Exhibit 99.1
Execution Copy
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GSAA HOME EQUITY TRUST 2007-1
ASSET-BACKED CERTIFICATES
SERIES 2007-1
MASTER SERVICING
and
TRUST AGREEMENT
among
GS MORTGAGE SECURITIES CORP.,
Depositor,
U.S. BANK NATIONAL ASSOCIATION,
Trustee
DEUTSCHE BANK NATIONAL TRUST COMPANY,
and
THE BANK OF NEW YORK TRUST COMPANY, NATIONAL ASSOCIATION,
and
U.S. BANK NATIONAL ASSOCIATION,
Custodians
and
▇▇▇▇▇ FARGO BANK, NATIONAL ASSOCIATION,
Master Servicer and Securities Administrator
Dated January 1, 2007
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TABLE OF CONTENTS
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Page
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ARTICLE I
DEFINITIONS
Section 1.01 Definitions...............................................15
ARTICLE II
CONVEYANCE OF MORTGAGE LOANS; REPRESENTATIONS AND WARRANTIES
Section 2.01 Conveyance of Mortgage Loans..............................48
Section 2.02 Acceptance by the Custodians of the Mortgage Loans........50
Section 2.03 Execution and Delivery of Certificates....................52
Section 2.04 REMIC Matters.............................................52
Section 2.05 Representations and Warranties of the Depositor...........53
Section 2.06 Representations and Warranties of BNY.....................54
Section 2.07 Representations and Warranties of Deutsche Bank...........55
Section 2.08 Representations and Warranties of U.S. Bank...............55
ARTICLE III
TRUST ACCOUNTS
Section 3.01 Excess Reserve Fund Account; Distribution Account.........56
Section 3.02 Investment of Funds in the Distribution Account...........58
ARTICLE IV
DISTRIBUTIONS
Section 4.01 Priorities of Distribution................................59
Section 4.02 Monthly Statements to Certificateholders..................65
Section 4.03 Allocation of Applied Realized Loss Amounts...............68
Section 4.04 Certain Matters Relating to the Determination of LIBOR....68
Section 4.05 Supplemental Interest Trust...............................69
Section 4.06 Trust's Obligations under the Interest Rate Swap
Agreement; Replacement and Termination of the
Interest Rate Swap Agreement..............................70
ARTICLE V
THE CERTIFICATES
Section 5.01 The Certificates..........................................71
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Section 5.02 Certificate Register; Registration of Transfer
and Exchange of Certificates..............................72
Section 5.03 Mutilated, Destroyed, Lost or Stolen Certificates.........77
Section 5.04 Persons Deemed Owners.....................................77
Section 5.05 Access to List of Certificateholders' Names
and Addresses.............................................78
Section 5.06 Maintenance of Office or Agency...........................78
ARTICLE VI
THE DEPOSITOR
Section 6.01 Liabilities of the Depositor..............................78
Section 6.02 Merger or Consolidation of the Depositor..................78
Section 6.03 Limitation on Liability of the Depositor and Others.......79
Section 6.04 Servicing Compliance Review...............................79
Section 6.05 Option to Purchase Defaulted Mortgage Loans...............79
ARTICLE VII
SERVICER DEFAULT
Section 7.01 Events of Default.........................................80
Section 7.02 Master Servicer to Act; Appointment of Successor..........80
Section 7.03 Master Servicer to Act as Servicer........................81
Section 7.04 Notification to Certificateholders........................82
ARTICLE VIII
CONCERNING THE TRUSTEE AND THE CUSTODIANS
Section 8.01 Duties of the Trustee and the Custodians..................82
Section 8.02 [Reserved]................................................83
Section 8.03 Certain Matters Affecting the Trustee and the Custodians..83
Section 8.04 Trustee and Custodians Not Liable for Certificates
or Mortgage Loans.........................................84
Section 8.05 Trustee May Own Certificates..............................85
Section 8.06 Trustee's Fees and Expenses...............................85
Section 8.07 Eligibility Requirements for the Trustee..................86
Section 8.08 Resignation and Removal of the Trustee....................87
Section 8.09 Successor Trustee.........................................87
Section 8.10 Merger or Consolidation of the Trustee or the Custodians..88
Section 8.11 Appointment of Co-Trustee or Separate Trustee.............88
Section 8.12 Tax Matters...............................................89
Section 8.13 [Reserved]................................................92
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Section 8.14 Tax Classification of the Excess Reserve Fund Account
and the Interest Rate Swap Agreement......................92
Section 8.15 Custodial Responsibilities................................93
ARTICLE IX
ADMINISTRATION OF THE MORTGAGE LOANS BY THE MASTER SERVICER
Section 9.01 Duties of the Master Servicer; Enforcement of
Servicer's Obligations....................................95
Section 9.02 Maintenance of Fidelity Bond and Errors and
Omissions Insurance.......................................96
Section 9.03 Representations and Warranties of the Master Servicer.....96
Section 9.04 Master Servicer Events of Default.........................98
Section 9.05 Waiver of Default........................................100
Section 9.06 Successor to the Master Servicer.........................100
Section 9.07 Compensation of the Master Servicer......................102
Section 9.08 Merger or Consolidation..................................102
Section 9.09 Resignation of the Master Servicer.......................102
Section 9.10 Assignment or Delegation of Duties by the Master
Servicer.................................................102
Section 9.11 Limitation on Liability of the Master Servicer...........103
ARTICLE X
CONCERNING THE SECURITIES ADMINISTRATOR
Section 10.01 Duties of the Securities Administrator. The Securities
Administrator shall undertake to perform such duties
and only such duties as are specifically set forth in
this Agreement...........................................104
Section 10.02 Certain Matters Affecting the Securities Administrator...105
Section 10.03 Securities Administrator Not Liable for Certificates
or Mortgage Loans........................................107
Section 10.04 Securities Administrator May Own Certificates............107
Section 10.05 Securities Administrator's Fees and Expenses.............107
Section 10.06 Eligibility Requirements for the Securities
Administrator............................................108
Section 10.07 Resignation and Removal of the Securities Administrator..109
Section 10.08 Successor Securities Administrator.......................110
Section 10.09 Merger or Consolidation of the Securities Administrator..111
Section 10.10 Assignment or Delegation of Duties by the Securities
Administrator............................................111
ARTICLE XI
TERMINATION
Section 11.01 Termination upon Liquidation or Purchase of the
Mortgage Loans...........................................111
Section 11.02 Final Distribution on the Certificates...................112
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Section 11.03 Additional Termination Requirements......................114
ARTICLE XII
MISCELLANEOUS PROVISIONS
Section 12.01 Amendment................................................114
Section 12.02 Recordation of Agreement; Counterparts...................117
Section 12.03 Governing Law............................................117
Section 12.04 Intention of Parties.....................................117
Section 12.05 Notices..................................................117
Section 12.06 Severability of Provisions...............................119
Section 12.07 Limitation on Rights of Certificateholders...............119
Section 12.08 Certificates Nonassessable and Fully Paid................120
Section 12.09 Waiver of Jury Trial.....................................120
Section 12.10 Rights of the Swap Provider..............................120
ARTICLE XIII
ARTICLE XIII EXCHANGE ACT REPORTING
Section 13.01 Filing Obligations.......................................120
Section 13.02 Form 8-K Filings.........................................121
Section 13.03 Form 10-D Filings........................................123
Section 13.04 Form 10-K Filings........................................124
Section 13.05 Form 15 Filing...........................................126
Section 13.06 ▇▇▇▇▇▇▇▇-▇▇▇▇▇ Certification.............................126
Section 13.07 Report on Assessment of Compliance and Attestation.......127
Section 13.08 Use of Subservicers and Subcontractors...................128
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SCHEDULES
Schedule I Mortgage Loan Schedule
EXHIBITS
Exhibit A Form of Class A, Class M and Class B Certificates
Exhibit B Form of Class P Certificates
Exhibit C Form of Class R, Class RC and Class RX Certificates
Exhibit D Form of Class X Certificate
Exhibit E Form of Initial Certification of Custodian
Exhibit F Form of Document Certification and Exception Report of
Custodian
Exhibit G Form of Residual Transfer Affidavit
Exhibit H Form of Transferor Certificate
Exhibit I Form of Rule 144A Letter
Exhibit J-1 Form of Back-up Certification (Master Servicer)
Exhibit J-2 Form of Back-up Certification (Securities Administrator)
Exhibit K Form of Servicing Criteria to be Addressed in Assessment
of Compliance Statement
Exhibit L Form of Request for Release of Documents (U.S. Bank National
Trust Company)
Exhibit L-1 Form of Request for Release of Documents (Deutsche Bank
National Trust Company)
Exhibit L-2 Form of Request for Release of Documents (The Bank of New
York Trust Company, National Association)
Exhibit M Form 8-K Disclosure Information
Exhibit N Additional Form 10-D Disclosure
Exhibit O Additional Form 10-K Disclosure
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Exhibit P Form of Master Loan Purchase Agreement, between various
sellers and ▇▇▇▇▇▇▇ ▇▇▇▇▇ Mortgage Company
Exhibit Q Flow Servicing Agreement, dated as of January 1, 2006,
between Avelo Mortgage, L.L.C. and ▇▇▇▇▇▇▇ Sachs Mortgage
Company
Exhibit R Servicing Agreement, dated as of July 1, 2004, between
Countrywide Home Loans Servicing LP and ▇▇▇▇▇▇▇ ▇▇▇▇▇
Mortgage Company
Exhibit S Master Mortgage Loan Purchase Agreement, dated as of July
1, 2004, between Countrywide Home Loans, Inc. and ▇▇▇▇▇▇▇
Sachs Mortgage Company
Exhibit T Amendment Reg AB, dated as of January 1, 2006, between
▇▇▇▇▇▇▇ ▇▇▇▇▇ Mortgage Company and Countrywide Home Loans,
Inc.
Exhibit U Amended and Restated Master Mortgage Loan Purchase
Agreement, dated as of November 1, 2005, between
GreenPoint Mortgage Funding, Inc. and ▇▇▇▇▇▇▇ Sachs
Mortgage Company
Exhibit V Servicing Agreement, dated as of November 1, 2005, between
GreenPoint Mortgage Funding, Inc. and ▇▇▇▇▇▇▇ ▇▇▇▇▇
Mortgage Company
Exhibit W The Seller's Purchase, Warranties and Servicing Agreement,
dated as of April 1, 2006, between ▇▇▇▇▇▇▇ Sachs Mortgage
Company and Wachovia Mortgage Corporation
vi
THIS MASTER SERVICING AND TRUST AGREEMENT, dated as of January 1,
2007 (this "Agreement"), is hereby executed by and among GS MORTGAGE
SECURITIES CORP., a Delaware corporation (the "Depositor"), U.S. BANK NATIONAL
ASSOCIATION ("U.S. Bank"), as trustee (in such capacity, the "Trustee") and as
a custodian, DEUTSCHE BANK NATIONAL TRUST COMPANY ("Deutsche Bank"), as a
custodian, THE BANK OF NEW YORK TRUST COMPANY, NATIONAL ASSOCIATION ("BNY"),
as a custodian (Deutsche Bank, BNY and U.S. Bank, each as a "Custodian" and
together the "Custodians") and ▇▇▇▇▇ FARGO BANK, NATIONAL ASSOCIATION ("▇▇▇▇▇
Fargo"), as master servicer (in such capacity, the "Master Servicer") and as
securities administrator (in such capacity, the "Securities Administrator").
W I T N E S S E T H:
- - - - - - - - - -
In consideration of the mutual agreements herein contained, the
parties hereto agree as follows:
PRELIMINARY STATEMENT
The Securities Administrator on behalf of the Trust shall elect that
four segregated asset pools within the Trust Fund be treated for federal
income tax purposes as comprising four REMICs (each, a "Trust REMIC" or, in
the alternative, the "Lower-Tier REMIC", the "Middle-Tier REMIC", the
"Upper-Tier REMIC" and the "Class X REMIC", respectively). The Class UT-Swap
IO Interest, the Class X Interest and each Class of LIBOR Certificates (other
than the right of each Class of LIBOR Certificates to receive Tax Basis Risk
Carry Forward Amounts), represents ownership of a regular interest in the
Upper-Tier REMIC for purposes of the REMIC Provisions. The Class R
Certificates represent ownership of the sole class of residual interest in the
Upper-Tier REMIC, the Class RC Certificates represent ownership of the sole
class of residual interest in the Lower-Tier REMIC and the Middle-Tier REMIC,
and the Class RX Certificates represent ownership of the sole class of
residual interest in the Class X REMIC for purposes of the REMIC Provisions.
The Startup Day for each REMIC described herein is the Closing Date. The
latest possible maturity date for each Certificate is the latest date
referenced in Section 2.04. The Class X REMIC shall hold as assets the Class X
Interest and the Class UT-Swap-IO Interest as set out below. The Upper-Tier
REMIC shall hold as assets the several classes of uncertificated Middle-Tier
Regular Interests, set out below. The Middle-Tier REMIC shall hold as assets
the several classes of uncertificated Lower-Tier Regular Interests, set out
below. The Lower-Tier REMIC shall hold as assets the assets described in the
definition of "Trust Fund" herein (other than the Prepayment Premiums and the
Excess Reserve Fund Account). Each Lower-Tier Regular Interest is hereby
designated as a regular interest in the Lower-Tier REMIC. Each Middle-Tier
Regular Interest is hereby designated as a regular interest in the Middle-Tier
REMIC. The Class MT-1A1, Class MT-1A2, Class MT-2A1A, Class MT-2A1B, Class
MT-A4A, Class MT-A4B, Class MT-M1, Class MT-M2, Class MT-M3, Class MT-M4,
Class MT-M5, Class MT-M6, Class MT-B1, Class MT-B2 and Class MT-B3 Interests
are hereby designated the MT-Accretion Directed Classes (the "MT Accretion
Directed Classes"). The Class P Certificates represent beneficial ownership of
the Prepayment Premiums, each Class of Certificates (excluding the Class P,
Class X and each class of Residual Certificates) represents beneficial
ownership of a regular interest in the Upper-Tier REMIC and
1
the right to receive Tax Basis Risk Carry Forward Amounts and the Class X
Certificates represent beneficial ownership of a regular interest in the Class
X REMIC and the Excess Reserve Fund Account, which portions of the Trust Fund
shall be treated as a grantor trust.
The Lower-Tier REMIC
The Lower-Tier REMIC Interests will have the Initial Principal
Balances and Pass-Through Rates as set forth in the following table:
Lower-Tier REMIC Initial Principal Pass-Through
Interests Balance(1) Rate
--------- ------- ----
Class LT-1A (1) (2)
Class LT-1B (1) (2)
Class LT-2A (1) (2)
Class LT-2B (1) (2)
Class LT-3A (1) (2)
Class LT-3B (1) (2)
Class LT-4A (1) (2)
Class LT-4B (1) (2)
Class LT-5A (1) (2)
Class LT-5B (1) (2)
Class LT-6A (1) (2)
Class LT-6B (1) (2)
Class LT-7A (1) (2)
Class LT-7B (1) (2)
Class LT-8A (1) (2)
Class LT-8B (1) (2)
Class LT-9A (1) (2)
Class LT-9B (1) (2)
Class LT-10A (1) (2)
Class LT-10B (1) (2)
Class LT-11A (1) (2)
Class LT-11B (1) (2)
Class LT-12A (1) (2)
Class LT-12B (1) (2)
Class LT-13A (1) (2)
Class LT-13B (1) (2)
Class LT-14A (1) (2)
Class LT-14B (1) (2)
Class LT-15A (1) (2)
Class LT-15B (1) (2)
Class LT-16A (1) (2)
Class LT-16B (1) (2)
Class LT-17A (1) (2)
Class LT-17B (1) (2)
Class LT-18A (1) (2)
2
Lower-Tier REMIC Initial Principal Pass-Through
Interests Balance(1) Rate
--------- ------- ----
Class LT-18B (1) (2)
Class LT-19A (1) (2)
Class LT-19B (1) (2)
Class LT-20A (1) (2)
Class LT-20B (1) (2)
Class LT-21A (1) (2)
Class LT-21B (1) (2)
Class LT-22A (1) (2)
Class LT-22B (1) (2)
Class LT-23A (1) (2)
Class LT-23B (1) (2)
Class LT-24A (1) (2)
Class LT-24B (1) (2)
Class LT-25A (1) (2)
Class LT-25B (1) (2)
Class LT-26A (1) (2)
Class LT-26B (1) (2)
Class LT-27A (1) (2)
Class LT-27B (1) (2)
Class LT-28A (1) (2)
Class LT-28B (1) (2)
Class LT-29A (1) (2)
Class LT-29B (1) (2)
Class LT-30A (1) (2)
Class LT-30B (1) (2)
Class LT-31A (1) (2)
Class LT-31B (1) (2)
Class LT-32A (1) (2)
Class LT-32B (1) (2)
Class LT-33A (1) (2)
Class LT-33B (1) (2)
Class LT-34A (1) (2)
Class LT-34B (1) (2)
Class LT-35A (1) (2)
Class LT-35B (1) (2)
Class LT-36A (1) (2)
Class LT-36B (1) (2)
Class LT-37A (1) (2)
Class LT-37B (1) (2)
Class LT-38A (1) (2)
Class LT-38B (1) (2)
Class LT-39A (1) (2)
Class LT-39B (1) (2)
Class LT-40A (1) (2)
3
Lower-Tier REMIC Initial Principal Pass-Through
Interests Balance(1) Rate
--------- ------- ----
Class LT-40B (1) (2)
Class LT-41A (1) (2)
Class LT-41B (1) (2)
Class LT-42A (1) (2)
Class LT-42B (1) (2)
Class LT-43A (1) (2)
Class LT-43B (1) (2)
Class LT-44A (1) (2)
Class LT-44B (1) (2)
Class LT-45A (1) (2)
Class LT-45B (1) (2)
Class LT-46A (1) (2)
Class LT-46B (1) (2)
Class LT-47A (1) (2)
Class LT-47B (1) (2)
Class LT-48A (1) (2)
Class LT-48B (1) (2)
Class LT-49A (1) (2)
Class LT-49B (1) (2)
Class LT-50A (1) (2)
Class LT-50B (1) (2)
Class LT-51A (1) (2)
Class LT-51B (1) (2)
Class LT-52A (1) (2)
Class LT-52B (1) (2)
Class LT-53A (1) (2)
Class LT-53B (1) (2)
Class LT-54A (1) (2)
Class LT-54B (1) (2)
Class LT-55A (1) (2)
Class LT-55B (1) (2)
Class LT-56A (1) (2)
Class LT-56B (1) (2)
Class LT-57A (1) (2)
Class LT-57B (1) (2)
Class LT-58A (1) (2)
Class LT-58B (1) (2)
Class LT-59A (1) (2)
Class LT-59B (1) (2)
Class LT-60A (1) (2)
Class LT-60B (1) (2)
Class LT-Support (1), (3) (2)
Class LT-Group I (4) (4)
Class LT-Group II (5) (5)
4
Lower-Tier REMIC Initial Principal Pass-Through
Interests Balance(1) Rate
--------- ------- ----
------------------
(1) Each such Class, other than the Class LT-Support Interest, will have
an initial principal balance equal to the product of: (i) 50% and
(ii) the excess of (a) the notional balance of the Interest Rate Swap
Agreement for the Distribution Date whose ordinal number equals the
cardinal number of the designated Class, over (b) the notional
balance of the Interest Rate Swap Agreement for the subsequent
Distribution Date. Scheduled principal, prepayments and Realized
Losses will be allocated first, to the Class LT-Support Interest and
second, among the other Classes designated "LT-", first, sequentially
to the Class having the lowest cardinal number following such
designation, in each case until reduced to zero, and second, among
each class having the same cardinal number pro rata between each such
class.
(2) On each Distribution Date, the interest rate will be the Weighted
Average of the Adjusted Net Mortgages Rates then in effect on the
beginning of the related Due Period on the Mortgage Loans ("Pool
WAC").
(3) On each Distribution Date, following the allocation of Principal
Amounts and Realized Losses, the principal balance in respect of the
Class LT-Support Interest will equal the excess, if any, of the
principal balance of the Mortgage Loans over the principal balance in
respect of the remaining Lower-Tier REMIC Interests designated as
"LT-".
(4) On each Distribution Date, following the allocation of Principal
Amounts and Realized Losses, the principal balance in respect of the
Class LT-Group I Interest will be 0.001% of the aggregated Stated
Principal Balance of Group I Mortgage Loans. On each Distribution
Date, the interest rate will be the Weighted Average of the Adjusted
Net Mortgages Rates then in effect on the beginning of the related
Due Period on the Group I Mortgage Loans ("Group I Loan WAC").
(5) On each Distribution Date, following the allocation of Principal
Amounts and Realized Losses, the principal balance in respect of the
Class LT-Group II Interest will be 0.001% of the aggregated Stated
Principal Balance of Group II Mortgage Loans. On each Distribution
Date, the interest rate will be the Weighted Average of the Adjusted
Net Mortgages Rates then in effect on the beginning of the related
Due Period on the Group II Mortgage Loans ("Group II Loan WAC").
In addition to issuing the Lower-Tier Regular Interests, the
Lower-Tier REMIC shall issue the Class R-1 Interest which shall be the sole
class of residual interests in the Lower-Tier REMIC. The Class RC Certificates
will represent ownership of the Class R-1 Interest and will be issued as a
single certificate in definitive form in a principal amount of $100 and shall
have no interest rate. Amounts received by the Class R-1 Interest shall be
deemed paid from the Lower-Tier REMIC.
5
The Middle-Tier REMIC
Corresponding
Middle-Tier Interest Middle-Tier Initial Middle-Tier Principal Upper-Tier
Designation Interest Rate Amount REMIC Class
-------------------- ------------- ---------------------------------------- -------------
Class MT-1A1 (1) 1/2 initial Class Certificate Balance of 1A1
Corresponding Upper-Tier REMIC Regular
Interest
Class MT-1A2 (1) 1/2 initial Class Certificate Balance of 1A2
Corresponding Upper-Tier REMIC Regular
Interest
Class MT-2A1A (1) 1/2 initial Class Certificate Balance of 2A1A
Corresponding Upper-Tier REMIC Regular
Interest
Class MT-2A1B (1) 1/2 initial Class Certificate Balance of 2A1B
Corresponding Upper-Tier REMIC Regular
Interest
Class MT-A4A (1) 1/2 initial Class Certificate Balance of A4A
Corresponding Upper-Tier REMIC Regular
Interest
Class MT-A4B (1) 1/2 initial Class Certificate Balance of A4B
Corresponding Upper-Tier REMIC Regular
Interest
Class MT-M1 (1) 1/2 initial Class Certificate Balance of M1
Corresponding Upper-Tier REMIC Regular
Interest
Class MT-M2 (1) 1/2 initial Class Certificate Balance of M2
Corresponding Upper-Tier REMIC Regular
Interest
Class MT-M3 (1) 1/2 initial Class Certificate Balance of M3
Corresponding Upper-Tier REMIC Regular
Interest
Class MT-M4 (1) 1/2 initial Class Certificate Balance of M4
Corresponding Upper-Tier REMIC Regular
Interest
Class MT-M5 (1) 1/2 initial Class Certificate Balance of M5
Corresponding Upper-Tier REMIC Regular
Interest
Class MT-M6 (1) 1/2 initial Class Certificate Balance of M6
Corresponding Upper-Tier REMIC Regular
Interest
Class MT-B1 (1) 1/2 initial Class Certificate Balance of B1
Corresponding Upper-Tier REMIC Regular
Interest
6
Corresponding
Middle-Tier Interest Middle-Tier Initial Middle-Tier Principal Upper-Tier
Designation Interest Rate Amount REMIC Class
-------------------- ------------- ---------------------------------------- -------------
Class MT-B2 (1) 1/2 initial Class Certificate Balance of B2
Corresponding Upper-Tier REMIC Regular
Interest
Class MT-Accrual (1) 1/2 Pool Stated Principal Balance plus 1/2 N/A
Overcollateralized Amount, less aggregate
initial Middle Tier Principal Amounts of
Class MT-Group I and Class MT-Group II
Interests
Class MT-Group I (2) 0.001% aggregated Stated Principal Balance N/A
of Group I Mortgage Loans(4)
Class MT-Group II (3) 0.001% aggregated Stated Principal Balance N/A
of Group II Mortgage Loans(4)
Class MT-Swap IO (5) (5) N/A
-------------------
(1) The interest rate with respect to any Distribution Date for these
interests will equal the weighted average of the pass through rates
of the Lower-Tier REMIC Interests treating: (i) each "A" class (e.g.
▇▇-▇▇, ▇▇-▇▇, ▇▇-▇▇ ...) as subject to a cap and a floor equal to the
product of 2 and Pool WAC minus the product of two and the Fixed Rate
(as defined in the Interest Rate Swap Agreement) and (ii) each "B"
class (e.g. LT-1B, LT-2B, LT-3B ...) as subject to a cap and a floor
rate equal to the product of 2 and One Month LIBOR, in each case
whose cardinal number preceding such designation (▇.▇. -▇, -▇,
-▇,...) is not exceeded by the ordinal number of the Distribution
Date following the Closing Date (e.g. first, second, third,...) for
such Distribution Date (the "Tax WAC Cap").
(2) The interest rate with respect to any Distribution Date for the Class
MT-Group I Interest will equal the weighted average of the pass
through rates of the Lower-Tier REMIC Interests treating: (i) each
"A" class (e.g. ▇▇-▇▇, ▇▇-▇▇, ▇▇-▇▇ ...) as subject to a cap and a
floor equal to the product of 2 and Group I Loan WAC minus the
product of two and the Fixed Rate (as defined in the Interest Rate
Swap Agreement) and (ii) each "B" class (e.g. LT-1B, LT-2B, LT-3B
...) as subject to a cap and a floor rate equal to the product of 2
and One Month LIBOR, in each case whose cardinal number preceding
such designation (▇.▇. -▇, -▇, -▇,...) is not exceeded by the ordinal
number of the Distribution Date following the Closing Date (e.g.
first, second, third,...) for such Distribution Date (the "Tax Loan
Group I Cap").
(3) The interest rate with respect to any Distribution Date for the Class
MT-Group II Interest will equal the weighted average of the pass
through rates of the Lower-Tier REMIC
7
Interests treating: (i) each "A" class (e.g. ▇▇-▇▇, ▇▇-▇▇, ▇▇-▇▇
...) as subject to a cap and a floor equal to the product of 2 and
Group II Loan WAC minus the product of two and the Fixed Rate (as
defined in the Interest Rate Swap Agreement) and (ii) each "B" class
(e.g. LT-1B, LT-2B, LT-3B ...) as subject to a cap and a floor rate
equal to the product of 2 and One Month LIBOR, in each case whose
cardinal number preceding such designation (▇.▇. -▇, -▇, -▇,...) is
not exceeded by the ordinal number of the Distribution Date
following the Closing Date (e.g. first, second, third,...) for such
Distribution Date (the "Tax Loan Group II Cap").
(4) For all Distribution Dates, the Middle Tier Principal Amount of
these Middle Tier Regular Interests shall be rounded to eight
decimal places.
(5) For each Distribution Date, the interest rate will equal the excess
of the product of two and the Fixed Rate (as defined in the Interest
Rate Swap Agreement) over one month LIBOR on a notional balance equal
to the sum of the principal balances of each Lower-Tier REMIC Regular
Interests whose cardinal number following such designation (▇.▇. -▇,
-▇, -▇,...) is not exceeded by the ordinal number of the Distribution
Date following the Closing Date (e.g. first, second, third,...) for
such Distribution Date.
The Middle-Tier REMIC shall hold as assets all of the Middle-Tier
REMIC Regular Interests.
On each Distribution Date, 50% of the increase in the
Overcollateralized Amount will be payable as a reduction of the Middle-Tier
Principal Amount of the MT-Accretion Directed Classes (each such Class will be
reduced by an amount equal to 50% of any increase in the Overcollateralized
Amount that is attributable to a reduction in the Class Certificate Balance of
its Corresponding Class) and will be accrued and added to the Middle-Tier
Principal Amount of the Class MT-Accrual Interest. On each Distribution Date,
the increase in the Middle-Tier Principal Amount of the Class MT-Accrual
Interest may not exceed interest accruals for such Distribution Date for the
Class MT-Accrual Interest. In the event that: (i) 50% of the increase in the
Overcollateralized Amount exceeds (ii) interest accruals on the Class
MT-Accrual Interest for such Distribution Date, the excess for such
Distribution Date (accumulated with all such excesses for all prior
Distribution Dates) will be added to any increase in the Overcollateralized
Amount for purposes of determining the amount of interest accrual on the Class
MT-Accrual Interest payable as principal on the MT-Accretion Directed Classes
on the next Distribution Date pursuant to the first sentence of this
paragraph. All payments of scheduled principal and prepayments of principal
generated by the Mortgage Loans shall be allocated (i) 50% to the Class
MT-Accrual Interest, the Class MT-Group I Interest and the Class MT-Group II
Interest (and further allocated among these Middle Tier Regular Interests in
the manner described below) and (ii) 50% to the MT-Accretion Directed Classes
(principal payments shall be allocated among such MT-Accretion Directed
Classes in an amount equal to 50% of the principal amounts allocated to their
respective Corresponding Classes), until paid in full. Notwithstanding the
above, principal payments allocated to the Class X Interest that result in the
reduction in the Overcollateralized Amount shall be allocated to the Class
MT-Accrual Interest (until paid in full). Realized Losses shall be applied so
that after all distributions have been made on each Distribution Date (i) the
Middle-Tier Principal Amount of each of the MT-Accretion Directed Classes is
equal to 50% of the Class Certificate Balance of its Corresponding Class, and
(ii) the
8
Class MT-Accrual Interest, the Class MT-Group I Interest and the Class
MT-Group II Interest (and further allocated among these Middle Tier Regular
Interests in the manner described below) are equal to 50% of the aggregate
Stated Principal Balance of the Mortgage Loans plus 50% of the
Overcollateralized Amount. As among the Class MT-Accrual Interest, the Class
MT-Group I Interest and the Class MT-Group II Interest, all payments of
scheduled principal and prepayments of principal generated by the Mortgage
Loans, and all Realized Losses, allocable to such Middle Tier Regular
Interests shall be allocated (i) to the Class MT-Group I Interest and the
Class MT-Group II Interest, each from the related Loan Group so that their
respective Middle Tier Principal Amounts (computed to at least eight decimal
places) are equal to 0.001% of the aggregate Stated Principal Balance of the
Mortgage Loans in the related Loan Group and (ii) the remainder of such
Realized Losses to the Class MT-Accrual Interest.
In addition to issuing the Middle-Tier Regular Interests, the
Middle-Tier REMIC shall issue the Class R-2 Interest which shall be the sole
class of residual interests in the Middle-Tier REMIC. The Class RC
Certificates will represent ownership of the Class R-2 Interest and will be
issued as a single certificate in definitive form in a principal amount of
$100 and shall have no interest rate. Amounts received by the Class R-2
Interest shall be deemed paid from the Middle-Tier REMIC.
The Upper-Tier REMIC
The Upper-Tier REMIC shall issue the following classes of Upper-Tier
Regular Interests, and each such interest, other than the Class UT-R Interest,
is hereby designated as a regular interest in the Upper-Tier REMIC.
Initial Upper-Tier
Upper-Tier Interest Rate Principal Amount and
Upper-Tier and Corresponding Class Corresponding Class Corresponding Class
Class Designation Pass-Through Rate Certificate Balance of Certificates
-------------------- --------------------------- ------------------------ -----------------------
Class 1A1 (1) $ 515,268,000 Class 1A1(18)
Class 1A2 (2) $ 199,818,000 Class 1A2(18)
Class 2A1A (3) $ 82,495,000 Class 2A1A(18)
Class 2A1B (4) $ 9,167,000 Class 2A1B(18)
Class A4A(5) (6) $ 158,851,000 Class A4A(18)
Class A4B(5) (7) $ 17,651,000 Class A4B(18)
Class M1 (8) $ 13,715,000 Class M1(18)
Class M2 (9) $ 12,659,000 Class M2(18)
Class M3 (10) $ 7,913,000 Class M3(18)
Class M4 (11) $ 5,802,000 Class M4(18)
Class M5 (12) $ 5,275,000 Class M5(18)
Class M6 (13) $ 5,275,000 Class M6(18)
Class B1 (14) $ 5,275,000 Class B1(18)
Class B2 (15) $ 5,275,000 Class B2(18)
Class B3 (16) $ 5,275,000 Class B3(18)
Class X (17) (17) Class X(18)
Class UT-Swap IO (19) (19) Class X(19)
9
(1) The Class 1A1 Interest will bear interest during each Interest
Accrual Period at a per annum rate equal to the least of (i)
one-month LIBOR plus 0.080% (0.160% after the first distribution date
on which the optional clean-up call is exercisable), (ii) the Tax
Loan Group I Cap and (iii) the Tax WAC Cap.
(2) The Class 1A2 Interest will bear interest during each Interest
Accrual Period at a per annum rate equal to the least of (i)
one-month LIBOR plus 0.170% (0.340% after the first distribution date
on which the optional clean-up call is exercisable), (ii) the Tax
Loan Group I Cap and (iii) the Tax WAC Cap.
(3) The Class 2A1A Interest will bear interest during each Interest
Accrual Period at a per annum rate equal to the least of (i)
one-month LIBOR plus 0.060% (0.120% after the first distribution date
on which the optional clean-up call is exercisable), (ii) the Tax
Loan Group II Cap and (iii) the Tax WAC Cap.
(4) The Class 2A1B Interest will bear interest during each Interest
Accrual Period at a per annum rate equal to the least of (i)
one-month LIBOR plus 0.100% (0.200% after the first distribution date
on which the optional clean-up call is exercisable), (ii) the Tax
Loan Group II Cap and (iii) the Tax WAC Cap.
(5) The Class A4A and Class A4B Interests are comprised of component
classes. The Class A4A Interests are comprised of the 1A3A and 2A2A
components and the Class A4B Interests are comprised of the 1A3B and
2A2B components. Each component class constitutes a single class of
certificates. The components comprising each of the Class A4A and
Class A4B Interests will not be separately transferable from such
class and are not issued separately. The component balances are as
follows:
----------------------------------------------------------------------
Certificate Class Component Designations Component Balance
----------------------------------------------------------------------
▇▇▇ ▇▇▇▇ $140,852,000
----------------------------------------------------------------------
▇▇▇ ▇▇▇▇ $17,999,000
----------------------------------------------------------------------
▇▇▇ ▇▇▇▇ $15,651,000
----------------------------------------------------------------------
▇▇▇ ▇▇▇▇ $2,000,000
----------------------------------------------------------------------
(6) The Class A4A Interest will bear interest during each Interest
Accrual Period based on the interest rates of its components, which
is (A) the 1A3A interest of a per annum rate equal to the lesser
of (i) one-month LIBOR plus 0.230% (0.460% after the first
distribution date on which the optional clean-up call is
exercisable), and (ii) the Tax WAC Cap and (B) the 2A2A of a per
annum rate equal to the lesser of (i) one-month LIBOR plus 0.230%
(0.460% after the first distribution date on which the optional
clean-up call is exercisable), and (ii) the WAC Cap.
(7) The Class A4B Interest will bear interest during each Interest
Accrual Period based on the interest rates of its components,
which is (A) the 1A3B interest of a per annum rate equal to the
lesser of (i) one-month LIBOR plus 0.250% (0.500% after the first
distribution date
10
on which the optional clean-up call is exercisable), Loan Group I
Cap and (ii) the Tax WAC Cap and (B) the 2A2B interest of a per
annum rate equal to the lesser of (i) one-month LIBOR plus 0.250%
(0.500% after the first distribution date on which the optional
clean-up call is exercisable), (ii) the Tax Loan Group II Cap and
(iii) the Tax WAC Cap.
(8) The Class M1 Interest will bear interest during each Interest Accrual
Period at a per annum rate equal to lesser of (i) one-month LIBOR
plus 0.260% (0.390% after the first distribution date on which the
optional clean-up call is exercisable) and (ii) the Tax WAC Cap.
(9) The Class M2 Interest will bear interest during each Interest Accrual
Period at a per annum rate equal to lesser of (i) one-month LIBOR
plus 0.280% (0.420% after the first distribution date on which the
optional clean-up call is exercisable) and (ii) the Tax WAC Cap.
(10) The Class M3 Interest will bear interest during each Interest Accrual
Period at a per annum rate equal to lesser of (i) one-month LIBOR
plus 0.300% (0.450% after the first distribution date on which the
optional clean-up call is exercisable) and (ii) the Tax WAC Cap.
(11) The Class M4 Interest will bear interest during each Interest Accrual
Period at a per annum rate equal to lesser of (i) one-month LIBOR
plus 0.360% (0.540% after the first distribution date on which the
optional clean-up call is exercisable) and (ii) the Tax WAC Cap.
(12) The Class M5 Interest will bear interest during each Interest Accrual
Period at a per annum rate equal to lesser of (i) one-month LIBOR
plus 0.400% (0.600% after the first distribution date on which the
optional clean-up call is exercisable) and (ii) the Tax WAC Cap.
(13) The Class M6 Interest will bear interest during each Interest Accrual
Period at a per annum rate equal to lesser of (i) one-month LIBOR
plus 0.450% (0.675% after the first distribution date on which the
optional clean-up call is exercisable) and (ii) the Tax WAC Cap.
(14) The Class B1 Interest will bear interest during each Interest Accrual
Period at a per annum rate equal to lesser of (i) one-month LIBOR
plus 0.800% (1.200% after the first distribution date on which the
optional clean-up call is exercisable) and (ii) the Tax WAC Cap.
(15) The Class B2 Interest will bear interest during each Interest Accrual
Period at a per annum rate equal to lesser of (i) one-month LIBOR
plus 1.000% (1.500% after the first distribution date on which the
optional clean-up call is exercisable) and (ii) the Tax WAC Cap.
(16) The Class B3 Interest will bear interest during each Interest Accrual
Period at a per annum rate equal to lesser of (i) one-month LIBOR
plus 2.000% (3.000% after the first
11
distribution date on which the optional clean-up call is exercisable)
and (ii) the Tax WAC Cap.
(17) The Class X Interest will have a principal balance to the extent of
any Overcollateralized Amount. The Class X Interest will not accrue
interest on such balance but will accrue interest on a notional
principal balance. As of any Distribution Date, the Class X Interest
shall have a notional principal balance equal to the aggregate of the
principal balances of the Middle-Tier Regular Interests as of the
first day of the related Interest Accrual Period. With respect to any
Interest Accrual Period, the Class X Interest shall bear interest at
a rate equal to the excess, if any, of the Tax WAC Cap over the
product of (i) 2 and (ii) the weighted average Middle-Tier Interest
Rate of the Middle-Tier Regular Interests, where the Middle-Tier
Interest Rates on the Class MT-Accrual Interest is subject to a cap
equal to zero and each MT-Accretion Directed Class is subject to a
cap equal to the Pass-Through Rate on its Corresponding Class. With
respect to any Distribution Date, interest that so accrues on the
notional principal balance of the Class X Interest shall be deferred
in an amount equal to any increase in the Overcollateralized Amount
on such Distribution Date. Such deferred interest shall not itself
bear interest. The Class X Certificates will represent beneficial
ownership of a regular interest issued by the Class X REMIC, the
Interest Rate Swap Agreement, the Supplemental Interest Trust and
amounts in the Excess Reserve Fund Account and the Supplemental
Interest Trust, subject to the obligation to make payments from the
Excess Reserve Fund Account in respect of Tax Basis Risk Carry
Forward Amounts. For federal income tax purposes, the Securities
Administrator will treat the Class X Certificateholders' obligation
to make payments from the Excess Reserve Fund Account and the
Supplemental Interest Trust as payments made pursuant to an interest
rate cap contract written by the Class X Certificateholders in favor
of each Class of LIBOR Certificates. Such rights of the Class X
Certificateholders and Principal Certificateholders shall be treated
as held in a portion of the Trust Fund that is treated as a grantor
trust under subpart E, Part I of subchapter J of the Code.
(18) Each of the Certificates will bear interest at a pass through rate
equal to the pass through rate in respect of its Corresponding
Upper-Tier REMIC Class substituting the term "WAC Cap", "Loan Group I
Cap" and "Loan Group II Cap", as applicable, for each reference to
"Tax WAC Cap", "Tax Loan Group I Cap" and "Tax Loan Group II Cap", as
applicable. The "REMIC Cap", as used herein, will equal: (i) the
lesser of the Tax Loan Group I Cap and the Tax WAC Cap in the case of
the Class 1A Certificates; (ii) the lesser of the Tax Loan Group II
Cap and the Tax WAC Cap in the case of the Class 2A Certificates; and
(iii) the Tax WAC Cap in the clase of the Class M and Class B
Certificates. Each of these Certificates will represent not only the
ownership of the Corresponding Class of Upper-Tier Regular Interest
but also the right to receive payments from the Excess Reserve Fund
Account and the Supplemental Interest Trust in respect of any Basis
Risk Carry Forward Amounts, excluding for this purpose, any amount
attributable to the excess of the REMIC Cap over the Pass-Through
Rate of the related Class of Certificates ("Tax Basis Risk Carry
Forward Amounts"). For federal income tax purposes, the Securities
Administrator will treat a Certificateholder's right to receive
payments from the Excess Reserve Fund Account and the Supplemental
Interest Trust as payments made pursuant to an interest rate cap
contract written by the Class X Certificateholders.
12
(19) For each Distribution Date, 100% of the cash flow in respect of the
Class MT-Swap IO Interest. The Class X Certificates will be entitled
to 100% of the cash flow in respect of the Class UT-Swap IO Interest.
Each of these Certificates will also be subject to the obligation to
pay Class IO Shortfalls as described in Section 8.14. For federal income tax
purposes, any amount distributed on the Upper Tier REMIC Interests on any such
Distribution Date in excess of their Pass Through Rate, (the "REMIC Cap")
shall be treated as having been paid from the Excess Reserve Fund Account or
the Supplemental Interest Trust, as applicable, and any excess of the REMIC
Cap over the amount distributable on such Class of Upper Tier REMIC Interests
on such Distribution Date shall be treated as having been paid to the
Supplemental Interest Trust, all pursuant to, and as further provided in,
Section 8.14. The Securities Administrator will treat a LIBOR
Certificateholder's right to receive payments from the Excess Reserve Fund
Account and the Supplemental Interest Trust as payments made pursuant to an
interest rate cap contract written by the Class X Certificateholders.
In addition to issuing the Upper-Tier Regular Interests, the
Upper-Tier REMIC shall issue the Class R Certificates, which shall be the sole
class of residual interests in the Upper-Tier REMIC. The Class R Certificates
will be issued as a single certificate in definitive form in a principal
amount of $100 and shall have no interest rate. Amounts received by the Class
R Certificates shall be deemed paid from the Upper-Tier REMIC.
Class X REMIC
-------------
The Class X REMIC shall issue the following classes of interests. The
Class X Certificates shall represent a regular interest in the Class X REMIC
and the Class RX Certificates shall represent the sole class of residual
interest in the Class X REMIC.
Class X REMIC
------------- Class X REMIC
Designation Interest Rate Principal Amount
----------- ------------- ----------------
Class X Certificates (1) (1)
-----------------
(1) The Class X Certificates are entitled to 100% of the interest and
principal on the Class X Interest and the Class UT-Swap-IO
Interest on each Distribution Date.
In addition to issuing the Class X Certificates, the Class X REMIC
shall issue the Class RX Certificates which shall be the sole class of
residual interests in the Class X REMIC. The Class RX Certificates will be
issued as a single certificate in definitive form in a principal amount of
$100 and shall have no interest rate. Amounts received by the Class RX
Certificates shall be deemed paid from the Class X REMIC.
The foregoing REMIC structure is intended to cause all of the cash
from the Mortgage Loans to flow through to the Upper-Tier REMIC as cash flow
on a REMIC regular interest, without creating any actual or potential
shortfall (other than for credit losses) to any Trust REMIC regular interest.
It is not intended that the Class R, Class RC or Class RX Certificates be
entitled to any cash flow pursuant to this Agreement except as provided in
Section 4.01(a)(ii)(A)(9) hereunder.
13
For any purpose for which the Pass-Through Rates are calculated, the
interest rate on the Mortgage Loans shall be appropriately adjusted to account
for the difference between the monthly day count convention of the Mortgage
Loans and the monthly day count convention of the regular interests issued by
each of the REMICs. For purposes of calculating the Pass-Through Rates for
each of the interests issued by the Lower-Tier REMIC and the Middle-Tier REMIC
such rates shall be adjusted to equal a monthly day count convention based on
a 30 day month for each Due Period and a 360-day year so that the Mortgage
Loans and all regular interests will be using the same monthly day count
convention.
The minimum denomination for each Class of the Offered Certificates
will be $50,000 initial Certificate Balance, with integral multiples of $1 in
excess thereof except that one Certificate in each Class may be issued in a
different amount. The minimum denomination for (a) the Class R and Class RC
Certificates will each be $100 and each will be a 100% Percentage Interest in
such Class, (b) the Class RX Certificates will be a 100% Percentage Interest
in such Class and (c) the Class P and Class X Certificates will be a 1%
Percentage Interest in each such Class.
Set forth below are designations of Classes of Certificates to the
categories used herein:
Book-Entry Certificates.............. All Classes of Certificates other than
the Physical Certificates.
Class A Certificates................. The Class 1A1, Class 1A2, Class 2A1A,
Class, 2A1B, Class A4A (comprised of
the 1A3A and 2A2A components) and
Class A4B (comprised of the 1A3B and
2A2B components) Certificates,
collectively.
Class 1A Certificates................ The Class 1A1, Class 1A2, Class A4A
(to the extent of the 1A3A component)
and Class A4B (to the extent of the
1A3B component) Certificates,
collectively.
Class 2A Certificates................ The Class 2A1A, Class 2A1B, Class A4A
(to the extent of the 2A2A component)
and Class A4B (to the extent of the
2A2B component) Certificates,
collectively.
Class B Certificates................. The Class B1, Class B2 and Class B3
Certificates, collectively.
Class M Certificates................. The Class M1, Class M2, Class M3,
Class M4, Class M5 and Class M6
Certificates, collectively.
Component Classes.................... The Class A4A (comprised of the 1A3A
and 2A2A components) and Class A4B
(comprised of the 1A3B and 2A2B
components) Certificates,
14
collectively.
Components........................... The 1A3A, 1A3B, 2A2A and 2A2B
components, collectively.
Residual Certificates................ The Class R, Class RC and Class RX
Certificates.
ERISA Restricted The Private Certificates and any
Certificates......................... Certificate with a rating below the
lowest applicable permitted rating
under the Underwriters' Exemption.
LIBOR Certificates................... The Offered Certificates, other than
the Residual Certificates, and the
Class B3 Certificates.
Offered Certificates................. All Classes of Certificates other than
the Private Certificates.
Private Certificates................. The Class B3, Class P and Class X
Certificates.
Physical Certificates................ The Class R, Class RC and Class RX
Certificates.
Principal Certificates............... The Offered Certificates and the Class
B3 Certificates.
Rating Agencies...................... ▇▇▇▇▇'▇ and S&P.
Regular Certificates................. All Classes of Certificates other than
the Residual Certificates.
Subordinated Certificates............ The Class M and Class B Certificates.
ARTICLE I
DEFINITIONS
Section 1.01 Definitions. Capitalized terms used herein but not
defined herein shall have the meanings given them in the applicable Servicing
Agreement or Sale Agreement. Whenever used in this Agreement, the following
words and phrases, unless the context otherwise requires, shall have the
following meanings:
10-K Filing Deadline: As defined in Section 13.04.
40-Year Trigger Event: With respect to the 241st Distribution Date or
any Distribution Date thereafter, the circumstances in which (i) the aggregate
scheduled principal balance of the Mortgage Loans with original amortization
terms of 40 years and maturing in 40 years, exceeds (ii) the
Overcollateralized Amount for such Distribution Date.
15
60+ Day Delinquent Mortgage Loan: Each Mortgage Loan with respect to
which any portion of a Monthly Payment is, as of the last day of the prior Due
Period, two (2) months or more past due (without giving effect to any grace
period), each Mortgage Loan in foreclosure, all REO Property and each Mortgage
Loan for which the Mortgagor has filed for bankruptcy.
Account: Any of the Distribution Account or the Excess Reserve Fund
Account. Each such Account shall be a separate Eligible Account.
Accrued Certificate Interest: With respect to any Distribution Date
for each Class of LIBOR Certificates, the amount of interest accrued during
the related Interest Accrual Period at the applicable Pass-Through Rate on the
related Class Certificate Balance, or, in the case of the Component Classes,
on each related Component principal balance, immediately prior to such
Distribution Date, as reduced by such Class's or Component's share of Net
Prepayment Interest Shortfalls and Relief Act Interest Shortfalls for the
related Due Period allocated to such Class pursuant to Section 4.01.
Additional Form 10-D Disclosure: As defined in Section 13.03.
Additional Form 10-K Disclosure: As defined in Section 13.04.
Additional Servicer: Each affiliate of each Servicer that services
any of the Mortgage Loans and each Person who is not an affiliate of the any
Servicer, who services 10% or more of the Mortgage Loans. For clarification
purposes, the Master Servicer and the Securities Administrator are Additional
Servicers.
Adjusted Net Mortgage Interest Rate: As to each Mortgage Loan and at
any time, the per annum rate equal to the Mortgage Interest Rate less the
Expense Fee Rate.
Administrative Fee Rate: With respect to any Mortgage Loan, the
Master Servicing Fee Rate.
Administrative Fees: As to each Mortgage Loan, the fees calculated by
reference to the Administrative Fee Rate.
Advance: Any Monthly Advance or Servicing Advance.
Affiliate: With respect to any Person, any other Person controlling,
controlled by or under common control with such first Person. For the purposes
of this definition, "control" means the power to direct the management and
policies of such Person, directly or indirectly, whether through the ownership
of voting securities, by contract or otherwise; and the terms "controlling"
and "controlled" have meanings correlative to the foregoing.
Agreement: This Master Servicing and Trust Agreement and all
amendments or supplements hereto.
Applied Realized Loss Amount: With respect to any Distribution Date,
the amount, if any, by which the aggregate Class Certificate Balance of the
LIBOR Certificates after
16
distributions of principal on such Distribution Date exceeds the aggregate
Stated Principal Balance of the Mortgage Loans for such Distribution Date.
Assignment of Mortgage: An assignment of the Mortgage, notice of
transfer or equivalent instrument in recordable form (other than the
assignee's name and recording information not yet returned from the recording
office), reflecting the sale of the Mortgage to the Trustee.
Assignment Agreement: A Step 1 Assignment Agreement or a Step 2
Assignment Agreement.
Auction Call: As defined in Section 9.03(b).
Available Funds: With respect to any Distribution Date and the
Mortgage Loans to the extent received by the Master Servicer (x) the sum of
(without duplication): (i) all scheduled installments of interest (net of the
related Expense Fees) and principal due on the Due Date on such Mortgage Loans
in the related Due Period and received on or prior to the related
Determination Date, together with any Monthly Advances in respect thereof;
(ii) all Condemnation Proceeds, Insurance Proceeds and Liquidation Proceeds
received during the related Principal Prepayment Period (in each case, net of
unreimbursed expenses incurred in connection with a liquidation or foreclosure
and unreimbursed Advances, if any); (iii) all partial or full prepayments
(excluding Prepayment Premiums) on the Mortgage Loans received during the
related Principal Prepayment Period together with all Compensating Interest
paid in connection therewith; (iv) all amounts received with respect to such
Distribution Date in connection with a purchase or repurchase of a Deleted
Mortgage Loan; (v) all amounts received with respect to such Distribution Date
as a Substitution Adjustment Amount received in connection with the
substitution of a Mortgage Loan; (vi) all Net Swap Receipt Amounts, if any,
less Net Swap Payment Amounts, if any, for such Distribution Date; and (vii)
all proceeds received with respect to the termination of the Trust Fund
pursuant to clause (a) of Section 11.01; reduced by (y) all amounts in
reimbursement for Monthly Advances and Servicing Advances previously made with
respect to the Mortgage Loans, and other amounts as to which the Servicers,
the Depositor, the Master Servicer, the Securities Administrator, the Trustee
(or co-trustee) or the Custodians are entitled to be paid or reimbursed
pursuant to this Agreement.
Avelo: Avelo Mortgage, L.L.C., a Delaware limited liability company,
and its successors in interest.
Avelo Call: As defined in Section 11.01.
Avelo Servicing Agreement: The Flow Servicing Agreement, dated as of
January 1, 2006, between Avelo and GSMC, as modified by the related Assignment
Agreements.
Back-Up Certification: As defined in Section 13.06.
Basic Principal Distribution Amount: With respect to any Distribution
Date, the excess of (i) the aggregate Principal Remittance Amount for such
Distribution Date over (ii) the Excess Overcollateralized Amount, if any, for
such Distribution Date.
▇▇
▇▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇: With respect to each Class of LIBOR
Certificates, as of any Distribution Date, the sum of (A) if on such
Distribution Date the Pass-Through Rate for any Class of LIBOR Certificates is
based upon the Loan Group Cap or the WAC Cap, the excess, if any, of (i) the
amount of interest such Class of Certificates would otherwise be entitled to
receive on such Distribution Date had such Pass-Through Rate not been subject
to the Loan Group Cap or the WAC Cap, over (ii) the amount of interest that
Class of Certificates received on such Distribution Date taking into account
the Loan Group Cap and the WAC Cap and (B) the Basis Risk Carry Forward Amount
for such Class of Certificates for all previous Distribution Dates not
previously paid, together with interest thereon at a rate equal to the
applicable Pass-Through Rate for such Class of Certificates for such
Distribution Date, without giving effect to the Loan Group Cap or the WAC Cap.
Basis Risk Payment: For any Distribution Date, an amount equal to the
lesser of (i) the aggregate of the Basis Risk Carry Forward Amounts for such
Distribution Date, (ii) the Class X Distributable Amount (prior to any
reduction for Basis Risk Payments) or (iii) the amount payable from the
Supplemental Interest Trust.
BNY: The Bank of New York Trust Company, National Association, a
national banking association, and its successors in interest.
Book-Entry Certificates: As specified in the Preliminary Statement.
Business Day: Any day other than (i) Saturday or Sunday, or (ii) a
day on which banking and savings and loan institutions, in (a) the States of
New York, California, Texas, Maryland and Minnesota, (b) with respect to a
Servicer, the State in which such Servicer's servicing operations are located,
or (c) the State in which the Trustee's operations are located, are authorized
or obligated by law or executive order to be closed.
Certificate: Any one of the Certificates executed by the Securities
Administrator in substantially the forms attached hereto as exhibits.
Certificate Balance: With respect to any Class of LIBOR Certificates,
at any date, the maximum dollar amount of principal to which the Holder
thereof is then entitled hereunder, such amount being equal to the
Denomination thereof minus all distributions of principal previously made with
respect thereto and in the case of any Subordinated Certificates, reduced by
any Applied Realized Loss Amounts applicable to such Class of Subordinated
Certificates; provided, however, that immediately following the Distribution
Date on which a Subsequent Recovery is distributed, the Class Certificate
Balances of any Class or Classes of Certificates that have been previously
reduced by Applied Realized Loss Amounts will be increased, in order of
seniority, by the amount of the Subsequent Recovery distributed on such
Distribution Date (up to the amount of Applied Realized Loss Amounts allocated
to such Class or Classes). The Class X Certificates have no Certificate
Balance and the Class P Certificates have a $100 notional certificate balance.
Certificate Owner: With respect to a Book-Entry Certificate, the
Person who is the beneficial owner of such Book-Entry Certificate.
Certificate Register: The register maintained pursuant to Section
5.02.
18
Certificateholder or Holder: The person in whose name a Certificate
is registered in the Certificate Register, except that, solely for the purpose
of giving any consent pursuant to this Agreement, any Certificate registered
in the name of the Depositor or any affiliate of the Depositor shall be deemed
not to be Outstanding and the Percentage Interest evidenced thereby shall not
be taken into account in determining whether the requisite amount of
Percentage Interests necessary to effect such consent has been obtained;
provided, however, that if any such Person (including the Depositor) owns 100%
of the Percentage Interests evidenced by a Class of Certificates, such
Certificates shall be deemed to be Outstanding for purposes of any provision
hereof that requires the consent of the Holders of Certificates of a
particular Class as a condition to the taking of any action hereunder. The
Securities Administrator is entitled to rely conclusively on a certification
of the Depositor or any affiliate of the Depositor in determining which
Certificates are registered in the name of an affiliate of the Depositor.
Certification Parties: As defined in Section 13.06.
Certifying Person: As defined in Section 13.06.
Class: All Certificates bearing the same class designation as set
forth in this Agreement.
Class 1A1 Certificates: All Certificates bearing the class
designation of "Class 1A1."
Class 1A2 Certificates: All Certificates bearing the class
designation of "Class 1A2."
Class 2A1A Certificates: All Certificates bearing the class
designation of "Class 2A1A."
Class 2A1B Certificates: All Certificates bearing the class
designation of "Class 2A1B."
Class A4A Certificates: All Certificates bearing the class
designation of "Class A4A."
Class A4B Certificates: All Certificates bearing the class
designation of "Class A4B."
Class A Certificates: As specified in the Preliminary Statement.
Class A Principal Allocation Percentage: For any Distribution Date,
the percentage equivalent of a fraction, determined as follows: (A) with
respect to the Class 1A Certificates, a fraction, the numerator of which is
the portion of the Principal Remittance Amount for such Distribution Date that
is attributable to the principal received or advanced on the Group I Mortgage
Loans and the denominator of which is the Principal Remittance Amount for such
Distribution Date and (B) with respect to the Class 2A Certificates, a
fraction, the numerator of which is the portion of the Principal Remittance
Amount for such Distribution Date
19
that is attributable to the principal received or advanced on the Group II
Mortgage Loans and the denominator of which is the Principal Remittance Amount
for such Distribution Date.
Class A Principal Distribution Amount: With respect to any
Distribution Date, the excess of (i) the aggregate Class Certificate Balance
of the Class A Certificates immediately prior to such Distribution Date over
(ii) the lesser of (A) 86.40% of the aggregate Stated Principal Balance of the
Mortgage Loans for such Distribution Date and (B) the excess, if any, of the
aggregate Stated Principal Balance of the Mortgage Loans for such Distribution
Date over the Overcollateralization Floor.
Class A4A Certificates: All Certificates bearing the class
designation of "Class A4A."
Class A4B Certificates: All Certificates bearing the class
designation of "Class A4B."
Class B Certificates: As specified in the Preliminary Statement.
Class B1 Certificates: All Certificates bearing the class designation
of "Class B1."
Class B1 Principal Distribution Amount: With respect to any
Distribution Date, the excess of (i) the sum of (A) the aggregate Class
Certificate Balance of the Class A Certificates (after taking into account the
distribution of the Class A Principal Distribution Amount on such Distribution
Date), (B) the Class Certificate Balance of the Class M1 Certificates (after
taking into account the distribution of the Class M1 Principal Distribution
Amount on such Distribution Date), (C) the Class Certificate Balance of the
Class M2 Certificates (after taking into account the distribution of the Class
M2 Principal Distribution Amount on such Distribution Date), (D) the Class
Certificate Balance of the Class M3 Certificates (after taking into account
the distribution of the Class M3 Principal Distribution Amount on such
Distribution Date), (E) the Class Certificate Balance of the Class M4
Certificates (after taking into account the distribution of the Class M4
Principal Distribution Amount on such Distribution Date), (F) the Class
Certificate Balance of the Class M5 Certificates (after taking into account
the distribution of the Class M5 Principal Distribution Amount on such
Distribution Date), (G) the Class Certificate Balance of the Class M6
Certificates (after taking into account the distribution of the Class M6
Principal Distribution Amount on such Distribution Date) and (H) the Class
Certificate Balance of the Class B1 Certificates immediately prior to such
Distribution Date over (ii) the lesser of (A) the product of (x) 97.00% and
(y) the aggregate Stated Principal Balance of the Mortgage Loans for such
Distribution Date, and (B) the excess, if any, of the aggregate Stated
Principal Balance of the Mortgage Loans for such Distribution Date over the
Overcollateralization Floor.
Class B2 Certificates: All Certificates bearing the class designation
of "Class B2."
Class B2 Principal Distribution Amount: With respect to any
Distribution Date, the excess of (i) the sum of (A) the aggregate Class
Certificate Balance of the Class A Certificates (after taking into account the
distribution of the Class A Principal Distribution
20
Amount on such Distribution Date), (B) the Class Certificate Balance of the
Class M1 Certificates (after taking into account the distribution of the Class
M1 Principal Distribution Amount on such Distribution Date), (C) the Class
Certificate Balance of the Class M2 Certificates (after taking into account
the distribution of the Class M2 Principal Distribution Amount on such
Distribution Date), (D) the Class Certificate Balance of the Class M3
Certificates (after taking into account the distribution of the Class M3
Principal Distribution Amount on such Distribution Date), (E) the Class
Certificate Balance of the Class M4 Certificates (after taking into account
the distribution of the Class M4 Principal Distribution Amount on such
Distribution Date), (F) the Class Certificate Balance of the Class M5
Certificates (after taking into account the distribution of the Class M5
Principal Distribution Amount on such Distribution Date), (G) the Class
Certificate Balance of the Class M6 Certificates (after taking into account
the distribution of the Class M6 Principal Distribution Amount on such
Distribution Date), (H) the Class Certificate Balance of the Class B1
Certificates (after taking into account the distribution of the Class B1
Principal Distribution Amount on such Distribution Date) and (I) the Class
Certificate Balance of the Class B2 Certificates immediately prior to that
Distribution Date over (ii) the lesser of (A) the product of (x) 98.00% and
(y) the aggregate Stated Principal Balance of the Mortgage Loans for such
Distribution Date and (B) the excess, if any, of the aggregate Stated
Principal Balance of the Mortgage Loans for such Distribution Date over the
Overcollateralization Floor.
Class B3 Certificates: All Certificates bearing the class designation
of "Class B3."
