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: September 16, 1999
(Date of earliest event reported)
Commission File No. 333-71489
EQCC Receivables Corporation
EQCC Asset Backed Corporation
- --------------------------------------------------------------------------------
59-3170055
Delaware 59-3170052
- --------------------------------------------------------------------------------
(State of Incorporation) (I.R.S. Employer Identification No.)
10401 Deerwood Park Boulevard
Jacksonville, Florida 32256
- --------------------------------------------------------------------------------
Address of principal executive offices (Zip Code)
(904) 987-5000
- --------------------------------------------------------------------------------
Registrant's Telephone Number, including area code
- --------------------------------------------------------------------------------
(Former name, former address and former fiscal year,
if changed since last report)
<PAGE>
ITEM 5. OTHER EVENTS
On August 26, 1999, EQCC Receivables Corporation and EQCC Asset
Backed Corporation (collectively, the "Registrant"), sold EQCC Home Equity Loan
Asset Backed Certificates, Series 1999-3, Class A-1F, Class A-2F, Class A-3F,
Class A-4F, Class A-5F, Class A-6F, Class A-7F and Class A-1A (the "Offered
Certificates"), having an aggregate original principal balance of
$1,000,000,000.00. The Offered Certificates were issued pursuant to a Pooling
and Servicing Agreement, dated as of August 26, 1999, among the Registrant,
EquiCredit Corporation of America, as representative and servicer (the
"Servicer"), and U.S. Bank National Association, as trustee (the "Agreement"), a
copy of which is filed as an exhibit hereto. EQCC Home Equity Loan Asset Backed
Certificates, Series 1999-3, Class X, Class R-I, Class R-II, Class R-III, and
Class R-IV Certificates (the "Private Certificates" and, together with the
Offered Certificates, the "Certificates"), were also issued pursuant to the
Agreement.
The Servicer obtained from Ambac Assurance Corporation (the
"Insurer) a certificate guaranty insurance policy in favor of the Trustee for
the benefit of the Certificateholders of the Offered Certificates (the
"Securities Insurance Policy").
As of the date of initial issuance, the Offered Certificates
evidenced an interest in a trust fund (the "Trust Fund"), consisting primarily
of (i) two groups of fixed-rate and one group of adjustable-rate mortgage loans,
secured by mortgages, deeds of trust or other instruments creating a first or
second lien on one- to four-family dwellings, (ii) all monies received on the
Mortgage Loans on and after the Cut-Off Date (other than the Representative's
Yield, as described in the Agreement), (iii) the Securities Insurance Policy and
(iv) certain other property. The remaining undivided interests in the Trust Fund
are evidenced by the Private Certificates.
Interest on the Offered Certificates will be distributed on each
Payment Date (as defined in the Agreement). Monthly distributions in reduction
of the principal balance of the Offered Certificates will be allocated to the
Offered Certificates in accordance with the priorities set forth in the
Agreement.
An election will be made to treat certain assets in the Trust Fund
as four separate real estate mortgage investment conduits for federal income tax
purposes (each, a "REMIC"). The Offered Certificates and Class X Certificates
will represent beneficial ownership interests in the "regular interests" in
REMIC IV and the Class R-I, Class R-II, Class R-III, and Class R-IV Certificates
will each be treated as a "residual interest" in the related REMIC.
<PAGE>
ITEM 7. FINANCIAL STATEMENTS AND EXHIBITS
Item 601(a)
of Regulation S-K
Exhibit No. Description
- ----------- -----------
(EX-4) Pooling and Servicing Agreement, dated as of
August 26, 1999, among EQCC Receivables
Corporation and EQCC Asset Backed Corporation,
EquiCredit Corporation of America and U.S.
Bank National Association, as trustee
(EX-99.1) Certificate Guaranty Insurance Policy issued
byAmbac Assurance Corporation
<PAGE>
Pursuant to the requirements of the Securities Exchange Act of 1934,
the registrants have duly caused this report to be signed on their behalf by the
undersigned hereunto duly authorized.
EQCC RECEIVABLES CORPORATION
September 16, 1999
By: /s/ Lenore Hanapel
------------------------------
Name: Lenore Hanapel
Title: Senior Vice President
EQCC ASSET BACKED CORPORATION
September 16, 1999
By: /s/ Lenore Hanapel
------------------------------
Name: Lenore Hanapel
Title: Senior Vice President
<PAGE>
INDEX TO EXHIBITS
-----------------
Paper (P) or
Exhibit No. Description Electronic (E)
- ----------- ----------- --------------
(EX-4) Pooling and Servicing Agreement, E
dated as of August 26, 1999,
among EQCC Receivables Corporation
and EQCC Asset Backed Corporation,
EquiCredit Corporation of America and
U.S. Bank National Association, as trustee
(EX-99.1) Certificate Guaranty Insurance Policy issued by E
Ambac Assurance Corporation
==============================================================================
POOLING AND SERVICING AGREEMENT
Dated as of August 1, 1999
EQCC RECEIVABLES CORPORATION
EQCC ASSET BACKED CORPORATION
(Depositors)
and
EQUICREDIT CORPORATION OF AMERICA
(Representative and Servicer)
and
U.S. BANK NATIONAL ASSOCIATION
(Trustee)
EQCC HOME EQUITY LOAN ASSET BACKED CERTIFICATES,
Series 1999-3
==============================================================================
<PAGE>
TABLE OF CONTENTS
PAGE
ARTICLE I
DEFINITIONS
ACCOUNT....................................................................
ACCRUAL PERIOD.............................................................
ACT........................................................................
Adjustable Rate Class X Components.........................................
ADJUSTABLE RATE GROUP......................................................
ADJUSTABLE RATE GROUP......................................................
ADJUSTABLE RATE GROUP......................................................
Adjustable Rate Group Excess Spread........................................
ADJUSTABLE RATE GROUP WEIGHTED AVERAGE MORTGAGE INTEREST RATE..............
Adjusted INSURER FEE Rate..................................................
ADMINISTRATIVE FEE RATE....................................................
ADVANCE....................................................................
AFFILIATE..................................................................
AGREEMENT..................................................................
ASSIGNMENT OF BENEFICIAL INTEREST..........................................
ASSIGNMENT OF MORTGAGE.....................................................
AUTHORIZED DENOMINATIONS...................................................
AVAILABLE FUNDS............................................................
BANKRUPTCY LOAN............................................................
BASE OVERCOLLATERALIZATION TARGET AMOUNT...................................
BASIC DOCUMENTS............................................................
BASIC PRINCIPAL DISTRIBUTION AMOUNT........................................
BOOK-ENTRY CERTIFICATES....................................................
BUSINESS DAY...............................................................
CERTIFICATE................................................................
CERTIFICATE BALANCE........................................................
CERTIFICATE CUSTODIAN......................................................
CERTIFICATE DEPOSITORY AGREEMENT...........................................
CERTIFICATE GROUP..........................................................
CERTIFICATE INSURANCE POLICY...............................................
CERTIFICATE INSURER........................................................
CERTIFICATE OWNER..........................................................
Certificate Register.......................................................
Certificateholder or Holder................................................
CLASS......................................................................
CLASS A CERTIFICATEHOLDER..................................................
CLASS A CERTIFICATES.......................................................
Class A Interest Remittance Amount.........................................
CLASS A-1A BASIC PRINCIPAL DISTRIBUTION AMOUNT.............................
CLASS A-1A CERTIFICATE.....................................................
CLASS A-1A CERTIFICATEHOLDER...............................................
CLASS A-1A INTEREST REMITTANCE AMOUNT......................................
CLASS A-1A LIBOR INTEREST CARRYOVER........................................
CLASS A-1A LIBOR RATE......................................................
CLASS A-1A NET FUNDS CAP RATE..............................................
CLASS A-1A PASS-THROUGH RATE...............................................
CLASS A-1A PRINCIPAL BALANCE...............................................
CLASS A-1F CERTIFICATE.....................................................
CLASS A-1F PASS-THROUGH RATE...............................................
Class A-1F Principal Balance...............................................
CLASS A-2F CERTIFICATE.....................................................
CLASS A-2F PASS-THROUGH RATE...............................................
CLASS A-2F PRINCIPAL BALANCE...............................................
CLASS A-3F CERTIFICATE.....................................................
CLASS A-3F PASS-THROUGH RATE...............................................
CLASS A-3F PRINCIPAL BALANCE...............................................
CLASS A-4F CERTIFICATE.....................................................
CLASS A-4F PASS-THROUGH RATE...............................................
CLASS A-4F PRINCIPAL BALANCE...............................................
CLASS A-5F CERTIFICATE.....................................................
CLASS A-5F PASS-THROUGH RATE...............................................
CLASS A-5F PRINCIPAL BALANCE...............................................
CLASS A-6F CERTIFICATE.....................................................
CLASS A-6F PASS-THROUGH RATE...............................................
CLASS A-6F PRINCIPAL BALANCE...............................................
CLASS A-7F CERTIFICATE.....................................................
CLASS A-7F PASS-THROUGH RATE...............................................
CLASS A-7F PRINCIPAL BALANCE...............................................
CLASS LT1 INTEREST.........................................................
Class LT2 Interest.........................................................
CLASS LT3 INTEREST.........................................................
CLASS LT4 INTEREST.........................................................
Class LT5 Interest.........................................................
CLASS LT6 INTEREST.........................................................
CLASS LT7 INTEREST.........................................................
Class LT8 Interest.........................................................
CLASS LT9 INTEREST.........................................................
CLASS MT1 INTEREST.........................................................
CLASS MT2 INTEREST.........................................................
CLASS MT3 INTEREST.........................................................
CLASS MT4 INTEREST.........................................................
CLASS MT5 INTEREST.........................................................
CLASS MT6 INTEREST.........................................................
CLASS MT7 INTEREST.........................................................
CLASS MT8 INTEREST.........................................................
CLASS MT9 INTEREST.........................................................
Class MTN1 Interest........................................................
Class MTN2 Interest........................................................
Class MTN3 Interest........................................................
Class MTN4 Interest........................................................
Class MTN5 Interest........................................................
Class MTN6 Interest........................................................
Class MTN7 Interest........................................................
Class MTN8 Interest........................................................
Class MTN9 Interest........................................................
CLASS NTA1 INTEREST........................................................
CLASS NTA2 INTEREST........................................................
CLASS NTA3 INTEREST........................................................
CLASS NTA4 INTEREST........................................................
CLASS NTA5 INTEREST........................................................
CLASS NTA6 INTEREST........................................................
CLASS NTA7 INTEREST........................................................
CLASS NTA-1A INTEREST......................................................
CLASS NTN1 INTEREST........................................................
CLASS NTN2 INTEREST........................................................
CLASS NTN3 INTEREST........................................................
CLASS RI CERTIFICATE.......................................................
CLASS RI CERTIFICATEHOLDER.................................................
CLASS RII CERTIFICATE......................................................
CLASS RII CERTIFICATEHOLDER................................................
CLASS RIII CERTIFICATE.....................................................
CLASS RIII CERTIFICATEHOLDER...............................................
CLASS RIV CERTIFICATE......................................................
Class RIV Certificateholder................................................
CLASS X CERTIFICATE........................................................
CLASS X CERTIFICATEHOLDER..................................................
CLASS X-A COMPONENT........................................................
CLASS X-A COMPONENT REMITTANCE AMOUNT......................................
CLASS X-1F COMPONENT.......................................................
CLASS X-1F COMPONENT REMITTANCE AMOUNT.....................................
CLASS X-2F COMPONENT.......................................................
CLASS X-2F COMPONENT REMITTANCE AMOUNT.....................................
CLASS X-3 COMPONENT........................................................
CLASS X-3F COMPONENT REMITTANCE AMOUNT.....................................
CLASS X-4F COMPONENT.......................................................
CLASS X-4F COMPONENT REMITTANCE AMOUNT.....................................
CLASS X-5F COMPONENT.......................................................
CLASS X-5F COMPONENT REMITTANCE AMOUNT.....................................
CLASS X-6F COMPONENT.......................................................
CLASS X-6F COMPONENT REMITTANCE AMOUNT.....................................
CLASS X-7F COMPONENT.......................................................
CLASS X-7F COMPONENT REMITTANCE AMOUNT.....................................
CLASS X-E COMPONENT........................................................
CLASS X-E COMPONENT REMITTANCE AMOUNT......................................
CLASS X-F COMPONENT REMITTANCE AMOUNT......................................
CLASS X INTEREST...........................................................
CLASS X REMITTANCE AMOUNT..................................................
CLOSING DATE...............................................................
CODE.......................................................................
COLLECTION ACCOUNT.........................................................
COLLECTIONS................................................................
COMBINED LOAN-TO-VALUE RATIO or CLTV.......................................
COMMISSION.................................................................
CORPORATE TRUST OFFICE.....................................................
CUMULATIVE LOSSES..........................................................
CUMULATIVE LOSS PERCENTAGE.................................................
CURRENT CLTV...............................................................
CURTAILMENT................................................................
CUSTODIAL AGREEMENT........................................................
CUSTODIAN..................................................................
CUT-OFF DATE...............................................................
DEFAULT....................................................................
DEFINITIVE CERTIFICATES....................................................
DELETED MORTGAGE LOAN......................................................
DEPOSITOR..................................................................
DEPOSITORY.................................................................
DEPOSITORY PARTICIPANT.....................................................
DESTROYED MORTGAGE NOTE....................................................
DESTROYED MORTGAGE NOTE AFFIDAVIT..........................................
DETERMINATION DATE.........................................................
DISQUALIFIED NON-UNITED STATES PERSON......................................
DISQUALIFIED ORGANIZATION..................................................
DISTRIBUTION DATE..........................................................
DUE DATE...................................................................
DUE PERIOD.................................................................
ELIGIBLE ACCOUNT...........................................................
EQUICREDIT.................................................................
EVENT OF NONPAYMENT........................................................
EXCESS PROCEEDS............................................................
Excess Spread..............................................................
EXCHANGE ACT...............................................................
EXTRA PRINCIPAL DISTRIBUTION AMOUNT........................................
FDIC.......................................................................
FHLMC......................................................................
Fidelity Bond..............................................................
FINAL SCHEDULED DISTRIBUTION DATE..........................................
FIRST LIEN.................................................................
FIXED RATE CERTIFICATEHOLDER...............................................
FIXED RATE CERTIFICATES....................................................
Fixed Rate Class X Components..............................................
FIXED RATE GROUP 1.........................................................
FIXED RATE GROUP 1 AGGREGATE INTEREST REMITTANCE AMOUNT....................
FIXED RATE GROUP 1 AVAILABLE FUNDS.........................................
FIXED RATE GROUP 1 BASIC PRINCIPAL DISTRIBUTION AMOUNT.....................
FIXED RATE GROUP 1 CERTIFICATES............................................
Fixed Rate Group 1 Component Remittance Amounts............................
Fixed Rate Group 1 Excess Spread...........................................
FIXED RATE GROUP 1 INTEREST CARRYOVER......................................
FIXED RATE GROUP 1 INTEREST REMITTANCE AMOUNT..............................
FIXED RATE GROUP 1 NET FUNDS CAP RATE......................................
FIXED RATE GROUP 1 PASS-THROUGH RATE.......................................
FIXED RATE GROUP 1 PRINCIPAL BALANCE.......................................
FIXED RATE GROUP 1 WEIGHTED AVERAGE MORTGAGE INTEREST RATE.................
FIXED RATE GROUP 2.........................................................
FIXED RATE GROUP 2 AVAILABLE FUNDS.........................................
FIXED RATE GROUP 2 BASIC PRINCIPAL DISTRIBUTION AMOUNT.....................
FIXED RATE GROUP 2 CERTIFICATES............................................
FIXED RATE GROUP 2 CERTIFICATES............................................
Fixed Rate Group 2 Excess Spread...........................................
FIXED RATE GROUP 2 INTEREST CARRYOVER......................................
FIXED RATE GROUP 2 INTEREST REMITTANCE AMOUNT..............................
FIXED RATE GROUP 2 NET FUNDS CAP RATE......................................
FIXED RATE GROUP 2 WEIGHTED AVERAGE MORTGAGE INTEREST RATE.................
FIXED RATE INTEREST CARRYOVER..............................................
FNMA.......................................................................
GENERAL EXCESS AVAILABLE AMOUNT............................................
GROUP 1 OC AMOUNT..........................................................
GROUP 2 OC AMOUNT..........................................................
GROUP A-1A OC AMOUNT.......................................................
HOLDER.....................................................................
Illinois Land Trust........................................................
INDEPENDENT................................................................
INITIAL PREMIUM FEE RECOVERY AMOUNT........................................
INSURANCE ACCOUNT..........................................................
INSURANCE PROCEEDS.........................................................
INSURED PAYMENT............................................................
INTEREST CARRYOVER.........................................................
LATEST MATURITY DATE.......................................................
LIBOR......................................................................
LIBOR BUSINESS DAY.........................................................
LIBOR DETERMINATION DATE...................................................
LIEN.......................................................................
LIQUIDATED MORTGAGE LOAN...................................................
LIQUIDATION PROCEEDS.......................................................
LOCKOUT PERCENTAGE.........................................................
LOCKOUT PRO RATA REMITTANCE AMOUNT.........................................
LOCKOUT REMITTANCE AMOUNT..................................................
MAJORITY IN AGGREGATE VOTING INTEREST......................................
MONTHLY EXCESS SPREAD AMOUNT...............................................
MONTHLY PAYMENT............................................................
MONTHLY PREMIUM............................................................
MOODY'S....................................................................
MORTGAGE...................................................................
Mortgage File..............................................................
MORTGAGE IMPAIRMENT INSURANCE POLICY.......................................
MORTGAGE INTEREST RATE.....................................................
MORTGAGE LOAN..............................................................
MORTGAGE LOAN GROUP........................................................
MORTGAGE LOAN LOSSES.......................................................
MORTGAGE LOAN SCHEDULE.....................................................
MORTGAGE NOTE..............................................................
MORTGAGE POOL..............................................................
MORTGAGED PROPERTY.........................................................
MORTGAGED PROPERTY STATE...................................................
MORTGAGOR..................................................................
NET ADJUSTABLE RATE GROUP WEIGHTED AVERAGE MORTGAGE INTEREST RATE..........
NET FIXED RATE GROUP 1 WEIGHTED AVERAGE MORTGAGE INTEREST RATE.............
NET FIXED RATE GROUP 2 WEIGHTED AVERAGE MORTGAGE INTEREST RATE.............
NET LIQUIDATION PROCEEDS...................................................
NONDISQUALIFICATION OPINION................................................
NONRECOVERABLE ADVANCES....................................................
NON-UNITED STATES PERSON...................................................
OFFICER'S CERTIFICATE......................................................
OPINION OF COUNSEL.........................................................
OPTIONAL PURCHASE DATE.....................................................
ORIGINAL CLASS A-1A PRINCIPAL BALANCE......................................
ORIGINAL CLASS A-1F PRINCIPAL BALANCE......................................
ORIGINAL CLASS A-2F PRINCIPAL BALANCE......................................
ORIGINAL CLASS A-3F PRINCIPAL BALANCE......................................
ORIGINAL CLASS A-4F PRINCIPAL BALANCE......................................
ORIGINAL CLASS A-5F PRINCIPAL BALANCE......................................
ORIGINAL CLASS A-6F PRINCIPAL BALANCE......................................
ORIGINAL CLASS A-7F PRINCIPAL BALANCE......................................
Original Pool Principal Balance............................................
ORIGINATOR.................................................................
OVERCOLLATERALIZATION DEFICIENCY AMOUNT....................................
OVERCOLLATERALIZATION RELEASE AMOUNT.......................................
OVERCOLLATERALIZATION STEPDOWN DATE........................................
OVERCOLLATERALIZATION TARGET AMOUNT........................................
OVERCOLLATERALIZED AMOUNT..................................................
OWNER-OCCUPIED MORTGAGED PROPERTY..........................................
OWNERSHIP INTEREST.........................................................
PASS-THROUGH RATE..........................................................
PERCENTAGE INTEREST........................................................
PERFORMANCE DEFAULT........................................................
PERMITTED INSTRUMENTS......................................................
PERMITTED TRANSFEREE.......................................................
PERSON.....................................................................
PLAN.......................................................................
POOL FACTOR................................................................
POOL PRINCIPAL BALANCE.....................................................
PREFERENCE AMOUNT..........................................................
PRE-PLAN INTEREST..........................................................
PRE-PLAN INTEREST PAYMENTS.................................................
PRINCIPAL AND INTEREST ACCOUNT.............................................
PRINCIPAL BALANCE..........................................................
Principal Distribution Amount..............................................
PRINCIPAL PREPAYMENT.......................................................
PRINCIPAL REMITTANCE AMOUNT................................................
PROCEEDING.................................................................
PROJECTED EXCESS SPREAD....................................................
PROSPECTUS.................................................................
QUALIFIED SUBSTITUTE MORTGAGE LOAN.........................................
Rating Agencies............................................................
REASSIGNMENT OF ASSIGNMENT OF BENEFICIAL INTEREST..........................
RECORD DATE................................................................
RECORDATION TRIGGER........................................................
REFERENCE BANKS............................................................
REGISTERED HOLDER..........................................................
REGULAR INTERESTS..........................................................
REIMBURSABLE AMOUNTS.......................................................
RELEASED MORTGAGED PROPERTY PROCEEDS.......................................
REMIC......................................................................
REMIC I....................................................................
REMIC I Distribution Account...............................................
REMIC I Regular Interests..................................................
REMIC II...................................................................
REMIC II Group Interest Rate...............................................
REMIC II Group 2 Interest Rate.............................................
REMIC II Group 3 Interest Rate.............................................
REMIC II Regular Interests.................................................
REMIC III..................................................................
REMIC III Regular Interests................................................
REMIC IV...................................................................
REMIC IV Distribution Account..............................................
REMIC IV Regular Interests.................................................
REMIC PROVISIONS...........................................................
REMITTANCE REPORT..........................................................
REO DISPOSITION............................................................
REO PROPERTY...............................................................
REPRESENTATIVE.............................................................
REPRESENTATIVE'S YIELD.....................................................
RESIDENTIAL DWELLING.......................................................
RESIDUAL CERTIFICATE.......................................................
RESPONSIBLE OFFICER........................................................
ROLLING THREE MONTH AVERAGE 90 DAY DELINQUENCY.............................
ROLLING SIX MONTH AVERAGE 90 DAY DELINQUENCY...............................
S&P........................................................................
SERIES.....................................................................
SERVICER...................................................................
Servicer CUMULATIVE LOSS TRIGGERS..........................................
SERVICER DEFAULT...........................................................
SERVICER DELINQUENCY RATE TRIGGER..........................................
SERVICER EMPLOYEES.........................................................
SERVICING ADVANCES.........................................................
SERVICING COMPENSATION.....................................................
SERVICING FEE..............................................................
Servicing Fee Rate.........................................................
SERVICING OFFICER..........................................................
STARTUP DAY................................................................
SUBSERVICER................................................................
SUBSERVICING AGREEMENT.....................................................
SUBSTITUTION ADJUSTMENT....................................................
TAX MATTERS PERSON.........................................................
TERMINATION PRICE..........................................................
TESTING DATE...............................................................
TRANSFER...................................................................
TRANSFER AFFIDAVIT AND AGREEMENT...........................................
TRANSFER AGREEMENT.........................................................
TRANSFEREE.................................................................
TRANSFEROR.................................................................
TRUST......................................................................
TRUST FUND.................................................................
TRUST REMIC................................................................
TRUSTEE....................................................................
UCC........................................................................
UNITED STATES PERSON.......................................................
UNPAID CLASS X REMITTANCE AMOUNT...........................................
VOTING INTEREST............................................................
ARTICLE II
CONVEYANCE OF THE TRUST ASSETS
Section 2.01 SALE AND CONVEYANCE OF TRUST ASSETS; PRIORITY AND
SUBORDINATION OF OWNERSHIP INTERESTS........................
Section 2.02 POSSESSION OF MORTGAGE FILES.................................
Section 2.03 BOOKS AND RECORDS............................................
Section 2.04 DELIVERY OF MORTGAGE LOAN DOCUMENTS..........................
Section 2.05 [RESERVED]...................................................
Section 2.06 ACCEPTANCE BY TRUSTEE OF THE TRUST FUND; CERTAIN
SUBSTITUTIONS; CERTIFICATION BY TRUSTEE.....................
Section 2.07 REMIC ADMINISTRATION.........................................
Section 2.08 EXECUTION OF CERTIFICATES....................................
Section 2.09 APPLICATION OF PRINCIPAL AND INTEREST........................
Section 2.10 GRANTOR TRUST ADMINISTRATION.................................
ARTICLE III
REPRESENTATIONS AND WARRANTIES
Section 3.01 REPRESENTATIONS OF THE SERVICER AND THE DEPOSITORS...........
Section 3.02 ASSIGNMENT OF TRANSFER AGREEMENT; REPRESENTATIONS AND
WARRANTIES AS TO THE INDIVIDUAL MORTGAGE LOANS AND THE
MORTGAGE POOL...............................................
Section 3.03 PURCHASE AND SUBSTITUTION....................................
ARTICLE IV
THE CERTIFICATES
Section 4.01 THE CERTIFICATES.............................................
Section 4.02 REGISTRATION OF TRANSFER AND EXCHANGE OF CERTIFICATES........
Section 4.03 MUTILATED, DESTROYED, LOST OR STOLEN CERTIFICATES............
Section 4.04 PERSONS DEEMED OWNERS........................................
Section 4.05 DETERMINATION OF LIBOR.......................................
ARTICLE V
ADMINISTRATION AND SERVICING OF THE MORTGAGE LOANS
Section 5.01 DUTIES OF THE SERVICER.......................................
Section 5.02 LIQUIDATION OF MORTGAGE LOANS................................
Section 5.03 ESTABLISHMENT OF PRINCIPAL AND INTEREST ACCOUNT; DEPOSITS
IN PRINCIPAL AND INTEREST ACCOUNT...........................
Section 5.04 PERMITTED WITHDRAWALS FROM THE PRINCIPAL AND INTEREST
ACCOUNT.....................................................
Section 5.05 PAYMENT OF TAXES, INSURANCE AND OTHER CHARGES................
Section 5.06 TRANSFER OF ACCOUNTS; MONTHLY STATEMENTS.....................
Section 5.07 MAINTENANCE OF HAZARD INSURANCE..............................
Section 5.08 MAINTENANCE OF MORTGAGE IMPAIRMENT INSURANCE POLICY..........
Section 5.09 FIDELITY BOND................................................
Section 5.10 TITLE, MANAGEMENT AND DISPOSITION OF REO PROPERTY............
Section 5.11 COLLECTION OF CERTAIN MORTGAGE LOAN PAYMENTS.................
Section 5.12 ACCESS TO CERTAIN DOCUMENTATION AND INFORMATION REGARDING
THE MORTGAGE LOANS..........................................
Section 5.13 SUPERIOR LIENS...............................................
ARTICLE VI
PAYMENTS TO THE CERTIFICATEHOLDERS
Section 6.01 ESTABLISHMENT OF COLLECTION ACCOUNTS; DEPOSIT IN ACCOUNTS....
Section 6.02 PERMITTED WITHDRAWALS FROM REMIC I DISTRIBUTION ACCOUNT,
REMIC II DISTRIBUTION ACCOUNT, REMIC III DISTRIBUTION
ACCOUNT AND REMIC IV DISTRIBUTION ACCOUNT...................
Section 6.03 ESTABLISHMENT OF INSURANCE ACCOUNT: DEPOSITS IN INSURANCE
ACCOUNT: PERMITTED WITHDRAWALS FROM INSURANCE ACCOUNT.......
Section 6.04 INVESTMENT OF ACCOUNTS.......................................
Section 6.05 PRIORITY AND SUBORDINATION OF DISTRIBUTIONS..................
Section 6.06 [RESERVED]...................................................
Section 6.07 STATEMENTS...................................................
Section 6.08 ADVANCES BY THE SERVICER.....................................
ARTICLE VII
GENERAL SERVICING PROCEDURES
Section 7.01 ASSUMPTION AGREEMENTS........................................
Section 7.02 SATISFACTION OF MORTGAGES AND RELEASE OF MORTGAGE FILES......
Section 7.03 SERVICING COMPENSATION.......................................
Section 7.04 ANNUAL STATEMENT AS TO COMPLIANCE............................
Section 7.05 ANNUAL INDEPENDENT PUBLIC ACCOUNTANTS' SERVICING REPORT......
Section 7.06 RIGHT TO EXAMINE SERVICER RECORDS............................
Section 7.07 REPORTS TO THE TRUSTEE; PRINCIPAL AND INTEREST ACCOUNT
STATEMENTS..................................................
ARTICLE VIII
REPORTS TO BE PROVIDED BY SERVICER
Section 8.01 FINANCIAL STATEMENTS.........................................
ARTICLE IX
THE SERVICER
Section 9.01 INDEMNIFICATION; THIRD PARTY CLAIMS..........................
Section 9.02 MERGER OR CONSOLIDATION OF THE SERVICER......................
Section 9.03 LIMITATION ON LIABILITY OF THE SERVICER AND OTHERS...........
Section 9.04 SERVICER NOT TO RESIGN.......................................
Section 9.05 REMOVAL OF SERVICER..........................................
ARTICLE X
SERVICER DEFAULT
Section 10.01 SERVICER DEFAULT.............................................
Section 10.02 TRUSTEE TO ACT; APPOINTMENT OF SUCCESSOR SERVICER............
Section 10.03 WAIVER OF DEFAULTS...........................................
Section 10.04 CONTROL BY MAJORITY IN AGGREGATE VOTING INTEREST.............
ARTICLE XI
TERMINATION
Section 11.01 TERMINATION..................................................
Section 11.02 ADDITIONAL TERMINATION REQUIREMENTS..........................
Section 11.03 ACCOUNTING UPON TERMINATION OF SERVICER......................
Section 11.04 REPRESENTATIVE'S RIGHT TO REPRESENTATIVE'S YIELD ABSOLUTE....
Section 11.05 TERMINATION UPON LOSS OF REMIC STATUS........................
ARTICLE XII
THE TRUSTEE
Section 12.01 DUTIES OF TRUSTEE............................................
Section 12.02 CERTAIN MATTERS AFFECTING THE TRUSTEE........................
Section 12.03 TRUSTEE NOT LIABLE FOR CERTIFICATES OR MORTGAGE LOANS........
Section 12.04 TRUSTEE MAY OWN CERTIFICATES.................................
Section 12.05 SERVICER TO PAY TRUSTEE'S FEES AND EXPENSES..................
Section 12.06 ELIGIBILITY REQUIREMENTS FOR TRUSTEE.........................
Section 12.07 RESIGNATION AND REMOVAL OF THE TRUSTEE.......................
Section 12.08 SUCCESSOR TRUSTEE............................................
Section 12.09 MERGER OR CONSOLIDATION OF TRUSTEE...........................
Section 12.10 APPOINTMENT OF CO-TRUSTEE OR SEPARATE TRUSTEE................
Section 12.11 APPOINTMENT OF CUSTODIANS....................................
Section 12.12 PROTECTION OF TRUST FUND.....................................
ARTICLE XIII
MISCELLANEOUS PROVISIONS
Section 13.01 THE CERTIFICATE INSURER......................................
Section 13.02 AMENDMENT....................................................
Section 13.03 RECORDATION OF AGREEMENT.....................................
Section 13.04 DURATION OF AGREEMENT........................................
Section 13.05 GOVERNING LAW................................................
Section 13.06 NOTICES......................................................
Section 13.07 SEVERABILITY OF PROVISIONS...................................
Section 13.08 NO PARTNERSHIP...............................................
Section 13.09 COUNTERPARTS.................................................
Section 13.10 SUCCESSORS AND ASSIGNS.......................................
Section 13.11 HEADINGS.....................................................
Section 13.12 LIMITATION OF LIABILITY OF TRUSTEE...........................
Section 13.13 LIMITATIONS ON RIGHTS OF OTHERS..............................
Section 13.14 NO PETITION..................................................
Section 13.15 THIRD PARTY BENEFICIARY......................................
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EXHIBITS
EXHIBIT A - Contents of Mortgage File
EXHIBIT B-1 - Form of Class A-1F Certificate
EXHIBIT B-2 - Form of Class A-2F Certificate
EXHIBIT B-3 - Form of Class A-3F Certificate
EXHIBIT B-4 - Form of Class A-4F Certificate
EXHIBIT B-5 - Form of Class A-5F Certificate
EXHIBIT B-6 - Form of Class A-6F Certificate
EXHIBIT B-7 - Form of Class A-7F Certificate
EXHIBIT B-8 - Form of Class A-1A Certificate
EXHIBIT B-9 - Form of Class X Certificate
EXHIBIT B-10 - Form of Class R-I Certificate
EXHIBIT B-11 Form of Class R-II Certificate
EXHIBIT B-12 - Form of Class R-III Certificate
EXHIBIT B-13 - Form of Class R-IV Certificate
EXHIBIT B-14 - Form of Reverse of Certificate
EXHIBIT C - DTC Letter of Representations
EXHIBIT D - Mortgage Loan Schedules
EXHIBIT E - Form of Trustee Initial Certification
EXHIBIT F-1 - Form of Trustee Interim Certification
EXHIBIT F-2 - Form of Trustee Final Certification
EXHIBIT G - List of Bankruptcy Loans
EXHIBIT H - Form of Delinquency Report
EXHIBIT I - Certificate Guaranty Insurance Policy
EXHIBIT J - Form of Transferor Certificate
EXHIBIT K - List of Originators
EXHIBIT L - [Reserved]
EXHIBIT M-1 - Form of Transfer Affidavit and Agreement
EXHIBIT M-2 - Form of Investor Representation Letter
EXHIBIT M-3 - Form of Transferor Representation Letter
EXHIBIT M-4 - Form of Rule 144A Investment Representation
EXHIBIT N - Form of Custodial Agreement
EXHIBIT O - Form of Liquidation Report
EXHIBIT P - Form of Principal and Interest Account Letter Agreement
EXHIBIT Q - Form of Notice to Certificate Insurer
EXHIBIT R - Monthly Information Delivered by Servicer
EXHIBIT S - List of Delinquency Loans
EXHIBIT T - Schedule of Mortgage Loans subject to the Home Ownership
and
Equity Protection Act of 1994
EXHIBIT U - Destroyed Mortgage Note Affidavit
EXHIBIT V - Schedule of Mortgage Loans that do not have Title Insurance
Policies
EXHIBIT W - [Reserved]
EXHIBIT X - [Reserved]
EXHIBIT Y - REO Resales
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POOLING AND SERVICING AGREEMENT
This Pooling and Servicing Agreement, dated as of August 1, 1999
(the "AGREEMENT"), is by and among EQUICREDIT CORPORATION OF AMERICA, as
representative (the "REPRESENTATIVE") and as servicer (the "SERVICER"), EQCC
RECEIVABLES CORPORATION and EQCC ASSET BACKED CORPORATION (collectively, the
"DEPOSITORS") and U.S. BANK NATIONAL ASSOCIATION as trustee (the "TRUSTEE"):
PRELIMINARY STATEMENT
In order to transfer certain Mortgage Loans from the Depositors to
the Trustee for the benefit of the Certificateholders and the Certificate
Insurer, as their interests may appear, and to facilitate the servicing of
certain Mortgage Loans by the Servicer, the Representative, the Servicer and the
Depositors are entering into this Agreement with the Trustee. The Depositors are
transferring the Mortgage Loans to the Trustee for the benefit of the
Certificateholders and the Certificate Insurer, as their interests may appear,
under this Agreement, pursuant to which thirteen classes of Certificates are
being issued, denominated on the face thereof as EQCC Home Equity Loan Asset
Backed Certificates, Series 1999-3, Class A-1F, Class A-2F, Class A-3F, Class
A-4F, Class A-5F, Class A-6F, Class A-7F, Class A-1A, Class X, Class R-I, Class
R-II, Class R-III and Class R-IV, respectively, representing in the aggregate a
100% ownership interest in the Mortgage Loans and all payments and other
collections thereon received on and after August 1, 1999 (the "CUT-OFF DATE)
(exclusive of the Representative's Yield and amounts received on and after the
Cut-off Date in respect of interest accrued prior to the Cut-off Date). As of
the Cut-off Date, the Mortgage Loans have an aggregate outstanding principal
balance of $1,000,000,143.63, the Mortgage Loans in the Adjustable Rate Group
have an aggregate outstanding principal balance of $37,812,197.35, the Mortgage
Loans in Fixed Rate Group 1 have an aggregate outstanding principal balance of
$887,796,138.38, and the Mortgage Loans in Fixed Rate Group 2 have an aggregate
outstanding principal balance of $74,391,807.90, in each case after application
of payments received by the Depositors on or before such date.
As provided herein, the Trustee will make an election to treat the
assets of the Trust Fund, other than the rights of Class A Certificateholders to
receive payments in respect of their related Interest Carryover, as four
separate REMICs (as defined herein) for federal income tax purposes. For federal
income tax purposes the Class A Certificates and Class X Certificates represent
beneficial interests in the "regular interests" in REMIC IV and the Class R-IV
Certificates represent the sole class of "residual interest" in REMIC IV for
purposes of the REMIC Provisions. The Class R-III Certificates represent the
sole class of "residual interest" in REMIC III, the Class R-II Certificates
represent the sole class of "residual interest" in REMIC II and the Class R-I
Certificates represent the sole class of "residual interest" in REMIC I for
purposes of the REMIC Provisions. There are also nine classes of uncertificated
REMIC I Regular Interests issued under this Agreement (the Class LT1, Class LT2,
Class LT3, Class LT4, Class LT5, Class LT6, Class LT7, Class LT8 and Class LT9
Interests), each of which will constitute regular interests in REMIC I. There
are also eighteen classes of uncertificated REMIC II Regular Interests issued
under this Agreement (the Class MT1, Class MT2, Class MT3, Class MT4, Class MT5,
Class MT6, Class MT7, Class MT8, Class MT9, Class MTN1, Class MTN2, Class MTN3,
Class MTN4, Class MTN5, Class MTN6, Class MTN7, Class MTN8 and Class MTN9
Interests), each of which will constitute regular interests in REMIC II. There
are also eleven classes of uncertificated REMIC III Regular Interests issued
under this Agreement (the Class NTA1, Class NTA2, Class NTA3, Class NTA4, Class
NTA5, Class NTA6, Class NTA7, Class NTA-1A, Class NTN1, Class NTN2 and Class
NTN3 Interests), each of which will constitute regular interests in REMIC III.
The REMIC I Regular Interests will be held as assets of REMIC II, the REMIC II
Regular Interests will be held as assets of REMIC III, and the REMIC III Regular
Interests will be held as assets of REMIC IV. In addition to representing
beneficial interests in the corresponding REMIC IV Regular Interests, the Class
A Certificates represent the right to receive payments in respect of their
related Interest Carryovers from amounts otherwise distributable to the Class X
Certificateholders. The Class X Certificates also represent beneficial interests
in the corresponding REMIC IV Regular Interest, subject to the obligation to
make payments to the Class A-1A Certificates in respect of Class A-1A LIBOR
Interest Carryovers, to the Fixed Rate Group 1 Certificates in respect of Fixed
Rate Group 1 Interest Carryovers and to the Fixed Rate Group 2 Certificates in
respect of Fixed Rate Group 2 Interest Carryovers.
The following table sets forth the designation, aggregate Original
Principal Balance and Final Scheduled Distribution Date for each Class of
Certificates comprising the interests in the Trust Fund.
FINAL SCHEDULED
DESIGNATION ORIGINAL PRINCIPAL BALANCE DISTRIBUTION DATE(1)
----------- -------------------------- --------------------
Class A-1F $350,000,000 April 25, 2010
Class A-2F $137,000,000 July 25, 2013
Class A-3F $160,000,000 November 25, 2024
Class A-4F $80,000,000 July 25, 2028
Class A-5F $27,796,013 August 25, 2030
Class A-6F $133,000,000 August 25, 2030
Class A-7F $74,391,790 August 25, 2030
Class A-1A $37,812,197 August 25, 2030
Class X N/A August 25, 2030
Class R-I N/A N/A
Class R-II N/A N/A
Class R-III N/A N/A
Class R-IV N/A N/A
- --------
(1) In each case, if the 25th is not a Business Day, the Final Scheduled
Distribution Date is the following Business Day.
Unless otherwise noted, references in this Agreement to percentages
of Mortgage Loans refer in each case to the percentage of the aggregate
principal balance of the Mortgage Loans as of the Cut-off Date, based on the
outstanding principal balances of the Mortgage Loans as of the Cut-off Date, and
giving effect to principal payments received prior to the Cut-off Date.
The parties hereto agree as follows:
ARTICLE I
DEFINITIONS
Whenever used herein, the following words and phrases, unless the
context otherwise requires, shall have the following meanings.
ACCOUNT: The Principal and Interest Account, the Collection Account,
the REMIC I Distribution Account, the REMIC II Distribution Account, the REMIC
III Distribution Account, the REMIC IV Distribution Account or the Insurance
Account.
ACCRUAL PERIOD: With respect to each Distribution Date and the Fixed
Rate Certificates and Fixed Rate Class X Components and the Class LT1, Class
LT2, Class LT3, Class LT4, Class LT5, Class LT6, Class MT1, Class MT2, Class
MT3, Class MT4, Class MT5, Class MT6, Class MTN1, Class MTN2, Class MTN3, Class
MTN4, Class MTN5, Class MTN6, Class NTA1, Class NTA2, Class NTA3, Class NTA4,
Class NTA5, Class NTA6, Class NTA7, Class NTN1 and Class NTN2 Interests, the
period from and including the first day of the immediately preceding calendar
month, commencing August 1, 1999, to and including the last day of the calendar
month immediately preceding the month in which such Distribution Date occurs.
With respect to each Distribution Date and the Class A-1A Certificates and
Adjustable Rate Class X Components and the Class LT7, Class LT8, Class LT9,
Class MT7, Class MT8, Class MT9, Class MTN7, Class MTN8, Class MTN9, Class
NTA-1A and Class NTN3 Interests, the period from and including the immediately
preceding Distribution Date or, in the case of the initial Accrual Period,
August 26, 1999, to but excluding such Distribution Date.
ACT: As defined in SECTION 4.02.
ADJUSTABLE RATE CLASS X COMPONENTS: The Class X-A Component and
clause (iii) of the definition of Class X-E Component.
ADJUSTABLE RATE GROUP: The group of Mortgage Loans indicated on the
Mortgage Loan Schedule as belonging to the Adjustable Rate Group.
ADJUSTABLE RATE GROUP AVAILABLE FUNDS: For any Distribution Date,
the Available Funds with respect to the Adjustable Rate Group.
ADJUSTABLE RATE GROUP COMPONENT REMITTANCE AMOUNTS: The Class X-A
Component Remittance Amount and clause (iii) of the definition of Class X-E
Component Remittance Amount.
ADJUSTABLE RATE GROUP EXCESS SPREAD: With respect to any
Distribution Date, the sum of (A) the excess (if any) of (a) the aggregate
interest received or advanced, pursuant to SECTION 6.08, for the related Due
Period, on the Mortgage Loans in the Adjustable Rate Group at their respective
Mortgage Interest Rates, over (b) the sum of (i) interest accrued on the Class
A-1A Certificates since the immediately prior Distribution Date, (ii) the
product of (x) 1/12th of the applicable Administrative Fee Rate and (y) the
aggregate of the principal balances of the Mortgage Loans in the Adjustable Rate
Group on which interest for such Due Period was calculated.
ADJUSTABLE RATE GROUP WEIGHTED AVERAGE MORTGAGE INTEREST RATE: As of
any date, the weighted average of the Mortgage Interest Rates on the Mortgage
Loans in the Adjustable Rate Group, adjusted to an actual/360 day accrual basis.
ADJUSTED INSURER FEE RATE: With respect to each Mortgage Loan Group
and each Accrual Period or Distribution Date, the product of (i) 0.105% per
annum and (ii) the Certificate Balance of the applicable Certificate Group
divided by the aggregate principal balance of the Mortgage Loans in the related
Mortgage Loan Group on which interest for such Accrual Period or Distribution
Date is calculated.
ADMINISTRATIVE FEE RATE: With respect to Fixed Rate Group 1 and
Fixed Rate Group 2 and any Accrual Period, the sum of (i) the Servicing Fee Rate
and (ii) the applicable Adjusted Insurer Fee Rate. With respect to the
Adjustable Rate Group and any Accrual Period, the sum of (i) the Servicing Fee
Rate, adjusted to an actual/360 day accrual basis and (ii) the applicable
Adjusted Insurer Fee Rate, adjusted to an actual/360 day accrual basis.
ADVANCE: An advance made by the Servicer pursuant to SECTION 6.08
hereof.
AFFILIATE: With respect to any specified Person, any other Person
controlling, 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.
AGREEMENT: This Pooling and Servicing Agreement and all amendments
hereof and supplements hereto.
ASSIGNMENT OF BENEFICIAL INTEREST: With respect to each Mortgage
Loan secured by an interest in an Illinois Land Trust, an instrument executed by
all of the beneficiaries of such Illinois Land Trust and by any Person having
any interest in such Illinois Land Trust or the power to direct the trustee
under such Illinois Land Trust, which assigns and transfers to the respective
Depositor as a secured party, all of the beneficiaries' rights, powers,
privileges and beneficial interest in such Illinois Land Trust.
ASSIGNMENT OF MORTGAGE: An assignment of the Mortgage, notice of
transfer or equivalent instrument sufficient, upon proper recordation thereof,
under the laws of the jurisdiction wherein the related Mortgaged Property is
located to reflect the record of the transfer of the Mortgage to the party named
as assignee therein.
AUTHORIZED DENOMINATIONS: The authorized denominations of the
Certificates, as set forth in SECTION 4.01 of this Agreement.
AVAILABLE FUNDS: With respect to any Distribution Date and each
Mortgage Loan Group, an amount equal to (i) the sum of all amounts described in
CLAUSES (I) THROUGH (VII), inclusive, of SECTION 5.03(A) received by the
Servicer or any Subservicer (including any amounts paid by the Servicer and the
Representative and excluding any amounts not required to be deposited in the
Principal and Interest Account pursuant to SECTION 5.03 and excluding any
amounts withdrawn by the Servicer pursuant to SECTION 5.04(II), (III), (V),
(VI), (VII) AND (X) as of the related Determination Date) during the related Due
Period with respect to the Mortgage Loans in such Mortgage Loan Group and on
deposit in the Collection Account on such Distribution Date, plus (ii) the
amount of any Advances remitted pursuant to SECTION 6.08 for such Distribution
Date with respect to the Mortgage Loans in such Mortgage Loan Group and on
deposit in the Collection Account on such Distribution Date. No amount included
in the Available Funds by virtue of being described by any component of the
definition thereof shall be included more than once by virtue of also being
described by any other component or otherwise.
BANKRUPTCY LOAN: Each Mortgage Loan set forth on EXHIBIT G hereto.
BASE OVERCOLLATERALIZATION TARGET AMOUNT: $26,633,884.15 for Fixed
Rate Group 1, $3,719,590.40 for Fixed Rate Group 2 and $3,875,750.23 for the
Adjustable Rate Group.
BASIC DOCUMENTS: The Transfer Agreement, this Pooling and Servicing
Agreement, the Custodial Agreement, the Certificate Depository Agreement and the
other documents and certificates delivered in connection therewith.
BASIC PRINCIPAL DISTRIBUTION AMOUNT: Each of the Fixed Rate Group 1
Basic Principal Distribution Amount, the Fixed Rate Group 2 Basic Principal
Distribution Amount and the Class A-1A Basic Principal Distribution Amount.
BOOK-ENTRY CERTIFICATES: A beneficial interest in the Certificates,
the ownership and transfer of which shall be made through book entries by the
Depository as described in SECTION 4.01 hereof.
BUSINESS DAY: Any day other than (i) a Saturday or Sunday or (ii) a
day on which banking institutions in the States of Illinois, New York or Florida
are authorized or obligated by law or executive order to be closed; PROVIDED,
HOWEVER, that on the Closing Date the Servicer shall provide the Trustee and the
Certificate Insurer with an Officer's Certificate listing the dates on which
banking institutions in the States of Illinois, Florida and New York are
authorized or obligated by law or executive order to be closed and the Servicer
shall deliver a new Officer's Certificate annually thereafter to the Trustee and
the Certificate Insurer prior to the expiration of the most recent list
provided. Failure to provide such an Officer's Certificate shall not constitute
an Event of Default; provided that the Trustee and the Certificate Insurer may
rely on the most recently delivered list without further investigation.
CERTIFICATE: Any Class A-1F Certificate, Class A-2F Certificate,
Class A-3F Certificate, Class A-4F Certificate, Class A-5F Certificate, Class
A-6F Certificate, Class A-7F, Class A-1A Certificate, Class X Certificate, Class
R-I Certificate, Class R-II Certificate, Class R-III Certificate or Class R-IV
Certificate executed by the Trustee on behalf of the Trust Fund and
authenticated by the Trustee or its authenticating agent, substantially in the
form annexed hereto as EXHIBITS B-1, B-2, B-3, B-4, B-5, B-6, B-7, B-8, B-9,
B-10, B-11, B-12 OR B13, respectively.
CERTIFICATE BALANCE: With respect to a Class, the aggregate
principal balance of the Certificates of such Class. With respect to a
Certificate Group, the aggregate principal balance of the Certificates in such
Certificate Group.
CERTIFICATE CUSTODIAN: Initially, U.S. Bank National Association;
thereafter, any other Certificate Custodian acceptable to the Depository and
selected by the Trustee.
CERTIFICATE DEPOSITORY AGREEMENT: The agreement, dated as of the
Closing Date, among the Depositors and the initial Depository, relating to the
Class A Certificates.
CERTIFICATE GROUP: Each of the Fixed Rate Group 1 Certificates, the
Fixed Rate Group 2 Certificates and the Class A-1A Certificates.
CERTIFICATE INSURANCE POLICY: The certificate guaranty insurance
policy number AB0285BE, in the name of the Trustee, dated the Closing Date,
issued by the Certificate Insurer for the benefit of the Class A
Certificateholders, pursuant to which the Certificate Insurer guarantees Insured
Payments, a copy of which is attached hereto as EXHIBIT I.
CERTIFICATE INSURER: Ambac Assurance Corporation, a Wisconsin stock
insurance company, or any successor thereof, as issuer of the Certificate
Insurance Policy.
CERTIFICATE OWNER: With respect to a Book-Entry Certificate, the
Person who is the beneficial owner of such Certificate as reflected on the books
of the Depository or on the books of a Depository Participant.
CERTIFICATE REGISTER: As described in Section 4.02 hereof.
CERTIFICATEHOLDER OR HOLDER: Each Person in whose name a Certificate
is registered in the Certificate Register; PROVIDED, HOWEVER, that, solely for
the purposes of giving any consent (except any consent required to be obtained
pursuant to SECTION 10.02), waiver, request or demand pursuant to this
Agreement, any Certificate registered in the name of the Representative, the
Servicer, any Originator or either Depositor, or any Affiliate of any of them,
shall be deemed not to be outstanding and the undivided Percentage Interest
evidenced thereby shall not be taken into account in determining whether the
requisite percentage of Certificates necessary to effect any such consent,
waiver, request or demand has been obtained. For purposes of any consent,
waiver, request or demand of Certificateholders pursuant to this Agreement, upon
the Trustee's or the Certificate Insurer's request, the Servicer, the
Representative, any Originator and either Depositor shall provide to the Trustee
and the Certificate Insurer a notice identifying any of their respective
Affiliates that is a Certificateholder as of the date(s) specified by the
Trustee or the Certificate Insurer in such request.
CLASS: Collectively, Certificates bearing the same alphabetical
designation (A-1F, A-2F, A-3F, A-4F, A-5F, A-6F, A-7F, A-1A, X, R-I, R-II, R-III
or R-IV).
CLASS A CERTIFICATEHOLDER: A Holder of a Class A Certificate.
CLASS A CERTIFICATES: The Class A-1F, Class A-2F , Class A-3F, Class
A-4F, Class A-5F, Class A-6F, Class A-7F and Class A-1A Certificates.
CLASS A INTEREST REMITTANCE AMOUNT: With respect to any Distribution
Date, the sum of the Fixed Rate Group 1 Aggregate Interest Remittance Amount,
the Fixed Rate Group 2 Interest Remittance Amount and the Class A-1A Interest
Remittance Amount for such Distribution Date.
CLASS A-1A BASIC PRINCIPAL DISTRIBUTION AMOUNT: As to any
Distribution Date, the lesser of (A) the Class A-1A Principal Balance as of such
Distribution Date and (B) the excess of (a) the Principal Remittance Amount for
the Adjustable Rate Group for such Distribution Date over (b) the
Overcollateralization Release Amount, if any, for the Class A-1A Certificates
for such Distribution Date.
CLASS A-1A CERTIFICATE: A Certificate designated as an EQCC Home
Equity Loan Asset Backed Certificate, Series 1999-3, Class A-1A Certificate, and
evidencing (i) a beneficial interest in a "regular interest" in REMIC IV for
purposes of the REMIC Provisions and (ii) the right to receive payments in
respect of Class A-1A LIBOR Interest Carryovers from amounts otherwise
distributable to the Class X Certificates.
CLASS A-1A CERTIFICATEHOLDER: A Holder of a Class A-1A Certificate.
CLASS A-1A INTEREST REMITTANCE AMOUNT: For any Distribution Date,
the aggregate interest accrued during the related Accrual Period at the Class
A-1A Pass-Through Rate on the Class A-1A Principal Balance from time to time
outstanding during such Accrual Period (after giving effect to distributions of
principal made on the preceding Distribution Date), calculated on the basis of
actual number of days over a 360 day year.
CLASS A-1A LIBOR INTEREST CARRYOVER: An amount, calculated on any
Distribution Date on which the Class A-1A Pass-Through Rate is equal to the
Class A-1A Net Funds Cap Rate, equal to (i) the difference between (a) the
amount of interest the Class A-1A Certificates would be entitled to receive on
such Distribution Date without regard to the Class A-1A Net Funds Cap Rate and
(b) the amount of interest actually distributed to the Class A-1A Certificates
on such Distribution Date, plus (ii) the portion of any amount calculated
pursuant to clause (i) remaining unpaid from prior Distribution Dates and
interest accrued thereon at the then-applicable Class A-1A LIBOR Rate
(calculated without regard to the Class A-1A Net Funds Cap Rate).
CLASS A-1A LIBOR RATE: For any Accrual Period, LIBOR as of the
related LIBOR Determination Date plus (i) 0.31% on each Distribution Date on or
prior to the Optional Purchase Date and (ii) 0.62% on each Distribution Date
following the Optional Purchase Date.
CLASS A-1A NET FUNDS CAP RATE: With respect to any Accrual Period, a
per annum rate equal to the Adjustable Rate Group Weighted Average Mortgage
Interest Rate as of the first day of the related Due Period less either (i) the
applicable Administrative Fee Rate, with respect to the first twelve Accrual
Periods or (ii) the sum of (a) 0.50% per annum and (b) the applicable
Administrative Fee Rate, with respect to each subsequent Accrual Period.
CLASS A-1A PASS-THROUGH RATE: For the initial Accrual Period, 5.655%
per annum and for any Accrual Period thereafter, the lesser of (i) the Class
A-1A LIBOR Rate for such Accrual Period and (ii) the Class A-1A Net Funds Cap
Rate for such Accrual Period.
CLASS A-1A PRINCIPAL BALANCE: As of any date of determination, the
Original Class A-1A Principal Balance, reduced by the sum of all amounts
(including, except for purposes of effecting the Certificate Insurer's
subrogation rights, that portion of Insured Payments, if any, made in respect of
principal) previously distributed to Class A-1A Certificateholders in respect of
principal.
CLASS A-1F CERTIFICATE: A Certificate designated as an EQCC Home
Equity Loan Asset Backed Certificate, Series 1999-3, Class A-1F Certificate, and
evidencing (i) a beneficial interest in a "regular interest" in REMIC IV for
purposes of the REMIC Provisions and (ii) the right to receive payments in
respect of Fixed Rate Group 1 Interest Carryovers from amounts otherwise
distributable to the Class X Certificates.
CLASS A-1F PASS-THROUGH RATE: For any Accrual Period, the lesser of
(i) 6.548% per annum and (ii) the Fixed Rate Group 1 Net Funds Cap Rate.
CLASS A-1F PRINCIPAL BALANCE: As of any date of determination, the
Original Class A-1F Principal Balance, reduced by the sum of all amounts
(including, except for purposes of effecting the Certificate Insurer's
subrogation rights, that portion of Insured Payments, if any, made in respect of
principal) previously distributed to Class A-1F Certificateholders in respect of
principal.
CLASS A-2F CERTIFICATE: A Certificate designated as an EQCC Home
Equity Loan Asset Backed Certificate, Series 1999-3, Class A-2F Certificate, and
evidencing (i) a beneficial interest in a "regular interest" in REMIC IV for
purposes of the REMIC Provisions and (ii) the right to receive payments in
respect of Fixed Rate Group 1 Interest Carryovers from amounts otherwise
distributable to the Class X Certificates.
CLASS A-2F PASS-THROUGH RATE: For any Accrual Period, the lesser of
(i) 6.887% per annum and (ii) the Fixed Rate Group 1 Net Funds Cap Rate.
CLASS A-2F PRINCIPAL BALANCE: As of any date of determination, the
Original Class A-2F Principal Balance, reduced by the sum of all amounts
(including, except for purposes of effecting the Certificate Insurer's
subrogation rights, that portion of Insured Payments, if any, made in respect of
principal) previously distributed to Class A-2F Certificateholders in respect of
principal.
CLASS A-3F CERTIFICATE: A Certificate designated as an EQCC Home
Equity Loan Asset Backed Certificate, Series 1999-3, Class A-3F Certificate, and
evidencing (i) a beneficial interest in a "regular interest" in REMIC IV for
purposes of the REMIC Provisions and (ii) the right to receive payments in
respect of Fixed Rate Group 1 Interest Carryovers from amounts otherwise
distributable to the Class X Certificates.
CLASS A-3F PASS-THROUGH RATE: For any Accrual Period, the lesser of
(i) 7.067% per annum and (ii) the Fixed Rate Group 1 Net Funds Cap Rate.
CLASS A-3F PRINCIPAL BALANCE: As of any date of determination, the
Original Class A-3F Principal Balance, reduced by the sum of all amounts
(including, except for purposes of effecting the Certificate Insurer's
subrogation rights, that portion of Insured Payments, if any, made in respect of
principal) previously distributed to Class A-3F Certificateholders in respect of
principal.
CLASS A-4F CERTIFICATE: A Certificate designated as an EQCC Home
Equity Loan Asset Backed Certificate, Series 1999-3, Class A-4F Certificate, and
evidencing (i) a beneficial interest in a "regular interest" in REMIC IV for
purposes of the REMIC Provisions and (ii) the right to receive payments in
respect of Fixed Rate Group 1 Interest Carryovers from amounts otherwise
distributable to the Class X Certificates.
CLASS A-4F PASS-THROUGH RATE: For any Accrual Period, the lesser of
(i) 7.371% per annum and (ii) the Fixed Rate Group 1 Net Funds Cap Rate.
CLASS A-4F PRINCIPAL BALANCE: As of any date of determination, the
Original Class A-4F Principal Balance, reduced by the sum of all amounts
(including, except for purposes of effecting the Certificate Insurer's
subrogation rights, that portion of Insured Payments, if any, made in respect of
principal) previously distributed to Class A-4F Certificateholders in respect of
principal.
CLASS A-5F CERTIFICATE: A Certificate designated as an EQCC Home
Equity Loan Asset Backed Certificate, Series 1999-3, Class A-5F Certificate, and
evidencing (i) a beneficial interest in a "regular interest" in REMIC IV for
purposes of the REMIC Provisions and (ii) the right to receive payments in
respect of Fixed Rate Group 1 Interest Carryovers from amounts otherwise
distributable to the Class X Certificates.
CLASS A-5F PASS-THROUGH RATE: For any Accrual Period, the lesser of
(i)(a) 7.638% per annum for each Distribution Date on or prior to the Optional
Purchase Date or (b) 8.138% per annum for each Distribution Date following the
Optional Purchase Date and (ii) the Fixed Rate Group 1 Net Funds Cap Rate.
CLASS A-5F PRINCIPAL BALANCE: As of any date of determination, the
Original Class A-5F Principal Balance, reduced by the sum of all amounts
(including, except for purposes of effecting the Certificate Insurer's
subrogation rights, that portion of Insured Payments, if any, made in respect of
principal) previously distributed to Class A-5F Certificateholders in respect of
principal.
CLASS A-6F CERTIFICATE: A Certificate designated as an EQCC Home
Equity Loan Asset Backed Certificate, Series 1999-3, Class A-6F Certificate, and
evidencing (i) a beneficial interest in a "regular interest" in REMIC IV for
purposes of the REMIC Provisions and (ii) the right to receive payments in
respect of Fixed Rate Group 1 Interest Carryovers from amounts otherwise
distributable to the Class X Certificates.
CLASS A-6F PASS-THROUGH RATE: For any Accrual Period, the lesser of
(i) 7.267% per annum and (ii) the Fixed Rate Group 1 Net Funds Cap Rate.
CLASS A-6F PRINCIPAL BALANCE: As of any date of determination, the
Original Class A-6F Principal Balance, reduced by the sum of all amounts
(including, except for purposes of effecting the Certificate Insurer's
subrogation rights, that portion of Insured Payments, if any, made in respect of
principal) previously distributed to Class A-6F Certificateholders in respect of
principal.
CLASS A-7F CERTIFICATE: A Certificate designated as an EQCC Home
Equity Loan Asset Backed Certificate, Series 1999-3, Class A-7F Certificate, and
evidencing (i) a beneficial interest in a "regular interest" in REMIC IV for
purposes of the REMIC Provisions and (ii) the right to receive payments in
respect of Fixed Rate Group 2 Interest Carryovers from amounts otherwise
distributable to the Class X Certificates.
CLASS A-7F PASS-THROUGH RATE: For any Accrual Period, the lesser of
(i) (a) 7.448% per annum for each Distribution Date on or prior to the Optional
Purchase Date or (b) 7.948% per annum for each Distribution Date following the
Optional Purchase Date and (ii) the Fixed Rate Group 2 Net Funds Cap Rate.
CLASS A-7F PRINCIPAL BALANCE: As of any date of determination, the
Original Class A-7F Principal Balance, reduced by the sum of all amounts
(including, except for purposes of effecting the Certificate Insurer's
subrogation rights, that portion of Insured Payments, if any, made in respect of
principal) previously distributed to Class A-7F Certificateholders in respect of
principal.
CLASS LT1 INTEREST: A regular interest in REMIC I that is held as an
asset of REMIC II that has a principal balance as of any date equal to 98% of
the aggregate Pool Principal Balance of Fixed Rate Group 1 Mortgage Loans and
bears interest at the Net Fixed Rate Group 1 Weighted Average Mortgage Interest
Rate.
CLASS LT2 INTEREST: A regular interest in REMIC I that is held as an
asset of REMIC II that has a principal balance as of any date equal to 1% of the
amount by which (i) the aggregate Pool Principal Balance of Fixed Rate Group 1
Mortgage Loans exceeds (ii) the Group 1 OC Amount and bears interest at the Net
Fixed Rate Group 1 Weighted Average Mortgage Interest Rate.
CLASS LT3 INTEREST: A regular interest in REMIC I that is held as an
asset of REMIC II that has a principal balance as of any date equal to 1% of the
sum of (i) the aggregate Pool Principal Balance of Fixed Rate Group 1 Mortgage
Loans and (ii) the Group 1 OC Amount and bears interest at the Net Fixed Rate
Group 1 Weighted Average Mortgage Interest Rate.
CLASS LT4 INTEREST: A regular interest in REMIC I that is held as an
asset of REMIC II that has a principal balance as of any date equal to 98% of
the aggregate Pool Principal Balance of Fixed Rate Group 2 Mortgage Loans and
bears interest at the Net Fixed Rate Group 2 Weighted Average Mortgage Interest
Rate.
CLASS LT5 INTEREST: A regular interest in REMIC I that is held as an
asset of REMIC II that has a principal balance as of any date equal to 1% of the
Class A-7F Principal Balance and bears interest at the Net Fixed Rate Group 2
Weighted Average Mortgage Interest Rate.
CLASS LT6 INTEREST: A regular interest in REMIC I that is held as an
asset of REMIC II that has a principal balance as of any date equal to 1% of the
sum of (i) the aggregate Pool Principal Balance of Fixed Rate Group 2 Mortgage
Loans and (ii) the Group 2 OC Amount and bears interest at the Net Fixed Rate
Group 2 Weighted Average Mortgage Interest Rate.
CLASS LT7 INTEREST: A regular interest in REMIC I that is held as an
asset of REMIC II that has a principal balance as of any date equal to 98% of
the aggregate Pool Principal Balance of the Adjustable Rate Group Mortgage Loans
and bears interest at the Net Adjustable Rate Group Weighted Average Mortgage
Interest Rate.
CLASS LT8 INTEREST: A regular interest in REMIC I that is held as an
asset of REMIC II that has a principal balance as of any date equal to 1% of the
Class A-1A Principal Balance and bears interest at the Net Adjustable Rate Group
Weighted Average Mortgage Interest Rate.
CLASS LT9 INTEREST: A regular interest in REMIC I that is held as an
asset of REMIC II that has a principal balance as of any date equal to 1% of the
sum of (i) the aggregate Pool Principal Balance of the Adjustable Rate Group
Mortgage Loans and (ii) the Group A-1A OC Amount and bears interest at the Net
Adjustable Rate Group Weighted Average Mortgage Interest Rate.
CLASS MT1 INTEREST: A regular interest in REMIC II that is held as
an asset of REMIC III that has a principal balance as of any date equal to the
principal balance of the Class LT1 Interest and bears interest at the REMIC II
Group 1 Interest Rate.
CLASS MT2 INTEREST: A regular interest in REMIC II that is held as
an asset of REMIC III that has a principal balance as of any date equal to the
principal balance of the Class LT2 Interest and bears interest at the REMIC II
Group 1 Interest Rate.
CLASS MT3 INTEREST: A regular interest in REMIC II that is held as
an asset of REMIC III that has a principal balance as of any date equal to the
principal balance of the Class LT3 Interest and bears interest at the REMIC II
Group 1 Interest Rate.
CLASS MT4 INTEREST: A regular interest in REMIC II that is held as
an asset of REMIC III that has a principal balance as of any date equal to the
principal balance of the Class LT4 Interest and bears interest at the REMIC II
Group 2 Interest Rate.
CLASS MT5 INTEREST: A regular interest in REMIC II that is held as
an asset of REMIC III that has a principal balance as of any date equal to the
principal balance of the Class LT5 Interest and bears interest at the REMIC II
Group 2 Interest Rate.
CLASS MT6 INTEREST: A regular interest in REMIC II that is held as
an asset of the REMIC III that has a principal balance as of any date equal to
the principal balance of the Class LT6 Interest and bears interest at the REMIC
II Group 2 Interest Rate.
CLASS MT7 INTEREST: A regular interest in REMIC II that is held as
an asset of REMIC III that has a principal balance as of any date equal to the
principal balance of the Class LT7 Interest and bears interest at the REMIC II
Group 3 Interest Rate.
CLASS MT8 INTEREST: A regular interest in REMIC II that is held as
an asset of REMIC III that has a principal balance as of any date equal to the
principal balance of the Class LT8 Interest and bears interest at the REMIC II
Group 3 Interest Rate.
CLASS MT9 INTEREST: A regular interest in REMIC II that is held as
an asset of REMIC III that has a principal balance as of any date equal to the
principal balance of the Class LT9 Interest and bears interest at the REMIC II
Group 3 Interest Rate.
CLASS MTN1 INTEREST: A regular interest in REMIC II that is held as
an asset of REMIC III that has a notional amount as of any date equal to the
principal balance of the Class LT1 Interest and bears interest at a rate equal
to (I) the Net Fixed Rate Group 1 Weighted Average Mortgage Interest Rate minus
(II) the REMIC II Group 1 Interest Rate.
CLASS MTN2 INTEREST: A regular interest in REMIC II that is held as
an asset of REMIC III that has a notional amount as of any date equal to the
principal balance of the Class LT2 Interest and bears interest at a rate equal
to (I) the Net Fixed Rate Group 1 Weighted Average Mortgage Interest Rate minus
(II) the REMIC II Group 1 Interest Rate.
CLASS MTN3 INTEREST: A regular interest in REMIC II that is held as
an asset of REMIC III that has a notional amount as of any date equal to the
principal balance of the Class LT3 Interest and bears interest at a rate equal
to (I) the Net Fixed Rate Group 1 Weighted Average Mortgage Interest Rate minus
(II) the REMIC II Group 1 Interest Rate.
CLASS MTN4 INTEREST: A regular interest in REMIC II that is held as
an asset of REMIC III that has a notional amount as of any date equal to the
principal balance of the Class LT4 Interest and bears interest at a rate equal
to (I) the Net Fixed Rate Group 2 Weighted Average Mortgage Interest Rate minus
(II) the REMIC II Group 2 Interest Rate.
CLASS MTN5 INTEREST: A regular interest in REMIC II that is held as
an asset of REMIC III that has a notional amount as of any date equal to the
principal balance of the Class LT5 Interest and bears interest at a rate equal
to (I) the Net Fixed Rate Group 2 Weighted Average Mortgage Interest Rate minus
(II) the REMIC II Group 2 Interest Rate.
CLASS MTN6 INTEREST: A regular interest in REMIC II that is held as
an asset of REMIC III that has a notional amount as of any date equal to the
principal balance of the Class LT6 Interest and bears interest at a rate equal
to (I) the Net Fixed Rate Group 2 Weighted Average Mortgage Interest Rate minus
(II) the REMIC II Group 2 Interest Rate.
CLASS MTN7 INTEREST: A regular interest in REMIC II that is held as
an asset of REMIC III that has a notional amount as of any date equal to the
principal balance of the Class LT7 Interest and bears interest at a rate equal
to (I) the Net Adjustable Rate Group Weighted Average Mortgage Interest Rate
minus (II) the REMIC II Group 3 Interest Rate.
CLASS MTN8 INTEREST: A regular interest in REMIC II that is held as
an asset of REMIC III that has a notional amount as of any date equal to the
principal balance of the Class LT8 Interest and bears interest at a rate equal
to (I) the Net Adjustable Rate Group Weighted Average Mortgage Interest Rate
minus (II) the REMIC II Group 3 Interest Rate.
CLASS MTN9 INTEREST: A regular interest in REMIC II that is held as
an asset of REMIC III that has a notional amount as of any date equal to the
principal balance of the Class LT9 Interest and bears interest at a rate equal
to (I) the Net Adjustable Rate Group Weighted Average Mortgage Interest Rate
minus (II) the REMIC II Group 3 Interest Rate.
CLASS NTA1 INTEREST: A regular interest in REMIC III that is held as
an asset of REMIC IV that has a principal balance as of any date equal to the
Class A-1F Principal Balance and bears interest at the Net Fixed Rate Group 1
Weighted Average Mortgage Interest Rate.
CLASS NTA2 INTEREST: A regular interest in REMIC III that is held as
an asset of REMIC IV that has a principal balance as of any date equal to the
Class A-2F Principal Balance and bears interest at the Net Fixed Rate Group 1
Weighted Average Mortgage Interest Rate.
