EXHIBIT 99.1
EXECUTION COPY
INDYMAC ABS, INC.,
Depositor
INDYMAC, INC.
Seller and Master Servicer
and
THE BANK OF NEW YORK,
Trustee
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POOLING AND SERVICING AGREEMENT
Dated as of April 1, 2000
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HOME EQUITY MORTGAGE LOAN ASSET-BACKED TRUST,
SERIES SPMD 2000-A
HOME EQUITY MORTGAGE LOAN ASSET-BACKED CERTIFICATES,
SERIES SPMD 2000-A
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Table of Contents
Page
ARTICLE I
DEFINITIONS
ARTICLE II
CONVEYANCE OF MORTGAGE LOANS;
REPRESENTATIONS AND WARRANTIES
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Section 2.01. Conveyance of Mortgage Loans..................................................................1
Section 2.02. Acceptance by the Trustee of the Mortgage Loans...............................................6
Section 2.03. Representations, Warranties and Covenants of the Seller and the Master Servicer..............10
Section 2.04. Representations and Warranties of the Depositor as to the Mortgage Loans.....................12
Section 2.05. Delivery of Opinion of Counsel in Connection with Substitutions and Repurchases..............12
Section 2.06. Execution and Delivery of Certificates.......................................................13
Section 2.07. REMIC Matters................................................................................13
Section 2.08. Covenants of the Master Servicer.............................................................13
ARTICLE III
ADMINISTRATION AND SERVICING OF MORTGAGE LOANS
Section 3.01. Master Servicer to Service Mortgage Loans.....................................................1
Section 3.02. Subservicing; Enforcement of the Obligations of the Subservicers..............................2
Section 3.03. [Reserved]....................................................................................2
Section 3.04. No Contractual Relationship Between Subservicers and the Trustee..............................2
Section 3.05. Trustee to Act as Master Servicer.............................................................2
Section 3.06. Collection of Mortgage Loan Payments; Servicing Accounts; Collection Account;
Certificate Account; Distribution Account and Pre-Funding Accounts............................3
Section 3.07. Collection of Taxes, Assessments and Similar Items; Escrow Accounts...........................8
Section 3.08. Access to Certain Documentation and Information Regarding the Mortgage Loans..................8
Section 3.09. Permitted Withdrawals from the Certificate Account, the Distribution Account and the
Excess Reserve Fund Account...................................................................9
Section 3.10. Maintenance of Hazard Insurance; Maintenance of Primary Insurance Policies...................10
Section 3.11. Enforcement of Due-On-Sale Clauses; Assumption Agreements....................................12
Section 3.12. Realization Upon Defaulted Mortgage Loans; Repurchase of Certain Mortgage Loans..............13
Section 3.13. Trustee to Cooperate; Release of Mortgage Files..............................................16
Section 3.14. Documents, Records and Funds in Possession of the Master Servicer to be Held for the
Trustee......................................................................................17
Section 3.15. Servicing Compensation.18
Section 3.16. Access to Certain Documentation.18
Section 3.17. Annual Statement as to Compliance............................................................18
Section 3.18. Annual Independent Public Accountants' Servicing Statement; Financial Statements.............19
Section 3.19. Errors and Omissions Insurance; Fidelity Bonds...............................................19
ARTICLE IV
DISTRIBUTIONS AND ADVANCES BY THE MASTER SERVICER
Section 4.01. Advances......................................................................................1
Section 4.02. Priorities of Distribution....................................................................1
Section 4.03. Monthly Statements to Certificateholders......................................................4
Section 4.04. Interest Reserve Account......................................................................6
Section 4.05. [Reserved]....................................................................................6
Section 4.06. [Reserved]....................................................................................6
Section 4.07. Certain Matters Relating to the Determination of LIBOR........................................6
ARTICLE V
THE CERTIFICATES
Section 5.01. The Certificates..............................................................................1
Section 5.02. Certificate Register; Registration of Transfer and Exchange of Certificates...................1
Section 5.03. Mutilated, Destroyed, Lost or Stolen Certificates.............................................6
Section 5.04. Persons Deemed Owners.........................................................................6
Section 5.05. Access to List of Certificateholders' Names and Addresses.....................................6
Section 5.06. Maintenance of Office or Agency...............................................................7
ARTICLE VI
THE DEPOSITOR AND THE MASTER SERVICER
Section 6.01. Respective Liabilities of the Depositor and the Master Servicer...............................1
Section 6.02. Merger or Consolidation of the Depositor or the Master Servicer...............................1
Section 6.03. Limitation on Liability of the Depositor, the Seller, the Master Servicer and Others..........1
Section 6.04. Limitation on Resignation of the Master Servicer..............................................2
ARTICLE VII
DEFAULT
Section 7.01. Events of Default.............................................................................1
Section 7.02. Trustee to Act; Appointment of Successor......................................................2
Section 7.03. Notification to Certificateholders............................................................3
ARTICLE VIII
CONCERNING THE TRUSTEE
Section 8.01. Duties of the Trustee.........................................................................1
Section 8.02. Certain Matters Affecting the Trustee.........................................................2
Section 8.03. Trustee Not Liable for Certificates or Mortgage Loans.........................................3
Section 8.04. Trustee May Own Certificates..................................................................3
Section 8.05. Trustee's Fees and Expenses...................................................................3
Section 8.06. Eligibility Requirements for the Trustee......................................................4
Section 8.07. Resignation and Removal of the Trustee........................................................4
Section 8.08. Successor Trustee.............................................................................5
Section 8.09. Merger or Consolidation of the Trustee........................................................5
Section 8.10. Appointment of Co-Trustee or Separate Trustee.................................................5
Section 8.11. Tax Matters...................................................................................7
Section 8.12. Periodic Filings..............................................................................9
Section 8.13. Corresponding Classes.........................................................................9
ARTICLE IX
TERMINATION
Section 9.01. Termination upon Liquidation or Purchase of the Mortgage Loans................................1
Section 9.02. Final Distribution on the Certificates........................................................1
Section 9.03. Additional Termination Requirements...........................................................2
ARTICLE X
MISCELLANEOUS PROVISIONS
Section 10.01. Amendment.....................................................................................1
Section 10.02. Recordation of Agreement; Counterparts........................................................2
Section 10.03. Governing Law.................................................................................2
Section 10.04. Intention of Parties..........................................................................3
Section 10.05. Notices.......................................................................................3
Section 10.06. Severability of Provisions....................................................................4
Section 10.07. Assignment....................................................................................4
Section 10.08. Limitation on Rights of Certificateholders....................................................4
Section 10.09. Inspection and Audit Rights...................................................................5
Section 10.10. Certificates Nonassessable and Fully Paid.....................................................5
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SCHEDULES
Schedule I: Mortgage Loan Schedule.................................................................... S-I-1
Schedule II: Representations and Warranties of the
Seller/Master Servicer.................................................................... S-II-1
Schedule III: Representations and Warranties as to
the Mortgage Loans........................................................................S-III-1
Schedule IV: Planned Balanced Schedules.................................................................S-IV-1
EXHIBITS
Exhibit A: Form of Class A, M and B Certificate..........................................................A-1
Exhibit B: Form of Class BB Certificate..................................................................B-1
Exhibit C: Form of Class R Certificate...................................................................C-1
Exhibit D: Form of Class X Certificate...................................................................D-1
Exhibit E: Form of Reverse of Certificates...............................................................E-1
Exhibit F: [Reserved]....................................................................................F-1
Exhibit G: Form of Initial Certification of Trustee......................................................G-1
Exhibit H: Form of Final Certification of Trustee........................................................H-1
Exhibit I: Form of Transfer Affidavit....................................................................I-1
Exhibit J: Form of Transferor Certificate................................................................J-1
Exhibit K: [Reserved]....................................................................................K-1
Exhibit L: Form of Rule 144A Letter......................................................................L-1
Exhibit M: Form of Request for Release (for Trustee).....................................................M-1
Exhibit N: Form of Request for Release (Mortgage Loan
Paid in Full, Repurchased and Released).......................................................N-1
Exhibit O: [Reserved]....................................................................................O-1
Exhibit Q: Form of Subsequent Transfer Agreement.........................................................Q-1
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THIS POOLING AND SERVICING AGREEMENT, dated as of April 1, 2000,
among INDYMAC ABS, INC., a Delaware corporation, as depositor (the
"Depositor"), INDYMAC, INC. ("IndyMac"), a Delaware corporation, as seller (in
such capacity, the "Seller") and as master servicer (in such capacity, the
"Master Servicer"), and THE BANK OF NEW YORK, a banking corporation organized
under the laws of the State of New York, as trustee (the "Trustee"),
WITNESSETH THAT
In consideration of the mutual agreements herein contained, the
parties hereto agree as follows:
PRELIMINARY STATEMENT
The Trustee shall elect that the Trust Fund be treated for federal
income tax purposes as comprising two REMICs (each a "REMIC" or, in the
alternative, the Lower Tier REMIC and the Upper Tier REMIC, respectively).
Each Certificate, other than the Class R Certificate and the Class BB
Certificate, represents ownership of a regular interest in the Upper Tier
REMIC for purposes of the REMIC Provisions. The Class R Certificate represents
ownership of the sole class of residual interest in each of the Lower Tier
REMIC and the Upper Tier REMIC for purposes of the REMIC Provisions. The
Startup Day for each REMIC described herein is the Closing Date. The latest
possible maturity date for each Certificate is the latest date referenced in
Section 9.01. The Upper Tier REMIC shall hold as assets the several classes of
uncertificated Lower Tier Regular Interests, set out below. Each such Lower
Tier Regular Interest is hereby designated as a regular interest in the Lower
Tier REMIC.
Lower Tier Class Initial Lower Tier
Designation Lower Tier Interest Rate Principal Amount
Class LT-C (1) $60,998,045.00
Class LT-AF-1 (1) 19,000,000.00
Class LT-AF-2 (1) 19,500,000.00
Class LT-AF-3 (1) 14,986,500.00
Class LT-MF-1 (1) 2,103,500.00
Class LT-MF-2 (1) 1,803,000.00
Class LT-BF (1) 1,803,000.00
Class LT-D (2) 79,144,455.00
Class LT-AV-1 (2) 63,310,000.00
Class LT-MV-1 (2) 4,063,500.00
Class LT-MV-2 (2) 3,870,000.00
Class LT-BV (2) 5,418,000.00
Class LT-E (1) 100
Class LT-R (3) (3)
(1) The interest rate with respect to any Distribution Date for these
interests is a per annum variable rate equal to the Group 1 WAC Cap.
(2) The interest rate with respect to any Distribution Date for these
interests is a per annum variable rate equal to the Group 2 WAC Cap.
(3) The Class LT-R Interest is the sole class of residual interest in the
Lower Tier REMIC and it does not have a principal amount or an interest
rate.
The Lower Tier REMIC shall hold as assets all of the assets included
in the Trust Fund other than the Group 1 Pre-Funding Account, the Group 2
Pre-Funding Account, the Group 1 Capitalized Interest Account, the Group 2
Capitalized Interest Account, the Excess Reserve Fund Account, and the Lower
Tier Regular Interests.
With respect to any Distribution Date, interest that accrues on the
Class LT-C Interest will be deferred and added to the principal balance of the
Class LT-C Interest in an amount equal to 50% of any increase in the
Subordinated Amount for the Group 1Certificates for such Distribution Date.
With respect to any Distribution Date, interest that accrues on the
Class LT-D Interest will be deferred and added to the principal balance of the
Class LT-D Interest in an amount equal to 50% of any increase in the
Subordinated Amount for the Group 2 Certificates for such Distribution Date.
With respect to any Distribution Date, principal shall be
distributed to and losses shall be allocated among the Lower Tier Regular
Interests in a manner such that, immediately following such Distribution Date,
the principal balance of each of the Class LT-AF-1, Class LT-AF-2, Class
LT-AF-3, Class LT-MF-1, Class LT-MF-2, Class LT-BF, Class LT-AV-1, Class
LT-MV-1, Class LT-MV-2, and Class LT-BV Interests equals 50% of its
Corresponding Class of Upper Tier REMIC Regular Interest.
The Upper Tier REMIC shall issue the following classes of interests
and each Upper Tier Interest, other than the Class UT-R Interest, is hereby
designated as a regular interest in the Upper Tier REMIC.
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Upper Tier Class Upper Tier Interest Initial Upper Tier Corresponding
Designation Rate Principal Amount Certificate
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Class AF-1 (1) $38,000,000 Class AF-1 (9)
Class AF-2 (2) $39,000,000 Class AF-2
Class AF-3 (2) $29,973,000 Class AF-3
Class MF-1 (2) $4,207,000 Class MF-1
Class MF-2 (2) $3,606,000 Class MF-2
Class BF (2) $3,606,000 Class BF
Class AV-1 (3) $124,620,000 Class AV (9)
Class MV-1 (3) $8,127,000 Class MV-1 (9)
Class MV-2 (3) $7,740,000 Class MV-2
(9)
Class BV (3) $10,836,000 Class BV (9)
Class XF (4) (4) Class X(6)
Class XV (5) (5) Class X(6)
Class UT-R (7) 100 Class R
Class BB (8)
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(1) The Class AF-1 Interests will bear interest during their initial Interest
Accrual Period at 6.5395% per annum. The Class AF-1 Interests will bear
interest during each Interest Accrual Period thereafter at a per annum
rate equal to the lesser of (i) LIBOR plus 0.20% and (ii) the product of
the Group 1 WAC Cap and a fraction, the numerator of which is 30 and the
denominator of which is the actual number of days in the immediately
preceding calendar month. Following the Optional Termination Date, the
Pass-Through Margin for the Class AF-1 Certificates shall be doubled.
(2) With respect to any Distribution Date, the rate at which interest is
payable on these interests will be the lesser of the rate shown above or
the Group 1 WAC Cap. Following the Optional Termination Date, the stated
per annum Pass-Through Rates shown above will increase by 0.50% (50 basis
points).
(3) The Class AV-1, Class MV-1, Class MV-2 and Class BV Interests will bear
interest during their initial Interest Accrual Period at 6.6020%,
6.9564%, 7.4263% and 8.5261%, respectively, per annum. The Class AV-1,
Class MV-1, Class MV-2 and Class BV Interests will bear interest during
each Interest Accrual Period thereafter at a per annum rate equal to the
least of (i) LIBOR plus 0.26%, 0.60%, 1.05% and 2.10%, respectively, (ii)
the Group 2 Maximum Cap, and (iii) the Group 2 WAC Cap. Following the
Optional Termination Date, the Pass-Through Margin for the Class AV-1
Certificates shall be doubled and the Pass-Through Margin for Group 2
Subordinated Certificates shall increase by 1.5 times.
(4) The Class XF Interest has an initial principal balance of $1,802,045, but
it will not accrue interest on such balance but will accrue interest on a
notional principal balance. As of any Distribution Date, the Class XF
Interest shall have a notional principal balance equal to the aggregate
of the principal balances of the Lower Tier Fixed Rate Regular Interests,
other than the Class LT-E interest, as of the first day of the related
Interest Accrual Period. With respect to any Interest Accrual Period, the
Class XF Interest shall bear interest at a rate equal to the excess, if
any, of the Group 1 WAC Cap over the product of (i) 2 and (ii) the
Adjusted Lower Tier Fixed Rate WAC. With respect to any Distribution
Date, interest that so accrues on the notional balance of the Class XF
Interest shall be deferred in an amount equal to any increase in the
Subordinated Amount for the Group 1 Certificates on such Distribution
Date. Such deferred interest shall not itself bear interest.
(5) The Class XV Interest has an initial principal balance of $3,482,955,
but it will not accrue interest on such balance but will accrue
interest on a notional principal balance. As of any Distribution
Date, the Class XV Interest shall have a notional principal balance
equal to the aggregate of the principal balances of the Lower Tier
Adjustable Rate Regular Interests as of the first day of the related
Interest Accrual Period. With respect to any Interest Accrual Period,
the Class XV Interest shall bear interest at a rate equal to the
excess, if any, of the Group 2 WAC Cap over the product of (i) 2 and
(ii) the Adjusted Lower Tier Adjustable Rate WAC. With respect to any
Distribution Date, interest that so accrues on the notional balance
of the Class XV Interest shall be deferred in an amount equal to any
increase in the Subordinated Amount for the Group 2 Certificates on
such Distribution Date. Such deferred interest shall not itself bear
interest.
(6) The Class XF and the Class XV Interests are non-severable components of
the Class X Certificate.
(7) The Class UT-R Interest is the sole class of residual interest in the
Upper Tier REMIC. The interest rate with respect to any Distribution
Date for Class UT-R is a per annum variable rate equal to the Group 1
WAC Cap.
(8) The Class BB Certificate is not an interest in the Lower Tier REMIC
or the Upper Tier REMIC. For federal income tax purposes, the Trustee
will treat the Class BB Certificate as a nonrecourse obligation of
the Class X Certificateholder. The Class BB Certificate shall have an
initial principal balance of $10,631,311.42 and shall bear interest
at a Pass-Through Rate of 8.00%.
(9) Each of these Certificates will represent not only the ownership of
the Corresponding Class of Upper Tier Regular Interest but also the
right to receive payments from the Excess Reserve Fund Account in
respect of any Basis Risk CarryForward Amounts. For federal income
tax purposes, the Trustee will treat a Certificateholder's right to
receive payments from the Excess Reserve Fund Account as payments
made pursuant to an interest rate cap contract written by the Class X
Certificateholder.
The minimum denomination for each Class of Certificates, other than
the Class R, the Class X and the Class BB Certificates, will be $25,000. The
minimum denominations for the Class BB Certificates will be $100,000 and
increments of $1,000 in excess thereof, except for one certificate which may
be issued in a different denomination. The Class R and the Class X
Certificates will each represent a 100% Percentage Interest in such class.
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Set forth below are designations of Classes of Certificates to the
categories used herein:
Book-Entry Certificates............... All Classes of Certificates other
than the Physical Certificates.
Group 1
Certificates........................ Class AF-1, Class AF-2, Class AF-3,
Class MF-1, Class MF-2, Class BF and
Class R Certificates.
Group 2
Certificates........................ Class AV-1, Class MV-1, Class MV-2
and Class BV Certificates.
Group 1
Class A Certificates................ Class AF-1, Class AF-2 and Class
AF-3 Certificates.
Group 2
Class A Certificates................ Class AV-1 Certificates.
Group 1
Mezzanine Certificates.............. Class MF-1 and Class
MF-2 Certificates.
Group 2
Mezzanine Certificates.............. Class MV-1 and Class
MV-2 Certificates.
Group 1
Subordinated Certificates........... Group 1 Mezzanine Certificates
and Class BF Certificates.
Group 2
Subordinated Certificates........... Group 2 Mezzanine Certificates
and Class BV Certificates.
Adjustable Rate Certificates.......... Class AF-1 Certificates
and the Group 2 Certificates.
Fixed Rate Certificates............... Class AF-2, Class AF-3,
Class MF-1, Class MF-2 and
Class BF Certificates.
Delay Certificates.................... All interest-bearing Classes of
Certificates other than the
Non-Delay Certificates, if any.
ERISA-Restricted
Certificates........................ Subordinated Certificates, Class R
Certificates, Class BB Certificate
and Class X Certificate.
Floating Rate Certificates............ Adjustable Rate Certificates.
LIBOR Certificates.................... Adjustable Rate Certificates.
Mezzanine Certificates................ Class MF-1, Class MF-2, Class MV-1
and Class MV-2 Certificates.
Non-Delay Certificates................ Adjustable Rate Certificates.
Offered Certificates.................. All Classes of Certificates other
than the Private Certificates.
Physical Certificates................. Class BB, Class X and Class R
Certificates.
Private Certificates.................. Class BB Certificate and Class X
Certificate.
Rating Agencies....................... S&P and Fitch.
Regular Certificates.................. All Classes of Certificates other
than the Class R and Class BB
Certificates.
Residual Certificates................. Class R Certificates.
Subordinated Certificates............. Mezzanine Certificates, Class BF
Certificates and Class BV
Certificates.
References herein to "Class A," "Class M-1," "Class M-2," "Class B,"
"Mezzanine Certificates" and "Subordinated Certificates" are references to
Certificates of either or both Certificate Groups of similar designations, as
the context requires.
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ARTICLE I
DEFINITIONS
Whenever used in this Agreement, the following words and phrases,
unless the context otherwise requires, shall have the following meanings:
Accrued Certificate Interest Distribution Amount: With respect to
any Distribution Date for each Class of Certificates (other than the Class X
Certificate), the amount of interest accrued during the related Interest
Accrual Period at the applicable Pass-Through Rate on the related Class
Certificate Balance immediately prior to such Distribution Date.
Adjusted Lower Tier Adjustable Rate WAC: With respect to any
Interest Accrual Period, the weighted average of the interest rates on the
Lower Tier Adjustable Rate Regular Interests determined for this purpose by
first subjecting the rate payable on the Class LT-D Interest to a cap of zero
and subjecting the rate payable on each of the Class LT-AV-1, Class LT-MV-1,
Class LT-MV-2, and Class LT-BV Interests to a cap equal to LIBOR plus the
Margin that corresponds to the Pass-Through Margin used in computing the
Pass-Through Rate on the Corresponding Class of Certificates.
Adjusted Lower Tier Fixed Rate WAC: With respect to any Interest
Accrual Period, the weighted average of the interest rates on the Lower Tier
Fixed Rate Regular Interests determined for this purpose by first subjecting
the rate payable on the Class LT-C Interest to a cap of zero, subjecting the
rate payable on the Class LT-AF-1 Interest to a cap equal to LIBOR plus the
Pass-Through Margin for the Class AF-1 Certificates, and subjecting the rate
payable on each of the Class LT-AF-2, Class LT-AF-3, Class LT-MF-1, Class
LT-MF-2, and Class LT-BF Interests to a cap that corresponds to the
Pass-Through Rate payable on the Corresponding Class of Certificates.
Adjusted Mortgage Rate: As to each Mortgage Loan and at any time,
the per annum rate equal to the Mortgage Rate less the Master Servicing Fee
Rate.
Adjusted Net Mortgage Rate: As to each Mortgage Loan and at any
time, the per annum rate equal to the Mortgage Rate less the Expense Fee Rate.
Adjustment Date: As to any Mortgage Loan in Loan Group 2, the first
Due Date on which the related Mortgage Rate adjusts as set forth in the
related Mortgage Note and each Due Date thereafter on which the Mortgage Rate
adjusts as set forth in the related Mortgage Note.
Advance: As to a Loan Group, the payment required to be made by the
Master Servicer with respect to any Distribution Date pursuant to Section
4.01, the amount of any such payment being equal to the aggregate of payments
of principal and interest (net of the Master Servicing Fee and net of any net
income in the case of any REO Property) on the Mortgage Loans in such Loan
Group that were due during the related Remittance Period and not received as
of the close of business on the related Determination Date, less the aggregate
amount of any such delinquent payments that the Master Servicer has determined
would constitute a Nonrecoverable Advance if advanced.
Agreement: This Pooling and Servicing Agreement and all amendments
or supplements hereto.
Amount Held for Future Distribution: As to the Certificates in
either Certificate Group on any Distribution Date, the aggregate amount held
in the Certificate Account at the close of business on the related
Determination Date on account of (i) Principal Prepayments and Liquidation
Proceeds on the Mortgage Loans in the related Loan Group received after the
end of the related Remittance Period and (ii) all Scheduled Payments on the
Mortgage Loans in the related Loan Group due after the end of the related
Remittance Period.
Applied Realized Loss Amount: With respect to any Distribution Date,
the amount, if any, by which, (i) with respect to the Group 1 Certificates,
the aggregate Class Certificate Balance of the Group 1 Certificates after
distributions of principal on such Distribution Date exceeds the aggregate
Stated Principal Balance of the Mortgage Loans in Loan Group 1 as of the last
day of the immediately preceding Remittance Period plus the amount in the
related Pre-Funding Account, if any, excluding investment earnings, and (ii)
with respect to the Group 2 Certificates, the aggregate Class Certificate
Balance of the Group 2 Certificates after distributions of principal on such
Distribution Date exceeds the aggregate Stated Principal Balance of the
Mortgage Loans in Loan Group 2 as of the last day of the immediately preceding
Remittance Period plus the amount in the related Pre-Funding Account, if any.
Available Funds: With respect to any Distribution Date and the
Mortgage Loans in a Loan Group (x) the sum of (i) all scheduled installments
of interest (net of the related Expense Fees) and principal due on the Due
Date on such Mortgage Loans in the related Remittance Period and received
prior to the related Determination Date, together with any Advances in respect
thereof; (ii) all Insurance Proceeds and Liquidation Proceeds during the
related Remittance Period (in each case, net of unreimbursed expenses incurred
in connection with a liquidation or foreclosure and unreimbursed Advances, if
any); (iii) all partial or full prepayments on the Mortgage Loans in such Loan
Group received during the related Remittance Period together with all
Compensating Interest thereon; (iv) the related Unutilized Pre-Funding Amount;
(v) the related Capitalized Interest Requirement and (vi) amounts received
with respect to such Distribution Date as the Substitution Adjustment Amount
or purchase price in respect of a Deleted Mortgage Loan in such Loan Group or
a Mortgage Loan repurchased by the Seller or the Master Servicer in such Loan
Group as of such Distribution Date; reduced by (y) (i) amounts in
reimbursement for Advances previously made with respect to the Mortgage Loans
in such Loan Group and other amounts as to which the Master Servicer is
entitled to be reimbursed pursuant to the Agreement with respect to such Loan
Group and (ii) the Trustee's Fee allocated to such Loan Group.
Basic Principal Distribution Amount: With respect to any
Distribution Date and Loan Group, the excess of (i) the related Principal
Remittance Amount for such Distribution Date over (ii) the related Excess
Subordinated Amount, if any, for such Distribution Date.
Basis Risk CarryForward Amount: With respect to (a) the Class AF-1
Certificates, as of any Distribution Date, the sum of (A) if on such
Distribution Date the Pass-Through Rate for the Class AF-1 Certificates is
based upon the Group 1 WAC Cap, the excess of (i) the amount of interest the
Class AF-1 Certificates would otherwise be entitled to receive on such
Distribution Date had such rate been calculated as the sum of LIBOR and the
applicable Pass-Through Margin for the Class AF-1 Certificates for such
Distribution Date, over (ii) the amount of interest payable on the Class AF-1
Certificates at the Group 1 WAC Cap for such Distribution Date and (B) the
related Basis Risk CarryForward Amount for all previous Distribution Dates not
previously paid, together with interest thereon at a rate equal to the sum of
LIBOR and the applicable Pass-Through Margin for the Class AF-1 Certificates
for such Distribution Date and (b) each Class of Group 2 Certificates, as of
any Distribution Date, the sum of (A) if on such Distribution Date the
Pass-Through Rate for any Class of Group 2 Certificates is based upon the
Group 2 WAC Cap, the excess of (i) the amount of interest such Class of Group
2 Certificates would otherwise be entitled to receive on such Distribution
Date had such rate been calculated as the sum of LIBOR and the applicable
Pass-Through Margin on such Class of Group 2 Certificates for such
Distribution Date, up to the Group 2 Maximum Cap over (ii) the amount of
interest payable on such Class of Group 2 Certificates at the Group 2 WAC Cap
for such Distribution Date and (B) the Basis Risk CarryForward Amount for such
Class of Group 2 Certificates for all previous Distribution Dates not
previously paid, together with interest thereon at a rate equal to the sum of
LIBOR and the applicable Pass-Through Margin for such Class of Group 2
Certificates for such Distribution Date, subject to the Group 2 Maximum Cap.
Basis Risk Payment: For any Distribution Date, an amount equal to
the sum of (i) any Basis Risk CarryForward Amount and (ii) the Required
Reserve Amount for that date, provided, however, that with respect to any
Distribution Date, the payment cannot exceed the sum of the amounts otherwise
distributable on the Class BB and Class X Certificates.
Blanket Mortgage: The mortgage or mortgages encumbering a
Cooperative Property.
Book-Entry Certificates: As specified in the Preliminary Statement.
Business Day: Any day other than (i) a Saturday or a Sunday, or (ii)
a day on which banking institutions in the City of New York, New York, or the
State of California or 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.
Capitalized Interest Account: Either of the Group 1 Capitalized
Interest Account or the Group 2 Capitalized Interest Account.
Capitalized Interest Requirement: With respect to the Distribution
Date in May and June 2000 and Loan Group 1, the excess of (1) the product of
(a) the excess of the Pre-Funding Amount for Loan Group 1 on the Closing Date
over the Principal Balance of any Subsequent Mortgage Loan transferred to the
Trust Fund for Loan Group 1 during the related Due Period or a prior Due
Period that has a Monthly Payment due during such Due Period and (b) a
fraction, the numerator of which is the weighted average of the Pass-Through
Rates on the Group 1 Certificates for such Distribution Date and the
denominator of which is 12 over (2) the investment earnings on the amounts on
deposit in the Group 1 Capitalized Interest Account and the Group 1
Pre-Funding Account. With respect to the Distribution Date in May and June
2000 and Loan Group 2, the excess of (1) the product of (a) the excess of the
Pre-Funding Amount for Loan Group 2 on the Closing Date over the Principal
Balance of any Subsequent Mortgage Loan transferred to the Trust Fund for Loan
Group 2 during the related Due Period or a prior Due Period that has a Monthly
Payment due during such Due Period and (b) a fraction, the numerator of which
is the weighted average of the Pass-Through Rates on the Group 2 Certificates
for such Distribution Date and the denominator of which is 12 over (2) the
investment earnings on the amounts on deposit in the Group 2 Capitalized
Interest Account and the Group 2 Pre-Funding Account.
Certificate: Any one of the Certificates executed by the Trustee in
substantially the forms attached hereto as exhibits.
Certificate Account: The separate Eligible Account or Accounts
created and maintained by the Master Servicer pursuant to Section 3.06(c) with
a depository institution in the name of the Master Servicer for the benefit of
the Trustee on behalf of Certificateholders and designated "IndyMac, Inc. in
trust for the registered holders of Home Equity Mortgage Loan Asset-Backed
Certificates, Series SPMD 2000-A".
Certificate Balance: With respect to any Class of Certificates,
other than the Class X Certificate, at any date, the maximum dollar amount of
principal to which the Holder thereof is then entitled hereunder, such amount
being equal to the Denomination thereof minus all distributions of principal
previously made with respect thereto and in the case of any Subordinated
Certificates, reduced by any Applied Realized Loss Amounts applicable to such
Class of Subordinated Certificates. The Class X Certificate has no Certificate
Balance.
Certificate Group: Any of the Certificate Group 1 Certificates or
the Certificate Group 2 Certificates, as applicable.
Certificate Owner: With respect to a Book-Entry Certificate, the
Person who is the beneficial owner of such Book-Entry Certificate.
Certificate Register: The register maintained pursuant to Section
5.02.
Certificateholder or Holder: The person in whose name a Certificate
is registered in the Certificate Register, except that, solely for the purpose
of giving any consent pursuant to this Agreement, any Certificate registered
in the name of the Depositor or any affiliate of the Depositor shall be deemed
not to be Outstanding and the Percentage Interest evidenced thereby shall not
be taken into account in determining whether the requisite amount of
Percentage Interests necessary to effect such consent has been obtained;
provided, however, that if any such Person (including the Depositor) owns 100%
of the Percentage Interests evidenced by a Class of Certificates, such
Certificates shall be deemed to be Outstanding for purposes of any provision
hereof that requires the consent of the Holders of Certificates of a
particular Class as a condition to the taking of any action hereunder. The
Trustee is entitled to rely conclusively on a certification of the Depositor
or any affiliate of the Depositor in determining which Certificates are
registered in the name of an affiliate of the Depositor.
Class: All Certificates bearing the same class designation as set
forth in the Preliminary Statement.
Class A Principal Distribution Amount: With respect to each Loan
Group and any Distribution Date, the excess of (i) the aggregate Class
Certificate Balance of the Class A Certificates for the related Certificate
Group immediately prior to such Distribution Date over (ii) the lesser of (A)
78.00% for Loan Group 1 and 61.00% for Loan Group 2, of the aggregate Stated
Principal Balance of the Mortgage Loans in the related Loan Group as of the
last day of the related Remittance Period and (B) the Stated Principal
Balances of the Mortgage Loans in the related Loan Group as of the last day of
the related Remittance Period minus $600,970.23 with respect to Loan Group 1
and $774,029.78 with respect to Loan Group 2.
Class B Principal Distribution Amount: With respect to each Loan
Group and any Distribution Date, the excess of (i) the sum for the related
Certificate Group of (A) the aggregate Class Certificate Balance of the Class
A Certificates (after taking into account distribution of the Class A
Principal Distribution Amount on such Distribution Date), (B) the Class
Certificate Balance of the Class M-1 Certificates (after taking into account
distribution of the Class M-1 Principal Distribution Amount on such
Distribution Date), (C) the Class Certificate Balance of the Class M-2
Certificates (after taking into account distribution of the Class M-2
Principal Distribution Amount for such Distribution Date), and (D) the Class
Certificate Balance of the Class B Certificates immediately prior to such
Distribution Date over (ii) the lesser of (A) 97.00% for Loan Group 1 and
95.50% for Loan Group 2, of the aggregate Stated Principal Balance of the
Mortgage Loans in the related Loan Group as of the last day of the related
Remittance Period and (B) the Stated Principal Balances of the Mortgage Loans
in the related Loan Group as of the last day of the related Remittance Period
minus $600,970.23 with respect to Loan Group 1 and $774,029.78 with respect to
Loan Group 2, provided, however, that with respect to any Distribution Date on
which the Class Certificate Balances of the related Class A, Class M-1 and
Class M-2 Certificates have been reduced to zero, the Class B Principal
Distribution Amount is the lesser of (x) the Class Certificate Balance of the
Class B Certificates and (y) the related Principal Distribution Amount.
Class Certificate Balance: With respect to any Class and as to any
date of determination, the aggregate of the Certificate Balances of all
Certificates of such Class as of such date.
Class M-1 Principal Distribution Amount: With respect to each Loan
Group and any Distribution Date, the excess of (i) the sum for the related
Certificate Group of (A) the aggregate Class Certificate Balance of the Class
A Certificates (after taking into account distribution of the Class A
Principal Distribution Amount on such Distribution Date), and (B) the Class
Certificate Balance of the Class M-1 Certificates immediately prior to such
Distribution Date over (ii) the lesser of (A) 85.00% for Loan Group 1 and
71.50% for Loan Group 2, of the aggregate Stated Principal Balance of the
Mortgage Loans in the related Loan Group as of the last day of the related
Remittance Period and (B) the Stated Principal Balances of the Mortgage Loans
in the related Loan Group as of the last day of the related Remittance Period
minus $600,970.23 with respect to Loan Group 1 and $774,029.78 with respect to
Loan Group 2.
Class M-2 Principal Distribution Amount: With respect to each Loan
Group and any Distribution Date, the excess of (i) the sum for the related
Certificate Group of (A) the aggregate Class Certificate Balance of the Class
A Certificates (after taking into account distribution of the Class A
Principal Distribution Amount on such Distribution Date), (B) the Class
Certificate Balance of the Class M-1 Certificates (after taking into account
distribution of the Class M-1 Principal Distribution Amount on such
Distribution Date) and (C) the Class Certificate Balance of the Class M-2
Certificates immediately prior to such Distribution Date over (ii) the lesser
of (A) 91.00% for Loan Group 1 and 81.50% for Loan Group 2, of the aggregate
Stated Principal Balance of the Mortgage Loans in the related Loan Group as of
the last day of the related Remittance Period and (B) the Stated Principal
Balances of the Mortgage Loans in the related Loan Group as of the last day of
the related Remittance Period minus $600,970.23 with respect to Loan Group 1
and $774,029.78 with respect to Loan Group 2.
Class X Distributable Amount: On any Distribution Date, the amount
of interest that has accrued on the Class XF and Class XV Regular Interests
and any portion of the principal balance of either the Class XF or Class XV
Regular Interests which is distributable as a Subordination Reduction Amount
but that has not been distributed prior to such date less the amount thereof
distributed on the Class BB Certificates or deposited in the Interest Reserve
Acount for such Distribution Date.
Closing Date: April 27, 2000.
Code: The Internal Revenue Code of 1986, including any successor or
amendatory provisions.
Collateral Value: With respect to any Mortgage Loan, the Collateral
Value of the related Mortgaged Property shall be, other than with respect to
Mortgage Loans the proceeds of which were used for a Refinance Loan, the
lesser of (i) the appraised value determined in an appraisal obtained by the
originator at origination of such Mortgage Loan and (ii) the sales price for
such Mortgaged Property. In the case of Refinance Loans, the Collateral Value
of the related Mortgaged Property is the appraised value thereof determined in
an appraisal obtained at the time of refinancing.
Collection Account: As defined in Section 3.06(b).
Combined Loan-to-Value Ratio: For any Mortgage Loan at any time,
shall be the ratio expressed as a percentage of (i) the sum of (a) the
original principal balance of such Mortgage Loan and (b) the outstanding
principal balance at the date of origination of such Mortgage Loan of any
senior mortgage loan(s), or in the case of any open-ended senior mortgage
loan, the maximum available line of credit with respect to such mortgage loan
at origination, regardless of any lesser amount actually outstanding at the
date of origination of such Mortgage Loan, to (ii) the Collateral Value of
such Mortgage Loan.
Compensating Interest: For any Distribution Date, an amount equal to
0.25% multiplied by one-twelfth multiplied by the aggregate Stated Principal
Balance of the Mortgage Loans as of the first day of the prior month.
Cooperative Corporation: The entity that holds title (fee or an
acceptable leasehold estate) to the real property and improvements
constituting the Cooperative Property and which governs the Cooperative
Property, which Cooperative Corporation must qualify as a Cooperative Housing
Corporation under Section 216 of the Code.
Coop Shares: Shares issued by a Cooperative Corporation.
Cooperative Loan: Any Mortgage Loan secured by Coop Shares and a
Proprietary Lease.
Cooperative Property: The real property and improvements owned by
the Cooperative Corporation, including the allocation of individual dwelling
units to the holders of the Coop Shares of the Cooperative Corporation.
Cooperative Unit: A single family dwelling located in a Cooperative
Property.
Corporate Trust Office: The designated office of the Trustee in the
State of New York at which at any particular time its corporate trust business
with respect to this Agreement shall be administered, which office at the date
of the execution of this Agreement is located at 101 Barclay Street, 12E, New
York, New York 10286 (Attn: Mortgage-Backed Securities Group, IndyMac ABS,
Inc., Home Equity Mortgage Loan Asset-Backed Trust, Series SPMD 2000-A),
facsimile no. (212) 815-4135 and which is the address to which notices to and
correspondence with the Trustee should be directed.
Corresponding Class: The class of interests in any REMIC created
under this Agreement that correspond to the Class of interests in another such
REMIC or to a Class of Certificates in the manner set out below:
Lower Tier Class
Designation Upper Tier Interest Corresponding Certificate
Class LT-AF-1 Class AF-1 Class AF-1
Class LT-AF-2 Class AF-2 Class AF-2
Class LT-AF-3 Class AF-3 Class AF-3
Class LT-MF-1 Class MF-1 Class MF-1
Class LT-MF-2 Class MF-2 Class MF-2
Class LT-BF Class BF Class BF
Class LT-AV-1 Class AV-1 Class AV-1
Class LT-MV-1 Class MV-1 Class MV-1
Class LT-MV-2 Class MV-2 Class MV-2
Class LT-BV Class BV Class BV
Cut-off Date: For each Initial Mortgage Loan, April 1, 2000; for
each Subsequent Mortgage Loan, May 1, 2000.
Cut-off Date Pool Principal Balance: For any Cut-off Date, the
aggregate Stated Principal Balance of all Mortgage Loans as of such date.
Cut-off Date Principal Balance: As to any Mortgage Loan, the Stated
Principal Balance thereof as of the close of business on the related Cut-off
Date.
Debt Service Reduction: With respect to any Mortgage Loan, a
reduction by a court of competent jurisdiction in a proceeding under the
Bankruptcy Code in the Scheduled Payment for such Mortgage Loan which became
final and non-appealable, except such a reduction resulting from a Deficient
Valuation or any reduction that results in a permanent forgiveness of
principal.
Debt Service Reduction Mortgage Loan: Any Mortgage Loan that became
the subject of a Debt Service Reduction.
Defective Mortgage Loan: Any Mortgage Loan which is required to be
repurchased pursuant to Section 2.02 or 2.03.
Deficient Valuation: With respect to any Mortgage Loan, a valuation
by a court of competent jurisdiction of the Mortgaged Property in an amount
less than the then outstanding indebtedness under the Mortgage Loan, or any
reduction in the amount of principal to be paid in connection with any
Scheduled Payment that results in a permanent forgiveness of principal, which
valuation or reduction results from an order of such court which is final and
non-appealable in a proceeding under the Bankruptcy Code.
Definitive Certificates: Any Certificate evidenced by a Physical
Certificate and any Certificate issued in lieu of a Book-Entry Certificate
pursuant to Section 5.02(e).
Delay Certificates: As specified in the Preliminary Statement.
Deleted Mortgage Loan: As defined in Section 2.03(c).
Denomination: With respect to each Certificate, the amount set forth
on the face thereof as the "Initial Certificate Balance of this Certificate"
or the Percentage Interest appearing on the face thereof.
Depositor: IndyMac ABS, Inc., a Delaware corporation, or its
successor in interest.
Depository: The initial Depository shall be The Depository Trust
Company, the nominee of which is CEDE & Co., as the registered Holder of the
Book-Entry Certificates. The Depository shall at all times be a "clearing
corporation" as defined in Section 8-102(a)(5) of the Uniform Commercial Code
of the State of New York.
Depository Participant: A broker, dealer, bank or other financial
institution or other Person for whom from time to time a Depository effects
book-entry transfers and pledges of securities deposited with the Depository.