Class B3 Principal Distribution Amount: With respect to any
Distribution Date, the excess of (i) the sum of (A) the aggregate Class
Certificate Balance of the Class A Certificate (after taking into account the
distribution of the Class A Principal Distribution Amount on such Distribution
Date), (B) the lass Certificate Balance of the Class M1 Certificate Amount on
such Distribution Date), (C) the Class Certificate Balance of the Class M2
Certificate (after taking into account the distribution of the Class M2
Principal Distribution Amount on such Distribution Date), (D) the Class
Certificate Balance of the Class M3 Certificates (after taking into account
the distribution of the Class M3 Principal Distribution Amount on such
Distribution Date), (E) the Class Certificate Balance of the Class M4
Certificate (after taking into account the distribution of the Class M4
Principal Distribution Amount on such Distribution Date), (F) the Class
Certificate Balance of the Class M5 Certificates (after taking into account
the distribution of the Class B5 Principal Distribution Amount on such
Distribution Date, (G) the Class Certificate Balance of the Class M6
Certificate (after taking into account the distribution of the Class M6
Principal Distribution Amount on such Distribution Date), (H) the Class
Certificate Balance of the Class B1 Certificates (after taking into account
the distribution of the Class B1 Principal Distribution Amount on such
Distribution Date), (I) the Class Certificate Balance of the Class B2
Certificate (after taking into account the distribution of the Class B12
Principal Distribution Amount on such Distribution Date) and (J) the Class
Certificate Balance of the Class B3 Certificates immediately prior to that
Distribution Date over (ii) the lesser of (A) the product of 99.00% and (y)
the aggregate Stated Principal Balance of the Mortgage Loans for such
Distribution Date and (B) the excess, if any, of the aggregate Stated
Principal Balance of the Mortgage Loans for such Distribution Date over the
Overcollateralization Floor.
21
Class Certificate Balance: With respect to any Class and as to any
date of determination, the aggregate of the Certificate Balances of all
Certificates of such Class as of such date.
Class IO Shortfall: As defined in Section 8.14. For the avoidance of
doubt, the Class IO Shortfall for any Distribution Date shall equal the amount
payable to the Class X Certificates in respect of amounts due to the Swap
Provider on such Distribution Date (other than Defaulted Swap Termination
Payments) in excess of the amount payable on the Class X Interest on such
Distribution Date, all as further provided in Section 8.14.
Class M Certificates: As specified in the Preliminary Statement.
Class M1 Certificates: All Certificates bearing the class designation
of "Class M1."
Class M1 Principal Distribution Amount: With respect to any
Distribution Date, the excess of (i) the sum of (A) the aggregate Class
Certificate Balance of the Class A Certificates (after taking into account the
distribution of the Class A Principal Distribution Amount on such Distribution
Date), and (B) the Class Certificate Balance of the Class M1 Certificates
immediately prior to such Distribution Date over (ii) the lesser of (A) the
product of (x) 89.00% and (y) the aggregate Stated Principal Balance of the
Mortgage Loans for such Distribution Date and (B) the excess, if any, of the
aggregate Stated Principal Balance of the Mortgage Loans for such Distribution
Date over the Overcollateralization Floor.
Class M2 Certificates: All Certificates bearing the class designation
of "Class M2."
Class M2 Principal Distribution Amount: With respect to any
Distribution Date, the excess of (i) the sum of (A) the aggregate Class
Certificate Balance of the Class A Certificates (after taking into account the
distribution of the Class A Principal Distribution Amount on such Distribution
Date), (B) the Class Certificate Balance of the Class M1 Certificates (after
taking into account the distribution of the Class M1 Principal Distribution
Amount on such Distribution Date) and (C) the Class Certificate Balance of the
Class M2 Certificates immediately prior to such Distribution Date over (ii)
the lesser of (A) the product of (x) 91.40% and (y) the aggregate Stated
Principal Balance of the Mortgage Loans for such Distribution Date and (B) the
excess, if any, of the aggregate Stated Principal Balance of the Mortgage
Loans for such Distribution Date over the Overcollateralization Floor.
Class M3 Certificates: All Certificates bearing the class designation
of "Class M3."
Class M3 Principal Distribution Amount: With respect to any
Distribution Date, the excess of (i) the sum of (A) the aggregate Class
Certificate Balance of the Class A Certificates (after taking into account the
distribution of the Class A Principal Distribution Amount on such Distribution
Date), (B) the Class Certificate Balance of the Class M1 Certificates (after
taking into account the distribution of the Class M1 Principal Distribution
Amount on such Distribution Date), (C) the Class Certificate Balance of the
Class M2 Certificates (after taking into account the distribution of the Class
M2 Principal Distribution
22
Amount on such Distribution Date) and (D) the Class Certificate Balance of the
Class M3 Certificates immediately prior to such Distribution Date over (ii)
the lesser of (A) the product of (x) 92.90% and (y) the aggregate Stated
Principal Balance of the Mortgage Loans for such Distribution Date and (B) the
excess, if any, of the aggregate Stated Principal Balance of the Mortgage
Loans for such Distribution Date over the Overcollateralization Floor.
Class M4 Certificates: All Certificates bearing the class designation
of "Class M4."
Class M4 Principal Distribution Amount: With respect to any
Distribution Date, the excess of (i) the sum of (A) the aggregate Class
Certificate Balance of the Class A Certificates (after taking into account the
distribution of the Class A Principal Distribution Amount on such Distribution
Date), (B) the Class Certificate Balance of the Class M1 Certificates (after
taking into account the distribution of the Class M1 Principal Distribution
Amount on such Distribution Date), (C) the Class Certificate Balance of the
Class M2 Certificates (after taking into account the distribution of the Class
M2 Principal Distribution Amount on such Distribution Date), (D) the Class
Certificate Balance of the Class M3 Certificates (after taking into account
the distribution of the Class M3 Principal Distribution Amount on such
Distribution Date) and (E) the Class Certificate Balance of the Class M4
Certificates immediately prior to such Distribution Date over (ii) the lesser
of (A) the product of (x) 94.00% and (y) the aggregate Stated Principal
Balance of the Mortgage Loans for such Distribution Date and (B) the excess,
if any, of the aggregate Stated Principal Balance of the Mortgage Loans for
such Distribution Date over the Overcollateralization Floor.
Class M5 Certificates: All Certificates bearing the class designation
of "Class M5."
Class M5 Principal Distribution Amount: With respect to any
Distribution Date, the excess of (i) the sum of (A) the aggregate Class
Certificate Balance of the Class A Certificates (after taking into account the
distribution of the Class A Principal Distribution Amount on such Distribution
Date), (B) the Class Certificate Balance of the Class M1 Certificates (after
taking into account the distribution of the Class M1 Principal Distribution
Amount on such Distribution Date), (C) the Class Certificate Balance of the
Class M2 Certificates (after taking into account the distribution of the Class
M2 Principal Distribution Amount on such Distribution Date), (D) the Class
Certificate Balance of the Class M3 Certificates (after taking into account
the distribution of the Class M3 Principal Distribution Amount on such
Distribution Date), (E) the Class Certificate Balance of the Class M4
Certificates (after taking into account the distribution of the Class M4
Principal Distribution Amount on such Distribution Date) and (F) the Class
Certificate Balance of the Class M5 Certificates immediately prior to such
Distribution Date over (ii) the lesser of (A) the product of (x) 95.00% and
(y) the aggregate Stated Principal Balance of the Mortgage Loans for such
Distribution Date and (B) the excess, if any, of the aggregate Stated
Principal Balance of the Mortgage Loans for such Distribution Date over the
Overcollateralization Floor.
Class M6 Principal Distribution Amount: With respect to any
Distribution Date, the excess of (i) the sum of (A) the aggregate Class
Certificate Balance of the Class A Certificates (after taking into account the
distribution of the Class A Principal Distribution
23
Amount on such Distribution Date), (B) the Class Certificate Balance of the
Class M1 Certificates (after taking into account the distribution of the Class
M1 Principal Distribution Amount on such Distribution Date), (C) the Class
Certificate Balance of the Class M2 Certificates (after taking into account
the distribution of the Class M2 Principal Distribution Amount on such
Distribution Date), (D) the Class Certificate Balance of the Class M3
Certificates (after taking into account the distribution of the Class M3
Principal Distribution Amount on such Distribution Date), (E) the Class
Certificate Balance of the Class M4 Certificates (after taking into account
the distribution of the Class M4 Principal Distribution Amount on such
Distribution Date), (F) the Class Certificate Balance of the Class M5
Certificates (after taking into account the distribution of the Class M5
Principal Distribution Amount on such Distribution Date) and (G) the Class
Certificate Balance of the Class M6 Certificates immediately prior to such
Distribution Date over (ii) the lesser of (A) the product of (x) 96.00% and
(y) the aggregate Stated Principal Balance of the Mortgage Loans for such
Distribution Date and (B) the excess, if any, of the aggregate Stated
Principal Balance of the Mortgage Loans for such Distribution Date over the
Overcollateralization Floor.
Class P Certificates: All Certificates bearing the class designation
of "Class P."
Class R Certificates: All Certificates bearing the class designation
of "Class R."
Class RC Certificates: All Certificates bearing the class designation
of "Class RC."
Class RX Certificates: All Certificates bearing the class designation
of "Class RX."
Class X Certificates: All Certificates bearing the class designation
of "Class X."
Class X Distributable Amount: On any Distribution Date, (i) as a
distribution in respect of interest, the amount of interest that has accrued
on the Class X Interest and not applied as an Extra Principal Distribution
Amount on such Distribution Date, plus any such accrued interest remaining
undistributed from prior Distribution Dates, plus, without duplication, (ii)
as a distribution in respect of principal, any portion of the principal
balance of the Class X Interest which is distributable as an
Overcollateralization Reduction Amount, minus (iii) any amounts paid as a
Basis Risk Payment.
Class X Interest: The Upper-Tier Regular Interest as specified and
described in the Preliminary Statement and the related footnote thereto.
Class X REMIC: As defined in the Preliminary Statement.
Closing Date: January 30, 2007.
Code: The Internal Revenue Code of 1986, including any successor or
amendatory provisions.
Collection Account: The "Custodial Account" as defined in the
applicable Servicing Agreement.
24
Commission: The U.S. Securities and Exchange Commission.
Compensating Interest: For any Distribution Date and each Servicer,
an amount equal to the lesser of (A) the aggregate of the prepayment interest
shortfalls on the Mortgage Loans for the related Distribution Date resulting
from voluntary principal prepayments on the Mortgage Loans during the related
Prepayment Period and (B) (i) one-half of the applicable Servicing Fee
received for the related Distribution Date in the case of Avelo, Countrywide
Servicing or GreenPoint or (ii) the applicable Servicing Fee received for the
related Distribution Date in the case of Wachovia.
Components: The 1A2A, 1A3B, 2A2A and 2A2B components.
Component Classes: As defined in the Preliminary Statement.
Condemnation Proceeds: All awards or settlements in respect of a
Mortgaged Property, whether permanent or temporary, partial or entire, by
exercise of the power of eminent domain or condemnation, to the extent not
required to be released to a Mortgagor in accordance with the terms of the
related Mortgage Loan Documents.
Corporate Trust Office: With respect to the Securities Administrator,
the principal office of the Securities Administrator is located at ▇▇▇▇ ▇▇▇
▇▇▇▇▇▇▇▇▇ ▇▇▇▇, ▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇ ▇▇▇▇▇ and its office for certificate
transfer services is located at ▇▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇ ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇,
▇▇▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇, Attention: Corporate Trust Services, GSAA Home
Equity Trust 2007-1, or at such other address as the Securities Administrator
may designate from time to time by notice to the Certificateholders. With
respect to the Trustee, the principal office of the Trustee at ▇▇▇ ▇▇▇▇
▇▇▇▇▇▇, ▇▇▇▇ ▇▇▇▇▇, ▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇, Attention: GSAA Home Equity
Trust 2007-1, or at such other address as the Trustee may designate from time
to time by notice to the Certificateholders.
Corresponding Class: The Class of interests in one Trust REMIC
created under this Agreement that corresponds to the Class of interests in the
other Trust REMIC or to a Class of Certificates in the manner set out below:
Lower-Tier Upper-Tier Corresponding
Regular Interest Regular Interest Class of Certificates
--------------------- --------------------- -------------------------
Class LT-1A1 Class 1A1 Class 1A1
Class LT-1A2 Class 1A2 Class 1A2
Class LT-2A1A Class 2A1A Class 2A1A
Class LT-2A2B Class 2A2B Class 2A2B
Class LT-A4A Class A4A Class A4A
Class LT-A4B Class A4B Class A4B
Class LT-M1 Class M1 Class M1
Class LT-M2 Class M2 Class M2
Class LT-M3 Class M3 Class M3
Class LT-M4 Class M4 Class M4
Class LT-M5 Class M5 Class M5
Class LT-M6 Class M6 Class M6
25
Lower-Tier Upper-Tier Corresponding
Regular Interest Regular Interest Class of Certificates
--------------------- --------------------- -------------------------
Class LT-B1 Class B1 Class B1
Class LT-B2 Class B2 Class B2
Class LT B3 Class B3 Class B3
Countrywide: Countrywide Home Loans, Inc., a New York corporation,
and its successors in interest.
Countrywide Mortgage Loans: The Mortgage Loans acquired by the
Purchaser pursuant to the Countrywide Sale Agreement.
Countrywide Sale Agreement: The Master Mortgage Loan Purchase
Agreement, dated as of July 1, 2004, between Countrywide, Countrywide
Servicing and GSMC, as amended by that certain Amendment Reg AB, dated as of
January 1, 2006.
Countrywide Servicing: Countrywide Home Loans Servicing LP, a Texas
limited partnership, and its successors in interest.
Countrywide Servicing Agreement: The Servicing Agreement, dated as of
July 1, 2004, as amended by that certain Amendment Reg AB dated as of January
1, 2006, between Countrywide, Countrywide Servicing and GSMC, as modified by
the related Assignment Agreements.
Custodial File: With respect to each Mortgage Loan, any Mortgage Loan
Document which is delivered to the applicable Custodian or which at any time
comes into the possession of that Custodian.
Custodians: Deutsche Bank, U.S. Bank and BNY.
Cut-off Date: January 1, 2007.
Cut-off Date Pool Principal Balance: The aggregate Stated Principal
Balance of all Mortgage Loans as of the Cut-off Date.
Cut-off Date Principal Balance: As to any Mortgage Loan, the Stated
Principal Balance thereof as of the close of business on the Cut-off Date
(after giving effect to payments of principal due on that date, whether or not
received).
Defaulted Swap Termination Payment: Any Swap Termination Payment
required to be paid by the Supplemental Interest Trust to the Swap Provider
pursuant to the Interest Rate Swap Agreement as a result of an Event of
Default (as defined in the Interest Rate Swap Agreement) with respect to which
the Swap Provider is the defaulting party or a Termination Event (as defined
in the Interest Rate Swap Agreement) (other than Illegality or a Tax Event
that is not a Tax Event Upon Merger (each as defined in the Interest Rate Swap
Agreement)) with respect to which the Swap Provider is the sole Affected Party
(as defined in the Interest Rate
26
Swap Agreement) or with respect to a termination resulting from a Substitution
Event (as defined in the Interest Rate Swap Agreement).
Definitive Certificates: Any Certificate evidenced by a Physical
Certificate and any Certificate issued in lieu of a Book-Entry Certificate
pursuant to Section 5.02(e).
Deleted Mortgage Loan: A Mortgage Loan which is purchased or
repurchased by any Responsible Party, the Purchaser or the Depositor in
accordance with the terms of any Sale Agreement, any Assignment Agreement or
this Agreement, as applicable, or which is, in the case of a substitution by
any Servicer (if permitted under the applicable Servicing Agreement) or by the
Purchaser pursuant to the Assignment Agreements or this Agreement, replaced or
to be replaced with a substitute mortgage loan.
Denomination: With respect to each Certificate, the amount set forth
on the face thereof as the "Initial Certificate Balance of this Certificate"
or the Percentage Interest appearing on the face thereof.
Depositor: GS Mortgage Securities Corp., a Delaware corporation, and
its successors in interest.
Depository: The initial Depository shall be The Depository Trust
Company, the nominee of which is CEDE & Co., as the registered Holder of the
Book-Entry Certificates. The Depository shall at all times be a "clearing
corporation" as defined in Section 8-102(a)(5) of the Uniform Commercial Code
of the State of New York.
Depository Institution: Any depository institution or trust company,
including the Trustee and the Securities Administrator, that (a) is
incorporated under the laws of the United States of America or any State
thereof, (b) is subject to supervision and examination by federal or state
banking authorities and (c) has outstanding unsecured commercial paper or
other short-term unsecured debt obligations that are rated "P-1" by Moody's
and "A-1" by Standard & Poor's.
Depository Participant: A broker, dealer, bank or other financial
institution or other Person for whom from time to time a Depository effects
book-entry transfers and pledges of securities deposited with the Depository.
Determination Date: With respect to each Distribution Date, the close
of business of the last day of the month preceding the month in which such
Remittance Date occurs, or, with respect to the Goldman Conduit Mortgage
Loans, the 15th calendar day (or if such 15th day is not a Business Day, the
Business Day immediately following such 15th day) of the month of the related
Remittance Date.
Deutsche Bank: Deutsche Bank National Trust Company, a national
banking association, and its successors in interest.
Distribution Account: The separate Eligible Account created by the
Securities Administrator pursuant to Section 3.01(b) in the name of the
Securities Administrator as paying agent for the benefit of the Trustee and
the Certificateholders and designated "▇▇▇▇▇ Fargo Bank,
27
National Association, as paying agent, in trust for registered holders of GSAA
Home Equity Trust 2007-1, Asset-Backed Certificates, Series 2007-1." Funds in
the Distribution Account shall be held in trust for the Certificateholders for
the uses and purposes set forth in this Agreement.
Distribution Date: The 25th day of each month or, if such day is not
a Business Day, the immediately succeeding Business Day, commencing in
February 2007.
Document Certification and Exception Report: The report attached to
Exhibit F hereto.
Due Date: The day of the month on which the Monthly Payment is due on
a Mortgage Loan, exclusive of any days of grace.
Due Period: With respect to any Distribution Date, the period
commencing on the second day of the calendar month preceding the month in
which that Distribution Date occurs and ending on the first day of the
calendar month in which that Distribution Date occurs, except, in the case of
the Goldman Conduit Mortgage Loans, the period commencing on the first day of
the month and ending on the last day of the month preceding the month of the
Remittance Date.
▇▇▇▇▇: The Commission's Electronic Data Gathering, Analysis and
Retrieval system.
Eligible Account: Either (i) an account maintained with a federal or
state chartered depository institution or trust company the short-term
unsecured debt obligations of which (or, in the case of a depository
institution or trust company that is a subsidiary of a holding company, the
short-term unsecured debt obligations of such holding company) are rated
"A-1+" by Standard & Poor's, "F1" by Fitch and "P-1" by Moody's (or a
comparable rating if another Rating Agency is specified by the Depositor by
written notice to the Servicer) at the time any amounts are held on deposit
therein, (ii) a trust account or accounts maintained with a federal or state
chartered depository institution or trust company acting in its fiduciary
capacity or (iii) any other account acceptable to each Rating Agency. Eligible
Accounts may bear interest, and may include, if otherwise qualified under this
definition, accounts maintained with the Securities Administrator or the
Trustee.
ERISA: The Employee Retirement Income Security Act of 1974, as
amended.
ERISA-Qualifying Underwriting: A best efforts or firm commitment
underwriting or private placement that meets the requirements of Prohibited
Transaction Exemption ("PTE") 2002-41, 67 Fed. Reg. 54487 (2002) (or any
successor thereto), or any --- substantially similar administrative exemption
granted by the U.S. Department of Labor.
ERISA-Restricted Certificate: As specified in the Preliminary
Statement.
Event of Default: As defined in the applicable Servicing Agreement.
28
Excess Overcollateralized Amount: With respect to any Distribution
Date, the excess, if any, of (a) the Overcollateralized Amount on such
Distribution Date over (b) the Specified Overcollateralized Amount for such
Distribution Date.
Excess Reserve Fund Account: The separate Eligible Account created
and maintained by the Securities Administrator pursuant to Sections 3.01(a) in
the name of the Securities Administrator as paying agent for the benefit of
the Regular Certificateholders and designated "▇▇▇▇▇ Fargo Bank, National
Association, as paying agent, in trust for registered holders of GSAA Home
Equity Trust 2007-1, Asset-Backed Certificates, Series 2007-1." Funds in the
Excess Reserve Fund Account shall be held in trust for the Regular
Certificateholders for the uses and purposes set forth in this Agreement.
Amounts on deposit in the Excess Reserve Fund Account shall not be invested.
Exchange Act: The Securities Exchange Act of 1934, as amended, and
the rules and regulations promulgated thereunder.
Exchange Act Filing Obligation: The obligations of the Master
Servicer under Section 9.04 and Article XIII (except Section 13.07) with
respect to notice and information to be provided to the Depositor.
Exchange Act Reports: Any reports on Form 10-D, Form 8-K and Form
10-K required to be filed by the Depositor with respect to the Trust Fund
under the Exchange Act.
Expense Fee Rate: As to each Mortgage Loan, a per annum rate equal to
the sum of the Servicing Fee Rate, the Administrative Fee Rate and, if set
forth on the Mortgage Loan Schedule, the applicable Primary Mortgage Insurance
Policy premium rate.
Expense Fees: As to each Mortgage Loan, the fees calculated by
reference to the Expense Fee Rate.
Extra Principal Distribution Amount: As of any Distribution Date, the
lesser of (x) the related Total Monthly Excess Spread for that Distribution
Date and (y) the related Overcollateralization Deficiency for such
Distribution Date.
Fair Market Value Excess: As defined in Section 11.01.
▇▇▇▇▇▇ ▇▇▇: The Federal National Mortgage Association, and its
successors in interest.
Final Scheduled Distribution Date: The Final Scheduled Distribution
Date for each Class of Certificates (other than the Residual Certificates) is
the Distribution Date occurring in February 2036. The Final Scheduled
Distribution Date for each Class of Residual Certificates is the Distribution
Date occurring in January 2047.
Fitch: Fitch, Inc.
Form 8-K Disclosure Information: As defined in Section 13.02.
29
▇▇▇▇▇▇▇ Mac: The Federal Home Loan Mortgage Corporation, a corporate
instrumentality of the United States created and existing under Title III of
the Emergency Home Finance Act of 1970, as amended, and its successors in
interest.
Goldman Conduit: ▇▇▇▇▇▇▇ ▇▇▇▇▇ Residential Mortgage Conduit Program.
Goldman Conduit Mortgage Loans: The Mortgage Loans acquired by the
Purchaser pursuant to the applicable Goldman Conduit Sale Agreements.
Goldman Conduit Sale Agreements: The Master Loan Purchase Agreements,
between various mortgage loan sellers and GSMC, dated as of their respective
dates, as modified by the related Assignment Agreements.
GreenPoint: GreenPoint Mortgage Funding, Inc., a New York
corporation, and its successors in interest.
GreenPoint Mortgage Loans: The Mortgage Loans acquired by the
Purchaser pursuant to the GreenPoint Sale Agreement.
GreenPoint Sale Agreement: Amended and Restated Master Mortgage Loan
Purchase Agreement, dated as of November 1, 2005, between GreenPoint and GSMC.
GreenPoint Servicing Agreement: The Amended and Restated Servicing
Agreement, dated as of November 1, 2005, between GreenPoint and GSMC, as
modified by the related Assignment Agreements.
Group I Mortgage Loans: The Mortgage Loans identified on the Mortgage
Loan Schedule as Group I Mortgage Loans.
Group II Mortgage Loans: The Mortgage Loans identified on the
Mortgage Loan Schedule as Group II Mortgage Loans.
Insurance Proceeds: With respect to each Mortgage Loan, proceeds of
insurance policies insuring the Mortgage Loan or the related Mortgaged
Property.
Interest Accrual Period: With respect to any Distribution Date, with
respect to the LIBOR Certificates, the period commencing on the immediately
preceding Distribution Date (or commencing on the Closing Date in the case of
the first Distribution Date) and ending on the day immediately preceding the
current Distribution Date the calendar month immediately preceding the month
in which such Distribution Date occurs. For purposes of computing interest
accruals on each Class of LIBOR Certificates, each Interest Accrual Period has
the actual number of days in such period and each year is assumed to have 360
days.
Interest Rate Swap Agreement: The interest rate swap agreement, dated
as of January 12, 2007, between the GSAA Home Equity Trust 2007-1 and the Swap
Provider and assigned to the Supplemental Interest Trust or any other swap
agreement (including any related schedules) assigned to the Supplemental
Interest Trust.
30
Interest Remittance Amount: With respect to any Distribution Date and
the Mortgage Loans in a Loan Group, that portion of Available Funds
attributable to interest relating to the Mortgage Loans in such Loan Group and
any Net Swap Receipt Amounts attributable to such Loan Group for such
Distribution Date, net of any Net Swap Payments made from such Loan Group with
respect to such Distribution Date.
Investment Account: As defined in Section 3.02(a).
Item 1119 Party: The Depositor, the Master Servicer, the Trustee, any
Servicer, any subservicer, any originator identified in the Prospectus
Supplement and any Swap Provider.
LIBOR: With respect to any Interest Accrual Period for the LIBOR
Certificates, the rate determined by the Securities Administrator on the
related LIBOR Determination Date on the basis of the offered rate for one
month U.S. dollar deposits as such rate appears on Telerate Page 3750 as of
11:00 a.m. (London time) on such date; provided, that if such rate does not
appear on Telerate Page 3750, the rate for such date will be determined on the
basis of the rates at which one-month U.S. dollar deposits are offered by the
Reference Banks at approximately 11:00 a.m. (London time) on such date to
prime banks in the London interbank market. In such event, the Securities
Administrator shall request the principal London office of each of the
Reference Banks to provide a quotation of its rate. If at least two (2) such
quotations are provided, the rate for that date will be the arithmetic mean of
the quotations (rounded upwards if necessary to the nearest whole multiple of
1/16%). If fewer than two (2) quotations are provided as requested, the rate
for that date will be the arithmetic mean of the rates quoted by major banks
in New York City, selected by the Securities Administrator (after consultation
with the Depositor), at approximately 11:00 a.m. (New York City time) on such
date for one-month U.S. dollar deposits of leading European banks. The
establishment of LIBOR by the Securities Administrator and the Securities
Administrator's subsequent calculations based thereon, in the absence of
manifest error, shall be final and binding. Except as otherwise set forth
herein, absent manifest error, the Securities Administrator may conclusively
rely on quotations of LIBOR as such quotations appear on Telerate Screen Page
3750.
LIBOR Certificates: As specified in the Preliminary Statement.
LIBOR Determination Date: With respect to any Interest Accrual Period
for the LIBOR Certificates, the second London Business Day preceding the
commencement of such Interest Accrual Period.
Liquidated Mortgage Loan: With respect to any Distribution Date, a
defaulted Mortgage Loan (including any REO Property) which was liquidated in
the Principal Prepayment Period preceding the month of such Distribution Date
and as to which the applicable Servicer has certified that it has received all
amounts it expects to receive in connection with the liquidation of such
Mortgage Loan including the final disposition of an REO Property.
Liquidation Proceeds: Cash received in connection with the
liquidation of a defaulted Mortgage Loan, whether through the sale or
assignment of such Mortgage Loan, trustee's sale, foreclosure sale or
otherwise, or the sale of the related Mortgaged Property if the
31
Mortgaged Property is acquired in satisfaction of the Mortgage Loan, including
any Subsequent Recoveries.
Loan Group: The Group I Mortgage Loans or the Group II Mortgage
Loans, as applicable.
Loan Group Cap: The Loan Group I WAC Cap or the Loan Group II WAC
Cap, as applicable.
Loan Group I WAC Cap: With respect to the Group I Mortgage Loans as
of any Distribution Date, a per annum rate equal to the product of (i) the sum
of (A) the weighted average of the Adjusted Net Mortgage Interest Rates then
in effect on the beginning of the related Due Period on the Group I Mortgage
Loans, and (B) Net Swap Receipt Amounts, if any, less Net Swap Payments, if
any, divided by Stated Principal Balance of the Mortgage Loans of the
beginning of the related Due Period multiplied by 12 and (ii) 30 divided by
the actual number of days in the related Interest Accrual Period.
Loan Group II WAC Cap: With respect to the Group II Mortgage Loans as
of any Distribution Date, a per annum rate equal to the product of (i) the sum
of (A) the weighted average of the Adjusted Net Mortgage Interest Rates then
in effect on the beginning of the related Due Period on the Group II Mortgage
Loans, and (B) Net Swap Receipt Amounts, if any, less Net Swap Payments, if
any, divided by Stated Principal Balance of the Mortgage Loans of the
beginning of the related Due Period multiplied by 12 and (ii) 30 divided by
the actual number of days in the related Interest Accrual Period.
London Business Day: Any day on which dealings in deposits of United
States dollars are transacted in the London interbank market.
Lower-Tier Principal Amount: As described in the Preliminary
Statement.
Lower-Tier Regular Interest: As described in the Preliminary
Statement.
Lower-Tier REMIC: As described in the Preliminary Statement.
Majority Class X Certificateholder: The Holder or Holders of a
majority of the Percentage Interests in the Class X Certificates.
Master Servicer: ▇▇▇▇▇ Fargo, and if a successor master servicer is
appointed hereunder, such successor.
Master Servicer Event of Default: As defined in Section 9.04.
Master Servicer Float Period: As to any Distribution Date and each
Mortgage Loan, the period commencing on the fourth calendar day immediately
preceding such Distribution Date and ending on such Distribution Date.
Master Servicing Fee: 0.00%
32
MERS: Mortgage Electronic Registration Systems, Inc., a corporation
organized and existing under the laws of the State of Delaware, or any
successor thereto.
MERS Loan: Any Mortgage Loan registered with MERS on the MERS System.
MERS System: The system of recording transfers of mortgages
electronically maintained by MERS.
Monthly Advance: As defined in the applicable Servicing Agreement.
Monthly Payment: The scheduled monthly payment of principal and
interest on a Mortgage Loan.
Monthly Statement: The statement made available to the
Certificateholders pursuant to Section 4.02.
Moody's: ▇▇▇▇▇'▇ Investors Service, Inc. If ▇▇▇▇▇'▇ is designated as
a Rating Agency in the Preliminary Statement, for purposes of Section 12.05(b)
the address for notices to Moody's shall be ▇▇▇▇▇'▇ Investors Service, Inc.,
▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇, Attention: Residential Mortgage
Pass-Through Group, or such other address as Moody's may hereafter furnish to
the Depositor and the Servicer.
Mortgage: The mortgage, deed of trust or other instrument identified
on the Mortgage Loan Schedule as securing a Mortgage Note.
Mortgage File: The items pertaining to a particular Mortgage Loan
contained in either the Servicing File or Custodial File.
Mortgage Interest Rate: The annual rate of interest borne on a
Mortgage Note with respect to each Mortgage Loan.
Mortgage Loan: An individual Mortgage Loan which is the subject of a
Sale Agreement and a Servicing Agreement, each Mortgage Loan originally sold
and subject to any Sale Agreement being identified on the Mortgage Loan
Schedule, which Mortgage Loan includes without limitation the Mortgage File,
the Servicing File, the Monthly Payments, Principal Prepayments, Prepayment
Premiums, Liquidation Proceeds, Condemnation Proceeds, Insurance Proceeds, REO
Disposition proceeds and all other rights, benefits, proceeds and obligations
arising from or in connection with such Mortgage Loan.
Mortgage Loan Documents: The mortgage loan documents pertaining to
each Mortgage Loan.
Mortgage Loan Schedule: A schedule of Mortgage Loans annexed hereto
as Schedule I (which shall be delivered to the Custodians in an electronic
format acceptable to the Custodians), such schedule setting forth the
following information with respect to each Mortgage Loan: (1) Responsible
Party's Mortgage Loan number; (2) the address, city, state and zip code of the
Mortgaged Property; (3) a code indicating whether the Mortgagor is
self-employed; (4) a code indicating whether the Mortgaged Property is
owner-occupied, investment property or a
33
second home; (5) a code indicating whether the Mortgaged Property is a single
family residence, two family residence, three-family residence, four family
residence, condominium, manufactured housing or planned unit development; (6)
the purpose of the Mortgage Loan; (7) the type of Mortgage Loan; (8) the
Mortgage Interest Rate at origination; (9) the current Mortgage Interest Rate;
(10) the name of the applicable Servicer; (11) the applicable Servicing Fee
Rate; (12) the current Monthly Payment; (13) the original term to maturity;
(14) the remaining term to maturity; (15) the principal balance of the
Mortgage Loan as of the Cut-off Date after deduction of payments of principal
due on or before the Cut-off Date whether or not collected; (16) the LTV at
origination and if the Mortgage Loan has a second lien, combined LTV at
origination; (17) the actual principal balance of the Mortgage Loan as of the
Cut-off Date; (18) social security number of the Mortgagor; (19) a code
indicating whether the Mortgage Loan had a second lien at origination; (20) if
the Mortgage Loan has a second lien, combined loan balance as of the Cut-off
Date; (21) a code indicating whether the Mortgaged Property is a leasehold
estate; (22) the due date of the Mortgage Loan; (23) whether the Mortgage Loan
is insured by a Primary Mortgage Insurance Policy and the name of the insurer;
(24) the certificate number of the Primary Mortgage Insurance Policy; (25) the
amount of coverage of the Primary Mortgage Insurance Policy, and if it is a
lender-paid Primary Mortgage Insurance Policy, the premium rate; (26) the type
of appraisal; (27) a code indicating whether the Mortgage Loan is a MERS Loan;
(28) documentation type (including asset and income type); (29) first payment
date; (30) the schedule of the payment delinquencies in the prior 12 months;
(31) FICO score; (32) the Mortgagor's name; (33) the stated maturity date;
(34) the original principal amount of the Mortgage Loan; (35) the name of the
applicable Custodian; and (36) a code indicating whether the Mortgage Loan is
a Group I Mortgage Loan or a Group II Mortgage Loan. With respect to the
Mortgage Loans in the aggregate: (1) the number of Mortgage Loans; (2) the
current aggregate outstanding principal balance of the Mortgage Loans; (3) the
weighted average Mortgage Interest Rate of the Mortgage Loans; and (4) the
weighted average maturity of the Mortgage Loans.
Mortgaged Property: The real property (or leasehold estate, if
applicable) identified on the Mortgage Loan Schedule as securing repayment of
the debt evidenced by a Mortgage Note.
Mortgagor: The obligor on a Mortgage Note.
Net Monthly Excess Cash Flow: For any Distribution Date the amount
remaining for distribution pursuant to subsection 4.01(a)(iii) (before giving
effect to distributions pursuant to such subsection).
Net Prepayment Interest Shortfall: For any Distribution Date, the
amount by which the sum of the Prepayment Interest Shortfalls exceeds the sum
of the Compensating Interest payments made on such Distribution Date.
Net Swap Payment Amount: With respect to any Distribution Date, the
Fixed Amount (as defined in the Interest Rate Swap Agreement) payable by the
Supplemental Interest Trust to the Swap Provider, pursuant to the applicable
clauses of the Priorities of Distribution, on the related Fixed Rate Payer
Payment Date (as defined in the Interest Rate Swap Agreement).
34
Net Swap Receipt Amount: With respect to any Distribution Date, the
Floating Amount (as defined in the Interest Rate Swap Agreement) payable by
the Swap Provider to the Supplemental Interest Trust on the related Floating
Rate Payer Payment Date (as defined in the Interest Rate Swap Agreement).
NIM Issuer: The entity established as the issuer of the NIM
Securities.
NIM Securities: Any debt securities secured or otherwise backed by
some or all of the Class P and Class X Certificates.
NIM Trustee: The trustee for the NIM Securities.
Non-Permitted Transferee: As defined in Section 8.12(e).
Nonrecoverable Monthly Advance: Any Monthly Advance previously made
or proposed to be made in respect of a Mortgage Loan or REO Property that, in
the good faith business judgment of the Servicer (in accordance with the
related Servicing Standard set forth in the related Servicing Agreement), the
Master Servicer or any successor Master Servicer including the Trustee, as
applicable, will not or, in the case of a proposed Monthly Advance, would not
be ultimately recoverable from related late payments, Insurance Proceeds,
Condemnation Proceeds or Liquidation Proceeds on such Mortgage Loan or REO
Property as provided herein.
Nonrecoverable Servicing Advance: Any Servicing Advance previously
made or proposed to be made in respect of a Mortgage Loan or REO Property,
which, in the good faith business judgment of the Servicer (in accordance with
the related Servicing Standard set forth in the related Servicing Agreement),
the Master Servicer or any successor Master Servicer including the Trustee, as
applicable, will not or, in the case of a proposed Servicing Advance, would
not, be ultimately recoverable from related Insurance Proceeds, Condemnation
Proceeds, Liquidation Proceeds or otherwise.
Notice of Final Distribution: The notice to be provided pursuant to
Section 11.02 to the effect that final distribution on any of the Certificates
shall be made only upon presentation and surrender thereof.
Offered Certificates: As specified in the Preliminary Statement.
Officer's Certificate: A certificate signed by the Chairman of the
Board or the Vice Chairman of the Board or the President or a Vice President
or an Assistant Vice President and by the Treasurer or the Secretary or one of
the Assistant Treasurers or Assistant Secretaries of any Servicer or any
Responsible Party, and delivered to the Trustee and the Securities
Administrator, as required by any Servicing Agreement or Sale Agreement or, in
the case of any other Person, signed by an authorized officer of such Person.
Opinion of Counsel: A written opinion of counsel, who may be in house
counsel for the applicable Servicer, reasonably acceptable to the Trustee
and/or the Securities Administrator, as applicable (and/or such other Persons
as may be set forth herein); provided, that any Opinion of Counsel relating to
(a) qualification of any Trust REMIC or (b) compliance
35
with the REMIC Provisions, must be (unless otherwise stated in such Opinion of
Counsel) an opinion of counsel who (i) is in fact independent of the
applicable Servicer or the Master Servicer of the Mortgage Loans, (ii) does
not have any material direct or indirect financial interest in the applicable
Servicer or the Master Servicer of the Mortgage Loans or in an affiliate of
either and (iii) is not connected with the applicable Servicer or the Master
Servicer of the Mortgage Loans as an officer, employee, director or person
performing similar functions.
Optional Termination Date: The Distribution Date on which the
aggregate Stated Principal Balance of the Mortgage Loans, as of the last day
of the related Due Period, is equal to 10.00% or less of the Cut-off Date Pool
Principal Balance.
Outstanding: With respect to the Certificates as of any date of
determination, all Certificates theretofore executed and authenticated under
this Agreement except:
(i) Certificates theretofore canceled by the Securities
Administrator or delivered to the Securities Administrator for
cancellation; and
(ii) Certificates in exchange for which or in lieu of which
other Certificates have been executed and delivered by the Securities
Administrator pursuant to this Agreement.
Outstanding Mortgage Loan: As of any Due Date, a Mortgage Loan with a
Stated Principal Balance greater than zero which was not the subject of a
Principal Prepayment in Full prior to such Due Date and which did not become a
Liquidated Mortgage Loan prior to such Due Date.
Overcollateralized Amount: As of any Distribution Date, the excess,
if any, of (a) the aggregate Stated Principal Balance of the Mortgage Loans
for such Distribution Date over (b) the aggregate of the Class Certificate
Balances of the LIBOR Certificates as of such Distribution Date (after giving
effect to the payment of the Principal Remittance Amount on such Certificates
on such Distribution Date).
Overcollateralization Deficiency: With respect to any Distribution
Date, the excess, if any, of (a) the Specified Overcollateralized Amount
applicable to such Distribution Date over (b) the Overcollateralized Amount
applicable to such Distribution Date.
Overcollateralization Floor: With respect to any Distribution Date,
0.50% of the aggregate Stated Principal Balance of the Mortgage Loans as of
the Cut-off Date.
Overcollateralization Reduction Amount: With respect to any
Distribution Date, an amount equal to the lesser of (a) the Excess
Overcollateralized Amount and (b) the Net Monthly Excess Cash Flow.
Ownership Interest: As to any Residual Certificate, any ownership
interest in such Certificate including any interest in such Certificate as the
Holder thereof and any other interest therein, whether direct or indirect,
legal or beneficial.
36
P&I Advances: Advances made by the servicers or the Master Servicer
(including the Trustee as successor master servicer and any other successor
master servicer) with respect to delinquent payments of interest and principal
on the Mortgage Loans, less the servicing fee or the master servicing fee, as
applicable.
Par Value: an amount equal to the greater of (a) the sum of (1) 100%
of the unpaid principal balance of the Mortgage Loans (other than Mortgage
Loans related to REO Properties), (2) interest accrued and unpaid on the
Mortgage Loans, (3) any ▇▇▇▇▇▇▇▇▇▇▇▇ ▇&▇ Advances, fees and expenses of the
Master Servicer, the Securities Administrator and the Trustee, (4) any
expenses incurred during the exercise of the Auction Call and (5) with respect
to any REO Property, the lesser of (x) the appraised value of each REO
Property, as determined by the higher of two appraisals completed by two
independent appraisers selected by the Master Servicer or its designee, and
(y) the unpaid principal balance of each Mortgage Loan related to any REO
Property, and (b) the sum of (1) the aggregate unpaid Class Certificate
Balance of each Class of Certificates then outstanding, (2) interest accrued
and unpaid on the Certificates, (3) any ▇▇▇▇▇▇▇▇▇▇▇▇ ▇&▇ Advances, fees and
expenses of the Master Servicer, the Securities Administrator and the Trustee
and (4) any Swap Termination Payment other than a Defaulted Swap Termination
Payment owed to the Swap Provider.
Pass-Through Rate: For each Class of Certificates and each Lower-Tier
Regular Interest, the per annum rate set forth or calculated in the manner
described in the Preliminary Statement.
Percentage Interest: As to any Certificate, the percentage interest
evidenced thereby in distributions required to be made on the related Class,
such percentage interest being set forth on the face thereof or equal to the
percentage obtained by dividing the Denomination of such Certificate by the
aggregate of the Denominations of all Certificates of the same Class.
Permitted Investments: Any one or more of the following obligations
or securities acquired at a purchase price of not greater than par, regardless
of whether issued by the Servicer, the Trustee, the Securities Administrator
or any of their respective Affiliates:
(i) direct obligations of, or obligations fully guaranteed
as to timely payment of principal and interest by, the United States
or any agency or instrumentality thereof, provided such obligations
are backed by the full faith and credit of the United States;
(ii) demand and time deposits in, certificates of deposit
of, or bankers' acceptances (which shall each have an original
maturity of not more than ninety (90) days and, in the case of
bankers' acceptances, shall in no event have an original maturity of
more than 365 days or a remaining maturity of more than thirty (30)
days) denominated in United States dollars and issued by any
Depository Institution and rated F1+ by Fitch, P-1 by ▇▇▇▇▇'▇ and
A-1+ by S&P;
(iii) repurchase obligations with respect to any security
described in clause (i) above entered into with a Depository
Institution (acting as principal);
(iv) securities bearing interest or sold at a discount that
are issued by any corporation incorporated under the laws of the
United States of America or any state
37
thereof and that are rated by each Rating Agency that rates such
securities in its highest long-term unsecured rating categories at
the time of such investment or contractual commitment providing
for such investment;
(v) commercial paper (including both non-interest-bearing
discount obligations and interest-bearing obligations payable on
demand or on a specified date not more than thirty (30) days after
the date of acquisition thereof) that is rated by each Rating Agency
that rates such securities in its highest short-term unsecured debt
rating available at the time of such investment;
(vi) units of money market funds, including money market
funds advised by the Depositor, the Securities Administrator or the
Trustee or an Affiliate thereof, that have been rated "Aaa" by
▇▇▇▇▇'▇, "AAAm" or "AAAm-G" by Standard & Poor's and, if rated by
Fitch, at least "AA" by Fitch; and
(vii) if previously confirmed in writing to the Securities
Administrator, any other demand, money market or time deposit, or any
other obligation, security or investment, as may be acceptable to the
Rating Agencies as a permitted investment of funds backing "Aaa" or
"AAA" rated securities;
provided, however, that no instrument described hereunder shall evidence
either the right to receive (a) only interest with respect to the obligations
underlying such instrument or (b) both principal and interest payments derived
from obligations underlying such instrument and the interest and principal
payments with respect to such instrument provide a yield to maturity at par
greater than 120% of the yield to maturity at par of the underlying
obligations.
Permitted Transferee: Any Person other than (i) the United States,
any State or political subdivision thereof, or any agency or instrumentality
of any of the foregoing, (ii) a foreign government, international organization
or any agency or instrumentality of either of the foregoing, (iii) an
organization (except certain farmers' cooperatives described in Section 521 of
the Code) which is exempt from tax imposed by Chapter 1 of the Code (including
the tax imposed by Section 511 of the Code on unrelated business taxable
income) on any excess inclusions (as defined in Section 860E(c)(1) of the
Code) with respect to any Residual Certificate, (iv) rural electric and
telephone cooperatives described in Section 1381(a)(2)(C) of the Code, (v) a
Person that is not a U.S. Person or a U.S. Person with respect to whom income
from a Residual Certificate is attributable to a foreign permanent
establishment or fixed base (within the meaning of an applicable income tax
treaty) of such Person or any other U.S. Person, (vi) an "electing large
partnership" within the meaning of Section 775 of the Code and (vii) any other
Person so designated by the Depositor based upon an Opinion of Counsel that
the Transfer of an Ownership Interest in a Residual Certificate to such Person
may cause any Trust REMIC to fail to qualify as a REMIC at any time that the
Certificates are outstanding. The terms "United States," "State" and
"international organization" shall have the meanings set forth in Section 7701
of the Code or successor provisions. A corporation will not be treated as an
instrumentality of the United States or of any State or political subdivision
thereof for these purposes if all of its activities are subject to tax and,
with the exception of the ▇▇▇▇▇▇▇ Mac, a majority of its board of directors is
not selected by such government unit.
38
Person: Any individual, corporation, partnership, joint venture,
association, limited liability company, joint stock company, trust,
unincorporated organization or government, or any agency or political
subdivision thereof.
Physical Certificates: As specified in the Preliminary Statement.
Pool Stated Principal Balance: As to any Distribution Date, the
aggregate of the Stated Principal Balances of the Mortgage Loans for such
Distribution Date that were Outstanding Mortgage Loans on the Due Date in the
related Due Period.
Prepayment Interest Shortfall: With respect to any Remittance Date,
the sum of, for each Mortgage Loan that was during the related Principal
Prepayment Period the subject of a Principal Prepayment that was applied by
the Servicer to reduce the outstanding principal balance of such Mortgage Loan
on a date preceding the Due Date in the succeeding Principal Prepayment
Period, an amount equal to the product of (a) the Mortgage Interest Rate net
of the applicable Servicing Fee Rate for such Mortgage Loan, (b) the amount of
the Principal Prepayment for such Mortgage Loan, (c) 1/360 and (d) the number
of days commencing on the date on which such Principal Prepayment was applied
and ending on the last day of the related Principal Prepayment Period.
Prepayment Premium: Any prepayment premium, penalty or charge, if
any, required under the terms of the related Mortgage Note to be paid in
connection with a Principal Prepayment, to the extent permitted by law.
Principal Certificates: As specified in the Preliminary Statement.
Principal Distribution Amount: For any Distribution Date, the sum of
(i) the Basic Principal Distribution Amount for such Distribution Date and
(ii) the Extra Principal Distribution Amount for such Distribution Date.
Principal Prepayment: Any full or partial payment or other recovery
of principal on a Mortgage Loan (including upon liquidation of a Mortgage
Loan) which is received in advance of its scheduled Due Date, including any
Prepayment Premium, and which is not accompanied by an amount of interest
representing scheduled interest due on any date or dates in any month or
months subsequent to the month of prepayment.
Principal Prepayment in Full: Any Principal Prepayment made by a
Mortgagor of the entire principal balance of a Mortgage Loan.
Principal Prepayment Period: With respect to any Distribution Date,
the calendar month preceding the month in which that Distribution Date occurs.
Principal Remittance Amount: With respect to any Distribution Date
and the Mortgage Loans, the amount equal to the sum of the following amounts
(without duplication): (i) all scheduled payments of principal due on the Due
Date on such Mortgage Loans in the related Due Period and received on or prior
to the related Determination Date, together with any Monthly Advances in
respect thereof; (ii) all Condemnation Proceeds, Insurance Proceeds and
Liquidation Proceeds allocable to principal and received during the related
Principal Prepayment
39
Period; (iii) all Principal Prepayments allocable to principal and received
during the related Principal Prepayment Period; (iv) all amounts received with
respect to such Distribution Date representing the portion of the purchase
price allocable to principal in connection with a purchase or repurchase of a
Deleted Mortgage Loan; (v) principal portion of all amounts received with
respect to such Distribution Date as a Substitution Adjustment Amount and
received in connection with the substitution of a Mortgage Loan and (vi) the
allocable portion of the proceeds received with respect to the termination of
the Trust Fund pursuant to clause (a) of Section 11.01 (to the extent such
proceeds relate to principal).
Private Certificates: As specified in the Preliminary Statement.
Prospectus Supplement: The Prospectus Supplement, dated January 26,
2007, relating to the Offered Certificates.
PTCE: Prohibited Transaction Class Exemption, issued by the U.S.
Department of Labor.
PUD: A planned unit development.
Purchaser: ▇▇▇▇▇▇▇ Sachs Mortgage Company, a New York limited
partnership, and its successors in interest.
Rating Agency: Each of the Rating Agencies specified in the
Preliminary Statement. If such organization or a successor is no longer in
existence, "Rating Agency" shall be such nationally recognized statistical
rating organization, or other comparable Person, as is designated by the
Depositor, notice of which designation shall be given to the Trustee and the
Securities Administrator. References herein to a given rating or rating
category of a Rating Agency shall mean such rating category without giving
effect to any modifiers. For purposes of Section 12.05(b), the addresses for
notices to each Rating Agency shall be the address specified therefor in the
definition corresponding to the name of such Rating Agency, or such other
address as either such Rating Agency may hereafter furnish to the Depositor
and the Servicer.
Realized Losses: With respect to any date of determination and any
Liquidated Mortgage Loan, the amount, if any, by which (a) the unpaid
principal balance of such Liquidated Mortgage Loan together with accrued and
unpaid interest thereon exceeds (b) the Liquidation Proceeds with respect
thereto net of the expenses incurred by the Servicer in connection with the
liquidation of such Liquidated Mortgage Loan and net of any amount of
unreimbursed Servicing Advances with respect to such Liquidated Mortgage Loan.
Record Date: With respect to any Distribution Date, the close of
business on the last Business Day of the related Interest Accrual Period;
provided, however, that for any Definitive Certificate issued pursuant to
Section 5.02(e), the Record Date shall be the close of business on the last
Business Day of the month immediately preceding the month in which the related
Distribution Date occurs.
Reference Bank: As defined in Section 4.04.
Regular Certificates: As specified in the Preliminary Statement.
40
Regulation AB: Subpart 229.1100 - Asset Backed Securities (Regulation
AB), 17 C.F.R. ss.ss.229.1100-229.1123, as such may be amended from time to
time, and subject to such clarification and interpretation as have been
provided by the Commission in the adopting release (Asset-Backed Securities,
Securities Act Release No. 33-8518, 70 Fed. Reg. 1,506, 1,531 (Jan. 7, 2005))
or by the staff of the Commission, or as may be provided by the Commission or
its staff from time to time.
Relief Act Interest Shortfall: With respect to any Distribution Date
and any Mortgage Loan, any reduction in the amount of interest collectible on
such Mortgage Loan for the most recently ended Due Period as a result of the
application of the Servicemembers' Civil Relief Act of 1940 or any similar
state statutes.
REMIC: A "real estate mortgage investment conduit" within the meaning
of Section 860D of the Code.
REMIC Provisions: Provisions of the federal income tax law relating
to real estate mortgage investment conduits, which appear at Sections 860A
through 860G of Subchapter M of Chapter 1 of the Code, and related provisions,
and regulations promulgated thereunder, as the foregoing may be in effect from
time to time as well as provisions of applicable state laws.
Remittance Date: With respect to any Distribution Date, the 18th day
(or if such 18th day is not a Business Day, the first Business Day immediately
preceding such 18th day) of the month in which such Distribution Date occurs.
REO Disposition: The final sale by the Servicer of any REO Property.
REO Property: A Mortgaged Property acquired by the Trust Fund through
foreclosure or deed-in-lieu of foreclosure in connection with a defaulted
Mortgage Loan.
Reportable Event: As defined in Section 13.02.
Reporting Party: The Depositor, any Originator, the Master Servicer,
any Servicer, any originator defined in the Prospectus Supplement, any swap or
corridor contract counterparty, any credit enhancement provider described
herein and any other material transaction party (excluding the Trustee and the
Custodians) as may be mutually agreed between the Depositor and the Master
Servicer from time to time for the purpose of complying with the requirements
of the Commission.
Reporting Servicer: As defined in Section 13.04.
Reporting Subcontractor: With respect to the Master Servicer or the
Securities Administrator, any Subcontractor determined by such Person pursuant
to Section 11.08(b) to be "participating in the servicing function" within the
meaning of Item 1122 of Regulation AB. References to a Reporting Subcontractor
shall refer only to the Subcontractor of such Person and shall not refer to
Subcontractors generally.
Residual Certificates: As specified in the Preliminary Statement.
41
Responsible Officer: When used with respect to the Securities
Administrator or the Master Servicer, any vice president, any assistant vice
president, any assistant secretary, any assistant treasurer, any associate or
any other officer of the Securities Administrator or the Master Servicer,
customarily performing functions similar to those performed by any of the
above designated officers who at such time shall be officers to whom, with
respect to a particular matter, such matter is referred because of such
officer's knowledge of and familiarity with the particular subject and who
shall have direct responsibility for the administration of this Agreement.
When used with respect to the Trustee, any officer of the Trustee having
direct responsibility for the administration of this transaction, or to whom
corporate trust matters are referred because of that officer's knowledge of
and familiarity with the particular subject.
Responsible Party: Countrywide and GreenPoint, each in its capacity
as seller under the applicable Sale Agreement. With respect to the Goldman
Conduit Mortgage Loans, the Purchaser.
Rule 144A: Rule 144A under the Securities Act.
Rule 144A Letter: As defined in Section 5.02(b).
Sale Agreement: Each of the Countrywide Sale Agreement, the
GreenPoint Sale Agreement and the Goldman Conduit Sale Agreement.
▇▇▇▇▇▇▇▇-▇▇▇▇▇ Certification: As defined in Section 13.06.
Securities Act: The Securities Act of 1933, as amended.
Securities Administrator: ▇▇▇▇▇ Fargo, and if a successor securities
administrator is appointed hereunder, such successor.
Senior Enhancement Percentage: With respect to any Distribution Date,
the percentage obtained by dividing (x) the sum of (i) the aggregate Class
Certificate Balance of the Subordinated Certificates and (ii) the
Overcollateralized Amount (in each case after taking into account the
distributions of the Principal Distribution Amount for such Distribution Date)
by (y) the aggregate Stated Principal Balance of the Mortgage Loans as of the
first day of the month in which such Distribution Date occurs.
Senior Specified Enhancement Percentage: As of any date of
determination, 13.60%.
Sequential Trigger Event: An event which occurs, if (x) on any
Distribution Date before the 37th Distribution Date the aggregate amount of
Realized Losses incurred since the cut-off date through the last day of the
related Prepayment Period divided by the aggregate scheduled principal balance
of the Mortgage Loans as of the cut-off date exceeds 0.550%, or (y) on any
Distribution Date on or after the 37th Distribution Date, a Trigger Event is
in effect.
Servicer: Each of Avelo, Countrywide Servicing, GreenPoint and
Wachovia, in its capacity as servicer under the related Servicing Agreement,
or any successor servicer appointed pursuant to such Servicing Agreement.
42
Servicing Advances: As defined in the related Servicing Agreement.
Servicing Agreement: Each of the Avelo Servicing Agreement, the
Countrywide Servicing Agreement, the GreenPoint Servicing Agreement and the
Wachovia Servicing Agreement.
Servicing Criteria: The "servicing criteria" set forth in Item
1122(d) of Regulation AB, as the same may be amended from time to time.
Servicing Fee: As defined in the related Servicing Agreement.
Servicing Fee Rate: With respect to each Mortgage Loan, the per annum
rate for such Mortgage Loan specified on the Mortgage Loan Schedule.
Servicing File: As defined in the applicable Servicing Agreement.
Servicing Function Participant: Any Subservicer, Subcontractor or any
other Person, other than each Servicer, the Master Servicer, the Trustee, the
Securities Administrator and any Custodian, that is performing activities
addressed by the Servicing Criteria.
Similar Law: As defined in Section 5.02(b).
Specified Overcollateralized Amount: Prior to the Stepdown Date, an
amount equal to 0.50% of the Cut-off Date Pool Principal Balance. On and after
the Stepdown Date, an amount equal to 1.00% of the aggregate Stated Principal
Balance of the Mortgage Loans for such Distribution Date, subject, until the
Class Certificate Balance of each Class of LIBOR Certificates has been reduced
to zero, to a minimum amount equal to the Overcollateralization Floor;
provided, however, that if, on any Distribution Date, a Trigger Event has
occurred, the Specified Overcollateralized Amount shall not be reduced to the
applicable percentage of the then current aggregate Stated Principal Balance
of the Mortgage Loans but instead will remain the same as the prior period's
Specified Overcollateralized Amount until the Distribution Date on which a
Trigger Event is no longer occurring. When the Class Certificate Balance of
each Class of LIBOR Certificates has been reduced to zero, the Specified
Overcollateralized Amount will thereafter be zero.
Standard & Poor's or S&P: Standard & Poor's Ratings Services, a
division of The ▇▇▇▇▇▇-▇▇▇▇ Companies, Inc. If Standard & Poor's is designated
as a Rating Agency in the Preliminary Statement, for purposes of Section
12.05(b) the address for notices to Standard & Poor's shall be Standard &
Poor's, ▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇, Attention: Residential
Mortgage Surveillance Group - GSAA Home Equity Trust 2007-1, or such other
address as Standard & Poor's may hereafter furnish to the Depositor and the
Servicer.
Startup Day: The Closing Date.
Stated Principal Balance: As to each Mortgage Loan and as of any
Determination Date, (i) the principal balance of the Mortgage Loan at the
Cut-off Date after giving effect to payments of principal due on or before
such date (whether or not received), minus (ii) all amounts previously
remitted to the Securities Administrator with respect to the related Mortgage
43
Loan representing payments or recoveries of principal including advances in
respect of scheduled payments of principal. For purposes of any Distribution
Date, the Stated Principal Balance of any Mortgage Loan will give effect to
any scheduled payments of principal received or advanced prior to the related
Remittance Date and any unscheduled principal payments and other unscheduled
principal collections received during the related Principal Prepayment Period,
and the Stated Principal Balance of any Mortgage Loan that has prepaid in full
or has become a Liquidated Mortgage Loan during the related Principal
Prepayment Period shall be zero.
Step 1 Assignment Agreement: Each of the (i) Assignment, Assumption
and Recognition Agreement, dated as of January 30, 2007, between the
Purchaser, Countrywide, Countrywide Servicing and the Depositor, (ii)
Assignment, Assumption and Recognition Agreement, dated as of January 30,
2007, between the Purchaser, GreenPoint and the Depositor; (iii) Assignment,
Assumption and Recognition Agreement, dated as of January 30, 2007, between
the Purchaser, Avelo and the Depositor; and (iv) Assignment, Assumption and
Recognition Agreement, dated as of January 30, 2007, between the Purchaser,
Wachovia and the Depositor.
Step 2 Assignment Agreement: Each of the (i) Assignment, Assumption
and Recognition Agreement, dated as of January 30, 2007, between the
Depositor, the Master Servicer, the Trustee, Countrywide and Countrywide
Servicing, (ii) Assignment, Assumption and Recognition Agreement, dated as of
January 30, 2007, between the Depositor, the Master Servicer, the Trustee and
GreenPoint; (iii) Assignment, Assumption and Recognition Agreement, dated as
of January 30, 2007, between the Depositor, the Master Servicer, the Trustee
and Avelo; and (iv) Assignment, Assumption and Recognition Agreement, dated
January 30, 2007, between the Depositor, the Master Servicer, the Trustee and
Wachovia.
Stepdown Date: The earlier to occur of (a) the date on which the
aggregate Class Certificate Balance of the Class A Certificates has been
reduced to zero and (b) the later to occur of (i) the Distribution Date in
February 2010 and (ii) the first Distribution Date following the Distribution
Date on which the Senior Enhancement Percentage is greater than or equal to
the Senior Specified Enhancement Percentage after giving effect to the
distribution on such Distribution Date.
Subcontractor: Any vendor, subcontractor or other Person that is not
responsible for the overall servicing (as "servicing" is commonly understood
by participants in the mortgage-backed securities market) of Mortgage Loans
but performs one or more discrete functions identified in Item 1122(d) of
Regulation AB with respect to Mortgage Loans under the direction or authority
of the Master Servicer, any Servicer, any subservicer or the Securities
Administrator, as the case may be.
Subordinated Certificates: As specified in the Preliminary Statement.
Subsequent Recoveries: Amounts received with respect to any
Liquidated Mortgage Loan after it has become a Liquidated Mortgage Loan.
Substitution Adjustment Amount: With respect to any Servicing
Agreement or Sale Agreement, as applicable, in which substitution is
permitted, or with respect to a Mortgage
44
Loan substituted by the Purchaser, an amount of cash received from the
applicable Servicer or the Purchaser, as applicable, in connection with a
substitution for a Deleted Mortgage Loan.
Supplemental Interest Trust: The corpus of a trust created pursuant
to Section 4.05 of this Agreement, consisting of the Interest Rate Swap
Agreement, subject to the obligation to pay amounts specified in Section 4.05.
Swap Provider: ▇▇▇▇▇▇▇ Sachs Mitsui Marine Derivative Products, L.P.,
a Delaware limited partnership, and its successors in interest, and any
successor swap provider under any replacement Interest Rate Swap Agreement.
Swap Termination Payment: Any payment payable by the Supplemental
Interest Trust or the Swap Provider upon termination of the Interest Rate Swap
Agreement as a result of an Event of Default (as defined in the Interest Rate
Swap Agreement) or a Termination Event (as defined in the Interest Rate Swap
Agreement).
Tax Matters Person: The Holder of the Class R, Class RC and Class RX
Certificates is designated as "tax matters person" of the Lower-Tier REMIC,
Middle-Tier REMIC and the Upper-Tier REMIC, respectively, in the manner
provided under Treasury Regulations Section 1.806F-4(d) and Treasury
Regulations Section 301.6234(a)(7)-1.
Telerate Page 3750: The display page currently so designated on the
Bridge Telerate Service (or such other page as may replace that page on that
service for displaying comparable rates or prices).
Termination Price: As defined in Section 11.01.
Total Monthly Excess Spread: As to any Distribution Date, an amount
equal to the excess if any, of (i) the interest collected (prior to the
related Remittance Date) or advanced on the Mortgage Loans for Due Dates
during the related Due Period (net of Expense Fees) plus the Net Swap Receipt
Amount and minus any Net Swap Payment Amount over (ii) the sum of the interest
payable to the LIBOR Certificates on such Distribution Date pursuant to
Section 4.01(a)(i); provided, that Net Swap Receipts shall be included in
Total Monthly Excess Spread (and correspondingly, in Extra Principal
Distribution Amount) only to the extent of current or prior Realized Losses
not previously reimbursed.