CLASS NTA3 INTEREST: A regular interest in REMIC III that is held as
an asset of REMIC IV that has a principal balance as of any date equal to the
Class A-3F Principal Balance and bears interest at the Net Fixed Rate Group 1
Weighted Average Mortgage Interest Rate.
CLASS NTA4 INTEREST: A regular interest in REMIC III that is held as
an asset of REMIC IV that has a principal balance as of any date equal to the
Class A-4F Principal Balance and bears interest at the Net Fixed Rate Group 1
Weighted Average Mortgage Interest Rate.
CLASS NTA5 INTEREST: A regular interest in REMIC III that is held as
an asset of REMIC IV that has a principal balance as of any date equal to the
Class A-5F Principal Balance and bears interest at the Net Fixed Rate Group 1
Weighted Average Mortgage Interest Rate.
CLASS NTA6 INTEREST: A regular interest in REMIC III that is held as
an asset of REMIC IV that has a principal balance as of any date equal to the
Class A-6F Principal Balance and bears interest at the Net Fixed Rate Group 1
Weighted Average Mortgage Interest Rate.
CLASS NTA7 INTEREST: A regular interest in REMIC III that is held as
an asset of REMIC IV that has a principal balance as of any date equal to the
Class A-7F Principal Balance and bears interest at the Net Fixed Rate Group 2
Weighted Average Mortgage Interest Rate.
CLASS NTA-1A INTEREST: A regular interest in REMIC III that is held
as an asset of REMIC IV that has a principal balance as of any date equal to the
Class A-1A Principal Balance and bears interest at the Net Adjustable Rate Group
Weighted Average Mortgage Interest Rate.
CLASS NTN1 INTEREST: A regular interest in REMIC III that is held as
an asset of REMIC IV that has a notional amount as of any date equal to the sum
of the notional amounts of the Class MTN1, Class MTN2 and Class MTN3 Interests
and is entitled to all interest accrued or distributed in respect of the Class
MTN1, Class MTN2 and Class MTN3 Interests.
CLASS NTN2 INTEREST: A regular interest in REMIC III that is held as
an asset of REMIC IV that has a notional amount as of any date equal to the sum
of the notional amounts of the Class MTN4, Class MTN5 and Class MTN6 Interests
and is entitled to all interest accrued or distributed in respect of the Class
MTN4, Class MTN5 and Class MTN6 Interests.
CLASS NTN3 INTEREST: A regular interest in REMIC III that is held as
an asset of REMIC IV that has a notional amount as of any date equal to the sum
of the notional amounts of the Class MTN7, Class MTN8 and Class MTN9 Interests
and is entitled to all interest accrued or distributed in respect of the Class
MTN7, Class MTN8 and Class MTN9 Interests.
CLASS R-I CERTIFICATE: A Certificate designated as an EQCC Home
Equity Loan Asset Backed Certificate, Series 1999-3, Class R-I Certificate, and
evidencing an interest designated as the "residual interest" in REMIC I for
purposes of the REMIC Provisions.
CLASS R-I CERTIFICATEHOLDER: A Holder of a Class R-I Certificate.
CLASS R-II CERTIFICATE: A Certificate designated as an EQCC Home
Equity Loan Asset Backed Certificate, Series 1999-3, Class R-II Certificate and
evidencing an interest designated as the "residual interest" in REMIC II for
purposes of the REMIC Provisions.
CLASS R-II CERTIFICATEHOLDER: A Holder of a Class R-II Certificate.
CLASS R-III CERTIFICATE: A Certificate designated as an EQCC Home
Equity Loan Asset Backed Certificate, Series 1999-3, Class R-III Certificate and
evidencing an interest designated as the "residual interest" in REMIC III for
purposes of the REMIC Provisions.
CLASS R-III CERTIFICATEHOLDER: A Holder of a Class R-III
Certificate.
CLASS R-IV CERTIFICATE: A Certificate designated as an EQCC Home
Equity Loan Asset Backed Certificate, Series 1999-3, Class R-IV Certificate, and
evidencing an interest designated as the "residual interest" in REMIC IV for
purposes of the REMIC Provisions.
CLASS R-IV CERTIFICATEHOLDER: A Holder of a Class R-IV Certificate.
CLASS X CERTIFICATE: A Certificate designated as an EQCC Home Equity
Loan Asset Backed Certificate, Series 1999-3, Class X Certificate evidencing (i)
a "regular interest" in the REMIC IV for purposes of the REMIC Provisions and
(ii) rights and obligations as described herein.
CLASS X CERTIFICATEHOLDER: A Holder of a Class X Certificate.
CLASS X-A COMPONENT: A Component of the Class X Interest
representing a specified portion of the interest payments on the Class NTA-1A
Interest and entitled to the Class X-A Component Remittance Amount.
CLASS X-A COMPONENT REMITTANCE AMOUNT: For any Distribution Date,
the product of 1/12th of (i) the excess, if any, of (a) the Net Adjustable Rate
Group Weighted Average Mortgage Interest Rate over (b) the Class A-1A
Pass-Through Rate for the related Accrual Period, adjusted to an actual/360 day
accrual basis, and (ii) the Class A-1A Principal Balance for such Distribution
Date (before giving effect to any principal distributions on such Distribution
Date).
CLASS X-1F COMPONENT: A Component of the Class X Interest
representing a specified portion of the interest payments on the Class NTA1
Interest and entitled to the Class X-1F Component Remittance Amount.
CLASS X-1F COMPONENT REMITTANCE AMOUNT: For any Distribution Date,
the product of 1/12th of (i) the excess, if any, of (a) the Net Fixed Rate Group
1 Weighted Average Mortgage Interest Rate over (b) the Class A-1F Pass-Through
Rate for the related Accrual Period and (ii) the Class A-1F Principal Balance
for such Distribution Date (before giving effect to any principal distributions
on such Distribution Date).
CLASS X-2F COMPONENT: A Component of the Class X Interest
representing a specified portion of the interest payments on the Class NTA2
Interest and entitled to the Class X-2F Component Remittance Amount.
CLASS X-2F COMPONENT REMITTANCE AMOUNT: For any Distribution Date,
the product of 1/12th of (i) the excess, if any, of (a) the Net Fixed Rate Group
1 Weighted Average Mortgage Interest Rate over (b) the Class A-2F Pass-Through
Rate for the related Accrual Period and (ii) the Class A-2F Principal Balance
for such Distribution Date (before giving effect to any principal distributions
on such Distribution Date).
CLASS X-3F COMPONENT: A Component of the Class X Interest
representing a specified portion of the interest payments on the Class NTA3
Interest and entitled to the Class X-3F Component Remittance Amount.
CLASS X-3F COMPONENT REMITTANCE AMOUNT: For any Distribution Date,
the product of 1/12th of (i) the excess, if any, of (a) the Net Fixed Rate Group
1 Weighted Average Mortgage Interest Rate over (b) the Class A-3F Pass-Through
Rate for the related Accrual Period and (ii) the Class A-3F Principal Balance
for such Distribution Date (before giving effect to any principal distributions
on such Distribution Date).
CLASS X-4F COMPONENT: A Component of the Class X Interest
representing a specified portion of the interest payments on the Class NTA4
Interest and entitled to the Class X-4F Component Remittance Amount.
CLASS X-4F COMPONENT REMITTANCE AMOUNT: For any Distribution Date,
the product of 1/12th of (i) the excess, if any, of (a) the Net Fixed Rate Group
1 Weighted Average Mortgage Interest Rate over (b) the Class A-4F Pass-Through
Rate for the related Accrual Period and (ii) the Class A-4F Principal Balance
for such Distribution Date (before giving effect to any principal distributions
on such Distribution Date).
CLASS X-5F COMPONENT: A Component of the Class X Interest
representing a specified portion of the interest payments on the Class NTA5
Interest and entitled to the Class X-5F Component Remittance Amount.
CLASS X-5F COMPONENT REMITTANCE AMOUNT: For any Distribution Date,
the product of 1/12th of (i) the excess, if any, of (a) the Net Fixed Rate Group
1 Weighted Average Mortgage Interest Rate over (b) the Class A-5F Pass-Through
Rate for the related Accrual Period and (ii) the Class A-5F Principal Balance
for such Distribution Date (before giving effect to any principal distributions
on such Distribution Date).
CLASS X-6F COMPONENT: A Component of the Class X Interest
representing a specified portion of the interest payments on the Class NTA6
Interest and entitled to the Class X-6F Component Remittance Amount.
CLASS X-6F COMPONENT REMITTANCE AMOUNT: For any Distribution Date,
the product of 1/12th of (i) the excess, if any, of (a) the Net Fixed Rate Group
1 Weighted Average Mortgage Interest Rate over (b) the Class A-6F Pass-Through
Rate for the related Accrual Period and (ii) the Class A-6F Principal Balance
for such Distribution Date (before giving effect to any principal distributions
on such Distribution Date).
CLASS X-7F COMPONENT: A Component of the Class X Interest
representing a specified portion of the interest payments on the Class NTA7
Interest and entitled to the Class X-7F Component Remittance Amount.
CLASS X-7F COMPONENT REMITTANCE AMOUNT: For any Distribution Date,
the product of 1/12th of (i) the excess, if any, of (a) the Net Fixed Rate Group
2 Weighted Average Mortgage Interest Rate over (b) the Class A-7F Pass-Through
Rate for the related Accrual Period and (ii) the Class A-7F Principal Balance
for such Distribution Date (before giving effect to any principal distributions
on such Distribution Date).
CLASS X-E COMPONENT: A Component of the Class X Interest
representing a specified portion of the interest payments on (i) the Class NTN1
Interest, (ii) the Class NTN2 Interest and (iii) the Class NTN3 Interest and
entitled to the respective portions of the Class X-E Component Remittance
Amount.
CLASS X-E COMPONENT REMITTANCE AMOUNT: For any Distribution Date,
the sum of (i) the interest distributed in respect of the Class NTN1 Interest,
(ii) the interest distributed in respect of the Class NTN2 Interest, and (iii)
the interest distributed in respect of the Class NTN3 Interest for such
Distribution Date (before giving effect to any principal distributions on such
Distribution Date).
CLASS X-F COMPONENT REMITTANCE AMOUNT: For any Distribution Date,
the sum of the Class X-1F Component Remittance Amount, the Class X-2F Component
Remittance Amount, Class X-3F Component Remittance Amount, the Class X-4F
Component Remittance Amount, Class X-5F Component Remittance Amount, the Class
X-6F Component Remittance Amount and the Class X-7F Component Remittance Amount.
CLASS X INTEREST: A regular interest in REMIC IV, ownership of which
is evidenced by the Class X Certificates.
CLASS X REMITTANCE AMOUNT: An amount equal to the sum of the Class
X-A Component Remittance Amount, the Class X-E Component Remittance Amount and
the Class X-F Component Remittance Amount.
CLOSING DATE: August 26, 1999.
CODE: The Internal Revenue Code of 1986, as amended from time to
time.
COLLECTION ACCOUNT: The collection account established and
maintained by the Trustee pursuant to SECTION 6.01 hereof.
COLLECTIONS: For any Due Period, the amounts collected by the
Servicer with respect to the Mortgage Loans set forth in SECTION 5.03(A),
CLAUSES (I)-(VIII) that are required to be deposited to the Collection Account
pursuant to SECTION 5.04 with respect to the related Distribution Date (and not
including amounts that are permitted to be withdrawn from the Principal and
Interest Account pursuant to SECTION 5.04).
COMBINED LOAN-TO-VALUE RATIO or CLTV: With respect to any Mortgage
Loan, the ratio (expressed as a percentage) of (a) the sum of the original
principal balance of such Mortgage Loan and the outstanding principal balance of
any related First Lien as of the date of origination of the Mortgage Loan,
divided by (b) (i) the lesser of (1) the value of the related Mortgaged
Property, based upon the appraisal made at the time such Mortgage Loan was
originated, or (2) the purchase price of the Mortgaged Property if the Mortgage
Loan proceeds were used to purchase the Mortgaged Property or (ii) in the case
of a Mortgage Loan that has been deemed reissued for purposes of Section 1001 of
the Code as a result of modifications thereto, the value of the Mortgaged
Property based upon the appraisal made at the date of the most recent deemed
reissuance.
COMMISSION: The Securities and Exchange Commission.
CORPORATE TRUST OFFICE: With respect to the Trustee, the principal
office at which at any particular time the corporate trust business of the
Trustee shall be principally administered, which offices at the Closing Date are
located at U.S. Bank National Association, 111 East Wacker Drive, Suite 3000,
Chicago, Illinois 60601.
CUMULATIVE LOSSES: As of any date of determination, the aggregate
Mortgage Loan Losses for all Due Periods since the Cut-off Date.
CUMULATIVE LOSS PERCENTAGE: With respect to any Distribution
Date, the fraction expressed as a percentage equal to the Cumulative Losses
over the Original Pool Principal Balance.
CURRENT CLTV: With respect to any Bankruptcy Loan, the ratio
(expressed as a percentage) of (a) the sum of (i) the outstanding principal
balance as of the Cut-off Date of such Mortgage Loan and (ii) the outstanding
principal balance of any related First Lien as of the Cut-off Date divided by
(b) the current appraised value of the related Mortgaged Property, as determined
by an independent fee appraiser acceptable to the Certificate Insurer within 60
days of the Closing Date.
CURTAILMENT: With respect to a Mortgage Loan, any payment of
principal received in any month during a Due Period as part of a payment which
is neither intended to satisfy the Mortgage Loan in full nor to cure a
delinquency.
CUSTODIAL AGREEMENT: The agreement for the retention of the Mortgage
Files initially in the form attached hereto as EXHIBIT N.
CUSTODIAN: Initially, with respect to all Mortgage Loans, Bank One
Trust Company, N. A., and thereafter, any successor custodian approved by the
Certificate Insurer and appointed pursuant to the Custodial Agreement, which is
not affiliated with the Servicer, the Representative, the Depositors or the
Originators.
CUT-OFF DATE: August 1, 1999.
DEFAULT: Any occurrence that is, or with notice or the lapse of time
or both would become, a Servicer Default under SECTION 10.01 hereof.
DEFINITIVE CERTIFICATES: As set forth in Section 4.01 hereof.
DELETED MORTGAGE LOAN: A Mortgage Loan replaced by or to be replaced
by a Qualified Substitute Mortgage Loan.
DEPOSITOR: Either EQCC Asset Backed Corporation or EQCC Receivables
Corporation, each of which is a direct or an indirect wholly-owned subsidiary of
the Representative.
DEPOSITORY: Initially, The Depository Trust Company, the nominee of
which is Cede & Co., as the registered Holder of the Book Entry Certificates.
The Depository shall at all times constitute a "clearing corporation" as defined
in Section 8-102(3) of the Uniform Commercial Code of the State of New York.
DEPOSITORY PARTICIPANT: A broker, dealer, bank or other financial
institution or other Person for whom from time to time a Depository effects
book-entry transfers and pledges of securities deposited with the Depository.
DESTROYED MORTGAGE NOTE: A Mortgage Note the original of which was
permanently lost or destroyed and has not been replaced.
DESTROYED MORTGAGE NOTE AFFIDAVIT: An affidavit in the form of
EXHIBIT U delivered pursuant to Section 2.04(a)(i)(B) with respect to a
Destroyed Mortgage Note.
DETERMINATION DATE: With respect to each Distribution Date, the
fifth Business Day prior to such Distribution Date.
DISQUALIFIED NON-UNITED STATES PERSON: A transferee of a Class R-I,
Class R-II, Class R-III or Class R-IV Certificate other than a person that (i)
is a United States Person or (ii) is a Non-United States Person that holds a
Class R-I, Class R-II, Class R-III or Class R-IV Certificate in connection with
the conduct of a trade or business within the United States and has furnished
the transferor and the Trustee with an effective Internal Revenue Service Form
4224 (or successor form) or (iii) is a Non-United States Person that has
delivered to both the transferor and the Trustee an opinion of a nationally
recognized tax counsel to the effect that the transfer of such Class R-I, Class
R-II, Class R-III or Class R-IV Certificate to it is in accordance with the
requirements of the Code and the regulations promulgated thereunder and that
such transfer of a Class R-I, Class R-II, Class R-III or Class R-IV Certificate
will not be disregarded for federal income tax purposes.
DISQUALIFIED ORGANIZATION: Either (i) the United States, (ii) any
state or political subdivision thereof, (iii) any foreign government, (iv) any
international organization, (v) any agency or instrumentality of any of the
foregoing, (vi) any tax-exempt 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, (vii) any organization described in Section 1381(a)(2)(C) of the
Code, or (viii) any other entity designated as a Disqualified Organization by
relevant legislation amending the REMIC Provisions and in effect at or proposed
to be effective as of the time of the determination. Notwithstanding the
foregoing, a corporation will not be treated as an instrumentality of the United
States or of any state or political subdivision thereof if all of its activities
are subject to tax and a majority of its board of directors is not selected by
such governmental unit. The terms "United States and "international
organization" shall have the meanings set forth in Section 7701 of the Code.
DISTRIBUTION DATE: The 25th day of any month, or if such 25th day is
not a Business Day, the first Business Day immediately following, commencing on
September 27, 1999.
DUE DATE: The day of the month on which the Monthly Payment is due
from the Mortgagor on a Mortgage Loan.
DUE PERIOD: With respect to any Distribution Date, the calendar
month immediately preceding the calendar month in which such Distribution Date
occurs.
ELIGIBLE ACCOUNT: Either (A) a segregated account or segregated
accounts maintained with an institution whose deposits are insured by the Bank
Insurance Fund or the Savings Association Insurance Fund of the FDIC, (x) the
unsecured and uncollateralized debt obligations of which shall be rated "A" or
better by S&P or have the highest short-term rating by S&P and (y) the unsecured
and uncollateralized debt obligations of which shall be rated "A-1 or better by
Moody's and have the highest short-term rating by Moody's and which is either
(i) a federal savings and loan association duly organized, validly existing and
in good standing under the federal banking laws, (ii) an institution duly
organized, validly existing and in good standing under the applicable banking
laws of any state, (iii) a national banking association duly organized, validly
existing and in good standing under the federal banking laws, (iv) a principal
subsidiary of a bank holding company, or (v) approved in writing by the
Certificate Insurer, S&P and Moody's or (B) a segregated trust account or
accounts maintained with the corporate trust department of a federal or state
chartered depository institution or trust company, having capital and surplus of
not less than $50,000,000, acting in its fiduciary capacity, and has a rating
from Moody's and S&P for long-term deposits of at least "Baa3" and "BBB,"
respectively. Any Eligible Accounts maintained with the Trustee shall conform to
the preceding clause (B).
EQUICREDIT: EquiCredit Corporation of America.
EVENT OF NONPAYMENT: An event of nonpayment shall occur with respect
to any Distribution Date if the amount remitted by the Servicer pursuant to
SECTIONS 5.04(I), 6.04(E) AND 6.08 and on deposit in the Collection Account for
such Distribution Date, plus any amounts on deposit in the Collection Account,
that are not subject to any automatic stay under Section 362 of the United
States Bankruptcy Code pursuant to an order of a United States bankruptcy court
of competent jurisdiction, will not, taken together, be sufficient to pay the
sum of (x) the Class A Interest Remittance Amount and (y) the amount to be
withdrawn from the Collection Account pursuant to priority first of SECTIONS
6.05(D)(I), 6.05(D)(II) and 6.05(D)(III) in respect of such Distribution Date,
unless such insufficiency results from a failure by the Certificate Insurer to
perform in accordance with the terms of this Agreement or the Certificate
Insurance Policy or a failure by the Trustee to perform in accordance with this
Agreement.
EXCESS PROCEEDS: With respect to any Liquidated Mortgage Loan, the
excess, if any, of (a) the Net Liquidation Proceeds received in respect thereof
over (b) the Principal Balance of such Mortgage Loan as of the date such
Mortgage Loan became a Liquidated Mortgage Loan plus accrued but unpaid interest
thereon at the Mortgage Interest Rate.
EXCESS SPREAD: Each of the Fixed Rate Group 1 Excess Spread, the
Fixed Rate Group 2 Excess Spread and the Adjustable Rate Group Excess Spread.
EXCHANGE ACT: The Securities Exchange Act of 1934, as amended.
EXTRA PRINCIPAL DISTRIBUTION AMOUNT: With respect to a Certificate
Group and any Distribution Date, the lesser of (i) the related General Excess
Available Amount for such Distribution Date and (ii) the related
Overcollateralization Deficiency Amount for such Distribution Date.
FDIC: The Federal Deposit Insurance Corporation and any successor
thereto.
FHLMC: The Federal Home Loan Mortgage Corporation and any successor
thereto.
FIDELITY BOND: As described in Section 5.09.
FINAL SCHEDULED DISTRIBUTION DATE: With respect to each Class of
Certificates, as specified in the table under the Preliminary Statement.
FIRST LIEN: With respect to any Mortgage Loan secured by a second
priority lien, the mortgage loan relating to the corresponding Mortgaged
Property secured by a first priority lien.
FIXED RATE CERTIFICATEHOLDER: A Holder of a Fixed Rate Certificate.
FIXED RATE CERTIFICATES: The Class A-1F Certificates, Class A-2F
Certificates, Class A-3F Certificates, Class A-4F Certificates, Class A-5F
Certificates, Class A-6F Certificates and Class A-7F Certificates.
FIXED RATE CLASS X COMPONENTS: The Class X-1F, Class X-2F, Class
X-3F, Class X-4F, Class X-5F, Class X-6F and Class X-7F Components and clauses
(i) and (ii) of the definition of Class X-E Component.
FIXED RATE GROUP 1: The group of Mortgage Loans indicated on the
Mortgage Loan Schedule as belonging to Fixed Rate Group 1.
FIXED RATE GROUP 1 AGGREGATE INTEREST REMITTANCE AMOUNT: For any
Distribution Date, the sum of Fixed Rate Group 1 Interest Remittance Amounts for
each Class of Fixed Rate Group 1 Certificates.
FIXED RATE GROUP 1 AVAILABLE FUNDS: For any Distribution Date, the
Available Funds with respect to Fixed Rate Group 1.
FIXED RATE GROUP 1 BASIC PRINCIPAL DISTRIBUTION AMOUNT: As to any
Distribution Date, the lesser of (A) the Fixed Rate Group 1 Principal Balance as
of such Distribution Date and (B) the excess of (a) the Principal Remittance
Amount for Fixed Rate Group 1 for such Distribution Date over (b) the
Overcollateralization Release Amount, if any, for the Fixed Rate Group 1
Certificates for such Distribution Date.
FIXED RATE GROUP 1 CERTIFICATES: The Class A-1F, Class A-2F, Class
A-3F, Class A-4F, Class A-5F and Class A-6F Certificates.
FIXED RATE GROUP 1 COMPONENT REMITTANCE AMOUNTS: The Class X-1F
Component Remittance Amount, the Class X-2F Component Remittance Amount, the
Class X-3F Component Remittance Amount, the Class X-4F Component Remittance
Amount, the Class X-5F Component Remittance Amount, the Class X-6F Component
Remittance Amount and clause (i) of the definition of Class X-E Component
Remittance Amount.
FIXED RATE GROUP 1 EXCESS SPREAD: With respect to any Distribution
Date, the sum of (A) the excess (if any) of (a) the aggregate interest received
or advanced, pursuant to SECTION 6.08, for the related Due Period, on the
Mortgage Loans in Fixed Rate Group 1 at their respective Mortgage Interest
Rates, over (b) the sum of (i) interest accrued on the Fixed Rate Group 1
Certificates since the immediately prior Distribution Date, (ii) the product of
(x) 1/12th of the applicable Administrative Fee Rate and (y) the aggregate of
the principal balances of the Mortgage Loans in Fixed Rate Group 1 on which
interest for such Due Period was calculated.
FIXED RATE GROUP 1 INTEREST CARRYOVER: For any Class of Fixed Rate
Group 1 Certificates, an amount, calculated on any Distribution Date on which
the Fixed Rate Group 1 Pass-Through Rate for such Fixed Rate Group 1
Certificates is equal to the Fixed Rate Group 1 Net Funds Cap Rate, equal to (i)
the difference between (a) the amount of interest such Fixed Rate Group 1
Certificates would be entitled to receive on such Distribution Date without
regard to the Fixed Rate Group 1 Net Funds Cap Rate and (b) the amount of
interest actually distributed to such Fixed Rate Group 1 Certificates on such
Distribution Date, plus (ii) the portion of any amount calculated pursuant to
clause (i) remaining unpaid from prior Distribution Dates and interest accrued
thereon at the then-applicable Fixed Rate Group 1 Pass-Through Rate (calculated
without regard to the Fixed Rate Group 1 Net Funds Cap Rate).
FIXED RATE GROUP 1 INTEREST REMITTANCE AMOUNT: For any Distribution
Date and any Class of Fixed Rate Group 1 Certificate, interest accrued during
the related Accrual Period at the related Fixed Rate Group 1 Pass-Through Rate
on the principal balance of such Class of Fixed Rate Group 1 Certificates
outstanding during such Accrual Period (after giving effect to distributions of
principal made on the preceding Distribution Date) calculated on the basis of a
30 day month over a 360 day year.
FIXED RATE GROUP 1 NET FUNDS CAP RATE: With respect to any Accrual
Period, a per annum rate equal to the Fixed Rate Group 1 Weighted Average
Mortgage Interest Rate as of the first day of the related Due Period less the
applicable Administrative Fee Rate.
FIXED RATE GROUP 1 PASS-THROUGH RATE: Each of the Class A-1F
Pass-Through Rate, Class A-2F Pass-Through Rate, Class A-3F Pass-Through Rate,
Class A-4F Pass-Through Rate, Class A-5F Pass-Through Rate and Class A-6F
Pass-Through Rate.
FIXED RATE GROUP 1 PRINCIPAL BALANCE: As of any date of
determination, the sum of the Class A-1F Principal Balance, the Class A-2F
Principal Balance, the Class A-3F Principal Balance, the Class A-4F Principal
Balance, the Class A-5F Principal Balance and the Class A-6F Principal
Balance.
FIXED RATE GROUP 1 WEIGHTED AVERAGE MORTGAGE INTEREST RATE: As of
any date, the weighted average of the Mortgage Interest Rates on the Mortgage
Loans in Fixed Rate Group 1.
FIXED RATE GROUP 2: The group of Mortgage Loans indicated on the
Mortgage Loan Schedule as belonging to Fixed Rate Group 2.
FIXED RATE GROUP 2 AVAILABLE FUNDS: For any Distribution Date, the
Available Funds with respect to Fixed Rate Group 2.
FIXED RATE GROUP 2 BASIC PRINCIPAL DISTRIBUTION AMOUNT: As to any
Distribution Date, the lesser of (A) the Class A-7F Principal Balance as of such
Distribution Date and (B) the excess of (a) the Principal Remittance Amount for
Fixed Rate Group 2 for such Distribution Date over (b) the Overcollateralization
Release Amount, if any, for the Fixed Rate Group 2 Certificates for such
Distribution Date.
FIXED RATE GROUP 2 CERTIFICATES: The Class A-7F Certificates.
FIXED RATE GROUP 2 COMPONENT REMITTANCE AMOUNT: The Class X-7F
Component Remittance Amount and clause (ii) of the definition of Class X-E
Component Remittance Amount.
FIXED RATE GROUP 2 EXCESS SPREAD: With respect to any Distribution
Date, the sum of (A) the excess (if any) of (a) the aggregate interest received
or advanced, pursuant to SECTION 6.08, for the related Due Period, on the
Mortgage Loans in Fixed Rate Group 2 at their respective Mortgage Interest
Rates, over (b) the sum of (i) interest accrued on the Fixed Rate Group 2
Certificates since the immediately prior Distribution Date, (ii) the product of
(x) 1/12th of the applicable Administrative Fee Rate and (y) the aggregate of
the principal balances of the Mortgage Loans in Fixed Rate Group 2 on which
interest for such Due Period was calculated.
FIXED RATE GROUP 2 INTEREST CARRYOVER: An amount, calculated on any
Distribution Date on which the Fixed Rate Group 2 Pass-Through Rate is equal to
the Fixed Rate Group 2 Net Funds Cap Rate, equal to (i) the difference between
(a) the amount of interest the Fixed Rate Group 2 Certificates would be entitled
to receive on such Distribution Date without regard to the Fixed Rate Group 2
Net Funds Cap Rate and (b) the amount of interest actually distributed to the
Fixed Rate Group 2 Certificates on such Distribution Date, plus (ii) the portion
of any amount calculated pursuant to clause (i) remaining unpaid from prior
Distribution Dates and interest accrued thereon at the then-applicable Class A-7
Pass-Through Rate (calculated without regard to the Fixed Rate Group 2 Net Funds
Cap Rate).
FIXED RATE GROUP 2 INTEREST REMITTANCE AMOUNT: For any Distribution
Date and the Fixed Rate Group 2 Certificates, interest accrued during the
related Accrual Period at the related Fixed Rate Group 2 Pass-Through Rate on
the principal balance of such Fixed Rate Group 2 Certificates outstanding during
such Accrual Period (after giving effect to distributions of principal made on
the preceding Distribution Date) calculated on the basis of a 30 day month over
a 360 day year.
FIXED RATE GROUP 2 NET FUNDS CAP RATE: With respect to any Accrual
Period, a per annum rate equal to the Fixed Rate Group 2 Weighted Average
Mortgage Interest Rate as of the first day of the related Due Period less the
applicable Administrative Fee Rate.
FIXED RATE GROUP 2 WEIGHTED AVERAGE MORTGAGE INTEREST RATE: As of
any date, the weighted average of the Mortgage Interest Rates on the Mortgage
Loans in Fixed Rate Group 2.
FIXED RATE INTEREST CARRYOVER: Each of the Fixed Rate Group 1
Interest Carryover and the Fixed Rate Group 2 Interest Carryover.
FNMA: Fannie Mae and any successor thereto.
GENERAL EXCESS AVAILABLE AMOUNT: With respect to a Certificate Group
and each Distribution Date, the amount, if any, by which the related Available
Funds for such Distribution Date exceeds the aggregate amount distributed on
such Distribution Date pursuant to priorities first through seventh of Section
6.05(d)(i), 6.05(d)(ii) or 6.05(iii), as applicable.
GROUP 1 OC AMOUNT: The amount, if any, by which the Pool Principal
Balance of the Fixed Rate Group 1 Mortgage Loans exceeds the aggregate principal
balance of Fixed Rate Group 1 Certificates.
GROUP 2 OC AMOUNT: The amount, if any, by which the Pool Principal
Balance of the Fixed Rate Group 2 Mortgage Loans exceeds the principal balance
of the Class A-7F Certificates.
GROUP A-1A OC AMOUNT: The amount, if any, by which the Pool
Principal Balance of the Adjustable Rate Group Mortgage Loans exceeds the
principal balance of the Class A-1A Certificates.
HOLDER: A Certificateholder.
ILLINOIS LAND TRUST: A trust formed under a trust agreement between
the trustee and one or more beneficiaries named therein, pursuant to which such
trustee holds legal and equitable title to a Mortgaged Property located in the
State of Illinois and such beneficiaries are the owners of the beneficial
interest in such trust.
INDEPENDENT: When used with respect to any specified Person, that
the Person (i) does not have any direct financial interest or any material
indirect financial interest in the Depositors, the Representative, the Servicer,
the Originators or any Affiliate of any of the foregoing Persons and (ii) is not
connected with the Representative, the Servicer, the Originators or any
Affiliate of any of the foregoing Persons as an officer, employee, promoter,
underwriter, trustee, partner, director or person performing similar functions.
INITIAL PREMIUM FEE RECOVERY AMOUNT: With respect to any
Distribution Date, the product of (i) 1/12th of 0.105% and (ii) the excess of
(A) the sum of the Fixed Rate Group 1 Principal Balance, the Class A-7F
Principal Balance and the Class A-1A Principal Balance immediately prior to
giving effect to distributions of principal and interest on the Certificates
over (B) the sum of the Fixed Rate Group 1 Principal Balance, the Class A-7F
Principal Balance and the Class A-1A Principal Balance immediately after giving
effect to distributions of principal and interest on the Certificates.
INSURANCE ACCOUNT: The insurance account established and maintained
by the Trustee in accordance with SECTION 6.03 hereof.
INSURANCE PROCEEDS: Proceeds paid to the Trustee or the Servicer by
any insurer (except the Certificate Insurer) or by the Servicer pursuant to a
deductible clause under a blanket policy insuring against fire and hazards of
extended coverage on all of the Mortgage Loans pursuant to SECTION 5.08, in
either event pursuant to any insurance policy covering a Mortgage Loan,
Mortgaged Property, or REO Property or any other insurance policy net of any
expenses which are incurred by the Servicer or the Trustee in connection with
the collection of such proceeds and not otherwise reimbursed to the Servicer,
other than proceeds to be applied to the restoration or repair of the Mortgaged
Property or released to the Mortgagor in accordance with customary second
mortgage servicing procedures.
INSURED PAYMENT: As to each Distribution Date the sum of (i) any
shortfall in amounts available in the Collection Account to pay the Class A
Interest Remittance Amount for such Distribution Date, (ii) the excess, if any,
of (a) the sum of the Certificate Balances of each Certificate Group then
outstanding, after giving effect to distributions on that Distribution Date,
over (b) the aggregate Principal Balance of the Mortgage Loans then outstanding,
(iii) without duplication of the amount specified in clause (ii), the
Certificate Balance of each Class of Class A Certificates which remains unpaid
on the Final Scheduled Distribution Date for such Class, after giving effect to
distributions on that Distribution Date, or the earlier termination of the Trust
and (iv) any Preference Amount for any given Business Day in accordance with the
terms of the Certificate Insurance Policy.
INTEREST CARRYOVER: Each of the Fixed Rate Group 1 Interest
Carryover, the Fixed Rate Group 2 Interest Carryover and the Class A-1A Interest
Carryover.
LATEST MATURITY DATE: With respect to any Class of Certificates, its
Final Scheduled Distribution Date.
LIBOR: For any Accrual Period and the Class A-1A Certificates, the
London interbank offered rate for one-month United States dollar deposits
determined by the Trustee for each Accrual Period in accordance with the
provisions of SECTION 4.05.
LIBOR BUSINESS DAY: Any Business Day on which banks are open for
dealing in foreign currency and exchange in London, England, the City of New
York and Chicago, Illinois.
LIBOR DETERMINATION DATE: With respect to any Accrual Period, the
second LIBOR Business Day preceding such Accrual Period (which date for the
initial Accrual Period shall be August 24, 1999).
LIEN: Any security interest, lien, charge, pledge, equity or
encumbrance of any kind other than tax liens, mechanics' liens and any liens
that attach by operation of law.
LIQUIDATED MORTGAGE LOAN: Any defaulted Mortgage Loan or REO
Property as to which the Servicer has determined that all amounts which it
reasonably and in good faith expects to recover have been recovered from or on
account of such Mortgage Loan.
LIQUIDATION PROCEEDS: Cash, including Insurance Proceeds, proceeds
of any REO Disposition, amounts required to be deposited in the Principal and
Interest Account pursuant to SECTION 5.10 hereof, and any other amounts received
in connection with the liquidation of defaulted Mortgage Loans, whether through
trustee's sale, foreclosure sale or otherwise.
LOCKOUT PERCENTAGE: For any Distribution Date, the percentage that
corresponds to the range of Distribution Dates in which such Distribution Date
is included, as set forth in the following table:
DISTRIBUTION DATES LOCKOUT PERCENTAGE
- ------------------ ------------------
September 1999 - August 2002 0%
September 2002 - August 2004 45%
September 2004 - August 2005 80%
September 2005 - August 2006 100%
September 2006 and thereafter 300%
LOCKOUT PRO RATA REMITTANCE AMOUNT: For any Distribution Date, an
amount, determined immediately prior to giving effect to any payment of
principal of the Fixed Rate Group 1 Certificates on such date, equal to the
product of (x) a fraction, the numerator of which is the principal balance of
the Class A-6F Certificates as of such Distribution Date and the denominator of
which is the Fixed Rate Group 1 Principal Balance as of such Distribution Date,
and (y) the Fixed Rate Group 1 Principal Distribution Amount for such
Distribution Date.
LOCKOUT REMITTANCE AMOUNT: For any Distribution Date, an amount,
determined immediately prior to giving effect to any payment of principal of the
Fixed Rate Group 1 Certificates on such date, equal to the least of: (a) the
product of (i) the applicable Lockout Percentage for such Distribution Date and
(ii) the Lockout Pro Rata Remittance Amount for such Distribution Date, (b) the
Fixed Rate Group 1 Principal Distribution Amount for such Distribution Date and
(c) the Class A-6F Certificate Principal Balance as of such Distribution Date.
MAJORITY IN AGGREGATE VOTING INTEREST: Class A and Class X
Certificateholders representing Class A and Class X Certificates voting together
as a single class evidencing an aggregate Voting Interest of at least 51% when
expressed as a percentage rounded to four decimal places.
MONTHLY EXCESS SPREAD AMOUNT: With respect to any Distribution Date
and each Certificate Group, the amount equal to the product of 100% and the
amount of the related Excess Spread as of such Distribution Date; provided,
HOWEVER, that the percentage set forth above may be reduced at any time, solely
at the discretion of the Certificate Insurer, at which time written notice shall
be sent to the Representative, the Trustee, S&P and Moody's.
MONTHLY PAYMENT: The scheduled monthly payment of principal
and/or interest required to be made by a Mortgagor on the related Mortgage
Loan, as set forth in the related Mortgage Note.
MONTHLY PREMIUM: The monthly premium payable to the Certificate
Insurer pursuant to the Certificate Insurance Policy and the letter agreement
dated as of the Closing Date, among the Certificate Insurer and the Depositors.
MOODY'S: Moody's Investors Service, Inc., or any successor thereto.
MORTGAGE: The mortgage, deed of trust or other instrument creating a
first or second lien on the Mortgaged Property.
MORTGAGE FILE: As described in Exhibit A.
MORTGAGE IMPAIRMENT INSURANCE POLICY: As defined in Section 5.08.
MORTGAGE INTEREST RATE: With respect to a Mortgage Loan in Fixed
Rate Group 1 or Fixed Rate Group 2, the fixed per annum rate of interest borne
by a Mortgage Note, as shown on the applicable Mortgage Loan Schedule, and with
respect to a Mortgage Loan in the Adjustable Rate Group and any date of
determination, the per annum rate of interest for the related Due Period
computed in accordance with the related Mortgage Note, subject to any minimum
rate, maximum rate and periodic cap on such rate applicable from time to time to
the calculation of interest thereon as set forth in the related Mortgage Note.
MORTGAGE LOAN: An individual mortgage loan which is assigned and
transferred to the Trustee pursuant to this Agreement, together with the rights
and obligations of a holder thereof and payments thereon and proceeds therefrom,
the Mortgage Loans originally subject to this Agreement being identified on the
Mortgage Loan Schedules annexed hereto as EXHIBIT D. Any mortgage loan which,
although intended by the parties hereto to have been, and which purportedly was,
transferred and assigned to the Trustee by the applicable Depositor, in fact was
not transferred and assigned to the Trustee for any reason whatsoever,
including, without limitation, the incorrectness of the statement set forth in
SECTION 3.02(G) hereof with respect to such mortgage loan, shall nevertheless be
considered a "Mortgage Loan" for all purposes of this Agreement. As applicable,
Mortgage Loan shall be deemed to refer to the related REO Property.
MORTGAGE LOAN GROUP: Either Fixed Rate Group 1, Fixed Rate Group 2
or the Adjustable Rate Group.
MORTGAGE LOAN LOSSES: With respect to any Distribution Date, the sum
of the following amounts for each Mortgage Loan that became a Liquidated
Mortgage Loan during the related Due Period: the amount, if any, by which (i)
the sum of (A) the Principal Balance of such Mortgage Loan (determined
immediately before such Mortgage Loan became a Liquidated Mortgage Loan) and (B)
accrued and unpaid interest thereon at the Mortgage Interest Rate to the date on
which such Mortgage Loan became a Liquidated Mortgage Loan exceeds (ii) the Net
Liquidation Proceeds received during such Due Period in connection with the
liquidation of such Mortgage Loan which have not theretofore been used to reduce
the Principal Balance of such Mortgage Loan. For purposes of this definition, a
Mortgage Loan as to which the related Mortgaged Property is held by the Trust
Fund shall be deemed to have continued to accrue interest at the related
Mortgage Interest Rate.
MORTGAGE LOAN SCHEDULE: The schedule of Mortgage Loans in Fixed Rate
Group 1, the schedule of Mortgage Loans in Fixed Rate Group 2 and the schedule
of Mortgage Loans in the Adjustable Rate Group, each attached hereto as EXHIBIT
D as each may be amended to reflect Qualified Substitute Mortgage Loans, such
schedule identifying each applicable Mortgage Loan by address of the Mortgaged
Property and the name of the Mortgagor and setting forth as to each such
Mortgage Loan the following information: (i) the Principal Balance as of the
Cut-off Date, (ii) the account number, (iii) the original principal amount, (iv)
the CLTV as of the date of the origination of the related Mortgage Loan, (v) the
Due Date, (vi) the Mortgage Interest Rate, (vii) the first date on which a
Monthly Payment is due under the Mortgage Note, (viii) the Monthly Payment, (ix)
the original stated maturity date of the Mortgage Note, (x) the remaining number
of months to maturity as of the Cut-off Date and (xi) the Mortgaged Property
State.
MORTGAGE NOTE: The note or other evidence of indebtedness evidencing
the indebtedness of a Mortgagor under a Mortgage Loan.
MORTGAGE POOL: The Mortgage Loans indicated on the Mortgage Loan
Schedule.
MORTGAGED PROPERTY: The underlying property securing a Mortgage
Loan, consisting of a fee simple estate or, with respect to certain properties
located in Maryland, a leasehold estate, in a single parcel of land improved by
a Residential Dwelling.
MORTGAGED PROPERTY STATE: The state in which the Mortgaged
Property related to a Mortgage Loan is located, as set forth on the Mortgage
Loan Schedule.
MORTGAGOR: The obligor on a Mortgage Note.
NET ADJUSTABLE RATE GROUP WEIGHTED AVERAGE MORTGAGE INTEREST Rate:
With respect to any Accrual Period, a rate equal to the Adjustable Group
Weighted Average Mortgage Interest Rate as of the first day of the related Due
Period less the applicable Administrative Fee Rate.
NET FIXED RATE GROUP 1 WEIGHTED AVERAGE MORTGAGE INTEREST RATE: With
respect to any Accrual Period, a rate equal to the Fixed Rate Group 1 Weighted
Average Mortgage Interest Rate as of the first day of the related Due Period
less the applicable Administrative Fee Rate.
NET FIXED RATE GROUP 2 WEIGHTED AVERAGE MORTGAGE INTEREST RATE: With
respect to any Accrual Period, a rate equal to the Fixed Rate Group 2 Weighted
Average Mortgage Interest Rate as of the first day of the related Due Period
less the applicable Administrative Fee Rate.
NET LIQUIDATION PROCEEDS: Liquidation Proceeds net of any
reimbursements to the Servicer made therefrom pursuant to SECTION 5.04(II).
NONDISQUALIFICATION OPINION: An Independent Opinion of Counsel
addressed to the Trustee that a contemplated action will neither cause any Trust
REMIC to fail to qualify as a REMIC at any time the Class A Certificates are
outstanding nor cause an unindemnified "prohibited transaction" or a "prohibited
contribution" tax to be imposed on any Trust REMIC.
NONRECOVERABLE ADVANCES: With respect to any Mortgage Loan, (i) any
Servicing Advance or Advance previously made and not reimbursed pursuant to
SECTION 5.04(II), or (ii) a Servicing Advance proposed to be made, in respect of
any Mortgage Loan or REO Property which, in the good faith business judgment of
the Servicer would not be ultimately recoverable from late collections,
Insurance Proceeds or Liquidation Proceeds on such Mortgage Loan or REO Property
or otherwise.
NON-UNITED STATES PERSON: Any Person other than a United States
Person.
OFFICER'S CERTIFICATE: A certificate delivered hereunder or under
any other Basic Document signed by the President or a Vice President or an
Assistant Vice President of the Representative, a Depositor, the Trustee or the
Servicer, as required hereunder or thereunder.
OPINION OF COUNSEL: A written opinion of counsel delivered hereunder
or under any Basic Document, reasonably acceptable to the Trustee, and
experienced in matters relating to the subject of such opinion; except that any
opinion of counsel relating to (a) the qualification of any Trust REMIC as a
REMIC or (b) compliance with the REMIC Provisions must be an opinion of counsel
who (i) is in fact Independent of the Representative and the Servicer, (ii) does
not have any direct financial interest or any material indirect financial
interest in the Representative or the Servicer or in an affiliate thereof and
(iii) is not connected with the Representative or Servicer as an officer,
employee, director or person performing similar functions.
OPTIONAL PURCHASE DATE: As defined in Section 11.01.
ORIGINAL CLASS A-1A PRINCIPAL BALANCE: $37,812,197.
ORIGINAL CLASS A-1F PRINCIPAL BALANCE: $350,000,000.
ORIGINAL CLASS A-2F PRINCIPAL BALANCE: $137,000,000.
ORIGINAL CLASS A-3F PRINCIPAL BALANCE: $160,000,000.
ORIGINAL CLASS A-4F PRINCIPAL BALANCE: $80,000,000.
ORIGINAL CLASS A-5F PRINCIPAL BALANCE: $27,796,013.
ORIGINAL CLASS A-6F PRINCIPAL BALANCE: $133,000,000.
ORIGINAL CLASS A-7F PRINCIPAL BALANCE: $74,391,790.
ORIGINAL POOL PRINCIPAL BALANCE: The Pool Principal Balance as of
the Cut-off Date, which amount is equal to $1,000,000,143.63.
ORIGINATOR: Any of the entities listed on EXHIBIT K hereto, each of
which is an "Originator" pursuant to the Transfer Agreement and, other than
EquiCredit, is (i) a direct wholly-owned subsidiary of the Representative, and
(ii) a Subservicer as of the date hereof with respect to the Mortgage Loans sold
by it to either Depositor pursuant to the Transfer Agreement.
OVERCOLLATERALIZATION DEFICIENCY AMOUNT: With respect to any
Distribution Date and each Certificate Group equals the amount, if any, by which
the related Overcollateralization Target Amount exceeds the related
Overcollateralized Amount on such Distribution Date (after giving effect to
distributions in respect of the related Principal Distribution Amount on such
Distribution Date).
OVERCOLLATERALIZATION RELEASE AMOUNT: With respect to each
Certificate Group and any Distribution Date (A) prior to the
Overcollateralization Stepdown Date, zero, and (B) on or after the related
Overcollateralization Stepdown Date the lesser of (x) the related Principal
Remittance Amount for such Distribution Date and (y) the excess, if any, of (i)
the related Overcollateralized Amount for such Distribution Date (assuming that
100% of the related Principal Remittance Amount is applied as a principal
payment on the related Certificate Group on such Distribution Date) over (ii)
the related Overcollateralization Target Amount for such Distribution Date.
OVERCOLLATERALIZATION STEPDOWN DATE: With respect to each
Certificate Group means the later to occur of (x) the Distribution Date in March
2002 and (y) the first Distribution Date on which the Overcollateralized Amount
equals or exceeds the related Overcollateralization Target Amount for each
Certificate Group.
OVERCOLLATERALIZATION TARGET AMOUNT: With respect to each
Certificate Group and any Distribution Date:
(x) on or prior to the Overcollateralization Stepdown Date, the Base
Overcollateralization Target Amount;
(y) after the Overcollaterization Stepdown Date, the greatest of
(a) the lesser of (A) the Base Overcollateralization Target Amount for such
Certificate Group and (B) the product of (x) 6.00% with respect to the Fixed
Rate Group 1, 10.00% with respect to the Fixed Rate Group 2, and 20.50% with
respect to the Adjustable Rate Group and (y) the related Pool Principal Balance
as of such date; (b) the sum of the Principal Balances of the three largest
Mortgage Loans in the related Mortgage Loan Group as of such date; and (c) two
times the excess of (i) one-half of the Rolling Six Month Average 90 Day
Delinquency for the related Mortgage Loan Group over (ii) the related Projected
Excess Spread for such Certificate Group as of such date.
Notwithstanding the foregoing, the Overcollateralization Target
Amount for any Distribution Date may be reduced by the Certificate Insurer;
provided that such reductions shall not affect the rating assigned by S&P and
Moody's to the Class A Certificates.
OVERCOLLATERALIZED AMOUNT: With respect to any Distribution Date and
each Certificate Group is the amount, if any, by which (i) the Pool Principal
Balance of the related Mortgage Loan Group on the last day of the immediately
preceding Due Period exceeds (ii) the Principal Balance of the Certificates in
the related Certificate Group, as of such Distribution Date after giving effect
to distributions to be made on such Distribution Date.
OWNER-OCCUPIED MORTGAGED PROPERTY: A Residential Dwelling that the
related Mortgagor represented an intent to occupy as such Mortgagor's primary or
secondary residence at the origination of the Mortgage Loan.
OWNERSHIP INTEREST: As to any Certificate, any ownership or security
interest in such Certificate, including any interest in such Certificate as the
Holder thereof and any other interest therein, whether direct or indirect, legal
or beneficial, as owner or as pledgee.
PASS-THROUGH RATE: Either a Fixed Rate Group 1 Pass-Through Rate,
the Class A-7 Pass-Through Rate or the Class A-1A Pass-Through Rate.
PERCENTAGE INTEREST: With respect to a Class A-1F, Class A-2F, Class
A-3F, Class A-4F, Class A-5F, Class A-6F, Class A-7F or Class A-1A Certificate,
the portion of the Certificates evidenced by such Class A-1F, Class A-2F, Class
A-3F, Class A-4F, Class A-5F, Class A-6F, Class A-7F or Class A-1A Certificate,
respectively, expressed as a percentage rounded to four decimal places, equal to
a fraction the numerator of which is the denomination represented by such Class
A-1F, Class A-2F, Class A-3F, Class A-4F, Class A-5F, Class A-6F, Class A-7F or
Class A-1A Certificate, respectively, and the denominator of which is the
Original Class A-1F Principal Balance, Original Class A-2F Principal Balance,
Original Class A-3F Principal Balance, Original Class A-4F Principal Balance,
Original Class A-5F Principal Balance, Original Class A-6F Principal Balance,
Original Class A-7F Principal Balance or Original Class A-1A Principal Balance,
respectively. With respect to a Class X Certificate, Class R-I Certificate,
Class R-II Certificate, Class R-III Certificate or Class R-IV Certificate, the
portion of the Class evidenced thereby as stated on the face of such
Certificate.
PERFORMANCE DEFAULT: The Servicing Default described in CLAUSE (VII)
of SECTION 10.01(A).
PERMITTED INSTRUMENTS: As used herein, Permitted Instruments shall
include the following:
(i)(A) direct general obligations of, or obligations fully and
unconditionally guaranteed as to the timely payment of principal and
interest by, the United States or any agency or instrumentality thereof,
provided such obligations are backed by the full faith and credit of the
United States, and (B) Federal Housing Administration debentures, FHLMC
senior debt obligations, and FNMA senior debt obligations assigned ratings
in at highest long-term rating by S&P and Moody's, but excluding any of
such securities described in clauses (A) and (B) whose terms do not
provide for payment of a fixed dollar amount upon maturity or call for
redemption;
(ii) federal funds, certificates of deposit, time and demand
deposits and banker's acceptances (in each case having maturities of not
more than 365 days) of any bank or trust company incorporated under the
laws of the United States or any state thereof, provided that (A) the
short-term debt obligations of such bank or trust company at the date of
acquisition thereof have been rated "A-1+" or better by S&P (or, if so
consented to by the Certificate Insurer, "A-1" or better by S&P) and (B)
the short-term and long-term debt obligations of such bank or trust
company at the date of acquisition thereof have been rated Prime-1 and
"A1" or better, respectively, by Moody's;
(iii) deposits of any bank or savings and loan association which
has combined capital, surplus and undivided profits of at least
$3,000,000, which deposits are not in excess of the applicable limits
insured by the Bank Insurance Fund or the Savings Association Insurance
Fund of the FDIC, provided that the long-term deposits of such bank or
savings and loan association are rated at least "BBB" by S&P and "Baa3" by
Moody's;
(iv) commercial paper (having original maturities of not more
than 180 days) rated "A-1+" or better by S&P and Prime-1 by Moody's;
(v) investments in money market funds rated "AAAm" or "AAAm-G"
by S&P and "Aaa" by Moody's;
(vi) investments in Permitted Instruments on an overnight basis
in investment accounts maintained at the Trustee; PROVIDED, HOWEVER, that
any such account shall be an Eligible Account; and
(vii) any other obligation or security acceptable to the Rating
Agencies and the Certificate Insurer (as certified by a letter from each
Rating Agency and the Certificate Insurer to the Trustee); PROVIDED, that
no instrument described hereunder shall evidence either the right to
receive (a) only interest with respect to the obligations underlying such
instrument or (b) both principal and interest payments derived from
obligations underlying such instrument and the interest and principal
payments with respect to such instrument provided a yield to maturity at
par greater than 120% of the yield to maturity at par of the underlying
obligations; and PROVIDED, FURTHER, that no instrument described hereunder
may be purchased at a price greater than par if such instrument may be
prepaid or called at a price less than its purchase price prior to stated
maturity; and PROVIDED, FURTHER that no instrument shall be a Permitted
Instrument unless such instrument is a "permitted investment" within the
meaning of Section 860G(a)(5) of the Code.
PERMITTED TRANSFEREE: Any Person other than a Disqualified
Organization or a Disqualified Non-United States Person, or an agent or nominee
acting on behalf of a Disqualified Organization or a Disqualified Non-United
States Person.
PERSON: Any individual, corporation, partnership, joint venture,
association, joint-stock company, trust, national banking association,
unincorporated organization or government or any agency or political subdivision
thereof.
PLAN: A Plan filed by a Mortgagor pursuant to the Bankruptcy Code
(11 U.S.C., Section 1321) and either confirmed or pending confirmation by a
court of competent jurisdiction pursuant to the Bankruptcy Code (11 U.S.C.,
Section 1325), providing for, among other things, the payment of defaulted
Mortgage Loan payments all of which were due prior to, but in no event after,
the effectiveness of the Plan.
POOL FACTOR: As of any date of determination, the Pool Principal
Balance as of such date divided by the Original Pool Principal Balance.
POOL PRINCIPAL BALANCE: With respect to any or all Mortgage Loan
Groups, the aggregate Principal Balances of the related Mortgage Loans, as of
any date of determination.
PREFERENCE AMOUNT: Any payment of principal or interest on a Class A
Certificate which is made to a holder of a Class A Certificate by or on behalf
of the Trustee which has been deemed a preferential transfer and theretofore
recovered from such holder pursuant to the United States Bankruptcy Code in
accordance with a final, nonappealable order of a court of competent
jurisdiction.
PRE-PLAN INTEREST: With respect to a Bankruptcy Loan, accrued but
unpaid interest relating to the period prior to the filing of the related Plan.
PRE-PLAN INTEREST PAYMENTS: With respect to a Bankruptcy Loan,
payments made by a Mortgagor on account of Pre-Plan Interest.
PRINCIPAL AND INTEREST ACCOUNT: The principal and interest account
established and maintained by the Servicer pursuant to SECTION 5.03 hereof.
References herein to any amounts on deposit in the Principal and Interest
Account shall refer only to amounts pertaining to this Agreement.
PRINCIPAL BALANCE: With respect to any Mortgage Loan or related REO
Property, at any date of determination, the principal balance of the Mortgage
Loan outstanding as of such date. The Principal Balance of any REO Property as
of the date on which such REO Property became an REO Property shall be the
Principal Balance of the related Mortgage Loan as of the date referred to in the
preceding sentence, and the Principal Balance of a Mortgage Loan at the time it
becomes a Liquidated Mortgage Loan shall be zero.
PRINCIPAL DISTRIBUTION AMOUNT: With respect to any Certificate Group
and any Distribution Date, the sum of (i) the Basic Principal Distribution
Amount and (ii) the Extra Principal Distribution Amount for such Certificate
Group and Distribution Date.
PRINCIPAL PREPAYMENT: Any payment or other recovery of principal on
a Mortgage Loan equal to the outstanding principal balance thereof, received in
advance of the final scheduled Due Date, that is intended to satisfy a Mortgage
Loan in full.
PRINCIPAL REMITTANCE AMOUNT: With respect to each Mortgage Loan
Group and each Distribution Date, the sum (without duplication) of (i) the
principal portion of all Monthly Payments received by the Servicer or any
Subservicer in the related Due Period, (ii) all Curtailments and all Principal
Prepayments received by the Servicer or any Subservicer during such related Due
Period, (iii) the principal portion of all Insurance Proceeds, Released
Mortgaged Property Proceeds and Net Liquidation Proceeds received by the
Servicer or any Subservicer during the related Due Period, (iv) (A) that portion
of the purchase price (as set forth in SECTION 2.06(B)) of any purchased
Mortgage Loans which represents principal and (B) the principal portion of any
Substitution Adjustments deposited into the Principal and Interest Account as of
the related Determination Date and (v) the Principal Balance of each Mortgage
Loan as of the beginning of the related Due Period which became a Liquidated
Mortgage Loan during the related Due Period (exclusive of any principal payments
in respect thereof included in CLAUSES (I) THROUGH (IV) above).
PROCEEDING: Any suit in equity, action at law or other judicial or
administrative proceeding.
PROJECTED EXCESS SPREAD: With respect to any Distribution Date and
each Certificate Group, six (6) times the amount of the related Monthly Excess
Spread Amount.
PROSPECTUS: The prospectus and the prospectus supplement each dated
August 18, 1999, prepared by the Representative and the Depositors in connection
with the initial issuance and sale of the Class A Certificates.
QUALIFIED SUBSTITUTE MORTGAGE LOAN: A mortgage loan or mortgage
loans substituted for a Deleted Mortgage Loan pursuant to SECTION 2.06 OR 3.03
hereof, which (i) has or have a mortgage interest rate or rates of not less than
(and not more than two percentage points more than) the Mortgage Interest Rate
for the Deleted Mortgage Loan (which, in the case of a Mortgage Loan in the
Adjustable Rate Group, shall mean a Mortgage Loan having the same interest rate
index, and a margin over such index and a maximum interest rate at least equal
to (and in each case not more than two percentage points more than) those
applicable to the related Deleted Mortgage Loan), (ii) relates or relate to the
same type of Residential Dwelling as the Deleted Mortgage Loan, or relates to a
one- to four-family dwelling, and has or have a lien priority that is no more
junior or subordinate than that of the Deleted Mortgage Loan, (iii) matures or
mature no later than (and not more than one year earlier than) the Deleted
Mortgage Loan, (iv) has or have a Combined Loan-to-Value Ratio or Combined
Loan-to-Value Ratios at the time of such substitution no higher than the
Combined Loan-to-Value Ratio of the Deleted Mortgage Loan, (v) has or have a
principal balance or principal balances (after application of all payments
received on or prior to the date of substitution) equal to or less than the
Principal Balance of the Deleted Mortgage Loan as of such date, (vi) is of equal
or better underwriting program class quality (as described in the Prospectus) as
the Deleted Mortgage Loan, (vii) complies or comply as of the date of
substitution with each representation and warranty set forth in SECTIONS 3.01(B)
AND 3.02, (viii) is of the same type, either a balloon loan or fully-amortizing
Mortgage Loan, as the Deleted Mortgage Loan and (ix) would be in the same
Mortgage Loan Group (Fixed Rate Group 1, Fixed Rate Group 2 or Adjustable Rate
Group) as the related Deleted Mortgage Loan.
RATING AGENCIES: Collectively, Moody's and S&P.
REASSIGNMENT OF ASSIGNMENT OF BENEFICIAL INTEREST: With respect to
each Mortgage Loan secured by an interest in an Illinois Land Trust, an
assignment of the Assignment of Beneficial Interest, sufficient under the laws
of the jurisdiction wherein the related Mortgaged Property is located to effect
the transfer of the entire beneficial interest in such Illinois Land Trust to
the Depositors and the sale of such beneficial interest to the Trustee for the
benefit of the Certificateholders.
RECORD DATE: The last day of the calendar month preceding the month
in which each Distribution Date occurs.
RECORDATION TRIGGER: The date on which (i) the long-term senior
unsecured debt of Bank of America Corporation or its successor in interest is
reduced below "A-" by S&P or below "A3" by Moody's or is withdrawn.
REFERENCE BANKS: Barclay's Bank PLC, Chase Manhattan Bank, Citibank,
N.A. and National Westminster Bank PLC; PROVIDED that if any of the foregoing
banks are not suitable to serve as a Reference Bank, then any leading banks
selected by the Trustee which are engaged in transactions in Eurodollar deposits
in the international Eurocurrency market (i) with an established place of
business in London, (ii) not controlling, under the control of or under common
control with any Depositor or any affiliate thereof, (iii) whose quotations
appear on the Telerate LIBOR Page on the relevant Interest Determination Date
and (iv) which have been designated as such by the Trustee.
REGISTERED HOLDER: The Person in whose name a Certificate is
registered on the Certificate Register.
REGULAR INTERESTS: The Class A Certificates and the Class X
Certificates.
REIMBURSABLE AMOUNTS: As of any date of determination, an amount
payable to the Servicer, the Representative or the Depositors with respect to
(i) the Servicing Advances and Advances reimbursable pursuant to SECTION
5.04(II) not previously reimbursed, (ii) any advances reimbursable pursuant to
SECTION 9.01 and not previously reimbursed pursuant to SECTION 6.05(D), and
(iii) any other amounts expressly reimbursable to the Servicer or the Depositors
pursuant to this Agreement.
RELEASED MORTGAGED PROPERTY PROCEEDS: As to any Mortgage Loan,
proceeds received by the Servicer in connection with (a) a taking of an entire
Mortgaged Property by exercise of the power of eminent domain or condemnation or
(b) any release of part of the Mortgaged Property from the lien of the related
Mortgage, whether by partial condemnation, sale or otherwise, which are not
released to the Mortgagor in accordance with applicable law, customary mortgage
servicing procedures and this Agreement.
REMIC: A "real estate mortgage investment conduit" within the
meaning of Section 860D of the Code.
REMIC I: As defined in Section 2.07(a)(1).
REMIC I DISTRIBUTION ACCOUNT: The account established in accordance
with Section 6.01(a) hereof and maintained by the Trustee.
REMIC I REGULAR INTERESTS: The Class LT1, Class LT2, Class LT3,
Class LT4, Class LT5, Class LT6, Class LT7, Class LT8 and Class LT9 Interests.
REMIC II: As defined in Section 2.07(a)(1).
REMIC II GROUP 1 INTEREST RATE: With respect to any Distribution
Date, a rate obtained by dividing (A) the product of (i) 2 times (ii) the Net
Fixed Rate Group 1 Weighted Average Mortgage Interest Rate times (iii) the
principal balance of the Class LT2 Interest by (B) the sum of (x) the principal
balance of the Class LT2 Interest and (y) the principal balance of the Class LT3
Interest, such principal balances being determined before any reductions of
principal balance made on such Distribution Date.
REMIC II GROUP 2 INTEREST RATE: With respect to any Distribution
Date, a rate obtained by dividing (A) the product of (i) 2 times (ii) the Net
Fixed Rate Group 2 Weighted Average Mortgage Interest Rate times (iii) the
principal balance of the Class LT5 Interest by (B) the sum of (x) the principal
balance of the Class LT5 Interest and (y) the principal balance of the Class LT6
Interest, such principal balances being determined before any reductions of
principal balance made on such Distribution Date.
REMIC II GROUP 3 INTEREST RATE: With respect to any Distribution
Date, a rate obtained by dividing (A) the product of (i) 2 times (ii) the Net
Adjustable Rate Weighted Average Mortgage Interest Rate times (iii) the
principal balance of the Class LT8 Interest by (B) the sum of (x) the principal
balance of the Class LT8 Interest and (y) the principal balance of the Class LT9
Interest, such principal balances being determined before any reductions of
principal balance made on such Distribution Date.
REMIC II REGULAR INTERESTS: The Class MT1, Class MT2, Class MT3,
Class MT4, Class MT5, Class MT6, Class MT7, Class MT8, Class MT9, Class MTN1,
Class MTN2, Class MTN3, Class MTN4, Class MTN5, Class MTN6, Class MTN7, Class
MTN8 and Class MTN9 Interests.
REMIC III: As defined in Section 2.07(a)(1).
REMIC III REGULAR INTERESTS: The Class NTA1, Class NTA2, Class NTA3,
Class NTA4, Class NTA5, Class NTA6, Class NTA7, Class NTA-1A, Class NTN1, Class
NTN2 and Class NTN3 Interests.
REMIC IV: As defined in Section 2.07(a)(1).
REMIC IV DISTRIBUTION ACCOUNT: The account established in accordance
with Section 6.01(a) hereof and maintained by the Trustee.
REMIC IV REGULAR INTERESTS: The Class X Interest and the regular
interests in REMIC IV, beneficial ownership of which is evidenced by the Class A
Certificates.
REMIC PROVISIONS: Provisions of the federal income tax law relating
to real estate mortgage investment conduits, which appear at Sections 860A
through 860G of the Code, and related provisions, and temporary and final
Treasury regulations promulgated thereunder, as the foregoing may be in effect
from time to time (or proposed, if proposed to be retroactive).
REMITTANCE REPORT: As defined in Section 6.07.
REO DISPOSITION: The final sale by the Servicer of a Mortgaged
Property acquired by the Servicer in foreclosure or by deed in lieu of
foreclosure. The proceeds of any REO Disposition constitute part of the
definition of Liquidation Proceeds.
REO PROPERTY: As described in Section 5.10.
REPRESENTATIVE: EquiCredit Corporation of America, or its successor
in interest.
REPRESENTATIVE'S YIELD: For each Mortgage Loan, the sum of (i)
prepayment penalties and premiums collected on the Mortgage Loans and (ii) the
Servicing Compensation exclusive of the Servicing Fee. The Representative's
Yield is retained by the Representative and is not part of the assets of the
Trust Fund.
RESIDENTIAL DWELLING: Any of the following: (i) a one- to
four-family dwelling, (ii) a unit in a planned unit development, (iii) a unit in
a condominium development, or (iv) a permanently affixed mobile home or a
permanently affixed manufactured housing unit, as defined in the FNMA Selling
Guide, which does not constitute other than real property under state law
provided that such home or housing would qualify as a single family residence
under Section 25(c)(10) of the Code.
RESIDUAL CERTIFICATE: Any of the Class R-I, Class R-II, Class R-III
and Class R-IV Certificates.
RESPONSIBLE OFFICER: When used with respect to the Trustee, any
officer assigned to the Corporate Trust Division (or any successor thereto) with
direct responsibility for the administration of this Agreement, including any
Vice President, Assistant Vice President, Senior Trust Officer, Trust Officer,
Assistant Trust Officer, any Assistant Secretary, any trust officer or any other
officer of such Trustee customarily performing functions similar to those
performed by any of the above designated officers and to whom, with respect to a
particular matter, such matter is referred because of such officer's knowledge
of and familiarity with the particular subject. When used with respect to the
Representative, a Depositor, an Originator or the Servicer, the President or any
Vice President, Assistant Vice President, or any Secretary or Assistant
Secretary authorized to perform the actions required, including, without
limitation, each Person whose name appears on a list of Responsible Officers
furnished to the Trustee and the Certificate Insurer on the Closing Date, as
such list may be amended from time to time.
ROLLING THREE MONTH AVERAGE 90 DAY DELINQUENCY RATE: With respect to
any Distribution Date, a fraction expressed as a percentage with a numerator
equal to the average of the aggregate Principal Balances of all Mortgage Loans
which are 90 or more days delinquent (including REO Properties) for such
Distribution Date and the two immediately preceding Distribution Dates and a
denominator equal to the average of the aggregate Principal Balances of all
Mortgage Loans for such Distribution Date and the two immediately preceding
Distribution Dates.
ROLLING SIX MONTH AVERAGE 90 DAY DELINQUENCY: With respect to any
Certificate Group and any Distribution Date beginning on the sixth Distribution
Date, the average of the aggregate Principal Balances of all Mortgage Loans in
the related Mortgage Loan Group which are 90 or more days delinquent (including
REO Properties) for such Distribution Date and the five immediately preceding
Distribution Dates.
S&P: Standard & Poor's, or any successor thereto.
SERIES: 1999-3.
SERVICER: EquiCredit Corporation of America or any successor
appointed as herein provided.
SERVICER CUMULATIVE LOSS TRIGGER: With respect to the periods
indicated below, the Distribution Date when the Cumulative Loss Percentage
exceeds the limit indicated below for such period.
DISTRIBUTION DATES CUMULATIVE LOSS PERCENTAGE
------------------ --------------------------
1-12 1.50%
13-24 2.25%
25-36 2.75%
37-48 3.25%
49-60 3.75%
61+ 4.25%
SERVICER DEFAULT: As specified in Section 10.01(a).
SERVICER DELINQUENCY RATE TRIGGER: Any Distribution Date when the
Rolling Three Month Average 90 Day Delinquency Rate exceeds 15%.
SERVICER EMPLOYEES: As defined in Section 5.09.
SERVICING ADVANCES: All reasonable and customary "out-of-pocket"
costs and expenses incurred in the performance by the Servicer of its servicing
obligations which are "unanticipated," within the meaning of Treasury
Regulations Section 1.860G-1(b)(3)(iii), including, but not limited to, the cost
of (i) the preservation, restoration and protection of the Mortgaged Property,
including, without limitation, advances in respect of real estate taxes and
assessments and insurance premiums on fire, hazard and flood insurance policies
and leasehold payments, (ii) any enforcement or judicial proceedings, including
foreclosures, (iii) the management and liquidation of the REO Property, (iv)
compliance with the obligations under SECTIONS 5.02, 5.05 AND 5.07, which
Servicing Advances are reimbursable to the Servicer to the extent provided in
SECTION 5.04(II), and (v) in connection with the liquidation of a Mortgage Loan,
expenditures relating to the purchase or maintenance of the First Lien pursuant
to SECTION 5.13, for all of which costs and expenses the Servicer is entitled to
reimbursement in accordance with this Agreement. Notwithstanding anything herein
to the contrary, no Servicing Advance shall be required to be made hereunder if
such Servicing Advance would, if made, constitute a Nonrecoverable Advance. The
determination by the Servicer that it has made a Nonrecoverable Advance or that
any proposed Servicing Advance, if made, would constitute a Nonrecoverable
Advance, shall be evidenced by an Officer's Certificate delivered to the
Certificate Insurer, the Depositors and the Trustee no later than the Business
Day following such determination.
SERVICING COMPENSATION: The Servicing Fee and other amounts to which
the Servicer is entitled pursuant to Section 7.03.
SERVICING FEE: With respect to any Accrual Period, the amount equal
to one month's interest at the Servicing Fee Rate on the aggregate of the
Principal Balances of the Mortgage Loans (calculated on the basis of 30 days
over a 360 day year). The Servicing Fee is payable solely from the interest
portion of (i) Monthly Payments, (ii) Liquidation Proceeds or (iii) Released
Mortgaged Property Proceeds collected by the Servicer or as otherwise provided
in Section 5.04. The Servicing Fee with respect to each Mortgage Loan shall
accrue on the same principal balance on which interest accrues on such Mortgage
Loan. The Servicing Fee includes any Servicing Fees owed or payable to any
Subservicer.
SERVICING FEE RATE: With respect to any Mortgage Loan and any
Accrual Period, a rate equal to 0.60% per annum.
