SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 8-K
CURRENT REPORT
Pursuant to Section 13 or 15(d) of the
Securities Exchange Act of 1934
Date of Report: January 11, 2000
(Date of earliest event reported)
Commission File No. 333-62547
Asset Backed Funding Corporation
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Delaware 75-2533468
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(State of Incorporation) (I.R.S. Employer
Identification No.)
100 North Tryon Street
Charlotte, North Carolina 28255
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Address of principal executive offices (Zip Code)
(704) 386-2400
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Registrant's Telephone Number, including area code
NationsBanc Asset Securities, Inc.
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(Former name, former address and former fiscal year,
if changed since last report)
<PAGE>
ITEM 5. Other Events
On December 21, 1999, Asset Backed Funding Corporation (the
"Corporation"), sold Asset Backed Funding Certificates, Series 1999-1, Class
A-1A, Class A-1F, Class, A-2F, Class M-1, Class M-2 and Class B (the "Offered
Certificates"), having an aggregate original principal balance of
$125,712,000.00. The Offered Certificates were issued pursuant to the Pooling
and Servicing Agreement, dated as of November 1, 1999 (the "Agreement"), among
the Corporation, as depositor, C-BASS, as seller, Litton Loan Servicing, LP
("Litton"), and The Chase Manhattan Bank, as trustee, a copy of which is filed
as an exhibit hereto. Asset Backed Funding Certificates, Series 1999-1, Class
BB, Class X and Class R (the "Private Certificates" and, together with the
Offered Certificates, the "Certificates"), were also issued pursuant to the
Agreement but were not publicly offered.
As of the date of initial issuance, the Offered Certificates
evidenced beneficial ownership interests in a trust (the "Trust"), consisting
primarily of (i) two groups of mortgage loans, each divided into two subgroups
consisting of fixed-rate and adjustable-rate mortgage loans, secured by
mortgages creating first liens on one- to four-family properties, (ii) a primary
mortgage guaranty insurance policy issued by Mortgage Guaranty Insurance
Corporation and (iii) certain other property. The remaining undivided interests
in the Trust are evidenced by the Private Certificates.
Interest on the Offered Certificates will be distributed on each
Distribution Date (as defined in the Agreement). Monthly distributions in
reduction of the principal balance of the Offered Certificates will be allocated
to the Offered Certificates in accordance with the priorities set forth in the
Agreement.
An election will be made to treat certain assets of the Trust as one
or more real estate mortgage investment conduits for federal income tax purposes
(each, a "REMIC").
ITEM 7. Financial Statements and Exhibits
Item 601(a)
of Regulation S-K
Exhibit No. Description
- ----------- -----------
(EX-4) Pooling and Servicing Agreement, dated as
of November 1, 1999, among Asset Backed
Funding Corporation, C-BASS, Litton Loan
Servicing, LP and The Chase Manhattan Bank,
as trustee.
(EX-99.1) Mortgage Guaranty Insurance Policy
issued by Mortgage Guaranty Insurance
Corporation.
<PAGE>
Pursuant to the requirements of the Securities Exchange Act of 1934,
the registrant has duly caused this report to be signed on its behalf by the
undersigned hereunto duly authorized.
ASSET BACKED FUNDING CORPORATION
January 11, 2000
By: /s/ Bob Perret
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Name: Bob Perret
Title: Senior Vice President
<PAGE>
INDEX TO EXHIBITS
Paper (P) or
Exhibit No. Description Electronic (E)
- ----------- ----------- --------------
(EX-4) Pooling and Servicing Agreement, E
dated as E of October 1, 1999, among
Asset Backed Funding Corporation,
C-BASS, Litton Loan Servicing, LP
and The Chase Manhattan Bank, as
trustee.
(EX-99.1) Mortgage Guaranty Insurance Policy E
issued by Mortgage Guaranty Insurance
Corporation.
EXECUTION COPY
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ASSET BACKED FUNDING CORPORATION,
Depositor
CREDIT-BASED ASSET SERVICING AND SECURITIZATION LLC,
Seller
LITTON LOAN SERVICING LP,
Servicer
and
THE CHASE MANHATTAN BANK,
Trustee
POOLING AND SERVICING AGREEMENT
Dated as of November 1, 1999
Asset Backed Funding Trust 1999-1
Asset Backed Funding Certificates, Series 1999-1
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<PAGE>
TABLE OF CONTENTS
Page
ARTICLE I
DEFINITIONS
Section 1.01 Defined Terms...............................................
Section 1.02 Accounting..................................................
ARTICLE II
CONVEYANCE OF MORTGAGE LOANS;
ORIGINAL ISSUANCE OF CERTIFICATES
Section 2.01 Conveyance of Mortgage Loans................................
Section 2.02 Acceptance by Trustee.......................................
Section 2.03 Repurchase or Substitution of Mortgage Loans by the Seller..
Section 2.04 Representations and Warranties of the Seller with Respect
to the Mortgage Loans......................................
Section 2.05 Representations, Warranties and Covenants of the Servicer...
Section 2.06 Representations and Warranties of the Depositor.............
Section 2.07 Issuance of Certificates and the Uncertificated Regular
Interests..................................................
Section 2.08 Representations and Warranties of the Seller................
Section 2.09 Covenants of the Seller.....................................
Section 2.10 Repurchase of Originator Mortgage Loans.....................
ARTICLE III
ADMINISTRATION AND SERVICING
OF THE TRUST FUND
Section 3.01 Servicer to Act as Servicer.................................
Section 3.02 Collection of Mortgage Loan Payments........................
Section 3.03 Realization Upon Defaulted Mortgage Loans...................
Section 3.04 Collection Account and Distribution Account.................
Section 3.05 Permitted Withdrawals From the Collection Account...........
Section 3.06 Establishment of Escrow Accounts; Deposits in
Escrow Accounts............................................
Section 3.07 Permitted Withdrawals From Escrow Account...................
Section 3.08 Payment of Taxes, Insurance and Other Charges; Maintenance
of Primary Insurance Policies; Collections Thereunder.......
Section 3.09 Transfer of Accounts........................................
Section 3.10 Maintenance of Hazard Insurance.............................
Section 3.11 Maintenance of Mortgage Impairment Insurance Policy.........
Section 3.12 Fidelity Bond, Errors and Omissions Insurance...............
Section 3.13 Title, Management and Disposition of REO Property...........
Section 3.14 Due-on-Sale Clauses; Assumption and Substitution Agreements.
Section 3.15 [Reserved]..................................................
Section 3.16 Optional and Mandatory Purchases of Mortgage Loans
by Seller..................................................
Section 3.17 Trustee to Cooperate; Release of Files......................
Section 3.18 Servicing Compensation......................................
Section 3.19 Annual Statement as to Compliance...........................
Section 3.20 Annual Independent Certified Public Accountants' Reports....
Section 3.21 Access to Certain Documentation and Information Regarding
the Mortgage Loans.........................................
Section 3.22 Reserved....................................................
Section 3.23 Obligations of the Servicer in Respect of Compensating
Interest...................................................
Section 3.24 Obligations of the Servicer in Respect of Mortgage Interest
Rates and Monthly Payments.................................
Section 3.25 Investment of Funds in the Collection Account and
the Distribution Account...................................
Section 3.26 Liability of Servicer; Indemnification......................
Section 3.27 Reports of Foreclosure and Abandonment of Mortgaged
Properties.................................................
Section 3.28 Seller's Compliance to the Representations and Warranties
of the Transaction Documents................................
Section 3.29 Claims Under the PMI Policy.................................
ARTICLE IV
FLOW OF FUNDS
Section 4.01 Interest Distributions......................................
Section 4.02 Distributions of Principal and Monthly Excess Cashflow
Amounts....................................................
Section 4.03 Allocation of Losses........................................
Section 4.04 Method of Distribution......................................
Section 4.05 Distributions on Book-Entry Certificates....................
Section 4.06 Statements..................................................
Section 4.07 Remittance Reports; Advances................................
Section 4.08 Class BB Reserve Fund.......................................
Section 4.09 REMIC Distributions.........................................
ARTICLE V
THE CERTIFICATES
Section 5.01 The Certificates............................................
Section 5.02 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 Appointment of Paying Agent.................................
ARTICLE VI
THE SELLER, THE SERVICER AND THE DEPOSITOR
Section 6.01 Liability of the Seller, the Servicer and the Depositor.....
Section 6.02 Merger or Consolidation of, or Assumption of the
Obligations of, the Seller, the Servicer
or the Depositor............................................
Section 6.03 Limitation on Liability of the Servicer and Others..........
Section 6.04 Servicer Not to Resign......................................
Section 6.05 Delegation of Duties........................................
ARTICLE VII
DEFAULT
Section 7.01 Servicer Events of Termination..............................
Section 7.02 Trustee to Act; Appointment of Successor....................
Section 7.03 Waiver of Defaults..........................................
Section 7.04 Notification to Certificateholders..........................
Section 7.05 Survivability of Servicer Liabilities.......................
ARTICLE VIII
THE TRUSTEE
Section 8.01 Duties of Trustee...........................................
Section 8.02 Certain Matters Affecting the Trustee.......................
Section 8.03 Trustee Not Liable for Certificates or Mortgage Loans.......
Section 8.04 Trustee May Own Certificates................................
Section 8.05 Seller to Pay Trustee Fees and Expenses.....................
Section 8.06 Eligibility Requirements for Trustee........................
Section 8.07 Resignation or Removal of Trustee...........................
Section 8.08 Successor Trustee...........................................
Section 8.09 Merger or Consolidation of Trustee..........................
Section 8.10 Appointment of Co-Trustee or Separate Trustee...............
Section 8.11 Limitation of Liability.....................................
Section 8.12 Trustee May Enforce Claims Without Possession of
Certificates................................................
Section 8.13 Suits for Enforcement.......................................
Section 8.14 Waiver of Bond Requirement..................................
Section 8.15 Waiver of Inventory, Accounting and Appraisal Requirement...
Section 8.16 Trustee Covenants Concerning Year 2000 Compliance...........
ARTICLE IX
REMIC ADMINISTRATION
Section 9.01 REMIC Administration........................................
Section 9.02 Prohibited Transactions and Activities......................
Section 9.03 Indemnification with Respect to Certain Taxes and
Loss of REMIC Status........................................
Section 9.04 REO Property................................................
ARTICLE X
TERMINATION
Section 10.01 Termination.................................................
Section 10.02 Additional Termination Requirements.........................
ARTICLE XI
MISCELLANEOUS PROVISIONS
Section 11.01 Amendment...................................................
Section 11.02 Recordation of Agreement; Counterparts......................
Section 11.03 Limitation on Rights of Certificateholders..................
Section 11.04 Governing Law; Jurisdiction.................................
Section 11.05 Notices.....................................................
Section 11.06 Severability of Provisions..................................
Section 11.07 Article and Section References..............................
Section 11.08 Notice to the Rating Agencies...............................
Section 11.09 Further Assurances..........................................
Section 11.10 Benefits of Agreement.......................................
Section 11.11 Acts of Certificateholders..................................
<PAGE>
EXHIBITS
Exhibit A-1 Form of Class A-1A Certificates
Exhibit A-2 Form of Class A-1F Certificates
Exhibit A-3 Form of Class A-2F Certificates
Exhibit B Form of Class B Certificates
Exhibit C-1 Form of Class R Certificates
Exhibit C-2 Form of Class M-1 Certificates
Exhibit C-3 Form of Class M-2 Certificates
Exhibit C-4 Form of Class X Certificates
Exhibit C-5 Form of Class BB Certificates
Exhibit D-1 Mortgage Loan Schedule of Originator Mortgage Loans
Exhibit D-2 Mortgage Loan Schedule of Seller Mortgage Loans
Exhibit D-3 List of PMI Mortgage Loans
Exhibit E Form of Request for Release
Exhibit F-1 Form of Trustee's Initial Certification
Exhibit F-2 Form of Trustee's Final Certification
Exhibit F-3 Form of Receipt of Mortgage Note
Exhibit G Mortgage Loan Purchase Agreement
Exhibit H Form of Lost Note Affidavit
Exhibit I Form of ERISA Representation
Exhibit J Form of Investment Letter
Exhibit K Form of Class R Certificate Transfer Affidavit
Exhibit L Form of Transferor Certificate
Exhibit M Reserved
Exhibit N Depository Agreement
Exhibit O Form of Servicer Request for Reimbursement
Exhibit P Monthly Information Provided by Servicer
Exhibit Q Officer's Certificate with Respect to Prepayments
<PAGE>
This Pooling and Servicing Agreement is dated as of November 1, 1999
(the "Agreement"), among ASSET BACKED FUNDING CORPORATION, as depositor (the
"Depositor"), CREDIT-BASED ASSET SERVICING AND SECURITIZATION LLC, as seller
(the "Seller"), LITTON LOAN SERVICING LP, as servicer (the "Servicer"), and THE
CHASE MANHATTAN BANK, as trustee (the "Trustee").
PRELIMINARY STATEMENT
The Depositor intends to sell pass-through certificates
(collectively, the "Certificates"), to be issued hereunder in multiple classes,
which in the aggregate will evidence the entire beneficial ownership interest in
the Trust Fund created hereunder. The Certificates will consist of nine classes
of Certificates, designated as (i) the Class A-1A, Class A-1F and Class A-2F
Certificates, (ii) the Class M-1 and Class M-2 Certificates, (iii) the Class B
Certificates, (iv) the Class BB Certificates, (v) the Class X Certificates and
(vi) the Class R Certificates.
As provided herein, the Trustee shall elect that the Trust Fund be
treated for federal income tax purposes as four separate real estate mortgage
investment conduits (each a "REMIC" or, in the alternative, "REMIC 1," "REMIC
2," "REMIC 3" and "REMIC 4," respectively). The Class T4-A1A Interest, the Class
A-1F, Class A-2F, Class M-1, Class M-2 and Class B Certificates and the Class
T4-4, Class T4-5, Class T4-6, Class T4-7, Class T4-11, Class T4-12, Class T4-13,
Class T4-14, Class T4-15 and Class T4-16 Interests) (such interests, the "REMIC
4 Components") represent all of the "regular interests" in REMIC 4. The Class
A-1A Certificates represent beneficial ownership of the Class T4-A1A Interest
and the right to receive LIBOR Carryover Amounts. The Class BB and Class X
Certificates represent beneficial ownership of the Class X/BB Interest, which
represents the REMIC 4 Components collectively. Each of the Class R-1, Class
R-2, Class R-3 and Class R-4 Interests represents the sole class of "residual
interest" in REMIC 1, REMIC 2, REMIC 3 and REMIC 4, respectively, for purposes
of the REMIC Provisions. There are four classes of uncertificated REMIC 1
Regular Interests (the Class T1-1, Class T1-2, Class T1-3 and Class T1-4
Interests), seven classes of uncertificated REMIC 2 Regular Interests (the Class
T2-1, Class T2-2, Class T2-3, Class T2-4, Class T2-5, Class T2-6 and Class T2-7
Interests), and ten classes of uncertificated REMIC 3 Regular Interests (the
Class T3-A1A, Class T3-A1F, Class T3-A2F, Class T3-M1, Class T3-M2, Class T3-B,
Class T3-4, Class T3-5, Class T3-6 and Class T3-7 Interests). Each of the
foregoing interests (other than the Class BB and Class X Certificates and the
Class X/BB Interest and the interest of the Class A-1A Certificates in the Class
T4-A1A Interest) is a "REMIC Regular Interest." The REMIC 1 Regular Interests
will be held as assets of REMIC 2, the REMIC 2 Regular Interests will be held as
assets of REMIC 3 and the REMIC 3 Regular Interests will be held as assets of
REMIC 4. If the Class BB and Class X Certificates are beneficially owned by
different persons, they will be treated as interests in a partnership that holds
the Class X/BB Interest for federal income tax purposes as described in Section
9.01(m). The "latest possible maturity date" for federal income tax purposes of
all interests created hereby will be the Distribution Date in January 25, 2030.
<PAGE>
The following table sets forth (or describes) the Class designation,
Pass-Through Rate and approximate Original Class Certificate Principal Balance
or Original Notional Amount, for each Class of Certificates comprising the
interests in the Trust Fund created hereunder:
<PAGE>
================================================================================
Original Class
Certificate
Principal or
Notional Pass-Through Assumed Final
Class Amount Rate Maturity Dates
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A-1A $51,506,000 (1) June 25, 2013
A-1F $47,042,000 7.570%(2) November 25, 2030
A-2F $5,939,000 7.641%(3) October 25, 2030
M-1 $9,143,000 8.390%(4) November 25, 2030
M-2 $6,531,000 8.650%(5) November 25, 2030
B $5,551,000 8.650%(6) November 25, 2030
BB $6,975,000(7)(8) 7.000% November 25, 2030
X (8) N/A November 25, 2030
R N/A N/A N/A
Total $125,712,000
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(1) Interest will accrue on the Class A-1A Certificates during
each Interest Accrual Period at a rate equal to the lesser of:
(i) the Class A-1A Pass-Through Rate and (ii) the applicable
Maximum Rate for such Distribution Date.
(2) Interest will accrue on the Class A-1F Certificates at a rate
equal to the lesser of: (i) the Class A-1F Pass-Through Rate
and (ii) the applicable Maximum Rate for such Distribution
Date.
(3) Interest will accrue on the Class A-2F Certificates at a rate
equal to the lesser of: (i) the Class A-2F Pass-Through Rate
and (ii) the applicable Maximum Rate for such Distribution
Date.
(4) Interest will accrue on the Class M-1 Certificates at a rate
equal to the lesser of: (i) the Class M-1 Pass-Through Rate
and (ii) the applicable Maximum Rate for such Distribution
Date.
(5) Interest will accrue on the Class M-2 Certificates at a rate
equal to the lesser of: (i) the Class M-2 Pass-Through Rate
and (ii) the applicable Maximum Rate for such Distribution
Date.
(6) Interest will accrue on the Class B Certificates at a rate
equal to the lesser of: (i) the Class B Pass-Through Rate and
(ii) the applicable Maximum Rate for such Distribution Date.
(7) Notional Amount.
(8) The Class BB and Class X Certificates, collectively, represent
the beneficial ownership of the Class X/BB Interest, which
represents the Class T4-4, Class T4-5, Class T4-6, Class T4-7,
Class T4-11, Class T4-12, Class T4-13, Class T4-14, Class
T4-15 and Class T4-16 Interests.
ARTICLE I
DEFINITIONS
Section 1.01 Defined Terms.
Whenever used in this Agreement or in the Preliminary Statement, the
following words and phrases, unless the context otherwise requires, shall have
the meanings specified in this Article. Unless otherwise specified, interest on
the Class A-1F, Class A-2F, Class M-1, Class M-2, Class B and Class BB
Certificates will be calculated on the basis of a 360-day year consisting of
twelve 30-day months. Interest on the Class A-1A Certificates will be calculated
on the basis of the actual number of days in the related Interest Accrual Period
and a 360-day year.
Many of the defined terms listed below may apply to both Loan Groups
and are sometimes used in this Agreement to refer to a particular Loan Group by
the adjectival use of the words "Group 1" and "Group 2."
"1933 Act": The Securities Act of 1933, as amended.
"60+ Day Delinquent Loan": Each Mortgage Loan with respect to which
any portion of a Monthly Payment is, as of the last day of the prior Collection
Period, two months or more past due (without giving effect to any grace period),
each Mortgage Loan in foreclosure, all REO Property and each Mortgage Loan for
which the Mortgagor has filed for bankruptcy after the Closing Date.
"Account": Any of the Collection Account, and Distribution Account.
"Accrued Certificate Interest": With respect to each Distribution
Date and Class of Certificates, an amount equal to the interest accrued at the
applicable rate set forth or described opposite such Class in the table in the
Preliminary Statement during the related Interest Accrual Period on the
Certificate Principal Balance (or Notional Amount) of such Class of
Certificates, reduced by such Class's Interest Percentage of Relief Act Interest
Shortfalls for such Distribution Date.
"Actuarial Mortgage Loan": Any Mortgage Loan other than a Simple
Interest Mortgage Loan.
"Advance": As to any Actuarial Mortgage Loan, any advance made by
the Servicer in respect of any Distribution Date pursuant to Section 4.07.
"Adverse REMIC Event": As defined in Section 9.01(f) hereof.
"Affiliate": With respect to any Person, any other Person
controlling, controlled by or under common control with such Person. For
purposes of this definition, "control" means the power to direct the management
and policies of a Person, directly or indirectly, whether through ownership of
voting securities, by contract or otherwise and "controlling" and "controlled"
shall have meanings correlative to the foregoing.
"Agreement": This Pooling and Servicing Agreement and all amendments
and supplements hereto.
"Applicable Regulations": As to any Mortgage Loan, all federal,
state and local laws, statutes, rules and regulations applicable thereto.
"Applied Realized Loss Amount": With respect to each Distribution
Date, the excess, if any, of (a) the aggregate of the Certificate Principal
Balances of the Certificates (after giving effect to all distributions on such
Distribution Date) over (b) the Pool Balance as of the end of the related
Collection Period.
"Assignment": An assignment of Mortgage, notice of transfer or
equivalent instrument, in recordable form, which is sufficient under the laws of
the jurisdiction wherein the related Mortgaged Property is located to reflect of
record the sale of the Mortgage.
"Assumed Final Maturity Date": As to each Class of Certificates, the
date set forth as such in the Preliminary Statement.
"Available Funds": As to any Distribution Date, an amount equal to
the excess of (i) the sum of (a) the aggregate of the Monthly Payments due on
the related Due Date and received by the Trustee one Business Day prior to the
related Distribution Date, (b) Liquidation Proceeds, Insurance Proceeds,
Principal Prepayments, Substitution Adjustment Amounts, the Purchase Price for
any repurchased Mortgage Loan, the Termination Price with respect to the
termination of the Trust pursuant to Section 10.01 hereof and other unscheduled
recoveries of principal and interest (excluding prepayment penalties) in respect
of the Mortgage Loans during the related Prepayment Period, (c) the aggregate of
any amounts received in respect of an REO Property withdrawn from any REO
Account and deposited in the Collection Account for such Distribution Date, (d)
any Compensating Interest for such Distribution Date, and (e) the aggregate of
any Advances made by the Servicer for such Distribution Date over (ii) the sum
of (a) amounts reimbursable or payable to the Servicer pursuant to Section 3.05,
(b) Stayed Funds, (c) the PMI Fee, (d) the Servicing Fee and (e) amounts
deposited in the Collection Account or the Distribution Account, as the case may
be, in error.
"Balloon Mortgage Loan": A Mortgage Loan that provides for the
payment of the unamortized principal balance of such Mortgage Loan in a single
payment at the maturity of such Mortgage Loan that is substantially greater than
the preceding monthly payment.
"Balloon Payment": A payment of the unamortized principal balance of
a Mortgage Loan in a single payment at the maturity of such Mortgage Loan that
is substantially greater than the preceding Monthly Payment.
"Bankruptcy Code": Title 11 of the United States Code, as amended.
"Book-Entry Certificates": Any of the Certificates that shall be
registered in the name of the Depository or its nominee, the ownership of which
is reflected on the books of the Depository or on the books of a Person
maintaining an account with the Depository (directly, as a "Depository
Participant", or indirectly, as an indirect participant in accordance with the
rules of the Depository and as described in Section 5.02 hereof). On the Closing
Date, the Class A-1A, Class A-1F, Class A-2F, Class M-1, Class M-2 and Class B
Certificates shall be Book-Entry Certificates.
"Business Day": Any day other than a Saturday, a Sunday or a day on
which banking institutions in the State of Delaware or the State of New York or
in the city in which the Corporate Trust Office of the Trustee is located are
authorized or obligated by law or executive order to be closed.
"Certificate": Any Regular Certificate or Class R Certificate.
"Certificate Custodian": Initially, The Chase Manhattan Bank;
thereafter any other Certificate Custodian acceptable to the Depository and
selected by the Trustee.
"Certificateholder" or "Holder": The Person in whose name a
Certificate is registered in the Certificate Register, except that a
Disqualified Organization or non-U.S. Person shall not be a Holder of a Class R
Certificate for any purpose hereof.
"Certificate Owner": With respect to each Book-Entry Certificate,
any beneficial owner thereof.
"Certificate Principal Balance": With respect to any Class of
Certificates (other than the Class BB, Class X and Class R Certificates) and any
Distribution Date, will be equal to the Original Class Certificate Principal
Balance reduced by the sum of (i) all amounts actually distributed in respect of
principal of such Class on all prior Distribution Dates and (ii) Applied
Realized Loss Amounts allocated thereto. The Class BB, Class X and Class R
Certificates do not have a Certificate Principal Balance.
"Certificate Register" and "Certificate Registrar": The register
maintained and registrar appointed pursuant to Section 5.02 hereof.
"Class": Collectively, Certificates which have the same priority of
payment and bear the same class designation and the form of which is identical
except for variation in the Percentage Interest evidenced thereby.
"Class A-1A Certificate Margin": For each Distribution Date (i) on
or prior to the Optional Termination Date, 0.20% per annum, and (ii) following
the Optional Termination Date, 0.40% per annum.
"Class A-1A Pass-Through Rate": For any Distribution Date, LIBOR as
of the related LIBOR Determination Date, plus the Class A-1A Certificate Margin.
"Class A-1F Pass-Through Rate": For each Distribution Date (i) on or
prior to the Optional Termination Date, 7.570% per annum, and (ii) following the
Optional Termination Date, 8.070% per annum.
"Class A-2F Pass-Through Rate": For each Distribution Date (i) on or
prior to the Optional Termination Date, 7.641% per annum, and (ii) following the
Optional Termination Date, 8.141% per annum.
"Class A Certificate": Any one of the Certificates with an "A"
designated on the face thereof substantially in the form annexed hereto as
Exhibits A-1, A-2 and A-3, executed by the Trustee on behalf of the Trust and
authenticated and delivered by the Trustee, representing the right to
distributions as set forth herein and therein.
"Class A Certificateholders": Collectively, the Holders of the Class
A Certificates.
"Class A Interest Carry Forward Amount": For any Distribution Date,
the sum of the Interest Carry Forward Amount for the Class A-1A, Class A-1F and
Class A-2F Certificates for such Distribution Date.
"Class A Principal Distribution Amount": As of any Distribution Date
(a) prior to the Stepdown Date or with respect to which a Trigger Event is in
effect, the lesser of (i) 100% of the Principal Distribution Amount and (ii) the
sum of the Certificate Principal Balances of the Class A-1A, Class A-1F and
Class A-2F Certificates and (b) on or after the Stepdown Date and as long as a
Trigger Event is not in effect, the excess of (x) the sum of the Certificate
Principal Balances of the Class A-1A, Class A-1F and Class A-2F Certificates
immediately prior to such Distribution Date over (y) the lesser of (A) the
product of (i) 60% and (ii) the Pool Balance as of the last day of the related
Collection Period and (B) the Pool Balance as of the last day of the related
Collection Period minus the product of (i) 0.50% and (ii) the Pool Balance on
the Closing Date.
"Class B Applied Realized Loss Amount": As to the Class B
Certificates and as of any Distribution Date, the lesser of (x) the Certificate
Principal Balance thereof (after taking into account the distribution of the
Principal Distribution Amount on such Distribution Date, but prior to the
application of the Applied Realized Loss Amount, if any, on such Distribution
Date) and (y) the Applied Realized Loss Amount as of such Distribution Date.
"Class B Certificate": Any one of the Certificates with a "B"
designated on the face thereof substantially in the form annexed hereto as
Exhibit B, executed by the Trustee on behalf of the Trust and authenticated and
delivered by the Trustee, representing the right to distributions as set forth
herein and therein.
"Class B Certificateholder": Any Holder of a Class B Certificate.
"Class B Pass-Through Rate": For each Distribution Date, 8.650%, per
annum.
"Class B Principal Distribution Amount": As of any Distribution Date
on or after the Stepdown Date and as long as a Trigger Event is not in effect,
the excess of (x) the sum of (i) the sum of the Certificate Principal Balances
of the Class A-1A, Class A-1F and Class A-2F Certificates (after taking into
account the payment of the Class A Principal Distribution Amount on such
Distribution Date), (ii) the Certificate Principal Balance of the Class M-1
Certificates (after taking into account the payment of the Class M-1 Principal
Distribution Amount on such Distribution Date), (iii) the Certificate Principal
Balance of the Class M-2 Certificates (after taking into account the payment of
the Class M-2 Principal Distribution Amount on such Distribution Date), and (iv)
the Certificate Principal Balance of the Class B Certificates immediately prior
to such Distribution Date over (y) the lesser of (A) the product of (i) 92.50%
and (ii) the Pool Balance as of the last day of the related Collection Period
and (B) the Pool Balance as of the last day of the related Collection Period
minus the product of 0.50% and the Pool Balance on the Closing Date.
"Class B Realized Loss Amortization Amount": As to the Class B
Certificates and as of any Distribution Date, the lesser of (x) the Unpaid
Realized Loss Amount for the Class B Certificates as of such Distribution Date
and (y) the excess of (i) the Monthly Excess Cashflow Amount over (ii) the sum
of the amounts described in Section 4.02(b)(i) through (xi) hereof, in each case
for such Distribution Date.
"Class BB Certificate": Any one of the Certificates with a "BB"
designated on the face thereof substantially in the form annexed hereto as
Exhibit C-5, executed by the Trustee on behalf of the Trust and authenticated
and delivered by the Trustee, representing the right to distributions as set
forth herein and therein.
"Class BB Reserve Fund": The separate account, held in trust,
created and maintained by the Trustee pursuant to Section 4.08 in the name of
the Trustee for the benefit of the Class BB Certificateholders and designated
"The Chase Manhattan Bank in trust for registered Holders of Asset Backed
Funding Trust 1999-1, Asset Backed Funding Certificates, Series 1999-1, Class
BB."
"Class M-1 Applied Realized Loss Amount": As to the Class M-1
Certificates and as of any Distribution Date, the lesser of (x) the Certificate
Principal Balance thereof (after taking into account the distribution of the
Principal Distribution Amount on such Distribution Date, but prior to the
application of the Class M-1 Applied Realized Loss Amount, if any, on such
Distribution Date) and (y) the excess of (i) the Applied Realized Loss Amount as
of such Distribution Date over (ii) the sum of the Class M-2 Applied Realized
Loss Amount and the Class B Applied Realized Loss Amount, in each case as of
such Distribution Date.
"Class M-1 Pass-Through Rate": For each Distribution Date, 8.390%
per annum.
"Class M-1 Principal Distribution Amount": As of any Distribution
Date on or after the Stepdown Date and as long as a Trigger Event is not in
effect, the excess of (x) the sum of (i) the Certificate Principal Balances of
the Class A-1A, Class A-1F and Class A-2F Certificates (after taking into
account the payment of the Class A Principal Distribution Amount on such
Distribution Date) and (ii) the Certificate Principal Balance of the Class M-1
Certificates immediately prior to such Distribution Date over (y) the lesser of
(A) the product of (i) 74% and (ii) the Pool Balance as of the last day of the
related Collection Period and (B) the Pool Balance as of the last day of the
related Collection Period minus the product of 0.50% and the Pool Balance on the
Closing Date.
"Class M-1 Realized Loss Amortization Amount": As to the Class M-1
Certificates and as of any Distribution Date, the lesser of (x) the Unpaid
Realized Loss Amount for the Class M-1 Certificates as of such Distribution Date
and (y) the excess of (i) the Monthly Excess Cashflow Amount over (ii) the sum
of the amounts described in Section 4.02(b)(i) through (v) hereof, in each case
for such Distribution Date.
"Class M-2 Applied Realized Loss Amount": As to the Class M-2
Certificates and as of any Distribution Date, the lesser of (x) the Certificate
Principal Balance thereof (after taking into account the distribution of the
Principal Distribution Amount on such Distribution Date, but prior to the
application of the Class M-2 Applied Realized Loss Amount, if any, on such
Distribution Date) and (y) the excess of (i) the related Applied Realized Loss
Amount as of such Distribution Date over (ii) the Class B Applied Realized Loss
Amount as of such Distribution Date.
"Class M-2 Pass-Through Rate": For each Distribution Date, 8.650%
per annum.
"Class M-2 Principal Distribution Amount": As of any Distribution
Date on or after the Stepdown Date and as long as a Trigger Event is not in
effect, the excess of (x) the sum of (i) the Certificate Principal Balances of
the Class A-1A, Class A-1F and Class A-2F Certificates (after taking into
account the payment of the Class A Principal Distribution Amount on such
Distribution Date), (ii) the Certificate Principal Balance of the Class M-1
Certificates (after taking into account the payment of the Class M-1 Principal
Distribution Amount on such Distribution Date) and (iii) the Certificate
Principal Balance of the Class M-2 Certificates immediately prior to such
Distribution Date over (y) the lesser of (A) the product of (i) 84% and (ii) the
Pool Balance as of the last day of the related Collection Period and (B) the
Pool Balance as of the last day of the related Collection Period minus the
product of 0.50% and the Pool Balance on the Closing Date.
"Class M-2 Realized Loss Amortization Amount": As to the Class M-2
Certificates and as of any Distribution Date, the lesser of (x) the Unpaid
Realized Loss Amount for the Class M-2 Certificates as of such Distribution Date
and (y) the excess of (i) the Monthly Excess Cashflow Amount over (ii) the sum
of the amounts described in Section 4.02(b)(i) through (viii) hereof, in each
case for such Distribution Date.
"Class R Certificate": The Class R Certificate executed by the
Trustee on behalf of the Trust, and authenticated and delivered by the
Certificate Registrar, substantially in the form annexed hereto as Exhibit C-1
and evidencing the ownership of the Residual Interest. The Class R Certificate
represents the ownership of the Class R-1 Interest, Class R-2 Interest, Class
R-3 Interest and Class R-4 Interest.
"Class R-1 Interest": The uncertificated residual interest in REMIC
1.
"Class R-2 Interest": The uncertificated residual interest in REMIC
2.
"Class R-3 Interest": The uncertificated residual interest in REMIC
3.
"Class R-4 Interest": The uncertificated residual interest in REMIC
4.
"Class T1-1 Interest": A regular interest in REMIC 1 that is held as
an asset of REMIC 2 and has a principal balance equal to the Class T1-1
Principal Amount and bears interest at the Weighted Average Net Mortgage Rate.
"Class T1-1 Principal Amount": As of any Distribution Date, after
the application of principal payments and Applied Realized Loss Amounts, an
amount equal to 98% of (a) the aggregate Principal Balance of the Mortgage Loans
minus (b) the Class T1-4 Principal Amount.
"Class T1-2 Interest": A regular interest in REMIC 1 that is held as
an asset of REMIC 2 and has a principal balance equal to the Class T1-2
Principal Amount and bears interest at the Weighted Average Net Mortgage Rate.
"Class T1-2 Principal Amount": As of any Distribution Date, after
the application of principal payments and Applied Realized Loss Amounts, an
amount equal to 1% of the excess of (a) the excess of (i) the aggregate
Principal Balance of the Mortgage Loans over (ii) the Subsequent
Overcollateralization Amount over (b) the Class T1-4 Principal Amount.
"Class T1-3 Interest": A regular interest in REMIC 1 that is held as
an asset of REMIC 2 and has a principal balance equal to the Class T1-3
Principal Amount and bears interest at the Weighted Average Net Mortgage Rate.
"Class T1-3 Principal Amount": As of any Distribution Date, after
the application of principal payments and Applied Realized Loss Amounts, an
amount equal to 1% of (a) the sum of (i) the aggregate Principal Balance of the
Mortgage Loans and (ii) the Subsequent Overcollateralization Amount minus (b)
the Class T1-4 Principal Amount.
"Class T1-4 Interest": A regular interest in REMIC 1 that is held as
an asset of REMIC 2 and has a principal balance equal to the Class T1-4
Principal Amount and bears interest at the Weighted Average Net Mortgage Rate.
"Class T1-4 Principal Amount": As of any Distribution Date, an
amount equal to (a) the Initial Overcollateralization Amount minus (b) the sum
of (i) any principal payments and (ii) Realized Losses allocated to the Class
T1-4 Interest as set forth in Section 4.09(d). The Class T1-4 Principal Amount
equals the Remaining Overcollateralization Amount.
"Class T2-1 Interest": A regular interest in REMIC 2 that is held as
an asset of REMIC 3 and has a principal balance equal to the Class T1-1
Principal Amount and bears interest at the REMIC 2 Pass-Through Rate.
"Class T2-2 Interest": A regular interest in REMIC 2 that is held as
an asset of REMIC 3 and has a principal balance equal to the Class T1-2
Principal Amount and bears interest at the REMIC 2 Pass-Through Rate.
"Class T2-3 Interest": A regular interest in REMIC 2 that is held as
an asset of REMIC 3 and has a principal balance equal to the Class T1-3
Principal Amount and bears interest at the REMIC 2 Pass-Through Rate.
"Class T2-4 Interest": A regular interest in REMIC 2 that is held as
an asset of REMIC 3 and has a principal balance equal to the Class T1-4
Principal Amount and bears interest at the Weighted Average Net Mortgage Rate.
"Class T2-5 Interest": A regular interest in REMIC 2 that is held as
an asset of REMIC 3 and has a notional balance equal to the Class T1-1 Principal
Amount and bears interest at (a) the Weighted Average Net Mortgage Rate minus
(b) the REMIC 2 Pass-Through Rate.
"Class T2-6 Interest": A regular interest in REMIC 2 that is held as
an asset of REMIC 3 and has a notional balance equal to the Class T1-2 Principal
Amount and bears interest at (a) the Weighted Average Net Mortgage Rate minus
(b) the REMIC 2 Pass-Through Rate.
"Class T2-7 Interest": A regular interest in REMIC 2 that is held as
an asset of REMIC 3 and has a notional balance equal to the Class T1-3 Principal
Amount and bears interest at (a) the Weighted Average Net Mortgage Rate minus
(b) the REMIC 2 Pass-Through Rate.
"Class T3-A1A Interest": A regular interest in REMIC 3 that is held
as an asset of REMIC 4 and has a principal balance equal to the Certificate
Principal Balance of the Class A-1A Certificates and bears interest at the
Maximum Rate as set forth in the first sentence of the definition thereof.
"Class T3-A1F Interest": A regular interest in REMIC 3 that is held
as an asset of REMIC 4 and has a principal balance equal to the Certificate
Principal Balance of the Class A-1F Certificates and bears interest at the
Weighted Average Net Mortgage Rate.
"Class T3-A2F Interest": A regular interest in REMIC 3 that is held
as an asset of REMIC 4 and has a principal balance equal to the Certificate
Principal Balance of the Class A-2F Certificates and bears interest at the
Weighted Average Net Mortgage Rate.
"Class T3-B Interest": A regular interest in REMIC 3 that is held as
an asset of REMIC 4 and has a principal balance equal to the Certificate
Principal Balance of the Class B Certificates and bears interest at the Weighted
Average Net Mortgage Rate.
"Class T3-M1 Interest": A regular interest in REMIC 3 that is held
as an asset of REMIC 4 and has a principal balance equal to the Certificate
Principal Balance of the Class M-1 Certificates and bears interest at the
Weighted Average Net Mortgage Rate.
"Class T3-M2 Interest": A regular interest in REMIC 3 that is held
as an asset of REMIC 4 and has a principal balance equal to the Certificate
Principal Balance of the Class M-2 Certificates and bears interest at the
Weighted Average Net Mortgage Rate.
"Class T3-4 Interest": A regular interest in REMIC 3 that is held as
an asset of REMIC 4 and has a principal balance equal to the Class T1-4
Principal Amount and bears interest at the Weighted Average Net Mortgage Rate.
"Class T3-5 Interest": A regular interest in REMIC 3 that is held as
an asset of REMIC 4 and has a notional balance equal to the Class T1-1 Principal
Amount and is entitled to all interest distributions on the Class T2-5 Interest.
"Class T3-6 Interest": A regular interest in REMIC 3 that is held as
an asset of REMIC 4 and has a notional balance equal to the Class T1-2 Principal
Amount and is entitled to all interest distributions on the Class T2-6 Interest.
"Class T3-7 Interest": A regular interest in REMIC 3 that is held as
an asset of REMIC 4 and has a notional balance equal to the Class T1-3 Principal
Amount and is entitled to all interest distributions on the Class T2-7 Interest.
"Class T4-A1A Interest": A regular interest in REMIC 4, beneficial
ownership of which is represented by the Class A1A Certificates that has a
principal balance equal to the Certificate Principal Balance of the Class A-1A
Certificates and bears interest at the lesser of the Class A-1A Pass-Through
Rate and Maximum Rate as set forth in the first sentence of the definition
thereof.
"Class T4-4 Interest": A regular interest in REMIC 4, beneficial
ownership of which is represented by the Class X/BB Interest, that has a
principal balance equal to the Class T1-4 Principal Amount and bears interest at
the Weighted Average Net Mortgage Rate.
"Class T4-5 Interest": A regular interest in REMIC 4, beneficial
ownership of which is represented by the Class X/BB Interest, that has a
notional balance equal to the Class T1-1 Principal Amount and is entitled to all
interest distributions on the Class T3-5 Interest.
"Class T4-6 Interest": A regular interest in REMIC 4, beneficial
ownership of which is represented by the Class X/BB Interest, that has a
notional balance equal to the Class T1-2 Principal Amount and is entitled to all
interest distributions on the Class T3-6 Interest.
"Class T4-7 Interest": A regular interest in REMIC 4, which is
represented by the Class X/BB Interest, that has a notional balance equal to the
Class T1-3 Principal Amount and is entitled to all interest distributions on the
Class T3-7 Interest.
"Class T4-11 Interest": A regular interest in REMIC 4, beneficial
ownership of which is represented by the Class X/BB Interest, that has a
notional balance equal to the principal balance of the Class A-1A Certificate
and bears interest at a rate equal to the excess, if any, of (i) the Weighted
Average Net Mortgage Rate over (ii) the Class A-1A Pass-Through Rate.
"Class T4-12 Interest": A regular interest in REMIC 4, beneficial
ownership of which is represented by the Class X/BB Interest, that has a
notional balance equal to the principal balance of the Class A-1F Certificate
and bears interest at a rate equal to the excess, if any of (i) the Weighted
Average Net Mortgage Rate over (ii) the Class A-1F Pass-Through Rate.
"Class T4-13 Interest": A regular interest in REMIC 4, beneficial
ownership of which is represented by the Class X/BB Interest, that has a
notional balance equal to the principal balance of the Class A-2F Certificate
and bears interest at a rate equal to the excess, if any of (i) the Weighted
Average Net Mortgage Rate over (ii) the Class A-2F Pass-Through Rate.
"Class T4-14 Interest": A regular interest in REMIC 4, beneficial
ownership of which is represented by the Class X/BB Interest, that has a
notional balance equal to the principal balance of the Class M-1 Certificates
and bears interest at a rate equal to the excess, if any of (i) the Weighted
Average Net Mortgage Rate over (ii) the Class M-1 Pass-Through Rate.
"Class T4-15 Interest": A regular interest in REMIC 4, beneficial
ownership of which is represented by the Class X/BB Interest, that has a
notional balance equal to the principal balance of the Class M-2 Certificates
and bears interest at a rate equal to the excess, if any of (i) the Weighted
Average Net Mortgage Rate over (ii) the Class M-2 Pass-Through Rate.
"Class T4-16 Interest": A regular interest in REMIC 4, beneficial
ownership of which is represented by the Class X/BB Interest, that has a
notional balance equal to the principal balance of the Class B Certificates and
bears interest at a rate equal to the excess, if any of (i) the Weighted Average
Net Mortgage Rate over (ii) the Class B Pass-Through Rate.
"Class X": Any one of the Class X Certificates as designated on the
face thereof substantially in the form annexed hereto as Exhibit C-3, executed
by the Trustee on behalf of the Trust and authenticated and delivered by the
Trustee, representing the right to distributions as set forth herein and
therein.
"Class X/BB Interest": An uncertificated interest in the Trust held
by the Trustee on behalf of the holders of the Class X and Class BB
Certificates, representing the REMIC 4 Components in the aggregate, and which is
entitled to all distributions in respect of the REMIC 4 Components less the
amount of any LIBOR Carryover Amounts pursuant to Section 4.02(b)(xiii) and
4.02(d).
"Class X Distributable Amount": With respect to any Distribution
Date, the excess of (i) the aggregate of amounts distributable on the Class
T4-4, Class T4-5, Class T4-6, Class T4-7, Class T4-11, Class T4-12, Class T4-13,
Class T4-14, Class T4-15 and Class T4-16 Interests in respect of principal and
interest for such Distribution Date, over (ii) the aggregate of amounts
distributable to the Class BB Certificates pursuant to Section 4.02(b).
"Closing Date": December 21, 1999.
"Code": The Internal Revenue Code of 1986, as it may be amended from
time to time.
"Collection Account": The account or accounts created and maintained
by the Servicer pursuant to Section 3.04, which shall be entitled "Litton Loan
Servicing LP, as Servicer for The Chase Manhattan Bank, as Trustee, in trust for
registered Holders of Asset Backed Funding Trust 1999-1, Asset Backed Funding
Certificates, Series 1999-1", and which must be an Eligible Account.
"Collection Period": With respect to any Distribution Date, the
period from the second day of the calendar month preceding the month in which
such Distribution Date occurs through the first day of the month in which such
Distribution Date occurs.
"Compensating Interest": As defined in Section 3.23 hereof.
"Condemnation Proceeds": All awards or settlements in respect of a
taking of a Mortgaged Property by exercise of the power of eminent domain or
condemnation.
"Corporate Trust Office": The principal corporate trust office of
the Trustee at which at any particular time its corporate trust business in
connection with this Agreement shall be administered, which office at the date
of the execution of this instrument is located at 450 West 33rd Street, 14th
Floor, New York, New York 10001, Attention: Capital Markets Fiduciary Services,
ABFC Series 1999-1, or at such other address as the Trustee may designate from
time to time by notice to the Certificateholders, the Depositor, the Servicer
and the Seller.
"Corresponding Classes": With respect to REMIC 3 and REMIC 4, the
following Classes shall be Corresponding Classes:
- --------------------------------------------------------------------------------
CORRESPONDING REMIC 3 CLASSES CORRESPONDING REMIC 4 CLASSES
T3-A1A T4-A1A and T4-11, in the aggregate
T3-A1F A-1F and T4-12, in the aggregate
T3-A2F A-2F and T4-13, in the aggregate
T3-M1 M-1 and T4-14, in the aggregate
T3-M2 M-2 and T4-15, in the aggregate
T3-B B and T4-16, in the aggregate
"Custodial Agreement": The Custodial Agreement, dated as of November
1, 1999, among the Trustee, the Servicer and the Custodian, as the same may be
amended or supplemented pursuant to the terms thereof.
"Custodian": Bank One Trust Company, N.A., a national banking
association, or any successor custodian appointed pursuant to the terms of the
Custodial Agreement.
"Cut-off Date": November 1, 1999.
"Cut-off Date Aggregate Principal Balance": The aggregate of the
Cut-off Date Principal Balances of the Mortgage Loans.
"Cut-off Date Principal Balance": With respect to any Mortgage Loan,
the unpaid principal balance thereof as of the Cut-off Date after application of
funds due on or before such date (or as of the applicable date of substitution
with respect to an Eligible Substitute Mortgage Loan).
"DCR": Duff & Phelps Credit Rating Co. and its successors, and if
such company shall for any reason no longer perform the functions of a
securities rating agency, "DCR" shall be deemed to refer to any other
"nationally recognized statistical rating organization" as set forth on the most
current list of such organizations released by the Securities and Exchange
Commission.
"Debt Service Reduction": With respect to any Mortgage Loan, a
reduction in the scheduled Monthly Payment for such Mortgage Loan by a court of
competent jurisdiction in a proceeding under the Bankruptcy Code, except such a
reduction resulting from a Deficient Valuation.
"Defective Mortgage Loan": A Mortgage Loan replaced or to be
replaced by one or more Eligible Substitute Mortgage Loans.
"Deficient Valuation": With respect to any Mortgage Loan, a
valuation of the related Mortgaged Property by a court of competent jurisdiction
in an amount less than the then outstanding principal balance of the Mortgage
Loan, which valuation results from a proceeding initiated under the Bankruptcy
Code.
"Definitive Certificates": As defined in Section 5.02(c) hereof.
"Delinquent": Any Mortgage Loan, the Monthly Payment due on a Due
Date with respect to which such monthly payment is not made by the close of
business on the next scheduled Due Date for such Mortgage Loan.
"Depositor": Asset Backed Funding Corporation, a Delaware
corporation, or any successor in interest.
"Depository": The initial depository shall be The Depository Trust
Company, whose nominee is Cede & Co., or any other organization registered as a
"clearing agency" pursuant to Section 17A of the Securities Exchange Act of
1934, as amended. The Depository shall initially be 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 Agreement": With respect to any Book-Entry Certificates,
the agreement among the Depositor, the Trustee and the initial Depository, to be
dated on or about the Closing Date.
"Depository Participant": A broker, dealer, bank or other financial
institution or other person for whom from time to time a Depository effects
book-entry transfers and pledges of securities deposited with the Depository.
"Determination Date": With respect to any Distribution Date, other
than the Distribution Date in December 1999, the 10th day of the calendar month
in which such Distribution Date occurs or, if such 10th day is not a Business
Day, the Business Day immediately preceding such 10th day; with respect to the
Distribution Date in December 1999, December 15, 1999.
"Directly Operate": With respect to any REO Property, the furnishing
or rendering of services to the tenants thereof, the management or operation of
such REO Property, the holding of such REO Property primarily for sale to
customers, the performance of any construction work thereon or any use of such
REO Property in a trade or business conducted by the Trust other than through an
Independent Contractor; provided, however, that the Trustee (or the Servicer on
behalf of the Trustee) shall not be considered to Directly Operate an REO
Property solely because the Trustee (or the Servicer on behalf of the Trustee)
establishes rental terms, chooses tenants, enters into or renews leases, deals
with taxes and insurance, or makes decisions as to repairs or capital
expenditures with respect to such REO Property.
"Disqualified Organization": A "disqualified organization" under
Section 860E of the Code, which as of the Closing Date is any of: (i) the United
States, any state or political subdivision thereof, any possession of the United
States, any foreign government, any international organization, or any agency or
instrumentality of any of the foregoing, (ii) any organization (other than a
cooperative described in Section 521 of the Code) which is exempt from the tax
imposed by Chapter 1 of the Code unless such organization is subject to the tax
imposed by Section 511 of the Code, (iii) any organization described in Section
1381(a)(2)(C) of the Code, or (iv) any other Person so designated by the Trustee
based upon an Opinion of Counsel provided by nationally recognized counsel to
the Trustee that the holding of an ownership interest in a Class R Certificate
by such Person may cause the Trust Fund or any Person having an ownership
interest in any Class of Certificates (other than such Person) to incur
liability for any federal tax imposed under the Code that would not otherwise be
imposed but for the transfer of an ownership interest in the Class R Certificate
to such Person. A corporation will not be treated as an instrumentality of the
United States or of any state or political subdivision thereof if all of its
activities are subject to tax and a majority of its board of directors is not
selected by a governmental unit. The term "United States", "state" and
"international organization" shall have the meanings set forth in Section 7701
of the Code.
"Distribution Account": The trust account or accounts created and
maintained by the Trustee pursuant to Section 3.04(b) which shall be entitled
"Distribution Account, The Chase Manhattan Bank, as Trustee, in trust for the
registered Holders of Asset Backed Funding Trust 1999-1, Asset Backed Funding
Certificates, Series 1999-1" and which must be an Eligible Account.
"Distribution Date": The 25th day of any calendar month, or if such
25th day is not a Business Day, the Business Day immediately following such 25th
day, commencing in December 1999.
"Due Date": With respect to each Mortgage Loan and any Distribution
Date, the first day of the calendar month in which such Distribution Date occurs
on which the Monthly Payment for such Mortgage Loan was due, exclusive of any
grace period.
"Eligible Account": Any of (i) an account or accounts maintained
with a federal or state chartered depository institution or trust company the
short-term unsecured debt obligations of which (or, in the case of a depository
institution or trust company that is the principal subsidiary of a holding
company, the short-term unsecured debt obligations of such holding company) are
rated "A-1" (or the equivalent) by each of the Rating Agencies at the time any
amounts are held on deposit therein, (ii) an account or accounts the deposits in
which are fully insured by the FDIC (to the limits established by such
corporation), the uninsured deposits in which account are otherwise secured such
that, as evidenced by an Opinion of Counsel delivered to the Trustee and to each
Rating Agency, the Certificateholders will have a claim with respect to the
funds in such account or a perfected first priority security interest against
such collateral (which shall be limited to Permitted Investments) securing such
funds that is superior to claims of any other depositors or creditors of the
depository institution with which such account is maintained, (iii) a trust
account or accounts maintained with the trust department of a federal or state
chartered depository institution, national banking association or trust company
acting in its fiduciary capacity or (iv) an account otherwise acceptable to each
Rating Agency without reduction or withdrawal of their then current ratings of
the Certificates as evidenced by a letter from each Rating Agency to the
Trustee. Eligible Accounts may bear interest.
"Eligible Substitute Mortgage Loan": A mortgage loan substituted for
a Defective Mortgage Loan pursuant to the terms of this Agreement which must, on
the date of such substitution, (i) have an outstanding principal balance, after
application of all scheduled payments of principal and interest due during or
prior to the month of substitution, not in excess of, and not more than 5% less
than, the outstanding principal balance of the Defective Mortgage Loan as of the
Due Date in the calendar month during which the substitution occurs, (ii) have a
Mortgage Interest Rate, not less than the Mortgage Interest Rate of the
Defective Mortgage Loan and not more than 1% in excess of the Mortgage Interest
Rate of such Defective Mortgage Loan, (iii) have the same Due Date as the
Defective Mortgage Loan, (iv) have a remaining term to maturity not more than
one year earlier and not later than the remaining term to maturity of the
Defective Mortgage Loan, (v) be current as of the date of substitution, (vi)
have a Loan-to-Value Ratio as of the date of substitution equal to or lower than
the Loan-to-Value Ratio of the Defective Mortgage Loan as of such date, (vii)
have a risk grading determined by the Seller at least equal to the risk grading
assigned on the Defective Mortgage Loan, (viii) have been underwritten or
re-underwritten in accordance with the same underwriting criteria and guidelines
as the Defective Mortgage Loan and (ix) conform to each representation and
warranty set forth in Section 2.04 hereof and be a Seller Mortgage Loan for
purposes of the Mortgage Loan Purchase Agreement. In the event that one or more
mortgage loans are substituted for one or more Defective Mortgage Loans, the
amounts described in clause (i) hereof shall be determined on the basis of
aggregate principal balances, the Mortgage Interest Rates described in clause
(ii) hereof shall be determined on the basis of weighted average Mortgage
Interest Rates, the terms described in clause (iv) hereof shall be determined on
the basis of weighted average remaining term to maturity, the Loan-to-Value
Ratios described in clause (vi) hereof shall be satisfied as to each such
mortgage loan, the risk gradings described in clause (vii) hereof shall be
satisfied as to each such mortgage loan, and, except to the extent otherwise
provided in this sentence, the representations and warranties described in
clause (ix) hereof must be satisfied as to each Eligible Substitute Mortgage
Loan or in the aggregate, as the case may be.
"ERISA": The Employee Retirement Income Security Act of 1974, as
amended.
"ERISA-Restricted Certificates": Any of the Class M-1, Class M-2,
Class B, Class BB, Class X and Class R Certificates.
"Escrow Account": The account or accounts created and maintained
pursuant to Section 3.06.
"Escrow Payments": The amounts constituting ground rents, taxes,
assessments, water rates, mortgage insurance premiums, fire and hazard insurance
premiums and other payments required to be escrowed by the Mortgagor with the
mortgagee pursuant to any Mortgage Loan.
"Estate in Real Property": A fee simple estate in a parcel of real
property.
"Expense Fee Rate": The sum of (i) the Trustee Fee Rate, (ii) the
Servicing Fee Rate and (iii) with respect to PMI Mortgage Loans, the PMI Fee
Rate.
"Extra Principal Distribution Amount": As of any Distribution Date,
the lesser of (x) the Monthly Excess Interest Amount for such Distribution Date
and (y) the Overcollateralization Deficiency for such Distribution Date.
"Extended Period": As defined in Section 9.04(b).
"FDIC": Federal Deposit Insurance Corporation or any successor
thereto.
"FHLMC": Federal Home Loan Mortgage Corporation or any successor
thereto.
"Fidelity Bond": Shall have the meaning assigned thereto in Section
3.12.
"Final Recovery Determination": With respect to any defaulted
Mortgage Loan or any REO Property (other than a Mortgage Loan or REO Property
purchased by the Seller or the Servicer pursuant to or as contemplated by
Section 2.03 or 10.01), a determination made by the Servicer that all Insurance
Proceeds, Liquidation Proceeds and other payments or recoveries which the
Servicer, in its reasonable good faith judgment, expects to be finally
recoverable in respect thereof have been so recovered. The Servicer shall
maintain records, prepared by a Servicing Officer, of each Final Recovery
Determination made thereby.
"First Union": First Union National Bank, or any successor thereto.
"Fitch": "Fitch IBCA, Inc. and its successors, and if such company
shall for any reason no longer perform the functions of a securities rating
agency, "Fitch" shall be deemed to refer to any other "nationally recognized
statistical rating organization" as set forth on the most current list of such
organizations released by the Securities and Exchange Commission.
"FNMA": Fannie Mae or any successor thereto.
"Group 1 Loan Balance": As of any date, the aggregate of the
Principal Balances of all Mortgage Loans in Loan Group 1 as of such date.
"Group 1 Mortgage Loan": A Mortgage Loan in Loan Group 1.
"Group 1 Principal Percentage": With respect to any Distribution
Date and the Class A-1A and Class A-1F Certificates, the percentage equivalent
of a fraction, the numerator of which is the amount of principal collections
(including any principal advanced by the Servicer) allocable to Loan Group 1 for
the related Collection Period or Prepayment Period, as applicable, and the
denominator of which is the amount of principal collections (including any
principal advanced by the Servicer) allocable to Loan Group 1 and Loan Group 2
for the related Collection Period or Prepayment Period, as applicable.
"Group 2 Loan Balance": As of any date, the aggregate of the
Principal Balances of all Mortgage Loans in Loan Group 2 as of such date.
"Group 2 Mortgage Loan": A Mortgage Loan in Loan Group 2.
"Group 2 Principal Percentage": With respect to any Distribution
Date and the Class A-2F Certificates, the percentage equivalent of a fraction,
the numerator of which is the amount of principal collections (including any
principal advanced by the Servicer) allocable to Loan Group 2 for the related
Collection Period or Prepayment Period, as applicable, and the denominator of
which is the amount of principal collections (including any principal advanced
by the Servicer) allocable to Loan Group 1 and Loan Group 2 for the related
Collection Period or Prepayment Period, as applicable.
"Independent": When used with respect to any specified Person, any
such Person who (i) is in fact independent of the Depositor, the Servicer and
their respective Affiliates, (ii) does not have any direct financial interest in
or any material indirect financial interest in the Depositor or the Servicer or
any Affiliate thereof, and (iii) is not connected with the Depositor or the
Servicer or any Affiliate thereof as an officer, employee, promoter,
underwriter, trustee, partner, director or Person performing similar functions;
provided, however, that a Person shall not fail to be Independent of the
Depositor or the Servicer or any Affiliate thereof merely because such Person is
the beneficial owner of 1% or less of any Class of securities issued by the
Depositor or the Servicer or any Affiliate thereof, as the case may be.
"Independent Contractor": Either (i) any Person (other than the
Servicer) that would be an "independent contractor" with respect to the Trust
Fund within the meaning of Section 856(d)(3) of the Code if the Trust Fund were
a real estate investment trust (except that the ownership tests set forth in
that section shall be considered to be met by any Person that owns, directly or
indirectly, 35 percent or more of any Class of Certificates), so long as the
Trust Fund does not receive or derive any income from such Person and provided
that the relationship between such Person and the Trust Fund is at arm's length,
all within the meaning of Treasury Regulations Section 1.856-4(b)(5), or (ii)
any other Person (including the Servicer) if the Trustee has received an Opinion
of Counsel, which Opinion of Counsel shall be an expense of the Trust Fund, to
the effect that the taking of any action in respect of any REO Property by such
Person, subject to any conditions therein specified, that is otherwise herein
contemplated to be taken by an Independent Contractor will not cause such REO
Property to cease to qualify as "foreclosure property" within the meaning of
Section 860G(a)(8) of the Code (determined without regard to the exception
applicable for purposes of Section 860D(a) of the Code), or cause any income
realized in respect of such REO Property to fail to qualify as Rents from Real
Property.
