SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 8-K
CURRENT REPORT
Pursuant to Section 13 or 15(d) of the
Securities Exchange Act of 1934
Date of Report (Date of Earliest event reported): December 21, 1999
MLCC Mortgage Investors, Inc.
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(Exact name of registrant as specified in its character)
Delaware
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(State or other jurisdiction of incorporation or organization)
333-14253 59-3247986
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(Commission File Number) (IRS Employer Identification No.)
MLCC Mortgage Investors, Inc.
4802 Deer Lake Drive East
Jacksonville, FL 32246
Attention: General Counsel
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(Address of principal executive offices and zip code)
Registrant's telephone number, including area code: 904-928-6000
Not applicable
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(Former name or former address, if changed since last report)
Item 5. Other Events.
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Filing of Pooling and Servicing Agreement
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On December 21, 1999 MLCC Mortgage Investors, Inc. (the "Seller") entered
into a Pooling and Servicing Agreement dated as of December 1, 1999 (the
"Pooling and Servicing Agreement"), by and among the Depositor, as depositor,
Merrill Lynch Credit Corporation, as master servicer, and Bankers Trust
Company of California, N.A., as trustee (the "Trustee"). The Pooling and
Servicing Agreement is annexed hereto as Exhibit 99.
Item 7. Financial Statements and Exhibits.
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(c) Exhibits
The following is filed herewith. The exhibit number corresponds
with Item 601(b) of Regulation S-K.
Exhibit No. Description
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99 Pooling and Servicing Agreement
SIGNATURES
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Pursuant to the requirements of the Securities Exchange Act of 1934, the
Registrant has duly caused this report to be signed on its behalf by the
undersigned hereunto duly authorized.
MLCC MORTGAGE INVESTORS, INC.
By: /s/ Laurel A. Davis
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Laurel A. Davis
Its: Vice President and
Assistant Secretary
Dated: January 5, 2000
EXHIBIT INDEX
Exhibit No. Page
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99 6
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EXECUTION COPY
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MLCC MORTGAGE INVESTORS, INC.,
COMPANY,
MERRILL LYNCH CREDIT CORPORATION,
MASTER SERVICER,
and
BANKERS TRUST COMPANY OF CALIFORNIA, N.A.,
TRUSTEE
POOLING AND SERVICING AGREEMENT
Dated as of December 1, 1999
$700,000,000
Mortgage Loan Asset Backed Pass-Through Certificates
Series 1999-A
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<PAGE>
TABLE OF CONTENTS
Page
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ARTICLE I
DEFINITIONS
Section 1.01. Definitions............................................1
Section 1.02. Interest Calculations.................................27
ARTICLE II
CONVEYANCE OF MORTGAGE LOANS; TRUST FUND
Section 2.01. Conveyance of Mortgage Loans..........................28
Section 2.02. Acceptance by Trustee.................................31
Section 2.03. Sale and Conveyance of the Subsequent Mortgage Loans..32
Section 2.04. Trust Fund; Authentication of Certificates............35
Section 2.05. REMIC Elections.......................................35
Section 2.06. REMIC Tax Matters.....................................36
Section 2.07. REMIC Certificate Maturity Date.......................36
Section 2.08. Lower-Tier REMIC......................................36
ARTICLE III
REPRESENTATIONS AND WARRANTIES OF THE MASTER SERVICER;
REPURCHASE OF MORTGAGE LOANS;
REPRESENTATION AND WARRANTY OF THE COMPANY
Section 3.01. Representations and Warranties of the Master Servicer.37
Section 3.02. Option to Substitute..................................47
Section 3.03. Representation and Warranty of the Company............48
Section 3.04. Index Convertible Mortgage Loans and Convertible
Mortgage Loans; Certain Procedures and Purchases......48
ARTICLE IV
THE CERTIFICATES
Section 4.01. The Certificates......................................50
Section 4.02. Registration of Transfer and Exchange of Certificates.51
Section 4.03. Mutilated, Destroyed, Lost or Stolen Certificates.....55
Section 4.04. Persons Deemed Owners.................................55
Section 4.05. Appointment of Paying Agent...........................55
ARTICLE V
ADMINISTRATION AND SERVICING OF MORTGAGE LOANS
Section 5.01. Master Servicer to Service Mortgage Loans.............57
Section 5.02. Sub-Servicing Agreements Between Master Servicer
and Sub-Servicers; Enforcement of Sub-Servicer's
Obligations...........................................58
Section 5.03. Successor Sub-Servicers...............................59
Section 5.04. Liability of the Master Servicer......................59
Section 5.05. No Contractual Relationship Between Sub-Servicer
and Trustee, the Certificateholders, the Certificate
Insurer or the Surety.................................59
Section 5.06. [Reserved]............................................60
Section 5.07. Collection of Mortgage Loan Payments..................60
Section 5.08. Establishment of Certificate Account; Deposits in
Certificate Account...................................60
Section 5.09. Permitted Withdrawals from the Certificate Account....62
Section 5.10. Establishment of Escrow Account; Deposits in Escrow
Account...............................................63
Section 5.11. Permitted Withdrawals from Escrow Account.............64
Section 5.12. Payment of Taxes, Insurance and Other Charges.........64
Section 5.13. Transfer of Accounts..................................65
Section 5.14. Establishment of Pre-Funding Account; Permitted
Withdrawals...........................................65
Section 5.15. Carryover Reserve Fund................................66
Section 5.16. Maintenance of Standard Hazard Policies...............66
Section 5.17. [Reserved]............................................67
Section 5.18. [Reserved]............................................67
Section 5.19. Fidelity Bond and Errors and Omissions Insurance......67
Section 5.20. Collections under Insurance Policies; Enforcement
of Due-on-Sale Clauses; Assumption Agreements.........67
Section 5.21. Income and Realization from Defaulted Mortgage Loans..68
Section 5.22. Custodian and Trustee to Cooperate; Release of
Mortgage Files........................................69
Section 5.23. Servicing and Other Compensation......................71
Section 5.24. File Review Rights of the Certificate Insurer and
the Surety............................................71
Section 5.25. Annual Statement as to Compliance.....................71
Section 5.26. Annual Independent Public Accountants'
Servicing Report......................................71
Section 5.27. Access to Certain Documentation; Rights of the
Company in Respect of the Master Servicer.............72
Section 5.28. REMIC-Related Covenants...............................72
Section 5.29. Prohibited Transactions and Other Taxes...............74
ARTICLE VI
PAYMENTS TO THE CERTIFICATEHOLDERS
Section 6.01. Distributions.........................................75
Section 6.02. Statements to the Certificateholders..................78
Section 6.03. Advances by the Master Servicer.......................80
Section 6.04. The Certificate Insurance Policy......................81
Section 6.05. The Certificate Guaranty Surety Bond..................82
ARTICLE VII
REPORTS TO BE PREPARED BY MASTER SERVICER
Section 7.01. Master Servicer Shall Provide Information as
Reasonably Required...................................84
Section 7.02. Federal Information Returns and Reports to
Certificateholders....................................84
ARTICLE VIII
THE COMPANY AND THE MASTER SERVICER
Section 8.01. Indemnification; Third Party Claims...................86
Section 8.02. Merger or Consolidation of the Company or the Master
Servicer; Status of Master Servicer...................87
Section 8.03. Limitation on Liability of the Company, the Master
Servicer, the Trustee and Others......................87
Section 8.04. Company and Master Servicer Not to Resign.............88
Section 8.05. Successor to the Master Servicer......................88
Section 8.06. Maintenance of Ratings................................90
ARTICLE IX
DEFAULT
Section 9.01. Events of Default.....................................91
Section 9.02. Waiver of Defaults....................................92
Section 9.03. Trustee or Company to Act; Appointment of Successor...93
Section 9.04. Notification to Certificateholders....................93
ARTICLE X
CONCERNING THE TRUSTEE
Section 10.01. Duties of Trustee.....................................94
Section 10.02. Certain Matters Affecting the Trustee.................95
Section 10.03. Trustee Not Liable for Certificates or Mortgage Loans.96
Section 10.04. Trustee May Own Certificates..........................96
Section 10.05. Master Servicer to Pay Trustee's Fees and Expenses....96
Section 10.06. Eligibility Requirements for Trustee..................96
Section 10.07. Resignation and Removal of the Trustee................97
Section 10.08. Successor Trustee.....................................98
Section 10.09. Merger or Consolidation of Trustee....................98
Section 10.10. Appointment of Co-Trustee or Separate Trustee.........99
Section 10.11. Appointment of Office or Agency......................100
ARTICLE XI
TERMINATION
Section 11.01. Termination..........................................101
Section 11.02. Additional Termination Requirements..................102
Section 11.03. Termination By Certificate Insurer or Surety.........103
ARTICLE XII
MISCELLANEOUS PROVISIONS
Section 12.01. Severability of Provisions...........................104
Section 12.02. Limitation on Rights of Certificateholders...........104
Section 12.03. Amendment............................................105
Section 12.04. The Certificate Insurer; Surety......................106
Section 12.05. Recordation of Agreement; Counterparts...............106
Section 12.06. Duration of Agreement................................107
Section 12.07. Governing Law........................................107
Section 12.08. Notices..............................................107
EXHIBITS
A. Mortgage Loan Schedule...........................................A-1
B. Contents of Mortgage File........................................B-1
C. Form of Class A Certificates.....................................C-1
D. Form of Class B Certificates.....................................D-1
E. Form of Class C Certificates.....................................E-1
F. Form of Class R Certificate ...................................F-1
G. [Reserved].......................................................G-1
H. Certificate Account Certification .............................H-1
I. [Reserved].......................................................I-1
J. Distribution Account Certification...............................J-1
K. Form of Subsequent Transfer Agreement............................K-1
L. Form of Investment Letter ............................L-1
M. Form of Transfer Affidavit ......................................M-1
N. ERISA Representation Letter......................................N-1
O. [Reserved].......................................................O-1
P. Sale Agreement...................................................P-1
Q. Form of Notice for Certificate Insurance Policy..................Q-1
R. Form of Notice for Certificate Guaranty Surety Bond..............R-1
<PAGE>
This Pooling and Servicing Agreement, dated as of December 1, 1999,
is executed among MLCC Mortgage Investors, Inc., as seller (together with its
permitted successors and assigns, the "Company"), Merrill Lynch Credit
Corporation, as master servicer (together with its permitted successors and
assigns, the "Master Servicer"), and Bankers Trust Company of California,
N.A., as trustee (together with its permitted successors and assigns, the
"Trustee").
In consideration of the premises and the mutual agreements
hereinafter set forth, the Company, the Master Servicer and the Trustee agree
as follows:
ARTICLE I
DEFINITIONS
Section 1.01. Definitions. Whenever used herein, the following words
and phrases, unless the context otherwise requires, shall have the following
meanings:
ACCRUAL PERIOD: As to any Distribution Date other than the First
Distribution Date, the actual number of days included in the period beginning
on the preceding Distribution Date and ending on the day preceding such
Distribution Date. In the case of the First Distribution Date, the actual
number of days included in the period beginning on December 21, 1999 and
ending on the day preceding the First Distribution Date.
ADDITION NOTICE: With respect to the transfer of Subsequent Mortgage
Loans to the Trustee pursuant to Section 2.03 hereof and the related
Subsequent Transfer Agreement, a notice, which the Master Servicer shall give
to the Trustee and the Certificate Insurer not later than three Business Days
prior to the related Subsequent Transfer Date, of (a) the Company's
designation of Subsequent Mortgage Loans to be conveyed to the Trustee, on
behalf of and for inclusion in the Trust Fund, and (b) the aggregate Principal
Balance of such Subsequent Mortgage Loans as of the related Subsequent Cut-off
Date.
ADDITIONAL COLLATERAL: (i) With respect to any Mortgage 100(sm) Loan,
the marketable securities subject to a security interest pursuant to the
related Mortgage 100(sm) Pledge Agreement, or (ii) with respect to any Parent
Power(R) Mortgage Loan, the related Parent Power(R) Agreement.
ADDITIONAL COLLATERAL MORTGAGE LOAN: Each Mortgage Loan that is
either a Mortgage 100(sm) Loan or Parent Power(R) Mortgage Loan as to which the
Additional Collateral is still required to be provided as set forth in the
related Mortgage 100(sm) Pledge Agreement or Parent Power(R) Agreement.
ADDITIONAL COLLATERAL MORTGAGE LOAN LIQUIDATION SHORTFALL: The
amount, if any, by which the then outstanding principal balance of a defaulted
Additional Collateral Mortgage Loan exceeds the Liquidation Proceeds
(including those from the related Additional Collateral) allocable to
principal realized with respect to such Mortgage Loan.
ADVANCE: The aggregate of the advances made by the Master Servicer or
the Trustee with respect to a particular Distribution Date pursuant to Section
6.03.
ADVANCE DEPOSIT DATE: As to any Distribution Date, the Business Day
preceding such Distribution Date.
AFFILIATE: With respect to any Person, any other Person controlling,
controlled by or under common control with such Person. For purposes of this
definition, "control" means the power to direct the management and policies of
a Person, directly or indirectly, whether through ownership of voting
securities, by contract or otherwise, and "controlling" and "controlled" shall
have meanings correlative to the foregoing.
AGGREGATE NET PRINCIPAL LIQUIDATION LOSSES: With respect to each
Distribution Date, the amount, if any, by which (a) the aggregate of the
outstanding principal balances of those Mortgage Loans that became Liquidated
Mortgage Loans during the month ending prior to the month of such Distribution
Date exceeds (b) the aggregate Net Liquidation Proceeds for such Mortgage
Loans that are allocable to principal in accordance with the terms thereof.
AGREEMENT: This Pooling and Servicing Agreement and all amendments
hereof and exhibits and supplements hereto.
ALTERNATE CERTIFICATE RATE: As to any Distribution Date, the weighted
average of the Net Mortgage Rates of all Mortgage Loans applicable as of the
Due Date of the month preceding the month of such Distribution Date, weighted
on the basis of their outstanding Principal Balances (after giving effect to
the Monthly Payments due on or before such Due Date and Principal Prepayments
received prior to such Due Date) at such time.
APPRAISED VALUE: As to any Mortgaged Property and any time referred
to herein, the appraised value of such Mortgaged Property based upon the
appraisal made by or on behalf of the Mortgage Loan Seller or the Master
Servicer at such time.
ASSIGNMENT OF MORTGAGE: An assignment of the Mortgage, notice of
transfer or equivalent instrument, in recordable form, sufficient under the
laws of the jurisdiction where the related Mortgaged Property is located to
reflect of record the sale and assignment of the Mortgage Loan to the Trustee,
which assignment, notice of transfer or equivalent instrument may, if
permitted by law, be in the form of one or more blanket assignments covering
Mortgages secured by Mortgaged Properties located in the same county.
AVAILABLE DISTRIBUTION AMOUNT: With respect to any Distribution Date,
an amount equal to the amount on deposit in the Certificate Account as of the
close of business on the related Determination Date, plus Advances and other
amounts deposited to the Distribution Account pursuant to Section 6.03,
except:
(a) previously unreimbursed amounts received on particular
Mortgage Loans as late payments or other recoveries of principal or
interest (including Liquidation Proceeds, Insurance Proceeds and
condemnation awards) that were part of a prior Advance;
(b) amounts representing the reimbursement for
Nonrecoverable Advances and other amounts (including the Servicing
Fee) permitted to be withdrawn by the Master Servicer from, or not
required to be deposited in, the Certificate Account pursuant to
Section 5.09;
(c) amounts representing all or part of a Monthly Payment
due after the immediately preceding Due Date;
(d) all Repurchase Proceeds, Principal Prepayments,
Liquidation Proceeds, Insurance Proceeds and condemnation awards with
respect to the Mortgage Loans received after the related Principal
Prepayment Period, and all related payments of interest representing
interest for any period of time after the last day of the related Due
Period for such Mortgage Loans; and
(e) all income from Eligible Investments held in the
Certificate Account for the account of the Master Servicer.
BASIS RISK CARRYOVER AMOUNT: As to any Distribution Date on which the
Class A Pass-Through Rate or the Class B Pass-Through Rate is calculated based
on the Alternate Certificate Rate, the excess of:
(1) the amount of interest that the Class A Certificates or
Class B Certificates would have been entitled to receive on such
Distribution Date (but not in excess of 11.86% per annum) had the
Class A Pass-Through Rate or the Class B Pass-Through Rate not been
calculated based on the Alternate Certificate Rate, over
(2) the amount of interest that the Class A Certificates and
Class B Certificates would receive on such Distribution Date based on
the Alternate Certificate Rate (but not in excess of 11.86% per
annum),
together with any Unpaid Basis Risk Carryover Amount for the immediately
preceding Distribution Date, plus interest thereon at the then applicable
Class A Pass-Through Rate or the Class B Pass-Through Rate (without giving
effect to the Alternate Certificate Rate, but not in excess of 11.86% per
annum) to the extent not previously reimbursed from amounts withdrawn from the
Carryover Reserve Fund.
BOOK-ENTRY CERTIFICATE: Any Class A Certificate registered in the
name of the Depository or its nominee ownership of which is reflected on the
books of the Depository or on the books of a person maintaining an account
with such Depository (directly or as an indirect participant in accordance
with the rules of such Depository).
BUSINESS DAY: Any day other than (a) a Saturday or Sunday, or (b) a
legal holiday in the State of Florida or the State of New York, or (c) a day
on which banking or savings and loan institutions in the State of Florida, the
State of New York or the State in which the Corporate Trust Office is located
are authorized or obligated by law or executive order to be closed.
CARRYOVER RESERVE FUND: The account created and initially maintained
by the Trustee pursuant to Section 5.15. Amounts on deposit in the Carryover
Reserve Fund shall be held in trust for the Class A and Class B
Certificateholders for the uses and purposes set forth in this Agreement.
CARRYOVER RESERVE FUND DEPOSIT: As to any Distribution Date, the
greater of (i) any Basis Risk Carryover Amount for such date, and (ii) an
amount such that when added to any other amounts already on deposit in the
Carryover Reserve Fund, the aggregate amount on deposit therein will be equal
to $10,000 (before taking into account any withdrawals from the Carryover
Reserve Fund on such date).
CERTIFICATE: Any Class A, Class B, Class C or Class R Certificate.
CERTIFICATE ACCOUNT: The account created and maintained pursuant to
Section 5.08.
CERTIFICATE GUARANTY SURETY BOND: The Limited Purpose Surety Bond No.
AB0039BE dated February 28, 1996 issued by the Surety.
CERTIFICATEHOLDER or HOLDER: The person in whose name a Certificate
is registered in the Certificate Register, except that, solely for the
purposes of giving any consent, waiver, request or demand pursuant to this
Agreement, any Certificate registered in the name of the Company, the Master
Servicer, any Sub-Servicer, or any of their respective Affiliates 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
amount of Percentage Interests necessary to effect any such consent, waiver,
request or demand has been obtained, unless such Person owns the entire Class
of which such Certificate is a part. The Trustee shall be provided with an
Officer's Certificate by the Company, the Master Servicer or any Sub-Servicer
if any Certificate is owned by any Affiliate thereof and shall be entitled to
conclusively rely upon the certificate of the Company or the Master Servicer
or any Sub-Servicer as to the determination of the aggregate Percentage
Interests evidenced by Certificates registered to the Company, the Master
Servicer, any Sub-Servicer or their Affiliates.
CERTIFICATE INSURANCE POLICY: The certificate guaranty insurance
policy (# AB0327BE) dated the Closing Date issued by the Certificate Insurer
to the Trustee for the benefit of the Holders of the Class A Certificates.
CERTIFICATE INSURER: Ambac Assurance Corporation, or any successor
thereto, as issuer of the Certificate Insurance Policy.
CERTIFICATE OWNER: With respect to a Class A Certificate that is a
Book-Entry Certificate, the person who is the beneficial owner of a Book-Entry
Certificate.
CERTIFICATE REGISTER: The register maintained pursuant to Section
4.02.
CLASS: All Certificates bearing the same class designation.
CLASS A, CLASS B, CLASS C or CLASS R: Pertaining to Class A, Class B,
Class C or Class R Certificates, as the case may be.
CLASS A CERTIFICATE: Any one of the Certificates designated as a
Class A Certificate substantially in the form set forth in Exhibit C hereto
and executed by the Company and authenticated by the Trustee.
CLASS A DISTRIBUTION AMOUNT: As to any Distribution Date, the
aggregate amount distributed on the Class A Certificates pursuant to Section
6.01.
CLASS A FORMULA PRINCIPAL DISTRIBUTION AMOUNT: With respect to any
Distribution Date, the sum of (i) the Class A Percentage of the Scheduled
Formula Principal Distribution Amount and (ii) the Class A Prepayment
Percentage of the Unscheduled Formula Principal Distribution Amount.
CLASS A INTEREST FORMULA DISTRIBUTION AMOUNT: As to any Distribution
Date, an amount equal to the sum of (a) interest for the related Accrual
Period at the Class A Pass-Through Rate on the Class A Principal Balance as of
such Distribution Date (before giving effect to the distribution on such
Distribution Date), net of Net Interest Shortfall, if any, allocated to the
Class A Certificates pursuant to Section 6.01 in respect of such Distribution
Date, (b) any Class A Unpaid Interest Shortfall for such Distribution Date,
and (c) any Basis Risk Carryover Amount allocated to the Class A Certificates
pursuant to Section 5.15 in respect of such Distribution Date.
CLASS A INTEREST SHORTFALL: As to any Distribution Date, the amount
equal to (a) the Class A Interest Formula Distribution Amount for such
Distribution Date (except for any Basis Risk Carryover Amount allocated to the
Class A Certificates on such Distribution Date), less (b) the amount of
interest distributed to the Class A Certificateholders on such Distribution
Date, less the amount of any Basis Risk Carryover Amount actually distributed
from the Carryover Reserve Fund to the Class A Certificates on such
Distribution Date.
CLASS A PASS-THROUGH RATE: As to any Distribution Date, the per annum
rate equal to the lesser of (i) LIBOR plus 0.38% (or, as to any Distribution
Date occurring at least 120 days after the first Distribution Date in respect
of which the option to purchase the Mortgage Loans in Section 11.01(ii) may
first be exercised, LIBOR plus 0.76%), (ii) the Alternate Certificate Rate,
and (iii) 11.86% per annum.
CLASS A PERCENTAGE: As to any Distribution Date, the percentage
(which shall in no event be greater than 100%) derived from dividing the Class
A Principal Balance (before giving effect to the distributions for such
Distribution Date) by the Pool Principal Balance (before giving effect to the
Formula Principal Distribution Amount for such Distribution Date).
CLASS A PREPAYMENT PERCENTAGE: The Class A Prepayment Percentage for
a Distribution Date on or before the Distribution Date in December 2009 will
be 100%. The Class A Prepayment Percentage for a Distribution Date after the
Distribution Date in December 2009 will be as follows: for any Distribution
Date subsequent to December 2009 to and including the Distribution Date in
December 2010, the Class A Percentage for such Distribution Date plus 70% of
the Subordinated Percentage for such Distribution Date; for any Distribution
Date subsequent to December 2010 to and including the Distribution Date in
December 2011, the Class A Percentage for such Distribution Date plus 60% of
the Subordinated Percentage for such Distribution Date; for any Distribution
Date subsequent to December 2011 to and including the Distribution Date in
December 2012, the Class A Percentage for such Distribution Date plus 40% of
the Subordinated Percentage for such Distribution Date; for any Distribution
Date subsequent to December 2012 to and including the Distribution Date in
December 2013, the Class A Percentage for such Distribution Date plus 20% of
the Subordinated Percentage for such Distribution Date; for any Distribution
Date thereafter, the Class A Percentage for such Distribution Date (unless on
any of the foregoing Distribution Dates the Class A Percentage exceeds the
initial Class A Percentage, in which case the Class A Prepayment Percentage
for such Distribution Date will once again be 100%).
Notwithstanding the foregoing, a decrease in the Class A Prepayment
Percentage provided for in the preceding paragraph will not occur if, as of
the first Distribution Date to which such decrease would apply in accordance
with the preceding paragraph, the following criteria are not satisfied: (a)
cumulative Unrecovered Principal Amounts shall not exceed (1) if such
Distribution Date is in the period after December 2009 to and including
December 2010, 35% of the Original Class B Principal Balance, (2) if such
Distribution Date is in the period after December 2010 to and including
December 2011, 40% of the Original Class B Principal Balance, (3) if such
Distribution Date is in the period after December 2011 to and including
December 2012, 45% of the Original Class B Principal Balance and (4) if such
Distribution Date is in the period after December 2012 to and including
December 2013, 50% of the Original Class B Principal Balance; and (b) over the
prior three months, the average aggregate outstanding Principal Balance of the
Mortgage Loans delinquent 60 days or more (including for this purpose any
Mortgage Loans in foreclosure and Mortgage Loans with respect to which the
related Mortgaged Property has been acquired by the Trust Fund) has not
exceeded 3.00% of the average aggregate outstanding Principal Balance of all
Mortgage Loans for such period.
Notwithstanding the foregoing, if on any Distribution Date (i) the
Current Subordination Level equals at least twice the Original Subordination
Level, (ii) cumulative Unrecovered Principal Amounts with respect to the
Mortgage Loans have not exceeded (1) if such Distribution Date is on or before
the fifth anniversary of the First Distribution Date, 35% of the Original
Class B Principal Balance, (2) if such Distribution Date is after the fifth
but on or before the sixth anniversary of the First Distribution Date, 40% of
the Original Class B Principal Balance, (3) if such Distribution Date is after
the sixth but on or before the seventh anniversary date of the First
Distribution Date, 45% of the Original Class B Principal Balance and (4) if
such Distribution Date is after the seventh anniversary date of the First
Distribution Date, 50% of the Original Class B Principal Balance; and (iii)
over the prior three months, the average aggregate outstanding Principal
Balance of the Mortgage Loans delinquent 60 days or more (including for this
purpose any Mortgage Loans in foreclosure and Mortgage Loans with respect to
which the related Mortgaged Property has been acquired by the Trust Fund) has
not exceeded 3.00% of the average aggregate outstanding Principal Balance of
all Mortgage Loans for such period, then the Class A Prepayment Percentage for
such Distribution Date will be as follows: (A) as to any Distribution Date
prior to the third anniversary of the First Distribution Date, the Class A
Percentage for such Distribution Date plus 50% of the Subordinated Percentage
for such Distribution Date; and (B) as to any Distribution Date thereafter,
the Class A Percentage for such Distribution Date.
CLASS A PRINCIPAL BALANCE: At any time, the Original Class A
Principal Balance minus the sum of all amounts previously distributed to the
Class A Certificateholders on account of principal pursuant to Section 6.01.
CLASS A UNPAID INTEREST SHORTFALL: As to any Distribution Date, the
amount of the Class A Interest Shortfall for the immediately preceding
Distribution Date.
CLASS B CERTIFICATE: Any one of the Certificates designated as a
Class B Certificate substantially in the form set forth in Exhibit D hereto
and executed by the Company and authenticated by the Trustee.
CLASS B FORMULA PRINCIPAL DISTRIBUTION AMOUNT: As to any Distribution
Date, the sum of (i) the Subordinated Percentage of the Scheduled Formula
Principal Amount and (ii) the Subordinated Prepayment Percentage of the
Unscheduled Formula Principal Distribution Amount.
CLASS B INTEREST FORMULA DISTRIBUTION AMOUNT: As to any Distribution
Date, an amount equal to the sum of (a) interest for the related Accrual
Period at the Class B Pass-Through Rate on the Class B Principal Balance as of
such Distribution Date (before giving effect to the distribution on such
Distribution Date), net of Net Interest Shortfall, if any, allocated to the
Class B Certificates pursuant to Section 6.01 in respect of such Distribution
Date, and (b) any Class B Unpaid Interest Shortfall for such Distribution
Date, and (c) any Basis Risk Carryover Amount allocated to the Class B
Certificates pursuant to Section 5.15 in respect of such Distribution Date.
CLASS B INTEREST SHORTFALL: As to any Distribution Date, the amount
equal to (a) the Class B Interest Formula Distribution Amount for such
Distribution Date (except for any Basis Risk Carryover Amount allocated to the
Class B Certificates on such Distribution Date), less (b) the amount of
interest distributed to the Class B Certificateholders on such Distribution
Date pursuant to Section 6.01(a)(v), less the amount of any Basis Risk
Carryover Amount actually distributed from the Carryover Reserve Fund to the
Class B Certificates on such Distribution Date.
CLASS B LOSS AMOUNT: As to any Distribution Date, the lesser of (x),
the amount, if any, by which (A) the sum of (i) the Formula Principal
Distribution Amount for such Distribution Date and (ii) the aggregate of the
Unrecovered Principal Amounts, if any, for such Distribution Date exceeds (B)
the portion of the Available Distribution Amount distributed on account of
principal on such Distribution Date and (y) the Class B Principal Balance
after giving effect to any amount distributed on account of principal to the
Class B Certificateholders on such Distribution Date.
CLASS B LOSS AMOUNT INTEREST REQUIREMENT: As to any Distribution
Date, the amount, if any, equal to the sum of (a) interest for the related
Accrual Period at the Class B Pass-Through Rate on any Class B Loss Amount for
the immediately preceding Distribution Date, (b) interest for the related
Accrual Period at the Class B Pass-Through Rate on any Class B Loss Amount
Unpaid Interest Shortfall for such Distribution Date (to the extent legally
permitted), and (c) any Class B Loss Amount Unpaid Interest Shortfall for such
Distribution Date.
CLASS B LOSS AMOUNT INTEREST SHORTFALL: As to any Distribution Date,
the amount, if any, equal to (a) the Class B Loss Amount Interest Requirement
for such Distribution Date less (b) the amount of interest distributed to the
Class B Certificateholders on such Distribution Date in respect of the Class B
Loss Amount Interest Requirement.
CLASS B LOSS AMOUNT UNPAID INTEREST SHORTFALL: As to any Distribution
Date, the amount of the Class B Loss Amount Interest Shortfall for the
immediately preceding Distribution Date.
CLASS B PASS-THROUGH RATE: As to any Distribution Date, the per annum
rate equal to the lesser of (i) LIBOR plus 1.25%, (ii) the Alternate
Certificate Rate, and (iii) 11.86% per annum.
CLASS B PRINCIPAL BALANCE: At any time, the Original Class B
Principal Balance minus (i) the sum of all amounts previously distributed to
the Class B Certificateholders pursuant to Section 6.01 on account of
principal and (ii) the sum of all Class B Loss Amounts, if any, for prior
Distribution Dates; provided that the Class B Principal Balance shall not be
less than zero.
CLASS B UNPAID INTEREST SHORTFALL: As to any Distribution Date, the
amount of the Class B Interest Shortfall for the immediately preceding
Distribution Date.
CLASS C CERTIFICATE: Any one of the Certificates designated as a
Class C Certificate substantially in the form set forth in Exhibit E hereto
and executed by the Company and authenticated by the Trustee.
CLASS C INTEREST FORMULA DISTRIBUTION AMOUNT: As to any Distribution
Date, an amount equal to the lesser of (i) the Formula Excess Interest Amount
and (ii) the sum of (a) the Component C-1 Current Interest, (b) the Component
C-2 Current Interest, and (c) any Class C Unpaid Interest Shortfall for such
Distribution Date, in both cases reduced by any amounts distributed to either
or both the Class A and Class B Certificateholders pursuant to Sections
6.01(a)(iv) (but only to the extent of that portion, if any, of the
Reimbursement Amount representing interest at the Late Penalty Rate),
6.01(a)(vi), Section 6.01(a)(vii) and/or 6.01(a)(ix) on such Distribution
Date.
CLASS C INTEREST SHORTFALL: As to any Distribution Date, the amount
equal to (a) the Class C Interest Formula Distribution Amount for such
Distribution Date less (b) the amount of interest distributed to the Class C
Certificateholders on such Distribution Date.
CLASS C UNPAID INTEREST SHORTFALL: As to any Distribution Date, the
amount of the Class C Interest Shortfall for the immediately preceding
Distribution Date.
CLASS R CERTIFICATE: Any one of the Certificates executed and
delivered by the Company and authenticated by the Trustee substantially in the
form set forth in Exhibit F.
CLASS R DISTRIBUTION AMOUNT: As to any Distribution Date, the
aggregate amount distributed to the Class R Certificateholder on such
Distribution Date pursuant to Section 6.01.
CLOSING DATE: December 21, 1999.
CODE: The Internal Revenue Code of 1986, as amended.
COMPANY: MLCC Mortgage Investors, Inc., a Delaware corporation, or
its successor in interest or any successor under this Agreement appointed as
herein provided.
COMPONENT C-1 CURRENT INTEREST: As to any Distribution Date, an
amount equal to (x) one month's interest at the Lower-Tier Pass-Through Rate
on the Lower-Tier A Principal Balance as of such Distribution Date (before
giving effect to any distributions on such Distribution Date) minus (y) one
month's interest at the Class A Pass-Through Rate on the Lower-Tier A
Principal Balance as of such Distribution Date (before giving effect to any
distributions on such Distribution Date), in both cases net of their
applicable portion of the Net Interest Shortfall, if any, allocated to the
Class C Certificates pursuant to Section 6.01 in respect of such Distribution
Date.
COMPONENT C-2 CURRENT INTEREST: As to any Distribution Date, an
amount equal to (x) one month's interest at the Lower-Tier Pass-Through Rate
on the Lower-Tier B Principal Balance as of such Distribution Date (before
giving effect to any distributions on such Distribution Date) minus (y) one
month's interest at the Class B Pass-Through Rate on the Lower-Tier B
Principal Balance as of such Distribution Date (before giving effect to any
distributions on such Distribution Date), in both cases net of their
applicable portion of the Net Interest Shortfall, if any, allocated to the
Class C Certificates pursuant to Section 6.01 in respect of such Distribution
Date.
CONSTRUCTIVE LOAN-TO-VALUE RATIO: The fraction, expressed as a
percentage, the numerator of which is the outstanding principal amount of the
related Mortgage Loan at the time of origination thereof, less the amount of
the Original Additional Collateral Requirement, if any, and the denominator of
which is the Appraised Value of the related Mortgaged Property at such time
or, in the case of a Mortgage Loan financing the acquisition of the Mortgaged
Property, the sales price of the Mortgaged Property, if such sales price is
less than such Appraised Value.
CONVERSION PRICE: As to any Converting Mortgage Loan, an amount equal
to the outstanding principal balance of such Converting Mortgage Loan, plus
accrued and unpaid interest thereon at the applicable Mortgage Rate to the
date of conversion, less any Servicing Fee payable with respect to such
Converting Mortgage Loan.
CONVERTIBLE MORTGAGE LOAN: Any Mortgage Loan as to which the
Mortgagor, at its option in accordance with the terms thereof, may convert its
Mortgage Rate to either a fixed rate or to a different Index and applicable
Margin (and at the Mortgagor's election, thereafter to a fixed rate).
CONVERTING MORTGAGE LOAN: A Convertible Mortgage Loan as to which the
Mortgagor is entitled to give and has properly given notice under the terms
thereof that such Mortgagor is exercising such Mortgagor's option to convert
the related Mortgage Rate to a fixed rate. A Mortgage Loan that converts to a
different Index is not a Converting Mortgage Loan.
COOPERATIVE MORTGAGE LOAN: A Mortgage Loan originated to purchase or
refinance the acquisition of Cooperative Shares, and included in the Trust
Fund.
COOPERATIVE SHARES: The shares of stock issued by a private,
non-profit cooperative apartment corporation, which are represented by a stock
certificate and are owned by a Mortgagor.
CORRESPONDENT LENDER: A mortgage banking related entity from which
MLCC purchases Mortgage Loans under its Correspondent Lending program, as such
program is more fully described in the Prospectus Supplement dated December
16, 1999.
CORRESPONDENT MORTGAGE LOAN: A Mortgage Loan originated by a
Correspondent Lender and included in the Trust Fund.
CORRESPONDING CLASSES OF CERTIFICATES: With respect to each
Lower-Tier Regular Interest, the Class or Classes of Certificates appearing
opposite such Lower-Tier Regular Interest in Section 2.08.
CORPORATE TRUST OFFICE: The principal office of the Trustee at which
at any particular time its corporate business with respect to this Agreement
shall be administered, which office at the date of execution of this
instrument is located at 1761 East St. Andrew Place, Santa Ana, California
92705, Telecopy (714) 247-6900.
CURRENT SUBORDINATION LEVEL: With respect to any Distribution Date,
the percentage derived from the fraction, the numerator of which is the Class
B Principal Balance (before giving effect to the distributions and the
allocation of the Class B Loss Amount for such Distribution Date) and the
denominator of which is the Pool Principal Balance (before giving effect to
the Formula Principal Distribution Amount and the allocation of the
Unrecovered Principal Amounts for such Distribution Date).
CUSTODIAL AGREEMENT: The Master Custodial Agreement, dated as of
April 1, 1996 among Bankers Trust Company of California, N.A., as trustee,
Merrill Lynch Mortgage Investors, Inc., MLCC Mortgage Investors, Inc., MLCC
and The Chase Manhattan Bank, N.A., as custodian.
CUSTODIAN: The custodian under the Custodial Agreement.
CUT-OFF DATE: December 1, 1999 (or the date of origination, if
later).
DEFINITIVE CERTIFICATES: As defined in Section 4.02(l).
DEPOSITORY: The initial Depository shall be The Depository Trust
Company, the nominee of which is CEDE & Co., as the registered Holder of one
or more Class A Certificates evidencing in the aggregate the Original Class A
Principal Balance. The Depository shall at all times be a "clearing
corporation" as defined in Section 8-102(a)(5) of the Uniform Commercial Code
of the State of New York.
DEPOSITORY PARTICIPANT: A broker, dealer, bank or other financial
institution or other Person for whom from time to time a Depository effects
book-entry transfers and pledges of securities deposited with the Depository.
DETERMINATION DATE: The fifth day (or if such fifth day is not a
Business Day, the Business Day immediately preceding such fifth day) of the
month of the related Distribution Date.
DISQUALIFIED ORGANIZATION: As defined in Section 4.02(i).
DISTRIBUTION ACCOUNT: The account created and maintained pursuant to
Section 6.01(c).
DISTRIBUTION ACCOUNT SHORTFALL: With respect to any Distribution
Date, the sum of (a) the amount, if any, by which (x) the aggregate of the
full amounts that are due to be distributed on the Class A Certificates
pursuant to clauses (i) and (ii) of Section 6.01(a) exceeds (y) the amount of
the funds (other than the Insured Payment made in respect of such Distribution
Date) that will be on deposit in the Distribution Account in respect of such
Distribution Date and then available to be distributed on the Class A
Certificates, after taking into account all deposits required to be made to
the Distribution Account on or prior to such Distribution Date, including
without limitation all Advances, funds to be transferred from the Pre-Funding
Earnings, the amount deposited by the Company pursuant to the last paragraph
of Section 6.01(a) and payments under the Certificate Guaranty Surety Bond,
and (b) on the third Distribution Date succeeding the month in which there
occurs the latest original scheduled maturity date of any Mortgage Loan that
was an Outstanding Mortgage Loan at any time during such month, the amount, if
any, necessary to reduce the Class A Principal Balance to zero (after giving
effect to all other distributions of principal to be made on such Distribution
Date in respect of the Class A Certificates), without deduction, in the case
of either of the foregoing clauses (a) or (b), of any amounts required to be
withheld that are attributable to the liability of the Trust Fund or the
Trustee for withholding taxes (including, without limitation, interest and
penalties in respect thereof).
DISTRIBUTION DATE: The 15th day of any month, or if such 15th day is
not a Business Day, the first Business Day immediately following, beginning
with the First Distribution Date.
DUE DATE: As to any Distribution Date, the first day of the month of
such Distribution Date, which is the day on which each Monthly Payment is due
on a Mortgage Loan, exclusive of any days of grace.
DUE PERIOD: With respect to any Distribution Date, the calendar month
preceding the month of such Distribution Date.
ELIGIBLE ACCOUNT: An account that is (i) maintained with a federal or
state chartered depository institution the short-term unsecured debt
obligations of which have been rated by each Rating Agency in its highest
short-term rating category at the time of the deposit therein, or (ii) a trust
account maintained with the corporate trust department of a depository
institution, which institution is acting in its fiduciary capacity, or (iii)
an account or accounts the deposits in which are fully insured by the FDIC, or
(iv) an account or accounts in a depository institution in which such accounts
are insured by the FDIC (to the limits established by the FDIC), the uninsured
deposits in which accounts are otherwise either (a) secured such that, as
evidenced by an Opinion of Counsel delivered to the Trustee and acceptable to
the Rating Agencies, the Certificateholders have a claim with respect to the
funds in such account and a perfected first security interest against any
collateral and the proceeds thereof (which shall be limited to Eligible
Investments) securing such funds that is superior to claims of any other
depositors or creditors of the depository institution with which such account
is maintained or (b) swept at the end of each Business Day into either (1)
Eligible Investments in the name of the Trustee so that the amount remaining
in such account (after giving effect to such sweep) is fully insured by the
FDIC or (2) an account that satisfies clause (ii) above, (v) maintained with
Bankers Trust Company of California, N.A. so long as its short-term unsecured
debt obligations have been rated P-1 by Moody's and A-1 by Standard & Poor's
at the time of the deposit therein, or (vi) otherwise acceptable to each
Rating Agency without reduction or withdrawal of each rating of the Class A
Certificates, as evidenced by a letter from each Rating Agency.
ELIGIBLE INVESTMENTS: One or more of the following:
(a) obligations of, or guaranteed as to principal and interest
by, the United States or obligations of any agency or instrumentality
thereof when such obligations are backed by the full faith and credit
of the United States;
(b) repurchase agreements (including those in which the
purchased securities are held by a third-party custodian) on
obligations specified in clause (a) maturing not later than the day
prior to the Distribution Date on which such amounts are to be
distributed, provided that the long-term unsecured obligations of the
party agreeing to repurchase such obligations are at the time rated
by each Rating Agency in one of its two highest rating categories and
the short-term debt obligations of the party agreeing to repurchase
shall be rated P-1 by Moody's and A-1+ by Standard & Poor's;
(c) certificates of deposit, time deposits, demand deposits and
bankers' acceptances (which shall each have an original maturity of
not more than 90 days and, in the case of bankers' acceptances, shall
in no event have an original maturity of more than 365 days) of any
United States depository institution or trust company incorporated
under the laws of the United States or any state, provided that the
long-term unsecured debt obligations of such depository institution
or trust company at the date of acquisition thereof have been rated
by each Rating Agency in one of its two highest rating categories and
the short-term obligations of such depository institution or trust
company shall be rated P-1 by Moody's and A-1+ by Standard & Poor's;
(d) commercial paper (having original maturities of not more
than 365 days) of any corporation incorporated under the laws of the
United States or any state thereof which on the date of acquisition
has been rated by Moody's and Standard & Poor's in its highest
short-term rating (which is P-1 in the case of Moody's and A-1+ in
the case of Standard & Poor's); provided that such commercial paper
shall mature no later than the day prior to the Distribution Date on
which such amounts are to be distributed;
(e) money market funds with the highest long-term rating
assigned by the Rating Agencies; and
(f) other obligations or securities that are "permitted
investments" within the meaning of Section 860(G)(a)(5) of the Code,
based upon an Opinion of Counsel delivered to the Trustee, the
Certificate Insurer and the Surety, and acceptable to each Rating
Agency, the Certificate Insurer and the Surety as an Eligible
Investment hereunder and will not result in a reduction or withdrawal
of the then current rating of the Class A Certificates, as evidenced
by a letter to such effect from each Rating Agency;
provided that, except in the case of U.S. Treasury STRIPS, no instrument shall
be an Eligible Investment if such instrument evidences either (a) a right to
receive only interest payments with respect to the obligation underlying such
instrument, or (b) a right to receive both principal and interest payments
derived from obligations underlying such instrument where the interest and
principal payments with respect to such instrument provide a yield to maturity
of greater than 120% of the yield to maturity at par of such underlying
obligations.
ERISA: The Employee Retirement Income Security Act of 1974, as
amended.
ESCROW ACCOUNT: The account or accounts created and maintained
pursuant to Section 5.10.
ESCROW PAYMENTS: The amounts constituting applicable ground rents,
taxes, assessments, water rates and other payments required to be escrowed by
the Mortgagor with the mortgagee pursuant to the Mortgage Loan.
FANNIE MAE: Fannie Mae (formerly the Federal National Mortgage
Association) or any successor organization.
FDIC: The Federal Deposit Insurance Corporation or any successor
organization.
FIDELITY BOND: A fidelity bond to be maintained by the Master
Servicer pursuant to Section 5.19.
FIRST DISTRIBUTION DATE: January 18, 2000.
FORMULA EXCESS INTEREST AMOUNT: With respect to any Distribution
Date, the amount, if any, by which one month's interest at the Alternate
Certificate Rate on the Pool Principal Balance at the beginning of the related
Principal Prepayment Period (giving effect to the Monthly Payment due on such
Due Date and Principal Prepayments prior to such Due Date) is in excess of one
month's interest at the weighted average of the Class A and Class B
Pass-Through Rates for such Distribution Date on the aggregate principal
balances of such Certificates (before giving effect to any distributions or
Class B Loss Amounts for such Distribution Date).
