<PAGE>
================================================================================
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 8-K
CURRENT REPORT PURSUANT
TO SECTION 13 OR 15(d) OF THE
SECURITIES EXCHANGE ACT OF 1934
Date of Report (Date of Earliest Event Reported) July 27, 1999
----------------------
ABN AMRO MORTGAGE CORPORATION (as depositor under the Pooling and
Servicing Agreement, dated as of July 1, 1999 providing for, inter alia, the
issuance of ABN AMRO Mortgage Corporation Mortgage Resecuritization Pass-Through
Certificates Series 1999-RS1)
ABN AMRO Mortgage Corporation
- --------------------------------------------------------------------------------
(Exact Name of Registrant as Specified in its Charter)
Delaware
- --------------------------------------------------------------------------------
(State or Other Jurisdiction of Incorporation)
333-57027 363886007
- ------------------------------------ --------------------------------------
(Commission File Number) (I.R.S. Employer Identification No.)
181 West Madison Street
Chicago, Illinois 60602
- --------------------------------------------------------------------------------
(Address of Principal Executive Offices) (Zip Code)
248-643-2530
- --------------------------------------------------------------------------------
(Registrant's Telephone Number, Including Area Code)
Not Applicable
- --------------------------------------------------------------------------------
(Former Name or Former Address, if Changed Since Last Report)
================================================================================
<PAGE>
ITEM 2. ACQUISITION OR DISPOSITION OF ASSETS.
Description of the Certificates and the Mortgage Pool.
On July 30, 1999, a single series of certificates, entitled ABN AMRO
Mortgage Corporation, Resecuritization Pass-Through Certificates, Series
1999-RS1 (the "Certificates"), was issued pursuant to a Pooling Agreement (the
"Pooling and Servicing Agreement") attached hereto as Exhibit 4.1 dated as of
July 1, 1999, among ABN AMRO Mortgage Corporation as depositor (the
"Depositor"), and The First National Bank of Chicago as trustee. The
Certificates consist of five classes identified as the "Class A Certificates",
"Class B-1 Certificates", the "Class B-2 Certificates", the "Class B-3
Certificates", and the "Class R Certificate", respectively, and were issued in
exchange for, and evidence the entire beneficial ownership interest in, the
assets of a trust fund (the "Trust Fund") consisting primarily of a pool of
securities representing interests in underlying mortgage loans (the "Pooled
Securities"), having as of the close of business on July 25, 1999 (the "Cut-off
Date"), an aggregate principal balance of approximately $47,753,042 (the
"Initial Pool Balance"), after taking into account all payments of principal due
on the Pooled Securities on or before such date, whether or not received. The
Depositor acquired certain of the Trust Fund assets from Donaldson, Lufkin &
Jenrette Securities Corporation ("DLJ") pursuant to a Pooled Securities Purchase
Agreement (the "Purchase Agreement") dated July 1, 1999, attached hereto as
Exhibit 4.2, between DLJ as seller and the Depositor as purchaser. The Class A,
Class B-1, Class B-2, Class B-3 and Class R Certificates were publicly offered,
as described in a Prospectus, dated July 27, 1999, and a Prospectus Supplement,
dated July 27, 1999, pursuant to an Underwriting Agreement (the "Underwriting
Agreement") dated July 27, 1998, attached hereto as Exhibit 1.1, among the
Depositor, ABN AMRO North America, Inc. ("AANA"), DLJ and ABN AMRO Incorporated
("AAI") (DLJ and AAI being referred to herein, collectively, as the
"Underwriters") and the Terms Agreement (the "Terms Agreement") dated July 27,
1999, attached hereto as Exhibit 1.2, among the Depositor, AANA and the
Underwriters.
Each Class of Certificates will have an initial certificate principal
balance ("Certificate Principal Balance"). The Class A Certificates have an
initial Certificate Principal Balance of $22,802,942. The Class B-1 Certificates
have an initial Certificate Principal Balance of $10,960,000. The Class B-2
Certificates have an initial Certificate Principal Balance of $8,214,000. The
Class B-3 Certificates have an initial Certificate Principal Balance of
$5,776,000. The Class R Certificate has an initial Certificate Principal Balance
of $100.
Capitalized terms used herein and not otherwise defined shall have the meanings
assigned to them in the Pooling and Agreement.
ITEM 7. FINANCIAL STATEMENTS AND EXHIBITS.
(a) Not applicable
(b) Not applicable
(c) Exhibits
<TABLE>
<CAPTION>
EXHIBIT
NO. DOCUMENT DESCRIPTION
- ------- --------------------
<S> <C>
1.1 Underwriting Agreement, dated as of July 27, 1999, among ABN
AMRO Mortgage Corporation, ABN AMRO North America, Inc., ABN
AMRO Incorporated and Donaldson, Lufkin & Jenrette Securities
Corporation.
</TABLE>
2
<PAGE>
<TABLE>
<S> <C>
1.2 Terms Agreement, dated July 27, 1999, among ABN AMRO Mortgage
Corporation, ABN AMRO North America, Inc., ABN AMRO
Incorporated and Donaldson, Lufkin & Jenrette Securities
Corporation.
4.1 Pooling Agreement, dated as of July 1, 1999, among ABN AMRO
Mortgage Corporation, as depositor, and The First National
Bank of Chicago, as trustee.
4.2 Pooled Securities Purchase Agreement, dated as of July 1,
1999, between Donaldson, Lufkin & Jenrette Securities
Corporation, as seller and ABN AMRO Mortgage Corporation, as
purchaser.
</TABLE>
3
<PAGE>
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934,
the registrant has duly caused this report to be signed on its behalf by the
undersigned hereunto duly authorized.
ABN AMRO MORTGAGE CORPORATION
(Registrant)
Dated: August 13, 1999 By: /s/ Maria Fregosi
----------------------------------
Name: Maria Fregosi
Title: Vice-President
<PAGE>
INDEX TO EXHIBITS
<TABLE>
<CAPTION>
EXHIBIT
NO. DOCUMENT DESCRIPTION
- ------- --------------------
<S> <C>
1.1 Underwriting Agreement, dated as of July 27, 1999, among ABN
AMRO Mortgage Corporation, ABN AMRO North America, Inc., ABN
AMRO Incorporated and Donaldson, Lufkin & Jenrette Securities
Corporation.
1.2 Terms Agreement, dated July 27, 1999, among ABN AMRO Mortgage
Corporation, ABN AMRO North America, Inc., ABN AMRO
Incorporated and Donaldson, Lufkin & Jenrette Securities
Corporation.
4.1 Pooling Agreement, dated as of July 1, 1999, among ABN AMRO
Mortgage Corporation, as depositor, and The First National
Bank of Chicago, as trustee.
4.2 Purchase Agreement, dated as of July 1, 1999, between
Donaldson, Lufkin & Jenrette Securities Corporation as seller
and ABN AMRO Mortgage Corporation as purchaser.
</TABLE>
STATEMENT OF DIFFERENCES
------------------------
The section symbol shall be expressed as............................... 'SS'
The dagger symbol shall be expressed as................................ 'D'
<PAGE>
EXHIBIT 1.1
Execution Copy
ABN AMRO MORTGAGE CORPORATION,
RESECURITIZATION PASS-THROUGH CERTIFICATES,
SERIES 1999-RS1
UNDERWRITING AGREEMENT
----------------------
July 27, 1999
Donaldson, Lufkin & Jenrette
Securities Corporation
277 Park Avenue, 9th Floor
New York, New York 10172
ABN AMRO Incorporated
181 West Madison Street
Chicago, Illinois 60602
Ladies and Gentlemen:
ABN AMRO Mortgage Corporation (the "Company"), a Delaware corporation,
has authorized the issuance and sale of Mortgage Pass-Through Certificates (the
"Certificates") evidencing interests in pools of mortgage pass-through
certificates (the "Underlying Certificates"). The Certificates may be issued in
various series, and, within each series, in one or more classes, and, within
each class, in one or more sub-classes, in one or more offerings on terms
determined at the time of sale (each such series, a "Series" and each such
class, a "Class"). Each Series of the Certificates will be issued under a
separate Pooling Agreement (each, a "Pooling Agreement") with respect to such
Series among the Company, as depositor and a trustee to be identified in the
prospectus supplement for each such Series (the "Trustee"). The Certificates of
each Series will evidence specified interests in separate pools of Underlying
Certificates (each a "Pool"), and certain other property held in trust with
respect to such Series (each, a "Trust Fund"). The Underlying Certificates
relating to each Series will be conveyed to the Company under a separate Pooled
Securities Purchase Agreement (each, a "Securities Purchase Agreement").
-1-
<PAGE>
The Certificates are more fully described in a Registration Statement
which the Company has furnished to you. Capitalized terms used but not defined
herein shall have the meanings given to them in the Pooling Agreement. The term
"you" as used herein, unless the context otherwise requires, shall mean you and
such persons as are named as co-managers in the applicable Terms Agreement
(defined below).
Whenever the Company determines to make an offering of Certificates
pursuant to this Agreement through you or through an underwriting syndicate
managed by you it will enter into an agreement (the "Terms Agreement") providing
for the sale of such Certificates to, and the purchase and offering thereof by,
you and such other underwriters, if any, selected by you as have authorized you
to enter into such Terms Agreement on their behalf (the "Underwriters," which
term shall include you whether acting alone in the sale of Certificates or as a
member of an underwriting syndicate; as the context requires, Donaldson, Lufkin
& Jenrette Securities Corporation is sometimes referred to individually herein
as "DLJ" and ABN AMRO Incorporated is sometimes referred to individually herein
as "AAI"). The Terms Agreement relating to each offering of Certificates shall
specify, among other things, the stated balance or balances of Certificates to
be issued, the price or prices at which the Certificates are to be purchased by
the Underwriters from the Company and the initial public offering price or
prices or the method by which the price or prices at which such Certificates are
to be sold will be determined. A Terms Agreement, which shall be substantially
in the form of Exhibit A hereto, may take the form of an exchange of any
standard form of written telecommunication between you and the Company. Each
such offering of Certificates which the Company elects to make pursuant to this
Agreement will be governed by this Agreement, as supplemented by the applicable
Terms Agreement, and this Agreement and such Terms Agreement shall inure to the
benefit of and be binding upon the Underwriters participating in the offering of
such Certificates.
SECTION 1. Representations and Warranties. (a) The Company represents
and warrants to you as of the date hereof, and to the Underwriters named in the
applicable Terms Agreement, all as of the date of such Terms Agreement (in each
case, the "Representation Date"), as follows (any representations and warranties
so made to the Underwriters named in an applicable Terms Agreement respecting
the Certificates being deemed to relate only to the Certificates described
therein):
(1) The Company has filed with the Securities and Exchange
Commission (the "Commission") a registration statement on Form S-3 (No.
333-57027), relating to the offering of Certificates from time to time
in accordance with Rule 415 under the Securities Act of 1933, as
amended (the "1933 Act"), and has filed, and proposes to file, such
amendments thereto as may have been required to the date hereof and the
same has become effective under the 1933 Act and the rules of the
Commission thereunder (the "Regulations") and no stop order suspending
the effectiveness of such registration statement has been issued and no
proceedings for that purpose have been initiated or, to
-2-
<PAGE>
the Company's knowledge, threatened, by the Commission. Such
registration statement, including incorporated documents, exhibits and
financial statements, as amended at the time when it became effective
under the 1933 Act, and the prospectus relating to the sale of
Certificates by the Company constituting a part thereof, as from time
to time each is amended or supplemented pursuant to the 1933 Act or
otherwise, are referred to herein as the "Registration Statement" and
the "Prospectus," respectively; provided, however, that a supplement to
the Prospectus contemplated by Section 3(a) hereof (a "Prospectus
Supplement") shall be deemed to have supplemented the Prospectus only
with respect to the offering or offerings of Certificates to which it
relates. Any reference herein to the Registration Statement, a
preliminary prospectus, the Prospectus or the Prospectus Supplement
shall be deemed to refer to and include the documents incorporated by
reference therein pursuant to Item 12 of Form S-3 which were filed
under the Securities Exchange Act of 1934, as amended (the "1934 Act")
on or before the date on which the Registration Statement, as amended,
became effective or the issue date of such preliminary prospectus,
Prospectus, or Prospectus Supplement, as the case may be; and any
reference herein to the terms "amend," "amendment" or supplement with
respect to the Registration Statement, any preliminary prospectus, the
Prospectus or the Prospectus Supplement shall be deemed to refer to and
include the filing of any document under the 1934 Act after the date on
which the Registration Statement became effective or the issue date of
any preliminary prospectus, the Prospectus or the Prospectus
Supplement, as the case may be, deemed to be incorporated therein by
reference. The Registration Statement and Prospectus, at the time the
Registration Statement became effective did, and as of the applicable
Representation Date will, conform in all material respects to the
requirements of the 1933 Act and the Regulations and any further
supplements to the Prospectus will, when they are filed with the
Commission, conform in all respects to the requirements of the 1933 Act
and the Regulations. The Registration Statement, at the time it became
effective did not, and as of the applicable Representation Date and the
applicable Closing Time (as defined in Section 2 hereof) will not,
contain any untrue statement of a material fact or omit to state any
material fact required to be stated therein or necessary to make the
statements therein not misleading. The Prospectus, as amended or
supplemented as of the applicable Representation Date and the
applicable Closing Time (as defined in Section 2 hereof), will not
contain any untrue statement of a material fact or omit to state a
material fact necessary in order to make the statements therein, in the
light of the circumstances under which they were made, not misleading;
provided, however, that the representations and warranties in this
subsection shall not apply to (i) statements in, or omissions from, the
Registration Statement or Prospectus made in reliance upon and in
conformity with information furnished to the Company in writing by the
Underwriters expressly for use in the Registration Statement or
Prospectus or (ii) the DLJ Information (as defined in Section 10
hereof). The conditions to the use by the Company of a registration
statement on Form S-3 under the 1933 Act, as set forth in the General
Instructions to Form S-3, have been satisfied with respect to the
Registration Statement and the Prospectus. There are no contracts or
documents of the
-3-
<PAGE>
Company which are required to be described in the Registration
Statement or Prospectus or filed as exhibits to the Registration
Statement pursuant to the 1933 Act or the Regulations which have not
been so described or filed.
(2) The documents incorporated by reference in the Registration
Statement and the Prospectus (which, for clarification, only includes
documents filed pursuant to registration statement No. 333-57027), when
they became effective or were filed with the Commission, as the case
may be, conformed in all material respects to the requirements of the
1933 Act or the 1934 Act, as applicable, and the rules and regulations
of the Commission thereunder, and none of such documents contained an
untrue statement of a material fact or omitted to state a material fact
required to be stated therein or necessary to make the statements
therein not misleading, and any further document so filed and
incorporated by reference in the Registration Statement and the
Prospectus (which, for clarification, only includes documents filed
pursuant to registration statement No. 333-57027), when such documents
become effective or are filed with the Commission, as the case may be,
will conform in all material respects to the requirements of the 1933
Act or the 1934 Act, as applicable, and the rules and regulations of
the Commission thereunder and will not contain an untrue statement of a
material fact or omit to state a material fact necessary in order to
make the statements therein, in light of the circumstances under which
they were made, not misleading; provided, however, that the
representation or warranty in this subsection shall not apply to (i)
the DLJ Information (as defined in Section 10 hereof) and (ii) the
information contained in or omitted from such documents in reliance
upon and in conformity with written information furnished to the
Company in writing by the Underwriters expressly for use therein.
(3) The Company has been duly incorporated and is validly existing
as a corporation in good standing under the laws of the State of
Delaware with corporate power and authority to enter into and perform
its obligations under this Agreement, the applicable Pooling Agreement,
and with respect to a Series of Certificates, the Certificates and the
applicable Terms Agreement; and the Company is duly qualified or
registered as a foreign corporation to transact business and is in good
standing in each jurisdiction in which the ownership or lease of its
properties or the conduct of its business requires such qualification.
(4) The Company is not in violation of its certificate of
incorporation or by-laws or in default in the performance or observance
of any material obligation, agreement, covenant or condition contained
in any material contract, indenture, mortgage, loan agreement, note,
lease or other material instrument to which it is a party or by which
it or its properties may be bound, which default might result in any
material adverse change in the financial condition, earnings, affairs
or business of the Company or which might materially and adversely
affect the properties or assets thereof or the Company's ability
-4-
<PAGE>
to perform its obligations under the applicable Securities Purchase
Agreement, this Agreement, the applicable Terms Agreement or the
applicable Pooling Agreement.
(5) The execution and delivery by the Company of the applicable
Securities Purchase Agreement, this Agreement, the applicable Terms
Agreement and the applicable Pooling Agreement and the signing of the
Registration Statement by the Company are within the corporate power of
the Company and have been duly authorized by all necessary corporate
action on the part of the Company; and with respect to a Series of
Certificates described in the applicable Terms Agreement, neither the
issuance and sale of the Certificates to the Underwriters, nor the
execution and delivery by the Company of the applicable Securities
Purchase Agreement, this Agreement, such Terms Agreement and the
related Pooling Agreement, nor the consummation by the Company of the
transactions herein or therein contemplated, nor compliance by the
Company with the provisions hereof or thereof, will conflict with or
result in a breach or violation of any of the terms or provisions of,
or constitute a default under, or result in the creation or imposition
of any lien, charge or encumbrance upon any property or assets of the
Company other than as contemplated by a Pooling Agreement, pursuant to
any material indenture, mortgage, contract or other material instrument
to which the Company is a party or by which it is bound or to which the
property or assets of the Company are subject, or result in the
violation of the provisions of the certificate of incorporation or
by-laws of the Company or any statute or any material order, rule or
regulation of any court or governmental agency or body having
jurisdiction over the Company or any of its properties.
(6) This Agreement has been, and each applicable Terms Agreement
when executed and delivered as contemplated hereby and thereby will
have been, duly authorized, executed and delivered by the Company, and
each constitutes, or will constitute when so executed and delivered, a
legal, valid and binding instrument enforceable against the Company in
accordance with its terms (assuming due authorization, execution and
delivery by the other parties thereto), subject (a) to applicable
bankruptcy, insolvency, reorganization, moratorium, or other similar
laws affecting creditors' rights generally, (b) as to enforceability to
general principles of equity (regardless of whether enforcement is
sought in a proceeding in equity or at law) and (c) as to
enforceability with respect to rights of indemnity thereunder, to
limitations of public policy under applicable securities laws.
(7) Each applicable Securities Purchase Agreement and Pooling
Agreement when executed and delivered as contemplated hereby and
thereby will have been duly authorized, executed and delivered by the
Company, and will constitute when so executed and delivered, a legal,
valid and binding instrument enforceable against the Company in
accordance with its terms (assuming due authorization, execution and
delivery by the
-5-
<PAGE>
other parties thereto), subject (a) to applicable bankruptcy,
insolvency, reorganization, moratorium or other similar laws affecting
creditors' rights generally and (b) as to enforceability to general
principles of equity (regardless of whether enforcement is sought in a
proceeding in equity or at law); and as of the Closing Time, the
representations and warranties made by the Company in the applicable
Pooling Agreement will be true and correct as of the date made.
(8) As of the Closing Time (as defined in Section 2 hereof) with
respect to a Series of Certificates, the Certificates will have been
duly and validly authorized by the Company, and, when executed and
authenticated as specified in the related Pooling Agreement, will be
validly issued and outstanding and will be entitled to the benefits of
the related Pooling Agreement, and the Classes of Certificates so
designated in the related Prospectus Supplement, if any, will be
"mortgage related securities," as defined in Section 3(a)(41) of the
1934 Act.
(9) There are no actions, proceedings or investigations now
pending against the Company or, to the knowledge of the Company,
threatened against the Company, before any court, administrative agency
or other tribunal (i) asserting the invalidity of the applicable
Securities Purchase Agreement, this Agreement, the applicable Terms
Agreement, the applicable Pooling Agreement or with respect to a Series
of Certificates, the Certificates, (ii) seeking to prevent the issuance
of such Certificates or the consummation of any of the transactions
contemplated by the applicable Securities Purchase Agreement, this
Agreement, the applicable Terms Agreement or such Pooling Agreement,
(iii) which would be likely to materially and adversely affect the
performance by the Company of its obligations under, or which would if
adversely determined materially and adversely affect the validity or
enforceability of, the applicable Securities Purchase Agreement, this
Agreement, the applicable Terms Agreement, such Pooling Agreement or
such Certificates or (iv) seeking to adversely affect the federal
income tax attributes of such Certificates described in the Prospectus
and the related Prospectus Supplement.
(10) Any material taxes, fees and other governmental charges that
are assessed and due in connection with the execution, delivery and
issuance of the applicable Securities Purchase Agreement, this
Agreement, the applicable Terms Agreement, the applicable Pooling
Agreement and with respect to a Series of Certificates shall have been
paid at or prior to the Closing Time.
(11) No filing or registration with, notice to or consent,
approval, authorization, order or qualification of or with any court or
governmental agency or body is required for the issuance and sale of
the Certificates or the consummation by the Company of the transactions
contemplated by the applicable Securities Purchase Agreement, this
-6-
<PAGE>
Agreement, the applicable Pooling Agreement or the applicable Terms
Agreement, except the registration under the 1933 Act of the
Certificates, and such consents, approvals, authorizations,
registrations or qualifications as may be required under state
securities or Blue Sky laws in connection with the purchase and
distribution of the Certificates by the Underwriters.
(12) The Company possesses all material licenses, certificates,
authorities or permits issued by the appropriate state, federal or
foreign regulatory agencies or bodies deemed by the Company to be
reasonably necessary to conduct the business now operated by it and as
described in the Prospectus and the Company has received no notice of
proceedings relating to the revocation or modification of any such
license, certificate, authority or permit which, singly or in the
aggregate, if the subject of an unfavorable decision, ruling or
finding, would materially and adversely affect the conduct of the
business, operations, financial condition or income of the Company.
(13) No litigation is pending or, to the best of the Company's
knowledge, threatened, against the Company which would prohibit the
Company's entering into the applicable Securities Purchase Agreement,
this Agreement or the applicable Pooling Agreement.
(14) As of the Closing Time, with respect to a Series of
Certificates described in the relevant Terms Agreement evidencing
interests in a Pool, the Company has conveyed all of its right, title
and interest in and to the Underlying Certificate included in the Trust
Fund, free and clear of all prior liens, charges, pledges, mortgages,
security interests and encumbrances of anyone claiming by, through or
under the Company.
(15) As of the Closing Time, with respect to a Series of
Certificates, the Pool will have substantially the characteristics
described in the Prospectus Supplement and in the Form 8-K of the
Company prepared with respect to such Certificates, if the Pool is
described in such Form 8-K.
(16) Neither the Company nor the Trust Fund created by the
applicable Pooling Agreement will be subject to registration as an
"investment company" under the Investment Company Act of 1940, as
amended (the "1940 Act").
(17) The Certificates, the applicable Pooling Agreement, the
applicable Terms Agreement and any credit enhancement related to the
Certificates described in the relevant Terms Agreement conform in all
material respects to the descriptions thereof contained in the
Prospectus.
(18) As of the Closing Time, the Mortgage Loans will have been
duly and validly assigned and delivered by the Company to the Trustee
under the related Pooling Agreement.
-7-
<PAGE>
(19) As of the Closing Time, the representations and warranties of
the Company contained in the applicable Pooling Agreement are true and
correct in all material respects.
(20) The Classes of Certificates indicated in the applicable Terms
Agreement has been duly authorized for listing, subject to official
notice of issuance, on the New York Stock Exchange ("NYSE").
(b) ABN AMRO North America, Inc. ("AANA") represents and warrants to
you as of the date hereof, and to the Underwriters named in the applicable Terms
Agreement, all as of the date of such Terms Agreement (in each case, the
"Representation Date"), as follows (any representations and warranties so made
to the Underwriters named in an applicable Terms Agreement respecting the
Certificates being deemed to relate only to the Certificates described therein):
(1) AANA has been duly incorporated and is validly existing as a
corporation in good standing under the laws of the State of Delaware
with corporate power and authority to enter into and perform its
obligations under this Agreement, and with respect to a Series of
Certificates, the applicable Terms Agreement; and AANA is duly
qualified or registered as a foreign corporation to transact business
and is in good standing in each jurisdiction in which the ownership or
lease of its properties or the conduct of its business requires such
qualification.
(2) AANA is not in violation of its certificate of incorporation
or by-laws or in default in the performance or observance of any
material obligation, agreement, covenant or condition contained in any
material contract, indenture, mortgage, loan agreement, note, lease or
other material instrument to which it is a party or by which it or its
properties may be bound, which default might result in any material
adverse change in the financial condition, earnings, affairs or
business of AANA or which might materially and adversely affect the
properties or assets thereof or AANA's ability to perform its
obligations under this Agreement or the applicable Terms Agreement.
(3) The execution and delivery by AANA of this Agreement and the
applicable Terms Agreement are within the corporate power of AANA and
have been duly authorized by all necessary corporate action on the part
of AANA; and with respect to a Series of Certificates described in the
applicable Terms Agreement, neither the execution and delivery by AANA
of this Agreement and such Terms Agreement, nor the consummation by
AANA of the transactions herein or therein contemplated, nor compliance
by AANA with the provisions hereof or thereof, will conflict with or
result in a breach or violation of any of the terms or provisions of,
or constitute a default under, or result in the creation or imposition
of any lien, charge or encumbrance upon any property or assets of AANA,
pursuant to any material indenture, mortgage, contract or
-8-
<PAGE>
other material instrument to which AANA is a party or by which it
is bound or to which the property or assets of AANA are subject, or
result in the violation of the provisions of the certificate of
incorporation or by-laws of AANA or any statute or any order, rule or
regulation of any court or governmental agency or body having
jurisdiction over AANA or any of its properties.
(4) This Agreement has been, and each applicable Terms Agreement
when executed and delivered as contemplated hereby and thereby will
have been, duly authorized, executed and delivered by AANA, and each
constitutes, or will constitute when so executed and delivered, a
legal, valid and binding instrument enforceable against AANA in
accordance with its terms (assuming due authorization, execution and
delivery by the other parties thereto), subject (a) to applicable
bankruptcy, insolvency, reorganization, moratorium, or other similar
laws affecting creditors' rights generally, (b) as to enforceability to
general principles of equity (regardless of whether enforcement is
sought in a proceeding in equity or at law) and (c) as to
enforceability with respect to rights of indemnity thereunder, to
limitations of public policy under applicable securities laws.
(5) No filing or registration with, notice to or consent,
approval, authorization, order or qualification of or with, any court
or governmental agency or body is required for the consummation by AANA
of the transactions contemplated by this Agreement or the applicable
Terms Agreement, except as already have been obtained.
(6) There are no actions, proceedings or investigations now
pending against AANA or, to the knowledge of AANA, threatened against
AANA, before any court, administrative agency or other tribunal (i)
asserting the invalidity of this Agreement or the applicable Terms
Agreement, (ii) seeking to prevent the issuance of such Certificates or
the consummation of any of the transactions contemplated by this
Agreement or the applicable Terms Agreement, (iii) which would be
likely to materially and adversely affect the performance by AANA of
its obligations under, or which would if adversely determined
materially and adversely affect the validity or enforceability of, this
Agreement, the applicable Terms Agreement, or such Certificates or (iv)
seeking to adversely affect the federal income tax attributes of such
Certificates described in the Prospectus and the related Prospectus
Supplement.
SECTION 2. Purchase and Sale. The commitment of each Underwriter to
purchase Certificates pursuant to any Terms Agreement shall be several and not
joint and shall be deemed to have been made on the basis of the representations
and warranties herein contained and shall be subject to the terms and conditions
herein set forth.
Payment of the purchase price for, and delivery of, any Certificates to
be purchased by the Underwriters shall be made at the offices of Mayer, Brown &
Platt, 190 South La Salle
-9-
<PAGE>
Street, Chicago, Illinois 60603-3441 or at such other place as shall be agreed
upon by you and the Company, at such time or date as shall be agreed upon by you
and the Company in the Terms Agreement (each such time and date being referred
to as a "Closing Time"). Unless otherwise specified in the applicable Terms
Agreement, payment shall be made to the Company in immediately available Federal
funds wired to such bank as may be designated by the Company. Such Certificates
shall be in such denominations and registered in such names as you may request
in writing at least two business days prior to the applicable Closing Time. Such
Certificates will be made available for examination and packaging by you no
later than 12:00 noon on the first business day prior to the applicable Closing
Time.
It is understood that the Underwriters intend to offer the Certificates
for sale to the public as set forth in the Prospectus Supplement.
SECTION 3. Covenants of the Company. The Company covenants with each of
you and each Underwriter participating in an offering of Certificates pursuant
to a Terms Agreement, with respect to such Certificates and such offering, as
follows:
(a) Immediately following the execution of each Terms Agreement,
the Company will prepare a Prospectus Supplement setting forth the
principal amount of Certificates covered thereby, the price or prices
at which the Certificates are to be purchased by the Underwriters,
either the initial public offering price or prices or the method by
which the price or prices by which the Certificates are to be sold will
be determined, the selling concession(s) and reallowance(s), if any,
any delayed delivery arrangements, and such other information as you
and the Company deem appropriate in connection with the offering of the
Certificates. The Company will furnish you a copy of the Prospectus
Supplement for your review prior to filing such Prospectus Supplement
with the Commission. Thereafter, the Company will promptly transmit
copies of the Prospectus Supplement to the Commission for filing
pursuant to Rule 424 under the 1933 Act and will furnish to the
Underwriters as many copies of the Prospectus and such Prospectus
Supplement as you shall reasonably request.
(b) If the delivery of a prospectus is required at any time in
connection with the offering or sale of the Certificates described in
the relevant Terms Agreement and if at such time any event shall have
occurred as a result of which the Prospectus as then amended or
supplemented would include an untrue statement of a material fact or
omit to state any material fact necessary in order to make the
statements therein, in the light of the circumstances under which they
were made when such Prospectus is delivered, not misleading, or, if for
any other reason it shall be necessary during such period of time to
amend or supplement the Prospectus in order to comply with the 1933
Act, the Company agrees to notify you promptly and upon your request so
to amend or supplement the Prospectus and to prepare and furnish
without charge to each Underwriter and to any
-10-
<PAGE>
dealer in securities as many copies as you may from time to time
reasonably request of an amended Prospectus or a supplement to the
Prospectus which will correct such statement or omission or effect such
compliance.
(c) During any period in which the delivery of a prospectus is
required at any time in connection with the offering or sale of the
Certificates described in the relevant Terms Agreement the Company will
give you reasonable notice of its intention to file any amendment to
the Registration Statement or any amendment or supplement to the
Prospectus, whether pursuant to the 1933 Act or otherwise, and will
furnish you with copies of any such amendment or supplement or other
documents proposed to be filed a reasonable time in advance of filing.
(d) During any period in which the delivery of a prospectus is
required at any time in connection with the offering or sale of the
Certificates described in the relevant Terms Agreement the Company will
notify you promptly (i) of the effectiveness of any amendment to the
Registration Statement, (ii) of the mailing or the delivery to the
Commission for filing of any supplement to the Prospectus or any
document other than quarterly and annual reports to be filed pursuant
to the 1934 Act, (iii) of the receipt of any comments from the
Commission with respect to the Registration Statement, the Prospectus
or any Prospectus Supplement, (iv) of any request by the Commission for
any amendment to the Registration Statement or any amendment or
supplement to the Prospectus or for additional information, (v) of the
receipt by the Company of any notification with respect to the
suspension of the qualification of the Certificates for sale in any
jurisdiction or the threat of any proceeding for that purpose and (vi)
of the issuance by the Commission of any stop order suspending the
effectiveness of the Registration Statement or the initiation of any
proceedings for that purpose. The Company will use its best efforts to
prevent the issuance of any such stop order and, if any stop order is
issued, to obtain the lifting thereof as soon as possible.
(e) The Company agrees, so long as the Certificates shall be
outstanding, or until such time as you shall cease to maintain a
secondary market in the Certificates, whichever first occurs, to
deliver to you the annual statement as to compliance delivered to the
Trustee pursuant to the applicable Pooling Agreement and the annual
statement of a firm of independent public accountants furnished to the
Trustee pursuant to the applicable Pooling Agreement, as soon as such
statements are furnished to the Company.
(f) The Company will deliver to you as many conformed copies of
the Registration Statement (as originally filed) and of each amendment
thereto (including exhibits filed therewith or incorporated by
reference therein and documents incorporated by reference in the
Prospectus) as you may reasonably request.
(g) The Company will endeavor, in cooperation with you, to qualify
the Certificates
-11-
<PAGE>
for offering and sale under the applicable securities laws of such
states and other jurisdictions of the United States as you may
reasonably designate, and will maintain or cause to be maintained such
qualifications in effect for as long as may be required for the
distribution of the Certificates, provided that in connection therewith
the Company shall not be required to qualify as a foreign corporation
or to file a general consent to service of process in any jurisdiction.
The Company will file or cause the filing of such statements and
reports as may be required by the laws of each jurisdiction in which
the Certificates have been qualified as above provided.
(h) The Company will use its best efforts to effect the listing of
the Classes of Certificates indicated in the applicable Terms Agreement
prior to the applicable Closing Time on the NYSE.
(i) The Company will file all documents required to be filed by
the Commission pursuant to the 1934 Act within the time periods
required by the 1934 Act and the rules and regulations thereunder.
SECTION 4. Conditions of Underwriters' Obligations. The obligations of
the Underwriters to purchase Certificates pursuant to any Terms Agreement shall
be subject to the accuracy of the representations and warranties on the part of
the Company herein contained, to the accuracy of the statements of the Company's
officers made pursuant hereto, to the performance by the Company of all of its
obligations hereunder and to the following additional conditions precedent:
(a) At the applicable Closing Time (i) no stop order suspending
the effectiveness of the Registration Statement shall have been issued
and no proceedings for that purpose shall have been initiated or
threatened by the Commission and the Prospectus Supplement shall have
been filed or transmitted for filing by means reasonably calculated to
result in filing with the Commission not later than the time required
by Rule 424(b) under the 1933 Act, (ii) the Certificates shall have
received the rating or ratings specified in the applicable Terms
Agreement, and (iii) there shall not have come to your attention any
facts that would cause you to believe that the Prospectus, together
with the applicable Prospectus Supplement at the time it was required
to be delivered to a purchaser of the Certificates, contained an untrue
statement of a material fact or omitted to state a material fact
necessary in order to make the statements therein, in light of the
circumstances existing at such time, not misleading. No challenge by
the Commission shall have been made to the accuracy or adequacy of the
Registration Statement and any request of the Commission for inclusion
of additional information in the Registration Statement or the
Prospectus or the Prospectus Supplement shall have been complied with
and the Company shall not have filed with the Commission any amendment
or supplement to the Registration Statement, the Prospectus or the
Prospectus Supplement without prior written notice to the Underwriters.
(b) At the applicable Closing Time you shall have received:
-12-
<PAGE>
(1) The opinion, dated as of the applicable Closing Time, of
Mayer Brown & Platt, counsel for the Company, in form and
substance satisfactory to such of you as may be named in the
applicable Terms Agreement, to the effect that:
(i) The Company has been duly authorized and is validly
existing as a corporation in good standing under the laws of
the State of Delaware.
(ii) The applicable Pooling Agreement, the applicable
Securities Purchase Agreement, this Agreement and the
applicable Terms Agreement have been duly authorized,
executed and delivered by the Company, and each is a valid
and binding obligation of the Company.
(iii) Each of the applicable Securities Purchase
Agreement and the applicable Pooling Agreement has been duly
authorized, executed and delivered by the Company, and is a
legal, valid and binding obligation of the Company
enforceable against the Company in accordance with its terms,
except that (A) such enforceability thereof may be subject to
bankruptcy, insolvency, reorganization, moratorium or other
similar laws now or hereafter in effect 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.
(iv) The execution and delivery by the Company of this
Agreement, the applicable Securities Purchase Agreement,
the applicable Terms Agreement and applicable Pooling
Agreement and the signing of the Registration Statement by
the Company are within the corporate power of the Company and
have been duly authorized by all necessary corporate action
on the part of the Company; and neither the issue and sale of
the Certificates nor the consummation of the transactions
contemplated herein or therein nor the fulfillment of the
terms hereof or thereof will, conflict with or constitute a
breach or violation of any of the terms or provisions of, or
constitute a default under, or result in the creation or
imposition of any lien, charge or encumbrance upon any
property or assets of the Company pursuant to, any contract,
indenture, mortgage, or other instrument to which the Company
is a party or by which it may be bound of which such counsel
is aware, other than the lien or liens created by the
applicable Pooling Agreement, nor will such action result in
any violation of the provisions of the certificate of
incorporation or by-laws of the Company or, any statute,
rule or regulation to which the Company is subject or by
which it is bound or any writ, injunction or decree of any
court, governmental authority or regulatory body to which
it is subject or by which it is bound of which such counsel
is aware.
(v) The Certificates have been duly authorized and, when
executed and authenticated as specified in the related Pooling
Agreement and delivered and paid for,
-13-
<PAGE>
will be validly issued, fully paid, nonassessable and
entitled to the benefits of the related Pooling Agreement.
(vi) Assuming strict compliance by the Underwriters with
the provisions of this Agreement, no filing or registration
with or notice to or consent, approval, authorization, order
or qualification of or with any court or governmental agency
or body is required for the issuance and sale of the
Certificates or the consummation by the Company of the
transactions contemplated by this Agreement, the applicable
Securities Purchase Agreement, the applicable Pooling
Agreement or the applicable Terms Agreement, except the
registration under the 1933 Act of the Certificates, and such
consents, approvals, authorizations, registrations or
qualifications as may be required under state securities or
Blue Sky laws in connection with the purchase
and distribution of the Certificates by the Underwriters.
(vii) Other than as may be set forth or contemplated in
the Prospectus, there is no action, suit or proceeding of
which such counsel is aware before or by any court or
governmental agency or body, domestic or foreign, now pending
or, to the best of such counsel's knowledge, threatened
against the Company which might result in any material
adverse change in the financial condition, earnings, affairs
or business of the Company, or which might materially and
adversely affect the properties or assets thereof or might
materially and adversely affect the performance by the
Company of its obligations under, or the validity or
enforceability of, the Certificates, this Agreement, the
applicable Securities Purchase Agreement, or the applicable
Pooling Agreement, or which is required to be disclosed in
the Registration Statement.
(viii) The Registration Statement is effective under the
1933 Act and, to the best of such counsel's knowledge, no
stop order suspending the effectiveness of the Registration
Statement has been issued under the 1933 Act or proceedings
therefor initiated or threatened by the Commission.
(ix) The applicable Pooling Agreement is not required to
be qualified under the Trust Indenture Act of 1939, as
amended.
(x) The Registration Statement and the Prospectus (other
than the financial statements and other financial and
statistical information included therein, as to which no
opinion need be rendered) as of their respective effective or
issue dates, complied as to form in all material respects
with the requirements of the 1933 Act and the Regulations
thereunder.
(xi) (A) The statements in the Prospectus under the
headings "ERISA Considerations" and "Certain Federal Income
Tax Consequences" and the statements in the applicable
Prospectus Supplement under the headings "Certain Federal
Income Tax
-14-
<PAGE>
Considerations" and "ERISA Considerations", to the extent that they
describe matters of United States federal income tax law or ERISA or
legal conclusions with respect thereto, have been prepared or reviewed
by such counsel and are accurate in all material respects and (B) the
statements in the Prospectus under the heading "Certain Legal Aspects
of the Mortgage Loans," to the extent they constitute matters of United
States federal law or legal conclusions with respect thereto, while not
purporting to discuss all possible consequences of investment in the
Certificates, are accurate in all material respects with respect to
those consequences or matters discussed therein.