"Initial Certificate Principal Balance": With respect to any
Certificate of a Class other than a Class BB, Class X or Class R Certificate,
the amount designated "Initial Certificate Principal Balance" on the face
thereof.
"Initial Notional Amount": With respect to any Class BB Certificate,
the amount designated "Initial Notional Amount" on the face thereof.
"Initial Overcollateralization Amount": $4,897,778.33.
"Insurance Proceeds": Proceeds of any title policy, hazard policy or
other insurance policy covering a Mortgage Loan, to the extent such proceeds are
not to be applied to the restoration of the related Mortgaged Property or
released to the Mortgagor in accordance with the procedures that the Servicer
would follow in servicing mortgage loans held for its own account, subject to
the terms and conditions of the related Mortgage Note and Mortgage.
"Interest Accrual Period": With respect to any Distribution Date and
(i) with respect to the Class A-1F, Class A-2F, Class M-1, Class M-2, Class B
and Class BB Certificates, the calendar month immediately preceding the month in
which such Distribution Date occurs, and (ii) with respect to the Class A-1A
Certificates, the period from the preceding Distribution Date to the day prior
to the current Distribution Date (or, in the case of the first Distribution
Date, the period from the Closing Date to December 26, 1999).
"Interest Carry Forward Amount": For any Class of Certificates
(other than the Class X and Class R Certificates) and any Distribution Date, the
sum of (a) the excess, if any, of the Accrued Certificate Interest and any
Interest Carry Forward Amount for the prior Distribution Date, over the amount
in respect of interest actually distributed on such Class on such prior
Distribution Date and (b) interest on such excess at the applicable Pass-Through
Rate (x) with respect to the Class A-1F, Class A-2F, Class M-1, Class M-2, Class
B and Class BB Certificates, on the basis of a 360-day year consisting of twelve
30-day months, and (y) with respect to the Class A-1A Certificates, for the
actual number of days elapsed since the prior Distribution Date.
"Interest Percentage": With respect to any Class of Certificates and
any Distribution Date, the ratio (expressed as a decimal carried to six places)
of the Accrued Certificate Interest for such Class to the sum of the Accrued
Certificate Interests for all Classes, in each case with respect to such
Distribution Date.
"Interest Remittance Amount": As of any Determination Date, the sum,
without duplication, of (i) all interest due and collected or advanced with
respect to the related Collection Period on the Mortgage Loans (less the
Servicing Fee, amounts available for reimbursement of Monthly Advances and
Servicing Advances pursuant to Section 3.05 and expenses reimbursable pursuant
to Section 6.03), (ii) all Compensating Interest paid by the Servicer on such
Determination Date with respect to the Mortgage Loans and (iii) the portion of
any payment in connection with any substitution, Purchase Price, Termination
Price or Net Liquidation Proceeds relating to interest with respect to the
Mortgage Loans received during the related Prepayment Period.
"Late Collections": With respect to any Mortgage Loan, all amounts
received subsequent to the Determination Date immediately following any related
Collection Period, whether as late payments of Monthly Payments or as Insurance
Proceeds, Liquidation Proceeds or otherwise, which represent late payments or
collections of principal and/or interest due (without regard to any acceleration
of payments under the related Mortgage and Mortgage Note) but delinquent on a
contractual basis for such Collection Period and not previously recovered.
"LIBOR": With respect to each Interest Accrual Period, the rate
determined by the Trustee on the related LIBOR Determination Date on the basis
of the offered rate for one-month United States dollar deposits, as such rate
appears on the Telerate Page 3750, as of 11:00 a.m. (London time) on such LIBOR
Determination Date. If no such quotations are available on an LIBOR
Determination Date, LIBOR for the related Interest Accrual Period will be
established by the Trustee as follows:
(i) If on such LIBOR Determination Date two or more Reference Banks
provide such offered quotations, LIBOR for the related Interest Accrual
Period shall be the arithmetic mean of such offered quotations (rounded
upwards if necessary to the nearest whole multiple of 0.001%);
(ii) If on such LIBOR Determination Date fewer than two Reference
Banks provide such offered quotations, LIBOR for the related Interest
Accrual Period shall be the arithmetic mean of the rates quoted by one or
more major banks in New York City, selected by the Trustee after
consultation with the Servicer, as of 11:00 A.M., New York City time, on
such date for loans in U.S. Dollars to leading European banks for a period
of one month in amounts approximately equal to the Certificate Principal
Balance of the Class A-1A Certificates; and
(iii) If no such quotations can be obtained, LIBOR for the related
Interest Accrual Period shall be LIBOR for the prior Distribution Date.
"LIBOR Business Day": Any day on which banks in London, England and
The City of New York are open and conducting transactions in foreign currency
and exchange.
"LIBOR Carryover Amount": If on any Distribution Date, the Accrued
Certificate Interest for the Class A-1A Certificates is based upon the related
Maximum Rate, the excess of (i) the amount of interest the Class A-1A
Certificates would have been entitled to receive on such Distribution Date based
on the Class A-1A Pass-Through Rate, over (ii) the amount of interest the Class
A-1A Certificates received on such Distribution Date based on such Maximum Rate,
together with the unpaid portion of any such excess from prior Distribution
Dates (and interest accrued thereon at the then applicable Class A-1A
Pass-Through Rate).
"LIBOR Determination Date": With respect to the Class A-1A
Certificates, (i) for the first Distribution Date, the second LIBOR Business Day
preceding the Closing Date and (ii) for each subsequent Distribution Date, the
second LIBOR Business Day prior to the immediately preceding Distribution Date.
"Liquidated Mortgage Loan": As to any Distribution Date, any
Mortgage Loan in respect of which the Servicer has determined, in accordance
with the servicing procedures specified herein, as of the end of the related
Prepayment Period, that all Liquidation Proceeds and Insurance Proceeds which it
expects to recover with respect to the liquidation of the Mortgage Loan or
disposition of the related REO Property have been recovered.
"Liquidation Event": With respect to any Mortgage Loan, any of the
following events: (i) such Mortgage Loan is paid in full; (ii) a Final Recovery
Determination is made as to such Mortgage Loan; or (iii) such Mortgage Loan is
removed from the Trust Fund by reason of its being purchased, sold or replaced
pursuant to or as contemplated by Section 2.03 or Section 10.01. With respect to
any REO Property, either of the following events: (i) a Final Recovery
Determination is made as to such REO Property; or (ii) such REO Property is
removed from the Trust Fund by reason of its being sold or purchased pursuant to
Section 3.13 or Section 10.01.
"Liquidation Proceeds": The amount (other than amounts received in
respect of the rental of any REO Property prior to REO Disposition) received by
the Servicer, including payments received under the PMI Policy, in connection
with (i) the taking of all or a part of a Mortgaged Property by exercise of the
power of eminent domain or condemnation or (ii) the liquidation of a defaulted
Mortgage Loan by means of a trustee's sale, foreclosure sale or otherwise.
"Liquidation Report": The report with respect to a Liquidated
Mortgage Loan in such form and containing such information as is agreed to by
the Servicer and the Trustee.
"Loan-to-Value Ratio": As of any date and Mortgage Loan, the
fraction, expressed as a percentage, the numerator of which is the Principal
Balance of the Mortgage Loan plus the principal balance of any related senior
mortgage loan, and the denominator of which is the Value of the related
Mortgaged Property.
"Loan Group": Either Loan Group 1 or Loan Group 2, as the context
requires.
"Loan Group Balance": Either the Group 1 Loan Balance or the Group 2
Loan Balance, as applicable.
"Loan Group 1": The pool of Mortgage Loans identified in the
Mortgage Loan Schedule as having been assigned to Loan Group 1.
"Loan Group 2": The pool of Mortgage Loans identified in the
Mortgage Loan Schedule as having been assigned to Loan Group 2.
"Losses": As defined in Section 9.03.
"Lost Note Affidavit": With respect to any Mortgage Loan as to which
the original Mortgage Note has been permanently lost or destroyed and has not
been replaced, an affidavit from the Seller certifying that the original
Mortgage Note has been lost, misplaced or destroyed (together with a copy of the
related Mortgage Note and indemnifying the Trust against any loss, cost or
liability resulting from the failure to deliver the original Mortgage Note) in
the form of Exhibit H hereto.
"Majority Certificateholders": The Holders of Certificates
evidencing at least 51% of the Voting Rights.
"Majority Class R Certificateholders": The Holders of Class R
Certificates evidencing at least a 51% Percentage Interest in the Class R
Certificates.
"Maximum Rate": With respect to any Distribution Date and the Class
A-1A Certificates, the average of the Net Mortgage Rates of the Simple Interest
Mortgage Loans and Actuarial Mortgage Loans (each adjusted on the basis of a
360-day year and the actual number of days elapsed) as of the first day of the
month preceding the month of such Distribution Date (or, in the case of the
first Distribution Date, the Cut-off Date), weighted on the basis of the related
Principal Balance of the Mortgage Loans as of such date. With respect to any
Distribution Date and the Offered Certificates (other than the Class A-1A
Certificates), the average of the Net Mortgage Rates of the Simple Interest
Mortgage Loans (adjusted on the basis of a 360-day year consisting of twelve
30-day months) and the Actuarial Mortgage Loans as of the first day of the month
preceding the month of such Distribution Date (or, in the case of the first
Distribution Date, the Cut-off Date), weighted on the basis of the related
Principal Balance of the Mortgage Loans as of such date.
"Monthly Excess Cashflow Amount": The sum of the Monthly Excess
Interest Amount, the Overcollateralization Release Amount and (without
duplication) any portion of the Principal Distribution Amount remaining after
principal distributions on the Offered Certificates.
"Monthly Excess Interest Amount": With respect to each Distribution
Date, the amount, if any, by which the Interest Remittance Amount for such
Distribution Date exceeds the aggregate amount distributed on such Distribution
Date pursuant to paragraphs (i) through (vi) under Section 4.01.
"Monthly Payment": With respect to any Mortgage Loan, the scheduled
monthly payment of principal and interest on such Mortgage Loan which is payable
by the related Mortgagor from time to time under the related Mortgage Note,
determined: (a) after giving effect to (i) any Deficient Valuation and/or Debt
Service Reduction with respect to such Mortgage Loan and (ii) any reduction in
the amount of interest collectible from the related Mortgagor pursuant to the
Relief Act; (b) without giving effect to any extension granted or agreed to by
the Servicer pursuant to Section 3.01; and (c) on the assumption that all other
amounts, if any, due under such Mortgage Loan are paid when due.
"Moody's": Moody's Investors Service, Inc. and its successors, and
if such company shall for any reason no longer perform the functions of a
securities rating agency, "Moody's" shall be deemed to refer to any other
"nationally recognized statistical rating organization" as set forth on the most
current list of such organizations released by the Securities and Exchange
Commission.
"Mortgage": The mortgage, deed of trust or other instrument creating
a first lien on, or first priority security interest in, a Mortgaged Property
securing a Mortgage Note.
"Mortgage File": The mortgage documents listed in Section 2.01
pertaining to a particular Mortgage Loan and any additional documents required
to be added to the Mortgage File pursuant to this Agreement.
"Mortgage Interest Rate": With respect to each Mortgage Loan, the
annual rate at which interest accrues on such Mortgage Loan from time to time in
accordance with the provisions of the related Mortgage Note, which rate shall
remain constant at the rate set forth in the Mortgage Loan Schedule as the
Mortgage Interest Rate in effect immediately following the Cut-off Date. With
respect to each Mortgage Loan that becomes an REO Property, as of any date of
determination, the annual rate determined in accordance with the immediately
preceding sentence as of the date such Mortgage Loan became an REO Property.
"Mortgage Loan": Each mortgage loan transferred and assigned to the
Trustee pursuant to Section 2.01 or Section 2.03(d) as from time to time held as
a part of the Trust Fund, the Mortgage Loans so held being identified in the
Mortgage Loan Schedule.
"Mortgage Loan Purchase Agreement": The agreement between the Seller
and the Depositor, dated as of November 1, 1999, regarding the transfer of the
Mortgage Loans by the Seller to or at the direction of the Depositor.
"Mortgage Loan Schedule": As of any date (i) with respect to the
Originator Mortgage Loans, the list of such Mortgage Loans included in the Trust
Fund on such date, separately identifying the Group 1 Mortgage Loans and the
Group 2 Mortgage Loans, attached hereto as Exhibit D-1 and (ii) with respect to
the Seller Mortgage Loans, the list of such Mortgage Loans included in the Trust
Fund on such date, separately identifying the Group 1 Mortgage Loans and the
Group 2 Mortgage Loans, attached hereto as Exhibit D-2. The Mortgage Loan
Schedule shall be prepared by the Seller and shall set forth the following
information with respect to each Mortgage Loan:
(1) the Seller's Mortgage Loan identifying number;
(2) the city, state, and zip code of the Mortgaged Property;
(3) the type of Residential Dwelling constituting the Mortgaged Property
or a designation that the Mortgaged Property is a multi-family property;
(4) the occupancy status of the Mortgaged Property at origination;
(5) the original months to maturity;
(6) the date of origination;
(7) the first payment date;
(8) the stated maturity date;
(9) the stated remaining months to maturity;
(10) the original principal amount of the Mortgage Loan;
(11) the Principal Balance of each Mortgage Loan as of the Cut-off Date;
(12) the Mortgage Interest Rate of the Mortgage Loan as of the Cut-off
Date;
(13) the current principal and interest payment of the Mortgage Loan as of
the Cut-off Date;
(14) the contractual interest paid to date of the Mortgage Loan;
(15) if the Mortgage Loan is not owner-financed, the Loan-to-Value Ratio
at origination;
(16) a code indicating the loan performance status of the Mortgage Loan as
of the Cut-off Date;
(17) a code indicating whether the Mortgage Loan is a Simple Interest
Mortgage Loan or an Actuarial Mortgage Loan;
(18) a code indicating whether the Mortgage Loan has a prepayment penalty
and the type of prepayment penalty;
(19) a code indicating whether the Mortgage Loan is owner-financed; and
(20) a code indicating whether the Mortgage Loan is covered under the PMI
Policy.
The Mortgage Loan Schedule shall set forth the following
information, as of the Cut-off Date, with respect to the Mortgage Loans in the
aggregate and for each Loan Group: (1) the number of Mortgage Loans; (2) the
current Principal Balance of the Mortgage Loans; (3) the weighted average
Mortgage Interest Rate of the Mortgage Loans; and (4) the weighted average
maturity of the Mortgage Loans. The Mortgage Loan Schedule shall be amended from
time to time by the Seller in accordance with the provisions of this Agreement.
With respect to any Eligible Substitute Mortgage Loan, Cut-off Date shall refer
to the related Cut-off Date for such Mortgage Loan, determined in accordance
with the definition of Cut-off Date herein.
"Mortgage Note": The original executed note or other evidence of
indebtedness evidencing the indebtedness of a Mortgagor under a Mortgage Loan.
"Mortgage Pool": The pool of Mortgage Loans, identified on Exhibit
D-1 and D-2 from time to time, and any REO Properties acquired in respect
thereof.
"Mortgaged Property": The underlying property securing a Mortgage
Loan, including any REO Property, consisting of an Estate in Real Property
improved by a Residential Dwelling or multi-family dwelling.
"Mortgagor": The obligor on a Mortgage Note.
"Net Liquidation Proceeds": With respect to any Liquidated Mortgage
Loan or any other disposition of related Mortgaged Property (including REO
Property) the related Liquidation Proceeds net of Advances, Servicing Advances,
Servicing Fees and any other accrued and unpaid servicing fees received and
retained in connection with the liquidation of such Mortgage Loan or Mortgaged
Property.
"Net Mortgage Rate": With respect to any Mortgage Loan, the Mortgage
Interest Rate borne by such Mortgage Loan minus the Expense Fee Rate.
"New Lease": Any lease of REO Property entered into on behalf of the
Trust, including any lease renewed or extended on behalf of the Trust if the
Trust has the right to renegotiate the terms of such lease.
"Nonrecoverable Advance": Any Advance or Servicing Advance
previously made or proposed to be made in respect of a Mortgage Loan that, in
the good faith business judgment of the Servicer, will not or, in the case of a
proposed Advance or Servicing Advance, would not be ultimately recoverable from
Late Collections on such Mortgage Loan as provided herein.
"Notional Amount": On any Distribution Date, with respect to the
Class BB Certificates, an amount equal to the Original Class BB Notional Amount
reduced by the aggregate distributions made to the Class BB Certificates
pursuant to Section 4.02(b)(xv)(B).
"Offered Certificates": The Class A-1A, Class A-1F, Class A-2F,
Class M-1, Class M-2 and Class B Certificates.
"Officers' Certificate": A certificate signed by the Chairman of the
Board, the Vice Chairman of the Board, the President or a vice president
(however denominated), and by the Treasurer, the Secretary, or one of the
assistant treasurers or assistant secretaries of the Servicer, the Seller or the
Depositor, as applicable.
"Opinion of Counsel": A written opinion of counsel, who may, without
limitation, be a salaried counsel for the Depositor or the Servicer except that
any opinion of counsel relating to (a) the qualification of any REMIC as a REMIC
or (b) compliance with the REMIC Provisions must be an opinion of Independent
counsel.
"Optional Termination Date": The first Distribution Date on which
the Seller may opt to terminate the Mortgage Pool pursuant to Section 10.01.
"Original Class Certificate Principal Balance": With respect to each
Class of Certificates, the Certificate Principal Balance thereof on the Closing
Date, as set forth opposite such Class above in the Preliminary Statement,
except with respect to the Class BB, Class X and Class R Certificates, which
have an Original Class Certificate Principal Balance of zero.
"Original Class BB Notional Amount": The Notional Amount of the
Class BB Certificates on the Closing Date, as set forth opposite such Class
above in the Preliminary Statement.
"Original Notional Amount": The Original Class BB Notional Amount.
"Originator": NationsCredit Financial Services Corporation.
"Originator Mortgage Loan Purchase Agreement": The Master Mortgage
Loan Purchase Agreement, dated as of October 1, 1999, between the Originator and
the Seller relating to the purchase of the Originator Mortgage Loans.
"Originator Mortgage Loans": The Mortgage Loans listed on Exhibit
D-1 hereto.
"Overcollateralization Amount": As of any Distribution Date, the
excess, if any, of (x) the Pool Balance as of the last day of the immediately
preceding Collection Period over (y) the aggregate Certificate Principal
Balances of all Classes of Offered Certificates (after taking into account all
distributions of principal on such Distribution Date).
"Overcollateralization Deficiency": As of any Distribution Date, the
excess, if any, of (x) the Targeted Overcollateralization Amount for such
Distribution Date over (y) the Overcollateralization Amount for such
Distribution Date, calculated for this purpose after taking into account the
reduction on such Distribution Date of the Certificate Principal Balances of all
Classes of Offered Certificates resulting from the distribution of the Principal
Distribution Amount (but not the Extra Principal Distribution Amount) on such
Distribution Date, but prior to taking into account any Applied Realized Loss
Amounts on such Distribution Date.
"Overcollateralization Release Amount": With respect to any
Distribution Date after the Stepdown Date on which a Trigger Event is not in
effect, the lesser of (x) the Principal Remittance Amount for such Distribution
Date and (y) the excess, if any, of (i) the Overcollateralization Amount for
such Distribution Date, assuming that 100% of the Principal Remittance Amount is
applied as a principal payment on the Offered Certificates on such Distribution
Date, over (ii) the Targeted Overcollateralization Amount for such Distribution
Date.
"Ownership Interest": As to any Certificate, any ownership or
security 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, as owner or as pledgee.
"Pass-Through Rate": Any of the Class A-1A Pass-Through Rate, the
Class A-1F Pass-Through Rate, the Class A-2F Pass-Through Rate, the Class M-1
Pass-Through Rate, the Class M-2 Pass-Through Rate and the Class B Pass-Through
Rate. With respect to the Class BB Certificates, the Pass-Through Rate is 7.000%
per annum.
"Paying Agent": Any paying agent appointed pursuant to Section
5.05.
"Percentage Interest": With respect to any Certificate (other than a
Class BB, Class X or Class R Certificate), a fraction, expressed as a
percentage, the numerator of which is the Initial Certificate Principal Balance,
as the case may be, represented by such Certificate and the denominator of which
is the Original Class Certificate Principal Balance of the related Class. With
respect to a Class BB Certificate, the undivided percentage interest obtained by
dividing the Initial Notional Amount evidenced by such Certificate by the
Original Class BB Notional Amount of such Class. With respect to a Class X or
Class R Certificate, the portion of the Class evidenced thereby, expressed as a
percentage, as stated on the face of such Certificate; provided, however, that
the sum of all such percentages for each such Class totals 100%.
"Permitted Investments": Any one or more of the following
obligations or securities acquired at a purchase price of not greater than par,
regardless of whether issued or managed by the Depositor, the Servicer, the
Trustee or any of their respective Affiliates or for which an Affiliate of the
Trustee serves as an advisor:
(i) direct obligations of, or obligations fully guaranteed as to
timely payment of principal and interest by, the United States or any
agency or instrumentality thereof, provided such obligations are backed by
the full faith and credit of the United States;
(ii) (A) demand and time deposits in, certificates of deposit of,
bankers' acceptances issued by or federal funds sold by any depository
institution or trust company (including the Trustee or its agent acting in
their respective commercial capacities) incorporated under the laws of the
United States of America or any state thereof and subject to supervision
and examination by federal and/or state authorities, so long as, at the
time of such investment or contractual commitment providing for such
investment, such depository institution or trust company or its ultimate
parent has a short-term uninsured debt rating in one of the two highest
available rating categories of DCR and Moody's and the highest available
rating category of Fitch and provided that each such investment has an
original maturity of no more than 365 days and (B) any other demand or
time deposit or deposit which is fully insured by the FDIC;
(iii) repurchase obligations with a term not to exceed 30 days
with respect to any security described in clause (i) above and entered
into with a depository institution or trust company (acting as principal)
rated A or higher by DCR and Fitch and rated A2 or higher by Moody's,
provided, however, that collateral transferred pursuant to such repurchase
obligation must be of the type described in clause (i) above and must (A)
be valued daily at current market prices plus accrued interest or (B)
pursuant to such valuation, be equal, at all times, to 105% of the cash
transferred by the Trustee in exchange for such collateral and (C) be
delivered to the Trustee or, if the Trustee is supplying the collateral,
an agent for the Trustee, in such a manner as to accomplish perfection of
a security interest in the collateral by possession of certificated
securities;
(iv) securities bearing interest or sold at a discount that are
issued by any corporation incorporated under the laws of the United States
of America or any State thereof and that are rated by each Rating Agency
in its highest long-term unsecured rating categories at the time of such
investment or contractual commitment providing for such investment;
(v) commercial paper (including both non-interest-bearing
discount obligations and interest-bearing obligations payable on demand or
on a specified date not more than 30 days after the date of acquisition
thereof) that is rated by each Rating Agency in its highest short-term
unsecured debt rating available at the time of such investment;
(vi) units of money market funds registered under the Investment
Company Act of 1940 including funds managed or advised by the Trustee or
an affiliate thereof having the highest rating category by the applicable
Rating Agency; and
(vii) if previously confirmed in writing to the Trustee, any
other demand, money market or time deposit, or any other obligation,
security or investment, as may be acceptable to the Rating Agencies in
writing as a permitted investment of funds backing securities having
ratings equivalent to its highest initial rating of the Class A
Certificates;
provided, that no instrument described hereunder shall evidence
either the right to receive (a) only interest with respect to the obligations
underlying such instrument or (b) both principal and interest payments derived
from obligations underlying such instrument and the interest and principal
payments with respect to such instrument provide a yield to maturity at par
greater than 120% of the yield to maturity at par of the underlying obligations.
"Permitted Transferee": Any transferee of a Residual Certificate
other than a Disqualified Organization or a non-U.S. Person.
"Person": Any individual, corporation, partnership, joint venture,
association, joint stock company, trust, limited liability company,
unincorporated organization or government or any agency or political subdivision
thereof.
"PMI Fee": With respect to each PMI Mortgage Loan and for any
calendar month, an amount equal to one month's interest (or in the event of any
payment of interest which accompanies a Principal Prepayment in full made by the
Mortgagor during such calendar month, interest for the number of days covered by
such payment of interest) at the PMI Fee Rate on the same principal amount on
which interest on such PMI Mortgage Loan accrues for such calendar month.
"PMI Fee Rate": With respect to the PMI Mortgage Loans and any
Distribution Date, the rate at which the PMI Fee accrues pursuant to the PMI
Policy.
"PMI Insurer": Mortgage Guaranty Insurance Corporation, a monoline
private insurance company organized and created under the laws of the State of
Wisconsin, or its successors in interest.
"PMI Mortgage Loans": The list of Mortgage Loans insured by the PMI
Insurer attached hereto as Exhibit D-3.
"PMI Policy": The Primary Mortgage Insurance Policy (No.
42-440-3-2096) with respect to the PMI Mortgage Loans and all endorsements
thereto dated the Closing Date, issued by the PMI Insurer.
"Pool Balance": As of any date of determination, the aggregate
Principal Balance of the Mortgage Loans.
"Prepayment Assumption": Prepayment Scenario IV as set forth in the
Prospectus Supplement.
"Prepayment Interest Shortfall": With respect to any Distribution
Date, for each Mortgage Loan that was during the related Prepayment Period the
subject of a Principal Prepayment in full that was applied by the Servicer to
reduce the outstanding principal balance of such loan on a date preceding the
related Due Date, an amount equal to interest at the applicable Mortgage
Interest Rate (net of the Servicing Fee Rate) on the amount of such Principal
Prepayment for the number of days commencing on the date on which the prepayment
is applied and ending on the last day of the related Prepayment Period.
"Prepayment Period": With respect to any Distribution Date, the
calendar month preceding the month in which such Distribution Date occurs.
"Primary Insurance Policy": Each policy of primary guaranty mortgage
insurance issued by a Qualified Insurer, other than the PMI Policy, in effect
with respect to any Mortgage Loan, or any replacement policy therefor obtained
by the Servicer pursuant to Section 3.08.
"Principal Balance": As to any Mortgage Loan and any day, other than
a Liquidated Mortgage Loan, the related Cut-off Date Principal Balance, minus
all collections credited against the Principal Balance of any such Mortgage
Loan. For purposes of this definition, a Liquidated Mortgage Loan shall be
deemed to have a Principal Balance equal to the Principal Balance of the related
Mortgage Loan as of the final recovery of related Liquidation Proceeds and a
Principal Balance of zero thereafter. As to any REO Property and any day, the
Principal Balance of the related Mortgage Loan immediately prior to such
Mortgage Loan becoming REO Property minus any REO Principal Amortization
received with respect thereto on or prior to such day.
"Principal Distribution Amount": As to any Distribution Date, the
sum of (i) the Principal Remittance Amount minus, for Distribution Dates
occurring on and after the Stepdown Date and for which a Trigger Event is not in
effect, the Overcollateralization Release Amount, if any, and (ii) the Extra
Principal Distribution Amount, if any.
"Principal Prepayment": Any payment of principal made by the
Mortgagor on a Mortgage Loan which is received in advance of its scheduled Due
Date and which is not accompanied by an amount of interest representing the full
amount of scheduled interest due on any Due Date in any month or months
subsequent to the month of prepayment.
"Principal Remittance Amount": With respect to any Distribution
Date, to the extent of funds available therefor, the sum (less amounts available
for reimbursement of Monthly Advances and Servicing Advances pursuant to Section
3.05 and expenses reimbursable pursuant to Section 6.03) of: (i) each payment of
principal on a Mortgage Loan due during the related Collection Period and
received by the Servicer on or prior to the related Determination Date, and any
Advances with respect thereto, (ii) all full and partial Principal Prepayments
received by the Servicer during the related Prepayment Period, (iii) the Net
Liquidation Proceeds allocable to principal actually collected by the Servicer
during the related Prepayment Period, (iv) with respect to Defective Mortgage
Loans repurchased with respect to such Prepayment Period, the portion of the
Purchase Price allocable to principal, (v) any Substitution Adjustment Amounts
received on or prior to the previous Determination Date and not yet distributed
and (vi) on the Distribution Date on which the Trust is to be terminated in
accordance with Section 10.01 hereof, that portion of the Termination Price in
respect of principal.
"Private Certificates": Any of the Class X, Class BB and Class R
Certificates.
"Property Insurance Proceeds": Proceeds of any title policy, hazard
policy or other insurance policy covering a Mortgage Loan, to the extent such
proceeds are received by the Servicer and are not to be applied to the
restoration of the related Mortgaged Property or released to the Mortgagor in
accordance with the Servicer's servicing procedures, subject to the terms and
conditions of the related Mortgage Note and Mortgage.
"Prospectus Supplement": That certain Prospectus Supplement dated
December 15, 1999 relating to the public offering of the Offered Certificates.
"Purchase Price": With respect to any Mortgage Loan or REO Property
to be purchased pursuant to or as contemplated by Section 2.03 or 10.01, and as
confirmed by an Officers' Certificate from the Servicer to the Trustee, an
amount equal to the sum of (i) 100% of the Principal Balance thereof as of the
date of purchase (or such other price as provided in Section 10.01), (ii) in the
case of (x) a Mortgage Loan, accrued interest on such Principal Balance at the
applicable Mortgage Interest Rate in effect from time to time from the Due Date
as to which interest was last covered by a payment by the Mortgagor or an
advance by the Servicer, which payment or advance had as of the date of purchase
been distributed pursuant to Section 4.01, through the end of the calendar month
in which the purchase is to be effected, and (y) an REO Property, the sum of (1)
accrued interest on such Principal Balance at the applicable Mortgage Interest
Rate in effect from time to time from the Due Date as to which interest was last
covered by a payment by the Mortgagor through the end of the calendar month
immediately preceding the calendar month in which such REO Property was
acquired, plus (2) REO Imputed Interest for such REO Property for each calendar
month commencing with the calendar month in which such REO Property was acquired
and ending with the calendar month in which such purchase is to be effected, net
of the total of all net rental income, Insurance Proceeds and Liquidation
Proceeds that as of the date of purchase had been distributed as or to cover REO
Imputed Interest pursuant to Section 4.07, (iii) any unreimbursed Servicing
Advances and Advances and any unpaid Servicing Fees and Special Servicing Fees
allocable to such Mortgage Loan, (iv) any amounts previously withdrawn from the
Collection Account in respect of such Mortgage Loan or REO Property pursuant to
Section 3.13, and (v) in the case of a Mortgage Loan required to be purchased
pursuant to Section 2.03, expenses reasonably incurred or to be incurred by the
Servicer or the Trustee in respect of the breach or defect giving rise to the
purchase obligation. With respect to any Originator Mortgage Loan to be
purchased pursuant to or as contemplated by Section 2.10, the purchase price as
set forth in Section 5 of the Originator Mortgage Loan Purchase Agreement.
"Qualified Insurer": Any insurance company acceptable to FNMA or
FHLMC.
"Rating Agency or Rating Agencies": Moody's, Fitch and DCR, or their
respective successors. If such agencies or their successors are no longer in
existence, "Rating Agencies" shall be such nationally recognized statistical
rating organizations as set forth on the most current list of such organizations
released by the Securities and Exchange Commission and designated by the
Depositor, notice of which designation shall be given to the Trustee and the
Servicer.
"Realized Loss": With respect to a Liquidated Mortgage Loan, the
amount by which the remaining unpaid principal balance of the Mortgage Loan
exceeds the amount of Net Liquidation Proceeds applied to the principal balance
of the related Mortgage Loan.
"Realized Loss Amortization Amount": Any of the Class M-1 Realized
Loss Amortization Amount, the Class M-2 Realized Loss Amortization Amount, and
the Class B Realized Loss Amortization Amount.
"Record Date": With respect to all of the Certificates (except for
the Class A-1A Certificates), the last Business Day of the month immediately
preceding the month in which the related Distribution Date occurs (or the
Closing Date, in the case of the first Distribution Date). With respect to the
Class A-1A Certificates, the Business Day immediately preceding such
Distribution Date; provided, however, that if any Class A-1A Certificate becomes
a Definitive Certificate, the Record Date for such Certificate shall be the last
Business Day of the month immediately preceding the month in which the related
Distribution Date occurs.
"Reference Banks": Those banks (i) with an established place of
business in London, England, (ii) not controlling, under the control of or under
common control with the Depositor or the Trustee, (iii) whose quotations appear
on the Telerate Page 3750 on the relevant LIBOR Determination Date and (iv)
which have been designated as such by the Trustee; provided, however, that if
fewer than two of such banks provide a LIBOR rate, then any leading banks
selected by the Trustee which are engaged in transactions in United States
dollar deposits in the international Eurocurrency market.
"Regular Certificate": Any of the Class A, Class M, Class B, Class
BB and Class X Certificates.
"Related Documents": With respect to any Mortgage Loan, the related
Mortgage Notes, Mortgages and other related documents.
"Relief Act": The Soldiers' and Sailors Civil Relief Act of 1940, as
amended.
"Relief Act Interest Shortfall": With respect to any Distribution
Date, for any Mortgage Loan with respect to which there has been a reduction in
the amount of interest collectible thereon for the most recently ended
Collection Period as a result of the application of the Relief Act, the amount
by which (i) interest collectible on such Mortgage Loan during such Collection
Period is less than (ii) one month's interest on the Principal Balance of such
Mortgage Loan at the Mortgage Interest Rate for such Mortgage Loan before giving
effect to the application of the Relief Act.
"REMIC": A "real estate mortgage investment conduit" within the
meaning of Section 860D of the Code.
"Remaining Initial Overcollateralization Amount": As of any
Distribution Date, an amount equal to (a) the Initial Overcollateralization
Amount minus (b) the sum of (i) any principal payments and (ii) Realized Losses
allocated to the Class X/BB Interest.
"REMIC Provisions": Provisions of the federal income tax law
relating to real estate mortgage investment conduits which appear at Section
860A through 860G of Subchapter M of Chapter 1 of the Code, and related
provisions, and regulations and rulings promulgated thereunder, as the foregoing
may be in effect from time to time.
"REMIC 1 Regular Interests": The Class T1-1 Interest, Class T1-2
Interest, Class T1-3 Interest and Class T1-4 Interest.
"REMIC 2 Pass-Through Rate": With respect to any Distribution Date,
a rate obtained by dividing (A) the product of (i) 2 times (ii) the Weighted
Average Net Mortgage Rate times (iii) the Class T1-2 Principal Amount by (B) the
sum of (x) the Class T1-2 Principal Amount and (y) the Class T1-3 Principal
Amount, such principal balances being determined before any reductions of
principal balance made on such Distribution Date.
"REMIC 2 Regular Interests": The Class T2-1 Interest, Class T2-2
Interest, Class T2-3 Interest, Class T2-4 Interest, Class T2-5 Interest, Class
T2-6 Interest and Class T2-7 Interest.
"REMIC 3 Regular Interests": The Class T3-A1A Interest, Class T3-A1F
Interest, Class T3-A2F Interest, Class T3-M1 Interest, Class T3-M2 Interest,
Class T3-B Interest, Class T3-4 Interest, Class T3-5 Interest, Class T3-6
Interest and Class T3-7 Interest.
"REMIC 4 Components": The T4-4, Class T4-5, Class T4-6, Class T4-7,
Class T4-11, Class T4-12, Class T4-13, Class T4-14, Class T4-15 and Class T4-16
Interests. Each of the REMIC 4 Components represents a regular interest in REMIC
4.
"REMIC 4 Regular Interests": The Class T4-A1A Interest, the Class
A-1F Certificates, Class A-2F Certificates, Class M-1 Certificates, Class M-2
Certificates and Class B Certificates and the Class T4-4 Interest, Class T4-5
Interest, Class T4-6 Interest, Class T4-7 Interest, Class T4-11 Interest, Class
T4-12 Interest, Class T4-13 Interest, Class T4-14 Interest, Class T4-15 Interest
and Class T4-16 Interest.
"REMIC Regular Interest": As defined in the Preliminary Statement.
"Remittance Report": A report prepared by the Servicer and delivered
to the Trustee pursuant to Section 4.07, containing the information attached
hereto as Exhibit P.
"Rents from Real Property": With respect to any REO Property, gross
income of the character described in Section 856(d) of the Code.
"REO Account": The account or accounts maintained by the Servicer in
respect of an REO Property pursuant to Section 3.13.
"REO Disposition": The sale or other disposition of an REO Property
on behalf of the Trust Fund.
"REO Imputed Interest": As to any REO Property, for any calendar
month during which such REO Property was at any time part of the Trust Fund, one
month's interest at the applicable Net Mortgage Rate on the Principal Balance of
such REO Property (or, in the case of the first such calendar month, of the
related Mortgage Loan if appropriate) as of the close of business on the
Distribution Date in such calendar month.
"REO Principal Amortization": With respect to any REO Property, for
any calendar month, the excess, if any, of (a) the aggregate of all amounts
received in respect of such REO Property during such calendar month, whether in
the form of rental income, sale proceeds (including, without limitation, that
portion of the Termination Price paid in connection with a purchase of all of
the Mortgage Loans and REO Properties pursuant to Section 10.01 that is
allocable to such REO Property) or otherwise, net of any portion of such amounts
(i) payable pursuant to Section 3.13 in respect of the proper operation,
management and maintenance of such REO Property or (ii) payable or reimbursable
to the Servicer pursuant to Section 3.13 for unpaid Servicing Fees in respect of
the related Mortgage Loan and unreimbursed Servicing Advances and Advances in
respect of the related Mortgage Loan, over (b) the REO Imputed Interest in
respect of such REO Property for such calendar month.
"REO Property": A Mortgaged Property acquired by the Servicer on
behalf of the Trust Fund through foreclosure or deed-in-lieu of foreclosure, as
described in Section 3.13.
"Request for Release": A release signed by a Servicing Officer, in
the form of Exhibit E-1 or Exhibit E-2 attached hereto.
"Required Reserve Fund Balance": An initial amount equal to $74,000.
If on or after the Distribution Date in January 2003, the then current Notional
Amount of the Class BB Certificates is equal to or less than 25.00% of the
Original Class BB Notional Amount, the Required Reserve Fund Balance shall be
reduced to the lesser of (a) $74,000 or (b) an amount equal to the expected
amount of Accrued Certificate Interest for the Class BB Certificates to be
accrued for the three months following the date of determination. In the event
that at any time prior to January 2003 the then current Notional Amount of the
Class BB Certificates is equal to or less than 25.00% of the Original Class BB
Notional Amount, the Seller may request in writing that DCR permit the Class BB
Reserve Fund to be reduced to the lesser of (a) $74,000 or (b) an amount equal
to the expected amount of Accrued Certificate Interest for the Class BB
Certificates to be accrued for the three months following the date of
determination.
"Required Reserve Fund Deposit": With respect to any Distribution
Date, the amount, if any, by which (i) the Required Reserve Fund Balance exceeds
(ii) the amount on deposit in the Class BB Reserve Fund (after taking into
account any deposits into the Class BB Reserve Fund for such Distribution Date).
"Residential Dwelling": Any one of the following: (i) a detached
one-family dwelling, (ii) a detached two- to four-family dwelling, (iii) a
one-family dwelling unit in a FNMA eligible condominium project, (iv) a detached
one-family dwelling in a planned unit development, which is not a co-operative,
or (v) a mobile or manufactured home (as defined in 42 United States Code,
Section 5402(6)).
"Residual Certificate": The Class R Certificates.
"Residual Interest": The sole Class of "residual interests" in a
REMIC within the meaning of Section 860G(a)(2) of the Code.
"Responsible Officer": When used with respect to the Trustee, any
officer assigned to the Corporate Trust Division (or any successor thereto),
including any Vice President, Assistant Vice President, Trust Officer, any
Assistant Secretary, any trust officer or any other officer of the Trustee
customarily performing functions similar to those performed by any of the above
designated officers and in each case having direct responsibility for the
administration of this Agreement.
"Seller": Credit-Based Asset Servicing and Securitization LLC, or
its successor in interest, in its capacity as seller under the Mortgage Loan
Purchase Agreement.
"Seller Mortgage Loans": The Mortgage Loans listed on Exhibit D-2
hereto.
"Seller Warranty Certificate": The seller warranty certificate,
dated December 21, 1999, executed and delivered by the Originator to, and for
the benefit of the Seller, with respect to certain representations and
warranties on the Originator Mortgage Loans.
"Senior Certificates": The Class A-1A, Class A-1F and Class A-2F
Certificates.
"Senior Enhancement Percentage": For any Distribution Date, the
percentage obtained by dividing (x) the sum of (i) the aggregate Certificate
Principal Balances of the Subordinated Certificates and (ii) the
Overcollateralization Amount, in each case after taking into account the
distribution of the Principal Distribution Amount on such Distribution Date by
(y) the Pool Balance as of the last day of the related Collection Period.
"Senior Specified Enhancement Percentage": On any date of
determination thereof, 40.00%.
"Servicer": Litton Loan Servicing LP, a Delaware limited
partnership, or any successor servicer appointed as herein provided, in its
capacity as Servicer hereunder.
"Servicer Affiliate": A Person (i) controlling, controlled by or
under common control with the Servicer or which is 50% or more owned by the
Servicer and (ii) which is qualified to service residential mortgage loans.
"Servicer Event of Termination": One or more of the events described
in Section 7.01.
"Servicer Remittance Date": With respect to any Distribution Date,
one Business Day prior to such Distribution Date.
"Servicing Advances": All customary, reasonable and necessary "out
of pocket" costs and expenses incurred by the Servicer in the performance of its
servicing obligations, including, but not limited to, the cost of (i) the
preservation, restoration and protection of the Mortgaged Property, (ii) any
enforcement or judicial proceedings, including foreclosures, (iii) the
management and liquidation of the REO Property and (iv) compliance with the
obligations under Section 3.08.
"Servicing Fee": With respect to each Mortgage Loan and for any
calendar month, an amount equal to one month's interest (or in the event of any
payment of interest which accompanies a Principal Prepayment in full made by the
Mortgagor during such calendar month, interest for the number of days covered by
such payment of interest) at the Servicing Fee Rate on the same principal amount
on which interest on such Mortgage Loan accrues for such calendar month.
"Servicing Fee Rate": With respect to each Mortgage Loan, 0.50% per
annum.
"Servicing Officer": Any officer of the Servicer involved in, or
responsible for, the administration and servicing of Mortgage Loans, whose name
and specimen signature appear on a list of servicing officers furnished by the
Servicer to the Trustee and the Depositor on the Closing Date, as such list may
from time to time be amended.
"Servicing Standard": Shall mean the standards set forth in Section
3.01.
"Simple Interest Method": The method of allocating a payment to
principal and interest, pursuant to which the portion of such payment that is
allocated to interest is equal to the product of the fixed rate of interest
multiplied by the unpaid principal balance multiplied by the period of time
elapsed since the preceding payment of interest was made and divided by either
360 or 365, as specified in the related Mortgage Note, and the remainder of such
payment is allocated to principal.
"Simple Interest Mortgage Loan": Any Mortgage Loan under which the
portion of a payment allocable to interest and the portion of such payment
allocable to principal is determined in accordance with the Simple Interest
Method.
"Special Servicing Fee": With respect to each Mortgage Loan that is
delinquent 90 or more days, $150 per month payable until the earlier of (i) 18
consecutive months and (ii) the Delinquency status of such Mortgage Loan has
been reduced to less than 90 days.
"Startup Day": As defined in Section 9.01(b) hereof.
"Stayed Funds": Any payment required to be made under the terms of
the Certificates and this Agreement but which is not remitted by the Servicer
because the Servicer is the subject of a proceeding under the Bankruptcy Code
and the making of such remittance is prohibited by Section 362 of the Bankruptcy
Code.
"Stepdown Date": The later to occur of (x) the Distribution Date in
December 2002 and (y) the first Distribution Date on which the Senior
Enhancement Percentage (after taking into account distributions of principal on
such Distribution Date) is greater than or equal to the Senior Specified
Enhancement Percentage.
"Subordinated Certificates": The Class M-1, Class M-2, Class B,
Class BB, Class X and Class R Certificates.
"Subsequent Overcollateralization Amount": As of any Distribution
Date, after the application of principal payments and Applied Realized Loss
Amounts, an amount equal to the excess, if any of (a) the Pool Balance over (b)
the sum of (i) the Certificate Principal Balance of each Class of Offered
Certificates and (ii) the Remaining Initial Overcollateralization Amount.
"Substitution Adjustment Amount": As defined in Section 2.03(d)
hereof.
"Targeted Overcollateralization Amount": As of any Distribution
Date, (x) prior to the Stepdown Date, 3.75% of the initial Pool Balance and (y)
on and after the Stepdown Date, the lesser of (i) 3.75% of the initial Pool
Balance and (ii) the greater of (A) 7.50% of the Pool Balance as of the last day
of the related Collection Period and (B) 0.50% of the initial Pool Balance.
"Tax Matters Person": The tax matters person appointed pursuant to
Section 9.01(e) hereof.
"Tax Returns": The federal income tax returns on Internal Revenue
Service Form 1066, U.S. Real Estate Mortgage Investment Conduit Income Tax
Return, including Schedule Q thereto, Quarterly Notice to Residual Interest
Holders of the REMIC Taxable Income or Net Loss Allocation, or any successor
forms, to be filed on behalf of the Trust in its capacity as a REMIC under the
REMIC Provisions, together with any and all other information reports or returns
that may be required to be furnished to the Certificateholders of the related
Group or filed with the Internal Revenue Service or any other governmental
taxing authority under any applicable provisions of federal, state or local tax
laws.
"Telerate Page 3750": The display page currently so designated on
the Bridge Telerate Service (or such other page as may replace the Telerate Page
3750 page on that service for the purpose of displaying London interbank offered
rates of major banks).
"Termination Price": As defined in Section 10.01(a) hereof.
"Transition Cost": Any documented fees, expenses and allocated costs
reasonably incurred by a successor Servicer or the Trustee in connection with a
transfer of servicing from the Servicer to a successor Servicer.
"Trigger Event": With respect to any Distribution Date, if (i) the
six-month rolling average of 60+ Day Delinquent Loans equals or exceeds 50% of
the Senior Enhancement Percentage; provided, that if the Certificate Principal
Balance of the Senior Certificates has been reduced to zero, a Trigger Event
will have occurred if the six-month rolling average of 60+ Day Delinquent Loans
equals or exceeds 20% or (ii) the aggregate amount of Realized Losses incurred
since the Cut-off Date through the last day of the related Collection Period
divided by the initial Pool Balance exceeds the applicable percentages set forth
below with respect to such Distribution Date:
DISTRIBUTION DATE OCCURRING IN PERCENTAGE
December 2002 through November 2003 2.50%
December 2003 through November 2004 3.00%
December 2004 through November 2005 3.75%
December 2005 and thereafter 4.00%
"Trust": Asset Backed Funding Trust 1999-1, the trust created
hereunder.
"Trust Fund": The segregated pool of assets subject hereto,
constituting the primary trust created hereby and to be administered hereunder,
with respect to a portion of which four REMIC elections are to be made, such
entire Trust Fund consisting of: (i) such Mortgage Loans as from time to time
are subject to this Agreement, together with the Mortgage Files relating
thereto, and together with all collections thereon and proceeds thereof, (ii)
any REO Property, together with all collections thereon and proceeds thereof,
(iii) the Trustee's rights with respect to the Mortgage Loans under all
insurance policies required to be maintained pursuant to this Agreement and any
proceeds thereof, (iv) the Depositor's rights under the Mortgage Loan Purchase
Agreement (including any security interest created thereby) and (v) the
Collection Account, the Distribution Account and any REO Account and such assets
that are deposited therein from time to time and any investments thereof,
together with any and all income, proceeds and payments with respect thereto.
Notwithstanding the foregoing, however, the Trust Fund specifically excludes all
payments and other collections of principal and interest due on the Mortgage
Loans before the Cut-off Date.
"Trustee": The Chase Manhattan Bank, a New York banking corporation,
or any successor Trustee appointed as herein provided.
"Trustee Fee": With respect to any Distribution Date, the product of
(x) one-twelfth of the Trustee Fee Rate and (y) the aggregate of the Principal
Balances of all Mortgage Loans as of the opening of business on the first day of
the related Collection Period.
"Trustee Fee Rate": With respect to any Distribution Date, 0.0175%
per annum.
"Underwriters": Banc of America Securities LLC and Prudential
Securities Incorporated, as underwriters with respect to the Offered
Certificates.
"United States Person" or "U.S. Person": (i) A citizen or resident
of the United States, (ii) a corporation, partnership or other entity treated as
a corporation or partnership for United States federal income tax purposes
organized in or under the laws of the United States or any state thereof or the
District of Columbia (unless, in the case of a partnership, Treasury regulations
provide otherwise) or (iii) an estate the income of which is includible in gross
income for United States tax purposes, regardless of its source, or (iv) a trust
if a court within the United States is able to exercise primary supervision over
the administration of the trust and one or more United States persons have
authority to control all substantial decisions of the trust. Notwithstanding the
preceding sentence, to the extent provided in Treasury regulations, certain
Trusts in existence on August 20, 1996, and treated as United States persons
prior to such date, that elect to continue to be treated as United States
persons will also be a U.S. Person.
"Unpaid Realized Loss Amount": For any Class B, Class M-1 and Class
M-2 Certificates and as to any Distribution Date, the excess of (x) the
aggregate Applied Realized Loss Amounts applied respect to such Class for all
prior Distribution Dates over (y) the aggregate Realized Loss Amortization
Amounts with respect to such Class for all prior Distribution Dates.
"Value": With respect to any Mortgaged Property, the value thereof
as determined by an independent appraisal made at the time of the origination of
the related Mortgage Loan or the sale price, if the appraisal is not available;
except that, with respect to any Mortgage Loan that is a purchase money mortgage
loan, the lesser of (i) the value thereof as determined by an independent
appraisal made at the time of the origination of such Mortgage Loan, if any, and
(ii) the sales price of the related Mortgaged Property.
"Voting Rights": The portion of the voting rights of all of the
Certificates which is allocated to any Certificate. The Voting Rights allocated
among Holders of the Offered Certificates shall be 98%, and shall be allocated
among each such Class according to the fraction, expressed as a percentage, the
numerator of which is the aggregate Certificate Principal Balance of all the
Certificates of such Class then outstanding and the denominator of which is the
aggregate Certificate Principal Balance of all the Offered Certificates then
outstanding. The Voting Rights allocated to each such Class of Certificates
shall be allocated among all holders of each such Class in proportion to the
outstanding Certificate Principal Balance of such Certificates; provided,
however, that any Certificate registered in the name of the Servicer, the
Depositor or the Trustee or any of their respective affiliates shall not be
included in the calculation of Voting Rights. The percentage of all the Voting
Rights allocated among the Holders of the Class X Certificate shall be 2%. The
Class BB and Class R Certificates shall have no Voting Rights.
"Weighted Average Net Mortgage Rate": The weighted average (based on
Principal Balance) of the Net Mortgage Rates of the Mortgage Loans, expressed as
an annual rate and calculated on the basis of twelve months consisting of 30
days each and a 360-day year.
"Written Order to Authenticate": A written order by which the
Depositor directs the Trustee to issue the Certificates.
Section 1.02 Accounting.
Unless otherwise specified herein, for the purpose of any definition
or calculation, whenever amounts are required to be netted, subtracted or added
or any distributions are taken into account such definition or calculation and
any related definitions or calculations shall be determined without duplication
of such functions.
ARTICLE II
CONVEYANCE OF MORTGAGE LOANS;
ORIGINAL ISSUANCE OF CERTIFICATES
Section 2.01 Conveyance of Mortgage Loans.
The Depositor, concurrently with the execution and delivery hereof,
does hereby transfer, assign, set over and otherwise convey to the Trustee
without recourse for the benefit of the Certificateholders all the right, title
and interest of the Depositor, including any security interest therein for the
benefit of the Depositor, in and to (i) each Mortgage Loan identified on the
Mortgage Loan Schedule, including the related Cut-off Date Principal Balance,
all interest accruing thereon after the Cut-off Date and all collections in
respect of interest and principal due after the Cut-off Date; (ii) property
which secured each such Mortgage Loan and which has been acquired by foreclosure
or deed in lieu of foreclosure; (iii) its interest in any insurance policies in
respect of the Mortgage Loans; (iv) all proceeds of any of the foregoing; (vi)
the rights of the Depositor under the Mortgage Loan Purchase Agreement and the
Originator Mortgage Loan Purchase Agreement, (vii) the rights of the Depositor
under the Seller Warranty Certificate, and (viii) all other assets included or
to be included in the Trust Fund. Such assignment includes all interest and
principal due to the Depositor or the Servicer after the Cut-off Date with
respect to the Mortgage Loans.
In connection with such transfer and assignment, the Seller, on
behalf of the Depositor, does hereby deliver to, and deposit with the Trustee,
or its designated agent (the "Custodian"), the following documents or
instruments with respect to each Mortgage Loan (a "Mortgage File") so
transferred and assigned:
(i) the original Mortgage Note, endorsed either (A) in blank or (B) in
the following form: "Pay to the order of The Chase Manhattan Bank,
as Trustee under the Pooling and Servicing Agreement, dated as of
November 1, 1999, among Credit-Based Asset Servicing and
Securitization LLC, Asset Backed Funding Corporation, Litton Loan
Servicing LP and The Chase Manhattan Bank, Asset Backed Funding
Trust 1999-1, Asset Backed Funding Certificates, Series 1999-1,
without recourse", or with respect to any lost Mortgage Note, an
original Lost Note Affidavit, together with a copy of the related
Mortgage Note;
(ii) the original Mortgage with evidence of recording thereon, and the
original recorded power of attorney, if the Mortgage was executed
pursuant to a power of attorney, with evidence of recording thereon
or, if such Mortgage or power of attorney has been submitted for
recording but has not been returned from the applicable public
recording office, has been lost or is not otherwise available, a
copy of such Mortgage or power of attorney, as the case may be,
certified to be a true and complete copy of the original submitted
for recording;
(iii) an original Assignment of Mortgage, in form and substance acceptable
for recording. The Mortgage shall be assigned either (A) in blank or
(B) to "The Chase Manhattan Bank, as Trustee under the Pooling and
Servicing Agreement, dated as of November 1, 1999, among
Credit-Based Asset Servicing and Securitization LLC, Asset Backed
Funding Corporation, Litton Loan Servicing LP and The Chase
Manhattan Bank, Asset Backed Funding Trust 1999-1, Asset Backed
Funding Certificates, Series 1999-1, without recourse";
(iv) an original copy of any intervening assignment of Mortgage showing a
complete chain of assignments;
(v) the original or copies of each assumption, modification, written
assurance or substitution agreement, if any;
(vi) with respect to each Mortgage Loan that is subject to the provisions
of the Homeownership and Equity Protection Act of 1994, a copy of a
notice to each entity that was a purchaser or assignee of such
Mortgage Loan, satisfying the provisions of such Act and the
regulations issued thereunder, to the effect that the Mortgage Loan
is subject to special truth in lending rules; and
(vii) the original, or a certified copy of the, Primary Insurance Policy.
The Trustee agrees to execute and deliver (or cause the Custodian to
execute and deliver) to the Depositor on or prior to the Closing Date an
acknowledgment of receipt of the original Mortgage Note (with any exceptions
noted), substantially in the form attached as Exhibit F-3 hereto.
The Servicer shall promptly (and in no event later than thirty days
following the Closing Date) submit or cause to be submitted for recording, at
the Servicer's expense and at no expense to the Trust Fund or the Trustee, in
the appropriate public office for real property records, each Assignment
referred to in Sections 2.01(iii) and (iv) above. In the event that any such
Assignment is lost or returned unrecorded because of a defect therein, the
Seller shall promptly prepare or cause to be prepared a substitute Assignment or
cure or cause to be cured such defect, as the case may be, and thereafter cause
each such Assignment to be duly recorded.
If any of the documents referred to in Section 2.01(ii), (iii) or
(iv) above has as of the Closing Date been submitted for recording but either
(x) has not been returned from the applicable public recording office or (y) has
been lost or such public recording office has retained the original of such
document, the obligations of the Seller to deliver such documents shall be
deemed to be satisfied upon (1) delivery to the Trustee or the Custodian no
later than the Closing Date, of a copy of each such document certified by the
Seller in the case of (x) above or the applicable public recording office in the
case of (y) above to be a true and complete copy of the original that was
submitted for recording and (2) if such copy is certified by the Seller,
delivery to the Trustee or the Custodian, promptly upon receipt thereof of
either the original or a copy of such document certified by the applicable
public recording office to be a true and complete copy of the original. The
Seller shall deliver or cause to be delivered to the Trustee or the Custodian
promptly upon receipt thereof any other documents constituting a part of a
Mortgage File received with respect to any Mortgage Loan, including, but not
limited to, any original documents evidencing an assumption or modification of
any Mortgage Loan.
Upon discovery or receipt of notice of any materially defective
document in, or that a document is missing from, a Mortgage File, the Seller
shall have 120 days to cure such defect or 150 days following the Closing Date,
in the case of missing Mortgages or Assignments or deliver such missing document
to the Trustee or the Custodian. If the Seller does not cure such defect or
deliver such missing document within such time period, the Seller shall either
repurchase or substitute for such Mortgage Loan in accordance with Section 2.03.
The Seller shall cause the Assignments of Mortgage which were
delivered in blank and cause to be completed and shall cause all Assignments
referred to in Section 2.01(iii) hereof and, to the extent necessary, in Section
2.01(iv) hereof to be recorded; provided, however, the Seller need not cause to
be recorded any Assignment which relates to a Mortgage Loan in any jurisdiction
under the laws of which, as evidenced by an Opinion of Counsel delivered by the
Seller to the Trustee and the Rating Agencies, the recordation of such
assignment is not necessary to protect the Trustee's interest in the related
Mortgage Loan. The Seller shall be required to deliver such assignments for
recording within 30 days of the Closing Date. The Seller shall furnish the
Trustee, or its designated agent, with a copy of each assignment of Mortgage
submitted for recording. In the event that any such Assignment is lost or
returned unrecorded because of a defect therein, the Seller shall promptly have
a substitute Assignment prepared or have such defect cured, as the case may be,
and thereafter cause each such Assignment to be duly recorded. In the event that
any Mortgage Note is endorsed in blank as of the Closing Date, promptly
following the Closing Date the Seller shall cause to be completed such
endorsements "Pay to the order of The Chase Manhattan Bank, as Trustee under the
Pooling and Servicing Agreement, dated as of November 1, 1999, among
Credit-Based Asset and Securitization LLC, Asset Backed Funding Corporation,
Litton Loan Servicing LP and The Chase Manhattan Bank, Asset Backed Funding
Certificates, Series 1999-1, without recourse."
The Depositor herewith delivers to the Trustee an executed copy of
the Mortgage Loan Purchase Agreement.
Section 2.02 Acceptance by Trustee.
The Trustee acknowledges the receipt of, subject to the provisions
of Section 2.01 and subject to the review described below and any exceptions
noted on the exception report described in the next paragraph below, the
documents referred to in Section 2.01 above and all other assets included in the
definition of "Trust Fund" and declares that it holds and will hold such
documents and the other documents delivered to it constituting a Mortgage File,
and that it holds or will hold all such assets and such other assets included in
the definition of "Trust Fund" in trust for the exclusive use and benefit of all
present and future Certificateholders.
