Deutsche Bank National Trust Company Assumed Final Distribution
Date: ▇▇▇▇▇ ▇▇, ▇▇▇▇
▇▇▇▇▇▇▇▇▇ MORTGAGE SECURITIES TRUST 2004-1
MORTGAGE PASS-THROUGH CERTIFICATES SERIES 2004-1
evidencing a fractional undivided interest in the distributions
allocable to the Class [__-M] Certificates issued by ▇▇▇▇▇▇▇▇▇
Mortgage Securities Trust 2004-1, a Delaware statutory trust (the
"Trust") consisting primarily of a pool of one- to four-family, first
lien, hybrid and adjustable interest rate mortgage loans (the
"Mortgage Loans").
This Certificate is payable solely from the assets of the Trust, and
does not represent an obligation of or interest in ▇▇▇▇ ▇▇, the Master Servicer,
the Securities Administrator, ▇▇▇▇▇▇▇▇▇, the Delaware Trustee or the Trustee
(each as defined below) or any of their affiliates or any other person. Neither
this Certificate nor the underlying Mortgage Loans are guaranteed or insured by
any governmental entity or by ▇▇▇▇ ▇▇, the Master Servicer, the Securities
Administrator, ▇▇▇▇▇▇▇▇▇, the Delaware Trustee or the Trustee or any of their
affiliates or any other person.
This certifies that __________ is the registered owner of the
Fractional Undivided Interest evidenced hereby in the beneficial ownership
interest of Certificates of the same Class as this Certificate in the Trust,
which was created pursuant to the Trust, Pooling and Servicing Agreement dated
as of March 1, 2004 (the "Agreement"), among Structured Asset Mortgage
Investments II Inc. ("▇▇▇▇ ▇▇"), as depositor (the "Depositor"), ▇▇▇▇▇ Fargo
Bank, N.A. as master servicer (the "Master Servicer") and securities
administrator (the "Securities Administrator"), Deutsche Bank National Trust
Company, as trustee (the "Trustee"), Deutsche Bank Trust Company Delaware, as
Delaware trustee (the "Delaware Trustee") and ▇▇▇▇▇▇▇▇▇ Mortgage Home Loans,
Inc. ("▇▇▇▇▇▇▇▇▇"), a summary of certain of the pertinent provisions of which is
set forth hereafter. The Mortgage Loans were sold by ▇▇▇▇▇▇▇▇▇ to ▇▇▇▇ ▇▇
pursuant to the Mortgage Loan Purchase Agreement, dated as of March 1, 2004, and
from ▇▇▇▇ ▇▇ to the Trust pursuant to the Agreement. To the extent not defined
herein, capitalized terms used herein shall have the meaning ascribed to them 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 its acceptance hereof assents and by which such
Holder is bound.
Interest on this Certificate will accrue for each Distribution Date
during the preceding Interest Accrual Period in an amount equal to the product
of (i) 1/12th, (ii) the Class [__-M] Pass-Through Rate and (iii) the Current
Principal Amount hereof immediately prior to such Distribution Date. The Trustee
will distribute on the 25th day of each month, or, if such 25th day is not a
Business Day, the immediately following Business Day (each, a "Distribution
Date"), commencing on the first Distribution Date specified above, to the Person
in whose name this Certificate is registered on the applicable Record Date, an
amount equal to the product of the Fractional Undivided Interest evidenced by
this Certificate and the amount (of interest and principal, if any) required to
be distributed to the Holders of Certificates of the same Class as this
Certificate. The Assumed Final Distribution Date is the Distribution Date in the
month immediately following the month of the latest scheduled maturity date of
any Mortgage Loan and is not likely to be the date on which the Current
Principal Amount of this Class of Certificates will be reduced to zero.
Distributions on this Certificate will be made by the Trustee by check
mailed to the address of the Person entitled thereto as such name and address
shall appear on the Certificate Register or, if such Person so requests by
notifying the Trustee in writing as specified in the Agreement by wire transfer.
Notwithstanding the above, the final distribution on this Certificate will be
made after due notice by the Trustee of the pendency of such distribution and
only upon presentation and surrender of this Certificate at the office or agency
appointed by the Trustee for that purpose and designated in such notice.
Notwithstanding the forgoing, if this Certificate is a Book-Entry Certificate,
subject to the immediately preceding sentence regarding final distributions on
this Certificate, distributions shall be made to the Depository by wire transfer
in immediately available funds. The initial Current Principal Amount of this
Certificate is set forth above. The Current Principal Amount hereof will be
reduced to the extent of distributions allocable to principal hereon and any
Realized Losses allocated hereto.
This Certificate is one of a duly authorized issue of Certificates
designated as set forth on the face hereof (the "Certificates"), issued in
eleven Classes. The Certificates, in the aggregate, evidence the entire
beneficial ownership interest in the Trust formed pursuant to the Trust
Agreement, dated as of March 29, 2004, among ▇▇▇▇ ▇▇, the Trustee and the
Delaware Trustee.
The Certificateholder, by its acceptance of this Certificate, agrees
that it will look solely to the Trust for payment hereunder and no other party
to the Agreement is 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 hereby, and the rights,
duties and immunities of the Trustee.
The Agreement permits, with certain exceptions therein provided, the
amendment thereof by the Depositor, ▇▇▇▇▇▇▇▇▇, the Master Servicer, the
Securities Administrator, the Delaware Trustee and the Trustee with the consent
of the Holders of Certificates evidencing Fractional Undivided Interests
aggregating not less than 51% of the Trust (or, if such amendment affects only
one or more classes, of such Class or Classes). 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 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 with the
Trustee upon surrender of this Certificate for registration of transfer at the
offices or agencies maintained by the Trustee for such purposes, accompanied by
an executed written instrument of assignment and transfer in form and substance
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
in authorized denominations representing a like aggregate Fractional Undivided
Interest will be issued to the designated transferee.
The Certificates are issuable only as registered Certificates without
coupons in the Classes and denominations specified in the Agreement. As provided
in the Agreement and subject to certain limitations therein set forth, this
Certificate is exchangeable for one or more new Certificates evidencing the same
Class and in the same aggregate Fractional Undivided Interest, as requested by
the Holder surrendering the same.
No service charge will be made to the Certificateholders for any such
registration of transfer, but the Trustee may require payment of a sum
sufficient to cover any tax or other governmental charge payable in connection
therewith. ▇▇▇▇ ▇▇, the Master Servicer, the Securities Administrator,
▇▇▇▇▇▇▇▇▇, the Delaware Trustee and the Trustee and any successor of any of them
may treat the Person in whose name this Certificate is registered as the owner
hereof for all purposes, and none of ▇▇▇▇ ▇▇, the Master Servicer, the
Securities Administrator, ▇▇▇▇▇▇▇▇▇, the Delaware Trustee or the Trustee or any
such successor shall be affected by notice to the contrary.
The obligations created by the Agreement and the Trust created thereby
(other than the obligations to make payments to Certificateholders with respect
to the termination of the Agreement) shall terminate upon the earlier of (i) the
later of the (A) final payment or other liquidation (or Advance with respect
thereto) of the last Mortgage Loan remaining in the Trust and (B) disposition of
all property acquired upon foreclosure or deed in lieu of foreclosure of any
Mortgage Loan and the remittance of all funds due under the Agreement, (ii) the
optional repurchase by ▇▇▇▇▇▇▇▇▇ of all the Mortgage Loans and other assets of
the Trust in accordance with the terms of the Agreement or (iii) the payment to
Certificateholders of all amounts required to be paid to them pursuant to the
Agreement. Such optional repurchase may be made only on or after the
Distribution Date on which the aggregate Scheduled Principal Balance of the
Mortgage Loans is less than the percentage of the aggregate Outstanding
Principal Balance specified in the Agreement of the Mortgage Loans at the
Cut-off Date. The exercise of such right will effect the early retirement of the
Certificates.
▇▇▇▇▇▇▇▇▇ Mortgage, Inc. ("TMI") has the right to effect early
retirement of this Certificate by exercising its Optional Securities Purchase
Right on any Distribution Date on or after the Distribution Date on which the
aggregate Scheduled Principal Balance of the Mortgage Loans as of the end of the
immediately preceding Due Period is equal to or less than 20% of the Cut-off
Date Balance thereof, as set forth in Section 5.09 of the Agreement. The Holder
of this Certificate shall be entitled to receive an amount equal to Current
Interest, principal and any Interest Carry-Forward Amount allocable to this
Certificate as specified in the Agreement. Following exercise of the Optional
Securities Purchase Right by TMI, this Certificate shall be deemed cancelled.
Unless this Certificate has been authenticated by an authorized
signatory of the Trustee by manual signature, this Certificate shall not be
entitled to any benefit under the Agreement, or be valid for any purpose.
IN WITNESS WHEREOF, the Trustee has caused this Certificate to be duly
executed.
Dated: _______________ DEUTSCHE BANK NATIONAL TRUST COMPANY
Not in its individual capacity but solely
as Trustee
By:
-----------------------------
Authorized Signatory
CERTIFICATE OF AUTHENTICATION
This is one of the Class [__-M] Certificates referred to in the
within-mentioned Agreement.
DEUTSCHE BANK NATIONAL TRUST COMPANY
Authorized signatory of Deutsche Bank
National Trust Company, not
in its individual capacity but solely as
Trustee
By:
------------------------------
Authorized Signatory
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) a Fractional Undivided
Interest evidenced by the Mortgage Pass-Through Certificate and hereby
authorizes the transfer of registration of such interest to assignee on the
Certificate Register of the Trust.
I (We) further direct the Certificate Registrar to issue a new
Certificate of a like denomination and Class, to the above named assignee and
deliver such Certificate to the following address:
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Dated: ____________________________________________
Signature by or on behalf of assignor
___________________________________________
Signature Guaranteed
DISTRIBUTION INSTRUCTIONS
The assignee should include the following for purposes of
distribution:
Distributions shall be made, by wire transfer or otherwise, in
immediately available funds to _________________________________ for the account
of _________________________ account number _____________, or, if mailed by
check, to ______________________________. Applicable statements should be mailed
to _____________________________________________.
This information is provided by__________________, the assignee named
above, or ________________________, as its agent.
Exhibit A-3
FORM OF CLASS B-IO CERTIFICATE
THIS CERTIFICATE HAS BOTH A PRINCIPAL BALANCE AND A NOTIONAL BALANCE
AND IS ENTITLED TO PRINCIPAL DISTRIBUTIONS IN RESPECT OF ITS PRINCIPAL.
SOLELY FOR U.S. FEDERAL INCOME TAX PURPOSES, THIS CERTIFICATE IS A
"REGULAR INTEREST" IN A "REAL ESTATE MORTGAGE INVESTMENT CONDUIT," AS THOSE
TERMS ARE DEFINED, RESPECTIVELY, IN SECTIONS 860G AND 860D OF THE INTERNAL
REVENUE CODE OF 1986, AS AMENDED (THE "CODE").