Transaction Documents: This Agreement, the Interest Rate Swap
Agreement, the Assignment Agreements and any other document or agreement
entered into in connection with the Trust Fund, the Certificates or the
Mortgage Loans.
Transfer: Any direct or indirect transfer or sale of any Ownership
Interest in a Residual Certificate.
Transfer Affidavit: As defined in Section 5.02(c)(ii).
Transferor Certificate: As defined in Section 5.02(b).
45
Trigger Event: With respect to any Distribution Date, a Trigger Event
exists if (i) on such Distribution Date the quotient (expressed as a
percentage) of (x) the rolling three month average of the aggregate unpaid
principal balance of 60+ Day Delinquent Mortgage Loans, and (y) the aggregate
unpaid principal balance of the Mortgage Loans as of the last day of the
related Due Period equals or exceeds 40.00% of the Senior Enhancement
Percentage as of the last day of the prior Due Period or (ii) the quotient
(expressed as a percentage) of (x) the aggregate amount of Realized Losses
incurred since the Cut-off Date through the last day of the related Principal
Prepayment Period divided by (y) the Cut-off Date Pool Principal Balance
exceeds the applicable percentages set forth below with respect to such
Distribution Date:
Distribution Date Occurring In Loss Percentage
February 2009 - January 2010 0.200% for the first month, plus an
additional 1/12th of 0.350% for each
month thereafter (e.g., approximately
0.229% in March 2009)
February 2010 - January 2011 0.550% for the first month, plus an
additional 1/12th of 0.350% for each
month thereafter (e.g., approximately
0.579% in March 2010)
February 2011 - January 2012 0.900% for the first month, plus an
additional 1/12th of 0.400% for each
month thereafter (e.g., approximately
0.933% in March 2011)
February 2012 - January 2013 1.300% for the first month, plus an
additional 1/12th of 0.250% for each
month thereafter (e.g., approximately
1.321% in March 2012)
February 2013 and thereafter 1.550%
Trust: The express trust created hereunder in Section 2.01(c).
Trust Fund: The corpus of the trust created hereunder consisting of
(i) the Mortgage Loans and all interest and principal received on or with
respect thereto after the related Cut-off Date, other than such amounts which
were due on the Mortgage Loans on or before the related Cut-off Date; (ii) the
Interest Rate Swap Agreement and all amounts received thereunder; (iii) the
Excess Reserve Fund Account, the Distribution Account, and all amounts
deposited therein pursuant to the applicable provisions of this Agreement;
(iv) property that secured a Mortgage Loan and has been acquired by
foreclosure, deed-in-lieu of foreclosure or otherwise; (v) the rights of the
Trust under the Step 2 Assignment Agreements; (vi) the Supplemental Interest
Trust; and (vii) all proceeds of the conversion, voluntary or involuntary, of
any of the foregoing. The Trust Fund created hereunder is referred to as the
GSAA Home Equity Trust 2007-1.
Trust REMIC: As specified in the Preliminary Statement.
46
Trustee: U.S. Bank, and its successors in interest, and, if a
successor trustee is appointed hereunder, such successor.
Underwriters' Exemption: Any exemption listed in footnote 1 of, and
amended by, Prohibited Transaction Exemption 2002-41, 67 Fed. Reg. 54487
(2002), or amended by Prohibited Transaction Exemption 2002-19, 67 Fed. Reg.
14979, or any successor exemption.
Unpaid Interest Amount: As of any Distribution Date and any Class of
Certificates, the sum of (a) the portion of the Accrued Certificate Interest
from Distribution Dates remaining unpaid prior to the current Distribution
Date and (b) interest on the amount in clause (a) at the applicable
Pass-Through Rate (to the extent permitted by applicable law).
U.S. Bank: U.S. Bank National Association, a national banking
association, and its successors in interest.
U.S. Person: (i) A citizen or resident of the United States; (ii) a
corporation (or entity treated as a corporation for tax purposes) created or
organized in the United States or under the laws of the United States or of
any State thereof, including, for this purpose, the District of Columbia;
(iii) a partnership (or entity treated as a partnership for tax purposes)
organized in the United States or under the laws of the United States or of
any State thereof, including, for this purpose, the District of Columbia
(unless provided otherwise by future Treasury regulations); (iv) an estate
whose income is includible in gross income for United States income tax
purposes regardless of its source; or (v) a trust, if a court within the
United States is able to exercise primary supervision over the administration
of the trust and one or more U.S. Persons have authority to control all
substantial decisions of the trust. Notwithstanding the last clause of the
preceding sentence, to the extent provided in Treasury regulations, certain
trusts in existence on August 20, 1996, and treated as U.S. Persons prior to
such date, may elect to continue to be U.S. Persons.
Upper-Tier Regular Interest: As described in the Preliminary
Statement.
Upper-Tier REMIC: As described in the Preliminary Statement.
Voting Rights: The portion of the voting rights of all of the
Certificates which is allocated to any Certificate. As of any date of
determination, (a) 1% of all Voting Rights shall be allocated to the Class X
Certificates, if any (such Voting Rights to be allocated among the holders of
Certificates of each such Class in accordance with their respective Percentage
Interests), (b) 1% of all Voting Rights shall be allocated to the Class P
Certificates, if any (such Voting Rights to be allocated among the holders of
Certificates of each such Class in accordance with their respective Percentage
Interests), and (c) the remaining Voting Rights shall be allocated among
Holders of the remaining Classes of Certificates in proportion to the
Certificate Balances of their respective Certificates on such date.
WAC Cap: With respect to the Mortgage Loans as of any Distribution
Date, a per annum rate equal to the product of (i) the sum of (A) the weighted
average of the Adjusted Net Mortgage Interest Rates then in effect on the
beginning of the related Due Period on the Mortgage Loans, and (B) the Net
Swap Receipt Amount, if any, less the Net Swap Payment Amount, if any, divided
by the Stated Principal Balance of the Mortgage Loans at the beginning
47
of the related Due Period multiplied by 12 and (ii) 30 divided by the actual
number of days in the related Interest Accrual Period, in the case of the
LIBOR Certificates.
Wachovia: Wachovia Mortgage Corporation, a North Carolina
corporation, and its successors in interest.
Wachovia Servicing Agreement: The Seller's Purchase, Warranties and
Servicing Agreement, dated as of April 1, 2006, between Wachovia and GSMC.
▇▇▇▇▇ Fargo: ▇▇▇▇▇ Fargo Bank, National Association, a national
banking association, and its successors in interest.
ARTICLE II
CONVEYANCE OF MORTGAGE LOANS;
REPRESENTATIONS AND WARRANTIES
Section 2.01 Conveyance of Mortgage Loans. (a) The Depositor,
concurrently with the execution and delivery hereof, hereby sells, transfers,
assigns, sets over and otherwise conveys to the Trustee for the benefit of the
Certificateholders, without recourse, all the right, title and interest of the
Depositor in and to the Trust Fund.
(b) In connection with the transfer and assignment of each Mortgage
Loan, the Depositor has delivered or caused to be delivered to the applicable
Custodian on behalf of the Trustee for the benefit of the Certificateholders
the following documents or instruments with respect to each applicable
Mortgage Loan so assigned:
(i) the original Mortgage Note, endorsed without recourse in blank
by the last endorsee, including all intervening endorsements showing a
complete chain of endorsement from the originator to the last endorsee;
(ii) The original Assignment of Mortgage in blank (or, in the case
of the ▇▇▇▇▇▇▇ Conduit Mortgage Loans, in form and substance acceptable
for recording or if the Mortgage is to be recorded, assigned to the
Purchaser), unless the Mortgage Loan is a MERS Loan;
(iii) personal endorsement, surety and/or guaranty agreements
executed in connection with all non individual Mortgage Loans
(corporations, partnerships, trusts, estates, etc. (if any);
(iv) the related original Mortgage and evidence of its recording or
a certified copy of the Mortgage with evidence of recording;
(v) originals of any intervening Mortgage assignment or certified
copies in either case necessary to show a complete chain of title from
the original mortgagee to the seller and evidencing recording; provided,
that, except in the case of the ▇▇▇▇▇▇▇ Conduit Mortgage Loans, the
assignment may be in the form of a blanket assignment or assignments, a
copy of which with evidence of recording shall be acceptable;
48
(vi) originals of all assumption, modification, consolidation or
extension agreements or certified copies thereof, in either case with
evidence of recording if required to maintain the lien of the mortgage or
if otherwise required, or, if recordation is not required, an original or
copy of the agreement; provided, that, in the case of the ▇▇▇▇▇▇▇ Conduit
Mortgage Loans, an original with evidence of recording thereon is always
required;
(vii) if applicable to the files held by the applicable Custodian,
an original or copy of a title insurance policy or evidence of title;
(viii) to the extent applicable, an original power of attorney;
(ix) for each Mortgage Loan (if applicable to the files held by the
applicable Custodian) with respect to which the Mortgagor's name as it
appears on the note does not match the borrower's name on the Mortgage
Loan Schedule, one of the following: the original of the assumption
agreement, or a certified copy thereof, in either case with evidence of
recording thereon if required to maintain the lien of the mortgage or if
otherwise required, or, if recordation is not so required, an original or
copy of such assumption agreement;
(x) if applicable to the files held by the applicable Custodian, a
security agreement, chattel mortgage or equivalent document executed in
connection with the Mortgage, if any; and
(xi) with respect to each Mortgage Loan, the complete Custodial File
including all items as set forth in the applicable Servicing Agreement to
the extent in the possession of the Depositor or the Depositor's Agents.
The Depositor shall deliver or cause each Responsible Party to
deliver to each Custodian the applicable recorded document promptly upon
receipt from the respective recording office but in no event later than 120
days from the Closing Date.
From time to time, pursuant to the applicable Sale Agreement, the
Responsible Party may forward to the applicable Custodian additional original
documents, additional documents evidencing an assumption, modification,
consolidation or extension of a Mortgage Loan, in accordance with the terms of
the applicable Sale Agreement. All such mortgage documents held by the
Custodians as to each Mortgage Loan shall constitute the "Custodial File."
On or prior to the Closing Date, the Depositor shall deliver to the
Custodians Assignments of Mortgages (except in the case of MERS Loans), in
blank, for each applicable Mortgage Loan. On the Closing Date, the Depositor
shall provide a written request to each Responsible Party to submit the
Assignments of Mortgage for recordation, at the Responsible Party's expense,
pursuant to the applicable Sale Agreement. Each Custodian shall deliver the
Assignment of Mortgages to be submitted for recordation to the applicable
Responsible Party upon receipt of a written request for release in standard
and customary form as set forth in Exhibit L, Exhibit L-1 or Exhibit L-2, as
applicable.
49
On or prior to the Closing Date, the Depositor shall deliver to the
Custodians and the Master Servicer a copy of the Mortgage Loan Schedule in
electronic, machine readable medium in a form mutually acceptable to the
Depositor, the applicable Custodian, the Master Servicer and the Trustee.
In the event that such original or copy of any document submitted for
recordation to the appropriate public recording office is not so delivered to
the Custodian within the time period and in the manner specified in the
applicable Sale Agreement, the Trustee shall take or cause to be taken such
remedial actions under the Sale Agreement against the applicable Responsible
Party as may be permitted to be taken thereunder, including without
limitation, if applicable, the repurchase by the applicable Responsible Party
of such Mortgage Loan. The foregoing repurchase remedy shall not apply in the
event that the Responsible Party cannot deliver such original or copy of any
document submitted for recordation to the appropriate public recording office
within the specified period due to a delay caused by the recording office in
the applicable jurisdiction; provided, that the applicable Responsible Party
shall instead deliver a recording receipt of such recording office or, if such
recording receipt is not available, an officer's certificate of an officer of
the applicable Responsible Party, confirming that such document has been
accepted for recording.
Notwithstanding anything to the contrary contained in this Section
2.01, in those instances where the public recording office retains or loses
the original Mortgage or assignment after it has been recorded, the
obligations of the Responsible Party shall be deemed to have been satisfied
upon delivery by the Responsible Party to the applicable Custodian prior to
the Closing Date of a copy of such Mortgage or assignment, as the case may be,
certified (such certification to be an original thereof) by the public
recording office to be a true and complete copy of the recorded original
thereof.
(c) The Depositor does hereby establish, pursuant to the further
provisions of this Agreement and the laws of the State of New York, an express
trust (the "Trust") to be known, for convenience, as "GSAA Home Equity Trust
2007-1" and U.S. Bank is hereby appointed as Trustee in accordance with the
provisions of this Agreement.
(d) It is the policy and intention of the Trust that none of the
Mortgage Loans included in the Trust is (a) covered by the Home Ownership and
Equity Protection Act of 1994, or (b) considered a "high cost home,"
"threshold," "predatory" or "covered" loan (excluding "covered home loans" as
defined under clause (1) of the definition of "covered home loans" in the New
Jersey Home Ownership Security Act of 2002) under applicable state, federal or
local laws.
Section 2.02 Acceptance by the Custodians of the Mortgage Loans. Each
Custodian acknowledges receipt of the documents identified in the Initial
Certification, subject to any exceptions listed on the exception report
attached thereto, in the form annexed hereto as Exhibit E, and declares that
it holds and will hold such documents and the other documents delivered to it
pursuant to Section 2.01, and that it holds or will hold such other assets as
are included in the Trust Fund, in trust for the exclusive use and benefit of
all present and future Certificateholders. Deutsche Bank, as Custodian,
acknowledges that it will maintain possession of the related Mortgage Notes in
the State of California, unless otherwise permitted by the Rating
50
Agencies, BNY, as Custodian, acknowledges that it will maintain possession of
the related Mortgage Notes in the State of Texas, unless otherwise permitted
by the Rating Agencies and U.S. Bank, as Custodian, acknowledges that it will
maintain possession of the related Mortgage Notes in the State of Minnesota.
Prior to and as a condition to the Closing, each Custodian shall
deliver via facsimile (with original to follow the next Business Day) to the
Depositor an Initial Certification prior to the Closing Date, or as the
Depositor agrees to, on the Closing Date, certifying receipt of a Mortgage
Note and Assignment of Mortgage, subject to any exceptions listed on the
exception report attached thereto, for each Mortgage Loan. None of the
Custodians shall be responsible for verifying the validity, sufficiency or
genuineness of any document in any Custodial File.
On the Closing Date, each Custodian shall ascertain that all
documents required to be delivered to it on or prior to the Closing Date are
in its possession, subject to any exceptions listed on the exception report
attached thereto, and shall deliver to the Depositor and the Trustee an
Initial Certification, in the form annexed hereto as Exhibit E, and shall
deliver to the Depositor and the Trustee a Document Certification and
Exception Report, in the form annexed hereto as Exhibit F, within ninety (90)
days after the Closing Date to the effect that, as to each applicable Mortgage
Loan listed in the Mortgage Loan Schedule (other than any Mortgage Loan paid
in full or any Mortgage Loan specifically identified in such certification as
an exception and not covered by such certification): (i) all documents
required to be delivered to it are in its possession; (ii) such documents have
been reviewed by it and appear regular on their face and relate to such
Mortgage Loan; (iii) based on its examination and only as to the foregoing
documents, as to Deutsche Bank, the information set forth in items 2, 8, 33,
and 34 of the Mortgage Loan Schedule respecting such Mortgage Loan is correct;
(iv) based on its examination and only as to the foregoing documents, as to
BNY, the information set forth in items 2, 8, 33, and 34 of the Mortgage Loan
Schedule respecting such Mortgage Loan is correct; (v) based on its
examination and only as to the foregoing documents, as to U.S. Bank, the
information set forth in items 2, 8, 33, and 34 of the Mortgage Loan Schedule
respecting such Mortgage Loan is correct; (vi) based on its examination and
only as to the foregoing documents, as to ▇▇▇▇▇ Fargo, the information set
forth in items 2, 8, 34, and 35 of the Mortgage Loan Schedule respecting such
Mortgage Loan is correct; and (vii) each Mortgage Note has been endorsed as
provided in Section 2.01 of this Agreement. None of the Custodians shall be
responsible for verifying the validity, sufficiency or genuineness of any
document in any Custodial File.
Each Custodian shall retain possession and custody of each applicable
Custodial File in accordance with and subject to the terms and conditions set
forth herein. The Servicer shall promptly deliver to the applicable Custodian,
upon the execution or receipt thereof, the originals of such other documents
or instruments constituting the Custodial File as come into the possession of
the Servicer from time to time.
Each Custodian shall notify the Trustee and the Depositor of any
Mortgage Loans that do not conform to the requirements of Sections 2.01 and
2.02 hereof by delivery of the Document Certification and Exception Report. In
its capacity as "Assignee" under the Step 2 Assignment Agreements, the Trustee
shall enforce the obligation of the Responsible Parties to cure or repurchase
Mortgage Loans that do not conform to such requirements as determined in
51
the applicable Custodian's review as required herein, or based upon
notification from the Master Servicer (who shall be entitled to rely on
information regarding any such defaults by a Responsible Party that has been
provided by the applicable Servicer for purposes of providing such
notification to the Trustee), by notifying the applicable Responsible Party to
correct or cure such default. In its capacity as "Assignee" under the Step 2
Assignment Agreements, the Trustee shall also enforce the obligation of the
Responsible Parties under the Sale Agreements, and to the extent applicable,
of any Servicer under the Servicing Agreements, and of the Purchaser under the
Step 1 Assignment Agreements to cure or repurchase Mortgage Loans for which
there is a defect or a breach of a representation or warranty thereunder of
which a Responsible Officer of the Trustee has actual knowledge, by notifying
the applicable party to correct or cure such default. If the Trustee obtains
actual knowledge that any Servicer, any Responsible Party or the Purchaser, as
the case may be, fails or is unable to correct or cure the defect or breach
within the period set forth in the applicable agreement, the Trustee shall
notify the Depositor of such failure to correct or cure. Unless otherwise
directed by the Depositor within five (5) Business Days after notifying the
Depositor of such failure by the applicable party to correct or cure, the
Trustee shall notify such party to repurchase the Mortgage Loan. If, within
ten (10) Business Days of receipt of such notice by such party, such party
fails to repurchase such Mortgage Loan, the Trustee shall notify the Depositor
of such failure. The Trustee shall pursue all legal remedies available to the
Trustee against the Servicers, the Responsible Parties and the Purchaser, as
applicable, under this Agreement, if the Trustee has received written notice
from the Depositor directing the Trustee to pursue such remedies and the
Trustee shall be entitled to reimbursement from the Trust Fund for any
reasonable expenses incurred in pursuing such remedies.
Section 2.03 Execution and Delivery of Certificates. The Trustee
acknowledges the transfer and assignment to it of the Trust Fund and,
concurrently with such transfer and assignment, the Securities Administrator
has executed and delivered to or upon the order of the Depositor, the
Certificates in authorized denominations evidencing directly or indirectly the
entire ownership of the Trust Fund. The Trustee agrees to hold the Trust Fund
and exercise the rights referred to above for the benefit of all present and
future Holders of the Certificates.
Section 2.04 REMIC Matters. The Preliminary Statement sets forth the
designations for federal income tax purposes of all interests created hereby.
The "Startup Day" for purposes of the REMIC Provisions shall be the Closing
Date. The "latest possible maturity date" is February 25, 2037, and for
distributions on the residual certificates, is January 25, 2047, which is the
Distribution Date following the latest Mortgage Loan maturity date. Amounts
paid to the Class X Certificates (prior to any reduction for any Basis Risk
Payment or Swap Termination Payment) shall be deemed paid from the Upper-Tier
REMIC to the Class X REMIC in respect of the Class X Interest and from the
Class X REMIC to the holders of the Class X Certificates prior to distribution
of Basis Risk Payments to the LIBOR Certificates.
Amounts distributable to the Class X Certificates (prior to any
reduction for any Net Swap Receipt Amounts, Net Swap Payment Amounts or Swap
Termination Payment), shall be deemed paid from the Class X REMIC to the
Holders of the Class X Certificates prior to distribution of any Basis Risk
Payments to the LIBOR Certificates.
For federal income tax purposes, any amount distributed on the LIBOR
Certificates on any such Distribution Date in excess of their Pass Through
Rate, calculated by
52
substituting the REMIC Cap for the applicable cap in respect of the related
Certificates shall be treated as having been paid from the Excess Reserve Fund
Account or the Supplemental Interest Trust, as applicable, and any excess of
the REMIC Cap over the amount distributable on such Class of LIBOR
Certificates on such Distribution Date shall be treated as having been paid to
the Supplemental Interest Trust, all pursuant to, and as further provided in,
Section 8.14.
Section 2.05 Representations and Warranties of the Depositor. The
Depositor hereby represents, warrants and covenants to the Trustee that as of
the date of this Agreement or as of such date specifically provided herein:
(a) The Depositor is a corporation duly organized, validly existing
and in good standing under the laws of the State of Delaware;
(b) The Depositor has the corporate power and authority to convey the
Mortgage Loans and to execute, deliver and perform, and to enter into and
consummate the transactions contemplated by, this Agreement;
(c) This Agreement has been duly and validly authorized, executed and
delivered by the Depositor, all requisite corporate action having been taken,
and, assuming the due authorization, execution and delivery hereof by the
other parties hereto, constitutes or will constitute the legal, valid and
binding agreement of the Depositor, enforceable against the Depositor in
accordance with its terms, except as such enforcement may be limited by
bankruptcy, insolvency, reorganization, moratorium or other similar laws
relating to or affecting the rights of creditors generally, and by general
equity principles (regardless of whether such enforcement is considered in a
proceeding in equity or at law);
(d) No consent, approval, authorization or order of or registration
or filing with, or notice to, any governmental authority or court is required
for the execution, delivery and performance of or compliance by the Depositor
with this Agreement or the consummation by the Depositor of any of the
transactions contemplated hereby, except as have been made on or prior to the
Closing Date;
(e) None of the execution and delivery of this Agreement, the
consummation of the transactions contemplated hereby or thereby, or the
fulfillment of or compliance with the terms and conditions of this Agreement,
(i) conflicts or will conflict with or results or will result in a breach of,
or constitutes or will constitute a default or results or will result in an
acceleration under (A) the charter or bylaws of the Depositor, or (B) any
term, condition or provision of any material indenture, deed of trust,
contract or other agreement or instrument to which the Depositor or any of its
subsidiaries is a party or by which it or any of its subsidiaries is bound;
(ii) results or will result in a violation of any law, rule, regulation,
order, judgment or decree applicable to the Depositor of any court or
governmental authority having jurisdiction over the Depositor or its
subsidiaries; or (iii) results in the creation or imposition of any lien,
charge or encumbrance which would have a material adverse effect upon the
Mortgage Loans or any documents or instruments evidencing or securing the
Mortgage Loans;
(f) There are no actions, suits or proceedings before or against or
investigations of, the Depositor pending, or to the knowledge of the
Depositor, threatened, before
53
any court, administrative agency or other tribunal, and no notice of any such
action, which, in the Depositor's reasonable judgment, might materially and
adversely affect the performance by the Depositor of its obligations under
this Agreement, or the validity or enforceability of this Agreement;
(g) The Depositor is not in default with respect to any order or
decree of any court or any order, regulation or demand of any federal, state,
municipal or governmental agency that may materially and adversely affect its
performance hereunder; and
(h) Immediately prior to the transfer and assignment by the Depositor
to the Trustee on the Closing Date, the Depositor had good title to, and was
the sole owner of each Mortgage Loan, free of any interest of any other
Person, and the Depositor has transferred all right, title and interest in
each Mortgage Loan to the Trustee. The transfer of each Mortgage Note and each
Mortgage as and in the manner contemplated by this Agreement is sufficient
either (i) fully to transfer to the Trustee, for the benefit of the
Certificateholders, all right, title, and interest of the Depositor thereto as
note holder and mortgagee or (ii) to grant to the Trustee, for the benefit of
the Certificateholders, the security interest referred to in Section 12.04
hereof.
It is understood and agreed that the representations, warranties and
covenants set forth in this Section 2.05 shall survive delivery of the
respective Custodial Files to the Custodians, and shall inure to the benefit
and to Certificateholders.
Section 2.06 Representations and Warranties of BNY. BNY, as
Custodian, hereby represents and warrants to the Depositor, the Master
Servicer and the Trustee, as of the Closing Date:
(a) Such Custodian is duly organized and is validly existing and in
good standing under the laws of its jurisdiction of incorporation and is duly
authorized and qualified to transact any and all business contemplated by this
Agreement to be conducted by such Custodian or is otherwise not required under
applicable law to effect such qualification and, in any event, is in
compliance with the doing business laws of any such state, to the extent
necessary to perform any of its obligations under this Agreement in accordance
with the terms thereof.
(b) Such Custodian has the full power and authority to execute,
deliver and perform, and to enter into and consummate the transactions
contemplated by this Agreement and has duly authorized by all necessary action
on the part of such Custodian the execution, delivery and performance of this
Agreement; and this Agreement, assuming the due authorization, execution and
delivery thereof by the other parties thereto, constitutes a legal, valid and
binding obligation of such Custodian, enforceable against such Custodian in
accordance with its terms, except that (i) the enforceability thereof may be
limited by bankruptcy, insolvency, moratorium, receivership and other similar
laws relating to creditors' rights generally and (ii) the remedy of specific
performance and injunctive and other forms of equitable relief may be subject
to equitable defenses and to the discretion of the court before which any
proceeding therefor may be brought.
(c) The execution and delivery of this Agreement by such Custodian,
the consummation of any other of the transactions contemplated by this
Agreement, and the
54
fulfillment of or compliance with the terms thereof are in the ordinary course
of business of such Custodian and will not result in a material breach of any
term or provision of the articles of association or by laws of such Custodian.
Section 2.07 Representations and Warranties of Deutsche Bank.
Deutsche Bank, in its capacity as a Custodian, hereby represents and warrants
to the Depositor, the Master Servicer and the Trustee, as of the Closing Date:
(a) Such Custodian is duly organized and is validly existing and in
good standing under the laws of its jurisdiction of incorporation and is duly
authorized and qualified to transact any and all business contemplated by this
Agreement to be conducted by such Custodian or is otherwise not required under
applicable law to effect such qualification and, in any event, is in
compliance with the doing business laws of any such state, to the extent
necessary to perform any of its obligations under this Agreement in accordance
with the terms thereof.
(b) Such Custodian has the full power and authority to execute,
deliver and perform, and to enter into and consummate the transactions
contemplated by this Agreement and has duly authorized by all necessary action
on the part of such Custodian the execution, delivery and performance of this
Agreement; and this Agreement, assuming the due authorization, execution and
delivery thereof by the other parties thereto, constitutes a legal, valid and
binding obligation of such Custodian, enforceable against such Custodian in
accordance with its terms, except that (i) the enforceability thereof may be
limited by bankruptcy, insolvency, moratorium, receivership and other similar
laws relating to creditors' rights generally and (ii) the remedy of specific
performance and injunctive and other forms of equitable relief may be subject
to equitable defenses and to the discretion of the court before which any
proceeding therefor may be brought.
(c) The execution and delivery of this Agreement by such Custodian,
the consummation of any other of the transactions contemplated by this
Agreement, and the fulfillment of or compliance with the terms thereof are in
the ordinary course of business of such Custodian and will not result in a
material breach of any term or provision of the articles of association or by
laws of such Custodian.
Section 2.08 Representations and Warranties of U.S. Bank. U.S. Bank
hereby represents and warrants to the Depositor, the Master Servicer and the
Trustee, as of the Closing Date:
(a) Such Custodian is duly organized and is validly existing and in
good standing under the laws of its jurisdiction of incorporation and is duly
authorized and qualified to transact any and all business contemplated by this
Agreement to be conducted by such Custodian or is otherwise not required under
applicable law to effect such qualification and, in any event, is in
compliance with the doing business laws of any such state, to the extent
necessary to perform any of its obligations under this Agreement in accordance
with the terms thereof.
(b) Such Custodian has the full power and authority to execute,
deliver and perform, and to enter into and consummate the transactions
contemplated by this Agreement and has duly authorized by all necessary action
on the part of such Custodian the execution, delivery
55
and performance of this Agreement; and this Agreement, assuming the due
authorization, execution and delivery thereof by the other parties thereto,
constitutes a legal, valid and binding obligation of such Custodian,
enforceable against such Custodian in accordance with its terms, except that
(i) the enforceability thereof may be limited by bankruptcy, insolvency,
moratorium, receivership and other similar laws relating to creditors' rights
generally and (ii) the remedy of specific performance and injunctive and other
forms of equitable relief may be subject to equitable defenses and to the
discretion of the court before which any proceeding therefor may be brought.
(c) The execution and delivery of this Agreement by such Custodian,
the consummation of any other of the transactions contemplated by this
Agreement, and the fulfillment of or compliance with the terms thereof are in
the ordinary course of business of such Custodian and will not result in a
material breach of any term or provision of the articles of incorporation or
by laws of such Custodian.
ARTICLE III
TRUST ACCOUNTS
Section 3.01 Excess Reserve Fund Account; Distribution Account. (a)
The Securities Administrator shall establish and maintain the Excess Reserve
Fund Account to receive any Basis Risk Payment and to secure their limited
recourse obligation to pay to the LIBOR Certificateholders any Basis Risk
Carry Forward Amounts (prior to using any Net Swap Receipt Amounts). On each
Distribution Date, the Securities Administrator shall deposit the amount of
any Basis Risk Payment received by it for such date into the Excess Reserve
Fund Account. For the avoidance of doubt, any Basis Risk Carry Forward Amounts
shall be paid to the LIBOR Certificates first from the Excess Reserve Fund
Account and then from the Supplemental Interest Trust.
On each Distribution Date on which there exists a Basis Risk Carry
Forward Amount on any Class or Classes of LIBOR Certificates, the Securities
Administrator shall (1) withdraw from the Distribution Account, to the extent
of funds available therefor in the Distribution Account, and deposit in the
Excess Reserve Fund Account, as set forth in Section 4.01(a)(iii)(d), the
lesser of (x) the Class X Distributable Amount (without regard to the
reduction in clause (iii) of the definition thereof with respect to Basis Risk
Payments) (to the extent remaining after the distributions specified in
Sections 4.01(a)(iii)(a)-(c)) and (y) the aggregate Basis Risk Carry Forward
Amount of the LIBOR Certificates for such Distribution Date and (2) withdraw
from the Excess Reserve Fund Account and the Supplemental Interest Account
amounts necessary (including Net Swap Payment Amounts or Swap Termination
Payments (other than amounts received pursuant to an ISDA Credit Support Annex
negotiated between the Trust and the Swap Provider)) to pay to such Class or
Classes of Certificates the related Basis Risk Carry Forward Amount. Such
payments shall be allocated to those Classes based upon the amount of Basis
Risk Carry Forward Amount owed to each such Class and shall be paid in the
priority set forth in Section 4.01(a)(iii)(e).
The Securities Administrator shall account for the Excess Reserve
Fund Account as an asset of a grantor trust under subpart E, Part I of
subchapter J of the Code and not as an
56
asset of any Trust REMIC created pursuant to this Agreement. The beneficial
owners of the Excess Reserve Fund Account are the Class X Certificateholders.
For all federal income tax purposes, amounts transferred to the Excess Reserve
Fund Account shall be treated as distributions by the Securities Administrator
from the Upper-Tier REMIC to the Class X Interest and from the Class X REMIC
to the Class X Certificates and then contributed by the Class X
Certificateholders to the Excess Reserve Fund Account.
Any Tax Basis Risk Carry Forward Amounts distributed by the
Securities Administrator to the Principal Certificateholders shall be
accounted for by the Securities Administrator, for federal income tax
purposes, as amounts paid first to the Holders of the Class X Certificates and
then to the respective Class or Classes of LIBOR Certificates in accordance
with the priority of payments in this Section 3.01. In addition, the
Securities Administrator shall account for the Principal Certificateholders'
rights to receive payments of Basis Risk Carry Forward Amounts as rights in a
limited recourse interest rate cap contract written by the Class X
Certificateholders in favor of the Holders of each such Class.
Notwithstanding any provision contained in this Agreement, the
Securities Administrator shall not be required to make any distributions from
the Excess Reserve Fund Account except as expressly set forth in this Section
3.01(a). (b) The Securities Administrator shall establish and maintain the
Distribution Account on behalf of the Certificateholders. The amount remitted
by the Servicer to the Master Servicer on each Remittance Date shall be
credited to the Distribution Account within two (2) Business Days once the
amounts are identified as a remittance in connection with the Trust and
reconciled to the reports provided by the Servicer. The Securities
Administrator shall establish and maintain the Distribution Account on behalf
of the Certificateholders. The Master Servicer shall, promptly upon receipt on
the Business Day received, deposit in the Distribution Account and retain
therein the following:
(i) the aggregate amount remitted by the Servicers to the Master
Servicer pursuant to the Servicing Agreements;
(ii) any Net Swap Receipt Amounts or Swap Termination Payments
(other than amounts received pursuant to an ISDA Credit Support Annex
negotiated between the Trust and the Swap Provider) remitted by the Swap
Provider; and
(iii) any other amounts deposited hereunder which are required to be
deposited in the Distribution Account.
In the event that any Servicer shall remit any amount not required to
be remitted pursuant to the applicable Servicing Agreement, and such Servicer
directs the Master Servicer in writing to withdraw such amount from the
Distribution Account, the Master Servicer shall return such funds to the
applicable Servicer. All funds deposited in the Distribution Account shall be
held by the Securities Administrator in trust for the Certificateholders until
disbursed in accordance with this Agreement or withdrawn in accordance with
Section 4.01.
57
(c) From time to time, the Securities Administrator may also
establish any other accounts for the purposes of carrying out its duties
hereunder (including, without limitation, any account necessary under the
Interest Rate Swap Agreement).
Section 3.02 Investment of Funds in the Distribution Account. (a)
Other than during the Master Servicer Float Period, the Depositor shall direct
the investment of funds held in the Distribution Account in one or more
Permitted Investments. Absent such direction, the Securities Administrator
shall invest such funds during such period in the ▇▇▇▇▇ Fargo Advantage Prime
Investment Money Market Fund so long as such fund is a Permitted Investment.
The Securities Administrator may (but shall not be obligated to) invest funds
in the Distribution Account during the Master Servicer Float Period (for
purposes of this Section 3.02, such Account is referred to as an "Investment
Account"), in one or more Permitted Investments bearing interest or sold at a
discount, and maturing, unless payable on demand, or maturing on such
Distribution Date, in the case of an investment that is an obligation of ▇▇▇▇▇
Fargo, no later than the Business Day immediately preceding the date on which
such funds are required to be withdrawn from such account pursuant to this
Agreement. All such Permitted Investments shall be held to maturity, unless
payable on demand. Any investment of funds in an Investment Account shall be
made in the name of the Securities Administrator. The Securities Administrator
shall be entitled to sole possession over each such investment, and any
certificate or other instrument evidencing any such investment shall be
delivered directly to the Securities Administrator or its agent, together with
any document of transfer necessary to transfer title to such investment to the
Securities Administrator. In the event amounts on deposit in an Investment
Account are at any time invested in a Permitted Investment payable on demand,
the Securities Administrator may:
(x) consistent with any notice required to be given
thereunder, demand that payment thereon be made on
the last day such Permitted Investment may
otherwise mature hereunder in an amount equal to
the lesser of (1) all amounts then payable
thereunder and (2) the amount required to be
withdrawn on such date; and
(y) demand payment of all amounts due thereunder that
such Permitted Investment would not constitute a
Permitted Investment in respect of funds thereafter
on deposit in the Investment Account.
(b) All income and gain realized from the investment of funds
deposited in the Distribution Account held by the Securities Administrator
during the Master Servicer Float Period shall be subject to the Securities
Administrator's withdrawal in the manner set forth in Section 10.05.
(c) Except as otherwise expressly provided in this Agreement, if any
default occurs in the making of a payment due under any Permitted Investment,
or if a default occurs in any other performance required under any Permitted
Investment, the Securities Administrator shall take such action as may be
appropriate to enforce such payment or performance, including the institution
and prosecution of appropriate proceedings. Notwithstanding the foregoing, the
Depositor shall be liable to the Trust for any loss on any investment of funds
in the Distribution Account other than during the Master Servicer Float Period
and the Securities Administrator
58
shall be liable to the Trust for any such loss on any funds it has invested
under this Section 3.02 only during the Master Servicer Float Period, and the
Depositor or the Securities Administrator, as the case may be, shall deposit
funds in the amount of such loss in the Distribution Account promptly after
such loss is incurred.
(d) The Securities Administrator or its Affiliates are permitted to
receive additional compensation that could be deemed to be in the Securities
Administrator's economic self-interest for (i) serving as investment adviser,
administrator, shareholder, servicing agent, custodian or sub-custodian with
respect to certain of the Permitted Investments, (ii) using Affiliates to
effect transactions in certain Permitted Investments and (iii) effecting
transactions in certain Permitted Investments. Such compensation is not
payable or reimbursable under Section 8.06 of this Agreement.
(e) In order to comply with its duties under the USA PATRIOT Act of
2001, U.S. Bank, as Trustee and as a Custodian and BNY, as a Custodian, may
obtain and verify certain information and documentation from the other parties
to this Agreement including, but not limited to, each such party's name,
address and other identifying information.
(f) In order to comply with laws, rules and regulations applicable to
banking institutions, including those relating to the funding of terrorist
activities and money laundering, Deutsche Bank, as a Custodian, is required to
obtain, verify and record certain information relating to individuals and
entities which maintain a business relationship with Deutsche Bank.
Accordingly, each of the parties agrees to provide to Deutsche Bank upon its
request from time to time such party's complete name, address, tax
identification number and such other identifying information together with
copies of such party's constituting documentation, securities disclosure
documentation and such other identifying documentation as may be available for
such party.
ARTICLE IV
DISTRIBUTIONS
Section 4.01 Priorities of Distribution. (a) On each Distribution
Date, the Securities Administrator shall make the disbursements and transfers
from amounts then on deposit in the Distribution Account in the following
order of priority and to the extent of the Available Funds remaining:
(i) to the holders of each Class of LIBOR Certificates and to the
Supplemental Interest Trust in the following order of priority:
(a) to the Supplemental Interest Trust, the sum of (x) all Net Swap
Payment Amounts and (y) any Swap Termination Payment owed to the Swap
Provider other than a Defaulted Swap Termination Payment owed to the Swap
Provider, if any;
(b) concurrently, (x) from the Interest Remittance Amount allocable
to the Group I Mortgage Loans, to the Class 1A Certificates, their
Accrued Certificate Interest and Unpaid Interest Amounts, allocated pro
rata based on their respective entitlements to those amounts and (y) from
the Interest Remittance Amount allocable to
59
the Group II Mortgage Loans, to the Class 2A Certificates, their Accrued
Certificate Interests and Unpaid Interest Amounts, allocated pro rata
based on their respective entitlements to those amounts (provided, that
if such funds allocable to either group of Mortgage Loans are
insufficient to make the related payments set forth above, any such
funds allocable to the other group remaining after making the related
payments set forth above will be available to cover that shortfall);
(c) from any remaining Interest Remittance Amounts, to the Class M
Certificates, sequentially, in ascending numerical order, their related
Accrued Certificate Interest Distribution Amount for that Distribution
Date; and
(d) from any remaining Interest Remittance Amounts, to the Class B
Certificates sequentially, in ascending numerical order, their related
Accrued Certificate Interest Distribution Amount for that Distribution
Date;
(ii) (A) on each Distribution Date (x) prior to the Stepdown Date or
(y) with respect to which a Trigger Event is in effect, to the holders of the
Class or Classes of LIBOR Certificates and Residual Certificates then entitled
to distributions of principal as set forth below, an amount equal to the
Principal Distribution Amount in the following order of priority:
(a) concurrently, to the Class R, Class RC and Class RX
Certificates, pro rata, from the Principal Distribution Amount related to
the Group II Mortgage Loans, until their respective Class Certificate
Balances have been reduced to zero;
(b) to the Class A Certificates, in the following order of priority:
concurrently,
(i) from the Principal Distribution Amount related to the Class 1A
Certificates (based on the Class A Principal Allocation
Percentage), in the following order of priority:
(1) sequentially, to the Class 1A1 and Class 1A2 Certificates,
in that order, until their respective Class Certificate
Balances have been reduced to zero; and
(2) concurrently, to the 1A3A and 1A3B Components, allocated
pro rata, until their respective principal balances have
been reduced to zero; with the exception that if a
Sequential Trigger Event is in effect, principal
distributions to the 1A3A and 1A3B Components will be
allocated sequentially, to the 1A3A and 1A3B Components,
in that order, until their principal balances have been
reduced to zero; and
(ii) from the Principal Distribution Amount related to the Class 2A
Certificates (based on the Class A Principal Allocation
Percentage), in the following order of priority:
60
(1) concurrently, to the Class 2A1A and Class 2A1B
Certificates, allocated pro rata, until their respective
Class Certificate Balances have been reduced to zero; with
the exception that if a Sequential Trigger Event is in
effect, principal distributions to the Class 2A1A and
Class 2A1B Certificates will be allocated sequentially to
the Class 2A1A and Class 2A2B Certificates, in that order,
until their respective Class Certificate Balances have
been reduced to zero; and
(2) concurrently, to the 2A2A and 2A2B Components,
allocated pro rata, until their respective principal
balances have been reduced to zero; with the exception
that if a Sequential Trigger Event is in effect, principal
distributions to the 2A2A and 2A2B Components will be
allocated sequentially, to the 2A2A and 2A2B Components,
in that order, until their respective principal balances
have been reduced to zero;
provided, that if the Class Certificate Balances and component principal
balances of either Class 1A Certificates or the Class 2A Certificates is
reduced to zero, then the remaining amount of principal distributions
distributable to the Class A Certificates and the amount of those principal
distributions on each subsequent Distribution Date will be distributed to the
Class A Certificates remaining outstanding in accordance with the applicable
distribution priorities in this clause (b), until their respective Class
Certificate Balances have been reduced to zero;
(c) from any remaining Principal Distribution Amounts, to the Class
M Certificates, sequentially, in ascending numerical order, until their
respective Class Certificate Balances have been reduced to zero; and
(d) from any remaining Principal Distribution Amounts, to the Class
B Certificates, sequentially, in ascending numerical order, until their
respective Class Certificate Balances have been reduced to zero;
(B) on each Distribution Date (x) on or after the Stepdown Date and
(y) as long as a Trigger Event is not in effect, to the holders of the Class
or Classes of LIBOR Certificates then entitled to distribution of principal as
set forth below, an amount equal to the Principal Distribution Amount in the
following order of priority:
(a) to the Class A Certificates, in the following order of priority:
(i) concurrently,
(1) to the Class 1A Certificates, in each case, in an
aggregate amount equal to the lesser of the allocable
portion for the Class 1A Certificates (based on the Class
A Principal Allocation Percentage) of the Principal
Distribution Amount and the allocable portion for the
Class 1A Certificates (based on the Class A Principal
Allocation Percentage) of the Class A Principal
Distribution Amount allocated in the following order of
priority:
61
(A) sequentially, to the Class 1A1 and Class 1A2
Certificates, until their respective Class
Certificate Balances have been reduced to zero; and
(B) concurrently, to the 1A3A and 1A3B Components,
allocated pro rata, until their respective principal
balances have been reduced to zero; and
(2) to the Class 2A Certificates, in each case, in an
aggregate amount equal to the lesser of the allocable
portion for the Class 2A Certificates (based on the Class
A Principal Allocation Percentage) of the Principal
Distribution Amount and the allocable portion for the
Class 2A Certificates (based on the Class A Principal
Allocation Percentage) of the Class A Principal
Distribution Amount allocated in the following order of
priority:
(A) concurrently, to the Class 2A1A and Class 2A1B
Certificates, allocated pro rata, until their
respective Class Certificate Balances have been
reduced to zero; and
(B) concurrently, to the 2A2A and 2A2B Components,
allocated pro rata, until their respective principal
balances have been reduced to zero; and
provided that if the Class Certificate Balances and component principal
balances of either the Class 1A Certificates or the Class 2A Certificates is
reduced to zero, then the remaining amount of principal distributions
distributable to the Class A Certificates on such Distribution Date and the
amount of those principal distributions on each subsequent Distribution Date
will be distributed to the Class A Certificates remaining outstanding in
accordance with the applicable distribution priorities in this clause (a),
until their respective Class Certificate Balances have been reduced to zero;
(b) to the Class M1 Certificates, the lesser of (x) the excess of
(i) the Principal Distribution Amount over (ii) the amount distributed to
the Class A Certificates in clause (ii)(B)(a) above and (y) the Class M1
Principal Distribution Amount, until their Class Certificate Balance has
been reduced to zero;
(c) to the Class M2 Certificates, the lesser of (x) the excess of
(i) the Principal Distribution Amount over (ii) the amount distributed to
the Class A Certificates in clause (ii)(B)(a) above and to the Class M1
Certificates in clause (ii)(B)(b) above and (y) the Class M2 Principal
Distribution Amount, until their Class Certificate Balance has been
reduced to zero;
(d) to the Class M3 Certificates, the lesser of (x) the excess of
(i) the Principal Distribution Amount over (ii) the amount distributed to
the Class A Certificates in clause (ii)(B)(a) above, to the Class M1
Certificates in clause (ii)(B)(b) above and to the Class M2 Certificates
in clause (ii)(B)(c) above and (y) the Class M3 Principal Distribution
Amount, until their Class Certificate Balance has been reduced to zero;
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(e) to the Class M4 Certificates, the lesser of (x) the excess of
(i) the Principal Distribution Amount over (ii) the amount distributed to
the Class A Certificates in clause (ii)(B)(a) above, to the Class M1
Certificates in clause (ii)(B)(b) above, to the Class M2 Certificates in
clause (ii)(B)(c) above and to the Class M3 Certificates in clause
(ii)(B)(d) above and (y) the Class M4 Principal Distribution Amount,
until their Class Certificate Balance has been reduced to zero;
(f) to the Class M5 Certificates, the lesser of (x) the excess of
(i) the Principal Distribution Amount over (ii) the amount distributed to
the Class A Certificates in clause (ii)(B)(a) above, to the Class M1
Certificates in clause (ii)(B)(b) above, to the Class M2 Certificates in
clause (ii)(B)(c) above, to the Class M3 Certificates in clause
(ii)(B)(d) above and to the Class M4 Certificates in clause (ii)(B)(e)
above and (y) the Class M5 Principal Distribution Amount, until their
Class Certificate Balance has been reduced to zero;
(g) to the Class M6 Certificates, the lesser of (x) the excess of
(i) the Principal Distribution Amount over (ii) the amount distributed to
the Class A Certificates in clause (ii)(B)(a) above, to the Class M1
Certificates in clause (ii)(B)(b) above, to the Class M2 Certificates in
clause (ii)(B)(c) above, to the Class M3 Certificates in clause
(ii)(B)(d) above, to the Class M4 Certificates in clause (ii)(B)(e) above
and to the Class M5 Certificates in clause (ii)(B)(f) above and (y) the
Class M6 Principal Distribution Amount, until their Class Certificate
Balance has been reduced to zero;
(h) to the Class B1 Certificates, the lesser of (x) the excess of
(i) the Principal Distribution Amount over (ii) the amount distributed to
the Class A Certificates in clause (ii)(B)(a) above, to the Class M1
Certificates in clause (ii)(B)(b) above, to the Class M2 Certificates in
clause (ii)(B)(c) above, to the Class M3 Certificates in clause
(ii)(B)(d) above, to the Class M4 Certificates in clause (ii)(B)(e)
above, to the Class M5 Certificates in clause (ii)(B)(f) above and to the
Class M6 Certificates in clause (ii)(B)(g) above and (y) the Class B1
Principal Distribution Amount, until their Class Certificate Balance has
been reduced to zero;
(i) to the Class B2 Certificates, the lesser of (x) the excess of
(i) the Principal Distribution Amount over (ii) the amount distributed to
the Class A Certificates in clause (ii)(B)(a) above, to the Class M1
Certificates in clause (ii)(B)(b) above, to the Class M2 Certificates in
clause (ii)(B)(c) above, to the Class M3 Certificates in clause
(ii)(B)(d) above, to the Class M4 Certificates in clause (ii)(B)(e)
above, to the Class M5 Certificates in clause (ii)(B)(f) above, to the
Class M6 Certificates in clause (ii)(B)(g) above and to the Class B1
Certificates in clause (ii)(B)(h) above and (y) the Class B2 Principal
Distribution Amount, until their Class Certificate Balance has been
reduced to zero; and
(j) to the Class B3 Certificates, the lesser of (x) the excess of
(i) the Principal Distribution Amount over (ii) the amount distributed to
the Class A Certificates in clause (ii)(B)(a) above, to the Class M1
Certificates in clause (ii)(B)(b) above, to the Class M2 Certificates in
clause (ii)(B)(c) above, to the Class M3 Certificates in clause
(ii)(B)(d) above, to the Class M4 Certificates in clause (ii)(B)(e)
above, to the Class M5
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Certificates in clause (ii)(B)(f) above, to the Class M6 Certificates in
clause (ii)(B)(g) above, to the Class B1 Certificates in clause
(ii)(B)(h) above and to the Class B2 Certificates in clause (ii)(B)(i)
above and (y) the Class B3 Principal Distribution Amount, until their
Class Certificate Balance has been reduced to zero; and
(iii) any Available Funds remaining after the distributions in
clauses (i) and (ii) above is required to be distributed in the following
order of priority with respect to the certificates:
(a) if and to the extent that the Interest Remittance Amounts
distributed pursuant to clause (i) above were insufficient to make the
full distributions in respect of interest set forth in such clause, (x)
to the holders of each Class of the Class A Certificates, any Accrued
Certificate Interests and Unpaid Interest Amounts, pro rata among such
Classes based on their entitlement to those amounts, and then (y) to the
holders of each Class of the Class M and Class B Certificates, any
Accrued Certificate Interests for that Distribution Date, in the order
of priority for such Classes set forth in clause (i) above;
(b) to the Class M Certificates, sequentially, in ascending
numerical order, any Unpaid Interest Amounts for those Classes;
(c) to the Class B Certificates, sequentially, in ascending
numerical order, any Unpaid Interest Amounts for those Classes;
(d) to the Excess Reserve Fund Account, the amount of any Basis Risk
Payment (without regard to Net Swap Receipt Amounts) for that
Distribution Date;
(e) from funds on deposit in the Excess Reserve Fund Account with
respect to that Distribution Date, an amount equal to any Basis Risk
Carry Forward Amount with respect to the LIBOR Certificates for that
Distribution Date in the same order and priority in which accrued
certificate interest is allocated among those Classes of Certificates,
with the allocation to the Class A Certificates being allocated pro rata
based on their Class Certificate Balances or component principal
balances, as applicable; provided, that, if for any Distribution Date,
after the allocation of the remaining unpaid Basis Risk Carry Forward
Amounts to the Class A Certificates, the remaining unpaid Basis Risk
Carry Forward Amount for any of the Class A Certificates or any component
is reduced to zero, any amount of remaining unpaid Basis Risk Carry
Forward Amount that would have been allocated to that Class A Certificate
or component for that Distribution Date will instead be allocated, pro
rata, based on their respective remaining unpaid Basis Risk Carry Forward
Amounts, to the other Class A Certificates (and with respect to the
Component Classes, to the related Components) to the extent the other
Class A Certificates (or Components) have any remaining unpaid Basis Risk
Carry Forward Amounts;
(f) if a 40-Year Trigger Event is in effect, then any remaining
amounts will be distributed first, to the Class A Certificates, allocated
in the order of priority for such Classes set forth in clauses (a)(i) and
(a)(ii) above, and then sequentially to the Class M1, Class M2, Class,
M3, Class M4, Class M5, Class M6, Class B1, Class B2 and Class
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B3 Certificates, the lesser of (x) any remaining amounts and (y) the
amount necessary to increase the actual Overcollateralized Amount for
such Distribution Date so the 40-Year Trigger Event is no longer in
effect, in each case, until their respective Class Certificate Balances
have been reduced to zero;
(g) to the Supplemental Interest Trust, the amount of any Defaulted
Swap Termination Payment owed to the Swap Provider;
(h) to the Class X Certificates, the Class X Distributable Amount
not distributed pursuant to Section 4.01(a)(iii)(a) - (g); and
(i) to the holders of the Class R Certificates, any remaining
amount.
On each Distribution Date, all amounts representing Prepayment
Premiums from the Mortgage Loans received during the related Principal
Prepayment Period shall be distributed by the Securities Administrator to the
holders of the Class P Certificates.
Notwithstanding the foregoing description of allocation of principal
distributions to the Class A Certificates, from and after the Distribution
Date on which the aggregate Class Certificate Balance of the Subordinated
Certificates and the Overcollateralized Amount have been reduced to zero, any
principal distributions to the holders of the Class A Certificates on any
Distribution Date will be allocated pro rata based on their respective Class
Certificate Balances until their respective Class Certificate Balances have
been reduced to zero, except that so long as a Sequential Trigger Event is in
effect, principal distributions (i) to the 1A3A and 1A3B Components will be
allocated sequentially, to the 1A3A and 1A3B Components, in that order, until
their respective principal balances have been reduced to zero, (ii) to the
2A2A and 2A2B Components shall be allocated sequentially, to the 2A2A and 2A2B
Components, in that order, until their respective principal balances have been
reduced to zero and (iii) to the Class 2A1A and Class 2A1B Certificates will
be allocated to the Class 2A1A Certificates, until its Class Certificate
Balance has been reduced to zero, and then to the Class 2A1B Certificates,
until its Class Certificate Balance has been reduced to zero.
On any Distribution Date, any Relief Act Shortfalls and any Net
Prepayment Interest Shortfalls will be allocated first to excess interest on
the Mortgage Loans for the related Distribution Date and thereafter as a
reduction to the Accrued Certificate Interest for the Principal Certificates
on a pro rata basis based on the respective amounts of interest accrued on
those certificates for that Distribution Date. The holders of the Principal
Certificates will not be entitled to reimbursement for the allocation of any
of those shortfalls described in the preceding sentence.
Upon any exercise of the purchase option set forth in Section
11.01(a), the Securities Administrator shall distribute to the holders of the
Class RC Certificates any amounts required to be distributed on the Class RC
Certificates pursuant to Section 11.01 or 11.02.
Section 4.03 Monthly Statements to Certificateholders. (a) Not later
than each Distribution Date, the Securities Administrator shall make available
to each Certificateholder, the Depositor, the Trustee and each Rating Agency a
statement based, in part, upon the information provided by the Servicers
setting forth with respect to the related distribution:
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(i) the amount thereof allocable to principal, separately
identifying the aggregate amount of any Principal Prepayments and
Liquidation Proceeds included therein;
(ii) the amount thereof allocable to interest, any Unpaid Interest
Amount included in such distribution and any remaining Unpaid Interest
Amount after giving effect to such distribution, any Basis Risk Carry
Forward Amount for such Distribution Date and the amount of all Basis
Risk Carry Forward Amount covered by withdrawals from the Excess Reserve
Fund Account on such Distribution Date;
(iii) if the distribution to the Holders of such Class of
Certificates is less than the full amount that would be distributable to
such Holders if there were sufficient funds available therefor, the
amount of the shortfall and the allocation thereof as between principal
and interest, including any Basis Risk Carry Forward Amount not covered
by amounts in the Excess Reserve Fund Account;
(iv) the Class Certificate Balance of each Class of Certificates and
the notional amount of the Class P Certificates after giving effect to
the distribution of principal on such Distribution Date;
(v) the aggregate Stated Principal Balance of the Mortgage Loans for
the following Distribution Date;
(vi) the amount of the expenses and fees paid to or retained by the
Servicer and paid to or retained by the Trustee with respect to such
Distribution Date;
(vii) the amount of any Administrative Fees paid to the Master
Servicer or Securities Administrator with respect to such Distribution
Date;
(viii) the Pass-Through Rate for each such Class of Certificates
with respect to such Distribution Date;
(ix) the amount of P&I Advances included in the distribution on such
Distribution Date and the aggregate amount of P&I Advances reported by
the Servicers (and the Master Servicer, the Trustee as successor master
servicer and any other successor master servicer, if applicable) as
outstanding as of the close of business on the Determination Date
immediately preceding such Distribution Date;
(x) the number and aggregate outstanding principal balances of
Mortgage Loans (1) as to which the Monthly Payment is delinquent 31 to 60
days, 61 to 90 days and 91 or more days (each to be calculated using the
OTS method), (2) that have become REO Property, (3) that are in
foreclosure and (4) that are in bankruptcy, in each case as of the close
of business on the last Business Day of the immediately preceding month;
(xi) the total number and principal balance of any REO Properties
(and market value, if available) as of the close of business on the
Determination Date preceding such Distribution Date;
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(xii) whether a Trigger Event has occurred and is continuing
(including the calculation demonstrating the existence of the Trigger
Event and the aggregate outstanding balance of all 60+ Day Delinquent
Mortgage Loans);
(xiii) the amount on deposit in the Excess Reserve Fund Account
(after giving effect to distributions on such Distribution Date);
(xiv) in the aggregate and for each Class of Certificates, the
aggregate amount of Applied Realized Loss Amounts incurred during the
preceding calendar month and aggregate Applied Realized Loss Amounts
through such Distribution Date;
(xv) the amount of any Net Monthly Excess Cash Flow on such
Distribution Date and the allocation thereof to the Certificateholders
with respect to Unpaid Interest Amounts;
(xvi) the Overcollateralized Amount and Specified Overcollateralized
Amount;
(xvii) the Prepayment Premiums collected by or paid by the
Servicers;
(xviii) the percentage equal to the aggregate realized losses
divided by the aggregate Stated Principal Balance of the Mortgage Loans
as of the Cut-off Date;
(xix) the amount distributed on the Class X and Class P
Certificates;
(xx) the amount of any Subsequent Recoveries for such Distribution
Date; and
(xxi) updated Mortgage Loan information, such as weighted average
interest rate, and weighted average remaining term.
(b) The Securities Administrator's responsibility for providing the
above statement to the Certificateholders, each Rating Agency, the Trustee and
the Depositor is limited to the availability, timeliness and accuracy of the
information derived from the Master Servicer, the Servicers and the
Responsible Parties. The Securities Administrator shall provide the above
statement via the Securities Administrator's internet website. Assistance in
using the website can be obtained by calling the Securities Administrator's
investor relations desk at (▇▇▇) ▇▇▇-▇▇▇▇. The Securities Administrator will
also make a paper copy of the above statement available upon request.
(c) Upon request, within a reasonable period of time after the end of
each calendar year, the Securities Administrator shall cause to be furnished
to each Person who at any time during the calendar year was a
Certificateholder, a statement containing the information set forth in clauses
(a)(i), (a)(ii), (a)(iii) and (a)(vii) of this Section 4.02 aggregated for
such calendar year or applicable portion thereof during which such Person was
a Certificateholder. Such obligation of the Securities Administrator shall be
deemed to have been satisfied to the extent that substantially comparable
information shall be provided by the Securities Administrator pursuant to any
requirements of the Code as from time to time in effect.
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The Securities Administrator shall be entitled to rely on information
provided by third parties for purposes of preparing the foregoing report, but
shall not be responsible for the accuracy of such information.
Section 4.03 Allocation of Applied Realized Loss Amounts. Any Applied
Realized Loss Amounts will be allocated to the most junior Class of
Subordinated Certificates then outstanding in reduction of the Class
Certificate Balance thereof. In the event, Applied Realized Loss Amounts are
allocated to any Class of Certificates, their Class Certificate Balance shall
be reduced by the amount so allocated and no funds shall be distributed with
respect to the written down amounts or with respect to interest or Basis Risk
Carry Forward Amounts on the written down amounts on that Distribution Date or
any future Distribution Dates, even if funds are otherwise available therefor.
Notwithstanding the foregoing, the Class Certificate Balance of each
Class of Subordinated Certificates that has been previously reduced by Applied
Realized Loss Amounts will be increased, in the order of seniority, by the
amount of the Subsequent Recoveries (but not in excess of the Applied Realized
Loss Amount allocated to the applicable Class of Subordinated Certificates).
Section 4.04 Certain Matters Relating to the Determination of LIBOR.
LIBOR shall be calculated by the Securities Administrator in accordance with
the definition of "LIBOR." Until all of the LIBOR Certificates are paid in
full, the Securities Administrator will at all times retain at least four
Reference Banks for the purpose of determining LIBOR with respect to each
LIBOR Determination Date. The Securities Administrator initially shall
designate the Reference Banks (after consultation with the Depositor). Each
"Reference Bank" shall be a leading bank engaged in transactions in Eurodollar
deposits in the international Eurocurrency market, shall not control, be
controlled by, or be under common control with, the Securities Administrator
and shall have an established place of business in London. If any such
Reference Bank should be unwilling or unable to act as such or if the
Securities Administrator should terminate its appointment as Reference Bank,
the Securities Administrator shall promptly appoint or cause to be appointed
another Reference Bank (after consultation with the Depositor). The Securities
Administrator shall have no liability or responsibility to any Person for (i)
the selection of any Reference Bank for purposes of determining LIBOR or (ii)
any inability to retain at least four Reference Banks which is caused by
circumstances beyond its reasonable control.
The Pass-Through Rate for each Class of LIBOR Certificates for each
Interest Accrual Period shall be determined by the Securities Administrator on
each LIBOR Determination Date so long as the LIBOR Certificates are
outstanding on the basis of LIBOR and the respective formulae appearing in
footnotes corresponding to the LIBOR Certificates in the table relating to the
Certificates in the Preliminary Statement. The Securities Administrator shall
not have any liability or responsibility to any Person for its inability,
following a good faith reasonable effort, to obtain quotations from the
Reference Banks or to determine the arithmetic mean referred to in the
definition of LIBOR, all as provided for in this Section 4.04 and the
definition of LIBOR. The establishment of LIBOR and each Pass-Through Rate for
the LIBOR Certificates by the Securities Administrator shall (in the absence
of manifest error) be final, conclusive and binding upon each Holder of a
Certificate and the Trustee.
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Section 4.05 Supplemental Interest Trust. On the Closing Date, the
Securities Administrator on behalf of the Trustee shall establish and maintain
a separate non-interest bearing trust (the "Supplemental Interest Trust") to
which the Securities Administrator will transfer and assign the Interest Rate
Swap Agreement. The Supplemental Interest Trust shall be an Eligible Account,
and funds on deposit therein shall be held separate and apart from, and shall
not be commingled with, any other moneys, including, without limitation, other
moneys of the Securities Administrator held pursuant to this Agreement.
On any Distribution Date, Swap Termination Payments, Net Swap Payment
Amounts owed to the Swap Provider and Net Swap Receipt Amounts for that
Distribution Date will be deposited into the Supplemental Interest Trust.