The Trustee agrees, for the benefit of the Certificateholders, to
review (or cause the Custodian to review) each Mortgage File within 60 days
after the Closing Date (or, with respect to any document delivered after the
Startup Day, within 60 days of receipt and with respect to any Qualified
Substitute Mortgage, within 60 days after the assignment thereof) and to certify
in substantially the form attached hereto as Exhibit F-1 that, as to each
Mortgage Loan listed in the Mortgage Loan Schedule (other than any Mortgage Loan
paid in full or any Mortgage Loan specifically identified in the exception
report annexed thereto as not being covered by such certification), (i) all
documents required to be delivered to it pursuant Section 2.01 of this Agreement
are in its possession, (ii) such documents have been reviewed by it and have not
been mutilated, damaged or torn and relate to such Mortgage Loan and (iii) based
on its examination and only as to the foregoing, the information set forth in
the Mortgage Loan Schedule that corresponds to items (1), (2), (3), (5), (12)
and (18) (in the case of (18), only as to whether there is a prepayment penalty)
of the Mortgage Loan Schedule accurately reflects information set forth in the
Mortgage File. It is herein acknowledged that, in conducting such review, the
Trustee (or the Custodian, as applicable) is under no duty or obligation to
inspect, review or examine any such documents, instruments, certificates or
other papers to determine that they are genuine, enforceable, or appropriate for
the represented purpose or that they have actually been recorded or that they
are other than what they purport to be on their face.
Prior to the first anniversary date of this Agreement the Trustee
shall deliver (or cause the Custodian to deliver) to the Depositor and the
Servicer a final certification in the form annexed hereto as Exhibit F-2
evidencing the completeness of the Mortgage Files, with any applicable
exceptions noted thereon.
If in the process of reviewing the Mortgage Files and making or
preparing, as the case may be, the certifications referred to above, the Trustee
(or the Custodian, as applicable) finds any document or documents constituting a
part of a Mortgage File to be missing or defective in any material respect, at
the conclusion of its review the Trustee shall so notify the Seller, the
Depositor and the Servicer. In addition, upon the discovery by the Seller,
Depositor or the Servicer (or upon receipt by the Trustee of written
notification of such breach) of a breach of any of the representations and
warranties made by the Seller in the related Mortgage Loan Purchase Agreement in
respect of any Mortgage Loan which materially adversely affects such Mortgage
Loan or the interests of the related Certificateholders in such Mortgage Loan,
the party discovering such breach shall give prompt written notice to the other
parties.
The Depositor and the Trustee intend that the assignment and
transfer herein contemplated constitute a sale of the Mortgage Loans and the
Related Documents, conveying good title thereto free and clear of any liens and
encumbrances, from the Depositor to the Trustee and that such property not be
part of the Depositor's estate or property of the Depositor in the event of any
insolvency by the Depositor. In the event that such conveyance is deemed to be,
or to be made as security for, a loan, the parties intend that the Depositor
shall be deemed to have granted and does hereby grant to the Trustee a first
priority perfected security interest in all of the Depositor's right, title and
interest in and to the Mortgage Loans and the Related Documents, and that this
Agreement shall constitute a security agreement under applicable law.
Section 2.03 Repurchase or Substitution of Mortgage Loans by the
Seller.
(a) Upon discovery or receipt of written notice of any materially
defective document in, or that a document is missing from, a Mortgage File or of
the breach by the Seller of any representation, warranty or covenant under the
Mortgage Loan Purchase Agreement or in Section 2.04 in respect of any Mortgage
Loan which materially adversely affects the value of such Mortgage Loan or the
interest therein of the Certificateholders, the Trustee (or the Custodian, as
applicable) shall promptly notify the Seller and the Servicer of such defect,
missing document or breach and request that the Seller deliver such missing
document or cure such defect or breach within 120 days or 150 days following the
Closing Date, in the case of missing Mortgages or Assignments from the date the
Seller was notified of such missing document, defect or breach, and if the
Seller does not deliver such missing document or cure such defect or breach in
all material respects during such period, the Trustee shall enforce the Seller's
obligation under the Mortgage Loan Purchase Agreement and cause the Seller to
repurchase such Mortgage Loan from the Trust Fund at the Purchase Price on or
prior to the Determination Date following the expiration of such 120 day period
(subject to Section 2.03(e)); provided that, in connection with any such breach
that could not reasonably have been cured within such 120 day or 150 day period,
if the Seller shall have commenced to cure such breach within such 120 day or
150 day period, the Seller shall be permitted to proceed thereafter diligently
and expeditiously to cure the same within the additional period provided under
the Mortgage Loan Purchase Agreement. The Purchase Price for the repurchased
Mortgage Loan shall be deposited in the Collection Account, and the Trustee,
upon receipt of written certification from the Servicer of such deposit, shall
release to the Seller the related Mortgage File and shall execute and deliver
such instruments of transfer or assignment, in each case without recourse, as
the Seller shall furnish to it and as shall be necessary to vest in the Seller
any Mortgage Loan released pursuant hereto and the Trustee shall have no further
responsibility with regard to such Mortgage File. In lieu of repurchasing any
such Mortgage Loan as provided above, the Seller may cause such Mortgage Loan to
be removed from the Trust Fund (in which case it shall become a Defective
Mortgage Loan) and substitute one or more Eligible Substitute Mortgage Loans in
the manner and subject to the limitations set forth in Section 2.03(d). It is
understood and agreed that the obligation of the Seller to cure or to repurchase
(or to substitute for) any Mortgage Loan as to which a document is missing, a
material defect in a constituent document exists or as to which such a breach
has occurred and is continuing shall constitute the sole remedy against the
Seller respecting such omission, defect or breach available to the Trustee on
behalf of the Certificateholders.
(b) [Reserved].
(c) Within 90 days of the earlier of discovery by the Servicer or
receipt of notice by the Servicer of the breach of any representation, warranty
or covenant of the Servicer set forth in Section 2.05 which materially and
adversely affects the interests of the Certificateholders in any Mortgage Loan,
the Servicer shall cure such breach in all material respects.
(d) Any substitution of Eligible Substitute Mortgage Loans for
Defective Mortgage Loans made pursuant to Section 2.03(a) must be effected prior
to the last Business Day that is within two years after the Closing Date. As to
any Defective Mortgage Loan for which the Seller substitutes a Eligible
Substitute Mortgage Loan or Loans, such substitution shall be effected by the
Seller delivering to the Trustee, for such Eligible Substitute Mortgage Loan or
Loans, the Mortgage Note, the Mortgage, the Assignment to the Trustee, and such
other documents and agreements, with all necessary endorsements thereon, as are
required by Section 2.01, together with an Officers' Certificate providing that
each such Eligible Substitute Mortgage Loan satisfies the definition thereof and
specifying the Substitution Adjustment Amount (as described below), if any, in
connection with such substitution. The Trustee shall acknowledge receipt for
such Eligible Substitute Mortgage Loan or Loans and, within ten Business Days
thereafter, shall review such documents as specified in Section 2.02 and deliver
to the Servicer, with respect to such Eligible Substitute Mortgage Loan or
Loans, a certification substantially in the form attached hereto as Exhibit F-1,
with any applicable exceptions noted thereon. Within one year of the date of
substitution, the Trustee shall deliver to the Servicer a certification
substantially in the form of Exhibit F-2 hereto with respect to such Eligible
Substitute Mortgage Loan or Loans, with any applicable exceptions noted thereon.
Monthly Payments due with respect to Eligible Substitute Mortgage Loans in the
month of substitution are not part of the Trust Fund and will be retained by the
Seller. For the month of substitution, distributions to Certificateholders will
reflect the collections and recoveries in respect of such Defective Mortgage
Loan in the Collection Period preceding the month of substitution and the
Depositor or the Seller, as the case may be, shall thereafter be entitled to
retain all amounts subsequently received in respect of such Defective Mortgage
Loan. The Seller shall give or cause to be given written notice to the
Certificateholders that such substitution has taken place, shall amend the
Mortgage Loan Schedule to reflect the removal of such Defective Mortgage Loan
from the terms of this Agreement and the substitution of the Eligible Substitute
Mortgage Loan or Loans and shall deliver a copy of such amended Mortgage Loan
Schedule to the Trustee. Upon such substitution, such Eligible Substitute
Mortgage Loan or Loans shall constitute part of the Mortgage Pool and shall be
subject in all respects to the terms of this Agreement and, in the case of a
substitution effected by the Seller, the Mortgage Loan Purchase Agreement,
including, in the case of a substitution effected by the Seller all applicable
representations and warranties thereof included in the Mortgage Loan Purchase
Agreement and all applicable representations and warranties thereof set forth in
Section 2.04, in each case as of the date of substitution.
For any month in which the Seller substitutes one or more Eligible
Substitute Mortgage Loans for one or more Defective Mortgage Loans, the Servicer
will determine the amount (the "Substitution Adjustment Amount"), if any, by
which the aggregate Purchase Price of all such Defective Mortgage Loans exceeds
the aggregate, as to each such Eligible Substitute Mortgage Loan, of the
principal balance thereof as of the date of substitution, together with one
month's interest on such principal balance at the applicable Mortgage Interest
Rate. On the date of such substitution, the Seller will deliver or cause to be
delivered to the Servicer for deposit in the Collection Account an amount equal
to the Substitution Adjustment Amount, if any, and the Trustee, upon receipt of
the related Eligible Substitute Mortgage Loan or Loans and certification by the
Servicer of such deposit, shall release to the Seller the related Mortgage File
or Files and shall execute and deliver such instruments of transfer or
assignment, in each case without recourse, as the Seller shall deliver to it and
as shall be necessary to vest therein any Defective Mortgage Loan released
pursuant hereto.
In addition, the Seller shall obtain at its own expense and deliver
to the Trustee an Opinion of Counsel to the effect that such substitution will
not cause (a) any federal tax to be imposed on the Trust Fund, including without
limitation, any federal tax imposed on "prohibited transactions" under Section
860F(a)(l) of the Code or on "contributions after the startup date" under
Section 860G(d)(l) of the Code, or (b) any REMIC to fail to qualify as a REMIC
at any time that any Certificate is outstanding. If such Opinion of Counsel can
not be delivered, then such substitution may only be effected at such time as
the required Opinion of Counsel can be given.
(e) Upon discovery by the Seller, the Servicer or the Trustee that
any Mortgage Loan does not constitute a "qualified mortgage" within the meaning
of Section 860G(a)(3) of the Code, the party discovering such fact shall within
two Business Days give written notice thereof to the other parties. In
connection therewith, the Seller shall repurchase or, subject to the limitations
set forth in Section 2.03(d), substitute one or more Eligible Substitute
Mortgage Loans for the affected Mortgage Loan within 90 days of the earlier of
discovery or receipt of such notice with respect to such affected Mortgage Loan.
In addition, upon discovery that a Mortgage Loan is defective in a manner that
would cause it to be a "defective obligation" within the meaning of Treasury
regulations relating to REMICs, the Seller shall cure the defect or make the
required purchase or substitution no later than 90 days after the discovery of
the defect. Any such repurchase or substitution shall be made in the same manner
as set forth in Section 2.03(a), if made by the Seller. The Trustee shall
reconvey to the Seller the Mortgage Loan to be released pursuant hereto in the
same manner, and on the same terms and conditions, as it would a Mortgage Loan
repurchased for breach of a representation or warranty.
Notwithstanding anything to the contrary contained herein, the
parties hereto acknowledge that the functions of the Trustee with respect to the
custody, acceptance, inspection and release of the Mortgage Files pursuant to
Sections 2.01, 2.02 and 2.03 and preparation and delivery of the certifications
in the form of Exhibit F-1 and Exhibit F-2 shall be performed by the Custodian
pursuant to the terms and conditions of the Custodial Agreement. The fees and
expenses of the Custodian shall be paid by the Servicer.
Section 2.04 Representations and Warranties of the Seller with
Respect to the Mortgage Loans.
The Seller hereby represents and warrants to the Trustee for the
benefit of the Certificateholders that as of the Closing Date or as of such
other date specifically provided herein:
(a) The representations and warranties made by the Seller pursuant
to Section 3.01 of the Mortgage Loan Purchase Agreement are hereby being made to
the Trustee and are true and correct as of the Closing Date.
(b) Any written agreement between the Mortgagor in respect of a
Mortgage Loan and the Servicer modifying such Mortgagor's obligation to make
payments under the Mortgage Loan (such modified Mortgage Loan, a "Modified
Mortgage Loan") involved the application of the Seller's underwriting standards
or some assessment of the Mortgagor's ability to repay the Modified Mortgage
Loan.
With respect to the representations and warranties set forth in this
Section 2.04 that are made to the best of the Seller's knowledge or as to which
the Seller has no knowledge, if it is discovered by the Depositor, the Seller,
the Servicer or the Trustee 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 interest therein of the
Certificateholders then, notwithstanding the Seller's lack of knowledge with
respect to the substance of such representation and warranty being inaccurate at
the time the representation or warranty was made, such inaccuracy shall be
deemed a breach of the applicable representation or warranty.
Upon discovery by the Depositor, the Seller, the Servicer or the
Trustee of a breach of any of the representations and warranties contained in
this Section that materially and adversely affects the value of any Mortgage
Loan or the interest therein of the Certificateholders, the party discovering
the breach shall give prompt written notice to the others and in no event later
than two Business Days from the date of such discovery. Within [ninety] days of
its discovery or its receipt of notice of any such missing or materially
defective documentation or any such breach of a representation or warranty, the
Seller shall promptly deliver such missing document or cure such defect or
breach in all material respects, or in the event such defect or breach cannot be
cured, the Seller shall repurchase the affected Mortgage Loan or cause the
removal of such Mortgage Loan from the Trust Fund and substitute for it one or
more Eligible Substitute Mortgage Loans, in either case, in accordance with
Section 2.03.
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 Trustee and shall inure to the benefit of the Certificateholders
notwithstanding any restrictive or qualified endorsement or assignment. It is
understood and agreed that the obligations of the Seller set forth in Section
2.03(a) to cure, substitute for or repurchase a Mortgage Loan pursuant to the
Mortgage Loan Purchase Agreement constitute the sole remedies available to the
Certificateholders or to the Trustee on their behalf respecting a breach of the
representations and warranties contained in this Section 2.04.
Section 2.05 Representations, Warranties and Covenants of the
Servicer.
The Servicer hereby represents, warrants and covenants to the
Trustee, for the benefit of each of the Trustee and the Certificateholders and
to the Depositor that as of the Closing Date or as of such date specifically
provided herein:
(i) The Servicer is duly organized, validly existing, and in good
standing under the laws of the jurisdiction of its formation and has all
licenses necessary to carry on its business as now being conducted, except
for such licenses, certificates and permits the absence of which,
individually or in the aggregate, would not have a material adverse effect
on the ability of the Servicer to conduct its business as it is presently
conducted, and is licensed, qualified and in good standing in the states
where the Mortgaged Property is located if the laws of such state require
licensing or qualification in order to conduct business of the type
conducted by the Servicer or to ensure the enforceability or validity of
each Mortgage Loan; the Servicer has the power and authority to execute
and deliver this Agreement and to perform in accordance herewith; the
execution, delivery and performance of this Agreement (including all
instruments of transfer to be delivered pursuant to this Agreement) by the
Servicer and the consummation of the transactions contemplated hereby have
been duly and validly authorized; this Agreement evidences the valid,
binding and enforceable obligation of the Servicer, subject to applicable
bankruptcy, insolvency, reorganization, moratorium or other similar laws
affecting the enforcement of creditors' rights generally; and all
requisite corporate action has been taken by the Servicer to make this
Agreement valid and binding upon the Servicer in accordance with its
terms;
(ii) The consummation of the transactions contemplated by this
Agreement are in the ordinary course of business of the Servicer and will
not result in the breach of any term or provision of the certificate of
formation or the partnership agreement of the Servicer or result in the
breach of any term or provision of, or conflict with or constitute a
default under or result in the acceleration of any obligation under, any
agreement, indenture or loan or credit agreement or other instrument to
which the Servicer or its property is subject, or result in the violation
of any law, rule, regulation, order, judgment or decree to which the
Servicer or its property is subject;
(iii) [Reserved];
(iv) This Agreement, and all documents and instruments
contemplated hereby which are executed and delivered by the Servicer,
constitute and will constitute valid, legal and binding obligations of the
Servicer, enforceable in accordance with their respective terms, except as
the enforcement thereof may be limited by applicable bankruptcy laws and
general principles of equity;
(v) The Servicer does not believe, nor does it have any reason or
cause to believe, that it cannot perform each and every covenant contained
in this Agreement;
(vi) There is no action, suit, proceeding or investigation
pending or, to its knowledge, threatened against the Servicer that, either
individually or in the aggregate, may result in any material adverse
change in the business, operations, financial condition, properties or
assets of the Servicer, or in any material impairment of the right or
ability of the Servicer to carry on its business substantially as now
conducted, or in any material liability on the part of the Servicer, or
that would draw into question the validity or enforceability of this
Agreement or of any action taken or to be taken in connection with the
obligations of the Servicer contemplated herein, or that would be likely
to impair materially the ability of the Servicer to perform under the
terms of this Agreement;
(vii) No consent, approval 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 by this Agreement, except
for such consents, approvals, authorizations and orders, if any, that have
been obtained;
(viii) Neither this Agreement nor any information, certificate of
an officer, statement furnished in writing or report delivered to the
Trustee by the Servicer in connection with the transactions contemplated
hereby contains or will contain any untrue statement of a material fact or
omits or will omit to state a material fact necessary in order to make the
statements contained therein, in light of the circumstances under which
they were made, not misleading; and
(ix) The Servicer covenants that its computer and other systems
used in servicing the Mortgage Loans are modified to operate in a manner
such that on and after January 1, 2000 (i) the Servicer can service the
Mortgage Loans in accordance with the terms of this Agreement and (ii) the
Servicer can operate its business in the same manner as it is operating on
the date hereof.
It is understood and agreed that the representations, warranties and
covenants set forth in this Section 2.05 shall survive delivery of the Mortgage
Files to the Trustee and shall inure to the benefit of the Trustee, the
Depositor and the Certificateholders. Upon discovery by any of the Depositor,
the Servicer, the Seller or the Trustee of a breach of any of the foregoing
representations, warranties and covenants which materially and adversely affects
the value of any Mortgage Loan or the interests therein of the
Certificateholders, the party discovering such breach shall give prompt written
notice (but in no event later than two Business Days following such discovery)
to the other parties hereto.
Section 2.06 Representations and Warranties of the Depositor.
The Depositor represents and warrants to the Trust and the Trustee
on behalf of the Certificateholders as follows:
(i) This agreement constitutes a legal, valid and binding
obligation of the Depositor, enforceable against the Depositor in
accordance with its terms, except as enforceability may be limited by
applicable bankruptcy, insolvency, reorganization, moratorium or other
similar laws now or hereafter in effect affecting the enforcement of
creditors' rights in general an except as such enforceability may be
limited by general principles of equity (whether considered in a
proceeding at law or in equity);
(ii) Immediately prior to the sale and assignment by the
Depositor to the Trustee on behalf of the Trust of each Mortgage Loan, the
Depositor had good and marketable title to each Mortgage Loan (insofar as
such title was conveyed to it by the Seller) subject to no prior lien,
claim, participation interest, mortgage, security interest, pledge, charge
or other encumbrance or other interest of any nature;
(iii) As of the Closing Date, the Depositor has transferred all
right, title interest in the Mortgage Loans to the Trustee on behalf of
the Trust;
(iv) The Depositor has not transferred the Mortgage Loans to the
Trustee on behalf of the Trust with any intent to hinder, delay or defraud
any of its creditors;
(v) The Depositor has been duly incorporated and is validly
existing as a corporation in good standing under the laws of the State of
Delaware, with full corporate power and authority to own its assets and
conduct its business as presently being conducted;
(vi) The Depositor is not in violation of its articles of
incorporation or by-laws or in default in the performance or observance of
any material obligation, agreement, covenant or condition contained in any
contract, indenture, mortgage, loan agreement, note, lease or other
instrument to which the Depositor is a party or by which it or its
properties may be bound, which default might result in any material
adverse changes in the financial condition, earnings, affairs or business
of the Depositor or which might materially and adversely affect the
properties or assets, taken as a whole, of the Depositor;
(vii) The execution, delivery and performance of this Agreement
by the Depositor, and the consummation of the transactions contemplated
thereby, do not and will not result in a material breach or violation of
any of the terms or provisions of, or, to the knowledge of the Depositor,
constitute a default under, any indenture, mortgage, deed of trust, loan
agreement or other agreement or instrument to which the Depositor is a
party or by which the Depositor is bound or to which any of the property
or assets of the Depositor is subject, nor will such actions result in any
violation of the provisions of the articles of incorporation or by-laws of
the Depositor or, to the best of the Depositor's knowledge without
independent investigation, any statute or any order, rule or regulation of
any court or governmental agency or body having jurisdiction over the
Depositor or any of its properties or assets (except for such conflicts,
breaches, violations and defaults as would not have a material adverse
effect on the ability of the Depositor to perform its obligations under
this Agreement);
(viii) To the best of the Depositor's knowledge without any
independent investigation, no consent, approval, authorization, order,
registration or qualification of or with any court or governmental agency
or body of the United States or any other jurisdiction is required for the
issuance of the Certificates, or the consummation by the Depositor of the
other transactions contemplated by this Agreement, except such consents,
approvals, authorizations, registrations or qualifications as (a) may be
required under State securities or Blue Sky laws, (b) have been previously
obtained or (c) the failure of which to obtain would not have a material
adverse effect on the performance by the Depositor of its obligations
under, or the validity or enforceability of, this Agreement; and
(ix) There are no actions, proceedings or investigations pending
before or, to the Depositor's knowledge, threatened by any court,
administrative agency or other tribunal to which the Depositor is a party
or of which any of its properties is the subject: (a) which if determined
adversely to the Depositor would have a material adverse effect on the
business, results of operations or financial condition of the Depositor;
(b) asserting the invalidity of this Agreement or the Certificates; (c)
seeking to prevent the issuance of the Certificates or the consummation by
the Depositor of any of the transactions contemplated by this Agreement,
as the case may be; (d) which might materially and adversely affect the
performance by the Depositor of its obligations under, or the validity or
enforceability of, this Agreement.
Section 2.07 Issuance of Certificates and the Uncertificated Regular
Interests.
The Trustee acknowledges the assignment to it of the Mortgage Loans
and the delivery to it (or the Custodian, as bailee and Custodian of the
Trustee) of the Mortgage Files, subject to the provisions of Sections 2.01 and
2.02, together with the assignment to it of all other assets included in the
Trust Fund, receipt of which is hereby acknowledged. Concurrently with such
assignment and delivery and in exchange therefor, the Trustee, pursuant to the
Written Order to Authenticate executed by an officer of the Depositor, has
executed, authenticated and delivered to or upon the order of the Depositor, the
Certificates (other than the Class BB, Class X and Class R Certificates) in
minimum dollar denominations or $25,000 and integral dollar multiples of $1,000
in excess. The Class BB, Class X and Class R Certificates are issuable only in
minimum Percentage Interests of 25%. The Trustee acknowledges the issuance of
the uncertificated REMIC I Regular Interests, the uncertificated REMIC II
Regular Interests and the uncertificated REMIC III Regular Interests, and
declares that it hold such regular interests as assets of REMIC 2, REMIC 3 and
REMIC 4, respectively. The Trustee acknowledges the issuance of the Class T4-A1A
Interest, and declares that it hold the same on behalf of the Holders of the
Class A-1A Certificates. The Trustee acknowledges the issuance of the REMIC 4
Components and the Class X/BB Interest, and declares that it holds the same on
behalf of the Holders of the Class BB and Class X Certificates. The interests
evidenced by the Certificates constitute the entire beneficial ownership
interest in the Trust Fund.
Section 2.08 Representations and Warranties of the Seller.
The Seller hereby represents and warrants to the Trust and the
Trustee on behalf of the Certificateholders that as of the Closing Date or as of
such date specifically provided herein:
(i) The Seller is duly organized, validly existing and in good
standing as a limited liability company under the laws of the State of
Delaware and has the power and authority to own its assets and to transact
the business in which it is currently engaged. The Seller is duly
qualified to do business and is in good standing in each jurisdiction in
which the character of the business transacted by it or properties owned
or leased by it requires such qualification and in which the failure to so
qualify would have a material adverse effect on (a) its business,
properties, assets or condition (financial or other), (b) the performance
of its obligations under this Agreement, (c) the value or marketability of
the Mortgage Loans, or (d) its ability to foreclose on the related
Mortgaged Properties.
(ii) The Seller has the power and authority to make, execute,
deliver and perform this Agreement and to consummate all of the
transactions contemplated hereunder and has taken all necessary action to
authorize the execution, delivery and performance of this Agreement. When
executed and delivered, this Agreement will constitute the Seller's legal,
valid and binding obligations enforceable in accordance with its terms,
except as enforcement of such terms may be limited by (1) bankruptcy,
insolvency, reorganization, receivership, moratorium or similar laws
affecting the enforcement of creditors' rights generally and by the
availability of equitable remedies, (2) general equity principals
(regardless of whether such enforcement is considered in a proceeding in
equity or at law) or (3) public policy considerations underlying the
securities laws, to the extent that such policy considerations limit the
enforceability of the provisions of this Agreement which purport to
provide indemnification from securities laws liabilities.
(iii) The Seller holds all necessary licenses, certificates and
permits from all governmental authorities necessary for conducting its
business as it is presently conducted, except for such licenses,
certificates and permits the absence of which, individually or in the
aggregate, would not have a material adverse effect on the ability of the
Seller to conduct its business as it is presently conducted. It is not
required to obtain the consent of any other party or any consent, license,
approval or authorization from, or registration or declaration with, any
governmental authority, bureau or agency in connection with the execution,
delivery, performance, validity or enforceability of this Agreement,
except for such consents, licenses, approvals or authorizations, or
registrations or declarations as shall have been obtained or filed, as the
case may be, prior to the Closing Date.
(iv) The execution, delivery and performance of this Agreement by
the Seller will not conflict with or result in a breach of, or constitute
a default under, any provision of any existing law or regulation or any
order or decree of any court applicable to the Seller or any of its
properties or any provision of its Limited Liability Company Agreement, or
constitute a material breach of, or result in the creation or imposition
of any lien, charge or encumbrance upon any of its properties pursuant to
any mortgage, indenture, contract or other agreement to which it is a
party or by which it may be bound.
(v) No certificate of an officer, written statement or report
delivered pursuant to the terms hereof by the Seller contains any untrue
statement of a material fact or omits to state any material fact necessary
to make the certificate, statement or report not misleading.
(vi) The transactions contemplated by this Agreement are in the
ordinary course of the Seller's business.
(vii) The Seller is not insolvent, nor will the Seller be made
insolvent by the transfer of the Mortgage Loans to the Depositor, nor is
the Seller aware of any pending insolvency.
(viii) The Seller is not in violation of, and the execution and
delivery of this Agreement by it and its performance and compliance with
the terms of this Agreement will not constitute a violation with respect
to any order or decree of any court, or any order or regulation of any
federal, state, municipal or governmental agency having jurisdiction,
which violation would materially and adversely affect the Seller's
condition (financial or otherwise) or operations or any of the Seller's
properties, or materially and adversely affect the performance of any of
its duties hereunder.
(ix) There are no actions or proceedings against, or
investigations of, the Seller pending or, to its knowledge, threatened,
before any court, administrative agency or other tribunal (i) that, if
determined adversely, would prohibit the Seller from entering into this
Agreement, (ii) seeking to prevent the consummation of any of the
transactions contemplated by this Agreement or (iii) that, if determined
adversely, would prohibit or materially and adversely affect the Seller's
performance of any of its respective obligations under, or the validity or
enforceability of, this Agreement.
(x) The Seller did not transfer the Mortgage Loans to the
Depositor with any intent to hinder, delay or defraud any of its
creditors.
(xi) The Seller acquired title to the Mortgage Loans in good
faith, without notice of any adverse claims.
(xii) The transfer, assignment and conveyance of the Mortgage
Notes and the Mortgages by the Seller to the Depositor are not subject to
the bulk transfer laws or any similar statutory provisions in effect in
any applicable jurisdiction.
Section 2.09 Covenants of the Seller.
(a) The Seller hereby covenants that except for the transfer
hereunder, the Seller will not sell, pledge, assign or transfer to any other
Person, or grant, create, incur, assume or suffer to exist any lien on any
Mortgage Loan, or any interest therein; the Seller will notify the Trustee, as
assignee of the Depositor, of the existence of any lien on any Mortgage Loan
immediately upon discovery thereof, and the Seller will defend the right, title
and interest of the Trust, as assignee of the Depositor, in, to and under the
Mortgage Loans, against all claims of third parties claiming through or under
the Seller; provided, however, that nothing in this Section 2.09 shall prevent
or be deemed to prohibit the Seller from suffering to exist upon any of the
Mortgage Loans any liens for municipal or other local taxes and other
governmental charges if such taxes or governmental charges shall not at the time
be due and payable or if the Seller shall currently be contesting the validity
thereof in good faith by appropriate proceedings and shall have set aside on its
books adequate reserves with respect thereto.
(b) The Seller hereby covenants that neither it nor any Affiliate of
the Seller will directly solicit any Mortgagor hereunder to refinance the
related Mortgage Loan. For the purposes of the foregoing, neither the Seller nor
any Affiliate of the Seller shall be deemed to directly solicit any Mortgagor if
the Seller responds to a request from a Mortgagor regarding a refinancing or if
the Mortgagor receives marketing materials which are generally disseminated.
Section 2.10 Repurchase of Originator Mortgage Loans.
The Depositor hereby assigns to the Trustee for the benefit of the
Certificateholders all of its right, title and interest in respect of its rights
against the Originator and Equicredit Corporation of America under the Seller
Warranty Certificate and the Originator Mortgage Loan Purchase Agreement. The
Trustee is not assuming any of the duties, liabilities or obligations of the
Depositor or Seller under the Seller Warranty Certificate or the Originator
Mortgage Loan Purchase Agreement. Insofar as the Originator Mortgage Loan
Purchase Agreement relates to the representations and warranties made by the
Originator in respect of any Originator Mortgage Loans and any remedies provided
thereunder for any breach of such representations and warranties or to the
guaranty of Equicredit Corporation of America and the enforcement thereof, such
right, title and interest may be enforced by the Trustee on behalf of the
Certificateholders. Upon discovery by the Depositor, the Seller, the Servicer or
the Trustee of a breach of any of the representations and warranties contained
in Section 5 of the Originator Mortgage Loan Purchase Agreement that materially
and adversely affects the value of any Originator Mortgage Loan or the interest
therein of the Certificateholders, the party discovering the breach shall give
prompt written notice to the other parties hereto and in no event later than two
Business Days from the date of such discovery. The Servicer shall promptly
notify the Originator of such breach and request that the Originator promptly
cure such breach in all material respects, or in the event such defect or breach
cannot be cured, repurchase the affected Mortgage Loan from the Trust Fund, in
accordance with Section 5 of the Originator Mortgage Loan Purchase Agreement.
The Purchase Price for the repurchased Originator Mortgage Loan shall be
deposited in the Collection Account, and the Trustee, upon receipt of written
certification from the Servicer of such deposit, shall release to the Originator
the related Originator Mortgage File and shall execute and deliver such
instruments of transfer or assignment, in each case without recourse, as the
Originator shall furnish to it and as shall be necessary to vest in the
Originator any Originator Mortgage Loan released pursuant hereto and the Trustee
shall have no further responsibility with regard to such Mortgage File.
It is understood and agreed that the representations and warranties
set forth in Section 5 of the Originator Mortgage Loan Purchase Agreement shall
survive delivery of the Mortgage Files to the Trustee and shall inure to the
benefit of the Certificateholders notwithstanding any restrictive or qualified
endorsement or assignment. It is understood and agreed that the obligations of
the Originator to cure or repurchase an Originator Mortgage Loan pursuant to the
Originator Mortgage Loan Purchase Agreement shall constitute the sole remedy
against the Originator respecting such breach available to the Trustee on behalf
of the Certificateholders.
ARTICLE III
ADMINISTRATION AND SERVICING
OF THE TRUST FUND
Section 3.01 Servicer to Act as Servicer.
The Servicer, as independent contract servicer, shall service and
administer the Mortgage Loans in accordance with this Agreement and the normal
and usual standards of practice of prudent mortgage servicers, and shall have
full power and authority, acting alone, to do or cause to be done any and all
things in connection with such servicing and administration which the Servicer
may deem necessary or desirable and consistent with the terms of this Agreement.
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
Certificateholders; provided, however, that the Servicer shall not make future
advances and (unless the Mortgagor is in default with respect to the Mortgage
Loan or such default is, in the judgment of the Servicer, imminent and the
Servicer has obtained the prior written consent of the Trustee) the Servicer
shall not permit any modification with respect to any Mortgage Loan that would
(i) change the Mortgage Interest Rate, defer or forgive the payment thereof of
any principal or interest payments, reduce the outstanding principal amount
(except for actual payments of principal) or extend the final maturity date with
respect to such Mortgage Loan, (ii) affect adversely the status of any REMIC as
a REMIC or (iii) cause any REMIC to be subject to a tax on "prohibited
transactions" or "contributions" pursuant to the REMIC Provisions.
Notwithstanding the foregoing, the Servicer shall not permit any modification
with respect to any Mortgage Loan that would both (x) effect an exchange or
reissuance of such Mortgage Loan under Section 1.860G-2(b) of the Treasury
Regulations and (y) cause any REMIC constituting part of the Trust Fund to fail
to qualify as a REMIC under the Code or the imposition of any tax on "prohibited
transactions" or "contributions" after the Startup Day under the REMIC
Provisions. 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 Trustee, 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 Property. The Servicer shall make all required Servicing Advances and
shall service and administer the Mortgage Loans in accordance with Applicable
Regulations, and shall provide to the Mortgagor any reports required to be
provided to them thereby. 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.
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 mortgage
servicing practices of prudent lending institutions, and the Certificateholders'
reliance on the Servicer.
The Servicer shall give prompt notice to the Trustee of any action,
of which the Servicer has actual knowledge, to (i) assert a claim against the
Trust Fund or (ii) assert jurisdiction over the Trust Fund.
Notwithstanding anything in this Agreement to the contrary, in the
event of a Principal Prepayment in full of a Mortgage Loan, the Servicer may not
waive any prepayment penalty or portion thereof required by the terms of the
related Mortgage Note unless (i) the Servicer determines that such waiver would
maximize recovery of Liquidation Proceeds for such Mortgage Loan, taking into
account the value of such prepayment penalty, or (ii) (A) the enforceability
thereof is limited (1) by bankruptcy, insolvency, moratorium, receivership, or
other similar law relating to creditors' rights generally or (2) due to
acceleration in connection with a foreclosure or other involuntary payment, or
(B) the enforceability is otherwise limited or prohibited by applicable law. In
the event of a Principal Prepayment in full with respect to any Mortgage Loan,
the Servicer shall deliver to the Trustee an Officer's Certificate substantially
in the form of Exhibit S no later than the third Business Day following the
immediately succeeding Determination Date with a copy to the Class X
Certificateholder. If the Servicer has waived all or a portion of a prepayment
penalty relating to a Principal Prepayment in full, other than as provided
above, the Servicer shall, within 90 days of the date on which the Principal
Prepayment in full is remitted to the Trustee, deposit the amount of such
prepayment penalty (or such portion thereof as had been waived) into the
Collection Account for distribution in accordance with the terms of this
Agreement.
With respect to each Mortgage Loan which is the subject of a
Principal Prepayment in full, which prepayment is not accompanied by the payment
of a prepayment penalty, the Trustee shall verify that such Mortgage Loan was
identified on the Mortgage Loan Schedule as not being subject to a prepayment
penalty. In the event that such Mortgage Loan is not so identified, the Trustee
shall provide written notice to the Seller and within 90 days of receipt of such
notice, the Seller shall remit to the Trustee for deposit in the Distribution
Account an amount equal to 50% of the product of (x) 80% of the Principal
Balance of the related Mortgage Loan immediately prior to the receipt of the
Principal Prepayment in full by the Servicer and (y) the applicable Mortgage
Interest Rate in effect on the date as to which interest was last covered by a
payment by the Mortgagor or an Advance by the Servicer.
In the event that the Class X Certificateholder provides written
notice to the Trustee that the type of prepayment penalty provided for in the
Mortgage Note for which the Servicer has received a Principal Prepayment in full
is inconsistent with the type of prepayment penalty set forth in the Mortgage
Loan Schedule and such inconsistency results in the receipt of a reduced
prepayment penalty, the Trustee shall provide such notice to the Seller. Within
90 days of receipt of such notice, the Seller shall remit to the Trustee for
deposit in the Distribution Account an amount equal to the difference between
the amount of the prepayment penalty paid pursuant to the terms of the related
Mortgage Note and the amount of the prepayment penalty determined in accordance
with the description thereof set forth in the Mortgage Loan Schedule.
Section 3.02 Collection of Mortgage Loan Payments.
Continuously from the date hereof until the principal and interest
on all Mortgage Loans are paid in full, the Servicer will diligently collect all
payments due under each Mortgage Loan when the same shall become due and payable
and shall, to the extent such procedures shall be consistent with this Agreement
and the terms and provisions of any related Primary Insurance Policy and
Applicable Regulations, follow such collection procedures as it follows with
respect to mortgage loans comparable to the Mortgage Loans and held for its own
account. Further, the Servicer will take special care in ascertaining and
estimating annual ground rents, taxes, assessments, water rates, fire and hazard
insurance premiums, mortgage insurance premiums, and all other charges that, as
provided in the Mortgage, will become due and payable to that end that the
installments payable by the Mortgagors will be sufficient to pay such charges as
and when they become due and payable.
Section 3.03 Realization Upon Defaulted Mortgage Loans.
In the event that any payment due under any Mortgage Loan 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 it shall deem to be in the best interest of the
Certificateholders.
In connection with a foreclosure or other conversion, the Servicer
shall exercise such rights and powers vested in it hereunder and use the same
degree of care and skill in its exercise as prudent mortgage servicers would
exercise or use under the circumstances in the conduct of their own affairs and
consistent with Applicable Regulations and the servicing standards set forth in
the FNMA Guide, including, without limitation, advancing funds for the payment
of taxes and insurance premiums.
Notwithstanding the foregoing provisions of this Section 3.03, with
respect to any Mortgage Loan as to which the Servicer has received actual notice
of, or has actual knowledge of, the presence of any toxic or hazardous substance
on the related Mortgaged Property, the Servicer shall not either (i) obtain
title to such Mortgaged Property as a result of or in lieu of foreclosure or
otherwise, or (ii) otherwise acquire possession of, or take any other action
with respect to, such Mortgaged Property if, as a result of any such action, the
Trust Fund would be considered to hold title to, to be a mortgagee-in-possession
of, or to be an owner or operator of such Mortgaged Property within the meaning
of the Comprehensive Environmental Response, Compensation and Liability Act of
1980, as amended from time to time, or any comparable law, unless the Servicer
has also previously determined, based on its reasonable judgment and a prudent
report prepared by a Person who regularly conducts environmental audits using
customary industry standards, that:
A. such Mortgaged Property is in compliance with applicable
environmental laws or, if not, that it would be in the best economic interest of
the Certificateholders to take such actions as are necessary to bring the
Mortgaged Property into compliance therewith; and
B. there are no circumstances present at such Mortgaged Property
relating to the use, management or disposal of any hazardous substances,
hazardous materials, hazardous wastes, or petroleum-based materials for which
investigation, testing, monitoring, containment, clean-up or remediation could
be required under any federal, state or local law or regulation, or that if any
such materials are present for which such action could be required, that it
would be in the best economic interest of the Certificateholders to take such
actions with respect to the affected Mortgaged Property.
The cost of the environmental audit report contemplated by this
Section 3.03 shall be advanced by the Servicer, subject to the Servicer's right
to be reimbursed therefor from the Collection Account as provided in Section
3.05(ii).
If the Servicer determines, as described above, that it is in the
best economic interest of the Certificateholders to take such actions as are
necessary to bring any such Mortgaged Property into compliance with applicable
environmental laws, or to take such action with respect to the containment,
clean-up or remediation of hazardous substances, hazardous materials, hazardous
wastes, or petroleum-based materials affecting any such Mortgaged Property, then
the Servicer shall take such action as it deems to be in the best economic
interest of the Certificateholders. The cost of any such compliance,
containment, cleanup or remediation shall be advanced by the Servicer, subject
to the Servicer's right to be reimbursed therefor from the Collection Account as
provided in Section 3.05(ii).
Section 3.04 Collection Account and Distribution Account.
(a) The Servicer shall segregate and hold all funds collected and
received pursuant to each Mortgage Loan separate and apart from any of its own
funds and general assets and shall establish and maintain one or more Collection
Accounts. Each Collection Account shall be an Eligible Account.
The Servicer shall deposit in the Collection Account on a daily
basis within two Business Days of receipt, and retain therein, the following
payments and collections received or made by it after the Cut-off Date with
respect to the Mortgage Loans:
(i) all payments on account of principal, including Principal
Prepayments, on the Mortgage Loans;
(ii) all payments on account of interest on the Mortgage Loans
adjusted to the Mortgage Interest Rate less the Servicing Fee Rate;
(iii) all proceeds from a Cash Liquidation;
(iv) all Insurance Proceeds including amounts required to be
deposited pursuant to Sections 3.10 and 3.11, other than proceeds to be
held in the Escrow Account and applied to the restoration or repair of the
Mortgaged Property or released to the Mortgagor in accordance with the
Servicer's normal servicing procedures, the loan documents or applicable
law;
(v) all Condemnation Proceeds affecting any Mortgaged Property
which are not released to the Mortgagor in accordance with the Servicer's
normal servicing procedures, the loan documents or applicable law;
(vi) any amounts required to be deposited by the Servicer
pursuant to Section 3.11 in connection with the deductible clause in any
blanket hazard insurance policy, such deposit being made from the
Servicer's own funds, without reimbursement therefor;
(vii) any amounts required to be deposited by the Servicer in
connection with any REO Property pursuant to Section 3.13;
(viii) any amounts required to be deposited in the Collection
Account pursuant to Sections 2.03, 2.10, 3.04, 3.16, 3.23 or 4.07; and
(ix) any prepayment penalties and premiums or amounts required to
be deposited in connection with the waiver of such prepayment penalties
pursuant to Section 3.01.
Any interest paid on funds deposited in the Collection Account,
subject to Section 3.25, shall accrue to the benefit of the Servicer and the
Servicer shall be entitled to retain and withdraw such interest from the
Collection Account pursuant to Section 3.05(v). The foregoing requirements for
deposit from 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, prepayment charges that are not prepayment
penalties, and assumption fees need not be deposited by the Servicer in the
Collection Account.
(b) On behalf of the Trust Fund, the Trustee shall establish and
maintain one or more accounts (such account or accounts, the "Distribution
Account"), held in trust for the benefit of the Certificateholders. On behalf of
the Trust Fund, the Servicer shall deliver to the Trustee in immediately
available funds for deposit in the Distribution Account by the close of business
New York time on the Servicer Remittance Date, that portion of the Available
Funds (calculated without regard to the references in the definition thereof to
amounts that may be deposited to the Distribution Account from a different
source as provided herein) then on deposit in the Collection Account. The
Trustee shall maintain subaccounts of the Distribution Account for each of REMIC
1, REMIC 2, REMIC 3, REMIC 4 and the Class X/BB Interest to account for the
payments in respect of each REMIC and on the Class X and Class BB Certificates.
(c) Funds in the Collection Account and the Distribution Account may
be invested in Permitted Investments in accordance with the provisions set forth
in Section 3.25. The Servicer shall give notice to the Trustee of the location
of the Collection Account maintained by it when established and prior to any
change thereof. The Trustee shall give notice to the Servicer and the Depositor
of the location of the Distribution Account when established and prior to any
change thereof.
(d) In the event the Servicer shall deliver to the Trustee for
deposit in the Distribution Account any amount not required to be deposited
therein, it may at any time request that the Trustee withdraw such amount from
the Distribution Account and remit to the Servicer any such amount, any
provision herein to the contrary notwithstanding. In addition, the Servicer
shall deliver to the Trustee from time to time for deposit, and the Trustee
shall so deposit, in the Distribution Account in respect of REMIC 1:
(i) any Advances, as required pursuant to Section 4.07;
(ii) any Stayed Funds, as soon as permitted by the federal
bankruptcy court having jurisdiction in such matters; and
(iii) any prepayment penalties and premiums required to be
deposited pursuant to Section 3.01.
(e) Promptly upon receipt of any Stayed Funds, whether from the
Servicer, a trustee in bankruptcy, or federal bankruptcy court or other source,
the Trustee shall notify the Servicer of such receipt and deposit such funds in
the Distribution Account, subject to withdrawal thereof as permitted hereunder.
In addition, the Trustee shall deposit in the Distribution Account any amounts
required to be deposited pursuant to Section 3.15 in connection with losses
realized on Permitted Investments with respect to funds held in the Distribution
Account.
Section 3.05 Permitted Withdrawals From the Collection Account.
The Servicer may, from time to time, withdraw from the Collection
Account for the following purposes:
(i) to remit to the Trustee for deposit in the Distribution
Account the amounts required to be so remitted pursuant to
Section 3.04(b) or permitted to be so remitted pursuant to the
first sentence of Section 3.04(d);
(ii) to reimburse itself for advances of Servicer funds made
pursuant to Section 3.01, 3.03 or 4.07, the Servicer's right
to reimburse itself pursuant to this subclause (ii) being
limited to amounts received on the related Mortgage Loan which
represent payments of principal and/or interest respecting
which any such advance was made;
(iii) to reimburse itself for unreimbursed Servicing Advances, any
unpaid Servicing Fees and for unreimbursed advances of
Servicer funds made pursuant to Section 4.07 to the extent
that such amounts are deemed to be Nonrecoverable Advances,
and to reimburse itself for such amounts to the extent that
such amounts are nonrecoverable from the disposition of REO
Property pursuant to Section 3.03 or Section 3.13 hereof;
(iv) to reimburse itself for any amounts paid pursuant to Section
3.03 (and not otherwise previously reimbursed);
(v) to pay to itself as servicing compensation (a) any interest
earned on funds in the Collection Account (all such interest
to be withdrawn monthly not later than each Servicer
Remittance Date) and (b) the Servicing Fee from that portion
of any payment or recovery as to interest to a particular
Mortgage Loan to the extent not retained pursuant to Section
3.04(ii);
(vi) to pay the PMI Insurer the PMI Fee; and
(vii) to clear and terminate the Collection Account upon the
termination of this Agreement.
The foregoing requirements for withdrawal from the Collection
Account shall be exclusive. In the event the Servicer shall deposit in the
Collection Account any amount not required to be deposited therein, it may at
any time withdraw such amount from the Collection Account, any provision herein
to the contrary notwithstanding.
Section 3.06 Establishment of Escrow Accounts; Deposits in Escrow
Accounts.
The Servicer shall segregate and hold all funds collected and
received pursuant to each Mortgage Loan which constitute 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. A copy of such letter agreement shall be furnished to the
Trustee upon request. The Escrow Account shall be an Eligible Account.
The Servicer shall deposit in the Escrow Account or Accounts on a
daily basis within two Business Days of 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 Insurance Proceeds which are to be applied to the
restoration or repair of any Mortgaged Property. The Servicer shall make
withdrawals therefrom only to effect such payments as are required under this
Agreement, and for such other purposes as shall be set forth in, or in
accordance with, Section 3.07. 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 and, to the extent required by the related Mortgage Loan or
Applicable Regulations, the Servicer shall pay interest on escrowed funds to the
Mortgagor notwithstanding that the Escrow Account is non-interest bearing or
that interest paid thereon is insufficient for such purposes.
Section 3.07 Permitted Withdrawals From Escrow Account.
Withdrawals from the Escrow Account may be made by the Servicer (i)
to effect timely payments of ground rents, taxes, assessments, water rates,
fire, flood and hazard insurance premiums, Primary Insurance Policy premiums, if
applicable, and comparable items, (ii) to reimburse the Servicer for any
Servicing Advance made by the Servicer with respect to a related Mortgage Loan
but only from amounts received on the related Mortgage Loan which represent late
payments or Late Collections of Escrow Payments thereunder, (iii) to refund to
the Mortgagor any funds as may be determined to be overages, (iv) for transfer
to the Collection Account in accordance with the terms of this Agreement, (v)
for application to restoration or repair of the Mortgaged Property, (vi) to pay
to the Servicer, or to the Mortgagor to the extent required by the related
Mortgage Loan or Applicable Regulations, any interest paid on the funds
deposited in the Escrow Account, (vii) to clear and terminate the Escrow Account
on the termination of this Agreement, or (viii) to transfer to the Collection
Account any insurance proceeds. As part of its servicing duties, the Servicer
shall pay to the Mortgagor interest on funds in the Escrow Account, to the
extent required by the related Mortgage Loan or Applicable Regulations, and to
the extent that interest earned on funds in the Escrow Account is insufficient,
shall pay such interest from its own funds, without any reimbursement therefor.
In the event the Servicer shall deposit in the Escrow Account any
amount not required to be deposited therein, it may at any time withdraw such
amount from the Escrow Account, any provision herein to the contrary
notwithstanding.
Section 3.08 Payment of Taxes, Insurance and Other Charges;
Maintenance of Primary Insurance Policies; Collections Thereunder.
With respect to each Mortgage Loan, the Servicer shall maintain
accurate records reflecting the status of ground rents, taxes, assessments,
water rates and other charges which are or may become a lien upon the Mortgaged
Property and the status of Primary Insurance Policy premiums and fire, flood 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 and at a time
appropriate for securing maximum discounts allowable, 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 or Applicable Regulations. To the extent
that the Mortgage does not provide for Escrow Payments, the Servicer shall
determine that any such payments are made by the Mortgagor at the time they
first become due. The Servicer assumes full responsibility for the timely
payment of all such bills and shall effect timely payments of all such bills
irrespective of the Mortgagor's faithful performance in the payment of same or
the making of the Escrow Payments and shall make Servicing Advances from its own
funds to effect such payments.
The Servicer, on behalf of the Trustee, as mortgagee, will maintain
in full force and effect (to the extent a Mortgage Loan has a Primary Insurance
Policy) a Primary Insurance Policy issued by a Qualified Insurer with respect to
each Mortgage Loan for which such coverage is required. Such coverage will be
maintained until the Loan-to-Value Ratio of the related Mortgage Loan is reduced
to 80% or less. The Servicer will not cancel or refuse to renew any Primary
Insurance Policy in effect on the Closing Date that is required to be kept in
force under this Agreement unless a replacement Primary Insurance Policy for
such cancelled or non-renewed policy is obtained from and maintained with a
Qualified Insurer. The Servicer shall not take any action which would result in
non-coverage 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 3.14, 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 policy and
shall take all actions which may be required by such insurer as a condition to
the continuation of coverage under the 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 Trustee, claims to the
insurer under any Primary Insurance Policy in a timely fashion in accordance
with the terms of such policies 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 3.04, any amounts
collected by the Servicer under any Primary Insurance Policy shall be deposited
in the Collection Account, subject to withdrawal pursuant to Section 3.05.
Section 3.09 Transfer of Accounts.
The Servicer may transfer the Collection Account or the Escrow
Account to a different depository institution from time to time. Upon such
transfer, the Servicer shall deliver to the Trustee and the Depositor, a
certification or letter agreement, as the case may be, as required pursuant to
Sections 3.04 and 3.06.
Section 3.10 Maintenance of Hazard Insurance.
The Servicer shall cause to be maintained for each Mortgage Loan
fire and hazard insurance with extended coverage as is customary in the area
where the Mortgaged Property is located in an amount which is at least equal to
the lesser of (i) the amount necessary to fully compensate for any damage or
loss to the improvements which are a part of such property on a replacement cost
basis or (ii) the Principal Balance of the Mortgage Loan, in each case in an
amount not less than such amount as is necessary to prevent the Mortgagor and/or
the Mortgagee from becoming a co-insurer. If the Mortgaged Property is in an
area identified in the Federal Register by the Flood Emergency Management Agency
as having special flood hazards and flood insurance has been made available, the
Servicer will cause to be maintained a flood insurance policy meeting the
requirements of the current guidelines of the Federal Insurance Administration
with a generally acceptable insurance carrier, in an amount representing
coverage not less than the least of (i) the Principal Balance of the Mortgage
Loan, (ii) the maximum insurable value of the improvements securing such
Mortgage Loan or (iii) the maximum amount of insurance which is available under
the Flood Disaster Protection Act of 1973, as amended. The Servicer shall also
maintain on the REO Property for the benefit of the Certificateholders, (x) fire
and hazard insurance with extended coverage in an amount which is at least equal
to the replacement cost of the improvements which are a part of such property,
(y) public liability insurance and, (z) to the extent required and available
under the Flood Disaster Protection Act of 1973, as amended, flood insurance in
an amount as provided above. 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 Mortgaged Property or REO Property,
or released to the Mortgagor in accordance with the Servicer's normal servicing
procedures, shall be deposited in the Collection Account, subject to withdrawal
pursuant to Section 3.05. It is understood and agreed that no earthquake or
other additional insurance is required to be maintained by the Servicer or the
Mortgagor or maintained on property acquired in respect of the Mortgage Loan,
other than pursuant to such Applicable Regulations as shall at any time be in
force and as shall require such additional insurance. All such policies shall be
endorsed with standard mortgagee clauses with loss payable to the Servicer and
shall provide for at least thirty days prior written notice of any cancellation,
reduction in the amount of or material change in coverage to the Servicer. 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 currently reflect a general policy rating of B:VI or better in
Best's Key Rating Guide and are licensed to do business in the state wherein the
property subject to the policy is located.
Section 3.11 Maintenance of Mortgage Impairment Insurance Policy.
In the event that the Servicer shall obtain and maintain a blanket
policy issued by an insurer that has a general policy rating of B:VI or better
in Best's Key Rating Guide insuring against hazard losses 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 3.10 and otherwise complies with all
other requirements of Section 3.10, it shall conclusively be deemed to have
satisfied its obligations as set forth in Section 3.10, it being understood and
agreed that such policy may contain a deductible clause, in which case the
Servicer shall, in the event that there shall not have been maintained on the
related Mortgaged Property or REO Property a policy complying with Section 3.10,
and there shall have been a loss which would have been covered by such policy,
deposit in the Collection Account the amount not otherwise payable under the
blanket policy because of such deductible clause, which amount shall not be
reimbursable to the Servicer from the Trust Fund. In connection with its
activities as servicer of the Mortgage Loans, the Servicer agrees to prepare and
present, on behalf of the Trustee, claims under any such blanket policy in a
timely fashion in accordance with the terms of such policy. Upon request of the
Trustee, the Servicer shall cause to be delivered to the Trustee a certified
true copy of such policy and a statement from the insurer thereunder that such
policy shall in no event be terminated or materially modified without thirty
days prior written notice to the Trustee.
Section 3.12 Fidelity Bond, Errors and Omissions Insurance.
--
The Servicer shall maintain, at its own expense, a blanket fidelity
bond (the "Fidelity Bond") and an errors and omissions insurance policy, with
broad coverage with financially responsible companies on all officers, employees
or other persons acting in any capacity with regard to the Mortgage Loans to
handle funds, money, documents and papers relating to the Mortgage Loans. The
Fidelity Bond and errors and omissions insurance 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 persons. Such Fidelity Bond shall also protect and insure
the Servicer against losses in connection with the failure to maintain any
insurance policies required pursuant to this Agreement and the release or
satisfaction of a Mortgage Loan without having obtained payment in full of the
indebtedness secured thereby. No provision of this Section 3.12 requiring the
Fidelity Bond and errors and omissions insurance shall diminish or relieve the
Servicer from its duties and obligations as set forth in this Agreement. The
minimum coverage under any such bond and insurance policy shall be at least
equal to the corresponding amounts required by FNMA in the FNMA MBS Selling and
Servicing Guide or by FHLMC in the FHLMC Servicer's Guide. Upon request of the
Trustee, the Servicer shall cause to be delivered to the Trustee a certified
true copy of the 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 thirty days' prior written notice to the Trustee.
Section 3.13 Title, Management and Disposition of REO Property.
(a) In the event that title to a Mortgaged Property is acquired in
foreclosure or by deed in lieu of foreclosure, the deed or certificate of sale
shall be taken (pursuant to a limited power of attorney to be provided by the
Trustee to the Servicer after receipt of an Officer's Certificate from the
Servicer) in the name of the Trustee, on behalf of the Certificateholders, or in
the event the Trustee is not authorized or permitted to hold title to real
property in the state where the REO Property is located, or would be adversely
affected under the "doing business" or tax laws of such state by so holding
title, the deed or certificate of sale shall be taken in the name of such Person
or Persons as shall be consistent with an Opinion of Counsel obtained by the
Servicer from an attorney duly licensed to practice law in the state where the
REO Property is located. Any Person or Persons holding such title other than the
Trustee shall acknowledge in writing that such title is being held as nominee
for the benefit of the Trustee.
(b) In the event that the Trust Fund acquires any REO Property as
aforesaid or otherwise in connection with a default or imminent default on a
Mortgage Loan, the Servicer shall dispose of such REO Property before the end of
the third calendar year beginning after the year of its acquisition by the Trust
Fund for purposes of Section 860G(a)(8) of the Code or, at the expense of the
Trust Fund, request from the Internal Revenue Service, more than 60 days before
the day on which the above-mentioned grace period would otherwise expire, an
extension of the above-mentioned grace period, unless the Servicer obtains an
Opinion of Counsel, addressed to the Servicer and the Trustee, to the effect
that the holding by the Trust Fund of such REO Property subsequent to such
period will not: (i) result in the imposition of any tax on "prohibited
transactions" as defined in Section 860F of the Code; or (ii) cause any REMIC
constituting any part of the Trust Fund to fail to qualify as a REMIC at any
time that any Certificates are outstanding, in which case the Trust Fund may
continue to hold such REO Property (subject to any conditions contained in such
Opinion of Counsel). The Servicer shall be entitled to be reimbursed from the
Collection Account for any costs incurred in obtaining such Opinion of Counsel,
as provided in Section 3.05.
Subject to compliance with applicable laws and regulations as shall
at any time be in force, and notwithstanding any other provisions of this
Agreement, no REO Property acquired by the Trust Fund shall be rented (or
allowed to continue to be rented) or otherwise used by or on behalf of the Trust
Fund in such a manner or pursuant to any terms that would: (i) cause such REO
Property to fail to qualify as "foreclosure property" within the meaning of
Section 860G(a)(8) of the Code; or (ii) subject any REMIC constituting part of
the Trust Fund to the imposition of any federal income taxes on the income
earned from such REO Property, including any taxes imposed by reason of Sections
860F or 860G(c) of the Code, unless the Servicer has agreed to indemnify and
hold harmless the Trust Fund with respect to the imposition of any such taxes.
The Servicer shall manage, conserve, protect and operate each REO
Property for the Certificateholders and the Trust Fund solely for the purpose of
its prompt disposition and sale in a manner which does not cause such REO
Property to fail to qualify as "foreclosure property" within the meaning of
Section 860G(a)(8) of the Code or result in the receipt by the related REMIC of
any "income from non-permitted assets" within the meaning of Section
860F(a)(2)(B) of the Code, or any "net income from foreclosure property" which
is subject to taxation under the REMIC Provisions. The Servicer shall cause each
REO Property to be inspected promptly upon the acquisition of title thereto and
shall cause each REO Property to be inspected at least annually thereafter. The
Servicer shall make or cause to be made a written report of each such
inspection. Such reports shall be retained in the Mortgage Servicing File and
copies thereof shall be forwarded by the Servicer to the Trustee upon request.
The Servicer shall attempt to sell the same (and may temporarily rent the same)
on such terms and conditions as the Servicer deems to be in the best interest of
the Certificateholders and the Trust Fund.
With respect to each REO Property, the Servicer shall segregate and
hold all funds collected and received in connection with the operation of the
REO Property separate and apart from its own funds or general assets and shall
establish and maintain with respect to all REO Property an REO Account or
Accounts in the form of a time deposit or demand account, unless an Opinion of
Counsel is obtained by the Servicer to the effect that the classification as a
REMIC for federal income tax purposes of the arrangement under which the
Mortgage Loans and the REO Property is held will not be adversely affected by
holding such funds in another manner. Such REO Account shall be established with
the Servicer or with a commercial bank, a mutual savings bank or a savings and
loan association. The creation of any REO Account shall be evidenced by a letter
agreement, in the case of an account held by a depository. In either case, an
original of such certification or letter agreement shall be furnished to the
Trustee upon request.