Determination Date: As to any Distribution Date, the 18th day of
each month or if such 18th day is not a Business Day the next succeeding
Business Day; provided, however, that if such next succeeding Business Day is
less than two Business Days prior to the related Distribution Date, then the
Determination Date shall be the next Business Day preceding the 18th day of
such month.
Distribution Account: The separate Eligible Account created and
maintained by the Trustee pursuant to Section 3.06(e) in the name of the
Trustee for the benefit of the Certificateholders and designated "The Bank of
New York in trust for registered holders of IndyMac Home Equity Mortgage Loan
Asset-Backed Certificates, Series SPMD 2000-A". Funds in the Distribution
Account shall be held in trust for the Certificateholders for the uses and
purposes set forth in this Agreement.
Distribution Account Deposit Date: As to any Distribution Date,
12:30 p.m. Pacific time on the Business Day immediately preceding such
Distribution Date.
Distribution Date: The 25th day of each calendar month after the
initial issuance of the Certificates, or if such 25th day is not a Business
Day, the next succeeding Business Day, commencing in May 2000.
Due Date: With respect to any Mortgage Loan, the day of the month on
which a Scheduled Payment is due which is the first day of the month.
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 debt obligations of such holding company, but only if
Moody's is not a Rating Agency) have the highest short-term ratings of each
Rating Agency at the time any amounts are held on deposit therein, or (ii) an
account or accounts in a depository institution or trust company in which such
accounts are insured by the FDIC or the SAIF (to the limits established by the
FDIC or the SAIF) and the uninsured deposits in which accounts are otherwise
secured such that, as evidenced by an Opinion of Counsel delivered to the
Trustee and to each Rating Agency, the Certificateholders have a claim with
respect to the funds in such account or a perfected first priority security
interest against any 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 or trust company in
which such account is maintained, or (iii) a trust account or accounts
maintained with the trust department of a federal or state chartered
depository institution or trust company, acting in its fiduciary capacity or
(iv) any other account acceptable to each Rating Agency. Eligible Accounts may
bear interest, and may include, if otherwise qualified under this definition,
accounts maintained with the Trustee.
ERISA: The Employee Retirement Income Security Act of 1974, as
amended.
ERISA-Qualifying Underwriting: A best efforts or firm commitment
underwriting or private placement that meets the requirements of Prohibited
Transaction Exemption 97-34, 62 Fed. Reg. 39021 (1997), as amended (or any
successor thereto), or any substantially similar administrative exemption
granted by the U.S. Department of Labor (an "Underwriter's Exemption").
ERISA-Restricted Certificate: As specified in the Preliminary
Statement.
Escrow Account: The Eligible Account or Accounts established and
maintained pursuant to Section 3.07(a).
Event of Default: As defined in Section 7.01.
Excess Proceeds: With respect to any Liquidated Mortgage Loan, the
amount, if any, by which the sum of any Liquidation Proceeds of such Mortgage
Loan received in the calendar month in which such Mortgage Loan became a
Liquidated Mortgage Loan, net of any amounts previously reimbursed to the
Master Servicer as Nonrecoverable Advance(s) with respect to such Mortgage
Loan pursuant to Section 3.09(a)(ii), exceeds (i) the unpaid principal balance
of such Liquidated Mortgage Loan as of the Due Date in the month in which such
Mortgage Loan became a Liquidated Mortgage Loan plus (ii) accrued interest at
the Mortgage Rate from the Due Date as to which interest was last paid or
advanced (and not reimbursed) to Certificateholders up to the Due Date
applicable to the Distribution Date immediately following the calendar month
during which such liquidation occurred.
Excess Reserve Fund Account: The separate Eligible Account created
and maintained by the Trustee pursuant to Section 3.06(d) in the name of the
Trustee for the benefit of the Adjustable Rate Certificateholders and
designated "The Bank of New York in trust for registered holders of IndyMac
Home Equity Mortgage Loan Asset-Backed Trust, Series SPMD 2000-A". Funds in
the Excess Reserve Fund Account shall be held in trust for the Adjustable Rate
Certificateholders for the uses and purposes set forth in this Agreement.
Excess Subordinated Amount: With respect to a Certificate Group and
any Distribution Date, the excess, if any, of (a) the related Subordinated
Amount on such Distribution Date over (b) the related Specified Subordinated
Amount for such Distribution Date.
Expense Fees: As to each Mortgage Loan, the sum of the related
Master Servicing Fee, Servicing Fee and Trustee Fee.
Expense Fee Rate: As to each Mortgage Loan, the sum of the related
Master Servicing Fee Rate, Servicing Fee Rate and Trustee Fee Rate.
Extra Principal Distribution Amount: As of any Distribution Date and
either Certificate Group, the lesser of (x) the related Total Monthly Excess
Spread for such Distribution Date and (y) the related Subordination Deficiency
for such Distribution Date.
FDIC: The Federal Deposit Insurance Corporation, or any successor
thereto.
FHLMC: The Federal Home Loan Mortgage Corporation, a corporate
instrumentality of the United States created and existing under Title III of
the Emergency Home Finance Act of 1970, as amended, or any successor thereto.
Final Scheduled Payment Date: The Final Scheduled Payment Date for
each Class of Certificates is as follows:
<TABLE>
<CAPTION>
Final Scheduled
Payment Date
---------------------------------
<S> <C>
Class AF-1 Certificates.......................................................... July 25, 2018
Class AF-2 Certificates.......................................................... May 25, 2026
Class AF-3 Certificates.......................................................... February 25, 2030
Class MF-1 Certificates.......................................................... June 25, 2031
Class MF-2 Certificates.......................................................... June 25, 2031
Class BF Certificates............................................................ June 25, 2031
Class AV-1 Certificates.......................................................... June 25, 2031
Class MV-1 Certificates.......................................................... June 25, 2031
Class MV-2 Certificates.......................................................... June 25, 2031
Class BV Certificates............................................................ June 25, 2031
</TABLE>
FIRREA: The Financial Institutions Reform, Recovery and Enforcement
Act of 1989.
Fitch: Fitch IBCA, Inc., or any successor thereto. If Fitch is
designated as a Rating Agency in the Preliminary Statement, for purposes of
Section 10.05(b) the address for notices to Fitch shall be Fitch IBCA, One
State street Plaza, New York, NY 10004, Attention: MBS Monitoring - IndyMac
SPMD 2000-A, or such other address as Fitch may hereafter furnish to the
Depositor and the Master Servicer.
FNMA: The Federal National Mortgage Association, a federally
chartered and privately owned corporation organized and existing under the
Federal National Mortgage Association Charter Act, or any successor thereto.
Group 1 Certificates: As specified in the Preliminary Statement.
Group 1 Capitalized Interest Account: The separate Eligible Account
created and maintained by the Trustee pursuant to Section 3.06 in the name of
the Trustee for the benefit of the Certificateholders and designated "The Bank
of New York, in trust for registered holders of IndyMac Home Equity Mortgage
Loan Asset-Backed Certificates, Series SPMD 2000-A". Funds in the Group 1
Capitalized Interest Account shall be held in trust for the Certificateholders
for the uses and purposes set forth in this Agreement and shall not be a part
of any REMIC created hereunder, provided, however that any investment income
earned from Permitted Investments made with funds in the Group 1 Capitalized
Interest Account will be for the account of the Seller.
Group 1 Pre-Funding Account: The separate Eligible Account created
and maintained by the Trustee pursuant to Section 3.06 in the name of the
Trustee for the benefit of the Certificateholders and designated "The Bank of
New York, in trust for registered holders of IndyMac Home Equity Mortgage Loan
Asset-Backed Certificates, Series SPMD 2000-A" allocated for the purchase of
Subsequent Mortgage Loans to be included in Loan Group 1. Funds in the Group 1
Pre-Funding Account shall be held in trust for the Certificateholders for the
uses and purposes set forth in this Agreement and shall not be a part of any
REMIC created hereunder.
Group 1 WAC Cap: With respect to the Mortgage Loans in Loan Group 1
as of any Distribution Date, the weighted average of the Mortgage Rates in
effect on the beginning of the related Remittance Period for such Mortgage
Loans minus Expense Fee Rate.
Group 2 Certificates: As specified in the Preliminary Statement.
Group 2 Capitalized Interest Account: The separate Eligible Account
created and maintained by the Trustee pursuant to Section 3.06 in the name of
the Trustee for the benefit of the Certificateholders and designated "The Bank
of New York, in trust for registered holders of IndyMac Home Equity Mortgage
Loan Asset-Backed Certificates, Series SPMD 2000-A". Funds in the Group 2
Capitalized Interest Account shall be held in trust for the Certificateholders
for the uses and purposes set forth in this Agreement and shall not be a part
of any REMIC created hereunder, provided, however that any investment income
earned from Permitted Investments made with funds in the Group 2 Capitalized
Interest Account will be for the account of the Seller.
Group 2 Pre-Funding Account: The separate Eligible Account created
and maintained by the Trustee pursuant to Section 3.05 in the name of the
Trustee for the benefit of the Certificateholders and designated "The Bank of
New York, in trust for registered holders of IndyMac Home Equity Mortgage Loan
Asset-Backed Certificates, Series SPMD 2000-A" allocated for the purchase of
Subsequent Mortgage Loans to be included in Loan Group 2. Funds in the Group 2
Pre-Funding Account shall be held in trust for the Certificateholders for the
uses and purposes set forth in this Agreement and shall not be a part of any
REMIC created hereunder.
Group 2 Maximum Cap: With respect to the Mortgage Loans in Loan
Group 2 as of any Distribution Date, the weighted average of the Maximum Rates
on the Mortgage Loans in Loan Group 2 less the Expense Fee Rate.
Group 2 Step-Up Trigger Event: With respect to Loan Group 2 and any
Distribution Date, exists if the quotient (expressed as a percentage) of (i)
the cumulative Realized Losses with respect to Loan Group 2 divided by (ii)
the Stated Principal Balance of the Mortgage Loans in Loan Group 2, as of the
last day of the Remittance Period, equals or exceeds the Specified Loss
Amount.
Group 2 WAC Cap: With respect to the Mortgage Loans in Loan Group 2
as of any Distribution Date, the product of (1) the weighted average of the
Mortgage Rates then in effect on the beginning of the related Remittance
Period on the Mortgage Loans in Loan Group 2 minus the Expense Fee Rate and
(ii) a fraction, the numerator of which is 30 and the denominator of which is
the actual number of days in the Interest Accrual Period for the Adjustable
Rate Loans related to such Distribution Date.
Index: As to each Mortgage Loan in Loan Group 2, the index from time
to time in effect for the adjustment of the Mortgage Rate set forth as such on
the related Mortgage Note.
Indirect Participant: A broker, dealer, bank or other financial
institution or other Person that clears through or maintains a custodial
relationship with a Depository Participant.
Initial Mortgage Loan: Such of the mortgage loans transferred and
assigned to the Trustee pursuant to the provisions hereof, as from time to
time are held as a part of the Trust Fund (including any REO Property), the
mortgage loans so held being identified on the Mortgage Loan Schedule as of
the Closing Date, notwithstanding foreclosure or other acquisition of title of
the related Mortgaged Property.
Insurance Policy: With respect to any Mortgage Loan included in the
Trust Fund, any insurance policy, including all riders and endorsements
thereto in effect, including any replacement policy or policies for any
Insurance Policies.
Insurance Proceeds: Proceeds paid by an insurer pursuant to any
Insurance Policy, in each case other than any amount included in such
Insurance Proceeds in respect of Insured Expenses.
Insured Expenses: Expenses covered by an Insurance Policy or any
other insurance policy with respect to the Mortgage Loans.
Interest Accrual Period: With respect to each Class of Delay
Certificates and each Class of Lower Tier Regular Interests and any
Distribution Date, the calendar month prior to the month of such Distribution
Date. For purposes of computing accrual of interest on each Class of Delay
Certificates and each Class of Lower Tier Regular Interests, each month is
assumed to have 30 days and each year is assumed to have 360 days. With
respect to each Class of Non-Delay Certificates and any Distribution Date, the
period commencing on the 25th day of the month preceding the month in which
such Distribution Date occurs and ending on the 24th day of the month in which
such Distribution Date occurs (or in the case of the first Distribution Date,
the period from and including the Closing Date to but excluding such first
Distribution Date). For purposes of computing interest accruals on each Class
of Non-Delay Certificates, each Interest Accrual Period has the actual number
of days in such month and each year is assumed to have 360 days.
Interest Reserve Account: The separate Eligible Account created and
maintained by the Trustee pursuant to Section 4.04 in the name of the Trustee
for the benefit of the Class BB Certificateholders and designated "The Bank of
New York in trust for registered holders of IndyMac Home Equity Mortgage Loan
Asset-Backed Certificates, Series SPMD 2000-A". Funds in the Interest Reserve
Account shall be held in trust for the Class BB Certificateholders for the
uses and purposes set forth in this Agreement.
Interest Reserve Release Amount: With respect to the Class BB
Certificate and any Distribution Date, the excess, if any, of the Outstanding
Interest Reserve Amount over the Interest Reserve Target Amount
Interest Reserve Target Amount: With respect to the Class BB
Certificate and (i) any Distribution Date prior to which the amount on deposit
in the Interest Reserve Account is first equal to $212,626.23, and (ii)
thereafter the lesser of (A) an amount equal to the product of (1) three and
(2) one month's interest at the Pass-Through Rate for such Class on the Class
BB Certificate Principal Balance as of such Distribution Date (before giving
effect to any distributions to the Class BB Certificate on such Distribution
Date), and (B) the Outstanding Interest Reserve Amount for such Distribution
Date.
Lender PMI Loans: Mortgage Loans with respect to which the lender
rather than the borrower acquired the primary mortgage guaranty insurance and
charged the related borrower an interest premium.
LIBOR: With respect to any Interest Accrual Period for the LIBOR
Certificates, the rate determined by the Trustee on the related LIBOR
Determination Date on the basis of the offered rate for one-month U.S. dollar
deposits as such rate appears on Telerate Page 3750 as of 11:00 a.m. (London
time) on such date; provided that if such rate does not appear on Telerate
Page 3750, the rate for such date will be determined on the basis of the rates
at which one-month U.S. dollar deposits are offered by the Reference Banks at
approximately 11:00 a.m. (London time) on such date to prime banks in the
London interbank market. In such event, the Trustee will request the principal
London office of each of the Reference Banks to provide a quotation of its
rate. If at least two such quotations are provided, the rate for that date
will be the arithmetic mean of the quotations (rounded upwards if necessary to
the nearest whole multiple of 1/16%). If fewer than two quotations are
provided as requested, the rate for that date will be the arithmetic mean of
the rates quoted by major banks in New York City, selected by the Master
Servicer, at approximately 11:00 a.m. (New York City time) on such date for
one-month U.S. dollar loan to leading European banks.
LIBOR Certificates: As specified in the Preliminary Statement.
LIBOR Determination Date: With respect to any Interest Accrual
Period (other than the initial Interest Accrual Period) for the LIBOR
Certificates, the second London Business Day preceding the commencement of
such Interest Accrual Period.
Liquidated Mortgage Loan: With respect to any Distribution Date, a
defaulted Mortgage Loan (including any REO Property) which was liquidated in
the calendar month preceding the month of such Distribution Date and as to
which the Master Servicer has certified (in accordance with this Agreement)
that it has received all amounts it expects to receive in connection with the
liquidation of such Mortgage Loan including the final disposition of an REO
Property.
Liquidation Proceeds: Amounts, including Insurance Proceeds,
received in connection with the partial or complete liquidation of defaulted
Mortgage Loans, whether through trustee's sale, foreclosure sale or otherwise
or amounts received in connection with any condemnation or partial release of
a Mortgaged Property and any other proceeds received in connection with an REO
Property, less the sum of related unreimbursed Master Servicing Fees,
Servicing Advances and Advances.
Loan Group: Any of Loan Group 1 or Loan Group 2, as applicable.
Loan Group 1: All Mortgage Loans which have Mortgage Rates that are
fixed.
Loan Group 2: All Mortgage Loans which have Mortgage Rates that are
adjustable.
Loan-to-Value Ratio: With respect to any Mortgage Loan and as of any
date of determination, is the fraction, expressed as a percentage, the
numerator of which is the original principal balance of the related Mortgage
Loan at such date of determination and the denominator of which is the
Collateral Value of the related Mortgaged Property.
London Business Day: Any day on which dealings in deposits of United
States dollars are transacted in the London interbank market.
Lost Mortgage Note: Any Mortgage Note the original of which was
permanently lost or destroyed and has not been replaced.
Lower Tier Adjustable Rate Regular Interest: Each of the Class
LT-AV-1, Class LT-MV-1, Class LT-MV-2, and Class BV Interests as described in
the Preliminary Statement.
Lower Tier Fixed Rate Regular Interest: Each of the Class LT-AF-1,
Class LT-AF-2, Class LT-AF-3, Class LT-MF-1, Class LT-MF-2, and Class LT-BF
Interests as described in the Preliminary Statement.
Lower Tier Regular Interests: Each of the Lower Tier Adjustable Rate
Regular Interests and the Lower Tier Fixed Rate Regular Interests.
Lower Tier REMIC: As described in the Preliminary Statement
Maintenance: With respect to any Cooperative Unit, the rent paid by
the Mortgagor to the Cooperative Corporation pursuant to the Proprietary
Lease.
Majority in Interest: As to any Class of Regular Certificates, the
Holders of Certificates of such Class evidencing, in the aggregate, at least
51% of the Percentage Interests evidenced by all Certificates of such Class.
Margin: As to each Mortgage Loan, the percentage amount set forth on
the related Mortgage Note added to the Index in calculating the Mortgage Rate
thereon.
Master Servicer: IndyMac, Inc., a Delaware corporation, and its
successors and assigns, in its capacity as master servicer hereunder.
Master Servicer Advance Date: As to any Distribution Date, 12:30
p.m. Pacific time on the Business Day immediately preceding such Distribution
Date.
Master Servicing Fee: As to each Mortgage Loan and any Distribution
Date, an amount equal to one month's interest at the related Master Servicing
Fee Rate on the Stated Principal Balance of such Mortgage Loan or, in the
event of any payment of interest which accompanies a Principal Prepayment in
Full made by the Mortgagor, interest at the Master Servicing Fee Rate on the
Stated Principal Balance of such Mortgage Loan for the period covered by such
payment of interest, subject to reduction as provided in Section 3.15.
Master Servicing Fee Rate: With respect to each Mortgage Loan,
0.041% per annum.
Maximum Rate: As to any Mortgage Loans in Loan Group 2, the maximum
rate set forth on the related Mortgage Note at which interest can accrue on
such Mortgage Loan.
Modified Mortgage Loan: Any Mortgage Loan which the Master Servicer
has modified pursuant to Section 3.12(c).
Monthly Statement: The statement delivered to the Certificateholders
pursuant to Section 4.06.
Mortgage: The mortgage, deed of trust or other instrument creating a
first lien on an estate in fee simple or leasehold interest in real property
securing a Mortgage Note.
Mortgage File: The mortgage documents listed in Section 2.01
pertaining to a particular Mortgage Loan and any additional documents
delivered to the Trustee to be added to the Mortgage File pursuant to this
Agreement.
Mortgage Loans: Such of the mortgage loans transferred and assigned
to the Trustee pursuant either (i) to the provisions hereof or (ii) to the
provisions of a Subsequent Transfer Agreement and to the provisions hereof, as
from time to time are held as a part of the Trust Fund (including any REO
Property), the mortgage loans so held being identified on the Mortgage Loan
Schedule, notwithstanding foreclosure or other acquisition of title of the
related Mortgaged Property.
Mortgage Loan Schedule: As of any date, the list of Mortgage Loans
included in the Trust Fund on such date, separately identifying the Initial
Mortgage Loans and the Subsequent Mortgage Loans (if any), attached hereto as
Schedule I. The Mortgage Loan Schedule shall be prepared by the Seller and
shall set forth the following information with respect to each Mortgage Loan.
(i) the loan number;
(ii) the Mortgagor's name and the street address of the Mortgaged
Property, including the zip code;
(iii) the maturity date;
(iv) the original principal balance;
(v) the Cut-off Date Principal Balance;
(vi) the first payment date of the Mortgage Loan;
(vii) the Scheduled Payment in effect as of the related Cut-off
Date;
(viii) the Loan-to-Value Ratio or Combined Loan-to-Value (as
applicable) at origination;
(ix) a code indicating whether the residential dwelling at the time
of origination was represented to be owner-occupied;
(x) a code indicating whether the residential dwelling is either (a)
a detached single family dwelling, (b) a dwelling in a PUD, (c) a
condominium unit, (d) a two- to four-unit residential property,
or (e) a Cooperative Unit;
(xi) the Mortgage Rate;
(xii) the purpose for the Mortgage Loan;
(xiii) the type of documentation program pursuant to which the
Mortgage Loan was originated;
(xiv) with respect to the Mortgage Loans in Loan Group 2:
(a) the Maximum Rate;
(b) the Periodic Rate Cap;
(c) the Adjustment Date;
(d) the Margin;
(xv) a code indicating whether the Mortgage Loan is a Performance
Loan;
(xvi) the Servicing Fee Rate;
(xvii) a code indicating whether the Mortgage Loan is a Lender PMI
Loan; and
(xviii) with respect to the Lender PMI Loans, the Lender PMI fee
premium.
Such schedule shall also set forth the total of the amounts described under
(v) above for all of the Mortgage Loans.
Mortgage Note: The original executed note or other evidence of
indebtedness evidencing the indebtedness of a Mortgagor under a Mortgage Loan.
Mortgage Rate: The annual rate of interest borne by a Mortgage Note
from time to time.
Mortgaged Property: The underlying property securing a Mortgage
Loan, which, with respect to a Cooperative Loan, is the related Coop Shares
and Proprietary Lease.
Mortgagor: The obligor(s) on a Mortgage Note.
Net Monthly Excess Cashflow: For any Distribution Date the amount
remaining for distribution pursuant to subsection 4.02(iii) (before giving
effect to distributions pursuant to such subsection).
Net Prepayment Interest Shortfall: For any Distribution Date and any
Loan Group, the amount by which the sum of the Prepayment Interest Shortfalls
with respect to such Loan Group exceeds the sum of the Compensating Interest
payments made on such Distribution Date with respect to such Loan Group.
Non-Delay Certificates: As specified in the Preliminary Statement.
Nonrecoverable Advance: Any portion of an Advance previously made or
proposed to be made by the Master Servicer, that, in the good faith judgment
of the Master Servicer, will not be ultimately recoverable by the Master
Servicer from the related Mortgagor, related Liquidation Proceeds or
otherwise.
Notice of Final Distribution: The notice to be provided pursuant to
Section 9.02 to the effect that final distribution on any of the Certificates
shall be made only upon presentation and surrender thereof.
Offered Certificates: As specified in the Preliminary Statement.
Officer's Certificate: A certificate (i) signed by the Chairman of
the Board, the Vice Chairman of the Board, the President, a Managing Director,
a Vice President (however denominated), an Assistant Vice President, the
Treasurer, the Secretary, or one of the Assistant Treasurers or Assistant
Secretaries of the Depositor or the Master Servicer, or (ii) if provided for
in this Agreement, signed by a Servicing Officer, as the case may be, and
delivered to the Depositor and the Trustee, as the case may be, as required by
this Agreement.
Opinion of Counsel: A written opinion of counsel, who may be counsel
for the Depositor or the Master Servicer, including in-house counsel,
reasonably acceptable to the Trustee; provided, however, that with respect to
the interpretation or application of the REMIC Provisions, such counsel must
(i) in fact be independent of the Depositor and the Master Servicer, (ii) not
have any direct financial interest in the Depositor or the Master Servicer or
in any affiliate of either, and (iii) not be connected with the Depositor or
the Master Servicer as an officer, employee, promoter, underwriter, trustee,
partner, director or person performing similar functions.
Optional Termination: The termination of the Trust Fund created
hereunder in connection with the purchase of the Mortgage Loans pursuant to
Section 9.01(a) hereof.
Optional Termination Date: The Distribution Date on which the assets
of the Trust Fund decline to 10% or less of the Cut-off Date Principal
Balances of the Mortgage Loans.
Original Mortgage Loan: The Mortgage Loan refinanced in connection
with the origination of a Refinance Loan.
OTS: The Office of Thrift Supervision.
Outstanding: With respect to the Certificates as of any date of
determination, all Certificates theretofore executed and authenticated under
this Agreement except:
(i) Certificates theretofore canceled by the Trustee or delivered to
the Trustee for cancellation; and
(ii) Certificates in exchange for which or in lieu of which other
Certificates have been executed and delivered by the Trustee pursuant
to this Agreement.
Outstanding Interest Reserve Amount: With respect to the Class BB
Certificate and any Distribution Date, the amount on deposit in the Interest
Reserve Account on such Distribution Date (before giving effect to any
withdrawals therefrom on such date).
Outstanding Mortgage Loan: As of any Due Date, a Mortgage Loan with
a Stated Principal Balance greater than zero which was not the subject of a
Principal Prepayment in Full prior to such Due Date and which did not become a
Liquidated Mortgage Loan prior to such Due Date.
Ownership Interest: As to any Residual Certificate, any ownership
interest in such Certificate including any interest in such Certificate as the
Holder thereof and any other interest therein, whether direct or indirect,
legal or beneficial.
Pass-Through Margin: With respect to each Class of Adjustable Rate
Certificates, the following percentages: Class AF-1 Certificates, 0.20%; Class
AV-1 Certificates, 0.26%; Class MV-1 Certificates, 0.60%; Class MV-2
Certificates, 1.05%; and Class BV Certificates, 2.10%. Following the Optional
Termination Date, the Pass-Through Margin for the Class AF-1 Certificates and
the Class AV-1 Certificates shall be doubled and the Pass-Through Margin for
Group 2 Subordinated Certificates shall increase by 1.5 times.
Pass-Through Rate: For each Class of Certificates, the per annum
rate set forth or calculated in the manner described in the Preliminary
Statement.
Percentage Interest: As to any Certificate, the percentage interest
evidenced thereby in distributions required to be made on the related Class,
such percentage interest being set forth on the face thereof or equal to the
percentage obtained by dividing the Denomination of such Certificate by the
aggregate of the Denominations of all Certificates of the same Class.
Performance Loan: Mortgage Loans that provide borrowers the
potential of margin reduction for good payment history. If, at the time of
evaluation, the related borrower has made scheduled payments in full since the
origination of the loan with a maximum of one late payment (which, however,
cannot be in the month of evaluation) the Mortgage Loan is eligible for a
reduction (ranging from 0.50% to 1.00%) in the margin used to calculate the
Mortgage Rate.
Periodic Rate Cap: As to any Mortgage Loan in Loan Group 2 and any
Adjustment Date, the maximum percentage increase or decrease to the related
Mortgage Rate on any such Adjustment Date, as specified in the related
Mortgage Note.
Permitted Investments: At any time, any one or more of the following
obligations and securities:
(i) obligations of the United States or any agency thereof, provided
that such obligations are backed by the full faith and credit of the
United States;
(ii) general obligations of or obligations guaranteed by any state
of the United States or the District of Columbia receiving the highest
long-term debt rating of each Rating Agency, or such lower rating as will
not result in the downgrading or withdrawal of the ratings then assigned
to the Certificates by the Rating Agencies, as evidenced by a signed
writing delivered by each Rating Agency;
(iii) commercial or finance company paper which is then receiving
the highest commercial or finance company paper rating of each Rating
Agency, or such lower rating as will not result in the downgrading or
withdrawal of the ratings then assigned to the Certificates by the Rating
Agencies, as evidenced by a signed writing delivered by each Rating
Agency;
(iv) certificates of deposit, demand or time deposits, or bankers'
acceptances issued by any depository institution or trust company
incorporated under the laws of the United States or of any state thereof
and subject to supervision and examination by federal and/or state
banking authorities, provided that the commercial paper and/or long-term
unsecured debt obligations of such depository institution or trust
company (or in the case of the principal depository institution in a
holding company system, the commercial paper or long-term unsecured debt
obligations of such holding company, but only if Moody's is not a Rating
Agency) are then rated one of the two highest long-term and the highest
short-term ratings of each Rating Agency for such securities, or such
lower ratings as will not result in the downgrading or withdrawal of the
ratings then assigned to the Certificates by the Rating Agencies, as
evidenced by a signed writing delivered by each Rating Agency;
(v) demand or time deposits or certificates of deposit issued by any
bank or trust company or savings institution to the extent that such
deposits are fully insured by the FDIC;
(vi) guaranteed reinvestment agreements issued by any bank,
insurance company or other corporation acceptable to the Rating Agencies
at the time of the issuance of such agreements, as evidenced by a signed
writing delivered by each Rating Agency;
(vii) repurchase obligations with respect to any security described
in clauses (i) and (ii) above, in either case entered into with a
depository institution or trust company (acting as principal) described
in clause (iv) above;
(viii) securities (other than stripped bonds, stripped coupons or
instruments sold at a purchase price in excess of 115% of the face amount
thereof) bearing interest or sold at a discount issued by any corporation
incorporated under the laws of the United States or any state thereof
which, at the time of such investment, have one of the two highest
ratings of each Rating Agency (except if the Rating Agency is Moody's
such rating shall be the highest commercial paper rating of Moody's for
any such securities), or such lower rating as will not result in the
downgrading or withdrawal of the ratings then assigned to the
Certificates by the Rating Agencies, as evidenced by a signed writing
delivered by each Rating Agency;
(ix) units of a taxable money-market portfolio having the highest
rating assigned by each Rating Agency (except (i) if Fitch or Duff &
Phelps is a Rating Agency and has not rated the portfolio, the highest
rating assigned by Moody's and (ii) if S&P is a Rating Agency, "AAAm-G"
by S&P) and restricted to obligations issued or guaranteed by the United
States of America or entities whose obligations are backed by the full
faith and credit of the United States of America and repurchase
agreements collateralized by such obligations; and
(x) such other investments bearing interest or sold at a discount
acceptable to each Rating Agency as will not result in the downgrading or
withdrawal of the ratings then assigned to the Certificates by the Rating
Agencies, as evidenced by a signed writing delivered by each Rating
Agency;
provided that no such instrument shall be a Permitted Investment if such
instrument evidences the right to receive interest only payments with respect
to the obligations underlying such instrument.
Permitted Transferee: Any person other than (i) the United States,
any State or political subdivision thereof, or any agency or instrumentality
of any of the foregoing, (ii) a foreign government, International Organization
or any agency or instrumentality of either of the foregoing, (iii) an
organization (except certain farmers' cooperatives described in section 521 of
the Code) which is exempt from tax imposed by Chapter 1 of the Code (including
the tax imposed by section 511 of the Code on unrelated business taxable
income) on any excess inclusions (as defined in section 860E(c)(1) of the
Code) with respect to any Residual Certificate, (iv) rural electric and
telephone cooperatives described in section 1381(a)(2)(C) of the Code, (v) a
Person that is not a U.S. Person, and (vi) any other Person so designated by
the Depositor based upon an Opinion of Counsel that the Transfer of an
Ownership Interest in a Residual Certificate to such Person may cause the
REMIC hereunder to fail to qualify as a REMIC at any time that the
Certificates are outstanding. The terms "United States," "State" and
"International Organization" shall have the meanings set forth in section 7701
of the Code or successor provisions. A corporation will not be treated as an
instrumentality of the United States or of any State or political subdivision
thereof for these purposes if all of its activities are subject to tax and,
with the exception of the Federal Home Loan Mortgage Corporation, a majority
of its board of directors is not selected by such government unit.
Person: Any individual, corporation, partnership, joint venture,
association, limited liability company, joint-stock company, trust,
unincorporated organization or government, or any agency or political
subdivision thereof.
Physical Certificates: As specified in the Preliminary Statement.
Pool Stated Principal Balance: As to any Distribution Date, the
aggregate of the Stated Principal Balances of the Mortgage Loans on the last
day of the related Remittance Period which were Outstanding Mortgage Loans on
such day.
Pre-Funding Amount: With respect to any date, the amount on deposit
in the respective Pre-Funding Accounts as of such date (net of any
reinvestment earnings thereon).
Pre-Funding Accounts: The separate Eligible Accounts created and
maintained by the Trustee pursuant to Section 3.06 in the name of the Trustee
for the benefit of the Certificateholders and designated "The Bank of New
York, in trust for registered holders of IndyMac Home Equity Mortgage Loan
Asset-Backed Certificates, Series SPMD 2000-A." Funds in the Pre-Funding
Accounts shall be held in trust for the Certificateholders for the uses and
purposes set forth in this Agreement and shall not be a part of any REMIC
created hereunder, provided, however that any investment income earned from
Permitted Investments made with funds in the Pre-Funding Accounts will be for
the account of the Depositor.
Pre-Funding Period: With respect to each Loan Group, the period
commencing on the Closing Date and ending on the earlier to occur of (i) the
date on which the amount on deposit in the Pre-Funding Accounts (exclusive of
any investment earnings) is less than $100,000 and (ii) May 31, 2000.
Prepayment Interest Shortfall: As to any Distribution Date, Mortgage
Loan and Principal Prepayment, the amount, if any, by which one month's
interest at the related Mortgage Rate (net of the related Master Servicing Fee
Rate) on such Principal Prepayment exceeds the amount of interest paid in
connection with such Principal Prepayment.
Prepayment Period: As to any Distribution Date, the applicable
Remittance Period.
Primary Insurance Policy: Each policy of primary mortgage guaranty
insurance or any replacement policy therefor with respect to any Mortgage
Loan.
Principal Distribution Amount: For each Certificate Group on any
Distribution Date, the sum of (i) the Basic Principal Distribution Amount for
such Distribution Date for such Certificate Group and (ii) the Extra Principal
Distribution Amount for such Distribution Date for such Certificate Group.
Principal Prepayment: Any payment of principal by a Mortgagor on a
Mortgage Loan (including without limitation the Purchase Price of any Modified
Mortgage Loan purchased pursuant to Section 3.12(c)) that is received in
advance of its scheduled Due Date and is not accompanied by an amount
representing scheduled interest due on any date or dates in any month or
months subsequent to the month of prepayment. Partial Principal Prepayments
shall be applied by the Master Servicer in accordance with the terms of the
related Mortgage Note.
Principal Prepayment in Full: Any Principal Prepayment made by a
Mortgagor of the entire principal balance of a Mortgage Loan.
Principal Remittance Amount: With respect to any Distribution Date
and each Loan Group, the amount equal to the sum of the following amounts
(without duplication) with respect to the immediately preceding Remittance
Period: (i) each payment of principal on a Mortgage Loan in the related Loan
Group received by the Master Servicer during such Remittance Period, including
all full and partial principal prepayments, (ii) the Liquidation Proceeds on
the Mortgage Loans in the related Loan Group allocable to principal actually
collected by the Master Servicer during the related Remittance Period, (iii)
the portion of the purchase price with respect to each Deleted Mortgage Loan
in the related Loan Group, the repurchase obligation for which arose during
the related Remittance Period and that was repurchased prior to the related
Distribution Account Deposit Date, (iv) the principal portion of any
Substitution Adjustment Amounts in connection with a substitution of a
Mortgage Loan in the related Loan Group as of such Distribution Date, (v) with
respect to the Distribution Date occurring in the month following the end of
the Pre-Funding Period, the related Unutilized Pre-Funding Amount and (vi) the
allocable portion of the proceeds received with respect to the termination of
the Trust Fund (to the extent such proceeds relate to principal).
Private Certificates: As specified in the Preliminary Statement.
Proprietary Lease: With respect to any Cooperative Unit, a lease or
occupancy agreement between a Cooperative Corporation and a holder of related
Coop Shares.
Prospectus Supplement: The Prospectus Supplement dated April 24,
2000 relating to the Offered Certificates.
PUD: Planned Unit Development.
Purchase Price: With respect to any Modified Mortgage Loan or any
Mortgage Loan required to be purchased by the Seller pursuant to Section 2.02
or 2.03 or purchased at the option of the Master Servicer pursuant to Section
3.12, an amount equal to the sum of (i) 100% of the unpaid principal balance
of the Mortgage Loan on the date of such purchase, and (ii) accrued interest
thereon at the applicable Mortgage Rate (or at the applicable Adjusted Net
Mortgage Rate if (x) the purchaser is the Master Servicer or (y) if the
purchaser is the Seller and the Seller is the Master Servicer) from the date
through which interest was last paid by the Mortgagor to the Due Date in the
month in which the Purchase Price is to be distributed to Certificateholders;
provided, however, that if such Mortgage Loan is a Modified Mortgage Loan, the
interest component of the Purchase Price shall be computed (i) on the basis of
the applicable Adjusted Net Mortgage Rate before giving effect to the related
modification and (ii) from the date to which interest was last paid to the
date on which such Modified Mortgage Loan is assigned to the Master Servicer
pursuant to Section 3.12(c).
Qualified Insurer: A mortgage guaranty insurance company duly
qualified as such under the laws of the state of its principal place of
business and each state having jurisdiction over such insurer in connection
with the insurance policy issued by such insurer, duly authorized and licensed
in such states to transact a mortgage guaranty insurance business in such
states and to write the insurance provided by the insurance policy issued by
it, approved as a FNMA- or FHLMC-approved mortgage insurer or having a claims
paying ability rating of at least "AA" or equivalent rating by a nationally
recognized statistical rating organization. Any replacement insurer with
respect to a Mortgage Loan must have at least as high a claims paying ability
rating as the insurer it replaces had on the Closing Date.
Rating Agency: Each of the Rating Agencies specified in the
Preliminary Statement. If either such organization or a successor is no longer
in existence, "Rating Agency" shall be such nationally recognized statistical
rating organization, or other comparable Person, as is designated by the
Depositor, notice of which designation shall be given to the Trustee.
References herein to a given rating or rating category of a Rating Agency
shall mean such rating category without giving effect to any modifiers. For
purposes of Section 10.05(b), the addresses for notices to each Rating Agency
shall be (i) S&P and (ii) Fitch, Attention: Residential Mortgage Surveillance
Monitoring, or such other address as either such Rating Agency may hereafter
furnish to the Depositor and the Master Servicer.
Recognition Agreement: With respect to any Cooperative Loan, an
agreement between the Cooperative Corporation and the originator of such
Mortgage Loan which establishes the rights of such originator in the
Cooperative Property.
Record Date: With respect to any Distribution Date, the close of
business on the last Business Day of the month preceding the month in which
such applicable Distribution Date occurs.
Reference Bank: As defined in Section 4.07.
Refinance Loan: Any Mortgage Loan the proceeds of which are used to
refinance an existing mortgage loan.
Regular Certificates: As specified in the Preliminary Statement.
Relevant Mortgage Loan: As defined in Section 3.12(c).
REMIC: A "real estate mortgage investment conduit" within the
meaning of section 860D of the Code.
REMIC Change of Law: Any proposed, temporary or final regulation,
revenue ruling, revenue procedure or other official announcement or
interpretation relating to REMICs and the REMIC Provisions issued after the
Closing Date.
REMIC Provisions: Provisions of the federal income tax law relating
to real estate mortgage investment conduits, which appear at sections 860A
through 860G of Subchapter M of Chapter 1 of the Code, and related provisions,
and regulations promulgated thereunder, as the foregoing may be in effect from
time to time as well as provisions of applicable state laws.
Remittance Period: With respect to any Distribution Date is the
period commencing on the second day of the month preceding the month in which
the Distribution Date occurs and ending on the first day of the month in which
such Distribution Date occurs.
REO Property: A Mortgaged Property acquired by the Trust Fund
through foreclosure or deed-in-lieu of foreclosure in connection with a
defaulted Mortgage Loan.
Request for Release: The Request for Release submitted by the Master
Servicer to the Trustee, substantially in the form of Exhibits M and N, as
appropriate.
Required Insurance Policy: With respect to any Mortgage Loan, any
insurance policy that is required to be maintained from time to time under
this Agreement.
Required Interest Reserve Account Deposit: With respect to any
Distribution Date, the amount, if any, by which the Interest Reserve Target
Amount exceeds the Outstanding Interest Reserve Amount.
Required Reserve Amount: On any Distribution Date that the Group 2
WAC Cap exceeds the Pass-Through Rate on the Class BV Certificate by less than
0.25% (25 basis points), the greater of $10,000 or the product of (i) 0.50%
and the Class Certificate Balance of the Adjustable Rate Certificates as of
such Distribution Date. On any Distribution Date that the Group 2 WAC Cap
exceeds the Pass-Through Rate on the Class BV Certificates by more than 0.25%,
$10,000.
Residual Certificates: As specified in the Preliminary Statement.
Responsible Officer: When used with respect to the Trustee, any Vice
President, any Assistant Vice President, any Assistant Secretary, any
Assistant Treasurer, any Trust Officer or any other officer of the Trustee
customarily performing functions similar to those performed by any of the
above designated officers who at such time shall be officers to whom, with
respect to a particular matter, such matter is referred because of such
officer's knowledge of and familiarity with the particular subject and who
shall have direct responsibility for the administration of this Agreement.
SAIF: The Savings Association Insurance Fund, or any successor
thereto.
S&P: Standard & Poor's, a division of The McGraw-Hill Companies. If
S&P is designated as a Rating Agency in the Preliminary Statement, for
purposes of Section 10.05(b) the address for notices to S&P shall be Standard
& Poor's Ratings Group, 26 Broadway, 10th Floor, New York, New York 10004,
Attention: Mortgage Surveillance Monitoring, or such other address as S&P may
hereafter furnish to the Depositor and the Master Servicer.
Scheduled Payment: The scheduled monthly payment on a Mortgage Loan
due on any Due Date allocable to principal and/or interest on such Mortgage
Loan which, unless otherwise specified herein, shall give effect to any
related Debt Service Reduction and any Deficient Valuation that affects the
amount of the monthly payment due on such Mortgage Loan.
Securities Act: The Securities Act of 1933, as amended.
Security Agreement: With respect to any Cooperative Loan, the
agreement between the owner of the related Coop Shares and the originator of
the related Mortgage Note, which defines the terms of the security interest in
such Coop Shares and the related Proprietary Lease.