Funds in the Supplemental Interest Trust will be distributed in the following
order of priority:
(i) to the Swap Provider, the sum of (x) all Net Swap Payment
Amounts and (y) any Swap Termination Payment, other than a Defaulted
Swap Termination Payment, to the Swap Provider, if any, owed for that
Distribution Date;
(ii) to the Certificateholders, to pay Accrued Certificate
Interest and, if applicable, any Unpaid Interest Amounts as described in
clause (i) of Section 4.01(a), to the extent unpaid from other Available
Funds;
(iii) to the Certificateholders, to pay principal as described in
clause (ii)(A) and clause (ii)(B) of Section 4.01(a), but only to the
extent necessary to maintain the Overcollateralized Amount at the
Specified Overcollateralized Amount, as a result of current or prior
Realized Losses not previously reimbursed, after giving effect to
payments and distributions from other Available Funds;
(iv) to the Certificateholders, to pay Unpaid Interest Amounts and
Basis Risk Carry Forward Amounts as described in clause (iii) of Section
4.01(a) above, to the extent unpaid from other Available Funds
(including funds on deposit in the Excess Reserve Fund Account);
(v) to the Swap Provider, any Defaulted Swap Termination Payment
owed to the Swap Provider for that Distribution Date; and
(vi) to the holders of the Class X Certificates, any remaining
amounts.
Upon termination of the Trust, any amounts remaining in the Supplemental
Interest Trust shall be distributed pursuant to the priorities set forth in
this Section 4.05.
The Securities Administrator shall account for the Supplemental Interest
Trust as an asset of a grantor trust under subpart E, Part I of subchapter J
of the Code and not as an asset of any Trust REMIC created pursuant to this
Agreement. The beneficial owners of the Supplemental Interest Trust are the
Class X Certificateholders. For federal income tax purposes, Net Swap Payment
Amounts and Swap Termination Payments payable to the Swap Provider shall be
deemed to be paid to the Supplemental Interest Trust first, by the Holder of
the Class X Certificates and second, other than any Defaulted Swap Termination
Payment, from the Upper-Tier REMIC by the Holders of the applicable Class or
Classes of LIBOR Certificates as and to the extent provided in Section 8.14.
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Any Tax Basis Risk Carry Forward Amounts distributed by the
Securities Administrator to the LIBOR Certificateholders shall be accounted
for by the Securities Administrator, for federal income tax purposes, as
amounts paid first to the Holders of the Class X Certificates and (to the
extent remaining after payments to the Swap Provider) then to the respective
Class or Classes of LIBOR Certificates. In addition, the Securities
Administrator shall account for the rights of Holders of each Class of LIBOR
Certificates to receive payments of Tax Basis Risk Carry Forward Amounts from
the Supplemental Interest Trust (along with Tax Basis Risk Carry Forward
Amounts payable from the Excess Reserve Fund Account) as rights in a separate
limited recourse interest rate cap contract written by the Class X
Certificateholders in favor of Holders of each such Class.
The Supplemental Interest Trust shall be an "outside reserve fund"
for federal income tax purposes and will not be an asset of any Trust REMIC.
Furthermore, the Holders of the Class X Certificates shall be the beneficial
owners of the Supplemental Interest Trust for all federal income tax purposes,
and shall be taxable on all income earned thereon.
Section 4.06 Trust's Obligations under the Interest Rate Swap
Agreement; Replacement and Termination of the Interest Rate Swap Agreement.
(a) Upon the Securities Administrator obtaining actual knowledge of
the rating of the Swap Provider falling below the Required Hedge Counterparty
Rating (as defined in the Interest Rate Swap Agreement), the Securities
Administrator, acting at the written direction of the Depositor, shall attempt
to negotiate an ISDA Credit Support Annex (as defined in the Interest Rate
Swap Agreement) with the Swap Provider that meets the terms of the Interest
Rate Swap Agreement. If an ISDA Credit Support Annex is negotiated, the
Securities Administrator, acting at the written direction of the Depositor,
shall set up an account in accordance with Section 3.01(c) to hold cash or
other eligible investments pledged under such ISDA Credit Support Annex. Any
cash or other eligible investments pledged under an ISDA Credit Support Annex
shall not be part of the Distribution Account, the Excess Reserve Fund Account
or the Supplemental Interest Trust unless they are applied in accordance with
such ISDA Credit Support Annex to make a payment due to the Trust pursuant to
the Interest Rate Swap Agreement.
(b) Upon the Securities Administrator obtaining actual knowledge of
an Event of Default (as defined in the Interest Rate Swap Agreement) or
Termination Event (as defined in the Interest Rate Swap Agreement) for which
the Trust has the right to designate an Early Termination Date (as defined in
the Interest Rate Swap Agreement), the Securities Administrator will act at
the written direction of the Depositor as to whether it will designate an
Early Termination Date; provided, however, that the Securities Administrator,
on behalf of the Trust, shall provide written notice to each Rating Agency
following the Event of Default or Termination Event. Upon the termination of
the Interest Rate Swap Agreement under the circumstances contemplated by this
Section 4.06(b), the Securities Administrator, on behalf of the Trust, shall
use its reasonable best efforts to enforce the rights of the Trust and the
Trustee thereunder as may be permitted by the terms of the Interest Rate Swap
Agreement and consistent with the terms hereof, and shall apply the proceeds
of any such efforts to enter into a replacement interest rate swap agreement
with another swap provider. To the extent such replacement interest rate swap
agreement can be entered into, any termination payments received by the Trust
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in respect of the terminated interest rate swap agreement shall be used, to
the extent necessary, by the Trust for the purpose of entering into such
replacement interest rate swap agreement.
ARTICLE V
THE CERTIFICATES
Section 5.01 The Certificates. The Certificates shall be
substantially in the forms attached hereto as exhibits. The Certificates shall
be issuable in registered form, in the minimum denominations, integral
multiples in excess thereof (except that one Certificate in each Class may be
issued in a different amount) and aggregate denominations per Class set forth
in the Preliminary Statement.
The Depositor hereby directs the Securities Administrator to register
the Class X and Class P Certificates in the name of [the Depositor or its
designee]. On a date as to which the Depositor notifies the Securities
Administrator, the Depositor hereby directs the Securities Administrator to
transfer the Class X and Class P Certificates in the name of the NIM Trustee
or such other name or names as the Depositor shall request, and to deliver the
Class X and Class P Certificates to the NIM Trustee, or to such other person
or persons as the Depositor shall request.
Subject to Section 11.02 respecting the final distribution on the
Certificates, on each Distribution Date the Securities Administrator shall
make distributions to each Certificateholder of record on the preceding Record
Date either (x) by wire transfer in immediately available funds to the account
of such holder at a bank or other entity having appropriate facilities
therefor as directed by that Certificateholder by written wire instructions
provided to the Securities Administrator or (y), in the event that no wire
instructions are provided to the Securities Administrator, by check mailed by
first class mail to such Certificateholder at the address of such holder
appearing in the Certificate Register.
The Certificates shall be executed by manual or facsimile signature
on behalf of the Securities Administrator by an authorized officer.
Certificates bearing the manual or facsimile signatures of individuals who
were, at the time such signatures were affixed, authorized to sign on behalf
of the Securities Administrator shall bind the Securities Administrator,
notwithstanding that such individuals or any of them have ceased to be so
authorized prior to the authentication and delivery of any such Certificates
or did not hold such office at the date of such Certificate. No Certificate
shall be entitled to any benefit under this Agreement, or be valid for any
purpose, unless authenticated by the Securities Administrator by manual
signature, and such authentication upon any Certificate shall be conclusive
evidence, and the only evidence, that such Certificate has been duly executed
and delivered hereunder. All Certificates shall be dated the date of their
authentication. On the Closing Date, the Securities Administrator shall
authenticate the Certificates to be issued at the direction of the Depositor,
or any affiliate thereof.
Section 5.02 Certificate Register; Registration of Transfer and
Exchange of Certificates. (a) The Securities Administrator shall maintain, in
accordance with the provisions of Section 5.06, a Certificate Register for the
Trust Fund in which, subject to the provisions of subsections (b) and (c)
below and to such reasonable regulations as it may prescribe, the
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Securities Administrator shall provide for the registration of Certificates
and of transfers and exchanges of Certificates as herein provided. Upon
surrender for registration of transfer of any Certificate, the Securities
Administrator shall execute and deliver, in the name of the designated
transferee or transferees, one or more new Certificates of the same Class and
aggregate Percentage Interest.
At the option of a Certificateholder, Certificates may be exchanged
for other Certificates of the same Class in authorized denominations and
evidencing the same aggregate Percentage Interest upon surrender of the
Certificates to be exchanged at the office or agency of the Securities
Administrator. Whenever any Certificates are so surrendered for exchange, the
Securities Administrator shall execute, authenticate and deliver the
Certificates which the Certificateholder making the exchange is entitled to
receive. Every Certificate presented or surrendered for registration of
transfer or exchange shall be accompanied by a written instrument of transfer
in form satisfactory to the Securities Administrator duly executed by the
holder thereof or his attorney duly authorized in writing. In the event, the
Depositor or an Affiliate transfers the Class X Certificates, or a portion
thereof, to another Affiliate, it shall notify the Securities Administrator in
writing of the affiliated status of the transferee. The Securities
Administrator shall have no liability regarding the lack of notice with
respect thereto.
No service charge to the Certificateholders shall be made for any
registration of transfer or exchange of Certificates, but payment of a sum
sufficient to cover any tax or governmental charge that may be imposed in
connection with any transfer or exchange of Certificates may be required.
All Certificates surrendered for registration of transfer or exchange
shall be cancelled and subsequently destroyed by the Securities Administrator
in accordance with the Securities Administrator's customary procedures.
(b) No transfer of a Private Certificate shall be made unless such
transfer is made pursuant to an effective registration statement under the
Securities Act and any applicable state securities laws or is exempt from the
registration requirements under said Act and such state securities laws.
Except with respect to (i) the initial transfer of the Class X or Class P
Certificates on the Closing Date, (ii) the transfer of the Class X or Class P
Certificates to the NIM Issuer or the NIM Trustee, or (iii) a transfer of the
Class X or Class P Certificates to the Depositor or any Affiliate of the
Depositor, in the event that a transfer of a Private Certificate which is a
Physical Certificate is to be made in reliance upon an exemption from the
Securities Act and such laws, in order to assure compliance with the
Securities Act and such laws, the Certificateholder desiring to effect such
transfer shall certify to the Securities Administrator in writing the facts
surrounding the transfer in substantially the form set forth in Exhibit H (the
"Transferor Certificate") and either (i) there shall be delivered to the
Securities Administrator a letter in substantially the form of Exhibit I (the
"Rule 144A Letter") or (ii) there shall be delivered to the Securities
Administrator at the expense of the transferor an Opinion of Counsel that such
transfer may be made without registration under the Securities Act. In the
event that a transfer of a Private Certificate which is a Book-Entry
Certificate is to be made in reliance upon an exemption from the Securities
Act and such laws, in order to assure compliance with the Securities Act and
such laws, the Certificateholder desiring to effect such transfer will be
deemed to have made as of the transfer date each of the certifications set
forth in the Transferor
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Certificate in respect of such Certificate and the transferee will be deemed
to have made as of the transfer date each of the certifications set forth in
the Rule 144A Letter in respect of such Certificate, in each case as if such
Certificate were evidenced by a Physical Certificate. The Depositor shall
provide to any Holder of a Private Certificate and any prospective transferee
designated by any such Holder, information regarding the related Certificates
and the Mortgage Loans and such other information as shall be necessary to
satisfy the condition to eligibility set forth in Rule 144A(d)(4) for transfer
of any such Certificate without registration thereof under the Securities Act
pursuant to the registration exemption provided by Rule 144A. The Trustee and
the Securities Administrator shall cooperate with the Depositor in providing
the Rule 144A information referenced in the preceding sentence, including
providing to the Depositor such information regarding the Certificates, the
Mortgage Loans and other matters regarding the Trust Fund as the Depositor
shall reasonably request to meet its obligation under the preceding sentence.
Each Holder of a Private Certificate desiring to effect such transfer shall,
and does hereby agree to, indemnify the Trustee and the Depositor and each
Servicer against any liability that may result if the transfer is not so
exempt or is not made in accordance with such federal and state laws.
Except with respect to (i) the initial transfer of the Class X or
Class P Certificates on the Closing Date, (ii) the transfer of the Class X or
Class P Certificates to the NIM Issuer or the NIM Trustee or (iii) a transfer
of the Class X or Class P Certificates to the Depositor or any Affiliate of
the Depositor, no transfer of an ERISA-Restricted Certificate shall be made
unless the Securities Administrator shall have received either (i) a
representation from the transferee of such Certificate acceptable to and in
form and substance satisfactory to the Securities Administrator (in the event
such Certificate is a Private Certificate or a Residual Certificate, such
requirement is satisfied only by the Securities Administrator's receipt of a
representation letter from the transferee substantially in the form of Exhibit
G), to the effect that such transferee is not an employee benefit plan or
arrangement subject to Section 406 of ERISA, a plan subject to Section 4975 of
the Code or a plan subject to any Federal, state or local law ("Similar Law")
materially similar to the foregoing provisions of ERISA or the Code, nor a
person acting on behalf of any such plan or arrangement nor using the assets
of any such plan or arrangement to effect such transfer (each such investor a
"Plan"), (ii) in the case of an ERISA-Restricted Certificate (other than a
Residual Certificate) that has been the subject of an ERISA-Qualifying
Underwriting, a representation that the purchaser is an insurance company that
is purchasing such Certificates with funds contained in an "insurance company
general account" (as such term is defined in Section V(e) of Prohibited
Transaction Class Exemption ("PTCE") 95-60) and that the purchase and holding
of such Certificates satisfy the requirements for exemptive relief under
Sections I and III of PTCE 95-60 or (iii) in the case of any ERISA-Restricted
Certificate presented for registration in the name of an employee benefit plan
subject to Title I of ERISA, a plan or arrangement subject to Section 4975 of
the Code (or comparable provisions of any subsequent enactments), or a plan
subject to Similar Law, or a trustee of any such plan or any other person
acting on behalf of any such plan or arrangement or using such plan's or
arrangement's assets, an Opinion of Counsel satisfactory to the Securities
Administrator and the Depositor, which Opinion of Counsel shall not be an
expense of the Trustee, the Depositor, the Securities Administrator or the
Trust Fund, addressed to the Securities Administrator and the Depositor, to
the effect that the purchase and holding of such ERISA-Restricted Certificate
will not constitute or result in a non-exempt prohibited transaction within
the meaning of ERISA, Section 4975 of the Code or any Similar Law and will not
subject the Trustee, the Depositor, the
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Master Servicer, any other servicer or the Securities Administrator to any
obligation in addition to those expressly undertaken in this Agreement or to
any liability. For purposes of the preceding sentence, with respect to an
ERISA-Restricted Certificate that is not a Private Certificate or a Residual
Certificate, in the event the representation letter referred to in the
preceding sentence is not furnished, such representation shall be deemed to
have been made to the Securities Administrator by the transferee's (including
an initial acquirer's) acceptance of the ERISA-Restricted Certificates. In the
event that such representation is violated, or any attempt is made to transfer
to a plan or arrangement subject to Section 406 of ERISA, a plan subject to
Section 4975 of the Code or a plan subject to Similar Law, or a person acting
on behalf of any such plan or arrangement or using the assets of any such plan
or arrangement, without such Opinion of Counsel, such attempted transfer or
acquisition shall be void and of no effect.
During the period the Supplemental Interest Trust is in effect, no
transfer of a Certificate shall be made unless the Securities Administrator
shall have received either a representation from the transferee of such
Certificate acceptable to and in form and substance satisfactory to the
Securities Administrator to the effect that such transferee is not a Plan, or
(ii) a representation that the purchase and holding of the Certificate satisfy
the requirements for exemptive relief under ▇▇▇▇ ▇▇-▇▇, ▇▇▇▇ ▇▇-▇, ▇▇▇▇ ▇▇-▇▇,
▇▇▇▇ ▇▇-▇▇, ▇▇▇▇ 96-23 or a similar exemption, or in the case of a Plan
subject to Similar Law, will not constitute a non-exempt violation of such
Similar Law. In the event such a representation letter is not delivered, one
of the foregoing representations, as appropriate, shall be deemed to have been
made by the transferee's (including an initial acquirer's) acceptance of the
Certificate. In the event that such representation is violated, such transfer
or acquisition shall be void and of no effect. The Residual Certificates may
not be sold to any employee benefit plan subject to Title I of ERISA, any plan
subject to Section 4975 of the Code, or any plan subject to any Similar Law or
any person investing on behalf of or with plan assets of such plan.
The Securities Administrator shall have no duty to monitor transfers
of beneficial interests in any Book-Entry Certificate and shall not be under
liability to any Person for any registration of transfer of any ERISA
Restricted Certificate that is in fact not permitted by this Section 5.02(b)
or for making any payments due on such Certificate to the Holder thereof or
taking any other action with respect to such Holder under the provisions of
this Agreement so long as the transfer was registered by the Securities
Administrator in accordance with the foregoing requirements.
(c) Each Person who has or who acquires any Ownership Interest in a
Residual Certificate shall be deemed by the acceptance or acquisition of such
Ownership Interest to have agreed to be bound by the following provisions, and
the rights of each Person acquiring any Ownership Interest in a Residual
Certificate are expressly subject to the following provisions:
(i) Each Person holding or acquiring any Ownership Interest in a
Residual Certificate shall be a Permitted Transferee and shall promptly
notify the Securities Administrator of any change or impending change in
its status as a Permitted Transferee;
(ii) No Ownership Interest in a Residual Certificate may be
registered on the Closing Date or thereafter transferred, and the
Securities Administrator shall not register
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the Transfer of any Residual Certificate unless, in addition to the
certificates required to be delivered to the Securities Administrator
under subparagraph (b) above, the Securities Administrator shall have
been furnished with an affidavit (a "Transfer Affidavit") of the initial
owner or the proposed transferee in the form attached hereto as Exhibit
I;
(iii) Each Person holding or acquiring any Ownership Interest in a
Residual Certificate shall agree (A) to obtain a Transfer Affidavit from
any other Person to whom such Person attempts to Transfer its Ownership
Interest in a Residual Certificate, (B) to obtain a Transfer Affidavit
from any Person for whom such Person is acting as nominee, trustee or
agent in connection with any Transfer of a Residual Certificate and (C)
not to Transfer its Ownership Interest in a Residual Certificate or to
cause the Transfer of an Ownership Interest in a Residual Certificate to
any other Person if it has actual knowledge that such Person is not a
Permitted Transferee;
(iv) Any attempted or purported Transfer of any Ownership Interest
in a Residual Certificate in violation of the provisions of this Section
5.02(c) shall be absolutely null and void and shall vest no rights in the
purported Transferee. If any purported transferee shall become a Holder
of a Residual Certificate in violation of the provisions of this Section
5.02(c), then the last preceding Permitted Transferee shall be restored
to all rights as Holder thereof retroactive to the date of registration
of Transfer of such Residual Certificate. Neither the Securities
Administrator nor the Trustee shall have any liability to any Person for
any registration of Transfer of a Residual Certificate that is in fact
not permitted by Section 5.02(b) and this Section 5.02(c) or for making
any payments due on such Certificate to the Holder thereof or taking any
other action with respect to such Holder under the provisions of this
Agreement. The Securities Administrator shall be entitled but not
obligated to recover from any Holder of a Residual Certificate that was
in fact not a Permitted Transferee at the time it became a Holder or, at
such subsequent time as it became other than a Permitted Transferee, all
payments made on such Residual Certificate at and after either such time.
Any such payments so recovered by the Securities Administrator shall be
paid and delivered by the Securities Administrator to the last preceding
Permitted Transferee of such Certificate; and
(v) The Depositor shall use its best efforts to make available, upon
receipt of written request from the Securities Administrator, all
information necessary to compute any tax imposed under Section 860E(e) of
the Code as a result of a Transfer of an Ownership Interest in a Residual
Certificate to any Holder who is not a Permitted Transferee.
The restrictions on Transfers of a Residual Certificate set forth in
this Section 5.02(c) shall cease to apply (and the applicable portions of the
legend on a Residual Certificate may be deleted) with respect to Transfers
occurring after delivery to the Securities Administrator of an Opinion of
Counsel, which Opinion of Counsel shall not be an expense of the Trust Fund,
the Trustee, or the Securities Administrator, to the effect that the
elimination of such restrictions will not cause any Trust REMIC to fail to
qualify as a REMIC at any time that the Certificates are outstanding or result
in the imposition of any tax on the Trust Fund, a Certificateholder or another
Person. Each Person holding or acquiring any Ownership Interest in a Residual
Certificate hereby consents to any amendment of this Agreement which, based on
an Opinion of
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Counsel furnished to the Securities Administrator, is reasonably necessary (a)
to ensure that the record ownership of, or any beneficial interest in, a
Residual Certificate is not transferred, directly or indirectly, to a Person
that is not a Permitted Transferee and (b) to provide for a means to compel
the Transfer of a Residual Certificate which is held by a Person that is not a
Permitted Transferee to a Holder that is a Permitted Transferee.
(d) The preparation and delivery of all certificates and opinions
referred to above in this Section 5.02 in connection with transfer shall be at
the expense of the parties to such transfers.
(e) Except as provided below, the Book-Entry Certificates shall at
all times remain registered in the name of the Depository or its nominee and
at all times: (i) registration of the Certificates may not be transferred by
the Securities Administrator except to another Depository; (ii) the Depository
shall maintain book entry records with respect to the Certificate Owners and
with respect to ownership and transfers of such Book-Entry Certificates; (iii)
ownership and transfers of registration of the Book-Entry Certificates on the
books of the Depository shall be governed by applicable rules established by
the Depository; (iv) the Depository may collect its usual and customary fees,
charges and expenses from its Depository Participants; (v) the Trustee and the
Securities Administrator shall deal with the Depository, Depository
Participants and indirect participating firms as representatives of the
Certificate Owners of the Book-Entry Certificates for purposes of exercising
the rights of holders under this Agreement, and requests and directions for
and votes of such representatives shall not be deemed to be inconsistent if
they are made with respect to different Certificate Owners; and (vi) the
Securities Administrator and the Trustee may rely and shall be fully protected
in relying upon information furnished by the Depository with respect to its
Depository Participants and furnished by the Depository Participants with
respect to indirect participating firms and persons shown on the books of such
indirect participating firms as direct or indirect Certificate Owners.
All transfers by Certificate Owners of Book-Entry Certificates shall
be made in accordance with the procedures established by the Depository
Participant or brokerage firm representing such Certificate Owner. Each
Depository Participant shall only transfer Book-Entry Certificates of
Certificate Owners it represents or of brokerage firms for which it acts as
agent in accordance with the Depository's normal procedures.
If (x) (i) the Depository or the Depositor advises the Securities
Administrator in writing that the Depository is no longer willing or able to
properly discharge its responsibilities as Depository, and (ii) the Securities
Administrator or the Depositor is unable to locate a qualified successor, or
(y) the Depositor notifies the Depository of its intent to terminate the book
entry system through the Depository, the Depository Participants holding
beneficial interests in the Book-Entry Certificates agree to initiate such
termination, the Securities Administrator shall notify all Certificate Owners,
through the Depository, of the occurrence of any such event and of the
availability of definitive, fully registered Certificates (the "Definitive
Certificates") to Certificate Owners requesting the same. Upon surrender to
the Securities Administrator of the related Class of Certificates by the
Depository, accompanied by the instructions from the Depository for
registration, the Securities Administrator shall issue the Definitive
Certificates. Neither the Depositor nor the Securities Administrator shall be
liable for any delay in delivery of such instruction and each may conclusively
rely on, and shall be
76
protected in relying on, such instructions. The Depositor shall provide the
Securities Administrator with an adequate inventory of Certificates to
facilitate the issuance and transfer of Definitive Certificates. Upon the
issuance of Definitive Certificates all references herein to obligations
imposed upon or to be performed by the Depository shall be deemed to be
imposed upon and performed by the Securities Administrator, to the extent
applicable with respect to such Definitive Certificates and the Securities
Administrator shall recognize the Holders of the Definitive Certificates as
Certificateholders hereunder; provided, that the Securities Administrator
shall not by virtue of its assumption of such obligations become liable to any
party for any act or failure to act of the Depository.
(f) Each Private Certificate presented or surrendered for
registration of transfer or exchange shall be accompanied by a written
instrument of transfer and accompanied by IRS Form W-8ECI, W-8BEN, W-8IMY (and
all appropriate attachments) or W-9 in form satisfactory to the Securities
Administrator, duly executed by the Certificateholder or his attorney duly
authorized in writing. Each Certificate presented or surrendered for
registration of transfer or exchange shall be canceled and subsequently
disposed of by the Securities Administrator in accordance with its customary
practice. No service charge shall be made for any registration of transfer or
exchange of Private Certificates, but the Securities Administrator may require
payment of a sum sufficient to cover any tax or governmental charge that may
be imposed in connection with any transfer or exchange of Private
Certificates.
Section 5.03 Mutilated, Destroyed, Lost or Stolen Certificates. If
(a) any mutilated Certificate is surrendered to the Securities Administrator,
or the Securities Administrator receives evidence to its satisfaction of the
destruction, loss or theft of any Certificate and (b) there is delivered to
the Depositor, the Trustee and the Securities Administrator such security or
indemnity as may be required by them to hold each of them harmless, then, in
the absence of notice to the Securities Administrator that such Certificate
has been acquired by a protected purchaser, the Securities Administrator shall
execute, authenticate and deliver, in exchange for or in lieu of any such
mutilated, destroyed, lost or stolen Certificate, a new Certificate of like
Class, tenor and Percentage Interest. In connection with the issuance of any
new Certificate under this Section 5.03, the Securities Administrator 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 Securities Administrator) connected
therewith. Any replacement Certificate issued pursuant to this Section 5.03
shall constitute complete and indefeasible evidence of ownership, as if
originally issued, whether or not the lost, stolen or destroyed Certificate
shall be found at any time.
Section 5.04 Persons Deemed Owners. The Trustee, the Depositor, the
Securities Administrator and any agent of the Depositor, the Securities
Administrator or the Trustee may treat the Person in whose name any
Certificate is registered as the owner of such Certificate for the purpose of
receiving distributions as provided in this Agreement and for all other
purposes whatsoever, and none of the Trustee, the Securities Administrator,
the Depositor or any agent of the Depositor, the Securities Administrator or
the Trustee shall be affected by any notice to the contrary.
Section 5.05 Access to List of Certificateholders' Names and
Addresses. If three or more Certificateholders (a) request such information in
writing from the Securities
77
Administrator, (b) state that such Certificateholders desire to communicate
with other Certificateholders with respect to their rights under this
Agreement or under the Certificates, and (c) provide a copy of the
communication which such Certificateholders propose to transmit, or if the
Depositor or a Servicer shall request such information in writing from the
Securities Administrator, then the Securities Administrator shall, within ten
(10) Business Days after the receipt of such request, provide the Depositor,
such Servicer or such Certificateholders at such recipients' expense the most
recent list of the Certificateholders of such Trust Fund held by the
Securities Administrator, if any. The Depositor and every Certificateholder,
by receiving and holding a Certificate, agree that the Securities
Administrator shall not be held accountable by reason of the disclosure of any
such information as to the list of the Certificateholders hereunder,
regardless of the source from which such information was derived.
Section 5.06 Maintenance of Office or Agency. The Securities
Administrator will maintain or cause to be maintained at its expense an office
or agency or agencies where Certificates may be surrendered for registration
of transfer or exchange. The Securities Administrator initially designates its
Corporate Trust Office for such purposes. The Securities Administrator will
give prompt written notice to the Certificateholders of any change in such
location of any such office or agency.
ARTICLE VI
THE DEPOSITOR
Section 6.01 Liabilities of the Depositor. The Depositor shall be
liable in accordance herewith only to the extent of the obligations
specifically and respectively imposed upon and undertaken by it herein.
Section 6.02 Merger or Consolidation of the Depositor. The Depositor
will keep in full effect its existence, rights and franchises as a corporation
or federally chartered savings bank, as the case may be, under the laws of the
United States or under the laws of one of the states thereof and will each
obtain and preserve its qualification to do business as a foreign corporation
in each jurisdiction in which such qualification is or shall be necessary to
protect the validity and enforceability of this Agreement, or any of the
Mortgage Loans and to perform its respective duties under this Agreement.
Any Person into which the Depositor may be merged or consolidated, or
any Person resulting from any merger or consolidation to which the Depositor
shall be a party, or any person succeeding to the business of the Depositor,
shall be the successor of the Depositor, as the case may be, hereunder,
without the execution or filing of any paper or any further act on the part of
any of the parties hereto, anything herein to the contrary notwithstanding.
Section 6.03 Limitation on Liability of the Depositor and Others.
Neither the Depositor nor any of its directors, officers, employees or agents
shall be under any liability to the Certificateholders for any action taken or
for refraining from the taking of any action in good faith pursuant to this
Agreement, or for errors in judgment; provided, however, that this provision
shall not protect the Depositor or any such Person against any breach of
representations or warranties made by it herein or protect the Depositor or
any such Person from
78
any liability which would otherwise be imposed by reasons of willful
misfeasance, bad faith or gross negligence in the performance of duties or by
reason of reckless disregard of obligations and duties hereunder. The
Depositor and any director, officer, employee or agent of the Depositor may
rely in good faith on any document of any kind prima facie properly executed
and submitted by any Person respecting any matters arising hereunder. The
Depositor and any director, officer, employee or agent of the Depositor shall
be indemnified by the Trust Fund and held harmless against any loss, liability
or expense incurred in connection with any audit, controversy or judicial
proceeding relating to a governmental taxing authority or any legal action
relating to this Agreement or the Certificates, other than any loss, liability
or expense incurred by reason of willful misfeasance, bad faith or gross
negligence in the performance of duties hereunder or by reason of reckless
disregard of obligations and duties hereunder. The Depositor shall not be
under any obligation to appear in, prosecute or defend any legal action that
is not incidental to its respective duties hereunder and which in its opinion
may involve it in any expense or liability; provided, however, that the
Depositor may in its discretion undertake any such action (or direct the
Trustee to undertake such actions for the benefit of the Certificateholders)
that it may deem necessary or desirable in respect of this Agreement and the
rights and duties of the parties hereto and interests of the Trustee and the
Certificateholders hereunder. In such event, the legal expenses and costs of
such action and any liability resulting therefrom shall be expenses, costs and
liabilities of the Trust Fund and the Depositor (or the Trustee to the extent
it has been directed by the Depositor to undertake such actions) shall be
entitled to be reimbursed therefor out of the Distribution Account.
Section 6.04 Servicing Compliance Review. Promptly upon receipt from
each Servicer of its annual statement of compliance and accountant's report
described in the applicable Step 2 Assignment Agreement the Master Servicer
shall furnish a copy thereof to the Depositor. Promptly after the Depositor's
receipt thereof, the Depositor shall review the same and, if applicable,
consult with such Servicer as to the nature of any defaults by such Servicer
in the fulfillment of any of its Servicer's obligations under the applicable
Servicing Agreement.
Section 6.05 Option to Purchase Defaulted Mortgage Loans. The
Depositor shall have the option, but is not obligated, to purchase from the
Trust any Mortgage Loan that is ninety (90) days or more delinquent. The
purchase price therefor shall be 100% of the unpaid principal balance of such
Mortgage Loan, plus all related accrued and unpaid interest, and the amount of
any unreimbursed Servicing Advances made by the Servicers or the Master
Servicer related to the Mortgage Loan.
ARTICLE VII
SERVICER DEFAULT
Section 7.01 Events of Default. If an Event of Default described in
any Servicing Agreement shall occur with respect to the related Servicer then,
and in each and every such case, so long as such Event of Default shall not
have been remedied, the Master Servicer may, or at the direction of
Certificateholders entitled to a majority of the Voting Rights the Master
Servicer shall, by notice in writing to the applicable Servicer (with a copy
to each Rating Agency), terminate all of the rights and obligations of such
Servicer under the applicable Servicing Agreement and in and to the Mortgage
Loans and the proceeds thereof. The Holders
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of Certificates evidencing at least 66% of the Voting Rights of Certificates
affected by a Event of Default may waive such Event of Default; provided,
however, that (a) an Event of Default with respect to any Servicer's
obligation to make Monthly Advances may be waived only by all of the holders
of the Certificates affected by such Event of Default and (b) no such waiver
is permitted that would materially adversely affect any non consenting
Certificateholder. On and after the receipt by such Servicer of such written
notice of termination, all authority and power of such Servicer hereunder or
under the applicable Servicing Agreement, whether with respect to the Mortgage
Loans or otherwise, shall pass to and be vested in the Master Servicer. The
Master Servicer is hereby authorized and empowered to execute and deliver, on
behalf of such Servicer, as attorney-in-fact or otherwise, any and all
documents and other instruments, and to do or accomplish all other acts or
things necessary or appropriate to effect the purposes of such notice of
termination, whether to complete the transfer and endorsement or assignment of
the Mortgage Loans and related documents, or otherwise.
Section 7.02 Master Servicer to Act; Appointment of Successor. Within
120 days after the Master Servicer gives, and the applicable Servicer receives
a notice of termination pursuant to Section 7.01, the Master Servicer shall,
subject to and to the extent provided in Section 7.03, and subject to the
rights of the Master Servicer to appoint a successor Servicer pursuant to this
Section 7.02, be the successor to the Servicer in its capacity as servicer
under the applicable Servicing Agreement and the transactions set forth or
provided for herein and in such Servicing Agreement and shall be subject to
all the responsibilities, duties and liabilities relating thereto placed on
the Servicer by the terms and provisions of such Servicing Agreement and
applicable law including the obligation to make Monthly Advances or Servicing
Advances pursuant to such Servicing Agreement (it being understood and agreed
that if any Servicer fails to make an Advance, the Master Servicer shall do so
unless a determination has been made that such Advance would constitute a
Nonrecoverable Monthly Advance or a Nonrecoverable Servicing Advance). As
compensation therefor, the Master Servicer shall be entitled to all funds
relating to the Mortgage Loans that the Servicer would have been entitled to
charge to the Collection Account if the Servicer had continued to act under
the Servicing Agreement including, if the Servicer was receiving the Servicing
Fee at the Servicing Fee Rate set forth in the Servicing Agreement (as set
forth in the Mortgage Loan Schedule with respect to the related Group I
Mortgage Loans and Group II Mortgage Loans, respectively) such Servicing Fee
and the income on investments or gain related to the Collection Account.
Notwithstanding the foregoing, the Master Servicer may, if it shall
be unwilling to so act, or shall, if it is prohibited by applicable law from
making Monthly Advances and Servicing Advances pursuant to the applicable
Servicing Agreement, or if it is otherwise unable to so act, or, at the
written request of Certificateholders entitled to a majority of the Voting
Rights, appoint, or petition a court of competent jurisdiction to appoint, any
established mortgage loan servicing institution the appointment of which does
not adversely affect the then current rating of the Certificates by each
Rating Agency, as the successor to such Servicer under the applicable
Servicing Agreement in the assumption of all or any part of the
responsibilities, duties or liabilities of such Servicer. No such appointment
of a successor to a Servicer hereunder shall be effective until the Depositor
shall have consented thereto. Any successor to such Servicer shall be an
institution which is a ▇▇▇▇▇▇ ▇▇▇ and ▇▇▇▇▇▇▇ Mac approved seller/servicer in
good standing, which has a net worth of at least $25,000,000, which is willing
to service the Mortgage Loans and which executes and delivers to the Depositor
and the Master Servicer an agreement
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accepting such delegation and assignment, containing an assumption by such
Person of the rights, powers, duties, responsibilities, obligations and
liabilities of such terminated Servicer, (other than liabilities of such
terminated Servicer incurred prior to termination of such Servicer under
Section 7.01), with like effect as if originally named as a party to this
Agreement; provided, that each Rating Agency acknowledges that its rating of
the Certificates in effect immediately prior to such assignment and delegation
will not be qualified or reduced, as a result of such assignment and
delegation. Pending appointment of a successor to a Servicer hereunder, the
Master Servicer, unless the Master Servicer is prohibited by law from so
acting, shall, subject to this Section 7.02, act in such capacity as
hereinabove provided. In connection with such appointment and assumption, the
Master Servicer may make such arrangements for the compensation of such
successor out of payments on Mortgage Loans as it, the Depositor and such
successor shall agree; provided, however, that no such compensation shall be
in excess of the Servicing Fee Rate and amounts paid to the Servicer from
investments. The Master Servicer and such successor shall take such action,
consistent with this Agreement, as shall be necessary to effectuate any such
succession. Neither the Master Servicer nor any other successor to a Servicer
shall be deemed to be in default hereunder by reason of any failure to make,
or any delay in making, any distribution hereunder or any portion thereof or
any failure to perform, or any delay in performing, any duties or
responsibilities hereunder, in either case caused by the failure of the
predecessor Servicer to deliver or provide, or any delay in delivering or
providing, any cash, information, documents or records to it.
Any successor Servicer shall give notice to the Mortgagors of such
change of Servicer, in accordance with applicable federal and state law, and
shall, during the term of its service as servicer, maintain in force the
policy or policies that each Servicer is required to maintain pursuant to the
applicable Servicing Agreement.
Notwithstanding the foregoing, the Master Servicer may not terminate
a Servicer without cause.
Section 7.03 Master Servicer to Act as Servicer. In the event that a
Servicer shall for any other reason no longer be the Servicer, the Master
Servicer or another successor Servicer, shall thereupon assume all of the
rights and obligations of the predecessor Servicer hereunder arising
thereafter pursuant to Section 7.02.
Section 7.04 Notification to Certificateholders. (a) Upon any
termination of or appointment of a successor to a Servicer, the Securities
Administrator shall give prompt written notice thereof to Certificateholders
and to each Rating Agency.
(b) Promptly after the occurrence of any Event of Default, the
Securities Administrator shall transmit by mail to all Certificateholders and
each Rating Agency notice of each such Event of Default hereunder known to the
Securities Administrator, unless such Event of Default shall have been cured
or waived.
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ARTICLE VIII
CONCERNING THE TRUSTEE AND THE CUSTODIANS
Section 8.01 Duties of the Trustee and the Custodians. The Trustee,
before the occurrence of a Master Servicer Event of Default and after the
curing of all Master Servicer Events of Default that may have occurred, shall
undertake to perform such duties and only such duties as are specifically set
forth in this Agreement. In case a Master Servicer Event of Default has
occurred and remains uncured, the Trustee shall exercise such of the rights
and powers vested in it by this Agreement, and use the same degree of care and
skill in their exercise as a prudent person would exercise or use under the
circumstances in the conduct of such person's own affairs.
The Trustee and the Custodians, upon receipt of all resolutions,
certificates, statements, opinions, reports, documents, orders or other
instruments furnished to the Trustee or the Custodians, as applicable, that
are specifically required to be furnished pursuant to any provision of this
Agreement shall examine them to determine whether on their face they are in
the form required by this Agreement, or with respect to the documents in the
respective Custodial Files whether they satisfy the review criteria set forth
in Section 2.02. Neither the Trustee nor the Custodians shall be responsible
for the accuracy or content of any resolution, certificate, statement,
opinion, report, document, order, or other instrument.
No provision of this Agreement shall be construed to relieve the
Trustee or the Custodians from liability for its own negligent action, its own
negligent failure to act or its own bad faith or willful misfeasance;
provided, however, that:
(a) unless a Master Servicer Event of Default of which a Responsible
Officer of the Trustee obtains actual knowledge has occurred and is
continuing, the duties and obligations of the Trustee shall be determined
solely by the express provisions of this Agreement, the Trustee shall not be
liable except for the performance of the duties and obligations specifically
set forth in this Agreement, no implied covenants or obligations shall be read
into this Agreement against the Trustee, and the Trustee may conclusively
rely, as to the truth of the statements and the correctness of the opinions
expressed therein, upon any certificates or opinions furnished to the Trustee
and conforming to the requirements of this Agreement which it believed in good
faith to be genuine and to have been duly executed by the proper authorities
respecting any matters arising hereunder;
(b) the Trustee shall not be liable for an error of judgment made in
good faith by a Responsible Officer or Responsible Officers of the Trustee,
unless it is finally proven that the Trustee was negligent in ascertaining the
pertinent facts; and
(c) the Trustee shall not be liable with respect to any action taken,
suffered, or omitted to be taken by it in good faith in accordance with the
direction of the Holders of Certificates evidencing not less than 25% of the
Voting Rights of Certificates relating to the time, method, and place of
conducting any proceeding for any remedy available to the Trustee, or
exercising any trust or power conferred upon the Trustee under this Agreement.
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Section 8.02 [Reserved].
Section 8.03 Certain Matters Affecting the Trustee and the
Custodians. Except as otherwise provided in Section 8.01:
(a) the Trustee and the Custodians may request and rely upon and
shall be protected in acting or refraining from acting upon any resolution,
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 Custodians shall have no responsibility to ascertain
or confirm the genuineness of any signature of any such party or parties;
(b) before taking any action under this Agreement, the Trustee and
the Custodians may consult with counsel, financial advisers or accountants and
the advice of any such counsel, financial advisers or accountants and any
Opinion of Counsel shall be full and complete authorization and protection in
respect of any action taken or suffered or omitted by it hereunder in good
faith and in accordance with such advice or Opinion of Counsel;
(c) the Trustee and the Custodians shall not be liable for any action
taken, suffered or omitted by it in good faith and believed by it to be
authorized or within the discretion or rights or powers conferred upon it by
this Agreement;
(d) the Trustee shall not be bound to make any investigation into the
facts or matters stated in any resolution, certificate, statement, instrument,
opinion, report, notice, request, consent, order, approval, bond or other
paper or document, unless requested in writing so to do by Holders of
Certificates evidencing not less than 25% of the Voting Rights allocated to
each Class of Certificates; provided, however, that if the payment within a
reasonable time to the Trustee of the costs, expenses or liabilities likely to
be incurred by it in the making of such investigation is, in the opinion of
the Trustee, not assured to the Trustee by the security afforded to it by the
terms of this Agreement, the Trustee may require indemnity satisfactory to the
Trustee against such cost, expense or liability as a condition to taking any
such action. The reasonable expense of every such examination shall be paid by
the applicable Servicer or, if paid by the Trustee, shall be repaid by the
Servicer upon demand from the applicable Servicer's own funds;
(e) the Trustee may execute any of the trusts or powers hereunder or
perform any duties hereunder either directly or by or through agents,
accountants or attorneys and the Trustee shall not be responsible for any
misconduct or negligence on the part of any agents, accountants or attorneys
appointed with due care by it hereunder;
(f) neither the Trustee nor the Custodians shall be required to risk
or expend its own funds or otherwise incur any financial liability in the
performance of any of its duties or in the exercise of any of its rights or
powers hereunder if it shall have reasonable grounds for believing that
repayment of such funds or indemnity satisfactory to it against such risk or
liability is not assured to it;
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(g) the Trustee shall not be liable for any loss on any investment of
funds pursuant to this Agreement (other than as issuer of the investment
security);
(h) unless a Responsible Officer of the Trustee has actual knowledge
of the occurrence of a Master Servicer Event of Default or an Event of
Default, the Trustee shall not be deemed to have knowledge of a Master
Servicer Event of Default or an Event of Default, until a Responsible Officer
of the Trustee shall have received written notice thereof;
(i) the Trustee shall be under no obligation to exercise any of the
trusts, rights or powers vested in it by this Agreement or to institute,
conduct or defend any litigation hereunder or in relation hereto at the
request, order or direction of any of the Certificateholders, pursuant to this
Agreement, unless such Certificateholders shall have offered to the Trustee
reasonable security or indemnity satisfactory to the Trustee against the
costs, expenses and liabilities which may be incurred therein or thereby;
(j) the right of the Trustee to perform any discretionary act
enumerated in this Agreement shall not be construed as a duty, and the Trustee
shall not be answerable for other than its negligence or willful misconduct in
the performance of such act;
(k) the Trustee shall not be required to give any bond or surety in
respect of the execution of the Trust Fund created hereby or the powers
granted hereunder;
(l) notwithstanding anything to the contrary in any Servicing
Agreement, the Trustee shall not consent to a Servicer's request of assigning
the Servicing Agreement or the servicing rights thereunder to any other party;
(m) the Trustee and the Custodians shall not be accountable and shall
have no liability for any acts or omissions by the Securities Administrator,
the Master Servicer or other party hereto;
(n) in no event shall U.S. Bank, in its capacity as Trustee and as a
Custodian hereunder, BNY, as a Custodian hereunder, Deutsche Bank, as a
Custodian hereunder or any other Custodian hereunder, be liable for special,
indirect or consequential damages; and
(o) the Securities Administrator is authorized and directed to
execute the Interest Rate Swap Agreement.
Section 8.04 Trustee and Custodians Not Liable for Certificates or
Mortgage Loans. The recitals contained herein and in the Certificates shall be
taken as the statements of the Depositor and neither the Trustee nor the
Custodians assumes any responsibility for their correctness. The Trustee and
the Custodians make no representations as to the validity or sufficiency of
this Agreement or of the Certificates or of any Mortgage Loan or related
document. Neither the Trustee nor the Custodians shall be accountable for the
use or application by the Depositor, the Master Servicer, any Servicer or the
Securities Administrator of any funds paid to the Depositor, the Master
Servicer, any Servicer or the Securities Administrator in respect of the
Mortgage Loans or deposited in or withdrawn from the Collection Account or the
Distribution Account by the Depositor, the Master Servicer, any Servicer, or
the Securities Administrator.
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The Trustee shall have no responsibility (i) for filing or recording
any financing or continuation statement in any public office at any time or to
otherwise perfect or maintain the perfection of any security interest or lien
granted to it hereunder (unless the Trustee shall have become and remains the
successor Master Servicer), (ii) to see to any insurance (unless the Trustee
shall have become the successor Master Servicer) or (iii) to confirm or verify
the contents of any reports or certificates of the Servicers, Securities
Administrator or Master Servicer 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.
The Securities Administrator executes the Certificates not in its
individual capacity but solely as Securities Administrator of the Trust Fund
created by this Agreement, in the exercise of the powers and authority
conferred and vested in it by this Agreement. Each of the undertakings and
agreements made on the part of the Securities Administrator on behalf of the
Trust Fund in the Certificates is made and intended not as a personal
undertaking or agreement by the Securities Administrator but is made and
intended for the purpose of binding only the Trust Fund.
Section 8.05 Trustee May Own Certificates. The Trustee in its
individual or any other capacity may become the owner or pledgee of
Certificates with the same rights as it would have if it were not the Trustee.
Section 8.06 Trustee's Fees and Expenses. As compensation for its
activities under this Agreement, the Trustee shall be paid an on-going monthly
or annual fee, as applicable, by the Securities Administrator pursuant to a
separate agreement. The Trustee shall have no lien on the Trust Fund for the
payment of such fees. The Trustee shall be entitled to be reimbursed, from
funds on deposit in the Distribution Account, amounts sufficient to indemnify
and hold harmless the Trustee and any director, officer, employee, or agent of
the Trustee against any loss, liability, or expense (including reasonable
attorneys' fees) incurred:
(i) in connection with any claim or legal action relating to:
(a) this Agreement; or
(b) the Mortgage Loans or the Certificates; and
(ii) the performance of any of the Trustee's duties under this
Agreement; or
(iii) incurred by reason of any action of the Trustee taken at the
direction of the Certificateholders;
other than, in each case, any loss, liability, or expense (i) resulting from
any breach of any Servicer's obligations in connection with its Servicing
Agreement for which that Servicer has performed its obligation to indemnify
the Trustee pursuant to Servicing Agreement, (ii) resulting from any breach of
the Responsible Party's obligations in connection with any Sale Agreement for
which it has performed its obligation to indemnify the Trustee pursuant to the
Sale Agreement, (iii) resulting from any breach of the Master Servicer's
obligations hereunder for which the Master Servicer has performed its
obligation to indemnify the Trustee pursuant to this Agreement or (iv)
incurred because of willful misfeasance, bad faith, or negligence in the
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performance of any of the Trustee's duties under this Agreement. This
indemnity shall survive the termination of this Agreement or the resignation
or removal of the Trustee under this Agreement. Without limiting the
foregoing, except for any expense, disbursement, or advance arising from the
Trustee's negligence, bad faith, or willful misfeasance, the Trust Fund shall
pay or reimburse the Trustee, for all reasonable expenses, disbursements, and
advances incurred or made by the Trustee in accordance with this Agreement
with respect to:
(A) the reasonable compensation, expenses, and
disbursements of its counsel not associated with the closing
of the issuance of the Certificates; and
(B) the reasonable compensation, expenses, and
disbursements of any accountant, engineer, or appraiser that
is not regularly employed by the Trustee, to the extent that
the Trustee must engage them to perform services under this
Agreement.
Except as otherwise provided in this Agreement, the Trustee shall not
be entitled to payment or reimbursement for any routine ongoing expenses
incurred by the Trustee in the ordinary course of its duties as Trustee under
this Agreement or for any other expenses.
Section 8.07 Eligibility Requirements for the Trustee. The Trustee
hereunder shall at all times be a corporation, banking association or other
association organized and doing business under the laws of a state or the
United States of America, authorized under such laws to exercise corporate
trust powers, having a combined capital and surplus of at least $50,000,000,
subject to supervision or examination by federal or state authority and the
appointment of which would not cause any of the Rating Agencies to reduce or
withdraw their respective then current ratings of the Certificates (or having
provided such security from time to time as is sufficient to avoid such
reduction) as evidenced in writing by each Rating Agency. If such corporation
or association publishes reports of condition at least annually, pursuant to
law or to the requirements of the aforesaid supervising or examining
authority, then for the purposes of this Section 8.07 the combined capital and
surplus of such corporation or association shall be deemed to be its combined
capital and surplus as set forth in its most recent report of condition so
published. In case at any time the Trustee shall cease to be eligible in
accordance with this Section 8.07, the Trustee shall resign immediately in the
manner and with the effect specified in Section 8.08. The entity serving as
Trustee may have normal banking and trust relationships with the Depositor and
its affiliates or with the Servicer and its affiliates; provided, however,
that such entity cannot be an affiliate of the Depositor or of any Servicer
other than the Trustee in its role as successor to the Master Servicer.
Section 8.08 Resignation and Removal of the Trustee. The Trustee may
at any time resign and be discharged from the trusts hereby created by giving
written notice of resignation to the Depositor, the Master Servicer, the
Securities Administrator and each Rating Agency not less than sixty (60) days
before the date specified in such notice, when, subject to Section 8.09, such
resignation is to take effect, and acceptance by a successor trustee in
accordance with Section 8.09 meeting the qualifications set forth in Section
8.07. If no successor trustee meeting such qualifications shall have been so
appointed and have accepted appointment within thirty (30) days after the
giving of such notice or resignation, the resigning Trustee may petition any
court of competent jurisdiction for the appointment of a successor trustee.
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If at any time (i) the Trustee shall cease to be eligible in
accordance with Section 8.07 and shall fail to resign after written request
thereto by the Depositor, (ii) the Trustee shall become incapable of acting,
or shall be adjudged as bankrupt or insolvent, or a receiver of the Trustee or
of its property shall be appointed, or any public officer shall take charge or
control of the Trustee or of its property or affairs for the purpose of
rehabilitation, conservation or liquidation, (iii)(A) a tax is imposed with
respect to the Trust Fund by any state in which the Trustee or the Trust Fund
is located and (B) the imposition of such tax would be avoided by the
appointment of a different trustee, or (iv) the Trustee fails to comply with
its obligations under the last sentence of Section 9.04 in the preceding
paragraph, Section 8.10 or Article XIII and such failure is not remedied
within the lesser of ten (10) calendar days or such period in which the
applicable Exchange Act Report can be timely filed (without taking into
account any extensions), then, in the case of clauses (i) through (iv), the
Depositor may remove the Trustee and appoint a successor trustee by written
instrument, in duplicate, one copy of which shall be delivered to the Trustee
and one copy to the successor trustee.
The Holders of Certificates entitled to a majority of the Voting
Rights may at any time remove the Trustee and appoint a successor trustee by
written instrument or instruments, in duplicate, signed by such Holders or
their attorneys in fact duly authorized, one complete set of which shall be
delivered to the Trustee so removed and one complete set to the successor so
appointed. The successor trustee shall notify each Rating Agency of any
removal of the Trustee.
Any resignation or removal of the Trustee and appointment of a
successor trustee pursuant to this Section 8.08 shall become effective upon
acceptance of appointment by the successor trustee as provided in Section
8.09.
Section 8.09 Successor Trustee. Any successor trustee appointed as
provided in Section 8.08 shall execute, acknowledge and deliver to the
Depositor and to its predecessor trustee an instrument accepting such
appointment hereunder and thereupon the resignation or removal of the
predecessor trustee shall become effective and such successor trustee, without
any further act, deed or conveyance, shall become fully vested with all the
rights, powers, duties and obligations of its predecessor hereunder, with the
like effect as if originally named as trustee herein. The Depositor and the
predecessor trustee shall execute and deliver such instruments and do such
other things as may reasonably be required for more fully and certainly
vesting and confirming in the successor trustee all such rights, powers,
duties, and obligations.
No successor trustee shall accept appointment as provided in this
Section 8.09 unless at the time of its acceptance, the successor trustee is
eligible under Section 8.07 and its appointment does not adversely affect the
then current rating of the Certificates and has provided to the Depositor in
writing and in form and substance reasonably satisfactory to the Depositor,
all information reasonably requested by the Depositor in order to comply with
its reporting obligation under Item 6.02 of Form 8-K with respect to a
replacement Trustee.
Upon acceptance of appointment by a successor trustee as provided in
this Section 8.09, the Depositor shall mail notice of the succession of such
trustee hereunder to all Holders of Certificates and the Custodians. If the
Depositor fails to mail such notice within ten (10) days after acceptance of
appointment by the successor trustee, the successor trustee shall cause such
notice to be mailed at the expense of the Depositor.
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Section 8.10 Merger or Consolidation of the Trustee or the
Custodians. Any corporation or association into which the Trustee or the
Custodians, as applicable, may be merged or converted or with which it may be
consolidated or any corporation or association resulting from any merger,
conversion or consolidation to which the Trustee or the Custodians, as
applicable, shall be a party, or any corporation or association succeeding to
the business of the Trustee or the Custodians, as applicable, or any
corporation or association to which all or substantially all of the corporate
trust business of the Trustee or the Custodians, as applicable, may be sold or
otherwise transferred, shall be the successor of the Trustee or the
Custodians, as applicable, hereunder; provided, that such corporation or
association shall be eligible under Section 8.07 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 8.11 Appointment of Co-Trustee or Separate Trustee.
Notwithstanding any other provisions of this Agreement, at any time, for the
purpose of meeting any legal requirements of any jurisdiction in which any
part of the Trust Fund or property securing any Mortgage Note may at the time
be located, the Trustee shall have the power and shall execute and deliver all
instruments to appoint one or more Persons to act as co-trustee or co-trustees
jointly with the Trustee, or separate trustee or separate trustees, of all or
any part of the Trust Fund, and to vest in such Person or Persons, in such
capacity and for the benefit of the Certificateholders, such title to the
Trust Fund or any part thereof, whichever is applicable, and, subject to the
other provisions of this Section 8.11, such powers, duties, obligations,
rights and trusts as the Trustee may consider appropriate. No co-trustee or
separate trustee hereunder shall be required to meet the terms of eligibility
as a successor trustee under Section 8.09 and no notice to Certificateholders
of the appointment of any co-trustee or separate trustee shall be required
under Section 8.09.
Every separate trustee and co-trustee shall, to the extent permitted
by law, be appointed and act subject to the following provisions and
conditions:
(a) to the extent necessary to effectuate the purposes of this
Section 8.11, all rights, powers, duties and obligations conferred or imposed
upon the Trustee, except for the obligation of the Trustee (as successor
Master Servicer) under this Agreement to advance funds on behalf of the Master
Servicer, shall be conferred or imposed upon and exercised or performed by the
Trustee and such separate trustee or co-trustee jointly (it being understood
that such separate trustee or co-trustee is not authorized to act separately
without the Trustee joining in such act), except to the extent that under any
law of any jurisdiction in which any particular act or acts are to be
performed (whether as Trustee hereunder or as successor to 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 applicable Trust Fund or any portion
thereof in any such jurisdiction) shall be exercised and performed singly by
such separate trustee or co-trustee, but solely at the direction of the
Trustee;
(b) no trustee hereunder shall be held personally liable because of
any act or omission of any other trustee hereunder and such appointment shall
not, and shall not be deemed to, constitute any such separate trustee or
co-trustee as agent of the Trustee;
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(c) the Trustee may at any time accept the resignation of or remove
any separate trustee or co-trustee; and
(d) the Trust Fund, and not the Trustee, shall be liable for the
payment of reasonable compensation, reimbursement and indemnification to any
such separate trustee or co-trustee.
Any notice, request or other writing given to the Trustee shall be
deemed to have been given to each of the separate trustees and co-trustees,
when and as effectively as if given to each of them. Every instrument
appointing any separate trustee or co-trustee shall refer to this Agreement
and the conditions of this Article VIII. Each separate trustee and co-trustee,
upon its acceptance of the trusts conferred, shall be vested with the estates
or property specified in its instrument of appointment, either jointly with
the Trustee or separately, as may be provided therein, subject to all the
provisions of this Agreement, specifically including every provision of this
Agreement relating to the conduct of, affecting the liability of, or affording
protection to, the Trustee. Every such instrument shall be filed with the
Trustee and a copy thereof given to the Master Servicer and the Depositor.
Any separate trustee or co-trustee may, at any time, constitute the
Trustee its agent or attorney-in-fact, with full power and authority, to the
extent not prohibited by law, to do any lawful act under or in respect of this
Agreement on its behalf and in its name. If any separate trustee or co-trustee
shall die, become incapable of acting, resign or be removed, all of its
estates, properties, rights, remedies and trusts shall vest in and be
exercised by the Trustee, to the extent permitted by law, without the
appointment of a new or successor trustee.
Section 8.12 Tax Matters. It is intended that the assets with respect
to which any REMIC election pertaining to the Trust Fund is to be made, as set
forth in the Preliminary Statement, shall constitute, and that the conduct of
matters relating to such assets shall be such as to qualify such assets as, a
"real estate mortgage investment conduit" as defined in, and in accordance
with, the REMIC Provisions. In furtherance of such intention, the Securities
Administrator covenants and agrees that it shall act as agent (and the
Securities Administrator is hereby appointed to act as agent) on behalf of
each REMIC described in the Preliminary Statement and that in such capacity it
shall:
(a) prepare and file, in a timely manner, a U.S. Real Estate Mortgage
Investment Conduit (REMIC) Income Tax Return (Form 1066 or any successor form
adopted by the Internal Revenue Service) and prepare and file with the
Internal Revenue Service and applicable state or local tax authorities income
tax or information returns for each taxable year with respect to each Trust
REMIC containing such information and at the times and in the manner as may be
required by the Code or state or local tax laws, regulations, or rules, and
furnish to Certificateholders the schedules, statements or information at such
times and in such manner as may be required thereby;
(b) within thirty (30) days of the Closing Date, apply for an
employer identification number from the Internal Revenue Service via Form SS-4
or any other acceptable method for all tax entities and shall also furnish to
the Internal Revenue Service, on Form 8811 or as otherwise may be required by
the Code, the name, title, address, and telephone number of
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the person that the holders of the Certificates may contact for tax
information relating thereto, together with such additional information as may
be required by such Form, and update such information at the time or times in
the manner required by the Code;
(c) make an election that each Trust REMIC be treated as a REMIC on
the federal tax return for its first taxable year (and, if necessary, under
applicable state law);
(d) prepare and forward to the Certificateholders and to the Internal
Revenue Service and, if necessary, state tax authorities, all information
returns and reports as and when required to be provided to them in accordance
with the REMIC Provisions, including the calculation of any original issue
discount using the prepayment assumption (as described in the Prospectus
Supplement);
(e) provide information necessary for the computation of tax imposed
on the transfer of a Residual Certificate to a Person that is not a Permitted
Transferee (a "Non-Permitted Transferee"), or an agent (including a broker,
nominee or other middleman) of a Non-Permitted Transferee, or a pass through
entity in which a Non-Permitted Transferee is the record holder of an interest
(the reasonable cost of computing and furnishing such information may be
charged to the Person liable for such tax);
(f) to the extent that they are under its control, conduct matters
relating to such assets at all times that any Certificates are outstanding so
as to maintain the status of each Trust REMIC as a REMIC under the REMIC
Provisions;
(g) not knowingly or intentionally take any action or omit to take
any action that would cause the termination of the REMIC status of any Trust
REMIC created hereunder;
(h) pay, from the sources specified in the last paragraph of this
Section 8.12, the amount of any federal or state tax, including prohibited
transaction taxes as described below, imposed on any Trust REMIC before its
termination when and as the same shall be due and payable (but such obligation
shall not prevent the Securities Administrator or any other appropriate Person
from contesting any such tax in appropriate proceedings and shall not prevent
the Securities Administrator from withholding payment of such tax, if
permitted by law, pending the outcome of such proceedings);
(i) cause federal, state or local income tax or information returns
to be signed by the Securities Administrator or, if required by applicable tax
law, the Trustee or such other person as may be required to sign such returns
by the Code or state or local laws, regulations or rules;
(j) maintain records relating to each of the Trust REMICs, including
the income, expenses, assets, and liabilities thereof on a calendar year basis
and on the accrual method of accounting and the fair market value and adjusted
basis of the assets determined at such intervals as may be required by the
Code, as may be necessary to prepare the foregoing returns, schedules,
statements or information; and
(k) as and when necessary and appropriate, represent each Trust REMIC
in any administrative or judicial proceedings relating to an examination or
audit by any
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governmental taxing authority, request an administrative adjustment as to any
taxable year of each Trust REMIC, enter into settlement agreements with any
governmental taxing agency, extend any statute of limitations relating to any
tax item of any Trust REMIC, and otherwise act on behalf of each Trust REMIC
in relation to any tax matter or controversy involving it.
The Holder of the largest Percentage Interest of the Class R, Class
RC and Class RX Certificates shall act as Tax Matters Person for the
Lower-Tier REMIC and the Middle-Tier REMIC, the Upper-Tier REMIC and the Class
X REMIC, respectively, within the meaning of Treasury Regulations Section
1.860F-4(d), and the Securities Administrator is hereby designated as agent of
such Certificateholder for such purpose (or if the Securities Administrator is
not so permitted, such Holder shall be the Tax Matters Person in accordance
with the REMIC Provisions). In such capacity, the Securities Administrator
shall, as and when necessary and appropriate, represent each Trust REMIC in
any administrative or judicial proceedings relating to an examination or audit
by any governmental taxing authority, request an administrative adjustment as
to any taxable year of each Trust REMIC, enter into settlement agreements with
any governmental taxing agency, extend any statute of limitations relating to
any tax item of any Trust REMIC, and otherwise act on behalf of each Trust
REMIC in relation to any tax matter or controversy involving it.