The Servicer shall deposit or cause to be deposited, on a daily
basis in each REO Account, all revenues received with respect to the related REO
Property and shall withdraw therefrom funds necessary for the proper operation,
management and maintenance of the REO Property, including the cost of
maintaining any hazard insurance pursuant to Section 3.10 hereof and the fees of
any managing agent acting on behalf of the Servicer. The Servicer shall have the
right to earn interest, if any, on funds deposited in such REO Account. On or
before each Determination Date, the Servicer shall withdraw from each REO
Account and deposit into the Collection Account the net receipts from the REO
Property on deposit in the REO Account and retain any interest.
The Servicer shall furnish to the Trustee, on each Servicer
Remittance Date, an operating statement for each REO Property covering the
operation of each REO Property for the previous month. Such operation statement
shall be accompanied by such other information as the Trustee shall reasonably
request.
The Servicer shall use its best efforts to dispose of the REO
Property as promptly as is practically consistent with protecting the
Certificateholders' interests.
Each REO Disposition shall be carried out by the Servicer at such
price and upon such terms and conditions as the Servicer deems to be in the best
interest of the Certificateholders. If as of the date title to any REO Property
was acquired by the Servicer there were outstanding unreimbursed Servicing
Advances with respect to the REO Property, the Servicer, upon an REO Disposition
of such REO Property, shall be entitled to reimbursement for any related
unreimbursed Servicing Advances from proceeds received in connection with such
REO Disposition. The proceeds from the REO Disposition, net of any payment to
the Servicer as provided above, shall be deposited in the REO Account and shall
be transferred to the Collection Account on the Determination Date in the month
following receipt thereof for distribution on the succeeding Servicer Remittance
Date in accordance with Section 4.01.
Any REO Disposition shall be for cash only (unless changes in the
REMIC Provisions made subsequent to the Startup Day allow a sale for other
consideration and an Opinion of Counsel is obtained by the Servicer to the
effect that such sale shall not cause any REMIC constituting part of the Trust
Fund to fail to qualify as a REMIC).
Section 3.14 Due-on-Sale Clauses; Assumption and Substitution
Agreements.
When a Mortgaged Property has been or is about to be conveyed by the
Mortgagor, the Servicer shall, to the extent it has knowledge of such conveyance
or prospective conveyance, exercise its rights to accelerate the maturity of the
related Mortgage Loan under any "due-on-sale" clause contained in the related
Mortgage or Mortgage Note; provided, however, that the Servicer shall not
exercise any such right if the "due-on-sale" clause, in the reasonable belief of
the Servicer, is not enforceable under applicable law. An Opinion of Counsel at
the expense of the Servicer (which expense shall constitute a Servicing Advance)
delivered to the Trustee and the Depositor to the foregoing effect shall
conclusively establish the reasonableness of such belief. In such event, the
Servicer shall make reasonable efforts to enter into an assumption and
modification agreement with the Person to whom such property has been or is
about to be conveyed, pursuant to which such Person becomes liable under the
Mortgage Note and, unless prohibited by applicable law or the Mortgage, the
Mortgagor remains liable thereon. If the foregoing is not permitted under
applicable law, the Servicer is authorized to enter into a substitution of
liability agreement with such Person, pursuant to which the original Mortgagor
is released from liability and such Person is substituted as Mortgagor and
becomes liable under the Note. The Mortgage Loan, as assumed, shall conform in
all respects to the requirements, representations and warranties of this
Agreement. The Servicer shall notify the Trustee that any such assumption or
substitution agreement has been completed by forwarding to the Trustee (or the
Custodian, as the case may be) the original copy of such assumption or
substitution agreement (indicating the Mortgage File to which it relates) which
copy shall be added by the Trustee (or the Custodian, as the case may be) to the
related Mortgage File and which shall, for all purposes, be considered a part of
such Mortgage File to the same extent as all other documents and instruments
constituting a part thereof. The Servicer shall be responsible for recording any
such assumption or substitution agreements. In connection with any such
assumption or substitution agreement, the Monthly Payment on the related
Mortgage Loan shall not be changed but shall remain as in effect immediately
prior to the assumption or substitution, the stated maturity or outstanding
principal amount of such Mortgage Loan shall not be changed nor shall any
required monthly payments of principal or interest be deferred or forgiven. Any
fee collected by the Servicer for consenting to any such conveyance or entering
into an assumption or substitution agreement shall be retained by or paid to the
Servicer as additional servicing compensation.
Notwithstanding the foregoing paragraph or any other provision of
this Agreement, the Servicer shall not be deemed to be in default, breach or any
other violation of its obligations hereunder by reason of any assumption of a
Mortgage Loan by operation of law or any assumption which the Servicer may be
restricted by law from preventing, for any reason whatsoever.
Section 3.15 [Reserved].
Section 3.16 Optional and Mandatory Purchases of Mortgage Loans by
Seller.
(a) The Seller may, at its option, repurchase a Mortgage Loan which
becomes 60 or more days delinquent or for which the Servicer has accepted a deed
in lieu of foreclosure. Prior to repurchase pursuant to this Section 3.16, the
Servicer shall be required to continue to make monthly advances pursuant to
Section 4.07. The Seller shall not use any procedure in selecting Mortgage Loans
to be repurchased which is materially adverse to the interests of the
Certificateholders. The Seller shall purchase such delinquent Mortgage Loan at a
price equal to the Principal Balance of the Mortgage Loan plus accrued interest
thereon at the Mortgage Interest Rate from the date to which interest has last
been paid to the Trust Fund to the date of purchase plus any unreimbursed
Servicing Advances. Any such repurchase of a Mortgage Loan pursuant to this
Section 3.16 shall be accomplished by deposit in the Collection Account of the
amount of the purchase price. The Trustee shall immediately effectuate the
conveyance of such delinquent Mortgage Loan to the Seller to the extent
necessary, including the prompt delivery of all documentation to the Seller.
(b) [Reserved].
(c) Any repurchase of a Mortgage Loan pursuant to this Section 3.16
shall be accomplished by deposit in the Collection Account of the amount of the
Purchase Price. The Trustee shall thereupon effectuate the conveyance of such
repurchased Mortgage Loan to the Seller to the extent necessary, including the
prompt delivery of all documentation to the Seller.
Section 3.17 Trustee to Cooperate; Release of Files.
(a) Upon the payment in full of any Mortgage Loan (including any
liquidation of such Mortgage Loan through foreclosure or otherwise, 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 shall deliver to the
Trustee (or the Custodian as the case may be) two executed copies of a completed
"Request for Release" in the form of Exhibit E. Upon receipt of such Request for
Release of Documents, the Trustee (or the Custodian as the case may be) shall
promptly release the related Mortgage File, in trust to (i) the Servicer, or
(ii) such other party identified in the related Request for Release. Upon any
such payment in full, or the receipt of such notification that such funds have
been placed in escrow, the Servicer shall direct the Trustee in writing to
execute an instrument of satisfaction (or assignment of Mortgage without
recourse) regarding the Mortgaged Property relating to such Mortgage, which
instrument of satisfaction or assignment, as the case may be, shall be delivered
to the Person or Persons entitled thereto against receipt therefor of payment in
full, it being understood and agreed that no expense incurred in connection with
such instrument of satisfaction or assignment, as the case may be, shall be
chargeable to the Collection Account. In lieu of executing any such satisfaction
or assignment, as the case may be, the Servicer may prepare and submit to the
Trustee a satisfaction (or assignment without recourse, if requested by the
Person or Persons entitled thereto) in form for execution by the Trustee with
all requisite information completed by the Servicer; in such event, the Trustee
shall execute and acknowledge such satisfaction or assignment, as the case may
be, and deliver the same with the related Mortgage File, as aforesaid.
(b) From time to time and as appropriate in the servicing of any
Mortgage Loan, including, without limitation, foreclosure or other comparable
conversion of a Mortgage Loan or collection under any insurance policy relating
to a Mortgage Loan, the Trustee shall (except in the case of the payment or
liquidation pursuant to which the related Mortgage File is released to an escrow
agent or an employee, agent or attorney of the Trustee), upon written request of
the Servicer and delivery to the Trustee (or the Custodian, as the case may be)
of two executed copies of a "Request for Release" in the form of Exhibit E
signed by a Servicing Officer, release the related Mortgage File to the Servicer
and shall execute such documents as shall be necessary to the prosecution of any
such proceedings, including, without limitation, an assignment without recourse
of the related Mortgage to the Servicer. Such receipt shall obligate the
Servicer to return the Mortgage File to the Trustee (or the Custodian, as the
case may be) when the need therefor by the Servicer no longer exists unless the
Mortgage Loan shall be liquidated, in which case, upon receipt of a Request for
Release evidencing such liquidation, the receipt shall be released by the
Trustee (or the Custodian, as the case may be) to the Servicer.
(c) Subject to Section 3.01, the Servicer shall have the right to
accept applications of Mortgagors for consent to (i) partial releases of
Mortgages, (ii) alterations, (iii) removal, demolition or division of properties
subject to Mortgages and (iv) second mortgage subordination agreements. No
application for approval shall be considered by the Servicer unless: (w) it has
received an Opinion of Counsel, addressed to the Trustee (which opinion shall
not be an expense of the Trustee or the Trust Fund) that such sale, disposition,
substitution, acquisition or contribution will not affect adversely the status
of any REMIC constituting part of the Trust Fund as a REMIC or cause any REMIC
constituting part of the Trust Fund to be subject to a tax on "prohibited
transactions" or "contributions" pursuant to the REMIC Provisions; (x) the
provisions of the related Note and Mortgage have been complied with; (y) the
Loan-to-Value Ratio and debt-to-income ratio after any release does not exceed
the maximum Loan-to-Value Ratio and debt-to-income ratio established in
accordance with the underwriting standards of the Mortgage Loans; and (z) the
lien priority of the related Mortgage is not affected. Upon receipt by the
Trustee of a Servicing Officer's certificate setting forth the action proposed
to be taken in respect of a particular Mortgage Loan and certifying that the
criteria set forth in the immediately preceding sentence have been satisfied,
the Trustee shall execute and deliver to the Servicer the consent or partial
release so requested by the Master Server. A proposed form of consent or partial
release, as the case may be, shall accompany any Servicing Officer's certificate
delivered by the Master Server pursuant to this paragraph.
Section 3.18 Servicing Compensation.
As compensation for its activities hereunder, the Servicer shall be
entitled to retain the amount of the Servicing Fee with respect to each Mortgage
Loan. The Servicer shall be entitled to retain additional servicing compensation
in the form of release fees, bad check charges, assumption fees, modification or
extension fees, late payment charges, or any other service-related fees,
Insurance Proceeds and Liquidation Proceeds not required to be deposited in the
Collection Account and similar items, to the extent collected from Mortgagors.
Additionally, the Servicer shall be entitled to the Special Servicing Fee,
payable in accordance with Section 4.02.
Section 3.19 Annual Statement as to Compliance.
(a) The Servicer, at its own expense, will deliver to the Trustee
and the Depositor, not later than 90 days following the end of the fiscal year
of the Servicer which as of the Startup Day ends on the last day of December,
commencing in 2000, a Servicing Officer's certificate stating, as to each signer
thereof, that (i) a review of the activities of the Servicer during such
preceding fiscal year (or such shorter period in the case of the first such
report) and of performance under this Agreement has been made under such
officers' supervision, and (ii) to the best of such officers' knowledge, based
on such review, the Servicer has fulfilled all its obligations under this
Agreement for such year, or, if there has been a default in the fulfillment of
all such obligations, specifying each such default known to such officers and
the nature and status thereof including the steps being taken by the Servicer to
remedy such default.
(b) Delivery of such reports, information and documents to the
Trustee is for informational purposes only and the Trustee's receipt of such
shall not constitute constructive notice of any information contained therein or
determinable, from information contained therein, including the Servicer's
compliance with any of its covenants hereunder (as to which the Trustee is
entitled to rely exclusively on Officers' Certificates).
Section 3.20 Annual Independent Certified Public Accountants'
Reports.
(a) Not later than 90 days following the end of each fiscal year of
the Servicer commencing in 2000, the Servicer, at its expense, shall cause a
nationally recognized firm of independent certified public accountants to
furnish to the Trustee and the Depositor a report stating that (i) it has
obtained a letter of representation regarding certain matters from the
management of the Servicer which includes an assertion that the Servicer has
complied with certain minimum residential mortgage loan servicing standards,
identified in either the Uniform Single Attestation Program for Mortgage Bankers
established by the Mortgage Bankers Association of America or the Audit Program
for Mortgages serviced by FHLMC, with respect to the servicing of residential
mortgage loans during the most recently completed fiscal year and (ii) on the
basis of an examination conducted by such firm in accordance with standards
established by the American Institute of Certified Public Accountants, such
representation is fairly stated in all material respects, subject to such
exceptions and other qualifications that may be appropriate. Immediately upon
receipt of such report, the Servicer shall furnish a copy of such report to the
Trustee, the Depositor and each Rating Agency. Copies of such statement shall be
provided by the Trustee to any Certificateholder upon request at the Servicer's
expense, provided that such statement is delivered by the Servicer to the
Trustee.
(b) Delivery of such reports, information and documents to the
Trustee is for informational purposes only and the Trustee's receipt of such
shall not constitute constructive notice of any information contained therein or
determinable, from information contained therein, including the Servicer's
compliance with any of its covenants hereunder (as to which the Trustee is
entitled to rely exclusively on Officers' Certificates).
(c) The Trustee shall, on behalf of the Trust Fund, prepare, sign
and file with the Securities and Exchange Commission any and all reports,
statements and information respecting the Trust which the Depositor determines
are required to be filed with the Securities and Exchange Commission pursuant to
Sections 13(a) or 15(d) of the Securities Exchange Act of 1934, as amended, each
such report, statement and information to be filed on or prior to the required
filing date for such report, statement or information. Upon the request of the
Trustee, each of the Seller, the Servicer and the Depositor shall cooperate with
the Trustee in the preparation of any such report and shall provide to the
Trustee in a timely manner all such information or documentation as the Trustee
may reasonably request in connection with the performance of its duties and
obligations under this Section.
Section 3.21 Access to Certain Documentation and Information
Regarding the Mortgage Loans.
The Servicer shall provide to the Trustee, Certificateholders that
are federally insured savings and loan associations, the Office of Thrift
Supervision, the FDIC and the supervisory agents and examiners of each of the
foregoing (which, in the case of supervisory agents and examiners, may be
required by applicable state and federal regulations) access to the
documentation regarding the Mortgage Loans, such access being afforded without
charge but only upon reasonable request and during normal business hours at the
offices of the Servicer designated by it.
Section 3.22 Reserved.
Section 3.23 Obligations of the Servicer in Respect of Compensating
Interest.
Not later than the close of business on each Servicer Remittance
Date, the Servicer shall remit to the Collection Account an amount
("Compensating Interest") equal to the lesser of (A) the aggregate of the
Prepayment Interest Shortfalls on the Actuarial Mortgage Loans for the related
Distribution Date resulting from Principal Prepayments on the Actuarial Mortgage
Loans during the related Prepayment Period and (B) 50% of its aggregate
Servicing Fee received in the related Collection Period. The Servicer shall
apply Compensating Interest to offset any Prepayment Interest Shortfalls on the
Actuarial Mortgage Loans. The Servicer shall not have the right to reimbursement
for any amounts remitted to the Trustee in respect of Compensating Interest.
Such amounts so remitted shall be included in the Available Funds and
distributed therewith on the next Distribution Date. The Servicer shall not be
obligated to pay Compensating Interest with respect to Prepayment Interest
Shortfalls on Simple Interest Mortgage Loans or Relief Act Interest Shortfalls.
Section 3.24 Obligations of the Servicer in Respect of Mortgage
Interest Rates and Monthly Payments.
In the event that a shortfall in any collection on or liability with
respect to any Mortgage Loan results from or is attributable to Monthly Payments
or Principal Balances that were made by the Servicer in a manner not consistent
with the terms of the related Mortgage Note and this Agreement, the Servicer,
upon discovery or receipt of notice thereof, immediately shall deliver to the
Trustee for deposit in the Distribution Account from its own funds the amount of
any such shortfall and shall indemnify and hold harmless the Trust Fund, the
Trustee, the Depositor and any successor servicer in respect of any such
liability. Such indemnities shall survive the termination or discharge of this
Agreement.
Section 3.25 Investment of Funds in the Collection Account and the
Distribution Account.
(a) The Servicer may direct any depository institution maintaining
the Collection Account and the Trustee may direct any depository institution
maintaining the Distribution Account (for purposes of this Section 3.25, an
"Investment Account"), to invest the funds in such Investment Account in one or
more Permitted Investments bearing interest or sold at a discount, and maturing,
unless payable on demand, (i) no later than the Business Day immediately
preceding the date on which such funds are required to be withdrawn from such
account pursuant to this Agreement, if a Person other than the Trustee is the
obligor thereon, and (ii) no later than the date on which such funds are
required to be withdrawn from such account pursuant to this Agreement, if the
Trustee is the obligor thereon. All such Permitted Investments shall be held to
maturity, unless payable on demand. Any investment of funds in an Investment
Account shall be made in the name of the Trustee (in its capacity as such) or in
the name of a nominee of the Trustee. The Trustee shall be entitled to sole
possession (except with respect to investment direction of funds held in the
Collection Account) over each such investment and the income thereon, and any
certificate or other instrument evidencing any such investment shall be
delivered directly to the Trustee or its agent, together with any document of
transfer necessary to transfer title to such investment to the Trustee or its
nominee. In the event amounts on deposit in an Investment Account are at any
time invested in a Permitted Investment payable on demand, the Trustee shall at
the direction of the Servicer:
(x) consistent with any notice required to be given
thereunder, demand that payment thereon be made on the
last day such Permitted Investment may otherwise mature
hereunder in an amount equal to the lesser of (1) all
amounts then payable thereunder and (2) the amount
required to be withdrawn on such date; and
(y) demand payment of all amounts due thereunder promptly
upon determination by a Responsible Officer of the
Trustee that such Permitted Investment would not
constitute a Permitted Investment in respect of funds
thereafter on deposit in the Investment Account.
(b) All income and gain realized from the investment of funds in the
Collection Account shall be for the benefit of the Servicer. The Servicer shall
deposit in the Collection Account the amount of any loss incurred in respect of
any such Permitted Investment made with funds in such account immediately upon
realization of such loss. All income and gain realized from the investment of
funds in the Distribution Account shall be for the benefit of the Trustee. The
Trustee shall deposit in the Distribution Account the amount of any loss
incurred on Permitted Investments in the Distribution Account.
(c) Except as otherwise expressly provided in this Agreement, if any
default occurs in the making of a payment due under any Permitted Investment, or
if a default occurs in any other performance required under any Permitted
Investment, the Trustee may and, subject to Section 8.01 and Section 8.02(a)(v),
upon the request of the Holders of Certificates representing more than 50% of
the Voting Rights allocated to any Class of Certificates, shall take such action
as may be appropriate to enforce such payment or performance, including the
institution and prosecution of appropriate proceedings.
The Trustee shall not in any way be held liable by reason of any
insufficiency in any Account held by the Trustee resulting from any investment
loss on any Permitted Investment included therein (except to the extent that the
Trustee is the obligor and has defaulted thereon).
Section 3.26 Liability of Servicer; Indemnification.
(a) Subject to clause (b) below and Section 6.03, the Servicer
(except the Trustee if it is required to succeed the Servicer hereunder)
indemnifies and holds the Trustee, the Seller, the Depositor and each
Certificateholder harmless against any and all claims, losses, penalties, fines,
forfeitures, reasonable legal fees and related costs, judgments, and any other
costs, fees and expenses that the Trustee, the Depositor and any
Certificateholder may sustain in any way related to the failure of the Servicer
to perform its duties and service the Mortgage Loans in compliance with the
Servicing Standards. The Servicer shall immediately notify the Trustee, the
Depositor and each Certificateholder if a claim is made that may result in such
claims, losses, penalties, fines, forfeitures, legal fees or related costs,
judgments, or any other costs, fees and expenses, and the Servicer shall assume
(with the consent of the Trustee) the defense of any such claim and pay all
expenses in connection therewith, including reasonable counsel fees, and
promptly pay, discharge and satisfy any judgment or decree which may be entered
against the Servicer, the Trustee, the Depositor and/or Certificateholder in
respect of such claim. The provisions of this Section 3.26 shall survive the
termination of this Agreement and the payment of the outstanding Certificates.
(b) None of the Depositor, the Seller, the Servicer, or any of the
directors, officers, employees or agents of the Depositor, the Seller or the
Servicer shall be under any liability to the Trust Fund or 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
Seller or the Servicer or any such Person against any breach of warranties or
representations made herein, or against any specific liability imposed on the
Servicer for a breach of the Servicing Standard, or against any liability which
would otherwise be imposed by reason of its respective willful misfeasance, bad
faith, fraud or negligence in the performance of its duties or by reasons of
negligent disregard of its respective obligations or duties hereunder.
The Depositor, the Servicer, the Seller and any director, officer,
employee or agent of the Depositor or the Servicer, may rely in good faith on
any document of any kind which, prima facie, is properly executed and submitted
by any appropriate Person with respect to any matters arising hereunder. The
Depositor, the Servicer and any director, officer, employee or agent of the
Depositor or the Servicer shall be indemnified and held harmless by the Trust
Fund against any loss, liability or expense incurred in connection with any
legal action relating to this Agreement or the Certificates, other than any
loss, liability or expense incurred in connection with any legal action incurred
by reason of its respective misfeasance, bad faith, fraud or negligence, a
breach of a representation or warranty hereunder or (in the case of the
Servicer) a breach of the Servicing Standard in the performance of its
respective duties or by reason of negligent disregard of its respective
obligations or duties hereunder. Neither the Depositor nor the Servicer shall be
under any obligation to appear in, prosecute or defend any legal action unless
such action is related to its respective duties under this Agreement and in its
opinion does not expose it to any expense or liability; provided, however, that
the Depositor or the Servicer may in its discretion undertake any action related
to its obligations hereunder which it may deem necessary or desirable with
respect to this Agreement and the rights and duties of the parties hereto and
the interests of the Certificateholders hereunder.
Section 3.27 Reports of Foreclosure and Abandonment of Mortgaged
Properties.
On or before the last day of February of each year beginning in
2001, the Servicer shall file the reports of foreclosure and abandonment of any
Mortgaged Property required by Section 6050J of the Code with the Internal
Revenue Service and provide a copy of such filing to the Trustee. The reports
from the Servicer shall be in form and substance sufficient to meet the
reporting requirements imposed by such Section 6050J.
Section 3.28 Seller's Compliance to the Representations and
Warranties of the Transaction Documents.
On a quarterly basis, the Servicer shall deliver to the Trustee, the
Seller and the Depositor, an Officer's Certificate stating that in its
reasonable judgment, none of the losses allocated to the Trust during the
preceding quarter were the result of the Seller's breach of any of its
representations and warranties in the Mortgage Loan Purchase Agreement or this
Agreement.
Section 3.29 Claims Under the PMI Policy.
The Servicer shall, on behalf of the Trustee, prepare and file in a
timely basis with the PMI Insurer, with a copy to the Trustee, all claims which
may be made under the PMI Policy with respect to PMI Mortgage Loans. Consistent
with its rights and obligations hereunder, the Servicer shall take all actions
required under the PMI Policy as a condition to the payment of any such claim.
Any amount received from the PMI Insurer with respect to any such PMI Mortgage
Loan shall be deposited by the Servicer, not later than two Business Days
following receipt thereof, into the Distribution Account for distribution on the
related Distribution Date as part of Liquidation Proceeds for the related Loan
Group.
The Servicer shall pay on each Distribution Date the PMI Fee due
under the PMI Policy to the PMI Insurer from funds on deposit in the Collection
Account.
ARTICLE IV
FLOW OF FUNDS
Section 4.01 Interest Distributions.
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On each Distribution Date, the Trustee shall withdraw from the
Distribution Account the Interest Remittance Amount and apply it in the
following order of priority (based upon the Mortgage Loan information provided
to it in the Remittance Report, upon which the Trustee may conclusively rely),
and the calculations required to be made by the Trustee, to the extent
available:
(i) to the Trustee, the Trustee Fee for such Distribution
Date;
(ii) concurrently, to the Class A-1A, Class A-1F and Class
A-2F Certificates, pro rata, the applicable Accrued
Certificate Interest for such Distribution Date;
(iii) concurrently, to the Class A-1A, Class A-1F and Class
A-2F Certificates, pro rata, the applicable Interest
Carry Forward Amount for the Class A-1A, Class A-1F and
Class A-2F Certificates, respectively;
(iv) to the Class M-1 Certificates, the Accrued Certificate
Interest thereon for such Distribution Date;
(v) to the Class M-2 Certificates, the Accrued Certificate
Interest thereon for such Distribution Date;
(vi) to the Class B Certificates, the Accrued Certificate
Interest thereon for such Distribution Date; and
(vii) the amount, if any, of the Interest Remittance Amount
remaining after application with respect to the
priorities set forth above will be applied as described
under Section 4.02(b) hereof.
Section 4.02 Distributions of Principal and Monthly Excess Cashflow
Amounts.
(a) On each Distribution Date, the Trustee shall make the following
distributions in the following order of priority (based upon the Mortgage Loan
information provided to it in the Remittance Report), and the calculations
required to be made by the Trustee, to the extent of the Principal Distribution
Amount:
(i) before the Stepdown Date or with respect to which a
Trigger Event is in effect,
(A) concurrently, as follows:
(1) sequentially to the Holders of the Class A-1A and
Class A-1F Certificates, in that order, the Group 1 Principal
Percentage of the Principal Distribution Amount for such
Distribution Date, until the Certificate Principal Balance of
each such Class has been reduced to zero and then to the Class
A-2F Certificates, until the Certificate Principal Balance of
such Class has been reduced to zero; and
(2) to the Holders of the Class A-2F Certificates, the
Group 2 Principal Percentage of the Principal Distribution
Amount for such Distribution Date, until the Certificate
Principal Balance of such Class has been reduced to zero and
then sequentially to the Class A-1A and Class A-1F
Certificates, in that order, until the Certificate Principal
Balance of each such Class has been reduced to zero;
(B) to the Holders of the Class M-1 Certificates, 100% of the
remaining Principal Distribution Amount for such Distribution Date,
until the Certificate Principal Balance of the Class M-1
Certificates has been reduced to zero;
(C) to the Holders of the Class M-2 Certificates, 100% of the
remaining Principal Distribution Amount, until the Certificate
Principal Balance of the Class M-2 Certificates has been reduced to
zero;
(D) to the Holders of the Class B Certificates, 100% of the
remaining Principal Distribution Amount, until the Certificate
Principal Balance of the Class B Certificates has been reduced to
zero; and
(E) any amount of the Principal Distribution Amount remaining
after making all of the distributions in Clauses (A), (B), (C) and
(D) shall be applied as set forth in Section 4.02(b).
(ii) on or after the Stepdown Date and as long as a Trigger
Event is not in effect:
(A) the lesser of (x) the Principal Distribution Amount and
(y) the Class A Principal Distribution Amount, concurrently as
follows:
(1) the Group 1 Principal Percentage of the lesser of (x) the
Principal Distribution Amount and (y) Class A Principal
Distribution Amount will be distributed sequentially, to the
Class A-1A and Class A-1F Certificates, in that order, until
the Certificate Principal Balance of each such Class has been
reduced to zero and then to the Class A-2F Certificates, until
the Certificate Principal Balance of such Class has been
reduced to zero; and
(2) the Group 2 Principal Percentage of the lesser of (x) the
Principal Distribution Amount and (y) Class A Principal
Distribution Amount will be distributed to the Class A-2F
Certificates, until the Certificate Principal Balance of such
Class has been reduced to zero and then sequentially to the
Class A-1A and Class A-1F Certificates, in that order, until
the Certificate Principal Balance of each such Class has been
reduced to zero;
(B) the lesser of (x) the excess of (i) the Principal
Distribution Amount over (ii) the amount distributed to the Class A
Certificates in clause (A) above and (y) the Class M-1 Principal
Distribution Amount will be distributed to the Class M-1
Certificates, until the Certificate Principal Balance thereof has
been reduced to zero;
(C) the lesser of (x) the excess of (i) the Principal
Distribution Amount over (ii) the sum of the amount distributed to
the Class A Certificates in clause (A) above and the amount
distributed to the Class M-1 Certificates in clause (B) above and
(y) the Class M-2 Principal Distribution Amount will be distributed
to the Class M-2 Certificates, until the Certificate Principal
Balance thereof has been reduced to zero;
(D) the lesser of (x) the excess of (i) the Principal
Distribution Amount over (ii) the sum of the amount distributed to
the Class A Certificates pursuant to clause (A) above, the amount
distributed to the Class M-1 Certificates pursuant to clause (B)
above and the amount distributed to the Class M-2 Certificates
pursuant to clause (C) above and (y) the Class B Principal
Distribution Amount will be distributed to the Class B Certificates,
until the Certificate Principal Balance thereof has been reduced to
zero; and
(E) any amount of the Principal Distribution Amount remaining
after making all of the distributions in clauses (A), (B), (C) and
(D) above shall be applied as set forth in Section 4.02(b).
(b) On each Distribution Date, any Monthly Excess Cashflow Amount
shall be distributed, to the extent available, in the following order of
priority on such Distribution Date:
(i) to pay any remaining unpaid Accrued Certificate Interest for
such Distribution Date, pro rata, among the Class A-1A, Class A-1F, and
Class A-2F Certificates;
(ii) to pay the remaining Interest Carry Forward Amounts for the
Classes of Class A Certificates, if any, pro rata, among the Class A-1A,
the Class A-1F and the Class A-2F Certificates;
(iii) to pay the Extra Principal Distribution Amount for such
Distribution Date;
(iv) to pay any remaining unpaid Accrued Certificate Interest for
such Distribution Date for the Class M-1 Certificates;
(v) to pay the remaining Class M-1 Interest Carry Forward Amount,
if any;
(vi) to pay the Class M-1 Realized Loss Amortization Amount for
such Distribution Date;
(vii) to pay any remaining unpaid Accrued Certificate Interest
for such Distribution Date for the Class M-2 Certificates;
(viii) to pay the remaining Class M-2 Interest Carry Forward
Amount, if any;
(ix) to pay the Class M-2 Realized Loss Amortization Amount for
such Distribution Date;
(x) to pay any remaining unpaid Accrued Certificate Interest for
such Distribution Date for the Class B Certificates;
(xi) to pay the remaining Class B Interest Carry Forward Amount,
if any;
(xii) to pay the Class B Realized Loss Amortization Amount for
such Distribution Date;
(xiii) to pay the aggregate amount of any LIBOR Carryover Amount
to the Class A-1A Certificates, if any;
(xiv) to pay any unpaid Special Servicing Fees for such
Distribution Date or which remain unpaid from any previous Distribution
Date;
(xv) to pay the Class BB Certificates, (A) the Accrued
Certificate Interest for the Class BB Certificates and (B) any remaining
Monthly Excess Cashflow Amount to reduce the Class BB Notional Amount,
until the Class BB Notional Amount has been reduced to zero;
(xvi) to fund the Class BB Reserve Fund, up to the Required
Reserve Fund Balance; and
(xvii) to the Class X Certificates, the Class X Distributable
Amount for such Distribution Date.
On each Distribution Date, there shall be distributed to the Holders
of the Class R Certificates in respect of the Class R-1 Interest, any remaining
amount in the Distribution Account on such date after the application pursuant
to Sections 4.01, 4.02(a) and 4.02(b)(i)-(xvii).
(c) On each Distribution Date, all prepayment premiums and penalties
(including amounts deposited by the Seller in lieu thereof pursuant to Section
3.01) shall be allocated to the Class BB Certificates for so long as the
Notional Amount of the Class BB Certificates is greater than zero pursuant to
Section 4.02(b)(xv) above), and to the Class X Certificates after the Class BB
Notional Amount has been reduced to zero.
(d) Any amounts distributed to the Class A-1A Certificates in
respect of LIBOR Carryover Amounts pursuant to Section 4.02(b)(xiii) shall first
be deemed paid by REMIC 4 to the Class X/BB Interest as a distribution of
Monthly Excess Interest Amount, and subsequently paid to the Class A-1A
Certificates outside of the REMICs as a payment on a notional principal contract
in the nature of a cap contract.
(e) Any amounts distributed to the Class BB Certificates pursuant to
Section 4.02(b)(xv), to the Class BB Reserve Fund pursuant to Section
4.02(b)(xvi) and to the Class X Certificates pursuant to Section 4.02(b)(xvii)
shall be considered distributed to the Class X/BB Interest in respect of the
REMIC 4 Components and then to the Class BB and Class X Certificates pursuant to
Section 9.01(m).
Section 4.03 Allocation of Losses.
Realized Losses shall be allocated first against the Remaining
Initial Overcollateralization Amount and second to the Subsequent
Overcollateralization Amount, until the Overcollateralization Amount has been
reduced to zero. If, after giving effect to the distribution of the Principal
Distribution Amount on any Distribution Date the aggregate Certificate Principal
Balance of the Offered Certificates exceeds the Pool Balance as of the end of
the related Collection Period, such excess will be allocated against the Class
B, Class M-2, Class M-1 and the Senior Certificates, in that order and until the
respective Certificate Principal Balances thereof are reduced to zero. Any
allocation to the Senior Certificates shall be further allocated among the Class
A-1A, Class A-1F and Class A-2F Certificates, pro rata, on the basis of their
respective Certificate Principal Balances.
Section 4.04 Method of Distribution.
The Trustee shall make distributions in respect of a Distribution
Date to each Certificateholder of record on the related Record Date (other than
as provided in Section 10.01 respecting the final distribution), in the case of
Certificateholders of the Certificates, by wire transfer in immediately
available funds to the account of the Person entitled thereto if such Person
shall have so notified the Trustee in writing at least five Business Days prior
to the Record Date immediately prior to such Distribution Date and is the
registered owner of such Certificates the aggregate initial Certificate
Principal Balance of which is in excess of $5,000,000, or by check mailed by
first class mail to the address of the Person entitled thereto, as such name and
address shall appear on the Certificate Register, provided that the Trustee may
deduct a reasonable wire transfer fee from any payment made by wire transfer.
Distributions among Certificateholders shall be made in proportion to the
Percentage Interests evidenced by the Certificates held by such
Certificateholders.
Section 4.05 Distributions on Book-Entry Certificates.
Each distribution with respect to a Book-Entry Certificate shall be
paid to the Depository, which shall credit the amount of such distribution to
the accounts of its Depository Participants in accordance with its normal
procedures. Each Depository Participant shall be responsible for disbursing such
distribution to the Certificate Owners that it represents and to each indirect
participating brokerage firm (a "brokerage firm" or "indirect participating
firm") for which it acts as agent. Each brokerage firm shall be responsible for
disbursing funds to the Certificate Owners that it represents. All such credits
and disbursements with respect to a Book-Entry Certificate are to be made by the
Depository and the Depository Participants in accordance with the provisions of
the Certificates. None of the Trustee, the Depositor, the Servicer or the Seller
shall have any responsibility therefor except as otherwise provided by
applicable law.
Section 4.06 Statements.
(a) On each Distribution Date, based, as applicable, on the Mortgage
Loan information contained in the Remittance Report, the Trustee shall prepare
and forward by mail to each Holder of the Regular Certificates, the Servicer and
the Rating Agencies, a statement as to the distributions made on such
Distribution Date:
(i) the amount of the distribution made on such Distribution Date
to the Holders of each Class of Certificates allocable to principal or
reduction of Notional Amount, separately identified;
(ii) the amount of the distribution made on such Distribution
Date to the Holders of each Class of Certificates allocable to interest or
Class X Distributable Amount, separately identified;
(iii) the Overcollateralization Amount, the Overcollateralization
Release Amount, the Overcollateralization Deficiency and the
Overcollateralization Target Amount as of such Distribution Date and the
Monthly Excess Interest Amount and Monthly Excess Cashflow Amount for such
Distribution Date;
(iv) the aggregate amount of servicing compensation received by
the Servicer during the related Collection Period;
(v) the aggregate amount of Advances for the related Collection
Period;
(vi) the Pool Balance and the Loan Group Balance for each Loan
Group at the close of business at the end of the related Collection
Period;
(vii) separately stated for each Loan Group, the number, weighted
average remaining term to maturity and weighted average Mortgage Interest
Rate of the Mortgage Loans as of the related Due Date;
(viii) separately stated for each Loan Group, the number and
aggregate unpaid principal balance of Mortgage Loans (a) 30 to 59 days
past due on a contractual basis, (b) 60 to 89 days past due on a
contractual basis, (c) 90 or more days past due on a contractual basis,
(d) as to which foreclosure proceedings have been commenced and (e) in
bankruptcy as of the close of business on the last day of the calendar
month preceding such Distribution Date;
(ix) separately stated for each Loan Group, with respect to any
Mortgage Loan that became an REO Property during the preceding calendar
month, the loan number of such Mortgage Loan, the unpaid principal balance
and the Principal Balance of such Mortgage Loan as of the date it became
an REO Property;
(x) separately stated for each Loan Group, the book value of any
REO Property as of the close of business on the last Business Day of the
calendar month preceding the Distribution Date, and, cumulatively, the
total number and cumulative principal balance of all REO Properties as of
the close of business of the last day of the preceding Collection Period;
(xi) separately stated for each Loan Group, the aggregate amount
of Principal Prepayments made during the related Prepayment Period;
(xii) the aggregate amount of prepayment penalties collected or
deposits by the Seller in lieu thereof pursuant to Section 3.01 during the
related Collection Period and the amounts thereof allocable to the Class
BB Certificates and the Class X Certificates;
(xiii) separately stated for each Loan Group, the aggregate
amount of Realized Losses incurred during the related Collection Period
and the cumulative amount of Realized Losses;
(xiv) the Certificate Principal Balance, or Notional Amount, as
applicable, of each Class of Certificates, after giving effect to the
distributions, and allocations of Realized Losses or Applied Realized Loss
Amounts, as applicable, made on such Distribution Date, separately
identifying any reduction thereof due to allocations of Realized Losses or
Applied Realized Loss Amounts;
(xv) the Accrued Certificate Interest in respect of each Class of
Offered Certificates for such Distribution Date and the respective
portions thereof, if any, remaining unpaid following the distributions
made in respect of such Certificates on such Distribution Date;
(xvi) the aggregate amount of any Prepayment Interest Shortfalls
for such Distribution Date, to the extent not covered by payments by the
Servicer pursuant to Section 3.23;
(xvii) [Reserved];
(xviii) [Reserved];
(xix) the amount of the Trustee Fee paid;
(xx) the LIBOR Carryover Amount for the Class A-1A Certificates
after giving effect to distributions thereof on such Distribution Date;
(xxi) any Overcollateralization Deficiency after giving effect to
the distribution of principal on such Distribution Date;
(xxii) whether a Trigger Event has occurred and is continuing,
and the cumulative Realized Losses, as a percentage of the original Pool
Balance;
(xxiii) the Available Funds;
(xxiv) the rate at which interest accrues for each Class of
Certificates for such Distribution Date;
(xxv) the Liquidation Report for such Distribution Date;
(xxvi) the aggregate Principal Balance of Mortgage Loans
purchased by the Servicer or Seller during the related Collection Period
and indicating the Section of this Agreement requiring or allowing the
purchase of each such Mortgage Loan; and
(xxvii) the aggregate Principal Balance of the Mortgage Loans
repurchased by the Seller during the related Collection Period in
connection with Section 3.16.
The Trustee shall forward such report concurrently with each
distribution to the Certificateholders, the Rating Agencies, Bloomberg (at 499
Park Avenue, New York, New York 10022, Attention: Mike Geller) and Intex
Solutions (at 35 Highland Circle, Needham, Massachusetts 02144, Attention:
Harold Brennman) on the related Distribution Date. The Trustee will also make
such reports available each month via the Trustee's website. The Trustee's
website can be accessed at www.chase.com/sfa or at such other site as the
Trustee may designate from time to time. The Trustee may fully rely upon and
shall have no liability with respect to information with respect to the Mortgage
Loans provided by the Servicer.
In the case of information furnished pursuant to subclauses (i)
through (iii) above, the amounts shall be expressed in a separate section of the
report as a dollar amount for each Class for each $1,000 original dollar amount
as of the Cut-off Date.
(b) Within a reasonable period of time after the end of each
calendar year, the Trustee shall furnish to each Person who at any time during
the calendar year was a Certificateholder of a Regular Certificate, if requested
in writing by such Person, such information as is reasonably necessary to
provide to such Person a statement containing the information set forth in
subclauses (i) through (iii) above, aggregated for such calendar year or
applicable portion thereof during which such Person was a Certificateholder.
Such obligation of the Trustee shall be deemed to have been satisfied to the
extent that substantially comparable information shall be prepared and furnished
by the Trustee to Certificateholders pursuant to any requirements of the Code as
are in force from time to time.
(c) On each Distribution Date, the Trustee shall forward to the
Class R Certificateholders a copy of the reports forwarded to the Regular
Certificateholders in respect of such Distribution Date with such other
information as the Trustee deems necessary or appropriate.
(d) Within a reasonable period of time after the end of each
calendar year, the Trustee shall deliver to each Person who at any time during
the calendar year was a Class R Certificateholder, if requested in writing by
such Person, such information as is reasonably necessary to provide to such
Person a statement containing the information provided pursuant to the previous
paragraph aggregated for such calendar year or applicable portion thereof during
which such Person was a Class R Certificateholder. Such obligation of the
Trustee shall be deemed to have been satisfied to the extent that substantially
comparable information shall be prepared and furnished to Certificateholders by
the Trustee pursuant to any requirements of the Code as from time to time in
force.
Section 4.07 Remittance Reports; Advances.
(a) On the second Business Day following each Determination Date but
in no event less than four Business Days prior to the related Distribution Date,
the Servicer shall deliver to the Trustee by telecopy (or by such other means as
the Servicer and the Trustee may agree from time to time) a Remittance Report
with respect to the related Distribution Date. On the same date, the Servicer
shall forward to the Trustee by overnight mail a computer readable magnetic tape
or diskette or in such other medium as may be agreed between the Servicer and
the Trustee containing the information set forth in such Remittance Report with
respect to the related Distribution Date. Not later than the close of business
New York time on the Servicer Remittance Date, the Servicer shall deliver or
cause to be delivered to the Trustee in addition to the information provided on
the Remittance Report, such other information reasonably available to it with
respect to the Mortgage Loans as the Trustee may reasonably request or order in
order for the Trustee to perform the calculations necessary to make the
distributions contemplated by Section 4.01, 4.02 and 4.03 and to prepare the
statements to Certificateholders contemplated by Section 4.06. The Trustee shall
not be responsible to recompute, recalculate or verify any information provided
to it by the Servicer.
(b) The amount of Advances to be made by the Servicer for any
Distribution Date shall equal, subject to Section 4.07(d), the aggregate amount
of Monthly Payments (net of the related Servicing Fee), due during the related
Collection Period in respect of the Actuarial Mortgage Loans, which Monthly
Payments were delinquent on a contractual basis as of the close of business on
the related Determination Date. For purposes of the preceding sentence, the
Monthly Payment on each Balloon Mortgage Loan with a delinquent Balloon Payment
is equal to the assumed monthly payment that would have been due on the related
Due Date based on the original principal amortization schedule for the such
Balloon Mortgage Loan. The Servicer shall not be obligated to make any Advance
with respect to Simple Interest Mortgage Loans.
On or before the close of business New York time on the Servicer
Remittance Date, the Servicer shall remit in immediately available funds to the
Trustee for deposit in the Distribution Account an amount equal to the aggregate
amount of Advances, if any, to be made in respect of the Mortgage Loans for the
related Distribution Date either (i) from its own funds or (ii) from the
Collection Account, to the extent of funds held therein for future distribution
(in which case it will cause to be made an appropriate entry in the records of
the Collection Account that amounts held for future distribution have been, as
permitted by this Section 4.07, used by the Servicer in discharge of any such
Advance) or (iii) in the form of any combination of (i) and (ii) aggregating the
total amount of Advances to be made by the Servicer with respect to the Mortgage
Loans. Any amounts held for future distribution and so used shall be
appropriately reflected in the Servicer's records and replaced by the Servicer
by deposit in the Collection Account on or before any future Servicer Remittance
Date to the extent that the Available Funds for the related Distribution Date
(determined without regard to Advances to be made on the Servicer Remittance
Date) shall be less than the total amount that would be distributed to the
Classes of Certificateholders pursuant to Section 4.01 and 4.02 on such
Distribution Date if such amounts held for future distributions had not been so
used to make Advances. The Trustee will provide notice to the Servicer by
telecopy by the close of business on any Servicer Remittance Date in the event
that the amount remitted by the Servicer to the Trustee on such date is less
than the Advances required to be made by the Servicer for the related
Distribution Date, as set forth in the related Remittance Report.
(c) The obligation of the Servicer to make such Advances is
mandatory, notwithstanding any other provision of this Agreement but subject to
(d) below, and, with respect to any Mortgage Loan, shall continue until the
earlier of such time as the Trust acquires title to the related Mortgaged
Property or such Mortgage Loan is paid in full by the Mortgagor or disposed of
by the Trust, or until the recovery of all Liquidation Proceeds thereon.
(d) Notwithstanding anything herein to the contrary, no Advance
shall be required to be made hereunder by the Servicer if such Advance would, if
made, constitute a Nonrecoverable Advance. The determination by the Servicer
that it has made a Nonrecoverable Advance or that any proposed Advance, if made,
would constitute a Nonrecoverable Advance, shall be evidenced by an Officers'
Certificate of the Servicer delivered to the Depositor and the Trustee.
Section 4.08 Class BB Reserve Fund.
(a) On the Closing Date, the Trustee shall establish and maintain in its
name, in trust for the benefit of the Holders of the Class BB Certificates, the
Class BB Reserve Fund. The Class BB Reserve Fund shall be an Eligible Account,
and funds on deposit therein shall be held separate and apart from, and shall
not be commingled with, any other moneys, including, without limitation, other
moneys of the Trustee held pursuant to this Agreement. On each Distribution
Date, commencing on the Distribution Date occurring in December 1999, the
balance in the Class BB Reserve Fund shall equal the Required Reserve Fund
Balance. The Class BB Reserve Fund shall be funded with the initial payment to
the Class BB Certificates on the Distribution Date in December 1999. If the
Class BB Reserve Fund balance on any Distribution Date, after taking into
account any amounts deposited to the Class BB Reserve Fund pursuant to Section
4.02(b) on such Distribution Date, is less than the Required Reserve Fund
Balance, then the Seller shall be required to make a deposit into the Class BB
Reserve Fund equal to the Required Reserve Fund Deposit less amounts on deposit
thereon. The Trustee shall distribute the Class BB Reserve Fund only to the
holders of the Class BB Certificates and only on a Distribution Date to the
extent that there is insufficient cash in the Distribution Account to make the
distribution pursuant to Section 4.02(b)(xv)(A) for such Distribution Date.
(b) Funds in the Class BB Reserve Fund may be invested in Permitted
Investments by the Trustee at the direction of the Holder of the Class X
Certificates with the greatest Percentage Interest. Any earnings on such amounts
shall be distributed to the Holders of the Class X Certificates and any losses
shall be chargeable first to amounts held in the Class BB Reserve Fund and
second to Holders of the Class X Certificates. The Class BB Reserve Fund is not
an asset of any of the REMICs, but rather is beneficially owned by the
beneficial owner of the Class X and Class BB Certificates (when the Class X and
Class BB Certificates are beneficially owned by one Person) or by the
partnership comprised of the Class X and Class BB Certificates (when the Class X
and Class BB Certificates are beneficially owned by two or more Persons). The
Holders of the Class X Certificates shall direct the Trustee, in writing, as to
the investment of amounts on deposit therein. Upon termination of the Trust
Fund, any amounts remaining in the Class BB Reserve Fund shall be distributed to
the Holders of the Class X Certificates.
Section 4.09 REMIC Distributions
(a) REMIC 4. On each Distribution Date, the timing and amounts of
principal and interest distributions on each Class of REMIC 4 Regular Interests
shall be identical to the timing and amounts of principal and interest
distributions on the corresponding Classes of Certificates (other than the Class
R, Class X and Class BB Certificates), except as follows: (i) the Pass-Through
Rate of the Class T4-A1A Interest shall not exceed the Maximum Rate as set forth
in the first sentence of the definition thereof, and any amount paid in respect
of the Class A-1A Certificates as a LIBOR Carryover Amount, whether with respect
to the Distribution Date on which such amount is paid or a prior Distribution
Date, shall be treated as a distribution by REMIC 4 to the Class X/BB Interest
as a Monthly Excess Interest Amount, then as paid by the Class X/BB Interest to
the Class A-1A Certificates outside of the REMICs; (ii) the Class T4-4, Class
T4-5, Class T4-6 and Class T4-7 Interests shall be entitled to all distributions
on the Class T3-4, Class T3-5, Class T3-6 and Class T3-7 Interests,
respectively; and (iii) the Class T4-11, Class T4-12, Class T4-13, Class T4-14,
Class T5-15 and Class T4-16 Interests shall be entitled to a specified portion
of interest payments consisting of the excess of interest distributable on each
of the Class T3A-1A, Class T3A-1F, Class T3-A-2F, Class T3-M1, Class T3-M2 and
Class T3-B Interests over interest distributable on the Class T4A-1A Interest
and the Class A-1F, Class A-2F, Class M-1, Class M-2 and Class B Certificates,
respectively. The Class X/BB Interest shall be deemed to receive the aggregate
of the amounts distributable in respect of the REMIC 4 Components,
notwithstanding that a portion of such amount is applied to pay the LIBOR
Carryover Amount. Any portion of the Available Funds remaining in REMIC 4 on a
Distribution Date shall be distributed to the Class R Certificates in respect of
the Class R-4 Interest.
(b) REMIC 3. On each Distribution Date, the timing and amounts of
principal and interest distributions and allocations of Applied Realized Loss
Amounts and Realized Loss Amortization Amounts on the Classes of REMIC 3 Regular
Interests identified as Corresponding Classes shall be identical to the timing,
amounts and allocations in respect of Corresponding Classes of REMIC 4 Regular
Interests pursuant to Section 4.09(a). The Class T3-5, Class T3-6 and Class T3-7
Interests shall be entitled to all distributions on the Class T2-5, Class T2-6
and Class T2-7 Interests, respectively. Interest shortfalls will reduce interest
payable, first on the Class T3-4 Interest, second, on the Class T3-5, Class T3-6
and Class T3-7 Interests, pro rata, third, on the Class T3-B, Class T3-M2 and
Class T3-M1 Interests, in that order, and fourth, on the Class T3-A1A, Class
T3-A1F and Class T3-A2F Interests, pro rata; provided, that the portion of the
interest payable on the Class T3-B, Class T3-M2, Class T3-M1, Class T3-A1A,
Class T3-A1F and Class T3-A2F Interests attributable to the Class T4-11, Class
T4-12, Class T4-13, Class T4-14, Class T4-15, Class T4-16 Interests shall bear
interest shortfalls pro rata and prior to the allocation of any remaining
shortfalls to such Interests. Amounts of principal and interest distributed in
respect of, and Realized Losses allocated to, the Class T3-4 Interest shall
equal the allocations made to the Class T2-4 Interest, reduced by any allocation
of interest shortfalls to the Class T3-4 Interest pursuant to the preceding
sentence. Amounts in the Distribution Account deemed distributed in respect of
the REMIC 3 Regular Interests shall be treated as held by REMIC 4 for
distribution in accordance with Sections 4.01 and 4.02. Any portion of Available
Funds remaining in REMIC 3 on a Distribution Date shall be distributed to the
Class R Certificates in respect of the Class R-3 Interest.
(c) REMIC 2. On each Distribution Date, the timing and amounts of
principal distributions and allocations of Realized Losses on each Class of
REMIC 2 Regular Interests shall be identical to the timing, amounts and
allocations in respect of the alphabetically and numerically corresponding
Classes of REMIC 1 Regular Interests pursuant to Section 4.09(d). Interest will
accrue on each of the Class T2-1, Class T2-2 and Class T2-3 Interests at the
REMIC 2 Pass-Through Rate. Interest will accrue on each of the Class T2-5, Class
T2-6 and Class T2-7 Interests at the excess, if any, of the Weighted Average Net
Mortgage Rate over the REMIC 2 Pass-Through Rate. Interest will accrue on the
Class T2-4 Interest at the Weighted Average Net Mortgage Rate. Any shortfalls of
interest will be allocated first, to the Class T2-4 Interest and then, pro rata,
to the Class T2-1, Class T2-2, Class T2-3, Class T2-5, Class T2-6, and Class
T2-7 Interests. Amounts in the Distribution Account deemed distributed in
respect of the REMIC 2 Regular Interests shall be treated as held by REMIC 3 for
distribution in accordance with Section 4.09(b). Any portion of Available Funds
remaining in REMIC 2 on a Distribution Date shall be distributed to the Class R
Certificates in respect of the Class R-2 Interest.
(d) REMIC 1. On each Distribution Date, the REMIC 1 Regular
Interests shall receive distributions of interest and principal equal in the
aggregate to amounts distributable pursuant to Sections 4.01 and 4.02 from
amounts on deposit in the Distribution Account. Such amounts with respect to
interest shall accrue at the Weighted Average Net Mortgage Rate on each REMIC 1
Regular Interest, reduced by any shortfalls of interest. Amounts in reduction of
principal balance of the REMIC 1 Regular Interests shall be allocated to the
Class T1-1, Class T1-2 and Class T1-3 Interests in the aggregate in an amount
equal to the Principal Remittance Amount less the excess, if any, of the
Overcollateralization Release Amount over the Subsequent Overcollateralization
Amount. Such aggregate amount shall be allocated so that the principal balance
of the Class T1-1, Class T1-2 and Class T1-3 Interests equal the amounts
specified in the definitions thereof in Article I. The portion of the Principal
Remittance Amount equal to the excess, if any, of the Overcollateralization
Release Amount over the Subsequent Overcollateralization Amount shall be
allocated to reduce the principal balance of the Class T1-4 Interest, until it
is reduced to zero. Realized Losses shall be allocated first to the Class T1-4
Interest, until it is reduced to zero, and then pro rata to the Class T1-1,
Class T1-2 and Class T1-3 Interests. Such amounts with respect to principal and
any Realized Losses with respect to principal shall reduce the principal
balances of the REMIC 1 Regular Interests so that, in the aggregate, such
balances correspond to this aggregate Principal Balance of the Mortgage Loans as
of the last day of the related Due Period. Amounts in the Distribution Account
deemed distributed in respect of the REMIC 1 Regular Interests shall be treated
as held by REMIC 2 for distribution in accordance with Section 4.09(c). Any
amounts remaining in REMIC 1 on a Distribution Date shall be distributed to the
Class R Certificates in respect of the Class R-1 Interest.
(e) All prepayment premiums and penalties (including amounts
deposited by the Seller in lieu thereof pursuant to Section 3.01) shall be
distributed from REMIC 1 to REMIC 2 in respect of the Class T1-4 Interest, from
REMIC 2 to REMIC 3 in respect of the Class T2-4 Interest, from REMIC 3 to REMIC
4 in respect of the Class T3-4 Interest, and from REMIC 4 to the Class X/BB
Interest in respect of the Class T4-4 Interest.
ARTICLE V
THE CERTIFICATES
Section 5.01 The Certificates.
Each of the Class A-1A, Class A-1F, Class A-2F, Class M-1, Class
M-2, Class B, Class BB, Class X, and Class R Certificates shall be substantially
in the forms annexed hereto as exhibits, and shall, on original issue, be
executed, authenticated and delivered by the Trustee to or upon the receipt of a
Written Order to Authenticate from the Depositor concurrently with the sale and
assignment to the Trustee of the Trust Fund. Each Class of the Offered
Certificates shall be initially evidenced by one or more Certificates
representing a Percentage Interest with a minimum dollar denomination of $25,000
and integral dollar multiples of $1,000 in excess thereof. The Class BB, Class X
and Class R Certificates are issuable only in minimum Percentage Interests of
25%.
The Certificates shall be executed on behalf of the Trust by manual
or facsimile signature on behalf of the Trustee by a Responsible 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 Trust, notwithstanding that such individuals or any
of them have ceased to be so authorized prior to the authentication 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 such Certificate shall have been
manually authenticated by the Trustee substantially in the form provided for
herein, and such authentication upon any Certificate shall be conclusive
evidence, and the only evidence, that such Certificate has been duly
authenticated and delivered hereunder. All Certificates shall be dated the date
of their authentication. Subject to Section 5.02(c), the Offered Certificates
shall be Book-Entry Certificates. The Class BB, Class X and Class R Certificates
shall not be Book-Entry Certificates but shall be issued in fully registered
certificate form.
Section 5.02 Registration of Transfer and Exchange of Certificates.
(a) The Certificate Registrar shall cause to be kept at the
Corporate Trust Office a Certificate Register in which, subject to such
reasonable regulations as it may prescribe, the Certificate Registrar shall
provide for the registration of Certificates and of transfers and exchanges of
Certificates as herein provided. The Trustee shall initially serve as
Certificate Registrar for the purpose of registering Certificates and transfers
and exchanges of Certificates as herein provided.
Upon surrender for registration of transfer of any Certificate at
any office or agency of the Certificate Registrar maintained for such purpose
pursuant to the foregoing paragraph and, in the case of a Class R Certificate,
upon satisfaction of the conditions set forth below, the Trustee on behalf of
the Trust shall execute, authenticate and deliver, in the name of the designated
transferee or transferees, one or more new Certificates of the same aggregate
Percentage Interest.
At the option of the Certificateholders, Certificates may be
exchanged for other Certificates in authorized denominations and the same
aggregate Percentage Interests, upon surrender of the Certificates to be
exchanged at any such office or agency. Whenever any Certificates are so
surrendered for exchange, the Trustee shall execute on behalf of the Trust and
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 (if so required by the Trustee or the
Certificate Registrar) be duly endorsed by, or be accompanied by a written
instrument of transfer satisfactory to the Trustee and the Certificate Registrar
duly executed by, the Holder thereof or his attorney duly authorized in writing.
(b) Upon original issuance, the Book-Entry Certificates shall be
issued in the form of one or more typewritten certificates, to be delivered to
the Depository, the initial Depository, by, or on behalf of, the Depositor; or
to, and deposited with the Certificate Custodian, on behalf of the Depository,
if directed to do so pursuant to instructions from the Depository. Except as
provided in paragraph (c) 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 such 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 Certificates; (iii) ownership and transfers of registration of
such 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 for all purposes deal with the Depository as representative of
the Certificate Owners of the Certificates for purposes of exercising the rights
of Holders under this Agreement, and requests and directions for and votes of
such representative shall not be deemed to be inconsistent if they are made with
respect to different Certificate Owners; (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; and (vii) the direct participants of the Depository shall have no rights
under this Agreement under or with respect to any of the Certificates held on
their behalf by the Depository, and the Depository may be treated by the Trustee
and its agents, employees, officers and directors as the absolute owner of the
Certificates for all purposes whatsoever.
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 Owners. Each
Depository Participant shall only transfer Book-Entry Certificates of
Certificate Owners that it represents or of brokerage firms for which it acts as
agent in accordance with the Depository's normal procedures. The parties hereto
are hereby authorized to execute a Letter of Representations with the Depository
or take such other action as may be necessary or desirable to register a
Book-Entry Certificate to the Depository. In the event of any conflict between
the terms of any such Letter of Representation and this Agreement, the terms of
this Agreement shall control.
(c) If (i)(x) the Depository or the Depositor advises the Trustee in
writing that the Depository is no longer willing or able to discharge properly
its responsibilities as Depository and (y) the Trustee or the Depositor is
unable to locate a qualified successor, (ii) the Depositor, at its sole option,
with the consent of the Trustee, elects to terminate the book-entry system
through the Depository or (iii) after the occurrence of a Servicer Event of
Termination, the Certificate Owners of each Class of Book-Entry Certificates
representing Percentage Interests of such Classes aggregating not less than 51%
advises the Trustee and Depository through the Financial Intermediaries and the
Depository Participants in writing that the continuation of a book-entry system
through the Depository to the exclusion of definitive, fully registered
certificates (the "Definitive Certificates") to Certificate Owners is no longer
in the best interests of the Certificate Owners. Upon surrender to the
Certificate Registrar of the Book-Entry Certificates by the Depository,
accompanied by registration instructions from the Depository for registration,
the Trustee shall, at the Depositor's expense, in the case of (ii) above, or the
Seller's expense, in the case of (i) and (iii) above, execute on behalf of the
Trust and authenticate the Definitive Certificates. Neither the Depositor nor
the Trustee shall be liable for any delay in delivery of such instructions and
may conclusively rely on, and shall be protected in relying on, such
instructions. Upon the issuance of Definitive Certificates, the Trustee, the
Certificate Registrar, the Servicer, any Paying Agent and the Depositor shall
recognize the Holders of the Definitive Certificates as Certificateholders
hereunder.