FORMULA PRINCIPAL DISTRIBUTION AMOUNT: As to any Distribution Date,
an amount equal to the sum of:
(a) the principal portion of all Monthly Payments, whether or not
received, which were due on the related Due Date on Outstanding Mortgage Loans
as of such Due Date;
(b) with respect to each Mortgage Loan, all Principal Prepayments
made by the Mortgagor during the related Principal Prepayment Period;
(c) with respect to each Mortgage Loan not described in (e) below,
all Insurance Proceeds, condemnation awards and any other cash proceeds from a
source other than the Mortgagor, to the extent required to be deposited in the
Certificate Account pursuant to Section 5.08(iv) and (v), which are allocable
to principal and were received during the related Principal Prepayment Period,
net of related unreimbursed Servicing Advances and net of any portion thereof
which, as to such Mortgage Loan, constitutes Late Collections;
(d) with respect to each Mortgage Loan that has been repurchased
pursuant to Section 11.01 during the related Principal Prepayment Period, an
amount equal to the Principal Balance of the Mortgage Loan as of the date of
repurchase;
(e) with respect to each Mortgage Loan that became a Liquidated
Mortgage Loan during the related Principal Prepayment Period, the amount
allocable to the principal of such Liquidated Mortgage Loan that was recovered
out of Net Liquidation Proceeds in respect of such Liquidated Mortgage Loan in
such Principal Prepayment Period; and
(f) with respect to each Mortgage Loan repurchased during the related
Principal Prepayment Period by the Master Servicer or the Mortgage Loan Seller
pursuant to Sections 2.01, 2.02, 3.01, 3.04 and 5.01, an amount equal to the
principal amount of the Purchase Price (exclusive of any portion thereof
included in clause (a) above).
FREDDIE MAC: Freddie Mac (formerly the Federal Home Loan Mortgage
Corporation) or any successor organization.
GNMA: The Government National Mortgage Association or any successor
organization.
INDEPENDENT: Of or relating to a Person which (i) is in fact
independent of the Company and the Master Servicer, (ii) does not have any
direct financial interest or any material indirect financial interest in the
Company and the Master Servicer if different from the Company or an Affiliate
thereof and (iii) is not connected with the Company or the Master Servicer as
an officer, employee, director or person performing similar functions.
INDEX: As to each Mortgage Loan, the index for the adjustment of the
Mortgage Rate on the related Mortgage Note, which index is the prime rate
(referred to in Section 3.01 as the "Prime Index"), the London interbank
offered rate for one-month U.S. Dollar deposits (referred to in Section 3.01
as the "One-Month LIBOR Index"), the London interbank offered rate for
six-month U.S. dollar deposits (referred to in Section 3.01 as the "Six-Month
LIBOR Index"), or the weekly average yield on U.S. Treasury securities
adjusted to a constant maturity of one year (referred to in Section 3.01 as
the "Treasury Index"), in each case as defined in such Mortgage Note.
INDEX CONVERTIBLE MORTGAGE LOAN: Any Mortgage Loan as to which the
Mortgagor, at its option in accordance with the terms thereof, may convert its
Mortgage Rate to a different Index and applicable Margin. An Index Convertible
Mortgage Loan may also be a Convertible Mortgage Loan.
INITIAL MORTGAGE LOANS: The Mortgage Loans other than the Subsequent
Mortgage Loans.
INSURANCE AGREEMENT: The Insurance and Indemnity Agreement, dated as
of December 21, 1999, among the Company, the Master Servicer, the Certificate
Insurer and the Trustee.
INSURANCE PROCEEDS: Proceeds paid by any insurer pursuant to any
insurance policy covering a Mortgage Loan, net of costs of collecting such
proceeds.
INSURED AMOUNT: As defined in the Certificate Insurance Policy.
INSURED EXPENSES: Expenses covered by any insurance policy.
INSURED PAYMENT: As defined in the Certificate Insurance Policy.
INTEREST ADJUSTMENT DATE: The date specified in a Mortgage Note on
which its Mortgage Rate is adjusted. NEW LATE COLLECTIONS: With respect to any
Mortgage Loan, all amounts received during any Due Period, whether as late
payments of Monthly Payments or as Liquidation Proceeds, condemnation awards,
Insurance Proceeds, or with respect to a disposition of a Mortgaged Property
which has been acquired by foreclosure or deed in lieu of foreclosure or
otherwise, any of which represent late payments or collections of Monthly
Payments that were due but delinquent for a previous Due Date and not
previously recovered and with respect to which delinquent Monthly Payments an
Advance has been made by the Master Servicer or, under the circumstances set
forth in Section 6.03(b), by the Trustee.
LATE PAYMENT RATE: As defined in the Insurance Agreement.
LIBOR: As to any Distribution Date as follows:
(i) the posted rate for United States dollar deposits for
one month which appears on Telerate Page 3750 (as defined below) as
of 11:00 A.M., London time, on the second LIBOR Business Day prior to
the immediately preceding Distribution Date (or, in the case of the
First Distribution Date, December 17, 1999). If no such posted rate
appears, LIBOR will be determined on such date as described in clause
(ii) below. "Telerate Page 3750" means the display page designated on
the Bridge Information Systems Telerate Service (or such other page
as may replace that page on that service, or such other service as
may be nominated as the information vendor, for the purpose of
displaying London inter-bank offered rates of major banks).
(ii) If on such date no posted rate appears on the Telerate
Page 3750 as described in clause (i) above, the Trustee will request
the principal London office of each of four reference banks (which
shall be National Westminster Bank Plc, Deutsche Bank AG, Lloyds Bank
Plc, and Barclays Bank Plc, so long as each such bank is engaged in
transactions in the London inter-bank market) ("Reference Banks") to
provide the Trustee with its offered quotation for United States
dollar deposits for one month to prime banks in the London inter-bank
market as of 11:00 A.M., London time, on such date. If at least two
reference banks provide the Trustee with such offered quotations,
then LIBOR on such date will be the arithmetic mean (rounded, if
necessary, to the nearest 1/100th of a percent (.0001), with a
5/1,000th of a percent (.00005) rounded upwards) of all such
quotations. If on such date fewer than two of the Reference Banks
provide the Trustee with such an offered quotation, LIBOR on such
date will be the arithmetic mean (rounded, if necessary, to the
nearest 1/100th of a percent (.0001), with a 5/1,000th of a percent
(.00005) rounded upwards) of the offered per annum rates which one or
more leading banks in The City of New York selected by the Trustee
(after consultation with the Servicer) are quoting as of 11:00 A.M.,
New York City time, on such date to leading European banks for United
States dollar deposits for one month, provided, however, that if such
banks are not quoting as described above, LIBOR will be the LIBOR
applicable to the immediately preceding Distribution Date.
LIBOR BUSINESS DAY: A Business Day and a day on which banking
institutions in the City of London, England, are not required or authorized by
law to be closed.
LIQUIDATED MORTGAGE LOAN: Any defaulted Mortgage Loan as to which the
related Mortgaged Property has been acquired, liquidated or disposed of and
with respect to which the Master Servicer has determined that all amounts
which it expects to recover from or on account of such Mortgage Loan or
property acquired in respect thereof have been recovered.
LIQUIDATION EXPENSES: Expenses which are incurred by the Master
Servicer or any Sub-Servicer in connection with the liquidation of any
defaulted Mortgage Loan or property acquired in respect thereof, including,
without limitation, legal fees and expenses, any unreimbursed amount expended
by the Master Servicer pursuant to Sections 5.16 and 5.21 respecting the
related Mortgage Loan and any related and unreimbursed expenditures for real
estate property taxes or for property restoration or preservation.
LIQUIDATION PROCEEDS: Cash (including Insurance Proceeds) received by
the Master Servicer in connection with the liquidation of any defaulted
Mortgage Loan or Mortgaged Property acquired in respect thereof, whether
through the sale or assignment of such Mortgage Loan, trustee's sale,
foreclosure sale or otherwise, or the sale of the Mortgaged Property if the
Mortgaged Property is acquired in satisfaction of the Mortgage Loan other than
amounts required to be paid to the Mortgagor pursuant to law or the terms of
the applicable Mortgage Note plus, with respect to a defaulted Mortgage Loan
that is also an Additional Collateral Mortgage Loan, the amount realized on
the related Additional Collateral with respect to such Mortgage Loan in
accordance with Section 5.21.
LOAN-TO-VALUE RATIO: The fraction, expressed as a percentage, the
numerator of which is the outstanding principal amount of the related Mortgage
Loan at the time of origination and the denominator of which is the Appraised
Value of the related Mortgaged Property at such time or, in the case of a
Mortgage Loan financing the acquisition of the Mortgaged Property, the sales
price of the Mortgaged Property, if such sales price is less than such
Appraised Value.
LOWER-TIER A PRINCIPAL BALANCE: At any time, an amount equal to the
Class A Principal Balance.
LOWER-TIER B PRINCIPAL BALANCE: At any time, an amount equal to the
Class B Principal Balance.
LOWER-TIER INTEREST: Any one of the Lower-Tier Regular Interests or
the Lower-Tier Interest R.
LOWER-TIER INTEREST A: An uncertificated "regular interest" in the
Lower-Tier REMIC which is held as an asset of the Upper-Tier REMIC.
LOWER-TIER INTEREST B: An uncertificated "regular interest" in the
Lower-Tier REMIC which is held as an asset of the Upper-Tier REMIC.
LOWER-TIER INTEREST R: The sole class of "residual interest" in the
Lower-Tier REMIC.
LOWER-TIER PASS-THROUGH RATE: For any interest bearing Lower-Tier
Regular Interest, the per annum rate set forth or calculated in the manner
described in Section 2.08.
LOWER-TIER REGULAR INTEREST: Lower-Tier Interest A or Lower-Tier
Interest B.
LOWER-TIER REMIC: As described in Section 2.05.
MARGIN: With respect to each Mortgage Loan, the number of basis
points which are added to or subtracted from the Index to establish the
Mortgage Rate on the related Mortgage Note.
MASTER SERVICER: Merrill Lynch Credit Corporation, a Delaware
corporation, or its successor in interest or any successor under this
Agreement as herein provided.
MAXIMUM MORTGAGE RATE: With respect to each Mortgage Loan, the
maximum rate of interest set forth as such in the related Mortgage Note.
MLCC: Merrill Lynch Credit Corporation and its successors in
interest.
MONTHLY PAYMENT: The minimum required monthly payment of principal
and interest due on a Mortgage Loan as specified in the Mortgage Note for any
month (before any adjustment to such scheduled amount by reason of any
bankruptcy or similar proceeding or any moratorium or similar waiver or grace
period). Monthly Payments shall be deemed due on an Outstanding Mortgage Loan
until such time as it becomes a Liquidated Mortgage Loan.
MOODY'S: Moody's Investors Service, Inc. or its successor in interest.
MORTGAGE: The mortgage, deed of trust or other instrument creating a
first lien or a first priority ownership interest in an estate in fee simple
in real property (or a leasehold that extends at least five years beyond the
maturity of the related Mortgage Loan) securing a Mortgage Note.
MORTGAGE 100(sm) LOAN: A Mortgage Loan having at the time of
origination a Loan-to-Value Ratio generally in excess of MLCC's maximum
acceptable Loan-to-Value Ratio for such Mortgage Loan, which Mortgage Loan is
secured by additional collateral in the form of a security interest in
marketable securities having a market value, as of the date of such loan's
origination, at least equal to the Original Additional Collateral Requirement.
MORTGAGE 100(sm) PLEDGE AGREEMENT: With respect to each Mortgage
100(sm) Loan, the Mortgage 100(sm) Pledge Agreement for Securities Account
between the Mortgagor under such Mortgage 100(sm) Loan and MLCC, pursuant to
which such Mortgagor granted a security interest in various investment
securities.
MORTGAGE FILE: The items referred to in Exhibit B annexed hereto
pertaining to a particular Mortgage Loan.
MORTGAGE LOAN: Each of the mortgage loans and all rights with respect
thereto, evidenced by a Mortgage and a Mortgage Note plus, in the case of an
Additional Collateral Mortgage Loan, the Mortgage 100(sm) Pledge Agreement or
Parent Power(R) Agreement, sold and assigned by the Company to the Trustee and
which is the subject of this Agreement and included in the Trust Fund. The
Mortgage Loans originally sold and subject to this Agreement (including any
Cooperative Mortgage Loan) are identified on the Mortgage Loan Schedule. The
term "Mortgage Loan" includes each Subsequent Mortgage Loan as of the
Subsequent Transfer Date applicable thereto.
MORTGAGE LOAN SCHEDULE: The schedule of Mortgage Loans attached
hereto as Exhibit A, setting forth the following information as to each
Mortgage Loan: (i) the Mortgage Loan identifying number; (ii) a code
indicating whether the Mortgaged Property is owner-occupied; (iii) the
property type of the Mortgaged Property; (iv) the original number of months to
maturity and the number of months remaining to maturity from the Cut-off Date;
(v) the Appraised Value of the Mortgaged Property as set forth in an appraisal
which was delivered at the time of the origination of the Mortgage Loan, or,
in the event the Mortgage Loan was made in connection with the acquisition of
the Mortgaged Property by the Mortgagor, the lesser of such Appraised Value
and the purchase price of the Mortgaged Property actually paid by the
Mortgagor at the time of the origination of the Mortgage Loan; (vi) the
original Loan-to-Value Ratio; (vii) the current Mortgage Rate; (viii) the
current Margin; (ix) the amount of the current Monthly Payment; (x) the next
Interest Adjustment Date; (xi) the original Principal Balance of the Mortgage
Loan; and (xii) the Principal Balance of the Mortgage Loan as of the close of
business on the Cut-off Date. The Mortgage Loan Schedule shall include each
Schedule of Subsequent Mortgage Loans delivered on a Subsequent Transfer Date.
MORTGAGE LOAN SELLER: Merrill Lynch Credit Corporation, a Delaware
corporation, and its successors and assigns.
MORTGAGE NOTE: The note or other evidence of the indebtedness of a
Mortgagor secured by a Mortgage.
MORTGAGE POOL: The pool of Mortgage Loans held in the Trust Fund.
MORTGAGE RATE: With respect to each Mortgage Loan, the per annum rate
of interest for the applicable period borne by the Mortgage Loan, as
determined pursuant to the Mortgage Note.
MORTGAGED PROPERTY: The property subject to a Mortgage, which may
include Co-op Shares.
MORTGAGOR: The obligor on a Mortgage Note.
NET INTEREST SHORTFALL: With respect to any Distribution Date, the
sum of (i) the Net Prepayment Interest Shortfall, if any, for such
Distribution Date and (ii) the Relief Act Reduction, if any, for such
Distribution Date as determined in Section 6.01.
NET LIQUIDATION PROCEEDS: As to any Liquidated Mortgage Loan,
Liquidation Proceeds net of Liquidation Expenses.
NET MORTGAGE RATE: As to any day and Mortgage Loan, its Mortgage Rate
less the sum of (i) the Servicing Fee Rate, and (ii) the Premium Amount
(expressed as a per annum rate).
NET PREPAYMENT INTEREST SHORTFALL: As to any Distribution Date, the
aggregate of the Prepayment Interest Shortfalls incurred on the Mortgage Loans
in the preceding Principal Prepayment Period that were not made up by the
application of the Servicing Fees collected by the Master Servicer in respect
of such Principal Prepayment Period pursuant to Section 6.03(c).
NONRECOVERABLE ADVANCE: Any advance previously made or proposed to be
made in respect of a Mortgage Loan by the Master Servicer or the Trustee
pursuant to Section 6.03 which, in the good faith judgment of the Master
Servicer or the Trustee, will not be ultimately recoverable by the Master
Servicer or the Trustee from Late Collections, Liquidation Proceeds or
otherwise. The determination by the Master Servicer that it has made, or would
be making, a Nonrecoverable Advance shall be evidenced by a certificate of a
Servicing Officer of the Master Servicer delivered to the Trustee and the
Company and detailing the reasons for such determination.
NON-U.S. PERSON: An individual, corporation, partnership or other
Person other than a citizen or resident of the United States, a corporation,
partnership or other entity treated as a corporation or partnership for
federal income tax purposes, created or organized in or under the laws of the
United States, any state thereof or the District of Columbia or an estate that
is subject to U.S. federal income tax (regardless of the source of its income)
or a trust if (a) a court within the United States is able to exercise primary
supervision over the administration of the trust and (b) one or more United
States trustees have authority to control all substantial decisions of trust.
OFFICERS' CERTIFICATE: A certificate signed by any one of the
Chairmen of the Board, Vice Chairman of the Board, the President, a Senior
Vice President, a Vice President, an Assistant Vice President, the Treasurer,
an Assistant Treasurer, the Secretary, an Assistant Secretary or any other
duly authorized officer of the Company or the Master Servicer, as the case may
be, and delivered to the Trustee.
OPINION OF COUNSEL: A written opinion of counsel, who may be counsel
for the Company or the Master Servicer and who is reasonably acceptable to the
Trustee and the Surety and the Certificate Insurer; provided, however that the
Trustee and the Surety and the Certificate Insurer shall receive an opinion of
Independent counsel with respect to any opinion submitted regarding the
qualification of the Trust Fund (exclusive of the Mortgage 100(sm) Pledge
Agreements, the Parent Power(R) Agreements, the Pre-Funding Account (including
the funds therein and Pre-Funding Earnings) and the Carryover Reserve Fund
(including the funds therein)) as two REMICs or compliance with any of the
REMIC Provisions.
ORIGINAL ADDITIONAL COLLATERAL REQUIREMENT: With respect to any
Additional Collateral Mortgage Loan, an amount equal to the Additional
Collateral required by the Company at the time of the origination of such
Additional Collateral Mortgage Loan in order to achieve a Constructive
Loan-to-Value Ratio for such Additional Collateral Mortgage Loan, generally
equal to seventy percent (70%); for purposes of the Required Surety Payment,
in no event shall the Original Additional Collateral Requirement for an
Additional Collateral Mortgage Loan exceed thirty percent (30%) of its
original principal balance.
ORIGINAL CLASS A PRINCIPAL BALANCE: $689,500,000.
ORIGINAL CLASS B PRINCIPAL BALANCE: $10,500,000.
ORIGINAL POOL PRINCIPAL BALANCE: (including the Pre-Funded Amount)
$700,000,000.
ORIGINAL PRE-FUNDED AMOUNT: $82,768,119.
ORIGINAL SUBORDINATION LEVEL: The percentage derived from the
fraction the numerator of which is the Original Class B Principal Balance and
the denominator of which is the Original Pool Principal Balance, which
percentage is 1.50%.
ORIGINATE or ORIGINATION: When used with respect to a Mortgage Loan
(whether or not used as a capitalized term), the closing and funding of such
Mortgage Loan.
OUTSTANDING MORTGAGE LOAN: As to any Due Date, a Mortgage Loan which
was not the subject of a Principal Prepayment in full prior to such Due Date,
which did not become a Liquidated Mortgage Loan prior to such Due Date and
which was not repurchased under Section 2.01, 2.02, 3.01, 3.04 or 5.01 prior
to such Due Date.
PARENT POWER(R) AGREEMENT: With respect to each Parent Power(R)
Mortgage Loan, a Parent Power(R) Guaranty and Security Agreement for
Securities Account or a Parent Power(R) Guaranty Agreement for Real Estate.
PARENT POWER(R) GUARANTY AGREEMENT FOR REAL ESTATE: With respect to a
Parent Power(R) Mortgage Loan, an agreement between MLCC and a guarantor on
behalf of the Mortgagor under such Parent Power(R) Mortgage Loan pursuant to
which such guarantor guarantees the payment of certain losses under such
Parent Power(R) Mortgage Loan, authorizes MLCC to draw on a home equity credit
line to fund such guaranty and has secured such guaranty with a lien on
residential real estate of the guarantor. The required amount of the
collateral supporting such guaranty is at least equal to the Original
Additional Collateral Requirement for such Parent Power(R) Mortgage Loan. For
purposes of this definition, the Parent Power(R) Guaranty Agreement For Real
Estate shall not include the rights of the mortgagee under the security
instrument relating to the Equity Access(R) Account (as defined in the related
Parent Power(R) Agreement) referred to therein, which rights have been
retained by MLCC.
PARENT POWER(R) GUARANTY AND SECURITY AGREEMENT FOR SECURITIES
ACCOUNT: With respect to a Parent Power(R) Mortgage Loan, an agreement between
MLCC and a guarantor on behalf of the Mortgagor under such Parent Power(R)
Mortgage Loan pursuant to which such guarantor guarantees the payment of
certain losses under such Parent Power(R) Mortgage Loan and has granted a
security interest to MLCC in certain marketable securities to collateralize
such guaranty. The required amount of such collateral is at least equal to the
Original Additional Collateral Requirement for such Parent Power(R) Mortgage
Loan.
PARENT POWER(R) MORTGAGE LOAN: A Mortgage Loan having at the time of
origination a Loan-to-Value Ratio generally in excess of MLCC's maximum
acceptable Loan-to-Value Ratio for such Mortgage Loan, which Mortgage Loan is
supported by a Parent Power(R) Agreement.
PAYING AGENT: The Person appointed by the Master Servicer as Paying
Agent pursuant to Section 4.05. If the Master Servicer has not appointed a
Paying Agent, the Master Servicer shall be the Paying Agent.
PAYMENT ADJUSTMENT DATE: The date specified in a Mortgage Note on
which the Monthly Payment is adjusted.
PERCENTAGE INTEREST: As to any Class A or Class B Certificate, the
percentage interest evidenced thereby in distributions required to be made
hereunder, such percentage interest being equal to the percentage obtained by
dividing the denomination of such Certificate by the aggregate of the
denominations of all the Certificates of such Class; and as to the Class C and
Class R Certificates, the Percentage Interest specified on the face thereof.
PERSON: Any individual, corporation, partnership, joint venture,
association, joint-stock company, trust, unincorporated organization or
government or any agency or political subdivision thereof.
POOL PRINCIPAL BALANCE: The Original Pool Principal Balance less (i)
the aggregate of all Formula Principal Distribution Amounts and all
Unrecovered Principal Amounts for, unless otherwise specified, the
Distribution Date in the month of the reference thereto and all prior
Distribution Dates less (ii) the amount distributed from the Pre-Funding
Account to the Class A Certificateholders on account of principal in
accordance with the last sentence of Section 5.14(b).
PREFERENCE AMOUNT: As defined in the Certificate Insurance Policy.
PRE-FUNDED AMOUNT: With respect to any date, the amount on deposit in
the Pre-Funding Account, exclusive of any Pre-Funding Earnings therein.
PRE-FUNDING ACCOUNT: The trust account created and maintained by the
Trustee pursuant to Section 5.14. The Pre-Funding Account shall be an Eligible
Account.
PRE-FUNDING DISTRIBUTION DATE: Each Distribution Date occurring
during the Pre-Funding Period, and the Distribution Date occurring in the
month (i) following the month in which the Pre-Funding Period ends, if such
period ends on or after the Distribution Date in such month or (ii) in which
the Pre-Funding Period ends, if such period ends prior to the Distribution
Date in such month.
PRE-FUNDING EARNINGS: As to any Pre-Funding Distribution Date, the
amount of actual net investment earnings realized or accrued, if applicable,
on amounts on deposit in the Pre-Funding Account during the period beginning
on the Distribution Date in the month preceding such Pre-Funding Distribution
Date (or in the case of the first Pre-Funding Distribution Date, beginning on
the Closing Date) and ending on the Business Day before such Pre-Funding
Distribution Date.
PRE-FUNDING PERIOD: The period commencing on the Closing Date and
ending on the earliest to occur of (i) the date on which the aggregate amount
on deposit in the Pre-Funding Account (exclusive of any investment earnings)
is less than $100,000, (ii) the date on which an Event of Default occurs or
(iii) January 31, 2000.
PREMIUM AMOUNT: With respect to the Certificate Insurance Policy, the
amount that is payable as a premium under the terms of the Certificate
Insurance Policy.
PREPAYMENT INTEREST SHORTFALL: With respect to any Distribution Date,
for each Mortgage Loan that was the subject of a partial Principal Prepayment
or a Principal Prepayment in full during the related Principal Prepayment
Period (other than a Principal Prepayment in full resulting from the purchase
of a Mortgage Loan pursuant to Section 2.02, 3.01, 3.04 or 11.01 hereof), the
amount by which interest paid by the Mortgagor in connection with such
Principal Prepayment of such Mortgage Loan is less than 30 days' interest at
the related Mortgage Rate on the amount paid.
PRINCIPAL BALANCE: At the time of any determination, the principal
balance of a Mortgage Loan remaining to be paid at the close of business on
the Cut-off Date with respect to an Initial Mortgage Loan or the Subsequent
Cut-off Date with respect to a Subsequent Mortgage Loan (after deduction of
all principal payments due on or before the respective Cut-off Date or
Subsequent Cut-off Date whether or not paid but without deducting Monthly
Payments due after the respective Cut-off Date or Subsequent Cut-off Date and
received on or before the respective Cut-off Date or Subsequent Cut-off Date)
reduced by all amounts distributed to Certificateholders that are allocable to
principal of such Mortgage Loan (including Advances made pursuant to Section
6.03).
PRINCIPAL PREPAYMENT: Any payment or other recovery of principal on a
Mortgage Loan (other than Liquidation Proceeds) made by a Mortgagor which is
received in advance of its scheduled Due Date, and which is not accompanied by
an amount of interest representing scheduled interest due on any date or dates
in any month or months subsequent to the month of prepayment.
PRINCIPAL PREPAYMENT PERIOD: With respect to any Distribution Date,
the period beginning on the first day of the month preceding the month in
which such Distribution Date occurs and ending on the last day of the month
preceding the month in which such Distribution Date occurs.
PURCHASE PRICE: With respect to any Mortgage Loan required to be
purchased on any date pursuant to Sections 2.01, 2.02, 3.01, 3.04, 5.01 or
5.07, an amount equal to the sum of (a) 100% of the Principal Balance thereof
plus any unreimbursed Advances of principal thereof and (b) unpaid accrued
interest at the Mortgage Rate thereon from the Due Date to which interest was
last paid by the Mortgagor through the end of the related Due Period.
RATING AGENCY: Standard & Poor's and Moody's. References herein to
the highest long-term debt rating category of a Rating Agency shall mean AAA
in the case of Standard & Poor's and Aaa in the case of Moody's, and
references to the second highest long-term rating category of a Rating Agency
shall mean AA in the case of Standard & Poor's and Aa1, Aa2 or Aa3 in the case
of Moody's.
RECORD DATE: As to each Distribution Date, the last Business Day of
the calendar month immediately preceding the calendar month in which the
Distribution Date occurs (or the Closing Date in the case of the First
Distribution Date).
REIMBURSEMENT AMOUNT: As to any Distribution Date, the sum of (x)(i)
all Insured Payments in respect of the Class A Certificates previously
received by the Trustee and not previously repaid to the Certificate Insurer
pursuant to Section 6.01 plus (ii) interest accrued on each such Insured
Payment not previously repaid, calculated at the Late Payment Rate from the
date the Trustee received the related Insured Payment and (y)(i) any other
amounts then due and owing to the Certificate Insurer under the Insurance
Agreement plus (ii) interest on such amounts at the Late Payment Rate. The
Certificate Insurer shall notify the Trustee and the Master Servicer of the
amount of any Reimbursement Amount.
RELIEF ACT REDUCTION: With respect to any Distribution Date, the
aggregate amount of reductions, if any, in the amount of interest due on the
Mortgage Loans on the related Due Date on account of the Soldiers' and
Sailors' Civil Relief Act of 1940, as amended.
REMIC: A "real estate mortgage investment conduit," as such term is
defined in the Code.
REMIC PROVISIONS: Provisions of the federal income tax law relating
to real estate mortgage investment conduits, which appear at Section 860A
through 860G of Subchapter M of Chapter 1 of the Code, and related provisions,
and regulations promulgated thereunder, as the foregoing may be in effect from
time to time.
REPURCHASE PROCEEDS: All proceeds of any Mortgage Loan or property
acquired in respect thereof repurchased by the Master Servicer or Mortgage
Loan Seller pursuant to Section 2.01, 2.02, 3.01, 3.04, 5.01 or 11.01.
REQUIRED SURETY PAYMENT: With respect to any Additional Collateral
Mortgage Loan that becomes a Liquidated Mortgage Loan, the lesser of (i)
related Additional Collateral Mortgage Loan Liquidation Shortfall and (ii) the
excess, if any, of (a) the Original Additional Collateral Requirement with
respect to such Mortgage Loan over (b) the net proceeds realized by MLCC from
the related Additional Collateral as set forth in Section 5.21.
RESPONSIBLE OFFICER: When used with respect to the Trustee, the
Chairman or Vice Chairman of the Board of Directors or Trustees, the Chairman
or Vice Chairman of the Executive or Standing Committee of the Board of
Directors or Trustees, the President, the Chairman of the Committee on Trust
Matters, any Vice President, any Assistant Vice President, the Secretary, any
Assistant Secretary, the Treasurer, any Assistant Treasurer, the Controller
and any Assistant Controller or any other officer of the Trustee customarily
performing functions similar to those performed by any of the above designated
officers and, with respect to a particular matter, to whom such matter is
referred because of such officer's knowledge of and familiarity with the
particular subject.
SALE AGREEMENT: The Sale and Seller's Warranties Agreement dated as
of December 1, 1999 between the Company and the Mortgage Loan Seller attached
hereto as Exhibit P.
SCHEDULE OF SUBSEQUENT MORTGAGE LOANS: The schedule attached to each
Subsequent Transfer Agreement listing the Subsequent Mortgage Loans being
conveyed to the Trustee on behalf of the Trust Fund pursuant thereto. Each
such schedule shall include the same categories of information set forth in
the definition of the Mortgage Loan Schedule substituting, where appropriate,
information as of the applicable Subsequent Cut-off Date rather than the
Cut-off Date.
SCHEDULED FORMULA PRINCIPAL DISTRIBUTION AMOUNT: With respect to any
Distribution Date, the amount specified in clause (a) of the Formula Principal
Distribution Amount.
SERIOUSLY DELINQUENT MORTGAGE LOAN: Any Mortgage Loan as to which a
Monthly Payment is 90 days or more delinquent.
SERVICING ADVANCES: All customary, reasonable and necessary "out of
pocket" costs and expenses incurred in the performance by the Master Servicer
of its servicing obligations, including, but not limited to, the cost of (i)
the preservation, restoration and protection of the Mortgaged Property, (ii)
any enforcement or judicial proceedings, including foreclosures, (iii) the
management and liquidation of the Mortgaged Property if the Mortgaged Property
is acquired in satisfaction of the Mortgage, (iv) taxes and assessments on the
Mortgaged Properties subject to the Mortgage Loans and (v) compliance with the
obligations under Section 5.12.
SERVICING FEE: With respect to each Mortgage Loan, the amount of the
monthly fee paid for the servicing of such Mortgage Loan, equal to 1/12 of the
Servicing Fee Rate of the Principal Balance of such Mortgage Loan. Such fee
shall be payable only at the time of and with respect to those Mortgage Loans
for which payment is in fact made of the entire amount of the Monthly
Payments. The right to receive the Servicing Fee is limited to, and the
Servicing Fee is payable solely from, the interest portion of such Monthly
Payments collected by the Master Servicer, or as otherwise provided under
Section 5.09.
SERVICING FEE RATE: 0.25% per annum.
SERVICING OFFICER: Any officer of the Master 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 Master Servicer, as such list may from time to time be
amended.
SINGLE CERTIFICATE: A Certificate of any Class (other than a Class C
or Class R Certificate) that evidences a denomination of $1,000.
STANDARD & POOR'S: Standard & Poor's Ratings Services, a division of
The McGraw-Hill Companies, Inc., or its successor in interest.
STANDARD HAZARD POLICY: Each standard hazard insurance policy or
replacement therefor referred to in Section 5.16.
SUBORDINATED PERCENTAGE: As to any Distribution Date, 100% less the
Class A Percentage.
SUBORDINATED PREPAYMENT PERCENTAGE: As to any Distribution Date, 100%
less the Class A Prepayment Percentage.
SUBSEQUENT CUT-OFF DATE: As to those Subsequent Mortgage Loans which
are transferred and assigned to the Trustee on behalf of the Trust Fund
pursuant to a Subsequent Transfer Agreement, the first day of the month in
which the related Subsequent Transfer Date occurs.
SUBSEQUENT MORTGAGE LOANS: The Mortgage Loans sold to the Trust Fund
pursuant to Section 2.03 and the related Subsequent Transfer Agreement, which
shall be listed on the Schedule of Subsequent Mortgage Loans attached to such
Subsequent Transfer Agreement.
SUBSEQUENT TRANSFER AGREEMENT: Each Subsequent Transfer Agreement
dated as of a Subsequent Transfer Date executed by the Trustee and the Company
substantially in the form of Exhibit K herein, pursuant to which Subsequent
Mortgage Loans are sold and assigned to the Trustee.
SUBSEQUENT TRANSFER DATE: The date specified in each Subsequent
Transfer Agreement on which the related Subsequent Mortgage Loans are sold to
the Trust Fund.
SUB-SERVICER: Any Person with whom the Master Servicer enters into a
Sub-Servicing Agreement.
SUB-SERVICING AGREEMENT: Any written contract between the Master
Servicer and any Sub-Servicer, relating to servicing or administration of
certain Mortgage Loans as provided in Section 5.02, in such form as has been
approved by the Trustee, the Certificate Insurer or the Surety.
SURETY: Ambac Assurance Corporation (formerly known as AMBAC
Indemnity Corporation), or any successor thereto, as issuer of the Certificate
Guaranty Surety Bond.
SURETY AGREEMENT: The Surety Bond Reimbursement Agreement dated as of
February 28, 1996 between Merrill Lynch Credit Corporation and the Surety.
TRANSFER: A direct or indirect transfer or other assignment of record
or beneficial interest in a Class R Certificate.
TRUST FUND: The trust created by this Agreement, to the extent
described herein, and entitled "ML Mortgage Loan Trust 1999-A", the corpus of
which consists of (i) the Mortgage Loans, (ii) such assets as shall from time
to time be identified as deposited in the Certificate Account, the Pre-Funding
Account and the Carryover Reserve Fund, (iii) property which secured a
Mortgage Loan and which has been acquired by foreclosure or deed in lieu of
foreclosure, (iv) Standard Hazard Policies and any other insurance policies,
and the proceeds thereof, (v) certain rights of the Company under the Sale
Agreement as more particularly set forth in the last paragraph of Section 2.01
and as described in Sections 2.02 and 3.01 hereof, (vi) such amounts as shall
from time to time be deposited in the Distribution Account, (vii) the
Certificate Insurance Policy, (viii) the Certificate Guaranty Surety Bond,
(ix) each Mortgage 100(sm) Pledge Agreement and (x) each Parent Power(R)
Agreement. The Mortgage 100(sm) Pledge Agreements, the Parent Power(R)
Agreements, the Pre-Funding Account (including the funds therein and
Pre-Funding Earnings) and the Carryover Reserve Fund (including the funds
therein) shall not be part of the two REMICs created by this Agreement.
TRUSTEE: Bankers Trust Company of California, N.A., as trustee, or
its successor in interest or any successor or co-trustee under this Agreement
appointed as herein provided.
UNPAID BASIS RISK CARRYOVER AMOUNT: As to any Distribution Date, the
amount, if any, equal to (a) the aggregate Basis Risk Carryover Amount
distributable on the Class A and/or Class B Certificateholders for such
Distribution Date, minus (b) the aggregate Basis Risk Carryover Amount
distributed to the Class A and/or Class B Certificateholders on such
Distribution Date.
UNRECOVERED PRINCIPAL AMOUNT: As to any Liquidated Mortgage Loan, the
portion, if any, of the principal of such Liquidated Mortgage Loan that was
not recovered at the time such Liquidated Mortgage Loan became a Liquidated
Mortgage Loan. An Unrecovered Principal Amount in respect of a Distribution
Date is one that was incurred in the immediately preceding Principal
Prepayment Period.
UNSCHEDULED FORMULA PRINCIPAL DISTRIBUTION AMOUNT: With respect to
any Distribution Date, the sum of the amounts specified in clauses (b), (c),
(d), (e) and (f) of the Formula Principal Distribution Amount.
UPPER-TIER INTEREST R: The sole class of "residual interest" in the
Upper-Tier REMIC.
UPPER-TIER REMIC: As described in Section 2.05.
Section 1.02. Interest Calculations. Interest on the Class A and
Class B Certificates shall be calculated on the basis of the actual number of
days in the related Accrual Period divided by 360.
[End of Article I]
<PAGE>
ARTICLE II
CONVEYANCE OF MORTGAGE LOANS; TRUST FUND
Section 2.01. Conveyance of Mortgage Loans. The Company, concurrently
with the execution and delivery hereof, does hereby sell, transfer, assign,
set over and convey to the Trustee (for inclusion in the Trust Fund) without
recourse all the right, title and interest of the Company in and to the
Initial Mortgage Loans, including all interest and principal due after the
Cut-off Date on or with respect to the Initial Mortgage Loans (it being
understood that payments of principal and interest first due on the Initial
Mortgage Loans on or before the Cut-off Date shall not be conveyed to the
Trustee pursuant hereto), and each Mortgage 100(sm) Pledge Agreement and each
Parent Power(R) Agreement. The foregoing sale, transfer, assignment, set-over
and conveyance of each Parent Power(R) Agreement that is a Parent Power(R)
Guaranty Agreement for Real Estate does not constitute and is not intended to
result in an assumption by the Trustee or the Trust Fund of any obligation or
liability of MLCC under the related Equity Access(R) Account (as defined in
such Parent Power(R) Agreement). MLCC is authorized to correct any error in
any Mortgage 100(sm) Pledge Agreement or Parent Power(R) Agreement and to
terminate any such agreement and release the related collateral in accordance
with the terms thereof.
In connection with the foregoing conveyance of the Initial Mortgage
Loans, within 60 days after the Closing Date, the Master Servicer, on behalf
of the Company, shall deliver to, and deposit with, the Custodian the
documents or instruments listed in Exhibit B hereto with respect to each
Mortgage Loan so assigned (the requirements for a Mortgage Loan secured by
shares in a cooperative corporation are separately specified in clause (6) of
Exhibit B hereto); provided that prior to the end of such 60 day period, the
Master Servicer shall hold the documents or instruments listed in Exhibit B
hereto with respect to each Mortgage Loan as custodian in trust on behalf of
the Trust Fund for the benefit of the Certificateholders, the Trustee, the
Certificate Insurer and the Surety.
By way of clarification, the remainder of this Section applies to
Subsequent Mortgage Loans as well as the Initial Mortgage Loans.
If in connection with any Mortgage Loan the Master Servicer cannot
deliver the related Mortgage with evidence of recording thereon as provided
above, or within the 180 days permitted in clause (2) of Exhibit B hereto,
solely because of a delay caused by the public recording office to which such
Mortgage has been delivered for recordation, the Master Servicer shall deliver
or cause to be delivered to the Custodian an Officer's Certificate of the
Master Servicer, stating that such Mortgage has been delivered to the
appropriate public recording official for recordation. The Master Servicer
shall promptly deliver or cause to be delivered to the Custodian such Mortgage
with evidence of recording indicated thereon upon receipt thereof from the
public recording official. Notwithstanding the above, the Master Servicer
shall use all reasonable efforts to cause each original Mortgage with evidence
of recording thereon to be delivered to the Custodian within 270 days of the
Closing Date (or the Subsequent Transfer Date in the case of Subsequent
Mortgage Loans).
If the long-term unsecured debt of Merrill Lynch & Co., Inc., if it
is rated by Moody's, is rated below A3 or if it is rated by Standard & Poor's,
is rated below A-, or an Event of Default shall have occurred and is
continuing or if MLCC is no longer the Master Servicer (unless each Rating
Agency confirms that the absence of recordation will not result in the
reduction or withdrawal of its rating of the Class A Certificates), then MLCC
(or the successor Master Servicer in the case of an Event of Default) shall,
within 60 days after such occurrence (unless the long-term unsecured debt of
Merrill Lynch & Co., Inc., if it is rated by Standard & Poor's, is rated below
BBB-, in which case MLCC will have 30 days after such occurrence), cause to be
sent for recording to the appropriate public recording office for real
property records each Assignment of Mortgage referred to in this Section 2.01
except for Mortgage Loans on Mortgaged Properties located in states where, as
evidenced by an opinion of independent counsel acceptable to the Trustee, the
Certificate Insurer, the Surety, the Company and the Rating Agencies, such
recording is not required to protect the interests of the Trustee in the
Mortgage Loan, including the related Mortgage, against the claim of any other
transferee or any successor to or creditor of the Mortgage Loan Seller or the
Originator of such Mortgage Loan. While each Assignment of Mortgage required
to be recorded is being recorded, the Master Servicer shall leave with the
Custodian a photocopy of such Assignment of Mortgage. If any such Assignment
of Mortgage is returned unrecorded to the Master Servicer because of any
defect therein, the Master Servicer shall cause such defect to be cured and
such Assignment of Mortgage to be recorded in accordance with this paragraph.
The Master Servicer shall deliver or cause to be delivered each original
recorded Assignment of Mortgage and intermediate assignment to the Custodian
within 120 days of the occurrence giving rise to the obligation to record or
shall deliver to the Custodian on or before such date an Officer's Certificate
stating that such Assignment of Mortgage has been delivered to the appropriate
public recording office for recordation, but has not been returned solely
because of a delay caused by such recording office. At such time as either
MLCC or the Trustee obtains actual knowledge of the occurrence of an event
that requires the recordation specified in this paragraph, the party obtaining
such knowledge shall promptly give written notice of such event to the other
party and to the Certificate Insurer and the Surety.
If the Master Servicer cannot cause any Mortgage or Assignment of
Mortgage or intermediate assignments, subject to the provisions in this
Section 2.01 regarding recording office delays, to be recorded and evidence of
such recording delivered to the Custodian within 270 days of the occurrence
giving rise to the obligation to record, the Mortgage Loan Seller shall be
required to purchase such Mortgage Loan from the Trustee at the Purchase Price
or the Mortgage Loan Seller shall be required to substitute another Mortgage
Loan for such deficient Mortgage Loan in accordance with the procedures and
subject to the limitations set forth in Section 3.02(i) through (viii), such
repurchase or substitution obligation constituting the sole remedy available
to the Trustee, the Certificateholders, the Certificate Insurer and the Surety
for failure of a Mortgage Loan to be recorded.
With respect to any Additional Collateral Mortgage Loan for which
there has been filed a UCC-1 financing statement in favor of MLCC as secured
party and for which an Assignment of Mortgage is submitted for recording
pursuant to the second preceding paragraph, the Master Servicer shall, within
30 days after such Assignment of Mortgage is submitted for recording, prepare
or cause to be prepared and deliver to the Custodian for filing by the
Custodian in the appropriate recording office a UCC-3 statement giving notice
of the assignment of the related security interest to the Trustee and the
Master Servicer shall thereafter cause the Custodian to file all necessary
continuation statements. To the extent necessary, the Master Servicer shall
cause the Custodian to file any such UCC-3 statement in the appropriate
recording office.
The ownership of each Mortgage Note, the Mortgage and the contents of
the related Mortgage File is vested in the Trustee. Mortgage documents
relating to the Mortgage Loan not delivered to the Trustee or the Custodian
under the Custodial Agreement are and shall be held in trust by the Master
Servicer or any Sub-Servicer, for the benefit of the Trustee as the owner
thereof and the Master Servicer's or such Sub-Servicer's possession of the
contents of each Mortgage File so retained is for the sole purpose of
servicing the related Mortgage Loan, and such retention and possession by the
Master Servicer or such Sub-Servicer is in a custodial capacity only. The
Company agrees to take no action inconsistent with the Trustee's ownership of
the Mortgage Loans, to promptly indicate to all inquiring parties that the
Mortgage Loans have been sold and to claim no ownership interest in the
Mortgage Loans.
It is the intention of this Agreement that the conveyance of the
Company's right, title and interest in and to the Trust Fund pursuant to this
Agreement shall constitute a purchase and sale and not a loan. If the
conveyance of the Mortgage Loans from the Mortgage Loan Seller to the Company
to the Trustee is characterized as a pledge and not a sale, then the Company
shall be deemed to have transferred to the Trustee, in addition to the Trust
Fund, all of the Company's right, title and interest in, to and under the
obligation deemed to be secured by said pledge; and it is the intention of
this Agreement that the Mortgage Loan Seller and the Company shall also be
deemed to have granted to the Trustee a first priority security interest in
all of the Mortgage Loan Seller's and the Company's right, title, and interest
in, to, and under the obligation deemed to be secured by said pledge and that
the Trustee and the Custodian shall be deemed to be an independent custodian
for purposes of perfection of such security interest. If the conveyance of the
Mortgage Loans from the Company to the Trustee 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 Mortgage Loan Seller and
the Company shall be deemed to have granted to the Trustee a first priority
security interest in all of Mortgage Loan Seller's and the Company's 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 Trust Fund, and all proceeds of any
thereof. 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.
In addition to the conveyance of the Initial Mortgage Loans, the
Company does hereby convey, assign and set over to the Trustee all of its
right, title and interest in that portion of the Trust Fund described in items
(ii) through (ix) of the definition thereof and further assigns to the Trustee
for the benefit of the Certificateholders, the Certificate Insurer and the
Surety those representations and warranties of the Mortgage Loan Seller
contained in the Sale Agreement and described in Section 3.01 hereof and the
benefit of the remedies for the breach thereof.