The Securities Administrator shall treat the rights of the Class P
Certificateholders to receive Prepayment Premiums, the rights of the Class X
Certificateholders to receive amounts in the Excess Reserve Fund Account and
Supplemental Interest Trust (subject to the obligation to pay Tax Basis Risk
Carry Forward Amounts) and the rights of the LIBOR Certificateholders to
receive Tax Basis Risk Carry Forward Amounts as the beneficial ownership
interests in a grantor trust and not as an obligations of any REMIC created
hereunder, for federal income tax purposes. The Securities Administrator shall
file or cause to be filed with the Internal Revenue Service Form 1041 or such
other form as may be applicable and shall furnish or cause to be furnished, to
the Class X Certificateholders, the Class P Certificateholders and the LIBOR
Certificateholders, the respective amounts described above that are received,
in the time or times and in the manner required by the Code.
To enable the Securities Administrator to perform its duties under
this Agreement, the Depositor shall provide to the Securities Administrator
within ten (10) days after the Closing Date all information or data that the
Securities Administrator requests in writing and determines to be relevant for
tax purposes to the valuations and offering prices of the Certificates,
including the price, yield, prepayment assumption, and projected cash flows of
the Certificates and the Mortgage Loans. Moreover, the Depositor shall provide
information to the Securities Administrator concerning the value, if any, to
each Class of Certificates of the right to receive Tax Basis Risk Carry
Forward Amounts from the Excess Reserve Fund Account and the Supplemental
Interest Trust. Thereafter, the Depositor shall provide to the Securities
Administrator promptly upon written request therefor any additional
information or data that the Securities Administrator may, from time to time,
reasonably request to enable the Securities Administrator to perform its
duties under this Agreement. The Depositor hereby indemnifies the Securities
Administrator for any losses, liabilities, damages, claims, or expenses of the
Securities Administrator arising from any errors or miscalculations of the
Securities Administrator that result from any failure of the Depositor to
provide, or to cause to be provided, accurate information or data to the
Securities Administrator on a timely basis.
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If any tax is imposed on "prohibited transactions" of any Trust REMIC
as defined in Section 860F(a)(2) of the Code, on the "net income from
foreclosure property" of the Lower-Tier REMIC as defined in Section 860G(c) of
the Code, on any contribution to any Trust REMIC after the Startup Day
pursuant to Section 860G(d) of the Code, or any other tax is imposed,
including any minimum tax imposed on any Trust REMIC pursuant to Sections
23153 and 24874 of the California Revenue and Taxation Code, if not paid as
otherwise provided for herein, the tax shall be paid by (i) the Master
Servicer, the Trustee or the Securities Administrator, as applicable if such
tax arises out of or results from negligence of the Master Servicer, the
Trustee or the Securities Administrator, as applicable in the performance of
any of its obligations under this Agreement, (ii) a Servicer, in the case of
any such minimum tax, and otherwise if such tax arises out of or results from
a breach by the Servicer of any of its obligations under the applicable
Servicing Agreement, (iii) a Responsible Party if such tax arises out of or
results from the Responsible Party's obligation to repurchase a Mortgage Loan
pursuant to the applicable Sale Agreement or (iv) in all other cases, or if
the Trustee, the Master Servicer, the Securities Administrator, the Servicer
or the Responsible Party fails to honor its obligations under the preceding
clause (i), (ii), or (iii), any such tax will be paid with amounts otherwise
to be distributed to the Certificateholders, as provided in Section 4.01(a).
For as long as each Trust REMIC shall exist, the Securities
Administrator shall act as specifically required herein, and the Securities
Administrator shall comply with any directions of the Depositor or a Servicer
stating that such directions are being given to assure such continuing
treatment. In particular, the Securities Administrator shall not (a) sell or
authorize 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
purchase or repurchase of the Mortgage Loans pursuant to this Agreement or (b)
accept any contribution to any Trust REMIC after the Startup Day without
receipt of an Opinion of Counsel that such action described in clause (a) or
(b) will not result in the imposition of a tax on any Trust REMIC or cause any
Trust REMIC to fail to qualify as a REMIC at any time that any Certificates
are outstanding.
Section 8.13 [Reserved].
Section 8.14 Tax Classification of the Excess Reserve Fund Account
and the Interest Rate Swap Agreement. For federal income tax purposes, the
Securities Administrator shall treat the Excess Reserve Fund Account and the
Interest Rate Swap Agreement as beneficially owned by the holder of the Class
X Certificates and shall treat such portion of the Trust Fund as a grantor
trust under subpart E, Part I of subchapter J of the Code. The Securities
Administrator shall treat the rights that each Class of LIBOR Certificates has
to receive payments of Tax Basis Risk Carry Forward Amounts from the Excess
Reserve Fund Account and the Supplemental Interest Trust as rights to receive
payments under an interest rate cap contract written by the Class X
Certificateholders in favor of each Class. Accordingly, each Class of LIBOR
Certificates will comprise two components--a regular interest in the
Upper-Tier REMIC and an interest in an interest rate cap contract, and the
Class X Certificates will be comprised of four components--a regular interest
in the Class X REMIC, an interest in the Interest Rate Swap Agreement, the
Supplemental Interest Trust and the Excess Reserve Fund Account subject to the
obligation to pay Basis Risk ▇▇▇▇ Forward Amounts, Net Swap Payment Amounts
and Swap Termination Payments. The Securities Administrator shall allocate the
issue price for a Class of Certificates among these components for purposes of
determining the issue
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price of the Upper-Tier Regular Interest component based on information
received from the Depositor. Unless otherwise advised by the Depositor in
writing, for federal income tax purposes, the Securities Administrator is
hereby directed to assign a value of zero to the right of each Holder of a
LIBOR Certificate to receive the related Tax Basis Risk Carry Forward Amount
for purposes of allocating the purchase price of an initial LIBOR
Certificateholder between such right and the related Upper-Tier Regular
Interest.
Holders of LIBOR Certificates shall also be treated as having agreed
to pay, on each Distribution Date, to the Holders of the Class X Certificates
an aggregate amount equal to the excess, if any, of (i) Net Swap Payment
Amounts and Swap Termination Payments (other that Defaulted Swap Termination
Payments) over (ii) the sum of amounts payable on the Class X Interest as
provided in the Preliminary Statement hereof (such excess, a "Class IO
Shortfall"), first from interest and then from principal distributable on the
LIBOR Certificates. A Class IO Shortfall payable from interest collections
shall be allocated pro rata among such LIBOR Certificates based on the amount
of interest otherwise payable to such Class of LIBOR Certificates, and a Class
IO Shortfall payable from principal collections shall be allocated in reverse
sequential order beginning with the most subordinate Class of LIBOR
Certificates then outstanding.
Any payments of Class IO Shortfalls shall be treated for tax purposes
as having been received by the Holders of such Class of LIBOR Certificates in
respect of the corresponding Upper-Tier Regular Interest and as having been
paid by such Holders to the Holders of the Class X Certificates through the
Supplemental Interest Trust.
Section 8.15 Custodial Responsibilities. Each of the Custodians shall
provide access to the Mortgage Loan documents in possession of such Custodian
regarding the related Mortgage Loans and REO Property and the servicing
thereof to the Trustee, the Certificateholders, the FDIC, and the supervisory
agents and examiners of the FDIC, such access being afforded only upon two (2)
Business Days prior written request and during normal business hours at the
office of such Custodian; provided, however, that, unless otherwise required
by law or any regulatory or administrative agency (including the FDIC), such
Custodian 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. Each of the Custodians shall allow representatives
of the above entities to photocopy any of the records and documentation and
shall provide equipment for that purpose at the expense of the Trust that
covers such Custodians actual costs.
Upon receipt of a request for release by a Servicer substantially in
the form of Exhibit L, Exhibit L-1 or Exhibit L-2 hereto, the applicable
Custodian shall release within five (5) Business Days the related Mortgage
File to such Servicer and the Trustee shall execute and deliver to such
Servicer, without recourse, a request for reconveyance, deed of reconveyance
or release or satisfaction of mortgage or such instrument releasing the lien
of the Mortgage (furnished by such Servicer), together with the Mortgage Note.
Each of the Custodians may resign at any time or may be terminated by
the Trustee with cause, in each case, upon sixty (60) days written notice to
the applicable Servicer, the Depositor and the Securities Administrator, in
which event the Depositor will be obligated to
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appoint a successor. If no successor has been appointed and has accepted
appointment within sixty (60) days after the resignation or termination of
such Custodian, such Custodian may petition any court of competent
jurisdiction for appointment of a successor.
The Securities Administrator, pursuant to a separate agreement, shall
compensate from its own funds the Custodians for their respective activities
under this Agreement. The Custodians shall have no lien on the Trust Fund for
the payment of such fees. The Custodians shall be entitled to be reimbursed,
from funds on deposit in the Distribution Account, amounts sufficient to
indemnify and hold harmless each of the Custodians and any director, officer,
employee, or agent of a Custodian against any loss, liability, or expense
(including reasonable attorneys' fees) incurred in connection with any claim
or legal action relating to:
(a) this Agreement;
(b) the Certificates; or
(c) the performance of any of such Custodian's duties under this
Agreement,
other than any loss, liability, or expense (i) resulting from any
breach of a Servicer's obligations in connection with a Servicing Agreement
for which the Servicer has performed its obligation to indemnify such
Custodian pursuant to such Servicing Agreement, (ii) resulting from any breach
of the Responsible Party's obligations in connection with a Sale Agreement for
which the Responsible Party has performed its obligation to indemnify such
Custodian pursuant to such Sale Agreement or (iii) incurred because of willful
misfeasance, bad faith, or negligence in the performance of any of such
Custodian's duties under this Agreement. This indemnity shall survive the
termination of this Agreement or the earlier resignation or removal of the
Custodians.
ARTICLE IX
ADMINISTRATION OF THE MORTGAGE LOANS
BY THE MASTER SERVICER
Section 9.01 Duties of the Master Servicer; Enforcement of Servicer's
Obligations. (a) The Master Servicer, on behalf of the Trustee, the Securities
Administrator, the Depositor and the Certificateholders, shall monitor the
performance of the Servicers under the related Servicing Agreements, and
(except as set forth below) shall use its reasonable good faith efforts to
cause the Servicers to duly and punctually perform their duties and
obligations thereunder as applicable. Upon the occurrence of an Event of
Default of which a Responsible Officer of the Master Servicer has actual
knowledge, the Master Servicer shall promptly notify the Securities
Administrator and the Trustee and shall specify in such notice the action, if
any, the Master Servicer plans to take in respect of such default. So long as
an Event of Default shall occur and be continuing, the Master Servicer shall
take the actions specified in Article VII.
If (i) a Servicer reports a delinquency on a monthly report and (ii)
such Servicer, by 11 a.m. (New York Time) on the Business Day preceding the
related Remittance Date, neither makes a Monthly Advance nor provides the
Securities Administrator and the Master Servicer with a report certifying that
such a Monthly Advance would be a Nonrecoverable Monthly
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Advance, then the Master Servicer shall deposit in the Distribution Account
not later than the Business Day immediately preceding the related Distribution
Date a Monthly Advance in an amount equal to the difference between (x) with
respect to each Monthly Payment due on a Mortgage Loan that is delinquent
(other than Relief Act Interest Shortfalls) and for which the related Servicer
was required to make a Monthly Advance pursuant to the related Servicing
Agreement and (y) amounts deposited in the Collection Account to be used for
Monthly Advances with respect to such Mortgage Loan, except to the extent the
Master Servicer determines any such Monthly Advance to be a Nonrecoverable
Monthly Advance or Nonrecoverable Servicing Advance. Subject to the foregoing,
the Master Servicer shall continue to make such Monthly Advances for so long
as the related Servicer is required to do so under the related Servicing
Agreement. If applicable, on the Business Day immediately preceding the
Distribution Date, the Master Servicer shall deliver an Officer's Certificate
to the Trustee stating that the Master Servicer elects not to make a Monthly
Advance in a stated amount and detailing the reason(s) it deems the Monthly
Advance to be a Nonrecoverable Monthly Advance. Any amounts deposited by the
Master Servicer pursuant to this Section 9.01 shall be net of the Servicing
Fee for the related Mortgage Loans. If the Master Servicer fails to make a
required Monthly Advance, the Securities Administrator shall provide prompt
written notice to the Trustee of such failure.
(b) The Master Servicer shall pay the costs of monitoring the
Servicers as required hereunder (including costs associated with (i)
termination of any Servicer, (ii) the appointment of a successor servicer or
(iii) the transfer to and assumption of, the servicing by the Master Servicer)
and shall, to the extent permitted by the related Servicing Agreement, seek
reimbursement therefor initially from the terminated Servicer. In the event
the full costs associated with the transition of servicing responsibilities to
the Master Servicer or to a successor servicer are not paid for by the
predecessor or successor Servicer (provided such successor Servicer is not the
Master Servicer), the Master Servicer may be reimbursed therefor by the Trust
for out-of-pocket costs incurred by the Master Servicer associated with any
such transfer of servicing duties from a Servicer to the Master Servicer or
any other successor servicer.
(c) If the Master Servicer assumes the servicing with respect to any
of the Mortgage Loans, it will not assume liability for the representations
and warranties of any Servicer it replaces or for any errors or omissions of
such Servicer.
If the Depositor or an affiliate of the Depositor, is the owner of
the servicing rights for any Servicer and the Depositor chooses to terminate
such Servicer with or without cause and sell those servicing rights to a
successor servicer, then the Depositor must provide thirty (30) days' notice
to the Master Servicer, such successor servicer must be reasonably acceptable
to the Master Servicer, the terminated servicer must be reimbursed for any
unreimbursed Monthly Advances, servicing fees and any related expenses, the
successor servicer must be qualified to service mortgage loans for ▇▇▇▇▇▇ Mae
or ▇▇▇▇▇▇▇ Mac and the Depositor must obtain prior written consent from the
Rating Agencies that the transfer of the servicing of the mortgage loans will
not result in a downgrade, qualification or withdrawal of the then current
ratings of the Certificates. The costs of such transfer (including any costs
of the Master Servicer) are to be borne by the Depositor.
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Neither the Depositor nor the Securities Administrator shall consent
to the assignment by any Servicer of such Servicer's rights and obligations
under the Agreement without the prior written consent of the Master Servicer,
which consent shall not be unreasonably withheld.
Section 9.02 Maintenance of Fidelity Bond and Errors and Omissions
Insurance. 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, directors, 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 9.03 Representations and Warranties of the Master Servicer.
(a) The Master Servicer hereby represents and warrants to the Depositor, the
Securities Administrator and the Trustee, for the benefit of the
Certificateholders, as of the Closing Date that:
(i) it is a national banking association validly existing and in
good standing under the laws of the United States of America, and as
Master Servicer has full power and authority to transact any and all
business contemplated by this Agreement and to execute, deliver and
comply with its obligations under the terms of this Agreement, the
execution, delivery and performance of which have been duly authorized by
all necessary corporate action on the part of the Master Servicer;
(ii) the execution and delivery of this Agreement by the Master
Servicer and its performance and compliance with the terms of this
Agreement will not (A) violate the Master Servicer's charter or bylaws,
(B) violate any law or regulation or any administrative decree or order
to which it is subject or (C) constitute a default (or an event which,
with notice or lapse of time, or both, would constitute a default) under,
or result in the breach of, any material contract, agreement or other
instrument to which the Master Servicer is a party or by which it is
bound or to which any of its assets are subject, which violation, default
or breach would materially and adversely affect the Master Servicer's
ability to perform its obligations under this Agreement;
(iii) this Agreement constitutes, assuming due authorization,
execution and delivery hereof by the other respective parties hereto, a
legal, valid and binding obligation of the Master Servicer, enforceable
against it in accordance with the terms hereof, except as such
enforcement may be limited by bankruptcy, insolvency, reorganization,
moratorium and other laws affecting the enforcement of creditors' rights
in general, and by general equity principles (regardless of whether such
enforcement is considered in a proceeding in equity or at law);
(iv) the Master Servicer is not in default with respect to any order
or decree of any court or any order or regulation of any federal, state,
municipal or governmental agency to the extent that any such default
would materially and adversely affect its performance hereunder;
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(v) the Master Servicer is not a party to or bound by any agreement
or instrument or subject to any charter provision, bylaw or any other
corporate restriction or any judgment, order, writ, injunction, decree,
law or regulation that may materially and adversely affect its ability as
Master Servicer to perform its obligations under this Agreement or that
requires the consent of any third person to the execution of this
Agreement or the performance by the Master Servicer of its obligations
under this Agreement;
(vi) no litigation is pending or, to the best of the Master
Servicer's knowledge, threatened against the Master Servicer which would
prohibit its entering into this Agreement or performing its obligations
under this Agreement;
(vii) [Reserved];
(viii) no consent, approval, authorization or order of any court or
governmental agency or body is required for the execution, delivery and
performance by the Master Servicer of or compliance by the Master
Servicer with this Agreement or the consummation of the transactions
contemplated by this Agreement, except for such consents, approvals,
authorizations and orders (if any) as have been obtained; and
(ix) the consummation of the transactions contemplated by this
Agreement are in the ordinary course of business of the Master Servicer.
(b) The applicable Step 2 Assignment Agreements and Section 11.01(a)
of this Agreement provide that Avelo, at its option, may purchase (or, if
Avelo is no longer acting as a Servicer of any of the Mortgage Loans, the
Depositor, at its option, may request the Master Servicer to solicit bids in a
commercially reasonable manner, on or after the Optional Termination Date
(such event, the "Auction Call"), for the purchase) of all of the Mortgage
Loans (and REO Properties) at the Termination Price. The Master Servicer shall
accommodate such request to conduct an Auction Call at its sole discretion.
Avelo, in consideration of the benefits to it of the transactions occurring
under this Agreement, the Assignment Agreements and the related Servicing
Agreement, hereby represents, covenants and agrees with the Depositor and any
applicable NIM Issuer that it will not exercise its right to purchase, on or
after the Optional Termination Date, all Mortgage Loans (and REO Properties)
unless it has received (x) written notification from the NIM Trustee that all
of the outstanding notes issued under the applicable indenture have been paid
in full or (y) an Officer's Certificate of the NIM Issuer pursuant to the
applicable section of the relevant indenture to the effect that all conditions
precedent to the satisfaction and discharge of the indenture have been
complied with. The Depositor hereby represents, covenants and agrees with any
applicable NIM Issuer that it will not exercise its right to request the
Master Servicer to solicit bids in a commercially reasonable manner, on or
after the Optional Termination Date, for the purchase of all of the Mortgage
Loans (and REO Properties) unless it has received (x) written notification
from the NIM Trustee that all of the outstanding notes issued under the
applicable indenture have been paid in full or (y) an Officer's Certificate of
the NIM Issuer pursuant to the applicable section of the relevant indenture to
the effect that all conditions precedent to the satisfaction and discharge of
the indenture have been complied with.
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The Master Servicer shall give Avelo written notice of the occurrence
of the Optional Termination Date upon the occurrence of the same.
(c) It is understood and agreed that the representations and
warranties set forth in this Section shall survive the execution and delivery
of this Agreement. The Master Servicer shall indemnify the Depositor,
Securities Administrator, and the Trustee and hold them harmless against any
loss, damages, penalties, fines, forfeitures, reasonable legal fees and
related costs, judgments, and other reasonable costs and expenses resulting
from any claim, demand, defense or assertion based on or grounded upon, or
resulting from, a material breach of the Master Servicer's representations and
warranties contained in Section 9.03(a) above. It is understood and agreed
that the enforcement of the obligation of the Master Servicer set forth in
this Section 9.03 to indemnify the Depositor, Securities Administrator, and
the Trustee constitutes the sole remedy of the Depositor and the Trustee,
respecting a breach of the foregoing representations and warranties. Such
indemnification shall survive any termination of the Master Servicer as Master
Servicer hereunder and any termination of this Agreement.
Any cause of action against the Master Servicer relating to or
arising out of the breach of any representations and warranties made in this
Section shall accrue upon discovery of such breach by either the Depositor,
the Master Servicer, Securities Administrator or the Trustee or notice thereof
by any one of such parties to the other parties.
Section 9.04 Master Servicer Events of Default. Each of the following
shall constitute a "Master Servicer Event of Default":
(a) any failure by the Master Servicer to deposit in the Distribution
Account any payment received by it from any Servicer or required to be made by
the Master Servicer under the terms of this Agreement which continues
unremedied for a period of two (2) 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 by any other party hereto;
(b) failure by the Master Servicer to duly observe or perform, in any
material respect, any other covenants, obligations or agreements of the Master
Servicer as set forth in this Agreement (including any obligation to cause any
subservicer or Reporting Subcontractor (except as specified below) to take any
action specified in Article XIII) which failure continues unremedied for a
period of thirty (30) days after the date on which written notice of such
failure, requiring the same to be remedied, shall have been given to the
Master Servicer by the Trustee or to the Master Servicer and the Trustee by
the holders of Certificates evidencing at least 25% of the Voting Rights;
provided that the thirty (30) day cure period shall not apply so long as the
Depositor is required to file Exchange Act Reports with respect to the Trust
Fund, the failure to comply with the requirements set forth in Article XIII,
for which the grace period shall not exceed the lesser of ten (10) calendar
days or such period in which the applicable Exchange Act Report can be timely
filed (without taking into account any extensions);
(c) a decree or order of a court or agency or supervisory authority
having jurisdiction for the appointment of a conservator or receiver or
liquidator in any insolvency, bankruptcy, readjustment of debt, marshaling of
assets and liabilities or similar proceedings, or for the winding-up or
liquidation of its affairs, shall have been entered against the Master
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Servicer and such decree or order shall have remained in force, undischarged
or unstayed for a period of sixty (60) days;
(d) the Master Servicer shall consent to the appointment of a
conservator or receiver or liquidator in any insolvency, bankruptcy,
readjustment of debt, marshaling of assets and liabilities or similar
proceedings of or relating to the Master Servicer or relating to all or
substantially all of its property;
(e) the Master Servicer shall admit in writing its inability to pay
its debts as they become due, file a petition to take advantage of any
applicable insolvency or reorganization statute, make an assignment for the
benefit of its creditors, or voluntarily suspend payment of its obligations
for three (3) Business Days;
(f) except as otherwise set forth herein, the Master Servicer
attempts to assign this Agreement or its responsibilities hereunder or to
delegate its duties hereunder (or any portion thereof) without the consent of
the Securities Administrator and the Depositor; or
(g) the indictment of the Master Servicer for the taking of any
action by the Master Servicer, any employee thereof, any Affiliate or any
director or employee thereof that constitutes fraud or criminal activity in
the performance of its obligations under this Agreement, in each case, where
such indictment materially and adversely affects the ability of the Master
Servicer to perform its obligations under this Agreement (subject to the
condition that such indictment is not dismissed within ninety (90) days).
In each and every such case, so long as a Master Servicer Event of
Default shall not have been remedied, in addition to whatever rights the
Trustee may have at law or equity to damages, including injunctive relief and
specific performance, the Trustee, by notice in writing to the Master
Servicer, may, and (a) upon the request of the Holders of Certificates
representing at least 51% of the Voting Rights (except with respect to any
Master Servicer Event of Default related to a failure to comply with an
Exchange Act Filing Obligation) or (b) the Depositor, in the case of a failure
related to an Exchange Act Filing Obligation, shall, terminate with cause all
the rights and obligations of the Master Servicer under this Agreement.
The Depositor shall not be entitled to terminate the rights and
obligations of the Master Servicer, pursuant to the above paragraph, if a
failure of the Master Servicer to identify a Subcontractor "participating in
the servicing function" within the meaning of Item 1122 of Regulation AB was
attributable solely to the role or functions of such Subcontractor with
respect to mortgage loans other than the Mortgage Loans.
Upon receipt by the Master Servicer of such written notice, all
authority and power of the Master Servicer under this Agreement, shall pass to
and be vested in any successor master servicer appointed hereunder which
accepts such appointments. Upon written request from the Trustee or the
Depositor, the Master Servicer shall prepare, execute and deliver to the
successor entity designated by the Trustee any and all documents and other
instruments related to the performance of its duties hereunder as the Master
Servicer and, place in such successor's possession all such documents with
respect to the master servicing of the Mortgage Loans and do or cause to be
done all other acts or things necessary or appropriate to effect the purposes
of such
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notice of termination, at the Master Servicer's sole expense. The Master
Servicer shall cooperate with the Trustee and such successor master servicer
in effecting the termination of the Master Servicer's responsibilities and
rights hereunder, including without limitation, the transfer to such successor
master servicer for administration by it of all cash amounts which shall at
the time be credited to the Distribution Account or are thereafter received
with respect to the Mortgage Loans.
Upon the occurrence of a Master Servicer Event of Default, the
Securities Administrator shall (i) provide prompt written notice to the
Trustee and the Depositor of such occurrence and (ii) provide the Depositor in
writing and in form and substance reasonably satisfactory to the Depositor,
all information reasonably requested by the Depositor in order to comply with
its reporting obligation under Item 6.02 of Form 8-K with respect to a
successor master servicer in the event the Trustee should succeed to the
duties of the Master Servicer as set forth herein. In the event that the
Master Servicer becomes a terminated Master Servicer due to a Master Servicer
Event of Default, the terminated Master Servicer shall bear all costs of the
transfer of master servicing hereunder (including those incurred by the
Trustee). If such costs are not paid by the terminated Master Servicer, such
costs shall be reimbursed from the Trust Fund.
Section 9.05 Waiver of Default. By a written notice, the Trustee may
with the consent of a Holders of Certificates evidencing at least 51% of the
Voting Rights waive any default by the Master Servicer in the performance of
its obligations hereunder and its consequences. Upon any waiver of a past
default, such default shall cease to exist, and any Master Servicer Event of
Default arising therefrom shall be deemed to have been remedied for every
purpose of this Agreement. No such waiver shall extend to any subsequent or
other default or impair any right consequent thereon except to the extent
expressly so waived.
Section 9.06 Successor to the Master Servicer. Upon termination of
the Master Servicer's responsibilities and duties under this Agreement, the
Trustee shall appoint or may petition any court of competent jurisdiction for
the appointment of a successor, which shall succeed to all rights and assume
all of the responsibilities, duties and liabilities of the Master Servicer
under this Agreement prior to the termination of the Master Servicer. Any
successor shall be a ▇▇▇▇▇▇ ▇▇▇ and ▇▇▇▇▇▇▇ Mac approved servicer in good
standing and acceptable to the Depositor and the Rating Agencies. In
connection with such appointment and assumption, the Trustee may make such
arrangements for the compensation of such successor out of payments on
Mortgage Loans as it and such successor shall agree; provided, however, that
in no event shall the master servicer fee paid to such successor master
servicer exceed that paid to the Master Servicer hereunder. In the event that
the Master Servicer's duties, responsibilities and liabilities under this
Agreement are terminated, the Master Servicer shall continue to discharge its
duties and responsibilities hereunder until the effective date of such
termination with the same degree of diligence and prudence which it is
obligated to exercise under this Agreement and shall take no action whatsoever
that might impair or prejudice the rights of its successor. The termination of
the Master Servicer shall not become effective until a successor shall be
appointed pursuant hereto and shall in no event (i) relieve the Master
Servicer of responsibility for the representations and warranties made
pursuant to Section 9.03(a) hereof and the remedies available to the Trustee
under Section 9.03(b) hereof, it being understood and agreed that the
provisions of Section 9.03 hereof shall be applicable to the Master Servicer
notwithstanding any
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such sale, assignment, resignation or termination of the Master Servicer or
the termination of this Agreement; or (ii) affect the right of the Master
Servicer to receive payment and/or reimbursement of any amounts accruing to it
hereunder prior to the date of termination (or during any transition period in
which the Master Servicer continues to perform its duties hereunder prior to
the date the successor master servicer fully assumes its duties).
If no successor Master Servicer has accepted its appointment within
ninety (90) days of the time the Trustee receives the resignation of the
Master Servicer, the Trustee shall be the successor Master Servicer in all
respects under this Agreement and shall have all the rights and powers and be
subject to all the responsibilities, duties and liabilities relating thereto,
including the obligation to make Monthly Advances; provided, however, that any
failure to perform any duties or responsibilities caused by the Master
Servicer's failure to provide information required by this Agreement shall not
be considered a default by the Trustee hereunder. In the Trustee's capacity as
such successor, the Trustee shall have the same limitations on liability
herein granted to the Master Servicer. As compensation therefor, the Trustee
shall be entitled to receive the compensation, reimbursement and indemnities
otherwise payable to the Master Servicer, including the fees and other amounts
payable pursuant to Section 9.07 hereof. At least fifteen (15) calendar days
prior to the effective date of such appointment, the Trustee shall provide
written notice to the Depositor of such successor pursuant to this Section
9.06.
Any successor master servicer appointed as provided herein, shall
execute, acknowledge and deliver to the Master Servicer and to the Trustee an
instrument accepting such appointment, wherein the successor shall make the
representations and warranties set forth in Section 9.03 hereof, and whereupon
such successor shall become fully vested with all of the rights, powers,
duties, responsibilities, obligations and liabilities of the Master Servicer,
with like effect as if originally named as a party to this Agreement. Any
termination or resignation of the Master Servicer or termination of this
Agreement shall not affect any claims that the Trustee may have against the
Master Servicer arising out of the Master Servicer's actions or failure to act
prior to any such termination or resignation or in connection with the
Trustee's assumption as successor master servicer of such obligations, duties
and responsibilities.
Upon a successor's acceptance of appointment as such, the Master
Servicer shall notify by mail the Trustee of such appointment.
Section 9.07 Compensation of the Master Servicer. As compensation for
its activities under this Agreement, the Master Servicer shall be paid the
Master Servicing Fee and be entitled to the investment income earned on
amounts in the Distribution Account during the Master Servicer Float Period.
Section 9.08 Merger or Consolidation. Any Person into which the
Master Servicer may be merged or consolidated, or any Person resulting from
any merger, conversion, other change in form 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 to the Master Servicer hereunder,
without the execution or filing of any paper or any further act on the part of
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any of the parties hereto, anything herein to the contrary notwithstanding;
provided, however, that the successor or resulting Person to the Master
Servicer shall (i) be a Person (or have an Affiliate) that is qualified and
approved to service mortgage loans for ▇▇▇▇▇▇ ▇▇▇ and FHLMC (provided, further
that a successor Master Servicer that satisfies subclause (i) through an
Affiliate agrees to service the Mortgage Loans in accordance with all
applicable ▇▇▇▇▇▇ Mae and FHLMC guidelines) and (ii) have a net worth of not
less than $25,000,000.
Section 9.09 Resignation of the Master Servicer. Except as otherwise
provided in Sections 9.08 and 9.10 hereof, the Master Servicer shall not
resign from the obligations and duties hereby imposed on it unless the Master
Servicer's duties hereunder are no longer permissible under applicable law or
are in material conflict by reason of applicable law with any other activities
carried on by it and cannot be cured. Any such determination permitting the
resignation of the Master Servicer shall be evidenced by an Opinion of Counsel
that shall be independent to such effect delivered to the Trustee. No such
resignation shall become effective until the Trustee shall have assumed, or a
successor master servicer satisfactory to the Trustee and the Depositor shall
have assumed, the Master Servicer's responsibilities and obligations under
this Agreement. Notice of such resignation shall be given promptly by the
Master Servicer and the Depositor to the Trustee.
At least fifteen (15) calendar days prior to the effective date of
such resignation, the Master Servicer shall provide written notice to the
Depositor of any successor pursuant to this Section.
If at any time, ▇▇▇▇▇ Fargo, as Master Servicer, resigns under this
Section 9.09, or is removed as Master Servicer pursuant to Section 9.04, then
at such time ▇▇▇▇▇ Fargo shall also resign (and shall be entitled to resign)
as Securities Administrator under this Agreement.
Section 9.10 Assignment or Delegation of Duties by the Master
Servicer. Except as expressly provided herein, the Master Servicer shall not
assign or transfer any of its rights, benefits or privileges hereunder to any
other Person, or delegate to or subcontract with, or authorize or appoint any
other Person to perform any of the duties, covenants or obligations to be
performed by the Master Servicer; provided, however, that the Master Servicer
shall have the right with the prior written consent of the Depositor (which
shall not be unreasonably withheld or delayed), and upon delivery to the
Trustee and the Depositor of a letter from each Rating Agency to the effect
that such action shall not result in a downgrade of the ratings assigned to
any of the Certificates, to delegate or assign to or subcontract with or
authorize or appoint any qualified Person to perform and carry out any duties,
covenants or obligations to be performed and carried out by the Master
Servicer hereunder. Notice of such permitted assignment shall be given
promptly by the Master Servicer to the Depositor and the Trustee. If, pursuant
to any provision hereof, the duties of the Master Servicer are transferred to
a successor master servicer, the entire compensation payable to the Master
Servicer pursuant hereto shall thereafter be payable to such successor master
servicer but in no event shall the fee payable to the successor master
servicer exceed that payable to the predecessor master servicer.
Section 9.11 Limitation on Liability of the Master Servicer. Neither
the Master Servicer nor any of the directors, officers, employees or agents of
the Master Servicer shall be under any liability to the Trustee, the
Securities Administrator, the Servicers or the
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Certificateholders for any action taken or for refraining from the taking of
any action in good faith pursuant to this Agreement, or for errors in
judgment; provided, however, that this provision shall not protect the Master
Servicer or any such person against any liability that would otherwise be
imposed by reason of willful malfeasance, bad faith or negligence in the
performance of its duties or by reason of reckless disregard for its
obligations and duties under this Agreement. The Master Servicer and any
director, officer, employee or agent of the Master Servicer may rely in good
faith on any document prima facie properly executed and submitted by any
Person respecting any matters arising hereunder. The Master Servicer shall be
under no obligation to appear in, prosecute or defend any legal action that is
not incidental to its duties as Master Servicer with respect to the Mortgage
Loans under this Agreement and that in its opinion may involve it in any
expenses or liability; provided, however, that the Master Servicer may in its
sole discretion undertake any such action that it may deem necessary or
desirable in respect to this Agreement and the rights and duties of the
parties hereto and the interests of the Certificateholders hereunder. In such
event, the legal expenses and costs of such action and any liability resulting
therefrom, shall be liabilities of the Trust, and the Master Servicer shall be
entitled to be reimbursed therefor out of the Master Servicer Account in
accordance with the provisions of Section 9.07 and Section 9.12.
The Master Servicer shall not be liable for any acts or omissions of
any Servicer except to the extent that damages or expenses are incurred as a
result of such act or omissions and such damages and expenses would not have
been incurred but for the negligence, willful malfeasance, bad faith or
recklessness of the Master Servicer in supervising, monitoring and overseeing
the obligations of the Servicers as required under this Agreement.
Section 9.12 Indemnification; Third Party Claims. The Master Servicer
agrees to indemnify the Depositor, the Securities Administrator, the
Servicers, the Trustee and Custodians, and hold them harmless against any and
all claims, losses, penalties, fines, forfeitures, legal fees and related
costs, judgments, and any other costs, liability, fees and expenses that the
Depositor, the Securities Administrator, the Servicers, the Trustee or the
Custodians may sustain as a result of the Master Servicer's willful
malfeasance, bad faith or negligence in the performance of its duties
hereunder or by reason of its reckless disregard for its obligations and
duties under this Agreement. The Depositor, the Securities Administrator, the
Servicers, the Trustee and the Custodians, as applicable, shall immediately
notify the Master Servicer if a claim is made by a third party with respect to
this Agreement or the Mortgage Loans which would entitle the Depositor, the
Servicers, the Trustee or the Custodians to indemnification under this Section
9.12, whereupon the Master Servicer shall assume the defense of any such claim
and pay all expenses in connection therewith, including counsel fees, and
promptly pay, discharge and satisfy any judgment or decree which may be
entered against it or them in respect of such claim.
The Master Servicer agrees to indemnify and hold harmless the Trustee
from and against any and all claims, losses, penalties, fines, forfeitures,
legal fees and related costs, judgments, and any other costs, liability, fees
and expenses (including reasonable attorneys' fees) that the Trustee may
sustain as a result of such liability or obligations of the Master Servicer
and in connection with the Trustee's assumption (not including the Trustee's
performance, except to the extent that costs or liability of the Trustee are
created or increased as a result of negligent or
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wrongful acts or omissions of the Master Servicer prior to its replacement as
Master Servicer) of the Master Servicer's obligations, duties or
responsibilities under such agreement.
The Trust will indemnify the Master Servicer and hold it harmless
against any and all claims, losses, penalties, fines, forfeitures, legal fees
and related costs, judgments, and any other costs, liabilities, fees and
expenses that the Master Servicer may incur or sustain in connection with,
arising out of or related to this Agreement, the Servicing Agreements, the
Sale Agreements, the Step 2 Assignment Agreements or the Certificates, except
to the extent that any such loss, liability or expense is related to (i) a
material breach of the Master Servicer's representations and warranties in
this Agreement or (ii) the Master Servicer's willful malfeasance, bad faith or
negligence or by reason of its reckless disregard of its duties and
obligations under any such agreement; provided, that any such loss, liability
or expense constitutes an "unanticipated expense incurred by the REMIC" within
the meaning of Treasury Regulations Section 1.860G-1(b)(3)(ii). The Master
Servicer shall be entitled to reimbursement for any such indemnified amount
from funds on deposit in the Distribution Account.
ARTICLE X
CONCERNING THE SECURITIES ADMINISTRATOR
Section 10.01 Duties of the Securities Administrator. The Securities
Administrator shall undertake to perform such duties and only such duties as
are specifically set forth in this Agreement.
(a) The Securities Administrator, upon receipt of all resolutions,
certificates, statements, opinions, reports, documents, orders or other
instruments furnished to the Securities Administrator that are specifically
required to be furnished pursuant to any provision of this Agreement shall
examine them to determine whether they are in the form required by this
Agreement; provided, however, that the Securities Administrator shall not be
responsible for the accuracy or content of any such resolution, certificate,
statement, opinion, report, document, order or other instrument. If any such
instrument is found not to conform in any material respect to the requirements
of this Agreement, the Securities Administrator shall notify the
Certificateholders of such non conforming instrument in the event the
Securities Administrator, after so requesting, does not receive a
satisfactorily corrected instrument.
(b) No provision of this Agreement shall be construed to relieve 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) the duties and obligations of the Securities Administrator shall
be determined solely by the express provisions of this Agreement, the
Securities Administrator shall not be liable except for the performance
of such duties and obligations as are specifically set forth in this
Agreement, no implied covenants or obligations shall be read into this
Agreement against the Securities Administrator and the Securities
Administrator 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 Securities Administrator and
conforming to the requirements of this Agreement
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which it believed in good faith to be genuine and to have been duly
executed by the proper authorities respecting any matters arising
hereunder;
(ii) the Securities Administrator shall not be liable for an error
of judgment made in good faith by a Responsible Officer or Responsible
Officers of the Securities Administrator, unless it shall be conclusively
determined by a court of competent jurisdiction, such determination no
longer subject to appeal, that the Securities Administrator was negligent
in ascertaining the pertinent facts;
(iii) the Securities Administrator shall not be liable with respect
to any action or inaction taken, suffered or omitted to be taken by it in
good faith in accordance with the direction of Holders of Certificates
evidencing not less than 25% of the Voting Rights of Certificates
relating to the time, method and place of conducting any proceeding for
any remedy available to the Securities Administrator, or exercising or
omitting to exercise any trust or power conferred upon the Securities
Administrator under this Agreement; and
(iv) the Securities Administrator shall not be accountable, shall
have no liability and makes no representation as to any acts or omissions
hereunder of the Master Servicer or the Trustee.
Section 10.02 Certain Matters Affecting the Securities Administrator.
Except as otherwise provided in Section 10.01:
(a) the Securities Administrator may request and conclusively rely
upon and shall be fully protected in acting or refraining from acting upon any
resolution, Officer's Certificate, certificate of auditors or any other
certificate, statement, instrument, opinion, report, notice, request, consent,
order, appraisal, bond or other paper or document believed by it to be genuine
and to have been signed or presented by the proper party or parties and the
Securities Administrator shall have no responsibility to ascertain or confirm
the genuineness of any signature of any such party or parties;
(b) the Securities Administrator may consult with counsel, financial
advisers or accountants and the advice of any such counsel, financial advisers
or accountants and any advice or Opinion of Counsel shall be full and complete
authorization and protection in respect of any action taken or suffered or
omitted by it hereunder in good faith and in accordance with such advice or
Opinion of Counsel;
(c) the Securities Administrator shall not be liable for any action
or inaction taken, suffered or omitted by it in good faith and believed by it
to be authorized or within the discretion or rights or powers conferred upon
it by this Agreement;
(d) the Securities Administrator shall not be bound to make any
investigation into the facts or matters stated in any resolution, certificate,
statement, instrument, opinion, report, notice, request, consent, order,
approval, bond or other paper or document, unless requested in writing so to
do by Holders of Certificates evidencing not less than 25% of the Voting
Rights allocated to each Class of Certificates; provided, however, that if the
payment within a reasonable time to the Securities Administrator of the costs,
expenses or liabilities likely
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to be incurred by it in the making of such investigation is, in the opinion of
the Securities Administrator, not reasonably assured to the Securities
Administrator by the security afforded to it by the terms of this Agreement,
the Securities Administrator may require reasonable indemnity against such
expense or liability as a condition to so proceeding. Nothing in this clause
(iv) shall derogate from the obligation of the Master Servicer to observe any
applicable law prohibiting disclosure of information regarding the Mortgagors,
provided that the Master Servicer shall have no liability for disclosure
required by this Agreement;
(e) the Securities Administrator may execute any of the trusts or
powers hereunder or perform any duties hereunder either directly or by or
through agents or attorneys or a custodian and the Securities Administrator
shall not be responsible for any misconduct or negligence on the part of any
such agent, attorney or custodian appointed by the Securities Administrator
with due care;
(f) the Securities Administrator shall not be required to risk or
expend its own funds or otherwise incur any financial liability in the
performance of any of its duties or in the exercise of any of its rights or
powers hereunder if it shall have reasonable grounds for believing that
repayment of such funds or adequate indemnity against such risk or liability
is not assured to it, and none of the provisions contained in this Agreement
shall in any event require the Securities Administrator to perform, or be
responsible for the manner of performance of, any of the obligations of the
Master Servicer under this Agreement;
(g) the Securities Administrator shall be under no obligation to
exercise any of the trusts, rights or powers vested in it by this Agreement or
to institute, conduct or defend any litigation hereunder or in relation hereto
at the request, order or direction of any of the Certificateholders, pursuant
to the provisions of this Agreement, unless such Certificateholders shall have
offered to the Securities Administrator reasonable security or indemnity
satisfactory to the Securities Administrator against the costs, expenses and
liabilities which may be incurred therein or thereby;
(h) the Securities Administrator shall have no obligation to appear
in, prosecute or defend any legal action that is not incidental to its duties
hereunder and which in its opinion may involve it in any expense or liability;
provided, however, that the Securities Administrator may in its discretion
undertake any such action that it may deem necessary or desirable in respect
of this Agreement and the rights and duties of the parties hereto and the
interests of the Trustee, the Securities Administrator and the
Certificateholders hereunder. In such event, the legal expenses and costs of
such action and any liability resulting therefrom shall be expenses, costs and
liabilities of the Trust Fund, and the Securities Administrator shall be
entitled to be reimbursed therefor out of the Collection Account; and
(i) in no event shall the Securities Administrator be liable for
special, indirect or consequential damages.
The Securities Administrator shall have no duty (A) to cause any
recording, filing, or depositing of this Agreement or any agreement referred
to herein or any financing statement or continuation statement evidencing a
security interest, or to see to the maintenance of any such recording or
filing or depositing or to any rerecording, refiling or redepositing thereof,
(B) to
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cause the provision of any insurance or (C) to cause the payment or discharge
of any tax, assessment, or other governmental charge or any lien or
encumbrance of any kind owing with respect to, assessed or levied against, any
part of the Trust Fund other than from funds available in the Distribution
Account.
Section 10.03 Securities Administrator Not Liable for Certificates or
Mortgage Loans. The recitals contained herein and in the Certificates shall be
taken as the statements of the Depositor or the Transferor, as the case may
be, and the Securities Administrator assumes no responsibility for their
correctness. The Securities Administrator makes no representations as to the
validity or sufficiency of this Agreement or of the Certificates or of any
Mortgage Loan or related document other than with respect to the Securities
Administrator's execution and authentication of the Certificates. The
Securities Administrator shall not be accountable for the use or application
by the Depositor or the Master Servicer of any funds paid to the Depositor or
the Master Servicer in respect of the Mortgage Loans or deposited in or
withdrawn from the Collection Account by the Depositor or the Master Servicer.
Section 10.04 Securities Administrator May Own Certificates. The
Securities Administrator in its individual or any other capacity may become
the owner or pledgee of Certificates and may transact business with the
parties hereto and their Affiliates with the same rights as it would have if
it were not the Securities Administrator.
Section 10.05 Securities Administrator's Fees and Expenses. The
Securities Administrator shall be entitled to the investment income earned on
amounts in the Distribution Account during the Master Servicer Float Period.
The Securities Administrator and any director, officer, employee, agent or
"control person" within the meaning of the Securities Act of 1933, as amended,
and the Securities Exchange of 1934, as amended ("Control Person"), of the
Securities Administrator shall be indemnified by the Trust and held harmless
against any loss, liability or expense (including reasonable attorney's fees)
(i) incurred in connection with any claim or legal action relating to (a) this
Agreement, (b) the Mortgage Loans or (c) the Certificates, other than any
loss, liability or expense incurred by reason of willful misfeasance, bad
faith or negligence in the performance of any of the Securities
Administrator's duties hereunder, (ii) incurred in connection with the
performance of any of the Securities Administrator's duties hereunder, other
than any loss, liability or expense incurred by reason of willful misfeasance,
bad faith or negligence in the performance of any of the Securities
Administrator's duties hereunder or (iii) incurred by reason of any action of
the Securities Administrator taken at the direction of the Certificateholders,
provided that any such loss, liability or expense constitutes an
"unanticipated expense incurred by the REMIC" within the meaning of Treasury
Regulations Section 1.860G-1(b)(3)(ii). Such indemnity shall survive the
termination of this Agreement or the resignation or removal of the Securities
Administrator hereunder. Without limiting the foregoing, and except for any
such expense, disbursement or advance as may arise from the Securities
Administrator's negligence, bad faith or willful misconduct, or which would
not be an "unanticipated expense" within the meaning of the second preceding
sentence, the Securities Administrator shall be reimbursed by the Trust for
all reasonable expenses, disbursements and advances incurred or made by the
Securities Administrator in accordance with any of the provisions of this
Agreement with respect to: (A) the reasonable compensation and the expenses
and disbursements of its counsel not associated with the closing of the
issuance of the Certificates, (B) the reasonable compensation, expenses and
disbursements of any accountant,
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engineer, appraiser or other agent that is not regularly employed by the
Securities Administrator, to the extent that the Securities Administrator must
engage such Persons to perform acts or services hereunder and (C) printing and
engraving expenses in connection with preparing any Definitive Certificates.
The Trust shall fulfill its obligations under this paragraph from amounts on
deposit from time to time in the Distribution Account.
The Securities Administrator may retain or withdraw from the
Distribution Account, (i) the Master Servicing Fee and the investment income
earned on amounts in the Distribution Account during the Master Servicer Float
Period, (ii) amounts necessary to reimburse it or the Master Servicer for any
previously unreimbursed Advances and any Advances the Master Servicer deems to
be non-recoverable from the related Mortgage Loan proceeds, (iii) an aggregate
annual amount to indemnify the Master Servicer and itself for amounts due in
accordance with this Agreement and (iv) any other amounts which it or the
Master Servicer is entitled to receive hereunder for reimbursement,
indemnification or otherwise, including the amount to which the Securities
Administrator is entitled pursuant to Section 3.02 hereof. The Securities
Administrator shall be required to pay all expenses incurred by it in
connection with its activities hereunder and shall not be entitled to
reimbursement therefor except as provided in this Agreement.
Section 10.06 Eligibility Requirements for the Securities
Administrator. The Securities Administrator hereunder shall at all times be a
corporation or association organized and doing business under the laws the
United States of America or any state thereof, authorized under such laws to
exercise corporate trust powers, having a combined capital and surplus of at
least $50,000,000, subject to supervision or examination by federal or state
authority and with a credit rating of at least investment grade. If such
corporation or association publishes reports of condition at least annually,
pursuant to law or to the requirements of the aforesaid supervising or
examining authority, then for the purposes of this Section 10.06 the combined
capital and surplus of such corporation or association shall be deemed to be
its combined capital and surplus as set forth in its most recent report of
condition so published. In case at any time the Securities Administrator shall
cease to be eligible in accordance with the provisions of this Section 10.06,
the Securities Administrator shall resign immediately in the manner and with
the effect specified in Section 10.07 hereof. The entity serving as Securities
Administrator may have normal banking and trust relationships with the
Depositor and its affiliates or the Trustee and its affiliates.
Any successor Securities Administrator (i) may not be an originator,
the Master Servicer, the Servicer, the Depositor or an affiliate of the
Depositor unless the Securities Administrator functions are operated through
an institutional trust department of the Securities Administrator, (ii) must
be authorized to exercise corporate trust powers under the laws of its
jurisdiction of organization, and (iii) must be rated at least "A/F1" by
Fitch, if Fitch is a Rating Agency and if rated by Fitch, or the equivalent
rating by S&P or ▇▇▇▇▇'▇. If no successor Securities Administrator shall have
been appointed and shall have accepted appointment within sixty (60) days
after the Securities Administrator ceases to be the Securities Administrator
pursuant to Section 10.07, then the Trustee may (but shall not be obligated
to) become the successor Securities Administrator. The Depositor shall appoint
a successor to the Securities Administrator in accordance with Section 10.07.
The Trustee shall notify the Rating Agencies of any change of Securities
Administrator.
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Section 10.07 Resignation and Removal of the Securities
Administrator. The Securities Administrator may at any time resign by giving
written notice of resignation to the Depositor and the Trustee and each Rating
Agency not less than sixty (60) days before the date specified in such notice
when, subject to Section 10.08, such resignation is to take effect, and
acceptance by a successor Securities Administrator in accordance with Section
10.08 meeting the qualifications set forth in Section 10.06. If no successor
Securities Administrator meeting such qualifications shall have been so
appointed by the Depositor and have accepted appointment within thirty (30)
days after the giving of such notice of resignation, the resigning Securities
Administrator may petition any court of competent jurisdiction for the
appointment of a successor Securities Administrator.
At least fifteen (15) calendar days prior to the effective date of
such resignation, the Securities Administrator shall provide written notice to
the Depositor or any successor pursuant to this Section 10.07.
If at any time (i) the Securities Administrator shall cease to be
eligible in accordance with the provisions of Section 10.06 hereof and shall
fail to resign after written request thereto by the Depositor, (ii) the
Securities Administrator shall become incapable of acting, or shall be
adjudged as bankrupt or insolvent, or a receiver of the Securities
Administrator or of its property shall be appointed, or any public officer
shall take charge or control of the Securities Administrator or of its
property or affairs for the purpose of rehabilitation, conservation or
liquidation, (iii)(A) a tax is imposed with respect to the Trust Fund by any
state in which the Securities Administrator or the Trust Fund is located and
(B) the imposition of such tax would be avoided by the appointment of a
different Securities Administrator, or (iv) the Securities Administrator fails
to comply with its obligations under Article XIII and such failure is not
remedied within the lesser of ten (10) calendar days or such period in which
the applicable Exchange Act Report can be timely filed (without taking into
account any extensions), then, in the case of clauses (i) through (iv), the
Depositor may remove the Securities Administrator and appoint a successor
Securities Administrator by written instrument, in triplicate, one copy of
which instrument shall be delivered to the Securities Administrator so
removed, one copy of which shall be delivered to the Master Servicer and one
copy to the successor Securities Administrator.
The Holders of Certificates entitled to at least 51% of the Voting
Rights may at any time remove the Securities Administrator and appoint a
successor Securities Administrator by written instrument or instruments, in
triplicate, signed by such Holders or their attorneys in fact duly authorized,
one complete set of which instruments shall be delivered by the successor
Securities Administrator to the Trustee, one complete set to the Securities
Administrator so removed and one complete set to the successor so appointed.
Notice of any removal of the Securities Administrator shall be given to each
Rating Agency by the successor Securities Administrator.
Any resignation or removal of the Securities Administrator and
appointment of a successor Securities Administrator pursuant to any of the
provisions of this Section 10.07 shall become effective upon acceptance by the
successor Securities Administrator of appointment as provided in Section 10.08
hereof.
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Section 10.08 Successor Securities Administrator. Any successor
Securities Administrator (which may be the Trustee) appointed as provided in
Section 10.07 hereof shall execute, acknowledge and deliver to the Depositor
and to its predecessor Securities Administrator and the Trustee an instrument
accepting such appointment hereunder and thereupon the resignation or removal
of the predecessor Securities Administrator shall become effective and such
successor 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 the like effect as if
originally named as Securities Administrator herein. The Depositor, the
Trustee, the Master Servicer and the predecessor Securities Administrator
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 Securities Administrator all such rights, powers, duties, and
obligations.
No successor Securities Administrator shall accept appointment as
provided in this Section 10.08 unless at the time of such acceptance such
successor Securities Administrator shall be eligible under the provisions of
Section 10.06 hereof and its appointment shall not adversely affect the then
current rating of the Certificates, as confirmed in writing by each Rating
Agency and has provided to the Depositor in writing and in form and substance
reasonably satisfactory to the Depositor, all information reasonably requested
by the Depositor in order to comply with its reporting obligation under Item
6.02 of Form 8-K with respect to a replacement Securities Administrator.
Upon acceptance by a successor Securities Administrator of
appointment as provided in this Section 10.08, the Depositor shall mail notice
of the succession of such Securities Administrator hereunder to all Holders of
Certificates. If the Depositor fails to mail such notice within ten (10) days
after acceptance by the successor Securities Administrator of appointment, the
successor Securities Administrator shall cause such notice to be mailed at the
expense of the Depositor.
Section 10.09 Merger or Consolidation of the Securities
Administrator. Any corporation or other entity into which the Securities
Administrator may be merged or converted or with which it may be consolidated
or any corporation or other entity resulting from any merger, conversion or
consolidation to which the Securities Administrator shall be a party, or any
corporation or other entity succeeding to the business of the Securities
Administrator, shall be the successor of the Securities Administrator
hereunder; provided, that such corporation or other entity shall be eligible
under the provisions of Section 10.06 hereof, 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 10.10 Assignment or Delegation of Duties by the Securities
Administrator. Except as expressly provided herein, the Securities
Administrator shall not assign or transfer any of its rights, benefits or
privileges hereunder to any other Person, or delegate to or subcontract with,
or authorize or appoint any other Person to perform any of the duties,
covenants or obligations to be performed by the Securities Administrator;
provided, however, that the Securities Administrator shall have the right with
the prior written consent of the Depositor (which shall not be unreasonably
withheld or delayed), and upon delivery to the Trustee and the Depositor of a
letter from each Rating Agency to the effect that such action shall
110
not result in a downgrade of the ratings assigned to any of the Certificates,
to delegate or assign to or subcontract with or authorize or appoint any
qualified Person to perform and carry out any duties, covenants or obligations
to be performed and carried out by the Securities Administrator hereunder.
Notice of such permitted assignment shall be given promptly by the Securities
Administrator to the Depositor and the Trustee. If, pursuant to any provision
hereof, the duties of the Securities Administrator are transferred to a
successor securities administrator, the entire compensation payable to the
Securities Administrator pursuant hereto shall thereafter be payable to such
successor securities administrator but in no event shall the fee payable to
the successor securities administrator exceed that payable to the predecessor
securities administrator.
ARTICLE XI
TERMINATION
Section 11.01 Termination upon Liquidation or Purchase of the
Mortgage Loans. Subject to Section 11.03, the obligations and responsibilities
of the Depositor, the Master Servicer, the Servicers, the Securities
Administrator and the Trustee created hereby with respect to the Trust Fund
shall terminate upon the earlier of: (a) Avelo, at its option, purchasing (the
"Avelo Call") (or, if Avelo is no longer acting as a Servicer of any of the
Mortgage Loans, the Depositor may request the Master Servicer to exercise its
option to conduct an Auction Call for the purchase of) the Mortgage Loans and
all other property of the Trust on a non-recourse basis with no
representations or warranties of any nature whatsoever and the sale of all of
the Property of the Trust Fund, on or after the Optional Termination Date. The
Master Servicer shall accommodate such request to conduct an Auction Call at
its sole discretion. The Property of the Trust Fund shall be sold by the
Trustee as directed by the Depositor or the Master Servicer to the entity with
the highest bid received by the Master Servicer from closed bids solicited by
the Master Servicer or its designee; provided, that to effectuate such sale,
the Master Servicer or its designee shall have made reasonable efforts to sell
all of the property of the Trust Fund for its fair market value in a
commercially reasonable manner and on commercially reasonable terms, which
includes the good faith solicitation of competitive bids to prospective
purchasers that are recognized broker/dealers for assets of this type and
provided further that, (i) such sale price shall not be less than the Par
Value as certified by the Depositor, (ii) the Master Servicer receives bids
from no fewer than three prospective purchasers (which may include the
Majority Class X Certificateholder) and (iii) such sale price shall be
deposited with the Master Servicer prior to the Distribution Date following
the month in which such value is determined; and (b) the later of (i) the
maturity or other liquidation (or any Advance with respect thereto) of the
last Mortgage Loan remaining in the Trust Fund and the disposition of all REO
Property and (ii) the distribution to Certificateholders of all amounts
required to be distributed to them pursuant to this Agreement. In no event
shall the trusts created hereby continue beyond the expiration of 21 years
from the death of the survivor of the descendants of ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇, the
late Ambassador of the United States to the Court of St. James's, living on
the date hereof. The "Termination Price" shall be equal to the greater of: (1)
the sum of (i) 100% of the unpaid principal balance of each Mortgage Loan
(other than in respect of REO Property) plus accrued and unpaid interest
thereon at the applicable Mortgage Interest Rate, (ii) the lesser of (x) the
appraised value of any REO Property as determined by the higher of two
appraisals completed by two independent appraisers selected by the Master
Servicer at its expense, plus accrued and unpaid interest on the related
mortgage loans at the applicable mortgage rate and (y) the unpaid principal
balance of each
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Mortgage Loan related to any REO Property, in each case plus accrued and
unpaid interest thereon at the applicable Mortgage Interest Rate; and (iii)
any Swap Termination Payment other than a Defaulted Swap Termination Payment
owed to the Swap Provider; and (2) the aggregate fair market value of each
Mortgage Loan and any REO Property, as determined by the highest bid received
by the Master Servicer from closed bids solicited by the Depositor or its
designee from at least three recognized broker/dealers (one of which may be an
affiliate of the Depositor) that deal in similar assets as of the close of
business on the third Business Day preceding the date upon which a Notice of
Final Distribution is furnished to Certificateholders pursuant to Section
11.02, plus accrued and unpaid interest on the Mortgage Loans at the
applicable Mortgage Interest Rate.
The proceeds of the purchase or sale of such assets of the Trust
pursuant to the Avelo Call or the Auction Call described in Section 11.01
above (other than, with respect to any mortgage loan and the related property,
an amount equal to the excess, if any, of the amount in Section 11.01(2)
over the sum of the amount in Section 11.01(1) (such excess, the "Fair
Market Value Excess")) will be distributed to the holders of the Certificates
in accordance with Section 4.01. Any Fair Market Value Excess received in
connection with the purchase of the Mortgage Loans and REO Properties will be
distributed to the holders of the Class RC Certificates.
Except to the extent provided above with regard to allocating any
Fair Market Value Excess to the holders of the Class RC Certificates, the
proceeds of such a purchase or sale will be treated as a prepayment of the
Mortgage Loans for purposes of distributions to Certificateholders.
Accordingly, the sale of the Mortgage Loans and the REO Properties as a result
of the exercise of the Avelo Call or the Auction Call will result in the final
distribution on the Certificates on that Distribution Date.
Section 11.02 Final Distribution on the Certificates. If, on any
Remittance Date, the Servicers notify the Securities Administrator that there
are no Outstanding Mortgage Loans and no other funds or assets in the Trust
Fund other than the funds in the Collection Account, the Securities
Administrator shall promptly send a Notice of Final Distribution to the
applicable Certificateholders. If Avelo exercises its option to terminate the
Trust Fund pursuant to clause (a) of Section 11.01, or if an Auction Call is
requested pursuant to clause (b) of such Section, the Master Servicer,
pursuant to the applicable Step 2 Assignment Agreements and by no later than
the tenth (10th) day of the month of final distribution, shall notify the
Trustee, each Servicer and the Securities Administrator of the final
Distribution Date and of the applicable sale price of the Mortgage Loans and
REO Properties.
A Notice of Final Distribution, specifying the Distribution Date on
which Certificateholders may surrender their Certificates for payment of the
final distribution and cancellation, shall be given promptly by the Securities
Administrator by letter to Certificateholders mailed not later than the
fifteenth (15th) day of the month of such final distribution. Any such Notice
of Final Distribution shall specify (a) the Distribution Date upon which final
distribution on the Certificates will be made upon presentation and surrender
of Certificates at the office therein designated, (b) the amount of such final
distribution, (c) the location of the office or agency at which such
presentation and surrender must be made, and (d) that the Record Date
otherwise applicable to such Distribution Date is not applicable,
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distributions being made only upon presentation and surrender of the
Certificates at the office therein specified. The Securities Administrator
will give such Notice of Final Distribution to each Rating Agency at the time
such Notice of Final Distribution is given to Certificateholders.
In the event the Mortgage Loans (and REO Properties) and all rights
and obligations under the Servicing Agreements are purchased or sold pursuant
to Section 11.01 and pursuant to the applicable Step 2 Assignment Agreement,
the Master Servicer on behalf of the Trustee is required thereunder to remit
to the Securities Administrator the applicable Termination Price on the
applicable Remittance Date immediately preceding the applicable final
Distribution Date. Upon such final deposit with respect to the Trust Fund and
the receipt by the Securities Administrator and the Custodians of a request
for release therefor in the form of Exhibit L, Exhibit L-1 or Exhibit L-2, as
applicable, the Master Servicer shall direct the Custodians to release and the
relevant Custodians shall promptly release to the Master Servicer or its
designee the Custodial Files for the Mortgage Loans.