(d) Except with respect to the initial transfer of the Private
Certificates by the Depositor, no transfer, sale, pledge or other disposition of
any Private Certificate shall be made unless such disposition is exempt from the
registration requirements of the Securities Act of 1933, as amended (the "1933
Act"), and any applicable state securities laws or is made in accordance with
the 1933 Act and laws. In the event of any such transfer, (i) unless such
transfer is made in reliance upon Rule 144A (as evidenced by the investment
letter delivered to the Trustee, in substantially the form attached hereto as
Exhibit J) under the 1933 Act, the Trustee and the Depositor shall require a
written Opinion of Counsel (which may be in-house counsel) acceptable to and in
form and substance reasonably satisfactory to the Trustee and the Depositor that
such transfer may be made pursuant to an exemption, describing the applicable
exemption and the basis therefor, from the 1933 Act or is being made pursuant to
the 1933 Act, which Opinion of Counsel shall not be an expense of the Trustee or
the Depositor or (ii) the Trustee shall require the transferor to execute a
transferor certificate (in substantially the form attached hereto as Exhibit L)
and the transferee to execute an investment letter (in substantially the form
attached hereto as Exhibit J) acceptable to and in form and substance reasonably
satisfactory to the Depositor and the Trustee certifying to the Depositor and
the Trustee the facts surrounding such transfer, which investment letter shall
not be an expense of the Trustee or the Depositor. The Holder of a Private
Certificate 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 an ERISA-Restricted Certificate shall be made unless
the Trustee shall have received either (i) a representation from the transferee
of such Certificate, acceptable to and in form and substance satisfactory to the
Trustee and the Depositor, (such requirement is satisfied only by the Trustee's
receipt of a representation letter from the transferee substantially in the form
of Exhibit I hereto, as appropriate), to the effect that such transferee is not
an employee benefit plan or arrangement subject to Section 406 of ERISA or a
plan subject to Section 4975 of the Code, nor a person acting on behalf of any
such plan or arrangement nor using the assets of any such plan or arrangement to
effect such transfer or (ii) (except in the case of a Class R, Class X or Class
BB Certificate) 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) (except in the case of a Class R,
Class X or Class BB Certificate) in the case of any such ERISA-Restricted
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, 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 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 clause (i) of the preceding sentence, such
representation shall be deemed to have been made to the Trustee by the
acceptance by a Certificate Owner of the beneficial interest in any such Class
of ERISA-Restricted Certificates, unless the Trustee shall have received from
the transferee an alternative representation acceptable in form and substance to
the Depositor. 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.
Each Person who has or who acquires any Ownership Interest in a
Class R Certificate shall be deemed by the acceptance or acquisition of such
Ownership Interest to have agreed to be bound by the following provisions and to
have irrevocably appointed the Depositor or its designee as its attorney-in-fact
to negotiate the terms of any mandatory sale under clause (v) below and to
execute all instruments of transfer and to do all other things necessary in
connection with any such sale, and the rights of each Person acquiring any
Ownership Interest in a Class R Certificate are expressly subject to the
following provisions:
(i) Each Person holding or acquiring any Ownership Interest in a
Class R Certificate shall be a Permitted Transferee and shall promptly
notify the Trustee of any change or impending change in its status as a
Permitted Transferee.
(ii) No Person shall acquire an Ownership Interest in a Class R
Certificate unless such Ownership Interest is a pro rata undivided
interest.
(iii) In connection with any proposed transfer of any Ownership
Interest in a Class R Certificate, the Trustee shall as a condition to
registration of the transfer, require delivery to it, in form and
substance satisfactory to it, of each of the following:
A. an affidavit in the form of Exhibit K hereto from the proposed
transferee to the effect that such transferee is a Permitted Transferee and that
it is not acquiring its Ownership Interest in the Class R Certificate that is
the subject of the proposed transfer as a nominee, trustee or agent for any
Person who is not a Permitted Transferee; and
B. a covenant of the proposed transferee to the effect that the
proposed transferee agrees to be bound by and to abide by the transfer
restrictions applicable to the Class R Certificates.
(iv) Any attempted or purported transfer of any Ownership
Interest in a Class R Certificate in violation of the provisions of this
Section shall be absolutely null and void and shall vest no rights in the
purported transferee. If any purported transferee shall, in violation of
the provisions of this Section, become a Holder of a Class R Certificate,
then the prior Holder of such Class R Certificate that is a Permitted
Transferee shall, upon discovery that the registration of transfer of such
Class R Certificate was not in fact permitted by this Section, be restored
to all rights as Holder thereof retroactive to the date of registration of
transfer of such Class R Certificate. The Trustee shall be under no
liability to any Person for any registration of transfer of a Class R
Certificate that is in fact not permitted by this Section or for making
any distributions due on such Class R 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 Trustee received the documents specified
in clause (iii). The Trustee shall be entitled to recover from any Holder
of a Class R Certificate that was in fact not a Permitted Transferee at
the time such distributions were made all distributions made on such Class
R Certificate. Any such distributions so recovered by the Trustee shall be
distributed and delivered by the Trustee to the prior Holder of such Class
R Certificate that is a Permitted Transferee.
(v) If any Person other than a Permitted Transferee acquires any
Ownership Interest in a Class R Certificate in violation of the
restrictions in this Section, then the Trustee shall have the right but
not the obligation, without notice to the Holder of such Class R
Certificate or any other Person having an Ownership Interest therein, to
notify the Depositor to arrange for the sale of such Class R Certificate.
The proceeds of such sale, net of commissions (which may include
commissions payable to the Depositor or its affiliates in connection with
such sale), expenses and taxes due, if any, will be remitted by the
Trustee to the previous Holder of such Class R Certificate that is a
Permitted Transferee, except that in the event that the Trustee determines
that the Holder of such Class R Certificate may be liable for any amount
due under this Section or any other provisions of this Agreement, the
Trustee may withhold a corresponding amount from such remittance as
security for such claim. The terms and conditions of any sale under this
clause (v) shall be determined in the sole discretion of the Trustee and
it shall not be liable to any Person having an Ownership Interest in a
Class R Certificate as a result of its exercise of such discretion.
(vi) If any Person other than a Permitted Transferee acquires any
Ownership Interest in a Class R Certificate in violation of the
restrictions in this Section, then the Trustee will provide to the
Internal Revenue Service, and to the persons specified in Sections
860E(e)(3) and (6) of the Code, information needed to compute the tax
imposed under Section 860E(e)(5) of the Code on transfers of residual
interests to disqualified organizations. The Trustee shall be entitled to
reasonable compensation for providing such information from the person to
whom it is provided.
The foregoing provisions of this Section shall cease to apply to transfers
occurring on or after the date on which there shall have been delivered to the
Trustee, in form and substance satisfactory to the Trustee, (i) written
notification from each Rating Agency that the removal of the restrictions on
Transfer set forth in this Section will not cause such Rating Agency to
downgrade its rating of the Certificates and (ii) an Opinion of Counsel to the
effect that such removal will not cause any REMIC hereunder to fail to qualify
as a REMIC.
(e) No service charge shall be made for any registration of transfer
or exchange of Certificates of any Class, but the Certificate Registrar may
require payment of a sum sufficient to cover any tax or governmental charge that
may be imposed in connection with any transfer or exchange of Certificates.
All Certificates surrendered for registration of transfer or
exchange shall be cancelled by the Certificate Registrar and disposed of
pursuant to its standard procedures.
Section 5.03 Mutilated, Destroyed, Lost or Stolen Certificates.
--
If (i) any mutilated Certificate is surrendered to the Certificate
Registrar or the Certificate Registrar receives evidence to its satisfaction of
the destruction, loss or theft of any Certificate and (ii) there is delivered to
the Trustee, the Depositor and the Certificate Registrar 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 or the Certificate Registrar that such
Certificate has been acquired by a bona fide purchaser, the Trustee shall
execute on behalf of the Trust, authenticate and deliver, in exchange for or in
lieu of any such mutilated, destroyed, lost or stolen Certificate, a new
Certificate of like tenor and Percentage Interest. Upon the issuance of any new
Certificate under this Section, the Trustee or the Certificate Registrar 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 and the Certificate Registrar) in
connection therewith. Any duplicate Certificate issued pursuant to this Section,
shall constitute complete and indefeasible evidence of ownership in the Trust,
as if originally issued, whether or not the lost, stolen or destroyed
Certificate shall be found at any time.
Section 5.04 Persons Deemed Owners.
The Servicer, the Depositor, the Trustee, the Certificate Registrar,
any Paying Agent and any agent of the Servicer, the Depositor, the Certificate
Registrar, any Paying Agent or the Trustee may treat the Person, including a
Depository, in whose name any Certificate is registered as the owner of such
Certificate for the purpose of receiving distributions pursuant to Section 4.01
and 4.02 and for all other purposes whatsoever, and none of the Servicer, the
Trust, the Trustee nor any agent of any of them shall be affected by notice to
the contrary.
Section 5.05 Appointment of Paying Agent.
(a) The Paying Agent shall make distributions to Certificateholders
from the Distribution Account pursuant to Section 4.01 and 4.02 and shall report
the amounts of such distributions to the Trustee. The duties of the Paying Agent
may include the obligation (i) to withdraw funds from the Collection Account
pursuant to Section 3.05 and for the purpose of making the distributions
referred to above and (ii) to distribute statements and provide information to
Certificateholders as required hereunder. The Paying Agent hereunder shall at
all times be an entity duly incorporated and validly existing under the laws of
the United States of America or any state thereof, authorized under such laws to
exercise corporate trust powers and subject to supervision or examination by
federal or state authorities. The Paying Agent shall initially be the Trustee.
The Trustee may appoint a successor to act as Paying Agent, which appointment
shall be reasonably satisfactory to the Depositor and the Rating Agencies.
(b) The Trustee shall cause the Paying Agent (if other than the
Trustee) to execute and deliver to the Trustee an instrument in which such
Paying Agent shall agree with the Trustee that such Paying Agent shall hold all
sums, if any, held by it for payment to the Certificateholders in trust for the
benefit of the Certificateholders entitled thereto until such sums shall be paid
to such Certificateholders and shall agree that it shall comply with all
requirements of the Code regarding the withholding of payments in respect of
Federal income taxes due from Certificate Owners and otherwise comply with the
provisions of this Agreement applicable to it.
ARTICLE VI
THE SELLER, THE SERVICER AND THE DEPOSITOR
Section 6.01 Liability of the Seller, the Servicer and the Depositor.
The Seller and the Servicer shall be liable in accordance herewith
only to the extent of the obligations specifically imposed upon and undertaken
by the Seller or Servicer, as the case may be, herein. The Depositor shall be
liable in accordance herewith only to the extent of the obligations specifically
imposed upon and undertaken by the Depositor.
Section 6.02 Merger or Consolidation of, or Assumption of the
Obligations of, the Seller, the Servicer or the Depositor.
Any entity into which the Seller, the Servicer or the Depositor may
be merged or consolidated, or any entity resulting from any merger, conversion
or consolidation to which the Seller, the Servicer or the Depositor shall be a
party, or any corporation succeeding to the business of the Seller, the Servicer
or the Depositor, shall be the successor of the Seller, the Servicer or the
Depositor, as the case may be, hereunder, without the execution or filing of any
paper or any further act on the part of any of the parties hereto, anything
herein to the contrary notwithstanding; provided, however, that the successor
Servicer shall satisfy all the requirements of Section 7.02 with respect to the
qualifications of a successor Servicer.
Section 6.03 Limitation on Liability of the Servicer and Others.
Neither the Servicer nor any of the directors or officers or
employees or agents of the Servicer shall be under any liability to the Trust or
the Certificateholders for any action taken or for refraining from the taking of
any action by the Servicer in good faith pursuant to this Agreement, or for
errors in judgment; provided, however, that this provision shall not protect the
Servicer or any such Person against any liability which would otherwise be
imposed by reason of its willful misfeasance, bad faith or gross negligence in
the performance of duties of the Servicer or by reason of its reckless disregard
of its obligations and duties of the Servicer hereunder; provided, further, that
this provision shall not be construed to entitle the Servicer to indemnity in
the event that amounts advanced by the Servicer to retire any senior lien exceed
Liquidation Proceeds (in excess of related liquidation expenses) realized with
respect to the related Mortgage Loan. The Servicer and any director or officer
or employee or agent of 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 Servicer and any director or officer or
employee or agent of the Servicer shall be indemnified by the Trust and held
harmless against any loss, liability or expense incurred in connection with 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 its willful misfeasance, bad faith or negligence in the
performance of duties hereunder or by reason of its reckless disregard of
obligations and duties hereunder. The Servicer may undertake any such action
which it may deem necessary or desirable in respect of this Agreement, and the
rights and duties of the parties hereto and the interests of the
Certificateholders hereunder. In such event, the reasonable legal expenses and
costs of such action and any liability resulting therefrom shall be expenses,
costs and liabilities of the Trust and the Servicer shall be entitled to be
reimbursed therefor only pursuant to Section 3.04. The Servicer's right to
indemnity or reimbursement pursuant to this Section shall survive any
resignation or termination of the Servicer pursuant to Section 6.04 or 7.01 with
respect to any losses, expenses, costs or liabilities arising prior to such
resignation or termination (or arising from events that occurred prior to such
resignation or termination). This paragraph shall apply to the Servicer solely
in its capacity as Servicer hereunder and in no other capacities.
Section 6.04 Servicer Not to Resign.
Subject to the provisions of Section 7.01 and Section 6.02, the
Servicer shall not resign from the obligations and duties hereby imposed on it
except (i) upon determination that the performance of its obligations or duties
hereunder are no longer permissible under applicable law or are in material
conflict by reason of applicable law with any other activities carried on by it
or its subsidiaries or Affiliates, the other activities of the Servicer so
causing such a conflict being of a type and nature carried on by the Servicer or
its subsidiaries or Affiliates at the date of this Agreement or (ii) upon
satisfaction of the following conditions: (a) the Servicer has proposed a
successor servicer to the Trustee in writing and such proposed successor
servicer is reasonably acceptable to the Trustee; and (b) each Rating Agency
shall have delivered a letter to the Trustee prior to the appointment of the
successor servicer stating that the proposed appointment of such successor
servicer as Servicer hereunder will not result in the reduction or withdrawal of
the then current rating of the Regular Certificates or the ratings that are in
effect; provided, however, that no such resignation by the Servicer shall become
effective until such successor servicer or, in the case of (i) above, the
Trustee shall have assumed the Servicer's responsibilities and obligations
hereunder or the Trustee shall have designated a successor servicer in
accordance with Section 7.02. Any such resignation shall not relieve the
Servicer of responsibility for any of the obligations specified in Sections 7.01
and 7.02 as obligations that survive the resignation or termination of the
Servicer. Any such determination permitting the resignation of the Servicer
pursuant to clause (i) above shall be evidenced by an Opinion of Counsel to such
effect delivered to the Trustee. Any such determination permitting the
resignation of the Servicer shall be evidenced by an Opinion of Counsel to such
effect delivered to the Trustee.
Section 6.05 Delegation of Duties.
In the ordinary course of business, the Servicer at any time may
delegate any of its duties hereunder to any Person, including any of its
Affiliates, who agrees to conduct such duties in accordance with standards
comparable to those set forth in Section 3.01. Such delegation shall not relieve
the Servicer of its liabilities and responsibilities with respect to such duties
and shall not constitute a resignation within the meaning of Section 6.04. The
Servicer shall provide the Trustee and the Rating Agencies with 60 days prior
written notice prior to the delegation of any of its duties to any Person other
than any of the Servicer's Affiliates or their respective successors and
assigns.
The Trustee and the Depositor hereby specifically (i) consent to the
pledge and assignment by the Servicer of all the Servicer's right, title and
interest in, to and under this Agreement to First Union, for the benefit of
certain lenders, and (ii) provided that no Servicer Event of Termination exists,
agree that upon delivery to the Trustee by First Union of a letter signed by the
Servicer whereunder the Servicer shall resign as Servicer under this Agreement,
the Trustee shall appoint First Union or its designee as successor Servicer,
provided that at the time of such appointment, First Union or such designee
meets the requirements of a successor Servicer pursuant to Section 7.02(a) and
agrees to be subject to the terms of this Agreement. If, pursuant to any
provision hereof, the duties of the Servicer are transferred to a successor, the
entire amount of the Servicing Fee and other compensation payable to the
Servicer pursuant hereto shall thereafter be payable to such successor.
ARTICLE VII
DEFAULT
Section 7.01 Servicer Events of Termination.
(a) If any one of the following events ("Servicer Events of
Termination") shall occur and be continuing:
(i) (A) The failure by the Servicer to make any Advance; or (B)
any other failure by the Servicer to deposit in the Collection Account or
Distribution Account any deposit required to be made under the terms of
this Agreement which continues unremedied for a period of one Business Day
after the date upon which written notice of such failure shall have been
given to the Servicer by the Trustee or by any Holder of a Regular
Certificate evidencing at least 25% of the Voting Rights; or
(ii) The failure by the Servicer to make any required Servicing
Advance which failure continues unremedied for a period of 30 days, or the
failure by the Servicer duly to observe or perform, in any material
respect, any other covenants, obligations or agreements of the Servicer as
set forth in this Agreement, which failure continues unremedied for a
period of 30 days, after the date (A) on which written notice of such
failure, requiring the same to be remedied, shall have been given to the
Servicer by the Trustee or by any Holder of a Regular Certificate
evidencing at least 25% of the Voting Rights or (B) actual knowledge of
such failure by a Servicing Officer of the Servicer; or
(iii) The entry against the Servicer of a decree or order by a
court or agency or supervisory authority having jurisdiction in the
premises for the appointment of a trustee, conservator, receiver or
liquidator in any insolvency, conservatorship, receivership, readjustment
of debt, marshalling of assets and liabilities or similar proceedings, or
for the winding up or liquidation of its affairs, and the continuance of
any such decree or order unstayed and in effect for a period of 60 days;
or
(iv) The Servicer shall voluntarily go into liquidation, consent
to the appointment of a conservator or receiver or liquidator or similar
person in any insolvency, readjustment of debt, marshalling of assets and
liabilities or similar proceedings of or relating to the Servicer or of or
relating to all or substantially all of its property; or a decree or order
of a court or agency or supervisory authority having jurisdiction in the
premises for the appointment of a conservator, receiver, liquidator or
similar person 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,
unbonded or unstayed for a period of 60 days; or the Servicer shall admit
in writing its inability to pay its debts generally as they become due,
file a petition to take advantage of any applicable insolvency or
reorganization statute, make an assignment for the benefit of its
creditors or voluntarily suspend payment of its obligations; or
(v) Cumulative Realized Losses as a percent of the Senior
Enhancement Percentage as of the Closing Date equal or exceed the
following:
Percentage of
the Senior
Enhancement
Percentage as
of the Closing
Date
December 1999 through 10%
November 2002
December 2002 through 20%
November 2003
December 2003 through 30%
November 2004
December 2004 through 35%
November 2005
December 2005 through 40%
November 2006
December 2006 through 45%
November 2007
December 2007 and thereafter 50%; or
(vi) receipt by the Trustee of a letter of resignation signed by
the Servicer and First Union, pursuant to that certain Credit Agreement
among the Servicer and certain Affiliates of the Servicer, as borrowers,
First Union and certain other financial institutions, as lenders, and
First Union, as administrative agent (as amended, modified, restated,
renewed, replaced or extended from time to time).
(b) Then, and in each and every such case, so long as a Servicer
Event of Termination shall not have been remedied within the applicable grace
period, (x) with respect solely to clause (i)(A) above, if such Advance is not
made by 2:00 P.M., New York time, on the Business Day immediately following the
Servicer Remittance Date, the Trustee may terminate all of the rights and
obligations of the Servicer under this Agreement and the Trustee, or a successor
servicer appointed in accordance with Section 7.02, shall immediately make such
Advance and assume, pursuant to Section 7.02, the duties of a successor Servicer
and (y) in the case of (i)(B), (ii), (iii), (iv), (v) and (vi) above, the
Trustee shall, at the direction of the Holders of each Class of Regular
Certificates evidencing Percentage Interests aggregating not less than 51%, by
notice then given in writing to the Servicer (and to the Trustee if given by
Holders of Certificates), terminate all of the rights and obligations of the
Servicer as servicer under this Agreement. Any such notice to the Servicer shall
also be given to each Rating Agency, the Depositor and the Seller. On or after
the receipt by the Servicer (and by the Trustee if such notice is given by the
Holders) of such written notice, all authority and power of the Servicer under
this Agreement, whether with respect to the Certificates or the Mortgage Loans
or otherwise, shall pass to and be vested in the Trustee pursuant to and under
this Section; and, without limitation, the Trustee 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 of each Mortgage Loan and Related Documents or otherwise. The
Servicer agrees to cooperate with the Trustee (or the applicable successor
Servicer) in effecting the termination of the responsibilities and rights of the
Servicer hereunder, including, without limitation, the delivery to the Trustee
of all documents and records requested by it to enable it to assume the
Servicer's functions under this Agreement within ten Business Days subsequent to
such notice, the transfer within one Business Day subsequent to such notice to
the Trustee (or the applicable successor Servicer) for the administration by it
of all cash amounts that shall at the time be held by the Servicer and to be
deposited by it in the Collection Account, the Distribution Account, any REO
Account or any Escrow Account or that have been deposited by the Servicer in
such accounts or thereafter received by the Servicer with respect to the
Mortgage Loans or any REO Property received by the Servicer. All reasonable
costs and expenses (including attorneys' fees) incurred in connection with
transferring the servicing to the successor Servicer and amending this Agreement
to reflect such succession as Servicer pursuant to this Section shall be paid by
the predecessor Servicer (or if the predecessor Servicer is the Trustee, the
initial Servicer) upon presentation of reasonable documentation of such costs
and expenses.
Section 7.02 Trustee to Act; Appointment of Successor.
(a) Within 90 days of the time the Servicer (and the Trustee, if
notice is sent by the Holders) receives a notice of termination pursuant to
Section 7.01 or 6.04, the Trustee (or such other successor Servicer as is
approved in accordance with this Agreement) shall be the successor in all
respects 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 arising on and after its succession.
As compensation therefor, the Trustee (or such other successor Servicer) shall
be entitled to such compensation as the Servicer would have been entitled to
hereunder if no such notice of termination had been given. Notwithstanding the
above, (i) if the Trustee is unwilling to act as successor Servicer or (ii) if
the Trustee is legally unable so to act, the Trustee shall appoint or petition a
court of competent jurisdiction to appoint, any established housing and home
finance institution, bank or other mortgage loan or home equity loan servicer
having a net worth of not less than $50,000,000 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; provided, that the appointment of any
such successor Servicer will not result in the qualification, reduction or
withdrawal of the ratings assigned to the Certificates or the ratings that are
in effect by the Rating Agencies as evidenced by a letter to such effect from
the Rating Agencies. Pending appointment of a successor to the Servicer
hereunder, unless the Trustee is prohibited by law from so acting, the Trustee
shall act in such capacity as hereinabove provided. In connection with such
appointment and assumption, the successor shall be entitled to receive
compensation out of payments on Mortgage Loans in an amount equal to the
compensation which the Servicer would otherwise have received pursuant to
Section 3.18 (or such other compensation as the Trustee and such successor shall
agree, not to exceed the Servicing Fee). The appointment of a successor Servicer
shall not affect any liability of the predecessor Servicer which may have arisen
under this Agreement prior to its termination as Servicer to pay any deductible
under an insurance policy pursuant to Section 3.12 or to indemnify the Trustee
pursuant to Section 3.26, nor shall any successor Servicer be liable for any
acts or omissions of the predecessor Servicer or for any breach by such Servicer
of any of its representations or warranties contained herein or in any related
document or agreement. The Trustee and such successor shall take such action,
consistent with this Agreement, as shall be necessary to effectuate any such
succession.
In the event of a Servicer Event of Termination, notwithstanding
anything to the contrary above, the Trustee and the Depositor hereby agree that
upon delivery to the Trustee by First Union of a letter signed by the Servicer
within ten Business Days of when notification of such event shall have been
provided to the Trustee, whereunder the Servicer shall resign as Servicer under
this Agreement, the Trustee shall appoint First Union or its designee as
successor Servicer (provided that at the time of such appointment First Union or
such designee meets the requirements of a successor Servicer set forth above)
and First Union agrees to be subject to the terms of this Agreement.
(b) Any successor, including the Trustee, to the Servicer as
servicer shall during the term of its service as servicer continue to service
and administer the Mortgage Loans for the benefit of Certificateholders, and
maintain in force a policy or policies of insurance covering errors and
omissions in the performance of its obligations as Servicer hereunder and a
Fidelity Bond in respect of its officers, employees and agents to the same
extent as the Servicer is so required pursuant to Section 3.12.
Section 7.03 Waiver of Defaults.
The Majority Certificateholders may, on behalf of all
Certificateholders, waive any events permitting removal of the Servicer as
servicer pursuant to this Article VII, provided, however, that the Majority
Certificateholders may not waive a default in making a required distribution on
a Certificate without the consent of the Holder of such Certificate. Upon any
waiver of a past default, such default shall cease to exist and any Servicer
Event of Termination arising therefrom shall be deemed to have been remedied for
every purpose of this Agreement. No such waiver shall extend to any subsequent
or other default or impair any right consequent thereto except to the extent
expressly so waived. Notice of any such waiver shall be given by the Trustee to
the Rating Agencies.
Section 7.04 Notification to Certificateholders.
(a) Upon any termination or appointment of a successor the Servicer
pursuant to this Article VII or Section 6.04, the Trustee shall give prompt
written notice thereof to the Certificateholders at their respective addresses
appearing in the Certificate Register and each Rating Agency.
(b) No later than 60 days after the occurrence of any event which
constitutes or which, with notice or a lapse of time or both, would constitute a
Servicer Event of Termination for five Business Days after a Responsible Officer
of the Trustee becomes aware of the occurrence of such an event, the Trustee
shall transmit by mail to all Certificateholders notice of such occurrence
unless such default or Servicer Event of Termination shall have been waived or
cured. Such notice shall be given to the Rating Agencies promptly after any such
occurrence.
Section 7.05 Survivability of Servicer Liabilities.
Notwithstanding anything herein to the contrary, upon termination of
the Servicer hereunder, any liabilities of the Servicer which accrued prior to
such termination shall survive such termination.
ARTICLE VIII
THE TRUSTEE
Section 8.01 Duties of Trustee.
--
The Trustee, prior to the occurrence of a Servicer Event of
Termination of which a Responsible Officer of the Trustee shall have actual
knowledge and after the curing of all Servicer Events of Termination which may
have occurred, undertakes to perform such duties and only such duties as are
specifically set forth in this Agreement. If a Servicer Event of Termination has
occurred (which has not been cured) of which a Responsible Officer has actual
knowledge, the Trustee shall exercise such of the rights and powers vested in it
by this Agreement, and use the same degree of care and skill in their exercise,
as a prudent person would exercise or use under the circumstances in the conduct
of such person's own affairs.
The Trustee, upon receipt of all resolutions, certificates,
statements, opinions, reports, documents, orders or other instruments furnished
to the Trustee which are specifically required to be furnished pursuant to any
provision of this Agreement, shall examine them to determine whether they
conform to the requirements of this Agreement; provided, however, that that the
Trustee shall not be responsible for the accuracy or content of any resolution,
certificate, statement, opinion, report, document, order or other instrument
furnished by the Servicer, the Seller or the Depositor hereunder. If any such
instrument is found not to conform in any material respect to the requirements
of this Agreement, the Trustee shall notify the Certificateholders of such
instrument in the event that the Trustee, after so requesting, does not receive
a satisfactorily corrected instrument.
No provision of this Agreement shall be construed to relieve the
Trustee from liability for its own negligent action, its own negligent failure
to act or its own misconduct; provided, however, that:
(i) prior to the occurrence of a Servicer Event of Termination,
and after the curing of all such Servicer Events of Termination which may
have occurred, the duties and obligations of the Trustee shall be
determined solely by the express provisions of this Agreement, the Trustee
shall not be liable except for the performance of such duties and
obligations as are specifically set forth in this Agreement, no implied
covenants or obligations shall be read into this Agreement against the
Trustee and, in the absence of bad faith on the part of the Trustee, the
Trustee may conclusively rely, as to the truth of the statements and the
correctness of the opinions expressed therein, upon any certificates or
opinions furnished to the Trustee and conforming to the requirements of
this Agreement;
(ii) the Trustee shall not be personally liable for an error of
judgment made in good faith by a Responsible Officer of the Trustee,
unless it shall be proved that the Trustee was negligent in ascertaining
or investigating the facts related thereto;
(iii) the Trustee shall not be personally liable with respect to
any action taken, suffered or omitted to be taken by it in good faith in
accordance with the direction of the Majority Certificateholders relating
to the time, method and place of conducting any proceeding for any remedy
available to the Trustee, or exercising or omitting to exercise any trust
or power conferred upon the Trustee, under this Agreement; and
(iv) the Trustee shall not be charged with knowledge of any
failure by the Servicer to comply with the obligations of the Servicer
referred to in clauses (i) and (ii) of Section 7.01 or any Servicer Event
of Termination unless a Responsible Officer of the Trustee at the
Corporate Trust Office obtains actual knowledge of such failure or the
Trustee receives written notice of such failure from the Servicer or the
Majority Certificateholders. In the absence of such receipt of such
notice, the Trustee may conclusively assume that there is no Servicer
Event of Termination.
The Trustee shall not be required to expend or risk its own funds or
otherwise incur financial liability in the performance of any of its duties
hereunder, or in the exercise of any of its rights or powers, if there is
reasonable ground for believing that the repayment of such funds or adequate
indemnity against such risk or liability is not reasonably assured to it, and
none of the provisions contained in this Agreement shall in any event require
the Trustee 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 Trustee 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.
The Trustee shall have no duty (A) to see 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 8.02 Certain Matters Affecting the Trustee.
(a) Except as otherwise provided in Section 8.01:
(i) the Trustee may request and rely upon, and shall be protected
in acting or refraining from acting upon, any resolution, Officer's
Certificate, certificate of auditors or any other certificate, statement,
instrument, opinion, report, notice, request, consent, order, appraisal,
bond or other paper or document reasonably believed by it to be genuine
and to have been signed or presented by the proper party or parties;
(ii) the Trustee may consult with counsel 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) the Trustee shall be under no obligation to exercise any of
the 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 the Certificateholders pursuant to the
provisions of this Agreement, unless such Certificateholders shall have
offered to the Trustee reasonable security or indemnity against the costs,
expenses and liabilities which may be incurred therein or thereby; the
right of the Trustee to perform any discretionary act enumerated in this
Agreement shall not be construed as a duty, and the Trustee shall not be
answerable for other than its negligence or willful misconduct in the
performance of any such act;
(iv) the Trustee shall not be personally 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;
(v) prior to the occurrence of a Servicer Event of Termination
and after the curing of all Servicer Events of Termination which may have
occurred, the Trustee shall not be bound to make any investigation into
the facts or matters stated in any resolution, certificate, statement,
instrument, opinion, report, notice, request, consent, order, approval,
bond or other paper or documents, unless requested in writing to do so by
the Majority Certificateholder; provided, however, that if the payment
within a reasonable time to the Trustee of the costs, expenses or
liabilities likely to be incurred by it in the making of such
investigation is, in the opinion of the Trustee, not reasonably assured to
the Trustee by the security afforded to it by the terms of this Agreement,
the Trustee may require reasonable indemnity against such cost, expense or
liability as a condition to such proceeding. The reasonable expense of
every such examination shall be paid by the Servicer or, if paid by the
Trustee, shall be reimbursed by the Servicer upon demand. Nothing in this
clause (v) shall derogate from the obligation of the Servicer to observe
any applicable law prohibiting disclosure of information regarding the
Mortgagors;
(vi) the Trustee shall not be accountable, shall have no
liability and makes no representation as to any acts or omissions
hereunder of the Servicer until such time as the Trustee may be required
to act as Servicer pursuant to Section 7.02;
(vii) the Trustee may execute any of the trusts or powers
hereunder or perform any duties hereunder either directly or by or through
agents or attorneys or a custodian and the Trustee shall not be
responsible for any misconduct or negligence on the part of any such
agent, attorney or custodian appointed by the Trustee with due care; and
(viii) the right of the Trustee to perform any discretionary act
enumerated in this Agreement shall not be construed as a duty, and the
Trustee shall not be answerable for other than its negligence or willful
misconduct in the performance of such act.
Section 8.03 Trustee Not Liable for Certificates or Mortgage Loans.
The recitals contained herein and in the Certificates (other than
the authentication of the Trustee on the Certificates) shall be taken as the
statements of the Seller, and the Trustee assumes no responsibility for the
correctness of the same. The Trustee makes no representations as to the validity
or sufficiency of this Agreement or of the Certificates (other than the
signature and authentication of the Trustee on the Certificates) or of any
Mortgage Loan or Related Document. The Trustee shall not be accountable for the
use or application by the Servicer, or for the use or application of any funds
paid to the Servicer in respect of the Mortgage Loans or deposited in or
withdrawn from the Collection Account by the Servicer. The Trustee shall at no
time have any responsibility or liability for or with respect to the legality,
validity and enforceability of any Mortgage or any Mortgage Loan, or the
perfection and priority of any Mortgage or the maintenance of any such
perfection and priority, or for or with respect to the sufficiency of the Trust
or its ability to generate the payments to be distributed to Certificateholders
under this Agreement, including, without limitation: the existence, condition
and ownership of any Mortgaged Property; the existence and enforceability of any
hazard insurance thereon (other than if the Trustee shall assume the duties of
the Servicer pursuant to Section 7.02); the validity of the assignment of any
Mortgage Loan to the Trustee or of any intervening assignment; the completeness
of any Mortgage Loan; the performance or enforcement of any Mortgage Loan (other
than if the Trustee shall assume the duties of the Servicer pursuant to Section
7.02); the compliance by the Depositor, the Seller or the Servicer with any
warranty or representation made under this Agreement or in any related document
or the accuracy of any such warranty or representation prior to the Trustee's
receipt of notice or other discovery of any non-compliance therewith or any
breach thereof; any investment of monies by or at the direction of the Servicer
or any loss resulting therefrom, it being understood that the Trustee shall
remain responsible for any Trust property that it may hold in its individual
capacity; the acts or omissions of any of the Servicer (other than if the
Trustee shall assume the duties of the Servicer pursuant to Section 7.02), or
any Mortgagor; any action of the Servicer (other than if the Trustee shall
assume the duties of the Servicer pursuant to Section 7.02), taken in the name
of the Trustee; the failure of the Servicer to act or perform any duties
required of it as agent of the Trustee hereunder; or any action by the Trustee
taken at the instruction of the Servicer (other than if the Trustee shall assume
the duties of the Servicer pursuant to Section 7.02); provided, however, that
the foregoing shall not relieve the Trustee of its obligation to perform its
duties under this Agreement. The Trustee shall have no responsibility for filing
any financing or continuation statement in any public office at any time or to
otherwise perfect or maintain the perfection of any security interest or lien
granted to it hereunder (unless the Trustee shall have become the successor
Servicer).
Section 8.04 Trustee May Own Certificates.
The Trustee in its individual or any other capacity may become the
owner or pledgee of Certificates with the same rights as it would have if it
were not Trustee and may transact any banking and trust business with the
Seller, the Servicer, the Depositor or their Affiliates.
Section 8.05 Seller to Pay Trustee Fees and Expenses.
Prior to disbursing the Available Funds, the Trustee shall withdraw
from the Distribution Account on each Distribution Date and pay to itself the
Trustee Fee and, to the extent funds therein are at any time insufficient for
such purpose, the Seller shall pay such fees as reasonable compensation (which
shall not be limited by any provision of law in regard to the compensation of a
trustee of an express trust) for all services rendered by it in the execution of
the trusts hereby created and in the exercise and performance of any of the
powers and duties hereunder of the Trustee, and the Seller will pay or reimburse
the Trustee upon its request for all reasonable expenses, disbursements and
advances incurred or made by the Trustee in accordance with any of the
provisions of this Agreement (including the reasonable compensation and the
expenses and disbursements of its counsel and of all persons not regularly in
its employ) except any such expense, disbursement or advance as may arise from
its negligence or bad faith or which is the responsibility of Certificateholders
or the Trustee hereunder. In addition, the Seller covenants and agrees to
indemnify the Trustee and its officers, directors, employees and agents from,
and hold it harmless against, any and all losses, liabilities, damages, claims
or expenses incurred in connection with any legal action relating to this
Agreement or the Certificates, other than any loss, liability or expense
incurred by reason of willful misfeasance, bad faith or negligence of the
Trustee in the performance of its duties hereunder or by reason of the Trustee's
reckless disregard of obligations and duties hereunder. Anything in this
Agreement to the contrary notwithstanding, in no event shall the Trustee be
liable for special, indirect or consequential loss or damage of any kind
whatsoever (including but not limited to lost profits), even if the Trustee has
been advised of the likelihood of such loss or damage and regardless of the form
of action. The Trustee and any director, officer, employee or agent of the
Trustee shall be indemnified, to the extent not paid by the Servicer pursuant to
this Section, by the Trust Fund and held harmless against any loss, liability or
expense (not including expenses, disbursements and advances incurred or made by
the Trustee, including the compensation and the expenses and disbursements of
its agents (other than the Custodian) and its counsel, in the ordinary course of
the Trustee's performance in accordance with the provisions of this Agreement)
incurred by the Trustee or such party arising out of or in connection with the
acceptance or administration of its duties under this Agreement, other than any
loss, liability or expense incurred by reason of willful misfeasance, bad faith
or negligence in the performance by the Trustee of its duties under this
Agreement or by reason of the reckless disregard of the Trustee's obligations
and duties under this Agreement. This section shall survive termination of this
Agreement or the resignation or removal of any Trustee hereunder.
Section 8.06 Eligibility Requirements for Trustee.
The Trustee hereunder shall at all times be a Department of Housing
and Urban Development and Federal Housing Administration approved mortgagee, an
entity duly organized and validly existing under the laws of the United States
of America or any state thereof, authorized under such laws to exercise
corporate trust powers, having a combined capital and surplus of at least
$50,000,000 and a minimum long-term debt rating of BBB by Fitch and a long-term
debt rating of at least A1 or better by Moody's, and subject to supervision or
examination by federal or state authority. If such entity 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 entity shall be deemed to
be its combined capital and surplus as set forth in its most recent report of
condition so published. The principal office of the Trustee (other than the
initial Trustee) shall be in a state with respect to which an Opinion of Counsel
has been delivered to such Trustee at the time such Trustee is appointed Trustee
to the effect that the Trust will not be a taxable entity under the laws of such
state. In case at any time the Trustee shall cease to be eligible in accordance
with the provisions of this Section 8.06, the Trustee shall resign immediately
in the manner and with the effect specified in Section 8.07.
Section 8.07 Resignation or Removal of Trustee.
The Trustee may at any time resign and be discharged from the trusts
hereby created by giving written notice thereof to the Depositor, the Servicer
and each Rating Agency. Upon receiving such notice of resignation, the Depositor
shall promptly appoint a successor Trustee by written instrument, in duplicate,
one copy of which instrument shall be delivered to the resigning Trustee and one
copy to the successor Trustee. If no successor Trustee shall have been so
appointed and having accepted appointment within 30 days after the giving of
such notice of resignation, the resigning Trustee may petition any court of
competent jurisdiction for the appointment of a successor Trustee.
If at any time the Trustee shall cease to be eligible in accordance
with the provisions of Section 8.06 and shall fail to resign after written
request therefor by the Depositor, or if at any time the Trustee shall be
legally unable to act, or shall be adjudged a bankrupt or insolvent, or a
receiver of the Trustee or of its property shall be appointed, or any public
officer shall take charge or control of the Trustee or of its property or
affairs for the purpose of rehabilitation, conservation or liquidation, then the
Depositor may remove the Trustee. If the Depositor or the Servicer removes the
Trustee under the authority of the immediately preceding sentence, the Depositor
shall promptly appoint a successor Trustee by written instrument, in duplicate,
one copy of which instrument shall be delivered to the Trustee so removed and
one copy to the successor Trustee.
The Majority Certificateholders may at any time remove the Trustee
by written instrument or instruments delivered to the Servicer, the Depositor
and the Trustee; the Depositor shall thereupon use its best efforts to appoint a
successor Trustee in accordance with this Section.
Any resignation or removal of the Trustee and appointment of a
successor Trustee pursuant to any of the provisions of this Section 8.07 shall
not become effective until acceptance of appointment by the successor Trustee as
provided in Section 8.08.
Section 8.08 Successor Trustee.
Any successor Trustee appointed as provided in Section 8.07 shall
execute, acknowledge and deliver to the Depositor, the Rating Agencies, the
Servicer and to its predecessor Trustee an instrument accepting such appointment
hereunder, and thereupon the resignation or removal of the predecessor Trustee
shall become effective, and such successor Trustee, without any further act,
deed or conveyance, shall become fully vested with all the rights, powers,
duties and obligations of its predecessor hereunder, with like effect as if
originally named as Trustee. The Depositor, the Servicer and the predecessor
Trustee shall execute and deliver such instruments and do such other things as
may reasonably be required for fully and certainly vesting and confirming in the
successor Trustee all such rights, powers, duties and obligations.
No successor Trustee shall accept appointment as provided in this
Section 8.08 unless at the time of such acceptance such successor Trustee shall
be eligible under the provisions of Section 8.06 and the appointment of such
successor Trustee shall not result in a downgrading of the Regular Certificates
by either Rating Agency, as evidenced by a letter from each Rating Agency.
Upon acceptance of appointment by a successor Trustee as provided in
this Section 8.08, the successor Trustee shall mail notice of the appointment of
a successor Trustee hereunder to all Holders of Certificates at their addresses
as shown in the Certificate Register and to each Rating Agency.
Section 8.09 Merger or Consolidation of Trustee.
Any entity into which the Trustee may be merged or converted or with
which it may be consolidated, or any entity resulting from any merger,
conversion or consolidation to which the Trustee shall be a party, or any entity
succeeding to the business of the Trustee, shall be the successor of the Trustee
hereunder, provided such entity shall be eligible under the provisions of
Section 8.06 and 8.08, without the execution or filing of any paper or any
further act on the part of any of the parties hereto, anything herein to the
contrary notwithstanding.
Section 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 or any Mortgaged Property may at the time be located, the
Depositor and the Trustee acting jointly shall have the power and shall execute
and deliver all instruments to appoint one or more Persons approved by the
Trustee to act as co-trustee or co-trustees, jointly with the Trustee, or
separate trustee or separate trustees, of all or any part of the Trust, and to
vest in such Person or Persons, in such capacity and for the benefit of the
Certificateholders, such title to the Trust, or any part thereof, 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. Any such co-trustee or separate trustee shall be subject to the
written approval of the Servicer. If the Servicer shall not have joined in such
appointment within 15 days after the receipt by it of a request so to do, 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. The Servicer shall be responsible for the fees of any co-trustee
or separate trustee appointed hereunder.
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) all rights, powers, duties and obligations conferred or
imposed upon the Trustee shall be conferred or imposed upon and exercised
or performed by the Trustee and such separate trustee or co-trustee
jointly (it being understood that such separate trustee or co-trustee is
not authorized to act separately without the Trustee joining in such act),
except to the extent that under any law of any jurisdiction in which any
particular act or acts are to be performed (whether as Trustee hereunder
or as successor to the Servicer hereunder), the Trustee shall be
incompetent or unqualified to perform such act or acts, in which event
such rights, powers, duties and obligations (including the holding of
title to the Trust 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
(iii) the Servicer and the Trustee, acting jointly may at any
time accept the resignation of or remove any separate trustee or
co-trustee except that following the occurrence of a Servicer Event of
Termination, the Trustee acting alone may accept the resignation or remove
any 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 then separate trustees and co-trustees,
as effectively as if given to each of them. Every instrument appointing any
separate trustee or co-trustee shall refer to this Agreement and the conditions
of this Article 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
Depositor, the Rating Agencies and the Servicer.
Any separate trustee or co-trustee may, at any time, constitute the
Trustee, its agent or attorney-in-fact, with full power and authority, to the
extent not prohibited by law, to do any lawful act under or in respect of this
Agreement on its behalf and in its name. If any separate trustee or co-trustee
shall die, become incapable of acting, resign or be removed, all of its estates,
properties, rights, remedies and trusts shall vest in and be exercised by the
Trustee, to the extent permitted by law, without the appointment of a new or
successor Trustee.
Section 8.11 Limitation of Liability.
The Certificates are executed by the Trustee, not in its individual
capacity but solely as Trustee of the Trust, in the exercise of the powers and
authority conferred and vested in it by this Agreement. Each of the undertakings
and agreements made on the part of the Trustee in the Certificates is made and
intended not as a personal undertaking or agreement by the Trustee but is made
and intended for the purpose of binding only the Trust.
Section 8.12 Trustee May Enforce Claims Without Possession of
Certificates.
(a) All rights of action and claims under this Agreement or the
Certificates may be prosecuted and enforced by the Trustee without the
possession of any of the Certificates or the production thereof in any
proceeding relating thereto, and such proceeding instituted by the Trustee shall
be brought in its own name or in its capacity as Trustee for the benefit of all
Holders of such Certificates, subject to the provisions of this Agreement. Any
recovery of judgment shall, after provision for the payment of the reasonable
compensation, expenses, disbursement and advances of the Trustee, its agents and
counsel, be for the ratable benefit of the Certificateholders in respect of
which such judgment has been recovered.
(b) The Trustee shall afford the Seller, the Depositor, the Servicer
and each Certificateholder upon reasonable notice during normal business hours,
access to all records maintained by the Trustee in respect of its duties
hereunder and access to officers of the Trustee responsible for performing such
duties. The Trustee shall cooperate fully with the Seller, the Servicer, the
Depositor and such Certificateholder and shall make available to the Seller, the
Servicer, the Depositor and such Certificateholder for review and copying at the
expense of the party requesting such copies, such books, documents or records as
may be requested with respect to the Trustee's duties hereunder. The Seller, the
Depositor, the Servicer and the Certificateholders shall not have any
responsibility or liability for any action or failure to act by the Trustee and
are not obligated to supervise the performance of the Trustee under this
Agreement or otherwise.
Section 8.13 Suits for Enforcement.
In case a Servicer Event of Termination or other default by the
Servicer or the Seller hereunder shall occur and be continuing, the Trustee may
proceed to protect and enforce its rights and the rights of the
Certificateholders under this Agreement by a suit, action or proceeding in
equity or at law or otherwise, whether for the specific performance of any
covenant or agreement contained in this Agreement or in aid of the execution of
any power granted in this Agreement or for the enforcement of any other legal,
equitable or other remedy, as the Trustee, being advised by counsel, and subject
to the foregoing, shall deem most effectual to protect and enforce any of the
rights of the Trustee and the Certificateholders.
Section 8.14 Waiver of Bond Requirement.
The Trustee shall be relieved of, and each Certificateholder hereby
waives, any requirement of any jurisdiction in which the Trust, or any part
thereof, may be located that the Trustee post a bond or other surety with any
court, agency or body whatsoever.
Section 8.15 Waiver of Inventory, Accounting and Appraisal
Requirement.
The Trustee shall be relieved of, and each Certificateholder hereby
waives, any requirement of any jurisdiction in which the Trust, or any part
thereof, may be located that the Trustee file any inventory, accounting or
appraisal of the Trust with any court, agency or body at any time or in any
manner whatsoever.
Section 8.16 Trustee Covenants Concerning Year 2000 Compliance.
-
The Trustee covenants that to the best knowledge of the Trustee,
relying on vendor and manufacturer warranties, that any custom-made software or
hardware designed or purchased or licensed by the Trustee and used by the
Trustee in the course of operation or management of, or the compiling, reporting
or generation of data required by the Trustee, will be capable of identifying,
correcting, performing calculations and processing accurately, such date with
respect to dates after December 31, 1999.
ARTICLE IX
REMIC ADMINISTRATION
Section 9.01 REMIC Administration.
(a) The Trustee shall make or cause to be made REMIC elections for
each of REMIC 1, REMIC 2, REMIC 3 and REMIC 4 as set forth in the Preliminary
Statement on Forms 1066 or other appropriate federal tax or information return
for the taxable year ending on the last day of the calendar year in which the
Certificates are issued. The regular interests and residual interest in each
REMIC shall be as designated in the Preliminary Statement.
(b) The Closing Date is hereby designated as the "Startup Day" of
each REMIC within the meaning of section 860G(a)(9) of the Code.
(c) The Servicer shall pay any and all tax related expenses (not
including taxes) of each REMIC, including but not limited to any professional
fees or expenses related to audits or any administrative or judicial proceedings
with respect to such REMIC that involve the Internal Revenue Service or state
tax authorities, but only to the extent that (i) such expenses are ordinary or
routine expenses, including expenses of a routine audit but not expenses of
litigation (except as described in (ii)); or (ii) such expenses or liabilities
(including taxes and penalties) are attributable to the negligence or willful
misconduct of the Servicer in fulfilling its duties hereunder. The Servicer
shall be entitled to reimbursement of expenses to the extent provided in clause
(i) above from the Collection Account.
(d) The Trustee shall prepare or cause to be prepared, sign and file
or cause to be filed, each REMIC's federal and state tax and information returns
as such REMIC's direct representative. The expenses of preparing and filing such
returns shall be borne by the Trustee.
(e) The Holder of the Class R Certificate shall be the "tax matters
person" as defined in the REMIC Provisions (the "Tax Matters Person") with
respect to each REMIC and shall act as Tax Matters Person for each REMIC. The
Trustee, as agent for the Tax Matters Person, shall perform, on behalf of each
REMIC, all reporting and other tax compliance duties that are the responsibility
of such REMIC under the Code, the REMIC Provisions, or other compliance guidance
issued by the Internal Revenue Service or any state or local taxing authority.
Among its other duties, if required by the Code, the REMIC Provisions, or other
such guidance, the Trustee, as agent for the Tax Matters Person, shall provide
(i) to the Treasury or other governmental authority such information as is
necessary for the application of any tax relating to the transfer of a Residual
Certificate to any disqualified person or organization and (ii) to the
Certificateholders such information or reports as are required by the Code or
REMIC Provisions.
(f) The Trustee, the Servicer, and the Holders of Certificates shall
take any action or cause any REMIC to take any action necessary to create or
maintain the status of such REMIC as a REMIC under the REMIC Provisions and
shall assist each other as necessary to create or maintain such status. Neither
the Trustee, the Servicer, nor the Holder of any Residual Certificate shall take
any action or cause any REMIC to take any action or fail to take (or fail to
cause to be taken) any action that, under the REMIC Provisions, if taken or not
taken, as the case may be, could (i) endanger the status of such REMIC as a
REMIC or (ii) result in the imposition of a tax upon such REMIC (including but
not limited to the tax on prohibited transactions as defined in Code Section
860F(a)(2) and the tax on prohibited contributions set forth on Section 860G(d)
of the Code) (either such event, an "Adverse REMIC Event") unless the Trustee
and the Servicer have received an Opinion of Counsel (at the expense of the
party seeking to take such action) to the effect that the contemplated action
will not endanger such status or result in the imposition of such a tax. In
addition, prior to taking any action with respect to any REMIC or the assets
therein, or causing such REMIC to take any action, which is not expressly
permitted under the terms of this Agreement, any Holder of a Residual
Certificate will consult with the Trustee and the Servicer, or their respective
designees, in writing, with respect to whether such action could cause an
Adverse REMIC Event to occur with respect to such REMIC, and no such Person
shall take any such action or cause such REMIC to take any such action as to
which the Trustee or the Servicer has advised it in writing that an Adverse
REMIC Event could occur.
(g) Each Holder of a Residual Certificate shall pay when due its pro
rata share of any and all taxes imposed on any REMIC by federal or state
governmental authorities. To the extent that such REMIC taxes are not paid by
Residual Certificateholders, the Trustee shall pay any remaining REMIC taxes out
of current or future amounts otherwise distributable to the Holder of the
Residual Certificate in each REMIC or, if no such amounts are available, out of
other amounts held in the Collection Account, and shall reduce amounts otherwise
payable to Holders of the REMIC Regular Interests or the Certificates, as the
case may be.
(h) The Trustee, shall, for federal income tax purposes, maintain or
cause to be maintained books and records with respect to each REMIC on a
calendar year and on an accrual basis.
(i) No additional contributions of assets shall be made to any
REMIC, except as expressly provided in this Agreement with respect to Eligible
Substitute Mortgage Loans.
(j) Neither the Trustee nor the Servicer shall enter into any
arrangement by which any REMIC will receive a fee or other compensation for
services.
(k) On or before April 15 of each calendar year beginning in 2000,
the Servicer shall deliver to the Trustee and each Rating Agency an Officer's
Certificate stating the Servicer's compliance with the provisions of this
Section 9.01.
(l) The Trustee shall treat the rights of the Class A-1A
Certificateholders to receive payments in respect of LIBOR Carryover Amounts as
a right in an interest rate cap contract written by the Class X and Class BB
Certificateholders, as beneficial owners of the Class X/BB Interest, in favor of
the Class A-1A Certificateholders and the Trustee shall account for such as
property held separate and apart from the regular interests it holds in REMIC 1,
REMIC 2, REMIC 3 and REMIC 4. This provision is intended to satisfy the
requirements of Treasury regulation Section 1.860G-2(i) for the treatment of
property rights coupled with regular interests to be separately respected and
shall be interpreted consistent with such regulation. For purposes of
determining the issue price of the Class T4-A1A Interest, the Trustee shall
assume that the interest rate cap contract has a value of zero. On each
Distribution Date, to the extent the Class A-1A Certificates receive interest in
excess of the Maximum Rate (as defined in the first sentence of the definition
thereof), such interest will be treated as paid to the Class X/BB Interest in
respect of interest on the REMIC 4 Components, pro rata, and then paid to the
Class A-1A Certificates pursuant to an interest rate cap agreement.
(m) In the event that the beneficial ownership of the Class BB
Certificates and the Class X Certificates is held by a single Person for federal
income tax purposes, such Person shall be treated as the beneficial owner of the
Class X/BB Interest and the REMIC 4 Components represented thereby and the Class
BB Reserve Fund. In the event that beneficial ownership of the Class BB and the
Class X Certificates is held by two or more Persons for tax purposes, the
Trustee shall treat the Class BB Certificateholders and the Class X
Certificateholders as partners in a partnership that owns the Class X/BB
Interest and the Class BB Reserve Fund for federal income tax purposes and shall
not treat the Class BB and Class X Certificates as an interest in any REMIC
created hereunder. By acquiring the Class BB Certificates and the Class X
Certificates, the respective Holders will agree to treat the Class BB
Certificates and the Class X Certificates in the manner described in the
preceding sentence for federal income tax purposes in the event that the
beneficial ownership of the Class BB Certificates and the Class X Certificates
is separated. In such event, (i) a separate capital account shall be established
and maintained for each Holder of a Class BB or Class X Certificate in
accordance with Treasury Regulations Section 1.704-1(b)(2)(iv), which shall be
credited with income or gain and debited by any expenses or losses and
distributions allocable to such Certificates, (ii) the Class BB Certificates
shall be allocated income in an amount equal to interest at the Pass-Through
Rate thereon and any original issue discount that would be reportable thereon if
the Class BB Certificate were a debt instrument issued on the date ownership of
the Class BB and Class X Certificates is separated, with a principal balance
equal to its Notional Amount, (iii) the Class X Certificates shall be allocated
all remaining income and any expenses and Realized Losses with respect to the
Class X/BB Interest and any income or loss with respect to the Class BB Reserve
Fund, until the capital account of the Class X Certificates is reduced to zero,
and any remaining expenses or losses shall be allocated to the Class BB
Certificates, (iv) neither the Class BB Certificates nor the Class X
Certificates shall be responsible for restoring any deficit to its capital
account, (v) upon termination of the Trust Fund pursuant to Article X, all
amounts available for distribution to Holders of the Class BB and Class X
Certificates shall be distributed in accordance with their positive capital
account balances (allocating any remaining Class BB Reserve Fund to the Class X
Certificates) and (vi) the Trustee will prepare or cause to be prepared, and
cause the Holder of the largest Percentage Interest of the Class X Certificates
to sign and file or cause to be filed all federal and state tax and information
returns for the partnership and shall furnish or cause to be furnished Schedule
K-1's to the Holders of the Class BB and Class X Certificates at the time
required by the Code. The Holder of the largest Percentage Interest of the Class
X Certificates, by acceptance of its Class X Certificate, agrees to act as "tax
matters partner" (within the meaning of Section 6231(a)(7) of the Code and to
sign and timely file all federal and state partnership tax and information
returns prepared by the Trustee pursuant to this Section 9.01(m).
Section 9.02 Prohibited Transactions and Activities.
Neither the Seller, the Depositor, the Servicer nor the Trustee
shall sell, dispose of, or substitute for any of the Mortgage Loans, except in a
disposition pursuant to (i) the foreclosure of a Mortgage Loan, (ii) the
bankruptcy of the Trust Fund, (iii) the termination of any REMIC pursuant to
Article X of this Agreement, (iv) a substitution pursuant to Article II of this
Agreement or (v) a repurchase of Mortgage Loans pursuant to Article II of this
Agreement, nor acquire any assets for any REMIC, nor sell or dispose of any
investments in the Distribution Account for gain, nor accept any contributions
to any REMIC after the Closing Date, unless it has received an Opinion of
Counsel (at the expense of the party causing such sale, disposition, or
substitution) that such disposition, acquisition, substitution, or acceptance
will not (a) affect adversely the status of such REMIC as a REMIC or of the
interests therein other than the Residual Certificates as the regular interests
therein, (b) affect the distribution of interest or principal on the
Certificates, (c) result in the encumbrance of the assets transferred or
assigned to the Trust Fund (except pursuant to the provisions of this Agreement)
or (d) cause such REMIC to be subject to a tax on prohibited transactions or
prohibited contributions pursuant to the REMIC Provisions.
Section 9.03 Indemnification with Respect to Certain Taxes and Loss
of REMIC Status.
In the event that any REMIC formed hereunder fails to qualify as a
REMIC, loses its status as a REMIC, or incurs federal, state or local taxes as a
result of a prohibited transaction or prohibited contribution under the REMIC
Provisions due to the negligent performance by the Servicer of its duties and
obligations set forth herein, the Servicer shall indemnify the Holder of the
related Residual Certificate against any and all losses, claims, damages,
liabilities or expenses ("Losses") resulting from such negligence; provided,
however, that the Servicer shall not be liable for any such Losses attributable
to the action or inaction of the Trustee, the Depositor or the Holder of such
Residual Certificate, as applicable, nor for any such Losses resulting from
misinformation provided by the Holder of such Residual Certificate on which the
Servicer has relied. The foregoing shall not be deemed to limit or restrict the
rights and remedies of the Holder of such Residual Certificate now or hereafter
existing at law or in equity. Notwithstanding the foregoing, however, in no
event shall the Servicer have any liability (1) for any action or omission that
is taken in accordance with and in compliance with the express terms of, or
which is expressly permitted by the terms of, this Agreement, (2) for any Losses
other than arising out of a negligent performance by the Servicer of its duties
and obligations set forth herein, and (3) for any special or consequential
damages to Certificateholders (in addition to payment of principal and interest
on the Certificates).
Section 9.04 REO Property.