(xii) The statements in the Prospectus and the applicable
Prospectus Supplement under the caption "Description of the
Certificates", insofar as they purport to summarize certain
terms of the Certificates and the applicable Pooling
Agreement, constitute a fair summary of the provisions
purported to be summarized.
(xiii) Neither the Company nor the Trust Fund created by
the applicable Pooling Agreement is not, and will not as a
result of the offer and sale of the Certificates as
contemplated in the Prospectus and in this Agreement become,
required to be registered as an "investment company" under
the 1940 Act.
(xiv) Assuming (a) ongoing compliance with all of the
provisions of the Pooling Agreement and (b) the filing of
elections, in accordance with the Pooling Agreement, to be
treated as "real estate mortgage investment conduits"
("REMICs") pursuant to Section 860D of the Internal Revenue
Code of 1986, as amended (the "Code") for Federal income tax
purposes, the Trust Fund will qualify as a REMIC as of the
Closing Date and will continue to qualify as a REMIC for so
long as there is compliance with amendments after the date
hereof to any applicable provisions of the Code and
applicable Treasury Regulations.
(xv) Assuming that the Trust Fund is treated as a REMIC
for Federal income tax purposes, neither of them nor the
Trust Fund will be subject as an entity to any tax imposed
on income, franchise or capital stock by the laws of Illinois.
Such counsel shall deliver to the NYSE the opinions set forth in
paragraphs (i), (v), (viii) and (ix).
Notwithstanding the foregoing, the opinions set forth in paragraphs
(i), (ii), (iv) and (vii) may be rendered by Kirk P. Flores, counsel of AANA.
Such counsel shall deliver to you such additional opinions addressing
the transfer by the Company to the Trustee of its right, title and interest in
and to the Underlying Certificates and other property included in the Trust Fund
at the Closing Time as may be required by each Rating Agency rating the
Certificates.
-15-
<PAGE>
Such counsel shall state that it has participated in conferences with
officers and other representatives of the Company, your counsel, representatives
of the independent accountants for the Company and you at which the contents of
the Registration Statement and the Prospectus and related matters were discussed
and, although such counsel is not passing upon and does not assume
responsibility for, the factual accuracy, completeness or fairness of the
statements contained in the Registration Statement or the Prospectus (except as
stated in paragraphs (xi) and (xii) above) and has made no independent check or
verification thereof for the purpose of rendering its opinion, on the basis of
the foregoing, nothing has come to their attention that leads such counsel to
believe that either the Registration Statement, at the time it became effective
and at the applicable Closing Time, contained an untrue statement of a material
fact or omitted to state a material fact required to be stated therein or
necessary in order to make the statements therein not misleading, or that the
Prospectus contained or contains as of the date thereof and at the applicable
Closing Time any untrue statement of a material fact or omitted or omits to
state a material fact necessary to make the statements therein, in the light of
the circumstances under which they were made, not misleading, except that such
counsel need express no view with respect to the financial statements, schedules
and other financial and statistical data included in or incorporated by
reference into the Registration Statement, the Prospectus or the Prospectus
Supplement.
Such counsel may state that their opinions relate only to laws of the
State of New York, the Federal laws of the United States and the General
Corporation Law of the State of Delaware.
In rendering such opinions, such counsel may rely, as to matters of
fact, to the extent deemed proper and stated therein, on certificates of
responsible officers of the Company, the Trustee or public officials.
(2) The favorable opinion of counsel to the Trustee, dated
as of the applicable Closing Time, addressed to you and in form
and scope satisfactory to your counsel, to the effect that:
(i) The Trustee is a national association, duly organized
and validly existing in good standing under the laws of the
United States, and has all requisite power and authority to
enter into the Pooling Agreement and to perform its
obligations thereunder.
(ii) To the knowledge of such counsel, there is no action,
suit, proceeding or investigation pending or threatened
against the Trustee that could materially adversely affect
the ability of the Trustee to perform its obligations under
the Pooling Agreement.
(iii) The Trustee has duly authorized, executed and
delivered the applicable Pooling Agreement and such Pooling
Agreement will constitute the legal, valid and binding
obligation of the Trustee.
-16-
<PAGE>
(iv) The Trustee has full power and authority to execute
and deliver the applicable Pooling Agreement and to perform
its obligations thereunder.
(v) No consent, approval or authorization of, or
registration, declaration or filing with, any court or
governmental agency or body of the jurisdiction of its
organization is required for the execution, delivery or
performance by the Trustee of the Pooling Agreement.
(vi) The Certificates have been duly and validly executed,
authenticated and delivered by the Trustee in accordance with
the Pooling Agreement.
(vii) The performance by the Trustee of its duties
pursuant to the Pooling Agreement does not conflict with or
result in a breach or violation of any term or provision of,
or constitute a default under, any statute or regulation
currently governing the Trustee.
(3) The favorable opinion or opinions, dated as of the
applicable Closing Time, of counsel for the Underwriters,
acceptable to the Underwriters.
(4) The favorable opinions, dated the applicable Closing
Time of counsel for AANA, acceptable to the Underwriters.
In rendering such opinion, such counsel may rely, as to matters of
fact, to the extent deemed proper and stated therein, on certificates of
responsible officers of the Trustee or public officials.
Such counsel shall deliver such additional opinions addressing the
transfer by DLJ to the Company of its right, title and interest in and to the
Underlying Certificates at the Closing Time as may be required by each Rating
Agency rating the Certificates.
(c) At the applicable Closing Time you shall have received a
certificate of the President or a Vice President and the Treasurer or
the Secretary of each of the Company and AANA, dated as of such Closing
Time, to the effect that the representations and warranties of the
Company or AANA, as the case may be, contained in Section 1 are true
and correct with the same force and effect as though such Closing Time
were a Representation Date and that the Company or AANA, as the case
may be, has complied with all agreements and satisfied all the
conditions on its part to be performed or satisfied at or prior to the
Closing Time.
(d) You shall have received from Deloitte & Touche LLP with
respect to certain information in the Prospectus Supplement, or other
independent certified public accountants acceptable to you, letters,
dated as of the date of the applicable Terms
-17-
<PAGE>
Agreement and as of the applicable Closing Time, delivered at such
times, in the form and substance reasonably satisfactory to you.
(e) At the applicable Closing Time, with respect to a Series of
Certificates, the Certificates shall have received the certificate
rating or ratings specified in the related Terms Agreement.
(f) At the applicable Closing Time, the Classes of Certificates
indicated in the applicable Terms Agreement shall have been approved
for listing, subject only to official notice of issuance, if and as
specified in the applicable Terms Agreement.
(g) At the applicable Closing Time, counsel for the Underwriters
shall have been furnished with such other documents and opinions as
they may reasonably require for the purpose of enabling them to pass
upon the issuance and sale of the Certificates as herein contemplated
and related proceedings or in order to evidence the accuracy and
completeness of any of the representations and warranties, or the
fulfillment of any of the conditions, herein contained; and all
proceedings taken by the Company in connection with the issuance and
sale of the Certificates as herein contemplated shall be reasonably
satisfactory in form and substance to you and counsel for the
Underwriters.
If any condition specified in this Section shall not have been
fulfilled when and as required to be fulfilled or, if any of the opinions and
certificates required hereby shall not be in all material respects reasonably
satisfactory to you and your counsel, the applicable Terms Agreement may be
terminated by you by notice to the Company at any time at or prior to the
applicable Closing Time, and such termination shall be without liability of any
party to any other party except as provided in Section 5.
SECTION 5. Payment of Expenses. DLJ covenants and agrees with the
Company that DLJ will pay or cause to be paid all expenses incident to the
performance of the Company's obligations under this Agreement and all other fees
and expenses associated with the transactions referred to herein, including, but
not limited to, the fees and expenses of the Trustee, Rating Agencies, printer,
accounting firms, and the fees and expenses relating to the establishment of the
Company's shelf registration statement as set forth in the applicable Terms
Agreement. The Underwriters covenant and agree to pay all of their own costs and
expenses, including underwriting and due diligence expenses, the fees of their
counsel, transfer taxes on resale of any of the Certificates by them and any
advertising expenses connected with any offers they may make.
SECTION 6. Indemnification.
(a) The Company and AANA, jointly and severally, will indemnify
and hold harmless the Underwriters and each person, if any, who
controls the Underwriters within
-18-
<PAGE>
the meaning of the 1933 Act, against any losses, claims, damages,
expenses or liabilities, joint or several, to which such Underwriter or
such controlling person may become subject, under the 1933 Act or
otherwise, insofar as such losses, claims, damages, expenses or
liabilities (or actions in respect thereof) arise out of or are based
upon (x) any untrue statement or alleged untrue statement of a material
fact contained in the Registration Statement (or any amendment thereto)
or the omission or alleged omission to state in the Registration
Statement (or any amendment thereto) a material fact required to be
stated therein or necessary to make the statements therein not
misleading or (y) any untrue statement or alleged untrue statement of a
material fact contained in the Prospectus (or supplement thereto), or
the omission or alleged omission to state in the Prospectus (or any
supplement thereto) a material fact required to be stated therein or
necessary to make the statements therein, in light of the circumstances
in which they were made, not misleading, and will reimburse each such
indemnified party for any legal or other expenses reasonably incurred
by it in connection with investigating or defending any such action or
claim; provided, however, that unless otherwise specified in the
applicable Terms Agreement, the Company shall not be liable in any such
case to the extent that any such loss, claim, damage or liability
arises out of or is based upon an untrue statement or alleged untrue
statement or omission or alleged omission made in (a) the Prospectus
under the heading "Description of the Pool", any Pool Information and
in Appendix I to the Prospectus or (b) any such document in reliance
upon and in conformity with written information furnished to the
Company by or on behalf of the Underwriters expressly for use therein.
This indemnity agreement will be in addition to any liability which the
Company may otherwise have.
(b) Each Underwriter, severally and not jointly, will indemnify
and hold harmless the Company, each of its officers who signed the
Registration Statement, its directors, and any person controlling the
Company within the meaning of the 1933 Act against any losses, claims,
damages, expenses or liabilities to which the Company or any such
officer, director or controlling person may become subject, under the
1933 Act or otherwise, insofar as such losses, claims, damages,
expenses or liabilities (or actions in respect thereof) arise out of or
are based upon (x) any untrue statement or alleged untrue statement of
a material fact contained in the Registration Statement (or any
amendment thereto), or the omission or alleged omission to state in the
Registration Statement (or any amendment thereto) a material fact
required to be stated therein or necessary to make the statements
therein, not misleading or (y) any untrue statement or alleged untrue
statement of a material fact contained in the Prospectus (or any
supplement thereto), or the omission or alleged omission to state in
the Prospectus (or any supplement thereto) a material fact required to
be stated therein or necessary to make the statements therein, in light
of the circumstances in which they were made, not misleading, in each
case to the extent, but only to the extent, that such untrue statement
or alleged untrue statement or omission or alleged omission was made in
reliance upon and in conformity with written information furnished to
the Company by or on behalf of the Underwriters expressly for use
therein and will reimburse the Company or any such director, officer or
controlling person for
-19-
<PAGE>
any legal or other expenses reasonably incurred by the Company, any
such officer, director or controlling person in connection with
investigating or defending any such action or claim. This indemnity
agreement is in addition to any liability which the Underwriters may
otherwise have. The Company acknowledges that, unless otherwise set
forth in the applicable Terms Agreement, the statements set forth in
the last paragraph of the cover page, such paragraph beginning with
"The underwriters'", and fourth sentence of the first paragraph under
the caption "Method of Distribution" each as included in the applicable
Prospectus Supplement relating to a Series of Certificates, together
with the DLJ Information (as defined in Section 10 hereof) relating to
a Series of Certificates constitute the only information furnished in
writing by or on behalf of the Underwriters expressly for use in the
Registration Statement relating to such Series of Certificates as
originally filed or in any amendment thereof, any related preliminary
prospectus or the Prospectus or in any amendment thereof or supplement
thereto, as the case may be.
(c) Promptly after receipt by an indemnified party under this
Section of notice of the commencement of any action, such indemnified
party shall, if a claim in respect thereof is to be made against an
indemnifying party under this Section, notify such indemnifying party
in writing of the commencement thereof; but the omission so to notify
the indemnifying party shall not relieve it from any liability which it
may have to any indemnified party otherwise than under this Section. In
case any such action shall be brought against any indemnified party and
it shall notify the indemnifying party of the commencement thereof, the
indemnifying party shall be entitled to participate therein and, to the
extent that it shall wish, jointly with any other indemnifying party
similarly notified, to assume the defense thereof, with counsel
satisfactory to such indemnified party (who shall not, except with the
consent of the indemnified party, be counsel to the indemnifying
party); and, after notice from the indemnifying party to such
indemnified party of its election so to assume the defense thereof, the
indemnifying party shall not be liable to such indemnified party under
this Section for any legal expenses of other counsel or any other
expenses, in each case subsequently incurred by such indemnified party,
in connection with the defense thereof other than reasonable costs of
investigation. Notwithstanding the foregoing, the indemnified party or
parties shall have the right to employ its or their own counsel in any
such case and the fees and expenses of one such counsel shall be at the
expense of the indemnifying party if (i) the employment of such counsel
shall have been authorized in writing by the indemnifying party in
connection with the defense of such action, (ii) the indemnifying party
shall not have employed counsel to have charge of the defense of such
action within a reasonable time after notice of commencement of the
action, or (iii) the indemnified party or parties shall have reasonably
concluded that there may be defenses available to it or them and/or
other indemnified parties which are different from or additional to
those available to the indemnifying party (in which case the
indemnifying party shall not have the right to direct the defense of
such action on behalf of the indemnified party). Anything in this
subsection to the contrary notwithstanding, an indemnifying party shall
not be liable for
-20-
<PAGE>
any settlement of any claim or action effected without its written
consent; provided, however, that such consent was not unreasonably
withheld.
(d) If the indemnification provided for in this Section 6 is
unavailable to or insufficient to hold harmless an indemnified party
under subsection (a) or (b) above in respect of any losses, claims,
damages, expenses or liabilities (or actions in respect thereof)
referred to therein, then each indemnifying party shall contribute to
the amount paid or payable by such indemnified party as a result of
such losses, claims, damages, expenses or liabilities (or actions in
respect thereof) in such proportion as is appropriate to reflect the
relative benefits received by the Company on the one hand and the
Underwriters on the other from the offering of the Certificates to
which such loss, claim, damage, expense or liability (or actions in
respect thereof) relates. If, however, the allocation provided by the
immediately preceding sentence is not permitted by applicable law, then
each indemnifying party shall contribute to such amount paid or payable
by such indemnified party in such proportion as is appropriate to
reflect not only such relative benefits but also the relative fault of
the Company on the one hand and the Underwriters on the other in
connection with the statements or omissions which resulted in such
losses, claims, damages or liabilities (or actions in respect thereof),
as well as any other relevant equitable considerations. The relative
benefits received by the Company on the one hand and the Underwriters
on the other shall be deemed to be in the same proportion as the total
net proceeds from such offering (before deducting expenses) received by
the Company bear to the total underwriting discounts and commissions
(or in the case of a public offering in negotiated transactions, the
difference between the proceeds to the Company and the aggregate price
received from the public) received by such Underwriters. The relative
fault of the Company on the one hand and the Underwriters on the other
shall be determined by reference to, among other things, whether the
untrue or alleged untrue statement of a material fact or the omission
or alleged omission to state a material fact relates to information
supplied by the Company on the one hand or such Underwriters on the
other and the parties' relative intent, knowledge, access to
information and opportunity to correct or prevent such statement or
omission. Notwithstanding anything to the contrary in this Section
6(d), if the losses, claims, damages or liabilities (or actions in
respect thereof) referred to in this Section 6(d) arise out of an
untrue statement or alleged untrue statement of a material fact
contained in any DLJ 8-K (as such term is defined in Section 10 hereof)
then each indemnifying party shall contribute to the amount paid or
payable by such indemnified party as a result of such losses, claims,
damages or liabilities (or actions in respect thereof) in such
proportion as is appropriate to reflect the relative fault of the
Company on the one hand and the Underwriters on the other (determined
in accordance with the preceding sentence) in connection with the
statements or omissions in such DLJ 8-K which resulted in such losses,
claims, damages or liabilities (or actions in respect thereof), as well
as any other equitable considerations. The Company and the Underwriters
agree that it would not be
-21-
<PAGE>
just and equitable if contribution pursuant to this subsection (d) were
determined by pro rata allocation even if the Underwriters were treated
as one entity for such purpose or by any other method of allocation
which does not take account of the equitable considerations referred to
in this subsection (d). The amount paid or payable by an indemnified
party as a result of the losses, claims, damages or liabilities (or
actions in respect thereof) referred to above in this subsection (d)
shall be deemed to include any legal or other expenses reasonably
incurred by such indemnified party in connection with investigation or
defending any such action or claim. Notwithstanding the provisions of
this subsection (d), no Underwriter shall be required to contribute any
amount in excess of the amount by which the total price at which the
Certificates underwritten by it and distributed to the public were sold
to the public exceeds the amount of any damages which such Underwriter
has otherwise been required to pay by reason of such untrue or alleged
untrue statement or omission or alleged omission. No person guilty of
fraudulent misrepresentation (within the meaning of Section 11(f) of
the 1933 Act) shall be entitled to contribution from any person who was
not guilty of such fraudulent misrepresentation. The obligations of the
Underwriters to contribute pursuant to this subsection (d) are several
in proportion to their respective underwriting obligations with respect
to such Certificates and not joint.
SECTION 7. Representations, Warranties, and Agreements to Survive
Delivery. All representations, warranties and agreements contained in this
Agreement, or contained in certificates of officers of the Company submitted
pursuant hereto, shall remain operative and in full force and effect, regardless
of any termination of this Agreement, or the applicable Terms Agreement or any
investigation made by or on behalf of the Underwriters or any controlling person
thereof, or by or on behalf of the Company, its officers or directors and shall
survive delivery of any Certificates to the Underwriters.
SECTION 8. Termination of Agreement. This Agreement may be terminated
for any reason at any time by either the Company or you upon the giving of
thirty days' notice of such termination to the other party hereto; provided,
however, that if a Terms Agreement has been entered into with respect to a
particular transaction, this Agreement and the Terms Agreement may not be
terminated in the manner set forth in this sentence with respect to such
particular transaction. You, as Representative of the Underwriters named in any
Terms Agreement may also terminate such Terms Agreement, immediately upon notice
to the Company, at any time at or prior to the applicable Closing Time (i) if
there has been, since the date of such Terms Agreement or since the respective
dates as of which information is given in the Registration Statement or
Prospectus, any change, or any development involving a prospective change, in or
affecting the condition, financial or otherwise, earnings, affairs or business
of the Company or AANA, whether or not arising in the ordinary course of
business, which in your judgment would materially impair the market for, or the
investment quality of, the Certificates, or (ii) if there has occurred any
material outbreak or escalation of hostilities or other calamity or crisis the
effect of which on the financial markets of the United States is such as to make
it, in your reasonable judgment, impracticable to
-22-
<PAGE>
market the Certificates or enforce contracts for the sale of the Certificates,
or (iii) if trading in securities generally on either the NYSE or the American
Stock Exchange has been suspended or materially limited or any setting of
minimum prices shall have been established or (iv) if a general moratorium of
commercial banking activities has been declared by either Federal or New York
State authorities. In the event of any such termination, (A) the covenants set
forth in Section 3 with respect to any offering of Certificates shall remain in
effect so long as the Underwriters own any such Certificates purchased from the
Company pursuant to the applicable Terms Agreement and (B) the covenant set
forth in Section 3(c), the provisions of Section 5, the indemnity agreement and
contribution provisions set forth in Section 6, and the provisions of Sections 7
and 12 shall remain in effect.
SECTION 9. Default by One or More of the Underwriters.
(a) one or more of the Underwriters participating in an offering
of Certificates shall fail at the applicable Closing Time to purchase
the Certificates which it or they are obligated to purchase hereunder
and under the applicable Terms Agreement (the "Defaulted
Certificates"), then such of you as are named therein shall arrange for
you or another party or other parties to purchase the Defaulted
Certificates upon the terms contained herein. If within thirty-six
hours after such default by any Underwriter you do not arrange for the
purchase of such Defaulted Certificates, then the Company shall be
entitled to a further period of thirty-six hours within which to
procure another party or other parties reasonably satisfactory to you
to purchase such Defaulted Certificates on the terms contained herein.
In the event that, within the respective prescribed periods, you notify
the Company that you have so arranged for the purchase of such
Defaulted Certificates, or the Company notifies you that it has so
arranged for the purchase of such Defaulted Certificates, you or the
Company shall have the right to postpone the Closing Time for a period
of not more than seven days, in order to effect whatever changes may
thereby be made necessary in the Registration Statement or the
Prospectus, or in any other documents or arrangements, and the Company
agrees to file promptly any amendments to the Registration Statement or
the Prospectus which in your opinion may thereby be made reasonably
necessary. The term "Underwriter" as used in this Agreement shall
include any person substituted under this Section with like effect as
if such person had originally been party to this Agreement with respect
to the Certificate.
(b) If, after giving effect to any arrangements for the purchase
of Defaulted Certificates of a defaulting Underwriter or Underwriters
by you and the Company as provided in subsection (a) above, the
aggregate principal amount of such Defaulted Certificates which remains
unpurchased does not exceed 10% of the aggregate principal amount of
the Certificates to be purchased pursuant to the applicable Terms
Agreement, then the Company shall have the right to require each
non-defaulting Underwriter to purchase the principal amount of
Certificates which such Underwriter agreed to purchase
-23-
<PAGE>
hereunder and, in addition, to require each non-defaulting Underwriter
to purchase its pro rata share (based on the principal amount of
Certificates which such Underwriter agreed to purchase pursuant to the
applicable Terms Agreement) of the Defaulted Certificates of the
defaulting Underwriter or Underwriters for which such arrangements have
not been made; but nothing herein shall relieve a defaulting
Underwriter from liability for its default.
(c) If, after giving effect to any arrangements for the purchase
of the Defaulted Certificates of the defaulting Underwriter or
Underwriters by you and the Company as provided in subsection (a)
above, the aggregate principal amount of such Defaulted Certificates
which remains unpurchased exceeds 10% of the aggregate principal amount
of the Certificates to be purchased pursuant to the applicable Terms
Agreement, or if the Company shall not exercise the right described in
subsection (b) above to require non-defaulting Underwriters to purchase
Defaulted Certificates of a defaulting Underwriter or Underwriters,
then this Agreement shall thereupon terminate, without liability on the
part of any non-defaulting Underwriter or the Company, except for the
expenses to be borne by the Company and the Underwriters as provided in
Section 5 hereof and the indemnity agreement and contribution
provisions in Section 6 hereof; but nothing herein shall relieve a
defaulting Underwriter from liability for its default.
SECTION 10. Computational Materials and ABS Term Sheets.
(a) DLJ acknowledges that, subsequent to the date on which the
Registration Statement became effective and up to and including the
date on which the Prospectus Supplement and Prospectus with respect to
a Series of Certificates is first made available to DLJ, DLJ may
furnish to various potential investors in such Series of Certificates,
in writing: (i) "Computational Materials", as defined in a no-action
letter (the "Kidder No-Action Letter") issued by the staff of the
Commission on May 20, 1994 to Kidder, Peabody Acceptance Corporation I,
et al., as modified by a no-action letter (the "First PSA No-Action
Letter") issued by the staff of the Commission on May 27, 1994 to the
Public Securities Association (the "PSA") and as further modified by a
no-action letter (the "Second PSA No-Action Letter", and together with
the Kidder No-Action Letter and the First PSA No-Action Letter, the
"No-Action Letters") issued by the staff of the Commission on February
17, 1995 to the PSA; (ii) "Structural Term Sheets" as defined in the
Second PSA No-Action Letter; and/or (iii) "Collateral Term Sheets" as
defined in the Second PSA No-Action Letter. AAI covenants and agrees
that it will not furnish, prepare or use any Computational Materials,
Structural Term Sheets or Collateral Term Sheets in connection with the
offering of Series 1999-RS1 Certificates.
(b) In connection with each Series of Certificates, DLJ shall
furnish to the Company (via hard copy), at least one (1) business day
prior to the time of filing of the Prospectus pursuant to Rule 424
under the 1933 Act, all Computational Materials used by DLJ and
-24-
<PAGE>
required to be filed with the Commission in accordance with the
No-Action Letters (such Computational Materials, the "DLJ Furnished
Computational Materials").
(c) In connection with each Series of Certificates, DLJ shall
furnish to the Company (via hard copy), at least one (1) business day
prior to the time of filing of the Prospectus pursuant to Rule 424
under the Act, all Structural Term Sheets used by DLJ and required to
be filed with the Commission in accordance with the No-Action Letters
(such Structural Term Sheets, the "DLJ Furnished Structural Term
Sheets").
(d) In connection with each Series of Certificates, DLJ shall
furnish to the Company (via hard copy), within one (1) business day
after the first use thereof, all Collateral Term Sheets used by DLJ and
required to be filed with the Commission in accordance with the
No-Action Letters (such Collateral Term Sheets, the "DLJ Furnished
Collateral Term Sheets") and shall advise the Company of the date on
which each such Collateral Term Sheet was first used.
(e) The Company shall prepare and file with the Commission, in
accordance with the No-Action Letters, one or more current reports on
Form 8-K (collectively, together with any amendments and supplements
thereto, the "DLJ 8-K," and each a "DLJ 8-K") which shall include as
one or more exhibits thereto the DLJ Furnished Computational Materials,
the DLJ Furnished Structural Term Sheets and the DLJ Furnished
Collateral Term Sheets.
(f) DLJ shall cooperate with the Company and with Deloitte &
Touche in obtaining a letter, in form and substance satisfactory to the
Company and DLJ, of Deloitte & Touche regarding the information in any
DLJ 8-K consisting of DLJ Furnished Computational Materials and/or DLJ
Furnished Structural Term Sheets, in each case in EDGAR format as
formatted by the Company.
(g) DLJ represents and warrants to, and covenants with, the
Company that the DLJ Information (defined below) is not misleading and
not inaccurate in any material respect and that any Pool Information
(defined below) contained in any DLJ 8-K which is not otherwise
inaccurate in any material respect is not presented in the DLJ 8-K in a
way that is either misleading or inaccurate in any material respect.
DLJ further covenants with the Company that if any Computational
Materials or ABS Term Sheets (as such term is defined in the Second PSA
No-Action Letter) contained in any DLJ 8-K are found to include any
information that is misleading or inaccurate in any material respect,
DLJ promptly shall inform the Company of such finding, provide the
Company with revised and/or corrected Computational Materials or ABS
Term Sheets, as the case may be, and promptly prepare and deliver to
the Company (in hard copy) for filing with the Commission in accordance
herewith, revised and/or corrected Computational Materials or ABS Term
Sheets, as the case may be.
-25-
<PAGE>
(h) DLJ covenants that all Computational Materials and ABS Term
Sheets used by it shall contain a legend substantially as set forth
below:
"THIS INFORMATION IS FURNISHED TO YOU SOLELY BY DONALDSON, LUFKIN
& JENRETTE SECURITIES CORPORATION AND NOT BY THE ISSUER OR ANY OF
ITS AFFILIATES. NEITHER THE ISSUER NOR ANY OF ITS AFFILIATES MAKES
ANY REPRESENTATION AS TO THE ACCURACY OR COMPLETENESS OF THE
INFORMATION HEREIN. THE INFORMATION HEREIN IS PRELIMINARY, AND
WILL BE SUPERSEDED BY THE APPLICABLE PROSPECTUS SUPPLEMENT AND BY
ANY OTHER INFORMATION SUBSEQUENTLY FILED WITH THE SECURITIES AND
EXCHANGE COMMISSION.
(i) DLJ covenants that all Collateral Term Sheets used by it shall
contain an additional legend substantially as set forth below:
"THE INFORMATION CONTAINED HEREIN WILL BE SUPERSEDED BY THE
DESCRIPTION OF THE UNDERLYING CERTIFICATES CONTAINED IN THE
PROSPECTUS SUPPLEMENT."
(j) DLJ covenants that all Collateral Term Sheets (other than the
initial Collateral Term Sheet) shall contain the following additional
legend:
"THE INFORMATION CONTAINED HEREIN SUPERSEDES THE INFORMATION IN
ALL PRIOR COLLATERAL TERM SHEETS, IF ANY."
(k) For purposes of this Agreement, the term "DLJ Information"
means such portion, if any, of the information contained in the DLJ 8-K
that is not Pool Information. "Pool Information" means the information
regarding the characteristics (e.g. balance, rate, maturity etc.) of
the Underlying Certificates; provided, however, that if any information
that would otherwise constitute Pool Information is not information
appearing in the monthly remittance report specified in the applicable
Terms Agreement or the data tape referred to in Section 5.07(c) of the
applicable Securities Purchase Agreement or accurately derived
therefrom, such information shall not be Pool Information.
(l) If the Underwriters does not provide any Computational
Materials or ABS Term Sheets to the Company pursuant to subsections (b)
- (d) above, the Underwriters shall be deemed to have represented, as
of the Closing Time, that they did not provide any prospective
investors with any information in written or electronic form in
connection with the offering of the Certificates that is required to be
filed with the Commission in accordance with the No-Action Letters, and
the Underwriters shall provide the Company
-26-
<PAGE>
with a certification to that effect at the Closing Time.
SECTION 11. Notices. All notices and other communications hereunder
shall be in writing and shall be deemed to have been duly given if mailed,
delivered, telexed, or telegraphed and confirmed or transmitted by any standard
form of telecommunication. Notices to DLJ shall be directed to you at the
address set forth on the first page hereof, to the attention of Shannon Smith,
with a copy to the General Counsel's office on the 23rd floor and notices to AAI
shall be directed to you at the address set forth on the first page hereof, to
the attention of Fixed Income Department,Maria Fregosi; with a copy to Legal
Department, ABN AMRO Incorporated, 1325 Avenue of the Americas, New York, New
York 10019, attention: Mark Egert. Notices to the Company or to AANA shall be
directed to ABN AMRO Mortgage Corporation Securitization Department, c/o ABN
AMRO North America, Inc., 135 S. LaSalle Street, Suite 925, Chicago, Illinois,
attention: Stewart Fleming, with a copy to Legal Department, ABN AMRO North
America, Inc., 135 S. LaSalle Street, Suite 925, Chicago, Illinois.
SECTION 12. Parties. This Agreement shall be binding upon and inure
solely to the benefit of you and the Company and to the extent provided in
Section 6 hereof, the officers and directors of the Company and each person who
controls the Company or any Underwriter and their respective heirs, executors,
administrators, successors and assigns and any Terms Agreement shall be binding
upon and inure solely to the benefit of the Company and any Underwriter who
becomes a party to a Terms Agreement and to the extent provided in Section 6
hereof, the officers and directors of the Company and each person who controls
the Company or any Underwriter and their respective heirs, executors,
administrators, successors and assigns. Nothing expressed or mentioned in this
Agreement or a Terms Agreement is intended or shall be construed to give any
person, firm or corporation, other than the parties hereto or thereto and their
respective successors and the controlling person and officers and directors
referred to in Section 6 hereof and their heirs any legal or equitable right,
remedy or claim under or with respect to this Agreement or a Terms Agreement or
any provision herein or therein contained.
SECTION 13. Governing Law and Time. This Agreement and each Terms
Agreement shall be governed by and construed in accordance with the laws of the
State of New York. Specified times of day refer to New York City time.
SECTION 14. Counterparts. This Agreement and any Terms Agreement may be
executed in any number of counterparts (which execution may take the form of an
exchange of any standard form of written telecommunication between you and the
Company), each of which shall constitute an original of any party whose
signature appears on it, and all of which shall together constitute a single
instrument.
[SIGNATURES COMMENCE ON FOLLOWING PAGE]
-27-
<PAGE>
If the foregoing is in accordance with your understanding of our
agreement, please sign and return to us a counterpart hereof, whereupon this
instrument along with all counterparts will become a binding agreement between
you and the Company in accordance with its terms.
Very truly yours,
ABN AMRO MORTGAGE CORPORATION
By: /s/ Stewart W. Fleming
--------------------------------------
Name: Stewart W. Fleming
Title: Senior Vice President
ABN AMRO NORTH AMERICA, INC.
By: /s/ Mark A. Nystuen
--------------------------------------
Name: Mark A. Nystuen
Title: Senior Vice President
By: /s/ Thomas C. Heagy
--------------------------------------
Name: Thomas C. Heagy
Title: Senior Vice President
CONFIRMED AND ACCEPTED, as of
the date first above written:
DONALDSON, LUFKIN & JENRETTE
SECURITIES CORPORATION
By: /s/ Shannon Smith
--------------------------------------
Name: Shannon Smith
Title: Senior Vice President
ABN AMRO INCORPORATED
-28-
<PAGE>
By: /s/ Maria Fregosi
--------------------------------------
Name: Maria Fregosi
Title: First Vice President
-29-
<PAGE>
EXHIBIT A
RESECURITIZATION PASS-THROUGH CERTIFICATES
ABN AMRO MORTGAGE CORPORATION, DEPOSITOR
TERMS AGREEMENT
---------------
Dated: _________, 19__
To: ABN AMRO MORTGAGE CORPORATION
Re: Underwriting Agreement, dated as of July __, 1999
(the "Underwriting Agreement")
Ladies and Gentlemen:
The undersigned (being herein called the "Underwriters"), understand
that ABN AMRO Mortgage Corporation, a Delaware corporation (the "Company"),
proposes to issue and sell $_________ original principal amount of
Resecuritization Pass-Through Certificates described below (the "Certificates").
The Certificates will be issued under a Pooling Agreement dated as of
_______________ among the Company, as depositor, and _____________ as trustee.
The terms of the Certificates are summarized below and are more fully described
in the Company's Prospectus supplement prepared with respect to the
Certificates.
All the provisions (including defined terms) contained in the
Underwriting Agreement are incorporated by reference herein in their entirety
and shall be deemed to be part of this Terms Agreement to the same extent as if
such provisions had been set forth in full herein. The Closing Time referred to
in Section 2 of the Underwriting Agreement shall be _______ a.m., [Chicago,
Illinois] time, on _____________. Subject to the terms and conditions set forth
or incorporated by reference herein, the Company hereby agrees to sell and the
Underwriters agree to purchase, severally and not jointly, the [respective]
original principal amount[ s] of Certificates set forth opposite [its] [their]
name[s] in Exhibit I hereto at the purchase price set forth below.
The Underwriters will offer the Certificates for sale upon the terms
and conditions set forth in the Prospectus.
Subject to the terms and conditions set forth or incorporated by
reference herein, the Underwriters will pay for the Certificates at the time and
place and in the manner set forth in the Underwriting Agreement.
-30-
<PAGE>
Series Designation: __________________
Terms of the Certificates and Underwriting Compensation:
<TABLE>
<CAPTION>
Original
Principal Remittance Price to
Classes Amount* Rate Public
- ------- --------- ---------- --------
<S> <C> <C> <C>
**
</TABLE>
* Approximate. Subject to permitted variance in each case of plus
or minus 5%.
** The [Class A] Certificates are being offered by the
Underwriter from time to time in negotiated transactions or
otherwise at varying prices to be determined, in each case, at
the time of sale.
Certificate Rating:
_____ by [Rating Agency]
_____ by [Rating Agency]
REMIC Election:
The Company [does not] intend[s] to cause the Pool to be
treated as a REMIC.
Credit Enhancement:
Cut-off Date:
The Cut-off Date is ___________, 19__.
Remittance Date:
The ____ day of each month (or, if such ____ day is not a
business day, the business day immediately following) commencing __________,
19__.
-31-
<PAGE>
Purchase Price:
The purchase price payable by the Underwriter for the [Class A]
Certificates is ___% of the aggregate principal balance of the [Class A]
Certificates as of the Closing Date plus accrued interest at the per annum rate
of ___% from __________, 19__ up to but not including the Closing Date.
Underwriting Commission:
Notwithstanding anything to the contrary in the Underwriting Agreement,
no additional underwriting commission shall be payable by the Company to the
Underwriter in connection with the purchase of the Certificates.
Information Provided by Underwriter: [Reference to DEC/YIELD Tables in Pro.
Supp.]
Closing Date and Location:
__________ 19__ at the [Chicago, Illinois] offices of Mayer, Brown &
Platt
Classes To Be Listed on New York Stock Exchange:
-32-
<PAGE>
Please confirm your agreement by having an authorized Officer
sign a copy of this Agreement in the space set forth below and returning a
signed copy to us.
DONALDSON, LUFKIN & JENRETTE
SECURITIES CORPORATION
By:_________________________________
Name:
Title:
ABN AMRO INCORPORATED
By:_________________________________
Name:
Title:
ACCEPTED:
ABN AMRO MORTGAGE CORPORATION
By:_____________________________________
Name:
Title:
ABN AMRO NORTH AMERICA, INC.
By:_____________________________________
Name:
Title:
-33-
<PAGE>
Exhibit I
Original
Principal
Amount of
Name Certificates
- ---- ------------
Total ==============
<PAGE>
Exhibit 1.2
RESECURITIZATION PASS-THROUGH CERTIFICATES
ABN AMRO MORTGAGE CORPORATION, DEPOSITOR
TERMS AGREEMENT
Dated: July 27, 1999
To: ABN AMRO MORTGAGE CORPORATION
Re: Underwriting Agreement, dated as of July 27, 1999 (the "Underwriting
Agreement")
Ladies and Gentlemen:
The undersigned (being herein called the "Underwriters"), understand
that ABN AMRO Mortgage Corporation, a Delaware corporation (the "Company"),
proposes to issue and sell $47,753,042 original principal amount of
Resecuritization Pass-Through Certificates described below (the "Certificates").
The Certificates will be issued under a Pooling Agreement dated as of July 1,
1999 between the Company, as depositor, and The First National Bank of Chicago,
as trustee. The terms of the Certificates are summarized below and are more
fully described in the Company's Prospectus dated July 27, 1999, as supplemented
by the Prospectus Supplement dated July 27, 1999 prepared with respect to the
Certificates.
All the provisions (including defined terms) contained in the
Underwriting Agreement are incorporated by reference herein in their entirety
and shall be deemed to be part of this Terms Agreement to the same extent as if
such provisions had been set forth in full herein. The Closing Time referred to
in Section 2 of the Underwriting Agreement shall be 10:00 a.m., Chicago,
Illinois time, on July 30, 1999. Subject to the terms and conditions set forth
or incorporated by reference herein, the Company hereby agrees to sell and the
Underwriters agree to purchase, severally and not jointly, the original
principal amount of Certificates set in Exhibit I hereto at the purchase price
set forth below.
The Underwriters will offer the Certificates for sale upon the terms
and conditions set forth in the Prospectus.
Subject to the terms and conditions set forth or incorporated by
reference herein, the Underwriters will pay for the Certificates at the time and
place and in the manner set forth in the Underwriting Agreement.