Section 2.02. Acceptance by Trustee. The Trustee acknowledges the
assignment to it of the documents referred to in Section 2.01 above and
acknowledges that upon the Custodian's receipt thereof, pursuant to the
Custodial Agreement, the Custodian will hold such documents and any other
documents constituting a part of the Mortgage Files delivered to the Custodian
in trust for the use and benefit of all present and future Certificateholders,
the Certificate Insurer and the Surety. The Mortgage Loan Seller shall
repurchase at the Purchase Price, or substitute new Mortgage Loans (in
accordance with Section 3.02(i) through (viii)) for, all Mortgage Loans to
which an exception was taken in the Custodian's Interim Certification (as
defined in the Custodial Agreement), within 60 days of the date of delivery of
the Mortgage Files (the "Delivery Date") to the Custodian, unless such
exception is cured to the satisfaction of the Company, the Certificate Insurer
and the Surety within 30 Business Days of the date thereof (or such other
period as is agreed by the Company, the Certificate Insurer and the Surety and
the Trustee but not more than 50 Business Days). Pursuant to the Custodial
Agreement, the Custodian agrees, for the benefit of the Trustee, the
Certificateholders, the Certificate Insurer and the Surety, to review each
Mortgage File delivered to it within 45 days after the Delivery Date to
ascertain that all required documents have been executed and received, and
that such documents relate to the Mortgage Loans, that have been conveyed to
the Trustee. If the Custodian finds any document or documents constituting a
part of a Mortgage File to be missing or defective (that is, mutilated,
damaged, defaced, incomplete, improperly dated, clearly forged or otherwise
physically altered) in any material respect, the Custodian, pursuant to the
Custodial Agreement, shall promptly so notify the Trustee, the Master
Servicer, the Certificate Insurer, the Surety and the Company by delivering
the Interim Certification to them within 45 days after the Delivery Date. The
Mortgage Loan Seller shall correct or cure such omission, defect or other
irregularity within 60 days from the date the Mortgage Loan Seller was
notified of such omission or defect and, if the Mortgage Loan Seller does not
correct or cure such omission or defect within such period, then the Mortgage
Loan Seller, within 90 days from the date the Custodian notified the Mortgage
Loan Seller of such omission or defect, shall either (i) repurchase such
Mortgage Loan from the Trustee at the Purchase Price of such Mortgage Loan or
(ii) substitute a new Mortgage Loan for such deficient Mortgage Loan in
accordance with the provisions of Section 3.02(i) through (viii). The Purchase
Price for the purchased Mortgage Loan shall be paid to the Master Servicer and
deposited by the Master Servicer in the Certificate Account and, upon receipt
by the Trustee and the Custodian of written notification of such deposit
signed by a Servicing Officer, the Custodian, pursuant to the Custodial
Agreement, shall promptly execute and deliver such instruments of transfer or
assignment, without recourse, as shall be necessary to vest in the Mortgage
Loan Seller or its designee, as the case may be, the interest of the Trustee
in any Mortgage Loan released pursuant hereto, and the Trustee shall have no
further responsibility with regard to such Mortgage Loan. It is understood and
agreed that the obligation of the Mortgage Loan Seller to purchase or
substitute for any Mortgage Loan as to which a material defect in or omission
of a constituent document exists shall constitute the sole remedy respecting
such defect or omission available to the Trustee on behalf of
Certificateholders, the Certificate Insurer or the Surety. Notwithstanding
anything herein to the contrary, the Trustee and the Custodian shall be under
no duty or obligation to inspect, review and examine such documents,
instruments, certificates or other papers to determine that they are genuine,
enforceable or appropriate to the represented purpose, or that they have
actually been recorded, or that they are other than what they purport to be on
their face or to determine that all items described in clause (4) of Exhibit B
hereto have been delivered or to determine whether the title policy
affirmatively insures against encroachments as described in clause (5) of
Exhibit B hereto.
The Custodian, pursuant to the Custodial Agreement, shall deliver to
the Company, the Trustee, the Certificate Insurer, the Surety and the Master
Servicer the Interim and Final Certification. If (i) within 90 days of the
Closing Date, the Custodian has not received an Officer's Certificate or a
certificate of the Master Servicer stating that the Mortgage has been
delivered to the appropriate public recording official for recordation or (ii)
if within 270 days of the Closing Date the Custodian finds that any Mortgage
has not been recorded, the Custodian, pursuant to the Custodial Agreement,
shall promptly notify the Trustee, the Certificate Insurer, the Surety and the
Master Servicer and the Master Servicer shall be required, within 30 days of
receipt of such notice, to repurchase such Mortgage Loan or to substitute a
new Mortgage Loan for such deficient Mortgage Loan in accordance with Section
3.02(i) through (viii) hereof.
Section 2.03. Sale and Conveyance of the Subsequent Mortgage Loans.
(a) Subject to the conditions set forth in Sections 2.03 (b), (c), (d) and (e)
below, in consideration of the delivery on the related Subsequent Transfer
Dates to or upon the order of the Company of all or a portion of the balance
of funds in the Pre-Funding Account, the Company shall on any Subsequent
Transfer Date sell, transfer, assign, set over and convey to the Trustee (for
inclusion into the Trust Fund), without recourse (but subject to the
obligations set forth herein) all right, title and interest of the Company in
and to each Subsequent Mortgage Loan listed on the Schedule of Subsequent
Mortgage Loans delivered to the Trustee, the Custodian, the Certificate
Insurer and the Surety on such Subsequent Transfer Date, including its
Principal Balance as of the Subsequent Cut-off Date and all collections of
such principal and all payments of interest in respect of such Subsequent
Mortgage Loans to the extent such collections represent interest accrued from
and including the related Subsequent Transfer Date (interest accruing prior to
such Subsequent Transfer Date being property of the Mortgage Loan Seller) due
after the related Subsequent Cut-off Date and each related Mortgage 100(sm)
Pledge Agreement and each related Parent Power(R) Agreement. The foregoing
sale, transfer, assignment, set over and conveyance of each Parent Power(R)
Agreement that is a Parent Power(R) Guaranty Agreement for Real Estate does
not constitute and is not intended to result in an assumption by the Trustee
or the Trust Fund of any obligation or liability of MLCC under the related
Equity Access(R) Account (as defined in such Parent Power(R) Agreement). MLCC
is authorized to correct any error in any Mortgage 100(sm) Pledge Agreement or
Parent Power(R) Agreement and to terminate any such agreement and release the
related collateral in accordance with the terms thereof. If it is discovered
that any of the conditions set forth in Section 2.03 (b), (c), (d) and (e) has
not been satisfied with respect to a Subsequent Mortgage Loan, then such
failure to satisfy such condition shall be deemed to be a breach of a
representation and warranty in Section 3.01(b) and, if such breach materially
and adversely affects the value of such Subsequent Mortgage Loan or the
interests of the Certificateholders (or materially and adversely affects the
interests of the Certificate Insurer or the Surety in such Subsequent Mortgage
Loans), the Mortgage Loan Seller shall be obligated to repurchase or
substitute for such Subsequent Mortgage Loan in accordance with and subject to
the limitations in Sections 3.01(b) and 3.02, as applicable. If such deemed
breach relates to Mortgage Loans or Subsequent Mortgage Loans in the
aggregate, then the Mortgage Loan Seller shall select such of the Subsequent
Mortgage Loans for purchase or substitution as will result in the satisfaction
of such conditions.
The amount released from the Pre-Funding Account shall be one hundred
percent (100%) of the aggregate Principal Balances as of the applicable
Subsequent Cut-off Date of the Subsequent Mortgage Loans so transferred.
(b) Each of the following conditions shall be satisfied on or prior
to the related Subsequent Transfer Date:
(i) the Master Servicer shall have provided the Trustee and the
Certificate Insurer with a timely Addition Notice and shall have
provided any information reasonably requested by either of the
foregoing with respect to the Subsequent Mortgage Loans;
(ii) the Company shall have executed and delivered a Subsequent
Transfer Agreement with all required schedules and exhibits;
(iii) the Master Servicer shall have deposited or cause to be
deposited in the applicable Certificate Account all collections of
principal in respect of the Subsequent Mortgage Loans received after
the related Subsequent Cut-off Date and all collections of interest
accruing from and after the related Subsequent Transfer Date;
(iv) as of each Subsequent Transfer Date, neither the Company
nor the Master Servicer is insolvent and neither will become
insolvent by such transfer and neither the Company nor the Master
Servicer is aware of any pending insolvency;
(v) such purchase and sale of Subsequent Mortgage Loans will
not result in a material adverse federal income tax consequence to
the Trust Fund or the Holders of the Certificates;
(vi) the Pre-Funding Period shall not have terminated; and
(vii) the Company shall have delivered to the Certificate
Insurer, the Rating Agencies and the Trustee Opinions of Counsel with
respect to the transfer of the Subsequent Mortgage Loans
substantially in the form of the Opinions of Counsel delivered to the
Certificate Insurer, the Rating Agencies and the Trustee on the
Closing Date (bankruptcy, corporate and tax opinions).
(c) In connection with the transfer and assignment of the Subsequent
Mortgage Loans, the Master Servicer shall take the actions set forth in
Section 2.01 and the Trustee (and the Custodian pursuant to the Custodial
Agreement) shall take the actions applicable to it specified in Section 2.02
and the Master Servicer shall be deemed to have made the representations and
warranties set forth in Section 3.01(b), in each case with respect to the
Subsequent Mortgage Loans delivered on a Subsequent Transfer Date, except that
references in said sections to Mortgage Loans, the Closing Date and the
Cut-off Date shall refer to the applicable Subsequent Mortgage Loans,
Subsequent Transfer Date and Subsequent Cut-off Date, respectively. In
connection with such assignment and transfer, within 60 days after the related
Subsequent Transfer Date, the Master Servicer, on behalf of the Company, shall
deliver to, and deposit with, the Custodian the documents or instruments
listed in Exhibit B hereto with respect to each related Subsequent Mortgage
Loan; provided that prior to the end of such 60 day period, the Master
Servicer shall hold the documents or instruments listed in Exhibit B hereto
with respect to each Mortgage Loan as custodian in trust on behalf of the
Trust Fund for the benefit of the Certificateholders, the Trustee, the
Certificate Insurer and the Surety.
(d) As of its Subsequent Cut-off Date, such Subsequent Mortgage Loans
shall satisfy the following criteria:
(i) such Subsequent Mortgage Loan shall not be delinquent in
payment by one or more monthly payments as of the related Subsequent
Cut-off Date;
(ii) the remaining stated term to maturity of each such
Subsequent Mortgage Loan will not be less than 275 months and will
not exceed 301 months ;
(iii) each such Subsequent Mortgage Loan will have a Margin as
described under "MLCC and Its Mortgage Programs" in the Prospectus
Supplement dated December 16, 1999;
(iv) each such Subsequent Mortgage Loan will be underwritten in
accordance with the Master Servicer's underwriting guidelines in
effect at the time of origination;
(v) such Subsequent Mortgage Loan will not have a Loan-to-Value
Ratio greater than 100%; and
(vi) the Subsequent Mortgage Loans will have as of the end of
the Pre-Funding Period, a weighted average term since origination not
in excess of 4 months.
In the sole discretion of the Certificate Insurer, Subsequent Mortgage Loans
not satisfying the requirements set forth above may be purchased by the Trust
Fund; provided, however, that the addition of such Subsequent Mortgage Loans
will not materially affect the aggregate characteristics of the entire
Mortgage Pool.
(e) Following the purchase of any Subsequent Mortgage Loan by the
Trust Fund, the Mortgage Loans (including the Subsequent Mortgage Loans)
shall:
(i) a weighted average original term to stated maturity of not
more than 301 months;
(ii) have a weighted average Constructive Loan-to-Value Ratio
of not more than 67.5%;
(iii) have no Mortgage Loan with a Principal Balance in excess
of $6,500,000 and no more than 55% by aggregate principal balance
will have a Principal Balance in excess of $1,000,000;
(iv) not have a concentration of Mortgaged Properties in a
single zip code in excess of 4.0% by aggregate Principal Balance of
the Mortgage Loans;
(v) a weighted average gross margin of at least 1.875%;
(vi) have at least 84% by aggregate Principal Balance of
Mortgage Loans secured interests in attached or detached single
family dwellings units (including units in de minimis planned unit
developments but excluding condominiums, cooperatives, 2-4 family
residences and planned unit development projects); and
(vii) have a weighted average Mortgage Rate that is not more
than 100 basis points lower than the weighted average Mortgage Rate
of the Initial Mortgage Loans.
Section 2.04. Trust Fund; Authentication of Certificates. Subject to
the provisions of Section 2.01, the Trustee acknowledges and accepts the
assignment to it of the Trust Fund created pursuant to this Agreement in trust
for the use and benefit of all present and future Certificateholders, the
Certificate Insurer and the Surety. The Trustee acknowledges the assignment to
it of the Mortgage Loans, the Mortgage 100(sm) Pledge Agreements and the Parent
Power(R) Agreements and has caused to be authenticated and delivered to or
upon the order of the Company, in exchange therefor, Certificates duly
authenticated by the Trustee in authorized denominations evidencing ownership
of the entire Trust Fund.
Section 2.05. REMIC Elections. The Company hereby directs the Trustee
to sign two initial tax returns to be provided by the Master Servicer which
shall cause the Trust Fund (exclusive of the Mortgage 100(sm) Pledge Agreements,
the Parent Power(R) Agreements, the Pre-Funding Account (including the funds
therein and Pre-Funding Earnings) and the Carryover Reserve Fund (including
the funds therein)) to elect for federal income tax purposes to consist of two
REMICs. This Agreement shall be construed so as to carry out the intention of
this Agreement that the Lower-Tier REMIC shall consist of all of the assets
constituting the Trust Fund (exclusive of the Mortgage 100(sm) Pledge
Agreements, the Parent Power(R) Agreements, the Pre-Funding Account (including
the funds therein and Pre-Funding Earnings) and the Carryover Reserve Fund
(including the funds therein)) and shall be evidenced by the Lower-Tier
Regular Interests (which will be uncertificated and will represent the
"regular interests" in the Lower-Tier REMIC for purposes of the REMIC
Provisions) and the Lower-Tier Interest R (which will represent the single
"residual interest" in the Lower-Tier REMIC for purposes of the REMIC
Provisions). The Trustee shall hold the Lower-Tier Regular Interests. In
addition, the Upper-Tier REMIC at all times prior to the date on which
final payment is made (or made available on demand) to the Holders of any
Class A, Class B and Class C Certificates shall consist of the Lower-Tier
Regular Interests and shall be evidenced by the Class A, Class B and Class C
Certificates (which will represent the "regular interests" in the Upper-Tier
REMIC for purposes of the REMIC Provisions) and the Upper-Tier Interest R
(which will represent the single "residual interest" in the Upper-Tier
REMIC for purposes of the REMIC Provisions). The Class R Certificate shall
represent beneficial ownership of the Lower-Tier Interest R and the
Upper-Tier Interest R. The Closing Date is hereby designated as the
"startup day" of such REMIC within the meaning of Section 860G(a)(9) of the
Code.
The Trustee shall treat the Carryover Reserve Fund as an
outside reserve fund within the meaning of Treasury Regulation 1.860G-2(h)
that is owned by the Class C Certificateholders and that is not an asset of
any REMIC created hereunder. The Trustee shall treat Basis Risk Carryover
Amounts paid to the Class A and Class B Certificateholders as paid first by
the Upper-Tier REMIC to the Class C Certificateholders, deposited by the Class
C Certificateholders into the Carryover Reserve Fund, and then paid to the
Class A and Class B Certificateholders pursuant to an interest rate cap
contract written by the Class C Certificateholder in favor of the Class A and
Class B Certificateholders. Thus, each Class A and Class B Certificate shall
be treated as representing ownership of not only regular interests in the
Upper-Tier REMIC, but also ownership of an interest in an interest rate cap
contract. For purposes of determining the issue price of the regular interests
in the Upper-Tier REMIC, the Trustee shall assume that each interest rate cap
contract has a value of $5,000.
Section 2.06. REMIC Tax Matters. The tax year of the Trust Fund shall
be the calendar year, and the Trust Fund shall use the accrual method of
reporting income and loss.
Section 2.07. REMIC Certificate Maturity Date. All regular interests
in the Lower-Tier and Upper-Tier REMICs created hereby will be retired on or
before the Distribution Date in March 2025.
Section 2.08. Lower-Tier REMIC. Principal of and interest on the
Lower-Tier Regular Interests and the Lower-Tier Interest R shall be allocated
to the Corresponding Class of Certificates in the manner set forth in the
following table:
Corresponding Class of Certificates
<TABLE>
<CAPTION>
Initial Lower-Tier Allocation of Allocation
Lower-Tier Interest Principal Balance Pass-Through Rate Principal(1) of Interest
------------------- ----------------- ----------------- ------------ -----------
<S> <C> <C> <C> <C>
A $689,500,000 (2) Class A Class A and Class C
B $10,500,000 (2) Class B Class B and Class C
R (3) (3) (4) (4)
</TABLE>
- ---------------
(1) The amount of principal allocable from a Lower-Tier Regular Interest to
its Corresponding Class of Certificate on any Distribution Date shall be 100%.
(2) The Lower-Tier Pass-Through Rate for Lower-Tier Interests A and B for any
Distribution Date will be equal to the Alternate Certificate Rate for such
Distribution Date.
(3) The Lower-Tier Interest R will have no Principal Balance and will not bear
interest.
(4) The beneficial ownership of the Lower-Tier Interest R and the Upper-Tier
Interest R will be represented by the Class R Certificate.
[End of Article II]
<PAGE>
ARTICLE III
REPRESENTATIONS AND WARRANTIES OF THE MASTER
SERVICER; REPURCHASE OF MORTGAGE LOANS;
REPRESENTATION AND WARRANTY OF THE COMPANY
Section 3.01. Representations and Warranties of the Master Servicer.
The Master Servicer hereby represents and warrants to the Trustee that on the
Closing Date it has entered into the Sale Agreement, wherein in its capacity
as the Mortgage Loan Seller, the Master Servicer has made the following
representations and warranties, and in its capacity as Master Servicer, hereby
further represents and warrants to the Trustee, the Certificate Insurer, the
Surety and the Company as of the Closing Date, for the Initial Mortgage Loans,
or in the case of the Subsequent Mortgage Loans, the applicable Subsequent
Transfer Date, as follows:
(a) With respect to the Master Servicer in this Section 3.01
and Section 3.02, Master Servicer means both Master Servicer and
Mortgage Loan Seller for as long as the Master Servicer and the
Mortgage Loan Seller are the same Person, and means Mortgage Loan
Seller only when the Mortgage Loan Seller and the Master Servicer are
different Persons:
(i) The Master Servicer is a corporation duly organized,
validly existing and in good standing under the laws of the
State of Delaware and is qualified to transact business in each
state in which any Mortgaged Property is located or is not
required under applicable law from such qualification and no
demand for such qualification has been made upon the Master
Servicer by any such state. The Master Servicer is or will be
in compliance with the laws of any such state to the extent
necessary to ensure the enforceability of each Mortgage Loan
and the servicing of the Mortgage Loans by it in accordance
with the terms of this Agreement;
(ii) The Master Servicer has the full power and authority
to hold each Mortgage Loan, to sell each Mortgage Loan and
execute, deliver and perform, and to enter into and consummate
all transactions contemplated by this Agreement and the Sale
Agreement and to conduct its business as presently conducted,
has duly authorized the execution, delivery and performance of
this Agreement and the Sale Agreement, has duly executed and
delivered this Agreement and the Sale Agreement, and this
Agreement, the Sale Agreement and each Assignment of Mortgage
to the Company constitutes a legal, valid and binding
obligation of the Master Servicer, enforceable against it in
accordance with its terms, except as enforcement of such terms
may be limited by bankruptcy, insolvency or similar laws
affecting the enforcement of creditors' rights generally and by
availability of equitable remedies;
(iii) None of the execution and delivery of this Agreement
or the Sale Agreement, the origination or acquisition of the
Mortgage Loans by the Master Servicer, the sale of the Mortgage
Loans to the Company, the consummation of the transactions
contemplated thereby, or the fulfillment of or compliance with
the terms and conditions of this Agreement or the Sale
Agreement will materially conflict with or result in a material
breach of any of the terms, conditions or provisions of the
Master Servicer's certificate of incorporation or bylaws or any
material legal restriction or any agreement or instrument to
which the Master Servicer is now a party or by which it is
bound, or constitute a material default or result in an
acceleration under any of the foregoing, or result in the
material violation of any law, rule, regulation, order,
judgment or decree to which the Master Servicer or its property
is subject;
(iv) The Master Servicer is an approved conventional
seller/servicer for Fannie Mae or Freddie Mac in good standing;
(v) With respect to each Mortgage Loan, the Master Servicer
is in possession of a complete Mortgage File in compliance with
this Agreement, except for such documents as have been
delivered to the Custodian and except for the Mortgages or
assignments thereof submitted for recordation as set forth in
Section 2.01 hereof;
(vi) Immediately prior to the transfer of the Mortgage
Loans to the Company, the Master Servicer had good title to and
is the sole owner of record of each Mortgage and the
indebtedness evidenced by each Mortgage Note;
(vii) There is no litigation pending or, to the Master
Servicer's knowledge, threatened to which the Master Servicer
is a party and which is reasonably likely to adversely affect
the sale of the Mortgage Loans, the execution, delivery or
enforceability of this Agreement or the Sale Agreement, or the
ability of the Master Servicer to service the Mortgage Loans
under this Agreement in accordance with the terms hereof, or
which is reasonably likely to have a material adverse effect on
the financial condition of the Master Servicer;
(viii) No consent, approval, authorization or order of any
court or governmental agency or body is required for the
execution, delivery and performance by the Master Servicer of
or compliance by the Master Servicer with this Agreement or the
Sale Agreement, the sale of the Mortgage Loans or the
consummation of the transactions contemplated by this Agreement
or the Sale Agreement except for consents, approvals,
authorizations and orders which have been obtained;
(ix) To the best of the Master Servicer's knowledge, the
consummation of the transactions contemplated by this Agreement
and the Sale Agreement is in the ordinary course of business of
the Master Servicer, and the transfer, assignment and
conveyance of the Mortgage Notes and the Mortgages by the
Master Servicer pursuant to this Agreement and the Sale
Agreement are not subject to the bulk transfer or any similar
statutory provisions in effect in any applicable jurisdiction;
(x) The origination, acquisition and collection practices
used by the Master Servicer and, to the best knowledge of the
Master Servicer, by the originator of the Mortgage Loan, with
respect to each Mortgage Note and Mortgage, have been in all
material respects legal and proper and, with respect to
collection practices, customary in the mortgage origination and
servicing business. With respect to escrow deposits and
payments that the Master Servicer collects, to the extent such
payments are in the possession of, or under the control of, the
Master Servicer, there exist no deficiencies in connection
therewith for which customary arrangements for repayment
thereof have not been made. No escrow deposits or other charges
or payments due the Master Servicer have been capitalized under
any Mortgage or the related Mortgage Note;
(xi) No selection procedure believed by the Master Servicer
to be adverse to the interests of Certificateholders was used
in selecting the Mortgage Loans for inclusion in the Trust
Fund;
(xii) No statement, report or other document furnished or
to be furnished on or before the Closing Date by the Master
Servicer pursuant to this Agreement or the Sale Agreement or in
connection with the transactions contemplated hereby or thereby
contains any untrue statement of a material fact or omits to
state a material fact necessary to make the statements
contained therein not misleading;
(xiii) The information supplied to the Company with respect
to the Mortgage Loans, the Master Servicer and the Master
Servicer's loan servicing portfolio, including, but not limited
to, the information contained in the Prospectus Supplement
relating to the offering of the Class A Certificates relating
to the Mortgage Loans and the Master Servicer, particularly the
information under the caption "The Mortgage Pool", is true and
correct in all material respects and does not omit to state a
material fact necessary to make such information, in light of
the circumstances under which given, not misleading; and
(xiv) The Master Servicer will treat the sale of the
Mortgage Loans to the Company as a sale for federal income tax
(to the extent appropriate), reporting and accounting purposes.
(b) With respect to each Mortgage Loan as of the Closing Date
in the case of the Initial Mortgage Loans and the related Subsequent
Transfer Date in the case of the Subsequent Mortgage Loans (unless
another date is specified):
(i) The information set forth in the Mortgage Loan Schedule
is true and correct in all material respects;
(ii) (A) As of the Cut-off Date ( or the related Subsequent
Cut-off Date in the case of a Subsequent Mortgage Loan), (1)
the Mortgage Loan is not delinquent in payment by one or more
Monthly Payments and the Mortgage Loan has not been dishonored
and (2) the Mortgage Loan has never been delinquent in payment
by two or more Monthly Payments and has not more than once
during the twelve months preceding the Cut-off Date (the
Subsequent Cut-off Date in the case of a Subsequent Mortgage
Loan) been delinquent in payment by more than one Monthly
Payment and (B) except as permitted in clause (A)(1) above,
there are no material defaults under the terms of the Mortgage
Loan and the Master Servicer has not advanced funds, or
induced, solicited or knowingly received any advance of funds
from a party other than the owner of the Mortgaged Property
subject to the Mortgage, directly or indirectly, for the
payment of any amount required by the Mortgage Loan;
(iii) To the best of the Master Servicer's knowledge, there
are no delinquent taxes or other outstanding charges affecting
the related Mortgaged Property which would permit a taxing
authority to initiate foreclosure proceedings against the
Mortgaged Property;
(iv) The terms of the Mortgage Note and the Mortgage have
not been impaired, waived, altered or modified in any respect,
except by written instruments contained in the Mortgage File,
the substance of which waiver, alteration or modification is
reflected on the Mortgage Loan Schedule. No Mortgagor has been
released, in whole or in part, except in connection with an
assumption agreement which assumption agreement is part of the
Mortgage File and the terms of which are reflected in the
Mortgage Loan Schedule;
(v) The Mortgagor has not asserted that the Mortgage Note
and the Mortgage are 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 and the Mortgage, or the exercise of any right
thereunder, render 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 to
the best of the Master Servicer's knowledge, no such right of
rescission, set-off, counterclaim or defense has been asserted
by any Person other than the obligor with respect thereto;
(vi) All buildings upon the Mortgaged Property are required
to be insured by a generally acceptable insurer against loss by
fire, hazards of extended coverage and such other hazards as
are customarily included in extended coverage in the area where
the Mortgaged Property is located, pursuant to Standard Hazard
Policies conforming to the requirements of Section 5.16. To the
best knowledge of the Master Servicer, all such Standard Hazard
Policies are in effect. On the date of origination such
Standard Hazard Policies contained a standard mortgagee clause
naming the Master Servicer or the originator of the Mortgage
Loan and their respective successors in interest as mortgagee
and, to the best knowledge of the Master Servicer, such clause
is still in effect and, to the best of the Master Servicer's
knowledge, all premiums due thereon have been paid. If the
Mortgaged Property is located in an area identified in the
Federal Register by the Federal Emergency Management Agency as
having special flood hazards, such Mortgaged Property is
covered by flood insurance. The Mortgage obligates the
Mortgagor thereunder to maintain all such insurance at
Mortgagor's cost and expense, and on the Mortgagor's failure to
do so, authorizes the holder of the Mortgage to maintain such
insurance at Mortgagor's cost and expense and to seek
reimbursement therefor from the Mortgagor;
(vii) At the time of origination of such Mortgage Loan and
thereafter, all requirements of any federal, state or local law
including, without limitation, usury, truth-in-lending, real
estate settlement procedures, consumer credit protection, equal
credit opportunity or disclosure laws required to be complied
with by the Master Servicer as the originator of the Mortgage
Loan and applicable to the Mortgage Loan have been complied
with in all material respects;
(viii) The Mortgage has not been satisfied as of the
Cut-off Date (or the related Subsequent Cut-off Date in the
case of a Subsequent Mortgage Loan), cancelled or subordinated,
in whole, or rescinded, and the Mortgaged Property has not been
released from the lien of the Mortgage, in whole or in part
(except for a release that does not materially impair the
security of the Mortgage Loan or a release the effect of which
is reflected in the Loan-to-Value Ratio for the Mortgage Loan
as set forth in the Mortgage Loan Schedule), nor to the best of
the Master Servicer's knowledge has any instrument been
executed that would effect any such release, cancellation,
subordination or rescission;
(ix) Ownership of the Mortgaged Property is held in fee
simple (except for Mortgage Loans as to which the related land
is held in a leasehold which extends at least five years beyond
the maturity date of the Mortgage Loan). Except as permitted by
the fourth sentence of this Subsection (ix), the Mortgage is a
valid, subsisting and enforceable first lien on the Mortgaged
Property, including all buildings on the Mortgaged Property and
all installations and mechanical, electrical, plumbing, heating
and air conditioning systems affixed to such buildings, and all
additions, alterations and replacements made at any time with
respect to the foregoing securing the Mortgage Note's original
principal balance. The Mortgage and the Mortgage Note do not
contain any evidence on their face of any security interest or
other interest or right thereto. Such lien is free and clear of
all adverse claims, liens and encumbrances having priority over
the first lien of the Mortgage subject only to (1) the lien of
non-delinquent current real property taxes and assessments not
yet due and payable, (2) covenants, conditions and
restrictions, rights of way, easements and other matters of the
public record as of the date of recording which are acceptable
to mortgage lending institutions generally, or which are
specifically referred to in the lender's title insurance policy
delivered to the originator of the Mortgage Loan and either (A)
which are referred to or otherwise considered in the appraisal
made for the originator of the Mortgage Loan, or (B) which do
not in the aggregate adversely affect the Appraised Value of
the Mortgaged Property as set forth in such appraisal, and (3)
other matters to which like properties are commonly subject
which do not in the aggregate materially interfere with the
benefits of the security intended to be provided by the
Mortgage or the use, enjoyment, value or marketability of the
related Mortgaged Property. Any security agreement, chattel
mortgage or equivalent document related to and delivered in
connection with the Mortgage Loan establishes and creates a
valid, subsisting and enforceable first lien and first priority
security interest on the property described therein;
(x) The Mortgage Note is not subject to a third party's
security interest or other rights or interest therein;
(xi) The Mortgage Note and the related Mortgage are genuine
and, to the best of the Master Servicer's knowledge, each is
the legal, valid and binding obligation of the maker thereof,
enforceable in accordance with its terms subject to bankruptcy,
insolvency and other laws of general application affecting the
rights of creditors. To the best of the Master Servicer's
knowledge, all parties to the Mortgage Note and the Mortgage
had the legal capacity to enter into the Mortgage Loan and to
execute and deliver the Mortgage Note and the Mortgage. The
Mortgage Note and the Mortgage have been duly and properly
executed by such parties. The proceeds of the Mortgage Loan
have been fully disbursed and there is no requirement for
future advances thereunder, and 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;
(xii) Immediately prior to the transfer and assignment to
the Company, the Mortgage Note and the Mortgage were not
subject to an assignment or pledge, and the Master Servicer had
full right to transfer and sell the Mortgage Loan to the
Company free and clear of any encumbrance, equity, lien,
pledge, charge, claim or security interest, including, to the
best knowledge of the Master Servicer, any lien, claim or other
interest arising by operation of law;
(xiii) Each Mortgage Loan is covered by an ALTA lender's
title insurance policy or other generally acceptable form of
policy or insurance acceptable to Fannie Mae or Freddie Mac,
issued by a title insurer acceptable to Fannie Mae or Freddie
Mac and qualified to do business in the jurisdiction where the
Mortgaged Property is located, insuring (subject to the
exceptions contained in (ix)(1) and (2) above) the Master
Servicer, its successors and assigns, as to the first priority
lien of the Mortgage in the original principal amount of the
Mortgage Loan. The Master Servicer is the sole insured of such
lender's title insurance policy, such title insurance policy
has been duly and validly endorsed to the Trustee or the
assignment to the Trustee of the Master Servicer's interest
therein does not require the consent of or notification to the
insurer and such lender's title insurance policy is in full
force and effect and will be in full force and effect upon the
consummation of the transactions contemplated by this
Agreement. To the best of the Master Servicer's knowledge, no
claims have been made under such lender's title insurance
policy, and no prior holder of the related Mortgage has done,
by act or omission, anything which would impair the coverage of
such lender's title insurance policy;
(xiv) To the best of the Master Servicer'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 permitting acceleration,
except for any Mortgage Loan payment which is not late by more
than 30 days; and the Master Servicer has not waived any
default, breach, violation or event permitting acceleration;
(xv) To the best of the Master Servicer's knowledge, there
are no mechanics' or similar liens or claims which have been
filed for work, labor or material (and, to the best of the
Master Servicer's knowledge, no rights are outstanding that
under law could give rise to such lien) affecting the related
Mortgaged Property which are or may be liens prior to, or equal
or coordinate with, the lien of the related Mortgage;
(xvi) To the best of the Master Servicer's knowledge, all
improvements subject to the Mortgage lay wholly within the
boundaries and building restriction lines of the Mortgaged
Property (and wholly within the project with respect to a
condominium unit) and no improvements on adjoining properties
encroach upon the Mortgaged Property except those which are
insured against by the title insurance policy referred to in
clause (xiii) above and all improvements on the property comply
with all applicable zoning and subdivision laws and ordinances;
(xvii) Each Mortgage Loan (except for the Mortgage Loans
referred to in the next sentence) was originated by, or closed
in the name of and funded by, the Master Servicer, and at the
time of each such origination the Master Servicer was a
mortgagee approved by the Secretary of Housing and Urban
Development (the "HUD Secretary") pursuant to Sections 203 and
211 of the National Housing Act. Approximately 7.29% of the
Initial Mortgage Loans (by Principal Balance as of the Cut-off
Date) are Correspondent Mortgage Loans. Initial Mortgage Loans
and any Subsequent Mortgage Loans which are Correspondent
Mortgage Loans were originated in the name of a Correspondent
Lender which was a mortgagee approved by the HUD Secretary
pursuant to Sections 203 and 211 of the National Housing Act.
As more fully described in the Prospectus Supplement dated
December 16, 1999 relating to the Class A Certificates, each
Mortgage Loan was underwritten in accordance with the Master
Servicer's underwriting guidelines in effect at the time of
origination. Each Mortgage Loan is an adjustable rate
conventional mortgage loan. Each Mortgage Loan bears interest
at a rate adjusted monthly or semiannually on the relevant
Interest Adjustment Date to a rate (rounded to the nearest
1/8th of 1% or 1/16th of 1%) equal to the applicable Margin
stated therein and shown on the Mortgage Loan Schedule plus the
Index most recently published as of the date 25 days (in the
case of a monthly adjustable Mortgage Loan) or 45 days (in the
case of a semiannually adjustable Mortgage Loan) before the
related Interest Adjustment Date, subject to its Maximum
Mortgage Rate. There is no minimum mortgage rate applicable to
a Mortgage Loan. No Mortgage Loan is subject to a periodic
interest rate cap (exclusive of the effect of usury or similar
laws). Each Mortgage Note is payable in scheduled monthly
installments, with interest payable in arrears. The Monthly
Payment on each Mortgage Loan is adjusted monthly or
semiannually on the relevant Payment Adjustment Date so that
the monthly payment is sufficient, during the first ten years
of the term of the Mortgage Loan, to pay only the interest due
thereon and, thereafter, to fully amortize, without balloon
payments, the then outstanding principal balance over its
remaining term to stated maturity and to pay interest at the
related Mortgage Rate in effect on such Payment Adjustment
Date; provided that if a Convertible Mortgage Loan is converted
to a fixed rate, its Monthly Payment is adjusted to a level
payment that will fully amortize such Mortgage Loan through its
original maturity date. Convertible Mortgage Loans and Index
Convertible Mortgage Loans may be converted to a new Index and
Margin in accordance with the terms of the related Mortgage
Note. The Mortgage contains the usual and customary provision
of the Master Servicer at the time of origination for the
acceleration of the payment of the unpaid Principal Balance of
the Mortgage Loan if the related Mortgaged Property is sold
without the prior consent of the mortgagee thereunder;
(xviii) The Mortgaged Property at origination or
acquisition was and, to the best of the Master Servicer's
knowledge, currently is free of material damage and waste and
in good repair and at origination there was, and to the best of
the Master Servicer's knowledge there currently is, no
proceeding pending for the total or partial condemnation
thereof;
(xix) The related Mortgage contains customary and
enforceable provisions such as to render the rights and
remedies of the holder thereof adequate for the realization
against the Mortgaged Property of the benefits of the security
provided thereby, including, (1) in the case of a Mortgage
designated as a deed of trust, by trustee's sale or judicial
foreclosure, and (2) otherwise by judicial foreclosure. The
Master Servicer has no knowledge of any homestead or other
exemption available to the Mortgagor which would interfere with
the right to sell the Mortgaged Property at a trustee's sale or
the right to foreclose the Mortgage;
(xx) If the Mortgage constitutes a deed of trust, a
trustee, duly qualified if required under applicable law to act
as such, has been properly designated and currently so serves
and is named in the Mortgage (except in the case of one (1)
Mortgage Loan with a Cut-off Date Principal Balance of $350,000
or less that is located in a state in which any purported
non-qualification of the trustee does not affect the validity
or enforceability of such loan), and no fees or expenses are or
will become payable by the Trustee to the trustee under the
deed of trust, except in connection with a trustee's sale or
attempted sale after default by the Mortgagor;
(xxi) With respect to each Mortgage Loan, there is an
appraisal on a Fannie Mae-approved form (or a narrative
residential appraisal) of the related Mortgaged Property signed
prior to the approval of such Mortgage Loan application by a
qualified appraiser, appointed by the Master Servicer or the
originator of such Mortgage Loan, as appropriate, who has no
interest, direct or indirect, in the Mortgaged Property or in
any loan made on the security thereof, and whose compensation
is not affected by the approval or disapproval of such Mortgage
Loan;
(xxii) The Master Servicer has no knowledge of any
circumstances or condition with respect to the Mortgage, the
Mortgaged Property, the Mortgagor or the Mortgager's credit
standing that can reasonably be expected to cause investors to
regard the Mortgage Loan as an unacceptable investment, cause
the Mortgage Loan to become delinquent, or adversely affect the
value or marketability of the Mortgage Loan;
(xxiii) Each Mortgage Loan has a Loan-to-Value Ratio that
is not greater than 100%, and has not been significantly
modified within the meaning of Treasury Regulation Section
1.860G-2(h);
(xxiv) The Initial Mortgage Loans were originated from
January 28, 1997 through November 22, 1999. At origination all
Initial Mortgage Loans had a term to stated maturity of 25
years;
(xxv) No Mortgage Loan contains "subsidized buydown" or
"graduated payment" features;
(xxvi) Before giving effect to any exercise of the option
in an Index Convertible Mortgage Loan or a Convertible Mortgage
Loan to convert to a new Index, the Margins on the Initial
Mortgage Loans (A) in the case of the Prime Index Mortgage
Loans, generally range from -0.750% to 0.250% (B) in the case
of the Six-Month LIBOR Index Mortgage Loans, generally range
from 0.875% to 2.875%, (C) in the case of One-Month LIBOR Index
Mortgage Loans, generally range from 1.000% to 3.250%, and (D)
in the case of Treasury Index Mortgage Loans, generally range
from 0.875% to 3.125%;
(xxvii) No more than 3.33% of the Initial Mortgage Loans,
by Cut-off Date Principal Balances, are, as of the Cut-off
Date, secured by Mortgaged Properties located in the same zip
code area;
(xxviii) The Mortgaged Property is a single-family (one- to
four-unit) dwelling residence erected thereon, or a two- to
four-family residence erected thereon, or an individual
condominium unit in a condominium, or an individual unit in a
planned unit development project or in a de minimis planned
unit development, or the Mortgage Loan is secured by a security
interest in cooperative shares and a lease or other arrangement
in respect of a cooperative apartment. No such residence is a
mobile home or a manufactured dwelling which is not permanently
attached to the land. If the Mortgage Loan was originated in
the Mortgage Loan Seller's construction to permanent financing
program, construction of the related dwelling residence is
complete;
(xxix) Based on representations of the related mortgagors,
approximately 79.03% of the Initial Mortgage Loans (measured by
aggregate Principal Balance) represent loans for primary
residences, 17.86% represent loans for secondary vacation
residences and 3.11% represent loans for investment properties;
(xxx) The Mortgage Rates borne by the Initial Mortgage
Loans as of the Cut-off Date ranged from 5.941% per annum to
9.000% per annum;
(xxxi) The original principal balances of the Initial
Mortgage Loans ranged from $26,250 to $6,449,328. The maximum
outstanding principal balance of any Initial Mortgage Loan as
of the Cut-off Date was $6,449,328.
(xxxii) No more than 46.02% of the Initial Mortgage Loans
by Principal Balance as of the Cut-off Date are Additional
Collateral Mortgage Loans; and as of the Cut-off Date (or the
related Subsequent Cut-off Date in the case of a Subsequent
Mortgage Loan) each such Additional Collateral Mortgage Loan
had the benefit of Additional Collateral at least equal to the
Original Additional Collateral Requirement for such Mortgage
Loan; and
(xxxiii) 4.97% of the Initial Mortgage Loans (by Cut-off
Date Principal Balance) were originated under programs by which
the related Mortgagors were not required to disclose their
income; and 1.60% of the Initial Mortgage Loans (by Cut-off
Date Principal Balance) were originated under programs by which
the related Mortgagors disclosed their income to MLCC, but MLCC
did not verify their income.
The Company, as assignee of the Master Servicer under this Agreement
and the Sale Agreement, hereby assigns to the Trustee for the benefit of the
Certificateholders, the Certificate Insurer and the Surety all of its right,
title and interest in respect of the Sale Agreement insofar as such Agreements
relate to the representations and warranties set forth in this Section 3.01.
The representations and warranties set forth in this Section 3.01
shall survive the delivery of the respective Mortgage Files to the Custodian
on behalf of the Trustee. With respect to the representations and warranties
described in this Section which are made to the best of the Master Servicer's
knowledge, if it is discovered by any of the Company, the Master Servicer, the
Certificate Insurer, the Surety or the Trustee that the substance of such
representation and warranty is inaccurate, then notwithstanding the Master
Servicer's lack of knowledge with respect to the substance of such
representation and warranty being inaccurate at the time the representation or
warranty was made, such inaccuracy shall be deemed a breach of the applicable
representation or warranty. Upon discovery by either the Company, the Master
Servicer, the Certificate Insurer, the Surety or the Trustee of a breach of
any of the foregoing representations and warranties which materially and
adversely affects the value of a Mortgage Loan or the interest of the
Certificateholders (or which materially and adversely affects the interests of
the Certificateholders, the Certificate Insurer or the Surety in the related
Mortgage Loan in the case of a representation and warranty relating to a
particular Mortgage Loan), the party discovering such breach shall give prompt
written notice to the other parties and to the Certificate Insurer and the
Surety. The Company shall promptly (and in any event within no more than five
Business Days) request that the Master Servicer cure such breach. The Master
Servicer shall within 90 days from the date the Master Servicer was notified
of or otherwise discovers such breach cure such breach in all material
respects, substitute a Mortgage Loan pursuant to the provisions of Section
3.02 or purchase such Mortgage Loan from the Trustee at the Purchase Price.
The Company shall send a copy of such notice to the Trustee, the Certificate
Insurer and to the Surety. The Purchase Price for the purchased Mortgage Loan
shall be deposited by the Master Servicer in the Certificate Account and, upon
receipt by the Trustee of written notification of such deposit in the form of
an Officer's Certificate signed by a Servicing Officer, the Trustee shall
promptly authorize the Custodian, upon its receipt of a request for release of
documents from the Master Servicer, to release to the Master Servicer the
related Mortgage File and execute and deliver such endorsements, instruments
of transfer or assignment, without recourse, as shall be necessary to vest in
the Master Servicer or its designee, any interest of the Trustee in any
Mortgage Loan released pursuant hereto, and the Trustee shall have no further
responsibility with regard to such Mortgage Loan. It is understood and agreed
that the obligation of the Master Servicer to purchase or substitute for any
Mortgage Loan as to which such a breach has occurred and is continuing shall
constitute the sole remedy respecting such breach available to
Certificateholders or the Trustee on behalf of Certificateholders, the
Certificate Insurer or the Surety.
Section 3.02. Option to Substitute. Subject to Section 5.28(b), if
the Master Servicer is required to repurchase any Mortgage Loan pursuant to
Section 2.02 or 3.01, then within the period of time specified in each such
Section, the Master Servicer may, at its option, but only during the
applicable specified period, remove such deficient Mortgage Loan from the
terms of this Agreement and substitute another mortgage loan for such
deficient Mortgage Loan, in lieu of repurchasing such deficient Mortgage Loan.
