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MORTGAGE ASSET SECURITIZATION TRANSACTIONS, INC.,
Depositor
▇▇▇▇▇ FARGO HOME MORTGAGE, INC.,
Originator
▇▇▇▇▇ FARGO HOME MORTGAGE, INC.,
Servicer
THE CHASE MANHATTAN BANK,
Trustee
and
▇▇▇▇▇ FARGO BANK MINNESOTA, N.A.,
Trust Administrator
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POOLING AND SERVICING AGREEMENT
Dated as of September 1, 2001
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MASTR ADJUSTABLE RATE MORTGAGES TRUST 2001-1
MORTGAGE PASS-THROUGH CERTIFICATES, Series 2001-1
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TABLE OF CONTENTS
ARTICLE I
DEFINITIONS
Section 1.02. Certain Calculations.........................................
ARTICLE II
CONVEYANCE OF MORTGAGE LOANS; REPRESENTATIONS AND WARRANTIES
Section 2.01. Conveyance of Mortgage Loans.................................
Section 2.02. Acceptance by Trust Administrator of the Mortgage Loans......
Section 2.03. Representations, Warranties and Covenants of the
Originator..................................................
Section 2.04. Representations and Warranties of the Depositor as to the
Mortgage Loans..............................................
Section 2.05. [Reserved.]..................................................
Section 2.06. Execution and Delivery of Certificates.......................
Section 2.07. REMIC Matters................................................
Section 2.08. Covenants of the Servicer....................................
Section 2.09. Representations and Warranties of the Servicer...............
ARTICLE III
ADMINISTRATION AND SERVICING
OF MORTGAGE LOANS
Section 3.01. Servicer to Service Mortgage Loans...........................
Section 3.02. Subservicing; Enforcement of the Obligations of Servicers....
Section 3.03. Rights of the Depositor, the Trust Administrator and the
Trustee in Respect of the Servicer..........................
Section 3.04. Trust Administrator to Act as Servicer.......................
Section 3.05. Collection of Mortgage Loan Payments; Collection Account;
Trust Administrator Account; Distribution Account...........
Section 3.06. Collection of Taxes, Assessments and Similar Items;
Escrow Accounts.............................................
Section 3.07. Access to Certain Documentation and Information Regarding
the Mortgage Loans..........................................
Section 3.08. Permitted Withdrawals from the Collection Account, Trust
Administrator Account and Distribution Account..............
Section 3.09. Maintenance of Hazard Insurance; Maintenance of Primary
Insurance Policies..........................................
Section 3.10. Enforcement of Due-on-Sale Clauses; Assumption Agreements....
Section 3.11. Realization upon Defaulted Mortgage Loans....................
Section 3.12. Trust Administrator to Cooperate; Release of Mortgage
Files.......................................................
Section 3.13. Documents Records and Funds in Possession of Servicer to
Be Held for the Trust Administrator.........................
Section 3.14. Servicing Compensation.......................................
Section 3.15. Access to Certain Documentation..............................
Section 3.16. Annual Statement as to Compliance............................
Section 3.17. Annual Independent Public Accountants' Servicing
Statement; Financial Statements.............................
Section 3.18. Errors and Omissions Insurance; Fidelity Bonds...............
Section 3.19. Restoration of Mortgaged Property............................
Section 3.20. Inspections..................................................
ARTICLE IV
DISTRIBUTIONS AND ADVANCES BY THE SERVICER
Section 4.01. Advances.....................................................
Section 4.02. Priorities of Distribution...................................
Section 4.03. Allocation of Realized Losses................................
Section 4.04. Monthly Statements to Certificateholders.....................
ARTICLE V
THE CERTIFICATES
Section 5.01. The Certificates.............................................
Section 5.02. Certificate Register; Registration of Transfer and
Exchange of Certificates....................................
Section 5.03. Mutilated, Destroyed, Lost or Stolen Certificates............
Section 5.04. Persons Deemed Owners........................................
Section 5.05. Access to List of Certificateholders' Names and Addresses....
Section 5.06. Maintenance of Office or Agency..............................
ARTICLE VI
THE DEPOSITOR AND THE SERVICER
Section 6.01. Respective Liabilities of the Depositor and the Servicer.....
Section 6.02. Merger or Consolidation of the Depositor or the Servicer.....
Section 6.03. Limitation on Liability of the Depositor, the Loan
Seller, the Originator, the Servicer and Others.............
Section 6.04. Limitation on Resignation of Servicer........................
ARTICLE VII
DEFAULT
Section 7.01. Events of Default............................................
Section 7.02. Trust Administrator to Act; Appointment of Successor.........
Section 7.03. Notification to Certificateholders...........................
ARTICLE VIII
CONCERNING THE TRUSTEE AND THE TRUST ADMINISTRATOR
Section 8.01. Duties of Trustee and the Trust Administrator................
Section 8.02. Certain Matters Affecting the Trustee and the Trust
Administrator...............................................
Section 8.03. Neither Trustee nor Trust Administrator Liable for
Certificates or Mortgage Loans..............................
Section 8.04. Trustee and Trust Administrator May Own Certificates.........
Section 8.05. Expenses of the Trustee and Trust Administrator..............
Section 8.06. Eligibility Requirements for Trustee and Trust
Administrator...............................................
Section 8.07. Resignation and Removal of Trustee or the Trust
Administrator...............................................
Section 8.08. Successor Trustee; Successor Trust Administrator.............
Section 8.09. Merger or Consolidation of Trustee or Trust Administrator....
Section 8.10. Appointment of Co-Trustee or Separate Trustee................
Section 8.11. Tax Matters..................................................
Section 8.12. Periodic Filings.............................................
ARTICLE IX
TERMINATION
Section 9.01. Termination upon Liquidation or Purchase of All Mortgage
Loans.......................................................
Section 9.02. Final Distribution on the Certificates.......................
Section 9.03. Additional Termination Requirements..........................
ARTICLE X
MISCELLANEOUS PROVISIONS
Section 10.01. Amendment...................................................
Section 10.02. Recordation of Agreement; Counterparts......................
Section 10.03. Governing Law...............................................
Section 10.04. Intention of Parties........................................
Section 10.05. Notices.....................................................
Section 10.06. Severability of Provisions..................................
Section 10.07. Assignment..................................................
Section 10.08. Limitation on Rights of Certificateholders..................
Section 10.09. Inspection and Audit Rights.................................
Section 10.10. Certificates Nonassessable and Fully Paid...................
SCHEDULES
Schedule I: Mortgage Loan Schedule.......................................
Schedule II: Representations and Warranties of the Originator.............
Schedule III: Representations and Warranties as to the Mortgage Loans......
[EXHIBITS]
Exhibit A-1: Form of Class A-1 Certificate................................
Exhibit A-R: Form of Class A-R Certificate................................
Exhibit B: Form of Junior Certificate...................................
Exhibit C: (Reserved)...................................................
Exhibit D: (Reserved)...................................................
Exhibit E: Form of Reverse of Certificates..............................
Exhibit F: Form of Initial Certification................................
Exhibit G: Form of Final Certification of Trustee.......................
Exhibit H: Transfer Affidavit...........................................
Exhibit I: Form of Transferor Certificate...............................
Exhibit J: Form of Investment Letter (Non-Rule 144A)....................
Exhibit K: Form of Rule 144A Letter.....................................
Exhibit L: Request for Release (for Trustee)............................
THIS POOLING AND SERVICING AGREEMENT, dated as of September 1,
2001, among MORTGAGE ASSET SECURITIZATION TRANSACTIONS, INC., a Delaware
corporation, as depositor (the "Depositor"), ▇▇▇▇▇ FARGO HOME MORTGAGE, INC., a
California corporation, as originator (the "Originator") and as servicer (in
such capacity, the "Servicer"), THE CHASE MANHATTAN BANK, a New York banking
corporation, as trustee (the "Trustee"), and ▇▇▇▇▇ FARGO BANK MINNESOTA, N.A., a
national banking association, as trust administrator (the "Trust
Administrator").
WITNESSETH THAT
In consideration of the mutual agreements herein contained, the
parties hereto agree as follows:
PRELIMINARY STATEMENT
The Depositor is the owner of the Trust Fund that is hereby conveyed
to the Trustee in return for the Certificates. The Trust Fund is being conveyed
to the Trustee to create a trust for the benefit of the Certificateholders. The
Trust Fund for federal income tax purposes will consist of a single REMIC. The
Certificates will represent the entire beneficial ownership interest in the
Trust Fund. The Regular Certificates will represent the "regular interests" in
the Trust Fund and the Residual Certificates will represent the single "residual
interest" in the Trust Fund. The "latest possible maturity date" for federal
income tax purposes of all interests created hereby will be the Latest Possible
Maturity Date.
The following table sets forth characteristics of the Certificates,
together with the minimum denominations and integral multiples in excess thereof
in which such Classes shall be issuable (except that one Certificate of each
Class of Certificates may be issued in a different amount):
INTEGRAL
INITIAL CLASS INITIAL MULTIPLES
CERTIFICATE PASS-THROUGH MINIMUM IN EXCESS OF
BALANCE RATE (1) DENOMINATION MINIMUM
------- -------- ------------ -------
Class A-1 $212,957,000 6.2022% $ 25,000 $1
Class A-R $ 100 6.2022% $ 100 N/A
Class B-1 $ 2,538,000 6.2022% $ 25,000 $1
Class B-2 $ 2,206,000 6.2022% $ 25,000 $1
Class B-3 $ 1,214,000 6.2022% $ 25,000 $1
Class B-4 $ 442,000 6.2022% $ 25,000 $1
Class B-5 $ 441,000 6.2022% $ 25,000 $1
Class B-6 $ 883,519.77 6.2022% $ 25,000 $1
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(1) The Pass-Through Rate for the Class A-1, Class A-R, Class B-1, Class B-2,
Class B-3, Class B-4, Class B-5 and Class B-6 Certificates for any
Distribution Date occurring after the first Distribution Date will be a
per annum rate equal to the average of the Net Mortgage Rates of the
Mortgage Loans, weighted on the basis of their respective Scheduled
Principal Balances.
Set forth below are designations of Classes of Certificates to the
categories used herein:
Book-Entry Certificates...... All Classes of Offered Certificates other than
the Physical Certificates.
Class A Certificates......... The Class A-1 and Class A-R Certificates.
Class B Certificates......... The Class B-1, Class B-2, Class B-3, Class B-4,
Class B-5 and Class B-6 Certificates.
ERISA-Restricted
Certificates............... The Residual Certificates and the Class B-4,
Class B-5 and Class B-6 Certificates.
Junior Certificates.......... The Class B-1, Class B-2, Class B-3, Class B-4,
Class B-5 and Class B-6 Certificates.
Offered Certificates......... All Classes of Certificates other than the
Private Certificates.
Physical Certificates........ The Private Certificates and the Residual
Certificates.
Private Certificates......... The Class B-4, Class B-5 and Class B-6
Certificates.
Rating Agencies.............. ▇▇▇▇▇'▇ and S&P.
Regular Certificates......... All Classes of Certificates, other than the
Residual Certificates.
Residual Certificates........ The Class A-R Certificates.
Scheduled Principal
Classes.................... None.
Senior Certificates.......... The Class A-1 and Class A-R Certificates.
With respect to any of the foregoing designations as to which the
corresponding reference is "None," all defined terms and provisions herein
relating solely to such designations shall be of no force or effect, and any
calculations herein incorporating references to such designations shall be
interpreted without reference to such designations and amounts. Defined terms
and provisions herein relating to statistical rating agencies not designated
above as Rating Agencies shall be of no force or effect.
ARTICLE I
DEFINITIONS
Whenever used in this Agreement, the following words and phrases,
unless the context otherwise requires, shall have the following meanings:
Accepted Servicing Practices: The servicing practices of prudent
mortgage lending institutions which service mortgage loans of the same type as
the Mortgage Loans in the jurisdictions where the Mortgage Loans are located.
Accrued Certificate Interest: With respect to any Distribution Date
and interest bearing Class, the sum of (i) one month's interest accrued during
the related Interest Accrual Period at the Pass-Through Rate for such Class on
the related Class Principal Balance subject to reduction as provided in Section
4.02(d) and (ii) any Class Unpaid Interest Amounts for such Class.
Adjusted Mortgage Rate: As to each Mortgage Loan, and at any time,
the per annum rate equal to the Mortgage Rate less the Servicing Fee Rate.
Adjustment Amount: With respect to each anniversary of the Cut-off
Date, the amount, if any, by which the Special Hazard Loss Coverage Amount
(without giving effect to the deduction of the Adjustment Amount for such
anniversary) exceeds the lesser of:
(1) an amount calculated by the Servicer and approved by each of
▇▇▇▇▇'▇ and S&P, which amount shall not be less than $500,000; and
(2) the greater of (x) 1% (or if greater than 1%, the highest
percentage of Mortgage Loans by principal balance secured by Mortgaged
Properties in any California zip code) of the outstanding principal
balance of all the Mortgage Loans on the Distribution Date immediately
preceding such anniversary and (y) twice the outstanding principal balance
of the Mortgage Loan which has the largest outstanding principal balance
on the Distribution Date immediately preceding such anniversary.
Adjustment Date: As to each Mortgage Loan, the date on which the
Mortgage Rate is adjusted in accordance with the terms of the related Mortgage
Note and Mortgage.
Advance: The payment required to be made by the Servicer with
respect to any Distribution Date pursuant to Section 4.01, the amount of any
such payment being equal to the aggregate of payments of principal and interest
(net of the Servicing Fee and net of any net income in the case of any REO
Property) on the Mortgage Loans that were due on the related Due Date and not
received as of the close of business on immediately preceding Determination
Date, less the aggregate amount of any such delinquent payments that the
Servicer has determined would constitute a Nonrecoverable Advance if advanced.
Affiliate: When used with reference to a specified Person that (i)
directly or indirectly controls or is controlled by or is under common control
with the specified Person, (ii) is an officer of, partner in or trustee of, or
serves in a similar capacity with respect to, the specified person or of which
the specified Person is an officer, partner or trustee, or with respect to which
the specified Person serves in a similar capacity, or (iii) directly or
indirectly is the beneficial owner of 10% or more of any class of equity
securities of the specified Person or of which the specified person is directly
or indirectly the owner of 10% or more of any class of equity securities.
Agreement: This Pooling and Servicing Agreement and all amendments
or supplements hereto.
Allocable Share: As to any Distribution Date, the Junior Optimal
Principal Amount and any Class of Junior Certificates, the portion of the Junior
Optimal Principal Amount allocable to such Class, equal to the product of the
Junior Optimal Principal Amount on such Distribution Date and a fraction, the
numerator of which is the related Class Principal Balance thereof and the
denominator of which is the aggregate of the Class Principal Balances of the
Junior Certificates; provided, that if the Class Prepayment Trigger is not
satisfied for any outstanding class of Class B Certificates, the Allocable Share
will be distributable entirely to the most senior class of outstanding Class B
Certificates.
Amount Available for Senior Principal: As to any Distribution Date,
Available Funds for such Distribution Date reduced by the aggregate amount
distributable on such Distribution Date in respect of interest on the Senior
Certificates pursuant to Section 4.02(a)(ii).
Amount Held for Future Distribution: As to any Distribution Date,
the aggregate amount held in the Collection Account at the close of business on
the related Determination Date on account of (i) Principal Prepayments received
after the related Prepayment Period, and Liquidation Proceeds and Insurance
Proceeds received in the month of such Distribution Date and (ii) all Scheduled
Payments due after the related Due Date.
Appraised Value: With respect to any Mortgage Loan, the Appraised
Value of the related Mortgaged Property shall be: (i) with respect to a Mortgage
Loan other than a Refinancing Mortgage Loan, the lesser of (a) the value of the
Mortgaged Property based upon the appraisal made at the time of the origination
of such Mortgage Loan and (b) the sales price of the Mortgaged Property at the
time of the origination of such Mortgage Loan; and (ii) with respect to a
Refinancing Mortgage Loan, the value of the Mortgaged Property based upon the
appraisal made-at the time of the origination of such Refinancing Mortgage Loan
as modified by an updated appraisal.
Assignment: An individual assignment of a Mortgage, notice of
transfer or equivalent instrument in recordable form, sufficient under the laws
of the jurisdiction wherein the related Mortgaged Property is located to reflect
of record the sale or transfer of the Mortgage Loan.
Available Funds: As to any Distribution Date, the sum of (a) the
aggregate amount held in the Collection Account at the close of business on the
related Determination Date net of the Amount Held for Future Distribution and
net of amounts permitted to be withdrawn from the Collection Account pursuant to
clauses (i)-(viii), inclusive, of Section 3.08(a) and amounts permitted to be
withdrawn from the Trust Administrator Account pursuant to clauses (ii)-(iv),
inclusive, of Section 3.08(b) and amounts permitted to be withdrawn from the
Distribution Account pursuant to clauses (i)-(iv) inclusive of Section 3.08(c),
(b) the amount of the related Advance and (c) in connection with Defective
Mortgage Loans, as applicable, the aggregate of the Purchase Prices and
Substitution Adjustment Amounts deposited on the related Distribution Account
Deposit Date.
Bankruptcy Code: The United States Bankruptcy Reform Act of 1978, as
amended.
Bankruptcy Coverage Termination Date: The point in time at which the
Bankruptcy Loss Coverage Amount is reduced to zero.
Bankruptcy Loss: With respect to any Mortgage Loan, a Deficient
Valuation or Debt Service Reduction; provided, however, that a Bankruptcy Loss
shall not be deemed a Bankruptcy Loss hereunder so long as the Servicer has
notified the Trustee and Trust Administrator in writing that the Servicer is
diligently pursuing any remedies that may exist in connection with the related
Mortgage Loan and either (A) the related Mortgage Loan is not in default with
regard to payments due thereunder or (B) delinquent payments of principal and
interest under the related Mortgage Loan and any related escrow payments in
respect of such Mortgage Loan are being advanced on a current basis by the
Servicer, in either case without giving effect to any Debt Service Reduction or
Deficient Valuation.
Bankruptcy Loss Coverage Amount: As of any Determination Date, the
Bankruptcy Loss Coverage Amount shall equal the Initial Bankruptcy Coverage
Amount as reduced by (i) the aggregate amount of Bankruptcy Losses allocated to
the Certificates since the Cut-off Date and (ii) any permissible reductions in
the Bankruptcy Loss Coverage Amount as evidenced by a letter of each Rating
Agency to the Trustee to the effect that any such reduction will not result in a
downgrading of the then current ratings assigned to the Classes of Certificates
rated by it.
Book-Entry Certificates: As specified in the Preliminary Statement.
Business Day: Any day other than (i) a Saturday or a Sunday, or (ii)
a day on which banking institutions in the City of New York, New York, or the
cities in which the Corporate Trust Office of the Trust Administrator is located
are authorized or obligated by law or executive order to be closed.
Certificate: Any one of the Certificates executed and authenticated
by the Trustee in substantially the forms attached hereto as exhibits.
Certificate Owner: With respect to a Book-Entry Certificate, the
Person who is the beneficial owner of such Book-Entry Certificate.
Certificate Principal Balance: With respect to any Certificate 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 the sum of (i) all distributions of principal previously made with respect
thereto and (ii) all Realized Losses allocated thereto and, in the case of any
Junior Certificates, all other reductions in Certificate Principal Balance
previously allocated thereto pursuant to Section 4.03.
Certificate Register: The register maintained pursuant to Section
5.02 hereof.
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 Servicer or the Depositor or any affiliate of the Servicer or
the Depositor, as applicable, 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 Servicer or the Depositor) owns 100% of the Percentage
Interests evidenced by a Class of Certificates, such Certificates shall be
deemed to be Outstanding for purposes of any provision hereof that requires the
consent of the Holders of Certificates of a particular Class as a condition to
the taking of any action hereunder. The Trustee is entitled to rely conclusively
on a certification of the Servicer or the Depositor or any affiliate of the
Servicer or the Depositor, as applicable, in determining which Certificates are
registered in the name of an affiliate of the Servicer or the Depositor.
Class: All Certificates bearing the same class designation as set
forth in the Preliminary Statement.
Class Interest Shortfall: As to any Distribution Date and Class, the
amount by which the amount described in clause (i) of the definition of Accrued
Certificate Interest for such Class exceeds the amount of interest actually
distributed on such Class on such Distribution Date pursuant to such clause (i).
Class Prepayment Distribution Trigger: With respect to any Class of
the Class B Certificates and any Distribution Date, if the fraction, the
numerator of which is the Class Principal Balance of such Class immediately
prior to such Distribution Date and each Class subordinate thereto, and
denominator of which is the Pool Principal Balance with respect to that
Distribution Date, equals or exceeds such percentage calculated as of the
Closing Date.
Class Principal Balance: With respect to any Class and as to any
date of determination, the aggregate of the Certificate Principal Balances of
all Certificates of such Class as of such date.
Class Unpaid Interest Amounts: As to any Distribution Date and Class
of interest bearing Certificates, the amount by which the aggregate Class
Interest Shortfalls for such Class on prior Distribution Dates exceeds the
amount distributed on such Class on prior Distribution Dates pursuant to clause
(ii) of the definition of Accrued Certificate Interest.
Closing Date: September 28, 2001.
Code: The Internal Revenue Code of 1986, including any successor or
amendatory provisions.
Collection Account: The separate Eligible Account or Accounts
created and maintained by the Servicer pursuant to Section 3.05 with a
depository institution in the name of the Servicer for the benefit of the
Trustee on behalf of Certificateholders and designated "The Chase Manhattan Bank
in trust for the registered holders of MASTR Adjustable Rate Mortgages Trust
2001-1, Mortgage Pass-Through Certificates Series 2001-1."
Control Person: As defined in Section 8.05 hereof.
Corporate Trust Office: The designated office of (i) the Trustee in
the State of New York at which at any particular time its corporate trust
business with respect to this Agreement shall be administered, which office at
the date of the execution of this Agreement is located at ▇▇▇ ▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇,
▇▇▇▇ ▇▇▇▇▇, ▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇, Attention: Institutional Trust
Services/Structured Finance, and which is the address to which notices to and
correspondence with the Trustee should be directed, and (ii) the Trust
Administrator in the State of Maryland at which at any particular time its
corporate trust business with respect to this Agreement shall be administered,
which office at the date of the execution of this Agreement is located at ▇▇▇▇▇
▇▇▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇ ▇▇▇▇▇-▇▇▇▇, Attention: Corporate Trust
Services - MARM 2001-1, and which is the address to which appropriate notices to
and correspondence with the Trust Administrator should be directed.
Cross-Over Date: The Distribution Date on which the Class Principal
Balances of the Junior Certificates have been reduced to zero.
Cut-off Date: September 1, 2001.
Cut-off Date Pool Balance: $220,681,691.77.
Cut-off Date Principal Balance: As to any Mortgage Loan, the
Scheduled Principal Balance thereof as of the close of business on the Cut-off
Date.
Debt Service Reduction: With respect to any Mortgage Loan, a
reduction by a court of competent jurisdiction in a proceeding under the
Bankruptcy Code in the Scheduled Payment for such Mortgage Loan which became
final and non-appealable, except such a reduction resulting from a Deficient
Valuation or any reduction that results in a permanent forgiveness of principal.
Defective Mortgage Loan: Any Mortgage Loan which is required to be
repurchased pursuant to Section 2.02 or 2.03.
Deficient Valuation: With respect to any Mortgage Loan, a valuation
by a court of competent jurisdiction of the Mortgaged Property in an amount less
than the then-outstanding indebtedness under the Mortgage Loan, or any reduction
in the amount of principal to be paid in connection with any Scheduled Payment
that results in a permanent forgiveness of principal, which valuation or
reduction results from an order of such court which is final and non-appealable
in a proceeding under the Bankruptcy Code.
Definitive Certificates: Any Certificate evidenced by a Physical
Certificate and any Certificate issued in lieu of a Book-Entry Certificate
pursuant to Section 5.02(e).
Deleted Mortgage Loan: As defined in Section 2.03(c) hereof.
Denomination: With respect to each Certificate, the amount set forth
on the face thereof as the "Initial Certificate Principal Balance of this
Certificate" or the Percentage Interest appearing on the face thereof.
Depositor: Mortgage Asset Securitization Transactions, Inc., a
Delaware corporation, or its successor 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(3) of the Uniform Commercial Code of
the State of New York.
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: As to any Distribution Date, the Business Day
immediately preceding the Trust Administrator Account Deposit Date.
Distribution Account: The separate Eligible Account created and
maintained by the Trustee pursuant to Section 3.05 in the name of the Trustee
for the benefit of the Certificateholders and designated "The Chase Manhattan
Bank in trust for registered holders of MASTR Adjustable Rate Mortgages Trust
2001-1, Mortgage Pass-Through Certificates, Series 2001-1." Funds in the
Distribution Account shall be held in trust for the Certificateholders for the
uses and purposes set forth in this Agreement.
Distribution Account Deposit Date: As to any Distribution Date, the
immediately preceding Business Day.
Distribution Date: The 25th day of each calendar month after the
initial issuance of the Certificates, or if such 25th day is not a Business Day,
the next succeeding Business Day, commencing in October 2001.
Due Date: With respect to any Distribution Date, the first day of
the month in which the related Distribution Date occurs.
Eligible Account: A deposit account or accounts maintained with a
federal or state chartered depository institution, the deposits in which are
insured by the FDIC to the applicable limits and the short-term unsecured debt
obligations of which (or, in the case of a depository institution that is a
subsidiary of a holding company, the short-term unsecured debt obligations of
such holding company) are rated A-1 by S&P and Prime-1 by Moody's at the time
any deposits are held on deposit therein.
Eligible Substitute Mortgage Loan: A Mortgage Loan substituted by
the Originator for a Deleted Mortgage Loan which must, on the date of such
substitution, as confirmed in a Request for Release, substantially in the form
of Exhibit L, (i) have a Scheduled Principal Balance, after deduction of the
principal portion of the Scheduled Payment due in the month of substitution (or,
in the case of a substitution of more than one mortgage loan for a Deleted
Mortgage Loan, an aggregate principal balance), not in excess of, and not more
than 10% less than the Scheduled Principal Balance of the Deleted Mortgage Loan;
(ii) be accruing interest at a rate no lower than and not more than 1% per annum
higher than, that of the Deleted Mortgage Loan; (iii) have a Loan-to-Value Ratio
no higher than that of the Deleted Mortgage Loan; (iv) have a remaining term to
maturity no greater than (and not more than one year less than that of) the
Deleted Mortgage Loan; (v) comply with each representation and warranty set
forth in Section 2.03 hereof; (vi) be the same credit grade category as the
Deleted Mortgage Loan; and (vii) have the same prepayment penalty term.
ERISA: The Employee Retirement Income Security Act of 1974, as
amended.
ERISA-Restricted Certificate: As specified in the Preliminary
Statement.
Escrow Account: The Eligible Account or Accounts established and
maintained pursuant to Section 3.06(a) hereof.
Escrow Payments: With respect to any Mortgage Loan, the amounts
constituting ground rents, taxes, assessments, water rates, sewer rents,
municipal charges, mortgage insurance premiums, fire and hazard insurance
premiums, condominium charges, and any other payments required to be escrowed by
the Mortgagor with the mortgagee pursuant to the Mortgage or any other related
document.
Excess Loss: The amount of any (i) Fraud Loss realized after the
Fraud Loss Coverage Termination Date, (ii) Special Hazard Loss realized after
the Special Hazard Coverage Termination Date or (iii) Bankruptcy Loss realized
after the Bankruptcy Coverage Termination Date.
Excess Proceeds: With respect to any Liquidated Loan, the amount, if
any, by which the sum of any Liquidation Proceeds of such Mortgage Loan received
in the calendar month in which such Mortgage Loan became a Liquidated Loan,
exceeds (i) the Scheduled Principal Balance of such Liquidated Loan as of the
Due Date in the month in which such Mortgage Loan became a Liquidated Loan plus
(ii) accrued interest at the Mortgage Rate from the Due Date as to which
interest was last paid or advanced (and not reimbursed) to Certificateholders up
to the Due Date applicable to the Distribution Date immediately following the
calendar month during which such liquidation occurred.
Exchange Act: The Securities Exchange Act of 1934, as amended from
time to time.
▇▇▇▇▇▇ Mae: The Federal National Mortgage Association, a federally
chartered and privately owned corporation, or any successor thereto.
▇▇▇▇▇▇ ▇▇▇ Guide: The FNMA/▇▇▇▇▇▇ Mae Selling Guide and the
Servicing Guide, collectively, in effect on and after the ▇▇▇▇▇ Fargo Loan Sale
Date.
FDIC: The Federal Deposit Insurance Corporation, or any successor
thereto.
FIRREA: The Financial Institutions Reform, Recovery, and Enforcement
Act of 1989.
Fitch: Fitch, Inc., or any successor thereto.
Formula Principal Amount: As to any Distribution Date, the sum of
(a) the principal portion of each Scheduled Payment (without giving effect,
prior to the Bankruptcy Coverage Termination Date, to any reductions thereof
caused by any Debt Service Reductions or Deficient Valuations) due on each
Mortgage Loan on the related Due Date, (b) the Scheduled Principal Balance of
each Mortgage Loan that was repurchased by the Originator pursuant to this
Agreement as of such Distribution Date, (c) the Substitution Adjustment Amount
in connection with any Deleted Mortgage Loan received with respect to such
Distribution Date, (d) any Insurance Proceeds or Liquidation Proceeds allocable
to recoveries of principal of Mortgage Loans that are not yet Liquidated Loans
received during the calendar month preceding the month of such Distribution
Date, (e) with respect to each Mortgage Loan that became a Liquidated Loan
during the calendar month preceding the month of such Distribution Date, the
amount of the Liquidation Proceeds allocable to principal received during the
calendar month preceding the month of such Distribution Date with respect to
such Mortgage Loan and (f) the sum of (i) all Principal Prepayments in full
received during the related Prepayment Period and (ii) all partial Principal
Prepayments applied during the related Prepayment Period.
Fraud Loan: A Liquidated Loan as to which a Fraud Loss has occurred.
Fraud Loss Coverage Amount: As of the Closing Date, $6,620,448.59,
subject to reduction from time to time by the amount of Fraud Losses allocated
to the Certificates. In addition, on each anniversary of the Cut-off Date, the
Fraud Loss Coverage Amount will be reduced as follows: (a) on the first
anniversary of the Cut-off Date, to an amount equal to the lesser of (i) 2% of
the then current Pool Principal Balance and (ii) the excess of the Fraud Loss
Coverage Amount as of the preceding anniversary of the Cut-off Date over the
cumulative amount of Fraud Losses that would have been allocated to the
Certificates in the absence of the Loss Allocation Limitation since such
preceding anniversary; (b) on the second anniversary of the Cut-off Date, to an
amount equal to the lesser of (i) 1% of the then current Pool Principal Balance
and (ii) the excess of the Fraud Loss Coverage Amount as of the preceding
anniversary of the Cut-off Date over the cumulative amount of Fraud Losses that
would have been allocated to the Certificates in the absence of the Loss
Allocation Limitation since such preceding anniversary, (c) on the third and
fourth anniversaries of the Cut-off Date, to an amount equal to the lesser of
(i) 0.5% of the then current Pool Principal Balance and (ii) the excess of the
Fraud Loss Coverage Amount as of the preceding anniversary of the Cut-off Date
over the cumulative amount of Fraud Losses that would have been allocated to the
Certificates in the absence of the Loss Allocation Limitation since such
preceding anniversary; and (d) on the earlier to occur of the Cross-Over Date
and the fifth anniversary of the Cut-off Date, to zero.
Fraud Loss Coverage Termination Date: The point in time at which the
Fraud Loss Coverage Amount is reduced to zero.
Fraud Losses: Realized Losses on Mortgage Loans as to which a loss
is sustained by reason of a default arising from fraud, dishonesty or
misrepresentation in connection with the related Mortgage Loan, including a loss
by reason of the denial of coverage under any related Primary Insurance Policy
because of such fraud, dishonesty or misrepresentation.
▇▇▇▇▇▇▇ Mac: The Federal Home Loan Mortgage Corporation, a corporate
instrumentality of the United States, or any successor thereto.
▇▇▇▇▇▇▇ Mac Servicing Guide: The FHLMC/▇▇▇▇▇▇▇ Mac Seller' and
Servicers' Guide in effect on and after the ▇▇▇▇▇ Fargo Loan Sale Date.
HUD: The United States Department of Housing and Urban Development
or any successor thereto.
Indirect Participant: A broker, dealer, bank or other financial
institution or other Person that clears through or maintains a custodial
relationship with a Depository Participant.
Initial Bankruptcy Coverage Amount: $100,000.
Insolvency Proceeding: With respect to any Person: (i) any case,
action, or proceeding with respect to such Person before any court or other
governmental authority relating to bankruptcy, reorganization, insolvency,
liquidation, receivership, dissolution, winding-up, or relief of debtors; or
(ii) any general assignment for the benefit of creditors, composition,
marshaling of assets for creditors, or other, similar arrangement in respect of
the creditors generally of such Person or any substantial portion of such
Person's creditors, in any case undertaken under federal, state or foreign law,
including the Bankruptcy Code.
Insurance Policy: With respect to any Mortgage Loan included in the
Trust Fund, any insurance policy, including all riders and endorsements thereto
in effect, including any replacement policy or policies for any Insurance
Policies.
Insurance Proceeds: Proceeds paid by an insurer pursuant to any
Insurance Policy, in each case other than any amount included in such Insurance
Proceeds in respect of Insured Expenses, to the extent such proceeds are not
applied to the restoration of the related Mortgaged Property or released to the
borrower in accordance with the Servicer's normal servicing procedures.
Insured Expenses: Expenses covered by an Insurance Policy or any
other insurance policy with respect to the Mortgage Loans.
Interest Accrual Period: With respect to each Class of Certificates
and any Distribution Date, the calendar month prior to the month of such
Distribution Date.
Junior Certificates: As specified in the Preliminary Statement.
Junior Optimal Principal Amount: For any Distribution Date, the sum
of (i) the Junior Percentage of all amounts described in clauses (a) through (d)
of the definition of "Formula Principal Amount" for such Distribution Date, (ii)
with respect to each Mortgage Loan that became a Liquidated Loan during the
calendar month preceding the month of such Distribution Date, the lesser of (A)
the Junior Percentage of the Scheduled Principal Balance of such Mortgage Loan,
or (B) either (a) the Junior Prepayment Percentage, or (b) if an Excess Loss was
sustained with respect to such Liquidated Loan during such prior calendar month,
the Junior Percentage of the amount of the Liquidation Proceeds allocable to
principal received with respect to such Mortgage Loan, and (iii) the Junior
Prepayment Percentage of the amounts described in clause (f) of the definition
of "Formula Principal Amount" for such Distribution Date; provided, however,
that if a Bankruptcy Loss that is an Excess Loss is sustained with respect to a
Mortgage Loan that is not a Liquidated Loan, the Junior Optimal Principal Amount
will be reduced on the related Distribution Date by the Junior Percentage of the
principal portion of such Bankruptcy Loss.
Junior Percentage: As to any Distribution Date, 100% minus the
Senior Percentage for such Distribution Date.
Junior Prepayment Percentage: As to any Distribution Date, 100%
minus the Senior Prepayment Percentage for such Distribution Date.
Latest Possible Maturity Date: The Distribution Date following the
third anniversary of the scheduled maturity date of the Mortgage Loan having the
latest scheduled maturity date as of the Cut-off Date.
Liquidated Loan: With respect to any Distribution Date, a defaulted
Mortgage Loan (including any REO Property) which was liquidated in the calendar
month preceding the month of such Distribution Date and as to which the Servicer
has determined (in accordance with this Agreement) 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: Amounts, including Insurance Proceeds,
received in connection with the partial or complete liquidation of defaulted
Mortgage Loans, whether through trustee's sale, foreclosure sale or otherwise or
amounts received in connection with any condemnation or partial release of a
Mortgaged Property and any other proceeds received in connection with an REO
Property, less the sum of related unreimbursed Servicing Fees, Servicing
Advances and Advances.
Loan Seller: UBS Real Estate Securities Inc., a Delaware
corporation, seller of the Mortgage Loans to the Depositor pursuant to the
Mortgage Loan Purchase Agreement.
Loan-to-Value Ratio: With respect to any Mortgage Loan and as to any
date of determination, the fraction (expressed as a percentage) the numerator of
which is the principal balance of the related Mortgage Loan at such date of
determination and the denominator of which is the Appraised Value of the related
Mortgaged Property.
Loss Allocation Limitation: As defined in Section 4.03(d) hereof.
Lost Mortgage Note: Any Mortgage Note the original of which was
permanently lost or destroyed and has not been replaced.
Majority in Interest: As to any Class of Regular Certificates, the
Holders of Certificates of such Class evidencing, in the aggregate, at least 51%
of the Percentage Interests evidenced by all Certificates of such Class.
Monthly Payment: The scheduled monthly payment of principal and
interest on a Mortgage Loan which is payable by a Mortgagor under the related
Mortgage Note.
Monthly Statement: The statement delivered to the Certificateholders
pursuant to Section 4.04.
Moody's: ▇▇▇▇▇'▇ Investors Service, Inc., or any successor thereto.
If ▇▇▇▇▇'▇ is designated as a Rating Agency in the Preliminary Statement, for
purposes of Section 10.05(b) the address for notices to Moody's shall be ▇▇▇▇▇'▇
Investors Service, ▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇, Attention:
Residential Mortgage Monitoring 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 creating a
first lien on an estate in fee simple or leasehold interest in real property
securing a Mortgage Note.
Mortgage File: The mortgage documents listed in Section 2.01 hereof
pertaining to a particular Mortgage Loan and any additional documents delivered
to the Trust Administrator to be added to the Mortgage File pursuant to this
Agreement.
Mortgage Loan Schedule: The list of Mortgage Loans (as from time to
time amended by the Servicer to reflect the addition of Eligible Substitute
Mortgage Loans and the deletion of Deleted Mortgage Loans pursuant to the
provisions of this Agreement) transferred to the Trustee as part of the Trust
Fund and from time to time subject to this Agreement, attached hereto as
Schedule I, setting forth the following information with respect to each
Mortgage Loan: (1) the Mortgage Loan number; (2) the city state and zip code of
the Mortgaged Property; (3) a code indicating whether the Mortgaged Property is
a single family residence, two-family residence, three-family residence,
four-family residence, PUD or Condominium; (4) the current Mortgage Rate; (5)
the current Net Mortgage Rate; (6) the current Monthly Payment; (7) the gross
margin; (8) the original term to maturity; (9) the scheduled maturity date; (10)
the principal balance of the Mortgage Loan as of the Cut-off Date after
deduction of payments of principal due on or before the Cut-off Date whether or
not collected; (11) the Loan-to-Value Ratio; (12) the next Mortgage Rate
adjustment date; (13) the lifetime Mortgage Rate cap; (14) whether the Mortgage
Loan is convertible or not; (15) a code indicating the mortgage guaranty
insurance company; and (16) the Servicing Fee Rate.
Mortgage Loans: Such of the mortgage loans transferred and assigned
to the Trustee pursuant to the provisions hereof as from time to time are held
as a part of the Trust Fund (including any REO Property), the mortgage loans so
held being identified in the Mortgage Loan Schedule, notwithstanding foreclosure
or other acquisition of title of the related Mortgaged Property.
Mortgage Note: The original executed note or other evidence of
indebtedness evidencing the indebtedness of a Mortgagor under a Mortgage Loan.