SERVICING OFFICER: Any officer of the Servicer involved in, or
responsible for, the administration and servicing of the Mortgage Loans whose
name and specimen signature appear on a list of servicing officers furnished to
the Trustee by the Servicer on the Closing Date, as such list may from time to
time be amended.
STARTUP DAY: The day designated as such pursuant to SECTION 2.07
hereof.
SUBSERVICER: Any Person with whom the Servicer has entered into a
Subservicing Agreement and who satisfies any requirements set forth in SECTION
5.01(B) hereof in respect of the qualification of a Subservicer. As of the
Closing Date, the only Subservicers are the Originators (other than EquiCredit
Corporation of America).
SUBSERVICING AGREEMENT: Any agreement between the Servicer and any
Subservicer relating to subservicing and/or administration of certain Mortgage
Loans as provided in SECTION 5.01(B), a copy of which shall be delivered, along
with any modifications thereto, to the Certificate Insurer and the Trustee.
SUBSTITUTION ADJUSTMENT: As to any date on which a substitution
occurs pursuant to SECTION 2.06 OR 3.03, the amount (if any) by which the
aggregate Principal Balances of any Qualified Substitute Mortgage Loans as of
the date of substitution, together with accrued and unpaid interest thereon (but
only to the extent deposited in the Principal and Interest Account and
transferred to the Collection Account), are less than the aggregate of the
Principal Balances (after application of principal payments received on or
before the date of substitution and deposited into the Principal and Interest
Account), together with accrued and unpaid interest thereon to the date of
substitution, of the related Deleted Mortgage Loans plus any unreimbursed
Servicing Advances.
TAX MATTERS PERSON: The Person or Persons appointed from time to
time to act as the "tax matters person" (within the meaning of the REMIC
Provisions) of each of REMIC I, REMIC II, REMIC III and REMIC IV.
TERMINATION PRICE: As defined in Section 11.01.
TESTING DATE: As defined in Section 3.02(fff).
TRANSFER: Any direct or indirect transfer, sale, pledge,
hypothecation or other form of assignment of any Ownership Interest in a
Certificate.
TRANSFER AFFIDAVIT AND AGREEMENT: As defined in Section 4.02(j).
TRANSFER AGREEMENT: The agreement, dated as of August 1, 1999, among
the Originators and the Depositors, pursuant to which the Originators
transferred the Mortgage Loans to the Depositors.
TRANSFEREE: Any Person who is acquiring by Transfer any Ownership
Interest in a Certificate.
TRANSFEROR: Any Person who is disposing by Transfer any Ownership
Interest in a Certificate.
TRUST: EQCC Home Equity Loan Trust 1999-3.
TRUST FUND: The segregated pool of assets subject hereto,
constituting the trust created hereby and to be administered hereunder,
consisting of: (i) such Mortgage Loans as from time to time are subject to this
Agreement, together with the Mortgage Files relating thereto and all proceeds
thereof, (ii) such assets as from time to time are identified as REO Property or
are deposited in the Collection Account, REMIC I Distribution Account, REMIC II
Distribution Account, REMIC III Distribution Account, REMIC IV Distribution
Account, Principal and Interest Account and Insurance Account, including amounts
on deposit in the foregoing accounts and invested in Permitted Instruments,
(iii) the Trustee's rights under all insurance policies with respect to the
Mortgage Loans required to be maintained pursuant to this Agreement and any
Insurance Proceeds, (iv) the Certificate Insurance Policy, (v) Liquidation
Proceeds and (vi) Released Mortgaged Property Proceeds. The Representative's
Yield and amounts received on and after the Cut-off Date in respect of interest
accrued on the Mortgage Loans prior to the Cut-off Date do not constitute part
of the Trust Fund.
TRUST REMIC: As defined in Section 2.07(a)(1).
TRUSTEE: U.S. Bank National Association, not in its individual
capacity but solely as trustee under this Agreement, or its successor in
interest, or any successor trustee appointed pursuant to this Agreement.
UCC: The Uniform Commercial Code as in effect in the relevant
jurisdiction.
UNITED STATES PERSON: (i) A citizen or resident of the United
States, (ii) a corporation or partnership (unless, in the case of a partnership,
Treasury regulations are adopted that provide otherwise) created or organized in
or under the laws of the United States, any state thereof or the District of
Columbia, including an entity treated as a corporation or partnership for
federal income tax purposes, (iii) an estate the income of which is includible
in gross income for United States federal income tax purposes, regardless of its
source or (iv) a trust if a court within the United States is able to exercise
primary supervision over the administration of such trust and one or more United
States Persons have the authority to control all substantial decisions of such
trust (or, to the extent provided in applicable Treasury regulations, certain
trusts in existence on August 20, 1996 which are eligible to be treated as
United States persons).
UNPAID CLASS X REMITTANCE AMOUNT: For any Distribution Date, the
aggregate of the Class X Remittance Amounts for such Distribution Date and all
prior Distribution Dates less amounts previously distributed to the Class X
Certificateholders.
VOTING INTEREST: The aggregate Voting Interests of each Class of
Class A Certificates on any date will be equal to a percentage, expressed as a
fraction, the numerator of which is the principal balance of such Class and the
denominator of which is 95% of the sum of the Fixed Rate Group 1 Principal
Balance, the Class A-7F Principal Balance and the Class A-1A Principal Balance.
The aggregate Voting Interests of the Class X Certificates will be equal to a
percentage, expressed as a fraction, the numerator of which is 5% of the sum of
the Fixed Rate Principal Balance and the Class A-1A Principal Balance and the
denominator of which is the sum of the Fixed Rate Group 1 Principal Balance, the
Class A-7F Principal Balance and the Class A-1A Principal Balance. Each
Certificateholder of a Class will have a Voting Interest equal to the product of
the Voting Interest to which such Class is collectively entitled and the
Percentage Interest in such Class represented by such Holder's Certificates.
<PAGE>
ARTICLE II
CONVEYANCE OF THE TRUST ASSETS
Section 2.01 SALE AND CONVEYANCE OF TRUST ASSETS; PRIORITY
AND SUBORDINATION OF OWNERSHIP INTERESTS.
(a) The Depositors do hereby sell, transfer, assign, set over and
convey to the Trustee (for the benefit of the Certificateholders and the
Certificate Insurer, as their interests may appear) without recourse, all of the
right, title and interest of the Depositors in and to (i) the Mortgage Loans
(excepting the Representative's Yield and amounts received on and after the
Cut-off Date in respect of interest accrued on the Mortgage Loans prior to the
Cut-off Date), (ii) the Mortgage Files relating to the Mortgage Loans, (iii) the
related Mortgaged Properties, (iv) the Depositors' rights under all insurance
policies with respect to the Mortgage Loans required to be maintained by it, (v)
all right, title and interest of the Depositors in, to and under the Transfer
Agreement, including the right to cause the Originators to repurchase the
Mortgage Loans under certain circumstances, (vi) all right, title and interest
of the Depositors in each of the Accounts established and maintained pursuant to
ARTICLES V AND VI and (vii) the interest of the Depositors in any proceeds of
the property described in clauses (i), (ii), (iii), (iv), (v) and (vi),
including all proceeds of the conversion, voluntary or involuntary, of the
foregoing into cash, instruments, securities or other property, including
without limitation, all amounts from time to time held or invested in the
Accounts.
(b) The rights of the Holders and the Certificate Insurer to receive
payments with respect to the Mortgage Loans in respect of the Certificates, and
all ownership interests of the Certificateholders in such payments, shall be as
set forth in this Agreement.
(c) It is the intention of this Agreement that the transfer of the
Depositors' right, title and interest in and to the assets of the Trust pursuant
to this Agreement shall constitute an absolute sale by the Depositors to the
Trustee of the Mortgage Loans for the benefit of the Certificateholders and the
Certificate Insurer and not a loan. If a transfer of Mortgage Loans from an
Originator to a Depositor pursuant to the Transfer Agreement is characterized as
a pledge and not an absolute sale, then such Depositor shall be deemed to have
transferred to the Trustee for the benefit of the Certificateholders and the
Certificate Insurer, as their interests may appear, all of such Depositor's
right, title and interest in, to and under the obligations of such Originator
deemed to be secured by said pledge; and it is the intention of this Agreement
that the Depositors shall also be deemed to have granted and for such purposes
the Depositors hereby grant, to the Trustee for the benefit of the
Certificateholders and the Certificate Insurer, as their interests may appear, a
first priority security interest in all of the Depositors' right, title, and
interest in, to and under the obligations of the Originators to the Depositors
deemed to be secured by said pledge and that the Trustee shall be deemed to be
an independent custodian for purposes of perfection of the security interest
granted to the Depositors. If the transfer of the Mortgage Loans and the other
assets of the Trust from the Depositors to the Trustee for the benefit of the
Certificateholders is characterized as a pledge, it is the intention of this
Agreement that this Agreement shall constitute a security agreement under
applicable law, and that the Depositors shall be deemed to have granted and for
such purposes the Depositors hereby grant, to the Trustee for the benefit of the
Certificateholders and the Certificate Insurer, as their interests may appear, a
first priority security interest in all of the Depositors' right, title and
interest in, to and under the Mortgage Loans, all payments of principal of or
interest on such Mortgage Loans, all other rights relating to and payments made
in respect of the assets of the Trust, and all proceeds of any thereof,
including all proceeds of the conversion, voluntary or involuntary, of the
foregoing into cash, instruments, securities or other property, including
without limitation all amounts from time to time held or invested in the
Accounts. If the trust created by this Agreement terminates prior to the
satisfaction of the claims of any Person in any Certificates, the security
interest created hereby shall continue in full force and effect and the Trustee
shall be deemed to be the collateral agent for the benefit of such Person.
Section 2.02 POSSESSION OF MORTGAGE FILES.
(a) Upon the issuance of the Certificates, the ownership of each
Mortgage Note, the Mortgage and the contents of the related Mortgage File is
vested in the Trustee for the benefit of the Certificateholders.
(b) Pursuant to SECTION 2.04, the Depositors have delivered or
caused to be delivered each Mortgage File to the Custodian.
Section 2.03 BOOKS AND RECORDS.
The sale of each Mortgage Loan shall be reflected on the applicable
Depositor's balance sheets and other financial statements prepared in accordance
with generally accepted accounting principles as a sale of assets by each
Depositor. The applicable Depositor shall be responsible for maintaining, and
shall maintain, a complete set of books and records for each Mortgage Loan which
shall be clearly marked to reflect the ownership of each Mortgage Loan by the
Trustee for the benefit of the Certificateholders.
Section 2.04 DELIVERY OF MORTGAGE LOAN DOCUMENTS.
Contemporaneously with the delivery of this Agreement, the
Depositors delivered or caused to be delivered hereunder to the Trustee the
Certificate Insurance Policy, and each Depositor has delivered to the Trustee
(which may be by delivery to the Custodian on behalf of the Trustee) each of the
following documents for each Mortgage Loan:
(a) (i) (A) The original Mortgage Note, with any intervening
endorsements, endorsed "Pay to the order of U.S. Bank National Association, as
Trustee under the Pooling and Servicing Agreement dated as of August 1, 1999,
without recourse" or in blank and signed, by facsimile or manual signature, in
the name of the Originator that transferred such Mortgage Loan to the applicable
Depositor pursuant to the Transfer Agreement by a Responsible Officer, with all
prior and intervening endorsements showing a complete chain of endorsement from
the originator to such Originator, if the Originator from whom the Depositor
acquired such Mortgage Loan was not the originator or (B) if such Mortgage Note
is a Destroyed Mortgage Note, an original Destroyed Mortgage Note Affidavit
together with a copy of such Mortgage Note attached thereto and, (ii) with
respect to manufactured housing units, the certificate of title, if any;
(b) Either: (i) the original Mortgage, with evidence of recording
thereon (and, in the case of a Mortgage Loan secured by a Mortgaged Property
held in an Illinois Land Trust, signed by the trustee of such Illinois Land
Trust), (ii) a copy of the Mortgage certified as a true copy by a Responsible
Officer of the Originator that transferred such Mortgage Loan to the applicable
Depositor pursuant to the Transfer Agreement (provided, however, that such
Responsible Officer may complete one or more blanket certificates attaching
copies of one or more Mortgages relating thereto) or by the closing attorney, or
by an officer of the title insurer or agent of the title insurer which issued
the related title insurance policy, or commitment therefor, if the original has
been transmitted for recording until such time as the original is returned by
the public recording office or (iii) a copy of the Mortgage certified by the
public recording office in those instances where the original recorded Mortgage
has been lost or not yet returned;
(c) The original Assignment of Mortgage from the Originator that
transferred such Mortgage Loan to the applicable Depositor pursuant to the
Transfer Agreement to "U.S. Bank National Association, as Trustee under the
Pooling and Servicing Agreement dated as of August 1, 1999, without recourse" or
in blank; any such Assignments of Mortgage may be made by blanket assignments
for Mortgage Loans secured by the Mortgaged Properties located in the same
county if permitted by applicable local law;
(d) Except with respect to any Mortgage Loan secured by a second
priority lien and having a Principal Balance not in excess of $50,000 and listed
in EXHIBIT V, the original policy of title insurance or a true copy thereof or,
if such policy has not yet been delivered by the insurer, the commitment or
binder to issue same, or original documents of assurance of title;
(e) All intervening assignments, if any, showing a complete chain of
assignment from the originator to the applicable Originator, including any
recorded warehousing assignments, with evidence of recording thereon, certified
by a Responsible Officer of the applicable Originator as a true copy of the
original of such intervening assignments;
(f) A copy of all assumption and modification agreements, if any,
certified as a true copy by a Responsible Officer of the applicable Originator;
(g) If the Mortgaged Property is held in an Illinois Land Trust, the
original Assignment of Beneficial Interest, or, if the trustee of such Illinois
Land Trust retains such original Assignment of Beneficial Interest, a certified
true copy of such Assignment of Beneficial Interest so certified by such
trustee;
(h) If the Mortgaged Property is held in an Illinois Land Trust, an
original Reassignment of Assignment of Beneficial Interest from the applicable
Originator to "U.S. Bank National Association, as Trustee under the Pooling and
Servicing Agreement dated as of August 1, 1999, Series 1999-3" or in blank. In
the event that the Mortgage Loan was acquired by the applicable Originator in a
merger, the Reassignment of the Assignment of Beneficial Interest must be by
"Originator, successor by merger to [name of predecessor]"; and in the event
that the Mortgage Loan was acquired or originated by the applicable Originator
while doing business under another name, the Reassignment of Assignment of
Beneficial Interest must be by "Originator, formerly known as [previous name]";
(i) If the Mortgaged Property is held in an Illinois Land Trust,
originals of all intervening Reassignments of Assignment of Beneficial Interest,
showing a complete chain of assignment from the beneficiaries of such Illinois
Land Trust to the applicable Originator of all of such beneficiaries' right,
title, and interest in, to, and under the trust agreement with respect to such
Illinois Land Trust; and
(j) If the Mortgaged Property is held in an Illinois Land Trust, (A)
a certified copy of the instrument creating the Illinois Land Trust, (B) a copy
of the UCC-1 Financing Statement evidencing the assignment of the Mortgagor's
beneficial interest in the Illinois Land Trust, with evidence of filing thereon,
and (C) the original personal guaranty of the Mortgage Note, executed by each
beneficiary of the Illinois Land Trust.
The applicable Depositor shall use its reasonable efforts to
promptly deliver or cause to be delivered to the Trustee or the Custodian: (a)
the original recorded Mortgage in those instances where a copy thereof was
delivered hereunder; (b) the original recorded Assignment of Mortgage to the
applicable Originator, which, together with any intervening assignments of
Mortgage, evidences a complete chain of assignment from the originator to the
applicable Originator in those instances where copies of such Assignments were
delivered; and (c) the title insurance policy or assurance required in PARAGRAPH
(D) above. The applicable Depositor shall, within five (5) Business Days after
the receipt thereof, and in any event, within twelve months after the Closing
Date, deliver or cause to be delivered to the Trustee or the Custodian each
document described in any of the preceding CLAUSES (A), (B) AND (C); PROVIDED,
HOWEVER, that if a document described in the preceding CLAUSE (A) OR CLAUSE (B)
has not been returned from the appropriate public recording office, the
applicable Depositor shall deliver a certified copy of the Mortgage and a
receipted copy of the Assignment from the appropriate recording office prior to
the expiration of such twelve-month period. Notwithstanding anything to the
contrary contained in this SECTION 2.04, the applicable Depositor shall be
deemed to have satisfied its obligations to deliver a Mortgage or Assignment of
Mortgage upon delivery to the Trustee or the Custodian a copy of such Mortgage
or Assignment of Mortgage, as applicable, certified by the public recording
office to be a true copy of the recorded original thereof. From time to time the
applicable Depositor may forward or cause to be forwarded to the Trustee or the
Custodian additional original documents evidencing an assumption or modification
of a Mortgage Loan. All Mortgage Loan documents held by the Trustee or the
Custodian as to each Mortgage Loan are referred to herein as the "Mortgage
File".
The Servicer covenants and agrees to take all action necessary or
desirable under applicable state law to transfer the benefits of the lien and
security interest in each manufactured or mobile home and the related Mortgaged
Property to the Trustee, including, without limitation, the filing of UCC-3
assignments, notations on the certificates of title and recordation of the
Assignment of Mortgage within the time periods required by this SECTION 2.04.
As promptly as practicable following the occurrence of the
Recordation Trigger, but in no event more than 90 days following the occurrence
of the Recordation Trigger, the Servicer shall at its own expense either (i)
record in favor of the Trustee each Assignment of Mortgage and each Reassignment
of Assignment of Beneficial Interest referred to in paragraphs (c) and (h) of
this Section 2.04 with respect to all of the Mortgage Loans in the appropriate
real property or other records, or (ii) deliver to the Trustee an Opinion of
Counsel satisfactory to the Rating Agencies and the Certificate Insurer to the
effect that recording is not required and no other action on the part of such
Depositor is required (other than such actions as have been taken) to protect
the Trustee's right, title and interest in and to the related Mortgage and Note.
All recording required pursuant to this SECTION 2.04 shall be
accomplished by and at the expense of the Servicer. For purposes of determining
whether a signature is made on an instrument or document, stapling of an
attachment shall be a sufficient affixation to cause the attachment to
constitute part of the instrument or document.
Section 2.05 [RESERVED].
Section 2.06 ACCEPTANCE BY TRUSTEE OF THE TRUST FUND; CERTAIN
SUBSTITUTIONS; CERTIFICATION BY TRUSTEE.
(a) The Trustee hereby acknowledges receipt of the Trust Fund, and
declares that it will hold the Mortgage Loans, as well as any other assets
delivered to it in trust, upon and subject to the conditions set forth in this
Agreement for the benefit of the Certificateholders, the Trustee as holder of
the REMIC I Regular Interests, REMIC II Regular Interests, REMIC III Regular
Interests and REMIC IV Regular Interests, and the Certificate Insurer, as their
interests may appear. The Trustee shall execute and deliver on the Closing Date
an initial certification of receipt by it or by the Custodian on its behalf, for
each Mortgage Loan of the items listed in SECTION 2.04(A), (B), (C), (G) AND
(H), in the form attached as EXHIBIT E hereto (other than any Mortgage Loan paid
in full or any Mortgage Loan specifically identified in such certification as
not covered by such certification), and declares that it will hold such
documents and any amendments, replacements or supplements thereto, as well as
any other assets delivered to it in trust, to the extent set forth herein, for
the benefit of the Certificateholders, the Trustee as holder of the REMIC I
Regular Interests, REMIC II Regular Interests, REMIC III Regular Interests and
REMIC IV Regular Interests, and the Certificate Insurer, as their interests may
appear. The Trustee agrees to review (or cause to be reviewed) each Mortgage
File within 45 days after the Closing Date (or, with respect to any Qualified
Substitute Mortgage Loan, within 45 days after the receipt thereof by the
Custodian) and to deliver to the Representative, the Depositors, the Servicer
and the Certificate Insurer an interim certification in the form attached hereto
as EXHIBIT F-1 on or before such date to the effect that, as to each Mortgage
Loan listed in the Mortgage Loan Schedule (other than any Mortgage Loan paid in
full or any Mortgage Loan specifically identified in such certification as not
covered by such certification), (i) all documents required to be delivered to it
pursuant to this Agreement are in its possession (other than those described in
SECTION 2.04(A)(II) AND 2.04(F)), (ii) such documents have been reviewed by it
and have not been mutilated, damaged, torn or otherwise physically altered
(handwritten additions, changes or corrections shall not constitute physical
alteration if properly initialed by the Mortgagor) and relate to such Mortgage
Loan, and (iii) based on its examination and only as to the foregoing documents,
the information set forth on the Mortgage Loan Schedule (other than items (i),
(iv) and (x) of the definition of Mortgage Loan Schedule) accurately reflects
the information set forth in the Mortgage File. The Trustee shall be under no
duty or obligation to inspect, review or examine any such documents,
instruments, certificates or other papers to determine that they are genuine,
enforceable, or appropriate for the represented purpose or that they are other
than what they purport to be on their face. Within 375 days after the Closing
Date, the Trustee shall deliver (or cause to be delivered) to the Servicer, the
Depositors and the Certificate Insurer a final certification in the form
attached hereto as EXHIBIT F-2 evidencing the completeness of the Mortgage
Files.
(b) If the Certificate Insurer or the Trustee during the process of
reviewing the Mortgage Files finds any document constituting a part of a
Mortgage File which is not executed, has not been received, is unrelated to the
Mortgage Loan identified in the Mortgage Loan Schedule, or does not conform to
the requirements of SECTION 2.04 or substantively to the description thereof as
set forth in the Mortgage Loan Schedule, the Trustee, or the Certificate
Insurer, as applicable, shall promptly so notify the Servicer, the Trustee, the
Representative, the Depositors and the Certificate Insurer. In performing any
such review, such Person may conclusively rely on the related Originator as to
the purported genuineness of any such document and any signature thereon. It is
understood that the scope of such Person's review of the Mortgage Files is
limited solely to confirming that the documents listed in SECTION 2.04 (other
than those described in SECTION 2.04(F)) have been executed and received and
relate to the Mortgage Files identified in the Mortgage Loan Schedule. The
Servicer agrees to use reasonable efforts to cause to be remedied a material
defect in a document constituting part of a Mortgage File of which it is so
notified by the Certificate Insurer or the Trustee. If, however, within 60 days
after receipt by it of the final certification referred to in paragraph (a) of
this SECTION 2.06 (or within 30 days after the Closing Date, in the case of
failure to deliver original Mortgage Notes), the Servicer has not caused to be
remedied any defect described in such final certification and such defect
materially and adversely affects the interest of the Certificateholders in the
related Mortgage Loan or the interests of the Certificate Insurer, the Servicer
will on the third Business Day preceding the Distribution Date immediately
succeeding the end of such 60 day (or 30 day, in the case of failure to deliver
original Mortgage Notes) period (i) if within 2 years of the Closing Date,
substitute, or cause the Depositors or the applicable Originator to substitute,
in lieu of such Mortgage Loan a Qualified Substitute Mortgage Loan in the manner
and subject to the conditions set forth in SECTION 3.03 or (ii) purchase, or
cause the Depositors or the applicable Originators to purchase, such Mortgage
Loan at a purchase price equal to the Principal Balance of such Mortgage Loan as
of the date of purchase, plus all accrued and unpaid interest on such Principal
Balance, computed at the Mortgage Interest Rate, net of the applicable Servicing
Fee if the Representative is the Servicer, plus the amount of any unreimbursed
Servicing Advances made by the Servicer with respect to such Mortgage Loan out
of funds on deposit in the Principal and Interest Account pursuant to SECTION
5.01(F), which purchase price shall be deposited in the Principal and Interest
Account on the next succeeding Determination Date (after deducting therefrom any
amounts received in respect of such purchased Mortgage Loan or Loans and being
held in the Principal and Interest Account for future distribution); provided
that if such defect caused such Mortgage Loan not to be a "qualified mortgage"
within the meaning of Code Section 860G(a)(3), such repurchase or, if
applicable, substitution shall occur within 90 days of the earlier of the
delivery of the Trustee's interim certification or Servicer's discovery of such
defect.
(c) Upon receipt by the Trustee of a certification of a Servicing
Officer of the Servicer of such substitution or acceptance and the deposit of
the amounts described above in the Principal and Interest Account (which
certification shall be in the form of EXHIBIT B to the Custodial Agreement) the
Trustee shall release to the Servicer for release to the Depositors or the
Originators, as appropriate, the related Mortgage File and shall execute,
without recourse, and deliver such instruments of transfer necessary to transfer
such Mortgage Loan to the Representative or the respective Depositor.
(d) If recordation of any Assignment of Mortgage or Reassignment of
Assignment of Beneficial Interest is required hereunder after the occurrence of
a Recordation Trigger, the original of each such recorded Assignment of Mortgage
and Reassignment of Assignment of Beneficial Interest shall be delivered to the
Trustee or the Custodian within 10 days following the date on which it is
returned to the related Depositor or the Servicer by the office with which such
Assignment of Mortgage or Reassignment of Assignment of Beneficial Interest was
filed for recordation and, within 10 days following receipt by the Trustee or
Custodian, as applicable, of the recorded Assignment of Mortgage or Reassignment
of Assignment of Beneficial Interest, the Trustee shall review or shall cause
the Custodian to review such Assignment of Mortgage or Reassignment of
Assignment of Beneficial Interest to confirm that such Assignment of Mortgage or
Reassignment of Assignment of Beneficial Interest has been recorded. Upon
receipt by the Trustee or the Custodian, as applicable, of the recorded
Assignment of Mortgage or Reassignment of Assignment of Beneficial Interest,
such recorded Assignment of Mortgage or Reassignment of Assignment of Beneficial
Interest shall become part of the Mortgage File. The Trustee shall notify the
related Depositor, the Servicer and the Certificate Insurer of any defect in
such Assignment of Mortgage or Reassignment of Assignment of Beneficial Interest
if it shall have actual knowledge of any such defect based on such review. The
Servicer or the related Depositor shall have a period of 30 days following such
notice to correct or cure such defect. In the event that the Servicer or the
related Depositor fails to record an Assignment of Mortgage or Reassignment of
Assignment of Beneficial Interest as herein provided (which Assignment of
Mortgage or Reassignment of Assignment of Beneficial Interest was required to be
recorded) and the Trustee shall have actual knowledge of such failure, the
Trustee shall prepare and file or shall cause the Custodian to prepare and file
such Assignment of Mortgage or Reassignment of Assignment of Beneficial Interest
for recordation in the appropriate real property or other records, and the
Servicer and the related Depositor hereby appoints the Trustee and the Custodian
as its attorney-in-fact with full power and authority acting in its stead for
the purpose of such preparation, execution and recordation. Any expense incurred
by the Trustee or the Custodian not otherwise paid for by the related Depositor
or the Servicer as required hereunder in connection with the preparation and
recordation of such Assignment of Mortgage and Reassignment of Assignment of
Beneficial Interest shall be reimbursed to the Trustee or Custodian, as
applicable, pursuant to Section 12.05.
Section 2.07 REMIC ADMINISTRATION.
(a) Tax Administration.
(1) Elections will be made by the Trustee on behalf of the
Trust Fund to treat the assets of the Trust Fund, excluding the rights of the
Class A Certificates to receive payments in respect of their related Interest
Carryovers, as four separate REMICs under the Code ("REMIC I," "REMIC II,"
"REMIC III" and "REMIC IV," respectively, and each, a "Trust REMIC"). Such
elections will be made on Form 1066 or other appropriate federal tax or
information return for each Trust REMIC for the taxable year ending on the last
day of the calendar year in which the Certificates are issued. The assets of
REMIC I will consist of all of the assets constituting the Trust Fund other than
the assets of REMIC II, REMIC III and REMIC IV and the rights of the Class A
Certificates to receive payments in respect of their related Interest
Carryovers. REMIC I will issue classes of interests which will be the REMIC I
Regular Interests (which will be uncertificated and will represent the "regular
interests" in REMIC I) and the Class R-I Certificates, which will be the sole
class of "residual interests" in REMIC I. The Trustee will hold the REMIC I
Regular Interests in trust for the benefit of REMIC II. The assets of REMIC II
will consist of the REMIC I Regular Interests and the REMIC II Distribution
Account. REMIC II will issue classes of interests which will be the REMIC II
Regular Interests (which will be uncertificated and will represent the "regular
interests" in REMIC II) and the Class R-II Certificates, which will be the sole
class of "residual interests" in REMIC II. The Trustee will hold the REMIC II
Regular Interests in trust for the benefit of REMIC III. The assets of REMIC III
will consist of the REMIC II Regular Interests and the REMIC III Distribution
Account. REMIC III will issue classes of interests which will be the REMIC III
Regular Interests (which will be uncertificated and will represent the "regular
interests" in REMIC III) and the Class R-III Certificates, which will be the
sole class of "residual interests" in REMIC III. The Trustee will hold the REMIC
III Regular Interests in trust for the benefit of REMIC IV. The assets of REMIC
IV will consist of the REMIC III Regular Interests and the REMIC IV Distribution
Account. REMIC IV will issue the REMIC IV Regular Interests (which will
represent the "regular interests" in REMIC IV represented by the Class A and the
Class X Certificates) and the Class R-IV Certificates, which will be the sole
class of "residual interests" in REMIC IV. The Owner of the Class R-I, Class
R-II, Class R-III or Class R-IV Certificates, respectively, representing at any
time the largest Percentage Interest in such Class shall be the Tax Matters
Person with respect to the applicable Trust REMIC. Each holder of a Class R-I,
Class R-II, Class R-III and Class R-IV Certificate, as a condition of ownership
thereof, irrevocably appoints the Trustee to act as its agent and attorney-in
fact to perform all duties of the Tax Matters Person. The "latest possible
maturity date" within the meaning of Treasury Regulation Section 1.860G-1(a)(4)
of the REMIC I Regular Interests, the REMIC II Regular Interests, the REMIC III
Regular Interests and the REMIC IV Regular Interests shall be the Final
Scheduled Distribution Date.
(2) The Closing Date is hereby designated as the "Startup Day"
of each Trust REMIC within the meaning of Section 860G(a)(9) of the Code.
(3) Except as provided in SECTION 12.05, the Trustee shall pay
(and shall be entitled to reimbursement thereof by the Servicer or otherwise in
accordance with the terms of this Agreement) the ordinary and usual expenses in
connection with the preparation, filing and mailing of tax information reports
and returns that are incurred by it in the ordinary course of its administration
of its tax-related duties under this Agreement, but extraordinary or unusual
expenses, costs or liabilities incurred in connection with its tax-related
duties under this Agreement, including without limitation any expenses, costs or
liabilities associated with audits, required independent opinions regarding tax
methodology and related matters or any administrative or judicial proceedings
with respect to each Trust REMIC that involve the Internal Revenue Service or
state tax authorities, shall be expenses of the Trust Fund.
(4) The Trustee shall prepare and file all of the Trust
REMICs' federal and state income or franchise tax and information returns.
Except as provided in SECTION 12.05, the expenses of preparing and filing such
returns shall be borne by the Trustee. The Servicer and the Depositors shall
provide on a timely basis to the Trustee or its designee such information with
respect to each Trust REMIC as is in their possession, which the Servicer or the
Depositors has or have received or prepared by virtue of its activities as
Servicer or Depositors hereunder and reasonably requested by the Trustee to
enable it to perform its obligations under this subsection, and the Trustee
shall be entitled to rely on such information in the performance of its
obligations hereunder.
(5) The Trustee shall perform on behalf of the Trust Fund and
each Trust REMIC all tax reporting duties and other tax compliance duties that
are the responsibility of a REMIC under the Code, the REMIC Provisions, or other
compliance guidance issued by the Internal Revenue Service or any state or local
taxing authority. Among its other duties, the Trustee shall provide (i) to the
Internal Revenue Service or other Persons (including, but not limited to, the
transferor of any Residual Certificate to a Disqualified Organization or to an
agent that has acquired any Residual Certificate on behalf of a Disqualified
Organization) such information as is necessary for the application of any tax
relating to the transfer of any Residual Certificate to any Disqualified
Organization pursuant to Section 860E(e) of the Code and the Treasury
Regulations thereunder and (ii) to the Certificateholders such information or
reports as are required by the Code or REMIC Provisions. Each of the Depositors
and the Servicer shall provide on a timely basis (and in no event later than 30
days after the Trustee's request) to the Trustee or its designee such
information with respect to each Trust REMIC as is in its possession and
reasonably requested in writing by the Trustee to enable it to perform its
obligations under this subsection.
(6) [Reserved]
(7) The Trustee and the Servicer shall perform their
obligations under this Agreement and the REMIC Provisions in a manner consistent
with the status of each Trust REMIC as a REMIC or, as appropriate, shall adopt a
plan of complete liquidation.
(8) The Trustee and the Servicer shall not take any action or
cause any Trust REMIC to take any action, within their respective control and
the scope of their specific respective duties under this Agreement that, under
the REMIC Provisions, could (i) endanger the status of any Trust REMIC as a
REMIC or (ii) result in the imposition of a tax upon any Trust REMIC (including
but not limited to the tax on prohibited transactions as defined in Code Section
860F(a)(2) and the tax on prohibited contributions as defined in Code Section
860G(d)) unless the Trustee has received a Nondisqualification Opinion (at the
expense of the party seeking to take such action) with respect to such action.
(9) To the extent not paid pursuant to paragraph (d) of this
SECTION 2.07, the Trustee shall pay when due any and all federal, state and
local taxes imposed on the applicable Trust REMIC or its assets or transactions,
including, without limitation, "prohibited transaction" taxes, as defined in
Section 860F of the Code, any tax on contributions imposed by Section 860G(d) of
the Code, and any tax on "net income from foreclosure property" as defined in
Section 860G(c) of the Code from the REMIC I Distribution Account, the REMIC II
Distribution Account, the REMIC III Distribution Account or the REMIC IV
Distribution Account pursuant to Section 6.02(iv)(E), and shall reimburse such
amounts to the applicable Trust REMIC, prior to current or future amounts
otherwise distributable to the Holders of any Class X Certificates pursuant to
SECTION 6.05.
(10) The Trustee shall, for federal income tax purposes,
maintain books and records with respect to each Trust REMIC on a calendar year
and on an accrual basis. Notwithstanding anything to the contrary contained
herein, all amounts collected on the Mortgage Loans shall, for federal income
tax purposes, be allocated first to interest due and payable on the Mortgage
Loans (including interest on overdue interest) (other than additional interest
at a penalty rate payable following a default). The books and records must be
sufficient concerning the nature and amount of each Trust REMIC's investments to
show that each Trust REMIC has complied with the REMIC Provisions.
(11) Neither the Trustee nor the Servicer shall enter into any
arrangement by which any Trust REMIC will receive a fee or other compensation
for services.
(12) In order to enable the Trustee to perform its duties as
set forth herein, the Depositors shall provide, or cause to be provided, to the
Trustee within 10 days after the Closing Date all information or data that the
Trustee reasonably determines to be relevant for tax purposes on the valuations
and offering prices of the Certificates, including, without limitation, the
yield, issue prices, pricing prepayment assumption and projected cash flows of
the Class A Certificates, the Class X Certificates and the Residual
Certificates, as applicable, and the projected cash flows on the Mortgage Loans.
Thereafter, the Depositors shall provide to the Trustee, promptly upon request
therefor, any such additional information or data that the Trustee may, from
time to time, reasonably request in order to enable the Trustee to perform its
duties as set forth herein. The Trustee is hereby directed to use any and all
such information or data provided by the Depositors in the preparation of all
federal and state income or franchise tax and information returns and reports
for the Trust REMICs to Certificateholders as required herein. The Depositors
hereby indemnify the Trustee for any losses, liabilities, damages, claims or
expenses of the Trustee arising from any errors or miscalculations of the
Trustee pursuant to this Section that result from any failure of the Depositors
to provide, or to cause to be provided, accurate information or data to the
Trustee (but not resulting from the methodology employed by the Trustee) on a
timely basis and such indemnifications shall survive the termination of this
Agreement.
(13) The Servicer shall prepare and file with the Internal
Revenue Service, on behalf of each Trust REMIC, an application for a taxpayer
identification number for such Trust REMIC on IRS Form SS-4 or by any other
permissible method. The Trustee, upon receipt from the Internal Revenue Service
of the Notice of Taxpayer Identification Number Assigned, shall promptly forward
a copy of such notice to the Depositors. The Trustee shall prepare and file Form
8811 on behalf of REMIC IV and shall designate from time to time an appropriate
Person to respond to inquiries by or on behalf of Certificateholders for
original issue discount and related information in accordance with applicable
provisions of the Code. It is understood that the Servicer will engage an
accounting firm to prepare the necessary tax filings required by the Trustee
under this Section 2.07(a) or Section 2.10(b).
The Trustee agrees that all such information or data so obtained by
it are to be regarded as confidential information and agrees that it shall use
its best reasonable efforts to retain in confidence, and shall ensure that its
officers, employees and representatives retain in confidence, and shall not
disclose, without the prior written consent of the Depositors, any or all of
such information or data, or make any use whatsoever (other than for the
purposes contemplated by this Agreement) of any such information or data without
the prior written consent of the Depositors, unless such information is
generally available to the public (other than as a result of a breach of this
Section) or is required by law or applicable regulations to be disclosed.
(b) MODIFICATIONS OF MORTGAGE LOANS. Notwithstanding anything to the
contrary in this Agreement, neither the Trustee nor the Servicer shall permit
any modification of, or take any action with respect to, the Mortgage Loans
(including the Mortgage Interest Rate or, in the case of a Mortgage Loan in the
Adjustable Rate Group, the method of determining the Mortgage Interest Rate, the
Principal Balance, the amortization schedule, any other term affecting the
amount or timing of payments on the Mortgage Loans or the collateral for the
Mortgage Loans), or any other material term of a Mortgage Loan, that would
result in an exchange within the meaning of Treasury Regulations Section
1.860G-2(b) unless the Trustee or the Servicer has received a
Nondisqualification Opinion or a ruling from the Internal Revenue Service (at
the expense of the party making the request of the Servicer or the Trustee to
modify the Mortgage Loans) to the same effect as a Nondisqualification Opinion
with respect to such modification.
(c) PROHIBITED TRANSACTIONS AND ACTIVITIES. The Trustee shall not
permit the sale, disposition (except in a disposition pursuant to (i) the
bankruptcy or insolvency of any Trust REMIC or (ii) the termination of any Trust
REMIC in a "qualified liquidation" as defined in Section 860F(a)(4) of the Code)
or substitution of the Mortgage Loans (except a substitution pursuant to
SECTIONS 2.06(B) or 3.03) or the substitution of a property for a Mortgaged
Property, nor acquire any assets for any Trust REMIC (other than REO Property or
a Qualified Substitute Mortgage Loan pursuant to SECTIONS 2.06(B) or 3.03), nor
accept any contributions to any Trust REMIC (other than a cash contribution
during the 3-month period beginning on the Startup Day), unless it has received
an Opinion of Counsel (at the expense of the Person requesting the Trustee to
take such action) to the effect that such disposition, acquisition,
substitution, or acceptance will not (a) affect adversely the status of any
Trust REMIC as a REMIC or of the REMIC I Regular Interests, the REMIC II Regular
Interests, the REMIC III Regular Interests or the REMIC IV Regular Interests
represented by the Class A Certificates and the Class X Certificates as the
regular interests therein, (b) affect the distribution of interest or principal
on the Certificates, (c) result in the encumbrance of the assets transferred or
assigned to any Trust REMIC (except pursuant to the provisions of this
Agreement) or (d) cause any Trust REMIC to be subject to an unindemnified tax on
"prohibited transactions" or "prohibited contributions" pursuant to the REMIC
Provisions.
(d) In the event that any tax is imposed on "prohibited
transactions" of any Trust REMIC as defined in Section 860F(a)(2) of the Code,
on the "net income from foreclosure property" of any Trust REMIC as defined in
Section 860G(c) of the Code, on any contribution to any Trust REMIC after the
Startup Day pursuant to Section 860G(c) of the Code, or any other tax is
imposed, such tax shall be paid by (i) the Trustee, if such tax arises out of or
results from a breach by the Trustee of any of its obligations under this
Agreement, which breach constitutes negligence or willful misconduct of the
Trustee or (ii) the Servicer or the Depositors, if such tax arises out of or
results from a breach by the Servicer or the Depositors of any of their
respective obligations under this Agreement.
(e) Any inconsistencies or ambiguities in this Agreement or in the
administration of a Trust REMIC shall be resolved in a manner that preserves the
validity of the elections to be treated as four separate REMICs.
Section 2.08 EXECUTION OF CERTIFICATES.
The Trustee acknowledges (i) the assignment to it of Mortgage Loans
in trust for the benefit of the Certificateholders and the Certificate Insurer,
as their interests may appear, and subject to the terms and conditions of this
Agreement and (ii) the delivery of the Mortgage Files as set forth above and,
concurrently with such delivery, in exchange for the Mortgage Loans, the
Mortgage Files and the other assets conveyed by the Depositors pursuant to
SECTION 2.01 AND SECTION 2.04, the Trustee has executed and caused to be
authenticated and delivered to or upon the order of the Depositors, the
Certificates, each in Authorized Denominations.
Section 2.09 APPLICATION OF PRINCIPAL AND INTEREST.
In the event that Net Liquidation Proceeds on a Liquidated Mortgage
Loan are less than the Principal Balance of such Mortgage Loan plus accrued
interest thereon, or any Mortgagor makes a partial payment of any Monthly
Payment due on a Mortgage Loan, such Net Liquidation Proceeds or partial payment
shall be applied to payment of the related Mortgage Note as provided therein,
and if not so provided or if the related Mortgaged Property has become an REO
Property, first to interest accrued at the Mortgage Interest Rate and then to
principal; PROVIDED, HOWEVER, the Net Liquidation Proceeds with respect to a
Bankruptcy Loan shall be applied first, to unpaid accrued interest with respect
to the period after the date of the related Plan, second, to principal and
third, to Pre-Plan Interest.
Section 2.10 GRANTOR TRUST ADMINISTRATION.
(a) The Trustee shall treat the portion of the Trust Fund exclusive
of the Trust REMICs, consisting of the rights of the Class A Certificates to
receive payments in respect of their related Interest Carryovers, as a grantor
trust under Subpart E, Part I of Subchapter J of Chapter 1 of Subtitle A of the
Code. The Fixed Rate Certificates represent undivided beneficial interests in
the related "regular interests" in REMIC IV and the rights to receive payments
in respect of their related Fixed Rate Interest Carryovers. The Class A-1A
Certificates represent undivided beneficial interests in the related "regular
interests" in REMIC IV and the right to receive payments in respect of Class
A-1A LIBOR Interest Carryovers. The Class X Certificates represent undivided
beneficial interests in the Class X Interest, subject to the obligation to make
payments in respect of Interest Carryovers as provided herein.
(b) The Trustee shall report or cause to be reported to the
applicable Certificateholders, at the time or times and in the manner required
by the Code, each such Certificateholder's share of the income or gain and, if
applicable, expense or loss, with respect to its interest in the grantor trust
portion of the Trust Fund on a schedule to IRS Form 1041 (or such other form as
may be applicable) for the portion of the year during which such person was a
Certificateholder and shall prepare and file or cause to be prepared and filed
such IRS Form 1041 and schedules with the Internal Revenue Service at the time
and in the manner required by the Code.
<PAGE>
ARTICLE III
REPRESENTATIONS AND WARRANTIES
Section 3.01 REPRESENTATIONS OF THE SERVICER AND THE DEPOSITORS.
(1) The Servicer hereby represents and warrants to the Trustee,
the Certificate Insurer and the Certificateholders as of the Closing Date:
(a) The Servicer is duly organized, validly existing, and in good
standing under the laws of the State of Delaware and has all licenses necessary
to carry on its business as now being conducted and is licensed, qualified and
in good standing in each Mortgaged Property State if the laws of such state
require licensing or qualification in order to conduct business of the type
conducted by the Servicer and perform its obligations as Servicer hereunder; the
Servicer has the power and authority to execute and deliver this Agreement and
the Basic Documents to which it is a party and to perform in accordance
herewith; the execution, delivery and performance of this Agreement and the
Basic Documents to which it is a party (including all instruments of transfer to
be delivered pursuant to this Agreement and the Basic Documents to which it is a
party) by the Servicer and the consummation of the transactions contemplated
hereby have been duly and validly authorized by all necessary action; each of
this Agreement and the Basic Documents to which it is a party is the valid,
binding and enforceable obligation of the Servicer; and all requisite action has
been taken by the Servicer to make this Agreement and the Basic Documents to
which it is a party valid, binding and enforceable upon the Servicer in
accordance with its terms, subject to the effect of bankruptcy, insolvency,
reorganization, moratorium and other, similar laws relating to or affecting
creditors' rights generally or the application of equitable principles in any
proceeding, whether at law or in equity;
(b) All actions, approvals, consents, waivers, exemptions,
variances, franchises, orders, permits, authorizations, rights and licenses
required to be taken, given or obtained, as the case may be, by or from any
federal, state or other governmental authority or agency (other than any such
actions, approvals, etc. under any state securities laws, real estate
syndication or "Blue Sky" statutes, as to which the Servicer makes no such
representation or warranty), that are necessary in connection with the
performance by the Servicer of its obligations hereunder or under the Basic
Documents to which it is a party or the purchase and sale of the Certificates
and the execution and delivery by the Servicer of the documents to which it is a
party, have been duly taken, given or obtained, as the case may be, are in full
force and effect, are not subject to any pending proceedings or appeals
(administrative, judicial or otherwise) and either the time within which any
appeal therefrom may be taken or review thereof may be obtained has expired or
no review thereof may be obtained or appeal therefrom taken, and are adequate to
authorize the consummation of the transactions contemplated by this Agreement
and the Basic Documents and the other documents on the part of the Servicer and
the performance by the Servicer of its obligations as the Servicer under this
Agreement and such of the other Basic Documents to which it is a party;
(c) The consummation of the transactions contemplated by this
Agreement and the Basic Documents will not result in the breach of any terms or
provisions of the bylaws of the Servicer or result in the breach of any term or
provision of, or conflict with or constitute a default under or result in the
acceleration of any obligation under, any material agreement, indenture or loan
or credit agreement or other material instrument to which the Servicer or its
property is subject, or result in the violation of any law, rule, regulation,
order, judgment or decree to which the Servicer or its property is subject;
(d) None of this Agreement, any of the Basic Documents to which it
is a party or the Prospectus nor any statement, report or other document
prepared by the Servicer and furnished or to be furnished pursuant to this
Agreement or in connection with the transactions contemplated hereby contains
any untrue statement of material fact or omits to state a material fact
necessary to make the statements contained herein or therein, in light of the
circumstances under which they were made, not misleading;
(e) There is no action, suit, proceeding or investigation pending
or, to the best of the knowledge of the Servicer, threatened against the
Servicer which, either in any one instance or in the aggregate, may result in
any material adverse change in the business, operations, financial condition,
properties or assets of the Servicer or in any material impairment of the right
or ability of the Servicer to carry on its business substantially as now
conducted, or in any material liability on the part of the Servicer or any Basic
Document to which it is a party or which would draw into question the validity
of this Agreement or the Mortgage Loans or of any action taken or to be taken in
connection with the obligations of the Servicer contemplated herein, or which
would be likely to impair materially the ability of the Servicer to perform
under the terms of this Agreement or any Basic Document to which it is a party;
(f) The Servicer is not in default with respect to any order or
decree of any court or any order, regulation or demand of any federal, state,
municipal or governmental agency, which default might have consequences that
would materially and adversely affect the condition (financial or other) or
operations of the Servicer or its properties or might have consequences that
would materially and adversely affect its performance hereunder or under the
Basic Documents or under any Subservicing Agreement;
(g) The collection practices used by the Servicer with respect to
each Mortgage Note and Mortgage have been in and will be all material respects
legal, proper, prudent and customary in the non-conforming mortgage origination
and servicing business; and
(h) The Servicer is an approved seller/servicer of first and second
mortgage loans for FNMA and FHLMC in good standing.
(2) Each Depositor hereby represents and warrants to the Trustee,
the Certificate Insurer and the Certificateholders as of the Closing Date:
(a) Such Depositor is duly organized, validly existing, and in
good standing under the laws of the jurisdiction of its incorporation and has
all licenses necessary to carry on its business as now being conducted and is
licensed, qualified and in good standing in each Mortgaged Property State if the
laws of such state require licensing or qualification in order to conduct
business of the type conducted by such Depositor and perform its obligations as
a Depositor hereunder; such Depositor has the power and authority to execute and
deliver this Agreement and to perform in accordance herewith; the execution,
delivery and performance of this Agreement and the Basic Documents to which it
is a party (including all instruments of transfer to be delivered pursuant to
this Agreement and the Basic Documents to which it is a party) by such Depositor
and the consummation of the transactions contemplated hereby have been duly and
validly authorized by all necessary action; each of this Agreement and the Basic
Documents to which it is a party is the valid, binding and enforceable
obligation of such Depositor; and all requisite action has been taken by such
Depositor to make this Agreement and the Basic Documents to which it is a party
valid, binding and enforceable upon such Depositor in accordance with its terms,
subject to the effect of bankruptcy, insolvency, reorganization, moratorium and
other, similar laws relating to or affecting creditors rights generally or the
application of equitable principles in any proceeding, whether at law or in
equity;
(b) All actions, approvals, consents, waivers, exemptions,
variances, franchises, orders, permits, authorizations, rights and licenses
required to be taken, given or obtained, as the case may be, by or from any
federal, state or other governmental authority or agency (other than any such
actions, approvals, etc. under any state securities laws, real estate
syndication or "Blue Sky" statutes, as to which such Depositor makes no such
representation or warranty), that are necessary in connection with the purchase
and sale of the Certificates and the execution and delivery by such Depositor of
the Basic Documents to which it is a party, have been duly taken, given or
obtained, as the case may be, are in full force and effect, are not subject to
any pending proceedings or appeals (administrative, judicial or otherwise) and
either the time within which any appeal therefrom may be taken or review thereof
may be obtained has expired or no review thereof may be obtained or appeal
therefrom taken, and are adequate to authorize the consummation of the
transactions contemplated by this Agreement and the other Basic Documents on the
part of such Depositor and the performance by such Depositor of its obligations
as a Depositor under this Agreement, the Transfer Agreement and such of the
other Basic Documents to which it is a party;
(c) The consummation of the transactions contemplated by this
Agreement and the Basic Documents will not result in the breach of any terms or
provisions of the bylaws of such Depositor or result in the breach of any term
or provision of, or conflict with or constitute a default under or result in the
acceleration of any obligation under, any material agreement, indenture or loan
or credit agreement or other material instrument to which such Depositor or its
property is subject, or result in the violation of any law, rule, regulation,
order, judgment or decree to which the Depositor or its property is subject;
(d) None of this Agreement, any of the Basic Documents to which
such Depositor is a party or the Prospectus nor any statement, report or other
document prepared by the Depositor and furnished or to be furnished pursuant to
this Agreement or the Basic Documents or in connection with the transactions
contemplated hereby contains any untrue statement of material fact or omits to
state a material fact necessary to make the statements contained herein or
therein, in light of the circumstances under which they were made, not
misleading;
(e) There is no action, suit, proceeding or investigation pending
or, to the best of such Depositor's knowledge, threatened against such Depositor
which, either in any one instance or in the aggregate, may result in any
material adverse change in the business, operations, financial condition,
properties or assets of such Depositor or in any material impairment of the
right or ability of such Depositor to carry on its business substantially as now
conducted, or in any material liability on the part of such Depositor or which
would draw into question the validity of this Agreement or the Basic Documents
or the Mortgage Loans or of any action taken or to be taken in connection with
the obligations of such Depositor contemplated herein, or which would be likely
to impair materially the ability of the Depositor to perform under the terms of
this Agreement or the Basic Documents to which it is a party;
(f) Such Depositor is not in default with respect to any order or
decree of any court or any order, regulation or demand of any federal, state,
municipal or governmental agency, which default might have consequences that
would materially and adversely affect the condition (financial or other) or
operations of such Depositor or its properties or might have consequences that
would materially and adversely affect its performance hereunder, under the Basic
Documents to which it is a party or under any Subservicing Agreement;
(g) Upon the receipt of each Mortgage File under this Agreement,
the Trustee will have good and indefeasible title on behalf of the
Certificateholders to each Mortgage Loan (other than the Representative's Yield
and amounts received on and after the Cut-off Date in respect of interest
accrued on or prior to the Cut-off Date) and such other items conveyed by the
Depositors to the Trustee hereunder free and clear of any lien (other than liens
which will be simultaneously released);
(h) The transfer, assignment and conveyance of the Mortgage Notes
and the Mortgages by such Depositor pursuant to this Agreement are not subject
to the bulk transfer laws or any similar statutory provisions in effect in any
applicable jurisdiction;
(i) Such Depositor did not transfer any interest in any
Mortgage Loan with any intent to hinder, delay or defraud any of its
respective creditors;
(j) Such Depositor is solvent and such Depositor will not be
rendered insolvent as a result of the transfer of the Mortgage Loans to the
Trust Fund or the sale of any of the Certificates;
(k) Such Depositor will not amend Articles THIRD, NINTH, TENTH and
ELEVENTH of its Certificate of Incorporation without the prior written consent
of the Certificate Insurer and the Rating Agencies; and
(l) Such Depositor will not engage in any activity which would
result in a downgrading of the Certificates by any Rating Agency or in a
downgrading of the "shadow rating" (that is, the rating without taking into
account the Certificate Insurance Policy) below investment grade by any Rating
Agency.
Section 3.02 ASSIGNMENT OF TRANSFER AGREEMENT; REPRESENTATIONS AND
WARRANTIES AS TO THE INDIVIDUAL MORTGAGE LOANS AND THE MORTGAGE POOL.
Pursuant to SECTION 2.01, each Depositor assigns to the Trustee (for
the benefit of the Certificateholders and the Certificate Insurer, as their
interests may appear) all of its right, title and interest in, to and under the
Transfer Agreement including, without limitation, the representations and
warranties of the Originators made to the Depositors pursuant to Section 3.01 of
the Transfer Agreement. The Depositors hereby represent and warrant to the
Trustee that the Depositors have taken no action which would cause such
representations and warranties of the Originators to be false in any material
respect as of the Closing Date, and acknowledge that the Trustee relies on the
representations and warranties of the Depositors under this Agreement and of the
Originators under the Transfer Agreement in accepting the Mortgage Loans and
executing and delivering the Certificates. The foregoing representation and
warranty speaks as of the Closing Date, but shall survive the transfer and
assignment of the Mortgage Loans to the Trustee for the benefit of the
Certificateholders and the Certificate Insurer, as their interests may appear.
Each Depositor hereby represents and warrants as follows to the
Trustee, the Certificate Insurer and the Certificateholders, with respect to
each Mortgage Loan as of the Closing Date (except as otherwise indicated);
provided, that all references to percentages of the Mortgage Loans in this
SECTION 3.02 refer in each case to the percentage of the aggregate Principal
Balance of the Mortgage Loans (or of the Mortgage Loans in Fixed Rate Group 1,
Fixed Rate Group 2 or Adjustable Rate Group, as applicable) as of the Cut-off
Date (rounded to two decimal points):
(a) The information with respect to each Mortgage Loan set forth in
the Mortgage Loan Schedule is true and correct;
(b) All of the original or certified documentation set forth in
SECTION 2.04 (including all material documents related thereto) has been or will
be delivered to the Trustee (or the Custodian on behalf of the Trustee) on the
Closing Date or as otherwise provided in SECTION 2.04;
(c) (1) Each Mortgage Loan is principally secured by Mortgaged
Property. Each Mortgaged Property is improved by a one- to four-family
Residential Dwelling, which, to the best of such Depositor's knowledge,
does not include (A) cooperatives, (B) mobile homes other than permanently
affixed mobile homes which constitute real property under state law, or
(C) except for not more than approximately 0.61% of the Mortgage Loans in
Fixed Rate Group 1, none of the Mortgage Loans in Fixed Rate Group 2 and
none of the Mortgage Loans in the Adjustable Rate Group, manufactured
housing units, as defined in the FNMA Selling Guide, which constitute
other than real property under state law; and
(i)With respect to each Mortgage Loan involving property improved
by a manufactured or mobile home, the Originator has taken all action
necessary to create a valid and perfected first or second priority (as
reflected in the Mortgage Loan Schedule) lien and security interest in
such manufactured or mobile home and the related Mortgaged Property,
including, without limitation, the filing of UCC financing statements or
notations on certificates of title if necessary, under applicable state
law;
(d) Each Mortgage Loan is being serviced by the Servicer or one or
more Subservicers;
(e) The Mortgage Note related to each Mortgage Loan in Fixed Rate
Group 1 and Fixed Rate Group 2 bears a fixed Mortgage Interest Rate; the
Mortgage Note related to each Mortgage Loan in the Adjustable Rate Group bears a
Mortgage Interest Rate that adjusts semi-annually, based on the London interbank
offered rate for six-month United States dollar deposits;
(f) Mortgage Loans constituting approximately 45.79% of the Mortgage
Loans in Fixed Rate Group 1, approximately 44.12% of the Mortgage Loans in Fixed
Rate Group 2 and approximately 73.85% of the Mortgage Loans in the Adjustable
Rate Group, are balloon loans which will provide for a final Monthly Payment
substantially greater than the preceding Monthly Payments. Approximately 0.04%,
2.24%, 35.68% and 7.81% of the Mortgage Loans in Fixed Rate Group 1,
approximately 3.56%, 32.27% and 8.27% of the Mortgage Loans in Fixed Rate Group
2 and approximately 9.26%, 59.96% and 4.63% of the Mortgage Loans in the
Adjustable Rate Group are balloon loans based on a 30-year amortization schedule
(except for approximately 0.03% of the Mortgage Loans in Fixed Rate Group 1 and
0.03% of the Mortgage Loans in Fixed Rate Group 2) and a single payment of the
remaining loan balances approximately 5, 7, 10, and 15 years, with respect to
the Mortgage Loans in Fixed Rate Group 1, and 7, 10 and 15 years, with respect
to the Mortgage Loans in Fixed Rate Group 2 and the Adjustable Rate Group after
origination, respectively. All of such balloon loans provide for Monthly
Payments based on an amortization schedule specified in the related Mortgage
Note and have a final balloon payment no earlier than 82 months following
origination and no later than 180 months following origination. Each other
Mortgage Note will provide for a schedule of substantially equal Monthly
Payments which are, if timely paid, sufficient to fully amortize the principal
balance of such Mortgage Note on or before its maturity date;
(g) Each Mortgage relating to a Mortgage Loan in Fixed Rate Group 1
and Fixed Rate Group 2 is a valid and subsisting first or second lien on the
Mortgaged Property subject, in the case of any second Mortgage Loan, only to a
first lien on such Mortgaged Property, and each Mortgage relating to a Mortgage
Loan in the Adjustable Rate Group is a valid and subsisting First Lien on the
Mortgaged Property, and subject in all cases to the exceptions to title set
forth in the title insurance policy or the other evidence of title enumerated in
SECTION 2.04(D), with respect to the related Mortgage Loan, which exceptions are
generally acceptable to second mortgage lending companies, and such other
exceptions to which similar properties are commonly subject and which do not
individually, or in the aggregate, materially and adversely affect the benefits
of the security intended to be provided by such Mortgage. If the Mortgaged
Property is held in an Illinois Land Trust (a "Land Trust Mortgage), (i) a
natural person is the beneficiary of such Illinois Land Trust, and either is a
party to the Mortgage Note or is a guarantor thereof, in either case, in an
individual capacity, and not in the capacity of trustee or otherwise, and, if a
party to the Mortgage Note, is jointly and severally liable under the Mortgage
Note; (ii) the Mortgagor is the trustee of such Illinois Land Trust, is a party
to the Mortgage Note and is the mortgagor under the Mortgage in its capacity as
such trustee and not otherwise; (iii) a land trust trustee, duly qualified under
applicable law to serve as such, has been properly designated and currently so
serves and is named as such in the land trust agreement and such trustee is
named in the Land Trust Mortgage as Mortgagor; (iv) all fees and expenses of the
land trust trustee which have previously become due or owing have been paid and
no such fees or expenses are or will become payable by the Certificateholders or
the Trust Fund; (v) the beneficiary is solely obligated to pay any fees and
expenses of the land trust trustee and the priority of the lien of the Land
Trust Mortgage is not and will not be subject or subordinate to any amounts
owing to the land trust trustee; (vi) the Mortgaged Property is occupied by the
beneficiary under the land trust agreement (if indicated to be owner occupied on
the Mortgage Loan Schedule) and, if such land trust agreement terminates, the
beneficiary will become the owner of the Mortgaged Property; (vii) the
beneficiary is obligated to make payments under the related Mortgage Note and
(subject to applicable law) will have personal liability for deficiency
judgments; (viii) the Land Trust Mortgages and assignments of beneficial
interest relating to land trusts in the Mortgage Pool were made in compliance
with their respective land trust agreements, were validly entered into by their
respective land trust trustee or beneficiary and did not, do not currently, and
will not in the future, violate any provision of their respective land trust
agreement; (ix) a UCC financing statement has been filed, continued, and will be
continued, without intervening liens, as the first lien upon the beneficial
interest in the Land Trust Mortgage; (x) each assignment of beneficial interest
with respect to Land Trust Mortgages in the Mortgage Pool was at the time of
respective assignment the only assignment of such beneficial interest in the
land trust, such assignment was accepted by the respective land trust trustee,
to the best of the Depositors' knowledge, subsequent assignments of the
beneficial interest in whole or in part have not been made, and such subsequent
assignments of the beneficial interest or any part thereof are not permitted
pursuant to a written agreement between the respective beneficiary and the
Mortgagee, until the expiration of the Mortgage Note in each respective land
trust; (xi) the Land Trust Mortgages are the first or second liens on the
Mortgaged Properties; no liens are in place against the beneficial interests, or
any part thereof, of any Land Trust Mortgage or collateral assignment of
beneficial interest, which liens are superior to the interest held by the
related Depositor; and the beneficiary or land trust trustee is forbidden,
pursuant to a written agreement between the beneficiary or the land trust
trustee (as applicable) and the Mortgagee, from using the land trust property or
beneficial interest, or any part of either, as security for any other debt of
the same priority as or senior to such Land Trust Mortgage until the expiration
date of its respective Mortgage Note; and (xii) the terms and conditions of the
land trust agreement do not prevent the free and absolute marketability of the
Mortgaged Property. As of the Cut-off Date, approximately 5.29% of the Mortgage
Loans in Fixed Rate Group 1, approximately 4.35% of the Mortgage Loans in Fixed
Rate Group 2 and approximately 13.18% of the Mortgage Loans in the Adjustable
Rate Group were related to Land Trust Mortgages;
(h) Except with respect to liens released immediately prior to the
transfer herein contemplated, immediately prior to the transfer and assignment
herein contemplated, the applicable Depositor held good and indefeasible title
to, and was the sole owner of, each Mortgage Loan conveyed by such Depositor
subject to no liens, charges, mortgages, encumbrances or rights of others; and
immediately upon the transfer and assignment herein contemplated, the Trustee
for the benefit of the Certificateholders will hold good and indefeasible title,
to, and be the sole owner of, each Mortgage Loan (other than the
Representative's Yield and amounts received on or after the Cut-off Date) in
respect of interest accrued prior to the Cut-off Date subject to no liens,
charges, mortgages, encumbrances or rights of others;
(i) Approximately 0.19% of the Mortgage Loans in Fixed Rate Group 1,
approximately 0.14% of the Mortgage Loans in Fixed Rate Group 2 and none of the
Mortgage Loans in the Adjustable Rate Group (excluding Bankruptcy Loans) are 30
or more days contractually delinquent; none of the Mortgage Loans in the
Mortgage Pool are 60 to 89 days contractually delinquent or more than 89 days
contractually delinquent; and none of the Mortgage Loans in the Mortgage Pool
(excluding Bankruptcy Loans) have been 30 or more days contractually delinquent
more than once in the 12 months preceding the Cut-off Date. For purposes of this
representation and warranty "30 or more days contractually delinquent" means
that a Monthly Payment due on a Due Date was unpaid as of the end of the month
of the next succeeding Due Date or following Due Dates. Approximately 0.09% of
the Mortgage Loans in Fixed Rate Group 1, none of the Mortgage Loans in Fixed
Rate Group 2 and none of the Mortgage Loans in the Adjustable Rate Group are
Bankruptcy Loans. Except for the Mortgage Loans listed on EXHIBIT G, to the best
of such Depositor's knowledge, none of the Mortgage Loans is subject to a Plan;
(j) To the best of such Depositor's knowledge, (i) there is no
delinquent tax or assessment lien on any Mortgaged Property and (ii) each
Mortgaged Property is free of material damage and is in average repair;
(k) No Mortgage Loan is subject to any right of rescission, set-off,
counterclaim or defense, including the defense of usury, nor will the operation
of any of the terms of the Mortgage Note or the Mortgage, or the exercise of any
right thereunder, render either the Mortgage Note or the Mortgage unenforceable
in whole or in part, or subject to any right of rescission, set-off,
counterclaim or defense, including the defense of usury, and no such right of
rescission, set-off, counterclaim or defense has been asserted with respect
thereto;
(l) To the best of such Depositor's knowledge, there is no
mechanics' lien or claim for work, labor or material affecting any Mortgaged
Property which is or may be a lien prior to, or equal with, the lien of such
Mortgage except those which are insured against by the title insurance policy
referred to in SECTION 3.02(N) below;
(m) Each Mortgage Loan at the time it was made complied in all
material respects with applicable state and federal laws and regulations,
including, without limitation, usury, equal credit opportunity and disclosure
laws;
(n) With respect to each Mortgage Loan, other than any Mortgage Loan
secured by a second priority lien and having a Principal Balance not in excess
of $50,000 and listed on EXHIBIT V hereto, a written commitment for a lender's
title insurance policy, issued in standard American Land Title Association or
California Land Title Association form, or other form customary and acceptable
in a particular jurisdiction, by a title insurance company acceptable to FNMA
and FHLMC and authorized to transact business in the state in which the related
Mortgaged Property is situated, together with a condominium endorsement, if
applicable, in an amount at least equal to the original Principal Balance of
such Mortgage Loan insuring the mortgagee's interest under the related Mortgage
Loan as the holder of a valid first or second mortgage lien of record on the
real property described in the Mortgage, subject only to exceptions of the
character referred to in SECTION 3.02(G) above, was effective on the date of the
origination of such Mortgage Loan, and, as of the Closing Date, such commitment
will be valid and thereafter the policy issued pursuant to such commitment shall
continue in full force and effect or, with respect to Mortgage Properties
located in jurisdictions in which it is customary and acceptable to obtain an
assurance of title in lieu of a title insurance policy, such assurance of title
has been obtained;
(o) The improvements upon each Mortgaged Property are covered by a
valid and existing hazard insurance policy with a generally acceptable carrier
that provides for fire and extended coverage representing coverage described in
SECTIONS 5.07 AND 5.08;
(p) A flood insurance policy is in effect with respect to each
Mortgaged Property with a generally acceptable carrier in an amount representing
coverage described in SECTIONS 5.07 OR 5.08, if and to the extent required by
SECTION 5.07 OR 5.08;
(q) Each Mortgage and Mortgage Note is the legal, valid and binding
obligation of the maker thereof and is enforceable in accordance with its terms,
except only as such enforcement may be limited by bankruptcy, insolvency,
reorganization, moratorium or other similar laws affecting the enforcement of
creditors' rights generally and by general principles of equity (whether
considered in a proceeding or action in equity or at law), and all parties to
each Mortgage Loan had full legal capacity to execute all Mortgage Loan
documents and convey the estate therein purported to be conveyed;
(r) The applicable Depositor has directed the Servicer to perform
any and all acts required to be performed to preserve the rights and remedies of
the Trustee in any insurance policies applicable to the Mortgage Loans
including, without limitation, any necessary notifications of insurers,
assignments of policies or interests therein, and establishments of co-insured,
joint loss payee and mortgagee rights in favor of the Trustee;
(s) No more than approximately 0.05% of the Mortgage Loans in Fixed
Rate Group 1, approximately 0.64% of the Mortgage Loans in Fixed Rate Group 2
and approximately 0.75% of the Mortgage Loans in the Adjustable Rate Group, are
secured by Mortgaged Properties located within any single five-digit zip code
area within the State of California. No more than approximately 0.35% of the
Mortgage Loans in Fixed Rate Group 1, approximately 1.19% of the Mortgage Loans
in Fixed Rate Group 2 and approximately 1.22% of the Mortgage Loans in the
Adjustable Rate Group, are secured by Mortgaged Properties located within any
single five-digit zip code area outside the State of California;
(t) At least approximately 97.93% of the Mortgage Loans in Fixed
Rate Group 1, approximately 99.54% of the Mortgage Loans in Fixed Rate Group 2
and approximately 98.54% of the Mortgage Loans in the Adjustable Rate Group, are
secured by an Owner Occupied Mortgaged Property;
(u) The terms of the Mortgage Note and the Mortgage have not been
impaired, altered or modified in any material respect, except by a written
instrument which has been recorded or is in the process of being recorded, if
necessary, to protect the interests of the Trustee and which has been or will be
delivered to the Trustee. The substance of any such alteration or modification
is reflected on the Mortgage Loan Schedule. Each original Mortgage was recorded,
and all subsequent assignments of the original Mortgage (other than the
Assignment to the Trustee) have been recorded in the appropriate jurisdictions
wherein such recordation is necessary to perfect the lien thereof as against
creditors of the Depositors (or, subject to SECTION 2.04 hereof, are in the
process of being recorded);
(v) No instrument of release or waiver has been executed in
connection with the Mortgage Loan, and no Mortgagor has been released, in whole
or in part;
(w) To the best of such Depositor's knowledge, all taxes,
governmental assessments, insurance premiums, water, sewer and municipal
charges, leasehold payments or ground rents which previously became due and
owing have been paid, or an escrow of funds has been established in an amount
sufficient to pay for every such item which remains unpaid and which has been
assessed but is not yet due and payable. Except for payments in the nature of
escrow payments, including without limitation, taxes and insurance payments, the
Servicer has not advanced funds, or induced, solicited or knowingly received any
advance of funds by a party other than the Mortgagor, directly or indirectly,
for the payment of any amount required by the Mortgage, except for interest
accruing from the date of the Mortgage Note or date of disbursement of the
Mortgage proceeds, whichever is greater, to the day which precedes by one month
the Due Date of the first installment of principal and interest. With respect to
Mortgaged Properties that are the subject of a ground lease, to the best of such
Depositor's knowledge, all lease rents, other payments or assessments that have
become due have been paid and the Mortgagor is not in material default under any
other provisions of the lease and the lease is valid, in good standing and in
full force and effect;
(x) To the best of such Depositor's knowledge, there is no
proceeding pending or threatened for the total or partial condemnation of the
Mortgaged Property, nor is such a proceeding currently occurring, and such
property is undamaged by waste, fire, earthquake or earth movement, windstorm,
flood, tornado or other casualty, so as to affect adversely the value of the
Mortgaged Property as security for the Mortgage Loan or the use for which the
premises were intended;
(y) To the best of such Depositor's knowledge, all of the
improvements which were included for the purpose of determining the appraised
value of the Mortgaged Property lie wholly within the boundaries and building
restriction lines of such property, and no improvements on adjoining properties
encroach upon the Mortgaged Property;
(z) To the best of such Depositor's knowledge, no improvement
located on or being part of the Mortgaged Property is in violation of any
applicable zoning law or regulation. To the best of such Depositor's knowledge,
all inspections, licenses and certificates required to be made or issued with
respect to all occupied portions of the Mortgaged Property and, with respect to
the use and occupancy of the same, including but not limited to certificates of
occupancy and fire underwriting certificates, have been made or obtained from
the appropriate authorities and the Mortgaged Property is lawfully occupied
under applicable law;
(aa) The proceeds of the Mortgage Loan have been fully disbursed,
and there is no obligation on the part of the mortgagee to make future advances
thereunder. Any and all requirements as to completion of any on-site or off-site
improvements and as to disbursements of any escrow funds therefor have been
complied with. All costs, fees and expenses incurred in making or closing or
recording the Mortgage Loans were paid;
(bb) The related Mortgage Note is not and has not been secured by
any collateral, pledged account or other security except the lien of the
corresponding Mortgage;
(cc) No Mortgage Loan was originated under a buydown plan;
(dd) There is no obligation on the part of the applicable Depositor
or any other party to make payments in addition to those made by the Mortgagor;
(ee) With respect to each Mortgage constituting a deed of trust, a
trustee, duly qualified under applicable law to serve as such, has been properly
designated and currently so serves and is named in such Mortgage, and no fees or
expenses are or will become payable by the Trustee to the trustee under such
deed of trust, except in connection with a trustee's sale after default by the
Mortgagor. If the Mortgaged Property is held in an Illinois Land Trust, the
trustee thereof is duly qualified under applicable law to serve as such, and has
been properly designated and currently so serves, and no fees or expenses are or
will become payable by the Trustee to such trustee;
(ff) No Mortgage Loan has a shared appreciation feature, or other
contingent interest feature;
(gg) With respect to each Mortgage Loan secured by a second priority
lien, the related First Lien requires equal monthly payments, or if it bears an
adjustable interest rate, the monthly payments for the related First Lien may be
adjusted not more frequently than once every six months;
(hh) With respect to each Mortgage Loan secured by a second priority
lien, either (i) no consent for the Mortgage Loan is required by the holder of
the related First Lien or (ii) such consent has been obtained and is contained
in the Mortgage File;
(ii) The maturity date of each Mortgage Loan secured by a second
priority lien is prior to the maturity date of the related First Lien if such
First Lien provides for a balloon payment;
(jj) All parties which have had any interest in the Mortgage Loan,
whether as mortgagee, assignee, pledgee or otherwise, are (or, during the period
in which they held and disposed of such interest, were) (1) in compliance with
any and all applicable licensing requirements of the laws of the state wherein
the Mortgaged Property is located, and (2)(A) organized under the laws of such
state, or (B) qualified to do business in such state, or (C) federal savings and
loan associations or national banks having principal offices in such state, or
(D) not doing business in such state so as to require qualification or
licensing;
(kk) The Mortgage contains a customary provision for the
acceleration of the payment of the unpaid principal balance of the Mortgage Loan
in the event the related security for the Mortgage Loan is sold without the
prior consent of the mortgagee thereunder;
(ll) Any future advances made prior to (and excluding) the Cut-off
Date have been consolidated with the outstanding principal amount secured by the
Mortgage, and the secured principal amount, as consolidated, bears a single
interest rate and single repayment term reflected on the Mortgage Loan Schedule
(or single method of determining the Mortgage Interest Rate if such Mortgage
Loan is in the Adjustable Rate Group). The consolidated principal amount does
not exceed the original principal amount of the Mortgage Loan. The Mortgage Note
does not permit or obligate the Servicer to make future advances to the
Mortgagor at the option of the Mortgagor;
(mm) The related Mortgage contains customary and enforceable
provisions which render the rights and remedies of the holder thereof adequate
for the realization against the Mortgaged Property of the benefits of the
security, including, (i) in the case of a Mortgage designated as a deed of
trust, by trustee's sale, and (ii) otherwise by judicial or non-judicial
foreclosure. There is no homestead or other exemption available to the Mortgagor
which would materially interfere with the right to sell the Mortgaged Property
at a trustee's sale or the right to foreclose the Mortgage except as set forth
in the Prospectus;
(nn) Except for bankruptcy-related defaults under the Bankruptcy
Loans, to the best of such Depositor's knowledge, there is no default, breach,
violation or event of acceleration existing under the Mortgage or the related
Mortgage Note and no event which, with the passage of time or with notice and
the expiration of any grace or cure period, would constitute a default, breach,
violation or event of acceleration; and neither the Servicer nor the applicable
Depositor has waived any default, breach, violation or event of acceleration;
(oo) All parties to the Mortgage Note and the Mortgage had legal
capacity to execute the Mortgage Note and the Mortgage and each Mortgage Note
and Mortgage have been duly and properly executed by such parties;
(pp) All amounts received on and after the Cut-off Date with respect
to the Mortgage Loans that are required to be deposited into the Principal and
Interest Account pursuant to SECTION 5.03 have been so deposited;
(qq) Each Mortgage Loan was originated and underwritten by, or
purchased and re-underwritten by, the Representative or by an affiliate of the
Representative;
(rr) As of the Cut-off Date, each Mortgage Loan conforms, and all
Mortgage Loans in the aggregate conform, in all material respects, to the
description thereof set forth in the Prospectus, including all statistical data
provided therein in tabular format or otherwise;
(ss) The Mortgage Loans were not selected by the Originators or the
Depositors for transfer to the Trustee (for the benefit of the
Certificateholders) hereunder on any basis intended to adversely affect the
assets of the Trust;
(tt) A full interior inspection appraisal was performed in
connection with each Mortgaged Property; provided, that for certain loans with
Combined Loan-To-Value Ratios less than 85% and balances less than $50,000 and
certain second Mortgage Loans with Combined Loan-To-Value Ratios less than 90%,
interior inspections may not be included;
(uu) The Mortgage Interest Rate for each Mortgage Loan in Fixed Rate
Group 1 is not less than 5.00% per annum and the Mortgage Interest Rate for each
Mortgage Loan in Fixed Rate Group 2 is not less than 8.52% per annum and the
Mortgage Interest Rate for each Mortgage Loan in Fixed Rate Group 1 is not more
than 18.95% per annum and the Mortgage Interest Rate for each Mortgage Loan in
Fixed Rate Group 2 is not more than 15.90% per annum; none of the Mortgage Loans
in the Adjustable Rate Group have current Mortgage Interest Rates less than
5.75%;
(vv) The gross margin for each Mortgage Loan in the Adjustable Rate
Group is not less than 2.75% per annum and not more than 10.30% per annum. All
of Mortgage Loans in the Adjustable Rate Group have periodic adjustment caps of
1.00%;
(ww) Each hazard insurance policy required to be maintained under
SECTION 5.07 of this Agreement with respect to such Mortgage Loan is a valid,
binding, enforceable and subsisting insurance policy of its respective kind and
is in full force and effect;
(xx) If the Mortgaged Property consists of a leasehold estate, the
Mortgage covers property improvements and the Mortgagor's leasehold interest in
the land upon which such improvements are situated; at origination of the
Mortgage Loan the term of the leasehold estate was scheduled to last for at
least ten years beyond the maturity date of the Mortgage or provided for
perpetual renewal covenants; the leasehold estate is assignable by the
Mortgagee; and the lease is valid and in full force and effect;
(yy) To the best of such Depositors' knowledge, no Mortgaged
Property was, at origination, located within a 1 mile radius of any site with
material environmental or hazardous waste risks;
(zz) With respect to each Bankruptcy Loan, (a) except for the
Bankruptcy Loans specified on EXHIBIT G, as of the Cut-off Date, the Mortgagor
is not contractually delinquent more than 30 days with respect to any payment
due under the related Plan, (b) the Current CLTV is less than or equal to 85%,
and (c) either (i) if the Current CLTV is between 60% and 85%, as of the Cut-off
Date, the Mortgagor has made at least six consecutive payments under the related
Plan or (ii) if the Current CLTV is less than 60%, as of the Cut-off Date, the
Mortgagor has made at least three consecutive payments under the related Plan;
(aaa) With respect to each Mortgage Loan which was originated in the
State of Alabama (each, an "Alabama Loan") (i) each such Alabama Loan was (A)
originated and underwritten by EquiCredit Corporation/Ala. & Miss. ("EQCC/ALA. &
MISS.") or (B) purchased and re-underwritten by EQCC/Ala. & Miss. from another
lender (each originating entity, an "ALABAMA Originator"), (ii) with respect
each such Alabama Loan secured by second mortgages, (A) the total "prepaid
finance charge" (as defined in Regulation Z promulgated under the Federal
Truth-in-Lending Act) paid by the related Mortgagor to the related Alabama
Originator plus (B) any yield spread premium ("RATE PARTICIPATION") paid by the
Alabama Originator did not exceed 5% of the original Principal Balance of such
Alabama Loan, (iii) the original Principal Balance of such Alabama Loan exceeded
$2000, (iv) the aggregate of all points and broker's fees did not exceed 10% of
the original principal balance of the Mortgage Loan, (v) no "referral fee" (as
defined in Regulation X promulgated under the Real Estate Settlement and
Procedures Act) was paid to any third party by the related Alabama Originator
with respect to such Alabama Loan, (vi) such Alabama Loan and the manner in
which it was originated fully complied with Alabama law, and (vii) such Alabama
Loan was not originated in such a manner, and neither the related Mortgage Note
nor Mortgage contain any provisions, that would cause such Alabama Loan to be
deemed unconscionable under Alabama law; the aggregate of all such Alabama
Mortgage Loans does not exceed approximately 0.08% of the Mortgage Loans in
Fixed Rate Group 1. None of the Mortgage Loans in Fixed Rate Group 2 and the
Adjustable Rate Group are Alabama Mortgage Loans;
(bbb) Except as specified in EXHIBIT Y, none of the Mortgage Loans
were originated in connection with the sale of properties acquired by the
Originators through foreclosure;
(ccc) With respect to each Mortgage Loan in the Adjustable Rate
Group, the CLTV does not exceed 100% and with respect to each Mortgage Loan in
Fixed Rate Group 1 and Fixed Rate Group 2, the CLTV does not exceed 100%;
(ddd) Except for the Mortgage Loans listed on EXHIBIT T, as of the
Cut-off Date none of the Mortgage Loans are subject to the Home Ownership and
Equity Protection Act of 1994; all notices required to be delivered to the
related Mortgagor pursuant to the Home Ownership and Equity Protection Act of
1994 have been delivered with respect to each Mortgage Loan listed on EXHIBIT T
and all other requirements of that Act have been complied with for each such
Mortgage Loan;
(eee) Each Mortgage Loan in the Adjustable Rate Group was originated
by a savings and loan association, savings bank, commercial bank, credit union,
insurance company, or similar institution which is supervised and examined by a
Federal or State authority, or by a mortgagee approved by the Secretary of
Housing and Urban Development pursuant to Sections 203 and 211 of the National
Housing Act;
(fff) Each Mortgage Loan constitutes a "qualified mortgage" within
the meaning of Section 860G(a)(3) of the Code. For this purpose, Section
860G(a)(3) of the Code shall be applied without regard to the rule contained in
Treasury Regulations Section 1.860G-2(f)(2) which treats a defective mortgage
loan as a "qualified mortgage" under certain circumstances. Accordingly, the
Transferors represent and warrant that each Mortgage Loan is directly secured by
a Mortgage on residential real property, and either (1) substantially all of the
proceeds of such Mortgage Loan were used to acquire, improve or protect such
residential real property and such interest in residential real property was the
sole security for such Mortgage Loan as of the Testing Date (as defined below),
or (2) the fair market value of the interest in real property which secures such
Mortgage Loan was at least equal to 80% of the principal amount of the Mortgage
Loan (a) as of the Testing Date or (b) as of the Closing Date. For purposes of
the previous sentence, (1) the fair market value of the referenced interest in
real property shall first be reduced by (a) the amount of any lien on such
interest in real property that is senior to the lien of the Mortgage Loan, and
(b) a proportionate amount of any lien on such interest in real property that is
on a parity with the Mortgage Loan, and (2) the "Testing Date" shall be the date
on which the referenced Mortgage Loan was originated unless (a) such Mortgage
Loan was modified after the date of its origination in a manner that would cause
a "significant modification" of such Mortgage Loan within the meaning of
Treasury Regulations Section 1.1001-3(e), and (b) such "significant
modification" did not occur at a time when such Mortgage Loan was in default or
when default with respect to such Mortgage Loan was reasonably foreseeable.