Any substitute Mortgage Loan shall (i) have a Principal Balance at the time of
substitution not in excess of the Principal Balance of the deficient Mortgage
Loan (the amount of any difference being deemed to be a Principal Prepayment
to be credited to or deposited in the Certificate Account by the Master
Servicer), (ii) have a Mortgage Rate not less than the Mortgage Rate of the
deficient Mortgage Loan, and not more than one percentage point greater than
the Mortgage Rate of the deficient Mortgage Loan, (iii) bear interest based on
the same Index, have a Margin (assuming the Margin is subtracted from the
Index to arrive at the Mortgage Rate) that is not greater than the Margin of
the deficient Mortgage Loan, have a Margin (assuming the Margin is added to
the Index) that is not less than the Margin of the deficient Mortgage Loan and
have the same frequency for adjustment of the Mortgage Rate and Monthly
Payment, (iv) have a remaining maturity not later than, and not more than one
year earlier than, the remaining maturity of the deficient Mortgage Loan, (v)
be, in the reasonable determination of the Master Servicer, of the same type,
quality and character as the deficient Mortgage Loan as if the breach had not
occurred, (vi) have a Loan-to-Value Ratio not more than that of the deficient
Mortgage Loan, (vii) be in compliance with the representations and warranties
contained in Section 3.01 as of the date of substitution (including the
representation and warranties in Section 3.01(b)) and (viii) not be an
Additional Collateral Mortgage Loan unless the deficient Mortgage Loan is an
Additional Collateral Mortgage Loan. If the Principal Balance of the
substitute Mortgage Loan is less than the Principal Balance of the deficient
Mortgage Loan, the Master Servicer shall deposit such differential amount in
the Certificate Account, which amount shall be deemed to be a Principal
Prepayment. Notwithstanding anything in this Agreement to the contrary, the
Master Servicer shall not substitute a mortgage loan for a deficient Mortgage
Loan at any time after two years after the Closing Date.
The Master Servicer shall amend the Mortgage Loan Schedule to reflect
the withdrawal of the deficient Mortgage Loan from this Agreement and the
substitution of such substitute Mortgage Loan therefor. Upon such amendment,
the Master Servicer shall be deemed to have made as to such substitute
Mortgage Loan the representations and warranties set forth in Section 3.01 as
of the date of such substitution and to have represented and warranted that
such substitute Mortgage Loan satisfies the requirements of this Section 3.02.
Section 3.03. Representation and Warranty of the Company. The Company
represents and warrants that it has transferred to the Trustee (for inclusion
in the Trust Fund) each Mortgage Loan free of any liens, claims, charges or
other encumbrances created by the Company and there has been no other sale or
assignment thereof by the Company.
Section 3.04. Index Convertible Mortgage Loans and Convertible
Mortgage Loans; Certain Procedures and Purchases. (a) The Master Servicer
shall determine the fixed interest rates or new Index and Margin, as
applicable, into which Mortgagors under Index Convertible Mortgage Loans and
Convertible Mortgage Loans may convert the adjustable interest rates on their
Mortgage Notes in accordance with the terms thereof. The Master Servicer
agrees to make such determinations and otherwise administer the program
contemplated in the Mortgage Notes for the Index Convertible Mortgage Loans
until the last date on which Mortgagors have the option to convert the
adjustable interest rates on their Mortgage Notes to new Indices and related
Margins. The Master Servicer agrees to make such determinations and otherwise
administer the program contemplated in the Mortgage Notes for the Convertible
Mortgage Loans until the later to occur of (i) the date on which all the
Convertible Mortgage Loans have become fixed rate Mortgage Loans and (ii) the
last date on which Mortgagors have the option to convert the adjustable
interest rates on their Mortgage Notes to fixed interest rates or new Indices
and related Margins. In addition, the Master Servicer agrees to comply with
the provisions of the Mortgage Notes to service the Index Convertible Mortgage
Loans and the Convertible Mortgage Loans in accordance with the terms of the
related Mortgage Notes.
(b) Upon receiving notice of the conversion of any Convertible
Mortgage Loan to a fixed interest rate, the Master Servicer will promptly
notify the Trustee (if it holds the related Mortgage File) or the Custodian.
Subject to Section 3.04(f), prior to the day on which a Convertible Mortgage
Loan has become a fixed rate Mortgage Loan, the Master Servicer shall be
obligated to purchase such Converting Mortgage Loan at the Conversion Price.
All amounts paid by the Master Servicer in connection with the purchase of a
Converting Mortgage Loan or Converted Mortgage Loan, as the case may be, will
be deposited in the Certificate Account. The Master Servicer shall not be
obligated under this Section to purchase a Mortgage Loan that converts to a
different Index.
(c) Notwithstanding that a Mortgage Loan becomes a Converting
Mortgage Loan in any month, such Converting Mortgage Loan shall remain in the
Trust Fund and all payments in respect thereof shall remain in the Trust Fund
unless and until, if the Master Servicer is obligated to purchase such
Converting Mortgage Loan, such Converting Mortgage Loan is purchased by the
Master Servicer pursuant to Section 3.04(b).
(d) In the event that any Converting Mortgage Loan is not purchased
as provided in Section 3.04(b), the amount of the conversion fee, if any, paid
by the Mortgagor in connection with the conversion of the adjustable rate on
such Converting Mortgage Loan into a fixed rate or a different Index shall be
deposited by the Master Servicer into the Certificate Account on the Business
Day immediately preceding the Distribution Date on which the proceeds of the
purchase of such Converting Mortgage Loan were to be distributed to
Certificateholders. The obligation of the Master Servicer to deposit the
amounts, if any, required by this subsection (d) shall not limit or affect any
purchase under subsection (b) above.
(e) Upon any purchase of a Converting Mortgage Loan by the Master
Servicer pursuant to Section 3.04(b) and the deposit in the Certificate
Account of the Conversion Price, the Master Servicer shall give the Trustee
written notice thereof and, based thereon, the Trustee shall release, or cause
any Custodian to release, the related Mortgage File and convey such Mortgage
Loan to the Master Servicer whereupon such purchased Converting Mortgage Loan
shall cease to be part of the Trust Fund.
(f) If a Master Servicer's duties as Master Servicer are terminated
pursuant to Section 9.01, Section 8.04 or the third paragraph of Section 8.02,
then such Master Servicer shall not be obligated to purchase any Mortgage Loan
that becomes a Converting Mortgage Loan after such termination. A successor
Master Servicer (including, without limitation, the Trustee as a successor
Master Servicer ) shall not be obligated to purchase Convertible Mortgage
Loans that become Converting Mortgage Loans pursuant to Section 3.04(b)
unless, upon becoming a successor Master Servicer, such successor Master
Servicer elects in its sole discretion, by giving written notice of such
election to the Trustee at or about the time of its succession, to be
obligated to make such purchases.
[End of Article III]
<PAGE>
ARTICLE IV
THE CERTIFICATES
Section 4.01. The Certificates. The Class A Certificates, Class B
Certificates, Class C Certificates and Class R Certificate shall be
substantially in the forms annexed hereto as Exhibits C, D, E and F,
respectively, and shall, on original issue, be executed and authenticated by
the Trustee upon the assignment to the Trustee of the documents specified in
Section 2.01, and delivered to or upon the order of the Company. The Class A
and Class B Certificates shall be issuable in the minimum original dollar
denominations (and integral multiples of approximately $1,000 in excess of
such amount, except for one Certificate for each Class representing the
balance of such Class) and aggregate original dollar denominations per Class
as set forth in the following table:
Aggregate
Minimum Approximate Original
Original Denominations of all
Class Denomination Certificates of Class
----- ------------- ------------------------
A $ 25,000 $689,500,000
B $500,000 $10,500,000
So long as the Class A Certificates are Book-Entry Certificates, the
Class A Certificates that are Book-Entry Certificates shall be evidenced by
one or more certificates representing Class A Certificates in denominations
acceptable to the Depository. Beneficial ownership of the Class A Certificates
that are Book-Entry Certificates may be held in minimum dollar denominations
of $25,000 and integral multiples of $1,000 in excess thereof. The minimum
Percentage Interest for a Class C or Class R Certificate shall be 20%.
The Certificates shall be signed by manual or facsimile signature on
behalf of the Trustee by one of its officers. Certificates bearing the manual
or facsimile signatures of individuals who were at the time of signature
proper 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
authentication and delivery of such Certificate or did not hold such offices
at the date of such Certificates. No Certificate shall be entitled to any
benefit under this Agreement, or be valid for any purpose, unless there
appears on such Certificate a manual authentication by an authorized officer
of the Trustee and such authentication upon any Certificate shall be
conclusive evidence, and the only evidence, that such Certificate has been
duly authenticated and delivered hereunder. All Certificates shall be dated
the date of their authentication.
The rights of the Certificateholders to receive payments with respect
to the Trust Fund in respect of the Certificates, and all ownership interests
of the Certificateholders in such payments, shall be as set forth in this
Agreement.
Section 4.02. Registration of Transfer and Exchange of Certificates.
(a) The Trustee shall cause to be kept at its Corporate Trust Office, or at
the office of its designated agent, a Certificate Register in which, subject
to such reasonable regulations as it may prescribe, the Trustee shall provide
for the registration of Certificates and of transfers and exchanges of
Certificates as herein provided.
(b) Subject to Section 4.02(c), upon surrender for registration of
transfer of any Certificate at any office or agency of the Trustee maintained
for such purpose, the Company shall execute and the Trustee shall authenticate
and deliver, in the name of the designated transferee or transferees, a
Certificate or Certificates of a like Class and aggregate denomination and
dated the date of authentication by the Trustee.
(c) No transfer of a Class B, Class C or Class R Certificate shall be
made unless such transfer is made pursuant to an effective registration
statement or in accordance with an exemption from the requirements under the
Securities Act of 1933, as amended (the "Act"). If such a transfer is to be
made in reliance upon an exemption from the Act, (i) the Trustee shall, if not
otherwise directed by the Company, require a written Opinion of Counsel
acceptable to and in form and substance satisfactory to the Company that such
transfer may be made pursuant to an exemption, describing the applicable
exemption and the basis therefor, from the Act or is being made pursuant to
the Act, which Opinion of Counsel shall not be an expense of the Trustee, the
Company or the Master Servicer, and (ii) the Trustee shall require the
transferee to execute a certification, substantially in the form of Exhibit L
hereto, acceptable to and in form and substance satisfactory to the Company
and the Trustee setting forth the facts surrounding such transfer; provided
that such Opinion of Counsel shall not be required in the case of transfers by
or to Merrill Lynch, Pierce, Fenner & Smith Incorporated or an Affiliate. Such
Opinion of Counsel and certification shall not be an expense of the Trustee,
the Company or the Master Servicer. The Trustee, the Master Servicer and the
Company may, without the consent of any Certificateholder, add provisions
(which shall include a form of certificate to be attached hereto as an exhibit
that must be delivered by the proposed transferee) to this Section 4.02(c) to
permit transfers pursuant to Rule 144A of the Securities and Exchange
Commission, in which case transfers pursuant to such provisions shall not
require an Opinion of Counsel.
(d) No transfer (exclusive of any transfer to a Depository or a
securitization trustee) of a Class B, Class C or Class R Certificate shall be
made unless the Trustee shall have received either (i) a representation letter
(substantially in the form attached hereto as Exhibit N) from the transferee
of such Certificate, acceptable to and in form and substance satisfactory to
the Trustee and the Company, to the effect that such transferee is not an
employee benefit plan or other retirement plan or arrangement subject to
Section 406 of ERISA or Section 4975 of the Code, nor a Person acting on
behalf of any such plan or arrangement or acquiring such Certificate with
funds of such a plan or arrangement (including without limitation any
insurance company using funds that may constitute "plan assets"), which
representation letter shall not be an expense of the Trustee, the Company or
the Master Servicer, or (ii) in the case of any such Certificate presented for
registration in the name of an employee benefit plan or other retirement plan
or arrangement subject to ERISA or Section 4975 of the Code (or comparable
provisions of any subsequent enactments), or a trustee of any such plan or
arrangement, an Opinion of Counsel satisfactory to the Trustee and the Company
to the effect that the purchase or holding of such Certificate is permissible
under applicable law, will not constitute or result in a non-exempt prohibited
transaction under ERISA or Section 4975 of the Code and will not subject the
Trustee, the Company or the Master Servicer to any obligation in addition to
those undertaken in this Agreement, which Opinion of Counsel shall not be an
expense of the Trustee, the Company or the Master Servicer. During the
Pre-Funding Period, each Certificate Owner shall be deemed to have made the
representation in clause (i) of this paragraph.
(e) At the option of the Certificateholder, a Certificate may be
exchanged for another Certificate or Certificates of authorized denominations
of a like Class and Percentage Interest, upon surrender of the Certificate to
be exchanged at any office or agency of the Trustee maintained for such
purpose. Whenever a Certificate is so surrendered for exchange, the Company
shall execute and the Trustee shall authenticate and deliver, the Certificate
which the Certificateholder making the exchange is entitled to receive. Every
Certificate presented or surrendered for transfer or exchange shall (if so
required by the Trustee) be duly endorsed by, or be accompanied by a written
instrument of transfer in the form satisfactory to the Trustee duly executed
by, the Holder thereof or his attorney duly authorized in writing.
(f) No service charge shall be made to the Holder for any transfer or
exchange of the Certificate, but the Trustee may require payment by the
affected Certificateholders of a sum sufficient to cover any tax or
governmental charge that may be imposed in connection with any transfer or
exchange of the Certificate.
(g) All Certificates surrendered for transfer and exchange shall be
cancelled and retained or destroyed by the Trustee in accordance with its
standard procedures.
(h) Notwithstanding anything to the contrary contained herein, unless
and until the Company shall have received an Independent Opinion of Counsel,
satisfactory in form and substance to the Company, to the effect that the
absence of the transfer restrictions contained in this Section 4.02(h) would
not result in the imposition of federal income tax upon the Trust Fund or
cause the Trust Fund (exclusive of the Mortgage 100(sm) Pledge Agreements, the
Parent Power(R) Agreements, the Pre-Funding Account (including the funds
therein and Pre-Funding Earnings) and the Carryover Reserve Fund (including
the funds therein)) to fail to qualify as two REMICs, no transfer, sale or
other disposition of the Class R Certificate (including a beneficial interest
therein) may be made without the express written consent to be granted in the
sole discretion of the Master Servicer and the Trustee.
(i) As a condition to the granting of the consent referred to in
Section 4.02(h), prior to the transfer, sale or other disposition of the Class
R Certificate, the Master Servicer shall require that the proposed transferee
deliver to the Master Servicer and the Trustee an affidavit stating that as of
the date of such transfer (i) such transferee is not and has no intention of
becoming either (A) the United States, any state or political subdivision
thereof, any foreign government, any international organization, or any agency
or instrumentality of any of the foregoing (other than an instrumentality that
is a corporation all of whose activities are subject to tax under the Code
and, except in the case of the Federal Home Loan Mortgage Corporation, a
majority of the board of directors of which corporation is not selected by the
United States, any state or political subdivision thereof), (B) any
organization that is exempt from any tax imposed by Chapter 1 of Subtitle A of
the Code, other than (x) a tax-exempt farmers' cooperative within the meaning
of section 521 of the Code or (y) an organization that is subject to the tax
imposed by section 511 of the Code on "unrelated business income" or (C) a
corporation operating on a cooperative basis that is engaged in furnishing
electric energy or providing telephone service to persons in rural areas
(within the meaning of section 1381(a)(2)(C) of the Code) (any Person
described in (A), (B), or (C) being referred to herein as a "Disqualified
Organization"), (ii) such transferee is not acquiring such Certificates as an
agent, broker, nominee, or middleman for a Disqualified Organization and (iii)
such transferee is not a Non-U.S. Person. The Master Servicer and a
Responsible Officer of the Trustee shall not grant the consent referred to in
Section 4.02(h) if either has actual knowledge that any statement made in the
affidavit issued pursuant to the preceding sentence is not true.
Notwithstanding any transfer, sale or other disposition of such Certificates
to a Disqualified Organization or Non-U.S. Person, such transfer, sale or
other disposition shall be deemed to be of no legal force or effect whatsoever
and such Disqualified Organization or Non-U.S. Person shall not be deemed to
be a Holder of such Certificates for any purpose hereunder, including, but not
limited to, the receipt of distributions on such Certificates. If any
purported transfer shall be in violation of the provisions of Section 4.02(h),
then the prior Holder of such Certificates shall, upon discovery that the
transfer of such Certificates was not in fact permitted in Section 4.02(h), be
restored to all rights as a Holder thereof retroactive to the date of the
purported transfer of such Certificates. The Trustee and the Master Servicer
shall be under no liability to any Person for any registration or transfer of
a Class R Certificate that is not permitted by Section 4.02(h) or for making
payments due on any such Certificate to the purported Holder thereof or taking
any other action with respect to such purported Holder under the provisions of
this Agreement so long as the transfer was registered under the written
certification of the Master Servicer as described in Section 4.02(h). The
prior Holder shall be entitled to recover from any purported Holder of any
such Certificate that was in fact not a permitted transferee under Section
4.02(h) at the time it became a Holder all payments made on such Certificate;
provided that neither the Master Servicer nor the Trustee shall be responsible
for such recovery. Each such Certificateholder, by the acceptance of a Class R
Certificate, shall be deemed for all purposes to have consented to the
provisions of Section 4.02(h) and to any amendment of this Agreement deemed
necessary by counsel of the Master Servicer, as evidenced by an Opinion of
Counsel, to ensure that either such Certificate is not transferred to a
Disqualified Organization or Non-U.S. Person and that any transfer of such
Certificate will not cause the imposition of a tax upon the Trust Fund or
cause the Trust Fund (exclusive of the Mortgage 100(sm) Pledge Agreements, the
Parent Power(R) Agreements, the Pre-Funding Account (including the funds
therein and Pre-Funding Earnings) and the Carryover Reserve Fund (including
the funds therein)) to fail to qualify as two REMICs. The restrictions on
transfer of either such Certificate will cease to apply and be void upon
receipt by the Trustee of the Opinion of Counsel as described in Section
4.02(h) or shall be modified as indicated in such Opinion of Counsel. If any
Person that is not permitted to acquire any beneficial interest in a Class R
Certificate under this Section 4.02(i) acquires any beneficial interest in a
Class R Certificate in violation of the restrictions in this Section 4.02(i),
then the Trustee, based on information provided to it by the Master Servicer,
will provide to the Internal Revenue Service, and to the persons specified in
Section 860E(e)(3) and (6) of the Code, information needed to compute the tax
imposed under Section 860E(e)(5) of the Code on transfers of residual
interests to disqualified organizations.
(j) Notice of the transfer of any Class B or Class C Certificate
shall be given to the Rating Agency by the Trustee.
(k) Except as provided in paragraph (l) below, the Book-Entry
Certificates shall at all times remain registered in the name of the
Depository or its nominee and at all times: (i) registration of the Class A
Certificates may not be transferred by the Trustee except to another
Depository; (ii) the Depository shall maintain book-entry records with respect
to the Certificate Owners and with respect to ownership and transfers of such
Class A Certificates; (iii) ownership and transfers of registration of the
Class A Certificates on the books of the Depository shall be governed by
applicable rules established by the Depository; (iv) the Depository may
collect its usual and customary fees, charges and expenses from its Depository
Participants; (v) the Trustee shall deal with the Depository, Depository
Participants and indirect participating firms as representatives of the
Certificate Owners of the Class A Certificates for purposes of exercising the
rights of Holders under this Agreement, and requests and directions for and
votes of such representatives shall not be deemed to be inconsistent if they
are made with respect to different Certificate Owners; and (vi) the Trustee
may rely and shall be fully protected in relying upon information furnished by
the Depository with respect to its Depository Participants and furnished by
the Depository Participants with respect to indirect participating firms and
persons shown on the books of such indirect participating firms as direct or
indirect Certificate Owners.
All transfers by Certificate Owners of Book-Entry Certificates shall
be made in accordance with the procedures established by the Depository
Participant or brokerage firm representing such B Certificate Owner. Each
Depository Participant shall only transfer Book-Entry Certificates of
Certificate Owners it represents or of brokerage firms for which it acts as
agent in accordance with the Depository's normal procedures.
(l) If (x)(i) the Depository or the Company advises the Trustee in
writing that the Depository is no longer willing or able to properly discharge
its responsibilities as Depository, and (ii) the Company is unable to locate a
qualified successor, (y) the Company at its option advises the Trustee in
writing that it elects to terminate the book-entry system through the
Depository or (z) after the occurrence of an Event of Default, Certificate
Owners representing at least 50% of the principal balance of the Class A
Certificates and the Certificate Insurer and the Surety together advise the
Trustee and the Depository through the Depository Participants in writing that
the continuation of a book-entry system through the Depository is no longer in
the best interests of such Certificate Owners and the Certificate Insurer and
the Surety, as applicable, the Trustee shall notify all Certificate Owners of
such Class, through the Depository, of the occurrence of any such event and of
the availability of definitive, fully registered Class A Certificates (the
"Definitive Certificates"), as applicable, to Certificate Owners requesting
the same. Upon surrender to the Trustee of the Class A Certificates by the
Depository, accompanied by registration instructions from the Depository for
registration, the Trustee shall issue the Definitive Certificates. Neither the
Master Servicer, the Company 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. The Master Servicer shall provide
the Trustee with an adequate inventory of certificates to facilitate the
issuance and transfer of Definitive Certificates. Upon the issuance of
Definitive Certificates all applicable references herein to obligations
imposed upon or to be performed by the Depository shall be deemed to be
imposed upon and performed by the Trustee, to the extent applicable with
respect to such Definitive Certificates and the Trustee shall recognize the
Holders of the Definitive Certificates as Certificateholders hereunder. In
addition, the Class A Certificates shall be in the form of Definitive
Certificates up to the time the Class A Certificates are transferred to public
investors.
Section 4.03. Mutilated, Destroyed, Lost or Stolen Certificates. If
(a) any mutilated Certificate is surrendered to the Trustee or the Trustee
receives evidence to its satisfaction of the destruction, loss or theft of any
Certificate, and (b) there is delivered to the Trustee such security or
indemnity as may be required by it to save it harmless, then, in the absence
of notice to the Trustee that such Certificate has been acquired by a bona
fide purchaser, the Trustee shall 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 Class. Upon the issuance of any new Certificate
under this Section, the Trustee may require of the Certificateholder 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 replacement Certificate of any Class issued pursuant to this Section shall
constitute complete and indefeasible evidence of ownership of the Percentage
Interest in the distributions to which the Certificateholders of such Class
are entitled, as if originally issued, whether or not the mutilated,
destroyed, lost or stolen Certificate shall be found at any time, and such
mutilated, destroyed, lost or stolen Certificate shall be of no force or
effect under this Agreement.
Section 4.04. Persons Deemed Owners. The Company, the Master
Servicer, the Certificate Insurer, the Surety and the Trustee may treat the
Person in whose name any Certificate is registered as the owner of such
Certificate and the Percentage Interest in the distributions to the
Certificateholders of such Class are entitled, for the purpose of receiving
remittances pursuant to Section 6.01 and for all other purposes whatsoever,
and neither the Company, the Master Servicer, the Certificate Insurer, the
Surety nor the Trustee shall be affected by notice to the contrary.
Section 4.05. Appointment of Paying Agent. The Master Servicer may
appoint a Paying Agent hereunder. In the event of any such appointment, no
later than 12:00 noon New York City time, on the Business Day preceding each
Distribution Date, the Master Servicer shall withdraw from the Certificate
Account and transfer to the Paying Agent for deposit in the Distribution
Account a sum which, together with other amounts deposited in the Distribution
Account, will be sufficient to make the payments to Certificateholders in the
amounts and in the manner provided for in Section 6.01. The Master Servicer
shall cause the Paying Agent to perform each of the obligations of the Paying
Agent set forth herein and shall be liable to the Trustee, the
Certificateholders and the Surety for failure of the Paying Agent to perform
such obligations. The Master Servicer designates Bankers Trust Company of
California, N.A. as the initial Paying Agent. The Master Servicer shall notify
each Rating Agency, the Certificate Insurer and the Surety of any appointment
of an additional or successor Paying Agent.
The Master Servicer shall cause each Paying Agent other than itself
or the Trustee to execute and deliver to the Master Servicer an instrument in
which such Paying Agent shall agree with the Master Servicer that such Paying
Agent will hold all sums held by it for the payment to Certificateholders in
trust for the benefit of the Trustee on behalf of the Certificateholders (or
the Certificate Insurer and the Surety) entitled thereto until such sums shall
be paid to such Certificateholders (or the Certificate Insurer and the
Surety).
[End of Article IV]
<PAGE>
ARTICLE V
ADMINISTRATION AND SERVICING OF MORTGAGE LOANS
Section 5.01. Master Servicer to Service Mortgage Loans. (a) The
Master Servicer shall service and administer the Mortgage Loans in accordance
with its customary and prudent servicing procedures for residential mortgage
loans. The Master Servicer shall have full power and authority, acting alone
or through Sub-Servicers as provided in Section 5.02, to do any and all things
which it may deem necessary or desirable in connection with such servicing and
administration. Without limiting the generality of the foregoing, the Master
Servicer in its own name or in the name of a Sub-Servicer is hereby authorized
and empowered by the Trustee when the Master Servicer or the Sub-Servicer, as
the case may be, believes it appropriate in its best judgment, to execute and
deliver, on behalf of the Certificateholders, the Trustee, the Certificate
Insurer and the Surety or any of them, any and all instruments of satisfaction
or cancellation, or of partial or full release or discharge and all other
comparable instruments, with respect to the Mortgage Loans and with respect to
the Mortgaged Properties. At the written request of the Master Servicer, the
Trustee shall execute any limited powers of attorney and other documents
necessary or appropriate to enable the Master Servicer to service and
administer the Mortgage Loans and the Trustee shall not be liable for the
Master Servicer's or any Sub-Servicer's application thereof and shall be
indemnified by the Master Servicer for its use of such powers of attorney.
In connection with the servicing and administration of the Mortgage
Loans, the Master Servicer may at the request of a Mortgagor or at its own
initiative agree to modify the Mortgage Note or Mortgage relating to the
Mortgage Loan of such Mortgagor or, subject to the provisions of this
Agreement, waive compliance by the Mortgagor with any provision of such
Mortgage Note or Mortgage, provided, however, that any such modification or
waiver shall not (i) extend the scheduled maturity date of, modify the
Mortgage Rate payable under (except as required by law or as contemplated by
the Mortgage Note), or constitute a cancellation or discharge of the
outstanding principal balance of, such Mortgage Loan, (ii) be inconsistent
with the Master Servicer's then current practice respecting comparable
mortgage loans held in its own portfolio, or (iii) materially and adversely
affect the security afforded by the Mortgaged Property (any modification,
waiver or change of the nature described in Section 5.07 being deemed not to
violate clause (i) or clause (iii) above).
The foregoing clauses (i) and (iii) in the preceding paragraph are
subject to the proviso that the Master Servicer may agree to changes to the
terms of a Mortgage Note or Mortgage which would otherwise be violative
thereof if (i) the Master Servicer has determined that such changes are
necessary to avoid prepayment of the related Mortgage Loan or to accommodate
the request of a Mortgagor to extend the scheduled maturity date of the
related Mortgage Loan beyond the period of the original term to maturity and
such changes are consistent with prudent business practice as evidenced by a
certificate signed by a Servicing Officer to such effect, (ii) the Master
Servicer shall purchase the related Mortgage Loan for the Purchase Price on
the Determination Date immediately following the Due Period during which such
changes were made and deposit such Purchase Price in the Certificate Account
on or prior to such Determination Date and (iii) such changes and subsequent
purchase will not affect the status of the Trust Fund (exclusive of the
Mortgage 100(sm) Pledge Agreements, the Parent Power(R) Agreements, the
Pre-Funding Account (including the funds therein and Pre-Funding Earnings) and
the Carryover Reserve Fund (including the funds therein)) as two REMICs as
evidenced by an Opinion of Counsel (provided at the expense of the Master
Servicer) to such effect delivered to the Trustee; provided, however, that the
purchase of the related Mortgage Loan pursuant to the foregoing clause (ii)
shall occur on the second Business Day following the date on which such
changes were made if the short-term credit rating of the Merrill Lynch & Co.
Inc. (or its successor interest) is downgraded below A-1/P-1. Any such
repurchase shall be accomplished in the same manner and subject to the same
conditions set forth in Section 2.02. Upon making any such repurchase the
Servicer shall be entitled to receive an instrument of assignment or transfer
from the Trustee to the same extent as set forth in Section 2.02.
Nothing herein shall be deemed to constitute a joint venture or
partnership between the Master Servicer and the Trustee.
All Servicing Advances made by the Master Servicer in effecting the
timely payment of taxes and assessments on the properties subject to the
Mortgage Loans shall not, for the purpose of calculating monthly distributions
to Certificateholders, be added to the amount owing under the related Mortgage
Loans, notwithstanding that the terms of such Mortgage Loan so permit, and
such Servicing Advances shall be recoverable by the Master Servicer to the
extent permitted by Sections 5.09 and 5.23.
(b) Notwithstanding anything to the contrary in this Agreement
(including without limitation the termination of the servicing rights and/or
obligations of any Master Servicer under Article IX), MLCC shall service and
administer in accordance with this Agreement each Mortgage 100(sm) Pledge
Agreement, Parent Power(R) Guaranty and Securities Agreement for Securities
Account and Parent Power(R) Guaranty Agreement for Real Estate (collectively,
"Additional Collateral Agreements") at the direction of the Master Servicer if
MLCC is no longer the Master Servicer; provided, however, that only MLCC shall
service and administer the related securities accounts, lines of credit,
mortgages and guarantors with respect to Additional Collateral Agreements.
Section 5.02. Sub-Servicing Agreements Between Master Servicer and
Sub-Servicers; Enforcement of Sub-Servicer's Obligations. (a) The Master
Servicer may enter into Sub-Servicing Agreements with Sub-Servicers for the
servicing and administration of all or part of the Mortgage Loans if the
Master Servicer delivers to the Trustee an Officer's Certificate of the
Company, the Certificate Insurer and the Surety consenting to the appointment
of the Sub-Servicer and the entering into of the Sub-Servicing Agreement and a
written confirmation from each Rating Agency to the effect that entering into
such Sub-Servicing Agreement would not result in the reduction or withdrawal
of the then current ratings of the Class A Certificates. The Master Servicer
shall deliver a copy of any such Sub-Servicing Agreement to each Rating
Agency. References in this Agreement to actions taken or to be taken by the
Master Servicer in servicing the Mortgage Loans include actions taken or to be
taken by a Sub-Servicer on behalf of the Master Servicer. Each Sub-Servicing
Agreement will be based upon such terms and conditions as are not inconsistent
with this Agreement and as the Master Servicer and the Sub-Servicer have
agreed. The Master Servicer shall notify the Trustee, the Certificate Insurer
and the Surety in writing promptly upon the appointment of any Sub-Servicer.
For purposes of this Agreement, the receipt by the Sub-Servicer of any amount
with respect to a Mortgage Loan (other than amounts representing servicing
compensation or reimbursement for an advance) shall be treated as the receipt
by the Master Servicer of such amount.
(b) As part of its servicing activities hereunder, the Master
Servicer, for the benefit of the Trustee, the Certificateholders, the
Certificate Insurer and the Surety, shall enforce the obligations of each
Sub-Servicer under the related Sub-Servicing Agreement. Such enforcement,
including, without limitation, the legal prosecution of claims, termination of
Sub-Servicing Agreements as appropriate, and the pursuit of other remedies,
shall be in such form and carried out to such an extent and at such time as
the Master Servicer, in its good faith business judgment, would require were
it the owner of the related Mortgage Loans. The Master Servicer shall pay the
costs of such enforcement at its own expense but shall be reimbursed therefor
only (i) from a general recovery resulting from such enforcement only to the
extent, if any, that such recovery exceeds all amounts due in respect of the
related Mortgage Loans or (ii) from a specific recovery of costs, expenses or
attorneys' fees against the party against whom such enforcement is directed.
Section 5.03. Successor Sub-Servicers. The Master Servicer shall be
entitled to terminate any Sub-Servicing Agreement that may exist in accordance
with the terms and conditions of such Sub-Servicing Agreement and without any
limitation by virtue of this Agreement. Each Sub-Servicing Agreement shall
contain provisions that provide that a successor Master Servicer shall have
the option to terminate such agreement without cause or penalty upon its
succession as Master Servicer.
Section 5.04. Liability of the Master Servicer. Notwithstanding any
Sub-Servicing Agreement, any of the provisions of this Agreement relating to
agreements or arrangements between the Master Servicer or a Sub-Servicer or
reference to actions taken through a Sub-Servicer or otherwise, the Master
Servicer shall remain obligated and liable to the Trustee, the
Certificateholders, the Certificate Insurer and the Surety for the servicing
and administration of the Mortgage Loans in accordance with the provisions of
this Agreement without diminution of such obligation or liability by virtue of
such Sub-Servicing Agreements or arrangements or by virtue of indemnification
from the Sub-Servicer or the Mortgage Loan Seller and to the same extent and
under the same terms and conditions as if the Master Servicer alone were
servicing and administering the Mortgage Loans. The Master Servicer shall be
entitled to enter into any agreement with a Sub-Servicer for indemnification
of the Master Servicer and nothing contained in this Agreement shall be deemed
to limit or modify such indemnification.
Section 5.05. No Contractual Relationship Between Sub-Servicer and
Trustee, the Certificateholders, the Certificate Insurer or the Surety. Any
Sub-Servicing Agreement that may be entered into and other transactions or
services relating to the Mortgage Loans involving a Sub-Servicer in its
capacity as such and not as an originator shall be deemed to be between the
Sub-Servicer and the Master Servicer alone and the Trustee, the
Certificateholders, the Certificate Insurer and the Surety shall not be deemed
parties thereto and shall have no claims, rights, obligations, duties or
liabilities with respect to the Sub-Servicer.
Section 5.06. [Reserved]
Section 5.07. Collection of Mortgage Loan Payments. Continuously from
the date hereof until the principal and interest on all Mortgage Loans are
paid in full, the Master Servicer will proceed diligently to collect all
payments due under each of the Mortgage Loans when the same shall become due
and payable and shall, to the extent such procedures shall be consistent with
this Agreement, follow such collection procedures as it follows with respect
to comparable mortgage loans held in its own portfolio; provided, however,
that the Master Servicer may not waive any increase in the Mortgage Rate
permitted by the terms of any Mortgage Note (unless such increase is not
permitted by applicable law). Consistent with the foregoing, the Master
Servicer may in its discretion (i) waive any assumption fee, late payment
charge or other charge in connection with a Mortgage Loan and (ii) if the
Mortgagor is in default or about to be in default because of the Mortgagor's
financial condition, arrange a schedule, running for no more than 180 days
after the Due Date for the initial delinquent installment on the related
Mortgage Note, for the liquidation of delinquent items. The foregoing clause
(ii) is subject to the proviso that the Master Servicer may in its discretion
arrange with the Mortgagor a schedule for the payment of interest and
principal due and unpaid for a period that exceeds 180 days if such
arrangement is determined by the Master Servicer to be reasonable and
consistent with its then current practices respecting comparable mortgage
loans held in its own portfolio, including but not limited to its practices
regarding mortgage loans secured by mortgage properties located in federally
designated disaster areas. Any such arrangements shall not diminish or
otherwise affect the Master Servicer's obligation to make Advances pursuant to
Section 6.03.
At its sole discretion, the Master Servicer may, but shall not be
obligated to, purchase a Seriously Delinquent Mortgage Loan at its Purchase
Price. For purposes of this Agreement, any Seriously Delinquent Mortgage Loan
so purchased by the Master Servicer shall be deemed to be a Liquidated
Mortgage Loan that became liquidated at the time of such purchase, and the
Purchase Price paid by the Master Servicer shall be treated in the same manner
as Liquidation Proceeds. The Master Servicer shall deposit such purchase price
in the Certificate Account at the time of such purchase and shall be entitled
to receive an instrument of assignment or transfer from the Trustee in the
same manner as provided in Section 2.02.
Section 5.08. Establishment of Certificate Account; Deposits in
Certificate Account. With respect to all of the Mortgage Loans, the Master
Servicer shall establish and maintain a Certificate Account (the "Certificate
Account") which is an Eligible Account, titled "Merrill Lynch Credit
Corporation, as Master Servicer, in trust for Bankers Trust Company of
California, N.A., as Trustee, for the benefit of registered holders of MLCC
Mortgage Investors, Inc., Mortgage Loan Asset Backed Pass-Through
Certificates, Series 1999-A"; provided, however, that if the Certificate
Account is opened under a different name, the Master Servicer shall, within 90
days after the Closing Date, cause the Certificate Account to be re-titled
under the aforementioned name; and provided further, that if (x) the long-term
unsecured debt of Merrill Lynch & Co., Inc. is rated by Moody's, and is at any
time rated by Moody's below A3 or (y) if such debt is rated by Standard &
Poor's, and is at any time rated by Standard & Poor's below A-, the
Certificate Account shall thereafter be maintained by the Trustee and such
account shall at such time be titled "Bankers Trust Company of California,
N.A., as trustee for the benefit of the holders of MLCC Mortgage Investors,
Inc., Mortgage Loan Asset Backed Pass-Through Certificates, Series 1999-A".
Such Certificate Account shall be established with the Trustee or a commercial
bank, a mutual savings bank, or a savings and loan association. At such time
as either MLCC or the Trustee obtains actual knowledge of such change in the
rating of such debt, the party obtaining such knowledge shall promptly give
written notice of such event to the other party and to the Certificate Insurer
and the Surety; provided, however, that the foregoing notice requirement shall
be deemed to be satisfied by the notice provided pursuant to the fifth
paragraph in Section 2.01 and vice versa. The Master Servicer may invest, or
cause the institution maintaining the Certificate Account to invest, moneys in
the Certificate Account in Eligible Investments, which shall mature not later
than the Business Day next preceding the Distribution Date next following the
date of such investment and shall not be sold or disposed of prior to its
maturity. The proceeds of the sale or other disposition of all Eligible
Investments shall be deposited in the Certificate Account. All such Eligible
Investments shall be made in the name of the Trustee. All net income and gain
realized from any such investment shall be for the benefit of the Master
Servicer as additional servicing compensation and shall be subject to its
withdrawal or order from time to time. The Master Servicer shall be entitled
to retain any net interest paid on funds deposited in the Certificate Account
other than the interest on any funds required by applicable law to be paid to
a Mortgagor, and, to the extent required by applicable law, the Master
Servicer shall pay, without reimbursement from the Certificate Account,
interest on such funds to the Mortgagor notwithstanding that the Certificate
Account is non-interest bearing or that interest paid thereon is insufficient
for such purposes. The amount of any losses incurred in respect of any such
investments (to the extent not offset by income from other such investments)
shall be deposited in the Distribution Account by the Master Servicer out of
its own funds immediately as realized, without reimbursement from the
Certificate Account; provided, however, that if the Trustee becomes Master
Servicer, the Trustee shall not be required to deposit the amount of any loss
incurred prior to its becoming Master Servicer. The creation of the
Certificate Account shall be evidenced by a certification in the form of
Exhibit H. A copy of such certification shall be furnished to the Trustee.
The Master Servicer shall deposit or cause to be deposited in the
Certificate Account on a daily basis, no later than the later of the Closing
Date and one Business Day after the receipt thereof, and retain therein:
(i) All payments received which were due after the Cut-off Date
with respect to the Initial Mortgage Loans and the Subsequent Cut-off
Date with respect to the Subsequent Mortgage Loans on account of
principal on the Mortgage Loans, and all Principal Prepayments
collected after the Cut-off Date or Subsequent Cut-off Date, as
applicable;
(ii) All payments received on account of interest which are due
after the Cut-off Date with respect to the Initial Mortgage Loans and
the Subsequent Cut-off Date with respect to the Subsequent Mortgage
Loans net of the related Servicing Fee;
(iii) Net Liquidation Proceeds;
(iv) All Insurance Proceeds received by the Master Servicer
under any title, hazard or other insurance policy, including amounts
required to be deposited pursuant to Sections 5.16 and 5.20, other
than proceeds to be held in the Escrow Account or applied to the
restoration or repair of the Mortgaged Property or released to the
Mortgagor in accordance with the Master Servicer's normal servicing
procedures or otherwise applied or held as required by applicable
law;
(v) All awards or settlements in respect of condemnation
proceedings affecting any Mortgaged Property which are not released
to the Mortgagor in accordance with the Master Servicer's normal
servicing procedures;
(vi) All Repurchase Proceeds;
(vii) All amounts representing revenues under the insurance
provided pursuant to Section 5.19 to the extent of any losses borne
by any Certificateholder;
(viii) All revenues from any Mortgaged Property acquired by the
Master Servicer by foreclosure or deed in lieu of foreclosure net of
any Servicing Advances with respect to such Mortgaged Property; and
(ix) Any other amounts required to be deposited therein
pursuant to this Agreement.
The foregoing requirements for deposit in the Certificate Account shall be
exclusive, it being understood and agreed that, without limiting the
generality of the foregoing, payments in the nature of prepayment fees, late
payment charges and assumption fees need not be deposited by the Master
Servicer in the Certificate Account and may be retained by the Master Servicer
as additional servicing compensation. The Master Servicer shall maintain or
cause to be maintained accounting records on a loan-by-loan basis with respect
to the Certificate Account.
The Master Servicer shall give notice to the Trustee, the Company,
each Rating Agency, the Certificate Insurer and the Surety of any change in
the Certificate Account, prior to the use thereof.
Section 5.09. Permitted Withdrawals from the Certificate Account. The
Master Servicer may, from time to time, withdraw funds from the Certificate
Account for the following purposes:
(i) to make payments to Certificateholders, the Certificate
Insurer or the Surety in the amounts and in the manner provided for
in Section 6.01, or if applicable, to transfer moneys to the
Distribution Account maintained by the Paying Agent in accordance
with Sections 4.05 and 6.01;
(ii) to reimburse itself and the Trustee for Advances made
pursuant to Section 6.03 (including amounts to reimburse the related
Sub-Servicer for advances made pursuant to the applicable
Sub-Servicing Agreement), the Master Servicer's, the Sub-Servicer's
and the Trustee's right to receive reimbursement pursuant to this
subclause (ii) being limited to amounts received on particular
Mortgage Loans which represent Late Collections (net of the Servicing
Fee) with respect to those particular Mortgage Loans;
(iii) to reimburse itself for unpaid Servicing Fees and
unreimbursed Servicing Advances, to pay the related Sub-Servicer any
portion of unpaid Servicing Fees and unreimbursed Servicing Advances,
the Master Servicer's right to reimburse itself or make payments to
the Sub-Servicers pursuant to this subclause (iii) with respect to
any Mortgage Loan being limited to related Liquidation Proceeds,
Insurance Proceeds, and condemnation awards;
(iv) to reimburse itself (or the related Sub-Servicer) or the
Company for expenses incurred by and recoverable by or reimbursable
to it pursuant to Section 5.01, 5.16, 5.21 or 8.03 or to the Company
pursuant to Section 8.03 (provided that reimbursements pursuant to
Section 8.03 shall be made only out of funds that would otherwise be
distributable to the Class C and Class R Certificateholders);
(v) to reimburse itself (or the related Sub-Servicer) and the
Trustee for any Nonrecoverable Advances;
(vi) to pay to itself (or the related Sub-Servicer) any net
income earned on the investment of funds deposited in the Certificate
Account; and
(vii) to make payments to itself or others pursuant to any
provision of this Agreement, and to clear and terminate the
Certificate Account upon the termination of this Agreement.
Section 5.10. Establishment of Escrow Account; Deposits in Escrow
Account. With respect to those Mortgage Loans on which the Master Servicer or
any Sub-Servicer collects Escrow Payments, the Master Servicer shall, and
shall cause any Sub-Servicer to, segregate and hold all funds collected and
received pursuant to each such Mortgage Loan which constitute Escrow Payments
separate and apart from any of its own funds and general assets and shall
establish and maintain one or more Escrow Accounts. Such Escrow Account(s)
shall be established with a commercial bank, a mutual savings bank, or a
savings and loan association, the deposits of which are insured by the FDIC,
in a manner which shall provide maximum available insurance thereunder and
which may be drawn on by the Master Servicer. Subject to compliance with
applicable law, one Escrow Account may relate to multiple Mortgage Loans and
other mortgage loans serviced by the Master Servicer. The Master Servicer
shall give notice to the Trustee of the location of any Escrow Account, and of
any change thereof, prior to the use thereof.
The Master Servicer shall deposit, or cause to be deposited, in any
Escrow Account(s) on a daily basis, and retain therein, all Escrow Payments
collected on account of any Mortgage Loans, for the purpose of effecting
timely payment of any such items as required under the terms of this
Agreement. The Master Servicer shall make withdrawals therefrom only to effect
such payments as are required under this Agreement, and for such other
purposes as are set forth in Section 5.11. The Master Servicer or the
Sub-Servicer shall be entitled to retain any interest paid on funds deposited
in the Escrow Account(s) by the depository institution other than interest on
escrowed funds required by law to be paid to the Mortgagors and, to the extent
required by law, the Master Servicer shall pay interest on escrowed funds to
the Mortgagors notwithstanding that the Escrow Account(s) may be
non-interest-bearing or that interest paid thereon may be insufficient for
such purposes.
Section 5.11. Permitted Withdrawals from Escrow Account. Withdrawals
from any Escrow Account or Accounts may be made by the Master Servicer only
(i) to effect timely payments of ground rents, taxes, assessments, water
rates, or other items constituting Escrow Payments for the related Mortgage,
(ii) to reimburse the Master Servicer for any Servicing Advance made by the
Master Servicer, with respect to an Escrow Payment for a related Mortgage Loan
but only from amounts received on the related Mortgage Loan which represent
late payments or collections of Escrow Payments thereunder, (iii) to refund to
any Mortgagor any funds found to be in excess of the amounts required under
the terms of the related Mortgage Loan, (iv) for transfer to the Certificate
Account in accordance with the terms of the related Mortgage Loan, (v) for
application to restoration or repair of the property subject to the Mortgage,
(vi) to pay to the Master Servicer, or to the Mortgagor to the extent required
by law, any interest paid on the funds deposited in the Escrow Account, or
(vii) to clear and terminate the Escrow Account on the termination of this
Agreement.