(a) Subject to compliance with applicable laws and regulations as
shall at any time be in force, and notwithstanding any other provision of this
Agreement, the Servicer, acting on behalf of the Trustee hereunder, shall not
rent, lease, or otherwise earn income on behalf of any REMIC with respect to any
REO Property which might cause such REO Property to fail to qualify as
"foreclosure" property within the meaning of section 860G(a)(8) of the Code or
result in the receipt by any REMIC of any "income from non-permitted assets"
within the meaning of section 860F(a)(2) of the Code or any "net income from
foreclosure property" which is subject to tax under the REMIC Provisions unless
the Servicer has advised, or has caused the applicable Servicer to advise, the
Trustee in writing to the effect that, under the REMIC Provisions, such action
would not adversely affect the status of any REMIC as a REMIC and any income
generated for such REMIC by the REO Property would not result in the imposition
of a tax upon such REMIC.
(b) The Servicer shall make reasonable efforts to sell any REO
Property for its fair market value. In any event, however, the Servicer shall
dispose of any REO Property before the close of the third calendar year
beginning after the year of its acquisition by the Trust Fund unless the
Servicer has received a grant of extension from the Internal Revenue Service to
the effect that, under the REMIC Provisions and any relevant proposed
legislation and under applicable state law, any REMIC may hold REO Property for
a longer period without adversely affecting its REMIC status or causing the
imposition of a Federal or state tax upon any REMIC. If the Servicer has
received such an extension, then the Servicer shall continue to attempt to sell
the REO Property for its fair market value for such longer period as such
extension permits (the "Extended Period"). If the Servicer has not received such
an extension and the Servicer is unable to sell the REO Property within 33
months after its acquisition by the Trust Fund or if the Servicer has received
such an extension, and the Servicer is unable to sell the REO Property within
the period ending three months before the close of the Extended Period, the
Servicer shall, before the end of the applicable period, (i) purchase such REO
Property at a price equal to the REO Property's fair market value or (ii)
auction the REO Property to the highest bidder (which may be the Servicer) in an
auction reasonably designed to produce a fair price prior to the expiration of
the applicable period.
ARTICLE X
TERMINATION
Section 10.01 Termination.
(a) The respective obligations and responsibilities of the Seller,
the Servicer, the Depositor and the Trustee created hereby (other than the
obligation of the Trustee to make certain payments to Certificateholders after
the final Distribution Date and the obligation of the Servicer to send certain
notices as hereinafter set forth) shall terminate upon notice to the Trustee
upon the earliest of (i) the Distribution Date on which the Certificate
Principal Balance of each Class of Certificates has been reduced to zero, (ii)
the final payment or other liquidation of the last Mortgage Loan in the Trust,
and (iii) the optional purchase by the Seller of the Mortgage Loans in both Loan
Groups as described below. Notwithstanding the foregoing, in no event shall the
trust created hereby continue beyond the expiration of 21 years from the death
of the last survivor of the descendants of Joseph P. Kennedy, the late
ambassador of the United States to the Court of St. James's, living on the date
hereof.
The Seller may, at its option, terminate the Mortgage Loans in the
Trust Fund and retire the Offered Certificates on the next succeeding
Distribution Date upon which the aggregate current Pool Balance is less than 10%
of the aggregate Pool Balance of the Mortgage Loans as of the Cut-off Date by
purchasing all of the outstanding Mortgage Loans and REO Properties in the Trust
Fund at a price equal to the sum of the outstanding Principal Balance of the
Mortgage Loans and accrued and unpaid interest thereon at the weighted average
of the Mortgage Interest Rates through the end of the Collection Period
preceding the final Distribution Date plus unreimbursed Servicing Advances,
Advances and any unpaid Servicing Fees and Special Servicing Fees allocable to
such Mortgage Loans and REO Properties (the "Termination Price").
In connection with any such purchase pursuant to the preceding
paragraph, the Servicer shall deposit in the Distribution Account all amounts
then on deposit in the Collection Account (less amounts permitted to be
withdrawn by the Servicer pursuant to Section 3.07), which deposit shall be
deemed to have occurred immediately following such purchase.
Any such purchase shall be accomplished by deposit into the
Collection Account as part of Available Funds on the Determination Date before
such Distribution Date of the Termination Price and the delivery of an opinion
of counsel that such termination is a "qualified liquidation" under Section 860F
of the Code.
(b) Notice of any termination, specifying the Distribution Date
(which shall be a date that would otherwise be a Distribution Date) upon which
the Certificateholders may surrender their Certificates to the Trustee for
payment of the final distribution and cancellation, shall be given promptly by
the Trustee upon the Trustee receiving notice of such date from the Servicer, by
letter to the Certificateholders mailed not earlier than the 15th day and not
later than the 25th day of the month next preceding the month of such final
distribution specifying (1) the Distribution Date upon which final distribution
of the Certificates will be made upon presentation and surrender of such
Certificates at the office or agency of the Trustee therein designated, (2) the
amount of any such final distribution and (3) 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 or agency
of the Trustee therein specified.
(c) Upon presentation and surrender of the Certificates, the Trustee
shall cause to be distributed to the Holders of the Certificates on the
Distribution Date for such final distribution, in proportion to the Percentage
Interests of their respective Class and to the extent that funds are available
for such purpose, an amount equal to the amount required to be distributed to
such Holders in accordance with the provisions of Sections 4.01 and 4.02 for
such Distribution Date.
(d) In the event that all Certificateholders shall not surrender
their Certificates for final payment and cancellation on or before such final
Distribution Date, the Trustee shall promptly following such date cause all
funds in the Distribution Account not distributed in final distribution to
Certificateholders to be withdrawn therefrom and credited to the remaining
Certificateholders by depositing such funds in a separate escrow account for the
benefit of such Certificateholders, and the Seller (if the Seller has exercised
its right to purchase the Mortgage Loans) or the Trustee (in any other case)
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 nine months after the second notice all the
Certificates shall not have been surrendered for cancellation, the Class R
Certificateholder shall be entitled to all unclaimed funds and other assets
which remain subject hereto, and the Trustee upon transfer of such funds shall
be discharged of any responsibility for such funds, and the Certificateholders
shall look to the Class R Certificateholder for payment.
Section 10.02 Additional Termination Requirements.
(a) In the event that the Seller exercises its purchase option as
provided in Section 10.01, the Trust shall be terminated in accordance with the
following additional requirements, unless the Trustee shall have been furnished
with an Opinion of Counsel to the effect that the failure of the Trust to comply
with the requirements of this Section will not (i) result in the imposition of
taxes on "prohibited transactions" of the Trust as defined in Section 860F of
the Code or (ii) cause any REMIC constituting part of the Trust Fund to fail to
qualify as a REMIC at any time that any Certificates are outstanding:
(i) The Trustee shall designate a date within 90 days prior to
the final Distribution Date as the date of adoption of plans of complete
liquidation of each of REMIC 1, REMIC 2, REMIC 3 and REMIC 4 and shall
specify such date in the final federal income tax return of each REMIC;
(ii) After the date of adoption of such plans of complete
liquidation and at or prior to the final Distribution Date, the Trustee
shall sell all of the assets of the Trust to the Majority Class R
Certificateholder or the Servicer, as applicable, for cash; and
(iii) At the time of the making of the final payment on the
Certificates, the Trustee shall distribute or credit, or cause to be
distributed or credited (A) to the Holders of each of the Class A-1A,
Class A-1F, Class A-2F, Class M-1, Class M-2 and Class B Certificates, the
related Certificate Principal Balance, as applicable, plus one month's
interest thereon at the applicable Pass-Through Rate, (B) to the Class BB
and Class X Certificates in respect of the Class X/BB Interest, the amount
of any remaining Monthly Excess Cash Flow Amounts not previously
distributed thereon, (C) to the remaining REMIC Regular Interests the
amounts allocable thereto pursuant to Section 4.09 and (D) to the Class R
Certificateholders, all cash on hand after such payment (other than cash
retained to meet claims) and the Trust shall terminate at such time.
(b) By their acceptance of Certificates, the Holders thereof hereby
agree to appoint the Trustee as their attorney in fact to: (i) designate such
date of adoption of plans of complete liquidation and (ii) to take such other
action in connection therewith as may be reasonably required to carry out such
plans of complete liquidation all in accordance with the terms hereof.
ARTICLE XI
MISCELLANEOUS PROVISIONS
Section 11.01 Amendment.
This Agreement may be amended from time to time by Seller, the
Depositor, the Servicer and the Trustee; and without the consent of the
Certificateholders, (i) to cure any ambiguity, (ii) to correct or supplement any
provisions herein which may be defective or inconsistent with any other
provisions herein or (iii) to make any other provisions with respect to matters
or questions arising under this Agreement, which shall not be inconsistent with
the provisions of this Agreement; provided, however, that any such action listed
in clause (i) through (iii) above shall not adversely affect in any respect the
interests of any Certificateholder, as evidenced by (i) notice in writing to the
Depositor, the Servicer and the Trustee from the Rating Agencies that such
action will not result in the reduction or withdrawal of the rating of any
outstanding Class of Certificates with respect to which it is a Rating Agency,
or (ii) an Opinion of Counsel delivered to the Servicer and the Trustee.
In addition, this Agreement may be amended from time to time by
Seller, the Depositor, the Servicer and the Trustee, with the consent of the
Majority Certificateholders 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 or waiver shall (x) reduce in any manner the
amount of, or delay the timing of, payments on the Certificates which are
required to be made on any Certificate without the consent of the Holder of such
Certificate, (y) adversely affect in any material respect the interests of the
Holders of any Class of Certificates in a manner other than as described in
clause (x) above, without the consent of the Holders of Certificates of such
Class evidencing at least a 66% Percentage Interest in such Class, or (z) reduce
the percentage of Voting Rights required by clause (y) above without the consent
of the Holders of all Certificates of such Class then outstanding. Upon approval
of an amendment, a copy of such amendment shall be sent to the Rating Agencies.
Prior to the execution of any amendment to this Agreement, the Trustee shall be
entitled to receive and rely upon an Opinion of Counsel (at the expense of the
Person seeking such amendment) stating that the execution of such amendment is
authorized or permitted by this Agreement. The Trustee may, but shall not be
obligated to, enter into any such amendment which affects the Trustee's own
rights, duties or immunities under this Agreement.
Notwithstanding any provision of this Agreement to the contrary, the
Trustee shall not consent to any amendment to this Agreement unless it shall
have first received an Opinion of Counsel, delivered by (and at the expense of)
the Person seeking such Amendment, to the effect that such amendment will not
result in the imposition of a tax on any REMIC constituting part of the Trust
Fund pursuant to the REMIC Provisions or cause any REMIC constituting part of
the Trust to fail to qualify as a REMIC at any time that any Certificates are
outstanding and that the amendment is being made in accordance with the terms
hereof.
Promptly after the execution of any such amendment the Trustee shall
furnish, at the expense of the Person that requested the amendment if such
Person is the Seller or the Servicer (but in no event at the expense of the
Trustee), otherwise at the expense of the Trust, a copy of such amendment and
the Opinion of Counsel referred to in the immediately preceding paragraph to the
Servicer and each Rating Agency.
It shall not be necessary for the consent of Certificateholders
under this Section 11.01 to approve the particular form of any proposed
amendment; instead 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.
The Trustee may, but shall not be obligated to, enter into any
amendment pursuant to this 11.01 Section that affects its rights, duties and
immunities under this Agreement or otherwise.
Section 11.02 Recordation of Agreement; Counterparts.
To the extent permitted by applicable law, this Agreement is subject
to recordation in all appropriate public offices for real property records in
all the counties or other comparable jurisdictions in which any or all of the
properties subject to the Mortgages are situated, and in any other appropriate
public recording office or elsewhere, such recordation to be effected by the
Servicer at the expense of the Trust, but only upon direction of
Certificateholders, 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 together constitute but
one and the same instrument.
Section 11.03 Limitation on Rights of Certificateholders.
The death or incapacity of any Certificateholder shall not (i)
operate to terminate this Agreement or the Trust, (ii) entitle such
Certificateholder's legal representatives or heirs to claim an accounting or to
take any action or proceeding in any court for a partition or winding up of the
Trust, or (iii) otherwise affect the rights, obligations and liabilities of the
parties hereto or any of them.
Except as expressly provided for herein, no Certificateholder shall
have any right to vote or in any manner otherwise control the operation and
management of the Trust, or the obligations of the parties hereto, nor shall
anything herein set forth or contained in the terms of the Certificates be
construed so as to 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 person 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 of any provision
of this Agreement to institute any suit, action or proceeding in equity or at
law upon or under or with respect to this Agreement, unless such Holder
previously shall have given to the Trustee a written notice of default and of
the continuance thereof, as herein provided, and unless also the Holders of
Certificates entitled to at least 25% of the Voting Rights shall have made
written request upon the Trustee to institute such action, suit or proceeding in
its own name as Trustee hereunder and shall have offered to the Trustee such
reasonable indemnity as it may require against the costs, expenses and
liabilities to be incurred therein or thereby, and the Trustee for 15 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 is understood
and intended, and expressly covenanted by each Certificateholder with every
other Certificateholder and the Trustee, that no one or more Holders of
Certificates shall have any right in any manner whatever by virtue of any
provision of this Agreement to affect, disturb or prejudice the rights of the
Holders of any other of such Certificates, or to obtain or seek to obtain
priority over or preference to any other such Holder, which priority or
preference is not otherwise provided for herein, or to enforce any right under
this Agreement, except in the manner herein provided and for the equal, ratable
and common benefit of all Certificateholders. For the protection and enforcement
of the provisions of this Section 11.03 each and every Certificateholder and the
Trustee shall be entitled to such relief as can be given either at law or in
equity.
Section 11.04 Governing Law; Jurisdiction.
This Agreement shall be construed in accordance with the laws of the
State of New York, and the obligations, rights and remedies of the parties
hereunder shall be determined in accordance with such laws. With respect to any
claim arising out of this Agreement, each party irrevocably submits to the
exclusive jurisdiction of the courts of the State of New York and the United
States District Court located in the Borough of Manhattan in The City of New
York, and each party irrevocably waives any objection which it may have at any
time to the laying of venue of any suit, action or proceeding arising out of or
relating hereto brought in any such courts, irrevocably waives any claim that
any such suit, action or proceeding brought in any such court has been brought
in any inconvenient forum and further irrevocably waives the right to object,
with respect to such claim, suit, action or proceeding brought in any such
court, that such court does not have jurisdiction over such party, provided that
service of process has been made by any lawful means.
Section 11.05 Notices.
All directions, demands and notices hereunder shall be in writing
and shall be deemed to have been duly given if personally delivered at or mailed
by first class mail, postage prepaid, or by express delivery service, to (a) in
the case of the Seller, Credit-Based Asset Servicing and Securitization LLC, 335
Madison Avenue, 26th Floor, New York, New York, Attention: Saul Sanders, Chief
Operating Officer (telecopy number (212) 850-7760), or such other address or
telecopy number as may hereafter be furnished to the Depositor and the Trustee
in writing by the Seller, (b) in the case of the Trustee, The Chase Manhattan
Bank, 450 West 33rd Street, 14th Floor, New York, New York 10001, Attention:
Capital Markets Fiduciary Services, Asset Backed Funding Certificates, Series
1999-1, or such other address as may hereafter be furnished to the Depositor,
the Seller and the Servicer in writing by the Trustee, (c) in the case of the
Depositor, Asset Backed Funding Corporation, 100 North Tryon Street, 11th Floor,
Charlotte, N.C. 28255 Attention: Asset Backed Funding Certificates, Series
1999-1, or such other address as may be furnished to the Seller, the Servicer
and the Trustee in writing by the Depositor, and (d) in the case of the
Servicer, Litton Loan Servicing LP, 5373 W. Alabama, Suite 600, Houston, Texas
77056, Attention: Janice McClure, or such other address as may be furnished to
the Seller, the Depositor and the Trustee in writing by the Servicer. Any notice
required or permitted to be mailed to a Certificateholder shall be given by
first class mail, postage prepaid, at the address of such Holder as shown in the
Certificate Register. Notice of any Servicer Event of Termination shall be given
by telecopy and by certified mail. Any notice so mailed within the time
prescribed in this Agreement shall be conclusively presumed to have duly been
given when mailed, whether or not the Certificateholder receives such notice. A
copy of any notice required to be telecopied hereunder shall also be mailed to
the appropriate party in the manner set forth above.
Section 11.06 Severability of Provisions.
If any one or more of the covenants, agreements, provisions or terms
of this Agreement shall for any reason whatsoever be 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 11.07 Article and Section References.
All article and section references used in this Agreement, unless
otherwise provided, are to articles and sections in this Agreement.
Section 11.08 Notice to the Rating Agencies.
(a) Each of the Trustee and the Servicer shall be obligated to use
its best reasonable efforts promptly to provide notice to the Rating Agencies
with respect to each of the following of which a Responsible Officer of the
Trustee or Servicer, as the case may be, has actual knowledge:
(i) any material change or amendment to this Agreement;
(ii) the occurrence of any Servicer Event of Termination that has
not been cured or waived;
(iii) the resignation or termination of the Servicer or the
Trustee;
(iv) the final payment to Holders of the Certificates of any
Class;
(v) any change in the location of any Account; and
(vi) if the Trustee is acting as successor Servicer pursuant to
Section 7.02 hereof, any event that would result in the inability of the
Trustee to make Advances.
(b) In addition, (i) the Trustee shall promptly furnish to each
Rating Agency copies of each Statement to Certificateholders described in
Section 4.03 hereof; and
(ii) the Servicer shall promptly furnish to each Rating
Agency copies of the following:
(A) each annual statement as to compliance described in
Section 3.19 hereof;
(B) each annual independent public accountants' servicing
report described in Section 3.20 hereof; and
(C) each notice delivered pursuant to Section 7.01(a) hereof
which relates to the fact that the Servicer has not made an Advance.
Any such notice pursuant to this Section 11.08 shall be in writing
and shall be deemed to have been duly given if personally delivered or mailed by
first class mail, postage prepaid, or by express delivery service to Moody's
Investors Service, 99 Church Street, New York, New York 10005, Attention:
Managing Director, Residential Mortgage-Backed Securities; Fitch IBCA, Inc.,
State Street Plaza, New York, New York 10004, Attention: Christopher Schiavone;
and Duff & Phelps Credit Rating Co., 17 State Street, New York, New York 10004,
Attention: Michael Nelson.
Section 11.09 Further Assurances.
Notwithstanding any other provision of this Agreement, neither the
Regular Certificateholders nor the Trustee shall have any obligation to consent
to any amendment or modification of this Agreement unless they have been
provided reasonable security or indemnity against their out-of-pocket expenses
(including reasonable attorneys' fees) to be incurred in connection therewith.
Section 11.10 Benefits of Agreement.
Nothing in this Agreement or in the Certificates, expressed or
implied, shall give to any Person, other than the Certificateholders and the
parties hereto and their successors hereunder, any benefit or any legal or
equitable right, remedy or claim under this Agreement.
Section 11.11 Acts of Certificateholders.
(a) Any request, demand, authorization, direction, notice, consent,
waiver or other action provided by this Agreement to be given or taken by the
Certificateholders may be embodied in and evidenced by one or more instruments
of substantially similar tenor signed by such Certificateholders in person or by
agent duly appointed in writing; and such action shall become effective when
such instrument or instruments are delivered to the Trustee, Seller and the
Servicer. Such instrument or instruments (and the action embodied therein and
evidenced thereby) are herein sometimes referred to as the "act" of the
Certificateholders signing such instrument or instruments. Proof of execution of
any such instrument or of a writing appointing any such agent shall be
sufficient for any purpose of this Agreement and conclusive in favor of the
Trustee and the Trust, if made in the manner provided in this Section 11.11.
(b) The fact and date of the execution by any Person of any such
instrument or writing may be proved by the affidavit of a witness of such
execution or by the certificate of a notary public or other officer authorized
by law to take acknowledgments of deeds, certifying that the individual signing
such instrument or writing acknowledged to him the execution thereof. Whenever
such execution is by a signer acting in a capacity other than his or her
individual capacity, such certificate or affidavit shall also constitute
sufficient proof of his authority.
(c) Any request, demand, authorization, direction, notice, consent,
waiver or other action by any Certificateholder shall bind every future Holder
of such Certificate and the Holder of every Certificate issued upon the
registration of transfer thereof or in exchange therefor or in lieu thereof, in
respect of anything done, omitted or suffered to be done by the Trustee or the
Trust in reliance thereon, whether or not notation of such action is made upon
such Certificate.
<PAGE>
IN WITNESS WHEREOF, the Seller, the Depositor, the Servicer and the
Trustee have caused their names to be signed hereto by their respective officers
thereunto duly authorized, all as of the day and year first above written.
ASSET BACKED FUNDING CORPORATION, as Depositor
By:
------------------------------------
Name:
Title: Vice President
CREDIT-BASED ASSET SERVICING AND SECURITIZATION
LLC, as Seller
By:
------------------------------------
Name:
Title:
LITTON LOAN SERVICING LP, as Servicer
By:
------------------------------------
Name:
Title:
THE CHASE MANHATTAN BANK, as Trustee
By:
------------------------------------
Name:
Title:
<PAGE>
STATE OF )
) ss.:
COUNTY OF )
On the 21st day of December, 1999 before me, a notary public in and
for said State, personally appeared ______________ known to me to be a Vice
President of Asset Backed Funding Corporation, a Delaware corporation that
executed the within instrument, and also known to me to be the person who
executed it on behalf of said corporation, and acknowledged to me that such
corporation executed the within instrument.
IN WITNESS WHEREOF, I have hereunto set my hand and affixed my
official seal the day and year in this certificate first above written.
Notary Public
<PAGE>
STATE OF )
) ss.:
COUNTY OF )
On the 21st day of December, 1999 before me, a notary public in and
for said State, personally appeared ______________ known to me to be a
_______________________ of Credit-Based Asset Servicing and Securitization LLC,
a limited liability company that executed the within instrument, and also known
to me to be the person who executed it on behalf of said limited liability
company, and acknowledged to me that such limited liability company 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
<PAGE>
STATE OF )
) ss.:
COUNTY OF )
On the 21st day of December, 1999 before me, a notary public in and
for said State, personally appeared _______________, known to me to be
____________________ of The Chase Manhattan Bank, a New York banking corporation
that executed the within instrument, and also known to me to be the person who
executed it on behalf of said association, 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
<PAGE>
STATE OF )
) ss.:
COUNTY OF )
On the 21st day of December, 1999 before me, a notary public in and
for said State, personally appeared _______________, known to me to be a of
Litton Loan Servicing LP, a _______________ limited partnership, that executed
the within instrument, and also known to me to be the person who executed it on
behalf of said limited partnership, and acknowledged to me that such limited
partnership 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
<PAGE>
EXHIBIT Q
Officer's Certificate
Asset Backed Funding Certificates, Series 1999-1
[Date]
Via Facsimile
The Chase Manhattan Bank, Trustee
450 W. 33rd Street, 14th Floor
New York, NY 10001
Re: Pre-Payments
Dear Sir or Madam:
__________________ hereby certifies that he/she is an officer of the
Servicer, holding the office set forth beneath his/her name and hereby further
certifies as follows:
With respect to the Mortgage Loans, as the term is defined in the
Pooling and Servicing Agreement, set forth in the attached schedule:
(1)___A Principal Prepayment in full was received during the related
Collection Period;
(2)___Any prepayment penalty due under the terms of the Mortgage
Note with respect to such Principal Prepayment in full was received from the
mortgagor and deposited in the Collection Account; ____ Yes ____ No
(3)___As to each Mortgage Loan so noted on the attached schedule,
all or part of the prepayment penalty required in connection with the Principal
Prepayment in full was waived based upon (Circle one): (i) the Servicer's
determination that such waiver would maximize recovery of Liquidation Proceeds
for such Mortgage Loan, taking into account the value of such prepayment
penalty, or (ii)(A) the enforceability thereof be limited (1) by bankruptcy
insolvency, moratorium, receivership, or other similar law relating to
creditors' rights generally or (2) due to acceleration in connection with a
foreclosure or other involuntary payment, or (B) the enforceability is otherwise
limited or prohibited by applicable law;
(4)___We certify that all amounts due in connection with the waiver
of a prepayment penalty inconsistent with number 3 above which are required to
be deposited by the Servicer pursuant to Section 3.01 of the Pooling and
Servicing Agreement, have been or will be so deposited.
By [Servicer]
(Name)
Its: (Title)
<PAGE>
EXHIBIT A-1
[FORM OF THE CLASS A-1A CERTIFICATE]
ASSET BACKED FUNDING CERTIFICATES
SERIES 1999-1, CLASS A-1A
UNLESS THIS CERTIFICATE IS PRESENTED BY AN AUTHORIZED REPRESENTATIVE OF
THE DEPOSITORY TRUST COMPANY, A NEW YORK CORPORATION ("DTC"), TO THE
TRUSTEE OR ITS AGENT FOR REGISTRATION OF TRANSFER, EXCHANGE, OR PAYMENT,
AND ANY CERTIFICATE ISSUED IS REGISTERED IN THE NAME OF CEDE & CO. OR IN
SUCH OTHER NAME AS IS REQUESTED BY AN AUTHORIZED REPRESENTATIVE OF DTC
(AND ANY PAYMENT IS MADE TO CEDE & CO. OR TO SUCH OTHER ENTITY AS IS
REQUESTED BY AN AUTHORIZED REPRESENTATIVE OF DTC), ANY TRANSFER, PLEDGE,
OR OTHER USE HEREOF FOR VALUE OR OTHERWISE BY OR TO ANY PERSON IS WRONGFUL
INASMUCH AS THE REGISTERED OWNER HEREOF, CEDE & CO., HAS AN INTEREST
HEREIN.
SOLELY FOR U.S. FEDERAL INCOME TAX PURPOSES, THIS CERTIFICATE REPRESENTS
OWNERSHIP OF 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").
Series 1999-1, Class A-1A Original Class Certificate Principal
Balance of the Class A-1A Certificates
Pass-Through Rate: Variable as of the Closing Date:
$
Date of Pooling and Servicing Agreement
and Cut-off Date: November 1, 1999 Denomination: $
First Distribution Date: December 27, Servicer: Litton Loan Servicing LP
1999
Trustee: The Chase Manhattan Bank
No.
Closing Date: December 21, 1999
CUSIP:
DISTRIBUTIONS IN REDUCTION OF THE CERTIFICATE PRINCIPAL BALANCE OF THIS
CERTIFICATE MAY BE MADE MONTHLY AS SET FORTH HEREIN. ACCORDINGLY, THE
OUTSTANDING CERTIFICATE PRINCIPAL BALANCE HEREOF AT ANY TIME MAY BE LESS
THAN THE AMOUNT SHOWN ABOVE.
ASSET BACKED FUNDING CERTIFICATE
evidencing a beneficial ownership interest in a portion of a Trust Fund
consisting primarily of a pool of conventional one- to four-family first
mortgage loans formed and sold by
ASSET BACKED FUNDING CORPORATION
THIS CERTIFICATE DOES NOT REPRESENT AN OBLIGATION OF OR INTEREST IN
ASSET BACKED FUNDING CORPORATION, THE SERVICER, THE TRUSTEE OR ANY OF
THEIR AFFILIATES. NEITHER THIS CERTIFICATE NOR THE UNDERLYING MORTGAGE
LOANS ARE GUARANTEED BY ANY AGENCY OR INSTRUMENTALITY OF THE UNITED
STATES.
This certifies that _______________ is the registered owner of a
Percentage Interest (obtained by dividing the denomination of this Certificate
by the Original Class Certificate Principal Balance of the Class A-1A
Certificates) in that certain beneficial ownership interest evidenced by all the
Class A-1A Certificates in the Trust Fund created pursuant to a Pooling and
Servicing Agreement, dated as specified above (the "Agreement"), among Asset
Backed Funding Corporation (hereinafter called the "Depositor," which term
includes any successor entity under the Agreement), the Servicer and the
Trustee, a summary of certain of the pertinent provisions of which is set forth
hereafter. 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.
Pursuant to the terms of the Agreement, distributions 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 (a "Distribution Date"), commencing on the
first Distribution Date specified above, to the Person in whose name this
Certificate is registered on the Business Day immediately preceding such
Distribution Date (the "Record Date"), from funds in the Distribution Account in
an amount equal to the product of the Percentage Interest evidenced by this
Certificate and the amount required to be distributed to the Holders of Class
A-1A Certificates on such Distribution Date pursuant to the Agreement provided,
however, that if any Class A-1A Certificate becomes a Definitive Certificate (as
defined herein), the Record Date for such Certificate will be the last Business
Day of the month immediately preceding the month in which the related
Distribution Date occurs.
All distributions to the Holder of this Certificate under the
Agreement will be made or caused to be made by or on behalf of the Trustee by
wire transfer in immediately available funds to the account of the Person
entitled thereto if such Person shall have so notified the Trustee in writing at
least five Business Days prior to the Record Date immediately prior to such
Distribution Date and is the registered owner of Class A-1A Certificates the
aggregate initial Certificate Principal Balance of which is in excess of
$5,000,000, or by check mailed by first class mail to the address of the Person
entitled thereto, as such name and address shall appear on the Certificate
Register, provided that the Trustee may deduct a reasonable wire transfer fee
from any payment made by wire transfer. Notwithstanding the above, the final
distribution on this Certificate will be made after due notice by the Trustee of
the pendency of such distribution and only upon presentation and surrender of
this Certificate at the office or agency appointed by the Trustee for that
purpose as provided in the Agreement.
The Pass-Through Rate on the Class A-1A Certificates on each
Distribution Date will be a rate per annum equal to the sum of one month LIBOR
plus the Class A-1A Certificate Margin. Interest will accrue on the Class A-1A
Certificates during each Interest Accrual Period at a rate equal to the lesser
of (i) the Class A-1A Pass Through Rate and (ii) the applicable Maximum Rate for
such Distribution Date.
This Certificate is one of a duly authorized issue of Certificates
designated as Asset Backed Funding Certificates of the Series specified on the
face hereof (herein called the "Certificates") and representing a Percentage
Interest in the Class A-1A Certificates.
The Class A-1A Certificates are limited in right of payment to
certain collections and recoveries respecting the Mortgage Loans, all as more
specifically set forth herein and in the Agreement. As provided in the
Agreement, withdrawals from the Collection Account and the Distribution Account
may be made from time to time for purposes other than distributions to
Certificateholders, such purposes including reimbursement of advances made, or
certain expenses incurred, with respect to the Mortgage Loans.
The Agreement permits, with certain exceptions therein provided, the
amendment thereof and the modification of the rights and obligations of the
Depositor, the Servicer, the Trustee and the rights of the Certificateholders
under the Agreement at any time by the Depositor, the Servicer and the Trustee
with the consent of the Holders of Certificates entitled to the Voting Rights
identified 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 herefor 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 upon surrender of this Certificate for registration of
transfer at the offices or agencies appointed by the Trustee as provided in the
Agreement, duly endorsed by, or accompanied by an assignment in the form below
or other 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 evidencing the same aggregate
Percentage Interest will be issued to the designated transferee or transferees.
The Certificates are issuable in fully registered form only without
coupons in Classes and denominations representing Percentage Interests 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 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 of Certificates, but the Trustee may require payment of a sum
sufficient to cover any tax or other governmental charge that may be imposed in
connection with any transfer or exchange of Certificates.
The Depositor, the Servicer, the Trustee and the Certificate
Registrar and any agent of the Depositor, the Servicer, the Trustee or the
Certificate Registrar may treat the Person in whose name this Certificate is
registered as the owner hereof for all purposes, and none of the Depositor, the
Servicer, the Trustee, the Certificate Registrar nor any such agent shall be
affected by notice to the contrary.
The obligations created by the Agreement and the Trust Fund created
thereby shall terminate upon payment to the Certificateholders of all amounts
held by or on behalf of the Trustee and required to be paid to them pursuant to
the Agreement following the earlier of (i) the final payment or other
liquidation (or any advance with respect thereto) of the last Mortgage Loan
remaining in the Trust Fund, and (ii) the purchase by the party designated in
the Agreement at a price determined as provided in the Agreement from the Trust
Fund of all Mortgage Loans and all property acquired in respect of such Mortgage
Loans. The Agreement permits, but does not require, the party designated in the
Agreement to purchase from the Trust Fund all Mortgage Loans and all property
acquired in respect of any Mortgage Loan at a price determined as provided in
the Agreement. The exercise of such right will effect early retirement of the
Certificates; however, such right to purchase is subject to the aggregate
Principal Balance of the Mortgage Loans at the time of purchase being 10% or
less of the Cut-off Date Aggregate Principal Balance.
The recitals contained herein shall be taken as statements of the
Depositor and the Trustee assumes no responsibility for their correctness.
Unless the certificate of authentication hereon has been executed by
the Certificate Registrar, by manual signature, this Certificate shall not be
entitled to any benefit under the Agreement or be valid for any purpose.
<PAGE>
IN WITNESS WHEREOF, the Trustee has caused this Certificate to be
duly executed.
Dated: December 21, 1999
THE CHASE MANHATTAN BANK, as Trustee
By:____________________________
Authorized Officer
CERTIFICATE OF AUTHENTICATION
This is one of the Class A-1A Certificates referred to in the
within-mentioned Agreement.
THE CHASE MANHATTAN BANK, as Certificate
Registrar
By:_______________________________
Authorized Signatory
Date of authentication: December 21, 1999
<PAGE>
ABBREVIATIONS
The following abbreviations, when used in the inscription on the face of this
instrument, shall be construed as though they were written out in full according
to applicable laws or regulations:
TEN COM - as tenants in common UNIF GIFT MIN ACT - Custodian
(Cust) (Minor)
TEN ENT - as tenants by the entireties under Uniform Gifts
to Minors Act
JT TEN - as joint tenants with right
if survivorship and not as ___________________
tenants in common (State)
Additional abbreviations may also be used though not in the above
list.
ASSIGNMENT
FOR VALUE RECEIVED, the undersigned hereby sell(s), assign(s) and
transfer(s) unto _______________________________________________________________
________________________________________________________________________________
(Please print or typewrite name, address including postal zip code, and Taxpayer
Identification Number of assignee)______________________________________________
________________________________________________________________________________
a Percentage Interest equal to ____% evidenced by the within asset-backed
Certificate and hereby authorize(s) the registration of transfer of such
interest to assignee on the Certificate Register of the Trust Fund.
I (we) further direct the Certificate Registrar to issue a new
Certificate of a like Percentage Interest and Class to the above named assignee
and deliver such Certificate to the following address:
_______________________________________________________________________________.
Dated:
______________________________________
Signature by or on behalf of assignor
______________________________________
Signature Guaranteed
<PAGE>
DISTRIBUTION INSTRUCTIONS
The assignee should include the following for purposes of
distribution:
Distributions shall be made, by wire transfer or otherwise, in
immediately available funds to _________________________________________________
________________________________________________________________________________
for the account of _______________________________, account number ____________,
or, if mailed by check, to ____________________________________________________.
Applicable statements should be mailed to ______________________________________
This information is provided by _______________________________________________,
the assignee named above, or ____________________________________, as its agent.
<PAGE>
EXHIBIT A-2
[FORM OF CLASS A-1F CERTIFICATE]
ASSET BACKED FUNDING CERTIFICATES
SERIES 1999-1, CLASS A-1F
UNLESS THIS CERTIFICATE IS PRESENTED BY AN AUTHORIZED REPRESENTATIVE OF
THE DEPOSITORY TRUST COMPANY, A NEW YORK CORPORATION ("DTC"), TO THE
TRUSTEE OR ITS AGENT FOR REGISTRATION OF TRANSFER, EXCHANGE, OR PAYMENT,
AND ANY CERTIFICATE ISSUED IS REGISTERED IN THE NAME OF CEDE & CO. OR IN
SUCH OTHER NAME AS IS REQUESTED BY AN AUTHORIZED REPRESENTATIVE OF DTC
(AND ANY PAYMENT IS MADE TO CEDE & CO. OR TO SUCH OTHER ENTITY AS IS
REQUESTED BY AN AUTHORIZED REPRESENTATIVE OF DTC), ANY TRANSFER, PLEDGE,
OR OTHER USE HEREOF FOR VALUE OR OTHERWISE BY OR TO ANY PERSON IS WRONGFUL
INASMUCH AS THE REGISTERED OWNER HEREOF, CEDE & CO., HAS AN INTEREST
HEREIN.
SOLELY FOR U.S. FEDERAL INCOME TAX PURPOSES, THIS CERTIFICATE REPRESENTS
OWNERSHIP OF 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").
Series 1999-1, Class A-1F Original Class Certificate Principal
Balance of the Class A-1F Certificates
Pass-Through Rate: as of the Closing Date:
$
Date of Pooling and Servicing Agreement
and Cut-off Date: November 1, 1999 Denomination: $
First Distribution Date: December 27, Servicer: Litton Loan Servicing LP
1999
Trustee: The Chase Manhattan Bank
No.
Closing Date: December 21, 1999
CUSIP:
DISTRIBUTIONS IN REDUCTION OF THE CERTIFICATE PRINCIPAL BALANCE OF THIS
CERTIFICATE MAY BE MADE MONTHLY AS SET FORTH HEREIN. ACCORDINGLY, THE
OUTSTANDING CERTIFICATE PRINCIPAL BALANCE HEREOF AT ANY TIME MAY BE LESS
THAN THE AMOUNT SHOWN ABOVE.
ASSET BACKED FUNDING CERTIFICATE
evidencing a beneficial ownership interest in a portion of a Trust Fund
consisting primarily of a pool of conventional one- to four-family first
mortgage loans formed and sold by
ASSET BACKED FUNDING CORPORATION
THIS CERTIFICATE DOES NOT REPRESENT AN OBLIGATION OF OR INTEREST IN ASSET
BACKED FUNDING CORPORATION, THE SERVICER, THE TRUSTEE OR ANY OF THEIR
AFFILIATES. NEITHER THIS CERTIFICATE NOR THE UNDERLYING MORTGAGE LOANS ARE
GUARANTEED BY ANY AGENCY OR INSTRUMENTALITY OF THE UNITED STATES.
This certifies that ________________ is the registered owner of a
Percentage Interest (obtained by dividing the denomination of this Certificate
by the Original Class Certificate Principal Balance of the Class A-1F
Certificates) in that certain beneficial ownership interest evidenced by all the
Class A-1F Certificates in the Trust Fund created pursuant to a Pooling and
Servicing Agreement, dated as specified above (the "Agreement"), among Asset
Backed Funding Corporation (hereinafter called the "Depositor," which term
includes any successor entity under the Agreement), the Servicer and the
Trustee, a summary of certain of the pertinent provisions of which is set forth
hereafter. 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.
Pursuant to the terms of the Agreement, distributions 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 (a "Distribution Date"), commencing on the
first Distribution Date specified above, to the Person in whose name this
Certificate is registered on the last Business Day of the month immediately
preceding the month in which the related Distribution Date occurs or the Closing
Date, in the case of the first Distribution Date (the "Record Date"), from funds
in the Distribution Account in an amount equal to the product of the Percentage
Interest evidenced by this Certificate and the amount required to be distributed
to the Holders of Class A-1F Certificates on such Distribution Date pursuant to
the Agreement.
All distributions to the Holder of this Certificate under the
Agreement will be made or caused to be made by or on behalf of the Trustee by
wire transfer in immediately available funds to the account of the Person
entitled thereto if such Person shall have so notified the Trustee in writing at
least five Business Days prior to the Record Date immediately prior to such
Distribution Date and is the registered owner of Class A-1F Certificates the
aggregate initial Certificate Principal Balance of which is in excess of
$5,000,000, or by check mailed by first class mail to the address of the Person
entitled thereto, as such name and address shall appear on the Certificate
Register, provided that the Trustee may deduct a reasonable wire transfer fee
from any payment made by wire transfer. Notwithstanding the above, the final
distribution on this Certificate will be made after due notice by the Trustee of
the pendency of such distribution and only upon presentation and surrender of
this Certificate at the office or agency appointed by the Trustee for that
purpose as provided in the Agreement.
The Pass-Through Rate on the Class A-1F Certificates on each
Distribution Date will be the per annum rate specified above, plus on each
Distribution Date following the Optional Termination Date, 0.50% per annum.
Interest will accrue on the Class A-1F Certificates during each Interest Accrual
Period at a rate equal to the lesser of (i) the Class A-1F Pass Through Rate and
(ii) the applicable Maximum Rate for such Distribution Date.
This Certificate is one of a duly authorized issue of Certificates
designated as Asset Backed Funding Certificates of the Series specified on the
face hereof (herein called the "Certificates") and representing a Percentage
Interest in the Class A-1F Certificates.
The Class A-1F Certificates are limited in right of payment to
certain collections and recoveries respecting the Mortgage Loans, all as more
specifically set forth herein and in the Agreement. As provided in the
Agreement, withdrawals from the Collection Account and the Distribution Account
may be made from time to time for purposes other than distributions to
Certificateholders, such purposes including reimbursement of advances made, or
certain expenses incurred, with respect to the Mortgage Loans.
The Agreement permits, with certain exceptions therein provided, the
amendment thereof and the modification of the rights and obligations of the
Depositor, the Servicer, the Trustee and the rights of the Certificateholders
under the Agreement at any time by the Depositor, the Servicer and the Trustee
with the consent of the Holders of Certificates entitled to the Voting Rights
identified 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 herefor 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 upon surrender of this Certificate for registration of
transfer at the offices or agencies appointed by the Trustee as provided in the
Agreement, duly endorsed by, or accompanied by an assignment in the form below
or other 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 evidencing the same aggregate
Percentage Interest will be issued to the designated transferee or transferees.
The Certificates are issuable in fully registered form only without
coupons in Classes and denominations representing Percentage Interests 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 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 of Certificates, but the Trustee may require payment of a sum
sufficient to cover any tax or other governmental charge that may be imposed in
connection with any transfer or exchange of Certificates.
The Depositor, the Servicer, the Trustee and the Certificate
Registrar and any agent of the Depositor, the Servicer, the Trustee or the
Certificate Registrar may treat the Person in whose name this Certificate is
registered as the owner hereof for all purposes, and none of the Depositor, the
Servicer, the Trustee, the Certificate Registrar nor any such agent shall be
affected by notice to the contrary.
The obligations created by the Agreement and the Trust Fund created
thereby shall terminate upon payment to the Certificateholders of all amounts
held by or on behalf of the Trustee and required to be paid to them pursuant to
the Agreement following the earlier of (i) the final payment or other
liquidation (or any advance with respect thereto) of the last Mortgage Loan
remaining in the Trust Fund, and (ii) the purchase by the party designated in
the Agreement at a price determined as provided in the Agreement from the Trust
Fund of all Mortgage Loans and all property acquired in respect of such Mortgage
Loans. The Agreement permits, but does not require, the party designated in the
Agreement to purchase from the Trust Fund all Mortgage Loans and all property
acquired in respect of any Mortgage Loan at a price determined as provided in
the Agreement. The exercise of such right will effect early retirement of the
Certificates; however, such right to purchase is subject to the aggregate
Principal Balance of the Mortgage Loans at the time of purchase being 10% or
less of the Cut-off Date Aggregate Principal Balance.
The recitals contained herein shall be taken as statements of the
Depositor and the Trustee assumes no responsibility for their correctness.
Unless the certificate of authentication hereon has been executed by
the Certificate Registrar, by manual signature, this Certificate shall not be
entitled to any benefit under the Agreement or be valid for any purpose.
<PAGE>
IN WITNESS WHEREOF, the Trustee has caused this Certificate to be
duly executed.
Dated: December 21, 1999
THE CHASE MANHATTAN BANK, as Trustee
By:____________________________
Authorized Officer
CERTIFICATE OF AUTHENTICATION
This is one of the Class A-1F Certificates referred to in the
within-mentioned Agreement.
THE CHASE MANHATTAN BANK, as Certificate
Registrar
By:_______________________________
Authorized Signatory
Date of authentication: December 21, 1999
<PAGE>
ABBREVIATIONS
The following abbreviations, when used in the inscription on the face of this
instrument, shall be construed as though they were written out in full according
to applicable laws or regulations:
TEN COM - as tenants in common UNIF GIFT MIN ACT - Custodian
(Cust) (Minor)
TEN ENT - as tenants by the entireties under Uniform Gifts
to Minors Act
JT TEN - as joint tenants with right
if survivorship and not as ___________________
tenants in common (State)
Additional abbreviations may also be used though not in the above
list.
ASSIGNMENT
FOR VALUE RECEIVED, the undersigned hereby sell(s), assign(s) and
transfer(s) unto _______________________________________________________________
________________________________________________________________________________
(Please print or typewrite name, address including postal zip code, and Taxpayer
Identification Number of assignee)______________________________________________
________________________________________________________________________________
a Percentage Interest equal to ____% evidenced by the within asset-backed
Certificate and hereby authorize(s) the registration of transfer of such
interest to assignee on the Certificate Register of the Trust Fund.
I (we) further direct the Certificate Registrar to issue a new
Certificate of a like Percentage Interest and Class to the above named assignee
and deliver such Certificate to the following address:
_______________________________________________________________________________.
Dated:
______________________________________
Signature by or on behalf of assignor
______________________________________
Signature Guaranteed
<PAGE>
DISTRIBUTION INSTRUCTIONS
The assignee should include the following for purposes of
distribution:
Distributions shall be made, by wire transfer or otherwise, in
immediately available funds to _________________________________________________
________________________________________________________________________________
for the account of _______________________________, account number ____________,
or, if mailed by check, to ____________________________________________________.
Applicable statements should be mailed to ______________________________________
This information is provided by _______________________________________________,
the assignee named above, or ____________________________________, as its agent.
<PAGE>
EXHIBIT A-3
[FORM OF CLASS A-2F CERTIFICATE]
ASSET BACKED FUNDING CERTIFICATES
SERIES 1999-1, CLASS A-2F
UNLESS THIS CERTIFICATE IS PRESENTED BY AN AUTHORIZED REPRESENTATIVE OF
THE DEPOSITORY TRUST COMPANY, A NEW YORK CORPORATION ("DTC"), TO THE
TRUSTEE OR ITS AGENT FOR REGISTRATION OF TRANSFER, EXCHANGE, OR PAYMENT,
AND ANY CERTIFICATE ISSUED IS REGISTERED IN THE NAME OF CEDE & CO. OR IN
SUCH OTHER NAME AS IS REQUESTED BY AN AUTHORIZED REPRESENTATIVE OF DTC
(AND ANY PAYMENT IS MADE TO CEDE & CO. OR TO SUCH OTHER ENTITY AS IS
REQUESTED BY AN AUTHORIZED REPRESENTATIVE OF DTC), ANY TRANSFER, PLEDGE,
OR OTHER USE HEREOF FOR VALUE OR OTHERWISE BY OR TO ANY PERSON IS WRONGFUL
INASMUCH AS THE REGISTERED OWNER HEREOF, CEDE & CO., HAS AN INTEREST
HEREIN.
SOLELY FOR U.S. FEDERAL INCOME TAX PURPOSES, THIS CERTIFICATE REPRESENTS
OWNERSHIP OF 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").
Series 1999-1, Class A-2F Original Class Certificate Principal
Balance of the Class A-2F Certificates
Pass-Through Rate: as of the Closing Date:
$
Date of Pooling and Servicing Agreement
and Cut-off Date: November 1, 1999 Denomination: $
First Distribution Date: December 27, Servicer: Litton Loan Servicing LP
1999
Trustee: The Chase Manhattan Bank
No.
Closing Date: December 21, 1999
CUSIP:
DISTRIBUTIONS IN REDUCTION OF THE CERTIFICATE PRINCIPAL BALANCE OF THIS
CERTIFICATE MAY BE MADE MONTHLY AS SET FORTH HEREIN. ACCORDINGLY, THE
OUTSTANDING CERTIFICATE PRINCIPAL BALANCE HEREOF AT ANY TIME MAY BE LESS
THAN THE AMOUNT SHOWN ABOVE.
ASSET BACKED FUNDING CERTIFICATE
evidencing a beneficial ownership interest in a portion of a Trust Fund
consisting primarily of a pool of conventional one- to four-family first
mortgage loans formed and sold by
ASSET BACKED FUNDING CORPORATION
THIS CERTIFICATE DOES NOT REPRESENT AN OBLIGATION OF OR INTEREST IN ASSET
BACKED FUNDING CORPORATION, THE SERVICER, THE TRUSTEE OR ANY OF THEIR
AFFILIATES. NEITHER THIS CERTIFICATE NOR THE UNDERLYING MORTGAGE LOANS ARE
GUARANTEED BY ANY AGENCY OR INSTRUMENTALITY OF THE UNITED STATES.
This certifies that ___________________ is the registered owner of a
Percentage Interest (obtained by dividing the denomination of this Certificate
by the Original Class Certificate Principal Balance of the Class A-2F
Certificates) in that certain beneficial ownership interest evidenced by all the
Class A-2F Certificates in the Trust Fund created pursuant to a Pooling and
Servicing Agreement, dated as specified above (the "Agreement"), among Asset
Backed Funding Corporation (hereinafter called the "Depositor," which term
includes any successor entity under the Agreement), the Servicer and the
Trustee, a summary of certain of the pertinent provisions of which is set forth
hereafter. 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.
Pursuant to the terms of the Agreement, distributions 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 (a "Distribution Date"), commencing on the
first Distribution Date specified above, to the Person in whose name this
Certificate is registered on the last Business Day of the month immediately
preceding the month in which the related Distribution Date occurs or the Closing
Date, in the case of the first Distribution Date (the "Record Date"), from funds
in the Distribution Account in an amount equal to the product of the Percentage
Interest evidenced by this Certificate and the amount required to be distributed
to the Holders of Class A-2F Certificates on such Distribution Date pursuant to
the Agreement.
All distributions to the Holder of this Certificate under the
Agreement will be made or caused to be made by or on behalf of the Trustee by
wire transfer in immediately available funds to the account of the Person
entitled thereto if such Person shall have so notified the Trustee in writing at
least five Business Days prior to the Record Date immediately prior to such
Distribution Date and is the registered owner of Class A-2F Certificates the
aggregate initial Certificate Principal Balance of which is in excess of
$5,000,000, or by check mailed by first class mail to the address of the Person
entitled thereto, as such name and address shall appear on the Certificate
Register, provided that the Trustee may deduct a reasonable wire transfer fee
from any payment made by wire transfer. Notwithstanding the above, the final
distribution on this Certificate will be made after due notice by the Trustee of
the pendency of such distribution and only upon presentation and surrender of
this Certificate at the office or agency appointed by the Trustee for that
purpose as provided in the Agreement.
The Pass-Through Rate on the Class A-2F Certificates on each
Distribution Date will be the per annum rate specified above, plus on each
Distribution Date following the Optional Termination Date, 0.50% per annum.
Interest will accrue on the Class A-2F Certificates during each Interest Accrual
Period at a rate equal to the lesser of (i) the Class A-2F Pass Through Rate and
(ii) the applicable Maximum Rate for such Distribution Date.
This Certificate is one of a duly authorized issue of Certificates
designated as Asset Backed Funding Certificates of the Series specified on the
face hereof (herein called the "Certificates") and representing a Percentage
Interest in the Class A-2F Certificates.
The Class A-2F Certificates are limited in right of payment to
certain collections and recoveries respecting the Mortgage Loans, all as more
specifically set forth herein and in the Agreement. As provided in the
Agreement, withdrawals from the Collection Account and the Distribution Account
may be made from time to time for purposes other than distributions to
Certificateholders, such purposes including reimbursement of advances made, or
certain expenses incurred, with respect to the Mortgage Loans.
The Agreement permits, with certain exceptions therein provided, the
amendment thereof and the modification of the rights and obligations of the
Depositor, the Servicer, the Trustee and the rights of the Certificateholders
under the Agreement at any time by the Depositor, the Servicer and the Trustee
with the consent of the Holders of Certificates entitled to the Voting Rights
identified 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 herefor 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 upon surrender of this Certificate for registration of
transfer at the offices or agencies appointed by the Trustee as provided in the
Agreement, duly endorsed by, or accompanied by an assignment in the form below
or other 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 evidencing the same aggregate
Percentage Interest will be issued to the designated transferee or transferees.
The Certificates are issuable in fully registered form only without
coupons in Classes and denominations representing Percentage Interests 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 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 of Certificates, but the Trustee may require payment of a sum
sufficient to cover any tax or other governmental charge that may be imposed in
connection with any transfer or exchange of Certificates.
The Depositor, the Servicer, the Trustee and the Certificate
Registrar and any agent of the Depositor, the Servicer, the Trustee or the
Certificate Registrar may treat the Person in whose name this Certificate is
registered as the owner hereof for all purposes, and none of the Depositor, the
Servicer, the Trustee, the Certificate Registrar nor any such agent shall be
affected by notice to the contrary.
The obligations created by the Agreement and the Trust Fund created
thereby shall terminate upon payment to the Certificateholders of all amounts
held by or on behalf of the Trustee and required to be paid to them pursuant to
the Agreement following the earlier of (i) the final payment or other
liquidation (or any advance with respect thereto) of the last Mortgage Loan
remaining in the Trust Fund, and (ii) the purchase by the party designated in
the Agreement at a price determined as provided in the Agreement from the Trust
Fund of all Mortgage Loans and all property acquired in respect of such Mortgage
Loans. The Agreement permits, but does not require, the party designated in the
Agreement to purchase from the Trust Fund all Mortgage Loans and all property
acquired in respect of any Mortgage Loan at a price determined as provided in
the Agreement. The exercise of such right will effect early retirement of the
Certificates; however, such right to purchase is subject to the aggregate
Principal Balance of the Mortgage Loans at the time of purchase being 10% or
less of the Cut-off Date Aggregate Principal Balance.
The recitals contained herein shall be taken as statements of the
Depositor and the Trustee assumes no responsibility for their correctness.
Unless the certificate of authentication hereon has been executed by
the Certificate Registrar, by manual signature, this Certificate shall not be
entitled to any benefit under the Agreement or be valid for any purpose.
<PAGE>
IN WITNESS WHEREOF, the Trustee has caused this Certificate to be
duly executed.
Dated: December 21, 1999
THE CHASE MANHATTAN BANK, as Trustee
By:____________________________
Authorized Officer
CERTIFICATE OF AUTHENTICATION
This is one of the Class A-2F Certificates referred to in the
within-mentioned Agreement.
THE CHASE MANHATTAN BANK, as Certificate
Registrar
By:_______________________________
Authorized Signatory
Date of authentication: December 21, 1999
<PAGE>
ABBREVIATIONS
The following abbreviations, when used in the inscription on the face of this
instrument, shall be construed as though they were written out in full according
to applicable laws or regulations:
TEN COM - as tenants in common UNIF GIFT MIN ACT - Custodian
(Cust) (Minor)
TEN ENT - as tenants by the entireties under Uniform Gifts
to Minors Act
JT TEN - as joint tenants with right
if survivorship and not as ___________________
tenants in common (State)
Additional abbreviations may also be used though not in the above
list.
ASSIGNMENT
FOR VALUE RECEIVED, the undersigned hereby sell(s), assign(s) and
transfer(s) unto _______________________________________________________________
________________________________________________________________________________
(Please print or typewrite name, address including postal zip code, and Taxpayer
Identification Number of assignee)______________________________________________
________________________________________________________________________________
a Percentage Interest equal to ____% evidenced by the within asset-backed
Certificate and hereby authorize(s) the registration of transfer of such
interest to assignee on the Certificate Register of the Trust Fund.
I (we) further direct the Certificate Registrar to issue a new
Certificate of a like Percentage Interest and Class to the above named assignee
and deliver such Certificate to the following address:
_______________________________________________________________________________.
Dated:
______________________________________
Signature by or on behalf of assignor
______________________________________
Signature Guaranteed
<PAGE>
DISTRIBUTION INSTRUCTIONS
The assignee should include the following for purposes of
distribution:
Distributions shall be made, by wire transfer or otherwise, in
immediately available funds to _________________________________________________
________________________________________________________________________________
for the account of _______________________________, account number ____________,
or, if mailed by check, to ____________________________________________________.
Applicable statements should be mailed to ______________________________________
This information is provided by _______________________________________________,
the assignee named above, or ____________________________________, as its agent.
<PAGE>
EXHIBIT B
[FORM OF CLASS B CERTIFICATE]
ASSET BACKED FUNDING CERTIFICATES
SERIES 1999-1, CLASS B
UNLESS THIS CERTIFICATE IS PRESENTED BY AN AUTHORIZED REPRESENTATIVE OF
THE DEPOSITORY TRUST COMPANY, A NEW YORK CORPORATION ("DTC"), TO THE
TRUSTEE OR ITS AGENT FOR REGISTRATION OF TRANSFER, EXCHANGE, OR PAYMENT,
AND ANY CERTIFICATE ISSUED IS REGISTERED IN THE NAME OF CEDE & CO. OR 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.
THIS CERTIFICATE IS SUBORDINATED IN RIGHT OF PAYMENT TO THE CLASS A, CLASS
M-1 AND CLASS M-2 CERTIFICATES AS DESCRIBED IN THE POOLING AND SERVICING
AGREEMENT REFERRED TO HEREIN.
EXCEPT AS PROVIDED IN SECTION 5.02(D) OF THE POOLING AND SERVICING
AGREEMENT REFERRED TO HEREIN, THIS CERTIFICATE MAY NOT BE PURCHASED BY OR
TRANSFERRED TO ANY PERSON THAT HAS NOT DELIVERED A REPRESENTATION LETTER
STATING EITHER (A) THAT THE TRANSFEREE IS NOT AN EMPLOYEE BENEFIT PLAN OR
OTHER RETIREMENT ARRANGEMENT SUBJECT TO TITLE I OF THE EMPLOYEE RETIREMENT
INCOME SECURITY ACT OF 1974, AS AMENDED ("ERISA"), OR SECTION 4975 OF THE
INTERNAL REVENUE CODE OF 1986, AS AMENDED (THE "CODE"), OR A GOVERNMENTAL
PLAN, AS DEFINED IN SECTION 3(32) OF ERISA, SUBJECT TO ANY FEDERAL, STATE
OR LOCAL LAW WHICH IS, TO A MATERIAL EXTENT, SIMILAR TO THE FOREGOING
PROVISIONS OF ERISA OR THE CODE (COLLECTIVELY, A "PLAN"), AND IS NOT
ACTING ON BEHALF OF OR INVESTING THE ASSETS OF A PLAN OR (B) SUBJECT TO
CERTAIN CONDITIONS SET FORTH IN THE POOLING AND SERVICING AGREEMENT, THAT
THE SOURCE OF FUNDS USED TO PURCHASE THIS CERTIFICATE IS AN "INSURANCE
COMPANY GENERAL ACCOUNT." EACH PERSON WHO ACQUIRES THIS CERTIFICATE OR ANY
INTEREST THEREIN SHALL BE DEEMED TO HAVE MADE THE REPRESENTATIONS REQUIRED
BY THE REPRESENTATION LETTER REFERRED TO IN THE PRECEDING SENTENCE, UNLESS
SUCH PERSON SHALL HAVE PROVIDED SUCH REPRESENTATION LETTER REFERRED TO IN
THE PRECEDING SENTENCE TO THE TRUSTEE. THE POOLING AND SERVICING AGREEMENT
PROVIDES THAT ANY ATTEMPTED OR PURPORTED TRANSFER IN VIOLATION OF THESE
TRANSFER RESTRICTIONS WILL BE NULL AND VOID AND WILL VEST NO RIGHTS IN ANY
PURPORTED TRANSFEREE.
SOLELY FOR U.S. FEDERAL INCOME TAX PURPOSES, THIS CERTIFICATE REPRESENTS
OWNERSHIP OF 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").
Series 1999-1, Class B Original Class Certificate Principal
Balance of the Class B Certificates as
Pass-Through Rate: of the Closing Date:
$
Date of Pooling and Servicing Agreement
and Cut-off Date: November 1, 1999 Denomination: $
First Distribution Date: December 27, Servicer: Litton Loan Servicing LP
1999
Trustee: The Chase Manhattan Bank
No.
Closing Date: December 21, 1999
CUSIP:
DISTRIBUTIONS IN REDUCTION OF THE CERTIFICATE PRINCIPAL BALANCE OF THIS
CERTIFICATE MAY BE MADE MONTHLY AS SET FORTH HEREIN. ACCORDINGLY, THE
OUTSTANDING CERTIFICATE PRINCIPAL BALANCE HEREOF AT ANY TIME MAY BE LESS
THAN THE AMOUNT SHOWN ABOVE.