However, if the referenced Mortgage Loan has been subjected to a "significant
modification" after the date of its origination and at a time when such Mortgage
Loan was not in default or when default with respect to such Mortgage Loan was
not reasonably foreseeable, the "Testing Date" shall be the date upon which the
latest such "significant modification" occurred;
(ggg) The Depositors have no reason to believe that any Mortgage
Loan as of the Cut-off Date that is 30 or more days contractually delinquent
will not be brought current or will become delinquent again after it is brought
current; and
(hhh) The representations and warranties with respect to the
Mortgage Loans and Mortgage Pool set forth in SECTION 3.02(A) through (GGG),
inclusive, have been made to the Depositors by the Originators and the
Representative pursuant to SECTION 3.02(A) through (GGG), inclusive, of the
Transfer Agreement with respect to the Mortgage Loans and the Mortgage Pool, and
the Certificate Insurer is entitled to rely thereon.
Section 3.03 PURCHASE AND SUBSTITUTION.
It is understood and agreed that the representations and warranties
set forth in SECTIONS 3.01 AND 3.02 shall survive transfer of the Mortgage Loans
and delivery of the Certificates hereunder. Upon discovery by any Depositor, the
Servicer, any Subservicer, any Custodian, a Responsible Officer of the Trustee
or the Certificate Insurer of a breach of any of such representations and
warranties which materially and adversely affects the value of Mortgage Loans or
the interest of the Trustee, the Certificateholders or the Certificate Insurer,
or which materially and adversely affects the interests of the Trustee, the
Certificate Insurer, or the Certificateholders in the related Mortgage Loan in
the case of a representation and warranty relating to a particular Mortgage Loan
(notwithstanding that such representation and warranty was made to the
Depositors' best knowledge), the party discovering such breach shall give prompt
written notice to the others. Within 60 days of the earlier of its discovery or
its receipt of notice of any breach of a representation or warranty, the
Servicer shall (a) promptly cure, or cause the applicable Depositor or the
applicable Originator to cure, such breach in all material respects, or (b)
purchase, or cause the applicable Depositor or applicable Originator to
purchase, such Mortgage Loan by depositing in the Principal and Interest
Account, on the next succeeding Determination Date, in the manner and at the
price specified in SECTION 2.06(B), or by causing the applicable Depositor or
the applicable Originator to substitute, one or more Qualified Substitute
Mortgage Loans, provided such substitution is effected not later than the date
which is two years after the Closing Date. Any such substitution shall be
accompanied by payment of the Substitution Adjustment, if any, to be deposited
in the Principal and Interest Account.
As to any Deleted Mortgage Loan for which a Qualified Substitute
Mortgage Loan or Loans is substituted, the Servicer shall effect such
substitution by delivering to the Trustee or the Custodian on behalf of the
Trustee, a certification in the form of EXHIBIT B attached to the Custodial
Agreement, executed by a Servicing Officer and delivering to the Trustee (or the
Custodian on behalf of the Trustee, with a copy of such certification to the
Trustee) a copy of such certification, the documents constituting the Mortgage
File for such Qualified Substitute Mortgage Loan or Loans and a trust receipt of
the Custodian as to the Substitute Mortgage Loan or Loans.
The Servicer shall deposit in the Principal and Interest Account all
payments received in connection with such Qualified Substitute Mortgage Loan or
Loans after the date of such substitution; PROVIDED, HOWEVER, that any amounts
received after the date of substitution in respect of interest accrued on or
prior to the date of substitution on such Qualified Substitute Mortgage Loan
will constitute the property of the related Depositor or Originator, as the case
may be. Monthly Payments received with respect to Qualified Substitute Mortgage
Loans on or before the date of substitution will be retained by the Servicer on
behalf of the related Depositor or related Originator, as the case may be. The
Trustee will own, for the benefit of the Certificateholders and the Certificate
Insurer, all payments received on the Deleted Mortgage Loan on or before the
date of substitution, and the Servicer on behalf of the Depositors or
Originator, as the case may be, shall thereafter be entitled to retain all
amounts subsequently received in respect of such Deleted Mortgage Loan. The
Servicer shall give written notice to the Trustee, the Representative and the
Certificate Insurer that such substitution has taken place and shall amend the
Mortgage Loan Schedule to reflect the removal of such Deleted Mortgage Loan from
the terms of this Agreement and the substitution of the Qualified Substitute
Mortgage Loan. Upon such substitution, such Qualified Substitute Mortgage Loan
or Loans shall be subject to the terms of this Agreement in all respects, and
the Depositors shall be deemed to have made with respect to such Qualified
Substitute Mortgage Loan or Loans, as of the date of substitution, the
covenants, representations and warranties set forth in SECTIONS 3.01 AND 3.02.
On the date of such substitution, the applicable Depositor or the applicable
Originator, as the case may be, will remit to the Servicer, and the Servicer
will deposit into the Principal and Interest Account, an amount equal to the
Substitution Adjustment, if any.
It is understood and agreed that the obligations of the Servicer set
forth in SECTIONS 2.06 AND 3.03 to cure, purchase or substitute or cause to be
cured, purchased or substituted for a defective Mortgage Loan as provided in
SECTIONS 2.06 AND 3.03 constitute the sole remedies of the Trustee, the
Certificate Insurer and the Certificateholders respecting a breach of the
foregoing representations and warranties.
Any cause of action against either of the Depositors or the Servicer
relating to or arising out of a defect in a Mortgage File as contemplated by
SECTION 2.06 or the breach of any representations and warranties made in
SECTIONS 3.01 OR 3.02 shall arise as to any Mortgage Loan upon the occurrence of
not less than all of the following events: (i) discovery of such defect or
breach by any party and notice thereof to the Servicer or notice thereof by the
Servicer to the Trustee and the Certificate Insurer, (ii) failure by the
Servicer to cure or cause to be cured such defect or breach or purchase or
substitute or cause to be purchased or substituted such Mortgage Loan as
specified above, and (iii) demand upon the Servicer by the Trustee or the
Certificate Insurer for all amounts payable in respect of such Mortgage Loan.
The party delivering such notice shall also deliver a copy thereof to the
Certificate Insurer.
The Trustee shall give prompt written notice to Moody's, S&P, the
Certificate Insurer and to each Certificateholder of any repurchase or
substitution made pursuant to this SECTION 3.03 or SECTION 2.06(B).
<PAGE>
ARTICLE IV
THE CERTIFICATES
Section 4.01 THE CERTIFICATES.
(a) The Class A-1F, Class A-2F, Class A-3F, Class A-4F, Class A-5F,
Class A-6F, Class A-7F, Class A-1A, Class X, Class R-I, Class R-II, Class R-III
and Class R-IV Certificates shall be substantially in the forms annexed hereto
as EXHIBITS B-1, B-2, B-3, B-4, B-5, B-6, B-7, B-8, B-9, B-10, B-11, B-12 and
B-13, respectively. The Class A Certificates shall be issued in minimum
denominations of $1,000 and in integral multiples of $1 in excess thereof. The
Class X Certificates shall be issued in minimum denominations of 25% Percentage
Interest and in integral multiples of 1% Percentage Interest in excess thereof.
The Class R-I, Class R-II, Class R-III and Class R-IV Certificates shall be
issued in a minimum denomination of 100% Percentage Interest. All Certificates
shall be executed by manual or facsimile signature on behalf of the Trustee by
at least one authorized officer and authenticated by the manual signature of an
authorized officer. Certificates bearing the signatures of individuals who were
at the time of the execution of the Certificates the authorized officers of the
Trustee shall bind the Trustee, notwithstanding that such individuals or any of
them have ceased to hold such offices prior to the delivery of such Certificates
or did not hold such offices at the date of such Certificates. All Certificates
issued hereunder shall be dated the date of their authentication.
(b) The Class A Certificates, upon original issuance, shall be
issued in the form of a typewritten Certificate or Certificates representing
Book-Entry Certificates, to be delivered to the Depository or, pursuant to the
Depository's instructions on behalf of the Depository to, and deposited with,
the Certificate Custodian. Such Class A Certificate or Certificates shall
initially be registered on the Certificate Register in the name of Cede & Co.,
the nominee of the initial Depository, and no Certificate Owner of a Class A
Certificate or Certificates shall receive a definitive Class A Certificate
representing such Certificate Owner's interest in such Class A Certificate,
except as provided in SECTION 4.01(C). Unless and until definitive fully
registered Class A Certificates (the "DEFINITIVE Certificates") shall have been
issued to Certificate Owners pursuant to SECTION 4.01(C):
(i) the provisions of this SECTION 4.01(B) shall be in full
force and effect;
(ii) the Certificate Registrar and the Trustee shall be entitled
to deal with the Depository for all purposes of this Agreement (including
the payment of principal of and interest on the Certificates and the
giving of instructions or directions hereunder) as the sole Holder of the
Class A Certificates, and shall have no obligation to the Certificate
Owners with respect thereto;
(iii) to the extent that the provisions of this SECTION 4.01(B)
conflict with any other provisions of this Agreement, the provisions of
this SECTION 4.01(B) shall control;
(iv) the rights of the Certificate Owners with respect to the
Class A Certificates shall be exercised only through the Depository and
shall be limited to those established by law and agreements between such
Certificate Owners and the Depository and/or the Depository Participants.
Unless and until Definitive Certificates are issued pursuant to SECTION
4.01(C), the initial Depository will make book-entry transfers among the
Depository Participants and receive and transmit payments of principal of
and interest on the Class A Certificates to such Depository Participants;
(v) whenever this Agreement requires or permits actions to be
taken based upon instructions or directions of Holders of Certificates
evidencing a specified aggregate Percentage Interest, the Depository shall
be deemed to represent such percentage only to the extent that it has
received instructions to such effect from Certificate Owners and/or
Depository Participants owning or representing, respectively, such
required aggregate Percentage Interest of Class A Certificates (taking
into account the proviso contained in the definition of
"Certificateholder" contained herein) and has delivered such instructions
to the Trustee; and
(vi) whenever a notice or other communication to the Class A
Certificateholders is required under this Agreement, unless and until
Definitive Certificates shall have been issued to Certificate Owners
pursuant to SECTION 4.01(C), the Trustee shall give all such notices and
communications specified herein to be given to Class A Certificateholders
to the Depository and shall have no further obligation to the Certificate
Owners of the Class A Certificates.
PROVIDED, HOWEVER, that the provisions of this SECTION 4.01(B) shall not be
applicable in respect of Class A Certificates issued to the Depositors. The
Depositors or the Trustee may set a record date for the purpose of determining
the identity of Holders of Class A Certificates entitled to vote or to consent
to any action by vote as provided in this Agreement;
(c) The Class X, Class R-I, Class R-II, Class R-III and Class R-IV
Certificates shall be issued in the form of Definitive Certificates. With
respect to the Class A Certificates, if (i) the Servicer advises the Trustee in
writing that the Depository is no longer willing or able to properly discharge
its responsibilities with respect to the Class A Certificates, and the Servicer
is unable to locate a qualified successor; (ii) the Servicer at its option
advises the Trustee in writing that it elects to terminate the book-entry system
through the Depository; or (iii) after the occurrence of a Servicer Default, a
Majority in Aggregate Voting Interest advise the Depository in writing that the
continuation of a book-entry system through the Depository is no longer in the
best interests of the Certificate Owners of the Class A Certificates, then the
Depository shall notify all Certificate Owners and the Trustee of the occurrence
of any such event and of the availability of Definitive Certificates to
Certificate Owners requesting the same. Upon surrender to the Trustee of the
typewritten Certificate or Certificates representing the Book-Entry Certificates
by the Depository, accompanied by registration instructions, the Trustee shall
execute and authenticate the Definitive Certificates in accordance with the
instructions of the Depository. Neither the Certificate Registrar nor the
Trustee shall be liable for any delay in delivery of such instructions and may
conclusively rely on, and shall be protected in relying on, such instructions.
Upon the issuance of Definitive Certificates, the Trustee shall recognize the
Holders of the Definitive Certificates as Certificateholders.
Section 4.02 REGISTRATION OF TRANSFER AND EXCHANGE OF CERTIFICATES.
(a) The Trustee shall cause to be kept at its office or agency in
Chicago, Illinois, or at its designated agent, a Certificate Register in which,
subject to such reasonable regulations as it may prescribe, it shall provide for
the registration of Certificates and of transfers and exchanges of Certificates
as herein provided. The Certificate Register shall contain the name, remittance
instructions, Class and Percentage Interest of each Certificateholder, as well
as the Series and the number in the Series.
(b) Except as provided in Section 4.02(c), no transfer, sale, pledge
or other disposition of a Class X, Class R-I, Class R-II, Class R-III or Class
R-IV Certificate shall be made unless such transfer, sale, pledge or other
disposition is exempt from the registration requirements of the Securities Act
of 1933, as amended (the "ACT"), and any applicable state securities laws or is
made in accordance with said Act and laws. In the event that a transfer of a
Class X, Class R-I, Class R-II, Class R-III or Class R-IV Certificate is to be
made under this Section 4.02(b), (i) the Depositors may direct the Trustee to
require an Opinion of Counsel acceptable to and in form and substance
satisfactory to the Trustee and the Depositors that such transfer shall be made
pursuant to an exemption, describing the applicable exemption and the basis
therefor, from said Act and laws or is being made pursuant to said Act and laws,
which Opinion of Counsel shall not be an expense of the Trustee, the Depositors
or the Servicer and (ii) the Trustee shall require the transferee to execute a
representation letter, substantially in the form of Exhibit M-2 hereto, and the
Trustee shall require the transferor to execute a representation letter,
substantially in the form of Exhibit M-3 hereto, each acceptable to and in form
and substance satisfactory to the Depositors and the Trustee certifying to the
Depositors and the Trustee the facts surrounding such transfer, which
representation letters shall not be an expense of the Trustee, the Depositors or
the Servicer, provided that such representation letter will not be required in
connection with any transfer of any such Certificate by the Depositors to an
affiliate of the Depositors. Any such Certificateholder desiring to effect such
transfer shall, and does hereby agree to, indemnify the Trustee, the Depositors,
the Certificate Insurer and the Servicer against any liability that may result
if the transfer is not so exempt or is not made in accordance with such
applicable federal and state laws.
(c) Transfers of Class X, Class R-I, Class R-II, Class R-III and
Class R-IV Certificates may be made in accordance with this Section 4.02(c) if
the prospective transferee of a Certificate provides the Trustee and the
Depositors with an investment letter substantially in the form of Exhibit M-4
attached hereto, which investment letter shall not be an expense of the Trustee,
the Depositors or the Servicer, and which investment letter states that, among
other things, such transferee is a "qualified institutional buyer" as defined
under Rule 144A. Such transfers shall be deemed to have complied with the
requirements of Section 4.02(b) hereof; provided, however, that no Transfer of
any of the Certificates may be made pursuant to this Section 4.02(c) by the
Depositors. Any such Certificateholder desiring to effect such transfer shall,
and does hereby agree to, indemnify the Trustee, the Depositors and the Servicer
against any liability that may result if the transfer is not so exempt or is not
made in accordance with such applicable federal and state laws.
(d) 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
execute all instruments of transfer and to do all other things necessary in
connection with any such sale, and the rights of each Person acquiring any
Ownership Interest in a Residual Certificate are expressly subject to the
following provisions:
(1) Each Person holding or acquiring any Ownership Interest in a
Residual Certificate shall be a Permitted Transferee and shall promptly notify
the Trustee of any change or impending change in its status as a Permitted
Transferee.
(2) In connection with any proposed Transfer of any Ownership
Interest in a Residual Certificate, the Trustee shall require delivery to it,
and shall not register the Transfer of any such Residual Certificate until its
receipt of, an affidavit and agreement (a "TRANSFER AFFIDAVIT AND AGREEMENT")
attached hereto as Exhibit M-1 from the proposed Transferee, in form and
substance satisfactory to the Trustee, representing and warranting, among other
things, that such Transferee is a Permitted Transferee, that it is not acquiring
its Ownership Interest in such Residual Certificate that is the subject of the
proposed Transfer as a nominee, trustee or agent for any Person that is not a
Permitted Transferee, that for so long as it retains its Ownership Interest in
such Residual Certificate, it will endeavor to remain a Permitted Transferee,
and that it has reviewed the provisions of this Section 4.02(d) and agrees to be
bound by them.
(3) Notwithstanding the delivery of a Transfer Affidavit and
Agreement by a proposed Transferee under clause (2) above, if 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.
(4) Each Person holding or acquiring any Ownership Interest in a
Residual Certificate shall agree (x) to require a Transfer Affidavit and
Agreement from any other Person to whom such Person attempts to transfer its
Ownership Interest in such Residual Certificate and (y) not to transfer its
Ownership Interest unless it provides a certificate (attached hereto as Exhibit
J) to the Trustee stating that, among other things, it has no actual knowledge
that such other Person is not a Permitted Transferee.
(5) The Trustee will register the Transfer of any Residual
Certificate only if it shall have received the Transfer Affidavit and Agreement
and all of such other documents as shall have been reasonably required by the
Trustee as a condition to such registration. In addition, no Transfer of a
Residual Certificate shall be made unless the Trustee shall have received a
representation letter from the Transferee of such Certificate to the effect that
such Transferee is not a Disqualified Non-United States Person and is not a
Disqualified Organization or an agent of either. Transfers of the Residual
Certificates to Disqualified Non-United States Persons and Disqualified
Organizations or their agents are prohibited.
(6) Any attempted or purported transfer of any Ownership Interest
in a Residual Certificate in violation of the provisions of this Section 4.02
shall be absolutely null and void and shall vest no rights in the purported
transferee. If any purported transferee shall become a Holder of a Residual
Certificate in violation of the provisions of this Section 4.02, then the last
preceding Permitted Transferee shall be restored to all rights as Holder thereof
retroactive to the date of registration of transfer of such Residual
Certificate. The Trustee shall notify the Depositors upon receipt of written
notice or discovery by a Responsible Officer that the registration of transfer
of a Residual Certificate was not in fact permitted by this Section 4.02.
Knowledge shall not be imputed to the Trustee with respect to an impermissible
transfer in the absence of such a written notice or discovery by a Responsible
Officer. The Trustee shall be under no liability to any Person for any
registration of transfer of a Residual Certificate that is in fact not permitted
by this Section 4.02 or for making any payments due on such Certificate to the
Holder thereof or taking any other action with respect to such Holder under the
provisions of this Agreement so long as the transfer was registered after
receipt of the related Transfer Affidavit and Transfer Certificate. The Trustee
shall be entitled, but not obligated to recover from any Holder of a Residual
Certificate that was in fact not a Permitted Transferee at the time it became a
Holder or, at such subsequent time as it became other than a Permitted
Transferee, all payments made on such Residual Certificate at and after either
such time. Any such payments so recovered by the Trustee shall be paid and
delivered by the Trustee to the last preceding Holder of such Certificate.
(e) The Trustee shall make available to the Internal Revenue Service
and those Persons specified by the REMIC Provisions, all information necessary
to compute any tax imposed as a result of the transfer of an ownership interest
in a Residual Certificate to any Person who is a Disqualified Organization or an
agent thereof, including the information regarding "excess inclusions" of such
Residual Certificates required to be provided to the Internal Revenue Service
and certain Persons as described in Treasury Regulations Sections 1.860D-1(b)(5)
and 1.860E-2(a)(5). The Trustee may charge and shall be entitled to reasonable
compensation for providing such information as may be required from those
Persons which may have had a tax imposed upon them as specified in this
paragraph for providing such information.
(f) No transfer of a Class X, Class R-I, Class R-II, Class R-III or
Class R-IV Certificate or any interest therein shall be made to any employee
benefit plan or other retirement arrangement, including individual retirement
accounts and annuities, Keogh plans and collective investment funds and separate
accounts in which such plans, accounts or arrangements are invested, that is
subject to the Employee Retirement Income Security Act of 1974, as amended
("ERISA"), or the Code (each, an "ERISA PLAN"), unless the prospective
transferee of such Certificate provides the Servicer and the Trustee with a
certification of facts and, at the prospective transferee's expense, an Opinion
of Counsel which establish to the satisfaction of the Servicer and the Trustee
that such transfer will not result in a violation of Section 406 of ERISA or
Section 4975 of the Code or cause the Servicer or the Trustee to be deemed a
fiduciary of such ERISA Plan or result in the imposition of an excise tax under
Section 4975 of the Code. In the absence of their having received the
certification of facts or Opinion of Counsel contemplated by the preceding
sentence, the Trustee and the Servicer shall require the prospective transferee
of any Class X, Class R-I, Class R-II, Class R-III or Class R-IV Certificate to
certify in the form of Exhibit M-2 or Exhibit M-4 that (A) it is neither (i) an
ERISA Plan nor (ii) a Person who is directly or indirectly purchasing such
Certificate on behalf of, as named fiduciary of, as trustee of, or with assets,
of an ERISA Plan or (B) in the case of the Class X Certificates, if the
prospective transferee is an insurance company, all funds used by such
transferee to purchase such Certificates will be funds held by it in an
"insurance company general account" (as such term is defined in Section V(e) of
Prohibited Transaction Class Exemption 95-60 ("PTE 95-60"), 60 Fed. Reg. 35925
(July 12, 1995) and there is no ERISA Plan with respect to which the amount of
such general account's reserves and liabilities for the contract(s) held by or
on behalf of such ERISA Plan and all other ERISA Plans maintained by the same
employer (or affiliate thereof as defined in Section V(a)(1) of PTE 95-60) or by
the same employee organization exceeds 10% of the total of all reserves and
liabilities of such general account (as such amounts are determined under
Section I(a) of PTE 95-60) at the date of acquisition.
(g) Subject to the restrictions set forth in this Agreement, upon
surrender for registration of transfer of any Certificate at the office or
agency of the Trustee located in New York, New York or Chicago Illinois, the
Trustee shall execute, authenticate and deliver in the name of the designated
transferee or transferees, a new Certificate of the same Class and Percentage
Interest and dated the date of authentication by the Trustee. The Trustee shall
notify the Servicer of any such transfer. At the option of the
Certificateholders, Certificates may be exchanged for other Certificates of
Authorized Denominations of a like aggregate Percentage Interest, upon surrender
of the Certificates to be exchanged at such office. Whenever any Certificates
are so surrendered for exchange, the Trustee shall execute, authenticate and
deliver the Certificates which the Certificateholder making the exchange is
entitled to receive. No service charge shall be made for any transfer or
exchange of Certificates, but the Trustee may require payment of a sum
sufficient to cover any tax or governmental charge that may be imposed in
connection with any transfer or exchange of Certificates. All Certificates
surrendered for transfer and exchange shall be canceled by the Trustee.
Section 4.03 MUTILATED, DESTROYED, LOST OR STOLEN CERTIFICATES.
If (i) any mutilated Certificate is surrendered to the Trustee, or
the Trustee receives evidence to its satisfaction of the destruction, loss or
theft of any Certificate, and (ii) there is delivered to the Servicer and the
Trustee such security or indemnity, which may include a letter of indemnity
delivered by an insurance company reasonably acceptable to the Trustee and the
Servicer, as may be required by each of them to save each of them harmless,
then, in the absence of notice to the Servicer and the Trustee that such
Certificate has been acquired by a bona fide purchaser, the Trustee shall
execute, authenticate and deliver, in exchange for or in lieu of any such
mutilated, destroyed, lost or stolen Certificate, a new Certificate of like
tenor and Percentage Interest, but bearing a number not contemporaneously
outstanding. Upon the issuance of any new Certificate under this SECTION 4.03,
the Servicer and the Trustee may require the payment of a sum sufficient to
cover any tax or other governmental charge that may be imposed in relation
thereto and any other expenses connected therewith. Any duplicate Certificate
issued pursuant to this SECTION 4.03 shall constitute complete and indefeasible
evidence of ownership in the Trust, as if originally issued, whether or not the
mutilated, destroyed, lost or stolen Certificate shall be found at any time.
Section 4.04 PERSONS DEEMED OWNERS.
Prior to due presentation of a Certificate for registration of
transfer, the Servicer, the Depositors and the Trustee may treat the Person in
whose name any Certificate is registered as the owner of such Certificate for
the purpose of receiving remittances pursuant to SECTION 6.05 and for all other
purposes whatsoever, and the Servicer, the Depositors and the Trustee shall not
be affected by notice to the contrary.
Section 4.05 DETERMINATION OF LIBOR.
(a) On each LIBOR Determination Date, the Trustee shall determine
LIBOR on the basis of the British Bankers' Association "Interest Settlement
Rate" for one-month deposits in U.S. dollars as found on Telerate page 3750 as
of 11:00 A.M. London time on such LIBOR Determination Date. As used herein,
"Telerate page 3750" means the display designated as page 3750 on the Dow Jones
Telerate Service. If such rate does not appear on Telerate Page 3750, the rate
for that date will be determined on the basis of the rates at which one-month
United States dollars are offered by the Reference Banks at approximately 11:00
a.m., London time, on that day to prime banks in the London interbank market.
The Trustee will request the principal London office of each of the Reference
Banks to provide a quotation of its rate. If at least two such quotations are
provided, the rate for that date will be the arithmetic mean of the quotations.
If fewer than two quotations are provided as requested, the rate for that date
will be the arithmetic mean of the rates quoted by major banks in New York City,
selected by the Servicer, at approximately 11:00 a.m., New York City time, on
that day for one-month loans in United States dollars to leading European banks.
(b) The Class A-1A Pass-Through Rate applicable to the then current
and the immediately preceding Accrual Period may be obtained by any Class A-1A
Certificateholder, by telephoning the Trustee at its Corporate Trust Office at
1-800-934-6802.
(c) On each LIBOR Determination Date, the Trustee shall send to the
Servicer by facsimile notification of LIBOR for the following Accrual Period.
ARTICLE V
ADMINISTRATION AND SERVICING OF THE MORTGAGE LOANS
Section 5.01 DUTIES OF THE SERVICER.
(a) It is intended that each Trust REMIC formed hereunder shall
constitute, and that the affairs of each Trust REMIC shall be conducted so as to
qualify it as a REMIC as defined in and in accordance with the REMIC Provisions.
In furtherance of such intention, the Servicer covenants and agrees that it
shall not knowingly or intentionally take any action or omit to take any action
that would cause the termination of the REMIC status of any Trust REMIC.
(b) The Servicer, as independent contract servicer, shall service
and administer the Mortgage Loans and shall have full power and authority,
acting alone, to do any and all things in connection with such servicing and
administration which the Servicer may deem necessary or desirable and consistent
with the terms of this Agreement. The Servicer may enter into Subservicing
Agreements for any servicing and administration of Mortgage Loans with any
entity which is in compliance with the laws of each state necessary to enable it
to perform its obligations under such Subservicing Agreement and (x) has been
designated an approved Seller-Servicer by FHLMC or FNMA for first and second
mortgage loans, or (y) is an affiliate or wholly owned subsidiary of the
Servicer. The Servicer shall give notice to the Depositors, the Trustee and the
Certificate Insurer of the appointment of any Subservicer other than a
Subservicer which is an affiliate or wholly-owned subsidiary of the Servicer.
Any such Subservicing Agreement shall be consistent with and not violate the
provisions of this Agreement. The Servicer shall be entitled to terminate any
Subservicing Agreement in accordance with the terms and conditions of such
Subservicing Agreement and either itself directly service the related Mortgage
Loans or enter into a Subservicing Agreement with a successor subservicer which
qualifies hereunder.
(c) Notwithstanding any Subservicing Agreement, any of the
provisions of this Agreement relating to agreements or arrangements between the
Servicer and Subservicer or reference to actions taken through a Subservicer or
otherwise, the Servicer shall remain obligated and primarily liable to the
Depositors, the Trustee, the Certificate Insurer and the Certificateholders for
the servicing and administering of the Mortgage Loans in accordance with the
provisions of this Agreement without diminution of such obligation or liability
by virtue of such Subservicing Agreements or arrangements or by virtue of
indemnification from the Subservicer and to the same extent and under the same
terms and conditions as if the Servicer alone were servicing and administering
the Mortgage Loans. For purposes of this Agreement, the Servicer shall be deemed
to have received payments on Mortgage Loans when the Subservicer has received
such payments. The Servicer shall be entitled to enter into any agreement with a
Subservicer for indemnification of the Servicer by such Subservicer, and nothing
contained in this Agreement shall be deemed to limit or modify such
indemnification or limit or modify indemnification provided by the Servicer
herein.
(d) Any Subservicing Agreement that may be entered into and any
transactions or services relating to the Mortgage Loans involving a Subservicer
in its capacity as such and not as an Originator shall be deemed to be between
the Subservicer and the Servicer alone, and the Depositors, the Trustee, the
Certificate Insurer and Certificateholders shall not be deemed parties thereto
and shall have no claims, rights, obligations, duties or liabilities with
respect to the Subservicer except as set forth in SECTION 5.01(E).
(e) In the event the Servicer shall for any reason no longer be the
Servicer (including by reason of a Servicer Default), the Trustee or its
designee shall, subject to SECTION 10.02 hereof, thereupon assume all of the
rights and obligations of the Servicer under each Subservicing Agreement that
the Servicer may have entered into, unless the Trustee elects to terminate any
Subservicing Agreement. If the Trustee does not terminate a Subservicing
Agreement, the Trustee, its designee or the successor servicer for the Trustee
shall be deemed to have assumed all of the Servicer's interest therein and to
have replaced the Servicer as a party to each Subservicing Agreement to the same
extent as if the Subservicing Agreements had been assigned to the assuming
party, except that the Servicer shall not thereby be relieved of any liability
or obligations under the Subservicing Agreements. The Servicer at its expense
and without right of reimbursement therefor, shall, upon request of the Trustee,
deliver to the assuming party all documents and records relating to each
Subservicing Agreement and the Mortgage Loans then being serviced and an
accounting of amounts collected and held by it and otherwise use its best
efforts to effect the orderly and efficient transfer of the Subservicing
Agreements to the assuming party.
(f) Consistent with the terms of this Agreement, the Servicer may
waive, modify or vary any term of any Mortgage Loan or consent to the
postponement of strict compliance with any such term or in any manner grant
indulgence to any Mortgagor if in the Servicer's determination such waiver,
modification, postponement or indulgence is not materially adverse to the
interests of the Depositors, the Certificateholders and the Certificate Insurer;
PROVIDED, HOWEVER, that (unless (x) the Mortgagor is in default with respect to
the Mortgage Loan, or such default is, in the judgment of the Servicer,
reasonably foreseeable and (y) with respect to any modification lowering the
Mortgage Interest Rate (or, with respect to any Mortgage Loan in the Adjustable
Rate Group, a modification to the method of determination which may result a
lower Mortgage Interest Rate) or effecting the forgiveness of any amount owed
under the Mortgage Note, or extending the final maturity date on such Mortgage
Loan, the Certificate Insurer has consented to such modification and notice of
such modification has been delivered to the Rating Agencies) the Servicer may
not permit any modification with respect to any Mortgage Loan that would change
the Mortgage Interest Rate, defer (except as permitted by SECTION 5.11) or
forgive the payment of any principal or interest (unless in connection with the
liquidation of the related Mortgage Loan), extend the final maturity date or
modify any other material term of the Mortgage Loan, unless such waiver,
modification, postponement or indulgence would not be considered to constitute
the acquisition by REMIC I of a new mortgage loan under Treasury Regulations
Section 1.860G-2(b). No costs incurred by the Servicer or any Subservicer in
respect of Servicing Advances shall, for the purposes of distributions to
Certificateholders, be added to the Principal Balance of the related Mortgage
Loan for purposes of this Agreement. Without limiting the generality of the
foregoing, and subject to the consent of the Certificate Insurer, the Servicer
shall continue, and is hereby authorized and empowered to execute and deliver on
behalf of the Trustee, all instruments of satisfaction or cancellation, or of
partial or full release, discharge and all other comparable instruments, with
respect to the Mortgage Loans and with respect to the Mortgaged Properties. If
reasonably required by the Servicer (as evidenced by an Officer's Certificate of
the Servicer to such effect delivered to the Trustee), the Trustee shall furnish
the Servicer with any powers of attorney and other documents necessary or
appropriate to enable the Servicer to carry out its servicing and administrative
duties under this Agreement.
Notwithstanding anything to the contrary contained herein, the
Servicer, in servicing and administering the Mortgage Loans, shall employ or
cause to be employed procedures (including collection, foreclosure and REO
Property management procedures) and exercise the same care that it customarily
employs and exercises in servicing and administering mortgage loans for its own
account, in accordance with accepted second mortgage servicing practices of
prudent lending institutions and giving due consideration to the Depositor's,
the Certificate Insurer's and Certificateholders' reliance on the Servicer.
Notwithstanding anything to the contrary contained herein, the
Servicer may reimburse itself for Servicing Advances pursuant to SECTION 5.04
and may pay all or a portion of any Servicing Advance out of excess amounts on
deposit in the Principal and Interest Account and held for future distribution
on the date such Servicing Advance is made; any excess amounts so used shall be
replaced by the Servicer by deposit to the Principal and Interest Account on or
before the next succeeding Determination Date.
(g) On and after such time as the Trustee receives the resignation
of, or notice of the removal of, the Servicer from its rights and obligations
under this Agreement, and with respect to any resignation pursuant to SECTION
9.04, after receipt of the Opinion of Counsel required pursuant to SECTION 9.04,
the Trustee or its designee shall assume all of the rights and obligations of
the Servicer, subject to SECTION 9.02 hereof. The Servicer shall, upon request
of the Trustee but at the expense of the Servicer, deliver to the Trustee all
documents and records relating to the Mortgage Loans and an accounting of
amounts collected and held by the Servicer and otherwise use its best efforts to
effect the orderly and efficient transfer of servicing rights and obligations to
the assuming party.
(h) The Servicer shall prepare, file and furnish all information
returns required to be provided under sections 6050H, 6050J and 6050P of Code in
respect of the Mortgage Loans, the Mortgaged Property and the REO Property.
Section 5.02 LIQUIDATION OF MORTGAGE LOANS.
In the event that any payment due under any Mortgage Loan and not
postponed pursuant to SECTION 5.01 is not paid when the same becomes due and
payable, or in the event the Mortgagor fails to perform any other covenant or
obligation under the Mortgage Loan and such failure continues beyond any
applicable grace period, the Servicer shall take such action as it shall deem in
its good faith business judgment to be in the best interest of the Depositors,
the Certificate Insurer and the Certificateholders and otherwise in accordance
with the accepted second mortgage servicing practices of prudent lending
institutions. The Servicer in accordance with the provisions of SECTION 5.10
shall foreclose upon or otherwise comparably effect the ownership in the name of
the Trustee for the benefit of the Certificateholders of Mortgaged Properties
relating to defaulted Mortgage Loans as to which no satisfactory arrangements
can be made for collection of delinquent payments; PROVIDED, HOWEVER, that the
Servicer shall not be obligated to foreclose in the event that the Servicer, in
its good faith reasonable business judgment, determines that it would not be in
the best interests of the Depositors, the Certificateholders or the Certificate
Insurer, which judgment shall be evidenced by an Officer's Certificate delivered
to the Trustee and the Certificate Insurer. In connection with such foreclosure
or other conversion, the Servicer shall exercise and use collection and
foreclosure procedures with the same degree of care and skill as it would
exercise or use under the circumstances in the conduct of its own affairs. Any
amounts advanced in connection with such foreclosure or other action shall
constitute "SERVICING ADVANCES."
After a Mortgage Loan has become a Liquidated Mortgage Loan, the
Servicer shall promptly prepare and forward to the Depositors, the Trustee and
the Certificate Insurer a Liquidation Report, in the form attached hereto as
EXHIBIT O, detailing the Liquidation Proceeds received from the Liquidated
Mortgage Loan, expenses incurred with respect thereto, and any loss incurred in
connection therewith.
Section 5.03 ESTABLISHMENT OF PRINCIPAL AND INTEREST ACCOUNT;
DEPOSITS IN PRINCIPAL AND INTEREST ACCOUNT.
(a) The Servicer, for the benefit of the Certificateholders and the
Certificate Insurer, as their interests may appear, shall (x) cause to be
established and maintained one or more Principal and Interest Accounts in the
name of the Trustee, which shall be Eligible Accounts, which may be
interest-bearing, titled "EQCC Home Equity Loan Trust 1999-3 Principal and
Interest Account", bearing an additional designation clearly indicating that the
funds deposited therein are held for the benefit of the Certificateholders or
(y) so long as EquiCredit is acting as Servicer and the conditions set forth in
clauses (b)(i), (ii) and (iii) below are met, cause to be maintained an account
for deposit of the amounts set forth below, which account is not required to be
an Eligible Account or invested in Permitted Investments and may be a commingled
account containing other Servicer funds, but which account shall otherwise be a
"Principal and Interest Account" for all purposes of this Agreement to the
extent of funds therein deposited pursuant to the terms of this Agreement. In
the event clause (y) is applicable, (i) the Servicer shall maintain separate
books and records with respect to allotments relating to this Agreement that are
deposited in such Principal and Interest Account and shall separately account
for all amounts relating to this Agreement that are deposited or withdrawn from
such account and (ii) amounts deposited in such Principal and Interest Account
may be used for any purposes, provided, that the Servicer shall cause all
payments required to be made under this Agreement from the Principal and
Interest Account to be paid. The Principal and Interest Accounts referred to in
clause (x) above shall be insured by the Bank Insurance Fund or the Savings
Association Insurance Fund of the FDIC, as the case may be, to the maximum
extent provided by law. The creation of any Principal and Interest Account
referred to in clause (x) shall be evidenced by a letter agreement in the form
of EXHIBIT P hereto. A copy of such letter agreement shall be furnished by the
Servicer to the Depositors, the Trustee and the Certificate Insurer. The
Servicer shall use reasonable efforts to deposit (without duplication) within
one Business Day, and shall in any event deposit within two Business Days of
receipt thereof, in the Principal and Interest Account and retain therein:
(i) all payments received on or after the Cut-off Date on account
of principal on the Mortgage Loans and all Principal Prepayments and
Curtailments collected on or after the Cut-off Date;
(ii) (a) all payments received on or after the Cut-off Date on
account of interest accrued on the Mortgage Loans on or after the Cut-off
Date and (b) Pre-Plan Interest Payments;
(iii) all Net Liquidation Proceeds;
(iv) all Insurance Proceeds;
(v)all Released Mortgaged Property Proceeds;
(vi) any amounts payable in connection with the purchase of any
Mortgage Loan and the amount of any Substitution Adjustment pursuant to
SECTIONS 2.06 AND 3.03;
(vii) any amount required to be deposited in the Principal and
Interest Account pursuant to SECTION 5.04, 5.07, 5.08 OR 5.10; and
(viii) all payments made by the Servicer pursuant to the final
paragraph of SECTION 5.01(F) to replace any amount withdrawn from the
Principal and Interest Account to make Servicing Advances.
In making the deposits set forth in clauses (i) through (viii)
(inclusive) above, the Servicer shall note in its records the respective amounts
deposited with respect to Fixed Rate Group 1, Fixed Rate Group 2 and the
Adjustable Rate Group. The foregoing requirements for deposit in the Principal
and Interest Account shall be exclusive, it being understood and agreed that,
without limiting the generality of the foregoing, with respect to each Mortgage
Loan, the Representative's Yield, amounts received on and after the Cut-off Date
in respect of interest accrued on the Mortgage Loans prior to the Cut-off Date
(other than amounts referred to in SECTION 5.03(II)(B)), the Servicing Fee, late
payment charges and assumption fees, to the extent permitted by SECTIONS 7.01
AND 7.03, Excess Proceeds, and any amounts received after the date of
substitution of a Qualified Substitute Mortgage Loan pursuant to SECTION 2.06 OR
3.03 in respect of interest accrued on such Qualified Substitute Mortgage Loan
on or prior to the date of substitution (except to the extent taken into account
in calculating the Substitution Adjustment with respect thereto), need not be
deposited by the Servicer in the Principal and Interest Account. Except as
permitted in Section 5.03(a) amounts on deposit in the Principal and Interest
Account shall be held uninvested or shall be invested by the Servicer in
Permitted Instruments. Any investment earnings on funds held in the Principal
and Interest Account shall be for the account of the Servicer. Any reference
herein to amounts on deposit in the Principal and Interest Account shall refer
to amounts net of such investment earnings.
(b) Notwithstanding clause (x) of SECTION 5.03(A), for so long as
EquiCredit is acting as the Servicer, the Servicer shall be permitted to make
deposits into an account of the type described in clause (y) of SECTION 5.03(A)
if the specific terms and conditions set forth below are satisfied and only for
so long as such terms and conditions are satisfied:
(i) there exists no Servicer Default;
(ii) if EquiCredit does not have a short term debt rating of at
least "A-1" from S&P and "P-1" from Moody's, a guaranty, letter of credit,
surety bond or other similar instrument is issued covering remittance to
the Collection Account of Collections received during any Due Period,
which instrument is acceptable to the Rating Agencies and the Certificate
Insurer and is issued by an entity which has a short-term debt or
certificate of deposit rating, as applicable, of at least "A-1" from S&P
and "P-1" from Moody's; and
(iii) EquiCredit, the Trustee, the Depositors and the Certificate
Insurer shall not have received any notice from S&P or Moody's that such
arrangement will result in a reduction or withdrawal of the then current
rating on the Certificates without regard to the Certificate Insurance
Policy by either S&P or Moody's.
(c) In the event that, at any time the conditions set forth in
SECTION 5.03(B) are not satisfied, the Servicer shall forthwith cause to be
established a Principal and Interest Account meeting the requirements of clause
(x) of SECTION 5.03(A), and the Servicer shall deposit therein all amounts then
on deposit in any account maintained by the Servicer pursuant to clause (y) of
SECTION 5.03(A) (such account, an "Ineligible Account") which were deposited in
the Ineligible Account pursuant to this Agreement.
Section 5.04 PERMITTED WITHDRAWALS FROM THE PRINCIPAL AND
INTEREST ACCOUNT.
The Servicer shall withdraw or cause to be withdrawn funds from the
Principal and Interest Account (or, so long as a Principal and Interest Account
is maintained pursuant to SECTION 5.03(A), note on its books that such funds are
no longer funds with respect to the Principal and Interest Account), for the
following purposes:
(i) to remit to the Trustee for deposit into the REMIC I
Distribution Account on the third Business Day prior to the Distribution
Date, the sum of the amounts set forth in SECTION 5.03 deposited in the
Principal and Interest Account during the related Due Period (excluding
any amounts not required to be deposited in the Principal and Interest
Account pursuant to SECTION 5.03 and excluding any amounts withdrawn by
the Servicer pursuant to CLAUSES (II), (III), (V), (VI), (VII) AND (X)
below as of the related Determination Date);
(ii) to reimburse itself for any accrued unpaid Servicing Fees,
for unreimbursed Servicing Advances and, with respect to any Advance made
by the Servicer from its own funds, any unreimbursed Advance; provided,
that any withdrawal of accrued unpaid Servicing Fees pursuant to this
SECTION 5.04(II) shall be used first by the Servicer to pay any amounts
due to the Trustee pursuant to this Agreement. The Servicer's right to
reimbursement for unpaid Servicing Fees and unreimbursed Servicing
Advances shall be limited to late collections on the related Mortgage
Loan, including Liquidation Proceeds, Released Mortgaged Property
Proceeds, Insurance Proceeds and such other amounts as may be collected by
the Servicer from the related Mortgagor or otherwise relating to the
Mortgage Loan in respect of which such unreimbursed Advances are owed. The
Servicer's rights to reimbursement for any unreimbursed Advances shall be
limited to collections of interest on any Mortgage Loan with respect to
which an Advance was made or from late collections on such Mortgage Loans,
including Liquidation Proceeds, Released Mortgaged Property Proceeds,
Insurance Proceeds and such other amounts as may be collected by the
Servicer from the related Mortgagors or otherwise relating to the Mortgage
Loans in respect of which such unreimbursed amounts are owed. It is
understood that the Servicer's right to reimbursement pursuant hereto
shall be prior to the rights of Certificateholders unless the
Representative is the Servicer and the Servicer or any Depositor or
Originator is required to purchase or substitute (or cause to be purchased
or substituted) a Mortgage Loan pursuant to SECTIONS 2.06 AND 3.03, in
which case the Servicer's right to such reimbursement shall be subsequent
to the deposit into the Principal and Interest Account of the purchase
price or Substitution Adjustment pursuant to such SECTIONS 2.06 AND 3.03;
(iii) to withdraw any amount received from a Mortgagor that is
recoverable and sought to be recovered as a voidable preference by a
trustee in bankruptcy pursuant to the United States Bankruptcy Code in
accordance with a final, nonappealable order of a court having competent
jurisdiction;
(iv) (a) to make investments in Permitted Instruments and (b)
after effecting the remittance to the Trustee as provided in SECTION
5.04(I), to pay to itself interest earned in respect of Permitted
Instruments or on funds deposited in the Principal and Interest Account;
(v)to withdraw any funds deposited in the Principal and Interest
Account that were not required to be deposited therein (such as Servicing
Compensation) or were deposited therein in error;
(vi) to pay itself Servicing Compensation pursuant to SECTION
7.03 hereof to the extent not retained or paid pursuant to SECTION 5.03;
(vii) to withdraw funds necessary for the conservation and
disposition of REO Property pursuant to the third paragraph of SECTION
5.10 hereof to the extent such funds were deposited in the Principal and
Interest Account;
(viii) to utilize any excess funds on deposit to make any Advance
pursuant to SECTION 6.08 or any Servicing Advance pursuant to the final
paragraph of SECTION 5.01(F);
(ix) to clear and terminate the Principal and Interest Account
upon the termination of this Agreement and allocate the amounts therein
pursuant to the priority set forth in SECTION 6.05(D); and
(x)to effect, with respect to a Bankruptcy Loan, the remittance
to the Depositor transferring such Bankruptcy Loan, of an amount equal to
the excess, if any, of (a) Pre-Plan Interest Payments collected in the
preceding Due Period with respect to such Bankruptcy Loan over (b) the
interest accrued in such preceding Due Period, but uncollected as of the
last day of such Due Period, with respect to such Bankruptcy Loan.
In making the withdrawals set forth in clauses (i) through (x)
(inclusive) above, the Servicer shall note (when applicable) in its records the
respective amounts withdrawn with respect to Fixed Rate Group 1 and Fixed Rate
Group 2 and the Adjustable Rate Group. So long as no Servicer Default shall have
occurred and be continuing, the funds held in the Principal and Interest Account
may be invested by the Servicer (to the extent practicable) in Permitted
Instruments, as directed in writing to the Trustee by the Servicer. In either
case, funds in the Principal and Interest Account must be available for
withdrawal without penalty, and any Permitted Instruments must mature not later
than the Business Day immediately preceding the day on which such funds are to
be remitted to the Trustee for deposit in the Collection Account, but in no
event later than the Business Day immediately preceding the Determination Date
next following the date of such investment (except, in each case, that if such
Permitted Instrument is an obligation of the institution that maintains the
Principal and Interest Account, then such Permitted Instrument shall mature not
later than such Determination Date) and shall not be sold or disposed of prior
to its maturity. All Permitted Instruments in which funds in the Principal and
Interest Account are invested must be held by or registered in the name of the
Trustee. All interest or other earnings from funds on deposit in the Principal
and Interest Account (or any Permitted Instruments thereof) shall be the
exclusive property of the Servicer, and may be withdrawn from the Principal and
Interest Account pursuant to CLAUSE (IV) above. The amount of any losses
incurred in connection with the investment of funds in the Principal and
Interest Account in Permitted Instruments shall be deposited in the Principal
and Interest Account by the Servicer from its own funds immediately as realized
without reimbursement therefor.
Section 5.05 PAYMENT OF TAXES, INSURANCE AND OTHER CHARGES.
With respect to each Mortgage Loan, the Servicer shall maintain
accurate records reflecting fire and hazard insurance coverage.
With respect to each Mortgage Loan as to which the Servicer
maintains escrow accounts, the Servicer shall maintain accurate records
reflecting the status of ground rents, property taxes and assessments, water
rates and other charges which are or may become a lien upon the Mortgaged
Property and the status of primary mortgage guaranty insurance premiums, if any,
and fire and hazard insurance coverage and shall obtain, from time to time, all
bills for the payment of such charges (including renewal premiums) and shall
effect payment thereof prior to the applicable penalty or termination date and
at a time appropriate for securing maximum discounts allowable, employing for
such purpose deposits of the Mortgagor in any escrow account which shall have
been estimated and accumulated by the Servicer in amounts sufficient for such
purposes, as allowed under the terms of the Mortgage. To the extent that a
Mortgage does not provide for escrow payments, the Servicer shall monitor such
payments to determine if they are made by the Mortgagor at the time they become
due and, if not paid by the Mortgagor, shall advance such amounts as Servicing
Advances. To the extent ground lease payments are not made by the Mortgagor, and
the Servicer has notice of such failure to pay, the Servicer shall advance such
delinquent payments. Any out-of-pocket expenses incurred by the Servicer
pursuant to this SECTION 5.05 shall constitute Servicing Advances.
Section 5.06 TRANSFER OF ACCOUNTS; MONTHLY STATEMENTS.
The Accounts (other than the Principal and Interest Account, which
shall be established pursuant to Section 5.03 hereof) shall be established, as
of the Closing Date, in the name of the Trustee as Eligible Accounts pursuant to
clause (B) of the definition thereof. Any Account may, upon written notice from
the Servicer to the Trustee, be transferred to a different depository
institution so long as (i) such transfer (A) is to an Eligible Account and the
Certificate Insurer receives notice thereof from the Servicer or (B) is approved
in writing by the Certificate Insurer, which approval shall not be unreasonably
withheld and (ii) written notice of such transfer is sent to the Rating
Agencies. The Trustee shall provide to the Certificate Insurer a monthly
statement of activity in the Accounts established by it, and the Servicer shall
provide to the Trustee and the Certificate Insurer a monthly statement of
activity in the Principal and Interest Account from the party holding such
account.
Section 5.07 MAINTENANCE OF HAZARD INSURANCE.
The Servicer shall cause each Mortgagor to maintain, and if the
Mortgagor does not so maintain, shall itself maintain, subject to the provisions
of SECTION 5.08 hereof, fire and hazard insurance with extended coverage
customary in the area where the Mortgaged Property is located, in an amount
which is at least equal to the least of (a) the outstanding principal balance
owing on the Mortgage Loan (and any prior lien if the related Mortgage Loan is
in a junior lien position), (b) the full insurable value of the Mortgaged
Property securing the Mortgage Loan and (c) the minimum amount required to
compensate for damage or loss on a replacement cost basis. If the Mortgaged
Property is in an area identified in the Federal Register by the Federal
Emergency Management Agency as Flood Zone "A", and such flood insurance has been
made available, the Servicer will cause to be purchased a flood insurance policy
with a generally acceptable insurance carrier, in an amount representing
coverage not less than the least of (i) the outstanding principal balance of the
Mortgage Loan (plus the principal balance of any lien having priority over the
Mortgage Loan), (ii) the full insurable value of the Mortgaged Property, or
(iii) the maximum amount of insurance available under the National Flood
Insurance Act of 1968, as amended. The Servicer shall also maintain on REO
Property, to the extent reasonably available, on REO Property, fire and hazard
insurance in the amounts described above, liability insurance and, to the extent
required and available under the National Flood Insurance Act of 1968, as
amended, and the Servicer determines that such insurance is necessary in
accordance with accepted second mortgage servicing practices of prudent lending
institutions, flood insurance in an amount equal to that required above. Any
amounts collected by the Servicer under any such policies (other than amounts to
be applied to the restoration or repair of the Mortgaged Property, or to be
released to the Mortgagor in accordance with customary second mortgage servicing
procedures) shall be deposited in the Principal and Interest Account, subject to
(X) retention by the Servicer to the extent such amounts constitute Servicing
Compensation or (Y) withdrawal pursuant to SECTION 5.04. It is understood and
agreed that no earthquake or other additional insurance need be required by the
Servicer of any Mortgagor or maintained on REO Property, other than pursuant to
such applicable laws and regulations as shall at any time be in force and as
shall require such additional insurance. All policies required hereunder shall
be endorsed with standard mortgagee clauses with losses payable to the Servicer.
Any out-of-pocket expenses incurred by the Servicer pursuant to this SECTION
5.07, including, without limitation, any advances of premiums on insurance
policies required by this SECTION 5.07, shall constitute Servicing Advances.
Section 5.08 MAINTENANCE OF MORTGAGE IMPAIRMENT INSURANCE
POLICY.
In the event that the Servicer shall obtain and maintain a blanket
policy insuring against fire and hazards of extended coverage on all of the
Mortgage Loans as to which the Mortgagor does not maintain the insurance
described in Section 5.07, then, to the extent such policy names the Servicer as
loss payee and provides coverage in an amount equal to the aggregate unpaid
principal balance on the Mortgage Loans without co-insurance, and otherwise
complies with the requirements of SECTION 5.07, the Servicer shall be deemed
conclusively to have satisfied its obligations with respect to fire and hazard
insurance coverage under SECTION 5.07, it being understood and agreed that such
blanket policy may contain a deductible clause, in which case the Servicer
shall, in the event that there shall not have been maintained on the related
Mortgaged Property a policy complying with SECTION 5.07, and there shall have
been a loss which would have been covered by such policy, deposit in the
Principal and Interest Account from the Servicer's own funds the difference, if
any, between the amount that would have been payable under a policy complying
with SECTION 5.07 and the amount paid under such blanket policy. Upon the
request of the Certificate Insurer or the Trustee, the Servicer shall cause to
be delivered to such requesting Person a certified true copy of such policy.
Section 5.09 FIDELITY BOND.
The Servicer shall maintain with a responsible company, at its own
expense, a blanket fidelity bond and an errors and omissions insurance policy in
a minimum amount acceptable to FNMA or FHLMC or otherwise as is commercially
available at a cost that is not generally regarded as excessive by industry
standards, with broad coverage on all officers, employees or other persons
acting in any capacity requiring such persons to handle funds, money, documents
or papers relating to the Mortgage Loans ("SERVICER Employees"). Any such
fidelity bond and errors and omissions insurance shall protect and insure the
Servicer against losses, including losses resulting from forgery, theft,
embezzlement, fraud, errors and omissions and negligent acts of such Servicer
Employees. Such fidelity bond shall also protect and insure the Servicer against
losses in connection with the release or satisfaction of a Mortgage Loan without
having obtained payment in full of the indebtedness secured thereby. No
provision of this SECTION 5.09 requiring such fidelity bond and errors and
omissions insurance shall diminish or relieve the Servicer from its duties and
obligations as set forth in this Agreement. Upon the request of the Trustee or
the Certificate Insurer, the Servicer shall cause to be delivered to such
requesting Person a certified true copy of such fidelity bond and errors and
omissions insurance policy. On the Closing Date, such fidelity bond and errors
and omissions insurance policy is maintained with certain underwriters at
National Union Fire Insurance Company of Pittsburgh, Pa.
Section 5.10 TITLE, MANAGEMENT AND DISPOSITION OF REO PROPERTY.
In the event that title to the Mortgaged Property is acquired in
foreclosure or by deed in lieu of foreclosure (an "REO PROPERTY"), the deed or
certificate of sale shall be taken in the name of the Trustee for the benefit of
the Certificateholders.
The Servicer shall manage, conserve, protect and operate each REO
Property for the Certificateholders and the Certificate Insurer solely for the
purpose of its prudent and prompt disposition and sale. The Servicer shall,
either itself or through an agent selected by the Servicer, manage, conserve,
protect and operate the REO Property in the same manner that it manages,
conserves, protects and operates for its own account similar property in the
same locality as the REO Property is managed. The Servicer shall attempt to sell
the same (and may temporarily rent the same) on such terms and conditions as the
Servicer deems to be in the best interests of the Certificate Insurer and the
Certificateholders. Any out-of-pocket expenses incurred by the Servicer pursuant
to this SECTION 5.10 shall constitute Servicing Advances. The Servicer shall
cause the Trustee to be named as a beneficiary and loss payee under the REO
liability provisions of the Servicer's general comprehensive liability insurance
policy.
The Servicer shall cause to be deposited in the Principal and
Interest Account all revenues received with respect to the conservation and
disposition of the related REO Property and shall retain or withdraw therefrom
funds necessary for the proper operation, management and maintenance of the REO
Property and the fees of any managing agent acting on behalf of the Servicer.
The disposition of REO Property shall be carried out by the Servicer
at such price, and upon such terms and conditions, as the Servicer deems to be
in the best interest of the Certificateholders and the Certificate Insurer and,
as soon as practicable thereafter, the expenses of such sale shall be paid. The
proceeds of sale of the REO Property and other proceeds of any REO Disposition
shall be deposited in the Principal and Interest Account, net of related
liquidation expenses, Excess Proceeds, any related unreimbursed Servicing
Advances, accrued and unpaid Servicing Fees and unreimbursed Advances payable to
the Servicer in accordance with SECTION 5.04(II).
In the event any Mortgaged Property is acquired as aforesaid or
otherwise in connection with a default or imminent default on a Mortgage Loan,
the Servicer shall dispose of such Mortgaged Property prior to the close of the
third calendar year beginning after the year of its acquisition (the
"Disposition Period) unless (i) the Servicer shall have received an Opinion of
Counsel to the effect that the holding of such Mortgaged Property subsequent to
the Disposition Period will not result in the imposition of taxes on "prohibited
transactions" as defined in Section 860F of the Code or cause any Trust REMIC to
fail to qualify as a REMIC at any time that any Class A or Class X Certificates
are outstanding or (ii) the Servicer shall have applied for, at least 60 days
prior to the expiration of such period, an extension of such period in the
manner contemplated by Section 856(e)(3) of the Code, in which case the original
period shall be extended by the applicable period. Notwithstanding any other
provision of this Agreement, (i) no Mortgaged Property acquired by the Servicer
pursuant to this Section shall be rented (or allowed to continue to be rented)
or otherwise used for the production of income or by or on behalf of the Trust
Fund, and (ii) no construction shall take place on such Mortgaged Property if
such activity as described in the preceding clause (i) or clause (ii) is
conducted or otherwise undertaken in such a manner or pursuant to any terms that
would cause such Mortgaged Property to fail to qualify as "foreclosure property"
within the meaning of Section 860G(a)(8) of the Code or result in the receipt by
any Trust REMIC of any "net income from foreclosure property" which is subject
to taxation within the meaning of Sections 860G(c) and 857(b)(4)(B) of the Code.
If a period greater than the Disposition Period is permitted under this
Agreement and is necessary to sell any REO Property, the Servicer shall give
appropriate notice to the Trustee, the Certificate Insurer and the
Certificateholders and shall report monthly to the Trustee as to the progress
being made in selling such REO Property.
If the Servicer has actual knowledge that a Mortgaged Property which
the Servicer is contemplating acquiring in foreclosure or by deed in lieu of
foreclosure is located within a 1 mile radius of any site with material
environmental or hazardous waste risks known to the Servicer, the Servicer will
notify the Certificate Insurer and the Trustee prior to acquiring the Mortgaged
Property and shall not take any action without the prior written approval of the
Certificate Insurer and the Trustee.
Nothing in this Section shall affect the Servicer's right to deem
certain advances proposed to be made Nonrecoverable Advances. For the purpose of
this SECTION 5.10, actual knowledge of the Servicer means actual knowledge of a
Responsible Officer of the Servicer involved in the servicing of the relevant
Mortgage Loan. Actual knowledge of the Servicer does not include knowledge
imputable by virtue of the availability of or accessibility to information
relating to environmental or hazardous waste sites or the locations thereof.