THIS CERTIFICATE HAS NOT BEEN AND WILL NOT BE REGISTERED UNDER THE
SECURITIES ACT OF 1933, AS AMENDED (THE "SECURITIES ACT"), OR UNDER ANY STATE
SECURITIES LAWS. THE HOLDER HEREOF, BY PURCHASING THIS CERTIFICATE, AGREES THAT
THIS CERTIFICATE MAY BE REOFFERED, RESOLD, PLEDGED OR OTHERWISE TRANSFERRED ONLY
IN COMPLIANCE WITH THE SECURITIES ACT AND OTHER APPLICABLE LAWS AND ONLY (1)
PURSUANT TO RULE 144A UNDER THE SECURITIES ACT ("RULE 144A") TO A PERSON THAT
THE HOLDER REASONABLY BELIEVES IS A QUALIFIED INSTITUTIONAL BUYER WITHIN THE
MEANING OF RULE 144A (A "QIB"), PURCHASING FOR ITS OWN ACCOUNT OR A QIB
PURCHASING FOR THE ACCOUNT OF A QIB, WHOM THE HOLDER HAS INFORMED, IN EACH CASE,
THAT THE REOFFER, RESALE, PLEDGE OR OTHER TRANSFER IS BEING MADE IN RELIANCE ON
RULE 144A, (2) PURSUANT TO AN EXEMPTION FROM REGISTRATION PROVIDED BY RULE 144
UNDER THE SECURITIES ACT (IF AVAILABLE) SUBJECT TO THE RECEIPT BY THE TRUSTEE OF
A LETTER SUBSTANTIALLY IN THE FORM PROVIDED IN THE AGREEMENT OR (3) IN
CERTIFICATED FORM TO AN "INSTITUTIONAL ACCREDITED INVESTOR" WITHIN THE MEANING
THEREOF IN RULE 501(A)(1), (2), (3) OR (7) OF REGULATION D UNDER THE ACT OR ANY
ENTITY IN WHICH ALL OF THE EQUITY OWNERS COME WITHIN SUCH PARAGRAPHS PURCHASING
NOT FOR DISTRIBUTION IN VIOLATION OF THE SECURITIES ACT, SUBJECT TO (A) THE
RECEIPT BY THE TRUSTEE OF A LETTER SUBSTANTIALLY IN THE FORM PROVIDED IN THE
AGREEMENT AND (B) THE RECEIPT BY THE TRUSTEE OF SUCH OTHER EVIDENCE ACCEPTABLE
TO THE TRUSTEE THAT SUCH REOFFER, RESALE, PLEDGE OR TRANSFER IS IN COMPLIANCE
WITH THE SECURITIES ACT AND OTHER APPLICABLE LAWS OR IN EACH CASE IN ACCORDANCE
WITH ALL APPLICABLE SECURITIES LAWS OF THE UNITED STATES AND ANY OTHER
APPLICABLE JURISDICTION.
THIS CERTIFICATE MAY NOT BE ACQUIRED DIRECTLY OR INDIRECTLY BY, OR ON
BEHALF OF, AN EMPLOYEE BENEFIT PLAN OR OTHER RETIREMENT ARRANGEMENT WHICH IS
SUBJECT TO TITLE I OF THE EMPLOYEE RETIREMENT INCOME SECURITY ACT OF 1974, AS
AMENDED, AND/OR SECTION 4975 OF THE INTERNAL REVENUE CODE OF 1986, AS AMENDED
UNLESS THE PROPOSED TRANSFER AND/OR HOLDING OF A CERTIFICATE AND THE SERVICING,
MANAGEMENT AND/OR OPERATION OF THE TRUST AND ITS ASSETS: (I) WILL NOT RESULT IN
ANY PROHIBITED TRANSACTION WHICH IS NOT COVERED UNDER AN INDIVIDUAL OR CLASS
PROHIBITED TRANSACTION EXEMPTION, INCLUDING, BUT NOT LIMITED TO, PROHIBITED
TRANSACTION EXEMPTION ("PTE") 84-14, ▇▇▇ ▇▇-▇, ▇▇▇ ▇▇-▇▇, ▇▇▇ 95-60 OR PTE 96-23
AND (II) WILL NOT GIVE RISE TO ANY ADDITIONAL FIDUCIARY DUTIES ON THE PART OF
THE DEPOSITOR, THE SECURITIES ADMINISTRATOR, THE MASTER SERVICER, THE TRUSTEE OR
THE DELAWARE TRUSTEE OR ANY SERVICER WHICH WILL BE DEEMED REPRESENTED OR WILL BE
EVIDENCED BY A REPRESENTATION OR AN OPINION OF COUNSEL TO SUCH EFFECT AS
REQUIRED BY THE AGREEMENT REFERRED TO HEREIN.
Certificate No. B-IO-__ Interest Rate: N/A
Class B-IO
Cut-off Date: Aggregate Initial Notional
March 1, 2004 Balance of this Class as of
the Cut-off Date:
$1,106,707,889.20
First Distribution Date: April 25, 2004 Initial Notional Balance of this
Certificate as of the
Cut-off Date: $__________
Initial Principal Balance of this
Class as of the
Cut-off Date: $389.20
Initial Principal Balance of this
Certificate as of the
Cut-off Date: $__________
Master Servicer: ▇▇▇▇▇ Fargo Bank, N.A. CUSIP: 885220 FD 0
Trustee: Deutsche Bank National Trust Company Assumed Final Distribution Date:
▇▇▇▇▇ ▇▇, ▇▇▇▇
▇▇▇▇▇▇▇▇▇ MORTGAGE SECURITIES TRUST 2004-1
MORTGAGE PASS-THROUGH CERTIFICATES SERIES 2004-1
evidencing a fractional undivided interest in the distributions
allocable to the Class B-IO Certificates issued by ▇▇▇▇▇▇▇▇▇ Mortgage
Securities Trust 2004-1, a Delaware statutory trust (the "Trust")
consisting primarily of a pool of one- to four-family, first lien,
hybrid and adjustable interest rate mortgage loans (the "Mortgage
Loans").
This Certificate is payable solely from the assets of the Trust, and
does not represent an obligation of or interest in ▇▇▇▇ ▇▇, the Master Servicer,
the Securities Administrator, ▇▇▇▇▇▇▇▇▇, the Delaware Trustee or the Trustee
(each as defined below) or any of their affiliates or any other person. Neither
this Certificate nor the underlying Mortgage Loans are guaranteed or insured by
any governmental entity or by ▇▇▇▇ ▇▇, the Master Servicer, the Securities
Administrator, ▇▇▇▇▇▇▇▇▇, the Delaware Trustee or the Trustee or any of their
affiliates or any other person.
This certifies that __________ is the registered owner of the
Fractional Undivided Interest evidenced hereby in the beneficial ownership
interest of Certificates of the same Class as this Certificate in the Trust,
which was created pursuant to the Trust, Pooling and Servicing Agreement dated
as of March 1, 2004 (the "Agreement"), among Structured Asset Mortgage
Investments II Inc. ("▇▇▇▇ ▇▇"), as depositor (the "Depositor"), ▇▇▇▇▇ Fargo
Bank, N.A. as master servicer (the "Master Servicer") and securities
administrator (the "Securities Administrator"), Deutsche Bank National Trust
Company, as trustee (the "Trustee"), Deutsche Bank Trust Company Delaware, as
Delaware trustee (the "Delaware Trustee") and ▇▇▇▇▇▇▇▇▇ Mortgage Home Loans,
Inc. ("▇▇▇▇▇▇▇▇▇"), a summary of certain of the pertinent provisions of which is
set forth hereafter. The Mortgage Loans were sold by ▇▇▇▇▇▇▇▇▇ to ▇▇▇▇ ▇▇
pursuant to the Mortgage Loan Purchase Agreement, dated as of March 1, 2004, and
from ▇▇▇▇ ▇▇ to the Trust pursuant to the Agreement. To the extent not defined
herein, capitalized terms used herein shall have the meaning ascribed to them 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 its acceptance hereof assents and by which such
Holder is bound.
This Class B-IO Certificate has both a principal balance and a
notional balance and does not bear interest at a specified rate. The Trustee
will distribute on the 25th day of each month, or, if such 25th day is not a
Business Day, the immediately following Business Day (each, a "Distribution
Date"), commencing on the first Distribution Date specified above, to the Person
in whose name this Certificate is registered at the close of business on the
last Business Day of the calendar month preceding the month of such Distribution
Date, an amount equal to the product of the Fractional Undivided Interest
evidenced by this Certificate. The Assumed Final Distribution Date is the
Distribution Date in the month immediately following the month of the latest
scheduled maturity date of any Mortgage Loan.
No transfer of this 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 the Securities Act and such state securities laws. In the
event that a transfer 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 and
such Certificateholder's prospective transferee shall provide to the Trustee a
Rule 144A Certificate or an Investment Letter and/or such other documents as are
required under, and such transfer shall otherwise be in compliance with, the
Agreement. The Depositor shall provide to any Holder of this Certificate and any
prospective transferee designated by any such Holder, information required under
Rule 144A(d)(4) under the Securities Act.
Distributions on this Certificate will be made by the Trustee by check
mailed to the address of the Person entitled thereto as such name and address
shall appear on the Certificate Register or, if such Person so requests by
notifying the Trustee in writing as specified in the Agreement by wire transfer.
Notwithstanding the above, the final distribution on this Certificate will be
made after due notice by the Trustee of the pendency of such distribution and
only upon presentation and surrender of this Certificate at the office or agency
appointed by the Trustee for that purpose and designated in such notice.
Notwithstanding the forgoing, so long as this Certificate is a Book-Entry
Certificate, subject to the immediately preceding sentence regarding final
distributions on this Certificate, distributions shall be made to the Depository
by wire transfer in immediately available funds. The principal and notional
balance of this Certificate will be reduced as provided in the Agreement.
This Certificate is one of a duly authorized issue of Certificates
designated as set forth on the face hereof (the "Certificates"), issued in
eleven Classes. The Certificates, in the aggregate, evidence the entire
beneficial ownership interest in the Trust formed pursuant to the Trust
Agreement, dated as of March 29, 2004, among ▇▇▇▇ ▇▇, the Trustee and the
Delaware Trustee.
The Certificateholder, by its acceptance of this Certificate, agrees
that it will look solely to the Trust for payment hereunder and no other party
to the Agreement is 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 hereby, and the rights,
duties and immunities of the Trustee.
The Agreement permits, with certain exceptions therein provided, the
amendment thereof by the Depositor, ▇▇▇▇▇▇▇▇▇, the Master Servicer, the
Securities Administrator, the Delaware Trustee and the Trustee with the consent
of the Holders of Certificates evidencing Fractional Undivided Interests
aggregating not less than 51% of the Trust (or, if such amendment affects only
one or more classes, of such Class or Classes). 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 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 with the
Trustee upon surrender of this Certificate for registration of transfer at the
offices or agencies maintained by the Trustee for such purposes, accompanied by
an executed written instrument of assignment and transfer in form and substance
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
in authorized denominations representing a like aggregate Fractional Undivided
Interest will be issued to the designated transferee.
The Certificates are issuable only as registered Certificates without
coupons in the Classes and denominations specified in the Agreement. As provided
in the Agreement and subject to certain limitations therein set forth, this
Certificate is exchangeable for one or more new Certificates evidencing the same
Class and in the same aggregate Fractional Undivided Interest, as requested by
the Holder surrendering the same.
No service charge will be made to the Certificateholders for any such
registration of transfer, but the Trustee may require payment of a sum
sufficient to cover any tax or other governmental charge payable in connection
therewith. ▇▇▇▇ ▇▇, the Master Servicer, the Securities Administrator,
▇▇▇▇▇▇▇▇▇, the Delaware Trustee and the Trustee and any successor of any of them
may treat the Person in whose name this Certificate is registered as the owner
hereof for all purposes, and none of ▇▇▇▇ ▇▇, the Master Servicer, the
Securities Administrator, ▇▇▇▇▇▇▇▇▇, the Delaware Trustee or the Trustee or any
such successor shall be affected by notice to the contrary.
The obligations created by the Agreement and the Trust created thereby
(other than the obligations to make payments to Certificateholders with respect
to the termination of the Agreement) shall terminate upon the earlier of (i) the
later of the (A) final payment or other liquidation (or Advance with respect
thereto) of the last Mortgage Loan remaining in the Trust and (B) disposition of
all property acquired upon foreclosure or deed in lieu of foreclosure of any
Mortgage Loan and the remittance of all funds due under the Agreement, (ii) the
optional repurchase by ▇▇▇▇▇▇▇▇▇ of all the Mortgage Loans and other assets of
the Trust in accordance with the terms of the Agreement or (iii) the payment to
Certificateholders of all amounts required to be paid to them pursuant to the
Agreement. Such optional repurchase may be made only on or after the
Distribution Date on which the aggregate Scheduled Principal Balance of the
Mortgage Loans is less than the percentage of the aggregate Outstanding
Principal Balance specified in the Agreement of the Mortgage Loans at the
Cut-off Date. The exercise of such right will effect the early retirement of the
Certificates.
Unless this Certificate has been authenticated by an authorized
signatory of the Trustee by manual signature, this Certificate shall not be
entitled to any benefit under the Agreement, or be valid for any purpose.