ASSET BACKED FUNDING CERTIFICATE
evidencing a beneficial ownership interest in a portion of a Trust Fund
consisting primarily of a pool of conventional one- to four-family first and
second mortgage loans formed and sold by
ASSET BACKED FUNDING CORPORATION
THIS CERTIFICATE DOES NOT REPRESENT AN OBLIGATION OF OR INTEREST IN ASSET
BACKED FUNDING CORPORATION, THE SERVICER, THE TRUSTEE OR ANY OF THEIR
AFFILIATES. NEITHER THIS CERTIFICATE NOR THE UNDERLYING MORTGAGE LOANS ARE
GUARANTEED BY ANY AGENCY OR INSTRUMENTALITY OF THE UNITED STATES.
This certifies that ________________ is the registered owner of a
Percentage Interest (obtained by dividing the denomination of this Certificate
by the Original Class Certificate Principal Balance of the Class B Certificates)
in that certain beneficial ownership interest evidenced by all the Class B
Certificates in the Trust Fund created pursuant to a Pooling and Servicing
Agreement, dated as specified above (the "Agreement"), among Asset Backed
Funding Corporation (hereinafter called the "Depositor," which term includes any
successor entity under the Agreement), the Servicer and the Trustee, a summary
of certain of the pertinent provisions of which is set forth hereafter. 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.
Pursuant to the terms of the Agreement, distributions 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 (a "Distribution Date"), commencing on the first
Distribution Date specified above, to the Person in whose name this Certificate
is registered on the last Business Day of the month immediately preceding the
month in which the related Distribution Date occurs or the Closing Date, in the
case of the first Distribution Date (the "Record Date"), from funds in the
Distribution Account in an amount equal to the product of the Percentage
Interest evidenced by this Certificate and the amount required to be distributed
to the Holders of Class B Certificates on such Distribution Date pursuant to the
Agreement.
All distributions to the Holder of this Certificate under the Agreement
will be made or caused to be made by or on behalf of the Trustee by wire
transfer in immediately available funds to the account of the Person entitled
thereto if such Person shall have so notified the Trustee in writing at least
five Business Days prior to the Record Date immediately prior to such
Distribution Date and is the registered owner of Class B Certificates the
aggregate initial Certificate Principal Balance of which is in excess of
$5,000,000, or by check mailed by first class mail to the address of the Person
entitled thereto, as such name and address shall appear on the Certificate
Register, provided that the Trustee may deduct a reasonable wire transfer fee
from any payment made by wire transfer. Notwithstanding the above, the final
distribution on this Certificate will be made after due notice by the Trustee of
the pendency of such distribution and only upon presentation and surrender of
this Certificate at the office or agency appointed by the Trustee for that
purpose as provided in the Agreement.
Interest will accrue on this Certificates during each Interest Accrual
Period at a rate equal to the lesser of (i) the per annum rate specified above
and (ii) the applicable Maximum Rate for such Distribution Date.
This Certificate is one of a duly authorized issue of Certificates
designated as Asset Backed Funding Certificates of the Series specified on the
face hereof (herein called the "Certificates") and representing a Percentage
Interest in the Class B Certificates.
The Class B Certificates are limited in right of payment to certain
collections and recoveries respecting the Mortgage Loans, all as more
specifically set forth herein and in the Agreement. As provided in the
Agreement, withdrawals from the Collection Account and the Distribution Account
may be made from time to time for purposes other than distributions to
Certificateholders, such purposes including reimbursement of advances made, or
certain expenses incurred, with respect to the Mortgage Loans.
This certificate is subordinated in right of payment to the Class A, Class
M-1 and Class M-2 Certificates as described in the Pooling and Servicing
Agreement referred to herein.
The Agreement permits, with certain exceptions therein provided, the
amendment thereof and the modification of the rights and obligations of the
Depositor, the Servicer, the Trustee and the rights of the Certificateholders
under the Agreement at any time by the Depositor, the Servicer and the Trustee
with the consent of the Holders of Certificates entitled to the Voting Rights
identified 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 herefor 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 upon surrender of this Certificate for registration of transfer at the
offices or agencies appointed by the Trustee as provided in the Agreement, duly
endorsed by, or accompanied by an assignment in the form below or other 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 evidencing the same aggregate Percentage
Interest will be issued to the designated transferee or transferees.
The Certificates are issuable in fully registered form only without
coupons in Classes and denominations representing Percentage Interests 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 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 of Certificates, but the Trustee may require payment of a sum
sufficient to cover any tax or other governmental charge that may be imposed in
connection with any transfer or exchange of Certificates.
The Depositor, the Servicer, the Trustee and the Certificate Registrar and
any agent of the Depositor, the Servicer, the Trustee or the Certificate
Registrar may treat the Person in whose name this Certificate is registered as
the owner hereof for all purposes, and none of the Depositor, the Servicer, the
Trustee, the Certificate Registrar nor any such agent shall be affected by
notice to the contrary.
The obligations created by the Agreement and the Trust Fund created
thereby shall terminate upon payment to the Certificateholders of all amounts
held by or on behalf of the Trustee and required to be paid to them pursuant to
the Agreement following the earlier of (i) the final payment or other
liquidation (or any advance with respect thereto) of the last Mortgage Loan
remaining in the Trust Fund, and (ii) the purchase by the party designated in
the Agreement at a price determined as provided in the Agreement from the Trust
Fund of all Mortgage Loans and all property acquired in respect of such Mortgage
Loans. The Agreement permits, but does not require, the party designated in the
Agreement to purchase from the Trust Fund all Mortgage Loans and all property
acquired in respect of any Mortgage Loan at a price determined as provided in
the Agreement. The exercise of such right will effect early retirement of the
Certificates; however, such right to purchase is subject to the aggregate
Principal Balance of the Mortgage Loans at the time of purchase being 10% or
less of the Cut-off Date Aggregate Principal Balance.
The recitals contained herein shall be taken as statements of the
Depositor and the Trustee assumes no responsibility for their correctness.
Unless the certificate of authentication hereon has been executed by the
Certificate Registrar, by manual signature, this Certificate shall not be
entitled to any benefit under the Agreement or be valid for any purpose.
<PAGE>
IN WITNESS WHEREOF, the Trustee has caused this Certificate to be duly
executed.
Dated: December 21, 1999
THE CHASE MANHATTAN BANK, as Trustee
By: ________________________________
Authorized Officer
CERTIFICATE OF AUTHENTICATION
This is one of the Class B Certificates referred to in the
within-mentioned Agreement.
THE CHASE MANHATTAN BANK, as Certificate
Registrar
By:___________________________
Authorized Signatory
Date of authentication: December 21, 1999
<PAGE>
ABBREVIATIONS
The following abbreviations, when used in the inscription on the face of this
instrument, shall be construed as though they were written out in full according
to applicable laws or regulations:
TEN COM - as tenants in common UNIF GIFT MIN ACT - Custodian
(Cust) (Minor)
TEN ENT - as tenants by the entireties under Uniform Gifts
to Minors Act
JT TEN - as joint tenants with right
if survivorship and not as ___________________
tenants in common (State)
Additional abbreviations may also be used though not in the above
list.
ASSIGNMENT
FOR VALUE RECEIVED, the undersigned hereby sell(s), assign(s) and
transfer(s) unto _______________________________________________________________
________________________________________________________________________________
(Please print or typewrite name, address including postal zip code, and Taxpayer
Identification Number of assignee)______________________________________________
________________________________________________________________________________
a Percentage Interest equal to ____% evidenced by the within asset-backed
Certificate and hereby authorize(s) the registration of transfer of such
interest to assignee on the Certificate Register of the Trust Fund.
I (we) further direct the Certificate Registrar to issue a new
Certificate of a like Percentage Interest and Class to the above named assignee
and deliver such Certificate to the following address:
_______________________________________________________________________________.
Dated:
______________________________________
Signature by or on behalf of assignor
______________________________________
Signature Guaranteed
<PAGE>
DISTRIBUTION INSTRUCTIONS
The assignee should include the following for purposes of
distribution:
Distributions shall be made, by wire transfer or otherwise, in
immediately available funds to _________________________________________________
________________________________________________________________________________
for the account of _______________________________, account number ____________,
or, if mailed by check, to ____________________________________________________.
Applicable statements should be mailed to ______________________________________
This information is provided by _______________________________________________,
the assignee named above, or ____________________________________, as its agent.
<PAGE>
EXHIBIT C-1
[FORM OF CLASS R CERTIFICATE]
ASSET BACKED FUNDING CERTIFICATES
SERIES 1999-1, CLASS R
THIS CERTIFICATE MAY NOT BE TRANSFERRED TO A NON-UNITED STATES PERSON.
SOLELY FOR U.S. FEDERAL INCOME TAX PURPOSES, THIS CERTIFICATE IS A
"RESIDUAL INTEREST" IN A "REAL ESTATE MORTGAGE INVESTMENT CONDUIT," AS
THOSE TERMS ARE DEFINED, RESPECTIVELY, IN SECTIONS 860G AND 860D OF THE
INTERNAL REVENUE CODE OF 1986, AS AMENDED (THE "CODE").
THIS CLASS R CERTIFICATE IS SUBORDINATE TO THE OFFERED CERTIFICATES OF
THIS SERIES TO THE EXTENT DESCRIBED HEREIN AND IN THE POOLING AND
SERVICING AGREEMENT REFERRED TO HEREIN.
THIS CLASS R CERTIFICATE WILL NOT BE ENTITLED TO PAYMENTS UNTIL SUCH TIME
AS DESCRIBED IN THE POOLING AND SERVICING AGREEMENT REFERRED TO HEREIN.
THIS CLASS R CERTIFICATE HAS NOT BEEN REGISTERED OR QUALIFIED UNDER THE
SECURITIES ACT OF 1933, AS AMENDED (THE "1933 ACT"), OR THE SECURITIES
LAWS OF ANY STATE. ANY RESALE, TRANSFER OR OTHER DISPOSITION OF THIS
CERTIFICATE WITHOUT SUCH REGISTRATION OR QUALIFICATION MAY BE MADE ONLY IN
A TRANSACTION THAT DOES NOT REQUIRE SUCH REGISTRATION OR QUALIFICATION AND
IN ACCORDANCE WITH THE PROVISIONS OF SECTION 5.02 OF THE POOLING AND
SERVICING AGREEMENT REFERRED TO HEREIN.
NO TRANSFER OF THIS CERTIFICATE TO AN EMPLOYEE BENEFIT PLAN OR OTHER
RETIREMENT ARRANGEMENT SUBJECT TO THE EMPLOYEE RETIREMENT INCOME SECURITY
ACT OF 1974, AS AMENDED, OR THE CODE WILL BE REGISTERED EXCEPT IN
COMPLIANCE WITH THE PROCEDURES DESCRIBED HEREIN.
ANY RESALE, TRANSFER OR OTHER DISPOSITION OF THIS CLASS R CERTIFICATE MAY
BE MADE ONLY IF THE PROPOSED TRANSFEREE PROVIDES (1) AN AFFIDAVIT TO THE
CERTIFICATE REGISTRAR AND THE TRUSTEE THAT SUCH TRANSFEREE IS NOT (A) THE
UNITED STATES, ANY STATE OR POLITICAL SUBDIVISION THEREOF, ANY FOREIGN
GOVERNMENT, ANY INTERNATIONAL ORGANIZATION, OR ANY AGENCY OR
INSTRUMENTALITY OF ANY OF THE FOREGOING, (B) ANY ORGANIZATION (OTHER THAN
A COOPERATIVE DESCRIBED IN SECTION 521 OF THE CODE) WHICH IS EXEMPT FROM
THE TAX IMPOSED BY CHAPTER 1 OF THE CODE UNLESS SUCH ORGANIZATION IS
SUBJECT TO THE TAX IMPOSED BY SECTION 511 OF THE CODE, (C) ANY
ORGANIZATION DESCRIBED IN SECTION 1381(A)(2)(C) OF THE CODE (ANY SUCH
PERSON DESCRIBED IN THE FOREGOING CLAUSES (A), (B) OR (C) BEING
HEREINAFTER REFERRED TO AS A "DISQUALIFIED ORGANIZATION"), OR (D) AN AGENT
OF A DISQUALIFIED ORGANIZATION AND (2) NO PURPOSE OF SUCH TRANSFER IS TO
IMPEDE THE ASSESSMENT OR COLLECTION OF TAX, AND (3) SUCH TRANSFEREE
SATISFIES CERTAIN ADDITIONAL CONDITIONS RELATING TO THE FINANCIAL
CONDITION OF THE PROPOSED TRANSFEREE. NOTWITHSTANDING THE REGISTRATION IN
THE CERTIFICATE REGISTER OR ANY TRANSFER, SALE OR OTHER DISPOSITION OF
THIS CLASS R CERTIFICATE TO A DISQUALIFIED ORGANIZATION OR AN AGENT OF A
DISQUALIFIED ORGANIZATION, SUCH REGISTRATION SHALL BE DEEMED TO BE OF NO
LEGAL FORCE OR EFFECT WHATSOEVER AND SUCH PERSON SHALL NOT BE DEEMED TO BE
A CERTIFICATEHOLDER FOR ANY PURPOSE HEREUNDER, INCLUDING, BUT NOT LIMITED
TO, THE RECEIPT OF DISTRIBUTIONS ON THIS CERTIFICATE. EACH HOLDER OF A
CLASS R CERTIFICATE BY ACCEPTANCE OF THIS CERTIFICATE SHALL BE DEEMED TO
HAVE CONSENTED TO THE PROVISIONS OF THIS PARAGRAPH AND THE PROVISIONS OF
SECTION 5.02(D) OF THE POOLING AND SERVICING AGREEMENT REFERRED TO HEREIN.
ANY PERSON THAT IS A DISQUALIFIED ORGANIZATION IS PROHIBITED FROM
ACQUIRING BENEFICIAL OWNERSHIP OF THIS CLASS R CERTIFICATE.
Series 1999-1, Class R Servicer: Litton Loan Servicing LP
Date of Pooling and Servicing Agreement Trustee: The Chase Manhattan Bank
and Cut-off Date: November 1, 1999
Closing Date: December 21, 1999
First Distribution Date: December 27,
1999
No.
Percentage Interest:
ASSET BACKED FUNDING CERTIFICATE
evidencing a beneficial ownership interest in a portion of a Trust Fund
consisting primarily of a pool of conventional one- to four-family first
mortgage loans formed and sold by
ASSET BACKED FUNDING CORPORATION
THIS CERTIFICATE DOES NOT REPRESENT AN OBLIGATION OF OR INTEREST IN ASSET
BACKED FUNDING CORPORATION, THE SERVICER, THE TRUSTEE OR ANY OF THEIR
AFFILIATES. NEITHER THIS CERTIFICATE NOR THE UNDERLYING MORTGAGE LOANS ARE
GUARANTEED BY ANY AGENCY OR INSTRUMENTALITY OF THE UNITED STATES.
This certifies that _______________________ is the registered owner
of a Percentage Interest set forth above in that certain beneficial ownership
interest evidenced by all the Class R Certificates in the Trust Fund created
pursuant to a Pooling and Servicing Agreement, dated as specified above (the
"Agreement"), among Asset Backed Funding Corporation (hereinafter called the
"Depositor," which term includes any successor entity under the Agreement), the
Servicer and the Trustee, a summary of certain of the pertinent provisions of
which is set forth hereafter. 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.
Pursuant to the terms of the Agreement, distributions 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 (a "Distribution Date"), commencing on the
first Distribution Date specified above, to the Person in whose name this
Certificate is registered on the last Business Day of the month immediately
preceding the month in which the related Distribution Date occurs or the Closing
Date, in the case of the first Distribution Date (the "Record Date"), from funds
in the Distribution Account in an amount equal to the product of the Percentage
Interest evidenced by this Certificate and the amount required to be distributed
to the Holders of Class R Certificates on such Distribution Date pursuant to the
Agreement.
All distributions to the Holder of this Certificate under the
Agreement will be made or caused to be made by or on behalf of the Trustee by
wire transfer in immediately available funds to the account of the Person
entitled thereto if such Person shall have so notified the Trustee in writing at
least five Business Days prior to the Record Date immediately prior to such
Distribution Date and is the registered owner of Class R Certificates the
aggregate Percentage Interest of which is in excess of a 66% Percentage Interest
of the Class R Certificates, or by check mailed by first class mail to the
address of the Person entitled thereto, as such name and address shall appear on
the Certificate Register, provided that the Trustee may deduct a reasonable wire
transfer fee from any payment made by wire transfer. Notwithstanding the above,
the final distribution on this Certificate will be made after due notice by the
Trustee of the pendency of such distribution and only upon presentation and
surrender of this Certificate at the office or agency appointed by the Trustee
for that purpose as provided in the Agreement.
This Certificate is one of a duly authorized issue of Certificates
designated as Asset Backed Funding Certificates of the Series specified on the
face hereof (herein called the "Certificates") and representing the Percentage
Interest specified on the face hereof.
The Class R Certificates are limited in right of payment to certain
collections and recoveries respecting the Mortgage Loans, all as more
specifically set forth herein and in the Agreement. As provided in the
Agreement, withdrawals from the Collection Account and the Distribution Account
may be made from time to time for purposes other than distributions to
Certificateholders, such purposes including reimbursement of advances made, or
certain expenses incurred, with respect to the Mortgage Loans.
The Agreement permits, with certain exceptions therein provided, the
amendment thereof and the modification of the rights and obligations of the
Depositor, the Servicer, the Trustee and the rights of the Certificateholders
under the Agreement at any time by the Depositor, the Servicer and the Trustee
with the consent of the Holders of Certificates entitled to the Voting Rights
identified 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 herefor 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 upon surrender of this Certificate for registration of
transfer at the offices or agencies appointed by the Trustee as provided in the
Agreement, duly endorsed by, or accompanied by an assignment in the form below
or other 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 evidencing the same aggregate
Percentage Interest will be issued to the designated transferee or transferees.
The Certificates are issuable in fully registered form only without
coupons in Classes and denominations representing Percentage Interests 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 evidencing the same
aggregate Percentage Interest, as requested by the Holder surrendering the same.
No transfer of this Certificate shall be made unless that transfer
is made pursuant to an effective registration statement under the 1933 Act and
effective registration or qualification under applicable state securities laws,
or is made in a transaction that does not require such registration or
qualification. In the event that a transfer is to be made without registration
or qualification, the Trustee and the Certificate Registrar shall require, in
order to assure compliance with such laws, either (i) that the Certificateholder
desiring to effect the transfer and such Certificateholder's prospective
transferee each execute a representation letter in the form described by the
Agreement certifying to the Trustee and the Certificate Registrar the facts
surrounding the transfer, or (ii) that the Trustee and the Certificate Registrar
shall require an Opinion of Counsel satisfactory to them that such transfer may
be made without such registration or qualification, which Opinion of Counsel
shall not be an expense of the Depositor, the Trustee or the Certificate
Registrar, in their respective capacities as such. None of the Depositor, the
Certificate Registrar nor the Trustee is obligated to register or qualify the
Class of Certificates specified on the face hereof under the 1933 Act or any
other securities law or to take any action not otherwise required under the
Agreement to permit the transfer of such Certificates without registration or
qualification. Any such Certificateholder desiring to effect such transfer
shall, and does hereby agree to, indemnify the Trustee, the Depositor, the
Certificate Registrar and any Servicer against any liability that may result if
the transfer is not so exempt or is not made in accordance with such federal and
state laws.
Except as otherwise set forth in the next succeeding paragraph, no
transfer of a Certificate or any interest therein may be made to employee
benefit plans and certain other retirement plans and arrangements, including
individual retirement accounts and annuities, Keogh plans and collective
investment funds and separate accounts in which such plans, accounts or
arrangements are invested that are subject to the fiduciary responsibility
provisions of ERISA and Section 4975 of the Code ("Plans") or any person who is
directly or indirectly purchasing the Certificate or interest therein on behalf
of, as named fiduciary of, as trustee of, or with assets of a Plan, unless the
prospective transferee provides the Trustee with an opinion of counsel which
establish to the satisfaction of the Trustee that such transfer will not result
in a violation of Section 406 of ERISA or Section 4975 of the Code or cause the
Servicer or Trustee to be deemed a fiduciary of such Plan or result in the
imposition of an excise tax under Section 4975 of the Code. In the absence of
its having received the opinion of counsel contemplated by the preceding
sentence, the Trustee shall require the prospective transferee of any
Certificate to certify that it is neither (i) a Plan nor (ii) a Person who is
directly or indirectly purchasing such Certificate on behalf of, as named
fiduciary of, as trustee of, or with assets of a Plan (including any insurance
company using funds in its general or separate accounts that may constitute
"plan assets").
The Holder of this Certificate, by its acceptance hereof, shall be
deemed for all purposes to have consented to the provisions of Section 5.02 of
the Agreement and to any amendment of the Agreement deemed necessary by counsel
of the Depositor to ensure that the transfer of this Certificate to any Person
other than a Permitted Transferee or any other Person will not cause the Trust
to cease to qualify as a REMIC or cause the imposition of a tax upon the Trust.
No service charge will be made for any such registration of transfer
or exchange of Certificates, but the Trustee may require payment of a sum
sufficient to cover any tax or other governmental charge that may be imposed in
connection with any transfer or exchange of Certificates.
The Depositor, the Servicer, the Trustee and the Certificate
Registrar and any agent of the Depositor, the Servicer, the Trustee or the
Certificate Registrar may treat the Person in whose name this Certificate is
registered as the owner hereof for all purposes, and none of the Depositor, the
Servicer, the Trustee, the Certificate Registrar nor any such agent shall be
affected by notice to the contrary.
The obligations created by the Agreement and the Trust Fund created
thereby shall terminate upon payment to the Certificateholders of all amounts
held by or on behalf of the Trustee and required to be paid to them pursuant to
the Agreement following the earlier of (i) the final payment or other
liquidation (or any advance with respect thereto) of the last Mortgage Loan
remaining in the Trust Fund, and (ii) the purchase by the party designated in
the Agreement at a price determined as provided in the Agreement from the Trust
Fund of all Mortgage Loans and all property acquired in respect of such Mortgage
Loans. The Agreement permits, but does not require, the party designated in the
Agreement to purchase from the Trust Fund all Mortgage Loans and all property
acquired in respect of any Mortgage Loan at a price determined as provided in
the Agreement. The exercise of such right will effect early retirement of the
Certificates; however, such right to purchase is subject to the aggregate
Principal Balance of the Mortgage Loans at the time of purchase being 10% or
less of the Cut-off Date Aggregate Principal Balance.
The recitals contained herein shall be taken as statements of the
Depositor and the Trustee assumes no responsibility for their correctness.
Unless the certificate of authentication hereon has been executed by
the Certificate Registrar, by manual signature, this Certificate shall not be
entitled to any benefit under the Agreement or be valid for any purpose.
<PAGE>
IN WITNESS WHEREOF, the Trustee has caused this Certificate to be
duly executed.
Dated: December 21, 1999
THE CHASE MANHATTAN BANK, as Trustee
By: ________________________________
Authorized Officer
CERTIFICATE OF AUTHENTICATION
This is one of the Class R Certificates referred to in the
within-mentioned Agreement.
Dated: December 21, 1999
THE CHASE MANHATTAN BANK, as Certificate
Registrar
By: ________________________________
Authorized Signatory
<PAGE>
ABBREVIATIONS
The following abbreviations, when used in the inscription on the face of this
instrument, shall be construed as though they were written out in full according
to applicable laws or regulations:
TEN COM - as tenants in common UNIF GIFT MIN ACT - Custodian
(Cust) (Minor)
TEN ENT - as tenants by the entireties under Uniform Gifts
to Minors Act
JT TEN - as joint tenants with right
if survivorship and not as ___________________
tenants in common (State)
Additional abbreviations may also be used though not in the above
list.
ASSIGNMENT
FOR VALUE RECEIVED, the undersigned hereby sell(s), assign(s) and
transfer(s) unto _______________________________________________________________
________________________________________________________________________________
(Please print or typewrite name, address including postal zip code, and Taxpayer
Identification Number of assignee)______________________________________________
________________________________________________________________________________
a Percentage Interest equal to ____% evidenced by the within asset-backed
Certificate and hereby authorize(s) the registration of transfer of such
interest to assignee on the Certificate Register of the Trust Fund.
I (we) further direct the Certificate Registrar to issue a new
Certificate of a like Percentage Interest and Class to the above named assignee
and deliver such Certificate to the following address:
_______________________________________________________________________________.
Dated:
______________________________________
Signature by or on behalf of assignor
______________________________________
Signature Guaranteed
<PAGE>
DISTRIBUTION INSTRUCTIONS
The assignee should include the following for purposes of
distribution:
Distributions shall be made, by wire transfer or otherwise, in
immediately available funds to _________________________________________________
________________________________________________________________________________
for the account of _______________________________, account number ____________,
or, if mailed by check, to ____________________________________________________.
Applicable statements should be mailed to ______________________________________
This information is provided by _______________________________________________,
the assignee named above, or ____________________________________, as its agent.
<PAGE>
EXHIBIT C-2
[FORM OF CLASS M-1 CERTIFICATE]
ASSET BACKED FUNDING CERTIFICATES
SERIES 1999-1, CLASS M-1
UNLESS THIS CERTIFICATE IS PRESENTED BY AN AUTHORIZED REPRESENTATIVE OF
THE DEPOSITORY TRUST COMPANY, A NEW YORK CORPORATION ("DTC"), TO THE
TRUSTEE OR ITS AGENT FOR REGISTRATION OF TRANSFER, EXCHANGE, OR PAYMENT,
AND ANY CERTIFICATE ISSUED IS REGISTERED IN THE NAME OF CEDE & CO. OR 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.
THIS CERTIFICATE IS SUBORDINATED IN RIGHT OF PAYMENT TO THE CLASS A
CERTIFICATES AS DESCRIBED IN THE POOLING AND SERVICING AGREEMENT REFERRED
TO HEREIN.
EXCEPT AS PROVIDED IN SECTION 5.02(D) OF THE POOLING AND SERVICING
AGREEMENT REFERRED TO HEREIN, THIS CERTIFICATE MAY NOT BE PURCHASED BY OR
TRANSFERRED TO ANY PERSON THAT HAS NOT DELIVERED A REPRESENTATION LETTER
STATING EITHER (A) THAT THE TRANSFEREE IS NOT AN EMPLOYEE BENEFIT PLAN OR
OTHER RETIREMENT ARRANGEMENT SUBJECT TO TITLE I OF THE EMPLOYEE RETIREMENT
INCOME SECURITY ACT OF 1974, AS AMENDED ("ERISA"), OR SECTION 4975 OF THE
INTERNAL REVENUE CODE OF 1986, AS AMENDED (THE "CODE"), OR A GOVERNMENTAL
PLAN, AS DEFINED IN SECTION 3(32) OF ERISA, SUBJECT TO ANY FEDERAL, STATE
OR LOCAL LAW WHICH IS, TO A MATERIAL EXTENT, SIMILAR TO THE FOREGOING
PROVISIONS OF ERISA OR THE CODE (COLLECTIVELY, A "PLAN"), AND IS NOT
ACTING ON BEHALF OF OR INVESTING THE ASSETS OF A PLAN OR (B) SUBJECT TO
CERTAIN CONDITIONS SET FORTH IN THE POOLING AND SERVICING AGREEMENT, THAT
THE SOURCE OF FUNDS USED TO PURCHASE THIS CERTIFICATE IS AN "INSURANCE
COMPANY GENERAL ACCOUNT." EACH PERSON WHO ACQUIRES THIS CERTIFICATE OR ANY
INTEREST THEREIN SHALL BE DEEMED TO HAVE MADE THE REPRESENTATIONS REQUIRED
BY THE REPRESENTATION LETTER REFERRED TO IN THE PRECEDING SENTENCE, UNLESS
SUCH PERSON SHALL HAVE PROVIDED SUCH REPRESENTATION LETTER REFERRED TO IN
THE PRECEDING SENTENCE TO THE TRUSTEE. THE POOLING AND SERVICING AGREEMENT
PROVIDES THAT ANY ATTEMPTED OR PURPORTED TRANSFER IN VIOLATION OF THESE
TRANSFER RESTRICTIONS WILL BE NULL AND VOID AND WILL VEST NO RIGHTS IN ANY
PURPORTED TRANSFEREE.
SOLELY FOR U.S. FEDERAL INCOME TAX PURPOSES, THIS CERTIFICATE REPRESENTS
OWNERSHIP OF 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").
Series 1999-1, Class M-1 Original Class Certificate Principal
Balance of the Class M-1 Certificates
Pass-Through Rate: as of the Closing Date:
$
Date of Pooling and Servicing Agreement
and Cut-off Date: November 1, 1999 Denomination: $
First Distribution Date: December 27, Servicer: Litton Loan Servicing LP
1999
Trustee: The Chase Manhattan Bank
No.
Closing Date: December 21, 1999
CUSIP:
DISTRIBUTIONS IN REDUCTION OF THE CERTIFICATE PRINCIPAL BALANCE OF THIS
CERTIFICATE MAY BE MADE MONTHLY AS SET FORTH HEREIN. ACCORDINGLY, THE
OUTSTANDING CERTIFICATE PRINCIPAL BALANCE HEREOF AT ANY TIME MAY BE LESS
THAN THE AMOUNT SHOWN ABOVE.
ASSET BACKED FUNDING CERTIFICATE
evidencing a beneficial ownership interest in a portion of a Trust Fund
consisting primarily of a pool of conventional one- to four-family first and
second mortgage loans formed and sold by
ASSET BACKED FUNDING CORPORATION
THIS CERTIFICATE DOES NOT REPRESENT AN OBLIGATION OF OR INTEREST IN ASSET
BACKED FUNDING CORPORATION, THE SERVICER, THE TRUSTEE OR ANY OF THEIR
AFFILIATES. NEITHER THIS CERTIFICATE NOR THE UNDERLYING MORTGAGE LOANS ARE
GUARANTEED BY ANY AGENCY OR INSTRUMENTALITY OF THE UNITED STATES.
This certifies that _________________ is the registered owner of a
Percentage Interest (obtained by dividing the denomination of this Certificate
by the Original Class Certificate Principal Balance of the Class M-1
Certificates) in that certain beneficial ownership interest evidenced by all the
Class M-1 Certificates in the Trust Fund created pursuant to a Pooling and
Servicing Agreement, dated as specified above (the "Agreement"), among Asset
Backed Funding Corporation (hereinafter called the "Depositor," which term
includes any successor entity under the Agreement), the Servicer and the
Trustee, a summary of certain of the pertinent provisions of which is set forth
hereafter. 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.
Pursuant to the terms of the Agreement, distributions 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 (a "Distribution Date"), commencing on the first
Distribution Date specified above, to the Person in whose name this Certificate
is registered on the last Business Day of the month immediately preceding the
month in which the related Distribution Date occurs or the Closing Date, in the
case of the first Distribution Date (the "Record Date"), from funds in the
Distribution Account in an amount equal to the product of the Percentage
Interest evidenced by this Certificate and the amount required to be distributed
to the Holders of Class M-1 Certificates on such Distribution Date pursuant to
the Agreement.
All distributions to the Holder of this Certificate under the Agreement
will be made or caused to be made by or on behalf of the Trustee by wire
transfer in immediately available funds to the account of the Person entitled
thereto if such Person shall have so notified the Trustee in writing at least
five Business Days prior to the Record Date immediately prior to such
Distribution Date and is the registered owner of Class M-1 Certificates the
aggregate initial Certificate Principal Balance of which is in excess of
$5,000,000, or by check mailed by first class mail to the address of the Person
entitled thereto, as such name and address shall appear on the Certificate
Register, provided that the Trustee may deduct a reasonable wire transfer fee
from any payment made by wire transfer. Notwithstanding the above, the final
distribution on this Certificate will be made after due notice by the Trustee of
the pendency of such distribution and only upon presentation and surrender of
this Certificate at the office or agency appointed by the Trustee for that
purpose as provided in the Agreement.
Interest will accrue on this Certificates during each Interest Accrual
Period at a rate equal to the lesser of (i) the per annum rate specified above
and (ii) the applicable Maximum Rate for such Distribution Date.
This Certificate is one of a duly authorized issue of Certificates
designated as Asset Backed Funding Certificates of the Series specified on the
face hereof (herein called the "Certificates") and representing a Percentage
Interest in the Class M-1 Certificates.
The Class M-1 Certificates are limited in right of payment to certain
collections and recoveries respecting the Mortgage Loans, all as more
specifically set forth herein and in the Agreement. As provided in the
Agreement, withdrawals from the Collection Account and the Distribution Account
may be made from time to time for purposes other than distributions to
Certificateholders, such purposes including reimbursement of advances made, or
certain expenses incurred, with respect to the Mortgage Loans.
This certificate is subordinated in right of payment to the Class A
Certificates as described in the Pooling and Servicing Agreement referred to
herein.
The Agreement permits, with certain exceptions therein provided, the
amendment thereof and the modification of the rights and obligations of the
Depositor, the Servicer, the Trustee and the rights of the Certificateholders
under the Agreement at any time by the Depositor, the Servicer and the Trustee
with the consent of the Holders of Certificates entitled to the Voting Rights
identified 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 herefor 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 upon surrender of this Certificate for registration of transfer at the
offices or agencies appointed by the Trustee as provided in the Agreement, duly
endorsed by, or accompanied by an assignment in the form below or other 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 evidencing the same aggregate Percentage
Interest will be issued to the designated transferee or transferees.
The Certificates are issuable in fully registered form only without
coupons in Classes and denominations representing Percentage Interests 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 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 of Certificates, but the Trustee may require payment of a sum
sufficient to cover any tax or other governmental charge that may be imposed in
connection with any transfer or exchange of Certificates.
The Depositor, the Servicer, the Trustee and the Certificate Registrar and
any agent of the Depositor, the Servicer, the Trustee or the Certificate
Registrar may treat the Person in whose name this Certificate is registered as
the owner hereof for all purposes, and none of the Depositor, the Servicer, the
Trustee, the Certificate Registrar nor any such agent shall be affected by
notice to the contrary.
The obligations created by the Agreement and the Trust Fund created
thereby shall terminate upon payment to the Certificateholders of all amounts
held by or on behalf of the Trustee and required to be paid to them pursuant to
the Agreement following the earlier of (i) the final payment or other
liquidation (or any advance with respect thereto) of the last Mortgage Loan
remaining in the Trust Fund, and (ii) the purchase by the party designated in
the Agreement at a price determined as provided in the Agreement from the Trust
Fund of all Mortgage Loans and all property acquired in respect of such Mortgage
Loans. The Agreement permits, but does not require, the party designated in the
Agreement to purchase from the Trust Fund all Mortgage Loans and all property
acquired in respect of any Mortgage Loan at a price determined as provided in
the Agreement. The exercise of such right will effect early retirement of the
Certificates; however, such right to purchase is subject to the aggregate
Principal Balance of the Mortgage Loans at the time of purchase being 10% or
less of the Cut-off Date Aggregate Principal Balance.
The recitals contained herein shall be taken as statements of the
Depositor and the Trustee assumes no responsibility for their correctness.
Unless the certificate of authentication hereon has been executed by the
Certificate Registrar, by manual signature, this Certificate shall not be
entitled to any benefit under the Agreement or be valid for any purpose.
<PAGE>
IN WITNESS WHEREOF, the Trustee has caused this Certificate to be duly
executed.
Dated: December 21, 1999
THE CHASE MANHATTAN BANK, as Trustee
By:_________________________________
Authorized Officer
CERTIFICATE OF AUTHENTICATION
This is one of the Class M-1 Certificates referred to in the
within-mentioned Agreement.
THE CHASE MANHATTAN BANK, as Certificate
Registrar
By:______________________________________
Authorized Signatory
Date of authentication: December 21, 1999
<PAGE>
ABBREVIATIONS
The following abbreviations, when used in the inscription on the face of this
instrument, shall be construed as though they were written out in full according
to applicable laws or regulations:
TEN COM - as tenants in common UNIF GIFT MIN ACT - Custodian
(Cust) (Minor)
TEN ENT - as tenants by the entireties under Uniform Gifts
to Minors Act
JT TEN - as joint tenants with right
if survivorship and not as ___________________
tenants in common (State)
Additional abbreviations may also be used though not in the above
list.
ASSIGNMENT
FOR VALUE RECEIVED, the undersigned hereby sell(s), assign(s) and
transfer(s) unto _______________________________________________________________
________________________________________________________________________________
(Please print or typewrite name, address including postal zip code, and Taxpayer
Identification Number of assignee)______________________________________________
________________________________________________________________________________
a Percentage Interest equal to ____% evidenced by the within asset-backed
Certificate and hereby authorize(s) the registration of transfer of such
interest to assignee on the Certificate Register of the Trust Fund.
I (we) further direct the Certificate Registrar to issue a new
Certificate of a like Percentage Interest and Class to the above named assignee
and deliver such Certificate to the following address:
_______________________________________________________________________________.
Dated:
______________________________________
Signature by or on behalf of assignor
______________________________________
Signature Guaranteed
<PAGE>
DISTRIBUTION INSTRUCTIONS
The assignee should include the following for purposes of
distribution:
Distributions shall be made, by wire transfer or otherwise, in
immediately available funds to _________________________________________________
________________________________________________________________________________
for the account of _______________________________, account number ____________,
or, if mailed by check, to ____________________________________________________.
Applicable statements should be mailed to ______________________________________
This information is provided by _______________________________________________,
the assignee named above, or ____________________________________, as its agent.
<PAGE>
EXHIBIT C-3
[FORM OF CLASS M-2 CERTIFICATE]
ASSET BACKED FUNDING CERTIFICATES
SERIES 1999-1, CLASS M-2
UNLESS THIS CERTIFICATE IS PRESENTED BY AN AUTHORIZED REPRESENTATIVE OF
THE DEPOSITORY TRUST COMPANY, A NEW YORK CORPORATION ("DTC"), TO THE
TRUSTEE OR ITS AGENT FOR REGISTRATION OF TRANSFER, EXCHANGE, OR PAYMENT,
AND ANY CERTIFICATE ISSUED IS REGISTERED IN THE NAME OF CEDE & CO. OR 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.
THIS CERTIFICATE IS SUBORDINATED IN RIGHT OF PAYMENT TO THE CLASS A AND
CLASS M-1 CERTIFICATES AS DESCRIBED IN THE POOLING AND SERVICING AGREEMENT
REFERRED TO HEREIN.
EXCEPT AS PROVIDED IN SECTION 5.02(D) OF THE POOLING AND SERVICING
AGREEMENT REFERRED TO HEREIN, THIS CERTIFICATE MAY NOT BE PURCHASED BY OR
TRANSFERRED TO ANY PERSON THAT HAS NOT DELIVERED A REPRESENTATION LETTER
STATING EITHER (A) THAT THE TRANSFEREE IS NOT AN EMPLOYEE BENEFIT PLAN OR
OTHER RETIREMENT ARRANGEMENT SUBJECT TO TITLE I OF THE EMPLOYEE RETIREMENT
INCOME SECURITY ACT OF 1974, AS AMENDED ("ERISA"), OR SECTION 4975 OF THE
INTERNAL REVENUE CODE OF 1986, AS AMENDED (THE "CODE"), OR A GOVERNMENTAL
PLAN, AS DEFINED IN SECTION 3(32) OF ERISA, SUBJECT TO ANY FEDERAL, STATE
OR LOCAL LAW WHICH IS, TO A MATERIAL EXTENT, SIMILAR TO THE FOREGOING
PROVISIONS OF ERISA OR THE CODE (COLLECTIVELY, A "PLAN"), AND IS NOT
ACTING ON BEHALF OF OR INVESTING THE ASSETS OF A PLAN OR (B) SUBJECT TO
CERTAIN CONDITIONS SET FORTH IN THE POOLING AND SERVICING AGREEMENT, THAT
THE SOURCE OF FUNDS USED TO PURCHASE THIS CERTIFICATE IS AN "INSURANCE
COMPANY GENERAL ACCOUNT." EACH PERSON WHO ACQUIRES THIS CERTIFICATE OR ANY
INTEREST THEREIN SHALL BE DEEMED TO HAVE MADE THE REPRESENTATIONS REQUIRED
BY THE REPRESENTATION LETTER REFERRED TO IN THE PRECEDING SENTENCE, UNLESS
SUCH PERSON SHALL HAVE PROVIDED SUCH REPRESENTATION LETTER REFERRED TO IN
THE PRECEDING SENTENCE TO THE TRUSTEE. THE POOLING AND SERVICING AGREEMENT
PROVIDES THAT ANY ATTEMPTED OR PURPORTED TRANSFER IN VIOLATION OF THESE
TRANSFER RESTRICTIONS WILL BE NULL AND VOID AND WILL VEST NO RIGHTS IN ANY
PURPORTED TRANSFEREE.
SOLELY FOR U.S. FEDERAL INCOME TAX PURPOSES, THIS CERTIFICATE REPRESENTS
OWNERSHIP OF 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").
Series 1999-1, Class M-2 Original Class Certificate Principal
Balance of the Class M-2 Certificates
Pass-Through Rate: as of the Closing Date:
$
Date of Pooling and Servicing Agreement
and Cut-off Date: November 1, 1999 Denomination: $
First Distribution Date: December 27, Servicer: Litton Loan Servicing LP
1999
Trustee: The Chase Manhattan Bank
No.
Closing Date: December 21, 1999
CUSIP:
DISTRIBUTIONS IN REDUCTION OF THE CERTIFICATE PRINCIPAL BALANCE OF THIS
CERTIFICATE MAY BE MADE MONTHLY AS SET FORTH HEREIN. ACCORDINGLY, THE
OUTSTANDING CERTIFICATE PRINCIPAL BALANCE HEREOF AT ANY TIME MAY BE LESS
THAN THE AMOUNT SHOWN ABOVE.
ASSET BACKED FUNDING CERTIFICATE
evidencing a beneficial ownership interest in a portion of a Trust Fund
consisting primarily of a pool of conventional one- to four-family first and
second mortgage loans formed and sold by
ASSET BACKED FUNDING CORPORATION
THIS CERTIFICATE DOES NOT REPRESENT AN OBLIGATION OF OR INTEREST IN ASSET
BACKED FUNDING CORPORATION, THE SERVICER, THE TRUSTEE OR ANY OF THEIR
AFFILIATES. NEITHER THIS CERTIFICATE NOR THE UNDERLYING MORTGAGE LOANS ARE
GUARANTEED BY ANY AGENCY OR INSTRUMENTALITY OF THE UNITED STATES.
This certifies that _____________ is the registered owner of a Percentage
Interest (obtained by dividing the denomination of this Certificate by the
Original Class Certificate Principal Balance of the Class M-2 Certificates) in
that certain beneficial ownership interest evidenced by all the Class M-2
Certificates in the Trust Fund created pursuant to a Pooling and Servicing
Agreement, dated as specified above (the "Agreement"), among Asset Backed
Funding Corporation (hereinafter called the "Depositor," which term includes any
successor entity under the Agreement), the Servicer and the Trustee, a summary
of certain of the pertinent provisions of which is set forth hereafter. 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.
Pursuant to the terms of the Agreement, distributions 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 (a "Distribution Date"), commencing on the first
Distribution Date specified above, to the Person in whose name this Certificate
is registered on the last Business Day of the month immediately preceding the
month in which the related Distribution Date occurs or the Closing Date, in the
case of the first Distribution Date (the "Record Date"), from funds in the
Distribution Account in an amount equal to the product of the Percentage
Interest evidenced by this Certificate and the amount required to be distributed
to the Holders of Class M-2 Certificates on such Distribution Date pursuant to
the Agreement.
All distributions to the Holder of this Certificate under the Agreement
will be made or caused to be made by or on behalf of the Trustee by wire
transfer in immediately available funds to the account of the Person entitled
thereto if such Person shall have so notified the Trustee in writing at least
five Business Days prior to the Record Date immediately prior to such
Distribution Date and is the registered owner of Class M-2 Certificates the
aggregate initial Certificate Principal Balance of which is in excess of
$5,000,000, or by check mailed by first class mail to the address of the Person
entitled thereto, as such name and address shall appear on the Certificate
Register, provided that the Trustee may deduct a reasonable wire transfer fee
from any payment made by wire transfer. Notwithstanding the above, the final
distribution on this Certificate will be made after due notice by the Trustee of
the pendency of such distribution and only upon presentation and surrender of
this Certificate at the office or agency appointed by the Trustee for that
purpose as provided in the Agreement.
Interest will accrue on this Certificates during each Interest Accrual
Period at a rate equal to the lesser of (i) the per annum rate specified above
and (ii) the applicable Maximum Rate for such Distribution Date.
This Certificate is one of a duly authorized issue of Certificates
designated as Asset Backed Funding Certificates of the Series specified on the
face hereof (herein called the "Certificates") and representing a Percentage
Interest in the Class M-2 Certificates.
The Class M-2 Certificates are limited in right of payment to certain
collections and recoveries respecting the Mortgage Loans, all as more
specifically set forth herein and in the Agreement. As provided in the
Agreement, withdrawals from the Collection Account and the Distribution Account
may be made from time to time for purposes other than distributions to
Certificateholders, such purposes including reimbursement of advances made, or
certain expenses incurred, with respect to the Mortgage Loans.
This certificate is subordinated in right of payment to the Class A and
Class M-1 Certificates as described in the Pooling and Servicing Agreement
referred to herein.
The Agreement permits, with certain exceptions therein provided, the
amendment thereof and the modification of the rights and obligations of the
Depositor, the Servicer, the Trustee and the rights of the Certificateholders
under the Agreement at any time by the Depositor, the Servicer and the Trustee
with the consent of the Holders of Certificates entitled to the Voting Rights
identified 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 herefor 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 upon surrender of this Certificate for registration of transfer at the
offices or agencies appointed by the Trustee as provided in the Agreement, duly
endorsed by, or accompanied by an assignment in the form below or other 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 evidencing the same aggregate Percentage
Interest will be issued to the designated transferee or transferees.
The Certificates are issuable in fully registered form only without
coupons in Classes and denominations representing Percentage Interests 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 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 of Certificates, but the Trustee may require payment of a sum
sufficient to cover any tax or other governmental charge that may be imposed in
connection with any transfer or exchange of Certificates.
The Depositor, the Servicer, the Trustee and the Certificate Registrar and
any agent of the Depositor, the Servicer, the Trustee or the Certificate
Registrar may treat the Person in whose name this Certificate is registered as
the owner hereof for all purposes, and none of the Depositor, the Servicer, the
Trustee, the Certificate Registrar nor any such agent shall be affected by
notice to the contrary.
The obligations created by the Agreement and the Trust Fund created
thereby shall terminate upon payment to the Certificateholders of all amounts
held by or on behalf of the Trustee and required to be paid to them pursuant to
the Agreement following the earlier of (i) the final payment or other
liquidation (or any advance with respect thereto) of the last Mortgage Loan
remaining in the Trust Fund, and (ii) the purchase by the party designated in
the Agreement at a price determined as provided in the Agreement from the Trust
Fund of all Mortgage Loans and all property acquired in respect of such Mortgage
Loans. The Agreement permits, but does not require, the party designated in the
Agreement to purchase from the Trust Fund all Mortgage Loans and all property
acquired in respect of any Mortgage Loan at a price determined as provided in
the Agreement. The exercise of such right will effect early retirement of the
Certificates; however, such right to purchase is subject to the aggregate
Principal Balance of the Mortgage Loans at the time of purchase being 10% or
less of the Cut-off Date Aggregate Principal Balance.
The recitals contained herein shall be taken as statements of the
Depositor and the Trustee assumes no responsibility for their correctness.
Unless the certificate of authentication hereon has been executed by the
Certificate Registrar, by manual signature, this Certificate shall not be
entitled to any benefit under the Agreement or be valid for any purpose.
<PAGE>
IN WITNESS WHEREOF, the Trustee has caused this Certificate to be duly
executed.
Dated: December 21, 1999
THE CHASE MANHATTAN BANK, as Trustee
By:_________________________________
Authorized Officer
CERTIFICATE OF AUTHENTICATION
This is one of the Class M-2 Certificates referred to in the
within-mentioned Agreement.
THE CHASE MANHATTAN BANK, as Certificate
Registrar
By:____________________________
Authorized Signatory
Date of authentication: December 21, 1999
<PAGE>
ABBREVIATIONS
The following abbreviations, when used in the inscription on the face of this
instrument, shall be construed as though they were written out in full according
to applicable laws or regulations:
TEN COM - as tenants in common UNIF GIFT MIN ACT - Custodian
(Cust) (Minor)
TEN ENT - as tenants by the entireties under Uniform Gifts
to Minors Act
JT TEN - as joint tenants with right
if survivorship and not as ___________________
tenants in common (State)
Additional abbreviations may also be used though not in the above
list.
ASSIGNMENT
FOR VALUE RECEIVED, the undersigned hereby sell(s), assign(s) and
transfer(s) unto _______________________________________________________________
________________________________________________________________________________
(Please print or typewrite name, address including postal zip code, and Taxpayer
Identification Number of assignee)______________________________________________
________________________________________________________________________________
a Percentage Interest equal to ____% evidenced by the within asset-backed
Certificate and hereby authorize(s) the registration of transfer of such
interest to assignee on the Certificate Register of the Trust Fund.
I (we) further direct the Certificate Registrar to issue a new
Certificate of a like Percentage Interest and Class to the above named assignee
and deliver such Certificate to the following address:
_______________________________________________________________________________.
Dated:
______________________________________
Signature by or on behalf of assignor
______________________________________
Signature Guaranteed
<PAGE>
DISTRIBUTION INSTRUCTIONS
The assignee should include the following for purposes of
distribution:
Distributions shall be made, by wire transfer or otherwise, in
immediately available funds to _________________________________________________
________________________________________________________________________________
for the account of _______________________________, account number ____________,
or, if mailed by check, to ____________________________________________________.
Applicable statements should be mailed to ______________________________________
This information is provided by _______________________________________________,
the assignee named above, or ____________________________________, as its agent.
<PAGE>
EXHIBIT C-4
[FORM OF CLASS X CERTIFICATES]
ASSET BACKED FUNDING CERTIFICATES
SERIES 1999-1, CLASS X
[SOLELY FOR U.S. FEDERAL INCOME TAX PURPOSES, THIS CERTIFICATE IS A
"REGULAR INTEREST" IN A "REAL ESTATE MORTGAGE INVESTMENT CONDUIT," AS
THOSE TERMS ARE DEFINED, RESPECTIVELY, IN SECTIONS 860G AND 860D OF THE
INTERNAL REVENUE CODE OF 1986, AS AMENDED (THE "CODE").]
THIS CLASS X CERTIFICATE IS SUBORDINATE TO THE OFFERED CERTIFICATES OF
THIS SERIES TO THE EXTENT DESCRIBED HEREIN AND IN THE POOLING AND
SERVICING AGREEMENT REFERRED TO HEREIN.
THIS CLASS X CERTIFICATE WILL NOT BE ENTITLED TO PAYMENTS UNTIL SUCH TIME
AS DESCRIBED IN THE POOLING AND SERVICING AGREEMENT REFERRED TO HEREIN.
THIS CLASS X CERTIFICATE HAS NOT BEEN REGISTERED OR QUALIFIED UNDER THE
SECURITIES ACT OF 1933, AS AMENDED (THE "1933 ACT"), OR THE SECURITIES
LAWS OF ANY STATE. ANY RESALE, TRANSFER OR OTHER DISPOSITION OF THIS
CERTIFICATE WITHOUT SUCH REGISTRATION OR QUALIFICATION MAY BE MADE ONLY IN
A TRANSACTION THAT DOES NOT REQUIRE SUCH REGISTRATION OR QUALIFICATION AND
IN ACCORDANCE WITH THE PROVISIONS OF SECTION 5.02 OF THE POOLING AND
SERVICING AGREEMENT REFERRED TO HEREIN.
NO TRANSFER OF THIS CERTIFICATE TO AN EMPLOYEE BENEFIT PLAN OR OTHER
RETIREMENT ARRANGEMENT SUBJECT TO THE EMPLOYEE RETIREMENT INCOME SECURITY
ACT OF 1974, AS AMENDED, OR THE CODE WILL BE REGISTERED EXCEPT IN
COMPLIANCE WITH THE PROCEDURES DESCRIBED HEREIN.
Series 1999-1, Class X Servicer: Litton Loan Servicing LP
Date of Pooling and Servicing Agreement Trustee: The Chase Manhattan Bank
and Cut-off Date: November 1, 1999
Closing Date: December 21, 1999
First Distribution Date: December 27,
1999
No.
Percentage Interest:
ASSET BACKED FUNDING CERTIFICATE
evidencing a beneficial ownership interest in a portion of a Trust Fund
consisting primarily of a pool of conventional one- to four-family first
mortgage loans formed and sold by
ASSET BACKED FUNDING CORPORATION
THIS CERTIFICATE DOES NOT REPRESENT AN OBLIGATION OF OR INTEREST IN ASSET
BACKED FUNDING CORPORATION, THE SERVICER, THE SERVICER, THE TRUSTEE OR ANY OF
THEIR AFFILIATES. NEITHER THIS CERTIFICATE NOR THE UNDERLYING MORTGAGE LOANS ARE
GUARANTEED BY ANY AGENCY OR INSTRUMENTALITY OF THE UNITED STATES.
This certifies that __________________________________ is the
registered owner of a Percentage Interest set forth above in that certain
beneficial ownership interest evidenced by all the Class X Certificates in the
Trust Fund created pursuant to a Pooling and Servicing Agreement, dated as
specified above (the "Agreement"), among Asset Backed Funding Corporation
(hereinafter called the "Depositor," which term includes any successor entity
under the Agreement), the Servicer and the Trustee, a summary of certain of the
pertinent provisions of which is set forth hereafter. 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.
Pursuant to the terms of the Agreement, distributions 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 (a "Distribution Date"), commencing on the
first Distribution Date specified above, to the Person in whose name this
Certificate is registered on the last Business Day of the month immediately
preceding the month in which the related Distribution Date occurs or the Closing
Date in the case of the first Distribution Date (the "Record Date"), from funds
in the Distribution Account in an amount equal to the product of the Percentage
Interest evidenced by this Certificate and the amount required to be distributed
to the Holders of Class X Certificates on such Distribution Date pursuant to the
Agreement.
All distributions to the Holder of this Certificate under the
Agreement will be made or caused to be made by or on behalf of the Trustee by
wire transfer in immediately available funds to the account of the Person
entitled thereto if such Person shall have so notified the Trustee in writing at
least five Business Days prior to the Record Date immediately prior to such
Distribution Date and is the registered owner of Class X Certificates the
aggregate initial Certificate Principal Balance of which is in excess of a 66%
Percentage Interest of the Class X Certificates, or by check mailed by first
class mail to the address of the Person entitled thereto, as such name and
address shall appear on the Certificate Register, provided that the Trustee may
deduct a reasonable wire transfer fee from any payment made by wire transfer.
Notwithstanding the above, the final distribution on this Certificate will be
made after due notice by the Trustee of the pendency of such distribution and
only upon presentation and surrender of this Certificate at the office or agency
appointed by the Trustee for that purpose as provided in the Agreement.
This Certificate is one of a duly authorized issue of Certificates
designated as Asset Backed Funding Certificates of the Series specified on the
face hereof (herein called the "Certificates") and representing the Percentage
Interest specified on the face hereof.
The Class X Certificates are limited in right of payment to certain
collections and recoveries respecting the Mortgage Loans, all as more
specifically set forth herein and in the Agreement. As provided in the
Agreement, withdrawals from the Collection Account and the Distribution Account
may be made from time to time for purposes other than distributions to
Certificateholders, such purposes including reimbursement of advances made, or
certain expenses incurred, with respect to the Mortgage Loans.
The Agreement permits, with certain exceptions therein provided, the
amendment thereof and the modification of the rights and obligations of the
Depositor, the Servicer, the Trustee and the rights of the Certificateholders
under the Agreement at any time by the Depositor, the Servicer and the Trustee
with the consent of the Holders of Certificates entitled to the Voting Rights
identified 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 herefor 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 upon surrender of this Certificate for registration of
transfer at the offices or agencies appointed by the Trustee as provided in the
Agreement, duly endorsed by, or accompanied by an assignment in the form below
or other 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 evidencing the same aggregate
Percentage Interest will be issued to the designated transferee or transferees.
The Certificates are issuable in fully registered form only without
coupons in Classes and denominations representing Percentage Interests 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 evidencing the same
aggregate Percentage Interest, as requested by the Holder surrendering the same.
No transfer of this Certificate shall be made unless that transfer
is made pursuant to an effective registration statement under the 1933 Act and
effective registration or qualification under applicable state securities laws,
or is made in a transaction that does not require such registration or
qualification. In the event that a transfer is to be made without registration
or qualification, the Trustee and the Certificate Registrar shall require, in
order to assure compliance with such laws, either (i) that the Certificateholder
desiring to effect the transfer and such Certificateholder's prospective
transferee each execute a representation letter in the form described by the
Agreement certifying to the Trustee and the Certificate Registrar the facts
surrounding the transfer, or (ii) that the Trustee and the Certificate Registrar
shall require an Opinion of Counsel satisfactory to them that such transfer may
be made without such registration or qualification, which Opinion of Counsel
shall not be an expense of the Depositor, the Trustee or the Certificate
Registrar, in their respective capacities as such. None of the Depositor, the
Certificate Registrar nor the Trustee is obligated to register or qualify the
Class of Certificates specified on the face hereof under the 1933 Act or any
other securities law or to take any action not otherwise required under the
Agreement to permit the transfer of such Certificates without registration or
qualification. Any such Certificateholder desiring to effect such transfer
shall, and does hereby agree to, indemnify the Trustee, the Depositor, the
Certificate Registrar 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.
Except as otherwise set forth in the next succeeding paragraph, no
transfer of a Certificate or any interest therein may be made to employee
benefit plans and certain other retirement plans and arrangements, including
individual retirement accounts and annuities, Keogh plans and collective
investment funds and separate accounts in which such plans, accounts or
arrangements are invested that are subject to the fiduciary responsibility
provisions of ERISA and Section 4975 of the Code ("Plans") or any person who is
directly or indirectly purchasing the Certificate or interest therein on behalf
of, as named fiduciary of, as trustee of, or with assets of a Plan, unless the
prospective transferee provides the Trustee with an opinion of counsel which
establish to the satisfaction of the Trustee that such transfer will not result
in a violation of Section 406 of ERISA or Section 4975 of the Code or cause the
Servicer or Trustee to be deemed a fiduciary of such Plan or result in the
imposition of an excise tax under Section 4975 of the Code. In the absence of
its having received the opinion of counsel contemplated by the preceding
sentence, the Trustee shall (unless the next succeeding paragraph applies)
require the prospective transferee of any Certificate to certify that it is
neither (i) a Plan nor (ii) a Person who is directly or indirectly purchasing
such Certificate on behalf of, as named fiduciary of, as trustee of, or with
assets of a Plan (including any insurance company using funds in its general or
separate accounts that may constitute "plan assets").
No service charge will be made for any such registration of transfer
or exchange of Certificates, but the Trustee may require payment of a sum
sufficient to cover any tax or other governmental charge that may be imposed in
connection with any transfer or exchange of Certificates.
The Depositor, the Servicer, the Trustee and the Certificate
Registrar and any agent of the Depositor, the Servicer, the Trustee or the
Certificate Registrar may treat the Person in whose name this Certificate is
registered as the owner hereof for all purposes, and none of the Depositor, the
Servicer, the Trustee, the Certificate Registrar nor any such agent shall be
affected by notice to the contrary.
The obligations created by the Agreement and the Trust Fund created
thereby shall terminate upon payment to the Certificateholders of all amounts
held by or on behalf of the Trustee and required to be paid to them pursuant to
the Agreement following the earlier of (i) the final payment or other
liquidation (or any advance with respect thereto) of the last Mortgage Loan
remaining in the Trust Fund, and (ii) the purchase by the party designated in
the Agreement at a price determined as provided in the Agreement from the Trust
Fund of all Mortgage Loans and all property acquired in respect of such Mortgage
Loans. The Agreement permits, but does not require, the party designated in the
Agreement to purchase from the Trust Fund all Mortgage Loans and all property
acquired in respect of any Mortgage Loan at a price determined as provided in
the Agreement. The exercise of such right will effect early retirement of the
Certificates; however, such right to purchase is subject to the aggregate
Principal Balance of the Mortgage Loans at the time of purchase being 10% or
less of the Cut-off Date Aggregate Principal Balance.