Section 5.11 COLLECTION OF CERTAIN MORTGAGE LOAN PAYMENTS.
The Servicer shall make reasonable efforts to collect all payments
called for under the terms and provisions of the Mortgage Loans, and shall, to
the extent such procedures shall be consistent with this Agreement, comply with
the terms and provisions of any applicable hazard insurance policy. Consistent
with the foregoing, the Servicer may in its discretion waive or permit to be
waived any late payment charge, prepayment charge, assumption fee or any penalty
interest in connection with the prepayment of a Mortgage Loan or any other fee
or charge which the Servicer would be entitled to retain hereunder as Servicing
Compensation and extend the due date for payments due on a Mortgage Note for a
period (with respect to each payment as to which the due date is extended) not
greater than 125 days after the initially scheduled due date for such payment,
provided that such extension may only be made once in any twelve month period
without the prior written consent of the Certificate Insurer, which consent
shall not be unreasonably withheld. In the event the Servicer shall consent to
the deferment of the Due Dates for payments due on a Mortgage Note, the Servicer
shall nonetheless remit any required Advance in accordance with SECTION 6.08
hereof with respect to the payments so extended to the same extent as if such
installment were due, owing and delinquent and had not been deferred.
Section 5.12 ACCESS TO CERTAIN DOCUMENTATION AND INFORMATION
REGARDING THE MORTGAGE LOANS.
The Servicer and the Depositors shall provide to the Trustee, the
Certificateholders, the Certificate Insurer, the Federal Reserve and to the
supervisory agents and examiners of each of the foregoing, access to the
documentation regarding the Mortgage Loans (such access in the case of the
supervisory agents and examiners shall be limited to that required by applicable
state and federal regulations), such access being afforded without charge but
only upon reasonable request and during normal business hours at the offices of
the Servicer designated by it.
Section 5.13 SUPERIOR LIENS.
The Servicer shall file (or cause to be filed) of record a request
for notice of any action by a superior lienholder under a First Lien for the
protection of the Depositor's and the Trustee's interest, where permitted by
local law and whenever applicable state law does not require that a junior
lienholder be named as a party defendant in foreclosure proceedings in order to
foreclose such junior lienholder's equity of redemption. The Servicer shall also
notify any superior lienholder in writing of the existence of the Mortgage Loan
and request notification of any action (as described below) to be taken against
the Mortgagor or the Mortgaged Property by the superior lienholder.
If the Servicer is notified that any superior lienholder has
accelerated or intends to accelerate the obligations secured by the First Lien,
or has declared or intends to declare a default under the mortgage or the
promissory note secured thereby, or has filed or intends to file an election to
have the Mortgaged Property sold or foreclosed, the Servicer shall advance the
necessary funds to cure the default or reinstate the superior lien, if such
advance is in the best interests of the Depositors, the Certificate Insurer and
the Certificateholders. The Servicer shall not make such an advance except to
the extent that it determines in its reasonable good faith judgment that the
advance would be recoverable from Liquidation Proceeds on the related Mortgage
Loan. The Servicer shall thereafter take such action as is necessary to recover
the amount so advanced.
<PAGE>
ARTICLE VI
PAYMENTS TO THE CERTIFICATEHOLDERS
Section 6.01 ESTABLISHMENT OF COLLECTION ACCOUNTS; DEPOSIT
IN ACCOUNTS.
(a) No later than the Closing Date, the Trustee, for the benefit of
the Certificateholders and the Certificate Insurer, as their interests may
appear, shall establish and maintain (i) the REMIC I Distribution Account in the
name of the Trustee, in trust for the benefit of Certificateholders and the
Trustee as the Holder of the REMIC I Regular Interests; (ii) the REMIC II
Distribution Account in the name of the Trustee, in trust for the benefit of
Certificateholders and the Trustee as the Holder of the REMIC II Regular
Interests; (iii) the REMIC III Distribution Account in the name of the Trustee,
in trust for the benefit of Certificateholders and the Trustee as the Holder of
the REMIC III Regular Interests; and (iv) the REMIC IV Distribution Account in
the name of the Trustee, in trust for the benefit of Certificateholders. Each of
the REMIC I Distribution Account, the REMIC II Distribution Account, the REMIC
III Distribution Account and the REMIC IV Distribution Account shall be
established and maintained as an Eligible Account. Notwithstanding the
foregoing, however, the Trustee may establish a single account (the "COLLECTION
ACCOUNT"), of which the REMIC I Distribution Account, the REMIC II Distribution
Account, the REMIC III Distribution Account and REMIC IV Distribution Account
will be deemed to be subaccounts, provided that: (i) the Collection Account
shall be established and maintained in the name of the Trustee, in trust for the
benefit of Certificateholders, (ii) the Collection Account shall be established
and maintained as an Eligible Account and (iii) the Trustee shall for all other
purposes hereunder treat the REMIC I Distribution Account, the REMIC II
Distribution Account, the REMIC III Distribution Account and REMIC IV
Distribution Account as separate accounts, and shall keep accurate records with
respect thereto.
The Trustee shall, promptly upon receipt, deposit in the REMIC I
Distribution Account and retain therein:
(i) the amounts remitted by the Servicer pursuant to SECTION
5.04(I);
(ii) the Advances pursuant to SECTION 6.08 remitted to the
Trustee by the Servicer;
(iii) Insured Payments pursuant to SECTION 6.05(C); and
(iv) amounts required to be paid by the Servicer pursuant to
SECTION 6.04(E) in connection with losses on investments of amounts in the
Collection Account.
In making the deposits set forth in clauses (i) through (iv)
(inclusive) above, the Trustee shall note in its records (if applicable) the
respective amounts deposited with respect to Fixed Rate Group 1, Fixed Rate
Group 2 and the Adjustable Rate Group.
With respect to each Distribution Date, on or before such date the
Trustee shall make the withdrawals from the REMIC I Distribution Account, as set
forth in Section 6.05 hereof, shall make the deposits into the REMIC II
Distribution Account, as set forth in Section 6.05 hereof, shall make the
withdrawals from the REMIC II Distribution Account, as set forth in Section 6.05
hereof, shall make deposits into the REMIC III Distribution Account, as set
forth in Section 6.05 hereof, shall make the withdrawals from the REMIC III
Distribution Account, as set forth in Section 6.05 hereof, shall make the
deposits into the REMIC IV Distribution Account, as set forth in Section 6.05
hereof, and shall cause the amount of Available Funds and Insured Payments to be
distributed in respect of the Certificates pursuant to SECTION 6.05 hereof on
such date.
Section 6.02 PERMITTED WITHDRAWALS FROM REMIC I DISTRIBUTION
ACCOUNT, REMIC II DISTRIBUTION ACCOUNT, REMIC III DISTRIBUTION ACCOUNT AND REMIC
IV DISTRIBUTION ACCOUNT.
The Trustee shall withdraw amounts on deposit in the REMIC I
Distribution Account, the REMIC II Distribution Account, the REMIC III
Distribution Account and REMIC IV Distribution Account on each Distribution Date
(except as set forth in clause (ii) below) in the following order of priority:
(i) to make the distributions pursuant to SECTION 6.05(D) AND
SECTION 6.05(E); and
(ii) on any day during the related Accrual Period, and in
no particular order of priority:
(A) to invest amounts on deposit in the REMIC I Distribution
Account in Permitted Instruments or such other instruments as may be approved in
writing by the Certificate Insurer (with written notice to the Rating Agencies)
pursuant to SECTION 6.04;
(B) to pay to the Servicer interest paid and earnings realized on
Permitted Instruments with respect to funds in the REMIC I Distribution Account;
(C) to withdraw any amount deposited in the REMIC I Distribution
Account, the REMIC II Distribution Account, the REMIC III Distribution Account
or the REMIC IV Distribution Account not required to be deposited therein or
deposited therein in error;
(D) to withdraw any amount that constitutes an Advance by Servicer
of its own funds or a Mortgagor payment previously deposited into the REMIC I
Distribution Account that is held to constitute a voidable preference by a
trustee in bankruptcy pursuant to the United States Bankruptcy Code in
accordance with a final, nonappealable order of a court having competent
jurisdiction;
(E) to pay any unanticipated expense of the Trust Fund out of the
REMIC I Distribution Account and to pay any taxes imposed on REMIC I, REMIC II,
REMIC III or REMIC IV from the REMIC I Distribution Account, the REMIC II
Distribution Account, the REMIC III Distribution Account or the REMIC IV
Distribution Account, respectively, which are not otherwise paid pursuant to
Section 2.07(d); and
(F) to clear and terminate the REMIC I Distribution Account, the
REMIC II Distribution Account, the REMIC III Distribution Account and the REMIC
IV Distribution Account upon the termination of this Agreement and allocate
amounts therein pursuant to Section 6.05(d).
In making the withdrawals set forth in clauses (i) and (ii) above,
the Trustee shall note in its records (if applicable) the respective amounts
withdrawn with respect to Fixed Rate Group 1, Fixed Rate Group 2 and the
Adjustable Rate Group. In addition, the Trustee shall keep and maintain a
separate accounting for withdrawals from each of the REMIC I Distribution
Account, the REMIC II Distribution Account, the REMIC III Distribution Account
and the REMIC IV Distribution Account pursuant to each subclause listed above.
Section 6.03 ESTABLISHMENT OF INSURANCE ACCOUNT: DEPOSITS IN
INSURANCE ACCOUNT: PERMITTED WITHDRAWALS FROM INSURANCE ACCOUNT.
(a) No later than the Closing Date, the Trustee, for the benefit of
the Certificateholders and the Certificate Insurer, shall establish and maintain
one or more Eligible Accounts as trust accounts with itself which shall not be
interest-bearing, titled "EQCC Home Equity Loan Trust 1999-3 Insurance Account".
The Insurance Account shall bear an additional designation clearly indicating
that the funds deposited therein are held for the benefit of the
Certificateholders and the Certificate Insurer. On each Distribution Date, the
Trustee, upon receipt (and to the extent received), promptly shall deposit into
the Insurance Account, an amount equal to the aggregate Monthly Premium with
respect to the Class A Certificates due on such Distribution Date in accordance
with Section 6.05(d) and Section 6.05(e)(iv)(D).
(b) The Trustee may make withdrawals from the Insurance Account for
application in the following order:
(i) to pay the Certificate Insurer the aggregate Monthly
Premium on each Distribution Date; and
(ii) to withdraw amounts not required to be deposited in the
Insurance Account or deposited therein in error.
Section 6.04 INVESTMENT OF ACCOUNTS.
(a) So long as no Servicer Default shall have occurred and be
continuing, all or a portion of any Account (other than the REMIC II
Distribution Account, the REMIC III Distribution Account and the REMIC IV
Distribution Account) held by the Trustee shall be invested and reinvested by
the Trustee (or remain uninvested), as directed in writing by the Servicer on
its own behalf, in one or more Permitted Instruments (or, in the case of the
REMIC I Distribution Account, in such other instruments approved in writing by
the Certificate Insurer (with written notice to Moody's)) bearing interest or
sold at a discount. If a Servicer Default shall have occurred and be continuing,
the Trustee shall invest all Accounts in Permitted Instruments described in
PARAGRAPH (IV) of the definition of Permitted Instruments. At no time shall any
such investment in any Account mature later than the Business Day immediately
preceding the date on which such amounts are required by the terms hereof to be
withdrawn from such Account, which (i) in the case of the REMIC I Distribution
Account, shall be the next Distribution Date, (ii) in the case of the Principal
and Interest Account, shall be the third business day preceding the next
Distribution Date and (iii) in all other cases, until the day actually withdrawn
pursuant to the terms hereof.
(b) If any amounts are needed for disbursement from any Account held
by the Trustee and sufficient uninvested funds are not available to make such
disbursement, the Trustee shall cause to be sold or otherwise converted to cash
a sufficient amount of the investments in such Account. The Trustee shall not be
liable for any investment loss or other charge resulting therefrom unless the
Trustee's failure to perform in accordance with this SECTION 6.04 is the cause
of such loss or charge.
(c) Subject to SECTION 12.01 hereof, the Trustee shall not in any
way be held liable by reason of any insufficiency in any Account held by the
Trustee resulting from any investment loss on any Permitted Instrument (or other
instrument permitted by SECTION 6.04(A)) included herein (except to the extent
that the Trustee is the obligor and has defaulted thereon).
(d) The Trustee shall invest and reinvest funds in the Accounts held
by it, to the fullest extent practicable, in such manner as the Servicer shall
from time to time direct as set forth in SECTION 6.04(A), but only in one or
more Permitted Instruments (or other instrument permitted by SECTION 6.04(A)).
(e) All income or other gain from investments in any Account held by
the Trustee, or from amounts on deposit in such Account and invested in
Permitted Instruments, shall be deposited in such Account, as the case may be,
immediately on receipt, and the Trustee shall notify the Servicer of any loss
resulting from such investments. Upon receipt of such notification, the Servicer
shall promptly remit the amount of any such loss from its own funds, without
reimbursement therefor, to the Trustee for deposit in the Account from which the
related funds were withdrawn for investment.
(f) Any investment earnings on funds held in the Principal and
Interest Account may be reinvested by the Servicer and the proceeds of such
reinvestment are for the account of the Servicer.
Section 6.05 PRIORITY AND SUBORDINATION OF DISTRIBUTIONS.
(a) The rights of the Certificateholders to receive distributions
from the proceeds of the Trust Fund, and all ownership interests of the
Certificateholders in such distributions, shall be as set forth in this
Agreement. The rights of the Class X Certificateholders to receive distributions
in respect of the Class X Certificates shall be subject and subordinate to the
preferential rights of the Class A Certificateholders to receive distributions
in respect of the Class A Certificates, to the extent set forth herein.
Notwithstanding anything contained in this Agreement to the contrary, no
Certificateholder shall be required to refund any amount properly distributed to
it pursuant to SECTION 6.02 OR 6.05.
(b) [Reserved];
(c) As soon as possible, and in no event later than 10:00 a.m. New
York time on the Business Day immediately preceding each Distribution Date, the
Trustee shall furnish the Certificate Insurer and the Servicer with a completed
notice in the form set forth as Exhibit Q hereto (the "NOTICE) in the event that
(i) an Event of Nonpayment will occur, pursuant to the definition thereof, with
respect to such Distribution Date, (ii) the aggregate of the Certificate
Balances of a Certificate Group then outstanding (after giving effect to
principal distributions to be made pursuant to SECTION 6.05(D) on such
Distribution Date) would exceed the aggregate Principal Balance of the Mortgage
Loans then outstanding, (iii) without duplication of the notice specified in
clause (ii), the Certificate Balance of each Class of Class A Certificates
remains unpaid on the Final Scheduled Distribution Date for such Class, after
giving effect to distributions on such Distribution Date, (iv) such Distribution
Date is the dated fixed for termination of the Trust pursuant to Section 11.01
or (v) a Preference Amount exists. The Notice shall specify the amount of
Insured Payment and shall constitute a claim for an Insured Payment pursuant to
the Certificate Insurance Policy. In the case of a Preference Amount, such
Notice shall be accompanied by a certified copy of the order requiring the
return of a preference payment, and such other documentation as is required
pursuant to the terms of the Certificate Insurance Policy by the Certificate
Insurer, such documentation being in a form satisfactory to the Certificate
Insurer, provided that if such documents are received after 12:00 noon New York
City time on such Business Day, they will be deemed to be received on the
following Business Day. Upon receipt of Insured Payments for the benefit of the
Class A Certificateholders under the Certificate Insurance Policy, the Trustee
shall deposit such Insured Payments in the Collection Account.
The Trustee shall receive, as attorney-in-fact of each Holder of a
Class A Certificate, any Insured Payment from the Certificate Insurer and
disburse the same to each Holder of a Class A Certificate, respectively, in
accordance with the provisions of this SECTION 6.05. Insured Payments disbursed
by the Trustee from proceeds of the Certificate Insurance Policy shall not be
considered payment by the Trust Fund nor shall such payment discharge the
obligation of the Trust Fund with respect to such Class A Certificates, and the
Certificate Insurer shall become the owner of such unpaid amounts due from the
Trust Fund in respect of Class A Certificates. The Trustee hereby agrees on
behalf of each Holder of a Class A Certificate for the benefit of the
Certificate Insurer that it recognizes that to the extent the Certificate
Insurer makes Insured Payments, either directly or indirectly (as by paying
through the Trustee), to the Class A Certificateholders, the Certificate Insurer
will be subrogated to the rights of the Class A Certificateholders, as
applicable, with respect to such Insured Payment and shall be deemed to the
extent of the payments so made to be a registered Class A Certificateholder and
shall receive all future amounts distributable pursuant to SECTION 6.05(D) to
the Class A Certificates which received such Insured Payment, as the case may
be, until all such Insured Payments by the Certificate Insurer have been fully
reimbursed together with interest thereon at the applicable Pass-Through Rate.
To evidence such subrogation, the Trustee shall note the Certificate Insurer's
rights as subrogee on the registration books maintained by the Trustee upon
receipt from the Certificate Insurer of proof of payment of any Insured Payment.
Except as otherwise described herein, the Certificate Insurer shall not acquire
any voting rights hereunder as a result of such subrogation.
Any amounts received by the Trustee under the Certificate Insurance
Policy pursuant to clause (ii) of the definition of "Insured Payment" shall be
allocated among the Certificate Groups pro rata on the basis of the amounts, if
any, by which the Certificate Principal Balance of each Certificate Group
exceeds the aggregate Principal Balance of the Mortgage Loans in the related
Mortgage Loan Group, and any amounts allocated to the Fixed Rate Group 1
Certificates will be distributed in the priority specified in SECTION
6.05(D)(IV).
(d) (i) Not later than 12:00 p.m. New York time on each Distribution
Date, the Trustee will be required to withdraw from the Collection Account and
distribute, based on the information provided by the Servicer pursuant to
Section 6.07, the Fixed Rate Group 1 Available Funds in the priority described
below:
first, (a) to the Insurance Account for the benefit of the
Certificate Insurer, the Monthly Premium payable to the Certificate Insurer in
respect of the Fixed Rate Group 1 Certificates and (b) to the Representative,
the Initial Premium Fee Recovery Amount in respect of the Fixed Rate Group 1
Certificates;
second, to each Class of Fixed Rate Group 1 Certificates, the
related Interest Remittance Amount;
third, to the Fixed Rate Group 1 Certificates, the Fixed Rate Group
1 Basic Principal Distribution Amount in the priority described under Section
6.05(d)(iv);
fourth, to the Certificate Insurer, an amount equal to any Insured
Payments previously made by the Certificate Insurer on the Fixed Rate Group 1
Certificates (including any interest thereon) and not previously reimbursed;
fifth, concurrently, pro rata, as follows:
(i) to the Certificate Insurer, an amount equal to the excess,
if any, of (x) any Insured Payments previously made by the
Certificate Insurer on the Fixed Rate Group 2 Certificates
(including interest thereon) and not previously reimbursed over (y)
the amount actually distributed to the Fixed Rate Group 2
Certificates on such Distribution Date pursuant to Section
6.05(d)(ii), priority fourth below from the Fixed Rate Group 2
Available Funds; and
(ii) to the Certificate Insurer, an amount equal to the
excess, if any, of (x) any Insured Payments previously made by the
Certificate Insurer on the Class A-1A Certificates (including
interest thereon) and not previously reimbursed over (y) the amount
actually distributed to the Class A-1A Certificates on such
Distribution Date pursuant to Section 6.05(d)(iii), priority fourth
below from the Adjustable Rate Group Available Funds;
sixth, concurrently, pro rata, as follows:
(i) to the Fixed Rate Group 2 Certificates, an amount equal to
the excess, if any, of (x) the related Interest Remittance Amount
for such Distribution Date over (y) the amount actually distributed
to the Fixed Rate Group 2 Certificates on such Distribution Date
pursuant to SECTION 6.05(D)(II), priority second below from the
Fixed Rate Group 2 Available Funds; and
(ii) to the Class A-1A Certificates, an amount equal to the
excess, if any, of (x) the related Interest Remittance Amount for
such Distribution Date over (y) the amount actually distributed to
the Class A-1A Certificates on such Distribution Date pursuant to
SECTION 6.05(D)(III), priority second below from the Adjustable Rate
Group Available Funds;
seventh, concurrently, pro rata, as follows:
(i) to the Fixed Rate Group 2 Certificates, an amount equal to
the excess, if any of (x) the Fixed Rate Group 2 Basic Principal
Distribution Amount for such Distribution Date over (y) the amount
actually distributed to the Fixed Rate Group 2 Certificates on such
Distribution Date pursuant to Section 6.05(d)(ii), priority third
below from the Fixed Rate Group 2 Available Funds; and
(ii) to the Class A-1A Certificates, an amount equal to the
excess, if any, of (x) the Class A-1A Basic Principal Distribution
Amount for such Distribution Date over (y) the amount actually
distributed to the Class A-1A Certificates on such Distribution Date
pursuant to Section 6.05(d)(iii), priority third below from the
Adjustable Rate Group Available Funds;
eighth, to the Fixed Rate Group 1 Certificates, in the priority
described in Section 6.05(d)(iv) below, an amount equal to the Fixed Rate Group
1 Extra Principal Distribution Amount;
ninth, concurrently, pro rata, as follows:
(i) to the Fixed Rate Group 2 Certificates, an amount equal to
any remaining Overcollateralization Deficiency Amount for such
Distribution Date for the Fixed Rate Group 2 Certificates after
distribution to the Fixed Rate Group 2 Certificates on such
Distribution Date pursuant to Section 6.05(d)(ii), priority eighth
below from the Fixed Rate Group 2 Available Funds; and
(ii) to the Class A-1A Certificates, an amount equal to any
remaining Overcollateralization Deficiency Amount for such
Distribution Date for the Class A-1A Certificates after
distributions to the Class A-1A Certificates on such Distribution
Date pursuant to Section 6.05(d)(iii), priority eighth below from
the Adjustable Rate Group Available Funds;
tenth, to the Trustee, any amounts then due and owing representing
fees of the Trustee in respect of Fixed Rate Group 1, provided that the Trustee
certifies in writing that such amount is due and owing and has not been paid by
the Servicer within 30 days after written demand therefor;
eleventh, to the Servicer and/or the Representative, as applicable,
any Reimbursable Amounts in respect of Fixed Rate Group 1;
twelfth, to the Servicer, an amount equal to Nonrecoverable Advances
previously made by the Servicer in respect of Fixed Rate Group 1 and not
previously reimbursed;
thirteenth, in respect of Fixed Rate Group 1, to the applicable
Fixed Rate Group 1 Certificates, pro rata, the related unpaid Fixed Rate Group 1
Interest Carryovers, if any;
fourteenth, concurrently, pro rata, as follows:
(i) to the Fixed Rate Group 2 Certificates, unpaid Fixed Rate
Group 2 Interest Carryovers, if any, after giving effect to the
amount actually distributed on such Distribution Date pursuant to
Section 6.05(d)(ii), priority thirteenth below; and
(ii) to the Class A-1A Certificates, unpaid Class A-1A LIBOR
Interest Carryovers, if any, after giving effect to the amount
actually distributed on such Distribution Date pursuant to Section
6.05(d)(iii), priority thirteenth below;
fifteenth, to the Class X Certificates, the Unpaid Class X
Remittance Amount (without duplication of amounts distributed pursuant to
priority fifteenth of SECTIONS 6.05(D)(II) or 6.05(D)(III)); and
sixteenth, to the Class R-IV Certificates, the balance, if any, of
the Fixed Rate Group 1 Available Funds.
(ii) On each Distribution Date the Trustee shall withdraw from
the Collection Account and distribute, based on the information provided
by the Servicer pursuant to Section 6.07, the Fixed Rate Group 2 Available
Funds in the priority described below:
first, (a) to the Insurance Account, for the benefit of the
Certificate Insurer, the Monthly Premium payable to the Certificate Insurer in
respect of the Fixed Rate Group 2 Certificates and (b) to the representative,
the Initial Premium Fee Recovery Amount with respect to the Fixed Rate Group 2
Certificates;
second, to the Fixed Rate Group 2 Certificates, the related
Interest Remittance Amount;
third, to the Fixed Rate Group 2 Certificates, the Fixed Rate
Group 2 Basic Principal Distribution Amount, until the Certificate Balance of
such Class has been reduced to zero;
fourth, to the Certificate Insurer, an amount equal to any Insured
Payments previously made by the Certificate Insurer on the Fixed Rate Group 2
Certificates (including any interest thereon) and not previously reimbursed;
fifth, concurrently, pro rata, as follows:
(i) to the Certificate Insurer, an amount equal to the excess,
if any, of (x) any Insured Payments previously made by the
Certificate Insurer on the Fixed Rate Group 1 Certificates
(including interest thereon) and not previously reimbursed over (y)
the amount actually distributed to the Fixed Rate Group 1
Certificates on such Distribution Date pursuant to Section
6.05(d)(i), priority fourth above from the Fixed Rate Group 1
Available Funds; and
(ii) to the Certificate Insurer, an amount equal to the
excess, if any, of (x) any Insured Payments previously made by the
Certificate Insurer on the Class A-1A Certificates (including
interest thereon) and not previously reimbursed over (y) the amount
actually distributed to the Class A-1A Certificates on such
Distribution Date pursuant to Section 6.05(d)(iii), priority fourth
below from the Adjustable Rate Group Available Funds;
sixth, concurrently, pro rata, as follows:
(i) concurrently, to each Class of Fixed Rate Group 1
Certificates, pro rata, an amount equal to the excess, if any, of
(x) the related Interest Remittance Amount for such Distribution
Date over (y) the amount actually distributed to such Fixed Rate
Group 1 Certificates on such Distribution Date pursuant to Section
6.05(d)(i), priority second above from the Fixed Rate Group 1
Available Funds; and
(ii) to the Class A-1A Certificates, an amount equal to the
excess, if any, of (x) the related Interest Remittance Amount for
such Distribution Date over (y) the amount actually distributed to
the Class A-1A Certificates on such Distribution Date pursuant to
Section 6.05(d)(iii), priority second below from the Adjustable Rate
Group Available Funds;
seventh, concurrently, pro rata, as follows:
(i) to the Fixed Rate Group 1 Certificates, in the priority
described under Section 6.05(d)(iv) below, an amount equal to the
excess, if any, of (x) the Fixed Rate Group 1 Basic Principal
Distribution Amount for such Distribution Date over (y) the amount
actually distributed to the Fixed Rate Group 1 Certificates on such
Distribution Date pursuant to Section 6.05(d)(i), priority third
above from the Fixed Rate Group 1 Available Funds; and
(ii) to the Class A-1A Certificates, an amount equal to the
excess, if any of (x) the Class A-1A Basic Principal Distribution
Amount for such Distribution Date over (y) the amount actually
distributed to the Class A-1A Certificates on such Distribution Date
pursuant to Section 6.05(d)(iii), priority third below from the
Adjustable Rate Group Available Funds;
eighth, to the Fixed Rate Group 2 Certificates, an amount equal to
the Fixed Rate Group 2 Extra Principal Distribution Amount;
ninth, concurrently, pro rata, as follows:
(i) to the Fixed Rate Group 1 Certificates, in the priority
described under Section 6.05(d)(iv) below, an amount equal to any
remaining Overcollateralization Deficiency Amount for such
Distribution Date for the Fixed Rate Group I Certificates after
distributions to the Fixed Rate Group 1 Certificates on such
Distribution Date pursuant to Section 6.05(d)(i), priority eighth
above from the Fixed Rate Group 1 Available Funds; and
(ii) to the Class A-1A Certificates, an amount equal to any
remaining Overcollateralization Deficiency Amount for such
Distribution Date for the Class A-1A Certificates after
distributions to the holders of the Class A-1A Certificates on such
Distribution Date pursuant to Section 6.05(d)(iii), priority eighth
below from the Adjustable Rate Group Available Funds;
tenth, to the Trustee, any amounts then due and owing representing
fees of the Trustee in respect of Fixed Rate Group 2, provided that the Trustee
certifies in writing that such amount is due and owing and has not been paid by
the Servicer within 30 days after written demand therefor;
eleventh, to the Servicer and/or the Representative, as applicable,
any Reimbursable Amounts in respect of Fixed Rate Group 2;
twelfth, to the Servicer, an amount equal to Nonrecoverable Advances
previously made by the Servicer in respect of Fixed Rate Group 2 and not
previously reimbursed;
thirteenth, to the Fixed Rate Group 2 Certificates, unpaid Fixed
Rate Group 2 Interest Carryovers, if any;
fourteenth, concurrently, pro rata, as follows:
(i) concurrently, to each Class of Fixed Rate Group 1
Certificates, pro rata, unpaid Fixed Rate Group 1 Interest
Carryovers, if any, after giving effect to the amount actually
distributed on such Distribution Date pursuant to Section
6.05(d)(i), priority thirteenth above; and
(ii) to the Class A-1A Certificates, unpaid Class A-1A LIBOR
Interest Carryovers, if any, after giving effect to the amount
actually distributed on such Distribution Date pursuant to Section
6.05(d)(iii), priority thirteenth below;
fifteenth, to the Class X Certificates, the Unpaid Class X
Remittance Amount (without duplication of amounts distributed pursuant to
priority fifteenth of SECTIONS 6.05(D)(I) or 6.05(D)(III)); and
sixteenth, to the Class R-IV Certificates, the balance, if any, of
the Fixed Rate Group 2 Available Funds.
(iii) On each Distribution Date, the Trustee shall withdraw from
the Collection Account and distribute, based on the information provided
by the Servicer pursuant to Section 6.07, the Adjustable Rate Group
Available Funds in the priority described below:
first, (a) to the Insurance Account, for the benefit of the
Certificate Insurer, the Monthly Premium payable to the Certificate Insurer in
respect of the Class A-1A Certificates and (b) to the Representative, the
Initial Premium Fee Recovery Amount in respect of the Class A-1A Certificates;
second, to the Class A-1A Certificates, the related Interest
Remittance Amount;
third, to the Class A-1A Certificates, the Class A-1A Basic
Principal Distribution Amount, until the Certificate Balance thereof has been
reduced to zero;
fourth, to the Certificate Insurer, an amount equal to any Insured
Payments previously made by the Certificate Insurer on the Class A-1A
Certificates (including any interest thereon) and not previously reimbursed;
fifth, concurrently, pro rata, as follows:
(i) to the Certificate Insurer, an amount equal to the excess,
if any, of (x) any Insured Payments previously made by the
Certificate Insurer on the Fixed Rate Group 1 Certificates
(including interest thereon) and not previously reimbursed over (y)
the amount actually distributed to the Fixed Rate Group 1
Certificates on such Distribution Date pursuant to Section
6.05(d)(i), priority fourth above from the Fixed Rate Group 1
Available Funds; and
(ii) to the Certificate Insurer, an amount equal to the
excess, if any, of (x) any Insured Payments previously made by the
Certificate Insurer on the Fixed Rate Group 2 Certificates
(including interest thereon) and not previously reimbursed over (y)
the amount actually distributed to the Fixed Rate Group 2
Certificates on such Distribution Date pursuant to Section
6.05(d)(ii), priority fourth above from the Fixed Rate Group 2
Available Funds;
sixth, concurrently, pro rata, as follows:
(i) concurrently, to each Class of Fixed Rate Group 1
Certificates, pro rata, an amount equal to the excess, if any, of
(x) the related Interest Remittance Amount for such Distribution
Date over (y) the amount actually distributed to such Fixed Rate
Group 1 Certificates from the Fixed Rate Group 1 Available Funds on
such Distribution Date pursuant to Section 6.05(d)(i), priority
second above from the Fixed Rate Group 1 Available Funds; and
(ii) to the Fixed Rate Group 2 Certificates, an amount equal
to the excess, if any, of (x) the Interest Remittance Amount for
such Distribution Date over (y) the amount actually distributed to
the Fixed Rate Group 2 Certificates on such Distribution Date
pursuant to Section 6.05(d)(ii), priority second above from the
Fixed Rate Group 2 Available Funds;
seventh, concurrently, pro rata, as follows:
(i) to the Fixed Rate Group 1 Certificates, in the priority
described under Section 6.05(d)(iv) below, an amount equal to the
excess, if any, of (x) the Group 1 Basic Principal Distribution
Amount for such Distribution Date over (y) the amount actually
distributed to the Fixed Rate Group 1 Certificates on such
Distribution Date pursuant to Section 6.05(d)(i), priority third
above from the Fixed Rate Group 1 Available Funds; and
(ii) to the Fixed Rate Group 2 Certificates, an amount equal
to the excess, if any of (x) the Fixed Rate Group 2 Basic Principal
Distribution Amount for such Distribution Date over (y) the amount
actually distributed to the Fixed Rate Group 2 Certificates on such
Distribution Date pursuant to Section 6.05(d)(ii), priority third
above from the Fixed Rate Group 2 Available Funds;
eighth, to the Class A-1A Certificates, an amount equal to the Class
A-1A Extra Principal Distribution Amount;
ninth, concurrently, pro rata, as follows:
(i) to the Fixed Rate Group 1 Certificates, in the priority
described under Section 6.05(d)(iv) below, an amount equal to any
remaining Overcollateralization Deficiency Amount for such
Distribution Date for the Fixed Rate Group 1 Certificates after
distributions to the Fixed Rate Group 1 Certificates on such
Distribution Date pursuant to Section 6.05(d)(i), priority eighth
above from the Fixed Rate Group 1 Available Funds;
(ii) to the Fixed Rate Group 2 Certificates, an amount equal
to any remaining Overcollateralization Deficiency Amount for such
Distribution Date for the Fixed Rate Group 2 Certificates after
distributions to the Fixed Rate Group 2 Certificates on such
Distribution Date pursuant to Section 6.05(d)(ii), priority eighth
above from the Fixed Rate Group 2 Available Funds;
tenth, to the Trustee, any amounts then due and owing representing
fees of the Trustee in respect of the Adjustable Rate Group, provided that the
Trustee certifies in writing that such amount is due and owing and has not been
paid by the Servicer within 30 days after written demand therefor;
eleventh, to the Servicer and/or the Representative, as applicable,
any Reimbursable Amounts in respect of the Adjustable Rate Group;
twelfth, to the Servicer, an amount equal to Nonrecoverable Advances
previously made by the Servicer in respect of the Adjustable Rate Group and not
previously reimbursed;
thirteenth, to the Class A-1A Certificates, unpaid Class A-1A
Interest Carryovers, if any;
fourteenth, concurrently, pro rata, as follows:
(i) concurrently, to each Class of Fixed Rate Group 1
Certificates, pro rata, unpaid Fixed Rate Group 1 Interest
Carryovers, if any, after giving effect to the amount actually
distributed on such Distribution Date pursuant to Section
6.05(d)(i), priority thirteenth above; and
(ii) to the Fixed Rate Group 2 Certificates, unpaid Fixed Rate
Group 2 Interest Carryovers, if any, after giving effect to the
amount actually distributed on such Distribution Date pursuant to
Section 6.05(d)(ii), priority thirteenth above;
fifteenth, to the Class X Certificates, the Unpaid Class X
Remittance Amount (without duplication of amounts distributed pursuant to
priority fifteenth of SECTIONS 6.05(D)(I) or 6.05(D)(II)); and
sixteenth, to the Class R-IV Certificates, the balance, if any, of
the Adjustable Rate Group Available Funds.
(iv) Any amounts received from Available Funds in respect of the
Fixed Rate Group 1 Principal Distribution Amount will be distributed
sequentially in accordance with the following priorities:
first, to the Class A-6F Certificates, up to the Lockout Remittance
Amount for such Distribution Date;
second, sequentially, to the Class A-1F, Class A-2F, Class A-3F,
Class A-4F and Class A-5F Certificates, until the Certificate Balance of each
such Class has been reduced to zero; and
third, to the Class A-6F Certificates, without regard to the Lockout
Remittance Amount for such Distribution Date, until the Certificate Balance
thereof has been reduced to zero.
(v) (A) Amounts distributed pursuant to Section 6.05(d)(i),
priorities sixth, seventh, eighth and ninth, Section 6.05(d)(ii),
priorities sixth, seventh, eighth and ninth and Section 6.05(d)(iii),
priorities sixth, seventh, eighth and ninth shall be allocated pro rata
(based on interest accrued) in reduction of the Fixed Rate Group 1
Component Remittance Amounts, the Fixed Rate Group 2 Component Remittance
Amounts and the Adjustable Rate Group Component Remittance Amounts,
respectively.
(B)Amounts distributed pursuant to Section 6.05(d)(i), priority
thirteenth and fourteenth, Section 6.05(d)(ii), priority thirteenth and
fourteenth and Section 6.05(d)(iii), priority thirteenth and fourteenth
shall be deemed to have been first distributed in respect of the Class X
Interest and paid outside the Trust REMICs, allocable pro rata (based on
interest accrued) in respect of the Fixed Rate Group 1 Component
Remittance Amounts, the Fixed Rate Group 2 Component Remittance Amounts
and the Adjustable Rate Group Component Remittance Amounts, respectively.
(C)Amounts distributed pursuant to Section 6.05(d)(i), priority
fifteenth, Section 6.05(d)(ii), priority fifteenth and Section
6.05(d)(iii), priority fifteenth shall be distributed in respect of the
Class X Interest pro rata (based on interest accrued) in respect of the
Fixed Rate Group 1 Component Remittance Amounts, the Fixed Rate Group 2
Component Remittance Amounts and the Adjustable Rate Group Component
Remittance Amounts, respectively.
(vi) Any Available Funds which are available to be distributed
pursuant to priorities fifth, sixth, seventh, ninth or fourteenth,
respectively, of SECTIONS 6.05(D)(I), 6.05(D) (II) or 6.05(D)(III) shall
be distributed on a pro rata basis.
(e) (i) All distributions made pursuant to SECTION 6.05(D) above in
respect of the REMIC IV Regular Interests shall be treated as having been
distributed in respect of the REMIC I Regular Interests pursuant to SECTION
6.05(E)(IV) and deposited in the REMIC II Distribution Account, then as having
been distributed in respect of the REMIC II Regular Interests pursuant to
SECTION 6.05(E)(III) and deposited into the REMIC III Distribution Account, then
as having been distributed in respect of the REMIC III Regular Interests
pursuant to SECTION 6.05(E)(II) and deposited in the REMIC IV Distribution
Account, and finally as having been distributed to Certificateholders from the
REMIC IV Distribution Account.
(ii) REMIC III. For each Distribution Date, amounts shall
be distributed on the REMIC III Regular Interests as follows:
(A)(I) Interest shall accrue on the Class NTA1, Class NTA2,
Class NTA3, Class NTA4, Class NTA5 and Class NTA6 Interests at a rate
equal to the Net Fixed Rate Group 1 Weighted Average Mortgage Interest
Rate, and shall be distributed thereon to the extent of the sum of (a)
amounts distributed pursuant to Section 6.05(d)(i), priority second on the
respective Classes of Fixed Rate Group 1 Certificates, (b) amounts
distributed pursuant to Section 6.05(d)(ii), priority sixth (i) and
Section 6.05(d)(iii), priority sixth (i) on the respective Classes of
Fixed Rate Group 1 Certificates, and (c) amounts distributable or deemed
distributed pursuant to Section 6.05(d)(i), priority fifteenth and Section
6.05(d)(v) and allocable in respect of the Class X-1F, Class X-2F, Class
X-3F, Class X-4F, Class X-5F and Class X-6F Components.
(II) Interest shall be distributed in respect of the Class
NTN1 Interest to the extent of amounts distributed or deemed distributed
pursuant to Section 6.05(d)(i), priority fifteenth and Section 6.05(d)(v)
and allocable in respect of clause (i) of the Class X-E Component.
(III) Principal shall be distributed on the Class NTA1, Class
NTA2, Class NTA3, Class NTA4, Class NTA5 and Class NTA6 Interests to the
extent distributed on the related Fixed Rate Group 1 Certificates pursuant
to Section 6.05(d)(i), priority third, Section 6.05(d)(i), priority
eighth, Section 6.05(d)(ii), priority seventh (i), Section 6.05(d)(iii),
priority seventh (i), Section 6.05(d)(ii), priority ninth (i) and Section
6.05(d)(iii), priority ninth (i).
(B)(I) Interest shall accrue on the Class NTA7 Interest at a
rate equal to the Net Fixed Rate Group 2 Weighted Average Mortgage
Interest Rate, and shall be distributed thereon to the extent of the sum
of (a) amounts distributed pursuant to Section 6.05(d)(ii), priority
second on the Class A-7F Certificates, (b) amounts distributed pursuant to
Section 6.05(d)(i), priority sixth (i) and Section 6.05(d)(iii), priority
sixth (i) on the Class A-7F Certificates, and (c) amounts distributable or
deemed distributed pursuant to Section 6.05(d)(ii), priority fifteenth and
the Section 6.05(d)(v) and allocable in respect of the Class X-7F
Component.
(II) Interest shall be distributed in respect of the Class
NTN2 Interest to the extent of amounts distributed or deemed distributed
pursuant to Section 6.05(d)(ii), priority fifteenth and Section 6.05(d)(v)
and allocable in respect of clause (ii) of the Class X-E Component.
(III) Principal shall be distributed on the Class NTA7
Interest to the extent distributed on the Class A-7F Certificates pursuant
to Section 6.05(d)(ii), priority third, Section 6.05(d)(ii), priority
eighth, Section 6.05(d)(i), priority seventh (i), Section 6.05(d)(iii),
priority seventh (i), Section 6.05(d)(i), priority ninth (i) and Section
6.05(d)(iii), priority ninth (i).
(C)(I) Interest shall accrue on the Class NTA-1A Interest at a
rate equal to the Net Adjustable Rate Group Weighted Average Mortgage
Interest Rate, and shall be distributed thereon to the extent of the sum
of (a) amounts distributed pursuant to Section 6.05(d)(iii), priority
second on the Class A-1A Certificates, (b) amounts distributed pursuant to
Section 6.05(d)(i), priority sixth (ii) and Section 6.05(d)(ii), priority
sixth (ii) on the Class A-1A Certificates, and (c) amounts distributed or
deemed distributed pursuant to Section 6.05(d)(iii), priority fifteenth
and the last paragraph of Section 6.05(d)(v) and allocable in respect of
the Class X-A Component.
(II) Interest shall be distributed in respect of the Class NTN
2 Interest to the extent of amounts distributed or deemed distributed
pursuant to Section 6.05(d)(iii), priority fifteenth and Section
6.05(d)(v) and allocable in respect of clause (iii) of the Class X-E
Component.
(III) Principal shall be distributed on the Class NTA-1A
Interest to the extent distributed on the Class A-1A Certificates pursuant
to Section 6.05(d)(iii), priority third, Section 6.05(d)(iii), priority
eighth, Section 6.05(d)(i), priority seventh (ii), Section 6.05(d)(ii),
priority seventh (ii), Section 6.05(d)(i), priority ninth (ii) and Section
6.05(d)(ii), priority ninth (ii).
(IV) All Insured Payments shall be treated as having been
deposited in the REMIC III Distribution Account and are part of the
distributable amount in REMIC III. All amounts distributable to the
Certificate Insurer pursuant to Section 6.05(d)(i), priorities fourth and
fifth, Section 6.05(d)(ii), priorities fourth and fifth, and Section
6.05(d)(iii), priorities fourth and fifth shall be treated as having been
distributed to the Certificate Insurer from REMIC III.
(iii) REMIC II. For each Distribution Date, amounts shall
be distributed on the REMIC II Regular Interests as follows:
(A) On each Distribution Date, the Fixed Rate Group 1
Available Funds (excluding any Insured Payments) shall be distributed in
respect of the Class MT1, Class MTN1, Class MT2, Class MTN2, Class MT3 and
Class MTN3 Interests as follows:
(I) The Fixed Rate Group 1 Basic Principal Distribution Amount
shall be distributed pro rata (based on principal balances) among the
Class MT1, Class MT2 and Class MT3 Interests, such that their principal
balances remain in the ratio of 98% of the Pool Principal Balance of Fixed
Rate Group 1, 1% of the excess of the Pool Principal Balance of Fixed Rate
Group 1 over the Group 1 OC Amount and 1% of the sum of the Pool Principal
Balance of Fixed Rate Group 1 and the Group 1 OC Amount, respectively.
(II) Such portion of the Fixed Rate Group 1 Available Funds
representing interest collections on Fixed Rate Group 1 shall be
distributed to the Class MT 1, Class MTN1, Class MT2, Class MTN2, Class
MT3 and Class MTN3 Interests, up to the amount distributable at the
interest rates set forth in the definitions thereof on their principal
balances or notional balances, as applicable, pro rata (based on interest
accrued).
(III) Any recoveries of principal losses or prior shortfalls
in interest on Fixed Rate Group 1 received by REMIC II shall be
distributed to the Class MT1, Class MTN1, Class MT2, Class MTN2, Class MT3
and Class MTN3 Interests, as the case may be, in the proportions in which
such losses or shortfalls were previously incurred.
(B) On each Distribution Date, the Fixed Rate Group 2
Available Funds (excluding any Insured Payments) shall be distributed in
respect of the Class MT4, Class MTN4, Class MT5, Class MTN5, Class MT6 and
Class MTN6 Interests as follows:
(I) The Fixed Rate Group 2 Basic Principal Distribution Amount
shall be distributed pro rata (based on principal balances) among the
Class MT4, Class MT5 and Class MT6 Interests, such that their principal
balances remain in the ratio of 98% of Pool Principal Balance of Fixed
Rate Group 1, 1% of the excess of the Pool Principal Balance of Fixed Rate
Group 2 over the Group 2 OC Amount and 1% of the sum of the Pool Principal
Balance of Fixed Rate Group 2 and the Group 2 OC Amount, respectively.
(II) Such portion of the Fixed Rate Group 2 Available Funds
representing interest collections on Fixed Rate Group 2 shall be
distributed to the Class MT4, Class MTN4, Class MT5, Class MTN5, Class MT6
and Class MTN6 Interests, up to the amount distributable at the interest
rates set forth in the definitions thereof on their principal balances or
notional balances, as applicable, pro rata (based on interest accrued).
(III) Any recoveries of principal losses or prior shortfalls
in interest on Fixed Rate Group 2 received by REMIC II shall be
distributed to the Class MT4, Class MTN4, Class MT5, Class MTN5, Class MT6
and Class MTN 6 Interests, as the case may be, in the proportions in which
such losses or shortfalls were previously incurred.
(C) On each Distribution Date, the Adjustable Rate Group
Available Funds (excluding any Insured Payments) shall be distributed in
respect of the Class MT7, Class MTN7, Class MT8, Class MTN8, Class MT9 and
Class MTN9 Interests as follows:
(I) The Class A-1A Basic Principal Distribution Amount shall
be distributed pro rata (based on principal balances) among the Class MT7,
Class MT8 and Class MT9 Interests, such that their principal balances
remain in the ratio of 98% of Pool Principal Balance of the Adjustable
Rate Group, 1% of the excess of the Pool Principal Balance of the
Adjustable Rate Group over the Group 3 OC Amount and 1% of the sum of the
Pool Principal Balance of the Adjustable Rate Group and the Group 3 OC
Amount, respectively.
(II) Such portion of the Adjustable Rate Group Available Funds
representing interest collections on Adjustable Rate Group shall be
distributed to the Class MT7, Class MTN7, Class MT8, Class MTN8, Class MT9
and Class MTN9 Interests, up to the amount distributable at the interest
rates set forth in the definitions thereof on their principal balances or
notional balances, as applicable, pro rata (based on interest accrued).
(III) Any recoveries of principal losses or prior shortfalls
in interest on the Adjustable Rate Group received by REMIC II shall be
distributed to the Class MT7, Class MTN7, Class MT8, Class MTN8, Class MT9
and Class MTN9 Interests, as the case may be, in the proportions in which
such losses or shortfalls were previously incurred.
(iv) REMIC I. For each Distribution Date, amounts shall be
distributed on the REMIC I Regular Interests as follows:
(A) On each Distribution Date, the Fixed Rate Group 1
Available Funds (excluding any Insured Payments) shall be distributed in
respect of the Class LT1, Class LT2 and Class LT3 Interests as follows:
(I) the Fixed Rate Group 1 Basic Principal Distribution Amount shall be
distributed pro rata (based on principal balances) among the Class LT1,
Class LT2 and Class LT3 Interests, such that their principal balances
remain in the ratio of 98% of Pool Principal Balance of Fixed Rate Group
1, 1% of the excess of the Pool Principal Balance of Fixed Rate Group 1
over the Group 1 OC Amount and 1% of the sum of the Pool Principal Balance
of Fixed Rate Group 1 and the Group 1 OC Amount, respectively.
(II) Such portion of the Fixed Rate Group 1 Available Funds
representing interest collections on Fixed Rate Group 1 shall be
distributed to the Class LT1, Class LT2, and Class LT3 Interests, up to
the amount distributable at the interest rates set forth in the
definitions thereof on their principal balances, pro rata (based on
interest accrued).
(III) Subject to Section 6.05(e)(iv)(D), any recoveries of
principal losses or prior shortfalls in interest on Fixed Rate Group 1
received by REMIC I shall be distributed to the Class LT1, Class LT2, and
Class LT3 Interests, as the case may be, in the proportions in which such
losses or shortfalls were previously incurred.
(B) On each Distribution Date, the Fixed Rate Group 2
Available Funds (excluding any Insured Payments) shall be distributed in
respect of the Class LT4, Class LT5 and Class LT6 Interests as follows:
(I) the Fixed Rate Group 2 Basic Principal Distribution Amount shall be
distributed pro rata (based on principal balances) among the Class LT4,
Class LT5 and Class LT6 Interests, such that their principal balances
remain in the ratio of 98% of Pool Principal Balance of Fixed Rate Group
2, 1% of the excess of the Pool Principal Balance of Fixed Rate Group 2
over the Group 2 OC Amount and 1% of the sum of the Pool Principal Balance
of Fixed Rate Group 2 and the Group 2 OC Amount, respectively.
(II) Such portion of the Fixed Rate Group 2 Available Funds
representing interest collections on Fixed Rate Group 2 shall be
distributed to the Class LT4, Class LT5 and Class LT6 Interests, up to the
amount distributable at the interest rates set forth in the definitions
thereof on their principal balances, pro rata (based on interest accrued).
(III) Subject to Section 6.50(e)(iv)(D), any recoveries of
principal losses or prior shortfalls in interest on Fixed Rate Group 2
received by REMIC I shall be distributed to the Class LT4, Class LT5, and
Class LT6 Interests, as the case may be, in the proportions in which such
losses or shortfalls were previously incurred.
(C) On each Distribution Date, the Adjustable Rate Group
Available Funds (excluding any Insured Payments) shall be distributed in
respect of the Class LT7, Class LT8 and Class LT9 Interests as follows:
(I) The Class A-1A Basic Principal Distribution Amount shall
be distributed pro rata (based on principal balances) among the Class LT7,
Class LT8 and Class LT9 Interests, such that their principal balances
remain in the ratio of 98% of Pool Principal Balance of the Adjustable
Rate Group, 1% of the excess of the Pool Principal Balance of the
Adjustable Rate Group over the Group 3 OC Amount and 1% of the sum of the
Pool Principal Balance of the Adjustable Rate Group and the Group 3 OC
Amount, respectively.
(II) Such portion of the Adjustable Rate Group Available Funds
representing interest collections on the Adjustable Rate Group shall be
distributed to the Class LT7, Class LT8 and Class LT9 Interests, up to the
amount distributable at the interest rates set forth in the definitions
thereof on their principal balances or notional balances, as applicable,
pro rata (based on interest accrued).
(III) Subject to Section 6.05(e)(iv)(D) any recoveries of
principal losses or prior shortfalls in interest on the Adjustable Rate
Group received by REMIC I shall be distributed to the Class LT7, Class LT8
and Class LT9 Interests, as the case may be, in the proportions in which
such losses or shortfalls were previously incurred.
(D) All amounts distributable pursuant to Section 6.05(d)(i),
priorities first, tenth, eleventh and twelfth, Section 6.50(d)(ii),
priorities first, tenth, eleventh and twelfth, and Section 6.50(d)(iii),
priorities first, tenth, eleventh and twelfth, shall be treated as having
been distributed to the Insurance Account, the Trustee, or the Servicer
and/or the Representative, as applicable, from REMIC I.
(f) All distributions made to the Class A Certificateholders or the
Class X, Class R-I, Class R-II, Class R-III and Class R-IV Certificateholders as
a Class on each Distribution Date will be made on a pro rata basis among the
Certificateholders of the respective Class of record on the next preceding
Record Date based on the Percentage Interest represented by their respective
Certificates, and shall be made by wire transfer of immediately available funds
to the account of such Certificateholder at a bank or other entity having
appropriate facilities therefor, if such Certificateholder shall own of record
Class A Certificates which have denominations aggregating at least $1,000,000
appearing in the Certificate Register, and in all cases with respect to the
Class X, Class R-I, Class R-II, Class R-III and Class R-IV Certificateholders,
and shall have provided complete wiring instructions at least five Business Days
prior to the Record Date, and otherwise by check mailed to the address of such
Certificateholder appearing in the Certificate Register.
Section 6.06 [RESERVED].
Section 6.07 STATEMENTS.
Not later than 12:00 noon Chicago, Illinois time on the Business Day
preceding each Determination Date, the Servicer shall deliver to the Trustee and
the Certificate Insurer a computer tape or written report containing the
information set forth on EXHIBIT R as to each Mortgage Loan with respect to the
related Due Period and such other information with respect to the Mortgage Loans
in the aggregate as the Trustee shall reasonably require. Not later than 12:00
noon Chicago, Illinois time two Business Days preceding each Distribution Date,
the Trustee shall deliver to the Depositors, any Paying Agent, the Servicer, the
Certificate Insurer, Moody's and S&P by telecopy, by request, a statement (the
"REMITTANCE Report") prepared based on the information provided by the Servicer
on EXHIBIT R containing the information set forth below with respect to the
succeeding Distribution Date, with a hard copy thereof to be delivered on the
immediately succeeding Business Day:
(i)the Available Funds attributable to each Mortgage Loan Group
and any portion of the Available Funds that has been deposited in the
Collection Account but may not be withdrawn therefrom pursuant to an order
of a United States bankruptcy court of competent jurisdiction imposing a
stay pursuant to Section 362 of the United States Bankruptcy Code;
(ii) the Class A-1F Principal Balance, the Class A-2F Principal
Balance, the Class A-3F Principal Balance, the Class A-4F Principal
Balance, the Class A-5F Principal Balance, the Class A-6F Principal
Balance, the Class A-7F Principal Balance, the Class A-1A Principal
Balance and the Pool Principal Balance with respect to each Mortgage Loan
Group, as reported pursuant to SUBCLAUSE (XIII) below in the Remittance
Report provided for the immediately preceding Distribution Date, or, in
the case of the first Determination Date, the Original Class A-1F
Principal Balance, the Original Class A-2F Principal Balance, the Original
Class A-3F Principal Balance, the Original Class A-4F Principal Balance,
the Original Class A-5F Principal Balance, the Original Class A-6F
Principal Balance, the Original Class A-7F Principal Balance, the Original
Class A-1A Principal Balance and the Original Pool Principal Balance with
respect to each Mortgage Loan Group;
(iii) with respect to the Mortgage Pool and each Mortgage Loan
Group, the number and the aggregate Principal Balances of all Mortgage
Loans which were the subject of Principal Prepayments during the related
Due Period;
(iv) with respect to the Mortgage Pool and each Mortgage Loan
Group, the amount of all Curtailments which were received during the
related Due Period;
(v)with respect to the Mortgage Pool and each Mortgage Loan
Group, the aggregate amount of principal portions of all Monthly Payments
received during the related Due Period;
(vi) with respect to the Mortgage Pool and each Mortgage Loan
Group, the amount of interest received on the Mortgage Loans during the
related Due Period;
(vii) with respect to the Mortgage Pool and each Mortgage Loan
Group, the aggregate amount of the Advances made and recovered with
respect to such Distribution Date;
(viii) with respect to the Mortgage Pool and each Mortgage Loan
Group, the delinquency and foreclosure information set forth in the form
attached hereto as EXHIBIT H and the amount of Mortgage Loan Losses during
the related Due Period;
(ix) the Class A-1F Principal Balance, the Class A-2F Principal
Balance, the Class A-3F Principal Balance, the Class A-4F Principal
Balance, the Class A-5F Principal Balance, the Class A-6F Principal
Balance, the Class A-7F Principal Balance, and the Class A-1A Principal
Balance after giving effect to the distribution to be made on such
Distribution Date;
(x)with respect to the Mortgage Pool and each Mortgage Loan
Group, the weighted average maturity and the weighted average Mortgage
Interest Rate of the Mortgage Loans in each Mortgage Loan Group as of the
last day of the related Due Period;
(xi) the Servicing Fees paid and Servicing Fees accrued
during the related Due Period;
(xii) the amount of all payments or reimbursements to the
Servicer pursuant to SECTION 5.04 (II), (IV), (V), (VI) AND (VII) paid or
to be paid since the prior Distribution Date (or in the case of the first
Distribution Date, since the Closing Date);
(xiii) the Pool Principal Balance and aggregate Principal Balance
for each Mortgage Loan Group as of the last day of the related Due Period;
(xiv) such other information as the Certificate Insurer and the
Certificateholders may reasonably require;
(xv) the amounts which are reimbursable to the Servicer,
the Representative or the Depositors, as appropriate, pursuant to
SECTION 6.05;
(xvi) with respect to the Mortgage Pool and each Mortgage Loan
Group, the number of Mortgage Loans outstanding at the beginning and at
the end of the related Due Period;
(xvii) the aggregate interest accrued on the Mortgage Loans at
their respective Mortgage Interest Rates for the related Due Period;
(xviii) the Overcollateralized Amount, the Overcollateralization
Target Amount and any Overcollateralization Deficiency Amount for each
Certificate Group for each Distribution Date, in each case after giving
effect to distributions on such Distribution Date;
(xix) the aggregate Mortgage Loan Losses since the Cut-off Date
as of the end of the related Due Period;
(xx) the Class A-1A LIBOR Interest Carryover, Fixed Rate Group 1
Interest Carryover and Fixed Rate Group 2 Interest Carryover with respect
to such Distribution Date and, any such unpaid Class A-1A LIBOR Interest
Carryover, Fixed Rate Group 1 Interest Carryover and Fixed Rate Group 2
Interest Carryover from prior Distribution Date(s), including interest
accrued thereon; and
(xxi) the Pass-Through Rate for each Class of Class A
Certificates for the related Accrual Period; and
(xxii) the aggregate amount of interest and/or principal
(reported separately) to be distributed on each Class of Certificates on
such Distribution Date.
The Trustee shall forward such report to the Certificateholders on
the Distribution Date, by telecopy, with a hard copy to follow (in the case of
the Depository) or by first class mail. The Depositors and the Trustee may fully
rely upon and shall have no liability with respect to information provided by
the Servicer.
To the extent that there are inconsistencies between the telecopy of
the Remittance Report and the hard copy thereof, the Servicer and the Trustee
may rely upon the telecopy.
In the case of information furnished pursuant to SUBCLAUSE (XXII)
above, the amounts shall be expressed in a separate section of the report as a
dollar amount for each of the Class A Certificates for each $1,000 original
principal amount as of the Cut-off Date.
(a) Upon reasonable advance notice in writing, the Servicer will
provide to the Trustee access to information and documentation regarding the
Mortgage Loans sufficient to permit any Holder which is a savings and loan
association, bank or insurance company to comply with applicable regulations of
the FDIC or other regulatory authorities with respect to investment in the
Certificates, as applicable.
(b) Not later than 10 days after each Distribution Date, the
Servicer shall provide the Cumulative Loss Percentage to the Trustee and the
Certificate Insurer as of the most recent Distribution Date. In addition, the
Servicer shall furnish to the Trustee and to the Certificate Insurer, during the
term of this Agreement, such periodic, special, or other reports or information
not specifically provided for herein, as may be necessary, reasonable, or
appropriate with respect to the Trustee or the Certificate Insurer, as the case
may be, or otherwise with respect to the purposes of this Agreement, all such
reports or information to be provided by and in accordance with such applicable
instructions and directions as the Trustee or the Certificate Insurer may
reasonably require; PROVIDED, that the Servicer shall be entitled to be
reimbursed by the requesting party, for the fees and actual expenses associated
with providing such reports, if such reports are not generally produced in the
ordinary course of its business.
(c) Reports and computer tapes furnished by the Servicer pursuant
to this Agreement shall be deemed confidential and of proprietary nature, and
shall not be copied or distributed except in connection with the purposes and
requirements of this Agreement; provided that the Certificate Insurer may copy
or distribute such information (A) pursuant to a subpoena or order issued by a
court of competent jurisdiction or by a judicial or administrative or
legislative body or committee, (B) as may be required in any report, statement
or testimony submitted to any Federal, state, municipal or other regulatory body
having jurisdiction over the Certificate Insurer, (C) in order to comply with
any law, ruling, order or regulation applicable to the Certificate Insurer, or
(D) as may be required by any rating agency or reinsurer. No Person entitled to
receive copies of such reports or tapes shall use the information therein for
the purpose of soliciting the customers of the Originators or for any other
purpose except as set forth in this Agreement.
(d) The Trustee shall promptly send to the Certificate Insurer
and, upon request, to each Certificateholder in writing:
(i) notice of the appointment of any Subservicer;
(ii) notice of any transfer of any Account to a different
depository institution;
(iii) a copy of each Officer's Certificate delivered pursuant
to SECTION 7.04 and any notice received from the Servicer of a
change in the fiscal year of the Servicer;
(iv) a copy of each letter delivered pursuant to SECTION 7.05;
and
(v) notice of the receipt by the Trustee of any information
regarding the Servicer's servicing activities pursuant to the last
paragraph of SECTION 10.01(C).
PROVIDED, that in each case the Trustee shall only be required to send such
notices and other items to such Persons to the extent that the Trustee has
itself received the related information.
The Depositors, the Servicer and the Trustee on behalf of
Certificateholders (the "TRUST PARTIES") hereby authorize the Certificate
Insurer to include the information contained in reports provided to the
Certificate Insurer hereunder (the "INFORMATION") on The Bloomberg, an on-line
computer based information network maintained by Bloomberg L.P. ("BLOOMBERG"),
or in other electronic or print information services. The Trust Parties agree
not to commence any actions or proceedings, or otherwise assert any claims,
against the Certificate Insurer or its affiliates or any of the Certificate
Insurer's or its affiliates' respective agents, representatives, directors,
officers or employees (collectively, the "CERTIFICATE INSURER PARTIES"), arising
out of, or related to or in connection with the dissemination and/or use of any
Information by the Certificate Insurer, including, but not limited to, claims
based on allegations of inaccurate, incomplete or erroneous transfer of
information by the Certificate Insurer to Bloomberg or otherwise (other than in
connection with the Certificate Insurer's negligence or willful misconduct). The
Trust Parties waive their rights to assert any such claims against the
Certificate Insurer Parties and fully and finally release the Certificate
Insurer Parties from any and all such claims, demands, obligations, actions and
liabilities (other than in connection with the Certificate Insurer's negligence
or willful misconduct). The Certificate Insurer makes no representations or
warranties, expressed or implied, of any kind whatsoever with respect to the
accuracy, adequacy, timeliness, completeness, merchantability or fitness for any
particular purpose of any Information in any form or manner. The Certificate
Insurer reserves the right at any time to withdraw or suspend the dissemination
of the Information by the Certificate Insurer. The authorizations, covenants and
obligations of the Trust Parties under this section shall be irrevocable and
shall survive the termination of this Agreement.
Section 6.08 ADVANCES BY THE SERVICER.
Not later than the close of business on the third Business Day
preceding each Distribution Date, the Servicer shall remit to the Trustee (but
solely from and to the extent of amounts on deposit in the Principal and
Interest Account as of the related Determination Date, after giving effect to
withdrawals from the Principal and Interest Account as of the Determination Date
for such Distribution Date pursuant to SECTION 5.04(I)), an amount (the
"ADVANCE") equal to the sum of (a) the interest accrued in the related Due
Period on the Mortgage Loans but uncollected as of the close of business on the
last day of such Due Period (net of the Servicing Fee) and (b) with respect to
each REO Property which was acquired during or prior to the related Due Period
and as to which an REO Disposition did not occur during the related Due Period,
an amount equal to the excess, if any, of interest on the Principal Balance of
such REO Property computed at the related Mortgage Interest Rate (net of the
Servicing Fee (computed in the manner described in paragraph (i) or (ii), as
applicable, of the definition thereof)) for the most recently ended Due Period
over the net income from the REO Property deposited in the Principal and
Interest Account during such Due Period pursuant to SECTION 5.10.
Notwithstanding the provisions in the foregoing paragraph of this
SECTION 6.08, with respect to the Distribution Dates occurring on or before
December 27, 1999, if the amounts on deposit in the Principal and Interest
Account are insufficient to make the full Advance (as defined herein), and as a
result thereof an Event of Nonpayment would occur, the Servicer shall make an
Advance from its own funds equal to such insufficiency to the extent of
delinquent payments of interest and may reimburse itself for such Advances from
collections on the related Mortgage Loans pursuant to SECTION 5.04(II).
ARTICLE VII
GENERAL SERVICING PROCEDURES
Section 7.01 ASSUMPTION AGREEMENTS.
When a Mortgaged Property has been or is about to be conveyed by the
Mortgagor, the Servicer shall, to the extent it has knowledge of such conveyance
or prospective conveyance, exercise its rights to accelerate the maturity of the
related Mortgage Loan under any "due-on-sale" clause contained in the related
Mortgage or Mortgage Note; PROVIDED, HOWEVER, that the Servicer shall not
exercise any such right if the "due-on-sale" clause, in the reasonable belief of
the Servicer, is not enforceable under applicable law. In such event, the
Servicer shall enter into an assumption agreement with the person to whom such
property has been or is about to be conveyed, pursuant to which such person
becomes liable under the Mortgage Note and, unless prohibited by applicable law
or the Mortgage Documents, the Mortgagor remains liable thereon. The Servicer is
also authorized with the prior approval of the Certificate Insurer to enter into
a substitution of liability agreement with such person, pursuant to which the
original Mortgagor is released from liability and such person is substituted as
Mortgagor and becomes liable under the Mortgage Note. The Servicer shall notify
the Depositors, the Trustee and the Certificate Insurer that any such
substitution or assumption agreement has been completed by forwarding to the
Trustee (or to the Custodian on behalf of the Trustee) the original of such
substitution or assumption agreement and a duplicate thereof to the Depositors
and the Certificate Insurer, which original shall be added by the Trustee (or by
the Custodian on behalf of the Trustee) to the related Mortgage File and shall,
for all purposes, be considered a part of such Mortgage File to the same extent
as all other documents and instruments constituting a part thereof. In
connection with any assumption or substitution agreement entered into pursuant
to this SECTION 7.01, the Servicer shall not change the Mortgage Interest Rate
or the Monthly Payment, defer or forgive the payment of principal or interest,
reduce the outstanding principal amount or extend the final maturity date on
such Mortgage Loan. Any fee collected by the Servicer for consenting to any such
conveyance or entering into an assumption or substitution agreement shall be
retained by or paid to the Servicer as additional Servicing Compensation.
Notwithstanding the foregoing paragraph or any other provision of
this Agreement, the Servicer shall not be deemed to be in default, breach or any
other violation of its obligations hereunder by reason of any assumption of a
Mortgage Loan by operation of law or any assumption which the Servicer may be
restricted by law from preventing, for any reason whatsoever.
With respect to any mortgage loan secured by an interest in an
Illinois Land Trust, if the Servicer receives notice of the sale of the
beneficial interest in a Illinois Land Trust or the related Mortgaged Property
by the holder of a First Lien secured thereby to a Person other than the
Servicer, the Depositors or the Trustee, then, prior to distribution of any
proceeds of such sale, the Servicer shall demand in writing that such holder of
a First Lien pay the amount necessary to satisfy all indebtedness under the
Mortgage Loan from the proceeds of such sale. If such holder of a First Lien so
requests, the Servicer shall furnish reasonable proof of the Depositor's and
Trustee's interest with respect to such proceeds. Unless and until the Servicer
has received instruction otherwise from the Majority in Aggregate Voting
Interest (with the consent of the Certificate Insurer) or from the Certificate
Insurer, the Servicer shall, with respect to any such First Lien and the related
Mortgage Loan, follow servicing standards consistent with those of prudent
lending institutions in the geographic area where the Mortgaged Property is
located, including the making of any appropriate Servicing Advances with respect
thereto. In any event, the Servicer shall follow any instructions from the
Majority in Aggregate Voting Interest with the consent of the Certificate
Insurer or from the Certificate Insurer as soon as practicable following receipt
thereof.
Section 7.02 SATISFACTION OF MORTGAGES AND RELEASE OF
MORTGAGE FILES.
The Servicer shall not grant a satisfaction or release of a Mortgage
without having obtained payment in full of the indebtedness secured by the
Mortgage or otherwise prejudice any right the Certificateholders or the
Certificate Insurer may have under the mortgage instruments subject to SECTION
5.01 hereof. The Servicer shall maintain the Fidelity Bond as provided for in
SECTION 5.09 insuring the Servicer against any loss it may sustain with respect
to any Mortgage Loan not satisfied in accordance with the procedures set forth
herein.
Upon the payment in full of any Mortgage Loan, or the receipt by the
Servicer of a notification that payment in full will be escrowed in a manner
customary for such purposes, the Servicer will immediately notify the Trustee or
the Custodian on behalf of the Trustee by an Officers' Certificate in the form
of EXHIBIT B attached to the Custodial Agreement (which certification shall
include a statement to the effect that all amounts received or to be received in
connection with such payment which are required to be deposited in the Principal
and Interest Account pursuant to SECTION 5.03 have been or will be so deposited)
of a Servicing Officer and shall request delivery to it of the Mortgage File.
Upon receipt of such certification and request, the Trustee or the Custodian on
behalf of the Trustee shall promptly release the related Mortgage File to the
Servicer. Expenses incurred in connection with any instrument of satisfaction or
deed of reconveyance shall be payable by the Servicer and shall not be
reimbursed from the Principal and Interest Account or the Collection Account.
From time to time and as appropriate for the servicing or
foreclosure of any Mortgage Loan, including, for this purpose, collection under
any primary mortgage guaranty insurance policy, the Trustee or the Custodian on
behalf of the Trustee shall, upon request of the Servicer and delivery to the
Trustee or the Custodian on behalf of the Trustee of a certification in the form
of EXHIBIT B attached to the Custodial Agreement signed, by a Servicing Officer,
promptly release the related Mortgage File to the Servicer, and the Trustee
shall execute such documents as shall be necessary to the prosecution of any
such proceedings. Such servicing receipt shall obligate the Servicer to return
the Mortgage File or any document released therefrom to the Trustee or the
Custodian on behalf of the Trustee when the need therefor by the Servicer no
longer exists, unless the Mortgage Loan has been liquidated and the Net
Liquidation Proceeds relating to the Mortgage Loan have been deposited in the
Principal and Interest Account and remitted to the Trustee for deposit in the
Collection Account or the Mortgage File has been delivered to an attorney, or to
a public trustee or other public official as required by law, for purposes of
initiating or pursuing legal action or other proceedings for the foreclosure of
the Mortgaged Property either judicially or non-judicially, and the Servicer has
delivered to the Trustee a certificate of a Servicing Officer certifying as to
the name and address of the Person to which such Mortgage File or such document
was delivered and the purpose or purposes of such delivery. Upon receipt of a
certificate of a Servicing Officer stating that such Mortgage Loan was
liquidated, the servicing receipt shall be released promptly by the Trustee to
the Servicer.