Section 5.12. Payment of Taxes, Insurance and Other Charges. (a) With
respect to each Mortgage Loan, the Master Servicer shall maintain, or cause to
be maintained, accurate records reflecting the status of ground rents, taxes,
assessments, water rates and other charges which are or may become a lien upon
the Mortgaged Property and shall effect payment thereof to ensure the lien of
the Mortgage remains in full force and effect by applying deposits of the
Mortgagor in the Escrow Account, where such an account is maintained in
connection with a Mortgage Loan, to the extent permitted under the terms of
the Mortgage and applicable law. In the event the Master Servicer does not or
is prohibited by law from enforcing the escrow requirements under a Mortgage
and does not require a Mortgagor to make deposits into the Escrow Account, the
Master Servicer shall ensure that all ground rents, taxes, assessments, water
rates and any other charges which are or may become a lien upon the Mortgaged
Property are paid and the lien of the Mortgage remains in full force and
effect, and shall advance its own funds, if necessary, to effect payment of
the same, subject to Section 5.21.
(b) With respect to each Mortgage Loan, the Master Servicer shall
maintain or cause to be maintained accurate records reflecting the status of
Standard Hazard Policy premiums, and shall effect payment thereof by applying
deposits of the Mortgagor in the Escrow Account, where such an account is
maintained in connection with a Mortgage Loan, to the extent permitted under
the terms of the Mortgage and applicable law. In the event the Master Servicer
does not or is prohibited by law from enforcing the escrow requirements under
a Mortgage and does not require a Mortgagor to make deposits into the Escrow
Account, the Master Servicer shall ensure that at all times each Mortgaged
Property affected thereby is insured by hazard insurance to the extent
required under Section 5.16, and shall advance its own funds to effect payment
of the same, if necessary, in accordance with Section 5.16.
Section 5.13. Transfer of Accounts. The Master Servicer may transfer
the Certificate Account or Escrow Account to a different depository
institution from time to time. Such transfer shall be made by the Master
Servicer only upon obtaining the consent of the Trustee, the Certificate
Insurer and the Surety, which consent shall not be unreasonably withheld.
Section 5.14. Establishment of Pre-Funding Account; Permitted
Withdrawals. (a) No later than the Closing Date, the Trustee will establish
and thereafter maintain for the benefit of the Certificateholders and the
Certificate Insurer a segregated trust account (the "Pre-Funding Account")
which shall be an Eligible Account. On the Closing Date, the Company shall
remit or cause to remit to the Trustee from the proceeds of the sale of the
Class A Certificates, and the Trustee shall deposit, the Original Pre-Funded
Amount in the Pre-Funding Account. Any investment earnings on the Pre-Funding
Account shall be taxable to the Company. The Pre-Funding Account (including
the funds therein and Pre-Funding Earnings) shall not be an asset of the two
REMICs.
(b) On the Business Day preceding each Pre-Funding Distribution Date,
the Trustee shall withdraw from the Pre-Funding Account any Pre-Funding
Earnings on the amounts on deposit therein and deposit such Pre-Funding
Earnings into the Distribution Account. In addition, if such investments in
the Pre-Funding Account will not mature prior to the First Distribution Date,
the Master Servicer shall deposit into the Distribution Account an amount
equal to the Pre-Funding Earnings accrued (but not realized) from the Closing
Date, to but not including the First Distribution Date, which amount shall be
transferred for the benefit of the Master Servicer by the Trustee from future
Pre-Funding Earnings on the date of the maturity of the Eligible Investments
in the Pre-Funding Account. The Trustee shall invest moneys in the Pre-Funding
Account in Eligible Investments, which shall mature not later than the
Business Day next preceding the Distribution Date next following the date of
such investment, except that no investment needs to mature on or prior to the
First Distribution Date, and shall not be sold or disposed of prior to its
maturity. On each Subsequent Transfer Date, the Trustee shall withdraw from
the Pre-Funding Account an amount equal to 100% of the Principal Balance of
each Subsequent Mortgage Loan to be assigned to the Trustee on such Subsequent
Transfer Date and pay such amount to or at the direction of the Company. On
the Business Day immediately preceding the final Pre-Funding Period
Distribution Date, but in no event later than January 31, 2000, if any amounts
remain in the Pre-Funding Account after the withdrawals specified above, the
Trustee shall withdraw such amounts and deposit them into the Distribution
Account for distribution on account of principal to the Class A
Certificateholders on the final Pre-Funding Distribution Date and the
Pre-Funding Account shall be closed.
Section 5.15. Carryover Reserve Fund. (a) On the Closing Date, the
Master Servicer shall establish and the Trustee shall maintain a Carryover
Reserve Fund (the "Carryover Reserve Fund") initially entitled "MLCC Mortgage
Investors, Inc., as Class C Certificateholder, in trust for Bankers Trust
Company of California, N.A., as Trustee, for the benefit of registered holders
of MLCC Mortgage Investors, Inc., Mortgage Loan Asset Backed Pass-Through
Certificates, Series 1999-A"; provided, however, that if the Carryover Reserve
Fund is opened under a different name, the Master Servicer shall, within 90
days after the Closing Date, cause the Carryover Reserve Fund to be re-titled
under the aforementioned name. The Carryover Reserve Fund shall be an Eligible
Account, and funds on deposit therein shall be applied for the benefit of the
Class A and Class B Certificateholders. At such time, if any, that MLCC
Mortgage Investors, Inc. is no longer the Class C Certificateholder, the
Carryover Reserve Fund shall be retitled as "[New Class C Certificateholder],
as Class C Certificateholder, in trust for Bankers Trust Company of
California, N.A., as Trustee, for the benefit of registered holders of MLCC
Mortgage Investors, Inc., Mortgage Loan Asset Backed Pass-Through
Certificates, Series 1999-A".
(b) On each Distribution Date, as necessary, the Trustee shall
transfer from the Distribution Account to the Carryover Reserve Fund pursuant
to Section 6.01(a)(x) any Carryover Reserve Fund Deposit. On each Distribution
Date, as necessary, the Trustee shall also transfer from the Carryover Reserve
Fund to the Distribution Account the amount of any Basis Risk Carryover Amount
to be distributed on such date in accordance with Sections 6.01(a)(i) and/or
6.01(a)(v).
(c) On each Distribution Date, funds on deposit or deposited on such
date to the Carryover Reserve Fund shall be applied towards the distribution
of any Basis Risk Carryover Amount to the Class A and Class B
Certificateholders. The Basis Risk Carryover Amount for any Distribution Date
shall be allocated pro rata among the Class A and Class B Certificates based
on the amount of interest shortfall for each such Class of Certificates.
(d) The Trustee shall invest moneys in the Carryover Reserve Fund in
Eligible Investments, which shall mature not later than the Distribution Date
following the date of such investment and shall not be sold or disposed of
prior to its maturity. All such Eligible Investments shall be made in the name
of the Trustee. All net income and gain realized from any such investment
shall be paid to, and for the benefit of, the Holder of the Class C
Certificates on each Distribution Date. To the extent that the Class C
Certificateholder does not deposit into the Carryover Reserve Fund out of such
holder's own funds immediately as realized without reimbursement the amount of
any losses incurred in respect of any such investments (to the extent not
offset by income from other such investments), such losses may be offset from
the amounts that such holder would otherwise be entitled to receive under
Section 6.01(a). The Class C Certificates shall evidence ownership of the
Carryover Reserve Fund for federal tax purposes and the Holder of the Class C
Certificates shall direct the Trustee in writing as to the investment of
amounts therein.
(e) Upon termination of the Trust Fund, any amounts remaining in the
Carryover Reserve Fund shall be distributed to the Holder of the Class C
Certificates in the same manner as if distributed pursuant to Section 11.01
hereof.
Section 5.16. Maintenance of Standard Hazard Policies. (a) The Master
Servicer shall cause to be maintained for each Mortgage Loan a Standard Hazard
Policy with extended coverage as is customary in the area where the Mortgaged
Property is located in an amount equal to the amount that would be required by
Fannie Mae under its hazard insurance requirements for residential mortgage
loans. If the Mortgaged Property is in an area identified at the time of
origination in the Federal Register by the Federal Emergency Management Agency
as having special flood hazards (and such flood insurance has been made
available) the Master Servicer will cause to be maintained 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, (ii) the full insurable value or (iii) the
maximum amount of flood insurance which is available under the national flood
insurance program. The Master Servicer shall also maintain on property
acquired upon foreclosure, or by deed in lieu of foreclosure, of any Mortgage
Loan, fire and hazard insurance with extended coverage in an amount which is
not less than the lesser of (i) the outstanding principal balance of the
Mortgage Loan or (ii) the maximum insurable value of the improvements which
are a part of such property, liability insurance, and, to the extent
available, flood insurance in an amount as provided above. Any amounts
collected by the Master Servicer under any such policies (other than amounts
to be applied to the restoration or repair of the property subject to the
related Mortgage or property acquired in liquidation of the Mortgage Loan, or
released to the Mortgagor in accordance with the Master Servicer's normal
servicing procedures) shall be deposited, subject to applicable law, in the
Certificate Account. It is understood and agreed that no earthquake or other
additional insurance need be required by the Master Servicer of any Mortgagor
or maintained on property acquired in respect of a Mortgage Loan, 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 such Standard Hazard
Policies and other policies shall be endorsed with standard mortgagee clauses
with loss payable to the Master Servicer or its designee. Any such Standard
Hazard Policies or any other policies may be in the form of blanket policies;
provided, however, that in the event of any claim arising in connection with a
hazard loss the Master Servicer shall be obligated, in the case of blanket
insurance policies, to deposit in the Certificate Account in accordance with
Section 5.08(iv) any amount not payable under such blanket policy because of a
deductible clause therein that would otherwise have been payable under an
individual policy complying with the first sentence of this Section 5.16. The
Master Servicer shall not interfere with the Mortgagor's freedom of choice in
selecting either his insurance carrier or agent, provided, however, that the
Master Servicer shall not accept any such insurance policies from insurance
companies unless such companies are acceptable insurers with respect to the
insurance coverage set forth in this Section under the laws of, and are
licensed to do business in, the state wherein the property subject to the
policy is located.
(b) Any cost incurred by the Master Servicer in maintaining any of
the foregoing insurance shall not, for the purpose of calculating monthly
distributions to Certificateholders, be added to the amount owing under the
Mortgage Loan, notwithstanding that the terms of the Mortgage Loan so permit.
Such costs (other than the costs of maintaining a blanket Hazard Insurance
Policy not attributable to a specific Mortgaged Property) shall be recoverable
by the Master Servicer from the Mortgagor or out of Insurance Proceeds or
Liquidation Proceeds or to the extent permitted by Section 5.09.
Section 5.17. [Reserved]
Section 5.18. [Reserved]
Section 5.19. Fidelity Bond and Errors and Omissions Insurance. The
Master Servicer shall maintain, at its own expense, a blanket fidelity bond,
and errors and omissions insurance policy (or, in lieu thereof, a mortgage
interest insurance policy acceptable to Fannie Mae), with broad coverage with
responsible companies on all officers, employees or other Persons acting in
any capacity with regard to the Mortgage Loans to handle funds, money,
documents and papers relating to the Mortgage Loans. Any such fidelity bond
and errors and omissions insurance (or, in lieu thereof, a mortgage interest
insurance policy acceptable to Fannie Mae), shall protect and insure the
Master Servicer against losses, including forgery, theft, embezzlement, fraud,
errors and omissions and negligent acts of such Persons. No provision of this
Section 5.19 requiring such fidelity bond and errors and omissions insurance
(or, in lieu thereof, a mortgage interest insurance policy acceptable to
Fannie Mae) shall diminish or relieve the Master Servicer from its duties and
obligations set forth in this Agreement. The minimum coverage under any such
bond and insurance policy shall be in an amount that will permit the Master
Servicer to continue to be a Fannie Mae-qualified seller/servicer. Upon
request of the Trustee, the Certificate Insurer or the Surety, the Master
Servicer shall cause to be delivered to the Trustee, the Certificate Insurer
or the Surety a certified true copy of such fidelity bond and insurance
policy. Promptly upon receipt of any notice from the surety or the insurer
that such fidelity bond or insurance policy has been terminated or materially
modified, the Master Servicer shall notify the Trustee, the Certificate
Insurer, the Surety and the Rating Agencies of any such termination or
modification.
Section 5.20. Collections under Insurance Policies; Enforcement of
Due-on-Sale Clauses; Assumption Agreements. (a) In connection with its
activities as administrator and servicer of the Mortgage Loans, the Master
Servicer agrees to present, on behalf of itself, the Trustee, the
Certificateholders, the Certificate Insurer and the Surety, claims to the
insurer under any Standard Hazard Policies and, in this regard, to take such
reasonable action as shall be necessary to permit recovery under any insurance
policies. Pursuant to Section 5.08, the Master Servicer shall deposit
Insurance Proceeds in the Certificate Account. In those cases in which a
Mortgage Loan is serviced by a Sub-Servicer, the Sub-Servicer, on behalf of
itself, the Master Servicer, the Trustee, the Certificateholders, the
Certificate Insurer and the Surety, shall, pursuant to a Sub-Servicing
Agreement, be required to present claims to the insurer under any such
Standard Hazard Insurance Policy and deposit all collections thereunder
initially in the Certificate Account to the extent not required or permitted
to be deposited in the Escrow Account pursuant to Section 5.10.
(b) When any Mortgaged Property is conveyed by the Mortgagor, the
Master Servicer may, but is not obligated to, enforce any due-on-sale clause
contained in any Mortgage Note or Mortgage consistent with its then current
practices and without regard to the fact that such Mortgage Loan is in the
Trust Fund rather than the Master Servicer's portfolio. Subject to the
preceding sentence, the Master Servicer will exercise any such due-on-sale
clause only to the extent permitted by such Mortgage Note or Mortgage,
applicable law and governmental regulations and only to the extent that such
enforcement will not adversely affect or jeopardize coverage under any
insurance policy required by this Agreement. If the Master Servicer elects not
to exercise such due on sale clause in respect of a Mortgage Loan or if it is
prohibited from doing so by applicable law, the Master Servicer is authorized
to take or enter into an assumption or modification agreement from or with the
Person to whom such property has been or is about to be conveyed. Under an
assumption or modification agreement, the original mortgagor or obligor
remains liable for the payment of the Mortgage Loan unless released in writing
by the Master Servicer. In connection with such assumption or modification,
the Master Servicer shall follow such practice and procedures as shall be
normal and usual and as it applies to mortgage loans owned solely by it.
Notwithstanding the foregoing paragraph or any other provision of
this Agreement, the Master Servicer shall not be deemed to be in default,
breach or any other violation of its obligations hereunder by reason of and
conveyance by the Mortgagor of the Mortgaged Property or any assumption of a
Mortgage Loan by operation of law which the Master Servicer in good faith
determines it may be restricted by law from preventing, for any reason
whatsoever.
(c) Subject to the Master Servicer's discretion to enforce any
due-on-sale clause as set forth in Section 5.20(b), in any case in which a
Mortgaged Property is to be conveyed to a Person by a Mortgagor, and such
Person is to enter into an assumption agreement or modification agreement or
supplement to the Mortgage Note or Mortgage, the Master Servicer shall so
notify the Trustee and forward to the Custodian the original of each
assumption or substitution agreement, which shall be added by the Custodian 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 such assumption or
substitution agreement, the interest rate of the related Mortgage Note shall
not be changed, and the principal amount of the Mortgage Note shall not be
increased or decreased and the maturity of the Mortgage Note shall not be
accelerated or extended. Any fee collected by the Master Servicer for entering
into an assumption or substitution of liability agreement with respect to such
Mortgage Loan shall be retained by the Master Servicer as additional servicing
compensation.
Section 5.21. Income and Realization from Defaulted Mortgage Loans.
Subject to Section 5.07, the Master Servicer shall foreclose upon or otherwise
comparably convert the ownership of Mortgaged Properties securing such of the
Mortgage Loans as come into and continue in default and as to which no
satisfactory arrangements can be made for collection of delinquent payments
pursuant to Section 5.07, shall manage, conserve, protect and operate such
Mortgaged Properties for the purposes of their prompt disposition and sale,
and shall dispose of such Mortgaged Properties on such terms and conditions as
it deems in the best interests of the Certificateholders; provided that if the
Master Servicer has actual knowledge that a Mortgaged Property is affected by
hazardous waste, then the Master Servicer shall not cause the Trustee to
acquire title to such Mortgaged Property in a foreclosure or similar
proceeding unless so instructed by the Certificate Insurer and the Surety. For
purposes of the proviso in the preceding sentence, the Master Servicer shall
not be deemed to have actual knowledge that a Mortgaged Property is affected
by hazardous waste unless it shall have received written notice from a person
with professional experience with hazardous waste that such waste is present
on such property and such written notice has been made a part of the servicing
file with respect to the related Mortgage Loan. In addition, if an Additional
Collateral Mortgage Loan becomes a defaulted Mortgage Loan, the Master
Servicer (or if MLCC is no longer the Master Servicer, MLCC at the direction
of the Master Servicer) shall make all reasonable efforts to realize upon the
related Additional Collateral, and any proceeds from the realization of such
Additional Collateral, and not the Additional Collateral itself, shall be
included in Liquidation Proceeds and, to the extent of related Net Liquidation
Proceeds, deposited in the Certificate Account. Notwithstanding the foregoing,
any proceeds from the realization of Additional Collateral shall be included
in Liquidation Proceeds only when permitted by applicable state law and by the
terms of the related Mortgage 100(sm) Pledge Agreement or Parent Power(R)
Agreement. The Master Servicer shall sell such property within three years
from such foreclosure or conversion or such longer period as would not prevent
such Mortgaged Property from constituting "foreclosure property" within the
meaning of Section 860G(a)(8) of the Code. In connection with such activities,
the Master Servicer shall take all actions necessary to ensure that such
Mortgaged Property constitutes foreclosure property (within the meaning of
Section 860G(a)(8) of the Code) including, if necessary, the hiring of
independent contractors (within the meaning of Section 856(d)(3) of the Code)
to render any services with respect to the property. The Master Servicer also
shall follow such practices and procedures as it shall deem necessary or
advisable, as shall be normal and usual in its general mortgage servicing
activities, including its management of foreclosed properties for a temporary
period as contemplated herein. The foregoing is subject to the provision that
the Master Servicer shall not be required to expend its own funds in
connection with any management, foreclosure or towards the restoration of any
property unless it shall determine that such management, restoration or
foreclosure will increase the Liquidation Proceeds of the Mortgage Loan to the
Trust Fund after reimbursement to itself for such expenses (respecting which
it shall have priority for purposes of withdrawals from the Certificate
Account pursuant to Section 5.09). The income earned from the management of
such Mortgaged Properties, net of reimbursement to the Master Servicer for
expenses incurred (including any taxes) in connection with such management,
shall be applied to the payment of principal of and interest on the related
defaulted Mortgage Loans (with interest accruing and principal amortizing as
though such Mortgage Loans were still current) and all such income shall be
deemed, for all purposes in this Agreement, to be payments on account of
principal and interest on the related Mortgage Notes and shall be deposited
into the Certificate Account.
Section 5.22. Custodian and Trustee to Cooperate; Release of Mortgage
Files. (a) Upon becoming aware of the payment in full of any Mortgage Loan,
the Master Servicer shall promptly deliver to the Custodian (if the Custodian
holds the related Mortgage File) an Officer's Certificate (which shall include
a statement to the effect that all amounts received in connection with such
payment which are required to be deposited in the Certificate Account pursuant
to Section 5.08 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 Custodian, pursuant to the Custodial Agreement,
shall promptly release the related Mortgage File to the Master Servicer and
shall execute and deliver to the Master Servicer the deed of reconveyance or
release or satisfaction of Mortgage or other instruments releasing the lien of
the Mortgage, together with any other documents presented to it by the Master
Servicer for such purposes or to evidence the cancellation of indebtedness,
and the Trustee shall thereafter have no further responsibility with respect
to said Mortgage File. Upon any such payment in full, the Master Servicer is
authorized to procure from the trustee under the deed of trust which secured
the Mortgage Note, if any, a deed of full reconveyance covering the property
encumbered by such deed of trust, or, as the case may be, procure from the
Trustee an instrument of satisfaction or, if the Mortgagor so requests, an
assignment without recourse, which deed of reconveyance, instrument of
satisfaction or assignment shall be delivered by the Master Servicer to the
Person or Persons entitled thereto. No expenses incurred in connection with
any instrument of satisfaction or deed of reconveyance shall be chargeable to
the Certificate Account.
(b) From time to time as is appropriate for the servicing or
foreclosure of any Mortgage Loan, the Master Servicer shall deliver to the
Custodian a certificate of a Servicing Officer in the form of an Officer's
Certificate (a form of which is attached to the Custodial Agreement)
requesting that possession of all, or any document constituting part of, the
Mortgage File be released to the Master Servicer and certifying as to the
reason for such release and that such release will not invalidate any
insurance coverage provided in respect of the Mortgage Loan under any of the
insurance policies required by this Agreement. With such certificate, the
Master Servicer shall request that the Custodian release the Mortgage File,
and the Custodian, pursuant to the Custodial Agreement, shall deliver the
Mortgage File or any document therein to the Master Servicer. The Master
Servicer shall cause each Mortgage File or any document therein so released to
be returned to the Custodian when the need therefor by the Master Servicer no
longer exists, unless (i) the Mortgage Loan has been liquidated and the Net
Liquidation Proceeds relating to the Mortgage Loan have been deposited in the
Certificate Account or (ii) the Mortgage File or such document 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 Master Servicer maintains in its servicing records for
presentation to the Custodian upon request 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.
(c) Upon written request of the Master Servicer, the Trustee shall
execute and deliver to the Master Servicer any court pleadings, requests for
trustee's sale or other documents necessary to the foreclosure or trustee's
sale in respect of a Mortgaged Property or to 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 Master Servicer shall
deliver to the Trustee a certificate of a Servicing Officer requesting that
such a 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 any insurance coverage
under the insurance policies required under this Agreement or invalidate or
otherwise adversely affect the lien of the Mortgage, except for the
termination of such a lien upon completion of the foreclosure or trustee's
sale.
Section 5.23. Servicing and Other Compensation. The Master Servicer,
as compensation for its activities hereunder, shall be entitled to receive on
or prior to each Distribution Date the amounts provided for as the Servicing
Fee and as reimbursement for Nonrecoverable Advances, Servicing Advances and
reimbursement for Advances, all as specified by Section 5.09. The amount of
compensation or reimbursement provided for shall be accounted on an aggregate
basis.
Additional servicing compensation in the form of assumption fees,
prepayment fees, late payment charges or, to the extent not required to be
deposited in the Certificate Account pursuant to Section 5.08, 5.20 or 5.21 or
to the extent permitted to be withdrawn pursuant to Section 5.09, other
amounts shall be retained by the Master Servicer. The Master Servicer shall be
required to pay all expenses incurred by it in connection with its servicing
activities hereunder (including the fees and expenses of the Trustee) and
shall not be entitled to reimbursement therefor except as specifically
provided in Sections 5.09 and 5.21.
Section 5.24. File Review Rights of the Certificate Insurer and the
Surety. The Certificate Insurer or the Surety shall have the right to review
the files of the Trustee and the Master Servicer relating to the Certificates
upon reasonable notice and during ordinary business hours.
Section 5.25. Annual Statement as to Compliance. The Master Servicer
will deliver to the Company and the Trustee on or before March 31 of each
year, beginning with the first March 31 that occurs at least six months after
the Cut-off Date, an Officers' Certificate stating, as to each signer thereof,
that (i) a review of the activities of the Master Servicer during the
preceding calendar year and of performance under this Agreement has been made
under such officer's supervision, (ii) to the best of such officer's
knowledge, based on such review the Master Servicer has fulfilled all of its
obligations under this Agreement in all material respects throughout such
year, or, if there has been a default in the fulfillment of any such
obligation in any material respect, specifying each such default known to such
officer and the nature and status thereof and (iii) to the best of such
officer's knowledge, each Sub-Servicer has fulfilled its obligation under its
Sub-Servicing Agreement in all material respects, or if there has been a
material default in the fulfillment of such obligations in any material
respect, specifying such default known to such officers and the nature and
status thereof. Copies of such statement shall be provided to each Rating
Agency, the Certificate Insurer and the Surety. Copies of such statement shall
also be provided by the Master Servicer to any Certificateholder upon request.
If the Master Servicer shall fail to provide such copies and the Trustee is
aware that the Master Servicer has not so provided copies, the Trustee shall
provide such copies at the Master Servicer's expense if the Trustee has
received such statement.
Section 5.26. Annual Independent Public Accountants' Servicing
Report. On or before March 31 of each year, beginning with the first March 31
that occurs at least six months after the Cut-off Date, the Master Servicer at
its expense shall cause a nationally recognized firm of independent public
accountants which is a member of the American Institute of Certified Public
Accountants to furnish a report to the Company and the Trustee to the effect
that all Mortgage Loans serviced by the Master Servicer under this Agreement
were included in the total population that was subject to selection for
testing in such firm's examination of certain documents and records and that
such examination, which has been conducted substantially in compliance with
the Uniform Single Attestation Program for Mortgage Bankers (or such other
audit or review program applicable to the Master Servicer), has disclosed no
items of material noncompliance with the provisions of the Uniform Single
Attestation Program for Mortgage Bankers (or such other program), except for
such items of noncompliance as shall be set forth in such report. Copies of
such report shall be provided to the Rating Agencies, the Certificate Insurer,
the Surety, and, upon request, to the Certificateholders, by the Master
Servicer, or by the Trustee at the Master Servicer's expense if the Trustee
has received such report and the Master Servicer shall fail to provide such
copies and the Trustee is aware that the Master Servicer has not so provided
copies.
Section 5.27. Access to Certain Documentation; Rights of the Company
in Respect of the Master Servicer. The Master Servicer shall provide access to
the Certificate Insurer, the Surety, the Trustee, Certificateholders which are
savings and loan associations, banks or insurance companies, the Office of
Thrift Supervision, the FDIC and the Supervisory Agents and examiners of the
Office of Thrift Supervision and the FDIC or examiners of any other federal or
state banking or insurance regulatory authority to the documentation regarding
the Mortgage Loans if so required by applicable regulations of the Office of
Thrift Supervision or other regulatory authority, such access to be afforded
subject to reimbursement for expenses but only upon reasonable request and
during normal business hours at the offices of the Master Servicer designated
by it. The Company may, but is not obligated to, enforce the obligations of
the Master Servicer under this Agreement and may, but is not obligated to,
appoint and cause a designee to perform, any defaulted obligations of the
Master Servicer hereunder or exercise the rights of the Master Servicer
hereunder; provided that the Master Servicer shall not be relieved of any of
its obligations hereunder by virtue of the appointment of a designee by the
Company or its designee. The Company shall not assume any responsibility or
liability for any action or failure to take any action by the Master Servicer
and is not obligated to supervise the performance of the Master Servicer under
this Agreement or otherwise.
Section 5.28. REMIC-Related Covenants. For as long as the Trust Fund
shall exist, the Master Servicer shall act in accordance herewith to assure
continued treatment of the Trust Fund (exclusive of the Mortgage 100(sm) Pledge
Agreements, the Parent Power(R) Agreements, the Pre-Funding Account (including
the funds therein and Pre-Funding Earnings) and the Carryover Reserve Fund
(including the funds therein)) as two REMICs. In particular:
(a) The Master Servicer shall not create, or permit the
creation of, any "interests" in the Trust Fund (exclusive of the
Mortgage 100(sm) Pledge Agreements, the Parent Power(R) Agreements, the
Pre-Funding Account (including the funds therein and Pre-Funding
Earnings) and the Carryover Reserve Fund (including the funds
therein)) within the meaning of Section 860G of the Code other than
the interests represented by the Certificates;
(b) As of all times as may be required by the Code, the Master
Servicer will ensure that substantially all of the assets of the
Trust Fund (exclusive of the Mortgage 100(sm) Pledge Agreements, the
Parent Power(R) Agreements, the Pre-Funding Account (including the
funds therein and Pre-Funding Earnings) and the Carryover Reserve
Fund (including the funds therein)) will consist of "qualified
mortgages" as defined in Section 860G(a)(3) of the Code and
"permitted investments" as defined in Section 860G(a)(5) of the Code.
The Master Servicer shall maintain records that are sufficient to
indicate the Trust Fund's compliance with applicable requirements of
the Code (or applicable Treasury Regulations) relating to the assets
(exclusive of the Mortgage 100(sm) Pledge Agreements, the Parent
Power(R)Agreements, the Pre-Funding Account (including the funds
therein and Pre-Funding Earnings) and the Carryover Reserve Fund
(including the funds therein)) held by the Trust Fund. Further, the
Master Servicer shall not permit and the Trustee shall not accept the
transfer or substitution of any Mortgage Loan two years or more after
the Closing Date unless the Master Servicer and the Trustee have
received an Opinion of Counsel, which shall be an expense of the
Master Servicer, that such transfer or substitution would not
adversely affect the REMIC status of the Trust Fund (exclusive of the
Mortgage 100(sm) Pledge Agreements, the Parent Power(R) Agreements, the
Pre-Funding Account (including the funds therein and Pre-Funding
Earnings) and the Carryover Reserve Fund (including the funds
therein)) or would not otherwise be prohibited by this Agreement;
(c) The Master Servicer shall ensure that the Trust Fund does
not receive a fee or other compensation for services and that the
Trust Fund does not receive any income from assets other than
"qualified mortgages" within the meaning of Section 860G(a)(3) of the
Code or "permitted investments" within the meaning of Section
860G(a)(5) of the Code, and shall take whatever action it deems
necessary to avoid any material tax imposed by the Code on the Trust
Fund;
(d) The Trustee shall not sell or permit the sale of all or any
portion of the Mortgage Loans or of any Eligible Investment unless
such sale is as a result of a repurchase of the Mortgage Loans by the
Master Servicer or the Mortgage Loan Seller pursuant to the Agreement
or the Trustee has received an Opinion of Counsel to the effect that
such sale (i) is in accordance with a qualified liquidation as
defined in Section 860F(a)(4) of the Code and as described in Section
11.01 hereof, or (ii) would not be treated as a prohibited
transaction within the meaning of Section 860F(a)(2) of the Code,
which prohibited transaction results in the realization of a material
amount of gain or loss for federal income tax purposes; and
(a) Notwithstanding anything to the contrary in this Agreement,
the Master Servicer and the Trustee, at the direction and at the
expense of the Master Servicer, shall take any other action or may
fail to take any action otherwise required where the Master Servicer
deems such action or inaction reasonably necessary to preserve or
ensure the REMIC status of the Trust Fund (exclusive of the Mortgage
100(sm) Pledge Agreements, the Parent Power(R)Agreements, the
Pre-Funding Account (including the funds therein and Pre-Funding
Earnings) and the Carryover Reserve Fund (including the funds
therein)) or to avoid the imposition of any material tax liability on
the Trust Fund other than the tax imposed pursuant to Section 24872
of the California Revenue and Taxation Code.
Section 5.29. Prohibited Transactions and Other Taxes. In the event
that any tax is imposed on the Trust Fund (including "prohibited transactions"
of the Trust Fund as defined in Section 860F of the Code), such tax shall be
charged first against amounts distributable to the Class C and Class R
Certificateholders and then against amounts otherwise distributable to the
Class B Certificateholders on a pro rata basis. The Master Servicer is hereby
authorized to direct the Paying Agent to retain and, upon such direction, the
Paying Agent is hereby authorized to retain from amounts otherwise
distributable to the Class R Certificateholder, the Class C Certificateholders
and the Class B Certificateholders, as appropriate, sufficient funds to pay or
provide for the payments of, and to actually pay, such tax as is legally owed
by the Trust Fund (but such authorization shall not prevent the Trustee or the
Master Servicer from contesting any such tax in appropriate proceedings, if
either of them elects to so contest such tax or proceeding, and withholding
payment of such tax, if permitted by law, pending the outcome of such
proceedings).
[End of Article V]
<PAGE>
ARTICLE VI
PAYMENTS TO THE CERTIFICATEHOLDERS
Section 6.01. Distributions. (a) On each Distribution Date, the
Paying Agent shall distribute funds from the Distribution Account, to the
extent deposited therein, in the following amounts and in the following order
of priority (subject to the requirement that Insured Payments shall only be
distributed to the Class A Certificateholders):
(i) to the Class A Certificateholders, the Class A Interest
Formula Distribution Amount; provided, however, any Basis Risk
Carryover Amount shall be distributable only from amounts withdrawn
from the Carryover Reserve Fund pursuant to Section 5.15 and
deposited in the Distribution Account in respect of such Distribution
Date;
(ii) to the Class A Certificateholders, on account of
principal, the Class A Formula Principal Distribution Amount until
the Class A Principal Balance is reduced to zero;
(iii) to the Certificate Insurer, the Premium Amount for the
Certificate Insurance Policy;
(iv) to the Certificate Insurer, any Reimbursement Amount;
(v) to the Class B Certificateholders, the Class B Interest
Formula Distribution Amount; provided, however, any Basis Risk
Carryover Amount shall be distributable only from amounts withdrawn
from the Carryover Reserve Fund pursuant to Section 5.15 and
deposited in the Distribution Account in respect of such Distribution
Date;
(vi) to the Class A Certificateholders, on account of
principal, the Unrecovered Principal Amounts, if any, for such
Distribution Date and all prior Distribution Dates that have not
previously been distributed pursuant to this clause until the Class A
Principal Balance is reduced to zero;
(vii) to the Class B Certificateholders, interest for the
related Accrual Period at the Class B Pass-Through Rate (to the
extent legally permitted) on any Class B Unpaid Interest Shortfall
for such Distribution Date ;
(viii) to the Class B Certificateholders, on account of
principal, the Class B Formula Principal Distribution Amount until
the Class B Principal Balance is reduced to zero;
(ix) to the Class B Certificateholders, the Class B Loss
Amounts not previously distributed to them pursuant to this clause,
together with the Class B Loss Amount Interest Requirement;
(x) to the Carryover Reserve Fund, any Carryover Reserve Fund
Deposit;
(xi) to the Class C Certificateholders, the Class C Interest
Formula Distribution Amount; and
(xii) to the Class R Certificateholder any remaining balance;
provided, however, that until the Class A Principal Balance is reduced to
zero, distributions on account of principal otherwise allocable to the Class B
Certificateholders in accordance with the above priorities will instead be
made to the Class A Certificateholders (A) to the extent, if any, that such
distribution would, if made to the Class B Certificateholders, reduce the
Class B Principal Balance to less than 1.00% of the Original Pool Principal
Balance or (B) if the Class B Principal Balance is less than 1.00% of the
Original Pool Principal Balance; and provided further that the aggregate
amounts distributed on account of principal to the Class A and Class B
Certificateholders (whether out of the Available Distribution Amount, the
Certificate Insurance Policy or the Certificate Guaranty Surety Bond) shall
not exceed the Original Class A and Class B Principal Balance, respectively.
On the Business Day immediately preceding the final Pre-Funding
Period Distribution Date, but in no event later than January 31, 2000, if any
amounts remain in the Pre-Funding Account after the withdrawals specified in
Section 5.14(b), the Trustee shall withdraw such amounts and deposit them into
the Distribution Account for distribution on account of principal to the Class
A Certificateholders on the final Pre-Funding Distribution Date and the
Pre-Funding Account shall be closed.
As provided in the definitions of "Class A Interest Formula
Distribution Amount" and "Class B Interest Formula Distribution Amount", the
interest entitlement above for the Class A and Class B Certificates with
respect to each Distribution Date shall be reduced by the amount of Net
Interest Shortfall for such Distribution Date allocable to each such Class.
Net Interest Shortfall on any Distribution Date will be allocated pro rata
among the Class A and Class B Certificates based on the amount of interest
each such Class of Certificates would otherwise be entitled to receive on such
Distribution Date.
On the Business Day preceding the First Distribution Date, the
Company will cause to be deposited into the Distribution Account an amount
equal to interest accrued for 28 days on the Pre-Funded Amount at the initial
Class A Pass-Through Rate.
(b) The Trustee shall calculate LIBOR for each Distribution Date. The
Trustee shall make all necessary calculations and the Master Servicer shall
provide the Trustee and the Paying Agent with the information necessary to
make the above distribution to each Class of Certificateholders by the fifth
Business Day prior to each Distribution Date. The Master Servicer agrees to
provide such information in a format mutually acceptable to the Master
Servicer, the Trustee and the Paying Agent. Neither the Trustee nor the Paying
Agent shall be responsible for recomputing, recalculating or verifying
information provided to it by the Master Servicer. All distributions made to
Certificateholders of any Class on such Distribution Date will be made to the
Certificateholders of the respective Class of record on the next preceding
Record Date, except that on the final distribution, distributions shall be
made as provided in the form of Certificate. All distributions made to
Certificateholders shall be based on the Percentage Interest represented by
their respective Certificates, and shall be made either by wire transfer in
immediately available funds to the account of such Holder at a bank or other
financial or depository institution having appropriate facilities therefor, if
such Holder has so notified the Paying Agent in writing at least five Business
Days prior to the Record Date for the relevant Distribution Date and such
Holder's Certificates of such Class in the aggregate evidence an original
denomination of not less than $5,000,000 or, if not, by check mailed to the
address of the Person entitled thereto as it appears on the Certificate
Register, except that the final distribution in retirement of the Certificates
will be made only upon presentation and surrender of the Certificates at the
Corporate Trust Office or such other agency of the Trustee specified in the
final distribution notice to Certificateholders. If on any Determination Date,
the Master Servicer determines that there are no Mortgage Loans outstanding
and no other funds or assets in the Trust Fund other than the funds in the
Certificate Account or the Distribution Account, the Master Servicer shall
direct the Trustee promptly to send the final distribution notice to each
Certificateholder specifying the manner in which the final distribution will
be made. Except as otherwise provided in Section 11.01, whenever the Master
Servicer expects that a final distribution with respect to any Class of
Certificates will be made on the next Distribution Date and has so notified
the Trustee in writing on or prior to the related Determination Date, the
Trustee shall, no later than three (3) days after the related Determination
Date, mail to each Holder on such date of such Class of Certificates a notice
to the effect that: (i) the Master Servicer expects that the final
distribution with respect to such Class of Certificates will be made on such
Distribution Date but only upon presentation and surrender of such
Certificates at the office of the Trustee or as otherwise specified therein,
and (ii) no interest shall accrue on such Certificates from and after the end
of the related Accrual Period. In the event that Certificateholders do not
surrender their Certificates for final cancellation, the Trustee shall follow
procedures comparable to the arrangements set forth in the final paragraph of
Section 11.01.
(c) No later than 12:00 noon, New York City time, on the Business Day
preceding each Distribution Date, the Master Servicer shall transfer from the
Certificate Account to the Distribution Account a sum, which, together with
any Advances deposited in the Distribution Account as of the related Advance
Deposit Date pursuant to Section 6.03, will equal the Available Distribution
Amount for such Distribution Date to enable the Paying Agent to make the
distributions provided for in this Section 6.01. The Distribution Account
shall be established and maintained by and with the Paying Agent, and shall be
an Eligible Account titled "Bankers Trust Company of California, N.A., as
Paying Agent and Agent for the benefit of Bankers Trust Company of California,
N.A., as Trustee on behalf of the holders of MLCC Mortgage Investors, Inc.
Mortgage Loan Asset Backed Pass-Through Certificates, Series 1999-A" and the
Paying Agent shall deliver to the Trustee, the Certificate Insurer, the Surety
and the Master Servicer a "Distribution Account Certification" substantially
in the form of Exhibit J attached hereto. Moneys in the Distribution Account
shall not be invested.
Section 6.02. Statements to the Certificateholders. No later than
each Distribution Date, the Paying Agent shall mail to each holder of the
related Class of Certificates, each Rating Agency, the Certificate Insurer and
the Surety a statement setting forth the following information:
(i) with respect to each Class of Certificates, the amount of
such distribution to Holders of such Class allocable to principal.
Such statement shall separately identify, in the aggregate and not on
a Class by Class basis, the aggregate amount of any Principal
Prepayments, Net Liquidation Proceeds and Repurchase Proceeds
included in the distribution to all Classes;
(ii) with respect to each Class of Certificates, the amount of
such distribution to Holders of such Class allocable to interest,
identifying those cases in which the applicable Pass-Through Rate was
based on the Alternate Certificate Rate;
(iii) the amounts (stated separately) of any Class A Interest
Shortfall and Class B Interest Shortfall for such Distribution Date
and the amounts (stated separately) of Class A Unpaid Interest
Shortfall and Class B Unpaid Interest Shortfall;
(iv) the amount, if any, by which the sum of the Formula
Principal Distribution Amount and the Unrecovered Principal Amounts
for such Distribution Date exceeds the amount distributed on account
of principal to the related Certificateholders on such Distribution
Date;
(v) the amount of any Advances by the Master Servicer and by
the Trustee pursuant to Section 6.03 and the amount of delinquencies
of Mortgage Loans during the related Due Period;
(vi) the amount to be paid to the Certificate Insurer pursuant
to Section 6.01(a) (the information required by this clause (vi)
shall not be included in the statement to Certificateholders);
(vii) the Pool Principal Balance, after giving effect to the
Formula Principal Distribution Amount and the Unrecovered Principal
Amounts for such Distribution Date;
(viii) the related amount of the Servicing Fees retained or
withdrawn from the Certificate Account by the Master Servicer and the
amount of additional servicing compensation received by the Master
Servicer attributable to penalties, fees and other items;
(ix) the amount of Servicing Advances paid by the Master
Servicer and any Sub-Servicer;
(x) the number and aggregate principal amounts of Mortgage
Loans (A) delinquent (1) one Monthly Payment and (2) two Monthly
Payments, (3) three or more Monthly Payments, (B) in foreclosure and
(C) that constitute real estate owned that was acquired through
foreclosure or grant of a deed in lieu of foreclosure;
(xi) the book value (within the meaning of 12 C.F.R. ss. 571.13
or comparable provision) of any real estate acquired through
foreclosure or grant of a deed in lieu of foreclosure;
(xii) the Aggregate Net Principal Liquidation Losses for
Mortgage Loans that became Liquidated Mortgage Loans during the
related Principal Prepayment Period;
(xiii) all Advances recovered during the related Principal
Prepayment Period (but only to the extent such information is
aggregated and reported by the Master Servicer to the Paying Agent);
(xiv) the Distribution Account Shortfall, if any, the
Preference Amount, if any, and the Required Surety Payment, if any,
for such Distribution Date;
(xv) if such Distribution Date is a Pre-Funding Distribution
Date, the amount transferred to the Distribution Account from the
Pre-Funding Account;
(xvi) the aggregate Principal Balance of the Additional
Collateral Mortgage Loans;
(xvii) the Class A Principal Balance and the Class B Principal
Balance after giving effect to the distribution on such Distribution
Date; and
(xviii) the Class B Loss Amount for such Distribution Date.
The Paying Agent's and Trustee's responsibility for distributing the
above information to the Certificateholders is limited to the availability,
timeliness and accuracy of the information received from the Master Servicer.
Upon reasonable advance notice in writing, if required by federal
regulation, the Master Servicer will provide to each Certificateholder which
is a savings and loan association, bank or insurance company certain reports
and access to information and documentation regarding the Mortgage Loans
sufficient to permit such Certificateholder to comply with applicable
regulations of the Office of Thrift Supervision or other regulatory
authorities with respect to investment in the Certificates; provided, that the
Master Servicer shall be entitled to be reimbursed by each such
Certificateholder for the Master Servicer's actual expenses incurred in
providing such reports and access.
Section 6.03. Advances by the Master Servicer. (a) If, on any
Determination Date, the Master Servicer determines that any Monthly Payments
due on the immediately preceding Due Date have not been received or determines
that there will be a Distribution Account Shortfall for the related
Distribution Date, the Master Servicer shall, to the extent it determines in
good faith that such amounts or shortfall will be recoverable from Late
Collections, Liquidation Proceeds or otherwise, make an advance on or before
the related Advance Deposit Date in an amount equal to such delinquent Monthly
Payments or shortfall, after adjustment of any delinquent interest payment for
the Servicing Fee. For purposes of this Section 6.03, the delinquent Monthly
Payments referred to in the preceding sentence shall be deemed to include an
amount equal to the Monthly Payment that would have been due on the Mortgage
Loans which have been foreclosed or otherwise terminated and, in connection
therewith, the Master Servicer or the Trust Fund acquired and continues to own
the Mortgaged Properties on behalf of the Certificateholders. If the Master
Servicer makes an Advance, it shall on or prior to such Advance Deposit Date
deposit in the Distribution Account an amount equal to the Advance, if any.
Any such Advance shall be included with the distribution to the
Certificateholders on the related Distribution Date. The Master Servicer shall
be entitled to be reimbursed from funds in the Certificate Account for all
Advances and Nonrecoverable Advances as provided in Section 5.09.