<PAGE>
Series Designation: ABN AMRO Mortgage Corporation,
Resecuritization Pass-Through Certificates,
Series 1999-RS1
Terms of the Certificates and Underwriting Compensation:
<TABLE>
<CAPTION>
Original
Classes or Principal Remittance Price to
Components Amount* Rate Public
- ---------- --------- ---------- --------
<S> <C> <C> <C>
Class A $22,802,942.00 (1) **
A-1-C $15,582,530.00*** 8.00% n/a
A-2-C $7,220,0412.00*** 0.00% n/a
A-3-C (2) 8.00% n/a
Class B-1 $10,960,000.00 8.00% **
Class B-2 $8,214,000.00 8.00% **
Class B-3 $5,776,000.00 8.00% **
Class R $100.00 8.00% **
</TABLE>
* Approximate. They are based on the aggregate principal balance
of the Pooled Securities after giving effect to distributions
thereon on the Pooled Security Distribution Date for June
1999. The actual balances of the Certificates will be lower
than the amount indicated as a result of payments made on the
Pooled Securities on the Pooled Security Distribution Date for
July 1999, which will not be distributed to the Trust. Subject
to permitted variance in each case of plus or minus 5%.
** The Certificates are being offered by the Underwriters from
time to time in negotiated transactions or otherwise at
varying prices to be determined, in each case, at the time of
sale.
*** Component Principal Balance. The sum of the Component A-1-C
and Component A-2-C Principal Balance is equal to the Class A
Principal Balance.
(1) The Class A Certificates will be comprised of three components
having the characteristics described in the table above.
(2) The initial Component A-3-C notional amount will be
approximately
-2-
<PAGE>
$228,999.00.
-3-
<PAGE>
Certificate Rating:
The Class B-1, Class B-2 and Class B-3 Certificates will each
be rated "BBB" by Duff & Phelps Credit Rating Co. ("DCR"), and
the Class A Certificates and Class R Certificate will be rated
not less than "A-" by DCR.
REMIC Election:
The Company intends to cause the Pool to be treated as a
REMIC.
Credit Enhancement:
Senior/Subordinate structure.
Cut-off Date:
The Cut-off Date is June 25, 1999, although the distribution
received on the Pooled Security Distribution Date for July
1999 will not be distributed to the Trust.
Remittance Date:
The 2nd business day of each month after the 25th day of each
month, or if the 25th day is not a business day, the business
day immediately following commencing in August 1999.
Purchase Price:
The purchase price payable by the Underwriters for the
Certificates is 91.41% of the aggregate principal balance of
the Certificates as of the Closing Date. Payment of the
purchase price shall be made to the Company by delivery of the
Pooled Securities to the Company or its designee on or before
the Closing Date.
Underwriting Commission:
Notwithstanding anything to the contrary in the Underwriting
Agreement, no additional underwriting commission shall be
payable by the Company to the Underwriters in connection with
the purchase of the Certificates.
Information Provided by Underwriters:
-4-
<PAGE>
In addition to the information referred to in Section 6(b) of
the Underwriting Agreement, the information contained (i) in
Appendix V to the Prospectus Supplement and (ii) in the table
entitled "Sensitivity of Pre-Tax Yield to Maturity of the
Class A Certificates to Principal Prepayments at an Assumed
Purchase Price of 86.00%" under the caption "Prepayment and
Yield Considerations--Yield Considerations of the Class A
Certificates" in the Prospectus Supplement.
Monthly Remittance Report:
The monthly remittance report referred to in Section 10(k) of
the Underwriting Agreement shall be the monthly remittance
report for the June 25, 1999 distribution date on the
Underlying Certificates.
Payment of Expenses:
In addition to the expenses referred to in Section 5 of the
Underwriting Agreement, Donaldson, Lufkin & Jenrette
Securities Corporation will pay or cause to be paid a fee
relating to the establishment of the Company's shelf
registration equal to the product of 6/32 multiplied by the
aggregate principal balance of the Certificates.
Closing Date and Location:
July 30, 1999 at the Chicago, Illinois offices of Mayer, Brown
& Platt.
Classes To Be Listed on New York Stock Exchange:
Class B-2 and Class B-3 Certificates.
-5-
<PAGE>
Please confirm your agreement by having an authorized Officer
sign a copy of this Agreement in the space set forth below and returning a
signed copy to us.
DONALDSON, LUFKIN & JENRETTE
SECURITIES CORPORATION
By: /s/ Shannon Smith
----------------------------------
Name: Shannon Smith
Title: Senior Vice President
ABN AMRO INCORPORATED
By: /s/ Maria Fregosi
----------------------------------
Name: Maria Fregosi
Title: First Vice President
ACCEPTED:
ABN AMRO MORTGAGE CORPORATION
By: /s/ Stewart W. Fleming
------------------------------
Name: Stewart W. Fleming
Title: Senior Vice President
ABN AMRO NORTH AMERICA, INC.
By: /s/ Mark A. Nystuen
------------------------------
Name: Mark A. Nystuen
Title: Senior Vice President
By: /s/ Thomas C. Heagy
------------------------------
Name: Thomas C. Heagy
Title: Senior Vice President
<PAGE>
Exhibit I
<TABLE>
<CAPTION>
Original
Principal
Amount of
Name Certificates
- ---- ------------
<S> <C>
A $22,802,942.00
B-1 $10,960,000.00
B-2 $ 8,214,000.00
B-3 $ 5,776,000.00
R $ 100.00
--------------
TOTAL $47,753,042.00
==============
</TABLE>
-7-
<PAGE>
================================================================================
ABN AMRO MORTGAGE CORPORATION
Depositor
and
THE FIRST NATIONAL BANK OF CHICAGO
Trustee
----------------
POOLING AGREEMENT
Dated as of July 1, 1999
----------------
$47,753,042
Resecuritization Pass-Through Certificates
SERIES 1999-RS1
================================================================================
<PAGE>
TABLE OF CONTENTS
<TABLE>
<S> <C> <C>
PRELIMINARY STATEMENT..........................................................1
ARTICLE I DEFINITIONS......................................................3
ARTICLE II CONVEYANCE OF TRUST FUND;
ORIGINAL ISSUANCE OF CERTIFICATES...............................26
Section 2.1. Conveyance of Trust Fund.........................26
Section 2.2. Acceptance by Trustee............................27
Section 2.3. Representations and Warranties of the
Depositor.....................................28
Section 2.4. Authentication and Delivery of Certificates;
Designation of Certificates as REMIC
Regular and Residual Interests................29
Section 2.5. Designation of Startup Day.......................30
Section 2.6. No Contributions.................................30
Section 2.7. Substitution of Pooled Securities................30
ARTICLE III ADMINISTRATION OF THE POOLED SECURITIES.........................32
Section 3.1. Administration of the Trust and the Pooled
Securities....................................32
Section 3.2. Collection of Monies.............................32
Section 3.3. Establishment of the Certificate Account;
Deposits Therein..............................32
Section 3.4. Permitted Withdrawals From the Certificate
Account.......................................33
Section 3.5. Distributions....................................34
Section 3.6. Trustee Compensation.............................35
Section 3.7. Distribution Reports to the Trustee..............36
Section 3.8. Statements to Certificateholders.................36
Section 3.9. Access to Certain Documentation and Information..39
Section 3.10. Calculation of Amount to be Distributed..........39
Section 3.11. REMIC-Related Covenants..........................39
Section 3.12. Allocation of Loss Amounts.......................39
Section 3.13. Prohibited Transactions Taxes and Other Taxes....40
Section 3.14. Tax Administration...............................40
Section 3.15. Appointment of Paying Agent and Certificate
Administrator.................................41
Section 3.16. Equal Status of Trustee Fee......................42
Section 3.17. Maintenance of the Rounding Accounts;
Collections Thereunder........................42
</TABLE>
i
<PAGE>
<TABLE>
<S> <C> <C>
ARTICLE IV THE CERTIFICATES................................................43
Section 4.1. The Certificates.................................43
Section 4.2. Certificates Issuable in Classes; Distributions
of Principal and Interest; Authorized
Denominations.................................48
Section 4.3. Registration of Transfer and Exchange of
Certificates..................................48
Section 4.4. Mutilated, Destroyed, Lost or Stolen
Certificates..................................49
Section 4.5. Persons Deemed Owners............................49
Section 4.6. Temporary Certificates...........................50
Section 4.7. Book-Entry for Book-Entry Certificates...........50
Section 4.8. Notices to Clearing Agency.......................51
Section 4.9. Definitive Certificates..........................51
Section 4.10. Office for Transfer of Certificates..............52
ARTICLE V THE DEPOSITOR...................................................52
Section 5.1. Liability of the Depositor.......................52
Section 5.2. Merger or Consolidation of the Depositor.........52
Section 5.3. Limitation on Liability of the Depositor
and Others....................................53
ARTICLE VI CONCERNING THE TRUSTEE..........................................53
Section 6.1. Duties of Trustee................................53
Section 6.2. Certain Matters Affecting Trustee................55
Section 6.3. Trustee Not Required to Make Investigation.......56
Section 6.4. Trustee Not Liable for Certificates or
Pooled Securities.............................56
Section 6.5. Trustee May Own Certificates.....................57
Section 6.6. Indemnification of Trustee.......................57
Section 6.7. Eligibility Requirements for Trustee.............57
Section 6.8. Resignation and Removal of Trustee...............58
Section 6.9. Successor Trustee................................58
Section 6.10. Merger or Consolidation of Trustee...............59
Section 6.11. Appointment of Co-Trustee or Separate Trustee....59
Section 6.12. Appointment of Custodians........................60
Section 6.13. Authenticating Agent.............................60
Section 6.14. Third Party Data Providers.......................61
Section 6.15. Reports to Securities and Exchange Commission....61
ARTICLE VII TERMINATION.....................................................62
Section 7.1. Termination upon Purchase by the Depositor or
Liquidation of All Pooled Securities..........62
Section 7.2. Trusts Irrevocable...............................63
Section 7.3. Additional Termination Requirements..............63
</TABLE>
ii
<PAGE>
<TABLE>
<S> <C> <C>
ARTICLE VIII MISCELLANEOUS PROVISIONS........................................64
Section 8.1. Amendment........................................64
Section 8.2. Limitation on Rights of Certificateholders.......65
Section 8.3. Governing Law; Jurisdiction......................66
Section 8.4. Notices..........................................66
Section 8.5. Severability of Provisions.......................66
EXHIBITS
Exhibit A - Forms of Class A and Subordinate Certificates
Exhibit B - Form of Residual Certificate
Exhibit C - Schedule of Pooled Securities
Exhibit D - Form of Transferor Certificate
Exhibit E - Form of Transferee Affidavit and Agreement
Exhibit F - Form of Additional Matter Incorporated into the Form of the
Certificates
Exhibit G - Data Provider Data
</TABLE>
iii
<PAGE>
This Pooling Agreement, dated and effective as of July 1, 1999 (this
"Agreement"), is executed by and between ABN AMRO Mortgage Corporation, as
depositor (the "Depositor"), and The First National Bank of Chicago, as trustee
(the "Trustee"). Capitalized terms used in this Agreement and not otherwise
defined have the meanings ascribed to such terms in Article I hereof.
PRELIMINARY STATEMENT
The Depositor at the Closing Date is the owner of the Pooled Securities
and the other property being conveyed by it to the Trustee for inclusion in the
Trust Fund. On the Closing Date, the Depositor will acquire the Certificates
from the Trust Fund as consideration for its transfer to the Trust Fund of the
Pooled Securities and certain other assets and will be the owner of the
Certificates. The Depositor has duly authorized the execution and delivery of
this Agreement to provide for the conveyance to the Trustee of the Pooled
Securities and the issuance to the Depositor of the Certificates representing in
the aggregate the entire beneficial ownership of the Trust Fund. All covenants
and agreements made by the Depositor and the Trustee herein with respect to the
Pooled Securities and the other property constituting the Trust Fund are for the
benefit of the Holders from time to time of the Certificates. The Depositor is
entering into this Agreement, and the Trustee is accepting the trust created
hereby, for good and valuable consideration, the receipt and sufficiency of
which are hereby acknowledged.
The Certificates issued hereunder have been offered for sale pursuant to a
Prospectus, dated July 27, 1999, and a Prospectus Supplement, dated July 27,
1999, of the Depositor (together, the "Prospectus"). The Trust Fund created
hereunder is intended to be the "Trust" as described in the Prospectus and the
Certificates are intended to be the "Certificates" described therein.
As provided herein, the Trustee will elect to treat the segregated pool of
assets consisting of the Pooled Securities and other related assets in the Trust
Fund subject to this Agreement as a REMIC for federal income tax purposes, and
such segregated pool of assets will be designated as "REMIC I." Component R-1 of
the Class R Certificate will represent the sole class of "residual interests" in
REMIC I for purposes of the REMIC Provisions under federal income tax law.
As provided herein, the Trustee will elect to treat the segregated pool of
assets consisting of the REMIC I Regular Interests as a REMIC for federal income
tax purposes, and such segregated pool of assets will be designated as "REMIC
II". Component R-2 of the Class R Certificate will represent the sole class of
"residual interests" in REMIC II for purposes of the REMIC Provisions under
federal income tax law. The following table irrevocably sets forth the
designations, the Remittance Rate and initial Class Principal Balance for each
Class of Certificates which, together with the Class R-2 Component, constitute
the entire beneficial interests in REMIC II. Determined solely for purposes of
satisfying Treasury regulation section 1.860G-1(a)(4)(iii), the "latest possible
maturity date" for each of the REMIC I Regular Interests and for each Class of
Certificates shall be the first Distribution Date that is at least two years
after the latest final Pooled Security Distribution Date of the Pooled Security
that has, as of the Closing Date, the latest final Pooled Security Distribution
Date, irrespective of its scheduled final Pooled Security Distribution Date.
<PAGE>
The following table sets forth the designation, Remittance Rate, initial Class
Principal Balance, and Last Scheduled Distribution Date for each Class of
Certificates comprising the beneficial interests in REMIC II and the
Class R Certificate:
<TABLE>
<CAPTION>
Initial Class
Remittance Principal Last Scheduled
Designation Rate(1) Balance Distribution Date*
- ----------- --------- -------- ------------------
<S> <C> <C> <C>
Class A (2) $22,802,942 March 2029
Class B-1 8.00% 10,960,000 March 2029
Class B-2 8.00% 8,214,000 March 2029
Class B-3 8.00% 5,776,000 March 2029
Class R'D' 8.00% 100(3) March 2029
</TABLE>
* The Distribution Date in the month after the maturity date for the latest
maturing Pooled Security.
'D' The Class R Certificate is entitled to receive the Residual Distribution
Amount.
(1) Interest distributed to the Certificates (other than the Principal Only
Component) on each Distribution Date will have accrued during the
preceding calendar month at the applicable per annum Remittance Rate.
(2) For purposes of calculating distributions, the Class A Certificates will
be comprised of three Components having the designations, initial
Component Principal Balances and Remittance Rates set forth below:
<TABLE>
<CAPTION>
Initial Component Principal
Designation or Notional Balance Remittance Rate
----------- ------------------- ---------------
<S> <C> <C>
Component A-1-C $15,582,530 8.00%
Component A-2-C 7,220,412 0.00%(A)
Component A-3-C 228,999 8.00%(B)
</TABLE>
(A) Component A-2-C will not be entitled to distributions of
interest and will receive principal only in respect of certain
Pooled Securities.
(B) Component A-3-C will accrue interest on the Component A-3-C
Notional Amount and will not be entitled to receive
distributions of principal.
(3) The Class R Certificate will be comprised of two components, Component
R-1, which represents the sole residual interest in REMIC I (as defined
herein), and Component R-2, which represents the sole residual interest in
REMIC II (as defined herein).
2
<PAGE>
W I T N E S S E T H
In consideration of the mutual agreements herein contained, the Depositor
and the Trustee agree as follows:
ARTICLE I
DEFINITIONS
Whenever used herein, the following words and phrases, unless the context
otherwise requires, shall have the meanings specified in this Article:
Acquired Mortgage Asset: Any Underlying Mortgage Loan or related Mortgaged
Property acquired and to be serviced and administered on behalf and for the
benefit of the Trustee, as Pooled Securityholder, and the other holders of the
related Underlying Series, all in accordance with the related Underlying
Agreements.
Affiliate: With respect to any specified Person, any other Person
controlling or controlled by or under common control with such specified Person.
For the purposes of this definition, "control" when used with respect to any
specified Person means the power to direct the management and policies of such
Person, directly or indirectly, whether through the ownership of voting
securities, by contract or otherwise, and the terms "controlling" and
"controlled" have meanings correlative to the foregoing. The Trustee may obtain
and rely on an Officer's Certificate of the Depositor to determine whether any
Person is an Affiliate of such party.
Aggregate Certificate Principal Balance: At any given time, the sum of the
then current Class Principal Balances of all Classes of Certificates.
Agreement: This Pooling Agreement and all amendments and supplements
hereto.
Authenticating Agent: Any authenticating agent appointed by the Trustee
pursuant to Section 6.13.
Authorized Denomination: With respect to the Certificates (other than the
Class B-2 and Class B-3 Certificates and the Class R Certificate), an initial
Certificate Principal Balance equal to $25,000 each and integral multiples of $1
in excess thereof. The Class B-2 and Class B-3 Certificates are offered in
minimum denominations equivalent to at least $1,000 initial Certificate
Principal Balance each and multiples of $1,000 in excess thereof. With respect
to the Class R Certificate, one Certificate with a Percentage Interest equal to
100%.
3
<PAGE>
Available Funds: With respect to a Distribution Date, (i) the aggregate
amount on deposit in the Certificate Account for which both the Pooled Security
distribution and the related Pooled Security Distribution Date Information have
been received by the Trustee as of the immediately prior Pooled Security
Distribution Date and (ii) any amounts on deposit in the Certificate Account in
respect of the Class B-2 Rounding Amount or the Class B-3 Rounding Amount.
Beneficial Holder: A Person holding a beneficial interest in any
Book-Entry Certificate as or through a DTC Participant or an Indirect DTC
Participant or a Person holding a beneficial interest in any Definitive
Certificate.
Book-Entry Certificates: The Class A Certificates and the Class B
Certificates, beneficial ownership and transfers of which shall be made through
book entries as described in Section 4.7.
Business Day: Any day other than a Saturday, a Sunday, or a day on which
banking institutions in Chicago, Illinois or New York, New York are authorized
or obligated by law or executive order to be closed.
Certificate: Any one of the Certificates issued pursuant to this
Agreement, executed by the Trustee and authenticated by or on behalf of the
Trustee hereunder in substantially one of the forms set forth in Exhibits A and
B hereto. The additional matter appearing in Exhibit F shall be deemed
incorporated into Exhibits A and B as though set forth at the end of Exhibit A
and at the end of Exhibit B, as applicable.
Certificate Account: As defined in Section 3.3(a).
Certificate Adjustment Amount: means the aggregate amount of principal
payments received on the Pooled Securities in respect of the July Distribution,
which shall be allocated to the Certificates and Components in accordance with
the priorities set forth in the definition of "Certificate Distribution Amount."
Certificate Administrator: As defined in Section 3.15.
Certificate Distribution Amount: For any Distribution Date, the Available
Funds shall be distributed to the related Certificates and Components in the
following amounts and priority:
(A) First, as principal to Component A-2-C of the Class A Certificates,
the Discount Fractional Principal Amount;
(B) Second, to the Senior Certificates and Components, concurrently, the
sum of the Interest Distribution Amounts for such Classes and
Components of Certificates (other than the Principal Only Component)
remaining unpaid from previous Distribution Dates, pro rata
according to their respective shares of such unpaid amounts;
4
<PAGE>
(C) Third, to the Senior Certificates and Components, concurrently, the
sum of the Interest Distribution Amounts for such Certificates and
Components (other than the Principal Only Component) for the current
Distribution Date, pro rata according to their respective Interest
Distribution Amounts;
(D) Fourth, to the Subordinate Certificates, concurrently, the sum of
the Interest Distribution Amounts for such Certificates remaining
unpaid from previous Distribution Dates, pro rata according to their
respective shares of such unpaid amounts;
(E) Fifth, to the Subordinate Certificates, concurrently, the sum of the
Interest Distribution Amounts for such Certificates for the current
Distribution Date, pro rata according to their respective Interest
Distribution Amounts;
(F) Sixth, to the Senior Certificates and Components (other than
Component A-2-C and Component A-3-C), the Senior Principal Amount
for such Distribution Date as follows:
(i) first, to the Class R Certificate, until its Class Principal
Balance has been reduced to zero; and
(ii) second, to Component A-1-C of the Class A Certificates, until
the Component A-1-C Principal Balance has been reduced to
zero, the remaining Senior Principal Amount;
(G) Seventh, on each Distribution Date before the Credit Support
Depletion Date, to Component A-2-C up to the applicable Subordinate
Principal Amount (determined without regard to the proviso of such
definition) for such Distribution Date, the portion of the Discount
Fractional Principal Shortfall payable to Component A-2-C on
previous Distribution Dates pursuant to paragraph (H) below and
remaining unpaid from such previous Distribution Dates;
(H) Eighth, on each Distribution Date before the Credit Support
Depletion Date, to Component A-2-C up to the applicable Subordinate
Principal Amount (determined without regard to the proviso of such
definition) for such Distribution Date (less any amounts distributed
to Component A-2-C pursuant to paragraph (G) above), the Discount
Fractional Principal Shortfall for such Distribution Date, provided,
that any amounts distributed in respect of the Discount Fractional
Principal Shortfall pursuant to paragraph (G) above or this
paragraph (H) shall not cause a further reduction of the Component
A-2-C Component Principal Balance;
5
<PAGE>
(I) Ninth, sequentially, to the Class B-1 Certificates, the Class B-2
Certificates and the Class B-3 Certificates, in that order, an
amount up to the Subordinate Principal Amount for such Distribution
Date, until each of their Class Principal Balances have been reduced
to zero;
(J) Tenth, to the Senior Certificates, the amount of any unreimbursed
Loss Amounts previously allocated to such Class of Senior
Certificates, pro rata, based on the amount of unreimbursed Loss
Amounts previously allocated to each Class of Senior Certificates,
provided, that any amounts distributed in respect of unreimbursed
Loss Amounts pursuant to this paragraph (J) shall not cause a
further reduction in the Class Principal Balances of the Senior
Certificates;
(K) Eleventh, to the Subordinate Certificates, the amount of any
unreimbursed Loss Amounts previously allocated to each Class of
Subordinate Certificates, pro rata, based on the amount of
unreimbursed Loss Amounts previously allocated to each Class of
Subordinate Certificates, provided, that any amounts distributed in
respect of unreimbursed Loss Amounts pursuant to this paragraph (K)
shall not cause a further reduction in the Class Principal Balances
of the Subordinate Certificates; and
(L) Twelfth, to the Class R Certificate, the Residual Distribution
Amount for such Distribution Date.
Certificate Principal Balance: For each Certificate of any Class, the
portion of the related Class Principal Balance, if any, represented by such
Certificate.
Certificate Register and Certificate Registrar: The register maintained
and the registrar appointed, respectively, pursuant to Section 4.3. Initially,
the Certificate Registrar shall be The First National Bank of Chicago.
Certificateholder or Holder: The person in whose name a Certificate is
registered in the Certificate Register, except that, solely for the purposes of
giving any consent pursuant to this Agreement, any Certificate registered in the
name of the Depositor, the Certificate Administrator or any Affiliate thereof
shall be deemed not to be outstanding and the Percentage Interest evidenced
thereby shall not be taken into account in determining whether the requisite
percentage of Percentage Interests necessary to effect any such consent has been
obtained; provided, that the Trustee, the Certificate Registrar and the Paying
Agent may conclusively rely upon an Officer's Certificate to determine whether
any Person is an Affiliate of the Depositor or the Certificate Administrator.
Certificateholders' Report: As defined in Section 3.8(a).
6
<PAGE>
Class: All Certificates having the same priority and rights to payments
from the applicable Available Distribution Amount, designated as a separate
Class, as set forth in the forms of Certificates attached hereto as Exhibits A
and B.
Class A Certificates: The Class A Certificates, designated as such on the
face thereof in substantially the form attached hereto as Exhibits A-1.
Class B Certificates: The Class B-1, Class B-2 and Class B-3 Certificates
collectively, and designated as such on the face thereof in substantially the
forms attached hereto as Exhibits A-2 through A-4, respectively.
Class B-2 Rounding Account: The separate trust account established by the
deposit as of the Closing Date of $999.99 and maintained by the Trustee pursuant
to Section 3.17, which account shall bear a designation clearly indicating that
the funds deposited therein are held in trust for the benefit of the Trustee on
behalf of the Class B-2 Certificateholders, or any other account serving a
similar function acceptable to the Rating Agency, and which account provides
that the Trustee may make, or cause to be made, withdrawals as provided in
Section 3.17 hereof.
Class B-2 Rounding Amount: On any Distribution Date, the amount necessary
to round the amount of any principal distributions to the Class B-2 Certificates
on such Distribution Date upward to the next higher integral multiple of an
amount equal to the excess of (a) $1,000, minus (b) the portion of the aggregate
Loss Amount allocated to the Class B-2 Certificates on any prior Distribution
Date and the Loss Amount allocated to the Class B-2 Certificates on such
Distribution Date, expressed as an amount per $1,000 of Certificate Principal
Balance.
Class B-3 Rounding Account: The separate trust account established by the
deposit as of the Closing Date of $999.99 and maintained by the Trustee pursuant
to Section 3.17, which account shall bear a designation clearly indicating that
the funds deposited therein are held in trust for the benefit of the Trustee on
behalf of the Class B-3 Certificateholders, or any other account serving a
similar function acceptable to the Rating Agency, and which account provides
that the Trustee may make, or cause to be made, withdrawals as provided in
Section 3.17 hereof.
Class B-3 Rounding Amount: On any Distribution Date, the amount necessary
to round the amount of any principal distributions to the Class B-3 Certificates
on such Distribution Date upward to the next higher integral multiple of an
amount equal to the excess of (a) $1,000, minus (b) the portion of the aggregate
Loss Amount allocated to the Class B-3 Certificates on any prior Distribution
Date and the Loss Amount allocated to the Class B-3 Certificates on such
Distribution Date, expressed as an amount per $1,000 of Certificate Principal
Balance.
Class Principal Balance: For any Class of Certificates (other than the
Class A Certificates) the applicable initial Class Principal Balance set forth
in the Preliminary Statement hereto,
7
<PAGE>
corresponding to the rights of such Class in payments of principal due to be
passed through to Certificateholders from principal payments on the Pooled
Securities, as reduced from time to time by (x) the Certificate Adjustment
Amount, (y) distributions of principal to Certificateholders of such Class and
(z) the portion of Loss Amounts allocated to the Class Principal Balance of such
Class pursuant to Section 3.12 with respect to a given Distribution Date. As of
the Closing Date, the Class Principal Balance of any Class of Certificates shall
be reduced pursuant to the definition of "Certificate Adjustment Amount." For
any Distribution Date, the reduction of the Class Principal Balance of any Class
of Certificates pursuant to Section 3.12 shall be deemed effective prior to the
determination and distribution of principal on such Class pursuant to the
definition of "Certificate Distribution Amount". The Class Principal Balance for
the Class B-1 Certificates shall be referred to as the "Class B-1 Principal
Balance", the Class Principal Balance for the Class B-2 Certificates shall be
referred to as the "Class B-2 Principal Balance" and so on.
Class R Certificate: The Certificate designated as "Class R" on the face
thereof in substantially the form attached hereto as Exhibit B, that is composed
of Components R-1 and R-2, each of which has been designated as the sole class
of "residual interests" in the REMIC I and REMIC II, respectively, pursuant to
Section 2.1.
Class R Certificateholder: The registered Holder of the Class R
Certificate.
Clearing Agency: An organization registered as a "clearing agency"
pursuant to Section 17A of the Securities and Exchange Act of 1934, as amended,
which initially shall be DTC.
Closing Date: July 30, 1999, which is the date of settlement of the sale
of the Certificates to the initial purchasers thereof.
Code: The Internal Revenue Code of 1986, as amended.
Component: A portion of the Class A Certificates representing parts of the
entitlement of such Class to principal and/or interest as described in the
Preliminary Statement hereto and the remainder of this Agreement and hereafter
referred to as Component A-1-C, A-2-C and A-3-C.
Component A-3-C Notional Amount: As of the Closing Date, approximately
$228,999, and thereafter, with respect to any Distribution Date will equal to
the sum of:
(a) with respect to the Premium Pooled Security:
8
<PAGE>
<TABLE>
<S> <C> <C>
(Pass-Through Rate (the current Principal
of the Premium x Balance of the
Pooled Security Premium Pooled
minus 8.00%) Security)
---------------------------------------------------------
8.00%
plus
</TABLE>
(b) with respect to DLJ 1998-2:
<TABLE>
<S> <C> <C>
(the current (the current Principal
Pass-Through Rate x Balance of
of DLJ 1998-2 DLJ 1998-2)
minus 6.80%)
---------------------------------------------------------
8.00%
plus
</TABLE>
(c) with respect to PNC 1998-14:
<TABLE>
<S> <C> <C>
(the current (the current Principal
Pass-Through Rate x Balance of
of PNC 1998-14 PNC 1998-14)
minus 6.50%)
---------------------------------------------------------
8.00%
plus
</TABLE>
(d) with respect to PNC 1998-6:
<TABLE>
<S> <C> <C>
(the current (the current Principal
Pass-Through Rate x Balance of
of PNC 1998-6 PNC 1998-6)
minus 6.50%)
---------------------------------------------------------
8.00%
</TABLE>
Component Notional Amount: With respect to Component A-3-C, the Component
A-3-C Notional Amount.
Component Principal Balance: For Components A-1-C and A-2-C of the Class A
Certificates, the applicable initial Component Principal Balance therefor set
forth in the Preliminary Statement hereto, corresponding to the rights of such
Component in payments of principal due to be passed through to the holders of
the Class A Certificates from principal payments on the Pooled Securities, as
reduced from time to time by (x) the Certificate Adjustment Amount in respect of
such
9
<PAGE>
Component, (y) distributions of principal to the holders of the Class A
Certificates in respect of such Component and (z) the portion of Loss Amounts
allocated to the Component Principal Balance in respect of such Component
pursuant to Section 3.12 with respect to a given Distribution Date. As of the
Closing Date, the Component Principal Balance of any Component shall be reduced
pursuant to the definition of "Certificate Adjustment Amount." For any
Distribution Date, the reduction of the Component Principal Balance of any
Component pursuant to the definition of "Loss Amount" shall be deemed effective
prior to the determination and distribution of principal on such Component
pursuant to the definition of "Certificate Distribution Amount." Notwithstanding
the foregoing, any amounts distributed in respect of losses pursuant to
paragraphs (G) or (H) of the definition of "Certificate Distribution Amount"
shall not cause a further reduction in the Component A-2-C Component Principal
Balance. The Component Principal Balance for Component A-1-C shall be referred
to as the "Component A-1-C Principal Balance" and the Component Principal
Balance for Component A-2-C shall be referred to as the "Component A-2-C
Principal Balance." The Component Principal Balance of the Interest Only
Component shall be zero.
Component R-1: The component R-1 of the Class R Certificate, which shall
represent the sole class of "residual interests" in REMIC I.
Component R-2: The component R-2 of the Class R Certificate, which shall
represent the sole class of "residual interests" in REMIC II.
Corporate Trust Office: The corporate trust office of the Trustee in the
State of Illinois, 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 One First National Plaza, Suite
IL1-0126, Chicago, Illinois 60670-0126, Attention: Global Corporate Trust
Services, and for purposes of Section 4.10, such office is located at 14 Wall
Street, 8th Floor, New York, New York 10005.
Credit Support Depletion Date: The first Distribution Date on which the
aggregate of the Class Principal Balances of the Subordinate Certificates has
been or will be reduced to zero as a result of principal distributions thereon
and the allocation of Loss Amounts on such Distribution Date.
Custodial Agreement: The agreement, if any, among the Trustee and a
Custodian providing for the safekeeping of the Pooled Securities on behalf of
the Certificateholders.
Custodian: A custodian which is appointed pursuant to a Custodial
Agreement. Any Custodian so appointed shall act as agent on behalf of the
Trustee, and shall be compensated by the Trustee. The Trustee shall remain at
all times responsible under the terms of this Agreement, notwithstanding the
fact that certain duties have been assigned to a Custodian.
Cut-Off Date: July 26, 1999.
10
<PAGE>
Data: As defined in Section 6.14.
DCR: Duff & Phelps Credit Rating Co.
Defective Pooled Security: Any Pooled Security subject to repurchase or
substitution by the Depositor pursuant to Section 2.3 or Section 2.7.
Definitive Certificates: As defined in Section 4.7.
Denomination: The amount specified on a Certificate as representing the
aggregate Pooled Security Information Date Principal Balance evidenced by such
Certificate.
Depositary Agreement: The Letter of Representations, dated July 27, 1999
by and among DTC, the Depositor and the Trustee.
Depositor: ABN AMRO Mortgage Corporation, a Delaware corporation, or its
successor-in-interest.
Depository: DTC or any successor thereto.
Discount Fraction: The Discount Pooled Security Discount Fraction, DLJ
1998-2 Discount Fraction, PNC 1998-6 Discount Fraction or PNC 1998-14 Discount
Fraction, as applicable.
Discount Fractional Principal Amount: For any Distribution Date, an amount
equal to the sum of the following amounts:
(a) with respect to each Discount Pooled Security, the Discount
Pooled Security Discount Fraction of the amount of principal received as
of the immediately preceding Pooled Security Distribution Date in respect
of such Discount Pooled Security;
(b) with respect to DLJ 1998-2, the DLJ 1998-2 Discount Fraction of
the amount of principal received as of the immediately preceding Pooled
Security Distribution Date in respect of DLJ 1998-2;
(c) with respect to PNC 1999-6, the PNC 1998-6 Discount Fraction of
the amount of principal received as of the immediately preceding Pooled
Security Distribution Date in respect of PNC 1998-6; and
(d) with respect to PNC 1998-14, the PNC 1998-14 Discount Fraction
of the amount of principal received as of the immediately preceding Pooled
Security Distribution Date in respect of PNC 1998-14.
11
<PAGE>
Discount Fractional Principal Shortfall: For any Distribution Date, an
amount equal to the sum of the following amounts:
(a) with respect to each Discount Pooled Security, the Discount
Pooled Security Discount Fraction of any principal loss
allocated to such Discount Pooled Security on such
Distribution Date;
(b) with respect to DLJ 1999-2, the DLJ 1998-2 Discount Fraction
of any principal loss allocated to DLJ 1998-2 on such
Distribution Date;
(c) with respect to PNC 1998-6, the PNC 1998-6 Discount Fraction
of any principal loss allocated to PNC 1998-6 on such
Distribution Date; and
(d) with respect to PNC 1998-14, the PNC 1998-14 Discount Fraction
of any principal loss allocated to PNC 1998-14 on such
Distribution Date;
Discount Pooled Security: The Pooled Securities having Pass-Through Rate
of less than 8.00% per annum.
Discount Pooled Security Discount Fraction: For each Discount Pooled
Security, the following fraction:
8.00% minus the Pass-Through Rate on such Discount Pooled Security
------------------------------------------------------------------
8.00%
Disqualified Organization: As defined in Section 5.1(b).
Distribution Date: With respect to distributions on the Certificates, the
2nd Business Day (or, if such 2nd day is not a Business Day, the Business Day
immediately succeeding such 2nd day) after the 25th day (or, if such 25th day is
not a Business Day, the Business Day immediately succeeding such 25th day) of
each month, with the first such date being August 27, 1999.
DLJ 1998-2: DLJ Mortgage Acceptance Corp., Mortgage Pass-Through
Certificates, Series 1998-2, Class C-B-3.
DLJ 1998-2 Discount Fraction: With respect to DLJ 1998-2, 15.625%.
DTC: The Depository Trust Company.
DTC Participant: A broker, dealer, bank, other financial institution or
other Person for whom DTC effects book-entry transfers and pledges of securities
deposited with DTC.
12
<PAGE>
Eligible Account: Any account or accounts held and established by the
Trustee in trust for the Certificateholders at any Eligible Institution.
Eligible Institution: An institution having (i) the highest short-term
debt rating, and one of the two highest long-term debt ratings of the Rating
Agency, or (ii) the approval of the Rating Agency.
Eligible Investments: Any one or more of the following obligations or
securities payable on demand or having a scheduled maturity on or before the
Business Day preceding the following Distribution Date, regardless of whether
issued by the Depositor, the Trustee or any of their respective Affiliates and
having at the time of purchase, or at such other time as may be specified, the
required ratings, if any, provided for in this definition:
(a) direct obligations of, or guaranteed as to full and timely payment of
principal and interest by, the United States or any agency or instrumentality
thereof, provided, that such obligations are backed by the full faith and credit
of the United States of America;
(b) direct obligations of, or guaranteed as to timely payment of principal
and interest by, FHLMC, FNMA or the Federal Farm Credit System, provided, that
any such obligation, at the time of purchase or contractual commitment providing
for the purchase thereof, is qualified by the Rating Agency as an investment of
funds backing securities rated "AAA";
(c) demand and time deposits in or certificates of deposit of, or bankers'
acceptances issued by, any bank or trust company, savings and loan association
or savings bank, provided, that the short-term deposit ratings and/or long-term
unsecured debt obligations of such depository institution or trust company (or
in the case of the principal depository institutions in a holding company
system, the commercial paper or long-term unsecured debt obligations of such
holding company) have, in the case of commercial paper, the highest rating
available for such securities by the Rating Agency and, in the case of long-term
unsecured debt obligations, one of the two highest ratings available for the
securities by the Rating Agency, or in each case such lower rating as will not
result in the downgrading or withdrawal of the rating or ratings then assigned
to any Class of Certificates by the Rating Agency;
(d) general obligations of or obligations guaranteed by any state of the
United States or the District of Columbia receiving one of the two highest
long-term debt ratings available for such securities by the Rating Agency, or
such lower rating as will not result in the downgrading or withdrawal of the
rating or ratings then assigned to any Class of Certificates by the Rating
Agency;
(e) commercial or finance company paper (including both
non-interest-bearing discount obligations and interest-bearing obligations
payable on demand or on a specified date not more than one year after the date
of issuance thereof) that is rated by the Rating Agency in its highest
short-term unsecured rating category at the time of such investment or
contractual commitment providing for such investment, and is issued by a
corporation the outstanding senior long-term debt obligations of which
13
<PAGE>
are then rated by the Rating Agency in one of its two highest long-term
unsecured rating categories, or such lower rating as will not result in the
downgrading or withdrawal of the rating or ratings then assigned to any Class of
Certificates by the Rating Agency;
(f) guaranteed reinvestment agreements issued by any bank, insurance
company or other corporation rated in one of the two highest rating levels
available to such issuers by the Rating Agency at the time of such investment,
provided, that any such agreement must by its term provide that it is terminable
by the purchaser without penalty in the event any such rating is at any time
lower than such level;
(g) repurchase obligations with respect to any security described in
clause (a) or (b) above entered into with a depository institution or trust
company (acting as principal) meeting the rating standards described in (c)
above;
(h) securities bearing interest or sold at a discount that are issued by
any corporation incorporated under the laws of the United States of America or
any State thereof and rated by the Rating Agency in one of its two highest
long-term unsecured rating categories at the time of such investment or
contractual commitment providing for such investment; provided, however, that
securities issued by any such corporation will not be Eligible Investments to
the extent that investment therein would cause the outstanding principal amount
of securities issued by such corporation that are then held as part of the
Certificate Account to exceed 20% of the aggregate principal amount of all
Eligible Investments then held in the Certificate Account;
(i) units of taxable money market funds (including those for which the
Trustee or any affiliate thereof receives compensation with respect to such
investment) which funds have been rated by the Rating Agency in its highest
rating category or which have been designated in writing by the Rating Agency as
Eligible Investments with respect to this definition;
(j) if previously confirmed in writing to the Trustee, any other demand,
money market or time deposit, or any other obligation, security or investment,
as may be acceptable to the Rating Agency as a permitted investment of funds
backing securities rated "AAA"; and
(k) such other obligations as are acceptable as Eligible Investments to
the Rating Agency;
provided, however, that such instrument continues to qualify as a "cash flow
investment" pursuant to Code Section 860G(a)(6) and that no instrument or
security shall be an Eligible Investment if (i) such instrument or security
evidences a right to receive only interest payments or (ii) the right to receive
principal and interest payments derived from the underlying investment provides
a yield to maturity in excess of 120% of the yield to maturity at par of such
underlying investment.