The Trustee shall promptly execute and deliver to the Servicer any
legal notices, court pleadings, requests for trustee's sale in respect of a
Mortgaged Property or any legal action brought to obtain judgment against any
Mortgagor on the Mortgage Note or Mortgage or to obtain a deficiency judgment,
or to enforce any other remedies or rights provided by the Mortgage Note or
Mortgage or otherwise available at law or in equity. Together with such
documents or pleadings, the Servicer shall deliver to the Trustee a certificate
of a Servicing Officer requesting that such pleadings or documents be executed
by the Trustee and certifying as to the reason such documents or pleadings are
required and that the execution and delivery thereof by the Trustee will not
invalidate or otherwise affect the lien of the Mortgage, except for the
termination of such a lien upon completion of the foreclosure or trustee's sale.
The Trustee shall, upon receipt of a written request from a Servicing Officer,
execute any document provided to the Trustee by the Servicer or take any other
action requested in such request that is, in the opinion of the Servicer as
evidenced by such request, required by any state or other jurisdiction to
discharge the lien of a Mortgage upon the satisfaction thereof and the Trustee
will promptly sign and deliver, but will not guarantee receipt of, any such
documents to the Servicer, or such other party as the Servicer may direct,
within five Business Days, or more promptly if needed, of the Trustee's receipt
of such certificate or documents. Such certificate or documents shall establish
to the Trustee's satisfaction that the related Mortgage Loan has been paid in
full by or on behalf of the Mortgagor and that such payment has been deposited
in the Principal and Interest Account.
Section 7.03 SERVICING COMPENSATION.
As compensation for its services hereunder, the Servicer shall be
entitled to withdraw from the Principal and Interest Account (or, so long as the
Principal and Interest Account is maintained pursuant to SECTION 5.03(A)(Y),
note on its books that such funds are no longer funds with respect to the
Principal and Interest Account) or to retain from interest payments on the
Mortgage Loans, the Servicer's Servicing Fee. Additional servicing compensation
in the form of assumption and other administrative fees (including bad check
charges, late payment fees and similar fees), interest paid on funds on deposit
in the Principal and Interest Account, amounts remitted pursuant to SECTION
6.03(B)(IV) and Excess Proceeds shall be retained by or remitted to the
Servicer, to the extent not otherwise required to be remitted to the Trustee for
deposit in the Collection Account and not constituting the Representative's
Yield. The Servicer shall be required to pay all expenses incurred by it in
connection with its servicing activities hereunder and shall not be entitled to
reimbursement therefor except as specifically provided for herein. The
Representative's Yield is the property of the Representative, and not the
property of the Servicer, and such ownership shall not be affected by any
termination of the Servicer.
Section 7.04 ANNUAL STATEMENT AS TO COMPLIANCE.
The Servicer will deliver to the Certificate Insurer, the Trustee
and each Rating Agency, not later than the last day of the fourth month
following the end of the Servicer's fiscal year, which currently ends on
December 31, beginning with the fiscal year ending December 31, 1999, an
Officers' Certificate stating that (i) the Servicer has fully complied with the
provisions of ARTICLES V AND VIII, (ii) a review of the activities of the
Servicer during the preceding fiscal year and of performance under this
Agreement has been made under such officers' supervision, and (iii) to the best
of such officers' knowledge, based on such review, the Servicer has fulfilled
all its obligations under this Agreement throughout such year, or, if there has
been a default in the fulfillment of any such obligation, specifying each such
default known to such officers and the nature and status thereof and the action
being taken by the Servicer to cure such default. The Servicer shall promptly
notify the Certificate Insurer, the Trustee and each Rating Agency promptly upon
any change in the basis on which its fiscal year is determined.
Section 7.05 ANNUAL INDEPENDENT PUBLIC ACCOUNTANTS' SERVICING
REPORT.
Not later than the last day of the fourth month following the end of
the Servicer's fiscal year, beginning with the fiscal year ending December 31,
1999, the Servicer, at its expense, shall cause a firm of independent public
accountants reasonably acceptable to the Trustee and the Certificate Insurer to
furnish a letter or letters to the Certificate Insurer, the Trustee and each
Rating Agency to the effect that such firm has with respect to the Servicer's
overall servicing operations examined such operations in accordance with the
requirements of the Uniform Single Attestation Program for Mortgage Bankers, and
stating such firm's conclusions relating thereto.
Section 7.06 RIGHT TO EXAMINE SERVICER RECORDS.
The Trustee or the Trustee at the request of a Majority in Aggregate
Voting Interest (or the representatives thereof) and the Certificate Insurer
shall have the right upon reasonable prior notice, during normal business hours
and as often as reasonably required, to examine and audit any and all of the
books, records or other information of the Servicer, whether held by the
Servicer or by another on behalf of the Servicer, which may be relevant to the
performance or observance by the Servicer of the terms, covenants or conditions
of this Agreement.
Section 7.07 REPORTS TO THE TRUSTEE; PRINCIPAL AND INTEREST
ACCOUNT STATEMENTS.
Solely with respect to a Principal and Interest Account maintained
pursuant to SECTION 5.03(A)(X), if the Principal and Interest Account is not
maintained with the Trustee, then not later than 25 days after each Distribution
Date, the Servicer shall forward to the Certificate Insurer and the Trustee a
statement, certified by a Servicing Officer, setting forth the status of the
Principal and Interest Account as of the end of the preceding Due Period and
showing, for the period covered by such statement, the aggregate of deposits
into the Principal and Interest Account for each category of deposit specified
in SECTION 5.03, the aggregate of withdrawals from the Principal and Interest
Account for each category of withdrawal specified in SECTION 5.04, the aggregate
amount of permitted withdrawals not made in the related period, and the amount
of Advances, if any, for the related period.
ARTICLE VIII
REPORTS TO BE PROVIDED BY SERVICER
Section 8.01 FINANCIAL STATEMENTS.
The Servicer will furnish to the Certificate Insurer, the Depositors
or the Trustee on request unaudited financial statements of the Servicer.
The Servicer also agrees to make available on a reasonable basis to
the Certificate Insurer, the Depositor, the Trustee, any Certificateholder or
any prospective Certificateholder a knowledgeable financial or accounting
officer for the purpose of answering reasonable questions respecting recent
developments affecting the Servicer or the financial statements of the Servicer.
ARTICLE IX
THE SERVICER
Section 9.01 INDEMNIFICATION; THIRD PARTY CLAIMS.
The Servicer agrees to indemnify and hold the Depositors, the
Custodian, the Trustee, the Certificate Insurer and each Holder harmless against
any and all claims, losses, penalties, fines, forfeitures, legal fees and
related costs, judgments, and any other costs, fees and expenses that the
Trustee, the Custodian, the Certificate Insurer and any Holder may sustain in
any way related to the failure of the Servicer to perform its duties and service
the Mortgage Loans in compliance with the terms of this Agreement. The Servicer
shall immediately notify the Depositors, the Trustee, the Custodian, the
Certificate Insurer and each Certificateholder, if a claim is made by a third
party with respect to this Agreement, and the Servicer shall assume (with the
consent of the Trustee and the Certificate Insurer) the defense of any such
claim and advance all expenses in connection therewith, including reasonable
counsel fees, and promptly advance funds to pay, discharge and satisfy any
judgment or decree which may be entered against the Servicer, the Trustee, the
Certificate Insurer and/or any Certificateholder in respect of such claim. The
Trustee may, if necessary, reimburse the Servicer from amounts otherwise
distributable on the Class X Certificates for all amounts advanced by it
pursuant to the preceding sentence except when the claim relates directly to the
failure of the Servicer to service and administer the Mortgage Loans in
compliance with the terms of this Agreement. The Servicer shall have no lien on
the assets of the Trust with respect to amounts advanced pursuant to this
SECTION 9.01 directly as a result of Servicer's failure to service and
administer the Mortgage Loans in compliance with the terms of this Agreement.
Section 9.02 MERGER OR CONSOLIDATION OF THE SERVICER.
The Servicer will each keep in full effect its existence, rights and
franchises as a corporation and will obtain and preserve its qualification to do
business as a foreign corporation, in each jurisdiction necessary to protect the
validity and enforceability of this Agreement or any of the Mortgage Loans and
to perform its duties under this Agreement.
Any Person into which the Servicer may be merged or consolidated, or
any corporation resulting from any merger, conversion or consolidation to which
the Servicer or the Representative shall be a party, or any Person succeeding to
the business of the Servicer, shall be an established mortgage loan servicing
institution that has a net worth of at least $15,000,000 and shall be the
successor of the Servicer or the Representative, as applicable 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. The
Servicer shall send notice of any such merger or consolidation to the Trustee,
the Certificate Insurer and each Rating Agency.
Section 9.03 LIMITATION ON LIABILITY OF THE SERVICER AND
OTHERS.
The Servicer and any director, officer, employee or agent of the
Servicer may rely on any document of any kind which it in good faith reasonably
believes to be genuine and to have been adopted or signed by the proper
authorities respecting any matters arising hereunder. Subject to the terms of
SECTION 9.01 herein, the Servicer shall have no obligation to appear with
respect to, prosecute or defend, any legal action which is not incidental to the
Servicer's duty to service the Mortgage Loans in accordance with this Agreement.
Section 9.04 SERVICER NOT TO RESIGN.
The Servicer shall not assign this Agreement nor resign from the
obligations and duties hereby imposed on it except by mutual consent of the
Servicer, the Representative (if the Representative is not the Servicer), the
Certificate Insurer, the Trustee and the Majority in Aggregate Voting Interest,
or upon the determination that the Servicer's duties hereunder are no longer
permissible under applicable law and such incapacity cannot be cured by the
Servicer. Any such determination permitting the resignation of the Servicer
shall be evidenced by a written Opinion of Counsel (who may be counsel for the
Servicer) to such effect delivered to the Trustee, the Representative (if the
Representative is not the Servicer) and the Certificate Insurer, which Opinion
of Counsel shall be in form and substance acceptable to the Certificate Insurer
and the Trustee. No such resignation shall become effective until a successor
has assumed the Servicer's responsibilities and obligations hereunder in
accordance with SECTION 9.02. The Servicer shall promptly notify each Rating
Agency promptly of its intention to resign pursuant to this SECTION 9.04.
Section 9.05 REMOVAL OF SERVICER.
The Certificate Insurer or the Holders of Certificates representing
a Majority in Aggregate Voting Interest may, with the prior written consent of
the Certificate Insurer, remove the Servicer upon the occurrence of and
continuation of a Servicer Default upon 90 days' prior written notice to the
Servicer. No such removal shall become effective until a successor (other than
the Trustee, unless the Trustee agrees to so act) has assumed the Servicer's
responsibilities and obligations hereunder in accordance with SECTION 9.02. The
Servicer shall promptly notify each Rating Agency of such removal.
<PAGE>
ARTICLE X
SERVICER DEFAULT
Section 10.01 SERVICER DEFAULT.
(a) In case one or more of the following events (each a "SERVICER
DEFAULT") by the Servicer shall occur and be continuing:
(i) (A) an Event of Nonpayment (subject to paragraph (c) below);
(B) the failure by the Servicer to make any required Servicing Advance
(other than a Nonrecoverable Advance), to the extent such failure
materially and adversely affects the interests of the Certificate Insurer
or the Certificateholders; (C) the failure by the Servicer to make a
required Advance (other than a Nonrecoverable Advance) pursuant to the
second paragraph of SECTION 6.08; or (d) any other failure by the Servicer
to remit to the Trustee for the benefit of any Holders, any payment
required to be made under the terms of this Agreement (other than a
Nonrecoverable Advance) which continues unremedied after the date upon
which written notice of such failure, requiring the same to be remedied,
shall have been given to a Servicing Officer of the Servicer by the
Certificate Insurer, the Trustee or to a Servicing Officer of the Servicer
and the Trustee by any Holder;
(ii) the failure by the Servicer duly to observe or perform, in
any material respect, any other covenants, obligations or agreements of
the Servicer as set forth in this Agreement, which failure continues
unremedied for a period of 30 days after the date on which written notice
of such failure, requiring the same to be remedied, shall have been given
to the Servicer by the Certificate Insurer or the Trustee or to the
Servicer and the Trustee by any Holder or the Certificate Insurer;
(iii) a decree or order of a court or agency or supervisory
authority having jurisdiction for the appointment of a conservator or
receiver or liquidator in any insolvency, readjustment of debt, marshaling
of assets and liabilities or similar proceedings, or for the winding-up or
liquidation of its affairs, shall have been entered against the Servicer
and such decree or order shall have remained in force, undischarged or
unstayed for a period of 60 days;
(iv) the Servicer shall consent to the appointment of a
conservator or receiver or liquidator in any insolvency, readjustment of
debt, marshaling of assets and liabilities or similar proceedings of or
relating to the Servicer or of or relating to all or substantially all of
the Servicer's property;
(v)the Servicer shall admit in writing its inability to pay its
debts as they become due, file a petition to take advantage of any
applicable insolvency or reorganization statute, make an assignment for
the benefit of its creditors, or voluntarily suspend payment of its
obligations;
(vi) the Servicer shall fail for 60 days to pay, or bond against,
an unappealable, undischarged, unvacated and unstayed final judgment by a
court of competent jurisdiction in an aggregate amount of $250,000 or
more; or
(vii) the occurrence of a Servicer Delinquency Rate Trigger or a
Servicer Cumulative Loss Trigger.
(b) then, and in each and every such case, so long as such Servicer
Default shall not have been remedied, and in the case of CLAUSE (I) above
(except for clause (i)(C)), if such Servicer Default shall not have been
remedied within three Business Days after the Servicer has received notice of
such Servicer Default, (x) with respect solely to CLAUSE (I)(C) above, if such
Advance is not made by 4:00 p.m. New York time on the second Business Day prior
to the applicable Distribution Date, the Certificate Insurer or the Trustee,
upon receipt of written notice or discovery by a Responsible Officer of such
failure, shall give immediate telephonic notice of such failure to a Servicing
Officer of the Servicer, and the Trustee shall notify each Certificateholder
and, unless such failure is cured, either by receipt of payment or receipt of
evidence satisfactory to the Certificate Insurer (E.G., a wire reference number
communicated by the sending bank; the Certificate Insurer shall notify the
Trustee, if the Certificate Insurer receives satisfactory evidence that such
funds have been sent), by 12:00 noon New York time on the following Business
Day, the Trustee, or a successor servicer appointed in accordance with SECTION
10.02, shall immediately make such Advance (unless such Advance is a
Nonrecoverable Advance) and assume, pursuant to SECTION 10.02 hereof, the duties
of a successor Servicer; and (y) in the case of CLAUSES (I)(A), (I)(B), (I)(D),
(II), (III), (IV), (V), (VI) AND (VII) above, the Majority in Aggregate Voting
Interest, subject to the prior written consent of the Certificate Insurer, which
consent may not be unreasonably withheld, or the Certificate Insurer, by notice
in writing to the Servicer and a Responsible Officer of the Trustee may, in
addition to whatever rights they or it may have at law or equity to damages,
including injunctive relief and specific performance, commence termination of
all the rights and obligations of the Servicer under this Agreement and in and
to the Mortgage Loans and the proceeds thereof, as servicer. Upon receipt by the
Servicer of a second written notice (except relative to clause (i)(C) above)
from the Majority in Aggregate Voting Interest, subject to the prior written
consent of the Certificate Insurer, which consent may not be unreasonably
withheld, or the Certificate Insurer stating that they or it intend to terminate
the Servicer as a result of such Servicer Default, all authority and power of
the Servicer under this Agreement, whether with respect to the Mortgage Loans or
otherwise, shall, subject to SECTION 10.02, pass to and be vested in the Trustee
or its designee and the Trustee is hereby authorized and empowered to execute
and deliver, on behalf of the Servicer, as attorney-in-fact or otherwise, any
and all documents and other instruments and do or cause to be done all other
acts or things necessary or appropriate to effect the purposes of such notice of
termination, including, but not limited to, the transfer and endorsement or
assignment of the Mortgage Loans and related documents to the extent required by
this Agreement. The Servicer agrees to cooperate with the Trustee in effecting
the termination of the Servicer's responsibilities and rights hereunder,
including, without limitation, the transfer to the Trustee, for the benefit of
the Holders of the Certificates, or its designee for administration by it of all
amounts which shall at the time be credited by the Servicer to the Principal and
Interest Account or thereafter received with respect to the Mortgage Loans.
The Trustee shall not be deemed to have knowledge of a Servicer
Default unless a Responsible Officer thereof has received written notice
thereof.
(c) Notwithstanding anything to the contrary contained in this
Agreement, upon the occurrence of an Event of Nonpayment or a Performance
Default of which the Certificate Insurer has knowledge, the Certificate Insurer
shall promptly notify the Trustee. During any applicable grace period following
receipt of such notice (or immediately following such notice in the case of a
Performance Default), the Trustee and the Certificate Insurer shall cooperate
with each other to determine if the occurrence of such Event of Nonpayment is in
their reasonable business judgment or Performance Default is in the reasonable
business judgment of the Certificate Insurer (x) the result of the acts or
omissions of the Servicer or (y) the result of events beyond the control of the
Servicer. If the Trustee and the Certificate Insurer conclude that such Event of
Nonpayment or Performance Default is the result of the latter, SECTION 10.01(B)
above shall not apply, and the Servicer shall not be terminated, unless and
until an Event of Default unrelated to such Event of Nonpayment or Performance
Default has occurred and is continuing, whether or not the Servicer has cured
such Event of Nonpayment or Performance Default. If the Trustee and the
Certificate Insurer conclude that the Event of Nonpayment or Performance Default
is the result of the former, the Certificate Insurer or the Majority in
Aggregate Voting Interest, as the case may be, may terminate the Servicer in
accordance with SECTION 10.01(B) above, provided that the Trustee shall have
until the 60th day following the date of receipt of notice of the Event of
Nonpayment or Performance Default to either assume the servicing or appoint a
successor servicer pursuant to SECTION 10.02 hereof.
If the Trustee and the Certificate Insurer cannot agree, and the
basis for such disagreement is not arbitrary or unreasonable, as to the cause of
the Event of Nonpayment or Performance Default, the decision of the Certificate
Insurer shall control; PROVIDED, HOWEVER, that if the Certificate Insurer
decides to terminate the Servicer, the Trustee shall be relieved of its
obligation to assume the servicing or to appoint a successor, which shall be the
exclusive obligation of the Certificate Insurer.
The Trustee shall promptly notify each Rating Agency, the
Certificate Insurer, the Trustee and each Certificateholder, of the occurrence
of a Servicer Default.
Section 10.02 TRUSTEE TO ACT; APPOINTMENT OF SUCCESSOR SERVICER.
On and after the time the Servicer receives a notice of termination
pursuant to SECTION 10.01, or the Trustee receives the resignation of the
Servicer evidenced by an Opinion of Counsel pursuant to SECTION 9.04, or the
Servicer is removed as servicer pursuant to this ARTICLE X (in which event the
Trustee shall promptly notify each Rating Agency), except as otherwise provided
in SECTION 10.01, the Trustee shall be the successor in all respects to the
Servicer in its capacity as servicer under this Agreement and the transactions
set forth or provided for herein and shall be subject to all the
responsibilities, duties and liabilities relating thereto placed on the Servicer
by the terms and provisions hereof; PROVIDED, HOWEVER, that the Trustee shall
not be liable for any actions of any servicer prior to the Trustee becoming the
Servicer under this Agreement. The Trustee shall be obligated to make advances
pursuant to SECTIONS 5.10, 5.13 AND 6.08 unless, and only to the extent the
Trustee determines reasonably and in good faith that, such advances would not be
recoverable pursuant to SECTION 5.04(II) OR 6.05(D), such determination to be
evidenced by a certification of a Responsible Officer of the Trustee delivered
to the Certificate Insurer; provided that the Trustee shall not be required to
make an advance from its own funds if such advance is prohibited by law. As
compensation therefor, the Trustee, or any successor servicer appointed pursuant
to the following paragraph, shall be entitled to all funds relating to the
Mortgage Loans which the Servicer would have been entitled to receive from the
Principal and Interest Account pursuant to SECTION 5.04 and from the Collection
Account pursuant to SECTION 6.05 if the Servicer had continued to act as
servicer hereunder, together with other servicing compensation in the form of
assumption fees, late payment charges or otherwise as provided in SECTIONS 7.01
AND 7.03. In no event shall the assets of the Trust include, nor the Trustee or
any other successor servicer acquire any rights to, the Representative's Yield.
Notwithstanding the above, the Trustee may, if it shall be unwilling
to so act, and shall, if it is unable to so act or if the Majority in Aggregate
Voting Interest (with the consent of the Certificate Insurer), or the
Certificate Insurer so request in writing to the Trustee, appoint, or petition a
court of competent jurisdiction to appoint, any established mortgage loan
servicing institution acceptable to the Certificate Insurer, which acceptance
shall not be unreasonably withheld, that has a net worth of not less than
$15,000,000 and which is approved as a servicer by FNMA and FHLMC as the
successor to the Servicer hereunder in the assumption of all or any part of the
responsibilities, duties or liabilities of the Servicer hereunder. Any
collections received by the Servicer after removal or resignation shall be
endorsed by it to the Trustee and remitted directly to the Trustee or, at the
direction of the Trustee, to the successor servicer. The compensation of any
successor servicer (including, without limitation, the Trustee) so appointed
shall be the aggregate Servicing Fees, together with other Servicing
Compensation in the form of assumption fees, late payment charges or otherwise.
In the event the Trustee is required to solicit bids, the Trustee shall solicit,
by public announcement, bids from housing and home finance institutions, banks
and mortgage servicing institutions meeting the qualifications set forth above.
Such public announcement shall specify that the successor servicer shall be
entitled to the full amount of the aggregate Servicing Fees as servicing
compensation, together with the other servicing compensation in the form of
assumption fees, late payment charges or otherwise. Within thirty days after any
such public announcement, the Trustee shall negotiate and effect the sale,
transfer and assignment of the servicing rights and responsibilities hereunder
to the qualified party submitting the highest qualifying bid. The Trustee shall
deduct from any sum received by the Trustee from the successor to the Servicer
in respect of such sale, transfer and assignment all costs and expenses of any
public announcement and of any sale, transfer and assignment of the servicing
rights and responsibilities hereunder and the amount of any unreimbursed
Servicing Advances and Advances. After such deductions, the remainder of such
sum shall be paid by the Trustee to the Servicer at the time of such sale,
transfer and assignment to the Servicer's successor. The Trustee and such
successor shall take such action, consistent with this Agreement, as shall be
necessary to effectuate any such succession. The Servicer agrees to cooperate
with the Trustee and any successor servicer in effecting the termination of the
Servicer's servicing responsibilities and rights hereunder and shall promptly
provide the Trustee or such successor servicer, as applicable, all documents and
records reasonably requested by it to enable it to assume the Servicer's
functions hereunder and shall promptly also transfer to the Trustee or such
successor servicer, as applicable, all amounts which then have been or should
have been deposited in the Principal and Interest Account by the Servicer or
which are thereafter received with respect to the Mortgage Loans. Neither the
Trustee nor any other successor servicer shall be held liable by reason of any
failure to make, or any delay in making, any distribution hereunder or any
portion thereof caused by (i) the failure of the Servicer to deliver, or any
delay in delivering, cash, documents or records to it, or (ii) restrictions
imposed by any regulatory authority having jurisdiction over the Servicer
hereunder. No appointment of a successor to the Servicer hereunder (other than
the Trustee) shall be effective until the Trustee and the Certificate Insurer
shall have consented thereto. The Trustee shall not resign as servicer until a
successor servicer reasonably acceptable to the Certificate Insurer has been
appointed.
Pending appointment of a successor to the Servicer hereunder, the
Trustee shall act in such capacity as hereinabove provided. In connection with
such appointment and assumption, the Trustee may make such arrangements for the
compensation of such successor out of payments on Mortgage Loans as it and such
successor shall agree; PROVIDED, HOWEVER, that no such compensation shall be in
excess of that permitted the Servicer pursuant to SECTION 8.03, together with
other servicing compensation in the form of assumption fees, late payment
charges or otherwise as provided in this Agreement. The Servicer, the Trustee,
any Custodian and such successor shall take such action, consistent with this
Agreement, as shall be necessary to effectuate any such succession.
Section 10.03 WAIVER OF DEFAULTS.
The Certificate Insurer or a Majority in Aggregate Voting Interest
may, on behalf of all Certificateholders, and subject to the consent of the
Certificate Insurer, which consent may not be unreasonably withheld, waive any
events permitting removal of the Servicer as servicer pursuant to this ARTICLE
X. Upon any waiver of a past default, such default shall cease to exist, and any
Servicer Default arising therefrom shall be deemed to have been remedied for
every purpose of this Agreement. No such waiver shall extend to any subsequent
or other default or impair any right consequent thereto except to the extent
expressly so waived. Notice of any such waiver shall be given by the Trustee to
each Rating Agency.
Section 10.04 CONTROL BY MAJORITY IN AGGREGATE VOTING Interest.
The Certificate Insurer, or the Majority in Aggregate Voting
Interest with the consent of the Certificate Insurer, which consent may not be
unreasonably withheld, may direct the time, method and place of conducting any
proceeding relating to the assets of the Trust or the Certificates or for any
remedy available to the Trustee with respect to the Certificates, or exercising
any trust or power conferred on the Trustee with respect to the Certificates or
the assets of the Trust, provided that:
(i) such direction shall not be in conflict with any rule of
law or with this Agreement;
(ii) the Trustee shall have been provided with indemnity
satisfactory to it; and
(iii) the Trustee may take any other action deemed proper by it
which is not inconsistent with such direction; PROVIDED, HOWEVER, that the
Trustee need not take any action which it determines might involve it in
liability or may be unjustly prejudicial to the Holders not so directing.
If inconsistent directions are given, the Certificate Insurer's directions
shall control.
<PAGE>
ARTICLE XI
TERMINATION
Section 11.01 TERMINATION.
Subject to SECTION 11.03, this Agreement shall terminate upon notice
to the Trustee of either: (a) the collection with respect to the last Mortgage
Loan (or Advances of same by the Servicer), or the disposition of all funds with
respect to the last Mortgage Loan and the remittance of all funds due hereunder
and the payment of all amounts due and payable to the Certificate Insurer and
the Trustee or (b) mutual consent of the Servicer, the Certificate Insurer and
all Certificateholders in writing.
Subject to SECTION 11.03, the Servicer may, at its option, elect to
terminate this Agreement on any Distribution Date on or following the first
Distribution Date on which the Pool Principal Balance as of the last day of the
related Due Period is less than 10% of the Original Pool Principal Balance (such
Distribution Date being the "OPTIONAL PURCHASE DATE") by purchasing from the
Trust on such Distribution Date, all of the outstanding Mortgage Loans and REO
Properties at a price (the "TERMINATION PRICE") equal to the fair market value
thereof (determined as provided below); provided, that the Trust shall not sell
the Mortgage Loans and REO Properties if the Termination Price to be received is
less than the sum of (x) 100% of the aggregate Principal Balance of the
outstanding Mortgage Loans and REO Properties and (y) accrued and unpaid
interest on each such Mortgage Loan at a rate equal to its respective Mortgage
Interest Rate and (z) any unpaid Interest Carryover. In connection with any such
sale, the Servicer shall pay any outstanding and unpaid fees and expenses of the
Trustee and the Certificate Insurer relating to this Agreement that such parties
would otherwise have been entitled to pursuant to SECTION 6.05(D).
The fair market value of the outstanding Mortgage Loans and REO
Properties for purposes of this Section 11.01 shall be an amount equal to the
average of the bid prices for such assets taken as a whole, provided to the
Servicer by two Independent, nationally recognized dealers in whole loans
substantially similar to the Mortgage Loans.
Any such sale pursuant to this SECTION 11.01 shall be accomplished
by depositing into the REMIC I Distribution Account, on the third Business Day
immediately preceding the final Distribution Date on which such purchase is to
be effected, the amount of the Termination Price. On the same day that the
Termination Price is deposited into the REMIC I Distribution Account, any other
amounts then on deposit in the Principal and Interest Account shall be
transferred to the REMIC I Distribution Account pursuant to Section 5.04(i) for
payment to the Trustee as Holder of the REMIC I Regular Interests, REMIC II
Regular Interests, REMIC III Regular Interests and REMIC IV Regular Interests
pursuant to Section 6.05(e) and to Certificateholders and the Certificate
Insurer pursuant to Section 6.05(d) on the final Distribution Date as specified
in the notice to Certificateholders described below; provided, that the amount
of any unpaid Class A-1A LIBOR Interest Carryover, Fixed Rate Group 1 Interest
Carryover or Fixed Rate Group 2 Interest Carryover, respectively, shall not be
paid from any of the Trust REMICs but shall be treated as paid directly from the
purchaser of the Mortgage Loans to the Class A-1A Certificateholders, the Fixed
Rate Group 1 Certificateholders and the Fixed Rate Group 2 Certificateholders,
respectively. Any amounts received with respect to the Mortgage Loans and REO
Properties subsequent to the last day of the related Due Period shall belong to
the Person purchasing the Mortgage Loans and REO Properties. Promptly upon
receipt of the Termination Price, the Trustee shall release (or cause to be
released) each related Mortgage File to the Person purchasing the Mortgage Loans
and REO Properties as set forth herein.
Notice of any termination, specifying the Distribution Date upon
which this Agreement will terminate shall be given promptly by the Trustee by
letter to the Certificateholders mailed during the month of such final
Distribution Date before the Determination Date in such month, specifying (i)
the Distribution Date upon which final payment of the Certificates will be made
and (ii) the amount of any such final payment. The obligations of the
Certificate Insurer hereunder shall terminate upon the deposit by the Servicer
with the Trustee for deposit into the REMIC I Distribution Account of a sum
sufficient to purchase all of the Mortgage Loans and REO Properties as set forth
above.
Each Holder is required, and hereby agrees, to return to the Trustee
any Certificate with respect to which the Trustee has made the final
distribution due thereon. Any such Certificate as to which the Trustee has made
the final distribution thereon shall be deemed canceled and shall no longer be
outstanding for any purpose of this Agreement, whether or not such Certificate
is ever returned to the Trustee.
In the event that any amount due to any Class A Certificateholder
remains unclaimed, the Servicer shall, at the expense of the Trust Fund, which
amount shall be allocated to REMIC IV, cause to be published once, in the
eastern edition of The Wall Street Journal, notice that such money remains
unclaimed. If, within the period then specified in the escheat laws of the State
of New York after such publication such amount remains unclaimed, the Class R-IV
Certificateholders shall be entitled to all unclaimed funds, and other assets
which remain subject hereto and the Trustee upon transfer of such funds shall be
discharged of any responsibility for such funds and the Certificateholders shall
look to the Class R-IV Certificateholders for payment.
Section 11.02 ADDITIONAL TERMINATION REQUIREMENTS.
In the event the Servicer exercises its purchase option as provided
in SECTION 11.01, the Trust Fund shall be terminated in accordance with the
following additional requirements, unless the Trustee has been furnished with an
Opinion of Counsel to the effect that the failure of the Trust Fund to comply
with the requirements of this SECTION 11.02 will not (i) result in the
imposition of taxes on prohibited transactions" of any Trust REMIC as defined in
Section 860F of the Code, or (ii) cause any Trust REMIC to fail to qualify as a
REMIC at any time that any Certificates are outstanding:
(i)Within 89 days prior to the final Distribution Date the
Trustee shall designate a date as the date of adoption of a plan of
complete liquidation of such REMIC under Section 860F of the Code and any
regulations thereunder and shall specify such date in the Trust REMICs'
final federal income tax returns;
(ii) At or after the date 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 Servicer or the Certificate Insurer
for cash;
(iii) At the time of the making of the final payment on the
Certificates, the Trustee shall distribute or credit, or cause to be
distributed or credited (A) to each Class of Class A Certificates, the
Certificate Balance thereof, together with one month's interest at the
related Pass-Through Rate and any unpaid Interest Carryover, (B) after
such payments to the Class A Certificateholders, to the Class X
Certificateholders any Unpaid Class X Remittance Amount and (C) to the
Class R-I Certificateholders, all cash on hand after such payment to the
Class A and Class X Certificateholders (other than cash retained to meet
claims), and the Trust REMICs and the Trust Fund shall terminate at such
time; and
(iv) In no event may the final payment on the Certificates
(except to the extent permitted in Section 11.01 with respect to
Certificateholders who fail to surrender their Certificates) be made after
the 89th day from the date of such plan of complete liquidation.
Section 11.03 ACCOUNTING UPON TERMINATION OF SERVICER.
Upon termination of the Servicer under ARTICLE X hereof, the
Servicer shall:
(a) deliver to its successor or, if none shall yet have been
appointed, to the Trustee the funds in any Principal and Interest Account;
(b) deliver to its successor or, if none shall yet have been
appointed, to the Trustee, the Mortgage Files and related documents and
statements held by it hereunder and a Mortgage Loan portfolio computer tape;
(c) deliver to its successor or, if none shall yet have been
appointed, to the Trustee and, upon request, to the Certificateholders, a full
accounting of all funds, including a statement showing the Monthly Payments
collected by it and a statement of monies held in trust by it for the payments
or charges with respect to the Mortgage Loans; and
(d) execute and deliver such instruments and perform all acts
reasonably requested in order to effect the orderly and efficient transfer of
servicing of the Mortgage Loans to its successor and to more fully and
definitively vest in such successor all rights, powers, duties,
responsibilities, obligations and liabilities of the Servicer under this
Agreement.
Section 11.04 REPRESENTATIVE'S RIGHT TO REPRESENTATIVE'S YIELD
ABSOLUTE.
The Representative's right to receive the Representative's Yield
with respect to each Mortgage Loan shall be absolute and unconditional, and
shall survive notwithstanding the termination of the rights and obligations of
the Servicer hereunder, the resignation of the Servicer or the termination of
this Agreement. The Representative's right to receive the Representative's Yield
shall not be subject to offset or counterclaim, whether or not such right has
been assigned in whole or in part, notwithstanding any breach of any
representation or warranty of the Representative or any Depositor under this
Agreement or any default by the Representative or any Depositor of any of its
obligations or covenants under this Agreement. The Representative shall have the
right to assign any or all of its rights in and to the Representative's Yield,
without notice to or the consent of any party to this Agreement or any
Certificateholder.
Section 11.05 TERMINATION UPON LOSS OF REMIC STATUS.
(a) Following a final determination by the Internal Revenue Service,
or by a court of competent jurisdiction, in either case, from which no appeal is
taken within the permitted time for such appeal, or if any appeal is taken,
following a final determination of such appeal from which no further appeal can
be taken, to the effect that any Trust REMIC does not and will no longer qualify
as a REMIC pursuant to Section 860D of the Code (the "FINAL DETERMINATION"), at
any time on or after the date which is 30 calendar days following such Final
Determination (i) the Majority in Voting Interest may direct the Trustee on
behalf of each Trust REMIC to adopt a "plan of complete liquidation" (within the
meaning of Section 860F(a)(4)(B)(i) of the Code) and (ii) the Certificate
Insurer may notify the Trustee of the Certificate Insurer's determination to
purchase from the Trust Fund all Mortgage Loans and all property theretofore
acquired by foreclosure, deed in lieu of foreclosure, or otherwise in respect of
any Mortgage Loan then remaining in the Trust Fund at a price equal to the
Termination Price. Upon receipt of notice from the Certificate Insurer, the
Trustee shall notify the Class R-I Certificateholders of such election to
liquidate or such determination to purchase, as the case may be (the
"TERMINATION NOTICE"). The Holders of a majority of the Percentage Interest of
the Class R-I Certificates then outstanding may, within 60 days from the date of
receipt of the Termination Notice (the "PURCHASE OPTION PERIOD"), at their
option, purchase from the Trust all Mortgage Loans and all property theretofore
acquired by foreclosure, deed in lieu of foreclosure, or otherwise in respect of
any Mortgage Loan then remaining in the Trust Fund at a purchase price equal to
the Termination Price. Any such purchase shall be accomplished in the manner set
forth in SECTION 11.01.
(b) If, during the Purchase Option Period, the Class R-I
Certificateholders have not exercised the option described in the immediately
preceding paragraph, then upon the expiration of the Purchase Option Period (i)
in the event that the Majority in Aggregate Voting Interest have given the
Trustee the direction described in clause (a)(i) above, the Trustee shall sell
the Mortgage Loans and distribute the proceeds of the liquidation of the Trust
Fund, each in accordance with the plan of complete liquidation, such that, if so
directed, the liquidation of the Trust Fund, the distribution of the proceeds of
the liquidation and the termination of this Agreement occur no later than the
close of the 60th day, or such later day as the Majority in Aggregate Voting
Interest shall permit or direct in writing, after the expiration of the Purchase
Option Period and (ii) in the event that the Certificate Insurer has given the
Trustee notice of the Certificate Insurer's determination to purchase the Trust
Fund described in clause (a)(ii) preceding, the Certificate Insurer shall so
purchase the Trust Fund within 60 days after the expiration of the Purchase
Option Period.
(c) Following a Final Determination, the Holders of a majority of
the Percentage Interest of the Class R-I Certificates then outstanding may, at
their option and upon delivery to the Class A and Class X Certificateholders and
the Certificate Insurer of an opinion of nationally recognized tax counsel
selected by the Holders of the Class R-I Certificates, which opinion shall be
reasonably satisfactory in form and substance to the Majority in Aggregate
Voting Interest and the Certificate Insurer, to the effect that the effect of
the Final Determination is to increase substantially the probability that the
gross income of each Trust REMIC will be subject to federal taxation, purchase
from the Trust Fund all Mortgage Loans and all property theretofore acquired by
foreclosure, deed in lieu of foreclosure, or otherwise in respect of any
Mortgage Loan then remaining in the Trust Fund at a purchase price equal to the
Termination Price. Any such purchase shall be accomplished in the manner set
forth in SECTION 11.01. The foregoing opinion shall be deemed satisfactory
unless the Majority in Aggregate Voting Interest give the Holders of a majority
of the Percentage Interest of the Class R-I Certificates notice that such
opinion is not satisfactory within thirty days after receipt of such opinion.
ARTICLE XII
THE TRUSTEE
Section 12.01 DUTIES OF TRUSTEE.
The Trustee, prior to the occurrence of a Servicer Default and after
the curing of all Servicer Defaults which may have occurred, undertakes to
perform such duties and only such duties as are specifically set forth in this
Agreement. If a Servicer Default has occurred and has not been cured or waived,
the Trustee shall exercise such of the rights and powers vested in it by this
Agreement, and use the same degree of care and skill in its exercise as a
prudent person would exercise or use under the circumstances in the conduct of
such person's own affairs.
The Trustee, upon receipt of all resolutions, certificates,
statements, opinions, reports, documents, orders or other instruments furnished
to the Trustee which are specifically required to be furnished pursuant to any
provision of this Agreement, shall examine them to determine whether they
conform to the requirements of this Agreement; PROVIDED, however, that the
Trustee shall not be responsible for the accuracy or content of any resolution,
certificate, statement, opinion, report, document, order or other instrument
furnished by the Servicer or either Depositor hereunder. If any such instrument
is found not to conform to the requirements of this Agreement, the Trustee shall
notify the Certificate Insurer and request written instructions as to the action
it deems appropriate to have the instrument corrected, and if the instrument is
not so corrected, the Trustee will provide notice thereof to the Certificate
Insurer who shall then direct the Trustee as to the action, if any, to be taken.
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) Prior to the occurrence of a Servicer Default, and after the
curing of all Servicer Defaults which may have occurred, the duties and
obligations of the Trustee shall be determined solely by the express
provisions of this Agreement, the Trustee shall not be liable except for
the performance of such duties and obligations as are specifically set
forth in this Agreement, no implied covenants or obligations shall be read
into this Agreement against the Trustee and, in the absence of bad faith
on the part of the Trustee, the Trustee may conclusively rely, as to the
truth of the statements and the correctness of the opinions expressed
therein, upon any certificates or opinions furnished to the Trustee and
conforming to the requirements of this Agreement;
(ii) The Trustee shall not be personally liable for an error of
judgment made in good faith by a Responsible Officer or other officers of
the Trustee, unless it shall be proved that the Trustee was negligent in
ascertaining the pertinent facts;
(iii) The Trustee shall not be personally liable with respect to
any action taken, suffered or omitted to be taken by it in good faith in
accordance with the direction of the Certificate Insurer or the Class A
Certificateholders, relating to the time, method and place of conducting
any proceeding for any remedy available to the Trustee, or exercising any
trust or power conferred upon the Trustee, under this Agreement;
(iv) The Trustee shall not be required to take notice or be
deemed to have notice or knowledge of any Default or Servicer Default
unless a Responsible Officer of the Trustee shall have received notice
thereof. In the absence of receipt of such notice, the Trustee may
conclusively assume that there is no default or Servicer Default;
(v) The Trustee shall not be required to expend or risk its own
funds or otherwise incur financial liability for the performance of any of
its duties hereunder or the exercise of any of its rights or powers if
there is reasonable ground for believing that the repayment of such funds
or adequate indemnity against such risk or liability is not reasonably
assured to it, and none of the provisions contained in this Agreement
shall in any event require the Trustee to perform, or be responsible for
the manner of performance of, any of the obligations of the Servicer under
this Agreement except during such time, if any, as the Trustee shall be
the successor to, and be vested with the rights, duties, powers and
privileges of, the Servicer in accordance with the terms of this
Agreement;
(vi) Subject to the other provisions of this Agreement and
without limiting the generality of this Section, 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, (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 or
any Trust REMIC, (d) to confirm or verify the contents of any reports or
certificates of the Servicer delivered to the Trustee pursuant to this
Agreement believed by the Trustee to be genuine and to have been signed or
presented by the proper party or parties; and
(vii) The Trustee shall not be deemed a fiduciary for the
Certificate Insurer in its capacity as such, except to the extent the
Certificate Insurer has made an Insured Payment and is thereby subrogated
to the rights of the Certificateholders with respect thereto.
Section 12.02 CERTAIN MATTERS AFFECTING THE TRUSTEE.
(a) Except as otherwise provided in SECTION 12.01:
(i)The Trustee may rely and shall be protected in acting or
refraining from acting upon any resolution, Officers' 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 Opinion of
Counsel shall be full and complete authorization and protection in respect
of any action taken or suffered or omitted by it hereunder in good faith
and in accordance with such Opinion of Counsel;
(iii) The Trustee shall be under no obligation to exercise any of
the trusts or powers vested in it by this Agreement or to institute,
conduct or defend by litigation hereunder or in relation hereto at the
request, order or direction of the Certificate Insurer or any of the
Certificateholders, pursuant to the provisions of this Agreement, unless
such Certificateholders or the Certificate Insurer, as applicable, shall
have offered to the Trustee reasonable security or indemnity against the
costs, expenses and liabilities which may be incurred therein or thereby;
nothing contained herein shall, however, relieve the Trustee of the
obligation, upon the occurrence of a Servicer Default (which has not been
cured), to exercise such of the rights and powers vested in it by this
Agreement, and to use the same degree of care and skill in its exercise as
a prudent person would exercise or use under the circumstances in the
conduct of such person's own affairs;
(iv) The Trustee shall not be personally liable for any action
taken, suffered or omitted by it in good faith and believed by it to be
authorized or within the discretion or rights or powers conferred upon it
by this Agreement;
(v)Prior to the occurrence of a Servicer Default hereunder and
after the curing of all Defaults which may have occurred, the Trustee
shall not be bound to make any investigation into the facts or matters
stated in any resolution, certificate, statement, instrument, opinion,
report, notice, request, consent, order, approval, bond or other paper or
document, unless requested in writing to do so by the Certificate Insurer
or Holders of Class A Certificates evidencing not less than 25% of the sum
of the aggregate Class Balances of the Class A Certificates; PROVIDED,
HOWEVER, that if the payment within a reasonable time to the Trustee of
the costs, expenses or liabilities likely to be incurred by it in the
making of such investigation is, in the opinion of the Trustee, not
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 taking any such
action. The reasonable expense of every such examination shall be paid by
the Servicer or, if paid by the Trustee, shall be repaid by the Servicer
upon demand from the Servicer's own funds;
(vi) 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;
(vii) The Trustee shall not be required to give any bond or
surety in respect of the execution of the Trust created hereby or the
powers granted hereunder; and
(viii) The Trustee may execute any of the trusts or powers
hereunder or perform any duties hereunder, including, without limitation,
under Section 2.06 hereof, either directly or by or through agents or
attorney.
(b) Following the Startup Day, the Trustee shall not knowingly
accept any contribution of assets, including substitutions, to the Trust Fund or
any Trust REMIC, unless the Trustee shall have received an Opinion of Counsel to
the effect that the inclusion of such assets in the Trust Fund or any Trust
REMIC will not cause such Trust REMIC to fail to qualify as a REMIC at any time
that any Certificates are outstanding or subject any Trust REMIC to any tax
under the REMIC Provisions or other applicable provisions of federal, state and
local law or ordinances.
Section 12.03 TRUSTEE NOT LIABLE FOR CERTIFICATES OR MORTGAGE
LOANS.
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 Depositors, and the Trustee assumes no responsibility for
their correctness. The Trustee makes no representations as to the validity or
sufficiency of this Agreement or of the Certificates or of any Mortgage Loan or
related document. The Trustee shall not be accountable for the use or
application by the Depositors of any of the Certificates or of the proceeds of
such Certificates, or for the use or application of any funds paid to the
Servicer in respect of the Mortgage Loans or deposited in or withdrawn from the
Principal and Interest Account by the Servicer. The Trustee shall not be
responsible for the legality or validity of the Agreement or the validity,
priority, perfection or sufficiency of the security for the Certificates issued
or intended to be issued hereunder.
Section 12.04 TRUSTEE MAY OWN CERTIFICATES.
The Trustee in its individual or any other capacity may become the
owner or pledgee of Certificates with the same rights it would have if it were
not Trustee, and may otherwise deal with the parties hereto.
Section 12.05 SERVICER TO PAY TRUSTEE'S FEES AND EXPENSES.
The Servicer covenants and agrees to pay to the Trustee from time to
time, and the Trustee shall be entitled to, reasonable compensation (which shall
not be limited by any provision of law in regard to the compensation of a
trustee of an express trust) for all services rendered by it in the execution of
the trusts hereby created and in the exercise and performance of any of the
powers and duties hereunder of the Trustee, including the powers and duties
described in SECTION 2.07 hereof, and the Servicer will pay or reimburse the
Trustee upon its request, and, if such amounts are not paid by the Servicer
within thirty (30) days of demand therefor, with interest thereon at the
Trustee's prime rate (which prime rate shall not exceed 10% per annum), for all
reasonable expenses, disbursements and advances incurred or made by the Trustee
in accordance with any of the provisions of this Agreement (including, without
limitation, the reasonable fees, expenses and disbursements of its counsel
(including, reasonable compensation of its in-house counsel on an hourly basis)
and of all persons not regularly in its employ, including any agents, attorneys
and accountants of the Trustee, as described in SECTION 2.07(A) hereof) and such
out-of-pocket expenses as may be incurred by the Trustee in assuming servicing
responsibilities under SECTION 10.02 hereof, such reimbursable amounts to
include expenses incurred due to the Servicer's failure to properly discharge
its responsibilities hereunder or to the representations and warranties as to
any Mortgage Loan or Loans being untrue, but not to include general overhead
incurred by the Trustee as a result of becoming successor Servicer (provided
however, prior to incurring such expenses, disbursements and advances ("COSTS"),
the Trustee will give the Servicer an opportunity to provide such services to
render such costs unnecessary), except any such expense, disbursement or advance
as may arise from its negligence or bad faith, provided that the Trustee shall
have no lien on the Trust Fund or any Trust REMIC for the payment of its fees
and expenses. Failure by the Servicer to pay any such fees or other expenses
shall not relieve the Trustee of its obligation hereunder. The Trustee and any
director, officer, employee or agent of the Trustee shall be indemnified by the
Servicer and held harmless against any loss, liability or expense (i) incurred
in connection with any legal action relating to this Agreement or the
Certificates, other than any loss, liability or expense incurred by reason of
willful misfeasance, bad faith or negligence in the performance of duties
hereunder or by reason of reckless disregard of obligations and duties
hereunder, and (ii) resulting from any error in any tax or information return
prepared by the Servicer. The obligations of the Servicer under this SECTION
12.05 shall survive termination of the Servicer and payment of the Certificates,
and shall extend to any co-trustee appointed pursuant to this ARTICLE XII. The
compensation due to the Trustee pursuant to this SECTION 12.05 shall be paid by
the Servicer from it own funds.
Section 12.06 ELIGIBILITY REQUIREMENTS FOR TRUSTEE.
The Trustee hereunder shall at all times be (i) a banking
association organized and doing business under the laws of any state or the
United State of America, (ii) authorized under such laws to exercise corporate
trust powers, including taking title to the Trust Fund asset on behalf of the
Certificateholders, (iii) having a combined capital and surplus of at least
$50,000,000, (iv) whose long-term deposits, if any, shall be rated at least
"BBB" by S&P or such lower long-term deposit rating by S&P as may be approved in
writing by the Certificate Insurer and S&P and with a long-term deposit rating
of at least "Baa2" from Moody's (or such lower rating which would not cause
Moody's to reduce its then current ratings of the Class A Certificates), (v) is
subject to supervision or examination by federal or state authority and (vi) is
reasonably acceptable to the Certificate Insurer as evidenced in writing. If
such banking 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 12.06 its combined capital and
surplus shall be deemed to be as set forth in it 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, the Trustee shall give notice of
such ineligibility to the Certificate Insurer and shall resign, upon the request
of the Certificate Insurer or the Majority in Aggregate Voting Interest, in the
manner and with the effect specified in SECTION 12.07.
Section 12.07 RESIGNATION AND REMOVAL OF THE TRUSTEE.
The Trustee may at any time resign and be discharged from the trusts
hereby created by giving written notice thereof to the Servicer, the Certificate
Insurer and to all Certificateholders. Upon receiving such notice of
resignation, the Servicer shall, with the consent of the Certificate Insurer,
promptly appoint a successor trustee by written instrument, in duplicate, which
Instrument shall be delivered to the resigning Trustee and to the successor
trustee. A copy of such instrument shall be delivered to the Certificateholders
by the Servicer. Unless a successor trustee shall have been appointed and have
accepted appointment within 60 days after the giving of such notice of
resignation, the resigning Trustee may petition any court of competent
jurisdiction for the appointment of a successor trustee.
If at any time the Trustee shall cease to be eligible in accordance
with the provisions of SECTION 12.06 and shall fail to resign after written
request therefor by the Servicer, the Certificate Insurer or the Majority in
Aggregate Voting Interest, 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 the Servicer may remove the
Trustee and shall, within 30 days after such removal, appoint, subject to the
approval of the Certificate Insurer, which approval shall not be unreasonably
withheld, a successor trustee by written instrument, in duplicate, which
instrument shall be delivered to the Trustee so removed and to the successor
trustee. A copy of such instrument shall be delivered to the Certificateholders
by the Servicer.
The Majority in Aggregate Voting Interest or, if the Trustee fails
to perform in accordance with this Agreement, the Certificate Insurer may 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, or by the Certificate Insurer, as the case may be, one complete
set of which instruments shall be delivered to the Servicer, 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 shall become
effective upon acceptance of appointment by the successor trustee as provided in
SECTION 12.08.
Section 12.08 SUCCESSOR TRUSTEE.
Any successor trustee appointed as provided in SECTION 12.07 shall
execute, acknowledge and deliver to the Servicer and to its predecessor trustee
an instrument accepting such appointment hereunder, and thereupon the
resignation or removal of the predecessor trustee shall become effective and
such successor trustee, without any further act, deed or conveyance, shall
become fully vested with all the rights, powers, duties and obligations of its
predecessor hereunder, with the like effect as if originally named as trustee
herein. The predecessor trustee shall deliver to the successor trustee all
Trustee's Mortgage Files and related documents and statement held by it
hereunder, and the Servicer and the predecessor trustee shall execute and
deliver such instruments and do such other things as may reasonably be required
for more fully and certainly vesting and confirming in the successor trustee all
such rights, powers duties and obligations.
No successor trustee shall accept appointment as provided in this
Section unless at the time of such acceptance such successor trustee shall be
eligible under the provisions of SECTION 12.06.
Upon acceptance of appointment by a successor trustee as provided in
this Section, the Servicer shall mail notice of the succession of such trustee
hereunder to all Holders of Certificates at their addresses shown in the
Certificate Register and S&P and Moody's. If the Servicer fails to mail such
notice within ten days after acceptance of appointment by the successor trustee,
the successor trustee shall cause such notice to be mailed at the expense of the
Servicer.
Section 12.09 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 corporation or national banking association
resulting from any merger, conversion or consolidation to which the Trustee
shall be a party, or any corporation or national banking association succeeding
to the business of the Trustee, shall be the successor of the Trustee hereunder,
provided such corporation or national banking association shall be eligible
under the provisions of SECTION 12.06, 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 12.10 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
Servicer and the Trustee acting jointly shall have the power and shall execute
and deliver all instruments to appoint one or more Persons approved by the
Trustee and the Certificate Insurer with written notice to the Rating Agencies
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 12.10,
such powers, duties, obligations, rights and trusts as the Servicer and the
Trustee may consider necessary or desirable. If the Servicer shall not have
joined in such appointment within 15 days after the receipt by it of a request
so to do, or in case a Servicer Default shall have occurred and be continuing,
the Trustee alone (with the consent of the Certificate Insurer with written
notice to the Rating Agencies shall have the power to make such appointment. No
co-trustee or separate trustee hereunder shall be required to meet the terms of
eligibility as a successor trustee under SECTION 12.06 hereunder and no notice
to Holders of Certificates of the appointment of co-trustee(s) or separate
trustee(s) shall be required under SECTION 12.08 hereof.
In the case of any appointment of a co-trustee or separate trustee
pursuant to this SECTION 12.10, all rights, powers, duties and obligations
conferred or imposed upon the Trustee shall be conferred or imposed upon and
exercised or performed by the Trustee and such separate trustee or co-trustee
jointly, except to the extent that under any law of any jurisdiction in which
any particular act or acts are to be performed (whether as Trustee hereunder or
as successor to the Servicer hereunder), the Trustee shall be incompetent or
unqualified to perform such act or acts, in which event such rights, powers,
duties and obligations (including the holding of title to the Trust Fund or any
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 XII. 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.
Any separate trustee or co-trustee may, at any time, constitute the
Trustee, its agent or attorney-in-fact, with full power and authority, to the
extent not prohibited by law, to do any lawful act under or in respect of this
Agreement on its behalf and in its name. If any separate trustee or co-trustee
shall die, become incapable of acting, resign or be removed, all of its estates,
properties, rights, remedies and trusts shall vest in and be exercised by the
Trustee, to the extent permitted by law, without the appointment of a new or
successor trustee.
Section 12.11 APPOINTMENT OF CUSTODIANS.
The Trustee may, with the consent of the Servicer and the
Certificate Insurer and notice to the Rating Agencies appoint one or more
Custodians to hold all or a portion of the Trustee's Mortgage Files as agent for
the Trustee, by entering into a Custodial Agreement. Bank One Trust Company, N.
A. is initially appointed Custodian with respect to all Mortgage Loans and, for
so long as it shall be the Custodian hereunder, agrees to comply with the terms
of the provisions of EXHIBIT N hereto applicable to the duties of the Custodian.
Subject to this ARTICLE XII, the Trustee agrees to comply with the terms of each
Custodial Agreement and to enforce the terms and provisions thereof against the
Custodian for the benefit of the Certificateholders and the Certificate Insurer.
The Servicer shall be liable for the fees of any Custodian appointed hereunder.
Each Custodian shall be a depository institution subject to supervision by
federal or state authority and shall be qualified to do business in the
jurisdiction in which it holds any Trustee's Mortgage File. Each Custodial
Agreement may be amended only as provided in SECTION 13.02.
Section 12.12 PROTECTION OF TRUST FUND.
(a) The Trustee will hold the Trust Fund in trust for the benefit of
the Holders and the Certificate Insurer and, upon request of the Certificate
Insurer, or, with the consent of the Certificate Insurer, at the request of the
Depositors, will from time to time execute and deliver all such supplements and
amendments hereto pursuant to SECTION 13.02 hereof and all instruments of
further assurance and other instruments, and will take such other action upon
such request to:
(i) more effectively hold in trust all or any portion of the
Trust Fund;
(ii) perfect, publish notice of, or protect the validity
of any grant made or to be made by this Agreement;
(iii) enforce any of the Mortgage Loans; or
(iv) preserve and defend title to the Trust Fund and the rights
of the Trustee, and the ownership Interests of the Holders represented
thereby, in such Trust Fund against the claims of all Persons and parties.
The Trustee shall send copies of any request received from the
Certificate Insurer or the Depositors to take any action pursuant to this
SECTION 12.12 to the others.
(b) Subject to ARTICLE X hereof, the Trustee shall have the power to
enforce, and shall enforce the obligations of the other parties to this
Agreement and of the Certificate Insurer, by action, suit or proceeding at law
or equity, and shall also have the power to enjoin, by action or suit in equity,
any acts or occurrences which may be unlawful or in violation of the rights of
the Holders; PROVIDED, HOWEVER, that nothing in this SECTION 12.12 shall require
any action by the Trustee unless the Trustee shall FIRST (i) have been furnished
indemnity satisfactory to it and SECOND (ii) when required by this Agreement,
have been requested to take such action by the Majority in Aggregate Voting
Interest, the Certificate Insurer or the Depositors in accordance with the terms
of this Agreement.
(c) The Trustee shall execute any instrument required pursuant to
this Section so long as such Instrument does not conflict with this Agreement or
with the Trustee's fiduciary duties.
ARTICLE XIII
MISCELLANEOUS PROVISIONS
Section 13.01 THE CERTIFICATE INSURER.
Any right conferred to the Certificate Insurer hereunder shall be
suspended during any period in which the Certificate Insurer is in default in
its payment obligations under the Certificate Insurance Policy, and its rights
during such period shall vest in the Majority in Aggregate Voting Interest. At
such time as the Certificates are no longer outstanding, and no amounts owed to
the Certificate Insurer hereunder remain unpaid and the Certificate Insurance
Policy has expired in accordance with its terms, the Certificate Insurer's
rights hereunder shall terminate.
Section 13.02 AMENDMENT.
(a) This Agreement may be amended from time to time by the
Depositors, the Trustee and the Servicer by written agreement, upon the prior
written consent of the Certificate Insurer, without notice to or consent of the
Certificateholders, to cure any ambiguity or mistake, to correct or supplement
any provisions herein, to comply with any changes in the Code, or to make any
other provisions with respect to matters or questions arising under this
Agreement which shall not be inconsistent with the provisions of this Agreement,
or any Custodial Agreement; PROVIDED, HOWEVER, that such action shall not
adversely affect the interests of any Certificateholder or the Certificate
Insurer, as evidenced by an Opinion of Counsel or written notification from each
Rating Agency to the effect that such amendment will not cause such Rating
Agency to lower or withdraw the then current ratings on the Certificates, at the
expense of the party requesting the change, delivered to the Certificate
Insurer, the Trustee and the Depositors; and PROVIDED, FURTHER, that no such
amendment shall reduce in any manner the amount of, or delay the timing of,
payments received on Mortgage Loans which are required to be distributed on any
Certificate without the consent of the Holder of such Certificate, or change the
rights or obligations of any other party hereto without the consent of such
party. The Trustee shall give prompt written notice to each Rating Agency of any
amendment made pursuant to this SECTION 13.02(A).
(b) This Agreement may be amended from time to time by the
Depositors, the Trustee and the Servicer, with the consent of the Certificate
Insurer, the Majority in Aggregate Voting Interest and the Holders of the
majority of the Percentage Interest in the Class R-I, Class R-II, Class R-III
and Class R-IV Certificates for the purpose of adding any provisions to or
changing in any manner or eliminating any of the provisions of this Agreement or
of modifying in any manner the rights of the Holders; PROVIDED, HOWEVER, that no
such amendment shall reduce in any manner the amount of, or delay the timing of,
any payments which are required to be distributed on any Class A Certificate
without the consent of the Holder of such Certificate or reduce the percentage
for each Class of Certificates the Holders of which are required to consent to
any such amendment without the consent of the Holders of 100% of each Class of
Certificates affected thereby. Prior notice of any proposed amendment pursuant
to this SECTION 13.02(B) shall be given to each Rating Agency.
(c) It shall not be necessary for the consent of Holders under this
Section to approve the particular form of any proposed amendment, but it shall
be sufficient if such consent shall approve the substance thereof.
(d) 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 or
the exercise of any power granted to the Servicer, the Representative, any
Depositor, the Certificate Insurer or the Trustee in accordance with such
amendment will not result in the imposition of a tax on any Trust REMIC, will
not cause any Trust REMIC to fail to qualify as a REMIC or will not cause the
portion of the Trust Fund exclusive of any Trust REMIC to fail to qualify as a
grantor trust at any time that any Certificate is outstanding. No amendment
shall have the effect of varying the latest possible maturity, principal amount
or interest rate of the Trust unless the Trustee shall have received an Opinion
of Counsel that the amendment will not cause the regular interest to lack fixed
terms within the meaning of the REMIC provisions.
(e) An amendment or supplement to the original issue discount legend
shall not be an amendment or supplement for purposes of this Article 13.
Section 13.03 RECORDATION OF AGREEMENT.
To the extent permitted by applicable law, this Agreement, or a
memorandum thereof if permitted under applicable law, is subject to recordation
in all appropriate public offices for real property records in all of the
counties or other comparable jurisdictions in which any or all of the properties
subject to the Mortgages are situated, and in any other appropriate public
recording office or elsewhere, such recordation to be effected by the Servicer
at the Holders' or Certificate Insurer's expense on direction and at the expense
of the Majority in Aggregate Voting Interest or the Certificate Insurer
requesting such recordation, but only when accompanied by an Opinion of Counsel
to the effect that such recordation materially and beneficially affects the
interests of the Certificateholders or the Certificate Insurer or is necessary
for the administration or servicing of the Mortgage Loans.
Section 13.04 DURATION OF AGREEMENT.
This Agreement shall continue in existence and effect until
terminated as herein provided.
Section 13.05 GOVERNING LAW.
THIS AGREEMENT SHALL BE CONSTRUED IN ACCORDANCE WITH THE LAWS OF THE
STATE OF NEW YORK, AND THE OBLIGATIONS, RIGHTS AND REMEDIES OF THE PARTIES
HEREUNDER SHALL BE DETERMINED IN ACCORDANCE WITH SUCH LAWS, WITHOUT GIVING
EFFECT TO PRINCIPLES OF CONFLICTS OF LAW (BUT WITH REFERENCE TO SECTION 5-1401
OF THE NEW YORK GENERAL OBLIGATIONS LAW, WHICH BY ITS TERMS APPLIES TO THIS
AGREEMENT).
Section 13.06 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 overnight mail, certified mail or registered mail, postage prepaid,
to (i) in the case of the Servicer and the Representative, EquiCredit
Corporation of America, 10401 Deerwood Park Boulevard, Jacksonville, Florida
32256-0505 Attention: General Counsel, or such other addresses as may hereafter
be furnished to the Trustee in writing by the Representative and the Servicer,
(ii) in the case of each Depositor, c/o EquiCredit Corporation of America, 10401
Deerwood Park Boulevard, Jacksonville, Florida 32256-0505 Attention: General
Counsel, or such other addresses as may hereafter be furnished to the Trustee in
writing by such Depositor, (iii) in the case of the Certificateholders, as set
forth in the Certificate Register, (iv) in the case of the Trustee, U.S. Bank
National Association, 111 East Wacker Drive, Suite 3000, Chicago, Illinois
60601, Attention: Corporate Trust Department, (v) in the case of Moody's, 99
Church Street, New York, New York 10007, Attention: Home Equity Monitoring
Group, (vi) in the case of S&P, 55 Water Street, New York, New York 10041,
Attention: Ms. Nancy Gigante and (vii) in the case of the Certificate Insurer,
Ambac Assurance Corporation, One State Street Plaza, New York, New York 10004,
Attention: Structured Financed MBS (re: EQCC Home Equity Loan Trust 1999-3). Any
such notices shall be deemed to be effective with respect to any party hereto
upon the receipt of such notice by such party, except that notices to the
Certificateholders shall be effective upon mailing or personal delivery.
Section 13.07 SEVERABILITY OF PROVISIONS.
If any one or more of the covenants, agreements, provisions or terms
of this Agreement shall be held invalid for any reason whatsoever, 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 covenants,
agreements, provisions or terms of this Agreement.
Section 13.08 NO PARTNERSHIP.
Except for federal, state and local income, franchise or similar tax
purposes, nothing herein contained shall be deemed or construed to create a
co-partnership or joint venture between the parties hereto and the services of
the Servicer shall be rendered as an independent contractor and not as agent for
the Certificateholders.
Section 13.09 COUNTERPARTS.
This Agreement may be executed in one or more counterparts and by
the different parties hereto on separate counterparts, each of which, when so
executed, shall be deemed to be an original; such counterparts, together, shall
constitute one and the same agreement.
Section 13.10 SUCCESSORS AND ASSIGNS.
This Agreement shall inure to the benefit of and be binding upon the
Representative, the Servicer, the Depositors, the Trustee and the
Certificateholders and their respective successors and assigns.
Section 13.11 HEADINGS.
The headings of the various Sections of this Agreement have been
inserted for convenience of reference only and shall not be deemed to be part of
this Agreement.
Section 13.12 LIMITATION OF LIABILITY OF TRUSTEE.
Notwithstanding anything contained herein to the contrary, this
Agreement has been executed by U.S. Bank National Association not in its
individual capacity but solely as Trustee and in no event shall U.S. Bank
National Association have any liability for the representations, warranties,
covenants, agreements or other obligations of the Depositors hereunder or in any
of the certificates, notices or agreements delivered pursuant hereto, as to all
of which recourse shall be had solely to the assets of the Trust Fund.
Section 13.13 LIMITATIONS ON RIGHTS OF OTHERS.
The provisions of this Agreement are solely for the benefit of the
Depositors, the Servicer, the Trustee, the Certificateholders and the
Originators and nothing in this Agreement whether express or implied, shall be
construed to give to any other Person any legal or equitable right, remedy or
claim in the assets of the Trust or under or in respect of this Agreement or any
covenants, conditions or provisions contained herein. The Certificate Insurer is
an intended third party beneficiary of this Agreement.
Section 13.14 NO PETITION.
The Servicer and the Trustee by entering into this Agreement hereby
covenants and agrees that it shall not, prior to the date which is one year and
one day after the termination of this Agreement pursuant to Article XI hereof,
acquiesce, petition or otherwise invoke or cause the Depositors to invoke the
process of any court or government authority for the purpose of commencing or
sustaining a case against the Depositors under any federal or state bankruptcy,
insolvency or similar law or appointing a receiver, liquidator, assignee,
trustee, custodian, sequestrator or other similar official of each of the
Depositors or any substantial part of its respective property, or ordering the
winding up or liquidation of the affairs of each of the Depositors.
Section 13.15 THIRD PARTY BENEFICIARY.
This Agreement shall inure to the benefit of and be binding upon the
parties hereto and, in addition, shall inure to the benefit of
Certificateholders and, to the extent provided herein, the Certificate Insurer
and their respective successors and permitted assigns. Except as otherwise
provided in this Agreement, no other Person shall have any right or obligation
hereunder.
<PAGE>
IN WITNESS WHEREOF, the Servicer, the Trustee and the Depositors
have caused their names to be signed hereto by their respective officers
thereunto duly authorized as of the day and year first above written.
U.S. BANK NATIONAL ASSOCIATION,
as Trustee
By:_______________________________
Name:
Title:
EQUICREDIT CORPORATION OF AMERICA,
as Representative and Servicer
By:_______________________________
Name:
Title:
THE DEPOSITORS:
EQCC RECEIVABLES CORPORATION
By:_______________________________
Name:
Title:
EQCC ASSET BACKED CORPORATION
By:_______________________________
Name:
Title:
<PAGE>
STATE OF NEW YORK )
) ss.:
COUNTY OF NEW YORK )
On the 26th day of August, 1999 before me, a Notary Public in and
for the State of New York, personally appeared James Dodd, known to me to be the
Vice-President of EQCC Receivables Corporation, the corporation that executed
the within instrument and also known to me to be the person who executed it on
behalf of said corporation, and acknowledged to me that such corporation
executed the within instrument.
IN WITNESS WHEREOF, I have hereunto set my hand and affixed my
official seal the day and year in this certificate first above written.
_____________________________________________
Notary Public
<PAGE>
STATE OF NEW YORK )
) ss.:
COUNTY OF NEW YORK )
On the 26th day of August, 1999 before me, a Notary Public in and
for the State of New York, personally appeared James Dodd, known to me to be the
Vice-President of EQCC Asset Backed Corporation, the corporation that executed
the within instrument and also known to me to be the person who executed it on
behalf of said corporation, and acknowledged to me that such corporation
executed the within instrument.
IN WITNESS WHEREOF, I have hereunto set my hand and affixed my
official seal the day and year in this certificate first above written.
_____________________________________________
Notary Public
<PAGE>
STATE OF NEW YORK )
) ss.:
COUNTY OF NEW YORK )
On the 26th day of August, 1999 before me, a Notary Public in and
for the State of New York, personally appeared James Dodd, known to me to be the
Vice-President of EquiCredit Corporation of America, a corporation that executed
the within instrument and also known to me to be the person who executed it on
behalf of said corporation, and acknowledged to me that such corporation
executed the within instrument.
IN WITNESS WHEREOF, I have hereunto set my hand and affixed my
official seal the day and year in this certificate first above written.
_____________________________________________
Notary Public
<PAGE>
STATE OF NEW YORK )
) ss.:
COUNTY OF NEW YORK )
On the ____ day of August, 1999 before me, a Notary Public in and
for the State of New York, personally appeared ___________________________,
known to me to be ____________________ of U.S. Bank National Association, a
national banking association that executed the within instrument and also known
to me to be the person who executed it on behalf of said corporation, and
acknowledged to me that such corporation executed the within instrument.
IN WITNESS WHEREOF, I have hereunto set my hand and affixed my
official seal the day and year in this certificate first above written.
_____________________________________________
Notary Public
<PAGE>
EXHIBIT A
CONTENTS OF MORTGAGE FILE
With respect to each Mortgage Loan, the Mortgage File shall include
each of the following items (copies to the extent the originals have been
delivered to the Depositors pursuant to SECTION 2.04 of the Pooling and
Servicing Agreement), all of which shall be available for inspection by the
Trustee and the Custodian, to the extent required by applicable laws:
1. The original Mortgage Note, with any intervening endorsements,
endorsed*/ - "Pay to the order of U.S. Bank National
Association, as Trustee under the Pooling and Servicing
Agreement dated as of August 1, 1999, Series 1999-3, without
recourse" or in blank and signed, by facsimile or manual
signature, in the name of the Originator that transferred such
Mortgage Loan to the applicable Depositor pursuant to the
Transfer Agreement by a Responsible Officer, with all prior
and intervening endorsements showing a complete chain of
endorsement from the originator to such Originator, if the
Originator from whom the Depositor acquired such Mortgage Loan
was not the originator and, with respect to manufactured
housing units, the certificate of title, if any.