Mortgage Rate: The annual rate of interest borne by a Mortgage Note
from time to time.
Mortgaged Property: The underlying property securing a Mortgage
Loan.
Mortgagor: The obligor(s) on a Mortgage Note.
Net Mortgage Rate: As to each Mortgage Loan, and at any time, the
per annum rate equal to the Mortgage Rate less the related Servicing Fee Rate.
Net Prepayment Interest Shortfalls: As to any Distribution Date, the
amount by which the aggregate of Prepayment Interest Shortfalls during the
related Prepayment Period exceeds an amount equal to the amount deposited by the
Servicer into the Collection Account pursuant to Section 3.05(b)(viii) on such
Distribution Date.
Non-PO Percentage: As to any Discount Mortgage Loan, a fraction
(expressed as a percentage) the numerator of which is the Net Mortgage Rate of
such Discount Mortgage Loan and the denominator of which is the Required Coupon.
As to any Non-Discount Mortgage Loan, 100%.
Nonrecoverable Advance: Any portion of an Advance previously made or
proposed to be made by the Servicer that, in the good faith judgment of the
Servicer, will not be ultimately recoverable by the Servicer from the related
Mortgagor, related Liquidation Proceeds or otherwise.
Notice of Final Distribution: The notice to be provided pursuant to
Section 9.02 to the effect that final distribution on any of the Certificates
shall be made only upon presentation and surrender thereof.
Offered Certificates: As specified in the Preliminary Statement.
Officer's Certificate: A certificate (i) signed by the Chairman of
the Board, the Vice Chairman of the Board, the President, a Managing Director, a
Vice President (however denominated), an Assistant Vice President, the
Treasurer, the Secretary, or one of the Assistant Treasurers or Assistant
Secretaries of the Depositor or the Servicer, or (ii), if provided for in this
Agreement, signed by a Servicing Officer, as the case may be, and delivered to
the Depositor, the Trustee and the Trust Administrator, as the case may be, as
required by this Agreement.
Opinion of Counsel: A written opinion of counsel, who may be counsel
for the Depositor or the Servicer, including, in-house counsel, reasonably
acceptable to the Trust Administrator and the Trustee; provided, however, that
with respect to the interpretation or application of the REMIC Provisions, such
counsel must (i) in fact be independent of the Depositor and the Servicer, (ii)
not have any direct financial interest in the Depositor or the Servicer or in
any affiliate of either, and (iii) not be connected with the Depositor or the
Servicer as an officer, employee, promoter, underwriter, trustee, partner,
director or person performing similar functions.
Optional Termination: The termination of the trust created hereunder
in connection with the purchase of the Mortgage Loans pursuant to Section
9.01(a) hereof.
Original Junior Principal Balance: The aggregate of the Class
Principal Balances of the Junior Certificates as of the Closing Date.
Originator: ▇▇▇▇▇ Fargo Home Mortgage, Inc., in its capacity as
seller of Mortgage Loans to the Loan Seller.
OTS: The Office of Thrift Supervision.
Outstanding: With respect to the Certificates as of any date of
determination, all Certificates theretofore executed and authenticated under
this Agreement except:
(i) Certificates theretofore canceled by the Trustee or delivered to
the Trustee for cancellation; and
(ii) Certificates in exchange for which or in lieu of which other
Certificates have been executed and delivered by the Trustee pursuant to
this Agreement.
Outstanding Mortgage Loan: As of any Due Date, a Mortgage Loan with
a Scheduled 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 Loan prior to such Due Date.
Ownership Interest: As to any Residual Certificate, any ownership
interest in such Certificate including any interest in such Certificate as the
Holder thereof and any other interest therein, whether direct or indirect, legal
or beneficial.
Pass-Through Rate: For any interest bearing Class of Certificates,
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: At any time, any one or more of the following
obligations and securities:
(i) obligations of the United States or any agency thereof, provided
such obligations are backed by the full faith and credit of the United
States;
(ii) general obligations of or obligations guaranteed by any state
of the United States or the District of Columbia receiving the highest
long-term debt rating of each Rating Agency, or such lower rating as will
not result in the downgrading or withdrawal of the ratings then assigned
to the Certificates by each Rating Agency;
(iii) commercial or finance company paper which is then receiving
the highest commercial or finance company paper rating of each Rating
Agency, or such lower rating as will not result in the downgrading or
withdrawal of the ratings then assigned to the Certificates by each Rating
Agency;
(iv) certificates of deposit, demand or time deposits, or bankers'
acceptances issued by any depository institution or trust company
incorporated under the laws of the United States or of any state thereof
and subject to supervision and examination by federal and/or state banking
authorities, provided that the commercial paper and/or long term unsecured
debt obligations of such depository institution or trust company (or in
the case of the principal depository institution in a holding company
system, the commercial paper or long-term unsecured debt obligations of
such holding company) are then rated in the highest long-term and the
highest short-term ratings of each Rating Agency for such securities, or
such lower ratings as will not result in the downgrading or withdrawal of
the rating then assigned to the Certificates by either Rating Agency;
(v) demand or time deposits or certificates of deposit issued by any
bank or trust company or savings institution to the extent that such
deposits are fully insured by the FDIC and are then rated in the highest
long-term and the highest short-term ratings of each Rating Agency for
such securities, or such lower ratings as will not result in the
downgrading or withdrawal of the ratings then assigned to the Certificates
by either Rating Agency;
(vi) guaranteed reinvestment agreements issued by any bank,
insurance company or other corporation containing, at the time of the
issuance of such agreements, such terms and conditions as will not result
in the downgrading or withdrawal of the rating then assigned to the
Certificates by either Rating Agency;
(vii) repurchase obligations with respect to any security described
in clauses (i) and (ii) above, in either case entered into with a
depository institution or trust company (acting as principal) described in
clause (iv) above;
(viii) securities (other than stripped bonds, stripped coupons or
instruments sold at a purchase price in excess of 115% of the face amount
thereof) bearing interest or sold at a discount issued by any corporation
incorporated under the laws of the United States or any state thereof
which, at the time of such investment, have the highest rating of each
Rating Agency, or such lower rating as will not result in the downgrading
or withdrawal of the rating then assigned to the Certificates by either
Rating Agency, as evidenced by a signed writing delivered by each Rating
Agency;
(ix) units of a taxable money-market portfolio having the highest
rating assigned by each Rating Agency and restricted to obligations issued
or guaranteed by the United States of America or entities whose
obligations are backed by the full faith and credit of the United States
of America and repurchase agreements collateralized by such obligations;
(x) any mutual fund, money market fund, common trust fund or other
pooled investment vehicle, the assets of which are limited to instruments
that otherwise would constitute Permitted Investments hereunder, including
any such fund that is managed by the Trust Administrator or the Trustee or
any affiliate of the Trust Administrator or the Trustee or for which the
Trust Administrator or the Trustee or any of their affiliates acts as an
adviser as long as such fund is rated in at least the highest rating
category by Moody's or S&P; and
(xi) such other investments bearing interest or sold at a discount
acceptable to each Rating Agency as will not result in the downgrading or
withdrawal of the rating then assigned to the Certificates by either
Rating Agency, as evidenced by a signed writing delivered by each Rating
Agency.
provided that no such instrument shall be a Permitted Investment if such
instrument evidences the right to receive interest only payments with respect to
the obligations underlying such instrument.
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)(l) 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
citizen or resident of the United States, a corporation, partnership (except as
provided in applicable Treasury Regulations), or other entity created or
organized in or under the laws of the United States or any political subdivision
thereof, an estate whose income is subject to United States federal income tax
purposes regardless of its source or a trust if a court within the United States
is able to exercise primary supervision over the administration of the trust and
one or more persons described in this clause (v) have the authority to control
all substantial decisions of the trust (or, to the extent provided in applicable
Treasury Regulations, certain trusts in existence on August 20, 1996 which are
eligible to elect to be treated as United States persons) unless such Person has
furnished the Originator and the Trustee with a duly completed Internal Revenue
Service Form W-8ECI or any applicable successor form, and (vi) 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 the REMIC hereunder 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 Federal Home Loan Mortgage Corporation, a majority of its
board of directors is not selected by such government unit.
Person: Any individual, corporation, partnership, limited liability
company, joint venture, association, joint-stock company, trust, unincorporated
organization or government, or any agency or political subdivision thereof.
Physical Certificate: As specified in the Preliminary Statement.
Pool Principal Balance: As to any Distribution Date, the aggregate
of the Scheduled Principal Balances of the Mortgage Loans which were Outstanding
Mortgage Loans on the Due Date in the month preceding the month of such
Distribution Date.
Prepayment Interest Shortfall: As to any Distribution Date, Mortgage
Loan and Principal Prepayment received on or before the last day of the month
preceding the month of such Distribution Date, the amount, if any, by which one
month's interest at the related Mortgage Rate, net of the Servicing Fee Rate, on
such Principal Prepayment exceeds the amount of interest paid in connection with
such Principal Prepayment.
Prepayment Period: As to any Distribution Date, the calendar month
preceding the month of such Distribution Date.
Primary Insurance Policy: Each policy of primary mortgage guaranty
insurance or any replacement policy therefor with respect to any Mortgage Loan.
Principal Prepayment: Any payment of principal by a Mortgagor on a
Mortgage Loan that is received in advance of its scheduled Due Date and is not
accompanied by an amount representing scheduled interest due on any date or
dates in any month or months subsequent to the month of prepayment. Partial
Principal Prepayments shall be applied by the Servicer in accordance with the
terms of the related Mortgage Note, and to the extent the Mortgage Note does not
provide otherwise, shall be applied in the Prepayment Period preceding the
receipt thereof.
Principal Prepayment in Full: Any Principal Prepayment made by a
Mortgagor of the entire principal balance of a Mortgage Loan.
Private Certificate: As specified in the Preliminary Statement.
Pro Rata Junior Percentage: As to any Distribution Date, the
percentage equivalent of a fraction, the numerator of which is the aggregate of
the Certificate Principal Balances of all classes of Junior Certificates
immediately prior to that date and the denominator of which is the aggregate of
the Certificate Principal Balances of all classes of Certificates for that date.
Pro Rata Senior Percentage: As to any Distribution Date, the
percentage equivalent of a fraction, the numerator of which is the aggregate of
the Certificate Principal Balances of all classes of Senior Certificates
immediately prior to that date and the denominator of which is the aggregate of
the Certificate Principal Balances of all classes of Certificates for that date.
Pro Rata Share: As to any Distribution Date and any Mortgage Loan
and with respect to each Class of Certificates the product of (a) the lesser of
(I) the ratio that the Required Coupon bears to such Net Mortgage Rate and (II)
one, multiplied by (b) the ratio that the amount calculated with respect to such
Distribution Date for such Class pursuant to clause (i) of the definition of
Accrued Certificate Interest (without giving effect to any reduction of such
amount pursuant to Section 4.02(d)) bears to the amount calculated with respect
to such Distribution Date for all Class of Certificates pursuant to clause (i)
of the definition of Accrued Certificate Interest (without giving effect to any
reduction of such amount pursuant to Section 4.02(d)).
Prospectus Supplement: The Prospectus Supplement dated September 26,
2001 relating to the Offered Certificates.
PUD: Planned Unit Development.
Purchase Price: With respect to any Mortgage Loan required to be
purchased by the Originator pursuant to Section 2.02 or 2.03 hereof, an amount
equal to the sum of (i) 100% of the unpaid principal balance of the Mortgage
Loan on the date of such purchase, and (ii) accrued and unpaid interest thereon
at the applicable Mortgage Rate from the date through which interest was last
paid by the Mortgagor or the Servicer made an Advance in respect thereof (which
was not reimbursed) to the Due Date in the month in which the Purchase Price is
to be distributed to Certificateholders.
Qualified Insurer: A mortgage guaranty insurance company duly
authorized and licensed where required by law to transact mortgage guaranty
insurance business and approved as an insurer by ▇▇▇▇▇▇ ▇▇▇ or ▇▇▇▇▇▇▇ Mac.
Rating Agency: Each of the Rating Agencies specified in the
Preliminary Statement. If any 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 Trust
Administrator. References herein to a given rating category of a Rating Agency
shall mean such rating category without giving effect to any modifiers.
Realized Loss: With respect to each Liquidated Loan, an amount (not
less than zero or more than the Scheduled Principal Balance of the Mortgage
Loan) as of the date of such liquidation, equal to (i) the Scheduled Principal
Balance of the Liquidated Loan as of the date of such liquidation, plus (ii)
interest at the Net Mortgage Rate from the Due Date as to which interest was
last paid or advanced (and not reimbursed) to Certificateholders up to the Due
Date in the month in which Liquidation Proceeds are required to be distributed
on the Scheduled Principal Balance of such Liquidated Loan from time to time,
minus (iii) the Liquidation Proceeds, if any, received during the month in which
such liquidation occurred, to the extent applied as recoveries of interest at
the Net Mortgage Rate and to principal of the Liquidated Loan. With respect to
each Mortgage Loan which has become the subject of a Deficient Valuation, if the
principal amount due under the related Mortgage Note has been reduced, the
difference between the principal balance of the Mortgage Loan outstanding
immediately prior to such Deficient Valuation and the principal balance of the
Mortgage Loan as reduced by the Deficient Valuation. With respect to each
Mortgage Loan which has become the subject of a Debt Service Reduction and any
Distribution Date, the amount, if any, by which the principal portion of the
related Scheduled Payment has been reduced.
Record Date: With respect to any Distribution Date, the close of
business on the last Business Day of the month preceding the month in which such
Distribution Date occurs.
Refinancing Mortgage Loan: Any Mortgage Loan originated in
connection with the refinancing of an existing mortgage loan.
Regular Certificates: As specified in the Preliminary Statement.
Relief Act: The Soldiers' and Sailors' Civil Relief Act of 1940, as
amended.
Relief Act Reductions: With respect to any Distribution Date and any
Mortgage Loan as to which there has been a reduction in the amount of interest
collectible thereon for the most recently ended calendar month as a result of
the application of the Relief Act, the amount, if any, by which (i) interest
collectible on such Mortgage Loan for the most recently ended calendar month is
less than (ii) interest accrued thereon for such month pursuant to the Mortgage
Note.
REMIC: A "real estate mortgage investment conduit" within the
meaning of section 860D of the Code.
REMIC Change of Law: Any proposed, temporary or final regulation,
revenue ruling, revenue procedure or other official announcement or
interpretation relating to REMICs and the REMIC Provisions issued after the
Closing Date.
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.
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.
Request for Release: The Request for Release submitted by the
Servicer to the Trust Administrator, substantially in the form of Exhibit L.
Required Insurance Policy: With respect to any Mortgage Loan, any
insurance policy that is required to be maintained from time to time under this
Agreement.
Residual Certificates: As specified in the Preliminary Statement.
Responsible Officer: When used with respect to the Trustee or the
Trust Administrator, any Vice President, any Assistant Vice President, the
Secretary, any Assistant Secretary, any Trust Officer or any other officer of
the Trustee or the Trust Administrator customarily performing functions similar
to those performed by any of the above designated officers having direct
responsibility for the administration of this Agreement and also 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.
Restricted Classes: As defined in Section 4.02(e).
Scheduled Payment: The scheduled monthly payment on a Mortgage Loan
due on any Due Date allocable to principal and/or interest on such Mortgage Loan
which, unless otherwise specified herein, shall give effect to any related Debt
Service Reduction and any Deficient Valuation that affects the amount of the
monthly payment due on such Mortgage Loan.
Scheduled Principal Balance: As to any Mortgage Loan and Due Date,
the unpaid principal balance of such Mortgage Loan as of such Due Date as
specified in the amortization schedule at the time relating thereto (before any
adjustment to such amortization schedule by reason of any moratorium or similar
waiver or grace period) after giving effect to any previous partial Principal
Prepayments and Liquidation Proceeds allocable to principal (other than with
respect to any Liquidated Loan), and to the payment of principal due on such Due
Date and irrespective of any delinquency in payment by the related Mortgagor.
Securities Act: The Securities Act of 1933, as amended.
Seller's Warranties and Servicing Agreement: The Seller's Warranties
and Servicing Agreement, dated as of September 1, 2001, between the Originator
and the Loan Seller, as the same may be amended from time to time.
Senior Certificates: As specified in the Preliminary Statement.
Senior Optimal Principal Amount: For any Distribution Date, the sum
of (i) the Senior Percentage of all amounts described in clauses (a) through (d)
of the definition of "Formula Principal Amount" for such Distribution Date, (ii)
with respect to each Mortgage Loan that became a Liquidated Loan during the
calendar month preceding the month of such Distribution Date, the lesser of (A)
the Senior Percentage of the Scheduled Principal Balance of such Mortgage Loan,
or (B) either (a) the Senior Prepayment Percentage, or (b) if an Excess Loss was
sustained with respect to such Liquidated Loan during such prior calendar month,
the Senior Percentage of the amount of the Liquidation Proceeds allocable to
principal received with respect to such Mortgage Loan, and (iii) the Senior
Prepayment Percentage of the amounts described in clause (f) of the definition
of "Formula Principal Amount" for such Distribution Date; provided, however,
that if a Bankruptcy Loss that is an Excess Loss is sustained with respect to a
Mortgage Loan that is not a Liquidated Loan, the Senior Optimal Principal Amount
will be reduced on the related Distribution Date by the Senior Percentage of the
principal portion of such Bankruptcy Loss.
Senior Percentage: (i) For any Distribution Date occurring on or
after the tenth anniversary of the first Distribution Date or for any
Distribution Date occurring on or after the third anniversary of the first
Distribution Date on which the Two Times Test is satisfied, the Pro Rata Senior
Percentage; or (ii) for any Distribution Date occurring before the third
anniversary of the first Distribution Date on which the Two Times Test is
satisfied, the Pro Rata Senior Percentage plus 50% of an amount equal to 100%
minus the Pro Rata Senior Percentage; or (iii) in all other cases or if the
Senior Percentage is greater than 100%, 100%.
Senior Prepayment Percentage: For any Distribution Date during the
ten years beginning on the first Distribution Date, 100%. The Senior Prepayment
Percentage for any Distribution Date occurring on or after the tenth anniversary
of the first Distribution Date will, except as provided herein, be as follows:
for any Distribution Date in the first year thereafter, the Senior Percentage
plus 70% of the Pro Rata Junior Percentage for such Distribution Date; for any
Distribution Date in the second year thereafter, the Senior Percentage plus 60%
of the Pro Rata Junior Percentage for such Distribution Date; for any
Distribution Date in the third year thereafter, the Senior Percentage plus 40%
of the Pro Rata Junior Percentage for such Distribution Date; for any
Distribution Date in the fourth year thereafter, the Senior Percentage plus 20%
of the Pro Rata Junior Percentage for such Distribution Date; and for any
Distribution Date thereafter, the Senior Percentage for such Distribution Date
(unless on any Distribution Date the Senior Percentage exceeds the initial
Senior Percentage, in which case the Senior Prepayment Percentage for such
Distribution Date will once again equal 100%); provided, that if, on any
Distribution Date occurring after the tenth anniversary of the first
Distribution Date, the Pro Rata Senior Percentage exceeds the Pro Rata Senior
Percentage on the Closing Date, the Senior Prepayment Percentage for that date
will equal 100%; and provided, further, that if, on any Distribution Date, the
Two Times Test is satisfied, the Senior Prepayment Percentage will equal the
Senior Percentage for that date. Notwithstanding the foregoing, no decrease in
the Senior Prepayment Percentage will occur unless both of the Senior Step Down
Conditions are satisfied.
Senior Step Down Conditions: As of the last day of the month
preceding the applicable Distribution Date as to which any decrease in the
Senior Prepayment Percentage applies, (i) the aggregate Scheduled Principal
Balance of all Mortgage Loans delinquent 60 days or more, as a percentage of the
aggregate principal balance of the Junior Certificates on such Distribution
Date, does not equal or exceed 50% and (ii) cumulative Realized Losses with
respect to the Mortgage Loans do not exceed (a) with respect to the Distribution
Date on the tenth anniversary of the first Distribution Date, 30% of the
Original Junior Principal Balance, (b) with respect to the Distribution Date on
the eleventh anniversary of the first Distribution Date, 35% of the Original
Junior Principal Balance, (c) with respect to the Distribution Date on the
twelfth anniversary of the first Distribution Date, 40% of the Original Junior
Principal Balance, (d) with respect to the Distribution Date on the thirteenth
anniversary of the first Distribution Date, 45% of the Original Junior Principal
Balance and (e) with respect to the Distribution Date on or after the fourteenth
anniversary of the first Distribution Date, 50% of the Original Junior Principal
Balance.
Servicer: ▇▇▇▇▇ Fargo Home Mortgage, Inc., a California corporation,
and its successors and assigns, in its capacity as servicer hereunder.
Servicer Advance Date: As to any Distribution Date, the Business Day
immediately preceding the Trust Administrator Account Deposit Date.
Servicer Event of Termination: As defined in Section 7.01 hereof.
Servicing Advances: All customary, reasonable and necessary "out of
pocket" costs and expenses (including reasonable attorneys' fees and
disbursements) incurred in the performance by the Servicer of its servicing
obligations, including, but not limited to, the cost of (i) the preservation,
restoration and protection of a Mortgaged Property, (ii) any expenses
reimbursable to the Servicer pursuant to Section 3.11 and any enforcement or
judicial proceedings, including foreclosures, (iii) the management and
liquidation of any REO Property and (iv) compliance with the obligations under
Section 3.09.
Servicing Fee: As to each Mortgage Loan and any Distribution Date,
an amount payable out of each full payment of interest received on such Mortgage
Loan and equal to one-twelfth of the Servicing Fee Rate multiplied by the
Scheduled Principal Balance of such Mortgage Loan as of the Due Date in the
month of such Distribution Date (prior to giving effect to any Scheduled
Payments due on such Mortgage Loan on such Due Date).
Servicing Fee Rate: With respect to each Mortgage Loan, 0.375% per
annum.
Servicing Officer: Any officer of the Servicer involved in, or
responsible for, the administration and servicing of the Mortgage Loans whose
name and facsimile signature appear on a list of servicing officers furnished to
the Trust Administrator by the Servicer on the Closing Date pursuant to this
Agreement, as such list may from time to time be amended.
Similar Law: As defined in Section 5.02(b) hereof.
S&P: Standard & Poor's, a division of The ▇▇▇▇▇▇-▇▇▇▇ Companies,
Inc. If S&P is designated as a Rating Agency in the Preliminary Statement, for
purposes of Section 10.05(b) the address for notices to S&P shall be Standard &
Poor's, ▇▇ ▇▇▇▇▇▇▇▇, ▇▇▇▇ ▇▇▇▇▇, ▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇, Attention: Mortgage
Surveillance Monitoring, or such other address as S&P may hereafter furnish to
the Depositor and the Servicer.
Special Hazard Coverage Termination Date: The point in time at which
the Special Hazard Loss Coverage Amount is reduced to zero.
Special Hazard Loss: Any Realized Loss suffered by a Mortgaged
Property on account of direct physical loss but not including (i) any loss of a
type covered by a hazard insurance policy or a flood insurance policy required
to be maintained with respect to such Mortgaged Property pursuant to Section
3.09 to the extent of the amount of such loss covered thereby, or (ii) any loss
caused by or resulting from:
(a) normal wear and tear;
(b) fraud, conversion or other dishonest act on the part of the
Trustee, the Trust Administrator, the Servicer or any of their agents or
employees (without regard to any portion of the loss not covered by any
errors and omissions policy);
(c) errors in design, faulty workmanship or faulty materials, unless
the collapse of the property or a part thereof ensues and then only for
the ensuing loss;
(d) nuclear or chemical reaction or nuclear radiation or radioactive
or chemical contamination, all whether controlled or uncontrolled, and
whether such loss be direct or indirect, proximate or remote or be in
whole or in part caused by, contributed to or aggravated by a peril
covered by the definition of the term "Special Hazard Loss";
(e) hostile or warlike action in time of peace and war, including
action in hindering, combating or defending against an actual, impending
or expected attack:
1. by any government or sovereign power, de jure or de
facto, or by any authority maintaining or using
military, naval or air forces; or
2. by military, naval or air forces; or
3. by an agent of any such government, power, authority or
forces;
(f) any weapon of war employing nuclear fission, fusion or
other radioactive force, whether in time of peace or war; or
(g) insurrection, rebellion, revolution, civil war, usurped power or
action taken by governmental authority in hindering, combating or
defending against such an occurrence, seizure or destruction under
quarantine or customs regulations, confiscation by order of any government
or public authority or risks of contraband or illegal transportation or
trade.
Special Hazard Loss Coverage Amount: With respect to the first
Distribution Date, $7,723,856.69, less (i) the aggregate amount of Special
Hazard Losses that would have been previously allocated to the Junior
Certificates in the absence of the Loss Allocation Limitation and (ii) the
Adjustment Amount. All principal balances for the purpose of this definition
will be calculated as of the first day of the calendar month preceding the month
of such Distribution Date after giving effect to Scheduled Payments on the
Mortgage Loans then due, whether or not paid. As of any Distribution after the
Cross-Over Date, the Special Hazard Loss Coverage Amount will be zero.
Special Hazard Mortgage Loan: A Liquidated Loan as to which a
Special Hazard Loss has occurred.
Startup Day: The Closing Date.
Subservicer: Any person to whom the Servicer has contracted for the
servicing of all or a portion of the Mortgage Loans pursuant to Section 3.02
hereof.
Substitution Adjustment Amount: The meaning ascribed to such term
pursuant to Section 2.03.
Tax Matters Person: The person designated as "tax matters person" in
the manner provided under Treasury Regulations Section 1.860F-4(d) and Treasury
Regulations Section 301.6231(a)(7)-1.
Transfer: Any direct or indirect transfer or sale of any Ownership
Interest in a Residual Certificate.
Trust: As defined in Section 2.01(c).
Trust Administrator: ▇▇▇▇▇ Fargo Bank Minnesota, N.A., a national
banking association, and its successors and, if a successor Trust Administrator
is appointed hereunder, such successor.
Trust Administrator Account: The separate Eligible Account created
and maintained by the Trust Administrator pursuant to Section 3.05 in the name
of the Trustee for the benefit of the Certificateholders and designated "The
Chase Manhattan Bank in trust for registered holders of MASTR Asset
Securitization Adjustable Rate Mortgages Trust 2001-1, Mortgage Pass-Through
Certificates, Series 2001-1." Funds in the Trust Administrator Account shall be
held in trust for the Certificateholders for the uses and purposes set forth in
this Agreement.
Trust Administrator Account Deposit Date: As to any Distribution
Date, the 18th day of each calendar month, or if such 18th day is not a Business
Day the next succeeding Business Day.
Trust Fund: The corpus of the trust created hereunder consisting of
(i) the Mortgage Loan Purchase Agreement, (ii) the Mortgage Loans and all
interest and principal received on or with respect thereto after the Cut-off
Date to the extent not applied in computing the Cut-off Date Principal Balance
thereof; (iii) the Collection Account and the Distribution Account 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; and (v) all proceeds of the
conversion, voluntary or involuntary, of any of the foregoing.
Trustee: The Chase Manhattan Bank, a New York banking corporation,
and its successors and, if a successor trustee is appointed hereunder, such
successor.
Two Times Test: The Two Times Test is satisfied on any Distribution
Date on which:
(a) the Pro Rata Junior Percentage is greater than or equal to two
times the Pro Rata Junior Percentage as of the Closing Date;
(b) the aggregate Scheduled Principal Balance of Mortgage Loans
delinquent 60 days or more (including for this purpose any Mortgage Loans in
foreclosure and Mortgage Loans with respect to REO Properties) does not equal
or exceed 50% of the aggregate Certificate Principal Balances of the Junior
Certificates as of that date; and
(c) cumulative Realized Losses do not exceed 30% of the aggregate
Original Junior Principal Balance.
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, the Voting Rights shall be allocated among Holders of the Classes
of Certificates in proportion to the Certificate Principal Balances of their
respective Certificates on such date.
▇▇▇▇▇ Fargo Loan Sale Date: The date that the Loan Seller purchased
the Mortgage Loans from the Originator pursuant to the Seller's Warranties and
Servicing Agreement.
Section 1.02. Certain Calculations.
--------------------
Unless otherwise specified herein, for purposes of determining
amounts with respect to the Certificates and the rights and obligations of the
parties hereto, all calculations of interest (other than as provided in the
Mortgage Loan documents) provided for herein shall be made on the basis of a
360-day year consisting of twelve 30-day months.
ARTICLE II
CONVEYANCE OF MORTGAGE LOANS; REPRESENTATIONS AND WARRANTIES
Section 2.01. Conveyance of Mortgage Loans.
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(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 together
with all rights assigned by the Loan Seller to the Depositor, pursuant to the
Mortgage Loan Purchase Agreement and under the Seller's Warranties and Servicing
Agreement solely with respect to the Mortgage Loans. With respect to any
Mortgage Loan that does not have a first payment date on or before the Due Date
in the month of the first Distribution Date, the Depositor shall, or shall cause
the Loan Seller to, deposit into the Distribution Account on or before the
Distribution Account Deposit Date relating to the first Distribution Date, an
amount equal to one month's interest at the related Adjusted Mortgage Rate on
the Cut-off Date Principal Balance of such Mortgage Loan.
(b) In connection with the transfer and assignment set forth in
clause (a) above, the Depositor has delivered or caused to be delivered to the
Trust Administrator, on behalf of the Trustee, for the benefit of the
Certificateholders the following documents or instruments with respect to each
Mortgage Loan so assigned:
(i) the original Mortgage Note endorsed by manual or facsimile
signature in blank in the following form: "Pay to the order of ___________
without recourse," with all intervening endorsements showing a complete
chain of endorsement from the originator to the Person endorsing the
Mortgage Note (each such endorsement being 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, with respect to any
Lost Mortgage Note, a lost note affidavit from the Originator stating that
the original Mortgage Note was lost or destroyed, together with a copy of
such Mortgage Note;
(ii) except as provided below, the original recorded Mortgage or a
copy of such Mortgage certified by the Originator as being a true and
complete copy of the Mortgage;
(iii) a duly executed assignment of the Mortgage (which may be
included in a blanket assignment or assignments), endorsed in the
following form: "The Chase Manhattan Bank as Trustee for the MARM
Adjustable Rate Mortgages Trust 2001-1 for the benefit of the Holders of
the Mortgage Pass-Through Certificates, Series 2001-1" together with,
except as provided below, all interim recorded assignments of such
mortgage (each such assignment, when duly and validly completed, to be in
recordable form and sufficient to effect the assignment of and transfer to
the assignee thereof, under the Mortgage to which the assignment relates);
provided that, if the related Mortgage has not been returned from the
applicable public recording office, such assignment of the Mortgage may
exclude the information to be provided by the recording office;
(iv) the original or copies of each assumption, modification,
written assurance or substitution agreement, if any;
(v) except as provided below, the original or duplicate original
lender's title policy and all riders thereto.
In the event that in connection with any Mortgage Loan the Depositor
cannot deliver (a) the original recorded Mortgage, (b) all interim recorded
assignments or (c) the lender's title policy (together with all riders thereto)
satisfying the requirements of clause (ii), (iii) or (v) above, respectively,
concurrently with the execution and delivery hereof because such document or
documents have not been returned from the applicable public recording office in
the case of clause (ii) or (iii) above, or because the title policy has not been
delivered to either the Servicer or the Depositor by the applicable title
insurer in the case of clause (v) above, the Depositor shall promptly deliver to
the Trust Administrator, in the case of clause (ii) or (iii) above, such
original Mortgage or such interim assignment, as the case may be, with evidence
of recording indicated thereon upon receipt thereof from the public recording
office, or a copy thereof, certified, if appropriate, by the relevant recording
office, but in no event shall any such delivery of the original Mortgage and
each such interim assignment or a copy thereof, certified, if appropriate, by
the relevant recording office, be made later than one year following the Closing
Date, or, in the case of clause (v) above, no later than 120 days following the
Closing Date; provided, however, in the event the Depositor is unable to deliver
by such date each Mortgage and each such interim assignment by reason of the
fact that any such documents have not been returned by the appropriate recording
office, or, in the case of each such interim assignment, because the related
Mortgage has not been returned by the appropriate recording office, the
Depositor shall deliver such documents to the Trust Administrator as promptly as
possible upon receipt thereof and, in any event, within 720 days following the
Closing Date. The Depositor shall forward or cause to be forwarded to the Trust
Administrator (a) from time to time additional original documents evidencing an
assumption or modification of a Mortgage Loan and (b) any other documents
required to be delivered by the Depositor or the Servicer to the Trust
Administrator. In the event that the original Mortgage is not delivered and in
connection with the payment in full of the related Mortgage Loan and the public
recording office requires the presentation of a "lost instruments affidavit and
indemnity" or any equivalent document, because only a copy of the Mortgage can
be delivered with the instrument of satisfaction or reconveyance, the Servicer
shall execute and deliver or cause to be executed and delivered such a document
to the public recording office. In the case where a public recording office
retains the original recorded Mortgage or in the case where a Mortgage is lost
after recordation in a public recording office, the Originator shall deliver to
the Trust Administrator a copy of such Mortgage certified by such public
recording office to be a true and complete copy of the original recorded
Mortgage.
As promptly as practicable subsequent to such transfer and
assignment, and in any event, within thirty (30) days thereafter, the Servicer
shall (i) cause the Trust Administrator to affix the Trustee's name to each
assignment of Mortgage, as the assignee thereof, (ii) cause such assignment to
be in proper form for recording in the appropriate public office for real
property records and (iii) cause to be delivered for recording in the
appropriate public office for real property records the assignments of the
Mortgages to the Trustee, except that, with respect to any assignments of
Mortgage as to which the Servicer has not received the information required to
prepare such assignment in recordable form, the Servicer's obligation to do so
and to deliver the same for such recording shall be as soon as practicable after
receipt of such information and in any event within thirty (30) days after
receipt thereof and that the Servicer need not cause to be recorded any
assignment which relates to a Mortgage Loan (a) the Mortgaged Property and
Mortgage File relating to which are located in California or (b) in any other
jurisdiction under the laws of which in the opinion of counsel the recordation
of such assignment is not necessary to protect the Trustee's and the
Certificateholders' interest in the related Mortgage Loan.
In the case of Mortgage Loans that have been prepaid in full as of
the Closing Date, the Depositor, in lieu of delivering the above documents to
the Trust Administrator, will deposit in the Collection Account the portion of
such payment that is required to be deposited in the Collection Account pursuant
to Section 3.08 hereof.
(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 "MASTR Adjustable Rate
Mortgages Trust 2001-1" and The Chase Manhattan Bank is hereby appointed as
Trustee in accordance with the provisions of this Agreement.
Section 2.02. Acceptance by Trust Administrator of the Mortgage
Loans.
--------------------------------------------------
The Trust Administrator on behalf of the Trustee acknowledges
receipt of the documents identified in the Initial Certification in the form
annexed hereto as Exhibit F and declares that it holds and will hold such
documents and the other documents delivered to it constituting the Mortgage
Files, and that it holds or will hold such other assets as are included in the
Trust Fund, in trust for the exclusive use and benefit of all present and future
Certificateholders. The Trust Administrator acknowledges that it will maintain
possession of the Mortgage Notes in the State of Minnesota, unless otherwise
permitted by the Rating Agencies.
The Trust Administrator agrees to execute and deliver on the Closing
Date to the Depositor, the Servicer and the Originator an Initial Certification
in the form annexed hereto as Exhibit F. Based on its review and examination,
and only as to the documents identified in such Initial Certification, the Trust
Administrator acknowledges, subject to any applicable exceptions noted on
Exhibit F, that such documents appear regular on their face and relate to such
Mortgage Loan. The Trust Administrator shall be under no duty or obligation to
(i) inspect, review or examine said documents, instruments, certificates or
other papers to determine that the same are genuine, enforceable or appropriate
for the represented purpose or that they have actually been recorded in the real
estate records or that they are other than what they purport to be on their face
or (ii) determine whether the Mortgage File should include any of the documents
specified in Section 2.01(b)(iv) unless the Mortgage Loan Schedule indicates
that such documents are applicable.
Not later than 90 days after the Closing Date, the Trust
Administrator shall deliver to the Depositor, the Servicer and the Originator a
Final Certification in the form annexed hereto as Exhibit G, with any applicable
exceptions noted thereon. The Trust Administrator shall make available, upon
request of any Certificateholder, a copy of any exceptions noted on the Initial
Certification or the Final Certification.
If, in the course of such review, the Trust Administrator finds any
document constituting a part of a Mortgage File which does not meet the
requirements of Section 2.01, the Trust Administrator shall list such as an
exception in the Final Certification; provided, however, that the Trust
Administrator shall not make any determination 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, (ii)
any assignment is in recordable form or is sufficient to effect the assignment
of and transfer to the assignee thereof under the mortgage to which the
assignment relates or (iii) the Mortgage File should include any of the
documents specified in Section 2.01(b)(iv) unless the Mortgage Loan Schedule
indicates that such documents are applicable. The Originator shall promptly
correct or cure such defect within 90 days from the date it was so notified of
such defect and, if the Originator does not correct or cure such defect within
such period, the Originator shall either (a) substitute for the related Mortgage
Loan a Eligible Substitute Mortgage Loan or Loans, which substitution shall be
accomplished in the manner and subject to the conditions set forth in Section
2.03, or (b) purchase such Mortgage Loan from the Trust Administrator within 90
days from the date the Originator was notified of such defect in writing at the
Purchase Price of such Mortgage Loan; provided, however, that in no event shall
such substitution or purchase occur more than 540 days from the Closing Date,
except that if the substitution or purchase of a Mortgage Loan pursuant to this
provision is required by reason of a delay in delivery of any documents by the
appropriate recording office, and there is a dispute between either the Servicer
or the Originator and the Trust Administrator over the location or status of the
recorded document, then such substitution or purchase shall occur within 720
days from the Closing Date. Any such substitution pursuant to (a) above or
purchase pursuant to (b) above shall not be effected prior to the delivery to
the Trust Administrator of a Request for Release substantially in the form of
Exhibit L. No substitution is permitted to be made in any calendar month after
the Determination Date for such month. The Purchase Price for any such Mortgage
Loan shall be paid by the Originator to the Trust Administrator for deposit in
the Collection Account on or prior to the Distribution Account Deposit Date for
the Distribution Date in the month following the month of repurchase and, upon
receipt of such deposit and certification with respect thereto in the form of
Exhibit L hereto, the Trust Administrator shall release the related Mortgage
File to the Originator and shall execute and deliver at the Originator's request
such instruments of transfer or assignment prepared by the Originator, in each
case without recourse, as shall be necessary to vest in the Originator, or a
designee, the Trust Administrator's interest in any Mortgage Loan released
pursuant hereto.
The Trust Administrator shall retain possession and custody of each
Mortgage File in accordance with and subject to the terms and conditions set
forth herein. The Servicer shall promptly deliver to the Trust Administrator,
upon the execution or receipt thereof, the originals of such other documents or
instruments constituting the Mortgage File as come into the possession of the
Servicer from time to time.
It is understood and agreed that the obligation of the Originator to
substitute for or to purchase any Mortgage Loan which does not meet the
requirements of Section 2.01 above shall constitute the sole remedy respecting
such defect available to the Trustee, the Trust Administrator, the Depositor and
any Certificateholder against the Originator; provided, however, that
notwithstanding the foregoing, the Originator shall be obligated to indemnify
the parties set forth in Section 2.03(d) in connection with the matters set
forth in such Section.