Seller: IndyMac, Inc., a Delaware corporation, and its successors
and assigns, in its capacity as seller of the Mortgage Loans to the Depositor.
Senior Enhancement Percentage: With respect to either Certificate
Group and any Distribution Date, the percentage obtained by dividing (x) the
sum of (i) the aggregate Class Certificate Balance of the Subordinated
Certificates of such Certificate Group and (ii) the related Subordinated
Amount (in each case after taking into account the distributions of the
related Principal Distribution Amount for such Distribution Date) by (y) the
aggregate Stated Principal Balance of the Mortgage Loans in the related Loan
Group as of the last day of the related Remittance Period.
Senior Specified Enhancement Percentage: As of any date of
Determination, 22.00% with respect to Certificate Group 1 and 39.00% with
respect to Certificate Group 2.
Servicing Account: The separate Eligible Account or Accounts created
and maintained pursuant to Section 3.06(b) hereof.
Servicing Advances: All customary, reasonable and necessary "out of
pocket" costs and expenses incurred in the performance by the Master Servicer
of its servicing obligations, including, but not limited to, the cost of (i)
(a) the preservation, restoration and protection of a Mortgaged Property, (b)
expenses reimbursable to the Master Servicer pursuant to Section 3.12 and any
enforcement or judicial proceedings, including foreclosures, (c) the
management and liquidation of any REO Property and (d) compliance with the
obligations under Section 3.10; and (ii) reasonable compensation to the Master
Servicer or its affiliates for acting as broker in connection with the sale of
foreclosed Mortgaged Properties and for performing certain default management
and other similar services (including, but not limited to, appraisal services)
in connection with the servicing of defaulted Mortgage Loans; provided,
however, that for purposes of this clause (ii), only costs and expenses
incurred in connection with the performance of activities generally considered
to be outside the scope of customary servicing or master servicing duties
shall be treated as Servicing Advances.
Servicing Fee: As to each Mortgage Loan and any Distribution Date,
an amount equal to one month's interest at the applicable Servicing Fee Rate
on the Stated Principal Balance of such Mortgage Loan, or, in the event of any
payment of interest which accompanies a Principal Prepayment in Full made by
the Mortgagor, interest at the Servicing Fee Rate on the Stated Principal
Balance of such Mortgage Loan for the period covered by such payment of
interest, subject to reduction as provided in Section 3.15
Servicing Fee Rate: With respect to any Mortgage Loan, the per annum
rate set forth in the Mortgage Loan Schedule for such Mortgage Loan.
Servicing Officer: Any officer of the Master Servicer involved in,
or responsible for, the administration and servicing of the Mortgage Loans
whose name and facsimile signature appear on a list of servicing officers
furnished to the Trustee by the Master Servicer on the Closing Date pursuant
to this Agreement, as such list may from time to time be amended.
Servicing Standard: That degree of skill and care exercised by the
Master Servicer with respect to mortgage loans comparable to the Mortgage
Loans serviced by the Master Servicer for itself or others.
60+ Day Delinquent Loan: Each Mortgage Loan with respect to which
any portion of a Scheduled Payment is, as of the last day of the prior
Remittance 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 bankruptcy.
Specified Loss Amount: With respect to each Distribution Date from
May 2000 through April 2002, 0.65%; with respect to each Distribution Date
from May 2002 through April 2003, 1.90%, with respect to each Distribution
Date from May 2003 through April 2004, 3.30%, with respect to each
Distribution Date from May 2004 through April 2005, 4.25%, and with respect to
each Distribution Date thereafter, 6.00%.
Specified Subordinated Amount: With respect to each Loan Group prior
to the Stepdown Date for the related Certificate Group, an amount equal to
1.50% for Loan Group 1 and 2.25% (or 3.25%, if a Group 2 Step-Up Trigger Event
is in effect) for Loan Group 2, of the Cut-off Date Principal Balance of the
Mortgage Loans in the related Loan Group, and with respect to each Loan Group
on and after the Stepdown Date for the related Certificate Group, an amount
equal to 3.00% for Loan Group 1 and 4.50% (or 6.50%, if a Group 2 Step-Up
Trigger Event is in effect) for Loan Group 2, of the aggregate Stated
Principal Balance of the Mortgage Loans in such Loan Group as of the last day
of the related Remittance Period, subject to a minimum amount equal to 0.50%
for each Loan Group of the aggregate Stated Principal Balance of the Mortgage
Loans in that Loan Group as of the related Cut-off Date, provided, however,
that if, on any Distribution Date, a Trigger Event for a Certificate Group has
occurred, the Specified Subordinated Amount shall not be reduced to the
applicable percentage of the then current aggregate Stated Principal Balance
of the Mortgage Loans in the related Loan Group until the Distribution Date on
which a Trigger Event for such Certificate Group is no longer occurring.
Startup Day: The Closing Date.
Stated Principal Balance: As to any Mortgage Loan and Due Date, the
unpaid principal balance of such Mortgage Loan as of such Due Date as
specified in the amortization schedule at the time relating thereto (before
any adjustment to such amortization schedule by reason of any moratorium or
similar waiver or grace period) after giving effect to any previous partial
Principal Prepayments and Liquidation Proceeds allocable to principal (other
than with respect to any Liquidated Mortgage Loan) and to the payment of
principal due on such Due Date and irrespective of any delinquency in payment
by the related Mortgagor.
Stepdown Date: With respect to either Loan Group, the later to occur
of (i) the Distribution Date in May 2003 and (ii) the first Distribution Date
on which the Senior Enhancement Percentage (calculated for this purpose only
after taking into account distributions of principal on the Mortgage Loans in
the related Loan Group on the last day of the related Remittance Period but
prior to any applications of Principal Distribution Amount to the related
Certificates) is greater than or equal to the related Senior Specified
Enhancement Percentage.
Subordinated Amount: For each Certificate Group and as of any
Distribution Date and related Loan Group, the excess, if any, of (a) the
aggregate Stated Principal Balance of the Mortgage Loans in such Loan Group as
of the end of the related Remittance Period over (b) the aggregate of the
Class Certificate Balances of the Offered Certificates in the related
Certificate Group as of such Distribution Date (after giving effect to the
payment of principal on such Certificates on such Distribution Date) plus
amount in the related Pre-Funding Account, if any, excluding investment
earnings.
Subordinated Certificates: As specified in the Preliminary
Statement.
Subordination Deficiency: With respect to any Distribution Date and
either Loan Group, the excess, if any, of (a) the Specified Subordinated
Amount for the related Certificate Group applicable to such Distribution Date
over (b) the Subordinated Amount for such Certificate Group applicable to such
Distribution Date.
Subordination Reduction Amount: With respect to any Distribution
Date and either Loan Group, an amount equal to the lesser of (a) the related
Excess Subordinated Amount and (b) the Total Monthly Excess Spread for the
related Certificate Group.
Subsequent Mortgage Loan: Such of the mortgage loans transferred and
assigned to the Trustee pursuant to (i) the provisions of a Subsequent
Transfer Agreement and (ii) the provisions hereof, as from time to time are
held as a part of the Trust Fund (including any REO Property), the mortgage
loans so held being identified on the Mortgage Loan Schedule for the related
Subsequent Transfer Date, notwithstanding foreclosure or other acquisition of
title of the related Mortgaged Property. When used with respect to a single
Subsequent Transfer Date, "Subsequent Mortgage Loan" shall mean a Subsequent
Mortgage Loan conveyed to the Trust Fund on such Subsequent Transfer Date.
Subsequent Transfer Agreement: A Subsequent Transfer Agreement
substantially in the form of Exhibit Q hereto, executed and delivered by the
Seller, the Depositor and the Trustee as provided in Section 2.09(a).
Subsequent Transfer Date: For any Subsequent Transfer Agreement, the
"Subsequent Transfer Date" identified in such Subsequent Transfer Agreement;
provided, however, the Subsequent Transfer Date for any Subsequent Transfer
Agreement may not be a date earlier than the date on which the Subsequent
Transfer Agreement is executed and delivered by the parties thereto pursuant
to Section 2.09(a).
Subservicer: As defined in Section 3.02(a).
Substitute Mortgage Loan: A Mortgage Loan substituted by the Seller
for a Deleted Mortgage Loan which must, on the date of such substitution, as
confirmed in a Request for Release, substantially in the form of Exhibit M,
(i) have a Stated Principal Balance, after deduction of the principal portion
of the Scheduled Payment due in the month of substitution, not in excess of,
and not more than 10% less than, the Stated Principal Balance of the Deleted
Mortgage Loan; (ii) be accruing interest at a rate no lower than and not more
than 1% per annum higher than, that of the Deleted Mortgage Loan; (iii) have a
Loan-to-Value Ratio or Combined Loan-to-Value Ratio (as applicable) no higher
than that of the Deleted Mortgage Loan; (iv) have a remaining term to maturity
no greater than (and not more than one year less than that of) the Deleted
Mortgage Loan; (v) not be a Cooperative Loan unless the Deleted Mortgage Loan
was a Cooperative Loan and (vi) comply with each representation and warranty
set forth in Section 2.03.
Substitution Adjustment Amount: The meaning ascribed to such term
pursuant to Section 2.03.
Telerate Page 3750: The display page currently so designated on the
Bridge Telerate Service (or such other page as may replace that page on that
service for displaying comparable rates or prices).
Total Monthly Excess Spread: As to either Loan Group and any
Distribution Date, an amount equal to the excess if any, of (i) the interest
collected or advanced on the related Mortgage Loans during the related
Remittance Period plus the related Capitalized Interest Requirement for such
Distribution Date over (ii) the sum of the interest payable to the Classes of
Certificates in the related Certificate Group on such Distribution Date.
Transfer: Any direct or indirect transfer or sale of any Ownership
Interest in a Residual Certificate.
Trigger Event: With respect to the Certificates of a Certificate
Group after a Stepdown Date for the related Loan Group, exists if the quotient
(expressed as a percentage) of (x) the three month rolling average of 60+ Day
Delinquent Loans for the related Loan Group, as of the last day of the related
Remittance Period, over (y) the Stated Principal Balance of the Mortgage Loans
in that Loan Group equals or exceeds one-half of the related Senior
Enhancement Percentage.
Trust Fund: The corpus of the trust created hereunder consisting of
(i) the Mortgage Loans and all interest and principal received on or with
respect thereto after the related Cut-off Date, other than such amounts which
were due on the Mortgage Loans on or before the related Cut-off Date; (ii) the
Certificate Account, Excess Reserve Fund Account, the Distribution Account,
the Pre-Funding Accounts and the Capitalized Interest Accounts and all amounts
deposited therein pursuant to the applicable provisions of this Agreement
(including, without limitation, amounts received from the Seller on the
Closing Date which shall be deposited by the Trustee in the Certificate
Account pursuant to Section 2.01); (iii) property that secured a Mortgage Loan
and has been acquired by foreclosure, deed-in-lieu of foreclosure or
otherwise; and (iv) all proceeds of the conversion, voluntary or involuntary,
of any of the foregoing.
Trustee: The Bank of New York and its successors and, if a successor
trustee is appointed hereunder, such successor.
Trustee Fee: As to each Mortgage Loan and any Distribution Date, an
amount equal to one month's interest at the related Trustee Fee Rate on the
Stated Principal Balance of such Mortgage Loan or, in the event of any payment
of interest which accompanies a Principal Prepayment in Full made by the
Mortgagor, interest at the Trustee Fee Rate on the Stated Principal Balance of
such Mortgage Loan for the period covered by such payment of interest.
Trustee Fee Rate: With respect to each Mortgage Loan, the per annum
rate agreed upon in writing on or prior to the Closing Date by the Trustee and
the Depositor.
Unpaid Interest Amounts: As of any Distribution Date and any Class
of Certificates, the sum of (a) the excess of (i) the sum of the Accrued
Certificate Interest Distribution Amount for such Distribution Date and any
portion of such Accrued Certificate Interest Distribution Amount from prior
Distribution Dates remaining unpaid over (ii) the amount in respect of
interest on such Class of Certificates actually distributed on the preceding
Distribution Date and (b) 30 days' interest on such excess at the applicable
Pass-Through Rate (to the extent permitted by applicable law).
Unpaid Realized Loss Amount: With respect to any Class of
Subordinated Certificates and as to any Distribution Date, is the excess of
(i) Applied Realized Loss Amounts with respect to such Class over (ii) the sum
of all distributions in reduction of such Applied Realized Loss Amounts on all
previous Distribution Dates. Any amounts distributed to a Class of
Subordinated Certificates in respect of any Unpaid Realized Loss Amount will
not be applied to reduce the Class Certificate Balance of such Class.
United States Person or U.S. Person: Shall mean (i) a citizen or
resident of the United States; (ii) a corporation (or entity treated as a
corporation for tax purposes) created or organized in the United States or
under the laws of the United States or of any state thereof, including, for
this purpose, the District of Columbia; (iii) a partnership (or entity treated
as a partnership for tax purposes) organized in the United States or under the
laws of the United States or of any state thereof, including, for this
purpose, the District of Columbia (unless provided otherwise by future
Treasury regulations); (iv) an estate whose income is includible in gross
income for United States income tax purposes regardless of its source; or (v)
a trust, if a court within the United States is able to exercise primary
supervision over the administration of the trust and one or more U.S. Persons
have authority to control all substantial decisions of the trust.
Notwithstanding the last clause of the preceding sentence, to the extent
provided in Treasury regulations, certain trusts in existence on August 20,
1996, and treated as U.S. Persons prior to such date, may elect to continue to
be U.S. Persons.
Unutilized Pre-Funding Amount: The Pre-Funding Amount immediately
after the end of the Pre-Funding Period.
Upper Tier Regular Interest: As described in the Preliminary
Statement.
Upper Tier REMIC:. As described in the Preliminary Statement.
Voting Rights: The portion of the voting rights of all of the
Certificates which is allocated to any Certificate. As of any date of
determination, (a) 1% of all Voting Rights shall be allocated to each of the
Class BB Certificate and the Class X Certificate, if any (such Voting Rights
to be allocated among the holders of Certificates of each such Class in
accordance with their respective Percentage Interests) and (b) the remaining
Voting Rights shall be allocated among Holders of the remaining Classes of
Certificates in proportion to the Certificate Balances of their respective
Certificates on such date.
<PAGE>
ARTICLE II
CONVEYANCE OF MORTGAGE LOANS;
REPRESENTATIONS AND WARRANTIES
Section 2.01. Conveyance of Mortgage Loans.
(a) The Seller, concurrently with the execution and delivery hereof,
hereby sells, transfers, assigns, sets over and otherwise conveys to the
Depositor, without recourse, all the right, title and interest of the Seller
in and to each Initial Mortgage Loan, including all interest and principal
received or receivable by the Seller on or with respect to each Initial
Mortgage Loan after the related Cut-off Date and all interest and principal
payments on each Initial Mortgage Loan received prior to such related Cut-off
Date in respect of installments of interest and principal due thereafter, but
not including payments of principal and interest due and payable on each
Initial Mortgage Loan on or before such related Cut-off Date. On or prior to
the Closing Date, the Seller shall deliver to the Depositor or, at the
Depositor's direction, to the Trustee or other designee of the Depositor, the
Mortgage File for each Initial Mortgage Loan listed in the Mortgage Loan
Schedule as of the Closing Date. Such delivery of the Mortgage Files shall be
made against payment by the Depositor of the purchase price, previously agreed
to by the Seller and Depositor, for the Initial Mortgage Loans.
(b) The Depositor, concurrently with the execution and delivery
hereof, hereby sells, transfers, assigns, sets over and otherwise conveys to
the Trustee for the benefit of the Certificateholders, without recourse, all
the right, title and interest of the Depositor in and to the Trust Fund,
together with the Depositor's right to require the Seller to cure any breach
of a representation or warranty made herein by the Seller or to repurchase or
substitute for any affected Initial Mortgage Loan in accordance herewith.
(c) In connection with the transfer and assignment of each Initial
Mortgage Loan, the Depositor has delivered or caused to be delivered, and, in
connection with the transfer and assignment of each Subsequent Mortgage Loan,
will deliver or will cause to be delivered, to the Trustee for the benefit of
the Certificateholders the following documents or instruments with respect to
each Mortgage Loan so assigned:
(i) (A) the original Mortgage Note, endorsed by manual or
facsimile signature in blank in the following form: "Pay to the
order of without recourse", with all intervening endorsements
showing a complete chain of endorsement from the originator to the
Person endorsing the Mortgage Note (each such endorsement being
sufficient to transfer all right, title and interest of the party so
endorsing, as noteholder or assignee thereof, in and to that
Mortgage Note) and (B) with respect to any Lost Mortgage Note, a
lost note affidavit from the Seller stating that the original
Mortgage Note was lost or destroyed, together with a copy of such
Mortgage Note;
(ii) except as provided below, the original recorded Mortgage or
a copy of such Mortgage certified by the Seller (or, in the case of
a Mortgage for which the related Mortgaged Property is located in
the Commonwealth of Puerto Rico, a copy of such Mortgage certified
by the applicable notary) as being a true and complete copy of the
Mortgage;
(iii) a duly executed assignment of the Mortgage (which may be
included in a blanket assignment or assignments), together with,
except as provided below, all interim recorded assignments of such
mortgage (each such assignment, when duly and validly completed, to
be in recordable form and sufficient to effect the assignment of and
transfer to the assignee thereof, under the Mortgage to which the
assignment relates); provided that, if the related Mortgage has not
been returned from the applicable public recording office, such
assignment of the Mortgage may exclude the information to be
provided by the recording office; provided, further that such
assignment of Mortgage need not be delivered in the case of a
Mortgage for which the related Mortgage Property is located in the
Commonwealth of Puerto Rico.
(iv) the original or copies of each assumption, modification,
written assurance or substitution agreement, if any;
(v) except as provided below, the original or duplicate original
lender's title policy and all riders thereto; and
(vi) in the case of a Cooperative Loan, the originals of the
following documents or instruments:
(a) The Coop Shares, together with a stock power in blank;
(b) The executed Security Agreement;
(c) The executed Proprietary Lease;
(d) The executed Recognition Agreement;
(e) The executed UCC-1 financing statement with evidence of
recording thereon which have been filed in all places
required to perfect the Seller's interest in the Coop Shares
and the Proprietary Lease; and
(f) Executed UCC-3 financing statements or other appropriate UCC
financing statements required by state law, evidencing a
complete and unbroken line from the mortgagee to the Trustee
with evidence of recording thereon (or in a form suitable for
recordation).
In the event that in connection with any Mortgage Loan the Depositor
cannot deliver (a) the original recorded Mortgage, (b) all interim recorded
assignments or (c) the lender's title policy (together with all riders
thereto) satisfying the requirements of clause (ii), (iii) or (v) above,
respectively, concurrently with the execution and delivery hereof because such
document or documents have not been returned from the applicable public
recording office in the case of clause (ii) or (iii) above, or because the
title policy has not been delivered to either the Master Servicer or the
Depositor by the applicable title insurer in the case of clause (v) above, the
Depositor shall promptly deliver to the Trustee, in the case of clause (ii) or
(iii) above, such original Mortgage or such interim assignment, as the case
may be, with evidence of recording indicated thereon upon receipt thereof from
the public recording office, or a copy thereof, certified, if appropriate, by
the relevant recording office, but in no event shall any such delivery of the
original Mortgage Loan and each such interim assignment or a copy thereof,
certified, if appropriate, by the relevant recording office, be made later
than one year following the Closing Date (or, for a Subsequent Mortgage Loan,
the Subsequent Transfer Date), or, in the case of clause (v) above, later than
120 days following the Closing Date (or, for a Subsequent Mortgage Loan, the
Subsequent Transfer Date); provided, however, that in the event the Depositor
is unable to deliver by such date each Mortgage and each such interim
assignment by reason of the fact that any such documents have not been
returned by the appropriate recording office, or, in the case of each such
interim assignment, because the related Mortgage has not been returned by the
appropriate recording office, the Depositor shall deliver such documents to
the Trustee as promptly as possible upon receipt thereof and, in any event,
within 720 days following the Closing Date (or, for a Subsequent Mortgage
Loan, the Subsequent Transfer Date). The Depositor shall forward or cause to
be forwarded to the Trustee (a) from time to time additional original
documents evidencing an assumption or modification of a Mortgage Loan and (b)
any other documents required to be delivered by the Depositor or the Master
Servicer to the Trustee. In the event that the original Mortgage is not
delivered and in connection with the payment in full of the related Mortgage
Loan the public recording office requires the presentation of a "lost
instruments affidavit and indemnity" or any equivalent document, because only
a copy of the Mortgage can be delivered with the instrument of satisfaction or
reconveyance, the Master Servicer shall execute and deliver or cause to be
executed and delivered such a document to the public recording office. In the
case where a public recording office retains the original recorded Mortgage or
in the case where a Mortgage is lost after recordation in a public recording
office, the Seller shall deliver to the Trustee a copy of such Mortgage
certified by such public recording office to be a true and complete copy of
the original recorded Mortgage.
As promptly as practicable subsequent to such transfer and
assignment, and in any event, within thirty (30) days thereafter, the Trustee
shall (i) affix the Trustee's name to each assignment of Mortgage, as the
assignee thereof and (ii) cause to be delivered for recording in the
appropriate public office for real property records the assignments of the
Mortgages to the Trustee, except that, with respect to any assignment of a
Mortgage as to which the Trustee has not received the information required to
deliver such assignment, the Trustee's obligation to do so and to deliver the
same for such recording shall be as soon as practicable after receipt of such
information and in any event within thirty (30) days after the receipt
thereof, and the Trustee need not cause to be recorded any assignment which
relates to a Mortgage Loan (a) the Mortgaged Property and Mortgage File
relating to which are located in California or (b) in any other jurisdiction
(including Puerto Rico) under the laws of which, as evidenced by an Opinion of
Counsel delivered by the Seller (at the Seller's expense) to the Trustee, the
recordation of such assignment is not necessary to protect the Trustee's and
the Certificateholders' interest in the related Mortgage Loan.
In the case of Mortgage Loans that have been prepaid in full as of
the Closing Date, the Depositor, in lieu of delivering the above documents to
the Trustee, will deposit in the Certificate Account the portion of such
payment that is required to be deposited in the Certificate Account pursuant
to Section 3.06.
(d) The Seller agrees to treat the transfer of the Mortgage Loans to
the Depositor as a sale for all tax, accounting and regulatory purposes.
Section 2.02. Acceptance by the Trustee of the Mortgage Loans.
(a) The Trustee acknowledges receipt of the documents identified in
the Initial Certification in the form annexed hereto as Exhibit G, and receipt
of the amount of $19,329,796.93 for deposit in the Group 1 Pre-Funding
Account, the amount of $24,250,071.47 for deposit in the Group 2 Pre-Funding
Account, the amount of $78, 790.40 for deposit in the Group 1 Capitalized
Interest Account and the amount of $72,278.69 for deposit in the Group 2
Capitalized Interest Account, and declares that it holds and will hold such
documents and the other documents delivered to it constituting the Mortgage
Files for the Initial Mortgage Loans, that it holds and will hold all amounts
in the Pre-Funding Accounts and the Capitalized Interest Accounts, and that it
holds or will hold such other assets as are included in the Trust Fund, in
trust for the exclusive use and benefit of all present and future
Certificateholders. The Trustee acknowledges that it will maintain possession
of the related Mortgage Notes in the State of California, unless otherwise
permitted by the Rating Agencies.
The Trustee agrees to execute and deliver on the Closing Date to the
Depositor, the Master Servicer and the Seller an Initial Certification in the
form annexed hereto as Exhibit G. Based on its review and examination, and
only as to the documents identified in such Initial Certification, the Trustee
acknowledges that such documents appear regular on their face and relate to
such Initial Mortgage Loans. The Trustee shall be under no duty or obligation
to inspect, review or examine said documents, instruments, certificates or
other papers to determine that the same are genuine, enforceable or
appropriate for the represented purpose or that they have actually been
recorded in the real estate records or that they are other than what they
purport to be on their face.
Not later than 90 days after the Closing Date, the Trustee shall
deliver to the Depositor, the Master Servicer and the Seller a Final
Certification in the form annexed hereto as Exhibit H, with any applicable
exceptions noted thereon.
If, in the course of such review, the Trustee finds any document
constituting a part of a Mortgage File which does not meet the requirements of
Section 2.01, the Trustee shall list such as an exception in the Final
Certification; provided, however, that the Trustee shall not make any
determination as to whether (i) any endorsement is sufficient to transfer all
right, title and interest of the party so endorsing, as noteholder or assignee
thereof, in and to that Mortgage Note or (ii) any assignment is in recordable
form or is sufficient to effect the assignment of and transfer to the assignee
thereof under the mortgage to which the assignment relates. The Seller shall
promptly correct or cure such defect within 90 days from the date it was so
notified of such defect and, if the Seller does not correct or cure such
defect within such period, the Seller shall either (a) substitute for the
related Initial Mortgage Loan a Substitute Mortgage Loan, which substitution
shall be accomplished in the manner and subject to the conditions set forth in
Section 2.03, or (b) purchase such Initial Mortgage Loan from the Trustee
within 90 days from the date the Seller was notified of such defect in writing
at the Purchase Price of such Initial Mortgage Loan; provided, however, that
in no event shall such substitution or purchase occur more than 540 days from
the Closing Date, except that if the substitution or purchase of an Initial
Mortgage Loan pursuant to this provision is required by reason of a delay in
delivery of any documents by the appropriate recording office, or there is a
dispute between either the Master Servicer or the Seller and the Trustee over
the location or status of the recorded document, then such substitution or
purchase shall occur within 720 days from the Closing Date. The Trustee shall
deliver written notice to each Rating Agency within 270 days from the Closing
Date indicating each Initial Mortgage Loan (a) which has not been returned by
the appropriate recording office or (b) as to which there is a dispute as to
location or status of such Initial Mortgage Loan. Such notice shall be
delivered every 90 days thereafter until the related Initial Mortgage Loan is
returned to the Trustee. Any such substitution pursuant to (a) above or
purchase pursuant to (b) above shall not be effected prior to the delivery to
the Trustee of the Opinion of Counsel required by Section 2.05, if any, and
any substitution pursuant to (a) above shall not be effected prior to the
additional delivery to the Trustee of a Request for Release substantially in
the form of Exhibit N. No substitution is permitted to be made in any calendar
month after the Determination Date for such month. The Purchase Price for any
such Initial Mortgage Loan shall be deposited by the Seller in the Certificate
Account on or prior to the Distribution Account Deposit Date for the
Distribution Date in the month following the month of repurchase and, upon
receipt of such deposit and certification with respect thereto in the form of
Exhibit N hereto, the Trustee shall release the related Mortgage File to the
Seller and shall execute and deliver at the Seller's request such instruments
of transfer or assignment prepared by the Seller, in each case without
recourse, as shall be necessary to vest in the Seller, or a designee, the
Trustee's interest in any Initial Mortgage Loan released pursuant hereto.
The Trustee shall retain possession and custody of each Mortgage
File in accordance with and subject to the terms and conditions set forth
herein. The Master Servicer shall promptly deliver to the Trustee, upon the
execution or receipt thereof, the originals of such other documents or
instruments constituting the Mortgage File as come into the possession of the
Master Servicer from time to time.
It is understood and agreed that the obligation of the Seller to
substitute for or to purchase any Initial Mortgage Loan which does not meet
the requirements of Section 2.01 shall constitute the sole remedy respecting
such defect available to the Trustee, the Depositor and any Certificateholder
against the Seller.
(b) The Trustee agrees to execute and deliver to the Depositor, the
Master Servicer and the Seller on the Subsequent Transfer Date an Initial
Certification in the form annexed hereto as Exhibit G acknowledging receipt of
the documents identified in such Initial Certification and declaring that it
holds and will hold such documents and the other documents delivered to it
constituting the Mortgage Files for the related Subsequent Mortgage Loans, and
that it holds or will hold such other assets as are included in the Trust
Fund, in trust for the exclusive use and benefit of all present and future
Certificateholders. The Trustee acknowledges that it will maintain possession
of the related Mortgage Notes in the State of California, unless otherwise
permitted by the Rating Agencies.
Based on its review and examination, and only as to the documents
identified in such Initial Certification, the Trustee acknowledges that such
documents appear regular on their face and relate to such Subsequent Mortgage
Loan. The Trustee shall be under no duty or obligation to inspect, review or
examine said documents, instruments, certificates or other papers to determine
that the same are genuine, enforceable or appropriate for the represented
purpose or that they have actually been recorded in the real estate records or
that they are other than what they purport to be on their face.
Not later than 90 days after the Subsequent Transfer Date, the
Trustee shall deliver to the Depositor, the Master Servicer and the Seller a
Final Certification in the form annexed hereto as Exhibit H, with any
applicable exceptions noted thereon.
If, in the course of such review, the Trustee finds any document
constituting a part of a Subsequent Mortgage File which does not meet the
requirements of Section 2.01, the Trustee shall list such as an exception in
the Final Certification; provided, however, that the Trustee shall not make
any determination as to whether (i) any endorsement is sufficient to transfer
all right, title and interest of the party so endorsing, as Noteholder or
assignee thereof, in and to that Mortgage Note or (ii) any assignment is in
recordable form or is sufficient to effect the assignment of and transfer to
the assignee thereof under the mortgage to which the assignment relates. The
Seller shall promptly correct or cure such defect within 90 days from the date
it was so notified of such defect and, if the Seller does not correct or cure
such defect within such period, the Seller shall either (a) substitute for the
related Subsequent Mortgage Loan a Substitute Mortgage Loan, which
substitution shall be accomplished in the manner and subject to the conditions
set forth in Section 2.03, or (b) purchase such Subsequent Mortgage Loan from
the Trustee within 90 days from the date the Seller was notified of such
defect in writing at the Purchase Price of such Subsequent Mortgage Loan;
provided, however, that in no event shall such substitution or purchase occur
more than 540 days from the Subsequent Transfer Date, except that if the
substitution or purchase of a Subsequent Mortgage Loan pursuant to this
provision is required by reason of a delay in delivery of any documents by the
appropriate recording office, or there is a dispute between either the Master
Servicer or the Seller and the Trustee over the location or status of the
recorded document, then such substitution or purchase shall occur within 720
days from the Subsequent Transfer Date. The Trustee shall deliver written
notice to each Rating Agency within 270 days from the Subsequent Transfer Date
indicating each Subsequent Mortgage Loan (a) which has not been returned by
the appropriate recording office or (b) as to which there is a dispute as to
location or status of such Mortgage Loan. Such notice shall be delivered every
90 days thereafter until the related Subsequent Mortgage Loan is returned to
the Trustee. Any such substitution pursuant to (a) above or purchase pursuant
to (b) above shall not be effected prior to the delivery to the Trustee of the
Opinion of Counsel required by Section 2.05, if any, and any substitution
pursuant to (a) above shall not be effected prior to the additional delivery
to the Trustee of a Request for Release substantially in the form of Exhibit
N. No substitution is permitted to be made in any calendar month after the
Determination Date for such month. The Purchase Price for any such Subsequent
Mortgage Loan shall be deposited by the Seller in the Certificate Account on
or prior to the Distribution Account Deposit Date for the Distribution Date in
the month following the month of repurchase and, upon receipt of such deposit
and certification with respect thereto in the form of Exhibit N hereto, the
Trustee shall release the related Mortgage File to the Seller and shall
execute and deliver at the Seller's request such instruments of transfer or
assignment prepared by the Seller, in each case without recourse, as shall be
necessary to vest in the Seller, or a designee, the Trustee's interest in any
Subsequent Mortgage Loan released pursuant hereto.
The Trustee shall retain possession and custody of each related
Mortgage File in accordance with and subject to the terms and conditions set
forth herein. The Master Servicer shall promptly deliver to the Trustee, upon
the execution or receipt thereof, the originals of such other documents or
instruments constituting the Subsequent Mortgage File as come into the
possession of the Master Servicer from time to time.
It is understood and agreed that the obligation of the Seller to
substitute for or to purchase any Subsequent Mortgage Loan which does not meet
the requirements of Section 2.01 shall constitute the sole remedy respecting
such defect available to the Trustee, the Depositor and any Certificateholder
against the Seller.
Section 2.03. Representations, Warranties and Covenants of the
Seller and the Master Servicer.
(a) IndyMac, in its capacities as Seller and Master Servicer, hereby
makes the representations and warranties set forth in Schedule II hereto, and
by this reference incorporated herein, to the Depositor and the Trustee, as of
the Closing Date.
(b) The Seller, in its capacity as Seller, hereby makes the
representations and warranties set forth in Schedule III hereto, and by this
reference incorporated herein, to the Depositor and the Trustee, as of the
Closing Date, or if so specified therein, as of the related Cut-off Date.
(c) Upon discovery by any of the parties hereto of a breach of a
representation or warranty made pursuant to Section 2.03(b) that materially
and adversely affects the interests of the Certificateholders in any Mortgage
Loan, the party discovering such breach shall give prompt notice thereof to
the other parties. The Seller hereby covenants that within 90 days of the
earlier of its discovery or its receipt of written notice from any party of a
breach of any representation or warranty made pursuant to Section 2.03(b)
which materially and adversely affects the interests of the Certificateholders
in any Mortgage Loan, it shall cure such breach in all material respects, and
if such breach is not so cured, shall, (i) if such 90 day period expires prior
to the second anniversary of the Closing Date, remove such Mortgage Loan (a
"Deleted Mortgage Loan") from the Trust Fund and substitute in its place a
Substitute Mortgage Loan, in the manner and subject to the conditions set
forth in this Section 2.03; or (ii) repurchase the affected Mortgage Loan or
Mortgage Loans from the Trustee at the Purchase Price in the manner set forth
below; provided, however, that any such substitution pursuant to (i) above
shall not be effected prior to the delivery to the Trustee of the Opinion of
Counsel required by Section 2.05, if any, and a Request for Release
substantially in the form of Exhibit N, and the Mortgage File for any such
Substitute Mortgage Loan; and provided, further, that, anything to the
contrary herein notwithstanding, Seller shall have no obligation to cure any
such breach or to repurchase or substitute for such affected Mortgage Loan if
the substance of such breach constitutes fraud in the origination of such
affected Mortgage Loan and the Seller, at the time of such origination and on
the Closing Date, did not have actual knowledge of such fraud. The Seller
shall promptly reimburse the Master Servicer and the Trustee for any expenses
reasonably incurred by the Master Servicer or the Trustee in respect of
enforcing the remedies for such breach.
With respect to any Substitute Mortgage Loan or Loans, the Seller
shall deliver to the Trustee for the benefit of the Certificateholders the
Mortgage Note, the Mortgage, the related assignment of the Mortgage, and such
other documents and agreements as are required by Section 2.01, with the
Mortgage Note endorsed and the Mortgage assigned as required by Section 2.01.
No substitution is permitted to be made in any calendar month after the
Determination Date for such month. Scheduled Payments due with respect to
Substitute Mortgage Loans in the Remittance Period of substitution shall not
be part of the Trust Fund and will be retained by the Seller on the next
succeeding Distribution Date. For the Remittance Period of substitution,
distributions to Certificateholders will include the monthly payment due on
any Deleted Mortgage Loan for such Remittance Period and thereafter the Seller
shall be entitled to retain all amounts received in respect of such Deleted
Mortgage Loan.
The Master Servicer shall amend the Mortgage Loan Schedule for the
benefit of the Certificateholders to reflect the removal of such Deleted
Mortgage Loan and the substitution of the Substitute Mortgage Loan or Loans
and the Master Servicer shall deliver the amended Mortgage Loan Schedule to
the Trustee. Upon such substitution, the Substitute Mortgage Loan or Loans
shall be subject to the terms of this Agreement in all respects, and the
Seller shall be deemed to have made with respect to such Substitute Mortgage
Loan or Loans, as of the date of substitution, the representations and
warranties made pursuant to Section 2.03(b) with respect to such Mortgage
Loan. Upon any such substitution and the deposit to the Certificate Account of
the amount required to be deposited therein in connection with such
substitution as described in the following paragraph, the Trustee shall
release the Mortgage File held for the benefit of the Certificateholders
relating to such Deleted Mortgage Loan to the Seller and shall execute and
deliver at the Seller's direction such instruments of transfer or assignment
prepared by the Seller, in each case without recourse, as shall be necessary
to vest title in the Seller, or its designee, the Trustee's interest in any
Deleted Mortgage Loan substituted for pursuant to this Section 2.03.
For any month in which the Seller substitutes one or more Substitute
Mortgage Loans for one or more Deleted Mortgage Loans, the Master Servicer
will determine the amount (if any) by which the aggregate principal balance of
all such Substitute Mortgage Loans as of the date of substitution is less than
the aggregate Stated Principal Balance of all such Deleted Mortgage Loans
(after application of the scheduled principal portion of the monthly payments
due in the Remittance Period of substitution). The amount of such shortage
(the "Substitution Adjustment Amount") plus, if the Seller is not the Master
Servicer, an amount equal to the aggregate of any unreimbursed Advances and
Servicing Advances with respect to such Deleted Mortgage Loans shall be
deposited into the Certificate Account by the Seller on or before the
Distribution Account Deposit Date for the Distribution Date in the month
succeeding the calendar month during which the related Mortgage Loan became
required to be purchased or replaced hereunder.
In the event that the Seller shall have repurchased a Mortgage Loan,
the Purchase Price therefor shall be deposited in the Certificate Account
pursuant to Section 3.06 on or before the Distribution Account Deposit Date
for the Distribution Date in the month following the month during which the
Seller became obligated hereunder to repurchase or replace such Mortgage Loan
and upon such deposit of the Purchase Price, the delivery of the Opinion of
Counsel required by Section 2.05 and receipt of a Request for Release in the
form of Exhibit N hereto, the Trustee shall release the related Mortgage File
held for the benefit of the Certificateholders to such Person, and the Trustee
shall execute and deliver at such Person's direction such instruments of
transfer or assignment prepared by such Person, in each case without recourse,
as shall be necessary to transfer title from the Trustee. It is understood and
agreed that the obligation under this Agreement of any Person to cure,
repurchase or replace any Mortgage Loan as to which a breach has occurred and
is continuing shall constitute the sole remedy against such Persons respecting
such breach available to Certificateholders, the Depositor or the Trustee on
their behalf.
The representations and warranties made pursuant to this Section
2.03 shall survive delivery of the respective Mortgage Files to the Trustee
for the benefit of the Certificateholders.
Section 2.04. Representations and Warranties of the Depositor as to
the Mortgage Loans.
The Depositor hereby represents and warrants to the Trustee with
respect to each Mortgage Loan as of the date hereof or such other date set
forth herein that as of the Closing Date (or, for a Subsequent Mortgage Loan,
the Subsequent Transfer Date), and following the transfer of the Mortgage
Loans to it by the Seller, the Depositor had good title to the Mortgage Loans
and the Mortgage Notes were subject to no offsets, defenses or counterclaims.
The Depositor hereby assigns, transfers and conveys to the Trustee
all of its rights with respect to the Mortgage Loans including, without
limitation, the representations and warranties of the Seller made pursuant to
Section 2.03(b), together with all rights of the Depositor to require the
Seller to cure any breach thereof or to repurchase or substitute for any
affected Mortgage Loan in accordance with this Agreement.
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. Upon discovery by the Depositor or the Trustee of any breach of
any of the foregoing representations and warranties set forth in this Section,
which materially and adversely affects the interest of the Certificateholders,
the party discovering such breach shall give prompt written notice to the
others and to each Rating Agency.
Section 2.05. Delivery of Opinion of Counsel in Connection with
Substitutions and Repurchases.
(a) Notwithstanding any contrary provision of this Agreement, no
substitution pursuant to Section 2.02 or 2.03 shall be made more than 90 days
after the Closing Date unless the Seller delivers to the Trustee an Opinion of
Counsel, which Opinion of Counsel shall not be at the expense of either the
Trustee or the Trust Fund, addressed to the Trustee, to the effect that such
substitution will not (i) result in the imposition of the tax on "prohibited
transactions" on the Trust Fund or contributions after the Startup Date, as
defined in Sections 860F(a)(2) and 860G(d) of the Code, respectively or (ii)
cause the Trust Fund to fail to qualify as a REMIC at any time that any
Certificates are outstanding.
(b) Upon discovery by the Depositor, the Seller, the Master 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 promptly (and in any event within five (5)
Business Days of discovery) give written notice thereof to the other parties.
In connection therewith, the Trustee shall require the Seller, at the Seller's
option, to either (i) substitute, if the conditions in Section 2.03(c) with
respect to substitutions are satisfied, a Substitute Mortgage Loan for the
affected Mortgage Loan, or (ii) repurchase the affected Mortgage Loan within
90 days of such discovery in the same manner as it would a Mortgage Loan for a
breach of representation or warranty made pursuant to Section 2.03. 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 contained
in Section 2.03.
Section 2.06. Execution and Delivery of Certificates.
The Trustee acknowledges the transfer and assignment to it of the
Trust Fund and, concurrently with such transfer and assignment, has executed
and delivered to or upon the order of the Depositor, the Certificates in
authorized denominations evidencing directly or indirectly the entire
ownership of the Trust Fund. The Trustee agrees to hold the Trust Fund and
exercise the rights referred to above for the benefit of all present and
future Holders of the Certificates.
Section 2.07. REMIC Matters.
The Preliminary Statement sets forth the designations and "latest
possible maturity date" for federal income tax purposes of all interests
created hereby. The "Startup Day" for purposes of the REMIC Provisions shall
be the Closing Date.
Section 2.08. Covenants of the Master Servicer.
The Master Servicer hereby covenants to the Depositor and the
Trustee as follows:
(a) the Master Servicer shall comply in the performance of its
obligations under this Agreement with all reasonable rules and requirements of
the insurer under each Required Insurance Policy; and
(b) no written information, certificate of an officer, statement
furnished in writing or written report delivered to the Depositor, any
affiliate of the Depositor or the Trustee and prepared by the Master Servicer
pursuant to this Agreement will contain any untrue statement of a material
fact or omit to state a material fact necessary to make such information,
certificate, statement or report not misleading.