IN WITNESS WHEREOF, the Trustee has caused this Certificate to be duly
executed.
Dated: _______________ DEUTSCHE BANK NATIONAL TRUST COMPANY
Not in its individual capacity but solely
as Trustee
By: _______________________________
Authorized Signatory
CERTIFICATE OF AUTHENTICATION
This is one of the Class B-IO Certificates referred to in the
within-mentioned Agreement.
DEUTSCHE BANK NATIONAL TRUST COMPANY
Authorized signatory of Deutsche Bank
National Trust Company, not in its
individual capacity but solely as Trustee
By: ______________________________
Authorized Signatory
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) a Fractional Undivided
Interest evidenced by the Mortgage Pass-Through Certificate and hereby
authorizes the transfer of registration of such interest to assignee on the
Certificate Register of the Trust.
I (We) further direct the Certificate Registrar to issue a new
Certificate of a like denomination and Class, to the above named assignee and
deliver such Certificate to the following address:
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Dated: _______________________________________
Signature by or on behalf of assignor
_______________________________________
Signature Guaranteed
DISTRIBUTION INSTRUCTIONS
The assignee should include the following for purposes of
distribution:
Distributions shall be made, by wire transfer or otherwise, in
immediately available funds to _________________________________ for the account
of _________________________ account number _____________, or, if mailed by
check, to ______________________________. Applicable statements should be mailed
to _____________________________________________.
This information is provided by__________________, the assignee named
above, or ________________________, as its agent.
Exhibit A-4
FORM OF CLASS [R-] CERTIFICATE
SOLELY FOR U.S. FEDERAL INCOME TAX PURPOSES, THIS CERTIFICATE IS A
"RESIDUAL INTEREST" IN A "REAL ESTATE MORTGAGE INVESTMENT CONDUIT" AS THOSE
TERMS ARE DEFINED, RESPECTIVELY, IN SECTIONS 860G AND 860D OF THE INTERNAL
REVENUE CODE OF 1986 (THE "CODE").
THIS CERTIFICATE MAY NOT BE ACQUIRED DIRECTLY OR INDIRECTLY BY, OR ON
BEHALF OF, AN EMPLOYEE BENEFIT PLAN OR OTHER RETIREMENT ARRANGEMENT WHICH IS
SUBJECT TO TITLE I OF THE EMPLOYEE RETIREMENT INCOME SECURITY ACT OF 1974, AS
AMENDED, AND/OR SECTION 4975 OF THE INTERNAL REVENUE CODE OF 1986, AS AMENDED.
ANY RESALE, TRANSFER OR OTHER DISPOSITION OF THIS CERTIFICATE MAY BE
MADE ONLY IF THE PROPOSED TRANSFEREE PROVIDES A TRANSFER AFFIDAVIT TO THE MASTER
SERVICER AND THE TRUSTEE THAT (1) SUCH TRANSFEREE IS NOT (A) THE UNITED STATES,
ANY STATE OR POLITICAL SUBDIVISION THEREOF, ANY FOREIGN GOVERNMENT, ANY
INTERNATIONAL ORGANIZATION, OR ANY AGENCY OR INSTRUMENTALITY OF ANY OF THE
FOREGOING, (B) ANY ORGANIZATION (OTHER THAN A COOPERATIVE DESCRIBED IN SECTION
521 OF THE CODE) WHICH IS EXEMPT FROM THE TAX IMPOSED BY CHAPTER 1 OF THE CODE
UNLESS SUCH ORGANIZATION IS SUBJECT TO THE TAX IMPOSED BY SECTION 511 OF THE
CODE, (C) ANY ORGANIZATION DESCRIBED IN SECTION 1381(A)(2)(C) OF THE CODE, (ANY
SUCH PERSON DESCRIBED IN THE FOREGOING CLAUSES (A), (B) OR (C) BEING HEREIN
REFERRED TO AS A "DISQUALIFIED ORGANIZATION") OR (D) AN AGENT OF A DISQUALIFIED
ORGANIZATION, (2) NO PURPOSE OF SUCH TRANSFER IS TO IMPEDE THE ASSESSMENT OR
COLLECTION OF TAX AND (3) SUCH TRANSFEREE SATISFIES CERTAIN ADDITIONAL
CONDITIONS RELATING TO THE FINANCIAL CONDITION OF THE PROPOSED TRANSFEREE.
NOTWITHSTANDING THE REGISTRATION IN THE CERTIFICATE REGISTER OR ANY TRANSFER,
SALE OR OTHER DISPOSITION OF THIS CERTIFICATE TO A DISQUALIFIED ORGANIZATION OR
AN AGENT OF A DISQUALIFIED ORGANIZATION, SUCH REGISTRATION SHALL BE DEEMED TO BE
OF NO LEGAL FORCE OR EFFECT WHATSOEVER AND SUCH PERSON SHALL NOT BE DEEMED TO BE
A CERTIFICATEHOLDER FOR ANY PURPOSE HEREUNDER, INCLUDING, BUT NOT LIMITED TO,
THE RECEIPT OF DISTRIBUTIONS ON THIS CERTIFICATE. EACH HOLDER OF THIS
CERTIFICATE BY ACCEPTANCE OF THIS CERTIFICATE SHALL BE DEEMED TO HAVE CONSENTED
TO THE PROVISIONS OF THIS PARAGRAPH.
Certificate No. [R-]-__ Interest Rate: N/A
Class [R-_]
Cut-off Date: Aggregate Initial Current
March 1, 2004 Principal Amount of this
Class as of the Cut-off
Date: $50.00
First Distribution Date: Initial Current Principal
April 25, 2004 Amount of this Certificate as
of the Cut-off Date: $50.00
Master Servicer: ▇▇▇▇▇ Fargo Bank, N.A. CUSIP: [R-1 - 885220 FB 4]
[R-2 - 885220 FC 2]
Trustee: Deutsche Bank National Trust Company Assumed Final Distribution
Date: ▇▇▇▇▇ ▇▇, ▇▇▇▇
▇▇▇▇▇▇▇▇▇ MORTGAGE SECURITIES TRUST
MORTGAGE PASS-THROUGH CERTIFICATE SERIES 2004-1
evidencing a fractional undivided interest in the distributions
allocable to the Class [R-__] Certificates issued by ▇▇▇▇▇▇▇▇▇
Mortgage Securities Trust 2004-1, a Delaware statutory trust (the
"Trust") consisting primarily of a pool of one- to four-family, first
lien, hybrid and adjustable interest rate mortgage loans (the
"Mortgage Loans").
This Certificate is payable solely from the assets of the Trust, and
does not represent an obligation of or interest in ▇▇▇▇ ▇▇, the Master Servicer,
the Securities Administrator, ▇▇▇▇▇▇▇▇▇, the Delaware Trustee or the Trustee
(each as defined below) or any of their affiliates or any other person. Neither
this Certificate nor the underlying Mortgage Loans are guaranteed or insured by
any governmental entity or by ▇▇▇▇ ▇▇, the Master Servicer, the Securities
Administrator, ▇▇▇▇▇▇▇▇▇, the Delaware Trustee or the Trustee or any of their
affiliates or any other person.
This certifies that _______________ is the registered owner of the
Fractional Undivided Interest evidenced hereby in the beneficial ownership
interest of Certificates of the same Class as this Certificate in the Trust,
which was created pursuant to the Trust, Pooling and Servicing Agreement dated
as of March 1, 2004 (the "Agreement"), among Structured Asset Mortgage
Investments II Inc. ("▇▇▇▇ ▇▇"), as depositor (the "Depositor"), ▇▇▇▇▇ Fargo
Bank, N.A. as master servicer (the "Master Servicer") and securities
administrator (the "Securities Administrator"), Deutsche Bank National Trust
Company, as trustee (the "Trustee"), Deutsche Bank Trust Company Delaware, as
Delaware trustee (the "Delaware Trustee") and ▇▇▇▇▇▇▇▇▇ Mortgage Home Loans,
Inc. ("▇▇▇▇▇▇▇▇▇"), a summary of certain of the pertinent provisions of which is
set forth hereafter. The Mortgage Loans were sold by ▇▇▇▇▇▇▇▇▇ to ▇▇▇▇ ▇▇
pursuant to the Mortgage Loan Purchase Agreement, dated as of March 1, 2004, and
from ▇▇▇▇ ▇▇ to the Trust pursuant to the Agreement. To the extent not defined
herein, capitalized terms used herein shall have the meaning ascribed to them 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 its acceptance hereof assents and by which such
Holder is bound.
This Class R-___ Certificate will not bear interest. The Trustee will
distribute on the 25th day of each month, or, if such 25th day is not a Business
Day, the immediately following Business Day (each, a "Distribution Date"),
commencing on the first Distribution Date specified above, to the Person in
whose name this Certificate is registered at the close of business on the last
Business Day of the calendar month preceding the month of such Distribution
Date, an amount equal to the product of the Fractional Undivided Interest
evidenced by this Certificate and the amount (of principal, if any) required to
be distributed to the Holders of Certificates of the same Class as this
Certificate. The Assumed Final Distribution Date is the Distribution Date in the
month immediately following the month of the latest scheduled maturity date of
any Mortgage Loan. The Residual Certificates are scheduled to receive a payment
of their respective initial principal balances on the first Distribution Date.
Distributions on this Certificate will be made by the Trustee by check
mailed to the address of the Person entitled thereto as such name and address
shall appear on the Certificate Register or, if such Person so requests by
notifying the Trustee in writing as specified in the Agreement by wire transfer.
Notwithstanding the above, the final distribution on this Certificate will be
made after due notice by the Trustee of the pendency of such distribution and
only upon presentation and surrender of this Certificate at the office or agency
appointed by the Trustee for that purpose and designated in such notice. The
initial Current Principal Amount of this Certificate is set forth above. The
Current Principal Amount hereof will be reduced to the extent of distributions
allocable to principal hereon.
Each Holder of this Certificate will be deemed to have agreed to be
bound by the restrictions set forth in the Agreement to the effect that (i) each
person holding or acquiring any Ownership Interest in this Certificate must be a
United States Person and a Permitted Transferee, (ii) the transfer of any
Ownership Interest in this Certificate will be conditioned upon the delivery to
the Trustee of, among other things, an affidavit to the effect that it is a
United States Person and Permitted Transferee, (iii) any attempted or purported
transfer of any Ownership Interest in this Certificate in violation of such
restrictions will be absolutely null and void and will vest no rights in the
purported transferee, and (iv) if any person other than a United States Person
and a Permitted Transferee acquires any Ownership Interest in this Certificate
in violation of such restrictions, then the Depositor will have the right, in
its sole discretion and without notice to the Holder of this Certificate, to
sell this Certificate to a purchaser selected by the Company, which purchaser
may be the Depositor, or any affiliate of the Depositor, on such terms and
conditions as the Depositor may choose.
This Certificate is one of a duly authorized issue of Certificates
designated as set forth on the face hereof (the "Certificates"), issued in
eleven Classes. The Certificates, in the aggregate, evidence the entire
beneficial ownership interest in the Trust formed pursuant to the Trust
Agreement, dated as of March 29, 2004, among ▇▇▇▇ ▇▇, the Trustee and the
Delaware Trustee.
The Certificateholder, by its acceptance of this Certificate, agrees
that it will look solely to the Trust for payment hereunder and no other party
to the Agreement is 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 hereby, and the rights,
duties and immunities of the Trustee.
The Agreement permits, with certain exceptions therein provided, the
amendment thereof by the Depositor, ▇▇▇▇▇▇▇▇▇, the Master Servicer, the
Securities Administrator, the Delaware Trustee and the Trustee with the consent
of the Holders of Certificates evidencing Fractional Undivided Interests
aggregating not less than 51% of the Trust (or, if such amendment affects only
one or more classes, of such Class or Classes). 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 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 with the
Trustee upon surrender of this Certificate for registration of transfer at the
offices or agencies maintained by the Trustee for such purposes, accompanied by
an executed written instrument of assignment and transfer in form and substance
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
in authorized denominations representing a like aggregate Fractional Undivided
Interest will be issued to the designated transferee.