Upon presentation and surrender of the Certificates, the Securities
Administrator shall cause to be distributed to the Certificateholders of each
Class (after reimbursement of all amounts due the Depositor, the Master
Servicer, the Securities Administrator, the Trustee and the Custodians
hereunder), in each case on the final Distribution Date and in the order set
forth in Section 4.01, in proportion to their respective Percentage Interests,
with respect to Certificateholders of the same Class, an amount up to an
amount equal to (i) as to each Class of Regular Certificates (except the Class
X Certificates), the Certificate Balance thereof plus for each such Class and
the Class X Certificates accrued interest thereon in the case of an
interest-bearing Certificate and all other amounts to which such Classes are
entitled pursuant to Section 4.01, and (ii) as to the Residual Certificates,
the amount, if any, which remains on deposit in the Distribution Account after
application pursuant to clause (i) above (other than the amounts retained to
meet claims). The foregoing provisions are intended to distribute to each
Class of Regular Certificates any accrued and unpaid interest and principal to
which they are entitled based on the Pass-Through Rates and actual Class
Certificate Balances or notional principal balances set forth in the
Preliminary Statement upon liquidation of the Trust Fund.
In the event that any affected Certificateholders shall not surrender
Certificates for cancellation within six (6) months after the date specified
in the above mentioned written notice, the Securities Administrator 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 (6) months after the second notice all the applicable
Certificates shall not have been surrendered for cancellation, the Securities
Administrator may take appropriate steps, or may appoint an 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 a part of the Trust Fund. If within one
(1) year after the second notice all Certificates shall not have been
surrendered for cancellation, the Class R Certificateholders shall be entitled
to all unclaimed funds and other assets of the Trust Fund which remain subject
hereto.
Section 11.03 Additional Termination Requirements. In the event the
Avelo Call or the Auction Call is exercised as provided in Section 11.01, the
Trust Fund shall be terminated in accordance with the following additional
requirements, unless the Trustee and the Securities
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Administrator have been supplied with an Opinion of Counsel, at the expense of
the entity exercising the call right, to the effect that the failure to comply
with the requirements of this Section 11.03 will not (i) result in the
imposition of taxes on "prohibited transactions" on any Trust REMIC as defined
in Section 860F of the Code, or (ii) cause any Trust REMIC to fail to qualify
as a REMIC at any time that any Certificates are outstanding:
(a) The Securities Administrator on behalf of the Trustee shall sell
all of the assets of the Trust Fund to the entity with the highest bid
received pursuant to the Auction Call and, by the next Distribution Date after
such sale, shall distribute to the Certificateholders the proceeds of such
sale in complete liquidation of each of the Trust REMICs; and
(b) The Securities Administrator shall attach a statement to the
final federal income tax return for each of the Trust REMICs stating that
pursuant to Treasury Regulations Section 1.860F-1, the first day of the ninety
(90) day liquidation period for each such Trust REMIC was the date on which
the Securities Administrator on behalf of the Trustee sold the assets of the
Trust Fund to the entity with the highest bid received pursuant to the Auction
Call.
ARTICLE XII
MISCELLANEOUS PROVISIONS
Section 12.01 Amendment. This Agreement may be amended from time to
time by the Depositor, the Master Servicer, the Securities Administrator, the
Custodians and the Trustee (and the Master Servicer may request an amendment
or consent to any amendment of a Servicing Agreement as directed by the
Depositor) without the consent of any of the Certificateholders (i) to cure
any ambiguity or mistake, (ii) to correct any defective provision herein or in
the applicable Servicing Agreement, or to supplement any provision in this
Agreement which may be inconsistent with any other provision herein or in the
applicable Servicing Agreement, (iii) to add to the duties of the Depositor,
or the Trustee (or with respect to the applicable Servicing Agreement, of the
applicable Servicer) the Master Servicer, the Securities Administrator or the
Custodians, (iv) to add any other provisions with respect to matters or
questions arising hereunder or under the applicable Servicing Agreement, (v)
to cause the provisions herein to conform to or be consistent with or in
furtherance of the statements made with respect to the Certificates, the Trust
Fund or this Agreement in the Prospectus Supplement, or to correct or
supplement any provision herein which may be inconsistent with any other
provisions herein or with the provisions of any underlying sale or servicing
agreement or (vi) to modify, alter, amend, add to or rescind any of the terms
or provisions contained in this Agreement or in the applicable Servicing
Agreement; provided that any action pursuant to clause (iv) or (vi) above
shall not, as evidenced by an Opinion of Counsel (which Opinion of Counsel
shall be an expense of the requesting party, but in any case shall not be an
expense of the Trustee, the Master Servicer, the Securities Administrator, the
Custodians or the Trust Fund, and shall be addressed to the foregoing
entities), adversely affect in any material respect the interests of any
Certificateholder; provided, further, that the amendment shall not be deemed
to adversely affect in any material respect the interests of the
Certificateholders if the Person requesting the amendment obtains a letter
from each Rating Agency stating that the amendment would not result in the
downgrading or withdrawal of the respective ratings then assigned to the
Certificates; it being understood and agreed that any such letter in and of
itself will not represent
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a determination as to the materiality of any such amendment and will represent
a determination only as to the credit issues affecting any such rating. The
Trustee, the Depositor, the Custodians, the Securities Administrator and the
Master Servicer also may at any time and from time to time amend this
Agreement (and the Master Servicer shall request the Servicers amend the
applicable Servicing Agreements), without the consent of the
Certificateholders, to modify, eliminate or add to any of its provisions to
such extent as shall be necessary or helpful to (i) maintain the qualification
of each Trust REMIC under the REMIC Provisions, (ii) avoid or minimize the
risk of the imposition of any tax on any Trust REMIC pursuant to the Code that
would be a claim at any time prior to the final redemption of the Certificates
or (iii) comply with any other requirements of the Code; provided, that the
Trustee and the Master Servicer have been provided an Opinion of Counsel,
which opinion shall be an expense of the party requesting such opinion but in
any case shall not be an expense of the Trustee or the Trust Fund, to the
effect that such action is necessary or helpful to, as applicable, (i)
maintain such qualification, (ii) avoid or minimize the risk of the imposition
of such a tax or (iii) comply with any such requirements of the Code.
This Agreement may also be amended from time to time by the
Depositor, the Master Servicer, the Custodians, the Securities Administrator
and the Trustee (and the Master Servicer shall consent to any amendment to the
applicable Servicing Agreement as directed by the Depositor) with the consent
of the Holders of Certificates evidencing Percentage Interests aggregating not
less than 66?% of each Class of Certificates affected thereby for the purpose
of adding any provisions to or changing in any manner or eliminating any of
the provisions of this Agreement or of modifying in any manner the rights of
the Holders of Certificates; provided, however, that no such amendment shall
(i) reduce in any manner the amount of, or delay the timing of, payments
required to be distributed on any Certificate without the consent of the
Holder of such Certificate, (ii) adversely affect in any material respect the
interests of the Holders of any Class of Certificates in a manner other than
as described in clause (i), without the consent of the Holders of Certificates
of such Class evidencing, as to such Class, Percentage Interests aggregating
not less than 66?%, or (iii) reduce the aforesaid percentages of Certificates
the Holders of which are required to consent to any such amendment, without
the consent of the Holders of all such Certificates then outstanding.
Notwithstanding any contrary provision of this Agreement, the Trustee
and the Master Servicer shall not consent to any amendment to this Agreement
or any Servicing Agreement unless (i) each shall have first received an
Opinion of Counsel, which opinion shall not be an expense of the Trustee, the
Master Servicer or the Trust Fund, to the effect that such amendment will not
cause the imposition of any tax on any Trust REMIC or the Certificateholders
or cause any Trust REMIC to fail to qualify as a REMIC at any time that any
Certificates are outstanding and (ii) the party seeking such amendment shall
have provided written notice to the Rating Agencies (with a copy of such
notice to the Trustee and the Master Servicer) of such amendment, stating the
provisions of the Agreement to be amended.
Notwithstanding the foregoing provisions of this Section 12.01, with
respect to any amendment that significantly modifies the permitted activities
of the Trustee or a Servicer under the applicable Servicing Agreement, any
Certificate beneficially owned by the Depositor or any of its Affiliates or by
the Responsible Party or any of its Affiliates shall be deemed not to be
outstanding (and shall not be considered when determining the percentage of
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Certificateholders consenting or when calculating the total number of
Certificates entitled to consent) for purposes of determining if the requisite
consents of Certificateholders under this Section 12.01 have been obtained.
Promptly after the execution of any amendment to this Agreement or
any Servicing Agreement requiring the consent of Certificateholders, the
Master Servicer shall furnish written notification of the substance or a copy
of such amendment to each Certificateholder and each Rating Agency.
It shall not be necessary for the consent of Certificateholders under
this Section 12.01 to approve the particular form of any proposed amendment,
but it shall be sufficient if such consent shall approve the substance
thereof. The manner of obtaining such consents and of evidencing the
authorization of the execution thereof by Certificateholders shall be subject
to such reasonable regulations as the Trustee may prescribe.
Nothing in this Agreement shall require the Trustee, the Custodians,
the Master Servicer or the Securities Administrator to enter into an amendment
which modifies its obligations or liabilities without its consent and in all
cases without receiving an Opinion of Counsel (which Opinion shall not be an
expense of the Trustee, the Custodians, the Master Servicer, the Securities
Administrator or the Trust Fund), satisfactory to the Trustee, the Master
Servicer or the Securities Administrator, as applicable, that (i) such
amendment is permitted and is not prohibited by this Agreement or the
applicable Servicing Agreement and that all requirements for amending this
Agreement or such Servicing Agreement have been complied with; and (ii) either
(A) the amendment does not adversely affect in any material respect the
interests of any Certificateholder or (B) the conclusion set forth in the
immediately preceding clause (A) is not required to be reached pursuant to
this Section 12.01.
Notwithstanding the Trustee's consent to, or the Master Servicer's
request for, any amendment of any Servicing Agreement pursuant to the terms of
this Section 12.01, such Servicing Agreement cannot be amended without the
consent of the applicable Servicer. Neither the Master Servicer nor the
Trustee shall be responsible for any failure by such Servicer to consent to
any amendment to the applicable Servicing Agreement.
Notwithstanding the foregoing, any amendment to this Agreement shall
require the prior written consent of the Swap Provider, if such amendment
materially and adversely affects the rights or interests of the Swap Provider.
Section 12.02 Recordation of Agreement; Counterparts. This Agreement
is subject to recordation in all appropriate public offices for real property
records in all the counties or other comparable jurisdictions in which any or
all of the properties subject to the Mortgages are situated, and in any other
appropriate public recording office or elsewhere, such recordation shall be
caused to be effected by the Depositor at the expense of the Trust, but only
if an Opinion of Counsel to the effect that such recordation materially and
beneficially affects the interests of the Certificateholders is delivered to
the Depositor.
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
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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 12.03 Governing Law. THIS AGREEMENT SHALL BE CONSTRUED IN
ACCORDANCE WITH AND GOVERNED BY THE SUBSTANTIVE LAWS OF THE STATE OF NEW YORK
APPLICABLE TO AGREEMENTS MADE AND TO BE PERFORMED IN THE STATE OF NEW YORK AND
THE OBLIGATIONS, RIGHTS AND REMEDIES OF THE PARTIES HERETO AND THE
CERTIFICATEHOLDERS SHALL BE DETERMINED IN ACCORDANCE WITH SUCH LAWS.
Section 12.04 Intention of Parties. It is the express intent of the
parties hereto that the conveyance (i) of the Mortgage Loans by the Depositor
and (ii) of the Trust Fund by the Depositor to the Trustee each be, and be
construed as, an absolute sale thereof. It is, further, not the intention of
the parties that such conveyances be deemed a pledge thereof. However, in the
event that, notwithstanding the intent of the parties, such assets are held to
be the property of the Depositor, or if for any other reason this Agreement is
held or deemed to create a security interest in either of such assets, then
(i) this Agreement shall be deemed to be a security agreement within the
meaning of the Uniform Commercial Code of the State of New York and (ii) the
conveyances provided for in this Agreement shall be deemed to be an assignment
and a grant by the Depositor to the Trustee, for the benefit of the
Certificateholders, of a security interest in all of the assets transferred,
whether now owned or hereafter acquired.
The Depositor, for the benefit of the Certificateholders, shall, to
the extent consistent with this Agreement, take such actions as may be
necessary to ensure that, if this Agreement were deemed to create a security
interest in the Trust Fund, such security interest would be deemed to be a
perfected security interest of first priority under applicable law and will be
maintained as such throughout the term of the Agreement. The Depositor shall
arrange for filing any Uniform Commercial Code continuation statements in
connection with any security interest granted or assigned to the Trustee for
the benefit of the Certificateholders.
Section 12.05 Notices. (a) The Securities Administrator shall use its
best efforts to promptly provide notice to each Rating Agency with respect to
each of the following of which it has actual knowledge:
(i) Any material change or amendment to this Agreement;
(ii) The occurrence of any Event of Default that has not been cured;
(iii) The resignation or termination of a Servicer, Master Servicer,
Securities Administrator or the Trustee and the appointment of any
successor;
(iv) The repurchase or substitution of Mortgage Loans pursuant to
this Agreement or the Sale Agreements; and
(v) The final payment to Certificateholders.
(b) In addition, the Securities Administrator shall promptly make
available on its internet website to each Rating Agency copies of the
following:
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(i) Each report to Certificateholders described in Section 4.02.
(ii) The Servicer's annual statement of compliance and the
accountant's report described in the Servicing Agreements; and
(iii) Any notice of a purchase of a Mortgage Loan pursuant to this
Agreement and any Sale Agreement.
(c) All directions, demands and notices hereunder shall be in writing
and shall be deemed to have been duly given when delivered to: (i) in the case
of the Depositor, the Purchaser or the Goldman Conduit, to ▇▇▇▇▇▇▇, Sachs &
Co., ▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇, Attention: Principal Finance
Group/▇▇▇▇▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇ and Asset Management Group/Senior Asset Manager,
or such other address as may be hereafter furnished to the Securities
Administrator and the Swap Provider by the Depositor in writing; (ii) in the
case of Avelo, to Avelo Mortgage, L.L.C., ▇▇▇ ▇. ▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇
▇▇▇, ▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇▇, Attention: President and General Counsel, or such
other address as may be hereafter furnished to the Depositor, the Securities
Administrator and the Swap Provider by Avelo in writing; (iii) in the case of
Countrywide and Countrywide Servicing, to Countrywide Home Loans Servicing LP,
▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇, Attention: Investor
Accounting, or such other address as may be hereafter furnished to the
Depositor, the Securities Administrator and the Swap Provider by Countrywide
Servicing in writing; (iv) in the case of BNY, to The Bank of New York Trust
Company, National Association, ▇▇▇▇ ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇, ▇▇▇▇▇▇,
▇▇▇▇▇ ▇▇▇▇▇, Attention: GSAA Home Equity Trust 2007-1, or such other address
as may be hereafter furnished to the Depositor, the Securities Administrator
and the Swap Provider by BNY in writing; (v) in the case of GreenPoint, to
GreenPoint Mortgage Funding, Inc., ▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇, ▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇
▇▇▇▇▇, Attention: ▇▇▇▇▇ ▇▇▇▇▇, or such other address as may be hereafter
furnished to the Depositor, the Securities Administrator and the Swap Provider
by GreenPoint in writing; (vi) in the case of Wachovia, to Wachovia Mortgage
Corporation, ▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇ ▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇▇▇▇▇
▇▇▇▇▇-▇▇▇▇, or such other address as may be hereafter furnished to the
Depositor, the Securities Administrator and the Swap Provider by Wachovia;
(vii) in the case of the Trustee to its Corporate Trust Office, or such other
address as the Trustee may be hereafter furnished to the Depositor and the
Swap Provider by the Trustee; (viii) in the case of the Master Servicer and
the Securities Administrator, to ▇▇▇▇▇ Fargo Bank, National Association, ▇.▇.
▇▇▇ ▇▇, ▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇ ▇▇▇▇▇, Attention: GSAA 2007-1, or such other
address as may be hereafter furnished to the hereafter furnished to the
Depositor, the Securities Administrator and the Swap Provider by the Master
Servicer in writing; (ix) in the case of Deutsche Bank, to Deutsche Bank
National Trust Company, ▇▇▇▇ ▇▇▇▇ ▇▇. ▇▇▇▇▇▇ ▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇, ▇▇▇▇▇▇▇▇▇▇
▇▇▇▇▇, Attention: Mortgage Custody - GS0701, or such other address as may be
hereafter furnished to the Depositor, the Securities Administrator and the
Swap Provider by Deutsche Bank in writing; (x) in the case of U.S. Bank, to
U.S. Bank National Association, ▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇, ▇▇. ▇▇▇▇,
▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇, Attention: GSAA Home Equity Trust 2007-1, or such other
address as may be hereafter furnished to the Depositor, the Securities
Administrator and the Swap Provider by the U.S. Bank in writing; (xi) in the
case of the Swap Provider, to the Swap Provider addressed to it at the address
specified in the Interest Rate Swap Agreement or at any other address
previously furnished in writing to the Trust by the related Swap Provider; and
(xii) in the case of each of the Rating Agencies, the address specified
therefor in the definition corresponding to the name of
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such Rating Agency. Notices to Certificateholders shall be deemed given when
mailed, first class postage prepaid, to their respective addresses appearing
in the Certificate Register.
Section 12.06 Severability of Provisions. If any one or more of the
covenants, agreements, provisions or terms of this Agreement shall be for any
reason whatsoever held invalid, then such covenants, agreements, provisions or
terms shall be deemed severable from the remaining covenants, agreements,
provisions or terms of this Agreement and shall in no way affect the validity
or enforceability of the other provisions of this Agreement or of the
Certificates or the rights of the Holders thereof.
Section 12.07 Limitation on Rights of Certificateholders. The death
or incapacity of any Certificateholder shall not operate to terminate this
Agreement or the trust created hereby, nor entitle such Certificateholder's
legal representative or heirs to claim an accounting or to take any action or
commence any proceeding in any court for a petition or winding up of the trust
created hereby, or otherwise affect the rights, obligations and liabilities of
the parties hereto or any of them.
No Certificateholder shall have any right to vote (except as provided
herein) or in any manner otherwise control the operation and management of the
Trust Fund, or the obligations of the parties hereto, nor shall anything
herein set forth or contained in the terms of the Certificates be construed so
as to constitute the Certificateholders from time to time as partners or
members of an association; nor shall any Certificateholder be under any
liability to any third party by reason of any action taken by the parties to
this Agreement pursuant to any provision hereof.
No Certificateholder shall have any right by virtue or by availing
itself of any provisions of this Agreement to institute any suit, action or
proceeding in equity or at law upon or under or with respect to this
Agreement, unless such Holder previously shall have given to the Trustee a
written notice of an Event of Default and of the continuance thereof, as
herein provided, and unless the Holders of Certificates evidencing not less
than 25% of the Voting Rights evidenced by the Certificates shall also have
made written request to the Trustee to institute such action, suit or
proceeding in its own name as Trustee hereunder and shall have offered to the
Trustee such reasonable indemnity as it may require against the costs,
expenses, and liabilities to be incurred therein or thereby, and the Trustee,
for sixty (60) days after its receipt of such notice, request and offer of
indemnity shall have neglected or refused to institute any such action, suit
or proceeding; it being understood and intended, and being expressly
covenanted by each Certificateholder with every other Certificateholder and
the Trustee, that no one or more Holders of Certificates shall have any right
in any manner whatever by virtue or by availing itself or themselves of any
provisions of this Agreement to affect, disturb or prejudice the rights of the
Holders of any other of the Certificates, or to obtain or seek to obtain
priority over or preference to any other such Holder or to enforce any right
under this Agreement, except in the manner herein provided and for the common
benefit of all Certificateholders. For the protection and enforcement of the
provisions of this Section 12.07, each and every Certificateholder and the
Trustee shall be entitled to such relief as can be given either at law or in
equity.
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Section 12.08 Certificates Nonassessable and Fully Paid. It is the
intention of the Depositor that Certificateholders shall not be personally
liable for obligations of the Trust Fund, that the interests in the Trust Fund
represented by the Certificates shall be nonassessable for any reason
whatsoever, and that the Certificates, upon due authentication thereof by the
Trustee pursuant to this Agreement, are and shall be deemed fully paid.
Section 12.09 Waiver of Jury Trial. EACH PARTY HEREBY KNOWINGLY,
VOLUNTARILY AND INTENTIONALLY WAIVES (TO THE EXTENT PERMITTED BY APPLICABLE
LAW) ANY RIGHT IT MAY HAVE TO A TRIAL BY JURY OF ANY DISPUTE ARISING UNDER OR
RELATING TO THIS AGREEMENT AND AGREES THAT ANY SUCH DISPUTE SHALL BE TRIED
BEFORE A JUDGE SITTING WITHOUT A JURY.
Section 12.10 Rights of the Swap Provider. The Swap Provider shall be
deemed a third party beneficiary of this Agreement to the same extent as if it
were a party hereto, and shall have the right to enforce its rights under this
Agreement.
ARTICLE XIII
ARTICLE XIII EXCHANGE ACT REPORTING
Section 13.01 Filing Obligations.
The Master Servicer, the Trustee, the Securities Administrator and
each Custodian shall reasonably cooperate with the Depositor and Securities
Administrator in connection with the satisfaction of the Depositor's reporting
requirements under the Exchange Act with respect to the Trust Fund. In
addition to the information specified below, if so requested by the Depositor
in writing for the purpose of satisfying its reporting obligation under the
Exchange Act, the Master Servicer, the Trustee, the Securities Administrator
and each Custodian shall (and the Master Servicer shall cause each Servicer
and subservicer to) provide the Depositor with (a) such information which is
available to such Person without unreasonable effort or expense and within
such timeframe as may be reasonably requested by the Depositor to comply with
the Depositor's reporting obligations under the Exchange Act and (b) to the
extent such Person is a party (and the Depositor is not a party) to any
agreement or amendment required to be filed, copies of such agreement or
amendment in ▇▇▇▇▇-compatible form.
In the event that the Securities Administrator becomes aware that it
will be unable to timely file with the Commission all or any required portion
of any Form 8-K, 10-D or 10-K required to be filed by this Agreement because
required disclosure information was either not delivered to it or delivered to
it after the delivery deadlines set forth in this Agreement or for any other
reason, the Securities Administrator will promptly notify the Depositor. In
the case of Form 10-D and 10-K, the parties to this Agreement will cooperate
and cause such other Servicers or Servicing Function Participants, as
applicable, to cooperate, to prepare and file a Form 12b-25 and a 10-DA and
10-KA as applicable, pursuant to Rule 12b-25 of the Exchange Act. In the case
of Form 8-K, the Securities Administrator will, upon receipt of all required
Form 8-K Disclosure Information and upon the approval and direction of the
Depositor, include such disclosure information on the next Form 10-D unless
directed by the Depositor to file a Form 8-K with such
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Form 8-K Disclosure Information. In the event that any previously filed Form
8-K, Form 10-D or Form 10-K needs to be amended, the Securities Administrator
shall notify the Depositor and prepare any necessary Form 8-KA, Form 10-DA or
Form 10-KA. Any Form 15, Form 12b-25 or any amendment to Form 8-K or Form 10-D
shall be signed by a duly authorized representative of the Master Servicer.
Any amendment to Form 10-K shall be signed by the Depositor. The parties to
this Agreement acknowledge that the performance by the Securities
Administrator of its duties under this Section 13.01 related to the timely
preparation and filing of Form 15, a Form 12b-25 or any amendment to Form 8-K,
Form 10-D or Form 10-K is contingent upon each such party performing its
duties under this Section. The Securities Administrator shall have no
liability for any loss, expense, damage or claim arising out of or with
respect to any failure to properly prepare and/or timely file any such Form
15, Form 12b-25 or any amendments to Form 8-K, Form 10-D or Form 10-K, where
such failure results from the Securities Administrator's inability or failure
to receive on a timely basis, any information from or on behalf of any other
party hereto needed to prepare, arrange for execution or file such Form 15,
Form 12b-25 or any amendments to Forms 8-K, 10-D or 10-K, not resulting from
its own negligence, bad faith or willful misconduct.
The Securities Administrator shall promptly file, and exercise its
reasonable best efforts to obtain a favorable response to, no-action requests,
or other appropriate exemptive relief with the Commission seeking the usual
and customary exemption from such reporting requirements granted to issuers of
securities similar to the Certificates if and to the extent the Depositor
shall deem any such relief to be necessary or appropriate. Unless otherwise
advised by the Depositor, the Securities Administrator shall assume that the
Depositor is in compliance with the preceding sentence. In no event shall the
Securities Administrator have any liability for the execution or content of
any document required to be filed by the 1934 Act. 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 the Trust Agreement and the Mortgage Loans as the
Depositor reasonably deems appropriate to prepare and file all necessary
reports with the Commission.
Section 13.02 Form 8-K Filings.
The Depositor shall prepare or cause to be prepared the initial
current report on Form 8-K. Thereafter within four (4) Business Days after the
occurrence of an event requiring disclosure in a current report on Form 8-K
(each such event, a "Reportable Event"), and if requested by the Depositor,
the Master Servicer shall sign on behalf of the Depositor and the Securities
Administrator shall prepare and file with the Commission any Form 8-K, as
required by the Exchange Act. Any disclosure or information related to a
Reportable Event or that is otherwise required to be included on Form 8-K
("Form 8-K Disclosure Information") shall be determined and prepared by and at
the direction of the Depositor pursuant to this Section 13.02 and the
Securities Administrator shall have no duty or liability for any failure
hereunder to determine or prepare any Form 8-K Disclosure Information or any
Form 8-K, except as set forth in this Section 13.02.
As set forth on Exhibit M hereto, for so long as the Trust is subject
to the Exchange Act reporting requirements, no later than the end of business
on the second Business Day after the occurrence of a Reportable Event each of
the Securities Administrator, the
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Custodians, the Master Servicer and the Depositor shall be required to provide
to the Securities Administrator and Depositor, to the extent known, in
▇▇▇▇▇-compatible form, or in such other form as otherwise agreed upon by the
Securities Administrator and such party, the form and substance of any Form
8-K Disclosure Information, if applicable and (ii) the Depositor shall
approve, as to form and substance, or disapprove, as the case may be, the
inclusion of the Form 8-K Disclosure Information. The Depositor shall be
responsible for any reasonable fees and expenses assessed or incurred by the
Securities Administrator in connection with including any Form 8-K Disclosure
Information on Form 8-K pursuant to this paragraph.
After preparing the Form 8-K, the Securities Administrator shall
forward electronically a draft copy of the Form 8-K to the Depositor for
review. No later than 12:00 noon New York City time on the fourth (4th)
Business Day after the Reportable Event, a duly authorized representative of
the Master Servicer shall sign the Form 8-K and return such signed Form 8-K to
the Securities Administrator, and no later than 5:30 p.m. New York City time
on such Business Day the Securities Administrator shall file such Form 8-K
with the Commission. If a Form 8-K cannot be filed on time or if a previously
filed Form 8-K needs to be amended, the Securities Administrator will follow
the procedures set forth in Section 13.01. Promptly (but no later than one (1)
Business Day) after filing with the Commission, the Securities Administrator
will, make available on its internet website (located at ▇▇▇.▇▇▇▇▇▇▇.▇▇▇) a
final executed copy of each Form 8-K prepared by the Securities Administrator.
The signing party at the Master Servicer can be contacted at ▇▇▇▇ ▇▇▇
▇▇▇▇▇▇▇▇▇ ▇▇▇▇, ▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇ ▇▇▇▇▇-▇▇▇▇, Attention: Corporate Trust,
GSAA 2007-1, by e-mail at ▇▇▇.▇▇▇.▇▇▇▇▇▇▇▇▇▇▇▇▇@▇▇▇▇▇▇▇▇▇▇.▇▇▇ or by facsimile
(▇▇▇) ▇▇▇-▇▇▇▇. The parties to this Agreement acknowledge that the performance
by the Securities Administrator of its duties under this Section 13.02 related
to the timely preparation and filing of Form 8-K is contingent upon such
parties strictly observing all applicable deadlines in the performance of
their duties under this Section 13.02. The Securities Administrator shall have
no liability for any loss, expense, damage, claim arising out of or with
respect to any failure to properly prepare and/or timely file such Form 8-K,
where such failure results from the Securities Administrator's inability or
failure to receive on a timely basis, any information from any other party
hereto (other than an Affiliate) needed to prepare, arrange for execution or
file such Form 8-K, not resulting from its own negligence, bad faith or
willful misconduct.
Section 13.03 Form 10-D Filings.
Within fifteen (15) days after each Distribution Date (subject to
permitted extensions under the Exchange Act and until a Form 15 is filed
pursuant to Section 13.05), the Securities Administrator shall prepare and
file with the Commission, and the Master Servicer shall sign on behalf of the
Depositor any distribution report on Form 10-D required by the Exchange Act,
in form and substance as required by the Exchange Act. The Securities
Administrator shall file each Form 10-D with a copy of the related Monthly
Statement attached thereto. Any disclosure in addition to the monthly
statement that is required to be included on Form 10-D ("Additional Form 10-D
Disclosure") shall be determined and prepared by and at the direction of the
Depositor pursuant to the following paragraph and the Securities Administrator
will have no duty or liability for any failure hereunder to determine or
prepare any Additional Form 10-D Disclosure, except as set forth in this
Section 13.03.
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As set forth on Exhibit N hereto, within five (5) calendar days after
the related Distribution Date, (i) certain parties to the GSAA Home Equity
Trust 2007-1 Asset-Backed Certificates transaction shall be required to
provide to the Securities Administrator and the Depositor, to the extent
known, in ▇▇▇▇▇-compatible form, or in such other form as otherwise agreed
upon by the Securities Administrator and such party, the form and substance of
any Additional Form 10-D Disclosure, if applicable and (ii) the Depositor will
approve, as to form and substance, or disapprove, as the case may be, the
inclusion of the Additional Form 10-D Disclosure on Form 10-D. The Depositor
shall be responsible for any reasonable fees and expenses assessed or incurred
by the Securities Administrator in connection with any Additional Form 10-D
Disclosure on Form 10-D pursuant to this Section 13.03.
After preparing the Form 10-D, the Securities Administrator shall
forward electronically a draft copy of the Form 10-D to the Depositor for
review. No later than two (2) Business Days following the tenth (10th)
calendar day after the related Distribution Date, a duly authorized
representative of the Master Servicer shall sign the Form 10-D and return such
signed Form 10-D to the Securities Administrator and Depositor, and no later
than 5:30 p.m. New York City time on the fifteenth (15th) calendar day after
such Distribution Date the Securities Administrator shall file such Form 10-D
with the Commission. If a Form 10-D cannot be filed on time or if a previously
filed Form 10-D needs to be amended, the Securities Administrator will follow
the procedures set forth in Section 13.01. Promptly (but no later than one (1)
Business Day) after filing with the Commission, the Securities Administrator
will make available on its internet website (located at ▇▇▇.▇▇▇▇▇▇▇.▇▇▇) a
final executed copy of each Form 10-D prepared by the Securities
Administrator. The signing party at the Master Servicer can be contacted at
▇▇▇▇ ▇▇▇ ▇▇▇▇▇▇▇▇▇ ▇▇▇▇, ▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇ ▇▇▇▇▇-▇▇▇▇, Attention: Corporate
Trust, GSAA 2007-1, by e-mail at ▇▇▇.▇▇▇.▇▇▇▇▇▇▇▇▇▇▇▇▇@▇▇▇▇▇▇▇▇▇▇.▇▇▇ or by
facsimile (▇▇▇) ▇▇▇-▇▇▇▇. Each party to this Agreement acknowledges that the
performance by the Securities Administrator of its duties under this Section
13.03 related to the timely preparation and filing of Form 10-D is contingent
upon such parties strictly observing all applicable deadlines in the
performance of their duties under this Section 13.03. The Securities
Administrator shall have no liability for any loss, expense, damage or claim
arising out of or with respect to any failure to properly prepare and/or
timely file such Form 10-D, where such failure results from the Securities
Administrator's inability or failure to receive on a timely basis, any
information from any other party hereto needed to prepare, arrange for
execution or file such Form 10-D, not resulting from its own negligence, bad
faith or willful misconduct.
Form 10-D requires the registrant to indicate (by checking "yes" or
"no") that it "(1) has filed all reports required to be filed by Section 13 or
15(d) of the Exchange Act during the preceding 12 months (or for such shorter
period that the registrant was required to file such reports), and (2) has
been subject to such filing requirements for the past 90 days." The Depositor
shall notify the Securities Administrator in writing, no later than the fifth
calendar day after the related Distribution Date with respect to the filing of
a report on Form 10-D if the answer to the questions should be "no". The
Securities Administrator shall be entitled to rely on such representations in
preparing, executing and/or filing any such report.
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Section 13.04 Form 10-K Filings.
Within ninety (90) days after the end of each fiscal year of the
Trust or such earlier date as may be required by the Exchange Act (the "10-K
Filing Deadline") (it being understood that the fiscal year for the Trust ends
on December 31 of each year), commencing in March 2008 and continuing until
the Trust has been deregistered with the Commission, the Securities
Administrator shall prepare and file on behalf of the Depositor an annual
report on Form 10-K, in form and substance as required by the Exchange Act.
Each such Form 10-K shall include the following items, in each case to the
extent they have been delivered to the Securities Administrator within the
applicable time frames set forth in this Agreement and the related Servicing
Agreement: (i) an annual compliance statement for each Servicer, each
Additional Servicer and the Master Servicer (each such party, a "Reporting
Servicer") as described below, (ii)(A) the annual reports on assessment of
compliance with servicing criteria for each Reporting Servicer, as described
under this Section 13.04 and Section 13.07, and (B) if each Reporting
Servicer's report on assessment of compliance with servicing criteria
described under Section 13.04 and Section 13.07 identifies any material
instance of noncompliance, disclosure identifying such instance of
noncompliance, or if each Reporting Servicer's report on assessment of
compliance with servicing criteria described under Section 13.04 and Section
13.07 is not included as an exhibit to such Form 10-K, disclosure that such
report is not included and an explanation why such report is not included,
(iii)(A) the registered public accounting firm attestation report for each
Reporting Servicer, as described under Section 13.07, and (B) if any
registered public accounting firm attestation report described under Section
13.07 identifies any material instance of noncompliance, disclosure
identifying such instance of noncompliance, or if any such registered public
accounting firm attestation report is not included as an exhibit to such Form
10-K, disclosure that such report is not included and an explanation why such
report is not included, and (iv) a ▇▇▇▇▇▇▇▇-▇▇▇▇▇ Certification as described
in Section 13.06. Any disclosure or information in addition to the disclosure
or information specified in items (i) through (iv) above that is required to
be included on Form 10-K ("Additional Form 10-K Disclosure") shall be
determined and prepared by and at the direction of the Depositor pursuant to
the following paragraph and the Securities Administrator shall have no duty or
liability for any failure hereunder to determine or prepare any Additional
Form 10-K Disclosure, except as set forth in this Section 13.04.
The Master Servicer and the Securities Administrator shall deliver
(and the Master Servicer and Securities Administrator shall cause any
Additional Servicer engaged by it to deliver) to the Depositor and the
Securities Administrator on or before March 15 of each year, commencing in
March 2008, an Officer's Certificate stating, as to the signer thereof, that
(i) a review of such party's activities during the preceding calendar year or
portion thereof and of such party's performance under this Agreement, or such
other applicable agreement in the case of an Additional Servicer, has been
made under such officer's supervision and (ii) to the best of such officer's
knowledge, based on such review, such party has fulfilled all its obligations
under this Agreement, or such other applicable agreement in the case of an
Additional Servicer, in all material respects throughout such year or portion
thereof, or, if there has been a failure to fulfill any such obligation in any
material respect, specifying each such failure known to such officer and the
nature and status thereof. Promptly after receipt of each such officer's
certificate, the Depositor shall review such officer's certificate and consult
with each such party, as applicable,
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as to the nature of any failures by such party, in the fulfillment of any of
such party's obligations hereunder or, in the case of an Additional Servicer,
under such other applicable agreement.
The Master Servicer shall enforce any obligation of the Servicers, to
the extent set forth in the related Servicing Agreement, to deliver to the
Master Servicer an annual statement of compliance within the time frame set
forth in, and in such form and substance as may be required pursuant to, the
related Servicing Agreement The Master Servicer shall include such annual
statements of compliance with its own annual statement of compliance to be
submitted to the Securities Administrator pursuant to this Section.
As set forth on Exhibit O hereto, no later than March 15 of each year
that the Trust is subject to the Exchange Act reporting requirements,
commencing in 2008 and continuing until the Trust has been deregistered with
the Commission, (i) certain parties to the GSAA Home Equity Trust 2007-1
Asset-Backed Certificates transaction shall be required to provide to the
Securities Administrator and the Depositor, to the extent known, in
▇▇▇▇▇-compatible form, or in such other form as otherwise agreed upon by the
Securities Administrator and such party, the form and substance of any
Additional Form 10-K Disclosure, if applicable, and (ii) the Depositor shall
approve, as to form and substance, or disapprove, as the case may be, the
inclusion of the Additional Form 10-K Disclosure on Form 10-K. The Depositor
shall be responsible for any reasonable fees and expenses assessed or incurred
by the Securities Administrator in connection with including any Additional
Form 10-K Disclosure on Form 10-K pursuant to this Section 13.04.
After preparing the Form 10-K, the Securities Administrator shall
forward electronically a draft copy of the Form 10-K to the Depositor for
review. No later than 12:00 noon New York City time on the fourth Business Day
prior to the 10-K Filing Deadline, a senior officer of the Depositor shall
sign the Form 10-K and return such signed Form 10-K to the Securities
Administrator. If a Form 10-K cannot be filed on time or if a previously filed
Form 10-K needs to be amended, the Securities Administrator will follow the
procedures set forth in 13.01. Promptly (but no later than one (1) Business
Day) after filing with the Commission, the Securities Administrator will make
available on its internet website located at (located at ▇▇▇.▇▇▇▇▇▇▇.▇▇▇) a
final executed copy of each Form 10-K prepared by the Securities
Administrator. The parties to this Agreement acknowledge that the performance
by the Securities Administrator of its duties under this Section 13.04 related
to the timely preparation and filing of Form 10-K is contingent upon such
parties (and any Additional Servicer or Servicing Function Participant)
strictly observing all applicable deadlines in the performance of their duties
under this Section 13.04, Section 13.06, Section 13.01 and Section 13.07. The
Securities Administrator shall have no liability for any loss, expense,
damage, claim arising out of or with respect to any failure to properly
prepare and/or timely file such Form 10-K, where such failure results from the
Securities Administrator's inability or failure to receive on a timely basis,
any information from any other party hereto needed to prepare, arrange for
execution or file such Form 10-K, not resulting from its own negligence, bad
faith or willful misconduct.
Form 10-K requires the registrant to indicate (by checking "yes" or
"no") that it "(1) has filed all reports required to be filed by Section 13 or
15(d) of the Exchange Act during the preceding 12 months (or for such shorter
period that the registrant was required to file such reports), and (2) has
been subject to such filing requirements for the past 90 days." The
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Depositor shall notify the Securities Administrator in writing, no later than
March 15th if the answer to the questions should be "no". The Securities
Administrator shall be entitled to rely on such representations in preparing,
executing and/or filing any such report.
Section 13.05 Form 15 Filing.
Prior to January 30 of the first year in which the Securities
Administrator is able to do so under applicable law, the Securities
Administrator shall prepare, sign and file a Form 15 relating to the automatic
suspension of reporting in respect of the Trust Fund under the Exchange Act.
Section 13.06 ▇▇▇▇▇▇▇▇-▇▇▇▇▇ Certification.
Each Form 10-K shall include a certification, (the "▇▇▇▇▇▇▇▇-▇▇▇▇▇
Certification") required by Rules 13a-14(d) and 15(d)-14(d) under the Exchange
Act (pursuant to Section 302 of the ▇▇▇▇▇▇▇▇-▇▇▇▇▇ Act of 2002 and the rules
and regulations of the Commission promulgated thereunder). Each Servicer, the
Securities Administrator and the Master Servicer shall cause any Servicing
Function Participant engaged by it to provide to the Person who signs the
▇▇▇▇▇▇▇▇-▇▇▇▇▇ Certification (the "Certifying Person"), by March 15 of each
year in which the Trust is subject to the reporting requirements of the
Exchange Act and otherwise within a reasonable period of time upon request, a
certification (each, a "Back-Up Certification"), in the form attached hereto
as Exhibit J-1 (in the case of the Master Servicer) and Exhibit J-2 (in the
case of the Securities Administrator), upon which the Certifying Person, the
entity for which the Certifying Person acts as an officer, and such entity's
officers, directors and Affiliates (collectively with the Certifying Person,
"Certification Parties") can reasonably rely. The Depositor shall serve as the
Certifying Person on behalf of the Trust. In the event that prior to the
filing date of the Form 10-K in March of each year, the Securities
Administrator or the Master Servicer has actual knowledge of information
material to the ▇▇▇▇▇▇▇▇-▇▇▇▇▇ Certification, the Securities Administrator or
the Master Servicer, as the case may be, shall promptly notify the Depositor.
The respective parties hereto agree to cooperate with all reasonable requests
made by any Certifying Person or Certification Party in connection with such
Person's attempt to conduct any due diligence that such Person reasonably
believes to be appropriate in order to allow it to deliver any ▇▇▇▇▇▇▇▇-▇▇▇▇▇
Certification or portion thereof with respect to the Trust Fund. In the event
the Master Servicer, the Securities Administrator or any Servicing Function
Participant engaged by parties is terminated or resigns pursuant to the terms
of this Agreement, or any applicable sub-servicing agreement, as the case may
be, such party shall provide a Back-Up Certification to the Certifying Person
pursuant to this Section 13.06 with respect to the period of time it was
subject to this Agreement or any applicable sub-servicing agreement, as the
case may be.
The Master Servicer shall enforce any obligation of the Servicers, to
the extent set forth in the related Servicing Agreement, to deliver to the
Master Servicer a certification similar to the Back-Up Certification within
the time frame set forth in, and in such form and substance as may be required
pursuant to, the related Servicing Agreement.
Section 13.07 Report on Assessment of Compliance and Attestation.
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(a) On or before March 15th of each calendar year:
(1) Each of the Master Servicer, the Securities Administrator and the
Custodians shall deliver to the Depositor and the Securities Administrator a
report regarding the Master Servicer's, the Securities Administrator's or
Custodians', as applicable, assessment of compliance with the Servicing
Criteria applicable to it during the immediately preceding calendar year, as
required under Rules 13a-18 and 15d-18 of the Exchange Act and Item 1122 of
Regulation AB; provided, however, the Securities Administrator and Custodians
shall deliver such report until the Trust fund is no longer reporting under
the Exchange Act after a Form 15 is filed pursuant to Section 13.06. Such
report shall be signed by an authorized officer of such Person and shall
address each of the Servicing Criteria applicable to it identified in Exhibit
K hereto delivered to the Depositor concurrently with the execution of this
Agreement. To the extent any of the Servicing Criteria so specified are not
applicable to such Person, with respect to asset-backed securities
transactions taken as a whole involving such Person and that are backed by the
same asset type backing the Certificates, such report shall include such a
statement to that effect. The Depositor and its respective officers and
directors shall be entitled to rely on upon each such servicing criteria
assessment.
(2) Each of the Master Servicer, the Securities Administrator and the
Custodians shall deliver to the Depositor, the Securities Administrator and
the Master Servicer a report of a registered public accounting firm that
attests to, and reports on, the assessment of compliance made by Master
Servicer, the Securities Administrator or the Custodians, as applicable, and
delivered pursuant to the preceding paragraphs. Such attestation shall be in
accordance with Rules 1-02(a)(3) and 2-02(g) of Regulation S-X under the
Securities Act and the Exchange Act, including, without limitation that in the
event that an overall opinion cannot be expressed, such registered public
accounting firm shall state in such report why it was unable to express such
an opinion. Such report must be available for general use and not contain
restricted use language. To the extent any of the Servicing Criteria are not
applicable to such Person, with respect to asset-backed securities
transactions taken as a whole involving such Person and that are backed by the
same asset type backing the Certificates, such report shall include such a
statement to that effect.
(3) The Master Servicer shall cause each Servicer and Reporting
Subcontractor to deliver to the Depositor an assessment of compliance and
accountant's attestation as and when provided in paragraphs (a) and (b) of
this Section 13.07.
(4) The Securities Administrator shall cause each Reporting
Subcontractor under its employ, if any, to deliver to the Depositor and the
Master Servicer an assessment of compliance and accountant's attestation as
and when provided in paragraphs (a) and (b) of this Section.
(b) Each assessment of compliance provided by the Securities
Administrator, the Master Servicer or the Custodians pursuant to Section
13.07(a)(2) shall address each of the Servicing Criteria applicable to it
specified on a Exhibit K hereto delivered to the Depositor concurrently with
the execution of this Agreement or, in the case of a securities administrator,
master servicer or custodian subsequently appointed as such, on or prior to
the date of such appointment. An assessment of compliance provided by a
Subcontractor pursuant to Section
127
13.07(a)(3) or (4) need not address any elements of the Servicing Criteria
other than those specified pursuant to Section 13.07(a)(1).
Section 13.08 Use of Subservicers and Subcontractors.
(a) The Master Servicer shall cause any subservicer used by the
Master Servicer and shall cause each Servicer to cause any subservicer used by
such servicer for the benefit of the Depositor to comply with the provisions
of this Article XIII to the same extent as if such Servicer or subservicer
were the Master Servicer (except with respect to the Master Servicer's duties
with respect to preparing and filing any Exchange Act Reports or as the
Certifying Person). The Master Servicer shall be responsible for obtaining
from each Servicer and subservicer and delivering to the Depositor any
servicer compliance statement required to be delivered by such Servicer or
subservicer pursuant to the second paragraph of Section 13.04, any assessment
of compliance and attestation required to be delivered by such Servicer or
subservicer under Section 13.07 and any certification required to be delivered
to the Certifying Person under Section 13.05 as and when required to be
delivered.
(b) It shall not be necessary for the Master Servicer, any Servicer,
any subservicer or the Securities Administrator to seek the consent of the
Depositor or any other party hereto to the utilization of any Subcontractor.
The Master Servicer or the Securities Administrator, as applicable, shall
promptly upon request provide to the Depositor (or any designee of the
Depositor, such as the Master Servicer or administrator) a written description
(in form and substance satisfactory to the Depositor) of the role and function
of each Subcontractor utilized by such Person (or in the case of the Master
Servicer, any Servicer or any subservicer), specifying (i) the identity of
each such Subcontractor, (ii) which (if any) of such Subcontractors are
"participating in the servicing function" within the meaning of Item 1122 of
Regulation AB, and (iii) which elements of the Servicing Criteria will be
addressed in assessments of compliance provided by each Subcontractor
identified pursuant to clause (ii) of this paragraph.
As a condition to the utilization of any Subcontractor determined to
be a Reporting Subcontractor, the Master Servicer or the Securities
Administrator, as applicable, shall cause any such Subcontractor used by such
Person (or in the case of the Master Servicer, any Servicer or any
subservicer) for the benefit of the Depositor to comply with the provisions of
Section 13.07 of this Agreement to the same extent as if such Subcontractor
were the Master Servicer (except with respect to the Master Servicer's duties
with respect to preparing and filing any Exchange Act Reports or as the
Certifying Person) or the Securities Administrator, as applicable. The Master
Servicer or the Securities Administrator, as applicable, shall be responsible
for obtaining from each Subcontractor and delivering to the Depositor and the
Master Servicer, any assessment of compliance and attestation required to be
delivered by such Subcontractor under Section 13.07, in each case as and when
required to be delivered.
* * * * * * *
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IN WITNESS WHEREOF, the parties hereto have caused their names to be
signed hereto by their respective officers thereunto duly authorized as of the
day and year first above written.
GS MORTGAGE SECURITIES CORP.
By: /s/ ▇▇▇▇▇▇▇ ▇▇▇▇
----------------------------------------
Name: ▇▇▇▇▇▇▇ ▇▇▇▇
Title: Vice President
U.S. BANK NATIONAL ASSOCIATION,
solely in its capacity as Trustee and a
Custodian and not in its individual capacity
By: /s/ ▇▇▇▇▇▇▇▇ ▇'▇▇▇▇
----------------------------------------
Name: ▇▇▇▇▇▇▇▇ ▇'▇▇▇▇
Title: Vice President
▇▇▇▇▇ FARGO BANK, NATIONAL ASSOCIATION,
as Master Servicer and Securities
Administrator
By: /s/ ▇▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇
----------------------------------------
Name: ▇▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇
Title: Vice President
[SIGNATURES CONTINUE]
Master Servicing and Trust Agreement
THE BANK OF NEW YORK TRUST COMPANY,
NATIONAL ASSOCIATION, as a Custodian
By: /s/ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇
----------------------------------------
Name: ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇
Title:
DEUTSCHE BANK NATIONAL TRUST COMPANY,
as a Custodian
By: /s/ ▇▇▇▇▇▇ ▇▇▇▇
----------------------------------------
Name: ▇▇▇▇▇▇ ▇▇▇▇
Title: Vice President
By: /s/ ▇▇▇▇▇ ▇▇▇▇▇▇
----------------------------------------
Name: ▇▇▇▇▇ ▇▇▇▇▇▇
Title: Vice President
Solely for purposes of Sections 9.03(b)
and 11.01 accepted and agreed to by:
AVELO MORTGAGE, L.L.C.
By: /s/ J. ▇▇▇▇▇▇ ▇▇▇▇▇▇▇
---------------------
Name: J. ▇▇▇▇▇▇ ▇▇▇▇▇▇▇
Title: Vice President
Master Servicing and Trust Agreement
SCHEDULE I
Mortgage Loan Schedule
[On File with the Securities Administrator as provided by the Depositor]
Sched. I-1
EXHIBIT A
FORM OF CLASS 1A1, CLASS 1A2, CLASS 2A1A, CLASS 2A1B, CLASS A4A, CLASS
A4B, CLASS M1, CLASS M2, CLASS M3, CLASS M4, CLASS M5, CLASS M6, CLASS
B1, CLASS B2 AND CLASS B3 CERTIFICATES
[To be added to the Class B3 Certificates while they remain non-investment
grade Certificates: IF THIS CERTIFICATE IS A PHYSICAL CERTIFICATE, NEITHER
THIS CERTIFICATE NOR ANY INTEREST HEREIN MAY BE TRANSFERRED UNLESS THE
PROPOSED TRANSFEROR DELIVERS TO THE SECURITIES ADMINISTRATOR A TRANSFEROR
CERTIFICATE (THE "TRANSFEROR CERTIFICATE") IN THE FORM OF EXHIBIT 1 TO THE
AGREEMENT REFERRED TO HEREIN AND EITHER (I) THE SECURITIES ADMINISTRATOR
RECEIVES A RULE 144A LETTER (THE "RULE 144A LETTER") IN THE FORM OF EXHIBIT H
TO THE AGREEMENT REFERRED TO HEREIN OR (II) THE SECURITIES ADMINISTRATOR
RECEIVES AN OPINION OF COUNSEL, DELIVERED AT THE EXPENSE OF THE TRANSFEROR,
THAT SUCH TRANSFER MAY BE MADE WITHOUT REGISTRATION UNDER THE SECURITIES ACT
OF 1933, AS AMENDED.]
IF THIS CERTIFICATE IS A BOOK-ENTRY CERTIFICATE, THE PROPOSED TRANSFEROR WILL
BE DEEMED TO HAVE MADE EACH OF THE CERTIFICATIONS SET FORTH IN THE TRANSFEROR
LETTER AND THE PROPOSED TRANSFEREE WILL BE DEEMED TO HAVE MADE EACH OF THE
CERTIFICATIONS SET FORTH IN THE RULE 144A LETTER, IN EACH CASE AS IF SUCH
CERTIFICATE WERE EVIDENCED BY A PHYSICAL CERTIFICATE.
[To be added to the Class B3 Certificates while they remain Private
Certificates: NEITHER THIS CERTIFICATE NOR ANY INTEREST HEREIN MAY BE
TRANSFERRED UNLESS THE TRANSFEREE DELIVERS TO THE SECURITIES ADMINISTRATOR
EITHER A REPRESENTATION LETTER TO THE EFFECT THAT SUCH TRANSFEREE IS NOT AN
EMPLOYEE BENEFIT PLAN SUBJECT TO TITLE I OF THE EMPLOYEE RETIREMENT INCOME
SECURITY ACT OF 1974, AS AMENDED ("ERISA"), OR A PLAN SUBJECT TO SECTION 4975
OF THE CODE, OR A PLAN SUBJECT TO APPLICABLE FEDERAL, STATE OR LOCAL LAW
("SIMILAR LAW") MATERIALLY SIMILAR TO THE FOREGOING PROVISIONS OF ERISA OR THE
CODE OR A PERSON INVESTING ON BEHALF OF OR WITH PLAN ASSETS OF SUCH A PLAN,
OR, IF THE TRANSFEREE IS AN INSURANCE COMPANY, A REPRESENTATION LETTER THAT IT
IS USING THE ASSETS OF ITS GENERAL ACCOUNT AND THAT THE PURCHASE AND HOLDING
OF THIS CERTIFICATE SATISFY THE REQUIREMENTS FOR EXEMPTIVE RELIEF UNDER
SECTIONS I AND III OF PROHIBITED TRANSACTION CLASS EXEMPTION 95-60, OR AN
OPINION OF COUNSEL SATISFACTORY TO THE TRUSTEE, THE SECURITIES ADMINISTRATOR
AND THE DEPOSITOR, TO THE EFFECT THAT THE PURCHASE AND HOLDING OF THIS
CERTIFICATE WILL NOT CONSTITUTE OR RESULT IN A NON-EXEMPT PROHIBITED
TRANSACTION WITHIN THE MEANING OF ERISA, SECTION 4975 OF THE CODE OR ANY
SIMILAR LAW AND WILL NOT SUBJECT THE DEPOSITOR, THE TRUSTEE, THE MASTER
SERVICER, THE SERVICERS OR THE SECURITIES ADMINISTRATOR TO ANY OBLIGATION IN
ADDITION TO THOSE
A-1
EXPRESSLY UNDERTAKEN IN THIS AGREEMENT OR TO ANY LIABILITY. NOTWITHSTANDING
ANYTHING ELSE TO THE CONTRARY HEREIN, ANY PURPORTED TRANSFER OF THIS
CERTIFICATE TO OR ON BEHALF OF AN EMPLOYEE BENEFIT PLAN SUBJECT TO TITLE I OF
ERISA, SECTION 4975 OF THE CODE OR SIMILAR LAW WITHOUT THE REPRESENTATION
LETTER OR OPINION OF COUNSEL SATISFACTORY TO THE SECURITIES ADMINISTRATOR,
TRUSTEE AND DEPOSITOR AS DESCRIBED ABOVE SHALL BE VOID AND OF NO EFFECT.]
IN THE EVENT THAT A TRANSFER OF A PRIVATE CERTIFICATE WHICH IS A BOOK-ENTRY
CERTIFICATE IS TO BE MADE IN RELIANCE UPON AN EXEMPTION FROM THE SECURITIES
ACT AND SUCH LAWS, IN ORDER TO ASSURE COMPLIANCE WITH THE SECURITIES ACT AND
SUCH LAWS, THE CERTIFICATEHOLDER DESIRING TO EFFECT SUCH TRANSFER WILL BE
DEEMED TO HAVE MADE AS OF THE TRANSFER DATE EACH OF THE CERTIFICATIONS SET
FORTH IN THE TRANSFEROR CERTIFICATE IN RESPECT OF SUCH CERTIFICATE AND THE
TRANSFEREE WILL BE DEEMED TO HAVE MADE AS OF THE TRANSFER DATE EACH OF THE
CERTIFICATIONS SET FORTH IN THE RULE 144A LETTER IN RESPECT OF SUCH
CERTIFICATE, IN EACH CASE AS IF SUCH CERTIFICATE WERE EVIDENCED BY A PHYSICAL
CERTIFICATE.
UNLESS THIS CERTIFICATE IS PRESENTED BY AN AUTHORIZED REPRESENTATIVE OF THE
DEPOSITORY TRUST COMPANY, A NEW YORK CORPORATION ("DTC"), TO ISSUER OR ITS
AGENT FOR REGISTRATION OF TRANSFER, EXCHANGE, OR PAYMENT, AND ANY CERTIFICATE
ISSUED IS REGISTERED IN THE NAME OF CEDE & CO. OR IN SUCH OTHER NAME AS IS
REQUESTED BY AN AUTHORIZED REPRESENTATIVE OF DTC (AND ANY PAYMENT IS MADE TO
CEDE & CO. OR TO SUCH OTHER ENTITY AS IS REQUESTED BY AN AUTHORIZED
REPRESENTATIVE OF DTC), ANY TRANSFER, PLEDGE, OR OTHER USE HEREOF FOR VALUE OR
OTHERWISE BY OR TO ANY PERSON IS WRONGFUL INASMUCH AS THE REGISTERED OWNER
HEREOF, CEDE & CO., HAS AN INTEREST HEREIN.
SOLELY FOR U.S. FEDERAL INCOME TAX PURPOSES, THIS CERTIFICATE REPRESENTS AN
INTEREST IN A "REGULAR INTEREST" IN A "REAL ESTATE MORTGAGE INVESTMENT
CONDUIT," AS THOSE TERMS ARE DEFINED, RESPECTIVELY, IN SECTIONS 860G AND 860D
OF THE INTERNAL REVENUE CODE OF 1986, AS AMENDED (THE "CODE"), AND CERTAIN
OTHER ASSETS.
[To be added to the Class B3 Certificates while they remain Private
Certificates: THIS CERTIFICATE HAS NOT BEEN REGISTERED UNDER THE SECURITIES
ACT OF 1933, AS AMENDED (THE "ACT"). ANY RESALE OR TRANSFER OF THIS
CERTIFICATE WITHOUT REGISTRATION THEREOF UNDER THE ACT MAY ONLY BE MADE IN A
TRANSACTION EXEMPTED FROM THE REGISTRATION REQUIREMENTS OF THE ACT AND IN
ACCORDANCE WITH THE PROVISIONS OF THE AGREEMENT REFERRED TO HEREIN.]
A-2
Certificate No. :
Cut-off Date : January 1, 2007
First Distribution Date : February 26, 2007
Initial Certificate Balance of
this Certificate
("Denomination") :
Initial Certificate Balances of
all Certificates of this Class : _______________ ______________
CUSIP :
ISIN :
A-3
GS MORTGAGE SECURITIES CORP.
GSAA Home Equity Trust 2007-1
Asset-Backed Certificates, Series 2007-1
[Class 1A1][Class 1A2][Class 2A1A][Class 2A1B][Class A4A][Class A4B]
[Class M1][Class M2][Class M3][Class M4][Class M5][Class M6]
[Class B1][Class B2][Class B3]
evidencing a percentage interest in the distributions allocable to
the Certificates of the above-referenced Class.
Principal in respect of this Certificate is distributable monthly as
set forth herein. Accordingly, the Certificate Balance at any time may be less
than the Certificate Balance as set forth herein. This Certificate does not
evidence an obligation of, or an interest in, and is not guaranteed by the
Depositor, the Master Servicer, the Securities Administrator or the Trustee
referred to below or any of their respective affiliates. Neither this
Certificate nor the Mortgage Loans are guaranteed or insured by any
governmental agency or instrumentality.
This certifies that CEDE & CO. is the registered owner of the
Percentage Interest evidenced by this Certificate (obtained by dividing the
denomination of this Certificate by the aggregate of the denominations of all
Certificates of the Class to which this Certificate belongs) in certain
monthly distributions pursuant to a Master Servicing and Trust Agreement dated
as of the Cut-off Date specified above (the "Agreement") among GS Mortgage
Securities Corp., as depositor (the "Depositor"), U.S. Bank National
Association, as trustee (the "Trustee") and as a custodian, ▇▇▇▇▇ Fargo Bank,
National Association, as Master Servicer (in such capacity, the "Master
Servicer"), and Securities Administrator (in such capacity, the "Securities
Administrator"), The Bank of New York Trust Company, National Association, as
a custodian and Deutsche Bank National Trust Company, as a custodian. To the
extent not defined herein, the capitalized terms used herein have the meanings
assigned in the Agreement. This Certificate is issued under and is subject to
the terms, provisions and conditions of the Agreement, to which Agreement the
Holder of this Certificate by virtue of the acceptance hereof assents and by
which such Holder is bound.
Reference is hereby made to the further provisions of this
Certificate set forth on the reverse hereof, which further provisions shall
for all purposes have the same effect as if set forth at this place.
This Certificate shall not be entitled to any benefit under the
Agreement or be valid for any purpose unless manually authenticated by an
authorized signatory of the Securities Administrator.
* * *
A-4
IN WITNESS WHEREOF, the Securities Administrator has caused this
Certificate to be duly executed.
Dated:
▇▇▇▇▇ FARGO BANK, NATIONAL ASSOCIATION,
not in its individual capacity, but
solely as Securities Administrator
By: _________________________________________
Authenticated:
By: _________________________________
Authorized Signatory of
▇▇▇▇▇ FARGO BANK, NATIONAL ASSOCIATION,
not in its individual capacity,
but solely as Securities Administrator
A-5
GS MORTGAGE SECURITIES CORP.
GSAA Home Equity Trust 2007-1
Asset-Backed Certificates
This Certificate is one of a duly authorized issue of Certificates
designated as GSAA Home Equity Trust 2007-1 Asset-Backed Certificates, of the
Series specified on the face hereof (herein collectively called the
"Certificates"), and representing a beneficial ownership interest in the Trust
Fund created by the Agreement.
The Certificateholder, by its acceptance of this Certificate, agrees
that it will look solely to the funds on deposit in the Distribution Account
for payment hereunder and that the Trustee is not liable to the
Certificateholders for any amount payable under this Certificate or the
Agreement or, except as expressly provided in the Agreement, subject to any
liability under the Agreement.
This Certificate does not purport to summarize the Agreement and
reference is made to the Agreement for the interests, rights and limitations
of rights, benefits, obligations and duties evidenced thereby, and the rights,
duties and immunities of the Trustee and the other parties to the Agreement.
Pursuant to the terms of the Agreement, a distribution will be made
on the 25th day of each month or, if such day is not a Business Day, the
Business Day immediately following (the "Distribution Date"), commencing on
the first Distribution Date specified on the face hereof, to the Person in
whose name this Certificate is registered at the close of business on the
applicable Record Date in an amount equal to the product of the Percentage
Interest evidenced by this Certificate and the amount required to be
distributed to Holders of Certificates of the Class to which this Certificate
belongs on such Distribution Date pursuant to the Agreement. The Record Date
for each Distribution Date is the last Business Day of the applicable Interest
Accrual Period for the related Distribution Date; provided, however, that for
any Definitive Certificates, the Record Date shall be the last Business Day of
the month immediately preceding the month of such Distribution Date.