Section 2.09. Subsequent Transfers.
(a) Upon five Business Days prior written notice to the Trustee, the
Depositor, the Seller and the Trustee shall complete, execute and deliver a
Subsequent Transfer Agreement. Subject to the satisfaction of the conditions
set forth in Article II and paragraph (b) below and pursuant to the terms of
the related Subsequent Transfer Agreement, in consideration of the Trustee's
delivery on each Subsequent Transfer Date to or upon the order of the Seller
of all or a portion of the balance of funds in the Pre-Funding Accounts, the
Seller shall on each Subsequent Transfer Date sell, transfer, assign, set over
and otherwise convey to the Depositor, without recourse, all the right, title
and interest of the Seller in and to each Subsequent Mortgage Loan listed on
the Mortgage Loan Schedule delivered by the Seller on such Subsequent Transfer
Date, including all interest and principal received or receivable by the
Seller on or with respect to each Subsequent Mortgage Loan after the related
Cut-off Date and all interest and principal payments on each Subsequent
Mortgage Loan received prior to such related Cut-off Date in respect of
installments of interest and principal due thereafter, but not including
payments of principal and interest due and payable on each Subsequent Mortgage
Loan on or before such related Cut-off Date, and the Depositor shall
simultaneously sell, transfer, assign, set over and otherwise convey to the
Trustee for the benefit of the Certificateholders, without recourse, all the
right, title and interest of the Depositor in and to each Subsequent Mortgage
Loan listed on the Mortgage Loan Schedule delivered by the Seller on such
Subsequent Transfer Date, including all interest and principal received or
receivable by the Depositor on or with respect to each Subsequent Mortgage
Loan after the related Cut-off Date and all interest and principal payments on
each Subsequent Mortgage Loan received prior to such related Cut-off Date in
respect of installments of interest and principal due thereafter, but not
including payments of principal and interest due and payable on each
Subsequent Mortgage Loan on or before such related Cut-off Date.
If the assignment and transfer of the Subsequent Mortgage Loans and
the other property specified in this Section 2.09 from the Seller to the
Depositor pursuant to this Agreement is held or deemed not to be a sale or is
held or deemed to be a pledge of security for a loan, the Seller intends that
the rights and obligations of the parties shall be established pursuant to the
terms of this Agreement and that, in such event, (i) the Seller shall be
deemed to have granted and does hereby grant to the Depositor as of each
Subsequent Transfer Date a perfected, first priority security interest in the
entire right, title and interest of the Seller in and to the related
Subsequent Mortgage Loans and all other property conveyed to the Depositor
pursuant to this Section 2.09 and all proceeds thereof, and (ii) this
Agreement shall constitute a security agreement under applicable law.
If the assignment and transfer of the Subsequent Mortgage Loans and
the other property specified in this Section 2.09 from the Depositor to the
Trustee pursuant to this Agreement is held or deemed not to be a sale or is
held or deemed to be a pledge of security for a loan, the Depositor intends
that the rights and obligations of the parties shall be established pursuant
to the terms of this Agreement and that, in such event, (i) the Depositor
shall be deemed to have granted and does hereby grant to the Trustee as of
each Subsequent Transfer Date a perfected, first priority security interest in
the entire right, title and interest of the Depositor in and to the related
Subsequent Mortgage Loans and all other property conveyed to the Trust Fund
pursuant to this Section 2.09 and all proceeds thereof, and (ii) this
Agreement shall constitute a security agreement under applicable law.
The amount released from the Group 1 Pre-Funding Account by the
Trustee pursuant to this Section 2.09 shall be the aggregate Cut-off Date
Principal Balance of the Subsequent Mortgage Loans so transferred to Loan
Group 1. The amount released from the Group 2 Pre-Funding Account by the
Trustee pursuant to this Section 2.09 shall be the aggregate Cut-off Date
Principal Balance of the Subsequent Mortgage Loans so transferred to Loan
Group 2.
(b) The Trustee shall contribute from the Pre-Funding Accounts funds
in an amount equal to the aggregate Cut-off Date Principal Balance of the
Subsequent Mortgage Loans so transferred to the Trust Fund to purchase the
Subsequent Mortgage Loans on behalf of the Trust Fund, along with the other
property and rights related thereto described in Section 2.09(a) hereof only
upon the satisfaction of each of the following conditions:
(i) the Trustee will be provided Opinions of Counsel addressed to
the Rating Agencies with respect to the sale of the Subsequent
Mortgage Loans conveyed on such Subsequent Transfer Date (such
opinions being substantially similar to the opinions delivered on
the Closing Date to the Rating Agencies with respect to the sale of
the Initial Mortgage Loans on the Closing Date);
(ii) the execution and delivery of such Subsequent Transfer
Agreement or conveyance of the related Subsequent Mortgage Loans
does not result in a reduction or withdrawal of the any ratings
assigned to the Certificates by the Ratings Agencies;
(iii) the Depositor shall deliver to the Trustee an Officer's
Certificate confirming the satisfaction of each of the conditions
set forth in Article II and this Section 2.09(b) required to be
satisfied by such Subsequent Transfer Date;
(iv) each Subsequent Mortgage Loan conveyed on such Subsequent
Transfer Date satisfies the representations and warranties
applicable to it under this Agreement, provided, however, that with
respect to a breach of a representation and warranty with respect to
a Subsequent Mortgage Loan set forth in this clause (iv), the
obligation under Section 2.03(c) of this Agreement of the Seller to
cure, repurchase or replace such Subsequent Mortgage Loan shall
constitute the sole remedy against the Seller respecting such breach
available to Certificateholders, the Depositor or the Trustee.
(v) the Subsequent Mortgage Loans conveyed on such Subsequent
Transfer Date were selected in a manner reasonably believed not to
be adverse to the interests of the Certificateholders;
(vi) no Subsequent Mortgage Loan conveyed on such Subsequent
Transfer Date was 30 or more days delinquent;
(vii) each Subsequent Mortgage Loan conveyed on such Subsequent
Transfer Date that is an Adjustable Rate Mortgage Loan is secured by
a first lien on the related Mortgaged Property;
(viii) following the conveyance of the Subsequent Mortgage Loans on
such Subsequent Transfer Date to the related Loan Group, the
characteristics of such Loan Group listed below will not vary by
more than the permitted variance listed below for each
characteristic with respect to the Initial Mortgage Loans as set
forth on the Mortgage Loan Schedule delivered on the Closing Date;
provided that for the purpose of making such calculations, the
characteristics for each Mortgage Loan made will be taken as of the
related Cut-off Date for such Mortgage Loan:
<TABLE>
<CAPTION>
<S> <C> <C>
Loan Group 1: Variation
Loan Weighted Average Coupon:.............................................. - 0.01%
Weighted Average Maturity.................................................. +/- 1 month
Weighted Average Combined Loan-to-Value Ratio:............................. + 0.61%
Balloon Loans:............................................................. + 0.01%
Maximum Principal Balance.................................................. + $4,054.40
State Concentration:....................................................... + 1.01%
Zip Code Concentration:.................................................... + 2.00%
Non-Owner Occupied:........................................................ + 0.71%
Second Liens:.............................................................. + 0.11%
Manufactured Housing:...................................................... + 2.27%
Loan Group 2: Variation
Loan Weighted Average Coupon:.............................................. - 0.01%
Weighted Average Maturity.................................................. +/- 1 month
Weighted Average Combined Loan-to-Value Ratio:............................. + 0.34%
Performance Loans:......................................................... + 0.00%
Maximum Principal Balance.................................................. + $0.00
State Concentration:....................................................... + 1.00%
Zip Code Concentration:.................................................... + 2.00%
Non-Owner Occupied:........................................................ + 0.24%
First Liens:............................................................... + 0.00%
Manufactured Housing:...................................................... + 0.02%
</TABLE>
(ix) neither the Seller nor the Depositor is insolvent and neither
the Seller nor the Depositor will be rendered insolvent by the
conveyance of Subsequent Mortgage Loans on such Subsequent Transfer
Date;
(x) delivery of a letter or letters addressed to the Trustee from an
independent accountant retained by the Depositor confirming that the
characteristics of each Loan Group, following the acquisition of the
related Subsequent Mortgage Loans, conform to the characteristics
identified in this Section 2.09(b);
(xi) delivery to the Trustee of an Opinion of Counsel, which Opinion
of Counsel shall not be at the expense of either the Trustee or the
Trust Fund, addressed to the Trustee, to the effect that such
purchase of Subsequent Mortgage Loans will not (i) result in the
imposition of the tax on "prohibited transactions" on the Trust Fund
or contributions after the Startup Date, as defined in Sections
860F(a)(2) and 860G(d) of the Code, respectively or (ii) cause the
Trust Fund to fail to qualify as a REMIC at any time that any
Certificates are outstanding; and
(xii) delivery to the Trustee of the Mortgage File for each
Subsequent Mortgage Loan to be transferred pursuant to the
related Subsequent Transfer Agreement.
The Trustee shall not be required to investigate or otherwise verify
compliance with these conditions, except for its own receipt of documents
specified above, and shall be entitled to rely on the required Officer's
Certificate.
(c) In connection with each Subsequent Transfer Date and on the
related Distribution Date, the Seller shall determine (i) the amount and
correct dispositions of the funds distributed from the Capitalized Interest
Accounts and the Pre-Funding Accounts and (ii) any other necessary matters in
connection with the administration of the Capitalized Interest Accounts and
the Pre-Funding Accounts. In the event that any amounts are released by the
Trustee from a Pre-Funding Account or from a Capitalized Interest Account as a
result of the Seller's calculation error, the Trustee shall not be liable
therefor, and the Seller shall immediately repay such amounts to the Trustee.
Section 2.10. Mandatory Prepayment.
Any Unutilized Pre-Funding Amount shall be distributed to Holders of
the related Group of Certificates in accordance with Section 4.02 hereof on
the Distribution Date immediately following the Due Period in which the end of
the Pre-Funding Period occurs.
<PAGE>
ARTICLE III
ADMINISTRATION AND SERVICING
OF MORTGAGE LOANS
Section 3.01. Master Servicer to Service Mortgage Loans.
For and on behalf of the Certificateholders, the Master Servicer
shall service and administer the Mortgage Loans in accordance with the terms
of this Agreement and the Servicing Standard. In connection with such
servicing and administration, the Master Servicer shall have full power and
authority, acting alone and/or through Subservicers as provided in Section
3.02, to do or cause to be done any and all things that it may deem necessary
or desirable in connection with such servicing and administration, including
but not limited to, the power and authority, subject to the terms hereof, (i)
to execute and deliver, on behalf of the Certificateholders and the Trustee,
customary consents or waivers and other instruments and documents, (ii) to
consent to transfers of any Mortgaged Property and assumptions of the Mortgage
Notes and related Mortgages (but only in the manner provided in this
Agreement), (iii) to collect any Insurance Proceeds and other Liquidation
Proceeds, and (iv) to effectuate foreclosure or other conversion of the
ownership of the Mortgaged Property securing any Mortgage Loan. The Master
Servicer shall not make or permit any modification, waiver or amendment of any
term of any Mortgage Loan which would cause the Trust Fund to fail to qualify
as a REMIC or result in the imposition of any tax under Section 860F(a) or
Section 860G(d) of the Code. Without limiting the generality of the foregoing,
the Master Servicer, in its own name or in the name of any Servicer or the
Depositor and the Trustee, is hereby authorized and empowered by the Depositor
and the Trustee, when the Master Servicer or the Servicer, as the case may be,
believes it appropriate in its reasonable judgment, to execute and deliver, on
behalf of the Trustee, the Depositor, the Certificateholders or any of them,
any and all instruments of satisfaction or cancellation, or of partial or full
release or discharge, and all other comparable instruments, with respect to
the Mortgage Loans, and with respect to the Mortgaged Properties held for the
benefit of the Certificateholders. The Master Servicer shall prepare and
deliver to the Depositor and/or the Trustee such documents requiring execution
and delivery by either or both of them as are necessary or appropriate to
enable the Master Servicer to service and administer the Mortgage Loans to the
extent that the Master Servicer is not permitted to execute and deliver such
documents pursuant to the preceding sentence. Upon receipt of such documents,
the Depositor and/or the Trustee shall execute such documents and deliver them
to the Master Servicer.
In accordance with and to the extent of the Servicing Standard, the
Master Servicer shall advance or cause to be advanced funds as necessary for
the purpose of effecting the payment of taxes and assessments on the Mortgaged
Properties, which advances shall be reimbursable in the first instance from
related collections from the Mortgagors pursuant to Section 3.07, and further
as provided in Section 3.09. The costs incurred by the Master Servicer, if
any, in effecting the timely payments of taxes and assessments on the
Mortgaged Properties and related insurance premiums shall not, for the purpose
of calculating monthly distributions to the Certificateholders, be added to
the Stated Principal Balances of the related Mortgage Loans, notwithstanding
that the terms of such Mortgage Loans so permit.
Section 3.02. Subservicing; Enforcement of the Obligations of
Subservicers.
(a) The Master Servicer may arrange for the subservicing of any
Mortgage Loan by a subservicer pursuant to a subservicing agreement (a
"Subservicer"); provided, however, that such subservicing arrangement and the
terms of the related subservicing agreement must provide for the servicing of
such Mortgage Loans in a manner consistent with the servicing arrangements
contemplated hereunder. Unless the context otherwise requires, references in
this Agreement to actions taken or to be taken by the Master Servicer in
servicing the Mortgage Loans include actions taken or to be taken by a
Subservicer on behalf of the Master Servicer. Notwithstanding the provisions
of any subservicing agreement, any of the provisions of this Agreement
relating to agreements or arrangements between the Master Servicer and a
Subservicer or references to actions taken through a Subservicer or otherwise,
the Master Servicer shall remain obligated and liable to the Trustee and
Certificateholders for the servicing and administration of the Mortgage Loans
in accordance with the provisions of this Agreement without diminution of such
obligation or liability by virtue of such subservicing agreements or
arrangements or by virtue of indemnification from the Subservicer and to the
same extent and under the same terms and conditions as if the Master Servicer
alone were servicing and administering the Mortgage Loans. All actions of each
Subservicer performed pursuant to the related subservicing agreement shall be
performed as agent of the Master Servicer with the same force and effect as if
performed directly by the Master Servicer.
(b) For purposes of this Agreement, the Master Servicer shall be
deemed to have received any collections, recoveries or payments with respect
to the Mortgage Loans that are received by the Subservicer regardless of
whether such payments are remitted by such Subservicer to the Master Servicer.
Section 3.03. [Reserved].
Section 3.04. No Contractual Relationship Between Subservicers and
the Trustee.
Any subservicing arrangement that may be entered into and any other
transactions or services relating to the Mortgage Loans involving a
Subservicer in its capacity as such shall be deemed to be solely between the
Subservicer and the Master Servicer alone, and the Trustee and
Certificateholders shall not be deemed parties thereto and shall have no
claims, rights, obligations, duties or liabilities with respect to the
Subservicer in its capacity as such except as set forth in Section 3.05.
Section 3.05. Trustee to Act as Master Servicer.
In the event that the Master Servicer shall for any reason no longer
be the Master Servicer hereunder (including by reason of an Event of Default),
the Trustee or its successor shall thereupon assume all of the rights and
obligations of the Master Servicer hereunder arising thereafter (except that
the Trustee shall not be (i) liable for losses of the Master Servicer pursuant
to Section 3.10 or any acts or omissions of the predecessor Master Servicer
hereunder), (ii) obligated to make Advances if it is prohibited from doing so
by applicable law, (iii) obligated to effectuate repurchases or substitutions
of Mortgage Loans hereunder, including but not limited to repurchases or
substitutions pursuant to Section 2.02 or 2.03, (iv) responsible for expenses
of the Master Servicer pursuant to Section 2.03 or (v) deemed to have made any
representations and warranties of the Master Servicer hereunder. Any such
assumption shall be subject to Section 7.02.
Every subservicing agreement entered into by the Master Servicer
shall contain a provision giving the successor Master Servicer the option to
terminate such agreement in the event a successor Master Servicer is
appointed.
If the Master Servicer shall for any reason no longer be the Master
Servicer (including by reason of any Event of Default), the Trustee (or any
other successor Master Servicer) may, at its option, succeed to any rights and
obligations of the Master Servicer under any subservicing agreement in
accordance with the terms therof; provided that the Trustee (or any other
successor Master Servicer) shall not incur any liability or have any
obligations in its capacity as successor Master Servicer under a subservicing
agreement arising prior to the date of such succession unless it expressly
elects to succeed to the rights and obligations of the Master Servicer
thereunder; and the Master Servicer shall not thereby be relieved of any
liability or obligations under the subservicing agreement arising prior to the
date of such succession.
The Master Servicer shall, upon request of the Trustee, but at the
expense of the Master Servicer, deliver to the assuming party all documents
and records relating to each subservicing agreement (if any) and the Mortgage
Loans then being serviced thereunder and an accounting of amounts collected
held by it and otherwise use its best efforts to effect the orderly and
efficient transfer of the subservicing agreement to the assuming party.
Section 3.06. Collection of Mortgage Loan Payments; Servicing
Accounts; Collection Account; Certificate Account;
Distribution Account; Pre-Funding Accounts;
Capitalized Interest Accounts.
(a) In accordance with and to the extent of the Servicing Standard,
the Master Servicer shall make reasonable efforts in accordance with the
customary and usual standards of practice of prudent mortgage servicers to
collect all payments called for under the terms and provisions of the Mortgage
Loans to the extent such procedures shall be consistent with this Agreement
and the terms and provisions of any related Required Insurance Policy.
Consistent with the foregoing, the Master Servicer may in its discretion (i)
waive any late payment charge or any prepayment charge or penalty interest in
connection with the prepayment of a Mortgage Loan and (ii) extend the due
dates for payments due on a Mortgage Note for a period not greater than 125
days; provided, however, that the Master Servicer cannot extend the maturity
of any such Mortgage Loan past the date on which the final payment is due on
the latest maturing Mortgage Loan in the applicable Loan Group as of the
related Cut-off Date. In the event of any such arrangement, the Master
Servicer shall make Advances on the related Mortgage Loan in accordance with
the provisions of Section 4.01 during the scheduled period in accordance with
the amortization schedule of such Mortgage Loan without modification thereof
by reason of such arrangements. The Master Servicer shall not be required to
institute or join in litigation with respect to collection of any payment
(whether under a Mortgage, Mortgage Note or otherwise or against any public or
governmental authority with respect to a taking or condemnation) if it
reasonably believes that enforcing the provision of the Mortgage or other
instrument pursuant to which such payment is required is prohibited by
applicable law.
(b) The Master Servicer shall establish and maintain (or, if a
Mortgage Loan is subserviced by another Person, cause the related Subservicer
to establish and maintain) one or more Servicing Accounts into which the
Master Servicer shall deposit or cause to be deposited on a daily basis within
one Business Day of receipt, the following payments and collections received
by it or remitted by any Subservicer in respect of Mortgage Loans subsequent
to the related Cut-off Date (other than in respect of principal and interest
due on the Mortgage Loans on or before the related Cut-off Date):
(i) all payments on account of principal on the Mortgage Loans,
including Principal Prepayments;
(ii) all payments on account of interest on the Mortgage Loans,
net of the related Servicing Fee and, in cases where the Master
Servicer maintains the Servicing Account, the related Master
Servicer Fee; and
(iii) all Insurance Proceeds and Liquidation Proceeds, other
than proceeds to be applied to the restoration or repair of the
Mortgaged Property or released to the Mortgagor in accordance with
the Master Servicer's normal servicing procedures.
On or before the Withdrawal Date in each calendar month, the Master
Servicer shall (a) withdraw (or cause to be withdrawn and remitted to the
Master Servicer) from the Servicing Account all amounts on deposit therein
pursuant to clauses (i) and (ii) above (other than amounts attributable to a
Principal Prepayment in Full) and (b) deposit such amounts in the Collection
Account. On or before the Business Day in each calendar month following the
deposit in the Servicing Account of amounts on deposit therein pursuant to
clause (iii) above or pursuant to any Principal Prepayment in Full, the Master
Servicer shall (a) withdraw (or cause to be withdrawn and remitted to the
Master Servicer) such amounts from the Servicing Account and (b) deposit such
amounts in the Collection Account.
(c) The Master Servicer shall establish and maintain a Collection
Account into which the Master Servicer shall deposit, as and when required by
paragraph (b) of this Section 3.06, all amounts required to be deposited in
the Collection Account pursuant to that paragraph.
(d) The Master Servicer shall establish and maintain a Certificate
Account into which the Master Servicer shall deposit or cause to be deposited
on a daily basis (i) within one Business Day of deposit in the Collection
Account (in the case of items (i) through (iii) below) and (2) within one
Business Day of receipt (in the case of all other items), except as otherwise
specified herein, the following payments and collections received by it or
remitted by any Subservicer in respect of Mortgage Loans subsequent to the
related Cut-off Date (other than in respect of principal and interest due on
the Mortgage Loans on or before the related Cut-off Date) and the following
amounts required to be deposited hereunder:
(i) all payments on account of principal on the Mortgage Loans,
including Principal Prepayments;
(ii) all payments on account of interest on the Mortgage Loans, net
of the related Servicing Fee and the related Master Servicing Fee;
(iii) all Insurance Proceeds and Liquidation Proceeds, other than
proceeds to be applied to the restoration or repair of the Mortgaged Property
or released to the Mortgagor in accordance with the Master Servicer's normal
servicing procedures;
(iv) any amount required to be deposited by the Master Servicer
pursuant to Section 3.06(f) in connection with any losses on Permitted
Investments;
(v) any amounts required to be deposited by the Master Servicer
pursuant to Sections 3.12 and 3.14;
(vi) all Purchase Prices from the Master Servicer or Seller and all
Substitution Adjustment Amounts;
(vii) all Advances made by the Master Servicer pursuant to Section
4.01; and
(viii) any other amounts required to be deposited hereunder.
In addition, with respect to any Mortgage Loan that is subject to a
buydown agreement, on each Due Date for such Mortgage Loan, in addition to the
monthly payment remitted by the Mortgagor, the Master Servicer shall cause
funds to be deposited into the Certificate Account in an amount required to
cause an amount of interest to be paid with respect to such Mortgage Loan
equal to the amount of interest that has accrued on such Mortgage Loan from
the preceding Due Date at the Mortgage Rate net of the Master Servicing Fee on
such date.
The foregoing requirements for remittance by the Master Servicer
shall be exclusive, it being understood and agreed that, without limiting the
generality of the foregoing, payments in the nature of prepayment penalties,
late payment charges of assumption fees, if collected, need not be remitted by
the Master Servicer. In the event that the Master Servicer shall remit any
amount not required to be remitted, it may at any time withdraw such amount
from the CertificateAccount, any provision herein to the contrary
notwithstanding. Such withdrawl or direction may be accomplished by delivering
written notice thereof to the Trustee or such other institution maintaining
the Certificate Account which describes the amounts deposited in error in the
Certificate Account. The Master Servicer shall maintain adequate records with
respect to all withdrawals made pursuant to this Section 3.06. All funds
deposited in the Certificate Account shall be held in trust for the
Certificateholders until withdrawn in accordance with Section 3.09.
(e) (i) The Trustee shall establish and maintain the Excess Reserve
Fund Account, on behalf of the Class X Certificateholders, to secure their
limited recourse obligation to pay to the Adjustable Rate Certificateholders
Basis Risk CarryForward Amounts.
(ii) On the Closing Date, the Depositor shall deposit into the
Excess Reserve Fund Account $10,000.
(iii) On each Distribution Date, the Trustee shall deposit the
amount of any Basis Risk Payment for such date into the Excess
Reserve Fund Account.
(iv) The Trustee shall invest amounts held in the Excess Reserve
Fund Account only in Permitted Investments. The Class X
Certificateholder shall direct the Trustee in writing with respect
to investment of amounts in the Excess Reserve Fund. In the absence
of such written direction, all funds in the Excess Reserve Fund
Account shall be invested by the Trustee in the Bank of New York
Cash Reserve Fund.
(f) (i) (A) On each Distribution Date the Required Reserve Fund
Deposit shall be deposited in the Excess Reserve Fund Account.
(B) On each Distribution Date on which there exists a Basis Risk
CarryForward Amount on any Class of Certificates, the Trustee shall
withdraw from the Excess Reserve Fund Account amounts necessary to
pay to such Class or Classes of Certificates the Basis Risk
CarryForward Amount. Such payments shall be allocated to those
Classes on a pro rata basis based upon the amount of Basis Risk
CarryForward Amount owed to each such Class and shall be paid in the
priority set forth in Section 4.02(iii)(j) hereof..
(ii) The Trustee shall account for the Excess Reserve Fund
Account as an outside reserve fund within the meaning of Treasury
regulation 1.860G-2(h) and not an asset of any REMIC created
pursuant to this Agreement. The owner of the Excess Reserve Fund
Account is the Class X Certificateholder. For all Federal tax
purposes, amounts transferred by the Upper Tier REMIC to the Excess
Reserve Fund Account shall be treated as distributions by the
Trustee to the Class X Certificateholder.
(iii) The Master Servicer, on any Distribution Date on which the
amounts in the Excess Reserve Fund are insufficient to pay Basis
Risk CarryForward Amounts in full (including any amounts deposited
in such fund on such Distribution Date), shall advance to the Excess
Reserve Fund an amount equal to the lesser of (a) the Basis Risk
CarryForward Amount that would not otherwise be paid on such
Distribution Date and (b) the amount of its Extra Master Servicing
Fee otherwise payable on such Distribution Date.
(iv) Any Basis Risk CarryForward Amounts paid by the Trustee to
the Adjustable Rate Certificateholders shall be accounted for by the
Trustee as amounts paid to the Holders of the Class X Certificate.
In addition, the Trustee shall account for the Adjustable Rate
Certificateholders rights to receive payments of Basis Risk
CarryForward Amounts as rights in a limited recourse interest rate
cap contract written by the Class X Certificateholders in favor of
the Adjustable Rate Certificateholders.
(v) Notwithstanding any provision contained in this Agreement,
the Trustee shall not be required to make any payments from the
Excess Reserve Fund Account except as expressly set forth in this
Section 3.06(d).
(g) The Trustee shall establish and maintain the Distribution
Account on behalf of the Certificateholders. The Trustee shall, promptly upon
receipt, deposit in the Distribution Account and retain therein the following:
(i) the aggregate amount remitted by the Master Servicer to the
Trustee pursuant to Section 3.09(a);
(ii) any amount deposited by the Master Servicer pursuant to
Section 3.06(h) in connection with any losses on Permitted
Investments; and
(iii) any other amounts deposited hereunder which are required
to be deposited in the Distribution Account.
In the event that the Master Servicer shall remit any amount not
required to be remitted, it may at any time direct the Trustee in writing
to withdraw such amount from the Distribution Account, any provision
herein to the contrary notwithstanding. Such direction may be
accomplished by delivering an Officer's Certificate to the Trustee which
describes the amounts deposited in error in the distribution Account. All
funds deposited in the Distribution Account shall be held by the Trustee
in trust for the Certificateholders until disbursed in accordance with
this Agreement or withdrawn in accordance with Section 3.09. In no event
shall the Trustee incur liability for withdrawals from the Distribution
Account at the direction of the Master Servicer.
(h) (1) Each institution at which the Certificate Account or
Distribution Account is maintained shall invest the funds therein as directed
in writing by the Master Servicer in Permitted Investments, which shall mature
not later than (i) in the case of the Certificate Account, the second Business
Day next preceding the related Distribution Account Deposit Date (except that
if such Permitted Investment is an obligation of the institution that
maintains such account, then such Permitted Investment shall mature not later
than the Business Day next preceding such Distribution Account Deposit Date)
and (ii) in the case of the Distribution Account, the Business Day next
preceding the Distribution Date (except that if such Permitted Investment is
an obligation of the institution that maintains such account, then such
Permitted Investment shall mature not later than such Distribution Date) and,
in each case, shall not be sold or disposed of prior to its maturity. All such
Permitted Investments shall be made in the name of the Trustee, for the
benefit of the Certificateholders. All income and gain (net of any losses)
realized from any such investment of funds on deposit in the Certificate
Account or the Distribution Account shall be for the benefit of the Master
Servicer as servicing compensation and shall be remitted to it monthly as
provided herein. The amount of any realized losses in the Certificate Account
or the Distribution Account incurred in any such account in respect of any
such investments shall promptly be deposited by the Master Servicer in the
Certificate Account or paid to the Trustee for deposit into the Distribution
Account, as applicable. The Trustee shall not be liable for the amount of any
loss incurred in respect of any investment or lack of investment of funds held
in the Certificate Account or the Distribution Account and made in accordance
with this Section 3.06.
(2) The Trustee shall invest funds in the Capitalized Interest
Accounts or Pre-Funding Accounts as directed in writing by the Master Servicer
in Permitted Investments, which shall mature not later than the Business Day
next preceding the Distribution Date (except that if such Permitted Investment
is an obligation of the institution that maintains such account, then such
Permitted Investment shall mature not later than such Distribution Date) and,
in each case, shall not be sold or disposed of prior to its maturity. All such
Permitted Investments shall be made in the name of the Trustee, for the
benefit of the Certificateholders.
(i) The Trustee shall establish and maintain, on behalf of the
Certificateholders, two separate accounts denominated the Group 1 Pre-Funding
Account and the Group 2 Pre-Funding Account in the name of the Trustee. Each
of the Pre-Funding Accounts shall be treated as an "outside reserve fund"
under applicable Treasury regulations and shall not be part of any REMIC. Any
investment earnings on the Pre-Funding Accounts shall be treated as owned by
the Seller and will be taxable to the Seller. On the Closing Date the Seller
shall remit $43,579,868 to the Trustee for deposit in the Pre-Funding
Accounts. The Trustee shall allocate (i) $19,329,797 of the such amount to the
Group 1 Pre-Funding Account for the purchase of Subsequent Mortgage Loans to
be included in Loan Group 1 and (ii) $24,250,071 of the such amount to the
Group 2 Pre-Funding Account for the purchase of Subsequent Mortgage Loans to
be included in Loan Group 2.
The Trustee shall establish and maintain, on behalf of the
Certificateholders, two separate accounts denominated the Group 1 Capitalized
Interest Account and the Group 2 Capitalized Interest Account in the name of
the Trustee. Each of the Capitalized Interest Accounts shall be treated as an
"outside reserve fund" under applicable Treasury regulations and shall not be
part of the REMIC. Any investment earnings on the Capitalized Interest
Accounts shall be treated as owned by the Seller and will be taxable to the
Seller.
On each Subsequent Transfer Date, upon satisfaction of the
conditions set forth in Section 2.09 hereof, the Trustee shall withdraw from
the related Pre-Funding Accounts an amount equal to 100% of the aggregate of
the Cut-off Date Principal Balances of the Subsequent Mortgage Loans sold to
the Trust Fund for inclusion in Loan Group 1 or Loan Group 2, as the case may
be, on such Subsequent Transfer Date and pay such amount to or upon the order
of the Seller.
On the Business Day prior to the Distribution Date immediately
following the Remittance Period in which the Pre-Funding Period ends, the
Trustee shall (i) withdraw the Unutilized Pre-Funding Amount, if any, from
each of the Pre-Funding Accounts, (ii) promptly deposit each amount in the
Distribution Account and (iii) distribute each amount to the related
Certificate Group on such Distribution Date pursuant to Section 4.02 hereof.
The amount deposited in the Distribution Account pursuant to the
preceding paragraph shall be net of any investment earnings on the amounts on
deposit in the Pre-Funding Accounts.
On the Business Day prior to each Distribution Date, through the
Distribution Date immediately following the Remittance Period in which the
Pre-Funding Period ends, the Trustee shall transfer from each Pre-Funding
Account to the Distribution Account the investment earnings on the amounts on
deposit in the Pre-Funding Accounts, if any, and shall distribute such amount
to the related Certificate Group on such Distribution Date pursuant to Section
4.02 hereof.
On the Business Day prior to each Distribution Date, through the
Distribution Date immediately following the Remittance Period in which the
Pre-Funding Period ends, the Trustee shall transfer from each Capitalized
Interest Account to the Distribution Account the related Capitalized Interest
Requirement and the investment earnings on the amounts on deposit in the
Capitalized Interest Accounts, if any, and shall distribute such amount to the
related Certificate Group on such Distribution Date pursuant to Section 4.02
hereof.
All amounts, if any, remaining in the Capitalized Interest Accounts
on the Distribution Date following the Remittance Period in which the
Pre-Funding Period ends shall be transferred to the Seller on such date.
(j) The Master Servicer shall give notice to the Trustee, the
Seller, each Rating Agency and the Depositor of any proposed change of the
location of the Certificate Account and the Collection Account not later than
30 days and not more than 45 days prior to any change thereof.
Section 3.07. Collection of Taxes, Assessments and Similar Items;
Escrow Accounts.
(a) To the extent required by the related Mortgage Note and not
violative of current law, the Master Servicer shall establish and maintain one
or more accounts (each, an "Escrow Account") and deposit and retain therein
all collections from the Mortgagors (or advances) for the payment of taxes,
assessments, hazard insurance premiums or comparable items for the account of
the Mortgagors. Nothing herein shall require the Master Servicer to compel a
Mortgagor to establish an Escrow Account in violation of applicable law.
(b) Withdrawals of amounts so collected from the Escrow Accounts may
be made only to effect timely payment of taxes, assessments, hazard insurance
premiums, condominium or PUD association dues, or comparable items, to
reimburse (without duplication) the Master Servicer out of related collections
for any payments made pursuant to Sections 3.12 (with respect to taxes and
assessments and insurance premiums) and 3.13 (with respect to hazard
insurance), to refund to any Mortgagors any sums determined to be overages, to
pay interest, if required by law or the terms of the related Mortgage or
Mortgage Note, to Mortgagors on balances in the Escrow Account or to clear and
terminate the Escrow Account at the termination of this Agreement in
accordance with Section 9.01. The Escrow Accounts shall not be a part of the
Trust Fund.
(c) The Master Servicer shall advance any payments referred to in
Section 3.07(a) that are not timely paid by the Mortgagors or advanced by the
Master Servicer on the date when the tax, premium or other cost for which such
payment is intended is due, but the Master Servicer shall be required so to
advance only to the extent that such advances, in the good faith judgment of
the Master Servicer, will be recoverable by the Master Servicer out of
Insurance Proceeds, Liquidation Proceeds or otherwise.
Section 3.08. Access to Certain Documentation and Information
Regarding the Mortgage Loans.
The Master Servicer shall afford the Depositor and the Trustee
reasonable access to all records and documentation regarding the Mortgage
Loans and all accounts, insurance information and other matters relating to
this Agreement, such access being afforded without charge, but only upon
reasonable request and during normal business hours at the office designated
by the Master Servicer.
Upon reasonable advance notice in writing, the Master Servicer will
provide to each Certificateholder which is a savings and loan association,
bank or insurance company certain reports and reasonable access to information
and documentation regarding the Mortgage Loans sufficient to permit such
Certificateholder to comply with applicable regulations of the OTS or other
regulatory authorities with respect to investment in the Certificates;
provided that the Master Servicer shall be entitled to be reimbursed by each
such Certificateholder for actual expenses incurred by the Master Servicer in
providing such reports and access.
Section 3.09. Permitted Withdrawals from the Certificate Account, the
Distribution Account and the Excess Reserve Fund Account.
(a) The Master Servicer may (and, in the case of clause (ix) below,
shall) from time to time make withdrawals from the Certificate Account for the
following purposes:
(i) to pay to the Master Servicer or the related Subservicer (to
the extent not previously retained) the servicing compensation to
which it is entitled pursuant to Section 3.15, and to pay to the
Master Servicer, as additional master servicing compensation,
earnings on or investment income with respect to funds in or
credited to the Certificate Account;
(ii) to reimburse the Master Servicer for unreimbursed Advances
made by it, such right of reimbursement pursuant to this subclause
(ii) being limited to amounts received on the Mortgage Loan(s) in
respect of which such Advance was made;
(iii) to reimburse the Master Servicer for any Nonrecoverable
Advance previously made;
(iv) to reimburse the Master Servicer for Insured Expenses from
the related Insurance Proceeds;
(v) to reimburse the Master Servicer for (a) unreimbursed
Servicing Advances, the Master Servicer's right to reimbursement
pursuant to this clause (a) with respect to any Mortgage Loan being
limited to amounts received on such Mortgage Loan(s) which represent
late recoveries of the payments for which such advances were made
pursuant to Section 3.01 or Section 3.07 and (b) for unpaid Master
Servicing Fees as provided in Section 3.12;
(vi) to pay to the purchaser, with respect to each Mortgage Loan
or property acquired in respect thereof that has been purchased
pursuant to Section 2.02, 2.03 or 3.14, all amounts received thereon
after the date of such purchase;
(vii) to reimburse the Seller, the Master Servicer or the
Depositor for expenses incurred by any of them and reimbursable
pursuant to Section 6.03;
(viii) to withdraw any amount deposited in the Certificate
Account and not required to be deposited therein;
(ix) on or prior to the Distribution Account Deposit Date, to
withdraw an amount equal to the related Available Funds for both
Loan Groups and the Trustee Fee for such Distribution Date, to the
extent on deposit, and remit such amount to the Trustee for deposit
in the Distribution Account; and
(x) to clear and terminate the Certificate Account upon
termination of this Agreement pursuant to Section 9.01.
The Master Servicer shall keep and maintain separate accounting, on
a Mortgage Loan by Mortgage Loan basis, for the purpose of justifying any
withdrawal from the Certificate Account pursuant to such subclauses (i), (ii),
(iv), (v) and (vi). Prior to making any withdrawal from the Certificate
Account pursuant to subclause (iii), the Master Servicer shall deliver to the
Trustee an Officer's Certificate of a Servicing Officer indicating the amount
of any previous Advance determined by the Master Servicer to be a
Nonrecoverable Advance and identifying the related Mortgage Loan(s) and their
respective portions of such Nonrecoverable Advance.
(b) The Trustee shall withdraw funds from the Distribution Account
for distributions to Certificateholders in the manner specified in this
Agreement (and to withhold from the amounts so withdrawn the amount of any
taxes that it is authorized to withhold pursuant to the last paragraph of
Section 8.11). In addition, the Trustee may from time to time make withdrawals
from the Distribution Account for the following purposes:
(ii) to pay to itself the Trustee Fee for the related
Distribution Date;
(iii) to pay to the Master Servicer as additional servicing
compensation earnings on or investment income with respect to funds
in the Distribution Account;
(iv) to withdraw and return to the Master Servicer any amount
deposited in the Distribution Account and not required to be
deposited therein; and
(v) to clear and terminate the Distribution Account upon
termination of the Agreement pursuant to Section 9.01.
(c) On each Distribution Date, the Trustee shall make withdrawals
from the Excess Reserve Fund Account for deposit in the Distribution Account
an amount equal to the amount required pursuant to Section 3.06(d) above. On
the earlier of (i) the Distribution Date on which all of the Adjustable Rate
Certificates are reduced to zero and (ii) the termination of this Agreement
pursuant to Section 9.01, any amount remaining on deposit in the Excess
Reserve Fund Account after giving effect to the requirements of the preceding
sentence shall be withdrawn by the Trustee and paid to the Class X
Certificateholders.
Section 3.10. Maintenance of Hazard Insurance; Maintenance of
Primary Insurance Policies.
(a) The Master Servicer shall maintain or cause to be maintained,
for each Mortgage Loan, hazard insurance with extended coverage in an amount
that is at least equal to the lesser of (i) the maximum insurable value of the
improvements securing such Mortgage Loan or (ii) the greater of (y) the
outstanding principal balance of the Mortgage Loan and (z) an amount such that
the proceeds of such policy shall be sufficient to prevent the Mortgagor
and/or the mortgagee from becoming a co-insurer. Each such policy of standard
hazard insurance shall contain, or have an accompanying endorsement that
contains, a standard mortgagee clause. Any amounts collected under any such
policies (other than the amounts to be applied to the restoration or repair of
the related Mortgaged Property or amounts released to the Mortgagor in
accordance with the Master Servicer's normal servicing procedures) shall be
deposited in the Certificate Account. Any cost incurred in maintaining any
such insurance shall not, for the purpose of calculating monthly distributions
to the Certificateholders or remittances to the Trustee for their benefit, be
added to the principal balance of the Mortgage Loan, notwithstanding that the
terms of the Mortgage Loan so permit. Such costs shall be recoverable by the
Master Servicer out of late payments by the related Mortgagor or out of
Liquidation Proceeds to the extent permitted by Section 3.09. It is understood
and agreed that no earthquake or other additional insurance is to be required
of any Mortgagor or maintained on property acquired in respect of a Mortgage
other than pursuant to such applicable laws and regulations as shall at any
time be in force and as shall require such additional insurance. If the
Mortgaged Property is located at the time of origination of the Mortgage Loan
in a federally designated special flood hazard area and such area is
participating in the national flood insurance program, the Master Servicer
shall cause flood insurance to be maintained with respect to such Mortgage
Loan. Such flood insurance shall be in an amount equal to the least of (i) the
original principal balance of the related Mortgage Loan, (ii) the replacement
value of the improvements which are part of such Mortgaged Property, and (iii)
the maximum amount of such insurance available for the related Mortgaged
Property under the national flood insurance program.
In the event that the Master Servicer shall obtain and maintain a
blanket policy insuring against hazard losses on all of the Mortgage Loans, it
shall conclusively be deemed to have satisfied its obligations as set forth in
the first sentence of this Section 3.10, it being understood and agreed that
such policy may contain a deductible clause on terms substantially equivalent
to those commercially available and maintained by comparable servicers. If
such policy contains a deductible clause, the Master Servicer shall, in the
event that there shall not have been maintained on the related Mortgaged
Property a policy complying with the first sentence of this Section 3.10, and
there shall have been a loss that would have been covered by such policy,
deposit in the Certificate Account the amount not otherwise payable under the
blanket policy because of such deductible clause. In connection with its
activities as Master Servicer of the Mortgage Loans, the Master Servicer
agrees to present, on behalf of itself, the Depositor, and the Trustee for the
benefit of the Certificateholders, claims under any such blanket policy.