ERISA: The Employee Retirement Income Security Act of 1974, as amended.
14
<PAGE>
Exchange Act: The Securities Exchange Act of 1934, as amended.
FHLMC: Federal Home Loan Mortgage Corporation, or any successor thereto.
FNMA: Federal National Mortgage Association, or any successor thereto.
Independent: When used with respect to any specified Person, any such
Person who (i) is in fact independent of the Depositor, (ii) does not have any
direct financial interest or any material indirect financial interest in the
Depositor or any Affiliate of either and (iii) is not connected with the
Depositor as an officer, employee, promotor, underwriter, trustee, partner,
director or person performing similar functions.
Indirect DTC Participants: Entities such as banks, brokers, dealers or
trust companies, that clear through or maintain a custodial relationship with a
DTC Participant, either directly or indirectly.
Interest Distribution Amount: On any Distribution Date, for any Class or
Component of Certificates (other than the Principal Only Component), the amount
of interest accrued on the respective Class or Component Principal Balance or
Component Notional Amount, as applicable, at 1/12th of the related Remittance
Rate for such Class or Component, before giving effect to the allocations of
Loss Amounts or distributions to be made on such Distribution Date, reduced by
Pooled Security Interest Shortfall pursuant to the definition of "Pooled
Security Interest Shortfall". The Interest Distribution Amount for the Principal
Only Components on any Distribution Date shall equal zero.
Interest Only Component: Component A-3-C, which will not be entitled to
receive principal.
Interested Person: The Depositor, any Holder of a Certificate, or any
Affiliate of any such Person.
July Distribution: With respect to each Pooled Security, the Pooled
Security distribution scheduled to be paid on July 26, 1999, whether or not paid
on such date.
Loans: One- to four-family, conventional, fixed-rate, first lien mortgage
loans or cooperative loans secured by shares in cooperative corporations.
Loss Amount: With respect to any Distribution Date, an amount equal to the
greater of (a) zero and (b) an amount equal to the excess of (i) the aggregate
outstanding principal balance of the Certificates after giving effect to all
distributions on such date, minus (ii) the aggregate Pooled Security
Distribution Date Principal Balance of the Pooled Securities immediately
following the immediately preceding Pooled Security Distribution Date.
15
<PAGE>
Majority Class Certificateholders: For any Class, the Holders of
Certificates evidencing in the aggregate greater than 50% of the aggregate
Percentage Interests of all the Certificates of such Class.
Monthly Payment: The scheduled payment of principal and interest on an
Underlying Mortgage Loan which is due on the related due date for such
Underlying Mortgage Loan.
Mortgage: The mortgage, deed of trust or other instrument securing a
Mortgage Note.
Mortgage Loan Information Date: June 1, 1999.
Mortgage Note: The note or other evidence of indebtedness evidencing the
indebtedness of a Mortgagor under a Loan.
Mortgaged Property: The real property, together with improvements thereto,
or the shares of cooperative corporations securing the indebtedness of the
Mortgagor under a Mortgage.
Mortgagor: The obligor on a Mortgage Note.
Non-U.S. Person: A Person that is not a U.S. Person.
Notice of Final Distribution: With respect to the Pooled Securities, any
notice provided pursuant to the related Underlying Agreement to the effect that
final distribution on a Pooled Security shall be made only upon presentment and
surrender thereof. With respect to a Class of Certificates, the notice to be
provided pursuant to Section 7.1 to the effect that final distribution on such
Class of Certificates shall be made only upon presentment and surrender thereof.
Officer's Certificate: With respect to any Person, a certificate signed by
the Chairman of the Board, the President or a Vice President of such Person (or,
in the case of a Person which is not a corporation, signed by the person or
persons having like responsibilities), and delivered to the Trustee.
Opinion of Counsel: A written opinion of counsel, who may be outside or
salaried counsel for the Depositor, or any Affiliate of the Depositor,
acceptable to the Trustee; provided, that with respect to REMIC matters, matters
relating to the determination of Eligible Accounts or matters relating to
transfers of Certificates, such counsel shall be Independent.
Other Pooled Security Distribution Date Information: With respect to any
Pooled Security Distribution Date and the related Pooled Security for which a
Pooled Security Distribution Date Statement has not been received by the Trustee
as of the close of business on such Pooled Security Distribution Date,
information obtained by the Trustee by such means as the Trustee deems reliable,
including by telephone, fax or other electronic means, constituting all
information with respect to such
16
<PAGE>
Pooled Security necessary to calculate the distribution to be made on the
Certificates with respect to such Pooled Security.
Ownership Interest: As defined in Section 4.1(b).
Pass-Through Entity: As defined in Section 4.1(b).
Pass-Through Rate: For each Pooled Security, a rate equal to the Pooled
Security Interest Rate for such Pooled Security less the applicable per annum
percentage rate of the Trustee Fee.
Paying Agent: As defined in Section 3.15.
Percentage Interest: (a) With respect to the right of each Certificate of
a particular Class in the distributions allocated to such Class, "Percentage
Interest" shall mean the percentage undivided beneficial ownership interest
evidenced by such Certificate of such Class, which percentage shall equal:
(i) with respect to any Regular Interest Certificate, its
Certificate Principal Balance divided by the applicable Class Principal
Balance; and
(ii) with respect to the Class R Certificate, the percentage set
forth on the face of such Certificate.
(b) With respect to the rights of each Certificate in connection with
Sections 4.9, 6.3, 6.8 and 8.1, "Percentage Interest" shall mean the percentage
undivided beneficial interest evidenced by such Certificate in the Trust Fund,
which for purposes of such rights only shall equal:
(i) with respect to any Certificate the percentage calculated by
dividing its Certificate Principal Balance by the Aggregate Certificate
Principal Balance; and
(ii) with respect to the Class R Certificate, zero.
Permitted Transferee: With respect to the holding or ownership of any
Residual Certificate, any Person other than (i) the United States, a State or
any political subdivision thereof, or any agency or instrumentality of any of
the foregoing, (ii) a foreign government or 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 the taxes imposed by Chapter 1 of the Code (unless such organization
is subject to the tax imposed by Section 511 of the Code on unrelated business
taxable income), (iv) rural electric and telephone cooperatives described in
Code Section 1381(a)(2)(C), (v) any electing large partnership under Section 775
of the Code, (vi) any other Person from whom the Trustee or the Certificate
Registrar has not received an affidavit to the effect that it is not a
"disqualified organization" within the meaning of Section 860E(e)(5) of
the Code, and (vii) any
17
<PAGE>
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 Trust Fund 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 Code Section
7701 or successor provisions. A corporation shall 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, limited liability company,
partnership, joint venture, association, joint-stock company, trust,
unincorporated organization or government or any agency or political subdivision
thereof.
Plan: As defined in Section 4.1(d)(i).
PNC 1998-6: PNC Mortgage Securities Corp., Mortgage Pass-Through
Certificates, Series 1998-6, Class C-B-3.
PNC 1998-6 Discount Fraction: With respect to PNC 1998-6, 19.375%.
PNC 1998-14: PNC Mortgage Securities Corp., Mortgage Pass-Through
Certificates, Series 1998-14, Class D-B-3.
PNC 1998-14 Discount Fraction: With respect to PNC 1998-14, 19.375%.
Pooled Security: The 20 mortgage-backed securities sold by the Depositor
to, and registered in the name of or held for the benefit of, the Trustee
pursuant to Section 2.1 or Section 2.7 and as more particularly set forth on
Exhibit C attached hereto as it may be amended from time to time (excluding from
and after the respective date of substitution or repurchase any Defective Pooled
Securities and including from and after the date of substitution any Substituted
Pooled Securities).
Pooled Security Credit Support: With respect to each Pooled Security the
amount of credit support for such Pooled Security, expressed as the percentage
that such credit support, if any, represents of the aggregate outstanding
principal balance of the Underlying Mortgage Loans with respect to such Pooled
Security as of any Pooled Security Distribution Date.
Pooled Security Distribution Date: With respect to each Pooled Security,
the 25th day (or, if such 25th day is not a Business Day, the Business Day
immediately succeeding such 25th day) of each month.
Pooled Security Distribution Date Information: With respect to any Pooled
Security for which the related Pooled Security Distribution Date Statement is
available on any Pooled Security
18
<PAGE>
Distribution Date, such Pooled Security Distribution Date Statement, and with
respect to any Pooled Security for which the related Pooled Security
Distribution Date Statement is not available on any Pooled Security Distribution
Date, the related Other Pooled Security Distribution Date Information.
Pooled Security Distribution Date Statement: Each report provided monthly
to holders of Pooled Securities in connection with each Pooled Security
Distribution Date pursuant to the related Underlying Agreement.
Pooled Security Distribution Date Principal Balance: As of any Pooled
Security Distribution Date with respect to any Pooled Security, the Pooled
Security Information Date Principal Balance of such Pooled Security reduced by
all principal payments received by the Trustee in respect of such Pooled
Security (other than principal payments received in respect of the July
Distribution) since the Pooled Security Information Date for which both the
Pooled Security distribution and the related Pooled Security Date Information
have been received by the Trustee as of such Pooled Security Distribution Date.
Pooled Security Information Date: With respect to each Pooled Security,
the related June 1999 Pooled Security Distribution Date.
Pooled Security Information Date Principal Balance: With respect to any
Pooled Security, the principal balance of such Pooled Security remaining to be
paid as of the close of business on the Pooled Security Information Date after
deduction of all principal payments paid in respect of such Pooled Security
(without duplication) (i) on or before such date and (ii) in respect of the July
Distribution.
Pooled Security Interest Rate: For any Pooled Security, the stated
interest rate payable on such Pooled Security, as indicated in the related
Pooled Security Distribution Date Information.
Pooled Security Interest Shortfall: For any Distribution Date, the
aggregate amount of Uncollected Interest with respect to the Pooled Securities
as of the related Pooled Security Distribution Date, which shall be allocated to
each Class of Certificates and Components (other than the Principal Only
Component) pro rata according to the amount of interest accrued thereon in
reduction thereof.
Pooled Security Schedule: The schedule, as amended from time to time, of
Pooled Securities attached hereto as Exhibit C, which shall set forth as to each
Pooled Security the following, among other things:
(i) the issuer name;
(ii) the series;
19
<PAGE>
(iii) the class;
(iv) the current trustee;
(v) the original principal balance;
(vi) the Pooled Security Information Date Principal Balance;
(vii) the pass-through rate as of the Pooled Security Information Date;
and
(viii) the rating as of the Pooled Security Information Date.
Pooled Securityholder: With respect to Pooled Securities in physical form,
the registered holder of the Pooled Securities, which following the execution
and delivery of this Agreement by the parties hereto and registration on the
books of the applicable trustee with respect to the Underlying Series, shall be
the Trustee for the benefit of the Certificateholders and with respect to Pooled
Securities in book-entry form, the Trustee or its DTC Participant for the
benefit of the Certificateholders.
Premium Pooled Security: The Pooled Security with a Pass-Through Rate
greater than 8.00% per annum.
Prepaid Monthly Payment: Any payment on an Underlying Mortgage Loan
received prior to its scheduled due date, which is intended to be applied to the
Underlying Mortgage Loan on its scheduled due date.
Prepayment: Any payment on an Underlying Mortgage Loan, made by or on
behalf of the related Mortgagor, other than a Monthly Payment or a Prepaid
Monthly Payment.
Prepayment Interest Shortfall: With respect to any Prepayment, any
shortfall in the amount of interest collected in respect of the related
Underlying Mortgage Loan as a result of such Prepayment, less any amounts
advanced by the related servicer in respect of such Prepayment under the terms
of the related Underlying Agreement.
Principal Balance: At the time of any determination, the Pooled Security
Information Date Principal Balance of a Pooled Security reduced by all principal
payments received by the Trustee in respect of such Pooled Security (other than
principal payments received in respect of the July Distribution) since the
Pooled Security Information Date.
Principal Only Component: Component A-2-C of the Class A Certificate.
20
<PAGE>
Principal Payment Amount: On any Distribution Date, the sum of (i) the
principal payments on the Pooled Securities received on the immediately
preceding Pooled Security Distribution Date, and (ii) any other payments of
principal which were received on the Pooled Securities since the second
immediately preceding Pooled Security Distribution Date.
Pro Rata Allocation: The allocation of the principal portion of losses
relating to a Pooled Security to the Senior Certificates (other than the
Principal Only Component and Interest Only Component) or to the Subordinate
Certificates, as applicable, pro rata according to their outstanding Class
Principal Balances or Component Principal Balances (except if the loss is
recognized with respect to DLJ 1998-2, PNC 1998-6, PNC 1998-14 or a Discount
Pooled Security, in which event the related Discount Fraction of such loss will
first be allocated to the Principal Only Component and the remainder of such
loss will be allocated as described above in this definition without regard to
this parenthetical) in reduction thereof.
Purchase Obligation: An obligation of the Depositor to repurchase Pooled
Securities under the circumstances and in the manner provided in Section 2.2 or
Section 2.3.
Purchase Price: With respect to any Pooled Security to be purchased
pursuant to a Purchase Obligation, an amount equal to the sum of the Principal
Balance thereof, plus accrued and unpaid interest thereon, if any, to the last
day of the calendar month in which the date of repurchase occurs at a rate equal
to the applicable Pass-Through Rate; provided, however, that no Pooled Security
shall be purchased or required to be purchased pursuant to Section 2.3, or more
than two years after the Closing Date, unless (a) the Pooled Security to be
purchased is in default, or default is in the judgment of the Depositor
reasonably imminent, or (b) the Depositor, at its expense, delivers to the
Trustee an Opinion of Counsel to the effect that the purchase of such Pooled
Security will not give rise to a tax on a prohibited transaction, as defined in
Section 860F(a) of the Code; provided, further, that in the case of clause (b)
above, the Depositor will use its reasonable efforts to obtain such Opinion of
Counsel if such opinion is obtainable.
Random Lot: With respect to any Distribution Date on which a distribution
is to be made on any Class B-2 or Class B-3 Certificate (as described in Section
3.5(d)), the method by which the Depository will determine which Class B-2 or
Class B-3 Certificate will be paid principal, using its established random lot
procedures or, if such Certificates are no longer represented by a Book-Entry
Certificate, using the Paying Agent's, or if no Paying Agent has been appointed
hereunder, the Trustee's procedures.
Rating Agency: Initially, DCR and thereafter, each nationally recognized
statistical rating organization that has rated the Certificates at the request
of the Depositor, or their respective successors in interest.
21
<PAGE>
Ratings: As of any date of determination, the ratings, if any, of the
Certificates as assigned by each Rating Agency.
Realized Loss: A loss incurred on a defaulted Underlying Mortgage Loan, as
reported on the related Pooled Security Distribution Date Statement.
Record Date: The last Business Day of the month immediately preceding the
month of the related Distribution Date.
Regular Interest Certificates: The Certificates, other than the Class R
Certificate.
REMIC: A real estate mortgage investment conduit, as such term is defined
in the Code.
REMIC I: The pool of assets consisting of the Trust Fund.
REMIC I Regular Interests: The regular interests in REMIC I as described
in Section 2.4 of this Agreement.
REMIC II: The pool of assets consisting of the REMIC I Regular Interests
and all payments of principal or interest on or with respect to the REMIC I
Regular Interests after the Pooled Security Information Date.
REMIC Opinion: As defined in Section 2.7(d).
REMIC Provisions: Sections 860A through 86OG of the Code, related Code
provisions and regulations promulgated thereunder, as the foregoing may be in
effect from time to time.
Remittance Rate: For each Class of Certificates or Components, the per
annum rate set forth as the Remittance Rate for such Class or Component in the
Preliminary Statement hereto.
Residual Certificate: The Class R Certificate, which is being issued in a
single class. Components R-1 and R-2 of the Class R Certificate is hereby each
designated the sole Class of "residual interests" in REMIC I and REMIC II,
respectively, for purposes of Section 860G(a)(2) of the Code.
Residual Distribution Amount: On any Distribution Date, any portion of the
Available Funds remaining after all distributions to the Certificates pursuant
to the definition of Certificate Distribution Amount. Upon termination of the
obligations created by this Agreement and the Trust Fund created hereby, the
amounts which remain on deposit in the Certificate Account after payment to the
Certificateholders of the amounts set forth in Section 7.1 of this Agreement,
and subject to the conditions set forth therein.
22
<PAGE>
Responsible Officer: When used with respect to the Trustee, the Chairman
or Vice-Chairman of the Board of Directors or Trustees, the Chairman or
Vice-Chairman of the Executive or Standing Committee of the Board of Directors
or Trustees, the President, the Chairman of the Committee on Trust Matters, any
Vice-President, any Assistant Vice President, the Secretary, any Assistant
Secretary, the Treasurer, any Assistant Treasurer, the Cashier, any Assistant
Cashier, any Trust Officer or Assistant Trust Officer, the Controller, any
Assistant Controller or any other officer of the Trustee customarily performing
functions similar to those performed by any of the above-designated officers and
in each case having direct responsibility for the administration of this
Agreement, and also, with respect to a particular matter, any other officer to
whom such matter is referred because of such officer's knowledge of and
familiarity with the particular subject. When used with respect to the Depositor
or any other Person, the Chairman or Vice-Chairman of the Board of Directors,
the Chairman or Vice-Chairman of any executive committee of the Board of
Directors, the President, any Vice President, the Secretary, any Assistant
Secretary, the Treasurer, any Assistant Treasurer, or any other officer of the
Depositor customarily performing functions similar to those performed by any of
the above-designated officers and also, with respect to a particular matter, any
other officer to whom such matter is referred because of such officer's
knowledge of and familiarity with the particular subject.
Rounding Accounts: The Class B-2 Rounding Account and the Class B-3
Rounding Account, collectively.
Securities Act: The Securities Act of 1933, as amended.
Seller: Donaldson, Lufkin & Jenrette Securities Corporation.
Senior Certificates: The Class A Certificates and Class R Certificate,
collectively.
Senior Percentage: As of the Closing Date, approximately 38.4446555775%,
and thereafter, with respect to any Distribution Date, the sum of the Component
A-1-C Principal Balance and the Class Principal Balance of the Class R
Certificate immediately preceding such Distribution Date divided by the
Aggregate Certificate Principal Balance (other than the Component A-2-C
Principal Balance), in each case immediately prior to such Distribution Date.
Senior Principal Amount: For any Distribution Date, an amount equal to the
Senior Percentage of the Principal Payment Amount (exclusive of the portion
thereof attributable to the Discount Fractional Principal Amount).
Single Certificate: A Certificate with an original Certificate Balance of
$1,000.
Subordinate Certificates: The Class B-1, Class B-2 and Class B-3
Certificates, collectively, and designated as such on the face thereof in
substantially the form attached hereto as Exhibits A-2 through 4, respectively.
23
<PAGE>
Subordinate Percentage: As of the Closing Date, approximately
61.5553444225%, and thereafter, with respect to any Distribution Date, the
excess of 100% over the applicable Senior Percentage for such date.
Subordinate Principal Amount: For any Distribution Date, an amount equal
to the Subordinate Percentage of the Principal Payment Amount (exclusive of the
portion thereof attributable to the Discount Fractional Principal Amount);
provided, however, that the Subordinate Principal Amount shall be reduced by the
amounts required to be distributed to Component A-2-C with respect to the
Discount Fractional Principal Shortfall on such Distribution Date.
Substituted Pooled Security: A Pooled Security substituted by the
Depositor for a Defective Pooled Security which must, on the date of such
substitution, (i) have an outstanding Principal Balance, not in excess of and
not more than 5% less than the Principal Balance of the Defective Pooled
Security, (ii) have a Pooled Security Interest Rate not less than the Pooled
Security Interest Rate of the Defective Pooled Security, (iii) have a last
scheduled distribution date not more than six months earlier and not later than
the last scheduled distribution date of the Defective Pooled Security, (iv)
comply with each representation and warranty set forth in Section 2.3 (deemed to
be made as of the Substitution Date), and (v) have the same or comparable rating
of at least one nationally recognized statistical rating organization. More than
one Substituted Pooled Security may be substituted for a Defective Pooled
Security if each such Substituted Pooled Security meets the attributes set forth
in (ii), (iii), (iv) and (v) above, and the attribute in (i) above in the
aggregate.
Substitution Adjustment: As to any date on which a substitution occurs
pursuant to Section 2.7, the excess of (i) the Principal Balance of the
Defective Pooled Security (after application of principal payments received on
or before the date of substitution of any Substituted Pooled Security), together
with all accrued and unpaid interest over (ii) the Principal Balance of such
Substituted Pooled Security as of the date of substitution.
Substitution Date: As defined in Section 2.7.
Tax Matters Person: The Holder of the Class R Certificate issued hereunder
or any Permitted Transferee of such Class R Certificateholder shall be the
initial "tax matters person" for REMIC I and REMIC II within the meaning of
Section 6231(a)(7) of the Code. For tax years commencing after any transfer of
the Class R Certificate, the holder of the greatest Percentage Interest in the
Class R Certificate at year end shall be designated as the Tax Matters Person
with respect to that year. If the Tax Matters Person becomes a Disqualified
Organization, the last preceding Holder of such Authorized Denomination of the
Class R Certificate that is not a Disqualified Organization shall be Tax Matters
Person pursuant to Section 5.1(c). If any Person is appointed as tax matters
person by the Internal Revenue Service pursuant to the Code, such Person shall
be Tax Matters Person.
Transfer: As defined in Section 4.1(b).
24
<PAGE>
Transferee: As defined in Section 4.1(b).
Transferee Affidavit and Agreement: As defined in Section 4.1(c)(i)(B).
Trust Fund: The corpus of the trust created pursuant to Section 2.1 of
this Agreement. The Trust Fund consists of (i) the Pooled Securities and all
rights pertaining thereto; (ii) such assets as from time to time may be held by
the Trustee, including the Certificate Account and the Rounding Accounts, and
(iii) the rights and remedies of the Depositor contained in Section 3.01 of the
Pooled Securities Purchase Agreement dated as of July 1, 1999, between the
Seller and the Depositor.
Trustee: The First National Bank of Chicago, or its successor-in-interest
as provided in Section 6.9, or any successor trustee appointed as herein
provided.
Trustee Fee: For each Pooled Security, a fee per annum equal to 0.050% of
the outstanding Principal Balance thereof which shall be paid to the Trustee.
Uncollected Interest: With respect to any Pooled Security on any Pooled
Security Distribution Date, the aggregate amount of Prepayment Interest
Shortfalls on the related Underlying Mortgage Loans allocated to such Pooled
Security.
Underlying Agreements: The agreements pursuant to which the related Pooled
Securities were issued, as in effect on the Closing Date.
Underlying Event of Default: An event of default under an Underlying
Agreement.
Underlying Mortgage Loans: The Loans included in an underlying trust in
which a Pooled Security evidences a beneficial ownership interest.
Underlying Series: Each series of securities which includes one or more
classes of Pooled Securities, as set forth on Exhibit C hereto.
Underwriters: Donaldson, Lufkin & Jenrette Securities Corporation and ABN
AMRO Incorporated.
U.S. Person: A citizen or resident of the United States, a corporation or
partnership (including an entity treated as a corporation or partnership for
federal income tax purposes) created or organized in, or under the laws of, the
United States or any state thereof or the District of Columbia (except, in the
case of a partnership, to the extent provided in regulations) or an estate whose
income is subject to United States federal income tax regardless of its source,
or a trust if a court within the United States is able to exercise primary
supervision over the administration of the trust and one or more such U.S.
Persons have the authority to control all substantial decisions of the trust. To
the extent prescribed in
25
<PAGE>
regulations by the Secretary of the Treasury, which have not yet been issued, a
trust which was in existence on August 20, 1996 (other than a trust treated as
owned by the grantor under subpart E of part 1 of subchapter J of chapter 1 of
the Code), and which was treated as a U.S. Person on August 20, 1996 may elect
to continue to be treated as a U.S. Person notwithstanding the previous
sentence.
Withdrawal Date: The Business Day immediately preceding the related
Distribution Date.
All references to the origination date or original date in the Pooled
Securities Schedule with respect to a Pooled Security shall refer to the date
upon which the related Pooled Security was initially purchased.
ARTICLE II
CONVEYANCE OF TRUST FUND;
ORIGINAL ISSUANCE OF CERTIFICATES
Section 2.1. Conveyance of Trust Fund. The Depositor, concurrently with
the execution and delivery hereof, does hereby irrevocably sell, convey and
assign to the Trustee and REMIC I without recourse all the right, title and
interest of the Depositor in and to the Trust Fund and to REMIC II without
recourse all the right, title and interest of the Depositor in and to the REMIC
I Regular Interests, for the benefit respectively of REMIC II and the
Certificateholders, including all interest and principal received by the
Depositor with respect to the Pooled Securities after the Cut-Off Date (and
including without limitation payments of principal and interest paid after the
Cut-Off Date, but not including payments of principal and interest paid on the
Pooled Securities (without duplication) (i) on or before the Cut-Off Date and
(ii) in respect of the July Distribution). The Depositor, at its own expense,
shall file or cause to be filed protective Form UCC-1 financing statements with
respect to the Pooled Securities in the State of Illinois or other applicable
jurisdiction, listing itself as "Debtor" under such financing statement and
listing the Trustee, for the benefit of the Certificateholders, as "Secured
Party" under such financing statement.
In connection with such transfer and assignment, and concurrently with its
execution and delivery of this Agreement, or, with respect to Substitute Pooled
Securities, on the date of substitution, the Depositor shall deliver the Pooled
Securities to the Trustee, as trustee (or, with respect to Pooled Securities in
book-entry form, deliver evidence of the Trustee's interest in such Pooled
Securities). To the extent available, the Depositor also shall provide the
Trustee no later than the Closing Date or, with respect to Substitute Pooled
Securities, on Substitution Date, the offering documents and the Underlying
Agreements with respect to each Pooled Security and the most recent Pooled
Security Distribution Date Statement received by the Depositor.
26
<PAGE>
All rights arising out of Pooled Securities including, without limitation,
all funds received on or in connection with a Pooled Security shall be held by
the Trustee in trust for the benefit of the Certificateholders. The Trustee
shall maintain a complete set of books and records for each Pooled Security
which shall be clearly marked to reflect the ownership of each Pooled Security
by the Trustee for the benefit of the Certificateholders.
It is the express intent of the parties to this Agreement that the
conveyance of the Pooled Securities by the Depositor to the Trustee as provided
in this Section 2.1 be, and be construed as, a sale of the Pooled Securities by
the Depositor to the Trustee and that the sale of the Certificates to the
Certificateholders, if they are sold, be, and be construed as, a sale of a 100%
interest in the Pooled Securities and the Trust Fund to such Certificateholders,
respectively. It is, further, not the intention of the parties to this Agreement
that such conveyance be deemed a pledge of the Pooled Securities by the
Depositor to the Trustee to secure a debt or other obligation of the Depositor.
However, in the event that, notwithstanding the intent of the parties to this
Agreement, the Pooled Securities are held to be property of the Depositor, or if
for any other reason this Agreement is held or deemed to create a security
interest in the Pooled Securities, then (a) this Agreement shall also be deemed
to be a security agreement within the meaning of Articles 8 and 9 of the New
York Uniform Commercial Code; (b) the conveyance provided for in this Section
2.1 shall be deemed to be a grant by the Depositor to the Trustee for the
benefit of the Certificateholders of a security interest in all of the
Depositor's right, title and interest in and to the Pooled Securities and all
amounts payable to the holders of the Pooled Securities in accordance with the
terms thereof and all proceeds of the conversion, voluntary or involuntary, of
the foregoing into cash, instruments, securities or other property, including
without limitation all amounts, other than investment earnings, from time to
time held or invested in the Certificate Account and the Rounding Accounts,
whether in the form of cash, instruments, securities or other property; (c) the
possession by the Trustee or any Custodian of such items of property and such
other items of property as constitute instruments, money, negotiable documents
or chattel paper shall be deemed to be "in possession by the secured party" for
purposes of perfecting the security interest pursuant to Section 9-305 of the
New York Uniform Commercial Code; and (d) notifications to persons holding such
property, and acknowledgments, receipts or confirmations from persons holding
such property, shall be deemed notifications to, or acknowledgments, receipts or
confirmations from, financial intermediaries, bailees or agents (as applicable)
of the Trustee for the benefit of the Certificateholders for the purpose of
perfecting such security interest under applicable law (except that nothing in
this clause (d) shall cause any person to be deemed to be an agent of the
Trustee for any purpose other than for perfection of such security interest
unless, and then only to the extent, expressly appointed and authorized by the
Trustee in writing). The Depositor and the Trustee, upon directions from the
Depositor, 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 Pooled Securities, 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 this
Agreement.
27
<PAGE>
The Trustee is authorized to appoint any bank or trust company approved by
the Depositor as Custodian of the documents or instruments referred to in this
Section 2.1, and to enter into a Custodial Agreement for such purpose and any
documents delivered thereunder shall be delivered to the Custodian and any
Officer's Certificates delivered with respect thereto shall be delivered to the
Trustee and the Custodian.
Section 2.2. Acceptance by Trustee. The Trustee acknowledges, subject to
the provisions of Section 2.1, receipt of the Pooled Securities referred to in
Section 2.1 above, and declares that it holds and will hold such documents and
the other documents constituting a part of the items of property included in the
Trust Fund delivered to it as Trustee in trust, upon the trusts herein set
forth, for the use and benefit of all present and future Certificateholders.
Section 2.3. Representations and Warranties of the Depositor. (a) The
Depositor hereby represents and warrants to the Trustee as of the Closing Date:
(i) that the information referred to in the Pooled Security Schedule
was true and correct in all material respects as of the Pooled Security
Information Date;
(ii) immediately prior to the sale of the Pooled Securities to the
Trustee, the Depositor was the sole owner and holder of the Pooled
Securities, free an clear of any and all liens, pledges, participations,
charges, mortgages, encumbrances or security interests of any nature
whatsoever, 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; and
(iii) the Depositor has the requisite power and authority to sell
the Pooled Securities and all corporate and other action required to be
taken for the sale of the Pooled Securities hereunder has been taken.
Upon discovery by the Seller, the Depositor or the Trustee of a breach of
any of the representations and warranties set forth in this Section 2.3 that
materially and adversely affects the value of the Pooled Securities or the
interests of the Trustee in the related Pooled Security, the party discovering
such breach shall give prompt written notice to the other party. Pursuant to
such notice, the Depositor shall be directed to cure such breach. Within 60 days
of its discovery or its receipt of notice of breach, if the Depositor, or the
Seller at the direction of the Depositor, has not cured such breach in all
material respects, the Depositor shall either substitute a Substituted Pooled
Security for the Defective Pooled Security as provided in Section 2.7 or shall
purchase the Defective Pooled Security from the Trustee on the first day of the
month in the month following the month in which such 60-day period expired for
the Purchase Price of such Pooled Security. Upon receipt of either a Substituted
Pooled Security or the Purchase Price by the Trustee, the Trustee shall release
the Defective Pooled Security to the Depositor, and the Trustee shall execute
and deliver such instruments of transfer or assignment, in each case without
recourse, as shall be necessary to vest in the Depositor or its designee any
Pooled
28
<PAGE>
Security released pursuant hereto. It is understood and agreed that the
obligation of the Depositor to cure, substitute or repurchase any Pooled
Security as to which a breach has occurred and is continuing shall constitute
the sole remedy respecting such breach available to Certificateholders or the
Trustee on behalf of Certificateholders, and such obligation shall survive as
the obligation of the Depositor, the Seller or their respective successors.
It is understood and agreed that the representations and warranties set
forth in this Section 2.3 shall survive delivery of the respective Pooled
Securities to the Trustee. Upon discovery by the Depositor or the Trustee or any
Custodian of a breach of any of the foregoing representations and warranties
(referred to herein as a "breach"), without regard to any limitation set forth
in such representation or warranty concerning the knowledge of the Depositor as
to the facts stated therein, which breach materially and adversely affects the
interests of the Certificateholders in the related Pooled Security, the party
discovering such breach shall give prompt written notice to the others and to
the Rating Agency.
(b) The Depositor hereby represents and warrants to the Trustee as
of the Closing Date:
(i) The Depositor 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 qualified under the laws of each state
where required by applicable law or is otherwise exempt under
applicable law from such qualification. The Depositor has all
requisite power and authority to enter into this Agreement and to
carry out the transactions contemplated hereby;
(ii) The execution and delivery by the Depositor of this
Agreement and the consummation of the transactions contemplated
hereby have each been duly and validly authorized by all necessary
action, and this Agreement constitutes a valid and legally binding
agreement of the Depositor, enforceable against the Depositor in
accordance with its terms, except that (i) the enforceability hereof
may be limited by bankruptcy, insolvency, moratorium, receivership
and other similar laws relating to creditors' rights generally and
(ii) the remedy of specific performance and injunctive and other
forms of equitable relief may be subject to equitable defenses and
to the discretion of the court before which any proceeding therefor
may be brought;
(iii) The execution and delivery of this Agreement and the
consummation of the transactions contemplated hereby will not
violate, conflict with, result in a breach of, constitute a default
under or be prohibited by, or require any additional approval,
waiver or consent under the Depositor's charter or by-laws or any
instrument or agreement to which it is a party or by which it is
bound or any federal or state law, rule or regulation or any
judicial or administrative decree, order, ruling or regulation
applicable to it; and
29
<PAGE>
(iv) There is no litigation or action at law or in equity
pending, or, to the Depositor's knowledge, threatened against the
Depositor and no proceeding or investigation of any kind is pending
or, to the Depositor's knowledge, threatened, by any federal, state
or local government or administrative body, which could reasonably
be expected to materially and adversely affect the Depositor's
ability to consummate the transactions contemplated hereby.
Section 2.4. Authentication and Delivery of Certificates; Designation of
Certificates as REMIC Regular and Residual Interests.
(a) The Trustee acknowledges the transfer to the extent provided herein
and assignment to it of the Trust Fund and, concurrently with such transfer and
assignment, has caused to be authenticated and delivered to or upon the order of
the Depositor, in exchange for the Trust Fund, Certificates evidencing the
entire ownership of the Trust Fund.
(b) This Agreement shall be construed so as to carry out the intention of
the parties that each of REMIC I and REMIC II be treated as a REMIC at all times
prior to the date on which the Trust Fund is terminated. The "regular interests"
(within the meaning of Section 860G(a)(1) of the Code) in REMIC II shall consist
of the Class A Certificates and the Subordinate Certificates. The "residual
interest" (within the meaning of Section 860(G)(a)(2) of the Code) in REMIC II
shall consist of Component R-2 of the Class R Certificate. The "regular
interests" (within the meaning of Section 860(G)(a)(1) of the Code) of REMIC I
shall consist of the Component A-1-C Regular Interest, the Component A-2-C
Regular Interest, the Component A-3-C Regular Interest, the Class B-1 Regular
Interest, the Class B-2 Regular Interest and the Class B-3 Regular Interest. The
"residual interest" (within the meaning of Section 860(G)(a)(2) of the Code) of
REMIC I shall consist of Component R-1 of the Class R Certificate.
(c) All payments with respect to each of the Class A-1-C, A-2-C and A-3-C
Components and the Class B-1, B-2 and B-3 Certificates shall each be considered
to have been made solely from the Regular Interest of REMIC I having the same
designation.
(d) The interest rate of each of the REMIC Regular Interest Components
A-1-C and A-3-C and Class B-1, B-2 and B-3 of REMIC I shall be the same as the
Remittance Rate of the Certificate or Component of REMIC II having the same
designation. The Component A-2-C Regular Interest Class shall not bear interest,
but will receive principal only in respect of certain Pooled Securities.
(e) The principal balance of each of the Regular Interests of REMIC I is
equal at all times to the Class Principal Balance or Component Principal Balance
of the Class or Component of REMIC II which has the same designation. The
notional principal balance of the Component A-3-C Regular Interest is equal at
all times to the Component A-3-C Notional Amount.
30
<PAGE>
Section 2.5. Designation of Startup Day. The Closing Date is hereby
designated as the "startup day" of each of REMIC I and REMIC II within the
meaning of Section 860G(a)(9) of the Code.
Section 2.6. No Contributions. The Trustee shall not accept or make any
contribution of cash to the Trust Fund after 90 days of the Closing Date, and
shall not accept or make any contribution of other assets to the Trust Fund
unless, in either case, it shall have received an Opinion of Counsel to the
effect that the inclusion of such assets in the Trust Fund will not cause either
REMIC I or REMIC II to fail to qualify as a REMIC at any time that any Class A
or Subordinate Certificates are outstanding or subject the Trust Fund to any tax
on contributions to the REMIC under Section 860G(d) of the Code.
Section 2.7. Substitution of Pooled Securities.
(a) On any date within two years following the Closing Date and which is
on or before the date on which the Depositor would otherwise be required to
repurchase a Pooled Security pursuant to Section 2.3, the Depositor may deliver,
or cause the Seller to deliver, to the Trustee one or more Substituted Pooled
Securities in substitution for a Defective Pooled Security which the Depositor
would otherwise be required to repurchase pursuant to Section 2.3. In connection
with any such substitution, the Depositor shall, or cause the Seller to,
calculate the Substitution Adjustment, if any, and shall deposit such amount in
an account at the direction of the Trustee on the date of which substitution
(the "Substitution Date").
(b) The Depositor shall, or cause the Seller to, notify the Trustee in
writing not less than five business days on or before the date on which the
Depositor would otherwise be required to repurchase any Defective Pooled
Security pursuant to Section 2.3 of its intention to effect a substitution under
this Section. On the Substitution Date, the Seller, at the direction of the
Depositor, shall cause the Substituted Pooled Security to be registered in the
name of the Trustee and to be delivered to the Trustee and shall confirm that
the representations and warranties contained in Section 2.3 are true and correct
in all material respects with respect to the Substituted Pooled Security as of
such Substitution Date, provided that remedies for any breach of such
representations and warranties are limited as set forth in Section 2.3 and this
Section.
(c) Concurrently with the satisfaction of the conditions set forth in this
Section 2.7(a) and (b) above and the transfer of such Substituted Pooled
Securities to the Trustee pursuant to this Section, Exhibit C to this Agreement
shall be deemed to be amended to exclude the Defective Pooled Security and to
include the information with respect to such Substituted Pooled Securities, and
all references in this Agreement to the Pooled Securities shall include such
Substituted Pooled Securities and be deemed to be made on or after the related
Substituted Date, as the case may be, as to such Substituted Pooled Securities.
31
<PAGE>
(d) In connection with the transfer of any Substituted Pooled Securities
to the Trustee pursuant to this Section 2.7, the Seller, at the direction of the
Depositor, shall deliver to the Depositor and the Trustee an Opinion of Counsel
to the effect that such substitution will not cause (x) any federal tax to be
imposed on the trust, including, without limitation, any Federal tax imposed on
the "prohibited transactions" under Section 860G(d)(1) of the Code or (y) the
trust to fail to qualify as a REMIC at any time that any Certificate is
outstanding (a "REMIC Opinion"). In the event that such opinion indicates that a
substitution will result in the imposition of a prohibited transaction tax, give
rise to net taxable income or be deemed a contribution to the REMIC, the Seller
at the direction of the Depositor, or the Depositor shall not substitute for any
such Pooled Securities until the REMIC Opinion to the effect referred to in the
preceding sentence may be rendered.