2. Either: (i) the original Mortgage, with evidence of recording
thereon (and, in the case of a Mortgaged Property held in an
Illinois Land Trust, signed by the trustee of such Illinois
Land Trust), (ii) a copy of the Mortgage certified as a true
copy by a Responsible Officer of the applicable Originator
that transferred such Mortgage Loan to the applicable
Depositor pursuant to the Transfer Agreement (provided,
however, that such Responsible Officer may complete one or
more blanket certificates attaching copies of one or more
Mortgages relating thereto) or by the closing attorney, or by
an officer of the title insurer or agent of the title insurer
which issued the related title insurance policy, or commitment
therefor, if the original has been transmitted for recording
until such time as the original is returned by the public
recording office or (iii) a copy of the Mortgage certified by
the public recording office in those instances where the
original recorded Mortgage has been lost.
3. Except for a Mortgaged Property held in an Illinois Land
Trust, the original Assignment of Mortgage from the Originator
that transferred such Mortgage Loan to the applicable
Depositor pursuant to the Transfer Agreement to*/ U.S. Bank
National Association, as Trustee under the Pooling and
Servicing Agreement dated as of August 1, 1999, or in blank
pursuant to the Transfer Agreement.
- -----------------
*/ Upon the occurrence of the Recordation Trigger, the Servicer shall promptly
cause each Assignment of Mortgage to be recorded in the applicable recording
office in the name of the Trustee.
4. The original policy of title insurance or a true copy thereof
or, if such policy has not yet been delivered by the insurer,
the commitment or binder to issue same.
5. All intervening assignments, if any, showing a complete chain
of assignment from the originator to the applicable
Originator, including any recorded warehousing assignments,
with evidence of recording thereon, certified by a Responsible
Officer of the applicable Originator as a true copy of the
original of such intervening assignments.
6. Originals of all assumption and modification agreements, if
any or a copy certified as a true copy by a Responsible
Officer of the applicable Originator.
7. Except for a Mortgaged Property held in an Illinois Land
Trust, either: (i) originals of all intervening assignments,
if any showing a complete chain of title from the originator
to the applicable Originator, including any recorded
warehousing assignments, with evidence of recording thereon,
or, (ii) if the original intervening assignments have not yet
been returned from the recording office, a copy of the
originals of such intervening assignments together with a
certificate of a Responsible Officer of the Originator or the
closing attorney or an officer of the title insurer which
issued the related title insurance policy, or commitment
therefor, or its duly authorized agent certifying that the
copy is a true copy of the original of such intervening
assignments or (iii) a copy of the intervening assignment
certified by the public recording office in those instances
where the original recorded intervening assignment has been
lost.
8. If the Mortgaged Property is held in an Illinois Land Trust,
the original Assignment of Beneficial Interest, or, if the
trustee of such Illinois Land Trust retains such original
Assignment of Beneficial Interest, a certified true copy of
such Assignment of Beneficial Interest so certified by such
trustee.
9. If the Mortgaged Property is held in an Illinois Land Trust,
an original Reassignment of Assignment of Beneficial Interest
from the Originator to*/ U.S. Bank National Association, as
Trustee under the Pooling and Servicing Agreement dated as of
August 1, 1999, Series 1999-3 or in blank. In the event that
the Mortgage Loan was acquired by the applicable Originator in
a merger, the Reassignment of the Assignment of Beneficial
Interest must be by "[Originator], successor by merger to
"[name of predecessor]"; and in the event that the Mortgage
Loan was acquired or originated by such Originator while doing
business under another name, the Reassignment of Assignment of
Beneficial Interest must be by "[Originator], formerly known
as [previous name]."
10. If the Mortgaged Property is held in an Illinois Land Trust,
originals of all intervening Reassignments of Assignment of
Beneficial Interest, showing a complete chain of assignment
from the beneficiaries of such Illinois Land Trust to the
applicable Originator of all of such beneficiaries' right,
title, and interest in, to, and under the trust agreement with
respect to such Illinois Land Trust.
11. If the Mortgaged Property is held in an Illinois Land Trust,
(A) a certified copy of the instrument creating the Illinois
Land Trust, (B) a copy of the UCC-1 Financing Statement
evidencing the assignment of the Mortgagor's beneficial
interest in the Illinois Land Trust, with evidence of filing
thereon, and (C) the original personal guaranty of the
Mortgage Note, executed by each beneficiary of the Illinois
Land Trust.
12. Mortgage Loan closing statement and any other truth-in-lending
or real estate settlement procedure forms required by law.
13. Residential loan application.
14. Verification of employment and income, and tax returns, if
any.
15. Credit report on the mortgagor.
16. The full appraisal made in connection with the origination of
the related Mortgage Loan with photographs of the subject
property and of comparable properties, constituting evidence
sufficient to indicate that the Mortgaged Property relates to
a Residential Dwelling. Provided, that for certain loans with
combined loan-to-value ratios less than 85% and balances less
than $50,000, interior inspections may not be included.
17. Copy of the First Lien, if in the Servicer's file.
18. All other papers and records developed or originated by the
applicable Depositor or others, required to document the
Mortgage Loan or to service the Mortgage Loan.*/
- --------------------
*/ Upon the occurrence of the Recordation Trigger, the Servicer shall promptly
cause each Assignment of Mortgage to be recorded in the applicable recording
office in the name of the Trustee.
<PAGE>
EXHIBIT B-1
[FORM OF CLASS A-1F CERTIFICATE]
[Form of Face of Certificate]
[UNLESS THIS CERTIFICATE IS PRESENTED BY AN AUTHORIZED REPRESENTATIVE OF THE
DEPOSITORY TRUST COMPANY TO THE ISSUER 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 REQUESTED BY AN AUTHORIZED
REPRESENTATIVE OF THE DEPOSITORY TRUST COMPANY AND ANY PAYMENT IS MADE TO CEDE &
CO., ANY TRANSFER, PLEDGE OR OTHER USE HEREOF FOR VALUE OR OTHERWISE BY OR TO
ANY PERSON IS WRONGFUL SINCE THE REGISTERED OWNER HEREOF, CEDE & CO., HAS AN
INTEREST HEREIN.]
EQCC HOME EQUITY LOAN ASSET BACKED CERTIFICATES
Series 1999-3, Class A-1F Original Class A-1F Principal Balance:
No. A-1F-__ $_________________
Cut-off Date: August 1, 1999 Original Principal Balance as of the
Cut-off Date Represented by this
Certificate:
$_________________
First Distribution Date: Percentage Interest of this
September 27, 1999 Certificate:
_____%
Closing Date: Latest Maturity Date:
August 26, 1999 ______________________
CUSIP:___________ Common Code:_______________
ISIN:_____________
This certifies that _________________________ is the registered
owner of the percentage interest (the "PERCENTAGE INTEREST") evidenced by this
Certificate in distributions to the Holders of the Class A-1F Certificates with
respect to a group of fixed-rate residential mortgage loans ("FIXED RATE GROUP
1") which comprise part of a Trust Fund consisting primarily of two groups of
fixed-rate and one group of adjustable-rate residential mortgage loans (the
"MORTGAGE LOANS") master serviced by EquiCredit Corporation of America
(hereinafter called the "SERVICER", in its capacity as Servicer, and
"Representative", in its capacity as Representative, which terms include any
successor entity under the Agreement referred to below). Fixed Rate Group 1 was
originated or acquired by the Representative and certain of its wholly-owned
subsidiaries. Fixed Rate Group 1 will be serviced by the Servicer pursuant to
the terms and conditions of that certain Pooling and Servicing Agreement dated
as of August 1, 1999 (the "AGREEMENT") by and among the Representative, the
Servicer, EQCC Receivables Corporation, EQCC Asset Backed Corporation and U.S.
Bank National Association, as trustee (the "TRUSTEE"), certain of the pertinent
provisions of which are set forth herein. To the extent not defined herein, the
capitalized terms used herein have the meanings assigned in the Agreement. This
Certificate is issued under and is subject to the terms, provisions and
conditions of the Agreement, to which Agreement the holder of this Certificate
by virtue of the acceptance hereof assents and by which such holder is bound.
During each Accrual Period, interest will accrue on the Class A-1F
Certificates at a rate equal to the lesser of (i) 6.548% per annum and (ii) the
Fixed Rate Group 1 Net Funds Cap Rate.
On each Distribution Date, commencing on September 27, 1999, the
Trustee shall distribute to the Person in whose name this Certificate is
registered on the last calendar day of the month preceding the month in which
such Distribution Date occurs (the "RECORD DATE"), an amount equal to the
product of the Percentage Interest evidenced by this Certificate and the amount
required to be distributed to Holders of the Class A-1F Certificates on such
Distribution Date pursuant to SECTION 6.05 of the Agreement.
Solely for U.S. federal income tax purposes, this Certificate
represents (i) a beneficial interest in a "regular interest" in a "real estate
mortgage investment conduit" as those terms are defined, respectively, in
Sections 860G and 860D of the Internal Revenue Code of 1986, as amended, and
(ii) the right to receive payments in respect of Fixed Rate Group 1 Interest
Carryovers.
<PAGE>
IN WITNESS WHEREOF, the Trustee on behalf of the Trust has caused
this Certificate to be duly executed as of the date set forth below.
EQCC HOME EQUITY LOAN TRUST 1999-3
By: U.S. Bank National Association,
as Trustee
By:___________________________________
Authorized Signatory
Dated:
CERTIFICATE OF AUTHENTICATION
This is one of the Class A Certificates referred to in the
within-mentioned Agreement.
By: U.S. Bank National Association,
as Trustee
By:___________________________________
Authorized Signatory
<PAGE>
EXHIBIT B-2
[FORM OF CLASS A-2F CERTIFICATE]
[Form of Face of Certificate]
[UNLESS THIS CERTIFICATE IS PRESENTED BY AN AUTHORIZED REPRESENTATIVE OF THE
DEPOSITORY TRUST COMPANY TO THE ISSUER 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 REQUESTED BY AN AUTHORIZED
REPRESENTATIVE OF THE DEPOSITORY TRUST COMPANY AND ANY PAYMENT IS MADE TO CEDE &
CO., ANY TRANSFER, PLEDGE OR OTHER USE HEREOF FOR VALUE OR OTHERWISE BY OR TO
ANY PERSON IS WRONGFUL SINCE THE REGISTERED OWNER HEREOF, CEDE & CO., HAS AN
INTEREST HEREIN.]
EQCC HOME EQUITY LOAN ASSET BACKED CERTIFICATES
Series 1999-3, Class A-2F Original Class A-2F Principal Balance:
No. A-2F-__ $_________________
Cut-off Date: August 1, 1999 Original Principal Balance as of the
Cut-off Date Represented by this
Certificate:
$_________________
First Distribution Date: Percentage Interest of this
September 27, 1999 Certificate:
_____%
Closing Date: Latest Maturity Date:
August 26, 1999 ____________________
CUSIP:___________ Common Code:_______________
ISIN:_____________
This certifies that _________________________ is the registered
owner of the percentage interest (the "PERCENTAGE INTEREST") evidenced by this
Certificate in distributions to the Holders of the Class A-2F Certificates with
respect to a group of fixed-rate residential mortgage loans ("FIXED RATE GROUP
1") which comprise part of a Trust Fund consisting primarily of two groups of
fixed-rate and one group of adjustable-rate residential mortgage loans (the
"MORTGAGE LOANS") master serviced by EquiCredit Corporation of America
(hereinafter called the "SERVICER", in its capacity as Servicer, and
"Representative", in its capacity as Representative, which terms include any
successor entity under the Agreement referred to below). Fixed Rate Group 1 was
originated or acquired by the Representative and certain of its wholly-owned
subsidiaries. Fixed Rate Group 1 will be serviced by the Servicer pursuant to
the terms and conditions of that certain Pooling and Servicing Agreement dated
as of August 1, 1999 (the "AGREEMENT") by and among the Representative, the
Servicer, EQCC Receivables Corporation, EQCC Asset Backed Corporation and U.S.
Bank National Association, as trustee (the "TRUSTEE"), certain of the pertinent
provisions of which are set forth herein. To the extent not defined herein, the
capitalized terms used herein have the meanings assigned in the Agreement. This
Certificate is issued under and is subject to the terms, provisions and
conditions of the Agreement, to which Agreement the holder of this Certificate
by virtue of the acceptance hereof assents and by which such holder is bound.
During each Accrual Period, interest will accrue on the Class A-2F
Certificates at a rate equal to the lesser of (i) 6.887% per annum and (ii) the
Fixed Rate Group 1 Net Funds Cap Rate.
On each Distribution Date, commencing on September 27, 1999, the
Trustee shall distribute to the Person in whose name this Certificate is
registered on the last calendar day of the month preceding the month in which
such Distribution Date occurs (the "RECORD DATE"), an amount equal to the
product of the Percentage Interest evidenced by this Certificate and the amount
required to be distributed to Holders of the Class A-2F Certificates on such
Distribution Date pursuant to SECTION 6.05 of the Agreement.
Solely for U.S. federal income tax purposes, this Certificate
represents (i) a beneficial interest in a "regular interest" in a "real estate
mortgage investment conduit" as those terms are defined, respectively, in
Sections 860G and 860D of the Internal Revenue Code of 1986, as amended, and
(ii) the right to receive payments in respect of Fixed Rate Group 1 Interest
Carryovers.
<PAGE>
IN WITNESS WHEREOF, the Trustee on behalf of the Trust has caused
this Certificate to be duly executed as of the date set forth below.
EQCC HOME EQUITY LOAN TRUST 1999-3
By: U.S. Bank National Association,
as Trustee
By:___________________________________
Authorized Signatory
Dated:
CERTIFICATE OF AUTHENTICATION
This is one of the Class A Certificates referred to in the
within-mentioned Agreement.
By: U.S. Bank National Association,
as Trustee
By:___________________________________
Authorized Signatory
<PAGE>
EXHIBIT B-3
[FORM OF CLASS A-3F CERTIFICATE]
[Form of Face of Certificate]
[UNLESS THIS CERTIFICATE IS PRESENTED BY AN AUTHORIZED REPRESENTATIVE OF THE
DEPOSITORY TRUST COMPANY TO THE ISSUER 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 REQUESTED BY AN AUTHORIZED
REPRESENTATIVE OF THE DEPOSITORY TRUST COMPANY AND ANY PAYMENT IS MADE TO CEDE &
CO., ANY TRANSFER, PLEDGE OR OTHER USE HEREOF FOR VALUE OR OTHERWISE BY OR TO
ANY PERSON IS WRONGFUL SINCE THE REGISTERED OWNER HEREOF, CEDE & CO., HAS AN
INTEREST HEREIN.]
EQCC HOME EQUITY LOAN ASSET BACKED CERTIFICATES
Series 1999-3, Class A-3F Original Class A-3F Principal Balance:
No. A-3F-__ $_________________
Cut-off Date: August 1, 1999 Original Principal Balance as of the
Cut-off Date Represented by this
Certificate:
$_________________
First Distribution Date: Percentage Interest of this
September 27, 1999 Certificate:
_____%
Closing Date: Latest Maturity Date:
August 26, 1999 ____________________
CUSIP:___________ Common Code:_______________
ISIN:_____________
This certifies that _________________________ is the registered
owner of the percentage interest (the "PERCENTAGE INTEREST") evidenced by this
Certificate in distributions to the Holders of the Class A-3F Certificates with
respect to a group of fixed-rate residential mortgage loans ("FIXED RATE GROUP
1") which comprise part of a Trust Fund consisting primarily of two groups of
fixed-rate and one group of adjustable-rate residential mortgage loans (the
"MORTGAGE LOANS") master serviced by EquiCredit Corporation of America
(hereinafter called the "SERVICER", in its capacity as Servicer, and
"Representative", in its capacity as Representative, which terms include any
successor entity under the Agreement referred to below). Fixed Rate Group 1 was
originated or acquired by the Representative and certain of its wholly-owned
subsidiaries. Fixed Rate Group 1 will be serviced by the Servicer pursuant to
the terms and conditions of that certain Pooling and Servicing Agreement dated
as of August 1, 1999 (the "AGREEMENT") by and among the Representative, the
Servicer, EQCC Receivables Corporation, EQCC Asset Backed Corporation and U.S.
Bank National Association, as trustee (the "TRUSTEE"), certain of the pertinent
provisions of which are set forth herein. To the extent not defined herein, the
capitalized terms used herein have the meanings assigned in the Agreement. This
Certificate is issued under and is subject to the terms, provisions and
conditions of the Agreement, to which Agreement the holder of this Certificate
by virtue of the acceptance hereof assents and by which such holder is bound.
During each Accrual Period, interest will accrue on the Class A-3F
Certificates at a rate equal to the lesser of (i) 7.067% per annum and (ii) the
Fixed Rate Group 1 Net Funds Cap Rate.
On each Distribution Date, commencing on September 27, 1999, the
Trustee shall distribute to the Person in whose name this Certificate is
registered on the last calendar day of the month preceding the month in which
such Distribution Date occurs (the "RECORD DATE"), an amount equal to the
product of the Percentage Interest evidenced by this Certificate and the amount
required to be distributed to Holders of the Class A-3F Certificates on such
Distribution Date pursuant to SECTION 6.05 of the Agreement.
Solely for U.S. federal income tax purposes, this Certificate
represents (i) a beneficial interest in a "regular interest" in a "real estate
mortgage investment conduit" as those terms are defined, respectively, in
Sections 860G and 860D of the Internal Revenue Code of 1986, as amended, and
(ii) the right to receive payments in respect of Fixed Rate Group 1 Interest
Carryovers.
<PAGE>
IN WITNESS WHEREOF, the Trustee on behalf of the Trust has caused
this Certificate to be duly executed as of the date set forth below.
EQCC HOME EQUITY LOAN TRUST 1999-3
By: U.S. Bank National Association,
as Trustee
By:___________________________________
Authorized Signatory
Dated:
CERTIFICATE OF AUTHENTICATION
This is one of the Class A Certificates referred to in the
within-mentioned Agreement.
By: U.S. Bank National Association,
as Trustee
By:___________________________________
Authorized Signatory
<PAGE>
EXHIBIT B-4
[FORM OF CLASS A-4F CERTIFICATE]
[Form of Face of Certificate]
[UNLESS THIS CERTIFICATE IS PRESENTED BY AN AUTHORIZED REPRESENTATIVE OF THE
DEPOSITORY TRUST COMPANY TO THE ISSUER 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 REQUESTED BY AN AUTHORIZED
REPRESENTATIVE OF THE DEPOSITORY TRUST COMPANY AND ANY PAYMENT IS MADE TO CEDE &
CO., ANY TRANSFER, PLEDGE OR OTHER USE HEREOF FOR VALUE OR OTHERWISE BY OR TO
ANY PERSON IS WRONGFUL SINCE THE REGISTERED OWNER HEREOF, CEDE & CO., HAS AN
INTEREST HEREIN.]
EQCC HOME EQUITY LOAN ASSET BACKED CERTIFICATES
Series 1999-3, Class A-4F Original Class A-4F Principal Balance:
No. A-4F-__ $_________________
Cut-off Date: August 1, 1999 Original Principal Balance as of the
Cut-off Date Represented by this
Certificate:
$_________________
First Distribution Date: Percentage Interest of this
September 27, 1999 Certificate:
_____%
Closing Date: Latest Maturity Date:
August 26, 1999 ____________________
CUSIP:___________ Common Code:_______________
ISIN:_____________
This certifies that _________________________ is the registered
owner of the percentage interest (the "PERCENTAGE INTEREST") evidenced by this
Certificate in distributions to the Holders of the Class A-4F Certificates with
respect to a group of fixed-rate residential mortgage loans ("FIXED RATE GROUP
1") which comprise part of a Trust Fund consisting primarily of two groups of
fixed-rate and one group of adjustable-rate residential mortgage loans (the
"MORTGAGE LOANS") master serviced by EquiCredit Corporation of America
(hereinafter called the "SERVICER", in its capacity as Servicer, and
"Representative", in its capacity as Representative, which terms include any
successor entity under the Agreement referred to below). Fixed Rate Group 1 was
originated or acquired by the Representative and certain of its wholly-owned
subsidiaries. Fixed Rate Group 1 will be serviced by the Servicer pursuant to
the terms and conditions of that certain Pooling and Servicing Agreement dated
as of August 1, 1999 (the "AGREEMENT") by and among the Representative, the
Servicer, EQCC Receivables Corporation, EQCC Asset Backed Corporation and U.S.
Bank National Association, as trustee (the "TRUSTEE"), certain of the pertinent
provisions of which are set forth herein. To the extent not defined herein, the
capitalized terms used herein have the meanings assigned in the Agreement. This
Certificate is issued under and is subject to the terms, provisions and
conditions of the Agreement, to which Agreement the holder of this Certificate
by virtue of the acceptance hereof assents and by which such holder is bound.
During each Accrual Period, interest will accrue on the Class A-4F
Certificates at a rate equal to the lesser of (i) 7.371% per annum and (ii) the
Fixed Rate Group 1 Net Funds Cap Rate.
On each Distribution Date, commencing on September 27, 1999, the
Trustee shall distribute to the Person in whose name this Certificate is
registered on the last calendar day of the month preceding the month in which
such Distribution Date occurs (the "RECORD DATE"), an amount equal to the
product of the Percentage Interest evidenced by this Certificate and the amount
required to be distributed to Holders of the Class A-4F Certificates on such
Distribution Date pursuant to SECTION 6.05 of the Agreement.
Solely for U.S. federal income tax purposes, this Certificate
represents (i) a beneficial interest in a "regular interest" in a "real estate
mortgage investment conduit" as those terms are defined, respectively, in
Sections 860G and 860D of the Internal Revenue Code of 1986, as amended, and
(ii) the right to receive payments in respect of Fixed Rate Group 1 Interest
Carryovers.
<PAGE>
IN WITNESS WHEREOF, the Trustee on behalf of the Trust has caused
this Certificate to be duly executed as of the date set forth below.
EQCC HOME EQUITY LOAN TRUST 1999-3
By: U.S. Bank National Association,
as Trustee
By:___________________________________
Authorized Signatory
Dated:
CERTIFICATE OF AUTHENTICATION
This is one of the Class A Certificates referred to in the
within-mentioned Agreement.
By: U.S. Bank National Association,
as Trustee
By:___________________________________
Authorized Signatory
<PAGE>
EXHIBIT B-5
[FORM OF CLASS A-5F CERTIFICATE]
[Form of Face of Certificate]
[UNLESS THIS CERTIFICATE IS PRESENTED BY AN AUTHORIZED REPRESENTATIVE OF THE
DEPOSITORY TRUST COMPANY TO THE ISSUER 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 REQUESTED BY AN AUTHORIZED
REPRESENTATIVE OF THE DEPOSITORY TRUST COMPANY AND ANY PAYMENT IS MADE TO CEDE &
CO., ANY TRANSFER, PLEDGE OR OTHER USE HEREOF FOR VALUE OR OTHERWISE BY OR TO
ANY PERSON IS WRONGFUL SINCE THE REGISTERED OWNER HEREOF, CEDE & CO., HAS AN
INTEREST HEREIN.]
EQCC HOME EQUITY LOAN ASSET BACKED CERTIFICATES
Series 1999-3, Class A-5F Original Class A-5F Principal Balance:
No. A-5F-__ $_________________
Cut-off Date: August 1, 1999 Original Principal Balance as of the
Cut-off Date Represented by this
Certificate:
$_________________
First Distribution Date: Percentage Interest of this
September 27, 1999 Certificate:
_____%
Closing Date: Latest Maturity Date:
August 26, 1999 ____________________
CUSIP:___________ Common Code:_______________
ISIN:_____________
This certifies that _________________________ is the registered
owner of the percentage interest (the "PERCENTAGE INTEREST") evidenced by this
Certificate in distributions to the Holders of the Class A-5F Certificates with
respect to a group of fixed-rate residential mortgage loans ("FIXED RATE GROUP
1") which comprise part of a Trust Fund consisting primarily of two groups of
fixed-rate and one group of adjustable-rate residential mortgage loans (the
"MORTGAGE LOANS") master serviced by EquiCredit Corporation of America
(hereinafter called the "SERVICER", in its capacity as Servicer, and
"Representative", in its capacity as Representative, which terms include any
successor entity under the Agreement referred to below). Fixed Rate Group 1 was
originated or acquired by the Representative and certain of its wholly-owned
subsidiaries. Fixed Rate Group 1 will be serviced by the Servicer pursuant to
the terms and conditions of that certain Pooling and Servicing Agreement dated
as of August 1, 1999 (the "AGREEMENT") by and among the Representative, the
Servicer, EQCC Receivables Corporation, EQCC Asset Backed Corporation and U.S.
Bank National Association, as trustee (the "TRUSTEE"), certain of the pertinent
provisions of which are set forth herein. To the extent not defined herein, the
capitalized terms used herein have the meanings assigned in the Agreement. This
Certificate is issued under and is subject to the terms, provisions and
conditions of the Agreement, to which Agreement the holder of this Certificate
by virtue of the acceptance hereof assents and by which such holder is bound.
During each Accrual Period, interest will accrue on the Class A-5F
Certificates at a rate equal to the lesser of (i)(a) 7.638% per annum for each
Distribution Date on or prior to the Optional Purchase Date or (b) 8.138% per
annum for each Distribution Date following the Optional Purchase Date and (ii)
the Fixed Rate Group 1 Net Funds Cap Rate.
On each Distribution Date, commencing on September 27, 1999, the
Trustee shall distribute to the Person in whose name this Certificate is
registered on the last calendar day of the month preceding the month in which
such Distribution Date occurs (the "RECORD DATE"), an amount equal to the
product of the Percentage Interest evidenced by this Certificate and the amount
required to be distributed to Holders of the Class A-5F Certificates on such
Distribution Date pursuant to SECTION 6.05 of the Agreement.
Solely for U.S. federal income tax purposes, this Certificate
represents (i) a beneficial interest in a "regular interest" in a "real estate
mortgage investment conduit" as those terms are defined, respectively, in
Sections 860G and 860D of the Internal Revenue Code of 1986, as amended, and
(ii) the right to receive payments in respect of Fixed Rate Group 1 Interest
Carryovers.
<PAGE>
IN WITNESS WHEREOF, the Trustee on behalf of the Trust has caused
this Certificate to be duly executed as of the date set forth below.
EQCC HOME EQUITY LOAN TRUST 1999-3
By: U.S. Bank National Association,
as Trustee
By:___________________________________
Authorized Signatory
Dated:
CERTIFICATE OF AUTHENTICATION
This is one of the Class A Certificates referred to in the
within-mentioned Agreement.
By: U.S. Bank National Association,
as Trustee
By:___________________________________
Authorized Signatory
<PAGE>
EXHIBIT B-6
[FORM OF CLASS A-6F CERTIFICATE]
[Form of Face of Certificate]
[UNLESS THIS CERTIFICATE IS PRESENTED BY AN AUTHORIZED REPRESENTATIVE OF THE
DEPOSITORY TRUST COMPANY TO THE ISSUER 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 REQUESTED BY AN AUTHORIZED
REPRESENTATIVE OF THE DEPOSITORY TRUST COMPANY AND ANY PAYMENT IS MADE TO CEDE &
CO., ANY TRANSFER, PLEDGE OR OTHER USE HEREOF FOR VALUE OR OTHERWISE BY OR TO
ANY PERSON IS WRONGFUL SINCE THE REGISTERED OWNER HEREOF, CEDE & CO., HAS AN
INTEREST HEREIN.]
EQCC HOME EQUITY LOAN ASSET BACKED CERTIFICATES
Series 1999-3, Class A-6F Original Class A-6F Principal Balance:
No. A-6F-__ $_________________
Cut-off Date: August 1, 1999 Original Principal Balance as of the
Cut-off Date Represented by this
Certificate:
$_________________
First Distribution Date: Percentage Interest of this
September 27, 1999 Certificate:
_____%
Closing Date: Latest Maturity Date:
August 26, 1999 ____________________
CUSIP:___________ Common Code:_______________
ISIN:_____________
This certifies that _________________________ is the registered
owner of the percentage interest (the "PERCENTAGE INTEREST") evidenced by this
Certificate in distributions to the Holders of the Class A-6F Certificates with
respect to a group of fixed-rate residential mortgage loans ("FIXED RATE GROUP
1") which comprise part of a Trust Fund consisting primarily of two groups of
fixed-rate and one group of adjustable-rate residential mortgage loans (the
"MORTGAGE LOANS") master serviced by EquiCredit Corporation of America
(hereinafter called the "SERVICER", in its capacity as Servicer, and
"Representative", in its capacity as Representative, which terms include any
successor entity under the Agreement referred to below). Fixed Rate Group 1 was
originated or acquired by the Representative and certain of its wholly-owned
subsidiaries Fixed Rate Group 1 will be serviced by the Servicer pursuant to the
terms and conditions of that certain Pooling and Servicing Agreement dated as of
August 1, 1999 (the "AGREEMENT") by and among the Representative, the Servicer,
EQCC Receivables Corporation, EQCC Asset Backed Corporation and U.S. Bank
National Association, as trustee (the "TRUSTEE"), certain of the pertinent
provisions of which are set forth herein. To the extent not defined herein, the
capitalized terms used herein have the meanings assigned in the Agreement. This
Certificate is issued under and is subject to the terms, provisions and
conditions of the Agreement, to which Agreement the holder of this Certificate
by virtue of the acceptance hereof assents and by which such holder is bound.
During each Accrual Period, interest will accrue on the Class A-6F
Certificates at a rate equal to the lesser of (i) 7.267% per annum and (ii) the
Fixed Rate Group 1 Net Funds Cap Rate.
On each Distribution Date, commencing on September 27, 1999, the
Trustee shall distribute to the Person in whose name this Certificate is
registered on the last calendar day of the month preceding the month in which
such Distribution Date occurs (the "RECORD DATE"), an amount equal to the
product of the Percentage Interest evidenced by this Certificate and the amount
required to be distributed to Holders of the Class A-6F Certificates on such
Distribution Date pursuant to SECTION 6.05 of the Agreement.
Solely for U.S. federal income tax purposes, this Certificate
represents (i) a beneficial interest in a "regular interest" in a "real estate
mortgage investment conduit" as those terms are defined, respectively, in
Sections 860G and 860D of the Internal Revenue Code of 1986, as amended, and
(ii) the right to receive payments in respect of Fixed Rate Group 1 Interest
Carryovers.
<PAGE>
IN WITNESS WHEREOF, the Trustee on behalf of the Trust has caused
this Certificate to be duly executed as of the date set forth below.
EQCC HOME EQUITY LOAN TRUST 1999-3
By: U.S. Bank National Association,
as Trustee
By:___________________________________
Authorized Signatory
Dated:
CERTIFICATE OF AUTHENTICATION
This is one of the Class A Certificates referred to in the
within-mentioned Agreement.
By: U.S. Bank National Association,
as Trustee
By:___________________________________
Authorized Signatory
<PAGE>
EXHIBIT B-7
[FORM OF CLASS A-7F CERTIFICATE]
[Form of Face of Certificate]
[UNLESS THIS CERTIFICATE IS PRESENTED BY AN AUTHORIZED REPRESENTATIVE OF THE
DEPOSITORY TRUST COMPANY TO THE ISSUER 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 REQUESTED BY AN AUTHORIZED
REPRESENTATIVE OF THE DEPOSITORY TRUST COMPANY AND ANY PAYMENT IS MADE TO CEDE &
CO., ANY TRANSFER, PLEDGE OR OTHER USE HEREOF FOR VALUE OR OTHERWISE BY OR TO
ANY PERSON IS WRONGFUL SINCE THE REGISTERED OWNER HEREOF, CEDE & CO., HAS AN
INTEREST HEREIN.]
EQCC HOME EQUITY LOAN ASSET BACKED CERTIFICATES
Series 1999-3, Class A-7F Original Class A-7F Principal Balance:
No. A-7F-__ $_________________
Cut-off Date: August 1, 1999 Original Principal Balance as of the
Cut-off Date Represented by this
Certificate:
$_________________
First Distribution Date: Percentage Interest of this
September 27, 1999 Certificate:
_____%
Closing Date: Latest Maturity Date:
August 26, 1999 ____________________
CUSIP:___________ Common Code:_______________
ISIN:_____________
This certifies that _________________________ is the registered
owner of the percentage interest (the "PERCENTAGE INTEREST") evidenced by this
Certificate in distributions to the Holders of the Class A-7F Certificates with
respect to a group of fixed-rate residential mortgage loans ("FIXED RATE GROUP
2") which comprise part of a Trust Fund consisting primarily of two groups of
fixed-rate and one group of adjustable-rate residential mortgage loans (the
"MORTGAGE LOANS") master serviced by EquiCredit Corporation of America
(hereinafter called the "SERVICER", in its capacity as Servicer, and
"Representative", in its capacity as Representative, which terms include any
successor entity under the Agreement referred to below). Fixed Rate Group 2 was
originated or acquired by the Representative and certain of its wholly-owned
subsidiaries. Fixed Rate Group 2 will be serviced by the Servicer pursuant to
the terms and conditions of that certain Pooling and Servicing Agreement dated
as of August 1, 1999 (the "AGREEMENT") by and among the Representative, the
Servicer, EQCC Receivables Corporation, EQCC Asset Backed Corporation and U.S.
Bank National Association, as trustee (the "TRUSTEE"), certain of the pertinent
provisions of which are set forth herein. To the extent not defined herein, the
capitalized terms used herein have the meanings assigned in the Agreement. This
Certificate is issued under and is subject to the terms, provisions and
conditions of the Agreement, to which Agreement the holder of this Certificate
by virtue of the acceptance hereof assents and by which such holder is bound.
During each Accrual Period, interest will accrue on the Class A-7F
Certificates at a rate equal to the lesser of (i)(a) 7.448% per annum for each
Distribution Date on or prior to the Optional Purchase Date or (b) 7.948% per
annum for each Distribution Date following the Optional Purchase Date and (ii)
the Fixed Rate Group 2 Net Funds Cap Rate.
On each Distribution Date, commencing on September 27, 1999, the
Trustee shall distribute to the Person in whose name this Certificate is
registered on the last calendar day of the month preceding the month in which
such Distribution Date occurs (the "RECORD DATE"), an amount equal to the
product of the Percentage Interest evidenced by this Certificate and the amount
required to be distributed to Holders of the Class A-7F Certificates on such
Distribution Date pursuant to SECTION 6.05 of the Agreement.
Solely for U.S. federal income tax purposes, this Certificate
represents (i) a beneficial interest in a "regular interest" in a "real estate
mortgage investment conduit" as those terms are defined, respectively, in
Sections 860G and 860D of the Internal Revenue Code of 1986, as amended, and
(ii) the right to receive payments in respect of Fixed Rate Group 2 Interest
Carryovers.
<PAGE>
IN WITNESS WHEREOF, the Trustee on behalf of the Trust has caused
this Certificate to be duly executed as of the date set forth below.
EQCC HOME EQUITY LOAN TRUST 1999-3
By: U.S. Bank National Association,
as Trustee
By:___________________________________
Authorized Signatory
Dated:
CERTIFICATE OF AUTHENTICATION
This is one of the Class A Certificates referred to in the
within-mentioned Agreement.
By: U.S. Bank National Association,
as Trustee
By:___________________________________
Authorized Signatory
<PAGE>
EXHIBIT B-8
[FORM OF CLASS A-1A CERTIFICATE]
[Form of Face of Certificate]
[UNLESS THIS CERTIFICATE IS PRESENTED BY AN AUTHORIZED REPRESENTATIVE OF THE
DEPOSITORY TRUST COMPANY TO THE ISSUER 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 REQUESTED BY AN AUTHORIZED
REPRESENTATIVE OF THE DEPOSITORY TRUST COMPANY AND ANY PAYMENT IS MADE TO CEDE &
CO., ANY TRANSFER, PLEDGE OR OTHER USE HEREOF FOR VALUE OR OTHERWISE BY OR TO
ANY PERSON IS WRONGFUL SINCE THE REGISTERED OWNER HEREOF, CEDE & CO., HAS AN
INTEREST HEREIN.]
EQCC HOME EQUITY LOAN ASSET BACKED CERTIFICATES
Series 1999-3, Class A-1A Original Class A-1A Principal Balance:
No. A-1A-__ $_________________
Cut-off Date: August 1, 1999 Original Principal Balance as of the
Cut-off Date Represented by this
Certificate:
$_________________
First Distribution Date: Percentage Interest of this
September 27, 1999 Certificate:
_____%
Closing Date: Latest Maturity Date:
August 26, 1999 ____________________
CUSIP:___________ Common Code:_______________
ISIN:_____________
This certifies that _________________________ is the registered
owner of the percentage interest (the "PERCENTAGE INTEREST") evidenced by this
Certificate in distributions to the Holders of the Class A-1A Certificates with
respect to a group of adjustable-rate residential mortgage loans (the
"ADJUSTABLE RATE GROUP") which comprise part of a Trust Fund consisting
primarily of two groups of fixed-rate and one group of adjustable-rate mortgage
loans (the "MORTGAGE LOANS") master serviced by EquiCredit Corporation of
America (hereinafter called the "SERVICER", in its capacity as Servicer, and
"Representative", in its capacity as Representative, which terms include any
successor entity under the Agreement referred to below). The Adjustable Rate
Group was originated or acquired by the Representative and certain of its
wholly-owned subsidiaries. The Adjustable Rate Group will be serviced by the
Servicer pursuant to the terms and conditions of that certain Pooling and
Servicing Agreement dated as of August 1, 1999 (the "Agreement") by and among
the Representative, the Servicer, EQCC Receivables Corporation, EQCC Asset
Backed Corporation and U.S. Bank National Association, as trustee (the
"Trustee"), certain of the pertinent provisions of which are set forth herein.
To the extent not defined herein, the capitalized terms used herein have the
meanings assigned in the Agreement. This Certificate is issued under and is
subject to the terms, provisions and conditions of the Agreement, to which
Agreement the holder of this Certificate by virtue of the acceptance hereof
assents and by which such holder is bound.
During each Accrual Period, interest will accrue on the Class A-1A
Certificates at a rate equal to the lesser of (i) LIBOR as of the related LIBOR
Determination Date plus (a) 0.31% per annum on each Distribution Date on or
prior to the Optional Purchase Date and (b) 0.62% per annum on each Distribution
Date following the Optional Purchase Date and (ii) the Class A-1A Net Funds Cap
Rate.
On each Distribution Date, commencing on September 27, 1999, the
Trustee shall distribute to the Person in whose name this Certificate is
registered on the last calendar day of the month preceding the month in which
such Distribution Date occurs (the "RECORD DATE"), an amount equal to the
product of the Percentage Interest evidenced by this Certificate and the amount
required to be distributed to Holders of the Class A-1A Certificates on such
Distribution Date pursuant to SECTION 6.05 of the Agreement.
Solely for U.S. federal income tax purposes, this Certificate
represents (i) a beneficial interest in a "regular interest" in a "real estate
mortgage investment conduit" as those terms are defined, respectively, in
Sections 860G and 860D of the Internal Revenue Code of 1986, as amended, and
(ii) the right to receive payments in respect of Class A-1A LIBOR Interest
Carryovers.
<PAGE>
IN WITNESS WHEREOF, the Trustee on behalf of the Trust has caused
this Certificate to be duly executed as of the date set forth below.
EQCC HOME EQUITY LOAN TRUST 1999-3
By: U.S. Bank National Association,
as Trustee
By:___________________________________
Authorized Signatory
Dated:
CERTIFICATE OF AUTHENTICATION
This is one of the Class A Certificates referred to in the within-mentioned
Agreement.
By: U.S. Bank National Association,
as Trustee
By:___________________________________
Authorized Signatory
<PAGE>
EXHIBIT B-9
[FORM OF CLASS X CERTIFICATE]
THIS CERTIFICATE IS SUBORDINATED IN RIGHT OF PAYMENT TO THE CLASS A CERTIFICATES
AS DESCRIBED IN THE POOLING AND SERVICING AGREEMENT REFERRED TO HEREIN.
THIS CERTIFICATE HAS NOT BEEN REGISTERED OR QUALIFIED UNDER THE SECURITIES ACT
OF 1933, AS AMENDED (The "1933 ACT"), OR THE SECURITIES LAW OF ANY STATE. ANY
RESALE, TRANSFER OR OTHER DISPOSITION OF THIS CERTIFICATE WITHOUT SUCH
REGISTRATION OR QUALIFICATION MAY BE MADE ONLY IN A TRANSACTION WHICH DOES NOT
REQUIRE SUCH REGISTRATION OR QUALIFICATION AND IN ACCORDANCE WITH THE PROVISIONS
OF SECTION 4.02 OF THE POOLING AND SERVICING AGREEMENT REFERRED TO HEREIN.
NO TRANSFER OF THIS CERTIFICATE MAY BE MADE TO AN EMPLOYEE BENEFIT PLAN OR OTHER
RETIREMENT ARRANGEMENT, INCLUDING INDIVIDUAL RETIREMENT ACCOUNTS AND ANNUITIES,
KEOGH PLANS AND COLLECTIVE INVESTMENT FUNDS AND SEPARATE ACCOUNTS IN WHICH SUCH
PLANS, ACCOUNTS OR ARRANGEMENTS ARE INVESTED, THAT IS SUBJECT TO THE FIDUCIARY
RESPONSIBILITY PROVISIONS OF THE EMPLOYEE RETIREMENT INCOME SECURITY ACT OF
1974, AS AMENDED ("ERISA") OR SECTION 4975 OF THE CODE (OR COMPARABLE PROVISIONS
OF ANY SUBSEQUENT ENACTMENTS) (EACH, AN "ERISA PLAN"), UNLESS THE TRANSFEREE
PROVIDES THE SERVICER AND TRUSTEE WITH (1) A CERTIFICATION OF FACTS AND AN
OPINION OF COUNSEL SATISFACTORY TO THE SERVICER AND THE TRUSTEE THAT THE
PURCHASE OF THIS CERTIFICATE BY OR ON BEHALF OF SUCH ERISA PLAN IS PERMISSIBLE
UNDER APPLICABLE LAW, WILL NOT CONSTITUTE OR RESULT IN ANY NON-EXEMPT PROHIBITED
TRANSACTION UNDER SECTION 406 OF ERISA OR SECTION 4975 OF THE CODE AND WILL NOT
SUBJECT THE SERVICER OR THE TRUSTEE TO ANY OBLIGATION OR LIABILITY (INCLUDING
OBLIGATIONS OR LIABILITIES UNDER ERISA OR SECTION 4975 OF THE CODE) IN ADDITION
TO THOSE UNDERTAKEN IN THE AGREEMENT OR (2) IF SUCH TRANSFEREE IS AN INSURANCE
COMPANY, A CERTIFICATION OF FACTS WITH RESPECT TO CERTAIN MATTERS SET FORTH IN
THE AGREEMENT.
<PAGE>
EQCC HOME EQUITY LOAN ASSET BACKED CERTIFICATES
Series 1999-3, Class X Percentage Interest of this
No. X- Certificate:
_____%
Cut-off Date: August 1, 1999 Closing Date:
August 26, 1999
First Distribution Date:
September 27, 1999
This certifies that _________________________ is the registered
owner of the percentage interest (the "PERCENTAGE INTEREST") evidenced by this
Certificate in certain monthly distributions with respect to a Trust Fund
consisting primarily of two groups of fixed-rate and one group of
adjustable-rate mortgage loans (the "MORTGAGE LOANS") master serviced by
EquiCredit Corporation of America (hereinafter called the "SERVICER", in its
capacity as Servicer, and "REPRESENTATIVE", in its capacity as Representative,
which terms include any successor entity under the Agreement referred to below).
The Mortgage Loans were originated or acquired by the Representative and certain
of its wholly-owned subsidiaries. The Mortgage Loans will be serviced by the
Servicer pursuant to the terms and conditions of that certain Pooling and
Servicing Agreement dated as of August 1, 1999 (the "AGREEMENT") by and among
the Representative, the Servicer, EQCC Receivables Corporation, EQCC Asset
Backed Corporation and U.S. Bank National Association, as trustee (the
"TRUSTEE"), certain of the pertinent provisions of which are set forth herein.
To the extent not defined herein, the capitalized terms used herein have the
meanings assigned in the Agreement. This Certificate is issued under and is
subject to the terms, provisions and conditions of the Agreement, to which
Agreement the holder of this Certificate by virtue of the acceptance hereof
assents and by which such holder is bound.
On each Distribution Date, commencing on September 27, 1999, the
Trustee shall distribute to the Person in whose name this Certificate is
registered on the last calendar day of the month preceding the month in which
such Distribution Date occurs (the "RECORD DATE"), an amount equal to the
product of the Percentage Interest evidenced by this Certificate and any amount
required to be distributed to the Holders of the Class X Certificates on such
Remittance Date pursuant to SECTION 6.05 of the Agreement.
No transfer of any Class X Certificate shall be made unless that
transfer is made pursuant to an effective registration statement under the 1933
Act and effective registration or qualification under applicable state
securities laws, or is made in a transaction which does not require such
registration or qualification. In the event that a transfer is to be made
without such registration or qualification, (a) the Trustee shall require the
transferee to execute an investment letter, which investment letter shall not be
an expense of the Depositors, the Servicer or the Trustee and (b) in the event
that such a transfer is not made pursuant to Rule 144A under the Act, the
Depositors may direct the Trustee to require an Opinion of Counsel satisfactory
to the Trustee and the Depositors that such transfer may be made without such
registration or qualification, which Opinion of Counsel shall not be an expense
of the Depositors, the Trustee or the Servicer. Neither the Depositors nor the
Trustee is obligated to register or qualify any of the Class X Certificates
under the 1933 Act or any other securities law or to take any action not
otherwise required under the Agreement to permit the transfer of such
Certificates without registration or qualification. Any such Certificateholder
desiring to effect such transfer shall, and does hereby agree to, indemnify the
Trustee, the Depositors, the Certificate Insurer and the Servicer against any
liability that may result if the transfer is not so exempt or is not made in
accordance with such federal and state laws. In connection with any such
transfer, the Servicer and the Trustee will also require either (i) a
certification of facts and an Opinion of Counsel which establish to the
satisfaction of the Servicer and the Trustee that such transfer will not result
in a violation of Section 406 of ERISA or Section 4975 of the Code or cause the
Servicer or the Trustee to be deemed a fiduciary of an ERISA Plan or result in
the imposition of an excise tax under Section 4975 of the Code, or (ii) (a) a
representation letter, in the form as described in the Agreement, stating that
the transferee is not an ERISA Plan and is not acting on behalf of an ERISA Plan
or using the assets of an ERISA Plan to effect such purchase or (b) if such
transferee is an insurance company, a certification of facts with respect to
certain matters set forth in the Agreement.
Solely for U.S. federal income tax purposes, this Certificate
represents (i) a "regular interest" in a "real estate mortgage investment
conduit" as those terms are defined, respectively, in Sections 860G and 860D of
the Internal Revenue Code of 1986, as amended and (ii) the rights set forth
pursuant to SECTION 6.05 in the Agreement.
<PAGE>
IN WITNESS WHEREOF, the Trustee on behalf of the Trust has caused
this Certificate to be duly executed as of the date set forth below.
EQCC HOME EQUITY LOAN TRUST 1999-3
By: U.S. Bank National Association,
as Trustee
By:___________________________________
Authorized Signatory
Dated:
CERTIFICATE OF AUTHENTICATION
This is one of the Class X Certificates referred to in the within-mentioned
Agreement.
By: U.S. Bank National Association,
as Trustee
By:___________________________________
Authorized Signatory
<PAGE>
EXHIBIT B-10
[FORM OF CLASS R-I CERTIFICATE]
THIS CERTIFICATE IS SUBORDINATED IN RIGHT OF PAYMENT TO THE CLASS A AND CLASS X
CERTIFICATES AS DESCRIBED IN THE POOLING AND SERVICING AGREEMENT REFERRED TO
HEREIN.
THIS CERTIFICATE MAY NOT BE HELD BY OR TRANSFERRED TO A DISQUALIFIED NON-U.S.
PERSON OR A DISQUALIFIED ORGANIZATION OR AGENT THEREOF.
SOLELY FOR U.S. FEDERAL INCOME TAX PURPOSES, THIS CERTIFICATE IS A "RESIDUAL
INTEREST" IN A "REAL ESTATE MORTGAGE INVESTMENT CONDUIT" AS THOSE TERMS ARE
DEFINED, RESPECTIVELY, IN SECTIONS 860G AND 860D OF THE INTERNAL REVENUE CODE OF
1986 (THE "CODE").
THIS CERTIFICATE HAS NOT BEEN REGISTERED OR QUALIFIED UNDER THE SECURITIES ACT
OF 1933 (THE "1933 ACT") OR THE SECURITIES LAWS OF ANY STATE. ANY RESALE,
TRANSFER OR OTHER DISPOSITION OF THIS CERTIFICATE WITHOUT SUCH REGISTRATION OR
QUALIFICATION MAY BE MADE ONLY IN A TRANSACTION WHICH DOES NOT REQUIRE SUCH
REGISTRATION OR QUALIFICATION AND WHICH IS IN ACCORDANCE WITH THE PROVISIONS OF
SECTION 4.02 OF THE POOLING AND SERVICING AGREEMENT REFERRED TO HEREIN.
NO TRANSFER OF THIS CERTIFICATE MAY BE MADE TO AN EMPLOYEE BENEFIT PLAN OR OTHER
OR OTHER RETIREMENT ARRANGEMENT, INCLUDING INDIVIDUAL RETIREMENT ACCOUNTS AND
ANNUITIES, KEOGH PLANS AND COLLECTIVE INVESTMENT FUNDS AND SEPARATE ACCOUNTS IN
WHICH SUCH PLANS, ACCOUNTS OR ARRANGEMENTS ARE INVESTED, THAT IS SUBJECT TO THE
FIDUCIARY RESPONSIBILITY PROVISIONS OF THE EMPLOYEE RETIREMENT INCOME SECURITY
ACT OF 1974, AS AMENDED ("ERISA") OR SECTION 4975 OF THE CODE (OR COMPARABLE
PROVISIONS OF ANY SUBSEQUENT ENACTMENTS) (EACH, AN "ERISA PLAN").
ANY RESALE, TRANSFER OR OTHER DISPOSITION OF THIS CERTIFICATE MAY BE MADE ONLY
IF THE PROPOSED TRANSFEREE PROVIDES A TRANSFER AFFIDAVIT TO THE DEPOSITORS AND
THE TRUSTEE THAT (1) SUCH TRANSFEREE IS NOT A DISQUALIFIED ORGANIZATION OR AGENT
THEREOF, (2) NO PURPOSE OF SUCH TRANSFER IS TO IMPEDE THE ASSESSMENT OR
COLLECTION OF TAX AND (3) SUCH TRANSFEREE SATISFIES CERTAIN ADDITIONAL
CONDITIONS RELATING TO THE FINANCIAL CONDITION OF THE PROPOSED TRANSFEREE.
NOTWITHSTANDING THE REGISTRATION IN THE CERTIFICATE REGISTER OR ANY TRANSFER,
SALE OR OTHER DISPOSITION OF THIS CERTIFICATE TO A DISQUALIFIED ORGANIZATION OR
A DISQUALIFIED NON-UNITED STATES PERSON OR AN AGENT THEREOF, 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.
A TRANSFEROR OF THIS CERTIFICATE TO A DISQUALIFIED ORGANIZATION OR AN AGENT WHO
ACQUIRES THIS CERTIFICATE ON BEHALF OF A DISQUALIFIED ORGANIZATION MAY BE
SUBJECT TO A SIGNIFICANT FEDERAL INCOME TAX UNLESS IT PROPERLY RECEIVES THE
TRANSFER AFFIDAVIT AND AGREEMENT DESCRIBED IN SECTION 4.02(d) OF THE AGREEMENT.
THIS CERTIFICATE MAY BE A "NON-ECONOMIC RESIDUAL INTEREST," CERTAIN TRANSFERS OF
WHICH MAY BE DISREGARDED FOR FEDERAL INCOME TAX PURPOSES. EACH HOLDER OF THIS
CERTIFICATE BY ACCEPTANCE OF THIS CERTIFICATE SHALL BE DEEMED TO HAVE CONSENTED
TO THE PROVISIONS OF THIS PARAGRAPH.
<PAGE>
EQCC HOME EQUITY LOAN ASSET BACKED CERTIFICATES
Series 1999-3, Class R-I Percentage Interest of this
No. R-I-__ Certificate:
_____%
Cut-off Date: August 1, 1999 Closing Date:
August 26, 1999
First Distribution Date:
September 27, 1999
This certifies that _________________________ is the registered
owner of the interest (the "PERCENTAGE INTEREST") evidenced by this Certificate
in certain distributions with respect to a Trust Fund consisting primarily of
two groups of fixed-rate and one group of adjustable-rate mortgage loans (the
"MORTGAGE LOANS") master serviced by EquiCredit Corporation of America
(hereinafter called the "SERVICER", in its capacity as Servicer, and
"REPRESENTATIVE", in its capacity as Representative, which terms include any
successor entity under the Agreement referred to below). The Mortgage Loans were
originated or acquired by the Representative and certain of its wholly-owned
subsidiaries. The Mortgage Loans will be serviced by the Servicer pursuant to
the terms and conditions of that certain Pooling and Servicing Agreement dated
as of August 1, 1999 (the "AGREEMENT") by and among the Representative, the
Servicer, EQCC Receivables Corporation, EQCC Asset Backed Corporation and U.S.
Bank National Association, as trustee (the "TRUSTEE"), certain of the pertinent
provisions of which are set forth herein. To the extent not defined herein, the
capitalized terms used herein have the meanings assigned in the Agreement. This
Certificate is issued under and is subject to the terms, provisions and
conditions of the Agreement, to which Agreement the holder of this Certificate
by virtue of the acceptance hereof assents and by which such holder is bound.
On each Distribution Date, commencing on September 27, 1999, the
Trustee shall distribute to the Person in whose name this Certificate is
registered on the last calendar day of the month preceding the month in which
such Distribution Date occurs (the "RECORD DATE"), an amount equal to the
product of the Percentage Interest evidenced by this Certificate and any amount
required to be distributed to the Holders of the Class R-I Certificates on such
Remittance Date pursuant to SECTION 6.05 of the Agreement.
Each Holder of this Certificate will be deemed to have agreed to be
bound by the restrictions set forth in the Agreement to the effect that (i) each
person holding or acquiring any Ownership Interest in this Certificate must be a
Permitted Transferee, (ii) the transfer of any Ownership Interest in this
Certificate will be conditioned upon the delivery to the Trustee of, among other
things, an affidavit to the effect that it is a Permitted Transferee and (iii)
any attempted or purported transfer of any Ownership Interest in this
Certificate in violation of such restrictions will be absolutely null and void
and will vest no rights in the purported transferee. The Percentage Interest of
this Certificate is set forth above. Notwithstanding the fact that this
Certificate has no principal balance, this Certificate will remain outstanding
under the Agreement and the Holder hereof may have additional obligations as set
forth in the Agreement.
No transfer of any Class R-I Certificate shall be made unless that
transfer is made pursuant to an effective registration statement under the 1933
Act and effective registration or qualification under applicable state
securities laws, or is made in a transaction which does not require such
registration or qualification. In the event that a transfer is to be made
without such registration or qualification, (a) the Trustee shall require the
transferee to execute an investment letter, which investment letter shall not be
an expense of the Depositors, the Servicer or the Trustee and (b) in the event
that such a transfer is not made pursuant to Rule 144A under the Act, the
Depositors may direct the Trustee to require an Opinion of Counsel satisfactory
to the Trustee and the Depositors that such transfer may be made without such
registration or qualification, which Opinion of Counsel shall not be an expense
of the Depositors, the Trustee or the Servicer. Neither the Depositors nor the
Trustee is obligated to register or qualify any of the Class R-I Certificates
under the 1933 Act or any other securities law or to take any action not
otherwise required under the Agreement to permit the transfer of such
Certificates without registration or qualification. Any such Certificateholder
desiring to effect such transfer shall, and does hereby agree to, indemnify the
Trustee, the Depositors, the Certificate Insurer and the Servicer against any
liability that may result if the transfer is not so exempt or is not made in
accordance with such federal and state laws. In connection with any such
transfer, the Trustee will also require a representation letter, in the form as
described in the Agreement, stating that the transferee is not an ERISA Plan and
is not acting on behalf of an ERISA Plan or using the assets of an ERISA Plan to
effect such purchase.
<PAGE>
IN WITNESS WHEREOF, the Trustee on behalf of the Trust has caused
this Certificate to be duly executed as of the date set forth below.
EQCC HOME EQUITY LOAN TRUST 1999-3
By: U.S. Bank National Association,
as Trustee
By:___________________________________
Authorized Signatory
Dated:
CERTIFICATE OF AUTHENTICATION
This is one of the Class R-I Certificates referred to in the within-mentioned
Agreement.
By: U.S. Bank National Association,
as Trustee
By:___________________________________
Authorized Signatory
<PAGE>
EXHIBIT B-11
[FORM OF CLASS R-II CERTIFICATE]
THIS CERTIFICATE IS SUBORDINATED IN RIGHT OF PAYMENT TO THE CLASS A AND CLASS X
CERTIFICATES AS DESCRIBED IN THE POOLING AND SERVICING AGREEMENT REFERRED TO
HEREIN.
THIS CERTIFICATE MAY NOT BE HELD BY OR TRANSFERRED TO A DISQUALIFIED NON-U.S.
PERSON OR A DISQUALIFIED ORGANIZATION OR AGENT THEREOF.
SOLELY FOR U.S. FEDERAL INCOME TAX PURPOSES, THIS CERTIFICATE IS A "RESIDUAL
INTEREST" IN A "REAL ESTATE MORTGAGE INVESTMENT CONDUIT" AS THOSE TERMS ARE
DEFINED, RESPECTIVELY, IN SECTIONS 860G AND 860D OF THE INTERNAL REVENUE CODE OF
1986 (THE "CODE").
THIS CERTIFICATE HAS NOT BEEN REGISTERED OR QUALIFIED UNDER THE SECURITIES ACT
OF 1933 (THE "1933 ACT") OR THE SECURITIES LAWS OF ANY STATE. ANY RESALE,
TRANSFER OR OTHER DISPOSITION OF THIS CERTIFICATE WITHOUT SUCH REGISTRATION OR
QUALIFICATION MAY BE MADE ONLY IN A TRANSACTION WHICH DOES NOT REQUIRE SUCH
REGISTRATION OR QUALIFICATION AND WHICH IS IN ACCORDANCE WITH THE PROVISIONS OF
SECTION 4.02 OF THE POOLING AND SERVICING AGREEMENT REFERRED TO HEREIN.
NO TRANSFER OF THIS CERTIFICATE MAY BE MADE TO AN EMPLOYEE BENEFIT PLAN OR OTHER
OR OTHER RETIREMENT ARRANGEMENT, INCLUDING INDIVIDUAL RETIREMENT ACCOUNTS AND
ANNUITIES, KEOGH PLANS AND COLLECTIVE INVESTMENT FUNDS AND SEPARATE ACCOUNTS IN
WHICH SUCH PLANS, ACCOUNTS OR ARRANGEMENTS ARE INVESTED, THAT IS SUBJECT TO THE
FIDUCIARY RESPONSIBILITY PROVISIONS OF THE EMPLOYEE RETIREMENT INCOME SECURITY
ACT OF 1974, AS AMENDED ("ERISA") OR SECTION 4975 OF THE CODE (OR COMPARABLE
PROVISIONS OF ANY SUBSEQUENT ENACTMENTS) (EACH, AN "ERISA PLAN").
ANY RESALE, TRANSFER OR OTHER DISPOSITION OF THIS CERTIFICATE MAY BE MADE ONLY
IF THE PROPOSED TRANSFEREE PROVIDES A TRANSFER AFFIDAVIT TO THE DEPOSITORS AND
THE TRUSTEE THAT (1) SUCH TRANSFEREE IS NOT A DISQUALIFIED ORGANIZATION OR AGENT
THEREOF, (2) NO PURPOSE OF SUCH TRANSFER IS TO IMPEDE THE ASSESSMENT OR
COLLECTION OF TAX AND (3) SUCH TRANSFEREE SATISFIES CERTAIN ADDITIONAL
CONDITIONS RELATING TO THE FINANCIAL CONDITION OF THE PROPOSED TRANSFEREE.
NOTWITHSTANDING THE REGISTRATION IN THE CERTIFICATE REGISTER OR ANY TRANSFER,
SALE OR OTHER DISPOSITION OF THIS CERTIFICATE TO A DISQUALIFIED ORGANIZATION OR
A DISQUALIFIED NON-UNITED STATES PERSON OR AN AGENT THEREOF, 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.
A TRANSFEROR OF THIS CERTIFICATE TO A DISQUALIFIED ORGANIZATION OR AN AGENT WHO
ACQUIRES THIS CERTIFICATE ON BEHALF OF A DISQUALIFIED ORGANIZATION MAY BE
SUBJECT TO A SIGNIFICANT FEDERAL INCOME TAX UNLESS IT PROPERLY RECEIVES THE
TRANSFER AFFIDAVIT AND AGREEMENT DESCRIBED IN SECTION 4.02(d) OF THE AGREEMENT.
THIS CERTIFICATE MAY BE A "NON-ECONOMIC RESIDUAL INTEREST," CERTAIN TRANSFERS OF
WHICH MAY BE DISREGARDED FOR FEDERAL INCOME TAX PURPOSES. EACH HOLDER OF THIS
CERTIFICATE BY ACCEPTANCE OF THIS CERTIFICATE SHALL BE DEEMED TO HAVE CONSENTED
TO THE PROVISIONS OF THIS PARAGRAPH.
<PAGE>
EQCC HOME EQUITY LOAN ASSET BACKED CERTIFICATES
Series 1999-3, Class R-II Percentage Interest of this
No. R-II-__ Certificate:
_____%
Cut-off Date: August 1, 1999 Closing Date:
August 26, 1999
First Distribution Date:
September 27, 1999
This certifies that _________________________ is the registered
owner of the interest (the "PERCENTAGE INTEREST") evidenced by this Certificate
in certain distributions with respect to a Trust Fund consisting primarily of
two groups of fixed-rate and one group of adjustable-rate mortgage loans (the
"MORTGAGE LOANS") master serviced by EquiCredit Corporation of America
(hereinafter called the "SERVICER", in its capacity as Servicer, and
"REPRESENTATIVE", in its capacity as Representative, which terms include any
successor entity under the Agreement referred to below). The Mortgage Loans were
originated or acquired by the Representative and certain of its wholly-owned
subsidiaries. The Mortgage Loans will be serviced by the Servicer pursuant to
the terms and conditions of that certain Pooling and Servicing Agreement dated
as of August 1, 1999 (the "AGREEMENT") by and among the Representative, the
Servicer, EQCC Receivables Corporation, EQCC Asset Backed Corporation and U.S.
Bank National Association, as trustee (the "TRUSTEE"), certain of the pertinent
provisions of which are set forth herein. To the extent not defined herein, the
capitalized terms used herein have the meanings assigned in the Agreement. This
Certificate is issued under and is subject to the terms, provisions and
conditions of the Agreement, to which Agreement the holder of this Certificate
by virtue of the acceptance hereof assents and by which such holder is bound.
On each Distribution Date, commencing on September 27, 1999, the
Trustee shall distribute to the Person in whose name this Certificate is
registered on the last calendar day of the month preceding the month in which
such Distribution Date occurs (the "RECORD DATE"), an amount equal to the
product of the Percentage Interest evidenced by this Certificate and any amount
required to be distributed to the Holders of the Class R-II Certificates on such
Remittance Date pursuant to SECTION 6.05 of the Agreement.
Each Holder of this Certificate will be deemed to have agreed to be
bound by the restrictions set forth in the Agreement to the effect that (i) each
person holding or acquiring any Ownership Interest in this Certificate must be a
Permitted Transferee, (ii) the transfer of any Ownership Interest in this
Certificate will be conditioned upon the delivery to the Trustee of, among other
things, an affidavit to the effect that it is a Permitted Transferee and (iii)
any attempted or purported transfer of any Ownership Interest in this
Certificate in violation of such restrictions will be absolutely null and void
and will vest no rights in the purported transferee. The Percentage Interest of
this Certificate is set forth above. Notwithstanding the fact that this
Certificate has no principal balance, this Certificate will remain outstanding
under the Agreement and the Holder hereof may have additional obligations as set
forth in the Agreement.
No transfer of any Class R-II Certificate shall be made unless that
transfer is made pursuant to an effective registration statement under the 1933
Act and effective registration or qualification under applicable state
securities laws, or is made in a transaction which does not require such
registration or qualification. In the event that a transfer is to be made
without such registration or qualification, (a) the Trustee shall require the
transferee to execute an investment letter, which investment letter shall not be
an expense of the Depositors, the Servicer or the Trustee and (b) in the event
that such a transfer is not made pursuant to Rule 144A under the Act, the
Depositors may direct the Trustee to require an Opinion of Counsel satisfactory
to the Trustee and the Depositors that such transfer may be made without such
registration or qualification, which Opinion of Counsel shall not be an expense
of the Depositors, the Trustee or the Servicer. Neither the Depositors nor the
Trustee is obligated to register or qualify any of the Class R-II Certificates
under the 1933 Act or any other securities law or to take any action not
otherwise required under the Agreement to permit the transfer of such
Certificates without registration or qualification. Any such Certificateholder
desiring to effect such transfer shall, and does hereby agree to, indemnify the
Trustee, the Depositors, the Certificate Insurer and the Servicer against any
liability that may result if the transfer is not so exempt or is not made in
accordance with such federal and state laws. In connection with any such
transfer, the Trustee will also require a representation letter, in the form as
described in the Agreement, stating that the transferee is not an ERISA Plan and
is not acting on behalf of an ERISA Plan or using the assets of an ERISA Plan to
effect such purchase.
<PAGE>
IN WITNESS WHEREOF, the Trustee on behalf of the Trust has caused
this Certificate to be duly executed as of the date set forth below.
EQCC HOME EQUITY LOAN TRUST 1999-3
By: U.S. Bank National Association,
as Trustee
By:___________________________________
Authorized Signatory
Dated:
CERTIFICATE OF AUTHENTICATION
This is one of the Class R-II Certificates referred to in the within-mentioned
Agreement.
By: U.S. Bank National Association,
as Trustee
By:___________________________________
Authorized Signatory
<PAGE>
EXHIBIT B-12
[FORM OF CLASS R-III CERTIFICATE]
THIS CERTIFICATE IS SUBORDINATED IN RIGHT OF PAYMENT TO THE CLASS A AND CLASS X
CERTIFICATES AS DESCRIBED IN THE POOLING AND SERVICING AGREEMENT REFERRED TO
HEREIN.
THIS CERTIFICATE MAY NOT BE HELD BY OR TRANSFERRED TO A DISQUALIFIED NON-U.S.
PERSON OR A DISQUALIFIED ORGANIZATION OR AGENT THEREOF.
SOLELY FOR U.S. FEDERAL INCOME TAX PURPOSES, THIS CERTIFICATE IS A "RESIDUAL
INTEREST" IN A "REAL ESTATE MORTGAGE INVESTMENT CONDUIT" AS THOSE TERMS ARE
DEFINED, RESPECTIVELY, IN SECTIONS 860G AND 860D OF THE INTERNAL REVENUE CODE OF
1986 (THE "CODE").
THIS CERTIFICATE HAS NOT BEEN REGISTERED OR QUALIFIED UNDER THE SECURITIES ACT
OF 1933 (THE "1933 ACT") OR THE SECURITIES LAWS OF ANY STATE. ANY RESALE,
TRANSFER OR OTHER DISPOSITION OF THIS CERTIFICATE WITHOUT SUCH REGISTRATION OR
QUALIFICATION MAY BE MADE ONLY IN A TRANSACTION WHICH DOES NOT REQUIRE SUCH
REGISTRATION OR QUALIFICATION AND WHICH IS IN ACCORDANCE WITH THE PROVISIONS OF
SECTION 4.02 OF THE POOLING AND SERVICING AGREEMENT REFERRED TO HEREIN.
NO TRANSFER OF THIS CERTIFICATE MAY BE MADE TO AN EMPLOYEE BENEFIT PLAN OR OTHER
OR OTHER RETIREMENT ARRANGEMENT, INCLUDING INDIVIDUAL RETIREMENT ACCOUNTS AND
ANNUITIES, KEOGH PLANS AND COLLECTIVE INVESTMENT FUNDS AND SEPARATE ACCOUNTS IN
WHICH SUCH PLANS, ACCOUNTS OR ARRANGEMENTS ARE INVESTED, THAT IS SUBJECT TO THE
FIDUCIARY RESPONSIBILITY PROVISIONS OF THE EMPLOYEE RETIREMENT INCOME SECURITY
ACT OF 1974, AS AMENDED ("ERISA") OR SECTION 4975 OF THE CODE (OR COMPARABLE
PROVISIONS OF ANY SUBSEQUENT ENACTMENTS) (EACH, AN "ERISA PLAN").
ANY RESALE, TRANSFER OR OTHER DISPOSITION OF THIS CERTIFICATE MAY BE MADE ONLY
IF THE PROPOSED TRANSFEREE PROVIDES A TRANSFER AFFIDAVIT TO THE DEPOSITORS AND
THE TRUSTEE THAT (1) SUCH TRANSFEREE IS NOT A DISQUALIFIED ORGANIZATION OR AGENT
THEREOF, (2) NO PURPOSE OF SUCH TRANSFER IS TO IMPEDE THE ASSESSMENT OR
COLLECTION OF TAX AND (3) SUCH TRANSFEREE SATISFIES CERTAIN ADDITIONAL
CONDITIONS RELATING TO THE FINANCIAL CONDITION OF THE PROPOSED TRANSFEREE.
NOTWITHSTANDING THE REGISTRATION IN THE CERTIFICATE REGISTER OR ANY TRANSFER,
SALE OR OTHER DISPOSITION OF THIS CERTIFICATE TO A DISQUALIFIED ORGANIZATION OR
A DISQUALIFIED NON-UNITED STATES PERSON OR AN AGENT THEREOF, 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.
A TRANSFEROR OF THIS CERTIFICATE TO A DISQUALIFIED ORGANIZATION OR AN AGENT WHO
ACQUIRES THIS CERTIFICATE ON BEHALF OF A DISQUALIFIED ORGANIZATION MAY BE
SUBJECT TO A SIGNIFICANT FEDERAL INCOME TAX UNLESS IT PROPERLY RECEIVES THE
TRANSFER AFFIDAVIT AND AGREEMENT DESCRIBED IN SECTION 4.02(d) OF THE AGREEMENT.
THIS CERTIFICATE MAY BE A "NON-ECONOMIC RESIDUAL INTEREST," CERTAIN TRANSFERS OF
WHICH MAY BE DISREGARDED FOR FEDERAL INCOME TAX PURPOSES. EACH HOLDER OF THIS
CERTIFICATE BY ACCEPTANCE OF THIS CERTIFICATE SHALL BE DEEMED TO HAVE CONSENTED
TO THE PROVISIONS OF THIS PARAGRAPH.