(b) The Master 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 Master Servicer, would have been covered
thereunder. The Master Servicer shall not cancel or refuse to renew any such
Primary Insurance Policy that is in effect at the date of the initial issuance
of the Certificates and is required to be kept in force hereunder unless the
replacement Primary Insurance Policy for such canceled or non-renewed policy
is maintained with a Qualified Insurer. The Master Servicer shall not be
required to maintain any Primary Insurance Policy (i) with respect to any
Mortgage Loan with a Loan-to-Value Ratio of Combined Loan-to-Value Ratio (as
applicable) less than or equal to 80% as of any date of determination or,
based on a new appraisal, the principal balance of such Mortgage Loan
represents 80% or less of the new Appraised Value or (ii) if maintaining such
Primary Insurance Policy is prohibited by applicable law. The Master Servicer
agrees, to the extent permitted by applicable law, to effect the timely
payment of the premiums on each Primary Insurance Policy, and such costs not
otherwise recoverable shall be recoverable by the Master Servicer from the
related liquidation proceeds.
In connection with its activities as Master Servicer of the Mortgage
Loans, the Master Servicer agrees to present, on behalf of itself, the Trustee
and the Certificateholders, claims to the insurer under any Primary Insurance
Policies and, in this regard, to take such reasonable action in accordance
with the Servicing Standard as shall be necessary to permit recovery under any
Primary Insurance Policies respecting defaulted Mortgage Loans. Any amounts
collected by the Master Servicer under any Primary Insurance Policies shall be
deposited in the Certificate Account or the Collection Account (as
applicable).
Section 3.11. Enforcement of Due-On-Sale Clauses; Assumption
Agreements.
(a) Except as otherwise provided in this Section 3.11, when any
property subject to a Mortgage has been conveyed by the Mortgagor, the Master
Servicer shall to the extent that it has knowledge of such conveyance and in
accordance with the Servicing Standard, enforce any due-on-sale clause
contained in any Mortgage Note or Mortgage, to the extent permitted under
applicable law and governmental regulations, but only to the extent that such
enforcement will not adversely affect or jeopardize coverage under any
Required Insurance Policy. Notwithstanding the foregoing, the Master Servicer
is not required to exercise such rights with respect to a Mortgage Loan if the
Person to whom the related Mortgaged Property has been conveyed or is proposed
to be conveyed satisfies the terms and conditions contained in the Mortgage
Note and Mortgage related thereto and the consent of the mortgagee under such
Mortgage Note or Mortgage is not otherwise so required under such Mortgage
Note or Mortgage as a condition to such transfer. In the event that (i) the
Master Servicer is prohibited by law from enforcing any such due-on-sale
clause, (ii) coverage under any Required Insurance Policy would be adversely
affected, (iii) the Mortgage Note does not include a due-on-sale clause or
(iv) nonenforcement is otherwise permitted hereunder, the Master Servicer is
authorized, subject to Section 3.11(b), to take or enter into an assumption
and modification agreement from or 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 state law, the
Mortgagor remains liable thereon, provided that the Mortgage Loan shall
continue to be covered (if so covered before the Master Servicer enters such
agreement) by the applicable Required Insurance Policies. The Master Servicer,
subject to Section 3.11(b), is also authorized with the prior approval of the
insurers under any Required Insurance Policies 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 Mortgage Note. Notwithstanding the foregoing, the
Master Servicer shall not be deemed to be in default under this Section 3.11
by reason of any transfer or assumption which the Master Servicer reasonably
believes it is restricted by law from preventing, for any reason whatsoever.
(b) Subject to the Master Servicer's duty to enforce any due-on-sale
clause to the extent set forth in Section 3.11(a), in any case in which a
Mortgaged Property has been conveyed to a Person by a Mortgagor, and such
Person is to enter into an assumption agreement or modification agreement or
supplement to the Mortgage Note or Mortgage that requires the signature of the
Trustee, or if an instrument of release signed by the Trustee is required
releasing the Mortgagor from liability on the Mortgage Loan, the Master
Servicer shall prepare and deliver or cause to be prepared and delivered to
the Trustee for signature and shall direct, in writing, the Trustee to execute
the assumption agreement with the Person to whom the Mortgaged Property is to
be conveyed and such modification agreement or supplement to the Mortgage Note
or Mortgage or other instruments as are reasonable or necessary to carry out
the terms of the Mortgage Note or Mortgage or otherwise to comply with any
applicable laws regarding assumptions or the transfer of the Mortgaged
Property to such Person. In connection with any such assumption, no material
term of the Mortgage Note may be changed. In addition, the substitute
Mortgagor and the Mortgaged Property must be acceptable to the Master Servicer
in accordance with its underwriting standards as then in effect. Together with
each such substitution, assumption or other agreement or instrument delivered
to the Trustee for execution by it, the Master Servicer shall deliver an
Officer's Certificate signed by a Servicing Officer stating that the
requirements of this subsection have been met in connection therewith. The
Master Servicer shall notify the Trustee that any such substitution or
assumption agreement has been completed by forwarding to the Trustee the
original of such substitution or assumption agreement, which in the case of
the original shall be added to the related Mortgage File and shall, for all
purposes, be considered a part of such Mortgage File to the same extent as all
other documents and instruments constituting a part thereof. Any fee collected
by the Master Servicer for entering into an assumption or substitution of
liability agreement will be retained by the Master Servicer as additional
master servicing compensation.
Section 3.12. Realization Upon Defaulted Mortgage Loans; Repurchase
of Certain Mortgage Loans.
(a) The Master Servicer shall use reasonable efforts in accordance
with the Servicing Standard to foreclose upon or otherwise comparably convert
the ownership of Mortgaged Properties in respect of which the related Mortgage
Loans as come into and continue in default and as to which no satisfactory
arrangements can be made for collection of delinquent payments. In connection
with such foreclosure or other conversion, the Master Servicer shall follow
the Servicing Standard and shall follow the requirements of the insurer under
any Required Insurance Policy. Notwithstanding the foregoing, the Master
Servicer shall not be required to expend its own funds in connection with any
foreclosure or towards the restoration of any property unless it shall
determine (i) that such restoration and/or foreclosure will increase the
proceeds of liquidation of the Mortgage Loan after reimbursement to itself of
such expenses and (ii) that such expenses will be recoverable to it through
Liquidation Proceeds (respecting which it shall have priority for purposes of
withdrawals from the Certificate Account). The Master Servicer shall be
responsible for all other costs and expenses incurred by it in any such
proceedings; provided, however, that it shall be entitled to reimbursement
thereof from the liquidation proceeds with respect to the related Mortgaged
Property, as provided in the definition of Liquidation Proceeds. If the Master
Servicer has knowledge that a Mortgaged Property which the Master Servicer is
contemplating acquiring in foreclosure or by deed in lieu of foreclosure is
located within a 1 mile radius of any site listed in the Expenditure Plan for
the Hazardous Substance Clean Up Bond Act of 1984 or other site with
environmental or hazardous waste risks known to the Master Servicer, the
Master Servicer will, prior to acquiring the Mortgaged Property, consider such
risks and only take action in accordance with its established environmental
review procedures.
With respect to any REO Property, the deed or certificate of sale
shall be taken in the name of the Trustee for the benefit of the
Certificateholders, or its nominee, on behalf of the Certificateholders. The
Trustee's name shall be placed on the title to such REO Property solely as the
Trustee hereunder and not in its individual capacity. The Master Servicer
shall ensure that the title to such REO Property references the Pooling and
Servicing Agreement and the Trustee's capacity hereunder. Pursuant to its
efforts to sell such REO Property, the Master Servicer shall either itself or
through an agent selected by the Master Servicer protect and conserve such REO
Property in accordance with the Servicing Standard and may, incident to its
conservation and protection of the interests of the Certificateholders, rent
the same, or any part thereof, as the Master Servicer deems to be in the best
interest of the Certificateholders for the period prior to the sale of such
REO Property. The Master Servicer shall prepare for and deliver to the Trustee
a statement with respect to each REO Property that has been rented showing the
aggregate rental income received and all expenses incurred in connection with
the management and maintenance of such REO Property at such times as is
necessary to enable the Trustee to comply with the reporting requirements of
the REMIC Provisions. The net monthly rental income, if any, from such REO
Property shall be deposited in the Certificate Account no later than the close
of business on each Determination Date. The Master Servicer shall perform the
tax reporting and withholding required by Sections 1445 and 6050J of the Code
with respect to foreclosures and abandonments, the tax reporting required by
Section 6050H of the Code with respect to the receipt of mortgage interest
from individuals and, if required by Section 6050P of the Code with respect to
the cancellation of indebtedness by certain financial entities, by preparing
such tax and information returns as may be required, in the form required, and
delivering the same to the Trustee for filing.
In the event that the Trust Fund acquires any Mortgaged Property as
aforesaid or otherwise in connection with a default or imminent default on a
Mortgage Loan, the Master Servicer shall dispose of such Mortgaged Property
prior to three years after its acquisition by the Trust Fund unless the
Trustee shall have been supplied with an Opinion of Counsel to the effect that
the holding by the Trust Fund of such Mortgaged Property subsequent to such
two-year period will not result in the imposition of taxes on "prohibited
transactions" on any REMIC as defined in section 860F of the Code or cause any
REMIC 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 Mortgaged
Property (subject to any conditions contained in such Opinion of Counsel).
Notwithstanding any other provision of this Agreement, no Mortgaged Property
acquired by the Trust Fund shall be rented (or allowed to continue to be
rented) or otherwise used for the production of income by or on behalf of the
Trust Fund in such a manner or pursuant to any terms that would (i) cause such
Mortgaged Property to fail to qualify as "foreclosure property" within the
meaning of Section 860G(a)(8) of the Code or (ii) subject any REMIC to the
imposition of any federal, state or local income taxes on the income earned
from such Mortgaged Property under Section 860G(c) of the Code or otherwise,
unless the Master Servicer has agreed to indemnify and hold harmless the Trust
Fund with respect to the imposition of any such taxes.
The decision of the Master Servicer to foreclose on a defaulted
Mortgage Loan shall be subject to a determination by the Master Servicer that
the proceeds of such foreclosure would exceed the costs and expenses of
bringing such a proceeding. The income earned from the management of any REO
Properties, net of reimbursement to the Master Servicer for expenses incurred
(including any property or other taxes) in connection with such management and
net of unreimbursed Master Servicing Fees, Advances and Servicing Advances,
shall be applied to the payment of principal of and interest on the related
defaulted Mortgage Loans (with interest accruing as though such Mortgage Loans
were still current and adjustments, if applicable, to the Mortgage Rate were
being made in accordance with the terms of the Mortgage Note) and all such
income shall be deemed, for all purposes in this Agreement, to be payments on
account of principal and interest on the related Mortgage Notes and shall be
deposited into the Certificate Account. To the extent the net income received
during any calendar month is in excess of the amount attributable to
amortizing principal and accrued interest at the related Mortgage Rate on the
related Mortgage Loan for such calendar month, such excess shall be considered
to be a partial prepayment of principal of the related Mortgage Loan.
The proceeds from any liquidation of a Mortgage Loan, as well as any
income from an REO Property, will be applied in the following order of
priority: first, to reimburse the Master Servicer for any related unreimbursed
Servicing Advances or Master Servicing Fees, as applicable; second, to
reimburse the Master Servicer, as applicable, and to reimburse the Certificate
Account for any Nonrecoverable Advances (or portions thereof) that were
previously withdrawn by the Master Servicer pursuant to Section 3.09(a)(ii)
that related to such Mortgage Loan; third, to accrued and unpaid interest (to
the extent no Advance has been made for such amount or any such Advance has
been reimbursed) on the Mortgage Loan or related REO Property, at the Adjusted
Net Mortgage Rate through the Remittance Period preceding the Distribution
Date on which such amounts are required to be distributed; and fourth, as a
recovery of principal of the Mortgage Loan. Excess Proceeds, if any, from the
liquidation of a Liquidated Mortgage Loan will be retained by the Master
Servicer as additional servicing compensation pursuant to Section 3.15.
(b) The Master Servicer, in its sole discretion, shall have the
right to purchase for its own account from the Trust Fund any Mortgage Loan
which is 91 days or more delinquent at a price equal to the Purchase Price.
The Purchase Price for any Mortgage Loan purchased hereunder shall be
deposited in the Certificate Account and the Trustee, upon receipt of a
certificate from the Master Servicer in the form of Exhibit N hereto, shall
release or cause to be released to the purchaser of such Mortgage Loan the
related Mortgage File and shall execute and deliver such instruments of
transfer or assignment prepared by the purchaser of such Mortgage Loan, in
each case without recourse, as shall be necessary to vest in the purchaser of
such Mortgage Loan any Mortgage Loan released pursuant hereto and the
purchaser of such Mortgage Loan shall succeed to all the Trustee's right,
title and interest in and to such Mortgage Loan and all security and documents
related thereto. Such assignment shall be an assignment outright and not for
security. The purchaser of such Mortgage Loan shall thereupon own such
Mortgage Loan, and all security and documents, free of any further obligation
to the Trustee or the Certificateholders with respect thereto.
(c) The Master Servicer may agree to a modification of any Mortgage
Loan (the "Relevant Mortgage Loan") upon the request of the related Mortgagor,
provided that the modification is in lieu of a refinancing and the Mortgage
Rate on the Relevant Mortgage Loan, as modified, is approximately a prevailing
market rate for newly-originated mortgage loans having similar terms and (ii)
the Master Servicer purchases the Relevant Mortgage Loan from the Trust Fund
as described below. Effective immediately after such modification, and, in any
event, on the same Business Day on which the modification occurs, all right,
title and interest of the Trustee in and to the Modified Mortgage Loan shall
automatically be deemed transferred and assigned to the Master Servicer and
all benefits and burdens of ownership thereof, including without limitation
the right to accrued interest thereon from and including the date of
modification and the risk of default thereon, shall pass to the Master
Servicer. The Master Servicer shall promptly deliver to the Trustee a
certification of a Servicing Officer to the effect that all requirements of
the first paragraph of this subsection (c) have been satisfied with respect to
such Modified Mortgage Loan.
The Master Servicer shall deposit the Purchase Price for any
Modified Mortgage Loan in the Certificate Account pursuant to Section 3.06
within one Business Day after the purchase of such Modified Mortgage Loan.
Upon receipt by the Trustee of written notification of any such deposit signed
by a Servicing Officer, the Trustee shall release to the Master Servicer the
related Mortgage File and shall execute and deliver such instruments of
transfer or assignment, in each case without recourse, as shall be necessary
to vest in the Master Servicer any Modified Mortgage Loan previously
transferred and assigned pursuant hereto.
The Master Servicer covenants and agrees to indemnify the Trust Fund
against any and all liability for any "prohibited transaction" taxes and any
related interest, additions and penalties imposed on the Trust Fund
established hereunder as a result of any modification of a Mortgage Loan
effected pursuant to this subsection (c), any holding of a Modified Mortgage
Loan by the Trust Fund or any purchase of a Modified Mortgage Loan by the
Master Servicer (but such obligation shall not prevent the Master Servicer or
any other appropriate Person from contesting any such tax in appropriate
proceedings and shall not prevent the Master Servicer from withholding payment
of such tax, if permitted by law, pending the outcome of such proceedings).
The Master Servicer shall have no right of reimbursement for any amount paid
pursuant to the foregoing indemnification, except to the extent that the
amount of any tax, interest and penalties, together with interest thereon, is
refunded to the Trust Fund or the Master Servicer.
Section 3.13. Trustee to Cooperate; Release of Mortgage Files.
Upon the payment in full of any Mortgage Loan, or the receipt by the
Master Servicer of a notification that payment in full will be escrowed in a
manner customary for such purposes, the Master Servicer will immediately
notify the Trustee by delivering, or causing to be delivered, a "Request for
Release" substantially in the form of Exhibit N. Upon receipt of such request,
the Trustee shall promptly release the related Mortgage File to the Master
Servicer, and the Trustee shall at the Master Servicer's direction execute and
deliver to the Master Servicer the request for reconveyance, deed of
reconveyance or release or satisfaction of mortgage or such instrument
releasing the lien of the Mortgage in each case provided by the Master
Servicer, together with the Mortgage Note with written evidence of
cancellation thereon. Expenses incurred in connection with any instrument of
satisfaction or deed of reconveyance shall be chargeable to the related
Mortgagor. From time to time and as shall be appropriate for the servicing or
foreclosure of any Mortgage Loan, including for such purpose collection under
any policy of flood insurance, any fidelity bond or errors or omissions
policy, or for the purposes of effecting a partial release of any Mortgaged
Property from the lien of the Mortgage or the making of any corrections to the
Mortgage Note or the Mortgage or any of the other documents included in the
Mortgage File, the Trustee shall, upon delivery to the Trustee of a Request
for Release in the form of Exhibit M signed by a Servicing Officer, release
the Mortgage File to the Master Servicer or its designee. Subject to the
further limitations set forth below, the Master Servicer shall cause the
Mortgage File or documents so released to be returned to the Trustee when the
need therefor by the Master Servicer no longer exists, unless the Mortgage
Loan is liquidated and the proceeds thereof are deposited in the Certificate
Account, in which case the Master Servicer shall deliver to the Trustee a
Request for Release in the form of Exhibit N, signed by a Servicing Officer.
If the Master Servicer at any time seeks to initiate a foreclosure
proceeding in respect of any Mortgaged Property as authorized by this
Agreement, the Master Servicer shall deliver or cause to be delivered to the
Trustee, for signature, as appropriate, any court pleadings, requests for
trustee's sale or other documents necessary to effectuate such foreclosure or
any legal action brought to obtain judgment against the Mortgagor on the
Mortgage Note or the Mortgage or to obtain a deficiency judgment or to enforce
any other remedies or rights provided by the Mortgage Note or the Mortgage or
otherwise available at law or in equity.
Section 3.14. Documents, Records and Funds in Possession of the
Master Servicer to be Held for the Trustee.
The Master Servicer shall account fully to the Trustee for any funds
received by the Master Servicer or which otherwise are collected by the Master
Servicer as Liquidation Proceeds or Insurance Proceeds in respect of any
Mortgage Loan. All Mortgage Files and funds collected or held by, or under the
control of, the Master Servicer in respect of any Mortgage Loans, whether from
the collection of principal and interest payments or from Liquidation
Proceeds, including but not limited to, any funds on deposit in the
Certificate Account, shall be held by the Master Servicer for and on behalf of
the Trustee and shall be and remain the sole and exclusive property of the
Trustee, subject to the applicable provisions of this Agreement. The Master
Servicer also agrees that it shall not create, incur or subject any Mortgage
File or any funds that are deposited in the Certificate Account, the
Collection Account, Distribution Account or any Escrow Account, or any funds
that otherwise are or may become due or payable to the Trustee for the benefit
of the Certificateholders, to any claim, lien, security interest, judgment,
levy, writ of attachment or other encumbrance, or assert by legal action or
otherwise any claim or right of setoff against any Mortgage File or any funds
collected on, or in connection with, a Mortgage Loan, except, however, that
the Master Servicer shall be entitled to set off against and deduct from any
such funds any amounts that are properly due and payable to the Master
Servicer under this Agreement.
Section 3.15. Servicing Compensation.
As compensation for its activities hereunder, the Master Servicer
shall be entitled to retain or withdraw from the Servicing Account, the
Collection Account or the Certificate Account an amount equal to the Master
Servicing Fee for each Mortgage Loan for the related Distribution Date.
Notwithstanding the foregoing, the aggregate Master Servicing Fee and
Servicing Fee payable to the Master Servicer shall be reduced by an amount
equal to the aggregate of the Prepayment Interest Shortfalls, if any, with
respect to such Distribution Date; provided, however, that the reduction for
any Distribution Date shall not exceed the aggregate Compensating Interest for
such Distribution Date.
The Master Servicer shall also be entitled to retain or withdraw
from the Servicing Account, the Collection Account or the Certificate Account
an amount equal to the Servicing Fee for each Mortgage Loan for the related
Distribution Date. In cases where a Mortgage Loan is being directly serviced
by the Master Servicer, the Master Servicer shall be entitled to retain such
amount for its own account as compensation for performing such services. In
cases where a Mortgage Loan is being directly serviced by a Subservicer, the
Master Servicer shall (unless the Servicing Fee has been retained by the
Subservicer) remit such amount to the related Subservicer as compensation for
performing such services.
Additional master servicing compensation in the form of Excess
Proceeds, prepayment penalties, assumption fees, late payment charges and all
income and gain net of any losses realized from Permitted Investments shall be
retained by the Master Servicer to the extent not required to be deposited in
the Certificate Account pursuant to Section 3.06. The Master Servicer shall be
required to pay all expenses incurred by it in connection with its servicing
activities hereunder (including the fees of any Subservicer, payment of any
premiums for hazard insurance and any Primary Insurance Policy and maintenance
of the other forms of insurance coverage required by this Agreement) and shall
not be entitled to reimbursement therefor except as specifically provided in
this Agreement.
Section 3.16. Access to Certain Documentation.
The Master Servicer shall provide to the OTS and the FDIC and to
comparable regulatory authorities supervising Holders of Subordinated
Certificates and the examiners and supervisory agents of the OTS, the FDIC and
such other authorities, access to the documentation regarding the Mortgage
Loans required by applicable regulations of the OTS and the FDIC. Such access
shall be afforded without charge, but only upon reasonable and prior written
request and during normal business hours at the offices designated by the
Master Servicer. Nothing in this Section 3.16 shall limit the obligation of
the Master Servicer to observe any applicable law prohibiting disclosure of
information regarding the Mortgagors and the failure of the Master Servicer to
provide access as provided in this Section 3.16 as a result of such obligation
shall not constitute a breach of this Section 3.16.
Section 3.17. Annual Statement as to Compliance.
The Master Servicer shall deliver to the Depositor and the Trustee
on or before 120 days after the end of the Master Servicer's fiscal year,
commencing with its 2000 fiscal year, an Officer's Certificate stating, as to
the signer thereof, that (i) a review of the activities of the Master Servicer
during the preceding calendar year and of the performance of the Master
Servicer under this Agreement has been made under such officer's supervision,
and (ii) to the best of such officer's knowledge, based on such review, the
Master Servicer has fulfilled all its obligations under this Agreement
throughout such year, or, if there has been a default in the fulfillment of
any such obligation, specifying each such default known to such officer and
the nature and status thereof. The Trustee shall forward a copy of each such
statement to each Rating Agency.
Section 3.18. Annual Independent Public Accountants' Servicing
Statement; Financial Statements.
On or before 120 days after the end of the Master Servicer's fiscal
year, commencing with its 2000 fiscal year, the Master Servicer at its expense
shall cause a nationally or regionally recognized firm of independent public
accountants (who may also render other services to the Master Servicer, the
Seller or any affiliate thereof) which is a member of the American Institute
of Certified Public Accountants to furnish a statement to the Trustee and the
Depositor to the effect that such firm has examined certain documents and
records relating to the servicing of the Mortgage Loans under this Agreement
or of mortgage loans under pooling and servicing agreements substantially
similar to this Agreement (such statement to have attached thereto a schedule
setting forth the pooling and servicing agreements covered thereby) and that,
on the basis of such examination, conducted substantially in compliance with
the Audit Guide for Audits of HUD Approved Nonsupervised Mortgagees, the
Uniform Single Attestation Program for Mortgage Bankers or the Audit Program
for Mortgages serviced for FNMA and FHLMC, such servicing has been conducted
in compliance with such pooling and servicing agreements except for such
significant exceptions or errors in records that, in the opinion of such firm,
the Audit Guide for Audits of HUD Approved Nonsupervised Mortgagees, the
Uniform Single Attestation Program for Mortgage Bankers or the Audit Program
for Mortgages serviced for FNMA and FHLMC requires it to report. In rendering
such statement, such firm may rely, as to matters relating to direct servicing
of mortgage loans by the Subservicers, upon comparable statements for
examinations conducted substantially in compliance with the Audit Guide for
Audits of HUD Approved Nonsupervised Mortgagees, the Uniform Single
Attestation Program for Mortgage Bankers or the Audit Program for Mortgages
serviced for FNMA and FHLMC (rendered within one year of such statement) of
independent public accountants with respect to the related Subservicer. Copies
of such statement shall be provided by the Trustee to any Certificateholder
upon request at the Master Servicer's expense, provided that such statement is
delivered by the Master Servicer to the Trustee.
Section 3.19. Errors and Omissions Insurance; Fidelity Bonds.
The Master Servicer shall obtain and maintain in force (a) a policy
or policies of insurance covering errors and omissions in the performance of
its obligations as Master Servicer hereunder and (b) a fidelity bond in
respect of its officers, employees and agents. Each such policy or policies
and bond shall, together, comply with the requirements from time to time of
FNMA or FHLMC for persons performing servicing for mortgage loans purchased by
FNMA or FHLMC. In the event that any such policy or bond ceases to be in
effect, the Master Servicer shall obtain a comparable replacement policy or
bond from an insurer or issuer meeting the requirements set forth above as of
the date of such replacement.
<PAGE>
ARTICLE IV
DISTRIBUTIONS AND
ADVANCES BY THE MASTER SERVICER
Section 4.01. Advances.
The Master Servicer shall determine on or before each Master
Servicer Advance Date whether it is required to make an Advance pursuant to
the definition thereof. If the Master Servicer determines it is required to
make an Advance, it shall, on or before the Master Servicer Advance Date,
either (i) deposit into the Certificate Account an amount equal to the Advance
or (ii) make an appropriate entry in its records relating to the Certificate
Account that any Amount Held for Future Distribution has been used by the
Master Servicer in discharge of its obligation to make any such Advance. Any
funds so applied shall be replaced by the Master Servicer by deposit in the
Certificate Account no later than the close of business on the next Master
Servicer Advance Date. The Master Servicer shall be entitled to be reimbursed
from the Certificate Account for all Advances of its own funds made pursuant
to this Section 4.01 as provided in Section 3.09. The obligation to make
Advances with respect to any Mortgage Loan shall continue if such Mortgage
Loan has been foreclosed or otherwise terminated and the related Mortgaged
Property has not been liquidated. The Master Servicer shall inform the Trustee
of the amount of the Advance to be made on each Master Servicer Advance Date
no later than the second Business Day before the related Distribution Date.
The Master Servicer shall deliver to the Trustee on the related
Master Servicer Advance Date an Officer's Certificate of a Servicing Officer
indicating the amount of any proposed Advance determined by the Master
Servicer to be a Nonrecoverable Advance.
Section 4.02. Priorities of Distribution.
On each Distribution Date, the Trustee will make the disbursements
and transfers from amounts then on deposit in the Distribution Account in the
following order of priority for each Certificate Group and, in each case, to
the extent of the related Available Funds remaining:
(i) to the holders of each Class of Certificates in the following
order of priority:
(a) to the Class R Certificates and each Class of Class A
Certificates for the related Certificate Group, the aggregate of the
related Accrued Certificate Interest Distribution Amount and any Unpaid
Interest Amounts for such Classes, pro rata for such Certificate Group,
based on the amount of interest which each such Class is entitled to
receive on such Distribution Date;
(b) to the Class M-1 Certificates of such Certificate Group, the
Accrued Certificate Interest Distribution Amount for such Class on such
Distribution Date;
(c) to the Class M-2 Certificates of such Certificate Group, the
Accrued Certificate Interest Distribution Amount for such Class on such
Distribution Date;
(d) to the Class B Certificates of such Certificate Group, the
Accrued Certificate Interest Distribution Amount for such Class on such
Distribution Date;
(ii) A. with respect to each Certificate Group on each Distribution
Date (a) before the related Stepdown Date or (b) with respect to which a
Trigger Event is in effect, to the holders of the related Class or Classes of
Offered Certificates then entitled to distributions of principal as set forth
below, an amount equal to the related Principal Distribution Amount in the
following order of priority:
(x) (1) in the case of the Group 1 Certificates, sequentially to the
Class R, Class AF-1, Class AF-2 and Class AF-3 Certificates, in that
order until the respective Class Certificate Balances are reduced to
zero; provided, however, that on any Distribution Date on which the
aggregate Class Certificate Balance of the Class A Certificates for
the Group 1 Certificates are equal to or greater than the aggregate
Stated Principal Balance of the Mortgage Loans in Loan Group 1plus
the amount, if any, in the related Pre-Funding Account, excluding
investment earnings, the Class A Principal Distribution Amount for
the Group 1 Certificates shall be distributed pro rata and not
sequentially;
(2) in the case of the Group 2 Certificates, to the Class AV-1
Certificates until the Class Certificate Balance thereof is reduced
to zero;
(y) for each Certificate Group, sequentially to the related Class
M-1, Class M-2 and Class B Certificates, in that order, until the
respective Class Certificate Balances are reduced to zero;
B on each Distribution Date (a) on and after the related Stepdown
Date and (b) as long as a Trigger Event is not in effect, to the holders of
the related Class or Classes of Offered Certificates then entitled to
distribution of principal an amount equal to, in the aggregate, the related
Principal Distribution Amount in the following amounts and order of priority:
(a) the lesser of (x) the Principal Distribution Amount and (y) the
Class A Principal Distribution Amount, in the following order of
priority:
(1) in the case of the Group 1 Certificates, sequentially to the
Class R, Class AF-1, Class AF-2 and Class AF-3 Certificates, in that
order, until the respective Class Certificate Balances thereof are
reduced to zero; provided, however, that on any Distribution Date on
which the aggregate Class Certificate Balance of the Class A
Certificates for the Group 1 Certificates are equal to or greater
than the aggregate Stated Principal Balance of the Mortgage Loans in
Loan Group 1, the Class A Principal Distribution Amount for the
Group 1 Certificates shall be distributed pro rata and not
sequentially;
(2) in the case of the Group 2 Certificates, to the Class AV-1
Certificates until the Class Certificate Balance thereof is reduced
to zero;
(b) the lesser of (x) the excess of (i) the Principal Distribution
Amount over (ii) the amount distributed to the Class R and Class A
Certificateholders in clause (ii) B. (a) above and (y) the Class M-1
Principal Distribution Amount to the Class M-1 Certificateholders, until
the Class Certificate Balance thereof has been reduced to zero;
(c) the lesser of (x) the excess of (i) the Principal Distribution
Amount over (ii) the amount distributed to the Class A Certificateholders
in clause (ii) B. (a) above and to the Class M-1 Certificates in clause
(ii) B. (b) above and (y) the Class M-2 Principal Distribution Amount to
the Class M-2 Certificateholders, until the Class Certificate Balance
thereof has been reduced to zero;
(d) the lesser of (x) the excess of (i) the Principal Distribution
Amount over (ii) the amount distributed to the Class R and Class A
Certificateholders in clause (ii) B. (a) above, to the Class M-1
Certificates in clause (ii) B. (b) above and to the Class M-2
Certificates in clause (ii) B. (c) above and (y) the Class B Principal
Distribution Amount to the Class B Certificateholders, until the Class
Certificate Balance thereof has been reduced to zero;
(iii) any amount remaining after the distributions in clauses (i)
and (ii) above shall be distributed in the following order of priority with
respect to the Certificates in the related Certificate Group:
(a) to fund the Extra Principal Distribution Amount for such
Distribution Date to be paid as a component of the Principal Distribution
Amount in the same order of priority as described in clause (ii) above;
(b) to the holders of the Class M-1 Certificates, any Unpaid
Interest Amounts for such Class;
(c) to the holders of the Class M-1 Certificates, any Unpaid
Realized Loss Amount for such Class;
(d) to the holders of the Class M-2 Certificates, any Unpaid
Interest Amounts for such Class;
(e) to the holders of the Class M-2 Certificates, any Unpaid
Realized Loss Amount for such Class;
(f) to the holders of the Class B Certificates, any Unpaid Interest
Amounts for such Class;
(g) to the holders of the Class B Certificates, any Unpaid Realized
Loss Amount for such Class;
(h) to the Excess Reserve Fund Account, the amount of any Basis Risk
Payment for such Distribution Date;
(i) from funds on deposit in the Excess Reserve Fund Account, an
amount equal to any Basis Risk CarryForward Amount with respect to any
Adjustable Rate Certificate for such Distribution Date in the following
order: first to the Class AF-1 Certificates then to the Group 2
Certificates in the same order and priority in which Accrued Certificate
Interest is allocated among those Classes of Certificates;
(j) to the extent of any amount remaining and from funds on deposit
in the Interest Reserve Account, if necessary, to the Class BB
Certificates, the Accrued Certificate Interest Distribution Amount and
any Unpaid Interest Amounts;
(k) to the Interest Reserve Account, an amount equal to the Required
Interest Reserve Account Deposit;
(l) to the Class BB Certificates, any amount remaining, together
with any Interest Reserve Release Amount to reduce the Class BB
Certificate Principal Balance, until the Class BB Certificate Principal
Balance has been reduced to zero;
(m) to the holders of the Class X Certificate, the Class X
Distributable Amount, together with any amounts withdrawn from the
Interest Reserve Account for distribution to the Class X Certificates
pursuant to Section 4.04 (d); and
(iv) to the holders of the Class R Certificates, any remaining
amount.
Section 4.03. Monthly Statements to Certificateholders.
(a) Not later than each Distribution Date, the Trustee shall prepare
and cause to be forwarded by first class mail to each Certificateholder, the
Master Servicer and the Depositor a statement setting forth with respect to
the related distribution:
(ii) the amount thereof allocable to principal, separately
identifying the aggregate amount of any Principal Prepayments and
Liquidation Proceeds included therein;
(iii) the amount thereof allocable to interest, any Unpaid Interest
Amounts included in such distribution and any remaining Unpaid Interest
Amounts after giving effect to such distribution, any Basis Risk
CarryForward Amount for such Distribution Date and the amount of all
Basis Risk Carry Forward Amount covered by withdrawals from the Excess
Reserve Fund Account on such Distribution Date;
(iv) if the distribution to the Holders of such Class of
Certificates is less than the full amount that would be distributable to
such Holders if there were sufficient funds available therefor, the
amount of the shortfall and the allocation thereof as between principal
and interest, including any Basis Risk CarryForward Amount not covered by
amounts in the Excess Reserve Fund Account;
(v) the Class Certificate Balance of each Class of Certificates
after giving effect to the distribution of principal on such Distribution
Date;
(vi) the Pool Stated Principal Balance for the following
Distribution Date;
(vii) the amount of the Master Servicing Fees and Servicing Fees
paid to or retained by the Master Servicer or Subservicer (with respect
to the Subservicers, in the aggregate) with respect to such Distribution
Date;
(viii) the Pass-Through Rate for each such Class of Certificates
with respect to such Distribution Date;
(ix) the amount of Advances included in the distribution on such
Distribution Date and the aggregate amount of Advances outstanding as of
the close of business on such Distribution Date;
(x) the number and aggregate principal amounts of Mortgage Loans in
each Loan Group (A) delinquent (exclusive of Mortgage Loans in
foreclosure) (1) 1 to 30 days (2) 31 to 60 days (3) 61 to 90 days and (4)
91 or more days and (B) in foreclosure and delinquent (1) 1 to 30 days
(2) 31 to 60 days (3) 61 to 90 days and (4) 91 or more days, as of the
close of business on the last day of the calendar month preceding such
Distribution Date;
(xi) for each of the preceding 12 calendar months, or all calendar
months since the related Cut-off Date, whichever is less, the aggregate
dollar amount of the Scheduled Payments (A) due on all Outstanding
Mortgage Loans on each of the Due Dates in each such month and (B)
delinquent 60 days or more on each of the Due Dates in each such month;
(xii) with respect to any Mortgage Loan that became an REO Property
during the preceding calendar month, the loan number and Stated Principal
Balance of such Mortgage Loan as of the close of business on the
Determination Date preceding such Distribution Date and the date of
acquisition thereof;
(xiii) the total number and principal balance of any REO Properties
(and market value, if available) as of the close of business on the
Determination Date preceding such Distribution Date;
(xiv) whether a Trigger Event has occurred and is continuing
(including the calculation of thereof and the aggregate outstanding
balance of all 60+ Delinquent Loans)
(xv) whether a Group 2 Step-Up Trigger Event has occurred (including
the calculation thereof)
(xvi) the amount on deposit in the Excess Reserve Fund Account
(after giving effect to distributions on such Distribution Date);
(xvii) the aggregate amount of Realized Losses incurred during the
preceding calendar month and aggregate Realized Losses through such
Distribution Date;
(xviii) the amount of any Net Monthly Excess Cash Flow on such
Distribution Date and the allocation thereof to the Certificateholders
with respect to Applied Realized Losses and Unpaid Interest Amounts;
(xix) with respect to each Loan Group, the Subordinated Amount and
Required Subordinated Amount;
(xx) the Interest Reserve Target Amount for such Distribution Date;
(xxi) the Outstanding Interest Reserve Amount for such Distribution
Date;
(xxii) the Required Interest Reserve Account Deposit for such
Distribution Date; and
(xxiii) the Interest Reserve Release Amount for such Distribution
Date.
(b) The Trustee's responsibility for disbursing the above
information to the Certificateholders is limited to the availability,
timeliness and accuracy of the information derived from the Master Servicer.
The Trustee will send a copy of each statement provided pursuant to this
Section 4.03 to each Rating Agency by first class mail.
(c) Within a reasonable period of time after the end of each
calendar year, the Trustee shall cause to be furnished to each Person who at
any time during the calendar year was a Certificateholder, a statement
containing the information set forth in clauses (a)(i), (a)(ii) and (a)(vii)
of this Section 4.03 aggregated for such calendar year or applicable portion
thereof during which such Person was a Certificateholder. Such obligation of
the Trustee shall be deemed to have been satisfied to the extent that
substantially comparable information shall be provided by the Trustee pursuant
to any requirements of the Code as from time to time in effect.
Section 4.04. Interest Reserve Account
(a) The Trustee shall establish and maintain in its name, in trust
for the benefit of the holders of Class BB Certificates, the Interest Reserve
Account. The Interest Reserve Account shall be an Eligible Account, and funds
on deposit therein shall be held separate and apart from, and shall not be
commingled with, any other moneys, including, without limitation, other moneys
of the Trustee held pursuant to this Agreement.
(b) On each Distribution Date, the Trustee shall make withdrawals
from the Interest Reserve Account to make distributions pursuant to Sections
4.02(iii)(j) and (l).
(c) Funds in the Interest Reserve Account may be invested in
Permitted Investments. Any earnings, net of losses, on such amounts shall be
deposited in the Interest Reserve Account. The Trustee shall account for the
Interest Reserve Account as an outside reserve fund within the meaning of
Treasury regulation 1.860G-2(h) and not an asset of any REMIC created pursuant
to this Agreement. The owner of the Interest Reserve Account is the Class X
Certificateholder. For all Federal tax purposes, amounts transferred by the
Upper Tier REMIC to the Interest Reserve Account shall be treated as
distributions by the Trustee to the Class X Certificateholder. The Class X
Certificateholder shall direct the Trustee in writing with respect to
investment of amounts in the Interest Reserve Account. In the absence of such
written direction, all funds in the Interest Reserve Account shall be invested
by the Trustee in the Bank of New York Cash Reserve Fund.
(d) On the Distribution Date on which the Class BB Certificate
Principal Balance has been reduced to zero, any amounts remaining in the
Interest Reserve Account shall be distributed to the Class X Certificateholder
pursuant to Section 4.02(iii)(m).
Section 4.05. [Reserved]
Section 4.06. [Reserved]
Section 4.07. Certain Matters Relating to the Determination of
LIBOR.
Until all of the LIBOR Certificates are paid in full, the Trustee
will at all times retain at least four Reference Banks for the purpose of
determining LIBOR with respect to each Interest Determination Date. The Master
Servicer initially shall designate the Reference Banks. Each "Reference Bank"
shall be a leading bank engaged in transactions in Eurodollar deposits in the
international Eurocurrency market, shall not control, be controlled by, or be
under common control with, the Trustee and shall have an established place of
business in London. If any such Reference Bank should be unwilling or unable
to act as such or if the Master Servicer should terminate its appointment as
Reference Bank, the Master Servicer shall promptly appoint or cause to be
appointed another Reference Bank. The Trustee shall have no liability or
responsibility to any Person for (i) the selection of any Reference Bank for
purposes of determining LIBOR or (ii) any inability to retain at least four
Reference Banks which is caused by circumstances beyond its reasonable
control.
The Pass-Through Rate for each Class of LIBOR Certificates for each
Interest Accrual Period shall be determined by the Trustee on each LIBOR
Determination Date so long as the LIBOR Certificates are outstanding on the
basis of LIBOR and the respective formulae appearing in footnotes
corresponding to the LIBOR Certificates in the table relating to the
Certificates in the Preliminary Statement. The Trustee shall not have any
liability or responsibility to any Person for its inability, following a
good-faith reasonable effort, to obtain quotations from the Reference Banks or
to determine the arithmetic mean referred to in the definition of LIBOR, all
as provided for in this Section 4.07 and the definition of LIBOR. The
establishment of LIBOR and each Pass-Through Rate for the LIBOR Certificates
by the Trustee shall (in the absence of manifest error) be final, conclusive
and binding upon each Holder of a Certificate and the Trustee.
<PAGE>
ARTICLE V
THE CERTIFICATES
Section 5.01. The Certificates.
The Certificates shall be substantially in the forms attached hereto
as exhibits. The Certificates shall be issuable in registered form, in the
minimum denominations, integral multiples in excess thereof (except that one
Certificate in each Class may be issued in a different amount which must be in
excess of the applicable minimum denomination) and aggregate denominations per
Class set forth in the Preliminary Statement.