The Certificates are issuable only as registered Certificates without
coupons in the Classes and denominations specified in the Agreement. As provided
in the Agreement and subject to certain limitations therein set forth, this
Certificate is exchangeable for one or more new Certificates evidencing the same
Class and in the same aggregate Fractional Undivided Interest, as requested by
the Holder surrendering the same.
No service charge will be made to the Certificateholders for any such
registration of transfer, but the Trustee may require payment of a sum
sufficient to cover any tax or other governmental charge payable in connection
therewith. ▇▇▇▇ ▇▇, the Master Servicer, the Securities Administrator,
▇▇▇▇▇▇▇▇▇, the Delaware Trustee and the Trustee and any successor of any of them
may treat the Person in whose name this Certificate is registered as the owner
hereof for all purposes, and none of ▇▇▇▇ ▇▇, the Master Servicer, the
Securities Administrator, ▇▇▇▇▇▇▇▇▇, the Delaware Trustee or the Trustee or any
such successor shall be affected by notice to the contrary.
The obligations created by the Agreement and the Trust created thereby
(other than the obligations to make payments to Certificateholders with respect
to the termination of the Agreement) shall terminate upon the earlier of (i) the
later of the (A) final payment or other liquidation (or Advance with respect
thereto) of the last Mortgage Loan remaining in the Trust and (B) disposition of
all property acquired upon foreclosure or deed in lieu of foreclosure of any
Mortgage Loan and the remittance of all funds due under the Agreement, (ii) the
optional repurchase by ▇▇▇▇▇▇▇▇▇ of all the Mortgage Loans and other assets of
the Trust in accordance with the terms of the Agreement or (iii) the payment to
Certificateholders of all amounts required to be paid to them pursuant to the
Agreement. Such optional repurchase may be made only on or after the
Distribution Date on which the aggregate Scheduled Principal Balance of the
Mortgage Loans is less than the percentage of the aggregate Outstanding
Principal Balance specified in the Agreement of the Mortgage Loans at the
Cut-off Date. The exercise of such right will effect the early retirement of the
Certificates.
▇▇▇▇▇▇▇▇▇ Mortgage, Inc. ("TMI") has the right to effect early
retirement of this Certificate by exercising its Optional Securities Purchase
Right on any Distribution Date on or after the Distribution Date on which the
aggregate Scheduled Principal Balance of the Mortgage Loans as of the end of the
immediately preceding Due Period is equal to or less than 20% of the Cut-off
Date Balance thereof, as set forth in Section 5.09 of the Agreement. The Holder
of this Certificate shall be entitled to receive the amount allocable to this
Certificate as specified in the Agreement. Following exercise of the Optional
Securities Purchase Right by TMI, this Certificate shall be deemed cancelled.
Unless this Certificate has been authenticated by an authorized
signatory of the Trustee by manual signature, this Certificate shall not be
entitled to any benefit under the Agreement, or be valid for any purpose.
IN WITNESS WHEREOF, the Trustee has caused this Certificate to be duly
executed.
Dated: _______________ DEUTSCHE BANK NATIONAL TRUST COMPANY
Not in its individual capacity but solely
as Trustee
By: _______________________________
Authorized Signatory
CERTIFICATE OF AUTHENTICATION
This is one of the Class [R-_] Certificates referred to in the
within-mentioned Agreement.
DEUTSCHE BANK NATIONAL TRUST COMPANY
Authorized signatory of Deutsche Bank
National Trust Company, not
in its individual capacity but solely as
Trustee
By: ______________________________
Authorized Signatory
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) a Fractional Undivided
Interest evidenced by the Mortgage Pass-Through Certificate and hereby
authorizes the transfer of registration of such interest to assignee on the
Certificate Register of the Trust.
I (We) further direct the Certificate Registrar to issue a new
Certificate of a like denomination and Class, to the above named assignee and
deliver such Certificate to the following address:
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Dated: ______________________________________
Signature by or on behalf of assignor
______________________________________
Signature Guaranteed
DISTRIBUTION INSTRUCTIONS
The assignee should include the following for purposes of
distribution:
Distributions shall be made, by wire transfer or otherwise, in
immediately available funds to _________________________________ for the account
of _________________________ account number _____________, or, if mailed by
check, to ______________________________. Applicable statements should be mailed
to _____________________________________________.
This information is provided by__________________, the assignee named
above, or ________________________, as its agent.
EXHIBIT B
MORTGAGE LOAN SCHEDULE
[PROVIDED UPON REQUEST]
EXHIBIT C-1
FORM OF INITIAL CERTIFICATION
[Date]
[DEPOSITOR]
[SELLER]
Re: Trust, Pooling and Servicing Agreement (the "Agreement"), dated as of
March 1, 2004, by and among Structured Asset Mortgage Investments II
Inc., ▇▇▇▇▇ Fargo Bank, N.A., ▇▇▇▇▇▇▇▇▇ Mortgage Home Loans, Inc.,
Deutsche Bank National Trust Company and Deutsche Bank Trust Company
Delaware relating to ▇▇▇▇▇▇▇▇▇ Mortgage Securities Trust, MORTGAGE
PASS-THROUGH CERTIFICATES, SERIES 2004-1
Ladies and Gentlemen:
In accordance with Section 2.02(a) of the Agreement, the undersigned, as
Trustee, hereby certifies that it has received a Mortgage Loan File containing
an original Mortgage Note or Lost Note Affidavit, unless it has received a
separate blanket Lost Note Affidavit covering such Mortgage Loans to the extent
required in Section 2.01 of the Agreement with respect to each Mortgage Loan
listed in the Mortgage Loan Schedule, with any exceptions listed on SCHEDULE A
attached hereto.
The Trustee has made no independent examination of any documents contained
in the Mortgage File beyond the review specifically required in the 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 or 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 Agreement.
DEUTSCHE BANK NATIONAL TRUST COMPANY, as
Trustee and Custodian
By: __________________________
Name:
Title:
Schedule A
Exceptions: None.
EXHIBIT C-2
FORM OF INTERIM CERTIFICATION
[Date]
[DEPOSITOR]
[SELLER]
Re: Trust, Pooling and Servicing Agreement (the "Agreement"), dated as of
March 1, 2004, by and among Structured Asset Mortgage Investments II
Inc., ▇▇▇▇▇ Fargo Bank, N.A., ▇▇▇▇▇▇▇▇▇ Mortgage Home Loans, Inc.,
Deutsche Bank National Trust Company and Deutsche Bank Trust Company
Delaware relating to ▇▇▇▇▇▇▇▇▇ Mortgage SECURITIES TRUST, MORTGAGE
PASS-THROUGH CERTIFICATES, SERIES 2004-1
Ladies and Gentlemen:
In accordance with Section 2.02(a) of the above-captioned Trust, Pooling
and Servicing Agreement, the undersigned, as Trustee, hereby certifies that it
has received a Mortgage File to the extent required pursuant to Section 2.01 of
the Agreement with respect to each Mortgage Loan listed in the Mortgage Loan
Schedule, and it has reviewed the Mortgage File and the Mortgage Loan Schedule
and has determined that: all required documents have been executed and received
and that such documents relate to the Mortgage Loans identified on the Mortgage
Loan Schedule, with any exceptions listed on Schedule A attached hereto.
The Trustee has made no independent examination of any documents contained
in the Mortgage File beyond the review specifically required in the 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 or 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 Agreement.
DEUTSCHE BANK NATIONAL TRUST COMPANY
By: __________________________
Name:
Title:
EXHIBIT C-3
FORM OF FINAL CERTIFICATION
[Date]
[DEPOSITOR]
[SELLER]
Re: Trust, Pooling and Servicing Agreement (the "Agreement"), dated as of
March 1, 2004, by and among Structured Asset Mortgage Investments II
Inc., ▇▇▇▇▇ Fargo Bank, N.A., ▇▇▇▇▇▇▇▇▇ Mortgage Home Loans, Inc.,
Deutsche Bank National Trust Company and Deutsche Bank Trust Company
Delaware relating to ▇▇▇▇▇▇▇▇▇ Mortgage SECURITIES TRUST, MORTGAGE
PASS-THROUGH CERTIFICATES, SERIES 2004-1
Ladies and Gentlemen:
In accordance with Section 2.02(b) of the above-captioned Agreement, the
undersigned, as Trustee, hereby certifies that it has received a Mortgage File
to the extent required pursuant to Section 2.01 of the Agreement with respect to
each Mortgage Loan listed in the Mortgage Loan Schedule, and it has reviewed the
Mortgage File and the Mortgage Loan Schedule and has determined that: all
required documents have been executed and received and that such documents
relate to the Mortgage Loans identified on the Mortgage Loan Schedule, with any
exceptions listed on Schedule A attached hereto.
The Trustee has made no independent examination of any documents contained
in the Mortgage File beyond the review specifically required in the 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 or 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 Agreement.
DEUTSCHE BANK NATIONAL TRUST COMPANY
By: __________________________
Name:
Title:
EXHIBIT D
REQUEST FOR RELEASE OF DOCUMENTS
To: Deutsche Bank National Trust Company,
as Trustee and Custodian
▇▇▇▇ ▇▇▇▇ ▇▇. ▇▇▇▇▇▇ ▇▇▇▇▇
▇▇▇▇▇ ▇▇▇, ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇
RE: Trust, Pooling and Servicing Agreement dated as of
March 1, 2004, among Structured Asset Mortgage Investments II Inc.,
▇▇▇▇▇ Fargo Bank, N.A.,
as master servicer and securities administrator,
▇▇▇▇▇▇▇▇▇ Mortgage Home Loans, Inc.,
Deutsche Bank National Trust Company, as Trustee
AND DEUTSCHE BANK TRUST COMPANY DELAWARE, AS DELAWARE TRUSTEE
In connection with the administration of the Mortgage Loans held by you
pursuant to the above-captioned Trust, Pooling and Servicing Agreement, we
request the release, and hereby acknowledge receipt, of the Mortgage File for
the Mortgage Loan described below, for the reason indicated.
MORTGAGE LOAN NUMBER:
MORTGAGOR NAME, ADDRESS & ZIP CODE:
REASON FOR REQUESTING DOCUMENTS (CHECK ONE):
_____ 1. Mortgage Paid in Full and proceeds have been deposited into the
Custodial Account
_____ 2. Foreclosure
_____ 3. Substitution
_____ 4. Other Liquidation
_____ 5. Nonliquidation Reason: ___________________
_____ 6. California Mortgage Loan paid in full
By: ____________________
(authorized signer)
Issuer: _______________________
Address: _______________________
Date: _______________________
EXHIBIT E
Affidavit pursuant to Section
860E(e)(4) of the Internal Revenue
Code of 1986, as amended, and for
other purposes
STATE OF )
)ss:
COUNTY OF )
[NAME OF OFFICER], being first duly sworn, deposes and says:
1. That he is [Title of Officer] of [Name of Investor] (the "Investor"), a
[savings institution] [corporation] duly organized and existing under the laws
of [the State of ________] [the United States], on behalf of which he makes this
affidavit.
2. That (i) the Investor is not a "disqualified organization" as defined in
Section 860E(e)(5) of the Internal Revenue Code of 1986, as amended (the
"Code"), and will not be a disqualified organization as of [Closing Date] [date
of purchase]; (ii) it is not acquiring the ▇▇▇▇▇▇▇▇▇ Mortgage Securities Trust,
Mortgage Pass-Through Certificates, Series 2004-1, Class [R-1] [R-2]
Certificates (the "Residual Certificates") for the account of a disqualified
organization; (iii) it consents to any amendment of the Trust, Pooling and
Servicing Agreement that shall be deemed necessary by Structured Asset Mortgage
Investments II Inc. (upon advice of counsel) to constitute a reasonable
arrangement to ensure that the Residual Certificates will not be owned directly
or indirectly by a disqualified organization; and (iv) it will not transfer such
Residual Certificates unless (a) it has received from the transferee an
affidavit in substantially the same form as this affidavit containing these same
four representations and (b) as of the time of the transfer, it does not have
actual knowledge that such affidavit is false.