The Master Servicer may make an Advance by: (i) depositing its own
funds in the Certificate Account, (ii) applying funds that are not part of the
Available Distribution Amount in respect of which the Advance is being made or
(iii) effecting a combination of clauses (i) and (ii). Any portion of the
funds so used pursuant to clause (ii) shall be replaced by the Master Servicer
by deposit in the Certificate Account on or before 12:00 noon New York City
time on the Business Day preceding any future Distribution Date to the extent
that funds that are available in the Certificate Account on such date shall be
less than the Available Distribution Amount for such Distribution Date.
(b) If the Master Servicer determines not to make an Advance under
the provisions of this Section, it shall on the related Advance Deposit Date
furnish to the Trustee, the Certificate Insurer, the Surety and each Rating
Agency written notice of such determination. In the event that the Master
Servicer fails to make an Advance required to be made pursuant to Section
6.03(a) and such failure continues unremedied on the close of business on the
Business Day prior to the related Distribution Date, the Trustee shall, on or
before the related Distribution Date, deposit in the Distribution Account an
amount equal to the excess of (i) Advances required to be made by the Master
Servicer under Section 6.03(a) over (ii) the amount of Advances made by the
Master Servicer with respect to such Distribution Date; provided that the
Trustee shall not be required to make such Advances if prohibited by law or
regulation, or if the Master Servicer determines that such Advance would be a
Nonrecoverable Advance. In the event the Trustee and the Paying Agent are not
the same Person, the Paying Agent shall promptly notify the Trustee of all
amounts transferred by the Master Servicer from the Certificate Account to the
Distribution Account. Until such time as the Master Servicer receives a notice
of termination pursuant to Section 9.01, the Trustee shall be entitled to be
reimbursed directly from the Master Servicer within five (5) Business Days for
any Advance and Nonrecoverable Advances make by the Trustee pursuant to this
Section 6.03(b). After such time as the Master Servicer receives a notice of
termination pursuant to Section 9.01 and the Trustee, as successor to the
Master Servicer pursuant to Section 8.05, has made any Advances and
Nonrecoverable Advances pursuant to this Section 6.03(b), the Trustee, in its
capacity as successor Master Servicer, shall be entitled to be reimbursed for
such Advances and Nonrecoverable Advances from the Certificate Account in the
manner provided by Section 5.09.
(c) (i) In the event that any Mortgage Loan is the subject of a
Prepayment Interest Shortfall, the Master Servicer shall, to the extent of the
Servicing Fee for such Distribution Date, deposit into the Certificate
Account, as a reduction of the Servicing Fee (but not in excess thereof) for
such Distribution Date, no later than the close of business on the second
Business Day prior to the related Distribution Date, an amount equal to the
Prepayment Interest Shortfall; and in the case of such deposit, the Master
Servicer shall not be entitled to any recovery or reimbursement from the
Company, the Trustee or the Certificateholders. Such deposited amount shall be
part of the Available Distribution Amount for such Distribution Date.
The balance, if any, of the Servicing Fee in respect of a month
(after giving effect to the preceding paragraph) shall be deposited into the
Certificate Account (as a reduction in the Servicing Fee) to the extent of the
amount, if any, by which (i) the interest accrued on the Class A and Class B
Certificates (calculated on the basis that the sum of the Class A Principal
Balance and the Class B Principal Balance shall not be greater than the Pool
Principal Balance at the end of such month) at the weighted average of the
applicable Class A Pass-Through Rate and the Class B Pass-Through Rate for the
related Accrual Period exceeds (ii) the interest due on the Mortgage Loans on
the Due Date during such Accrual Period (calculated on the assumption that
there were no prepayments of the Mortgage Loans during the month preceding
such Due Date) at the then respective Net Mortgage Rates and during the
Pre-Funding Period, one month's interest on the amount in the Pre-Funding
Account at the weighted average Net Mortgage Rate for the Mortgage Loans. Such
deposited amount shall be part of the Available Distribution Amount for the
Distribution Date following such month. The preceding sentence is intended to
apply to the situation where, if the Class A and Class B Pass-Through Rates
for an Accrual Period are equal to the related Alternate Certificate Rate, the
amount in clause (i) could be greater than the amount in clause (ii) because
interest will accrue on the Mortgage Loans on the basis of a year consisting
of twelve 30-day months and interest on the Class A and Class B Certificates
will accrue on the basis of the actual number of days in the Accrual Period
(which could be more than 30) divided by 360.
Section 6.04. The Certificate Insurance Policy. (a) On the third
Business Day prior to each Distribution Date, the Trustee shall determine
whether there will be a Distribution Account Shortfall for the related
Distribution Date. In the event that the Trustee determines that there will be
a Distribution Account Shortfall for the related Distribution Date, the
Trustee shall complete the notice in the form of Exhibit A to the Certificate
Insurance Policy. The Trustee shall submit such notice to the Certificate
Insurer no later than 12:00 noon New York City time on the Business Day
preceding such Distribution Date as a claim for an Insured Amount in an amount
equal to the Distribution Account Shortfall (net of any Basis Risk Carryover
Amount and Net Interest Shortfall allocable to the Class A Certificateholders
and included in the calculation of Distribution Account Shortfall).
(b) Upon receipt of Insured Payments from the Certificate Insurer on
behalf of Class A Certificateholders, the Trustee shall deposit such Insured
Payments in the Distribution Account and shall distribute such Insured
Payments, or the proceeds thereof, to the Class A Certificateholders in
accordance with Sections 6.01(a).
(c) The Trustee shall (i) receive as attorney-in-fact of each Holder
of any Class A Certificates any Insured Payment from the Certificate Insurer
and (ii) disburse the same to the Holders of such Certificates as set forth in
Section 6.01(b). Insured Payments disbursed by the Trustee from proceeds of a
Certificate Insurance Policy shall be considered payment by the Certificate
Insurer and not by the Trust Fund with respect to such Certificates, and the
Certificate Insurer shall be entitled to receive the related Reimbursement
Amount pursuant to Section 6.01(a)(iv). The Trustee hereby agrees on behalf of
each Class A Certificateholder and the Trust Fund 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 Holders of such Certificates, the Certificate
Insurer will be entitled to receive the related Reimbursement Amount pursuant
to Section 6.01(a)(iv).
(d) Subject only to the priority of payment provisions of this
Agreement, each of the Company and the Trustee acknowledges that, to the
extent of any payment made by the Certificate Insurer pursuant to the
Certificate Insurance Policy, the Certificate Insurer is to be fully
subrogated to the extent of such payment and any additional interest due on
any late payment, to the rights of the Holders of the Class A Certificates to
any moneys paid or payable in respect of the Class A Certificates under this
Agreement or otherwise. Each of the Company and the Trustee agrees to such
subrogation and, further, agrees to execute such instruments and to take such
actions as, in the sole judgment of the Certificate Insurer are necessary to
evidence such subrogation and, subject to the priority of payment provision of
this Agreement, to perfect the rights of the Certificate Insurer to receive
any moneys paid or payable in respect of the Class A Certificates under this
Agreement or otherwise.
Section 6.05. The Certificate Guaranty Surety Bond. (a) On the 11th
Business Day prior to each Distribution Date, the Master Servicer shall notify
the Trustee of the Required Surety Payment, if any, due in respect of any
Additional Collateral Mortgage Loan that became a Liquidated Mortgage Loan at
least ten Business Days (or such shorter period as the Master Servicer shall
determine in its discretion) prior to such 11th Business Day and that has not
been previously reported to the Trustee pursuant to this sentence. Upon its
receipt of such notice, the Trustee shall complete the notice in the form of
Attachment 1 to the Certificate Guaranty Surety Bond. The Trustee shall submit
such notice to the Surety no later than 12:00 noon New York City time on the
tenth Business Day preceding such Distribution Date as a claim for a Required
Surety Payment.
(b) Upon receipt of a Required Surety Payment from the Surety on
behalf of the Holders of Class A Certificates, the Trustee shall deposit such
Required Surety Payment in the Distribution Account and shall distribute such
Required Surety Payment, or the proceeds thereof, in accordance with Section
6.01(a).
(c) The Trustee shall (i) receive as attorney-in-fact of each Holder
of Class A Certificates any Required Surety Payment from the Surety and (ii)
disburse the same to the Holders of such Certificates as set forth in Section
6.01(a).
[End of Article VI]
<PAGE>
ARTICLE VII
REPORTS TO BE PREPARED BY MASTER SERVICER
Section 7.01. Master Servicer Shall Provide Information as Reasonably
Required. The Master Servicer shall furnish to the Trustee, the Certificate
Insurer and the Surety and during the term of this Agreement, such periodic,
special, or other reports or information, whether or not provided for herein,
as shall be necessary, reasonable, or appropriate in respect to the Trustee,
the Certificate Insurer or the Surety, as the case may be, or otherwise in
respect to the purposes of this Agreement, all such reports or information to
be as provided by and in accordance with such applicable instructions and
directions as the Trustee, the Certificate Insurer or the Surety, as the case
may be, may reasonably require. The Master Servicer shall file, as necessary,
financing statements and continuation statements as required by the Uniform
Commercial Code and any other applicable law sufficient to create and maintain
a valid perfected security interest in the Trust for the benefit of the
Certificateholders.
Section 7.02. Federal Information Returns and Reports to
Certificateholders. (a) For federal income tax purposes, the taxable year of
the Trust Fund shall be a calendar year and the Master Servicer shall maintain
or cause the maintenance of books of the Trust Fund on the accrual method of
accounting. The books of the Trust Fund shall reflect all payments made with
respect to the Mortgage Loans, and amounts attributable to the Class A
Certificateholders, the Class B Certificateholders, the Class C
Certificateholders and the Class R Certificateholder.
(b) The Trustee shall prepare and file or cause to be filed with the
Internal Revenue Service at the times and in the manner required by the Code
or applicable Treasury Regulations all Federal tax or information returns with
respect to the Trust Fund and the Certificates, which tax or information
returns contain such information as may be required by the Code or applicable
Treasury Regulations. The Trustee also shall furnish to Holders of
Certificates such statements or information at the times and in the manner as
the Code or applicable Treasury Regulations may require such holders to be
furnished, regardless of by whom. For this purpose, the Trustee may, but need
not, rely on any proposed regulations of the United States Department of the
Treasury. The Trustee shall indicate the election to treat the Trust Fund
(exclusive of the Mortgage 100(sm) Pledge Agreements, the Parent Power(R)
Agreements, the Pre-Funding Account (including the funds therein and
Pre-Funding Earnings) and the Carryover Reserve Fund (including the funds
therein)) as two REMICs in such manner as the Code or applicable Treasury
regulations may prescribe. The Trustee shall sign all required tax or
information returns. The initial Class R Certificateholder is hereby
designated as the initial "tax matters person" (within the meaning of Temp.
Treas. Reg. ss. 1.860F-4T(d)). In the event that the Code or applicable
Treasury Regulations prohibit the Trustee from signing tax or information
returns or other statements, or the Master Servicer from acting as tax matters
person (as an agent or otherwise), the Master Servicer shall take whatever
action that in its sole good faith judgment is necessary for the proper filing
of such information returns or for the provision of a tax matters person,
including designation of the Class R Certificateholder to sign such returns.
The Class R Certificateholder shall be bound by this Section 7.02.
[End of Article VII]
<PAGE>
ARTICLE VIII
THE COMPANY AND THE MASTER SERVICER
Section 8.01. Indemnification; Third Party Claims. (a) The Master
Servicer agrees to indemnify the Company, the Certificate Insurer, the Surety
and the Trustee and hold the Company, the Certificate Insurer, the Surety and
the Trustee 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 Company, the Certificate Insurer, the Surety or the
Trustee may sustain as a result of the failure of the Master Servicer to
perform its duties and service the Mortgage Loans in compliance with the terms
of this Agreement; provided that no such indemnification shall be required of
a successor Master Servicer with respect to acts of a prior Master Servicer.
The Master Servicer shall immediately notify the Company, the Certificate
Insurer, the Surety and the Trustee if a claim is made by a third party with
respect to this Agreement or the Mortgage Loans, assume (unless otherwise
directed by the Company, the Certificate Insurer, the Surety and the Trustee)
the defense of any such claim and pay all expenses in connection therewith,
including counsel fees, and promptly pay, discharge and satisfy any judgment
or decree which may be entered against it, the Company or the Trustee in
respect of such claim.
(b) Should any claim or action by a third party arise after the
Closing Date for which the Company, the Certificate Insurer, the Surety or the
Trustee intends to seek indemnification under the terms of Section 8.01(a),
the Company shall notify the Master Servicer in writing within ten (10)
Business Days, and the Trustee, the Certificate Insurer or the Surety shall
notify the Master Servicer in writing promptly, after each such party receives
notice of such claim or action, or notice of a threat that is reasonably
likely to result in such claim or action. The party seeking indemnification
shall give the Master Servicer a reasonable opportunity to participate in any
proceedings to settle or defend any such claim or action. If the Master
Servicer wishes to assume the defense of such claim or action, it shall give
written notice to the party seeking indemnification and the Master Servicer
shall thereafter assume the defense at its own expense. In the event that the
Master Servicer assumes the defense of a claim or action, the party seeking
indemnification will assert or empower the Master Servicer to assert on behalf
of the party seeking indemnification any rights to indemnification that the
party seeking indemnification may have in connection with such claim or
action. The Master Servicer shall have the right to settle any such action
provided that the Master Servicer obtains the consent of the party seeking
indemnification, which consent shall not be unreasonably withheld. The
Company, the Certificate Insurer, the Surety and the Trustee agree to respond
to the Master Servicer's request for consent as promptly as possible and agree
that a failure by the Company, the Certificate Insurer, the Surety or the
Trustee to respond within thirty (30) Business Days shall be taken as consent.
Section 8.02. Merger or Consolidation of the Company or the Master
Servicer; Status of Master Servicer. Subject to the following paragraphs of
this Section 8.02, the Company and the Master 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 in which such qualification is or shall be necessary to protect
the validity and enforceability of this Agreement, the Certificates or any of
the Mortgage Loans and to perform its duties under this Agreement. The Master
Servicer agrees to remain an approved seller/servicer for Fannie Mae or
Freddie Mac in good standing.
Any person into which the Company or the Master Servicer may be
merged or consolidated, or any corporation resulting from any merger,
conversion or consolidation to which the Company or the Master Servicer shall
be a party, or any Person succeeding to the business of the Company or the
Master Servicer, shall be the successor of the Company or the Master Servicer
hereunder, without the execution or filing of any paper or any further act on
the part of any of the parties hereto, anything herein to the contrary
notwithstanding; provided, however, that the successor or surviving Person to
the Master Servicer shall satisfy the requirements of Section 8.05 with
respect to the qualifications of a successor to the Master Servicer.
Notwithstanding anything else in this Section 8.02 and Section 8.04
to the contrary, the Master Servicer may assign its rights and delegate its
duties and obligations under this Agreement; provided that the Person
accepting such assignment or delegation shall be a Person which is qualified
to service mortgage loans on behalf of Fannie Mae or Freddie Mac, is approved
by the Trustee, the Certificate Insurer, the Surety and the Company, is
willing to service the Mortgage Loans and executes and delivers to the
Company, the Certificate Insurer, the Surety and the Trustee an agreement, in
form and substance reasonably satisfactory to the Company, the Certificate
Insurer, the Surety and the Trustee, which contains an assumption by such
Person of the due and punctual performance and observance of each covenant and
condition to be performed or observed by the Master Servicer under this
Agreement; provided further that each Rating Agency's respective ratings of
the Classes of Certificates that have been rated in effect immediately prior
to such assignment and delegation will not be qualified or reduced as a result
of such assignment and delegation. The Master Servicer shall give notice to
the Certificate Insurer and the Surety of any such assignment and delegation.
In the case of any such assignment and delegation, the Master Servicer shall
be released from its obligations as Master Servicer under this Agreement,
except that the Master Servicer shall remain liable for all liabilities and
obligations incurred by it as Master Servicer hereunder prior to the
satisfaction of the conditions to such assignment and delegation set forth in
the second preceding sentence.
Section 8.03. Limitation on Liability of the Company, the Master
Servicer, the Trustee and Others. Neither the Company, the Master Servicer nor
any of the directors, officers, employees or agents of the Company or the
Master Servicer shall be under any liability to the Trustee, the
Certificateholders, the Certificate Insurer or the Surety for any action taken
or for refraining from the taking of any action in good faith pursuant to this
Agreement, or for errors in judgment; provided, however, that this provision
shall not protect the Company, the Master Servicer or any such person against
any breach of warranties or representations made herein, or failure to perform
its obligations in compliance with this Agreement, or any liability which
would otherwise be imposed by reason of any breach of the terms and conditions
of this Agreement. The Company, the Master Servicer, the Trustee and any
director, officer, employee or agent of the Company, the Master Servicer or
the Trustee may rely in good faith on any document of any kind prima facie
properly executed and submitted by any Person respecting any matters arising
hereunder. Neither the Company nor the Master Servicer shall be under any
obligation to appear in, prosecute or defend any legal action which is not
incidental to its respective duties to service the Mortgage Loans in
accordance with this Agreement and which in its opinion may involve it in any
expenses or liability; provided, however, that the Company or the Master
Servicer may in its discretion undertake any such action which it may deem
necessary or desirable in respect to this Agreement and the rights and duties
of the parties hereto. In such event, the legal expenses and costs of such
action and any liability resulting therefrom shall be expenses, costs and
liabilities payable from the Certificate Account and the Company or the Master
Servicer shall be entitled to be reimbursed therefor out of the Certificate
Account as provided by Section 5.09; provided that no such right of
reimbursement shall exist with respect to the Master Servicer when such claim
results from the failure of the Master Servicer to service the Mortgage Loans
in strict compliance with the terms of this Agreement or a breach of a
representation or warranty made by the Master Servicer hereunder or as
Mortgage Loan Seller under the Sale Agreement or the failure of the Master
Servicer to deliver the Mortgage Files to the Custodian in accordance with
this Agreement.
Section 8.04. Company and Master Servicer Not to Resign. Except as
described in Section 8.02, neither the Company nor the Master Servicer shall
assign this Agreement or resign from the obligations and duties hereby imposed
on it except by mutual consent of the Company, the Master Servicer, the
Certificate Insurer, the Surety, the Trustee and Holders of Certificates of
each Class evidencing, as to such Class, Percentage Interests aggregating at
least 66 2/3% unless the determination is made that its duties hereunder are
no longer permissible under applicable law and such incapacity cannot be cured
by the Company or the Master Servicer. Any such determination permitting the
resignation of the Company or the Master Servicer shall be evidenced by an
Opinion of independent Counsel to such effect delivered to the Trustee, the
Certificate Insurer and the Surety which Opinion of Counsel shall be in form
and substance acceptable to the Trustee, the Certificate Insurer and the
Surety. A copy of all consents and any Opinion of Counsel shall be promptly
delivered to the Rating Agencies. Upon any such assignment or resignation, the
Company, or the Master Servicer, as appropriate, shall send notice to all
Certificateholders, the Certificate Insurer and the Surety of the effect of
such assignment or resignation upon the then current rating of the class of
Certificates by the Rating Agency whose rating on such class is then in
effect. No such resignation shall become effective until a successor shall
have assumed the Company's or the Master Servicer's responsibilities and
obligations hereunder in the manner provided in Section 8.05. Any purported
assignment or resignation which does not comply with the requirements of this
Section shall be of no effect.
Section 8.05. Successor to the Master Servicer. In connection with
the termination of the Master Servicer's responsibilities and duties under
this Agreement pursuant to Section 8.04 or 9.01, the Trustee shall (i) succeed
to and assume all of the Master Servicer's responsibilities, rights, duties
and obligations as Master Servicer arising thereafter (but not in any other
capacity) under this Agreement (except that the Trustee shall not be obligated
to make Advances if prohibited by applicable law or regulation and except that
the Trustee makes no representations and warranties of the Master Servicer
pursuant to Section 3.01 or otherwise hereunder) and shall have no duty or
obligation to purchase or repurchase any Mortgage Loans (except that the
Trustee, as successor Master Servicer, may elect pursuant to Section 3.04(f)
to be obligated to make such purchases) and shall have the same indemnities
and be entitled to all Servicing Fees and funds to which the Master Servicer
would have been entitled as Master Servicer or (ii) appoint a successor having
a net worth of not less than $10,000,000 and which is a Fannie Mae or Freddie
Mac approved seller/servicer or FHA approved mortgagee in good standing and
which shall succeed to all rights and assume all of the responsibilities,
duties and liabilities of the Master Servicer under this Agreement prior to
the termination of Master Servicer's responsibilities, duties and liabilities
under this Agreement. A successor Master Servicer other than the Trustee shall
make the representations and warranties in Section 3.01(a) to the extent that
such representations and warranties relate to its corporate existence or its
servicing of the Mortgage Loans hereunder. Neither the Trustee nor any other
successor Servicer shall be deemed to be in default hereunder by reason of any
failure to make, or any delay in making any distribution hereunder or any
portion thereof caused by (i) the failure of the Master 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
Master Servicer. If the Trustee has become the successor to the Master
Servicer in accordance with this Section or Section 9.03, then notwithstanding
the above, the Trustee may, if it shall be unwilling to so act, or shall, if
it is unable to so act, appoint, or petition a court of competent jurisdiction
to appoint, any established housing and home finance institution having a net
worth of not less than $15,000,000 and which is a Fannie Mae or Freddie Mac
approved seller/servicer or FHA approved mortgagee in good standing as the
successor to the Master Servicer hereunder in the assumption of all or any
part of the responsibilities, duties or liabilities of the Master Servicer
hereunder. In connection with any 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 or such court
shall determine; provided, however, that no such compensation shall be in
excess of that permitted under this Agreement without the consent of all of
the Certificateholders, the Certificate Insurer and the Surety. If the Master
Servicer's duties, responsibilities and liabilities under this Agreement
should be terminated pursuant to Section 8.02, 8.04, 9.01 or 11.02, the Master
Servicer shall discharge such duties and responsibilities during the period
from the date it acquires knowledge of such termination until the effective
date thereof with the same degree of diligence and prudence which it is
obligated to exercise under this Agreement, and shall take no action
whatsoever that might impair or prejudice the rights or financial condition of
its successor. The resignation or removal of the Master Servicer pursuant to
Section 8.02, 8.04, 9.01 or 11.02 shall not become effective until a successor
shall be appointed pursuant to this Section and shall in no event relieve the
Master Servicer of liability for breach of the representations and warranties
made pursuant to Section 3.01.
Any successor appointed as provided herein shall execute, acknowledge
and deliver to the Master Servicer and to the Trustee an instrument accepting
such appointment, whereupon such successor shall become fully vested with all
the rights, powers, duties, responsibilities, obligations and liabilities of
the Master Servicer, with like effect as if originally named as a party to
this Agreement and the Certificates. Any termination or resignation of the
Master Servicer or this Agreement pursuant to Section 8.02, 8.04, 9.01, or
11.02 shall not affect any claims that the Trustee may have against the Master
Servicer arising prior to any such termination or resignation.
The Master Servicer shall timely deliver to the successor the funds
that were, or were required to be, in the Certificate Account and the Escrow
Account, if any, and all Mortgage Files and related documents and statements
held by it hereunder and the Master Servicer shall account for all funds and
shall execute and deliver such instruments and do such other things as may
reasonably be required to more fully and definitely vest and confirm in the
successor all such rights, powers, duties, responsibilities, obligations and
liabilities of the Master Servicer.
Upon a successor's acceptance of an appointment as such, the Master
Servicer shall notify in writing the Trustee, the Certificateholders, the
Rating Agency, the Certificate Insurer and the Surety of such appointment.
Section 8.06. Maintenance of Ratings. The Master Servicer shall
cooperate with the Company and take any action that may be reasonably
necessary to maintain the current rating or ratings on the Class A
Certificates. To the extent not otherwise provided herein, the Master Servicer
shall provide to each Rating Agency notice with respect to any (i) insurance
claims and recoveries, (ii) monthly Mortgage Loan reports, (iii) accounting
and compliance reports with respect to the Mortgages, (iv) Mortgage Loan
repurchases or substitution, (v) monthly shortfalls as a result of a failure
to make advances, (vi) final payment to Certificateholders, (vii) transfers of
the Class B, Class C or Class R Certificates and (viii) the reports and
statements delivered pursuant to Sections 5.25 and 5.26.
[End of Article VIII]
<PAGE>
ARTICLE IX
DEFAULT
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Section 9.01. Events of Default. If one or more of the following
Events of Default shall occur and be continuing:
(i) any failure by the Master Servicer to remit to the Trustee
or the Paying Agent, or any failure to cause the Paying Agent to
make, any payment or Advance required to be made or distributed under
the terms of this Agreement (including but not limited to an Advance
pursuant to Section 6.03); provided that if the Master Servicer is
using its reasonable best efforts to so remit, or cause the Trustee
or Paying Agent to make, any such payment or Advance, then such
failure shall be an Event of Default only if such failure continues
unremedied for a period of five days after the date upon which
written notice of such failure, requiring the same to be remedied,
shall have been given to the Master Servicer by the Trustee, the
Certificate Insurer, the Surety or the Company or to the Master
Servicer, the Trustee, the Certificate Insurer, the Surety and the
Company by the Holders of Certificates of all Classes evidencing not
less than 25% of the Trust Fund (based on the outstanding principal
balances of the Certificates), the Certificate Insurer or Surety; or
(ii) if the written notice described in paragraph (i) above has
been given twice during any twelve-month period, any subsequent
failure during such twelve-month period to remit to the Trustee or
the Paying Agent, or cause the Paying Agent to make, any payment
required to be made or distributed under the terms of this Agreement
other than for reasons outside of the Master Servicer's control; or
(iii) failure on the part of the Master Servicer duly to
observe or perform in any material respect any other of the covenants
or agreements on the part of the Master Servicer set forth in this
Agreement, which continues unremedied for a period of 60 days after
the date on which written notice of such failure, requiring the same
to be remedied, shall have been given to the Master Servicer by the
Trustee, the Certificate Insurer, the Surety or the Company or to the
Master Servicer, the Trustee, the Certificate Insurer, the Surety and
the Company by the Holder of Certificates of Classes evidencing not
less than 25% of the Trust Fund (based on the outstanding principal
balances of the Certificates), the Certificate Insurer or the Surety;
or
(iv) a decree or order of a court or agency or supervisory
authority having jurisdiction for the appointment of a trustee,
conservator, receiver, liquidator, assignee, custodian or
sequestrator (or other similar official) for the Master Servicer or
any substantial part of its property in any federal or state
bankruptcy, insolvency, readjustment of debt, marshalling of assets
and liabilities or similar proceedings, or for the winding-up or
liquidation of its affairs, shall have been entered against the
Master Servicer and such decree or order shall have remained in force
undischarged or unstayed for a period of 60 days; or
(v) the Master Servicer shall consent to the appointment of a
trustee, conservator, receiver, liquidator, assignee, custodian or
sequestrator (or other similar official) in, or commence a voluntary
case under any federal or state bankruptcy insolvency, readjustment
of debt, marshalling of assets and liabilities or similar proceedings
of or relating to the Master Servicer or of or relating to all or
substantially all of the Master Servicer's property; or
(vi) the Master Servicer shall admit in writing its inability
to pay its debts generally as they become due, file a petition to
take advantage of any applicable insolvency or reorganization
statute, make an assignment for the benefit of its creditors, or
voluntarily suspend payment of its obligations;
then, and in each and every such case, so long as an Event of Default shall
not have been remedied, the Trustee shall notify the Certificateholders, the
Certificate Insurer, the Surety and each Rating Agency of such Event of
Default. Subject to Section 5.01(b), the Trustee may (with the consent of the
Certificate Insurer and the Surety), and at the written direction of the
Certificate Insurer, the Surety or the Holders of Certificates evidencing not
less than 25% of the Trust Fund (with the consent of the Certificate Insurer
and the Surety), shall, by notice in writing to the Master Servicer, in
addition to whatever rights the Trustee may have at law or equity to damages,
including injunctive relief and specific performance, terminate all the rights
and obligations of the Master Servicer under this Agreement and in and to the
Mortgage Loans and the proceeds thereof. On or after the receipt by the Master
Servicer of such written notice, all authority and power of the Master
Servicer under this Agreement, whether with respect to the Mortgage Loans or
otherwise, shall pass to and be vested in the successor appointed pursuant to
Section 8.05. Upon written request from the Trustee, the Master Servicer shall
prepare, execute and deliver, any and all documents and other instruments,
place in such successor's possession all Mortgage Files and do or accomplish
all other acts or things necessary or appropriate to effect the purposes of
such notice of termination, whether to complete the transfer and endorsement
or assignment of the Mortgage Loans and related documents, or otherwise, at
the Master Servicer's sole expense. The Master Servicer agrees to cooperate
with the Trustee and such successor in effecting the termination of the Master
Servicer's responsibilities and rights hereunder, including, without
limitation, the transfer to such successor for administration by it of all
cash amounts which shall at the time be credited by the Master Servicer to the
Certificate Account or Escrow Account or thereafter received with respect to
the Mortgage Loans.
Section 9.02. Waiver of Defaults. The Trustee may, with the consent
of the Certificate Insurer and the Surety, and shall at the direction of the
Certificate Insurer and the Surety, waive any default by the Master Servicer
in the performance of its obligations hereunder and its consequences, except
that a default in the making of any required distribution on any of the
Certificates may only be waived by the affected Certificateholders, the
Certificate Insurer and the Surety. Upon any such waiver of a past default,
such default shall cease to exist, and any Event of 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 contingent thereon except to the extent expressly so waived.
Section 9.03. Trustee or Company to Act; Appointment of Successor. On
and after the time the Master Servicer receives a notice of termination
pursuant to Section 9.01, the Trustee or its appointed agent shall be the
successor in all respects to the Master Servicer to the extent provided in
Section 8.05.
Section 9.04. Notification to Certificateholders. (a) Upon any such
termination pursuant to Section 9.01, the Trustee shall give prompt written
notice thereof to Certificateholders at their respective addresses appearing
in the Certificate Register and to each Rating Agency, the Certificate Insurer
and the Surety.
(b) Within 60 days after obtaining actual knowledge of the occurrence
of any Event of Default, the Trustee shall transmit by mail to all Holders of
Certificates notice of each such Event of Default hereunder known to the
Trustee, unless such Event of Default has been cured or waived.
[End of Article IX]
<PAGE>
ARTICLE X
CONCERNING THE TRUSTEE
Section 10.01. Duties of Trustee. The Trustee, prior to the
occurrence of an Event of Default and after the curing of all Events of
Default which may have occurred, undertakes to, and is empowered to, perform
such duties and only such duties as are specifically set forth in this
Agreement. Any permissive right of the Trustee as enumerated in this Agreement
shall not be construed as a duty; provided that in case an Event of Default
has occurred (which has not been cured), the Trustee shall exercise such of
the rights and powers vested in it by this Agreement, and use the same degree
of care and skill in their exercise as a prudent man would exercise or use
under the circumstances in the conduct of such man'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.
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 intentional misconduct, and, if the Trustee is acting as the
successor Master Servicer pursuant to Section 8.05 or 9.03, its own willful
misconduct with respect to its servicing obligations; provided, however, that:
(i) Prior to the occurrence of an Event of Default, and after
the curing of all such Events of Default 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 liable for an error of judgment
made in good faith by a Responsible Officer or Responsible Officers
of the Trustee, unless it shall be proved that the Trustee was
negligent in ascertaining the pertinent facts; and
(iii) The Trustee shall not be liable with respect to any
action taken, suffered or omitted to be taken by it in good faith in
accordance with the direction of Certificateholders of any Class
holding Certificates which evidence at least 25% of the Trust Fund
(on the basis of the outstanding principal balances of the
Certificates) with the consent of the Certificate Insurer and the
Surety as to the time, method and place of conducting any proceeding
for any remedy available to the Trustee, or exercising any trust or
power conferred upon the Trustee, under this Agreement.
Section 10.02. Certain Matters Affecting the Trustee. Except as
otherwise provided in Section 10.01:
(i) The Trustee may request and rely upon and shall be
protected in acting or refraining from acting upon any resolution,
Officers' Certificate, certificate of auditors or any other
certificate, statement, instrument, opinion, report, notice, request,
consent, order, appraisal, bond or other paper or document believed
by it to be genuine and to have been signed or presented by the
proper party or parties;
(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 any litigation hereunder or in relation
hereto at the request, order or direction of any of the
Certificateholders, pursuant to the provisions of this Agreement,
unless such Certificateholders shall have offered to the Trustee
reasonable security or indemnity 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 an Event of 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
their 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 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 an Event of Default hereunder
and after the curing of all Events of Default which may have
occurred, the Trustee shall not be bound to make any investigation
into the fact or matters stated in any resolution, certificate,
statement, instrument, opinion, report, notice, request, consent,
order, approval, bond or other paper or document, unless requested in
writing so to do by Holders of Certificates of any Class evidencing
at least 25% of the Trust Fund (on the basis of the outstanding
principal balances of the 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 such proceeding. The
reasonable expense of every such examination shall be paid by the
Master Servicer, if an Event of Default shall have occurred and is
continuing, and otherwise by the Certificateholder requesting the
investigation; and
(vi) The Trustee may execute any of the trusts or powers
hereunder or perform any duties hereunder either directly or by or
through agents or attorneys.
Section 10.03. Trustee Not Liable for Certificates or Mortgage Loans.
The recitals contained herein and in the Certificates shall be taken as the
statements of the Company or the Master Servicer, as the case may be, and the
Trustee assumes no responsibility for their correctness. The Trustee makes no
representations or warranties as to the validity or sufficiency of this
Agreement or of the Certificates (except that the Certificates shall be duly
and validly authenticated by it) or of any Mortgage Loan or related document.
The Trustee shall not be accountable for the use or application by the Company
or the Master Servicer of any of the Certificates or of the proceeds of such
Certificates, or for the use or application of any funds paid to the Company
or the Master Servicer in respect of the Mortgage Loans or deposited in or
withdrawn from the Certificate Account by the Company or the Master Servicer.
Section 10.04. 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.
Section 10.05. Master Servicer to Pay Trustee's Fees and Expenses.
The Master 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 trust hereby created and in the exercise and performance of
any of the powers and duties hereunder of the Trustee, and the Master Servicer
will pay or reimburse the Trustee upon its request for all reasonable
expenses, disbursements and advances incurred or made by the Trustee in
accordance with any of the provisions of this Agreement (including the
reasonable compensation and the expenses and disbursements of its counsel and
of all persons not regularly in its employ, and the expenses incurred by the
Trustee in connection with the appointment of an office or agency pursuant to
Section 10.11) and indemnify and hold the Trustee harmless from any such loss,
liability or expense except any such expense, disbursement or advance as may
arise from its negligence or bad faith. The Trustee and any officer, director,
agent or employee of the Trustee shall be indemnified by the Master Servicer
and held harmless against any loss, liability or expense incurred in
connection with any claim or legal action relating to this Agreement, the
Insurance Agreement or the Certificates, or the performance of any of the
Trustee's duties in accordance with the terms of this Agreement or the
Insurance Agreement, other than any loss, liability or expense that is
incurred by reason of willful misfeasance, bad faith or negligence of the
Trustee. Notwithstanding anything to the contrary in this Agreement, the
provisions of this Section shall survive the termination or assignment of this
Agreement and the resignation or removal of the Trustee herein. Upon the
resignation or removal of the Trustee, the Trustee shall only be entitled to
its trustee's fees accrued up to the time of such resignation or removal and
shall thereafter not be entitled to any additional trustee's fees.
Section 10.06. Eligibility Requirements for Trustee. The Trustee
hereunder shall at all times be a corporation or association having its
principal office in a state and city acceptable to the Company and organized
and doing business under the laws of such state or the United States of
America, authorized under such laws to exercise corporate trust powers, having
a combined capital and surplus of at least $50,000,000 and subject to
supervision or examination by federal or state authority. The Trustee shall
not be an affiliate of the Mortgage Loan Seller or the Company. If such
corporation 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 the combined capital and surplus of such
corporation shall be deemed to be its combined capital and surplus as set
forth in its most recent report of condition so published. In case at any time
the Trustee shall cease to be eligible in accordance with the provisions of
this Section, the Trustee shall resign immediately in the manner and with the
effect specified in Section 10.07.
Section 10.07. 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 Company, the Master Servicer, any
Sub-Servicer, the Certificate Insurer, the Surety and the Rating Agency. Upon
receiving such notice of resignation, the Company shall promptly appoint a
successor trustee by written instrument, in duplicate, one copy of which
instrument shall be delivered to the resigning Trustee and one copy to the
successor trustee; provided that such appointment does not result in a
reduction or withdrawal of the rating of the Class A Certificates, and
provided further, that, so long as such consent is not unreasonably withheld,
the Certificate Insurer and the Surety consents to such appointment. The
Company shall make a good faith effort to appoint a successor within 30 days
of its receipt of such notice. If the Company does not appoint a successor
Trustee within such 30 day period and it is not making a good faith effort to
appoint a successor Trustee, then the Certificate Insurer or the Surety may
appoint a successor Trustee. The Master Servicer shall indemnify the Trustee
for any loss, liability, or expense incurred as a result of the Company's
failure to make a good faith effort to appoint a successor Trustee. If no
successor trustee shall have been so appointed and have accepted appointment
within 30 days after the giving of such notice of resignation, the resigning
Trustee may petition any court of competent jurisdiction for the appointment
of a successor trustee.
If at any time (i) the Trustee shall cease to be eligible in
accordance with the provisions of Section 10.06, (ii) the Company has
delivered to the Trustee a letter from any Rating Agency to the effect that
the rating of the Class A Certificates has been or is about to be reduced or
withdrawn on account of a reduction in the long-term credit rating of the
Trustee or the parent of the Trustee (if (a) the Trustee proposes to the
Company and the Master Servicer to enter into an agreement with the Trustee,
and the Company and the Master Servicer, each in its sole discretion, elect to
enter into such agreement and (b) such agreement is consented to by the
Certificate Insurer and the Surety Provider and is satisfactory to the Rating
Agencies without resulting in a reduction in or withdrawal of any rating of
the Class A Certificates, then upon the execution and delivery of such
agreement the Company shall not request such resignation pursuant to this
clause (ii)), and the Trustee shall fail to resign after written request
therefor by the Company, or (iii) 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 Company may
remove the Trustee and appoint a successor trustee by written instrument, in
duplicate, one copy of which instrument shall be delivered to the Trustee so
removed and one copy to the successor trustee.
The Holders of Certificates evidencing in the aggregate more than 50%
of the Trust Fund (on the basis of the outstanding principal balances of the
Certificates) may at any time remove the Trustee and appoint a successor
trustee by written instrument or instruments, in triplicate, signed by such
Holders or their attorneys-in-fact duly authorized, one complete set of which
instruments shall be delivered to the Company, one complete set to the Trustee
so removed and one complete set to the successor 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 10.08.
Section 10.08. Successor Trustee. Any successor trustee appointed as
provided in Section 10.07 shall execute, acknowledge and deliver to the
Company 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 Mortgage Files and related
documents and statements held by it hereunder, and the Company, the Master
Servicer and the predecessor trustee shall execute and deliver such
instruments and do such other things as may reasonably be required for more
fully and certainly vesting and confirming in the successor trustee all such
rights, powers, duties and obligations.
No successor trustee shall accept appointment as provided in this
Section unless at the time of such acceptance such successor trustee shall be
eligible under the provisions of Section 10.06 and the Company shall have
received written notice from the Rating Agency that the appointment of the
successor trustee will not result in reduction of the then current rating on
the Class A Certificates.
Upon acceptance of appointment by a successor trustee as provided in
this Section, the Company shall mail notice of the succession of such trustee
hereunder to all Holders of Certificates at their addresses as shown in the
Certificate Register, and to each Rating Agency, the Master Servicer, any
Sub-Servicer, the Certificate Insurer, and the Surety. If the Company fails to
mail such notice within 10 days after acceptance of appointment by the
successor trustee, the successor trustee shall cause such notice to be mailed
at the expense of the Company.
Section 10.09. Merger or Consolidation of Trustee. Any corporation or
national banking association 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 10.06, 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 10.10. 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
Company and the Trustee acting jointly shall have the power and shall execute
and deliver all instruments to appoint one or more Persons approved by the
Trustee to act as co-trustee or co-trustees, jointly with the Trustee, of 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 10.10, such powers, duties, obligations,
rights and trusts as the Company and the Trustee may consider necessary or
desirable. If the Company shall not have joined in such appointment within 15
days after the receipt by it of a request so to do, or in case an Event of
Default shall have occurred and be continuing, the Trustee alone shall have
the power to make such appointment. No co-trustee or separate trustee
hereunder shall be required to meet the terms of eligibility as a successor
trustee under Section 10.06 hereunder and no notice to Holders of Certificates
of the appointment of co-trustee(s) or separate trustee(s) shall be required
under Section 10.08 hereof. No co-trustee shall be obligated to make any
Advances required pursuant to Section 6.03(b).
In the case of any appointment of a co-trustee or separate trustee
pursuant to this Section 10.10 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 Master Servicer hereunder), the Trustee shall be
incompetent or unqualified to perform such act or acts, in which event such
rights, powers, duties and obligations (including the holding of title to the
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 X. 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 it
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 10.11. Appointment of Office or Agency. The Trustee may
appoint an office or agency in the City of New York where Certificates may be
surrendered for registration of transfer or exchange. As of the Closing Date,
the Trustee designates its offices located at 123 Washington Street, New York,
New York 10006 for purposes of surrendering Certificates for registration,
transfer, exchange or termination. The Trustee will maintain an office at the
address stated in Section 12.07 hereof where notices and demands to or upon
the Trustee in respect of the Certificates may be served.
[End of Article X]
<PAGE>
ARTICLE XI
TERMINATION
Section 11.01. Termination. The respective obligations and
responsibilities of the Company, the Master Servicer and the Trustee (except
the duty to pay the Trustee's fees and expenses and indemnification hereunder)
shall terminate (i) upon the later of the final payment or other liquidation
(or any advance with respect thereto) of the last Mortgage Loan or the
disposition of all property acquired upon foreclosure or deed in lieu of
foreclosure of any Mortgage Loan and the remittance of all funds due hereunder
(including without limitation any Distribution Account Shortfall) or (ii) at
the option of the Master Servicer, on any Distribution Date which occurs in
the month next following a Due Period in which the aggregate unpaid Principal
Balance of all Outstanding Mortgage Loans (less the Formula Principal
Distribution Amount for such Distribution Date) is less than 10% of the
aggregate unpaid Principal Balance of the Mortgage Loans on the Cut-off Date
and the Subsequent Mortgage Loans as of their respective Subsequent Cut-off
Dates, so long as the Master Servicer deposits or causes to be deposited in
the Certificate Account during the Due Period related to such Distribution
Date an amount equal to the greatest of (A) the Purchase Price for each
Mortgage Loan, and, with respect to all property acquired in respect of any
Mortgage Loan remaining in the Trust Fund, an amount equal to the appraised
value of such property (less, if the purchaser is the Master Servicer, any
unreimbursed Advances made by the Master Servicer, which Advances shall
thereupon be deemed reimbursed to the Master Servicer), such appraisal to be
conducted by an appraiser selected by the Master Servicer, (B) the aggregate
fair market value (as determined by the Master Servicer as of the close of
business on the last Business Day of such Due Period) of all of the assets of
the Trust Fund (less, if the purchaser is the Master Servicer, any
unreimbursed Advances made by the Master Servicer, which Advances shall
thereupon be deemed reimbursed to the Master Servicer), plus, in each case,
one month's interest at the applicable Net Mortgage Rate on the Principal
Balance of each Mortgage Loan (including any Mortgage Loan as to which title
to the underlying Mortgaged Property has been acquired) and (C) the sum of (1)
the aggregate of the Class A Principal Balance, together with one month's
interest on the Class A Principal Balance at the Class A Pass-Through Rate,
and any Class A Unpaid Interest Shortfall, (2) the sum of the Class B
Principal Balance, together with one month's interest on the Class B Principal
Balance at the Class B Pass-Through Rate and any Class B Unpaid Interest
Shortfall, and (3) any amounts owed to the Certificate Insurer and the Surety
hereunder; provided, however, that in no event shall the trust created hereby
continue beyond the expiration of 21 years from the death of the last survivor
of the descendants of Joseph P. Kennedy, the late ambassador of the United
States to the Court of St. James's, living on the date hereof. The amount
calculated pursuant to clause (ii)(C) above does not include any Class C
Unpaid Interest Shortfall.