ARTICLE III
ADMINISTRATION OF THE POOLED SECURITIES
Section 3.1. Administration of the Trust and the Pooled Securities. If at
any time the Trustee, as a holder of a Pooled Security, is requested in such
capacity, whether by a Certificateholder, a holder of a certificate of the
related Underlying Series or a party to the related Underlying Agreement or any
other Person, to take any action or to give any consent, approval or waiver,
including without limitation in connection with the servicing and administration
of Acquired Mortgage Assets, an amendment of any related Underlying Agreement or
the occurrence of an Underlying Event of Default, the Trustee shall promptly
notify the Depositor and all Certificateholders of such request and shall, in
its capacity as a holder of the Pooled Securities, take such action in
connection with the exercise and/or enforcement of any rights and/or remedies
available to it in such capacity with respect to such request as shall be
directed in writing by the Holders of Certificates having a Percentage Interest
aggregating not less than 51% of the Trust Fund. The Trustee shall promptly
furnish to the Depositor and, upon the written request and at the expense of a
Certificateholder, will make available to each Certificateholder, all notices,
statements, reports or other information that it receives as holder of the
Pooled Securities, including without limitation information regarding the
Underlying Mortgage Loans and any Acquired Mortgage Assets.
Section 3.2. Collection of Monies. (a) In connection with its receipt of
any distribution on the Pooled Securities on any Pooled Security Distribution
Date (or such later date on which the Trustee shall receive the related Pooled
Security Distribution Date Information), the Trustee shall review the related
Pooled Security Distribution Date Information delivered to it and shall confirm
that the aggregate amount of such distribution received is consistent with such
information (it being understood that the Trustee shall be entitled to rely on
the accuracy and correctness of such information).
32
<PAGE>
If the Trustee shall gain actual knowledge of any Underlying Event of
Default, the Trustee shall promptly notify the Certificateholders and the
Depositor of such occurrence and such parties shall proceed in accordance with
the terms and conditions of Section 3.1.
(b) If a Responsible Officer of the Trustee receives a Notice of Final
Distribution in respect of any Pooled Security, the Trustee shall present and
surrender the related Pooled Security which is in certificated form for final
payment thereon in accordance with the terms and conditions of the related
Underlying Agreement and such notice. The Trustee shall promptly deposit in the
Certificate Account the final distribution received upon presentation and
surrender of such Pooled Security for distribution in accordance with Section
3.5 hereof on the next succeeding Distribution Date.
Section 3.3. Establishment of the Certificate Account; Deposits Therein.
(a) The Trustee, for the benefit of the Certificateholders, shall establish and
maintain one or more trust accounts (collectively, the "Certificate Account"),
each of which shall be an Eligible Account, entitled "The First National Bank of
Chicago, as Trustee for the registered holders of ABN AMRO Mortgage Corporation
Resecuritization Pass-Through Certificates, Series 1999-RS1," held in trust by
the Trustee for the benefit of the Certificateholders. The Trustee shall cause
all distributions received on the Pooled Securities by the Trustee in its
capacity as holder of the Pooled Securities, from whatever source, and all
amounts received by it representing payment of a Purchase Price pursuant to
Section 2.3 or 7.1, subsequent to the Closing Date to be deposited directly into
the Certificate Account. The Certificate Account is initially located at the
Trustee. The Trustee shall give notice to the Depositor and to
Certificateholders of any new location of the Certificate Account prior to any
change thereof.
(b) In the event that payments in respect of the Pooled Securities are
received by the Trustee prior to the related Distribution Date, the Trustee may
hold such funds uninvested or invest such funds deposited in the Certificate
Account in one or more Eligible Investments held in the name of the Trustee and
shall receive as compensation, in addition to the Trustee Fee, that portion of
investment income earned on such Eligible Investments. Notwithstanding the
foregoing, no such Eligible Investment may mature later than the day before such
related Distribution Date and no such investment shall be sold prior to its
maturity date. The amount of any net losses incurred in respect of any such
investments shall be deposited in the Certificate Account by the Trustee out of
its own funds immediately as realized.
(c) With respect to the Certificate Account and the funds deposited
therein, the Trustee shall take such action as may be necessary to ensure that
the Certificateholders shall be entitled to the priorities afforded to such a
trust account (in addition to a claim against the estate of the Trustee) as
provided by 12 U.S.C. 'SS' 92a(e), if applicable, or any applicable comparable
state statute applicable to state chartered banking corporations.
Section 3.4. Permitted Withdrawals From the Certificate Account. (a) The
Trustee may from time to time withdraw funds from the Certificate Account for
the following purposes:
33
<PAGE>
(i) to make distributions in the amounts and in the manner provided
for in Section 3.5;
(ii) to pay to itself from any deposit in the Certificate Account as
to interest, to the extent permitted by this Agreement, the Trustee Fees
pursuant to Section 3.6, or otherwise to pay to itself any unpaid Trustee
Fees;
(iii) to pay to the Person entitled thereto any amount deposited in
the Certificate Account in error; and
(iv) to clear and terminate the Certificate Account upon the
termination of this Agreement.
(b) On each Distribution Date, the Trustee shall withdraw all funds from
the Certificate Account and shall use such funds withdrawn from the Certificate
Account only for the purposes described in this Section 3.4 and in Section 3.5.
Section 3.5. Distributions. (a) On each Distribution Date, the Trustee or
the Paying Agent, if any, shall withdraw from the Certificate Account the
Available Funds on deposit in the Certificate Account as of such Distribution
Date and shall distribute to each Certificateholder, from the amount so
withdrawn and to the extent of the Available Funds, such Certificateholder's
share (based on the aggregate Percentage Interests represented by the
Certificates of the applicable Class held by such Certificateholder) of the
amounts and in the order of priority as set forth in the definition of
"Certificate Distribution Amount", by wire transfer in immediately available
funds for the account of the Certificateholder, or by any other means of payment
acceptable to each Certificateholder of record on the immediately preceding
Record Date (other than as provided in Section 7.1 respecting the final
distribution), as specified by each such Certificateholder and at the address of
such Holder appearing in the Certificate Register; provided, that if the Trustee
has appointed a Certificate Administrator, such distributions above shall be
made in accordance with written statements received from the Certificate
Administrator pursuant to Section 3.7.
If the Trustee has not received a distribution on, or the Pooled Security
Distribution Date Information with respect to, the Pooled Securities by the
Pooled Security Distribution Date, such distribution will be made on the next
succeeding Distribution Date, and no additional interest will be paid thereon.
(b) All reductions in the Certificate Principal Balance of a Certificate
effected by distributions of principal or allocations of Loss Amounts with
respect to Pooled Securities made on any Distribution Date shall be binding upon
all Holders of such Certificate and of any Certificate issued
34
<PAGE>
upon the registration of transfer or exchange therefor or in lieu thereof,
whether or not such distribution is noted on such Certificate.
(c) Whenever, the Trustee believes, or the Certificate Administrator, if
any, has notified the Trustee that it believes, that the entire remaining unpaid
Class Principal Balance of any Class of Certificates will become distributable
on the next Distribution Date, the Trustee or the Certificate Administrator, if
any, shall, no later than five days before the Distribution Date of the month of
such Distribution Date, mail or cause to be mailed to each Person in whose name
a Certificate to be so retired is registered at the close of business on the
Record Date, to the Underwriters and to the Rating Agency a notice to the effect
that:
(i) it is expected that funds sufficient to make such final
distribution will be available in the Certificate Account on such
Distribution Date, and
(ii) if such funds are available, (A) such final distribution
will be payable on such Distribution Date, but only upon
presentation and surrender of such Certificate at the office or
agency of the Certificate Registrar maintained for such purpose (the
address of which shall be set forth in such notice), and (B) no
interest shall accrue on such Certificate after such Distribution
Date.
(d) The Trustee will make distributions in reduction of the outstanding
Certificate Principal Balance of the Class B-2 and Class B-3 Certificates to the
Depository for distribution among the DTC Participants on a Random Lot basis.
Each DTC Participant and, in turn, each Indirect DTC Participant shall then
select, in accordance with its own procedures, the applicable Class B-2 or Class
B-3 Certificates from among those held in its accounts to receive mandatory
principal distributions, such that the total amount of principal distributed to
the DTC Participants and Indirect DTC Participants so selected is equal to the
aggregate amount of such mandatory distributions allocated to such DTC
Participant by the Depository and to such Indirect DTC Participant by its
related DTC Participant, as the case may be. Nothing in this Agreement or in any
Certificate shall require either the Depositor or the Trustee to issue any
notice.
In the event that Definitive Certificates representing Class B-2 or
Class B-3 Certificates are issued, an amendment to this Agreement, which may be
approved without the consent of any Certificateholders, shall establish
procedures relating to the manner in which distributions in reduction of the
outstanding Certificate Principal Balance of the Class B-2 or Class B-3
Certificates are to be made.
(e) Notwithstanding any other provision of this Agreement, the Trustee
shall comply with all federal withholding requirements respecting payments to
Certificateholders of interest or the accrual of original issue discount that
the Trustee reasonably believes are applicable under the Code. The consent of
Certificateholders shall not be required for such withholding. In the event the
Trustee does withhold
35
<PAGE>
any amount from payments to any Certificateholder pursuant to federal
withholding requirements, the Trustee shall indicate the amount withheld to such
Certificateholders.
(f) The Trustee may conclusively rely on the information set forth in the
Pooled Security Distribution Date Information in making the calculations called
for in this Section 3.5, including, without limitation, the determinations of
the interest and principal to be paid on each Class of Certificates. If the
information available to the Trustee in any Pooled Security Distribution Date
Information is insufficient to make the calculations provided for in this
Section 3.5, the Trustee shall promptly request the underlying trustee with
respect to the Pooled Securities to provide sufficient information in writing,
and after receipt of such information the Trustee shall make on the following
Distribution Date any necessary adjustments in the application of amounts in the
Certificate Account. If such information is not received from such underlying
trustee, the Trustee shall not be responsible for making any such adjustment.
Section 3.6. Trustee Compensation. The Trustee shall be entitled to retain
or, if not retained, to withdraw from the Certificate Account, as trustee
compensation, its Trustee Fee out of each payment on account of interest on each
Pooled Security. The Trustee shall be required to pay all expenses incurred by
it or them in connection with its trustee activities hereunder and shall not be
entitled to reimbursement therefor except as specifically provided herein.
The Trustee shall be responsible for paying all compensation and expenses
of the Certificate Administrator out of its Trustee Fee. The Certificate
Administrator shall not be entitled to reimbursement of expenses incurred by it
in connection with its certificate administrator activities hereunder and shall
not be entitled to reimbursement therefor except as specifically provided
herein.
Section 3.7. Distribution Reports to the Trustee. In the event that the
Trustee has appointed a Certificate Administrator, prior to 5:00 P.M. New York
City time on the Withdrawal Date, the Certificate Administrator shall provide
the Trustee with a statement regarding the amount of principal and interest and
the Residual Distribution Amount to be distributed to each Class of Certificates
on such Distribution Date (such amounts to be determined in accordance with the
definition of "Certificate Distribution Amount", Section 3.5 hereof and other
related definitions set forth in Article I hereof).
Section 3.8. Statements to Certificateholders. (a) On each Distribution
Date, the Certificate Administrator or Trustee, as applicable, shall prepare,
and shall forward by mail, a statement (each a "Certificateholders' Report") to
the Trustee (if the Trustee has appointed a Certificate Administrator) each
Certificateholder, the Depositor and the Rating Agency stating:
(i) the Available Funds for such Distribution Date;
(ii) the amount of interest being distributed on each Class of
Certificates for such Distribution Date and the Remittance Rates
constituted thereby;
36
<PAGE>
(iii) the amount of principal being distributed on each Class of
Certificates for such Distribution Date;
(iv) the Loss Amounts allocated to the most subordinated Class or
Classes of Certificates on such Distribution Date and since the Closing
Date;
(v) the Class Principal Balances for each Class of Certificates
before and after applying payments and allocating the Loss Amount on such
Distribution Date;
(vi) the aggregate Pooled Security Distribution Date Principal
Balance as of the second immediately preceding Pooled Security
Distribution Date; and
(vii) the aggregate Pooled Security Distribution Date Principal
Balance as of the immediately preceding Pooled Security Distribution Date.
In the case of the information furnished pursuant to clauses (ii) and
(iii) above, the amounts shall also be expressed as a dollar amount per Single
Certificate. The Trustee's responsibility for reporting the above information is
limited to the availability, timeliness, and accuracy of the information so
furnished to it in the related Pooled Security Distribution Date Information and
any additional written information requested by the Trustee with respect to the
Pooled Securities. If the Trustee receives any such additional information after
preparing a statement required by this Section, the Trustee shall report the
related adjustments in the statement prepared after receipt of such information.
(b) The Certificate Administrator or the Trustee, as applicable, shall
prepare and deliver to the Trustee (if the Trustee has appointed a Certificate
Administrator) each Certificateholder, the Depositor and the Rating Agency,
based on and to the extent of the information so furnished to it in the Pooled
Security Distribution Date Information, no later than five Business Days
following each Distribution Date, the following information:
(i) For each Pooled Security which received a monthly distribution
to be included in the payment on the Certificates on the related
Distribution Date, and to the extent reported in the related Pooled
Security Distribution Date Information:
(A) the Pooled Security Distribution Date Principal Balance of
such Pooled Security as of the second immediately preceding Pooled
Security Distribution Date and the immediately preceding Pooled
Security Distribution Date, which date shall be specified;
(B) the Pooled Security Interest Rate and Uncollected
Interest, if any, expressed as a per annum rate borne by such Pooled
Security with respect to the related Pooled Security Distribution
Date;
37
<PAGE>
(C) the amount of interest distributed on such Pooled Security
on the related Pooled Security Distribution Date, as well as any
amount by which the amount of interest scheduled to be distributed
on such Pooled Security on such Pooled Security Distribution Date
exceeded the amount of interest actually distributed thereon;
(D) all Realized Losses incurred on the Underlying Mortgage
Loans on the related Pooled Security Distribution Date, since the
date of issuance of such Pooled Security and since the Mortgage Loan
Information Date;
(E) all Realized Losses allocated to the Pooled Security on
the related Pooled Security Distribution Date since the Mortgage
Loan Information Date;
(F) the amount, aggregate principal balance and percentage of
the Underlying Mortgage Loans that were (i) more than 30 but fewer
than 60 days delinquent, (ii) more than 60 but fewer than 90 days
delinquent, (iii) 90 days or more delinquent, (iv) in foreclosure,
and (v) "REO" property, each as of the end of the reporting period
to which the Pooled Security Distribution Date Statement delivered
with respect to such Pooled Security as of the related Pooled
Security Distribution Date;
(G) the amount of principal distributed on such Pooled
Security on the related Pooled Security Distribution Date;
(H) the total amount distributed on such Pooled Security on
the related Pooled Security Distribution Date; and
(I) the amount of any Pooled Security Credit Support remaining
with respect to such Pooled Security on the related Pooled Security
Distribution Date, stated as a dollar amount and as a percent of the
aggregate outstanding principal balance of the related Underlying
Mortgage Loans.
(ii) For all Underlying Mortgage Loans, an aggregate statement of
delinquency statistics reporting all of the information specified in
clause (i)(F) above in the aggregate for the related Pooled Security
Distribution Date and each of the eleven prior reporting periods;
(iii) The number and aggregate Pooled Security Distribution Date
Principal Balance of all of the Pooled Securities and the amount of
principal and interest distributed on such securities, as of the
respective related Pooled Security Distribution Date; and
(iv) The aggregate outstanding principal balance of the Underlying
Mortgage Loans as reported on the related Pooled Security Distribution
Date Statements.
38
<PAGE>
(c) The Certificate Administrator or the Trustee, as applicable, shall
promptly notify the Depositor of the receipt following a Distribution Date of
any corrected Pooled Security Distribution Date Information with respect to a
Pooled Security which results in a change in excess of $1,000. The Certificate
Administrator or the Trustee, as applicable, shall consult with the Depositor
concerning such change and the Depositor and the Certificate Administrator or
the Trustee, as applicable, shall mutually agree on a course of action with
respect thereto.
(d) The Certificate Administrator or the Trustee, as applicable, shall
promptly furnish to the Depositor and, upon the written request and at the
expense of a Certificateholder, will make available to each Certificateholder,
copies of any notices, statements, reports or other communications including,
without limitation, the Pooled Security Distribution Date Statement, received by
the Trustee in its capacity as a holder of Pooled Securities, with respect to
the Pooled Securities. The Certificate Administrator or the Trustee, as
applicable, shall furnish copies of all Pooled Security Distribution Date
Statements to the Rating Agency promptly after its receipt of the same.
(e) On or before March 31st of each calendar year, commencing in 2000, the
Trustee shall prepare and deliver by first class mail to the Depositor and to
each Person who at any time during the prior calendar year was a
Certificateholder of record a statement containing the information required to
be contained in the Certificateholders' Report, as set forth in clause (a)(ii)
and (a)(iii) above aggregated for such prior calendar year or the 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, and regulations thereunder as from
time to time are in force.
Section 3.9. Access to Certain Documentation and Information. The
Certificate Administrator and/or the Trustee, as applicable, shall provide to
the Depositor access to all reports, documents and records maintained by the
Certificate Administrator or the Trustee, as applicable, in respect of their
duties hereunder, such access being afforded without charge but only upon three
Business Days' written request and during normal business hours at offices
designated by the Certificate Administrator or the Trustee, as applicable.
Section 3.10. Calculation of Amount to be Distributed. All calculations of
the amounts to be distributed on any Distribution Date will be made by the
Paying Agent and/or the Certificate Administrator and/or the Trustee, as
applicable, in reliance on the information provided to the applicable party in
the applicable Pooled Security Distribution Date Information and any additional
written information requested by the Paying Agent and/or the Certificate
Administrator and/or the Trustee, as applicable, with respect to the Pooled
Securities. The Paying Agent and/or the Certificate Administrator and/or the
Trustee, as applicable, shall promptly communicate the results of its
calculations to the Depositor and the Certificateholders (which obligation may
be satisfied through the distribution of the statements required under Section
3.7).
39
<PAGE>
Section 3.11. REMIC-Related Covenants. For as long as either REMIC I or
REMIC II shall exist, the Paying Agent and/or the Certificate Administrator
and/or the Trustee, as applicable, shall act in accordance herewith to assure
continuing treatment of each such REMIC as a REMIC. In particular, the Trustee
shall not other than with respect to a substitution pursuant to Section 2.4,
accept any contribution to REMIC II after the Startup Day without receipt of a
REMIC Opinion.
Section 3.12. Allocation of Loss Amounts. On each Distribution Date, the
Paying Agent and/or the Certificate Administrator and/or the Trustee, as
applicable, shall determine the Loss Amounts and shall allocate it to the
Certificates by reducing the Certificate Principal Balance of the Classes of
Certificates and the Component Principal Balance of the Components of
Certificates other than Component A-2-C and Component A-3-C of the Class A
Certificates until the respective Certificate Principal Balances thereof are
reduced to zero. All Loss Amounts will be allocated as follows: first, to the
Subordinate Certificates, by Pro Rata Allocation, until the aggregate Class
Principal Balance thereof has been reduced to zero and second, to the Senior
Certificates and Components (other than Component A-2-C and Component A-3-C of
the Class A Certificates) by Pro Rata Allocation, until the aggregate Class
Principal Balance or Component Principal Balance thereof has been reduced to
zero.
Section 3.13. Prohibited Transactions Taxes and Other Taxes. (a) In the
event that any tax (including a tax on "prohibited transactions" as defined in
Section 860F(a)(2) of the Code and including any and all interest, penalties,
fines and additions to tax, as well as any and all reasonable counsel fees and
out-of-pocket expenses incurred in contesting the imposition of such tax) is
imposed on the Trust Fund and is not otherwise paid pursuant to Section 3.13(b)
hereof, the Trustee shall pay such taxes when and as the same shall be due and
payable (but such obligation shall not prevent the Trustee, the Certificate
Administrator, if any, 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); provided, that the Trustee shall be entitled to be
indemnified for any such taxes and any related fees and expenses (excluding
taxes referred to in Section 3.13(b)) to the extent set forth in Section 6.6
hereof so long as the Trustee's failure to exercise reasonable care with respect
to the performance of its duties hereunder was not the primary cause of the
imposition of such taxes. If the Trustee is indemnified for such taxes pursuant
to this Section 3.13(a), such amount shall be first charged against amounts
otherwise distributable to the Holders of Component R-1 of the Class R
Certificate (or, if the tax relates to REMIC II, Component R-2 of the Class R
Certificate) on a pro rata basis, then against amounts otherwise distributable
with respect to the REMIC I Regular Interests (or, if the tax relates to REMIC
II, to the Holders of the Certificates) on a pro rata basis. The Trustee is
hereby authorized to retain from amounts otherwise distributable to the
Certificateholders sufficient funds to reimburse itself for the payment of such
tax for which the Trustee is entitled to indemnification.
(b) The Trustee shall pay on written demand, and shall indemnify and hold
harmless the Trust Fund from and against, any and all taxes imposed on the Trust
Fund (including, for this purpose,
40
<PAGE>
any and all interest, penalties, fines and additions to tax, as well as any and
all reasonable counsel fees and out-of-pocket expenses incurred in contesting
the imposition of such tax) to the extent that any such tax is due to its
negligence or willful misconduct.
Section 3.14. Tax Administration. (a) The Trustee is hereby appointed as
attorney-in-fact and agent for the initial Tax Matters Person; provided, that
the Trustee may appoint, and hereby does so appoint, the Certificate
Administrator as attorney-in-fact and agent for the Tax Matters Person. The
Trustee may, by written notice delivered to the Certificate Administrator,
revoke the appointment of the Certificate Administrator as attorney-in-fact and
agent for the Tax Matters Person, in which case the Trustee shall act in such
capacity.
(b) The Tax Matters Person, or the Person acting as attorney-in-fact and
agent therefor, shall: (i) prepare and file, or cause to be prepared and filed,
federal tax returns (as well as any other federal and state information and
other returns) using a calendar year as the taxable year when and as required by
the REMIC Provisions; (ii) make (or cause to be made) an election, on behalf of
each of REMIC I and REMIC II, to be treated as a REMIC on the Federal tax return
and any applicable state or local returns for the first taxable year, in
accordance with the REMIC Provisions; (iii) prepare and forward, or cause to be
prepared and forwarded, to the Certificateholders all information reports
(including, without limitation, the information required in connection with the
computation of the present value of anticipated excess inclusions as required by
'SS' 1.860E-2(a)(5) of the REMIC Provisions) as and when required to be provided
to them in accordance with the REMIC Provisions; (iv) conduct the affairs of the
Trust Fund at all times that REMIC I Regular Interests or REMIC II Certificates
are outstanding so as to maintain the status of each of REMIC I and REMIC II as
a REMIC under the REMIC Provisions; and (v) not knowingly or intentionally take
any action or omit to take any action that would cause the termination of the
REMIC status of either REMIC I or REMIC II. Notwithstanding anything in this
Agreement to the contrary, none of the Depositor, Trustee or any other Person
shall (i) engage in any amendment, waiver, forbearance or other similar action
with respect to any Pooled Security that could cause a "significant
modification" of such Pooled Security within the meaning of the REMIC
Provisions, or (ii) acquire any property other than cash in any sale,
disposition, settlement, or termination of any interest in a Pooled Security,
unless the Depositor and the Trustee shall have received a REMIC Opinion with
respect to such action or acquisition.
(c) In order to enable the Trustee or the Certificate Administrator, as
applicable, to perform its duties as set forth in this Section 3.13, the
Depositor agrees to provide any tax forms, instruments or other documents
related thereto, as the Trustee or the Certificate Administrator, as applicable,
may reasonably request, including, without limitation, any tax forms,
instruments or other documents prepared by the Depositor. In order to enable the
Trustee or the Certificate Administrator, as applicable, to perform its duties
as set forth in this Section 3.13, the Depositor shall use its best efforts to
cause to be delivered to the Trustee or the Certificate Administrator, as
applicable, within ten (10) days after the Closing Date all information or data
that the Trustee or the Certificate Administrator, as applicable, determines to
be relevant for tax purposes to the valuations and offering prices of the
41
<PAGE>
Certificates, including, without limitation, the price, yield, prepayment
assumption and projected cash flows. Thereafter, the Depositor shall use its
best efforts to provide to the Trustee or the Certificate Administrator, as
applicable, promptly upon request therefor, any such additional information or
data that the Trustee or the Certificate Administrator, as applicable, may, from
time to time, request in order to enable the Trustee or the Certificate
Administrator, as applicable, to perform its duties as set forth in this Section
3.13.
Section 3.15. Appointment of Paying Agent and Certificate Administrator.
The Trustee may appoint an Eligible Institution to act as a paying agent (the
"Paying Agent") or a certificate administrator (the "Certificate
Administrator"), as the case may be, in order to delegate to such Eligible
Institution any of its duties under this Agreement to administer the issuance,
transfer and exchange of the Certificates, administer payments to
Certificateholders or prepare information related to the Certificates; provided,
that the Trustee shall remain primarily responsible for any duties so delegated;
provided, further, that the Trustee shall receive no additional compensation in
connection with such appointment and delegation.
Initially, the Trustee will be the Certificate Administrator and Paying
Agent. If the Trustee ceases to serve as Certificate Administrator or Paying
Agent, the Trustee shall send written notice to all Certificateholders (i)
indicating that it is no longer in such capacity and (ii) setting forth its
replacement, if any, appointed pursuant to this Section 3.15.
Section 3.16. Equal Status of Trustee Fee. The right of the Trustee to
receive its Trustee Fee will be equal and not subordinate to the right of the
Certificateholders to receive principal and interest payments based on their
interests as provided herein. The Trustee Fee may be collected from amounts in
the Certificate Account pursuant to Section 3.4, whereas the Certificateholders'
distributions shall be made on a delayed basis as set forth in the terms of the
Certificates.
Section 3.17. Maintenance of the Rounding Accounts; Collections
Thereunder. (a) On or prior to the Closing Date, the Trustee shall establish the
B-2 Rounding Account and Donaldson, Lufkin & Jenrette Securities Corporation
shall deposit $999.99 therein. The Trustee shall maintain such account to
provide, if needed, the Class B-2 Rounding Amount on any Distribution Date. On
the first Distribution Date with respect to which the Trustee determines that
amounts are available out of the Available Funds (before giving effect to any
deposits to the Certificate Account in respect of the Class B-2 Rounding Amount
on such Distribution Date) for distributions of principal on the Class B-2
Certificates, the Trustee shall withdraw from the Class B-2 Rounding Account and
deposit into the Certificate Account, the Class B-2 Rounding Amount. On each
succeeding Distribution Date with respect to which the Trustee determines that
amounts are available out of the Available Funds (before giving effect to any
deposits to the Certificate Account in respect of the Class B-2 Rounding Amount
on such Distribution Date) for distributions of principal on the Class B-2
Certificates, the Trustee will first apply the aggregate amount of Available
Funds (before giving effect to any deposits to the Certificate Account in
respect of the Class B-2 Rounding Amount on such Distribution Date) allocable to
such
42
<PAGE>
Class to replenish any funds withdrawn from the B-2 Rounding Account on prior
Distribution Dates which have not yet been replenished. Thereafter, the Trustee
shall determine the remaining amounts available out of Available Funds (before
giving effect to any deposits to the Certificate Account in respect of the Class
B-2 Rounding Amount on such Distribution Date) for distributions of principal on
the Class B-2 Certificates, and shall withdraw from the Class B-2 Rounding
Account and deposit into the Certificate Account, to the extent funds are
available therein, the Class B-2 Rounding Amount.
(b) On or prior to the Closing Date, the Trustee shall establish the B-3
Rounding Account and Donaldson, Lufkin & Jenrette Securities Corporation shall
deposit $999.99 therein. The Trustee shall maintain such account to provide, if
needed, the Class B-3 Rounding Amount on any Distribution Date. On the first
Distribution Date with respect to which the Trustee determines that amounts are
available out of the Available Funds (before giving effect to any deposits to
the Certificate Account in respect of the Class B-3 Rounding Amount on such
Distribution Date) for distributions of principal on the Class B-3 Certificates,
the Trustee shall withdraw from the Class B-3 Rounding Account and deposit into
the Certificate Account, the Class B-3 Rounding Amount. On each succeeding
Distribution Date with respect to which the Trustee determines that amounts are
available out of the Available Funds (before giving effect to any deposits to
the Certificate Account in respect of the Class B-3 Rounding Amount on such
Distribution Date) for distributions of principal on the Class B-3 Certificates,
the Trustee will first apply the aggregate amount of Available Funds (before
giving effect to any deposits to the Certificate Account in respect of the Class
B-3 Rounding Amount on such Distribution Date) allocable to such Class to
replenish any funds withdrawn from the B-3 Rounding Account on prior
Distribution Dates which have not yet been replenished. Thereafter, the Trustee
shall determine the remaining amounts available out of Available Funds (before
giving effect to any deposits to the Certificate Account in respect of the Class
B-3 Rounding Amount on such Distribution Date) for distributions of principal on
the Class B-3 Certificates, and shall withdraw from the Class B-3 Rounding
Account and deposit into the Certificate Account, to the extent funds are
available therein, the Class B-3 Rounding Amount.
(c) Any amounts withdrawn by the Trustee from either Rounding Account
shall be deposited in the Certificate Account for distribution to the Holders of
Class B-2 or Class B-3 Certificateholders as described in the immediately
preceding paragraphs.
ARTICLE IV
THE CERTIFICATES
Section 4.1. The Certificates. (a) The Certificates shall be substantially
in the forms set forth in Exhibits A and B attached hereto, and shall be
executed by the Trustee, authenticated by the Trustee (or any duly appointed
Authenticating Agent) and delivered to or upon the order of the Depositor upon
receipt by the Trustee of the documents specified in Section 2.1. The
Certificates shall
43
<PAGE>
be issuable in Authorized Denominations evidencing Percentage Interests.
Certificates shall be executed by manual or facsimile signature on behalf of the
Trust Fund by the Trustee by authorized officers of the Trustee. Certificates
bearing the manual or facsimile signatures of individuals who were at the time
of execution the proper officers of the Trustee shall bind the Trust Fund,
notwithstanding that such individuals or any of them have ceased to hold such
offices prior to the authentication and delivery of such Certificates or did not
hold such offices at the date of such Certificates. No Certificate shall be
entitled to any benefit under this Agreement, or be valid for any purpose,
unless there appears on such Certificate a certificate of authentication
substantially in the form provided for herein executed by the Trustee or any
Authenticating Agent by manual signature, and such certificate upon any
Certificate shall be conclusive evidence, and the only evidence, that such
Certificate has been duly authenticated and delivered hereunder. All
Certificates, shall be dated the date of their authentication.
(b) The following definitions apply for purposes of this Section 4.1:
"Disqualified Organization" means any Person which is not a Permitted
Transferee, but does not include any "Pass-Through Entity" which owns or holds a
Residual Certificate and of which a Disqualified Organization, directly or
indirectly, may be a stockholder, partner or beneficiary; "Pass-Through Entity"
means any regulated investment company, real estate investment trust, common
trust fund, partnership, trust or estate, and any organization to which Section
1381 of the Code applies; "Ownership Interest" means, with respect to any
Residual Certificate, any ownership or security interest in such Residual
Certificate, including any interest in a Residual Certificate as the Holder
thereof and any other interest therein whether direct or indirect, legal or
beneficial, as owner or as pledgee; "Transfer" means any direct or indirect
transfer or sale of, or directly or indirectly transferring or selling any
Ownership Interest in a Residual Certificate; and "Transferee" means any Person
who is acquiring by Transfer any Ownership Interest in a Residual Certificate.
(c) Restrictions on Transfers of the Residual Certificate to Disqualified
Organizations are set forth in this Section 4.1(c).
(i) 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 to have irrevocably authorized the Trustee, the Certificate
Administrator or the Paying Agent under clause (iii)(A) below to deliver
payments to a Person other than such Person and to negotiate the terms of
any mandatory sale under clause (iii)(B) below and to execute all
instruments of transfer and to do all other things necessary in connection
with any such sale. The rights of each Person acquiring any Ownership
Interest in a Residual Certificate are expressly subject to the following
provisions:
(A) Each Person holding or acquiring any Ownership Interest in
a Residual Certificate shall be a Permitted Transferee and shall
promptly notify the Trustee or the Certificate Registrar if not the
same Person as the Trustee of any change or impending change in its
status as a Permitted Transferee.
44
<PAGE>
(B) In connection with any proposed Transfer of any Ownership
Interest in a Residual Certificate to a U.S. Person, the Trustee or
the Certificate Registrar if not the same Person as the Trustee
shall require delivery to it, and shall not register the Transfer of
any Residual Certificate until its receipt of (1) an affidavit and
agreement (a "Transferee Affidavit and Agreement") attached hereto
as Exhibit E from the proposed Transferee, in form and substance
satisfactory to the Depositor, representing and warranting, among
other things, that it is not a Non-U.S. Person, that such transferee
is a Permitted Transferee, that it is not acquiring its Ownership
Interest in the Residual Certificate that is the subject of the
proposed Transfer as a nominee, trustee or agent for any Person who
is not a Permitted Transferee, that for so long as it retains its
Ownership Interest in a Residual Certificate, it will endeavor to
remain a Permitted Transferee, and that it has reviewed the
provisions of this Section 4.1(c) and agrees to be bound by them,
and (2) a certificate, attached hereto as Exhibit D, from the Holder
wishing to transfer the Residual Certificate, in form and substance
satisfactory to the Depositor, representing and warranting, among
other things, that no purpose of the proposed Transfer is to allow
such Holder to impede the assessment or collection of tax.
(C) Notwithstanding the delivery of a Transferee Affidavit and
Agreement by a proposed Transferee under clause (B) above, if the
Trustee or the Certificate Registrar if not the same Person as the
Trustee has actual knowledge that the proposed Transferee is not a
Permitted Transferee, no Transfer of an Ownership Interest in a
Residual Certificate to such proposed Transferee shall be effected.
(D) Each Person holding or acquiring any Ownership Interest in
a Residual Certificate agrees by holding or acquiring such Ownership
Interest (i) to require a Transferee Affidavit and Agreement from
any other Person to whom such Person attempts to transfer its
Ownership Interest and to provide a certificate to the Trustee or
the Certificate Registrar if not the same Person as the Trustee in
the form attached hereto as Exhibit E; and (ii) to provide a
certificate to the Trustee or the Certificate Registrar if not the
same Person as the Trustee in the form attached hereto as Exhibit D.
(ii) The Trustee or the Certificate Registrar if not the same Person
as the Trustee shall register the Transfer of any Residual Certificate
only if it shall have received the Transferee Affidavit and Agreement, a
certificate of the Holder requesting such transfer in the form attached
hereto as Exhibit D and all of such other documents as shall have been
reasonably required by the Trustee or the Certificate Registrar if not the
same Person as the Trustee as a condition to such registration.
(iii) (A) If any Disqualified Organization shall become a Holder of
a Residual Certificate, then the last preceding Permitted Transferee shall
be restored, to the extent
45
<PAGE>
permitted by law, to all rights and obligations as Holder thereof
retroactive to the date of registration of such Transfer of such Residual
Certificate. If any Non-U.S. Person shall become a Holder of a Residual
Certificate, then the last preceding Holder which is a U.S. Person shall
be restored, to the extent permitted by law, to all rights and obligations
as Holder thereof retroactive to the date of registration of the Transfer
to such Non-U.S. Person of such Residual Certificate. If a transfer of a
Residual Certificate is disregarded pursuant to the provisions of Treasury
Regulations Section 1.860E-1 or Section 1.860G-3, then the last preceding
Permitted Transferee shall be restored, to the extent permitted by law, to
all rights and obligations as Holder thereof retroactive to the date of
registration of such Transfer of such Residual Certificate. The Trustee,
the Certificate Administrator, the Certificate Registrar and the Paying
Agent shall be under no liability to any Person for any registration of
Transfer of a Residual Certificate that is in fact not permitted by this
Section 4.1(c) or for making any payments due on such Certificate to the
Holder thereof or for taking any other action with respect to such Holder
under the provisions of this Agreement.
(B) If any purported Transferee shall become a Holder of the
Residual Certificate in violation of the restrictions in this
Section 4.1(c) and to the extent that the retroactive restoration of
the rights of the Holder of such Residual Certificate as described
in clause (iii)(A) above shall be invalid, illegal or unenforceable,
then the Depositor shall have the right, without notice to the
Holder or any prior Holder of such Residual Certificate, to sell
such Residual Certificate to a purchaser selected by the Depositor
on such terms as the Depositor may choose. Such purported Transferee
shall promptly endorse and deliver the Residual Certificate in
accordance with the instructions of the Depositor. Such purchaser
may be the Depositor itself or any affiliate of the Depositor. The
proceeds of such sale, net of the commissions (which may include
commissions payable to the Depositor or its affiliates), expenses
and taxes due, if any, shall be remitted by the Depositor to such
purported Transferee. The terms and conditions of any sale under
this clause (iii)(B) shall be determined in the sole discretion of
the Depositor, and the Depositor shall not be liable to any Person
having an Ownership Interest in the Residual Certificate as a result
of its exercise of such discretion.
(iv) The Depositor, on behalf of the Trustee, shall make available,
upon written request from the Trustee, or the Certificate Administrator
all information necessary to compute any tax imposed (A) as a result of
the Transfer of an Ownership Interest in the Residual Certificate to any
Person who is not a Permitted Transferee, including the information
regarding "excess inclusions" of such Residual Certificate required to be
provided to the Internal Revenue Service and certain Persons as described
in Treasury Regulation Section 1.860D-1(b)(5), and (B) as a result of any
regulated investment company, real estate investment trust, common trust
fund, partnership, trust, estate or organizations described in Section
1381 of the Code having as among its record holders at any time any Person
who is not a Permitted Transferee.
46
<PAGE>
Reasonable compensation for providing such information may be required by
the Depositor from such Person.
(v) The provisions of this Section 4.1 set forth prior to this
Section 4.1(c)(v) may be modified, added to or eliminated, provided, that
there shall have been delivered to the Trustee and the Certificate
Administrator the following:
(A) written notification from the Rating Agency to the effect
that the modification, addition to or elimination of such provisions
will not cause such Rating Agency to downgrade its then-current
Ratings of the Certificates; and
(B) an Opinion of Counsel, in form and substance satisfactory
to the Depositor (as evidenced by a certificate of the Depositor),
to the effect that such modification, addition to or absence of such
provisions will not cause the Trust Fund to cease to qualify as a
REMIC and will not create a risk that (1) the Trust Fund may be
subject to an entity-level tax caused by the Transfer of any
Residual Certificate to a Person which is not a Permitted Transferee
or (2) a Certificateholder or another Person will be subject to a
REMIC-related tax caused by the Transfer of a Residual Certificate
to a Person which is not a Permitted Transferee.