Subject to Section 9.02 respecting the final distribution on the
Certificates, on each Distribution Date the Trustee shall make distributions
to each Certificateholder of record on the preceding Record Date either (x) by
wire transfer in immediately available funds to the account of such holder at
a bank or other entity having appropriate facilities therefor, if (i) such
Holder has so notified the Trustee at least five Business Days prior to the
related Record Date and (ii) such Holder shall hold (A) 100% of the Class
Certificate Balance of any Class of Certificates or (B) Certificates of any
Class with aggregate principal Denominations of not less than $1,000,000 or
(y) by check mailed by first class mail to such Certificateholder at the
address of such holder appearing in the Certificate Register.
The Certificates shall be executed by manual or facsimile signature
on behalf of the Trustee by an authorized officer. Certificates bearing the
manual or facsimile signatures of individuals who were, at the time such
signatures were affixed, authorized to sign on behalf of the Trustee shall
bind the Trustee, notwithstanding that such individuals or any of them have
ceased to be so authorized prior to the countersignature and delivery of any
such Certificates or did not hold such offices at the date of such
Certificate. No Certificate shall be entitled to any benefit under this
Agreement, or be valid for any purpose, unless countersigned by the Trustee by
manual signature, and such countersignature upon any Certificate shall be
conclusive evidence, and the only evidence, that such Certificate has been
duly executed and delivered hereunder. All Certificates shall be dated the
date of their countersignature. On the Closing Date, the Trustee shall
countersign the Certificates to be issued at the direction of the Depositor,
or any affiliate thereof.
The Depositor shall provide, or cause to be provided, to the Trustee
on a continuous basis, an adequate inventory of Certificates to facilitate
transfers.
Section 5.02. Certificate Register; Registration of Transfer and
Exchange of Certificates.
(a) The Trustee shall maintain, or cause to be maintained in
accordance with the provisions of Section 5.06, a Certificate Register for the
Trust Fund in which, subject to the provisions of subsections (b) and (c)
below and to such reasonable regulations as it may prescribe, the Trustee
shall provide for the registration of Certificates and of transfers and
exchanges of Certificates as herein provided. Upon surrender for registration
of transfer of any Certificate, the Trustee shall execute and deliver, in the
name of the designated transferee or transferees, one or more new Certificates
of the same Class and aggregate Percentage Interest.
At the option of a Certificateholder, Certificates may be exchanged
for other Certificates of the same Class in authorized denominations and
evidencing the same aggregate Percentage Interest upon surrender of the
Certificates to be exchanged at the office or agency of the Trustee. Whenever
any Certificates are so surrendered for exchange, the Trustee shall execute,
authenticate, and deliver the Certificates which the Certificateholder making
the exchange is entitled to receive. Every Certificate presented or
surrendered for registration of transfer or exchange shall be accompanied by a
written instrument of transfer in form satisfactory to the Trustee duly
executed by the holder thereof or his attorney duly authorized in writing.
No service charge to the Certificateholders shall be made for any
registration of transfer or exchange of Certificates, but payment of a sum
sufficient to cover any tax or governmental charge that may be imposed in
connection with any transfer or exchange of Certificates may be required.
All Certificates surrendered for registration of transfer or
exchange shall be cancelled and subsequently destroyed by the Trustee in
accordance with the Trustee's customary procedures.
(b) No transfer of a Private Certificate shall be made unless such
transfer is made pursuant to an effective registration statement under the
Securities Act and any applicable state securities laws or is exempt from the
registration requirements under said Act and such state securities laws. In
the event that a transfer is to be made in reliance upon an exemption from the
Securities Act and such laws, in order to assure compliance with the
Securities Act and such laws, the Certificateholder desiring to effect such
transfer shall certify to the Trustee in writing the facts surrounding the
transfer in substantially the form set forth in Exhibit J (the "Transferor
Certificate") and either (i) there shall be delivered to the Trustee a letter
in substantially the form of Exhibit L (the "Rule 144A Letter") or (ii) there
shall be delivered to the Trustee at the expense of the transferor an Opinion
of Counsel that such transfer may be made without registration under the
Securities Act. The Depositor shall provide to any Holder of a Private
Certificate and any prospective transferee designated by any such Holder,
information regarding the related Certificates and the Mortgage Loans and such
other information as shall be necessary to satisfy the condition to
eligibility set forth in Rule 144A(d)(4) for transfer of any such Certificate
without registration thereof under the Securities Act pursuant to the
registration exemption provided by Rule 144A. The Trustee and the Master
Servicer shall cooperate with the Depositor in providing the Rule 144A
information referenced in the preceding sentence, including providing to the
Depositor such information regarding the Certificates, the Mortgage Loans and
other matters regarding the Trust Fund as the Depositor shall reasonably
request to meet its obligation under the preceding sentence. Each Holder of a
Private Certificate desiring to effect such transfer shall, and does hereby
agree to, indemnify the Trustee and the Depositor, the Seller and the Master
Servicer against any liability that may result if the transfer is not so
exempt or is not made in accordance with such federal and state laws.
No transfer of an ERISA-Restricted Certificate shall be made unless
the Trustee shall have received either (i) a representation from the
transferee of such Certificate acceptable to and in form and substance
satisfactory to the Trustee (in the event such Certificate is a Private
Certificate or a Residual Certificate, such requirement is satisfied only by
the Trustee's receipt of a representation letter from the transferee
substantially in the form of Exhibit L), 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) if the ERISA-Restricted
Certificate is a Private Certificate that has been the subject of an
ERISA-Qualifying Underwriting, a Subordinated Certificate or a Residual
Certificate, if the purchaser is an insurance company, a representation that
the purchaser is an insurance company that is purchasing such Certificates
with funds contained in an "insurance company general account" (as such term
is defined in Section V(e) of Prohibited Transaction Class Exemption 95-60
("PTCE 95-60") and that the purchase and holding of such Certificates are
covered under Sections I and III of PTCE 95-60 or (iii) in the case of any
such ERISA-Restricted Certificate 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 and the Master
Servicer, which Opinion of Counsel shall not be an expense of the Trustee, the
Master Servicer or the Trust Fund, addressed to the Trustee, to the effect
that the purchase or holding of such ERISA-Restricted Certificate will not
result in the assets of the Trust Fund being deemed to be "plan assets" and
subject to the prohibited transaction provisions of ERISA and the Code and
will not subject the Trustee or the Master Servicer to any obligation in
addition to those expressly undertaken in this Agreement or to any liability.
For purposes of the preceding sentence, with respect to an ERISA-Restricted
Certificate that is not a Private Certificate or a Residual Certificate, in
the event the representation letter referred to in the preceding sentence is
not furnished, such representation shall be deemed to have been made to the
Trustee by the transferee's (including an initial acquiror's) acceptance of
the ERISA-Restricted Certificates. In the event that such representation is
violated, or any attempt to transfer to a plan or arrangement subject to
Section 406 of ERISA or a plan subject to Section 4975 of the Code, or a
person acting on behalf of any such plan or arrangement or using the assets of
any such plan or arrangement, without such Opinion of Counsel, such attempted
transfer or acquisition shall be void and of no effect.
To the extent permitted under applicable law (including, but not
limited to, ERISA), the Trustee shall be under no liability to any Person for
any registration of transfer of any ERISA-Restricted Certificate that is in
fact not permitted by this Section 5.02(b) or for making any payments due on
such Certificate to the Holder thereof or taking any other action with respect
to such Holder under the provisions of this Agreement so long as the transfer
was registered by the Trustee in accordance with the foregoing requirements.
(c) Each Person who has or who acquires any Ownership Interest in a
Residual Certificate shall be deemed by the acceptance or acquisition of such
Ownership Interest to have agreed to be bound by the following provisions, and
the rights of each Person acquiring any Ownership Interest in a Residual
Certificate are expressly subject to the following provisions:
(ii) Each Person holding or acquiring any Ownership Interest in
a Residual Certificate shall be a Permitted Transferee and shall
promptly notify the Trustee of any change or impending change in its
status as a Permitted Transferee.
(iii) No Ownership Interest in a Residual Certificate may be
registered on the Closing Date or thereafter transferred, and the
Trustee shall not register the Transfer of any Residual Certificate
unless, in addition to the certificates required to be delivered to
the Trustee under subparagraph (b) above, the Trustee shall have
been furnished with an affidavit (a "Transfer Affidavit") of the
initial owner or the proposed transferee in the form attached hereto
as Exhibit I.
(iv) Each Person holding or acquiring any Ownership Interest in
a Residual Certificate shall agree (A) to obtain a Transfer
Affidavit from any other Person to whom such Person attempts to
Transfer its Ownership Interest in a Residual Certificate, (B) to
obtain a Transfer Affidavit from any Person for whom such Person is
acting as nominee, trustee or agent in connection with any Transfer
of a Residual Certificate and (C) not to Transfer its Ownership
Interest in a Residual Certificate or to cause the Transfer of an
Ownership Interest in a Residual Certificate to any other Person if
it has actual knowledge that such Person is not a Permitted
Transferee.
(v) Any attempted or purported Transfer of any Ownership
Interest in a Residual Certificate in violation of the provisions of
this Section 5.02(c) shall be absolutely null and void and shall
vest no rights in the purported Transferee. If any purported
transferee shall become a Holder of a Residual Certificate in
violation of the provisions of this Section 5.02(c), then the last
preceding Permitted Transferee shall be restored to all rights as
Holder thereof retroactive to the date of registration of Transfer
of such Residual Certificate. The Trustee shall be under no
liability to any Person for any registration of Transfer of a
Residual Certificate that is in fact not permitted by Section
5.02(b) and this Section 5.02(c) or for making any payments due on
such Certificate to the Holder thereof or taking any other action
with respect to such Holder under the provisions of this Agreement
so long as the Transfer was registered after receipt of the related
Transfer Affidavit, Transferor Certificate and either the Rule 144A
Letter or the Investment Letter. The Trustee shall be entitled but
not obligated to recover from any Holder of a Residual Certificate
that was in fact not a Permitted Transferee at the time it became a
Holder or, at such subsequent time as it became other than a
Permitted Transferee, all payments made on such Residual Certificate
at and after either such time. Any such payments so recovered by the
Trustee shall be paid and delivered by the Trustee to the last
preceding Permitted Transferee of such Certificate.
(vi) The Depositor shall use its best efforts to make available,
upon receipt of written request from the Trustee, all information
necessary to compute any tax imposed under Section 860E(e) of the
Code as a result of a Transfer of an Ownership Interest in a
Residual Certificate to any Holder who is not a Permitted
Transferee.
The restrictions on Transfers of a Residual Certificate set forth in
this Section 5.02(c) shall cease to apply (and the applicable portions of the
legend on a Residual Certificate may be deleted) with respect to Transfers
occurring after delivery to the Trustee of an Opinion of Counsel, which
Opinion of Counsel shall not be an expense of the Trust Fund, the Trustee, the
Seller or the Master Servicer, to the effect that the elimination of such
restrictions will not cause the Trust Fund hereunder to fail to qualify as a
REMIC at any time that the Certificates are outstanding or result in the
imposition of any tax on the Trust Fund, a Certificateholder or another
Person. Each Person holding or acquiring any Ownership Interest in a Residual
Certificate hereby consents to any amendment of this Agreement which, based on
an Opinion of Counsel furnished to the Trustee, is reasonably necessary (a) to
ensure that the record ownership of, or any beneficial interest in, a Residual
Certificate is not transferred, directly or indirectly, to a Person that is
not a Permitted Transferee and (b) to provide for a means to compel the
Transfer of a Residual Certificate which is held by a Person that is not a
Permitted Transferee to a Holder that is a Permitted Transferee.
(d) The preparation and delivery of all certificates and opinions
referred to above in this Section 5.02 in connection with transfer shall be at
the expense of the parties to such transfers.
(e) Except as provided below, the Book-Entry Certificates shall at
all times remain registered in the name of the Depository or its nominee and
at all times: (i) registration of the Certificates may not be transferred by
the Trustee except to another Depository; (ii) the Depository shall maintain
book-entry records with respect to the Certificate Owners and with respect to
ownership and transfers of such Book-Entry Certificates; (iii) ownership and
transfers of registration of the Book-Entry Certificates on the books of the
Depository shall be governed by applicable rules established by the
Depository; (iv) the Depository may collect its usual and customary fees,
charges and expenses from its Depository Participants; (v) the Trustee shall
deal with the Depository, Depository Participants and indirect participating
firms as representatives of the Certificate Owners of the Book-Entry
Certificates for purposes of exercising the rights of holders under this
Agreement, and requests and directions for and votes of such representatives
shall not be deemed to be inconsistent if they are made with respect to
different Certificate Owners; and (vi) the Trustee may rely and shall be fully
protected in relying upon information furnished by the Depository with respect
to its Depository Participants and furnished by the Depository Participants
with respect to indirect participating firms and persons shown on the books of
such indirect participating firms as direct or indirect Certificate Owners.
All transfers by Certificate Owners of Book-Entry Certificates shall
be made in accordance with the procedures established by the Depository
Participant or brokerage firm representing such Certificate Owner. Each
Depository Participant shall only transfer Book-Entry Certificates of
Certificate Owners it represents or of brokerage firms for which it acts as
agent in accordance with the Depository's normal procedures.
If (x) (i) the Depository or the Depositor advises the Trustee in
writing that the Depository is no longer willing or able to properly discharge
its responsibilities as Depository, and (ii) the Trustee or the Depositor is
unable to locate a qualified successor, (y) the Depositor at its option
advises the Trustee in writing that it elects to terminate the book-entry
system through the Depository or (z) after the occurrence of an Event of
Default, Certificate Owners representing at least 51% of the Certificate
Balance of the Book-Entry Certificates together advise the Trustee and the
Depository through the Depository Participants in writing that the
continuation of a book-entry system through the Depository is no longer in the
best interests of the Certificate Owners, the Trustee shall notify all
Certificate Owners, through the Depository, of the occurrence of any such
event and of the availability of definitive, fully-registered Certificates
(the "Definitive Certificates") to Certificate Owners requesting the same.
Upon surrender to the Trustee of the related Class of Certificates by the
Depository, accompanied by the instructions from the Depository for
registration, the Trustee shall issue the Definitive Certificates. Neither the
Master Servicer, the Depositor nor the Trustee shall be liable for any delay
in delivery of such instruction and each may conclusively rely on, and shall
be protected in relying on, such instructions. The Master Servicer shall
provide the Trustee with an adequate inventory of certificates to facilitate
the issuance and transfer of Definitive Certificates. Upon the issuance of
Definitive Certificates all references herein to obligations imposed upon or
to be performed by the Depository shall be deemed to be imposed upon and
performed by the Trustee, to the extent applicable with respect to such
Definitive Certificates and the Trustee shall recognize the Holders of the
Definitive Certificates as Certificateholders hereunder; provided that the
Trustee shall not by virtue of its assumption of such obligations become
liable to any party for any act or failure to act of the Depository.
(f) For so long as the BB Certificate is outstanding, the Class X
Certificate shall be registered in the name of a bankruptcy-remote entity, and
any proposed Transferee shall represent to the Trustee that it is a
bankruptcy-remote entity.
Section 5.03. Mutilated, Destroyed, Lost or Stolen Certificates.
If (a) any mutilated Certificate is surrendered to the Trustee, or
the Trustee receives evidence to its satisfaction of the destruction, loss or
theft of any Certificate and (b) there is delivered to the Master Servicer and
the Trustee such security or indemnity as may be required by them to hold each
of them harmless, then, in the absence of notice to the Trustee that such
Certificate has been acquired by a bona fide purchaser, the Trustee shall
execute, countersign and deliver, in exchange for or in lieu of any such
mutilated, destroyed, lost or stolen Certificate, a new Certificate of like
Class, tenor and Percentage Interest. In connection with the issuance of any
new Certificate under this Section 5.03, the Trustee may require the payment
of a sum sufficient to cover any tax or other governmental charge that may be
imposed in relation thereto and any other expenses (including the fees and
expenses of the Trustee) connected therewith. Any replacement Certificate
issued pursuant to this Section 5.03 shall constitute complete and
indefeasible evidence of ownership, as if originally issued, whether or not
the lost, stolen or destroyed Certificate shall be found at any time.
Section 5.04. Persons Deemed Owners.
The Master Servicer, the Trustee and any agent of the Master
Servicer or the Trustee may treat the Person in whose name any Certificate is
registered as the owner of such Certificate for the purpose of receiving
distributions as provided in this Agreement and for all other purposes
whatsoever, and neither the Master Servicer, the Trustee nor any agent of the
Master Servicer or the Trustee shall be affected by any notice to the
contrary.
Section 5.05. Access to List of Certificateholders' Names and
Addresses.
If three or more Certificateholders (a) request such information in
writing from the Trustee, (b) state that such Certificateholders desire to
communicate with other Certificateholders with respect to their rights under
this Agreement or under the Certificates, and (c) provide a copy of the
communication which such Certificateholders propose to transmit, or if the
Depositor or Master Servicer shall request such information in writing from
the Trustee, then the Trustee shall, within ten Business Days after the
receipt of such request, provide the Depositor, the Master Servicer or such
Certificateholders at such recipients' expense the most recent list of the
Certificateholders of such Trust Fund held by the Trustee, if any. The
Depositor and every Certificateholder, by receiving and holding a Certificate,
agree that the Trustee shall not be held accountable by reason of the
disclosure of any such information as to the list of the Certificateholders
hereunder, regardless of the source from which such information was derived.
Section 5.06. Maintenance of Office or Agency.
The Trustee will maintain or cause to be maintained at its expense
an office or offices or agency or agencies in New York City where Certificates
may be surrendered for registration of transfer or exchange. The Trustee
initially designates its Corporate Trust Office for such purposes. The Trustee
will give prompt written notice to the Certificateholders of any change in
such location of any such office or agency.
<PAGE>
ARTICLE VI
THE DEPOSITOR AND THE MASTER SERVICER
Section 6.01. Respective Liabilities of the Depositor and the Master
Servicer.
The Depositor and the Master Servicer shall each be liable in
accordance herewith only to the extent of the obligations specifically and
respectively imposed upon and undertaken by them herein.
Section 6.02. Merger or Consolidation of the Depositor or the Master
Servicer.
The Depositor and the Master Servicer will each keep in full effect
its existence, rights and franchises as a corporation under the laws of the
United States or under the laws of one of the states thereof and will each
obtain and preserve its qualification to do business as a foreign corporation
in each jurisdiction in which such qualification is or shall be necessary to
protect the validity and enforceability of this Agreement, or any of the
Mortgage Loans and to perform its respective duties under this Agreement.
Any Person into which the Depositor or the Master Servicer may be
merged or consolidated, or any Person resulting from any merger or
consolidation to which the Depositor or the Master Servicer shall be a party,
or any person succeeding to the business of the Depositor or the Master
Servicer, shall be the successor of the Depositor or the Master Servicer, as
the case may be, hereunder, without the execution or filing of any paper or
any further act on the part of any of the parties hereto, anything herein to
the contrary notwithstanding; provided, however, that the successor or
surviving Person to the Master Servicer shall be qualified to sell mortgage
loans to, and to service mortgage loans on behalf of, FNMA or FHLMC.
Section 6.03. Limitation on Liability of the Depositor, the Seller,
the Master Servicer and Others.
None of the Depositor, the Seller, the Master Servicer or any of the
directors, officers, employees or agents of the Depositor, the Seller or the
Master Servicer shall be under any liability to the Certificateholders for any
action taken or for refraining from the taking of any action in good faith
pursuant to this Agreement, or for errors in judgment; provided, however, that
this provision shall not protect the Depositor, the Seller, the Master
Servicer or any such Person against any breach of representations or
warranties made by it herein or protect the Depositor, the Seller, the Master
Servicer or any such Person from any liability which would otherwise be
imposed by reasons of willful misfeasance, bad faith or gross negligence in
the performance of duties or by reason of reckless disregard of obligations
and duties hereunder. The Depositor, the Seller, the Master Servicer and any
director, officer, employee or agent of the Depositor, the Seller or the
Master Servicer may rely in good faith on any document of any kind prima facie
properly executed and submitted by any Person respecting any matters arising
hereunder. The Depositor, the Seller, the Master Servicer and any director,
officer, employee or agent of the Depositor, the Seller or the Master Servicer
shall be indemnified by the Trust Fund and held harmless against any loss,
liability or expense incurred in connection with any audit, controversy or
judicial proceeding relating to a governmental taxing authority or any legal
action relating to this Agreement or the Certificates, other than any loss,
liability or expense related to any specific Mortgage Loan or Mortgage Loans
(except as any such loss, liability or expense shall be otherwise reimbursable
pursuant to this Agreement) and any loss, liability or expense incurred by
reason of willful misfeasance, bad faith or gross negligence in the
performance of duties hereunder or by reason of reckless disregard of
obligations and duties hereunder. None of the Depositor, the Seller or the
Master Servicer shall be under any obligation to appear in, prosecute or
defend any legal action that is not incidental to its respective duties
hereunder and which in its opinion may involve it in any expense or liability;
provided, however, that any of the Depositor, the Seller or the Master
Servicer may in its discretion undertake any such action that it may deem
necessary or desirable in respect of this Agreement and the rights and duties
of the parties hereto and interests of the Trustee and the Certificateholders
hereunder. In such event, the legal expenses and costs of such action and any
liability resulting therefrom shall be expenses, costs and liabilities of the
Trust Fund, and the Depositor, the Seller and the Master Servicer shall be
entitled to be reimbursed therefor out of the Certificate Account.
Section 6.04. Limitation on Resignation of the Master Servicer.
The Master Servicer shall not resign from the obligations and duties
hereby imposed on it except (a) upon appointment of a successor servicer and
receipt by the Trustee of a letter from each Rating Agency that such a
resignation and appointment will not result in a downgrading of the rating of
any of the Certificates or (b) upon determination that its duties hereunder
are no longer permissible under applicable law. Any such determination under
clause (b) permitting the resignation of the Master Servicer shall be
evidenced by an Opinion of Counsel to such effect delivered to the Trustee. No
such resignation shall become effective until the Trustee or a successor
master servicer shall have assumed the Master Servicer's responsibilities,
duties, liabilities and obligations hereunder.
<PAGE>
ARTICLE VII
DEFAULT
Section 7.01. Events of Default.
"Event of Default," wherever used herein, means any one of the
following events:
(a) any failure by the Master Servicer to deposit in the Certificate
Account or remit to the Trustee any payment (other than a payment required to
be made under Section 4.01) required to be made by it under the terms of this
Agreement, which failure shall continue unremedied for five days after the
date upon which written notice of such failure shall have been given to the
Master Servicer by the Trustee or the Depositor or to the Master Servicer and
the Trustee by the Holders of Certificates of any Class evidencing not less
than 25% of the aggregate Percentage Interests of such Class; or
(b) any failure by the Master Servicer to observe or perform in any
material respect any other of the covenants or agreements on the part of the
Master Servicer contained in this Agreement, which failure materially affects
the rights of Certificateholders and continues unremedied for a period of 60
days after the date on which written notice of such failure shall have been
given to the Master Servicer by the Trustee or the Depositor, or to the Master
Servicer and the Trustee by the Holders of Certificates of any Class
evidencing not less than 25% of the Percentage Interests of such Class; or
(c) a decree or order of a court or agency or supervisory authority
having jurisdiction in the premises for the appointment of a receiver or
liquidator in any insolvency, readjustment of debt, marshalling of assets and
liabilities or similar proceedings, or for the winding-up or liquidation of
its affairs, shall have been entered against the Master Servicer and such
decree or order shall have remained in force undischarged or unstayed for a
period of 60 consecutive days; or
(d) the Master Servicer shall consent to the appointment of a
receiver or liquidator in any insolvency, readjustment of debt, marshalling of
assets and liabilities or similar proceedings of or relating to the Master
Servicer or all or substantially all of the property of the Master Servicer;
or
(e) the Master Servicer shall admit in writing its inability to pay
its debts generally as they become due, file a petition to take advantage of,
or commence a voluntary case under, any applicable insolvency or
reorganization statute, make an assignment for the benefit of its creditors,
or voluntarily suspend payment of its obligations.
If an Event of Default described in clauses (a) through (e) of this
Section 7.01 shall occur, then, and in each and every such case, so long as
such Event of Default shall not have been remedied, the Trustee may, or at the
direction of the Holders of Certificates of any Class evidencing not less than
662/3% of the Percentage Interests of such Class, the Trustee shall by notice
in writing to the Master Servicer (with a copy to each Rating Agency),
terminate all of the rights and obligations of the Master Servicer under this
Agreement and in and to the Mortgage Loans and the proceeds thereof, other
than its rights as a Certificateholder hereunder. On and after the receipt by
the Master Servicer of such written notice, all authority and power of the
Master Servicer hereunder, whether with respect to the Mortgage Loans or
otherwise, shall pass to and be vested in the Trustee. The Trustee shall make
any Advance which the Master Servicer failed to make subject to Section 3.03,
whether or not the obligations of the Master Servicer have been terminated
pursuant to this Section. The Trustee is hereby authorized and empowered to
execute and deliver, on behalf of the Master Servicer, as attorney-in-fact or
otherwise, any and all documents and other instruments, and to do or
accomplish all other acts or things necessary or appropriate to effect the
purposes of such notice of termination, whether to complete the transfer and
endorsement or assignment of the Mortgage Loans and related documents, or
otherwise. Unless expressly provided in such written notice, no such
termination shall affect any obligation of the Master Servicer to pay amounts
owed pursuant to Article VIII. The Master Servicer agrees to cooperate with
the Trustee in effecting the termination of the Master Servicer's
responsibilities and rights hereunder, including, without limitation, the
transfer to the Trustee of all cash amounts which shall at the time be
credited to the Certificate Account, or thereafter be received with respect to
the Mortgage Loans.
Notwithstanding any termination of the activities of the Master
Servicer hereunder, the Master Servicer shall be entitled to receive, out of
any late collection of a Scheduled Payment on a Mortgage Loan which was due
prior to the notice terminating such Master Servicer's rights and obligations
as Master Servicer hereunder and received after such notice, that portion
thereof to which such Master Servicer would have been entitled pursuant to
Sections 3.11(a)(i) through (viii), and any other amounts payable to such
Master Servicer hereunder the entitlement to which arose prior to the
termination of its activities hereunder.
Section 7.02. Trustee to Act; Appointment of Successor.
On and after the time the Master Servicer receives a notice of
termination pursuant to Section 7.01, the Trustee shall, subject to and to the
extent provided in Section 3.05, be the successor to the Master Servicer in
its capacity as master 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 Master Servicer by the
terms and provisions hereof and applicable law including the obligation to
make Advances pursuant to Section 4.01. As compensation therefor, the Trustee
shall be entitled to all funds relating to the Mortgage Loans that the Master
Servicer would have been entitled to charge to the Certificate Account or
Distribution Account if the Master Servicer had continued to act hereunder
including, if the Master Servicer was receiving the Servicing Fee, the
Servicing Fee. Notwithstanding the foregoing, if the Trustee has become the
successor to the Master Servicer in accordance with Section 7.01, the Trustee
may, if it shall be unwilling to so act, or shall, if it is prohibited by
applicable law from making Advances pursuant to Section 4.01 or if it is
otherwise unable to so act, appoint, or petition a court of competent
jurisdiction to appoint, any established mortgage loan servicing institution
the appointment of which does not adversely affect the then current rating of
the Certificates by each Rating Agency, as the successor to the Master
Servicer hereunder in the assumption of all or any part of the
responsibilities, duties or liabilities of the Master Servicer hereunder. Any
successor to the Master Servicer shall be an institution which is a FNMA and
FHLMC approved seller/servicer in good standing, which has a net worth of at
least $15,000,000, which is willing to service the Mortgage Loans and which
executes and delivers to the Depositor and the Trustee an agreement accepting
such delegation and assignment, containing an assumption by such Person of the
rights, powers, duties, responsibilities, obligations and liabilities of the
Master Servicer (other than liabilities of the Master Servicer under Section
6.03 incurred prior to termination of the Master Servicer under Section 7.01),
with like effect as if originally named as a party to this Agreement; provided
that each Rating Agency acknowledges that its rating of the Certificates in
effect immediately prior to such assignment and delegation will not be
qualified or reduced, as a result of such assignment and delegation. Pending
appointment of a successor to the Master Servicer hereunder, the Trustee,
unless the Trustee is prohibited by law from so acting, shall, subject to
Section 3.05, act in such capacity as hereinabove provided. In connection with
such appointment and assumption, the Trustee may make such arrangements for
the compensation of such successor out of payments on Mortgage Loans as it and
such successor shall agree; provided, however, that no such compensation shall
be in excess of the Master Servicing Fee Rate plus, if the Master Servicer was
receiving the Servicing Fee, the Servicing Fee Rate. The Trustee and such
successor shall take such action, consistent with this Agreement, as shall be
necessary to effectuate any such succession. Neither the Trustee nor any other
successor master servicer shall be deemed to be in default hereunder by reason
of any failure to make, or any delay in making, any distribution hereunder or
any portion thereof or any failure to perform, or any delay in performing, any
duties or responsibilities hereunder, in either case caused by the failure of
the Master Servicer to deliver or provide, or any delay in delivering or
providing, any cash, information, documents or records to it.
Any successor to the Master Servicer as master servicer shall give
notice to the Mortgagors of such change of servicer and shall, during the term
of its service as master servicer, maintain in force the policy or policies
that the Master Servicer is required to maintain pursuant to Section 6.05.
Section 7.03. Notification to Certificateholders.
(a) Upon any termination of or appointment of a successor to the
Master Servicer, the Trustee shall give prompt written notice thereof to
Certificateholders and to each Rating Agency.
(b) Within 60 days after the occurrence of any Event of Default, the
Trustee shall transmit by mail to all Certificateholders and each Rating
Agency notice of each such Event of Default hereunder known to the Trustee,
unless such Event of Default shall have been cured or waived.
<PAGE>
ARTICLE VIII
CONCERNING THE TRUSTEE
Section 8.01. Duties of the Trustee.
The Trustee, prior to the occurrence of an Event of Default and
after the curing of all Events of Default that may have occurred, shall
undertake to perform such duties and only such duties as are specifically set
forth in this Agreement. In case an Event of Default has occurred and remains
uncured, the Trustee shall exercise such of the rights and powers vested in it
by this Agreement, and use the same degree of care and skill in their exercise
as a prudent person would exercise or use under the circumstances in the
conduct of such person's own affairs.
The Trustee, upon receipt of all resolutions, certificates,
statements, opinions, reports, documents, orders or other instruments
furnished to the Trustee that are specifically required to be furnished
pursuant to any provision of this Agreement shall examine them to determine
whether they are in the form required by this Agreement; provided, however,
that the Trustee shall not be responsible for the accuracy or content of any
such resolution, certificate, statement, opinion, report, document, order or
other instrument.
No provision of this Agreement shall be construed to relieve the
Trustee from liability for its own negligent action, its own negligent failure
to act or its own willful misconduct; provided, however, that:
(a) unless an Event of Default known to the Trustee shall have
occurred and be continuing, the duties and obligations of the Trustee shall be
determined solely by the express provisions of this Agreement, the Trustee
shall not be liable except for the performance of 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 the
Trustee may conclusively rely, as to the truth of the statements and the
correctness of the opinions expressed therein, upon any certificates or
opinions furnished to the Trustee and conforming to the requirements of this
Agreement which it believed in good faith to be genuine and to have been duly
executed by the proper authorities respecting any matters arising hereunder;
(b) the Trustee shall not be liable for an error of judgment made in
good faith by a Responsible Officer or Responsible Officers of the Trustee,
unless it shall be finally proven that the Trustee was negligent in
ascertaining the pertinent facts; and
(c) the Trustee shall not be liable with respect to any action
taken, suffered or omitted to be taken by it in good faith in accordance with
the direction of Holders of Certificates evidencing not less than 25% of the
Voting Rights of Certificates relating to the time, method and place of
conducting any proceeding for any remedy available to the Trustee, or
exercising any trust or power conferred upon the Trustee under this Agreement.
Section 8.02. Certain Matters Affecting the Trustee.
Except as otherwise provided in Section 8.01:
(a) the Trustee may request and rely upon and shall be protected in
acting or refraining from acting upon any resolution, Officer's Certificate,
certificate of auditors or any other certificate, statement, instrument,
opinion, report, notice, request, consent, order, appraisal, bond or other
paper or document believed by it to be genuine and to have been signed or
presented by the proper party or parties and the Trustee shall have no
responsibility to ascertain or confirm the genuineness of any signature of any
such party or parties;
(b) the Trustee may consult with counsel, financial advisers or
accountants and the advice of any such counsel, financial advisers or
accountants and any Opinion of Counsel shall be full and complete
authorization and protection in respect of any action taken or suffered or
omitted by it hereunder in good faith and in accordance with such Opinion of
Counsel;
(c) the Trustee shall not be liable for any action taken, suffered
or omitted by it in good faith and believed by it to be authorized or within
the discretion or rights or powers conferred upon it by this Agreement;
(d) the Trustee shall not be bound to make any investigation into
the facts or matters stated in any resolution, certificate, statement,
instrument, opinion, report, notice, request, consent, order, approval, bond
or other paper or document, unless requested in writing so to do by Holders of
Certificates evidencing not less than 25% of the Voting Rights allocated to
each Class of Certificates;
(e) the Trustee may execute any of the trusts or powers hereunder or
perform any duties hereunder either directly or by or through agents,
accountants or attorneys and the Trustee shall not be responsible for any
misconduct or negligence on the part of any agents, accountants or attorneys
appointed with due care by it hereunder;
(f) the Trustee shall not be required to risk or expend its own
funds or otherwise incur any financial liability in the performance of any of
its duties or in the exercise of any of its rights or powers hereunder if it
shall have reasonable grounds for believing that repayment of such funds or
adequate indemnity against such risk or liability is not assured to it;
(g) the Trustee shall not be liable for any loss on any investment
of funds pursuant to this Agreement (other than as issuer of the investment
security);
(h) the Trustee shall not be deemed to have knowledge of an Event of
Default until a Responsible Officer of the Trustee shall have received written
notice thereof; and
(i) the Trustee shall be under no obligation to exercise any of the
trusts, rights or powers vested in it by this Agreement or to institute,
conduct or defend any litigation hereunder or in relation hereto at the
request, order or direction of any of the Certificateholders, pursuant to the
provisions of this Agreement, unless such Certificateholders shall have
offered to the Trustee reasonable security or indemnity satisfactory to the
Trustee against the costs, expenses and liabilities which may be incurred
therein or thereby.
Section 8.03. Trustee Not Liable for Certificates or Mortgage Loans.
The recitals contained herein and in the Certificates shall be taken
as the statements of the Depositor or the Seller, as the case may be, and the
Trustee assumes no responsibility for their correctness. The Trustee makes no
representations as to the validity or sufficiency of this Agreement or of the
Certificates or of any Mortgage Loan or related document other than with
respect to the Trustee's execution and countersignature of the Certificates.
The Trustee shall not be accountable for the use or application by the
Depositor or the Master Servicer of any funds paid to the Depositor or the
Master Servicer in respect of the Mortgage Loans or deposited in or withdrawn
from the Certificate Account by the Depositor or the Master Servicer.
Except as provided in Section 2.01(c), the Trustee shall have no
responsibility for filing or recording any financing or continuation statement
in any public office at any time or to otherwise perfect or maintain the
perfection of any security interest or lien granted to it hereunder (unless
the Trustee shall have become the successor Master Servicer).
The Certificates are executed by the Trustee, not in its individual
capacity but solely as Trustee of the Trust Fund created by this Agreement, in
the exercise of the powers and authority conferred and vested in it by this
Agreement. Each of the undertakings and agreements made on the part of the
Trustee on behalf of the Trust Fund in the Certificates is made and intended
not as a personal undertaking or agreement by the Trustee but is made and
intended for the purpose of binding only the Trust Fund.
Section 8.04. Trustee May Own Certificates.
The Trustee in its individual or any other capacity may become the
owner or pledgee of Certificates with the same rights as it would have if it
were not the Trustee.
Section 8.05. Trustee's Fees and Expenses.
The Trustee, as compensation for its activities hereunder, shall be
entitled to withdraw from the Distribution Account on each Distribution Date
an amount equal to the Trustee Fee for such Distribution Date. The Trustee and
any director, officer, employee or agent of the Trustee shall be indemnified
by the Master Servicer and held harmless against any loss, liability or
expense (including reasonable attorney's fees) (i) incurred in connection with
any claim or legal action relating to (a) this Agreement, (b) the
Certificates, or (c) the performance of any of the Trustee's duties hereunder,
other than any loss, liability or expense incurred by reason of willful
misfeasance, bad faith or negligence in the performance of any of the
Trustee's duties hereunder and (ii) resulting from any error in any tax or
information return prepared by the Master Servicer. Such indemnity shall
survive the termination of this Agreement or the resignation or removal of the
Trustee hereunder. Without limiting the foregoing, the Master Servicer
covenants and agrees, except as otherwise agreed upon in writing by the
Depositor and the Trustee, and except for any such expense, disbursement or
advance as may arise from the Trustee's negligence, bad faith or willful
misconduct, to pay or reimburse the Trustee, for all reasonable expenses,
disbursements and advances incurred or made by the Trustee in accordance with
any of the provisions of this Agreement with respect to (A) the reasonable
compensation and the expenses and disbursements of its counsel not associated
with the closing of the issuance of the Certificates, (B) the reasonable
compensation, expenses and disbursements of any accountant, engineer or
appraiser that is not regularly employed by the Trustee, to the extent that
the Trustee must engage such persons to perform acts or services hereunder and
(C) printing and engraving expenses in connection with preparing any
Definitive Certificates. Except as otherwise provided herein, the Trustee
shall not be entitled to payment or reimbursement for any routine ongoing
expenses incurred by the Trustee in the ordinary course of its duties as
Trustee, Registrar or Paying Agent hereunder or for any other expenses.
Section 8.06. Eligibility Requirements for the Trustee.
The Trustee hereunder shall at all times be a corporation or
association organized and doing business under the laws of a state or the
United States of America, authorized under such laws to exercise corporate
trust powers, having a combined capital and surplus of at least $50,000,000,
subject to super-vision or examination by federal or state authority and with
a credit rating which would not cause either of the Rating Agencies to reduce
their respective then current ratings of the Certificates (or having provided
such security from time to time as is sufficient to avoid such reduction) as
evidenced in writing by each Rating Agency. If such corporation or association
publishes reports of condition at least annually, pursuant to law or to the
requirements of the aforesaid supervising or examining authority, then for the
purposes of this Section 8.06 the combined capital and surplus of such
corporation or association shall be deemed to be its combined capital and
surplus as set forth in its most recent report of condition so published. In
case at any time the Trustee shall cease to be eligible in accordance with the
provisions of this Section 8.06, the Trustee shall resign immediately in the
manner and with the effect specified in Section 8.07. The entity serving as
Trustee may have normal banking and trust relationships with the Depositor and
its affiliates or the Master Servicer and its affiliates; provided, however,
that such entity cannot be an affiliate of the Seller, the Depositor or the
Master Servicer other than the Trustee in its role as successor to the Master
Servicer.
Section 8.07. Resignation and Removal of the Trustee.
The Trustee may at any time resign and be discharged from the trusts
hereby created by giving written notice of resignation to the Depositor, the
Master Servicer, each Rating Agency not less than 60 days before the date
specified in such notice, when, subject to Section 8.08, such resignation is
to take effect, and acceptance by a successor trustee in accordance with
Section 8.08 meeting the qualifications set forth in Section 8.06. If no
successor trustee meeting such qualifications shall have been so appointed and
have accepted appointment within 30 days after the giving of such notice or
resignation, the resigning Trustee may petition any court of competent
jurisdiction for the appointment of a successor trustee.
If at any time the Trustee shall cease to be eligible in accordance
with the provisions of Section 8.06 and shall fail to resign after written
request thereto by the Depositor, or if at any time the Trustee shall become
incapable of acting, or shall be adjudged as bankrupt or insolvent, or a
receiver of the Trustee or of its property shall be appointed, or any public
officer shall take charge or control of the Trustee or of its property or
affairs for the purpose of rehabilitation, conservation or liquidation, or a
tax is imposed with respect to the Trust Fund by any state in which the
Trustee or the Trust Fund is located and the imposition of such tax would be
avoided by the appointment of a different trustee, then the Depositor or the
Master Servicer may remove the Trustee and appoint a successor trustee by
written instrument, in triplicate, one copy of which shall be delivered to the
Trustee, one copy to the Master Servicer and one copy to the successor
trustee.
The Holders of Certificates entitled to at least 51% of the Voting
Rights may at any time remove the Trustee and appoint a successor trustee by
written instrument or instruments, in triplicate, signed by such Holders or
their attorneys-in-fact duly authorized, one complete set of which shall be
delivered by the successor Trustee to the Master Servicer, one complete set to
the Trustee so removed and one complete set to the successor so appointed.
Notice of any removal of the Trustee shall be given to each Rating Agency by
the successor trustee.
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
become effective upon acceptance of appointment by the successor trustee as
provided in Section 8.08.
Section 8.08. Successor Trustee.
Any successor trustee appointed as provided in Section 8.07 shall
execute, acknowledge and deliver to the Depositor and to its predecessor
trustee and the Master Servicer an instrument accepting such appointment
hereunder and thereupon the resignation or removal of the predecessor trustee
shall become effective and such successor trustee, without any further act,
deed or conveyance, shall become fully vested with all the rights, powers,
duties and obligations of its predecessor hereunder, with the like effect as
if originally named as trustee herein. The Depositor, the Master Servicer and
the predecessor trustee shall execute and deliver such instruments and do such
other things as may reasonably be required for more fully and certainly
vesting and confirming in the successor trustee all such rights, powers,
duties, and obligations.
No successor trustee shall accept appointment as provided in this
Section 8.08 unless at the time of such acceptance such successor trustee
shall be eligible under the provisions of Section 8.06 and its appointment
shall not adversely affect the then current rating of the Certificates.
Upon acceptance of appointment by a successor trustee as provided in
this Section 8.08, the Depositor shall mail notice of the succession of such
trustee hereunder to all Holders of Certificates. If the Depositor fails to
2mail such notice within 10 days after acceptance of appointment by the
successor trustee, the successor trustee shall cause such notice to be mailed
at the expense of the Depositor.