Section 2.03. Representations, Warranties and Covenants of the
Originator.
------------------------------------------------
(a) The Originator hereby makes the representations and warranties
set forth in Schedule II hereto, and by this reference incorporated herein, to
the Depositor, the Trust Administrator and the Trustee, as of the Closing Date,
or if so specified therein, as of the Cut-off Date.
(b) The Originator hereby makes the representations and warranties
set forth in Schedule III hereto with respect to the Mortgage Loans, and by this
reference incorporated herein, to the Depositor, the Trust Administrator and the
Trustee, as of September 10, 2001, or if so specified therein, as of the Cut-off
Date.
(c) Upon discovery by any of the parties hereto of a breach of a
representation or warranty made pursuant to Section 2.03(a) or 2.03(b) that
materially and adversely affects the interests of the Certificateholders in any
Mortgage Loan, the party discovering such breach shall give prompt notice
thereof to the other parties. A breach which causes a Mortgage Loan not to
constitute a "qualified mortgage" within the meaning of Section 860G(a)(3) of
the Code, will be deemed automatically to materially and adversely affect the
interests of the Certificateholders in such Mortgage Loan. The Originator hereby
covenants that within 90 days of the earlier of its discovery or its receipt of
written notice from any party of a breach of any representation or warranty made
pursuant to Section 2.03(a) or 2.03(b) which materially and adversely affects
the interests of the Certificateholders in any Mortgage Loan, it shall cure such
breach in all material respects, and if such breach is not so cured, shall, (i)
if such 90 day period expires within 120 days of the Closing Date, remove such
Mortgage Loan (a "Deleted Mortgage Loan") from the Trust Fund and substitute in
its place an Eligible Substitute Mortgage Loan or Loans, in the manner and
subject to the conditions set forth in this Section, provided that any such
substitution shall be effected no later than 120 days after the Closing Date; or
(ii) repurchase the affected Mortgage Loan or Mortgage Loans from the Trustee at
the Purchase Price in the manner set forth below; provided, however, that any
such substitution pursuant to (i) above shall not be effected prior to the
delivery to the Trust Administrator of a Request for Release substantially in
the form of Exhibit L and the Mortgage File for any such Eligible Substitute
Mortgage Loan. The Originator shall promptly reimburse the Servicer, the Trust
Administrator and the Trustee for any expenses reasonably incurred by the
Servicer, the Trust Administrator or the Trustee in respect of enforcing the
remedies for such breach. With respect to the representations and warranties
described in this Section which are made to the best of the Originator's
knowledge, if it is discovered by any of the Depositor, the Originator, the
Trustee or the Trust Administrator that the substance of such representation and
warranty is inaccurate and such inaccuracy materially and adversely affects the
value of the related Mortgage Loan or the interests of the Certificateholders
therein, notwithstanding the Originator's lack of knowledge with respect to the
substance of such representation or warranty, such inaccuracy shall be deemed a
breach of the applicable representation or warranty.
With respect to any Eligible Substitute Mortgage Loan or Loans, the
Originator shall deliver to the Trust Administrator on behalf of the Trustee for
the benefit of the Certificateholders the Mortgage Note, the Mortgage, the
related assignment of the Mortgage, and such other documents and agreements as
are required by Section 2.01, with the Mortgage Note endorsed and the Mortgage
assigned as required by Section 2.01. No substitution is permitted to be made in
any calendar month after the Determination Date for such month. Scheduled
Payments due with respect to Eligible Substitute Mortgage Loans in the month of
substitution shall not be part of the Trust Fund and will be retained by the
Originator on the next succeeding Distribution Date. For the month of
substitution, distributions to Certificateholders will include the monthly
payment due on any Deleted Mortgage Loan for such month and thereafter the
Originator shall be entitled to retain all amounts received in respect of such
Deleted Mortgage Loan. The Servicer shall amend the Mortgage Loan Schedule for
the benefit of the Certificateholders to reflect the removal of such Deleted
Mortgage Loan and the substitution of the Eligible Substitute Mortgage Loan or
Loans and the Servicer shall deliver the amended Mortgage Loan Schedule to the
Trustee and the Trust Administrator. Upon such substitution, the Eligible
Substitute Mortgage Loan or Loans shall be subject to the terms of this
Agreement in all respects, and the Originator shall be deemed to have made with
respect to such Eligible Substitute Mortgage Loan or Loans, as of the date of
substitution, the representations and warranties made pursuant to Section
2.03(b) with respect to such Mortgage Loan. Upon any such substitution and the
deposit to the Collection Account of the amount required to be deposited therein
in connection with such substitution as described in the following paragraph,
the Trust Administrator shall release the Mortgage File held for the benefit of
the Certificateholders relating to such Deleted Mortgage Loan to the Originator
and shall execute and deliver at the Originator's direction such instruments of
transfer or assignment prepared by the Originator, in each case without
recourse, as shall be necessary to vest title in the Originator, or its
designee, the Trustee's interest in any Deleted Mortgage Loan substituted for
pursuant to this Section 2.03.
For any month in which the Originator substitutes one or more
Eligible Substitute Mortgage Loans for one or more Deleted Mortgage Loans, the
Servicer will determine the amount (if any) by which the aggregate principal
balance of all such Eligible Substitute Mortgage Loans as of the date of
substitution is less than the aggregate Scheduled Principal Balance of all such
Deleted Mortgage Loans (after application of the scheduled principal portion of
the monthly payments due in the month of substitution). The amount of such
shortage (the "Substitution Adjustment Amount") plus an amount equal to the
aggregate of any unreimbursed Advances with respect to such Deleted Mortgage
Loans shall be deposited in the Collection Account by the Originator on or
before the Distribution Account Deposit Date for the Distribution Date in the
month succeeding the calendar month during which the related Mortgage Loan
became required to be purchased or replaced hereunder.
In the event that the Originator shall have repurchased a Mortgage
Loan, the Purchase Price therefor shall be deposited in the Collection Account
pursuant to Section 3.05 on or before the Distribution Account Deposit Date for
the Distribution Date in the month following the month during which the
Originator became obligated hereunder to repurchase or replace such Mortgage
Loan and upon such deposit of the Purchase Price and receipt of a Request for
Release in the form of Exhibit L hereto, the Trust Administrator shall release
the related Mortgage File held for the benefit of the Certificateholders to such
Person, and the Trust Administrator shall execute and deliver at such Person's
direction such instruments of transfer or assignment prepared by such Person, in
each case without recourse, as shall be necessary to transfer title from the
Trust Administrator. It is understood and agreed that the obligation under this
Agreement (i) of any Person to cure, repurchase or replace any Mortgage Loan as
to which a breach has occurred and is continuing and (ii) of the Originator to
indemnify the parties set forth in Section 2.03(d) in connection with the
matters set forth in such Section shall constitute the sole remedies against
such Persons respecting such matters available to Certificateholders, the
Depositor, the Trust Administrator or the Trustee on their behalf.
The representations and warranties made pursuant to this Section
2.03 shall survive delivery of the respective Mortgage Files to the Trust
Administrator for the benefit of the Certificateholders.
(d) The Originator shall indemnify and hold harmless the
Depositor, Trustee, Trust Administrator, their directors, officers, agents,
employees, assignees and Control Persons, and the Trust (each, an "Indemnified
Party") from and against any costs, damages, expenses (including reasonable
attorneys' fees and costs, irrespective of whether or not incurred in connection
with the defense of any actual or threatened action, proceeding, or claim),
fines, forfeitures, injuries, liabilities or losses ("Losses") suffered or
sustained in any way by any such Person, no matter how or when arising
(including Losses incurred or sustained in connection with any judgment, award
or settlement), in connection with or relating to (i) a breach by the Originator
of any of its representations and warranties contained in this Section, (ii) a
breach by the Originator of any of its covenants and other obligations contained
herein. The Originator shall immediately (x) notify the Trustee, the Trust
Administrator and the Depositor if a claim is made by a third party with respect
to this Agreement, any Mortgage Loan and/or any REO Property, (y) assume (with
the prior written consent of the Trust Administrator and the Depositor) the
defense of any such claim and pay all expenses in connection therewith,
including attorneys' fees, and (z) promptly pay, discharge and satisfy any
judgment, award, or decree that may be entered against it, the Trust, the
Trustee, the Trust Administrator or the Depositor in respect of such claim.
Nothing contained herein shall prohibit the Trustee, the Trust Administrator or
the Depositor, at its expense, from retaining its own counsel to assist in any
such proceedings or to observe such proceedings; provided that the Originator
shall not be obligated to pay or comply with any settlement to which it has not
consented, such consent not to be unreasonably withheld.
Section 2.04. Representations and Warranties of the Depositor as
to the Mortgage Loans.
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The Depositor hereby represents and warrants to the Trustee with
respect to each Mortgage Loan as of the date hereof or such other date set forth
herein that as of the Closing Date, and following the transfer of the Mortgage
Loans to it by the Loan Seller, the Depositor had good title to the Mortgage
Loans and the Mortgage Notes were subject to no offsets, defenses or
counterclaims.
It is understood and agreed that the representations and warranties
set forth in this Section 2.04 shall survive delivery of the Mortgage Files to
the Trust Administrator. Upon discovery by the Depositor, the Originator, the
Servicer, the Trust Administrator or the Trustee of a breach of any of the
foregoing representations and warranties set forth in this Section 2.04
(referred to herein as a "breach"), which breach materially and adversely
affects the interest of the Certificateholders, the party discovering such
breach shall give prompt written notice to the others and to each Rating Agency.
Section 2.05. [Reserved.]
Section 2.06. Execution and Delivery of Certificates.
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The Trustee acknowledges the transfer and assignment to it of the
Trust Fund and, concurrently with such transfer and assignment, has executed,
authenticated 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 Trust Administrator on behalf of the
Trustee agrees to hold the Trust Fund and exercise the rights referred to above
on behalf of the Trustee for the benefit of all present and future Holders of
the Certificates and to perform the duties set forth in this Agreement to the
best of its ability, to the end that the interests of the Holders of the
Certificates may be adequately and effectively protected.
Section 2.07. REMIC Matters.
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The Preliminary Statement sets forth the designations as "regular
interests" or "residual interests" and "latest possible maturity date" 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 REMIC's
fiscal year shall be the calendar year.
Section 2.08. Covenants of the Servicer.
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The Servicer hereby covenants to the Depositor, the Trust
Administrator and the Trustee as follows:
(a) the Servicer shall comply in the performance of its
obligations under this Agreement with all reasonable rules and requirements of
the insurer under each Required Insurance Policy; and
(b) no written information, certificate of an officer, statement
furnished in writing or written report delivered to the Depositor, any affiliate
of the Depositor, the Trust Administrator or the Trustee and prepared by the
Servicer pursuant to this Agreement will contain any untrue statement of a
material fact or omit to state a material fact necessary to make such
information, certificate, statement or report not misleading.
Section 2.09. Representations and Warranties of the Servicer.
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The Servicer hereby represents and warrants to the Depositor, the
Trust Administrator and the Trustee, as of the Closing Date, or if so specified
herein, as of the Cut-off Date:
(a) The Servicer is duly organized as a corporation and is validly
existing and in good standing under the laws of the State of California and is
duly authorized and qualified to transact any and all business contemplated by
this Agreement to be conducted by the Servicer in any state in which a Mortgaged
Property is located or is otherwise not required under applicable law to effect
such qualification and, in any event, is in compliance with the doing business
laws of any such state, to the extent necessary to ensure its ability to enforce
each Mortgage Loan, to service the Mortgage Loans in accordance with the terms
of this Agreement and to perform any of its other obligations under this
Agreement in accordance with the terms thereof.
(b) The Servicer has the full power and authority to service each
Mortgage Loan, and to execute, deliver and perform, and to enter into and
consummate the transactions contemplated by this Agreement and has duly
authorized by all necessary action on the part of the Servicer 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 the Servicer, enforceable
against the Servicer in accordance with its terms, except that (a) the
enforceability thereof may be limited by bankruptcy, insolvency, moratorium,
receivership and other similar laws relating to creditors' rights generally and
(b) the remedy of specific performance and injunctive and other forms of
equitable relief may be subject to 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 the Servicer,
and the servicing of the Mortgage Loans by the Servicer under this Agreement,
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 the Servicer and will not (A) result in a
material breach of any term or provision of the articles of incorporation or
by-laws of the Servicer or (B) materially conflict with, result in a material
breach, violation or acceleration of, or result in a material default under, the
terms of any other material agreement or instrument to which the Servicer is a
party or by which it may be bound, or (C) constitute a material violation of any
statute, order or regulation applicable to the Servicer of any court, regulatory
body, administrative agency or governmental body having jurisdiction over the
Servicer; and the Servicer is not in breach or violation of any material
indenture or other material agreement or instrument, or in violation of any
statute, order or regulation of any court, regulatory body, administrative
agency or governmental body having jurisdiction over it which breach or
violation may materially impair the Servicer's ability to perform or meet any of
its obligations under this Agreement.
(d) The Servicer is an approved servicer of conventional mortgage
loans for ▇▇▇▇▇▇ ▇▇▇ or ▇▇▇▇▇▇▇ Mac and is a mortgagee approved by the Secretary
of Housing and Urban Development pursuant to sections 203 and 211 of the
National Housing Act.
(e) No litigation is pending or threatened against the Servicer
that would materially and adversely affect the execution, delivery or
enforceability of this Agreement or the ability of the Servicer to service the
Mortgage Loans or to perform any of its other obligations under this Agreement
in accordance with the terms thereof.
(f) No consent, approval, authorization or order of any court or
governmental agency or body is required for the execution, delivery and
performance by the Servicer of, or compliance by the Servicer with, this
Agreement or the consummation of the transactions contemplated thereby, or if
any such consent, approval, authorization or order is required, the Servicer has
obtained the same.
ARTICLE III
ADMINISTRATION AND SERVICING
OF MORTGAGE LOANS
Section 3.01. Servicer to Service Mortgage Loans.
----------------------------------
The Servicer, as an independent contractor, shall service and
administer the Mortgage Loans and shall have full power and authority, acting
alone or through the utilization of a third party servicing provider, to do any
and all things in connection with such servicing and administration which the
Servicer may deem necessary or desirable, consistent with the terms of this
Agreement and with Accepted Servicing Practices.
Consistent with the terms of this Agreement, the Servicer may waive,
modify or vary any term of any Mortgage Loan or consent to the postponement of
strict compliance with any such term or in any manner grant indulgence to any
Mortgagor if in the Servicer's reasonable and prudent determination such waiver,
modification, postponement or indulgence is not materially adverse to the
interests of Certificateholders, provided, however, the Servicer shall not make
any future advances with respect to a Mortgage Loan. The Servicer shall not
permit any modification with respect to any Mortgage Loan that would cause the
Trust Fund to fail to qualify as a REMIC or result in the imposition of any tax
under Section 860F(a) or Section 860G of the Code. In the event of any such
modification which permits the deferral of interest or principal payments on any
Mortgage Loan, the Servicer shall, on the Business Day immediately preceding the
Trust Administrator Account Deposit Date in any month in which any such
principal or interest payment has been deferred, deposit in the Collection
Account from its own funds, the difference between (a) such month's principal
and one month's interest at the Net Mortgage Rate on the unpaid principal
balance of such Mortgage Loan and (b) the amount paid by the Mortgagor. The
Servicer shall be entitled to reimbursement for such Advances to the same extent
as for all other advances made pursuant to this Agreement. Without limiting the
generality of the foregoing, the Servicer shall continue, and is hereby
authorized and empowered, to execute and deliver on behalf of itself and the
Certificateholders, all instruments of satisfaction or cancellation, or of
partial or full release, discharge and all other comparable instruments, with
respect to the Mortgage Loans and with respect to the Mortgaged Properties. If
reasonably required by the Servicer, the Trustee shall furnish the Servicer with
any powers of attorney and other documents necessary or appropriate to enable
the Servicer to carry out its servicing and administrative duties under this
Agreement and the Servicer shall indemnify the Trustee, its officers, directors,
employees, agents and Control Persons for any costs, liabilities or expenses
incurred by any of them in connection with any negligent or willful use or
misuse of such powers of attorney.
In servicing and administering the Mortgage Loans, the Servicer
shall employ procedures (including collection procedures) and exercise the same
care that it customarily employs and exercises in servicing and administering
mortgage loans for its own account, giving due consideration to Accepted
Servicing Practices where such practices do not conflict with the requirements
of this Agreement.
Section 3.02. Subservicing; Enforcement of the Obligations of
Servicers.
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(a) The Servicer may arrange for the subservicing of any Mortgage
Loan by a Subservicer pursuant to a subservicing agreement; provided, however,
that such subservicing arrangement and the terms of the related subservicing
agreement must provide for the servicing of such Mortgage Loans in a manner
consistent with the servicing arrangements contemplated hereunder. The Servicer
shall send to the Trust Administrator a copy of any such subservicing agreement
within 30 days of execution thereof. Unless the context otherwise requires,
references in this Agreement to actions taken or to be taken by the Servicer in
servicing the Mortgage Loans include actions taken or to be taken by a
Subservicer on behalf of the Servicer. Notwithstanding the provisions of any
subservicing agreement, any of the provisions of this Agreement relating to
agreements or arrangements between the Servicer and a Subservicer or reference
to actions taken through a Subservicer or otherwise, the Servicer shall remain
obligated and liable to the Depositor, the Trustee, the Trust Administrator and
the Certificateholders for the servicing and administration of the Mortgage
Loans in accordance with the provisions of this Agreement without diminution of
such obligation or liability by virtue of such subservicing agreements or
arrangements or by virtue of indemnification from the Subservicer and to the
same extent and under the same terms and conditions as if the Servicer alone
were servicing and administering the Mortgage Loans. All actions of each
Subservicer performed pursuant to the related subservicing agreement shall be
performed as an agent of the Servicer with the same force and effect as if
performed directly by the Servicer.
(b) For purposes of this Agreement, the Servicer shall be deemed
to have received any collections, recoveries or payments with respect to the
Mortgage Loans that are received by a Subservicer regardless of whether such
payments are remitted by the Subservicer to the Servicer.
(c) If the Servicer shall for any reason no longer act in such
capacity hereunder (including, without limitation, by reason of a Servicer Event
of Termination), the Trust Administrator, its designee or any successor servicer
appointed pursuant to Section 6.04 hereof may assume all of the rights and,
except to the extent they arose prior to the date of assumption, obligations of
the Servicer under any subservicing agreements. If so requested by the successor
servicer, the predecessor Servicer shall terminate all subservicers at its sole
cost and expense.
Section 3.03. Rights of the Depositor, the Trust Administrator and
the Trustee in Respect of the Servicer.
----------------------------------------------------
The Depositor may, but is not obligated to, enforce the obligations
of the Servicer hereunder and may, but is not obligated to, perform, or cause a
designee to perform, any defaulted obligation of the Servicer hereunder and in
connection with any such defaulted obligation to exercise the related rights of
the Servicer hereunder; provided that the Servicer shall not be relieved of any
of its obligations hereunder by virtue of such performance by the Depositor or
its designee. Neither the Trustee, the Trust Administrator nor the Depositor
shall have any responsibility or liability for any action or failure to act by
the Servicer nor shall the Trustee, the Trust Administrator or the Depositor be
obligated to supervise the performance of the Servicer hereunder or otherwise.
Section 3.04. Trust Administrator to Act as Servicer.
--------------------------------------
In the event that the Servicer shall for any reason no longer be the
Servicer hereunder (including by reason of a Servicer Event of Termination), the
Trust Administrator or its successor shall in accordance with Section 7.02
thereupon assume all of the rights and obligations of the Servicer hereunder
arising thereafter (except that the Trust Administrator shall not be (i) liable
for losses of the Servicer pursuant to Section 3.09 hereof or any acts or
omissions of the predecessor Servicer hereunder), (ii) obligated to make
Advances if it is prohibited from doing so by applicable law, (iii) obligated to
effectuate repurchases or substitutions of Mortgage Loans hereunder including,
but not limited to, repurchases or substitutions of Mortgage Loans pursuant to
Section 2.02 or 2.03 hereof, (iv) responsible for expenses of the Servicer
pursuant to Section 2.03 or (v) deemed to have made any representations and
warranties of the Servicer pursuant to Section 2.09 hereunder). Any such
assumption shall be subject to Section 7.02 hereof. If the Servicer shall for
any reason no longer be the Servicer (including by reason of any Servicer Event
of Termination), the Trust Administrator or its successor may, but shall not be
obligated to, succeed to any rights and obligations of the Servicer under each
subservicing agreement.
The Servicer shall, upon request of the Trust Administrator, but at
the expense of the Servicer, deliver to the assuming party all documents and
records relating to each subservicing agreement or substitute subservicing
agreement and the Mortgage Loans then being serviced thereunder and an
accounting of amounts collected or held by it and otherwise use its best efforts
to effect the orderly and efficient transfer of the substitute subservicing
agreement to the assuming party.
The Trustee, the Trust Administrator or successor servicer shall be
entitled to be reimbursed from the Servicer for all costs associated with the
transfer of servicing from the Servicer, including, without limitation, any
costs or expenses associated with the complete transfer of all servicing data
and the completion, correction or manipulation of such servicing data as may be
required by the Trust Administrator or successor servicer to correct any errors
or insufficiencies in the servicing data or otherwise to enable the Trust
Administrator or successor servicer to service the Mortgage Loans properly and
effectively. If the Servicer does not pay such reimbursement within thirty (30)
days of its receipt of an invoice therefor, such reimbursement shall be an
expense of the Trust and the Trust Administrator or the Trustee shall be
entitled to withdraw such reimbursement from amounts on deposit in the Trust
Administrator Account or Distribution Account, respectively, pursuant to
Sections 3.08(b)(iv) and 3.08(c)(iv); provided that the Servicer shall reimburse
the Trust for any such expense incurred by the Trust.
Section 3.05. Collection of Mortgage Loan Payments; Collection
Account; Trust Administrator Account;
Distribution Account.
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(a) Continuously from the date hereof until the principal and
interest on all Mortgage Loans are paid in full, the Servicer shall proceed
diligently to collect all payments due under each of the Mortgage Loans when the
same shall become due and payable and shall take special care in ascertaining
and estimating Escrow Payments and all other charges that will become due and
payable with respect to the Mortgage Loan and the Mortgaged Property, to the end
that the installments payable by the Mortgagors will be sufficient to pay such
charges as and when they become due and payable.
(b) The Servicer shall establish and maintain a Collection Account
into which the Servicer shall deposit or cause to be deposited within two
Business Days of receipt, except as otherwise specifically provided herein, the
following payments and collections remitted by Subservicers or received by it in
respect of Mortgage Loans subsequent to the Cut-off Date (other than in respect
of principal and interest due on the Mortgage Loans on or before the Cut-off
Date) and the following amounts required to be deposited hereunder:
(i) all payments on account of principal on the Mortgage Loans,
including Principal Prepayments;
(ii) all payments on account of interest on the Mortgage Loans, net
of the related Servicing Fee;
(iii) all Insurance Proceeds and Liquidation Proceeds, other than
proceeds to be applied to the restoration or repair of the Mortgaged
Property or released to the Mortgagor in accordance with the Servicer's
normal servicing procedures;
(iv) any amount required to be deposited by the Servicer pursuant to
Section 3.05(e) in connection with any losses on Permitted Investments;
(v) any amounts required to be deposited by the Servicer pursuant to
Section 3.09(b), 3.09(d), 3.10, and in respect of net monthly rental
income and disposition proceeds from REO Property pursuant to Section 3.11
hereof;
(vi) amounts payable in connection with repurchases of Mortgage
Loans and all Substitution Adjustment Amounts;
(vii) all Advances made by the Servicer pursuant to Section 4.01;
(viii) with respect to each Principal Prepayment an amount (to be
paid by the Servicer out of its funds) which, when added to all amounts
allocable to interest received in connection with the Principal
Prepayment, equals one month's interest on the amount of principal so
prepaid at the Net Mortgage Rate;
(ix) any amounts required to be deposited by the Servicer pursuant
to Section 3.09(b) in connection with the deductible clause in any blanket
hazard insurance policy; and
(x) any other amounts required to be deposited hereunder.
The foregoing requirements for deposit into the Collection Account
shall be exclusive, it being understood and agreed that, without limiting the
generality of the foregoing, payments in the nature of late payment charges and
assumption fees, to the extent permitted by Section 3.10, need not be deposited
by the Servicer into the Collection Account. In the event that the Servicer
shall remit any amount not required to be remitted, it may at any time withdraw
or direct the institution maintaining the Collection Account to withdraw such
amount from the Collection Account, any provision herein to the contrary
notwithstanding. The Servicer shall maintain adequate records with respect to
all withdrawals made pursuant to this Section. All funds deposited in the
Collection Account shall be held in trust for the Certificateholders until
withdrawn in accordance with Section 3.08.
(c) The Trust Administrator shall establish and maintain, on
behalf of the Certificateholders, the Trust Administrator Account. The Trust
Administrator shall, promptly upon receipt, deposit in the Trust Administrator
Account and retain therein the following:
(i) the aggregate amount remitted by the Servicer to the Trust
Administrator pursuant to Section 3.08(a)(ix);
(ii) any amount deposited by the Servicer or the Trust Administrator
pursuant to Section 3.05(e) in connection with any losses on Permitted
Investments; and
(iii) any other amounts deposited hereunder which are required to be
deposited in the Trust Administrator Account.
(d) The Trustee shall establish and maintain, on behalf of the
Certificateholders, the Distribution Account. The Trustee shall, promptly upon
receipt, deposit in the Distribution Account and retain therein the following:
(i) the aggregate amount remitted by the Trust Administrator to the
Trustee pursuant to Section 3.08(b)(i);
(ii) any amount deposited by the Servicer or the Trust Administrator
pursuant to Section 3.05(e) in connection with any losses on Permitted
Investments; and
(iii) any other amounts deposited hereunder which are required to be
deposited in the Distribution Account.
In the event that the Servicer shall remit any amount not required
to be remitted, it may at any time direct the Trust Administrator or Trustee, as
applicable, to withdraw such amount from the Trust Administrator Account or
Distribution Account, as applicable, any provision herein to the contrary
notwithstanding. Such direction may be accomplished by delivering an Officer's
Certificate to the Trustee or the Trust Administrator, as applicable, which
describes the amounts deposited in error in the Trust Administrator Account or
Distribution Account, as applicable. All funds deposited in the Trust
Administrator Account or Distribution Account shall be held by the Trust
Administrator or the Trustee, as applicable, in trust for the Certificateholders
until disbursed in accordance with this Agreement or withdrawn in accordance
with Section 3.08. In no event shall the Trust Administrator or the Trustee, as
applicable, incur liability for withdrawals from the Trust Administrator Account
or Distribution Account at the direction of the Servicer.
(e) Each institution at which the Collection Account, Trust
Administrator Account or Distribution Account is maintained shall invest the
funds on deposit in the Collection Account, Trust Administrator Account or
Distribution Account as directed in writing by the Servicer, in the case of the
Collection Account, by the Trust Administrator, in the case of the Distribution
Account, and by the Trust Administrator in the case of the Trust Administrator
Account, in Permitted Investments. Funds invested in the Collection Account
shall mature not later than the second Business Day next preceding the related
Trust Administrator Account Deposit Date (except that if such Permitted
Investment is an obligation of the institution that maintains such account, then
such Permitted Investment shall mature not later than the Business Day next
preceding such Trust Administrator Account Deposit Date). The Trust
Administrator shall invest funds on deposit in the Trust Administrator Account
in Permitted Investments which shall mature not later than the second Business
Day preceding the Distribution Date (except that if such Permitted Investment is
an obligation of the institution that maintains such fund or account, then such
Permitted Investment shall mature not later than the Business Day next preceding
such Distribution Date). The Trustee shall invest funds on deposit in the
Distribution Account in Permitted Investments which shall mature not later than
the Distribution Date to the extent that such Permitted Investment is an
obligation of the institution that maintains such fund or account. Permitted
Investments in respect of the Collection Account, Trust Administrator Account or
the Distribution Account shall not be sold or disposed of prior to their
maturity. All such Permitted Investments shall be made in the name of the
Trustee, for the benefit of the Certificateholders. All income and gain net of
any losses realized from any such investment of funds on deposit in the
Collection Account shall be for the benefit of the Servicer as servicing
compensation and shall be remitted to it monthly as provided herein. The amount
of any realized losses in the Collection Account incurred in any such account in
respect of any such investments shall promptly be deposited by the Servicer in
the Collection Account or paid to the Trust Administrator or Trustee, as
applicable, by wire transfer of immediately available funds for deposit into the
Trust Administrator Account or the Distribution Account, as applicable. All
income and gain net of any losses realized from any such investment of funds on
deposit in the Trust Administrator Account and the Distribution Account shall be
for the benefit of the Trust Administrator as additional compensation and shall
be remitted to it monthly as provided herein. The amount of any realized losses
in the Trust Administrator Account and the Distribution Account incurred in any
such account in respect of any such investments shall promptly be deposited by
the Trust Administrator in the Trust Administrator Account or the Distribution
Account, as applicable. In the absence of written instructions by the Servicer
to invest funds held in the Collection Account, all funds on deposit thereon
shall remain uninvested.
(f) The Servicer shall give notice to the Trust Administrator (and
the Trust Administrator shall deliver such notice to the Trustee and each Rating
Agency) of any proposed change of the location of the Collection Account prior
to any change thereof. The Trust Administrator shall give notice to the
Servicer, the Trustee, each Rating Agency and the Depositor of any proposed
change of the location of the Trust Administrator Account prior to any change
thereof. The Trustee shall give notice to the Servicer, the Trust Administrator,
each Rating Agency and the Depositor of any proposed change of the location of
the Distribution Account prior to any change thereof.
Section 3.06. Collection of Taxes, Assessments and Similar
Items; Escrow Accounts.
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(a) With respect to each Mortgage Loan, the Servicer shall
maintain accurate records reflecting the status of ground rents, taxes,
assessments, water rates, sewer rents, and other charges which are or may become
a lien upon the Mortgaged Property and the status of Primary Insurance Policy
premiums and fire and hazard insurance coverage and shall obtain, from time to
time, all bills for the payment of such charges (including renewal premiums) and
shall effect payment thereof prior to the applicable penalty or termination
date, employing for such purpose deposits of the Mortgagor in the Escrow Account
which shall have been estimated and accumulated by the Servicer in amounts
sufficient for such purposes, as allowed under the terms of the Mortgage. The
Servicer assumes full responsibility for the timely payment of all such bills
and shall effect timely payment of all such charges irrespective of each
Mortgagor's faithful performance in the payment of same of the making of the
Escrow Payments, and the Servicer shall make advances from its own funds to
effect such payments.
(b) The Servicer shall segregate and hold all funds collected and
received pursuant to a Mortgage Loan constituting Escrow Payments separate and
apart from any of its own funds and general assets and shall establish and
maintain one or more Escrow Accounts, in the form of time deposit or demand
accounts. The Escrow Accounts shall be an Eligible Account, in a manner which
shall provide maximum available insurance thereunder. Funds deposited in the
Escrow Account may be drawn on by the Servicer in accordance with Section
3.06(c).
The Servicer shall deposit in the Escrow Account or Accounts within
two (2) Business Days of Servicer's receipt , and retain therein:
(i) all Escrow Payments collected on account of the Mortgage Loans,
for the purpose of effecting timely payment of any such items as required
under the terms of this Agreement; and
(ii) all amounts representing Insurance Proceeds or Liquidation
Proceeds which are to be applied to the restoration or repair of any
Mortgaged Property.
The Servicer shall make withdrawals from the Escrow Account only to
effect such payments as are required under this Agreement, as set forth in
Section 3.06(c). The Servicer shall be entitled to retain any interest paid on
funds deposited in the Escrow Account by the depository institution, other than
interest on escrowed funds required by law to be paid to the Mortgagor. To the
extent required by law, the Servicer shall pay interest on escrowed funds to the
Mortgagor notwithstanding that the Escrow Account may be non-interest bearing or
that interest paid thereon is insufficient for such purposes.
(c) Withdrawals from the Escrow Account or Accounts may be made by
the Servicer only:
(i) to effect timely payments of ground rents, taxes, assessments,
water rates, mortgage insurance premiums, condominium charges, fire and
hazard insurance premiums or other items constituting Escrow Payments for
the related Mortgage Loan;
(ii) to reimburse the Servicer for any Servicing Advances made by
the Servicer pursuant to Section 3.06(a) with respect to a related
Mortgage Loan, but only from amounts received on the related Mortgage Loan
which represent late collections of Escrow Payments thereunder;
(iii) to refund to any Mortgagor any funds found to be in excess of
the amounts required under the terms of the related Mortgage Loan;
(iv) for transfer to the Collection Account and application to
reduce the principal balance of the Mortgage Loan in accordance with the
terms of the related Mortgage and Mortgage Note;
(v) for application to the restoration or repair of the Mortgaged
Property in accordance with the procedures outlined in Section 3.19;
(vi) to pay to the Servicer, or any Mortgagor to the extent required
by law, any interest paid on the funds deposited in the Escrow Account;
(vii) to remove funds inadvertently placed in the Escrow Account by
the Servicer; and
(viii) to clear and terminate the Escrow Account on the termination
of this Agreement.
Section 3.07. Access to Certain Documentation and Information
Regarding the Mortgage Loans.
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The Depositor, the Trust Administrator, or the Trustee, or any
designee, shall have the right to examine and audit any and all of the books,
records, or other information of the Servicer, whether held by the Servicer or
by another on its behalf, with respect to or concerning this Agreement or the
Mortgage Loans, during business hours or at such other times as may be
reasonable under applicable circumstances, upon reasonable advance notice. The
Depositor, the Trust Administrator or any designee shall pay its own travel
expenses associated with such examination. The Trust Administrator shall
reimburse the Trustee for any travel expenses incurred by the Trustee associated
with such examination.
Upon reasonable advance notice in writing, the Servicer will provide
to the Trust Administrator, if requested of the Trust Administrator by a
Certificateholder which is a savings and loan association, bank or insurance
company certain reports and reasonable access to information and documentation
regarding the Mortgage Loans sufficient to permit such Certificateholder to
comply with applicable regulations of the OTS or other regulatory authorities
with respect to investment in the Certificates and the Trust Administrator shall
deliver such information to such Certificateholder; provided that the Servicer
shall be entitled to be reimbursed by each such Certificateholder for actual
expenses incurred by the Servicer in providing such reports and access.
Section 3.08. Permitted Withdrawals from the Collection Account,
Trust Administrator Account and Distribution Account.
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(a) The Servicer may from time to time make withdrawals from the
Collection Account for the following purposes:
(i) to pay to the Servicer (to the extent not previously retained by
the Servicer) the servicing compensation to which it is entitled pursuant
to Section 3.14, and to pay to the Servicer, as additional servicing
compensation, earnings on or investment income with respect to funds in or
credited to the Collection Account;
(ii) to reimburse the Servicer for unreimbursed Advances made by it,
such right of reimbursement pursuant to this subclause (ii) being limited
to amounts received on the Mortgage Loan(s) which represent late payments
of principal and/or interest respecting which any such advance was made,
it being understood that, in the case of any such reimbursement, the
Servicer's right thereto shall be prior to the rights of Trust
Administrator, except that, where the Servicer is required to repurchase a
Mortgage Loan pursuant to this Agreement, the Servicer's right to such
reimbursement shall be subsequent to the payment to the Trust
Administrator of the Purchase Price pursuant to such sections and all
other amounts required to be paid to the Trust Administrator with respect
to such Mortgage Loan;
(iii) to pay any amount required to be paid pursuant to Section 3.10
related to any REO Property, it being understood that, in the case of any
such expenditure or withdrawal related to a particular REO Property, the
amount of such expenditure or withdrawal from the Collection Account shall
be limited to amounts on deposit in the Collection Account with respect to
the related REO Property;
(iv) to reimburse the Servicer for any Servicing Advances or REO
Property expenses after liquidation of the Mortgaged Property not
otherwise reimbursed above;
(v) to reimburse the Servicer for unreimbursed Servicing Advances,
the Servicer's right to reimbursement pursuant to this clause (v) with
respect to any Mortgage Loan being limited to amounts received on such
Mortgage Loan(s) which represent Liquidation Proceeds, Insurance Proceeds
and such other amounts as may be collected by the Servicer from the
Mortgagor or otherwise relating to the Mortgage Loan, it being understood
that, in the case of any such reimbursement, the Servicer's right thereto
shall be prior to the rights of Trust Administrator, except that where the
Originator is required to repurchase a Mortgage Loan pursuant to Section
2.03 of this Agreement, in which case the Servicer's right to such
reimbursement shall be subsequent to the payment to the Trust
Administrator of the Purchase Price pursuant to such sections and all
other amounts required to be paid to the Trust Administrator with respect
to such Mortgage Loan;
(vi) to pay to the purchaser, with respect to each Mortgage Loan or
property acquired in respect thereof that has been purchased pursuant to
Section 2.02 or 2.03, all amounts received thereon after the date of such
purchase;
(vii) to reimburse the Originator, the Servicer or the Depositor for
expenses incurred by any of them and reimbursable pursuant to Section 6.03
hereof;
(viii) to withdraw any amount deposited in the Collection Account
and not required to be deposited therein;
(ix) on or prior to the Trust Administrator Account Deposit Date, to
withdraw an amount equal to the related Available Funds for such
Distribution Date and remit by wire transfer of immediately available
funds such amount to the Trust Administrator for deposit in the Trust
Administrator Account; and
(x) to clear and terminate the Collection Account upon termination
of this Agreement pursuant to Section 9.01 hereof.
The Servicer shall keep and maintain separate accounting, on a
Mortgage Loan by Mortgage Loan basis, for the purpose of justifying any
withdrawal from the Collection Account pursuant to such subclauses (i), (ii),
(v) and (vi).
(b) The Trust Administrator may from time to time make withdrawals
from the Trust Administrator Account for the following purposes:
(i) on or prior to the Distribution Account Deposit Date, to
withdraw an amount equal to the related Available Funds for such
Distribution Date and remit by wire transfer of immediately available
funds such amount to the Trustee for deposit in the Distribution Account;
(ii) to pay to itself earnings on or investment income with respect
to funds in or credited to the Trust Administrator Account;
(iii) to withdraw and return to the Servicer any amount deposited in
the Trust Administrator Account and not required to be deposited therein;
(iv) to withdraw any indemnity, expense or other reimbursement owed
to it pursuant to this Agreement, including without limitation, Section
3.04, Section 7.02 and Section 8.05; and
(v) to clear and terminate the Trust Administrator Account upon
termination of the Agreement pursuant to Section 9.01 hereof.
(c) The Trustee shall withdraw funds from the Distribution Account
for distributions to Certificateholders, in the manner specified in this
Agreement (and to withhold from the amounts so withdrawn, the amount of any
taxes that it is authorized to withhold pursuant to the last paragraph of
Section 8.11). In addition, the Trustee may from time to time make withdrawals
from the Distribution Account for the following purposes:
(i) to make distributions pursuant to Section 4.02;
(ii) to pay to the Trust Administrator earnings on or investment
income with respect to funds in or credited to the Distribution Account;
(iii) to withdraw and return to the Servicer any amount deposited in
the Distribution Account and not required to be deposited therein;
(iv) to withdraw any indemnity, expense or other reimbursement owed
to it pursuant to this Agreement, including without limitation, Section
3.04, Section 7.02 and Section 8.05; and
(v) to clear and terminate the Distribution Account upon termination
of the Agreement pursuant to Section 9.01 hereof.