Distributions on this Certificate shall be made by wire transfer of
immediately available funds to the account of the Holder hereof at a bank or
other entity having appropriate facilities therefor, if such Certificateholder
shall have so notified the Securities Administrator in writing at least five
(5) Business Days prior to the related Record Date and such Certificateholder
shall satisfy the conditions to receive such form of payment set forth in the
Agreement, or, if not, by check mailed by first class mail to the address of
such Certificateholder appearing in the Certificate Register. The final
distribution on each Certificate will be made in like manner, but only upon
presentment and surrender of such Certificate at the office designated by the
Securities Administrator for such purposes, or such other location specified
in the notice to Certificateholders of such final distribution.
The Agreement permits, with certain exceptions therein provided, the
amendment thereof and the modification of the rights and obligations of the
Trustee and the rights of the Certificateholders under the Agreement at any
time by the Depositor, the Trustee and the other
A-6
parties to the Agreement with the consent of the Holders of Certificates
affected by such amendment evidencing the requisite Percentage Interest, as
provided in the Agreement. Any such consent by the Holder of this Certificate
shall be conclusive and binding on such Holder and upon all future Holders of
this Certificate and of any Certificate issued upon the transfer hereof or in
exchange therefor or in lieu hereof whether or not notation of such consent is
made upon this Certificate. The Agreement also permits the amendment thereof,
in certain limited circumstances, without the consent of the Holders of any of
the Certificates.
As provided in the Agreement and subject to certain limitations
therein set forth, the transfer of this Certificate is registrable in the
Certificate Register of the Securities Administrator upon surrender of this
Certificate for registration of transfer at the office designated by the
Securities Administrator for such purposes, accompanied by a written
instrument of transfer in form satisfactory to the Securities Administrator
duly executed by the holder hereof or such holder's attorney duly authorized
in writing, and thereupon one or more new Certificates of the same Class in
authorized denominations and evidencing the same aggregate Percentage Interest
in the Trust Fund will be issued to the designated transferee or transferees.
The Certificates are issuable only as registered Certificates without
coupons in denominations specified in the Agreement. As provided in the
Agreement and subject to certain limitations therein set forth, Certificates
are exchangeable for new Certificates of the same Class in authorized
denominations and evidencing the same aggregate Percentage Interest, as
requested by the Holder surrendering the same.
No service charge will be made for any such registration of transfer
or exchange, but the Securities Administrator may require payment of a sum
sufficient to cover any tax or other governmental charge payable in connection
therewith.
The Trustee, the Depositor and the Securities Administrator and any
agent of the Trustee, the Depositor or the Securities Administrator may treat
the Person in whose name this Certificate is registered as the owner hereof
for all purposes, and none of the Depositor, the Trustee, the Securities
Administrator, nor any such agent shall be affected by any notice to the
contrary.
On any Distribution Date on which the aggregate Stated Principal
Balance of the Mortgage Loans is less than or equal to 10% of the Cut-off Date
Pool Principal Balance, the Person specified in Section 11.01 of the Agreement
will have the option to effectuate the purchase, in whole, from the Trust Fund
all remaining Mortgage Loans and all property acquired in respect of the
Mortgage Loans at a purchase price determined and in the manner as provided in
the Agreement. The obligations and responsibilities created by this Agreement
will terminate as provided in Section 11.01 of the Agreement.
Any term used herein that is defined in the Agreement shall have the
meaning assigned in the Agreement, and nothing herein shall be deemed
inconsistent with that meaning.
A-7
ASSIGNMENT
----------
the undersigned hereby sell(s), assign(s) and transfer(s) unto ______________
_____________________________________________________________________________
_____________________________________________________________________________
_____________________________________________________________________________
_____________________________________________________________________________
____________________________________________
(Please print or typewrite name and address including postal zip code of
assignee)
the Percentage Interest evidenced by the within Certificate and hereby
authorizes the transfer of registration of such Percentage Interest to
assignee on the Certificate Register of the Trust Fund.
I (We) further direct the Securities Administrator to issue a new
Certificate of a like denomination and Class, to the above named assignee and
deliver such Certificate to the following address:
_____________________________________________________________________________.
Dated:
______________________________________
Signature by or on behalf of assignor
A-8
DISTRIBUTION INSTRUCTIONS
-------------------------
The assignee should include the following for purposes of
distribution:
Distributions shall be made, by wire transfer or otherwise, in
immediately available funds to _______________________________________________,
______________________________________________________________________________,
for the account of ___________________________________________________________,
account number ______, or, if mailed by check, to ____________________________.
Applicable statements should be mailed to ____________________________________,
______________________________________________________________________________.
This information is provided by _____________________________________,
the assignee named above, or _________________________________________________,
as its agent.
A-9
EXHIBIT B
FORM OF CLASS P CERTIFICATE
NEITHER THIS CERTIFICATE NOR ANY INTEREST HEREIN MAY BE TRANSFERRED UNLESS THE
PROPOSED TRANSFEROR DELIVERS TO THE SECURITIES ADMINISTRATOR A TRANSFEROR
CERTIFICATE (THE "TRANSFEROR CERTIFICATE") IN THE FORM OF EXHIBIT H TO THE
AGREEMENT REFERRED TO HEREIN AND EITHER (I) THE SECURITIES ADMINISTRATOR
RECEIVES A RULE 144A LETTER IN THE FORM OF EXHIBIT I TO THE AGREEMENT REFERRED
TO HEREIN OR (II) THE SECURITIES ADMINISTRATOR RECEIVES AN OPINION OF COUNSEL,
DELIVERED AT THE EXPENSE OF THE TRANSFEROR, THAT SUCH TRANSFER MAY BE MADE
WITHOUT REGISTRATION UNDER THE SECURITIES ACT OF 1933, AS AMENDED.
NEITHER THIS CERTIFICATE NOR ANY INTEREST HEREIN MAY BE TRANSFERRED UNLESS THE
TRANSFEREE DELIVERS TO THE SECURITIES ADMINISTRATOR EITHER A REPRESENTATION
LETTER TO THE EFFECT THAT SUCH TRANSFEREE IS NOT AN EMPLOYEE BENEFIT PLAN
SUBJECT TO TITLE I OF THE EMPLOYEE RETIREMENT INCOME SECURITY ACT OF 1974, AS
AMENDED ("ERISA"), OR A PLAN SUBJECT TO SECTION 4975 OF THE CODE, OR A PLAN
SUBJECT TO APPLICABLE FEDERAL, STATE OR LOCAL LAW ("SIMILAR LAW") MATERIALLY
SIMILAR TO THE FOREGOING PROVISIONS OF ERISA OR THE CODE OR A PERSON INVESTING
ON BEHALF OF OR WITH PLAN ASSETS OF SUCH A PLAN, OR IF THE TRANSFEREE IS AN
INSURANCE COMPANY AND THE CERTIFICATE HAS BEEN THE SUBJECT OF AN
ERISA-QUALIFYING UNDERWRITING, A REPRESENTATION LETTER THAT IT IS USING THE
ASSETS OF ITS GENERAL ACCOUNT AND THAT THE PURCHASE AND HOLDING OF THIS
CERTIFICATE SATISFY THE REQUIREMENTS FOR EXEMPTIVE RELIEF UNDER SECTIONS I AND
III OF PROHIBITED TRANSACTION CLASS EXEMPTION 95-60, OR AN OPINION OF COUNSEL
SATISFACTORY TO THE TRUSTEE, THE SECURITIES ADMINISTRATOR AND THE DEPOSITOR,
TO THE EFFECT THAT THE PURCHASE AND HOLDING OF THIS CERTIFICATE WILL NOT
CONSTITUTE OR RESULT IN A NON-EXEMPT PROHIBITED TRANSACTION WITHIN THE MEANING
OF ERISA, SECTION 4975 OF THE CODE OR ANY SIMILAR LAW AND WILL NOT SUBJECT THE
TRUSTEE, THE MASTER SERVICER, THE DEPOSITOR OR THE SECURITIES ADMINISTRATOR TO
ANY OBLIGATION IN ADDITION TO THOSE EXPRESSLY UNDERTAKEN IN THIS AGREEMENT OR
TO ANY LIABILITY. NOTWITHSTANDING ANYTHING ELSE TO THE CONTRARY HEREIN, ANY
PURPORTED TRANSFER OF THIS CERTIFICATE TO OR ON BEHALF OF AN EMPLOYEE BENEFIT
PLAN SUBJECT TO TITLE I OF ERISA, SECTION 4975 OF THE CODE OR SIMILAR LAW
WITHOUT THE REPRESENTATION LETTER OR OPINION OF COUNSEL SATISFACTORY TO THE
SECURITIES ADMINISTRATOR AS DESCRIBED ABOVE SHALL BE VOID AND OF NO EFFECT.
B-1
Certificate No. : 1
Cut off Date : January 1, 2007
First Distribution Date : February 26, 2007
Notional Certificate Balance
of this Certificate : $100
Percentage Interest of this
Certificate ("Denomination") : [_____]%
CUSIP :
ISIN :
B-2
GS MORTGAGE SECURITIES CORP.
GSAA Home Equity Trust 2007-1
Asset-Backed Certificates, Series 2007-1
Class P
evidencing a percentage interest in the distributions allocable
to the Certificates of the above referenced Class.
Distributions in respect of this Certificate are distributable
monthly as set forth herein. This Certificate does not evidence an obligation
of, or an interest in, and is not guaranteed by the Depositor, the Master
Servicer, the Securities Administrator or the Trustee referred to below or any
of their respective affiliates. Neither this Certificate nor the Mortgage
Loans are guaranteed or insured by any governmental agency or instrumentality.
This certifies that Cede & Co. is the registered owner of the
Percentage Interest evidenced by this Certificate (obtained by dividing the
denomination of this Certificate by the aggregate of the denominations of all
Certificates of the Class to which this Certificate belongs) in certain
monthly distributions pursuant to a Master Servicing and Trust Agreement dated
as of the Cut-off Date specified above (the "Agreement") among GS Mortgage
Securities Corp., as depositor (the "Depositor"), U.S. Bank National
Association, as trustee (the "Trustee") and as a custodian, ▇▇▇▇▇ Fargo Bank,
National Association, as Master Servicer (in such capacity, the "Master
Servicer") and Securities Administrator (in such capacity, the "Securities
Administrator"), The Bank of New York Trust Company, National Association, as
a custodian and Deutsche Bank National Trust Company, as a custodian. To the
extent not defined herein, the capitalized terms used herein have the meanings
assigned in the Agreement. This Certificate is issued under and is subject to
the terms, provisions and conditions of the Agreement, to which Agreement the
Holder of this Certificate by virtue of the acceptance hereof assents and by
which such Holder is bound.
This Certificate does not have a Pass-Through Rate and will be
entitled to distributions only to the extent set forth in the Agreement. In
addition, any distribution of the proceeds of any remaining assets of the
Trust will be made only upon presentment and surrender of this Certificate at
the office designated by the Securities Administrator for such purposes or the
office or agency maintained by the Securities Administrator.
No transfer of a Certificate of this Class shall be made unless such
disposition is exempt from the registration requirements of the Securities Act
of 1933, as amended (the "1933 Act"), and any applicable state securities laws
or is made in accordance with the 1933 Act and such laws. In the event of any
such transfer, the Securities Administrator shall require the transferor to
execute a transferor certificate (in substantially the form attached to the
Agreement) and deliver either (i) a Rule 144A Letter, (in substantially the
form attached to the Agreement), or (ii) a written Opinion of Counsel to the
Securities Administrator that such transfer may be made pursuant to an
exemption, describing the applicable exemption and the basis therefor, from
the 1933 Act or is being made pursuant to the 1933 Act, which Opinion of
Counsel shall be an
B-3
expense of the transferor. No transfer of a Certificate of
this Class shall be made unless the Securities Administrator shall have
received either (i) a representation letter from the transferee of such
Certificate, acceptable to and in form and substance satisfactory to the
Securities Administrator, to the effect that such transferee is not an
employee benefit plan subject to Section 406 of ERISA or Section 4975 of the
Code or any materially similar provisions of applicable federal, state or
local law ("Similar Law") or a person acting on behalf of or investing plan
assets of any such plan, which representation letter shall not be an expense
of the Securities Administrator, or (ii) if the transferee is an insurance
company and the certificate has been the subject of an ERISA-Qualifying
Underwriting, a representation letter that it is purchasing such Certificates
with the assets of its general account and that the purchase and holding of
such Certificates satisfy the requirements for exemptive relief under Sections
I and III of PTCE 95-60, or (iii) in the case of a Certificate presented for
registration in the name of an employee benefit plan subject to ERISA, or a
plan or arrangement subject to Section 4975 of the Code (or comparable
provisions of any subsequent enactments) or a plan subject to Similar Law, or
a trustee of any such plan or any other person acting on behalf of any such
plan or arrangement or using such plan's or arrangement's assets, an Opinion
of Counsel satisfactory to the Securities Administrator, which Opinion of
Counsel shall not be an expense of the Securities Administrator, the
Depositor, the Trustee or the Trust Fund, addressed to the Securities
Administrator, the Trustee and the Depositor to the effect that the purchase
and holding of such Certificate will not constitute or result in a non-exempt
prohibited transaction within the meaning of ERISA, Section 4975 of the Code
or any Similar Law and will not subject the Trustee to any obligation in
addition to those expressly undertaken in this Agreement or to any liability.
Reference is hereby made to the further provisions of this
Certificate set forth on the reverse hereof, which further provisions shall
for all purposes have the same effect as if set forth at this place.
This Certificate shall not be entitled to any benefit under the
Agreement or be valid for any purpose unless manually authenticated by an
authorized signatory of the Securities Administrator.
* * *
B-4
IN WITNESS WHEREOF, the Securities Administrator has caused this
Certificate to be duly executed.
Dated:
▇▇▇▇▇ FARGO BANK, NATIONAL ASSOCIATION,
not in its individual capacity, but
solely as Securities Administrator
By: _________________________________________
Authenticated:
By: _________________________________
Authorized Signatory of
▇▇▇▇▇ FARGO BANK, NATIONAL ASSOCIATION,
not in its individual capacity,
but solely as Securities Administrator
B-5
GS MORTGAGE SECURITIES CORP.
GSAA Home Equity Trust 2007-1
Asset-Backed Certificates
This Certificate is one of a duly authorized issue of Certificates
designated as GSAA Home Equity Trust 2007-1 Asset-Backed Certificates, of the
Series specified on the face hereof (herein collectively called the
"Certificates"), and representing a beneficial ownership interest in the Trust
Fund created by the Agreement.
The Certificateholder, by its acceptance of this Certificate, agrees
that it will look solely to the funds on deposit in the Distribution Account
for payment hereunder and that the Trustee is not liable to the
Certificateholders for any amount payable under this Certificate or the
Agreement or, except as expressly provided in the Agreement, subject to any
liability under the Agreement.
This Certificate does not purport to summarize the Agreement and
reference is made to the Agreement for the interests, rights and limitations
of rights, benefits, obligations and duties evidenced thereby, and the rights,
duties and immunities of the Trustee and the other parties to the Agreement.
Pursuant to the terms of the Agreement, a distribution will be made
on the 25th day of each month or, if such 25th day is not a Business Day, the
Business Day immediately following (the "Distribution Date"), commencing on
the first Distribution Date specified on the face hereof, to the Person in
whose name this Certificate is registered at the close of business on the
applicable Record Date in an amount equal to the product of the Percentage
Interest evidenced by this Certificate and the amount required to be
distributed to Holders of Certificates of the Class to which this Certificate
belongs on such Distribution Date pursuant to the Agreement. The Record Date
for each Distribution Date is the last Business Day of the month immediately
preceding the month in which such Distribution Date occurs.
Distributions on this Certificate shall be made by wire transfer of
immediately available funds to the account of the Holder hereof at a bank or
other entity having appropriate facilities therefor, if such Certificateholder
shall have so notified the Securities Administrator in writing at least five
(5) Business Days prior to the related Record Date and such Certificateholder
shall satisfy the conditions to receive such form of payment set forth in the
Agreement, or, if not, by check mailed by first class mail to the address of
such Certificateholder appearing in the Certificate Register. The final
distribution on each Certificate will be made in like manner, but only upon
presentment and surrender of such Certificate at the office designated by the
Securities Administrator for such purposes or such other location specified in
the notice to Certificateholders of such final distribution.
The Agreement permits, with certain exceptions therein provided, the
amendment thereof and the modification of the rights and obligations of the
Trustee and the rights of the Certificateholders under the Agreement at any
time by the Trustee and the other parties to the Agreement with the consent of
the Holders of Certificates affected by such amendment evidencing the
requisite Percentage Interest, as provided in the Agreement. Any such consent
by
B-6
the Holder of this Certificate shall be conclusive and binding on such Holder
and upon all future Holders of this Certificate and of any Certificate issued
upon the transfer hereof or in exchange therefor or in lieu hereof whether or
not notation of such consent is made upon this Certificate. The Agreement also
permits the amendment thereof, in certain limited circumstances, without the
consent of the Holders of any of the Certificates.
As provided in the Agreement and subject to certain limitations
therein set forth, the transfer of this Certificate is registrable in the
Certificate Register of the Securities Administrator upon surrender of this
Certificate for registration of transfer at the office designated by the
Securities Administrator for such purposes, accompanied by a written
instrument of transfer in form satisfactory to the Securities Administrator
duly executed by the holder hereof or such holder's attorney duly authorized
in writing, and thereupon one or more new Certificates of the same Class in
authorized denominations and evidencing the same aggregate Percentage Interest
in the Trust Fund will be issued to the designated transferee or transferees.
The Certificates are issuable only as registered Certificates without
coupons in denominations specified in the Agreement. As provided in the
Agreement and subject to certain limitations therein set forth, Certificates
are exchangeable for new Certificates of the same Class in authorized
denominations and evidencing the same aggregate Percentage Interest, as
requested by the Holder surrendering the same.
No service charge will be made for any such registration of transfer
or exchange, but the Securities Administrator may require payment of a sum
sufficient to cover any tax or other governmental charge payable in connection
therewith.
The Trustee, the Depositor and the Securities Administrator and any
agent of the Trustee, the Depositor or the Securities Administrator may treat
the Person in whose name this Certificate is registered as the owner hereof
for all purposes, and none of the Trustee, the Depositor, the Securities
Administrator, nor any such agent shall be affected by any notice to the
contrary.
On any Distribution Date on which the aggregate Stated Principal
Balance of the Mortgage Loans is less than or equal to 10% of the Cut-off Date
Pool Principal Balance, the Person specified in Section 11.01 of the Agreement
will have the option to effectuate the purchase, in whole, from the Trust Fund
all remaining Mortgage Loans and all property acquired in respect of the
Mortgage Loans at a purchase price determined and in the manner as provided in
the Agreement. The obligations and responsibilities created by this Agreement
will terminate as provided in Section 11.01 of the Agreement.
Any term used herein that is defined in the Agreement shall have the
meaning assigned in the Agreement, and nothing herein shall be deemed
inconsistent with that meaning.
B-7
ASSIGNMENT
----------
FOR VALUE RECEIVED, the undersigned hereby sell(s), assign(s) and
transfer(s) unto _____________________________________________________________
______________________________________________________________________________
______________________________________________________________________________
______________________________________________________________________________
______________________________________________________________________________
(Please print or typewrite name and address including postal zip code of
assignee)
the Percentage Interest evidenced by the within Certificate and hereby
authorizes the transfer of registration of such Percentage Interest to
assignee on the Certificate Register of the Trust Fund.
I (We) further direct the Securities Administrator to issue a new
Certificate of a like denomination and Class, to the above named assignee and
deliver such Certificate to the following address:
_____________________________________________________________________________.
Dated:
______________________________________
Signature by or on behalf of assignor
B-8
DISTRIBUTION INSTRUCTIONS
-------------------------
The assignee should include the following for purposes of
distribution:
Distributions shall be made, by wire transfer or otherwise, in
immediately available funds to ______________________________________________,
_____________________________________________________________________________,
for the account of __________________________________________________________,
account number ______, or, if mailed by check, to ___________________________,
Applicable statements should be mailed to ___________________________________,
_____________________________________________________________________________.
This information is provided by ____________________________________,
the assignee named above, or ________________________________________________,
as its agent.
B-9
EXHIBIT C
FORM OF CLASS R, CLASS RC AND CLASS RX 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, AS AMENDED (THE "CODE").
NEITHER THIS CERTIFICATE NOR ANY INTEREST HEREIN MAY BE TRANSFERRED UNLESS THE
PROPOSED TRANSFEREE DELIVERS TO THE SECURITIES ADMINISTRATOR A TRANSFER
AFFIDAVIT IN ACCORDANCE WITH THE PROVISIONS OF THE AGREEMENT REFERRED TO
HEREIN.
NEITHER THIS CERTIFICATE NOR ANY INTEREST HEREIN MAY BE TRANSFERRED UNLESS THE
TRANSFEREE DELIVERS TO THE SECURITIES ADMINISTRATOR A REPRESENTATION LETTER TO
THE EFFECT THAT SUCH TRANSFEREE IS AN EMPLOYEE BENEFIT PLAN SUBJECT TO THE
EMPLOYEE RETIREMENT INCOME SECURITY ACT OF 1974, AS AMENDED ("ERISA"), OR A
PLAN SUBJECT TO SECTION 4975 OF THE CODE OR A PLAN SUBJECT TO MATERIALLY
SIMILAR PROVISIONS OF APPLICABLE FEDERAL, STATE OR LOCAL LAW ("SIMILAR LAW")
OR A PERSON INVESTING ON BEHALF OF OR WITH PLAN ASSETS OF SUCH A PLAN, OR AN
OPINION OF COUNSEL AS DESCRIBED IN THE AGREEMENT. IN THE EVENT THAT SUCH
REPRESENTATION IS VIOLATED, OR ANY ATTEMPT IS MADE TO TRANSFER TO A PLAN OR
ARRANGEMENT SUBJECT TO SECTION 406 OF ERISA, A PLAN SUBJECT TO SECTION 4975 OF
THE CODE OR A PLAN SUBJECT TO SIMILAR LAW, OR A PERSON ACTING ON BEHALF OF ANY
SUCH PLAN OR ARRANGEMENT OR USING THE ASSETS OF ANY SUCH PLAN OR ARRANGEMENT
WITHOUT AN OPINION OF COUNSEL AS DESCRIBED IN THE AGREEMENT, SUCH ATTEMPTED
TRANSFER OR ACQUISITION SHALL BE VOID AND OF NO EFFECT.
Certificate No. : [R][RC][RX]
Cut off Date : January 1, 2007
First Distribution Date : February 26, 2007
Initial Certificate Balance of this
Certificate ("Denomination") : $100
Initial Certificate Balance of all
Certificates of this Class: : $100
CUSIP :
ISIN :
C-1
GS MORTGAGE SECURITIES CORP.
GSAA Home Equity Trust 2007-1
Asset Backed Certificates, Series 2007-1
Class [R][RC][RX]
evidencing a percentage interest in the distributions allocable to
the Certificates of the above referenced Class.
Principal in respect of this Certificate is distributable monthly as
set forth herein. Accordingly, the Certificate Balance at any time may be less
than the Certificate Balance as set forth herein. This Certificate does not
evidence an obligation of, or an interest in, and is not guaranteed by the
Depositor, the Master Servicer, the Securities Administrator or the Trustee
referred to below or any of their respective affiliates. Neither this
Certificate nor the Mortgage Loans are guaranteed or insured by any
governmental agency or instrumentality.
This certifies that [____________] is the registered owner of the
Percentage Interest specified above of any monthly distributions due to the
Class [R][RC][RX] Certificates pursuant to a Master Servicing and Trust
Agreement dated as of the Cut-off Date specified above (the "Agreement") among
GS Mortgage Securities Corp., as depositor (the "Depositor"), U.S. Bank
National Association, as trustee (the "Trustee") and as a custodian, ▇▇▇▇▇
Fargo Bank, National Association, as Master Servicer (in such capacity, the
"Master Servicer") and Securities Administrator (in such capacity, the
"Securities Administrator"), The Bank of New York Trust Company, National
Association, as a custodian and Deutsche Bank National Trust Company, as a
custodian. To the extent not defined herein, the capitalized terms used herein
have the meanings assigned in the Agreement. This Certificate is issued under
and is subject to the terms, provisions and conditions of the Agreement, to
which Agreement the Holder of this Certificate by virtue of the acceptance
hereof assents and by which such Holder is bound.
Any distribution of the proceeds of any remaining assets of the Trust
Fund will be made only upon presentment and surrender of this Class
[R][RC][RX] Certificate at the office designated by the Securities
Administrator for such purposes.
No transfer of a Class [R][RC][RX] Certificate shall be made unless
the Securities Administrator shall have received a representation letter from
the transferee of such Certificate, acceptable to and in form and substance
satisfactory to the Securities Administrator, to the effect that such
transferee is not an employee benefit plan or arrangement subject to Section
406 of ERISA, a plan or arrangement subject to Section 4975 of the Code or a
plan subject to Similar Law, or a person acting on behalf of any such plan or
arrangement or using the assets of any such plan or arrangement to effect such
transfer, which representation letter shall not be an expense of the
Securities Administrator or the Trust Fund, or, alternatively, an opinion of
counsel as described in the Agreement. In the event that such representation
is violated, or any attempt is made to transfer to a plan or arrangement
subject to Section 406 of ERISA or a plan subject to Section 4975 of the Code
or a plan subject to Similar Law, or a person acting on behalf of any such
plan or arrangement or using the assets of any such plan or arrangement,
without an opinion
C-2
of counsel as described in the Agreement, such attempted transfer or
acquisition shall be void and of no effect.
Each Holder of this Class [R][RC][RX] Certificate shall be deemed by
the acceptance or acquisition an Ownership Interest in this Class [R][RC][RX]
Certificate to have agreed to be bound by the following provisions, and the
rights of each Person acquiring any Ownership Interest in this Class
[R][RC][RX] Certificate are expressly subject to the following provisions: (i)
each Person holding or acquiring any Ownership Interest in this Class
[R][RC][RX] Certificate shall be a Permitted Transferee and shall promptly
notify the Securities Administrator of any change or impending change in its
status as a Permitted Transferee, (ii) no Ownership Interest in this Class
[R][RC][RX] Certificate may be registered on the Closing Date or thereafter
transferred, and the Securities Administrator shall not register the Transfer
of this Certificate unless, in addition to the certificates required to be
delivered to the Securities Administrator under Section 5.02(b) of the
Agreement, the Securities Administrator shall have been furnished with a
Transfer Affidavit of the initial owner or the proposed transferee in the form
attached as Exhibit G to the Agreement, (iii) each Person holding or acquiring
any Ownership Interest in this Class [R][RC][RX] Certificate shall agree (A)
to obtain a Transfer Affidavit from any other Person to whom such Person
attempts to Transfer its Ownership Interest this Class [R][RC][RX]
Certificate, (B) to obtain a Transfer Affidavit from any Person for whom such
Person is acting as nominee, trustee or agent in connection with any Transfer
of this Class [R][RC][RX] Certificate, (C) not to cause income with respect to
the Class [R][RC][RX] Certificate to be attributable to a foreign permanent
establishment or fixed base, within the meaning of an applicable income tax
treaty, of such Person or any other U.S. Person and (D) not to Transfer the
Ownership Interest in this Class [R][RC][RX] Certificate or to cause the
Transfer of the Ownership Interest in this Class [R][RC][RX] Certificate to
any other Person if it has actual knowledge that such Person is not a
Permitted Transferee and (iv) any attempted or purported Transfer of the
Ownership Interest in this Class [R][RC][RX] Certificate in violation of the
provisions herein shall be absolutely null and void and shall vest no rights
in the purported Transferee.
Reference is hereby made to the further provisions of this
Certificate set forth on the reverse hereof, which further provisions shall
for all purposes have the same effect as if set forth at this place.
This Certificate shall not be entitled to any benefit under the
Agreement or be valid for any purpose unless manually authenticated by an
authorized signatory of the Securities Administrator.
C-3
IN WITNESS WHEREOF, the Securities Administrator has caused this
Certificate to be duly executed.
Dated:
▇▇▇▇▇ FARGO BANK, NATIONAL ASSOCIATION,
not in its individual capacity, but
solely as Securities Administrator
By: _________________________________________
Authenticated:
By: _________________________________
Authorized Signatory of
▇▇▇▇▇ FARGO BANK, NATIONAL ASSOCIATION,
not in its individual capacity,
but solely as Securities Administrator
C-4
GS MORTGAGE SECURITIES CORP.
GSAA Home Equity Trust 2007-1
Asset Backed Certificates
This Certificate is one of a duly authorized issue of Certificates
designated as GSAA Home Equity Trust 2007-1 Asset Backed Certificates, of the
Series specified on the face hereof (herein collectively called the
"Certificates"), and representing a beneficial ownership interest in the Trust
Fund created by the Agreement.
The Certificateholder, by its acceptance of this Certificate, agrees
that it will look solely to the funds on deposit in the Distribution Account
for payment hereunder and that the Trustee is not liable to the
Certificateholders for any amount payable under this Certificate or the
Agreement or, except as expressly provided in the Agreement, subject to any
liability under the Agreement.
This Certificate does not purport to summarize the Agreement and
reference is made to the Agreement for the interests, rights and limitations
of rights, benefits, obligations and duties evidenced thereby, and the rights,
duties and immunities of the Trustee and the other parties to the Agreement.
Pursuant to the terms of the Agreement, a distribution will be made
on the 25th day of each month or, if such day is not a Business Day, the
Business Day immediately following (the "Distribution Date"), commencing on
the first Distribution Date specified on the face hereof, to the Person in
whose name this Certificate is registered at the close of business on the
applicable Record Date in an amount equal to the product of the Percentage
Interest evidenced by this Certificate and the amount required to be
distributed to Holders of Certificates of the Class to which this Certificate
belongs on such Distribution Date pursuant to the Agreement. The Record Date
for each Distribution Date is the last Business Day of the month immediately
preceding the month in which such Distribution Date occurs.
Distributions on this Certificate shall be made by wire transfer of
immediately available funds to the account of the Holder hereof at a bank or
other entity having appropriate facilities therefor, if such Certificateholder
shall have so notified the Securities Administrator in writing at least five
(5) Business Days prior to the related Record Date and such Certificateholder
shall satisfy the conditions to receive such form of payment set forth in the
Agreement, or, if not, by check mailed by first class mail to the address of
such Certificateholder appearing in the Certificate Register. The final
distribution on each Certificate will be made in like manner, but only upon
presentment and surrender of such Certificate at the office designated by the
Securities Administrator for such purposes, or such other location specified
in the notice to Certificateholders of such final distribution.
The Agreement permits, with certain exceptions therein provided, the
amendment thereof and the modification of the rights and obligations of the
Trustee and the rights of the Certificateholders under the Agreement at any
time by the Depositor, the Trustee and the other parties to the Agreement with
the consent of the Holders of Certificates affected by such amendment
evidencing the requisite Percentage Interest, as provided in the Agreement.
Any
C-5
such consent by the Holder of this Certificate shall be conclusive and binding
on such Holder and upon all future Holders of this Certificate and of any
Certificate issued upon the transfer hereof or in exchange therefor or in lieu
hereof whether or not notation of such consent is made upon this Certificate.
The Agreement also permits the amendment thereof, in certain limited
circumstances, without the consent of the Holders of any of the Certificates.
As provided in the Agreement and subject to certain limitations
therein set forth, the transfer of this Certificate is registrable in the
Certificate Register of the Securities Administrator upon surrender of this
Certificate for registration of transfer at the office designated by the
Securities Administrator for such purposes, accompanied by a written
instrument of transfer in form satisfactory to the Securities Administrator
duly executed by the holder hereof or such holder's attorney duly authorized
in writing, and thereupon one or more new Certificates of the same Class in
authorized denominations and evidencing the same aggregate Percentage Interest
in the Trust Fund will be issued to the designated transferee or transferees.
The Certificates are issuable only as registered Certificates without
coupons in denominations specified in the Agreement. As provided in the
Agreement and subject to certain limitations therein set forth, Certificates
are exchangeable for new Certificates of the same Class in authorized
denominations and evidencing the same aggregate Percentage Interest, as
requested by the Holder surrendering the same.
No service charge will be made for any such registration of transfer
or exchange, but the Securities Administrator may require payment of a sum
sufficient to cover any tax or other governmental charge payable in connection
therewith.
The Trustee, the Depositor, the Securities Administrator and any
agent of the Trustee, the Depositor or the Securities Administrator may treat
the Person in whose name this Certificate is registered as the owner hereof
for all purposes, and none of the Depositor, the Trustee or Securities
Administrator, nor any such agent shall be affected by any notice to the
contrary.
On any Distribution Date on which the aggregate Stated Principal
Balance of the Mortgage Loans is less than or equal to 10% of the Cut-off Date
Pool Principal Balance, the Person specified in Section 11.01 of the Agreement
will have the option to effectuate the purchase, in whole, from the Trust Fund
all remaining Mortgage Loans and all property acquired in respect of the
Mortgage Loans at a purchase price determined and in the manner as provided in
the Agreement. The obligations and responsibilities created by this Agreement
will terminate as provided in Section 11.01 of the Agreement.
Any term used herein that is defined in the Agreement shall have the
meaning assigned in the Agreement, and nothing herein shall be deemed
inconsistent with that meaning.
C-6
ASSIGNMENT
----------
FOR VALUE RECEIVED, the undersigned hereby sell(s), assign(s) and
transfer(s) unto _____________________________________________________________
______________________________________________________________________________
______________________________________________________________________________
______________________________________________________________________________
______________________________________________________________________________
(Please print or typewrite name and address including postal zip code of
assignee)
the Percentage Interest evidenced by the within Certificate and hereby
authorizes the transfer of registration of such Percentage Interest to
assignee on the Certificate Register of the Trust Fund.
I (We) further direct the Securities Administrator to issue a new
Certificate of a like denomination and Class, to the above named assignee and
deliver such Certificate to the following address:
______________________________________________________________________________.
Dated:
______________________________________
Signature by or on behalf of assignor
C-7
DISTRIBUTION INSTRUCTIONS
-------------------------
The assignee should include the following for purposes of
distribution:
Distributions shall be made, by wire transfer or otherwise, in
immediately available funds to ______________________________________________,
_____________________________________________________________________________,
for the account of __________________________________________________________,
account number ______, or, if mailed by check, to ___________________________,
Applicable statements should be mailed to ___________________________________,
_____________________________________________________________________________.
This information is provided by ____________________________________,
the assignee named above, or_________________________________________________,
as its agent.
C-8
EXHIBIT D
FORM OF CLASS X CERTIFICATE
SOLELY FOR U.S. FEDERAL INCOME TAX PURPOSES, THIS CERTIFICATE REPRESENTS A
"REGULAR INTEREST" IN A "REAL ESTATE MORTGAGE INVESTMENT CONDUIT," AS THOSE
TERMS ARE DEFINED, RESPECTIVELY, IN SECTIONS 860G AND 860D OF THE INTERNAL
REVENUE CODE OF 1986, AS AMENDED (THE "CODE") AND CERTAIN OTHER ASSETS
NEITHER THIS CERTIFICATE NOR ANY INTEREST HEREIN MAY BE TRANSFERRED UNLESS THE
PROPOSED TRANSFEROR DELIVERS TO THE SECURITIES ADMINISTRATOR A TRANSFEROR
CERTIFICATE (THE "TRANSFEROR CERTIFICATE") IN THE FORM OF EXHIBIT H TO THE
AGREEMENT REFERRED TO HEREIN AND EITHER (I) THE SECURITIES ADMINISTRATOR
RECEIVES A RULE 144A LETTER (THE "RULE 144A LETTER") IN THE FORM OF EXHIBIT I
TO THE AGREEMENT REFERRED TO HEREIN OR (II) THE SECURITIES ADMINISTRATOR
RECEIVES AN OPINION OF COUNSEL, DELIVERED AT THE EXPENSE OF THE TRANSFEROR,
THAT SUCH TRANSFER MAY BE MADE WITHOUT REGISTRATION UNDER THE SECURITIES ACT
OF 1933, AS AMENDED.
NEITHER THIS CERTIFICATE NOR ANY INTEREST HEREIN MAY BE TRANSFERRED UNLESS THE
TRANSFEREE DELIVERS TO THE SECURITIES ADMINISTRATOR EITHER A REPRESENTATION
LETTER TO THE EFFECT THAT SUCH TRANSFEREE IS NOT AN EMPLOYEE BENEFIT PLAN
SUBJECT TO TITLE I OF THE EMPLOYEE RETIREMENT INCOME SECURITY ACT OF 1974, AS
AMENDED ("ERISA"), OR A PLAN SUBJECT TO SECTION 4975 OF THE CODE, OR A PLAN
SUBJECT TO APPLICABLE FEDERAL, STATE OR LOCAL LAW ("SIMILAR LAW") MATERIALLY
SIMILAR TO THE FOREGOING PROVISIONS OF ERISA OR THE CODE OR A PERSON INVESTING
ON BEHALF OF OR WITH PLAN ASSETS OF SUCH A PLAN, OR IF THE TRANSFEREE IS AN
INSURANCE COMPANY AND THE CERTIFICATE HAS BEEN THE SUBJECT OF AN
ERISA-QUALIFYING UNDERWRITING, A REPRESENTATION LETTER THAT IT IS USING THE
ASSETS OF ITS GENERAL ACCOUNT AND THAT THE PURCHASE AND HOLDING OF THIS
CERTIFICATE SATISFY THE REQUIREMENTS FOR EXEMPTIVE RELIEF UNDER SECTIONS I AND
III OF PROHIBITED TRANSACTION CLASS EXEMPTION 95-60, OR AN OPINION OF COUNSEL
SATISFACTORY TO THE TRUSTEE, THE SECURITIES ADMINISTRATOR AND THE DEPOSITOR,
TO THE EFFECT THAT THE PURCHASE AND HOLDING OF THIS CERTIFICATE WILL NOT
CONSTITUTE OR RESULT IN A NON-EXEMPT PROHIBITED TRANSACTION WITHIN THE MEANING
OF ERISA, SECTION 4975 OF THE CODE OR ANY SIMILAR LAW AND WILL NOT SUBJECT THE
TRUSTEE, THE MASTER SERVICER, THE DEPOSITOR OR THE SECURITIES ADMINISTRATOR TO
ANY OBLIGATION IN ADDITION TO THOSE EXPRESSLY UNDERTAKEN IN THIS AGREEMENT OR
TO ANY LIABILITY. NOTWITHSTANDING ANYTHING ELSE TO THE CONTRARY HEREIN, ANY
PURPORTED TRANSFER OF THIS CERTIFICATE TO OR ON BEHALF OF AN EMPLOYEE BENEFIT
PLAN SUBJECT TO TITLE I OF ERISA, SECTION 4975 OF THE CODE OR SIMILAR LAW
WITHOUT THE REPRESENTATION
D-1
LETTER OR OPINION OF COUNSEL SATISFACTORY TO THE SECURITIES ADMINISTRATOR AS
DESCRIBED ABOVE SHALL BE VOID AND OF NO EFFECT.
Certificate No. : X-1
Cut-off Date : January 1, 2007
First Distribution Date : February 26, 2007
Percentage Interest of
this Certificate ("Denomination") :
100%
CUSIP :
ISIN :
D-2
GS MORTGAGE SECURITIES CORP.
GSAA Home Equity Trust 2007-1
Asset-Backed Certificates, Series 2007-1
Class X
evidencing a percentage interest in the distributions allocable to
the Certificates of the above-referenced Class.
Distributions in respect of this Certificate are distributable
monthly as set forth herein. This Certificate does not evidence an obligation
of, or an interest in, and is not guaranteed by the Depositor the Master
Servicer, to Securities Administrator or the Trustee referred to below or any
of their respective affiliates. Neither this Certificate nor the Mortgage
Loans are guaranteed or insured by any governmental agency or instrumentality.
This certifies that Cede & Co. is the registered owner of the
Percentage Interest evidenced by this Certificate (obtained by dividing the
denomination of this Certificate by the aggregate of the denominations of all
Certificates of the Class to which this Certificate belongs) in certain
monthly distributions pursuant to a Master Servicing and Trust Agreement dated
as of the Cut-off Date specified above (the "Agreement") among GS Mortgage
Securities Corp., as depositor (the "Depositor"), U.S. Bank National
Association, as trustee (the "Trustee") and as a custodian, ▇▇▇▇▇ Fargo Bank,
National Association, as Master Servicer (in such capacity, the "Master
Servicer"), and Securities Administrator (in such capacity, the "Securities
Administrator"), The Bank of New York Trust Company, National Association, as
a custodian and Deutsche Bank National Trust Company, as a custodian. To the
extent not defined herein, the capitalized terms used herein have the meanings
assigned in the Agreement. This Certificate is issued under and is subject to
the terms, provisions and conditions of the Agreement, to which Agreement the
Holder of this Certificate by virtue of the acceptance hereof assents and by
which such Holder is bound.
This Certificate does not have a Pass-Through Rate and will be
entitled to distributions only to the extent set forth in the Agreement. In
addition, any distribution of the proceeds of any remaining assets of the
Trust will be made only upon presentment and surrender of this Certificate at
the office designated by the Securities Administrator for such purposes or the
office or agency maintained by the Securities Administrator.
No transfer of a Certificate of this Class shall be made unless such
disposition is exempt from the registration requirements of the Securities Act
of 1933, as amended (the "1933 Act"), and any applicable state securities laws
or is made in accordance with the 1933 Act and such laws. In the event of any
such transfer, the Securities Administrator shall require the transferor to
execute a transferor certificate (in substantially the form attached to the
Agreement) and deliver either (i) a Rule 144A Letter (in substantially the
form attached to the Agreement), or (ii) a written Opinion of Counsel to the
Securities Administrator that such transfer may be made pursuant to an
exemption, describing the applicable exemption and the basis therefor, from
the 1933 Act or is being made pursuant to the 1933 Act, which Opinion of
Counsel shall be an
D-3
expense of the transferor. No transfer of a Certificate of this Class shall be
made unless the Securities Administrator shall have received either (i) a
representation letter from the transferee of such Certificate, acceptable to
and in form and substance satisfactory to the Securities Administrator, to the
effect that such transferee is not an employee benefit plan subject to Section
406 of ERISA or Section 4975 of the Code or any materially similar provisions
of applicable federal, state or local law ("Similar Law") or a person acting
on behalf of or investing plan assets of any such plan, which representation
letter shall not be an expense of the Securities Administrator, or (ii) if the
transferee is an insurance company and the certificate has been the subject of
an ERISA-Qualifying Underwriting, a representation letter that it is
purchasing such Certificates with the assets of its general account and that
the purchase and holding of such Certificates satisfy the requirements for
exemptive relief under Sections I and III of PTCE 95-60, or (iii) in the case
of a Certificate presented for registration in the name of an employee benefit
plan subject to ERISA, or a plan or arrangement subject to Section 4975 of the
Code (or comparable provisions of any subsequent enactments) or a plan subject
to Similar Law, or a trustee of any such plan or any other person acting on
behalf of any such plan or arrangement or using such plan's or arrangement's
assets, an Opinion of Counsel satisfactory to the Securities Administrator,
which Opinion of Counsel shall not be an expense of the Securities
Administrator, the Depositor, the Trustee or the Trust Fund, addressed to the
Securities Administrator, the Trustee and the Depositor to the effect that the
purchase and holding of such Certificate will not constitute or result in a
non-exempt prohibited transaction within the meaning of ERISA, Section 4975 of
the Code or any Similar Law and will not subject the Trustee to any obligation
in addition to those expressly undertaken in this Agreement or to any
liability.
Reference is hereby made to the further provisions of this
Certificate set forth on the reverse hereof, which further provisions shall
for all purposes have the same effect as if set forth at this place.
This Certificate shall not be entitled to any benefit under the
Agreement or be valid for any purpose unless manually authenticated by an
authorized signatory of the Securities Administrator.
* * *
D-4
IN WITNESS WHEREOF, the Securities Administrator has caused this
Certificate to be duly executed.
Dated:
▇▇▇▇▇ FARGO BANK, NATIONAL ASSOCIATION,
not in its individual capacity, but
solely as Securities Administrator
By: _________________________________________
Authenticated:
By: _________________________________
Authorized Signatory of
▇▇▇▇▇ FARGO BANK, NATIONAL ASSOCIATION,
not in its individual capacity,
but solely as Securities Administrator
D-5
GS MORTGAGE SECURITIES CORP.
GSAA Home Equity Trust 2007-1
Asset-Backed Certificates
This Certificate is one of a duly authorized issue of Certificates
designated as GSAA Home Equity Trust 2007-1 Asset-Backed Certificates, of the
Series specified on the face hereof (herein collectively called the
"Certificates"), and representing a beneficial ownership interest in the Trust
Fund created by the Agreement.
The Certificateholder, by its acceptance of this Certificate, agrees
that it will look solely to the funds on deposit in the Distribution Account
for payment hereunder and that the Trustee is not liable to the
Certificateholders for any amount payable under this Certificate or the
Agreement or, except as expressly provided in the Agreement, subject to any
liability under the Agreement.
This Certificate does not purport to summarize the Agreement and
reference is made to the Agreement for the interests, rights and limitations
of rights, benefits, obligations and duties evidenced thereby, and the rights,
duties and immunities of the Trustee and the other parties to the Agreement.
Pursuant to the terms of the Agreement, a distribution will be made
on the 25th day of each month or, if such 25th day is not a Business Day, the
Business Day immediately following (the "Distribution Date"), commencing on
the first Distribution Date specified on the face hereof, to the Person in
whose name this Certificate is registered at the close of business on the
applicable Record Date in an amount equal to the product of the Percentage
Interest evidenced by this Certificate and the amount required to be
distributed to Holders of Certificates of the Class to which this Certificate
belongs on such Distribution Date pursuant to the Agreement. The Record Date
for each Distribution Date is the last Business Day of the month immediately
preceding the month of such Distribution Date.
Distributions on this Certificate shall be made by wire transfer of
immediately available funds to the account of the Holder hereof at a bank or
other entity having appropriate facilities therefor, if such Certificateholder
shall have so notified the Securities Administrator in writing at least five
(5) Business Days prior to the related Record Date and such Certificateholder
shall satisfy the conditions to receive such form of payment set forth in the
Agreement, or, if not, by check mailed by first class mail to the address of
such Certificateholder appearing in the Certificate Register. The final
distribution on each Certificate will be made in like manner, but only upon
presentment and surrender of such Certificate at the office designated by the
Securities Administrator for such purposes or such other location specified in
the notice to Certificateholders of such final distribution.
The Agreement permits, with certain exceptions therein provided, the
amendment thereof and the modification of the rights and obligations of the
Trustee and the rights of the Certificateholders under the Agreement at any
time by the Trustee and the other parties to the Agreement with the consent of
the Holders of Certificates affected by such amendment evidencing the
requisite Percentage Interest, as provided in the Agreement. Any such consent
by
D-6
the Holder of this Certificate shall be conclusive and binding on such Holder
and upon all future Holders of this Certificate and of any Certificate issued
upon the transfer hereof or in exchange therefor or in lieu hereof whether or
not notation of such consent is made upon this Certificate. The Agreement also
permits the amendment thereof, in certain limited circumstances, without the
consent of the Holders of any of the Certificates.
As provided in the Agreement and subject to certain limitations
therein set forth, the transfer of this Certificate is registrable in the
Certificate Register of the Securities Administrator upon surrender of this
Certificate for registration of transfer at the office designated by the
Securities Administrator for such purposes, accompanied by a written
instrument of transfer in form satisfactory to the Securities Administrator
duly executed by the holder hereof or such holder's attorney duly authorized
in writing, and thereupon one or more new Certificates of the same Class in
authorized denominations and evidencing the same aggregate Percentage Interest
in the Trust Fund will be issued to the designated transferee or transferees.
The Certificates are issuable only as registered Certificates without
coupons in denominations specified in the Agreement. As provided in the
Agreement and subject to certain limitations therein set forth, Certificates
are exchangeable for new Certificates of the same Class in authorized
denominations and evidencing the same aggregate Percentage Interest, as
requested by the Holder surrendering the same.
No service charge will be made for any such registration of transfer
or exchange, but the Securities Administrator may require payment of a sum
sufficient to cover any tax or other governmental charge payable in connection
therewith.
The Trustee, the Depositor and the Securities Administrator and any
agent of the Trustee, the Depositor or the Securities Administrator may treat
the Person in whose name this Certificate is registered as the owner hereof
for all purposes, and none of the Trustee, the Depositor, the Securities
Administrator, nor any such agent shall be affected by any notice to the
contrary.
On any Distribution Date on which the aggregate Stated Principal
Balance of the Mortgage Loans is less than or equal to 10% of the Cut-off Date
Pool Principal Balance, the Person or Persons specified in Section 11.01 of
the Agreement will have the option to effectuate the purchase, in whole, from
the Trust Fund all remaining Mortgage Loans and all property acquired in
respect of the Mortgage Loans at a purchase price determined and in the manner
as provided in the Agreement. The obligations and responsibilities created by
this Agreement will terminate as provided in Section 11.01 of the Agreement.
Any term used herein that is defined in the Agreement shall have the
meaning assigned in the Agreement, and nothing herein shall be deemed
inconsistent with that meaning.
D-7
ASSIGNMENT
----------
FOR VALUE RECEIVED, the undersigned hereby sell(s), assign(s) and
transfer(s) unto _____________________________________________________________
______________________________________________________________________________
______________________________________________________________________________
______________________________________________________________________________
______________________________________________________________________________
(Please print or typewrite name and address including postal zip code of
assignee)
the Percentage Interest evidenced by the within Certificate and hereby
authorizes the transfer of registration of such Percentage Interest to
assignee on the Certificate Register of the Trust Fund.
I (We) further direct the Securities Administrator to issue a new
Certificate of a like denomination and Class, to the above named assignee and
deliver such Certificate to the following address:
_____________________________________________________________________________.
Dated:
______________________________________
Signature by or on behalf of assignor
D-8
DISTRIBUTION INSTRUCTIONS
-------------------------
The assignee should include the following for purposes of
distribution:
Distributions shall be made, by wire transfer or otherwise, in
immediately available funds to ______________________________________________,
_____________________________________________________________________________,
for the account of __________________________________________________________,
account number ______, or, if mailed by check, to____________________________.
Applicable statements should be mailed to ___________________________________,
_____________________________________________________________________________.
This information is provided by ____________________________________,
the assignee named above, or ________________________________________________,
as its agent.
D-9
EXHIBIT E
FORM OF INITIAL CERTIFICATION OF CUSTODIAN
[date]
[Depositor]
[Trustee]
_______________________
_______________________
Re: Master Servicing and Trust Agreement, dated as of
January 1, 2007 (the "Agreement"), among GS
Mortgage Securities Corp., as depositor (the
"Depositor"), U.S. Bank National Association, as
trustee (in such capacity, the "Trustee") and as a
custodian, The Bank of New York Trust Company,
National Association and Deutsche Bank National
Trust Company, each as a custodian, and ▇▇▇▇▇ Fargo
Bank, National Association, as master servicer (in
such capacity, the "Master Servicer") and
securities administrator (in such capacity, the
"Securities Administrator")
Ladies and Gentlemen:
In accordance with Section 2.02 of the above-captioned Master
Servicing and Trust Agreement (the "Trust Agreement"), the undersigned, as
Custodian, for each Mortgage Loan listed in the Mortgage Loan Schedule for
which the undersigned is specified as the Custodian (other than any Mortgage
Loan listed in the attached exception report), it has received:
(i) the original Mortgage Note, endorsed as provided in the
following form: "Pay to the order of ________, without recourse"; and
(ii) except with respect to a MERS Loan, an executed
Assignment of Mortgage (which may be included in a blanket assignment
or assignments).
Based on its review and examination and only as to the foregoing
documents, such documents appear regular on their face and related to such
Mortgage Loan.
The Custodian has made no independent examination of any documents
contained in each Mortgage File beyond the review specifically required in the
Trust Agreement. The Custodian makes no representations as to: (i) the
validity, legality, sufficiency, enforceability, recordability or genuineness
of any of the documents contained in each Mortgage File of any of the Mortgage
Loans identified on the Mortgage Loan Schedule, or (ii) the collectability,
insurability, effectiveness or suitability of any such Mortgage Loan or the
perfection or priority of any Mortgage. Notwithstanding anything herein to the
contrary, the Custodian 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
E-1
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 Trust Agreement.
[DEUTSCHE BANK NATIONAL TRUST COMPANY]
[THE BANK OF NEW YORK TRUST COMPANY,
NATIONAL ASSOCIATION][U.S. BANK NATIONAL
ASSOCIATION], not in its individual capacity,
but solely as Custodian
By: __________________________________________
Name: ________________________________________
Title: _______________________________________
E-2
EXHIBIT F
FORM OF DOCUMENT CERTIFICATION
AND EXCEPTION REPORT OF CUSTODIAN
[date]
[Depositor]
[Trustee]
________________________
________________________
Re: Master Servicing and Trust Agreement, dated as of
January 1, 2007 (the "Agreement"), among GS
Mortgage Securities Corp., as depositor (the
"Depositor"), U.S. Bank National Association, as
trustee (in such capacity, the "Trustee") and as a
custodian, The Bank of New York Trust Company,
National Association and Deutsche Bank National
Trust Company, each as a custodian, and ▇▇▇▇▇ Fargo
Bank, National Association, as master servicer (in
such capacity, the "Master Servicer") and
securities administrator (in such capacity, the
"Securities Administrator")
Ladies and Gentlemen:
In accordance with Section 2.02 of the above-captioned Master
Servicing and Trust Agreement (the "Trust Agreement"), the undersigned, as
Custodian, hereby certifies, subject to any exceptions listed on the exception
report attached hereto, that as to each Mortgage Loan listed in the Mortgage
Loan Schedule for which the undersigned is specified as the Custodian (other
than any Mortgage Loan paid in full or listed on the attached exception
report) it has received:
1. the original Mortgage Note, endorsed without recourse in blank by
the last endorsee, including all intervening endorsements showing a complete
chain of endorsement from the originator to the last endorsee;
2. the original Assignment of Mortgage in blank (or, in the case of
the Goldman Conduit Mortgage Loans, or if the Mortgage is to be recorded,
assigned to the Trustee or in blank), unless the Mortgage Loan is a MERS Loan;
3. personal endorsement and/or guaranty agreements executed in
connection with all non individual Mortgage Loans (corporations, partnerships,
trusts, estates, etc. (if provided);
4. the related original Mortgage and evidence of its recording or a
certified copy of the Mortgage with evidence of recording thereof;
F-1
5. originals of any intervening Mortgage assignment or certified
copies in either case necessary to show a complete chain of title from the
original mortgagee to the seller and evidencing recording; provided, that,
except in the case of the Goldman Conduit Mortgage Loans, the assignment may
be in the form of a blanket assignment or assignments, a copy of which with
evidence of recording shall be acceptable;
6. if provided, originals of all assumption, modification,
consolidation or extension agreements or certified copies thereof, in either
case with evidence of recording if required to maintain the lien of the
mortgage or if otherwise required, or, if recordation is not required, an
original or copy of the agreement; provided, that, in the case of the Goldman
Conduit Mortgage Loans, an original with evidence of recording thereon is
always required;
7. except with respect to the Countrywide Mortgage Loans, (if
applicable to the files held by the Custodian) an original or copy of a title
insurance policy or evidence of title;
8. to the extent applicable, an original power of attorney; except in
the case of the Goldman Conduit Mortgage Loans, (if applicable to the files
held by the Custodian) an original power of attorney or, in limited
circumstances as set forth in the applicable Servicing Agreement, a copy of
the power of attorney; and
9. except with respect to the Countrywide Mortgage Loans, (if
applicable to the files held by the Custodian) a security agreement, chattel
mortgage or equivalent document executed in connection with the Mortgage, if
any.
Based on its review and examination and only as to the foregoing
documents, (a) such documents appear regular on their face and related to such
Mortgage Loan, and (b) the information set forth in items 2, 8, 33 and 34 of
the Mortgage Loan Schedule accurately reflects information set forth in the
Custodial File.
The Custodian has made no independent examination of any documents
contained in each Mortgage File beyond the review of the Custodial File
specifically required in the Trust Agreement. The Custodian makes no
representations as to: (i) the validity, legality, sufficiency, enforceability
or genuineness of any of the documents contained in each Mortgage File of any
of the Mortgage Loans identified on the Mortgage Loan Schedule, or (ii) the
collectability, insurability, effectiveness or suitability of any such
Mortgage Loan or the perfection or priority of any Mortgage. Notwithstanding
anything herein to the contrary, the Custodian 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.
F-2
Capitalized words and phrases used herein shall have the respective
meanings assigned to them in the Trust Agreement.
[DEUTSCHE BANK NATIONAL TRUST COMPANY]
[THE BANK OF NEW YORK TRUST COMPANY,
NATIONAL ASSOCIATION][U.S. BANK NATIONAL
ASSOCIATION], not in its individual capacity,
but solely as Custodian
By: __________________________________________
Name: ________________________________________
Title: _______________________________________
F-3
EXHIBIT G
FORM OF RESIDUAL TRANSFER AFFIDAVIT
GSAA Home Equity Trust 2007-1,
Asset-Backed Certificates, Series 2007-1
STATE OF )
) ss.:
COUNTY OF )
The undersigned, being first duly sworn, deposes and says as follows:
1. The undersigned is an officer of ___________________, the proposed
Transferee of an Ownership Interest in a Class [R][RC][RX] Certificate (the
"Certificate") issued pursuant to the Master Servicing and Trust Agreement
(the "Agreement"), among GS Mortgage Securities Corp., as depositor (the
"Depositor"), U.S. Bank National Association, as trustee (the "Trustee") and
as a custodian, ▇▇▇▇▇ Fargo Bank, National Association, as Master Servicer (in
such capacity, the "Master Servicer") and Securities Administrator (in such
capacity, the "Securities Administrator"), Deutsche Bank National Trust
Company, as a custodian and The Bank of New York Trust Company, National
Association, as a custodian. Capitalized terms used, but not defined herein,
shall have the meanings ascribed to such terms in the Agreement. The
Transferee has authorized the undersigned to make this affidavit on behalf of
the Transferee for the benefit of the Depositor, the Securities Administrator
and the Trustee.
2. The Transferee is, as of the date hereof, and will be, as of the
date of the Transfer, a Permitted Transferee. The Transferee is acquiring its
Ownership Interest in the Certificate for its own account. The Transferee has
no knowledge that any such affidavit is false.
3. The Transferee has been advised of, and understands that (i) a tax
will be imposed on Transfers of the Certificate to Persons that are not
Permitted Transferees; (ii) such tax will be imposed on the transferor, or, if
such Transfer is through an agent (which includes a broker, nominee or
middleman) for a Person that is not a Permitted Transferee, on the agent; and
(iii) the Person otherwise liable for the tax shall be relieved of liability
for the tax if the subsequent Transferee furnished to such Person an affidavit
that such subsequent Transferee is a Permitted Transferee and, at the time of
Transfer, such Person does not have actual knowledge that the affidavit is
false.
4. The Transferee has been advised of, and understands that a tax
will be imposed on a "pass-through entity" holding the Certificate if at any
time during the taxable year of the pass through entity a Person that is not a
Permitted Transferee is the record holder of an interest in such entity. The
Transferee understands that such tax will not be imposed for any period with
respect to which the record holder furnishes to the pass through entity an
affidavit that such record holder is a Permitted Transferee and the pass
through entity does not have actual knowledge that such affidavit is false.
(For this purpose, a "pass through entity" includes a regulated investment
company, a real estate investment trust or common trust fund, a
G-1
partnership, trust or estate, and certain cooperatives and, except as may be
provided in Treasury Regulations, persons holding interests in pass through
entities as a nominee for another Person.)
5. The Transferee has reviewed the provisions of Section 5.02(c) of
the Agreement and understands the legal consequences of the acquisition of an
Ownership Interest in the Certificate including, without limitation, the
restrictions on subsequent Transfers and the provisions regarding voiding the
Transfer and mandatory sales. The Transferee expressly agrees to be bound by
and to abide by the provisions of Section 5.02(c) of the Agreement and the
restrictions noted on the face of the Certificate. The Transferee understands
and agrees that any breach of any of the representations included herein shall
render the Transfer to the Transferee contemplated hereby null and void.
6. The Transferee agrees to require a Transfer Affidavit from any
Person to whom the Transferee attempts to Transfer its Ownership Interest in
the Certificate, and in connection with any Transfer by a Person for whom the
Transferee is acting as nominee, trustee or agent, and the Transferee will not
Transfer its Ownership Interest or cause any Ownership Interest to be
Transferred to any Person that the Transferee knows is not a Permitted
Transferee. In connection with any such Transfer by the Transferee, the
Transferee agrees to deliver to the Securities Administrator a certificate
substantially in the form set forth as Exhibit H to the Agreement (a
"Transferor Certificate") to the effect that such Transferee has no actual
knowledge that the Person to which the Transfer is to be made is not a
Permitted Transferee.
7. The Transferee has historically paid its debts as they have come
due, intends to pay its debts as they come due in the future, and understands
that the taxes payable with respect to the Certificate may exceed the cash
flow with respect thereto in some or all periods and intends to pay such taxes
as they become due. The Transferee does not have the intention to impede the
assessment or collection of any tax legally required to be paid with respect
to the Certificate.
8. The Transferee's taxpayer identification number is __________.
9. The Transferee is a U.S. Person as defined in Code Section
7701(a)(30).
10. The Transferee is aware that the Certificate may be a
"noneconomic residual interest" within the meaning of proposed Treasury
regulations promulgated pursuant to the Code and that the transferor of a
noneconomic residual interest will remain liable for any taxes due with
respect to the income on such residual interest, unless no significant purpose
of the transfer was to impede the assessment or collection of tax.
11. The Transferee will not cause income from the Certificate to be
attributable to a foreign permanent establishment or fixed base, within the
meaning of an applicable income tax treaty, of the Transferee or any other
U.S. person.
12. Check one of the following:
[_] The present value of the anticipated tax liabilities associated
with holding the Certificate, as applicable, does not exceed the sum of:
G-2
(i) the present value of any consideration given to the Transferee to
acquire such Certificate;
(ii) the present value of the expected future distributions on such
Certificate; and
(iii) the present value of the anticipated tax savings associated
with holding such Certificate as the related REMIC generates losses.