Notice of any termination, specifying the Distribution Date upon
which all Certificateholders may surrender their Certificates to the Trustee
for payment and cancellation, shall be given promptly by the Trustee (upon
direction by the Company 10 days prior to the date such notice is to be
mailed) by letter to Certificateholders, the Certificate Insurer, the Surety
and the Rating Agency mailed no later than the 25th day of the month preceding
the month of such final distribution specifying (i) the Distribution Date upon
which final payment on the Certificates will be made upon presentation and
surrender of Certificates at the office or agency of the Trustee therein
designated, (ii) the amount of any such final payment and (iii) that the
Record Date otherwise applicable to such Distribution Date is not applicable,
payments being made only upon presentation and surrender of the Certificates
at the office or agency of the Trustee therein specified. Such notice shall be
accompanied by an Opinion of Counsel provided by the Master Servicer at its
expense that such plan is a "qualified liquidation" under the REMIC Provisions
and shall constitute the adoption by the Trustee on behalf of the
Certificateholders of a plan of complete liquidation within the meaning of
section 860F(a)(4) of the Code. After giving such notice, the Trustee shall
not register the transfer or exchange of any Certificates. If such notice is
given in connection with the Master Servicer's election to repurchase, the
Master Servicer shall cause to be deposited in the Distribution Account during
the applicable Due Period an amount equal to the above-described purchase
price and on the Distribution Date on which such termination is to occur,
Certificateholders will be entitled to the amount of such purchase price but
not amounts in excess thereof, all as provided herein. Upon presentation and
surrender of the Certificates, the Trustee shall notify the Paying Agent and
the Paying Agent shall distribute from the Distribution Account to
Certificateholders an amount equal to (a) the amount otherwise distributable
on such Distribution Date, if not in connection with a purchase; or (b) if the
Master Servicer elected to so purchase, the purchase price calculated as
provided above. Following such final deposit the Custodian, pursuant to the
Custodial Agreement, shall promptly release to the Master Servicer the
Mortgage Files for the remaining Mortgage Loans, and the Trustee shall execute
all assignments, endorsements and other instruments necessary to effectuate
such transfer and shall have no further responsibility with regard to said
Mortgage Files.
If all of the Certificateholders shall not surrender their
Certificates for cancellation within three months after the time specified in
the above-mentioned written notice, the Paying Agent shall on such date cause
all funds in the Distribution Account not distributed in final distribution to
Certificateholders to be withdrawn therefrom and credited to the remaining
Certificateholders by depositing such funds in a separate escrow account for
the benefit of such Certificateholders, and the Trustee shall give a second
written notice to the remaining Certificateholders to surrender their
Certificates for cancellation and receive the final distribution with respect
thereto. If within three months after the second notice all the Certificates
shall not have been surrendered for cancellation, the Trustee shall appoint an
agent to take appropriate and reasonable steps to contact the remaining
Certificateholders concerning surrender of their Certificates, and the cost
thereof shall be paid out of the funds and other assets which remain in the
Trust Fund hereunder. Subject to applicable laws with respect to escheat of
funds, any money held in the separate escrow account for the benefit of the
remaining Certificateholders and remaining unclaimed for one year after the
second notice has been given shall be discharged from the Trust Fund and be
paid to the Class R Certificateholder; and the remaining Certificateholders
shall thereafter, as unsecured general creditors, look only to the Class R
Certificateholder for payment thereof (but only to the extent of the amounts
so paid to the Class R Certificateholder), and all liability of the Trustee
and the Paying Agent with respect to such trust money shall thereafter cease.
Section 11.02. Additional Termination Requirements. ( ) In the event
the Master Servicer exercises its repurchase option as provided in Section
11.01, the Trust Fund shall be terminated in accordance with the following
additional requirements, unless the Trustee has received an Opinion of
Independent 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 the Trust Fund as defined
in Section 860F of the Code, or (ii) cause the Trust Fund (exclusive of the
Mortgage 100(sm) Pledge Agreements, the Parent Power(R) Agreements, the
Pre-Funding Account (including the funds therein and Pre-Funding Earnings) and
the Carryover Reserve Fund (including the funds therein)) to fail to qualify
as two REMICs at any time that any Certificates are outstanding:
(i) The Master Servicer shall establish a 90-day liquidation
period in a statement attached to the final tax returns of the Trust
Fund pursuant to Treasury Regulation ss. 1.860F-1. The Master
Servicer shall satisfy all requirements of a qualified liquidation
under Section 860F of the Code and any regulations thereunder, as
evidenced by an Independent Opinion of Counsel obtained at the
expense of the Master Servicer;
(ii) During such 90-day liquidation period, and at or prior to
the Distribution Date for the final distribution, the Trustee shall
sell all of the assets of the Trust Fund to the Master Servicer for
cash; and
(iii) At the time of the final payment on the Class A and Class
B Certificates, the Trustee shall distribute or credit, or cause to
be distributed or credited, to the Class R Certificateholder all
remaining available cash (other than cash retained to meet claims)
and property in the Trust Fund, and the Trust Fund shall terminate at
that time.
(b) By their acceptance of the Class R Certificate, the Holder
thereof hereby authorizes the Master Servicer to specify the 90-day
liquidation period, which authorization shall be binding upon all successor
Holders of the Class R Certificate.
Section 11.03. Termination By Certificate Insurer or Surety. In the
event the Master Servicer does not exercise its option to terminate the Trust
Fund pursuant to this Article, the Certificate Insurer or the Surety may do so
on the same terms.
[End of Article XI]
<PAGE>
ARTICLE XII
MISCELLANEOUS PROVISIONS
Section 12.01. Severability of Provisions. If any one or more of the
covenants, agreements, provisions or terms of this Agreement shall be for any
reason whatsoever held invalid, then such covenants, agreements, provisions or
terms shall be deemed severable from the remaining covenants, agreements,
provisions or terms of this Agreement and shall in no way affect the validity
or enforceability of the other provisions of this Agreement.
Section 12.02. Limitation on Rights of Certificateholders. The death
or incapacity of any Certificateholder shall not operate to terminate this
Agreement or the Trust Fund, nor entitle such Certificateholder's legal
representatives or heirs to claim an accounting or to take any action or
proceeding in any court for a partition or winding-up of the Trust Fund, nor
otherwise affect the rights, obligations, and liabilities of the parties
hereto or any of them.
No Certificateholder shall have any right to vote (except as
expressly provided herein) or in any manner otherwise control the operation
and management of the Trust Fund, or the obligations of the parties hereto,
nor shall anything herein set forth, or contained in the terms of the
Certificates, be construed so as to constitute the Certificateholders from
time to time as partners or members of an association; nor shall any
Certificateholder be under any liability to any third person by reason of any
action taken by the parties to this Agreement pursuant to any provision
hereof.
No Certificateholder shall have any right by virtue of any provision
of this Agreement to institute any suit, action or proceeding in equity or at
law upon or under or with respect to this Agreement, the Certificate Insurance
Policy or the Certificate Guaranty Surety Bond, unless such Holder previously
shall have given to the Trustee a written notice of default and of the
continuance thereof, as hereinbefore provided, and the Holders of Certificates
evidencing in the aggregate not less than 25% of the Trust Fund (on the basis
of the principal balances of the Certificates) shall have made written request
upon the Trustee to institute such action, suit or proceeding in its own name
as Trustee hereunder and shall have offered to the Trustee such reasonable
indemnity as it may require against the costs, expenses and liabilities to be
incurred therein or thereby, and the Trustee, for 60 days after its receipt of
such notice, request and offer of indemnity, shall have neglected or refused
to institute any such action, suit or proceeding; it being understood and
intended, and being expressly covenanted by each Certificateholder with every
other Certificateholder and the Trustee, that no one or more Holders of
Certificates of any Class shall have any right in any manner whatever by
virtue of any provision of this Agreement to affect, disturb or prejudice the
rights of the Holders of any other of such Certificates of such Class or any
other Class, or to obtain or seek to obtain priority over or preference to any
other such Holder, or to enforce any right under this Agreement, except in the
manner herein provided and for the common benefit of Certificateholders of
such Class or all Classes, as the case may be. For the protection and
enforcement of the provisions of this Section, each and every
Certificateholder and the Trustee shall be entitled to such relief as can be
given either at law or in equity.
Section 12.03. Amendment. This Agreement may be amended from time to
time by the Company, the Master Servicer and the Trustee, with the consent of
the Certificate Insurer and the Surety so long as such consent is not
unreasonably withheld and without the consent of any of the
Certificateholders, (i) to cure or correct any ambiguity, mistake or error,
(ii) to correct or supplement any provisions herein which may be inconsistent
with any other provisions herein or with the Prospectus Supplement or
Prospectus pursuant to which the Class A Certificates were offered, (iii) to
obtain a rating by a nationally recognized rating agency or to maintain or
improve the rating of the Class A Certificates then given by a rating agency
(it being understood that, after obtaining the rating of the Class A
Certificates at the Closing Date, none of the Trustee, the Company or the
Master Servicer is obligated to obtain, maintain or improve any rating of any
Class of Certificates), or (iv) to make any other provisions with respect to
matters or questions arising under this Agreement which shall not be
materially inconsistent with the provisions of this Agreement, including
without limitation provisions relating to the issuance of Definitive
Certificates to Certificate Owners if book-entry registration of the Class A
Certificates is no longer permitted; provided that, in the case of clause
(iv), such action shall not, as evidenced by an Opinion of Independent
Counsel, adversely affect in any material respect the interests of any
Certificateholder.
This Agreement may also be amended from time to time by the Company,
the Master Servicer and the Trustee, with the consent of the Holders of
Certificates of each Class affected thereby, evidencing, as to each such
Class, Percentage Interests aggregating not less than 66% and the consent of
the Certificate Insurer and the Surety, for the purpose of adding any
provisions to or changing in any manner or eliminating any of the provisions
of this Agreement or of modifying in any manner the rights of the Holders of
Certificates of such Class; provided, however, that no such amendment shall
(i) 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 (ii)
reduce the aforesaid percentage of Certificates of any class the Holders of
which are required to consent to any such amendment, without the consent of
the Holders of all Certificates of such Class then outstanding.
The Company, the Master Servicer and the Trustee, may from time to
time amend this Agreement without the consent of any of the
Certificateholders, the Certificate Insurer or the Surety to modify, eliminate
or add to any of the provisions hereof to the extent necessary to maintain the
qualification of the Trust Fund (exclusive of the Mortgage 100(sm) Pledge
Agreements, the Parent Power(R) Agreements, the Pre-Funding Account (including
the funds therein and Pre-Funding Earnings) and the Carryover Reserve Fund
(including the funds therein)) as two REMICs or to avoid the imposition of any
material tax liability thereon at all times that any Certificate is
outstanding.
Promptly after the execution of any such amendment the Trustee shall
furnish written notification of such amendment to each Certificateholder, the
Certificate Insurer, the Surety and the Rating Agencies (with a copy of the
amendment itself to Standard & Poor's).
It shall not be necessary for the consent of Certificateholders under
this Section 12.03 to approve the particular form of any proposed amendment
but it shall be sufficient if such consent shall approve the substance
thereof. The manner of obtaining such consents and of evidencing the
authorization of the execution thereof by Certificateholders shall be subject
to such reasonable regulations as the Trustee may prescribe.
Notwithstanding any provisions of this Agreement, the Trustee shall
not consent to any amendment to this Agreement unless it shall first receive
an Opinion of Counsel to the effect that such amendment will not result in the
imposition of a tax on the Trust Fund or cause the Trust Fund (exclusive of
the Mortgage 100(sm) Pledge Agreements, the Parent Power(R) Agreements, the
Pre-Funding Account (including the funds therein and Pre-Funding Earnings) and
the Carryover Reserve Fund (including the funds therein)) to fail to qualify
as two REMICs at any time that any Certificates are outstanding. In no event
shall any Opinion of Counsel provided pursuant to this Section 12.03 be an
expense of the Trustee.
Section 12.04. The Certificate Insurer; Surety. The Certificate
Insurer is a third-party beneficiary of this Agreement. Any right conferred to
the Certificate Insurer shall be suspended during any period in which the
Certificate Insurer is in default in its payment obligations under the
Certificate Insurance Policy. During any period of suspension the Certificate
Insurer's rights thereunder shall vest in the Holders of the Class A
Certificates and shall be exercisable by the Holders of at least a majority in
Percentage Interest of the Class A Certificates then Outstanding. At such time
as the Class A Certificates are no longer Outstanding hereunder and the
Certificate Insurer has been reimbursed for all Insured Payments to which it
is entitled hereunder and has been paid all Premium Amounts due and owing
under the Insurance Agreement, the Certificate Insurer's rights hereunder
shall terminate.
The Surety is a third-party beneficiary of this Agreement. Any right
conferred to the Surety shall be suspended during any period in which the
Surety is in default in its payment obligations under the Certificate Guaranty
Surety Bond. During any period of suspension the Surety's rights hereunder
shall vest in the Holders of the Certificates and shall be exercisable by the
Holders of at least a majority in Percentage Interest of each Class of
Certificates then Outstanding. At such time as the Certificates are no longer
Outstanding hereunder, the Surety's rights hereunder shall terminate.
Section 12.05. Recordation of Agreement; Counterparts. To the extent
permitted by applicable law, this Agreement is subject to recordation in all
appropriate public offices for real property records in all the counties or
other comparable jurisdictions in which any or all of the properties subject
to the Mortgages are situated, and in any other appropriate public recording
office or elsewhere, such recordation to be effected by the Master Servicer at
the Master Servicer's expense on direction of the Trustee accompanied by an
Opinion of Counsel (which shall not be an expense of the Trustee) to the
effect that such recordation materially and beneficially affects the interests
of the Certificateholders or is necessary for the administration or servicing
of the Mortgage Loans.
This Agreement may be executed simultaneously in any number of
counterparts, each of which counterparts shall be deemed to be an original,
and such counterparts shall constitute but one and the same instrument.
Section 12.06. Duration of Agreement. This Agreement shall continue
in existence and effect until terminated as herein provided.
Section 12.07. 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.
Section 12.08. Notices. All demands, notices and communications
hereunder shall be in writing and shall be deemed to have been duly given when
delivered to (i) in the case of the Company, MLCC Mortgage Investors, Inc.,
4802 Deer Lake Drive East, Jacksonville, Florida 32246, Attention: President,
(ii) in the case of the Master Servicer, Merrill Lynch Credit Corporation,
4802 Deer Lake Drive East, Jacksonville, Florida 32246, Attention: President,
with a copy at the same address to the General Counsel of the Master Servicer,
(iii) in the case of the Trustee, at the Corporate Trust Office, Attention:
MLCCMI Mortgage Loan Asset Backed Certificates Series 1999-A, (iv) in the case
of Moody's Investors Service, Inc., 99 Church Street, New York, New York
10007, Attention: Structured Finance Surveillance, (v) in the case of Standard
& Poor's, 26 Broadway, 15th Floor, New York, New York, Attention: Mortgage
Surveillance Group, (vi) in the case of the Certificate Insurer and the
Surety, Ambac Assurance Corporation, One State Street Plaza, New York, New
York 10004, Attention: MBS Surveillance, or (vii) in the case of any of the
foregoing persons, such other addresses as may hereafter be furnished by any
such persons to the other parties to this Agreement. Notice to a
Certificateholder shall be sent U.S. mail first class postage prepaid and
shall be deemed given when mailed addressed to the address shown in the
Certificate Register.
[End of Article XII]
<PAGE>
IN WITNESS WHEREOF, the Company, the Master Servicer and the Trustee
have caused their names to be signed hereto by their respective officers
thereunto duly authorized as of the day and year first above written.
MLCC MORTGAGE INVESTORS,
INC., as the Company
By
---------------------------------
Name: Laurel A. Davis
Title: Vice President
and Assistant Secretary
MERRILL LYNCH CREDIT CORPORATION,
as Master Servicer
By
--------------------------------
Name: Linzy S. Banks
Title: Vice President
BANKERS TRUST COMPANY OF CALIFORNIA, N.A.
as Trustee
By
-------------------------------
Name:
Title:
<PAGE>
STATE OF FLORIDA
COUNTY OF DUVAL
The foregoing instrument was acknowledged before me this ___ day of
December, 1999, by Laurel A. Davis, as Vice President and Assistant Secretary
of MLCC Mortgage Investors, Inc., a Florida corporation, on behalf of the
corporation. He/She/They
( ) is/are personally known to me; or
( ) produced a Florida driver's license as identification; or
( ) produced _________________ as identification.
-----------------------------
_____________________, Notary
Public, State of Florida
My commission expires: _______
Serial No.__________
(Notarial Seal)
<PAGE>
STATE OF FLORIDA
COUNTY OF DUVAL
The foregoing instrument was acknowledged before me this ___ day of
December, 1999, by Linzy S. Banks, as Vice President of Merrill Lynch Credit
Corporation, a Florida corporation, on behalf of the corporation. He/She/They
( ) is/are personally known to me; or
( ) produced a Florida driver's license as identification; or
( ) produced _________________ as identification.
-----------------------------
_____________________, Notary
Public, State of Florida
My commission expires: _______
Serial No.__________
(Notarial Seal)
<PAGE>
STATE OF CALIFORNIA )
) ss.:
COUNTY OF ORANGE )
On the ____ day of December 1999, before me, a notary public in and
for said State, personally appeared _____________, known to me to be an
______________ of Bankers Trust Company of California, N.A., that executed the
within instrument, and also known to me to be the person who executed it on
behalf of said banking association, and acknowledged to me that such banking
association 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 written.
-----------------------------
Notary Public
[Notarial Seal]
My Commission expires:
<PAGE>
EXHIBIT A
MORTGAGE LOAN SCHEDULE
<PAGE>
EXHIBIT B
CONTENTS OF MORTGAGE FILE
With respect to each Mortgage Loan, the Mortgage File shall include
each of the following items:
1. Original Mortgage Note endorsed (by facsimile signature if
so authorized by the Mortgage Loan Seller), "Pay to the
order of Bankers Trust Company of California, N.A., as
trustee, under that certain Pooling and Servicing Agreement
dated as of December 1, 1999, for Mortgage Loan Asset Backed
Pass-Through Certificates, Series 1999-A (MLCC Mortgage
Investors, Inc., Seller) without recourse" and signed in the
name of the Mortgage Loan Seller by an authorized officer.
2. Original recorded Mortgage, or if such original has been
delivered to the appropriate recorder's office for
recording, a certified copy thereof certified true and
complete by the Mortgage Loan Seller or the escrow agent
acting in connection with the origination of the Mortgage
Loan, with the original to be delivered within 180 days of
the Closing Date (or the related Subsequent Transfer Date in
the case of a Subsequent Mortgage Loan).
3. Original Assignment of Mortgage in recordable form to
"Bankers Trust Company of California, N.A., as trustee,
under that certain Pooling and Servicing Agreement dated as
of December 1, 1999, for Mortgage Loan Asset Backed
Pass-Through Certificates, Series 1999-A", executed by an
authorized signatory of the Mortgage Loan Seller. Subject to
the foregoing, such assignments may, if permitted by law, be
in the form of blanket assignments for Mortgage Loans
covering Mortgaged Properties situated within the same
county. If the Assignment of Mortgage is in blanket form, a
copy of the Assignment of Mortgage shall be included in the
individual Mortgage File.
4. Originals of all assumption and modification agreements, if
any.
5. Original policies of title insurance, or if the original
policy of title insurance is unavailable, a copy of the
preliminary title report, with the original title policy to
be delivered within 150 days of the Closing Date (or the
related Subsequent Transfer Date in the case of a Subsequent
Mortgage Loan). The policy must affirmatively insure ingress
and egress and insure against encroachments by or upon the
Mortgaged Property or any interest therein. If the original
title policy has been lost, stolen or misplaced, a certified
copy thereof certified true and complete by the Mortgage
Loan Seller shall be included in the individual Mortgage
File no later than 180 days after the Closing Date (or the
Subsequent Transfer Date in the case of Subsequent Mortgage
Loans).
6. With respect to those Mortgage Loans which are cooperative
loans, the original Mortgage Note, endorsed (by facsimile
signature if so authorized by the Mortgage Loan Seller),
"Pay to the order of Bankers Trust Company of California,
N.A., as trustee, under that certain Pooling and Servicing
Agreement dated as of December 1, 1999, for Mortgage Loan
Asset Backed Pass-Through Certificates, Series 1999-A (MLCC
Mortgage Investors, Inc., Seller) without recourse" and
signed in the name of the Mortgage Loan Seller by an
authorized officer; the original stock certificate and
related stock power executed by the obligor in blank; the
original loan security agreement and the assignment of the
note and loan security agreement, if applicable, assigned to
"Bankers Trust Company of California, N.A. as trustee under
that certain Pooling and Servicing Agreement dated as of
December 1, 1999 for Mortgage Loan Asset Backed Pass-Through
Certificates, Series 1999-A"; the original proprietary lease
and the assignment of the proprietary lease, if applicable,
executed by the obligor in blank; and any financing
statements relating thereto.
<PAGE>
EXHIBIT C
FORM OF FACE OF CLASS A CERTIFICATE
SOLELY FOR U.S. FEDERAL INCOME TAX PURPOSES, THIS
CERTIFICATE IS A "REGULAR INTEREST" IN A "REAL ESTATE
MORTGAGE INVESTMENT CONDUIT" AS THOSE TERMS ARE
DEFINED, RESPECTIVELY, IN SECTIONS 860G AND 860D OF THE
INTERNAL REVENUE CODE.
UNLESS THIS CERTIFICATE IS PRESENTED BY AN AUTHORIZED
REPRESENTATIVE OF THE DEPOSITORY TRUST COMPANY, A NEW YORK
CORPORATION ("DTC"), TO THE TRUSTEE OR ITS AGENT FOR
REGISTRATION OF TRANSFER, EXCHANGE, OR PAYMENT, AND ANY
CERTIFICATE ISSUED IS REGISTERED IN THE NAME OF CEDE
& CO. OR IN SUCH OTHER NAME AS IS REQUESTED BY AN AUTHORIZED
REPRESENTATIVE OF DTC (AND ANY PAYMENT IS MADE TO CEDE & CO. OR TO
SUCH OTHER ENTITY AS IS REQUESTED BY AN AUTHORIZED REPRESENTATIVE OF
DTC), ANY TRANSFER, PLEDGE, OR OTHER USE HEREOF FOR VALUE OR
OTHERWISE BY OR TO ANY PERSON IS WRONGFUL INASMUCH AS THE REGISTERED
OWNER HEREOF, CEDE & CO., HAS AN INTEREST HEREIN.
CLASS A
MORTGAGE LOAN ASSET BACKED PASS-THROUGH CERTIFICATE
SERIES 1999-A
NUMBER: ORIGINAL DENOMINATION
-----------------------
DATE OF POOLING $_____________________
AND SERVICING AGREEMENT:
____________ 1, 199_
CUT-OFF DATE:
___________, 199_
FINAL SCHEDULED ORIGINAL CLASS A PRINCIPAL
MATURITY DATE: BALANCE:
__________ 15, 20__ $______________________
FIRST DISTRIBUTION DATE:
_______ 15, 2000 CUSIP__________________
<PAGE>
evidencing a percentage interest in any distribution allocable to the
Class A Certificates with respect to a pool of adjustable rate
conventional one- to four-family mortgage loans formed and sold by
MLCC MORTGAGE INVESTORS, INC.
THIS CERTIFICATE DOES NOT REPRESENT AN OBLIGATION OF OR INTEREST IN
MLCC MORTGAGE INVESTORS, INC., THE MASTER SERVICER OR THE TRUSTEE REFERRED TO
BELOW OR ANY OF THEIR AFFILIATES. NEITHER THIS CERTIFICATE NOR THE UNDERLYING
MORTGAGE LOANS ARE GUARANTEED OR INSURED BY MLCC MORTGAGE INVESTORS, INC. OR
BY ANY OF ITS AFFILIATES OR BY ANY GOVERNMENTAL AGENCY OR INSTRUMENTALITY.
THE PRINCIPAL BALANCES OF THE MORTGAGE LOANS EVIDENCED BY THIS
CERTIFICATE ("CERTIFICATE BALANCE") WILL BE REDUCED BY A PORTION OF THE
PAYMENTS ON SUCH MORTGAGE LOANS. ACCORDINGLY, FOLLOWING THE INITIAL ISSUANCE
OF THE CERTIFICATES, THE CERTIFICATE BALANCE OF THIS CERTIFICATE WILL BE
DIFFERENT FROM THE ORIGINAL DENOMINATION SHOWN ABOVE. ANYONE ACQUIRING THIS
CERTIFICATE MAY ASCERTAIN ITS CURRENT CERTIFICATE BALANCE BY INQUIRY OF THE
TRUSTEE. ON THE DATE OF THE INITIAL ISSUANCE OF THE CERTIFICATES, THE TRUSTEE
IS BANKERS TRUST COMPANY OF CALIFORNIA, N.A., 1761 EAST ST. ANDREW PLACE,
SANTA ANA, CA 92705.
This certifies that CEDE & CO. is the registered owner of a
beneficial interest in certain monthly distributions with respect to a pool
(the "Mortgage Pool") of conventional one- to four-family mortgage loans (the
"Mortgage Loans") formed and sold by MLCC Mortgage Investors, Inc.
(hereinafter called the "Company", which term includes any successor entity
under the Agreement referred to below) and certain other property held in
trust for the benefit of Certificateholders (collectively, the "Trust Fund").
The Mortgage Loans are serviced by Merrill Lynch Credit Corporation (the
"Master Servicer"). The Trust Fund was created pursuant to a Pooling and
Servicing Agreement dated as specified above (the "Agreement") among the
Company, the Master Servicer and Bankers Trust Company of California, N.A., as
trustee (the "Trustee"), a summary of certain of the pertinent provisions of
which is set forth hereafter. To the extent not defined herein, the
capitalized terms used herein have the meanings assigned in the Agreement.
This Certificate is one of a duly authorized issue of Certificates,
designated as Mortgage Loan Asset Backed Pass-Through Certificates, Series
1999-A, Class A (the "Class A Certificates") and 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. Also issued under the Agreement are
Certificates designated as Mortgage Loan Asset Backed Pass-Through
Certificates, Series 1999-A, Class B (the "Class B Certificates"), Mortgage
Loan Asset Backed Pass-Through Certificates, Series 1999-A, Class C (the
"Class C Certificates"), Mortgage Loan Asset Backed Pass-Through Certificates,
Series 1999-A, Class C (the "Class C Certificates"), and a residual interest
Certificate designated as Mortgage Loan Asset Backed Pass-Through
Certificates, Series 1999-A, Class R (the "Class R Certificate"). The Class B
Certificates, the Class C Certificates and the Class R Certificate are
subordinate to the Class A Certificates in right of payment to the extent
described in the Agreement. The Class A Certificates, the Class B
Certificates, the Class C Certificates and the Class R Certificate are
collectively referred to as the "Certificates". The interests of the Class A
Certificateholders in the Trust Fund will vary as described in the Agreement.
Pursuant to the terms of the Agreement, the Paying Agent will
distribute from certain funds in the Distribution Account on the 15th day of
each month or, if such 15th day is not a Business Day, the first Business Day
immediately following (the "Distribution Date"), commencing on _______ 15,
2000, to the Person in whose name this Certificate is registered on the
related Record Date, an amount equal to the product of the Percentage Interest
evidenced by this Certificate and the Class A Distribution Amount for such
Distribution Date.
Distributions on this Certificate will be made by the Paying Agent
either by check mailed to the address of the Person entitled thereto, as such
name and address shall appear on the Certificate Register, or, by wire
transfer in immediately available funds to the account of such Holder at a
bank or other financial or depository institution having appropriate
facilities therefor, if such Holder has so notified the Paying Agent in
writing at least five Business Days prior to the Record Date for such
Distribution Date and such Holder's Class A Certificates evidence an original
denomination of not less than $5,000,000. Notwithstanding the above, the final
distribution on this Certificate will be made after due notice by the Trustee
of the pendency of such distribution and only upon presentation and surrender
of this Certificate at the office or agency appointed by the Trustee for that
purpose and specified in such notice of final distribution.
Unless this Certificate is presented by an authorized representative
of The Depository Trust Company to the Trustee or its agent for registration
of transfer, exchange or payment, and any certificate issued is registered in
the name of Cede & Co. or in such other name as is requested by an authorized
representative of The Depository Trust Company and any payment is made to Cede
& Co. or to such other entity as is requested by an authorized representative
of DTC, any transfer, pledge or other use hereof for value or otherwise by or
to any person is wrongful inasmuch as the registered owner hereof, Cede & Co.,
has an interest herein.
Reference is hereby made to the further provisions of this
Certificate set forth hereafter, which further provisions shall for all
purposes have the same effect as if set forth at this place.
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>
IN WITNESS WHEREOF, the Trustee has caused this Certificate to be
duly executed.
Dated: December 21, 1999
BANKERS TRUST COMPANY OF
CALIFORNIA, N.A.,
as Trustee
By:
----------------------------
Authorized Signatory
FORM OF CERTIFICATE OF
AUTHENTICATION
THIS IS ONE OF THE CLASS A CERTIFICATES
REFERRED TO IN THE WITHIN-MENTIONED AGREEMENT
BANKERS TRUST COMPANY OF CALIFORNIA, N.A.,
as Trustee
By:_______________________
Authorized Signatory
<PAGE>
FORM OF REVERSE OF CLASS A CERTIFICATE
This Class A Certificate is one of a duly authorized issue of
Certificates, designated as Mortgage Loan Asset Backed Pass-Through
Certificates, Series 1999-A, issued in one Class of Class A Certificates, one
Class of Class B Certificates, one Class of Class C Certificates and one Class
of Class R Certificates, each evidencing an interest in certain distributions,
as specified in the Agreement, with respect to a pool of adjustable rate
conventional one- to four-family mortgage loans formed and sold by the Company
and certain other property conveyed by the Company to the Trustee. The Class
B, Class C and Class R Certificates represent subordinate interests in the
Trust Fund (to the extent provided in the Agreement) to those of the Class A
Certificates. The Class R Certificate represents the residual interest in the
Trust Fund.
The Trustee will cause to be kept at its Corporate Trust Office in
Santa Ana, California, or at the office of its designated agent, a Certificate
Register in which, subject to such reasonable regulations as it may prescribe,
the Trustee will provide for the registration of Certificates and of transfers
and exchanges of Certificates. Upon surrender for registration of transfer of
any Certificate at any office or agency of the Trustee maintained for such
purpose, the Trustee will, subject to the limitations set forth in the
Agreement, authenticate and deliver, in the name of the designated transferee
or transferees, a Certificate of a like Class and aggregate Percentage
Interest and dated the date of authentication by the Trustee.
No service charge will be made for any transfer or exchange of the
Certificate, 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 the Certificate. Prior to due presentation of a
Certificate for registration of transfer, the Company, the Master Servicer,
the Certificate Insurer, the Surety and the Trustee may treat the person in
whose name any Certificate is registered as the owner of such Certificate and
the Percentage Interest in the Trust Fund evidenced thereby for the purpose of
receiving distributions pursuant to the Agreement and for all other purposes
whatsoever, and neither the Company, the Master Servicer, the Certificate
Insurer, the Surety nor the Trustee will be affected by notice to the
contrary.
The Agreement may be amended from time to time by the Company, the
Master Servicer and the Trustee, with the consent of the Certificate Insurer
and the Surety and without the consent of any of the Certificateholders, (i)
to cure or correct any ambiguity, mistake or error, (ii) to correct or
supplement any provisions therein which may be inconsistent with any other
provisions therein or with the Prospectus Supplement or Prospectus pursuant to
which the Class A Certificates were offered, (iii) to ensure continuing
treatment of the Trust Fund (exclusive of the Mortgage 100(sm) Pledge
Agreements, the Parent Power(R) Agreements, the Pre-Funding Account (including
the funds therein and Pre-Funding Earnings) and the Carryover Reserve Fund
(including the funds therein)) as two REMICs or to avoid the imposition of
certain tax liabilities, (iv) to obtain a rating by a nationally recognized
rating agency or to maintain or improve the ratings of the Class A
Certificates then given by a rating agency (it being understood that, after
obtaining the ratings of the Class A Certificates at the Closing Date, none of
the Trustee, the Company or the Master Servicer is obligated to obtain,
maintain or improve any rating of any Class of Certificates), and (v) to make
any other provisions with respect to matters or questions arising under the
Agreement which are not materially inconsistent with the provisions of the
Agreement, including without limitation provisions relating to the issuance of
Definitive Certificates to Certificate Owners if book-entry registration of
the Class A Certificates is no longer permitted; provided that, in the case of
clause (v), such action does not, as evidenced by an Opinion of Counsel,
adversely affect in any material respect the interest of any
Certificateholder.
The Agreement may also be amended from time to time by the Company,
the Master Servicer and the Trustee, with the consent of the Holders of
Certificates of each Class affected thereby evidencing, as to each such Class,
Percentage Interests aggregating not less than 66 2/3% and the consent of
the Certificate Insurer and the Surety, for the purpose of adding any
provisions to or changing in any manner or eliminating any of the provisions
of the Agreement or of modifying in any manner the rights of the Holders of
Certificates of such Class; provided, however, that no such amendment may (i)
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 (ii) reduce the
aforesaid percentage of Certificates of any Class the Holders of which are
required to consent to any such amendment, without the consent of the Holders
of all Certificates of such Class then outstanding.
The Company intends to cause an election to be made to treat the
Trust Fund (exclusive of the Mortgage 100(sm) Pledge Agreements, the Parent
Power(R) Agreements, the Pre-Funding Account (including the funds therein and
Pre-Funding Earnings) and the Carryover Reserve Fund (including the funds
therein)) as two real estate mortgage investment conduits (the "Lower-Tier
REMIC" and the "Upper-Tier REMIC"). The Class A Certificates, the Class B
Certificates and the Class C Certificates will constitute "regular interests"
in the Upper-Tier REMIC. The Class R Certificate will constitute the "residual
interest" in the Upper-Tier REMIC.
The respective obligations and responsibilities of the Company, the
Master Servicer and the Trustee under the Agreement will terminate upon: (i)
the later of the final payment or other liquidation (or any advance with
respect thereto) of the last Mortgage Loan or the disposition of all property
acquired upon foreclosure or deed in lieu of foreclosure of any Mortgage Loan
and the remittance of all funds due thereunder; or (ii) at the option of the
Master Servicer, the Certificate Insurer or the Surety, on any Distribution
Date which occurs in the month following a Due Date on which the aggregate
unpaid Principal Balance of all outstanding Mortgage Loans is less than 10% of
the aggregate unpaid Principal Balance of the Mortgage Loans on the Cut-off
Date in accordance with the provisions set forth in the Agreement; provided,
however, that in no event shall the trust created hereby continue beyond the
expiration of 21 years from the death of the last survivor of the descendants
of Joseph P. Kennedy, the late ambassador of the United States to the Court of
St. James's, living on the date hereof.
Most of the Mortgage Loans are convertible to fixed rates or new
Indices in accordance with their terms.
<PAGE>
FORM OF ASSIGNMENT
FOR VALUE RECEIVED, the undersigned hereby sells, assigns and
transfers unto
(PLEASE INSERT SOCIAL SECURITY* OR TAXPAYER IDENTIFICATION NUMBER OF ASSIGNEE)
- --------------------
- --------------------
- -----------------------------------------------------------
(Please Print or Typewrite Name and Address of Assignee)
- -----------------------------------------------------------------------------
the within Certificate, and all rights thereunder, and hereby does irrevocably
constitute and appoint
____________________________Attorney
to transfer the within Certificate on the books kept for the registration
thereof, with full power of substitution in the premises.
Dated:
(Signature guaranty) ______________________________
NOTICE: The signature to
this assignment must
correspond with the name
as it appears upon the
face of the within
Certificate in every
particular, without
alteration or enlargement
or any change whatever.
(*This information, which is voluntary, is being requested to ensure that the
assignee will not be subject to backup withholding under Section 3406 of the
Code.)
<PAGE>
EXHIBIT D
FORM OF FACE OF CLASS B CERTIFICATE
[THE FOLLOWING INFORMATION IS PROVIDED SOLELY FOR PURPOSES OF
APPLYING UNITED STATES FEDERAL INCOME TAX ORIGINAL ISSUE DISCOUNT
("OID") RULES TO THIS CERTIFICATE. FOR PURPOSES OF SUCH RULES, THE
ISSUE DATE OF THIS CERTIFICATE IS _________________. THE INITIAL
INTEREST RATE PAYABLE ON THIS CERTIFICATE IS ____. THIS CERTIFICATE
HAS BEEN ISSUED WITH $________ OF OID PER $1000 OF PRINCIPAL AMOUNT,
AND THE YIELD TO MATURITY IS _______. THE AMOUNT OF OID ATTRIBUTABLE
TO THE INITIAL SHORT ACCRUAL PERIOD IS $_____ PER $1000 OF PRINCIPAL
AMOUNT CALCULATED UNDER THE EXACT [APPROXIMATE] METHOD.]
THIS CLASS B CERTIFICATE HAS NOT BEEN REGISTERED UNDER THE SECURITIES
EXCHANGE ACT OF 1933, AS AMENDED, OR THE SECURITIES LAWS OF ANY STATE
AND MAY NOT BE RESOLD OR TRANSFERRED UNLESS IT IS REGISTERED PURSUANT
TO SUCH ACT OR LAWS OR IS SOLD OR TRANSFERRED IN TRANSACTIONS WHICH
ARE EXEMPT FROM REGISTRATION UNDER SUCH ACT OR UNDER APPLICABLE STATE
LAW AND IS TRANSFERRED IN ACCORDANCE WITH THE PROVISIONS OF SECTION
4.02 OF THE AGREEMENT REFERRED TO HEREIN.
THIS CLASS B CERTIFICATE IS SUBORDINATE IN RIGHT OF PAYMENT TO THE
CLASS A CERTIFICATES AS DESCRIBED IN THE AGREEMENT REFERRED TO
HEREIN.
SOLELY FOR U.S. FEDERAL INCOME TAX PURPOSES, THIS CERTIFICATE IS A
"REGULAR INTEREST" IN A "REAL ESTATE MORTGAGE INVESTMENT CONDUIT" AS
THOSE TERMS ARE DEFINED, RESPECTIVELY, IN SECTIONS 860G AND 860D OF
THE INTERNAL REVENUE CODE.
CLASS B ORIGINAL DENOMINATION:
SUBORDINATE $_____________________
NUMBER:
-----------------------
ORIGINAL CLASS B
DATE OF POOLING
AND SERVICING AGREEMENT: PRINCIPAL BALANCE:
CUT-OFF DATE:
___________, 199_
FINAL SCHEDULED
MATURITY DATE:
__________ 15, 20__
FIRST DISTRIBUTION DATE:
_______ 15, 2000
<PAGE>
MORTGAGE LOAN ASSET BACKED PASS-THROUGH
CERTIFICATES, SERIES 1999-A
evidencing a percentage interest in any
distribution allocable to the Class B
Certificates with respect to a pool of
adjustable rate conventional one- to four-
family mortgage loans formed and sold by
MLCC MORTGAGE INVESTORS, INC.
THIS CERTIFICATE DOES NOT REPRESENT AN OBLIGATION OF OR INTEREST IN
MLCC MORTGAGE INVESTORS, INC., THE MASTER SERVICER OR THE TRUSTEE REFERRED TO
BELOW OR ANY OF THEIR AFFILIATES. NEITHER THIS CERTIFICATE NOR THE UNDERLYING
MORTGAGE LOANS ARE GUARANTEED OR INSURED BY MLCC MORTGAGE INVESTORS, INC. OR
BY ANY OF THEIR AFFILIATES OR BY ANY GOVERNMENTAL AGENCY OR INSTRUMENTALITY.
THE PRINCIPAL BALANCES OF THE MORTGAGE LOANS EVIDENCED BY THIS
CERTIFICATE ("CERTIFICATE BALANCE") WILL BE REDUCED BY A PORTION OF THE
PAYMENTS ON SUCH MORTGAGE LOANS. ACCORDINGLY, FOLLOWING THE INITIAL ISSUANCE
OF THE CERTIFICATES, THE CERTIFICATE BALANCE OF THIS CERTIFICATE WILL BE
DIFFERENT FROM THE ORIGINAL DENOMINATION SHOWN ABOVE. ANYONE ACQUIRING THIS
CERTIFICATE MAY ASCERTAIN ITS CURRENT CERTIFICATE BALANCE BY INQUIRY OF THE
TRUSTEE. ON THE DATE OF THE INITIAL ISSUANCE OF THE CERTIFICATES, THE TRUSTEE
IS BANKERS TRUST COMPANY OF CALIFORNIA, N.A., 1761 EAST ST. ANDREW PLACE,
SANTA ANA, CA 92705.
This certifies that ___________________ is the registered owner of a
beneficial interest in certain distributions with respect to a pool (the
"Mortgage Pool") of conventional one- to four-family mortgage loans (the
"Mortgage Loans") formed and sold by MLCC Mortgage Investors, Inc.
(hereinafter called the "Company", which term includes any successor entity
under the Agreement referred to below), and certain other property held in
trust for the benefit of Certificateholders (collectively, the "Trust Fund").
The Mortgage Loans are serviced by Merrill Lynch Credit Corporation (the
"Master Servicer"). The Trust Fund was created pursuant to a Pooling and
Servicing Agreement dated as specified above (the "Agreement"), among the
Company, the Master Servicer and Bankers Trust Company of California, N.A., as
trustee (the "Trustee"), a summary of certain of the pertinent provisions of
which is set forth hereafter. To the extent not defined herein, the
capitalized terms used herein have the meanings assigned in the Agreement.
This Certificate is one of a duly authorized issue of Certificates,
designated as Mortgage Loan Asset Backed Pass-Through Certificates, Series
1999-A, Class B (the "Class B Certificates") and 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. Also issued under the Agreement are
Certificates designated as Mortgage Loan Asset Backed Pass-Through
Certificates Series 1999-A, Class A (the "Class A Certificates"), Mortgage
Loan Asset Backed Pass-Through Certificates, Series 1999-A, Class C (the
"Class C Certificates"), and a residual interest certificate designated
Mortgage Loan Asset Backed Pass-Through Certificates, Series 1999-A, Class R
(the "Class R Certificate"). The Class A Certificates are senior to the Class
B and the Class C Certificates in right of payment to the extent described in
the Agreement. The Class A Certificates, the Class B Certificates, the Class C
Certificates and the Class R Certificate are collectively referred to as the
"Certificates".
Pursuant to the terms of the Agreement, the Paying Agent will
distribute from funds in the Distribution Account on the 15th day of each
month or, if such 15th day is not a Business Day, the first Business Day
immediately following (the "Distribution Date"), commencing on _________ 15,
2000, to the Person in whose name this Certificate is registered on the
related Record Date, an amount equal to the product of the Percentage Interest
evidenced by this Certificate and the applicable distribution amount for such
Class on such Distribution Date.
The rights of the Class B Certificateholders to receive distributions
in respect of the Class B Certificates on any Distribution Date are
subordinate to the rights of the Class A Certificateholders to receive
distributions in respect of such Class A Certificates to the extent set forth
in the Agreement. Distributions on this Certificate will be made by the Paying
Agent either by check mailed to the address of the Person entitled thereto, as
such name and address shall appear on the Certificate Register, or, by wire
transfer in immediately available funds to the account of such Holder at a
bank or other financial or depository institution having appropriate
facilities therefor, if such Holder has so notified the Paying Agent in
writing at least five Business Days prior to the Record Date for such
Distribution Date and such Holder's Class B Certificates evidence an original
denomination of not less than $5,000,000. Notwithstanding the above, the final
distribution on this Certificate will be made after due notice by the Trustee
of the pendency of such distribution and only upon presentation and surrender
of this Certificate at the office or agency appointed by the Trustee for that
purpose and specified in such notice of final distribution.
The Trustee will cause to be kept at its Corporate Trust Office in
Santa Ana, California, or at the office of its designated agent, a Certificate
Register in which, subject to such reasonable regulations as it may prescribe,
the Trustee will provide for the registration of Certificates and of transfers
and exchanges of Certificates. Upon surrender for registration of transfer of
any Certificate at any office or agency of the Trustee maintained for such
purpose, the Trustee will, subject to the limitations set forth in the
Agreement, authenticate and deliver, in the name of the designated transferee
or transferees, a Certificate of a like class and aggregate Percentage
Interest and dated the date of authentication by the Trustee.
No service charge will be made for any transfer or exchange of the
Certificate, 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 the Certificate. Prior to due presentation of a
Certificate for registration of transfer, the Company, the Master Servicer,
the Certificate Insurer, the Surety and the Trustee may treat the person in
whose name any Certificate is registered as the owner of such Certificate and
the Percentage Interest in the Trust Fund evidenced thereby for the purpose of
receiving distributions pursuant to the Agreement and for all other purposes
whatsoever, and neither the Company, the Master Servicer, the Certificate
Insurer, the Surety nor the Trustee will be affected by notice to the
contrary.
The Agreement may be amended from time to time by the Company, the
Master Servicer and the Trustee, with the consent of the Certificate Insurer
and the Surety and without the consent of any of the Certificateholders, (i)
to cure or correct any ambiguity, mistake or error, (ii) to correct or
supplement any provisions therein which may be inconsistent with any other
provisions therein or with the Prospectus Supplement or Prospectus pursuant to
which the Class A Certificates were offered, (iii) to ensure continuing
treatment of the Trust Fund (exclusive of the Mortgage 100(sm) Pledge
Agreements, the Parent Power(R) Agreements, the Pre-Funding Account (including
the funds therein and Pre-Funding Earnings) and the Carryover Reserve Fund
(including the funds therein)) as two REMICs or to avoid the imposition of
certain tax liabilities, (iv) to obtain a rating by a nationally recognized
rating agency or to maintain or improve the ratings of the Class A
Certificates then given by a rating agency (it being understood that, after
obtaining the ratings of the Class A Certificates at the Closing Date, none of
the Trustee, the Company or the Master Servicer is obligated to obtain,
maintain or improve any rating of any Class of Certificates), and (v) to make
any other provisions with respect to matters or questions arising under the
Agreement which are not materially inconsistent with the provisions of the
Agreement, including without limitation provisions relating to the issuance of
Definitive Certificates to Certificate Owners if book-entry registration of
the Class A Certificates is no longer permitted; provided that, in the case of
clause (v), such action does not, as evidenced by an Opinion of Counsel,
adversely affect in any material respect the interest of any
Certificateholder.