Section 8.09. Merger or Consolidation of the Trustee.
Any corporation into which the Trustee may be merged or converted or
with which it may be consolidated or any corporation resulting from any
merger, conversion or consolidation to which the Trustee shall be a party, or
any corporation succeeding to the business of the Trustee, shall be the
successor of the Trustee hereunder, provided that such corporation shall be
eligible under the provisions of Section 8.06 without the execution or filing
of any paper or further act on the part of any of the parties hereto, anything
herein to the contrary notwithstanding.
Section 8.10. Appointment of Co-Trustee or Separate Trustee.
Notwithstanding any other provisions of this Agreement, at any time,
for the purpose of meeting any legal requirements of any jurisdiction in which
any part of the Trust Fund or property securing any Mortgage Note may at the
time be located, the Master Servicer and the Trustee acting jointly shall have
the power and shall execute and deliver all instruments to appoint one or more
Persons approved by the Trustee to act as co-trustee or co-trustees jointly
with the Trustee, or separate trustee or separate trustees, of all or any part
of the Trust Fund, and to vest in such Person or Persons, in such capacity and
for the benefit of the Certificateholders, such title to the Trust Fund or any
part thereof, whichever is applicable, and, subject to the other provisions of
this Section 8.10, such powers, duties, obligations, rights and trusts as the
Master Servicer and the Trustee may consider necessary or desirable. If the
Master Servicer shall not have joined in such appointment within 15 days after
the receipt by it of a request to do so, or in the case an Event of Default
shall have occurred and be continuing, the Trustee alone shall have the power
to make such appointment. No co-trustee or separate trustee hereunder shall be
required to meet the terms of eligibility as a successor trustee under Section
8.06 and no notice to Certificateholders of the appointment of any co-trustee
or separate trustee shall be required under Section 8.08.
Every separate trustee and co-trustee shall, to the extent permitted
by law, be appointed and act subject to the following provisions and
conditions:
(a) To the extent necessary to effectuate the purposes of this
Section 8.10, all rights, powers, duties and obligations conferred or imposed
upon the Trustee, except for the obligation of the Trustee under this
Agreement to advance funds on behalf of the Master Servicer, shall be
conferred or imposed upon and exercised or performed by the Trustee and such
separate trustee or co-trustee jointly (it being understood that such separate
trustee or co-trustee is not authorized to act separately without the Trustee
joining in such act), except to the extent that under any law of any
jurisdiction in which any particular act or acts are to be performed (whether
as Trustee hereunder or as successor to the Master Servicer hereunder), the
Trustee shall be incompetent or unqualified to perform such act or acts, in
which event such rights, powers, duties and obligations (including the holding
of title to the applicable Trust Fund or any portion thereof in any such
jurisdiction) shall be exercised and performed singly by such separate trustee
or co-trustee, but solely at the direction of the Trustee;
(b) No trustee hereunder shall be held personally liable by reason
of any act or omission of any other trustee hereunder and such appointment
shall not, and shall not be deemed to, constitute any such separate trustee or
co-trustee as agent of the Trustee;
(c) The Trustee may at any time accept the resignation of or remove
any separate trustee or co-trustee; and
(d) The Master Servicer, and not the Trustee, shall be liable for
the payment of reasonable compensation, reimbursement and indemnification to
any such separate trustee or co-trustee.
Any notice, request or other writing given to the Trustee shall be
deemed to have been given to each of the separate trustees and co-trustees,
when and as effectively as if given to each of them. Every instrument
appointing any separate trustee or co-trustee shall refer to this Agreement
and the conditions of this Article VIII. Each separate trustee and co-trustee,
upon its acceptance of the trusts conferred, shall be vested with the estates
or property specified in its instrument of appointment, either jointly with
the Trustee or separately, as may be provided therein, subject to all the
provisions of this Agreement, specifically including every provision of this
Agreement relating to the conduct of, affecting the liability of, or affording
protection to, the Trustee. Every such instrument shall be filed with the
Trustee and a copy thereof given to the Master Servicer and the Depositor.
Any separate trustee or co-trustee may, at any time, constitute the
Trustee its agent or attorney-in-fact, with full power and authority, to the
extent not prohibited by law, to do any lawful act under or in respect of this
Agreement on its behalf and in its name. If any separate trustee or co-trustee
shall die, become incapable of acting, resign or be removed, all of its
estates, properties, rights, remedies and trusts shall vest in and be
exercised by the Trustee, to the extent permitted by law, without the
appointment of a new or successor trustee.
Section 8.11. Tax Matters.
It is intended that the assets with respect to which any REMIC
election pertaining to the Trust Fund is to be made, as set forth in the
Preliminary Statement, shall constitute, and that the conduct of matters
relating to such assets shall be such as to qualify such assets as, a "real
estate mortgage investment conduit" as defined in and in accordance with the
REMIC Provisions. In furtherance of such intention, the Trustee covenants and
agrees that it shall act as agent (and the Trustee is hereby appointed to act
as agent) on behalf of any such REMIC and that in such capacity it shall: (a)
prepare and file, or cause to be prepared and filed, in a timely manner, a
U.S. Real Estate Mortgage Investment Conduit Income Tax Return (Form 1066 or
any successor form adopted by the Internal Revenue Service) and prepare and
file or cause to be prepared and filed with the Internal Revenue Service and
applicable state or local tax authorities income tax or information returns
for each taxable year with respect to any such REMIC, containing such
information and at the times and in the manner as may be required by the Code
or state or local tax laws, regulations, or rules, and furnish or cause to be
furnished to Certificateholders the schedules, statements or information at
such times and in such manner as may be required thereby; (b) within thirty
days of the Closing Date, furnish or cause to be furnished to the Internal
Revenue Service, on Forms 8811 or as otherwise may be required by the Code,
the name, title, address, and telephone number of the person that the holders
of the Certificates may contact for tax information relating thereto, together
with such additional information as may be required by such Form, and update
such information at the time or times in the manner required by the Code; (c)
make or cause to be made an election that such assets be treated as a REMIC on
the federal tax return for its first taxable year (and, if necessary, under
applicable state law); (d) prepare and forward, or cause to be prepared and
forwarded, to the Certificateholders and to the Internal Revenue Service and,
if necessary, state tax authorities, all information returns and reports as
and when required to be provided to them in accordance with the REMIC
Provisions, including without limitation, the calculation of any original
issue discount using the Prepayment Assumption (as defined in the Prospectus
Supplement); (e) provide information necessary for the computation of tax
imposed on the transfer of a Residual Certificate to a Person that is not a
Permitted Transferee, or an agent (including a broker, nominee or other
middleman) of a Non-Permitted Transferee, or a pass-through entity in which a
Non-Permitted Transferee is the record holder of an interest (the reasonable
cost of computing and furnishing such information may be charged to the Person
liable for such tax); (f) to the extent that they are under its control,
conduct matters relating to such assets at all times that any Certificates are
outstanding so as to maintain the status as a REMIC under the REMIC
Provisions; (g) not knowingly or intentionally take any action or omit to take
any action that would cause the termination of the REMIC status; (h) pay, from
the sources specified in the last paragraph of this Section 8.11, the amount
of any federal or state tax, including prohibited transaction taxes as
described below, imposed on such REMIC prior to its termination when and as
the same shall be due and payable (but such obligation shall not prevent the
Trustee or any other appropriate Person from contesting any such tax in
appropriate proceedings and shall not prevent the Trustee from withholding
payment of such tax, if permitted by law, pending the outcome of such
proceedings); (i) ensure that federal, state or local income tax or
information returns shall be signed by the Trustee or such other person as may
be required to sign such returns by the Code or state or local laws,
regulations or rules; (j) maintain records relating to such REMIC, including
but not limited to the income, expenses, assets and liabilities thereof and
the fair market value and adjusted basis of the assets determined at such
intervals as may be required by the Code, as may be necessary to prepare the
foregoing returns, schedules, statements or information; and (k) as and when
necessary and appropriate, represent such REMIC in any administrative or
judicial proceedings relating to an examination or audit by any governmental
taxing authority, request an administrative adjustment as to any taxable year
of such REMIC, enter into settlement agreements with any governmental taxing
agency, extend any statute of limitations relating to any tax item of such
REMIC, and otherwise act on behalf of such REMIC in relation to any tax matter
or controversy involving it.
In order to enable the Trustee to perform its duties as set forth
herein, the Depositor shall provide, or cause to be provided, to the Trustee
within ten (10) days after the Closing Date all information or data that the
Trustee requests in writing and determines to be relevant for tax purposes to
the valuations and offering prices of the Certificates, including, without
limitation, the price, yield, prepayment assumption and projected cash flows
of the Certificates and the Mortgage Loans. Moreover, in the case of each
Class of Adjustable Rate Certificates, the Depositor shall provide information
to the Trustee concerning the value to each such Class of the right to receive
Basis Risk CarryForward Amounts from the Excess Reserve Fund. Thereafter, the
Depositor shall provide to the Trustee promptly upon written request therefor
any such additional information or data that the Trustee may, from time to
time, reasonably request in order to enable the Trustee to perform its duties
as set forth herein. The Depositor hereby indemnifies the Trustee for any
losses, liabilities, damages, claims or expenses of the Trustee arising from
any errors or miscalculations of the Trustee that result from any failure of
the Depositor to provide, or to cause to be provided, accurate information or
data to the Trustee on a timely basis.
In the event that any tax is imposed on "prohibited transactions" of
such REMIC as defined in Section 860F(a)(2) of the Code, on the "net income
from foreclosure property" of such REMIC as defined in Section 860G(c) of the
Code, on any contribution to such REMIC after the Startup Day pursuant to
Section 860G(d) of the Code, or any other tax is imposed, including, without
limitation, any minimum tax imposed upon such REMIC pursuant to Sections 23153
and 24874 of the California Revenue and Taxation Code, if not paid as
otherwise provided for herein, such tax shall be paid by (i) the Trustee, if
any such other tax arises out of or results from negligence of the Trustee in
the perfomance of any of its obligations under this Agreement, (ii) the Master
Servicer or the Seller, in the case of any such minimum tax, if such tax
arises out of or results from a breach by the Master Servicer or Seller of any
of their obligations under this Agreement or (iii) the Seller, if any such tax
arises out of or results from the Seller's obligation to repurchase a Mortgage
Loan pursuant to Section 2.02 or 2.03 or (iv) in all other cases, or in the
event that the Trustee, the Master Servicer or the Seller fails to honor its
obligations under the preceding clauses (i), (ii) or (iii), any such tax will
be paid with amounts otherwise to be distributed to the Certificateholders, as
provided in Section 3.09(b).
Section 8.12. Periodic Filings.
Pursuant to written instructions from the Depositor, the Trustee
shall prepare, execute and file all periodic reports required under the
Securities Exchange Act of 1934 in conformity with the terms of the relief
granted to issuers similar to the Trust Fund. In connection with the
preparation and filing of such periodic reports, the Depositor and the Master
Servicer shall timely provide to the Trustee all material information
available to them which is required to be included in such reports and not
known to them to be in the possession of the Trustee and such other
information as the Trustee reasonably may request from either of them and
otherwise reasonably shall cooperate with the Trustee. The Trustee shall have
no liability with respect to any failure to properly prepare or file such
periodic reports resulting from or relating to the Trustee's inability or
failure to obtain any information not resulting from its own negligence or
willful misconduct.
Section 8.13. Tax Classification of Class BB Certificate
For federal income tax purposes, the Trustee shall treat the Class
BB Certificate as debt obligations of the holder of the Class X Certificate
that are secured by the Class X Certificate and the amounts distributable on
the Class X Certificate.
Section 8.14. Tax Classification of the Excess Reserve Fund Account
For federal income tax purposes, the Trustee shall treat the Excess
Reserve Fund Account as an outside reserve fund, within the meaning of
Treasury Regulation ss. 1.860-2(h), that is beneficially owned by the holder
of the Class X Certificate. The Trustee shall treat the rights that each Class
of Adjustable Rate Certificates has to receive payments of Basis Risk
CarryForward Amounts from the Excess Reserve Fund Account as rights to receive
payments under an interest rate cap contract written by the Class X
Certificateholder in favor of each such Class. Accordingly, each Class of
Adjustable Rate Certificates will comprise two components - an Upper Tier
Regular Interest and an interest in a cap contract. The Trustee shall allocate
the issue price for a Class of Adjustable Rate Certificates between two
components for purposes of determining the issue price of the Upper Tier
Regular Interest component.
<PAGE>
ARTICLE IX
TERMINATION
Section 9.01. Termination upon Liquidation or Purchase of the
Mortgage Loans.
Subject to Section 9.03, the obligations and responsibilities of the
Depositor, the Master Servicer and the Trustee created hereby with respect to
the Trust Fund shall terminate upon the earlier of (a) the purchase by the
Master Servicer of all Mortgage Loans (and REO Properties) at the price equal
to the sum of (i) 100% of the Stated Principal Balance of each Mortgage Loan
(other than in respect of REO Property) plus one month's accrued interest
thereon at the applicable Adjusted Mortgage Rate and (ii) the lesser of (x)
the appraised value of any REO Property as determined by the higher of two
appraisals completed by two independent appraisers selected by the Master
Servicer at the expense of the Master Servicer and (y) the Stated Principal
Balance of each Mortgage Loan related to any REO Property, in each case plus
accrued and unpaid interest thereon at the applicable Adjusted Net Mortgage
Rate and (b) the later of (i) the maturity or other liquidation (or any
Advance with respect thereto) of the last Mortgage Loan remaining in the Trust
Fund and the disposition of all REO Property and (ii) the distribution to
Certificateholders of all amounts required to be distributed to them pursuant
to this Agreement. In no event shall the trusts created hereby continue beyond
the expiration of 21 years from the death of the 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 right to repurchase all Mortgage Loans and REO Properties
pursuant to clause (a) above shall be conditioned upon the aggregate Stated
Principal Balance of the Mortgage Loans, at the time of any such repurchase,
aggregating ten percent or less of the aggregate Cut-off Date Principal
Balance of the Mortgage Loans.
Section 9.02. Final Distribution on the Certificates.
If on any Determination Date, the Master Servicer determines that
there are no Outstanding Mortgage Loans and no other funds or assets in the
Trust Fund other than the funds in the Certificate Account, the Master
Servicer shall direct the Trustee promptly to send a final distribution notice
to each Certificateholder. If the Master Servicer elects to terminate the
Trust Fund pursuant to clause (a) of Section 9.01, at least 20 days prior to
the date notice is to be mailed to the affected Certificateholders the Master
Servicer shall notify the Depositor and the Trustee of the date the Master
Servicer intends to terminate the Trust Fund and of the applicable repurchase
price of the Mortgage Loans and REO Properties.
Notice of any termination of the Trust Fund, specifying the
Distribution Date on which Certificateholders may surrender their Certificates
for payment of the final distribution and cancellation, shall be given
promptly by the Trustee by letter to Certificateholders mailed not earlier
than the 15th day and not later than the 10th day of the month next preceding
the month of such final distribution. Any such notice shall specify (a) the
Distribution Date upon which final distribution on the Certificates will be
made upon presentation and surrender of Certificates at the office therein
designated, (b) the amount of such final distribution, (c) the location of the
office or agency at which such presentation and surrender must be made, and
(d) that the Record Date otherwise applicable to such Distribution Date is not
applicable, distributions being made only upon presentation and surrender of
the Certificates at the office therein specified. The Master Servicer will
give such notice to each Rating Agency at the time such notice is given to
Certificateholders.
In the event such notice is given, the Master Servicer shall cause
all funds in the Certificate Account to be remitted to the Trustee for deposit
in the Distribution Account on the Business Day prior to the applicable
Distribution Date in an amount equal to the final distribution in respect of
the Certificates. Upon such final deposit with respect to the Trust Fund and
the receipt by the Trustee of a Request for Release therefor, the Trustee
shall promptly release to the Master Servicer the Mortgage Files for the
Mortgage Loans.
Upon presentation and surrender of the Certificates, the Trustee
shall cause to be distributed to the Certificateholders of each Class, in each
case on the final Distribution Date and in the order set forth in Section
4.02, in proportion to their respective Percentage Interests, with respect to
Certificateholders of the same Class, an amount equal to (i) as to each Class
of Regular Certificates (except the Class X Certificate) and the Class BB
Certificates, the Certificate Balance thereof plus for each such Class and the
Class X Certificate accrued interest thereon in the case of an
interest-bearing Certificate and (ii) as to the Residual Certificates, the
amount, if any, which remains on deposit in the Distribution Account (other
than the amounts retained to meet claims) after application pursuant to clause
(i) above.
In the event that any affected Certificateholders shall not
surrender Certificates for cancellation within six months after the date
specified in the above mentioned written notice, the Trustee shall give a
second written notice to the remaining Certificateholders to surrender their
Certificates for cancellation and receive the final distribution with respect
thereto. If within six months after the second notice all the applicable
Certificates shall not have been surrendered for cancellation, the Trustee may
take appropriate steps, or may appoint an agent to take appropriate steps, to
contact the remaining Certificateholders concerning surrender of their
Certificates, and the cost thereof shall be paid out of the funds and other
assets which remain a part of the Trust Fund. If within one year after the
second notice all Certificates shall not have been surrendered for
cancellation, the Class R Certificateholders shall be entitled to all
unclaimed funds and other assets of the Trust Fund which remain subject
hereto.
Section 9.03. Additional Termination Requirements.
In the event the Master Servicer exercises its purchase option with
respect to the Mortgage Loans as provided in Section 9.01, the Trust Fund
shall be terminated in accordance with the following additional requirements,
unless the Trustee has been supplied with an Opinion of Counsel, at the
expense of the Master Servicer, to the effect that the failure to comply with
the requirements of this Section 9.03 will not (i) result in the imposition of
taxes on "prohibited transactions" on either REMIC as defined in Section 860F
of the Code, or (ii) cause either the Lower Tier REMIC or the Upper Tier REMIC
to fail to qualify as a REMIC at any time that any Certificates are
outstanding:
(a) The Trustee shall sell all of the assets of the Trust Fund to
the Master Servicer, and, within 90 days of such sale, shall distribute to the
Certificateholders the proceeds of such sale in complete liquidation of each
of the Lower Tier REMIC and the Upper Tier REMIC.
(b) The Trustee shall attach a statement to the final federal income
tax return for each of the Lower Tier REMIC and the Upper Tier REMIC stating
that pursuant to Treasury Regulation ss. 1.860F-1, the first day of the 90-day
liquidation period for each such REMIC was the date on which the Trustee sold
the assets of the Trust Fund to the Master Servicer.
<PAGE>
ARTICLE X
MISCELLANEOUS PROVISIONS
Section 10.01. Amendment.
This Agreement may be amended from time to time by the Depositor,
the Master Servicer and the Trustee without the consent of any of the
Certificateholders (i) to cure any ambiguity or mistake, (ii) to correct any
defective provision herein or to supplement any provision herein which may be
inconsistent with any other provision herein, (iii) to add to the duties of
the Depositor, the Seller or the Master Servicer, (iv) to add any other
provisions with respect to matters or questions arising hereunder or (v) to
modify, alter, amend, add to or rescind any of the terms or provisions
contained in this Agreement; provided, that any action pursuant to clauses
(iv) or (v) above shall not, as evidenced by an Opinion of Counsel (which
Opinion of Counsel shall not be an expense of the Trustee or the Trust Fund),
adversely affect in any material respect the interests of any
Certificateholder; and provided further that the amendment shall not be deemed
to adversely affect in any material respect the interests of the
Certificateholders if the Person requesting the amendment obtains a letter
from each Rating Agency stating that the amendment would not result in the
downgrading or withdrawal of the respective ratings then assigned to the
Certificates; it being understood and agreed that any such letter in and of
itself will not represent a determination as to the materiality of any such
amendment and will represent a determination only as to the credit issues
affecting any such rating. The Trustee, the Depositor and the Master Servicer
also may at any time and from time to time amend this Agreement without the
consent of the Certificateholders to modify, eliminate or add to any of its
provisions to such extent as shall be necessary or helpful to (i) maintain the
qualification of the Lower Tier REMIC and the Upper Tier REMIC under the Code,
(ii) avoid or minimize the risk of the imposition of any tax on the Lower Tier
REMIC or the Upper Tier REMIC pursuant to the Code that would be a claim at
any time prior to the final redemption of the Certificates or (iii) comply
with any other requirements of the Code, provided that the Trustee has been
provided an Opinion of Counsel, which opinion shall be an expense of the party
requesting such opinion but in any case shall not be an expense of the Trustee
or the Trust Fund, to the effect that such action is necessary or helpful to,
as applicable, (i) maintain such qualification, (ii) avoid or minimize the
risk of the imposition of such a tax or (iii) comply with any such
requirements of the Code.
This Agreement may also be amended from time to time by the
Depositor, the Master Servicer and the Trustee with the consent of the Holders
of Certificates of Certificates evidencing Percentage Interests aggregating
not less than 662/3% of each Class of Certificates affected thereby for the
purpose of adding any provisions to or changing in any manner or eliminating
any of the provisions of this Agreement or of modifying in any manner the
rights of the Holders of Certificates; provided, however, that no such
amendment shall (i) reduce in any manner the amount of, or delay the timing
of, payments required to be distributed on any Certificate without the consent
of the Holder of such Certificate, (ii) adversely affect in any material
respect the interests of the Holders of any Class of Certificates in a manner
other than as described in (i), without the consent of the Holders of
Certificates of such Class evidencing, as to such Class, Percentage Interests
aggregating not less than 662/3%, or (iii) reduce the aforesaid percentages of
Certificates the Holders of which are required to consent to any such
amendment, without the consent of the Holders of all such Certificates then
outstanding.
Notwithstanding any contrary provision of this Agreement, the
Trustee shall not consent to any amendment to this Agreement unless it shall
have first received an Opinion of Counsel, which opinion shall not be an
expense of the Trustee or the Trust Fund, to the effect that such amendment
will not cause the imposition of any tax on any REMIC or the
Certificateholders or cause any REMIC to fail to qualify as a REMIC at any
time that any Certificates are outstanding.
Promptly after the execution of any amendment to this Agreement
requiring the consent of Certificateholders, the Trustee shall furnish written
notification of the substance or a copy of such amendment to each
Certificateholder and each Rating Agency.
It shall not be necessary for the consent of Certificateholders
under this Section 10.01 to approve the particular form of any proposed
amendment, but it shall be sufficient if such consent shall approve the
substance thereof. The manner of obtaining such consents and of evidencing the
authorization of the execution thereof by Certificateholders shall be subject
to such reasonable regulations as the Trustee may prescribe.
Nothing in this Agreement shall require the Trustee to enter into an
amendment without receiving an Opinion of Counsel (which Opinion shall not be
an expense of the Trustee or the Trust Fund), satisfactory to the Trustee that
(i) such amendment is permitted and is not prohibited by this Agreement and
that all requirements for amending this Agreement have been complied with; and
(ii) either (A) the amendment does not adversely affect in any material
respect the interests of any Certificateholder or (B) the conclusion set forth
in the immediately preceding clause (A) is not required to be reached pursuant
to this Section 10.01.
Section 10.02. Recordation of Agreement; Counterparts.
This Agreement 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 Master Servicer at its
expense, but only upon receipt of an Opinion of Counsel to the effect that
such recordation materially and beneficially affects the interests of the
Certificateholders.
For the purpose of facilitating the recordation of this Agreement as
herein provided and for other purposes, this Agreement may be executed
simultaneously in any number of counterparts, each of which counterparts shall
be deemed to be an original, and such counterparts shall constitute but one
and the same instrument.
Section 10.03. Governing Law.
THIS AGREEMENT SHALL BE CONSTRUED IN ACCORDANCE WITH AND GOVERNED BY
THE SUBSTANTIVE LAWS OF THE STATE OF NEW YORK APPLICABLE TO AGREEMENTS MADE
AND TO BE PERFORMED IN THE STATE OF NEW YORK AND THE OBLIGATIONS, RIGHTS AND
REMEDIES OF THE PARTIES HERETO AND THE CERTIFICATEHOLDERS SHALL BE DETERMINED
IN ACCORDANCE WITH SUCH LAWS.
Section 10.04. Intention of Parties.
It is the express intent of the parties hereto that the conveyance
(i) of the Mortgage Loans by the Seller to the Depositor and (ii) of the Trust
Fund by the Depositor to the Trustee each be, and be construed as, an absolute
sale thereof. It is, further, not the intention of the parties that such
conveyances be deemed a pledge thereof. However, in the event that,
notwithstanding the intent of the parties, such assets are held to be the
property of the Seller or Depositor, as the case may be, or if for any other
reason this Agreement is held or deemed to create a security interest in
either such assets, then (i) this Agreement shall be deemed to be a security
agreement within the meaning of the Uniform Commercial Code of the State of
New York and (ii) the conveyances provided for in this Agreement shall be
deemed to be an assignment and a grant (i) by the Seller to the Depositor or
(ii) by the Depositor to the Trustee, for the benefit of the
Certificateholders, of a security interest in all of the assets transferred,
whether now owned or hereafter acquired.
The Seller and the Depositor for the benefit of the
Certificateholders shall, to the extent consistent with this Agreement, take
such actions as may be necessary to ensure that, if this Agreement were deemed
to create a security interest in the Trust Fund, such security interest would
be deemed to be a perfected security interest of first priority under
applicable law and will be maintained as such throughout the term of the
Agreement. The Depositor shall arrange for filing any Uniform Commercial Code
continuation statements in connection with any security interest granted or
assigned to the Trustee for the benefit of the Certificateholders.
Section 10.05. Notices.
(a) The Trustee shall use its best efforts to promptly provide
notice to each Rating Agency with respect to each of the following of which it
has actual knowledge:
1. Any material change or amendment to this Agreement;
2. The occurrence of any Event of Default that has not been cured;
3. The resignation or termination of the Master Servicer or the
Trustee and the appointment of any successor;
4. The repurchase or substitution of Mortgage Loans pursuant to
Section 2.03; and
5. The final payment to Certificateholders.
In addition, the Trustee shall promptly furnish to each Rating
Agency copies of the following:
1. Each report to Certificateholders described in Section 4.03;
2. Each annual statement as to compliance described in Section 3.17;
3. Each annual independent public accountants' servicing report
described in Section 3.18; and
4. Any notice of a purchase of a Mortgage Loan pursuant to Section
2.02, 2.03 or 3.11.
(b) All directions, demands and notices hereunder shall be in
writing and shall be deemed to have been duly given when delivered to (a) in
the case of the Depositor, IndyMac ABS, Inc., 155 North Lake Avenue, Pasadena,
California 91101, Attention: Secondary Marketing Department, (b) in the case
of the Master Servicer, IndyMac, Inc., 155 North Lake Avenue, Pasadena,
California 91101, Attention: Secondary Marketing Department or such other
address as may be hereafter furnished to the Depositor and the Trustee by the
Master Servicer in writing, (c) in the case of the Trustee, The Bank of New
York, 101 Barclay Street, 12W, New York, New York 10286, Attention:
Mortgage-Backed Securities Group, Series SPMD 2000-A, or such other address as
the Trustee may hereafter furnish to the Depositor or Master Servicer; and (d)
in the case of each of the Rating Agencies, the address specified therefor in
the definition corresponding to the name of such Rating Agency. Notices to
Certificateholders shall be deemed given when mailed, first class postage
prepaid, to their respective addresses appearing in the Certificate Register.
Section 10.06. Severability of Provisions.
If any one or more of the covenants, agreements, provisions or terms
of this Agreement shall be for any reason whatsoever held invalid, then such
covenants, agreements, provisions or terms shall be deemed severable from the
remaining covenants, agreements, provisions or terms of this Agreement and
shall in no way affect the validity or enforceability of the other provisions
of this Agreement or of the Certificates or the rights of the Holders thereof.
Section 10.07. Assignment.
Notwithstanding anything to the contrary contained herein, except as
provided in Section 6.02, this Agreement may not be assigned by the Master
Servicer without the prior written consent of the Trustee and Depositor.
Section 10.08. Limitation on Rights of Certificateholders.
The death or incapacity of any Certificateholder shall not operate
to terminate this Agreement or the trust created hereby, nor entitle such
Certificateholder's legal representative or heirs to claim an accounting or to
take any action or commence any proceeding in any court for a petition or
winding up of the trust created hereby, or otherwise affect the rights,
obligations and liabilities of the parties hereto or any of them.
No Certificateholder shall have any right to vote (except as
provided herein) or in any manner otherwise control the operation and
management of the Trust Fund, or the obligations of the parties hereto, nor
shall anything herein set forth or contained in the terms of the Certificates
be construed so as to constitute the Certificateholders from time to time as
partners or members of an association; nor shall any Certificateholder be
under any liability to any third party by reason of any action taken by the
parties to this Agreement pursuant to any provision hereof.
No Certificateholder shall have any right by virtue or by availing
itself of any provisions of this Agreement to institute any suit, action or
proceeding in equity or at law upon or under or with respect to this
Agreement, unless such Holder previously shall have given to the Trustee a
written notice of an Event of Default and of the continuance thereof, as
herein provided, and unless the Holders of Certificates evidencing not less
than 25% of the Voting Rights evidenced by the Certificates shall also have
made written request to the Trustee to institute such action, suit or
proceeding in its own name as Trustee hereunder and shall have offered to the
Trustee such reasonable indemnity as it may require against the costs,
expenses, and liabilities to be incurred therein or thereby, and the Trustee,
for 60 days after its receipt of such notice, request and offer of indemnity
shall have neglected or refused to institute any such action, suit or
proceeding; it being understood and intended, and being expressly covenanted
by each Certificateholder with every other Certificateholder and the Trustee,
that no one or more Holders of Certificates shall have any right in any manner
whatever by virtue or by availing itself or themselves of any provisions of
this Agreement to affect, disturb or prejudice the rights of the Holders of
any other of the Certificates, or to obtain or seek to obtain priority over or
preference to any other such Holder or to enforce any right under this
Agreement, except in the manner herein provided and for the common benefit of
all Certificateholders. For the protection and enforcement of the provisions
of this Section 10.08, each and every Certificateholder and the Trustee shall
be entitled to such relief as can be given either at law or in equity.
Section 10.09. Inspection and Audit Rights.
The Master Servicer agrees that, on reasonable prior notice, it will
permit any representative of the Depositor or the Trustee during such Person's
normal business hours, to examine all the books of account, records, reports
and other papers of such Person relating to the Mortgage Loans, to make copies
and extracts therefrom, to cause such books to be audited by independent
certified public accountants selected by the Depositor or the Trustee and to
discuss its affairs, finances and accounts relating to the Mortgage Loans with
its officers, employees and independent public accountants (and by this
provision the Master Servicer hereby authorizes said accountants to discuss
with such representative such affairs, finances and accounts), all at such
reasonable times and as often as may be reasonably requested. Any
out-of-pocket expense incident to the exercise by the Depositor or the Trustee
of any right under this Section 10.09 shall be borne by the Master Servicer.
Section 10.10. Certificates Nonassessable and Fully Paid.
It is the intention of the Depositor that Certificate holders shall
not be personally liable for obligations of the Trust Fund, that the interests
in the Trust Fund represented by the Certificates shall be nonassessable for
any reason whatsoever, and that the Certificates, upon due authentication
thereof by the Trustee pursuant to this Agreement, are and shall be deemed
fully paid.
* * * * * *
<PAGE>
IN WITNESS WHEREOF, the Depositor, the Trustee, the Seller and the
Master Servicer have caused their names to be signed hereto by their
respective officers thereunto duly authorized as of the day and year first
above written.
INDYMAC ABS, INC.
as Depositor
By:
--------------------------------------
Name:
Title:
THE BANK OF NEW YORK,
as Trustee
By:
--------------------------------------
Name:
Title:
INDYMAC, INC.
as Seller and Master Servicer
By:
--------------------------------------
Name:
Title:
<PAGE>
SCHEDULE I
Mortgage Loan Schedule
[Delivered at Closing to Trustee]
<PAGE>
SCHEDULE II
Home Equity Mortgage Loan Asset-Backed Certificates,
Series SPMD 2000-A
Representations and Warranties of the Seller/Master Servicer
------------------------------------------------------------
Indy Mac, Inc. ("IndyMac") hereby makes the representations and
warranties set forth in this Schedule II to the Depositor and the Trustee, as
of the Closing Date, or if so specified herein, as of the Cut-off Date.
Capitalized terms used but not otherwise defined in this Schedule II shall
have the meanings ascribed thereto in the Pooling and Servicing Agreement (the
"Pooling and Servicing Agreement") relating to the above-referenced Series,
among IndyMac, as seller and master servicer, IndyMac ABS, Inc., as depositor,
and The Bank of New York, as trustee.
(1) IndyMac is duly organized as a Delaware corporation and is
validly existing and in good standing under the laws of the State of
Delaware and is duly authorized and qualified to transact any and all
business contemplated by the Pooling and Servicing Agreement to be
conducted by IndyMac in any state in which a Mortgaged Property is
located or is otherwise not required under applicable law to effect such
qualification and, in any event, is in compliance with the doing business
laws of any such state, to the extent necessary to ensure its ability to
enforce each Mortgage Loan, to service the Mortgage Loans in accordance
with the terms of the Pooling and Servicing Agreement and to perform any
of its other obligations under the Pooling and Servicing Agreement in
accordance with the terms thereof.
(2) IndyMac has the full corporate power and authority to sell and
service each Mortgage Loan, and to execute, deliver and perform, and to
enter into and consummate the transactions contemplated by the Pooling
and Servicing Agreement and has duly authorized by all necessary
corporate action on the part of IndyMac the execution, delivery and
performance of the Pooling and Servicing Agreement; and the Pooling and
Servicing Agreement, assuming the due authorization, execution and
delivery thereof by the other parties thereto, constitutes a legal, valid
and binding obligation of IndyMac, enforceable against IndyMac in
accordance with its terms, except that (a) the enforceability thereof may
be limited by bankruptcy, insolvency, moratorium, receivership and other
similar laws relating to creditors' rights generally and (b) the remedy
of specific performance and injunctive and other forms of equitable
relief may be subject to equitable defenses and to the discretion of the
court before which any proceeding therefor may be brought.
(3) The execution and delivery of the Pooling and Servicing
Agreement by IndyMac, the sale and servicing of the Mortgage Loans by
IndyMac under the Pooling and Servicing Agreement, the consummation of
any other of the transactions contemplated by the Pooling and Servicing
Agreement, and the fulfillment of or compliance with the terms thereof
are in the ordinary course of business of IndyMac and will not (A) result
in a material breach of any term or provision of the charter or by-laws
of IndyMac or (B) materially conflict with, result in a material breach,
violation or acceleration of, or result in a material default under, the
terms of any other material agreement or instrument to which IndyMac is a
party or by which it may be bound, or (C) constitute a material violation
of any statute, order or regulation applicable to IndyMac of any court,
regulatory body, administrative agency or governmental body having
jurisdiction over IndyMac; and IndyMac is not in breach or violation of
any material indenture or other material agreement or instrument, or in
violation of any statute, order or regulation of any court, regulatory
body, administrative agency or governmental body having jurisdiction over
it which breach or violation may materially impair IndyMac's ability to
perform or meet any of its obligations under the Pooling and Servicing
Agreement.
(4) Each Servicer is an approved servicer of conventional mortgage
loans for FNMA or FHLMC or is a mortgagee approved by the Secretary of
Housing and Urban Development pursuant to Sections 203 and 211 of the
National Housing Act.
(5) No litigation is pending or, to the best of IndyMac's knowledge,
threatened against IndyMac that would prohibit the execution or delivery
of, or performance under, the Pooling and Servicing Agreement by IndyMac.
<PAGE>
SCHEDULE III
Home Equity Mortgage Loan Asset-Backed Certificates,
Series SPMD 2000-A
Representations and Warranties as to the Mortgage Loans
-------------------------------------------------------
IndyMac, Inc. ("IndyMac") hereby makes the representations and
warranties set forth in this Schedule III to the Depositor and the Trustee, as
of the Closing Date or Subsequent Transfer Date, as applicable, or if so
specified herein, as of the related Cut-off Date or date of origination of the
Mortgage Loan (as applicable). Capitalized terms used but not otherwise
defined in this Schedule III shall have the meanings ascribed thereto in the
Pooling and Servicing Agreement (the "Pooling and Servicing Agreement")
relating to the above-referenced Series, among IndyMac, as seller and master
servicer, IndyMac ABS, Inc., as depositor, and The Bank of New York, as
trustee.
(1) The information set forth on Schedule I to the Pooling and
Servicing Agreement with respect to each Mortgage Loan is true and
correct in all material respects as of the Closing Date or Subsequent
Transfer Date, as applicable.
(2) As of the Closing Date, all regularly scheduled monthly
payments due with respect to each Mortgage Loan up to and including the
Due Date immediately prior to the related Cut-off Date have been made;
and as of the related Cut-off Date, no Mortgage Loan had a regularly
scheduled monthly payment that was 60 or more days Delinquent during the
twelve months prior to the related Cut-off Date.
(3) With respect to any Mortgage Loan that is not a Cooperative
Loan, each Mortgage is a valid and enforceable first lien on the
Mortgaged Property subject only to (a) the lien of nondelinquent current
real property taxes and assessments and liens or interests arising under
or as a result of any federal, state or local law, regulation or
ordinance relating to hazardous wastes or hazardous substances and, if
the related Mortgaged Property is a unit in a condominium project or
planned unit development, any lien for common charges permitted by
statute or homeowner association fees, (b) covenants, conditions and
restrictions, rights of way, easements and other matters of public record
as of the date of recording of such Mortgage, such exceptions appearing
of record being generally acceptable to mortgage lending institutions in
the area wherein the related Mortgaged Property is located or
specifically reflected in the appraisal made in connection with the
origination of the related Mortgage Loan, and (c) other matters to which
like properties are commonly subject which do not materially interfere
with the benefits of the security intended to be provided by such
Mortgage.
(4) Immediately prior to the assignment of the Mortgage Loans
to the Depositor, the Seller had good title to, and was the sole owner
of, each Mortgage Loan free and clear of any pledge, lien, encumbrance or
security interest and had full right and authority, subject to no
interest or participation of, or agreement with, any other party, to sell
and assign the same pursuant to the Pooling and Servicing Agreement.
(5) As of the date of origination of each Mortgage Loan, there
was no delinquent tax or assessment lien against the related Mortgaged
Property.
(6) There is no valid offset, defense or counterclaim to any
Mortgage Note or Mortgage, including the obligation of the Mortgagor to
pay the unpaid principal of or interest on such Mortgage Note.
(7) There are no mechanics' liens or claims for work, labor or
material affecting any Mortgaged Property which are or may be a lien
prior to, or equal with, the lien of such Mortgage, except those which
are insured against by the title insurance policy referred to in item
(13) below.
(8) To the best of the Seller's knowledge, no Mortgaged
Property has been materially damaged by water, fire, earthquake,
windstorm, flood, tornado or similar casualty (excluding casualty from
the presence of hazardous wastes or hazardous substances, as to which the
Seller makes no representation) so as to affect adversely the value of
the related Mortgaged Property as security for such Mortgage Loan.
(9) Each Mortgage Loan at origination complied in all material
respects with applicable state and federal laws, including, without
limitation, usury, equal credit opportunity, real estate settlement
procedures, truth-in-lending and disclosure laws or any noncompliance
does not have a material adverse effect on the value of the related
Mortgage Loan.
(10) As of the Closing Date or Subsequent Transfer Date, as
applicable, the Seller has not modified the Mortgage in any material
respect (except that a Mortgage Loan may have been modified by a written
instrument which has been recorded or submitted for recordation, if
necessary, to protect the interests of the Certificateholders and which
has been delivered to the Trustee); satisfied, cancelled or subordinated
such Mortgage in whole or in part; released the related Mortgaged
Property in whole or in part from the lien of such Mortgage; or executed
any instrument of release, cancellation, modification or satisfaction
with respect thereto.
(11) A lender's policy of title insurance together with a
condominium endorsement and extended coverage endorsement, if applicable,
in an amount at least equal to the Cut-off Date Principal Balance of each
such Mortgage Loan or a commitment (binder) to issue the same was
effective on the date of the origination of each Mortgage Loan, each such
policy is valid and remains in full force and effect.
(12) Each Mortgage Loan was originated (within the meaning of
Section 3(a)(41) of the Securities Exchange Act of 1934, as amended) by
an entity that satisfied at the time of origination the requirements of
Section 3(a)(41) of the Securities Exchange Act of 1934, as amended.
(13) To the best of the Seller's knowledge, all of the
improvements which were included for the purpose of determining the
Appraised Value of the Mortgaged Property lie wholly within the
boundaries and building restriction lines of such property, and no
improvements on adjoining properties encroach upon the Mortgaged
Property, unless such failure to be wholly within such boundaries and
restriction lines or such encroachment, as the case may be, does not have
a material effect on the value of such Mortgaged Property.
(14) To the best of the Seller's knowledge, as of the date of
origination of each Mortgage Loan, no improvement located on or being
part of the Mortgaged Property is in violation of any applicable zoning
law or regulation unless such violation would not have a material adverse
effect on the value of the related Mortgaged Property. To the best of the
Seller's knowledge, all inspections, licenses and certificates required
to be made or issued with respect to all occupied portions of the
Mortgaged Property and, with respect to the use and occupancy of the
same, including but not limited to certificates of occupancy and fire
underwriting certificates, have been made or obtained from the
appropriate authorities, unless the lack thereof would not have a
material adverse effect on the value of such Mortgaged Property.
(15) The Mortgage Note and the related Mortgage are genuine,
and each is the legal, valid and binding obligation of the maker thereof,
enforceable in accordance with its terms and under applicable law.
(16) The proceeds of the Mortgage Loan have been fully
disbursed and there is no requirement for future advances thereunder.