Section 3.09. Maintenance of Hazard Insurance; Maintenance of
Primary Insurance Policies.
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(a) The Servicer shall cause to be maintained for each Mortgage
Loan hazard insurance such that all buildings upon the Mortgaged Property are
insured by an insurer acceptable to ▇▇▇▇▇▇ ▇▇▇ or ▇▇▇▇▇▇▇ Mac against loss by
fire, hazards of extended coverage and such other hazards as are customary in
the area where the Mortgaged Property is located, in an amount which is at least
equal to the lesser of (i) the maximum insurable value of the improvements
securing such Mortgage Loan and (ii) the greater of (a) the outstanding
principal balance of the Mortgage Loan and (b) an amount such that the proceeds
thereof shall be sufficient to prevent the Mortgagor or the loss payee from
becoming a co-insurer. In the event a hazard insurance policy shall be in danger
of being terminated, or in the event the insurer shall cease to be acceptable to
▇▇▇▇▇▇ Mae or ▇▇▇▇▇▇▇ Mac, the Servicer shall notify the related Mortgagor, and
shall use its best efforts, as permitted by applicable law, to obtain from
another qualified insurer a replacement hazard insurance policy substantially
and materially similar in all respects to the original policy. In no event,
however, shall a Mortgage Loan be without a hazard insurance policy at any time,
subject only to Section 3.09(b) hereof.
If the related Mortgaged Property is located in an area identified
by the Flood Emergency Management Agency as having special flood hazards (and
such flood insurance has been made available) a flood insurance policy meeting
the requirements of the current guidelines of the Federal Insurance
Administration is in effect with a generally acceptable insurance carrier
acceptable to ▇▇▇▇▇▇ Mae or ▇▇▇▇▇▇▇ Mac in an amount representing coverage equal
to the lesser of (i) the minimum amount required, under the terms of coverage,
to compensate for any damage or loss on a replacement cost basis (or the unpaid
balance of the mortgage if replacement cost coverage is not available for the
type of building insured) and (ii) the maximum amount of insurance which is
available under the Flood Disaster Protection Act of 1973, as amended.
If a Mortgage is secured by a unit in a condominium project, the
Servicer shall verify that the coverage required of the owner's association,
including hazard, flood, liability, and fidelity coverage, is being maintained
in accordance with then current ▇▇▇▇▇▇ Mae requirements, and secure from the
owner's association its agreement to notify the Servicer promptly of any change
in the insurance coverage or of any condemnation or casualty loss that may have
a material effect on the value of the Mortgaged Property as security.
In the event that the Servicer shall determine that the Mortgaged
Property should be insured against loss or damage by hazards and risks not
covered by the insurance required to be maintained by the Mortgagor pursuant to
the terms of the Mortgage, the Servicer shall communicate and consult with the
Mortgagor with respect to the need for such insurance and bring to the
Mortgagor's attention the desirability of protection of the Mortgaged Property.
All policies required hereunder shall name the Servicer as loss
payee and shall be endorsed with standard or union mortgagee clauses, without
contribution, which shall provide for at least 30 days prior written notice of
any cancellation, reduction in amount or material change in coverage.
The Servicer shall not interfere with the Mortgagor's freedom of
choice in selecting either his insurance carrier or agent, provided, however,
that the Servicer shall not accept any such insurance policies from insurance
companies unless such companies are acceptable to ▇▇▇▇▇▇ ▇▇▇ and ▇▇▇▇▇▇▇ Mac and
are licensed to do business in the jurisdiction in which the Mortgaged Property
is located. The Servicer shall determine that such policies provide sufficient
risk coverage and amounts, that they insure the property owner, and that they
properly describe the property address.
Pursuant to Section 3.05, any amounts collected by the Servicer
under any such policies (other than amounts to be deposited in the Escrow
Account and applied to the restoration or repair of the related Mortgaged
Property, or property acquired in liquidation of the Mortgage Loan, or to be
released to the Mortgagor, in accordance with the Servicer's normal servicing
procedures as specified in Section 3.19) shall be deposited in the Collection
Account subject to withdrawal pursuant to Section 3.08.
(b) In the event that the Servicer shall obtain and maintain a
blanket policy insuring against losses arising from fire and hazards covered
under extended coverage on all of the Mortgage Loans, then, to the extent such
policy provides coverage in an amount equal to the amount required pursuant to
Section 3.09(a) and otherwise complies with all other requirements of Section
3.09(a), it shall conclusively be deemed to have satisfied its obligations as
set forth in Section 3.09(a). The Servicer shall prepare and make any claims on
the blanket policy as deemed necessary by the Servicer in accordance with
Accepted Servicing Practices. Any amounts collected by the Servicer under any
such policy relating to a Mortgage Loan shall be deposited in the Collection
Account subject to withdrawal pursuant to Section 3.08. Such policy may contain
a deductible clause, in which case, in the event that there shall not have been
maintained on the related Mortgaged Property a policy complying with Section
3.09(a), and there shall have been a loss which would have been covered by such
policy, the Servicer shall deposit in the Collection Account at the time of such
loss the amount not otherwise payable under the blanket policy because of such
deductible clause, such amount to be deposited from the Servicer's funds,
without reimbursement therefor.
(c) With respect to each Mortgage Loan with a Loan-To-Value Ratio
in excess of 80%, the Servicer shall, without any cost to the Trust Fund
maintain or cause the Mortgagor to maintain in full force and effect a Primary
Insurance Policy insuring the portion over 78% until terminated pursuant to the
Homeowners Protection Act of 1998, 12 UCS ss.4901, et seq. IN the event that
such Primary Insurance Policy shall be terminated other than as required by law,
the Servicer shall obtain from another Qualified Insurer a comparable
replacement policy, with a total coverage equal to the remaining coverage of
such terminated Primary Insurance Policy. If the insurer shall cease to be a
Qualified Insurer, the Servicer shall determine whether recoveries under the
Primary Insurance Policy are jeopardized for reasons related to the financial
condition of such insurer, it being understood that the Servicer shall in no
event have any responsibility or liability for any failure to recover under the
Primary Insurance Policy for such reason. If the Servicer determines that
recoveries are so jeopardized, it shall notify the Mortgagor, if required, and
obtain from another Qualified Insurer a replacement insurance policy. The
Servicer shall not take any action which would result in noncoverage under any
applicable Primary Insurance Policy of any loss which, but for the actions of
the Servicer would have been covered thereunder. In connection with any
assumption or substitution agreement entered into or to be entered into pursuant
to Section 3.10, the Servicer shall promptly notify the insurer under the
related Primary Insurance Policy, if any, of such assumption or substitution of
liability in accordance with the terms of such Primary Insurance Policy and
shall take all actions which may be required by such insurer as a condition to
the continuation of coverage under such Primary Insurance Policy. If such
Primary Insurance Policy is terminated as a result of such assumption or
substitution of liability, the Servicer shall obtain a replacement Primary
Insurance Policy as provided above.
In connection with its activities as servicer, the Servicer agrees
to prepare and present, on behalf of itself and the Certificateholders, claims
to the insurer under any Primary Insurance Policy in a timely fashion in
accordance with the terms of such Primary Insurance Policy and, in this regard,
to take such action as shall be necessary to permit recovery under any Primary
Insurance Policy respecting a defaulted Mortgage Loan. Pursuant to Section 3.05,
any amounts collected by the Servicer under any Primary Insurance Policy shall
be deposited in the Collection Account, subject to withdrawal pursuant to
Section 3.08.
Section 3.10. Enforcement of Due-on-Sale Clauses; Assumption
Agreements.
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The Servicer shall use its best efforts to enforce any "due-on-sale"
provision contained in any Mortgage or Mortgage Note and to deny assumption by
the person to whom the Mortgaged Property has been or is about to be sold
whether by absolute conveyance or by contract of sale, and whether or not the
Mortgagor remains liable on the Mortgage and the Mortgage Note. When the
Mortgaged Property has been conveyed by the Mortgagor, the Servicer shall, to
the extent it has knowledge of such conveyance, exercise its rights to
accelerate the maturity of such Mortgage Loan under the "due-on-sale" clause
applicable thereto, provided, however, that the Servicer shall not exercise such
rights if prohibited by law from doing so or if the exercise of such rights
would impair or threaten to impair any recovery under the related Primary
Insurance Policy, if any.
If the Servicer reasonably believes it is unable under applicable
law to enforce such "due-on-sale" clause, the Servicer shall enter into (i) an
assumption and modification agreement with the person to whom such property has
been conveyed, pursuant to which such person becomes liable under the Mortgage
Note and the original Mortgagor remains liable thereon or (ii) in the event the
Servicer is unable under applicable law to require that the original Mortgagor
remain liable under the Mortgage Note and the Servicer has the prior consent of
the primary mortgage guaranty insurer, a substitution of liability agreement
with the purchaser of the Mortgaged Property pursuant to which the original
Mortgagor is released from liability and the purchaser of the Mortgaged Property
is substituted as Mortgagor and becomes liable under the Mortgage Note. If an
assumption fee is collected by the Servicer for entering into an assumption
agreement the fee will be retained by the Servicer as additional servicing
compensation. In connection with any such assumption, neither the Mortgage Rate
borne by the related Mortgage Note, the term of the Mortgage Loan, the
outstanding principal amount of the Mortgage Loan nor any other material terms
shall be changed without the Trust Administrator's consent.
To the extent that any Mortgage Loan is assumable, the Servicer
shall inquire diligently into the credit worthiness of the proposed transferee,
and shall use the underwriting criteria for approving the credit of the proposed
transferee which were used with respect to underwriting such Mortgage Loan. If
the credit worthiness of the proposed transferee does not meet such underwriting
criteria, the Servicer diligently shall, to the extent permitted by the Mortgage
or the Mortgage Note and by applicable law, accelerate the maturity of the
Mortgage Loan.
Section 3.11. Realization upon Defaulted Mortgage Loans.
-----------------------------------------
In the event that any payment due under any Mortgage Loan and not
postponed pursuant to Section 3.01 is not paid when the same becomes due and
payable, or in the event the Mortgagor fails to perform any other covenant or
obligation under the Mortgage Loan and such failure continues beyond any
applicable grace period, the Servicer shall take such action as (1) the Servicer
would take under similar circumstances with respect to a similar mortgage loan
held for its own account for investment, (2) shall be consistent with Accepted
Servicing Practices, (3) the Servicer shall determine prudently to be in the
best interest of the Certificateholders, and (4) is consistent with any related
Primary Insurance Policy. In the event that any payment due under any Mortgage
Loan is not postponed pursuant to Section 3.01 and remains delinquent for a
period of 90 days or any other default continues for a period of 90 days beyond
the expiration of any grace or cure period, the Servicer shall use reasonable
efforts to foreclose upon or otherwise comparably convert the ownership of
properties securing such of the Mortgage Loans as come into and continue in such
default and as to which no satisfactory arrangements can be made for collection
of delinquent payments. However, the Servicer shall not be required to expend
its own funds in connection with any foreclosure or towards the restoration of
any property unless it shall determine (i) that such restoration and/or
foreclosure will increase the proceeds of liquidation of the Mortgage Loan after
reimbursement to itself of such expenses and (ii) that such expenses will be
recoverable to it through Liquidation Proceeds (respecting which it shall have
priority for purposes of withdrawals from the Collection Account) or through
Insurance Proceeds (respecting which it shall have similar priority). The
Servicer shall be responsible for all other costs and expenses incurred by it in
any such proceedings; provided, however, that it shall be entitled to
reimbursement thereof from the liquidation proceeds with respect to the related
Mortgaged Property, as provided in the definition of Liquidation Proceeds. If
the Servicer has knowledge that a Mortgaged Property which the Servicer is
contemplating acquiring in foreclosure or by deed in lieu of foreclosure is
located within a 1 mile radius of any site listed in the Expenditure Plan for
the Hazardous Substance Clean Up Bond Act of 1984 or other site with
environmental or hazardous waste risks known to the Servicer, the Servicer will,
prior to acquiring the Mortgaged Property, consider such risks and only take
action in accordance with its established environmental review procedures.
With respect to any REO Property, the deed or certificate of sale
shall be taken in the name of the Trustee for the benefit of the
Certificateholders, or its nominee, on behalf of the Certificateholders. The
Trustee's name or that of its nominee shall be placed on the title to such REO
Property solely as the Trustee hereunder or as nominee of the Trustee and not in
its individual capacity. The Servicer shall ensure that the title to such REO
Property references the Pooling and Servicing Agreement and the Trustee's or
such nominee's capacity thereunder. Pursuant to its efforts to sell such REO
Property, the Servicer shall either itself or through an agent selected by the
Servicer manage, conserve, protect and operate the REO Property in the same
manner that it manages, conserves, protects and operates other foreclosed
property for its own account, and in the same manner that similar property in
the same locality as the REO Property is managed. The Servicer shall attempt to
sell the same (and may temporarily rent the same for a period not greater than
one year, except as otherwise provided below) on such terms and conditions as
the Servicer deems to be in the best interest of the Certificateholders. The
Servicer shall prepare for and deliver to the Trust Administrator a statement
with respect to each REO Property that has been rented showing the aggregate
rental income received and all expenses incurred in connection with the
management and maintenance of such REO Property at such times as is necessary to
enable the Trust Administrator to comply with the reporting requirements of the
REMIC Provisions. The net monthly rental income, if any, from such REO Property
shall be deposited in the Collection Account no later than the close of business
on each Determination Date. The Servicer shall perform the tax reporting and
withholding required by Sections 1445 and 6050J of the Code with respect to
foreclosures and abandonments, the tax reporting required by Section 6050H of
the Code with respect to the receipt of mortgage interest from individuals and
any tax reporting required by Section 6050P of the Code with respect to the
cancellation of indebtedness by certain financial entities, by preparing such
tax and information returns as may be required, in the form required, and filing
the same.
The Servicer shall also maintain on each REO Property fire and
hazard insurance with extended coverage in amount which is at least equal to the
maximum insurable value of the improvements which are a part of such property,
liability insurance and, to the extent required and available under the Flood
Disaster Protection Act of 1973, as amended, flood insurance in the amount
required above.
In the event that the Trust Fund acquires any Mortgaged Property as
aforesaid or otherwise in connection with a default or imminent default on a
Mortgage Loan, the Servicer shall dispose of such Mortgaged Property prior to
the close of the third calendar year after the year in which the Trust Fund
acquires such Mortgaged Property unless the Servicer shall have applied for and
received an extension of such period from the Internal Revenue Service, in which
case the Trust Fund may continue to hold such Mortgaged Property for the period
of such extension. Notwithstanding any other provision of this Agreement, no
Mortgaged Property acquired by the Trust Fund shall be rented (or allowed to
continue to be rented) or otherwise used for the production of income by or on
behalf of the Trust Fund in such a manner or pursuant to any terms that would
(i) cause such Mortgaged Property to fail to qualify as "foreclosure property"
within the meaning of section 860G(a)(8) of the Code or (ii) subject any REMIC
hereunder to the imposition of any federal, state or local income taxes on the
income earned from such Mortgaged Property under Section 860G(c) of the Code or
otherwise, unless the Servicer has agreed to indemnify and hold harmless the
Trust Fund with respect to the imposition of any such taxes.
In the event of a default on a Mortgage Loan one or more of whose
obligor is not a United States Person, as that term is defined in Section
7701(a)(30) of the Code, in connection with any foreclosure or acquisition of a
deed in lieu of foreclosure (together, "foreclosure") in respect of such
Mortgage Loan, the Servicer will cause compliance with the provisions of
Treasury Regulation Section 1.1445-2(d)(3) (or any successor thereto) necessary
to assure that no withholding tax obligation arises with respect to the proceeds
of such foreclosure except to the extent, if any, that proceeds of such
foreclosure are required to be remitted to the obligors on such Mortgage Loan.
The decision of the Servicer to foreclose on a defaulted Mortgage
Loan shall be subject to a determination by the Servicer that the proceeds of
such foreclosure would exceed the costs and expenses of bringing such a
proceeding. The income earned from the management of any REO Properties, net of
reimbursement to the Servicer for expenses incurred (including any property or
other taxes) in connection with such management and net of unreimbursed
Servicing Fees, Advances and Servicing Advances, shall be applied to the payment
of principal of and interest on the related defaulted Mortgage Loans (with
interest accruing as though such Mortgage Loans were still current) and all such
income shall be deemed, for all purposes in this Agreement, to be payments on
account of principal and interest on the related Mortgage Notes and shall be
deposited into the Collection Account. To the extent the net income received
during any calendar month is in excess of the amount attributable to amortizing
principal and accrued interest at the related Mortgage Rate on the related
Mortgage Loan for such calendar month, such excess shall be considered to be a
partial prepayment of principal of the related Mortgage Loan.
The Servicer shall withdraw from the Collection Account funds
necessary for the proper operation management and maintenance of the REO
Property, including the cost of maintaining any hazard insurance pursuant to
Section 3.09(a) and the fees of any managing agent of the Servicer, or the
Servicer itself. The REO management fee shall be the greater of one percent (1%)
of the gross sales price of the REO Property or $1500.00 per REO Property. The
Servicer shall make monthly remittances on each Trust Administrator Account
Deposit Date to the Trust Administrator of the net cash flow from the REO
Property (which shall equal the revenues from such REO Property net of the
expenses described in this Section 3.11 and of any reserves reasonably required
from time to time to be maintained to satisfy anticipated liabilities for such
expenses).
The proceeds from any liquidation of a Mortgage Loan, as well as any
income from an REO Property, will be applied in the following order of priority:
first, to reimburse the Servicer for any related unreimbursed Servicing Advances
and Servicing Fees; second, to reimburse the Servicer for any unreimbursed
Advances; third, to reimburse the Collection Account for any Nonrecoverable
Advances (or portions thereof) that were previously withdrawn by the Servicer
from the Collection Account that related to such Mortgage Loan; fourth, to
accrued and unpaid interest (to the extent no Advance has been made for such
amount or any such Advance has been reimbursed) on the Mortgage Loan or related
REO Property, at the Net Mortgage Rate to the Due Date occurring in the month in
which such amounts are required to be distributed; and fifth, as a recovery of
principal of the Mortgage Loan. Excess Proceeds, if any, from the liquidation of
a Liquidated Loan will be distributed to the holders of the Class A-R
Certificates.
Section 3.12. Trust Administrator to Cooperate; Release of
Mortgage Files.
---------------------------------------------
Upon the payment in full of any Mortgage Loan, or the receipt by the
Servicer of a notification that payment in full will be escrowed in a manner
customary for such purposes, the Servicer will immediately notify the Trust
Administrator by delivering, or causing to be delivered a "Request for Release"
substantially in the form of Exhibit L. Upon receipt of such request, the Trust
Administrator shall promptly release the related Mortgage File to the Servicer,
and the Trust Administrator shall at the Servicer's direction execute and
deliver to the Servicer the request for reconveyance, deed of reconveyance or
release or satisfaction of mortgage or such instrument releasing the lien of the
Mortgage in each case provided by the Servicer, together with the Mortgage Note
with written evidence of cancellation thereon. Expenses incurred in connection
with any instrument of satisfaction or deed of reconveyance shall be chargeable
to the related Mortgagor. From time to time and as shall be appropriate for the
servicing or foreclosure of any Mortgage Loan, including for such purpose,
collection under any policy of flood insurance, any fidelity bond or errors or
omissions policy, or for the purposes of effecting a partial release of any
Mortgaged Property from the lien of the Mortgage or the making of any
corrections to the Mortgage Note or the Mortgage or any of the other documents
included in the Mortgage File, the Trust Administrator shall, upon delivery to
the Trust Administrator of a Request for Release in the form of Exhibit L, in
duplicate and signed by a Servicing Officer, or in a mutually agreeable
electronic format which will, in lieu of a signature on its face, originate from
a Servicing Officer, release the Mortgage File to the Servicer. Subject to the
further limitations set forth below, the Servicer shall cause the Mortgage File
or documents so released to be returned to the Trust Administrator when the need
therefor by the Servicer no longer exists, unless the Mortgage Loan is
liquidated and the proceeds thereof are deposited in the Collection Account, in
which case the Servicer shall deliver to the Trust Administrator a Request for
Release in the form of Exhibit L, signed by a Servicing Officer.
If the Servicer at any time seeks to initiate a foreclosure
proceeding in respect of any Mortgaged Property as authorized by this Agreement,
the Servicer shall deliver or cause to be delivered to the Trustee, for
signature, as appropriate, any court pleadings, requests for trustee's sale or
other documents necessary to effectuate such foreclosure or any legal action
brought to obtain judgment against the Mortgagor on the Mortgage Note or the
Mortgage or to obtain a deficiency judgment or to enforce any other remedies or
rights provided by the Mortgage Note or the Mortgage or otherwise available at
law or in equity.
Section 3.13. Documents Records and Funds in Possession of
Servicer to Be Held for the Trust Administrator.
-----------------------------------------------
Notwithstanding any other provisions of this Agreement, the Servicer
shall transmit to the Trust Administrator as required by this Agreement all
documents and instruments in respect of a Mortgage Loan coming into the
possession of the Servicer from time to time and shall account fully to the
Trustee and the Trust Administrator for any funds received by the Servicer or
which otherwise are collected by the Servicer as Liquidation Proceeds or
Insurance Proceeds in respect of any Mortgage Loan. All Mortgage Files and funds
collected or held by, or under the control of, the Servicer in respect of any
Mortgage Loans, whether from the collection of principal and interest payments
or from Liquidation Proceeds, including but not limited to, any funds on deposit
in the Collection Account, shall be held by the Servicer for and on behalf of
the Trustee and shall be and remain the sole and exclusive property of the
Trustee, subject to the applicable provisions of this Agreement. The Servicer
also agrees that it shall not create, incur or subject any Mortgage File or any
funds that are deposited in the Collection Account, Trust Administrator Account,
Distribution Account or any Escrow Account, or any funds that otherwise are or
may become due or payable to the Trustee or the Trust Administrator for the
benefit of the Certificateholders, to any claim, lien, security interest,
judgment, levy, writ of attachment or other encumbrance, or assert by legal
action or otherwise any claim or right of setoff against any Mortgage File or
any funds collected on, or in connection with, a Mortgage Loan, except, however,
that the Servicer shall be entitled to set off against and deduct from any such
funds any amounts that are properly due and payable to the Servicer under this
Agreement.
Section 3.14. Servicing Compensation.
----------------------
As compensation for its activities hereunder, the Servicer shall be
entitled to retain or withdraw from the Collection Account an amount equal to
the Servicing Fee for each Mortgage Loan.
Additional servicing compensation in the form of assumption fees, to
the extent provided in Section 3.10, and late payment charges shall be retained
by the Servicer to the extent not required to be deposited in the Collection
Account. The Servicer shall be required to pay all expenses incurred by it in
connection with its servicing activities hereunder and shall not be entitled to
reimbursement thereof except as specifically provided for herein.
Section 3.15. Access to Certain Documentation.
-------------------------------
The Servicer shall provide to the OTS and the FDIC and to comparable
regulatory authorities supervising Holders of Junior Certificates and the
examiners and supervisory agents of the OTS, the FDIC and such other
authorities, access to the documentation regarding the Mortgage Loans required
by applicable regulations of the OTS and the FDIC. Such access shall be afforded
without charge, but only upon reasonable and prior written request and during
normal business hours at the offices designated by the Servicer. Nothing in this
Section shall limit the obligation of the Servicer to observe any applicable law
prohibiting disclosure of information regarding the Mortgagors and the failure
of the Servicer to provide access as provided in this Section as a result of
such obligation shall not constitute a breach of this Section.
Section 3.16. Annual Statement as to Compliance.
---------------------------------
The Servicer shall deliver to the Trust Administrator, on or before
May 31st of each year beginning May 31, 2002, an Officer's Certificate, stating
that (i) a review of the activities of the Servicer during the preceding
calendar year and of performance under this Agreement or similar agreements has
been made under such officer's supervision, and (ii) to the best of such
officer's knowledge, based on such review, the Servicer has fulfilled all its
obligations under this Agreement throughout such year, or, if there has been a
default in the fulfillment of any such obligation, specifying each such default
known to such officer and the nature and status thereof and the action being
taken by the Servicer to cure such default. The Trust Administrator shall
forward a copy of each such statement to each Rating Agency and the Trustee.
Section 3.17. Annual Independent Public Accountants' Servicing
Statement; Financial Statements.
------------------------------------------------
On or before May 31st of each year beginning May 31, 2002, the
Servicer, at its expense, shall cause a firm of independent public accountants
which is a member of the American Institute of Certified Public Accountants to
furnish a statement to the Trust Administrator to the effect that such firm has
examined certain documents and records relating to the servicing of the mortgage
loans similar in nature and that such firm is of the opinion that the provisions
of this or similar agreements have been complied with, and that, on the basis of
such examination conducted substantially in compliance with the Uniform Single
Attestation Program for Mortgage Bankers, nothing has come to their attention
which would indicate that such servicing has not been conducted in compliance
therewith, except for (i) such exceptions as such firm shall believe to be
immaterial, and (ii) such other exceptions as shall be set forth in such
statement. By providing the Trust Administrator a copy of a Uniform Single
Attestation Program Report from their independent public accountant's on an
annual basis, the Servicer shall be considered to have fulfilled its obligations
under this Section 3.17. Copies of such statement shall be provided by the Trust
Administrator to any Certificateholder upon request at the Servicer's expense,
provided such statement is delivered by the Servicer to the Trust Administrator.
The Trust Administrator shall forward a copy of each such statement to each
Rating Agency and the Trustee.
Section 3.18. Errors and Omissions Insurance; Fidelity Bonds.
----------------------------------------------
The Servicer shall maintain with responsible companies acceptable to
▇▇▇▇▇▇ ▇▇▇ or ▇▇▇▇▇▇▇ Mac, at its own expense, a blanket fidelity bond and an
errors and omissions insurance policy, with broad coverage on all officers,
employees or other persons acting in any capacity requiring such persons to
handle funds, money, documents or papers relating to the Mortgage Loans
("Servicer Employees"). Any such fidelity bond and errors and omissions
insurance policy shall be in the form of the Mortgage Banker's Blanket Bond and
shall protect and insure the Servicer against losses, including forgery, theft,
embezzlement, fraud, errors and omissions and negligent acts of such Servicer
Employees. Such Fidelity Bond and Errors and Omissions Insurance Policy also
shall protect and insure the Servicer against losses in connection with the
release or satisfaction of a Mortgage Loan without having obtained payment in
full of the indebtedness secured thereby. No provision of this Section 3.18
requiring such fidelity bond and errors and omissions insurance policy shall
diminish or relieve the Servicer from its duties and obligations as set forth in
this Agreement. The minimum coverage under any such fidelity bond and errors and
omissions insurance policy shall be at least equal to the amounts acceptable to
▇▇▇▇▇▇ Mae or ▇▇▇▇▇▇▇ Mac. Upon the request of the Trust Administrator, the
Servicer shall cause to be delivered to the Trust Administrator (who shall
deliver a copy to the Trustee) a certificate of insurance for such fidelity bond
and errors and omissions insurance policy and a statement from the surety and
the insurer that such fidelity bond and errors and omissions insurance policy
shall in no event be terminated or materially modified without 30 days' prior
written notice to the Trust Administrator.
Section 3.19. Restoration of Mortgaged Property.
---------------------------------
The Servicer need not obtain the approval of the Trust Administrator
prior to releasing any Insurance Proceeds or Liquidation Proceeds relating to
condemnation to the Mortgagor to be applied to the restoration or repair of the
Mortgaged Property if such release is in accordance with Accepted Servicing
Practices. For claims greater than $15,000, at a minimum the Servicer shall
comply with the following conditions in connection with any such release of
Insurance Proceeds or Liquidation Proceeds:
(i) The Servicer shall receive satisfactory independent verification
of completion of repairs and issuance of any required approvals with
respect thereto;
(ii) the Servicer shall take all steps necessary to preserve the
priority of the lien of the Mortgage, including, but not limited to
requiring waivers with respect to mechanics' and materialmen's liens;
(iii) the Servicer shall verify that the Mortgage Loan is not in
default; and
(iv) pending repairs or restoration, the Servicer shall place the
Insurance Proceeds or Liquidation Proceeds in the Escrow Account.
Section 3.20. Inspections.
-----------
If any Mortgage Loan is more than 60 days delinquent, the Servicer
immediately shall inspect the Mortgaged Property and shall conduct subsequent
inspections in accordance with Accepted Servicing Practices or as may be
required by the primary mortgage guaranty insurer. The Servicer shall keep a
written report of each such inspection and shall provide the Trust Administrator
and the Trustee with copies upon request.
ARTICLE IV
DISTRIBUTIONS AND ADVANCES BY THE SERVICER
Section 4.01. Advances.
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The Servicer shall determine on or before each Servicer Advance Date
whether it is required to make an Advance pursuant to the definition thereof. If
the Servicer determines it is required to make an Advance, it shall, on or
before the Servicer Advance Date, either (i) deposit into the Collection Account
an amount equal to the Advance or (ii) use any Amount Held for Future
Distribution in discharge of its obligation to make any such Advance. Any funds
so applied shall be replaced by the Servicer by deposit in the Collection
Account no later than the close of business on the next Servicer Advance Date.
The Servicer shall be entitled to be reimbursed from the Collection Account for
all Advances of its own funds made pursuant to this Section as provided in
Section 3.08. The obligation to make Advances with respect to any Mortgage Loan
shall continue if such Mortgage Loan has been foreclosed or otherwise terminated
and the related Mortgaged Property has not been liquidated.
The Servicer shall deliver to the Trust Administrator (who shall
deliver to the Trustee) on the related Servicer Advance Date an Officer's
Certificate of a Servicing Officer indicating the amount of any proposed Advance
determined by the Servicer to be a Nonrecoverable Advance and detailing the
reasons for such determination.
Section 4.02. Priorities of Distribution.
--------------------------
(a) On each Distribution Date, based solely upon the information
in the related Monthly Statement, the Trustee shall withdraw the Available Funds
from the Distribution Account and apply such funds to distributions on the
Certificates in the following order and priority and, in each case, to the
extent of Available Funds remaining:
(i) (Reserved);
(ii) concurrently, to each Class of Senior Certificates, pro rata,
an amount allocable to interest equal to the related Accrued Certificate
Interest, any shortfall being allocated among such Classes in proportion
to the amount of the Accrued Certificate Interest that would have been
distributed in the absence of such shortfall;
(iii) (Reserved);
(iv) concurrently, to the Class A-R and Class A-1 Certificates, in
that order, the Senior Optimal Principal Amount for that Distribution
Date, until the Certificate Principal Balance of each such Class has been
reduced to zero;
(v) to each Class of Junior Certificates, subject to paragraph (e)
below, in the following order of priority:
(A) to the Class B-1 Certificates, an amount allocable to
interest equal to the Accrued Certificate Interest for such Class
for such Distribution Date;
(B) to the Class B-1 Certificates, an amount allocable to
principal equal to its Allocable Share for such Distribution Date
until the Class Principal Balance thereof is reduced to zero;
(C) to the Class B-2 Certificates, an amount allocable to
interest equal to the Accrued Certificate Interest for such Class
for such Distribution Date;
(D) to the Class B-2 Certificates, an amount allocable to
principal equal to its Allocable Share for such Distribution Date
until the Class Principal Balance thereof is reduced to zero;
(E) to the Class B-3 Certificates, an amount allocable to
interest equal to the amount of the Accrued Certificate Interest for
such Class for such Distribution Date;
(F) to the Class B-3 Certificates, an amount allocable to
principal equal to its Allocable Share for such Distribution Date
until the Class Principal Balance thereof has been reduced to zero;
(G) to the Class B-4 Certificates, an amount allocable to
interest equal to the amount of the Accrued Certificate Interest for
such Class for such Distribution Date;
(H) to the Class B-4 Certificates, an amount allocable to
principal equal to its Allocable Share for such Distribution Date
until the Class Principal Balance thereof has been reduced to zero;
(I) to the Class B-5 Certificates, an amount allocable to
interest equal to the Accrued Certificate Interest for such Class
for such Distribution Date;
(J) to the Class B-5 Certificates, an amount allocable to
principal equal to its Allocable Share for such Distribution Date
until the Class Principal Balance thereof is reduced to zero;
(K) to the Class B-6 Certificates, an amount allocable to
interest equal to the Accrued Certificate Interest for such Class
for such Distribution Date; and
(L) to the Class B-6 Certificates, an amount allocable to
principal equal to its Allocable Share for such Distribution Date
until the Class Principal Balance thereof is reduced to zero;
(vi) to the Class A-R Certificates, any remaining funds in the Trust
Fund.
On any Distribution Date, to the extent the Amount Available for
Senior Principal is insufficient to make the full distribution required to be
made pursuant to clause (iv) above, the amount distributable on the Senior
Certificates in respect of principal shall be equal to the product of (1) the
Amount Available for Senior Principal and (2) a fraction, the numerator of which
is the Senior Optimal Principal Amount and the denominator of which is the
Senior Optimal Principal Amount.
(b) On each Distribution Date on or after the Cross-Over Date, the
portion of Available Funds available to be distributed as principal to the
Senior Certificates shall be distributed concurrently, as principal, on such
Classes, pro rata, on the basis of their respective Class Principal Balances,
until the Class Principal Balances thereof are reduced to zero.
(c) On each Distribution Date, the amount referred to in clause
(i) of the definition of Accrued Certificate Interest for each Class of
Certificates for such Distribution Date shall be reduced by (i) the related
Class' pro rata share of Net Prepayment Interest Shortfalls based on such Class'
Accrued Certificate Interest for such Distribution Date without taking into
account such Net Prepayment Interest Shortfalls and (ii) the related Class' Pro
Rata Share of (A) after the Special Hazard Coverage Termination Date, with
respect to each Mortgage Loan that became a Special Hazard Mortgage Loan during
the calendar month preceding the month of such Distribution Date, the excess of
one month's interest at the related Net Mortgage Rate on the Scheduled Principal
Balance of such Mortgage Loan as of the Due Date in such month over the amount
of Liquidation Proceeds applied as interest on such Mortgage Loan with respect
to such month, (B) after the Bankruptcy Coverage Termination Date, with respect
to each Mortgage Loan that became subject to a Bankruptcy Loss during the
calendar month preceding the month of such Distribution Date, the interest
portion of the related Debt Service Reduction or Deficient Valuation, (C) each
Relief Act Reduction incurred during the calendar month preceding the month of
such Distribution Date and (D) after the Fraud Loss Coverage Termination Date,
with respect to each Mortgage Loan that became a Fraud Loan during the calendar
month preceding the month of such Distribution Date, the excess of one month's
interest at the related Net Mortgage Rate on the Scheduled Principal Balance of
such Mortgage Loan as of the Due Date in such month over the amount of
Liquidation Proceeds applied as interest on such Mortgage Loan with respect to
such month.
(d) Notwithstanding the priority and allocation contained in
Section 4.02(a)(v), if with respect to any Class of Class B Certificates on any
Distribution Date, such Class has not satisfied the Class Prepayment
Distribution Trigger, no distribution of amounts pursuant to clauses (ii)(B)(a)
and (iii) of the definition of Junior Optimal Principal Amount will be made to
any such Classes (the "Restricted Classes") and the amount of such amounts
pursuant to clauses (ii)(B)(a) and (iii) of the definition of Junior Optimal
Principal Amount otherwise distributable to the Restricted Classes shall be
distributed to any Classes of Junior Certificates having lower numerical Class
designations than such Class, pro rata, based on their respective Class
Principal Balances immediately prior to such Distribution Date and shall be
distributed in the sequential order provided in Section 4.02(a)(v).
Section 4.03. Allocation of Realized Losses.
-----------------------------
(a) On or prior to each Distribution Date, the Trust Administrator
shall determine the total amount of Realized Losses, including Excess Losses.
Realized Losses with respect to any Distribution Date shall be
allocated as follows:
(i) any Realized Loss (other than an Excess Loss) shall be allocated
first to the Junior Certificates in reverse order of their respective
numerical Class designations (beginning with the Class of Junior
Certificates then outstanding with the highest numerical Class
designation) until the respective Class Principal Balance of each such
Class is reduced to zero, and second to the Senior Certificates, pro rata
on the basis of their respective Class Principal Balances immediately
prior to the related Distribution Date until the respective Class
Principal Balance of each such Class has been reduced to zero; and
(ii) any Excess Losses shall be allocated to the Senior Certificates
and the Junior Certificates then outstanding, pro rata, on the basis of
their respective Class Principal Balances.
(b) The Class Principal Balance of the Class of Junior Certificates
then outstanding with the highest numerical Class designation shall be reduced
on each Distribution Date by the amount, if any, by which the aggregate of the
Class Principal Balances of all outstanding Classes of Certificates (after
giving effect to the distribution of principal and the allocation of Realized
Losses on such Distribution Date) exceeds the Pool Principal Balance for the
following Distribution Date.
(c) Any Realized Loss allocated to a Class of Certificates or any
reduction in the Class Principal Balance of a Class of Certificates pursuant to
Section 4.03(a) above shall be allocated among the Certificates of such Class in
proportion to their respective Certificate Principal Balances.
(d) Any allocation of Realized Losses to a Certificate or any
reduction in the Certificate Principal Balance of a Certificate, pursuant to
Section 4.03(a) above shall be accomplished by reducing the Certificate
Principal Balance thereof, as applicable, immediately following the
distributions made on the related Distribution Date in accordance with the
definition of "Certificate Principal Balance" herein; provided that no Realized
Loss shall be allocated to reduce the Certificate Principal Balance of a
Certificate to the extent that such allocation would reduce the aggregate
Certificate Principal Balance of all classes of Certificates to an amount less
than the Scheduled Principal Balance of all Outstanding Mortgage Loans as of the
Due Date occurring in the month of such Distribution Date, less any Deficiency
Valuations occurring before the Bankruptcy Loss Coverage Termination Date (such
limitation, the "Loss Allocation Limitation").
Section 4.04. Monthly Statements to Certificateholders.
----------------------------------------
(a) Not later than two (2) Business Days prior to each
Distribution Date, the Trust Administrator shall prepare and make available to
each Certificateholder, the Servicer, the Trustee, the Depositor and any other
interested parties a statement based solely on information provided by the
Servicer setting forth the following information with respect to the related
distribution (in the case of information furnished pursuant to (i), (ii) and
(vii) below, the amounts shall be expressed as a dollar amount per minimum
denomination Certificate, such minimum denominations being as set forth in the
Preliminary Statement):
(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 Class Unpaid
Interest Shortfall included in such distribution and any remaining Class
Unpaid Interest Shortfall after giving effect to such distribution;
(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;
(iv) the Certificate Principal Balance as a dollar amount per
minimum denomination Certificate and the Class Principal Balance of each
Class of Certificates, after giving effect to the distribution of
principal on such Distribution Date;
(v) the Pool Principal Balance on such Distribution Date;
(vi) the Pro Rata Senior Percentage, the Senior Percentage and
Junior Percentage for the following Distribution Date;
(vii) the amount of the Servicing Fees paid to or retained by the
Servicer 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 Advances included in the distribution on such
Distribution Date and the aggregate amount of Advances outstanding as of
the close of business on such Distribution Date;
(x) the number and aggregate principal amounts of Mortgage Loans (A)
delinquent (exclusive of Mortgage Loans in foreclosure) (1) 1 to 30 days
(2) 31 to 60 days (3) 61 to 90 days and (4) 91 or more days and (B) in
foreclosure and delinquent (1) 1 to 30 days (2) 31 to 60 days (3) 61 to 90
days and (4) 91 or more days, as of the close of business on the last day
of the calendar month preceding such Distribution Date;
(xi) with respect to any Mortgage Loan that became an REO Property
during the preceding calendar month, the loan number and Scheduled
Principal Balance of such Mortgage Loan as of the close of business on the
last day of the month preceding such Distribution Date and the date of
acquisition thereof;
(xii) the total number and principal balance of any REO Properties
(and market value, if available) as of the close of business on the last
day of the month preceding such Distribution Date;
(xiii) the Senior Prepayment Percentage and the Junior Prepayment
Percentage for the following Distribution Date;
(xiv) the aggregate amount of Realized Losses incurred during the
preceding calendar month; and
(xv) the Special Hazard Loss Coverage Amount, the Fraud Loss
Coverage Amount and the Bankruptcy Loss Coverage Amount, in each case as
of the related Determination Date and the Junior Percentage as of such
Distribution Date.