(vi) The following legend shall appear on all Residual Certificates:
ANY RESALE, TRANSFER OR OTHER DISPOSITION OF THIS CERTIFICATE
MAY BE MADE ONLY IF THE PROPOSED TRANSFEREE PROVIDES A
TRANSFEREE AFFIDAVIT AND AGREEMENT TO THE DEPOSITOR, THE
TRUSTEE AND THE CERTIFICATE REGISTRAR THAT (1) SUCH TRANSFEREE
IS NOT EITHER (A) THE UNITED STATES, ANY STATE OR POLITICAL
SUBDIVISION THEREOF, ANY FOREIGN GOVERNMENT, ANY INTERNATIONAL
ORGANIZATION, OR ANY AGENCY OR INSTRUMENTALITY OF ANY OF THE
FOREGOING, (B) ANY ORGANIZATION (OTHER THAN A COOPERATIVE
DESCRIBED IN SECTION 521 OF THE CODE) WHICH IS EXEMPT FROM THE
TAX IMPOSED BY CHAPTER 1 OF THE CODE UNLESS SUCH ORGANIZATION
IS SUBJECT TO THE TAX IMPOSED BY SECTION 511 OF THE CODE, (C)
ANY ORGANIZATION DESCRIBED IN SECTION 1381(a)(2)(C) OF THE
CODE (ANY SUCH PERSON DESCRIBED IN THE FOREGOING CLAUSES (A),
(B), OR (C) BEING HEREINAFTER REFERRED TO AS A "DISQUALIFIED
ORGANIZATION"), OR (D) AN AGENT OF A DISQUALIFIED ORGANIZATION
AND (2) NO PURPOSE OF SUCH TRANSFER IS TO
47
<PAGE>
ENABLE THE TRANSFEROR TO IMPEDE THE ASSESSMENT OR COLLECTION
OF TAX. SUCH AFFIDAVIT SHALL INCLUDE CERTAIN REPRESENTATIONS
AS TO THE FINANCIAL CONDITION OF THE PROPOSED TRANSFEREE.
NOTWITHSTANDING THE REGISTRATION IN THE CERTIFICATE REGISTER
OF ANY TRANSFER, SALE OR OTHER DISPOSITION OF THIS CLASS R
CERTIFICATE TO A DISQUALIFIED ORGANIZATION OR AN AGENT OF A
DISQUALIFIED ORGANIZATION, SUCH REGISTRATION SHALL BE DEEMED
TO BE OF NO LEGAL FORCE OR EFFECT WHATSOEVER AND SUCH PERSON
SHALL NOT BE DEEMED TO BE A CERTIFICATEHOLDER FOR ANY PURPOSE
HEREUNDER, INCLUDING, BUT NOT LIMITED TO, THE RECEIPT OF
DISTRIBUTIONS ON THIS CERTIFICATE. EACH HOLDER OF THE CLASS R
CERTIFICATE BY ACCEPTANCE OF THIS CERTIFICATE SHALL BE DEEMED
TO HAVE CONSENTED TO THE PROVISIONS OF THIS PARAGRAPH.
(vii) The Holder of the Class R Certificate issued hereunder, while
not a Disqualified Organization, is the Tax Matters Person.
(d) (i) No Class of Certificates may be acquired directly or indirectly by
an employee benefit plan (within the meaning of Section 3(3) of ERISA, subject
to the prohibited transaction provisions of ERISA ("Plan"), or a plan (within
the meaning of Section 4975(e)(1) of the Code subject to Section 4975 of the
Code (also a "Plan"). By acquiring a Certificate, the holder will be required to
represent that it is not a Plan and is not using the assets of a Plan to effect
such purchase.
(ii) Any Person acquiring an interest in a Book-Entry Certificate by
acquisition of such Certificate, shall be deemed to have represented to
the Trustee that it meets the requirements of this Section 4.1(d).
(iii) If any proposed Transferee shall become a Holder of a
Certificate in violation of these provisions, then the last preceding
permitted transferee shall be restored, to the extent permitted by law, to
all rights as holder thereof retroactive to the date of registration of
such transfer of such Certificate. The Trustee shall be under no liability
to any person for any registration or transfer of a Certificate that is
not permitted or for making any payments due on such Certificate to the
Holder or taking any other action with respect to such Holder under this
Agreement. Any proposed Transferee who becomes a Holder of a Definitive
Certificate shall agree to indemnify (or, in the case of a Book-Entry
Certificate, shall be deemed to agree to indemnify) the Trustee, the
servicers and the trustees with respect to the Pooled Securities against
any loss, damage or penalty incurred as a result of the transfer of any
Certificate to such purposed transferee in violation of such restrictions.
48
<PAGE>
(e) None of the Trustee, the Certificate Administrator, the Certificate
Registrar or the Paying Agent shall have any liability to the Trust Fund arising
from a registration or transfer of a Certificate in reliance upon a
certification, Officer's Certificate, affidavit, ruling or Opinion of Counsel
described in this Section 4.1.
Section 4.2. Certificates Issuable in Classes; Distributions of Principal
and Interest; Authorized Denominations. The aggregate principal amount of
Certificates that may be authenticated and delivered under this Agreement is
limited to the aggregate Pooled Security Information Date Principal Balance, as
specified in the Preliminary Statement to this Agreement, except for
Certificates authenticated and delivered upon registration of transfer of, or in
exchange for, or in lieu of, other Certificates pursuant to Section 4.3. Such
aggregate principal amount shall be allocated among one or more Classes having
designations, types of interests, initial per annum Remittance Rates, initial
Class Principal Balances, initial Component Principal Balances and last
scheduled Distribution Dates as specified in the Preliminary Statement to this
Agreement. Certificates shall be issued in Authorized Denominations.
Section 4.3. Registration of Transfer and Exchange of Certificates. The
Trustee shall cause to be maintained at one of its offices or at its designated
Certificate Registrar, a Certificate Register in which there shall be recorded
the name and address of each Certificateholder. Subject to such reasonable rules
and regulations as the Trustee may prescribe, the Certificate Register shall be
amended from time to time by the Trustee or its agent to reflect notice of any
changes received by the Trustee or its agent pursuant to Section 8.5. The
Trustee hereby appoints itself as the initial Certificate Registrar. The Trustee
may appoint an Eligible Institution to act as its agent in order to delegate to
such Eligible Institution its duties as Certificate Registrar under this
Agreement.
Upon surrender for registration of transfer of any Certificate to the
Trustee at its Corporate Trust Office, or such other address or agency as may
hereafter be provided to the Certificate Administrator, if any, in writing by
the Trustee, the Trustee shall execute, and the Trustee or any Authenticating
Agent shall authenticate and deliver, in the name of the designated transferee
or transferees, one or more new Certificates of Authorized Denominations of like
Percentage Interest. At the option of the Certificateholders, Certificates may
be exchanged for other Certificates in Authorized Denominations of like
Percentage Interest, upon surrender of the Certificates to be exchanged at any
such office or agency. Whenever any Certificates are so surrendered for
exchange, the Trustee shall execute, and the Trustee, or any Authenticating
Agent, shall authenticate and deliver, the Certificates which the
Certificateholder making the exchange is entitled to receive. Every Certificate
presented or surrendered for transfer shall (if so required by the Trustee or
any Authenticating Agent) be duly endorsed by, or be accompanied by a written
instrument of transfer in form satisfactory to the Trustee or any Authenticating
Agent and duly executed by, the Holder thereof or such Holder's attorney duly
authorized in writing.
49
<PAGE>
A reasonable service charge may be made for any such exchange or transfer
of Certificates, and the Trustee or an Authenticating Agent may require payment
of a sum sufficient to cover any tax or governmental charge that may be imposed
in connection with any exchange or transfer of Certificates.
All Certificates surrendered for exchange or transfer shall be cancelled
by the Trustee or any Authenticating Agent.
Section 4.4. Mutilated, Destroyed, Lost or Stolen Certificates. If (i) any
mutilated Certificate is surrendered to the Trustee or any Authenticating Agent,
or (ii) the Trustee or any Authenticating Agent receives evidence to their
satisfaction of the destruction, loss or theft of any Certificate, and there is
delivered to the Trustee or any Authenticating Agent such security or indemnity
as may be required by them to save each of them harmless, then, in the absence
of notice to the Trustee or any Authenticating Agent that such Certificate has
been acquired by a bona fide purchaser, the Trustee shall execute and the
Trustee or any Authenticating Agent shall authenticate and deliver, in exchange
for or in lieu of any such mutilated, destroyed, lost or stolen Certificate, a
new Certificate of like Percentage Interest. Upon the issuance of any new
Certificate under this Section 4.4, the Trustee or any Authenticating Agent 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 or any Authenticating Agent) connected
therewith. Any replacement Certificate issued pursuant to this Section 4.4 shall
constitute complete and indefeasible evidence of ownership in the Trust Fund, as
if originally issued, whether or not the lost or stolen Certificate shall be
found at any time.
Section 4.5. Persons Deemed Owners. The Depositor, the Certificate
Administrator, the Trustee and any agent of any of them may treat the Person in
whose name any Certificate is registered as the owner of such Certificate for
the purpose of receiving distributions pursuant to Section 4.5 and for all other
purposes whatsoever, and neither the Depositor, the Certificate Administrator,
if any, the Trustee, the Certificate Registrar nor any agent of the Depositor,
the Certificate Administrator, if any, or the Trustee shall be affected by
notice to the contrary.
Section 4.6. Temporary Certificates. Upon the initial issuance of the
Certificates, the Trustee may execute, and the Trustee or any Authenticating
Agent shall authenticate and deliver, temporary Certificates which are printed,
lithographed, typewritten or otherwise produced, in any Authorized Denomination,
of the tenor of the definitive Certificates in lieu of which they are issued and
with such variations in form from the forms of the Certificates set forth as
Exhibits A and B hereto as the Trustee's officers executing such Certificates
may determine, as evidenced by their execution of the Certificates.
Notwithstanding the foregoing, the Certificates may remain in the form set forth
in this Section.
If temporary Certificates are issued, the Trustee shall cause definitive
Certificates to be prepared within ten Business Days of the Closing Date or as
soon as practicable thereafter. After
50
<PAGE>
preparation of definitive Certificates, the temporary Certificates shall be
exchangeable for definitive Certificates upon surrender of the temporary
Certificates at the office or agency of the Trustee to be maintained as provided
in Section 5.10 hereof, without charge to the Holder. Any tax or governmental
charge that may be imposed in connection with any such exchange shall be borne
by the Depositor. Upon surrender for cancellation of any one or more temporary
Certificates, the Trustee shall execute and the Trustee or any Authenticating
Agent shall authenticate and deliver in exchange therefor a like principal
amount of definitive Certificates of Authorized Denominations. Until so
exchanged, the temporary Certificates shall in all respects be entitled to the
same benefits under this Agreement as definitive Certificates.
Section 4.7. Book-Entry for Book-Entry Certificates. Notwithstanding the
foregoing, the Book-Entry Certificates, upon original issuance, shall be issued
in the form of one or more typewritten Certificates of Authorized Denomination
representing the Book-Entry Certificates, to be delivered to DTC, the initial
Clearing Agency, by, or on behalf of, the Depositor. The Book-Entry Certificates
shall initially be registered on the Certificate Register in the name of Cede &
Co., the nominee of DTC, as the initial Clearing Agency, and no Beneficial
Holder shall receive a definitive certificate representing such Beneficial
Holder's interest in any Class of Book-Entry Certificate, except as provided
above and in Section 4.9. Each Book-Entry Certificate shall bear the following
legend:
Unless this Certificate is presented by an authorized representative of
The Depository Trust Company, a New York corporation ("DTC"), to the
Trustee or its agent for registration of transfer, exchange, or payment,
and any Certificate issued is registered in the name of Cede & Co. or such
other name as is requested by an authorized representative of DTC (and any
payment is made to Cede & Co. or to such other entity as is requested by
an authorized representative of DTC), ANY TRANSFER, PLEDGE OR OTHER USE
HEREOF FOR VALUE OR OTHERWISE BY OR TO ANY PERSON IS WRONGFUL inasmuch as
the registered owner hereof, Cede & Co., has an interest herein.
Unless and until definitive, fully registered Book-Entry Certificates (the
"Definitive Certificates") have been issued to the Beneficial Holders pursuant
to Section 4.9:
(a) the provisions of this Section 4.7 shall be in full force and effect
with respect to the Book-Entry Certificates;
(b) the Certificate Administrator, if any, and the Trustee may deal with
the Clearing Agency for all purposes with respect to the Book-Entry Certificates
(including the making of distributions on the Book-Entry Certificates) as the
sole Certificateholder;
51
<PAGE>
(c) to the extent that the provisions of this Section 4.7 conflict with
any other provisions of this Agreement, the provisions of this Section 4.7 shall
control; and
(d) the rights of the Beneficial Holders shall be exercised only through
the Clearing Agency and the DTC Participants and shall be limited to those
established by law and agreements between such Beneficial Holders and the
Clearing Agency and/or the DTC Participants. Pursuant to the Depositary
Agreement, unless and until Definitive Certificates are issued pursuant to
Section 4.9, the initial Clearing Agency will make book-entry transfers among
the DTC Participants and receive and transmit distributions of principal and
interest on the related Class of Book-Entry Certificates to such DTC
Participants.
For purposes of any provision of this Agreement requiring or permitting
actions with the consent of, or at the direction of, Holders of Book-Entry
Certificates evidencing a specified Percentage Interest, such direction or
consent may be given by the Clearing Agency at the direction of Beneficial
Holders owning Book-Entry Certificates evidencing the requisite Percentage
Interest represented by the Book-Entry Certificates. The Clearing Agency may
take conflicting actions with respect to the Book-Entry Certificates to the
extent that such actions are taken on behalf of the Beneficial Holders.
Section 4.8. Notices to Clearing Agency. Whenever notice or other
communication to the Certificateholders is required under this Agreement, unless
and until Definitive Certificates shall have been issued to the related
Certificateholders pursuant to Section 4.9, the Trustee shall give all such
notices and communications specified herein to be given to Holders of the
Book-Entry Certificates to the Clearing Agency which shall give such notices and
communications to the related DTC Participants in accordance with its applicable
rules, regulations and procedures.
Section 4.9. Definitive Certificates. If (a) the Clearing Agency notifies
the Certificate Administrator, if any, or the Trustee that it is no longer
willing or able to discharge properly its responsibilities under the Depositary
Agreement with respect to the Book-Entry Certificates and the Trustee or the
Certificate Administrator is unable to locate a qualified successor, (b) the
Depositor, at its option, advises the Certificate Administrator, if any, or the
Trustee in writing that it elects to terminate the book-entry system with
respect to the Book-Entry Certificates through the Clearing Agency or (c)
Certificateholders holding Book-Entry Certificates evidencing Percentage
Interests aggregating not less than 66% of the aggregate Class Principal Balance
of such Certificates advise the Certificate Administrator, if any, or the
Trustee and the Clearing Agency through DTC Participants in writing that the
continuation of a book-entry system with respect to the Book-Entry Certificates
through the Clearing Agency is no longer in the best interests of the
Certificateholders with respect to such Certificates, the Trustee shall notify
or cause to be notified all Certificateholders of Book-Entry Certificates of the
occurrence of any such event and of the availability of Definitive Certificates.
Upon surrender to the Trustee of the Book-Entry Certificates by the Clearing
Agency, accompanied by registration instructions from the Clearing Agency for
registration, the Trustee shall execute and the Trustee or any Authenticating
Agent shall authenticate and deliver the Definitive Certificates. Neither
52
<PAGE>
the Depositor, the Certificate Administrator, if any, the Authenticating Agent
nor the Trustee shall be liable for any delay in delivery of such instructions
and may conclusively rely on, and shall be protected in relying on, such
instructions. Upon the issuance of Definitive Certificates for all of the
Certificates all references herein to obligations imposed upon or to be
performed by the Clearing Agency shall be deemed to be imposed upon and
performed by the Trustee, the Certificate Administrator, if any, and the
Trustee, the Certificate Administrator, the Certificate Registrar and the Paying
Agent shall recognize the Holders of Definitive Certificates as
Certificateholders hereunder.
Section 4.10. Office for Transfer of Certificates. The Trustee shall
maintain in New York, an office or agency where Certificates may be surrendered
for registration of transfer or exchange. The Trustee's Corporate Trust Office
is initially designated for said purposes.
ARTICLE V
THE DEPOSITOR
Section 5.1. Liability of the Depositor. The Depositor shall be liable in
accordance herewith only to the extent of the obligations specifically imposed
by this Agreement and undertaken hereunder by the Depositor herein.
Section 5.2. Merger or Consolidation of the Depositor. Subject to the
following paragraph, the Depositor will keep in full effect its existence,
rights and franchises as a corporation, under the laws of the jurisdiction of
its incorporation, and will obtain and preserve its qualification to do business
as a foreign corporation in each jurisdiction in which such qualification is or
shall be necessary to protect the validity and enforceability of this Agreement,
the Certificates or any of the Pooled Securities and to perform its respective
duties under this Agreement.
The Depositor may be merged or consolidated with or into any Person, or
transfer all or substantially all of its assets to any Person, in which case any
Person resulting from any merger or consolidation to which the Depositor shall
be a party, or any Person succeeding to the business of the Depositor, shall be
the successor of the Depositor hereunder, without the execution or filing of any
paper or any further act on the part of any of the parties hereto, anything
herein to the contrary notwithstanding.
Section 5.3. Limitation on Liability of the Depositor and Others. Neither
the Depositor nor any of the directors, officers, employees or agents of the
Depositor shall be under any liability to the Trust Fund or the
Certificateholders for any action taken or for refraining from the taking of any
action in good faith pursuant to this Agreement, or for errors in judgment;
provided, however, that this provision shall not protect any director, officer,
employee or agent of the Depositor against any liability which would otherwise
be imposed by reason of willful misfeasance, bad faith or gross negligence in
the
53
<PAGE>
performance of duties or by reason of reckless disregard of obligations and
duties hereunder, nor shall this provision protect the Depositor against any
liability that would otherwise be imposed by reason of negligence in the
performance of duties hereunder. The Depositor and any director, officer,
employee or agent of the Depositor may rely in good faith on any document of any
kind prima facie properly executed and submitted by any Person respecting any
matters arising hereunder. The Depositor and any director, officer, employee or
agent of the Depositor shall be indemnified by the Trust Fund and held harmless
against any loss, liability or expense incurred in connection with any legal
action relating to this Agreement or the Certificates, other than any loss,
liability or expense, in the case of the Depositor and any director, officer,
employee or agent of the Depositor, 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 or, in the case
of the Depositor, as Depositor, incurred by reason of negligence in the
performance of any duties hereunder. The Depositor shall not be under any
obligation to appear in, prosecute or defend any legal action which is not
incidental to its duties to service the Loans in accordance with this Agreement
and which in its opinion may involve it in any expense or liability; provided,
however, that the Depositor may in its discretion undertake any such action
which it may deem necessary or desirable in respect of this Agreement and the
rights and duties of the parties hereto and the interests of the
Certificateholders hereunder. In such event, the 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 shall be entitled to be
reimbursed therefor out of the Certificate Account.
ARTICLE VI
CONCERNING THE TRUSTEE
Section 6.1. Duties of Trustee. The Trustee undertakes to perform such
duties and only such duties as are specifically set forth in this Agreement. Any
permissive right of the Trustee enumerated in this Agreement shall not be
construed as a duty.
Subject to Sections 6.2(i), 6.3 and 6.4, the Trustee, upon receipt of all
resolutions, certificates, statements, opinions, reports, documents, orders or
other instruments furnished to the Trustee which are specifically required to be
furnished pursuant to any provision of this Agreement, shall examine them to
determine whether they are in the form required by this Agreement; provided,
however, that the Trustee shall not be responsible for the accuracy or content
of any resolution, certificate, statement, opinion, report, document, order,
Pooled Security Distribution Date Statement or other instrument furnished by any
party hereunder. If any such instrument is found not to conform to the
requirements of this Agreement in a material manner, the Trustee shall take
action as it deems appropriate to have the instrument corrected, and if the
instrument is not corrected to the Trustee's reasonable satisfaction, the
Trustee will provide notice thereof to the Certificateholders and the Rating
Agency.
54
<PAGE>
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:
(i) The duties and obligations of the Trustee shall be determined
solely by the express provisions of this Agreement, the Trustee shall not
be liable except for the performance of such duties and obligations as are
specifically set forth in this Agreement, no implied covenants or
obligations shall be read into this Agreement against the Trustee and, in
the absence of bad faith on the part of the Trustee, the Trustee may
conclusively rely, as to the truth of the statements and the correctness
of the opinions expressed therein, upon any certificates or opinions
furnished to the Trustee and conforming to the requirements of this
Agreement;
(ii) The Trustee shall not be personally liable with respect to any
action taken, suffered or omitted to be taken by it in good faith in
accordance with this Agreement or at the direction of Certificateholders
holding Certificates which have an aggregate Certificate Principal Balance
aggregating not less than 25% of the aggregate Certificate Principal
Balance of all Certificates relating to the time, method and place of
conducting any proceeding for any remedy available to the Trustee, or
exercising or omitting to exercise any trust or power conferred upon the
Trustee, under this Agreement;
(iii) The Trustee shall not be liable in its individual capacity for
any error of judgment made in good faith by any Responsible Officer,
unless it shall be proved that the Trustee or such Responsible Officer was
negligent in ascertaining the pertinent facts;
(iv) The Trustee shall not be liable for any act or omission of the
Depositor or for any but its own acts or omissions;
(v) The Trustee shall not be deemed to take notice or be deemed to
have knowledge of any matter unless written notice thereof, referring to
the Certificates, the Depositor, the Trust Fund or this Agreement is
received by a Responsible Officer of the Trustee at its Corporate Trust
Office; and
(vi) Subject to the other provisions of this Agreement and without
limiting the generality of this Section 6.1, the Trustee shall have no
duty (A) to see to any recording, filing, or depositing of this Agreement
or any agreement referred to herein or any financing statement or
continuation statement evidencing a security interest, or to see to the
maintenance of any such recording or filing or depositing or to any
rerecording, refiling or redepositing of any thereof, (B) to see to any
insurance, and (C) to see to the payment or discharge of any tax,
assessment, or other governmental charge or any lien or encumbrance of any
kind owing with respect to, assessed or levied against, any part of the
Trust Fund other than from funds available in the Certificate Account.
55
<PAGE>
None of the provisions contained in this Agreement shall require the
Trustee to expend or risk its own funds or otherwise incur financial liability
in the performance of any of its duties as Trustee hereunder or in the exercise
of any of its rights or powers if there is reasonable ground for believing that
repayment of such funds or adequate indemnity against such risk or liability is
not reasonably assured to it.
Section 6.2. Certain Matters Affecting Trustee. Except as otherwise
provided in Section 6.1:
(i) Before acting or refraining from acting the Trustee may request
or require an Officer's Certificate; the Trustee may rely and shall be
protected in acting or refraining from acting upon any resolution,
Officer's Certificate, opinion of counsel, certificate of auditors or any
other certificate, statement, instrument, opinion, report, notice,
request, consent, order, appraisal, bond or other paper or document
believed by it to be genuine and to have been signed or presented by the
proper party or parties;
(ii) The Trustee may consult with counsel, and any advice or Opinion
of Counsel shall be full and complete authorization and protection in
respect of any action taken or suffered or omitted by it hereunder in good
faith and in accordance with such advice or Opinion of Counsel;
(iii) The Trustee shall not be personally liable for any action
taken, suffered or omitted by it in good faith and believed by it to be
authorized or within the discretion or rights or powers conferred upon it
by this Agreement;
(iv) The right of the Trustee to perform any discretionary act
enumerated in this Agreement shall not be construed as a duty, and the
Trustee shall not be answerable for other than its negligence or willful
misconduct in the performance of such act;
(v) The Trustee shall not be required to give any bond or surety in
respect of the execution of the Trust Fund created hereby or the powers
granted hereunder; and
(vi) The Trustee may execute any of the trusts or powers hereunder
or perform any duties hereunder either directly or by or through agents,
attorneys or custodians, and the Trustee shall not be responsible for any
misconduct or negligence on the part of any such agent, attorney or
custodian appointed by the Trustee with care. Any such agents, attorneys
or custodians shall be entitled to all indemnities and protection afforded
to the Trustee. Any designee of the Trustee shall be considered its
"agent" hereunder whether performing it as an independent contractor or
otherwise.
56
<PAGE>
Section 6.3. Trustee Not Required to Make Investigation. The Trustee shall
not be bound to ascertain or inquire as to the performance or observance of any
of the terms, conditions, covenants or agreements herein or to make any
investigation into the facts or matters stated in any resolution, certificate,
statement, instrument, opinion, report, notice, request, consent, order,
approval, bond, Pooled Security Distribution Date Statement or other paper or
document, unless requested in writing so to do by Holders of Certificates having
a Percentage Interest not less than 51% of the Trust Fund; provided, however,
that if the payment within a reasonable time to the Trustee of the costs,
expenses or liabilities likely to be incurred by it in the making of such
investigation is, in the opinion of the Trustee, not reasonably assured to the
Trustee by the security afforded to it by the terms of this Agreement, the
Trustee may require reasonable indemnity against such expense or liability as a
condition to such proceeding. The reasonable expense of every such examination
shall be paid by the Depositor or, if paid by the Trustee, shall be repaid by
the Depositor upon demand.
Section 6.4. Trustee Not Liable for Certificates or Pooled Securities. The
recitals contained herein and in the Certificates (other than the certificate of
authentication on the Certificates) shall be taken as the statements of the
Depositor, and the Trustee assumes no responsibility for the correctness of the
same. The Trustee makes no representations or warranties as to the validity or
sufficiency of this Agreement or of the Certificates or of any Pooled Security,
Pooled Security Distribution Date Statement or related document. The Trustee
shall not be accountable for the use or application by the Depositor of any of
the Certificates or of the proceeds of such Certificates. The Trustee shall not
be responsible for the legality or validity of this Agreement or the validity,
priority, perfection or sufficiency of the security for the Certificates issued
or intended to be issued hereunder. The Trustee shall have no responsibility for
filing any financing or continuation statement in any public office at any time
or to otherwise perfect or maintain the perfection of any security interest or
lien granted to it hereunder or to record this Agreement.
Neither the Trustee nor any of the directors, officers, employees or
agents of the Trustee shall be under any liability to the Trust Fund or the
Certificateholders for any action taken or for refraining from the taking of any
action in good faith pursuant to this Agreement; provided, however, that this
provision shall not protect the Trustee or any such person against any liability
which would otherwise be imposed by reason of willful misfeasance, bad faith or
negligence in the performance of duties. The Trustee and any director, officer,
employee or agent of the Trustee shall be indemnified by the Depositor and held
harmless against any loss, liability or expense, including reasonable attorneys'
fees, incurred in connection with or related to the Trustee's performance of its
powers and duties under this Agreement (including, without limitation,
performance under Section 6.1 hereof), or any action relating to this Agreement
or the Certificates, or the performance of the Trustee's duties hereunder, other
than any loss, liability or expense incurred by any such Person by reason of
willful misfeasance, bad faith or negligence in the performance of duties. Any
such losses, liabilities and expenses resulting therefrom shall be losses,
liabilities and expenses of the Depositor. The indemnification provided
hereunder shall survive termination of this Agreement and the resignation or
removal of the Trustee.
57
<PAGE>
Section 6.5. Trustee May Own Certificates. The Trustee and any agent of
the Trustee in its individual or any other capacity may become the owner of or a
pledgee of the Certificates with the same rights it would have if it were not
Trustee or such agent, and may otherwise deal with the parties hereto.
Section 6.6. Indemnification of Trustee. Subject to the provisions of this
paragraph, the Trustee and any director, officer, employee or agent of the
Trustee shall be entitled to be indemnified and held harmless by the Trust
against any loss, liability or expense (including, without limitation, costs and
expenses of litigation, and of investigation, counsel fees and expenses,
damages, judgments, amounts paid in settlement and out-of-pocket expenses)
arising out of, or incurred in connection with, the exercise and performance of
any of the powers and duties of the Trustee hereunder; provided that neither the
Trustee nor any of the other above specified Persons shall be entitled to
indemnification pursuant to this Section 6.6 for (i) allocable overhead, (ii)
expenses or disbursements incurred or made by or on behalf of the Trustee in the
normal course of the Trustee's performing routine administrative duties in
accordance with any of the provisions hereof, (iii) any expense or liability
specifically required to be borne thereby pursuant to the terms hereof, or (iv)
any loss, liability or expense incurred by reason of willful misfeasance, bad
faith or negligence in the performance of the Trustee's obligations and duties
hereunder, or by reason of reckless disregard of such obligations or duties, or
as may arise from a breach of any representation, warranty or covenant of the
Trustee made herein. The Tax Matters Person (or Person acting as its
attorney-in-fact or agent) shall indemnify the Trustee for any liability of or
assessment against the Trustee resulting from any error in any tax or tax
information returns prepared or caused to be prepared by such Person.
The provisions of this Section 6.6 shall survive any resignation or
removal of the Trustee and appointment of a successor trustee and the
termination of this Agreement.
Section 6.7. Eligibility Requirements for Trustee. The Trustee hereunder
shall at all times be a corporation or association organized and doing business
under the laws of any state of 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 and subject to supervision or examination by
federal or state authority. 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 6.7 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 6.7, the
Trustee shall resign immediately in the manner and with the effect specified in
Section 6.8.
Section 6.8. Resignation and Removal of 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. Such notice shall also be furnished to
the Rating Agency. Upon receiving such notice of resignation, the Depositor
shall promptly appoint a successor trustee by written instrument, in duplicate,
one copy of
58
<PAGE>
which instrument shall be delivered to the resigning Trustee and one copy to the
successor trustee. If no successor trustee shall have been so appointed and have
accepted appointment within 30 days after the giving of such notice of
resignation, the resigning Trustee may petition any court of competent
jurisdiction for the appointment of a successor trustee at the expense of the
Depositor.
If at any time the Trustee shall cease to be eligible in accordance with
the provisions of Section 6.7 and shall fail to resign after written request for
the Trustee's resignation by the Depositor, or if at any time the Trustee shall
become incapable of acting, or shall be adjudged bankrupt or insolvent, or a
receiver of the Trustee or of its property shall be appointed, or any public
officer shall take charge or control of the Trustee or of its property or
affairs for the purpose of rehabilitation, conservation or liquidation, then,
with or without cause, the Depositor may remove the Trustee and appoint a
successor trustee by written instrument, in duplicate, one copy of which
instrument shall be delivered to the Trustee so removed and one copy to the
successor trustee.
The Holders of Certificates having a Percentage Interest aggregating not
less than 51% of the aggregate Denomination of all Certificates 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 instrument or instruments shall be
delivered to the Depositor, one complete set to the Trustee so removed and one
complete set to the successor trustee so appointed.
Any resignation or removal of the Trustee and appointment of a successor
trustee pursuant to any of the provisions of this Section 6.8 shall become
effective only upon acceptance of appointment by the successor trustee as
provided in Section 6.9.
Section 6.9. Successor Trustee. Any successor trustee appointed as
provided in Section 6.8 shall execute, acknowledge and deliver to the Depositor
and to its predecessor trustee an instrument accepting such appointment
hereunder, and thereupon the resignation or removal of the predecessor trustee
shall become effective, and such successor trustee, without any further act,
deed or conveyance, shall become fully vested with all the rights, powers,
duties and obligations of its predecessor hereunder, with like effect as if
originally named as trustee herein. The predecessor trustee shall deliver or
cause to be delivered to the successor trustee all Pooled Securities and related
documents and statements held by it hereunder (other than any Pooled Securities
at the time held by the Custodian, if it shall agree to become the agent of any
successor trustee hereunder), and the Depositor and the predecessor trustee
shall execute and deliver such instruments and do such other things as may
reasonably be required for more fully and certainly vesting and confirming in
the successor trustee all such rights, powers, duties and obligations.
No successor trustee shall accept appointment as provided in this Section
6.9 unless at the time of such acceptance such successor trustee shall be
eligible under the provisions of Section 6.7.
59
<PAGE>
Upon acceptance of appointment by a successor trustee as provided in
this Section 6.9, the successor trustee shall mail notice of the succession of
such trustee hereunder to all holders of Certificates at their addresses as
shown in the Certificate Register and to the Rating Agency.
Section 6.10. Merger or Consolidation of Trustee. Any Person into
which the Trustee may be merged or converted or with which it may be
consolidated, or any Person resulting from any merger, conversion or
consolidation to which the Trustee shall be a party, or any Person succeeding to
all or substantially all of the corporate trust business of the Trustee, shall
be the successor of the Trustee hereunder, provided, that such Person shall be
eligible under the provisions of Section 6.7, without the execution or filing of
any paper or any further act on the part of any of the parties hereto, anything
herein to the contrary notwithstanding.
Section 6.11. Appointment of Co-Trustee or Separate Trustee.
Notwithstanding any other provisions hereof, 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 the same may at the time be located, the Trustee
shall have the power and shall execute and deliver all instruments to appoint
one or more Persons 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, such title to the Trust Fund, or any part thereof, and, subject to the
other provisions of this Section 6.11, such powers, duties, obligations, rights
and trusts as the Trustee may consider necessary or desirable. Each co-trustee
or separate trustee hereunder shall not be required to meet the terms of
eligibility as a successor trustee under Section 6.7 hereunder and no notice to
holders of Certificates of the appointment of co-trustee(s) or separate
trustee(s) shall be required under Section 6.9 hereof.
In the case of any appointment of a co-trustee or separate trustee
pursuant to this Section 6.11, all rights, powers, duties and obligations
conferred or imposed upon the Trustee shall be conferred or imposed upon and
exercised or performed by the Trustee and such separate trustee or co-trustee
jointly, 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),
the Trustee shall be incompetent or unqualified to perform such act or acts, in
which event such rights, powers, duties and obligations (including the holding
of title to the Trust Fund or a portion thereof in any such jurisdiction) shall
be exercised and performed by such separate trustee or co-trustee at the
direction of the Trustee.
Any notice, request or other writing given to the Trustee shall be deemed
to have been given to each of the then separate trustees and co-trustees, as
effectively as if given to each of them. Every instrument appointing any
separate trustee or co-trustee shall refer to this Agreement and the conditions
of this Article VIII. Each separate trustee and co-trustee, upon its acceptance
of the trusts conferred, shall be vested with the estates or property specified
in its instrument of appointment, either jointly with the Trustee or separately,
as may be provided therein, subject to all the provisions of this Agreement,
specifically including every provision of this Agreement relating to the conduct
of, affecting the liability of, or affording protection to, the Trustee. Every
such instrument shall be filed with the Trustee.
60
<PAGE>
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. The Trustee shall not be responsible
for any action or inaction of any such separate trustee or co-trustee. 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.
The Trustee may appoint one or more Eligible Institutions to act as its
agent or agents to perform any or all of its duties and obligations under this
Agreement. Each such agent shall be subject to all of 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.
Section 6.12. Appointment of Custodians. The Trustee may appoint one or
more Custodians, not affiliated with the Depositor, to hold all or a portion of
the Pooled Securities as agent for the Trustee. Any Custodian appointed shall be
an institution subject to supervision by federal or state authority, shall have
combined capital and surplus of at least $50,000,000 and shall be qualified to
do business in the jurisdiction in which it holds any Pooled Securities.
Section 6.13. Authenticating Agent.
(a) The Trustee may appoint from time to time an authenticating
agent (the "Authenticating Agent") which shall be authorized to act on
behalf of the Trustee in authenticating Certificates. Wherever reference
is made in this Agreement to the authentication of Certificates by the
Trustee or the Trustee's certificate of authentication, such reference
shall be deemed to include authentication on behalf of the Trustee by the
Authenticating Agent and a certificate of authentication executed on
behalf of the Trustee by the Authenticating Agent. Any successor
Authenticating Agent must have a principal office and place of business in
New York, New York or Chicago, Illinois, have a combined capital and
surplus of at least $50,000,000, and be authorized to do a trust business
and subject to supervision or examination by federal or state authorities.
(b) Any corporation into which the Authenticating Agent 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 Authenticating Agent shall be a party, or any corporation
succeeding to all or substantially all of the corporate agency business of
the Authenticating Agent, shall continue to be the Authenticating Agent
without the execution or filing of any paper or any further act on the
part of the Trustee or the Authenticating Agent.
(c) The Authenticating Agent may at any time resign by giving at
least 30 days' advance written notice of resignation to the Trustee. The
Trustee may at any time terminate the
61
<PAGE>
agency of the Authenticating Agent by giving written notice of termination
to the Authenticating Agent. Upon receiving a notice of resignation or
upon such a termination, or in case at any time the Authenticating Agent
shall cease to be eligible in accordance with the provisions of this
Section 6.13, the Trustee promptly shall appoint a successor
Authenticating Agent and shall mail notice of such appointment to all
Certificateholders. Any successor Authenticating Agent upon acceptance of
its appointment hereunder shall become vested with all the rights, powers,
duties and responsibilities of its predecessor hereunder, with like effect
as if originally named as Authenticating Agent herein. No successor
Authenticating Agent shall be appointed unless eligible under the
provisions of this Section 6.13.
(d) The Authenticating Agent shall have no responsibility or
liability for any action taken by it as such at the direction of the
Trustee. Any reasonable compensation paid to the Authenticating Agent
shall be a reimbursable expense under Section 6.6.
Section 6.14. Third Party Data Providers. As soon as practicable after the
Closing Date, the Trustee or the Certificate Administrator, if any, will arrange
with Bloomberg, Intex and Yield Book (the "Data Providers") to have the
Depositor set up on these Data Providers to provide the information set forth on
Exhibit G (the "Data") with respect to the Pooled Securities on a monthly basis
in a format acceptable to such Data Providers and acceptable to the
Underwriters. During the term of this Agreement, the Trustee will provide
updated Data to the Data Providers on or before each Distribution Date.
Section 6.15. Reports to Securities and Exchange Commission. Unless
otherwise directed by the Depositor in writing, the Certificate Administrator or
the Trustee, as applicable, shall prepare, sign and file with the Securities and
Exchange Commission, on behalf of the Depositor, (i) no later than ten days
after each Distribution Date, the Certificateholders' Report on the appropriate
form and in the appropriate medium authorized or prescribed therefor under the
Exchange Act, (ii) no later than March 25 of each calendar year, an annual
report meeting the requirements of the Exchange Act on the appropriate form and
in the appropriate medium authorized or prescribed therefor under the Exchange
Act. The Trustee or the Certificate Administrator, as applicable, shall promptly
forward copies of all filings made pursuant to this Section 6.15 to the
Depositor, the New York Stock Exchange, and such other Persons as from time to
time designated in writing to the Trustee or the Certificate Administrator, as
applicable, by the Depositor.
62
<PAGE>
ARTICLE VII
TERMINATION
Section 7.1. Termination upon Purchase by the Depositor or Liquidation of
All Pooled Securities. The obligations and responsibilities of the Trustee
created hereby (other than the obligation to make payments to Certificateholders
as hereafter set forth in this Section 7.1 and obligations to the Trustee in
Sections 7.4 and 7.6) shall terminate upon the earlier of (i) the later of the
final payment or other liquidation of the last Pooled Security remaining in the
Trust Fund or (ii) the purchase by the Depositor of all Pooled Securities at a
price equal to Purchase Price; provided, however, that in no event shall the
trust created hereby continue beyond the expiration of 21 years from the death
of the last survivor of the descendants of Joseph P. Kennedy, the late
ambassador of the United States to the Court of St. James, living on the date
hereof; and provided, further, that a "plan of liquidation" of each of REMIC I
and II in accordance with Section 860F of the Code must be adopted in
conjunction with any termination effected pursuant to subclauses (i), (ii), or
(iii) of this Section 9.1.