3. That the Investor is one of the following: (i) a citizen or resident of
the United States, (ii) a corporation or partnership (including an entity
treated as a corporation or partnership for federal income tax purposes) created
or organized in, or under the laws of, the United States or any state thereof or
the District of Columbia (except, in the case of a partnership, to the extent
provided in regulations), provided that no partnership or other entity treated
as a partnership for United States federal income tax purposes shall be treated
as a United States Person unless all persons that own an interest in such
partnership either directly or through any entity that is not a corporation for
United States federal income tax purposes are United States Persons, (iii) an
estate whose income is subject to United States federal income tax regardless of
its source, or (iv) a trust other than a "foreign trust," as defined in Section
7701 (a)(31) of the Code.
4. That the Investor's taxpayer identification number is _______________.
5. That no purpose of the acquisition of the Residual Certificates is to
avoid or impede the assessment or collection of tax.
6. That the Investor understands that, as the holder of the Residual
Certificates, the Investor may incur tax liabilities in excess of any cash flows
generated by such Residual Certificates.
7. That the Investor intends to pay taxes associated with holding the
Residual Certificates as they become due.
8. That the Residual Certificate is not being acquired either directly or
indirectly, by or on behalf of, an employee benefit plan or other retirement
arrangement subject to Title I of the Employee Retirement Income Security Act of
1974, as amended or Section 4975 of the Code.
IN WITNESS WHEREOF, the Investor has caused this instrument to be executed
on its behalf, pursuant to authority of its Board of Directors, by its [Title of
Officer] this ____ day of _________, 20__.
[NAME OF INVESTOR]
By: ____________________
[Name of Officer]
[Title of Officer]
[Address of Investor for receipt of
distributions]
Address of Investor for receipt of tax
information:
Personally appeared before me the above-named [Name of Officer], known or
proved to me to be the same person who executed the foregoing instrument and to
be the [Title of Officer] of the Investor, and acknowledged to me that he
executed the same as his free act and deed and the free act and deed of the
Investor.
Subscribed and sworn before me this ___ day of _________, 20___.
NOTARY PUBLIC
COUNTY OF
STATE OF
My commission expires the ___ day of ___________________, 20___.
EXHIBIT F-1
FORM OF INVESTMENT LETTER
[Date]
[SELLER]
Deutsche Bank National Trust Company,
as Trustee
▇▇▇▇ ▇▇▇▇ ▇▇. ▇▇▇▇▇▇ ▇▇▇▇▇
▇▇▇▇▇ ▇▇▇, ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Structured Asset Mortgage Investments II Inc.
▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇ ▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇
Re: ▇▇▇▇▇▇▇▇▇ Mortgage Securities Trust, Mortgage Pass-Through Certificates,
Series 2004-1 (the "Certificates"), Class B-IO Certificates (THE "PRIVATE
CERTIFICATES")
Dear Ladies and Gentlemen:
In connection with our purchase of Private Certificates, we confirm that:
(i) we understand that the Private Certificates are not being registered
under the Securities Act of 1933, as amended (the "Act") or any
applicable state securities or "Blue Sky" laws, and are being sold to
us in a transaction that is exempt from the registration requirements
of such laws;
(ii) any information we desired concerning the Certificates, including the
Private Certificates, ▇▇▇▇▇▇▇▇▇ Mortgage Securities Trust 2004-1 (the
"Trust"), in which the Certificates represent the entire beneficial
ownership interest or any other matter we deemed relevant to our
decision to purchase the Private Certificates has been made available
to us;
(iii) we are able to bear the economic risk of investment in the Private
Certificates; we are an institutional "accredited investor" as defined
in Section 501(a) of Regulation D promulgated under the Act and a
sophisticated institutional investor;
(iv) we are acquiring the Private Certificates for our own account, not as
nominee for any other person, and not with a present view to any
distribution or other disposition of the Private Certificates;
(v) we agree the Private Certificates must be held indefinitely by us (and
may not be sold, pledged, hypothecated or in any way disposed of)
unless subsequently registered under the Act and any applicable state
securities or "Blue Sky" laws or an exemption from the registration
requirements of the Act and any applicable state securities or "Blue
Sky" laws is available;
(vi) we agree that in the event that at some future time we wish to dispose
of or exchange the Private Certificate (such disposition or exchange
not being currently foreseen or contemplated), we will not transfer or
exchange the Private Certificates unless:
(A) (1) the sale is to an Eligible Purchaser (as defined below), (2)
if required by the Trust, Pooling and Servicing Agreement (as
defined below) a letter to substantially the same effect as
either this letter or, if the Eligible Purchaser is a Qualified
Institutional Buyer as defined under Rule 144A of the Act, the
Rule 144A and Related Matters Certificate in the form attached to
the Trust, Pooling and Servicing Agreement (as defined below) (or
such other documentation as may be acceptable to the Trustee) is
executed promptly by the purchaser and delivered to the
addressees hereof and (3) all offers or solicitations in
connection with the sale, whether directly or through any agent
acting on our behalf, are limited only to Eligible Purchasers and
are not made by means of any form of general solicitation or
general advertising whatsoever; and
(B) if the Private Certificates are not registered under the Act (as
to which we acknowledge you have no obligation), the Private
Certificates are sold in a transaction that does not require
registration under the Act and any applicable state securities or
"blue sky" laws and, if Deutsche Bank National Trust Company (the
"Trustee") so requests, a satisfactory Opinion of Counsel is
furnished to such effect, which Opinion of Counsel shall be an
expense of the transferor or the transferee;
(vii) we agree to be bound by all of the terms (including those relating to
restrictions on transfer) of the Trust, Pooling and Servicing,
pursuant to which the Trust was formed; we have reviewed carefully and
understand the terms of the Trust, Pooling and Servicing Agreement;
(viii) we either: (i) are not acquiring the Private Certificates directly
or indirectly by, or on behalf of, an employee benefit plan or other
retirement arrangement which is subject to Title I of the Employee
Retirement Income Security Act of 1974, as amended, and/or section
4975 of the Internal Revenue Code of 1986, as amended, or (ii) are
providing a representation or an opinion of counsel to the effect that
the proposed transfer and/or holding of a Private Certificate and the
servicing, management and/or operation of the Trust and its assets:
(I) will not result in any prohibited transaction which is not covered
under an individual or class prohibited transaction exemption,
including, but not limited to, Prohibited Transaction Exemption
("PTE") 84-14, ▇▇▇ ▇▇-▇, ▇▇▇ ▇▇-▇▇, ▇▇▇ ▇▇-▇▇, ▇▇▇ 96-23 or Section
401(c) of ERISA and the regulations promulgated thereunder and (II)
will not give rise to any additional fiduciary duties on the part of
the Depositor, the Master Servicer, the Securities Administrator, any
Servicer or the Trustee.
(ix) We understand that the Class B-IO Certificate bears, and will continue
to bear, a legend to substantially the following effect: "THIS
CERTIFICATE HAS NOT BEEN AND WILL NOT BE REGISTERED UNDER THE
SECURITIES ACT OF 1933, AS AMENDED (THE "SECURITIES ACT"), OR UNDER
ANY STATE SECURITIES LAWS. THE HOLDER HEREOF, BY PURCHASING THIS
CERTIFICATE, AGREES THAT THIS CERTIFICATE MAY BE REOFFERED, RESOLD,
PLEDGED OR OTHERWISE TRANSFERRED ONLY IN COMPLIANCE WITH THE
SECURITIES ACT AND OTHER APPLICABLE LAWS AND ONLY (1) PURSUANT TO RULE
144A UNDER THE SECURITIES ACT ("RULE 144A") TO A PERSON THAT THE
HOLDER REASONABLY BELIEVES IS A QUALIFIED INSTITUTIONAL BUYER WITHIN
THE MEANING OF RULE 144A (A "QIB"), PURCHASING FOR ITS OWN ACCOUNT OR
A QIB PURCHASING FOR THE ACCOUNT OF A QIB, WHOM THE HOLDER HAS
INFORMED, IN EACH CASE, THAT THE REOFFER, RESALE, PLEDGE OR OTHER
TRANSFER IS BEING MADE IN RELIANCE ON RULE 144A, (2) PURSUANT TO AN
EXEMPTION FROM REGISTRATION PROVIDED BY RULE 144 UNDER THE SECURITIES
ACT (IF AVAILABLE) SUBJECT TO THE RECEIPT BY THE TRUSTEE OF A LETTER
SUBSTANTIALLY IN THE FORM PROVIDED IN THE AGREEMENT OR (3) IN
CERTIFICATED FORM TO AN "INSTITUTIONAL ACCREDITED INVESTOR" WITHIN THE
MEANING THEREOF IN RULE 501(a)(1), (2), (3) or (7) OF REGULATION D
UNDER THE ACT OR ANY ENTITY IN WHICH ALL OF THE EQUITY OWNERS COME
WITHIN SUCH PARAGRAPHS PURCHASING NOT FOR DISTRIBUTION IN VIOLATION OF
THE SECURITIES ACT, SUBJECT TO (A) THE RECEIPT BY THE TRUSTEE OF A
LETTER SUBSTANTIALLY IN THE FORM PROVIDED IN THE AGREEMENT AND (B) THE
RECEIPT BY THE TRUSTEE OF SUCH OTHER EVIDENCE ACCEPTABLE TO THE
TRUSTEE THAT SUCH REOFFER, RESALE, PLEDGE OR TRANSFER IS IN COMPLIANCE
WITH THE SECURITIES ACT AND OTHER APPLICABLE LAWS OR IN EACH CASE IN
ACCORDANCE WITH ALL APPLICABLE SECURITIES LAWS OF THE UNITED STATES
AND ANY OTHER APPLICABLE JURISDICTION. THIS CERTIFICATE MAY NOT BE
ACQUIRED DIRECTLY OR INDIRECTLY BY, OR ON BEHALF OF, AN EMPLOYEE
BENEFIT PLAN OR OTHER RETIREMENT ARRANGEMENT WHICH IS SUBJECT TO TITLE
I OF THE EMPLOYEE RETIREMENT INCOME SECURITY ACT OF 1974, AS AMENDED,
AND/OR SECTION 4975 OF THE INTERNAL REVENUE CODE OF 1986, AS AMENDED
UNLESS THE PROPOSED TRANSFER AND/OR HOLDING OF A CERTIFICATE AND THE
SERVICING, MANAGEMENT AND/OR OPERATION OF THE TRUST AND ITS ASSETS:
(I) WILL NOT RESULT IN ANY PROHIBITED TRANSACTION WHICH IS NOT COVERED
UNDER AN INDIVIDUAL OR CLASS PROHIBITED TRANSACTION EXEMPTION,
INCLUDING, BUT NOT LIMITED TO, PROHIBITED TRANSACTION EXEMPTION
("PTE") 84-14, ▇▇▇ ▇▇-▇, ▇▇▇ ▇▇-▇▇, ▇▇▇ 95-60 OR PTE 96-23 AND (II)
WILL NOT GIVE RISE TO ANY ADDITIONAL FIDUCIARY DUTIES ON THE PART OF
THE DEPOSITOR, THE SECURITIES ADMINISTRATOR, THE MASTER SERVICER, THE
TRUSTEE OR THE DELAWARE TRUSTEE OR ANY SERVICER WHICH WILL BE DEEMED
REPRESENTED OR WILL BE EVIDENCED BY A REPRESENTATION OR AN OPINION OF
COUNSEL TO SUCH EFFECT AS REQUIRED BY THE AGREEMENT REFERRED TO
HEREIN."
"Eligible Purchaser" means a corporation, partnership or other entity which
we have reasonable grounds to believe and do believe (i) can make
representations with respect to itself to substantially the same effect as the
representations set forth herein, and (ii) is either a Qualified Institutional
Buyer as defined under Rule 144A of the Act or an institutional "Accredited
Investor" as defined under Rule 501 of the Act.