The Agreement may also be amended from time to time by the Company,
the Master Servicer and the Trustee, with the consent of the Holders of
Certificates of each Class affected thereby evidencing, as to each such Class,
Percentage Interests aggregating not less than 66% and the consent of the
Certificate Insurer and the Surety, for the purpose of adding any provisions
to or changing in any manner or eliminating any of the provisions of the
Agreement or of modifying in any manner the rights of the Holders of
Certificates of such Class; provided, however, that no such amendment may (i)
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 (ii) reduce the
aforesaid percentage of Certificates of any Class the Holders of which are
required to consent to any such amendment, without the consent of the Holders
of all Certificates of such Class then outstanding.
The Company intends to cause an election to be made to treat the
Trust Fund (exclusive of the Mortgage 100(sm) Pledge Agreements, the Parent
Power(R) Agreements, the Pre-Funding Account (including the funds therein and
Pre-Funding Earnings) and the Carryover Reserve Fund (including the funds
therein)) as two real estate mortgage investment conduits (the "Lower-Tier
REMIC" and the "Upper-Tier REMIC"). The Class A Certificates, the Class B
Certificates and the Class C Certificates will constitute "regular interests"
in the Upper-Tier REMIC. The Class R Certificate will constitute the "residual
interest" in the Upper-Tier REMIC.
No transfer of a Class B Certificate will be made unless such
transfer is exempt from the registration requirements of the Securities Act of
1933, as amended, and any applicable state securities laws or is made pursuant
to an effective registration statement under said Act or laws. The Trustee
shall, if not otherwise directed by the Company, require an opinion of counsel
acceptable to and in form and substance satisfactory to the Company that such
transfer is exempt (describing the applicable exemption and the basis
therefor) from the registration requirements of the Securities Act of 1933, as
amended, and from any applicable securities statute of any state, and the
transferee shall execute an investment letter in the form described by the
Agreement. Unless the Opinion of Counsel required by Section 4.02(d)(ii) has
been delivered to the Trustee in connection with this Certificate, the holder
of this Certificate represents, by virtue of its acceptance hereof, that it is
not an employee benefit plan or other retirement plan or arrangement subject
to Section 406 of ERISA or Section 4975 of the Code or a person acting on
behalf of such a plan or arrangement or using funds of such a plan or
arrangement to acquire this Certificate.
The respective obligations and responsibilities of the Company, the
Master Servicer and the Trustee under the Agreement will terminate upon: (i)
the later of the final payment or other liquidation (or any advance with
respect thereto) of the last Mortgage Loan or the disposition of all property
acquired upon foreclosure or deed in lieu of foreclosure of any Mortgage Loan
and the remittance of all funds due thereunder; or (ii) at the option of the
Master Servicer, the Certificate Insurer or the Surety, on any Distribution
Date which occurs in the month following a Due Date on which the aggregate
unpaid Principal Balance of all outstanding Mortgage Loans is less than 10% of
the aggregate unpaid Principal Balance of the Mortgage Loans on the Cut-off
Date in accordance with the provision set forth in the Agreement; provided,
however, that in no event shall the trust created hereby continue beyond the
expiration of 21 years from the death of the last survivor of the descendants
of Joseph P. Kennedy, the late ambassador of the United States to the Court of
St. James's, living on the date hereof.
Most of the Mortgage Loans are convertible to fixed rates or new
Indices in accordance with their terms.
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>
IN WITNESS WHEREOF, the Trustee has caused this Certificate to be
duly executed.
Dated: December 21, 1999
BANKERS TRUST COMPANY OF
CALIFORNIA, N.A.,
as Trustee
By:__________________________
Authorized Signatory
FORM OF CERTIFICATE OF
AUTHENTICATION
THIS IS ONE OF THE CLASS B CERTIFICATES
REFERRED TO IN THE WITHIN-MENTIONED AGREEMENT
BANKERS TRUST COMPANY OF CALIFORNIA, N.A.,
as Trustee
By:______________________
Authorized Signatory
<PAGE>
FORM OF ASSIGNMENT
FOR VALUE RECEIVED, the undersigned hereby sells, assigns and
transfers unto
(PLEASE INSERT SOCIAL SECURITY* OR TAXPAYER IDENTIFICATION NUMBER OF ASSIGNEE)
- ----------------------------------------------------------------
- ----------------------------------------------------------------
- -----------------------------------------------------------------
(Please Print or Typewrite Name and Address of Assignee)
- -----------------------------------------------------------------
the within Certificate, and all rights thereunder, and hereby does
irrevocably constitute and appoint
____________________________ Attorney
to transfer the within Certificate on the books kept for the registration
thereof, with full power of substitution in the premises.
Dated:
(Signature guaranty) _________________________________
NOTICE: The signature to this
assignment must correspond with
the name as it appears upon the
face of the within Certificate
in every particular, without
alteration or enlargement or
any change whatever.
(*This information, which is voluntary, is being requested to ensure that the
assignee will not be subject to backup withholding under Section 3406 of the
Code.)
<PAGE>
EXHIBIT E
FORM OF FACE OF CLASS C CERTIFICATE
[THE FOLLOWING INFORMATION IS PROVIDED SOLELY FOR PURPOSES OF
APPLYING UNITED STATES FEDERAL INCOME TAX ORIGINAL ISSUE DISCOUNT
("OID") RULES TO THIS CERTIFICATE. FOR PURPOSES OF SUCH RULES, THE
ISSUE DATE OF THIS CERTIFICATE IS _________________. THE INITIAL
INTEREST RATE PAYABLE ON THIS CERTIFICATE IS ____. THIS CERTIFICATE
HAS BEEN ISSUED WITH $________ OF OID PER $1000 OF PRINCIPAL AMOUNT,
AND THE YIELD TO MATURITY IS _______. THE AMOUNT OF OID ATTRIBUTABLE
TO THE INITIAL SHORT ACCRUAL PERIOD IS $_____ PER $1000 OF PRINCIPAL
AMOUNT CALCULATED UNDER THE EXACT [APPROXIMATE] METHOD.]
THIS CLASS C CERTIFICATE HAS NOT BEEN REGISTERED UNDER THE SECURITIES
EXCHANGE ACT OF 1933, AS AMENDED, OR THE SECURITIES LAWS OF ANY STATE
AND MAY NOT BE RESOLD OR TRANSFERRED UNLESS IT IS REGISTERED PURSUANT
TO SUCH ACT OR LAWS OR IS SOLD OR TRANSFERRED IN TRANSACTIONS WHICH
ARE EXEMPT FROM REGISTRATION UNDER SUCH ACT OR UNDER APPLICABLE STATE
LAW AND IS TRANSFERRED IN ACCORDANCE WITH THE PROVISIONS OF SECTION
4.02 OF THE AGREEMENT REFERRED TO HEREIN.
THIS CLASS C CERTIFICATE IS SUBORDINATE IN RIGHT OF PAYMENT TO THE
CLASS A AND CLASS B CERTIFICATES AS DESCRIBED IN THE AGREEMENT
REFERRED TO HEREIN.
SOLELY FOR U.S. FEDERAL INCOME TAX PURPOSES, THIS CERTIFICATE IS A
"REGULAR INTEREST" IN A "REAL ESTATE MORTGAGE INVESTMENT CONDUIT" AS
THOSE TERMS ARE DEFINED, RESPECTIVELY, IN SECTIONS 860G AND 860D OF
THE INTERNAL REVENUE CODE.
CLASS C PERCENTAGE INTEREST:
SUBORDINATE __________%
NUMBER:
-----------------------
-----------------------
DATE OF POOLING
AND SERVICING AGREEMENT:
____________ 1, 199_
CUT-OFF DATE:
___________, 199_
FINAL SCHEDULED
MATURITY DATE:
__________ 15, 20__
FIRST DISTRIBUTION DATE:
_______ 15, 2000
<PAGE>
MORTGAGE LOAN ASSET BACKED PASS-THROUGH
CERTIFICATES, SERIES 1999-A
evidencing a percentage interest in any
distribution allocable to the Class C
Certificates with respect to a pool of
adjustable rate conventional one- to four-
family mortgage loans formed and sold by
MLCC MORTGAGE INVESTORS, INC.
THIS CERTIFICATE DOES NOT REPRESENT AN OBLIGATION OF OR INTEREST IN
MLCC MORTGAGE INVESTORS, INC., THE MASTER SERVICER OR THE TRUSTEE REFERRED TO
BELOW OR ANY OF THEIR AFFILIATES. NEITHER THIS CERTIFICATE NOR THE UNDERLYING
MORTGAGE LOANS ARE GUARANTEED OR INSURED BY MLCC MORTGAGE INVESTORS, INC. OR
BY ANY OF THEIR AFFILIATES OR BY ANY GOVERNMENTAL AGENCY OR INSTRUMENTALITY.
THE PRINCIPAL BALANCES OF THE MORTGAGE LOANS EVIDENCED BY THIS
CERTIFICATE ("CERTIFICATE BALANCE") WILL BE REDUCED BY A PORTION OF THE
PAYMENTS ON SUCH MORTGAGE LOANS. ACCORDINGLY, FOLLOWING THE INITIAL ISSUANCE
OF THE CERTIFICATES, THE CERTIFICATE BALANCE OF THIS CERTIFICATE WILL BE
DIFFERENT FROM THE ORIGINAL DENOMINATION SHOWN ABOVE. ANYONE ACQUIRING THIS
CERTIFICATE MAY ASCERTAIN ITS CURRENT CERTIFICATE BALANCE BY INQUIRY OF THE
TRUSTEE. ON THE DATE OF THE INITIAL ISSUANCE OF THE CERTIFICATES, THE TRUSTEE
IS BANKERS TRUST COMPANY OF CALIFORNIA, N.A., 1761 EAST ST. ANDREW PLACE,
SANTA ANA, CA 92705.
This certifies that ___________________ is the registered owner of a
beneficial interest in certain distributions with respect to a pool (the
"Mortgage Pool") of conventional one- to four-family mortgage loans (the
"Mortgage Loans") formed and sold by MLCC Mortgage Investors, Inc.
(hereinafter called the "Company", which term includes any successor entity
under the Agreement referred to below), and certain other property held in
trust for the benefit of Certificateholders (collectively, the "Trust Fund").
The Mortgage Loans are serviced by Merrill Lynch Credit Corporation (the
"Master Servicer"). The Trust Fund was created pursuant to a Pooling and
Servicing Agreement dated as specified above (the "Agreement"), among the
Company, the Master Servicer and Bankers Trust Company of California, N.A., as
trustee (the "Trustee"), a summary of certain of the pertinent provisions of
which is set forth hereafter. To the extent not defined herein, the
capitalized terms used herein have the meanings assigned in the Agreement.
This Certificate is one of a duly authorized issue of Certificates,
designated as Mortgage Loan Asset Backed Pass-Through Certificates, Series
1999-A, Class C (the "Class C Certificates") and 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. Also issued under the Agreement are
Certificates designated as Mortgage Loan Asset Backed Pass-Through
Certificates Series 1999-A, Class A (the "Class A Certificates"), Mortgage
Loan Asset Backed Pass-Through Certificates, Series 1999-A, Class B (the
"Class B Certificates"), and a residual interest certificate designated
Mortgage Loan Asset Backed Pass-Through Certificates, Series 1999-A, Class R
(the "Class R Certificate"). The Class A Certificates are senior to the Class
B and the Class C Certificates in right of payment to the extent described in
the Agreement. The Class A Certificates, the Class B Certificates, the Class C
Certificates and the Class R Certificate are collectively referred to as the
"Certificates".
Pursuant to the terms of the Agreement, the Paying Agent will
distribute from funds in the Distribution Account on the 15th day of each
month or, if such 15th day is not a Business Day, the first Business Day
immediately following (the "Distribution Date"), commencing on _________ 15,
2000, to the Person in whose name this Certificate is registered on the
related Record Date, an amount equal to the product of the Percentage Interest
evidenced by this Certificate and the applicable distribution amount for such
Class on such Distribution Date.
The rights of the Class C Certificateholders to receive distributions
in respect of the Class C Certificates on any Distribution Date are
subordinate to the rights of the Class A and Class B Certificateholders to
receive distributions in respect of such Class A and Class B Certificates to
the extent set forth in the Agreement. All payments made under this
Certificate will be made in accordance with the terms of the Agreement.
Notwithstanding the above, the final distribution on this Certificate will be
made after due notice by the Trustee of the pendency of such distribution and
only upon presentation and surrender of this Certificate at the office or
agency appointed by the Trustee for that purpose and specified in such notice
of final distribution.
The Trustee will cause to be kept at its Corporate Trust Office in
Santa Ana, California, or at the office of its designated agent, a Certificate
Register in which, subject to such reasonable regulations as it may prescribe,
the Trustee will provide for the registration of Certificates and of transfers
and exchanges of Certificates. Upon surrender for registration of transfer of
any Certificate at any office or agency of the Trustee maintained for such
purpose, the Trustee will, subject to the limitations set forth in the
Agreement, authenticate and deliver, in the name of the designated transferee
or transferees, a Certificate of a like class and aggregate Percentage
Interest and dated the date of authentication by the Trustee.
No service charge will be made for any transfer or exchange of the
Certificate, 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 the Certificate. Prior to due presentation of a
Certificate for registration of transfer, the Company, the Master Servicer,
the Certificate Insurer, the Surety and the Trustee may treat the person in
whose name any Certificate is registered as the owner of such Certificate and
the Percentage Interest in the Trust Fund evidenced thereby for the purpose of
receiving distributions pursuant to the Agreement and for all other purposes
whatsoever, and neither the Company, the Master Servicer, the Certificate
Insurer, the Surety nor the Trustee will be affected by notice to the
contrary.
The Agreement may be amended from time to time by the Company, the
Master Servicer and the Trustee, with the consent of the Certificate Insurer
and the Surety and without the consent of any of the Certificateholders, (i)
to cure or correct any ambiguity, mistake or error, (ii) to correct or
supplement any provisions therein which may be inconsistent with any other
provisions therein or with the Prospectus Supplement or Prospectus pursuant to
which the Class A Certificates were offered, (iii) to ensure continuing
treatment of the Trust Fund (exclusive of the Mortgage 100(sm) Pledge
Agreements, the Parent Power(R) Agreements, the Pre-Funding Account (including
the funds therein and Pre-Funding Earnings) and the Carryover Reserve Fund
(including the funds therein)) as two REMICs or to avoid the imposition of
certain tax liabilities, (iv) to obtain a rating by a nationally recognized
rating agency or to maintain or improve the ratings of the Class A
Certificates then given by a rating agency (it being understood that, after
obtaining the ratings of the Class A Certificates at the Closing Date, none of
the Trustee, the Company or the Master Servicer is obligated to obtain,
maintain or improve any rating of any Class of Certificates), and (v) to make
any other provisions with respect to matters or questions arising under the
Agreement which are not materially inconsistent with the provisions of the
Agreement, including without limitation provisions relating to the issuance of
Definitive Certificates to Certificate Owners if book-entry registration of
the Class A Certificates is no longer permitted; provided that, in the case of
clause (v), such action does not, as evidenced by an Opinion of Counsel,
adversely affect in any material respect the interest of any
Certificateholder.
The Agreement may also be amended from time to time by the Company,
the Master Servicer and the Trustee, with the consent of the Holders of
Certificates of each Class affected thereby evidencing, as to each such Class,
Percentage Interests aggregating not less than 66% and the consent of the
Certificate Insurer and the Surety, for the purpose of adding any provisions
to or changing in any manner or eliminating any of the provisions of the
Agreement or of modifying in any manner the rights of the Holders of
Certificates of such Class; provided, however, that no such amendment may (i)
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 (ii) reduce the
aforesaid percentage of Certificates of any Class the Holders of which are
required to consent to any such amendment, without the consent of the Holders
of all Certificates of such Class then outstanding.
The Company intends to cause an election to be made to treat the
Trust Fund (exclusive of the Mortgage 100(sm) Pledge Agreements, the Parent
Power(R) Agreements, the Pre-Funding Account (including the funds therein and
Pre-Funding Earnings) and the Carryover Reserve Fund (including the funds
therein)) as two real estate mortgage investment conduits (the "Lower-Tier
REMIC" and the "Upper-Tier REMIC"). The Class A Certificates, the Class B
Certificates and the Class C Certificates will constitute "regular interests"
in the Upper-Tier REMIC. The Class R Certificate will constitute the "residual
interest" in the Upper-Tier REMIC.
No transfer of a Class C Certificate will be made unless such
transfer is exempt from the registration requirements of the Securities Act of
1933, as amended, and any applicable state securities laws or is made pursuant
to an effective registration statement under said Act or laws. The Trustee
shall, if not otherwise directed by the Company, require an opinion of counsel
acceptable to and in form and substance satisfactory to the Company that such
transfer is exempt (describing the applicable exemption and the basis
therefor) from the registration requirements of the Securities Act of 1933, as
amended, and from any applicable securities statute of any state, and the
transferee shall execute an investment letter in the form described by the
Agreement. Unless the Opinion of Counsel required by Section 4.02(d)(ii) has
been delivered to the Trustee in connection with this Certificate, the holder
of this Certificate represents, by virtue of its acceptance hereof, that it is
not an employee benefit plan or other retirement plan or arrangement subject
to Section 406 of ERISA or Section 4975 of the Code or a person acting on
behalf of such a plan or arrangement or using funds of such a plan or
arrangement to acquire this Certificate.
The respective obligations and responsibilities of the Company, the
Master Servicer and the Trustee under the Agreement will terminate upon: (i)
the later of the final payment or other liquidation (or any advance with
respect thereto) of the last Mortgage Loan or the disposition of all property
acquired upon foreclosure or deed in lieu of foreclosure of any Mortgage Loan
and the remittance of all funds due thereunder; or (ii) at the option of the
Master Servicer, the Certificate Insurer or the Surety, on any Distribution
Date which occurs in the month following a Due Date on which the aggregate
unpaid Principal Balance of all outstanding Mortgage Loans is less than 10% of
the aggregate unpaid Principal Balance of the Mortgage Loans on the Cut-off
Date in accordance with the provision set forth in the Agreement; provided,
however, that in no event shall the trust created hereby continue beyond the
expiration of 21 years from the death of the last survivor of the descendants
of Joseph P. Kennedy, the late ambassador of the United States to the Court of
St. James's, living on the date hereof.
Most of the Mortgage Loans are convertible to fixed rates or new
Indices in accordance with their terms.
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>
IN WITNESS WHEREOF, the Trustee has caused this Certificate to be
duly executed.
Dated: December 21, 1999
BANKERS TRUST COMPANY OF
CALIFORNIA, N.A.,
as Trustee
By:_____________________
Authorized Signatory
FORM OF CERTIFICATE OF
AUTHENTICATION
THIS IS ONE OF THE CLASS C CERTIFICATES
REFERRED TO IN THE WITHIN-MENTIONED AGREEMENT
BANKERS TRUST COMPANY OF CALIFORNIA, N.A.,
as Trustee
By:___________________________
Authorized Signatory
<PAGE>
FORM OF ASSIGNMENT
FOR VALUE RECEIVED, the undersigned hereby sells, assigns and
transfers unto
(PLEASE INSERT SOCIAL SECURITY* OR TAXPAYER IDENTIFICATION NUMBER OF ASSIGNEE)
- ----------------------------------------------------------------
- ----------------------------------------------------------------
- -----------------------------------------------------------------
(Please Print or Typewrite Name and Address of Assignee)
- -----------------------------------------------------------------
the within Certificate, and all rights thereunder, and hereby does
irrevocably constitute and appoint
___________________________Attorney
to transfer the within Certificate on the books kept for the registration
thereof, with full power of substitution in the premises.
Dated:
(Signature guaranty) _________________________________
NOTICE: The signature to this
assignment must correspond with
the name as it appears upon the
face of the within Certificate
in every particular, without
alteration or enlargement or
any change whatever.
(*This information, which is voluntary, is being requested to ensure that the
assignee will not be subject to backup withholding under Section 3406 of the
Code.)
<PAGE>
EXHIBIT F
FORM OF CLASS R CERTIFICATE
THIS CLASS R CERTIFICATE HAS NOT BEEN REGISTERED UNDER THE SECURITIES
ACT OF 1933, AS AMENDED, OR THE SECURITIES LAWS OF ANY STATE AND MAY
NOT BE RESOLD OR TRANSFERRED UNLESS IT IS REGISTERED PURSUANT TO SUCH
ACT OR LAWS OR IS SOLD OR TRANSFERRED IN TRANSACTIONS WHICH ARE
EXEMPT FROM REGISTRATION UNDER SUCH ACT OR UNDER APPLICABLE STATE LAW
AND IS TRANSFERRED IN ACCORDANCE WITH THE PROVISIONS OF SECTION 4.02
OF THE AGREEMENT REFERRED TO HEREIN.
THIS CLASS R CERTIFICATE IS SUBORDINATE IN RIGHT OF PAYMENT TO THE
CLASS A, CLASS B AND CLASS C CERTIFICATES AS DESCRIBED IN THE POOLING
AND SERVICING AGREEMENT REFERRED TO HEREIN.
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.
NEITHER THIS CERTIFICATE NOR ANY BENEFICIAL INTEREST HEREIN MAY BE,
DIRECTLY OR INDIRECTLY, TRANSFERRED, SOLD, PLEDGED, HYPOTHECATED OR
OTHERWISE ASSIGNED WITHOUT THE EXPRESS WRITTEN CONSENT OF THE MASTER
SERVICER, ACTING ON BEHALF OF THE TRUST FUND, AND ANY TRANSFER IN
VIOLATION OF THIS RESTRICTION SHALL BE ABSOLUTELY NULL AND VOID AND
SHALL VEST NO RIGHTS IN ANY PURPORTED TRANSFEREE, AND SHALL SUBJECT
THE HOLDER HEREOF TO LIABILITY FOR ANY TAX IMPOSED (AND RELATED
EXPENSES, IF ANY) WITH RESPECT TO SUCH ATTEMPTED TRANSFER.
CLASS R PERCENTAGE
RESIDUAL INTEREST INTEREST: 100%
NUMBER:
-----------------------
DATE OF POOLING
AND SERVICING AGREEMENT:
____________ 1, 199_
CUT-OFF DATE:
___________, 199_
FIRST DISTRIBUTION DATE:
_______ 15, 2000
MORTGAGE LOAN ASSET BACKED PASS-THROUGH CERTIFICATE
Series 1999-A
evidencing a percentage interest in any distribution allocable to the
Class R Certificates with respect to a pool of adjustable rate
conventional one- to four-family mortgage loans formed and sold by
MLCC MORTGAGE INVESTORS, INC.
THIS CERTIFICATE DOES NOT REPRESENT AN OBLIGATION OF OR INTEREST IN
MLCC MORTGAGE INVESTORS, INC., THE MASTER SERVICER OR THE TRUSTEE REFERRED TO
BELOW OR ANY OF THEIR AFFILIATES. NEITHER THIS CERTIFICATE NOR THE UNDERLYING
MORTGAGE LOANS ARE GUARANTEED OR INSURED BY MLCC MORTGAGE INVESTORS, INC. OR
BY ANY OF THEIR AFFILIATES OR BY ANY GOVERNMENTAL AGENCY OR INSTRUMENTALITY.
This certifies that ___________________ is the registered owner of a
beneficial interest in certain distributions with respect to a pool (the
"Mortgage Pool") conventional one- to four-family mortgage loans (the
"Mortgage Pool") formed and sold by MLCC Mortgage Investors, Inc. (hereinafter
called the "Company", which term includes any successor entity under the
Agreement referred to below), and certain other property held in trust for the
benefit of Certificateholders (collectively, the "Trust Fund"). The Mortgage
Loans are serviced by Merrill Lynch Credit Corporation (the "Master
Servicer"). The Trust Fund was created pursuant to a Pooling and Servicing
Agreement dated as specified above the "Agreement"), among the Company, the
Master Servicer and Bankers Trust Company of California, N.A., as trustee (the
"Trustee"), a summary of certain of the pertinent provisions of which is set
forth hereafter. To the extent not defined herein, the capitalized terms used
herein have the meanings signed in the Agreement.
This Certificate is one of a duly authorized issue of Certificates,
designated as Mortgage Loan Asset Backed Pass-Through Certificates, Series
1999-A, Class R (the "Class R Certificate") and 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. Also issued under the Agreement are
Certificates designated as Class A Certificates, Class B Certificates and
Class C Certificates. The Class A Certificates, Class B Certificates, Class C
Certificates and Class R Certificate are collectively referred to as the
"Certificates". All payments made under this Certificate will be made in
accordance with the terms of the Agreement.
The Agreement may be amended from time to time by the Company, the
Master Servicer and the Trustee, with the consent of the Certificate Insurer
and the Surety and without the consent of any of the Certificateholders, (i)
to cure or correct any ambiguity, mistake or error, (ii) to correct or
supplement any provisions therein which may be inconsistent with any other
provisions therein or with the Prospectus Supplement or Prospectus pursuant to
which the Class A Certificates were offered, (iii) to ensure continuing
treatment of the Trust Fund (exclusive of the Mortgage 100(sm) Pledge
Agreements, the Parent Power(R) Agreements, the Pre-Funding Account (including
the funds therein and Pre-Funding Earnings) and the Carryover Reserve Fund
(including the funds therein)) as two REMICs or to avoid the imposition of
certain tax liabilities, (iv) to obtain a rating by a nationally recognized
rating agency or to maintain or improve the ratings of the Class A
Certificates then given by a rating agency (it being understood that, after
obtaining the ratings of the Class A Certificates at the Closing Date, none of
the Trustee, the Company or the Master Servicer is obligated to obtain,
maintain or improve any rating of any Class of Certificates), and (v) to make
any other provisions with respect to matters or questions arising under the
Agreement which are not materially inconsistent with the provisions of the
Agreement, including without limitation provisions relating to the issuance of
Definitive Certificates to Certificate Owners if book-entry registration of
the Class A Certificates is no longer permitted; provided that, in the case of
clause (v), such action does not, as evidenced by an Opinion of Counsel,
adversely affect in any material respect the interest of any
Certificateholder.
The Agreement may also be amended from time to time by the Company,
the Master Servicer and the Trustee, with the consent of the Holders of
Certificates of each Class affected thereby evidencing, as to each such Class,
Percentage Interests aggregating not less than 66% and the consent of the
Certificate Insurer and the Surety, for the purpose of adding any provisions
to or changing in any manner or eliminating any of the provisions of the
Agreement or of modifying in any manner the rights of the Holders of
Certificates of such Class; provided, however, that no such amendment may (i)
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 (ii) reduce the
aforesaid percentage of Certificates of any Class the Holders of which are
required to consent to any such amendment, without the consent of the Holders
of all Certificates of such Class then outstanding.
The Company intends to cause an election to be made to treat the
Trust Fund (exclusive of the Mortgage 100(sm) Pledge Agreements, the Parent
Power(R) Agreements, the Pre-Funding Account (including the funds therein and
Pre-Funding Earnings) and the Carryover Reserve Fund (including the funds
therein)) as two real estate mortgage investment conduits (the "Lower-Tier
REMIC" and the "Upper-Tier REMIC"). The Class A Certificates, the Class B
Certificates and the Class C Certificates will constitute "regular interests"
in the Upper-Tier REMIC. The Class R Certificate will constitute the "residual
interest" in the Upper-Tier REMIC.
No transfer of a Class R Certificate will be made unless such
transfer is exempt from the registration requirements of the Securities Act of
1933, as amended, and any applicable state securities laws or is made pursuant
to an effective registration statement under said Act or laws. The Company may
direct the Trustee to require an opinion of counsel acceptable to and in form
and substance satisfactory to the Company that such transfer is exempt
(describing the applicable exemption and the basis therefor) from the
registration requirements of the Securities Act of 1933, as amended, and from
any applicable securities statute of any state, and the transferee shall
execute an investment letter in the form described by the Agreement. Unless
the Opinion of Counsel required by Section 4.02(d)(ii) has been delivered to
the Trustee in connection with this Certificate, the holder of this
Certificate represents, by virtue of its acceptance hereof, that it is not an
employee benefit plan or other retirement plan or arrangement subject to
Section 406 of ERISA or Section 4975 of the Code or a person acting on behalf
of such a plan or arrangement or using the funds of such a plan or arrangement
to acquire this Certificate.
The respective obligations and responsibilities of the Company, the
Master Servicer and the Trustee under the Agreement will terminate upon: (i)
the later of the final payment or other liquidation (or any advance with
respect thereto) of the last Mortgage Loan or the disposition of all property
acquired upon foreclosure or deed in lieu of foreclosure of any Mortgage Loan
and the remittance of all funds due thereunder; or (ii) at the option of the
Master Servicer, the Certificate Insurer or the Surety, on any Distribution
Date which occurs in the month following a Due Date on which the aggregate
unpaid Principal Balance of all outstanding Mortgage Loans is less than 10% of
the aggregate unpaid Principal Balance of the Mortgage Loans on the Cut-off
Date in accordance with the provisions set forth in the Agreement; provided,
however, that in no event shall the trust created hereby continue beyond the
expiration of 21 years from the death of the last survivor of the descendants
of Joseph P. Kennedy, the late ambassador of the United States to the Court of
St. James's, living on the date hereof.
Most of the Mortgage Loans are convertible to fixed rates or new
Indices in accordance with their terms.
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>
IN WITNESS WHEREOF, the Trustee has caused this Certificate to be
duly executed.
Dated: December 21, 1999
BANKERS TRUST COMPANY OF
CALIFORNIA, N.A.,
as Trustee
By: ___________________________
Authorized Signatory
FORM OF CERTIFICATE OF AUTHENTICATION
THIS IS THE CLASS R
CERTIFICATE REFERRED TO
IN THE WITHIN-MENTIONED AGREEMENT
BANKERS TRUST COMPANY OF CALIFORNIA, N.A.,
as Trustee
By:_____________________________
Authorized Signatory
<PAGE>
FORM OF ASSIGNMENT
FOR VALUE RECEIVED, the undersigned hereby sells, assigns
and transfers unto
(PLEASE INSERT SOCIAL SECURITY* OR TAXPAYER IDENTIFICATION NUMBER OF ASSIGNEE)
- -----------------------
- -----------------------
- ---------------------------------------------------------
(Please Print or Typewrite Name and Address of Assignee)
- ------------------------------------------
the within Certificate, and all rights thereunder, and hereby does
irrevocably constitute and appoint
____________________________ Attorney to transfer the within Certificate on
the books kept for the registration thereof, with full power of substitution
in the premises.
Dated:
(Signature guaranty) _____________________
NOTICE: The signature to this
assignment must correspond with
the name as it appears upon the
face of the within Certificate
in every particular, without
alteration or enlargement or
any change whatever.
(*This information, which is voluntary, is being requested to ensure that the
assignee will not be subject to backup withholding under Section 3406 of the
Code.)
<PAGE>
EXHIBIT G
[RESERVED]
<PAGE>
EXHIBIT H
CERTIFICATE ACCOUNT CERTIFICATION
_________, 199_
Merrill Lynch Credit Corporation hereby certifies that it has
established the account described below as a Certificate Account pursuant to
Section 5.08 of the Pooling and Servicing Agreement, dated as of _________ 1,
199_.
Title of Account:
"Merrill Lynch Credit Corporation, as Master Servicer, in trust for Bankers
Trust Company of California, N.A., as Trustee, for the benefit of registered
holders of MLCC Mortgage Investors, Inc., Mortgage Loan Asset Backed
Pass-Through Certificates, Series 1999-A"
Account Number: ____________________________
Address of office ____________________________
or branch at which
Account is
maintained:
MERRILL LYNCH CREDIT CORPORATION
By:__________________________
Name:
Title:
<PAGE>
EXHIBIT I
[RESERVED]
<PAGE>
EXHIBIT J
DISTRIBUTION ACCOUNT CERTIFICATION
_________, 199_
Bankers Trust Company of California, N.A. (the "Paying Agent") hereby
certifies that it has established the account described below as a
Distribution Account pursuant to Section 6.01 of the Pooling and Servicing
Agreement dated as of ___________ 1, 199_ by and among MLCC Mortgage
Investors, Inc., Merrill Lynch Credit Corporation as the Master Servicer and
the undersigned as Trustee.
Title of Account: "Bankers Trust Company of California, N.A., as Trustee on
behalf of the holders of MLCC Mortgage Investors, Inc.
Mortgage Loan Asset Backed Pass-Through Certificates, Series
1999-A"
Account Number: ____________________________
Address of office
or branch of the
Trustee at
which Account is
maintained: Bankers Trust Company of California, N.A.
1761 East St. Andrew Place
Santa Ana, California 92705
BANKERS TRUST COMPANY OF CALIFORNIA, N.A.
as Trustee
By:__________________________
Name:
Title:
<PAGE>
EXHIBIT K
FORM OF SUBSEQUENT TRANSFER AGREEMENT
SUBSEQUENT TRANSFER AGREEMENT, dated _______, 199_ (the
"Subsequent Transfer Date"), between MLCC MORTGAGE INVESTORS, INC. (the
"Company") and BANKERS TRUST OF CALIFORNIA, N.A., as trustee (the "Trustee").
WITNESSETH:
WHEREAS, the Pooling and Servicing Agreement, dated _______
1, 199_ (the "Pooling Agreement"), among the Company, Merrill Lynch Credit
Corporation, as master servicer, and the Trustee contemplated the sale of
Subsequent Mortgage Loans to the Trustee for inclusion in the Trust Fund by
the Company;
WHEREAS, the Company is acquiring Subsequent Mortgage Loans
from Merrill Lynch Credit Corporation ("MLCC") pursuant to the Subsequent
Transfer Agreement, dated the date hereof (the "MLCC Transfer Agreement"),
between the Company and MLCC; and
WHEREAS, the parties desire to consummate the purchase and
sale of the Subsequent Mortgage Loans identified on the Schedule of Subsequent
Mortgage Loans attached hereto;
NOW, THEREFORE, in consideration of the premises and of
other good and valuable consideration, the receipt and sufficiency of which
are hereby acknowledged, the parties hereto agree as follows:
1. For the consideration set forth in Paragraph 2 below, the
Company does hereby sell, transfer, assign, set over and convey to the
Trustee, on behalf of the Certificateholders and the Certificate Insurer,
without recourse (but subject to the obligations set forth herein) all right,
title and interest of the Company, and the Trustee, on behalf of the
Certificateholders and the Certificate Insurer, does hereby purchase and
acquire from the Company, (x) all right, title and interest of the Company in
and to each Subsequent Mortgage Loan listed on the Schedule of Subsequent
Mortgage Loans attached hereto, including its Principal Balance as of the
Subsequent Cut-off Date and all collections of such principal and all payments
of interest in respect of such Subsequent Mortgage Loans to the extent such
collections represent interest accrued from and including the related
Subsequent Transfer Date (interest accruing prior to such Subsequent Transfer
Date being property of the Mortgage Loan Seller) due after the related
Subsequent Cut-off Date and each related Mortgage 100(sm) Pledge Agreement and
each related Parent Power(R) Agreement and (y) all of the Company's rights,
but none of its obligations, under the MLCC Transfer Agreement. The transfer
by the Company of the Subsequent Mortgage Loans set forth on the Schedule of
Subsequent Mortgage Loans to the Trustee is absolute and is intended by all
parties hereto to be treated as a sale by the Company.
2. The cash consideration for the Subsequent Mortgage Loans
sold hereby shall be $________________, representing the aggregate outstanding
principal balance of the Subsequent Mortgage Loans as of the Subsequent
Cut-off Date.
3. The Company hereby represents that (a) it is solvent,
will not be rendered insolvent as a result of the sale of the Subsequent
Mortgage Loans sold pursuant to this Subsequent Transfer Agreement and is not
aware of any pending insolvency and (b) all of the conditions precedent to the
transfer accomplished hereby set forth in Section 1.07 of the Purchase
Agreement have been satisfied.
4. The Trustee acknowledges the assignment to it of the
Subsequent Mortgage Loans and the documents relating thereto referred to in
Section 2.01 of the Pooling and Servicing Agreement and acknowledges that
pursuant to the Custodial Agreement upon the Custodian's receipt thereof the
Custodian will hold such related documents and any other documents
constituting a part of the related Mortgage Files delivered to the Custodian
in trust for the use and benefit and of all present and future
Certificateholders, the Certificate Insurer and the Surety.
5. This Subsequent Transfer 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.
6. This Subsequent Transfer Agreement may be signed in
counterparts, each of which shall be an original but all of which, taken
together, shall constitute one and the same instrument.
7. Terms capitalized herein and not defined herein shall
have their respective meanings as set forth in the Pooling and Servicing
Agreement.
<PAGE>
IN WITNESS WHEREOF, the undersigned have executed this
Agreement by their duly authorized officers as of the date first above
written.
MLCC MORTGAGE INVESTORS, INC.
By:______________________
Name:
Title:
BANKERS TRUST OF CALIFORNIA, N.A.
as Trustee
By:_______________________
Name:
Title:
<PAGE>
EXHIBIT L
FORM OF INVESTMENT LETTER FOR HOLDER OF THE
CLASS B, CLASS C AND CLASS R CERTIFICATES
1. The Purchaser is acquiring the Class B, Class C or Class R
Certificate (the "Certificate") as principal for its own account for the
purpose of investment [neither Merrill Lynch nor any of its Affiliates need
represent that it is acquiring for purposes of investment] and not with a view
to or for sale in connection with any distribution thereof, subject
nevertheless to any requirement of law that the disposition of the Purchaser's
property shall at all times be and remain within its control.
2. The Purchaser has knowledge and experience in financial and
business matters and is capable of evaluating the merits and risks of its
investment in the Residual Interest and is able to bear the economic risk of
such investment. The Purchaser is an "accredited investor" within the meaning
of Rule 501(a) under the rules and regulations of the Securities and Exchange
Commission under the Securities Act of 1933, as amended [Affiliates of Merrill
Lynch need not make this representation]. The Purchaser has been given such
information concerning the Certificate, the underlying Mortgage Loans and the
Master Servicer as it has requested.
3. The Purchaser will comply with all applicable federal and state
securities laws in connection with any subsequent resale by the Purchaser of
the Certificate.
4. The Purchaser understands that the Certificate has not been and
will not be registered under the Securities Act of 1933, as amended, or any
state securities laws and may be resold (which resale is not currently
contemplated) only if an exemption from registration is available, that
neither the Company, the Master Servicer nor the Trustee is required to
register the Certificate and that any transfer must comply with Section 4.02
of the Pooling and Servicing Agreement. In connection with any resale of the
Certificate, the Purchaser shall not make any general solicitation or
advertisement.
5. The Purchaser agrees that it will obtain from any purchaser of the
Certificate from it the same representations, warranties and agreements
contained in the foregoing paragraphs 1 through 4 and in this paragraph 5.
<PAGE>
6. The Purchaser hereby directs the Trustee to register the
Certificate acquired by the Purchaser in the name of its nominee as follows:
____________.
Very truly yours,
_____________________
NAME OF PURCHASER
By:_______________
Name:_________________
Title:_________________
<PAGE>
EXHIBIT M
FORM OF TRANSFER AFFIDAVIT FOR CLASS R CERTIFICATES
STATE OF )
: ss.:
COUNTY OF )
The undersigned, being first duly sworn, deposes and says as follows:
1. The undersigned is an officer of _____________________ (the
"Transferee"), a corporation duly organized and existing under the laws of the
State of Delaware and on behalf of which the undersigned makes this affidavit.
2. The Transferee is acquiring a beneficial ownership interest in
Mortgage Loan Asset Backed Pass-Through Certificates, Series 1999-A, Class R
(the "Class R Certificates"), issued pursuant to the Pooling and Servicing
Agreement, dated as of ____________ 1, 199_ (the "Agreement"), by and among
MLCC Mortgage Investors, Inc., as Seller (the "Seller"), Merrill Lynch Credit
Corporation, as Master Servicer, and Bankers Trust Company of California,
N.A., as Trustee. Capitalized terms used, but not defined herein, shall have
the meanings ascribed to such terms in the Agreement. The Transferee has
authorized the undersigned to make this affidavit on behalf of the Transferee.
3. The Transferee is not, as of the date hereof, and will not be, as
of the date of the Transfer, a Disqualified Organization. The Transferee is
acquiring the Class R Certificate either (i) for its own account or (ii) as
nominee, trustee or agent for another Person and has attached hereto an
affidavit from such Person in substantially the form as this affidavit
attached hereto. The Transferee has no knowledge that any such affidavit is
false.
4. The Transferee has been advised of, and understands that: (i) a
tax shall be imposed on any Transfer to Persons that are Disqualified
Organizations; (ii) such tax is imposed on the transferor, or, if such
Transfer is through an agent (which includes a broker, nominee or middleman)
for Persons that are Disqualified Organizations, on the agent; and (iii) the
Person otherwise liable for the tax shall be relieved of liability for the tax
if the subsequent transferee furnished to such Person an affidavit that such
subsequent transferee is not a Disqualified Organization and, at the time of
the Transfer, such Person does not have actual knowledge that the affidavit is
false.
5. The Transferee has been advised and understands that a tax shall
be imposed on a "pass-through entity" holding Class R Certificates if at any
time during the taxable year of the pass-through entity a Person that is a
Disqualified Organization is the record holder of an interest in such entity.
The Transferee understands that no tax will be imposed for any period for
which the record holder furnishes to the pass-through entity an affidavit
stating that the record holder is not a Disqualified Organization and the
pass-through entity does not have actual knowledge that such affidavit is
false. (For this purpose, a "pass-through entity" includes a regulated
investment company, a real estate investment trust or common trust fund, a
partnership, trust or estate, and certain cooperatives and, except as may be
provided in Treasury Regulations, persons holding interests in pass-through
entities as nominees for other Persons.)
6. The Transferee has reviewed the provisions of Section 4.02 of the
Agreement, which is incorporated herein by reference, and understands the
legal consequences of the acquisition of the Class R Certificates including,
without limitations, the restrictions on subsequent Transfers and the
provisions regarding voiding the Transfer and mandatory sales. The Transferee
expressly agrees to be bound by and to abide by the provisions of Section 4.02
of the Agreement. The Transferee understands and agrees that any breach of any
of the representations included herein shall render the Transfer to the
Transferee contemplated hereby null and void.
7. The Transferee does not have the intention to impede the
assessment or collection of any income tax legally required to be paid with
respect to the Class R Certificates and the Transferee hereby acknowledges
that the Class R Certificates may generate tax liabilities in excess of the
cash flow associated with the Class R Certificates and intends to pay such
taxes associated with the Class R Certificates when they become due.
8. The Transferee agrees to require a Transfer Affidavit from any
Person to whom the Transferee attempts to make a Transfer and in connection
with any Transfer by a Person for whom the Transferee is acting as nominee,
trustee or agent, and the Transferee will not make a Transfer or cause any
Transfer to any Person that the Transferee knows is a Disqualified
Organization.
9. That the Purchaser (i) is not a Non-U.S. Person or (ii) is a
Non-U.S. Person that holds the Class R Certificate in connection with the
conduct of a trade or business in 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 Certificates to it is in accordance with the
requirements of the Code and the regulation promulgated thereunder and that
such transfer of the Class R Certificates will not be disregarded for federal
income tax purposes.
<PAGE>
10. The following information as to the Transferee is true and
correct:
Address:
Contact for Tax Matters:
Phone Number:
Form of Organization of Transferee:
Transferee's Federal Tax Identification Number:
Percentage of Residual Interest Acquired: __%
Price Paid for Residual Interest:
Date of Acquisition:
If security is being registered in the name of a nominee, please
state such name:
<PAGE>
IN WITNESS WHEREOF, the Transferee has caused this instrument to be
executed on its behalf, pursuant to authority of its _________________, by its
duly authorized officer this _____ day of _____________.
[NAME OF TRANSFEREE]
By: ___________________________
Name:
Title:
<PAGE>
STATE OF )
) ss.:
COUNTY OF )
Personally appeared before me the above-named __________, known or
proved to me to be the same person who executed the foregoing instrument and
to be the of _______________________________, and acknowledged that he
executed the same as his free act and deed and the free act and deed of the
Transferee.
Subscribed and sworn before me this _______ of ___________.
-----------------------------
NOTARY PUBLIC
My commission expires the ___
day of ___________________, 19__.
<PAGE>
EXHIBIT N
ERISA REPRESENTATION LETTER (for
Transfers of Class B, Class C and Class R
Certificates)
The Purchaser is not an employee benefit plan or other retirement
plan or arrangement (a "Plan") subject to Section 406 of the Employee
Retirement Income Security Act of 1974, as amended ("ERISA"), or Section 4975
of the Internal Revenue Code of 1986, as amended (the "Code") or a person
acting on behalf of such a Plan or arrangement or using the assets of such a
Plan or arrangement to acquire a Class [R] [B] [C] Certificate.
<PAGE>
EXHIBIT O
[RESERVED]
<PAGE>
EXHIBIT P
Sale Agreement
See Tab 5
<PAGE>
EXHIBIT Q
Form of Notice for Certificate Insurance Policy
<PAGE>
EXHIBIT R
Form of Notice for Certificate Guaranty Surety Bond