The recitals contained herein shall be taken as statements of the
Depositor and the Trustee assumes no responsibility for their correctness.
Unless the certificate of authentication hereon has been executed by
the Certificate Registrar, by manual signature, this Certificate shall not be
entitled to any benefit under the Agreement or be valid for any purpose.
<PAGE>
IN WITNESS WHEREOF, the Trustee has caused this Certificate to be
duly executed.
Dated: December 21, 1999
THE CHASE MANHATTAN BANK, as Trustee
By:____________________________
Authorized Officer
CERTIFICATE OF AUTHENTICATION
This is one of the Class X Certificates referred to in the
within-mentioned Agreement.
Dated: December 21, 1999
THE CHASE MANHATTAN BANK, as Certificate
Registrar
By:_______________________________
Authorized Signatory
<PAGE>
ABBREVIATIONS
The following abbreviations, when used in the inscription on the face of this
instrument, shall be construed as though they were written out in full according
to applicable laws or regulations:
TEN COM - as tenants in common UNIF GIFT MIN ACT - Custodian
(Cust) (Minor)
TEN ENT - as tenants by the entireties under Uniform Gifts
to Minors Act
JT TEN - as joint tenants with right
if survivorship and not as ___________________
tenants in common (State)
Additional abbreviations may also be used though not in the above
list.
ASSIGNMENT
FOR VALUE RECEIVED, the undersigned hereby sell(s), assign(s) and
transfer(s) unto _______________________________________________________________
________________________________________________________________________________
(Please print or typewrite name, address including postal zip code, and Taxpayer
Identification Number of assignee)______________________________________________
________________________________________________________________________________
a Percentage Interest equal to ____% evidenced by the within asset-backed
Certificate and hereby authorize(s) the registration of transfer of such
interest to assignee on the Certificate Register of the Trust Fund.
I (we) further direct the Certificate Registrar to issue a new
Certificate of a like Percentage Interest and Class to the above named assignee
and deliver such Certificate to the following address:
_______________________________________________________________________________.
Dated:
______________________________________
Signature by or on behalf of assignor
______________________________________
Signature Guaranteed
<PAGE>
DISTRIBUTION INSTRUCTIONS
The assignee should include the following for purposes of
distribution:
Distributions shall be made, by wire transfer or otherwise, in
immediately available funds to _________________________________________________
________________________________________________________________________________
for the account of _______________________________, account number ____________,
or, if mailed by check, to ____________________________________________________.
Applicable statements should be mailed to ______________________________________
This information is provided by _______________________________________________,
the assignee named above, or ____________________________________, as its agent.
<PAGE>
EXHIBIT C-5
[FORM OF CLASS BB CERTIFICATE]
ASSET BACKED FUNDING CERTIFICATES
SERIES 1999-1, CLASS BB
[SOLELY FOR U.S. FEDERAL INCOME TAX PURPOSES, THIS CERTIFICATE IS A
"REGULAR INTEREST" IN A "REAL ESTATE MORTGAGE INVESTMENT CONDUIT," AS
THOSE TERMS ARE DEFINED, RESPECTIVELY, IN SECTIONS 860G AND 860D OF THE
INTERNAL REVENUE CODE OF 1986, AS AMENDED (THE "CODE").]
THIS CLASS BB CERTIFICATE IS SUBORDINATE TO THE OFFERED CERTIFICATES OF
THIS SERIES TO THE EXTENT DESCRIBED HEREIN AND IN THE POOLING AND
SERVICING AGREEMENT REFERRED TO HEREIN.
THIS CLASS BB CERTIFICATE WILL NOT BE ENTITLED TO PAYMENTS UNTIL SUCH TIME
AS DESCRIBED IN THE POOLING AND SERVICING AGREEMENT REFERRED TO HEREIN.
THIS CLASS BB CERTIFICATE HAS NOT BEEN REGISTERED OR QUALIFIED UNDER THE
SECURITIES ACT OF 1933, AS AMENDED (THE "1933 ACT"), OR THE SECURITIES
LAWS OF ANY STATE. ANY RESALE, TRANSFER OR OTHER DISPOSITION OF THIS
CERTIFICATE WITHOUT SUCH REGISTRATION OR QUALIFICATION MAY BE MADE ONLY IN
A TRANSACTION THAT DOES NOT REQUIRE SUCH REGISTRATION OR QUALIFICATION AND
IN ACCORDANCE WITH THE PROVISIONS OF SECTION 5.02 OF THE POOLING AND
SERVICING AGREEMENT REFERRED TO HEREIN.
NO TRANSFER OF THIS CERTIFICATE TO AN EMPLOYEE BENEFIT PLAN OR OTHER
RETIREMENT ARRANGEMENT SUBJECT TO THE EMPLOYEE RETIREMENT INCOME SECURITY
ACT OF 1974, AS AMENDED, OR THE CODE WILL BE REGISTERED EXCEPT IN
COMPLIANCE WITH THE PROCEDURES DESCRIBED HEREIN.
Series 1999-1, Class BB Original Class BB Notional Amount as
of the Closing Date:
Date of Pooling and Servicing Agreement
and Cut-off Date: November 1, 1999 Denomination: $________ (Notional
Amount)
First Distribution Date: December 27,
1999 Servicer: Litton Loan Servicing LP
No. Trustee: The Chase Manhattan Bank
Closing Date: December 21, 1999
ASSET BACKED FUNDING CERTIFICATE
evidencing a beneficial ownership interest in a portion of a Trust Fund
consisting primarily of a pool of conventional one- to four-family first
mortgage loans formed and sold by
ASSET BACKED FUNDING CORPORATION
THIS CERTIFICATE DOES NOT REPRESENT AN OBLIGATION OF OR INTEREST IN ASSET
BACKED FUNDING CORPORATION, THE SERVICER, THE SERVICER, THE TRUSTEE OR ANY OF
THEIR AFFILIATES. NEITHER THIS CERTIFICATE NOR THE UNDERLYING MORTGAGE LOANS ARE
GUARANTEED BY ANY AGENCY OR INSTRUMENTALITY OF THE UNITED STATES.
This certifies that __________________________________ is the
registered owner of a Percentage Interest (obtained by dividing the denomination
of this Certificate by the Original Class BB Notionl Amount)H in that certain
beneficial ownership interest evidenced by all the Class BB Certificates in the
Trust Fund created pursuant to a Pooling and Servicing Agreement, dated as
specified above (the "Agreement"), among Asset Backed Funding Corporation
(hereinafter called the "Depositor," which term includes any successor entity
under the Agreement), the Servicer and the Trustee, a summary of certain of the
pertinent provisions of which is set forth hereafter. 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.
Pursuant to the terms of the Agreement, distributions 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 (a "Distribution Date"), commencing on the
first Distribution Date specified above, to the Person in whose name this
Certificate is registered on the last Business Day of the month immediately
preceding the month in which the related Distribution Date occurs or the Closing
Date in the case of the first Distribution Date (the "Record Date"), from funds
in the Distribution Account in an amount equal to the product of the Percentage
Interest evidenced by this Certificate and the amount required to be distributed
to the Holders of Class BB Certificates on such Distribution Date pursuant to
the Agreement.
All distributions to the Holder of this Certificate under the
Agreement will be made or caused to be made by or on behalf of the Trustee by
wire transfer in immediately available funds to the account of the Person
entitled thereto if such Person shall have so notified the Trustee in writing at
least five Business Days prior to the Record Date immediately prior to such
Distribution Date and is the registered owner of Class BB Certificates the
aggregate initial Certificate Principal Balance of which is in excess of a 66%
Percentage Interest of the Class BB Certificates, or by check mailed by first
class mail to the address of the Person entitled thereto, as such name and
address shall appear on the Certificate Register, provided that the Trustee may
deduct a reasonable wire transfer fee from any payment made by wire transfer.
Notwithstanding the above, the final distribution on this Certificate will be
made after due notice by the Trustee of the pendency of such distribution and
only upon presentation and surrender of this Certificate at the office or agency
appointed by the Trustee for that purpose as provided in the Agreement.
This Certificate is one of a duly authorized issue of Certificates
designated as Asset Backed Funding Certificates of the Series specified on the
face hereof (herein called the "Certificates") and representing the Percentage
Interest specified on the face hereof.
The Class BB Certificates are limited in right of payment to certain
collections and recoveries respecting the Mortgage Loans, all as more
specifically set forth herein and in the Agreement. As provided in the
Agreement, withdrawals from the Collection Account and the Distribution Account
may be made from time to time for purposes other than distributions to
Certificateholders, such purposes including reimbursement of advances made, or
certain expenses incurred, with respect to the Mortgage Loans.
The Agreement permits, with certain exceptions therein provided, the
amendment thereof and the modification of the rights and obligations of the
Depositor, the Servicer, the Trustee and the rights of the Certificateholders
under the Agreement at any time by the Depositor, the Servicer and the Trustee
with the consent of the Holders of Certificates entitled to the Voting Rights
identified 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 herefor 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 upon surrender of this Certificate for registration of
transfer at the offices or agencies appointed by the Trustee as provided in the
Agreement, duly endorsed by, or accompanied by an assignment in the form below
or other 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 evidencing the same aggregate
Percentage Interest will be issued to the designated transferee or transferees.
The Certificates are issuable in fully registered form only without
coupons in Classes and denominations representing Percentage Interests 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 evidencing the same
aggregate Percentage Interest, as requested by the Holder surrendering the same.
No transfer of this Certificate shall be made unless that transfer
is made pursuant to an effective registration statement under the 1933 Act and
effective registration or qualification under applicable state securities laws,
or is made in a transaction that does not require such registration or
qualification. In the event that a transfer is to be made without registration
or qualification, the Trustee and the Certificate Registrar shall require, in
order to assure compliance with such laws, either (i) that the Certificateholder
desiring to effect the transfer and such Certificateholder's prospective
transferee each execute a representation letter in the form described by the
Agreement certifying to the Trustee and the Certificate Registrar the facts
surrounding the transfer, or (ii) that the Trustee and the Certificate Registrar
shall require an Opinion of Counsel satisfactory to them that such transfer may
be made without such registration or qualification, which Opinion of Counsel
shall not be an expense of the Depositor, the Trustee or the Certificate
Registrar, in their respective capacities as such. None of the Depositor, the
Certificate Registrar nor the Trustee is obligated to register or qualify the
Class of Certificates specified on the face hereof under the 1933 Act or any
other securities law or to take any action not otherwise required under the
Agreement to permit the transfer of such Certificates without registration or
qualification. Any such Certificateholder desiring to effect such transfer
shall, and does hereby agree to, indemnify the Trustee, the Depositor, the
Certificate Registrar 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.
Except as otherwise set forth in the next succeeding paragraph, no
transfer of a Certificate or any interest therein may be made to employee
benefit plans and certain other retirement plans and arrangements, including
individual retirement accounts and annuities, Keogh plans and collective
investment funds and separate accounts in which such plans, accounts or
arrangements are invested that are subject to the fiduciary responsibility
provisions of ERISA and Section 4975 of the Code ("Plans") or any person who is
directly or indirectly purchasing the Certificate or interest therein on behalf
of, as named fiduciary of, as trustee of, or with assets of a Plan, unless the
prospective transferee provides the Trustee with an opinion of counsel which
establish to the satisfaction of the Trustee that such transfer will not result
in a violation of Section 406 of ERISA or Section 4975 of the Code or cause the
Servicer or Trustee to be deemed a fiduciary of such Plan or result in the
imposition of an excise tax under Section 4975 of the Code. In the absence of
its having received the opinion of counsel contemplated by the preceding
sentence, the Trustee shall require the prospective transferee of any
Certificate to certify that it is neither (i) a Plan nor (ii) a Person who is
directly or indirectly purchasing such Certificate on behalf of, as named
fiduciary of, as trustee of, or with assets of a Plan (including any insurance
company using funds in its general or separate accounts that may constitute
"plan assets").
No service charge will be made for any such registration of transfer
or exchange of Certificates, but the Trustee may require payment of a sum
sufficient to cover any tax or other governmental charge that may be imposed in
connection with any transfer or exchange of Certificates.
The Depositor, the Servicer, the Trustee and the Certificate
Registrar and any agent of the Depositor, the Servicer, the Trustee or the
Certificate Registrar may treat the Person in whose name this Certificate is
registered as the owner hereof for all purposes, and none of the Depositor, the
Servicer, the Trustee, the Certificate Registrar nor any such agent shall be
affected by notice to the contrary.
The obligations created by the Agreement and the Trust Fund created
thereby shall terminate upon payment to the Certificateholders of all amounts
held by or on behalf of the Trustee and required to be paid to them pursuant to
the Agreement following the earlier of (i) the final payment or other
liquidation (or any advance with respect thereto) of the last Mortgage Loan
remaining in the Trust Fund, and (ii) the purchase by the party designated in
the Agreement at a price determined as provided in the Agreement from the Trust
Fund of all Mortgage Loans and all property acquired in respect of such Mortgage
Loans. The Agreement permits, but does not require, the party designated in the
Agreement to purchase from the Trust Fund all Mortgage Loans and all property
acquired in respect of any Mortgage Loan at a price determined as provided in
the Agreement. The exercise of such right will effect early retirement of the
Certificates; however, such right to purchase is subject to the aggregate
Principal Balance of the Mortgage Loans at the time of purchase being 10% or
less of the Cut-off Date Aggregate Principal Balance.
The recitals contained herein shall be taken as statements of the
Depositor and the Trustee assumes no responsibility for their correctness.
Unless the certificate of authentication hereon has been executed by
the Certificate Registrar, by manual signature, this Certificate shall not be
entitled to any benefit under the Agreement or be valid for any purpose.
<PAGE>
IN WITNESS WHEREOF, the Trustee has caused this Certificate to be
duly executed.
Dated: December 21, 1999
THE CHASE MANHATTAN BANK, as Trustee
By:_________________________________
Authorized Officer
CERTIFICATE OF AUTHENTICATION
This is one of the Class BB Certificates referred to in the
within-mentioned Agreement.
Dated: December 21, 1999
THE CHASE MANHATTAN BANK, as Certificate
Registrar
By:_________________________________
Authorized Signatory
<PAGE>
ABBREVIATIONS
The following abbreviations, when used in the inscription on the face of this
instrument, shall be construed as though they were written out in full according
to applicable laws or regulations:
TEN COM - as tenants in common UNIF GIFT MIN ACT - Custodian
(Cust) (Minor)
TEN ENT - as tenants by the entireties under Uniform Gifts
to Minors Act
JT TEN - as joint tenants with right
if survivorship and not as ___________________
tenants in common (State)
Additional abbreviations may also be used though not in the above
list.
ASSIGNMENT
FOR VALUE RECEIVED, the undersigned hereby sell(s), assign(s) and
transfer(s) unto _______________________________________________________________
________________________________________________________________________________
(Please print or typewrite name, address including postal zip code, and Taxpayer
Identification Number of assignee)______________________________________________
________________________________________________________________________________
a Percentage Interest equal to ____% evidenced by the within asset-backed
Certificate and hereby authorize(s) the registration of transfer of such
interest to assignee on the Certificate Register of the Trust Fund.
I (we) further direct the Certificate Registrar to issue a new
Certificate of a like Percentage Interest and Class to the above named assignee
and deliver such Certificate to the following address:
_______________________________________________________________________________.
Dated:
______________________________________
Signature by or on behalf of assignor
______________________________________
Signature Guaranteed
<PAGE>
DISTRIBUTION INSTRUCTIONS
The assignee should include the following for purposes of
distribution:
Distributions shall be made, by wire transfer or otherwise, in
immediately available funds to _________________________________________________
________________________________________________________________________________
for the account of _______________________________, account number ____________,
or, if mailed by check, to ____________________________________________________.
Applicable statements should be mailed to ______________________________________
This information is provided by _______________________________________________,
the assignee named above, or ____________________________________, as its agent.
<PAGE>
EXHIBIT D-1
MORTGAGE LOAN SCHEDULE OF ORIGINATOR MORTGAGE LOANS
<PAGE>
EXHIBIT D-2
MORTGAGE LOAN SCHEDULE OF SELLER MORTGAGE LOANS
<PAGE>
EXHIBIT D-3
LIST OF PMI MORTGAGE LOANS
<PAGE>
EXHIBIT E
FORM OF REQUEST FOR RELEASE OF DOCUMENTS
To: The Chase Manhattan Bank
450 West 33rd Street
14th Floor
New York, New York 10001
Attn: Capital Markets Fiduciary Services,
Asset Backed Funding Corporation Series 1999-1
Re: Pooling and Servicing Agreement dated as of November 1, 1999 among Asset
Backed Funding Corporation, as depositor, Credit-Based Asset Servicing and
Securitization LLC, as seller, Litton Loan Servicing LP, as servicer, and
The Chase Manhattan Bank, as trustee.
All capitalized terms used herein shall have the means ascribed to them in
the Pooling and Servicing Agreement (the "Agreement") referenced above.
In connection with the administration of the Mortgage Loans held by you as
Trustee pursuant to the Agreement, we request the release, and hereby
acknowledge receipt, of the Trustee's Mortgage File for the Mortgage Loan
described below, for the reason indicated.
Mortgage Loan Number:
- --------------------
Mortgagor Name, Address & Zip Code:
- ----------------------------------
Reason for Requesting Documents (check one):
- -------------------------------
_____ 1. Mortgage Paid in Full
_____ 2. Foreclosure
_____ 3. Substitution
_____ 4. Other Liquidation (Repurchases, etc.)
_____ 5. Nonliquidation Reason: _________________
By:______________________
(authorized signer)
Issuer:____________________
Address:___________________
___________________
Date: ___________________
Custodian
- ---------
Bank One Trust Company, NA
Please acknowledge the execution of the above request by your signature
and date below:
________________________________ ___________
Signature Date
Documents returned to Custodian:
________________________________ ___________
Custodian Date
<PAGE>
EXHIBIT F-1
FORM OF TRUSTEE'S INITIAL CERTIFICATION
______________________
Date
Asset Backed Funding Corporation
100 North Tryon Street
11th Floor
Charlotte, N.C. 28255
Re: Pooling and Servicing Agreement (the "Pooling and Servicing
Agreement"), dated as of November 1, 1999 among Asset Backed Funding
Corporation, as depositor, Credit-Based Asset Servicing and Securitization LLC,
as seller, Litton Loan Servicing LP, as servicer, The Chase Manhattan Bank, as
trustee with respect to Asset Backed Funding Certificates, Series 1999-1.
Ladies and Gentlemen:
In accordance with Section 2.02 of the Pooling and Servicing Agreement,
the undersigned, as Trustee, hereby certifies that it received confirmation from
the Custodian that the Custodian has received the documents listed in Section
2.01 of the Pooling and Servicing Agreement for each Mortgage File pertaining to
each Mortgage Loan listed on Schedule A, to the Pooling and Servicing Agreement,
subject to any exceptions noted on Schedule I hereto.
Capitalized words and phrases used herein and not otherwise defined herein
shall have the respective meanings assigned to them in the Pooling and Servicing
Agreement. This Certificate is subject in all respects to the terms of Section
2.02 of the Pooling and Servicing Agreement and the Pooling and Servicing
Agreement sections cross-referenced therein.
THE CHASE MANHATTAN BANK
as Trustee
By:______________________________
Name:
Title:
<PAGE>
EXHIBIT F-2
FORM OF TRUSTEE'S FINAL CERTIFICATION
______________________
[Date]
Asset Backed Funding Corporation
100 North Tryon Street
11th Floor
Charlotte, N.C. 28255
Re: Pooling and Servicing Agreement (the "Pooling and Servicing
Agreement"), dated as of November 1, 1999 among Asset Backed Funding
Corporation, as depositor, Credit-Based Asset Servicing and Securitization LLC,
as seller, Litton Loan Servicing LP, as servicer, The Chase Manhattan Bank, as
trustee with respect to Asset Backed Funding Certificates, Series 1999-1.
Ladies and Gentlemen:
In accordance with Section 2.02 of the Pooling and Servicing Agreement,
the undersigned, as Trustee, hereby certifies that as to each Mortgage Loan
listed in the Mortgage Loan Schedule (other than any Mortgage Loan paid in full
or listed on Schedule I hereto) it received confirmation from the Custodian that
the Custodian has received the applicable documents listed in Section 2.01 of
the Pooling and Servicing Agreement.
The undersigned hereby certifies that as to each Mortgage Loan identified
on the Mortgage Loan Schedule, other than any Mortgage Loan listed on Schedule I
hereto, it has reviewed the documents listed above and has determined that each
such document appears to be complete and, based on an examination of such
documents, the information set forth in the Mortgage Loan Schedule is correct.
Capitalized words and phrases used herein shall have the respective
meanings assigned to them in the Pooling and Servicing Agreement. This
Certificate is qualified in all respects by the terms of said Pooling and
Servicing Agreement.
THE CHASE MANHATTAN BANK,
as Trustee
By:________________________________
Name:
Title:
<PAGE>
EXHIBIT F-3
FORM OF RECEIPT OF MORTGAGE NOTE
Asset Backed Funding Corporation
100 North Tryon Street
11th Floor
Charlotte, N.C. 28255
Re: Asset Backed Funding Certificates, Series 1999-1
-------------------------------------------------
Ladies and Gentlemen:
Pursuant to Section 2.01 of the Pooling and Servicing Agreement, dated as
of November 1, 1999, among Asset Backed Funding Corporation, as depositor,
Credit-Based Asset Servicing and Securitization LLC, as seller, Litton Loan
Servicing LP, as servicer, and The Chase Manhattan Bank, as trustee (the
"Trustee"), we hereby acknowledge the receipt of the original Mortgage Note (a
copy of which is attached hereto as Exhibit 1) with any exceptions thereto
listed on Exhibit 2.
THE CHASE MANHATTAN BANK,
as Trustee
By:________________________________
Name:
Title:
<PAGE>
EXHIBIT G
MORTGAGE LOAN PURCHASE AGREEMENT
[SEE ITEM #5]
<PAGE>
EXHIBIT H
FORM OF LOST NOTE AFFIDAVIT
Personally appeared before me the undersigned authority to administer
oaths, ______________________ who first being duly sworn deposes and says:
Deponent is ______________________ of ______________________________, successor
by merger to _________________________________________ ("Seller") and who has
personal knowledge of the facts set out in this affidavit.
On ___________________, _________________________ did execute and
deliver a promissory note in the principal amount of $__________.
That said note has been misplaced or lost through causes unknown and is
presently lost and unavailable after diligent search has been made. Seller's
records show that an amount of principal and interest on said note is still
presently outstanding, due, and unpaid, and Seller is still owner and holder in
due course of said lost note.
Seller executes this Affidavit for the purpose of inducing The Chase
Manhattan Bank, as trustee on behalf of Asset Backed Funding Certificates,
Series 1999-1, to accept the transfer of the above described loan from Seller.
Seller agrees to indemnify and hold harmless The Chase Manhattan Bank,
Asset Backed Funding Corporation, Banc of America Securities LLC and Prudential
Securities Incorporated for any losses incurred by such parties resulting from
the above described promissory note has been lost or misplaced.
By: __________________________________
__________________________________
STATE OF )
) SS:
COUNTY OF )
On this ____ day of _______ 199__, before me, a Notary Public, in and for
said County and State, appeared ________________________, who acknowledged the
extension of the foregoing and who, having been duly sworn, states that any
representations therein contained are true.
Witness my hand and Notarial Seal this ____ day of _______ 199__.
_______________________________
_______________________________
My commission expires _______________.
<PAGE>
EXHIBIT I
FORM OF ERISA REPRESENTATION
Asset Backed Funding Corporation
100 North Tryon Street
11th Floor
Charlotte, N.C. 28255
Re: Asset Backed Funding Certificates, Series 1999-1
-------------------------------------------------
Ladies and Gentlemen:
1. The undersigned is the ______________________ of (the
"Transferee") a [corporation duly organized] and existing under the laws of
__________, on behalf of which he makes this affidavit.
2. The Transferee hereby acknowledges that under the terms of the
Pooling and Servicing Agreement (the "Agreement") among Asset Backed Funding
Corporation, as depositor (the "Depositor"), Credit-Based Asset Servicing and
Securitization LLC, as seller, Litton Loan Servicing LP, as servicer and The
Chase Manhattan Bank, as trustee (the "Trustee"), no transfer of the
ERISA-Restricted Certificates shall be permitted to be made to any person unless
the Depositor and Trustee have received a certificate from such transferee in
the form hereof.
3. [With respect to the Class M-1, Class M-2 and Class B
Certificates only] The Transferee either (x) (1) is not an employee benefit plan
subject to Section 406 or Section 407 of the Employee Retirement Income Security
Act of 1974, as amended ("ERISA"), or Section 4975 of the Internal Revenue Code
of 1986, as amended (the "Code"), the Trustee of any such plan or a person
acting on behalf of any such plan nor a person using the assets of any such plan
or (2) if the Transferee is an insurance company, such Transferee is purchasing
such Certificates with funds contained in an "Insurance Company General Account"
(as such term is defined in Section v(e) of the 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 (y) shall deliver to the Trustee
and the Depositor an opinion of counsel (a "Benefit Plan Opinion") satisfactory
to the Trustee and the Depositor, and upon which the Trustee and the Depositor
shall be entitled to rely, to the effect that the purchase or holding of such
Certificate by the Transferee 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 or the Code and will not subject the Trustee or the
Depositor to any obligation in addition to those undertaken by such entities in
the Pooling and Servicing Agreement, which opinion of counsel shall not be an
expense of the Trustee or the Depositor.
3. [With respect to the Class X and Class BB Certificates only] The
Transferee either (x) is not an employee benefit plan subject to Section 406 or
Section 407 of the Employee Retirement Income Security Act of 1974, as amended
("ERISA"), or Section 4975 of the Internal Revenue Code of 1986, as amended (the
"Code"), the Trustee of any such plan or a person acting on behalf of any such
plan nor a person using the assets of any such plan or (y) shall deliver to the
Trustee and the Depositor an opinion of counsel (a "Benefit Plan Opinion")
satisfactory to the Trustee and the Depositor, and upon which the Trustee and
the Depositor shall be entitled to rely, to the effect that the purchase or
holding of such Certificate by the Transferee 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 or the Code and will not subject the Trustee or
the Depositor to any obligation in addition to those undertaken by such entities
in the Pooling and Servicing Agreement, which opinion of counsel shall not be an
expense of the Trustee or the Depositor.
Capitalized terms used but not defined herein shall have the
meanings ascribed to such terms in the Agreement.
IN WITNESS WHEREOF, the Transferee has executed this certificate.
_________________________________
[Transferee]
By:______________________________
Name:
Title:
<PAGE>
EXHIBIT J
FORM OF INVESTMENT LETTER [NON-RULE 144A]
[DATE]
Asset Backed Funding Corporation
100 North Tryon Street
11th Floor
Charlotte, N.C. 28255
The Chase Manhattan Bank
450 West 33rd Street
14th Floor
New York, NY 10001
Re: Asset Backed Funding Certificates, Series 1999-1
------------------------------------------------
Ladies and Gentlemen:
In connection with our acquisition of the Asset Backed Funding
Certificates, Series 1999-1 (the "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)
we are not an employee benefit plan that is subject to the Employee Retirement
Income Security Act of 1974, as amended, or a plan that is subject to Section
4975 of the Internal Revenue Code of 1986, as amended, nor are we acting on
behalf of any such plan, (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,
[NAME OF TRANSFEREE]
By: ___________________________
Authorized Officer
<PAGE>
FORM OF RULE 144A INVESTMENT LETTER
[DATE]
Asset Backed Funding Corporation
100 North Tryon Street
11th Floor
Charlotte, N.C. 28255
The Chase Manhattan Bank
450 West 33rd Street
14th Floor
New York, NY 10001
Re: Asset Backed Funding Certificates, Series 1999-1
--------------------------------- --------------
Ladies and Gentlemen:
In connection with our acquisition of the Asset Backed Funding
Certificates, Series 1999-1 (the "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 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, (c)
we are not an employee benefit plan that is subject to the Employee Retirement
Income Security Act of 1974, as amended, or a plan that is subject to Section
4975 of the Internal Revenue Code of 1986, as amended, nor are we acting on
behalf of any such plan, (d) 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, (e) 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.
Very truly yours,
[NAME OF TRANSFEREE]
By:_____________________________
Authorized Officer
<PAGE>
ANNEX 1 TO EXHIBIT J
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:
i. As indicated below, the undersigned is the President, Chief
Financial Officer, Senior Vice President or other executive officer of the
Buyer.
ii. In connection with purchases by the Buyer, the Buyer is a
"qualified institutional buyer" as that term is defined in Rule 144A under the
Securities Act of 1933, as amended ("Rule 144A") because (i) the Buyer owned
and/or invested on a discretionary basis $_____(1) in securities (except for the
excluded securities referred to below) as of the end of the Buyer's most recent
fiscal year (such amount being calculated in accordance with Rule 144A and (ii)
the Buyer satisfies the criteria in the category marked below.
___ Corporation, etc. The Buyer is a corporation (other than a
bank, savings and loan association or similar institution),
Massachusetts or similar business trust, partnership, or charitable
organization described in Section 501(c)(3) of the Internal Revenue
Code of 1986, as amended.
___ Bank. The Buyer (a) is a national bank or banking
institution organized under the laws of any State, territory or the
District of Columbia, the business of which is substantially
confined to banking and is supervised by the State or territorial
banking commission or similar official or is a foreign bank or
equivalent institution, and (b) has an audited net worth of at least
$25,000,000 as demonstrated in its latest annual financial
statements, a copy of which is attached hereto.
___ Savings and Loan. The Buyer (a) is a savings and loan
association, building and loan association, cooperative bank,
homestead association or similar institution, which is supervised
and examined by a State or Federal authority having supervision over
any such institutions or is a foreign savings and loan association
or equivalent institution and (b) has an audited net worth of at
least $25,000,000 as demonstrated in its latest annual financial
statements, a copy of which is attached hereto.
___ Broker-dealer. The Buyer is a dealer registered pursuant
to Section 15 of the Securities Exchange Act of 1934.
- -----------------
(1) Buyer must own and/or invest on a discretionary basis at least $100,000,000
in securities unless Buyer is a dealer, and, in that case, Buyer must own
and/or invest on a discretionary basis at least $10,000,000 in securities.
___ 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.
iii. 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.
iv. 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.
v. 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.
vi. 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: _____________________________
<PAGE>
ANNEX 2 TO EXHIBIT J
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: ______________________________
<PAGE>
Exhibit 1
<PAGE>
Exhibit 2
<PAGE>
EXHIBIT K
FORM OF CLASS R CERTIFICATE TRANSFER AFFIDAVIT
ASSET BACKED FUNDING CERTIFICATES, SERIES 1999-1
STATE OF )
) ss.:
COUNTY OF )
The undersigned, being first duly sworn, deposes and says as follows:
1. The undersigned is an officer of , the proposed Transferee of an
Ownership Interest in a Class R Certificate (the "Certificate") issued pursuant
to the Pooling and Servicing Agreement, (the "Agreement"), relating to the
above-referenced Certificates, among Asset Backed Funding Corporation, as
depositor, Credit-Based Asset Servicing and Securitization LLC, as seller,
Litton Loan Servicing LP, as servicer, and The Chase Manhattan Bank, as trustee
(the "Trustee"). Capitalized terms used, but not defined herein shall have the
meanings ascribed to such terms in the Agreement. The Transferee has authorized
the undersigned to make this affidavit on behalf of the Transferee.
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. (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.)
5. The Transferee has reviewed the provisions of Section 5.02(d) of the
Agreement and understands the legal consequences of the acquisition of an
Ownership Interest in the Certificate including, without limitation, the
restrictions on subsequent Transfers and the provisions regarding voiding the
Transfer and mandatory sales. The Transferee expressly agrees to be bound by and
to abide by the provisions of Section 5.02(d) 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 in this Exhibit K 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.
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 is not an employee benefit plan that is subject to
ERISA or a plan that is subject to Section 4975 of the Code, nor are we acting
on behalf of such a plan.
<PAGE>
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 , 19 .
[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 _________, 19__.
______________________________________
NOTARY PUBLIC
My Commission expires the ___ day
of ____________, 19__.
<PAGE>
EXHIBIT L
FORM OF TRANSFEROR CERTIFICATE
[DATE]
Asset Backed Funding Corporation
100 North Tryon Street
11th Floor
Charlotte, N.C. 28255
Re: Asset Backed Funding Certificates, Series 1999-1
------------------------------------------------
Ladies and Gentlemen:
In connection with our disposition of the Asset Backed Funding
Certificates, Series 1999-1 (the "Certficates"), we certify that (a) we
understand that the Certificates have not been registered under the Securities
Act of 1933, as amended (the "Act"), and are being disposed by us in a
transaction that is exempt from the registration requirements of the Act, (b) we
have not offered or sold any Certificates to, or solicited offers to buy any
Certificates from, any person, or otherwise approached or negotiated with any
person with respect thereto, in a manner that would be deemed, or taken any
other action which would result in, a violation of Section 5 of the Act, (c) to
the extent we are disposing of a Class [ ] Certificate, we have no knowledge the
Transferee is not a Permitted Transferee and (d) no purpose of the proposed
disposition of a Class [ ] Certificate is to impede the assessment or collection
of tax.
Very truly yours,
[_____________________]
By: ______________________________
<PAGE>
EXHIBIT M
[RESERVED]
<PAGE>
EXHIBIT N
DEPOSITORY AGREEMENT
<PAGE>
EXHIBIT O
FORM OF SERVICER REQUEST FOR REIMBURSEMENT
<PAGE>
EXHIBIT P
MONTHLY INFORMATION DELIVERED BY SERVICER
1. With respect to the Mortgage Pool and each Loan Group, the number and
Principal Balances of all Mortgage Loans which were the subject of
Principal Prepayments during the related Due Period.
2. With respect to the Mortgage Pool and each Loan Group, the amount of all
curtailments which were received during the related Due Period.
3. With respect to the Mortgage Pool and each Loan Group, the aggregate
amount of principal portion of all Monthly Payments received during the
related Due Period.
4. With respect to the Mortgage Pool and each Loan Group, the amount of
interest received on the Mortgage Loans during the related Due Period.
5. With respect to the Mortgage Pool and each Loan Group, the aggregate
amount of the Advances made and recovered with respect to such
Distribution Date.
6. With respect to the Mortgage Pool and each Loan Group, the delinquency and
foreclosure information and the amount of Mortgage Loan Losses during the
related Due Period.
7. With respect to the Mortgage Pool and each Loan Group, the weighted
average maturity, the weighted average Mortgage Interest Rate and the
weighted average Net Mortgage Interest Rate as of the last day of the Due
Period preceding of the related Accrual Period.
8. The Servicing Fees paid and Servicing Fees accrued during the related
Due Period.
9. The amount of all payments or reimbursements to the Servicer paid or to be
paid since the prior Distribution Date (or in the case of the first
Distribution Date, since the Closing Date).
10. The Pool Balance and aggregate Principal Balance for each Loan Group.
11. The PMI Fees paid and PMI Fees accrued during the related Due Period..
12. With respect to the Mortgage Pool and each Loan Group, the number of
Mortgage Loans outstanding at the beginning and at the end of the related
Due Period.
13. The aggregate interest accrued on the Mortgage Loans at their respective
Mortgage Interest Rates for the related Due Period.
14. The amount deposited in the Collection Account which may not be withdrawn
therefrom pursuant to an Order of a United States Bankruptcy Court of
competent jurisdiction imposing a stay pursuant to Section 362 of U.S.
Bankruptcy Code.
15. The aggregate Realized Losses since the Cut-off Date as of the end of
the related Due Period.
16. The LIBOR Carryover Amount for the Class A-1A Certificates, if any, with
respect to such Distribution Date.
17. The Overcollateralized Amount, the Targeted Overcollateralization Amount
and any Overcollateralization Deficiency, in each case after giving effect
to distributions on such Distribution Date.
<PAGE>
EXHIBIT Q
[RESERVED]
<PAGE>
EXHIBIT R
[RESERVED]
<PAGE>
EXHIBIT S
OFFICER'S CERTIFICATE WITH RESPECT TO PREPAYMENTS
Officer's Certificate
Asset Backed Funding Certificates, Series 1999-1
[Date]
Via Facsimile
The Chase Manhattan Bank, Trustee
450 West 33rd Street
14th Floor
New York, NY 10001
Re: Pre-Payments
Dear Sir or Madam:
__________________ hereby certifies that he/she is an officer of the
Servicer, holding the office set forth beneath his/her name and hereby further
certifies as follows:
With respect to the Mortgage Loans set forth in the attached schedule:
1. A Principal Prepayment in full was received during the related
Collection Period;
2. Any prepayment penalty due under the terms of the Mortgage Note with respect
to such Principal Prepayment in full was received from the mortgagor and
deposited in the Collection Account; ____ Yes ____ No
3. As to each Mortgage Loan so noted on the attached schedule, all or part of
the prepayment penalty required in connection with the Principal Prepayment
in full was waived based upon (Circle one): (i) the Servicer's determination
that such waiver would maximize recovery of Liquidation Proceeds for such
Mortgage Loan, taking into account the value of such prepayment penalty, or
(ii)(A) the enforceability thereof be limited (1) by bankruptcy insolvency,
moratorium, receivership, or other similar law relating to creditors' rights
generally or (2) due to acceleration in connection with a foreclosure or
other involuntary payment, or (B) the enforceability is otherwise limited or
prohibited by applicable law;
4. We certify that all amounts due in connection with the waiver of a prepayment
penalty inconsistent with number 3 above which are required to be deposited
by the Servicer pursuant to Section 3.01 of the Pooling and Servicing
Agreement, have been or will be so deposited.
Capitalized terms used herein shall have the meanings ascribed to such
terms in the Pooling and Servicing Agreement, dated November 1, 1999, among
Asset Backed Funding Corporation, as depositor, Credit-Based Asset Servicing and
Securitization LLC, as seller, Litton Loan Servicing LP, as servicer, and The
Chase Manhattan Bank, as trustee.
By: LITTON LOAN SERVICING LP
_______________________________
Name:
Title:
<PAGE>
EXHIBIT T
[RESERVED]
MGIC
MORTGAGE GUARANTY COMMITMENT/CERTIFICATE
- --------------------------------------------------------------------------------
Mortgage Guaranty Insurance Corporation (the "Company"), 250 E. Kilbourn
Avenue/P.O. Box 488 Milwaukee, Wisconsin 53201-0488, hereby agrees to pay to the
Insured any Loss due to the Default by a Borrower on the Loan identified below,
subject to the terms and conditions of the Master Policy, the conditions noted,
if any, and in reliance on the Insured's application for insurance.
- --------------------------------------------------------------------------------
Insured Litton Loan Servicing, LP
Mailing PO Box 4354
Address Houston, TX 77210-4354
<TABLE>
<CAPTION>
<S> <C>
Master Policy # 42-440-3-2096 /Total Amount Due $ See 1st billing
COMMITMENT/CERTIFICATE #See Attached /Initial Premium $ See 1st billing
Commitment Effective Date: December 1, 1999 /Amount of Loan Insured $53,082,696.00 in aggregate
Commitment Expiration Date: December 1, 1999 /Amount of Coverage: See list of Loans identified on Appendix A
</TABLE>
- --------------------------------------------------------------------------------
LOAN INFORMATION
Borrower Name: See List of Loans on Appendix A.
Property Address: See List of Loans on Appendix A for incorporation by
reference of all other Loan information referred to in this
section of the Commitment/Certificate.
Sale Price /
Appraised Value (Continued on following two pages) /Amortization Period
- --------------------------------------------------------------------------------
Initial Premium Description Annual Renewals %
- --------------------------------------------------------------------------------
COMPANY'S DECLARATION: The Company has obtained the above Loan information from
the Loan application and supporting documentation submitted by the Insured. The
company has relied on the Loan information being correct and true in extending
coverage to the Loan. The Company considers the Loan information to be
representations of the Insured which are material to the Company's acceptance of
the risk and to the hazard assumed.
- --------------------------------------------------------------------------------
INSURED CERTIFICATION: The undersigned certifies that the: 1) Loan transaction,
as described above, has been Consummated; 2) Loan information set forth above on
the Original Commitment/Certificate (C/C) is true and correct and the Company
can rely on it in extending coverage to the Loan; 3) Loan is not in Default at
the time the applicable premium is paid; 4) Conditions, if any, identified on
the Original C/C, have been satisfied; 5) Insured has attached to its retained
original C/C the insured Application and all supporting documentation and
representations submitted to the Company by or on behalf of the Insured; and 6)
Insured has no knowledge of any material changes in any statement contained in
such Application, supporting documentation or representations.
Any assignment of the servicing of the Loan or rights of the Insured under the
C/C must be in accordance with the terms and conditions of the Master Policy.
All capitalized terms herein shall have the same meaning set forth in the Master
Policy.
SERVICING SOLD? IF SO, COMPLETE THE SERVICING DATA BOX ON REMITTANCE COPY YOU
SEND TO MGIC.
- --------------------------------------------------------------------------------
Effective Date of Insured Loan Number Authorized Signature
Certificate of Insured
- --------------------------------------------------------------------------------
Form #71-7066 (2/94) Sign and keep this ORIGINAL DO NOT SEND TO MGIC.
COMMITMENT/CERTIFICATE
<PAGE>
The Company hereby insures a total of 731 loans, identified on the attached
Appendix A (individually a "Loan" or collectively the "Loans"), with an
aggregate Amount of Loan Insured (for all Loans) of $53,082,696.00 as identified
above. The Amount of Loan Insured and the Amount of Coverage for each individual
Loan are as shown on Appendix A.
The initial and renewal premium will be non-refundable and will be payable
monthly, at a monthly rate of 4.834 basis points (0.04834%) applied to the
outstanding principal balance of each Loan.
In issuing this Commitment/Certificate for the Loans, the Company relied upon
certain information and data received from the Insured; and C-Bass, including,
but not limited to information and data contained in several Internet file
transfers to the Company from C-Bass in December 1999, all of which will be
considered the "Application" for insurance of the Loans. For purposes of this
Commitment/Certificate, the relevant information contained in such Internet file
transfer shall be considered to be incorporated by reference in this
Commitment/Certificate.
This Commitment/Certificate is also subject to the terms and conditions of the
following Endorsements, which are applicable to all of the Loans:
(1) Master Reporting Program Endorsement -- MGIC Form #71-7139
(2) Subrogation Endorsement -- MGIC Form #71-7141
(3) Endorsement to Mortgage Guaranty Master Policy Litton Loan Serving,
LP --MGIC Form #71-70122
(4) Addendum For Texas -- MGIC Form #71-7151
(5) IMPORTANT NOTICE -- MGIC Form #71-20456
(6) Endorsement to Mortgage Guaranty Master Policy (Deferred Initial
Premium) --MGIC Form #71-70008
(7) Endorsement to Mortgage Guaranty Master Policy (Loans with Premium
Amount Included in the Loan's Principal Amount) -- MGIC Form
#71-70110
(8) Texas Amendatory Endorsement -- MGIC Form #71-7157
(9) Endorsement to Mortgage Guaranty Master Policy (Incontestability)
--MGIC Form #71-70007
The insured represents and warrants to the Company that:
(a) FICO Scores. Loans must have a valid original FICO Credit Score for
the primary wage earner as determined by a preferred repository
table, or the lower of two scores, or the middle of three scores with
the following minimums to be eligible for insurance:
Cashout or
Purchase and Investor or
LTV Rate/Term Second Homes
--- --------- ------------
97% 620 N/A
95% 601 N/A
90% 575 600
85% 550 575
80% 525 550
(b) CLTVs. The combined loan-to-value ratio ("CLTV") of an owner occupied
and second home, purchase and rate term refinances may not exceed
100%. LTV/CLTV limits as set forth in paragraph 8(a) above apply to
all other product.
(c) Loan Amounts. Loans may not have original principal balances greater
than the following:
LTV Loan
--- ----
97% $250,000
95% $300,000
90% $400,000
<80% $500,000
-
(d) Debt Ratios. Loans may not have a total debt ratio greater than 55%.
(e) Foreclosures and Bankruptcies. No borrower on any loan may have any
foreclosures in the last 18 months and all bankruptcies must have
been discharged at least 24 months ago.
(f) Delinquencies. Loans must be current (i.e., less than thirty days
delinquent) as of certificate effective date and no loan may have
more than 3x30 day mortgage lates in the last 12 months.
(g) Single Property. Loans may be secured by only one property.
(h) No Manufactured Homes. Loans may not be secured by multi-sectional/
manufactured homes (single or doublewides).
(i) 1-4s Only. Loans may be secured by 1-4 unit residential properties
only.
(j) Multiple Loans to Same Borrower. No more than two loans will be
insured with the same borrower (irrespective of other borrowers on
either loan).
<PAGE>
C-BASS / NATIONSCREDIT PORTFOLIO APPENDIX A
LIST OF LOANS FOR INSURANCE CERTIFICATION
- --------------------------------------------------------------------------------
58 B.P.
LENDER CURRENT LTV COVERAGE MONTHLY
LOAN NUMBER BALANCE LTV CATEGORY PERCENT PREMIUM
- --------------------------------------------------------------------------------
9533907 93,500.00 85.0 85 20 45.19
- --------------------------------------------------------------------------------
7001266001 18,764.00 93.8 95 30 9.07
- --------------------------------------------------------------------------------
7001266373 128,069.00 96.3 97 30 61.90
- --------------------------------------------------------------------------------
7001267843 47,717.00 78.2 80 15 23.06
- --------------------------------------------------------------------------------
7001295299 41,519.00 83.0 85 20 20.07
- --------------------------------------------------------------------------------
7001295414 51,099.00 95.9 97 30 24.70
- --------------------------------------------------------------------------------
7001340723 64,191.00 82.3 85 20 31.03
- --------------------------------------------------------------------------------
7001341549 49,291.00 82.7 85 20 23.82
- --------------------------------------------------------------------------------
7001343230 60,200.00 89.9 90 25 29.10
- --------------------------------------------------------------------------------
7001345946 50,393.00 81.3 85 20 24.36
- --------------------------------------------------------------------------------
7001345987 67,048.00 83.8 85 20 32.41
- --------------------------------------------------------------------------------
7001347371 53,996.00 83.1 85 20 26.10
- --------------------------------------------------------------------------------
7001359863 34,183.00 85.5 90 25 16.52
- --------------------------------------------------------------------------------
7001364905 65,435.00 93.5 95 30 31.63
- --------------------------------------------------------------------------------
7001364988 84,999.00 92.4 95 30 41.08
- --------------------------------------------------------------------------------
7001365530 244,419.00 85.8 90 25 118.14
- --------------------------------------------------------------------------------
7001365969 40,543.00 94.3 95 30 19.60
- --------------------------------------------------------------------------------
7001392310 33,683.00 78.3 80 15 16.28
- --------------------------------------------------------------------------------
7001393011 21,725.00 80.5 85 20 10.50
- --------------------------------------------------------------------------------
7001393037 67,847.00 83.8 85 20 32.79
- --------------------------------------------------------------------------------
7001437461 88,399.00 88.4 90 25 42.73
- --------------------------------------------------------------------------------
7001442347 38,976.00 88.6 90 25 18.84
- --------------------------------------------------------------------------------
7001445647 59,472.00 79.3 80 15 28.74
- --------------------------------------------------------------------------------
7001452387 39,185.00 91.1 95 30 18.94
- --------------------------------------------------------------------------------
7001454805 51,143.00 93.0 95 30 24.72
- --------------------------------------------------------------------------------
7001455430 53,497.00 86.3 90 25 25.86
- --------------------------------------------------------------------------------
7001458061 38,128.00 83.8 85 20 18.43
- --------------------------------------------------------------------------------
7001459101 55,120.00 78.7 80 15 26.64
- --------------------------------------------------------------------------------
7001459234 17,191.00 86.0 90 25 8.31
- --------------------------------------------------------------------------------
7001460257 38,998.00 77.2 80 15 18.85
- --------------------------------------------------------------------------------
7001463442 61,580.00 88.0 90 25 29.76
- --------------------------------------------------------------------------------
7001494413 80,197.00 87.2 90 25 38.76
- --------------------------------------------------------------------------------
7001529770 36,450.00 81.0 85 20 17.62
- --------------------------------------------------------------------------------
7001538359 66,192.00 88.3 90 25 31.99
- --------------------------------------------------------------------------------
7001538433 53,478.00 89.1 90 25 25.85
- --------------------------------------------------------------------------------
7001541379 70,200.00 90.0 90 25 33.93
- --------------------------------------------------------------------------------
7001541700 48,149.00 87.5 90 25 23.27
- --------------------------------------------------------------------------------
7001542443 172,246.00 87.0 90 25 83.25
- --------------------------------------------------------------------------------
7001542740 100,998.00 80.8 85 20 48.82
- --------------------------------------------------------------------------------
7001542781 79,713.00 94.9 95 30 38.53
- --------------------------------------------------------------------------------
7001542922 107,968.00 91.5 95 30 52.18
- --------------------------------------------------------------------------------
7001545560 55,002.00 88.7 90 25 26.58
- --------------------------------------------------------------------------------
7001545594 15,696.00 87.2 90 25 7.59
- --------------------------------------------------------------------------------
7001547541 73,310.00 86.3 90 25 35.43
- --------------------------------------------------------------------------------
7001548101 46,115.00 79.5 80 15 22.29
- --------------------------------------------------------------------------------
7001548846 92,303.00 87.9 90 25 44.61
- --------------------------------------------------------------------------------
7001581821 163,997.00 88.7 90 25 79.27
- --------------------------------------------------------------------------------
7001659049 71,795.00 78.0 80 15 34.70
- --------------------------------------------------------------------------------
7001670871 40,389.00 83.4 85 20 19.52
- --------------------------------------------------------------------------------
7001672059 88,766.00 84.5 85 20 42.90
- --------------------------------------------------------------------------------
7001673222 62,386.00 84.3 85 20 30.15
- --------------------------------------------------------------------------------
7001674105 56,405.00 88.1 90 25 27.26
- --------------------------------------------------------------------------------
7001675110 75,875.00 83.4 85 20 36.67
- --------------------------------------------------------------------------------
7001676282 54,421.00 82.5 85 20 26.30
- --------------------------------------------------------------------------------
7001676753 99,998.00 95.2 97 30 48.33
- --------------------------------------------------------------------------------
7001681985 37,898.00 82.4 85 20 18.32
- --------------------------------------------------------------------------------
7001682397 40,917.00 81.8 85 20 19.78
- --------------------------------------------------------------------------------
7001683114 31,837.00 79.6 80 15 15.39
- --------------------------------------------------------------------------------
7001683254 59,698.00 78.0 80 15 28.85
- --------------------------------------------------------------------------------
7001684195 111,000.00 88.8 90 25 53.65
- --------------------------------------------------------------------------------
7001684567 50,951.00 77.2 80 15 24.63
- --------------------------------------------------------------------------------
7001685374 44,623.00 82.6 85 20 21.57
- --------------------------------------------------------------------------------
7001688568 34,345.00 81.8 85 20 16.60
- --------------------------------------------------------------------------------
7001688618 25,588.00 91.4 95 30 12.37
- --------------------------------------------------------------------------------
7001689079 30,679.00 87.7 90 25 14.83
- --------------------------------------------------------------------------------
7001689087 32,678.00 83.8 85 20 15.79
- --------------------------------------------------------------------------------
7001689152 58,752.00 80.5 85 20 28.40
- --------------------------------------------------------------------------------
7001690226 68,595.00 80.7 85 20 33.15
- --------------------------------------------------------------------------------
7001690705 30,890.00 88.3 90 25 14.93
- --------------------------------------------------------------------------------
7001691604 78,746.00 77.6 80 15 38.06
- --------------------------------------------------------------------------------
7001692594 52,996.00 88.3 90 25 25.61
- --------------------------------------------------------------------------------
7001692685 43,871.00 89.5 90 25 21.20
- --------------------------------------------------------------------------------
7001696827 68,308.00 82.3 85 20 33.02
- --------------------------------------------------------------------------------
7001699219 81,649.00 82.5 85 20 39.46
- --------------------------------------------------------------------------------
7001699540 118,499.00 91.2 95 30 57.27
- --------------------------------------------------------------------------------
7001710297 172,000.00 80.0 80 15 83.13
- --------------------------------------------------------------------------------
7001715544 87,999.00 80.0 80 15 42.53
- --------------------------------------------------------------------------------
7001717938 31,600.00 80.0 80 15 15.27
- --------------------------------------------------------------------------------
7001752018 297,948.00 92.5 95 30 144.01
- --------------------------------------------------------------------------------
7001771018 52,631.00 80.4 85 20 25.44
- --------------------------------------------------------------------------------
7001772487 134,194.00 83.9 85 20 64.86
- --------------------------------------------------------------------------------
7001773352 86,599.00 85.7 90 25 41.86
- --------------------------------------------------------------------------------
7001774269 63,211.00 79.0 80 15 30.55
- --------------------------------------------------------------------------------
7001775290 63,859.00 87.5 90 25 30.87
- --------------------------------------------------------------------------------
7001779276 46,448.00 84.5 85 20 22.45
- --------------------------------------------------------------------------------
7001781959 69,075.00 89.7 90 25 33.39
- --------------------------------------------------------------------------------
7001782973 47,513.00 77.9 80 15 22.96
- --------------------------------------------------------------------------------
7001782981 65,798.00 77.0 80 15 31.80
- --------------------------------------------------------------------------------
7001783195 37,663.00 89.7 90 25 18.20
- --------------------------------------------------------------------------------
7001783344 48,299.00 80.5 85 20 23.34
- --------------------------------------------------------------------------------
7001784870 48,048.00 82.8 85 20 23.22
- --------------------------------------------------------------------------------
7001784888 53,295.00 89.0 90 25 25.76
- --------------------------------------------------------------------------------
7001785257 60,658.00 83.1 85 20 29.32
- --------------------------------------------------------------------------------
7001785331 43,116.00 84.5 85 20 20.84
- --------------------------------------------------------------------------------
7001785380 78,222.00 85.0 90 25 37.81
- --------------------------------------------------------------------------------
7001785406 24,876.00 82.9 85 20 12.02
- --------------------------------------------------------------------------------
7001785943 54,901.00 81.9 85 20 26.54
- --------------------------------------------------------------------------------
7001786115 83,954.00 84.0 85 20 40.58
- --------------------------------------------------------------------------------
7001787030 61,877.00 88.4 90 25 29.91
- --------------------------------------------------------------------------------
7001787220 55,204.00 82.8 85 20 26.68
- --------------------------------------------------------------------------------
7001788160 51,185.00 89.0 90 25 24.74
- --------------------------------------------------------------------------------
7001789325 94,363.00 84.3 85 20 45.61
- --------------------------------------------------------------------------------
7001789911 31,555.00 85.3 90 25 15.25
- --------------------------------------------------------------------------------
7001814149 69,368.00 96.3 97 30 33.53
- --------------------------------------------------------------------------------
7001818504 67,026.00 79.8 80 15 32.40
- --------------------------------------------------------------------------------
7001828776 93,552.00 85.1 90 25 45.22
- --------------------------------------------------------------------------------
7001828974 70,742.00 80.4 85 20 34.19
- --------------------------------------------------------------------------------
7001837306 53,496.00 89.2 90 25 25.86
- --------------------------------------------------------------------------------
7001837363 121,646.00 83.9 85 20 58.80
- --------------------------------------------------------------------------------
7001837447 70,558.00 80.2 85 20 34.10
- --------------------------------------------------------------------------------
7001838312 52,006.00 80.0 85 20 25.14
- --------------------------------------------------------------------------------
7001839856 37,796.00 82.2 85 20 18.27
- --------------------------------------------------------------------------------
7001841035 68,311.00 94.9 95 30 33.02
- --------------------------------------------------------------------------------
7001841167 37,738.00 78.6 80 15 18.24
- --------------------------------------------------------------------------------
7001841894 32,112.00 84.5 85 20 15.52
- --------------------------------------------------------------------------------
7001842207 60,647.00 80.9 85 20 29.31
- --------------------------------------------------------------------------------
7001844807 211,322.00 96.9 97 30 102.14
- --------------------------------------------------------------------------------
7001845457 49,913.00 90.8 95 30 24.12
- --------------------------------------------------------------------------------
7001846133 105,832.00 96.3 97 30 51.15
- --------------------------------------------------------------------------------
7001846257 46,583.00 80.3 85 20 22.52
- --------------------------------------------------------------------------------
7001846349 20,295.00 84.9 85 20 9.81
- --------------------------------------------------------------------------------
7001846356 104,398.00 94.9 95 30 50.46
- --------------------------------------------------------------------------------
7001848857 143,072.00 94.1 95 30 69.15
- --------------------------------------------------------------------------------
7001851281 57,929.00 85.2 90 25 28.00
- --------------------------------------------------------------------------------
7001852586 36,902.00 82.9 85 20 17.84
- --------------------------------------------------------------------------------
7001852610 256,997.00 85.7 90 25 124.22
- --------------------------------------------------------------------------------
7001853220 71,660.00 77.9 80 15 34.64
- --------------------------------------------------------------------------------
7001853717 32,903.00 78.5 80 15 15.90
- --------------------------------------------------------------------------------
7001854087 68,648.00 79.8 80 15 33.18
- --------------------------------------------------------------------------------
7001854137 42,155.00 81.1 85 20 20.37
- --------------------------------------------------------------------------------
7001855118 62,895.00 88.6 90 25 30.40
- --------------------------------------------------------------------------------
7001855183 63,189.00 84.3 85 20 30.54
- --------------------------------------------------------------------------------
7001855399 56,488.00 76.3 80 15 27.30
- --------------------------------------------------------------------------------
7001856652 35,000.00 76.1 80 15 16.92
- --------------------------------------------------------------------------------
7001857296 55,418.00 86.6 90 25 26.79
- --------------------------------------------------------------------------------
7001857585 22,841.00 84.6 85 20 11.04
- --------------------------------------------------------------------------------
7001994370 40,318.00 84.0 85 20 19.49
- --------------------------------------------------------------------------------
7001996425 79,209.00 86.1 90 25 38.28
- --------------------------------------------------------------------------------
7001996664 58,529.00 78.0 80 15 28.29
- --------------------------------------------------------------------------------
7001997258 69,549.00 89.2 90 25 33.62
- --------------------------------------------------------------------------------
7001999635 39,933.00 83.2 85 20 19.30
- --------------------------------------------------------------------------------
7001999999 67,047.00 78.9 80 15 32.41
- --------------------------------------------------------------------------------
7002000292 35,698.00 84.0 85 20 17.25
- --------------------------------------------------------------------------------
7002000474 78,232.00 82.4 85 20 37.81
- --------------------------------------------------------------------------------
7002000680 39,925.00 83.2 85 20 19.30
- --------------------------------------------------------------------------------
7002001084 69,921.00 80.4 85 20 33.80
- --------------------------------------------------------------------------------
7002001126 55,815.00 91.5 95 30 26.98
- --------------------------------------------------------------------------------
7002001357 30,905.00 79.2 80 15 14.94
- --------------------------------------------------------------------------------
7002004955 58,237.00 83.2 85 20 28.15
- --------------------------------------------------------------------------------
7002005739 69,999.00 87.5 90 25 33.83
- --------------------------------------------------------------------------------
7002006778 23,703.00 80.4 85 20 11.46
- --------------------------------------------------------------------------------
7002006869 64,894.00 90.1 95 30 31.37
- --------------------------------------------------------------------------------
7002008444 38,450.00 85.4 90 25 18.58
- --------------------------------------------------------------------------------
7002009103 35,137.00 89.0 90 25 16.98
- --------------------------------------------------------------------------------
7002009988 74,519.00 82.8 85 20 36.02
- --------------------------------------------------------------------------------
7002010374 50,340.00 88.3 90 25 24.33
- --------------------------------------------------------------------------------
7002012685 67,598.00 81.4 85 20 32.67
- --------------------------------------------------------------------------------
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731 53,082,696.00 25,656.64
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