Terms not otherwise defined herein shall have the meanings assigned to them
in the Trust, Pooling and Servicing Agreement, dated as of March 1, 2004, among
Structured Asset Mortgage Investments II Inc., ▇▇▇▇▇ Fargo Bank, N.A. as master
servicer and securities administrator, ▇▇▇▇▇▇▇▇▇ Mortgage Home Loans, Inc.,
Deutsche Bank National Trust Company, as Trustee and Deutsche Bank Trust Company
Delaware, as Delaware trustee (the "Trust, Pooling and Servicing Agreement').
If the Purchaser proposes that its Certificates be registered in the name
of a nominee on its behalf, the Purchaser has identified such nominee below, and
has caused such nominee to complete the Nominee Acknowledgment at the end of
this letter.
Name of Nominee (if any):
IN WITNESS WHEREOF, this document has been executed by the undersigned who
is duly authorized to do so on behalf of the undersigned Eligible Purchaser on
the ___ day of ________, 20___.
Very truly yours,
[PURCHASER]
By: _________________
(Authorized Officer)
[By: _________________
Attorney-in-fact]
Nominee Acknowledgment
The undersigned hereby acknowledges and agrees that as to the Certificates
being registered in its name, the sole beneficial owner thereof is and shall be
the Purchaser identified above, for whom the undersigned is acting as nominee.
[NAME OF NOMINEE]
By: __________________
(Authorized Officer)
[By: __________________
Attorney-in-fact]
EXHIBIT F-2
FORM OF RULE 144A AND RELATED MATTERS CERTIFICATE
[SELLER]
Deutsche Bank National Trust Company,
as Trustee
▇▇▇▇ ▇▇▇▇ ▇▇. ▇▇▇▇▇▇ ▇▇▇▇▇
▇▇▇▇▇ ▇▇▇, ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Structured Asset Mortgage Investments II Inc.
▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇ ▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇
Re: ▇▇▇▇▇▇▇▇▇ Mortgage Securities Trust, Mortgage Pass-Through Certificates,
Series 2004-1 (THE "CERTIFICATES"), CLASS B-IO CERTIFICATES (THE "PRIVATE
CERTIFICATES")
Dear Ladies and Gentlemen:
In connection with our purchase of the Private Certificates, the
undersigned certifies to each of the parties to whom this letter is addressed
that it is a qualified institutional buyer (as defined in Rule 144A under the
Securities Act of 1933, as amended (the "Act")) as follows:
1. It owned and/or invested on a discretionary basis eligible securities
(excluding affiliate's securities, bank deposit notes and CD's, loan
participations, repurchase agreements, securities owned but subject to a
repurchase agreement and swaps), as described below:
Date: ______________, 20__ (must be on or after the close of its most
recent fiscal year)
Amount: $ _____________________; and
2. The dollar amount set forth above is:
a. greater than $100 million and the undersigned is one of the following
entities:
(x) |_| an insurance company as defined in Section 2(13) of the Act1;
or
(y) |_| an investment company registered under the Investment Company
Act or any business development company as defined in Section
2(a)(48) of the Investment Company Act of 1940; or
(z) |_| 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; or
--------
1 A purchase by an insurance company for one or more of its separate
accounts, as defined by Section 2(a)(37) of the Investment Company Act of
1940, which are neither registered nor required to be registered
thereunder, shall be deemed to be a purchase for the account of such
insurance company.
(aa) |_| a plan (i) established and maintained by a state, its
political subdivisions, or any agency or instrumentality of a
state or its political subdivisions, the laws of which permit the
purchase of securities of this type, for the benefit of its
employees and (ii) the governing investment guidelines of which
permit the purchase of securities of this type; or
(bb) |_| a business development company as defined in Section
202(a)(22) of the Investment Advisers Act of 1940; or
(cc) |_| a corporation (other than a U.S. bank, savings and loan
association or equivalent foreign institution), partnership,
Massachusetts or similar business trust, or an organization
described in Section 501(c)(3) of the Internal Revenue Code; or
(dd) |_| a U.S. bank, savings and loan association or equivalent
foreign institution, which has an audited net worth of at least
$25 million as demonstrated in its latest annual financial
statements; or
(ee) |_| an investment adviser registered under the Investment
Advisers Act; or
b. |_| greater than $10 million, and the undersigned is a broker-dealer
registered with the SEC; or
c. |_| less than $ 10 million, and the undersigned is a broker-dealer
registered with the SEC and will only purchase Rule 144A securities in
transactions in which it acts as a riskless principal (as defined in Rule
144A); or
d. |_| less than $100 million, and the undersigned is an investment company
registered under the Investment Company Act of 1940, which, together with
one or more registered investment companies having the same or an
affiliated investment adviser, owns at least $100 million of eligible
securities; or
e. |_| less than $100 million, and the undersigned is an entity, all the
equity owners of which are qualified institutional buyers.
The undersigned further certifies that it is purchasing a Private
Certificate for its own account or for the account of others that independently
qualify as "Qualified Institutional Buyers" as defined in Rule 144A. It is aware
that the sale of the Private Certificate is being made in reliance on its
continued compliance with Rule 144A. It is aware that the transferor may rely on
the exemption from the provisions of Section 5 of the Act provided by Rule 144A.
The undersigned understands that the Private Certificate may be resold, pledged
or transferred only to (i) 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 in Rule 144A, or (ii) an institutional
"accredited investor," as such term is defined under Rule 501 of the Act in a
transaction that otherwise does not constitute a public offering.
The undersigned agrees that if at some future time it wishes to dispose of
or exchange the Private Certificate, it will not transfer or exchange the
Private Certificate to a Qualified Institutional Buyer without first obtaining a
Rule 144A and Related Matters Certificate in the form hereof from the transferee
and delivering such certificate to the addressees hereof. Prior to making any
transfer of the Private Certificate, if the proposed Transferee is an
institutional "accredited investor," the transferor shall obtain from the
transferee and deliver to the addressees hereof an Investment Letter in the form
attached to the Trust, Pooling and Servicing Agreement, dated as of March 1,
2004, among Structured Asset Mortgage Investments II Inc., ▇▇▇▇▇ Fargo Bank,
N.A., ▇▇▇▇▇▇▇▇▇ Mortgage Home Loans, Inc., Deutsche Bank National Trust Company,
as Trustee and Deutsche Bank Trust Company Delaware, pursuant to Certificates
were issued.
The undersigned certifies that it either: (i) is not acquiring the Private
Certificate directly or indirectly by, or on behalf of, an employee benefit plan
or other retirement arrangement which is subject to Title I of the Employee
Retirement Income Security Act of 1974, as amended, and/or section 4975 of the
Internal Revenue Code of 1986, as amended, or (ii) the proposed transfer and/or
holding of a Private Certificate and the servicing, management and/or operation
of the Trust and its assets: (I) will not result in any prohibited transaction
which is not covered under a prohibited transaction exemption, including, but
not limited to, Prohibited Transaction Exemption ("PTE") 84-14, ▇▇▇ ▇▇-▇, ▇▇▇
▇▇-▇▇, ▇▇▇ ▇▇-▇▇, ▇▇▇ ▇▇-▇▇ and (II) will not give rise to any additional
fiduciary duties on the part of the Depositor, the Master Servicer or the
Trustee.
If the Purchaser proposes that its Certificates be registered in the name
of a nominee on its behalf, the Purchaser has identified such nominee below, and
has caused such nominee to complete the Nominee Acknowledgment at the end of
this letter.
Name of Nominee (if any):
IN WITNESS WHEREOF, this document has been executed by the undersigned who
is duly authorized to do so on behalf of the undersigned Eligible Purchaser on
the ____ day of ___________, 20___.
Very truly yours,
[PURCHASER]
By: _______________________
(Authorized Officer)
[By: _______________________
Attorney-in-fact]
Nominee Acknowledgment
The undersigned hereby acknowledges and agrees that as to the Certificates
being registered in its name, the sole beneficial owner thereof is and shall be
the Purchaser identified above, for whom the undersigned is acting as nominee.
[NAME OF NOMINEE]
By: _______________________
(Authorized Officer)
[By: _______________________
Attorney-in-fact]
EXHIBIT G
FORM OF CUSTODIAL AGREEMENT
THIS CUSTODIAL AGREEMENT (as amended and supplemented from time to time,
the "Agreement'), dated as of _______ __, 20__, by and among DEUTSCHE BANK
NATIONAL TRUST COMPANY, as trustee (including its successors under the Trust,
Pooling and Servicing Agreement defined below, the "Trustee"), STRUCTURED ASSET
MORTGAGE INVESTMENTS II INC., as company (together with any successor in
interest, the "Company"), ▇▇▇▇▇ FARGO BANK, N.A., as master servicer and
securities administrator (together with any successor in interest or successor
under the Trust, Pooling and Servicing Agreement referred to below, the "Master
Servicer"), ▇▇▇▇▇▇▇▇▇ MORTGAGE HOME LOANS, INC. ("▇▇▇▇▇▇▇▇▇") or (the "Seller")
and ______________________________________, as custodian (together with any
successor in interest or any successor appointed hereunder, the "Custodian").
WITNESSETH THAT:
WHEREAS, pursuant to the Trust Agreement, dated as of March 29, 2004, among
Structured Asset Mortgage Investments II Inc. ("▇▇▇▇ ▇▇"), Deutsche Bank
National Trust Company, as trustee (the "Trustee"), and Deutsche Bank Trust
Company Delaware, as Delaware trustee (the "Delaware Trustee"), ▇▇▇▇▇▇▇▇▇
Mortgage Securities Trust 2004-1 was formed (the "Trust"), and pursuant to the
Trust, Pooling and Servicing Agreement, dated as of March 1, 2004 (the "Trust,
Pooling and Servicing Agreement"), among ▇▇▇▇ ▇▇, ▇▇▇▇▇ Fargo Bank, N.A.,
▇▇▇▇▇▇▇▇▇ Mortgage Home Loans, Inc., the Trustee and the Delaware Trustee, the
Trust issued ▇▇▇▇▇▇▇▇▇ Mortgage Securities Trust, Mortgage Pass-Through
Certificates, Series 2004-1 and the purchased those certain one- to four-family,
first lien, hybrid and adjustable interest rate mortgage loans (the "Mortgage
Loans"); and
WHEREAS, the Custodian has agreed to act as agent for the Trustee for the
purposes of receiving and holding certain documents and other instruments
delivered by the Company or the Master Servicer under the Trust, Pooling and
Servicing Agreement and by the Servicers under their respective Servicing
Agreements, all upon the terms and conditions and subject to the limitations
hereinafter set forth;
NOW, THEREFORE, in consideration of the premises and the mutual covenants
and agreements hereinafter set forth, the Trustee, the Company, the Master
Servicer and the Custodian hereby agree as follows:
ARTICLE I.
DEFINITIONS
Capitalized terms used in this Agreement and not defined herein shall have
the meanings assigned in the Trust, Pooling and Servicing Agreement, unless
otherwise required by the context herein.
ARTICLE II.
CUSTODY OF MORTGAGE DOCUMENTS
Section 2.1. CUSTODIAN TO ACT AS AGENT: ACCEPTANCE OF MORTGAGE FILES. The
Custodian, as the duly appointed agent of the Trustee for these purposes,
acknowledges (subject to any exceptions noted [in the Certification referred to
in Section 2.3] [in the report attached hereto] receipt of the Mortgage Files
relating to the Mortgage Loans identified on the schedule attached hereto (the
"Mortgage Files") and declares that it holds and will hold such Mortgage Files
as agent for the Trustee, in trust, for the use and benefit of the Trust and all
present and future Certificateholders.
Section 2.2. RECORDATION OF ASSIGNMENTS. If at any time required pursuant
to the provisions of Section 2.01 of the Trust, Pooling and Servicing Agreement,
the Custodian shall deliver all applicable assignments to the Company for the
purpose of recording it in the appropriate public office for real property
records, and the Company, at no expense to the Custodian, shall promptly cause
to be recorded in the appropriate public office for real property records each
such assignment of Mortgage and, upon receipt thereof from such public office,
shall return each such assignment of Mortgage to the Custodian.
Section 2.3. REVIEW OF MORTGAGE FILES.