The Depositor is hereby granted the right to purchase the Pooled
Securities pursuant to clause (ii) above, provided, however, that such right
shall be conditioned upon the aggregate Principal Balances of such Pooled
Securities, at the time of any such purchase, aggregating an amount less than 5%
of the aggregate Pooled Security Information Date Principal Balance.
Notice of any termination pursuant to clause (i) or (ii) above, specifying
the Distribution Date upon which all Certificateholders may surrender their
Certificates to the Trustee or its agent for payment and cancellation, shall be
given promptly by the Trustee or its agent by letter to Certificateholders and
the Rating Agency mailed by first class mail no later than the 25th day of the
month preceding the month of such final distribution specifying (i) the
Distribution Date upon which final payment on the Certificates will be made upon
presentation and surrender of Certificates at the office or agency of the
Trustee or the Certificate Registrar therein designated, (ii) the amount of any
such final payment and (iii) that the Record Date otherwise applicable to such
Distribution Date is not applicable, payments being made only upon presentation
and surrender of the Certificates at the office or agency of the Trustee or the
Certificate Registrar therein specified. The Trustee or its agent shall give
such notice to the Certificate Registrar and the Rating Agency at the time such
notice is given to the Certificateholders. Upon any such termination, the duties
of the Certificate Registrar shall also terminate. In the event such notice is
given in connection with the Depositor's election to purchase, the Depositor
shall deposit in the Certificate Account on the related Withdrawal Date an
amount equal to the Purchase Price and upon such deposit Certificateholders will
be entitled to the amount of the Purchase Price but not amounts in excess
thereof, all as provided herein. Upon presentation and surrender of the
Certificates pursuant to any termination under this Section 7.1, the Trustee or
Paying Agent shall cause to be distributed to Certificateholders an amount equal
to (a) the amount otherwise distributable on such Distribution Date, if not in
connection with a purchase; or (b) if the Depositor elected to so purchase, the
purchase price calculated as above provided.
63
<PAGE>
In the event that all of the Certificateholders shall not surrender their
Certificates for cancellation within three months after the time specified in
the above-mentioned written notice, the Trustee or its agent 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 three months after the second notice all the Certificates
shall not have been surrendered for cancellation, the Trustee or its agent shall
take appropriate and reasonable steps to contact the remaining
Certificateholders concerning surrender of their Certificates, and the cost
thereof shall be paid out of the funds and other assets which remain in trust
hereunder.
Section 7.2. Trusts Irrevocable. Except as expressly provided herein, all
trusts created hereby are irrevocable.
Section 7.3. Additional Termination Requirements.
(a) In the event the Depositor exercises its purchase option as
provided in Section 7.1, the Trust Fund shall be terminated in accordance
with the following additional requirements, unless the Trustee and the
Certificate Administrator have received an Opinion of Counsel to the
effect that the failure of the Trust Fund to comply with the requirements
of this Section 7.3 will not (i) result in the imposition of taxes on
"prohibited transactions" of REMIC I or REMIC II of the Trust Fund as
described in Section 860F(a)(2) of the Code, or (ii) cause either REMIC I
or REMIC II of the Trust Fund to fail to qualify as a REMIC at any time
that any Certificates are outstanding:
(A) Within 90 days prior to the final Distribution Date set
forth in the notice given by the Depositor under Section 7.1, the
Tax Matters Person shall prepare the documents associated with and
shall adopt a plan of complete liquidation of each of REMIC I and
REMIC II of the Trust Fund; and
(B) At or after the time of adoption of such a plan of
complete liquidation and at or prior to the final Distribution Date,
the Trustee shall sell all of the assets of the Trust Fund to the
Depositor for cash in accordance with such plan of liquidation;
provided, however, that in the event that a calendar quarter ends
after the time of adoption of such a plan of complete liquidation
but prior to the final Distribution Date, the Trustee shall not sell
any of the assets of the Trust Fund prior to the close of that
calendar quarter.
(b) The Tax Matters Person hereby agrees to adopt such a plan of
complete liquidation and to take such other action in connection therewith
as may be reasonably requested by the Trustee.
64
<PAGE>
ARTICLE VIII
MISCELLANEOUS PROVISIONS
Section 8.1. Amendment. This Agreement may be amended from time to time by
the Depositor and the Trustee, without the consent of any of the
Certificateholders, (a) to cure any ambiguity, to correct or supplement any
provision herein which may be inconsistent with any other provision herein, or
to make any other provisions with respect to matters or questions arising under
this Agreement, (b) to modify, eliminate or add to any provisions to such extent
as shall be necessary to maintain the qualification of the Trust Fund as a REMIC
at all times that any Class A or Subordinate Certificates are outstanding,
provided, that the Trustee has received an Opinion of Counsel to the effect that
such action is necessary or desirable to maintain such qualification, provided,
that such action under clauses (a) and (b) above shall not, as evidenced by an
Opinion of Counsel, adversely affect in any material respect the interests of
any Certificateholder or (c) such amendment is made to conform the terms of this
Agreement to the terms described in the Prospectus dated July 27, 1999, together
with the Prospectus Supplement dated July 27, 1999.
This Agreement may also be amended from time to time by the Depositor and
the Trustee with the consent of the Holders of Certificates evidencing, in
aggregate, not less than 50% of the Trust Fund for the purpose of adding any
provisions 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 (a) reduce in any
manner the amount of, or delay the timing of, payments received on Pooled
Securities which are required to be distributed in respect of any Certificate
without the consent of the Holder of such Certificate; (b) adversely affect in
any material respect the interest of the Holders of the Class A Certificates in
a manner other than as described in (a) above without the consent of the Holders
of Class A Certificates aggregating not less than 66-2/3% of the aggregate
Percentage Interest evidenced by all Class A Certificates; (c) adversely affect
in any material respect the interest of the Holders of the Subordinate
Certificates in a manner other than as described in clause (a) above without the
consent of the Holders of Subordinate Certificates aggregating not less than
66-2/3% of the aggregate Percentage Interest evidenced by all Subordinate
Certificates; (d) adversely affect in any material respect the interest of the
Class R Certificateholder without the consent of the Holder of the Class R
Certificate; (e) change in any material respect the rights and obligations of
the Trustee under this Agreement without the prior written consent of such
party; or (f) reduce the aforesaid percentage of the Certificates the Holders of
which are required to consent to any such amendments without the consent of the
Holders of all Certificates then outstanding; provided, that for the purposes of
this Agreement, the Holder of the Class R Certificate shall have no right to
vote at all times that any Class A Certificates or Subordinate Certificates are
outstanding if such amendment relates to the modification, elimination or
addition of any provision necessary to maintain the qualification of the Trust
Fund as a REMIC.
65
<PAGE>
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 to the effect that such amendment will not cause
either REMIC I or REMIC II of the Trust Fund to fail to qualify as a REMIC at
any time that any REMIC I Regular Interests or Certificates are outstanding.
As soon as practicable after the execution of any such amendment, the
Trustee shall furnish written notification of the substance of such amendment to
each Certificateholder and the Rating Agency.
It shall not be necessary for the consent of the Certificateholders under
this Section 8.1 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.
Prior to the execution of any amendment to this Agreement, the Trustee
shall be entitled to receive and rely upon an Opinion of Counsel stating that
the execution of such amendment is authorized or permitted by this Agreement.
The Trustee may, but shall not be obligated to, enter into any such amendment
which affects the Trustee's own rights, duties or immunities under this
Agreement.
Section 8.2. Limitation on Rights of Certificateholders. The death or
incapacity of any Certificateholder shall not operate to terminate this
Agreement or the Trust Fund, nor entitle such Certificateholder's legal
representatives or heirs to claim an accounting or take any action or proceeding
in any court for a partition or winding up of the Trust Fund, nor otherwise
affect the rights, obligations and liabilities of the parties hereto or any of
them.
Except as otherwise expressly provided herein no Certificateholder, solely
by virtue of its status as a Certificateholder, shall have any right to vote 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
person by reason of any action taken by the parties to this Agreement pursuant
to any provision hereof.
No Certificateholder, solely by virtue of its status as Certificateholder,
shall have any right by virtue or by availing of any provision of this Agreement
to institute any suit, action or proceeding in equity or at law upon or under or
with respect to this Agreement, unless such holder previously shall have given
to the Trustee a written notice of default and of the continuance thereof, as
hereinbefore provided, and unless all of the Holders of Certificates evidencing,
in aggregate, not less than 25% of the Trust Fund shall have made written
request upon the Trustee to institute such action, suit or proceeding in its own
name as Trustee hereunder and shall have offered to the Trustee such reasonable
indemnity
66
<PAGE>
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 of any
provision of this Agreement to affect, disturb or prejudice the rights of the
Holders of any other of such Certificates, or to obtain or seek to obtain
priority over or preference to any other such Holder, or to enforce any right
under this Agreement, except in the manner herein provided and for the benefit
of all Certificateholders. For the protection and enforcement of the provisions
of this Section 8.2, each and every Certificateholder and the Trustee shall be
entitled to such relief as can be given either at law or in equity.
Section 8.3. Governing Law; Jurisdiction. THIS AGREEMENT SHALL BE
CONSTRUED IN ACCORDANCE WITH THE LAWS OF THE STATE OF NEW YORK (WITHOUT REGARD
TO CONFLICTS OF LAWS PRINCIPLES), AND THE OBLIGATIONS, RIGHTS AND REMEDIES OF
THE PARTIES HEREUNDER SHALL BE DETERMINED IN ACCORDANCE WITH SUCH LAWS.
Section 8.4. Notices. All demands, notices and communications hereunder
shall be in writing and shall be deemed to have been duly given if personally
delivered at or mailed by certified or registered mail, return receipt requested
(a) in the case of the Depositor, to ABN AMRO Mortgage Corporation, 181 West
Madison Street, Suite 3250, Chicago, Illinois 60602, Attention: Maria Fregosi -
Director - ABN AMRO Mortgage Operations, or such other address as may hereafter
be furnished to the Trustee in writing by the Depositor, (b) in the case of the
Trustee, to the Corporate Trust Office, or such other address as may hereafter
be furnished to the Depositor in writing by the Trustee, in each case Attention:
Corporate Trust Department and (c) in the case of DCR, to 17 State Street, 12th
Floor, New York, New York 10004, Attention: Asset Backed Monitoring, or such
other address as may hereinafter be furnished to the Depositor in writing by
DCR. Any notice required or permitted to be mailed to a Certificateholder shall
be given by first class mail, postage prepaid, at the address of such Holder as
shown in the Certificate Register. Any notice mailed or transmitted within the
time prescribed in this Agreement shall be conclusively presumed to have been
duly given, whether or not the addressee receives such notice; provided, that
any demand, notice or communication to or upon the Depositor or the Trustee
shall not be effective until received.
67
<PAGE>
Section 8.5. Severability of Provisions. If any one or more of the
covenants, agreements, provisions or terms of this Agreement shall be for any
reason whatsoever held invalid, then such covenants, agreements, provisions or
terms shall be deemed severable from the remaining covenants, agreements,
provisions or terms of this Agreement and shall in no way affect the validity or
enforceability of the other provisions of this Agreement or of the Certificates
or the rights of the holders thereof.
[REMAINDER OF PAGE INTENTIONALLY LEFT BLANK]
68
<PAGE>
IN WITNESS WHEREOF, the Depositor and the Trustee have caused their names
to be signed hereto by their respective officers thereunto duly authorized, all
as of the day and year first above written.
ABN AMRO MORTGAGE CORPORATION,
as Depositor
By: /s/ Stewart W. Fleming
------------------------------------
Name: Stewart W. Fleming
Its: Senior Vice President
S-1 Pooling Agreement
<PAGE>
THE FIRST NATIONAL BANK OF
CHICAGO, as Trustee
By: /s/ Mary Fonti
------------------------------------
Its: Vice President
S-2 Pooling Agreement
<PAGE>
STATE OF Michigan )
: ss.:
COUNTY OF Oakland )
On the 1st day of July, 1999, before me, Sally A. Raffler,
personally appeared Stewart W. Fleming, a Senior Vice President of ABN AMRO
Mortgage Corporation, personally known to me (or proved to me on the basis of
satisfactory evidence) to be the person whose name is subscribed to the within
instrument, and acknowledged to me that he executed the same in his authorized
capacity, and that by his signature on the instrument the person, or the entity
upon behalf of which the person acted, executed the instrument.
WITNESS my hand and official seal
Signature /s/ Sally Raffler (Seal)
------------------------
Pooling Agreement
<PAGE>
STATE OF New York )
: ss.:
COUNTY OF New York )
On the 1st day of July, 1999, before me, Mark E. Davis, personally
appeared Mary Fonti, known to me to be Vice President of The First National Bank
of Chicago, one of the corporations that executed the within instrument, and
also known to me to be the person who executed it on behalf of said corporation,
and acknowledged to me that such corporation executed the within instrument.
IN WITNESS WHEREOF, I have hereunto set my hand and affixed my
official seal the day and year in this certificate first above written.
/s/Mark E. Davis
----------------------------------------
Notary Public
[NOTARIAL SEAL]
Pooling Agreement
<PAGE>
EXHIBIT A
FORMS OF CERTIFICATES
<PAGE>
Exhibit A-1
CUSIP 00077BKC6
RESECURITIZATION PASS-THROUGH CERTIFICATE
Class A
Evidencing a Percentage Interest in certain distributions with respect to a pool
of pooled securities formed and administered by
ABN AMRO MORTGAGE CORPORATION
This Certificate represents ownership of a "regular interest" in a "real estate
mortgage investment conduit," as those terms are defined in Sections 860G and
860D, respectively, of the Internal Revenue Code of 1986, as amended. The issue
date (the "Issue Date") of this Certificate is July 30, 1999. The rate at which
interest is payable as of the Issue Date with respect to this Certificate is
variable per annum.
Unless this Certificate is presented by an authorized representative of The
Depository Trust Company, a New York corporation ("DTC"), to the Trustee or its
agent for registration of transfer, exchange, or payment, and any Certificate
issued is registered in the name of Cede & Co. or such other name as is
requested by an authorized representative of DTC (and any payment is made to
Cede & Co. or to such other entity as is requested by an authorized
representative of DTC), ANY TRANSFER, PLEDGE OR OTHER USE HEREOF FOR VALUE OR
OTHERWISE BY OR TO ANY PERSON IS WRONGFUL inasmuch as the registered owner
hereof, Cede & Co., has an interest herein.
IN THE CASE OF ANY CLASS A CERTIFICATE PRESENTED FOR REGISTRATION, THE
TRUSTEE OR CERTIFICATE REGISTRAR SHALL REQUIRE SUCH TRANSFEREE TO PROVIDE
AN OFFICER'S CERTIFICATE SIGNED BY A RESPONSIBLE OFFICER OF SUCH
TRANSFEREE STATING THAT THE TRANSFEREE IS NOT AN EMPLOYEE BENEFIT PLAN
(WITHIN THE MEANING OF SECTION 3(3) OF THE EMPLOYEE RETIREMENT INCOME
SECURITY ACT OF 1974, AS AMENDED ("ERISA")), SUBJECT TO THE PROHIBITED
TRANSACTION PROVISIONS OF ERISA ("PLAN"), OR A PLAN (WITHIN THE MEANING OF
SECTION 4975(E)(1) OF THE INTERNAL REVENUE CODE OF 1986 ("CODE")) SUBJECT
TO SECTION 4975 OF THE CODE (ALSO A "PLAN"), WHICH OFFICER'S CERTIFICATE
SHALL NOT BE AN EXPENSE OF THE TRUSTEE, THE CERTIFICATE ADMINISTRATOR, IF
ANY, OR THE DEPOSITOR; PROVIDED THAT IF THE CLASS A CERTIFICATE IS A
BOOK-ENTRY CERTIFICATE, SUCH TRANSFEREE SHALL BE DEEMED BY THE ACCEPTANCE
OR ACQUISITION OF SUCH CERTIFICATE TO HAVE MADE THE REPRESENTATIONS ABOVE.
Series 1999-RS1 Portion of the Class A Principal Balance as
of the Pooled Security Information Date
evidenced by this Certificate: $[_________]
Class A Remittance Rate: Variable
Pooled Security Information Date: June 25, 1999
First Distribution Date: August 27, 1999
A-1-1
<PAGE>
Last Scheduled Distribution Date: March 28, 2029
Class A Principal Balance as of the Pooled Security Information Date:
$[_________]
---------------
Registered Owner Certificate No.__
A-1-2
<PAGE>
[OID LEGEND
This certificate was issued on July 30, 1999 with original issued discount
("OID") of $_________________ per $1,000 of original certificate [notional]
principal balance, an initial class coupon rate of ____% per annum, an
annualized monthly compounded yield to maturity of ___%, an adjusted issue price
as a percentage of original certificate [notional] principal balance of ___% and
OID allocable to the initial short accrual period of $___________ per $1,000 of
original certificate [notional] principal balance. The prepayment assumption
used by the issuer in pricing this certificate is ___% [PSA, CPR]. The yield to
maturity was based upon fractional monthly compounding taking into account the
initial short accrual period.]
A-1-3
<PAGE>
Exhibit A-2
CUSIP 00077BKD4
RESECURITIZATION PASS-THROUGH CERTIFICATE
Class B-1
Evidencing a Percentage Interest in certain distributions with respect to a pool
of pooled securities formed and administered by
ABN AMRO MORTGAGE CORPORATION
This Certificate represents ownership of a "regular interest" in a "real estate
mortgage investment conduit," as those terms are defined in Sections 860G and
860D, respectively, of the Internal Revenue Code of 1986, as amended (the
"Code"). The issue date (the "Issue Date") of this Certificate is July 30, 1999.
The rate at which interest is payable as of the Issue Date with respect to this
Certificate is 8.00% per annum.
Unless this Certificate is presented by an authorized representative of The
Depository Trust Company, a New York corporation ("DTC"), to the Trustee or its
agent for registration of transfer, exchange, or payment, and any Certificate
issued is registered in the name of Cede & Co. or such other name as is
requested by an authorized representative of DTC (and any payment is made to
Cede & Co. or to such other entity as is requested by an authorized
representative of DTC), ANY TRANSFER, PLEDGE OR OTHER USE HEREOF FOR VALUE OR
OTHERWISE BY OR TO ANY PERSON IS WRONGFUL inasmuch as the registered owner
hereof, Cede & Co., has an interest herein.
IN THE CASE OF ANY CLASS B-1 CERTIFICATE PRESENTED FOR REGISTRATION, THE
TRUSTEE OR CERTIFICATE REGISTRAR SHALL REQUIRE SUCH TRANSFEREE TO PROVIDE
AN OFFICER'S CERTIFICATE SIGNED BY A RESPONSIBLE OFFICER OF SUCH
TRANSFEREE STATING THAT THE TRANSFEREE IS NOT AN EMPLOYEE BENEFIT PLAN
(WITHIN THE MEANING OF SECTION 3(3) OF THE EMPLOYEE RETIREMENT INCOME
SECURITY ACT OF 1974, AS AMENDED ("ERISA")), SUBJECT TO THE PROHIBITED
TRANSACTION PROVISIONS OF ERISA ("PLAN"), OR A PLAN (WITHIN THE MEANING OF
SECTION 4975(E)(1) OF THE INTERNAL REVENUE CODE OF 1986 ("CODE")) SUBJECT
TO SECTION 4975 OF THE CODE (ALSO A "PLAN"), WHICH OFFICER'S CERTIFICATE
SHALL NOT BE AN EXPENSE OF THE TRUSTEE, THE CERTIFICATE ADMINISTRATOR, IF
ANY, OR THE DEPOSITOR; PROVIDED THAT IF THE CLASS B-1 CERTIFICATE IS A
BOOK-ENTRY CERTIFICATE, SUCH TRANSFEREE SHALL BE DEEMED BY THE ACCEPTANCE
OR ACQUISITION OF SUCH CERTIFICATE TO HAVE MADE THE REPRESENTATIONS ABOVE.
The Class B-1 Certificates will be subordinate in right of payment to and
provide credit support to certain Classes of Certificates, as described in the
Pooling Agreement.
Series 1999-RS1 Portion of the Class B-1 Principal Balance as
of the Pooled Security Information Date
evidenced by this Certificate: $[_________]
Class B-1 Remittance Rate: 8.00%
Pooled Security Information Date: June 25, 1999
First Distribution Date: August 27, 1999
Last Scheduled Distribution Date: March 28, 2029
A-2-1
<PAGE>
Class B-1 Principal Balance as of the Pooled Security Information Date:
$[________]
----------------
Registered Owner Certificate No.__
A-2-2
<PAGE>
[OID LEGEND
This certificate was issued on July 30, 1999 with original issued discount
("OID") of $_________________ per $1,000 of original certificate [notional]
principal balance, an initial class coupon rate of ____% per annum, an
annualized monthly compounded yield to maturity of ___%, an adjusted issue price
as a percentage of original certificate [notional] principal balance of ___% and
OID allocable to the initial short accrual period of $___________ per $1,000 of
original certificate [notional] principal balance. The prepayment assumption
used by the issuer in pricing this certificate is ___% [PSA, CPR]. The yield to
maturity was based upon fractional monthly compounding taking into account the
initial short accrual period.]
A-2-3
<PAGE>
Exhibit A-3
CUSIP 00077BKE2
RESECURITIZATION PASS-THROUGH CERTIFICATE
Class B-2
Evidencing a Percentage Interest in certain distributions with respect to a pool
of pooled securities formed and administered by
ABN AMRO MORTGAGE CORPORATION
This Certificate represents ownership of a "regular interest" in a "real estate
mortgage investment conduit," as those terms are defined in Sections 860G and
860D, respectively, of the Internal Revenue Code of 1986, as amended (the
"Code"). The issue date (the "Issue Date") of this Certificate is July 30, 1999.
The rate at which interest is payable as of the Issue Date with respect to this
Certificate is 8.00% per annum.
Unless this Certificate is presented by an authorized representative of The
Depository Trust Company, a New York corporation ("DTC"), to the Trustee or its
agent for registration of transfer, exchange, or payment, and any Certificate
issued is registered in the name of Cede & Co. or such other name as is
requested by an authorized representative of DTC (and any payment is made to
Cede & Co. or to such other entity as is requested by an authorized
representative of DTC), ANY TRANSFER, PLEDGE OR OTHER USE HEREOF FOR VALUE OR
OTHERWISE BY OR TO ANY PERSON IS WRONGFUL inasmuch as the registered owner
hereof, Cede & Co., has an interest herein.
IN THE CASE OF ANY CLASS B-2 CERTIFICATE PRESENTED FOR REGISTRATION, THE
TRUSTEE OR CERTIFICATE REGISTRAR SHALL REQUIRE SUCH TRANSFEREE TO PROVIDE
AN OFFICER'S CERTIFICATE SIGNED BY A RESPONSIBLE OFFICER OF SUCH
TRANSFEREE STATING THAT THE TRANSFEREE IS NOT AN EMPLOYEE BENEFIT PLAN
(WITHIN THE MEANING OF SECTION 3(3) OF THE EMPLOYEE RETIREMENT INCOME
SECURITY ACT OF 1974, AS AMENDED ("ERISA")), SUBJECT TO THE PROHIBITED
TRANSACTION PROVISIONS OF ERISA ("PLAN"), OR A PLAN (WITHIN THE MEANING OF
SECTION 4975(E)(1) OF THE INTERNAL REVENUE CODE OF 1986 ("CODE")) SUBJECT
TO SECTION 4975 OF THE CODE (ALSO A "PLAN"), WHICH OFFICER'S CERTIFICATE
SHALL NOT BE AN EXPENSE OF THE TRUSTEE, THE CERTIFICATE ADMINISTRATOR, IF
ANY, OR THE DEPOSITOR; PROVIDED THAT IF THE CLASS B-2 CERTIFICATE IS A
BOOK-ENTRY CERTIFICATE, SUCH TRANSFEREE SHALL BE DEEMED BY THE ACCEPTANCE
OR ACQUISITION OF SUCH CERTIFICATE TO HAVE MADE THE REPRESENTATIONS ABOVE.
The Class B-2 Certificates will be subordinate in right of payment to and
provide credit support to certain Classes of Certificates, as described in the
Pooling Agreement.
Series 1999-RS1 Portion of the Class B-2 Principal Balance
as of the Pooled Security Information Date
evidenced by this Certificate: $[_________]
Class B-2 Remittance Rate: 8.00%
Pooled Security Information Date: June 25, 1999
First Distribution Date: August 27, 1999
A-3-1
<PAGE>
Last Scheduled Distribution Date: March 28, 2029
Class B-2 Principal Balance as of the Pooled Security Information Date:
$[__________]
----------------
Registered Owner Certificate No.__
A-3-2
<PAGE>
[OID LEGEND
This certificate was issued on July 30, 1999 with original issued discount
("OID") of $_________________ per $1,000 of original certificate [notional]
principal balance, an initial class coupon rate of ____% per annum, an
annualized monthly compounded yield to maturity of ___%, an adjusted issue price
as a percentage of original certificate [notional] principal balance of ___% and
OID allocable to the initial short accrual period of $___________ per $1,000 of
original certificate [notional] principal balance. The prepayment assumption
used by the issuer in pricing this certificate is ___% [PSA, CPR]. The yield to
maturity was based upon fractional monthly compounding taking into account the
initial short accrual period.]
A-3-3
<PAGE>
Exhibit A-4
CUSIP 00077BKF9
RESECURITIZATION PASS-THROUGH CERTIFICATE
Class B-3
Evidencing a Percentage Interest in certain distributions with respect to a pool
of Pooled Securities formed and administered by
ABN AMRO MORTGAGE CORPORATION
This Certificate represents ownership of a "regular interest" in a "real estate
mortgage investment conduit," as those terms are defined in Sections 860G and
860D, respectively, of the Internal Revenue Code of 1986, as amended (the
"Code"). The issue date (the "Issue Date") of this Certificate is July 30, 1999.
The rate at which interest is payable as of the Issue Date with respect to this
Certificate is 8.00% per annum.
Unless this Certificate is presented by an authorized representative of The
Depository Trust Company, a New York corporation ("DTC"), to the Trustee or its
agent for registration of transfer, exchange, or payment, and any Certificate
issued is registered in the name of Cede & Co. or such other name as is
requested by an authorized representative of DTC (and any payment is made to
Cede & Co. or to such other entity as is requested by an authorized
representative of DTC), ANY TRANSFER, PLEDGE OR OTHER USE HEREOF FOR VALUE OR
OTHERWISE BY OR TO ANY PERSON IS WRONGFUL inasmuch as the registered owner
hereof, Cede & Co., has an interest herein.
IN THE CASE OF ANY CLASS B-3 CERTIFICATE PRESENTED FOR REGISTRATION, THE
TRUSTEE OR CERTIFICATE REGISTRAR SHALL REQUIRE SUCH TRANSFEREE TO PROVIDE
AN OFFICER'S CERTIFICATE SIGNED BY A RESPONSIBLE OFFICER OF SUCH
TRANSFEREE STATING THAT THE TRANSFEREE IS NOT AN EMPLOYEE BENEFIT PLAN
(WITHIN THE MEANING OF SECTION 3(3) OF THE EMPLOYEE RETIREMENT INCOME
SECURITY ACT OF 1974, AS AMENDED ("ERISA")), SUBJECT TO THE PROHIBITED
TRANSACTION PROVISIONS OF ERISA ("PLAN"), OR A PLAN (WITHIN THE MEANING OF
SECTION 4975(E)(1) OF THE INTERNAL REVENUE CODE OF 1986 ("CODE")) SUBJECT
TO SECTION 4975 OF THE CODE (ALSO A "PLAN"), WHICH OFFICER'S CERTIFICATE
SHALL NOT BE AN EXPENSE OF THE TRUSTEE, THE CERTIFICATE ADMINISTRATOR, IF
ANY, OR THE DEPOSITOR; PROVIDED THAT IF THE CLASS B-3 CERTIFICATE IS A
BOOK-ENTRY CERTIFICATE, SUCH TRANSFEREE SHALL BE DEEMED BY THE ACCEPTANCE
OR ACQUISITION OF SUCH CERTIFICATE TO HAVE MADE THE REPRESENTATIONS ABOVE.
The Class B-3 Certificates will be subordinate in right of payment to and
provide credit support to certain Classes of Certificates, as described in the
Pooling Agreement.
Series 1999-RS1 Portion of the Class B-3 Principal Balance
as of the Pooled Security Information Date
evidenced by this Certificate: $[_______]
Class B-3 Remittance Rate: 8.00%
A-4-1
<PAGE>
Pooled Security Information Date: June 25, 1999
First Distribution Date: August 27, 1999
Last Scheduled Distribution Date: March 28, 2029
Class B-3 Principal Balance as of the
Pooled Security Information Date: $[_________]
----------------
Registered Owner Certificate No. __
A-4-2
<PAGE>
[OID LEGEND
This certificate was issued on July 30, 1999 with original issued discount
("OID") of $_________________ per $1,000 of original certificate [notional]
principal balance, an initial class coupon rate of ____% per annum, an
annualized monthly compounded yield to maturity of ___%, an adjusted issue price
as a percentage of original certificate [notional] principal balance of ___% and
OID allocable to the initial short accrual period of $___________ per $1,000 of
original certificate [notional] principal balance. The prepayment assumption
used by the issuer in pricing this certificate is ___% [PSA, CPR]. The yield to
maturity was based upon fractional monthly compounding taking into account the
initial short accrual period.]
A-4-3
<PAGE>
EXHIBIT B
FORM OF RESIDUAL CERTIFICATE
CUSIP 00077BKG7
Evidencing a Percentage Interest in certain distributions with respect to a pool
of pooled securities formed and administered by
ABN AMRO MORTGAGE CORPORATION
ANY RESALE, TRANSFER OR OTHER DISPOSITION OF THIS CERTIFICATE MAY BE MADE ONLY
IF THE PROPOSED TRANSFEREE PROVIDES A TRANSFER AFFIDAVIT TO THE DEPOSITOR AND
THE CERTIFICATE REGISTRAR THAT (1) SUCH TRANSFEREE IS NOT EITHER (A) THE UNITED
STATES, ANY STATE OR POLITICAL SUBDIVISION THEREOF, ANY FOREIGN GOVERNMENT, ANY
INTERNATIONAL ORGANIZATION, OR ANY AGENCY OR INSTRUMENTALITY OF ANY OF THE
FOREGOING, (B) ANY ORGANIZATION (OTHER THAN A COOPERATIVE DESCRIBED IN SECTION
521 OF THE CODE) WHICH IS EXEMPT FROM THE TAX IMPOSED BY CHAPTER 1 OF THE CODE
UNLESS SUCH ORGANIZATION IS SUBJECT TO THE TAX IMPOSED BY SECTION 511 OF THE
CODE, (C) ANY ORGANIZATION DESCRIBED IN SECTION 1381(a)(2)(C) OF THE CODE (ANY
SUCH PERSON DESCRIBED IN THE FOREGOING CLAUSES (A), (B), OR (C) BEING
HEREINAFTER REFERRED TO AS A "DISQUALIFIED ORGANIZATION"), OR (D) AN AGENT OF A
DISQUALIFIED ORGANIZATION AND (2) NO PURPOSE OF SUCH TRANSFER IS TO ENABLE THE
TRANSFER TO IMPEDE THE ASSESSMENT OR COLLECTION OF TAX. SUCH AFFIDAVIT SHALL
INCLUDE CERTAIN REPRESENTATIONS AS TO THE FINANCIAL CONDITION OF THE PROPOSED
TRANSFEREE. NOTWITHSTANDING THE REGISTRATION IN THE CERTIFICATE REGISTER OF ANY
TRANSFER, SALE OR OTHER DISPOSITION OF THIS CLASS R CERTIFICATE TO A
DISQUALIFIED ORGANIZATION OR AN AGENT OF A DISQUALIFIED ORGANIZATION, SUCH
REGISTRATION SHALL BE DEEMED TO BE OF NO LEGAL FORCE OR EFFECT WHATSOEVER AND
SUCH PERSON SHALL NOT BE DEEMED TO BE A CERTIFICATEHOLDER FOR ANY PURPOSE
HEREUNDER, INCLUDING, BUT NOT LIMITED TO, THE RECEIPT OF DISTRIBUTIONS ON THIS
CERTIFICATE. EACH HOLDER OF A CLASS R CERTIFICATE BY ACCEPTANCE OF THIS
CERTIFICATE SHALL BE DEEMED TO HAVE CONSENTED TO THE PROVISIONS OF THIS
PARAGRAPH.
IN THE CASE OF ANY CLASS R CERTIFICATE PRESENTED FOR REGISTRATION, THE
TRUSTEE OR CERTIFICATE REGISTRAR SHALL REQUIRE SUCH TRANSFEREE TO PROVIDE
AN OFFICER'S CERTIFICATE SIGNED BY A RESPONSIBLE OFFICER OF SUCH
TRANSFEREE STATING THAT THE TRANSFEREE IS NOT AN EMPLOYEE BENEFIT PLAN
(WITHIN THE MEANING OF SECTION 3(3) OF THE EMPLOYEE RETIREMENT INCOME
SECURITY ACT OF 1974, AS AMENDED ("ERISA")), SUBJECT TO THE PROHIBITED
TRANSACTION PROVISIONS OF ERISA ("PLAN"), OR A PLAN (WITHIN THE MEANING OF
SECTION 4975(E)(1) OF THE INTERNAL REVENUE CODE OF 1986 ("CODE")) SUBJECT
TO SECTION 4975 OF THE CODE (ALSO A "PLAN"), WHICH OFFICER'S CERTIFICATE
SHALL NOT BE AN EXPENSE OF THE TRUSTEE, THE CERTIFICATE ADMINISTRATOR, IF
ANY, OR THE DEPOSITOR; PROVIDED THAT IF THE CLASS R CERTIFICATE IS A
BOOK-ENTRY CERTIFICATE, SUCH TRANSFEREE SHALL BE DEEMED BY THE ACCEPTANCE
OR ACQUISITION OF SUCH CERTIFICATE TO HAVE MADE THE REPRESENTATIONS ABOVE.
Solely for U.S. federal income tax purposes, this Certificate represents
"residual interests" in "real estate mortgage investment conduits," as those
terms are defined in Sections 860G and 860D, respectively, of the Internal
Revenue Code of 1986, as amended.
Series 1999-RS1 Percentage Interest evidenced by this
Class R Certificate in the distributions
to be made with respect to the Class R
Certificate: ____%
Class R Remittance Rate: 8.00%.
Additionally, the Class R Certificates
are entitled to the Residual Distribution
Amount as defined in the Pooling Agreement.
Pooled Security Information Date:
June 25, 1999
First Distribution Date: August 27, 1999
Last Scheduled Distribution Date:
March 28, 2029
Class R Principal Balance as of the
Pooled Security Information Date: $100.00
Registered Owner Certificate No.__
B-1
<PAGE>
EXHIBIT C
POOLED SECURITY SCHEDULE
C-1
<PAGE>
<TABLE>
<CAPTION>
Pooled Security Full Name of Series
<S> <C>
1. Bear Stearns Mortgage Securities Inc.,
Mortgage Pass-Through Certificates,
Series 1996-5, Class B-3
2. Bear Stearns Mortgage Securities Inc.
Mortgage Pass-Through Certificates,
Series 1998-1, Class B-3
3. DLJ Mortgage Acceptance Corp.,
Mortgage Pass-Through Certificates,
Series 1994-3, Class B-2
4. DLJ Mortgage Acceptance Corp.,
Mortgage Pass-Through Certificates,
Series 1998-2, Class C-B-3
5. Fannie Mae REMIC Trust,
REMIC Pass-Through Certificates,
Series 1998-W7, Class B-2
6. Headlands Mortgage Securities Inc.,
Mortgage Pass-Through Certificates,
Series 1998-3, Class B-3
7. PNC Mortgage Securities Corp.,
Mortgage Pass-Through Certificates,
Series 1998-14, Class D-B-3
8. PNC Mortgage Securities Corp.,
Mortgage Pass-Through Certificates,
Series 1998-2, Class C-B-3
9. PNC Mortgage Securities Corp.,
Mortgage Pass-Through Certificates,
Series 1998-7, Class II-B-3
10. PNC Mortgage Securities Corp.,
Mortgage Pass-Through Certificates,
Series 1999-1, Class I-B-3
11. PNC Mortgage Securities Corp.,
Mortgage Pass-Through Certificates,
Series 1998-6, Class C-B-3
</TABLE>
C-2
<PAGE>
<TABLE>
<S> <C>
12. Residential Accredit Loans, Inc.,
Mortgage Asset-Backed Pass-Through Certificates,
Series 1997-QS4, Class M-3
13. CWMBS, Inc.,
Residential Asset Securitization Trust 1997-A1,
Mortgage Pass-Through Certificates,
Series 1997-A, Class B-3
14. CWMBS, Inc.,
Residential Asset Securitization Trust 1998-A6,
Mortgage Pass-Through Certificates,
Series 1998-F, Class B-3
15. CWMBS, Inc.,
Residential Asset Securitization Trust 1998-A15,
Mortgage Pass-Through Certificates,
Series 1998-O, Class B-3
16. CWMBS, Inc.,
Residential Asset Securitization Trust 1999-A1,
Mortgage Pass-Through Certificates
Series 1999-A, Class B-3
17. Structured Asset Mortgage Investments Inc.,
Mortgage Pass-Through Certificates,
Series 1998-10, Class B-3
18. Structured Asset Mortgage Investments Inc.,
Mortgage Pass-Through Certificates,
Series 1998-12, Class B-3
19. Structured Asset Mortgage Investments Inc.,
Mortgage Pass-Through Certificates,
Series 1998-11, Class B-3
20. Structured Asset Mortgage Investments Inc.,
Mortgage Pass-Through Certificates,
Series 1998-8, Class 4-B-3
</TABLE>
C-3
<PAGE>
EXHIBIT D
FORM OF TRANSFEROR CERTIFICATE
[Date]
The First National Bank of Chicago
One First National Plaza, Suite IL1-0126
Chicago, IL 60670-0126
Re: ABN AMRO Mortgage Corporation Resecuritization Pass-Through
Certificates, Series 1999-RS1 Class R
This letter is delivered to you in connection with the sale by
_________________ (the "Seller") to ___________________ (the "Purchaser") of
$____________ initial Certificate Principal Balance of Mortgage Resecuritization
Certificates, Series 1999-RS1, Class R (the "Certificate"), pursuant to Section
4.1 of the Pooling Agreement (the "Pooling Agreement"), dated as of July 1, 1999
between ABN AMRO Mortgage Corporation, as depositor (the "Company"), and The
First National Bank of Chicago, as trustee (the "Trustee"). All terms used
herein and not otherwise defined shall have the meanings set forth in the
Pooling Agreement. The Seller hereby certifies, represents and warrants to, and
covenants with the Depositor and the Trustee that:
1. No purpose of the Seller relating to the sale of the Certificate by the
Seller to the Purchaser is or will be to enable the Seller to impede the
assessment or collection of tax.
2. The Seller understands that the Purchaser has delivered to the Trustee
and the Depositor a Transferee Affidavit and Agreement in the form attached to
the Pooling Agreement as Exhibit E. The Seller does not know or believe that any
representation contained therein is false.
3. The Seller has no actual knowledge that the proposed Transferee is not
a Permitted Transferee.
4. The Seller has no actual knowledge that the Purchaser would be
unwilling or unable to pay taxes due on its share of the taxable income
attributable to the Certificates.