(17) The related Mortgage contains customary and enforceable
provisions which render the rights and remedies of the holder thereof
adequate for the realization against the Mortgaged Property of the
benefits of the security, including, (i) in the case of a Mortgage
designated as a deed of trust, by trustee's sale, and (ii) otherwise by
judicial foreclosure.
(18) With respect to each Mortgage constituting a deed of
trust, a trustee, duly qualified under applicable law to serve as such,
has been properly designated and currently so serves and is named in such
Mortgage, and no fees or expenses are or will become payable by the
Certificateholders to the trustee under the deed of trust, except in
connection with a trustee's sale after default by the Mortgagor.
(19) At the related Cut-off Date, the improvements upon each
Mortgaged Property are covered by a valid and existing hazard insurance
policy with a generally acceptable carrier that provides for fire and
extended coverage and coverage for such other hazards as are customarily
required by institutional single family mortgage lenders in the area
where the Mortgaged Property is located, and the Seller has received no
notice that any premiums due and payable thereon have not been paid; the
Mortgage obligates the Mortgagor thereunder to maintain all such
insurance including flood insurance at the Mortgagor's cost and expense.
Anything to the contrary in this item (19) notwithstanding, no breach of
this item (19) shall be deemed to give rise to any obligation of the
Seller to repurchase or substitute for such affected Mortgage Loan or
Loans so long as the Master Servicer maintains a blanket policy pursuant
to the second paragraph of Section 3.10(a) of the Pooling and Servicing
Agreement.
(20) If at the time of origination of each Mortgage Loan, the
related Mortgaged Property was in an area then identified in the Federal
Register by the Federal Emergency Management Agency as having special
flood hazards, a flood insurance policy in a form meeting the
then-current requirements of the Flood Insurance Administration is in
effect with respect to such Mortgaged Property with a generally
acceptable carrier.
(21) To the best of the Seller's knowledge, there is no
proceeding pending or threatened for the total or partial condemnation of
any Mortgaged Property, nor is such a proceeding currently occurring.
(22) To the best of the Seller's knowledge, there is no
material event which, with the passage of time or with notice and the
expiration of any grace or cure period, would constitute a material
non-monetary default, breach, violation or event of acceleration under
the Mortgage or the related Mortgage Note; and the Seller has not waived
any material non-monetary default, breach, violation or event of
acceleration.
(23) Each Mortgage File contains an appraisal of the related
Mortgaged Property in a form acceptable to FNMA or FHLMC.
(24) Any leasehold estate securing a Mortgage Loan has a stated
term at least as long as the term of the related Mortgage Loan.
(25) Each Mortgage Loan was selected from among the outstanding
one- to four-family sub-prime mortgage loans in the Seller's sub-prime
mortgage portfolio at the Closing Date as to which the representations
and warranties made with respect to the Mortgage Loans set forth in this
Schedule III can be made. No such selection was made in a manner intended
to adversely affect the interests of the Certificateholders.
(26) No more than 1.67% (by aggregate Stated Principal Balance)
of the Mortgage Loans are Cooperative Loans.
(27) Each Cooperative Loan is secured by a valid, subsisting
and enforceable perfected first and second liens (in the case of Loan
Group 1) and first liens only (in the case of Loan Group 2) and security
interest in the related Mortgaged Property, subject only to (i) the
rights of the Cooperative Corporation to collect maintenance and
assessments from the Mortgagor, (ii) the lien of the Blanket Mortgage, if
any, on the Cooperative Property and of real property taxes, water and
sewer charges, rents and assessments on the Cooperative Property not yet
due and payable, and (iii) other matters to which like Cooperative Units
are commonly subject which do not materially interfere with the benefits
of the security intended to be provided by the Security Agreement or the
use, enjoyment, value or marketability of the Cooperative Unit. Each
original UCC financing statement, continuation statement or other
governmental filing or recordation necessary to create or preserve the
perfection and priority of the first priority lien and security interest
in the Cooperative Shares and Proprietary Lease has been timely and
properly made. Any security agreement, chattel mortgage or equivalent
document related to the Cooperative Loan and delivered to the sponsor or
its designee establishes in the Seller a valid and subsisting perfected
first or second lien (in the case of a Cooperative Loan that is in Loan
Group 1) and first lien only (in the case of a (Cooperative Loan that is
in Loan group 2) on and security interest in the property described
therein, and the Seller has full right to sell and assign the same.
(28) Each Cooperative Corporation qualifies as a "cooperative
housing corporation" as defined in Section 216 of the Code.
<PAGE>
SCHEDULE IV
Planned Balance Schedules
[Not applicable]
<PAGE>
[EXHIBITS A THROUGH E IN DOCUMENT # 688675]
<PAGE>
EXHIBIT G
FORM OF INITIAL CERTIFICATION OF TRUSTEE
[date]
[Depositor]
[Master Servicer]
[Seller]
__________________
__________________
Re: Pooling and Servicing Agreement among IndyMac ABS, Inc., as
Depositor, IndyMac, Inc., as Seller and Master Servicer, and
The Bank of New York, as Trustee, Home Equity Mortgage Loan
Asset-Backed Trust, Series SPMD 2000-A, Home Equity Mortgage
Loan Asset-Backed Certificates, Series SPMD 2000-A [and the
Subsequent Transfer Agreement dated as of [ ], 2000, among
IndyMac ABS, Inc., as Depositor, IndyMac, Inc., as Seller, and
The Bank of New York, as Trustee]
--------------------------------------------------------------
Gentlemen:
In accordance with Section 2.02 of the above-captioned Pooling and
Servicing Agreement (the "Pooling and Servicing Agreement"), [and the
above-captioned Subsequent Transfer Agreement] the undersigned, as Trustee,
hereby certifies that, as to each [Initial][Subsequent] Mortgage Loan listed
in the Mortgage Loan Schedule (other than any [Initial][Subsequent] Mortgage
Loan listed in the attached schedule), it has received:
(i) the original Mortgage Note, endorsed as provided in the following
form: "Pay to the order of ________, without recourse"; and
(ii) a duly executed assignment of the Mortgage (which may be included in
a blanket assignment or assignments); provided, however, that it has received
no assignment with respect to any Mortgage for which the related Mortgaged
Property is located in the Commonwealth of Puerto Rico.
Based on its review and examination and only as to the foregoing
documents, such documents appear regular on their face and related to such
[Initial][Subsequent] Mortgage Loan.
The Trustee has made no independent examination of any documents
contained in each Mortgage File beyond the review specifically required in the
Pooling and Servicing Agreement. The Trustee makes no representations as to:
(i) the validity, legality, sufficiency, enforceability or genuineness of any
of the documents contained in each Mortgage File of any of the
[Initial][Subsequent] Mortgage Loans identified on the Mortgage Loan Schedule,
or (ii) the collectability, insurability, effectiveness or suitability of any
such [Initial][Subsequent] Mortgage Loan.
<PAGE>
Capitalized words and phrases used herein shall have the respective
meanings assigned to them in the Pooling and Servicing Agreement.
THE BANK OF NEW YORK,
as Trustee
By:
-----------------------------------------
Name:
-------------------------------------
Title:
---------------------------------------
<PAGE>
EXHIBIT H
FORM OF FINAL CERTIFICATION OF TRUSTEE
[date]
[Depositor]
[Master Servicer]
[Seller]
___________________
___________________
Re: Pooling and Servicing Agreement among IndyMac ABS, Inc., as
Depositor, IndyMac, Inc., as Seller and Master Servicer, and
The Bank of New York, as Trustee, Home Equity Mortgage Loan
Asset-Backed Trust, Series SPMD 2000-A, Home Equity Mortgage
Loan Asset-Backed Certificates, Series SPMD 2000-A [and the
Subsequent Transfer Agreement dated as of [ ], 2000, among
IndyMac ABS, Inc., as Depositor, IndyMac, Inc., as Seller, and
The Bank of New York, as Trustee]
--------------------------------------------------------------
Gentlemen:
In accordance with Section 2.02 of the above-captioned Pooling and
Servicing Agreement (the "Pooling and Servicing Agreement") [and the
above-captioned Subsequent Transfer Agreement], the undersigned, as Trustee,
hereby certifies that as to each [Initial][Subsequent] Mortgage Loan listed in
the Mortgage Loan Schedule (other than any [Initial][Subsequent] Mortgage Loan
paid in full or listed on the attached Document Exception Report) it has
received:
(i) The original Mortgage Note, endorsed in the form provided in Section
2.01(f) of the Pooling and Servicing Agreement, with all intervening
endorsements showing a complete chain of endorsement from the originator to
the Seller.
(ii) The original recorded Mortgage.
(iii) A duly executed assignment of the Mortgage in the form provided in
Section 2.01(f) of the Pooling and Servicing Agreement; provided, however,
that it has received no assignment with respect to any Mortgage for which the
related Mortgaged Property is located in the Commonwealth of Puerto Rico, or,
if the Depositor has certified or the Trustee otherwise knows that the related
Mortgage has not been returned from the applicable recording office, a copy of
the assignment of the Mortgage (excluding information to be provided by the
recording office).
(iv) The original or duplicate original recorded assignment or
assignments of the Mortgage showing a complete chain of assignment from the
originator to the Seller.
(v) The original or duplicate original lender's title policy and all
riders thereto or, any one of an original title binder, an original
preliminary title report or an original title commitment, or a copy thereof
certified by the title company.
Based on its review and examination and only as to the foregoing
documents, (a) such documents appear regular on their face and related to such
[Initial][Subsequent] Mortgage Loan, and (b) the information set forth in
items (i), (ii), (iii), (iv), (vi) and (xi) of the definition of the "Mortgage
Loan Schedule" in Section 1.01 of the Pooling and Servicing Agreement
accurately reflects information set forth in the Mortgage File.
The Trustee has made no independent examination of any documents
contained in each Mortgage File beyond the review specifically required in the
Pooling and Servicing Agreement. The Trustee makes no representations as to:
(i) the validity, legality, sufficiency, enforceability or genuineness of any
of the documents contained in each Mortgage File of any of the Mortgage Loans
identified on the Mortgage Loan Schedule, or (ii) the collectability,
insurability, effectiveness or suitability of any such [Initial][Subsequent]
Mortgage Loan. Notwithstanding anything herein to the contrary, the Trustee
has made no determination and makes no representations as to whether (i) any
endorsement is sufficient to transfer all right, title and interest of the
party so endorsing, as Noteholder or assignee thereof, in and to that Mortgage
Note or (ii) any assignment is in recordable form or sufficient to effect the
assignment of and transfer to the assignee thereof, under the Mortgage to
which the assignment relates.
Capitalized words and phrases used herein shall have the respective
meanings assigned to them in the Pooling and Servicing Agreement.
THE BANK OF NEW YORK,
as Trustee
By:
-----------------------------------------
Name:
--------------------------------------
Title:
---------------------------------------
<PAGE>
EXHIBIT I
TRANSFER AFFIDAVIT
IndyMac ABS, Inc.,
Home Equity Mortgage Loan Asset-Backed Trust, Series SPMD 2000-A
Home Equity Mortgage Loan Asset-Backed Certificates,
Series SPMD 2000-A
STATE OF )
) ss.:
COUNTY OF )
The undersigned, being first duly sworn, deposes and says as follows:
1. The undersigned is an officer of ______________, the proposed
Transferee of an Ownership Interest in a Class R Certificate (the
"Certificate") issued pursuant to the Pooling and Servicing Agreement, (the
"Agreement"), relating to the above-referenced Series, by and among IndyMac
ABS, Inc., as depositor (the "Depositor"), IndyMac, Inc., as seller and master
servicer and The Bank of New York, as Trustee. Capitalized terms used, but not
defined herein or in Exhibit 1 hereto, shall have the meanings ascribed to
such terms in the Agreement. The Transferee has authorized the undersigned to
make this affidavit on behalf of the Transferee.
2. The Transferee is, as of the date hereof, and will be, as of the date
of the Transfer, a Permitted Transferee. The Transferee is acquiring its
Ownership Interest in the Certificate for its own account. The Transferee has
no knowledge that any such affidavit is false.
3. The Transferee has been advised of, and understands that (i) a tax
will be imposed on Transfers of the Certificate to Persons that are not
Permitted Transferees; (ii) such tax will be imposed on the transferor, or, if
such Transfer is through an agent (which includes a broker, nominee or
middleman) for a Person that is not a Permitted Transferee, on the agent; and
(iii) the Person otherwise liable for the tax shall be relieved of liability
for the tax if the subsequent Transferee furnished to such Person an affidavit
that such subsequent Transferee is a Permitted Transferee and, at the time of
Transfer, such Person does not have actual knowledge that the affidavit is
false.
4. The Transferee has been advised of, and understands that a tax will be
imposed on a "pass-through entity" holding the Certificate if at any time
during the taxable year of the pass-through entity a Person that is not a
Permitted Transferee is the record holder of an interest in such entity. The
Transferee understands that such tax will not be imposed for any period with
respect to which the record holder furnishes to the pass-through entity an
affidavit that such record holder is a Permitted Transferee and the
pass-through entity does not have actual knowledge that such affidavit is
false. (For this purpose, a "pass-through entity" includes a regulated
investment company, a real estate investment trust or common trust fund, a
partnership, trust or estate, and certain cooperatives and, except as may be
provided in Treasury Regulations, persons holding interests in pass-through
entities as a nominee for another Person.)
5. The Transferee has reviewed the provisions of Section 5.02(c) of the
Agreement (attached hereto as Exhibit 2 and incorporated herein by reference)
and understands the legal consequences of the acquisition of an Ownership
Interest in the Certificate including, without limitation, the restrictions on
subsequent Transfers and the provisions regarding voiding the Transfer and
mandatory sales. The Transferee expressly agrees to be bound by and to abide
by the provisions of Section 5.02(c) of the Agreement and the restrictions
noted on the face of the Certificate. The Transferee understands and agrees
that any breach of any of the representations included herein shall render the
Transfer to the Transferee contemplated hereby null and void.
6. The Transferee agrees to require a Transfer Affidavit from any Person
to whom the Transferee attempts to Transfer its Ownership Interest in the
Certificate, and in connection with any Transfer by a Person for whom the
Transferee is acting as nominee, trustee or agent, and the Transferee will not
Transfer its Ownership Interest or cause any Ownership Interest to be
Transferred to any Person that the Transferee knows is not a Permitted
Transferee. In connection with any such Transfer by the Transferee, the
Transferee agrees to deliver to the Trustee a certificate substantially in the
form set forth as Exhibit J 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. Either (i) 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, and
the Transferee is not acting on behalf of or investing plan assets of such a
plan, or (ii) the Transferee is an insurance company that is purchasing such
Certificate with funds contained in an "insurance company general account" as
such term is defined in Section V(e) of Prohibited Transaction Class Exemption
95-60 ("PTCE 95-60") and the purchase and holding of such Certificate are
covered under Sections I and III of PTCE 95-60.
* * *
<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 ____________, 20__.
------------------------------------------------
Print Name of Transferee
By:
--------------------------------------------
Name:
Title:
[Corporate Seal]
ATTEST:
_________________________
[Assistant] Secretary
Personally appeared before me the above-named ______________, known or
proved to me to be the same person who executed the foregoing instrument and
to be the ________________ of the Transferee, and acknowledged that he
executed the same as his free act and deed and the free act and deed of the
Transferee.
Subscribed and sworn before me this ____ day of _________, 20__.
_________________________________
NOTARY PUBLIC
My Commission expires the ____ day
of _____________, 20__
<PAGE>
EXHIBIT 1
to EXHIBIT I
Certain Definitions
"Ownership Interest": As to any Certificate, any ownership interest in
such Certificate, including any interest in such Certificate as the Holder
thereof and any other interest therein, whether direct or indirect, legal or
beneficial.
"Permitted Transferee": Any Person other than (i) the United States, any
State or political subdivision thereof, or any agency or instrumentality of
any of the foregoing, (ii) a foreign government, International Organization or
any agency or instrumentality of either of the foregoing, (iii) an
organization (except certain farmers' cooperatives described in Code Section
521) which is exempt from tax imposed by Chapter 1 of the Code (including the
tax imposed by Code Section 511 on unrelated business taxable income) on any
excess inclusions (as defined in Code Section 860E(c)(1)) with respect to any
Class R Certificate, (iv) rural electric and telephone cooperatives described
in Code Section 1381(a)(2)(c), (v) a Person that is not a U.S. Person, and
(vi) any other Person so designated by the Trustee based upon an Opinion of
Counsel that the Transfer of an Ownership Interest in a Class R Certificate to
such Person may cause the Trust Fund to fail to qualify as a REMIC at any time
that certain Certificates are Outstanding. The terms "United States," "State"
and "International Organization" shall have the meanings set forth in Code
Section 7701 or successor provisions. 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, with the exception
of the FHLMC, a majority of its board of directors is not selected by such
governmental unit.
"Person": Any individual, corporation, partnership, joint venture, bank,
joint stock company, trust (including any beneficiary thereof), unincorporated
organization or government or any agency or political subdivision thereof.
"Transfer": Any direct or indirect transfer or sale of any Ownership
Interest in a Certificate, including the acquisition of a Certificate by the
Depositor.
"Transferee": Any Person who is acquiring by Transfer any Ownership
Interest in a Certificate.
"United States Person or U.S. Person": Shall mean (i) a citizen or
resident of the United States; (ii) a corporation (or entity treated as a
corporation for tax purposes) created or organized in the United States or
under the laws of the United States or of any state thereof, including, for
this purpose, the District of Columbia; (iii) a partnership (or entity treated
as a partnership for tax purposes) organized in the United States or under the
laws of the United States or of any state thereof, including, for this
purpose, the District of Columbia (unless provided otherwise by future
Treasury regulations); (iv) an estate whose income is includible in gross
income for United States income tax purposes regardless of its source; or (v)
a trust, if a court within the United States is able to exercise primary
supervision over the administration of the trust and one or more U.S. Persons
have authority to control all substantial decisions of the trust.
Notwithstanding the last clause of the preceding sentence, to the extent
provided in Treasury regulations, certain trusts in existence on August 20,
1996, and treated as U.S. Persons prior to such date, may elect to continue to
be U.S. Persons.
<PAGE>
EXHIBIT 2
to EXHIBIT I
Section 5.02 (c) of the Agreement
(c) Each Person who has or who acquires any Ownership Interest in the
Residual Certificates shall be deemed by the acceptance or acquisition of such
Ownership Interest to have agreed to be bound by the following provisions, and
the rights of each Person acquiring any Ownership Interest in a Residual
Certificate are expressly subject to the following provisions:
(i) Each Person holding or acquiring any Ownership Interest in the
Residual Certificates shall be a Permitted Transferee and shall promptly
notify the Trustee of any change or impending change in its status as a
Permitted Transferee.
(ii) No Ownership Interest in the Residual Certificates may be
registered on the Closing Date or thereafter transferred, and the Trustee
shall not register the Transfer of any Residual Certificates unless, in
addition to the certificates required to be delivered to the Trustee
under subparagraph (b) above, the Trustee shall have been furnished with
an affidavit (a "Transfer Affidavit") of the initial owner or the
proposed transferee in the form attached hereto as Exhibit I.
(iii) Each Person holding or acquiring any Ownership Interest in a
Residual Certificate shall agree (A) to obtain a Transfer Affidavit from
any other Person to whom such Person attempts to Transfer its Ownership
Interest in a Residual Certificate, (B) to obtain a Transfer Affidavit
from any Person for whom such Person is acting as nominee, trustee or
agent in connection with any Transfer of a Residual Certificate and (C)
not to Transfer its Ownership Interest in a Residual Certificate or to
cause the Transfer of an Ownership Interest in a Residual Certificate to
any other Person if it has actual knowledge that such Person is not a
Permitted Transferee.
(iv) Any attempted or purported Transfer of any Ownership Interest
in a Residual Certificate in violation of the provisions of this Section
5.02(c) shall be absolutely null and void and shall vest no rights in the
purported Transferee. If any purported transferee shall become a Holder
of a Residual Certificate in violation of the provisions of this Section
5.02(c), then the last preceding Permitted Transferee shall be restored
to all rights as Holder thereof retroactive to the date of registration
of Transfer of such Residual Certificate. The Trustee shall be under no
liability to any Person for any registration of Transfer of a Residual
Certificate that is in fact not permitted by Section 5.02(b) and this
Section 5.02(c) or for making any payments due on such Certificate to the
Holder thereof or taking any other action with respect to such Holder
under the provisions of this Agreement so long as the Transfer was
registered after receipt of the related Transfer Affidavit, Transferor
Certificate and either the Rule 144A Letter or the Investment Letter. The
Trustee shall be entitled but not obligated to recover from any Holder of
a Residual Certificate that was in fact not a Permitted Transferee at the
time it became a Holder or, at such subsequent time as it became other
than a Permitted Transferee, all payments made on such Residual
Certificate at and after either such time. Any such payments so recovered
by the Trustee shall be paid and delivered by the Trustee to the last
preceding Permitted Transferee of such Certificate.
(v) The Depositor shall use its best efforts to make available, upon
receipt of written request from the Trustee, all information necessary to
compute any tax imposed under Section 860E(e) of the Code as a result of
a Transfer of an Ownership Interest in a Residual Certificate to any
Holder who is not a Permitted Transferee.
<PAGE>
EXHIBIT J
FORM OF TRANSFEROR CERTIFICATE
__________, 20__
IndyMac ABS, Inc.
_________________
_________________
_________________
The Bank of New York
101 Barclay Street, 12W
New York, NY 10286
Attention: Mortgage-Backed
Securities Group Series 200[ ]-
Re: IndyMac ABS, Inc. Home Equity Loan Asset-
Backed Trust, Series SPMD 2000-A, Home Equity Mortgage Loan Asset-Backed
Certificates, Series SPMD 2000-A, Class ___
Ladies and Gentlemen:
In connection with our disposition of the above Certificates we
certify that (a) we understand that the Certificates have not been
registered under the Securities Act of 1933, as amended (the "Act"), and are
being disposed by us in a transaction that is exempt from the registration
requirements of the Act, (b) we have not offered or sold any Certificates to,
or solicited offers to buy any Certificates from, any person, or otherwise
approached or negotiated with any person with respect thereto, in a manner
that would be deemed, or taken any other action which would result in, a
violation of Section 5 of the Act and (c) to the extent we are disposing of a
Residual Certificate, we have no knowledge the Transferee is not a Permitted
Transferee.
Very truly yours,
___________________________________________
Print Name of Transferor
By:________________________________________
Authorized Officer
<PAGE>
EXHIBIT L
FORM OF RULE 144A LETTER
____________, 20__
IndyMac ABS, Inc.
__________________
__________________
__________________
The Bank of New York
101 Barclay Street, 12W
New York, NY 10286
Attention: Mortgage-Backed
Securities Group Series 200[ ]-
Re: Home Equity Mortgage Loan Asset-Backed Trust, Series SPMD 2000-A
Home Equity Mortgage Loan Asset-Backed Certificates, Series SPMD
2000-A, Class
----------------------------------------------------------------
Ladies and Gentlemen:
In connection with our acquisition of the above Certificates we
certify that (a) we understand that the Certificates are not being registered
under the Securities Act of 1933, as amended (the "Act"), or any state
securities laws and are being transferred to us in a transaction that is
exempt from the registration requirements of the Act and any such laws, (b) we
have such knowledge and experience in financial and business matters that we
are capable of evaluating the merits and risks of investments in the
Certificates, (c) we have had the opportunity to ask questions of and receive
answers from the Depositor concerning the purchase of the Certificates and all
matters relating thereto or any additional information deemed necessary to our
decision to purchase the Certificates, (d) we are not an employee benefit plan
that is subject to the Employee Retirement Income Security Act of 1974, as
amended, or a plan or arrangement that is subject to Section 4975 of the
Internal Revenue Code of 1986, as amended, nor are we acting on behalf of any
such plan or arrangement nor using the assets of any such plan or arrangement
to effect such acquisition, (e) we have not, nor has anyone acting on our
behalf offered, transferred, pledged, sold or otherwise disposed of the
Certificates, any interest in the Certificates or any other similar security
to, or solicited any offer to buy or accept a transfer, pledge or other
disposition of the Certificates, any interest in the Certificates or any other
similar security from, or otherwise approached or negotiated with respect to
the Certificates, any interest in the Certificates or any other similar
security with, any person in any manner, or made any general solicitation by
means of general advertising or in any other manner, or taken any other
action, that would constitute a distribution of the Certificates under the
Securities Act or that would render the disposition of the Certificates a
violation of Section 5 of the Securities Act or require registration pursuant
thereto, nor will act, nor has authorized or will authorize any person to act,
in such manner with respect to the Certificates, (f) to the extent that the
Certificate transferred is a Class X Certificate, we are a bankruptcy-remote
entity and (g) 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.
<PAGE>
ANNEX 1 TO EXHIBIT L
--------------------
QUALIFIED INSTITUTIONAL BUYER STATUS UNDER SEC RULE 144A
--------------------------------------------------------
[For Transferees Other Than Registered Investment Companies]
The undersigned (the "Buyer") hereby certifies as follows to the
parties listed in the Rule 144A Transferee Certificate to which this
certification relates with respect to the Certificates described therein:
1. As indicated below, the undersigned is the President, Chief
Financial Officer, Senior Vice President or other executive officer of the
Buyer.
2. In connection with purchases by the Buyer, the Buyer is a
"qualified institutional buyer" as that term is defined in Rule 144A under the
Securities Act of 1933, as amended ("Rule 144A") because (i) the Buyer owned
and/or invested on a discretionary basis $ _________ 1 in securities (except
for the excluded securities referred to below) as of the end of the Buyer's
most recent fiscal year (such amount being calculated in accordance with Rule
144A and (ii) the Buyer satisfies the criteria in the category marked below.
-- Corporation, etc. The Buyer is a corporation (other than a bank,
savings and loan association or similar institution),
Massachusetts or similar business trust, partnership, or
charitable organization described in Section 501(c)(3) of the
Internal Revenue Code of 1986, as amended.
-- Bank. The Buyer (a) is a national bank or banking institution
organized under the laws of any State, territory or the District
of Columbia, the business of which is substantially confined to
banking and is supervised by the State or territorial banking
commission or similar official or is a foreign bank or
equivalent institution, and (b) has an audited net worth of at
least $25,000,000 as demonstrated in its latest annual financial
statements, a copy of which is attached hereto.
-- Savings and Loan. The Buyer (a) is a savings and loan
association, building and loan association, cooperative bank,
homestead association or similar institution, which is
supervised and examined by a State or Federal authority having
supervision over any such institutions or is a foreign savings
and loan association or equivalent institution and (b) has an
audited net worth of at least $25,000,000 as demonstrated in its
latest annual financial statements, a copy of which is attached
hereto.
-----------------
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.
<PAGE>
-- Broker-dealer. The Buyer is a dealer registered pursuant to
Section 15 of the Securities Exchange Act of 1934.
-- Insurance Company. The Buyer is an insurance company whose
primary and predominant business activity is the writing of
insurance or the reinsuring of risks underwritten by insurance
companies and which is subject to supervision by the insurance
commissioner or a similar official or agency of a State,
territory or the District of Columbia.
-- State or Local Plan. The Buyer is a plan established and
maintained by a State, its political subdivisions, or any agency
or instrumentality of the State or its political subdivisions,
for the benefit of its employees.
-- ERISA Plan. The Buyer is an employee benefit plan within the
meaning of Title I of the Employee Retirement Income Security
Act of 1974.
-- Investment Advisor. The Buyer is an investment advisor
registered under the Investment Advisors Act of 1940.
-- Small Business Investment Company. Buyer is a small business
investment company licensed by the U.S. Small Business
Administration under Section 301(c) or (d) of the Small Business
Investment Act of 1958.
-- Business Development Company. Buyer is a business development
company as defined in Section 202(a)(22) of the Investment
Advisors Act of 1940.
3. The term "securities" as used herein does not include (i)
securities of issuers that are affiliated with the Buyer, (ii) securities that
are part of an unsold allotment to or subscription by the Buyer, if the Buyer
is a dealer, (iii) securities issued or guaranteed by the U.S. or any
instrumentality thereof, (iv) bank deposit notes and certificates of deposit,
(v) loan participations, (vi) repurchase agreements, (vii) securities owned
but subject to a repurchase agreement and (viii) currency, interest rate and
commodity swaps.
4. For purposes of determining the aggregate amount of securities
owned and/or invested on a discretionary basis by the Buyer, the Buyer used
the cost of such securities to the Buyer and did not include any of the
securities referred to in the preceding paragraph, except (i) where the Buyer
reports its securities holdings in its financial statements on the basis of
their market value, and (ii) no current information with respect to the cost
of those securities has been published. If clause (ii) in the preceding
sentence applies, the securities may be valued at market. Further, in
determining such aggregate amount, the Buyer may have included securities
owned by subsidiaries of the Buyer, but only if such subsidiaries are
consolidated with the Buyer in its financial statements prepared in accordance
with generally accepted accounting principles and if the investments of such
subsidiaries are managed under the Buyer's direction. However, such securities
were not included if the Buyer is a majority-owned, consolidated subsidiary of
another enterprise and the Buyer is not itself a reporting company under the
Securities Exchange Act of 1934, as amended.
5. The Buyer acknowledges that it is familiar with Rule 144A and
understands that the seller to it and other parties related to the
Certificates are relying and will continue to rely on the statements made
herein because one or more sales to the Buyer may be in reliance on Rule 144A.
6. Until the date of purchase of the Rule 144A Securities, the Buyer
will notify each of the parties to which this certification is made of any
changes in the information and conclusions herein. Until such notice is given,
the Buyer's purchase of the Certificates will constitute a reaffirmation of
this certification as of the date of such purchase. In addition, if the Buyer
is a bank or savings and loan is provided above, the Buyer agrees that it will
furnish to such parties updated annual financial statements promptly after
they become available.
_________________________________________
Print Name of Transferor
By:______________________________________
Name:
Title:
Date:____________________________________
<PAGE>
ANNEX 2 TO EXHIBIT L
--------------------
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 M
REQUEST FOR RELEASE
(for Trustee)
IndyMac ABS, Inc.,
Home Equity Mortgage Loan Asset-Backed Trust, Series SPMD 2000-A
Home Equity Mortgage Loan Asset-Backed Certificates,
Series SPMD 2000-A
Loan Information
----------------
Name of Mortgagor _________________________________
Servicer
Loan No.: _________________________________
Trustee
-------
Name: _________________________________
Address: _________________________________
_________________________________
_________________________________
Trustee
Mortgage File No.: _________________________________
The undersigned Master Servicer hereby acknowledges that it has received
from The Bank of New York, as Trustee for the Holders of Home Equity Mortgage
Loan Asset-Backed Certificates, of the above-referenced Series, the documents
referred to below (the "Documents"). All capitalized terms not otherwise
defined in this Request for Release shall have the meanings given them in the
Pooling and Servicing Agreement (the "Pooling and Servicing Agreement")
relating to the above-referenced Series among the Trustee, IndyMac, Inc., as
Seller and Master Servicer and IndyMac ABS, Inc., as Depositor.
( ) Mortgage Note dated ____________, ______, in the original principal sum
of $__________, made by ___________________________, payable to, or
endorsed to the order of, the Trustee.
( ) Mortgage recorded on _________________ as instrument no. ______________
in the County Recorder's Office of the County of ___________________,
State of _______________ in book/reel/docket __________ of official
records at page/image _______________ .
( ) Deed of Trust recorded on ___________________ as instrument no. ________
in the County Recorder's Office of the County of ________________, State
of _______________ in book/reel/docket __________ of official records at
page/image _______.
( ) Assignment of Mortgage or Deed of Trust to the Trustee, recorded on
________________ as instrument no. _______ in the County Recorder's
Office of the County of __________, State of ________________ in
book/reel/docket __________ of official records at page/image _____.
( ) Other documents, including any amendments, assignments or other
assumptions of the Mortgage Note or Mortgage.
( )
------------------------------------------------------------------
( )
------------------------------------------------------------------
( )
------------------------------------------------------------------
( )
------------------------------------------------------------------
The undersigned Master Servicer hereby acknowledges and agrees as
follows:
(1) The Master Servicer shall hold and retain possession of the
Documents in trust for the benefit of the Trustee, solely for the
purposes provided in the Agreement.
(2) The Master Servicer shall not cause or knowingly permit the
Documents to become subject to, or encumbered by, any claim, liens,
security interest, charges, writs of attachment or other impositions nor
shall the Servicer assert or seek to assert any claims or rights of
setoff to or against the Documents or any proceeds thereof.
(3) The Master Servicer shall return each and every Document
previously requested from the Mortgage File to the Trustee when the need
therefor no longer exists, unless the Mortgage Loan relating to the
Documents has been liquidated and the proceeds thereof have been remitted
to the Certificate Account and except as expressly provided in the
Agreement.
<PAGE>
(4) The Documents and any proceeds thereof, including any proceeds
of proceeds, coming into the possession or control of the Master Servicer
shall at all times be earmarked for the account of the Trustee, and the
Master Servicer shall keep the Documents and any proceeds separate and
distinct from all other property in the Master Servicer's possession,
custody or control.
INDYMAC, INC.
By:
--------------------------------------
Its
--------------------------------------
Date:
--------------------------
<PAGE>
EXHIBIT N
REQUEST FOR RELEASE OF DOCUMENTS
To: The Bank of New York Attn: Mortgage Custody Services
Re: The Pooling & Servicing Agreement dated _______ among IndyMac, Inc., as
Master Servicer, Inc, IndyMac ABS, Inc. and The Bank of New York as
Trustee
Ladies and Gentlemen:
In connection with the administration of the Mortgage Loans held by you as
Trustee for IndyMac ABS, Inc., we request the release of the Mortgage Loan
File for the Mortgage Loan(s) described below, for the reason indicated.
FT Account#: Pool #:
Mortgagor's Name, Address and Zip Code:
--------------------------------------
Mortgage Loan Number:
--------------------
Reason for Requesting Documents (check one)
-------------------------------
_______1. Mortgage Loan paid in full (IndyMac hereby certifies that all
amounts have been received.)
_______2. Mortgage Loan Liquidated (IndyMac hereby certifies that all
proceeds of foreclosure, insurance, or other liquidation
have been finally received.)
_______3. Mortgage Loan in Foreclosure.
_______4. Other (explain): ____________________________________
If item 1 or 2 above is checked, and if all or part of the Mortgage File was
previously released to us, please release to us our previous receipt on file
with you, as well as an additional documents in your possession relating to
the above-specified Mortgage Loan. If item 3 or 4 is checked, upon return of
all of the above documents to you as Trustee, please acknowledge your receipt
by signing in the space indicated below, and returning this form.
<PAGE>
INDYMAC, INC. 155 North Lake Ave.
Pasadena CA 91101
By:__________________________________
Name:________________________________
Title:_______________________________
Date:________________________________
TRUSTEE CONSENT TO RELEASE AND
ACKNOWLEDGEMENT OF RECEIPT
By:__________________________________
Name:________________________________
Title:_______________________________
Date:________________________________
<PAGE>
EXHIBIT O
[RESERVED]
<PAGE>
EXHIBIT Q
FORM OF SUBSEQUENT TRANSFER AGREEMENT
Subsequent Transfer Agreement, dated as of May [ ], 2000, among
IndyMac ABS, Inc., a Delaware corporation, as depositor (the "Depositor"),
IndyMac, Inc., a Delaware corporation ("IndyMac"), in its capacity as seller
under the Pooling and Servicing Agreement referred to below (the "Seller"),
and The Bank of New York, as trustee (the "Trustee").
WITNESSETH:
WHEREAS, the Depositor, IndyMac (in its capacity as Seller and in
its capacity as Master Servicer) and the Trustee are parties to that certain
pooling and servicing agreement dated as of April 1, 2000 (the "Pooling and
Servicing Agreement") relating to the Home Equity Mortgage Loan Asset-Backed
Certificates, Series SPMD 2000-A; and
WHEREAS, as contemplated in the Pooling and Servicing Agreement, the
Seller desires to convey certain Subsequent Mortgage Loans (as hereinafter
defined) to the Depositor, and the Depositor desires to simultaneously convey
such Subsequent Mortgage Loans to the Trustee for the benefit of the
Certificateholders;
NOW, THEREFORE, the parties hereto hereby agree as follows:
Section 1.01. Defined Terms.
-------------
Capitalized terms used herein that are not otherwise defined shall have
the meanings ascribed thereto in Pooling and Servicing Agreement.
"Agreement" means this Subsequent Transfer Agreement and all amendments
hereof and supplements hereto.
"Subsequent Mortgage Loans" means the Mortgage Loans identified on the
Mortgage Loan Schedule specified in Section 1.02 hereof.
"Subsequent Transfer Date" means, with respect to this Agreement, May [ ],
2000.
"Cut-off Date" means, with respect to each of the Subsequent Mortgage
Loans, May 1, 2000.
Section 1.02. Mortgage Loan Schedule.
-----------------------
Annexed hereto is a supplement to Schedule I to the Pooling and Servicing
Agreement listing the Subsequent Mortgage Loans to be conveyed by the Seller
to the Depositor and simultaneously by the Depositor to the Trustee pursuant
to the Pooling and Servicing Agreement and this Agreement on the Subsequent
Transfer Date.
Section 1.03. Conveyance of Subsequent Mortgage Loans by the Seller.
-----------------------------------------------------
Subject to the conditions set forth in Section 1.05 and Section 1.06, in
consideration of the Trustee's delivery to or upon the order of the Seller of
an amount equal to $________ (i.e., the aggregate Cut-off Date Principal
Balance of the Subsequent Mortgage Loans), the Seller does hereby sell,
transfer, assign and otherwise convey to the Depositor, without recourse
(subject to the Seller's obligations hereunder) all of the Seller's right,
title and interest in and to the Subsequent Mortgage Loans, including all
interest and principal received or receivable by the Seller on or with respect
to each Subsequent Mortgage Loan after the related Cut-off Date and all
interest and principal payments on each Subsequent Mortgage Loan received
prior to such related Cut-off Date in respect of installments of interest and
principal due thereafter, but not including payments of principal and interest
due and payable on each Subsequent Mortgage Loan on or before such related
Cut-off Date, and the Depositor simultaneously does hereby sell, transfer,
assign, set over and otherwise convey to the Trustee for the benefit of the
Certificateholders, without recourse, all the right, title and interest of the
Depositor in and to each Subsequent Mortgage Loan, including all interest and
principal received or receivable by the Depositor on or with respect to each
Subsequent Mortgage Loan after the related Cut-off Date and all interest and
principal payments on each Subsequent Mortgage Loan received prior to such
related Cut-off Date in respect of installments of interest and principal due
thereafter, but not including payments of principal and interest due and
payable on each Subsequent Mortgage Loan on or before such related Cut-off
Date.
Section 1.04. Allocation of the Amounts to be Released from the Pre-Funding
Accounts.
Of the $________ (i.e., the aggregate Cut-off Date Principal Balance of
the Subsequent Mortgage Loans), released by the Trustee pursuant to the terms
of Section 1.03 hereof, the Trustee shall release an amount equal to
$__________ (i.e., the aggregate Cut-off Date Principal Balance of the
Subsequent Mortgage Loans transferred to Loan Group 1 pursuant to this
Agreement) from the Group 1 Pre-Funding Account.
Of the $________ (i.e., the aggregate Cut-off Date Principal Balance of
the Subsequent Mortgage Loans), released by the Trustee pursuant to the terms
of Section 1.03 hereof, the Trustee shall release an amount equal to
$__________ (i.e., the aggregate Cut-off Date Principal Balance of the
Subsequent Mortgage Loans transferred to Loan Group 2 pursuant to this
Agreement) from the Group 2 Pre-Funding Account.
Section 1.05. Representations and Warranties of Seller.
----------------------------------------
The Seller does hereby reaffirm the representations and warranties set
forth in Section 2.03 and on Schedule II of the Pooling and Servicing
Agreement for the benefit of the Depositor and the Trustee as purchasers
hereunder are true with respect to the Subsequent Mortgage Loans. Such
representations and warranties shall survive the sale, transfer and assignment
of the Subsequent Mortgage Loans to the Depositor and the simultaneous sale,
transfer and assignment of such Subsequent Mortgage Loans to the Trustee.
Section 1.06. Representations and Warranties of Depositor.
-------------------------------------------
The Depositor does hereby reaffirm the representations and warranties set
forth in Section 2.04 of the Pooling and Servicing Agreement for the benefit
of the Trustee as purchaser hereunder are true with respect to the Subsequent
Mortgage Loans. Such representations and warranties shall survive the sale,
transfer and assignment of the Subsequent Mortgage Loans to the Trustee.
Section 1.07. Conditions Precedent.
--------------------
The obligation of the Trustee to acquire the Subsequent Mortgage Loans
hereunder is subject to the satisfaction, on or prior to the Subsequent
Transfer Date, of the conditions precedent identified in Section 2.09(b).
The Trustee shall not be required to investigate or otherwise verify
satisfaction of the conditions listed above, but shall be entitled to
conclusively rely upon Opinions of Counsel and Officer's Certificates
confirming such fulfillment.
Section 1.08. Reaffirmation of Agreement.
--------------------------
All terms, conditions and provisions of the Pooling and Servicing
Agreement are hereby reaffirmed and incorporated by reference by the Seller as
to the Subsequent Mortgage Loans.
Section 1.09. Governing Law.
-------------
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
under this Agreement shall be determined in accordance with such laws;
provided, however, the immunities, authority and standard of care of the
Trustee shall be governed by the jurisdiction in which its Corporate Trust
Office is located.
<PAGE>
IN WITNESS WHEREOF, the Seller and the Trustee have caused this Agreement
to be duly executed and delivered by their respective duly authorized officers
as of the day and the year first above written.
INDYMAC, INC.,
as Seller
By:____________________________________
Name:
Title:
THE BANK OF NEW YORK,
not in its individual capacity,
but solely as Trustee
By:____________________________________
Name:
Title:
<PAGE>
[SUPPLEMENT TO MORTGAGE LOAN SCHEDULE]