(a) [If not previously delivered by the Trustee] On or prior to the Closing
Date, in accordance with Section 2.02 of the Trust, Pooling and Servicing
Agreement, the Custodian shall deliver to the Trustee, the Seller and the
Depositor an Initial Certification in the form of Exhibit C-1 to the Trust,
Pooling and Servicing Agreement evidencing receipt (subject to any exceptions
noted therein) of a Mortgage File for each of the Mortgage Loans listed on the
Schedule attached hereto (the "Mortgage Loan Schedule").
(b) [If not previously delivered by the Trustee] Within 90 days of the
Closing Date, the Custodian agrees, for the benefit of Certificateholders, to
review, in accordance with the provisions of Section 2.02 of the Trust, Pooling
and Servicing Agreement, each such document, and shall deliver to the Trustee,
the Seller and the Depositor an Interim Certification in the form of Exhibit C-2
to the Trust, Pooling and Servicing Agreement to the effect that all such
documents have been executed and received and that such documents relate to the
Mortgage Loans identified on the Mortgage Loan Schedule, except for any
exceptions listed on Schedule A attached to such Interim Certification. The
Custodian shall be under no duty or obligation to inspect, review or examine
said documents, instruments, certificates or other papers to determine that the
same are genuine, enforceable, or appropriate for the represented purpose or
that they have actually been recorded or that they are other than what they
purport to be on their face.
(c) [If not previously delivered by the Trustee] Not later than 180 days
after the Closing Date, the Custodian shall review the Mortgage Files as
provided in Section 2.02 of the Trust, Pooling and Servicing Agreement and
deliver to the Trustee, the Seller and the Depositor a Final Certification
substantially in the form of Exhibit C-3 to the Trust, Pooling and Servicing
Agreement evidencing the completeness of the Mortgage Files.
(d) [If applicable] In reviewing the Mortgage Files as provided herein and
in the Trust, Pooling and Servicing Agreement, the Custodian shall make no
representation as to and shall not be responsible to verify (i) the validity,
legality, enforceability, due authorization, recordability, sufficiency or
genuineness of any of the documents included in any Mortgage File or (ii) the
collectibility, insurability, effectiveness or suitability of any of the
documents in any Mortgage File.
Upon receipt of written request from the Trustee, the Custodian shall as
soon as practicable supply the Trustee with a list of all of the documents
relating to the Mortgage Loans then contained in the Mortgage Files.
Section 2.4. NOTIFICATION OF BREACHES OF REPRESENTATIONS AND WARRANTIES.
Upon discovery by the Custodian of a breach of any representation or warranty
made by the Company or the Seller as set forth in the Trust, Pooling and
Servicing Agreement with respect to a Mortgage Loan relating to a Mortgage File,
the Custodian shall give prompt written notice to the Company, the Seller, the
related Servicer and the Trustee.
Section 2.5. CUSTODIAN TO COOPERATE: RELEASE OF MORTGAGE FILES. Upon
receipt of written notice from the Trustee that the Seller has repurchased a
Mortgage Loan pursuant to the Trust, Pooling and Servicing Agreement, and that
the purchase price therefore has been deposited in the Master Servicer
Collection Account or the Distribution Account, then the Custodian agrees to
promptly release to the Seller the related Mortgage File.
Upon the Custodian's receipt of a request for release (a "Request for
Release") substantially in the form of Exhibit D to the Trust, Pooling and
Servicing Agreement signed by a Servicing Officer of the related Servicer
stating that it has received payment in full of a Mortgage Loan or that payment
in full will be escrowed in a manner customary for such purposes, the Custodian
agrees promptly to release to the related Servicer the related Mortgage File.
The Seller shall deliver to the Custodian and the Custodian agrees to accept the
Mortgage Note and other documents constituting the Mortgage File with respect to
any Substitute Mortgage Loan.
From time to time as is appropriate for the servicing or foreclosure of any
Mortgage Loan, including, for this purpose, collection under any Primary
Insurance Policy, the Master Servicer shall cause to the extent required in the
related Servicing Agreement, the related Servicer to deliver to the Custodian a
Request for Release signed by a Servicing Officer requesting that possession of
all of a Mortgage File be released to the related Servicer and certifying as to
the reason for such release and that such release will not invalidate any
insurance coverage provided in respect of the Mortgage Loan under any of the
Insurance Policies. Upon receipt of the foregoing, the Custodian shall deliver
the Mortgage File to the related Servicer. As required by the related Servicing
Agreement, the Master Servicer shall cause the related Servicer to return each
released Mortgage File or any document therein to the Custodian when the need
therefor by the related Servicer no longer exists, unless (i) the Mortgage Loan
has been liquidated and the Liquidation Proceeds relating to the Mortgage Loan
have been deposited in the Master Servicer Collection Account or the
Distribution Account or (ii) 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 the related Servicer has delivered to the Custodian 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.
At any time that a Servicer is required to deliver to the Custodian a
Request for Release, the Master Servicer shall cause the Servicer to deliver two
copies of the Request for Release if delivered in hard copy or the Servicer may
furnish such Request for Release electronically to the Custodian, in which event
the Servicing Officer transmitting the same shall be deemed to have signed the
Request for Release. In connection with any Request for Release of a Mortgage
File because of a repurchase of a Mortgage Loan, such Request for Release shall
be accompanied by an assignment of mortgage, without recourse, from the Trustee
to the Seller and the related Mortgage Note shall be endorsed without recourse
by the Trustee and be returned to the Seller. In connection with any Request for
Release of a Mortgage File because of the payment in full of a Mortgage Loan,
such Request for Release shall be accompanied by a certificate of satisfaction
or other similar instrument to be executed by or on behalf of the Trustee and
returned to the related Servicer.
Section 2.6. ASSUMPTION AGREEMENTS. In the event that any assumption
agreement or substitution of liability agreement is entered into with respect to
any Mortgage Loan subject to this Agreement in accordance with the terms and
provisions of the Trust, Pooling and Servicing Agreement, the Master Servicer,
to the extent provided in the related Servicing Agreement, shall cause the
related Servicer to notify the Custodian that such assumption or substitution
agreement has been completed by forwarding to the Custodian the original of such
assumption or substitution agreement, which shall be added to the related
Mortgage File and, for all purposes, shall be considered a part of such Mortgage
File to the same extent as all other documents and instruments constituting
parts thereof.
ARTICLE III.
CONCERNING THE CUSTODIAN
Section 3.1. CUSTODIAN A BAILEE AND AGENT OF THE TRUSTEE. With respect to
each Mortgage Note, Mortgage and other documents constituting each Mortgage File
which are delivered to the Custodian, the Custodian is exclusively the bailee
and agent of the Trustee and the Trust and has no instructions to hold any
Mortgage Note or Mortgage for the benefit of any person other than the Trustee,
the Trust and the Certificateholders and undertakes to perform such duties and
only such duties as are specifically set forth in this Agreement. Except upon
compliance with the provisions of Section 2.5 of this Agreement, no Mortgage
Note, Mortgage or Mortgage File shall be delivered by the Custodian to the
Company, the Servicers or the Master Servicer or otherwise released from the
possession of the Custodian.
Section 3.2. [Reserved.]
Section 3.3. CUSTODIAN MAY OWN CERTIFICATES. The Custodian in its
individual or any other capacity may become the owner or pledgee of Certificates
with the same rights it would have if it were not Custodian.
Section 3.4. ▇▇▇▇▇▇▇▇▇ TO PAY CUSTODIAN'S FEES AND EXPENSES. ▇▇▇▇▇▇▇▇▇, in
its capacity as Servicer of a substantial portion of the Mortgage Loans, and
pursuant to a letter agreement between ▇▇▇▇▇▇▇▇▇ and the Custodian dated the
date hereof, covenants and agrees to pay to the Custodian from time to time, and
the Custodian shall be entitled to, reasonable compensation for all services
rendered by it in the exercise and performance of any of the powers and duties
hereunder of the Custodian, and ▇▇▇▇▇▇▇▇▇ will pay or reimburse the Custodian
upon its request for all reasonable expenses, disbursements and advances
incurred or made by the Custodian in accordance with any of the provisions of
this Agreement (including the reasonable compensation and the expenses and
disbursements of its counsel and of all persons not regularly in its employ),
except any such expense, disbursement or advance as may arise from its
negligence or bad faith or to the extent that such cost or expense is
indemnified by the Trust pursuant to the Trust, Pooling and Servicing Agreement.
In the event that ▇▇▇▇▇▇▇▇▇ fails to pay the Custodian as provided in such
letter agreement, the Custodian shall be entitled to reimbursement from the
Trust as provided in Section 9.05 of the Trust, Pooling and Servicing Agreement.
Section 3.5. CUSTODIAN MAY RESIGN; TRUSTEE MAY REMOVE CUSTODIAN. The
Custodian may resign from the obligations and duties hereby imposed upon it as
such obligations and duties relate to its acting as Custodian of the Mortgage
Loans. Upon receiving such notice of resignation, the Trustee shall either take
custody of the Mortgage Files itself and give prompt notice thereof to the
Company, the Master Servicer, ▇▇▇▇▇▇▇▇▇ and the Custodian, or promptly appoint a
successor Custodian, reasonably acceptable to ▇▇▇▇▇▇▇▇▇ and the Master Servicer,
by written instrument, in duplicate, one copy of which instrument shall be
delivered to the resigning Custodian and one copy to the successor Custodian. If
the Trustee shall not have taken custody of the Mortgage Files and no successor
Custodian shall have been so appointed and have accepted appointment within 30
days after the giving of such notice of resignation, the resigning Custodian may
petition any court of competent jurisdiction for the appointment of a successor
Custodian.
The Trustee may remove the Custodian at any time with the consent of the
Master Servicer and ▇▇▇▇▇▇▇▇▇. In such event, the Trustee shall appoint, or
petition a court of competent jurisdiction to appoint, a successor Custodian
hereunder. Any successor Custodian shall be a depository institution subject to
supervision or examination by federal or state authority, shall be able to
satisfy the other requirements contained in Section 3.7 and shall be
unaffiliated with any Servicer, ▇▇▇▇▇▇▇▇▇ or the Company.
Any resignation or removal of the Custodian and appointment of a successor
Custodian pursuant to any of the provisions of this Section 3.5 shall become
effective upon acceptance of appointment by the successor Custodian. The Trustee
shall give prompt notice to the Company, ▇▇▇▇▇▇▇▇▇ and the Master Servicer of
the appointment of any successor Custodian. No successor Custodian shall be
appointed by the Trustee without the prior written approval of ▇▇▇▇▇▇▇▇▇ and the
Master Servicer.
Section 3.6. MERGER OR CONSOLIDATION OF CUSTODIAN. Any Person into which
the Custodian may be merged or converted or with which it may be consolidated,
or any Person resulting from any merger, conversion or consolidation to which
the Custodian shall be a party, or any Person succeeding to the business of the
Custodian, shall be the successor of the Custodian hereunder, without the
execution or filing of any paper or any further act on the part of any of the
parties hereto, anything herein to the contrary notwithstanding.
Section 3.7. REPRESENTATIONS OF THE CUSTODIAN. The Custodian hereby
represents that it is a depository institution subject to supervision or
examination by a federal or state authority, has a combined capital and surplus
of at least $15,000,000 and is qualified to do business in the jurisdictions in
which it will hold any Mortgage File.
ARTICLE IV.
MISCELLANEOUS PROVISIONS
Section 4.1. NOTICES. All notices, requests, consents and demands and other
communications required under this Agreement or pursuant to any other instrument
or document delivered hereunder shall be in writing and, unless otherwise
specifically provided, may be delivered personally, by telegram or telex, or by
registered or certified mail, postage prepaid, return receipt requested, at the
addresses specified on the signature page hereof (unless changed by the
particular party whose address is stated herein by similar notice in writing),
in which case the notice will be deemed delivered when received.
Section 4.2. AMENDMENTS. No modification or amendment of or supplement to
this Agreement shall be valid or effective unless the same is in writing and
signed by all parties hereto, and none of the Company, ▇▇▇▇▇▇▇▇▇ the Master
Servicer nor the Trustee shall enter into any amendment hereof except as
permitted by the Trust, Pooling and Servicing Agreement. The Trustee shall give
prompt notice to the Custodian of any amendment or supplement to the Trust,
Pooling and Servicing Agreement and furnish the Custodian with written copies
thereof.