(b) The Trust Administrator's responsibility for disbursing the
above information to the Certificateholders is limited to the availability,
timeliness and accuracy of the information provided by the Servicer. The Trust
Administrator will make a copy of each statement provided pursuant to this
Section 4.04 (and, at its option, any additional files containing the same
information in an alternative format) available each month to
Certificateholders, and other parties to this Agreement via the Trust
Administrator's internet website located at "▇▇▇.▇▇▇▇▇▇▇.▇▇▇". Assistance in
using the internet website can be obtained by calling the Trust Administrator's
customer service desk at (▇▇▇) ▇▇▇-▇▇▇▇. Parties that are unable to use the
above distribution method are entitled to have a paper copy mailed to them via
first class mail by calling the customer service desk and indicating such. The
Trust Administrator with the consent of the Trustee, which consent shall not be
unreasonably withheld, shall have the right to change the way the Monthly
Statement is distributed in order to make such distribution more convenient
and/or more accessible and the Trust Administrator shall provide timely and
adequate notification to the Certificateholders and the parties to this
Agreement regarding any such changes.
The Trust Administrator shall also be entitled to rely on but shall
not be responsible for the content or accuracy of any information provided by
third parties for purposes of preparing the Monthly Statement and may affix
thereto any disclaimer it deems appropriate in its reasonable discretion
(without suggesting liability on the part of any other party hereto).
As a condition to access the Trust Administrator's internet website,
the Trust Administrator may require registration and the acceptance of a
disclaimer. The Trust Administrator will not be liable for the dissemination of
information in accordance with this Agreement.
(c) On or before the 18th day of each calendar month, or if such
day is not a Business Day, the preceding Business Day, the Servicer shall
deliver to the Trust Administrator (which delivery may be by electronic data
transmission) a report in a form mutually agreeable by the Servicer and the
Trust Administrator. In addition, the Servicer shall make available to the Trust
Administrator upon request any other information in its possession reasonably
necessary for the Trust Administrator to prepare the Monthly Statement.
(d) Within a reasonable period of time after the end of each
calendar year, the Trust Administrator shall cause to be furnished upon request
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) and
(a)(vii) of this Section 4.04 aggregated for such calendar year or applicable
portion thereof during which such Person was a Certificateholder. Such
obligation of the Trust Administrator shall be deemed to have been satisfied to
the extent that substantially comparable information shall be provided by the
Trust Administrator pursuant to any requirements of the Code as from time to
time in effect.
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 which must be in
excess of the applicable minimum denomination) and aggregate denominations per
Class set forth in the Preliminary Statement.
Subject to Section 9.02 hereof respecting the final distribution on
the Certificates, on each Distribution Date the Trustee shall make distributions
to each Certificateholder of record on the preceding Record Date either (x) by
wire transfer in immediately available funds to the account of such holder at a
bank or other entity having appropriate facilities therefor, if (i) such Holder
has so notified the Trustee in writing at least five Business Days prior to the
related Record Date and (ii) such Holder shall hold (A) 100% of the Class
Principal Balance of any Class of Certificates or (B) Certificates of any Class
with aggregate principal Denominations of not less than $1,000,000 or (y) by
check mailed by first class mail to such Certificateholder at the address of
such holder appearing in the Certificate Register.
The Certificates shall be executed by manual or facsimile signature
on behalf of the Trustee by an authorized officer. Certificates bearing the
manual or facsimile signatures of individuals who were, at the time when such
signatures were affixed, authorized to sign on behalf of the Trustee shall bind
the Trustee, notwithstanding that such individuals or any of them have ceased to
be so authorized prior to the countersignature and delivery of such Certificates
or did not hold such offices at the date of such Certificate. No Certificate
shall be entitled to any benefit under this Agreement, or be valid for any
purpose, unless countersigned by the Trustee by manual signature, and such
countersignature upon any Certificate shall be conclusive evidence, and the only
evidence, that such Certificate has been duly executed and delivered hereunder.
All Certificates shall be dated the date of their countersignature. On the
Closing Date, the Trustee shall countersign the Certificates to be issued at the
direction of the Depositor, or any affiliate thereof.
The Depositor shall provide, or cause to be provided, to the Trustee
on a continuous basis, an adequate inventory of Certificates to facilitate
transfers.
Section 5.02. Certificate Register; Registration of Transfer and
Exchange of Certificates.
---------------------------------------------------
(a) The Trustee shall maintain, or cause to be maintained in
accordance with the provisions of Section 5.06 hereof, a Certificate Register
for the Trust Fund in which, subject to the provisions of subsections (b) and
(c) below and to such reasonable regulations as it may prescribe, the Trustee
shall provide for the registration of Certificates and of transfers and
exchanges of Certificates as herein provided. Upon surrender for registration of
transfer of any Certificate, the Trustee shall execute and deliver, in the name
of the designated transferee or transferees, one or more new Certificates of the
same Class and aggregate Percentage Interest.
At the option of a Certificateholder, Certificates may be exchanged
for other Certificates of the same Class in authorized denominations and
evidencing the same aggregate Percentage Interest upon surrender of the
Certificates to be exchanged at the office or agency of the Trustee. Whenever
any Certificates are so surrendered for exchange, the Trustee shall execute,
authenticate, and deliver the Certificates which the Certificateholder making
the exchange is entitled to receive. Every Certificate presented or surrendered
for registration of transfer or exchange shall be accompanied by a written
instrument of transfer in form satisfactory to the Trustee duly executed by the
holder thereof or his attorney duly authorized in writing.
No service charge to the Certificateholders shall be made for any
registration of transfer or exchange of Certificates, but payment of a sum
sufficient to cover any tax or governmental charge that may be imposed in
connection with any transfer or exchange of Certificates may be required.
All Certificates surrendered for registration of transfer or
exchange shall be canceled and subsequently destroyed by the Trustee in
accordance with the Trustee's customary procedures.
(b) No transfer of a Private Certificate shall be made unless such
transfer is made pursuant to an effective registration statement under the
Securities Act and any applicable state securities laws or is exempt from the
registration requirements under said Act and such state securities laws. In the
event that a transfer is to be made in reliance upon an exemption from the
Securities Act and such laws, in order to assure compliance with the Securities
Act and such laws, the Certificateholder desiring to effect such transfer and
such Certificateholder's prospective transferee (other than the Depositor or an
affiliate of the Depositor) shall each certify to the Trustee in writing the
facts surrounding the transfer in substantially the forms set forth in Exhibit I
(the "Transferor Certificate") and (i) deliver a letter in substantially the
form of either Exhibit J (the "Investment Letter") or Exhibit K (the "Rule 144A
Letter") or (ii) there shall be delivered to the Trustee at the expense of the
transferor an Opinion of Counsel that such transfer may be made pursuant to an
exemption from the Securities Act. 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 Servicer 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 and provided such information is in the Trustee's
or the Servicer's possession. Each Holder of a Private Certificate desiring to
effect such transfer shall, and does hereby agree to, indemnify the Trustee, the
Depositor, and the 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.
No transfer of an ERISA-Restricted Certificate shall be made unless
the Trustee shall have received (other than the Depositor or an affiliate of the
Depositor) either (i) a representation from the transferee of such Certificate
acceptable to and in form and substance satisfactory to the Trustee (in the
event such Certificate is a Private Certificate, such requirement is satisfied
only by the Trustee's receipt of a representation letter from the transferee
substantially in the form of Exhibit J or Exhibit K), to the effect that such
transferee is not an employee benefit plan or arrangement subject to Section 406
of ERISA or a plan or arrangement subject to Section 4975 of the Code, or 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, (ii) if the purchaser is an insurance company, a representation
that the purchaser is an insurance company which is purchasing such Certificates
with funds contained in an "insurance company general account" (as such term is
defined in Section V(e) of Prohibited Transaction Class Exemption 95-60 ("PTCE
95-60")) and that the purchase and holding of such Certificates are covered
under PTCE 95-60 or (iii) in the case of any such ERISA-Restricted Certificate,
other than a Residual 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 trustee of any such plan or any other person acting on behalf
of any such plan or arrangement, or using such plan's or arrangement's assets,
an Opinion of Counsel satisfactory to the Trustee, which Opinion of Counsel
shall not be an expense of either the Trustee or the Trust Fund, addressed to
the Trustee to the effect that the purchase or holding of such ERISA-Restricted
Certificate will not result in the assets of the Trust Fund being deemed to be
"plan assets" and subject to the prohibited transaction provisions of ERISA and
the Code and will not subject the Trustee 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, in the event the representation letter referred to in the
preceding sentence is not so furnished, such representation shall be deemed to
have been made to the Trustee by the transferee's (including an initial
acquirer's) acceptance of the ERISA-Restricted Certificates. Notwithstanding
anything else to the contrary herein, any purported transfer of an
ERISA-Restricted Certificate to or on behalf of an employee benefit plan subject
to ERISA or to the Code without the delivery to the Trustee of an Opinion of
Counsel satisfactory to the Trustee as described above shall be void and of no
effect.
To the extent permitted under applicable law (including, but not
limited to, ERISA), the Trustee shall be under no liability to any Person for
any registration of transfer of any ERISA-Restricted Certificate that is in fact
not permitted by this Section 5.02(b) or for making any payments due on such
Certificate to the Holder thereof or taking any other action with respect to
such Holder under the provisions of this Agreement so long as the transfer was
registered by the Trustee in accordance with the foregoing requirements.
(c) Each Person who has or who acquires any Ownership Interest in
a Residual Certificate shall be deemed by the acceptance or acquisition of such
Ownership Interest to have agreed to be bound by the following provisions, and
the rights of each Person acquiring any Ownership Interest in a Residual
Certificate are expressly subject to the following provisions:
(i) Each Person holding or acquiring any Ownership Interest in a
Residual Certificate shall be a Permitted Transferee and shall promptly
notify the Trustee of any change or impending change in its status as a
Permitted Transferee.
(ii) No Ownership Interest in a Residual Certificate may be
registered on the Closing Date or thereafter transferred, and the Trustee
shall not register the Transfer of any Residual Certificate unless, in
addition to the certificates required to be delivered to the Trustee under
subparagraph (b) above, the Trustee shall have been furnished with an
affidavit (a "Transfer Affidavit") of the initial owner or the proposed
transferee (other than the Depositor of an affiliate thereof) in the form
attached hereto as Exhibit H.
(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. The Trustee shall be under no
liability to any Person for any registration of Transfer of a Residual
Certificate that is in fact not permitted by Section 5.02(b) and this
Section 5.02(c) or for making any payments due on such Certificate to the
Holder thereof or taking any other action with respect to such Holder
under the provisions of this Agreement so long as the Transfer was
registered after receipt of the related Transfer Affidavit, Transferor
Certificate and either the Rule 144A Letter or the Investment Letter. The
Trustee shall be entitled but not obligated to recover from any Holder of
a Residual Certificate that was in fact not a Permitted Transferee at the
time it became a Holder or, at such subsequent time as it became other
than a Permitted Transferee, all payments made on such Residual
Certificate at and after either such time. Any such payments so recovered
by the Trustee shall be paid and delivered by the Trustee to the last
preceding Permitted Transferee of such Certificate.
(v) The Depositor shall use its best efforts to make available, upon
receipt of written request from the Trustee, all information necessary to
compute any tax imposed under Section 860E(e) of the Code as a result of a
Transfer of an Ownership Interest in a Residual Certificate to any Holder
who is not a Permitted Transferee described in clauses (i) through (iv) of
the definition thereof.
The restrictions on Transfers of a Residual Certificate set forth in
this Section 5.02(c) shall cease to apply (and the applicable portions of the
legend on a Residual Certificate may be deleted) with respect to Transfers
occurring after delivery to the Trustee of an Opinion of Counsel, which Opinion
of Counsel shall not be an expense of the Trust Fund, the Trustee, the Loan
Seller, the Transferors or the Servicer, to the effect that the elimination of
such restrictions will not cause any REMIC hereunder to fail to qualify as a
REMIC at any time that the Certificates are outstanding or result in the
imposition of any tax on the Trust Fund, a Certificateholder or another Person.
Each Person holding or acquiring any Ownership Interest in a Residual
Certificate hereby consents to any amendment of this Agreement which, based on
an Opinion of Counsel furnished to the Trustee, is reasonably necessary (a) to
ensure that the record ownership of, or any beneficial interest in, a Residual
Certificate is not transferred, directly or indirectly, to a Person that is 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
Trustee except to another Depository; (ii) the Depository shall maintain
book-entry records with respect to the Certificate Owners and with respect to
ownership and transfers of such Book-Entry Certificates; (iii) ownership and
transfers of registration of the Book-Entry Certificates on the books of the
Depository shall be governed by applicable rules established by the Depository;
(iv) the Depository may collect its usual and customary fees, charges and
expenses from its Depository Participants; (v) the Trustee shall deal with the
Depository, Depository Participants and indirect participating firms as
representatives of the Certificate Owners of the Book-Entry Certificates for
purposes of exercising the rights of holders under this Agreement, and requests
and directions for and votes of such representatives shall not be deemed to be
inconsistent if they are made with respect to different Certificate Owners; and
(vi) the Trustee may rely and shall be fully protected in relying upon
information furnished by the Depository with respect to its Depository
Participants and furnished by the Depository Participants with respect to
indirect participating firms and persons shown on the books of such indirect
participating firms as direct or indirect Certificate Owners.
All transfers by Certificate Owners of Book-Entry Certificates shall
be made in accordance with the procedures established by the Depository
Participant or brokerage firm representing such Certificate Owner. Each
Depository Participant shall only transfer Book-Entry Certificates of
Certificate Owners it represents or of brokerage firms for which it acts as
agent in accordance with the Depository's normal procedures.
If (x) (i) the Depository or the Depositor advises the Trustee in
writing that the Depository is no longer willing or able to properly discharge
its responsibilities as Depository, and (ii) the Trustee or the Depositor is
unable to locate a qualified successor, (y) the Depositor at its option advises
the Trustee in writing that it elects to terminate the book-entry system through
the Depository or (z) after the occurrence of a Servicer Event of Termination,
Certificate Owners representing at least 51% of the Certificate Principal
Balance of the Book-Entry Certificates together advise the Trustee and the
Depository through the Depository Participants in writing that the continuation
of a book-entry system through the Depository is no longer in the best interests
of the Certificate Owners, the Trustee shall notify all Certificate Owners,
through the Depository, of the occurrence of any such event and of the
availability of definitive, fully-registered Certificates (the "Definitive
Certificates") to Certificate Owners requesting the same. Upon surrender to the
Trustee of the related Class of Certificates by the Depository, accompanied by
the instructions from the Depository for registration, the Trustee shall issue
the Definitive Certificates. Neither the Servicer, the Depositor, the Trust
Administrator nor the Trustee shall be liable for any delay in delivery of such
instruction and each may conclusively rely on, and shall be protected in relying
on, such instructions. The Servicer shall provide the Trustee with an adequate
inventory of certificates to facilitate the issuance and transfer of Definitive
Certificates. Upon the issuance of Definitive Certificates all references herein
to obligations imposed upon or to be performed by the Depository shall be deemed
to be imposed upon and performed by the Trustee, to the extent applicable with
respect to such Definitive Certificates and the Trustee shall recognize the
Holders of the Definitive Certificates as Certificateholders hereunder; provided
that the Trustee shall not by virtue of its assumption of such obligations
become liable to any party for any act or failure to act of the Depository.
Section 5.03. Mutilated, Destroyed, Lost or Stolen Certificates.
-------------------------------------------------
If (a) any mutilated Certificate is surrendered to the Trustee, or
the Trustee receives evidence to its satisfaction of the destruction, loss or
theft of any Certificate and (b) there is delivered to the Servicer and the
Trustee such security or indemnity as may be required by them to save each of
them harmless, then, in the absence of notice to the Trustee that such
Certificate has been acquired by a bona fide purchaser, the Trustee shall
execute, countersign and deliver, in exchange for or in lieu of any such
mutilated, destroyed, lost or stolen Certificate, a new Certificate of like
Class, tenor and Percentage Interest. In connection with the issuance of any new
Certificate under this Section 5.03, the Trustee may require the payment of a
sum sufficient to cover any tax or other governmental charge that may be imposed
in relation thereto and any other expenses (including the fees and expenses of
the Trustee) connected therewith. Any replacement Certificate issued pursuant to
this Section 5.03 shall constitute complete and indefeasible evidence of
ownership, as if originally issued, whether or not the lost, stolen or destroyed
Certificate shall be found at any time.
Section 5.04. Persons Deemed Owners.
---------------------
The Servicer, the Trustee and any agent of the Servicer or the
Trustee may treat the Person in whose name any Certificate is registered as the
owner of such Certificate for the purpose of receiving distributions as provided
in this Agreement and for all other purposes whatsoever, and neither the
Servicer, the Trustee nor any agent of the Servicer or the Trustee shall be
affected by any notice to the contrary.
Section 5.05. Access to List of Certificateholders' Names and
Addresses.
-----------------------------------------------
If three or more Certificateholders (a) request such information in
writing from the Trustee, (b) state that such Certificateholders desire to
communicate with other Certificateholders with respect to their rights under
this Agreement or under the Certificates, and (c) provide a copy of the
communication which such Certificateholders propose to transmit, or if the
Depositor or Servicer shall request such information in writing from the
Trustee, then the Trustee shall, within ten Business Days after the receipt of
such request, provide the Depositor, the Servicer or such Certificateholders at
such recipients' expense the most recent list of the Certificateholders of such
Trust Fund held by the Trustee, if any. The Depositor and every
Certificateholder, by receiving and holding a Certificate, agree that the
Trustee shall not be held accountable by reason of the disclosure of any such
information as to the list of the Certificateholders hereunder, regardless of
the source from which such information was derived.
Section 5.06. Maintenance of Office or Agency.
-------------------------------
The Trustee will maintain or cause to be maintained at its expense
an office or offices or agency or agencies in New York City where Certificates
may be surrendered for registration of transfer or exchange. The Trustee
initially designates its Corporate Trust Office for such purposes. The Trustee
will give prompt written notice to the Certificateholders of any change in such
location of any such office or agency.
ARTICLE VI
THE DEPOSITOR AND THE SERVICER
Section 6.01. Respective Liabilities of the Depositor and the
Servicer.
-----------------------------------------------
The Depositor and the Servicer shall each be liable in accordance
herewith only to the extent of the obligations specifically and respectively
imposed upon and undertaken by them herein.
Section 6.02. Merger or Consolidation of the Depositor or the
Servicer.
---------------------------------------------------
The Depositor and the Servicer will each keep in full effect its
existence, rights and franchises as a corporation or limited partnership, 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 or legal entity, as the case may be, 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 or the Servicer may be merged or
consolidated, or any Person resulting from any merger or consolidation to which
the Depositor or the Servicer shall be a party, or any person succeeding to the
business of the Depositor or the Servicer, shall be the successor of the
Depositor or the Servicer, as the case may be, hereunder, without the execution
or filing of any paper or any further act on the part of any of the parties
hereto, anything herein to the contrary notwithstanding; provided, however, that
the successor or surviving Person to the Servicer shall be qualified to sell
mortgage loans to, and to service mortgage loans on behalf of, ▇▇▇▇▇▇ ▇▇▇ or
▇▇▇▇▇▇▇ Mac.
Section 6.03. Limitation on Liability of the Depositor, the Loan
Seller, the Originator, the Servicer and Others.
---------------------------------------------------
None of the Depositor, the Loan Seller, the Originator, the Servicer
or any of the directors, officers, employees or agents of the Depositor, the
Loan Seller, the Originator or the Servicer shall be under any liability to the
Certificateholders for any action taken or for refraining from the taking of any
action in good faith pursuant to this Agreement, or for errors in judgment;
provided, however, that this provision shall not protect the Depositor, the Loan
Seller, the Originator, the Servicer or any such Person against any breach of
representations or warranties made by it herein or protect the Depositor, the
Loan Seller, the Originator, the Servicer or any such Person from any liability
which would otherwise be imposed by reasons of willful misfeasance, bad faith or
negligence in the performance of duties or by reason of reckless disregard of
obligations and duties hereunder. The Depositor, the Loan Seller, the
Originator, the Servicer and any director, officer, employee or agent of the
Depositor, the Loan Seller, the Originator or the Servicer may rely in good
faith on any document of any kind prima facie properly executed and submitted by
any Person respecting any matters arising hereunder. The Depositor, the Loan
Seller, the Originator, the Servicer and any director, officer, employee or
agent of the Depositor, the Loan Seller, the Originator or the Servicer shall be
indemnified by the Trust Fund and held harmless against any loss, liability or
expense incurred in connection with any audit, controversy or judicial
proceeding relating to a governmental taxing authority or any legal action
relating to this Agreement or the Certificates, other than any loss, liability
or expense related to any specific Mortgage Loan or Mortgage Loans (except as
any such loss, liability or expense shall be otherwise reimbursable pursuant to
this Agreement) and any loss, liability or expense incurred by reason of willful
misfeasance, bad faith or negligence in the performance of duties hereunder or
by reason of reckless disregard of obligations and duties hereunder. None of the
Depositor, the Loan Seller, the Originator or the Servicer shall be under any
obligation to appear in, prosecute or defend any legal action that is not
incidental to its respective duties hereunder and which in its opinion may
involve it in any expense or liability; provided, however, that any of the
Depositor, the Loan Seller, the Originator or the Servicer 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 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, the Loan
Seller, the Originator and the Servicer shall be entitled to be reimbursed
therefor out of the Collection Account.
Section 6.04. Limitation on Resignation of Servicer.
-------------------------------------
The Servicer shall not resign from the obligations and duties hereby
imposed on it except (a) upon appointment of a successor servicer and receipt by
the Trustee and the Trust Administrator of a letter from each Rating Agency that
such a resignation and appointment will not result in a downgrading of the
rating of any of the Certificates, without regard to the guaranty provided by
the Policies, (b) upon determination that its duties hereunder are no longer
permissible under applicable law, or (c) by mutual consent of the Servicer, the
Trustee and the Trust Administrator. Any such determination under clause (b)
permitting the resignation of the Servicer shall be evidenced by an Opinion of
Counsel to such effect delivered to the Trustee and the Trust Administrator and
in form and substance acceptable to the Trustee and the Trust Administrator. No
such resignation shall become effective until the Trust Administrator or a
successor servicer shall have assumed the Servicer's responsibilities, duties,
liabilities and obligations hereunder.
ARTICLE VII
DEFAULT
Section 7.01. Events of Default.
-----------------
"Servicer Event of Termination," wherever used herein, means any one
of the following events:
(i) any failure by the Servicer to deposit in the Collection Account
or remit to the Trust Administrator any payment required to be made under
the terms of this Agreement, which failure shall continue unremedied for
two days after the date upon which written notice of such failure shall
have been given to the Servicer by the Trust Administrator, the Trustee or
the Depositor or to the Servicer, the Trustee and the Trust Administrator
by the Holders of Certificates having not less than 25% of the Voting
Rights evidenced by the Certificates (provided, however, that the Servicer
shall pay the Trust Administrator interest on such late payment at the
prime rate (as set forth in the Wall Street Journal) until such late
payment is received by the Trust Administrator); or
(ii) any failure by the Servicer to observe or perform in any
material respect any other of the covenants or agreements on the part of
the Servicer contained in this Agreement which failure continues
unremedied for a period of 90 days after the date on which written notice
of such failure shall have been given to the Servicer by the Trustee or
the Depositor, or to the Servicer and the Trustee by the Holders of
Certificates evidencing not less than 25% of the Voting Rights evidenced
by the Certificates; or
(iii) a decree or order of a court or agency or supervisory
authority having jurisdiction in the premises for the appointment of a
receiver or liquidator in any insolvency, readjustment of debt,
marshalling of assets and liabilities or similar proceedings, or for the
winding-up or liquidation of its affairs, shall have been entered against
the Servicer and such decree or order shall have remained in force
undischarged or unstayed for a period of 60 consecutive days; or
(iv) the Servicer shall consent to the appointment of a receiver or
liquidator in any insolvency, readjustment of debt, marshalling of assets
and liabilities or similar proceedings of or relating to the Servicer or
all or substantially all of the property of the Servicer; or
(v) the Servicer shall admit in writing its inability to pay its
debts generally as they become due, file a petition to take advantage of,
or commence a voluntary case under, any applicable insolvency or
reorganization statute, make an assignment for the benefit of its
creditors, or voluntarily suspend payment of its obligations.
If a Servicer Event of Termination described in clauses (i) to (vi)
of this Section shall occur, then, and in each and every such case, so long as
such Servicer Event of Termination shall not have been remedied, the Trustee
may, or at the direction of the Holders of Certificates evidencing not less than
25% of the Voting Rights evidenced by the Certificates, the Trustee shall by
notice in writing to the Servicer and the Trust Administrator (with a copy to
each Rating Agency), terminate all of the rights and obligations of the Servicer
under this Agreement and in and to the Mortgage Loans and the proceeds thereof,
other than its rights as a Certificateholder hereunder. On and after the receipt
by the Servicer of such written notice, all authority and power of the Servicer
hereunder, whether with respect to the Mortgage Loans or otherwise, shall,
within a period not to exceed ninety (90) days, pass to and be vested in the
Trust Administrator. The Trust Administrator, in its capacity as successor
servicer, shall thereupon make any Advance which the Servicer failed to make
subject to Section 3.04 hereof subject to a determination of non-recoverability.
The Trust Administrator is hereby authorized and empowered to execute and
deliver, on behalf of the Servicer, as attorney-in-fact or otherwise, any and
all documents and other instruments, and to do or accomplish all other acts or
things necessary or appropriate to effect the purposes of such notice of
termination, whether to complete the transfer and endorsement or assignment of
the Mortgage Loans and related documents, or otherwise. Unless expressly
provided in such written notice, no such termination shall affect any obligation
of the Servicer to pay amounts owed pursuant to Article VIII. The Servicer
agrees to cooperate with the Trust Administrator in effecting the termination of
the Servicer's responsibilities and rights hereunder, including, without
limitation, the transfer to the Trust Administrator of all cash amounts which
shall at the time be credited to the Collection Account, or thereafter be
received with respect to the Mortgage Loans.
Notwithstanding any termination of the activities of the Servicer
hereunder, the Servicer shall be entitled to receive, out of any late collection
of a Scheduled Payment on a Mortgage Loan which was due prior to the notice
terminating such Servicer's rights and obligations as Servicer hereunder and
received after such notice, that portion thereof to which such Servicer would
have been entitled pursuant to Sections 3.08(a)(i) through (viii), and any other
amounts payable to such Servicer hereunder the entitlement to which arose prior
to the termination of its activities hereunder.
Section 7.02. Trust Administrator to Act; Appointment of
Successor.
------------------------------------------
On and after the time the Servicer receives a notice of termination
pursuant to Section 7.01 hereof, the Trust Administrator shall, subject to and
to the extent provided in Section 3.04, be the successor to the Servicer in its
capacity as servicer under this Agreement and the transactions set forth or
provided for herein and shall be subject to all the responsibilities, duties and
liabilities relating thereto placed on the Servicer by the terms and provisions
hereof and applicable law including the obligation to make Advances pursuant to
Section 4.01. As compensation therefor, the Trust Administrator shall be
entitled to all funds relating to the Mortgage Loans that the Servicer would
have been entitled to charge to the Collection Account or Distribution Account
if the Servicer had continued to act hereunder. Notwithstanding the foregoing,
if the Trust Administrator has become the successor to the Servicer in
accordance with Section 7.01 hereof, the Trust Administrator may, if it shall be
unwilling to so act, or shall, if it is prohibited by applicable law from making
Advances pursuant to Section 4.01 hereof or if it is otherwise unable to so act,
or if it has been requested in writing by Holders of Certificates evidencing not
less than 25% of the Voting Rights evidenced by the Certificates to do so,
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 the Servicer hereunder in the assumption of all or
any part of the responsibilities, duties or liabilities of the Servicer
hereunder. Any successor to the Servicer shall be an institution which is a
▇▇▇▇▇▇ ▇▇▇ and ▇▇▇▇▇▇▇ Mac approved seller/servicer in good standing, which has
a net worth of at least $15,000,000, and which is willing to service the
Mortgage Loans and executes and delivers to the Depositor, the Trustee and the
Trust Administrator an agreement accepting such delegation and assignment, which
contains an assumption by such Person of the rights, powers, duties,
responsibilities, obligations and liabilities of the Servicer (other than
liabilities of the Servicer under Section 6.03 hereof incurred prior to
termination of the Servicer under Section 7.01), with like effect as if
originally named as a party to this Agreement; and provided further 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, without regard to the guaranty provided by the Policies, as a result of
such assignment and delegation. Pending appointment of a successor to the
Servicer hereunder, the Trust Administrator, unless the Trust Administrator is
prohibited by law from so acting, shall, subject to Section 3.04 hereof, act in
such capacity as hereinabove provided. In connection with such appointment and
assumption, the Trust Administrator may make such arrangements for the
compensation of such successor out of payments on Mortgage Loans as it and such
successor shall agree; provided, however, that no such compensation shall be in
excess of the Servicing Fee permitted the Servicer hereunder. The Trust
Administrator and such successor shall take such action, consistent with this
Agreement, as shall be necessary to effectuate any such succession. Neither the
Trust Administrator nor any other successor servicer shall be deemed to be in
default hereunder by reason of any failure to make, or any delay in making, any
distribution hereunder or any portion thereof or any failure to perform, or any
delay in performing, any duties or responsibilities hereunder, in either case
caused by the failure of the Servicer to deliver or provide, or any delay in
delivering or providing, any cash, information, documents or records to it.
Any successor to the Servicer as servicer shall give notice to the
Mortgagors of such change of servicer and shall, during the term of its service
as servicer maintain in force the policy or policies that the Servicer is
required to maintain pursuant to Section 3.09.
The Trust Administrator or successor servicer shall be entitled to
be reimbursed from the Servicer for all costs associated with the transfer of
servicing from the predecessor servicer, including, without limitation, any
costs or expenses (including but not limited to personnel time) associated with
the complete transfer of all servicing data and the completion, correction or
manipulation of such servicing data as may be required by the Trust
Administrator or successor servicer to correct any errors or insufficiencies in
the servicing data or otherwise to enable the Trust Administrator or successor
servicer to service the Mortgage Loans properly and effectively. If the Servicer
does not pay such reimbursement within thirty (30) days of its receipt of an
invoice therefor, such reimbursement shall be an expense of the Trust and the
Trust Administrator shall be entitled to withdraw such reimbursement from
amounts on deposit in the Trust Administrator Account pursuant to Section
3.08(b)(iv); provided that the Servicer shall reimburse the Trust for any such
expense incurred by the Trust.
Section 7.03. Notification to Certificateholders.
----------------------------------
(a) Upon any termination of or appointment of a successor to the
Servicer, the Trust Administrator shall give prompt written notice thereof to
Certificateholders, the Trustee and to each Rating Agency.
(b) Within 60 days after the occurrence of any Servicer Event of
Termination, the Trust Administrator shall transmit by mail to all
Certificateholders and the Trustee notice of each such Servicer Event of
Termination hereunder known to the Trust Administrator, unless such Servicer
Event of Termination shall have been cured or waived.
ARTICLE VIII
CONCERNING THE TRUSTEE AND THE TRUST ADMINISTRATOR
Section 8.01. Duties of Trustee and the Trust Administrator.
---------------------------------------------
Each of the Trustee and the Trust Administrator, prior to the
occurrence of a Servicer Event of Termination and after the curing of all Events
of Default that may have occurred, shall undertake to perform such duties and
only such duties as are specifically set forth in this Agreement. In case a
Servicer Event of Termination has occurred and remains uncured, each of the
Trustee and the Trust Administrator 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.
Each of the Trustee and the Trust Administrator, upon receipt of all
resolutions, certificates, statements, opinions, reports, documents, orders or
other instruments furnished to the Trustee or the Trust Administrator, as
applicable, 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 neither the Trustee
nor the Trust Administrator shall 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 Trustee or the Trust
Administrator, as applicable, shall notify the Certificateholders of such
non-conforming instrument in the event the Trustee or the Trust Administrator,
after so requesting, does not receive a satisfactorily corrected instrument.
No provision of this Agreement shall be construed to relieve either
the Trustee or the Trust Administrator from liability for its own negligent
action, its own negligent failure to act or its own willful misconduct;
provided, however, that:
(i) unless a Servicer Event of Termination the Trustee or the Trust
Administrator has actual knowledge of shall have occurred and be
continuing, the duties and obligations of the Trustee or the Trust
Administrator shall be determined solely by the express provisions of this
Agreement, neither the Trustee nor the Trust Administrator shall be liable
except for the performance of such duties and obligations as are
specifically set forth in this Agreement, no implied covenants or
obligations shall be read into this Agreement against the Trustee or the
Trust Administrator and the Trustee and the Trust Administrator, as
applicable, may conclusively rely, as to the truth of the statements and
the correctness of the opinions expressed therein, upon any certificates
or opinions furnished to the Trustee or the Trust Administrator, as
applicable, 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;
(ii) neither the Trustee nor the Trust Administrator, as applicable,
shall be liable for an error of judgment made in good faith by a
Responsible Officer or Responsible Officers of the Trustee or the Trust
Administrator, as applicable, unless it shall be finally proven that the
Trustee or the Trust Administrator, as applicable, was negligent in
ascertaining the pertinent facts;
(iii) neither the Trustee nor the Trust Administrator, as
applicable, shall 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 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 the
Trust Administrator, as applicable, or exercising or omitting to exercise
any trust or power conferred upon the Trustee or the Trust Administrator,
as applicable, under this Agreement; and
(iv) The Trustee shall not be accountable, have liability or make
any representation as to any acts or omissions hereunder of the Servicer.
Subject to Section 7.02, the Trust Administrator shall not be accountable,
shall not have liability nor make any representation as to any acts or
omissions hereunder of the Servicer until such time as the Trust
Administrator may be required to act as Servicer pursuant to Section 7.02
and thereupon only for the acts or omissions of the Trust Administrator as
successor Servicer.
Section 8.02. Certain Matters Affecting the Trustee and the
Trust Administrator.
---------------------------------------------
Except as otherwise provided in Section 8.01:
(i) each of the Trustee and the Trust Administrator may request and
rely upon and shall be protected in acting or refraining from acting upon
any resolution, Officers' 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 neither the Trustee nor the Trust
Administrator shall have any responsibility to ascertain or confirm the
genuineness of any signature of any such party or parties;
(ii) the Trustee and the Trust 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;
(iii) neither the Trustee nor the Trust Administrator shall 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;
(iv) prior to the occurrence of a Servicer Event of Termination of
which it has actual knowledge and after the curing of all Servicer Events
of Termination which may have occurred, neither the Trustee nor the Trust
Administrator shall be bound to make any investigation into the facts or
matters stated in any resolution, certificate, statement, instrument,
opinion, report, notice, request, consent, order, approval, bond or other
paper or document, unless requested in writing 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 or the Trust Administrator of the
costs, expenses or liabilities likely to be incurred by it in the making
of such investigation is, in the opinion of the Trustee or the Trust
Administrator, not reasonably assured to the Trustee or the Trust
Administrator by the security afforded to it by the terms of this
Agreement, the Trustee or the Trust Administrator may require reasonable
indemnity against such expense or liability as a condition to so
proceeding. The reasonable expense of every such examination shall be paid
by the Servicer or, if paid by the Trustee or the Trust Administrator,
shall be reimbursed by the Servicer upon demand. Nothing in this clause
(iv) shall derogate from the obligation of the Servicer to observe any
applicable law prohibiting disclosure of information regarding the
Mortgagors;
(v) each of the Trustee and the Trust 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 neither
the Trustee nor the Trust Administrator shall be responsible for any
misconduct or negligence on the part of any such agent, attorney or
custodian appointed by the Trustee or the Trust Administrator with due
care;
(vi) neither the Trustee nor the Trust Administrator 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 adequate indemnity against
such risk or liability is not assured to it. None of the provisions
contained in this Agreement shall in any event require the Trustee to
perform, or be responsible for the manner of performance of, any of the
obligations of the Servicer under this Agreement. None of the provisions
contained in this Agreement shall in any event require the Trust
Administrator to perform, or be responsible for the manner of performance
of, any of the obligations of the Servicer under this Agreement, except
during such time, if any, as the Trust Administrator shall be the
successor to, and be vested with the rights, duties, powers and privileges
of, the Servicer in accordance with the terms of this Agreement;
(vii) 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);
(viii) the Trust Administrator shall not be liable for any loss on
any investment of funds pursuant to this Agreement, except as specified
herein with respect to Permitted Investments of funds in the Trust
Administrator Account and the Distribution Account (other than as issuer
of the investment security);
(ix) neither the Trustee nor the Trust Administrator, as applicable,
shall be deemed to have knowledge of a Servicer Event of Termination until
a Responsible Officer of the Trustee or the Trust Administrator, as
applicable, obtains actual knowledge of such failure or the Trustee or the
Trust Administrator, as applicable, receives written notice of such
failure from the Servicer or the holders of Certificates evidencing not
less than 25% of the Voting Rights of Certificates. In the absence of such
receipt of such notice, each of the Trustee and the Trust Administrator
may conclusively assume that there is no Servicer Event of Termination;
and
(x) neither the Trustee nor the Trust Administrator, as applicable,
shall be under any 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
Trustee or the Trust Administrator, as applicable, reasonable security or
indemnity satisfactory to the Trustee and the Trust Administrator against
the costs, expenses and liabilities which may be incurred therein or
thereby.
Neither the Trustee nor the Trust Administrator shall have any duty
(A) to see to any recording, filing, or depositing of this Agreement or any
agreement referred to herein or any financing statement or continuation
statement evidencing a security interest, or to see to the maintenance of any
such recording or filing or depositing or to any rerecording, refiling or
redepositing of any thereof, (B) to see to any insurance or (C) to see to the
payment or discharge of any tax, assessment, or other governmental charge or any
lien or encumbrance of any kind owing with respect to, assessed or levied
against, any part of the Trust Fund other than from funds available in the
Distribution Account.
Section 8.03. Neither Trustee nor Trust Administrator 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 Originator, as the case may be, and
neither the Trustee nor the Trust Administrator assumes any responsibility for
their correctness. Neither the Trustee nor the Trust Administrator makes any
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 Trustee's execution and counter-signature of the Certificates. Neither
the Trustee nor Trust Administrator shall be accountable for the use or
application by the Depositor or the Servicer of any funds paid to the Depositor
or the Servicer in respect of the Mortgage Loans or deposited in or withdrawn
from the Collection Account by the Depositor or the Servicer.