5. The Seller has conducted a reasonable investigation of the financial
condition of the Purchaser and, as a result of the investigation, found that the
Purchaser has historically paid its debts as they came due, and found no
significant evidence to indicate that the Purchaser will not continue to pay its
debts as they come due in the future.
6. The Purchaser has represented to the Seller that, if the Certificates
constitute a noneconomic residual interest, it (i) understands that as holder of
a noneconomic residual interest it may incur tax liabilities in
D-1
<PAGE>
excess of any cash flows generated by the interest, and (ii) intends to pay
taxes associated with its holding of the Certificates as they become due.
Very truly yours,
[Seller]
By:
------------------------------------
Name:
------------------------------
Title:
-----------------------------
D-2
<PAGE>
EXHIBIT E
FORM OF TRANSFEREE AFFIDAVIT AND AGREEMENT
STATE OF )
) ss:
COUNTY OF )
[NAME OF OFFICER], being first duly sworn, deposes and says:
1. That he is [Title of Officer] of [Name of Owner] (record or beneficial
owner of the Class R Certificate (the "Owner")), a [savings institution]
[corporation] duly organized and existing under the laws of [the State of
________] [the United States], on behalf of which he makes this affidavit and
agreement.
2. That the Owner (i) is not and will not be a "disqualified organization"
as of the [date of transfer] within the meaning of Section 860E(e) (5) of the
Internal Revenue Code of 1986, as amended (the "Code") and will endeavor to
remain other than a disqualified organization for so long as it retains its
ownership interest in the Class R Certificate, and (ii) is acquiring the Class R
Certificate for its own account or for the account of another Owner from which
it has received an affidavit and agreement in substantially the same form as
this affidavit and agreement. (For this purpose, a "disqualified organization"
means the United States, any state or political subdivision thereof, or any
agency or instrumentality of any of the foregoing (other than an instrumentality
all of the activities of which are subject to tax and, except for the Federal
Home Loan Mortgage Corporation, a majority of whose board of directors is not
selected by any such governmental entity, or any foreign government or
international organization, or any agency or instrumentality of such foreign
government or organization, any rural electric or telephone cooperative, or any
organization (other than certain farmers' cooperatives) that is generally exempt
from federal income tax unless such organization is subject to the tax on
unrelated business taxable income).
3. That the Owner is aware (i) of the tax that would be imposed on
transfers of the Class R Certificate; (ii) that such tax would be on the
transferor, or, if such transfer is through an agent (which person includes a
broker, nominee or middleman) for a disqualified organization, on the agent;
(iii) that the person otherwise liable for the tax shall be relieved of
liability for the tax if the transferee furnished to such person an affidavit
that the transferee is not a disqualified organization and, at the time of
transfer, such person does not have actual knowledge that the affidavit is
false; and (iv) that the Class R Certificate may represent "noneconomic residual
interests" within the meaning of 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,
if a significant purpose of the transfer was to enable the transferor to impede
the assessment or collection of tax.
4. That the Owner is aware of the tax imposed on a "pass-through entity"
holding the Class R Certificate if at any time during the taxable year of the
pass-through entity a disqualified organization is the
E-1
<PAGE>
record holder of an interest in such entity. (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.)
5. That the Owner is aware that the Trustee and the Certificate Registrar
will not register the transfer of the Class R Certificate unless the transferee,
or other transferee's agent, delivers to each of them an affidavit and
agreement, among other things, in substantially the same form as this affidavit
and agreement. The Owner expressly agrees that it will not consummate any such
transfer if it knows or believes that any of the representations contained in
such affidavit and agreement are false.
6. That the Owner has reviewed the restrictions set forth on the face of
the Class R Certificate and the provisions of Section 4.1 of the Pooling
Agreement under which the Class R Certificate was issued. The Owner expressly
agrees to be bound by and to comply with such restrictions and provisions.
7. That the Owner consents to any additional restrictions or arrangements
that shall be deemed necessary upon advice of counsel to constitute a reasonable
arrangement to ensure that the Class R Certificate will only be owned, directly
or indirectly, by an Owner that is not a disqualified organization.
8. The Owner's Taxpayer Identification Number is _______________________.
9. That no purpose of the Owner relating to the purchase of the Class R
Certificate by the Owner is or will be to enable the transferor to impede the
assessment or collection of tax.
10. That the Owner has no present knowledge or expectation that it will be
unable to pay any United States taxes owed by it so long as any of the
Certificates remain outstanding.
11. That the Owner has no present knowledge or expectation that it will
become insolvent or subject to a bankruptcy proceeding for so long as any of the
Certificates remain outstanding.
12. That the purpose of the Owner relating to the sale of the Class R
Certificate by the Owner will be to impede the assessment or collection of tax.
13. The Owner is a citizen or resident of the United States, a
corporation, partnership or other entity created or organized in, or under the
laws of, the United States or any political subdivision thereof, or an estate or
trust whose income from sources without the United States is includible in gross
income for United States federal income tax purposes regardless of its
connection with the conduct of a trade or business within the United States.
14. The Owner hereby agrees to cooperate with the Depositor and to take
any action required of it by the Code or Treasury regulations thereunder
(whether now or hereafter promulgated) in order to create or maintain the REMIC
status of the REMIC I or the REMIC II.
E-2
<PAGE>
15. The Owner hereby agrees that it will not take any action that could
endanger the REMIC status of the REMIC I or the REMIC II, as applicable, or
result in the imposition of tax on the REMIC I or the REMIC II unless counsel
for, or acceptable to, the Depositor has provided an opinion that such action
will not result in the loss of such REMIC status or the imposition of such tax,
as applicable.
16. The Owner as transferee of the Class R Certificate has represented to
their transferor that, if the Class R Certificate represents noneconomic
residual interests, the Owner (i) understands that as holder of a noneconomic
residual interest it may incur tax liabilities in excess of any cash flows
generated by the interest, and (ii) intends to pay taxes associated with its
holding of the Class R Certificate as they become due.
IN WITNESS WHEREOF, the Owner has caused this instrument to be executed on
its behalf, pursuant to the authority of its Board of Directors, by its [Title
of Officer] and its corporate seal to be hereunto attached, attested by its
[Assistant] Secretary, this __________ day of ___________, 19__.
[Name of Owner]
By:
------------------------------------
[Name of Officer]
[Title of Officer]
[Corporate Seal]
ATTEST:
[Assistant] Secretary
E-3
<PAGE>
Personally appeared before me the above-named [Name of Officer], known or
proved to me to be the same person who executed the foregoing instrument and to
be the [Title of Officer] of the Owner, and Acknowledged to me that he executed
the same as his free act and deed and free act and deed of the Owner.
Subscribed and sworn before me this ____ day of ____________, 19__.
NOTARY PUBLIC
COUNTY OF
STATE OF
My Commission expires the ___ day
of ____________, 19__
E-4
<PAGE>
EXHIBIT F
FORM OF ADDITIONAL MATTER INCORPORATED
INTO THE FORM OF THE CERTIFICATES
This Certificate does not represent an obligation of or interest in ABN
AMRO Mortgage Corporation, the Trustee or any of their affiliates. Neither this
Certificate nor the underlying Pooled Securities are guaranteed by any agency or
instrumentality of the United States.
This certifies that the above-named Registered Owner is the registered
owner of certain interests in a trust fund (the "Certificate Trust Fund") formed
by ABN AMRO Mortgage Corporation (the "Depositor") whose assets consist of,
among other things, a pool (the "Pooled Securities Pool") of mortgage
pass-through certificates (the "Pooled Securities") representing interests in
conventional mortgage loans secured by first liens on one- to four-family
residential real properties or by shares in cooperative corporations. The Pooled
Securities were acquired by the Depositor from third parties. The Pooled
Securities Pool was created pursuant to a Pooling Agreement, dated as of July 1,
1999 above (the "Pooling Agreement"), between the Depositor and The First
National Bank of Chicago, as Trustee (the "Trustee"), a summary of certain of
the pertinent provisions of which is set forth hereafter. To the extent not
defined herein, the capitalized terms used herein have the meanings assigned in
the Pooling Agreement. Nothing herein shall be deemed inconsistent with such
meanings, and in the event of any conflict between the Pooling Agreement and the
terms of this Certificate, the Pooling Agreement shall control. This Certificate
is issued under and is subject to the terms, provisions and conditions of the
Pooling Agreement, to which Pooling Agreement the Holder of this Certificate, by
virtue of the acceptance hereof, assents and by which such Holder is bound.
Distributions will be made, pursuant to the Pooling Agreement, on the 2nd
Business Day following the 25th day of each month or, if such day is not a
Business Day, the Business Day immediately following (the "Distribution Date"),
commencing on the first Distribution Date specified above, to the Person in
whose name this Certificate is registered at the close of business on the last
Business Day of the month immediately preceding the month of such distribution
(the "Record Date"), to the extent of such Certificateholder's Percentage
Interest represented by this Certificate in the portion of the Certificate
Distribution Amount for such Distribution Date then distributable on the
Certificates of this Class, as specified in Section 3.5 of the Pooling
Agreement.
Distributions on this Certificate will be made by the Trustee or its
Paying Agent by wire transfer or by other means of payment acceptable to each
Certificateholder of record on the immediately preceding Record Date.
Notwithstanding the above, the final distribution on this Certificate will be
made after due notice by the Trustee or its Paying Agent of the pendency of such
distribution and only upon presentation and surrender of this Certificate to the
Certificate Registrar.
Reference is hereby made to the further provisions of this Certificate set
forth below, which further provisions shall for all purposes have the same
effect as if set forth at this place.
F-1
<PAGE>
Unless the certificate of authentication hereon has been executed by or on
behalf of the Trustee, by manual signature, this Certificate shall not be
entitled to any benefit under the Pooling Agreement or be valid for any purpose.
IN WITNESS WHEREOF, the Trustee has caused this Certificate to be duly
executed.
THE FIRST NATIONAL BANK OF CHICAGO, not
individually but solely as Trustee
---------------------------------------
By:
TRUSTEE'S CERTIFICATE OF AUTHENTICATION
This is one of the Certificates referred to in the within-mentioned
Pooling Agreement.
THE FIRST NATIONAL BANK OF CHICAGO,
as Trustee
By:
--------------------------------
Dated:
-----------------------------
F-2
<PAGE>
ABN AMRO MORTGAGE CORPORATION
RESECURITIZATION PASS-THROUGH CERTIFICATE
This Certificate is one of a duly authorized issue of Certificates
designated as Resecuritization Pass-Through Certificates of the Series and Class
specified hereon (herein called the "Certificates") and representing certain
interests in the Certificate Trust Fund.
The Certificates do not represent an obligation of, or an interest in, the
Depositor, the Trustee or any of their affiliates and are not insured or
guaranteed by any governmental agency. The Certificates are limited in right of
payment to certain collections respecting the Pooled Securities, all as more
specifically set forth herein and in the Pooling Agreement.
The Pooling Agreement permits, with certain exceptions therein provided,
the amendment thereof and the modification of the rights and obligations of the
Depositor, and the rights of the Certificateholders under the Pooling Agreement
at any time by the Depositor and the Trustee, with the consent of the Holders of
the Certificates aggregating not less than 66-2/3% of the aggregate Percentage
Interest evidenced by all of the Certificates of the Trust Fund. For the
purposes of such provision and except as provided below, voting rights related
to 100% of the Aggregate Certificate Principal Balance of any Class will be
allocated pro rata (by Certificate Principal Balance) among the Certificates of
such Class. Any such consent by the Holder of this Certificate shall be
conclusive and binding on such Holder and upon all future Holders of this
Certificate and of any Certificate issued upon the transfer hereof or in
exchange hereof or in lieu hereof whether or not notation of such consent is
made upon this Certificate. The Pooling Agreement also permits the amendment
thereof, in certain limited circumstances, without the consent of the Holders of
any of the Certificates.
As provided in the Pooling Agreement and subject to certain limitations
therein set forth, the transfer of this Certificate is registrable in the
Certificate Register upon surrender of this Certificate for registration of
transfer at the offices of the Certificate Registrar or the office maintained by
the Trustee in the City and State of New York, duly endorsed by, or accompanied
by an assignment in the form below or other written instrument of transfer in
form satisfactory to the Trustee or any Authenticating Agent duly executed by,
the Holder hereof or such Holder's attorney duly authorized in writing, and
thereupon one or more new Certificates of Authorized Denominations evidencing
the same Percentage Interest set forth hereinabove will be issued to the
designated transferee or transferees.
No transfer of a Certificate will be made unless such transfer is made in
accordance with the registration requirements of the Securities Act of 1933, as
amended and any applicable state securities laws.
The Certificates are issuable only as registered Certificates without
coupons in Authorized Denominations specified in the Pooling Agreement. As
provided in the Pooling Agreement and subject to certain limitations therein set
forth, Certificates are exchangeable for new Certificates of Authorized
Denominations evidencing the same aggregate interest in the portion of the
Available Distribution Amount distributable on this Class of Certificate, as
requested by the Holder surrendering the same.
F-3
<PAGE>
A reasonable service charge may be made for any such registration of
transfer or exchange, and the Trustee or the Certificate Registrar may require
payment of a sum sufficient to cover any tax or other governmental charge
payable in connection therewith.
The Depositor, the Certificate Registrar, the Certificate Administrator,
the Trustee and any agent of any of them may treat the Person in whose name this
Certificate is registered as the owner hereof for all purposes, and neither the
Depositor, the Certificate Registrar, the Certificate Administrator, the Trustee
nor any such agent shall be affected by notice to the contrary.
The respective obligations and responsibilities of the Trustee created
under the Pooling Agreement (other than the obligation to make payments to
Certificateholders as set forth therein) shall terminate upon the earlier of (i)
the later of the final payment or other liquidation of the last Pooled Security
remaining in the Trust Fund or (ii) the purchase by the Depositor of all Pooled
Securities at a price established pursuant to the Pooling Agreement; provided,
however, that in no event shall the trust created hereby continue beyond 21
years from the death of the survivor of certain persons identified in the
Pooling Agreement.
F-4
<PAGE>
ASSIGNMENT
FOR VALUE RECEIVED the undersigned hereby sell(s) and assign(s) and
transfer(s) unto _______________________________________________________________
________________________________________________________________________________
________________________________________________________________
(Please print or typewrite name and address, including postal zip code of
assignee. Please insert social security or other identifying number of
assignee.)
the within Resecuritization Pass-Through Certificate and hereby irrevocably
constitutes and appoints _______________________________________________________
Attorney to transfer said Certificate on the Certificate Register, with full
power of substitution in the premises.
Dated: _____________________________ ________________________________________
Signature Guaranteed
________________________________________
NOTICE:
The signature to this assignment must
correspond with the name as written upon
the face of the within instrument in
every particular, without alteration or
enlargement or any change whatever.
F-5
<PAGE>
EXHIBIT G
DATA PROVIDER DATA
Property Type
Owner Occupied
Loan Purpose
Loan Type
Current Interest Rate
Original Balance
Current Balance
First Payment Date
Maturity Date
Current PNI
Servicing Fee
Loan Term
Foreclosure/REO
Loan to Value Ratio
State Code
Interest Paid to Date
Zip Code
PIF Data
Amortized Remaining Term
G-1
<PAGE>
Execution Copy
Exhibit 4.2
POOLED SECURITIES
PURCHASE AGREEMENT
Dated as of July 1, 1999
DONALDSON, LUFKIN & JENRETTE
SECURITIES CORPORATION
Seller
and
ABN AMRO MORTGAGE CORPORATION
Purchaser
<PAGE>
Execution Copy
Table of Contents
<TABLE>
<CAPTION>
Section Page
- ------- ----
<S> <C> <C>
Statement of the Transaction 1
ARTICLE I
DEFINITIONS
SECTION 1.01. 2
ARTICLE II
CONVEYANCE OF THE UNDERLYING CERTIFICATES
SECTION 2.01. Delivery of Underlying Certificates 4
SECTION 2.02. Closing 4
SECTION 2.03. Survival of Representations and Warranties 4
ARTICLE III
REPRESENTATIONS AND WARRANTIES; REPURCHASE OBLIGATIONS
SECTION 3.01. Representations and Warranties of the Seller 5
SECTION 3.02. Substitution of Underlying Certificates 6
SECTION 3.03. Indemnification By the Seller 7
ARTICLE IV
ACKNOWLEDGEMENTS
SECTION 4.01. Acknowledgement of the Purchaser 8
SECTION 4.02. Acknowledgement of the Seller 8
ARTICLE V
MISCELLANEOUS
SECTION 5.01. Notices 9
SECTION 5.02. Separability Clause 9
SECTION 5.03. Counterparts 9
SECTION 5.04. Place of Delivery and Governing Law 9
SECTION 5.05. Remedies Cumulative; No Waiver 9
SECTION 5.06. Miscellaneous 10
</TABLE>
<PAGE>
<TABLE>
<S> <C> <C>
SECTION 5.07. Agreement of the Seller 10
SECTION 5.08. Successors and Assigns 10
SECTION 5.09. Underwriting Agreement 11
Schedule A Underlying Certificates Schedule 13
Schedule B Form of Mortgage Loan Data Tape 15
</TABLE>
(3)
<PAGE>
Statement of the Transaction
Subject to the terms and conditions hereof, Donaldson, Lufkin
& Jenrette Securities Corporation (the "Seller") hereby agrees to irrevocably
sell and transfer to ABN AMRO Mortgage Corporation (the "Purchaser"), and the
Purchaser hereby agrees to purchase and accept from the Seller, the Underlying
Certificates identified in the Underlying Certificates Schedule attached hereto
as Schedule A, having an aggregate Principal Balance on the Closing Date of
$47,753,042.
Simultaneously with the sale of the Underlying Certificates to
the Purchaser on the Closing Date, the Underlying Certificates will be sold to a
trust in exchange for the ABN AMRO Mortgage Corporation, Resecuritization
Pass-Through Certificates, Series 1999-RS1 (the "Certificates").
The following sets forth the terms and conditions of the
contemplated transaction, to which the parties have agreed, as evidenced by the
execution of this Agreement.
4
<PAGE>
ARTICLE I
DEFINITIONS
SECTION 1.1. Whenever used in the Agreement, the following
words and phrases, unless the context otherwise requires, shall have the
following meanings (capitalized terms not otherwise defined herein are used
herein with the meanings assigned thereto in the Pooling Agreement):
Agreement: This Pooled Securities Purchase Agreement including
all schedules, amendments and supplements hereto.
Certificate Rate: As to any Underlying Certificate, the per
annum rate of interest at which interest accrues on the principal balance of
such Underlying Certificate.
Certificates: As defined in the Statement of Transaction
hereto.
Closing Date: July 30, 1999.
Cut-off Date: June 25, 1999.
Defective Underlying Certificate: Any Underlying Certificate
subject to repurchase or substitution by the Seller pursuant to Section 3.01 or
Section 3.02.
Eligible Underlying Certificate. An Underlying Certificate
substituted by the Seller for a Defective Underlying Certificate which must, on
the date of such substitution, (i) have an outstanding principal balance, not in
excess of and not more than 5% less than the principal balance of the Defective
Underlying Certificate, (ii) have a Certificate Rate not less than the
Certificate Rate of the Defective Underlying Certificate, (iii) have a last
scheduled distribution date not more than six months earlier and not later than
the last scheduled distribution date of the Defective Underlying Certificate,
(iv) comply with each representation and warranty set forth in Section 3.01
(deemed to be made as of the Substitution Date), and (v) have the same or
comparable rating of at least one nationally recognized statistical rating
organization. More than one Eligible Underlying Certificate may be substituted
for a Defective Underlying Certificate if each such Eligible Underlying
Certificate meets the attributes set forth in (ii), (iii), (iv) and (v) above,
and the attribute set forth in (i) above in the aggregate.
Pooling Agreement: The Pooling Agreement, dated as of July 1,
1999, among the Purchaser, as depositor and the Trustee, as trustee.
Person: Any individual, corporation, partnership, joint
venture, association, joint-stock company, trust, unincorporated organization or
government or any agency or political subdivision thereof.
Purchase Price: As to any Underlying Certificate and as of any
date of repurchase, the principal balance thereon plus accrued and unpaid
interest thereon up to but not including such date.
5
<PAGE>
Substitution Adjustment: As to any date on which a
substitution occurs pursuant to Section 3.02, the excess of (i) the principal
balance of the Defective Underlying Certificate (after application of principal
payments received on or before the date of substitution of any Eligible
Underlying Certificate), together with all accrued and unpaid interest over (ii)
the principal balance of such Eligible Underlying Certificate as of the date of
substitution.
Trust: As defined in Section 5.08.
Trustee: The First National Bank of Chicago, as trustee for
the holders of ABN AMRO Mortgage Corporation, Resecuritization Pass-Through
Certificates, Series 1999-RS1.
Underlying Certificates Purchase Price: $43,651,055.69.
Underlying Certificates: The securities identified in the
Underlying Certificates Schedule attached hereto as Schedule A.
Underwriting Agreement: The Underwriting Agreement, dated July
27, 1999, among the Purchaser, Seller, ABN AMRO North America, Inc. and ABN AMRO
Incorporated.
6
<PAGE>
ARTICLE II
CONVEYANCE OF THE UNDERLYING CERTIFICATES
SECTION 2.1. Delivery of Underlying Certificates.
Conveyance of Underlying Certificates. The Seller concurrently
with the execution and delivery of this Agreement, does hereby sell, transfer,
assign, set over and otherwise convey to the Purchaser without recourse all the
right, title and interest of the Seller in and to the Underlying Certificates,
including all interest and principal received on or with respect to the
Underlying Certificates after the Pooled Security Distribution Date (as defined
in the Pooling Agreement) for July 1999 and all proceeds of the foregoing.
In connection with such transfer and assignment, the Purchaser
hereby directs the Seller to cause the Underlying Certificates to be registered
in the name of the Trustee and to be delivered to the Trustee. The transfer of
the Underlying Certificates accomplished hereby is absolute and is intended as a
sale. If such transfer is deemed to constitute a pledge of security for a loan,
it is the intent of this Agreement that the Seller shall be deemed to have
granted to the Purchaser a first priority perfected security interest in all of
the Seller's right, title and interest to and under the Underlying Certificates
and all proceeds thereof, and that this Agreement shall constitute a security
agreement under applicable law.
SECTION 2.2. Closing.
On the Closing Date the Purchaser shall pay to the Seller the
Underlying Certificates Purchase Price by wire transfer of immediately available
funds or such other method of payment as the parties hereto may agree.
SECTION 2.3. Survival of Representations and Warranties.
It is understood and agreed that the representations and
warranties set forth in Article III are continuing representations and
warranties and shall survive the sale of the Underlying Certificates to the
Purchaser and by the Purchaser to the Trustee and shall inure to the benefit of
the Purchaser and the Trustee.
7
<PAGE>
ARTICLE III
REPRESENTATIONS AND WARRANTIES; REPURCHASE OBLIGATIONS
SECTION 3.1. Representations and Warranties of the Seller.
(a) The Seller hereby represents and warrants to the Purchaser
as of the Closing Date:
(i) The information referred to in Schedule A was true and correct in
all material respects as of the Cut-off Date;
(ii) immediately prior to the sale of the Underlying Certificates to
the Purchaser, the Seller was the sole owner and holder of the
Underlying Certificates, free and clear of any and all liens, pledges,
participations, charges, mortgages, encumbrances or security interests
of any nature whatsoever, 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; and
(iii) the Seller has the requisite power and authority to sell the
Underlying Certificates and all corporate and other action required to
be taken for the sale of the Underlying Certificates hereunder has been
taken.
Upon discovery by the Seller, the Purchaser or the Trustee of
a breach of any of the representations and warranties set forth in this Section
3.01(a) that materially and adversely affects the value of the Underlying
Certificates or the interests of the Purchaser in the related Underlying
Certificate, the party discovering such breach shall give prompt written notice
to the other party. Pursuant to such notice, the Seller shall be directed to
cure such breach. Within 60 days of its discovery or its receipt of notice of
breach, if the Seller has not cured such breach in all material respects, the
Seller shall either substitute an Eligible Underlying Certificate for the
defective Underlying Certificate as provided in Section 3.02 or shall purchase
the defective Underlying Certificate from the Purchaser on the first day of the
month in the month following the month in which such 60-day period expired at
the Purchase Price of such Underlying Certificate. The Purchase Price for the
purchased Underlying Certificate shall be deposited by the Seller in an account
at the direction of the Purchaser on or prior to such date. Upon receipt of
either the Eligible Underlying Certificate or the Purchase Price by the
Purchaser, the Purchaser shall release the defective Underlying Certificate to
the Seller, and the Purchaser shall execute and deliver such instruments of
transfer or assignment, in each case without recourse, as shall be necessary to
vest in the Seller or its designee any Underlying Certificate released pursuant
hereto. Except as provided in Section 3.03, it is understood and agreed that the
obligation of the Seller to cure, substitute or purchase any Underlying
Certificate as to which such a breach has occurred and is continuing shall
constitute the sole remedy against the Seller respecting such breach available
to the Purchaser.
(b) The Seller hereby represents and warrants to Purchaser, as
of the Closing Date:
(i) The Seller is duly organized as a Delaware corporation
and is validly
8
<PAGE>
existing and in good standing under the laws of the State of Delaware.
The Seller has all requisite power and authority to enter into this
Agreement and to carry out the transactions contemplated hereby;
(ii) The execution and delivery by the Seller of this
Agreement and the consummation of the transactions contemplated hereby
have each been duly and validly authorized by all necessary action, and
this Agreement and such other agreements constitute valid and legally
binding agreements of the Seller, enforceable against the Seller in
accordance with their respective terms, except that (i) the
enforceability thereof may be limited by bankruptcy, insolvency,
moratorium, receivership and other similar laws relating to creditors'
rights generally and (ii) the remedy of specific performance and
injunctive and other forms of equitable relief may be subject to
equitable defenses and to the discretion of the court before which any
proceeding therefor may be brought;
(iii) The execution and delivery of this Agreement and the
consummation of the transactions contemplated hereby will not violate,
conflict with, result in a breach of, constitute a default under or be
prohibited by, or require any additional approval, waiver or consent
under the Seller's charter or by-laws or any instrument or agreement to
which it is a party or by which it is bound or any federal or state
law, rule or regulation or any judicial or administrative decree,
order, ruling or regulation applicable to it; and
(iv) There is no litigation or action at law or in equity
pending, or, to its knowledge, threatened against the Seller and no
proceeding or investigation of any kind is pending or, to its
knowledge, threatened, by any federal, state or local governmental or
administrative body, which could reasonably be expected to materially
and adversely affect the Seller's ability to consummate the
transactions contemplated hereby.
SECTION 3.2. Substitution of Underlying Certificates.
(a) On any date within two years following the Closing Date
and which is on or before the date on which the Seller would otherwise be
required to repurchase an Underlying Certificate pursuant to Section 3.01, the
Seller may deliver to the Trustee one or more Eligible Underlying Certificates
in substitution for a Defective Underlying Certificate which the Seller would
otherwise be required to repurchase pursuant to Section 3.01. In connection with
any such substitution, the Seller shall calculate the Substitution Adjustment,
if any, and shall deposit such amount in an account at the direction of the
Purchaser on the date of such substitution (the "Substitution Date").
(b) The Seller shall notify the Purchaser and the Trustee in
writing not less than five business days on or before the date on which the
Seller would otherwise be required to repurchase any Defective Underlying
Certificate pursuant to Section 3.01 of its intention to effect a substitution
under this Section. On the Substitution Date, the Seller shall cause the
Eligible Underlying Certificates to be registered in the name of the Trustee and
to be delivered to the Trustee and shall confirm that the representations and
warranties contained in Section 3.01 are true and correct in all material
respects with respect to the Eligible Underlying Certificates as of
9
<PAGE>
such Substitution Date, provided that remedies for any breach of such
representations and warranties are limited as set forth in Section 3.01 and this
Section.
(c) Concurrently with the satisfaction of the conditions set
forth in Sections 3.02(a) and (b) above and the transfer of such Eligible
Underlying Certificates to the Trustee pursuant to this Section, Schedule A to
this Agreement shall be deemed to be amended to exclude the Defective Underlying
Certificate and to include the information with respect to such Eligible
Underlying Certificates, and all references in this Agreement to the Underlying
Certificates shall include such Eligible Underlying Certificates and be deemed
to be made on or after the related Substitution Date, as the case may be, as to
such Eligible Underlying Certificates.
(d) In connection with the transfer of any Eligible Underlying
Certificates to the Trustee pursuant to this Section 3.02, the Seller shall
deliver to the Purchaser and the Trustee an opinion of counsel to the effect
that such substitution will not cause (x) any federal tax to be imposed on the
Trust, including, without limitation, any Federal tax imposed on the "prohibited
transactions" under Section 860G(d)(1) of the Code or (y) the Trust to fail to
qualify as a REMIC at any time that any Certificate is outstanding. In the event
that such opinion indicates that a substitution will result in the imposition of
a prohibited transaction tax, give rise to net taxable income or be deemed a
contribution to the REMIC, the Seller shall not substitute for any such
Underlying Certificates until the opinion of counsel to the effect referred to
in the preceding sentence may be rendered.
SECTION 3.3. Indemnification By the Seller.
The Seller shall indemnify and hold harmless the Purchaser
from and against any actual loss, liability or expense incurred by the Purchaser
arising from the breach by the Seller of a representation and warranty made by
the Seller pursuant to either Section 3.01(a)(ii) or (iii) of this Agreement,
provided that the Seller shall have no obligation to indemnify the Purchaser for
any such loss, liability or expense incurred by the Purchaser as a result of the
Purchaser's bad faith or negligence. The Seller will have no obligation to
indemnify the Purchaser for a breach of the representation and warranty being
made by the Seller pursuant to Section 3.01(a)(i) of the Agreement, the remedies
for any such breach being limited to Section 3.01 hereto.
10
<PAGE>
ARTICLE IV
ACKNOWLEDGEMENTS
SECTION 4.1. Acknowledgement of the Purchaser.
The Purchaser hereby acknowledges its purchase of the
Underlying Certificates in consideration for the payment of the Underlying
Certificates Purchase Price.
SECTION 4.2. Acknowledgement of the Seller.
The Seller hereby acknowledges (a) the receipt of the
Underlying Certificates Purchase Price in consideration for the sale to the
Purchaser of the Underlying Certificates and (b) that it has caused the
Underlying Certificates to be registered in the name of the Trustee and that it
has delivered the Underlying Certificates to the Trustee. The Seller shall
provide the Purchaser on the Closing Date with evidence satisfactory to it
showing that the Underlying Certificates have been registered in the name of the
Trustee as of such date.
11
<PAGE>
ARTICLE V
MISCELLANEOUS
SECTION 5.1. Notices.
All demands, notices and communications hereunder shall be in
writing and shall be deemed to have been duly given if mailed by registered or
certified mail, return receipt requested, or, if by other means, when received
by the other party or at the address, in the case of the Seller: Donaldson,
Lufkin & Jenrette Securities Corporation, 277 Park Avenue, New York, New York
10172, Attention: Shannon Smith; and in the case of the Purchaser: ABN AMRO
Mortgage Corporation, 181 West Madison Street, Chicago, Illinois 60602,
Attention: Maria N. Fregosi - Director - ABN AMRO Mortgage Operations, or such
other address as may hereafter be furnished to the other party by like notice.
Any such demand, notice or communication hereunder shall be deemed to have been
given on the date delivered to the premises of the addressee (as evidenced, in
the case of registered or certified mail, by the date noted on the return
receipt).
SECTION 5.2. Separability Clause.
Any provision, representation or warranty of this Agreement
that is prohibited or unenforceable in any jurisdiction shall, as to such
jurisdiction, be ineffective to the extent of such prohibition or
unenforceability without invalidating the remaining provisions hereof, and any
such prohibition or unenforceability in any jurisdiction shall not invalidate or
render unenforceable such provision in any other jurisdiction. To the extent
permitted by applicable law, the parties hereto waive any provision of law that
prohibits or renders unenforceable any provision hereof.
SECTION 5.3. Counterparts.
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 5.4. Place of Delivery and Governing Law.
The Agreement shall be construed in accordance with the laws
of the State of New York and the obligations, rights and remedies of the parties
hereunder shall be determined in accordance with such laws.
SECTION 5.5. Remedies Cumulative; No Waiver.
All rights and remedies of the Purchaser or any assignee of
the Purchaser under the Agreement shall, to the extent permitted by law, be
deemed cumulative and not exclusive of any thereof or of any other rights and
remedies available to the Purchaser or such assignee; and no failure to exercise
any right or power accruing upon the occurrence and continuation as
12
<PAGE>
aforesaid of any default shall impair any such right or power, or shall be
construed to be a waiver of any such default or an acquiescence therein; and
every right and remedy arising under this Agreement or by law to the Purchaser
or such assignee may be exercised from time to time, and as often as shall be
deemed expedient, by the Purchaser or such assignee.
SECTION 5.6. Miscellaneous.
This Agreement may be amended or supplemented from time to
time only with the written consent of the Seller and the Purchaser or any
assignee of the Purchaser. This Agreement contains the entire understanding and
agreement of the parties and supersedes and incorporates all prior negotiations,
understandings and agreements, which are fully merged herein.
SECTION 5.7. Agreement of the Seller.
(a) The Seller agrees to execute and deliver such instruments
and take such actions, including, without limitation all necessary UCC-1
financing statements and any continuation statements with respect thereto, as
the Purchaser or any assignee of the Purchaser may, from time to time,
reasonably request in order to effectuate the purpose and to carry out the terms
of this Agreement.
(b) On the Closing Date the Seller shall provide the Purchaser
with an opinion of counsel to the effect that this Agreement has been duly
authorized, executed and delivered by the Seller and is an enforceable
obligation of the Seller subject to bankruptcy, insolvency, reorganization,
moratorium or other similar laws affecting creditors' rights generally and to
general principals of equity.
(c) On the Closing Date the Seller shall provide the Purchaser
with a data tape containing the information with respect to the underlying
mortgage loans substantially in the form of Schedule B attached hereto.
(d) On the Closing Date the Seller shall provide the Purchaser
with copies of the: (i) prospectus and prospectus supplement pursuant to which
each of the Underlying Certificates were publicly offered; and (ii) most recent
monthly trustee report for each of the Underlying Certificates which are
required to be delivered to the holders of the Underlying Certificates pursuant
to the terms of the underlying agreements.
SECTION 5.8. Successors and Assigns.
This Agreement shall bind and inure to the benefit of and be
enforceable by the Seller, the Purchaser, and the respective successors and
assigns of the Seller, the Purchaser and any designee of the Purchaser. The
parties hereto acknowledge that the Purchaser is acquiring the Underlying
Certificates for the purpose of contributing them to a trust (the "Trust") that
will issue Certificates representing undivided interests in the Underlying
Certificates. As an inducement to the Purchaser to purchase the Underlying
Certificates, the Seller acknowledges
13
<PAGE>
and consents to the assignment to the Trustee by the Purchaser of all of the
Purchaser's rights against the Seller hereunder in respect of the Underlying
Certificates and that the enforcement or exercise of any right or remedy against
the Seller hereunder by the Trustee shall have the same force and effect as if
enforced or exercised by the Purchaser directly.
SECTION 5.9. Underwriting Agreement.
The parties hereto agree that the Seller shall have no
obligation to sell the Underlying Certificates to the Purchaser, and the
Purchaser shall have no obligation to purchase the Underlying Certificates from
the Seller, if the sale of the Certificates pursuant to the Underwriting
Agreement is not consummated on the Closing Date.
14
<PAGE>
IN WITNESS WHEREOF, the Seller and the Purchaser have caused
their names to be signed hereto by their respective officers thereunto duly
authorized and their respective seals, duly attested, to be hereunto affixed.
Dated as of July 1, 1999
DONALDSON, LUFKIN & JENRETTE
SECURITIES CORPORATION.
as Seller
By: /s/ Shannon Smith
-------------------------------
Name: Shannon Smith
Title: Senior Vice President
ABN AMRO MORTGAGE CORPORATION
as Purchaser
By: /s/ Maria Fregosi
-------------------------------
Name: Maria Fregosi
Title: First Vice President
15
<PAGE>
SCHEDULE A
UNDERLYING CERTIFICATES SCHEDULE
<TABLE>
<CAPTION>
ISSUER NAME SERIES CLASS TRUSTEE ORIGINAL CUT-OFF PASS-THROUGH CURRENT
- ----------- ------ ----- ------- PRINCIPAL DATE RATE RATING
BALANCE PRINCIPAL ---- ------
------- BALANCE
--------
<S> <C> <C> <C> <C> <C> <C> <C>
BSMSI 1996-5 B-3 BNY $2,370,244 $2,280,345 8.125 BBB
BSMSI 1998-1 B-3 CHASE $3,572,600 $2,001,182 6.750 BBB
DLJ 1994-3 B-2 CHASE $4,033,964 $3,750,508 6.500 BBB
DLJ 1998-2 C-B-3 BNY $2,295,948 $2,264,554 6.835 BBB
FNW 1998-W7 B-2 FNMA $2,248,574 $2,232,606 7.085 BBB
HMSI 1998-3 B-3 BNY $1,366,900 $1,359,756 6.650 BBB
PNC 1998-14 D-B-3 STATE $4,260,274 $4,238,803 6.764 BBB
PNC 1998-2 C-B-3 USBNK $2,098,478 $2,071,867 7.000 BBB
PNC 1998-7 II-B-3 STATE $3,364,662 $3,341,287 7.000 BBB
PNC 1999-1 I-B-3 STATE $3,756,138 $3,740,291 6.250 BBB
PNC 1998-6 C-B-3 USBNK $2,743,972 $2,716,902 6.671 BBB
RALI 1997-QS4 M-3 FCHIC $3,316,900 $2,282,901 7.750 BBB
RAST 1997-A1 B-3 BNY $1,731,000 $1,691,226 7.735 BBB
</TABLE>
16
<PAGE>
<TABLE>
<CAPTION>
ISSUER NAME SERIES CLASS TRUSTEE ORIGINAL CUT-OFF PASS-THROUGH CURRENT
- ----------- ------ ----- ------- PRINCIPAL DATE RATE RATING
BALANCE PRINCIPAL ---- ------
------- BALANCE
--------
<S> <C> <C> <C> <C> <C> <C> <C>
RAST 1998-A6 B-3 BNY $3,375,684 $3,344,555 6.750 BBB
RAST 1998-A15 B-3 BNY $2,073,300 $2,062,588 6.850 BBB
RAST 1999-A1 B-3 BNY $1,995,888 $1,989,198 6.716 BBB
SAMI 1998-10 B-3 BKTRU $2,285,600 $2,272,695 6.900 BBB
SAMI 1998-12 B-3 NORWB $1,114,000 $1,108,252 6.750 BBB
SAMI 1998-11 B-3 FCHIC $1,485,500 $1,476,993 6.750 BBB
SAMI 1998-8 4-B-3 FCHIC $1,540,000 $1,526,535 6.750 BBB
</TABLE>
17
<PAGE>
SCHEDULE B
FORM OF MORTGAGE LOAN DATA TAPE
<TABLE>
<CAPTION>
LOAN ORIGINAL CURRENT LOAN REMAINING ORIGINAL BALLOON TOTAL LTV STATE ZIP DELINQUENCY MONTHLY
GROUP PRINCIPAL FACTOR AGE TERM TO TERM TO FLAG SERVICING --- ----- CODE STATUS PYMT
- ----- BALANCE ------ --- MATURITY MATURITY ---- FEES ---- ------ AMT
------- -------- -------- ---- ---
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C>
</TABLE>
18