Section 4.3. GOVERNING LAW. THIS AGREEMENT SHALL BE DEEMED A CONTRACT MADE
UNDER THE LAWS OF THE STATE OF NEW YORK AND SHALL BE CONSTRUED AND ENFORCED IN
ACCORDANCE WITH AND GOVERNED BY THE LAWS OF THE STATE OF NEW YORK.
Section 4.4. RECORDATION OF AGREEMENT. To the extent permitted by
applicable law, this Agreement is subject to recordation in all appropriate
public offices for real property records in all the counties or other comparable
jurisdictions in which any or all of the properties subject to the Mortgages are
situated, and in any other appropriate public recording office or elsewhere,
such recordation to be effected by the Company and at the Trust's expense on
direction by the Trustee, but only upon direction accompanied by an Opinion of
Counsel reasonably satisfactory to the Company to the effect that the failure to
effect such recordation is likely to materially and adversely affect 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 4.5. 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.
IN WITNESS WHEREOF, this Agreement is executed as of the date first above
written.
Address: DEUTSCHE BANK NATIONAL TRUST
COMPANY, as Trustee
▇▇▇▇ ▇▇▇▇ ▇▇. ▇▇▇▇▇▇ ▇▇▇▇▇
▇▇▇▇▇ ▇▇▇, ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇
By: ________________________
Attention: ▇▇▇▇▇▇▇▇▇ ▇▇▇▇-▇ (TM0401) Name:
Telecopy: (▇▇▇) ▇▇▇-▇▇▇▇ Title:
Address: STRUCTURED ASSET MORTGAGE
INVESTMENTS, II INC.
▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇
By: ________________________
Name:
Title:
Address: ▇▇▇▇▇ FARGO BANK, N.A.,
as Master Servicer
▇▇▇▇ ▇▇▇ ▇▇▇▇▇▇▇▇▇ ▇▇▇▇
▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇ ▇▇▇▇▇
By: ________________________
Name:
Title:
Address: _________________________,
as Custodian
▇▇▇▇ ▇▇▇ ▇▇▇▇▇▇▇▇▇ ▇▇▇▇
▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇ ▇▇▇▇▇
By: ________________________
Name:
Title:
▇▇▇▇▇▇▇▇▇ MORTGAGE HOME LOANS, INC.
Address:
By: ________________________
▇▇▇ ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇; ▇▇▇▇▇ ▇▇▇ Name:
▇▇▇▇▇ ▇▇, ▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇ Title:
STATE OF )
) ss:
COUNTY OF )
On the__ day of _______ 20__ before me, a notary public in and for said
State, personally appeared _______________, known to me to be a
_________________of Deutsche Bank National Trust Company, a national banking
association that executed the within instrument, and also known to me to be the
person who executed it on behalf of said corporation and acknowledged to me that
such corporation executed the within instrument.
IN WITNESS WHEREOF, I have hereunto set my hand and affixed my official
seal the day and year in this certificate first above written.
______________________________
Notary Public
[SEAL]
STATE OF )
) ss:
COUNTY OF )
On the __ day of ______ 20__ before me, a notary public in and for said
State, personally appeared _________________, known to me to be an _______ of
▇▇▇▇▇ Fargo Bank, N.A., a national banking association that executed the within
instrument, and also known to me to be the person who executed it on behalf of
said national banking association, and acknowledged to me that such national
banking association executed the within instrument.
IN WITNESS WHEREOF, I have hereunto set my hand and affixed my official
seal the day and year in this certificate first above written.
______________________________
Notary Public
[SEAL]
STATE OF )
) ss:
COUNTY OF )
On the __ day of _______ 20__ before me, a notary public in and for said
State, personally appeared _________________, known to me to be a
_________________ of Structured Asset Mortgage Investments II Inc., one of the
corporations that executed the within instrument, and also known to me to be the
person who executed it on behalf of said corporation, and acknowledged to me
that such corporation executed the within instrument.
IN WITNESS WHEREOF, I have hereunto set my hand and affixed my official
seal the day and year in this certificate first above written.
______________________________
Notary Public
[SEAL]
STATE OF )
) ss:
COUNTY OF )
On the __ day of _______ 20__ before me, a notary public in and for said
State, personally appeared ____________________, known to me to be a
__________________of ▇▇▇▇▇ Fargo Bank, N.A., a national banking association that
executed the within instrument, and also known to me to be the person who
executed it on behalf of said corporation, and acknowledged to me that such
corporation executed the within instrument.
IN WITNESS WHEREOF, I have hereunto set my hand and affixed my official
seal the day and year in this certificate first above written.
______________________________
Notary Public
[SEAL]
STATE OF )
) ss:
COUNTY OF )
On the __ day of _______ 20__ before me, a notary public in and for said
State, personally appeared ____________, known to me to be a
_____________________ of ▇▇▇▇▇▇▇▇▇ Mortgage Home Loans, Inc., one of the
corporations that executed the within instrument, and also known to me to be the
person who executed it on behalf of said corporation, and acknowledged to me
that such corporation executed the within instrument.
IN WITNESS WHEREOF, I have hereunto set my hand and affixed my official
seal the day and year in this certificate first above written.
______________________________
Notary Public
[SEAL]
STATE OF )
) ss:
COUNTY OF )
On the __ day of _______ 20__ before me, a notary public in and for said
State, personally appeared ____________________, known to me to be a
____________________ of ___________________________, as Custodian, [one of the
corporations][a national banking association] that executed the within
instrument, and also known to me to be the person who executed it on behalf of
said corporation, and acknowledged to me that such corporation executed the
within instrument.
IN WITNESS WHEREOF, I have hereunto set my hand and affixed my official
seal the day and year in this certificate first above written.
______________________________
Notary Public
[SEAL]
EXHIBIT H
LIST OF SERVICERS AND SERVICING AGREEMENTS
1. Amended and Restated Correspondent Loan Purchase Agreement, dated as of
▇▇▇▇▇ ▇▇, ▇▇▇▇ (▇▇▇ "▇▇▇▇▇ ▇▇▇▇▇▇▇▇ Agreement"), between ▇▇▇▇▇▇▇▇▇ and
First Republic Bank ("First Republic"), including the related Transfer
Notice, dated as of March 18, 2004, from ▇▇▇▇▇▇▇▇▇ to First Republic.
2. Amended and Restated Correspondent Loan Purchase Agreement, dated as of
March 21, 2002, between ▇▇▇▇▇▇▇▇▇ and Colonial Savings, F.A. ("Colonial"),
including the related Transfer Notice, dated as of March 18, 2004, from
▇▇▇▇▇▇▇▇▇ to Colonial.
3. (a) Servicing Agreement, dated as of March 1, 2002, between ▇▇▇▇▇▇▇▇▇, as
seller and servicer, and ▇▇▇▇▇ Fargo, as master servicer, (b) Amendment to
Servicing Agreement, dated as of December 1, 2002, between ▇▇▇▇▇▇▇▇▇, as
seller and servicer, and ▇▇▇▇▇ Fargo, as master servicer, (c) the
Subservicing Acknowledgement Agreement, dated as of March 1, 2002, between
▇▇▇▇▇▇▇▇▇, as servicer, and Cenlar FSB, as sub-servicer ("Cenlar"), and (d)
the Amendment to Sub-Servicing Acknowledgment Agreement, dated as of
December 1, 2002, between ▇▇▇▇▇▇▇▇▇, as servicer, and Cenlar, as
sub-servicer, including the related Transfer Notice, dated as of March 18,
2004, from ▇▇▇▇▇▇▇▇▇, as seller, to ▇▇▇▇▇▇▇▇▇, as servicer, and Cenlar, as
sub-servicer.
4. Seller's Warranties and Servicing Agreement, dated as of February 1, 2004,
between ▇▇▇▇▇ Fargo Home Mortgage, Inc. ("WFHM") and ▇▇▇▇▇▇▇▇▇, as
purchaser, as reconstituted pursuant to the Reconstituted Servicing
Agreement, dated as of March 1, 2004, between ▇▇▇▇▇▇▇▇▇, as seller, and
WFHM, as servicer, and acknowledged by ▇▇▇▇▇ Fargo Bank, N.A. ("▇▇▇▇▇
Fargo"), as master servicer and Deutsche Bank National Trust Company
("Deutsche Bank"), as trustee.
5. (a) Mortgage Flow Purchase, Sale & Servicing Agreement, dated as of
December 23, 2002, by and among ▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇'▇ Gate Residential
Mortgage Trust (formerly known as Cendant Residential Mortgage Trust)
("▇▇▇▇▇▇'▇ Gate") and Cendant Mortgage Corporation ("Cendant"), (b)
Additional Collateral Assignment and Servicing Agreement, dated as of
December 23, 2002, by and among ▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇'▇ Gate and Cendant and
(c) Assignment, Assumption and Recognition Agreement, dated of March 1,
2004, by and among ▇▇▇▇▇▇▇▇▇ Mortgage Securities Trust 2004-1, as assignee,
▇▇▇▇▇▇▇▇▇, as assignor, ▇▇▇▇▇▇'▇ Gate, as a seller, and Cendant, as
servicer and a seller, and acknowledged by ▇▇▇▇▇ Fargo, as master servicer,
and Deutsche Bank, as trustee.
EXHIBIT I
MORTGAGE LOAN PURCHASE AGREEMENT
EXHIBIT J
CERTIFICATE OF TRUST
OF
▇▇▇▇▇▇▇▇▇ MORTGAGE SECURITIES TRUST 2004-1
This Certificate of Trust of ▇▇▇▇▇▇▇▇▇ Mortgage Securities Trust 2004-1
(the "Trust"), dated March 1, 2004 is being duly executed and filed by the
undersigned, as trustees to form a statutory trust under the Delaware Statutory
Trust Act, 12 Del. C. ▇▇.▇▇. 3801 et seq.
1. Name. The name of the statutory trust formed hereby is ▇▇▇▇▇▇▇▇▇
Mortgage Securities Trust 2004-1.
2. Delaware Trustee. The name and the business address of the trustee of
the Trust with a principal place of business in the State of Delaware
and County of New Castle is Deutsche Bank Company Delaware, ▇▇▇▇
▇▇▇▇▇▇ ▇▇▇▇, ▇▇▇▇▇ ▇▇▇, ▇▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇ ▇▇▇▇▇.
IN WITNESS WHEREOF, the undersigned being the only trustees of the Trust,
have executed this Certificate of Trust as of the date first-above written.
Deutsche Bank Trust Company Delaware,
as Delaware Trustee
By: ______________________________
Name:
Title:
Deutsche Bank National Trust Company,
as Trustee
By: ______________________________
Name:
Title:
EXHIBIT K
FORM OF NOTICE OF EXERCISE OF
OPTIONAL SECURITIES PURCHASE RIGHT
Date__________________
[TRUSTEE]
[SECURITIES ADMINISTRATOR]
[RATING AGENCIES]
[MASTER SERVICER]
Re: ▇▇▇▇▇▇▇▇▇ Mortgage Securities Trust 2004-1
Ladies and Gentlemen:
Pursuant to the terms of the Trust, Pooling and Servicing Agreement (the
"Agreement"), dated as of March 1, 2004, among ▇▇▇▇▇▇▇▇▇ Mortgage Home Loans,
Inc., Structured Asset Mortgage Investments II Inc., as depositor, ▇▇▇▇▇ Fargo
Bank, N.A., as master servicer and securities administrator, Deutsche Bank
National Trust Company, as trustee, and Deutsche Bank Trust Company Delaware, as
Delaware trustee, we hereby give notice of our exercise of the Optional
Securities Purchase Right. We intend to purchase the outstanding Certificates
(other than the Class B-IO Certificates) on the Distribution Date in ______
20__. [We appoint __________________ as designee to purchase the Class
[R-1][R-2] Certificates.]
Very truly yours,
▇▇▇▇▇▇▇▇▇ MORTGAGE, INC.
By: ______________________________
Authorized Officer