Section 8.04. Trustee and Trust Administrator May Own
Certificates.
---------------------------------------
Each of the Trustee and the Trust Administrator 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 or the Trust Administrator's.
Section 8.05. Expenses of the Trustee and Trust Administrator.
-----------------------------------------------
The Trustee, the Trust 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 Trustee and the Trust Administrator shall be indemnified by the
Trust and held harmless against any loss, liability or expense (including
reasonable attorneys' fees) (i) incurred in connection with any claim or legal
action relating to (a) this Agreement or (b) the Certificates or (ii) incurred
in connection with the performance of any of the Trustee's or the Trust
Administrator's duties hereunder, other than any loss, liability or expense (x)
incurred by reason of willful misfeasance, bad faith or negligence in the
performance of any of the Trustee's or the Trust Administrator's duties
hereunder, as applicable, (y) incurred by reason of any action of the Trustee or
the Trust Administrator, as applicable, taken at the direction of the
Certificateholders, or (z) which would not constitute an "unanticipated expense
incurred by the REMIC" within the meaning of Treasury Regulations Section
1.860G-1(b)(3)(ii) and (iii) resulting from any error in any tax or information
return prepared by the Servicer. Such indemnity shall survive the termination of
this Agreement or the resignation or removal of the Trustee or the Trust
Administrator hereunder. Without limiting the foregoing, the Trust Administrator
and the Trustee, except for any such expense, disbursement or advance as may
arise from the Trustee's or the Trust Administrator's negligence, bad faith or
willful misconduct, as applicable, or which would not be an "unanticipated
expense" within the meaning of the second preceding sentence, shall be
reimbursed from the Trust Fund for all reasonable expenses, disbursements and
advances incurred or made by the Trustee or the Trust Administrator, as
applicable, 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 of any accountant,
engineer, appraiser or other agent that is not regularly employed by the Trustee
or the Trust Administrator, as applicable, to the extent that the Trustee or the
Trust Administrator, as applicable, 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 Trust
Administrator Account. Except as otherwise provided herein, neither the Trustee
nor the Trust Administrator shall be entitled to payment or reimbursement for
any routine ongoing expenses incurred by the Trustee or the Trust Administrator
in the ordinary course of its duties as Trustee, Trust Administrator, registrar
or paying agent hereunder or for any other expenses. The compensation payable to
the Trustee for its services under this Agreement shall be payable by the Trust
Administrator from its own funds annually in advance in accordance with a fee
agreement between the Trustee and the Trust Administrator.
Section 8.06. Eligibility Requirements for Trustee and Trust
Administrator.
----------------------------------------------
Each of the Trustee and the Trust Administrator hereunder shall at
all times be a corporation or association organized and doing business under the
laws of a state or the United States of America, authorized under such laws to
exercise corporate trust powers, having a combined capital and surplus of at
least $50,000,000, subject to supervision or examination by federal or state
authority and with a credit rating which would not cause either of the Rating
Agencies to reduce their respective then current ratings of the Certificates (or
having provided such security from time to time as is sufficient to avoid such
reduction). If such corporation or association publishes reports of condition at
least annually, pursuant to law or to the requirements of the aforesaid
supervising or examining authority, then for the purposes of this Section 8.06
the combined capital and surplus of such corporation or association shall be
deemed to be its combined capital and surplus as set forth in its most recent
report of condition so published. In case at any time either the Trustee or the
Trust Administrator shall cease to be eligible in accordance with the provisions
of this Section 8.06, the Trustee or the Trust Administrator, as applicable,
shall resign immediately in the manner and with the effect specified in Section
8.07 hereof. The entity serving as Trustee may have normal banking and trust
relationships with the Depositor and its affiliates or the Servicer and its
affiliates; provided, however, that such entity cannot be an affiliate of the
Servicer.
Section 8.07. Resignation and Removal of Trustee or the Trust
Administrator.
----------------------------------------------
Each of the Trustee or the Trust Administrator may at any time
resign and be discharged from the trusts hereby created by giving written notice
of resignation to the Depositor and the Servicer and each Rating Agency not less
than 60 days before the date specified in such notice when, subject to Section
8.08, such resignation is to take effect, and acceptance by a successor trustee
or successor trust administrator in accordance with Section 8.08 meeting the
qualifications set forth in Section 8.06. If no successor trustee or successor
trust administrator meeting such qualifications shall have been so appointed and
have accepted appointment within 30 days after the giving of such notice or
resignation, the resigning Trustee or Trust Administrator may petition any court
of competent jurisdiction for the appointment of a successor trustee or
successor trust administrator.
If at any time either the Trustee or the Trust Administrator shall
cease to be eligible in accordance with the provisions of Section 8.06 hereof
and shall fail to resign after written request thereto by the Depositor, or if
at any time either the Trustee or the Trust Administrator shall become incapable
of acting, or shall be adjudged as bankrupt or insolvent, or a receiver of
either the Trustee, the Trust Administrator or of any of their property shall be
appointed, or any public officer shall take charge or control of either the
Trustee, the Trust Administrator or of any of their property or affairs for the
purpose of rehabilitation, conservation or liquidation, or a tax is imposed with
respect to the Trust Fund by any state in which the Trustee, the Trust
Administrator or the Trust Fund is located and the imposition of such tax would
be avoided by the appointment of a different trustee or trust administrator,
then the Depositor or the Servicer may remove the Trustee or Trust Administrator
and appoint a successor trustee or successor trust administrator by written
instrument, in triplicate, one copy of which instrument shall be delivered to
the Trustee or Trust Administrator, one copy of which shall be delivered to the
Servicer and one copy to the successor trustee.
The Holders of Certificates entitled to at least 51% of the Voting
Rights may at any time remove either the Trustee or the Trust Administrator and
appoint a successor trustee or successor trust 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 trustee or successor trust administrator to the
Servicer, one complete set to the Trustee or the Trust Administrator so removed
and one complete set to the successor so appointed. Notice of any removal of the
Trustee or Trust Administrator shall be given to each Rating Agency by the
successor trustee or successor trust administrator.
Any resignation or removal of the Trustee or Trust Administrator and
appointment of a successor trustee or successor trust administrator pursuant to
any of the provisions of this Section 8.07 shall become effective upon
acceptance of appointment by the successor trustee or successor trust
administrator as provided in Section 8.08 hereof.
Section 8.08. Successor Trustee; Successor Trust Administrator.
------------------------------------------------
Any successor trustee or successor trust administrator appointed as
provided in Section 8.07 hereof shall execute, acknowledge and deliver to the
Depositor and to its predecessor trustee or predecessor trust administrator and
the Servicer an instrument accepting such appointment hereunder and thereupon
the resignation or removal of the predecessor trustee or predecessor trust
administrator shall become effective and such successor trustee or successor
trust 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 Trustee or
Trust Administrator herein. The Depositor, the Servicer and the predecessor
trustee or predecessor trust 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 trustee all such
rights, powers, duties, and obligations.
No successor trustee or successor trust administrator shall accept
appointment as provided in this Section 8.08 unless at the time of such
acceptance such successor trustee or successor trust administrator shall be
eligible under the provisions of Section 8.06 hereof and its appointment shall
not adversely affect the then current rating of the Certificates.
Upon acceptance of appointment by a successor trustee or successor
trust administrator as provided in this Section 8.08, the Depositor shall mail
notice of the succession of such trustee or trust administrator hereunder to all
Holders of Certificates. If the Depositor fails to mail such notice within 10
days after acceptance of appointment by the successor trustee or successor trust
administrator, the successor trustee or successor trust administrator shall
cause such notice to be mailed at the expense of the Depositor.
Section 8.09. Merger or Consolidation of Trustee or Trust
Administrator.
-------------------------------------------
Any corporation or other entity into which the Trustee or Trust
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 Trustee or Trust Administrator shall be a party, or
any corporation or other entity succeeding to the business of the Trustee or
Trust Administrator, shall be the successor of the Trustee or Trust
Administrator hereunder, provided that such corporation or other entity shall be
eligible under the provisions of Section 8.06 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 8.10. Appointment of Co-Trustee or Separate Trustee.
---------------------------------------------
Notwithstanding any other provisions of this Agreement, at any time,
for the purpose of meeting any legal requirements of any jurisdiction in which
any part of the Trust Fund or property securing any Mortgage Note may at the
time be located, the Servicer and the Trustee acting jointly shall have the
power and shall execute and deliver all instruments to appoint one or more
Persons approved by the Trustee to act as co-trustee or co-trustees jointly with
the Trustee, or separate trustee or separate trustees, of all or any part of the
Trust Fund, and to vest in such Person or Persons, in such capacity and for the
benefit of the Certificateholders, such title to the Trust Fund or any part
thereof, whichever is applicable, and, subject to the other provisions of this
Section 8.10, such powers, duties, obligations, rights and trusts as the
Servicer and the Trustee may consider necessary or desirable. If the Servicer
shall not have joined in such appointment within 15 days after the receipt by it
of a request to do so, or in the case a Servicer Event of Termination shall have
occurred and be continuing, the Trustee alone shall have the power to make such
appointment. No co-trustee or separate trustee hereunder shall be required to
meet the terms of eligibility as a successor trustee under Section 8.06 and no
notice to Certificateholders of the appointment of any co-trustee or separate
trustee shall be required under Section 8.08.
Every separate trustee and co-trustee shall, to the extent permitted
by law, be appointed and act subject to the following provisions and conditions:
(i) To the extent necessary to effectuate the purposes of this
Section 8.10, all rights, powers, duties and obligations conferred or
imposed upon the Trustee 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, 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;
(ii) No trustee hereunder shall be held personally liable by reason
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;
(iii) The Trustee may at any time accept the resignation of or
remove any separate trustee or co-trustee; and
(iv) The Servicer, 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
Servicer, the Trust Administrator and the Depositor.
Any separate trustee or co-trustee may, at any time, constitute the
Trustee its agent or attorney-in-fact, with full power and authority, to the
extent not prohibited by law, to do any lawful act under or in respect of this
Agreement on its behalf and in its name. If any separate trustee or co-trustee
shall die, become incapable of acting, resign or be removed, all of its estates,
properties, rights, remedies and trusts shall vest in and be exercised by the
Trustee, to the extent permitted by law, without the appointment of a new or
successor trustee.
Section 8.11. Tax Matters.
-----------
It is intended that the assets with respect to which a REMIC
election 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 Trust Administrator covenants and agrees that it shall act
as agent (and the Trust Administrator is hereby appointed to act as agent) on
behalf of such REMIC and that in such capacity it shall: (a) prepare, submit to
the Trustee for execution and file, or cause to be prepared and filed, in a
timely manner, a U.S. Real Estate Mortgage Investment Conduit Income Tax Return
(Form 1066 or any successor form adopted by the Internal Revenue Service) and
prepare, submit to the Trustee for execution and file or cause to be prepared
and filed with the Internal Revenue Service and applicable state or local tax
authorities income tax or information returns for each taxable year with respect
to such 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 or cause to be furnished to Certificateholders the schedules,
statements or information at such times and in such manner as may be required
thereby, including without limitation, the calculation of any original issue
discount using the Prepayment Assumption; (b) apply for an Employee
Identification Number from the Internal Revenue Service via Form SS-4 or other
acceptable method for such REMIC and within thirty days of the Closing Date,
furnish or cause to be furnished to the Internal Revenue Service, on Forms 8811
or as otherwise may be required by the Code, the name, title, address, and
telephone number of the person that the holders of the Certificates may contact
for tax information relating thereto, together with such additional information
as may be required by such Form, and update such information at the time or
times in the manner required by the Code; (c) make or cause to be made elections
that such assets be treated as a REMIC on the federal tax return for its first
taxable year (and, if necessary, under applicable state law); (d) 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 described in
clauses (i)-(iv) of the definition thereof, or an agent (including a broker,
nominee or other middleman) of a non-Permitted Transferee (the reasonable cost
of computing and furnishing such information may be charged to the Person liable
for such tax); (e) 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 as a REMIC under the REMIC Provisions;
(f) not knowingly or intentionally take any action or omit to take any action
that would cause the termination of the REMIC status; (g) pay, from the sources
specified in the last paragraph of this Section 8.11, the amount of any federal
or state tax, including prohibited transaction taxes as described below, imposed
on such REMIC prior to its termination when and as the same shall be due and
payable (but such obligation shall not prevent the Trust Administrator or any
other appropriate Person from contesting any such tax in appropriate proceedings
and shall not prevent the Trust Administrator from withholding payment of such
tax, if permitted by law, pending the outcome of such proceedings); (h) ensure
that federal, state or local income tax or information returns shall be signed
by the Trust Administrator or such other person as may be required to sign such
returns by the Code or state or local laws, regulations or rules; and (i)
maintain records relating to such REMIC, including but not limited to the
income, expenses, assets and liabilities thereof and the 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. The Holder of the largest Percentage Interest of the Class A-R
Certificates shall act as "tax matters person" for the REMIC within the meaning
of Treasury Regulations Section 1.860F-4(d), and the Trust Administrator is
hereby designated as agent of such Class A-R Certificateholder for such purpose
(or if the Trust Administrator is not so permitted, such Holder shall be the tax
matters person in accordance with the REMIC Provisions). In such capacity, the
Trust Administrator shall, as and when necessary and appropriate, represent the
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 the REMIC, enter into settlement agreements
with any governmental taxing agency, extend any statute of limitations relating
to any tax item of the REMIC, and otherwise act on behalf of the REMIC in
relation to any tax matter or controversy involving it.
In order to enable the Trust Administrator to perform its duties as
set forth herein, the Depositor shall provide, or cause to be provided, to the
Trust Administrator within ten (10) days after the Closing Date all information
or data that the Trust Administrator requests in writing and determines to be
relevant for tax purposes to the valuations and offering prices of the
Certificates, including, without limitation, the price, yield, prepayment
assumption and projected cash flows of the Certificates and the Mortgage Loans.
Thereafter, the Depositor shall provide to the Trust Administrator promptly upon
written request therefor, any such additional information or data that the Trust
Administrator may, from time to time, reasonably request in order to enable the
Trust Administrator to perform its duties as set forth herein. The Depositor
hereby indemnifies the Trust Administrator for any losses, liabilities, damages,
claims or expenses of the Trust Administrator arising from any errors or
miscalculations of the Trust Administrator that result from any failure of the
Depositor to provide, or to cause to be provided, accurate information or data
to the Trust Administrator on a timely basis.
In the event that any tax is imposed on "prohibited transactions" of
the REMIC as defined in Section 860F(a)(2) of the Code, on the "net income from
foreclosure property" of the REMIC as defined in Section 860G(c) of the Code, on
any contribution to the REMIC after the Startup Day pursuant to Section 860G(d)
of the Code, or any other tax is imposed, such tax shall be paid by (i) the
Trustee and the Trust Administrator, respectively, if any such other tax arises
out of or results from a breach by the Trustee and the Trust Administrator,
respectively, of any of its obligations under this Agreement, (ii) the Servicer,
in the case of any such minimum tax, or if such tax arises out of or results
from a breach by the Servicer or the Originator of any of their obligations
under this Agreement, (iii) the Originator, if any such tax arises out of or
results from the Originator's obligation to repurchase a Mortgage Loan pursuant
to Section 2.02 or 2.03 or (iv) in all other cases, or in the event that the
Trustee, the Trust Administrator, the Servicer or the Originator fails to honor
its obligations under the preceding clauses (i), (ii) or (iii), any such tax
will be paid with amounts otherwise to be distributed to the Certificateholders,
as provided in Section 3.08(b).
Section 8.12. Periodic Filings.
----------------
Within 15 days after each Distribution Date, the Trust Administrator
shall, in accordance with industry standards, file with the Commission via the
Electronic Data Gathering and Retrieval System (▇▇▇▇▇), a Form 8-K with a copy
of the Monthly Statement for such Distribution Date as an exhibit thereto. Prior
to January 30, 2002, the Trust Administrator shall, in accordance with industry
standards, file a Form 15 Suspension Notification with respect to the Trust
Fund, if applicable. Prior to March 30, 2002, the Trust Administrator shall file
a Form 10-K, in substance conforming to industry standards, with respect to the
Trust Fund. The Depositor hereby grants to the Trust Administrator a limited
power of attorney to execute and file each such document on behalf of the
Depositor. Such power of attorney shall continue until either the earlier of (i)
receipt by the Trust Administrator from the Depositor of written termination of
such power of attorney and (ii) the termination of the Trust Fund. Each of the
Depositor and Servicer agrees to promptly furnish to the Trust Administrator,
from time to time upon request, such further information, reports, and financial
statements within its control related to this Agreement and the Mortgage Loans
as the Trust Administrator reasonably deems appropriate to prepare and file all
necessary reports with the Commission. The Trust Administrator shall have no
responsibility to file any items other than those specified in this section.
ARTICLE IX
TERMINATION
Section 9.01. Termination upon Liquidation or Purchase of All
Mortgage Loans.
--------------------------------------------------
Subject to Section 9.03, the obligations and responsibilities of the
Depositor, the Servicer, the Trust Administrator and the Trustee created hereby
with respect to the Trust Fund shall terminate upon the earlier of (a) the
purchase by the Servicer of all Mortgage Loans (and REO Properties) remaining in
the Trust Fund at the price equal to the sum of (i) 100% of the Scheduled
Principal Balance of each Mortgage Loan (other than Mortgage Loans for which the
related Mortgaged Property has become REO Property) plus one month's accrued
interest thereon at the applicable Adjusted Mortgage Rate and (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 Servicer at
the expense of the Servicer and (y) the Scheduled Principal Balance of each
Mortgage Loan related to any REO Property plus accrued and unpaid interest
thereon at the applicable Adjusted Mortgage Rate 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 earlier of (i) 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 and (ii) the Latest Possible Maturity Date. The right to
purchase all Mortgage Loans and REO Properties pursuant to clause (a) above
shall be conditioned upon the Pool Principal Balance, at the time of any such
repurchase, aggregating less than ten percent of the aggregate Cut-off Date
Principal Balance of the Mortgage Loans.
Section 9.02. Final Distribution on the Certificates.
--------------------------------------
If on any Determination Date, the Servicer determines 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 Servicer shall direct the
Trustee promptly to send a final distribution notice to each Certificateholder.
If the Servicer elects to terminate the Trust Fund pursuant to clause (a) of
Section 9.01, at least 20 days prior to the date notice is to be mailed to the
affected Certificateholders, the Servicer shall notify the Depositor, the Trust
Administrator and the Trustee of the date the Servicer intends to terminate the
Trust Fund and of the applicable repurchase price of the Mortgage Loans and REO
Properties.
Notice of any termination of the Trust Fund, specifying the
Distribution Date on which Certificateholders may surrender their Certificates
for payment of the final distribution and cancellation, shall be given promptly
by the Trustee by letter to Certificateholders mailed not earlier than the 15th
day and no later than the 10th day of the month next preceding the month of such
final distribution. Any such notice shall specify (a) the Distribution Date upon
which final distribution on the Certificates will be made upon presentation and
surrender of Certificates at the office therein designated, (b) the amount of
such final distribution, (c) the location of the office or agency at which such
presentation and surrender must be made, and (d) that the Record Date otherwise
applicable to such Distribution Date is not applicable, distributions being made
only upon presentation and surrender of the Certificates at the office therein
specified. The Servicer will give such notice to each Rating Agency at the time
such notice is given to Certificateholders.
Upon presentation and surrender of the Certificates, the Trustee
shall cause to be distributed to the Certificateholders of each Class, in the
order set forth in Section 4.02 hereof, on the final Distribution Date, in
proportion to their respective Percentage Interests, with respect to
Certificateholders of the same Class, an amount equal to (i) as to each Class of
Regular Certificates, the Certificate Principal Balance thereof plus accrued
interest thereon and (ii) as to the Residual Certificates, the amount, if any,
which remains on deposit in the Distribution Account (other than the amounts
retained to meet claims) after application pursuant to clause (i) above.
In the event that any affected Certificateholders shall not
surrender Certificates for cancellation within six months after the date
specified in the above mentioned written notice, the Trustee shall give a second
written notice to the remaining Certificateholders to surrender their
Certificates for cancellation and receive the final distribution with respect
thereto. If within six months after the second notice all the applicable
Certificates shall not have been surrendered for cancellation, the Trustee may
take reasonable steps, or may appoint an agent to take reasonable 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 year after the
second notice all Certificates shall not have been surrendered for cancellation,
the Class A-R Certificateholders shall be entitled to all unclaimed funds and
other assets of the Trust Fund which remain subject hereto.
Section 9.03. Additional Termination Requirements.
-----------------------------------
(a) In the event the Servicer exercises its purchase option as
provided in Section 9.01, the Trust Fund shall be terminated in accordance with
the following additional requirements, unless the Trustee and the Trust
Administrator has been supplied with an Opinion of Counsel, at the expense of
the Servicer, to the effect that the failure to comply with the requirements of
this Section 9.03 will not (i) result in the imposition of taxes on "prohibited
transactions" on any REMIC as defined in section 860F of the Code, or (ii) cause
any REMIC to fail to qualify as a REMIC at any time that any Certificates are
outstanding:
(i) The notice given by the Servicer under Section 9.02 shall
provide that such notice constitutes the adoption of a plan of complete
liquidation of the REMIC as of the date of such notice (or, if earlier,
the date on which the first such notice is mailed to Certificateholders).
The Trust Administrator shall also specify such date in a statement
attached to the final tax return of the REMIC; and
(ii) At or after the time of adoption of such a plan of complete
liquidation and at or prior to the final Distribution Date, the Trustee
shall sell all of the assets of the Trust Estate to the Originator for
cash at the purchase price specified in Section 9.01 and shall distribute
such cash within 90 days of such adoption in the manner specified in
Section 9.01.
ARTICLE X
MISCELLANEOUS PROVISIONS
Section 10.01. Amendment.
---------
This Agreement may be amended from time to time by the Depositor,
the Servicer, the Trustee and the Trust Administrator without the consent of any
of the Certificateholders (i) to cure any ambiguity or mistake, (ii) to correct
any defective provision herein or to supplement any provision herein which may
be inconsistent with any other provision herein, (iii) to add to the duties of
the Depositor, the Loan Seller, the Originator or the Servicer, (iv) to add any
other provisions with respect to matters or questions arising hereunder or (v)
to modify, alter, amend, add to or rescind any of the terms or provisions
contained in this Agreement; provided that any action pursuant to clauses (iv)
or (v) above shall not, as evidenced by an Opinion of Counsel (which Opinion of
Counsel shall be an expense of the party requesting the amendment or if the
Trustee or Trust Administrator requests the amendment, the Trust Fund),
adversely affect in any material respect the interests of any Certificateholder;
provided, however, that the amendment shall not be deemed to adversely affect in
any material respect the interests of the Certificate holders if the Person
requesting the amendment obtains a letter from each Rating Agency stating that
the amendment would not result in the downgrading or withdrawal of the
respective ratings then assigned to the Certificates; it being understood and
agreed that any such letter in and of itself will not represent a determination
as to the materiality of any such amendment and will represent a determination
only as to the credit issues affecting any such rating. The Trustee, the Trust
Administrator, the Depositor and the Servicer also may at any time and from time
to time amend this Agreement 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 any REMIC as a REMIC
under the Code, (ii) avoid or minimize the risk of the imposition of any tax on
any 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 Trust Administrator has been
provided an Opinion of Counsel, which opinion shall be an expense of the party
requesting such opinion but in any case shall not be an expense of the Trustee,
the Trust Administrator 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 Servicer, the Trust Administrator and the Trustee with the
consent of the Holders of a Majority in Interest 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 the preceding clause (i), without the consent of the Holders of
Certificates of such Class evidencing, as to such Class, Percentage Interests
aggregating 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, neither
the Trustee nor the Trust Administrator shall consent to any amendment to this
Agreement unless it shall have first received an Opinion of Counsel, which
opinion shall not be an expense of the Trustee, the Trust Administrator or the
Trust Fund, to the effect that such amendment will not cause the imposition of
any tax on any REMIC or the Certificateholders or cause any REMIC to fail to
qualify as a REMIC at any time that any Certificates are outstanding.
Promptly after the execution of any amendment to this Agreement
requiring the consent of Certificateholders, the Trustee shall furnish written
notification of the substance or a copy of such amendment to each
Certificateholder and each Rating Agency.
It shall not be necessary for the consent of Certificateholders
under this Section 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 or the Trust
Administrator to enter into an amendment without receiving an Opinion of Counsel
(which Opinion shall not be an expense of the Trustee or the Trust Administrator
or the Trust Fund, satisfactory to the Trust Administrator and the Trustee that
(i) such amendment is permitted and is not prohibited by this Agreement and that
all requirements for amending this Agreement have been complied with; and (ii)
either (A) the amendment does not adversely affect in any material respect the
interests of any Certificateholder or (B) the conclusion set forth in the
immediately preceding clause (A) is not required to be reached pursuant to this
Section 10.01.
Section 10.02. Recordation of Agreement; Counterparts.
--------------------------------------
This Agreement (or an abstract hereof, if acceptable to the
applicable recording office) is subject to recordation in all appropriate public
offices for real property records in all the towns or other comparable
jurisdictions in which any or all of the Mortgaged Properties are situated, and
in any other appropriate public office or elsewhere, such recordation to be
effected by the Servicer and at its expense on direction by the Trust
Administrator (acting at the written direction of a Majority in Interest of the
Certificateholders), but only upon direction accompanied by an Opinion of
Counsel to the effect that such recordation materially and beneficially affects
the interests of the Certificateholders.
For the purpose of facilitating the recordation of this Agreement as
herein provided and for other purposes, this Agreement may be executed
simultaneously in any number of counterparts, each of which counterparts shall
be deemed to be an original, and such counterparts shall constitute but one and
the same instrument.
Section 10.03. Governing Law.
-------------
THIS AGREEMENT SHALL BE CONSTRUED IN ACCORDANCE WITH AND GOVERNED BY
THE SUBSTANTIVE LAWS OF THE STATE OF NEW YORK APPLICABLE TO AGREEMENTS MADE AND
TO BE PERFORMED IN THE STATE OF NEW YORK AND THE OBLIGATIONS, RIGHTS AND
REMEDIES OF THE PARTIES HERETO AND THE CERTIFICATEHOLDERS SHALL BE DETERMINED IN
ACCORDANCE WITH SUCH LAWS.
Section 10.04. Intention of Parties.
--------------------
It is the express intent of the parties hereto that the conveyance
of the Trust Fund by the Depositor to the Trustee be, and be construed as, an
absolute sale thereof to the Trustee. It is, further, not the intention of the
parties that such conveyance be deemed a pledge thereof by the Depositor to the
Trustee. 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 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 conveyance 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 that constitute
the Trust Fund, 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
Certificateholder.
Section 10.05. Notices.
-------
(a) The Trustee shall use its best efforts to promptly provide
notice to each Rating Agency with respect to each of the following of which it
has actual knowledge:
1. Any material change or amendment to this Agreement;
2. The occurrence of any Servicer Event of Termination that
has not been cured;
3. The resignation or termination of the Servicer, the Trust
Administrator or the Trustee and the appointment of any
successor;
4. The repurchase or substitution of Mortgage Loans pursuant
to Section 2.03;
5. The final payment to Certificateholders; and
6. Any notice of a purchase of a Mortgage Loan pursuant to
Section 2.02 or 2.03.
In addition, the Trust Administrator shall promptly furnish to each
Rating Agency copies of the following:
1. Each annual statement as to compliance described in Section
3.16; and
2. Each annual independent public accountants' servicing report
described in Section 3.17.
(b) All directions, demands and notices hereunder shall be in
writing and shall be deemed to have been duly given when delivered to (a) in the
case of the Depositor, Mortgage Asset Securitization Transactions, Inc., ▇▇▇▇
▇▇▇▇▇▇ ▇▇ ▇▇▇ ▇▇▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇, Attention: ▇▇▇▇ ▇▇▇▇▇▇, Esq.,
(b) in the case of the Trust Administrator, its Corporate Trust Office, or such
other address as the Trust Administrator may hereafter furnish to the Depositor
or Servicer, (c) in the case of the Originator and Servicer, ▇▇▇▇▇ Fargo Home
Mortgage, Inc., ▇ ▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇ ▇▇▇▇▇-▇▇▇▇, Attention: General
Counsel MAC X2401-06T, (e) in the case of the Trustee, The Chase Manhattan Bank,
▇▇▇ ▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇ ▇▇▇▇▇, ▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇, Attention:
Institutional Trust Services/Structured Finance, and (f) in the case of the
Rating Agencies, the address specified therefor in the definition corresponding
to the name of such Rating Agency. Notices to Certificateholders shall be deemed
given when mailed, first class postage prepaid, to their respective addresses
appearing in the Certificate Register.
Section 10.06. Severability of Provisions.
--------------------------
If any one or more of the covenants, agreements, provisions or terms
of this Agreement shall be for any reason whatsoever held invalid, then such
covenants, agreements, provisions or terms shall be deemed severable from the
remaining covenants, agreements, provisions or terms of this Agreement and shall
in no way affect the validity or enforceability of the other provisions of this
Agreement or of the Certificates or the rights of the Holders thereof.
Section 10.07. Assignment.
----------
Notwithstanding anything to the contrary contained herein, except as
provided in Section 6.02 and this Section 10.07, this Agreement may not be
assigned by the Servicer without the prior written consent of the Trustee, the
Trust Administrator and Depositor. The Servicer shall be permitted to pledge its
rights as servicer hereunder to a lender provided that no such pledge shall
permit the termination of the Servicer as Servicer unless a successor servicer
meeting the requirements of Section 6.04 and 7.02 hereunder shall have assumed
the rights and obligations of the Servicer hereunder.
Section 10.08. Limitation on Rights of Certificateholders.
------------------------------------------
The death or incapacity of any Certificateholder shall not operate
to terminate this Agreement or the trust created hereby, nor entitle such
Certificateholder's legal representative or heirs to claim an accounting or to
take any action or commence any proceeding in any court for a petition or
winding up of the trust created hereby, or otherwise affect the rights,
obligations and liabilities of the parties hereto or any of them.
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 and the Trust
Administrator a written notice of a Servicer Event of Termination 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 Trust Administrator (with a copy to
the Trustee) to institute such action, suit or proceeding in its own name as
Trust Administrator hereunder and shall have offered to the Trust Administrator
such reasonable indemnity as it may require against the costs, expenses, and
liabilities to be incurred therein or thereby, and the Trust Administrator, for
60 days after its receipt of such notice, request and offer of indemnity shall
have neglected or refused to institute any such action, suit or proceeding; it
being understood and intended, and being expressly covenanted by each
Certificateholder with every other Certificateholder and the Trust
Administrator, that no one or more Holders of Certificates shall have any right
in any manner whatever by virtue or by availing itself or themselves of any
provisions of this Agreement to affect, disturb or prejudice the rights of the
Holders of any other of the Certificates, or to obtain or seek to obtain
priority over or preference to any other such Holder or to enforce any right
under this Agreement, except in the manner herein provided and for the common
benefit of all Certificateholders. For the protection and enforcement of the
provisions of this Section 10.08, each and every Certificateholder, the Trustee
and the Trust Administrator shall be entitled to such relief as can be given
either at law or in equity.
Section 10.09. Inspection and Audit Rights.
---------------------------
The Servicer agrees that, on reasonable prior notice, it will permit
and will cause each Subservicer to permit any representative of the Depositor,
the Trustee or the Trust Administrator during the Servicer's normal business
hours, to examine all the books of account, records, reports and other papers of
the Servicer relating to the Mortgage Loans, to make copies and extracts
therefrom, to cause such books to be audited by independent certified public
accountants selected by the Depositor, the Trustee or the Trust Administrator
and to discuss its affairs, finances and accounts relating to the Mortgage Loans
with its officers, employees and independent public accountants (and by this
provision the Servicer hereby authorizes said accountants to discuss with such
representative such affairs, finances and accounts), all at such reasonable
times and as often as may be reasonably requested. Any out-of-pocket expense
incident to the exercise by the Depositor or the Trust Administrator of any
right under this Section 10.09 shall be borne by the party requesting such
inspection; all other such expenses shall be borne by the Servicer or the
related Subservicer. The Trust Administrator shall reimburse the Trustee for any
out-of-pocket expense incident to the exercise by the Trustee of any right under
this Section 10.09.
Section 10.10. Certificates Nonassessable and Fully Paid.
-----------------------------------------
It is the intention of the Depositor that Certificateholders shall
not be personally liable for obligations of the Trust Fund, that the interests
in the Trust Fund represented by the Certificates shall be nonassessable for any
reason whatsoever, and that the Certificates, upon due authentication thereof by
the Trustee pursuant to this Agreement, are and shall be deemed fully paid.
IN WITNESS WHEREOF, the Depositor, the Trustee, the Trust
Administrator, the Originator and the Servicer have caused their names to be
signed hereto by their respective officers thereunto duly authorized as of the
day and year first above written.
MORTGAGE ASSET SECURITIZATION
TRANSACTIONS, INC.,
as Depositor
By:____________________________________
Name:
Title:
By:____________________________________
Name:
Title:
THE CHASE MANHATTAN BANK,
as Trustee
By:____________________________________
Name:
Title:
▇▇▇▇▇ FARGO BANK MINNESOTA, N.A.,
as Trust Administrator
By:____________________________________
Name:
Title:
▇▇▇▇▇ FARGO HOME MORTGAGE, INC.,
as Originator
By:____________________________________
Name:
Title:
▇▇▇▇▇ FARGO HOME MORTGAGE, INC.,
as Servicer
By:____________________________________
Name:
Title:
STATE OF )
) ss.:
COUNTY OF )
On the ____ day of September, 2001 before me, a notary public in and
for said State, personally appeared _________________ known to me to be a
__________________ of Mortgage Asset Securitization Transactions, Inc., one of
the corporations that executed the within instrument, and also known to me to be
the person who executed it on behalf of such corporation, and acknowledged to me
that such corporation executed the within instrument.
IN WITNESS WHEREOF, I have hereunto set my hand and affixed my
official seal the day and year in this certificate first above written.
_________________________________________
Notary Public
STATE OF )
) ss.:
COUNTY OF )
On the ____ day of September, 2001 before me, a notary public in and
for said State, personally appeared _________________ known to me to be a
__________________ of The Chase Manhattan Bank, one of the corporations that
executed the within instrument, and also known to me to be the person who
executed it on behalf of such corporation, and acknowledged to me that such
corporation executed the within instrument.
IN WITNESS WHEREOF, I have hereunto set my hand and affixed my
official seal the day and year in this certificate first above written.
_________________________________________
Notary Public
STATE OF )
) ss.:
COUNTY OF )
On the ____ day of September, 2001 before me, a notary public in and
for said State, personally appeared _________________ known to me to be a
__________________ of ▇▇▇▇▇ Fargo Bank of Minnesota, N.A., one of the
corporations that executed the within instrument, and also known to me to be the
person who executed it on behalf of such corporation, and acknowledged to me
that such corporation executed the within instrument.
IN WITNESS WHEREOF, I have hereunto set my hand and affixed my
official seal the day and year in this certificate first above written.
_________________________________________
Notary Public
STATE OF )
) ss.:
COUNTY OF )
On the ____ day of September, 2001 before me, a notary public in and
for said State, personally appeared _________________ known to me to be a
__________________ of ▇▇▇▇▇ Fargo Home Mortgage, Inc., one of the corporations
that executed the within instrument, and also known to me to be the person who
executed it on behalf of such corporation, and acknowledged to me that such
corporation executed the within instrument.
IN WITNESS WHEREOF, I have hereunto set my hand and affixed my
official seal the day and year in this certificate first above written.
_________________________________________
Notary Public
STATE OF )
) ss.:
COUNTY OF )
On the ____ day of September, 2001 before me, a notary public in and
for said State, personally appeared _________________ known to me to be a
__________________ of ▇▇▇▇▇ Fargo Home Mortgage, Inc., one of the corporations
that executed the within instrument, and also known to me to be the person who
executed it on behalf of such corporation, and acknowledged to me that such
corporation executed the within instrument.
IN WITNESS WHEREOF, I have hereunto set my hand and affixed my
official seal the day and year in this certificate first above written.
_________________________________________
Notary Public
SCHEDULE I
Mortgage Loan Schedule
Available Upon Request From Depositor
Address: UBS Warburg LLC
▇▇▇▇ ▇▇▇▇▇▇ ▇▇ ▇▇▇ ▇▇▇▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇
SCHEDULE II
Mortgage Asset Securitization Transactions, Inc.
Mortgage Pass-Through Certificates
Series 2001-1
Representations and Warranties of the Originator
------------------------------------------------
▇▇▇▇▇ Fargo Home Mortgage, Inc. ("WFHM") hereby makes the
representations and warranties set forth in this Schedule II to the Depositor,
the Trust Administrator and the Trustee, as of the Closing Date, or if so
specified herein, as of the Cut-off Date. Capitalized terms used but not
otherwise defined in this Schedule II shall have the meanings ascribed thereto
in the Pooling and Servicing Agreement (the "Pooling and Servicing Agreement")
relating to the above-referenced Series, among WFHM, as originator and servicer,
Mortgage Asset Securitization Transactions, Inc., as depositor, The Chase
Manhattan Bank, as trustee, and ▇▇▇▇▇ Fargo Bank Minnesota, N.A., as trust
administrator.
(i) Due Organization and Authority.
------------------------------
WFHM is a corporation duly organized, validly existing and in good
standing under the laws of the State of California and has all licenses
necessary to carry on its business as now being conducted and is licensed,
qualified and in good standing in each state where a Mortgaged Property is
located if the laws of such state require licensing or qualification in order to
conduct business of the type conducted by WFHM, and in any event WFHM is in
compliance with the laws of any such state to the extent necessary to ensure the
enforceability of the related Mortgage Loan and the servicing of such Mortgage
Loan in accordance with the terms of the Seller's Warranties and Servicing
Agreement; WFHM had the full corporate power and authority to execute and
deliver the Seller's Warranties and Servicing Agreement and to perform in
accordance therewith; the execution, delivery and performance of the Seller's
Warranties and Servicing Agreement (including all instruments of transfer to be
delivered pursuant to the Seller's Warranties and Servicing Agreement) by WFHM
and the consummation of the transactions contemplated thereby have been duly and
validly authorized; the Seller's Warranties and Servicing Agreement evidences
the valid, binding and enforceable obligation of WFHM; and all requisite
corporate action has been taken by WFHM to make the Seller's Warranties and
Servicing Agreement valid and binding upon WFHM in accordance with its terms;
(ii) Ordinary Course of Business.
---------------------------
The consummation of the transactions contemplated by the Seller's
Warranties and Servicing Agreement are in the ordinary course of business of
WFHM, who is in the business of selling and servicing loans, and the transfer,
assignment and conveyance of the Mortgage Notes and the Mortgages by WFHM
pursuant to the Seller's Warranties and Servicing Agreement was not subject to
the bulk transfer or any similar statutory provisions in effect in any
applicable jurisdiction;
(iii) No Conflicts.