<PAGE>
EQCC HOME EQUITY LOAN ASSET BACKED CERTIFICATES
Series 1999-3, Class R-III Percentage Interest of this
No. R-III-__ Certificate:
_____%
Cut-off Date: August 1, 1999 Closing Date:
August 26, 1999
First Distribution Date:
September 27, 1999
This certifies that _________________________ is the registered
owner of the interest (the "PERCENTAGE INTEREST") evidenced by this Certificate
in certain distributions with respect to a Trust Fund consisting primarily of
two groups of fixed-rate and one group of adjustable-rate residential mortgage
loans (the "MORTGAGE LOANS") master serviced by EquiCredit Corporation of
America (hereinafter called the "SERVICER", in its capacity as Servicer, and
"REPRESENTATIVE", in its capacity as Representative, which terms include any
successor entity under the Agreement referred to below). The Mortgage Loans were
originated or acquired by the Representative and certain of its wholly-owned
subsidiaries. The Mortgage Loans will be serviced by the Servicer pursuant to
the terms and conditions of that certain Pooling and Servicing Agreement dated
as of August 1, 1999 (the "AGREEMENT") by and among the Representative, the
Servicer, EQCC Receivables Corporation, EQCC Asset Backed Corporation and U.S.
Bank National Association, as trustee (the "TRUSTEE"), certain of the pertinent
provisions of which are set forth herein. To the extent not defined herein, the
capitalized terms used herein have the meanings assigned in the Agreement. This
Certificate is issued under and is subject to the terms, provisions and
conditions of the Agreement, to which Agreement the holder of this Certificate
by virtue of the acceptance hereof assents and by which such holder is bound.
On each Distribution Date, commencing on September 27, 1999, the
Trustee shall distribute to the Person in whose name this Certificate is
registered on the last calendar day of the month preceding the month in which
such Distribution Date occurs (the "RECORD DATE"), an amount equal to the
product of the Percentage Interest evidenced by this Certificate and any amount
required to be distributed to the Holders of the Class R-III Certificates on
such Remittance Date pursuant to SECTION 6.05 of the Agreement.
Each Holder of this Certificate will be deemed to have agreed to be
bound by the restrictions set forth in the Agreement to the effect that (i) each
person holding or acquiring any Ownership Interest in this Certificate must be a
Permitted Transferee, (ii) the transfer of any Ownership Interest in this
Certificate will be conditioned upon the delivery to the Trustee of, among other
things, an affidavit to the effect that it is a Permitted Transferee, and (iii)
any attempted or purported transfer of any Ownership Interest in this
Certificate in violation of such restrictions will be absolutely null and void
and will vest no rights in the purported transferee. The Percentage Interest of
this Certificate is set forth above. Notwithstanding the fact that this
Certificate has no principal balance, this Certificate will remain outstanding
under the Agreement and the Holder hereof may have additional obligations as set
forth in the Agreement.
No transfer of any Class R-III Certificate shall be made unless that
transfer is made pursuant to an effective registration statement under the 1933
Act and effective registration or qualification under applicable state
securities laws, or is made in a transaction which does not require such
registration or qualification. In the event that a transfer is to be made
without such registration or qualification, (a) the Trustee shall require the
transferee to execute an investment letter, which investment letter shall not be
an expense of the Depositors, the Servicer or the Trustee and (b) in the event
that such a transfer is not made pursuant to Rule 144A under the Act, the
Depositors may direct the Trustee to require an Opinion of Counsel satisfactory
to the Trustee and the Depositors that such transfer may be made without such
registration or qualification, which Opinion of Counsel shall not be an expense
of the Depositors, the Trustee or the Servicer. Neither the Depositors nor the
Trustee is obligated to register or qualify any of the Class R-III Certificates
under the 1933 Act or any other securities law or to take any action not
otherwise required under the Agreement to permit the transfer of such
Certificates without registration or qualification. Any such Certificateholder
desiring to effect such transfer shall, and does hereby agree to, indemnify the
Trustee, the Depositors, the Certificate Insurer and the Servicer against any
liability that may result if the transfer is not so exempt or is not made in
accordance with such federal and state laws. In connection with any such
transfer, the Trustee will also require a representation letter, in the form as
described in the Agreement, stating that the transferee is not an ERISA Plan and
is not acting on behalf of an ERISA Plan or using the assets of an ERISA Plan to
effect such purchase.
<PAGE>
IN WITNESS WHEREOF, the Trustee on behalf of the Trust has caused
this Certificate to be duly executed as of the date set forth below.
EQCC HOME EQUITY LOAN TRUST 1999-3
By: U.S. Bank National Association,
as Trustee
By:___________________________________
Authorized Signatory
Dated:
CERTIFICATE OF AUTHENTICATION
This is one of the Class R-III Certificates referred to in the
within-mentioned Agreement.
By: U.S. Bank National Association,
as Trustee
By:___________________________________
Authorized Signatory
<PAGE>
EXHIBIT B-13
[FORM OF CLASS R-IV CERTIFICATE]
THIS CERTIFICATE IS SUBORDINATED IN RIGHT OF PAYMENT TO THE CLASS A AND CLASS X
CERTIFICATES AS DESCRIBED IN THE POOLING AND SERVICING AGREEMENT REFERRED TO
HEREIN.
THIS CERTIFICATE MAY NOT BE HELD BY OR TRANSFERRED TO A DISQUALIFIED NON-U.S.
PERSON OR A DISQUALIFIED ORGANIZATION OR AGENT THEREOF.
SOLELY FOR U.S. FEDERAL INCOME TAX PURPOSES, THIS CERTIFICATE IS A "RESIDUAL
INTEREST" IN A "REAL ESTATE MORTGAGE INVESTMENT CONDUIT" AS THOSE TERMS ARE
DEFINED, RESPECTIVELY, IN SECTIONS 860G AND 860D OF THE INTERNAL REVENUE CODE OF
1986 (THE "CODE").
THIS CERTIFICATE HAS NOT BEEN REGISTERED OR QUALIFIED UNDER THE SECURITIES ACT
OF 1933 (THE "1933 ACT") OR THE SECURITIES LAWS OF ANY STATE. ANY RESALE,
TRANSFER OR OTHER DISPOSITION OF THIS CERTIFICATE WITHOUT SUCH REGISTRATION OR
QUALIFICATION MAY BE MADE ONLY IN A TRANSACTION WHICH DOES NOT REQUIRE SUCH
REGISTRATION OR QUALIFICATION AND WHICH IS IN ACCORDANCE WITH THE PROVISIONS OF
SECTION 4.02 OF THE POOLING AND SERVICING AGREEMENT REFERRED TO HEREIN.
NO TRANSFER OF THIS CERTIFICATE MAY BE MADE TO AN EMPLOYEE BENEFIT PLAN OR OTHER
OR OTHER RETIREMENT ARRANGEMENT, INCLUDING INDIVIDUAL RETIREMENT ACCOUNTS AND
ANNUITIES, KEOGH PLANS AND COLLECTIVE INVESTMENT FUNDS AND SEPARATE ACCOUNTS IN
WHICH SUCH PLANS, ACCOUNTS OR ARRANGEMENTS ARE INVESTED, THAT IS SUBJECT TO THE
FIDUCIARY RESPONSIBILITY PROVISIONS OF THE EMPLOYEE RETIREMENT INCOME SECURITY
ACT OF 1974, AS AMENDED ("ERISA") OR SECTION 4975 OF THE CODE (OR COMPARABLE
PROVISIONS OF ANY SUBSEQUENT ENACTMENTS) (EACH, AN "ERISA PLAN").
ANY RESALE, TRANSFER OR OTHER DISPOSITION OF THIS CERTIFICATE MAY BE MADE ONLY
IF THE PROPOSED TRANSFEREE PROVIDES A TRANSFER AFFIDAVIT TO THE DEPOSITORS AND
THE TRUSTEE THAT (1) SUCH TRANSFEREE IS NOT A DISQUALIFIED ORGANIZATION OR AGENT
THEREOF, (2) NO PURPOSE OF SUCH TRANSFER IS TO IMPEDE THE ASSESSMENT OR
COLLECTION OF TAX AND (3) SUCH TRANSFEREE SATISFIES CERTAIN ADDITIONAL
CONDITIONS RELATING TO THE FINANCIAL CONDITION OF THE PROPOSED TRANSFEREE.
NOTWITHSTANDING THE REGISTRATION IN THE CERTIFICATE REGISTER OR ANY TRANSFER,
SALE OR OTHER DISPOSITION OF THIS CERTIFICATE TO A DISQUALIFIED ORGANIZATION OR
A DISQUALIFIED NON-UNITED STATES PERSON OR AN AGENT THEREOF, 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.
A TRANSFEROR OF THIS CERTIFICATE TO A DISQUALIFIED ORGANIZATION OR AN AGENT WHO
ACQUIRES THIS CERTIFICATE ON BEHALF OF A DISQUALIFIED ORGANIZATION MAY BE
SUBJECT TO A SIGNIFICANT FEDERAL INCOME TAX UNLESS IT PROPERLY RECEIVES THE
TRANSFER AFFIDAVIT AND AGREEMENT DESCRIBED IN SECTION 4.02(d) OF THE AGREEMENT.
THIS CERTIFICATE MAY BE A "NON-ECONOMIC RESIDUAL INTEREST," CERTAIN TRANSFERS OF
WHICH MAY BE DISREGARDED FOR FEDERAL INCOME TAX PURPOSES. EACH HOLDER OF THIS
CERTIFICATE BY ACCEPTANCE OF THIS CERTIFICATE SHALL BE DEEMED TO HAVE CONSENTED
TO THE PROVISIONS OF THIS PARAGRAPH.
<PAGE>
EQCC HOME EQUITY LOAN ASSET BACKED CERTIFICATES
Series 1999-3, Class R-IV Percentage Interest of this
No. R-IV-__ Certificate:
_____%
Cut-off Date: August 1, 1999 Closing Date:
August 26, 1999
First Distribution Date:
September 27, 1999
This certifies that _________________________ is the registered
owner of the interest (the "PERCENTAGE INTEREST") evidenced by this Certificate
in certain distributions with respect to a Trust Fund consisting primarily of
two groups of fixed-rate and one group of adjustable-rate mortgage loans (the
"MORTGAGE LOANS") master serviced by EquiCredit Corporation of America
(hereinafter called the "SERVICER", in its capacity as Servicer, and
"REPRESENTATIVE", in its capacity as Representative, which terms include any
successor entity under the Agreement referred to below). The Mortgage Loans were
originated or acquired by the Representative and certain of its wholly-owned
subsidiaries. The Mortgage Loans will be serviced by the Servicer pursuant to
the terms and conditions of that certain Pooling and Servicing Agreement dated
as of August 1, 1999 (the "AGREEMENT") by and among the Representative, the
Servicer, EQCC Receivables Corporation, EQCC Asset Backed Corporation and U.S.
Bank National Association, as trustee (the "TRUSTEE"), certain of the pertinent
provisions of which are set forth herein. To the extent not defined herein, the
capitalized terms used herein have the meanings assigned in the Agreement. This
Certificate is issued under and is subject to the terms, provisions and
conditions of the Agreement, to which Agreement the holder of this Certificate
by virtue of the acceptance hereof assents and by which such holder is bound.
On each Distribution Date, commencing on September 27, 1999, the
Trustee shall distribute to the Person in whose name this Certificate is
registered on the last calendar day of the month preceding the month in which
such Distribution Date occurs (the "RECORD DATE"), an amount equal to the
product of the Percentage Interest evidenced by this Certificate and any amount
required to be distributed to the Holders of the Class R-IV Certificates on such
Remittance Date pursuant to SECTION 6.05 of the Agreement.
Each Holder of this Certificate will be deemed to have agreed to be
bound by the restrictions set forth in the Agreement to the effect that (i) each
person holding or acquiring any Ownership Interest in this Certificate must be a
Permitted Transferee, (ii) the transfer of any Ownership Interest in this
Certificate will be conditioned upon the delivery to the Trustee of, among other
things, an affidavit to the effect that it is a Permitted Transferee, and (iii)
any attempted or purported transfer of any Ownership Interest in this
Certificate in violation of such restrictions will be absolutely null and void
and will vest no rights in the purported transferee. The Percentage Interest of
this Certificate is set forth above. Notwithstanding the fact that this
Certificate has no principal balance, this Certificate will remain outstanding
under the Agreement and the Holder hereof may have additional obligations as set
forth in the Agreement.
No transfer of any Class R-IV Certificate shall be made unless that
transfer is made pursuant to an effective registration statement under the 1933
Act and effective registration or qualification under applicable state
securities laws, or is made in a transaction which does not require such
registration or qualification. In the event that a transfer is to be made
without such registration or qualification, (a) the Trustee shall require the
transferee to execute an investment letter, which investment letter shall not be
an expense of the Depositors, the Servicer or the Trustee and (b) in the event
that such a transfer is not made pursuant to Rule 144A under the Act, the
Depositors may direct the Trustee to require an Opinion of Counsel satisfactory
to the Trustee and the Depositors that such transfer may be made without such
registration or qualification, which Opinion of Counsel shall not be an expense
of the Depositors, the Trustee or the Servicer. Neither the Depositors nor the
Trustee is obligated to register or qualify any of the Class R-IV Certificates
under the 1933 Act or any other securities law or to take any action not
otherwise required under the Agreement to permit the transfer of such
Certificates without registration or qualification. Any such Certificateholder
desiring to effect such transfer shall, and does hereby agree to, indemnify the
Trustee, the Depositors, the Certificate Insurer and the Servicer against any
liability that may result if the transfer is not so exempt or is not made in
accordance with such federal and state laws. In connection with any such
transfer, the Trustee will also require a representation letter, in the form as
described in the Agreement, stating that the transferee is not an ERISA Plan and
is not acting on behalf of an ERISA Plan or using the assets of an ERISA Plan to
effect such purchase.
<PAGE>
IN WITNESS WHEREOF, the Trustee on behalf of the Trust has caused
this Certificate to be duly executed as of the date set forth below.
EQCC HOME EQUITY LOAN TRUST 1999-3
By: U.S. Bank National Association,
as Trustee
By:___________________________________
Authorized Signatory
Dated:
CERTIFICATE OF AUTHENTICATION
This is one of the Class R-IV Certificates referred to in the
within-mentioned Agreement.
By: U.S. Bank National Association,
as Trustee
By:___________________________________
Authorized Signatory
<PAGE>
Exhibit B-14
[FORM OF REVERSE OF CERTIFICATE]
[Form of Reverse Certificate]
Distributions on this Certificate will be made by the Trustee by
wire transfer of immediately available funds to the account of the Person
entitled thereto as shall appear on the Certificate Register without the
presentation or surrender of this Certificate or the making of any notation
thereon, at a bank or other entity having appropriate facilities therefor, if
such Person shall own of record Class A Certificates of the same Class which
have denominations aggregating at least $1,000,000 appearing in the Certificate
Register and in all cases with respect to the Class X , Class R-I, Class R-II,
Class R-III and Class R-IV Certificates, and shall have so notified the Trustee
at least five business days prior to the related Record Date, or by check mailed
to the address of such Person appearing in the Certificate Register.
Upon receiving the final distribution hereon, the Holder hereof is
required to send this Certificate to the Trustee. The Agreement provides that,
in any event, upon the making of the final distribution due on this Certificate,
this Certificate shall be deemed cancelled for all purposes under the Agreement.
This Certificate is one of a duly authorized issue of Certificates
designated as EQCC Home Equity Loan Asset Backed Certificates, Series 1999-3,
Class A-1F, Class A-2F, Class A-3F, Class A-4F, Class A-5F, Class A-6F, Class
A-7F, Class A-1A, Class X, Class R-I, Class R-II, Class R-III and Class R-IV
(herein called the "CERTIFICATES") and, as set forth in the Agreement,
representing interests in (i) such Mortgage Loans as from time to time are
subject to the Agreement, together with the Mortgage Files relating thereto and
all proceeds thereof (other than the Representative's Yield), (ii) such assets
as from time to time are identified as REO Property or are deposited in the
Collection Account, Principal and Interest Account (including all earnings
thereon and proceeds thereof), and Insurance Account, including amounts on
deposit in the Accounts or the Principal and Interest Account and invested in
Permitted Instruments, (iii) the Trustee's rights under all insurance policies
with respect to the Mortgage Loans required to be maintained pursuant to the
Agreement and any Insurance Proceeds, (iv) the Certificate Insurance Policy, (v)
Liquidation Proceeds and (vi) Released Mortgaged Property Proceeds (all of the
foregoing being hereinafter collectively called the "TRUST FUND"). The Class X
Certificates are subordinate in right of payment to the Class A Certificates, to
the extent set forth in the Agreement.
The Certificates do not represent an obligation of, or an interest
in, the Servicer, the Representative, the Depositors or the Trustee and are not
insured or guaranteed by the Federal Deposit Insurance Corporation, the
Government National Mortgage Association, the Federal Housing Administration or
the Veterans Administration or any other governmental agency. The Certificates
are limited in right of payment to certain collections and recoveries respecting
the Mortgage Loans, and amounts withdrawable from the Collection Account, all as
more specifically set forth herein and in the Agreement.
Ambac Assurance Corporation has issued a certificate guaranty
insurance policy with respect to the Class A Certificates, a copy of which is
attached as EXHIBIT I to the Agreement.
As provided in the Agreement, deposits and withdrawals from the
Collection Account and the Insurance Account may be made by the Trustee from
time to time for purposes other than distributions to Certificateholders, such
purposes including reimbursement of certain expenses incurred by the Servicer
and investment in Permitted Instruments.
Subject to certain restrictions, the Agreement permits the amendment
thereof with respect to certain modifications (a) by the Depositors, the
Servicer and the Trustee, with the prior written consent of the Certificate
Insurer, without the consent of the Certificateholders, and (b) by the
Depositors, the Representative, the Servicer, the Trustee, with the prior
written consent of the Certificate Insurer, the Majority in Aggregate Voting
Interest and the holders of a majority of the Percentage Interest in the Class
R-I, Class R-II, Class R-III and Class R-IV Certificates. The Agreement permits
the Majority in Aggregate Voting Interest to waive, on behalf of all
Certificateholders, any default by the Servicer in the performance of its
obligations under the Agreement and its consequences, except a default in making
any required distribution on a Certificate. Any such consent or waiver by the
Majority in Aggregate Voting Interest shall be conclusive and binding on the
holder of this Certificate 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.
As provided in the Agreement and subject to certain limitations
therein set forth, the transfer of this Certificate is registrable in the
Certificate Register upon surrender of this Certificate for registration of
transfer at the offices or agencies maintained by the Trustee in New York, New
York or Chicago, Illinois duly endorsed by, or accompanied by a written
instrument of transfer in form satisfactory to, the Trustee, 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 aggregate undivided Percentage Interest will be issued to the
designated transferee or transferees.
The Certificates are issuable only as registered Certificates. As
provided in the Agreement and subject to certain limitations therein set forth,
the Certificate is exchangeable for a new Certificate evidencing the same
undivided ownership interest, as requested by the holder surrendering the same.
No service charge will be made for any such registration of transfer
or exchange, but the Trustee may require payment of a sum sufficient to cover
any tax or other governmental charge payable in connection therewith.
The Servicer, the Representative, the Depositors and the Trustee and
any agent of any of the foregoing, may treat the person in whose name this
Certificate is registered as the owner hereof for all purposes, and none of the
foregoing shall be affected by notice to the contrary.
The obligations created by the Agreement shall terminate upon notice
to the Trustee of: (i) the later of the distribution to Certificateholders of
the final payment or collection with respect to the last Mortgage Loan, or the
disposition of all funds with respect to the last Mortgage Loan and the
remittance of all funds due under the Agreement and the payment of all amounts
due and payable to the Certificate Insurer and the Trustee, (ii) the purchase by
the Servicer of all outstanding Mortgage Loans and REO Properties at a price
determined as provided in the Agreement (the exercise of the right of the
Servicer to purchase all the Mortgage Loans and property in respect of Mortgage
Loans will result in early retirement of the Certificates), the right of the
Servicer to purchase being subject to the Pool Principal Balance of the Mortgage
Loans and REO Properties at the time of purchase being less than ten percent
(10%) of the Original Pool Principal Balance, (iii) by the mutual consent of the
Servicer, the Certificate Insurer and all Certificateholders in writing or (iv)
upon the failure of the Trust to qualify as four separate REMICs, pursuant to
SECTION 11.05 of the Agreement. By its acceptance of this Certificate, the
Certificateholder hereby appoints the Servicer as its attorney-in-fact to adopt
a plan of liquidation of the Trust Fund in accordance with SECTION 11.02 of the
Agreement.
Unless the certificate of authentication hereon has been executed by
the Trustee by manual signature, this Certificate shall not be entitled to any
benefit under the Agreement or be valid for any purpose.
<PAGE>
EXHIBIT C
DTC LETTER OF REPRESENTATIONS
<PAGE>
EXHIBIT D
MORTGAGE LOAN SCHEDULES
<PAGE>
ADJUSTABLE RATE GROUP
<PAGE>
FIXED RATE GROUP 1
<PAGE>
FIXED RATE GROUP 2
<PAGE>
EXHIBIT E
FORM OF TRUSTEE INITIAL CERTIFICATION
_______, 199_
[Representative]
[Insurer]
[Servicer]
[Depositors]
Re: Pooling and Servicing Agreement (the "POOLING AND SERVICING
AGREEMENT"), EQCC Home Equity Loan Asset Backed Certificates, Series
1999-3, Class A-1F, Class A-2F, Class A-3F, Class A-4F, Class A-5F,
Class A-6F, Class A-7F, Class A-1A, Class X, Class R-I, Class R-II,
Class R-III and Class R-IV, dated as of August 1, 1999 among
EquiCredit Corporation of America, as Servicer, the DEPOSITORS LISTED
THEREIN AND U.S. BANK NATIONAL ASSOCIATION, AS TRUSTEE
Ladies and Gentlemen:
In accordance with SECTION 2.06 of the Pooling and Servicing
Agreement, the undersigned, as Trustee, hereby certifies that, except as noted
on the Master Exception Report dated __, 1999 and made a part hereof, it or the
Custodian on its behalf has received, with respect to each Mortgage Loan (other
than any Mortgage Loan paid in full or any Mortgage Loan listed on the
attachment hereto), the documents specified in SECTIONS 2.04(A), (B), (C), (G)
AND (H) of the Pooling and Servicing Agreement, as applicable, a Mortgage, or a
certified copy thereof, an Assignment of Mortgage, or a certified copy thereof,
and a Mortgage Note with respect to each Mortgage Loan listed in the Mortgage
Loan Schedule and the documents contained therein appear to bear original
signatures or copies of originals if the originals have not yet been delivered.
Neither the Trustee nor the Custodian on its behalf has made any
independent examination of any such documents beyond the review specifically
required in the above-referenced Pooling and Servicing Agreement. The Trustee
makes no representations as to: (i) the validity, legality, sufficiency,
enforceability or genuineness of any such documents or any of the Mortgage Loans
identified on the Mortgage Loan Schedule, or (ii) collectability, insurability,
effectiveness or suitability of any such Mortgage Loan.
Capitalized words and phrases used herein shall have the respective
meanings assigned to them in the above-captioned Pooling and Servicing
Agreement.
U.S. BANK NATIONAL ASSOCIATION
By: _______________________________________
Name:
Title:
<PAGE>
EXHIBIT F-1
FORM OF TRUSTEE INTERIM CERTIFICATION
, 19__
[Representative]
[Insurer]
[Depositors]
[Servicer]
Re: Pooling and Servicing Agreement (the "POOLING AND SERVICING
AGREEMENT"), EQCC Home Equity Loan Asset Backed Certificates, Series
1999-3, Class A-1F, Class A-2F, Class A-3F, Class A-4F, Class A-5F,
Class A-6F, Class A-7F, Class A-1A, Class X, Class R-I, Class R-II,
Class R-III and Class R-IV, dated as of August 1, 1999, among
EquiCredit Corporation of America, as Servicer, the DEPOSITORS LISTED
THEREIN AND U.S. BANK NATIONAL ASSOCIATION, AS TRUSTEE
Ladies and Gentlemen:
In accordance with the provisions of SECTION 2.06 of the
above-referenced Pooling and Servicing Agreement, the undersigned, as Trustee,
hereby certifies that as to each Mortgage Loan listed in the Mortgage Loan
Schedule (other than any Mortgage Loan paid in full or any Mortgage Loan listed
on the attachment hereto), it or the Custodian on its behalf has reviewed the
documents delivered to it or the Custodian on its behalf pursuant to SECTION
2.04 of the Pooling and Servicing Agreement and has determined that (i) all such
documents are in its possession or in the possession of the Custodian on its
behalf (other than those listed in SECTION 2.04(F)), (ii) such documents have
been reviewed by it or the Custodian on its behalf and have not been mutilated,
damaged, torn or otherwise physically altered and relate to such Mortgage Loan,
(iii) based on its examination, or the examination of the Custodian on its
behalf, and only as to the foregoing documents, the information set forth in the
Mortgage Loan Schedule (other than items (i), (iv) and (x) of the definition of
Mortgage Loan Schedule) respecting such Mortgage Loan accurately reflects the
information set forth in the Mortgage File and (iv) each Mortgage Note has been
endorsed as provided in SECTION 2.04 of the Pooling and Servicing Agreement.
Neither the Trustee nor the Custodian on its behalf has made any
independent examination of such documents beyond the review specifically
required in the above-referenced Pooling and Servicing Agreement. The Trustee
makes no representations as to: (i) the validity, legality, enforceability or
genuineness of any such documents contained in each or any of the Mortgage Loans
identified on the Mortgage Loan Schedule, or (ii) the collectability,
insurability, effectiveness or suitability of any such Mortgage Loan.
Capitalized words and phrases used herein shall have the respective
meanings assigned to them in the above-captioned Pooling and servicing
Agreement.
___________________________________________,
as Trustee
By: ________________________________________
Name:
Title:
<PAGE>
EXHIBIT F-2
FORM OF TRUSTEE FINAL CERTIFICATION
, 19__
[Representative]
[Insurer]
[Depositors]
[Servicer]
Re: Pooling and Servicing Agreement (the "POOLING AND SERVICING
AGREEMENT"), EQCC Home Equity Loan Asset Backed Certificates, Series
1999-3, Class A-1F, Class A-2F, Class A-3F, Class A-4F, Class A-5F,
Class A-6F, Class A-7F, Class A-1A, Class X, Class R-I, Class R-II,
Class R-III and Class R-IV, dated as of August 1, 1999 among
EquiCredit Corporation of America, as Servicer, the DEPOSITORS LISTED
THEREIN AND U.S. BANK NATIONAL ASSOCIATION, AS TRUSTEE
Ladies and Gentlemen:
In accordance with SECTION 2.06 of the above-captioned Pooling and
Servicing Agreement, the undersigned, as Trustee, hereby certifies that, except
as noted on the attachment hereto, as to each Mortgage Loan listed in the
Mortgage Loan Schedule (other than any Mortgage Loan paid in full or listed on
the attachment hereto) it or to the Custodian on its behalf has reviewed the
documents delivered to it or to the Custodian on its behalf pursuant to SECTION
2.04 of the Pooling and Servicing Agreement and has determined that (i) all such
documents are in its possession or in the possession of the Custodian on its
behalf (other than those listed in SECTION 2.04(F)), (ii) such documents have
been reviewed by it and have not been mutilated, damaged, torn or otherwise
physically altered and relate to such Mortgage loan, (iii) based on its
examination, and only as to the foregoing documents, the information set forth
in the Mortgage Loan Schedule (other than items (i), (iv) and (x) of the
definition of Mortgage Loan Schedule) respecting such Mortgage Loan accurately
reflects the information set forth in the Trustee's Mortgage File and (iv) each
Mortgage Note has been endorsed as provided in SECTION 2.04 of the Pooling and
Servicing Agreement. Neither the Trustee nor the Custodian on its behalf has
made any independent examination of such documents beyond the review
specifically required in the above-referenced Pooling and Servicing Agreement.
The Trustee makes no representations as to: (i) the validity, legality,
enforceability or genuineness of any such documents contained in each or any of
the Mortgage Loans identified on the Mortgage Loan Schedule, or (ii) the
collectability, insurability, effectiveness or suitability of any such Mortgage
Loan.
Capitalized words and phrases used herein shall have the respective
meanings assigned to them in the above-captioned Pooling and Servicing
Agreement.
___________________________________________,
as Trustee
By: ________________________________________
Name:
Title:
<PAGE>
EXHIBIT G
LIST OF BANKRUPTCY LOANS
<PAGE>
EXHIBIT H
FORM OF DELINQUENCY REPORT
Mortgage Pool
% of
Number of Principal Aggregate
Accounts Balance Principal
-------------- ------------- -------------
Potentially Delinquent $ %
30 Days Delinquent
60 Days Delinquent
90 or More Days
Delinquent
Rolling 3 Month Average 90 or
More Days Delinquent
Rolling 6 Month Average 90 or
MORE DAYS DELINQUENT
- --------------------
In Foreclosure
In Bankruptcy
30 Days Delinquent
60 Days Delinquent
90 or More Days
Delinquent
In REO
Fixed Rate Group 1
% of
Number of Principal Aggregate
Accounts Balance Principal
-------------- ------------- -------------
Potentially Delinquent $ %
30 Days Delinquent
60 Days Delinquent
90 or More Days
Delinquent
Rolling 3 Month Average 90 or
More Days Delinquent
Rolling 6 Month Average 90 or
MORE DAYS DELINQUENT
- --------------------
In Foreclosure
In Bankruptcy
30 Days Delinquent
60 Days Delinquent $ %
90 or More Days
Delinquent
In REO
Fixed Rate Group 2
% of
Number of Principal Aggregate
Accounts Balance Principal
-------------- ------------- -------------
Potentially Delinquent $ %
30 Days Delinquent
60 Days Delinquent
90 or More Days
Delinquent
Rolling 3 Month Average 90 or
More Days Delinquent
Rolling 6 Month Average 90 or
MORE DAYS DELINQUENT
- --------------------
In Foreclosure
In Bankruptcy
30 Days Delinquent
60 Days Delinquent
90 or More Days
Delinquent
In REO
Adjustable Rate Group
% of
Number of Principal Aggregate
Accounts Balance Principal
-------------- ------------- -------------
Potentially Delinquent $ %
30 Days Delinquent
60 Days Delinquent
90 or More Days
Delinquent
Rolling 3 Month Average 90 or
More Days Delinquent
Rolling 6 Month Average 90 or
MORE DAYS DELINQUENT
- --------------------
In Foreclosure $ %
In Bankruptcy
30 Days Delinquent
60 Days Delinquent
90 or More Days
Delinquent
In REO
<PAGE>
EXHIBIT I
CERTIFICATE INSURANCE POLICY
<PAGE>
EXHIBIT J
FORM OF TRANSFEROR CERTIFICATE
__________________, 19__
EQCC Receivables Corporation
EQCC Asset Backed Corporation
[ADDRESS]
U.S. Bank National Association
180 East Fifth Street
St. Paul, Minnesota 55101
Re: EQCC Home Equity Loan Asset Backed Certificates, Series 1999-3, CLASS
[R-I][R-II][R-III][R-IV]
Ladies and Gentlemen:
This letter is delivered to you in connection with the transfer by
_______________________________ (the "Seller") to __________________________
(the "Purchaser") of a ____% Percentage Interest of EQCC Home Equity Loan Asset
Backed Certificates, Series 1999-3, Class [R-I][R-II][R-III][R-IV] (the
"Certificates"), pursuant to Section 4.02 of the Pooling and Servicing Agreement
(the "Pooling and Servicing Agreement"), dated as of dated as of August 1, 1999
by and among EquiCredit Corporation of America, as Representative and Servicer,
the Depositors listed therein ("DEPOSITORS") and U.S. Bank National Association,
as trustee ("Trustee"). All terms used herein and not otherwise defined shall
have the meanings set forth in the Pooling and Servicing Agreement. The Seller
hereby certifies, represents and warrants to, and covenants with, the Company
and the Trustee that:
1. No purpose of the Seller relating to the transfer of the
Certificates by the Seller to the Purchaser is or will be to impede the
assessment or collection of any tax.
2. The Seller understands that the Purchaser has delivered to the
Trustee and the Servicer a transfer affidavit and agreement in the form attached
to the Pooling and Servicing Agreement as Exhibit M-1. The Seller does not know
or believe that any representation contained therein is false.
3. The Seller has at the time of the transfer conducted a reasonable
investigation of the financial condition of the Purchaser as contemplated by
Treasury Regulations Section 1.860E-1(c)(4)(i) and, as a result of that
investigation, the Seller has determined that the Purchaser has historically
paid its debts as they become due and has found no significant evidence to
indicate that the Purchaser will not continue to pay its debts as they become
due in the future. The Seller understands that the transfer of a Class
[R-I][R-II][R-III][R-IV] Certificate may not be respected for United States
income tax purposes (and the Seller may continue to be liable for United States
income taxes associated therewith) unless the Seller has conducted such an
investigation.
4. The Seller has no actual knowledge that the proposed Purchaser
(i) is not (x) a United States Person, (y) is a person other than a U.S. Person
(a "Non-U.S. Person") that holds the Class [R-I][R-II][R-III][R-IV] Certificate
in connection with the conduct of a trade or business within the United States
and has furnished the transferor and the Trustee with an effective Internal
Revenue Service Form 4224 or successor form at the time and in the manner
required by the Code or (z) is a Non-U.S. Person that has delivered to both the
transferor and the Trustee an opinion of a nationally recognized tax counsel to
the effect that the transfer of the Class [R-I][R-II][R-III][R-IV] Certificate
to it is in accordance with the requirements of the Code and the regulations
promulgated thereunder and that such transfer of the Class
[R-I][R-II][R-III][R-IV] Certificate will not be disregarded for federal income
tax purposes and (ii) is not a Permitted Transferee.
Very truly yours,
____________________________________________
(Seller)
By:_________________________________________
Name:
Title:
<PAGE>
EXHIBIT K
LIST OF ORIGINATORS
EquiCredit Corporation of America
EquiCredit Corporation/Ala. & Miss.
California/EquiCredit Corporation
EquiCredit Corporation of In.
EquiCredit Corporation of Pa.
EquiCredit Corporation of SC
<PAGE>
EXHIBIT L
[RESERVED]
<PAGE>
EXHIBIT M-1
FORM OF TRANSFER 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 EQCC Home Equity Loan Asset Backed Certificates, Series
1999-3, Class [R-I][R-II][R-III][R-IV] (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 [date of transfer] within the meaning of Section 860E(e)(5)
of the Internal Revenue Code of 1986, as amended (the "Code"), (ii) will
endeavor to remain other than a disqualified organization for so long as it
retains its ownership interest in the Class [R-I][R-II][R-III][R-IV]
Certificates, and (iii) is acquiring the Class [R-I][R-II][R-III][R-IV]
Certificates 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, 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, 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 Class [R-I][R-II][R-III][R-IV] Certificates to disqualified
organizations under the Code; (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 furnishes 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-I][R-II][R-III][R-IV] Certificates may be "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, unless no
significant purpose of the transfer was to impede the assessment or collection
of tax.
4. That the Owner is aware that the Trustee will not register the
transfer of any Class [R-I][R-II][R-III][R-IV] Certificates unless the
transferee, or the transferee's agent, delivers to it 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.
5. That the Owner has reviewed the restrictions set forth on the
face of the Class [R-I][R-II][R-III][R-IV] Certificates and the provisions of
Section 4.02(d) of the Pooling and Servicing Agreement under which the Class
[R-I][R-II][R-III][R-IV] Certificates were issued (in particular, clause (6) of
Section 4.02(d) which authorize the Trustee to deliver payments to a person
other than the Owner in the event the Owner holds such Certificates in violation
of Section 4.02(c)). The Owner expressly agrees to be bound by and to comply
with such restrictions and provisions.
6. 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-I][R-II][R-III][R-IV]
Certificates will only be owned, directly or indirectly, by an Owner that is not
a disqualified organization.
7. The Owner's Taxpayer Identification Number is ___________.
8. This affidavit and agreement relates only to the Class
[R-I][R-II][R-III][R-IV] Certificates held by the Owner and not to any other
holder of the Class [R-I][R-II][R-III][R-IV] Certificates. The Owner understands
that the liabilities described herein relate only to the Class
[R-I][R-II][R-III][R-IV] Certificates.
9. That no purpose of the Owner relating to the transfer of any of
the Class [R-I][R-II][R-III][R-IV] Certificates by the Owner is or will be to
impede the assessment or collection of any 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. In this regard, the Owner hereby represents to
and for the benefit of the person from whom it acquired the Class
[R-I][R-II][R-III][R-IV] Certificate that the Owner intends to pay taxes
associated with holding such Class [R-I][R-II][R-III][R-IV] Certificate as they
become due, fully understanding that it may incur tax liabilities in excess of
any cash flows generated by the Class [R-I][R-II][R-III][R-IV] Certificate.
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 Class [R-I][R-II][R-III][R-IV] Certificates remain outstanding.
12. That the Owner (i) is a U.S. Person or (ii) is a person other
than a U.S. Person (a "Non-U.S. Person") that holds the Class
[R-I][R-II][R-III][R-IV]Certificate in connection with the conduct of a trade or
business within the United States and has furnished the transferor and the
Trustee with an effective Internal Revenue Service Form 4224 or successor form
at the time and in the manner required by the Code or (iii) is a Non-U.S. Person
that has delivered to both the transferor and the Trustee an opinion of a
nationally recognized tax counsel to the effect that the transfer of the Class
[R-I][R-II][R-III][R-IV] Certificate to it is in accordance with the
requirements of the Code and the regulations promulgated thereunder and that
such transfer of the Class [R-I][R-II][R-III][R-IV] Certificate will not be
disregarded for federal income tax purposes. "U.S. Person" means a citizen or
resident of the United States, a corporation, partnership (unless, in the case
of a partnership, Treasury regulations are adopted that provide otherwise)
created or organized in or under the laws of the United States, any state
thereof or the District of Columbia, including an entity treated as a
corporation or partnership for federal income tax purposes, an estate that is
subject to United States federal income tax regardless of its income, or a trust
if a court within the United States is able to exercise primary supervision over
the administration of such trust, and one or more such U.S. Persons have the
authority to control all substantial decisions of such trust (or, to the extent
provided in applicable Treasury regulations, certain trusts in existence on
August 20, 1996 which are eligible to be treated as U.S. Persons).
<PAGE>
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 _______________, 199__.
[NAME OF OWNER]
By:_______________________________________
[Name of Officer]
[Title of Officer]
[Corporate Seal]
ATTEST:
[Assistant] Secretary
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 the free act and deed of
the Owner.
Subscribed and sworn before me this ____ day of ________________,
199__.
____________________________________________
NOTARY PUBLIC
COUNTY OF___________________________________
STATE OF____________________________________
My Commission expires the ____ day of
_______________, 19__.
<PAGE>
EXHIBIT M-2
FORM OF INVESTOR REPRESENTATION LETTER
____________,_____
U.S. Bank National Association
180 East Fifth Street
St. Paul, Minnesota 55101
Re: EQCC Home Equity Loan Asset Backed Certificates, Series 1999-3
Ladies and Gentlemen:
_______________________ (the "Purchaser") intends to purchase from
____________________ (the "Seller"), a ____% Percentage Interest of EQCC Home
Equity Loan Asset Backed Certificates, Series 1999-3, Class
[X][R-I][R-II][R-III][R-IV] (the "Certificates"), issued pursuant to the Pooling
and Servicing Agreement (the "Pooling and Servicing Agreement"), dated as of
August 1, 1999, among U.S. Bank National Association, as trustee (the
"Trustee"), Equicredit Corporation of America, EQCC Receivables Corporation and
EQCC Asset Backed Corporation (collectively with EQCC Receivables Corporation,
the "Depositors"). All terms used herein and not otherwise defined shall have
the meanings set forth in the Pooling and Servicing Agreement. The Purchaser
hereby certifies, represents and warrants to, and covenants with, the Company
and the Trustee that:
1. The Purchaser understands that (a) the Certificates have not been
and will not be registered or qualified under the Securities Act of 1933,
as amended (the "Act") or any state securities law, (b) the Company is not
required to so register or qualify the Certificates, (c) the Certificates
may be resold only if registered and qualified pursuant to the provisions
of the Act or any state securities law, or if an exemption from such
registration and qualification is available, (d) the Pooling and Servicing
Agreement contains restrictions regarding the transfer of the Certificates
and (e) the Certificates will bear a legend to the foregoing effect.
2. The Purchaser is acquiring the Certificates for its own account
for investment only and not with a view to or for sale in connection with
any distribution thereof in any manner that would violate the Act or any
applicable state securities laws.
3. The Purchaser is (a) a substantial, sophisticated institutional
investor having such knowledge and experience in financial and business
matters, and, in particular, in such matters related to securities similar
to the Certificates, such that it is capable of evaluating the merits and
risks of investment in the Certificates, (b) able to bear the economic
risks of such an investment and (c) an "accredited investor" within the
meaning of Rule 501(a) promulgated pursuant to the Act.
4. The Purchaser has been furnished with, and has had an opportunity
to review a copy of the Private Placement Memorandum dated ___________,
_____, relating to the Certificates, the Pooling and Servicing Agreement
and such other information concerning the Certificates, the Mortgage Loans
and the Company as has been requested by the Purchaser from the Company or
the Seller and is relevant to the Purchaser's decision to purchase the
Certificates. The Purchaser has had any questions arising from such review
answered by the Company or the Seller to the satisfaction of the
Purchaser.
5. The Purchaser has not and will not nor has it authorized or will
it authorize any person to (a) offer, pledge, sell, dispose of or
otherwise transfer any Certificate, any interest in any Certificate or any
other similar security to any person in any manner, (b) solicit any offer
to buy or to accept a pledge, disposition of other transfer of any
Certificate, any interest in any Certificate or any other similar security
from any person in any manner, (c) otherwise approach or negotiate with
respect to any Certificate, any interest in any Certificate or any other
similar security with any person in any manner, (d) make any general
solicitation by means of general advertising or in any other manner or (e)
take any other action, that (as to any of (a) through (e) above) would
constitute a distribution of any Certificate under the Act, that would
render the disposition of any Certificate a violation of Section 5 of the
Act or any state securities law, or that would require registration or
qualification pursuant thereto. The Purchaser will not sell or otherwise
transfer any of the Certificates, except in compliance with the provisions
of the Pooling and Servicing Agreement.
[6. For Class X Certificates] Either (A) the Purchaser is not an
employee benefit plan or other retirement arrangement subject to the
Employee Retirement Income Security Act of 1974, as amended ("ERISA"), or
Section 4975 of the Internal Revenue Code of 1986, as amended (the "Code")
(collectively, an "ERISA Plan"), and is not acting on behalf of, as named
fiduciary of, as trustee of, or investing the assets of an ERISA Plan, (B)
if the Purchaser is an insurance company, all funds used to purchase the
Class X Certificates are from an "insurance company general account" (as
such term is defined in Section V(e) of Prohibited Transaction Class
Exemption 95-60 ("PTE 95-60"), 60 Fed. Reg. 35925 (July 12, 1995) and
there is no ERISA Plan with respect to which the amount of such general
account's reserves and liabilities for the contract(s) held by or on
behalf of such ERISA Plan and all other ERISA Plans maintained by the same
employer (or affiliate thereof as defined in Section V(a)(1) of PTE 95-60)
or by the same employee organization exceeds 10% of the total of all
reserves and liabilities of such general account (as such amounts are
determined under Section I(a) of PTE 95-60) at the date of acquisition or
(C) the Purchaser has provided a certification of facts and an opinion of
counsel which establish to the satisfaction of the Company and the Trustee
that such transfer will not result in a violation of Section 406 of ERISA
or Section 4975 of the Code or cause the Servicer or the Trustee to be
deemed a fiduciary of such ERISA Plan or result in the imposition of an
excise tax under Section 4975 of the Code.
[6. For Class R-I, Class R-II, Class R-III and Class R-IV
Certificates] The Purchaser is not an employee benefit plan or other
retirement arrangement subject to the Employee Retirement Income Security
Act of 1974, as amended ("ERISA"), or Section 4975 of the Internal
Revenue Code of 1986, as amended (the "Code"), (collectively, an "ERISA
Plan"), and is not acting on behalf of, as named fiduciary of, as trustee
of, or investing the assets of an ERISA Plan.
Very truly yours,
By:_______________________________________
Name:
Title:
<PAGE>
EXHIBIT M-3
Form of Transferor Representation Letter
___________, 199__
U.S. Bank National Association
180 East Fifth Street
St. Paul, Minnesota 55101
Re: EQCC Home Equity Loan Asset Backed Certificates, Series 1999-3
Ladies and Gentlemen:
In connection with the sale by _____________ (the "Seller") to
__________________ (the "Purchaser") of [$___________ initial Certificate
Principal Balance][_____% Percentage Interest] of EQCC Home Equity Loan Asset
Backed Certificates, Series 1999-3, Class [X][R-I][R-II][R-III][R-IV] (the
"Certificates"), issued pursuant to the Pooling and Servicing Agreement (the
"Pooling and Servicing Agreement"), dated as of August 1, 1999, among U.S. Bank
National Association, as trustee (the "Trustee"), Equicredit Corporation of
America, EQCC Receivables Corporation and EQCC Asset Backed Corporation
(collectively, the "Company"). The Seller hereby certifies, represents and
warrants to, and covenants with, the Company and the Trustee that:
Neither the Seller nor anyone acting on its behalf has (a) offered,
pledged, sold, disposed of or otherwise transferred any Certificate, any
interest in any Certificate or any other similar security to any person in any
manner, (b) has solicited any offer to buy or to accept a pledge, disposition or
other transfer of any Certificate, any interest in any Certificate or any other
similar security from any person in any manner, (c) has otherwise approached or
negotiated with respect to any Certificate, any interest in any Certificate or
any other similar security with any person in any manner, (d) has made any
general solicitation by means of general advertising or in any other manner, or
(e) has taken any other action, that (as to any of (a) through (e) above) would
constitute a distribution of the Certificates under the Securities Act of 1933,
as amended (the "Act"), that would render the disposition of any Certificate a
violation of Section 5 of the Act or any state securities law, or that would
require registration or qualification pursuant thereto. The Seller will not act
in any manner set forth in the foregoing sentence with respect to any
Certificate. The Seller has not and will not sell or otherwise transfer any of
the Certificates, except in compliance with the provisions of the Pooling and
Servicing Agreement.
Very truly yours,
____________________________________________
(Seller)
By:_________________________________________
Name:
Title:
<PAGE>
EXHIBIT M-4
[FORM OF RULE 144A INVESTMENT REPRESENTATION]
Description of Rule 144A Securities, including numbers:
EQCC Home Equity Loan
Asset Backed Certificates
Series 1999-3, Class ___, No. ___
The undersigned Seller, as registered holder (the "Transferor"),
intends to transfer the Rule 144A Securities described above to the undersigned
buyer (the "Buyer").
1. In connection with such transfer and in accordance with the
agreements pursuant to which the Rule 144A Securities were issued, the
Transferor hereby certifies the following facts: Neither the Transferor nor
anyone acting on its behalf has offered, transferred, pledged, sold or otherwise
disposed of the Rule 144A Securities, any interest in the Rule 144A Securities
or any other similar security to, or solicited any offer to buy or accept a
transfer, pledge or other disposition of the Rule 144A Securities, or otherwise
approached or negotiated with respect to the Rule 144A Securities, any interest
in the Rule 144A Securities or any other similar security with, any person in
any manner, or made any general solicitation by means of general advertising or
in any other manner, or taken any other action, which would constitute a
distribution of the Rule 144A Securities under the Securities Act of 1933, as
amended (the "1933 Act"), or which would render the disposition of the Rule 144A
Securities a violation of Section 5 of the 1933 Act or require registration
pursuant thereto, and that the Transferor has not offered the Rule 144A
Securities to any person other than the Buyer or another "qualified
institutional buyer" as defined in Rule 144A under the 1933 Act.
2. The Buyer warrants and represents to, and covenants with, the
Transferor, the Trustee and the Servicer pursuant to Section 4.02 of the Pooling
and Servicing Agreement as follows:
a. The Buyer understands that the Rule 144A Securities have
not been registered under the 1933 Act or the securities laws of any
state.
b. The Buyer considers itself a substantial, sophisticated
institutional investor having such knowledge and experience in financial
and business matters that it is capable of evaluating the merits and risks
of investment in the Rule 144A Securities.
c. The Buyer has been furnished with all information regarding
the Rule 144A Securities that it has requested from the Transferor, the
Trustee or the Servicer.
d. Neither the Buyer nor anyone acting on its behalf has
offered, transferred, pledged, sold or otherwise disposed of the Rule 144A
Securities, any interest in the Rule 144A Securities or any other similar
security to, or solicited any offer to buy or accept a transfer, pledge or
other disposition of the Rule 144A Securities, any interest in the Rule
144A Securities or any other similar security from, or otherwise
approached or negotiated with respect to the Rule 144A Securities, any
interest in the Rule 144A Securities or any other similar security with,
any person in any manner, or made any general solicitation by means of
general advertising or in any other manner, or taken any other action,
that would constitute a distribution of the Rule 144A Securities under the
1933 Act or that would render the disposition of the Rule 144A Securities
a violation of Section 5 of the 1933 Act or require registration pursuant
thereto, nor will it act, nor has it authorized or will it authorize any
person to act, in such manner with respect to the Rule 144A Securities.
e. The Buyer is a "qualified institutional buyer" as that term
is defined in Rule 144A under the 1933 Act. The Buyer is aware that the
sale to it is being made in reliance on Rule 144A. The Buyer is acquiring
the Rule 144A Securities for its own account or the account of other
qualified institutional buyers, understands that such Rule 144A Securities
may be resold, pledged or transferred only (i) to a person reasonably
believed to be a qualified institutional buyer that purchases for its own
account or for the account of a qualified institutional buyer to whom
notice is given that the resale, pledge or transfer is being made in
reliance on Rule 144A, or (ii) pursuant to another exemption from
registration under the 1933 Act.
3. The Buyer warrants and represents to, and covenants with, the
Transferor, the Servicer and the Representative that the Buyer is not an
employee benefit plan or other retirement arrangement subject to the Employee
Retirement Income Security Act of 1974, as amended ("ERISA"), or Section 4975 of
the Internal Revenue Code of 1986, as amended (the "Code") (collectively, an
"ERISA Plan"), and is not acting on behalf of, as named fiduciary of, as trustee
of, or investing the assets of an ERISA Plan.
4. This document may be executed in one or more counterparts and by
the different parties hereto on separate counterparts, each of which, when so
executed, shall be deemed to be an original; such counterparts, together, shall
constitute one and the same document.
<PAGE>
IN WITNESS WHEREOF, each of the parties has executed this document
as of the date set forth below.
_________________________________ _________________________________
Print Name of Transferor Print Name of Buyer
By:____________________________________ By:____________________________________
Name: Name:
Title: Title:
<PAGE>
EXHIBIT N
FORM OF CUSTODIAL AGREEMENT
(See Item 4)
<PAGE>
EXHIBIT O
FORM OF LIQUIDATION REPORT
Customer Name:
Account Number:
Original Principal Balance:
1. Liquidation Proceeds
Principal Prepayment $ ________
Property Sale Proceeds ________
Insurance Proceeds ________
Other (Itemize) ________
Total Proceeds $_______
2. Servicing Advances $ ________
Monthly Advances ________
Servicing Fees ________
Total Advances $_______
3. Net Liquidation Proceeds $_______
(Line 1 minus Line 2)
4. Principal Balance of the Mortgage $_______
Loan on date of liquidation
5. Loss, if any $_______
(Line 4 minus Line 3)
<PAGE>
EXHIBIT P
FORM OF PRINCIPAL AND INTEREST ACCOUNT LETTER AGREEMENT
(date)
To: (THE "ACCOUNT DEPOSITORY")
____________________________________
____________________________________
As "Servicer" under the Pooling and Servicing Agreement, dated as of
August 1, 1999 (the "AGREEMENT") with respect to EQCC Home Equity Loan Asset
Backed Certificates, Series 1999-3, Class A-1F, Class A-2F, Class A-3F, Class
A-4F, Class A-5F, Class A-6F, Class A-7F, Class A-1A, Class X, Class R-I, Class
R-II, Class R-III and Class R-IV (collectively, the "CERTIFICATES"), we hereby
authorize and request you to establish an account, as a Principal and Interest
Account pursuant to SECTION 5.03 of the Agreement, in the name of U.S. Bank
National Association and to be titled "EQCC Home Equity Loan Trust, Series
1999-3 Principal and Interest Account". The Principal and Interest Account shall
bear an additional designation clearly indicating that the funds deposited
therein are held for the Trustee for the benefit of the holders of the
Certificates. All deposits in the account shall be subject to withdrawal
therefrom by order signed by the Servicer. You may refuse any deposit which
would result in violation of the requirement that the account be fully insured
as described below. This letter is submitted to you in duplicate. Please execute
and return one original to us.
[SERVICER]
By:____________________________________
Name:
Title:
The undersigned, as Account Depository, hereby certifies that the
above described account has been established under Account Number ___________,
at the office of the depository indicated above, and agrees to honor withdrawals
on such account as provided above. The amounts deposited at any time in the
account will be insured to the maximum amount provided by applicable law by the
Bank Insurance Fund or the Savings Association Insurance Fund of the Federal
Deposit Insurance Corporation.
(Name of Account Depository)
By:____________________________________
Name:
Title:
<PAGE>
EXHIBIT Q
FORM OF NOTICE TO CERTIFICATE INSURER
TO: Ambac Assurance Corporation
One State Street Plaza
New York, New York 10004
Attention: General Counsel
Telephone: (212) 668-0340
Telecopier: (212) 363-1459
RE: EQCC Home Equity Loan Asset Backed Certificates, Series 1999-3, Class A-1F,
Class A-2F, CLASS A-3F, CLASS A-4F, CLASS A-5F, CLASS A-6F, CLASS A-7F AND
CLASS A-1A
Policy No. __________
Determination Date:
Distribution Date:
We refer to that certain Pooling and Servicing Agreement, dated as of August 1,
1999, among EquiCredit Corporation of America, the Depositors listed therein and
U.S. Bank National Association, as trustee, relating to EQCC Home Equity Loan
Asset Backed Certificates, Series 1999-3, Class A-1F, Class A-2F, Class A-3F,
Class A-4F, Class A-5F, Class A-6F, Class A-7F, Class A-1A, Class X, Class R-I,
Class R-II, Class R-III and Class R-IV (the "POOLING AND SERVICING AGREEMENT");
all capitalized terms not otherwise defined herein shall have the same
respective meanings as set forth in such Pooling and Servicing Agreement.
[As of the Determination Date, the Trustee has determined that an Event of
Nonpayment has occurred under the Pooling and Servicing Agreement and hereby
certifies that in respect of the related Distribution Date:
(i) The amount remitted by the Servicer pursuant to SECTIONS 5.04(I), 6.04(E)
and 6.08 of the Pooling and Servicing Agreement and on deposit in the
Collection Account is
$_____________).
(ii) The Class A Interest Remittance Amount is $__________.
(iii) The amount to be withdrawn from the Collection Account for deposit into
the Insurance Account or otherwise pursuant to priority first of SECTIONS
6.05(D)(I), 605(D)(II) and 605(D)(III) of the Pooling and Servicing
Agreement is $___________.
(iv) The amount that has been deposited in the Collection Account but may not
be withdrawn therefrom pursuant to an order of a United States bankruptcy
court of competent jurisdiction imposing a stay pursuant to Section 362 of
the United States Bankruptcy Code and would otherwise have constituted all
or a portion of the amount described in item (ii) above is
$_______________.
(v) The excess of (x) the amount stated in item (ii) above plus the amount
stated in item (iii) above, over (y) the amount stated in item (i) above
less the amount stated in item (iv) above is $_________________.
(vi) Monthly installments of principal and interest on the Mortgage Loans that
were due during the Due Period related to this Distribution Date and were
not received prior to this Distribution Date equal $_____________.
(vii) In accordance with the above and the Pooling and Servicing Agreement, the
Insured Payment is $_________________.
Accordingly, pursuant to SECTION 6.05 of the Pooling and Servicing Agreement,
this statement constitutes a claim for an Insured Payment in the amount of
$__________ under the Insurance Policy.]
[As of the Determination Date, the Trustee has determined that an Insured
Payment is due and hereby certifies that in respect of the related Distribution
Date:
(i) The aggregate of the Certificate Balances of each Certificate Group then
outstanding (after giving effect to principal distributions to be made
pursuant to SECTION 6.05(d) on such Distribution Date) is
$_________________.
(ii) The aggregate Principal Balance of the Mortgage Loans then outstanding is
$_______________.
(iii) The excess of the amount stated in item (i) above over the amount stated
in item (ii) above is $_________________.
(iv) In accordance with the above and the Pooling and Servicing Agreement, the
Insured Payment is $_________________.
Accordingly, pursuant to SECTION 6.05 of the Pooling and Servicing Agreement,
this statement constitutes a claim for an Insured Payment in the amount of
$__________ under the Insurance Policy.]
[As of the Determination Date, the Trustee has determined that an Insured
Payment is due and hereby certifies that in respect of the related Distribution
Date:
(i) _______________ is the Final Scheduled Distribution Date for the Class__
Certificates.
(ii) The Certificate Balance of the Class ___ Certificates, to the extent
unpaid as of the date stated in item (i) above (after giving effect to
principal distributions to be made on such Distribution Date), is
$___________________.
(iii) In accordance with the above and the Pooling and Servicing Agreement, the
Insured Payment is $_________________.
Accordingly, pursuant to SECTION 6.05 of the Pooling and Servicing Agreement,
this statement constitutes a claim for an Insured Payment in the amount of
$__________ under the Insurance Policy.]
[As of the Determination Date, the Trustee has determined that an Insured
Payment is due and hereby certifies that in respect of the related Distribution
Date:
(i) _______________ is the date fixed for termination of the Trust pursuant to
SECTION 11.01 of the Pooling and Servicing Agreement.
(ii) The aggregate Certificate Balances of each Class of Class A Certificates,
to the extent unpaid as of the date stated in item (i) above (after giving
effect to principal distributions to be made on such Distribution Date),
is
$___________________.
(iii) In accordance with the above and the Pooling and Servicing Agreement, the
Insured Payment is $_________________.
Accordingly, pursuant to SECTION 6.05 of the Pooling and Servicing Agreement,
this statement constitutes a claim for an Insured Payment in the amount of
$__________ under the Insurance Policy.]
[As of the Determination Date, the Trustee has determined that a Preference
Amount exists under the Pooling and Servicing Agreement and hereby certifies
that in respect of the related Distribution Date:
(i) The amounts previously distributed to the Class A Certificateholders that
is recoverable as a voidable preference in bankruptcy pursuant to the
United States Bankruptcy Code in accordance with a final nonappealable
order of a court having competent jurisdiction is $_________________.
(ii) In accordance with the above and the Pooling and Servicing Agreement, the
Insured Payment is $_________________.
Accordingly, pursuant to SECTION 6.05 of the Pooling and Servicing Agreement,
this statement constitutes a claim for an Insured Payment in the amount of
$__________ under the Insurance Policy.
Attached hereto is a certified copy of the court order requiring the return of
the preference payment.]
ANY PERSON WHO KNOWINGLY AND WITH INTENT TO DEFRAUD ANY INSURANCE COMPANY OR
OTHER PERSON FILES AN APPLICATION FOR INSURANCE OR STATEMENT OF CLAIM CONTAINING
ANY MATERIALLY FALSE INFORMATION, OR CONCEALS FOR THE PURPOSE OF MISLEADING,
INFORMATION CONCERNING ANY FACT MATERIAL THERETO, COMMITS A FRAUDULENT INSURANCE
ACT, WHICH IS A CRIME, AND SHALL ALSO BE SUBJECT TO A CIVIL PENALTY NOT TO
EXCEED FIVE THOUSAND ($5,000.00) DOLLARS AND THE STATED VALUE OF THE CLAIM FOR
EACH SUCH VIOLATION.
The amount claimed should be paid as follows:
_____________________________
_____________________________
___________, as Trustee
By: _________________________
Name:________________________
Title:_______________________
Telephone #:_________________
For Ambac Assurance Corporation Use Only
Wire Transfer Sent On:
By:___________________________
Confirmation Number:
<PAGE>
EXHIBIT R
MONTHLY INFORMATION DELIVERED BY SERVICER
1. With respect to the Mortgage Pool and each Mortgage Loan Group, the number
and Principal Balances of all Mortgage Loans which were the subject of
Principal Prepayments during the related Due Period.
2. With respect to the Mortgage Pool and each Mortgage Loan Group, the amount
of all Curtailments which were received during the related Due Period.
3. With respect to the Mortgage Pool and each Mortgage Loan Group, the
aggregate amount of principal portion of all Monthly Payments received
during the related Due Period.
4. With respect to the Mortgage Pool and each Mortgage Loan Group, the amount
of interest received on the Mortgage Loans during the related Due Period.
5. With respect to the Mortgage Pool and each Mortgage Loan Group, the
aggregate amount of the Advances made and recovered with respect to such
Distribution Date.
6. With respect to the Mortgage Pool and each Mortgage Loan Group, the
delinquency and foreclosure information set forth in EXHIBIT H to the
Pooling and Servicing Agreement and the amount of Mortgage Loan Losses
during the related Due Period.
7. With respect to the Mortgage Pool and each Mortgage Loan Group, the
weighted average maturity, the weighted average Mortgage Interest Rate and
the weighted average Net Mortgage Interest Rate as of the last day of the
Due Period preceding of the related Accrual Period.
8. The Servicing Fees paid and Servicing Fees accrued during the related Due
Period.
9. The amount of all payments or reimbursements to the Servicer pursuant to
SECTION 5.04 (II), (IV), (V), (VI) AND (VII) paid or to be paid since the
prior Distribution Date (or in the case of the first Distribution Date,
since the Closing Date).
10. The Pool Principal Balance and aggregate Principal Balance for each
Mortgage Loan Group.
11. Such other information as the Certificate Insurer, each Account Party and
the Certificateholders may reasonably require.
12. The amounts which are reimbursable to the Servicer, the Representative or
the Depositors, as appropriate, pursuant to SECTION 6.05.
13. With respect to the Mortgage Pool and each Mortgage Loan Group, the number
of Mortgage Loans outstanding at the beginning and at the end of the
related Due Period.
14. The aggregate interest accrued on the Mortgage Loans at their respective
Mortgage Interest Rates for the related Due Period.
15. The amount deposited in the Collection Account which may not be withdrawn
therefrom pursuant to an Order of a United States Bankruptcy Court of
competent jurisdiction imposing a stay pursuant to Section 362 of U.S.
Bankruptcy Code.
16. The Principal Balance of Mortgage Loans in Fixed Rate Group 1 and Fixed
Rate Group 2 with Mortgage Interest Rates less than [ ]% and [ ]% per
annum, respectively.
17. The aggregate Mortgage Loan Losses since the Cut-off Date as of the end of
the related Due Period.
18. The Fixed Rate Interest Carryover for each Class of Fixed Rate
Certificates and the Class A-1A LIBOR Interest Carryover, if any, with
respect to such Distribution Date.
19. The Overcollateralized Amount, the Overcollateralization Target Amount and
any Overcollateralization Deficiency Amount for each Certificate Group, in
each case after giving effect to distributions on such Distribution Date.
<PAGE>
EXHIBIT S
LIST OF DELINQUENT LOANS
<PAGE>
EXHIBIT T
SCHEDULE OF MORTGAGE LOANS SUBJECT TO
THE HOME OWNERSHIP AND EQUITY PROTECTION ACT OF 1994
NOTICE: EACH MORTGAGE LOAN LISTED ON THIS MORTGAGE LOAN SCHEDULE IS SUBJECT TO
SPECIAL RULES UNDER THE FEDERAL TRUTH IN LENDING ACT. PURCHASERS OR ASSIGNEES OF
A MORTGAGE LOAN LISTED ON THIS MORTGAGE LOAN SCHEDULE COULD BE LIABLE FOR ALL
CLAIMS AND DEFENSES WITH RESPECT TO SUCH MORTGAGE LOAN THAT THE RELATED
MORTGAGOR COULD ASSERT AGAINST THE ORIGINAL LENDER.
<PAGE>
EXHIBIT U
LOST NOTE AND/OR MORTGAGE/DEED OF TRUST AFFIDAVIT
State of ____________________ Account #_______________
County of ___________________
TO WIT:
Comes the affiant, _____________________________________________ (Name/Title) of
_________________________________________________________________________, after
being duly sworn by me, ___________________________________________________, and
in my presence, a Notary Public in and for the county and state aforesaid states
that ___________________________________________________________________________
is the Noteholder or lien creditor, under a certain Mortgage/Deed of Trust from
___________________________________ to _____________________________________,
dated _______________________ and recorded in the Clerk's Office of the Circuit
Court of the County of ____________________, State of ____________________ in
Deed Book No. _________________ at Page _____________, as Instrument Number
__________________ to secure $ _______________, and that said _____________ Note
__________ Mortgage evidencing the debt has been inadvertently lost or destroyed
and cannot be produced.
[ENTITY]
By:____________________________________
Name:
Title:
State of ____________________
County of ___________________
The foregoing instrument was acknowledged before me this __________ day of
________________, 19__ By________________________________________.
__________________________________________
Notary Public
<PAGE>
EXHIBIT V
SCHEDULE OF MORTGAGE LOANS THAT DO NOT
HAVE TITLE INSURANCE POLICIES
NO MORTGAGE LOANS WITHOUT TITLE INSURANCE AS OF THE CLOSING DATE
<PAGE>
EXHIBIT Y
REO RESALES
AMBAC ASSURANCE CORPORATION
c/o CT Corporation Systems
44 East Mifflin Street
Madison, Wisconsin 53703
Administrative Office:
One State Street Plaza
New York, New York 10004
Telephone: (212) 668-0340
SURETY BOND
ISSUER: EQCC Home Equity Loan Trust 1999-3 POLICY NUMBER: AB0285BE
INSURED OBLIGATIONS: $1,000,000,000
aggregate principal amount of EQCC
Home Equity Loan Asset Backed
Certificates, Series 1999-3, Class A
(the "Certificates")
TRUSTEE: U.S. Bank National Association
Ambac Assurance Corporation ("Ambac"), a Wisconsin stock insurance corporation,
in consideration of its receipt of the Deposit Premium and the Monthly Premium
and subject to the terms of this Surety Bond, hereby unconditionally and
irrevocably agrees to pay each Insured Payment to the Trustee named above or its
successor, as trustee for the Certificateholders, to the extent set forth in the
Pooling and Servicing Agreement, dated as of August 1, 1999, by and among EQCC
Receivables Corporation and EQCC Asset Backed Corporation, as Depositors,
EquiCredit Corporation of America, as Representative and Servicer and U.S. Bank
National Association, as Trustee (the "Pooling and Servicing Agreement").
Ambac will make Insured Payments (other than Preference Amounts) out of its own
funds by 12:00 noon (New York City time) in immediately available funds to the
Trustee on the later of (i) the Business Day next following the day on which
Ambac shall have received Notice that an Insured Payment is due and (ii) the
Payment Date on which the Insured Payment is distributable to Certificateholders
pursuant to the Pooling and Servicing Agreement, for disbursement to
Certificateholders in the same manner as other payments with respect to the
Certificates are required to be made. Any Notice received by Ambac after 12:00
noon New York City time on a given Business Day or on any day that is not a
Business Day shall be deemed to have been received by Ambac on the next
succeeding Business Day.
Ambac shall make Insured Payments which are Preference Amounts out of its own
funds by 12:00 noon (New York City time) in immediately available funds to the
Trustee on the later of (a) the Business Day next following the day on which
Ambac shall have received (i) a certified copy of a final, non-appealable order
of a court or other body exercising jurisdiction in such insolvency proceeding
to the effect that the Trustee or the Certificateholder, as applicable, is
required to return such Preference Amount paid during the term of this Surety
Bond because such payments were avoided as a preferential transfer or otherwise
rescinded or required to be restored by the Trustee or the Certificateholder, as
applicable (the "Order"), (ii) a certificate by or on behalf of the Trustee that
the Order has been entered and is not subject to any stay, (iii) an assignment,
in form and substance satisfactory to Ambac, duly executed and delivered by the
Trustee, irrevocably assigning to Ambac all rights and claims of the Trustee or
the Certificateholder, as applicable, relating to or arising under the Pooling
and Servicing Agreement against the estate of the bankruptcy trustee or
otherwise with respect to such Preference Amount and (iv) a Notice appropriately
completed and executed by the Trustee, and (b) the date due pursuant to the
Order. Such payment shall be disbursed to the receiver, conservator,
debtor-in-possession or trustee in bankruptcy named in the Order, and not to the
Trustee or the Certificateholder, as applicable, directly, unless the Trustee or
the Certificateholder, as applicable, has made a payment of the Preference
Amount to the court or such receiver, conservator, debtor-in-possession or
trustee in bankruptcy named in the Order, in which case Ambac will pay the
Trustee on behalf of the Certificateholders, subject to the delivery of (a) the
items referred to in clauses (i), (ii), (iii) and (iv) above to Ambac and (b)
evidence satisfactory to Ambac that payment has been made to such court or
receiver, conservator, debtor-in-possession or trustee in bankruptcy named in
the Order.
Upon such payment, Ambac shall be fully subrogated to the rights of the
Certificateholders to receive the amount so paid. Ambac's obligations hereunder
with respect to each Payment Date shall be discharged to the extent funds
consisting of the Insured Payment are received by the Trustee on behalf of the
Certificateholders for distribution to such Certificateholders, as provided in
the Pooling and Servicing Agreement and herein, whether or not such funds are
properly applied by the Trustee. This Surety Bond is non-cancelable for any
reason, including nonpayment of any premium. The premium on this Surety Bond is
not refundable for any reason, including the payment of the Certificates prior
to their respective maturities. This Surety Bond shall expire and terminate
without any action on the part of Ambac or any other Person on the date that is
one year and one day following the date on which the Certificates shall have
been paid in full.
The "Deposit Premium" shall be due and payable on the date hereof, as provided
in a letter agreement of even date herewith among Ambac and the Depositors, and
a monthly premium shall be due and payable as provided in the Pooling and
Servicing Agreement.
This Surety Bond is subject to and shall be governed by the laws of the State of
New York. The insurance provided by this Surety Bond is not covered by the New
York Property/Casualty Insurance Security Fund (New York Insurance Law, Article
76).
Capitalized terms used and not defined herein shall have respective meanings set
forth in the Pooling and Servicing Agreement. "Notice" means written notice in
the form of Exhibit Q to the Pooling and Servicing Agreement by registered or
certified mail or telephonic or telegraphic notice, subsequently confirmed by
written notice delivered via telecopy, telex or hand delivery from the Trustee
to Ambac specifying the information set forth therein. "Certificateholder"
means, as to a particular Certificate, the person, other than the Trust, the
Servicer, any Subservicer or the Representative or any Depositor who, on the
applicable Payment Date, is entitled under the terms of such Certificate to
payment thereof. "Preference Amount" means any payment of Insured Amounts on a
Certificate which has become due and which is made to a Certificateholder by or
on behalf of the Trustee which has been deemed a preferential transfer and
theretofore recovered from the Certificateholder or Trustee pursuant to the
United States Bankruptcy Code in accordance with a final, nonappealable order of
a court of competent jurisdiction.
In the event that payments under any Certificate are accelerated, nothing herein
contained shall obligate Ambac to make any payment of principal or interest on
such Certificates on an accelerated basis, unless such acceleration of payment
by Ambac is at the sole option of Ambac.
IN WITNESS WHEREOF, Ambac has caused this Surety Bond to be signed by its duly
authorized officer to become effective and binding upon Ambac by virtue of the
countersignature of its duly authorized representative.
- ---------------------------------- --------------------------------------
Assistant Secretary First Vice President
Effective Date: August 26, 1999