For purposes of this calculation, (i) the Transferee is assumed to
pay tax at the highest rate currently specified in Section 11(b) of the Code
(but the tax rate in Section 55(b)(1)(B) of the Code may be used in lieu of
the highest rate specified in Section 11(b) of the Code if the Transferee has
been subject to the alternative minimum tax under Section 55 of the Code in
the preceding two years and will compute its taxable income in the current
taxable year using the alternative minimum tax rate) and (ii) present values
are computed using a discount rate equal to the short-term Federal rate
prescribed by Section 1274(d) of the Code for the month of the transfer and
the compounding period used by the Transferee.
[_] The transfer of the Certificate complies with U.S. Treasury
Regulations Sections 1.860E-1(c)(5) and (6) and, accordingly,
(i) the Transferee is an "eligible corporation," as defined in U.S.
Treasury Regulations Section 1.860E-1(c)(6)(i), as to which income from the
Certificate will only be taxed in the United States;
(ii) at the time of the transfer, and at the close of the
Transferee's two fiscal years preceding the year of the transfer, the
Transferee had gross assets for financial reporting purposes (excluding any
obligation of a person related to the Transferee within the meaning of U.S.
Treasury Regulations Section 1.860E-1(c)(6)(ii)) in excess of $100 million and
net assets in excess of $10 million;
(iii) the Transferee will transfer the Certificate only to another
"eligible corporation," as defined in U.S. Treasury Regulations Section
1.860E-1(c)(6)(i), in a transaction that satisfies the requirements of
Sections 1.860E-1(c)(4)(i), (ii) and (iii) and Section 1.860E-1(c)(5) of the
U.S. Treasury Regulations; and
(iv) the Transferee determined the consideration paid to it to
acquire the Certificate based on reasonable market assumptions (including, but
not limited to, borrowing and investment rates, prepayment and loss
assumptions, expense and reinvestment assumptions, tax rates and other factors
specific to the Transferee) that it has determined in good faith.
[_] None of the above.
13. The Transferee is not an employee benefit plan that is subject to
Title I of ERISA or a plan that is subject to Section 4975 of the Code or a
plan subject to any federal, state or local law that is substantially similar
to Title I of ERISA or Section 4975 of the Code, and the Transferee is not
acting on behalf of or investing plan assets of such a plan.
G-3
IN WITNESS WHEREOF, the Transferee has caused this instrument to be
executed on its behalf, pursuant to authority of its Board of Directors, by
its duly authorized officer and its corporate seal to be hereunto affixed,
duly attested, this ____ day of _______, 20__.
______________________________________________
Print Name of Transferee
By: __________________________________________
Name:
Title:
[Corporate Seal]
ATTEST:
_________________________________
[Assistant] Secretary
Personally appeared before me the above-named __________, known or
proved to me to be the same person who executed the foregoing instrument and
to be the ___________ of the Transferee, and acknowledged that he executed the
same as his free act and deed and the free act and deed of the Transferee.
Subscribed and sworn before me this ____ day of ________, 20__.
______________________________________________
NOTARY PUBLIC
My Commission expires the __ day
of _________, 20__
G-4
EXHIBIT H
FORM OF TRANSFEROR CERTIFICATE
__________, 20__
GS Mortgage Securities Corp.
▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇
Attention:
▇▇▇▇▇ Fargo Bank, National Association
▇▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇ ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Re: GSAA Home Equity Trust 2007-1, Asset-Backed Certificates
Series 2007-1, Class [___]
--------------------------------------------------------
Ladies and Gentlemen:
In connection with our disposition of the above Certificates we
certify that (a) we understand that the Certificates have not been registered
under the Securities Act of 1933, as amended (the "Act"), and are being
disposed by us in a transaction that is exempt from the registration
requirements of the Act, (b) we have not offered or sold any Certificates to,
or solicited offers to buy any Certificates from, any person, or otherwise
approached or negotiated with any person with respect thereto, in a manner
that would be deemed, or taken any other action which would result in, a
violation of Section 5 of the Act and (c) to the extent we are disposing of a
Residual Certificate, (A) we have no knowledge the Transferee is not a
Permitted Transferee and (B) after conducting a reasonable investigation of
the financial condition of the Transferee, we have no knowledge and no reason
to believe that the Transferee will not pay all taxes with respect to the
Residual Certificates as they become due and (C) we have no reason to believe
that the statements made in paragraphs 7, 10 and 11 of the Transferee's
Residual Transfer Affidavit are false.
Very truly yours,
______________________________________
Print Name of Transferor
By:___________________________________
Authorized Officer
H-1
EXHIBIT I
FORM OF RULE 144A LETTER
____________, 20__
GS Mortgage Securities Corp.
▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇
Attention:
▇▇▇▇▇ Fargo Bank, National Association
▇▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇ ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Re: GSAA Home Equity Trust 2007-1, Asset-Backed Certificates,
Series 2007-1, Class [__]
---------------------------------------------------------
Ladies and Gentlemen:
In connection with our acquisition of the above Certificates we
certify that (a) we understand that the Certificates are not being registered
under the Securities Act of 1933, as amended (the "Act"), or any state
securities laws and are being transferred to us in a transaction that is
exempt from the registration requirements of the Act and any such laws, (b) we
have such knowledge and experience in financial and business matters that we
are capable of evaluating the merits and risks of investments in the
Certificates, (c) we have had the opportunity to ask questions of and receive
answers from the Depositor concerning the purchase of the Certificates and all
matters relating thereto or any additional information deemed necessary to our
decision to purchase the Certificates, (d) either we are purchasing a Class
1A1, Class 1A2, Class 2A1A, Class 2A1B, Class A4A, Class A4B, Class M1, Class
M2, Class M3, Class M4, Class M5, Class M6, Class B1 or a Class B2
Certificate, or we are not an employee benefit plan that is subject to Title I
of the Employee Retirement Income Security Act of 1974, as amended ("ERISA"),
or a plan or arrangement that is subject to Section 4975 of the Internal
Revenue Code of 1986, as amended (the "Code"), or a plan subject to any
federal, state or local law materially similar to the foregoing provisions of
ERISA or the Code, nor are we acting on behalf of any such plan or arrangement
or using the assets of any such plan or arrangement to effect such
acquisition, or, with respect to a Class B3 Certificate, Class X Certificate
or Class P Certificate that has been the subject of an ERISA-Qualifying
Underwriting, the purchaser is an insurance company that is purchasing this
certificate with funds contained in an "insurance company general account" (as
such term is defined in Section V(e) of Prohibited Transaction Class Exemption
95-60 ("PTCE 95-60")) and the purchase and holding of such Certificates
satisfy the requirements for exemptive relief under Sections I and III of PTCE
95-60, (e) we have not, nor has anyone acting on our behalf offered,
transferred, pledged, sold or otherwise disposed of the Certificates, any
interest in the Certificates or any other similar security to, or solicited
any offer to buy or accept a transfer, pledge or other disposition of the
Certificates, any interest in the Certificates or any other similar security
from, or otherwise approached or negotiated with respect to the Certificates,
any interest in the Certificates or any other similar security with, any
person in any
I-1
manner, or made any general solicitation by means of general advertising or in
any other manner, or taken any other action, that would constitute a
distribution of the Certificates under the Securities Act or that would render
the disposition of the Certificates a violation of Section 5 of the Securities
Act or require registration pursuant thereto, nor will act, nor has authorized
or will authorize any person to act, in such manner with respect to the
Certificates and (f) we are a "qualified institutional buyer" as that term is
defined in Rule 144A under the Securities Act and have completed either of the
forms of certification to that effect attached hereto as Annex 1 or Annex 2.
We are aware that the sale to us is being made in reliance on Rule 144A. We
are acquiring the Certificates for our own account or for resale pursuant to
Rule 144A and further, understand that such Certificates may be resold,
pledged or transferred only (i) to a person reasonably believed to be a
qualified institutional buyer that purchases for its own account or for the
account of a qualified institutional buyer to whom notice is given that the
resale, pledge or transfer is being made in reliance on Rule 144A, or (ii)
pursuant to another exemption from registration under the Securities Act.
I-2
ANNEX 1 TO EXHIBIT I
QUALIFIED INSTITUTIONAL BUYER STATUS UNDER SEC RULE 144A
[For Transferees Other Than Registered Investment Companies]
The undersigned (the "Buyer") hereby certifies as follows to the
parties listed in the Rule 144A Transferee Certificate to which this
certification relates with respect to the Certificates described therein:
1. As indicated below, the undersigned is the President, Chief
Financial Officer, Senior Vice President or other executive officer of the
Buyer.
2. In connection with purchases by the Buyer, the Buyer is a
"qualified institutional buyer" as that term is defined in Rule 144A under the
Securities Act of 1933, as amended ("Rule 144A"), because (i) the Buyer owned
and/or invested on a discretionary basis $___________(1) in securities (except
for the excluded securities referred to below) as of the end of the Buyer's
most recent fiscal year (such amount being calculated in accordance with Rule
144A and (ii) the Buyer satisfies the criteria in the category marked below.
____ Corporation, etc. The Buyer is a corporation (other than a bank, savings
and loan association or similar institution), Massachusetts or similar
business trust, partnership, or charitable organization described in Section
501(c)(3) of the Internal Revenue Code of 1986, as amended.
____ Bank. The Buyer (a) is a national bank or banking institution organized
under the laws of any State, territory or the District of Columbia, the
business of which is substantially confined to banking and is supervised by
the State or territorial banking commission or similar official or is a
foreign bank or equivalent institution, and (b) has an audited net worth of at
least $25,000,000 as demonstrated in its latest annual financial statements, a
copy of which is attached hereto.
____ Savings and Loan. The Buyer (a) is a savings and loan association,
building and loan association, cooperative bank, homestead association or
similar institution, which is supervised and examined by a State or Federal
authority having supervision over any such institutions or is a foreign
savings and loan association or equivalent institution and (b) has an audited
net worth of at least $25,000,000 as demonstrated in its latest annual
financial statements, a copy of which is attached hereto.
____ Broker-dealer. The Buyer is a dealer registered pursuant to Section 15 of
the Securities Exchange Act of 1934.
____ Insurance Company. The Buyer is an insurance company whose primary and
predominant business activity is the writing of insurance or the reinsuring of
risks underwritten by insurance companies and which is subject to supervision
by the insurance commissioner or a similar official or agency of a State,
territory or the District of Columbia.
____________________________
(1) Buyer must own and/or invest on a discretionary basis at least
$100,000,000 in securities unless Buyer is a dealer, and, in that case, Buyer
must own and/or invest on a discretionary basis at least $10,000,000 in
securities.
I-3
____ State or Local Plan. The Buyer is a plan established and maintained by a
State, its political subdivisions, or any agency or instrumentality of the
State or its political subdivisions, for the benefit of its employees.
____ ERISA Plan. The Buyer is an employee benefit plan within the meaning of
Title I of the Employee Retirement Income Security Act of 1974.
____ Investment Advisor. The Buyer is an investment advisor registered under
the Investment Advisors Act of 1940.
____ Small Business Investment Company. Buyer is a small business investment
company licensed by the U.S. Small Business Administration under Section
301(c) or (d) of the Small Business Investment Act of 1958.
____ Business Development Company. Buyer is a business development company as
defined in Section 202(a)(22) of the Investment Advisors Act of 1940.
3. The term "securities" as used herein does not include (i)
securities of issuers that are affiliated with the Buyer, (ii) securities that
are part of an unsold allotment to or subscription by the Buyer, if the Buyer
is a dealer, (iii) securities issued or guaranteed by the U.S. or any
instrumentality thereof, (iv) bank deposit notes and certificates of deposit,
(v) loan participations, (vi) repurchase agreements, (vii) securities owned
but subject to a repurchase agreement and (viii) currency, interest rate and
commodity swaps.
4. For purposes of determining the aggregate amount of securities
owned and/or invested on a discretionary basis by the Buyer, the Buyer used
the cost of such securities to the Buyer and did not include any of the
securities referred to in the preceding paragraph, except (i) where the Buyer
reports its securities holdings in its financial statements on the basis of
their market value, and (ii) no current information with respect to the cost
of those securities has been published. If clause (ii) in the preceding
sentence applies, the securities may be valued at market. Further, in
determining such aggregate amount, the Buyer may have included securities
owned by subsidiaries of the Buyer, but only if such subsidiaries are
consolidated with the Buyer in its financial statements prepared in accordance
with generally accepted accounting principles and if the investments of such
subsidiaries are managed under the Buyer's direction. However, such securities
were not included if the Buyer is a majority-owned, consolidated subsidiary of
another enterprise and the Buyer is not itself a reporting company under the
Securities Exchange Act of 1934, as amended.
5. The Buyer acknowledges that it is familiar with Rule 144A and
understands that the seller to it and other parties related to the
Certificates are relying and will continue to rely on the statements made
herein because one or more sales to the Buyer may be in reliance on Rule 144A.
6. Until the date of purchase of the Rule 144A Securities, the Buyer
will notify each of the parties to which this certification is made of any
changes in the information and conclusions herein. Until such notice is given,
the Buyer's purchase of the Certificates will constitute a reaffirmation of
this certification as of the date of such purchase. In addition, if the
I-4
Buyer is a bank or savings and loan is provided above, the Buyer agrees that
it will furnish to such parties updated annual financial statements promptly
after they become available.
______________________________________
Print Name of Transferee
By: __________________________________
Name:
Title:
Date: ________________________________
I-5
ANNEX 2 TO EXHIBIT I
QUALIFIED INSTITUTIONAL BUYER STATUS UNDER SEC RULE 144A
--------------------------------------------------------
[For Transferees That are Registered Investment Companies]
The undersigned (the "Buyer") hereby certifies as follows to the
parties listed in the Rule 144A Transferee Certificate to which this
certification relates with respect to the Certificates described therein:
1. As indicated below, the undersigned is the President, Chief
Financial Officer or Senior Vice President of the Buyer or, if the Buyer is a
"qualified institutional buyer" as that term is defined in Rule 144A under the
Securities Act of 1933, as amended ("Rule 144A"), because Buyer is part of a
Family of Investment Companies (as defined below), is such an officer of the
Adviser.
2. In connection with purchases by Buyer, the Buyer is a "qualified
institutional buyer" as defined in SEC Rule 144A because (i) the Buyer is an
investment company registered under the Investment Company Act of 1940, as
amended and (ii) as marked below, the Buyer alone, or the Buyer's Family of
Investment Companies, owned at least $100,000,000 in securities (other than
the excluded securities referred to below) as of the end of the Buyer's most
recent fiscal year. For purposes of determining the amount of securities owned
by the Buyer or the Buyer's Family of Investment Companies, the cost of such
securities was used, except (i) where the Buyer or the Buyer's Family of
Investment Companies reports its securities holdings in its financial
statements on the basis of their market value, and (ii) no current information
with respect to the cost of those securities has been published. If clause
(ii) in the preceding sentence applies, the securities may be valued at
market.
____ The Buyer owned $___________ in securities (other than the excluded
securities referred to below) as of the end of the Buyer's most recent fiscal
year (such amount being calculated in accordance with Rule 144A).
____ The Buyer is part of a Family of Investment Companies which owned in the
aggregate $__________ in securities (other than the excluded securities
referred to below) as of the end of the Buyer's most recent fiscal year (such
amount being calculated in accordance with Rule 144A).
3. The term "Family of Investment Companies" as used herein means two
or more registered investment companies (or series thereof) that have the same
investment adviser or investment advisers that are affiliated (by virtue of
being majority owned subsidiaries of the same parent or because one investment
adviser is a majority owned subsidiary of the other).
4. The term "securities" as used herein does not include (i)
securities of issuers that are affiliated with the Buyer or are part of the
Buyer's Family of Investment Companies, (ii) securities issued or guaranteed
by the U.S. or any instrumentality thereof, (iii) bank deposit notes and
certificates of deposit, (iv) loan participations, (v) repurchase agreements,
(vi) securities owned but subject to a repurchase agreement and (vii)
currency, interest rate and commodity swaps.
I-6
5. The Buyer is familiar with Rule 144A and understands that the
parties listed in the Rule 144A Transferee Certificate to which this
certification relates are relying and will continue to rely on the statements
made herein because one or more sales to the Buyer will be in reliance on Rule
144A. In addition, the Buyer will only purchase for the Buyer's own account.
6. Until the date of purchase of the Certificates, the undersigned
will notify the parties listed in the Rule 144A Transferee Certificate to
which this certification relates of any changes in the information and
conclusions herein. Until such notice is given, the Buyer's purchase of the
Certificates will constitute a reaffirmation of this certification by the
undersigned as of the date of such purchase.
______________________________________
Print Name of Transferee
By: __________________________________
Name:
Title:
IF AN ADVISER:
______________________________________
Print Name of Buyer
Date: ________________________________
I-7
EXHIBIT J-1
FORM OF BACK-UP CERTIFICATION
(Master Servicer)
Re: Master Servicing and Trust Agreement, dated as of January
1, 2007 (the "Agreement"), among GS Mortgage Securities
Corp., as depositor (the "Depositor"), U.S. Bank National
Association, as trustee (in such capacity, the "Trustee")
and as a custodian, The Bank of New York Trust Company,
National Association and Deutsche Bank National Trust
Company, each as a custodian, and ▇▇▇▇▇ Fargo Bank,
National Association, as master servicer (in such
capacity, the "Master Servicer") and securities
administrator (in such capacity, the "Securities
Administrator").
I, ________________________________, the _______________________ of [NAME OF
COMPANY] (the "Company"), certify to the Depositor, and its officers, with the
knowledge and intent that they will rely upon this certification, that:
(1) I have reviewed the servicer compliance statement of the
Company provided in accordance with Item 1123 of Regulation AB (the
"Compliance Statement"), the report on assessment of the Company's
compliance with the servicing criteria set forth in Item 1122(d) of
Regulation AB (the "Servicing Criteria"), provided in accordance with
Rules 13a-18 and 15d-18 under Securities Exchange Act of 1934, as
amended (the "Exchange Act") and Item 1122 of Regulation AB (the
"Servicing Assessment"), the registered public accounting firm's
attestation report provided in accordance with Rules 13a-18 and
15d-18 under the Exchange Act and Section 1122(b) of Regulation AB
(the "Attestation Report"), all servicing reports, officer's
certificates and other information relating to the servicing of the
Mortgage Loans by the Company during 2006 that were delivered by the
Company to the Depositor and the Securities Administrator pursuant to
the Agreement (collectively, the "Company Servicing Information");
(2) Based on my knowledge, the Company Servicing
Information, taken as a whole, does not contain any untrue statement
of a material fact or omit to state a material fact necessary to make
the statements made, in the light of the circumstances under which
such statements were made, not misleading with respect to the period
of time covered by the Company Servicing Information;
(3) Based on my knowledge, all of the Company Servicing
Information required to be provided by the Company under the
Agreement has been provided to the Depositor;
(4) I am responsible for reviewing the activities performed
by the Company as a servicer under the Agreement, and based on my
knowledge and the compliance review conducted in preparing the
Compliance Statement and except as disclosed in the Compliance
Statement, the Servicing Assessment or the Attestation Report, the
Company has fulfilled its obligations under the Agreement; and
J-1-1
(5) The Compliance Statement required to be delivered by the
Company pursuant to the Agreement, and the Servicing Assessment and
Attestation Report required to be provided by the Company and by any
Subservicer or Subcontractor pursuant to the Agreement, have been
provided to the Master Servicer. Any material instances of
noncompliance described in such reports have been disclosed to the
Master Servicer. Any material instance of noncompliance with the
Servicing Criteria has been disclosed in such reports.
Date: ________________________________
By: _________________________________
Name:
Title:
▇-▇-▇
▇▇▇▇▇▇▇ ▇-▇
FORM OF BACK-UP CERTIFICATION
(Securities Administrator)
Re: Master Servicing and Trust Agreement, dated as of January
1, 2007 (the "Agreement"), among GS Mortgage Securities
Corp., as depositor (the "Depositor"), U.S. Bank National
Association, as trustee (in such capacity, the "Trustee")
and as a custodian, The Bank of New York Trust Company,
National Association and Deutsche Bank National Trust
Company, each as a custodian, and ▇▇▇▇▇ Fargo Bank,
National Association, as master servicer (in such
capacity, the "Master Servicer") and securities
administrator (in such capacity, the "Securities
Administrator").
I, ________________________________, the _______________________ of [NAME OF
COMPANY] (the "Company"), certify to the Depositor, and its officers, with the
knowledge and intent that they will rely upon this certification, that:
(1) I have reviewed the report on assessment of the
Company's compliance with the servicing criteria set forth in Item
1122(d) of Regulation AB (the "Servicing Criteria"), provided in
accordance with Rules 13a-18 and 15d-18 under Securities Exchange Act
of 1934, as amended (the "Exchange Act") and Item 1122 of Regulation
AB (the "Servicing Assessment"), the registered public accounting
firm's attestation report provided in accordance with Rules 13a-18
and 15d-18 under the Exchange Act and Section 1122(b) of Regulation
AB (the "Attestation Report"), all reports on Form 10-D containing
statements to certificateholders filed in respect of the period
included in the year covered by the annual report of the Trust Fund
(collectively, the "Distribution Date Statements");
(2) Assuming the accuracy and completeness of the
information delivered to the Company by the Master Servicer as
provided in the Agreement and subject to paragraph (4) below, the
distribution information determined by the Company and set forth in
the Distribution Date Statements contained in all Form 10-D's
included in the year covered by the annual report of such Trust on
Form 10-K for the calendar year 200[ ], is complete and does not
contain any material misstatement of fact as of the last day of the
period covered by such annual report;
(3) Based solely on the information delivered to the Company
by the Master Servicer as provided in the Agreement, (i) the
distribution information required under the Agreement to be contained
in the Trust Fund's Distribution Date Statements and (ii) the
servicing information required to be provided by the Master Servicer
to the Securities Administrator for inclusion in the Trust Fund's
Distribution Date Statements, to the extent received by the
Securities Administrator from the Master Servicer in accordance with
the Agreement, is included in such Distribution Date Statements;
J-2-1
(4) The Company is not certifying as to the accuracy,
completeness or correctness of the information which it received from
the Master Servicer and did not independently verify or confirm the
accuracy, completeness or correctness of the information provided by
the Master Servicer;
(5) I am responsible for reviewing the activities performed
by the Company as a person "performing a servicing function" under
the Agreement, and based on my knowledge and the compliance review
conducted in preparing the Servicing Assessment and except as
disclosed in the Servicing Assessment or the Attestation Report, the
Company has fulfilled its obligations under the Agreement; and
(6) The Servicing Assessment and Attestation Report required
to be provided by the Company pursuant to the Agreement, have been
provided to the Depositor. Any material instances of noncompliance
described in such reports have been disclosed to the Depositor. Any
material instance of noncompliance with the Servicing Criteria has
been disclosed in such reports.
Date: ________________________________
By: _________________________________
Name:
Title:
J-2-2
EXHIBIT K
FORM OF SERVICING CRITERIA TO BE ADDRESSED
IN ASSESSMENT OF COMPLIANCE STATEMENT
The assessment of compliance to be delivered by the [Master Servicer]
[Securities Administrator] [Custodians] shall address, at a minimum, the
criteria identified as below as "Applicable Servicing Criteria":
----------------------------------------------------------------------------------------------------------------------------------
Master Securities
Servicing Criteria Servicer Administrator Custodians
----------------------------------------------------------------------------------------------------------------------------------
Reference Criteria
----------------------------------------------------------------------------------------------------------------------------------
General Servicing Considerations
----------------------------------------------------------------------------------------------------------------------------------
Policies and procedures are instituted
to monitor any performance or other
triggers and events of default in
accordance with the transaction
1122(d)(1)(i) agreements.
----------------------------------------------------------------------------------------------------------------------------------
If any material servicing activities are outsourced
to third parties, policies and procedures are
instituted to monitor the third party's performance
1122(d)(1)(ii) and compliance with such servicing activities.
----------------------------------------------------------------------------------------------------------------------------------
Any requirements in the transaction
agreements to maintain a back-up
1122(d)(1)(iii) servicer for the mortgage loans are maintained.
----------------------------------------------------------------------------------------------------------------------------------
A fidelity bond and errors and omissions policy is in
effect on the party participating in the servicing
function throughout the reporting period in the
amount of coverage required by and otherwise in X
accordance with the terms of the transaction
1122(d)(1)(iv) agreements.
----------------------------------------------------------------------------------------------------------------------------------
Cash Collection and Administration
----------------------------------------------------------------------------------------------------------------------------------
Payments on mortgage loans are
deposited into the appropriate
custodial bank accounts and related
bank clearing accounts no more than two X
business days following receipt, or
such other number of days specified in
1122(d)(2)(i) the transaction agreements.
----------------------------------------------------------------------------------------------------------------------------------
Disbursements made via wire transfer on
behalf of an obligor or to an investor X
1122(d)(2)(ii) are made only by authorized personnel.
----------------------------------------------------------------------------------------------------------------------------------
J-2-1
----------------------------------------------------------------------------------------------------------------------------------
Master Securities
Servicing Criteria Servicer Administrator Custodians
----------------------------------------------------------------------------------------------------------------------------------
Reference Criteria
----------------------------------------------------------------------------------------------------------------------------------
Advances of funds or guarantees regarding
collections, cash flows or distributions, and any
interest or other fees charged for such advances, X
are made, reviewed and approved as
1122(d)(2)(iii) specified in the transaction agreements.
----------------------------------------------------------------------------------------------------------------------------------
The related accounts for the
transaction, such as cash reserve
accounts or accounts established as a
form of overcollateralization, are X
separately maintained (e.g., with
respect to commingling of cash) as set
1122(d)(2)(iv) forth in the transaction agreements.
----------------------------------------------------------------------------------------------------------------------------------
Each custodial account is maintained at
a federally insured depository
institution as set forth in the
transaction agreements. For purposes of
this criterion, "federally insured
depository institution" with respect to X
a foreign financial institution means a
foreign financial institution that
meets the requirements of Rule
13k-1(b)(1) of the Securities Exchange
1122(d)(2)(v) Act.
----------------------------------------------------------------------------------------------------------------------------------
Unissued checks are safeguarded so as X
1122(d)(2)(vi) to prevent unauthorized access.
----------------------------------------------------------------------------------------------------------------------------------
Reconciliations are prepared on a
monthly basis for all asset-backed
securities related bank accounts,
including custodial accounts and
related bank clearing accounts. These
reconciliations are (A) mathematically
accurate; (B) prepared within 30
calendar days after the bank statement
cutoff date, or such other number of
days specified in the transaction X
agreements; (C) reviewed and approved
by someone other than the person who
prepared the reconciliation; and (D)
contain explanations for reconciling
items. These reconciling items are
resolved within 90 calendar days of
their original identification, or such
other number of days specified in the
1122(d)(2)(vii) transaction agreements.
----------------------------------------------------------------------------------------------------------------------------------
J-2-2
----------------------------------------------------------------------------------------------------------------------------------
Master Securities
Servicing Criteria Servicer Administrator Custodians
----------------------------------------------------------------------------------------------------------------------------------
Reference Criteria
----------------------------------------------------------------------------------------------------------------------------------
Investor Remittances and Reporting
----------------------------------------------------------------------------------------------------------------------------------
Reports to investors, including those to be filed
with the Commission, are maintained in accordance
with the transaction agreements and applicable
Commission requirements. Specifically, such reports
(A) are prepared in accordance with timeframes and
other terms set forth in the transaction
agreements; (B) provide information
calculated in accordance with the terms X X
specified in the transaction agreements;
(C) are filed with the Commission as required
by its rules and regulations; and (D) agree
with investors' or the trustee's records as
to the total unpaid principal balance
and number of mortgage loans serviced
1122(d)(3)(i) by the Servicer.
----------------------------------------------------------------------------------------------------------------------------------
Amounts due to investors are allocated
and remitted in accordance with
timeframes, distribution priority and X X
other terms set forth in the
1122(d)(3)(ii) transaction agreements.
----------------------------------------------------------------------------------------------------------------------------------
Disbursements made to an investor are posted within
two business days to the Servicer's investor records, X
or such other number of days specified in the
1122(d)(3)(iii) transaction agreements.
----------------------------------------------------------------------------------------------------------------------------------
Amounts remitted to investors per the
investor reports agree with cancelled
checks, or other form of payment, or X
1122(d)(3)(iv) custodial bank statements.
----------------------------------------------------------------------------------------------------------------------------------
Pool Asset Administration
----------------------------------------------------------------------------------------------------------------------------------
Collateral or security on mortgage
loans is maintained as required by the
transaction agreements or related X
1122(d)(4)(i) mortgage loan documents.
----------------------------------------------------------------------------------------------------------------------------------
Mortgage loan and related documents are
safeguarded as required by the X
1122(d)(4)(ii) transaction agreements.
----------------------------------------------------------------------------------------------------------------------------------
Any additions, removals or substitutions to the asset
pool are made, reviewed and approved in accordance
with any conditions or requirements in the
1122(d)(4)(iii) transaction agreements.
----------------------------------------------------------------------------------------------------------------------------------
J-2-3
----------------------------------------------------------------------------------------------------------------------------------
Master Securities
Servicing Criteria Servicer Administrator Custodians
----------------------------------------------------------------------------------------------------------------------------------
Reference Criteria
----------------------------------------------------------------------------------------------------------------------------------
Payments on mortgage loans, including any payoffs,
made in accordance with the related mortgage loan
documents are posted to the Servicer's obligor
records maintained no more than two business days
after receipt, or such other number of days specified
in the transaction agreements, and allocated to
principal, interest or other items (e.g., escrow) in
1122(d)(4)(iv) accordance with the related mortgage loan documents.
----------------------------------------------------------------------------------------------------------------------------------
The Servicer's records regarding the mortgage loans
agree with the Servicer's records with respect to an
1122(d)(4)(v) obligor's unpaid principal balance.
----------------------------------------------------------------------------------------------------------------------------------
Changes with respect to the terms or status of an
obligor's mortgage loans (e.g., loan modifications or
re-agings) are made, reviewed and approved by
authorized personnel in accordance with the
transaction agreements and related
1122(d)(4)(vi) pool asset documents.
----------------------------------------------------------------------------------------------------------------------------------
Loss mitigation or recovery actions (e.g.,
forbearance plans, modifications and deeds in lieu of
foreclosure, foreclosures and repossessions, as
applicable) are initiated, conducted and concluded in
accordance with the timeframes or other requirements
1122(d)(4)(vii) established by the transaction agreements.
----------------------------------------------------------------------------------------------------------------------------------
Records documenting collection efforts are maintained
during the period a mortgage loan is delinquent in
accordance with the transaction agreements. Such
records are maintained on at least a monthly basis,
or such other period specified in the transaction
agreements, and describe the entity's activities in
monitoring delinquent mortgage loans including, for
example, phone calls, letters and payment
rescheduling plans in cases where delinquency is
1122(d)(4)(viii) deemed temporary (e.g., illness or unemployment).
----------------------------------------------------------------------------------------------------------------------------------
J-2-4
----------------------------------------------------------------------------------------------------------------------------------
Master Securities
Servicing Criteria Servicer Administrator Custodians
----------------------------------------------------------------------------------------------------------------------------------
Reference Criteria
----------------------------------------------------------------------------------------------------------------------------------
Adjustments to interest rates or rates of return for
mortgage loans with variable rates are computed based
1122(d)(4)(ix) on the related mortgage loan documents.
----------------------------------------------------------------------------------------------------------------------------------
Regarding any funds held in trust for an obligor
(such as escrow accounts): (A) such funds are
analyzed, in accordance with the obligor's mortgage
loan documents, on at least an annual basis, or such
other period specified in the transaction agreements;
(B) interest on such funds is paid, or credited, to
obligors in accordance with applicable mortgage loan
documents and state laws; and (C) such funds are
returned to the obligor within 30 calendar days of
full repayment of the related mortgage loans, or such
other number of days specified in the
1122(d)(4)(x) transaction agreements.
----------------------------------------------------------------------------------------------------------------------------------
Payments made on behalf of an obligor (such as tax or
insurance payments) are made on or before the related
penalty or expiration dates, as indicated on the
appropriate bills or notices for such payments,
provided that such support has been received by the
servicer at least 30 calendar days prior to these
dates, or such other number of days specified in the
1122(d)(4)(xi) transaction agreements.
----------------------------------------------------------------------------------------------------------------------------------
Any late payment penalties in connection with any
payment to be made on behalf of an obligor are paid
from the servicer's funds and not charged to the
obligor, unless the late payment was due to the
1122(d)(4)(xii) obligor's error or omission.
----------------------------------------------------------------------------------------------------------------------------------
Disbursements made on behalf of an obligor are posted
within two business days to the obligor's records
maintained by the servicer, or such other number of
1122(d)(4)(xiii) days specified in the transaction agreements.
----------------------------------------------------------------------------------------------------------------------------------
Delinquencies, charge-offs and
uncollectible accounts are recognized
and recorded in accordance with the
1122(d)(4)(xiv) transaction agreements.
----------------------------------------------------------------------------------------------------------------------------------
J-2-5
----------------------------------------------------------------------------------------------------------------------------------
Master Securities
Servicing Criteria Servicer Administrator Custodians
----------------------------------------------------------------------------------------------------------------------------------
Reference Criteria
----------------------------------------------------------------------------------------------------------------------------------
Any external enhancement or other support, identified
in Item 1114(a)(1) through (3) or Item 1115 of
Regulation AB, is maintained as set forth in the
1122(d)(4)(xv) transaction agreements.
----------------------------------------------------------------------------------------------------------------------------------
J-2-6
EXHIBIT L
FORM OF REQUEST FOR RELEASE OF DOCUMENTS
To: U.S. Bank National Assoc. Attention: Document Custody Services
▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇ ▇▇▇ ▇▇▇▇▇▇▇▇▇ ▇▇▇▇
▇▇-▇▇-▇▇▇▇
▇▇. ▇▇▇▇, ▇▇ ▇▇▇▇▇ FAX: (▇▇▇) ▇▇▇-▇▇▇▇ or ▇▇▇-▇▇▇▇
RE: Custodial Agreement between U.S. Bank National Association, a custodian,
and ___________________ as the company stated in the "agreement".
In connection with and pursuant to Section , of the agreement, we request the
release and acknowledge of the custodial file for the mortgage loan described
below, for the reason indicated:
FROM: Servicer: ____________________________________________________________
City/State _______________________
SERVICER LOAN #: ___________________________________,
U.S. BANK # ________________________________________________,
Deal Name: _________________________________________,
Mortgagor's Name: ______________________________________ Original loan amount
______________________________
Property Address: ___________________________________________ Payment amount:
______________________________
City/State/Zip: _______________________________________________Interest rate:
______________________________
REASON FOR REQUESTING DOCUMENTS (check one)
-------------------------------------------
______________________ 1. Loan paid in full
______________________ 2. Loan in foreclosure
______________________ 3. Loan being substituted
______________________ 4. Loan being liquidated by company
______________________ 5. Other (please explain)
__________________________________________________________________
L-1
If box 1 or 4 above is checked, and if all or part of the Custodial File was
previously released to us, then please provide a copy of the previous release
request (RR) to us as well as any additional documents in your possession
relating to the above specified mortgage loan.
If box 2 or 5 above is checked, then upon our return to you as custodian, all
of the documents for the above specified mortgage loan, please acknowledge
your receipt by signing in the space indicated below, and returning this form
to us.
COMPANY NAME: ____________________________________ PHONE# ____________________
AUTHORIZED SIGNER:
______________________________________________________________________________
NAME (TYPED): _________________________________ DATE: ______________________
PHONE #: ________________________________
DATE: ___________________________________
______________________________________________________________________________
PLEASE MAIL DOCUMENTS BACK TO:
------------------------------
______________________________________________________________________________
______________________________________________________________________________
______________________________________________________________________________
______________________________________________________________________________
▇-▇
▇▇▇▇▇▇▇ ▇-▇
FORM OF REQUEST FOR RELEASE OF DOCUMENTS
To: Deutsche Bank National Trust Company
▇▇▇▇ ▇▇▇▇ ▇▇. ▇▇▇▇▇▇ ▇▇▇▇▇,
▇▇▇▇▇ ▇▇▇, ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Attention: Mortgage Custody - GS0701
RE: Master Servicing and Trust Agreement, dated as of January 1, 2007 (the
"Agreement"), among GS Mortgage Securities Corp., as depositor (the
"Depositor"), U.S. Bank National Association, as trustee (in such capacity,
the "Trustee") and as a custodian, The Bank of New York Trust Company,
National Association and Deutsche Bank National Trust Company, each as a
custodian, and ▇▇▇▇▇ Fargo Bank, National Association, as master servicer (in
such capacity, the "Master Servicer") and securities administrator (in such
capacity, the "Securities Administrator").
In connection with and pursuant to Section____________, of the agreement, we
request the release and acknowledge of the custodial file for the mortgage
loan described below, for the reason indicated below. Further, any payments
received by the Servicer listed below in connection with this request for
release have been deposited into the Distribution Account for the benefit of
the Trust.
FROM: Servicer: ___________________________________________________________,
City/State______________
SERVICER LOAN #: ___________________________,
DEUTSCHE BANK NATIONAL TRUST COMPANY #_______________________________,
Deal Name: ____________________,
Mortgagor's Name: _______________________________________________ Original
loan amount: ________
Property Address: ________________________________________________ Payment
amount: ____________
City/State/Zip: __________________________________________________ Interest
rate: ________________
REASON FOR REQUESTING DOCUMENTS (check one)
-------------------------------------------
______________________ 1. Loan paid in full
______________________ 2. Loan in foreclosure
______________________ 3. Loan being substituted
L-2-1
______________________ 4. Loan being liquidated by company
______________________ 5. Other (please explain)
___________________________________________________________________
If box 1 or 4 above is checked, and if all or part of the Custodial File was
previously released to us, then please provide a copy of the previous release
request (RR) to us as well as any additional documents in your possession
relating to the above specified mortgage loan.
If box 2 or 5 above is checked, then upon our return to you as custodian, all
of the documents for the above specified mortgage loan, please acknowledge
your receipt by signing in the space indicated below, and returning this form
to us.
COMPANY NAME: ____________________________________ PHONE# ____________________
AUTHORIZED SIGNER:
______________________________________________________________________________
NAME (TYPED): _________________________________ DATE: ______________________
PHONE #: ________________________________
DATE: ___________________________________
______________________________________________________________________________
PLEASE MAIL DOCUMENTS BACK TO:
------------------------------
______________________________________________________________________________
______________________________________________________________________________
______________________________________________________________________________
______________________________________________________________________________
▇-▇-▇
▇▇▇▇▇▇▇ ▇-▇
FORM OF REQUEST FOR RELEASE OF DOCUMENTS
To: The Bank of New York Trust Company, National Association
▇▇▇▇ ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇., ▇▇▇▇▇ ▇▇▇,
▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇▇
RE: Master Servicing and Trust Agreement, dated as of January 1, 2007 (the
"Agreement"), among GS Mortgage Securities Corp., as depositor (the
"Depositor"), U.S. Bank National Association, as trustee (in such capacity,
the "Trustee") and as a custodian, The Bank of New York Trust Company,
National Association and Deutsche Bank National Trust Company, each as a
custodian, and ▇▇▇▇▇ Fargo Bank, National Association, as master servicer (in
such capacity, the "Master Servicer") and securities administrator (in such
capacity, the "Securities Administrator").
In connection with and pursuant to Section____________, of the agreement, we
request the release and acknowledge of the custodial file for the mortgage
loan described below, for the reason indicated below:
FROM: Servicer: ________________________________________________________,
City/State______________
SERVICER LOAN #: ___________________________,
DEUTSCHE BANK NATIONAL TRUST COMPANY #_______________________________,
Deal Name: ____________________,
Mortgagor's Name: _______________________________________________ Original
loan amount: ________
Property Address: ________________________________________________ Payment
amount: ____________
City/State/Zip: __________________________________________________ Interest
rate: ________________
REASON FOR REQUESTING DOCUMENTS (check one)
-------------------------------------------
______________________ 1. Loan paid in full
______________________ 2. Loan in foreclosure
______________________ 3. Loan being substituted
______________________ 4. Loan being liquidated by company
______________________ 5. Other (please explain)
L-1-1
____________________________________________________________________________
If box 1 or 4 above is checked, and if all or part of the Custodial File was
previously released to us, then please provide a copy of the previous release
request (RR) to us as well as any additional documents in your possession
relating to the above specified mortgage loan.
If box 2 or 5 above is checked, then upon our return to you as custodian, all
of the documents for the above specified mortgage loan, please acknowledge
your receipt by signing in the space indicated below, and returning this form
to us.
COMPANY NAME: ____________________________________ PHONE# ____________________
AUTHORIZED SIGNER:
______________________________________________________________________________
NAME (TYPED): _________________________________ DATE: ______________________
PHONE #: ________________________________
DATE: ___________________________________
______________________________________________________________________________
PLEASE MAIL DOCUMENTS BACK TO:
------------------------------
______________________________________________________________________________
______________________________________________________________________________
______________________________________________________________________________
______________________________________________________________________________
L-1-2
EXHIBIT M
Form 8-K Disclosure Information
----------------------------------------------------------------------------------------------------------------------------
FORM 8-K DISCLOSURE INFORMATION
----------------------------------------------------------------------------------------------------------------------------
Item on Form 8-K Responsible Party
----------------------------------------------------------------------------------------------------------------------------
Item 1.01- Entry into a Material Definitive
Agreement
Disclosure is required regarding entry into or amendment The party to this Agreement entering into such Material
of any definitive agreement that is material to the Definitive Agreement.
securitization, even if depositor is not a party.
Examples: servicing agreement, custodial agreement.
Note: disclosure not required as to definitive agreements
that are fully disclosed in the prospectus.
----------------------------------------------------------------------------------------------------------------------------
Item 1.02- Termination of a Material Definitive
Agreement
Disclosure is required regarding termination of any
definitive agreement that is material to the The party to this Agreement requesting termination of
securitization (other than expiration in accordance with a Material Definitive Agreement.
its terms), even if depositor is not a party.
Examples: servicing agreement, custodial agreement.
----------------------------------------------------------------------------------------------------------------------------
Item 1.03- Bankruptcy or Receivership
Disclosure is required regarding the bankruptcy or
receivership, with respect to any of the following:
----------------------------------------------------------------------------------------------------------------------------
o Sponsor (Seller) Depositor/Sponsor (Seller)
----------------------------------------------------------------------------------------------------------------------------
o Depositor Depositor
----------------------------------------------------------------------------------------------------------------------------
o Master Servicer Master Servicer
----------------------------------------------------------------------------------------------------------------------------
o Affiliated Servicer Servicer
----------------------------------------------------------------------------------------------------------------------------
o Other Servicer servicing 20% or more of the pool Servicer
assets at the time of the report
----------------------------------------------------------------------------------------------------------------------------
o Other material servicers Servicer
----------------------------------------------------------------------------------------------------------------------------
o Trustee Trustee
----------------------------------------------------------------------------------------------------------------------------
o Securities Administrator Securities Administrator
----------------------------------------------------------------------------------------------------------------------------
o Significant Obligor Depositor
----------------------------------------------------------------------------------------------------------------------------
o Credit Enhancer (10% or more) Depositor
----------------------------------------------------------------------------------------------------------------------------
o Derivative Counterparty Depositor
----------------------------------------------------------------------------------------------------------------------------
o Custodian Custodian
----------------------------------------------------------------------------------------------------------------------------
M-1
----------------------------------------------------------------------------------------------------------------------------
FORM 8-K DISCLOSURE INFORMATION
----------------------------------------------------------------------------------------------------------------------------
Item on Form 8-K Responsible Party
----------------------------------------------------------------------------------------------------------------------------
Item 2.04- Triggering Events that Accelerate or Increase a Master Servicer and Securities Administrator
Direct Financial Obligation or an Obligation under an
Off-Balance Sheet Arrangement
Includes an early amortization, performance trigger or
other event, including event of default, that would
materially alter the payment priority/distribution of cash
flows/amortization schedule.
Disclosure will be made of events other than waterfall
triggers which are disclosed in the monthly statements
to the certificateholders.
----------------------------------------------------------------------------------------------------------------------------
Item 3.03- Material Modification to Rights of Security Securities Administrator
Holders
Disclosure is required of any material modification to
documents defining the rights of Certificateholders,
including the Pooling and Servicing Agreement.
----------------------------------------------------------------------------------------------------------------------------
Item 5.03- Amendments of Articles of Incorporation or (i) Securities Administrator and (ii) Depositor with
Bylaws; Change of Fiscal Year respect to any information relating to the Depositor
Disclosure is required of any amendment "to the governing
documents of the issuing entity".
----------------------------------------------------------------------------------------------------------------------------
Item 6.01- ABS Informational and Computational Depositor
Material
----------------------------------------------------------------------------------------------------------------------------
Item 6.02- Change of Servicer or Securities Administrator Master Servicer/Securities Administrator/Servicer
Requires disclosure of any removal, replacement,
substitution or addition of any master servicer,
affiliated servicer, other servicer servicing 10%
or more of pool assets at time of report, other
material servicers or trustee.
----------------------------------------------------------------------------------------------------------------------------
Reg AB disclosure about any new servicer or master Servicer/Master Servicer/Depositor
servicer is also required.
----------------------------------------------------------------------------------------------------------------------------
Reg AB disclosure about any new Trustee is also required. Depositor/Successor Trustee
----------------------------------------------------------------------------------------------------------------------------
Item 6.03- Change in Credit Enhancement or External Support Depositor and Securities Administrator
Covers termination of any enhancement in manner other
than by its terms, the addition of an enhancement, or a
material change in the enhancement provided. Applies to
external credit enhancements as well as derivatives.
----------------------------------------------------------------------------------------------------------------------------
Reg AB disclosure about any new enhancement provider is
also required.
----------------------------------------------------------------------------------------------------------------------------
Item 6.04- Failure to Make a Required Distribution Depositor
----------------------------------------------------------------------------------------------------------------------------
Item 6.05- Securities Act Updating Disclosure Depositor
If any material pool characteristic differs by 5% or more at
the time of issuance of the securities from the description
in the final prospectus, provide updated Reg AB disclosure
about the actual asset pool.
----------------------------------------------------------------------------------------------------------------------------
M-2
----------------------------------------------------------------------------------------------------------------------------
FORM 8-K DISCLOSURE INFORMATION
----------------------------------------------------------------------------------------------------------------------------
Item on Form 8-K Responsible Party
----------------------------------------------------------------------------------------------------------------------------
If there are any new servicers or originators required to Depositor
be disclosed under Regulation AB as a result of the foregoing,
provide the information called for in Items 1108 and 1110
respectively.
----------------------------------------------------------------------------------------------------------------------------
Item 7.01- Reg FD Disclosure All Parties (excluding Custodian and
Trustee)
----------------------------------------------------------------------------------------------------------------------------
Item 8.01- Other Events Depositor
Any event, with respect to which information is not otherwise
called for in Form 8-K, that the registrant deems of
importance to certificateholders.
----------------------------------------------------------------------------------------------------------------------------
Item 9.01- Financial Statements and Exhibits Responsible party for reporting/disclosing the
financial statement or exhibit
----------------------------------------------------------------------------------------------------------------------------
M-3
EXHIBIT N
Additional Form 10-D Disclosure
----------------------------------------------------------------------------------------------------------------------------
ADDITIONAL FORM 10-D DISCLOSURE
----------------------------------------------------------------------------------------------------------------------------
Item on Form 10-D Responsible Party
----------------------------------------------------------------------------------------------------------------------------
Item 1: Distribution and Pool Performance
Information
----------------------------------------------------------------------------------------------------------------------------
Information included in the [Monthly Statement] Servicer, Master Servicer and Securities Administrator
----------------------------------------------------------------------------------------------------------------------------
Any information required by 1121 which is NOT included Depositor
on the [Monthly Statement]
----------------------------------------------------------------------------------------------------------------------------
Item 2: Legal Proceedings
Any legal proceeding pending against the following
entities or their respective property, that is material
to Certificateholders, including any proceedings known
to be contemplated by governmental authorities:
----------------------------------------------------------------------------------------------------------------------------
o Issuing Entity (Trust Fund) Master Servicer, Securities Administrator and Depositor
----------------------------------------------------------------------------------------------------------------------------
o Sponsor (Seller) Seller (if a party to the Pooling and Servicing
Agreement) or Depositor
----------------------------------------------------------------------------------------------------------------------------
o Depositor Depositor
----------------------------------------------------------------------------------------------------------------------------
o Trustee Trustee
----------------------------------------------------------------------------------------------------------------------------
o Securities Administrator Securities Administrator
----------------------------------------------------------------------------------------------------------------------------
o Master Servicer Master Servicer
----------------------------------------------------------------------------------------------------------------------------
o Custodian Custodian
----------------------------------------------------------------------------------------------------------------------------
o 1110(b) Originator Depositor
----------------------------------------------------------------------------------------------------------------------------
o Any 1108(a)(2) Servicer (other than the Master Servicer
Servicer or Securities Administrator)
----------------------------------------------------------------------------------------------------------------------------
o Any other party contemplated by 1100(d)(1) Depositor
----------------------------------------------------------------------------------------------------------------------------
Item 3: Sale of Securities and Use of Proceeds (i) Depositor (with respect to the Closing Date) and
(ii) Master Servicer
Information from Item 2(a) of Part II of Form 10-Q:
With respect to any sale of securities by the sponsor,
depositor or issuing entity, that are backed by the
same asset pool or are otherwise issued by the
issuing entity, whether or not registered, provide
the sales and use of proceeds information in Item
701 of Regulation S-K. Pricing information can be
omitted if securities were not registered.
----------------------------------------------------------------------------------------------------------------------------
Item 4: Defaults Upon Senior Securities Securities Administrator
Information from Item 3 of Part II of Form 10-Q:
Report the occurrence of any Event of Default (after
expiration of any grace period and provision of any
required notice)
----------------------------------------------------------------------------------------------------------------------------
Item 5: Submission of Matters to a Vote of Security Securities Administrator
Holders
Information from Item 4 of Part II of Form 10-Q
----------------------------------------------------------------------------------------------------------------------------
N-1
----------------------------------------------------------------------------------------------------------------------------
ADDITIONAL FORM 10-D DISCLOSURE
----------------------------------------------------------------------------------------------------------------------------
Item on Form 10-D Responsible Party
----------------------------------------------------------------------------------------------------------------------------
Item 6: Significant Obligors of Pool Assets Depositor
Item 1112(b) - Significant Obligor Financial Information*
----------------------------------------------------------------------------------------------------------------------------
* This information need only be reported on the Form 10-D
for the distribution period in which updated information
is required pursuant to the Item.
----------------------------------------------------------------------------------------------------------------------------
Item 7: Significant Enhancement Provider Information
Item 1114(b)(2) - Credit Enhancement Provider Financial
Information*
----------------------------------------------------------------------------------------------------------------------------
* Determining applicable disclosure threshold Depositor
----------------------------------------------------------------------------------------------------------------------------
* Requesting required financial information (including Depositor
any required accountants' consent to the use thereof) or
effecting incorporation by reference
----------------------------------------------------------------------------------------------------------------------------
* This information need only be reported on the Form 10-D
for the distribution period in which updated information
is required pursuant to the Items.
----------------------------------------------------------------------------------------------------------------------------
Item 8: Other Information Any party responsible for the applicable
disclosure items on Form 8-K
Disclose any information required to be reported on Form
8-K during the period covered by the Form 10-D but not
reported
----------------------------------------------------------------------------------------------------------------------------
Item 9: Exhibits Securities Administrator
Monthly Statement to Certificateholders
----------------------------------------------------------------------------------------------------------------------------
Exhibits required by Item 601 of Regulation S-K, such as Depositor
material agreements
----------------------------------------------------------------------------------------------------------------------------
N-2
EXHIBIT O
Additional Form 10-K Disclosure
----------------------------------------------------------------------------------------------------------------------------
ADDITIONAL FORM 10-K DISCLOSURE
----------------------------------------------------------------------------------------------------------------------------
Item on Form 10-K Responsible Party
----------------------------------------------------------------------------------------------------------------------------
----------------------------------------------------------------------------------------------------------------------------
Item 1B: Unresolved Staff Comments Depositor
----------------------------------------------------------------------------------------------------------------------------
Item 9B: Other Information Any responsible party for Disclosure Item on Form 8-K
Disclose any information required to be reported
on Form 8-K during the fourth quarter covered by
the Form 10-K but not reported
----------------------------------------------------------------------------------------------------------------------------
Item 15: Exhibits, Financial Statement Schedules (i) As to agreements, Securities Administrator/Depositor
and (ii) as to financial statements, Reporting Parties (as
to themselves) (excluding Custodian or Trustee)
----------------------------------------------------------------------------------------------------------------------------
Reg AB Item 1112(b): Significant Obligors of Pool Depositor
Assets
----------------------------------------------------------------------------------------------------------------------------
Significant Obligor Financial Information*
----------------------------------------------------------------------------------------------------------------------------
*This information need only be reported on the
Form 10-D for the distribution period in which
updated information is required pursuant to
the Item.
----------------------------------------------------------------------------------------------------------------------------
Reg AB Item 1114(b)(2): Credit Enhancement Provider
Financial Information
----------------------------------------------------------------------------------------------------------------------------
o Determining applicable disclosure threshold Depositor
----------------------------------------------------------------------------------------------------------------------------
o Requesting required financial information (including Depositor
any required accountants' consent to the use thereof) or
effecting incorporation by reference
----------------------------------------------------------------------------------------------------------------------------
*This information need only be reported on the
Form 10-D for the distribution period in which
updated information is required pursuant to the
Items.
----------------------------------------------------------------------------------------------------------------------------
Reg AB Item 1115(b): Derivative Counterparty Financial
Information
----------------------------------------------------------------------------------------------------------------------------
o Determining current maximum probable exposure Depositor
----------------------------------------------------------------------------------------------------------------------------
o Determining current significance percentage Depositor
----------------------------------------------------------------------------------------------------------------------------
o Requesting required financial information (including Depositor
any required accountants' consent to the use thereof) or
effecting incorporation by reference
----------------------------------------------------------------------------------------------------------------------------
*This information need only be reported on the
Form 10-D for the distribution period in which
updated information is required pursuant to the
Items.
----------------------------------------------------------------------------------------------------------------------------
O-1
----------------------------------------------------------------------------------------------------------------------------
ADDITIONAL FORM 10-K DISCLOSURE
----------------------------------------------------------------------------------------------------------------------------
Item on Form 10-K Responsible Party
----------------------------------------------------------------------------------------------------------------------------
----------------------------------------------------------------------------------------------------------------------------
Reg AB Item 1117: Legal Proceedings
Any legal proceeding pending against the following
entities or their respective property, that is
material to Certificateholders, including any
proceedings known to be contemplated by
governmental authorities:
----------------------------------------------------------------------------------------------------------------------------
o Issuing Entity (Trust Fund) Master Servicer, Securities Administrator and Depositor
----------------------------------------------------------------------------------------------------------------------------
o Sponsor (Seller) Seller (if a party to the Pooling and Servicing
Agreement) or Depositor
----------------------------------------------------------------------------------------------------------------------------
o Depositor Depositor
----------------------------------------------------------------------------------------------------------------------------
o Trustee Trustee
----------------------------------------------------------------------------------------------------------------------------
o Securities Administrator Securities Administrator
----------------------------------------------------------------------------------------------------------------------------
o Master Servicer Master Servicer
----------------------------------------------------------------------------------------------------------------------------
o Custodian Custodian
----------------------------------------------------------------------------------------------------------------------------
o 1110(b) Originator Depositor
----------------------------------------------------------------------------------------------------------------------------
o Any 1108(a)(2) Servicer (other than the Master Servicer
Servicer or Securities Administrator)
----------------------------------------------------------------------------------------------------------------------------
o Any other party contemplated by 1100(d)(1) Depositor
----------------------------------------------------------------------------------------------------------------------------
Reg AB Item 1119: Affiliations and Relationships
----------------------------------------------------------------------------------------------------------------------------
Whether (a) the Sponsor (Seller), Depositor or Issuing Depositor as to (a)
Entity is an affiliate of the following parties, and (b) Sponsor/Seller as to (a)
to the extent known and material, any of the following
parties are affiliated with one another:
----------------------------------------------------------------------------------------------------------------------------
o Master Servicer Master Servicer
----------------------------------------------------------------------------------------------------------------------------
o Securities Administrator Securities Administrator
----------------------------------------------------------------------------------------------------------------------------
o Any other 1108(a)(3) servicer Servicer
----------------------------------------------------------------------------------------------------------------------------
o Any 1110 Originator Depositor/Sponsor
----------------------------------------------------------------------------------------------------------------------------
o Any 1112(b) Significant Obligor Depositor/Sponsor
----------------------------------------------------------------------------------------------------------------------------
o Any 1114 Credit Enhancement Provider Depositor/Sponsor
----------------------------------------------------------------------------------------------------------------------------
o Any 1115 Derivate Counterparty Provider Depositor/Sponsor
----------------------------------------------------------------------------------------------------------------------------
o Any other 1101(d)(1) material party Depositor/Sponsor
----------------------------------------------------------------------------------------------------------------------------
Whether there are any "outside the ordinary course Depositor as to (a)
business arrangements" other than would be obtained in an Sponsor/Seller as to (a)
arm's length transaction between (a) the Sponsor (Seller),
Depositor or Issuing Entity on the one hand, and (b) any
of the following parties (or their affiliates) on the
other hand, that exist currently or within the past two
years and that are material and that are material to a
Certificateholder's understanding of the Certificates:
----------------------------------------------------------------------------------------------------------------------------
O-2
----------------------------------------------------------------------------------------------------------------------------
ADDITIONAL FORM 10-K DISCLOSURE
----------------------------------------------------------------------------------------------------------------------------
Item on Form 10-K Responsible Party
----------------------------------------------------------------------------------------------------------------------------
o Master Servicer Master Servicer
----------------------------------------------------------------------------------------------------------------------------
o Securities Administrator Securities Administrator
----------------------------------------------------------------------------------------------------------------------------
o Trustee Depositor
----------------------------------------------------------------------------------------------------------------------------
o Any other 1108(a)(3) servicer Servicer
----------------------------------------------------------------------------------------------------------------------------
o Any 1110 Originator Depositor/Sponsor
----------------------------------------------------------------------------------------------------------------------------
o Any 1112(b) Significant Obligor Depositor/Sponsor
----------------------------------------------------------------------------------------------------------------------------
o Any 1114 Credit Enhancement Provider Depositor/Sponsor
----------------------------------------------------------------------------------------------------------------------------
o Any 1115 Derivate Counterparty Provider Depositor/Sponsor
----------------------------------------------------------------------------------------------------------------------------
o Any other 1101(d)(1) material party Depositor/Sponsor
----------------------------------------------------------------------------------------------------------------------------
Whether there are any specific relationships involving the Depositor as to (a)
transaction or the pool assets between (a) the Sponsor Sponsor/Seller as to (a)
(Seller), Depositor or Issuing Entity on the one hand, and
(b) any of the following parties (or their affiliates) on
the other hand, that exist currently or within the past
two years and that are material:
----------------------------------------------------------------------------------------------------------------------------
o Master Servicer Master Servicer
----------------------------------------------------------------------------------------------------------------------------
o Securities Administrator Securities Administrator
----------------------------------------------------------------------------------------------------------------------------
o Trustee Depositor
----------------------------------------------------------------------------------------------------------------------------
o Any other 1108(a)(3) servicer Servicer
----------------------------------------------------------------------------------------------------------------------------
o Any 1110 Originator Depositor/Sponsor
----------------------------------------------------------------------------------------------------------------------------
o Any 1112(b) Significant Obligor Depositor/Sponsor
----------------------------------------------------------------------------------------------------------------------------
o Any 1114 Credit Enhancement Provider Depositor/Sponsor
----------------------------------------------------------------------------------------------------------------------------
o Any 1115 Derivate Counterparty Provider Depositor/Sponsor
----------------------------------------------------------------------------------------------------------------------------
o Any other 1101(d)(1) material party Depositor/Sponsor
----------------------------------------------------------------------------------------------------------------------------
O-3
EXHIBIT P
Form of Master Loan Purchase Agreement, between various sellers
and ▇▇▇▇▇▇▇ ▇▇▇▇▇ Mortgage Company
[See Exhibit 99.1 to Form 8-K/A filed with the Commission on
February 14, 2006, Accession No. 0000905148-06-001326]
P-1
EXHIBIT Q
Flow Servicing Agreement, dated as of January 1, 2006,
between Avelo Mortgage, L.L.C. and ▇▇▇▇▇▇▇ Sachs Mortgage Company
[See Exhibit 99.13 to Form 8-K filed with the Commission on March
14, 2006, Accession No. 0000905148-06-00297]
Q-1
EXHIBIT R
Servicing Agreement, dated as of July 1, 2004,
between Countrywide Home Loans Servicing LP and
▇▇▇▇▇▇▇ ▇▇▇▇▇ Mortgage Company, as
amended by Amendment Reg AB
[See Exhibit 99.3 to Form 8-K filed with the Commission on March
13, 2006, Accession No. 0000905148-06-002297]
R-1
EXHIBIT S
Master Mortgage Loan Purchase Agreement, dated as of
July 1, 2004, between Countrywide Home Loans, Inc.
and ▇▇▇▇▇▇▇ Sachs Mortgage Company, as amended by Amendment Reg AB
[See Exhibit 99.3 to Form 8-K filed with the Commission on March
13, 2006, Accession No. 0000905148-06-002297]
S-1
EXHIBIT T
Amendment Reg AB to the Master Mortgage Loan Purchase
and Servicing Agreement, dated as of January 1, 2006, among
▇▇▇▇▇▇▇ ▇▇▇▇▇ Mortgage Company, Countrywide Home Loans,
Inc. and Countrywide Home Loans Servicing LP
[See Exhibit 99.1 to Form 8-K filed with the Commission on March
14, 2006, Accession No. 0000905148-06-002297]
T-1
EXHIBIT U
Amended and Restated Master Mortgage Loan Purchase Agreement,
dated as of November 1, 2005, between GreenPoint Mortgage Funding, Inc.
and ▇▇▇▇▇▇▇ Sachs Mortgage Company
[See Exhibit 99.9 to Form 8-K/A filed with the Commission on
February 14, 2006, Accession No. 0000905148-06-001326]
U-1
EXHIBIT V
Servicing Agreement, dated as of November 1, 2005, between
GreenPoint Mortgage Funding, Inc. and ▇▇▇▇▇▇▇ ▇▇▇▇▇ Mortgage Company
[See Exhibit 99.9 to Form 8-K/A filed with the Commission on
February 14, 2006, Accession No. 0000905148-06-001326]
V-1
EXHIBIT W
The Seller's Purchase, Warranties and Servicing Agreement, dated as of
April 1, 2006, between ▇▇▇▇▇▇▇ Sachs Mortgage Company and
Wachovia Mortgage Corporation
[See Exhibit 99.1 to Form 8-K filed with the Commission on
September 8, 2006, Accession No. 0000905148-06-005642]
W-1