-------------
Neither the execution and delivery of the Seller's Warranties and
Servicing Agreement, the acquisition of the Mortgage Loans by WFHM, the sale of
the Mortgage Loans to the Loan Seller or the transactions contemplated thereby,
nor the fulfillment of or compliance with the terms and conditions of the
Seller's Warranties and Servicing Agreement will conflict with or result in a
breach of any of the terms, articles of incorporation or by-laws or any legal
restriction or any agreement or instrument to which WFHM is now a party or by
which it is bound, or constitute a default or result in the violation of any
law, rule, regulation, order, judgment or decree to which WFHM or its property
is subject, or impair the ability of the Loan Seller to realize on the Mortgage
Loans, or impair the value of the Mortgage Loans;
(iv) Ability to Service.
------------------
WFHM is an approved seller/servicer of conventional residential
mortgage loans for ▇▇▇▇▇▇ Mae or ▇▇▇▇▇▇▇ Mac, with the facilities, procedures,
and experienced personnel necessary for the sound servicing of mortgage loans of
the same type as the Mortgage Loans. WFHM is a mortgagee approved by the
Secretary of Housing and Urban Development pursuant to Section 203 of the
National Housing Act and is in good standing to sell mortgage loans to and
service mortgage loans for ▇▇▇▇▇▇ Mae or ▇▇▇▇▇▇▇ Mac, and no event has occurred,
including but not limited to a change in insurance coverage, which would make
WFHM unable to comply with ▇▇▇▇▇▇ Mae or ▇▇▇▇▇▇▇ Mac eligibility requirements or
which would require notification to either ▇▇▇▇▇▇ Mae or ▇▇▇▇▇▇▇ Mac;
(v) Reasonable Servicing Fee.
------------------------
WFHM acknowledges and agrees that the Servicing Fee represents
reasonable compensation for performing such services and that the entire
Servicing Fee shall be treated by WFHM, for accounting and tax purposes, as
compensation for the servicing and administration of the Mortgage Loans pursuant
to the Seller's Warranties and Servicing Agreement;
(vi) Ability to Perform.
------------------
WFHM does not believe, nor does it have any reason or cause to
believe, that it cannot perform each and every covenant contained in the
Seller's Warranties and Servicing Agreement. WFHM is solvent and the sale of the
Mortgage Loans will not cause WFHM to become insolvent. The sale of the Mortgage
Loans is not undertaken to hinder, delay or defraud any of WFHM's creditors;
(vii) No Litigation Pending.
---------------------
There is no action, suit, proceeding or investigation pending or
threatened against WFHM which, either in any one instance or in the aggregate,
may result in any material adverse change in the business, operations, financial
condition, properties or assets of WFHM, or in any material impairment of the
right or ability of WFHM to carry on its business substantially as now
conducted, or in any material liability on the part of WFHM, or which would draw
into question the validity of the Seller's Warranties and Servicing Agreement or
the Mortgage Loans or of any action taken or to be contemplated therein, or
which would be likely to impair materially the ability of WFHM to perform under
the terms of the Seller's Warranties and Servicing Agreement;
(viii) No Consent Required.
-------------------
No consent, approval, authorization or order of any court or
governmental agency or body is required for the execution, delivery and
performance by WFHM of or compliance by WFHM with the Seller's Warranties and
Servicing Agreement or the sale of the Mortgage Loans as evidenced by the
consummation of the transactions contemplated by the Seller's Warranties and
Servicing Agreement, or if required, such approval has been obtained prior to
September 10, 2001;
(ix) Selection Process.
-----------------
The Mortgage Loans were selected from among the outstanding
three-year fixed / one-year adjustable rate one- to four-family mortgage loans
in WFHM's portfolio on September 10, 2001 as to which the representations and
warranties set forth in the Seller's Warranties and Servicing Agreement could be
made and such selection was not made in a manner so as to affect adversely the
interests of the Loan Seller;
(x) No Untrue Information.
---------------------
Neither the Seller's Warranties and Servicing Agreement nor any
statement, report or other document furnished or to be furnished pursuant to the
Seller's Warranties and Servicing Agreement or in connection with the
transactions contemplated hereby contains any untrue statement of fact or omits
to state a fact necessary to make the statements contained therein not
misleading;
(xi) Sale Treatment.
--------------
WFHM has determined that the disposition of the Mortgage Loans
pursuant to the Seller's Warranties and Servicing Agreement will be afforded
sale treatment for accounting and tax purposes;
(xii) No Material Change.
------------------
There has been no material adverse change in the business,
operations, financial condition or assets of WFHM since the date of WFHM's most
recent financial statements; and
(xiii) No Brokers' Fees.
----------------
WFHM has not dealt with any broker, investment banker, agent or
other Person that may be entitled to any commission or compensation in the
connection with the sale of the Mortgage Loans.
SCHEDULE III
Mortgage Asset Securitization Transactions, Inc.
Mortgage Pass-Through Certificates
Series 2001-1
Representations and Warranties as to the Mortgage Loans
-------------------------------------------------------
▇▇▇▇▇ Fargo Home Mortgage, Inc. (the "Originator") hereby makes with
respect to those Mortgage Loans sold by it to the Loan Seller pursuant to the
Seller's Warranties and Servicing Agreement, the representations and warranties
set forth in this Schedule III to the Depositor, the Trust Administrator and the
Trustee, as of September 10, 2001, or if so specified herein, as of the Cut-off
Date. Capitalized terms used but not otherwise defined in this Schedule III
shall have the meanings ascribed thereto in the Pooling and Servicing Agreement
(the "Pooling and Servicing Agreement") relating to the above-referenced Series,
among the Originator, as originator and servicer, Mortgage Asset Securitization
Transactions, Inc., as depositor, The Chase Manhattan Bank, as trustee, and
▇▇▇▇▇ Fargo Bank Minnesota, N.A., as trust administrator.
(i) Mortgage Loans as Described.
---------------------------
The information set forth in the Mortgage Loan Schedule attached
hereto as Exhibit A to the Seller's Warranties and Servicing Agreement and the
information contained on the electronic data file delivered to the Loan Seller
is true and correct;
(ii) Payments Current.
----------------
All payments required to be made up to the Cut-off Date for the
Mortgage Loan under the terms of the Mortgage Note have been made and credited.
No payment under any Mortgage Loan has been 30 days delinquent more than one
time within twelve months prior to September 10, 2001;
(iii) No Outstanding Charges.
----------------------
There are no defaults in complying with the terms of the Mortgages,
and all taxes, governmental assessments, insurance premiums, leasehold payments,
water, sewer and municipal charges, which previously became due and owing have
been paid, or an escrow of funds has been established in an amount sufficient to
pay for every such item which remains unpaid and which has been assessed but is
not yet due and payable. The Originator has not advanced funds, or induced, or
solicited directly or indirectly, the payment of any amount required under the
Mortgage Loan, except for interest accruing from the date of the Mortgage Note
or date of disbursement of the Mortgage Loan proceeds, whichever is later, to
the day which precedes by one month the Due Date of the first installment of
principal and interest;
(iv) Original Terms Unmodified.
-------------------------
The terms of the Mortgage Note and Mortgage have not been impaired,
waived, altered or modified in any respect, except by a written instrument which
has been recorded, if necessary, to protect the interests of the Loan Seller and
which has been delivered to the Loan Seller or its designee. The substance of
any such waiver, alteration or modification has been approved by the issuer of
any related Primary Insurance Policy and the title insurer, to the extent
required by the policy, and its terms are reflected on the Mortgage Loan
Schedule. No Mortgagor has been released, in whole or in part, except in
connection with an assumption agreement approved by the issuer of any related
Primary Insurance Policy and the title insurer, to the extent required by the
policy, and which assumption agreement is part of the Mortgage File delivered to
the Loan Seller or its designee and the terms of which are reflected in the
Mortgage Loan Schedule;
(v) No Defenses.
-----------
The Mortgage Loan is not subject to any right of rescission,
set-off, counterclaim or defense, including without limitation the defense of
usury, nor will the operation of any of the terms of the Mortgage Note or the
Mortgage, or the exercise of any right thereunder, render either the Mortgage
Note or the Mortgage unenforceable, in whole or in part, or subject to any right
of rescission, set-off, counterclaim or defense, including without limitation
the defense of usury, and no such right of rescission, set-off, counterclaim or
defense has been asserted with respect thereto;
(vi) No Satisfaction of Mortgage.
---------------------------
The Mortgage has not been satisfied, canceled, subordinated or
rescinded, in whole or in part, and the Mortgaged Property has not been released
from the lien of the Mortgage, in whole or in part, nor has any instrument been
executed that would effect any such release, cancellation, subordination or
rescission;
(vii) Validity of Mortgage Documents.
------------------------------
The Mortgage Note and the Mortgage and related documents are
genuine, and each is the legal, valid and binding obligation of the maker
thereof enforceable in accordance with its terms. All parties to the Mortgage
Note and the Mortgage had legal capacity to enter into the Mortgage Loan and to
execute and deliver the Mortgage Note and the Mortgage, and the Mortgage Note
and the Mortgage have been duly and properly executed by such parties;
(viii) No Fraud.
--------
No error, omission, misrepresentation, negligence, fraud or similar
occurrence with respect to a Mortgage Loan has taken place on the part of the
Originator, or the Mortgagor, or to the best of the Originator's knowledge, any
appraiser, any builder, or any developer, or any other party involved in the
origination of the Mortgage Loan or in the application of any insurance in
relation to such Mortgage Loan;
(ix) Compliance with Applicable Laws.
-------------------------------
Any and all requirements of any federal, state or local law
including, without limitation, usury, truth-in-lending, real estate settlement
procedures, consumer credit protection, equal credit opportunity or disclosure
laws applicable to the Mortgage Loan have been complied with. All inspections,
licenses and certificates required to be made or issued with respect to all
occupied portions of the Mortgaged Property and, with respect to the use and
occupancy of the same, including, but not limited to, certificates of occupancy
and fire underwriting certificates, have been made or obtained from the
appropriate authorities;
(x) Location and Type of Mortgaged Property.
---------------------------------------
The Mortgaged Property is located in the state identified in the
Mortgage Loan Schedule and consists of a contiguous parcel of real property with
a detached single family residence erected thereon, or a two- to four-family
dwelling, or an individual condominium unit in a condominium project, or an
individual unit in a planned unit development or a townhouse; provided, however,
that any condominium project or planned unit development shall conform with the
applicable ▇▇▇▇▇▇ Mae requirements regarding such dwellings, and no residence or
dwelling is a mobile home or a manufactured dwelling. As of the respective
appraisal date for each Mortgaged Property, no portion of the Mortgaged Property
was being used for commercial purposes. If the Mortgaged Property is a
condominium unit or a planned unit development (other than a de minimus planned
unit development) such condominium or planned unit development project meets
▇▇▇▇▇▇ ▇▇▇ eligibility requirements or is located in a condominium or planned
unit development project which has received ▇▇▇▇▇▇ Mae project approval and the
representations and warranties required by ▇▇▇▇▇▇ ▇▇▇ with respect to such
condominium or planned unit development have been made and remain true and
correct in all respects;
(xi) Valid First Lien.
----------------
The Mortgage is a valid, subsisting and enforceable first lien on
the Mortgaged Property, including all buildings on the Mortgaged Property and
all installations and mechanical, electrical, plumbing, heating and air
conditioning systems located in or annexed to such buildings, and all additions,
alterations and replacements made at any time with respect to the foregoing. The
lien of the Mortgage is subject only to:
(1) the lien of current real property taxes and assessments not yet
due and payable;
(2) covenants, conditions and restrictions, rights of way, easements
and other matters of the public record as of the date of recording
acceptable to mortgage lending institutions generally and specifically
referred to in the lender's title insurance policy delivered to the
originator of the Mortgage Loan and (i) referred to or otherwise
considered in the appraisal made for the originator of the Mortgage Loan
and (ii) which do not adversely affect the Appraised Value of the
Mortgaged Property set forth in such appraisal; and
(3) other matters to which like properties are commonly subject
which do not materially interfere with the benefits of the security
intended to be provided by the mortgage or the use, enjoyment, value or
marketability of the related Mortgaged Property.
Any security agreement, chattel mortgage or equivalent document
related to and delivered in connection with the Mortgage Loan establishes and
creates a valid, subsisting and enforceable first lien and first priority
security interest on the property described therein and the Originator has full
right to sell and assign the same to the Loan Seller;
(xii) Full Disbursement of Proceeds.
-----------------------------
The proceeds of the Mortgage Loan have been fully disbursed, except
for escrows established or created due to seasonal weather conditions, and there
is no requirement for future advances thereunder. All costs, fees and expenses
incurred in making or closing the Mortgage Loan and the recording of the
Mortgage were paid, and the Mortgagor is not entitled to any refund of any
amounts paid or due under the Mortgage Note or Mortgage;
(xiii) Consolidation of Future Advances.
--------------------------------
Any future advances made prior to the Cut-off Date have been
consolidated with the outstanding principal amount secured by the Mortgage, and
the secured principal amount, as consolidated, bears a single interest rate and
single repayment term reflected on the Mortgage Loan Schedule. The lien of the
Mortgage securing the consolidated principal amount is expressly insured as
having first lien priority by a title insurance policy, an endorsement to the
policy insuring the mortgagee's consolidated interest or by other title evidence
acceptable to ▇▇▇▇▇▇ Mae or ▇▇▇▇▇▇▇ Mac; the consolidated principal amount does
not exceed the original principal amount of the Mortgage Loan; the Seller shall
not make future advances after the Cut-off Date;
(xiv) Ownership.
--------
WFHM is the sole owner of record and holder of the Mortgage Loan and
the related Mortgage Note and the Mortgage are not assigned or pledged, and WFHM
has good and marketable title thereto and has full right and authority to
transfer and sell the Mortgage Loan to the Loan Seller. WFHM is transferring the
Mortgage Loan free and clear of any and all encumbrances, liens, pledges,
equities, participation interests, claims, charges or security interests of any
nature encumbering such Mortgage Loan;
(xv) Origination/Doing Business.
--------------------------
The Mortgage Loan was originated by a savings and loan association,
a savings bank, a commercial bank, a credit union, an insurance company, or
similar institution which is supervised and examined by a federal or state
authority or by a mortgagee approved by the Secretary of Housing and Urban
Development pursuant to Sections 203 and 211 of the National Housing Act. All
parties which have had any interest in the Mortgage Loan, whether as mortgagee,
assignee, pledgee or otherwise, are (or, during the period in which they held
and disposed of such interest, were) (1) in compliance with any and all
applicable licensing requirements of the laws of the state wherein the Mortgaged
Property is located, and (2) organized under the laws of such state, or (3)
qualified to do business in such state, or (4) federal savings and loan
associations or national banks having principal offices in such state, or (5)
not doing business in such state;
(xvi) LTV, Primary Insurance Policy.
-----------------------------
No Mortgage Loan has a LTV greater than 95%. The original LTV of the
Mortgage Loan either was not more than 80% or if the Mortgage Loan was
originated prior to July 29, 1999, the excess over 78% is and will be insured as
to payment defaults by a Primary Insurance Policy until the LTV of such Mortgage
Loan is reduced to 80%. If a Mortgage Loan was originated on or after July 29,
1999, and the original LTV is 80% or greater, the excess over 78% is and will be
insured as to payment defaults by a Primary Insurance Policy until terminated
pursuant to the Homeowners Protection Act of 1998, 12 USC ss.4901, et seq. All
provisions of such Primary Insurance Policy have beeN and are being complied
with, such policy is in full force and effect, and all premiums due thereunder
have been paid. The Qualified Insurer has a claims paying ability acceptable to
▇▇▇▇▇▇ Mae or ▇▇▇▇▇▇▇ Mac. Any Mortgage Loan subject to a Primary Insurance
Policy obligates the Mortgagor thereunder to maintain the Primary Insurance
Policy and to pay all premiums and charges in connection therewith. The Mortgage
Rate for the Mortgage Loan as set forth on the Mortgage Loan Schedule is net of
any such insurance premium. Neither the Originator, nor any prior holder of the
Mortgage Loan, has done by act or omission, anything which would impair the
coverage of such Primary Insurance Policy;
(xvii) Title Insurance.
---------------
The Mortgage Loan is covered by an ALTA lender's title insurance
policy (or in the case of any Mortgage Loan secured by a Mortgaged Property
located in a jurisdiction where such policies are generally not available, an
opinion of counsel of the type customarily rendered in such jurisdiction in lieu
of title insurance) or other generally acceptable form of policy of insurance
acceptable to ▇▇▇▇▇▇ ▇▇▇ or ▇▇▇▇▇▇▇ Mac, issued by a title insurer acceptable to
▇▇▇▇▇▇ Mae or ▇▇▇▇▇▇▇ Mac and qualified to do business in the jurisdiction where
the Mortgaged Property is located, insuring the Originator, its successors and
assigns, as to the first priority lien of the Mortgage in the original principal
amount of the Mortgage Loan, subject only to the exceptions contained in clauses
(1), (2) and (3) of Paragraph (xiii) of this Section 3.02, and against any loss
by reason of the invalidity or unenforceability of the lien resulting from the
provisions of the Mortgage providing for adjustment to the Mortgage Rate and
Monthly Payment. The Originator is the sole insured of such lender's title
insurance policy, and such lender's title insurance policy is in full force and
effect and will be in force and effect upon the consummation of the transactions
contemplated by the Seller's Warranties and Servicing Agreement. No claims have
been made under such lender's title insurance policy, and no prior holder of the
Mortgage, including the Originator, has done, by act or omission, anything which
would impair the coverage of such lender's title insurance policy;
(xviii) No Defaults.
-----------
There is no default, breach, violation or event of acceleration
existing under the Mortgage or the Mortgage Note and no event which, with the
passage of time or with notice and the expiration of any grace or cure period,
would constitute a default, breach, violation or event of acceleration, and
neither the Originator nor its predecessors have waived any default, breach,
violation or event of acceleration;
(xix) No Mechanics' Liens.
-------------------
There are no mechanics' or similar liens or claims which have been
filed for work, labor or material (and no rights are outstanding that under the
law could give rise to such liens) affecting the related Mortgaged Property
which are or may be liens prior to, or equal or coordinate with, the lien of the
related Mortgage which are not insured against by the title insurance policy
referenced in Paragraph (xix) above;
(xx) Location of Improvements; No Encroachments.
------------------------------------------
Except as insured against by the title insurance policy referenced
in Paragraph (xix) above, all improvements which were considered in determining
the Appraised Value of the Mortgaged Property lay wholly within the boundaries
and building restriction lines of the Mortgaged Property and no improvements on
adjoining properties encroach upon the Mortgaged Property. No improvement
located on or being part of the Mortgaged Property is in violation of any
applicable zoning law or regulation;
(xxi) Payment Terms.
-------------
The Mortgage Loans have an original term to maturity of not more
than 30 years, with interest payable in arrears on the first day of each month.
As to each Mortgage Loan on each applicable Adjustment Date, the Mortgage Rate
will be adjusted to equal the sum of the Index plus the applicable Gross Margin,
rounded up or down to the nearest multiple of 0.125% indicated by the Mortgage
Note; provided that the Mortgage Rate will not increase or decrease by more than
the Periodic Interest Rate Cap on any Adjustment Date, and will in no event
exceed the maximum Mortgage Rate or be lower than the minimum Mortgage Rate
listed on the Mortgage Loan Schedule for such Mortgage Loan. Each Mortgage Note
requires a monthly payment which is sufficient, during the period prior to the
first adjustment to the Mortgage Rate, to fully amortize the outstanding
principal balance as of the first day of such period over the then remaining
term of such Mortgage Note and to pay interest at the related Mortgage Rate. As
to each Mortgage Loan, if the related Mortgage Rate changes on an Adjustment
Date, the then outstanding principal balance will be reamortized over the
remaining life of such Mortgage Loan. No Mortgage Loan contains terms or
provisions which would result in negative amortization;
(xxii) Customary Provisions.
--------------------
The Mortgage and related Mortgage Note contain customary and
enforceable provisions such as to render the rights and remedies of the holder
thereof adequate for the realization against the Mortgaged Property of the
benefits of the security provided thereby, including, (i) in the case of a
Mortgage designated as a deed of trust, by trustee's sale, and (ii) otherwise by
judicial foreclosure. There is no homestead or other exemption available to a
Mortgagor which would interfere with the right to sell the Mortgaged Property at
a trustee's sale or the right to foreclose the Mortgage;
(xxiii) Occupancy of the Mortgaged Property.
-----------------------------------
As of the date of origination, the Mortgaged Property was
lawfully occupied under applicable law;
(xxiv) No Additional Collateral.
------------------------
The Mortgage Note is not and has not been secured by any collateral,
pledged account or other security except the lien of the corresponding Mortgage
and the security interest of any applicable security agreement or chattel
mortgage referred to in (xiii) above;
(xxv) Deeds of Trust.
--------------
In the event the Mortgage constitutes a deed of trust, a trustee,
duly qualified under applicable law to serve as such, has been properly
designated and currently so serves and is named in the Mortgage, and no fees or
expenses are or will become payable by the Mortgagee to the trustee under the
deed of trust, except in connection with a trustee's sale after default by the
Mortgagor;
(xxvi) Acceptable Investment.
---------------------
The Originator has no knowledge of any circumstances or conditions
with respect to the Mortgage Loan, the Mortgaged Property, the Mortgagor or the
Mortgagor's credit standing that can reasonably be expected to cause private
institutional investors to regard the Mortgage Loan as an unacceptable
investment, cause the Mortgage Loan to become delinquent, or adversely affect
the value or marketability of the Mortgage Loan;
(xxvii) Transfer of Mortgage Loans.
--------------------------
The Assignment upon the insertion of the name of the assignee and
recording information is in recordable form and is acceptable for recording
under the laws of the jurisdiction in which the Mortgaged Property is located;
(xxviii) Mortgaged Property Undamaged.
----------------------------
The Mortgaged Property is undamaged by waste, fire, earthquake or
earth movement, windstorm, flood, tornado or other casualty so as to affect
adversely the value of the Mortgaged Property as security for the Mortgage Loan
or the use for which the premises were intended;
(xxix) Collection Practices; Escrow Deposits.
-------------------------------------
The origination, servicing and collection practices used with
respect to the Mortgage Loan have been in accordance with Accepted Servicing
Practices, and have been in all material respects legal and proper. With respect
to escrow deposits and Escrow Payments, all such payments are in the possession
of the Originator and there exist no deficiencies in connection therewith for
which customary arrangements for repayment thereof have not been made. All
Escrow Payments have been collected in full compliance with state and federal
law. No escrow deposits or Escrow Payments or other charges or payments due the
Originator have been capitalized under the Mortgage Note;
(xxx) No Condemnation.
---------------
There is no proceeding pending or to the best of the Originator's
knowledge threatened for the total or partial condemnation of the related
Mortgaged Property;
(xxxi) The Appraisal.
-------------
The Mortgage File contains an appraisal of the related Mortgaged
Property by an appraiser who had no interest, direct or indirect, in the
Mortgaged Property or in any loan made on the security thereof; and whose
compensation is not affected by the approval or disapproval of the Mortgage
Loan, and the appraisal and the appraiser both satisfy the applicable
requirements of Title XI of the Financial Institution Reform, Recovery, and
Enforcement Act of 1989 and the regulations promulgated thereunder, all as in
effect on the date the Mortgage Loan was originated;
(xxxii) Insurance.
---------
The Mortgaged Property securing each Mortgage Loan is insured by an
insurer acceptable to ▇▇▇▇▇▇ ▇▇▇ or ▇▇▇▇▇▇▇ Mac against loss by fire and such
hazards as are covered under a standard extended coverage endorsement and such
other hazards as are customary in the area where the Mortgaged Property is
located pursuant to insurance policies conforming to the requirements of Section
4.10, in an amount which is not less than the lesser of 100% of the insurable
value of the Mortgaged Property and the outstanding principal balance of the
Mortgage Loan, but in no event less than the minimum amount necessary to fully
compensate for any damage or loss on a replacement cost basis. If the Mortgaged
Property is a condominium unit, it is included under the coverage afforded by a
blanket policy for the project. If the Mortgaged Property is in an area
identified in the Federal Register by the Federal Emergency Management Agency as
having special flood hazards, a flood insurance policy meeting the requirements
of the current guidelines of the Federal Insurance Administration and ▇▇▇▇▇▇ Mae
or ▇▇▇▇▇▇▇ Mac is in effect with a generally acceptable insurance carrier, in an
amount representing coverage not less than the least of (A) the outstanding
principal balance of the Mortgage Loan, (B) the full insurable value and (C) the
maximum amount of insurance which was available under the Flood Disaster
Protection Act of 1973, as amended. All individual insurance policies contain a
standard mortgagee clause naming the Originator and its successors and assigns
as mortgagee, and all premiums thereon have been paid. The Mortgage obligates
the Mortgagor thereunder to maintain a hazard insurance policy at the
Mortgagor's cost and expense, and on the Mortgagor's failure to do so,
authorizes the holder of the Mortgage to obtain and maintain such insurance at
such Mortgagor's cost and expense, and to seek reimbursement therefor from the
Mortgagor. The hazard insurance policy is the valid and binding obligation of
the insurer, is in full force and effect, and will be in full force and effect
and inure to the benefit of the Loan Seller upon the consummation of the
transactions contemplated by this Agreement. The Originator has not acted or
failed to act so as to impair the coverage of any such insurance policy or the
validity, binding effect and enforceability thereof;
(xxxiii) Soldiers' and Sailors' Civil Relief Act.
---------------------------------------
The Mortgagor has not notified the Originator, and the Originator
has no knowledge of any relief requested or allowed to the Mortgagor under the
Soldiers' and Sailors' Civil Relief Act of 1940, as amended;
(xxxiv) No Balloon Payments, Graduated Payments or Contingent
Interests.
-----------------------------------------------------
The Mortgage Loan is not a graduated payment mortgage loan and the
Mortgage Loan does not have a shared appreciation or other contingent interest
feature. No Mortgage Loan has a balloon payment feature;
(xxxv) No Construction Loans.
---------------------
No Mortgage Loan was made in connection with (i) the construction or
rehabilitation of a Mortgage Property or (ii) facilitating the trade-in or
exchange of a Mortgaged Property other than a construction-to-permanent loan
which has converted to a permanent Mortgage Loan;
(xxxvi) Underwriting.
------------
Each Mortgage Loan was underwritten in accordance with the
underwriting guidelines of the Originator; and the Mortgage Note and Mortgage
are on forms acceptable to ▇▇▇▇▇▇▇ Mac or ▇▇▇▇▇▇ ▇▇▇;
(xxxvii) Buydown Mortgage Loans.
----------------------
With respect to each Mortgage Loan that is a Buydown Mortgage Loan:
(1) On or before the date of origination of such Mortgage Loan, the
Originator and the Mortgagor, or the Originator, the Mortgagor and the
seller of the Mortgaged Property or a third party entered into a Buydown
Agreement. The Buydown Agreement provides that the seller of the Mortgaged
Property (or third party) shall deliver to the Originator temporary
Buydown Funds in an amount equal to the aggregate undiscounted amount of
payments that, when added to the amount the Mortgagor on such Mortgage
Loan is obligated to pay on each Due Date in accordance with the terms of
the Buydown Agreement, is equal to the full scheduled Monthly Payment due
on such Mortgage Loan. The temporary Buydown Funds enable the Mortgagor to
qualify for the Buydown Mortgage Loan. The effective interest rate of a
Buydown Mortgage Loan if less than the interest rate set forth in the
related Mortgage Note will increase within the Buydown Period as provided
in the related Buydown Agreement so that the effective interest rate will
be equal to the interest rate as set forth in the related Mortgage Note.
The Buydown Mortgage Loan satisfies the requirements of ▇▇▇▇▇▇ Mae
guidelines;
(2) The Mortgage and Mortgage Note reflect the permanent payment
terms rather than the payment terms of the Buydown Agreement. The Buydown
Agreement provides for the payment by the Mortgagor of the full amount of
the Monthly Payment on any Due Date that the Buydown Funds are available.
The Buydown Funds were not used to reduce the original principal balance
of the Mortgage Loan or to increase the Appraised Value of the Mortgage
Property when calculating the Loan-to-Value Ratios for purposes of the
Agreement and, if the Buydown Funds were provided by the Originator and if
required under ▇▇▇▇▇▇ ▇▇▇ and ▇▇▇▇▇▇▇ Mac guidelines, the terms of the
Buydown Agreement were disclosed to the appraiser of the Mortgaged
Property;
(3) The Buydown Funds may not be refunded to the Mortgagor unless
the Mortgagor makes a principal payment for the outstanding balance of the
Mortgage Loan;
(4) As of the date of origination of the Mortgage Loan, the
provisions of the related Buydown Agreement complied with the requirements
of ▇▇▇▇▇▇ Mae and ▇▇▇▇▇▇▇ Mac regarding buydown agreements.
(xxxviii) Delivery of Mortgage Files.
--------------------------
The Mortgage and any other documents required to be delivered by the
Originator under this Agreement have been delivered to the Loan Seller or its
designee. The Originator is in possession of a complete Mortgage File in
compliance with Exhibit B, except for such documents the originals of which have
been delivered to the Loan Seller or its designee.
(xxxix) No Violation of Environmental Laws.
----------------------------------
There is no pending action or proceeding directly involving any
Mortgaged Property of which the Originator is aware in which compliance with any
environmental law, rule or regulation is an issue; and to the best of the
Originator's knowledge, nothing further remains to be done to satisfy in full
all requirements of each such law, rule or regulation constituting a
prerequisite to use and enjoyment of said property; and
(xl) No Bankruptcy.
-------------
No Mortgagor was a debtor in any state or federal bankruptcy or
insolvency proceeding at the time the Mortgage Loan was originated and to the
best of the Originator's knowledge, as of the Closing Date, the Originator has
not received notice that any Mortgagor is a debtor under any state or federal
bankruptcy or insolvency proceeding.
(xli) Interest Calculation.
--------------------
Interest on each Mortgage Loan is calculated on the basis of a
360-day year consisting of twelve 30-day months;
(xlii) Homeownership and Equity Protection Act.
---------------------------------------
No Mortgage Loan is subject to the provisions of the Home
Ownership and Equity Protection Act of 1994;
(xliii) Texas Refinance Mortgage Loans.
------------------------------
No Mortgage Loan is a "Texas Refinance Loan" pursuant to the
provisions of Article XVI, Section 50(a)(6) of the Texas Constitution, Texas
Civil Statutes and the Texas Finance Code;
(xliv) Conversion to Fixed Interest Rate.
---------------------------------
No adjustable rate Mortgage Loan contains a provision permitting or
requiring conversion to a fixed interest rate Mortgage Loan; and
(xlv) Due on Sale.
-----------
The Mortgage contains an enforceable provision, to the extent
allowed under applicable law, for the acceleration of the payment of the unpaid
principal balance of the Mortgage Loan in the event that the Mortgaged Property
is sold or transferred without the prior written consent of the mortgagee.
EXHIBIT A-1
(FORM OF CLASS A-1 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.
FOR U.S. FEDERAL INCOME TAX PURPOSES, THIS CERTIFICATE IS A "REGULAR
INTEREST" IN A "REAL ESTATE MORTGAGE INVESTMENT CONDUIT," AS THOSE TERMS ARE
DEFINED, RESPECTIVELY, IN SECTIONS 860G AND 860D OF THE INTERNAL REVENUE CODE OF
1986, AS AMENDED (THE "CODE").
Certificate No.:
Cut-off Date: September 1, 2001
First Distribution Date: October 25, 2001
Pass-Through Rate: Floating in
accordance with
the Agreement
Initial Certificate Principal Balance of this Certificate
("Denomination"): $
Initial Certificate Principal Balances of all Certificates of
this Class: $212,957,000
CUSIP: 576433 AA 4
MORTGAGE ASSET SECURITIZATION TRANSACTIONS, INC.
MASTR ADJUSTABLE RATE MORTGAGES TRUST 2001-1
Mortgage Pass-Through Certificates, Series 2001-1
Class A-1
evidencing a percentage interest in the distributions allocable to
the Certificates of the above-referenced Class with respect to a
Trust Fund consisting primarily of a pool of conventional mortgage
loans (the "Mortgage Loans") secured by first liens on one- to
four-family residential properties
Mortgage Asset Securitization Transactions, Inc., as Depositor
Principal in respect of this Certificate is distributable monthly as
set forth herein. Accordingly, the Certificate Principal Balance at any time may
be less than the Certificate Principal 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 Servicer 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 evidenced by this Certificate (obtained by dividing the
Denomination of this Certificate by the aggregate initial Class Principal
Balances of all Certificates of the Class to which this Certificate belongs) in
certain monthly distributions with respect to a Trust Fund consisting primarily
of the Mortgage Loans deposited by Mortgage Asset Securitization Transactions,
Inc. (the "Depositor"). The Trust Fund was created pursuant to a Pooling and
Servicing Agreement dated as of the Cut-off Date specified above (the
"Agreement") among the Depositor, ▇▇▇▇▇ Fargo Home Mortgage, Inc., as originator
and servicer (the "Servicer"), ▇▇▇▇▇ Fargo Bank Minnesota, N.A., as trust
administrator (the "Trust Administrator"), and The Chase Manhattan Bank, as
trustee (the "Trustee"). To the extent not defined herein, the capitalized terms
used herein have the meanings assigned in the Agreement. This Certificate is
issued under and is subject to the terms, provisions and conditions of the
Agreement, to which Agreement the Holder of this Certificate by virtue of the
acceptance hereof assents and by which such Holder is bound.
Reference is hereby made to the further provisions of this
Certificate set forth on the reverse hereof, which further provisions shall for
all purposes have the same effect as if set forth at this place.
This Certificate shall not be entitled to any benefit under the
Agreement or be valid for any purpose unless manually countersigned by an
authorized signatory of the Trustee.
IN WITNESS WHEREOF, the Trustee has caused this Certificate to be
duly executed.
Dated: ____________, 200_
THE CHASE MANHATTAN BANK,
as Trustee
By:____________________________________
Countersigned:
By:_______________________________
Authorized Signatory of
THE CHASE MANHATTAN BANK,
as Trustee
EXHIBIT A-R
(FORM OF CLASS A-R CERTIFICATE)
FOR U.S. FEDERAL INCOME TAX PURPOSES, THIS CERTIFICATE IS A
"RESIDUAL INTEREST" IN A "REAL ESTATE MORTGAGE INVESTMENT CONDUIT," AS THOSE
TERMS ARE DEFINED, RESPECTIVELY, IN SECTIONS 860G AND 860D OF THE INTERNAL
REVENUE CODE OF 1986, AS AMENDED (THE "CODE").
NEITHER THIS CERTIFICATE NOR ANY INTEREST HEREIN MAY BE TRANSFERRED
UNLESS THE PROPOSED TRANSFEREE DELIVERS TO THE TRUSTEE A TRANSFER AFFIDAVIT IN
ACCORDANCE WITH THE PROVISIONS OF THE AGREEMENT REFERRED TO HEREIN.
NEITHER THIS CERTIFICATE NOR ANY INTEREST HEREIN MAY BE TRANSFERRED
UNLESS THE TRANSFEREE DELIVERS TO THE TRUSTEE EITHER A REPRESENTATION LETTER TO
THE EFFECT THAT SUCH TRANSFEREE IS NOT AN EMPLOYEE BENEFIT PLAN SUBJECT TO TITLE
I OF THE EMPLOYEE RETIREMENT INCOME SECURITY ACT OF 1974, AS AMENDED, OR 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. NOTWITHSTANDING ANYTHING ELSE TO THE CONTRARY HEREIN, ANY
PURPORTED TRANSFER OF THIS CERTIFICATE TO OR ON BEHALF OF AN EMPLOYEE BENEFIT
PLAN SUBJECT TO ERISA, THE CODE OR SIMILAR LAW SHALL BE VOID AND OF NO EFFECT.
Certificate No.:
Cut-off Date: September 1, 2001
First Distribution Date: October 25, 2001
Pass-Through Rate: Floating in
accordance with
the Agreement
Initial Certificate Principal Balance of this Certificate
("Denomination"): $
Initial Certificate Principal Balances of all Certificates of
this Class: $100
CUSIP: 576433 AB 2
MORTGAGE ASSET SECURITIZATION TRANSACTIONS, INC.
MASTR ADJUSTABLE RATE MORTGAGES TRUST 2001-1
Mortgage Pass-Through Certificates, Series 2001-1 evidencing the
distributions allocable to the Class A-R Certificates with respect to a Trust
Fund consisting primarily of a pool of conventional loans (the "Mortgage
Loans") secured by first liens on one- to four-family residential properties
Mortgage Asset Securitization Transactions, Inc., as Depositor
Principal in respect of this Certificate is distributable monthly as
set forth herein. Accordingly, the Certificate Principal Balance at any time may
be less than the Certificate Principal 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 Servicer, 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 (obtained by dividing the Denomination of this Certificate
by the aggregate initial Class Principal Balances of all Certificates of the
Class to which this Certificate belongs) in certain monthly distributions with
respect to a Trust Fund consisting of the Mortgage Loans deposited by Mortgage
Asset Securitization Transactions, Inc. (the "Depositor"). The Trust Fund was
created pursuant to a Pooling and Servicing Agreement dated as of the Cut-off
Date specified above (the "Agreement") among the Depositor, ▇▇▇▇▇ Fargo Home
Mortgage, Inc., as originator and servicer (the "Servicer"), ▇▇▇▇▇ Fargo Bank
Minnesota, N.A., as trust administrator (the "Trust Administrator"), and The
Chase Manhattan Bank, as trustee (the "Trustee"). To the extent not defined
herein, the capitalized terms used herein have the meanings assigned in the
Agreement. This Certificate is issued under and is subject to the terms,
provisions and conditions of the Agreement, to which Agreement the Holder of
this Certificate by virtue of the acceptance hereof assents and by which such
Holder is bound.
Any distribution of the proceeds of any remaining assets of the
Trust Fund will be made only upon presentment and surrender of this Class A-R
Certificate at the Corporate Trust Office of the Trustee.
No transfer of a Class A-R Certificate shall be made unless the
Trustee shall have received a representation letter from the transferee of such
Certificate, acceptable to and in form and substance satisfactory to the
Trustee, to the effect that such transferee is not an employee benefit plan
subject to Section 406 of ERISA, Section 4975 of the Code or Similar Law, nor a
person acting on behalf of any such plan, which representation letter shall not
be an expense of the Trustee or the Servicer. Notwithstanding anything else to
the contrary herein any purported transfer of a Class A-R Certificate to or on
behalf of an employee benefit plan subject to ERISA, the Code or Similar Law
shall be void and of no effect.
Each Holder of this Class A-R Certificate will be deemed to have
agreed to be bound by the restrictions of the Agreement, including but not
limited to the restrictions that (i) each person holding or acquiring any
Ownership Interest in this Class A-R Certificate must be a Permitted Transferee,
(ii) no Ownership Interest in this Class A-R Certificate may be transferred
without delivery to the Trustee of (a) a transfer affidavit of the proposed
transferee and (b) a transfer certificate of the transferor, each of such
documents to be in the form described in the Agreement, (iii) each person
holding or acquiring any Ownership Interest in this Class A-R Certificate must
agree to require a transfer affidavit and to deliver a transfer certificate to
the Trustee as required pursuant to the Agreement, (iv) each person holding or
acquiring an Ownership Interest in this Class A-R Certificate must agree not to
transfer an Ownership Interest in this Class A-R Certificate if it has actual
knowledge that the proposed transferee is not a Permitted Transferee and (v) any
attempted or purported transfer of any Ownership Interest in this Class A-R
Certificate in violation of such restrictions will be absolutely null and void
and will 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 countersigned by an
authorized signatory of the Trustee.
IN WITNESS WHEREOF, the Trustee has caused this Certificate to be
duly executed.
Dated: ____________, 200_
THE CHASE MANHATTAN BANK,
as Trustee
By:____________________________________
Countersigned:
By:_________________________________
Authorized Signatory of
THE CHASE MANHATTAN BANK,
as Trustee
EXHIBIT B
(FORM OF B-1, B-2 AND B-3 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.
FOR U.S. FEDERAL INCOME TAX PURPOSES, THIS CERTIFICATE IS A "REGULAR
INTEREST" IN A "REAL ESTATE MORTGAGE INVESTMENT CONDUIT," AS THOSE TERMS ARE
DEFINED, RESPECTIVELY, IN SECTIONS 860G AND 860D OF THE INTERNAL REVENUE CODE OF
1986, AS AMENDED (THE "CODE").
THIS CERTIFICATE IS SUBORDINATED IN RIGHT OF PAYMENT TO CERTAIN
CERTIFICATES AS DESCRIBED IN THE AGREEMENT REFERRED TO HEREIN.
Certificate No.:
Cut-off Date: September 1, 2001
First Distribution Date: October 25, 2001
Pass-Through Rate: Floating in
accordance with
the Agreement
Initial Certificate Principal Balance of this Certificate
("Denomination"): $
Initial Certificate Principal Balances of all Certificates of
this Class: $
CUSIP:
MORTGAGE ASSET SECURITIZATION TRANSACTIONS, INC.
MASTR ADJUSTABLE RATE MORTGAGES TRUST 2001-1
Mortgage Pass-Through Certificates, Series 2001-1
Class ( )
evidencing a percentage interest in the distributions allocable to
the Certificates of the above-referenced Class with respect to a
Trust Fund consisting primarily of a pool of conventional loans (the
"Mortgage Loans") secured by first liens on one- to four-family
residential properties
Mortgage Asset Securitization Transactions, Inc., as Depositor
Principal in respect of this Certificate is distributable monthly as
set forth herein. Accordingly, the Certificate Principal Balance at any time may
be less than the Certificate Principal 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 Servicer, 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 evidenced by this Certificate (obtained by dividing the
Denomination of this Certificate by the aggregate initial Class Principal
Balances of all Certificates of the Class to which this Certificate belongs) in
certain monthly distributions with respect to a Trust Fund consisting primarily
of the Mortgage Loans deposited by Mortgage Asset Securitization Transactions,
Inc. (the "Depositor"). The Trust Fund was created pursuant to a Pooling and
Servicing Agreement dated as of the Cut-off Date specified above (the
"Agreement") among the Depositor, ▇▇▇▇▇ Fargo Home Mortgage, Inc., as originator
and servicer (the "Servicer"), ▇▇▇▇▇ Fargo Bank Minnesota, N.A., as trust
administrator (the "Trust Administrator"), and The Chase Manhattan Bank, as
trustee (the "Trustee"). To the extent not defined herein, the capitalized terms
used herein have the meanings assigned in the Agreement. This Certificate is
issued under and is subject to the terms, provisions and conditions of the
Agreement, to which Agreement the Holder of this Certificate by virtue of the
acceptance hereof assents and by which such Holder is bound.
Reference is hereby made to the further provisions of this
Certificate set forth on the reverse hereof, which further provisions shall for
all purposes have the same effect as if set forth at this place.
This Certificate shall not be entitled to any benefit under the
Agreement or be valid for any purpose unless manually countersigned by an
authorized signatory of the Trustee.
IN WITNESS WHEREOF, the Trustee has caused this Certificate to be
duly executed.
Dated: ____________, 200_
THE CHASE MANHATTAN BANK,
as Trustee
By:____________________________________
Countersigned:
By:_________________________________
Authorized Signatory of
THE CHASE MANHATTAN BANK,
as Trustee
EXHIBIT C
(FORM OF PRIVATE CERTIFICATE)
FOR U.S. FEDERAL INCOME TAX PURPOSES, THIS CERTIFICATE IS A "REGULAR
INTEREST" IN A "REAL ESTATE MORTGAGE INVESTMENT CONDUIT," AS THOSE TERMS ARE
DEFINED, RESPECTIVELY, IN SECTIONS 860G AND 860D OF THE INTERNAL REVENUE CODE OF
1986, AS AMENDED (THE "CODE").
THIS CERTIFICATE IS SUBORDINATED IN RIGHT OF PAYMENT TO CERTAIN
CERTIFICATES AS DESCRIBED IN THE AGREEMENT REFERRED TO HEREIN.
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.
THE HOLDER OF THIS CERTIFICATE BY ITS ACCEPTANCE HEREOF AGREES NOT
TO OFFER, SELL OR OTHERWISE TRANSFER SUCH CERTIFICATE EXCEPT IN ACCORDANCE WITH
ALL APPLICABLE STATE SECURITIES LAWS AND (A) PURSUANT TO A REGISTRATION
STATEMENT WHICH HAS BEEN DECLARED EFFECTIVE UNDER THE ACT, (B) FOR SO LONG AS
THIS CERTIFICATE IS ELIGIBLE FOR RESALE PURSUANT TO RULE 144A UNDER THE ACT
("RULE 144A"), TO A PERSON WHO THE SELLER REASONABLY BELIEVES IS A "QUALIFIED
INSTITUTIONAL BUYER" AS DEFINED IN RULE 144A IN A TRANSACTION MEETING THE
REQUIREMENTS OF RULE 144A, (C) TO AN INSTITUTIONAL "ACCREDITED INVESTOR" WITHIN
THE MEANING OF RULE 501 (A)(1), (2), (3) OR (7) OF REGULATION D UNDER THE ACT IN
A TRANSACTION EXEMPT FROM THE REGISTRATION REQUIREMENTS UNDER THE ACT, OR (D)
PURSUANT TO ANOTHER AVAILABLE EXEMPTION FROM THE REGISTRATION REQUIREMENTS OF
THE ACT, SUBJECT IN EACH OF THE FOREGOING CASES TO THE COMPLETION AND DELIVERY
BY THE TRANSFEROR TO THE TRUSTEE OF A CERTIFICATE OF TRANSFER IN THE FORM
APPEARING ON THE LAST PAGE OF THIS CERTIFICATE.
NEITHER THIS CERTIFICATE NOR ANY INTEREST HEREIN MAY BE TRANSFERRED
UNLESS THE TRANSFEREE REPRESENTS TO THE TRUSTEE THAT SUCH TRANSFEREE IS NOT AN
EMPLOYEE BENEFIT PLAN SUBJECT TO TITLE I OF THE EMPLOYEE RETIREMENT INCOME
SECURITY ACT OF 1974, AS AMENDED, OR 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, OR DELIVERS TO THE
TRUSTEE A REPRESENTATION LETTER OR AN OPINION OF COUNSEL IN ACCORDANCE WITH THE
PROVISIONS OF THE AGREEMENT REFERRED TO HEREIN. (SUCH REPRESENTATION SHALL BE
DEEMED TO HAVE BEEN MADE TO THE TRUSTEE BY THE TRANSFEREE'S ACCEPTANCE OF A
CERTIFICATE OF THIS CLASS AND BY A BENEFICIAL OWNER'S ACCEPTANCE OF ITS INTEREST
IN A CERTIFICATE OF THIS CLASS.) NOTWITHSTANDING ANYTHING ELSE TO THE CONTRARY
HEREIN, ANY PURPORTED TRANSFER OF THIS CERTIFICATE TO OR ON BEHALF OF AN
EMPLOYEE BENEFIT PLAN SUBJECT TO ERISA, THE CODE OR SIMILAR LAW WITHOUT THE
OPINION OF COUNSEL SATISFACTORY TO THE TRUSTEE AS DESCRIBED ABOVE SHALL BE VOID
AND OF NO EFFECT.
Certificate No.:
Cut-off Date: September 1, 2001
First Distribution Date: October 25, 2001
Pass-Through Rate: Floating in
accordance with
the Agreement
Initial Certificate Principal Balance of this Certificate
("Denomination"): $
Initial Certificate Principal Balances of all Certificates of
this Class: $
CUSIP:
MORTGAGE ASSET SECURITIZATION TRANSACTIONS, INC.
MASTR ADJUSTABLE RATE MORTGAGES TRUST 2001-1
Mortgage Pass-Through Certificates, Series 2001-1
Class ( )
evidencing a percentage interest in the distributions allocable to
the Certificates of the above-referenced Class with respect to a
Trust Fund consisting primarily of a pool of conventional loans (the
"Mortgage Loans") secured by first liens on one- to four-family
residential properties
Mortgage Asset Securitization Transactions, Inc., as Depositor
Principal in respect of this Certificate is distributable monthly as
set forth herein. Accordingly, the Certificate Principal Balance at any time may
be less than the Certificate Principal 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 Servicer, 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 evidenced by this Certificate (obtained by dividing the
Denomination of this Certificate by the aggregate initial Class Principal
Balances of all Certificates of the Class to which this Certificate belongs) in
certain monthly distributions with respect to a Trust Fund consisting primarily
of the Mortgage Loans deposited by Mortgage Asset Securitization Transactions,
Inc. (the "Depositor"). The Trust Fund was created pursuant to a Pooling and
Servicing Agreement dated as of the Cut-off Date specified above (the
"Agreement") among the Depositor, ▇▇▇▇▇ Fargo Home Mortgage, Inc., as originator
and servicer (the "Servicer"), ▇▇▇▇▇ Fargo Bank Minnesota, N.A., as trust
administrator (the "Trust Administrator"), and The Chase Manhattan Bank, as
trustee (the "Trustee"). To the extent not defined herein, the capitalized terms
used herein have the meanings assigned in the Agreement. This Certificate is
issued under and is subject to the terms, provisions and conditions of the
Agreement, to which Agreement the Holder of this Certificate by virtue of the
acceptance hereof assents and by which such Holder is bound.
No transfer of a Certificate of this Class 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 laws. In the event that a
transfer is to be made in reliance upon an exemption from the Securities Act and
such laws, in order to assure compliance with the Securities Act and such laws,
the Certificateholder desiring to effect such transfer and such
Certificateholder's prospective transferee shall each certify to the Trustee in
writing the facts surrounding the transfer. In the event that such a transfer is
to be made within three years from the date of the initial issuance of
Certificates pursuant hereto, there shall also be delivered (except in the case
of a transfer pursuant to Rule 144A of the Securities Act) to the Trustee an
Opinion of Counsel that such transfer may be made pursuant to an exemption from
the Securities Act and such state securities laws, which Opinion of Counsel
shall not be obtained at the expense of the Trustee, the Servicer, or the
Depositor. The Holder hereof desiring to effect such transfer shall, and does
hereby agree to, indemnify the Trustee and the Depositor against any liability
that may result if the transfer is not so exempt or is not made in accordance
with such federal and state laws.
No transfer of a Certificate of this Class shall be made unless the
Trustee shall have received either (i) a representation (letter) from the
transferee of such Certificate, acceptable to and in form and substance
satisfactory to the Trustee, to the effect that such transferee is not an
employee benefit plan subject to Title I of ERISA, 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, which representation letter shall not be an expense of
the Trustee or the Servicer, (ii) if the purchaser is an insurance company, a
representation that the purchaser is an insurance company which is purchasing
such Certificates with funds contained in an "insurance company general account"
(as such term is defined in Section V(e) of Prohibited Transaction Class
Exemption 95-60 ("PTCE 95-60")) and that the purchase and holding of such
Certificates are covered under Sections I and III of PTCE 95-60, or (iii) in the
case of any such Certificate presented for registration in the name of an
employee benefit plan subject to ERISA, Section 4975 of the Code or Similar Law
(or comparable provisions of any subsequent enactments), or a trustee of any
such plan or any other person acting on behalf of any such plan, an Opinion of
Counsel satisfactory to the Trustee and the Servicer to the effect that the
purchase or holding of such Certificate will not result in the assets of the
Trust Fund being deemed to be "plan assets" and subject to the prohibited
transaction provisions of ERISA and the Code or similar provisions of Similar
Law and will not subject the Trustee to any obligation in addition to those
undertaken in the Agreement, which Opinion of Counsel shall not be an expense of
the Trustee or the Servicer. (Such representation shall be deemed to have been
made to the Trustee by the Transferee's acceptance of a Certificate of this
Class and by a beneficial owner's acceptance of its interest in a Certificate of
this Class.) Notwithstanding anything else to the contrary herein, any purported
transfer of a Certificate of this Class to or on behalf of an employee benefit
plan subject to ERISA, the Code or Similar Law without the opinion of counsel
satisfactory to the Trustee as described above shall be void and of no effect.
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 countersigned by an
authorized signatory of the Trustee.
IN WITNESS WHEREOF, the Trustee has caused this Certificate to be
duly executed.
Dated: ____________, 200_
THE CHASE MANHATTAN BANK,
as Trustee
By:____________________________________
Countersigned:
By:__________________________________
Authorized Signatory of
THE CHASE MANHATTAN BANK,
as Trustee
EXHIBIT D
(RESERVED)
EXHIBIT E
(Form of Reverse of Certificates)
MORTGAGE ASSET SECURITIZATION TRANSACTIONS, INC.
MASTR ADJUSTABLE RATE MORTGAGES TRUST 2001-1
Mortgage Pass-Through Certificates, Series 2001-1
This Certificate is one of a duly authorized issue of Certificates
designated as Mortgage Asset Securitization Transactions, Inc. MASTR Adjustable
Rate Mortgages Trust 2001-1, Mortgage Pass-Through Certificates, of the Series
specified on the face hereof (herein collectively called the "Certificates"),
and representing a beneficial ownership interest in the Trust Fund created by
the Agreement.
The Certificateholder, by its acceptance of this Certificate, agrees
that it will look solely to the funds on deposit in the Distribution Account for
payment hereunder and that the Trustee is not liable to the Certificateholders
for any amount payable under this Certificate or the Agreement or, except as
expressly provided in the Agreement, subject to any liability under the
Agreement.
This Certificate does not purport to summarize the Agreement and
reference is made to the Agreement for the interests, rights and limitations of
rights, benefits, obligations and duties evidenced thereby, and the rights,
duties and immunities of the Trustee.
Pursuant to the terms of the Agreement, a distribution will be made
on the 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 applicable to each
Distribution Date is the last Business Day of the month next preceding the month
of such Distribution Date.
Distributions on this Certificate shall be made by wire transfer of
immediately available funds to the account of the Holder hereof at a bank or
other entity having appropriate facilities therefor, if such Certificateholder
shall have so notified the Trustee in writing at least five Business Days prior
to the related Record Date and such Certificateholder shall satisfy the
conditions to receive such form of payment set forth in the Agreement, or, if
not, by check mailed by first class mail to the address of such
Certificateholder appearing in the Certificate Register. The final distribution
on each Certificate will be made in like manner, but only upon presentment and
surrender of such Certificate at the Office of the Trustee 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 Transferors, the Depositor, the Servicer and the Trustee 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 Trustee upon surrender of this Certificate for
registration of transfer at the Corporate Trust Office of the Trustee,
accompanied by a written instrument of transfer in form satisfactory to the
Trustee and the Certificate Registrar duly executed by the holder hereof or such
holder's attorney duly authorized in writing, and thereupon one or more new
Certificates of the same Class in authorized denominations and evidencing the
same aggregate Percentage Interest in the Trust Fund will be issued to the
designated transferee or transferees.
The Certificates are issuable only as registered Certificates
without coupons in denominations specified in the Agreement. As provided in the
Agreement and subject to certain limitations therein set forth, Certificates are
exchangeable for new Certificates of the same Class in authorized denominations
and evidencing the same aggregate Percentage Interest, as requested by the
Holder surrendering the same.
No service charge will be made for any such registration of transfer
or exchange, but the Trustee may require payment of a sum sufficient to cover
any tax or other governmental charge payable in connection therewith.
The Depositor, the Servicer, and the Trustee and any agent of the
Depositor, the Servicer or the Trustee may treat the Person in whose name this
Certificate is registered as the owner hereof for all purposes, and neither the
Depositor, the Servicer, the Trustee, nor any such agent shall be affected by
any notice to the contrary.
On any Distribution Date on which the Pool Principal Balance is less
than 10% of the aggregate Cut-off Date Principal Balances of the Mortgage Loans,
the Servicer will have the option to repurchase, in whole, from the Trust Fund
all remaining Mortgage Loans and all property acquired in respect of the
Mortgage Loans at a purchase price determined as provided in the Agreement. In
the event that no such optional termination occurs, the obligations and
responsibilities created by the Agreement will terminate upon the later of the
maturity or other liquidation (or any advance with respect thereto) of the last
Mortgage Loan remaining in the Trust Fund or the disposition of all property in
respect thereof and the distribution to Certificateholders of all amounts
required to be distributed pursuant to the Agreement. In no event, however, will
the trust created by the Agreement continue beyond the expiration of 21 years
from the death of the last survivor of the descendants living at the date of the
Agreement of a certain person named in 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.
ASSIGNMENT
FOR VALUE RECEIVED, the undersigned hereby sell(s), assign(s) and
transfer(s) unto _______________________________________________________________
________________________________________________________________________________
________________________________________________________________________________
(Please print or typewrite name and address
including postal zip code of assignee)
the Percentage Interest evidenced by the within Certificate and hereby
authorizes the transfer of registration of such Percentage Interest to assignee
on the Certificate Register of the Trust Fund.
I (We) further direct the Trustee to issue a new Certificate of a
like denomination and Class, to the above named assignee and deliver such
Certificate to the following address:
Dated:
_________________________________________
Signature by or on behalf of assignor
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 _____________________.
Statements should be mailed to _________________________________________________
________________________________________________________________________________
________________________________________________________________________________
This information is provided by, ___________________________________
the assignee named above, or __________________________________________________,
as its agent.
STATE OF )
) ss.:
COUNTY OF )
On the day of _______, 200_ before me, a notary public in and for
said State, personally appeared ___________________________________, known to me
who, being by me duly sworn, did depose and say that he executed the foregoing
instrument.
___________________________________
Notary Public
[Notarial Seal]
EXHIBIT F
FORM OF INITIAL CERTIFICATION OF TRUST ADMINISTRATOR
[date]
Mortgage Asset Securitization Transactions, Inc.
▇▇▇▇ ▇▇▇▇▇▇ ▇▇ ▇▇▇ ▇▇▇▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇ ▇▇▇▇▇
The Chase Manhattan Bank
▇▇▇ ▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇ ▇▇▇▇▇
Re: Pooling and Servicing Agreement among , Mortgage Asset Securitization
Transactions, Inc. as Depositor, ▇▇▇▇▇ Fargo Home Mortgage, Inc., as
originator and servicer, The Chase Manhattan Bank, as trustee, and
▇▇▇▇▇ Fargo Bank Minnesota, N.A., as trust administrator. MASTR
Adjustable Rate Mortgage Trust 2001-1, Mortgage Pass-Through
Certificates, Series ▇▇▇▇-▇
▇▇▇▇▇▇▇▇▇:
In accordance with Section 2.02 of the above-captioned Pooling and
Servicing Agreement (the "Pooling and Servicing Agreement"), the undersigned, as
Trust Administrator, hereby certifies that, as to each Mortgage Loan listed in
the Mortgage Loan Schedule (other than any Mortgage Loan paid in full or any
Mortgage Loan listed on the attached schedule) it has received:
(i) (a) the original Mortgage Note or (b) with respect to any Lost
Mortgage Note, a lost note affidavit from the Depositor stating that the
original Mortgage Note was lost or destroyed; and
(ii) a duly executed assignment of the 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 Trust Administrator has made no independent examination of any
documents contained in each Mortgage File beyond the review specifically
required in the Pooling and Servicing Agreement. The Trust Administrator 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.
Capitalized words and phrases used herein shall have the respective
meanings assigned to them in the Pooling and Servicing Agreement.
▇▇▇▇▇ FARGO BANK MINNESOTA, N.A.,
as Trust Administrator
By:____________________________________
Name:
Title:
EXHIBIT G
FORM OF FINAL CERTIFICATION OF TRUST ADMINISTRATOR
[date]
Mortgage Asset Securitization Transactions, Inc.
▇▇▇▇ ▇▇▇▇▇▇ ▇▇ ▇▇▇ ▇▇▇▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇ ▇▇▇▇▇
The Chase Manhattan Bank
▇▇▇ ▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇ ▇▇▇▇▇
Re: Pooling and Servicing Agreement among , Mortgage Asset Securitization
Transactions, Inc. as Depositor, ▇▇▇▇▇ Fargo Home Mortgage, Inc., as
originator and servicer, The Chase Manhattan Bank, as trustee, and
▇▇▇▇▇ Fargo Bank Minnesota, N.A., as trust administrator. MASTR
Adjustable Rate Mortgage Trust 2001-1, Mortgage Pass-Through
Certificates, Series ▇▇▇▇-▇
▇▇▇▇▇▇▇▇▇:
In accordance with Section 2.02 of the above-captioned Pooling and
Servicing Agreement (the "Pooling and Servicing Agreement"), the undersigned, as
Trust Administrator, hereby certifies that as to each Mortgage Loan listed in
the Mortgage Loan Schedule (other than any Mortgage Loan paid in full or listed
on the attached Document Exception Report) it has received:
(i) The original Mortgage Note endorsed in the form provided in
Section 2.01(c) of the Pooling and Servicing Agreement, with all intervening
endorsements showing a complete chain of endorsement from the transferor to the
Depositor.
(ii) The original recorded Mortgage.
(iii) A duly executed assignment of the Mortgage in the form
provided in Section 2.01(c) of the Pooling and Servicing Agreement, or, if the
Depositor has certified or the Trustee otherwise knows that the related Mortgage
has not been returned from the applicable recording office, a copy of the
assignment of the Mortgage (excluding information to be provided by the
recording office).
(iv) The original or duplicate original recorded assignment or
assignments of the Mortgage showing a complete chain of assignment from the
originator to the Depositor.
(v) The original or duplicate original lender's title policy and
all riders thereto or, any one of an original title binder, an original
preliminary title report or an original title commitment, or a copy thereof
certified by the title company.
Based on its review and examination and only as to the foregoing
documents, (a) such documents appear regular on their face and related to such
Mortgage Loan, and (b) the information set forth in items (1), (2) and (9) of
the definition of the "Mortgage Loan Schedule" in Section 1.01 of the Pooling
and Servicing Agreement accurately reflects information set forth in the
Mortgage File.
The Trust Administrator has made no independent examination of any
documents contained in each Mortgage File beyond the review specifically
required in the Pooling and Servicing Agreement. The Trust Administrator 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.
Capitalized words and phrases used herein shall have the respective
meanings assigned to them in the Pooling and Servicing Agreement.
▇▇▇▇▇ FARGO BANK MINNESOTA, N.A.,
as Trust Administrator
By:____________________________________
Name:
Title:
EXHIBIT H
FORM OF CLASS A-R TRANSFER AFFIDAVIT
MASTR ADJUSTABLE RATE MORTGAGES TRUST 2001-1
Mortgage Asset Securitization Transactions, Inc.
Mortgage Pass-Through Certificates
Series 2001-1
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 A-R Certificate (the "Certificate") issued
pursuant to the Pooling and Servicing Agreement, (the "Agreement"), relating to
the above-referenced Series, by and among Mortgage Asset Securitization
Transactions, Inc., as depositor (the "Depositor"), ▇▇▇▇▇ Fargo Home Mortgage,
Inc., as originator and servicer, ▇▇▇▇▇ Fargo Bank Minnesota, N.A., as trust
administrator (the "Trust Administrator"), and The Chase Manhattan Bank, as
trustee. Capitalized terms used, but not defined herein or in Exhibit 1 hereto,
shall have the meanings ascribed to such terms in the Agreement. The Transferee
has authorized the undersigned to make this affidavit on behalf of the
Transferee.
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 either (i) for its own account or (ii) as
nominee, trustee or agent for another Person and has attached hereto an
affidavit from such Person in substantially the same form as this affidavit. 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; provided,
that a pass-through entity which is an "electing large partnership" under the
Code will be subject to tax in all events. (For this purpose, a "pass-through
entity" includes a regulated investment company, a real estate investment trust
or common trust fund, a partnership, trust or estate, and certain cooperatives
and, except as may be provided in Treasury Regulations, persons holding
interests in pass-through entities as a nominee for another Person.) The
Transferee further understands that it may incur tax liabilities with respect to
the holding of the Certificate in excess of cash flows generated thereby.
5. The Transferee has reviewed the provisions of Section 5.02(c) of
the Agreement (attached hereto as Exhibit 2 and incorporated herein by
reference) and understands the legal consequences of the acquisition of an
Ownership Interest in the Certificate including, without limitation, the
restrictions on subsequent Transfers and the provisions regarding voiding the
Transfer and mandatory sales. The Transferee expressly agrees to be bound by and
to abide by the provisions of Section 5.02(c) of the Agreement and the
restrictions noted on the face of the Certificate. The Transferee understands
and agrees that any breach of any of the representations included herein shall
render the Transfer to the Transferee contemplated hereby null and void.
6. The Transferee agrees to require a Transfer Affidavit from any
Person to whom the Transferee attempts to Transfer its Ownership Interest in the
Certificate, and in connection with any Transfer by a Person for whom the
Transferee is acting as nominee, trustee or agent, and the Transferee will not
Transfer its Ownership Interest or cause any Ownership Interest to be
Transferred to any Person that the Transferee knows is not a Permitted
Transferee. In connection with any such Transfer by the Transferee, the
Transferee agrees to deliver to the Trustee a certificate substantially in the
form set forth as Exhibit I 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 does not have the intention to impede the
assessment or collection of any tax legally required to be paid with respect to
the Certificate. The Transferee historically has paid its debts as they have
become due and intends to do so in the future.
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 has computed any consideration paid to it to
acquire the Class A-R Certificate in accordance with proposed U.S. Treasury
Regulations Sections 1.860E-1(a)(4)(iii) and 1.860E-1(c)(5) (or, after they have
been finalized, the final regulations) by computing present values using a
discount rate equal to the applicable Federal rate prescribed by Section 1274(d)
of the Code, compounded semi-annually.]
[The Transferee has computed any consideration paid to it to acquire
the Class A-R Certificate in accordance with proposed U.S. Treasury Regulations
Sections 1.860E-1(a)(4)(iii) and 1.860E-1(c)(5) (or, after they have been
finalized, the final regulations) by computing present values using a discount
rate at least equal to the rate at which the Transferee regularly borrows, in
the ordinary course of its trade or business, substantial funds from unrelated
third parties. The Transferee has provided all information necessary to
demonstrate to the transferor that it regularly borrows at such rate.]
[The transfer of the Class A-R Certificate complies with Section 6
of Revenue Procedure 2001-12 (the "Revenue Procedure"), 2001-3 I.R.B. 335
(January 16, 2001) (or comparable provisions of applicable final U.S. Treasury
Regulations) and, accordingly,
(i) the Transferee is an "eligible corporation," as defined in
Section 860L(a)(2) of the Code, as to which income from Class
A-R 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 Purchaser within the meaning of Section 860L(g)
of the Code) in excess of $100 million and net assets in
excess of $10 million;
(iii) the Transferee will transfer the Class A-R Certificate only to
another "eligible corporation," as defined in Section
860(a)(2) of the Code, in a transaction that satisfies the
requirements of Section 4 of the Revenue Procedure; and
(iv) the Transferee determined the consideration paid to it to
acquire the Class A-R 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 Purchaser) that it has determined in good faith.]
[Reserved]
12. 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 ("Similar Law") materially
similar to the foregoing provisions of ERISA or the Code, and the Transferee is
not acting on behalf of such a plan.
* * *
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 __________________, 200_.
_______________________________________
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 _______, 200_.
_____________________________________
NOTARY PUBLIC
My Commission expires the ______ day of
________________, 200_.
EXHIBIT 1
to EXHIBIT H
Certain Definitions
"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.
"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)(l) 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
citizen or resident of the United States, a corporation, partnership (except as
provided in applicable Treasury Regulations), or other entity created or
organized in or under the laws of the United States or any political subdivision
thereof, an estate whose income is subject to United States federal income tax
purposes regardless of its source or a trust if a court within the United States
is able to exercise primary supervision over the administration of the trust and
one or more persons described in this clause (v) have the authority to control
all substantial decisions of the trust (or, to the extent provided in applicable
Treasury Regulations, certain trusts in existence on August 20, 1996 which are
eligible to elect to be treated as United States persons) unless such Person has
furnished the transferor and the Trustee with a duly completed Internal Revenue
Service Form W-8ECI or any applicable successor form, and (vi) 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 a REMIC hereunder 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.
"Person": Any individual, corporation, partnership, joint venture,
association, joint-stock company, trust, unincorporated organization or
government or any agency or political subdivision thereof.
"Transfer": Any direct or indirect transfer or sale of any
Ownership Interest in a Residual Certificate.
"Transferee": Any Person who is acquiring by Transfer any
Ownership Interest in a Residual Certificate.
EXHIBIT 2
to EXHIBIT H
Section 5.02(c) of the Agreement
(a) Each Person who has or who acquires any Ownership Interest in
a Residual Certificate shall be deemed by the acceptance or acquisition of such
Ownership Interest to have agreed to be bound by the following provisions, and
the rights of each Person acquiring any Ownership Interest in a Residual
Certificate are expressly subject to the following provisions:
(i) Each Person holding or acquiring any Ownership Interest in a
Residual Certificate shall be a Permitted Transferee and shall promptly notify
the Trustee of any change or impending change in its status as a Permitted
Transferee.
(ii) No Ownership Interest in a Residual Certificate may be
registered on the Closing Date or thereafter transferred, and the Trustee shall
not register the Transfer of any Residual Certificate unless, in addition to the
certificates required to be delivered to the Trustee under subparagraph (b)
above, the Trustee shall have been furnished with an affidavit (a "Transfer
Affidavit") of the initial owner or the proposed transferee in the form attached
hereto as Exhibit H.
(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. The Trustee shall be under no liability to any Person for any
registration of Transfer of a Residual Certificate that is in fact not permitted
by Section 5.02(b) and this Section 5.02(c) or for making any payments due on
such Certificate to the Holder thereof or taking any other action with respect
to such Holder under the provisions of this Agreement so long as the Transfer
was registered after receipt of the related Transfer Affidavit, Transferor
Certificate and either the Rule 144A Letter or the Investment Letter. The
Trustee shall be entitled but not obligated to recover from any Holder of a
Residual Certificate that was in fact not a Permitted Transferee at the time it
became a Holder or, at such subsequent time as it became other than a Permitted
Transferee, all payments made on such Residual Certificate at and after either
such time. Any such payments so recovered by the Trustee shall be paid and
delivered by the Trustee to the last preceding Permitted Transferee of such
Certificate.
(v) The Depositor shall use its best efforts to make available,
upon receipt of written request from the Trustee, all information necessary to
compute any tax imposed under Section 860E(e) of the Code as a result of a
Transfer of an Ownership Interest in a Residual Certificate to any Holder who is
not a Permitted Transferee described in clauses (i) through (iv) of the
definition thereof.
The restrictions on Transfers of a Residual Certificate set forth in
this Section 5.02(c) shall cease to apply (and the applicable portions of the
legend on a Residual Certificate may be deleted) with respect to Transfers
occurring after delivery to the Trustee of an Opinion of Counsel, which Opinion
of Counsel shall not be an expense of the Trust Fund, the Trustee, the Loan
Seller, the Transferors or the Servicer, to the effect that the elimination of
such restrictions will not cause any REMIC hereunder to fail to qualify as a
REMIC at any time that the Certificates are outstanding or result in the
imposition of any tax on the Trust Fund, a Certificateholder or another Person.
Each Person holding or acquiring any Ownership Interest in a Residual
Certificate hereby consents to any amendment of this Agreement which, based on
an Opinion of Counsel furnished to the Trustee, is reasonably necessary (a) to
ensure that the record ownership of, or any beneficial interest in, a Residual
Certificate is not transferred, directly or indirectly, to a Person that is 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.
EXHIBIT I
FORM OF TRANSFEROR CERTIFICATE
____________________
Date
Mortgage Asset Securitization Transactions, Inc.
▇▇▇▇ ▇▇▇▇▇▇ ▇▇ ▇▇▇ ▇▇▇▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇
Attention:
The Chase Manhattan Bank
▇▇▇ ▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇ ▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇
Attention: Institutional Trust Services/Structured
Finance - MARM 2001-1
Re: Mortgage Asset Securitization Transactions, Inc., MASTR Adjustable
Rate Mortgages Trust 2001-1, Mortgage Pass-Through Certificates,
Series 2001-1, Class [ ]
------------------------------------------------------------------
Ladies and Gentlemen:
In connection with our disposition of the above Certificates we
certify that (a) 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 Securities Act of 1933, as amended and (b) to the extent we are
disposing of a Class A-R Certificate, (i) we have no knowledge the Transferee is
not a Permitted Transferee and (ii) after conducting a reasonable investigation
of the financial condition of the transferee, we have no reason to believe that
the transferee will not pay taxes with respect to the Class A-R Certificate when
due.
Very truly yours,
_______________________________________
Print Name of Transferor
By:____________________________________
Authorized Officer
EXHIBIT J
FORM OF INVESTMENT LETTER (NON-RULE 144A)
_________________________________
Date
Mortgage Asset Securitization Transactions, Inc.
▇▇▇▇ ▇▇▇▇▇▇ ▇▇ ▇▇▇ ▇▇▇▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇
Attention:
The Chase Manhattan Bank
▇▇▇ ▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇ ▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇
Attention: Institutional Trust Services/Structured
Finance - MARM 2001-1
Re: Mortgage Asset Securitization Transactions, Inc., MASTR Adjustable
Rate Mortgages Trust 2001-1, Mortgage Pass-Through Certificates,
Series 2001-1, 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 are an
"accredited investor," as defined in Regulation D under the Act, and 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 (i) we are not an employee benefit plan
that is subject to Title I of the Employee Retirement Income Security Act of
1974, as amended, or a plan or arrangement that is subject to Section 4975 of
the Internal Revenue Code of 1986, as amended, or a plan or arrangement subject
to any federal, state or local law ("Similar Law") materially similar to the
foregoing provisions of ERISA or the Code, nor are we acting on behalf of any
such plan or arrangement, nor are we using the assets of any such plan or
arrangement to effect such acquisition or (ii) if we are an insurance company, a
representation that we are an insurance company which is purchasing such
Certificates with funds contained in an "insurance company general account" (as
such term is defined in Section V(e) of Prohibited Transaction Class Exemption
95-60 ("PTCE 95-60")) and that the purchase and holding of such Certificates are
covered under Sections I and III of PTCE 95-60, (e) we are acquiring the
Certificates for investment for our own account and not with a view to any
distribution of such Certificates (but without prejudice to our right at all
times to sell or otherwise dispose of the Certificates in accordance with clause
(g) below), (f) 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, or taken any other action which
would result in a violation of Section 5 of the Act, and (g) we will not sell,
transfer or otherwise dispose of any Certificates unless (1) such sale, transfer
or other disposition is made pursuant to an effective registration statement
under the Act or is exempt from such registration requirements, and if
requested, we will at our expense provide an opinion of counsel satisfactory to
the addressees of this Certificate that such sale, transfer or other disposition
may be made pursuant to an exemption from the Act, (2) the purchaser or
transferee of such Certificate has executed and delivered to you a certificate
to substantially the same effect as this certificate, and (3) the purchaser or
transferee has otherwise complied with any conditions for transfer set forth in
the Pooling and Servicing Agreement.
Very truly yours,
_______________________________________
Print Name of Transferor
By:____________________________________
Authorized Officer
EXHIBIT K
FORM OF RULE 144A LETTER
____________________________
Date
Mortgage Asset Securitization Transactions, Inc.
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Attention:
The Chase Manhattan Bank
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Attention: Institutional Trust Services/Structured
Finance - MARM 2001-1
Re: Mortgage Asset Securitization Transactions, Inc., MASTR Adjustable
Rate Mortgages Trust 2001-1, Mortgage Pass-Through Certificates,
Series 2001-1, Class [ ]
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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 (i) we are not an employee benefit plan
that is subject to Title I of the Employee Retirement Income Security Act of
1974, as amended, or a plan or arrangement that is subject to Section 4975 of
the Internal Revenue Code of 1986, as amended, or a plan or arrangement that is
subject to Section 4975 of the Internal Revenue Code 1986, as amended, or a plan
or arrangement subject to any federal, state or local law ("Similar Law")
materially similar to the foregoing provisions of ERISA or the Code, nor are we
acting on behalf of any such plan or arrangement, nor are we using the assets of
any such plan or arrangement to effect such acquisition or (ii) if we are an
insurance company, a representation that we are an insurance company which is
purchasing such Certificates with funds contained in an "insurance company
general account" (as such term is defined in Section V(e) of Prohibited
Transaction Class Exemption 95-60 ("PTCE 95-60")) and that the purchase and
holding of such Certificates are covered under PTCE 95-60, (e) we have not, nor
has anyone acting on our behalf offered, transferred, pledged, sold or otherwise
disposed of the Certificates, any interest in the Certificates or any other
similar security to, or solicited any offer to buy or accept a transfer, pledge
or other disposition of the Certificates, any interest in the Certificates or
any other similar security from, or otherwise approached or negotiated with
respect to the Certificates, any interest in the Certificates or any other
similar security with, any person in any manner, or made any general
solicitation by means of general advertising or in any other manner, 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, (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.
ANNEX 1
to EXHIBIT K
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 either at least $100,000 in securities
or, if Buyer is a dealer, Buyer must own and/or invest on a discretionary basis
at least $10,000,000 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.
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 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 Buyer
By:____________________________________
Name:
Title:
Date:
ANNEX 2
to EXHIBIT K
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.
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 Buyer or Adviser
By:____________________________________
Name:
Title:
IF AN ADVISER:
_______________________________________
Print Name of Buyer
Date:
EXHIBIT L
FORM OF REQUEST FOR RELEASE OF DOCUMENTS
(for Trust Administrator)
To: ▇▇▇▇▇ Fargo Bank Minnesota, N.A.
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Attn: Inventory Control
Re: Pooling and Servicing Agreement dated as of September 1, 2001,
Mortgage Asset Securitization Transactions, Inc., as depositor,
▇▇▇▇▇ Fargo Home Mortgage, Inc., as servicer, The Chase Manhattan
Bank, as trustee, and ▇▇▇▇▇ Fargo as trust administrator,
In connection with the administration of the Mortgage Loans held by you as
Trust Administrator pursuant to the above-captioned Pooling and Servicing
Agreement, we request the release, and hereby acknowledge receipt, of the
Mortgage File for the Mortgage Loan described below, for the reason indicated.
Mortgage Loan Number:
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Mortgagor Name, Address & Zip Code:
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Reason for Requesting Documents (check one):
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__________________1. Mortgage Paid in Full
__________________2. Foreclosure
__________________3. Substitution
__________________4. Other Liquidation (Repurchases, etc.)
__________________5. Nonliquidation Reason:____________________________
Address to which Custodian should
Deliver the Trust Administrator's
Mortgage File: _________________________________________
_________________________________________
_________________________________________
By:______________________________________
(authorized signer)
Issuer:__________________________________
Address:_________________________________
Date:____________________________________
Trust Administrator
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▇▇▇▇▇ Fargo Bank Minnesota, N.A.
Please acknowledge the execution of the above request by your signature and date
below:
____________________________________ _______________________
Signature Date
Documents returned to Custodian:
____________________________________ _______________________
Custodian Date